Most British firms will delay investment and cut recruitment plans unless a Brexit transition deal is agreed early next year, company bosses have warned. The stark claim from Britain’s biggest business group comes amid the strongest signs yet that the corporate world has lost patience with cabinet infighting and lack of progress in Brexit talks.

Paul Drechsler, president of the Confederation of British Industry (CBI), said there was “exasperation” at the lack of progress, and criticised the fact that Theresa May had still not held a full cabinet discussion on the final Brexit deal. “I couldn’t believe that any team of people would take on a mission of this scale without considering it in detail in terms of the pros, cons, costs and benefits – nobody could embark on the biggest deal of their life without considering it in the boardroom,” he said.

“Every boardroom in the UK has diversity of opinion around the table. In every boardroom, we discuss our different opinions and develop an agreed set of values and come to an agreement on where we are going to go. No board member says, ‘I’m going to brief people on my own point of view, which is different.’ It doesn’t happen in the world of business, it cannot happen in our parliament any longer. We need a united parliament, government and cabinet. I don’t mean momentarily – I mean day in, day out, until the deal is done.”

Drechsler said there should be no “red lines” in the talks about the final deal, suggesting the CBI wanted to leave open the issue of single market membership. He said that any free trade deal struck with Europe would have to cover the services sector, which makes up the bulk of the UK’s economy. It means the CBI wants the agreement to go way beyond the EU’s trade deal with Canada, often cited as a possible model but which does not cover services.

Q&A What is a hard Brexit? Show Hide A hard Brexit would take Britain out of the EU’s single market and customs union and ends its obligations to respect the four freedoms, make big EU budget payments and accept the jurisdiction of the ECJ: what Brexiters mean by “taking back control” of Britain’s borders, laws and money. It would mean a return of trade tariffs, depending on what (if any) FTA was agreed. See our full Brexit phrasebook.

“If we were a Germany with 30% or 40% of the economy as goods, then perfect – but we’re not,” he said. “So a goods deal for the UK is welcome for those who trade in goods, but for the rest of the economy it does nothing.”

His intervention, before his speech to the CBI’s annual conference on Monday, heaps pressure on May to secure agreement for a two-year “standstill” transition deal at a crucial Brussels summit in December. It comes as Tory Brexiters who favour walking away from talks become more vocal.

Drechsler said a survey of CBI members showed 60% would roll out their contingency plans for crashing out of the EU by the end of March, unless a transition deal was secured soon. He warned that smaller firms might not be able to plan for the worst.

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