Small business urges clarity on UK’s future with EU

Prime Minister Boris Johnson has declared trade talks with the EU as "over", noting that there was "no point" in resuming discussions this week unless the EU agreed to discuss the detailed legal text of a partnership.

However, responding to comments made by the PM, Federation of Small Businesses (FSB) national chairman Mike Cherry has called for more certainty. 

“Not only have small firms been hit by the most severe recession on record over the past six months, they’re now 10 weeks out from the end of the transition period with no clear sense of what our future relationship with the EU will look like," said Mr Cherry. 

“They’re being told to both prepare and simultaneously manage a fresh set of COVID restrictions. Many simply don’t have the time or money to make adjustments, even if they want and need to.

“And they don’t even know what they’re preparing for – the government is essentially saying get ready for a no-deal outcome even though a deal could still happen." 

Mr Cherry explained that over four years on from the referendum, clarity is needed now more than ever.

"A pro-business, ambitious trade agreement remains the best outcome. The more changes can be phased in over time the better, particularly in the current climate.

“The last time we were told to prepare for a no-deal scenario you saw a big uptick in stockpiling. There simply isn’t the cash or staff capacity to make that possible this time round, with a lot of employees still furloughed amid weak demand," Mr Cherry explained. 

He said that while it has been encouraging to hear the government confirm that the latest deal draft reflects calls for a dedicated small business chapter, clarity is still lacking around what that chapter actually looks like.  

“A lot of small businesses have shelled out thousands to make their premises safe at a time when they had little or no revenue coming in only to be told to close. If the government wants firms to step-up preparations for a new relationship with the EU it needs to make doing so financially viable," Mr Cherry warned. 

"At the moment, thousands of small businesses are running on near empty."

The UK and the EU have encountered several stumbling blocks in their negotiations, including fisheries and state help for businesses.