Category: Brexit

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Part 1 Teesside Airport: “The People’s Airport is safe in our hands”

A S Hunter

During the years of economic decline in the North East, there was less inward migration here than elsewhere in the country. Figures from The Migration Observatory show that immigration into the North East was considerably less than any other region of the UK, and, in particular, migration of people from EU members states . It states that total migration to the region from EU member states was just 60,000. Of the English regions, the next lowest was Yorkshire and the Humber with 236,000. This, in turn, impacts on the amount of travel in and out of the region:

No deal, no good

Keith Burge

Get Brexit Done. The three-word slogan that won a General Election, turning red seats to blue in parts of the North East that had never seen the like in decades, if ever. And yet, here we are just over 12 months on, and that victory is not so much ringing hollow as sounding a death knell for crucial elements of the region’s economy.
According to ONS there are around 3,500 exporting businesses in the North East. The North East is unusual among the regions of England in having a trade surplus in goods. Exports account for a higher proportion of regional output than in any other English region (26 per cent).
More specifically, the North East relies disproportionately on the European Union as its largest export market. In 2019, around 60 per cent of the value of all North East exports went to the EU, significantly higher than the UK average of just over 48 per cent and indeed the highest of all English regions.
But as from 1 January 2021, everything changes. The Government is imploring business to ‘Check. Change. Go.’ Which is all well and good, apart from the minor details of being unable to tell them what to check, what to change and where to go. Of course, this will hurt businesses across the UK, but given the disproportionate reliance of North East exporters on EU markets, the region looks set to suffer more pain, in relative terms, than any other part of the country.
The North East Chamber of Commerce – which has been lobbying on behalf of and providing practical support to exporters for decades – recently hosted a ‘Brexit Support Week’, a series of 13 sessions on different Brexit-related topics that will impact businesses including new customs responsibilities, data regulation etc. These events attracted around 850 attendees, representing many hundreds of businesses, all of which want to prepare, have not had the information to be able to do so and see the cliff edge looming. It seems likely that many of them will each already have spent thousands of person hours making preparations for different scenarios, at a significant cost to their businesses. For the smallest exporters, lacking capacity and unable to make that sort of investment, it seems to be more a case of shutting their eyes and hoping they survive the impact. Ordinarily, many would rely on the expertise of freight forwarders, logistics providers and customs specialists, but their capacity is limited and a massive increase in demand has seen their prices increase markedly.
And of course, some of those attending these events will have been importers, trying to work out how they can continue to work with suppliers across the EU. It has been reported anecdotally that some are so fearful of disruptions to supply chains and higher costs brought about by a combination of a deteriorating exchange rate, the application of tariffs and an abundance of bureaucracy, that they have been trying to find alternative suppliers within the UK. Import substitution: that has to be a winner, no? Well, maybe, but then if it was such a good idea, why haven’t buyers done this already? The usual answer is quality and/or cost.
As an alternative, some manufacturing businesses whose operations rely on a continual supply of goods entering the UK from Europe, have been stockpiling goods. The cost of this additional warehouse space is another unwelcome burden.
And whilst businesses employing staff from EU countries face no immediate pressures in theory, in practice there are reports of some EU nationals opting to return to their countries of origin amidst the uncertainty (and, in some instances, to escape the toxicity of Brexit). Replacing lost staff or trying to hire additional staff from outside the UK using the new points-based immigration system may well be a daunting prospect for many employers.
Still, it isn’t as if businesses have had anything else with which to contend over the past 9 months.
So how might things look under a No Deal Brexit (or even a last gasp hard as nails deal)? Firstly, there is the bureaucracy. But that’s OK, say the champions of Brexit: businesses already export around the globe and are used to this. Except, many businesses who export to (and import from) the EU have no dealings outside the EU and so have never been exposed to the bureaucracy of non-EU international trade. According to the head of HMRC, the cost of all of this new paperwork will amount to £7.5 billion a year. A year! How much this will cost North East businesses is difficult to estimate, but will certainly run into hundreds of millions of pounds. A very high cost from which they will derive no benefit whatsoever.
Secondly, there are tariffs. Farmers will see the cost of their exports rise to unaffordable levels and demand collapse. Manufacturing and processing businesses face the double whammy of having to pay tariffs on imported components and raw materials and then seeing their final product having a tariff imposed upon it, thereby eroding their competitive position. For example, under WTO rules there are tariffs of 4.5% on car parts and 10% on cars. In its evidence to the House of Commons International Trade Committee, Nissan said that tariffs will add £500m a year to costs. It then has to try to absorb those costs, rather than pass them on in the form of higher prices, given that cars exported to the EU (its key market) become 10 per cent more expensive anyway.
And that’s not all of it. Which brings us to problem number three. The Nissan plant relies wholly on operating on a Just-in-Time basis. At any one time it holds a maximum of half a day’s stock and if it runs out of parts that is very serious. Honda reckons that an hour’s lost production costs it several millions of pounds. So why not stockpile? Build some warehouses? Toyota has said that if it built such a warehouse it would be the third biggest building on the planet.
Many businesses and their representative organisations have raised concerns about the digital infrastructure required post-Brexit. The fact that these are either set to be finished or upgraded in the next few weeks means that businesses will have very little time to get to grips with them. This increases the risk of mistakes being made and the associated problems that would then arise e.g. border delays and additional costs to businesses. Of course, anything that risks border delays presents a serious risk for Just-in-Time supply chains.
Fourthly, EU Rules of Origin require producers of final goods to include a minimum proportion of that item by value to be sourced within the EU. With the UK outside of the EU that means UK manufactured components no longer count. Anecdotal evidence suggests that UK suppliers are already being excluded from supply chains in favour of EU27 suppliers who enable producers to continue to comply with EU Rules of Origin. A trade deal may or may not have been able to address this; a No Deal Brexit certainly will not.
So, all in all, pretty terrible. Oh and I nearly forgot: all of this uncertainty has meant that new investment – especially from international investors deciding whether to invest further in their North East-based plants or place investments elsewhere – has stalled. Of all English regions, the North East has the highest percentage per head of jobs created by Foreign Direct Investment, with overseas-owned firms employing tens of thousands of people across the region. If there are two things international investors hate they are uncertainty and instability.
And if you’re looking for flowers – as a mark of sympathy or to cheer yourself up – that too might be problematic. Of all flowers sold in the UK, 70 per cent come from the Netherlands and are delivered fresh every day. In the first three years after the EU Referendum 1900 florists closed, seemingly due to the 20% devaluation in Sterling caused by Brexit which made importing unaffordable. After 1 January, the deliveries won’t even get through.
Photo – Tyne and Wear Archives and Museums wikimedia

BREAKING

Sunderland residents protest over No Deal Brexit

Louise Brown

Nissan’s Chief Operating Officer, Ashwani Gupta, has repeatedly said that the plant in Sunderland would be unsustainable with a no deal Brexit. He also stated they need a Brexit deal with a sustainable business case for their UK commerce to be viable. Mr Gupta said that the EU was Sunderland factory’s biggest customer and warned that Nissan’s commitment could not be maintained if there was not tariff-free EU access.

Boris Johnson’s blame game

Giuseppe Bignardi

Fishing is a sticking point in the Brexit negotiations. The UK has rejected an offer to reduce the EU states fishing quota by 15-18%. Fishing is of relatively little importance to the UK (0.1% of our GDP) but it has become a symbolic issue. Our government wants an exclusive right to set fishing policies as a demonstration of UK sovereignty.

The pandemic of violence and what to do about it

Julie Ward

So what can we do to stem the tide of gender-based violence apart from the usual petitions and letters to MPs? We need a system change across society starting with sex and relationship education so teachers and school governors should work together to implement age appropriate lessons. We need to increase women’s visibility across all sectors at the highest level, which means empowering girls to study STEM subjects and encouraging women to stand for election at every opportunity; it is heartening that we already have women police and crime commissioners in the region with more women standing in the forthcoming elections.

A mind to extend?

Colin Gordon

The tale is that stories, or scares, about possible attempts to extend the Transition have been coming out of the ruling Vote Leave faction in the centre of government. This faction, or some of its members, have been having an internal soap opera/meltdown moment and (ostensibly) losing some key personnel to the grey area of ‘working from home/gardening leave’.

Left in the dark, left in the cold: why charities and social enterprises are worried about the replacement for EU funding.

Michal Chantkowski

The mainstream government funded support schemes, such as the ‘Work and Health’ and former ‘Work’ programmes are widely criticised for multiple reasons. They appear to be focusing on low hanging fruit, on clients who need little support in order to progress, while putting minimum effort into supporting those with complex needs or facing multiple issues, and at the same time channelling money into multi-nationals and corporations and Tory donors instead of supporting charities and social enterprises.

Protest at the Port of Tyne on the eve of deadline for Brexit talks.

Louise Brown

“With the EU summit on 19th November being seen as the deadline for a draft Brexit Deal, a protest took place at the Port of Tyne. This was to highlight the difficulties we will face importing and exporting goods into and out of the UK, if we crash out without a deal or if a bad deal is secured. We cannot necessarily rely on a trade deal with the US either to bail us out because Biden has stated for this to happen the Good Friday Agreement needs to be respected which is not scheduled to happen with the Internal Markets Bill. With less than 50 days to go before the transition period ends, let us not forget that the North East stands to be the worst affected by a No Deal Brexit.”

Resisting the far right in the North East

Stephen Lambert

There remains a real danger that UKIP or even Nigel Farage’s re-launched Brexit Party into the new Reform Party could become more racialised. If Boris Johnson’s Brexit strategy and programme fails to deliver in the North and Midlands, these parties could enjoy a future resurgence in the region’s urban towns and coastal communities. They already hold a number of council seats in both Hartlepool and Sunderland, and they polled well in local elections in Newcastle’s east end.

Opinion

Johnson’s Groom of the Stool skips out of no.10 …

Scott Hunter

Witness, for example, the hesitation of the government earlier in the year to initiate a lockdown. Did we hear cautionary voices saying “the British will not acquiesce in this, they love their liberty too much”? (you certainly found them in the Spectator). But when the lockdown came, people just got on with it, clapped along, and failed to rebel at all (at least not until the famous incident at Barnard Castle.) So, when people started to become cynical about lockdown, who was behind it?

Logics of corruption: the UK state response to the Covid-19 crisis

Colin Gordon

A common theory is that the disaster of Covid-19 suits the UK Brexit regime’s interest by distracting from and/or explaining away the disaster of hard Brexit – a kind of a gigantic diversionary narrative or ‘dead cat’ tactic. This could, incidentally, imply that the regime has no particular interest in managing the pandemic, as long as it can avoid or divert blame for its failure.

Poetry Corner

From Peterloo to Tolpuddle

Harry Gallagher

From Peterloo to Tolpuddle, Jarrow to Orgreave, there’ll be no further uprisings today sir, we read the press, know what to believe. The daily tales spin an almighty weave about who’s to blame, wouldn’t you say sir from Peterloo to Tolpuddle, Jarrow to Orgreave. We’ve learned when to smile, when to grieve and follow our […]

Know your rights

Julie Ward

The attack on our rights can be seen in a global context whereby a plethora of rights are under attack from right wing illiberal governments. However, that this should be happening in 21st century Britain is a shock for many who always thought the UK was less prone to the populist agenda of ‘taking back control’ regardless of the self-harm that might be inflicted and the freedoms and progress that might be undermined.

Opinion

How bad recipes are deflecting attention from truthful debate

Louisa Britain

All in all, I would imagine you might just about be able to cover the full cost of this for ten pounds, if Aldi does sell a small chicken for £2 at all. Not being near enough to Aldi myself to just pop in, I rely on memory, which suggests that £3-4 is more likely. There are utensils to factor in. Do you have roasting tins, a stock pot, a reasonably good knife? Come to think of it, do you even have an oven and a hob?

Lucy’s story

Louise Brown

With Lucy’s freedoms curtailed in so many ways she, and many other young people, are certainly having a tough time of it at the moment. With no nights out with friends allowed to ease the pain it’s going to be a long hard winter. Let’s hope Boris Johnson considers this during the current crunch time Brexit talks and gets a good deal for the sake of everybody but especially our young people.

No deal or a bad deal?

Richard Corbett

A minimalist deal would be a bad deal. Anything that reduces our access to the single market for our exports and our supply chains (including for food and medicine), to Europol and police co-operation, to EU research programmes (especially medical research), to cross-border road haulage permits, to the EHIC health insurance card for travellers, to the ERASMUS student exchange scheme, and to much else, would be damaging to Britain, destroying jobs, reducing security, and inflicting red tape and bureaucracy on businesses and citizens alike.

BREAKING

Covid hit businesses call for pragmatic approach to secure historic UK-EU agreement – CBI & trade associations

Yvonne Wancke

The CBI and 71 trade associations and professional bodies representing 190,000 businesses and seven million employees are calling for politicians on both sides to carve a path towards a deal. Sectors from automotive to aviation, chemicals to creative industries, and farming and food to pharmaceuticals – are united: securing a quick agreement matters greatly for jobs and livelihoods

Boris needs to do his homework!

David Taylor-Gooby

A CETA deal would not stop border checks of tariffs on some goods. There would still be checks at borders. If you want to see what this is like, travel to the southern border between Montenegro and Croatia south of Dubrovnik. The queue of lorries being checked, not just for what goods they are carrying but also whether they harbour illegal immigrants, is enormous.

North East farmers protest to protect British farming

Louise Brown

Back in May, Richard Holden failed to support a rebel Tory amendment to the Agriculture Bill, if passed, the amendment would have banned US imports of food produced to lower welfare, food safety and environmental standards than those required of British farmers.

Another protest is possible and very necessary

Julie Ward

Fight For The Future has amassed an impressive list of speakers who have now embarked on a virtual tour of the UK, focusing on national and regional issues, whilst also aiming to mobilise ongoing resistance to the unfolding tragedy of Brexit. The tour arrives in Yorkshire and the North East on Saturday October 10th.