UK Transport and Brexit News & Views No. 18

UKTiE Brexit or 360° members can ask for more information if you wish to explore behind the headlines or require some bespoke analysis. Please contact us if you would like to join.

Hope you had a good Easter! First of all a warm welcome to the Port of Dover who have just joined us as an UKTiE Brexit member.
Despite the break, UKTiE’s work goes on, with meetings last week with constitutional EU expert Richard Corbett MEP, Labour Transport Spokesperson Lucy Anderson MEP, and Guy Verhofstadt’s Brexit team to discuss the latest on the negotiations. We submitted a letter setting out our core principles for the negotiations. The feedback for UK transport was stark and a report is available for Members.  We have now successfully opened up these important channels of communication and have been invited to re-engage periodically, and in the meantime submit ‘solutions’ in the coming weeks. We will shortly be meeting Commission and Council negotiators and submitting a detailed position paper. 

1. UKTiE meetings with Richard Corbett MEP and Guy Verhofstadt’s Brexit team
Last week, our members joined us in Brussels to meet with Richard Corbett MEP, member of the S&D Political Group and of the Committee for Constitutional Affairs of the European Parliament. We also met European Parliament’s Chief Brexit Negotiator Guy Verhofstadt’s Chef de Cabinet – Guillaume McLaughlin – who provided the latest position on the Brexit negotiations from the EU side and offered UKTiE members clear advice. He praised the initiative of UKTiE and its members in coming together to make their voices heard, and called for more unity and creative alliances to ensure the best possible solutions are put forward. He invited us to liaise regularly and submit solutions. Full reports of the meetings are available for UKTiE members. In my role as UKTiE co-ordinator, I also with met Lucy Anderson, Labour Transport Spokesperson for an exchange of views. Lucy will be meeting key Brexit players and UKTiE in the near future. Lucy will be meeting key Brexit players and UKTiE in the near future.

2. A concerned shipping industry calls on non-UK ports to be part of the customs solution…
Guy Platten, Chief Executive for the UK Chamber of Shipping has expressed concern that not all European countries seem to grasp that a hard border at UK ports could cause problems outside the UK. The Chamber has said that it is not the reintroduction of tariffs that will cause problems, as these could be dealt with electronically, but rather the question of customs checks. Mr Platten said that one solution may be customs checks at the point of dispatch or sale, and that ports such as Calais, Zeebrugge and Dublin need to part of the solution. He also said that passenger operators such as P&O and Stena Line were also growing increasingly concerned.

3. …but a new ‘Leave’ trade report sets out blueprint for frictionless customs and opportunities
A new Leave Means Leave report titled Brexit and a Future UK Customs System: A Blueprint for Frictionless Trade seems more optimistic about port’s future. They agree with Platten that businesses are more concerned with customs procedures than new tariffs. This report, written by the former Director General of the British Chambers of Commerce, John Longworth, was written for the consideration of the Government and details what customs procedures the UK already has in place that could be expanded and also some new ideas for future customs controls. The report, like many others, believes that technology will be crucial to smoothen the procedure and that the UK should be open to creating special status for important trading partners, as they believe Brexit to be “a huge opportunity for Britain to become a more effective force for trade.”

4. Diageo may be forced to ‘rethink whole supply chain model’
When asked how a hard border would affect drinks giant Diageo (producer of Guinness and Baileys), Freight Transport Association’s Seamus Leheny was not optimistic. “As the UK will be outside EU Customs Union, it’s highly likely, unless a special deal is done for Northern Ireland, that the Rule of Origin will apply therefore for every load going to and leaving the Belfast plant would require a certificate of origin or an EUR1 form”. These forms cost £24.03 each, without counting the administrative costs and delays at the border. A recent FTA study estimated the cost of delay would be £3.21 per truck per minute. Therefore Leheny thinks that Diageo will be forced to rethink its ‘whole supply chain model’.  

5. Employers struggle to reassure staff with Brexit anxiety
For the first time since 2014, the number of non-UK EU nationals employed in the UK has dropped as employers are struggling to reassure their EU staff in face of Brexit uncertainty, reveals the Financial Times. Professor Chris Roebuck, of Cass Business School, urges employers keep up constant open communication with their employees, even if they have nothing new to add, to dispel the feeling that “managers are cloistered in secret meetings making Brexit-related decisions that will wreak negative effects on their lives.” At the same time industries have been telling policymakers that the suggestion that British workers can simply replace EU nationals is a “fallacy”.  They said that finding and training enough British workers would take at least a decade, something they want the Government to take into account while negotiating new immigration agreements. 

6. India looking to profit from Brexit
The Telegraph has written that a post-Brexit deal with India could be worth an extra £2 billion to British economy, based on a Commonwealth report titled “Brexit: Opportunities for India”. The author of the report, Rashmi Banga wrote that an “India–UK FTA may be easier to negotiate than the India-EU FTA, as some of the sticking points in an India-EU FTA may be easier to resolve.” Chairman of People Over Profit, the crowd funded British airline said that they would welcome a such an agreement, and are in fact confident about the cargo and passenger opportunities that Brexit will enable.

7. Road to Brexit: the real players that will keep EU talks going
The Independent has revealed who they believe are the most powerful players in the UK and EU’s negotiating teams. As well as the obvious ones, such as Theresa May, and Michel Barnier, they have introduced readers to some lesser-known figures. One is Mr Barnier’s deputy, Sabine Weyand, a Commission trade expert and another is Alex Ellis, who is a director general in DExEU. Another member of DExEU they believe is important is Oliver Robbins, who acts as Ms May’s EU Sherpa. They also drew attention to Martin Selmayr, Mr Juncker’s chief of staff, who they say is hostile towards Brits and is widely thought to be behind the £50bn bill. The FT also ran with a similar analysis: ‘The power brokers behind Brexit’ identifying Nick Timothy and Martin Selmayr, who they argue will be the ‘ferocious political operators will shape negotiations from behind the scenes.’

8. No early deal for aviation
The FT ran the ‘Airlines grounded by Brexit’ story, given the growing fear that that the worst-case scenario could halt flights between the UK and Europe for a period of weeks or even months if the government fails to strike an early Brexit aviation deal with the EU.  Given the long lead in time for flight schedules, the aviation industry is having to plan for a range of different scenarios. The industry is hoping for an early deal, but this is unlikely to be an easy or quick process as it would require unanimous support from all states, and the UK would likely need to submit to the authority of the European Court of Justice, something the UK government has ruled out. UKTiE has been engaged in high level talks on this issue, and the view in Brussels is clear: ‘no early deal on aviation.’ The UK are going to have to offer something pretty significant to broker the compromise that will eventually be needed.

9. UKTiE have also put together the latest timetable for Brexit. We will keep this up to date as the process develops: