Michael Gove, the minister tasked with no-deal Brexit planning, has said the government is ready to take the UK out of the EU without an agreement, hours after a bitter war of words broke out over the state of Brexit talks.
Gove said in a statement to the Commons that he was impressed by the steps manufacturers and supermarkets had taken to prepare for no deal, and by measures put in place by the ports of Dover and Calais and the automotive sector.
However, he said risks remained, some challenges for businesses could not be avoided, and sheep farmers and Northern Irish dairy farmers were likely to be adversely affected by tariffs.
“Of course risks remain and challenges for some businesses cannot be entirely mitigated, even with every possible preparation in place. But the UK economy is in a much better position to meet those risks and challenges thanks to the efforts of these sectors and companies and the chancellor,” he said.
The health secretary, Matt Hancock, has set up a “trade and readiness support unit” to ensure the supply of medical products, and HMRC will write to 180,000 businesses setting out how to import and export from and to the EU after Brexit.
The government will introduce lower tariffs on HGVs entering the UK. There will be adjustments to the duty paid on bioethanol to support UK producers, and some clothing will face tariffs to make sure there is still preferential access to the UK market for developing countries.
Beyond trade, Gove touched pointedly on citizens’ rights, challenging the EU to match the UK’s “generosity” and “flexibility”. “So far very few EU member states have made as generous an offer to UK nationals as the UK has made to EU citizens,” he said.
“We don’t believe citizens rights should be used as a bargaining chip in any scenario. EU citizens in the UK are our friends and family. We want them to stay. We now hope that the EU extends the same hand of friendship towards UK nationals as we have to EU nationals.”
The shadow Brexit secretary, Keir Starmer, said Gove’s statement resembled a “reassuring bedtime story” about no deal, which he said would be a disaster for the UK economy. He said some of the sectors and businesses that Gove had said were ready had given warnings that they were not.
On the souring relations with the EU, Starmer said: “Talks with the EU are collapsing as we speak. The proposals the government put forward last week were never going to work. Instead of reacting to the challenge by adapting the proposals, the government is intent on collapsing the talks and engaging in a reckless blame game, and it will be working people who pay the price.”
Stephen Phipson, the chief executive of Make UK, the manufacturers’ organisation, said he was concerned that some sectors of the economy would be affected despite the preparations.
“Some sectors will be dealt an especially hard blow at a time when others are imposing tariffs on us but we are dropping ours,” he said. “In particular, the automotive sector, which is one of the jewels in the crown of high-value manufacturing, faces being severely impacted by these plans. This will prove devastating for jobs and growth in the companies and regions who depend on its success.”
Adam Marshall, the director general of the British Chambers of Commerce, said it was good that government had got its “shoulder to the wheel” but businesses still had many detailed and complex questions about how they would trade successfully in the event of no deal.
He said: “Business concern about an unwanted no-deal exit is rising, particularly given developments over recent days. Both sides need to redouble their commitment and do everything in their power to avoid this in the short time we have left.”
On trade, Marshall added: “The latest temporary tariff regime only contains three changes, so businesses will be frustrated that it took government so long to publish the updates – needlessly extending uncertainty around the entire future tariff schedule. The delay has real-world impacts for businesses trying to plan for the unwanted prospect of a no-deal in a matter of weeks.”
Scotland’s deputy first minister, John Swinney, accused the UK government of making planning for no deal “unnecessarily difficult”.
Announcing the establishment of a Scottish medicines shortage response group and a £7m rapid poverty mitigation fund, Swinney told MSPs at Holyrood that the UK government’s approach had been “to actively limit the analysis shared with us, to exclude the Scottish government from decision-making, and to fail to share with us its own plans for actions to mitigate no deal”.
Swinney also announced plans to use the old port in Stranraer, on the key Northern Irish ferry route, to hold up to 300 HGVs should traffic flows between Northern Ireland and Scotland increase to that extent, and said farmers and crofters were receiving 95% of their common agricultural policy payments early to shield them from the immediate effects of crashing out of the EU without a deal at the end of the month.