With 58 days to go: is Kent business prepared for Brexit?
Article posted: 30th January 2019
As Parliament sent Theresa May back to Brussels and expressed a desire to avoid ‘no deal’ last night, a group of Kent SMEs came together to discuss Brexit and whether business was prepared for a possible cliff edge shock, if it comes, on the 29th March.
With 58 days to go, reaction from business is one of rising concern. With this in mind, McBrides Chartered Accountants' Brexit Panel Discussion last night (Tuesday 29th January) examined what is in store for SMEs from an economic and business perspective.
Alex Golledge, the Bank of England’s south east and East Anglia deputy agent was present to represent the economic view, he was joined by Sonali Parekh, Head of Policy for the Federation of Small Business (FSB) and Alex Stojanovic from the Institute for Government.
The panel displayed an impressive knowledge of the 600-page Withdrawal Agreement and the implications of its success or failure for business. The panel discussed the possibility of a ‘no deal’ and how this scenario would impact the economy and business in the south-east.
It became clear from the discussions that businesses from varying sectors would be affected differently, with the service industry and agriculture most at risk from a ‘no deal’.
Sonali Parekh explained the view of the FSB’s SME members taken from recent surveys. She pointed out that the FSB had been careful to remain balanced in exploring the opportunities and risks of Brexit.
Among the FSB’s recent survey details:
- Of the fifth of smaller businesses which export, 92% of those smaller businesses export to the EU with 21% of them exporting exclusively to the EU.
- 85% of current smaller businesses importers, import from the EU.
- One in five smaller business employers, employ at least one member of EU staff.
- Around half (48%) of those impacted by a ‘no deal’scenario on 29th March, stated they needed to know by the end of January 2019, if that is the outcome they will be facing, in order to prepare.
- Another 34% of impacted smaller businesses stated they would not be in a position to prepare at all, likely because of limited resources. Many smaller businesses are now very worried about the current uncertainty and that is weighing on small business confidence.
Sonali Parekh said: “Small businesses are resilient, but confidence has dropped sharply in recent months and it’s taking its toll. We are very clearly against a no deal on the 29th March. We want to see financial support, whether in the form of vouchers or soft loans, made available to smaller businesses to help them to prepare. The HMRC grants to support smaller businesses trading or looking to trade with the EU to build up their capacity to deal with customs declarations are a step in the right direction, but far more support needs to be made available.”
Alex Stojanovic from the Institute for Government offered a stark warning to the assembled audience at the London Golf Club, he said: “At this stage, we don’t have an alternative to ‘no deal’. Generally, for a lot of people this hasn’t been on their radar. There are many regulations that people haven’t understood the full ramifications of and it’s fair to ask do MPs fully understand the deal? Whatever relationship we have with the EU, Brexit is not going to go away.”
Thanking the panel and assembled guests at the end of the event, panel chair Nigel Kimber, a partner at McBrides Chartered Accountants, said: “Tonight has been very revealing, it’s fair to say that business is concerned, if not worried, and the finer points of the agreement need explanation and further interpretation.
“There is help out there for SMEs in the form of guidance and information from organisations, such as the FSB. And it’s important to look to the think tanks and listen to people who have had the time, energy and knowledge to pour over the finer details.
“Many businesses, although worried about Brexit, haven’t made plans for a ‘no deal’ scenario because it’s something they don’t either have the infrastructure or investment to put time aside to deal with. We hope that our event, and events like these, go some way to helping businesses understand the need to plan for the unknown.
“It was particularly pertinent to go home and learn that Parliament had steadfastly said they do not want a no deal - in a lot of ways it’s out of our hands, but what remains under our control is the desire to plan and to ask others for help and advice.”
Over 50 individuals attended the event.
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