View from the Chair

Long term solutions and support required

26th Jan 2021

Businesses are now almost four weeks into working with new customs and international trade procedures, and it is starting to become clear how the new changes are affecting companies here – with additional administrative work and delays being some of the key issues raised to date.

There is no doubt that businesses have had to deal with a significant amount of information passed to them in a very short space of time. They have had to assimilate it and then apply it to their organisations.

And whilst the UK Government has recognised some of these key challenges, such as those around groupage (where goods from different companies, for different customers are grouped together on one lorry), issues such as this have led to GB hauliers facing so much additional paperwork that they are refusing to take loads into Northern Ireland in some instances.

And whilst trade processes need to be simplified to overcome this, there is also a requirement for greater understanding about the current arrangements. Some firms from England, Scotland and Wales are also being put off shipping goods to Northern Ireland as they simply aren’t prepared and do not understand the new responsibilities. We must therefore find long-term solutions to these issues.

At the same time, concern is now focusing around the end of the grace period offered to firms here, where derogations on export health certificates will end on 31 March. This will see the ending of a ‘soft-touch’ approach that was negotiated with the EU for regulating supermarket goods transported from the rest of the UK, following the end of the transition period. Most concerning is that these challenges also come at a time when businesses here are also having to deal with the ongoing issues brought about by the COVID-19 pandemic.

Last week’s confirmation that the current COVID-19 restrictions are to be extended until 5 March will not have come as a surprise to businesses. Undoubtedly, the tighter and more prolonged restrictions which many businesses are currently coping with will weigh even more heavily on the key drivers of growth and indeed survival, in the months ahead.

And while we absolutely support the need to protect public health, there is now a twin obligation on government to safeguard our future economic health too. Our QES results for Q4 2020 show that one in five members feel their business cannot survive continual changes in the government’s COVID-19 policy responses. That is a staggering prospect and there is an urgent responsibility on the UK government to provide long term plans which allow businesses of all shapes and sizes to plan ahead. NI Chamber has therefore stressed that there is need for a clear support package from government for the whole of 2021, not just another incremental intervention. The current drip-feed approach to business support measures is too short term.

Last week the Finance Minister announced the Draft 2021-2022 budget which is currently out for consultation until 25 February. Already, there is concern that it will not be sufficient to cover the level of post-COVID, post-Brexit support that the private sector so urgently requires. There are many demands on this budget, not just in terms of immediate support for business, but also investment in areas like infrastructure, which will be central to our long term economic recovery and prosperity. While we must all be very realistic about the financial resources available to tackle the scale of the problem, it goes without saying that increases to budgets allocations for Economy and Infrastructure would provide some much needed impetus. It is also disappointing that it is another annual budget, which clearly limits forward planning and increases risk.

These are things that we have and will continue to stress to the Finance Minister and his Executive colleagues, because we know that a vibrant private sector can, in turn, fund world class public services. That is the position we all want to get back to.