The costs of Brexit are gradually becoming clear

After weeks of those gnawingly bland "Brexit means Brexit" assurances Theresa May finally caved in to the growing pressure last week and set out to clarify the Government's position. We now know that the UK will be leaving the Single Market, putting to an end to the hope that 'passporting rights' for banking services could be retained after Brexit. Since then most large banks have gone public with the worst-kept secret in the Square Mile - namely that they have been scouting various EU cities in the hunt for new locations in which to headquarter their European operations ("Citi plans Brexit job move", "Banks plan Brexit exodus", "City banks warn of Brexit job moves").

While there will not be many people shedding tears over the likelihood that tens of thousands of banking jobs may disappear from the City of London over the next decade, the loss of tax revenues should certainly concern them. The City contributes £60bn a year in tax revenues to the UK Treasury (11% of the overall tax take); the net cost to the UK of EU membership is £8-9bn annually. If HMRC were to lose only 15% of that £60bn tax revenue then the act of leaving the EU will come with a net cost attached. So much for £350m a week extra to spend on the NHS.

To look at the specifics, according to this article from the Daily Mail - "Anger over £250,000 average wage at investment bank Goldman Sachs" the average pay at Goldman Sachs is £250,000 per year. Now it's probably safe to assume that the Daily Fail has manipulated the figures somewhat for the purposes of the article, as is it's wont - so let's assume the average is closer to £200k. Someone earning 200k per year will be paying around £83000 per year in tax and national insurance contributions. By contrast, someone on the average UK salary will pay only around £5500 in tax and NI. So for every job permanently lost from the City, the UK will need to create 15 at the national average wage simply to replace the lost tax revenue. That's a lot of extra jobs to create in an as yet unspecified booming area of growth. And that does not even take into account the collective demand that the individuals occupying those new positions will place upon the national infrastructure - one taxpayer vs fifteen taxpayers, one taxpayer's children vs 15 taxpayers' children, one pensioner vs fifteen pensioners.

There is also the unanswered question of where the employees to occupy these replacement roles will come from - we are clamping down on immigration apparently, so are these roles to go unfilled, as we are already close to full employment? Will the hit to the Treasury's revenues therefore be permanent and, if so, which services will be cut as a consequence? Or is Theresa May going to have to renege on the promises made on immigration by Leavers during the campaign?

With each passing day, as more details of the post-Brexit landscape emerge, it is looking more and more as though we have taken a foolhardy gamble.