Vol. 407 No. 2
2 Mr. G. Mitchell asked the Minister for Finance the reason he introduced a new computerised national customs clearance system in April, 1991 even though 75 per cent of customs documentation will be abolished from 1 January, 1993.
3 Mr. Noonan (Limerick East) asked the Minister for Finance if he will explain the circumstances which led to serious delays in clearing goods at cross-Border customs posts; the steps he has taken to ensure that there is no repetition of these delays; and if he will make a statement on the matter.
I propose to take Questions Nos. 2 and 3 together.
The new computerised customs clearance system, automated entry processing (AEP), was introduced from 31 March 1991 at all import and export points. This new system, which is geared towards providing a modern efficient customs clearance service, provides for the computerised processing of customs entry documents and introduces revised and more flexible arrangements for the payment of customs duties and other import and export charges. It will thus be of significant benefit to Irish importers and exporters in their preparations for the advent of the Single Market in 1993.
The AEP system itself and the managed network — operated by the Telecom Éireann/An Post subsidiary, the Irish National Electronic Trading Agency (INET) — which allows traders direct access to AEP are based on the most up-to-date open system standards as recommended by both the EC and the UN. As far as INET is concerned, AEP access is but the first of many trade related services which will be provided on their managed network and which I am confident will greatly assist the Irish trading community in their preparations for the completion of the Single Market.
By way of background I should say that the number of consignments dealt with by customs has been increasing steadily for some years now due to the increased volume of trade and growth in the use of just-in-time (JIT) consignments and deliveries. The introduction of the new system is in response to the many requests from trade representative bodies for implementation of such a system and the fact that similar systems are either in place or being developed in all other member states of the European Community. While it is correct to say that customs documentation will not be required for most intra-Community trade after 1993 the AEP system will have a continuing and very significant role in dealing with non-EC trade. It is intended to further enhance and develop the system to deal with other customs and trade-related procedures.
Under AEP, traders may have their goods cleared by inputting customs entry data electronically to the AEP system from their offices by a service known as direct trade input (DTI). This gives them the full benefit of the new system and a better service than under the old arrangements. The alternative, but less desirable option, is for them to lodge entry documents for customs input (CI) to the AEP system.
Traders experienced some delays at certain cross-Border customs stations during the first two weeks of the new system. These delays were attributable to two factors: the failure of the majority of customs clearance agents operating at the Border to avail of the DTI service and inaccuracies in documentation presented to customs for customs input.
The decision of the Border agents not to avail of the DTI service to date is one that I regret, particularly as the benefits of this service are already becoming apparent to the increasing numbers of traders who are availing of it at various other entry points around the country and are getting a better customs clearance service as a result. The initial low uptake of the DTI system has thrown an added burden on the customs staff in having to themselves input the data from relevant forms. The Revenue Commissioners have taken action to alleviate this by allocating additional staff and computer terminals at Border import points.
Generally the service to traders who have not yet participated in DTI who present correct documentation for customs input is comparable to what they received heretofore. However, as I have intimated, over 50 per cent of all documents presented for customs input during the first week of the new system were rejected because of inaccurate or incomplete information. This related mainly to the use of incorrect VAT numbers and the fact that many agents had not been authorised by importers to make an entry on their behalf under the new arrangements. The necessity for accurate documentation and timely authorisation of agents had been signalled to the trade well in advance by the customs authorities.
I am glad to say that the standard of documentation is now improving. This fact together with the increasing familiarity of users with the new system has contributed to a marked improvement in the situation at the Border.
Arising from the Minister's reply and without wishing to cut across my colleague who has tabled another question, may I put a number of brief questions?
Let us have regard to the time factor also.
I wish you had advised the Minister of that, having regard to his long reply. Can the Minister say why agents are refusing to use the system at the Border? What was the capital cost of installing this system? Is it true that the Institute of Freight Forwarders of Ireland said that the system was unnecessary since they had their own system called ICARUS? What is the running cost of the agency which is run jointly by Telecom and An Post and the cost of the 40 to 50 officials who have been working on the system to date?
I hope I will be able to answer all the questions as we go along. The Deputy may have to repeat some of them. It is a matter for decision by the customs clearance agents as to why they avail of this system. To date at Dundalk all the customs clearance agents have not taken up the system. The long delays which took place, although the position is improving, resulted from errors in documentation. It is difficult to understand why there should be a 50 per cent error in documentation from people who are so experienced at this business over the years. However, that is a fact of life and it caused considerable delays. When one contrasts that with, say, Dublin Airport — which is extremely busy — or the port of Waterford, one finds a totally different result. It is a matter for decision by the people themselves whether they input into the system or not. It is suggested that perhaps they held the view that this system might not be introduced until 1993, although it was signalled well in advance and had been requested and pursued strongly by the CII, by Irish exporters and many in the trade, in an effort to prepare Irish industry in a cost effective and efficient manner for the coming of the Single Market in 1992. The cost to a particular agent to update his system to input into it can be a variable one: it could be as low as £4,000 or it could be as high as £25,000 or £30,000, depending on the state of development of computerisation in a particular customs clearance agent's position. I visited them last Friday and met a number of the officials and we talked through the difficulties but it is still a matter of judgment for them. It was interesting to note during our conversation that some of the companies had made considerable investment in computerisation only last year and they had to decide, in making that investment, whether they would recover the cost by 1993. That was their judgment and they still have a decision to make in relation to this system. The system is good; it has many other ancillary services that can be developed from it and it is preparing Irish exporters and importers for the coming of the Single Market.
I have to say now that the time available to us for priority questions is well-nigh exhausted. I will call Deputy Noonan whose Question No. 3 refers.
(Limerick East): I would prefer to get on to Question No. 4 which the Minister seems——
That is fine, I will do the best I can. It is nearly on time. Let us have a reply to Question No. 4 in the name of Deputy Noonan, Limerick East.
