May 23, 2014 - Rachel Miller
As voters across Britain and Europe go to the polls this week, the latest EU Business Barometer from the British Chambers of Commerce (BCC) shows that UK businesses are more uncertain over the future of the UK's relationship with the European Union.
In the first quarter of 2014, the BCC asked businesses how various possible scenarios in Europe could affect their company. Asked about the prospect of Britain retaining membership of the EU and transferring specific powers back from Brussels, 19% of respondents said they "didn't know" how this could impact on the UK – up from 10.7% in Q1 2013, an increase of almost 80%.
More than half of businesses (54%) said this scenario would be positive for the UK, although this figure has decreased over the past 12 months (from 64% in Q1 2013).
In addition, 61% of firms said that a scenario resulting in Britain's withdrawal from the European Union would have a negative impact on their future prospects. Only 12% of firms view this scenario as a positive, the lowest number on record.
John Longworth, BCC director general, said: "In the space of a year, business opinion on a renegotiated relationship with Europe has started to cool. The on-going recovery, coupled with less frantic media headlines around the state of the eurozone over the last 12 months, could mean that businesses are less concerned about the UK's relationship with the EU compared with a year ago. We also know from our own data that businesses have become less reliant on trading with the EU, and are increasingly exporting to countries outside the eurozone."
Also this week, a new survey of 500 SMEs by Sage One has found that 25% of SMEs believe leaving the EU will have a negative impact on their business. However, only four in ten have considered the implications of Britain's potential exit of the EU in their long-term business forecasts. And 66% think Britain's membership of the EU is unlikely to impact their performance.
Meanwhile, research by the Institute of Directors (IoD), has found that over 60% of IoD members say their support for continued EU membership is conditional on successful reform in key areas. It found that 31% would vote to remain a member in all circumstances, while 6% say they would vote to leave whatever happens. However, just 11% of respondents agreed that "the EU currently presents a viable socio-economic model".
Simon Walker, director general of the IoD, said: "We want to see a discussion now about how the EU needs to change, not an all-consuming debate on 'in v out'."