EU grants Brexit 'flextension' until January 2020: Reactions

Business leaders across the country have reacted to the news that the European Union has granted the UK government a flexible extension of Brexit until January 31 2020.

President of the EU Council Donald Tusk announced the decision to extend the deadline on Twitter this morning, offering a ‘flextension’ which would enable the UK to leave before the January deadline in the event of a deal being approved by Parliament.

The news comes less than a week away from the previous deadline of October 31, with the formalisation of the extension through a written procedure among the 27 other EU nations expected later this week.

Luke Davis, CEO and Founder of IW Capital

“Small businesses in the UK are undoubtedly hoping for increased certainty over the Brexit deal and leaving date. Once the deal is confirmed the sentiment to push on with business will really be able to take off.

“As entrepreneurs and investors look to capitalise on new opportunities that are bound to exist after Brexit. Over the last year or so, we have seen a concerted effort to get on with business, regardless of Brexit and the eventual outcome.

“One thing that we need to ensure is that entrepreneurs and investors looking to start or support a small business are not put off by the turmoil in Parliament.”

Jenny Tooth OBE, CEO of the UK Business Angels Association

“As negotiations continue to drag on and eat into the transition period, which was put in place to help business prepare for the imminent loss of EU support, we are at risk of running out of time to plan and make changes.

“Funding for SMEs in the regions has been somewhat forgotten about recently. This will subsequently impact regional SMEs more than larger businesses that can take the hit, or areas such as London or the Golden Triangle which receive the majority of domestic investment.

“The potential loss of investment from the continent including the European Regional Development Fund, Horizon 2020 and the Jeremie fund could create a huge investment gap in UK.

“This is concerning not only for the loss of EU money, but the risk that Government support for finance to replace this EU funding may take time to have an impact on the ground.”

Claire Reading, FSB Development Manager for South Yorkshire, East Yorkshire & the Humber

“There will be a collective sigh of relief from small businesses that a no-deal Brexit in three days’ time has been avoided. However, they will find themselves trapped by more uncertainty as Westminster fails to move beyond Brexit.

“For many small firms, extensions are doubled-edged swords – yes they safeguard against the damage of a no-deal Brexit but they also prolong uncertainty without actually removing the potential of a no-deal further down the road.

“A proper transition period remains small firms’ top ask, ideally for two years. We have already seen the length of the original proposed transition period reduced significantly – we will likely have less than 12 months left if the extension lasts until the end of January. “Small businesses need to have enough time to prepare for whatever changes are to come.

“These firms have been starved of certainty, battering down the hatches for a potential no-deal that would have harmed nearly 40 per cent of our members. All this has done is cause them to stop making business decisions. They have stopped hiring staff, they’ve stopped investing and they’ve stopped growing.

“MPs continue to be very good at not making decisions about Brexit but there comes a time when decisions need to be made. We are way past this point – we cannot get stuck in a cycle of never-ending extensions. MPs from all parties must come together and use this extra time in a meaningful way to break the deadlock as quickly as possible.

“Small businesses need this.”

Paul Holcroft, associate director at Croner

“Many employers will no doubt have been struggling to keep up with Brexit as it has unfolded over the last few months, but it seems that we now finally have a little bit more certainty.

“Under the provisions of the Benn Act, the Prime Minister will have to accept this extension offer from the EU as he works to get his Brexit deal through Parliament.

“Fundamentally, this delay has all but confirmed that a Halloween no-deal scenario is off the table, something that will likely cause a significant number of employers to breathe a sigh of relief.”

“As the UK once again enters into negotiations with the EU, a no-deal situation could still be very much a possibility going forward. Furthermore, the January 31 date is not set in stone and Brexit can be brought forward if a deal is agreed before then.

“Whether this will be the deal previously presented to Parliament, or an entirely new agreement, remains to be seen. What is essential is that employers keep up to date with ongoing Brexit developments as we go forward.”

More to follow.

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