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Disruption in store for NI after Brexit

National Audit Office says we're not prepared for transition period and Covid has made matters even worse

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Report: uncertainty over the movement of goods is highlighted by the Audit Office

Report: uncertainty over the movement of goods is highlighted by the Audit Office

Collins Dublin, Colin Keegan

Report: uncertainty over the movement of goods is highlighted by the Audit Office

Northern Ireland is far from ready for the end of the Brexit transition period in just over 50 days, and widespread disruption is likely, according to the National Audit Office (NAO).

Covid-19 has "exacerbated" delays in the Government's preparations for the end of transition on December 31, particularly in relation to Northern Ireland, the NAO reports.

"Departments face a significant challenge in implementing the Northern Ireland Protocol by 1 January 2021," the agency states in its latest Brexit report today.

"Implementing the Protocol is very high-risk due to: the scale of the changes required; the limited time available; the dependence on ongoing negotiations; and the complexity of the arrangements."

It adds: "Delivery risk is also heightened by the need to integrate and manage changes across multiple projects and stakeholders."

The NAO warns that the UK Government has left little time to implement the trader support service (TSS), the £200m plan to ease the burden on companies on moving products to NI.

"It will be challenging to establish the TSS by January 1, 2021. Work needs to be done to identify NI traders and sign them up to use the service; recruit and train the staff required; develop software to enable traders to connect to HMRC's systems; and deliver educational activities to traders," the NAO reports.

"There is also ongoing uncertainty about the requirements for the movement of goods under the Protocol. Therefore, there is still a high risk that traders will not be ready."

The report reveals that Her Majesty's Revenue Commissioners (HMRC) signed a contract in mid-October with Fujitsu to deliver TSS but the details, including cost and duration, are not finalised.

"It will be challenging to establish TSS within the timeframe, including: activity to identify NI traders and sign them up to use the service; recruit and train the staff required; develop software to enable traders to connect to HMRC's systems; and deliver educational activities to traders," the NAO says.

Further, the report warns the Government "needs to be alert to any increased risks of smuggling or other criminal behaviour which exploits gaps or inconsistencies in border operations."

It adds: "There is a risk that widespread disruption could ensue at a time when government and businesses continue to deal with the effects of Covid-19."

Northern Ireland's Department of Agriculture, Environment and Rural Affairs (DAERA) is responsible for putting in place the systems, infrastructure and resources to undertake sanitary and phytosanitary (SPS) checks.

"Its ability to take forward this work has been severely hampered by the ongoing negotiations and, in the case of infrastructure, the lack of clarity about the level of checking that will be required," the report states.

"Given the ongoing uncertainty and tight timeframe, DAERA considers that it will now not be possible to complete the necessary work on its systems and infrastructure in time for January 1, 2021 and is exploring contingency options."

The report flags up how revenue commissioners must deal with two sets of tariffs on goods coming into NI "depending on whether they are destined to remain in Northern Ireland or are 'at risk' of moving into the EU".

"This arrangement, known as a 'dual tariff regime', is not known to operate anywhere else in the world," the report notes.

"The outcome of negotiations between the UK and the EU could make the system more complicated to apply if there is no free trade agreement that reduces or eliminates tariffs or no agreement that some goods are not at risk of onward movement," the NAO says.

HMRC has told the NAO that it can deliver most of what is needed but admits that bringing everything together is "very high-risk" with little time for software providers to deal with problems during testing.

DAERA told the NAO that more work on infrastructure is needed in Belfast, Larne and Warrenpoint to make sure of compliance with EU controls.

"Due to the ongoing negotiations in the Joint Committee, DAERA does not have clarity on the amount of infrastructure which might be required for checks, which could vary significantly depending on the level of checking agreed with the EU," the report states.

"On September 17, 2020 DAERA issued invitations to tender for the construction work required at Belfast, Larne and Warrenpoint on the basis of its best estimate of the infrastructure required. This may need to be scaled up or down at a later date.

"On September 18 DAERA told us that it would not be possible to complete the build in time for December 31, 2020 and on October 8 DAERA told us that it was now engaged in contingency planning to identify what could be achieved by that date.

"This included the arrangements associated with staff, process and facilities at each of the sea ports in Northern Ireland."

The report adds: "Failure to deliver the changes required could put the UK in breach of the obligations set out in the Withdrawal Agreement and cause uncertainty for traders."

Belfast Telegraph


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