Business development · 1 March 2016

Firms call on government to plug information deficit as Brexit debate gears up

Uncertainty over Britain's European future remains a key issue for small business
Uncertainty over Brexit continues to dominate the small business agenda

It is “game on” for campaigners on both sides of the Brexit debate appealing for the small business vote ahead of the 23 June EU membership referendum, as firms outline the areas that are most likely to influence the direction of voting.

The results of a new FSB survey conducted amongst the federation’s members revealed that 42 per cent of the UK’s small business vote could still be swayed, as company owners remain undecided and uninformed on issues such as EU governance, the implications of free movement of labour and the long-term costs of EU membership.

The administrative burden on business as a result of EU regulation compliance, trade with other EU members and continued access to the European single market were also ranked highly amongst the factors likely to determine the direction of voting.

FSB policy director Mike Cherry said that the results suggested small businesses are ready to demand answers from both “Remain” and “Leave” campaigns as both gather momentum.

“Now the date is confirmed for the referendum, it is crucial that both campaign groups tackle the information deficit. Smaller businesses want to know the practical impact that remaining within or leaving the EU would have on their firms,” said Cherry.

The small business community has so far expressed mixed reviews about the possible implications of a Brexit, but the majority of those with a vested interest have tended to agree that greater access to information is necessary as 23 June approaches. Above all, firms fear that voter ignorance and confusion could lead to ill-informed voting – the effects of which may not become apparent for some time.

Yu Energy managing director Bobby Kalar said: “I’ve heard passionate cases for both scenarios and feel there’s an atmosphere for change, but the ramifications of making the wrong decision in June may not be felt for years.”

Small business data and insight provider Ormsby Street managing director Martin Campbell suggested that jeopardising Britain’s EU membership should not be a decision the country takes lightly, and indicated that heavy electioneering by the Conservatives in 2015 may have got in the way of sensible policy decisions when it now comes to Europe.

“Already, the ‘leave’ campaign is misrepresenting the role EU membership has in contributing to the success of small business in the UK,” added Campbell. “The movement of labour is enormously positive and there are many entrepreneurs that rely on the availability of a workforce with diverse skills from across the EU to grow their business successfully in the UK. Europe is a natural market for many UK businesses, as well as a source of talent.”

The top ten areas the FSB found to be influencing how members will vote in the referendum were as follows:

• EU governance (how decisions are made, for instance) – 75 per cent
• Free movement of people (including labour, travel and tourism) – 70 per cent
• The cost of EU membership – 69 per cent
• The administrative burden on business as a result of EU regulation compliance – 68 per cent
• The impact on the UK economy – 64 per cent
• Trade with other EU countries – 53 per cent
• Access to the European single market – 49 per cent
• Trade with non-EU countries – 48 per cent
• Access to EU funding – 42 per cent
• Competition – 35 per cent

The results back up more strongly than ever the view that uncertainty over Britain’s European future remains one of the biggest challenges small business owners face. In December last year, a CitySprint poll showed the issue to be a major source of worry for 27 per cent of the country’s small firms, whilst 60 per cent admitted a Brexit would deter long-term growth plans.

Read on to find out how the Brexit debate has been influencing exporting firms.

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ABOUT THE EXPERT

Fred Heritage was previously 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.

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