No-deal chaos: FSB calls for money from Government to help firms prepare

With a no-deal Brexit still on the cards, the Federation of Small Businesses (FSB) is calling urgently on the Government for financial support for small businesses trying to make preparations.

This follows the findings of its latest survey of no-deal preparedness, which showed that among those small firms that believed a no-deal would have a negative impact on them (39%), only one-in-five (21%) had made any concrete plans.

More worryingly, two-thirds (63%) said they didn’t think they were actually able to do any planning for a no-deal Brexit.

And for those that have made preparations, they have come, said the FSB, at a high price – around £2,000. That cost rose to £3,000 for smaller businesses that export and import. Just under a third (31%) of businesses revealed they had stockpiled ahead of the Brexit deadline of October 31, while just over a third (34%) said that profitability had been temporarily or permanently reduced.

Almost half (46%) of those firms planning to get ready for a no-deal thought currency volatility would have a negative impact and the same number expected a negative outcome from a no-deal Brexit and said they would welcome some form of financial support from the Government.

Answering this plea, FSB national chairman Mike Cherry renewed calls for financial assistance, suggesting that vouchers for up to £3,000 would help forms prepare for a potential no-deal and reach new global markets.


He also proposed that there should be an early Budget with measures to help with cash flow, including a temporary reduction in VAT, an uprating of the employment allowance, expanding HMRC’s time-to-pay scheme and opening out the two-year retailers’ business rates discount of 33% to a wider range of smaller businesses.

Cherry commented: “As the risk of a chaotic no-deal Brexit on October 31 remains alive and kicking, it is worrying that many small firms have either not prepared or are finding they can’t prepare.

“Ongoing uncertainty is to blame for preparations hitting the skids with the picture still not clear as to how the UK will leave the EU. Until we get clarity, small firms must prepare for the cliff edge where possible, and make preparations for a no-deal Brexit.

“Preparing for this outcome is coming at a high price. Government must use what little time is left to provide small firms with the support they need to navigate the uncharted and turbulent waters of a no-deal Brexit.

“The Government must also turn to meaningful financial support. This is desperately needed and would certainly provide a much-needed shot in the arm for those firms that have already spent money preparing.”

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