Small businesses call for new SME minister as MPs hear Brexit red tape is costing jobs

• Small businesses have called for a new dedicated trade minister to help them cope with Brexit red tape costing them jobs and business

• Small and medium sized enterprises (SMEs) from all UK nations and the 'Red Wall' have told MPs they face an existential threat from increased costs and falling incomes after Brexit.

• The British Chamber of Commerce has cast doubt on 'teething problems' claims as problems persist and trade with other countries fails to replace lost EU orders.

• Recent polling shows two thirds of small businesses want greater cooperation with our closest trading partners

Small businesses today called for the appointment of a new dedicated minister in the Department for International Trade to help them navigate challenges following Britain's withdrawal from the EU.
 

At a session of the cross-party UK Trade and Business Commission today SMEs warned that they face an existential threat from the increased costs and falling incomes from Britain’s new trading relationship with Europe.
 

The Commission, launched last month by pro-internationalist campaign group Best for Britain, held its fourth evidence session today looking at the costly red tape imposed on small businesses by the UK’s bare bones trade deal with the EU. This includes firms based in so-called 'Red Wall' areas, amid warnings that Brexit trade barriers are threatening the government’s levelling up agenda. 

One such business is Fluorochem, who employ 50 people in High Peak, Derbyshire. For 50 years they have supplied chemicals for research and development mainly across Britain and Europe including to manufacturers of Covid vaccines. They spent approximately £250,000 on new IT systems and will now have to make similar investments in other countries to retain their EU client base

In his oral evidence to the Commission, Lee Jones, Managing Director of Fluorochem, said: “We’ve investigated every possible solution…In a nutshell if nothing is resolved this year, because we cannot afford to sit around and wait for things to potentially come up in twelve months or two years, we will relocate. It is impossible to remain competitive in Europe by shipping from the UK using the current methods... It’s an absolutely crazy system." Mr Jones went on to recommended that a dedicated minister of trade for SMEs would be required to help them navigate these issues.

Jin Talog, an organic gin distillery based in Carmarthenshire have found that increased duty  and courier costs have made their product uncompetitive in what was once an expanding market for them within the EU. In his oral evidence to the commission, David Thomas,  Founder of Jin Talog said: “It’s essentially killed off our business… sending a delivery to Dusseldorf used to be as easy as sending it to Doncaster but now it’s just a non-starter.”

The session also heard from trade experts from the Federation of Small Businesses and British Chambers of Commerce, who cast doubt on government claims that the issues represent teething problems. Suren Thiru, Head of Economics at the British Chamber of Commerce said: "There certainly are some teething problems, so businesses filling in the wrong paperwork and that sort of thing, but in terms of balance, more of it is on the long term structural issues of the deal that means that exporting to the EU may not be viable for some businesses longer term."
 

The Commission will be using today’s evidence to inform urgent cross-party recommendations to the Government on how small businesses can be better supported. Polling by Best for Britain shows that two thirds (66%) of small businesses back greater cooperation with Europe on trade.

Liz Saville Roberts MP, who sits on the Commission and who chaired today’s session, said:

“Exporting jobs and losing business is the opposite of levelling up. It is the clearest sign that our new trading relationship with Europe is not working for small businesses or the people they employ. 

“Today’s evidence will help us form urgent recommendations on how the government can begin to repair the damage from their bare-bones trade deal with the EU.” 
 

Naomi Smith, Chief Executive of Best for Britain said,

“This powerful testimony from SMEs shows that the TCA is not equipped to deal with the complexity of modern trade and is in urgent need of improvement.

“SMEs account for three fifths of the employment and around half of turnover in the UK private sector and that they have not received sufficient clarity or support is unacceptable.”

ENDS

Notes to Editors

If would like to request an interview with one of the UK Trade and Business Commissioners,  contact Niall McGourty by emailing niall@bestforbritain.org 

Today’s evidence session can be watched again here. A full transcript will be published in due course.

The UK Trade and Business Commission brings together eleven MPs from nine different parties and all four nations of the UK, along with business leaders and experts. It is co-convened by Hilary Benn MP and the Chairman of Virgin Group Peter Norris and the secretariat is provided by the cross-party group Best for Britain. The commission is taking written and holding regular oral evidence sessions with expert witnesses, businesses and the public, hearing from a range of voices representing the different sectors of the UK economy. This evidence will be used to make regular recommendations to the Government outlining how the UK's trade performance can be improved, both through new and amended trade deals.
 

A full list of witnesses at today’s evidence session can be found below.

Session One - Individual businesses (10am-11am)

• Kenneth McCartney, Managing Director, Verder Ltd, Industrial pump manufacturer and distributor from Castleford, Yorkshire

• Lee Jones, Managing Director, Fluorochem, Chemicals supplier from High Peak, Derbyshire

• David Thomas, Founder, Jin Talog, Organic gin producer from Carmarthenshire, Wales

• Alan Mitchell, Founder and Company Director of Foxglide, Sportswear manufacturer from Ayrshire, Scotland

• Lyle Pyper, Managing Director, EA Martin & Sons Ltd, Hand tools wholesaler, Coleraine, Northern Ireland

Session Two - Trade experts from representative bodies (11am-12pm)

• James Sibley, Head of International Affairs, Federation of Small Businessess

• Suren Thiru, Head of Economics, British Chambers of Commerce

• Russell Antram, Head of EU Negotiations, Confederation of British Industry

About Best for Britain: Best for Britain is a pro-internationalist campaign group that strives for the best social, economic, environmental, and democratic outcomes for the British people. We believe this requires re-engagement with Europe, open, internationalist policies, and cooperation with business, all parties in parliament, and like-minded groups