MPs fear food and chemical industries face Brexit disruption

The Government’s environment and trade departments face an “impossible challenge” to get ready for Brexit and have failed to develop a clear plan to meet it, the House of Commons Public Accounts Committee (PAC) said.

In a report published today, the committee warns that the two departments’ preparations were being hampered by “pervasive uncertainty” about the nature of the UK’s future relationship with the European Union.

It said that “slow decision-making” by the Treasury on funding the extra bureaucratic costs imposed by Brexit was standing in the way of effective preparation.

Both Michael Gove’s Department for Environment, Food and Rural Affairs (Defra) and Liam Fox’s Department for International Trade (DIT) were “optimistic” in evidence to the PAC inquiry about being ready by March 2019 to deliver whatever comes from negotiations, but the committee said it was concerned about how realistic their plans were.

Defra and DIT may feel the 21-month transition period agreed in March gives them “some breathing space”, but it “does not mean they can take their foot off the gas”, said the committee.

Both Defra and the DIT are still having to prepare for the possibility that Britain will leave without a transition, or with no deal at all.

In a letter to the committee, the Department for Exiting the EU’s top civil servant Philip Rycroft revealed that Whitehall ministries were working on 325 “workstreams” to prepare for Brexit.

Defra alone was working on 64 areas, ranging from import controls on animals and animal products to the authorisation of new chemical products, and the committee heard that it could use “manual workarounds” if new IT systems are not ready in time, an exercise the committee said would be “costly and embarrassing” and could impede imports and exports.

It warned: “There are substantial risks, including disruption to the agri-food and chemical industries, if Defra’s IT systems are not ready in time. With only a year to go until the UK leaves the EU, and in light of Defra’s poor track record in implementing new IT systems in the past, we have concerns over the potential for disruption to the agri-food and chemical industries.”

It is unrealistic for Defra to pursue its planned £138m efficiency savings, the committee said, as it asked Defra to make clear what other priorities it will scrap or scale back to free up resources for Brexit preparations.

“Both departments have an impossible challenge and don’t have a clear plan of top priorities,” the report states.

Committee chairwoman Meg Hillier added: “The clock is ticking and there is still no clarity about what Brexit will mean in practice. ”

A government spokesperson insisted a clear plan for Brexit had been set and that “real progress” had been made on its delivery, adding: “Work is being undertaken across the whole of government, in a range of exit scenarios in preparation for our withdrawal from the EU. Close collaboration between departments is vital as we negotiate our exit from the EU and develop our future trade policy with the world, and Whitehall is rising to the challenge.”