Business chiefs unite in call for ‘urgent’ transition deal
Leaders of five major business institutions call for rapid response by the UK government over a Brexit transitional deal. Concerns mount as businesses consider relocation to other EU countries.
23 October 2017
UK business leaders are ratcheting up pressure on the government with a letter warning of “serious” consequences for jobs and investment unless a transitional Brexit deal is reached as a matter of urgency.
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Mr Khan said the government needed to secure agreement on the plans for a transitional deal as soon as possible otherwise “my fear is other businesses could be thinking about leaving London”. He added, “There are some banks who have already gone public about having to make contingency plans.”A spokesman for the Department for Exiting the EU said, “The prime minister proposed a strictly time-limited implementation period in her Florence speech and was clear in her Article 50 letter that agreeing this principle early in the process would help minimise unnecessary disruption to businesses in both the UK and the EU.“We are making real and tangible progress in a number of vital areas in negotiations. However, many of the issues that remain are linked to the discussions we need to have on our future relationship.“That is why we are pleased that the EU has now agreed to start internal preparatory discussions on the framework for transitional arrangements as well as our future partnership.”In a separate move on Monday, the BCC urged Chancellor of the Exchequer Philip Hammond to concentrate on helping businesses prepare for Brexit in next month’s Budget rather than prioritising “goodies and giveaways”.
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Relocation of businesses reaching tipping point as lobby groups send letter
In a letter to Brexit Secretary David Davis and leaked to Sky News, the UK’s five largest business lobby groups – the Confederation of British Industry, the Institute of Directors, the manufacturers’ organisation EEF, the British Chambers of Commerce (BCC) and the Federation of Small Businesses – also say that the deal must match as closely as possible current trading arrangements with the EU.The letter says that unless such an agreement is speedily reached, companies will reach “serious decisions” in the coming months to relocate jobs out of the UK.“Agreement (on a transition) is needed as soon as possible, as companies are preparing to make serious decisions at the start of 2018, which will have consequences for jobs and investment in the UK,” the letter says.“And the details of any transitional arrangement matter: the economic relationship the UK and EU has during this time-limited period must match as close as possible the status quo.”The letter – which represents the first time all five of the groups have united to lobby ministers on Brexit – says ministers must aim to maintain the UK’s existing economic participation in the single market and “the current terms of a customs union” during transition.“This would provide the greatest economic continuity and could be agreed quickly, ensuring discussions could move swiftly on to our long-term future relationship with the EU,” they say without specifying a time period for the transitional arrangements, only arguing for it to “last until a new (trade) deal is in force and gives enough time to adjust”.The letter also says that while accepting new EU regulation and European Court of Justice ruling during any transition would cause “political challenges” in the UK, “failure to do so would create legal confusion and regulatory hurdles, undermining the effectiveness of the transitional arrangement and the certainty it seeks to provide”.The mayor of London joined businesses in concern over transition
Sadiq Khan, the London mayor, also joined the call on Monday for a transition deal to be reached as speedily as possible, warning that the capital would face an exodus of businesses unless there was clarity on the future of UK-EU trade arrangements.Interviewed on BBC Radio 4’s Today programme, Mr Khan was questioned about a tweet last week from Lloyd Blankfein, chief executive of Goldman Sachs, who seemed to suggest the bank’s future was in Frankfurt, not London where it currently employs 6,500 staff.Mr Blankfein wrote, “Just left Frankfurt. Great meetings, great weather, really enjoyed it. Good, because I’ll be spending a lot more time there.”The mayor said, “To be fair to the chief executive of Goldman Sachs, he is articulating publicly what many CEOs, investors and people who love working in London have been saying privately, which is that, unless they have certainty about what happens after March 2019, they have got to make a plan B.”Related stories:
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Mr Khan said the government needed to secure agreement on the plans for a transitional deal as soon as possible otherwise “my fear is other businesses could be thinking about leaving London”. He added, “There are some banks who have already gone public about having to make contingency plans.”A spokesman for the Department for Exiting the EU said, “The prime minister proposed a strictly time-limited implementation period in her Florence speech and was clear in her Article 50 letter that agreeing this principle early in the process would help minimise unnecessary disruption to businesses in both the UK and the EU.“We are making real and tangible progress in a number of vital areas in negotiations. However, many of the issues that remain are linked to the discussions we need to have on our future relationship.“That is why we are pleased that the EU has now agreed to start internal preparatory discussions on the framework for transitional arrangements as well as our future partnership.”In a separate move on Monday, the BCC urged Chancellor of the Exchequer Philip Hammond to concentrate on helping businesses prepare for Brexit in next month’s Budget rather than prioritising “goodies and giveaways”.
British Chambers of Commerce call for bold Autumn budget
Adam Marshall, BCC director-general, said, “At a critical moment for the UK economy, the chancellor must be bold and deliver a big budget that prioritises economic confidence and investment.“The best possible Brexit deal won’t be worth the paper it’s written on if conditions for growth aren’t right here at home. The chancellor has a unique chance to move the dial on growth and productivity now, leaving the UK in a position to succeed over the long term.“Action to slash the up-front costs faced by business, to incentivise investment, and to improve mobile coverage and infrastructure would lead to a real boost to productivity, wages and trade.“A Budget that prioritises goodies and giveaways rather than future-proofing the economy would be a dereliction of duty by the government as a whole.”For related news and features, visit our Immigration section.Relocate’s new Global Mobility Toolkit provides free information, practical advice and support for HR, global mobility managers and global teams operating overseas.Access hundreds of global services and suppliers in our Online Directory ©2024 Re:locate magazine, published by Profile Locations, Spray Hill, Hastings Road, Lamberhurst, Kent TN3 8JB. All rights reserved. This publication (or any part thereof) may not be reproduced in any form without the prior written permission of Profile Locations. Profile Locations accepts no liability for the accuracy of the contents or any opinions expressed herein.
