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Are UK businesses prepared for Brexit?

Neil Morling, Interim CFO at Slater and Gordon Group discusses our latest Big Question – are UK businesses prepared for Brexit?

Well, since setting this latest Big Question we have yet again seen proof, if indeed it was needed, that a week is certainly a long time in politics. Reed Accountancy & Finance recently asked finance and accountancy professionals whether they felt better informed as the route to Brexit was allegedly becoming more settled. And two key ministerial resignations have, at the time of writing, thrown up yet another twist in a tale which may yet prove worthy of a Netflix series.

A big theme that has been ever present is the accusation and counter accusation around misinformation presented before the vote, and how the outcome may well have been different if we knew then what we know now. From the latest survey of REED clients, only 13% feel better informed today than they did when they voted, a sad indictment on how it's felt the Brexit process has progressed over the past two years.

Unsurprisingly this has impacted business thinking, with 29% of respondents admitting to not being prepared at all for Brexit, 26% feeling slightly prepared and 32% somewhat prepared. In total a staggering 87% falling short of being “Brexit ready”. Is this a surprise? Well yes, as we are only 6 months away; but also no, as we still do not know what Brexit will actually look like.

Diversity in hopes and fears within UK business is clear. One REED client – an accountant from the public sector – foresees “the business climate in future years looking rather bleak and several industries looking likely to suffer from both business closures and moves to EU countries, with a marked decrease in business rates”. Yet Tim Whelan (Financial Director, Travel Industry) senses “an opportunity for companies to position themselves well to work in Europe and an even broader market than before”.

To add to the sense of wonderment, the clearest signal that UK business is at odds with the 52% who voted for Brexit comes from the 31% of REED clients who see a Free Trade agreement as the top priority from “the deal”. 19% cite continued membership of the Single Market as key. Both of these are theoretically out of bounds to the purist Brexiteer. 

This came through clearly with I. Churchill (Head of Finance, Retail Industry) forseeing: “more talent will be leaving the UK; we have a very European work force with staff from Portugal, Netherlands, Germany and Lithuania. As a multi-cultural team, language skills are important to us as a global business so roles might be harder to fill in future”.

More talent will be leaving the UK; we have a very European work force with staff from Portugal, Netherlands, Germany and Lithuania.
I. Churchill - Head of Finance, Retail Industry

In summary – short of adding that the only thing missing from this perfect political/economic storm is Donald Trump, who at the time of writing is suggested we sue our way out of  Europe – I do sympathise with Theresa May, who has the impossible task of delivering something a majority of the electorate voted for, and yet a majority of politicians and business leaders who are engaged in its delivery remain against. To her credit she is now holding firm to what she believes is the best Brexit for Britain and is committed to delivering what the majority voted for – some may say a refreshing change.

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