British Fashion Council opposes "no deal" Brexit
The British Fashion Council (BFC) has spoken out against the possibility of a no deal Brexit stating that is "a scenario that should be avoided" and that a switch to trading on WTO (World Trade Association) rules could cost the industry between £850 million and £900 million.
The council said its main concerns for a no deal Brexit, which has become increasingly likely since the appointment of Boris Johnson as Prime Minister by members of the Conservative party, centred on frictionless trade and the movement of talent.
“Fashion SMEs are international from day one, with first sales often taking place outside of the UK,” the British Fashion Council said. “Driven by the need to achieve high artistry and creative pieces, designers adopt a global approach in all elements of their business; from sourcing the perfect fabric, through to finding the best pattern cutter in the world to work with that fabric.
“Fashion is component goods which traverse borders multiple times before becoming a finished product, and in order to sell, samples are taken during the selling season to a variety of international markets and shows. This adds a level of complexity not dissimilar to other component goods industries such as the automotive industry.”
Falling back on WTO rules would introduce additional costs, bureaucracy and complicate logistics, as well as introduce the need to claim VAT across 27 member states rather than via the EU as a whole.
On talent the BFC said the proposed new rules around exceptional talent and the requirement to earn £30,000 or more would leave the industry, which contributes £32 billion to the economy, with a vital skills shortage.
“[The new rules] would not cover skilled, lower paid workers from machinists, to language experts, leaving concerns about skills gaps for the industry.”
It added that: "[...] of particular concern is the recommendation that the Tier 2 visa has a £30,000 minimum threshold on salary, with skilled roles in fashion manufacturing typically earning less than this. Similarly, the shortage occupation list does not cover any roles required by the high-end fashion industry. The BFC asks that the salary threshold and shortage occupation list are reviewed as a matter of urgency.”
Last week Cecile Reinaud the founder of British-based maternity brand Seraphine hit out at the idea of a no deal Brexit saying it would damage the international expansion plans of SMEs.
“A no-deal Brexit shows no consideration for growth businesses such as ours, successful exporters flying the flag across the world, who will be the first to suffer from border chaos and talent flight," Reinaud said.
“The Government is making up policy on the hoof. No-deal is the perfect way to ensure UK SMEs lose their global standing," she added.
Boris Johnson is currently playing hard ball with so-called "rebel" Conservative MPs who are attempting to block no deal. Johnson has threatened to remove the whip from MPs who do not sign up to the Government's position that a no deal becomes the default position should a deal not be agreed in the interim.