Ports demand £120m for ‘obsolete' Brexit border posts
Britain's ports are demanding £120m in compensation after Sir Keir Starmer's EU trade deal removed the need for costly post-Brexit border posts.
The request for taxpayer-backed compensation has been made after the new UK-EU agreement meant that new refrigerated inspection sheds, warehouses, car parks and roads would become surplus to requirements.
The Prime Minister's agreement will remove the need for border checks on plant, animal and food imports from the EU, wiping out the fee revenue that ports were banking on to recover the hefty capital cost of setting up the new checkpoints and inspection facilities.
The ports' demands could add an unforeseen taxpayer cost to the UK-EU deal, putting further pressure on the Government's already stretched finances and offsetting some of the deal's benefit.
It would also be controversial, given Britain's ports are owned by Middle Eastern and Chinese investors. Some of the recipients would include UAE-owned DP World and the Hong Kong-based conglomerate CK Hutchison.
'We've prepared these facilities in good faith, and now they're not going to be used,' said Richard Ballantyne, chief executive of the British Ports Association.
'Some of them may be eventually demolished, or at least modified. The Government should cover the full costs of these white elephants and put this episode behind us.'
In 2020 the government doled out £200m to 41 ports across Britain in payments ranging from under £100,000 to more than £20m. The money was to be spent on infrastructure designed for inspections and spot checks on trucks from the EU carrying farm and food produce.
But the Port Infrastructure Fund was not large enough to meet demand, leaving the ports to foot up to £120m of the bill – much of which was incurred during the pandemic, when construction costs soared.
Once built, a typical large border control post costs around £200,000 to maintain, with running costs including energy, security, business rates, cleaning and repairs.
The plan was for the ports to recoup at least the operating costs of the facilities, if not the capital and opportunity costs, from charging levies or fees on the EU-origin trucks that used them. Up to 40pc of Britain's trade with Europe is in agri-food or related products.
But the UK-EU deal will set up a 'common sanitary and phytosanitary area' that will remove the need for the checks and inspections – and for the revenue and infrastructure that supports them.
'It's quite impressive infrastructure. But it could be largely redundant now,' Mr Ballantyne said.
It could be more than a year until the UK-EU deal on animal and plant products is implemented. Mr Ballantyne said this would give the Government and industry time to set up any compensation mechanism.
'Based on our experiences last time, it's got to be quite flexible. The conditions that were placed on ports last time were too onerous,' Mr Ballantyne said.
The Government was contacted for comment.
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