Last week’s ‘out’ vote was the biggest political event for a generation. Chris Losh takes a look at what it means for the country and the on-trade
I’ve been asleep for the last week, what just happened?
After 40 years of low-level grumbling, the UK voted to leave the EU.
Oh. How did that happen?
A lacklustre ‘remain’ campaign, some questionable promises from the Brexiters, and an unholy alliance of the disenfranchised poor and wealthy pensioners.
And will leaving address any of their concerns?
Not remotely. Unless, of course, they think that being poorer will make things better.
So economically this is not a good thing, then?
Er, no. The stockmarket is at its lowest point for years, the pound has tumbled against both the dollar and the euro, and business is holding back on investments until we know what the hell’s going on. However it plays out we can probably expect a longer and more severe period of austerity.
Sounds like the country will be poorer as a result.
Yes. It’s too early to be definitive, but experts warned this would not play out well, and they seem to be being proven right.
And I’m guessing a poorer country will mean less business.
Well, yes and no. On the plus side, a weaker pound might well mean more tourists. On the minus side, most Brits will have less money in their pocket and everything imported in ruros and dollars will be more expensive.
So that’s, like, most booze…
Sadly, yes. Expect price rises of 10-20% in the next year.
Still, at least we’ll get our borders back.
Well, we might. The trouble is that if we still want unfettered access to the single market, we will almost certainly have to accept freedom of movement. The EU is showing no signs of giving ground on that.
But immigration was the big issue wasn’t it?
Correct, which means that no government, surely, will be able to accept any sort of deal where our borders are still open to anyone from the EU who wants to work here. And if we refuse to accept free movement, that means we don’t get into the single market.
Which means what?
Import and export tariffs, probably.
It might be. In truth, the sums involved aren’t likely to be massive – it’s just an extra hassle, and even small extra costs add up. Some areas might get off scot-free. The whole thing will have to be negotiated on an industry-by-industry basis, which could take quite a while. In any case, whatever we’re left with, it won’t be as cheap and hassle-free as what we’ve had for the last 40 years.
How about cutting red tape?
There might be benefits for the on-trade here. Brussels has imposed stringent regulations on staff rights, health and safety, food preparation and storage, etc. The UK might still elect to keep some of these, but other laws could go, which might make life easier, particularly for small businesses. Either way, British politicians, not European ones will be in control of those decisions.
I’ve heard we could cut VAT on hospitality.
Yes, we could. But that was always possible within the EU. Indeed, loads of EU countries cut their VAT rate on hospitality. The decision to keep it high was a UK one – so it’s hard to see it changing. Especially with a big hole in the public finances.
How about EU workers? Can they still come here?
It all depends on what gets agreed with the EU. If we follow the ‘Norway model’ of joining the European Economic Area, that will almost certainly come with freedom of movement as a pre-requisite. If we want something more stringent – like a points-based system – that would almost certainly come with negatives for business.
And ‘foreign’ staff already working in the UK…?
Should be fine. It’s unlikely that any government would attempt to forcibly repatriate anyone who is already here. In any case, nothing will change for the next two years, which is how long it takes for the country to leave, once it invokes Article 50 of the Lisbon Treaty.
Forgive me, but it all sounds like a bit of a muddle.
It is. Total chaos. All we can do at the moment is cross our fingers and hope that we get a decent deal out of the Europeans.
So we’re relying on the French and Germans to do us a favour?
Do you think that’s likely?
No. There are growing nationalist groups across the continent, and we appear to have achieved the impossible and made them hate us even more now.