The government has said it would be “wrong” to implement costly post-Brexit border checks in the summer while businesses battle rising inflation.
Checks on meat and plant product imports, due to commence in July 2022, will be delayed for the fourth time. They will be replaced with a “new controls regime” in 2023.
The move comes as figures show Brexit has resulted in a 25% fall in imports from the EU and created “a large increase in barriers to trade”, according to the London School of Economics.
The government said Russia’s invasion of Ukraine and rises in global energy costs have had a “significant effect on supply chains that are still recovering from the pandemic”. It said delaying additional border checks would save importers a total of £1bn in annual costs.
A Cabinet Office (CO) spokesperson said: “The government has concluded that it would be wrong to impose new administrative requirements on businesses who may pass on the associated costs to consumers already facing pressures on their finances.”
The CO said the government was reviewing how to implement the remaining controls in an “improved” manner, which would help protect consumers from rising inflation.
Jacob Rees-Mogg, minister for Brexit opportunities, said: “Today’s decision will allow British businesses to focus on their recovery from the pandemic, navigate global supply chain issues and ensure that new costs are not passed on to consumers.
“It’s vital that we have the right import controls regime in place, so we’ll now be working with industry to review these remaining controls so that they best suit the UK’s own interests.”
The CO said it would work with industry to help traders move goods globally more easily.
The Federation of Small Businesses (FSB) said the delay created “one less burden” for small firms.
Martin McTague, national chair of the FSB, told Supply Management: “Imposition of full import controls this summer would have meant yet another burden for small firms which are already wrestling with new trade rules and spiralling operating costs.
“This move will give them more time to prepare for future changes and reassess supply chains.”
McTague said the long-term goal of government should be to “minimise trade friction” and increase the threshold at which import tariffs are imposed.
Michael Schymik, international director of transportation and logistics group STEF Langdon, described current paper-based processes as “unsuitable in a 21st century digital world”. He said: “The decision may lead to a return of more EU companies exporting to the GB market, increasing competition and ultimately lowering prices for the consumer.”
Dominic Goudie, head of international trade at the Food and Drink Federation, told SM: “The pandemic, and now the war in Ukraine, have caused significant supply chain disruption for UK food and drink and are at the root of current inflationary pressures.
“In this context, while businesses have already spent a good deal of time and money preparing for the new border regime, we welcome the clarity today's announcement brings.”
However, a Confederation of British Industry spokesperson told SM it was concerned the change in policy could disadvantage UK businesses.
They said: “Reducing friction in supply chains already under strain post pandemic, and now the war in Ukraine, is understandable. Nonetheless, firms have used the time wisely to prepare for these changes and will be concerned that not applying checks disadvantages UK exporters at a time when trade is already acting as a drag on growth.”
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