Brexit: planning for the unexpected
In a time of great political upheaval, on a scale rarely ever seen in the UK, we are continuing to come to terms with the change that is upon us. The level of uncertainty as to what these changes will be has created nervous markets and a constantly evolving political landscape.
Whilst the economy is returning to some resemblance of normality, business confidence is likely to suffer in a climate of uncertainty. Political and economic advisors are hesitant to suggest what may or may not happen in the long term. The UK Government is beginning to realign Whitehall to investigate the options for the post-Brexit world and preparing for the activation of Article 50. We remain part of the EU, but in a current vacuum, without a route plan to determine where we are headed and what our relationship with the EU will ultimately look like. With that in mind, now is the time to take note of the major political risks and how they could affect your business.
Scotland’s voice has certainly been heard and it’s abundantly clear that as a nation, we see the value in EU membership. Nevertheless, the decision to leave must be respected – the time for emotional reactions has passed. As the First Minister paves a path towards engaging bilaterally with the EU through the newly formed Standing Council on Europe, the possibility of a second Independence Referendum is back on the table.
A divided Britain would create further uncertainty and so it’s not surprising that the UK Government has promised to involve Holyrood in the continuing Brexit discussion. With the Government and official opposition in turmoil, and both the Conservatives and Labour seeking new leaders in the space of a week, retaining stability will be a priority. Although there is no timetable for a second Indy Ref yet, Sturgeon will be keen to capitalise on the pro-EU sentiment and motivated electorate. While there are no guarantees that Scotland – independent or as part of the Union – would be able to remain within the EU or apply from outside the UK, maintaining a positive relationship with the EU will undoubtedly be central to the SNP’s strategy. With legislation to initiate another referendum expected to be drafted imminently and the main opposition parties already signalling their opposition, voters have yet another politically charged agenda to look forward to.
So what does this all mean for business? The UK has been a member of the EU for 43 years, so it’s uncharted territory, but at Grayling we are starting to explore the implications for our clients.
We are examining the risks posed to the workforce with potential immigration and employment controls, and financial stability with the fluctuation of the value of sterling and risk of rising taxes. The risk to European funding for research and how organisations need to prepare to find alternative sources is also high on the agenda. The removal of European Structural Funds and the changing landscape of competition and consumer protection have also featured as key considerations. Seeking the advice of political advisors is vital and can help keep you ahead of the curve on this changing environment.
Get in touch with Ross, Director of Public Affairs at Grayling Scotland – Ross.Laird@grayling.com or on 0131 260 2511.