Cost is king

“This survey shows that uncertainty over Brexit is driving a marked shift towards defensive balance sheet strategies among British businesses. With the UK’s growth prospects heavily dependent on the so far uncertain nature of its exit from the EU, corporates are cutting back on plans for capital expenditure and hiring, focusing instead on cost reduction.

“Corporates are positioned for the hardest of Brexits, with risk appetite at recessionary levels and an intense focus on cost control. Businesses seem to be increasingly pricing in a worst-case outcome. Anything better, including a delay or a deal, could deliver a Brexit bounce in sentiment.”

Ian Stewart, chief economist at Deloitte

“This survey shows a definite ‘hunkering down’ mentality across the UK’s CFO community, highlighted by the focus on cost control, a pause on hiring and low appetite for risk.

“Given the ongoing Brexit uncertainty, this attitude is understandable and demonstrates that business urgently needs clarity about the UK’s future relationship with the EU. Unless a favourable deal is agreed, it seems likely that this current lack of appetite for investment or recruitment will continue.”

David Sproul, senior partner and chief executive of Deloitte North West Europe