Business patience on Brexit is 'threadbare'

22 October 2018

The majority of businesses with Brexit contingency plans will put them into action by December if there is no certainty over Brexit.

survey of businesses by the Confederation of British Industry (CBI) found 58% had formed contingency plans in case of a no-deal scenario, with the majority being forced to implement them by December if no futher certainty is established.

Almost a third of those contingency plans (30%) include the intention to relocate production and services outside the UK.

Carolyn Fairbairn, CBI director-general, said businesses’ patience with Brexit negotiations was “threadbare”.

For 19% of businesses surveyed, the deadline to halt contingency plans has already passed. For 15%, the date to halt further implementation is October, for 24% it is November, and for another 24% it is December.

“The situation is now urgent. The speed of negotiations is being outpaced by the reality firms are facing on the ground,” she said.

“Unless a withdrawal agreement is locked down by December, firms will press the button on their contingency plans. Jobs will be lost and supply chains moved.

“Businesses have displayed remarkable resilience since the referendum, but patience is now threadbare.”

The survey of 236 firms, including 101 large companies and 135 SMEs, also found a quarter intend to stockpile goods.

Last month, the Centre for Economics and Business Research predicted the knock-on effects of no-deal Brexit stockpiling would “almost inevitably” cause a mini-recession.

The CBI survey also found eight out of 10 firms reported Brexit as having a “negative effect on investment decisions”, while 66% said Brexit has impacted on the attractiveness of the UK as a place to invest. 

A lack of certainty caused by the slow rate at which talks have progressed between the UK and the EU was cited as the reason for the changes.

The survey was carried out between 19 September and 8 October.

Last week Theresa May hinted that the transition period after Brexit could be lengthened by “a matter of months”.

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