What does the tech industry make of the withdrawal agreement?

Written by Sam Trendall on 16 November 2018 in News

Trade association techUK has backed the proposed deal – but campaign group Tech For UK is fervently calling for a public vote

Credit: Stefan Rousseau/PA Wire/PA Images

The proposed European Union withdrawal agreement published this week has received the backing of industry body techUK, which has called on MPs to support the deal. But other prominent industry figures have criticised the trade association and are lending their weight to a campaign led by Tech For UK to encourage MPs to back a public vote offering the option of remaining in the EU.

Yesterday, techUK chief executive Julian David issued a statement claiming that “the withdrawal agreement that has been negotiated is the only solution on the table that can deliver on the outcome of the 2016 referendum whilst also securing jobs and investment in UK tech”. He urged MPs to vote in favour of the deal.

He added: “The proposed agreement would avoid the very dangerous consequences of no deal and provides a basis on which to secure a comprehensive deal on the UK’s future relationship during the implementation period. techUK particularly welcomes the clear statement of intent to secure the free flow of personal data between the UK and the EU. This issue is critical to the tech sector and to every other industry in a modern digitising economy.”

“Leaving the EU’s customs union, single market, Digital Single Market, VAT area and regulatory framework – in whole or part – will tear apart the bedrock on which our industry operates, and cause us grave harm.”
Tech For UK

Publication of the techUK statement was swiftly met with criticism online – and a rival open letter to MPs from industry campaign group Tech For UK, calling on MPs to reject the agreement and offer the public a “people’s vote” that includes an option to remain in the EU.

“It is our view that the government’s withdrawal agreement… will not serve the best interests of the UK tech industry,” it said. “It will vastly increase friction in trade with the EU and impose significant and costly changes for the tech industry.”

Tech For UK was set up earlier this year by a collective of 80-plus industry executives with the purpose of lobbying for a public vote on the terms of the UK’s exit from the EU. Among those supporting its call for another ballot are two Whitehall digital heavyweights: former government digital champion Martha Lane Fox; and ex-GDS boss Stephen Foreshew-Cain.

In response to the critical response to techUK’s position, CEO David today issued a follow-up statement to provide additional background to the organisation’s decision to back the withdrawal agreement. He particularly addressed a complaint made by numerous people on Twitter that the trade body should not suppose it can speak on behalf of the UK tech industry as a whole.

techUK is a business organisation that represents companies rather than individuals that work in the technology sector,” he said. “We speak on behalf of those members – hundreds of companies large and small employing hundreds of thousands of people across the UK.”

David added: “Digital tech companies number many thousands in UK. They are not all techUK members, so clearly we do not represent everybody in tech but, given the spread of our members from chip design and electronics, satellite and telecoms through to health tech and AI solutions providers, we have a very broad base. We work with our members on a daily basis and our positions are developed through a system of groups and committees, including a Brexit policy group that is open to all members. Major decisions such as techUK’s approach to Brexit are agreed at board level.”

The techUK CEO said that the organisation had – following research of its members – supported remain in the 2016 referendum.

“We have never taken the view that leaving the EU was preferable to remaining a member, but we have engaged in the political process to try and mitigate the impact of Brexit on the ability of tech firms to do business,” he said.

“We recognise the agreement is not perfect and it is also not in itself a future trade agreement with the EU, but it does contain a number of positions and proposals that can build to one.”
techUK CEO Julian David

David added that leaving the EU without a deal “is a potential catastrophe” for techUK’s members. Supporting the withdrawal proposal could avoid such a terrible outcome, he said.

He said: “We recognise the agreement is not perfect and it is also not in itself a future trade agreement with the EU, but it does contain a number of positions and proposals that can build to one. It is also the only proposal that is currently on the table. We have said that if that changes then we will, in consultation with our members, determine what is the best position for us to take to continue to support jobs and investment in digital technology businesses in the UK.”

The Tech For UK letter, meanwhile, said that – deal or no deal – “Brexit is a dire threat to the UK tech industry”.

“Leaving the EU’s customs union, single market, Digital Single Market, VAT area and regulatory framework – in whole or part – will tear apart the bedrock on which our industry operates and cause us grave harm. Brexit is already causing serious uncertainty, raising costs and threatening future red tape. Post-Brexit, our products and companies face the real risk of becoming hard to create, fund and distribute globally, especially in the vast market of the EU. Anecdotally, we know many of the innovative start-ups of the future are looking to other EU cities to relocate to, or simply bypassing the UK altogether.”

It added: “Now that we know what the Brexit options look like, it is critical to find a way out of this mess. We therefore ask [MPs] to support a final say on Brexit with a 'People’s Vote’ referendum – with the option to remain in the EU – to allow our industry, our customers, and the country a say on the final Brexit outcome.”

About the author

Sam Trendall is editor of PublicTechnology

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