Thames Valley: No-deal Brexit ‘bigger risk than coronavirus’

Despite the ongoing impacts of coronavirus and changing lockdown restrictions, 50% of businesses in Thames Valley think a no-deal Brexit poses a bigger threat to the UK economy, compared to 33% which think a second domestic wave of COVID-19 presents more of a national economic risk.

According to the monthly Rethinking the Economy survey conducted by accountancy and business advisory firm BDO LLP, 37% of companies in Thames Valley are still making changes to how they work in response to COVID-19, while 20% are focused on keeping their businesses running safely in the new climate.

The poll of 500 mid-sized businesses also revealed that it will take the majority (60%) of Thames Valley businesses between one to three years to clear debts incurred because of COVID-19. It will take a fifth of the region’s companies more than three years to repay coronavirus debts.

Commenting on the findings, Glyn Woodhouse, head of Brexit Indirect Tax at BDO in Thames Valley, said: “Businesses throughout the region have shown great resilience during the pandemic and continue to work hard to tackle the ever-changing disruption of COVID-19. Regardless of these challenges and ongoing uncertainty, more businesses think a no-deal Brexit presents a bigger risk to the UK economy than a second domestic wave of coronavirus.

“International trade is of huge importance to companies right across the region and they want reassurance about the feasibility and practicalities of cross-border trading once Britain has completed its transition out of the EU.”

UK Government has set a deadline of October 15 to conclude any free trade deal with the EU before Britain completes its exit from the European Union at the end of the year.

The Rethinking the Economy survey also showed that almost nine out of ten companies in the region have adapted employment terms for up to 15% of their workforces in response to COVID-19.

Woodhouse concluded: “Our research shows Thames Valley businesses have been working to change employment terms by reducing hours and introducing job shares to protect jobs. Unfortunately, some job losses will still occur, but businesses remain optimistic about recovery in the long-term. Around half (47%) of the region’s companies expect to increase the size of their workforces by between 50% to 100% in the next year.”