UK Customs Service Postpones Blockchain-Driven Border Project Until After Brexit

Her Majesty’s Revenue and Customs (HMRC) has delayed further work on a successful blockchain project in the wake of Brexit, according to a written parliamentary statement published Feb. 7.

The question about the distributed ledger project for customs needs was raised in the Q&A section on the United Kingdom Parliament’s website. On Jan. 30, Member of Parliament (MP) Eddie Hughes asked whether the government plans to use blockchain for customs systems after the U.K. leaves Europe. He also requested an update on a previously announced trial of the technology.

In response, the financial secretary to the U.K. Treasury, MP Mel Stride, explained that the project involved the development of a permissioned blockchain “that could be used to inform a trader’s ‘Authorised Economic Operator’ status.” Stride also reported that the pilot was trialed for six weeks and “established that government could use Blockchain to securely share the results of sensitive risk checks to improve the efficiencies of certain customs processes.”

However, the MP reported, further development of the solution would require significant work from HMRC and thus has been postponed “until after the U.K. leaves the EU when timescales and cost will be revisited.”

The financial secretary also revealed that the work might continue under the aegis of the Brexit-focused Future Borders Programme, as a part of their trading initiative.

The application of blockchain for customs needs was first announced by HMRC in September 2017 in what appears to be a separate initiative. Back then, the watchdog decided to examine using blockchain to make the border technologically ready for when the U.K. leaves the EU. After Brexit, the country’s customs will reportedly have to handle five times as many declarations than it currently does.

In June 2016, U.K. citizens voted to leave EU, with the country now scheduled to leave the Union on March 29, 2019. However, parties within U.K. have not yet come to a conclusion on how in particular the country is going to deal with various issues, such as trading, citizens’ rights of residence and the border with Ireland.

As Cointelegraph previously reported, United States Customs and Border Protection also launched its own blockchain test to trial the use of decentralized technology in its shipment tracking system.


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Author: Ana Berman
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U.K. Balances Day-to-Day Budget for First Time Since 2002

  • Britain now borrowing only to finance capital investment
  • Total budget deficit in 2017-18 undershoots OBR forecast

Britain was in surplus on its day-to-day budget for the first full fiscal year since the early 2000s, a milestone that is almost certain to revive calls for an end to austerity.

Revenue exceeded spending by 112 million pounds ($156 million) in the 12 months through March, meaning Britain is now borrowing only to finance capital investment, figures from the Office for National Statistics showed Tuesday.

Including investment, the deficit narrowed to 42.6 billion pounds, the least in 11 years and below the 45.2 billion pounds predicted by budgetary officials last month. In March alone, the shortfall unexpectedly narrowed to 1.3 billion pounds, the lowest for the month since 2004.

 Almost a decade of austerity has seen the deficit fall from 9.9 percent of GDP in the aftermath of the financial crisis to 2.1 percent last year, but the cuts have left voters weary and taken a heavy toll on Prime Minister Theresa May’s Conservative government.
The squeeze has led to the loss of hundreds of thousands of local-authority jobs and left hospital emergency services struggling to cope with a spike in winter illnesses. In a sign that the government is yielding to public pressure, it announced last month it was lifting the cap on pay increases for nurses and other workers in the National Health Service.

The elimination of the current-budget deficit came a year earlier than the Office for Budget Responsibility predicted but two years later than George Osborne envisaged when he became chancellor in 2010 — before the European sovereign-debt crisis hit economies across the region.


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Debt Burden Falling

The surplus last year was the first since 2001-02, when Tony Blair was prime minister and the economy was growing healthily. Net debt fell for a third year to 76.3 percent of GDP, the lowest since 2011-12. Chancellor of the Exchequer Philip Hammond hailed the figures as further evidence of an economy “at a turning point.”

Revenue proved much stronger than forecast, growing 3.3 percent. Self-assessed tax receipts, which were expected to be hit by distortions to dividend payments, fell just 0.6 percent amid record levels of employment that boosted income tax.

On the spending side, tight control over departmental budgets was partly offset by higher debt costs — the result of faster inflation — and bigger transfers to European Union institutions. The increase was due to the EU demanding greater front loading of contributions for 2018 than they did in 2017.

Cautious Approach

The cash measure used to calculate how much the Treasury needs to borrow in the financial markets came in at 40.7 billion pounds in 2017-18, instead of the 40.3 billion pounds predicted by the OBR. The Debt Management Office announced after the data that it is increasing its gilt-issuance plans for the current fiscal year by 3.1 billion pounds.

In March, debt costs were 1 billion pounds lower than a year earlier at just 300 million pounds, as the recent slowdown in inflation cut the cost of servicing index-linked bonds.

Despite the improvement in the public finances, Hammond may be reluctant to loosen the purse string too much with Brexit uncertainty hanging over the economic outlook.

The OBR predicts Britain will still be borrowing 21 billion pounds by 2023, casting doubt over whether Hammond can balance the books by the middle of the next decade as promised.

 


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Author: Jess Shankleman 
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