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Government-backed scheme trains 1% of border agents for post-Brexit

Chemicals and pharma set to be among the hardest hit by “chaotic” border disruption next year
Government-backed scheme trains 1% of border agents for post-Brexit
  • Investors Chronicle revelations spark warnings of “chaotic” disruption to businesses that depend on EU trade
  • Chemicals and pharma firms likely to be among the hardest hit by a shortage of people able to process customs declarations
  • Up to 50,000 extra staff could be needed to process 200 million more customs forms annually 

A government-backed scheme has trained less than 1 per cent of the estimated 50,000 customs agents needed to maintain smooth trade post-Brexit, new figures reveal, sparking warnings about “chaotic” disruption to UK businesses.

With just weeks until the end of the Brexit transition period, and a trade deal yet to be agreed with the European Union, business leaders say firms are “a million miles” from having the extra staff they need, while chemicals and pharmaceutical companies could bear the brunt of delays at the border.

Data obtained by the Investors Chronicle show that by 15 October, just 179 people had completed professional qualifications through an online “customs academy” launched with government support last August to boost the number of staff able to process customs declarations. 

By the end of the Brexit transition period on 31 December, the taxpayer-funded academy is likely to have awarded fewer than 250 of these qualifications in total, based on the amount of trainees who have started courses and the usual time it takes to complete them.

While the government said it has funded thousands of programmes through other private providers, the small number of people successfully trained by a scheme it promoted and paid for itself has sent alarm bells ringing.

“If that is an academy the government has set up, it’s a pretty poor result,” said Richard Burnett, chief executive of the Road Haulage Association, which has predicted the UK will need 50,000 more staff to handle an extra 200 million customs forms annually.

“Yes, there are other people training agents, but we are a million miles away from the number of people we need,” he said, adding other course providers would not be making up for the shortfall. “We have run out of time. We have gone past the point of no return … If you cannot find a customs agent you cannot export. You simply cannot send your stock to the EU.”

Cabinet minister Michael Gove, who previously declined to reveal how many new customs agents have been trained, has not contested the RHA’s estimates of the number of extra staff needed, which could vary depending on the trade deal struck with the EU. If there are not enough form-fillers processing the extra paperwork from next year, goods moving to and from the UK’s largest trading partner risk being delayed at the border, disrupting supply chains for companies that have relied on largely frictionless trade with the EU for years.

Since predicting up to 245,000 traders could have to start making customs declarations for the first time, HMRC has made more than £80m in grants available to businesses and customs outsourcing firms to fund training for employees.

But only 1,523 people have started courses with the state-backed UK Customs Academy, which now operates as a private business after originally being run with government support. According to the figures obtained through a freedom of information request sent by the IC, more than 900 of these trainees have enrolled in an entry-level course and will not be able to lodge customs declarations without achieving one of the more advanced qualifications.

Based on the academy’s own estimates of the usual time taken to complete each of these higher qualifications, just 233 are likely to be awarded before next year. 

Industry leaders had already warned that the government was falling far short of the target for new customs agents, accusing it of providing insufficient funding and guidance. The amount firms could take in grants was capped by EU state-aid rules until these were lifted by the government recently, while Mr Burnett said much of the money has been used to poach customs staff that were already qualified.

But the government has pointed the finger back at businesses. After cautioning that UK traders could face two-day delays getting freight across the Channel, with queues of up to 7,000 lorries in Kent, Mr Gove said in September the biggest potential cause of disruption was “traders not being ready”. Last month, fellow minister Theodore Agnew angered companies when he accused them of taking a “head in the sand approach” to the coming border frictions. 

Responding to the data obtained by the IC, a government spokesperson said the UK Customs Academy is only one training provider and in total grants have been approved for “more than 26,000 courses”, although they did not indicate how many of these are likely to be completed by January.

 

Chemicals and pharma may bear the brunt

With the looming prospect of disruption at the UK-EU border, many UK companies should be largely unaffected, as the majority of the country’s economic output comes from the sale of intangible services. But delays would fall particularly heavily on those who depend on the rapid movement of physical products and supplies, including carmakers and food producers.

The Institute for Fiscal Studies has said pharmaceuticals and chemicals firms will be some of the worst affected by new trade barriers, as they import much of their supplies from the EU, while simultaneously selling a lot of their products to the region. According to its analysis, these industries collectively imported 27 per cent of their intermediate goods from the EU in 2014, the most recent year for which data are available. 

The large number of companies in these sectors that sell perishable items to the EU could be particularly vulnerable. Stephen O’Hara, CEO at Aim-traded OptiBiotix (OPTI), said the biotech firm’s international distributors have already warned they still want to receive its food supplements with a full shelf life. But he said the company mitigated this risk by shifting production from the UK shortly after the Brexit referendum vote in 2016.

He added: “No matter how much the industry prepares, unless the government prepares in terms of having customs officials to allow trade to happen, it’s going to be pretty chaotic quite frankly.”