Christopher Booker:
Ever longer grows the list of potential disasters that lie ahead for Britain, thanks to Theresa May’s decision that, on leaving the EU, we should also leave its single market. But rumbling away now in the background is one that dwarfs them all, because it will affect every one of the 170,000 UK businesses that trade with the rest of the EU, and much else besides.
We are, of course, wearily familiar with the argument that, because the rest of the EU sells more to us than we do to them, they will happily concede us that “one-off deal” Mrs May wants, allowing us to continue trading much as we do now. But this relies on a complete failure to grasp the real nature of the regulatory system that is the essence of the single market, and what would be facing us if we leave it to become what it calls a “third country”.
We would be excluded from that fully computerised system which for 25 years has allowed us to trade with the rest of the EU without having to go through customs controls. Only our trade with the outside world has been governed by a system called CHIEF (Customs Handling of Import and Export Freight), designed to handle 50 million customs declarations a year.
As long ago as 2010, HMRC realised that this system would soon be hopelessly overstretched. By 2014, when they had already been working for four years on upgrading their software, it became clear that they would now need a new system to be compliant with the proposed new EU-wide Union Customs Code, covering 1,300 pages. An £87 million project to create a new Customs Declaration Service (CDS), capable of handling 90 million declarations a year, proved so tricky that this was unlikely to be in place before 2020.
But all this has now been totally changed by Mrs May’s decision that we are no longer to remain “within” the internal market as she earlier promised, and as we could have done, on leaving the EU, by remaining within the wider European Economic Area (EEA). As a “third country”, Britain will now have to create its own unique customs code from scratch, to cover not only trade with the outside world but that with the EU as well, And obviously work on this cannot seriously get under way until the details of Mrs May’s trade deal are finally agreed.
I asked HMRC how long this might take, since they have already spent three years in dealing with a very much smaller problem. Their reply notably failed to answer the question of how they are planning to face this colossal new challenge. Indeed, it is inconceivable that, on day one after leaving the EU, we could have in place our own wholly new system, which it is estimated would now have to handle 350 million or more customs declarations a year.
This would result in chaos on an unimaginable scale (much of which, of course, could have been avoided if Mrs May had not been talked into leaving the EEA by her fluffy-headed colleagues). The disruption to our trade, not least the 30 per cent of all our food that we import from the EU, would not just be a car crash or a train wreck, it would be a whole fleet of jumbo jets crashing down on our entire economy,
When the Prime Minister shortly confronts her 27 EU colleagues to trigger Article 50, they will be gazing at her in disbelief that she could be asking for anything so silly: that would be a catastrophe not just for Britain but for the rest of the EU as well. Margaret Thatcher in 2003 famously looked back on our decision to join “Europe” as having been “a political error of the first magnitude”. But entirely through our own ignorance and stupidity, it looks as though the way we are choosing to leave it could be even worse.