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Business Support: Transition Period

Volume 677: debated on Wednesday 24 June 2020

What steps he is taking to support businesses in Northern Ireland in preparation for the end of the transition period. (903601)

I am working closely with businesses across Northern Ireland to ensure that they are ready for the end of the transition period, which will come at the end of December this year. The first business engagement forum meeting was held on 10 June, and my officials continue to engage in detailed technical discussions, as we did before that and as we will continue to do.

The Prime Minister continues to insist that Northern Ireland businesses can simply throw customs exit declarations “in the bin”, while Michel Barnier continues to insist that this would be incompatible with the UK’s legal commitments. The Secretary of State says that consultations are ongoing, but does he not see that this cannot drag into the autumn? Business needs clarity now, given that preparation for a no-deal exit takes months. If he cannot provide that, he owes it to business to extend the transition period until proper answers are found.

We will not be extending the transition period; we have made that clear. On the wider point, we will set out more detailed plans for extensive support from Her Majesty’s Revenue and Customs for Northern Ireland businesses that will be engaging in the new administrative processes, and we will issue that guidance this summer. I shall be clear, as I have been previously at this Dispatch Box: Northern Ireland businesses trading with the rest of the UK are part of the UK customs territory. They will have unfettered access.

On that point, are the Government actively seeking a waiver from the EU to prevent the need for customs declarations on goods being shipped between Great Britain and Northern Ireland? How advanced are such discussions, if they are taking place?

We continue to take forward discussions on the implementation of the protocol in the Joint Committee and in the specialised committee, as the right hon. Gentleman is aware. As we set out in the Command Paper, we will discharge our responsibilities in a way that is effective, that upholds our international obligations and that respects the unique circumstances of Northern Ireland. Provisions must include the minimum possible bureaucratic consequences for businesses and traders, and we will respect what we promised, which is unfettered access.

I thank the Secretary of State for that response. Are the Government promoting a trusted-trader scheme, particularly for key retailers such as those that operate between Great Britain and Northern Ireland? What discussions about that has the Secretary of State had with the business engagement forum?

We are working with Northern Ireland businesses and the Executive to ensure that any new administrative procedures are streamlined, avoid any unnecessary burdens and do not affect any flow of trade. There should be no tariffs on internal UK trade because the UK is a single customs territory. For example, a supermarket delivering to its stores in Northern Ireland poses no risk whatsoever to the EU market. No tariffs would be owed for such trade. The principle needs to be formalised with the EU in the withdrawal agreement Joint Committee. We are talking to businesses, including via the engagement forum and other opportunities, to explore proposals to make sure that we maximise the free flow of trade.

Hello from Dorset. My right hon. Friend knows that Northern Ireland businesses want to prepare to make Brexit a success; the problem is that they do not quite know what they are preparing for. In reflecting on last week’s Select Committee hearing, is my right hon. Friend persuaded of the merits of providing stepping-stones between now and 31 December, so that business knows what to prepare for and in what timeframe?

As I said, we are working with Northern Ireland businesses and the Executive to support preparations for the end of the transition period at the end of this year. As we engage, including through the business engagement forum that we have already established, we will set out further details to help businesses to prepare for the end of the transition period at the earliest appropriate moment. I assure my hon. Friend that further guidance will be published this summer to make sure that people and businesses know what they need to do to prepare for the end of the transition period, which will be at the end of December this year.

An HMRC whistleblower recently warned that the new customs declaration service system is not only delayed but does not talk to other HMRC systems, some of which are 20 years old. With criminal organisations and smugglers ready to take advantage of any gaps in systems, how confident is the Secretary of State that this IT solution will work and provide proper controls to prevent businesses and the Treasury from losing millions of pounds in tax?

I am very confident that HMRC will be able to provide the support and the work that business needs to be ready for when we leave the European Union’s transition period at the end of December this year.