Gold-plating EU laws costs food firms dear
Speaking at the Institute of Directors in London, Philip Wilkinson, director of poultry products group 2 Sisters, asked: “Why do we always gold-plate regulations and [see the government] intervene in an industry and ultimately export it?”
Wilkinson said a good example was the government adoption of the minimum permitted stocking densities for broiler chickens. “We operate on razor thin margins - not wafer thin ones.
“The difference between profit and loss can be a stocking ratio of 39kg/m2[the lower broiler density stocking level adopted in the UK] and 42kg/m2 [the maximum stocking density allowed in the EU].”
Downward spiral
Melanie Leech, director general Food and Drink Federation (FDF), praised the government’s improved understanding of the food and drink manufacturing sector but worried about the “downward spiral of legislation”.
During the round table discussion Leech said: “2011 was the year when the government really got the message that food manufacturing is the [country’s] largest manufacturing sector.”
One of the highlights of last year was the launch in December of the shared vision to grow the UK’s food and drink manufacturing sector by 20% by 2020, she added.
The joint vision between the FDF and government highlighted the contribution of growing food and drink exports to achieve the 20% aim.
“We now have an agenda to grow the sector and to get rid of the barriers to growth,” said Leech. “That would not have happened two years ago.”
But she acknowledged that red tape was continuing to hamstring food and drink manufacturers. Leech said that the industry was "on a continued downward spiral of legislation and regulation that adds costs and burdens to the industry because the wrong people write the rules and the wrong people enforce them”.
The government has a number of social policy objectives concerning food and drink but less money than before to deliver those objectives. “The government wants us [food and drink manufacturers] to bear the cost of delivery and be the mechanism of delivery.”
But the EU is “on the march” for further infrastructural regulation, warned David Webber, senior partner and md, at PA Europe. “Just when health claims are sorted, the new target seems to be soft claims,” he said.
Infringement proceedings
“Brussels is good at creating the architecture [of food legislation] but doesn’t have the infrastructure to go in and do the enforcement. The enforcement is quite variable and that creates trade distortions. But persuading the authorities [Brussels] to adopt infringement proceedings is difficult.”
Webber warned that the burden of regulation fell disproportionately heavily on small- to medium-sized enterprises (SMEs). “Regulation has to be proportionate to what SMEs can achieve,” he said.
Geoff Eaton, formerly ceo Uniq, said: “The test of regulation is can one person working on their own, employ one more person without regulations getting in the way?”
He added: “If anyone in government talks about more regulation, tell them to scrap it.”
The Business Leaders’ Summit, staged on Wednesday January 18, was sponsored by Eversheds, Chep, Lauras International and Goldteam Recruitment.
Watch out for more online news and views from the Business Leaders’ Summit at FoodManufacture.co.uk and via our Linked in group, the UK Food and Drink Manufacturing Network.
There will be more reports in the February issue of our sister title Food Manufacture. Telephone 0800 652 6512 to order your copy.
