BREAD & BUTTER BREXIT

From the boss of Middle Britain favourites Waitrose and John Lewis, a cool-headed call for a sensible...

FROM the food we eat to the clothes we wear, shops and shopping touch the lives of everyone in the country every day. And with 2.9 million people employed in retail, it is also the largest private sector employer in the UK.

There are few other industries likely to be so directly affected by Brexit – so it is urgent that, with just nine months left before we leave the EU, retailers are allowed to discover the true shape of the environment that awaits us.

While accepting that it’s always darkest before dawn, I’m still straining to see the first signs of light. It is troubling. Will there be tariff-free trade with the Single Market or will we go it alone? Is it to be a chaotic, cliff-edge Brexit or a seamless transition allowing business as normal?

As chairman of the John Lewis Partnership, which owns John Lewis and Waitrose, I am acutely aware of the urgent need for clarity on exactly how we should leave.

Common sense and pragmatism must prevail. History will look harshly on politicians who pay greater attention to theoretical notions of sovereignty than the bread-andbutter issues which will affect us all for decades to come.

Most of us are neither ardent Eurosceptics nor passionate Europhiles. All we ask is for a sensible Brexit, to give us the best chance of getting on and improving our livelihoods. What, then, is sensible? We can start by saying what is not sensible, and that is taking us out of the EU without a deal. Why? Because we’re not remotely prepared for that.

The consequences of walking out would be chaotic and damaging. I hope no responsible politician would contemplate leaving the country dangling in such a precarious position.

In contrast, it is vital that we agree a set of customs arrangements to ensure that our trade with the EU really does continue to be frictionless.

THERE is much more riding on this than most people realise. Modern supply chains are lean and fragile – a shop such as Waitrose typically carries only about three days of perishable stock, and a typical factory has parts for maybe half a day’s production.

Soft fruit, for example, can currently be transported from Spain straight to UK shops without border checks and still have five days of shelf life. Yet if animal and plant health checks on imports from countries outside the EU were to be applied, that shelf life would almost halve. Minutes magnify. Controls cost.

And the longer that takes, the less competitive we will become. We would pay for that in prices, jobs and wages.

Everything from medicines to machine parts travels across borders. The sheer quantity of goods that flow between the EU and the UK every day means that even what might seem like a small delay will soon multiply across the economy.

Despite what some might claim, ‘going it alone’ is not the best way to project our influence across the world.

The UK proudly plays a leading role in many of the key global organisations, from the UN and Nato to the World Health Organisation, and will continue to do so. Most people understand that creating alliances and developing co-operation gets things done.

Take plastics in the ocean. Acting alone might make us feel better, but the real difference will come from co-ordinated global action.

Yes, we have decided to leave the EU’s political structures, but we should still seek a close economic, diplomatic and legal relationship with our European neighbours. Those who like to suggest otherwise – the defiant ‘go-it-aloners’ – place great emphasis on us entering into new trade deals.

Indeed, such deals have taken on a romanticised status as a symbol of British strength since the Brexit vote in June 2016. In reality, they may represent anything but strength.

On the contrary, they will probably take a very long time to negotiate, will come at a cost, and the gains are likely to be modest.

Yes, we might gain greater access to other countries’ markets, for example in financial and professional services. Yet they will almost certainly want greater access to ours, most probably in areas such as steel, health and agriculture. There will be winners and losers. There always are.

The truth is that we don’t need new trade deals to trade with the rest of the world. Consider this: we already export more to the US than to any other country and Germany exports five times more than we do to China, in both cases from within the EU and without a trade deal.

In other words, if we wish to increase our exports to America or China, we are free to do so with or without Brexit.

When it comes to new, independent trade deals, it is unlikely they could compensate for the damage caused to our existing supply chains.

Frankly, it’s worth accepting limitations on our ability to strike trade deals around the world in order to secure a good deal with the EU, our biggest and closest market – and through which we also benefit from free trade with existing major partners (who already enjoy preferential agreements with the EU).

Trade through the EU and its partners makes up nearly 70 per cent of imports and that, in turn, makes a difference to everyday prices. Take clothing, bath or bed linen from Turkey, where the existing EUTurkey customs unions waive tariffs that would otherwise be in excess of ten per cent. In short, compromises will have to be made in order to move forwards with our negotiations.

But these compromises are worth it in order to get the Brexit deal with the EU that Britain needs.

SOME won’t like them and might think they undermine the very point of Brexit. Yet compromise gives us the best foundation to get on with a prize that’s even bigger than Brexit – getting match fit to compete in the world through productivity improvements which are even more important than Brexit.

Even modest productivity gains would boost our economy by £100 billion. That’s more than two-thirds of the £144 billion we spend on the NHS each year, and two-and-a-half times the amount we will pay to the EU as a divorce settlement.

It would lead to better living standards and greater prosperity across the UK.

A sensible Brexit means first and foremost striking a deal with the EU.

Far from being a sign of weakness, compromise is a sign of courage and leadership. At this pivotal moment in Britain’s history we need light, not heat.

And to achieve that we need our political leaders to have the courage to compromise.

A no-deal scenario will be chaotic and damaging