In the Swamp

A blog from Michelle Thomson and Roger Mullin

Only fools know precisely what is going to happen as a result of the UK leaving the European Union. We make no claims to having a crystal ball. The more the uncertainty, the more we cannot accurately predict the future. We are (in) Donald A. Schön’s words “in the swamp” facing a problem of great interest, but where uncertainty abounds.

These are the early words in our final report into Brexit and Scottish Business published in February 2018, almost three years ago. Sadly, they could be written today. We remain in the swamp, thanks to an incompetent UK government under successive Tory prime ministers since the Brexit referendum of 2016.

Rereading our interim report of late 2017, our final report quoted above, and our report of January 2020 into the Scottish Business diaspora, has been a very sobering experience. Despite years for preparation at its disposal, the UK government has contrived to increase uncertainty rather than deal with it and has pursued an ideologically driven project with little regard for the consequences for both business and ordinary citizens.

Day by day, the situation deteriorates as we approach January 1st 2021 and the end of the transition period. Pictures of miles of lorries queuing up were happening even before France’s imposition of a 48-hour block on transport due to Covid19. It was all so predictable that this would happen without adequate preparations. Consider this quote from a logistics expert and business leader from our report of February 2018:

HMRC and Borderforce who are the agency carrying out its physical checks are in the frontline of Brexit with responsibility for security and the revenue capture from levies on imported goods under current and future regimes.

As far as possible HMRC target inspection remote from ports to minimise disruption and rely on declarations from shippers and forwarding agents to direct their activities. HMRC has estimated that this will increase from the current 55million entries (each entry takes around 50 pieces of information) to 255 million entries, which will require up to an additional 5000 staff to handle the administration...

(Furthermore) HMRC is only one of 26 agencies which can intervene in an international transaction with bodies such as Home office (Immigration), Environment Agency (Toxic Waste), Port Health (Contaminated Food) and local authorities all accounting for up to 75% of the inspections which occur at the ports. Each of these agencies will have to scale up activities to ensure “control of our borders” to varying degrees depending on the reliance of each on the current controls in place within Europe.

This was all known years ago. As we argued at the time, there was a coming together of uncertainty and complexity that called for significant investment by government in preparations and a sustained interaction between government and business. Instead, the swamp has simply been allowed to become deeper and more toxic.

We are therefore strongly of the view that even at this late stage, efforts should be made to extend the transition period, as was on offer earlier this year from the EU and foolishly rejected by the Prime Minister. We need more time to get out of the swamp.

It has been particularly telling for us in reviewing the data from our business diaspora study earlier this year, that there is an overwhelming view from amongst out international friends that Brexit is bad for Scotland. Indeed our study which involved 1067 respondents from 74 different countries had this to say:

and it should be noted that there were no respondents within the strengths and weaknesses section of our survey who commented that Brexit should be viewed as a strength

That said, our business diaspora is willing to contribute to helping Scotland through this very troubling time. There is perhaps scope for the Scottish Government to undertake further work of its own in driving forward stronger and much needed connections from indigenous Scottish businesses to our diaspora throughout the world.

Finally, in this blog, one of the great concerns of businesses was access to labour and particularly the right skills to support businesses at this time and in the future. We called three years ago for the following:

The Scottish Government should commission a review of its skills strategy.

Most recently, we have undertaken a study into the WorldSkills movement and Scotland. We are of the view that the search for international excellence in skills has never been more important. Having the right skills and of the highest quality are going to be more essential than ever in dragging ourselves out of the swamp.

There is so much more we could say, and that needs saying. If ever we needed to see Scotland grasp control of its own destiny, it is surely now. Every day that passes increases our concerns about our place in this uncertain and complex world. It also increases our belief that Scotland must take its own decisive action and create its own future.

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