UK Border Strategy: moving goods and people

 

The Government’s 2025 UK Border Strategy sets out how it plans to improve the way people and goods can move across international borders given Brexit and the longer structural changes in world trade.

As a welcome foretaste of what one hopes will continue, this is a pan-department strategy involving the Home Office, DEFRA and the Treasury/HMRC.

The strategy sets out the type of border which they would wish to create, the operating model for that border, the approach to working with the border industry and users to design and deliver this and the changes that will need to be made in government and industry to implement it.

It is a big ask and set out under six “transformations”:

1. Develop a co-ordinated user-centric government approach to border design and delivery which works in partnership with industry and enables border innovation
   
2. Bring together government’s collection, assurance and use of border data to provide a comprehensive and holistic view of data at the border
   
3. Establish resilient ‘ports of the future’ at border crossing points to make the experience smoother and more secure for passengers and traders, while better protecting the public and environment
   
4. Use upstream compliance to move processes away from the actual frontier where appropriate, both for passengers and traders
   
5. Build the capability of staff and the border industry responsible for delivering border processes, particularly in an environment of greater automation; and simplify communications with border users to improve their experience
   
6. Shape the future development of borders worldwide, to promote the UK’s interests and facilitate end-to-end trade and travel.

Written broadly like that, much seems just aspirational or even obvious “apple pie” but the strategy goes into further detail (otherwise it would be a boring 84 pages) and initial work on understanding what needs to be done is already under way.

It is not a small ask: 21 million people travelled through our ports and 255 million through our airports in 2019.  383 million tonnes of international freight were handled at ports with a smaller, but not insignificant, amount at airports and via the Channel Tunnel.

Reductions in red-tape can’t be done one sided: every export from the UK is an import somewhere else and vice versa.  But systems can be made easier and much of the strategy relies on better IT.  Key is simplifying systems where they can be simplified, ensuring that information does not need to be entered multiple times, better use of technology to track goods with information flow-through, “upstreaming” of information so that it doesn’t need to be entered at the ports and better guidance to the end-users.  None of this is impossible, much of the technology already exists and other countries such as Singapore and New Zealand are already leaders in this field.

From a business view point it all looks good in theory although whether it can made simple enough to attract more SMEs into international trade remains to be seen.  Simplification helps but simplification comes with a trade in choices that can be made by business.  “One-size-fits-all” is simple but hurts those where the size doesn’t fit, whereas a range of tailored solutions fits more, but at the expense of complexity.  This is a challenge which the process designers will need to face head on and it is welcome, therefore, that there is an undertaking to work with users (read: passengers and businesses) in realising the strategy.

One potential stumbling block will be the extent to systems can be integrated with other countries’ ports.   There is little in the strategy about this.  New systems will be most attractive if they not only ensure a freer-flow of goods at the UK end but also at the originating or destination ports at the other.  However, any such agreements between countries are slow in realisation and it may be that the only approach here is incremental. 

There is mention too of the Government’s commitment to ten new freeports.  Freeports haven’t really been that successful in the recent past.  The commitment was however made before the Brexit withdrawal negotiations were complete and I wonder is there is a bonded-warehouse type-solution possible here to the “Percy Pig” type issues.  After all, that debacle must strike everybody (apart from those collecting the tariffs) as ludicrous.

I can’t lose sight however of the fact that the strategy also covers passengers as well as goods.  I would be the first to admit that the systems here need to be improved: airports, in particular, are an experience which few people love.  It is quite possible to spend three times as
long in the airport as one does on the actual flight.  Watching old films, I am always amazed how passengers handed over their luggage at the Victoria Air Terminal, boarded their coach, had the passports checked on the coach whilst on the way to Heathrow, and the coach drove right up to the steps of the plane. It’s the sort of seamless journey one can only dream about now.

However, although I am quite in favour of the goods I am exporting being tracked by technology from cradle to grave, I have considerable worries over more technology (e-passports) being rolled out to track people.  This is, I appreciate, a particularly British concern and maybe a generational one.  But any strategy is going to have to cope with the in-built suspicions of the UK to the surveillance society.

The consultation on the strategy is closed, but there is a lot of input that the Government is going to need if the strategy is going to work.  The Government has said this is to a team-exercise:  it is up to you and me, as business and individuals, to frame it in way which suits us.

(Malcolm Bacchus is an independent member of HMRC’s Administrative Burdens Advisory Board.  The views here are his own and do not seek to represent any official views.)

How you can lose money to scammers even if you are not trying

 

It is a few years ago now and some of the people concerned caught and prosecuted, so here is a story about identity theft and fraud which happened to me.  It  is a long story, so bear with me.  I think it will frighten you and has the advantage of being true.

How it all started

For a few weeks a number of odd things had happened.  I received two new bank cards and a new PIN  which I hadn’t asked for.  I’d also some couple of telephone calls which just cut off and one apparently from the bank - they put the phone down when my wife answered.  Then, late on a Friday afternoon, I had a call, again purporting to be from the bank, which made me very suspicious.  They clearly had some details about me and about the new card I’d requested (I hadn’t), so, just to be on the safe side, I called the bank and asked for a stop on all my cards.  Luckily, as it turns out, I got a confirmatory text from the bank almost immediately and I kept a screenshot of that as well.  The bank asked me to call in on Monday (the local branch was closed on Saturday) and arrange for a new card.

Something odd also happened over the weekend which I didn’t think too much about at the time – my mobile phone stopped working.  All it meant was two calls to make on the Monday before work – first to the bank then to the phone company.

Waited half an hour (of course) to see somebody in the bank as I didn’t have an appointment.  But, it was important:  I wanted a new working bank card. Eventually I saw a member of staff, who checked my passport and address ID, then told me that I had already gone into another branch in North London (I live in South London) on Saturday (hello, what’s happening here?) and had the cards re-activated or new cards issued, I never found out exactly which.

Large alarm bells ringing, now.  They checked my main account – lots of large transactions for jewellery from West End stores had been made over the weekend.  But, said the staff member, after a few internal telephone calls, we checked with you over the telephone because they were such large transactions and you confirmed it was all OK.  (Now I think I understand why my mobile stopped working). 

Put a stop on everything again, I said, and I’ll be back.  Off to the phone shop now.  After a lot of checking  they told me that I had gone in to a branch on Saturday and convinced them that my phone was lost and I needed a new phone and SIM on my old number.   That so explained that.  Very worried now, I went back to the bank.  There was clearly some very good social engineering going on here coupled with, I could only assume, fake ID in my name.  “No problem”, said the bank, “call in on Wednesday and we’ll have a member of our fraud team here to work it out”.

“It’s all sorted out”

Two anxious days later, I called into the bank.  No fraud team there.  “It’s all sorted out,” they said, “Your wife called and explained that she had made the transactions on your card.”  What?  We have separate accounts and she is not a signatory to my account.  Plus the fact that you put a stop on the cards and you told me on Monday that I had been shopping.  “Did you give her your PIN?”, they said.  “No I did not.  Nor did she go into the West End on Saturday.”  My wife, when I told her, was outraged.  Not only had I been impersonated in person, she had now been impersonated on the phone!

Whilst in the bank, we looked at my accounts again.  Since the bank had unlocked my account again, my current account had now been entirely cleared out.   Money had also been transferred from my other accounts into my current account and taken out of that.  Worse (if it can get worse) they had got into two other community accounts with which I was associated and withdrawing money from there by transferring that into my current account.  On one of those accounts, I had read only access and was not a signatory; on the other I was a signatory but only jointly with a second party and telephone/online banking had not been implemented.  I still do not know how this was done … but it was. 

Now I had no bank cards and no cash, and some difficult explanatory calls to make.  One of the two community organisations had wages to pay and no money now either; so I borrowed some money to re-imburse them, allowing them to do that, and a bit more for myself.  And then settled down to three months of letters, meetings, and statements to the police.

Why me?

The bank eventually refunded everything – we were talking six figure sums – they really didn’t have much of a defence having clearly been conned into disobeying my stop instructions twice.  However an additional £50 compensation for the weeks of inconvenience caused was just a little bit mean.

Some time after it was all over, the police came back and took another statement as they had (I think from what they implied) tracked the gang down.  I learnt a bit more about the methods involved.  It looks as if, a while before it all started, my card was cloned: I think I can now guess where.  After various attempts to get my PIN (hence the duplicate cards and the telephone calls) they decided on the fake identity route.

“Why me?“ I asked the police.  Apparently professional people, particularly if also company directors, are good targets.  They are likely to be moderately wealthy and therefore worth putting in a bit of effort for and there is likely to be quite a bit of information about them on line.  If your name is “John Smith”, you are probably safe as it is difficult to identify which John Smith you might be simply from the name on the card – but if you have an unusual name (and Malcolm Bacchus is an unusual name) it is much easier for fraudsters to find out sufficient information about you to produce at least some credible faked documentation.

What lessons were there?

So that it’s it.  Clearly it is impossible for an individual to prevent fraud on their bank accounts when the bank’s processes are at fault and I am assured by the bank that their processes are tighter now than when this happened.  Companies House too have stopped putting your full date of birth for all to see. But what can one learn from this?  Obviously there are the all normal things such as not giving out your PIN, not writing passwords down, being alert for suspicious telephone calls and not clicking on any unknown links on your computer, but I was fine on all of these and still got caught.  So here are my additional take-aways from the story:

• Split your funds across accounts with more than one bank
• If possible, don’t allow your bank to associate the various accounts you might have access to on their system in one place – it’s good for them but good for fraudsters too
• Again, if possible, and most of the time it isn’t, be careful about who you give copies of your ID to (everybody asks for them these days and whether they store them safely is anybody’s guess)
• Use invented answers to the security questions on all websites  – not your real first school or first pet (it didn’t happen in my case as far as I am aware, but I was warned that fraudsters are good at extracting that sort of information by social engineering
• For the same reason, don’t use the same answers or the same passwords on multiple sites
• Investigate anything odd on your account as soon as it happens: don’t assume it is a mistake
• Keep documentation on every contact with your bank, even if it was a short telephone call.

And what to do if it happens to you...

Obviously, always contact the bank as soon as you are suspicious.

If you are an ICAEW accountant you can get guidance for you or your clients on the New ICAEW Fraud Advisory Helpline on 01908 248 250; if you are a business speak to your accountant;  and, whether it was you or your business affected, always report the fraud to ActionFraud at actionfraud.police.uk or
0300 123 2040 (England and Wales only – otherwise your local fraud prevention organisation or the police). 

If you are an accountant you might also have to report on a SAT to the National Crime Agency and, as a business or accountant, for cyber crime, to the Information Commissioner’s office.

Smaller businesses: A chance to turn back the tide of regulation

 Do you:

• File a tax self-assessment for business (say as a sole-trader) or
• Have property income (such as rents) greater than £10,000 per annum?

If so, it will pay you to read on.

HMRC’s Making Tax Digital (MTD) regulations currently only apply to businesses registered for VAT with turnover greater than £85,000.  However, under their current plans, from April 2022 all tax payers who file income tax self-assessments for business or have property income of more that £10,000 per year will be brought into the net of MTD.

This will mean if you fall into either of these categories, from April 2022 you will need to keep your business or property records electronically and file quarterly returns within one month of the quarter’s end.

At present, if you are below the £85,000 VAT threshold, or not registered for VAT, you only need to complete your annual tax return, once a year, with nine months to do it in.

HMRC believes this will help your cash planning and make tax compliance less burdensome.  It’s a reverse engineered argument, of course, because the real reason is to try and close the tax gap and to cut down on HMRC operational costs through IT although to what extent it will do so and how much of the tax gap is due to these very small businesses and landlords is unknown and a matter for debate.

I think we can debate whether keeping records electronically for a small landlord with one property will actually improve their record keeping or not (£10,000 per annum income is, at the most, one property level in most cities, if not elsewhere) .  What is more questionable is whether forcing somebody to make a return five times a year (four quarterly and one annual return) will achieve anything at all.  What is beyond doubt is that five filings a year with four of those having a one month deadline will increase the workload and massively increase the sheer angst of being a small business or small property owner.

If you are a pensioner with a small property portfolio to supplement your meagre state pension – and a lot of people are in that position – then forget the four week holiday cruise you were saving up for:  you’ll need to employ an accountant or make sure your holiday doesn’t coincide with a state mandated quarter end.  And woe betide you if you fall ill.  These may be trivial examples and easy to deride, but they show how the state is continually becoming more and more demanding and less and less sympathetic.  There is no good reason for requiring vast numbers of small businesses to be given these sorts of deadlines when nine months has been felt to be reasonable before.

Mind you, if you don’t feel you want to buy and learn how to use accounting software by April 2022, you’ll need to employ that accountant to do the work for you in any case.  Time to put your prices or your rent up to cover the admin and angst.

The good news is that whilst this proposal was announced by HMRC last year, because of COVID-19, the changes necessary to implement it have not yet been included in a budget.

 So there is still time, if you think these demands are unacceptable, to let your MP know.

One local society's response to the planning changes

 

I'll confess that this post is less business related than some although the impact of planning changes will echo through the business community.  It follows on from my blog of my views on the future of the high street under the changes proposed by the Government in their recent consultation "Supporting housing delivery and public service infrastructure" which I discuss here.

Our local community group in South London  (I'll hold my hands up now in the interests of transparency - I chair it) responded to the Government consultation making the following major points:

• The proposals could result in a significant reduction in shops and small creative work units which are typically less profitable to developers than residential homes
• A reduction in the available of shopping premises will potentially exacerbate the demise of the local high street already under COVID pressures
• A reduction in creative workspace will similarly hinder the expansion of the enterprise economy much needed post-COVID and post Brexit
• Both these reductions run contrary to the idea of a "15 minute city" where everything is in reach without using cars
• The proposals would also have a significant impact on communities which has not been considered and considerably reduces community involvement in planning in their areas
• Local Councils should retain the ability to control the mix of residential/commercial/shopping within their areas to ensure that vibrant communities remain and this should not be left in the hands of developers
• Residents' views must be taken into account in larger scale change of use proposals which could affect their communities
• Protection must be included for Conservation Areas and any new rules should not override existing Article 4 protections
• There is no mention of s106 agreements which, given that this new right will apply to any size of conversion (potentially even converting a shopping centre into residential), means that considerable additional housing could be provided without any new funding for new schools, medical facilities, leisure, green space or the like
• Lack of income from s106 agreements (and potential reduced income from business rates) may place added financial burdens on Councils
• Reducing consultation times to 14 days on large infrastructure projects is unacceptable - it does not give long enough for the public to organise a considered response and, in some instances, where proposals are timed to coincide with holiday periods, entirely disenfranchise residents.

We were not alone in these views. Many local bodies as well as umbrella organisations such as the London Forum and Civic Voice, together with the Greater London Council and other local authorities,  have expressed concern over the proposals as has the British Property Federation.

Our society's full response can be read here.

How will the high street fare - new planning rules coming

 

One obvious effect of the coronavirus epidemic has been an accelerating trend of businesses leaving the high street, either through a decision to go on-line only or, more often, through insolvency.  

When insolvency beckons the remains tend to be picked over by on-line retailers: most recently Asos has bought the Topshop, Topman and Mis Selfridge brands from the failed Acadia; its Evans brand was bought by City Chic and Dorothy Perkins, Wallis and Burtons look like being bought by BooHoo.  None of these have expressed an interest in retaining the shopping estate and therefore some 12,000 jobs and around 500 shops are likely to go as a result.  All without taking into account the knock-on effect that the loss of these, often anchor, shops and the associated jobs will have on neighbouring businesses.

The government is now reviewing the comments made on its proposals to reform planning: “Supporting housing delivery and public service infrastructure”.  One of the major effects of its proposals would be to allow offices and shops to be turned into residential accommodation without the need for planning permission and therefore without local government control.  Government sees this as a significant way to boost housing stock and re-purpose disused shops.

There is considerable doubt however as to whether this will simply make matters worse.  A vibrant community is not made by cutting the heart out of its shopping centre and removing any effective control by the local authority developers will have an effective carte blanche to do what they will*.

There is no doubt on-line shopping is here to stay, but in many respects is less environmentally friendly than local shopping:  not least that it involves significantly more transportation and packaging.  But worse, the closure of high street arcades could move more shopping to bigger out-of-town units with lower operating costs and lower rates, just at the time we are seeking to reduce car usage.

Whilst outside the remit of the planning consultation, if the government wishes to keep city centres alive and compete with on-line retail, it is going to have to look at a radical reform of rates and business taxes.  A growing lobby of businesses are pressing for this and it is likely that only the combination of COVID-19 and Brexit has pushed it out of urgent consideration to date.  But COVID-19 is now making a change ever more urgent, so expect to see something in a future budget.

 __________________

* I wrote our local area’s response to these proposals, the summary of which are here.

To serve or not to serve ... that is the question

 

Number 1: how to retain a customer

Back last September, the heating system was having a few hiccups so I went to the local Screwfix Limited store (they had late opening) and purchased a fan heater over the counter.   It was fairly late, fairly cold and I still had work to do.

This December the heater broke down.  Being me, I took it apart to find out why.  A connector had not been properly insulated and had burnt through.  Naturally, of course, I couldn’t find the invoice (in my haste to use the heater I think I must have thrown in away in the packaging).  I resigned myself to writing off the cost.  In any event, according to the warranty I had voided that by
opening the casing.

I was concerned however about the manufacturing fault and so emailed Screwfix with photographs of the damaged component.  They replied asking for the purchase order number.  “Hello”, I thought, “this is going to be a bad experience” but I emailed back saying I didn’t have any purchase documentation. I told them them where and when I purchased the heater and I wasn’t trying to claim on the warranty, but I wanted the manufacturer to know that there could be a manufacturing fault.

The next day I got a reply.  Screwfix had traced my purchase, had credited back the purchase cost to my bank account and given me a voucher for a future purchase on top of that.  They had also checked their records of complaints and were satisfied it was one off fault.

Needless to say, I was impressed.  I’ve told others therefore about this and I am writing this blog to expand that reach.  They deserve it.  And I will be back to them again.

Number 2:  How not.

I have a set of headphones I use for video conferencing.  I’ve had them for years.  Not surprisingly their usage has gone up rather a lot recently.  In December, the foam ear-pieces started to fall apart.  The particular headphones were no longer made and it wasn’t clear from the manufacturer’s website which of their current ear-pieces would fit.  They don’t show dimensions on the web-site, of course, that would be too helpful: they only show part-numbers.  Pre COVID I would have called into a shop and asked.  But at present, there was nothing for it but to email the manufacturers.  

“Can you give the model number?” they responded. 
“Yes,”  I replied, “I already did in my original email along with the dimensions of the ear-pieces I need.”

“We don’t make that model any longer” they said.  “I know!” I replied, “I’m asking whether any of the ear-pieces you make for existing models would fit.”
“We’ll get back to you”….

Three days later I got an email:  “Which of the new models would you like ear-pieces for?”
“I DON’T KNOW.  I’m asking you.  Please – ears have not changed that much in shape in ten years, something must fit.”

I’ve still not had a reply.  How difficult is it to look at the dimensions I gave and compare them with those of the models they currently make?  Apparently extremely difficult.

In any case, we’ve made some replacements ourselves which work.  I’m not throwing away a perfectly good set of earphones because of incompetent sales people.  They’ve lost a small sale but, more importantly, I won’t be buying anything else from them for a long while.

Motto:  treat your customers with respect.

A less scrappy business

 

We have a Vauxhall Zafira which is now a few years old.  It ran perfectly until it failed its MOT as a small valve switch on the engine management system was acting up.  It didn’t actually stop the car from running but it meant that emissions could potentially breach ULEZ limits. 

The car is used for transporting lots of “junky” stuff for various projects and we would like to still have use of it.  Partly because of the expense of replacement, partly because we are quite fond the vehicle which has give us years of service, but mainly because the idea of replacing a whole car for the sake of a £50 component is simply horrible. 

But Vauxhall have stopped making the part.  All the spares companies have done likewise and we can’t find a breakers yard who will get one from a scrapped vehicle.  So it looks as if we will be forced into buying a new vehicle and scrapping the old.

This is, of course, what car manufacturers like us to do.

And it’s not only car manufacturers.  A component of our curtain rail (in a large bay window) broke.  It was a small plastic piece no more than a couple of centimetres long. You know where I am going with this: it’s no longer made and the equivalent component in the replacement system is incompatible (“improved” in sales-speak).  We could of course buy a whole new curtain rail, have it moulded to shape and installed at a cost running into hundreds of pounds. 

This does have a happy ending (I wish the first example could).  Our son had access to a 3D printer and we scanned the parts of the broken component in, tidied it up in FreeCAD, and printed a new one.  Works perfectly.  Cost: 3 hours of spare time (mainly learning how to use FreeCAD) and about £1 worth of plastic or less; installation time 10 minutes.  So if we can make replacements to order, why can’t the company?  At the very least, it could publish the template for such components so consumers could print them directly.  It won’t, of course, it wants the profits from forcing us to buy new.

I loathe, as you may gather, the throw-away society.  So it comes with some relief to read that IKEA has seen the light and plans to sell replacement parts such as chair legs and arm rests for its furniture, although those plans are at an early stage.  The company already buys back certain used items, such as its Billy bookcases, for resale or recycling if they cannot be sold, but this is a welcome extension of sustainability from the world’s largest furniture business.

As consumers we need to encourage all other businesses to ensure that their products are repairable and reusable for longer.  We need to look at retaining and repairing products rather than disposing of them.  Landfill sites are still full of mobile phones, upgraded every year by throwing away the old and buying the new.  The seas are full of micro-plastics much of which comes from plastic
clothing, worn for a season or two and discarded.  I could go on.  I confess that I have my own limits on ecology:  the car is too useful to give up, but manufacturer could do a lot more to help us (and the planet) and it is up to us to insist they do.  So, well done, IKEA.