Theresa May should make clear in the Brexit plan she has promised to publish that she intends to take the UK out of the European single market and customs union, a leading business supporter of EU withdrawal has told MPs.
Former British Chambers of Commerce boss John Longworth, who co-chairs the Leave Means Leave group, said this would allow businesses time to plan and let Government concentrate on doing the spade-work for new free trade deals to sign and draw up a shortlist of regulations to abolish on “Brexit day one”.
But the director general of the Confederation of British Industry, Carolyn Fairbairn, told MPs on the Commons Exiting the EU Committee that retaining barrier-free access to the single market was one of the key requirements of business, which regards it as a bigger priority than limiting freedom of movement.
And TUC secretary general Frances O’Grady warned that a bonfire of regulations would expose British workers to a “race to the bottom” on employment conditions and risk making the UK the “bargain basement capital of Europe”.
Mr Longworth told the committee that he would prefer Mrs May not to publish her Brexit plans, arguing that “as a businessman going into a negotiation, I would be very keen to keep my cards close to my chest”.
But he added: “I do think the Government should declare its direction of travel. I think it’s important the Government should announce it is minded to leave the single market and customs union.”
If Mrs May fails to do this, he said, “we are in danger of wasting a lot of time in negotiations over the next 18 months when we should be directing Whitehall to spend time having conversations on free trade deals and drawing up a shortlist of regulations that can be removed on Brexit day one”.
He added: “Then businesses will have 18 months to plan for that and there will not be a need for any transitional arrangements after the event.”
Mr Longworth said the UK could “easily” remove 10% of EU regulations without harming workers’ rights – citing examples like labelling rules requiring smoked salmon packets to be marked “may contain fish” and protections for newts which are rare on the continent but common in Britain.
But Ms Fairbairn cautioned MPs against focusing on “silly” anecdotal stories about over-regulation, which she said were of less concern to her members than the threat of losing access to European markets.
Many companies welcomed regulations which provided a “level playing field” on issues like labelling and which prevented “dangerous cowboys” from overseas operating trucks in the UK, she said.
Although the CBI welcomed Mrs May’s Great Repeal Bill – which will translate EU regulations into UK law as a prelude to abolishing those deemed unnecessary – it was vital that MPs take into account “the benefits of standardisation and level playing fields within the EU, which have been of great benefit to our businesses”, she warned.
And Ms O’Grady told the committee: “I would hope that all of us will want to avoid a race to the bottom and I am not reassured by the process of a Great Repeal Bill, as I don’t think there will be time and opportunity to scrutinise issues like employment rights that are so important to so many people.”
She added: “Whichever way people voted in the referendum, you will be hard pushed to find any working person who voted for worse rights. They don’t want to fall behind French, German and Italian workers and end up as cut-price labour.”
Ms Fairbairn said businesses would need “a period of adjustment” of nine to 12 months following Brexit – whether the UK has struck a new trade deal with the EU or not – in order to avoid the shock of a “cliff edge” move to new arrangements.
“We are calling for a period of adjustment for businesses to be able to make the investment, to be able to prepare and to be able to plan, so we don’t have that sudden change in trading conditions that would be so bad for jobs, so bad for investment in this country,” she said.
“A cliff edge is not something anyone wants, but a speedy exit with an adjustment period is what our members are looking for.”
7th December, 2016: Belfast Telegraph