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News & Press: International Trade News

The UK's businesses and customs systems are not ready for Brexit

09 April 2019  
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brexit preparations

Businesses and the UK’s customs systems are not ready for Brexit – according to Stephen Phipson, CEO of Make UK (the manufacturers' organisation previously known as EEF), and Patrick MacSwiney, chair of the Brexit committee at the Joint Customs Consultative Committee (JCCC).

In a letter to the government on Sunday, Mr Phipson wrote that the majority of manufacturers comprising the membership of MakeUK have called for an end to the uncertainty around Brexit. He calls for the revoking of Article 50 should a deal not be passed by Parliament this week. He wrote:

“The manufacturing sector would strongly support an agreement which took the foundations of the existing Withdrawal Agreement and Political Declaration but built on them with a strong and definitive position on our future relationship with the EU that guaranteed these outcomes. However, the majority of our members have told us, in no uncertain terms, that the current situation of short term extensions and prolonged ambiguity cannot continue.

"Should a Parliamentary majority not be achieved this week, or agreement not reached with the EU at the emergency Council meeting, we cannot continue to take damaging short term decisions or risk a no deal departure. In this scenario, Make UK is calling for the Government to revoke Article 50.”

Britain’s customs system is not ready for Brexit

Over the weekend, Mr MacSwiney from the JCCC, also told Sky News that Britain’s customs systems were not ready for Brexit and that plans for properly preparing them had been ‘left to the last minute’. He said:

"I don't think HMRC have taken enough time to explain what we have to do. They have left it to the last minute and given people no time to prepare.

"If we ended up leaving on 12 April, HMRC would be ready with their infrastructure and computer systems, but the problem would be everything that goes on around that - the way that the information gets put into the system. That isn't ready. Nowhere near."

The JCCC represents the leading players in the UK’s customs industry and liaises with both government and HMRC in assessing and planning for the impact of Brexit. With the number of declarations being handled by customs likely to increase from around 55 million per year to over 300 million because of Brexit, the UK’s customs systems need to be resolute and will need to rely on some level of automation to cope. He said:

"The problem for us will be dealing with the huge increase in declarations and the only way to cope with that is more automation.

"That will take between 18 months and two years to get the computer systems ready. The process can be very time-consuming and there is a lot to get through."

Brexit uncertainty is already costing the UK 

Figures have also been released this week that show that Brexit uncertainty has already come with a significant cost for the UK. Goldman Sachs have estimated that the Brexit negotiations have cost the UK £600 million a week and £85 billion since the referendum. It is estimated that GDP would have been 2.5% stronger had the UK not voted to leave the EU in 2016.

Of course, the long-term impacts of Brexit are not known, and many advocates will argue that the UK could prosper in the long term – as a result of an independent trade policy and new trade agreements with markets outside the EU. But the current prolonged uncertainty about the UK’s future is undoubtedly having an impact.

Watch: How Much Has Brexit Cost? – Huffington Post

Grant funding for customs training extended to May 31st

In more positive news, the government has extended the deadline for businesses to apply for funding towards training courses that help them to complete customs declarations – a necessary administrative task for when Brexit eventually happens, and a task that already enables businesses to export around the world.

Several of the Institute’s courses can be funded by this government grant, and the deadline to apply for funding is now May 31st.

More information can be found at: https://www.export.org.uk/page/CustomsGrants