Nearly nine in 10 business leaders flag importance to UK of EU trade deal
ONLY one-quarter of UK business leaders say their organisations are prepared fully for the end of the Brexit transition period, and nearly nine in 10 say that a trade deal with the European Union is important for the economy as it recovers.
These are the findings of a poll of 978 company directors conducted in late June.
Of business leaders surveyed by the Institute of Directors, nearly half said they were not able to prepare right now, with one in seven distracted by the coronavirus pandemic and nearly one-third declaring they needed details of any changes to be clear before adjusting.
The UK Government has ruled out an extension of the transition period – during which the UK remains a member of the European single market – beyond December 31. The July 1 deadline to agree an extension of the transition period, which has been in effect since Brexit was implemented on January 31, has now passed. outlets have been shuttered since March, and its online business was temporarily shut down at the end of March, but resumed trading in April.
In June, the group put its Kast Retail subsidiary into administration in a bid to offload loss-making outlets and reduce its rent payments. Kast was responsible for the 82 stand-alone Quiz store leases.
The group immediately bought back stock and other assets of Kast for £1.3 million, with the contracts of 822 employees transferred over. However, 11 stores were permanently closed by the administrators with the loss of 93 jobs.
Quiz is currently in discussions with landlords about the leases on the 71 remaining shops, which were not transferred over as part of the pre-pack administration. Three have re-opened so far, with lease negotiations continuing across the remainder.
“We continue to believe that stores, with appropriate property costs and flexible lease terms, can continue to be a relevant pillar in our omni-channel model and we will be seeking to re-open Quiz stores where we believe it is prudent and economic to do so,” Mr Ramzan said in June.
About 69% of those polled said that reaching a trade deal was important for their organisation. And 89% said such a deal was important for the overall economy as it recovers. Even among the portion of directors who favoured being able to diverge from EU rules, 71% said that reaching a deal was important to the economy.
The IOD highlighted its view that time to adjust once changes were clear would be vital to business recovery, whether there was a deal or not.
It called on the UK and EU to “commit to a reciprocal, phased implementation wherever possible, and for the UK Government to provide greater clarity on its contingency plans in the event of a no deal”.
The survey found companies in the financial sector were most likely to be ready for the end of the transition period, while manufacturers in particular had more to do. Directors of services companies felt especially unable to prepare at present, the IOD noted, whether as a result of pressures of the pandemic or because they needed more clarity on changes.
Jonathan Geldart, director-general of the IOD, said: “With so much going on, many directors feel that preparing for Brexit proper is like trying to hit a moving target. Jumping immediately into whatever comes next would be a nightmare for many businesses...
“At a time when government is rightly straining every sinew to help firms deal with widespread disruption, it would be counterproductive not to seek to minimise it at the end of the year.”
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