UK business and industry statement on Brexit is all bark and no bite

The UK’s top five industry and business federations have issued a strong statement criticising Brexit. But beyond first glance, is there much substance to it, asks Denis MacShane.
Photo Credit: Press Association

By Denis MacShane

Denis MacShane is a former UK Minister of Europe

03 Jan 2019

@DenisMacShane

The UK’s top five industry and business federations declared they were “watching in horror as politicians have focused on factional disputes rather than practical steps that business needs to move forward”.

Between them, the Confederation of British Industry (CBI), the British Chambers of Commerce (BCC), the Federation of Small Businesses (FSB), the manufacturers’ association EEF and the Institute of Directors (IOD) represent the great majority of businesses operating in the UK.

That includes most foreign direct investment firms who opened up shop here on the solemn promise from Margaret Thatcher, and all her successors up to the present prime minister, that the UK would guarantee full access to the EU single market of 450m consumers.

That these organisations have combined to issue such a dramatic call is significant. “Watching with horror” is not language we have heard from business before.

But what exactly are they “watching with horror”?

Is it May’s deal, with its political declaration containing endless contradictory statements that require years of tense, tetchy negotiations with 27 EU member states before the UK has the faintest idea of what its future trading relationship with Europe is?

Is it the sight of the Tory party holding a leadership election to oust the Prime Minister at a time of national crisis?

“By nature business leaders lean to the right. Since July 2016, they have been reluctant to say anything that appeared to criticise the handling of Brexit by Tory ministers”

Is it horror at the complete absence of leadership and policy from the Labour party?

And what exactly is the business alternative?

Many big firms, as well as the CBI, were loudly supportive of the government’s deal. They seem to have no political advisors to tell them it was never going to get through the Commons in December, and is unlikely to this month either.

Inside the CBI, trade specialists told their senior managers that the government’s deal was unworkable in terms of trade access, as indeed it is.

But by nature business leaders lean to the right. Since July 2016, they have been reluctant to say anything that appeared to criticise the handling of Brexit by Tory ministers.

The BCC’s problems are even more acute. Their membership is located in English towns and smaller cities, where sentiment in recent years has been heavily influenced by the anti-EU propaganda of the Daily Telegraph, Sun and until recently the Daily Mail.

Can this omerta change?

There was certainly leadership on offer from business figures, including several former CEOs, who issued a statement calling on the prime minister to “take her deal to the British people”.

In contrast, the CBI/BCC/EEF/FSB/IOD statement is vivid in language but weak in alternatives.

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