SHOPPERS face the prospect of higher food bills and empty supermarket shelves if the UK Government fails to get a free trade deal with the European Union, peers have warned.
In a bleak assessment of a possible post-Brexit world, the House of Lords EU Energy and Environment Sub-committee flagged up conditions that could lead to panic-buying because of food shortages and gridlock on the motorways as lorries are delayed at ports.
Customers could be left in a two-tier system that meant the better-off bought more expensive, British goods, while poorer people were left with lower-standard cheap imports.
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Peers said there was a "striking" contrast between Government confidence about the potential impact of Brexit on the price and availability of food and concerns raised by the industry.
The report explained if there were not trade agreement by the end of the transition period in December 2020, then UK-EU trade would continue under a default framework governed by the World Trade Organisation.
This would oblige the UK to treat imports from the EU in the same way as imports from any other country, including imposing the same tariffs on food imported from the EU as from outside the EU.
“If an agreement cannot be negotiated, Brexit is likely to result in an average tariff on food imports of 22 per cent. While this would not equate to a 22 per cent increase in food prices for consumers, there can be no doubt that prices paid at the checkout would rise,” said the report.
“To counteract this the Government could cut tariffs on all food imports, EU and non-EU, but this would pose a serious risk of undermining UK food producers who could not compete on price.”
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The committee pointed out how half the UK’s food was imported with 30 per cent coming from the EU and another 20 per cent from non-EU countries. “Any change to its trading arrangements could affect the country’s food supply,” it noted.
While the average EU tariff on food is 22 per cent, there is significant variation. For example, the tariff on whole milk is 70 per cent, beef is subject to a 56 per cent average tariff while that on poultry is just 14 per cent.
The report found that it would not be possible to increase food production in time to meet any shortfall caused by Brexit.
Falls in EU labour could lead to an increase in recruitment or higher wages for domestic workers; the costs might have to be passed on to customers or some businesses "may cease to be viable".
The report explained: “If no agreement is reached and food imports from the EU are subject to the same customs and border checks as non-EU imports, the UK does not have the staff, IT systems or physical infrastructure to meet that increased demand.
“Any resulting delays could choke the UK’s ports and threaten the availability of some food products for UK consumers. The Government’s proposed alternative is to allow EU imports through with no, or very few, checks: this raises safety concerns as well as questions over how customs charges would be processed.”
The committee pointed to a study by the Food Standards Agency found, which found one in five households were already experiencing, or were on the margins of, food insecurity. Any increase in food prices as a result of Brexit would add to this insecurity.
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Lord Teverson, the Committee Chairman, said the Government had some important choices to make.
“They have said they want to maintain high food standards but also that they would be willing to have minimal customs checks to avoid disruption at borders. They have said they want UK food and farming to be exemplars of high-quality production but also that they will seek trade deals that secure lower prices for consumers.”
He added: “The UK needs a comprehensive food policy, to tackle these complex issues, and we urge the Government to produce one with some urgency,” he added.
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