Speech to MPs on Brexit
Dr Laura Cohen, Chief Executive, British Ceramic Confederation
Speech to MPs on Brexit, 12th February 2019.
Check Against Delivery
I represent a thriving UK ceramic manufacturing sector growing out of recession at 9% per year with rising exports. Members employ over 20,000 people. They include Stoke potters, large listed brick manufacturers, refractory and technical ceramics members who are a vital part of the supply chain for many industries including oil & gas, defence, automotive and aerospace. Three quarters of our member companies are SMEs. There’s a strong cluster in Staffordshire. And a growing UK supply chain. And it’s good to see so many MPs here tonight who actively represent our members in their constituencies.
What would no deal mean and how is uncertainty affecting us now? This isn’t project fear. I’m not talking as an ideologue. I’m a practical realist who’s worked in manufacturing for 30 years. This is what’s bothering my members:
• Firstly Customs. The National Audit Office says leaving the EU without a deal will increase the number of import and export declarations from 55 million to an eye-watering 260 million per year. They’re worried the unproven new Customs Declaration Service computer system won’t be fully ready on 29th March. We could struggle to get critical raw materials to factories and products to customers.
• Secondly Cash and Investments. No deal fears means cash is tied up in stocks of raw materials and finished goods…. instead of more productive investment to grow our businesses.
• Thirdly lack of Confidence. No deal will lead to crashing consumer confidence and market turmoil. Our members supply many sectors. They’ve already lost some EU customers. A fortnight ago one of our larger members went into administration – Brexit uncertainty hasn’t helped.
• Fourthly Tariffs. Staffordshire pottery will have an extra 12% import tariff into the EU, making it more expensive and eroding margins. And some of our biggest non-EU markets like South Korea (3rd largest export market), Japan (4th largest), Switzerland (6th largest) and Canada (8th largest) and currently have EU Free Trade Agreements. With no deal most will be lost at least temporarily. We’ll lose customers. Many jobs will suddenly become less viable.
And there’s the spectre of whether the UK choose zero tariffs for all imports. We took a strong stand against this. Two concerns: it gives a leg up to foreign competitors, swamping our home market and threatening British manufacturing jobs. It also weakens the UK’s hand making free trade deals: if we give away access to Britain for free, why would anyone need to do a trade deal with us?
• Fifthly Dumping. Chinese ceramics manufacturers don’t play by the rules. They dump product here. UK tile and tableware manufacturers rely on EU measures for a level playing field. Maintaining these will be much more difficult with no deal than with a transition. The new UK system isn’t yet legally established. And the rules aren’t agreed, even if, it means, unfortunately, just nodding them through parliament via statutory instrument. This is not voting leave and taking back control.
So we desperately need MPs to work on a Parliamentary consensus to avoid no deal, ensure a smooth transition and minimise disruption. Caroline Spelman’s amendment makes this, in her words, morally binding. We need MPs to put the country’s interests before those of their parties.