The OBR announced that the pre-measures increase in cumulative borrowing by 2020/21 is forecast to be £100bn higher than otherwise, and £58.7bn was “related to the referendum result and exiting the EU” during this five-year period.

Brexit is expected to result in a cyclical slowdown, lower productivity and lower migration.

The National Institute of Economic and Social Research (NIESR) forecasts a short-term economic slowdown and a permanent loss in output as a result of leaving the EU.

This was reflected in Philip Hammond’s Autumn Statement and the NIESR welcomed this realistic assessment of the impact of Brexit.

However, it was critical that the Autumn Statement lacked an immediate response to the questions reflected in the Brexit vote.

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Of the £23bn National Productivity Investment Fund announced, most of the spending is back loaded with only £8.5bn being spent on non-housing investment over the next four years, while it felt there was nothing to address the skills problem in many regions of the UK.

"Brexit has had a very substantial impact on the OBR’s fiscal forecasts, as NIESR’s estimated,” said Dr Angus Armstrong, director of macroeconomics for NIESR.

“We welcome the chancellor’s more accommodating fiscal stance and pragmatism in reintroducing policy flexibility.”

“We had hoped for much more in terms of industrial strategy and to address the skills and output gap across the regions at the heart of long-term prosperity.”

Simon Kirby, head of macroeconomic modelling and forecasting at NIESR, felt the OBR’s latest forecasts made for sobering reading.

“They expect the economy to slow significantly over the course of the next year.

“Similar to NIESR’s projections published earlier this month, they expect per capita real disposable incomes to fall by 0.5% in 2017, as wage growth fails to track the pick-up currency depreciation-induced increase in consumer prices.”