Osborne: UK faces economic ‘adjustment’

Chancellor George Osborne said the UK economy will see an ‘adjustment’ following the UK vote to leave the European Union but stressed that the public and private sectors have extensive contingency plans in place to deal with the volatility.

Chancellor of the Exchequer George Osborne delivers a speech on the potential economic impact to the UK on leaving the European Union

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George Osborne delivers a speech on the potential economic impact to the UK on leaving the European Union on May 23

Osborne, who campaigned with Prime Minister David Cameron to remain in the EU, said he did not “resile from any of the concerns” expressed during the campaign but pledged to do everything he could “to make it work.”

He said: “I want to reassure the British people and the global community that Britain has the strongest major advanced economy in the world. I said we needed to fix the roof for whatever the future held and thank goodness we did.”

Osborne reiterated that the Bank of England stands ready to inject £250 billion into the economy and he said the Treasury has been in regular contact with the bank, the Financial Conduct Authority and financial institutions to deal with the consequences of the vote.

The referendum will impact the public finances but he said it is unclear what actions will be taken at this stage.

Osborne said: “There will be an adjustment in the British economy. It will have an impact on our public finances. There will have to be action but I think it perfectly sensible to wait until the autumn.”

Osborne said Article 50, which will begin the process for an EU exit, will not be triggered until there’s “a clear view what we are seeking” with other European nations.

The Chancellor also pledged to play an “active part” in the debate over trade and said he would provide an update about his role in the Conservative Party in the coming days.

Osborne has previously claimed that an exit from the EU would make Britain “permanently poorer” and cost every household the equivalent of £4,300 a year.

In a stark warning ahead of the vote, he said a Brexit could lead to a £30 billion hole in public finances, triggering tax hikes and spending cuts.

• This article also appeared on WSJ City, a made-for-mobile app that combines the best of The Wall Street Journal and Financial News, tailored for an audience in the City of London. Download here

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