Major disruption at ports is ‘real prospect’ in no-deal Brexit says PAC

• - PAC concerned by slow progress and poor communication around Project Brock 
• - Ability of businesses to plan is hampered by secrecy and lack of detailed information
• - Department urged to write to PAC before Christmas with updates on progress

Please find attached the embargoed Report noted above.

REPORT SUMMARY

There is a real risk that the Department for Transport will not be ready in the event of the UK departing the EU without a negotiated deal, and this risk is increasing as time runs out to deliver what is needed. 

This is our latest report in a series looking at Government’s preparations for Brexit. And, as in our previous reports on border preparations, customs, Department for Environment, Food and Rural Affairs and the Department for Business, Energy and Industrial Strategy, we are concerned about how well Government is prepared.

There is a real prospect of major disruption at our ports. The slow progress and poor communication around work to avoid this through schemes such as Project Brock concerns us.

The lack of detailed information provided to businesses to help them prepare and the secrecy surrounding discussions through the use of non-disclosure agreements is hampering businesses’ ability to plan. 

Added to this is the Department’s uphill task to pass the necessary legislation in time, the majority of which the Department sees as essential, whilst allowing time for proper scrutiny of this.

With only months to go, it is extremely worrying that we are seeing these same concerns again and again with little progress being made. Even if a deal is agreed, the Department faces a challenging workload during the proposed transition period. 

We acknowledge the difficult situation for the Department in having to prepare for all Brexit scenarios. But it must be open about the challenges it faces and work with businesses and stakeholders to help them get ready for whatever the future brings. 

COMMENT FROM PAC CHAIR MEG HILLIER MP

“The future of road, rail, maritime and air access to Europe after Brexit remains unclear and the Department for Transport has a critical role in ensuring the UK is prepared.

“With so little time remaining, there is still much to do. The risks associated with no-deal are severe, yet plans for avoiding disruption around major ports in particular are worryingly under-developed.

“The Department plans to spend £30-35 million this year on Project Brock, intended to manage traffic and lorry-queuing at Dover. But it is still to carry out proposed desk-based testing of the system and engagement with businesses has been poor.

“The secrecy around the Department’s preparations, and the shortcomings in assurance on its progress, are a potentially toxic combination.

“We accept the continued uncertainty over the final shape of Brexit adds to the complexity of the challenge. But the Department’s Brexit work is simply too important to get wrong.

“It must be more open about what needs to be achieved, and work with business and others to deliver it. We urge it to respond meaningfully to our concerns in the weeks ahead.”

COMMENT FROM PAC DEPUTY CHAIR SIR GEOFFREY CLIFTON-BROWN MP

“Our report makes it clear that the Department for Transport has a great deal to do before we leave the EU on 29 March 2019, especially if no deal is reached.

“It needs to make whatever contingencies necessary to ensure that disruption to passengers, goods and services arriving or leaving by road, air or sea is kept to the bare minimum.

“I am concerned, in particular, that the movement of goods continues which will mean the port of Dover will need to operate at an optimal level and that more goods will need to travel through other ports. 

“To minimise the disruption at Dover and the potential knock-on effect to hauliers travelling through the port, the Department needs to ensure that Project Brock is ready to operate as early as possible.”

CONCLUSIONS AND RECOMMENDATIONS

There is a significant and growing risk that the Department will not be ready if the UK exits the EU without a deal. The Department tells us that there is little, if any, contingency left to cope with slippage amongst the 28 internal projects it has underway.  The Department is dependent upon decisions being taken elsewhere in government and on the state of discussions with other countries to progress some of its plans.  Projects such as the issue of permits to international drivers and road hauliers are however within its control. The Department has several IT systems related to these projects to develop and deliver within the next few weeks and months, and IT systems are notoriously difficult for government to deliver on time. The Department also acknowledges that air services and international rail travel are areas where discussions with other countries are at a very early stage.

Recommendation: The Department should write to the Committee before Christmas 2018 to set out progress achieved against its 28 projects, and which projects remain at greatest risk.  

The Department’s preparations for avoiding disruption around major ports are worryingly under-developed. The Department will manage traffic and lorry-queuing at Dover through ‘Project Brock’. The Department has plans to do some desk-based testing around its operation of Project Brock, although it has yet to carry it out. The Department seems happy to rely on Highways England to manage engagement with local stakeholders, but acknowledges this has not always worked well so far. The Department does not liaise directly with other English ports and their related local authorities, which it informs us is the responsibility of the Ministry of Housing, Communities and Local Government.  The Department has begun in-depth discussions with the Welsh Government, but not the Scottish Government.

Recommendation: The Department should write to the Committee before Christmas 2018 setting out the results of any testing of Project Brock, and how wider plans to keep ports across the UK open for business have progressed.

There is a danger that the required legislation will neither be subject to proper scrutiny, nor passed in time for EU exit. The Department’s figures on how many SIs need to be passed by Parliament before the end of March 2019 (currently 66) are changing regularly and may change further. It had laid 19 of these 66 before Parliament by 24 October. The Department says that around half of its SIs will require debate, but that it is looking at ways to reduce this to speed up progress. We are concerned that there is a risk that the scope for Parliamentary scrutiny could be reduced for the sake of administrative convenience. The Department regards 61 as essential to be delivered before the end of March 2019, but could not explain what would happen if they weren’t laid in time. We identified the same issues with the volume of legislation required in such a short space of time in our recent report on preparedness for EU exit at Defra.

Recommendation:  As recommended in our recent report on Defra’s preparations, The Cabinet Office should prioritise EU statutory instruments across government to ensure the drafting of those of highest priority is completed to the proper quality standard, and that there is time for proper parliamentary scrutiny ahead of EU Exit.

The Department’s approach to its preparations appears complacent.  The Department told us that it was happy with progress on four of the projects where we probed further on progress (maritime databases, International Driving Permits (IDPs), the trailer registration scheme and road haulage permits), but its answers were short on detail and suggested a heavy reliance on assurance from officials in its arms-length bodies, such as Highways England with regard to Project Brock. We were left concerned that the Department remains prone to the optimism bias that we have witnessed on other projects overseen by this Department. 

Recommendation: The Department should make sure that it receives regular independent assurance on the progress of key projects. As part of its update to the Committee, the Department should set out how it is drawing on independent assurance that progress is being made, and the action it has taken as a result.

Too much consultation with business organisations has taken place under the cloak of non-disclosure agreements, and this secrecy hampers the ability of the business community at large to prepare. The Department acknowledges that key industries are seeking information to be able to develop their own contingency plans, such as the potential need for road hauliers to vary their routes or point of entry to Europe. Businesses may have to change the way they register trailers or apply for road haulage permits. Yet it appears that in making its preparations, the Department has had limited engagement with the business community at large, either in developing or testing plans. The Department’s engagement with the transport industry in developing technical notices has been covered by non-disclosure agreements and the Department is unable to inform us of their scope. We see these agreements as undermining transparency and hampering the spread of information to the business community at large. Again, we raised this concern in our recent report on preparedness for EU exit at the Department for Environment, Food and Rural Affairs.

Recommendation: As we recommended in our recent report on Defra’s preparations, the Department needs to limit the use of non-disclosure agreements to commercially sensitive discussions. It should urgently step up its communications with businesses and other stakeholders on what they need to do to prepare.

The Department’s continuing caution in its public communication about EU Exit means the public and businesses cannot prepare adequately if there is no deal.The Department acknowledges that communication needs to improve, as we have seen from examples such as the concerns caused by Highways England’s work on the M26. While some actions may only be needed in the event of ‘no deal’, time is running short and we expect that groups, such as people planning to drive in the EU after March 2019, should be made aware that action will be needed soon, even if it is not yet clear what that action will be. The Department emphasises the role of third parties in disseminating information (for example, hire companies or Post Office staff issuing International Driving Permits), but has not provided detail on how it is co-ordinating this work.

Recommendation: The Department should write to the Committee before Christmas 2018 setting out the progress made against its plans for providing the public and businesses with the information they need.