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History repeating

17 October 2018

As the clock ticks down to March 29 next year – the day when, regardless of whether we get a Brexit that’s ‘hard’, ‘soft’ or somewhere in-between, Britain will leave the EU – the purpose of UKWA has seldom been more significant says the Association’s CEO, Peter Ward.

In 2019 UKWA will celebrate the 75th anniversary of its launch. Originally known as the National Association of Inland Warehouse Keepers, it was established in 1944 when the wartime Government asked representatives from warehousing companies to form a committee to plan how food could best be stored and distributed from facilities situated away the nation’s major ports.

Fast forward three quarters of a century and, as Brexit draws ever closer, the Association is once again sitting down with politicians to advise on the role that inland storage sites can play in sustaining vital food supply chains and relieving some of the pressure on our ports.

The Government has, a little late in the day some might say, seemingly woken up to the fact that in post-Brexit Britain, there will have to be some readjustment in the way foodstuffs entering the country at Ro-Ro terminals are inspected if rest of world rules are applied and potentially catastrophic bottlenecks in and around our ports are to be avoided.

Those rest of world rules dictate that food inspections must be conducted within the port boundary, but for, example, the 1000 trucks per day arriving through Dover (which bring 44 per cent of the country’s food supplies from the EU) after Brexit this will be impractical.

Why? Well, take Dover, for example. Unlike the deep-sea ports, Dover doesn’t have the necessary Border Inspection facility, nor the space or time to build one.  Given the lack of adequate infrastructure at the port, significant supply chain upheaval seems inevitable unless action is taken.

Food inspections

UKWA believes that part of the solution could be a change of legislation to allow food inspections to be carried out at inland storage facilities. Such sites could be built, or members’ existing facilities adapted, to accommodate inspection regimes and deliver the extra capacity so obviously needed relatively quickly.

Whilst food is of critical importance and, as such, a prime focus of those grappling with our withdrawal from the EU, post-Brexit supply chain stress is predicted to impact many industries.

Regardless of physical inspection, it is likely that for the majority of goods some of form of customs declaration will be required; whatever trade deal is struck the government will, regardless of potential duty and VAT implications, require trade to and from the EU to at the very least be counted, amounting to some 200 million additional customs entries.

In general, all of this is good news for our sector: The proven safeguard against supply chain interruption is to hold more inventory - which means UKWA members are likely to see an upsurge in demand for their services.

However, any excitement over the prospects of a 3PL ‘gold rush’ should be dampened by the fact that a cumbersome planning policy restricts the construction of new storage facilities in the places where they are most needed.

Therefore UKWA members should prepare to seize opportunities for any spare or under-utilised capacity in existing networks to be fully optimised.  The timely introduction of UKWA MarketSpace, our on-line portal to connect demand for warehouse space with available supply, has been warmly welcomed by government as a tool to assist in solving one of Brexit’s key challenges.

So, as in 1944, through its members UKWA is working closely with various government departments to help the policy makers understand the perspective of our industry and contribute to solutions and the formulation of coherent and effective policies.

UKWA is also lobbying the Government to address concerns that that the continuing uncertainty over Britain’s post-Brexit immigration policy will lead to a shortage of labour that will have serious ramifications across the logistics industry.

At a time when the UK is experiencing the lowest youth employment rate since the 1970s and the Government remains committed to a post-Brexit cap on net migration, labour has become a scarce resource in the logistics industry, particularly at peak times

Concern is growing that any deepening of the workforce shortage crisis could, for example, mean that retailers will no longer be able to offer their customers same-day or next-day delivery – particularly in the run-up to peak periods such as Black Friday, Cyber Monday and Christmas.

The simple truth is that supply chains rely on orders being picked, packed and despatched and without the people to do these tasks, it seems inevitable that some adjustment in stated delivery times will be inevitable for many companies – not just in the online retail space but across all industry sectors.

Migrant workers

To relieve some of the pressure felt by supply chains during peak periods, UKWA is urging the Government to allow employers to continue to access temporary and seasonal workers from the EU and it was disappointing that the Government’s recent Brexit White Paper was somewhat vague on the UK’s post-Brexit immigration policy. 

Whilst emphasising repeatedly that the free movement of people will come to an end, the White Paper announced that the detail of a new immigration policy will be published in a separate paper later this year.

The Association has worked closely with the Recruitment & Employment Confederation (REC) on its recently published report, Short-term labour for long-term growth: EU agency workers post-Brexit, which has highlighted the labour pool shortfall problem. 

The REC’s study found that 60 per cent of recruiters operating in the warehousing sector recruit at least half the temporary staff they supply from the EU with almost three in ten (28 per cent) saying Europeans make up three quarters or more of their agency workers.

UKWA will continue to lobby the Government to ensure that the UK gets an immigration policy capable of delivering a stable and sustainable workforce to fill the logistics industry roles that are so essential and does not affect seasonal workers so that logistics companies are able to cope with the demands that peak periods place upon them.

The REC’s EU agency workers post-Brexit report highlights that Britain’s dwindling workforce is having an impact across all industry sectors and companies in the logistics industry are competing with employers in healthcare, construction, hospitality and a host of other sectors for workers. Therefore UKWA has a vital role to play in helping to promote logistics as a bouyant and fast-moving industry that offers excellent employment prospects.

In the current climate it is also increasingly important that logistics companies retain and get the most out of their their existing employees at all levels. UKWA offers its members a range of training and education programmes that not only deliver a more skilled and efficient workforce, but, also – our research has shown – build loyalty among the members of staff that participate in them.

Such is UKWA’s political engagement over Brexit, and many other issues,  that as the clock ticks down to March 29 next year – the day when, regardless of whether we get a Brexit that’s ‘hard’, ‘soft’ or somewhere in-between, Britain will leave the EU – only one thing seems certain: the purpose of UKWA and value of membership has seldom been more significant than the present time.