Former Bank of England Governor Mervyn King has said that the economic costs of Britain leaving the European Union have been “exaggerated”, as he accused those on both sides of the forthcoming EU referendum debate of treating it like a “public relations campaign”.
“One should be very cautious of precise, numerical estimates of what the consequences would be,” Mr King warned in an interview with Bloomberg, in a reference to Government analysis published this week.
The Treasury’s report estimated that the British economy would shrink by 6pc by 2030 if Britons voted to leave the EU on June 23.
Mr King’s successor, Mark Carney, said on Tuesday that he believed the economic techniques used to produce the report were to his mind an example of a “sound analytic process”.
However, Mr King said that the issue of the EU’s membership was a “big, big question”, and one that “that cannot be reduced, simply to the simple-minded level of a cost-benefit analysis”.
He continued: “I’m old enough to remember the referendum in Britain in 1975 on exactly the same issue. The one thing that both sides of the argument then were wrong about was that it would make a dramatic difference. It didn’t.
“I think it’s very important that people should not exaggerate the impact, either of staying in or of leaving.
“I do worry that people on both sides treating this as a public relations campaign rather than as a debate on the future of our country are inclined to exaggerate because they feel they are selling a position.
“What is more important is that we have a calm and reflective debate about the role of Britain in Europe. Our relationship with a continent which we have struggled with for several hundred years.”