EU referendum: Cameron issues Brexit pensions warning

David Cameron has said the government might not be able to protect spending on pensions, the NHS and defence in the long term if the UK leaves the EU.

The prime minister said Brexit could cause a "black hole" in the public finances and threaten the "triple lock" guaranteeing state pension increases.

He told Andrew Marr "our economy would be smaller" if the UK left the single market leading to "difficult choices".

Vote Leave said it was "a frantic attempt to rescue a failing campaign".

In other developments with less than a fortnight to go before the referendum on the UK's EU membership on 23 June

On the penultimate weekend before the crunch vote, Mr Cameron has used a series of newspaper articles to warn of the financial consequences of Brexit, saying ring-fenced future funding in a number of areas could be at risk.

On the BBC's The Andrew Marr Show, Mr Cameron said forecasts from the Institute for Fiscal Studies suggested Brexit could lead to a shortfall in the public finances of between £20bn and £40bn which would need to be "filled" — either by tax rises, borrowing or spending cuts.

In their 2015 election manifesto, the Conservatives promised to extend the so-called triple lock on state pensions, a guarantee that they rise every year by at least 2.5% — or the rate of inflation or wage growth if it is higher — until 2020.

While pensioner benefits were a "policy priority" and he was committed to honouring manifesto promises, the PM said £90bn was spent on it every year and it was among many existing commitments that would have to be re-examined in a post-Brexit climate.

"Our pensions promise is based on a growing and succeeding economy," he said. "All the experts… agree that if we leave the single market, if we cut ourselves off from the most important market, our economy would be smaller and that has consequences.

"We would taking a risk with growth, with jobs and with pensions. We shouldn't do that — it is the wrong choice."

At least part of the referendum campaign goes something like this: the prime minister pops up and warns about the dangers of Brexit and a cabinet, or ex-cabinet, colleague denounces him.

So when he said promises to protect spending on health, defence and pensions may have to be ditched in the next Parliament if we leave the EU, it was unsurprising that the former Work and Pensions Secretary Iain Duncan Smith called this "vindictive".

But I'm told we may be nearing the end of this rather predictable pattern.

Some in the Remain camp believe this approach has run its course and may even have alienated some potential voters.

So I am told that in the coming week we may see less of the prime minister — and the subsequent attacks from his own colleagues — and more from senior Labour figures, past and present.

"Blue on Blue" verbal violence could be replaced by a Red Alert.

Remain sources know that a majority of Labour supporters oppose leaving the EU, but might not turn out to vote.

And they know messages about protecting workers' rights and warnings about a post Brexit rightwards shift in the Conservative Party are more convincing coming from opposition voices than the lips of David Cameron.

While he would "carry out" the people's instructions if they voted to leave on 23 June, Mr Cameron said two years of exit negotiations would "suck the energy out of the government and our country when we should be taking on the world and winning".

And he declined to say whether, while remaining as prime minister after a Leave vote, he would implement Vote Leave's plans for an Australian-style points-based immigration system and other proposals, such as cuts to VAT on household energy.

"If we vote to leave, will I carry on as prime minister? Yes. Will I construct a government which includes all the talents of the Conservative Party? Yes. Do I think it is the right course for our country? No I don't."

Meanwhile, Chancellor George Osborne said the armed forces could see their budgets slashed by £1-1.5bn a year as the wider economy shrank, telling the Sun on Sunday that Brexit would mean "a new dose of austerity, more years of public spending cuts".

He said: "It's the last thing I want to do because I want the country to stay in the European Union, but if we leave the European Union Britain is smaller and so Britain's armed forces will be smaller and that means fewer planes and ships and personnel to defend us.

"So it is both a hit to our national economic security but also our 
national security."

'Vindictive and desperate'
But Pro-Brexit ex-cabinet minister Iain Duncan Smith accused his party leader of a "vindictive and desperate attempt to bully and frighten the British people".

"This is a baseless threat," he said. "The truth is that these are policy choices and the Conservative manifesto said that protecting pensioners was a priority.

"It is now apparent that there is nothing they will not use or jettison in their efforts to keep us in the European Union."

And UKIP leader Nigel Farage suggested that voters did not take kindly to being threatened about the risks of Brexit, telling Andrew Marr that if the pound fell slightly after Brexit, "So what?" — since it was a fluctuating currency and exports would benefit.

"People have had enough of being threatened by the prime minister and the chancellor and I think collectively people are beginning to put two fingers up to the political class," he said.

Meanwhile, the Archbishop of Canterbury has said he will be voting for the UK to remain in the EU, adding that Britain should be "a country for the world" and warned against "succumbing to our worst instincts" over immigration.

Writing in the Mail on Sunday, the head of the Church of England, the Most Rev Justin Welby, said he would vote to stay in the EU to avert economic damage that could harm the poorest.

"We each have to make up our own minds," he said. "But for my part, based on what I have said and on what I have experienced, I shall vote to remain."