Friday 10 July 2020

The Truss letter

The letter from Trade Secretary Liz Truss to Michael Gove and Rishi Sunak leaked to Business Insider and The Guardian, is a sign of the growing realisation that the end of year deadline the government has set itself is under serious threat.  The EU must look at this as the French Fleet at Trafalgar might have done had they noticed Nelson's ships were either sinking fast or being desperately bailed out as the two sides approached each other.
Truss seems to have belatedly recognised there are some big issues coming up very quickly. After seeing Truss' letter, BI claims that:


"UK Prime Minister Boris Johnson's Brexit border plans could break international trading rules, risk the UK's international credibility, and lead to smuggling from the European Union, a senior member of his government warned in an explosive leaked letter seen by Business Insider."

She sets out "key areas of concern" including that waiving imports through from Calais after 1 January next year will come under challenge from the WTO - this is more of an embarrassment than anything else for a country championing free trade and putting forward a candidate to become head of the WTO - to be seen flouting the rules so soon is a tad awkward to say the least.

Truss is also worried about smuggling between Calais and Dover with companies able to circumvent VAT and duty on all sorts of stuff.

Next, it's clear she has little faith that the systems needed to manage imports will even be ready by July 2021 - the extended date!  She writes:

“I would like assurances that we are able to deliver full control at these ports by July 2021 and that plans are in place from January to mitigate the risk of goods being circumvented from ports implementing full controls,

Finally, the International Trade Secretary appears to have finally understood what is in the NI protocol because according to The Guardian she raises the issue of tariffs:

"Customs controls are being applied as part of the special arrangements for the region to avoid a border on the island of Ireland. She reveals that the digital application of the special tariff regime for Northern Ireland has been deemed 'high risk' and 'HMRC are planning to apply the EU tariff as a default to all imports in NI from 1 January 2021'."

" 'This is very concerning as this may call into question NI’s place in the UK customs territory,' Truss wrote in relation to the potential imposition of tariffs."

Well fancy that.  Legal experts, including the one I posted about just yesterday morning, have been telling us for months, since the protocol was published last year in fact, that the default position is that tariffs will apply to everything - unless they can be shown to be NOT at risk of entering the EU. HMRC are only doing what the prime minister signed up to - whether he realised it or not - when he signed the Withdrawal Agreement.

The fact that Johnson, Gove, Lewis and others have continued to give the impression of "unfettered" access is being questioned at cabinet level now.

All of the Tory MPs who have so far relied on Johnson's assurances will soon discover they are completely worthless. We will be forced to comply with the letter and the spirit of the protocol sooner or later.

As for "assurances" that we will be ready by July 2021, I'm not sure I would believe anything that Gove or Johnson said on that score.  They have the mindset of journalists. Say whatever you like and tomorrow it's all forgotten and you start again with a blank screen.

They are now at the point where real decisions are needed and hard ones too, with practical and for some, devastating consequences.  Gove always used to complain the CFP put his step father out of business and has held that grudge for years. I hope he realises that the people who will be put out of business by his policies will feel no less of a grudge towards him and the Tory party and the UK government for years.

The Guardian report says that DEFRA is looking at ways to get around some of the provisions in the NI protocol:

It comes as the environment secretary, George Eustice, revealed that the government is looking for some form of exemption for food arriving in Northern Ireland from Britain.

“We will be trying to work out whether there can be special provisions on that, otherwise it will cause quite an issue,” he told a Lords committee, conceding that the “time is tight” to put any measures in place.

However, there is perhaps for Ms Truss at least one bright spot. She needn't worry about Britain's "international credibility" because we have got any.