The UK will face serious disruption on a number of fronts when the Brexit transition deal ends, the Whitehall spending watchdog has warned.
The National Audit Office (NAO) said UK trade with the EU will be seriously affected regardless of whether a trade deal is agreed before December 31 when the transition deal ends.
A new report has revealed concerns across a range of issues, from plans to maintain the supply of medicines to lorry sites needed to avoid huge queues.
It comes amid uncertainty as to whether the UK Government and the EU will reach a deal to avoid a no deal Brexit.
This is what the NAO has revealed.
- it said preparations for the new border controls – which had already been rated “high risk” – had been worsened by the pandemic. The controls are due to come into place on January 1.
- the NAO said key IT systems had yet to be tested.
- it revealed transit areas for lorries were not ready. The NAO also said that the Government had still not taken the steps required to ensure there were enough. While the Government has identified seven inland transit sites for lorries, HM Revenue and Customs (HMRC) has said getting them all ready for January 1 was proving to be “very challenging”.
- the NAO said that the Government had still not taken the steps required to ensure there were enough customs agents. People in these posts are seen as “vital” to the smooth working of the system.
- At the same time, the NAO said civil contingency plans to maintain the supply of medicines and other critical goods – including acquiring extra freight capacity away from the main Channel crossings – were proving more difficult to sort out as a result of the pandemic.
- the NAO also highlighted concerns about the checks that will be required for goods moving to Northern Ireland from the rest of the UK. They said Northern Ireland’s Department of Agriculture, Environment and Rural Affairs (DAERA), which is responsible for checks on agri-food products, had been “severely hampered” by the ongoing trade talks with Brussels, as well as a “lack of clarity” over the measures required. As a result, DAERA has concluded it will not be possible to complete the necessary work on its systems and infrastructure by January 1. It said it was having to explore “contingency options”.
- the NAO said the Government had left itself little time to mobilise its new Trader Support Service. This is designed to help businesses moving goods between Great Britain and Northern Ireland. This meant there was a “high risk” traders would still not be ready when the new arrangements start, the NAO said.
- according to the Government’s latest “reasonable worst case planning assumptions”, between 40 per cent and 70 per cent of lorries transiting between the EU and the UK may still not be ready for the new border controls by January 1. Ministers have already warned hauliers they could face queues of up to 7,000 lorries at the main Channel crossings. While arrangements were being developed to minimise delays, the NAO said these depended on new technology – and stressed they would require the engagement of both trades and hauliers.
- the NAO has also warned there is little time left for ports to integrate their systems and processes with new government systems, and is warning that they may have to fall back on “manual processes”.
- although ministers have delayed the imposition of full import controls on goods coming from the EU until July 2021, the NAO said there was still “uncertainty” over where the infrastructure would be located and whether it would be ready in time.
- and it warned that the HMRC still needed to make significant changes to its customs systems to handle the increase in customs declarations. They said this was the case even though it had known this was likely to be necessary since planning for a no-deal Brexit began in 2017.
Gareth Davies, the head of the NAO, said: “The January 1 deadline is unlike any previous EU exit deadline – significant changes at the border will take place and government must be ready.
“Disruption is likely and government will need to respond quickly to minimise the impact, a situation made all the more challenging by the Covid-19 pandemic.”