‘Reduced availability and higher prices’: Food sector slams no-deal Brexit preparation

23-Aug-2018 - Last updated on 24-Aug-2018 at 07:59 GMT

Food sector says no-deal Brexit would push up prices and result in shortages ©iStock/andrej_k

UK food makers have slammed technical papers released by the Government outlining what they may face in the event of a ‘no-deal’ Brexit.

Setting out what he described as “practical and proportionate” advice should the UK crash out of the European Union without a deal next March, UK Brexit Secretary Dominic Raab said that the 25 documents outlined how the UK will work to mitigate the impact of a no-deal Brexit on businesses and institutions.

“These technical notices, and the ones that will follow shortly, are a sensible, measured, and proportionate approach to minimising the impact of no deal on British firms, citizens, charities and public bodies,” Raab said in a speech delivered in London today (23 August).

Addressing what he described as “misinformation” that the UK could face post-Brexit food shortages, Raab insisted: “In reality, our food and drink supply is diverse.”

“In 2016, DEFRA food statistics show, the UK supplied half of the food we consumed. 30% did come from the EU, 20% from the rest of the world. Who is credibly suggesting, in a no deal scenario, that the EU would not want to continue to sell food to UK consumers?

“In any event, we’ve set out practical measures to mitigate any risks of disruption to supply. Through the recognition of EU food standards, our pursuit of equivalency arrangements on food regulation with the EU and indeed with non-EU countries, and through our support for UK farmers in terms of financial funding schemes.

“Let me reassure you all that, contrary to one of the wilder claims, you will still be able to enjoy a BLT after Brexit.”

‘The facts of a no-deal Brexit: reduced availability and higher prices’

Food retailers and manufacturers found little comfort in Raab’s words, insisting that a no-deal scenario would be catastrophic for UK food supplies.

In particular, the food sector is concerned that additional red tape will make ‘just-in-time’ supply chains unworkable while increased costs will push up prices for consumers.

Helen Dickinson, CEO of the British Retail Consortium, explained: “Our food supply chain in particular is fragile and based on just in time principles, ensuring efficiency and economies of scale, bringing huge benefits to the British shopper. Any delays caused by increased red tape will have a serious impact on over one-third of our food imports. The Government's technical notices demonstrate the facts of a No-Deal Brexit - reduced availability and higher prices of food and medicine, increased delays and red tape at borders, and a VAT bombshell for consumers and businesses.”

Food and Drink Federation chief executive Ian Wright was no more upbeat, describing the “grisly prospect” for UK food and drink should an exit agreement with the EU not be reached.

“There is no sign of further progress on negotiating frameworks with the devolved administrations. There is no substantive information on mitigating the effect of ‘no deal’ on the island of Ireland, where the implications would be most significant,” Wright stressed. “Moreover, the UK food industry will doubt that the Government could replace TRACES (the EU Trade Control and Expert System that tracks the entire trade and certification process for animals, food, feed and plants) with a new, comprehensive, functional UK alternative IT system in time for the end of March.”

He concluded: “The new burdens potentially facing food and drink exporters and importers set out today will frighten many SME food businesses.”

Problems ahead for organic?

The UK’s organic food makers are particularly vulnerable to the negative consequences of no deal, it transpired today.

Setting out how organic certification requirements might look if no deal is reached, the UK Government concede that UK organic exporters could face a ban on exports of at least nine months while new certifications and approvals are sought.

“The technical notices... offer no further clarity to businesses and provide neither reassurance nor advice on how to prepare for a potential ‘no deal’ scenario. They confirm the scale of the challenge we face and the vital importance that the UK achieves a workable deal with the EU,” The Soil Association’s head of standards Chris Atkinson said.

“The information outlined raises concerns that imports and exports to and from the EU may be held up for months. The critical issue of continuing recognition by the EU of the organic status of products certified in the UK is left entirely unresolved by this paper and a similar document that was issued by the EU some months ago.”

Atkinson echoed concerns about the UK Government’s ability to replace TRACES by 2019, suggesting that this ambition is “an unrealistic goal” within the time frame. “Delays could significantly hinder trade,” he warned.

“The EU is the UK’s closest, largest and most important trading partner, therefore ensuring effective trade with the EU should be the immediate priority over trade deals with other countries. Such deals pose potential risks, particularly to UK food and farming, partly due to the risks of allowing food of lower production standards to enter the UK. Irrespective of what form Brexit eventually takes, there is serious concern that UK farming will also lose the ring-fenced budget for farm payments that all other EU countries will continue to enjoy.”