Singapore-on-Thames

The Chancellor has stated that a hard Brexit - which he favours - will mean changing our economic model to one with low taxes and light regulation. Mr Hammond says these changes would be necessary in order to "regain competitiveness". This is the model that Singapore uses very successfully.

What would this mean for the person in the street - and more specifically for the employee in the factory?

Comparing economic and employment figures for Singapore with ones for the UK it is clear that this change will lead to a lot of pain.

Competitiveness means that prices are comparable for a similar quality of the goods. Mr Hammond is referring to international trade, where the UK sells manufactured goods rather than raw materials (as does Singapore).

As we will be trading under WTO rules we will have the same tariff barriers to our markets as Singapore does, so we need to compete by keeping the manufacturing cost down to a similar level to theirs.

In manufacturing the main cost is labour. So let us compare the figures:

Average weekly wage (manufacturing): Singapore £540 ............ UK £590
Average hours worked per week: Singapore 45 hours ............ UK 32 hours
Productivity of employees: Singapore 119 points ............ UK 102 points

Note that the productivity figures essentially mean that for every 102 widgets a UK worker produces a Singaporean will produce 119.

So if we suffer a hard Brexit and go into direct competition with Singapore (and other countries like it) we will need to improve our figures to match. The fastest way to reduce our prices to match theirs is to simply reduce wages - employees could choose to work longer hours and work more effectively in order to earn more.

To match Singapore would require a wage cut of between 40% and 45% (down to around £330 per week).

Meanwhile food prices are going up meaning the buying power of those reduced wages will be reduced even further, while tax rates will have to go up in order to maintain the tax take. However, doubling the tax rate would be politically impossible, so ever tighter austerity will need to be imposed - reducing funds for the NHS, education, benefits, pensions.

No doubt this is an attractive proposition for hard-line Brexiteers. Singapore is a successful alternative to the welfare state, with no NHS, no social housing, no state pensions, no state education. In Singapore the user pays - and tough if you can't pay.

If this is the road the Conservative party wish to take us down then we, the people, should have a voice - we, the people, should have a choice.