Civil Service - masters of detail
The UK civil service was long regarded as among the world’s very best. This was largely a reflection not necessarily of its efficiency, but of the relative absence of corruption. Civil servants were seen as working in the public interest, and unable to be bribed by vested interests. In other countries bureaucrats seemed to line their pockets and their bank balances, but our civil servants were content to do a lifetime’s work and at the end receive perhaps a £2 bronze medal from the Queen that allowed them to put letters after their name.
There are, however, features of the civil service mindset that work to inhibit reform and change. There is a defensive mentality in which they fear the possible consequences of new policies, and what effect any failings might have on their careers. They would no doubt argue that this represents a necessary caution, but it tends to be taken to an excessive level.
A feature that supports the status quo is that civil servants are masters of detail and prefer to tinker with things as they are, when sometimes a preferable policy might be to replace them with something better. They prefer to implement marginal increases or decreases in allowances or thresholds, or to add or subtract a few percentage points here and there, or to raise or lower staffing levels. In doing so they are taking the existing framework as a given, and making minor changes with a view to making it more efficient or to change it in line with changing events.
Sometimes it is the existing framework itself that needs to be changed, rather than tinkered with. Skill at manipulating the small details might make them oblivious to the big picture. If they look minutely at each leaf, they might not see the forest.
Sometimes when they are looking at ways of doing something better, they might miss the question of whether that thing should be done in the way that it is being done, albeit with minor modifications, or even the question of whether it should be done at all.
An obsession with detail is rather Continental, and perhaps acquired during our membership of the European Union. The rest of Europe is mostly governed by Statute Law in which the laws have to be set out in detail so that magistrates can apply the intentions of the legislators. The English tradition has been more one of Common Law in which the principles are laid down and the details are filled in by a series of judgements by courts and tribunal’s.
The UK is now able, after Brexit, to unpick the thousands of onerous EU regulations that were built up over the decades of our membership. Given the choice, the civil service would probably prefer to examine each regulation and make minor changes here and there. What we should be asking is whether the regulations should be applied in the way that they have been and, indeed, whether they should be applied at all.
EU regulations have largely been process-driven, in which the recipients are told how they must do things. We now have a chance to move to result-driven regulation in which the legislators set out what is to be achieved and leave it to creativity and ingenuity to develop ways of achieving those results.
Civil servants should be given a clear directive from elected legislators to start by asking if each regulation is necessary at all, and then if its purpose might be better achieved by different methods. Detail is all very well, but we should not be so lost in it that we lose sight of principles.
Sorry about this but we'll just have to close down the NHS
As we all know racism is the ultimate sin of our times. Nothing that is racist, in any form, can be allowed to persist. Capitalism is racist - according to some - so that’ll have to go. Britain itself is racist so that’s got to be overturned. The language is racist, attitudes are racist, insititutions are, all must be scrubbed and rebuilt entirely anew:
Radical action is needed urgently to tackle “overwhelming” minority ethnic health inequalities in the NHS, leading experts have said, after a damning study found the “vast” and “widespread” inequity in every aspect of healthcare it reviewed was harming the health of millions of patients.
Racism, racial discrimination, barriers to accessing healthcare and woeful ethnicity data collection have “negatively impacted” the health of black, Asian and minority ethnic people in England for years, according to the review, commissioned by the NHS Race and Health Observatory, which reveals the true scale of health inequalities faced by ethnic minorities for the first time.
That’s that for the National Health Service then. As with those police forces it’ll just have to be defunded.
Hmm, what’s that? The NHS can be reformed so that it’s not racist you say? Ah, so where’s the proof that the universities, capitalism, Britain and all the rest cannot be then?
Charge of the Motor Brigade
Victoria Street, SW1
“You know, Humphrey, I’m getting a bit worried by this Net Zero Carbon 2050 thing. The chaps at the club don’t think it stands a prayer.”
“It is indeed a challenging target, Minister, but the British people have the will and the creativity to achieve it.”
“Really? The chaps round the bar think that’s the government’s job and they are wondering what rabbits we re going to pull out of what hats.”
“I admit we are a bit short on rabbits, Minister, but one of them will undoubtedly appear. The Scots have so much wind that they export more electricity than they import. I read the other day that Scotland’s generation of electricity was 97% renewable and net exports of electricity (exports minus imports) in 2020 was its highest to date at 19.3 TWh, a 21% increase compared to 2019.”
“Of course, Scotland is windier than the rest of the UK, Humphrey, but we cannot be sure they’ll even be part of the UK by 2050. What is UK electricity consumption and how much of that is from renewables?”
“Last July, we announced that ‘Electricity generated from renewable sources in the UK in 2019 reached a record 37.1 percent of total UK electricity generation, up from 33.1 per cent in 2018. This increase reflected a 6.5 percent rise in renewable generation capacity to 47.2 GW.’”
“Steaming ahead but that is based on current electricity consumption. A Net Zero world implies that energy will be virtually all electricity and in the same announcement we said renewables were only 12.3 percent of energy as a whole, i.e. including fossil fuels.”
“Yes, I admit that multiplying current renewables by a large factor is difficult and we also have to address variation. The sun does not always shine, nor wind blow, so we will need renewables to produce well over our needs when they do shine and blow. We can then store the surplus for when they do not.”
“Oh yes, Humphrey, and how are we going to do that?”
“The motor car is going to come to our rescue, which makes a change from it being the villain. I’ve called it the ‘Charge of the Motor Brigade’.”
“I suppose we’re going to turn off the electricity in our homes and go to bed in balaclavas?”
“Funnily enough, that’s about right, Minister. Only electric cars will be sold after 2030 and we reckon 50 percent of cars on the road in 2050 will be electric out of the Ministry of Transport total estimate of 37M. That compares with 31M now.”
“20 percent more traffic is going to burn up a lot of traffic idling in ever greater traffic jams.”
“I think you’ll find, Minister, that electric cars use no power when they are stationary.”
“Right, so we have 18.5M or so electric cars on the roads. That may prove optimistic. Just a couple of weeks ago “a report by the Commons Transport Committee found that taxpayers face an eye-watering £35 billion bill to plug the gap created by the switch to electric cars.” They may be the biggest scam since Gordon Brown sold us diesels. The spokeswoman for this drainage scheme was more realistic: ‘That means one million electric cars could provide 4,000 megawatt hours to the grid at peak times – roughly the same as 5,000 onshore wind turbines.’”
“That’s four TWh, Minister, and I expect you will tell me that’s only just over 1 percent of what the Grid needs a peak times and a lot smaller percent in 2050. Not a big help.”
Anyway, where do the balaclavas come in?”
“Well that’s the clever bit. Because we’ll mostly be working from home, the cars will not actually be on the roads but in our garages or in our drives. The National Grid and the Octopus electricity company are working on a scheme which would allow the Grid to recycle the electricity, when it is not windy or sunny, by draining it from the batteries of our parked cars. Our bedrooms will be getting colder too because we will be using heat pumps – hence the balaclavas.”
“Right, so the quarter of the UK population which then owns electric cars are going to buy charging units that not only charge the vehicle, but drains it?”
“That’s it, Minister. The car owner installs a smart two-way charger which can transfer up to seven KWh back to the Grid when it is needed but probably only about four as the average household needs three KWh. The Grid pays 15p per KWh for what it takes.”
“Humphrey, according to the aide memoire in my desk drawer, the average domestic electricity price in 2021 was 18.9p per KWh. So I buy the electricity to charge my car at 18.9p per KWh and sell it back to the Grid for 15p and on top of that I have to buy a smart two-way charger at God knows what cost?”
“Well, if you took the car down to the supermarket, they’d charge it without charge, so to speak.”
“Do they do comedy lessons at the Civil Service College now, Humphrey?”
“The Civil Service College does not include humour among its core values but it does have a strong partnership alliance with the Mongolian National Academy of Governance. I admit, Minister, that the economics of this do look unattractive today but a lot can change in 28 years.”
“The last statistics I saw were October 2021 when we said 25,927 public electric vehicle charging devices available in the UK of which 4,923 were rapid chargers. I haven’t seen any data on private ownership and use.”
“Minister, I agree the market will be limited by the cost of chargers and the need to have garaging or off-street parking. Most people live in flats or houses with no off-street parking space. Councils can be difficult about running cables across pavements. They are considered hazardous to elderly people with shopping trolleys.”
“So to sum up, Humphrey, we don’t know how many electric chargers there will be, whether allowing the Grid to help itself to the electricity the car owner has stored will make economic sense to the owner, how much electricity can be stored that way, whether that will meet the needs of the Grid when the wind doesn’t blow and the sun doesn’t shine and, most of all, who will have control.”
“What do you mean by ‘control’, Minister?”
“I can go to bed when there’s a nice wind blowing and then there a lull. If the Grid has control, it can simply drain my car battery, so when I am ready to go to work next morning, the car has no juice. Or does the Grid have to ring all potential providers in the middle of the night to ask their permission? Or do I have a drain/no drain switch on my charger, so that the Grid discovers it cannot have my electricity when it needs it? And how does it find me when I am not at home?”
“All good questions, Minister.”
“You remember what happened to the brigade that smart-charged during the Battle of Balaclava in 1854? Disaster. Lord Cardigan commanded the brigade, a nice enough chap, despite being arrogant and extravagant. Obviously nothing like our current Cabinet ministers, Humphrey.”
No windfall tax on oil and gas companies
As the world’s economies move into recovery after the pandemic, the demand for energy has risen, after it fell during the pandemic lockdowns. This has resulted in surging demand for oil and gas and healthy profits for the oil and gas companies. Because of a shortfall in supply, there have been big price rises, and the combination of higher energy bills coinciding with increased profits for energy companies has led to demands for a windfall tax on them.
Early season apples that fall from a tree are regarded as a ‘free’ bonus to the regular crop, and when some companies gain from lucky circumstances to which they did not contribute, their gains are similarly described as ‘windfall.’ Governments, always on the lookout for money, are tempted to impose one-off taxes on what they regard as “unmerited” profits. Naturally, the Labour Party, seeing a pot of money, wants to take some of it, and this time the Liberal-Democrats have added their small voice to the chorus
A proposed windfall tax on energy profits to be redistributed to the poor struggling consumers has a superficial populist appeal. It looks like one of those “robbing the rich to aid the poor” taxes, but it is not. At the end of every tax is a wallet or purse; this is because people pay taxes, companies do not. The taxes levied on them are collected from shareholders, customers or employees, and the energy companies would pass on the increased taxes to them.
Many of the shareholders in energy companies are pension funds. This means that the windfall tax would in fact be paid in part by pensioners. Some part of it will no doubt part be paid through increased prices to customers. Thus, what looks like a tax on so-called “fat-cats” is in fact a tax ultimately paid by quite ordinary people.
There is, however, a more serious downside to an energy windfall tax. It is that it would reduce investment in the industry. At a time when new sources of supply should be being developed, the funds will go to pay the levy, rather than be put to work investing in new sources of supply. What looks like a short-term gain for the Treasury would result in long-term damage to the industry and to our future energy supply.
Oil and gas producers are already very heavily taxed, paying 40% on their profits since Gordon Brown added an extra 10% in one of his famous stealth taxes. This is double the rate that other companies are taxed at. If we want companies to invest in research development, and to put money into new sources of energy supply, we should not be taking from them the funds they would otherwise use to do this with.
What is needed to secure our future energy supplies is a stream of new sources of supply and new methods of energy production that will enable us to produce it and use it more cleanly. This takes investment, and the way to secure that investment is not to make the industry less attractive to investors, which is precisely what a windfall tax would do. This tax would do the opposite of what it intends.
If we could just remind about Adam Smith and the invisible hand?
Well, yes and no and sorta:
In truth, this argument traded upon a long tradition in economics, stretching back to Adam Smith. In The Wealth of Nations the Scottish sage argued that when people act according to self-interest, they are led “as if by an invisible hand” towards the common good.
There are three Smith references - only three - to “invisible hand”. One is about the movement of the planets which is not really an economic matter, the second is in Theory of Moral Sentiments and is also not what is meant here. The third isn’t about the glories of free markets, the efficiency of capitalism or anything else. In fact, it’s about an inefficiency brought about by human nature. Even if - Smith quite clearly sets it up so that the “even if” is understood - investing in foreign parts is more profitable some will still invest at home just because they prefer to. That being the invisible hand that benefits that home economy through investment in it.
It all has much more to do with “Nudge” theories than it does anything else, a quirk of human behaviour that we observe. A quirk that actually works against that naked self-interest of the capitalists.
It seems incredible, as I look back, that in three years of studying economics in the early 1990s
A small recommendation for Mr. Syed. Try reading the source texts again and this time pay attention. Still true that most of the stuff about silver currencies can be skipped of course….
A little lesson in how this capitalist dance works
Much huffing and puffing over how the record oil company profits aren’t being invested in green energy projects. Instead it looks like all that cash will just be handed to shareholders:
The chief financial officer of the oil and gas company BP, Murray Auchincloss, told investors this week: “It’s possible that we’re getting more cash than we know what to do with.”
Yes, this is how capitalism works. Some past investments do produce gushers of cash. The organisations set up to produce those rivers of moolah may well not be optimised to invest in the next round of profit making. There’s no particular reason why a company - BP say - which is jam-packed full of the knowledge of how to drill for hydrocarbons knows how to place solar panels in a field. In fact, we’ve already tested that one, BP used to be the world’s largest solar panel and power company and it wasn’t very good at being so.
The varied campaigners are making a pair of mistakes. The first is the assumption that a company in the energy business should shift as the energy business does. But that’s to assume that Airbus should be making cars, Ford bicycles and Rover trains - they’re all transport, right?
The second is to assume that we’ve not already got a system to deal with these shifts. If BP has more cash than it knows what to do with then it sends it off back to its owners, the shareholders - dividends and stock buybacks. This money does not then disappear for there are only two things anyone can do with money, save it or spend it. There’s some minimal amount of savings that goes under the mattress, everything else gets invested. If the shareholders then spend their extra cash then that save/spend decision is just one more step along the money chain.
Anything handed out as a share of profits by a company gets either spent or invested that is. So, the decision of what to invest in is just being made by a different group of people. Instead of that corporate management who haven’t a clue - they’ve just said they’ve more than they know what to do with - the decision is made by individual investors. Who may well send the money off to SSE to build windmills, or Lynas to mine the metals to build the magnets for windmills, or invest directly in a solar panel farm, or insulate some housing or…
Dividends and corporate payouts move those profits from people who have no clue what to do with them to those who do have several clues that is. Which is indeed how the capitalist dance works. The investment is happening of course, as we can see in the investment numbers themselves, in the portion of energy being generated by the new technologies, in any aerial photograph of the country. Sahreholders receive the profits of past investments and, largely enough, use them to finance the next generation.
Of course, there is that alternative route, the one being clamoured for, which is that the profits be taxed away, the shareholders receive and redeploy less and government decides where the cash should go. We can’t see it working to be honest, we’re deeply unsure that politicians directing past fossil fuel profits into increasing the number of grievance studies graduates is really going to do all that much to beat climate change.
Could we suggest The Guardian reads up a bit on America?
We’re all for globalisation, of course we are. So, The Guardian wants to become the global English language newspaper for the progressive types. We can - and do - moan about the content but can’t fault the ambition. We would though suggest that actually learning something about that globe out there is a useful precondition.
At which point:
On Tuesday, the US supreme court in its Merrill v Milligan decision, upheld Alabama’s racially gerrymandered congressional map, which see Black people represented in only 14% of congressional districts, despite making up about 27% of Alabama’s population. This ruling is reminiscent of the holding in the supreme court’s 1857 Dred Scott decision that Black people “had no rights which the white man was bound to respect”. Even though the two cases addressed two different situations, the overall disregard of the rights of Black people in America by the highest court in the country is the same.
And Jim Crow is coming back and aren’t Republicans awful and so on. It would only take the slightest of tweaks to the GuardianColumnGeneratorBot to complete the 1200 words.
Except the Supreme Court didn’t uphold anything. What it said was that it shouldn’t be overturned right now. Hey, it might be terrible, that’s for the full case to be heard, but we can’t go around changing election rules right before an election. That is what the court said. If there’s to be an election then everyone needs to know what the rules for this election are, what the districts are, which ones to run for, even which ones the would be politician currently lives in.
There is a tension, that is, between having good rules for this election and having settled rules that allow the election to take place. In accordance with previous decisions given the imminence of the election having settled rules won over good rules.
BTW, the election started yesterday, Friday, Feb 11. That was the filing date to run in the Republican primaries.
This might all sound too detailed about something far away from our usual concerns here. But there is that Gell Mann Amnesia effect to think about. When the details of the story are examined it turns out not to be the way the newspaper tells us it is. Which has implications for everything else The Guardian tells us, doesn’t it?
Err, remember the amnesia that is.
A climate change solution
We admit that we have no idea at all whether this would work:
Quaise Energy, a startup that just raised a $40 million Series A funding round led by Safar Partners, uses “millimeter wave” drilling systems to go as far as 12 miles underground—that’s 3 to 5 times deeper than typical oil and gas drilling—reaching a layer of rock which is more than 700 degrees Fahrenheit. The heat can be used as a constant power source essentially anywhere on the planet.
We’re not even going to try and work it out either. The reason we don’t drill that far routinely anyway is because it’s not economic. It just takes too long to pull the drill bit up, sharpen it, then send it down for another go. So, if a new drilling method does it, well, why not?
Further, they seem to us to be being sensible. A fossil fuel plant is really a way of getting steam that you can run through turbines. So, if you’ve got a hole with lots of steam, why not make the holes at the fossil fuel plants where you’ve already got the turbines, electrical connections and so on?
Yes, we are alive to the joy deployment of this system would bring. For there would either be all those screaming matches about seismic activity which acommpany fracking - the waste water injection would lead to the same activity - or we’d find out that the screaming wasn’t about seismic activity in the first place.
Our real point here though is that this is the sort of thing that does get tried out with a sensible policy response to climate change and doesn’t with the response to climate change we’ve got. For the system we’ve got depends upon bureaucrats and politicians deciding what gets built and where. This leaving us with Drax burning American woodchips and this being described as carbon neutral - a nonsense. A sensible system - as described by the Stern Review, by Bill Nordhaus in gaining his Nobel and so on - just sets the basic limits to the system then allows ingenuity to explore all the myriad ways of reaching the desired goal.
That planned system also has another difficulty with it. Big Solar and Big Wind now have their lips so firmly grasping the subsidy firehose that they’re not going to allow some potentially competitive technology to get a look in. Vide those seismic restrictions on fracking.
We would end up laughing like drains if geothermal, or fusion say, ended up being the actual answer. After we’d mourned the trillions lost to men of plans and their delusions of course.
Mr. Monbiot, tax and the North Sea
George Monbiot is angry - and we’ll not like him when he’s angry - about the manner in which Shell and BP appear to be paying no taxes on their North Sea production. He’s right that they’re not paying but he has not noticed that the reason they’re not is that they already have.
In the UK, these companies have been granted a licence to print money. For the past three years, Shell and BP have paid no corporation tax on the oil and gas they extract from the North Sea and no production levies either. In other words, they have been given these resources by the government.
Whoops, I mean paid to take them away. Over the same period, they have been granted reliefs on the taxes they didn’t pay of almost £400m. This is because they can claim the cost of decommissioning their rigs and platforms against their nonexistent tax bills. But decommissioning should have been priced in when the contracts were signed. It’s a classic case of private profits, public liabilities. After being paid to take the gas away, these companies sell it back to us at mind-boggling prices.
You see, the costs of decommissioning were priced into those original contracts. Which is why no tax is being paid now.
Everyone does know, everyone did know, that there would be two grand lumps of costs in exploiting the North Sea fields. Putting up the rigs and pipelines to do the exploiting and then taking them down again 50 years later. OK, maybe 25 years later. The interim, the running costs, were minimal.
Any sensible business knows how to deal with this. In those years of minimal running costs but gushing revenues you put aside a certain portion of the income to build up a fund to pay that final bolus of costs.
This ran smack into the political desire to have the cash now. The tax revenues that is, the tax revenues that would be diminished by allowing anyone to put aside income now to be stored for future use. So, the British government banned the oil companies from creating sinking funds to pay those final costs. Instead, pay all the royalties, super-profits taxes, higher corporation tax rates, to the Treasury this year and in 15 years when you have to decommission we, the Treasury, will let you have back the tax you’ve already paid on the money you should have been saving for these expenses.
Decommissioning was priced into the original contracts, that’s why taxes aren’t being paid now. Because they were paid 15 years back and now need to be returned - because that’s what the original contracts said - as it’s the Treasury that has been enjoying that sinking fund, not the oil companies.
George Monbiot is complaining about the very solution to his complaint. The reason no tax is currently being paid on North Sea oil is that decommissioning was priced in when the contracts were signed.
We’ve no problem with people complaining about this system, of course we don’t, we’ve not been wholly in favour of it ourselves. We do think though that people who complain about it should know about it.
What Idiot is Blocking Imports From the EU
You may recall being told that the EU was over-regulated but when we left, all that would be shed? In reality, our government is loading those over-regulated EU goods coming into the UK with a whole lot of our own. Allegedly to comply with World Trade Organization (WTO) rules, the UK is required to apply UK devised import controls on goods arriving from the EU in a way that is no more favourable than it does on goods arriving from the rest of the world. Imports are slowed, ports are blocked, bureaucracy is multiplied and the costs to British consumers are raised, compounding the inflation we are already suffering.
Worse still, the out-of-control Whitehall bureaucracy cannot decide what controls it wants and is keeping everyone guessing. The 36th report of the Public Accounts Committee chastises the government for being unable to specify the new systems and paperwork, or even where inspections should take place, but they have missed the point. Why do these goods need and import controls, delay, inspection and paperwork at all?
The Committee cites evidence “that even though full import controls have not yet been introduced into the UK, the new formalities and costs that have [already] been introduced make it more expensive and complicated to trade between the UK and EU.” (para 9) “Office for National Statistics (ONS) data for the UK’s total trade in goods with the EU (exports plus imports) show there was a 23% and 13% reduction in Quarter (Q) 1 2021 and Q2 2021 respectively against Q4 2020.” (para 8) The potential Get Out of Jail card, i.e. allowing minimal blockages is if the “differences are justified by one of the exceptions to the Most Favoured Nation rule as set out in the WTO treaties.” (para 3)
We were led to understand that the EU-UK Trade and Cooperation agreement (TCA) did establish the EU and UK as mutually “most-favoured-nations” but on re-inspection it may not do that. “Most-favoured-nation” is mentioned 65 times in the TCA but they seem to be more about mutually being “no less favoured” than being “most favoured” in which case the UK’s import bureaucracy for goods from the EU has to comply with bog standard WTO rules as distinct from genuinely free trade. Whichever way you skin the cat, some idiot in Whitehall is responsible for either negotiating a TCA which is pointless and misleading us in the process or now failing to take advantage of the open borders to which our businesses are entitled and creating a wholly unnecessary bureaucracy.
We cannot do anything much about the rules the EU creates for imports from the UK since that, ultimately, is their business. But what happened to the sovereignty over our own borders we were told the UK would regain? And since import bureaucracies benefit neither the EU nor the UK why do we not use the most-favoured-nation rules to trade them away even now, especially as the UK still have not set them up (Northern Ireland apart). The truth seems to be that we are ruled by civil servants who just love making life difficult and expensive for those contributing to our economy.
The Public Accounts Committee grumbles that the new UK import controls which should be in place by now have been postponed: “The UK originally intended to introduce import controls on goods entering Great Britain from the EU when the transition period ended in January 2021. The government has delayed introducing these controls three times and now intends to introduce them in phases between January 2022 and November 2022.” (Conclusion 4) Of course, January 2022 has come and gone, and no visible progress has been made. “By October 2021, only 42 of 5,000 users had moved across.” (Conclusion 8) HMRC excuses itself on the basis that it not only has to train UK importers, but also the 27 EU member states exporting to the UK. No wonder no one in HMRC has time to answer the phone, or prevent billions of fraudulent takes from the Treasury, when they have to rush around Europe training foreigners.
But that raises a more interesting point: these controls should have been in place over two years ago but we have managed without some of them and probably could have been better off without any of them. That being the case, why do we not postpone all of them indefinitely?
The answer, of course, is that we are ruled by idiots and those that should be ruling them are enjoying tea parties at Number 10. Let us hope that the appointment of Mr Jacob Rees-Mogg will bring sanity. The simple truth is that products from countries with whom we have shared common standards for nearly 50 years no more need import controls, than imports from Wales into England. As and when significant differences emerge, special, targeted checks can apply but not the whole shebang.
“In December 2020, the government published its 2025 UK Border Strategy, which set out the government’s vision to have the “world’s most effective border” by 2025. This set out how the government would improve coordination between government departments and agencies at the border; reduce duplicative asks for data; and make greater use of modern, digital and simple processes.” (para 23) The government’s 2020 paper sets out six unworldly “transformations” of which the last is a good example: “Shape the future development of borders worldwide, to promote the UK’s interests and facilitate end-to-end trade and travel.” The world’s most effective border is not defined and the Committee clearly rightly regards the whole paper as a joke. It drily notes that the government’s track record on large IT systems is not good. What is “effective”? The least burdensome border is no border at all but that is the very opposite of what the bureaucrats are trying to achieve.
The one area where some form of border control is necessary is VAT. When the UK was part of the EU, each member state pocketed the VAT it collected and refunded what was due, no questions asked. No VAT was charged or refunded at borders. That is still true for goods moving between the Province and the EU as Northern Ireland is treated as part of the EU for VAT purposes. Goods now entering Great Britain from the EU (and the Province) pay import VAT and vice versa. Of course, the negotiators of the TCA should have allowed the old rules to continue as part of the TCA until VAT rates diverged materially, but…
Even if all these controls are necessary, the manner of their introduction is incompetent: the Public Accounts Committee says “We also note the potential [regulatory and fiscal] risks caused by delays putting in place the necessary permanent infrastructure: for example, until the Dover White Cliffs site becomes operational in 2023 trucks arriving in Dover that are carrying goods selected for physical checks will have to travel 60 miles to Ebbsfleet. The further the inland sites are from the ports, the greater the risk that goods could be offloaded on the way. HMRC agreed it would be ideal to have the infrastructure at the port itself and goods controlled at the port but said that it was not possible.” (Conclusion 6). Traders are expected to comply with all these new rules by the end of the year but they do not know what they will be, still less how to comply.
They should all be postponed five years to sift the necessary from the unnecessary with full trader consultation, publish the net requirement and then give traders time to adapt.