Logistics industry warns PM of possible no-deal damage and disruption

Logistics industry warns PM of potential no-deal damage and disruption ahead of meaningful vote

The logistics industry has warned the Prime Minister Theresa May that a no-deal Brexit would cause significant damage and disruption, and break a promise she made in January 2017 to keep trade as frictionless as possible. 

Ahead of tonight’s meaningful vote in Parliament (12 March 2019) on the PM’s proposed deal with the EU, representatives from some the UK’s leading logistics organisations have written an open letter to Mrs May, shared with all MPs, reminding Parliament to consider “the needs of those tasked with keeping Britain trading and understand the costs and disruption of a no-deal departure from the EU on the UK economy, both in the short-term and the long-run”.  

Signatories of the letter include shippers and hauliers as well as the Freight Transport Association, which represents more than 17,000 logistics businesses.

James Hookham, FTA’s Deputy Chief Executive said: “For the past two years, the logistics industry has been warning of the potential disruption and damage of a no-deal Brexit, which could include short-term gridlock at ferry ports if customs processes and checks are not implemented smoothly, shortages of perishable foods and medicines, restrictions in the labour market caused by a shortage of workers as they return to the EU and severe delays for imports and exports which would hinder the UK’s manufacturing and retail sectors. The Government believes it has developed the necessary procedures to be followed but yet there is still so much to be agreed and announced.

“Whatever the final outcome of tonight’s vote, and those later this week, the logistics industry needs sufficient time to learn, adapt to and implement the necessary operational processes to comply with the announced procedures. With just over two weeks to go until the UK’s proposed departure from the EU, it is worrying that we still have so much to clarify.”

The letter lays out the priorities which, Hookham explains, the logistics industry has been lobbying Government for clarity over since Article 50 was triggered, back in 2017:

“The logistics industry is agile and adaptable, and will respond to challenges, but it is impossible for those involved in complex supply chains to adapt to new trading conditions in a matter of days. The sector still needs confirmation of many aspects, including whether road haulage permits will be required, the level of customs tariffs, access to a skilled workforce and how red tape will be minimised for imports and exports. Slipping to a no-deal situation, and reverting to complicated WTO rules and tariffs, would impose additional costs of between 5-35% on the UK’s supply chain.

“Mrs May needs to urge Parliament to recognise the real jeopardy that a no-deal Brexit, as outlined in today’s letter, would impose on the logistics industry and the country as a whole.  Business cannot trade on “what if’s?” and “maybe’s” – a transition period to whatever the new market arrangements will be is essential if Britain is to keep trading efficiently after its departure from the European Union.”