An extraordinary cabinet row has erupted over Brexit with Liz Truss warning that Boris Johnson’s border plans risk smuggling, damage to the UK’s international reputation and could face a legal challenge from the World Trade Organization.
The international trade secretary wrote to the chancellor, Rishi Sunak, and Michael Gove on Wednesday warning of four “key areas of concern” over their plans for the border next January.
In a letter, dated 8 July, leaked to website Business Insider and also seen by the Guardian, she says: “Dear Rishi and Michael, I am writing to you to set out my key areas of concern on border policy and readiness for the end of the transition period and to seek your assurance that the concerns will be addressed.”
She says she has written the letter in advance of the “border operating model publication on 13 July when the UK’s proposals for the border will come under renewed scrutiny both on the domestic and international stage”.
Gove unveiled the new border Brexit regime last month for traders, announcing that customs and health checks required for goods imported from the EU would not be imposed immediately and instead be phased in over six months.
But Truss warns the “staged approach” would “be vulnerable” to legal challenge by the World Trade Organization which could object to goods coming in from the EU being treated differently to goods coming in from elsewhere which are already subject to tariffs and quotas.
She also raises concerns over smuggling because full checks will not be in place for all goods coming into the UK at borders from 1 January.
“I would like assurances that we are able to deliver full control at these ports by July 2021 and that plans are in place from January to mitigate the risk of goods being circumvented from ports implementing full controls,” she wrote.
Thirdly, she is concerned that some unscrupulous traders from outside the EU could exploit the lack of controls and get their goods across the border without tariffs or checks.
Her fourth concern centres on a nascent scheme for traders sending goods from Great Britain to Northern Ireland.
Customs controls are being applied as part of the special arrangements for the region to avoid a border on the island of Ireland. She reveals that the digital application of the special tariff regime for Northern Ireland has been deemed “high risk” and “HMRC are planning to apply the EU tariff as a default to all imports in NI from 1 January 2021”.
“This is very concerning as this may call into question NI’s place in the UK customs territory,” Truss wrote in relation to the potential imposition of tariffs.
Under the Northern Ireland protocol, tariffs were to be imposed on goods entering the regime with rebates on all goods remaining in the region, such as goods going to local supermarkets.
But the government has said that tariffs would not be imposed and business leaders assumed this was because they would have a sophisticated system in place, in time, to distinguish between goods remaining in Northern Ireland and those crossing the border into Ireland.
Truss’s letter indicates that now is not the case.
It comes as the environment secretary, George Eustice, revealed that the government is looking for some form of exemption for food arriving in Northern Ireland from Britain.
“We will be trying to work out whether there can be special provisions on that, otherwise it will cause quite an issue,” he told a Lords committee, conceding that the “time is tight” to put any measures in place.
Shadow chancellor of the Duchy of Lancaster, Rachel Reeves, said Truss’s letter “confirms fears that several ministers have been making things up as they go with a lack of awareness of the real world consequences of border policies they’ve had four years to develop”.
A spokesperson for the Department for International Trade said: “We do not comment on leaks.”
It said it was continuing its work and consultation with business to make the borders Brexit ready with a “new IT system to facilitate movement at the border”.