David Cameron denies it was 'irresponsible' to risk crippling UK economy with EU referendum

The PM said he believed the referendum result could cause a huge economic shock to the UK but said it was still right to hold the vote

David Cameron (Photo by Frank Augstein-WPA Pool/Getty Images)

David Cameron has defended charges that it was “irresponsible” to hold the EU referendum despite it potentially causing major problems – arguing that he had “good reason” to do so.

Speaking at a press conference on a visit to the south coast the Prime Minister warned of “severe economic consequences” were the UK to vote to leave the bloc.

But questioned why he would hold a referendum in the first place if he believed Brexit could genuinely cripple to the UK economy, Mr Cameron said it wasn’t reasonable to hold a country in an organisation “against its will”.

“I absolutely think that if we vote to leave it’ll have these severe economic consequences, and it’s not just the Treasury that is saying that – the IMF, OECD, and Bank of England have all said it,” he said.

“In terms of holding the referendum, it is a pledge and a promise that I made, and for good reason – we’ve been in this organisation for 40 years, people of this generation haven’t been able to make the choice of whether to stay or to leave

“Europe has made changes over the years and you can’t hold a country in an organiastion against its will. I think we should welcome the fact that we’re having the big sovereign decisions by the British people.”

A report by the Treasury released this morning warned that the economic shock from Brexit would plunge Britain into a year-long recession and contract the economy by between 3.6 per cent and 6.0 per cent depending on the deal the UK reached.

Unemployment would rise between 1.6 per cent and 2.4 per cent, and real wages would also fall by as much as 4 per cent over the next two years, the analysis said.

Leave.EU and founder and Ukip donor Arron Banks has said it would be worth paying an economic price to leave the EU (Parliament TV)

The chancellor George Osborne said that such an economic shock would be a “DIY” recession caused by the UK’s own decision to leave the economic bloc. The predictions follow similar warnings from the OECD, IMF, and Bank of England.

Mr Cameron said he did not believe that such a shock would be worth other potential gains from leaving the EU.

“There are people out there who say yes, there would be a hit to our economy but it’s somehow worth it for other reasons. I’ve heard Nigel Farage, for instance, stay that many times. I profoundly disagree,” he said.

“We have a special deal in Europe and with that in mind it is certainly not worth the huge risk and downside to our economy of voting to leave. That is why I’m making this argument so vigorously every day for the next 30 days before we vote.”

Mr Cameron said he would hold an EU referendum before the last general election, after coming under sustained political pressure from eurosceptic members of the Conservative party.

Despite setting the official government position as in favour of Remain Mr Cameron has allowed Cabinet ministers to campaign in favour of Brexit.

The chief of one of the Brexit campaigns, Arron Banks, said last month that Treasury calculations that families would lose £450 a month from Brexit would be a price worth paying.

“This isn’t about pounds and pence, this is about our democracy,” he said, adding that he believed the figures were incorrect anyway.

Iain Duncan Smith, of Vote Leave, said he believed the calculations from the government department were a “deeply biased view of the future”.

“As George Osborne has himself admitted, the reason he created the independent forecaster, the OBR [Office for Budget Responsibility], was because by 2010 the public simply did not believe the government's own economic forecasts,” he warned.

“This Treasury document is not an honest assessment but a deeply biased view of the future and it should not be believed by anyone.”

Earlier in the referendum campaign Mr Cameron said he believed Britain could survive outside the European Union.

Britain will vote on whether to leave or remain in the EU on 23 June this year – around a month away.