Brexit vote wipes £1.2 trillion off UK household finances in 2016

The UK has also lost 406,000 of its millionaires because of Brexit

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The Independent Online

The cost of Brexit to UK households has been put at $1.5 trillion (£1.2 trillion), according to a new report.

Household wealth in the UK slumped by 10 per cent, in the 12 months through June 2016, as a “direct result” of the Brexit vote, Swiss bank Credit Suisse revealed in its latest Global Wealth report on Tuesday.

This means wealth per adult has already dropped by $33,000 to $289,000 since the end of June.

This represents one of the biggest drops in wealth among major economies, with households in Turkey and Colombia faring better than those in the UK. Only households in Mexico, Egypt Russia, Ukraine and Argentina suffered from bigger losses than those in the UK.

The report, which is issued annually by Credit Suisse, said that the decline in wealth had a negative effect on the total number of millionaires in the UK. The country had lost 15 per cent, or about 400,000 people, of its millionaires during the period.

The dramatic plunge in wealth was driven by a fall in the value of the pound, which has lost about 18 per cent following UK’s decision to leave the EU.

Michael O’Sullivan of Credit Suisse, said: “The impact of the Brexit vote is widely thought of in terms of GDP (gross domestic product) but the impact on household wealth bears watching.

“Since the Brexit vote, UK household wealth has fallen by $1.5tn. Wealth per adult has already dropped by $33,000 to $289,000 since the end of June.

“In fact, in US dollar terms, 406,000 people in the UK are no longer millionaires.”

Inequality remains a major issue, according to Credit Suisse, with UK’s top 1 per cent of richest people continuing to own 24 per cent of the nation’s wealth.

“The wealthiest one per cent of the population – who own nearly a quarter of all the country’s wealth – continue to do well whilst so many people in Britain are just about managing to stay above the poverty line,” Oxfam spokesperson Sally Copley said.

Overall, global wealth across the world increased by $3.5 trillion to $265 trillion, the survey revealed.

Japan was the main winner with its total household wealth increasing 19 per cent to $24 trillion mainly due to the value of the yen rising against the dollar. Wealth in the US climbed to $85 trillion, marking the eight straight year of increase for the world’s largest economy.

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