Government should ensure tariff free access to single market post-Brexit, says CBI

The Confederation of British Industry laid out the principles Britain should ensure in its future relationship with EU, as it revealed its shopping list of measures for the Chancellor to heed in the upcoming Autumn Statement.

CBI has called for the government to protect the principles needed for business to flourish post-Brexit, by ensuring tariff and barrier free access to the EU single market adding that there needs to be a “proper strategy” to secure trade deals beyond the EU.

There is currently debate on what type of relationship the government should seek, a ‘hard’ Brexit – adopting World Trade Organisation rules regarding the single market and customs union while curbing the free movement of people, or a ‘soft’ Brexit – retaining some access to the single market, in return for a degree of free movement of people.

The City is particularly concerned about retaining passporting rights, which makes conducting business across the EU easier for financial institutions through a single licence.

According to the business lobby group, there should be regulation where the country benefits from having the equivalent regulation from the EU, and that the economic and social benefits the country had as a member of the trading block should be protected, such as EU funding.

CBI also said access to skills, talent and people was important for business as it was required for growth.

Carolyn Fairbairn, director-general of the CBI, said an informed discussion on immigration and its different types was needed.

“We do need to talk about skilled immigration, students, less skilled workers who come to our country as well because all those categories have different kinds of contributions and are actually seen differently by the public.”

Meanwhile, in its proposal for the Autumn Statement on 23 November, the CBI said that to navigate the uncertain economic outlook in the wake of Brexit the Chancellor should “invest for the future and get all regions firing on all cylinders” through a £11.5bn list of measures, which should fall to £7bn by 2020/21.

This includes a rise in average public sector net investment spending to 2% of GDP this Parliament, it is currently forecast to fall to 1.7%. This would increase average public spending by £6bn, to be partly spent on improving local transport infrastructure.

It also includes £2.1bn to be spent on extending maternity leave to encourage women to work.

Chancellor Phillip Hammond previously said he would “reset” the public finances in response to the EU referendum result, in contrast to the austerity measures of his predecessor George Osborne, but ruled out a spending “splurge”.