HM Revenue & Customs (HMRC) was due to complete a five-year programme for a new Customs Declaration Service (CDS) by early 2017. However, delays mean that CDS will not be fully operational until January 2019.
In July the National Audit Office (NAO) published a report into CDS that found there are still significant amounts of work required to meet this new target. If there are further delays, CDS may not be running fully by the time the UK is due to leave the European Union in March 2019.
Although HMRC due diligence has found that the CDS system will remain suitable following the UK’s withdrawal from the EU, there is considerable uncertainty as to what customs environment the UK will operate in.
On 9 October the Government published a White Paper describing future customs legislation for post-Brexit. It set out potential scenarios for a new customs relationship with the EU—but it is not yet clear whether HMRC’s existing CDS programme would work for all of them without modification. It is also not clear whether the proposed finish date of January 2019 would give time to make those modifications.
The Public Accounts Committee will ask officials from HMRC about CDS’ progress to date, outstanding risks to completion, and resilience in a number of potential scenarios for leaving the European Union.
