Refusing to ask for an extension beyond the end of this year amid the coronavirus crisis would be ‘irresponsible’, says freight forwarding chief.
UK forwarding representative body the British International Freight Association (BIFA) has joined calls for an extension beyond the end of this year to the UK’s Brexit ‘transition period’ following the UK’s departure from the EU, and hence an extension to its current trading arrangements, because of the difficulties posed by the COVID-19 pandemic.
BIFA director general Robert Keen said that it “in light of the massive disruption to supply chains being caused by the coronavirus crisis, it would be irresponsible of the UK government to try to abide by the timetable for ending its Brexit transition period”. With negotiations between the EU and UK now stalled, he believes that if the UK does not seek to extend the transition period, it will not have the time to negotiate a deal that covers anything more than the bare minimum of trade arrangements.
Keen stated: “The government is still insisting it will not request an extension, saying the December 31st deadline is enshrined in law; but whilst Boris Johnson might insist that Brexit is done, we know from our regular meeting with government departments that there is a huge amount left in the civil service’s EU exit in-trays, and everybody is completely overwhelmed with the crisis.
“I understand that requesting an extension would be very difficult politically for the government, given the prime minister’s insistence that the Brexit process would not be delayed further, but true statesmen act in a statesman-like manner in times of global crisis, which is where we are now.”
Keen said BIFA members, which are responsible for managing the movement of a large proportion of the UK’s physical international trade, “share the uncertainty of others about how the coronavirus crisis will affect international trade in future”.
He added: “I, for one, wonder whether countries will remain committed to just-in-time global supply chains in trade, once this crisis is over, whenever that might be. And whenever it might be, it will not be a good idea to present business with a whole new set of uncertainties around a very significant change in the status of our economic relationship with Europe, either through no deal or through a very limited deal at the end of the year.”
Keen insisted that this was “not an argument about leaving the EU. That is done and dusted. This is an argument about managing the transition process when not just the goalposts, but the entire playing field has moved.”
He continued: “Pre Covid-19, it is true that our members faced a situation with more time to prepare for a potential no deal. Now, those members have been knocked sideways by the virus, and will be less well placed to adapt to a second shock if there is significant change in the terms of trade with the EU at the end of the year, because the government has stuck to its guns over the transition period.
“The crisis caused by Covid-19 is delivering much greater understanding of the key role of freight forwarders to the authorities and the wider audience that rely on the commodities being delivered through international supply chains. Now in these very difficult times, it is important that the government listens to the freight transport sector, puts politics to one side and seeks an extension to the transition period.”
BIFA’s comments follow a similar call yesterday by the UK’s Freight Transport Association (FTA) for an extension to the UK’s Brexit ‘transition period’. FTA said the challenges posed by the COVID-19 virus “will make the effective implementation of any new Brexit legislation impossible in the short term”. As a result, FTA said the freight transport and logistics industry was “petitioning government urgently to seek an extension to the current transition period for leaving the European Union, as well as suspending other planned domestic legislation which will impact the logistics sector”.
Elizabeth de Jong, policy director at FTA, also insisted that this was not about the relative merits of Brexit, nor any trading arrangements which the freight sector will need to adopt, noting: “This is purely and simply so the businesses tasked with keeping the UK’s supply chain intact can concentrate on the serious issues which the COVID-19 pandemic is placing on the industry.
“Logistics is facing unprecedented challenges, both in terms of keeping the UK economy supplied with all the goods it needs to function, as well as coping with the increased disruption to staffing levels caused by sickness and self-isolation and concerns about the viability of their businesses. Our first priority is always to deliver for our customers, and there is simply not enough capacity available to plan the major structural changes needed to implement a successful departure from the EU, as well as the myriad of other planned legislation changes on the horizon, as well as dealing with unprecedented pressures caused by COVID-19.”
In addition to requesting an extension to the Brexit transition period, FTA is also asking ministers to consider suspending the implementation of other legislation which will affect logistics operators in the short term. This includes the expansion of the London-wide Low Emission Zone for HGVs and the London Direct Vision Standard due to take effect from October this year, as well as the start of other Clean Air Zones around the country, in areas including Birmingham and Leeds.
“All this new legislation, and new trading arrangements, need careful planning and implementation in normal circumstances,” continued de Jong. “But it is clear they would bring major change to our sector at a time when we are fully committed to overcoming the challenges which COVID-19 presents.
“In addition to the administrative, practical and financial difficulties experienced by our sector, the pandemic will undoubtedly have a significant impact on supplies of new equipment, technology and vehicles in the coming months, as well as the industry’s ability to recruit and train new staff. Add in the challenge of adapting to new trading arrangements with the EU – which are yet to be formalised – and the situation is placing logistics under huge and unnecessary pressures.
“Logistics is a flexible industry, but such significant change cannot happen overnight, and there is simply not the capacity for planning and delivery of new legislation at present within the system. COVID-19 has created a once-in-a-lifetime emergency situation which needs the full attention of the whole sector – adding in a host of new legislation would place untold, unnecessary pressure on a supply chain that is already stretched. Our industry needs the support of government, not to be broken by it.”
Source: Lloyd’s
