A new £24m border control post may have to be demolished because repeated changes to post-Brexit border arrangements have left it commercially unviable.
The facility at Portsmouth International Port is due to begin physical checks on food and plant imports from the EU at the end of next month, but changes to border protocols since it was built mean half of the building will never be used.
Built with a £17m central government grant and £7m from Portsmouth City Council, which owns the port, it is designed to carry out checks on up to 80 truck loads of produce a day. The port now expects to process only four or five daily.
As a consequence, half of the 14 loading bays will never be used, and annual running costs of £800,000 a year will not be covered by the fees charged to importers for carrying out checks.
Portsmouth is not alone, with ports across the country puzzling over how to make the over-sized, over-specified buildings commissioned by the government pay for themselves with far less traffic.
The Department for Environment, Food and Rural Affairs says it spent £200m part-funding new facilities to cope with post-Brexit border controls at 41 ports. It acknowledges that fewer checks will now be required and says ports are free to use spare capacity as they wish.
The problem in Portsmouth is that the facility, built for a very specific purpose inside a secure area, has no obvious commercial use, so the port is considering building a new, smaller facility, and decommissioning or even demolishing the existing building to make space for a commercially viable project.
Image: The new border control post in Portsmouth
“This was built to a Defra [Department for Environment, Food and Rural Affairs] specification when the border operating model was announced and it’s been mothballed for two years while the checks were delayed,” Mike Sellers, director of Portsmouth International Port and chairman of the British Ports Association, told Sky News.
“Now the border will be operating with far fewer checks, we are going to struggle to cover the running costs of around £800,000 a year.
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“So we have to look to the future and work out what strategically is the best way to minimise the impact to the port and to the council.
“I know it sounds ironic, but that could be building another border control post much smaller than this facility, and looking to find commercial ways to get income either through this facility or to demolish it and use the operational land for something else.”
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Port owner Portsmouth City Council meanwhile wants its £7m share of the £24m build cost reimbursed by the government.
“We as a council had to find £7m to help build this facility and now we’re on the fifth change of mind about how much inspection there will be. Half of this building is going to be left empty, idle, unused, and yet it’s costing council taxpayers of Portsmouth a great deal of money,” said councillor Gerald Vernon-Jones, transport lead for the council.
Were the Portsmouth facility to close it could impact the security of UK food imports, as the port is the main alternative route to Dover, providing much-needed resilience to a supply chain heavily reliant on the Short Straits route.
“It’s a total and absolute mess, we have an enormous white elephant here,” Mr Vernon-Jones said.
“If we can’t afford to keep port health people here all day, every day, to do those examinations then everything will have to come through Dover, and that’s enormously risky for this country. If Dover is closed for some reason, industrial action or whatever, then the whole country’s food is at ransom.”
Image: Portsmouth is the UK’s second busiest cross-Channel port
The British Ports Association meanwhile has raised concerns with ministers about the preparedness of the new inspection regime at new border control posts (BCPs), due to be enforced in less than six weeks.
The trade body says ports have still not been told what hours BCPs will be required to open, or how many staff from two state inspection agencies will be required on site.
Crucially, they also do not know how much they will be able to charge importers for inspections because the government has not revealed what price it will levy at the wholly state-owned and run BCP at Sevington in Kent, 20 miles inland from Dover.
Given the dominance of Dover in UK food imports, the so-called common user charge will set the price for the rest of the market, but other ports still have no idea where to set fees.
Defra says it will inform the industry shortly of the fees it has determined following consultation.
The fate of the Portsmouth facility, obsolete before it has even opened, symbolises the delay and indecision around import controls since the Brexit deal came into force in January 2021.
While UK exports to the EU have faced border and customs controls since 1 January 2021, the UK government has delayed similar checks on EU imports five times and changed the control regime.
The original July 2021 deadline for physical checks of plant and animal produce was postponed because the BCPs were not ready, and further delays followed, with the government citing the impact on the food supply chain and the cost of living crisis.
In April 2022 the government announced a wholesale revision of its plans for the border, introducing a new risk-based approach that limits checks to certain high and medium-risk food and plant categories.
This was then delayed again, with a staged introduction finally beginning in January, with medium-risk food and plant imports requiring health certificates signed off by vets or plant health inspectors, followed by physical checks from 30 April.
Even with reduced checks on importsm the government’s own analysis suggests border controls will add £330m a year to the cost of trading with the continent and increase food inflation.
A spokesperson for the Department for Environment, Food and Rural Affairs said: “Our border control posts have sufficient capacity and capability, including for temperature controlled consignments, to handle the volume and type of expected checks and the authorities will be working to minimise disruption as these checks are introduced.”
The investment firm which has become this year’s most prolific buyer of high street chains in Britain is targeting a takeover of a privately owned footwear retailer.
Sky News has learnt that Modella Capital is in advanced talks to buy Wynsors World of Shoes, which trades from approximately 50 standalone shops across the north of the country.
Retail industry sources said that Modella was now the likeliest buyer of Wynsors, with a deal potentially being struck before the end of the year.
Wynsors has been exploring a sale for the last two months, and hired the accountancy firm RSM to explore interest from prospective bidders.
The chain also trades from about 40 concession sites, and employs roughly 440 people.
It has a particular focus on the children’s school shoes segment of the footwear market.
Like many retailers, it is understood to have seen its recent performance adversely affected by the labour cost pressures heralded by last year’s Budget.
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If the deal is completed, it would add Wynsors to a stable of brands which includes TG Jones, the new name for WH Smith’s high street chain; Hobbycraft; and The Original Factory Shop.
Modella was also one of the bidders for Poundland, which was sold during the summer to Gordon Brothers, another specialist retail investor.
A spokesman for Modella declined to comment, while RSM has been contacted for comment, and Wynsors could not be reached for comment.
A senior executive at Netflix is among the contenders vying to become the next boss of Channel 4, the state-owned broadcaster.
Sky News has learnt that Emma Lloyd, the streaming giant’s vice-president, partnerships, in Europe, the Middle East and Africa, is one of a handful of media executives shortlisted to replace Alex Mahon as Channel 4’s chief executive.
Ms Lloyd, whose previous employers included Sky, the immediate parent company of Sky News, also served on the board of Ocado Group, from which she stepped down this month after nine years as a non-executive director.
She is understood to be a serious contender to take the helm at Channel 4, with other candidates understood to include Jonathan Allan, the interim chief executive who has also been its chief commercial officer and chief operating officer.
The identities of others involved in the recruitment process was unclear this weekend.
The appointment of a successor to Ms Mahon, Channel 4’s long-serving boss, comes at an important time for the company, and the broader public service broadcasting sector.
Recruitment to the board of Channel 4 is technically led by Ofcom, the media regulator, in agreement with the culture secretary, Lisa Nandy, although the process to land a new chief executive is being steered from within the company.
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In September, Geoff Cooper, who chairs the online electrical goods retailer AO, was named Channel 4’s next chairman.
He replaced Sir Ian Cheshire, the former Kingfisher boss, who held the role for a single three-year term.
Channel 4 saw off the prospect of privatisation under the last Conservative government, with Ms Mahon a particularly vocal opponent of the move.
Nevertheless, Channel 4, which is funded by advertising revenues, faces significant financial challenges amid shifting – and in many cases waning – consumption of traditional television channels.
In the aftermath of a sale of the company being abandoned, its board last year unveiled Fast Forward, a five-year strategy designed to “elevate its impact across the UK and stand out in a world of global entertainment conglomerates and social media giants”.
“While getting ourselves into the right shape for the future is without doubt the right action to take, it does involve making difficult decisions,” Ms Mahon said at the time.
“I am very sad that some of our excellent colleagues will lose their jobs because of the changes ahead.
“But the reality of the rapid downshift in the UK economy and advertising market demand that we must change structurally.
“As we shift our centre of gravity from linear to digital our proposals will focus cost reductions on legacy activity.”
Ms Mahon’s departure earlier this year saw her quit to run Superstruct, a music festival business owned by private equity backers.
In recent weeks, her name has been linked with the BBC director-general’s post, which is soon to be vacated by Tim Davie.
Mr Davie announced this month that he would step down amid fierce criticism of the Corporation’s handling of a misleadingly edited speech made by President Donald Trump, which was included in an edition of the current affairs programme last year.
The public service broadcasting arena will also undergo significant change if a prospective bid by Sky for the television arm of ITV progresses to a definitive transaction.
Talks between the two companies emerged earlier this month.
In addition to the corporate developments in British broadcasting, the government has also confirmed a Sky News report that a search for a successor to Lord Grade, the Ofcom chairman, is under way.
On Saturday, Netflix declined to comment on Ms Lloyd’s behalf.
The government is lining up bankers to conduct a review of options for Britain’s embattled steel industry amid calls for ministers to orchestrate mergers between some of the sector’s biggest players.
Sky News has learnt that Evercore, the independent investment bank which now employs George Osborne, the former chancellor, was expected to be appointed in the coming weeks to oversee a strategic review of the sector.
If its appointment is confirmed, Evercore will report its findings to Peter Kyle, the business secretary, and UK Government Investments (UKGI), the Whitehall agency which manages taxpayers’ interests in a range of companies, including the Post Office and Channel 4.
The talks with Evercore come as the steel industry contends with the impact of President Trump’s tariff war and the prospect of retaliatory measures from the European Union.
The move to recruit bankers for a key review of Britain’s struggling steel sector also comes during a period when the government has significant financial exposure to all of the country’s three largest steel producers.
Last year, ministers agreed to provide £500m in grant funding to Tata Steel, the Indian company, to install an electric arc furnace at its Port Talbot steelworks in Wales.
The new facility is expected to be operational in 2027, but has been bitterly opposed by trade unions infuriated that the new funding was effectively used to drive through thousands of redundancies at the plant.
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In April, the then business secretary, Jonathan Reynolds, moved to seize control of British Steel after its Chinese owner, Jingye Group, threatened to close the UK’s last-remaining blast furnaces at its site in Scunthorpe.
The move sparked a diplomatic row with Beijing, with Jingye considering various legal options in an attempt to secure compensation for its shares in the company.
Last month, ministers disclosed that the cost of taking control of British Steel had risen to £235m, in addition to a £600m bill for preserving its future in 2019 and 2020 when the company fell into insolvency under its previous owner.
The government’s move prevented the immediate loss of more than 3,000 jobs, although there remain questions about the company’s viability as a standalone entity.
Some advisers believe that a combination of British Steel with other industry players, including Sheffield Forgemasters, which is also in government control, will be a necessary step to preserving steelmaking capacity in the UK.
People familiar with the plans said that a newspaper report this month suggesting that bankers were being recruited by the government to sell British Steel was “wrong”.
“The UK government doesn’t own British Steel; it’s hard to sell an asset you do own,” they said.
Nevertheless, it remains conceivable that the government will at some stage be able to determine the future ownership of the industry’s second-largest company, amid recent suggestions that Beijing could be willing to cede Jingye’s claim to the company in return for Sir Keir Starmer’s approval of a controversial new Chinese embassy in Central London.
“We continue to work with Jingye to find a pragmatic, realistic solution for the future of British Steel,” Chris McDonald, the industry minister, said in a statement to parliament this month.
“Our long-term aspiration for the company will require co-investment with the private sector to enable modernisation and decarbonisation, safeguard taxpayers’ money and retain steelmaking in Scunthorpe.”
Britain’s third-largest steelmaker, Speciality Steels UK (SSUK), is also effectively in government hands, having been placed into compulsory liquidation during the summer.
The business was part of Liberty Steel, which is owned by GFG, the metals empire of businessman Sanjeev Gupta.
In August, a judge declared SSUK as “hopelessly insolvent”, with a special manager now overseeing an auction of the business, which employs about 1,500 people.
A spokesperson for the Department for Business and Trade (DBT) said: “This government sees a bright and sustainable future for steelmaking in the UK, and we’ll set out our long-term vision for the sector in our upcoming Steel Strategy.”
Sources said that that strategy was likely to be published either next month or early in the new year.