The outliers in these predictions are related to either overly optimistic or pessimistic Brexit scenarios. Looking at the full set of data, the range is predicted to be around 0.30%, or if those two extreme scenarios are excluded then it gives a muted average range of 0.23%. The primary risk factors for bonds to cheapen versus swaps is the (ever increasing) possibility of a disorderly Brexit, including but not limited to marked GDP falls, rising unemployment, inflationary currency and falls in property prices which have both a negative emotional and financial impact on the average UK homeowner. A potential general election leading to a Labour Government is seen as extremely negative for gilts as many question the fiscal rectitude of some of their stated policies. Consequently, a knock-on impact could be a revision of official borrowing requirements to meet a fiscal expansion. Other factors include reduced demand for gilts as swaps regain popularity, repo costs increasing or transfers out into DC schemes and falls in longevity assumptions.
On the other hand, a hard (yet not disorderly) Brexit could result in lower rates as the BoE push back their plans to normalise the base rate which would likely push gilts to more expensive levels versus swaps. The BoE may even feel moved to restart QE; certainly the expected reinvestment of maturing bonds and coupons is at extreme levels (c. £21bn) and due to be invested over the (currently scheduled) Brexit date which will put some pressure on asset swap spreads.
Much of the buy-out activity is dependent on funding ratios and the appetite of corporates to pay the premium: if these take a turn for the worse (global slowdown) then those pension funds in phase one could switch into bonds yet not complete the transfer. With easy access to repo balance sheet demand for gilts will likely outstrip equivalent swaps particularly if there are lingering concerns over central clearing and the LIBOR fall-back. The impact of foreign investors could again tend towards purchases, particularly if currency rebalances and global tensions rise.