NEW. Unvarnished ⁦ @NAOorguk⁩ report highlighting govt failure to prepare for post-Brexit borders - warns “widespread disruption” likely. My latest via @FT. Stay with me.../1 https://on.ft.com/2TXRqEl 

You can read the 85-page public spending watchdog's whole report here, but it warns of

- insufficient customs brokers,
- unprepared border sites
- and a failure to build enough capacity in new customs software.

...and that this was forseeable. /2

https://www.nao.org.uk/wp-content/uploads/2020/11/The-UK-border-preparedness-for-the-end-of-the-transition-period.pdf

Remarkably it says that even by July 1 2021, the govt Border Delivery Groups finds "high risk" not all infrastructure will be ready...even at the end of UK's unilateral 'transition' period, which itself creates under-discussed second cliff edge. /3

On customs intermediaries it says the govt "has not yet facilitated the required expansion of the customs intermediary market" - and that this "could have been avoided" (a running theme of this report).../4

To recap HMRC estimates UK will do 270m declarations in 2021 - up from 60m today - and (see threads passim) the £84m the govt has spent just hasn't moved the market as they'd hoped, because of Covid +inertia + it takes 18 months to get a broker really trained /5

The Govt says that the situation is now "amber" not "red" (as it was 21.10.20 when report was done, and that it is "on track to have the right people in place with the right skills by the end of the transition period" - but I have to say industry does NO share that confidence /6

What about the computers needed to process all those 270m declarations?

Well, an audit in APRIL 2020 found that HMRC's new CDS customs system wasn't up to it and would need "substantial re-engineering" to copy, so we'll now plug along with a mix of CDS and the old CHIEF /7

As the NAO points out: "HMRC has known since it began its no-deal preparations in 2017 that CDS might need to handle a very significant increase in customs declarations." @Meg_HillierMP chair of @CommonsPAC says this is "completely unacceptable" and the cmme warned 3 years ago./8

The report also states that Govt now accepts that the new regulatory border in the Irish Sea - supported by the £200m will not be ready "and that the government was “exploring contingency options”. /9

More broadly, it warns that there is just no enough time for business to integrate with new systems like GVMS and SmartFreight (now Check an HGV) that is supposed to regulating traffic into Kent. As always, Whitehall slow to understand real-world implementation of bright ideas/10

So as Tim Reardon of @Port_of_Dover tells me, with the GVMS system for pre-declaring customs the problem is that "Who, precisely, needs to do what with what — and where and when do they need to do it — have still not yet been fully defined”. That makes it hard to prepare! /11

As, incidentally does Covid...with the NAO warning that the govt's civil contingency planning measures (on medicines supply etc) are likely to be harder to enact. Certainly the drug industry has raised concerns. /12

https://www.theguardian.com/society/2020/oct/06/nhs-faces-drug-shortages-as-brexit-stockpile-used-in-covid-crisis

None of this will come as a surprise to industry, which has been warning for months and months that they needed more time, but the government - having failed to prepare adequately - then decided not to extend the transition period. /13

As @RHARichardB tells me, industry is now "we have run out of time and business will just have to accept and face the challenges come January" - but the govt must take responsibility, he adds. /14

Ian Wright boss of the @Foodanddrinkfed which is super-exposed to Brexit wants compensation and more grace periods for business to adapt “[this] presents a genuine risk to the UK’s food and drink supply and the availability of products for shoppers". /15

All in all, a pretty sorry picture. We'll see how well prepared the EU are for the coming frictions, as we wind the clock back to 1992 and essentially apply RoW customs processes to high-speed freight lanes of EU-UK single market trade /16

Getting an FTA in place is going to help, for sure, though that isn't to minimise the size of coming change.

It may open door to more easements.

The UK govt will also have to throw money at the problem; and be flexible to keep show on road /17

The govt is urging business and citizens to get ready "so they know exactly what they need to do to grasp the new opportunities available as the transition period ends.”

That will feel like yet more Brexit Doublethink to a lot of industries right now. ENDS