Brexit reality dawns

London, UK: We have had the rhetoric from the Brexiteer fanatics, now comes the grim reality. And the news is not good for business or for British citizens, says Dean Stiles.

Forget the promises of vast tranches of money supposedly spent on the EU since they never existed; forget the promised land of free trade with the world – our biggest trading partner remains on the other side of the channel, not across oceans.

Leaving the EU and the single market will see massive costs imposed through red tape and new restrictions. Almost no aspect of trade or travel to and from the EU will escape: all this on top of a depression triggered by the coronavirus epidemic.

From January it will be harder to recruit labour from outside Britain; harder to export, harder to import, even with the United Kingdom.

This is folly on a truly grand scale. It was avoidable, but no politician had the courage to exercise their constitutional right to ignore the referendum result and manage the electorate’s expectations and demands in other ways.

If your business has any reliance on low-skilled workers from the EU – and in the government’s view low-skilled includes most warehouse staff and truck drivers – you can expect a dire staff shortage.

The Home Secretary, Priti Patel, has set out post-Brexit immigration details due to come into force on New Year’s Day, immediately ending freedom of movement with the EU.

The government wants to bring in a “points-based” immigration system which would reward high-skilled workers. Points would be awarded for criteria such as having a job offer, holding a PhD relevant to the job, speaking English and earning more than £22,000. Those with job offers in “shortage occupations” such as nursing and civil engineering would also be able to earn extra points.

The biggest change and biggest impediment to trade comes with the reintroduction of customs and tariffs and bizarrely these will even apply within the United Kingdom. The key change under prime minister Boris Johnson’s deal is the creation of a customs border between Northern Ireland and Great Britain. Some goods entering Northern Ireland from Great Britain will be subject to checks and will have to pay EU import taxes, refunded if goods remain in Northern Ireland and not moved to the Republic of Ireland.

UK hauliers will no longer be able to operate within the single market. The access rights that EU operators and UK operators will have to each other’s respective markets will depend on the outcome of the future relationship negotiations. Without an agreement, only the limited quotas under the European Conference of Ministers of Transport (ECMT) will be available for EU operators to conduct journeys to the United Kingdom, and for UK operators to conduct journeys to the EU. The Freight Transport Association estimated in evidence to the House of Lords that “ECMT permits would cover 2% to 5% of UK transport needs.”

Border formalities will also affect drivers as well as passengers and cross-border workers. This includes border checks on persons – entailing the verification of entry and stay requirements, stamping of passports, and visa requirements if applicable.

Customs rules required under EU law will apply to all goods entering the customs territory of the EU from the United Kingdom, or leaving that customs territory to the United Kingdom. Even if an ambitious free trade area is established with the EU, providing for zero tariffs and zero quotas on goods with customs and regulatory cooperation, all the regulatory non-tariff barriers, usually far more costly in extra paperwork and delays than any tariff, will still apply.

And all this because of a tiny minority of Conservative party MPs who wanted to trigger some fanciful notion of free trade, “Britain is great again”, policies and a referendum in which a third of the population chose not to participate, and of those voting, barely over half wanted to leave the EU.

You have to go back to the 1770s for an example of British government policy so poorly thought out, when levying uncollectable taxes triggered the revolt by the American colonies.

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