No deal Brexit plans ‘better late than never’, business groups tell government

Cliff edge Brexit still worst option, organisations warn, but companies want to start making their own plans 

Caitlin Morrison@citycait
Wednesday 22 August 2018 17:00
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What does a no-deal Brexit mean?

The government’s guidance on a potential no deal Brexit is “better late than never”, business groups said ahead of publication of MPs’ plans on Thursday.

Among the so-called technical notices set to be published is an impact paper detailing the possible scenario for the financial services industry.

The plan for banks and businesses was not expected to be among the first batch of notices released, as it likely to stir up controversy.

However, companies have been calling out for more clarity on the future for months now, and on Wednesday, business groups issued a cautious welcome in anticipation of more details on how industry will be affected if the UK crashes out of the EU with no agreement in place.

Adam Marshall, director general of the British Chambers of Commerce, said: “Businesses have waited too long for answers to some basic questions around Brexit - and have been particularly frustrated by the lack of clear guidance on some of the issues that are within the UK government’s own control.

“‘No deal’ preparations should have happened far earlier, and the onus is on government to move quickly and give businesses as much detailed technical information as possible to avoid significant disruption in any scenario.”

Mr Marshall said it will assess the government’s plans on the basis of whether firms “have the clarity they need so that they can continue to conduct business both here at home and across borders on 30 March 2019”, and said the BCC “will not hesitate to tell ministers if we find the content unclear or unhelpful to business decision-making”.

Allie Renison, head of Europe and trade policy at the Institute of Directors, said: ““The publication of no-deal guidance has been a long time coming, but it’s better late than never.

“While a ‘no deal’ scenario would be bad for businesses, ‘no deal’ with no planning would be worse.”

She added that the way the notices are communicated and disseminated will be “just as important as their contents”, and said the government should ensure that the information “trickles down to all businesses in the supply chain, particularly to smaller firms which are typically less resourced, and are less likely to have made preparations so far”.

Mike Cherry, national chairman of the Federation of Small Businesses, agreed that smaller firms “will be the ones hardest hit by a disorderly exit from the EU”.

“Unlike bigger businesses, they do not have the resources or capacity in the short term to deal with a sudden and sweeping change to the way they do business,” he said.

“If you are a small business that trades with the EU or employs someone from the EU, or if you a self-employed EU citizen working in the UK, you need easily accessible information that will explain how a sudden Brexit will impact you and your business while providing practical steps to soften this impact.”

Mr Cherry added: “Engagement is critical to make sure that the UK’s small business community start preparing for a no deal Brexit and so that government gets a better understanding of the consequences of this scenario for the sector. This will allow them to put in place remedies, such as tax credits or export vouchers, to better support smaller firms if they are faced with a no deal Brexit.”

The FSB has previously warned that the government must “do everything in its power” to avoid a cliff-edge Brexit.

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