Brexit chaos currently envelopes Parliament. MPs can’t decide on what to do next and the gridlock means businesses and households face uncertainty going into 2019 rather than the optimism of a new year.
In the Westminster bubble, the hurricane of plotting and bickering is theatre - entertainment to be enjoyed and debated while they go on with their daily lives in much the same way as they had done before 2016. But outside the Westminster bubble, trouble has been simmering for a while.
Today’s announcement that Jaguar Land Rover, one of the country’s biggest exporters, plans to cut up to 5,000 of its 40,000 jobs could be the tipping point. With the company only recently having announced it will be moving all production of the Land Rover Discovery to a new plant in Slovakia, today’s news that nearly one in every eight jobs in the UK will be cut is a disaster for UK manufacturing and, in particular, the automotive sector – the jewel in the crown of our industrial might.
Jaguar Land Rover is the Brexit canary in the coal mine and this news should worry everyone. For those of us who have been following the twists and turns of Brexit over the past three years, this news sadly doesn’t come as a surprise. Indeed, the writing has been on the wall for a while. Jaguar Land Rover said last year that a hard Brexit would cost it £1.2billion a year.
Most of today’s job losses are likely to be in management, marketing, sales and design roles, rather than on the production lines. But each of these roles will have a ripple effect down the supply chain and will be felt by businesses throughout the Midlands and the wider region. Make no mistake: the shop on the high street will feel the effects of today’s news as the spending power of those who have lost their jobs reduces.
And this is indicative of the wider Brexit pain felt by British industry? I am afraid it is. Airbus, Ford, Vauxhall and BMW are among a whole host of companies to announce production cuts in the UK due to Brexit, while the business group London First recently made their concerns clear about the Prime Minister’s deal. Businesses tell me that they are facing major challenges and are worried about what might happen. They don’t have certainty and think they need to invoke emergency procedures for the impending Brexit disaster.
With this in mind, I personally agree with London First’s view that the UK must now rescind its request to leave the European Union, which was made under Article 50, if Theresa May’s deal is rejected by the House of Commons next week. Not doing so would be extremely irresponsible. I have been baffled by the lack of willingness on the part of Theresa May over the last few months to take account of the views of others and try to find a consensus on this matter, rather than rush her Brexit deal over the line. In the extremely likely event that it proves impossible to form a Parliamentary consensus, the Government must legislate to put this decision back in the hands of the public and give them the final say.
Theresa May has used the threat of a no deal Brexit to try and scare MPs into backing her deal. It is horrifying to see the Government playing with businesses and the economy in a high stakes game of poker with little awareness seeming of the disastrous consequences if we crash out of the EU.
Today’s announcement from Jaguar Land Rover is a disaster for the Midlands and the UK and it should be a huge wake up call for Theresa May and her cabinet. If they don’t take heed, this will be the first of a number of devastating announcements for car industry and UK manufacturing.
Nicola Horlick is an investment fund manager and CEO of Money&Co
