The Prime Minister says Brexit will happen on October 31 regardless of whether there is a deal in place or not. MPs have voted several times in favour of rejecting a no-deal outcome. New legislation ostensibly requires the Prime Minister to seek an extension if there is still no deal by the October European Council summit.
These are some of the intractable facts that make business planning for Brexit seem paradoxical at best.
However, unless a Brexit deal is agreed in the coming weeks, EU treaty law and the terms of the EU Withdrawal Act 2018 point us towards a no-deal Brexit on October 31. Notwithstanding other legislation, this should be uppermost in businesses’ minds, and simply relying on Parliament to do otherwise is fraught with risk. The IoD will continue to stress to Government that the clear overwhelming view of its members is to avoid a no-deal exit, but sees its responsibility as also ensuring directors are taking preparation seriously.
With this in mind, the IoD is encouraging business leaders to plan for a no-deal outcome.
The IoD’s position, as the link between the government and the private sector, means that we are used to interpreting policy developments and translating them into a language which company directors understand. This is evidenced by the fact that the majority of members say our Business Planning for Brexit guide is useful in helping them to plan. We are therefore perfectly placed to help you navigate your business through a no-deal exit.
But we recognise that preparing your business for a no-deal scenario is no easy feat. We have a finger on the pulse of the director community so we know how you’re feeling, and that it can be daunting to navigate all the known and unknown unknowns of trying to plan in advance of such an outcome.
We know, for example, that the majority of you think a no-deal Brexit would be more negative for your firm than a further extension, but that neither is particularly ideal for resolving uncertainty. We know that three-quarters of you would prefer to leave with a deal ratified, allowing for a transition period thereafter to adjust to long-term trading arrangements. We know that just 14% of you feel your business is fully prepared for a no-deal exit – and that SMEs are around half as likely as their large counterparts to report feeling this way.
Workshops and webinars
The IoD has been providing Brexit guidance to the UK business community since before the referendum – but we are now accelerating these activities. This includes re-launching our Brexit Hub today along with a busy programme of work between now and October 31.
Over the next month we will hold a series of workshops and webinars that will gather industry experts to explain the steps you should be taking to prepare your company for a no-deal outcome.
We will also publish more guidance on the Hub, such as guest contributions from sector experts and updated content from our Business Planning for Brexit guide.
Finally, stay tuned for the imminent launch of our website’s unique Brexit chatbot service that will be available to answer your questions about planning for EU exit.
Businesses have been clear that a no-deal scenario is not the outcome they want but it is one that must be recognised as looming and requires action to prepare for. Company directors must consider the risks and mitigations of any challenge that comes their way – and the IoD is here to help you do just that.
Authored by Claudia Catelin, EU and Trade Analyst at the IoD