IoD: Transition deal by March or firms will leave

Simon English
The UK is due to leave the EU in March 2019: PA

A top business lobby group on Tuesday set out a stark warning to the government on Brexit, saying it has just months to strike a deal and avert chaos.

The Institute of Directors says Theresa May and her cabinet must “pull out all the stops” to break the deadlock, or else the body will start advising members to relocate business from the UK.

In a speech at the IoD annual dinner tonight held at the Royal Lancaster London Hotel director general Stephen Martin will tell members: “We have not yet achieved ‘sufficient progress’ in talks with Brussels to move on to discussing our long-term relationship with the EU.”

He will add: “It’s clear that the Government has a small window of opportunity between now and the end of the first quarter of next year to secure a firm political agreement on transition.

“If we don’t have this commitment by the end of March, then business will come under pressure to implement contingency plans, even perhaps as far as relocating operations. Clearly, we don’t want this to happen.

“The message from business is that all we want for Christmas is progress on Brexit.”

That message comes as the government ponders a £40 billion payment to the EU as a divorce settlement. That led to an immediate backlash from hard Tory MP Brexiteers.

Martin, whose members employ more than a million people in the UK alone, says the IoD supports the idea of a transitional period of March 2019 so companies can adjust to new arrangements.

“We need to know this implementation phase will in effect keep the terms of cross-border trade unchanged, so that business can get back to making crucial investment decisions that are facing a chill at the moment,” said Martin.

The IoD will be watching closely for signs in tomorrow’s budget that the government has been listening to its members.

“We know from our recent surveys that over half of you are already in the process of contingency planning. The number of businesses who have actually implemented these plans is currently low, around one in 10, but this will snowball if we don’t find out soon what is going to happen in March 2019,” said Martin.

Martin says IoD members are concerned, but not pessimistic.

“These are uncertain times, but the one thing I know for certain is that government will have to rely heavily on business to deliver its plans if we are going to make Britain the titan of world trade that we hope we can be.”

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