Sophy Ridge on Sunday Interview with Carolyn Fairbairn Dir Gen CBI


SOPHY RIDGE: Well we’ve heard from the politicians, now it’s time to hear from the voice of business. Carolyn Fairbairn, the head of the CBI, joins us now, thank you very much for being with us. You were last on the show in November, do you feel more confident or less confident about Brexit now?

CAROLYN FAIRBAIRN: Oh well Sophy, I think we really are in the emergency zone of Brexit now so I think last November we had the possibility of a deal on the table and that has now receded, we don’t have a deal on the table. Firms are having to plan in the here and now for a no-deal Brexit with all of the pain that that will bring. We know that businesses are leaving the country, we know that businesses are making plans that will damage communities across the country and just this week we had a new chapter in the unfolding nightmare that the trade deals that the UK businesses enjoy through the European Union will not be ready in time for leaving. So South Korea in particular, a real concern for business, so it really is the emergency zone.

SR: Your deputy attended a meeting with Liam Fox about the possibility of the existing trade deals that we enjoy as being part of the EU being rolled over, what is the position as far as you understand it?

CAROLYN FAIRBAIRN: Well I think that Ministers and officials have been working very hard so it’s not for want of trying but it’s genuinely hard because partner countries who we have enjoyed free trade deals with now for a number of years under the EU are actually saying well we want to see what your EU relationship is first. Japan is saying that for example, South Korea one of our main trading partners, they want open terms so the prospect is the day after Brexit those deals will disappear.

SR: And what does that mean for jobs, what does it mean for normal people?

CAROLYN FAIRBAIRN: Well I think the really important thing about what business says matters is that this is how Brexit will be felt in communities across the country. It will be the decisions that businesses take about jobs and investment and they will reduce them, so you have less potential to trade globally, that will mean less investment in the future and that will mean fewer jobs in the future and we have seen Sony move its headquarters, I am talking to businesses that are planning for price increases and for job reductions after a no-deal Brexit. This is very, very real now.

SR: You were saying when you were last here how there was at least the prospect of a deal and you feel that is now receding. What do you think are the chances of a no-deal?

CAROLYN FAIRBAIRN: Well the chances have gone up because the possibility of the Prime Minister’s deal passing have receded and I think what business is saying is compromise, find that middle ground and at the moment it feels like the parliamentary process is in log jam, no way can be found through so that prospect of no-deal feels much higher but what I think business, everyone I speak to says get round the table, find that compromise and find that deal so that we can take …

SR: Could the compromise be the Jeremy Corbyn proposal of a permanent customs union?

CAROLYN FAIRBAIRN: Well there are a number of things. When that letter was published I think businesses would have looked at that and thought there are a number of things here that could work for business. We at the CBI have said that a customs union of some sort would be a good thing for most businesses but it’s not the only solution so with that on the table now from Labour we would really urge politicians from all parties to get round the table and find a solution on that. There isn’t just one model that will work for business – that would work but there are others.

SR: But basically you’re saying any deal is better than no deal, is that what you’re saying?

CAROLYN FAIRBAIRN: The things that matter for business are frictionless trade, access for our services and access to people and talent. Any deal that delivers along those lines will work for business. The issue now is time and we are heading towards that cliff edge so we need that deal.

SR: So talking about the issue is time, there’s less than 50 days to go until Brexit so what are businesses doing right now?

CAROLYN FAIRBAIRN: Well I think there has been real acceleration in the planning so we have got stockpiling, we know that warehousing capacity has run out, they are preparing for disruption at borders but I think that the bigger thing that’s going on is that there is also a real calibration if you like of what the UK is like as a place to invest. We have been a fantastic country to invest in for many years, a gateway to Europe, we have got a time zone, great universities and yet industries are looking at the UK and asking questions about what we’re like for the long term, hence the decision by Nissan. Brexit wasn’t the only factor but it was one.

SR: So have you been conversations with companies who are telling you they are not going to invest or that they are going to leave as well?

CAROLYN FAIRBAIRN: Absolutely. So there are plans are on the [stocks?], they are still travelling in hope around a deal so some have taken action but others are waiting. Many small businesses have not been able to take action at all so they will be hit by the shock but the point is that we have this opportunity now to get a deal on the table, pass it and move on and return the UK to being the great place to invest that it has been. This is real danger time now.

SR: It’s interesting hearing you talk, when you look at what’s happened in Westminster, what do you feel towards politicians?

CAROLYN FAIRBAIRN: I think there is just an astonishment that can turn into anger actually because we have a political process here that is not delivering a solution for our country so here we are, ten years on from the financial crash, we have a risk here that we are going to recreate some of the conditions around the financial crash. The Bank of England today has a forecast that puts growth at the lowest it has been in the last ten years. Why would we voluntarily do that to ourselves as a country? We know that the financial crash harmed the youngest in our population most, young people in the workplace so why would we do that again? I think there is a sense that this is almost negligence on behalf of our political institutions, our political leaders in not delivering a solution to this. We have 47 days left, that solution needs to be found.

SR: Is it Brexit that’s the problem or the way that it’s been handled?

CAROLYN FAIRBAIRN: I think Brexit, the decision that was taken 52/48 was always going to be challenging however here we are 47 days to go, again that number, and actually we are not any further on if you are a business, in terms of having clarity about what the trading environment will be when we leave and the process has not delivered any clarity at all so we need that to happen very fast now.

SR: Okay, a clear message, thank you very much for being on the programme.