UK ports are demanding compensation from the British government after a delay in implementing post-Brexit border checks by 18 months left them with empty high-tech facilities that risk becoming multimillion pound “white elephants”.
The move last week to delay checks on EU animal and plant products until at least the end of 2023 was announced just as many UK ports were close to completing government-ordered border control posts in time for border checks to start on July 1 this year.
UK Major Ports Group, a trade body for the largest operators, estimates that the industry has spent £100mn to construct the new border facilities, with an additional £200mn provided in post-Brexit government grants via the Port Infrastructure Fund.
“This now looks like wasted time, effort and money to develop what we fear will be highly bespoke white elephants,” the group said.
Last week, Brexit opportunities minister Jacob Rees-Mogg said the delay — the fourth time ministers have suspended the implementation of a full post-Brexit border — would save industry £1bn and help control the looming cost of living crisis.
However, in Portsmouth, where the port is local authority-owned, £24mn has been spent on a new border post, including a £7mn loan, after the government provided only two-thirds of the cost of building the facility.
Mike Sellers, director of Portsmouth International Port, said the facility had been constructed on the orders of the agricultural department Defra and that staff had already been recruited to run the facility.
“We now face significant capital liability on a building for which the future is uncertain,” he said. “This has always been raised as a concern with ministers and their officials and we will be pursuing compensation from the government as we look to recover costs.”
Stephen Morgan, Labour MP for Portsmouth South, accused the government of wasting public money.
“[The port’s] profits help fund local services and the impact of this unexpected and unfair bill will be felt across the city unless the government takes responsibility for its poor planning,” he wrote in a letter to Rees-Mogg seen by the Financial Times.
Ministers committed to introducing a new digital border by 2025 to reduce bureaucracy and speed up trade flows, leading to concerns in industry that the Border Control Posts may never be fully utilised.
A senior port industry executive said the delays now threatened a “worst of all worlds” where ports were saddled with expensive infrastructure but reduced levels of checks from which to recoup their costs, or the facilities had to be turned back into ordinary warehouses.
“What else are we going to do with new buildings full of massive fridges, medical-grade inspection facilities and secure communications rooms?” the executive said.
The government has said that it will engage with ports individually by May 12 to try to resolve issues, but port lobby groups called for an industry-wide solution rather than a piecemeal approach that reduced government liabilities.
Tim Morris, chief executive of the UK Major Ports Group, said the industry wanted urgently to get around the table with ministers.
“Whilst we appreciate the offer to engage individually with ports on a limited range of local mitigations, these don’t address the biggest issues — the recovery of investment already made and the future of the facilities developed,” he said.
The Cabinet Office said the government would continue to engage closely with ports following its announcement, and that the government’s new digital border strategy would reduce costs for businesses and consumers.
“Ports will benefit from streamlined processes and reduced congestion as a result of these controls no longer going ahead in July,” a spokesperson added.