Costing Brexit: what is Whitehall spending on exiting the EU?

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Series Details March 2018
Publication Date March 2018
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The Institute for Government is an independent charity in the United Kingdom working to increase government effectiveness.

It works with all the main political parties at Westminster and with senior civil servants in Whitehall. It provides evidence based advice that draws on best practice from around the world.

The Institute for Government is a registered charity in England and Wales (Registered Charity No.1123926).

The charitable objectives of the Institute are:

+ The advancement of education in the art and science of government in the UK for the benefit of the public and on a non-party political basis;
+ The promotion of efficient public administration of government and public service in the UK by providing programmes of education, training, research and study for the public benefit and on a non-party political basis.
The vote to leave the European Union (EU) was leaving a lasting impression on the shape and size of Whitehall. There are new departments, new priorities and thousands of new civil servants.

These changes don’t come without cost. After years of strict controls on departmental budgets, the Chancellor was loosening the purse strings. In the 2017 Autumn Budget, he announced that an extra £250m had been shared among departments in 2017/18, and a further £3bn has been set aside to fund Brexit over the next two years.

This IfG Insight paper looked at six of the government departments most affected by Brexit in order to understand where this money was going and what else Whitehall was spending on leaving the EU. It showed that the Treasury numbers only tell part of the story.

As well as the two new departments set up in the summer of 2016 – the Department for Exiting the European Union (DExEU) and the Department for International Trade (DIT) – the paper looks at the four other departments most impacted by Brexit: the Department for Business, Energy and Industrial Strategy (BEIS), the Department for Environment, Food and Rural Affairs (Defra), the Home Office, and Her Majesty’s Revenue and Customs (HMRC).

In total the IfG report suggested that Whitehall would spend around £2bn on its Brexit preparations by the time the UK actually left the EU in March 2019.

Greater clarity on money to be spent on Brexit-related preparations in 2018-19 came after the Spring Statement made by the Chancellor of the Exchequer on the 14 March 2018. Over £1.5bn was allocated to departments and devolved administrations to prepare for Brexit in 2018-19

[This focus on administrative costs is separate to the issue of the costs of the 'financial settlement' with the EU]

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Related Links
UK: NAO: Tag: European Union
The Guardian, 13.07.17: Brexit plans could fall apart 'like a chocolate orange', says auditor general
IfG: Summary, March 2018: Costing Brexit
United Kingdom: House of Commons: Public Accounts Committee: 18th Report (2017-19) HC467: Exiting the European Union
ESO: In Focus: Brexit - The United Kingdom and the European Union
IfG: Comment, 14.03.18: Whitehall steps up a Brexit gear
UK: Parliament: Publications & records: Written Questions and Answers and Written Statements: Spring Statement:Written statement - HCWS540, March 2018

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