Business development · 24 February 2016

London calling: The capital’s small firms could have the final say on Brexit

The FSB found that over 55 per cent of London-based members wanted to stay in the EU
The FSB found that over 55 per cent of London-based members did not want a Brexit

The Brexit debate reached a climax in parliament this week as David Cameron set 23 June as the date for a referendum. With Britain’s European future looking set to create serious waves in Westminster over the coming months, businesses have a greater opportunity than ever to make their views heard, with small firms particularly pivotal.

With the conclusion of the prime minister’s EU renegotiation talks in Brussels, the stage is now set for the Brexit debate to step up a gear. Britain’s position in Europe has always been one of the most compelling and important issues facing the country’s decision makers, both in politics and business, and the outcome of the referendum on 23 June will no doubt be one of the defining moments in this parliament.

Deep chasms are already emerging within the Conservatives on the issue, with Boris Johnson this week becoming the latest Tory heavyweight to throw himself behind the so-called ‘Leave’ campaign, sucker punching his old Etonian buddy David Cameron in the process. He joins five senior cabinet ministers that have now come out in favour of Brexit, including justice secretary Michael Gove and leader of the House of Commons Chris Grayling, proving that when it comes to Europe, personal passions beat party loyalty every time.

While a dividing topic for politicians, the business community seems evermore certain of itself on the issue, begging the argument that Britain’s European future rests in the hands of business first and foremost.

The prime minister received his most resounding sign of support yet from business this week, as 198 UK business bosses signed a letter to Cameron, published in The Times, calling on Brits to vote to stay in the EU on 23 June.

Including signatures from 36 FTSE 100 CEOs, the letter’s key paragraph read: “Business needs unrestricted access to the European market in order to grow, invest and create jobs. We believe that leaving the EU would deter investment, threaten jobs and put the economy at risk. Britain will be stronger, safer, and better off remaining a member of the EU.”

Indeed, nowhere in the country have businesses expressed eagerness to remain part of the EU as much as in London, where access to the single market is seen as one of the city’s greatest attributes – one that will continue to define the capital as an internationally oriented trailblazing hub to rival the likes of New York or Hong Kong.

Responding to the Confederation of British Industry’s (CBI) latest London business survey, the overwhelming majority of the capitals business figureheads outlined their position in favour of continued EU membership. From professional services to the burgeoning tech sector, London’s industries want to remain free to attract promising new companies and skilled individuals whilst maintaining full access to Europe’s 500m consumers.

“There is a strong desire amongst the capital’s firms to remain in a reformed EU,” said CBI London director Lucy Haynes. “From the strength of the capital’s financial services sector to the ability to adapt to an ever-changing digital landscape, it’s clear that London is an international city, and keeping it ahead of global competitors is a top priority for the city’s businesses.”

London’s small firms are likely to play a pivotal role in the debate. A recent FSB survey found that its members in the capital were more pro-European than those from other areas, with over 55 per cent of London-based companies supporting a vote to stay in the EU, as opposed to 47 per cent nationally.

Over the next four months in the run up to the referendum, small business owners should think carefully about what they want out of Europe. As your venture grows, will you look to export to European markets? Or employ skilled European workers, for example? Asking these questions will help you determine what the benefits of the EU are to your future prospects. At Business Advice, we aim to keep you informed and involved with the debate.

Is George Osborne’s Northern Powerhouse initiative failing to engage small business?

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ABOUT THE EXPERT

Fred Heritage is deputy editor at Business Advice. He has a BA in politics and international relations from the University of Kent and an MA in international conflict from Kings College London. He previously worked as a reporter at Global Trade Review magazine.

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