Boris Johnson's government told to take its 'head out of the sand' and avoid a double winter crisis of Brexit and the coronavirus

  • The Labour Party is urging Boris Johnson's government to avert a national crisis this winter of damage done by the coronavirus compounded by chaotic exit from the European Union.
  • Concern is growing among British businesses about the disruption that potentially awaits the UK at the end of the Brexit transition period.
  • UK and EU negotiators are a long way from striking a trade deal before the transition period expires.
  • Labour's Rachel Reeves said her opposite number Michael Gove needed to "remove his head from the sand" and listen to concerns about the damage a no-deal exit would do.
  • "Large parts of the economy are already on their knees and the last thing they need is another shock to the system," she told Business Insider in an interview.
  • Visit Business Insider's homepage for more stories.

Boris Johnson's government has been urged by the opposition Labour party to remove its "head from the sand" and negotiate a close trading relationship with the European Union in order to avoid a double Brexit crisis of border chaos and food shortages in the coming winter.

Rachel Reeves, Labour's Shadow Chancellor of the Duchy of Lancaster, told Business Insider in an interview this week that the UK government is leading the country into a potentially disastrous New Year.

She said the economic damage caused by the coronavirus outbreak risks being compounded by an abrupt exit from the EU's trading rules.

Reeves, the opposite number to Michael Gove, the UK minister responsible for preparing Britain for the end of the Brexit transition period, warned that "business, consumers, and families have gone through a torrid year and can't afford anymore disruption."

The member of Parliament for Leeds West spoke to Business Insider after a week in which the scale of potential disruption facing Britain when it leaves the Brexit transition period at the end of the year became clearer.

Eleven logistics companies wrote to Gove, demanding an urgent meeting with him and Rishi Sunak, the Chancellor of the Exchequer, amid growing concern within the logistics industry that Britain's borders will not be ready in time for January 1, The Financial Times reported.

Gove was also warned by government officials that there are "critical gaps" in plans to prepare borders and businesses for the end of the transition period, according to Bloomberg, particularly crucial IT systems that will handle the movement of lorries to and from the EU.

Business Insider reported that Britain's food industry has warned Johnson's government that the deadline for producing new labels needed to legally sell food to the EU and Northern Ireland from next year has already passed.

On Friday, a spokesperson for Prime Minister Johnson sought to calm fears that the UK would not be ready to break away from its biggest trading partner.

"We have been clear since we left the EU that after the end of the Brexit transition period there will be changes and things companies need to implement," they said. That's why we have been working with them throughout the transition period and will continue to do so."

However, Reeves accused Gove and the rest of the Conservative government of failing to prepare the country.

"Michael Gove is a little bit like an ostrich with his head in the sand. He doesn't seem to be willing to accept the reality of what's around him," she told Business Insider.

"It's faith-based policy based on the belief that Brexit will be a world of sunny uplands.

"The lack of preparedness and 'everything will be alright' approach is ostrich-like. If he removed his head from the sand he'd hear what businesses, which have already got a lot on their plate at the moment, are saying."

She accused the ministers of a lack of transparency around work to prepare Britain for life outside of the UK, amid frustration among British business groups with the lack of government guidance with just four months to go until the end of the transition.

"It is a bit of a running theme with this government that it thinks consultation and dialogue is a barrier to delivery, when actually it is essential," Reeves said.

"Let's take the lorry parks: the government is rushing through these plans using a statutory instrument without any consultation with local authorities to build potentially 29 of them.

"When I went to the one being built in Ashford in Kent, people were coming down and saying 'until the diggers were here, we had no idea what was happening.' It was totally out of the blue for them."

She warned that the government's furlough scheme for workers affected by COVID-19 is due to expire in the autumn and unemployment set to rise. "Large parts of the economy are already on their knees and the last thing they need is another shock to the system" caused by a chaotic exit from the EU.

UK and EU negotiators will hold the next round of formal talks over a free trade deal in London next week amid reports that figures in Downing Street believe the chances of a deal before the autumn deadline are now less than 50%.

However, while a deal would potentially remove tariffs and other friction, with Britain leaving the EU's single market and customs union, there will be new checks and trade barriers, whatever the outcome of negotiations.

Reeves puts pressure on Johnson to drop Tony Abbott

With an eye on new free trade agreements with non-EU countries, Johnson's government has appointed former Australian prime minister Tony Abbott as an advisor on UK trade policy.

However, the prospect of Abbott's appointment has prompted outrage across the political spectrum, with opposition MPs and even some in Johnson's Conservative party arguing that Abbott's history of allegedly sexist and homophobic remarks make him unsuitable for the job. He has also previously described climate science as "absolute crap."

Trade experts have accused Abbott of lacking the qualifications to advise on trade, pointing to his claim that a no-deal exit from the EU would be "no problem" for Britain.

Reeves, like Labour Party leader Keir Starmer and Emily Thornberry, the shadow trade secretary, said she was strongly opposed to his appointment.

"When he was prime minister of Australia he oversaw the decimation of the car industry in his own country. I'm not sure that his track record of promoting business is that good," she told Business Insider.

"To represent our country and it's great diversity, with someone who holds racist, misogynistic, and homophobic views, is not the message or the image of Britain that we want to portray around the world.

"Many of our businesses are led by people from a whole range of backgrounds and I think they'll be disappointed and shocked to know that Tony Abbott will be representing us around the world.

"Next year we will be hosting the climate conference in Glasgow and the guy's a climate denier. If Britain wants to show global leadership in tackling the climate emergency, I don't see how Tony Abbott is qualified to do that job."

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