Trade relations between the UK and EU are due to be strained and face disruptions following Brexit on January 1, even if a deal is brokered between the two parties.
Photo: Dunk / Flickr. Licence: CC BY
The two sides have been calling on the other to compromise in Brexit talks as its ramifications on the UK economy are already being felt.
With a little over eight weeks to go before the transition period ends, both parties are still deadlocked over how to move forward on mutually-beneficial terms.
The National Audit Office (NAO) has warned that sufficient IT systems have yet to be tested and transit areas for lorries are not ready as the government devices new border plans for when the UK formally withdraws from the bloc.
These already risky precautions have only been worsened by the effects of the coronavirus pandemic as the public await another extension so the country can recover from the crisis.
Many sectors are still reeling from the effects of the pandemic, and many aspects of the British economy have been ground to a halt for a number of months now.
A brief moment of grace in September was followed by a massive second wave which has forced the government to initiate another nationwide lockdown.
Murmurings of a furlough replacement scheme have been met with the news that the systems in place are being extended until March, well past the Brexit transition date on January 1.
Auditors have said that officials have not taken the required steps to ensure that there were enough custom agents, while contingency plans to ensure an adequate supply of medicines away from the main Channel crossing have been complicated by Covid-19.
Meg Hillier, the chair of the public accounts committee, told the Guardian that the government has not given businesses enough time to prepare.
She added: “It’s incredibly worrying that, with two months to go, critical computer systems haven’t been properly tested. The government can only hope that everything comes together on the day but this is not certain."
According to the government's latest forecasts, between 40 and 70% of lorries travelling between the EU and UK are still not prepared for the new border controls.
Ministers have already warned of massive queues at the major junctions into the continent.
The NAO admitted that plans were in motion to minimise these delays but they are dependent on new technology and full cooperation between hauliers and traders to become fully operational.
Ultimately, if an extension is not made to the Brexit deadline, ports and major trade roots will have little time to integrate these new systems.
Gareth Davies, the head of the NAO, said: “The 1 January 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 the government will need to respond quickly to minimise the impact, a situation made all the more challenging by the Covid-19 pandemic.”
In a statement, a government spokesman said: “We are making significant preparations to prepare for the guaranteed changes at the end of the transition period – including investing £705m to ensure the right border infrastructure, staffing and technology is in place, providing £84m in grants to boost the customs intermediaries sector, and implementing border controls in stages so traders have sufficient time to prepare.
“With fewer than two months to go, it’s vital that businesses and citizens prepare too. That’s why we’re intensifying our engagement with businesses and running a major public information campaign.”
The government has identified seven key major sites for primary integration, but adapting them is reportedly proving "very challenging."
Previous trade concerns regarding food standards were allayed on Monday following a parliament vote to set up a body to examine food standards before being imported.
This comes nearly a month after the revelation that the UK's largest potential trade partner - the US - was exporting severely contaminated food.
A few days later, MPs explicitly rejected a bill that would apply domestic standards on all food imported into the UK as a result of a trade deal.
Monday's ruling appears to have been made in response to public backlash regarding the incident.
The automotive sector also received bad news following the EU's rejection of London's plans to avoid tariffs on exports.
They wanted car parts from Japan, South Korea or Turkey to be assessed as British when imported into the country.
The Bank of England has said it will pump £150 billion into the UK's economy but has warned that Brexit will cut 1% from the country's GDP.
Negotiations for a trade deal are still at a stalemate.
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