Oireachtas Joint and Select Committees

Tuesday, 13 November 2018

Joint Oireachtas Committee on Agriculture, Food and the Marine

Implications of Brexit for Agriculture Sector: Discussion

3:30 pm

Mr. Simon McKeever:

It is anecdotal and it is not on a massive scale. On the landbridge, approved economic operator, AEO, status will be able to help a lot of transport on and off. We are not 100% sure about the food sector because our sense is for livestock and animal product, the truck will be opened and will have to be opened. The jury is out on that. The AEO will help with other matters in terms of bonding and paying money across. Will it be the solution? There are a number of issues with the AEO model, one of them being with regard to groupage. If the foodstuff is in the same truck as other bits and pieces, it may have a knock-on effect on other goods going back and forth across the Border.

A question was asked about whether there is a model for no checks. I am not aware of such a model. There is talk that a truck would be sealed somewhere in Ireland and reopened so there are issues around security. There is talk that the truck could start in Ireland, route through the UK and be opened in France. The AEO model is most effective when the whole supply chain end-to-end has AEO accreditation and certification.

Customs declarations were referred to. There has not been a need to have customs declarations since Ireland went into the European Union so that expertise is largely gone out of the country. Companies that are trading with other parts of the world outside the EU have that knowledge but the demand for basic customs courses is going through the roof. Initially, people who were supply chain professionals were coming to the courses but finance managers of companies are beginning to come to them. In 2016, there were 1.3 million customs declarations on and off the island. About 700,000 were import-related and 630,000 were export-related. It is expected to increase tenfold. There is technology available to help with it but there is a very low level of expertise and people with such expertise are highly sought after at present. Many of our members tell us they are actively trying to recruit such people. At the same time, the Revenue Commissioners is trying to recruit such people. It is exactly the same in the UK. We will not be able to take them from there and they will not be able to take them from here. There is a massive demand for that expertise at present. Companies are actively engaged in contingency planning around that. The question is whether they employ one or two experts and try to train a number of people internally or whether they buy in the expertise. If we were not talking about Brexit, we would be talking about the major competitive issues that already exist in the economy but this is an additional piece. There will be costs in terms of employing people and potential time delays. Those people will become very expensive over time. It is a big issue.

With regard to the question on the UK and delays, our friends in the British Irish Chamber of Commerce might have more of a view on this. My sense is there have been some initial conversations and the one that seems to be the Holy Grail for them is a trade deal with the United States. At the conference I attended last week, I heard the trade deal that companies want to have is with their biggest trading partner outside the European Union. It is being held out as the Holy Grail. If one listens to what is coming out of the White House, it seems to be keen to do a trade deal with the EU and the UK. It seems to have moved on a bit. I think it will be a lot more difficult for them to do trade deals than they might believe it is. There is very little awareness of the fact that it will be much more difficult for them to do such trade deals. The UK's trading pattern is not awfully dissimilar to ours in that the EU is their biggest trading partner. It is nonsense to jeopardise that in order to replace it with trade coming out of the Commonwealth countries. I do not want to name names but at the conference I attended last week, I sat in the room and listened to fake news. Somebody who was billed as a learned individual got up and spoke about a specific issue but it was just untrue. I sat in the room with these captains of industry. The stuff that is going on is astonishing.

With regard to Brexit mitigation and state aid, I am not aware of any application for state aid around a worst-case scenario deal. I am not aware of any of that but I am absolutely certain companies will need assistance. I mentioned that as recently as last week, we were told by three of our members that the measures they put in place will run out after six months. They are reasonably sized companies and that is the breathing space they have bought themselves.


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