Prime Minister Theresa May delivered her long awaited Brexit speech today, and amid the flurry of reaction, what the plan will mean for SMEs remains unclear. However, the FSB, for one, offered a cautious welcome to May’s plans for what many are calling a ‘hard Brexit’, with its chairman Mike Cherry welcoming the government’s ‘clear intention for transitional arrangements beyond the two year fixed period’ but demanding a pro-business approach in any negotiations.
“Today we wanted to see the Prime Minister begin to sketch out a ‘pro-business Brexit’ by addressing trade, talent and transitional arrangements. ,” Cherry said. “93 per cent of our exporting members export directly to the single market. Our members want to see this bold and ambitious Free Trade Agreement (FTA) so that they can continue to trade and operate within European markets. However, we will push the Government to guarantee whatever transition process is put in place ensures there is no cliff edge or gap in trade.
“One in five (21%) FSB members export. This could be doubled with the right tailored small business support from the Department for International Trade along with new FTAs with the fastest growing markets in the world. Global trade will only flourish if the FTAs prevent additional barriers, such as cost and paperwork. “Small employers will welcome the pledge to maintain the UK as a true magnet for international talent. We have pressed the Government hard to guarantee the right to remain for non-UK EU nationals in existing workforces, and no early cut-off date. Any future system must help small firms to easily recruit the right person, for the right job, at the right time.
“The Prime Minister’s other objectives show that there is a clear intention for transitional arrangements beyond the two year fixed period. We welcome the legislative certainty that comes with the Great Repeal Bill, to maintain the regulatory framework in the medium-term by incorporating EU law into UK law. After that, FSB will push Government and Parliament for the radical reform of the regulatory burden for small businesses.”
‘Time to deliver’
Meanwhile the CBI described the speech as clear, and called for government to ‘deliver these objectives and achieve a smooth and orderly exit’ “Today the Prime Minister changed the landscape,” said CBI DG Carolyn Fairbairn. “Ruling out membership of the Single Market has reduced options for maintaining a barrier-free trading relationship between the UK and the EU. But businesses will welcome the greater clarity and the ambition to create a more prosperous, open and global Britain, with the freest possible trade between the UK and the EU.
“The pressure is now on to deliver these objectives and achieve a smooth and orderly exit. Businesses want to make a success of Brexit but will be concerned about falling back on damaging WTO rules. They stand ready to support the negotiations to get the best possible deal for the UK by ensuring that the economic case is heard loud and clear.”
Elsewhere reaction was even more mixed. “Brexit means Brexit” is more clear than ever after May’s speech this afternoon,” said Niels Turfboer, managing director of asset finance provider Spotcap UK. “The strength and support of 65 million people and the UK’s 5,4 million SMEs are reasons to believe that the transition to “A Global Britain” will be a successful one. The most compelling argument for why we should assume this will happen is that the incentive for both the EU and the UK is the same – maximising prosperity – which will only be possible by developing a new strong partnership. The majority of SMEs in the UK export to the EU, which is why access to the Single Market and trade deals with non-EU countries need to be key priorities during the negotiation and transition period.”