U.K. Outlines Plan to Avert Chaos of a No-Deal ‘Brexit’

LONDON — The British government issued its first contingency plans on Thursday for leaving the European Union without an agreement, seeking to prepare the public for possible disruptions without spreading alarm that could undermine support for the entire undertaking.

The government emphasized that it hoped and expected to hammer out a deal with the European Union. But in a series of technical documents, it warned that, without an agreement, importers and exporters could face significant new bureaucratic hurdles, that credit or debit card payments in continental Europe could cost more, and that British citizens living in the bloc could lose access to banking and pension services.

Even minutiae like the design of cigarette packs would be affected, the government said.

Dominic Raab, secretary of state for Brexit, the term for Britain’s withdrawal from the European Union, is treading a diplomatic and political tightrope in issuing the warnings. To strengthen Britain’s negotiating hand, he wants to show that it is ready to walk away from crucial Brexit talks with the European Union this year if necessary.

But in trying to prove to his European interlocutors that Britain is prepared for all eventualities, Mr. Raab knows he risks frightening the British public and weakening faith in the Brexit project, which he supports.

A no-deal Brexit “is not what we want, it is not what we expect, but we must be ready,” Mr. Raab told an audience in central London. But the ramifications of a breakdown in talks were clear from the scope of the first batch of his documents on planning for an absence of a deal: They covered financial services, the nuclear industry, blood and medical products, and exports of goods that could be used for torture.

The opposition Labour Party dismissed the documents as meaningless exercises intended to cover up the government’s failures and to obscure the true disaster of a no-deal Brexit. “Dominic Raab’s speech exposes the reality that this government is simply not prepared for a no-deal scenario,” said Keir Starmer, who represents the opposition on Brexit matters.

“The speech was thin on detail, thin on substance and provided no answers to how ministers intend to mitigate the serious consequences of leaving the E.U. without an agreement,” Mr. Starmer said in a statement.

Business groups did not seem reassured either. “By now, few can be in any doubt that ‘no deal’ would wreak havoc on economies across Europe,” said Josh Hardie, deputy director-general of the Confederation of British Industry. He added that those who argue that it would be acceptable to shift suddenly to trading under the rules of the World Trade Organization “live in a world of fantasy, where facts are not allowed to challenge ideology.”

Mike Cherry, national chairman of the Federation of Small Businesses, said, “The dangers of a sudden and unplanned no-deal Brexit have today been laid bare,” adding that “the smallest firms will be the least able to cope with a cliff-edge moment.”

Meanwhile, Dr. Chaand Nagpaul, chairman of the council of the British Medical Association, a professional body for doctors, warned of “a catastrophic impact for patients, the health work force, services and the nation’s health.”

For now, Britain is still part of the European Union’s single market and customs union, assuring the uninterrupted flow of goods and services across international borders. Every day, thousands of trucks pass through the port of Dover in England without stopping, as part of a flow of trade to and from continental Europe.

But all that could change with a no-deal Brexit, and there have been warnings of gridlock at Dover, with supplies of some food and medicines running short within days, and of factories losing crucial supplies.

“The free circulation of goods between the U.K. and E.U. would cease,” one government document confirmed, adding that “customs declarations would be needed when goods enter the U.K. (import declaration) or when they leave the U.K. (an export declaration). Separate safety and security declarations would also need to be made by the carrier of the goods.”

Businesses, it added, should consider their options and “whether they should engage in the services of a customs broker,” as the bureaucratic requirements might be unmanageable for smaller firms.

Britain would plan to reduce dislocation in some sectors, for example by recognizing medical devices approved for the European market.

But consumers could feel the effects, with the cost of some card payments likely to be affected for those using them abroad. “The cost of card payments between the U.K. and the E.U. will likely increase,” one document said, noting that they would no longer be covered by the surcharging ban currently in place.

For Britons living in the European Union, the documents suggest that access to British banks or pension payments might be disrupted. One paper noted that could mean they “lose the ability to access existing lending and deposit services, insurance contacts (such as life insurance contracts and annuities.”

As with cigarette packaging, logos on organic food would need to change, and exporters might not be able to market their produce as organic in continental Europe.

With Britain scheduled to quit the European Union at the end of March, talks remain deadlocked. If there is a breakthrough this year, Britain would enter a transition period during which little would change until the end of 2020.

The worry is that the negotiations will fail, leading to a sudden change in trading rules, the so-called cliff edge scenario feared by many businesses.

In his speech, Mr. Raab did little to suggest that Brexit was likely to reduce bureaucracy — a point often raised by critics of the European Union.

Mr. Raab said that more than 7,000 British officials were working on Brexit and that funds had been allocated for a further 9,000. Around 300 extra border officers have been recruited, with plans to add 1,000 more staff members.