Doubts Surround U.K.’s Readiness for Brexit

The debate about how to enact Brexit is not limited to any sector of government or business: It affects a multiplicity of U.K. sectors and organizations. In the year since the historic referendum vote that set Brexit into action, each individual sector has examined the decision’s potential impacts. In the realm of food safety, security, and sustainability, a new report by food policy specialists at the University of Sussex’s Science Policy Research Unit warns that at its present rate, there will be no way for the U.K. to be adequately prepared for the effect Brexit will have on the U.K. food system.

The report, titled “A Food Brexit: Time to Get Real,” was authored by Professor Erik Millstone, (University of Sussex), Professor Tim Lang (City, University of London), and Professor Terry Marsden (Cardiff University), and its conclusions are damning. Even a “soft Brexit”—under which U.K. would leave the European Union (EU) but maintain access to the single European market on a tariff-free basis—will have enormous implications to food and agriculture prices, quality, and supply in the U.K., the report argues. At present, there is no agreement in government about how to move forward into “food Brexit.”

Since the report was published in mid-July, says co-author Prof. Millstone, responses to it have revealed sharp differences of opinions amongst government ministers.

“In particular,” Prof. Millstone explains, “the Secretary of State at the Department for the Environment Food & Rural Affairs (Michael Gove) said on several occasions that he would not accept any reductions in U.K. food safety standards after the U.K. leaves the European Union. On the other hand the Secretary of State at the Department for International Trade (Liam Fox) made it clear that, in exchange for a free trade deal with the USA, he would happily accept U.S. products and processes that are not currently deemed acceptably safe in the EU or the U.K. Meanwhile, the British Prime Minister has been unwilling to respond to questions on the matter.”

Specific to the debate about accepting U.S. products, Prof. Millstone notes, have been concerns such as the use of disinfectant washes for poultry meat, and the acceptability of U.S. beef produced using growth hormones. He adds that U.K. food producers have largely positioned themselves closer to the standard-firm position of Secretary Gove than the standard-flexible position of Secretary Fox.

“Because most U.K. companies want to continue to be able to sell their products in EU Member States,” he says, “they argue that U.K. food standards should continue to be the same as those in the EU, or even higher.”

Phil Gibbs, executive director for Europe, the Middle East, and Africa at Supply Chain Management software company Llamasoft, underlines that the amount of food coming into the U.K. from the EU means this is very much a two-way debate.

“As the report says, 35 percent of labor in food manufacturing is from the EU, so any restrictions on free movement will have a major impact,” Gibbs says. “Also, almost half of food is imported, so future trading arrangements will be critical to sourcing and will have an impact on both pricing and security of supply.”

The report lists 16 issues to which its authors appeal the U.K. government to provide responses. These include:

• The present lack of formal vision for what a post-EU food-system will look like;
• The necessity of new food legislation to replace 4,000 EU food laws that will no longer be in force;
• The threat of a drop in food quality once the EU’s food standards are no longer in force;
• A demand for replacing the EU’s Common Agricultural Policy and Common Fisheries Policy with new U.K. policy;
• The inevitable cost of tariffs raising food prices by as much as 22 percent; and
• Increased volatility of food prices.

“The biggest problem that businesses in the U.K. face is the uncertainty of what Brexit will be,” Gibbs explains. “There are a huge range of scenarios around trading arrangements, movement of labor, and currency exchange rates which have been simplified into the terms ‘soft Brexit’ and ‘hard Brexit.’ At the moment businesses can assess scenarios and make plans for different Brexit outcomes, but are unlikely to implement them due to the uncertainty. Restructuring your supply chain to reflect a particular tariff structure and set of exchange rates would be very unwise at the moment.”