FSB sets out small business agenda for EU negotiations

Published:  30 June, 2016

The Federation of Small Businesses (FSB) is urging the government to ensure economic stability at this time of uncertainty, and has outlined key asks to government in the EU negotiations.

Mike Cherry, national chairman at the FSB, said: “FSB will be the voice of smaller businesses in the EU negotiations, starting with Business Secretary Sajid Javid's business summit, which was held on Tuesday 28 June. As soon as the EU Referendum results were clear, FSB called on the government and the Bank of England to provide economic stability, for small firms to get the confidence to continue to drive economic growth and create jobs.

“In this business summit, I will continue to push for immediate action to reassure small businesses so they can continue to trade and do business. Smaller firms need simple access to the single market, the ability to hire the right people, continued EU funding for key schemes and clarity on the future regulatory framework. This is crucial to ensure economic growth and job creation.”

One third of FSB members export or import, with the vast majority doing so with other countries within the single market. Access to the single market means access to 500m potential consumers and more than 26m businesses. It is worth more than £9tn. The UK decision to leave the EU will impact smaller firms, which directly import, export, but are also part of a supply chain. FSB is calling on the government for assurances that smaller firms can maintain access to the single market, and for steps to protect inward investment.

Smaller firms employ 15.6m people, which make up 60% of all private sector employment in the UK. Access to the right skills is a crucial requirement of smaller firms to ensure they can meet consumer demands and grow as a business. Over 30% of FSB members are worried they do not have access to the right skills. Smaller firms need to be able to hire the right person for the job, and sometimes this means recruiting from overseas.

Mr Cherry continued: “While we must focus hard to upskill our UK workforce, including both academic and vocational skills, access to skilled labour from the EU must remain in place in the medium-term. In addition, many UK small firms, the self-employed, consultants and freelancers want the right to work in the EU as they do now.

”Directly and indirectly, many small businesses have benefitted from EU funds, some channelled toward infrastructure and others toward local initiatives. FSB members want reassurance that all schemes remain fully-funded in the short-term and a full assessment of the future of EU-funded schemes takes place.

”The government's de-regulation drive has seen some success, but we now call for a stronger role for the Regulatory Policy Committee in terms of tax regulations and rules coming from the EU. Government should now be setting out its approach to boost this drive to remove red tape. UK/EU law has been developed over the last 40 years and now needs to be disentangled, and government must provide clarity over what new regulation may be required.”

Furthermore, FSB members in Wales, Northern Ireland, Scotland, and London are seeking assurances that their administrations are fully involved in all significant talks. It is vital that these talks relate to the industries of special importance in all nations of the UK. In addition, FSB members in Northern Ireland seek assurances that it will not see the reinstatement of Border controls between Northern Ireland and the Republic, nor when travelling to the rest of the UK. FSB members in Wales are also seeking assurances to safeguard structural funds for the most economically deprived areas. FSB is also speaking to its sister organisation in Gibraltar on their specific concerns.

Mr Cherry concluded: “FSB will continue to be a constructive partner in these negotiations and push for swift clarity on these crucial questions. We will seek to ensure that the confidence of the UK’s 5.4m small businesses, which is already at its lowest level since 2013, does not fall any further. Next week, FSB will discuss this issue with members from across the UK at our regional policy conference.”

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