CBI calls for fresh start following PM's departure call

Carolyn Fairbairn, director-general of the Confederation of British industry (CBI) has called for a clear plan for delivering Brexit and delivering future prosperity for the UK.

Her comments came after prime minister Theresa May gave an emotional statement in Downing Street outlining her departure from office in two weeks time.

Fairbairn said: “The Prime Minister could not have worked harder to deliver a Brexit deal that protects the economy. She leaves office with the respect of business.

“But her resignation must be now be a catalyst for change. There can be no plan for Britain without a plan for Brexit. Winner takes all politics is not working. Jobs and livelihoods are at stake.

“Business and the country need honesty. Nation must be put ahead of party, prosperity ahead of politics. Compromise and consensus must refind their voice in Parliament.

“We call on politicians from all parties, on all those ambitious to lead, to take this chance for a fresh start.”

The statement followed an update showing retail sales in the year to May fell fell at the fastest pace since October 2017, according to the latest quarterly Distributive Trades Survey.

The survey of 90 firms, of which 42 were retailers, also showed that the volume of sales for the time of year were at their poorest since March 2009, but are expected to be broadly in line with seasonal norms next month. Orders placed on suppliers in the year to May also fell, at their fastest pace in 19 months.

Conditions for retailers have further deteriorated with investment intentions for the year ahead reaching their lowest in survey history (since 1983), said the CBI.

Employment also fell on a year ago, for the tenth quarter running and at the fastest pace since August 2009.Overall, respondents expect business conditions to remain broadly stable over the next three months, matching expectations in February, it added.

“The only sub-sector which posted a rise in sales this month was non-store retailing. Recreational goods sales volumes were flat, whilst the other sub-sectors contracted.

“Growth in annual internet sales grew at a slightly faster pace in May, albeit at a rate still below the long-run average. Retailers expect similar growth in internet sales in the year June.

“Elsewhere, wholesalers reported a fall in sales for the first time in almost three years. Motor trades also saw the sharpest decrease in sales volumes since December 2011, and are expecting a further decrease in June.

“While the economy as a whole saw a strong start to 2019, this was at least in part due to pre-Brexit stockpiling. Business surveys indicate that underlying conditions are more subdued,” said the CBI.

Anna Leach, CBI deputy chief economist, said: “This month’s survey paints a dismal picture of business conditions for retailers, who face a grim combination of tough trading conditions, Brexit uncertainty and a burdensome outdated business rates regime, which have collectively pushed investment intentions to a record low.

“Parliament has one more chance to bring a Brexit deal forward and finally resolve this gridlock. Politicians must lock down a deal as soon as possible, whether through indicative votes or the Withdrawal Agreement. Business and the country need an urgent resolution to this mess.”

Among key findings were that 26% of respondents reported that sales volumes were up on a year ago in May, while 53% said they were down, giving a balance of -27

Retailers expect sales volumes to pick up next month (+7%), with 26% expecting a rise and 19% expecting a fall. Sales for the time of year were at their poorest since March 2009, with a balance of -40%.

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