What did we learn from the ABI Brexit conference?

Anniversaries are a good time to reflect and move forward. One year on from the EU referendum we decided to hold a Brexit conference to do just that. The conference was an opportunity to cut through some of the uncertainty and focus on what matters in the Brexit negotiations for our customers and our industry. Here are 5 things that I took away from the day…

Leaving the EU without a deal is not acceptable. This message came through clearly throughout the day. As insurers we want to continue to meet the needs of millions of customers across the EU and to do this our industry needs to ensure full compliance with the law. Government therefore has to deliver an orderly withdrawal, stable transition and sensible and mutually beneficial trading relationship with the EU. In his first speech as Economic Secretary to the Treasury, Stephen Barclay MP spoke about making an early agreement on transitional arrangements a priority for the Government. This is a welcome message and reinforces the tone of the Chancellor’s Mansion House speech a couple of weeks ago.

Opportunities exist for trade. The first trade deal that the UK will be working on is of course a mutual market access deal with the EU. The message we heard at our conference from a distinguished trade panel was that there are many countries who are open to free trade deals and economic dialogues with the UK. The Department of International Trade made clear that formal free trade negotiations can’t start until we leave the EU (and Customs Union), but informal discussions have already begun and the UK will be working on re-establishing itself at the World Trade Organisation. We heard that free trade deals often don’t include financial services and are difficult to negotiate, but there are a number of areas like supervisory co-operation and economic dialogues which can open up new markets for financial services companies.

To get a sensible Brexit outcome political parties are going to have to work together. This might sound like an impossible task, but as David Davis said earlier in the week, the job of Brexit Secretary is as complicated as working for NASA during the Moon landings. Through the Queen’s Speech the Government has kicked off the mammoth task of transferring EU law into UK law with eight Brexit Bills. We can also expect up to a thousand pieces of secondary legislation over the next couple of years. As a number of speakers pointed out it is clear that with a minority Government and no majority in the House of Lords, cross-party co-operation is going to be essential to make this legislative process work.

The public view on Brexit hasn’t really changed. This is what we heard from Lord Livermore, Partner at Britainthinks. The current polling is still broadly similar to the result of last year’s referendum and the public is still deeply divided. A large proportion of Leave voters are excited about the opportunities from life outside the EU whilst a similar proportion of Remain voters are still devastated by the outcome and worried about the future. Trade is seen as an important issue to all voters but very few understand or would use terms like “Single Market” or “Customs Union”.  

Don’t forget about the EU27. We were lucky enough to hear the views of a number of our sister insurance associations in the EU, including from Poland, Ireland, Netherlands, Sweden and Insurance Europe. They all expressed a sense of regret from the UK’s decision to leave the EU and that for many they see it as the loss of an important ally in future EU discussions. All participants reinforced that the EU would not seek to punish the UK for leaving, but that the Commission would stick to its negotiating mandate. The audience was reminded that the EU is a political project and that the future of the EU after Britain leaves is more important to the EU27 than Brexit.