UK Business leaders have demanded that Brexit should be delayed if no trade deal is agreed by the end of the two-year negotiating period.
In a report on feedback from more than 400 businesses, the British Chamber of Commerce (BCC) has insisted that the government should delay triggering Article 50, if a trade deal cannot be agreed on within the two-year allowed period.
The BCC has also requested that the government should issue clarification for businesses on “residents’ rights of EU workers,” and for companies’ abilities to hire from EU countries once the UK leaves the single market.
Director general of the BCC Adam Marshall stated that: “Business communities across the UK want practical considerations, not ideology or politics, at the heart of the Government’s approach to Brexit negotiations.” “What’s debated in Westminster often isn’t what matters for most businesses.”
Prime Minister Theresa May has previously made assurances, that she is committed to avoid any “disruptive cliff edge” for businesses when Britain leaves the EU, however, the PM’s stance on a hard Brexit has created uncertainty in the business world, which has caused some companies to come up with contingent relocation strategies.
Chief executive to the Financial Conduct Authority, Andrew Bailey, penned a letter to the Treasury Select Committee last month, outlining the potential financial risks if the UK’s financial passport were to be suddenly rescinded in 2019 without any transitional arrangements in place for banks and asset managers.
There are already signs of UK businesses acting in response of an impending “hard Brexit.”
Professional services firm PwC released an unsettling report last week, stating that a third of UK manufacturing businesses are planning to move parts of their operations overseas.
In addition, several large banks in London have implied moving large parts of their operations to Europe after Brexit.
In an attempt to prevent businesses from being lumbered by significant costs post Brexit, the BCC has pleaded with the government to “aim to minimise tariffs, seek to avoid costly non-tariff barriers, grandfather existing EU free trade agreements with third countries, and expand the trade mission programme.”
The BCC has also advised, that the government should guarantee that the tax office is “appropriately resourced to help businesses through the transition process.”
On the subject of regulation, the BCC has demanded that the government ensures stability by integrating existing EU regulation with UK law. This also includes, making sure that UK products remain competitively priced and maintain the compliance standard currently in place.
The BCC concluded, urging the government to make sure that the UK continues to have access to the European Investment Bank in order to avoid a “funding cliff edge,” and does everything it can to prevent a return to “hard borders” with Northern Island that would hinder free movement of goods, services and people.
The message from the BCC is clear and should not be ignored or taken lightly. It is greatly important that the government works alongside businesses, by ensuring that a trade deal is agreed on before Article 50 is triggered. If an agreement is not made, it could spell severe consequences on the UK economy.