An extension to the Brexit deadline will not leave businesses “dancing in the streets” as many remain unprepared for a no-deal outcome, the director general of the Confederation of British Industry (CBI) has warned.
Carolyn Fairbairn said no-deal planning and stockpiling was leaving some of her members feeling like they were “burning money every day”.
Her comments come after EU leaders offered Prime Minister Theresa May a further six months to ratify or rethink her withdrawal deal.
Speaking at the Institute for Government in London yesterday, Ms Fairbairn said the new delay would provide “brief relief” for businesses worried about the “cliff edge” of a no deal.
She said: “It will be quickly followed by frustration, exasperation, we’re still here.
“Six months will come around extremely quickly and I think members will already be thinking ‘but that’s the run-up to Christmas’.”
Ms Fairbairn added: “I’m afraid there will be no dancing in the streets around this and I wouldn’t expect much in the way of ramming down of no-deal planning.”
The British economy had shrunk by 1-2 per cent as a result of the Brexit uncertainty, she said.
“We must have political compromise now to get this deal done so we don’t find ourselves in the same situation in six months’ time,” Ms Fairbairn added.
Just 4 per cent of the CBI’s members say they are “completely ready” for a no-deal Brexit, and up to 50 per cent of small businesses having done “absolutely nothing at all”, Ms Fairbairn warned.
Regulated sectors such as finance and insurance were more ready, with other sectors braced for disruption.
Ms Fairbairn called on the Government to use the new Brexit delay to find a political compromise. “Our huge hope off the back of this six-month reprieve is that it’s used to set up a process and it’s not just people locked in a room on their own,” she argued.
Ms Fairbairn said there should be a three to four-month process of bringing together civic society and wider stakeholders to discuss Brexit.