Brexit transitional period needed, urges FDF

By James Ridler contact

- Last updated on GMT

The Food and Drink Federation urged the government to confirm a Brexit transitional period
The Food and Drink Federation urged the government to confirm a Brexit transitional period

Related tags: International trade

Brexit could cost thousands of food and drink industry jobs, force businesses to downsize and block supply chains, if the government does not agree a post-Brexit transitional period in the lead up to it, warned the Food and Drink Federation (FDF).

The FDF’s warnings were submitted in written evidence to Parliament’s Business, Energy and Industry Strategy committee, ahead of an inquiry into implications of Brexit for the UK processed food and drink industry.

The food industry trade body repeated calls for transitional arrangements to ensure businesses had continued access to the EU markets until a comprehensive trade deal was been agreed, ratified and entered into force.

“We strongly support a transition period which ensures that businesses will have to adapt to only one set of changes to minimise cost, unnecessary disruption and impact on consumer prices,”​ it said.

“Crucially, this process of transition cannot begin until there is certainty about the end goal of the whole transition process.”

Consequences for jobs and investment

The FDF warned that without early confirmation of a transition period, some food and drink companies would have to make serious decisions at the start of 2018 that could have detrimental consequences for jobs and investment in the UK.

The trade body urged that any transitional period should last for however long it took the industry to prepare and readjust to regulations and processes in post-Brexit Britain.

The FDF also warned that a no-deal scenario could lead to massive delays in the supply chain.

“Food is part of the UK’s critical national infrastructure and ‘just-in-time’ supply chains mean empty shelves in four days or fewer if supply is delayed or interrupted. Most food has a limited shelf-life and some is highly perishable,”​ it said.

“Many manufacturers form part of complex European supply chains, developing local specialisations which help to boost company competitiveness. The ability to import and export goods and ingredients seamlessly across borders is critical to business models.”

Rise in duty

The lack of an UK-EU trade deal would also lead to a rise in duty on a number of foods, should World Trade Organisation (WTO) tariffs apply on imports.

Under WTO rules, tariffs on meat could reach a maximum level of 104%, while tariffs on fruit and vegetables could be up to 157%.

The FDF said: “It is vital that government ensures that essential imported ingredients and raw materials from the EU and countries with which the EU has preferential trade agreements do not face tariffs or costly non-tariff barriers after we leave the EU.

“This access is essential to enable continued growth of both UK food and drink production and exports, and to avoid the very real risk of price rises and reduced product choice for consumers.”

Meanwhile, food industry leaders on both sides of the English Channel have urged British and EU policy makers to make rapid progress on Brexit trade talks.

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