Four in 10 UK businesses believe a Brexit transition period would enable them to move ahead with investment and recruitment decisions that were put on hold after the referendum, according to a new survey.
Some 21 per cent of companies believe a transition agreement needs to be in place by the end of the year, and a further 22 per cent said the deadline should be June next year.
The government has already set out its plans to secure a transitional customs agreement with the EU. The City is anxious for Brexit secretary David Davis to make a similar pledge for the financial services industry.
Of those surveyed, 54 per cent said they had been forced to put investment or recruitment on hold or faced reduced demand from customers after last June’s EU referendum.
The findings are based on a YouGov survey of more than 1,000 companies which have annual turnovers of above £1m for Lloyds Banking Group and London First.
The research also found that bigger companies are more concerned about securing a transition deal. Nearly half (47 per cent) with revenues of more than £750m said it would help their business, compared with 35 per cent among small and medium-sized enterprises (SMEs).
The study also found that 18 per cent of all respondents said a transition period would have a negative impact on their business, while 35 per cent said it would have no impact.
“The findings of the survey reinforce what we already know from conversations with many of our business, corporate and institutional clients,” said Edward Thurman, head of financial institutions at Lloyds Bank Commercial Banking.
“Many firms feel a transition period would help them to prepare for Brexit, and the sooner the UK and EU27 agree terms, the less uncertainty for businesses there will be.”
London First chief executive Jasmine Whitbread said: “It’s clear that a transition period is better for business than ‘no deal’. But to encourage continued economic growth and secure jobs, the government must act now on a transitional agreement while setting out what the UK’s long-term future will look like. Companies need to be able to see ahead to invest in and hire for the future, we can’t afford to wait much longer.”