The prime minister’s refusal to extend the Brexit transition period, despite the devastating effects of the coronavirus crisis in the UK and the EU, means that neither the government nor businesses will be fully prepared when the UK leaves the EU on 31 December.
With just eight weeks to go until the UK leaves the EU single market and customs union, regardless of whether a new EU-UK deal is reached, this report warns that:
- The Northern Ireland Protocol will not be ready to implement on 1 January 2021
- Disruption at the EU-GB border is inevitable due to poor trader readiness and EU checks
- The Covid-19 crisis means many UK firms are less prepared than they were last year
The prime minister’s refusal to seek more time to negotiate was always a high-risk bet that the UK could prepare for the inevitable disruption that would follow its exit from the EU single market and customs union.
But a continued lack of clarity over the Brexit talks makes this bet riskier with every passing week, with the rise in coronavirus cases demanding ever greater government and public attention and forcing most of the country back into lockdown.
The report says the government should learn from its initial handling of the pandemic and its 2019 no-deal Brexit preparations, and work closely – and share information more openly – with other parts of the public sector and devolved administrations.
- The EU should acknowledge that fully implementing the Northern Ireland Protocol by January will be almost impossible and be ready to show some flexibility.
- The UK government must prove that it will not renege on its international obligations. The powers taken in the UK Internal Market Bill have undermined trust. The first step should be removing the offending clauses.
- The government should consider light-touch enforcement or further delays to new import controls to minimise disruption at the border.
- The government should clearly communicate the practical impact of leaving the single market and customs union – in particular, the greater level of bureaucracy traders will face from the end of the year, deal or no deal.
- The government should work closely with business groups to identify where targeted economic support for firms affected by Brexit may complement its coronavirus economic response.