CEO of Copronet discusses Brexit: “The greatest risk for SMEs would be doing nothing”

6 April 2016

Brexit British and EU flags

I was recently asked to do an interview to explain why I believe that the UK would be better off leaving the European Union. At the outset, I acknowledged that people are fundamentally conservative – that is to say, they don’t like change. Change can be daunting or even frightening, and for that reason many often choose to do nothing, in the hope that their status quo won’t be upset.

If I am honest, I personally find change intimidating. However, as an entrepreneur and founder of an SME, I recognise that from change and uncertainty opportunities arise and innovations are born. Working in construction, I believe that the ‘remain’ camp is too tightly focused on supporting doing nothing – and that doing nothing by voting to remain within the EU poses the greater risk. Here’s why…

It is extremely unlikely that a thriving industry within an economy that pays the market wage or above will ever struggle to source appropriately skilled labour, whether that is from Europe or further afield such as India or Canada. Nor do I believe that our current trading partners will cut off their noses to spite their face by deciding unilaterally not to sell goods to an economy and a sector that is a massive net importer of goods.

However, I do believe that our economy and SMEs in particular, would reap the benefits of being unfettered from stifling bureaucracy imposed from Brussels.

My new business venture, – which is already gaining traction – shares many of the same ideals as the draughtsmen of the Treaty of Rome (cooperation, collaboration, transparency and a level playing field). In reality the latter has not enabled healthy competition and has in fact stifled it.

The complex, unwieldy, extensive and expensive requirements of the OJEU procedures have restricted competition. Many businesses – especially smaller ones – have been deterred from entering into pre-qualification tendering processes that they possibly don’t understand but certainly can’t afford to invest scarce resources into. The end result is that the body procuring a contract suffers delays and increased cost, while the most potentially competitive businesses and service providers are not encouraged to challenge the existing status quo that exists. These smaller businesses are the engine not only of our economy, but that of the entire EU.

Clearly this situation benefits no one. Prices remain high. Costs are wasted. Larger companies, with the administrative resource to jump through hoops, are left free to preserve their stranglehold on larger contracts.

The fundamental tenets that broke the global economy back in 2008 still remain. We may well have been handed a stay of execution through a range of fiscal measures such as quantitative easing; and indeed this has played a part in the construction boom that we have all been enjoying for the last three years. But one day the music in this game of financial musical chairs will stop.

When it does, if we are still in the EU, we may find ourselves with fewer places to sit (or export to) than we might expect. Whilst we have ostensibly been exempted from paying for future Eurozone bailouts, that is of limited benefit if the European nations that we have contractually committed to selling goods to haven’t got any money left to buy them.

We are a resourceful nation, with one of the most encouraging and favourable environments for start-ups in the world. We have much to offer, but we need the ability to expand our trading horizons – just as we have done throughout history. We will still do business with our neighbours. Indeed, a vote in favour of leaving the European Union may well trigger a rapid negotiation of a far more favourable deal. But if we stay – the construction industry’s future is in the hands of others over whom we have very little control.

David Stapleton, Chief Executive Officer 

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