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LEAH FARRELL

'Concertina effect': Supply chain and shipping disruption could last 'the entirety of 2022'

Once goods arrive in Ireland, a shortage of truck drivers is causing delays to final deliveries.

IRISH CONSUMERS AND BUSINESSES can expect little relief in the short term from the supply bottlenecks and disruption that have heaped transport costs on importers this year, supply chain experts have warned.

Major congestion at the main European feeder ports serving Ireland  — Antwerp and Rotterdam — continues to delay the flow of goods from Asia to Irish ports. 

Once the goods have arrived in Ireland, a long-flagged shortage of truck drivers — exacerbated by Brexit and the pandemic — is causing further delays.

In the run-up to Christmas, Irish haulage infrastructure is only getting “tighter” with delays of up to a week for deliveries, according to a report by Woodland Group, a UK supply chain management and consulting company with a presence in Ireland.

“Whereas we used to be able to ring one of our [trucking companies] and get a delivery, even within the next 48 hours without problems. You’re talking now potentially a week to get something delivered,” Kevin Brady, managing director at Woodland Group’s Irish arm, told The Journal.

In its ‘Asia-Ireland Supply Chain Impact Report’, published last month, Woodland cautioned importers and exporters that there is “is no quick fix” to the global disruption. Businesses and consumers can expect delays and shipping rates to remain elevated until at least Chinese New Year in February 2022, the report warned.

But in an updated version, seen by The Journal, Woodland is telling its customers that “these problems could last the entirety of 2022”.

‘Key factors’

Trade links with Asia — particularly China, sometimes referred to as the ‘factory of the world’ — are crucial for Ireland, the report highlights.

According to Woodland’s analysis, goods from Asian countries represented 15% of Ireland’s total imports in 2020, worth €10 billion, €6 billion of which came from China alone — up from €5.1 billion in 2019.

But the “growth rate of imports” from China has slowed in the second half of 2021. Delayed shipping timeframes and increased costs — due to skyrocketing freight prices — are the “key factors” in this decline, according to the report.

Covid outbreaks in China — which have resulted in the temporary closures of Ningbo, Shanghai and other ports — coupled with pandemic-related labour shortages have resulted in “mass congestion” in some cases.

Typhoon In-Fa, which struck China in July, also caused delays, Woodland said.

The cost of shipping goods from Asia to Ireland, meanwhile, has ballooned to a “record high level” over the past year or so. This is down to a number of factors including booming post-lockdown consumer demand in many European countries, a shortage of freight containers and backlogs of ships queuing to enter ports.

Symptoms of this global malaise have been generating headlines across the world.

Just this week, there were a record 77 ships sitting off the twin ports of Los Angeles and Long Beach in California.

container-ships-wait-off-the-coast-of-the-congested-ports-of-los-angeles-and-long-beach-in-long-beach-california-u-s-october-1-2021-reuters-alan-devall Container shps queing off the congested ports of Long Beach and Los Angeles in the US earlier this month. Alamy Stock Photo Alamy Stock Photo

“It’s a case of elevated demand,” Kevin Brady told The Journal. “We saw this last year in the run-up to Thanksgiving in the US. But it’s definitely a worsening situation from last year.”

Longer waits for berths mean disrupted shipping schedules, disrupting the rhythm of global trade flows and causing a ripple effect of delays across the globe. 

And European ports haven’t escaped the chaos, Brady said.

For getting containers off mother vessels [from Asia] in those base ports like Antwerp, Rotterdam and Zebrugge and getting them shipped off [to Ireland] on smaller feeder vessels, we’re talking about delays of anything between one and two weeks.

This process of loading goods from one ship to another to be brought to their final destination is called ‘transhipment’.  

Delays at major transhipment ports, both in Europe and Asia, are now beginning to impact Irish exporters, the Woodland report highlights.

They are seeing a “25-30% increase in pricing to their goods” although Irish exports, in general, have performed very well this year, led by the booming pharmaceutical industry.

‘Pinch points’

Happily, however, Irish ports like Dublin, Cork and Rosslare have coped “very well” with the disruption, Brady said.  

“There are always specific times for pinch points,” he explained. “But I think the big problems have been at origin in Asia or the transhipment ports in Europe. In fairness to Irish ports, we haven’t had a huge amount of problems. 

Where issues are cropping up in Ireland, however, are once the goods have arrived here and need to be delivered to their final destination, he said.

Although not nearly as acute as the situation in the UK, Brady said there are definitely “pressure points” emerging, which are having an impact on “final deliveries”.

Haulage companies have sounded the alarm in recent weeks about a long-standing shortage of drivers, a structural issue within the sector that has been made worse by Brexit and the pandemic. 

Earlier this month, hauliers told The Journal that many Eastern European drivers used to drive UK landbridge routes from Ireland to mainland Europe. But since Brexit, those routes have become more difficult, the result of extra regulatory and customs checks, resulting in long delays. 

So many drivers have gone back to Poland, and to the [former] Eastern bloc countries, and they avoided the hassle that way,” Wexford TD Verona Murphy — a former president of the IRHA — said in early October.

Speaking to The Journal this week, Aidan Flynn, chief executive of the Freight Transport Association of Ireland said the industry has been highlighting this issue for years.

‘Concertina effect’ 

“Our reference point for this is the Forfás report from 2015,” Flynn said.

It estimated that there “would be 33,000 job openings in the freight distribution sector up to 2025,” he explained. “About 7,500 of those would be for drivers because of an ageing workforce. So it’s not a new phenomenon.”

But the shortage has definitely been “exacerbated” by the Covid-19 pandemic, not just in Ireland but across Europe, Flynn added.

“The likes of Germany have a shortage of about 80,000 drivers. Britain has obviously highlighted the fact that they have a shortage in excess of 100,000. France has shortages and so on,” Flynn said.

The situation has been made worse in the last six months due to the “uncertainty within the industry”, he explained, with many businesses “closing and then starting up again and then closing” due to public health restrictions. 

However, Flynn said he believes the actual shortage peaked in about September. 

“Yes, there’s gonna be challenges within the supply chain for Christmas,” he said. 

But they’re more linked to global supply disruption. It’s this kind of concertina thing where you have delays and then all of a sudden you’ve got lots of products being delivered at the same time… I suppose there is a little bit of chaos built into the supply chain now because of the uncertainty.

This week, Minister of State for Business, Employment and Retail Damien English announced that the Government will scrap the quota on the number of non-EU drivers allowed to work in Ireland.

In a statement, he said removing the cap “will support the work of those businesses responsible for importing and exporting consumer goods and products to and from Ireland”.

Flynn said the move is welcome but it’s unlikely to have much of an impact in the short term.

“The demand for the permits in the last six or seven months has increased significantly and I think removing the cap definitely helps out,” he said.

But he said that competition for drivers is a “pan-European and a global issue” and FTA Ireland is focused on raising “awareness of the industry” domestically and trying to attract drivers on a local basis. 

Earlier this week, Eugene Drennan, President of the Irish Road Haulage Association told The Journal that many businesses using trucking companies have “steadfastly refused” to accept any increase to transport rates, despite the cost increases that trucking companies have incurred this year.

In the lead-in to what could be a very challenging Christmas, Flynn said the haulage sector and “drivers in particular need to be afforded respect” by businesses and consumers.

“They need to understand the actual value of the haulage sector in terms of their associations and arrangements with them,” he said. “These guys are also faced with massive increases in operational expenses due to the carbon tax increases the cost of fuel.” 

As for shipping prices and transport costs, the next few weeks will be telling, said Kevin Brady, with many major companies due to lock in their rate agreements with shipping companies for the coming year.

Those deals will “basically set the precedent for the rates for 2022″, he said.

“So, really, we’re just waiting on those big-ticket items to be concluded — and then that sets the tone, really, for everybody else.” 

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    Mute John Mulligan
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    Apr 30th 2021, 8:47 AM

    The DUP will be happy now they got rid of a woman. They can go back to the 19th century now.
    Foster may be pilloried in this part of the world, but she’s way better than what’s coming after her.

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    Mute Simon Connolly
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    Apr 30th 2021, 8:52 AM

    @John Mulligan: Absolutely, nail on the head! They are going from being in the 1800s to the 1700s!!

    354
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    Mute Colleen
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    Apr 30th 2021, 10:19 AM

    @John Mulligan: you’re not wrong, John.

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    Mute James Lough
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    Apr 30th 2021, 10:58 AM

    @Colleen: he is wrong – Arlene was a man !

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    Mute Jack Cass
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    Apr 30th 2021, 8:49 AM

    She should have been gone for the “Cash for Ash” scandal. Just goes to show the priorities of those pulling the strings in the background.

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    Mute Cowboy Paddy
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    Apr 30th 2021, 1:10 PM

    @Jack Cass:
    Her handling of COVID was was terrible…

    She killed thousands of people… Other countries can’t understand how an island policy wasn’t enacted..

    64
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    Mute Writeon
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    Apr 30th 2021, 1:41 PM

    @Cowboy Paddy: What you say is true. But unfortunately she’s not being ousted by a suddenly enlightened DUP. Quite the opposite. She was viewed as too progressive and accomodating and so her replacement is definitely going to be a step backwards for these nutters!

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    Mute family guy
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    Apr 30th 2021, 7:02 PM

    @Writeon: ‘These Nutters’ that made be chuckle. You’re correct. Religious fundamentalists are all nutters in my opinion.

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    Mute Brian Kelly
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    Apr 30th 2021, 8:47 AM

    The fallout from Brexit is taking effect and the great British empire is crumbling!

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    Mute Justin Gillespie
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    Apr 30th 2021, 9:04 AM

    @Brian Kelly: To equate Arlene leaving the DUP with the empire crumbling is a bit of a stretch tbh.

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    Mute Brian Kelly
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    Apr 30th 2021, 9:34 AM

    @Justin Gillespie: A little bit of a stretch, BUT it is taking effect. Can’t deny it…

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    Mute Pablo
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    Apr 30th 2021, 8:41 AM

    I used to think that countries with women leading them were better off, until this one came along.

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    Mute Frank Carty
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    Apr 30th 2021, 8:49 AM

    @Pablo: i take our you don’t remember the Iron Lady then.

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    Mute pat seery
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    Apr 30th 2021, 8:50 AM

    @Pablo: She might not be Your Cup of Tea but wait untill you see what comes Next

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    Mute SPQH
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    Apr 30th 2021, 8:54 AM

    @pat seery: it’s all relative isn’t it.

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    Mute Pablo
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    Apr 30th 2021, 10:05 AM

    @pat seery: Oh joy … so it’s like what Larry Dunne said when he got sent to jail for smuggling drugs – ““if you think we’re bad, wait till you see what’s coming after us.” …. and he was right.

    Need to move away from segregated schools up there or nothing will ever change

    68
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    Mute Shawn O'Ceallaghan
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    Apr 30th 2021, 10:08 AM

    @Pablo: well not every female leaders father was shot in the head and schoolbus bombed.

    Given that, you can understand her motives.

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    Mute James Lough
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    Apr 30th 2021, 10:49 AM

    @Shawn O’Ceallaghan: Nelson Mandela had a much tougher life. He was an inspirational leader. She could have less bitter.

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    Mute James Lough
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    Apr 30th 2021, 10:52 AM

    @James Lough: been * before the grammar police jump me !

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    Mute Paul Holland
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    Apr 30th 2021, 12:34 PM

    @Pablo: I think leaders reflect the people, and I wonder if Jacinda Ardern of NZ would have been as successful if she was a leader in Ireland?

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    Mute M. Murphy
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    Apr 30th 2021, 2:34 PM

    @Frank Carty: I watched the crown. I liked her ;)

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    Mute Thomas Harrington
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    Apr 30th 2021, 9:57 AM

    Now they’ll lurch more to the right continue to lose votes to the UUP and Alliance – SF become largest party at next election and then border poll …. interesting times ahead

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    Mute Justin Gillespie
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    Apr 30th 2021, 10:51 AM

    @Thomas Harrington: Very interesting times ahead. The shambles in unionism is in stark contrast to the iron discipline in SF where any threat to electoral success is being ruthlessly stamped on as Martina Anderson is finding out in Derry.
    Once thought of as untouchable because of her IRA history she has been told to vacate her seat within the next few weeks as she is seen as an electoral liabity.
    Many bumps and twists in this road yet.

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    Mute Gerard Heery
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    Apr 30th 2021, 8:42 AM

    Damage done time to go home and hide under the blankets like Cameron and frage and Boris soon to follow !

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    Mute Arch Angel
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    Apr 30th 2021, 9:20 AM

    @Gerard Heery: I can’t help but have some sympathy for her, yes I know what she is but I suspect she attempted to at least try to engage in some sort of dialogue. A major step forward in that part of the world. For this she was despised by all around her, including her own. Just look at some of the personal attacks directed at her on this forum alone. A thankless task. If the pundits are right, and who am I to doubt, there are difficult days ahead. Talks of a united Ireland no doubt didn’t go unnoticed North of the border…

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    Mute Tarraing Mo Liathróidí
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    Apr 30th 2021, 9:04 AM

    Bless they thought they were getting a DUP Maggie thatcher 2.0 when they elected Arlene, who would tackle the big bad SF and make sure the flegggggg and the DUP swamp morals good and British, and instead they got the cheap Chinese knock off version that didn’t deliver…..although as bad as she was, when you see what’s crawling out of the DUP time machine from the 1600′s, the North may regret the day she left

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    Mute Niall Power
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    Apr 30th 2021, 8:47 AM
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    Mute Ronaldo Blanc
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    Apr 30th 2021, 9:59 AM

    I wouldn’t be surprised if Michael Martin invited her to sit on the FF front bench.

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    Mute Darren Anthony Corr
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    Apr 30th 2021, 9:49 AM

    Probably for the best. I always kind of guessed that she was in way over her head with them, like she was bad, but they were way worse.
    It might be difficult to believe, as she was pretty hardline but In comparison to other ilk within that party she was more moderate. She was more 1800s as opposed to the overall party vibe of 1690 if you get me.

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    Mute Dave Hammond
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    Apr 30th 2021, 11:40 AM

    @Darren Anthony Corr: yeah and don’t forget this is the same party that shafted Ian Paisley for being too progressive.. They plan is to bring down Stormont and think they can harp back to being ‘ crucially important’ support for UK Govt like when Theresa May needed them – they aren’t – they are backwards outdated tiny minority and the wrecking ball strategy they are working to will only delay the inevitable path of border poll and progress albeit at a snails pace

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    Mute Brian Moss
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    Apr 30th 2021, 10:09 AM

    The worry is we could soon look back at Foster as some kind of great liberal which is worrying to say the least given some of the stuff she has come out with over the years whats coming next could well make Fred Flintstone look modern.

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    Mute Eamonn Byrne
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    Apr 30th 2021, 10:25 AM

    DUP are yesterday’s men. Will be wiped out in net election. Bigoted and backward and living in the past

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    Mute James Lough
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    Apr 30th 2021, 10:57 AM

    @Eamonn Byrne: dreaming pal. You don’t know anything about northern Ireland politics.

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    Mute Justin Gillespie
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    Apr 30th 2021, 1:23 PM

    @Eamonn Byrne: A classic case of pot calling the kettle black there Éamonn. Your post is as bigoted as anything the DUP would ever come out with.

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    Mute George Vladisavljevic
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    Apr 30th 2021, 9:50 AM

    When the DUP come back to renegotiate the Brexit agreement and the Northern Ireland Protocol, the Republicans should reply with ‘Never! Never! Never!’

    42
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    Mute Keith
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    Apr 30th 2021, 11:20 AM

    Cue Tubridy getting in touch for The Late Late Show

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    Mute Paul
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    Apr 30th 2021, 8:56 AM

    She’ll be remembered for …..

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    Mute Darren Anthony Corr
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    Apr 30th 2021, 9:54 AM

    @Paul:
    Being the first NI first member, and DUP leader to attend a GAA game.

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    Mute Justin Gillespie
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    Apr 30th 2021, 10:25 AM

    @Darren Anthony Corr: Trying the impossible and failing just like Paisley, Robinson, Trimble. Namely trying to reconcile branches of unionism that don’t want to be reconciled.
    They all saw that unionism had to modernise & reach out to survive but a sizeable rump of their electorate wouldn’t have it.
    Same situation Republicans in USA now find themselves.

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    Mute Jake Kelly
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    Apr 30th 2021, 9:59 AM

    She wasn’t homophobic enough

    49
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    Mute Justin Gillespie
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    Apr 30th 2021, 1:24 PM

    @Jake Kelly: Arlene wasn’t homophobic at all.

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    Mute l
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    Apr 30th 2021, 11:42 AM

    This is literally the definition of, “be careful what you wish for”.

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    Mute Leonard O'mahony
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    Apr 30th 2021, 9:26 AM

    I hear Boris is looking for a nanny….

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    Mute Michael O'Connor
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    Apr 30th 2021, 1:51 PM

    So she says that she hasn’t even seen the letter of no confidence… so she resigned on the strength of someone telling her that a bunch of people had signed a letter of no confidence in her? hmmm, doesn’t sound quite right, does it?

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    Mute Brad
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    Apr 30th 2021, 9:15 AM
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    Mute reginald
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    Apr 30th 2021, 1:13 PM

    Maybe she can visit a zoo and feed her beloved crocodiles

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    Mute Christybhoy67
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    Apr 30th 2021, 1:24 PM
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    Mute Epgenetics29 Declan Christoph
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    Apr 30th 2021, 2:13 PM

    Ignorance is bliss

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    Mute ed w
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    Apr 30th 2021, 3:48 PM

    no t the way the dup do things. stab you in the back is the dup way

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    Mute Alan Wilson
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    Apr 30th 2021, 11:45 PM

    If you own everything farms land commercial premises and government and are asked to share some of that wealth.What would you do?

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    Mute John Walsh
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    Apr 30th 2021, 9:49 AM

    DUmPed

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