Politicians on both sides of the Channel have been strongly urged to find a Brexit solution and prevent a no-deal outcome representatives of business and finance say would be calamitous for the UK, eight days before the deadline.
It comes as Theresa May arrives in Brussels to make a direct plea to EU leaders to postpone Brexit for three months, hours after telling the British public a delay was “a matter of great personal regret”.
At an EU summit in Brussels, the prime minister will try to persuade the other 27 countries to delay the UK’s exit beyond 29 March. Yesterday she wrote to Donald Tusk, president of the European Council, to request a short extension to Article 50.
Carolyn Fairbairn, director-general of the Confederation of British Industry (CBI), said: “What we need now is a plan for how we get to the deal in an extension. The Conservatives must drop their red lines and the Labour opposition must approach the question in a constructive manner.
“Clearly we never wanted to be here with just eight days to Brexit, but given where we do find ourselves it has become an absolute necessity. It’s bad enough for large companies, which have prepared contingency plans. They are at least ready with plans to implement post Brexit — lost jobs and factory closures.
“But a bigger worry is the 80 per cent that are smaller and simply don’t have the resources to plan up front. The shock they will face is severe. Businesses are clear about the sort of extension that we need. One that gives long enough to find a deal but one that is no longer than necessary,” she said.
Edwin Morgan, interim director general of the Institute of Directors (IoD), said: “Business leaders are completely disillusioned with the Brexit process and faith in politicians dwindles with every passing day. Our members had a legitimate expectation that by now we would have moved on to establishing our future trading arrangements with the EU, but instead we are nearly three years down the line with little to show for it.
“No deal would be painful and cause its own uncertainty, while an extension without a clear purpose could keep us in limbo. Business leaders are by nature resourceful and resilient, but these conditions are testing them to the limit.”
National chairman of the Federation of Small Businesses (FSB) Mike Cherry said: “Most small businesses don’t have a problem with postponing Brexit through a short, technical extension of Article 50.
“With only eight days to go before we are supposed to leave the EU, it seems inevitable and the only path remaining if we are to avoid a chaotic and disastrous no deal next week. Any extension, however, must have a purpose.
“There is absolutely nothing to be gained if all we get is more dithering, debating and political games. We are already seeing the negative impact Brexit uncertainty is having on small firms – we know of some that that are having stock pulled from other stores as a direct result of it. This must be avoided at all costs.
“Politicians from across the spectrum must use whatever extra time they are given, to stand up and show the leadership, responsibility and pragmatism that has so far been lacking. This is the only way that we will be able to find a credible route out of this mess,” he said.
A spokesperson for the Trades Union Congress (TUC) said: “Thanks to the government’s disastrous mishandling of Brexit, extending Article 50 is now the only sensible option. But the prime minister must now accept that her deal has failed, and use the period of the extension to find a real alternative, that protects jobs, rights and peace in Northern Ireland.”
City raises fears
Catherine McGuinness, policy chair at the City of London Corporation, said a no-deal Brexit she said would be a catastrophic own goal for consumers, households and businesses both in the UK and European Union, needed to be avoided. “Sustained uncertainty is leaving business with its hands tied, reluctant to make everyday decisions on recruitment, expansion, and investment,” said McGuinness.
“We urge the EU to agree to an extension. But even if this is granted, it should not simply paper over the cracks as we risk facing another cliff-edge just around the corner.
“More than ever, politicians on both sides of the Channel need to be pragmatic and co-operate in order to find a long-term solution to the current impasse. We cannot continue driving down this road to nowhere,” she added.
Stephen Jones, chief executive of financial services lobby group UK Finance, said: “Time is running out to avoid a chaotic ‘no deal’ Brexit that would do significant damage to the UK economy.
“It remains essential that MPs on all sides of the House work together to find a workable solution and provide much-needed certainty to businesses and the customers they serve.
Every day of uncertainty means more damage to investment, jobs and business confidence,” he said.