The government kept MPs in the dark when it presented an overly optimistic assessment of its Brexit deal, rather than a realistic prediction of the final relationship, an influential committee of MPs has found.

The Treasury select committee, chaired by the former cabinet minister Nicky Morgan, found that the UK government had also failed to give adequate information on how the backstop mechanism would affect the economy.

Quick Guide Brexit and backstops: an explainer Show A backstop is required to ensure there is no hard border in Ireland if a comprehensive free trade deal cannot be signed before the end of 2020. Theresa May has proposed to the EU that the whole of the UK would remain in the customs union after Brexit, but Brussels has said it needs more time to evaluate the proposal. As a result, the EU insists on having its own backstop - the backstop to the backstop - which would mean Northern Ireland would remain in the single market and customs union in the absence of a free trade deal, prompting fierce objections from Conservative hard Brexiters and the DUP, which props up her government. That prompted May to propose a country-wide alternative in which the whole of the UK would remain in parts of the customs union after Brexit. “The EU still requires a ‘backstop to the backstop’ – effectively an insurance policy for the insurance policy. And they want this to be the Northern Ireland-only solution that they had previously proposed,” May told MPs. Raising the stakes, the prime minister said the EU’s insistence amounted to a threat to the constitution of the UK: “We have been clear that we cannot agree to anything that threatens the integrity of our United Kingdom,” she added.

The insurance measure in the withdrawal agreement would keep the UK in the customs union and parts of the single market if no alternative solution could be reached to avoid a hard border on the island of Ireland.

Morgan said committee members had found it “difficult” to give MPs adequate advice on the Treasury’s economic analysis of the withdrawal agreement and political declaration, given what was in front of them.

The Treasury had analysed the economic implications of the white paper – the government’s plan for the UK’s future relationship with the EU – which was based on Theresa May’s proposals from her Chequers summit.

However, that was an unrealistic expectation of what could be achieved, the committee found. “The committee is disappointed that the government has modelled its white paper, which represents the most optimistic reading of the political declaration, rather than a more realistic scenario,” Morgan said.

The report itself found the Chequers plan “does not represent the central or most likely outcome” of the negotiations for the future relationship. “Therefore, it cannot be used to inform parliament’s meaningful vote on the withdrawal agreement,” it concludes.

The committee said it was disappointed the government had not provided any analysis of the short-term impact of the Brexit deal on regional or sectoral job losses or on the public finances, nor on the impact of the UK needing to remain in the backstop arrangement.

“Trade negotiations can take four years to agree, and previous EU negotiations have taken longer,” the report found. “It is feasible, therefore, that the UK could enter the backstop. Despite it being neither the UK’s nor the EU’s preferred position, the government should have modelled the backstop.”

The committee’s report was examining a Whitehall analysis, produced for MPs in the run-up to the now-delayed parliamentary vote. The study concluded that the UK would be significantly worse off under five possible Brexit scenarios in 15 years’ time, including the Norway model favoured by some soft Brexiters and the Canada free trade model favoured by hard Eurosceptics.

Quick Guide What is the common market 2.0/Norway-plus Brexit option? Show This soft Brexit compromise has been championed as a plan B for leaving the European Union. It is based on Norway’s relationship with the EU, which is outside the bloc and the customs union but inside the single market. Under the plan the UK would have to join Norway, Liechtenstein and Iceland in the European Free Trade Association (Efta), which would then allow it to participate in the European Economic Area (EEA). The ‘plus’ in this option refers to a temporary customs union with the EU, which would need to be negotiated to avoid a hard border on the island of Ireland. This arrangement would remain in place until the EU and UK agreed a specific trade deal. The option has the advantage of being as close to the EU as possible without full membership, and it would do away with the need for the problematic backstop for Northern Ireland. Like Norway, the UK would be outside the common fisheries and agriculture policies, and would not be subject to the European court of justice. But it crosses a key red line for Brexiters by continuing freedom of movement, one of the preconditions of single market membership. It would also limit the UK's ability to negotiate its own trade deals while a new customs arrangement is under discussion. And it would require continued financial contributions to the EU without an influence, as the UK would no longer have MEPs or a seat on the European Council. It also isn't entirely clear that the UK would be welcomed into Efta.

The two closest models to May’s deal suggested the economy would be somewhere between 3.9% and 2.1% smaller in 2035-36 when compared with remaining in the EU.

Under the worst-case, no-deal scenario, GDP would be 10.7% lower than if the UK had stayed in the EU in 15 years’ time.

The Labour MP Jo Stevens, who backs the anti-Brexit Best for Britain campaign, said: “The fact that the government won’t do economic forecasts on its deal shows what a mess its plans are. They clearly don’t believe it will be good for the country and want to avoid the embarrassment.



“But the scale of deceit goes further. There’s something shocking and deeply unsettling about a government who refuse to provide parliament with the facts they need before the meaningful vote finally happens. They want the meaningful vote to be meaningless.”