Business, Freight News, Logistics

Lack of cash ‘putting customs service at risk’

[ July 10, 2013   //   ]

Funding cuts are threatening the ability of HM Revenue and Customs do do its job of protecting government revenue, warns Peter MacSwiney. Lack of money is inhibiting the service’s ability to keep proper control of cargo, and fraudsters would prosper as a result, he says.

Already, there is a growing disconnect between customs policy and what actually happens at the frontier, he complains. “The people who determine the law are increasingly disconnected from the people responsible for applying the law,” he states.

Lack of money is at the heart of the problem, he explains. “For example, when a new CIP is issued, the Border Force interpret it their own way. What is agreed at policy level with HMRC is not necessarily implemented as it was conceived. Of course, there has always been ‘interpretive legislation’ but despite efforts within the trade to address the issues it appears we are going backwards again, and the main reason is because everyone is so under-resourced.”

While HMRC’s single most important objective is to ensure that correct revenue is paid at the correct time, “what’s happening now is HMRC is being constrained by the Treasury and unless an initiative specifically raises revenue, it doesn’t get funded. Also, customs staff have been reduced so drastically they have reached a stage now where it’s questionable if they can do the job.”

He cited delivery of the fall-back system for the CCS UK, which was delivered 11 months late due, MacSwiney argues, “in no small measure down to lack of consistent resource from HMRC to test the system.”

He continues: “Currently, there are various regimes that do not run effectively. Consider the need to have the correct guarantees in place to move transit cargo between airports and removals to ERTS. The Border Force is now unable to see who has the guarantees because they are not part of HMRC; conversely, HMRC has the guarantees but doesn’t know who is moving goods.”

He says that cutting staff levels “leaves HMRC without the knowledge and resources necessary to do the job” including deterring fraudulent operators:

“It’s the threat that HMRC will come and chat to you that keeps most people honest.” But if that threat vanishes, the crooks will take advantage, MacSwiney warns.

“HMRC may soon be in a position where they won’t be able to deliver meaningful services. If they’re not already – they soon will be.”