Analysis

PM’s dithering will cause death by thousand cuts to economy

by Hugo Dixon | 31.05.2018
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Finally business is finding its voice and warning the prime minister that her delay and dither over Brexit is damaging the economy. And not a moment too soon.

After seeing Theresa May yesterday, a group of Europe’s 50 largest companies issued a statement saying: “We need clarity and certainty, because time is running out. Uncertainty causes less investment.” They added that a trade deal with the EU must be “frictionless as with a customs union”.

Bosses from companies including BP, BMW, Nestle, and Vodafone attended the meeting. The group, known as the European Round Table, has combined revenues of £2 trillion and millions of employees.

Brexit uncertainty is already hammering foreign investment, as Vicky Pryce, former joint head of the government’s economic service, wrote last week.

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Now a survey by the Bank of England shows business leaders at our most productive companies hold the most negative views on Brexit. Such anti-Brexit businesses are investing less and employing fewer people as a result. A professor who designed the survey told the FT that this could explain the UK’s recent dismal productivity performance.

Meanwhile, one of our most respected automotive bosses warned at the weekend of Carmageddon if we “barrel headlong towards a hard Brexit”. The head of Unipart wrote in the Mail on Sunday: “If the car industry fails, the economy will go with it. No one voted in the referendum to lose their jobs or their income.”

Low investment means low productivity. That leads to low-paid jobs. It also means that people and companies will pay less tax which, in turn, means less money to support the NHS, schools, housing and neglected communities. That’s exactly the opposite of what people voted for two years ago.

The Conservatives like to think of themselves as the party of business. But the prime minister’s endless can-kicking risks driving businesses away. Two years after Brexit, we still don’t know what Brexit means. Instead, May has negotiated a “transition” deal to act as a stopgap – and is now proposing a Customs and Regulatory Alignment Period (CRAP) as another stopgap after that.

It’s time the government listened to business and put an end to the uncertainty. It must come up with a viable long-term plan before next month’s European Council summit – and nail down a detailed deal by the following summit in October. Otherwise, it will inflict death by a thousand cuts on our economy.

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Tags: big business, ERT, foreign investment, Categories: Economy

3 Responses to “PM’s dithering will cause death by thousand cuts to economy”

  • In my view, the PM is not just being vague, she is deliberately obfuscating. She has no intention of coming to any agreed brexit negotiation with anybody.
    She is flannelling, deliberately procrastinating, she has only one goal in mind!
    She is determined to meet the requirements of her extremely wealthy supporters, among them are Aaron Banks, Murdoch, Harmsworth and the Barclays, together with others.
    They are only interested in evading the new EU company Anti Tax Avoidance legislation, which is operative across the EU from January 2019, and must be adopted into British legislation, in 2019/20, unless we leave the EU, promptly in 2019.
    They are also determined to avoid the proposed EU, company Anti Tax Evasion Directive, planned to follow.
    We are being sold down the river by deliberate lack of action on the part of our government, which is comprised of many despicable charlatans, with no moral compass.
    May is driving for a last minute rock hard brexit, whatever the cost!
    History will defame her, she will be stigmatized, whatever happens.
    The PM may fail, if enough of her back benchers become more revolting than many of them already are.
    But then she would claim to her supporters, that she tried to force a rock hard Brexit, but the commons stopped it.
    That is our only hope now, is for the politicians to call a halt, rescinding the Art 50 notice, with abject apologies to our fellow 27 member countries.
    If we end up with an unconditional hard brexit, the UK will be very badly, possibly irretrievably, damaged, socially, scientifically, environmentally and financially.
    Corbyn should be opposing May at every turn, but he believes that his dreams, of taking essential services back into public ownership, cannot happen within the EU, he is demonstrably wrong!
    He should be fighting to keep us in the EU, but if he continues to be unclear and continues obfuscating, he will forever look in on the sidelines.

  • Absolutely. Whichever way you look at Brexit, there’s nothing good about it. Forget all the stupid slogans and petty soundbites, the fact is that 47 years of EU membership have given us great prosperity, which is now slowly dribbling away, thanks first of all to the fool Cameron and now the spineless May. The only possible good thing that might come out of a hard Brexit and the car crash that follows is the absolute destruction of the Conservative party. Because when the public realise who is to blame for a) their impending unemployment, b) the rising prices in the shops (particularly fresh veg), c) their income reducing in real terms and d) the end of Britain’s respected place in the world (not that that puts meat on the table) they will punish the tories at the next election – big time. Only the diehard right wingers, who hope to make lots of dosh out of it (Mogg is already a millionaire) will remain faithful.

    “May you live in interesting times” – indeed.

  • It is time this PM and her cabinet was voted out. She has dithered far to long the BREXIT vote was 2 years ago and nothing has been done. I voted remain to stop the country going bust. Apart from that a lot of people who voted are dead, leaving BREXIT so long, a lot of people who now know a bit more about what will happen may have changed their minds.
    I want another BREXIT vote rather than see thousands of people out of work.