Poor returns threaten to upset trade statistics

THE Government's new system for collecting trade figures was described as chaotic this weekend after 65 per cent of companies due to submit documents missed the deadline, writes Russell Hotten.

If the poor response continues, it will significantly distort vital statistics on the UK's balance of trade with the EC - and make them worthless.

New Europe-wide rules on filing import-export information came into force on 1 January with the creation of the single market, affecting some 30,000 VAT-registered UK companies.

Instead of handing over paperwork through agents at ports and airports when goods are moved abroad, companies now submit monthly returns. Customs & Excise said only a third of companies met Friday's deadline for January. This was despite a large and costly advertising campaign by the department to highlight the changes.

A spokesman said that any faults in the new procedures should be ironed out by June, when the new system will be used to compile published trade figures.

But a customs official in Dover said this week: 'This is nothing like the response needed. You are relying on the good will of the trader to supply the correct information. Either deliberately or out of ignorance, traders will get it wrong. It increases the scope for fraud, because companies know the chances of having paperwork checked at ports is slight. The chaos will continue for months.'

Inaccurate figures will also damage companies that rely on detailed breakdowns of the statistics to uncover new and expanding markets.

Customs & Excise will impose stiff penalties for late filing - after the 10th day of each month - but has agreed to show leniency 'at the start'.