BRITAIN is almost half a trillion pounds poorer than originally thought after the Office for National Statistics (ONS) revised its estimates.

The UK has seen its stock of wealth collapse from a surplus of £469 billion to a net deficit of £22bn, around a quarter of gross domestic product (GDP).

And as Brexit talks reach a crucial stage, it seems we no longer have a reserve of foreign assets – therefore no safety margin.

Analysts have suggested that crashing out of the EU with no deal could see a further contraction in GDP of almost eight per cent, which would make it increasingly difficult for the government to defend against any run on the pound after Brexit.

The revision in the ONS’s “Blue Book” showed the country owns far fewer international assets and owes foreign investors far more than previously thought.

“Half a trillion pounds has gone missing. This is equivalent to 25 per cent of GDP,” said Mark Capleton, UK rates strategist at Bank of America.

Ian Blackford, the SNP’s Westminster leader, told The National: “At the stroke of a pen they have wiped out any surplus they thought they had.”

What he described as “an outbreak of self-harm” meant there was no longer any surplus on the country’s trading account.

Gemma Godfrey from investment website Moola said: “The Office of National Statistics have redone the figures and they are much lower than we thought.

“We thought they were in £469bn of surplus, but actually we have a £22bn deficit.

“That equates to a quarter of the value of the UK market in total. The reason behind this is that foreign direct investment in companies has fallen and our reserve of foreign assets is much smaller than we thought as well.

“The reason why this has been offset is two things. First of all, foreign investment has been slightly supported by existing commitments, so it hasn’t really fallen down until recently.

“And secondly, people have been buying a lot of sterling because they thought the pound was going to rise. But again, that’s quite fickle.

“The reason this is important is that it removes our safety net and also puts us in a weaker position when we’re going into Brexit talks.”

The news came just six weeks ahead of Philip Hammond’s first autumn budget – and Treasury officials are reportedly preparing themselves for “gloomy” forecasts. He is under increasing pressure to show how the country would handle a no-deal Brexit.

Richard Murphy, Professor of Practice in International Political Economy at City University, London, said: “The first appropriate reaction is to say that this is logical: of course the UK should be suffering because of its plan to leave the EU: nothing else would make sense.

“Second, the reaction is not to panic: this largely relates to corporate profits. The claim that this need impact the gilt market as the Telegraph claims need not be true: gilts are an option for a government and not a necessity, and so there need be no impact at all.

“Third, the importance of investing in national statistics becomes ever more clear... Fourth, then it is time to reappraise where the UK is. It’s not pretty, at all. The need for a Brexit deal is overwhelming. But who knows if it is on the cards.”

Murphy added it was then time to start asking questions: “Perhaps the most compelling is of the sectoral balances, because if the foreign sector is not supplying the support it was then the obvious question is who is substituting for them? This, right now, might be the biggest question of all.

“The foreign sector has been UK savers. If it isn’t any more and the government position is correctly stated what is happening in the UK domestic market? That’s not clear.”