Risk of No-Deal Brexit Choking Ports Rising, U.K. Lawmakers Say

(Bloomberg) -- U.K. ports are increasingly at risk of facing major disruptions if there’s a no-deal Brexit as a “complacent” transport department makes slow progress with preparations, lawmakers warned on Wednesday.

The workload will remain challenging even if the U.K. manages to agree on a divorce deal with the European Union before its scheduled exit on March 29, according to the the House of Commons Public Accounts Committee, a parliamentary panel that scrutinizes government spending.

The government has yet to test its so-called “Project Brock,” which envisages turning part of a highway near the port of Dover into a holding area for trucks, the lawmakers said.

Prime Minister Theresa May is trying to gather support for a proposed divorce deal with the EU, under which the U.K. will remain in a customs union with the EU for a 21-month transition period while Britain negotiates new trade arrangements. She faces a decisive Parliament vote on Dec. 11, which many expect her to lose, potentially leading to the U.K. dropping out of EU without any transition or trade deals.

“There is a significant and growing risk” that the transport department will not be ready in such a scenario, the PAC said. “The department’s preparations for avoiding disruption around major ports are worryingly under-developed.”

Those warnings add to a growing list. May’s proposed deal “falls short” of guaranteeing frictionless trade and doesn’t rule out increased border checks for U.K.-EU trade flows, the British Ports Association said last week. If there’s no deal, the Bank of England can’t do much to counter economic damage from supply problems, policy maker Michael Saunders told a parliamentary committee Nov. 20.

Businesses have been kept in the dark as the government discussions were conducted in secrecy, handicapping their ability to prepare for a no-deal outcome, the lawmakers said. Contingency plans like road hauliers potentially changing their routes or point of entry to Europe, and the process of registering trailers for road haulage permits, are subject to the government’s non-disclosure agreements, they said.

“We see these agreements as undermining transparency and hampering the spread of information to the business community at large,” the PAC said. “It should urgently step up its communications with businesses and other stakeholders on what they need to do to prepare.”

To contact the reporter on this story: Anurag Kotoky in London at akotoky@bloomberg.net

To contact the editors responsible for this story: Fergal O'Brien at fobrien@bloomberg.net, Brian Swint, Andrew Atkinson

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