Government plan to axe no deal import tariffs savaged by all and no wonder

It is a stupid, panicked, ill thought out measure by a government lurching drunkenly towards a bridge over which an austerity wracked council has been unable to replace the railings

 

James Moore
Chief Business Commentator
Wednesday 13 March 2019 11:50
Comments
What does a no-deal Brexit mean?

Remember when Boris Johnson said f*** business? It now appears that the entire Conservative government has decided that will be its operating principle. You can add in f*** jobs and f*** prosperity.

I am, of course, referring to the decision announced this morning to scrap the majority of import tariffs under the the UK’s no deal plans - although I’m not sure dignifying anything as half baked as this with the word ‘plans’ really suffices - for a no deal Brexit. Some 87 per cent of them no less.

Before you say, but that won’t happen it’s just a bluff and it will be killed off by tonight’s vote, I remind you that no deal is still the default legal option. Whether it is formally cancelled depends very much upon the wording of the motion. It should also be noted that to get the extension of article 50 necessary to prevent it, something the CBI and many others have called for, the EU's member states will have to play ball and most of them are heartily sick of the UK government. Small wonder.

Parliament has, in theory, already voted against the option. But we are still having this discussion because the Spellman amendment that was supposed to kill it off was non binding.

The problem with the tariff plan, which we are told is to protect consumers from immediate and sharp rises in prices, is that there will be no quid pro quo. British goods going the other way will be subject to a range of brutal charges that they do not currently attract, not just from the EU but from a range of other countries with which it has free trade deals that we currently benefit from and that trade secretary Liam Fox has failed miserably to get rolled over.

UK plc was once a tolerably competitive economy. No deal will overnight make large swathes of it uncompetitive. How long exporting businesses that have already been operating with unprecedented uncertainty will be able to last in that situation is an open question.

Then there’s the situation at the Irish border. Let’s not forget that. “Our members in Northern Ireland are tearing their hair out,” said the one business group to me this morning. “Actually by now they probably haven’t got much hair left but you know what I mean.”

There’s also not much point protecting consumers if they don’t have any money to spend through loosing their jobs and there’s not much point protecting consumers if there’s nothing much in the shops to buy. Apparently there’ll be no customs checks to keep goods coming in. Again, temporarily. So good news for those concerning themselves with the importation of illegal drugs. Let’s face it, we might all need to get high to get through this.

Tariffs will still apply in areas like agriculture, because we mustn’t upset the Tory farmers in the shires. But that’s about it.

This is a stupid, panicked, ill thought out measure by a government lurching drunkenly towards a bridge over which an austerity wracked council has been unable to replace the railings.

But you don’t need me to tell you that. Business groups - none of whose members were properly consulted - basically said the same, albeit a little more decorously

Here’s Carolyn Fairbyn, the head of the CBI: “What we are hearing is the biggest change in terms of trade this country has faced since the mid-19th century being imposed on this country with no consultation with business, no time to prepare.”

CBI director Carolyn Fairbairn: no deal Brexit is a 'sledgehammer hanging over business'

Alan Renison, from the Insitute of Directors: “The belated, cack-handed way in which the Government has handled its no-deal planning is one of the main reasons why many businesses will not be prepared for this outcome by March 29th.”

British Chambers of Commerce director general Adam Marshall: “There has not been enough consultation, preparation or planning to support the firms and communities that could find themselves at the end of a sudden shift in tariffs.”

Let’s not forget the TUC, the members of which represent many of those whose jobs will be threatened. Director general Frances O’Grady weighed in with: “Ending all tariffs in a no-deal Brexit would be a hammer blow to our manufacturing industries and the communities they support. The government is flying blind.”

It is indeed.

Faced with that sort of thing, most governments would be inclined to stop and think, to put on the breaks, and call people in to talk. Apparently there’ll be some of that taking place today. It’s too little, too late.

If only Britain had a half decent opposition there might be an opportunity there. But it doesn’t. So fasten your seat belts.

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