The government has allocated £2 billion in preparation for a no-deal Brexit. The money will be used to get a new border and customs operations ready, as well as gearing up UK trade policy with existing and new international partners, and taking back control of UK waters.
But five leading business organisations have called on politicians to prevent “a disorderly no-deal Brexit on 29th March”, saying: “With just 100 days to go, the suggestion that ‘no-deal’ can be ‘managed’ is not a credible proposition.”
“Businesses have been watching in horror as politicians have focused on factional disputes rather than practical steps that business needs to move forward.”
Chancellor of the exchequer Philip Hammond said the Home Office would receive £480 million, notably to increase Border Force capability.
HMRC will receive £375 million to enable it to employ more that 3,000 staff to handle the increase in customs activity, and deliver new technology to ensure trade is as frictionless as possible.
Defra will receive £410m to ensure uninterrupted trade in fish, chemicals, and agri-food. There will also be £190m for BEIS to develop a UK global navigation satellite system, and £128m for the Department for International trade to fund work on trade agreements.
This brings government funding for Brexit to £4.2bn.
The European Commission has set out its own package of 14 measures in the event of a no-deal Brexit. these include: customs, air transport, financial services and climate policy.
On customs, it said: “In a no deal scenario, all relevant EU legislation on the importation and exportation of goods will apply to goods moving between the EU and the UK. The Commission has today adopted the following technical measures:
* A Delegated Regulation to include the seas surrounding the UK in the provisions on time-limits within which entry summary declarations and pre-departure declarations have to be lodged prior to leaving or entering the Union’s customs territory.
* A proposal for a Regulation to add the UK to the list of countries for which a general authorisation to export dual use items is valid throughout the EU.
It is essential, however, that Member States take all the necessary steps to be in a position to apply the Union Customs Code and the relevant rules regarding indirect taxation in relation to the United Kingdom.
And on transport, it said: “The Commission has today adopted two measures that will avoid full interruption of air traffic between the EU and the UK in the event of no deal. These measures will only ensure basic connectivity and in no means replicate the significant advantages of membership of the Single European Sky. This is subject to the UK conferring equivalent rights to EU air carriers, as well as the UK ensuring conditions of fair competition.
* A proposal for a Regulation to ensure temporarily (for 12 months) the provision of certain air services between the UK and the EU.
* A proposal for a Regulation to extend temporarily (for 9 months) the validity of certain aviation safety licences.
The Commission has also adopted a proposal for a Regulation to allow UK operators to temporarily (nine months) carry goods into the EU, provided the UK confers equivalent rights to EU road haulage operators and subject to fair competition conditions.”
The five business organisations pressing for a Brexit deal include the Confederation of British Industry, British Chambers of Commerce, The EEF, Federation of Small Businesses, and the Institute of Directors.
In a statement, they said: “With just 100 days to go, the suggestion that ‘no-deal’ can be ‘managed’ is not a credible proposition. Businesses would face massive new customs costs and tariffs. Disruption at ports could destroy carefully built supply chains.
“Businesses of all sizes are reaching the point of no return, with many now putting in place contingency plans that are a significant drain of time and money. Firms are pausing or diverting investment that should be boosting productivity, innovation, jobs and pay, into stockpiling goods or materials, diverting cross border trade and moving offices, factories and therefore jobs and tax revenues out of the UK.
“While many companies are actively preparing for a ‘no deal’ scenario, there are also hundreds of thousands who have yet to start – and cannot be expected to be ready in such a short space of time.
And they called on MPs from all parties to return to their constituencies over Christmas and talk to their local business communities. “We hope that they will listen and remember that when they return to Parliament, the future course of our economy will be in their hands.”
* The Freight Transport Association warned that the EU contingency plans for a no-deal Brexit, did not alleviate the UK logistics industry’s concerns, saying the plans only provide limited facilitations, confirming that leaving the EU without an agreement in place will have serious consequences for logistics, and in turn, integrated supply chains and the EU & UK economies.
Pauline Bastidon, head of European policy & Brexit, said: “The EU’s very limited no-deal contingency plans will not allow trade to flow freely between the UK and EU, confirming expectations of border delays, supply chain disruptions, significant additional red tape for traders and operators alike, and restrictions to transport. While FTA is pleased to see the EU27 is taking steps to ramp up no-deal contingency planning, their proposals fall short of what would be necessary to allow our industry to keep the supply chain intact and trade moving.”
