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With among the youngest and most international workforce of any of Britain’s industries, together
with products which are intrinsically cross-border in nature, the UK’s digital and creative industries
firms will be concerned about the potential impact of Brexit on their ability to trade and upscale
across Europe – and the effect it may have on the Government’s aim to turn the UK into a global
digital hub.
Prior to the EU referendum, technology firms were among the most fervent supporters of a vote to
remain. In March, Tech industry body techUK polled its members and found that 70% of
respondents were in favour of remaining in the EU; a similar survey by Tech London Advocates
showed that 87 per cent of tech professionals supported a remain vote, with just 3 per cent opting to
leave. Senior Executives in telecoms firms such as BT and Vodafone, meanwhile, publicly declared
their belief in the importance of remaining in the European Union to their respective businesses.
Creative industries figures were similarly effusive in their support, with a survey by members of the
Creative Industries Federation showing more than 96% support for Remain, with 4% in favour of
Leave. Major industry figures also signed a public letter calling for the UK to remain in the EU.
Questions about the impact of Brexit on the digital and creative industries surround three main
areas. Firstly, the future of the digital single market and the impact it may have upon the sector’s
ability to trade with the EU; secondly, how withdrawal will affect data protection regulations; and,
thirdly, the impact of free movement of people upon the digital sector’s uniquely international
workforce.
Implications for the Tech Sector – Digital Single Market, Data Protection, and Immigration
In May 2015, the EU published their three-tier plan for a Digital Single Market in the EU, aiming to
unify regulation and promote innovation across the UK’s 28 national markets. Ahead of the vote,
Prime Minister David Cameron argued for the benefits of the Digital Single Market, saying that “the
overall impact could be worth up to £330 billion a year to the EU economy,” and that “as one of
Europe’s leading providers and users of e-commerce, the UK would particularly benefit from a
Single Market in digital services.” Whilst Brexit would not necessarily present a permanent exclusion
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to the Digital Single Market – or the Single Market more broadly – for the UK’s tech firms, access is
no longer a given, with a lengthy and difficult renegotiation now on the cards.
Questions also remain regarding the applicability of the EU General Data Protection Regulations
now that Brexit is imminent. Designed to clarify and unify data protection rules across borders as
economies become more and more data-reliant – and the risks presented by cyber-security breaches
become ever more significant for businesses and consumers – the recently agreed rules presented
both threats and opportunities for the digital sector in the UK. After four years of battles over the
regulations, and the bureaucratic challenges they present, there are now serious questions over
whether British firms will have to follow these rules. The Information Commissioner’s Office point
out that, if the UK has any ambitions to access the Digital Single Market, it must prove “adequacy”
with the Regulations; however, this will require the passage of UK legislation to ensure compliance
on a domestic level. This presents its own challenges, and time and effort will have to be spent
ensuring the legislation is both fit for Britain’s purpose and complies with EU standards – given the
GDPR took four years to pass, it is to be hoped that similar issues will not be faced on a domestic
level. At the same time, however, this presents an opportunity for more UK-specific legislation,
better tailored to Britain’s own needs.
Thirdly, immigration has a serious impact upon the digital sector. Up to 21% of the UK’s tech
company founders are foreign citizens, and the industry’s workforce is notoriously international –
and internationalist in outlook. Tech firms are particularly reliant upon overseas talent, with the
UK’s Digital Skills shortage - estimated to cost the UK economy £63bn a year in lost GDP – forcing
companies to look overseas to fill a number of technical posts. The Migration Advisory Committee’s
recent restrictions to Tier 2 visas were expected to hit the digital sector particularly hard for this
exact reason, and any restrictions on free movement of European labour will likely cause concern
among businesses across the digital and creative industries. However, there are potential positives to
a Brexit: with the ability to renegotiate free movement rules, the number of low-skilled workers
coming to the UK from the EU could potentially be reduced, alleviating the pressure to clamp down
on higher-skilled workers from elsewhere and enabling the UK’s imported tech talent to be boosted,
rather than repressed, though this remains highly speculative.
Where Next?
Fundamentally, the message from across the digital sector is that it will continue to thrive, even in
the face of Brexit. As a uniquely adaptive, innovative and progressive industry, it is well placed to
overcome any obstacles placed in its path by the UK leaving the European Union. Nevertheless, in
such a fast paced arena, any missed opportunity could seriously hamper both day-to-day trading
and scale-up potential, something which will prey upon the mind of businesses across the sector as
the UK attempts to confront the realities of Brexit.
Tech
The Chartered Institute for IT, BCS, noted the uncertainty faced by the sector. David Evans,
Director of Policy & Community, promised to work with DCMS and BIS regarding data regulation,
among other issues, arguing that “the UK must be a leading nation for digital innovation, with
citizens at the heart of our approach, and very much open to international business” and that “to
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support this we need to ensure that the relationship we have with the EU is right around personal
data and access to markets”.
He also spoke about ensuring that “we support and grow our academic base in computing, foster
industrial collaboration, and send a message out to the international academic computing
community that we want to increase collaboration” as well as “recognising that IT is a global sector
and profession, and that we need to grow and attract the best talent into the UK digital domain”
The Information Commissioner’s Office have clarified the impact of Brexit on the UK’s Data
Protection landscape. Noting that “The Data Protection Act remains the law of the land irrespective
of the referendum result”, an ICO spokesperson said that whilst “upcoming EU reforms to data
protection law… would not directly apply to the UK” in the UK in case of Brexit, “if the UK wants to
trade with the Single Market on equal terms we would have to prove 'adequacy' - in other words UK
data protection standards would have to be equivalent to the EU's General Data Protection
Regulation framework starting in 2018” and concluded that “reform of the UK law remains
necessary.”
Stewart Room, head of PwC Legal's data privacy and protection practice, argued that “it is vitally
important that the controllers and processors of personal data do not fall into the trap of thinking
that the new EU General Data Protection Regulation (GDPR ) no longer matters to them” as
“Compliance with the standards of EU data protection law will be a "red line" requirement for the
UK's continuing access to the single market”. Mr Room warned that “it is almost inevitable that the
UK will pass legislation to give effect to the GDPR” and that “Failure to do so will not only lock out
the UK from the single market, but it will effectively prevent any form of business with the EU
where personal data is involved”
Creative Industries
Geoff Taylor, Chief Executive of Music Industry body the British Phonographic Industry, said
that the industry will be “be concerned by the economic uncertainty that lies ahead and the impact
this may have on business prospects”, and called on the Government to “swiftly negotiate trade
deals that will ensure unimpeded access to EU markets for our music and our touring artists” as well
legislating for “stronger domestic copyright rules that encourage investment here in the UK and
which will protect UK creators from piracy and from tech platforms siphoning off value through
copyright loopholes”
John Kampfner, Chief Executive of The Creative Industries Federation said that it would be “vital
for all sides to work together to ensure that the interests of our sector on issues including access to
funding and talent are safeguarded as the UK forges its new relationship with Europe” and
promised to hold a series of events to engage the creative community on charting a way ahead.
Telecoms
Sir Mike Rake, Chairman of BT, told Dominic O'Connell, Today business presenter, that the result
would mean “a potentially long period of uncertainty and volatility” which would be bad for
"investment and the creation of jobs”. Sir Mike called upon the UK’s political leaders to “deal with
this situation to try and create some stability and try and eliminate some of this instability as soon as
possible."
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The Communication Workers Union, the major telecoms union, supported a remain vote “on the
basis that Europe and this country needed serious reform” and said that “what’s crucial now is that
the whole labour movement unites in shaping the outcome of what taking back control of our
country should really mean”. This would include “a new deal for workers, radical solutions to the
housing crisis and an approach to the economy that is based on Government intervention to support
our industries and public services” as well as “a more open and honest debate about immigration”
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There has been a general consensus that Britain’s membership of the EU allowed UK higher
education institutions to set the research agenda and drive collaboration.
During the referendum campaign, university leaders were consistent in extolling what they argued
were the economic benefits that overseas students bring to local economies, with 102 university
heads issuing an open letter expressing concern about the impact of Brexit.
On behalf of students, the NUS has also expressed disappointment at the results the referendum,
particularly given the high proportion of young voters who are reported to have voted in favour of
staying in the EU. National President, Megan Dunn, has written to Downing Street and BIS ministers
to ask for a range of assurances over the future of further and higher education in light of the Brexit
vote.
Following the result, several academic groups voiced concern about maintaining the international
links between their institution and others.
Universities UK (UUK) has expressed its disappointment at the Brexit decision, but has added that
the process of withdrawal would be gradual and present opportunities to influence future policy.
UUK has stated that its focus would be on securing support to allow universities to keep their
connections with overseas institutions and remain attractive for students and academics from across
the world. It added that there would be challenges in convincing the Government that students and
academic staff from EU countries can continue to study at British Universities.
There could also be an impact on the fees that EU students at UK institutions pay. Depending on the
exact nature of Britain’s future relationship with the EU and the EEA, EU students could eventually
pay as much as other international students.
Further, Times Higher Education has reported that observers are predicting a potential “brain drain”
from EU institutions.
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Meanwhile, the Russell Group has said it will seek assurances that the funding universities received
from the EU would be replaced and sustained long term. Pro-Leave ministers have previously
provided assurances that the UK Government would continue to fund EU programmes until 2020,
but funding beyond this date remains unclear.
The Independent suggested that newer institutions were more dependent on EU funding, with
Southampton Solent University receiving more than 91 per cent of its competitive grant research
income from the EU. These institutions are thus most likely to be affected by the referendum result.
Higher Education and Research
Dame Julia Goodfellow, President of Universities UK said “Throughout the transition period our
focus will be on securing support that allows our universities to continue to be global in their
outlook, internationally networked and an attractive destination for talented people from across
Europe… Our first priority will be to convince the UK Government to take steps to ensure that staff
and students from EU countries can continue to work and study at British universities in the long
term, and to promote the UK as a welcoming destination for the brightest and best minds.”
Dr Wendy Piatt, Director General of the Russell Group explained that “Leaving the European
Union creates significant uncertainty for our leading universities but we will work with the
Government to minimise any disruption caused by this decision. Throughout the campaign both
sides acknowledged the value of EU funding to our universities and we will be seeking assurances
from the Government that this will be replaced and sustained long term.
“The UK has not yet left the EU so it is important that our staff and students from other member
countries understand that there will be no immediate impact on their status at our universities.
However, we will be seeking assurances from the Government that staff and students currently
working and studying at our universities can continue to do so after the UK negotiates leaving the
EU.”
The European Universities’ Association has reacted to the latest development by commenting that
“Despite Brexit, UK universities remain part of European family”. Most importantly, the EUA stated
that it will continue cooperating with British universities, as “the Europe of universities will not be
divided”. Commenting on what the future hold for the special relations of the EU and the UK in the
area of higher education, the EUA added that “This community of knowledge and learning is strong
and longstanding, and it will surely overcome this crisis, although the questions and consequences
of the British exit are certainly formidable.”
Despite stressing that the UK will still play a leading role in the global HE sector, Ian Looker,
Education Lead Partner at PWC, warned that “The result presents significant challenges for the
higher education sector in the UK. Not only is the research funding provided by the EU now at
threat, but also the potential tighter controls over EU staff and students coming to the UK could well
present UK universities as less attractive options to work and study.”
A spokesperson from Universities Scotland said “Higher education is truly global; it transcends
borders. Our relationships with Europe, European universities and other institutions remain very
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important to us and we will work with all Governments and stakeholders to ensure those
relationships are preserved under the new arrangements.
“Our priorities are to influence the negotiations for the terms of Scotland, and the UK’s, future
relationship with the EU. We want to retain the right for staff and students from EU countries to
continue working and studying in Scotland and to negotiate access to European programmes for
students, staff and research. We believe this is compatible with the electorate’s decision and would
be to the benefit of Scotland and the UK.”
Commenting on the result, CaSE Director Dr Sarah Main said: “This outcome provides a real
challenge for our sector. Science is an area where the relationship between the UK and the EU was
particularly beneficial. Not least because scientists won billions of pounds of research funding for the
UK (€8.8bn between 2007 and 2013), above and beyond what we put in. In addition, free movement
of people in the EU made it easy for scientists to travel, collaborate and share ideas with the best in
Europe and for companies and universities in the UK to easily access top talent from Europe.”
She continued, “Many scientists and engineers will be disappointed. The sector consistently showed
huge support for EU membership. Our sector is facing great change with the Higher Education and
Research bill currently going through Parliament. And leaving the EU will no doubt have huge
additional impact on our universities and research businesses.”
“Science is one of the UK's great strengths and works to keep us at the forefront of health, wellbeing
and innovation. It is therefore vital that science is on the table when the difficult and myriad political
decisions that follow are made, from immigration policy to regulation, in order to support a thriving
science and engineering sector in the UK. CaSE will play our part to ensure that they do.”
A University of Sheffield spokesperson said: "…Our University is a Top 100 University globally
and home to staff and students from around the world, including many from other EU nations.
Scholars from these countries are central to the teaching of students and research in everything from
medicine and science to engineering, social sciences and the arts and humanities.”
"Naturally, a vote to leave the EU raises many important questions that require urgent answers - for
universities, staff, students, prospective students, our research partners and other stakeholders. We
will be working closely with other universities across the UK to seek answers to these questions as
quickly and completely as possible. However, we should remember that leaving the EU will not
happen overnight.”
Schools
Malcolm Trobe, Interim General Secretary of the Association of School and College Leaders, said
“There will undoubtedly be effects on the education system, just as there will be in every sector. It's
too early to know what these will be. We will be working constructively with the government to
ensure that the transition is as smooth as possible and that the interests of schools, colleges and
young people are safeguarded. Over the next week we will be working closely with senior civil
servants in the Department for Education to understand the implications for education.”
Martin Doel, Chief Executive of the Association of Colleges, stressed that “Whatever the future
holds for Britain once it leaves the EU, colleges and their students must be properly supported. They
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are, and must continue to be, at the forefront of providing education and training to ensure people
are skilled and that companies stay competitive.
“Colleges are currently planning their budgets for 2016-17 and uncertainty over the future of their
funding leaves them unable to plan accurately for the coming year. The Government must make it
clear as soon as possible how it will continue to fund education and training for the good of
everyone. Specific areas of concern relate to the money pledged for training via the European Social
Fund and the Skills Minister Nick Boles' comments that the apprenticeship levy may need to be
postponed. In an uncertain world, the Government needs to prioritise spending on education and
training."
The Independent Schools Council claimed that the independent schools sector is used to adapting
to change, but added: ‘With a move away from the European Union we will expect, in time, to see
changes to legislation which are specifically relevant to schools. It is especially likely this will
concern international pupils in our schools. At this time of uncertainty schools will be sensitive to the
needs of their pupils and parents. All will continue to focus on their pupils’ welfare and delivery of
the best possible education.”
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Although the exact impact of a Brexit remains unclear, the discussions during the campaign provide
some indication of its ramifications.
Energy bills were discussed extensively, and although energy companies have generally indicated
there will be no short term impact on their customers, National Grid found that leaving the EU could
cost the UK as much as £500m per year in the 2020s because of uncertainty over investment.
Further, many have noted that the EU has been a key to tackling problems around affordability and
security of supply in energy.
However, the Grid report was largely focused on the impact of leaving the Internal Energy Market
(IEM). Businesses appear to be uncertain over whether leaving the EU will definitely leave the IEM,
with SSE stressing that collaboration with EU partners was vital and calling for greater clarity on
future relations.
Should the UK be a part of the EEA, as would be the case if Britain's future EU relationship followed
the Norwegian model, then it could remain part of the IEM. This would mean the potential bill
increase may not be as large as National Grid suggested.
Nevertheless, this uncertainty will inevitably affect business decisions, with the French CGT Union
already calling on EDF to delay its decision to invest in the Hinkley Point nuclear power plant.
Given the influence of the EU on policy related to green technology and climate change, these
industries will also be particularly affected.
The sector’s reaction to the vote has mostly been focused on ensuring the environment remained at
the heart of the energy debate and was discussed in the renegotiations between the UK and EU.
Some have raised concerns that leaving the EU may lead the UK to scrap some of its green targets.
While leaving the EU does not make this inevitable, Mr Cameron was a leading advocate of action to
tackle climate change both domestically and internationally.
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His resignation and rumours of a change in the leadership at the Department of Energy and Climate
Change could thus lead to a change in direction at both the UK and EU level, and Brexit will also
make his successor less influential in international negotiations going forward.
Oil and Gas Alison Baker, UK and EMEA Oil and Gas lead at PWC stated: “The oil & gas industry is a global
business and as a result should be less impacted by today's EU referendum result.”. "However, there
will be some hurdles on the road ahead. Any further downturn in the economy or volatility in the oil
price could cause further distress in the sector and in particular further project sanction deferrals
might have significant consequence for the service sector who also rely on mobility of employees
around the world.”
A Shell spokesperson stated: “Although Shell was in favour of the UK remaining in the EU, we
respect the decision of the majority of the British people who voted to elect to leave. We will work
with the UK government and European institutions on any implications for us. Our priority is to
continue providing reliable, affordable energy to our customers in Europe and the UK.”
A BP spokesperson said: “It is far too early to understand the detailed implications of this decision
and uncertainty is never helpful for a business such as ours. However, we do not currently expect it
to have a significant impact on BP's business or investments in the UK and continental Europe, nor
on the location of our headquarters or our staff. As details of the process for negotiations around the
UK's future relationship with the EU become clear, we expect to engage with both the UK
government and the EU on areas of common interest.”
Energy Market
Energy UK said: “The important message today is people need not worry, the lights will stay on and
power and gas will continue to flow to homes and businesses. Energy UK’s members will work to
ensure energy remains cost-effective and reliable for customers in the UK.”
SSE stated: “SSE believes that the UK Government should be mindful of the importance that the
harmonisation of the GB energy market with the countries in Europe can have efforts to deliver
clean, secure and affordable energy.”
E.ON said: “The UK EU referendum was always a matter solely for the voters and they have now
spoken. It is expected there will now be a period of negotiation led by the UK Government and
during this time and beyond our focus will remain on our customers.”
Dr Nina Skorupska CBE, Chief Executive of the Renewable Energy Association, commented:
“This result raises serious questions for investor certainty, energy security and much needed
investment in the UK energy infrastructure. Energy policy must be a priority for the Government
now, with industry needing reassurance and ministerial clarity on priorities. The first in this list
must be confirmation of the 5th carbon budget, which will hopefully give some confidence in the
long-term direction of UK energy policy.”
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Steve Jennings, Power and Utilities lead at PwC, commented: “Many will applaud the opportunity
to remove perceived European “red tape”. However, this is likely to take considerable effort at a
time when the industry has other pressing issues to address, namely achieving a secure supply,
decarbonising our energy industry and delivering electricity and gas at affordable prices.
"Tackling the energy trilemma will undoubtedly be more challenging without the support of a
European-wide energy system with ready access to European sources of capital and talent.”
Hugh McNeal, Chief Executive of RenewableUK, stated: “The British people have made their
judgement, and of course we respect that. Our focus will continue to be on delivering power to the
UK at the lowest cost. Our future is bright; the European and global opportunities remain immense
for the industries I'm proud to represent.”
Richard Black, Director at the Energy and Climate Intelligence Unit, commented: “Leaving the EU
is likely to put an upwards pressure on energy bills, partly due to the direct financial costs of Brexit
and also the impact of reduced investor confidence. So an immediate challenge for the Government
following this vote will be to prevent bills rising. Affordability and security of supply have been
enhanced by our increasing gas and electricity connections with the EU. A choice for the government
now is whether it wants to continue expanding those connections and hence the benefits to hard-
working British families, or to shut up shop.”
Nuclear
Fiona Reilly, Global Head of Nuclear Capital Projects and Infrastructure at PwC commented:
“Today’s decision to leave the EU could have a significant impact on our nuclear programme.
Ongoing uncertainty in the market, at least in the short term, could affect access to capital and
investor confidence in what is already a limited trading arena. And while the UK government will
need to work out political, trading and legal issues, we will also potentially need to renegotiate our
involvement in the Euratom Treaty and our 123 Agreement with the US - and this will take time.
“It will be vital for the UK Government, DECC and nuclear bodies to work together to secure a
positive outcome for our energy industry and we are committed to working alongside them as they
adapt to these new market conditions.”
Environment
Craig Bennett, Chief Executive of Friends of the Earth stated: “The referendum may be over but
many of the difficult debates are only just beginning”. “The environment was rarely mentioned
during the referendum but it must now move up the political agenda. With urgent issues like
climate change, air pollution and destruction of the natural world already impacting this generation,
not just the next, we don’t have time for the environment to take a back seat through years of
negotiations.”
James Thornton, Chief Executive of ClientEarth stated: “Voters have made their views known on
Britain’s future out of Europe. We respect that democratic decision of course, but it leaves me
shocked, disappointed and extremely decision of course, but it leaves me shocked, disappointed and
extremely concerned about the future of environmental protections in the UK.”
Nick Molho, Executive Director of the Aldersgate Group said: “Environmental and low carbon
economy issues were largely overlooked during the EU referendum campaign…With serious
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environmental issues facing the world economy and with low carbon investment rapidly growing
globally, it is in the UK’s economic and environmental interest to engage positively in international
negotiations on climate change and other environmental issues and support the growth of its low
carbon economy through national policy. Showing its commitment to the Climate Change Act by
adopting the fifth carbon budget and a robust carbon plan to deliver it and making rapid progress
on a 25 year plan to improve the state of the UK’s natural environment must now be essential
priorities for the government.”
David Nussbaum, Chief Executive of WWF, stated: “Environmental challenges don't stop at
borders and many require international solutions. Leaving the European Union brings risks and
uncertainties for our wildlife and wild places, but with the right policies the UK could continue to be
a global force for the protection of nature. As an immediate step we should retain the environmental
protections that have delivered cleaner air and beaches, helped preserve habitats and cut carbon
emissions - and build on them to reverse the environmental decline we are experiencing.”
Jonathan Grant, Director of Sustainability and Climate Change at PwC, stated: “Today’s outcome
is a major setback for the type of collaboration needed to tackle global environmental issues like
climate change”. “With many supporters of Brexit also opposed to climate policies such as carbon
taxes and efficiency standards. The immediate priority will be to provide reassurances to investors to
avoid undermining the low carbon sector”.
Hugh Ellis, Interim Chief Executive of the TCPA said: “The EU has always provided a strong
framework for the built environment, energy, and climate change sectors - taking long term
stewardship of the quality of places we live in. This challenge will now fall to a new government to
ensure that we have the right safeguards in place to protect the environment, prevent flooding, and
ensure that we are building sustainable, high quality places for future generations. The TCPA will
continue to champion the very best of international practice, showing how visionary place making
can transform people's lives.”
Europe The European Round Table of Industrialists stated they were “disappointed that the people of the
United Kingdom have voted in favour of leaving the European Union,” recalling that the
organisation includes “51 Chief Executives and Chairmen of major European multinational
companies, including BP, Vodafone Group, Rolls-Royce and Centrica in the UK.” The association
further stated that “[t]he work is not finished in addressing the challenges the European Union
faces. These challenges are better addressed when the people and the nations of Europe cooperate
together.”
Norway-based NGO Bellona Europa stated: “Britain’s decision to leave the EU marks a sad turning
point, but the collective effort to fight climate change will continue. Society’s effect on our common
environment knows no borders – neither national nor political. Bellona has worked for the climate
outside Norwegian EU membership for over 20 years and will continue to do so while Britain’s
decision stirs both the EU and the EEA-agreement. Our friends and allies in British environmental
groups and the fields most affected by climate change remain among the strongest supporters of the
EU. Their voices will continue to be heard in Europe. Nations cannot solve global issues such as
climate change by being inward looking. Let all European within and outside the EU accelerate
efforts for a better future and environment for all.”
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Jeremy Wates for the European Environmental Bureau stated “All evidence shows that the EU has
brought many environmental benefits for citizens and nature across Europe. It is tragic that these
advantages failed to help convince a majority of people in the UK to vote remain. It is uncertain
exactly what will happen next. However, it is clear that the calls by UK Prime Minister David
Cameron for EU reform based on haphazardly slashing red tape did not influence the debate.
Instead of giving in to short-term demands, it should now be clear to the European Commission,
MEPs and Member States that another way forward is needed to create a Europe that listens to its
citizens and that is fit to tackle the challenges of the twenty-first century, not least by stepping up EU
measures to address climate change, resource depletion and ecosystem collapse.”
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In the wake of the Leave vote, the focus is very much on the financial services industry, as one of the
key sectors expected to be impacted by the result. Given the importance of the sector to the national
economy, and the fact that it is heavily regulated at EU level, the decision to exit the EU has brought
further uncertainty to the industry.
As the result of the referendum became clear early this morning the pound dropped to $1.3236, a fall
of more than 10 per cent, its lowest since 1985. As trading opened this morning the FTSE 100 fell to
5,806.
Shortly after the markets opened Bank of England Governor Mark Carney delivered a statement,
claiming, “Inevitably, there will be a period of uncertainty and adjustment following this result,” and
that, “there will be no initial change in the way our people can travel, in the way our goods can move
or the way our services can be sold.”
Mr Carney assured the business and financial sectors that the Bank had put in place contingency plans
to mitigate against the risks of the referendum, which included the provision of more than £250bn of
additional funds “through its normal facilities.”
The Financial Times reports that the Financial Policy Committee is due to meet next week, and last
month Prudential Regulatory Authority Chief Andrew Bailey said he was having “daily”
conversations with Britain’s banks regarding “how they would cope with an immediate fallout.”
Following the Governor’s statement the pound gained against the dollar, and the FTSE 100 rallied to
just over 6,000.
Investment banks such as Goldman Sachs and JP Morgan had already warned they could relocate
thousands of jobs if Britain opts out of the EU, whilst Morgan Stanley has begun the process of moving
2,000 jobs to Dublin and Frankfurt following the vote. Additionally, the European Banking Authority
announced this week that they will move from London to another European capital if Britain decided
to quit the Union. However, HSBC who also issued a warning about in the event of Brexit, has since
emphasised that the bank’s “commitment to British businesses, customers and staff” adding that it
“remains undiminished” despite the vote result.
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Much of the uncertainty surrounds the UK’s future relationship with the EU and global markets, and
whether the UK would adopt European Economic Area membership, negotiate bilateral agreements
or adopt a WTO-only model. Many analysts see EEA membership as the preferable options for the
financial services; banks from EEA countries enjoy “passporting” rights in the single market, meaning
that they can be regulated in London and then do business across the EU without the need for
regulatory approval from other countries.
A key consideration in the decision to keep business operations in the UK is the timing of the
Government’s invocation of Article 50, officially setting in motion the process to leave the EU. Many
institutions had warned that if the Article was invoked immediately, they would be under greater
pressure to move operations away from the UK. However, with David Cameron stepping down as
Prime Minister by October, the process of leaving the EU will likely be undertaken by the UK’s new
leader in the Autumn.
Focus on the Chancellor
With his political partner the Prime Minister’s career in ruins after unsuccessfully gambling on the EU
Referendum, eyes will inevitably turn to Chancellor George Osborne, both for reassurance amid the
economic turbulence, and in terms of the future direction of the Conservative Party.
It was not a smooth or happy campaign for Mr Osborne, who was pilloried by Brexit supporters after
unveiling what was intended to be a masterstroke of the Remain campaign – an austerity-heavy
“Brexit Budget” designed to absorb the economic damage of leaving the bloc. Or, more cynically, to
send financially-minded voters running scared about the economic consequences of Brexit.
Whatever the intent, the result was not the desired one, and Mr Osborne was left looking damaged
after 57 Conservative MPs announced their intention to block the threatened financial statement.
Indeed, following the Brexit result, Labour Leader Jeremy Corbyn was clearly still dwelling on the
austerity Budget threat.
Mr Osborne has thus far kept his counsel, and is likely focusing his immediate attentions on restricting
the economic damage the day’s announcement has done. Further down the line, it seems highly
unlikely he will be able to revive the pomp of his quasi-candidacy during appearances such as the
speech at last year’s party conference, widely viewed as a leadership rehearsal.
In view of this apparent lame duck status, the eyes of reshuffle watchers will be turning to potential
successors. Energy Minister Andrea Leadsom boasts a strong pedigree that could make her a
candidate for senior Treasury status. Formerly Economic Secretary, she has put in highly effective
Parliamentary performances, and, crucially, was a staunch Brexit supporter without upsetting the
ministerial apple cart.
The House of Commons Library has published a research paper on the Financial Services after the
Referendum.
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Political reaction John McDonnell MP, Labour’s Shadow Chancellor, said “People will be waking up this morning to
turmoil in the markets and the pound crashing, and fearing the emergency budget the Chancellor
threatened to hike their taxes and cut public services. The Government must now take steps to
stabilise the economy, and to protect jobs, pensions and wages. Labour will not allow any instability
to be paid for by the working people of this country”
Financial Services
Financial Conduct Authority stated that “The FCA is in very close contact with the firms we
supervise as well as the Treasury, the Bank of England and other UK authorities, and we are
monitoring developments in the financial markets. Much financial regulation currently applicable in
the UK derives from EU legislation. This regulation will remain applicable until any changes are
made, which will be a matter for Government and Parliament. Firms must continue to abide by their
obligations under UK law, including those derived from EU law and continue with implementation
plans for legislation that is still to come into effect.”
Financial Reporting Council stated "Stakeholders have asked about the implications of the
referendum result for our regulatory work. Our regulatory framework is unchanged and we will
continue to apply it. The FRC will also continue to play its part in representing the interests of the
UK internationally. We will pay close attention to the decisions now taken by the Government and
Parliament, and continue to work in collaboration with our key stakeholders, particularly investors,
business and the professionals we regulate, in order to ensure our work continues to support
economic growth."
Anthony Browne, Chief Executive of the British Bankers Association stated that ““Customers
should rest assured their banking services will continue as normal. People will be able to take money
out of cash machines, exchange currency and have full access to their banking services. Any
consequences of the referendum result will take some time to resolve and any changes to banking
will take place over several years... It is important therefore that the Government only triggers the
Article 50 process after careful deliberation on its aims and negotiating strategy. It is now important
that we have as orderly a transition as possible to minimise the impact on customers both in the UK
and the rest of the EU, and to limit any effect on the economy.”
Wim Mijs, Chief Executive of the European Banking Federation, said: “A significant amount of
contingency planning has already been undertaken by the European banking industry. Banks will
now assess what the result means in the long term. Our industry will now be working towards an
orderly transition to minimise impact on the market in the UK and the EU, as well on the wider
European economy. As representatives of the European banking sector we can assure customers and
businesses that their banking services will continue as normal. Our sector remains committed to
cross-border cooperation in Europe.”
Association for Financial Markets in Europe commented: “The outcome of the EU Referendum and
the UK’s decision to no longer continue its EU membership will shape the direction of Europe’s
financial markets for years to come. This decision will significantly affect UK-based financial services
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firms and their ability to serve their clients and customers across Europe. We are in uncharted
territory and the details of the new EU-UK relationship will now need to be worked out over the
coming months and years. These negotiations will be critical to the future of the UK’s role in
Europe’s capital markets, which are key drivers of economic growth and prosperity in both the UK
and Europe.
Huw Evans, ABI Director General said "The UK insurance and long-term savings industry is strong
and built to protect customers from market uncertainty and shocks. Customers should remember we
remain part of the EU until the process of leaving is complete and they should therefore avoid hasty
decisions about their financial matters. For the UK Government, it will be important now to focus on
ensuring the UK remains a globally competitive place to do business with the best possible future
trading network with the EU and the wider world."
Sergio Balbinot, president of Insurance Europe, said: “We are deeply saddened to hear that the
people of the United Kingdom have voted to leave the European Union. We now hope that
policymakers can work quickly to limit the impact that this time of uncertainty will have on both
consumers and businesses.”
Simon Hunt, UK head of banking and capital markets at PwC, commented "The UK is one of the
world’s leading financial centres. The banking sector plays a major part in generating exports of
£23bn to the EU, which helps to drive an overall trade surplus in financial services of £20bn.
Retaining this position is the challenge that banks and all stakeholders may now have to consider.
One of the most significant benefits of EU membership to the banking sector is the ability to access
the Single Market via the passporting regime and the loss of passporting benefits would have an
impact on the ability of banks authorised in the UK to offer products and services for EU clients.”
Mark Boleat, Policy Chairman of the City of London Corporation said “The City of London has
thrived as a financial and trading centre for more than a thousand years and will continue to do so.
There will be no mass exit of banks and financial institutions from the Square Mile. While there will
be uncertainty as Brexit negotiations go on we are still the financial centre of the fifth-largest
economy in the world. The task now is to respect the will of the British people and secure the best
deal we can in the negotiations that will follow this vote. Financial services contribute £66.5bn in
taxes to the Treasury - 11% of total government receipts - and City businesses I have consulted
believe they must be allowed access to the single market without discrimination.”
Payment Systems Regulator commented saying : “The outcome of yesterday’s European Union
(EU) referendum was a vote to leave the EU. The UK Government will formally notify the European
Council of its intention to leave and the UK will remain a member state of the EU until such time as
UK law changes this as part of a formal withdrawal. We now begin the process of supporting the
Government to ensure we maintain a stable, innovative and competitive payments landscape. Over
the coming weeks and months we will continue to keep the payments industry informed of our
progress and look forward to working with the industry in a productive and transparent manner.”
Lloyd Blankfein, Chairman of Goldman Sachs, said, “We respect the decision of the British
electorate and have been focused on planning for either referendum outcome for many months.
Goldman Sachs has a long history of adapting to change, and we will work with relevant authorities
as the terms of the exit become clear. Our primary focus, as always, remains serving our clients’
needs.”
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Andrew Tate, president of UK insolvency trade body R3, says: “Leaving the EU will have a major
impact on the way corporate insolvency works in the UK. The UK’s insolvency regime does not exist
in a vacuum. It is entwined with rules on employment, tax, property, and more; and all of these are
linked with European rules...While domestic insolvency legislation itself is likely to be unaffected,
the insolvency profession is involved in a lot of cross-border work in Europe. One key change is that
it could become much harder to retrieve assets on behalf of creditors from across Europe. With some
exceptions, once the UK leaves, a UK insolvency practitioner’s powers may no longer be
automatically recognised elsewhere in Europe, nor will UK insolvency proceedings enjoy automatic
recognition. New deals will need to be negotiated.”
Stephen Sklaroff, Director General of the Finance & Leasing Association (FLA), said: “We are at
the beginning of what will be a long process of discussion and negotiation. As the Bank of England
and FCA have already emphasized, the current legal and financial regulatory framework for FLA
members remains exactly as it was before the vote, and it is likely to do so for some considerable
time. The UK has a strong and resilient financial sector and the FLA’s members will continue to
make a vital contribution to the economy. The FLA will work closely with the Government,
regulators and other stakeholders to ensure that its members’ interests are properly reflected in
discussions over the coming months and years about the possible market and regulatory
consequences of the decision to leave the EU.”
Piers Hillie, chief investment officer, Royal London Asset Management said “On the back of this
morning’s result we expect the UK will fall into a recession. Unfortunately I see unstable market
conditions lasting for between three and five years whilst new trade agreements are drawn up. It is
our view that the UK Government will be left with no choice but to stimulate the economy through
fiscal and monetary means, flooding the system with liquidity if necessary.”
Business and Economy
Carolyn Fairbairn, CBI Director-General, said, “The British people’s vote to leave the EU is a
momentous turning point in our history. The country has spoken and it’s for us all to listen. Many
businesses will be concerned and need time to assess the implications. But they are used to dealing
with challenge and change and we should be confident they will adapt. The urgent priority now is to
reassure the markets. We need strong and calm leadership from the Government, working with the
Bank of England, to shore up confidence and stability in the economy.”
Commenting on the resignation of Prime Minister David Cameron, Ms Fairbairn said, ““Businesses
will welcome the decision that negotiations will only begin once the new leadership is in place. The
Prime Minister made clear that all sides should come together to work out the best way forward for
the country - and the CBI, working with our members, will do everything we can to support this.”
Dr Adam Marshall, BCC Acting Director General, said, "In the wake of the electorate's historic
decision to leave the European Union, the immediate priorities for UK business are market stability
and political clarity. Some businesspeople will be pleased with the result, and others resigned to it.
Yet all companies will expect swift, decisive, and coordinated action from the government and the
Bank of England to stabilise markets if trading conditions or the availability of capital change
dramatically. Firms across the UK want an immediate and unambiguous statement from the Prime
Minister on next steps, along with a clear timeline for the UK's exit from the European Union.”
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Andrew Sentance, senior economic adviser at PwC, commented: "The UK leaving the EU is
potentially a big leap into the unknown, disrupting trade relationships with our most important and
nearest trading partner and creating uncertainty for financial markets and business in general. It will
be very important for the government to act quickly to resolve the inevitable uncertainty. The EU is a
vital market for exporters so it will be important that we secure access to that market in any future
settlement with the EU. I would expect that most businesses in the UK want us to keep a close and
positive relationship with the EU even if we are not a full member. That could be done by remaining
a member of the European Economic Area, or by securing our own specific trade relationship like
Switzerland - though this second route is likely to take much longer and be more difficult to
negotiate.”
"It is important to keep things in perspective, but in the short-term, we need to brace ourselves for
more volatility. The final polls yesterday were pointing to Remain and this was the general
expectation of financial markets. This potential shock could hit the pound and stock markets badly,
and push up the cost of borrowing because of the additional political risk.
Peter Cheese, Chief Executive of the CIPD, the professional body for HR and people
development, comments, “Now that the British people have had their say on Britain’s future
relationship with the EU and voted to leave, it’s important that the Government and UK businesses
take time to properly assess the long-term impacts of any decisions that they take going forward.
“The impact of a ‘leave’ vote is much bigger than simply changing the political landscape of the UK.
It stands to have a significant impact on the world of work and future planning within organisations.
We need a broad and thorough consultation between government, organisations and employees
across all sectors and representative bodies. The CIPD will play its part in these necessary
consultations drawing on our strong base of evidence and experience of the world of work. It’s
important that the Government takes the time to really understand the impact of any proposed
changes and works with businesses to minimise risk to individuals, organisations and the economy.”
Mike Cherry, Chairman at the Federation of Small Businesses, said, “FSB calls on the Government
for clarity on what these decisions now mean for business, including how businesses will have
access to the single market and the free movement of people and trade. Nearly a quarter of FSB
members export, with the majority exporting to the single market. Access to the single market means
access to 500 million potential consumers, more than 26 million businesses and is worth 11 trillion
euros. We call on the Government for clarity on the impact to smaller firms who export wider afield
through EU FTA agreements.”
Terry Scuoler, CEO of EEF, the manufacturers’ organisation, said, “While it is not the result many
businesses wanted, it is the democratic will of our country. The Government must now move very
quickly to stabilise the economy, reassure the markets and shore-up business confidence. The
process of leaving the Union will take some time, and the Government should not rush to initiate
Article 50 and the formal exit process, while there is so much uncertainty. Ministers must think
carefully about our negotiating position while setting out a clear roadmap for establishing a new
deal with the EU which remains our biggest market and trading partner.
Simon Walker, Director General of the Institute of Directors, said, “While this may not have been
the result that the majority of our members wanted, Britain has voted to leave the EU, and it is now
imperative that our political leaders manage the transition as smoothly as possible. The weeks and
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months ahead are going to be a nervy time for business leaders, so they have to know that the
Government is focussed on maintaining stability while a new relationship with the EU is
established.”
The Local Government Association said, “Councils in England need a seat around the table when
decisions are taken over how to replace EU laws as part of the UK’s exit negotiations. It is vital that
local government is part of the team. EU laws and regulations impact on many council services, such
as waste, employment, health and safety, consumer protection and trading and environmental
standards. There cannot be an assumption that power over these services is simply transferred from
Brussels to Westminster. If services are delivered locally, then the power over how to run them
should rest locally too. Decades of centralised control over funding and services has distanced our
residents from the decisions that affect their everyday lives. With greater control in our areas we can
improve services and save money.”
Frances O’Grady, TUC General Secretary, said, “The British people have made their views clear. As
the UK prepares to leave the European Union, the first priority now is to protect jobs and defend the
living standards of working people. The government must urgently set out a plan to defend UK
industry and keep British jobs. That means defending the pound and stimulating the economy.
Working people must not pay the price for the decision to leave the EU.”
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As the full impact of the British electorate’s decision to vote to leave the European Union continues
to unfold, the immediate focus has centred on Vote Leave’s claims that Brexit would lead to savings
of £350m, and that money would be injected into the NHS.
In a bid to downplay the economic impact of Brexit, UKIP Leader Nigel Farage has already
denounced his campaign rivals’ pledge that the NHS would receive extra funding as a “mistake”.
Health Secretary
Jeremy Hunt has said that being Health Secretary would be his last major job in British politics, and
with stability high on the Government’s agenda, it is likely Mr Hunt will remain in post until
October. Reports suggest that Mr Hunt could support Work and Pension Secretary Stephen Crabb’s
potential bid for Conservative Party leader, and could be his campaign manager.
Funding
During the referendum campaign, the health sector was largely united in support of Britain’s
continued membership of the European Union, with statements and speeches replete with clear
pronouncements that Brexit would negatively impact a sector already under unprecedented
financial pressures.
In one of the major interventions in the campaign, NHS England Chief Executive Simon Stevens
argued that Brexit would be “very dangerous” for NHS finances, staff and drug prices.
A strong economy was the basis of a strong NHS, Prime Minister David Cameron and Mr Stevens
consistently argued.
But with high levels of market volatility and the dramatic decline of the pound in response to the
result, George Osborne’s pronouncements that there would be an emergency Brexit budget look
increasingly likely. Political and economic uncertainty mean efforts to stabilise the UK economy will
take precedence, as reports suggest a recession is possible.
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The Conservative leadership election will undoubtedly occupy the Party machinery and
Government, so it is unlikely that the Department of Health will pursue any major policies changes
before the Conservative Party Conference in October. Incisive Health has suggested that the
Childhood Obesity Strategy, expected to be published in the summer, could be the “first casualty”.
Following Brexit, there is possible uncertainty over the future of the NHS (Overseas Visitors
Charging) Bill, published in the Queen’s Speech this year. Brexit negotiations mean the nature and
provisions of the Bill could be subsumed into wider discussions about Britain’s Brexit negotiations.
If, as suggested, another General Election could take place in 2017, HSJ Editor Alastair McLellan has
suggested that it could give Simon Stevens the opportunity to renegotiate the Government’s
spending pledge.
NHS staff
NHS leaders have echoed comments made by former Health Secretary and Conservative peer
Andrew Lansley, as he tweeted a plea for NHS workers to be reassured that they are valued.
NHS England Medical Director Sir Bruce Keogh reflected: “It is really important we make them feel
welcome. If you are a European doctor or nurse you might not feel too welcome at the moment. The
essence of delivering high quality care is dependent on a workforce that feels valued and secure”,
the HSJ reported.
EU regulations, laws, and pharma
Unwinding Britain’s 43-year membership with the EU, upon implementing Article 50 of the Lisbon
Treaty, will undoubtedly produce legal and regulatory uncertainty.
As Incisive Health has suggested, the Department of Health could pass legislation to “freeze” the
existing body of statute, so that no laws will change without the consent of the UK Parliament. Such
measures are designed to provide certainty around EU Regulation that has legal authority, without
passing into UK law.
Furthermore, the HSJ highlights uncertainty around the European Working Time Directive, which
will would no longer apply if the UK exits the EU and does not join the European Single Market. It
suggests that the junior doctors’ contract is likely to become a legally binding contract, but the
Working Hours for Agenda for Change Staff would not be protected.
Health and pharmaceuticals are not areas of EU competency, meaning that it is for the member
states to determine their own national policies on the issues.
However, the withdrawal of Britain’s membership from the EU is expected to affect both industries,
as the EU still regulates a number of specific aspects, especially pertaining to medicines’ pricing,
authorisation and patents.
The future of the European Medicines Agency (EMA) is under question, as it is based in Canary
Wharf, London. It is expected that the agency will temporarily move to Brussels, with speculation
that the EMA could be based in Alicante, Spain circulating. Sweden and Denmark have also claimed
the regulator.
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Nevertheless, the loss of British experts to the EMA drug approval system will be seen as a
significant loss to the organisation’s scientific capacity.
Turning to the future of the UK pharmaceutical sector, there are two scenarios on the table. The first
implies that the UK will continue to be a part of the EMA, although it would have no influence over
the body.
The second scenario suggests that the UK pharmaceutical industry could potentially align itself with
the US equivalent of the EMA, the Foods and Drugs Agency (FDA), thus creating a global regulatory
‘superpower’ for the industry.
British access to healthcare in European member states Questions have circulated over the access of British citizens to healthcare in member states of the
European Union, meaning access to the right to cross-border healthcare. In addition, Britons would
also lose open access to information and expertise.
Pharmaceuticals
Following the result of the United Kingdom's referendum on membership of the European Union,
Mike Thompson, CEO of the Association of the British Pharmaceutical Industry (ABPI) has said:
"The voice of the British people has been heard. This creates immediate challenges for future
investment, research and jobs in our industry in the UK. With that being the case, we are committed
to working closely with the government to agree what steps need to be taken to send a strong signal
that the UK is open for business."
Steve Elliott, Chief Executive of the Chemical Industries Association said “This is democracy in
action – both in terms of the result and the level of participation. It is not the decision that our sector
wanted, but we fully respect the wish of the people for change… This morning I am calling on the
Government to work hard on securing the best exit plan for the UK and then establishing the new
trading arrangements.
Health Services / Welfare Disability Rights UK has said: “Many disabled people, on all sides of the debate, are angry that they
have been left out of opportunities, left living in poverty – and we want to enable more people to
have a bigger voice. For us as a network of disabled people and our organisations, what is important
next is to make sure that:
Disabled people’s hard won rights are not eroded as the UK negotiates its way out of the
European Union. For instance, there are proposals for new European Accessibility legislation
covering accessibility of public sector websites and accessibility of a range of products and
services. We need to make sure that as the UK de-links itself from EU law this isn’t at the
expense of important new rights like that – and not at the expense of existing rights, like the
protections in the European Convention on Human Rights, which have helped families to
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stay together and individuals to improve their care and support. We will press Government
to ensure international rights are enshrined in UK law.
We put the full and equal participation of disabled people at the heart of the thinking of the
new leadership of the UK. We profoundly believe that if all disabled people can participate
fully it benefits everyone. We will press Government to ensure that in a potentially changed
economic environment there is a commitment to support and income for independent living,
and no further squeeze on funding of the supports that disabled people need
We stand up to intolerance of difference and ‘othering’ of disabled people whenever and
however it occurs.”
Quentin Cole, Health industries lead Partner at PwC, commented: "The NHS is facing
unprecedented financial difficulty and needs a long-term sustainable funding settlement to allow it
to navigate the real challenges it faces. This result makes that less likely as we face the very real
prospect of economic uncertainty.
Stephen Dalton, Chief Executive, NHS Confederation, said: "The NHS has broadly benefited from
being in the EU and leaving it will undoubtedly have implications which are yet to be clearly
understood. The priorities for those who lead and are on the frontline of delivering NHS funded
services are the sustainability and quality of patient care.
“It is impossible to predict the full impact at this stage, but clearly it is vital that our government
seeks a strong, nuanced agreement with the European Union that recognises how interwoven NHS
and EU policies have become.”
Greg Burns, Deputy Head of News and Internal Communications at the Local Government
Association said: "EU laws and regulations impact on many council services, such as waste,
employment, health and safety, consumer protection and trading and environmental standards.
"There cannot be an assumption that power over these services is simply transferred from Brussels to
Westminster. If services are delivered locally, then the power over how to run them should rest
locally too.
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The morning about the EU Referendum, the most immediate concern of tens of thousands of Britons
will be the impact of a Leave vote on their holiday plans. All eyes will be on the money markets to
see how the Pound fares against foreign currencies after its initial plunge.
In addition, the aviation sector will be watching to see what immediate impact a Brexit vote will
have on cheap air travel. Airline Ryanair’s flash sale of seats to European destinations speaks of a
desire to capitalise on consumer uncertainty.
Aside from the impact on cheap foreign travel, questions remain over the provisions the UK
Government will put in place to ensure the protection of foreign holidays. An example of this would
be the decision of the European Parliament to strengthen protections of package holidays last
November.
More than that the regulatory framework concerning the aviation sector has been thrown into doubt.
Prior to the referendum, the UK Government had been committed to working towards the European
Commission’s Single Sky initiative. However, European aviation laws could be extended to the UK,
if the country joins the European Economic Area (EEA) like Norway. A bilateral aviation agreement,
along the lines of the one governing Switzerland is also possible. Either outcome would likely meant
the UK having to sign up to all existing rules and regulations. Bilateral agreements with US, Canada
and other countries on traffic rights would be needed.
Exports are the name of the game for the automotive sector, with half of all export going to the EU.
Manufacturers like Nissan could consider the future of the UK-based operations, in light of
uncertain trade rules. Questions will also emerge over environmental standards and what could
replace them.
The rail sector’s franchising process and ability to participate to tender would be called into
question. For the Labour Party, departure from the EU could mean being freed from the integration
and liberalisation agenda of the railways, opening up a route for it to pursue its policy of re-
nationalisation.
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Closer to home, the decision of David Cameron to stand down as Prime Minister throws the decision
over runway expansion in the South East of England into doubt. In spite of rumours that a final
ruling would be taken within a fortnight of the referendum, a caretaker Prime Minister does not
have the authority to make such a controversial decision. The question will mostly likely fall to
whoever is the next occupant of Downing Street.
In the interim period, Mr Cameron has insisted that his Government will continue in office and
pursue its legislative programme set down in the Queen’s Speech. Of the three transport bills
contained in that programme, two are already before Parliament in the Lords, the High Speed Rail
(London – West Midlands) Bill and the Bus Services Bill. These will have time to progress, but after
October, their fate will be in the hands of the next Prime Minister.
Aviation
Heathrow Airport said: “With today’s result, the case for expansion at Heathrow is stronger than
ever before. Only Heathrow can help Britain be the great trading nation connecting all regions of the
UK to the world. It is the keystone that connects businesses of every size to markets across the world
as the UK’s only global hub airport.”
Tim Alderslade, Chief Executive of the British Air Transport Association (BATA), said “We fully
respect the will of the British public as expressed in the result of the referendum to leave the EU. The
Government must now urgently confirm that the UK will seek to remain a member of the European
single aviation market once we leave the EU. We also call on the Government to prioritise all
aviation-related negotiations, agreements and decisions during the EU withdrawal process.”
International Airlines Group said “International Consolidated Airlines Group, S.A. (IAG) believes
that the vote to leave the European Union will not have a long term material impact on its business.
In the short term, however, in the run up to the UK referendum during June, IAG experienced a
weaker than expected trading environment. Following the outcome of the referendum, and given
current market volatility, while IAG continues to expect a significant increase in operating profit this
year, it no longer expects to generate an absolute operating profit increase similar to 2015.”
Carolyn McCall, easyJet Chief Executive said: “We remain confident in the strength of easyJet’s
business model and our ability to continue to deliver our successful strategy and our leading returns.
We have today written to the UK Government and the European Commission to ask them to
prioritise the UK remaining part of the single EU aviation market, given its importance to trade and
consumers.”
The Civil Aviation Authority said: “Following the referendum on EU membership there will be no
immediate change to civil aviation regulation nor the CAA's role in the EU and the European
Aviation Safety Agency. Any future changes will depend on the outcome of the UK's negotiations on
exiting the EU. We will be working closely with the Department for Transport in assisting the UK
Government in the months ahead as discussions progress.”
Tom Enders, chief executive of Airbus said this is a "a lose-lose result for both, Britain and Europe"
and hopes that "the divorce will proceed with a view on minimising economic damage to all
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impacted by the Brexit". On the future of the relationship between Airbus and UK, Mr. Enders said
that Airbus “will review our UK investment strategy, like everybody else will”.
A Birmingham Airport spokesperson said: “ “The EU referendum result doesn’t mean that we will
immediately see a change to our lifestyles, the way that we travel or how our European nationals
living and working in Britain will be affected.” “Nor will it mean that we will disconnect with our
European partners overnight. It is far too early to speculate about any of these important issues – this
is an unprecedented situation after all. But it’s important to keep clear and calm heads so that we can
ensure that our regional priorities, such as HS2, keep moving forward to ensure the future of
Midlands’ residents, workers and industry, is not compromised.”
Richard Branson, owner of Virgin group, stated that he “wanted the UK to remain in the EU” and
views the exit as a “a very sad decision that will do enormous damage to both Britain’s economy and
Europe’s stability.”, but at the same time made it clear that “we must all accept and respect the
majority vote.”.
Automotive Sector
According to the BBC in an interview with Reuters, Andy Palmer, Chief Executive of Aston Martin,
has warned that Britain's exit from the European Union was likely to require additional
"productivity and efficiency" gains at the British sportscar maker given the possibility of new trade
barriers. He asked the UK government to push for tariff-free access to EU markets, adding that a
weaker pound should "partially offset" the increased instability.
BMW said "Today, we know that many of the relevant conditions for supplying the European
market will have to be re-negotiated, but of course we cannot say what this means for our UK
operations until those future regulatory and legislative arrangements are agreed," a spokeswoman
told Reuters.” "We will not speculate about the outcome of these negotiations nor about any possible
effects that might have on our production operations in the UK.”
Jaguar Land Rover said: "We are a British business with a strong manufacturing base in this country,
we call Britain home and we remain committed to all our manufacturing sites and investment
decisions.” "We respect the views of the British people and in line with all other businesses, Jaguar
Land Rover will manage the long-term impact and implications of this decision: nothing will change
for us, or the automotive industry, overnight."
Gary Keaney, Chief Executive BVRLA said: “The first priority for the Government is to restore
economic stability to the UK market.” “For its part, the association will be working closely with UK
and European policymakers to ensure that the exit process has a minimal impact on members and
their customers.” “We remain confident that BVRLA members will adapt – after all, our sector is
very experienced in dealing with challenge and change.”
Infrastructure
Dr Nelson Ogunshakin OBE chief executive of Association for Consultancy and Engineering said:
“The political implications of the vote are very worrying for our industry. Travelling up and down
the country I was made aware by our members that the stability provided by the UK’s membership
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of the EU was vital to the investment decisions needed to build the infrastructure network in our
country.
ACE has advocated hard and long to provide stability to our industry through the creation of a
National Infrastructure Commission, a National Infrastructure Delivery Plan and an infrastructure
and Projects Authority but this vote will challenge all we have achieved. Working with our members
and the wider industry, ACE will be campaigning to ensure that the UK government understands
the vital part that economic and political stability play in the investment cycle.”
Marie-Claude Hemming Head of External Affairs, Civil Engineering Contractors Association
urged calm and called on Ministers “to now to first stabilise Government, then re-establish their
commitment to the projects outlined in the National Infrastructure Plan, most notably HS2 and a
third runway at Heathrow in order to maintain economic confidence following such a substantial
change in the UK's relationship with the European Union and the rest of the world.
Rail
ASLEF said: “As a trade union which backed a vote to leave the European Union we acknowledge
the decision the people of the United Kingdom have taken. ASLEF respects the self-determination of
the British people. Today’s verdict reflects the inability of successive governments to meet the
aspirations of people particularly in providing affordable housing and secure employment. There
has also been a failure to make the case for immigration. These reasons underpinned a deeply
divisive referendum campaign. ASLEF will continue to campaign to protect workers’ rights in the
UK and abroad and to safeguard our vital public services including the NHS. International solidarity
between British workers and European workers existed long before the European Union and will
continue long into the future.”
Shipping
The UK Chamber of Shipping said: “Leaving the European Union is a process, not an event, and
that process has to be managed carefully. David Cameron’s decision not to immediately invoke
Article 50 is a welcome one, and there should be no rush to do so for his successor. First we must get
our chess pieces in place.”
“We believe that Government should establish a new Free Trade Commission, working across the
Department for Business and the Foreign Office, to train trade negotiators and begin the process of
establishing new trading ties around the world and be ready for the negotiations with the remaining
members of the EU.”
Freight
The Freight Transport Association said coming out of the EU risked new costs, restrictions and
bureaucratic requirements being imposed on moving foods in and out of Europe. The FTA called on
the Government to prioritise arrangements for international freight transport in its negotiations,
minimising additional legislation and keeping costs as low as possible.
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