Britain will "pay the price" of a no-deal Brexit because complicated new border controls may not be ready in time, a UK government watchdog has warned.
The National Audit Office (NAO) said that new border checks could lead to delays at crossing points, increased risk of customs non-compliance and queues of lorries, for example, trying to cross onto the European continent at Dover and Folkestone in Kent.
Of 12 "critical" projects preparing Britain's borders for a no deal, 11 were "at risk of not being delivered on time and to acceptable quality", the NAO said, adding that thousands of UK exporters did not have enough time to prepare for new border rules. 423bn of trade crosses UK borders every year, much of that with the EU or onto other destinations via the rest of Europe.
Outside the EU there will need to be new border controls and if there is no deal those controls will have to be stricter than if Britain agreed a "soft" Brexit which included a 19 month implementation period.
The NAO said that under a "no deal" up to 250,000 firms may need to fill out customs declarations forms for the first time as Britain moved onto World Trade Organisation (WTO) rules. Her Majesty's Revenue and Customs (HMRC) - which collects taxes at the border - could also have to deal with as many as 260 million customs declarations a year, up from 55 million.
The Federation of Small Businesses national chairman Mike Cherry said the report was "deeply troubling". He added: "With less than six months before exit day, it is dreamland stuff to think that we will be anywhere near having the infrastructure needed to track and examine goods at the border.
"The likelihood is that our small business traders will face delays for goods crossing the border, while also being hit with extra costs associated to new customs arrangements and tracking requirements."
Criminal gangs could also exploit any border weaknesses and queues and delays were likely at border crossings, the NAO report added. "Government's assumption that the risks will not change materially on day one is reasonable in the short term but organised criminals and others are likely to be quick to exploit any perceived weaknesses or gaps in the enforcement regime," it continued. "This, combined with the UK's potential loss of access to EU security, law enforcement and criminal justice tools, could create security weaknesses which the government would need to address urgently."