A senior member of professional body for accountants is pushing for Britain’s European Union referendum to be brought forward as soon as possible because the uncertainty over whether the UK will stay within the bloc is damaging business and investments.
Stephen Ibbotson, director of business at ICAEW, which represents 142,000 chartered accountants globally, said to BBC’s Radio 4 programme:
“There is a degree of uncertainty now, which is affecting both the UK companies [and] potential inward investment by overseas companies, so let’s get this over with, and let’s have some certainty.”
The Conservatives won Thursday’s General Election with a 12-seat majority. The Tories will have to deliver a referendum by 2017 over whether Britain will stay part of the EU, as it was a linchpin pledge during the campaign.
The Conservatives are under pressure to hold an EU referendum, which will ask whether Britain should leave the EU with a “yes” or “no” answer, amid growing disdain for the 28-member bloc’s influence over the UK.
In an ING analyst note this month, the group highlighted how the latest Eurobarometer public opinion survey showed just 23% of Britons had a “generally positive” view of the EU, with only Greece having a lower rating (22%).
However, ICAEW’s Ibbotson said 70% of the accountancy body want to stay in the EU so he didn’t expect Britain to leave the 28-member bloc any time soon.
The ICAEW’s concerns fall in line with those of ING Senior Economist James Knightley. He said in the research note that due to the uncertainty that the referendum brings in the interim, it will cause projects and investments to be put on hold until there is a clear result.
“The clear risk is that this could unsettle businesses and households. As we saw with last year’s Scottish Independence vote (September 18), foreign investors may take fright with UK asset prices and sterling likely to come under downward pressure. The economy may well lose some momentum and the BoE may raise interest rates more cautiously,” said ING.