Brexit progress would be the perfect present
BREXIT really does continue to be the key issue in our country at the moment. This, of course, featured in our response to last week’s Budget when we welcomed the Chancellor putting hard cash behind the Government’s preparations for leaving the EU.
Business wants to know how the Cabinet is getting ready for our departure, as it will involve changes across so many areas of government, including customs, regulators and our immigration system.
We continue to stress the need for constant communication from ministers about their objectives for future trade arrangements between the UK and EU as the negotiations proceed.
The Budget really brought into focus the need to develop relationships across the world, which is what we endeavoured to encourage during a recent event we hosted with a number of diplomats here at our recently-opened Cardiff hub.
These were leaders about to take up positions as UK ambassadors and high commissioners across the globe from countries ranging from Peru to Dubai, Algeria to Namibia and Kazakhstan to New Zealand – although we didn’t talk rugby that day.
It certainly brought to my attention the need to build relationships with countries around the world and this is a common theme from us at the IoD at the moment. The visit offered the chance to impress upon them the need, when they are in position, to recognise the opportunities that Wales can offer and engage with us in future.
The visit touched on issues that I am continually raising on behalf of our members as I put their case for Wales to the Secretary of State for Wales and Welsh Cabinet Secretary for Economy and Transport on their Brexit advisory groups.
I’ve heard strong opinions about Brexit from all directions, and while there is concern, there is also determination to get through this process and see what lies on the other side.
I don’t downplay the challenges, but while I meet with plenty of confusion and some frustration, I don’t find defeatism among the IoD’s ranks.
In my experience, business simply gets on with it. Now we need the politicians to deliver for us. It seems to be that there is an obstacle lying between future trade opportunities and where we currently stand.
We have not yet achieved “sufficient progress” in talks with Brussels to move on to discussing our long-term relationship with the EU. From talking to IoD members, I know many are concerned about what happens if a breakthrough isn’t made at the next round of talks in December.
To me it’s as simple as this – we are now only 16 months away from leaving the EU. We need the discussion to move on to our future trading relationship and, critically, what happens when the Article 50 timeline runs out in early 2019.
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.
We know from recent surveys that over half of IoD members are already in the process of contingency planning. The number of businesses that have actually implemented those plans is currently low, around one in 10, but this will snowball if we don’t find out soon what’s going to happen in March 2019.
Companies need to plan ahead, or they leave themseleves vulnerable. In Wales this has the potential to affect the significant-sized companies and, importantly, their supply chains and the communities in which they are based and where people rely upon their continued presence.
While Brexit dominates, other activities still go ahead. And there were some welcome outcomes for Wales in the Budget announcement – the further confirmation that the Severn tolls will be scrapped is noted.
Transport upgrades for west Wales to facilitate direct services from Pembroke Dock to London via Carmarthen with new Intercity Express trains were also welcome and potential proposals for other Wales-wide rail networks were uplifting. Freezing Air Passenger Duty (APD) tax is encouraging, but in Wales, the devolving of APD for Cardiff Airport would have been hugely beneficial and put us on a par with Scotland and Northern Ireland, where APD has already been devolved.
The news relating to the north Wales growth deal as well as the opening up of the debate for a mid Wales growth deal is both welcome and positive.
It is a certainty that there will be a Budget next year, as there is every year. But in 2018, Brexit will be ever more imminent and pronouncements from the despatch box in November 2018 are unlikely to make a huge difference, so this was the Chancellor’s chance to give business the boost and confidence it desperately needed. Our members are crying out for clarity and focus and, to quote our Director General, “all we want for Christmas is progress”.
Robert Lloyd Griffiths is director of IoD Wales.