8 Aug 2023
The intended system, already postponed multiple times, now faces reluctance from the government and businesses over potential price hikes due to increased paperwork.
UK officials are preparing to announce another delay in post-Brexit border checks on animal and plant goods imported from the EU, amid rising concerns that additional paperwork for imported items could worsen inflation.
The decision to defer the new import scheme at UK's ports, originally scheduled to commence in October, is also designed to provide businesses and port managers with additional time to establish the necessary processes.
This information is disclosed prior to a meeting of the Bank of England's monetary policy committee, which is grappling with high inflation rates that are refusing to ease.
The establishment of a post-Brexit border control system for goods entering the UK from the EU has faced continual postponements. It's noteworthy that goods exported from the UK to the EU are already fully inspected.
As recently as April, officials announced that a new "border target operational model" would start its rollout from October 31 and that the complete system would be functional by October 2024.
However, government sources informed the Financial Times that while the final plan's details will be made public "very soon", its implementation will be delayed.
"The main factor driving this is our commitment to control inflation, which is why we're experiencing a delay," stated a government source familiar with the plan. "There will be additional expenses at the border."
The revised schedule has yet to be approved by officials, but the new system's implementation is likely to shift to next year.
Others mentioned that businesses need adequate time to adjust to the new regulations. "The efforts that businesses have made will not go in vain," said a government official. "The changes will occur, but there will be a delay."
A government representative confirmed that ministers were meticulously reviewing feedback from "stakeholders" to ensure they had sufficient time to prepare, while adding: "The Border Target Operating Model will be published shortly."
Health certificates for imports of "medium-risk" products were set to begin in October, with physical checks commencing in January 2024 and safety and security declarations for EU imports starting from October 2024.
When questioned if the government was still committed to this timeline, the spokesperson said that the new, simplified system compared to last year's proposal would be introduced gradually.
Chancellor Jeremy Hunt and Prime Minister Rishi Sunak have prioritized addressing inflation and have shown willingness to challenge Brexiter principles, such as "gaining control" of borders and deviating from EU regulations, to reduce business expenses.
On Tuesday, the government abandoned plans for a post-Brexit UK equivalent to the EU's "CE" product-quality mark after businesses cautioned that officials were entangling companies in unnecessary paperwork.
On Wednesday, Sunak informed broadcaster LBC that inflation was not declining as quickly as he had hoped but stated that it would have a "completely transformative" effect on the public when it returned to lower levels. Notably, food prices have soared particularly quickly.
In an industry briefing document last April, the government firmly asserted that it was its "solid intention" to launch the first phase of border controls this October after four previous postponements. The original plan was to have begun in July 2021.
Last June, the food industry warned that plans to impose a flat-rate inspection fee of up to £43 on each shipment of food from the EU would lead to increased food prices. The government projected total additional costs of EU controls at £420 million annually.
According to the proposed controls due to be implemented on October 31, EU food product exporters to the UK would have needed "export health certificates", costing several hundred euros each, and requiring physical endorsement by a veterinary surgeon.
Shane Brennan, the leader of the Cold Chain Federation advocacy group, stated that any decision to postpone the October requirements was the "correct course of action" given inflationary pressures and a lack of awareness in the EU regarding the impending controls.
A poll of Cold Chain Federation members last July revealed that 40% of their EU-based clients and suppliers were oblivious to the upcoming requirements.
The British Chambers of Commerce also deemed the delay in October controls as "prudent" given the current inflation rates but cautioned that any plan to introduce new paperwork and physical inspections at the border concurrently next year would necessitate the readiness of the required port infrastructure.
Nick von Westenholz, director of trade at the National Farmers Union, acknowledged the government's need to protect consumers from price hikes but stated that another delay would further frustrate many farmers, who confront export barriers not reciprocated on imports from the EU.
"We require proportional, light-touch inspections that can both maintain minimal costs for importers and properly manage biosecurity risks," he said. "The government must promptly establish a clear and firm schedule for the new import system, so we can provide a level playing field for UK growers and producers."
Nigel Jenney, Chief Executive of the UK's Fresh Produce Consortium (FPC), voiced his opinion on the situation. "If confirmed, this was the only credible conclusion, otherwise the UK Government would be directly responsible for imposing further considerable and avoidable costs on both industry and consumers," he said.
He further emphasised the need for the government to take advantage of the delay. "However, the Government must use this time wisely to listen to industry and implement effective solutions which remove these unnecessary costs and delays prior to future implementation."
Jenney further highlighted the role of the FPC in devising potential solutions. "FPC, in conjunction with its members, has offered several effective solutions which must now be rapidly rolled out. These include cost-effective inspection solutions for SMEs, groupage consignments, and the approval of responsible companies to complete their own official inspections."
He closed with a call to action for the government. "Ultimately, we need cost-effective border solutions which support our international trade ambitions while meeting the needs of our highly efficient diverse supply chains."