Brexit flotilla sails through London after govt's budget warning

A boat decorated with flags and banners from the "Fishing for Leave"sails by the British Houses of Parliament as part of a "Brexit flotilla" on the river Thames in London on June 15, 2016.
A boat decorated with flags and banners from the "Fishing for Leave"sails by the British Houses of Parliament as part of a "Brexit flotilla" on the river Thames in London on June 15, 2016.PHOTO: AFP
A boat flying a large "In" flag sails by the British Houses of Parliament to meet a flotilla of boats from the group "Fishing for Leave" on the river Thames in London on June 15, 2016.
A boat flying a large "In" flag sails by the British Houses of Parliament to meet a flotilla of boats from the group "Fishing for Leave" on the river Thames in London on June 15, 2016.PHOTO: AFP

LONDON  (AFP) – A flotilla of pro-Brexit fishing boats sailed up the River Thames Wednesday (June 15) ahead of next week’s knife-edge referendum over EU membership, as the government warned of tax hikes and spending cuts if Britain voted to leave.

UK Independence Party leader Nigel Farage joined the procession of around 30 trawlers that steamed past parliament to protest against EU fishing quotas while Prime Minister David Cameron was facing MPs in his final debate before the June 23 vote.

“The battle line of this referendum is ordinary folk and their communities up against the big establishment,” Farage told AFP on board one of the boats which was decorated with Union Jack deckchairs and balloons.

Events took a bizarre turn when rocker and Live Aid mastermind Bob Geldof, a “Remain” supporter, pulled up in a rival boat, shouting “Nigel you’re a fraud” through a loudspeaker, only to be hosed with water from a “Leave” boat.

“The Only Way is Brexit” and “Leave, Save Our Country” read some of the signs on the pro-Brexit boats, while a flag on Westminster Bridge read: “Don’t Let Farage Sink Britain, Vote Remain”.

Meanwhile, finance minister George Osborne, who is campaigning for Britain to remain in the 28-member bloc, said that schools, hospitals and the army would all have their funding slashed if Britons vote to leave.

In the government’s starkest warning yet of the economic implications of a Brexit, Osborne said leaving the bloc would blast a £30-billion (S$57.6-billion) hole in national finances.

In response, the basic rate of income tax would be raised, inheritance tax would be hiked, and the budget for services including the National Health Service (NHS) would be cut, he said.

“Quitting the EU would hit investment, hurt families and harm the British economy,” he said.

“I would have a responsibility to try to restore stability to the public finances and that would mean an emergency budget where we would have to increase taxes and cut spending.”

Osborne was joined by former finance minister Alistair Darling from the opposition Labour Party, who was in charge of Britain’s economy during the 2008 financial crisis.

“I am even more worried now than I was in 2008,” Darling said.

Osborne’s warning came as opinion polls indicate a surge of support for the Brexit camp, putting pressure on global markets.

But deputies from Osborne’s own Conservative party slammed the “blackmail budget” and vowed to vote against it.

Fifty-seven Tory MPs said Osborne’s warning was the result of a “reckless teenage temper tantrum” and that his job was under threat if he pushed ahead with the plans.

“If the chancellor is serious then we cannot possibly allow this to go ahead,” said the statement. “If he were to proceed with these proposals, the chancellor’s position would become untenable.” 

Labour party leader Jeremy Corbyn also vowed to oppose such a budget during Cameron’s weekly grilling on Wednesday, the last day of parliament before the vote.

The pro-Brexit camp also unveiled its blueprint for a post-EU Britain, in which it vowed to channel EU contributions to the NHS, end the free movement of people from the EU and try to secure a trade deal with Europe by 2020.

Investors have responded to the pro-Brexit momentum by selling stocks and putting their money in safe havens, with Europe’s main markets down sharply on Tuesday – although rebounding slightly at the opening Wednesday – and the euro hitting a three-and-a-half year low.

Reflecting business uncertainty, engineering giant Rolls Royce on Wednesday urged staff to vote to stay in the union, warning in a letter that “as a company with three quarters of our workforce based in the EU, we have a clear interest in this debate”.

However, official figures released Wednesday showed that unemployment had fallen to an eight-year low, soothing some fears that investment decisions were being put off due to the referendum uncertainty.

As the campaign enters its final stretch, a poll by ComRes showed the race on a knife edge, with support for remaining at 46 per cent and the pro-Brexit side at 45 per cent.

This contrasts with a result from the same pollster just one month earlier in which the pro-remain side had an 11-point lead.