In the Commons Future Relationship with the EU committee I asked three customs experts what the percentage likelihood is of ‘chaos in Kent’ in January. Their responses were 80%, more than 50% and 75%. I hope they are wrong.
Stephen Kinnock: Many thanks to the panel for joining us today. I wanted to focus on the export side of this, so from GB to EU. There was one thing I wanted specifically to ask about. I read that a part of the process here would be to create a Kent access permit, whereby lorries in GB would only be allowed into Kent once they were border ready. If they get into Kent and it is discovered that they are not border ready, they could be subject to a £300 fine and potentially have their lorries impounded. Richard, could you confirm that is the case? Is that what the Government will be doing?
Richard Burnett: We do not yet have clarity on exactly how this is going to work. Again, it was a question that was raised on a ministerial roundtable yesterday to get further understanding about how this would work.
The industry as a whole is questioning how you would identify whether or not this is a vehicle going to Europe, because you will have vehicles going into Kent to deliver goods domestically anyway. How you come up with some sort of passport or permit and how that is going to be policed still have not been answered. What they are saying at this point in time is that the intention is to have a fine in place. That fine is likely to be an on the spot fine.
Let us come back to the detail again: 85% of the volume that comes in from Europe is on European vehicles. Therefore, the lion’s share going back are effectively European operators. You are going to be stopping European operators. You are going to have to fine them on the spot somehow and decide whether or not you are going to impound at that point in time. Some of these processes are ill thought-through, I would suggest, at this stage. What is the root cause of this happening? It comes back to customs intermediaries; it comes back to getting the paperwork ready. If you get the paperwork ready, we will not have this problem. That is where the problem lies.
Stephen Kinnock: Is it fair that hauliers should be paying the price for the lack of detail and information that is the foundation of the problem here? Why should hauliers potentially be having their lorries impounded when they do not have clarity in terms of the basic information? Is that fair?
Richard Burnett: It is not fair, by the way, but what Government are trying to do is to stop people going to Kent and creating chaos. I understand that principle, but we have to put processes in place that actually solve the problem. We have been saying over the last three years, and certainly at the beginning of this year when we were meeting, that we need to increase the number of customs intermediaries to be able to solve that problem.
Stephen, it is not the right approach. It will not necessarily solve the problem. The offices of departure may well have to be a solution to taking that problem away from Kent. Again, we need to understand how those are going to operate and we need to understand Government’s thinking, and we still do not.
Stephen Kinnock: Robert, on the training issue, are we talking about customs agents and facilitators who need training, or are there other key players that are going to need training here, such as the drivers of lorries? It would just be useful to get a sense of the overall training requirements and what the gap is in terms of both the number of people who need training, the types of people who need training and, if you like, the years we may need in terms of getting people up to full capacity.
Robert Hardy: Training worries me. There is some very good customs training through the UK Customs Academy. There are also people going out and buying the software and saying, “I now have the customs software”, but buying a cookbook does not make you a Michelin starred chef. It just means you have a cookbook.
One of the biggest areas we spent a lot of time training with hauliers, ferry operators and ports is the sequencing of events. The sequencing of events is just as important as the knowledge of what those processes are. This is the “the hip bone is connected to the thigh bone” stuff. You must have a GVMS; you must have a GMR; you must have it in this place at this time or it is not happening. We spend a lot of time doing that.
I take the point about how it is not the poor driver’s responsibility to have the correct documentation, and the driver does not know whether it is correct or not. They are given a packet of stuff and they just hope it is good. The issue is that we do not want the vehicle to be sent back. The only way they can do that is to force a process in there that makes sure that does not happen. My argument is that the GMR is that process. We already have a process; we do not need smart freight as well, which is a bit of an oxymoron, really. It is not a process that particularly solves anything.
Option one on smart freight is, “Are you empty?” If you say, “Yes”, it says, “Okay, you are good to go”. “That will do me”. We originally said, “Everyone will be empty”, and they said, “They will not do that”. They will do. With the greatest respect to trucking companies, they will go for the path of least resistance. That is how they operate. If you can press a button that gets you a Kent access permit, that is what you will do. There is an awful lot of training required at all levels, but it is not the same training. The sequencing of events is more important.
Stephen Kinnock: Anna, I see you would like to come in there. You have mentioned the IT issue a number of times. My understanding is that hauliers are going to need to navigate 10 different IT systems. Is that right? Is it feasible to get people trained up and understanding 10 different IT systems? Please do also come in on the point you wanted to make separately.
Dr Jerzewska: I obviously agree with Robert, but I just wanted to make a distinction here, because I do not think this is necessarily understood. What Robert said about training people in sequencing, what happens at the border and what the processes are is one area where we need training. Robert and Richard mentioned customs data earlier, the data that needs to go into all these forms and so on. That is another area where we need training. Every element of this dataset is something that is governed by international rules and customs rules. That also requires training. That is also a type of training where you need experience, not only classroom training. You actually need experience. These are two separate areas that both require some experience and a lot of training.
On the IT systems, yes, that is one of my main concerns at the moment. We have heard about these 10 IT systems. I am not necessarily sure what the 10 are. I know there are two systems, the GVMS and the Smart Freight Service. There is a new system for SPS requirements. There is a new system for Northern Ireland. There are supposedly a couple more in addition to all the systems that are already used, such as port management systems and so on.
The problem is that a lot of them do not exist. As Richard said, we have not seen them; we do not know what their functionality will be. Training people to use systems is one issue. Yes, as you pointed out, that is going to be a problem. There might not be enough time to get everyone on board, depending on who the users need to be. The other thing is that we all know how systems work. We all know how long systems take to develop. We have all heard of large Government IT projects. There are going to be delays. That is not being negative about the whole process; it is just that there are going to be delays. That is how large projects work.
Stephen Kinnock: That is the reality, yes.
Dr Jerzewska: That is the reality of it. They have a backup for an IT system being another IT system that is possibly simpler, because the Smart Freight Service is supposed to be a web portal, but it is nonetheless something that needs to be designed, someone needs to scope it, someone needs to test it and so on. That is definitely an issue. There is no backup system that would allow this process to function if there is no readiness on 1 January. Yes, the IT systems are definitely an issue.
Stephen Kinnock: I just had one question to all of you, as my final question. It is a little bit of an unfair one, but these three words, “chaos in Kent”, have been mentioned by you here on the panel today. I know it is very unfair to do this, but if you were to go from a 0% chance of chaos in Kent on 1 January, being, “It is going to be fine”, through to 100% chance that there is going to be chaos in Kent on 1 January, what ranking would you give from zero to 100 in terms of the percentage chance we are going to have chaos in Kent from 1 January 2021? Richard, I saw you wanted to come in and say something else. Do that, but if you could give your percentage that would be very helpful as well.
Richard Burnett: Of course, yes. I just wanted to talk about training very quickly. In my career, I have run lots of logistics operations and I have had to implement systems. When I implemented SAP, for instance, as a system, it has been two years in the making. That is about a business change process. What we are going through here is a business change process but on a scale like we have never seen before.
You go through those different handshakes. You train the individuals; you understand the system functionality; you have super users who will go and train people: they will train the trainers and then train other people. We do not have that infrastructure here to be able to naturally train out what we need to do. The scale of the training and the time we have is a challenge.
In terms of my gut feeling as we stand here today with 81 days, given the amount of work we have to undertake, I would say I am 80 20 for the potential for chaos in Kent.
Stephen Kinnock: That is an 80% chance of chaos.
Richard Burnett: Yes, because if businesses try to dispatch because they do not have customs agents to do the paperwork, the chances are that they are still going to want to trade. They are still going to want to drive volume there. If we are not ready, then the likelihood is that we will have chaos.
Robert Hardy: This is the chaos register. It is really unfair, Stephen. I am a Kent guy. The people in Kent are worried. It has huge potential for delays. It is more than 50 50. There is more than a 50% chance that there will be delays in Kent. I know the alliteration of “chaos in Kent” is nicer. I am not sure it will be chaotic, but it will not be good. The fear is that it will snarl up domestic traffic that is delivering or collecting in Kent. It also snarls up the empty trucks going back, and it also snarls up the prepared trucks. I kind of agree that there has to be some penalty or cost of not being prepared, because that is the only way people will come back next time prepared. If somebody is not prepared, we can probably live with that, but snarling up the prepared ones is a really sad outcome.
Stephen Kinnock: Finally, to Anna, what would your estimate be?
Dr Jerzewska: Yes, I would agree it is probably 70% to 80%, at least in the short term. As Robert said, businesses will find a way to trade. They will find the path of least resistance. Once penalised, they will probably come back ready the second time, but in the short term, in the first couple of weeks, that is definitely very likely.