Employment minister Priti Patel has launched a stinging attack on Osborne and Lagarde following Brexit recession warnings

 
Jake Cordell
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The battle within the Conservative Party is getting increasingly out of control as the EU referendum draws nera
The battle within the Conservative Party is getting increasingly out of control as the EU referendum draws nera (Source: Getty)

One of George Osborne's cabinet colleagues has accused the chancellor of "cashing in favours" from the International Monetary Fund (IMF) over its warning that Brexit could trigger a recession.

Priti Patel, the employment minister, who used to work in the Treasury with Osborne, said:

"The EU-funded IMF should not interfere in our democratic debate ... It appears the chancellor is cashing in favours to [Christine] Lagarde in order to encourage the IMF to bully the British people."

The comments came in response to Lagarde's claims that a vote to leave the European Union would push up prices, cause volatility on the financial markets and could push the UK into an economic downturn.

The IMF also confirmed today that it will publish controversial analysis of how the UK would fare outside the EU in a number of different scenarios less than one week before the EU referendum on 23 June.

Patel rubbished the IMF's previous predictions and said the British people should dismiss today's comments:

"The IMF warned Britain it was playing with fire when it set out a plan to deal with the deficit. Now our economy is stronger than nearly every other major economy. Today, the IMF is talking down Britain because we want to take back control from Brussels. They were wrong then and they are wrong now."

Read more: George Osborne happy to talk to the IMF about Brexit, but don't mention the A-word

The bust-up represents the second high-profile battle between Leave campaigners and a major institution in as many days. Yesterday, former chancellor Lord Lamont launched an unprecedented attack on the independence of Bank of England governor Mark Carney following similar warnings issued yesterday.

It is also just the latest fracas between Conservative colleagues over the issue, as the debate turns increasingly bitter in the final few weeks of campaigning. Earlier this week Iain Duncan Smith called for the Treasury - the chancellor's own department - to be broken-up, branding it was the "worst thing in Britain".

The accusation of "cashing in favours" refers to Lagarde's recent reappointment as managing director of the IMF, for which she was unopposed. Osborne sees Lagarde as a key ally - backing her initial appointment in 2011 and publicly campaigning to help her to secure a second term.

Leave campaigners assert that Lagarde is now helping the chancellor to secure a vote to remain in the European Union as a way of thanking him for his support.

"The government is planning to circumvent purdah rules [which place restrictions on campaigning before the vote] by using the IMF, which is funded by the EU and the UK government," the group said.

"Lagarde is an employee of Osborne ... a long-standing pro-EU campaigner, who believes the law should not be followed when it is inconvenient," Vote Leave added.

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