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Northern Powerhouse

Brexit weekly digest 1 May

After the Easter break, the Commons has now reconvened, and the Brexit negotiations continue. The Prime Minister is still committed to having a deal agreed before the EU Elections deadline, but momentum of the negotiations has slowed.

Businesses are still imploring the government for a settled agreement, but in the meantime, economic indicators suggest that the effects of Brexit may be starting to show. 

Andrew Sentance, a former member of the central bank’s interest rate-setting monetary policy committee (MPC), said: “The UK economy will be limping on for a while, until Brexit negotiations are fully resolved. I can see the UK being in this limbo-land for quite a while – certainly until the late 2020s.” 

The number of UK businesses in “critical” financial distress jumped 17 per cent over the year to the end of March, with a significant deterioration seen in the first quarter of 2019 as Brexit uncertainty deepened.  Research by insolvency firm Begbies Traynor found that almost half a million businesses

 – one in seven of all UK companies – were in significant financial distress in the first three months of 2019. 

British car production fell for the 10th consecutive month, tumbling by 14.4% in March, according to figures released by the Society of Motor Manufacturers and Traders (SMMT). The major trade association said that production for both home and overseas markets crashed by double digits, down by 18.1% and 13.4% respectively. The group warned about the impact Brexit uncertainty is having on car production already and said the worst-case scenario—Britain leaving the EU without a deal—could send the industry back to the “dark days” of the 1980s. 

For a review of the extension of Article 50, the Institute of Government reviews the process here

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