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Advisers and clients feel paralysed by Brexit

With Nigel Farage and Jeremy Corbyn in last place for votes if a general election was held tomorrow

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A staggering 60% of clients and financial advisers are holding off making plans to see what will change in the UK political climate, even if it means missing out on opportunities or acting too late, according to Withers.

The law firm polled a group of more than 70 advisers and clients in a seminar discussing planning for a Labour government.

They were asked, in the current climate of political uncertainty and in the context of planning, what is it that they intend to do?

One-in-five (18%) said they would leave the UK while they still can.

A similar proportion (17%) said they would “do a lot”, but there was no indication of what actually entails.

Just 5% said they would do nothing.

Degree of paralysis

Chris Groves, partner in the Withers private client and tax team, said: “Whilst the numbers planning to make active changes or to leave the UK were not insignificant, the fact that 60% would continue to monitor events, even to the point of being too late to act, appears to show that many people still don’t know what to do in our current circumstances.”

Political affiliations

Prime minister Boris Johnson’s attempts to force a general election have been foiled but, if the Withers poll is anything to go by, he would likely not be very happy with the result.

If a general election was held tomorrow, 41% would vote for him.

This puts the Conservatives in second place behind Jo Swinson and the Liberal Democrats who would take 48% of the vote.

Labour’s Jeremy Corbyn and the Brexit Party’s Nigel Farage would get 0% each.

The remaining votes would (strangely) go to former Labour prime minister Gordon Brown (7%), Scotland’s first minister Nicola Sturgeon (2%) and the Monster Raving Loony Party’s Screaming Lord Sutch (2%), who died in 1999.

This is perhaps the most glaring indicator of how sick and tired the British public is of politics in general.

“It is certainly interesting to see our audience was slightly in favour of voting for the Liberal Democrats, perhaps reflecting the City’s concerns about the impact of leaving the EU at all, let alone without a deal,” Groves added.

Change of address?

Despite favouring a Lib Dem candidate, the clients and advisers attending the Withers seminar still expect that those sending a Christmas card to Johnson will still be able to address it to 10 Downing Street.

None of them believe that Farage should be arranging a moving van any time soon.

Just 6% think that Jeremy Corbyn will be hosting a Christmas party in Downing Street this year, whereas the shadow secretary of state for exiting the EU, Keir Starmer, may be a bit of a dark horse having received 11% of the vote.

“These results pretty neatly reflect where the UK at large stands right now, in terms of a division between the remain and leave movements, a strong expectation that the status quo will ensure until at least the end of 2019, and an equally strong degree of paralysis regarding preparations,” Groves said.

Underlying message

While many will argue with the results of the Withers poll and strive to poke holes in its conclusions – the starkest message is that people are lacking information and direction.

Yes, it is ‘easy’ to sit in a seminar and say that you will leave the UK while you still can – but the fact that a fifth of those present did so is a strong indication that something is rotten in the state of Britain.

Financial advisers, wealth managers and anyone in the financial services sector tasked with helping people save, invest, grow their wealth and plan for their retirement are all doing so in an environment that nobody has experienced before.

That 60% are adopting a ‘wait-and-see’ approach is entirely understandable.

Hopefully it will mean a softening of downside risk and not missing out on any upswing.

But only time will tell.

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