UK business ill-prepared for Brexit after coronavirus pandemic

Head of business group urges the UK government to strike a deal with the European Union

Business leaders have urged Britain's Prime Minister Boris Johnson to strike a deal with the European Union. Reuters

British businesses have run out of cash reserves built up to cope with a no-deal Brexit because of the coronavirus pandemic, the outgoing head of the UK’s main business lobby group has said.

The head of the Confederation of British Industry (CBI), Carolyn Fairbairn, told the BBC that the resilience of British business was “absolutely on the floor” and needed the UK government to strike a trading deal with the European Union beyond 2020.

The UK has left the EU and negotiations on a future trading and political relationship are stalling, with the latest round of talks ending last week with little progress made over critical issues including fishing rights and regulation.

Ms Fairbairn said that the pandemic had diverted the attention of senior business leaders from planning for the possibility of a major change in the relationship with the UK’s biggest trading partner.

“Every penny of cash that had been stored up, all the stockpiles prepared, have been run down,” she told the broadcaster.

“The firms that I speak to have not a spare moment to plan for a no-trade-deal Brexit at the end of the year – that is the commonsense voice that needs to find its way into these negotiations."

In a letter to Prime Minister Boris Johnson, Ms Fairbairn said that unemployment was the biggest threat to livelihoods.

She urged major investment in the green economy to create new jobs including a scrappage scheme to give motorists incentives to dump diesel cars in return for new electric vehicles.

“Long-term unemployment will leave generational scars. And business investment will need to bounce back fast to create the jobs of the future,” she wrote.