Official Report: Minutes of Evidence
Concurrent Committee of the Committee for the Economy, Committee for Infrastructure and Committee for Agriculture, Environment and Rural Affairs, meeting on Wednesday, 24 March 2021
Members present for all or part of the proceedings:Dr Caoimhe Archibald (Chairperson)
Miss Michelle McIlveen (Deputy Chairperson)
Ms Clare Bailey
Mrs Rosemary Barton
Mr Roy Beggs
Mr John Blair
Mr Cathal Boylan
Mr Maurice Bradley
Mr Keith Buchanan
Mr Stewart Dickson
Mr Gordon Dunne
Mr Paul Givan
Mr Harry Harvey
Mr William Irwin
Mrs Dolores Kelly
Ms Liz Kimmins
Mr Patsy McGlone
Mr Philip McGuigan
Ms Sinéad McLaughlin
Mr Gary Middleton
Mr Andrew Muir
Mr John O'Dowd
Mr Christopher Stalford
Mr John Stewart
Ms Claire Sugden
Witnesses:Mr Aidan Reilly, Her Majesty's Revenue and Customs
Mr Christian Benson, Trader Support Service
Ms Julie Etheridge, Trader Support Service
Mrs Mary Scullion, Trader Support Service
Impact of the Northern Ireland Protocol: Trader Support Service; Her Majesty's Revenue and Customs
The Chairperson (Dr Archibald): I welcome Christian Benson from Fujitsu, Trader Support Service (TSS); Mary Scullion from Fujitsu, TSS; Aidan Reilly from HMRC; and Julie Etheridge from HMRC. I will hand over to you to make an opening statement, and then we can get into the discussion. Thank you very much for joining us.
Mr Christian Benson (Trader Support Service): Thank you very much. Good morning, everybody. If it is OK, I will share my screen in order to provide a quick briefing on TSS. I will try to keep this brief because I am aware that members would like to ask questions. Hopefully, everybody can see my screen.
The Committee Clerk: Christian, we are not seeing slides.
Mr Benson: Right. OK. Let me try again.
Can you see that?
The Committee Clerk: We are good now.
Mr Benson: Thank you very much. I am Christian Benson, client managing director for HMRC in Fujitsu and the senior responsible owner (SRO) for the Trader Support Service. I am joined by Mary Scullion from Fujitsu, who is head of delivery for the Trader Support Service; Julie Etheridge, who is the delivery director in Northern Ireland for HMRC and the SRO for the Trader Support Service; and Aidan Reilly,
By way of background, TSS was set up at pace, built and rolled out in three months, and all of that happened under COVID restrictions. The procurement process began in August, and the contract was awarded to the TSS consortium in mid-September. The consortium includes Fujitsu, which has prime responsibility; McKinsey; EORI UK; the Institute of Export and International Trade; and Hinduja Global Systems (HGS). The programme was launched on 28 September, shortly after the contract was awarded, with the go-live of the Northern Ireland Customs and Trade Academy (NICTA) website to provide education. Over 1,000 people are working on the programme to deliver TSS.
Preparedness and education have been a large part of the service that we have provided and continue to provide. We have hosted over 150 engagements so far with businesses and trade
one-to-one basis and, in addition, over 75 seminars, reaching approximately 3,500 organisations and individuals. You can see in front of you a selection of the organisations that we have engaged with. Just out of interest, we have engaged with the Automated Customs and International Trade Association (ACITA), Belfast City Council, the British Retail Consortium NI and UK and the International Meat Trade Association.
We have over 30 user guides on our education website, the NI Customs and Trade Academy. Those guides have been downloaded over 330,000 times since going live at the end of September. The service is a free-to-use digital service to help businesses and traders of all sizes to navigate the changes to the way in which goods move since the Northern Ireland protocol came into effect on 1 January. We offer education and advice. We provide a digital-first service, which means that it is mainly website-driven, but we also provide a contact centre and contact-centre support to help traders with issue resolution on the new mandatory process. We do not provide the personalised intermediary service typically offered by customs brokerages. We do not offer commercial advice, although we offer tailored and specific advice on how to use the process. We do not replace the services offered by the existing intermediary market, nor do we raise non-standard documentation; for example, health certificates and other licences. We are very focused on the HMRC customs process, though we do offer advice across the full range of customs processes that need to be followed by traders.
The process is illustrated on this slide. We have made every effort to simplify the process as far as possible. It consists of one-off registration. Traders register with the service on the platform. So far, over 36,000 traders have done that. They submit the shipment information to TSS. We provide the carrier with an entry summary declaration and automatically process a simplified frontier declaration on behalf of the trader. We interface with HMRC systems, which provide the approval to move goods. The shipment arrives, and the trader provides additional shipment information to compete the supplementary declaration. The trader also needs to maintain evidence and pay duties as required by HMRC.
As I say, we now have over 36,000 registered traders. Original estimates were 24,000, so that is far more than we had originally anticipated. Of those traders, 43% are based in Northern Ireland, 2% in Ireland and 55% in Great Britain. Since 1 January, we have seen a rise of over 30% in registrations, providing evidence that the market thinks that TSS is working and responding.
On staffing and operations, we have over 1,000 people working on both the programme and the live service. In the contact centre, we have 750 agents manning the desks between 7.30 am and 10.30 pm, seven days a week. We operate a triage system, so we have three tiers of agents. Tier 1 agents deal with incoming calls and simple requests, such as password resets. Tier 2 agents make up the majority of agents in the call centre. Typically, they have over two years' customs experience and deal with the more detailed cases. Tier 3 agents typically have seven or more years' customs experience. They deal with the more complex cases and take a hands-on and
approach with traders to help them to sort their problems. We are constantly upskilling our agent base with weekly training and knowledge sharing between the three tiers of agents.
We can see some numbers on the left-hand side. We offer free support and advice to traders in managing legally required customs declarations. TSS has so far processed and enabled the movement of over 330,000 consignments since 1 January. It is a digital-first service, so 90% of queries are raised online. TSS users actively engage with the training and training materials. There have been nearly 200,000 visits to NICTA, and 300,000 training guides downloaded.
TSS is an evolving service. We started with a process that would facilitate the movement of the maximum number of goods for more traders. We started with the most simplified and commonly used process, but that service is evolving. We have worked hard to train our agents more extensively. As I said, weekly training sessions occur with all contact centre agents. We are constantly educating the trader community. I spoke about the one-to-one engagements and the seminars that we hold. Those seminars, typically, are hosted by TSS representatives and HMRC, plus DEFRA and DAERA representation.
We are not complacent. We recognise that there is still work to do. We continue to work on releasing more functionality and
to enhance our service to support the trading communities of Great Britain and Northern Ireland.
to identify and apply union customs code (UCC) facilitations to help to reduce administrative requirements, particularly for small traders.
The slide shows examples of how we have responded to the market. TSS was instrumental in securing an easement for traders moving sanitary and phytosanitary (SPS) groupage loads, in particular catches of fish that were unable to move from Scotland to Northern Ireland. We worked alongside HMRC and other government agencies to simplify that process. That was done over New Year's Eve and New Year's Day, when we engaged with Shanker Singham, our senior trader adviser, to enable that to happen. We have responded to hauliers, who told us that the service was not properly serving their needs. We quickly created a system to more closely model the business model of hauliers, known as "Consignment First". That model allows consignment data to be entered separately and in advance to the vehicle details. The TSS transit service has been well received by the market, and the slide shows a quotation from Hans Maessen, former head of the Dutch Association of Customs Brokers.
The final slide shows a quote from Roger Pollen, of the Federation of Small Businesses, about TSS being extraordinarily helpful and really helping individual businesses to facilitate goods movement as well as we can, and we are [Inaudible.]
That is the end of my briefing. I am incredibly proud of the service that the TSS consortium has managed to stand up in a very short time. We continue to evolve, as I said, to help businesses and help to facilitate the movement of goods between GB and Northern Ireland.
The Chairperson (Dr Archibald): Thank you very much for that, Christian. Just to make it clear to members, questions will rotate around the Committees as follows: Economy, Infrastructure and AERA, and around again and again. Questions will continue until there are no more to be asked or until the briefing ends at 12 noon. As always, questions will be asked through the Chair. The Deputy Chairs and I will identify the members to ask questions. The member will be brought into the spotlight, if they are using StarLeaf, where they can ask their question. Once they have asked their question, they will be returned to the audience. Each Committee has determined the order in which members will be called. To ensure that the maximum number of members gets to ask a question, members should not make long preambles or statements before their question. There will not be an opportunity to ask an immediate supplementary following your initial question.
I will open the questioning. Thanks very much, Christian, for the briefing. It was very helpful. As you highlighted, it is an evolving service. Obviously, the lateness of the agreement on how the protocol would operate and the Trade and Cooperation Agreement (TCA) itself impacted on how the TSS operated initially. At the beginning of the year, there were widespread reports in the media and from constituents that the TSS was not functioning particularly well and that inconsistent and incorrect information was being given initially. Will you provide some feedback on that? Is that a correct reflection? What has been learned since the beginning of January? What is being done to be more responsive to the needs of businesses? You said specifically that you did not provide bespoke information, but s further work being done to enable you to be more responsive to individual businesses?
Mr Benson: When the service was stood up, we were conscious of the need to serve businesses that had not had to do this before. We have been training our contact centre agents since they were recruited at through the back end of last year. We continue to improve that training and provide training to all agents on a weekly basis, as I said. We see a gradual improvement in the way in which calls are being answered and businesses are being served. I am confident that, with that training in place, the experience that we have gained, the triage system that we have in place and the different tiers of agents, we have a gradually improving service and more and more experienced users providing a better service to traders.
You asked about a personalised service. We do not offer a commercial service, as typical customs agents or intermediaries would, but we call traders who, we see, are having problems. Through our tier 3 agents, we provide sector-specific advice. We have examples of businesses that have provided positive feedback on the service provided. We are also proactively reaching out and calling businesses. On Tuesday, for example, we made over 10,000 outbound calls from the contact centre to registered businesses that, we thought, were stuck or needed assistance, to help them through the process. We are proactively reaching out as well as taking calls into the contact centre.
Mrs Mary Scullion (Trader Support Service): I will build on some of the points that Christian has made. As Christian said, we are constantly improving the training of the various tiers of agents, as we see how it needs to evolve. We have built in a complete feedback loop. We have a stakeholder engagement team that operates with the trade associations, which Christian mentioned, on a one-to-one basis with businesses that need advice about how they get through the process. In those engagements, we collect feedback and identify common problems, and our training is evolving on that basis. We have developed over 750 knowledge articles for our contact centre agents based on those engagements that help them to answer the questions that, we know, exist in the marketplace. We have a complete feedback loop, if you like, in trying to develop that training and to improve. Our market engagement gives the insight into what traders face, and that is what we use to build our training and our knowledge articles for our contact centres.
The Chairperson (Dr Archibald): Thank you very much for that response. We have had feedback that you are very willing to listen to feedback, so that is useful.
Miss McIlveen: Thank you for the presentations and for addressing the Committee. I suppose that we are all conscious of the negative impact of the protocol. My party has been clear in its opposition to it and is working to replace it.
I appreciate that the systems were set up at pace and are evolving and that it is about trying to educate businesses on both sides of the Irish Sea on how they need to address that. I am conscious that there has been a lack of understanding on the mainland about sending packages, particularly small packages, to Northern Ireland. What work is being done to educate businesses on the mainland?
There have also been issues for Northern Ireland hauliers, who, as a consequence of the protocol, have had to transport empty trailers from mainland GB at great expense to themselves. Are you looking at a support package for those hauliers?
Mrs Scullion: We are aware of that, and we do speak to the Road Haulage Association and other trade bodies about the difficulties that they face. Our response on the "Consignment First" solution, which Christian referred to in his presentation, was in answer to the kind of issues that the hauliers were bringing to our attention. It was very much based on the fact that they are putting together details of their consignment way before they know exactly which lorry or which vehicle is to take a consignment from GB to NI. "Consignment First" allowed them to put together those details and at the last minute, as their business model is, to allocate them to a particular vehicle. That was exceptionally well received.
That is an example of how we have used feedback to evolve and develop the system. We have a rolling programme of releases for the system. We listen to feedback in conjunction with HMRC colleagues and others, and we identify where we might make improvements. Our rolling programme is identifying the most effective changes that we can make, and we agree a release programme for those and communicate them accordingly.
You asked about preparedness, whether in NI or GB. Interestingly, our analysis of the 36,000 traders registered with us shows that 55% are based in GB, and it is through our outreach with those traders and with the various associations that we are trying to do more and more outreach to make more and more businesses aware and prepared for what is ahead of them.
The Chairperson (Dr Archibald): Thank you.
Witnesses, when you are not speaking, can you please mute your devices? Members using StarLeaf are getting a bit of feedback. Members, if you have not muted, can you please do so as well?
Mr McGuigan: Thank you very much for your presentation; it has been very useful. You talked about the groupage solution, "Consignment First". Was that done in tandem with DAERA? It was mentioned at our Committee that that Department was working on similar schemes. More generally speaking, to evolve and enhance the service that you have talked about, what interaction do you have with DAERA and DEFRA in coordinating checks and documentation relating to agri-food and SPS? How are you working around the uncertainty of the British Government's unilateral extension period moves?
Mrs Scullion: We have regular weekly engagements with HMRC colleagues, with DAERA and, indeed, DAERA/DEFRA join our daily calls just after we do releases. So, we are working very closely facilitated through HMRC colleagues with the Departments that we need to.
We are very conscious that TSS is a small cog in a very big machine, but, having said that, because these things are so interlinked, we have to make sure that we are linked up completely, so we have those regular engagements. I think that we have all the right contacts in the various organisations to resolve issues that are brought to us and to proactively engage in any new releases that we do.
Christian gave the example of the groupage for fish early on in the process. We are trying, as far as possible, to identify where easements help and work those through where we can to make suggestions to improve the lot of the companies and organisations that we engage with.
We are very much about implementing the rules and trying to smooth the path of what the rules tell us we need to apply, but, at the same time, we have, as we have proven through some of the examples that we have given, we have made suggestions and worked with other organisations to identify where simplifications can help.
Mr Benson: It is worth pointing out that the Member also raised how we deal with uncertainty, given the status of negotiations and ongoing changes. We work very closely with HMRC colleagues, including Julie and Aidan, to understand, as early as possible, what might be coming down the track and then make relevant modifications to our systems and processes to allow for those changes to happen. I am really proud of our track record so far in being able to modify those systems and processes to allow for those changes.
Mr Dickson: I thank everybody for the presentations. As we approach the end of or change to the grace periods and as the pandemic starts to ease a little across the UK, we will see a great deal more business and transportation taking place. How are you resourced to tackle that? Clearly, there will be a large change as a result of the ending or changing of grace periods and as a result of an increased volume of traffic and goods in the systems.
Mrs Scullion: As Christian said, we have about 1,000 people working on this. We have 750 agents, and, based on the analysis that we are doing to date, our calls are answered within six seconds on average. As Christian said, we have processed and supported 330,000-odd consignments moving. We have seen all sorts of humps every time we do a new release or every time a new process has to be followed. For example, in recent times, we have made live the supplementary declaration process. So, we see peaks and troughs, but, even at that, we are still well able to respond actively and quickly to the requests that we have, to the extent that we have been able to do 38,000-odd outbound calls in addition to processing 30,000 inbound calls.
It is important to make the point that it is digital-first service, so a huge proportion of the movements that happen through the TSS system are generated by traders electronically and move through the system without intervention, so it is not a hands-on process for everything that goes through the system. Our hands-on activity is around identifying where some traders seem to be having problems. We contact them and do the outbound calling. In addition, we respond to the queries that come in to us digitally or by telephone. Because we are providing a digital-first service, and we are processing declarations and so on 24/7, and because of the evidence we have seen of our response so far, we believe that we have the resources in place to deal with any upload in the volumes. Obviously, we sized to millions of declarations, and we are not seeing those yet, but we believe that we are well placed to cover them all, when we see those peaks in figures.
Mr K Buchanan: Thank you, Mary and Christian, for your information so far. My question relates to your 36,000 registered businesses: 43%, as you referred to, in Northern Ireland, 2% in the Republic of Ireland (ROI) and 55% in GB. What do you envisage that number needing to be? As Mr Dickson said, when the lockdown opens up, trade back and forth will increase. What do you envisage that 36,000 registered number needing to be, so that everybody who always did an east-west or west-east transfer is on the service and using it?
Mr Benson: As I mentioned, we originally envisaged, on the basis of projections from HMRC, that we would have around 24,000 businesses registering with TSS; in fact, as we said, we have 36,000, and a significant number of those have registered since the beginning of the year. It is difficult to say with any confidence how many more are likely to need to register. I hope that we have the vast majority of businesses who need to register already registered on the system. That level of registration has been achieved with the significant amounts of education, outreach and publicity that have been done by TSS, HMRC and the Government. You will have seen TV campaigns and social media outreach. We use LinkedIn and Facebook to reach as many traders as possible. Towards the end of last year, we did a focused campaign to reach out proactively to all the traders that, we knew, were conducting business between GB and Northern Ireland. There was a significant uptick in the number of registrations based on that [Inaudible.]
As I said, it is really difficult to say, but I have confidence that we have reached the majority of traders who move goods.
Mr Irwin: I thank Mary and Christian for their presentation. At the outset, let me make it clear that, as a party, we will not support the protocol at all and want to see it replaced.
There are difficulties with the current grace period. I have businesses complaining about supplementary declarations. The grace period will end at some stage, and we have been told by the Chief Veterinary Officer (CVO) in Northern Ireland that the number of declarations will increase tenfold at that point. There may be as many as 30,000 per day. I think that Northern Ireland will be unable to manage that. How do you see the protocol being delivered when the grace period ends and that massive tenfold increase in declarations comes into force?
Mrs Scullion: Our projections of the numbers allow us to process the declarations that we anticipate. It is worth saying that, as you say, supplementary declarations are difficult. Our biggest focus collectively, for TSS and our HMRC colleagues, has been on keeping goods moving. That is why we separated the movement of goods from the slightly more complex process of supplementary declarations once they have arrived. We will continue, jointly, to have that focus on keeping goods moving.
We did not mention that, although our call centre operates from 7.30 am to 10.30 pm, we can process declarations electronically 24 hours a day. We also offer a stuck-at-port service out of business hours that ensures that those goods keep moving. There was a rationale in separating the goods moving from the declarations that are slightly more complex, where rules and so on have to be applied in supplementary declarations. Our projections are that we will be able to deal with the volume of movements and declarations that are required as time evolves and grace periods and so on finish.
Mr Aidan Reilly (Her Majesty's Revenue and Customs): I think that the member referenced the check grace periods. They do not have a direct impact on the number of declarations that traders need to make for customs purposes, although extra data fields might be needed on those declarations, depending on what the final situation is with regard to those checks. The declaration numbers in respect of customs should continue as is, wherever we end up getting to with regard to the final position on agri checks.
Mr Middleton: Thanks for the presentation. It was useful information. I want to put it on the record that, obviously, we do not support the protocol; we want to see it replaced.
There has been a lot of confusion in GB around customs declarations and courier requirements. Various GB businesses have taken the decision not to deliver goods to Northern Ireland. Do you have any figures for those that have contacted TSS and have felt that the burdens and complexities are too much and so have decided not to bother servicing the Northern Ireland public?
Mrs Scullion: We do not have specific stats on those that have taken those decisions. Our job is very much to support people through the process. We have provided some examples of the feedback that we have received where we have been able to ease that process. My husband is a small trader. Obviously, like every other small trader in Northern Ireland, he has been worried about how he might import his goods and how his suppliers might react. So far, he has used the Trader Support Service effectively to work with his suppliers in GB to bring goods into Northern Ireland for his business. I am not sure how he would have done that without the help of the likes of the Trader Support Service.
We very much feel that our job is about making it easier for businesses to move goods from GB to Northern Ireland from the perspective of both the trader in GB supplying the goods and the businesses such as my husband's in Northern Ireland that are trying to bring the goods in. As we said, in terms of the number of movements that we have made, we have eased the path for many people. We have tried to make it as simple as possible.
As we have described, that has evolved over time. We will continue to do that. We do not provide a bespoke solution for every organisation, but we provide bespoke advice. We will help individual traders through the journey if they are in touch with us. We do not have statistics on people who have made the decision not to supply goods to Northern Ireland. We do not have specific visibility of that information.
Mr Boylan: Thanks for your presentation. Christian, one of your slides indicated that this is a six-stage process from the point of registration. Can you quickly outline the time frame for that process? There is also the issue of the potential increase in numbers from the current position, of 36,000. Is the TSS ready for any increases?
I represent a border constituency. What engagement has there been with businesses in the border corridors that are registered in both the North and the South? Brexit has meant those businesses need to have an operating centre in the South. Has there been any extra engagement and advice to facilitate the transition for businesses that primarily operate from the North?
Mr Benson: I am sorry; you broke up at the beginning. I am not sure I caught all of your question. Were you talking about the time it takes?
Mr Boylan: Yes, I want to know about the time frame for the six-stage process from registration.
Mr Reilly: On average, we can process about 80% of declarations within 15 minutes. Of those, the vast majority flow through in seconds to the HRMC systems, and we get a response from those systems. The end-to-end process includes supplementary declarations. The supplementary declarations are raised after the goods have moved, and that dictates the length of the end-to-end process. The vast majority of declarations are handled in seconds.
I will go back to Mary's points on the increase in volume and numbers. We are very confident that the contact centre is resourced to deal with the anticipated increase in volumes. Also, we are confident that the technology solution that we have provided is sized appropriately to deal with large volumes of declarations. We are very confident that that will continue to be the case when the volume is in excess of what we are doing now. So far, the system has been available 100% of the time. Since 1 January, the system has not gone down at all. There have been no outages, and we are confident that will continue to be the case.
On your point about engagement with businesses North and South of the border, our focus has been on engaging with Northern Irish and GB businesses moving goods east-west and vice versa. However, we are closely engaged with the Irish Government and their Departments and agencies. We hold regular calls with the Irish tax and customs service and the Irish Department of Agriculture, Food and the Marine (DAFM). We are closely linked to what it is doing with its systems to make sure that North/South trade is facilitated as far as possible.
Mr McGlone: I thank everyone who has attended and facilitated the meeting. My question is probably for Aidan and HMRC, and it is about the supplementary declarations. Many businesses have already made supplementary declarations, and that process is flagging up high notional tariffs. We are all into new territory, and I want to get a handle on how HMRC works with businesses to ensure the proper application of the appropriate waivers and to minimise — maybe zero-ise — any tax or liabilities that may ensue as a result.
Mr Reilly: Thank you very much. You make a good point. There are a number of routes to avoid tariffs on goods in GB-NI movement. As you mentioned, there is a waiver scheme for de minimis amounts under €200,000 over three years
[Inaudible due to poor sound quality.]
There is the UK waiver scheme, where traders can declare goods as not at risk or if they meet the rules of origin requirements under the UK trade agreement. We are working with the TSS to make sure that the traders understand those choices and are directed, as far as possible, to the best choice for their circumstances. TSS is looking to make improvements to the portal to make sure that traders do not inadvertently miss the opportunity to make the right claim when they complete their supplementary declarations through the process. We are looking to make sure that we target those traders towards the best choice available to them and, through the TSS process, make sure that they make those choices to ensure that they do not pay tariffs where they should not do so.
Mary or Christian may want to come in on that.
Mrs Scullion: I think that the pack includes examples of where we have talked organisations through that process. Alliance Flooring Distribution at one point in the process — I cannot remember whether it was early on or more recently — wanted to make sure that it was able to avail itself of any zero tariffs that were available under the trade agreement. We were able to work through that to make sure that it was able to use preferential duty codes and ensure that it did not incur tariffs. That is just one example where we coached an organisation through the process to ensure that it availed itself of what was available, whether that was a waiver, preferential duty code or whatever. We have encouraged people to use the UK trader scheme where they can declare their goods as not at risk to further ease the process. We are trying to work as closely as we can with organisations to do that. That is what I mean when I talk about bespoke advice as opposed to bespoke solutions; we work with organisations to help them work out what is best for them.
Mr Benson: It is also worth pointing out that, as I said, it is an evolving service. We continue to evolve on the technology side as well to ensure that the portal is as easy to use as possible and that we build advice into it so that, when traders enter different types of information, they are guided on the type of information that is needed. We are looking at ways to simplify the supplementary declaration process further so that traders are asked to enter only the data needed on the basis of the type of goods. Those are examples of the evolution from the technology perspective that we continue to implement.
Ms Sugden: Good morning, everyone. Is there a mechanism to capture or support new businesses that may not yet have traded east-west or west-east but are exploring their options and want to access your service to see what it looks like and see if there is an opportunity there?
Mrs Scullion: Without a doubt, we encourage anyone who has queries to register with us as a service. Registering with us does not necessarily mean that you will do all your declarations through us. However, by registering, you will have access to all of the materials.
The Northern Ireland Customs and Trade Academy produced a lot of our materials and has extensive experience in the area, and the 330,000 downloads that Christian referred to in his presentation are people doing just that: looking to see what they need to do and how they could go about things and so on. Registering for the service is not necessarily a declaration that says, "I will use the service"; it allows that educational activity to take place and exploration of what the process is about, what people need to know and what they need to prepare for. We encourage people to register for the service so that they have access to all that material. Clearly, they can raise queries with us, and we can answer some of the questions that are perhaps unanswered.
In doing a lot of the work and analysis with our agents, we had a wealth of comments from them that said, "When so-and-so contacted me, they had read a lot of the training materials and were able to use them, but they had a remaining query that we have now helped them with". The evidence suggests that a lot of people find the material easy to use. It navigates them through what is, by its nature, a pretty complex area, but the materials help them to understand and navigate through the process.
[Inaudible due to poor sound quality]
[Inaudible due to poor sound quality.]
From the outset, I highlight that I consider the Northern Ireland protocol to be a huge burden on trade, particularly east-west, and I seek its removal. That said, I pass on my appreciation for the efforts of the Trader Support Service, because I hear positive comments from industry about your efforts to overcome some of those burdens.
Nevertheless, huge burdens remain. Companies are now being asked about the supplementary declarations. That is another level that they are starting to see. In particular, there is concern about groupage, which could have resulted in lorries with 3,000 parcels having to input all that information individually. With airfreight, there are perhaps 8,000 packages in a single cargo, which adds considerable cost, yet I understand that there is no facility to upload via spreadsheets, which would improve efficiency for everybody. Again, there is the customer declaration support. I understand that there is to be a super-reduced data set, but that has not been finalised or published, and there is no time for training.
The last point is about bureaucracy. I pick up from some companies that they tender internally in their groups for work within the UK and that all that additional bureaucracy is adding to their costs, making them uncompetitive and creating uncertainty about their future. My question to everyone is this: what are you doing to reduce the horrendous level of bureaucracy and additional costs that companies face when they move goods, particularly from east to west?
Mrs Scullion: Thank you for that. There are two or three parts to that question. I will address the first one about the uploading. We will release our bulk upload for supplementary declarations shortly, and that should hopefully address the first point about people asking, "Can we not upload?". It is not about spreadsheets per se but about overcoming the problem of having to individually input every supplementary declaration. It is a mechanism through which you can bulk upload them and they are then processed singly, but it eases the burden. We did that bulk upload when we were doing entry summaries and simplified frontier declarations (SFDs) in the early stages when we first went live, and, typically, the bulk upload functionality follows shortly after the portal functionality. The good news is that the bulk upload is imminent. The specification for that was published some time ago. I cannot remember exactly when, but I think that it was mid-to-late February. That specification was published some time ago, as was the how-to guide to using the bulk upload functionality, and they are available on the NICTA website.
We are always driving to simplify as far as we can. In some cases, as Christian said, it is about technology, and in some cases it is about working with colleagues from HMRC and so on to see how we can implement the rules in a slightly different way. I know that the groupage solution in the early stages went some way towards doing that kind of simplification, and we will add those ideas to what we call our "product backload", which is a rolling programme, as we talked about. We are still constantly working with colleagues to identify how we can make things easier. Without a doubt, there is a set of rules that we have to follow, but, as I said, we are really focused on trying to make that as simple as possible and support as many organisations as we can through that process.
Mr Reilly: May I come in on the specific point about parcels? As the member will be aware, the Government have announced that they will extend the easement period for business and consumer parcels for another six months until we can get to a sensible and pragmatic final solution on the approach to parcels. We are acutely aware of the need to come up with a more proportionate approach to that, and we will work with the EU-UK Joint Committee to achieve that.
Mr Benson: The bulk upload is available and is being used for entry summary declarations (ENSs) and simplified frontier declarations. Mary mentioned that the supplementary declaration bulk upload will be very shortly available and is being tested with a number of organisations that, we know, want to use it. We are working with those organisations to make sure that that bulk upload is as simple to use as possible and that they fully understand it.
I talked about the outreach and the one-to-one conversations that we have with businesses. Those businesses include those task parcel operators, so we are fully aware of their requirements, and we are doing all that we can to satisfy them within the terms of the requirements
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Mrs Barton: Good morning, and thank you very much for your presentations. I also see the protocol as a totally unnecessary burden on the transport of goods from Great Britain into Northern Ireland.
I have a few questions for HMRC. It expects to have a system in place to provide refunds of tariffs paid where goods remain in Northern Ireland. Have you any idea when that will start? Is there any chance of perhaps introducing a simplified tariff payment and reclaim system along the lines of the VAT return so that companies do not wait longer for money?
Mr Reilly: I will return to the points that I made to one of your colleagues. First, we are looking to ensure that traders make the best choices that they can in order to avail themselves of the options to avoid tariffs either through the waiver scheme, the UK trader scheme, claiming preference or using one of the customs special procedures, if those apply to them. However, there will be circumstances where goods are moving through Northern Ireland to the Republic of Ireland where tariffs should be paid or where goods are ultimately consumed in Northern Ireland, and we are looking to provide a reimbursement scheme for traders in those circumstances.
We are looking to get that in place as quickly as possible, and, when it is, traders will be able to make retrospective claims that go back to the beginning of the regime to ensure that, from that perspective, they do not lose out. Clearly, we are conscious that there will potentially be some cash flow issues, so we want to make sure that we work as closely as possible with all the relevant groups to ensure that we can ease that as much as possible. If there are any individual cases that you come across, please contact TSS or HMRC, and we will see what we can do to ease the burden as much as possible and work with those people on that.
Ms McLaughlin: Good morning, everyone. Thank you very much for your presentation. First, I acknowledge the work of TSS. The service is obviously in its infancy and is an evolving service, as we heard from those presenting this morning. I think that, collectively, we all want to make sure that we overcome any problems and smooth them out. I am very aware that TSS is an operational body, but it is also an important advisory body because it is at the coalface of where problems exist. What is the relationship between you and the Joint Committee and the joint working group, and how do you feed into them so that they are aware of the actual practicalities and the problems in the system?
We heard Christian indicate that it is an evolving service. Can he advise what easements are under consideration, and what we can look forward to in making the service much more user-friendly from the perspective of the businesses, the hauliers and so on that are affected by the service?
Nobody wanted the protocol at all, and nobody wanted Brexit in its current form, but we are where we are because of Brexit, not the protocol. What additional easements are being explored and how do you think we can overcome it? We have heard about the improvements in digital and the platform itself, but, over and above that, what is there?
Mr Benson: Thank you for your question. Yes, it is an evolving service, as we said. Because we are talking to so many traders, because we are at the coalface, as you said, and because we are taking so many calls and are making outbound calls as well, we are in a unique position of being able to take that feedback from traders on simplifications that, they think, would be useful and on improvements to the service. All that feedback is gathered, grouped and consolidated, and we discuss it very regularly. As I said, the individual calls that we have and the collaboration that goes on in the call centre between the tier 3 agents, our expert advisers and the tier 2 agents enable us to gather that feedback. We then make recommendations back to HMRC.
Mary mentioned the product backlog. Enhancements that can be made to improve and simplify the service are fed into that product backlog and prioritised with HMRC, so the modifications are improvements that will have the maximum impact. Also, we feed back to HMRC on other simplifications or easements that may be useful and worthwhile. Through HMRC, there is a route up to the Joint Committee and other Departments.
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particular easements that are being planned, it is very much an HMRC and government function to look at that sort of thing. All that I can say is that, as soon as we become aware of them in TSS, obviously we work to modify the system and process as quickly as possible to enable that to be reflected in our service. Perhaps, Aidan, you want to talk about the easements.
Mr Reilly: Thank you, Christian. I do not think that there is a lot to add to what you said. We are basically alive to the need to explore, insofar as it is possible, ways in which we can make things as straightforward and simple as possible for business, particular in data requirements, and we are exploring ways in which we can reduce the data requirements and the supplementary declarations as far as possible. We are working closely with TSS on how we can deliver that.
To go back to the point that I made about targeting traders with the right options for tariffs, we are trying to make sure that, as we release the supplementary declarations to traders, we do it in a way that means that we can target them with the right options and so that we can make sure that the call centre staff are ready to work with those traders on the correct options. That is about making sure that we can ease them through the process and ensuring that they do not pay tariffs that are not due.
Mr Muir: Thank you for coming this morning. It is a very unusual and very large Committee meeting.
I will follow on from the question from Rosemary Barton about the at-risk goods and the rebate process, because it is obviously a significant issue. Are there are any timescales for resolving that, given that it has an impact on cash flow for businesses?
The Republic of Ireland obviously has its imports system, so have you learned any lessons from its experience to date? There are no grace periods and stuff like that down South, so are there any learnings to take from what the experience there has been to date?
Mr Reilly: Thank you very much. On the rebate scheme, as I said, we are trying to make sure that traders avoid tariffs in the first place as far as possible. However, where they incur tariffs and those goods are ultimately consumed in Northern Ireland or re-exported and a rebate is claimed, we are looking to get the rebate scheme in place as quickly as possible. Hopefully, it will be in place in the not-too-distant future — in the next few months — in order to ensure that traders can claim rebates back to the beginning of the regime when that occurs.
The key point is that we are trying to make sure that we can target the options for avoiding tariffs for traders. If there is a situation where traders will need to avail themselves of the rebate scheme, they can contact HMRC and TSS, and we will try to work with them as much as possible to ensure that they do not suffer cash flow issues as a result of that.
On learning from what has happened in the South, we speak regularly to our counterparts in Irish Revenue to understand how things are operating there. Christian mentioned the conversation that TSS has had in that space, and quite a lot of that is about ensuring that we can ease the flow of
movements in both directions from Northern Ireland through Ireland into GB and beyond. We are very keen and are acutely aware of the need to ensure that the Irish processes work efficiently and smoothly in order to make sure that Northern Ireland businesses can move their goods in that route in as unfettered a manner as possible.
Mr Blair: I add my thanks to all who are here today for answering questions and looking at solutions. On the basis of solutions to the much-predicted problems of Brexit and its outworkings, I will try to focus on a potential goods-in-transit system. I am talking about goods destined for Northern Ireland that come from GB through either Rosslare or Dublin ports. I am also mindful that those routes are often a more cost-effective and environmentally better way for departures from GB south of Birmingham. Can a goods-in-transit system be achieved, and, if it is established, what impact would it have on the current established arrangements and tariff arrangements?
Mrs Scullion: To an extent, we in TSS have implemented solutions for goods in transit and goods that come from GB into Northern Ireland via Ireland. There are systems and supports in place in TSS, but, again, they are evolving. I am aware of a further, imminent release on those transit journeys. I cannot remember precisely which aspects are about to be released, but we have done a great deal of work on providing support and systems for the transit. One of the quotes that Christian referred to was on what we have done in the transit arena, but, as you rightly say, things are evolving and changing. We will have more work to do, no doubt, in order to make the transit journeys as easy as possible, but support is available at the minute.
Mr Benson: It is worth pointing out, Mary, that that is dedicated support. We have a dedicated, ring-fenced team of agents who deal only with those transit enquiries and transit arrangements and provide support to traders who wish to use that route.
Mr Reilly: To be clear, TSS provides a transit solution for GB to Northern Ireland via Ireland. That is up and running, and businesses are using it.
Mr Stewart: Thank you, folks, for your answers. They have been helpful. I will say at the outset that the protocol is adding barriers and friction to trade, particularly east-west. That will only increase costs and, ultimately,
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will be bad for Northern Ireland. Having said that, I wish that all Departments and organisations were as willing to embrace feedback and change as you have been so far. I know that work has been done on many of the issues that were raised initially to overcome them or, at least, recognise them.
One problem that keeps coming up from a couple of companies in my constituency is that goods originating in GB and EU are able to benefit from only one preferential rate for inter-country movements. For example, a Polish company makes a product that is bought by a GB company, but, if it is sold on to Northern Ireland, a tariff is applied, whereas, if it is sold on to any other UK company, that is not the case. Is that still the case? Is anything being done to overcome that? What work is being done with GB suppliers who to date have not been willing to engage and are now excluding the Northern Ireland market for fear of the bureaucratic nature of the process?
Mr Reilly: I will take the first part of that. You are describing a peculiarity of a feature of how the rules of origin work under the trade agreement with the EU. Something called "returned goods relief" is available. When the goods that move from the EU into GB, for instance, are in free circulation and then move into Northern Ireland, those traders could use the UK trader scheme if the goods are staying in Northern Ireland. However, if the goods move on to the Republic or elsewhere, the returned goods relief option is available. That means that you can get relief against those tariffs. The Trader Support Service will support traders in that. There is guidance from HMRC on how that operates. We would be happy to speak to any customers or constituents of yours to talk them through the process, if that would be helpful.
Your second point relates to GB suppliers to Northern Ireland. As Christian and Mary said, there has been a lot of outreach to the GB supplier network that is registered with the Trader Support Service. More widely, HMRC is targeting GB suppliers as far as possible to ensure that they are, first, aware of what the protocol requires, and, secondly, aware of the help and support available with those movements from the TSS and elsewhere to ensure that they make the right choices. We are doing as much as we can to try to identify, communicate with and target those businesses so that they realise how straightforward the process can be when they utilise the Trader Support Service etc.
Mr Benson: It is also worth pointing out that the trade bodies, which I mentioned and with which we have ongoing engagement, are being very helpful and supportive.
We are getting positive feedback from them, so we are encouraging them to reach out to their members and spread the word that the TSS is working and is simple to use.
Mrs D Kelly: Hello, everyone. Thanks very much for the presentation. I join others in thanking the TSS and others for working alongside operators during what has been a difficult time for everyone following Brexit. Is any advice available on specialist goods and specialisms so that operators do not have to go to one source but can reach a range of experts readily?
Mrs Scullion: Our support system across the TSS consortium is as Christian described. We have tier 1 people who do the simple things. Tier 2 agents tend to be people with some customs experience. They answer slightly more detailed queries. It is probably our tier 3 agents to whom you refer specifically and, in fact, our range of senior advisers, who do a lot of the engagement with individual organisations and trade associations. In recent times, we have aligned those tier 3 agents with specific areas of specialism or sectors, if you like. They are the people who can best serve a particular sector in the business community. It is those agents who need to be aligned with some of the queries to which you referred. When a business approaches the TSS and it is clear that its queries are sector-specific, we can make sure that it is directed to the right part of our organisation. More and more, we align people with sectors and specialisms.
Ms Bailey: Hello. Thanks very much, everybody. Since some people are recording their views, I think that we can all agree that Brexit has been the disaster for Northern Ireland that was predicted and has caused deep problems. There was certainly a lack of preparedness as well.
Following on from the questions on goods in transit, I think that the Irish customs declaration system can be done online and edited up to the point of travel for ease of use for traders. Is that right? If so, is HMRC looking at ways to adapt its system to something similar? I also note that HMRC recently told a House of Commons Committee that a solution had been found to an issue that could have seen NI steel importers face a 25% tariff. The solution means that importers can access a quota and not have to pay the EU safeguard charge. Has that solution worked and been successful? Can something similar be applied to other sectors?
Mr Reilly: Let me take the last question first. Yes, we have been working closely with business representative organisations in Northern Ireland, particularly Manufacturing NI and its businesses, to find solutions to the steel issue. There is a measure in the Finance Bill setting it out that rest-of-world steel importers can access the in-quota rate, where the UK and EU quotas are open. Traders have availed themselves of that. Equally, on the GB to Northern Ireland route, traders can access an in-quota rate on movements in that direction. In other words, steel will not be subject to a tariff where those quotas are open. That has been working and operating well. We are aware of other sectors in which there are issues with trade defence measures etc, and we continue to work closely with the industry to understand those issues and develop solutions.
The HMRC goods vehicle movement service (GVMS) and customs declaration service are modern and flexible systems that allow traders to pre-lodge but also to amend their processes up to the point at which they move the goods. It works in a similar way, as, I think, you were describing, to the Irish system, which I am less close to, obviously. The points made by Christian and Mary about groupage solutions also help in that respect, in that traders can make changes right up the point at which they enter goods into the goods vehicle movement service. That also allows for flexibility.
Mr O'Dowd: Thank you to everyone for the presentation.
Earlier this month, we saw the British Government take unilateral action on the protocol and change dates to October. We are seeing the protocol being used in the negotiations between the British Government and the EU over what is happening in Dover more than over what is happening in Belfast or Larne. Concerns have been raised that HMRC will not be in a position to move forward with a customs declaration service in October. Can you offer any reassurances that that will not be the case and that HMRC is being properly resourced and driven to ensure that a customs declaration service will be in place by October?
Mr Reilly: The customs declaration service is already a live system: it is in place. It has been in place for a time, and it was in place for Northern Ireland from the end of last year. The Trader Support Service links into the customs declaration service.
I think that you refer to the parcel easements up to October. As I said, we are looking, in particular on the business-to-consumer side, to get pragmatic and proportionate solutions to the issues. The customs declaration service will be scaled to ensure that it can meet whatever the requirements are for declaration numbers. We are confident of that.
Ms Kimmins: Thank you to everyone for the presentation. My questions are linked to what Stewart Dickson asked about staff numbers and service demand. There was an assertion that the TSS is under-resourced. To my knowledge, however, there are 36,000 registered traders and 1,000 staff, so, theoretically, for each member of staff, 36 companies are being advised. Mary, you said that, at the minute, you are capable of delivering the service, and I assume that not all those companies require daily advice. With calls being answered so promptly — within six seconds on average — it appears that demand for the service is very high. Considering that £355 million has been set aside for the scheme over two years, I have concerns. That is a monumental amount of money. Can we get some clarity on value for money?
Mrs Scullion: I will need to leave the value-for-money judgement to HMRC colleagues. To date, we have successfully moved 337 consignments into Northern Ireland. We have those 1,000 people, but they are not necessarily aligned in the simple maths way of having one person to 36 companies. That is not quite how we operate or are organised. We have stakeholder engagement teams, which do outreach with trade organisations through the seminars that we described and have one-to-one advice sessions with customer organisations in which we describe exactly how they move through the system. We have technical teams that look after the platforms.
We have a contact centre with 750 agents. Some of them are dedicated to exports and, as we described, some of them are dedicated to transit, and we have a tiered system for inbound and outbound calls.
As we said, a lot of what is being done is a digital solution. The technical and business process teams are engaged in deploying both the technology and business process aspects of that solution. The people who are engaged on this work across a broad range of roles and duties. We have never thought of it in terms of there being one person who looks after 36 companies. That is not how we operate.
We have spoken about the material that we have produced and the knowledge articles that need to be produced for our customers. We produce a weekly bulletin advising traders about new releases, changes to the HMRC system that will affect the overall process, and any policy decisions and so on. A huge amount of effort goes into developing that material.
From the point of view of overall value for money, I assure you that those people work exceptionally long hours. They are also incredibly proud of what they have achieved in a very short timescale. It is not for me to judge the overall value for money, but I assure you that those people work every hour that has been sent to them so far.
Mr M Bradley: Thank you to Christian and his team for their presence and for their presentation this morning.
I will add to others' comments my opposition to the protocol. It is an unnecessary burden for Northern Ireland traders, whose largest market is the mainland.
The major concerns that we hear as MLAs relate to delays in the delivery of plants, trees and seeds and the need for phytosanitary certificates and numerous checks by authorities. Delays can result in serious damage to the viability of those products and damage to the plants. What plans are in place to mitigate the risk that delays in transport can pose to the quality of those goods?
Mr Benson: TSS has been set up to facilitate the movement of goods, specifically as they go through customs processes. Although we provide advice and guidance on SPS certificates where we can, it is not within the scope of TSS's responsibility to create those certificates and make that happen. As I said, we work closely with DEFRA and DAERA. I mentioned the example of groupage of fish, where we worked hard with DEFRA and DAERA to ensure that fish could be moved over the New Year period. Wherever possible, we try to help to coordinate whatever needs to happen for individual traders and to ease the overall process, but SPS certificates and that side of things lie beyond the scope of the TSS service.
The Chairperson (Dr Archibald): Concerns have been raised about the need for consignment-level declarations for business-to-consumer packages and what that might mean for people and for businesses. Has any consideration been given to, for example, bulking procedures being an option in respect of that?
Mr Reilly: I will take that one. As you are aware, the Government have announced a six-month easement period for business-to-consumer parcels. The Government are looking for a proportionate and pragmatic solution to ensure that it protects the Northern Ireland consumer and does not add excessive burdens. We are looking to work with the Commission to get solutions that are sensible and proportionate. In that context, there are clearly issues, such as those that you described, that we would want to consider.
The Committee Clerk: Are there any further questions?
Mr Harvey: First, the protocol is not necessary. I do not agree with it nor do I want it, but I will move on.
The service provided by you in the TSS is only to be praised. You have been invaluable in keeping the wheels turning, and you can give guidance in minutes that could take hours, days or a week. I appreciate the help that you provide to
and small businesses alike.
I will direct my question to HMRC. It is on the second-hand margin scheme and the impact that could have on local traders and consumers, especially with regard to used motor vehicles. Can HMRC provide an update on that derogation from EU VAT rules? If you have time, maybe you could tell me what other sectors were affected by the second-hand margin scheme.
Mr Reilly: We are working with the Commission to agree a derogation in respect of the second-hand margin scheme. In the interim, the Government issued guidance to traders on how they can continue to apply it to motor vehicles sold since the end of the transition period. We can send you a link to the full guidance on that, if it would be helpful.
The Chairperson (Dr Archibald): I have a final question. As we move forward and the British Government enter new trade agreements with other countries, has there been any assessment of the need for increased diligence of the trade from Britain to the North? That may include goods at risk and the potential for those to move into the EU single market.
Mr Reilly: I will take that question. I am sorry: I did not quite get the beginning of it. My IT was playing up a bit. Can you repeat the question, please?
The Chairperson (Dr Archibald): No problem. Moving into the slightly longer term, as the British Government move towards finalising new trade agreements with other countries, has there been any assessment of the need for increased diligence of the trade between Britain and the North, with the potential for goods to move into the EU single market?
Mr Reilly: The UK trader scheme has been set up to provide the necessary checks in respect of whether those traders can claim that goods are not at risk and will stay in Northern Ireland. We are making sure that, in the process of them applying for the scheme, we put in place the right assurances that those traders can demonstrate that the goods will stay in Northern Ireland. We are taking that approach across the piece.
Mr Boylan: Chair, thank you for chairing the meeting. There are a lot of people in, and a lot of questions were asked.
Aidan, my question is to you and Christian. I am looking for clarity. At the start, there were concerns about poor levels of uptake of registrations for the scheme. You said that you predicted that there would be 24,000 but now there are 36,000. You might like to write to the Committees to give us the information, but, for clarity, where did that data come from? You said that it was in a HMRC database, but where did you get that data? Other members asked about the potential figures. Where did you get that data, and what could the potential numbers be? Can we have those, please?
Mr Reilly: We can provide you with the basis of that. It is fair to say that there was less data, obviously, on movements GB to NI before, so data sources were limited. However, within that, we came up with figures that were our best estimates, but we can provide you with the basis on which we came up with them.
Mr O'Dowd: Aidan, if I could just go back to the point I was making in my previous question, in relation to the customs declaration service and the uplift that we require in parcels etc. I think that you said at the end of your contribution that you were confident that the service would be at the level required by October: is that the case? If it is — I do not expect you to answer this, though you may if you want — it suggests that there would be no further requirement for any unilateral action by the British Government in relation to pushing back deadlines.
Mr Reilly: To be clear, the key driver for the easements in respect of parcel movements is to ensure that suppliers and the fast parcel operations are ready to comply with the requirements and that the requirements are sensible and proportionate.
What I am saying in respect of the customs declaration service is that we are confident that it has been scaled to the capacity to meet any declaration requirements in Northern Ireland, but obviously, in due course, the customs declaration service will be the system, the service, for GB traders as well. We are looking to scale it significantly across the piece. Thanks.
The Chairperson (Dr Archibald): Are there any additional questions? No.
Thank you, Christian, Aidan, Mary and Julie, for being with us this morning. It has been a useful briefing for all members. I highlight to members that any additional questions or issues arising from the session for follow-up will be taken forward by the Economy Committee team. If anybody has anything, they should forward it to the Committee email address.
I advise members that we will seek your agreement for the minutes of the meeting to be agreed by the three Committees. Is that OK by the three Committee Chairs? It is.
I thank all members for taking part in this morning's meeting and thank Michelle and Philip for their assistance and the Committee teams for the efforts that they have put into getting it set up for us.
Mary, do you want to come in?
Mrs Scullion: Can I just say one thing? As a consortium, we very much appreciate that you have many concerns and questions about what has happened and is happening and how we are proceeding. Given your comments today, we very much appreciate that you acknowledge what we have done to date. That is a great message for us to be able to bring back to our teams. Thank you very much for the appreciation that each of you has expressed.