With Britain’s divorce from the European Union under a year away the uncertainty of Brexit is a significant concern for UK citizens at home and living overseas.
Living in Dublin, my rights to work and access to social security should be secured post-Brexit under the historic Common Travel Area (CTA) agreement. This agreement is due to be maintained between Britain and Ireland. CTA enables UK and Irish citizens to travel freely between the two states and grants freedom to work, access healthcare and social welfare.
In the rest of Europe, it is far less certain what rights British citizens will have particularly in the longer term. Once the UK leaves the EU, British citizens will become “third country nationals” with no automatic right of admission. The fear is that this could leave people landlocked – requiring passes to travel – and unprotected by EU laws, voting rights and social benefits to which they had grown accustomed.
At this time, it is unclear what Brexit will mean for British expatriates. It all depends on the outcome of negotiations being undertaken but it seems unlikely that travelling and living abroad will remain as easy as it is currently.
Similar uncertainty exists for Britain’s businesses, concerned that the recruitment of internationally-mobile, high quality staff and ease of trade will be made more difficult by Brexit.
This is very notable in financial services, an industry in which the UK, and particularly London, excels. The deputy Governor of the Bank of England, Sam Woods, has forecast that Brexit may lead to up to 75,000 finance job losses. Banks including Citigroup, Morgan Stanley, Deutsche Bank, and JPMorgan Chase have said they will move staff and operations out of Britain to service their EU clients. Frankfurt, Paris, Amsterdam and Dublin appear to be the preferred relocation options.
It is unsurprising, with this backdrop, that the UK government has made securing the future of finance and big business a priority in its Brexit plans. Many commentators now think that the impact to financial services will not be as bad as initially feared.
The future appears less certain for SMEs. SMEs make up 60% of all private sector employment and 51% of all private sector turnover in the UK. However, as a more diverse and less influential community than large multinationals, their views and concerns are not as readily heard.
A study by University of St Andrews looked at the potential impact of Brexit on SMEs and concluded that there is “deep-seated uncertainty permeating UK small businesses. Brexit … has the potential to fundamentally re-write the rulebook for how firms do business in the UK.”
Speculation over what may come from Brexit is rife but advice from the British Chamber of Commerce is that planning for Brexit is not just a case of “wait and see”. Practical measures should be put in place. Firms will need to consider whether their working capital is sufficient, whether trade products, such as guarantees, are required from their banks, and whether arrangements with freight forwarders and logistics providers are adequate.
The people side of the business also needs to be evaluated. Consideration should be given to the level of dependency that firms put on foreign staff who face uncertain futures. Additionally, companies should consider their hiring policies and how they will be affected. This is of particular concern for labour-intensive industries like agriculture.
It is vital that SMEs plan for Brexit by strategically preparing for all scenarios that may arise. They can be assisted by frequently meeting with advisors and staying on top of latest news events.
From an Irish-UK perspective, it is important that the UK’s relationship with Ireland – its closest and largest trading partner – continues to prosper. There are key challenges and it is important to resolve the Northern Ireland border issues. However, with a common language, shared history, and a similar business and cultural environment, these challenges should be surmountable. This will require goodwill and communication on all sides. The UK will need support within the EU going forward and who better than Ireland to act as a bridge between the EU and the UK.