Ken McHattie CA, ICAS President: After Brexit, what next?
Ken McHattie CA, ICAS President, says that business must now rise to the challenge in the wake of Britain’s decision to leave the EU.
“May we live in interesting times”, is something no Prime Minister ever said, and certainly not David Cameron. But, after all the discussion and debate the UK has voted to leave the EU.
It is hard to overstate the significance of the decision.
Where the UK and the EU go from here is already the subject of much speculation and that will continue for some time to come.
What is perfectly clear is that the disconnect between politicians and many voters is much wider than most people had imagined.
There are very few issues which unite the political establishment in the way that membership of the EU has done.
With some notable exceptions, the leadership and rank and file of the main political parties in the UK, UKIP excepted, had campaigned for a Remain vote.
In addition, some key world leaders (notably President Obama), influential UK and global bodies (notably the Bank of England and the IMF) had warned of the, largely but not exclusively economic, dire consequences of leaving the EU.
In spite of that, voters turned out in very large numbers to deliver a knockout blow to their elected representatives and unelected “experts”.
ICAS will continue to work with Government and regulators over the coming weeks and months to provide the information and clarity that businesses require.
Attention will now turn to the mechanics of extracting the UK from EU structures and the negotiations on how the UK manages its trading relationships when it exits the EU.
The dangers for the UK are both political and economic. The current Government has been badly damaged by the outcome of the vote and must reestablish its authority.
Economically, the UK Government must come up with a credible set of proposals to convince businesses that the UK will not become an isolated basket case, which no longer has either influence or, more importantly, trade links. For the vast majority of businesses in the UK, membership of the EU is irrelevant to what they do.
That’s helpful, however, there are many businesses with European or worldwide trading links who badly need clarity on our plans for trade within the EU and further afield. It is vital that the UK government uses the next few months to convince those businesses that the UK will continue to be a safe and attractive place in and from which to do business.
And, both politically and economically, the Government needs to talk about immigration. It needs to reassure those migrants from the EU who are already in the UK that they are welcome and that their rights will continue to be respected.
And it needs to reassure businesses that leaving the EU will allow the UK to develop its own immigration policies which will be sympathetic to the needs of business in today’s globalised and ultra-competitive world.
Rightly or wrongly, concerns over immigration played a key role in the referendum debate and politicians from all parties would be well advised to consider how they have managed to be so out of step with so many voters. However, the Leave vote should not be taken as a cue to implement populist policies which, if nothing else, will damage the ability of businesses to recruit the talent they need.
So, as I like to tell my friends and colleagues, we are where we are.
It is vital that we embrace the realities of the position in which we find ourselves.
While many businesses would have preferred the UK to remain in the EU we now enter a new period of uncertainty without knowing when the key issues will be resolved.
You can be assured that ICAS will continue to work with Government and regulators over the coming weeks and months to provide the information and clarity that businesses require.
It will inevitably be a very difficult and challenging period for many businesses but the voters have made their decision and it’s essential that business now rises to the challenge and positively embraces whatever lies ahead.