Cont: Brexit: Now What? Part 5

Status
Not open for further replies.
ceptimus said:
You see no reason to think that £20 billion isn't an accurate estimate? I'm not sure what period the £20 billion is supposed to be spent over - is it yearly? Let's be generous and assume it's for a ten year period so that's "only" £2 billion per year. If we employ people full time for this task (whatever it is) and pay them each £40,000 salary to do it, that's fifty thousand people employed doing this work.


Maybe you think that's reasonable? I don't.
Click to expand...
It is £20bn year. As explained "HMRC have looked at the new declarations and costs for five different groups of businesses differentiated by their trade volumes and use of intermediaries. Costs vary between £15 and £55 per declaration. The additional number of estimated customs declarations is 205m for current intra-EU trade."

The remaining charge is for extra rules of origin costs which has been calculated from "Ciuriak (2014)which concluded that a plausible range for only the administrative costs imposed by rules of origin is between 1% and 7% relative to the value of the exported good under preference. Cadot et al (2006) concluded that the total trade weighted costs imposed by rules of origin is between 7-8% for trade eligible for preferences, for the two rules of origin regimes they consider in their analysis."

Rather than resorting to argument from incredibility and innumeracy perhaps you could suggest where the official Government estimates are wrong.

I will even offer to help in that using your £40k a year worker. It will create 500,000 extra jobs, albeit that it for current trade so those extra jobs will not result in any extra sales. To cover the cost of extra employees prices will have to increase and that will reduce demand for sales. Lower sales in turn means the additional costs are lower . So rather than £20bn a more realistic figure is £17-20bn.

Oh wait, that is exactly what Jon Thompson said.
 
So maybe only another 350,000 or so new jobs then :) and with that third of a million people employed full time filling in extra paperwork, I'm sure the EU or whatever agency receives the paperwork will have plenty of capacity to process it all.

Dream on.
 
ceptimus said:
So maybe only another 350,000 or so new jobs then :) and with that third of a million people employed full time filling in extra paperwork, I'm sure the EU or whatever agency receives the paperwork will have plenty of capacity to process it all.

Dream on.
Click to expand...
it is not a system issue or a cost once the information is prepared. The system is up and running already. It is a cost issue for exporters to prepare the information to go into the system. If a new rule said all letters must have a hand drawn picture of the sender on the envelope it would not affect the post office only those sending letters.

It is admirable that you can form such strong views on issues you don't understand.
 
Last edited:
I understand it well enough to confidently predict that the forecast is rubbish.


There will not be an extra third of a million new jobs created filling in paperwork. If there were, it would be impossible for the receiving agency to process it all. They would have to just burn it or dump it without looking at more than a tiny sample. The people producing the paperwork would know that, so could shortcut the hand drawn pictures part and just post blank pieces of paper instead - this would, of course, mean that they could do the job with many fewer people.


Sensible heads would prevail and the whole system would be scrapped as unwieldy and useless. Any records that did need to be supplied would, in the vast majority of cases, be generated by computers and supplied to other computers without any paper being involved.


The Project Fear prediction, will be revealed, like all the others, to be a ludicrously inflated over estimate of the true costs - which may end up being 1% or so of the threatened "up to" £20 billion.


Of course, when the true costs turn out to be say, £10 million, then the overpaid idiot that produced the forecast will be able to claim that his forecast was correct as £10 million is indeed encompassed by a forecast of "up to £20 billion". As I hinted in an earlier post he might just as well have said "up to twenty thousand trillion pounds per day" - that would be an equally accurate estimate.
 
ceptimus said:
I understand it well enough to confidently predict that the forecast is rubbish.


There will not be an extra third of a million new jobs created filling in paperwork. If there were, it would be impossible for the receiving agency to process it all. They would have to just burn it or dump it without looking at more than a tiny sample. The people producing the paperwork would know that, so could shortcut the hand drawn pictures part and just post blank pieces of paper instead - this would, of course, mean that they could do the job with many fewer people.


Sensible heads would prevail and the whole system would be scrapped as unwieldy and useless. Any records that did need to be supplied would, in the vast majority of cases, be generated by computers and supplied to other computers without any paper being involved.


The Project Fear prediction, will be revealed, like all the others, to be a ludicrously inflated over estimate of the true costs - which may end up being 1% or so of the threatened "up to" £20 billion.


Of course, when the true costs turn out to be say, £10 million, then the overpaid idiot that produced the forecast will be able to claim that his forecast was correct as £10 million is indeed encompassed by a forecast of "up to £20 billion". As I hinted in an earlier post he might just as well have said "up to twenty thousand trillion pounds per day" - that would be an equally accurate estimate.
Click to expand...
Clueless. You think the EU will scrap the system that it relies on to calculate import tarrifs because it can't cope with the capacity of extra declarations arising from brexit :D
 
Lothian said:
Clueless. You think the EU will scrap the system that it relies on to calculate import tarrifs because it can't cope with the capacity of extra declarations arising from brexit :D
Click to expand...
Yes, certainly they will have to scrap that part of it that relies on huge volumes of paper. As I already said, they wouldn't be able to process that volume of paper.


The only solutions are:
1. Stop the vast majority of the trade so that there is capacity to process the paperwork resulting from the tiny fraction of remaining trade.
2. Scrap the system altogether and have some sort of free trade system that doesn't need it.
3. (and perhaps the most likely) Have the declarations made and dealt with automatically by computers.


No matter how much you support the EU, you still have to live in the real world. A third of a million people filling in paperwork and however many people are required to receive and process that paperwork is not reality.
 
ceptimus said:
I understand it well enough to confidently predict that the forecast is rubbish.


There will not be an extra third of a million new jobs created filling in paperwork. If there were, it would be impossible for the receiving agency to process it all. They would have to just burn it or dump it without looking at more than a tiny sample. The people producing the paperwork would know that, so could shortcut the hand drawn pictures part and just post blank pieces of paper instead - this would, of course, mean that they could do the job with many fewer people.


Sensible heads would prevail and the whole system would be scrapped as unwieldy and useless. Any records that did need to be supplied would, in the vast majority of cases, be generated by computers and supplied to other computers without any paper being involved.


The Project Fear prediction, will be revealed, like all the others, to be a ludicrously inflated over estimate of the true costs - which may end up being 1% or so of the threatened "up to" £20 billion.


Of course, when the true costs turn out to be say, £10 million, then the overpaid idiot that produced the forecast will be able to claim that his forecast was correct as £10 million is indeed encompassed by a forecast of "up to £20 billion". As I hinted in an earlier post he might just as well have said "up to twenty thousand trillion pounds per day" - that would be an equally accurate estimate.
Click to expand...
Clueless. You think the EU will scrap the system that it relies on to calculate import tarrifs because it can't cope with the capacity of extra declarations arising from brexit :D

Oh and if you understood the system well enough you would know it is not paper based.
 
ceptimus said:
Yes, certainly they will have to scrap that part of it that relies on huge volumes of paper. As I already said, they wouldn't be able to process that volume of paper.


The only solutions are:
1. Stop the vast majority of the trade so that there is capacity to process the paperwork resulting from the tiny fraction of remaining trade.
2. Scrap the system altogether and have some sort of free trade system that doesn't need it.
3. (and perhaps the most likely) Have the declarations made and dealt with automatically by computers.


No matter how much you support the EU, you still have to live in the real world. A third of a million people filling in paperwork and however many people are required to receive and process that paperwork is not reality.
Click to expand...
It is an electronic system that processes the inputs automatically.
The cost to businesses is to complete the electronic forms.
No matter how much you hate the EU you should acquaint yourself with the real world.
 
Last edited:
I live in the real world, and, like you, will continue to live in it after Brexit. We will see then who was right.
 
ceptimus said:
I live in the real world, and, like you, will continue to live in it after Brexit. We will see then who was right.
Click to expand...
Well I think we can already agree you know nothing about the EU import export system and the costs to business in using it. We can take your incredulity as to the Government figures as an indication of your lack of understanding the brexit effects not theirs.
 
Belgian thought said:
True, but a delivery note is not a document for customs clearance.
Click to expand...

True, but much of the information

This customs document is valid internationally and as well as describing the goods, their shipper and their destination
Click to expand...

will be common. Customs classification of the goods will be extra, but can be attached to the goods description in a computerised stock system.
 
Lothian said:
Rather than resorting to argument from incredibility and innumeracy perhaps you could suggest where the official Government estimates are wrong.

I will even offer to help in that using your £40k a year worker. It will create 500,000 extra jobs, albeit that it for current trade so those extra jobs will not result in any extra sales.
Click to expand...

The other interesting wrinkle is the statement that trade with the rest of the world (which requires customs paperwork) is roughly equivalent to the value of EU. This seems to imply, using HMRC's approach, that there are several hundred thousand people already employed solely on customs declarations, subject of course to assumptions about average consignment size.
 
Aber said:
The other interesting wrinkle is the statement that trade with the rest of the world (which requires customs paperwork) is roughly equivalent to the value of EU. This seems to imply, using HMRC's approach, that there are several hundred thousand people already employed solely on customs declarations, subject of course to assumptions about average consignment size.
Click to expand...
I think you are perhaps making the same mistake as ceptimus. The HMRC statement was about costs for business not for the EU tax authorities.
Or alternatively if you are talking about business costs I agree with you :) There are thousands of people all over the world dealing with the documents required to import and export into the EU. 100,000's is possibly too high. That figure came from ceptimus's assumption the only cost was employees on a £40k salary. In reality there will be a variety of costs businesses would include in calculating the costs of a declaration. Large businesses would have a team with the usual infrastructure to house them. Smaller business's costs will mostly be fees from customs agents to do the declarations for them.

Added. A quick online search threw this up at the top of the list. They charge £29 a go, suggesting that they are better than the 'sharks' who will charge far more. I think the HMRC calculation was around £30 as the average.
 
Last edited:
Lothian said:
Large businesses would have a team with the usual infrastructure to house them. Smaller business's costs will mostly be fees from customs agents to do the declarations for them.
Click to expand...

Agreed.

Remember that HMRC is an arm of government, and their analysis comparing Chequers and a Free Trade Deal might not be entirely impartial. The Chequers proposal for UK importers to reclaim excess EU customs duty from HMRC by proving that the goods had not gone to the EU is a nightmare, but they have downplayed the costs of it.
 
Lothian said:
To cover the cost of extra employees prices will have to increase and that will reduce demand for sales. Lower sales in turn means the additional costs are lower . So rather than £20bn a more realistic figure is £17-20bn.

Oh wait, that is exactly what Jon Thompson said.
Click to expand...
No, the 17-20bn is the ball park for the extra cost. I don't think he provided any estimates on how much trade would be depressed.
 
Lothian said:
That figure came from ceptimus's assumption the only cost was employees on a £40k salary. In reality there will be a variety of costs businesses would include in calculating the costs of a declaration.
Click to expand...
Just for the sake of fairness: Aber made this up. Ceptimus just ran with it.
 
Status
Not open for further replies.

Back
Top Bottom