The Covid-19 crisis has diverted the nation’s attention from Brexit, but all the while the long countdown of the transition period has continued and suddenly, deal-or-no-deal, the UK leaves the EU in just three months time.
Most reports and surveys show extreme nervousness amongst business and industry leaders at the prospect of a no-deal Brexit, with a report from the London School of Economics saying Brexit and Coronavirus will combine to deliver a double whammy to the economy.
The report shows that the sectors involving more human contact, including hospitality, air travel, hotels and restaurants and the arts, have been hardest hit by the pandemic, whilst other sectors, such as the scientific industries, professional and legal services and publishing, have been less severely affected because they continue to operate with staff working from home.
But with the ending of chancellor Rishi Sunak’s pandemic policy aimed at supporting the unemployed, and the new trading environment outside the EU soon to be upon us, the report claims that a ‘simultaneous impact’ from Brexit and Covid-19 will take effect.
Goods, immigration and trade
Brexit will bring barriers on those trading goods or services with the EU, at a time, according to the report, when the coronavirus pandemic had reduced the capacity of the economy to take further shocks.
And as the situation toughens it isn’t just companies that are failing or quitting these shores; a British-German study has shown that Brexit has sparked an exodus of economically productive individuals from the UK to European Union nations.
Immigrants, who, using the government’s words, ‘suit the needs of our economy,’ could potentially replace those leaving, but the manufacturing body, Make UK, warns that more than half of the manufacturing sector is planning redundancies as business support schemes end.
The LSE report urges the government to put in place an industrial strategy that reflects the reality of ‘being in a post-Brexit UK which is placed in a post-Covid world economy.’ The government declined to extend the transition period to allow further time for talks on a trade deal, but with global trade shrinking, was that the right decision?
What our surveys show
A new government marketing campaign sees ‘Let’s Get Going’ introduced as the lead Brexit catchphrase.
If you look, you can find Government information videos, with their punchy phrases and catchy slogans; one boasts that our new relationship with the EU will be based on ‘friendly cooperation between sovereign equals.’
Sovereign equals? The UK, as the government pointed out in its Brexit White Paper, remained sovereign throughout its membership of the EU, whilst the EU isn’t and could never be, a sovereign nation.
Individuals and businesses need clear guidance at this crucial time, and these muddled and frequently meaningless, not to mention expensive, messages, can appear more like the government attempting to convince itself rather than the nation that the good times really are just around the corner once we pass GO on January 1st.
Brexit is happening, the nation accepts the decision, but almost half of us (49%) consider it was a mistake not to extend the transition period (compared to only 33% who believe it was the correct decision), reasoning that a little more ‘friendly cooperation’ at the appropriate time might well have made all the difference.