Tough on Brexit. Tough on the causes of Brexit - KPMG United Kingdom
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The Brexit Column: Tough on Brexit, tough on the causes of Brexit

Tough on Brexit. Tough on the causes of Brexit

If a second Brexit referendum starts to look more likely, business will need to articulate a very different vision of their purpose, says Mark Essex.


Director, Public Policy

KPMG in the UK


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Have we been focusing on the daily minutiae of Brexit and losing sight of the bigger picture? In reality, Tuesday’s pivotal parliamentary vote is only one in a series of staging posts to a destination that is still unknown. What comes next? And how should these possibilities affect how we prepare?

Yesterday’s Times newspaper published a handy flow chart to help answer the question of what comes next – neatly laying out the sheer complexity of what could unfold. It offered six starting scenarios, leading to eight potential outcomes, via 46 different routes. End-states ranged from ‘no deal’, a government of national unity and a general election to Norway plus, agreeing the current Withdrawal Agreement or a revised version of the same.

Another option is a second referendum. The political, practical and intellectual hurdles are still viewed as high (the Times charted only three routes to get there). Nonetheless, while our firm advice to businesses remains to keep planning for ‘no deal’, it’s interesting to ask what position business would take if such a scenario arose.At last week’s FT Brexit and Beyond Summit the audience of business leaders recognised that the views of their customers are divided and a concern in the room was that a referendum would reconfirm that split vote. There was a general sense of the need to acknowledge the underlying causes of the original result.  I commented that a campaign labelled “Remain” was always going to have something of an image problem in parts of the country where people felt an overwhelming desire for change. It was a point that the headline speaker, Tony Blair, agreed with.

The Growth Agenda

For me, Brexit was like a heart murmur in society: a warning that something needs to change. If we don’t, collectively, take action to fix the underlying causes, we risk society suffering the full heart attack.

Many of those running businesses would, all things being equal, vote to maintain the operating environment and certainty on which they have developed their businesses over decades. Others want the swiftest-possible end to the whole Brexit debate. It’s not clear to me that there is a single business view.

Where I think we can agree, is on the need to acknowledge and address the underlying causes which many believe led to the vote to Leave in the first place. Businesses are well-placed to help deliver a more regionally-balanced kind of economic growth. I call this the Growth Agenda, which – to misquote a former prime minister – would be ‘Tough on Brexit. Tough on the causes of Brexit‘.

The Growth Agenda is an idea we will develop in future editions of this column. But for now, here are agenda items one and two:

One: Invest more outside London and the South East and diversify our economy: In 19th century America, a gold rush town would shut down when the gold ran out. In the UK, we see towns where the jobs created by industries have gone but the people who performed them have been left behind. Business would need to play an active part in helping re-skill and re-employ them, alongside the right policies and incentives from central and local government. Spotting the potential of people and places is something businesses are good at. 

Two: Bring some disruptive thinking to delivering public services so we don’t have to wrestle with the unenviable trade-offs of quality versus cost. I have put forward a few ideas along these lines in our recent report, ”Reimagine Public Policy”. The report includes ideas to help benefit claimants avoid the choice between heating and eating, rehabilitate prisoners and, importantly, original ways to build more homes without troubling the deficit.

These ideas are only going to work as part of partnership between business and government. The best structure in which to make that happen is through the government’s Industrial Strategy.

It is surely a cause around which we can unite. Let’s seize the Growth Agenda together.

This article represents the views of the author only, and does not necessarily represent the views or professional advice of KPMG in the UK. You can register for the email subscription list of this column and expert views from our Brexit leaders.

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