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Haulage and logistics industry klaxons sounding over inadequacy of governments efforts to help boost customs capacity ahead of 1.1.20. “Flawed” and “complacent”. Here’s why... 1/thread. https://on.ft.com/3gchGnZ
The govt announcing £50m extra funding to stimulate market in customs "intermediaries" that will be needed to handle 215m new declarations per year. But we need 50,000 new customs agents. So that works out at £1,000 a pop. Not enough. But oddly money isn't the biggest issue./1
Throwing money at the problem isn't really the answer, even if it helps a bit, because freight forwarding is an industry, like any other - it needs cashflow and confidence (of which there is very little) - and it expands organically, not by edict. /2
The failure of government to engage in many of these most basic issues - to listen - is frustrating the industry deeply, as several leading figures tell me this morning.
Like Richard Burnett @RHARichardB of Road Haulage Association. "Flawed" and "complacent". /3
Like Richard Burnett @RHARichardB of Road Haulage Association. "Flawed" and "complacent". /3
Industry has been trying to engage with government on basic points - like what to do about companies who have hit the rolling 200,000 euro cap no State Aid because of Covid-19...but still need a way to access grant support. /4
As @BobSanguinetti CEO of UK Chamber of Shipping says, industry needs "greater co-ordination with businesses and for government to listen more closely to the views of industry" if we going to keep the show on the road come 1.1.21.../5
Because we know, as @marco4gione the DG at The Institute of Export and International Trade tells me, there will be a shortage of those capable of filling these complex forms - we need an estimated 50,000 more trained people - but we're miles short./6
Indeed as Robert Windsor the exec dec at @BIFA the International Freight Forwarding body tells me, a lot of their members have #COVID19 hiring FREEZES on...capacity has been shrunk or mothballed these past months NOT augmented! /7
He tells me that a lot of companies simply wont take on new clients that had no experience of customs procedures, because the risks and liabilities could be too large - because recall liability rests with importer/exporter NOT the forwarder /8
That means that companies that trade with the EU will need to develop in-house expertise to protect themselves - because even if they can get an agent, they are likely to be pretty inexperienced too. /9
So then we get back to this organic growth point.
The grants aren't big enough for many smaller operators to take the plunge.
I called a bunch of them yesterday and I started to understand the psychology....stay with me. /10
The grants aren't big enough for many smaller operators to take the plunge.
I called a bunch of them yesterday and I started to understand the psychology....stay with me. /10
So govt needs a big expansion, it is throwing £50m at the problem, but if I have company with 10 customs agents, all working to capacity, I'm making good living...do I rush to hire 20 more to meet future EU-UK "rush"....or do I wait and see how it all pans out? /11
My calls y'day point to the latter approach...in the current climate investing in new computers/software (often on 3-4 year contracts) and taking on new people with no revenues guaranteed is not something people are rushing into, particularly if they're handling new business/12
There is, for eg, going to be a massive amount of food/agri related business as a result of #Brexit...but that's a whole new specialist trade? And will it continue as now in Ro-Ro ports? There are those like Mr Windsor who doubt that. He sees consolidated loads, not mixed ones/13
Indeed, given the cost and complexity of the form-filling (just go read the Border Operating Model) there are those who believe a lot of small business will just stop trading with EU...maybe that's right, maybe not. But the *uncertainty* doesn't have people rushing to invest/14
All of which is to say that the market isn't (initially) going to solve the government's problem here, which to avoid a customs broker supply crunch on 1.1.21....which is why, if I was govt, I'd be listening very carefully to industry, not annoying it. ENDS
