The Builders Merchants Federation has echoed warnings from the House of Commons public accounts committee that HM Revenue & Customs is not yet ready for the five-fold increase in red tape that a no-deal Brexit would bring.
Under current plans, the UK is set to leave the European single market and the customs union in March 2019. If HMRC's new Customs Declaration Service is not ready in time, there could be chaos, MPs on the committee warned.
In 2015, around 55 million customs declarations were made by 141,000 traders. The UK's exit from the EU could see the number of customs declarations which HMRC must process each year increase five-fold to 255 million. A failed customs system could therefore lead to huge disruption for businesses, with delays potentially causing massive queues at Dover and resulting in food being left to rot in trucks at the border, the public accounts committee said.
Builders Merchants Federation chief executive John Newcomb said there would also be an impact on the construction industry. “We agree that a failure to sort out the Customs Declaration Service in time would be catastrophic for the building materials industry,” he said.
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“Builders merchants are already facing significant material price rises due to currency fluctuations and, from our engagement with government so far, we have concerns that proper consideration is not being given to other obstacles that may hamper trade.
“For essential building material supplies, such as timber, a failure from the government to deliver a viable customs system could mean very severe delays, extra costs, administrative burdens and shortages that threaten the building of new homes that we so desperately needed.”
Public Accounts chair Meg Hillier MP said: "Failure to have a viable customs system in place before the UK's planned exit from the EU would wreak havoc for UK business, trade and our international reputation. Confidence would collapse amid the potentially catastrophic effects.
“HMRC is under considerable pressure to deliver the new Customs Declaration Service in time, but it does not yet have funding to increase the capacity of CDS to deal with the consequences of Brexit—nor to develop contingency options. This is deeply worrying.”
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