State’s preparations for Brexit incredibly lacking, warns Ibec

The Government’s preparation for a scenario where Britain leaves the European Union is “incredibly lacking”, Ibec chief executive Danny McCoy has warned.

Speaking on Wednesday's The Irish Times Business Podcast, McCoy said if Britain leaves the EU "the question will be will we want to remain in that group or go in the group that has more flexibility".

“Britain will have flexibility if they’re out. They will not be subject to state aid rules. Already today a lot of medium-sized Irish businesses are being encouraged to set up in Britain, ” he said.

Mr McCoy also said that concessions won by Britain in negotiations over their EU membership could “give them the edge competitively against Ireland”.

“We’re not even talk about that. And that’s going to occur in the negotiations between now and the referendum,” he said.

Also speaking on the podcast, CityJet commercial director Pat Byrne agreed with Mr McCoy that Ireland is unprepared for Brexit.

“We would be in an appallingly difficult and challenging situation and is very difficult to know what the right course of action would be for this country. But I think it is a mega-serious issue, I don’t think it’s getting enough consideration in Ireland at all,” said Mr Byrne.

FBD Insurance chief executive Fiona Muldoon said the effect of Brexit on the agribusiness sector would be “very profound”.

“Up to 70-80 per cent of our business is farming or agribusiness related,” said Ms Muldoon. “So we try to think that through. It’s not immediately obvious. We’re very attuned to the downturn in our customers’ fortunes that might fall out from a Brexit. But it would be a second order effect for FBD itself”.

Ms Muldoon said she expected further double-digit increases in car insurance premiums in 2016, following percentage increases in the “high teens early twenties” range in 2015.

“When you see an uptick in the economy, there’s more people back on the roads, there’s more people in hotels and restaurants, there’s more people back at work. All of these things lead to an increased frequency in claims,” said Ms Muldoon.

To listen to the podcast go to www.irishtimes.com/business/business-podcast