UK Transport and Brexit News & Views No. 42

Brexit is certainly back in business with a vengeance this week with talks resuming on Thursday here in Brussels, and the CBI revealing the results of a survey that show that more than 60 percent of firms may trigger Brexit contingency plans by March 2018 because of the lack of progress. Are we finally beginning to see business wading more forcefully into the UK government’s Brexit approach? As we report below, CBI chief Paul Drechsler will warn today at the CBI conference that ‘The clock is ticking,” and argue that the greatest challenge for business is not Brexit itself but ‘the approach to Brexit’. In particular, he will call for ‘a single, clear strategy. A plan for what we want, and what kind of relationship we seek with the EU.’ It is quite extraordinary that after hitting the 500 day anniversary of the Brexit referendum that we are still no clearer on what kind of future relationship we want with the EU.

UK businesses are becoming increasingly desperate for some certainty and stability, and this is particularly the case in the transport sector where a ‘no deal’ or a lack of a comprehensive transitional arrangement would mean severe disruption for many involved in the international movement of goods and people. Since so much of transport revolves around international connectivity, we know all too well that much of the UK domestic market will be impacted too, not least in terms of the ability to retain and recruit the EU labour force that helps keep Britain moving.

We are now just over five weeks away from the December meeting of the European Council, a meeting that is of incredible importance to transport when you consider the potential ramifications of a new declaration of ‘no sufficient progress’. What this means is that we all have just over five weeks to persuade the UK Government and the EU27 that now is precisely the time to put business first, by reaching a compromise on the so-called divorce issues, agree to a comprehensive transitional arrangement, and begin talks on all aspects of trade, including transport. We believe that the sooner an agreement can be made on a transitional arrangement, the better the environment will be to negotiate and agree on a positive framework for future UK-EU relations.

Finally, we are three weeks away from UKTiE’s Annual Forum, please do register to learn more about planned EU transport regulations, and receive an all-important Brexit update from key decision-makers. 

1. Three weeks until UKTiE’s 7th Annual Forum
UKTiE’s Annual Forum will take place on November 28th in the European Parliament. The theme for the Forum is “Clean, connected and competitive – how to modernise Europe’s transport system”. The three sessions will discuss 1) Decarbonising road, rail, maritime and air transport, 2) Digitalisation of road, rail, maritime and air transport, and 3) Reforms to keep road, rail, maritime and air transport competitive. Brexit or no Brexit, planned EU regulations are still likely to apply to you in some form. Spaces are limited – register here.

2. Outgoing chief executive of London City Airport, Declan Collier, says business interests getting in the way of Brexit aviation progress whilst Willie Walsh expresses confidence in positive Brexit outcome for aviation
Outgoing chief executive of London City Airport, Declan Collier believes that progress on aviation within the Brexit process faces disruption from vested European interests. He said that “said that despite the overall focus on the benefits of retaining a positive relationship between the UK and Europe, “there are commercial interests that will be looking to see what they can do to improve their position.” In contrast, speaking to the House of Commons Transport Committee during a one-off evidence session regarding the impact of Brexit on the aviation sector, Willie Walsh (CEO, International Aviation Group) dismissed the possibility of grounded flights between the UK and the EU. He further said that “life will go on” and that the EU had more to lose than the UK should Brussels refuse to agree a new aviation deal with the UK post-Brexit.

3. Businesses consider triggering contingency plans by March 2018 as they begin to criticize May’s Brexit approach
According to a new study conducted by the Confederation of British Industry, 60% of firms in the UK will have triggered their contingency plans by March 2018 if there is no transitional arrangement in place. It further found that 87 percent of businesses have discussed Brexit at board level. A third of firms have created an internal task force or steering group to monitor and report on Brexit. This news comes as the Confederation of British Industry President Paul Drechsler will appeal, today, at the CBI annual conference for a “single, clear strategy” while also calling for an end to “episodic approach” taken by Theresa May in the negotiations.

4. Sixty-three percent of non-British European companies expect to move some of their supply chain out of Britain
In a survey conducted by the Chartered Institute of Procurement and Supply (CIPS), it was found that Sixty-three percent of non-British European companies expect to move some of their supply chain out of Britain, up from 44 percent in May. Although the UK and the EU appear ready to speed up negotiations, CIPS’ group chief executive officer Gerry Walsh said “British businesses simply cannot put their suppliers and customers on hold while the negotiators get their act together”. This has come in an environment where, according to CIPS, a fifth of British businesses were struggling to secure contracts that extend beyond March 2019.

5. UKTiE Supported by IDA Group
UKTiE’s work is supported by IDA Group. IDA Group is a highly specialized consultancy for governmental affairs, reputation management, trade and funding. They share the belief in effective dialogue built upon trust and mutual understanding. Their diverse team of experts includes seasoned diplomats, politicians, journalists, lawyers and designers, supported by a global network of trusted partners, can help create measurable impact for your business. You will find more information on IDA Group and what services they can provide you with here.

6. Parliament votes for the release of the government’s Brexit sectoral impact studies
On Wednesday, the UK Parliament voted for the release of the government’s 58 sectoral studies on the impact of Brexit. Following the vote, Speaker John Bercow said “Motions of this kind have in the past been seen as effective or binding.” During the debate on the matter, Brexit Minister Robin Walker said that approaches such as redactions or summaries of the studies could be used.

7. The view from Paris: French firms are preparing for a ‘catastrophic’ breakdown in Brexit talks
Pierre Gattaz, head of MEDEF (France’s largest businesses lobbying group representing 750,000 firms), has said that French firms are preparing for a possible ‘catastrophic’ breakdown in Brexit talks and a disorderly British exit from the European Union. Gattaz further said that MEDEF is fully focused on facing the next big Brexit challenge, beating rivals such as Germany to win jobs and investment leaving Britain. He said that Brexit creates opportunities and a “competition” that must be approached with a sporting mentality of “may the best win”.

8. Flexible and imaginative solutions needed to solve the Irish Brexit problem
David Phinnemore, Professor of European Politics at Queen’s Belfast University, writes that while there is a good deal of lip service being paid to promoting ‘Flexible and imaginative’ solutions to the Irish Brexit problem, there now needs to be ideas to back up this rhetorical commitment. Phinnemore explores radical ideas such as retaining EU membership for Northern Ireland, but also looks at the possibility for Northern Ireland to retain EEA membership or even creating a ‘Special Economic Zone’ covering Northern Ireland and the border counties of Ireland and would allow for ‘access’ to the Customs Union and the Single Market. Admittedly, he says that neither of these options would be necessarily good for Northern Ireland as they don’t include agriculture, but that there are further imaginative and flexible solutions there as well.

9. UKTiE has also put together the latest timetable for Brexit. We will keep this up to date as the process develops: 

  • 29 March 2017 – A50 triggered
  • 5 April 2017 – European Parliament adopted Brexit guidelines
  • 22 May 2017 – Brexit negotiating directives approved by Council
  • 19 June 2017 –  Negotiations formally began
  • 9-10 November 2017 – 6th Round of Brexit Negotiations Begin
  • 28 November 2017 – UKTiE Annual Forum
  • 14-15 December 2017 – European Council to review progress of negotiations
  • TBC 2018 – UKTiE  & Norton Rose Fulbright Summit: Customs arrangements after Brexit.
  • 30 September 2018 – Date by which EU’s chief Brexit negotiator, Michel Barnier, wants to conclude the terms of Britain’s exit from the Union.
  • 30 March 2019 – Britain formally exits the EU, following ratification of Brexit by all other member states and the European Parliament.
  • June 2019 – European Parliament election.
Mark Watts
Co-ordinator
UK transport in Europe (UKTiE)
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