European Affairs — House of Commons, 2018-03-15
Topic: Foreign Trade
Ruth Margaret Cadbury (Labour, Centre-left): It is a pleasure to follow so many eloquent—and some long—contributions I wonder how many arch-Brexiteers have actually spoken to people who work in or run businesses to learn about the impacts of not only Brexit but uncertainty about Brexit, and how it is affecting decisions in their constituencies at this moment. I have done that, and I am going to share just two examples with the House. One is a specific small company, and the other is in a major sector. I would have covered more, but have had to cut and cut my speech as the second half of the afternoon has progressed The owner of a small and medium-sized enterprise, a research company, wished to remain anonymous, but wanted me to know his position. He wrote to me: "I run a small business and have already lost out because of Brexit (due to the drop in sterling putting up the cost of our cloud computing by 20% and uncertainty over future research funding). There are lots of detailed questions for my business that I have no idea how to answer, and I don’t have armies of lawyers and accountants to work out for me. So much for the Tories cutting red tape. Such as, if there is a hard Brexit, will there be an uninterrupted service from all the cloud computing currently supplied via companies based in Ireland? Will I be able to access all my data and information on day one—or need new customs clearance or change my data protection set up? Will cloud computing be treated as an import with tariffs—and therefore add to my operating costs and accounting costs as I grapple with new HMRC rules? These are things that could tip my very small, struggling, business over the edge. I’m sure we’re not the only vulnerable SME." He goes on: "More generally, MPs say they will protect jobs. In my sector income"— rather than jobs— "is already moving judging by conversations I am having with partners and in my networks. Contingency plans are already being enacted by SMEs. I know of companies who have set up offices in mainland EU and are starting to channel work through there, even if it is UK-based staff doing it, for now. I am being paid in Euro for some work that previously would have been in sterling, which exposes me to risks I can’t offset. This is all completely legal. Two of my most talented EU colleagues have left the UK because they ‘don’t feel welcome’—they both lived here as children but having become parents themselves believe the situation is too uncertain to keep their roots here…In my view, the loss to Britain will be this invisible drip-drip of lost talent and money rather than announcements of big job losses by big employers and will only become apparent when it is too late." Secondly, my constituency is home to a large number of broadcast organisations—household names such as Sky, and myriad others, many whose main market is not even in the UK—and many of my constituents work in broadcasting, including a few household names. The UK dominates Europe’s broadcasting sector due to the availability of skilled employees and English being the dominant language in the industry. Thanks to the country of origin principle, hundreds of international media organisations are based here and can broadcast to anywhere in the EU without restriction. The trade organisation COBA—the Commercial Broadcasters Association—fears: "International broadcasters based here would, reluctantly, be forced to restructure their European operations", particularly with a hard Brexit. It said a month ago that Brexit could cost the TV market £1 billion per year in investment, put at risk thousands of jobs in the UK broadcasting sector, and undermine the sector’s long-term global competitiveness. It says: "Like many sectors, broadcasters cannot wait until the cliff edge of March 2019 to make decisions about the future of their European businesses." So even if no deal is not the Government’s intention now, these companies are having to make a risk assessment, divert management resources into contingency planning and make a decision on whether the risk of no deal is too great—they will jump ship anyway, taking jobs and investment with them. This means additional cost on otherwise unnecessary contingency planning and diversion of management time and energy, or just cutting and running These are the real impacts of Brexit now. If we multiply this by tens of sectors and hundreds of thousands of businesses making millions of decisions about their future, we see that this is what is leading to the UK tumbling down the international growth tables. It undermines Government income that funds our vital public services and, as looks increasingly likely, makes our constituents poorer. The Government must wake up, and focus not on the outliers in their own party, but on the economic prospects of the UK and its place in the world.