Portsmouth’s new Brexit border post could be demolished – without ever being used
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.
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.
“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.”
‘Total and absolute mess’
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.”
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.
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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 ripping up of the trade rule book caused by President Trump’s tariffs will slow economic growth in some countries, but not cause a global recession, the International Monetary Fund (IMF) has said.
There will be “notable” markdowns to growth forecasts, according to the financial organisation’s managing director Kristalina Georgieva in her curtain raiser speech at the IMF’s spring meeting in Washington.
Some nations will also see higher inflation as a result of the taxes Mr Trump has placed on imports to the US. At the same time, the European Central Bank said it anticipated less inflation from tariffs.
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Earlier this month, a flat rate of 10% was placed on all imports, while additional levies from certain countries were paused for 90 days. Car parts, steel and aluminium are, however, still subject to a 25% tax when they arrive in the US.
This has meant the “reboot of the global trading system”, Ms Georgieva said. “Trade policy uncertainty is literally off the charts.”
The confusion over why nations were slapped with their specific tariffs, the stop-start nature of the taxes, and the rapid escalation of the tit-for-tat levies between the US and China sparked uncertainty and financial market turbulence.
“The longer uncertainty persists, the larger the cost,” Ms Georgieva cautioned.
“Unusual” activity in currency and government debt markets – as investors sold off dollars and US government debt – “should be taken as a warning”, she added.
“Everyone suffers if financial conditions worsen.”
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These challenges are being borne out from a “weaker starting position” as public debt levels are much higher in recent years due to spending during the COVID-19 pandemic and higher interest rates, which increased the cost of borrowing.
The trade tensions are “to a large extent” a result of “an erosion of trust”, Ms Georgieva said.
This erosion, coupled with jobs moving overseas, and concerns over national security and domestic production, has left us in a world where “industry gets more attention than the service sector” and “where national interests tower over global concerns,” she added.
US stock markets suffered more significant losses on Wednesday, with stocks in leading AI chipmakers slumping after firms said new restrictions on exports to China would cost them billions.
Nvidia fell 6.87% – and was at one point down 10% – after revealing it would now need a US government licence to sell its H20 chip.
Rival chipmaker AMD slumped 7.35% after it predicted a $800m (£604m) charge due to its MI308 also needing a licence.
Dutch firm ASML, which makes hardware essential to chip manufacturing, fell more than 5% after it missed order expectations and said US tariffs created uncertainty.
The losses filtered into the tech-dominated Nasdaq index, which recovered slightly to end 3% down, while the larger S&P 500 fell 2.2%.
Pic: AP
Such losses would have been among the worst in years were it not for the turmoil over recent weeks.
It comes as China remains the focus of Donald Trump’s tariff regime, with both countries imposing tit-for-tat charges of over 100% on imports.
The US commerce department said in a statement it was “committed to acting on the president’s directive to safeguard our national and economic security”.
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Nvidia’s bespoke China chip is already deliberately less powerful than products sold elsewhere after intervention from the previous Biden administration.
However, the Trump government is worried the H20 and others could still be used to build a supercomputer in China, threatening national security and US dominance in AI.
Nvidia said the move would cost it around $5.5bn (£4.1bn) and the licensing requirement would be in place for the “indefinite future”.
Nvidia’s recently announced a $500bn (£378bn) investment to build infrastructure in America – something Mr Trump heralded as a victory in his mission to boost US manufacturing.
However, it appears to have been too little to stave off the new restrictions.
Pressure has also come from the Democrats, with senator Elizabeth Warren writing to the commerce secretary and urging him to limit chip sales to China.
Meanwhile, the head of US central bank also warned on Wednesday that US tariffs could slow the economy and raise inflation more than expected.
Jerome Powell said the bank would need more time to decide on lowering interest rates.
“The level of the tariff increases announced so far is significantly larger than anticipated,” he said.
“The same is likely to be true of the economic effects, which will include higher inflation and slower growth.”
Predictions of a recession in the US have risen significantly since the president revealed details of the import taxes a few weeks ago.
However, he subsequently paused the higher rates for 90 days to allow for negotiations.
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