UK business angered by lack of input on post-Brexit links with EU

Stasis in Brexit talks and splits in May’s cabinet spread frustration
Lack of consultation signals sinking relations with government
Business groups continue to seek more involvement in process

Leading UK business groups have expressed fury at the government over what they see as ministers’ failure to consult companies over Britain’s post-Brexit relationship with the EU.

Corporate leaders are particularly concerned that their views have not been sought before the government’s planned white paper on the detailed relationship between the UK and the EU once Britain leaves the bloc.

“There has been zero formal consultation with business on the content [of the white paper],” said one leading business group representative.

Business groups’ complaints highlight their growing frustration both with the stasis of the Brexit negotiations between the UK and the EU and the divisions at the top of Theresa May’s government.

Relations between business and the government have been on a rollercoaster since Mrs May became prime minister in 2016, with corporate leaders saying that improvements after last year’s general election have now been replaced by fresh tensions, notably over the Brexit white paper.

It emerged on Monday that Mrs May has delayed publication of the flagship policy document until after a key EU summit on Brexit this month.

Hobbled by lack of detail

“We’re playing economics, [the politicians] are playing politics,” said Paul Drechsler, president of the CBI, the employers’ organisation. “Is it any wonder that in the world of business we’re frustrated, we’re angry.”

“We’re not . . . seeing detailed asks from the government in terms of the [Brexit] white paper,” said Catherine McGuinness, chair of the policy and resources committee at the City of London Corporation, the local authority that oversees the capital’s financial district.

Anyone who isn’t preparing contingency plans is off their rocker

One business group representative said he suspected the reason his organisation had not been consulted on the Brexit white paper was because the Department for Exiting the EU was worried about leaks and “doesn’t want us to see the gigantic gaps where the government doesn’t have a settled position”.

“Right now businesses’ greatest frustration is with the UK government for its inability to put forward clear positions — because that means they can’t plan for the future,” said Adam Marshall, director-general of the British Chambers of Commerce.

Guy Platten, chief executive of the UK Chamber of Shipping, a trade association, said the government could not expect the business community or the public to “get behind its vision when its vision is barely comprehensible”.

Business organisations said large companies were now implementing contingency plans based on the UK failing to reach a Brexit deal with the EU but warned that smaller groups often lacked the resources to do so.

“Anyone who isn’t preparing contingency plans is off their rocker,” said Mr Drechsler.

Corporate bosses are meanwhile taking the lack of consultation on the white paper as confirmation of deteriorating relations with the government.

Mood turns towards despair

After she became prime minister in July 2016, Mrs May was accused of freezing out business groups, in stark contrast to her predecessor, David Cameron.

But her decision to oust key advisers Nick Timothy and Fiona Hill after the election in June 2017 marked the start of improving relations with corporate leaders.

They tell us we are being listened to but they fail to take our ideas on board

Increased dialogue delivered what was for business a big win — Downing Street’s acknowledgment that a transition period was imperative after the UK leaves the EU in March 2019.

But the corporate leaders’ sense in mid-2017 that the government was finally listening to business priorities, and acknowledging their importance to the UK economy, has been replaced by frustration and disappointment.

“It’s all politics,” said one chief executive, who regularly attends meetings at Downing Street and the Treasury. “They tell us we are being listened to but they fail to take our ideas on board.”

While some corporate bosses said relations with the government were in general good — one FTSE 100 chairman described it as “never being better” — on Brexit the mood is turning towards despair.

Cabinet splits drain trust

“This is a government that has lost the trust of the business community,” said Peter Bingle, a lobbyist who runs Terrapin Communications. “They are very wary and suspicious.”

Iain Anderson, head of Cicero Consulting, whose clients include big banks, said people had been reassured by Mrs May’s keynote Brexit speech in the spring.

“Since Easter it has been much more difficult; it’s been more difficult because of the differences of opinion she is trying to manage around the cabinet table,” he said.

The five leading business groups — the CBI, the BCC, the Institute of Directors, the Federation of Small Businesses and the EEF, the manufacturers’ body — regularly meet Mrs May, Philip Hammond, the chancellor, Greg Clark, business secretary, Liam Fox, trade secretary, and David Davis, Brexit secretary.