CONTINGENCY plans are being called for to ensure the safe supply of food to the population in the event of energy blackouts. It sounds like it could be 1973, or 1943. This is today.
Scottish businesses are “struggling just to keep the lights on, fridges cool and the wheels turning”, energy, fuel and staff wages are bringing burgeoning costs to food wholesalers, with one firm facing a monthly energy bill rise from £42,000 to £360,000.
A group of MPs has been considering this, along with further evidence from food and drink supply chain chiefs, and the depth of the crisis is only now starting to become clear, with energy, Covid, Brexit, and changing UK Government policy blamed.
The All-Party Parliamentary Group on the Food and Drink Supply Chain was told by executives and business representatives that early advance warnings must be given in the event of blackouts to help safeguard the supply of provisions.
Details of energy supply should be shared with businesses “to mitigate the worst impacts of the energy crisis”, it is suggested.
MPs also heard that more firms will go bust, there will be more jobs lost, and a sharp decline in investment is also likely to follow should food supply chain businesses miss out on energy support after March, with the prospect of means-testing looming in six months following the newish Chancellor Jeremy Hunt’s relief rethink.
The Scottish Wholesale Association said: “Consolidation has already been seen by Scottish SME wholesaler, Iain Hill Ltd, being taken over by JW Filshill, and the business failure of the UK’s biggest wholesale distributors of healthy, natural and organic products Tree of Life UK and its subsidiary Health Stores (Wholesale).
“Such stories will continue if action isn’t taken to prevent further cost and supply issues within the marketplace.”
Sales lag pre-pandemic levels
A Scottish survey found the wholesale sector is still on average nine per cent down on pre-Covid sales. However, specialists in on-trade, such as bars, restaurants and hotels, are still trading down 37% on average.
The SWA, which praised the Scottish Government Covid resilience fund, said that “government must again take action to support the wholesale food and drink supply chain and its customers, from the hospitality and tourism sectors to our schools and care homes”.
The APPG, set up earlier this year to “champion the food and drink supply chain in Parliament”, will consider the firms’ evidence ahead of its report to the UK Government.
Shining a light on a complex industry to ensure stability during blackouts in this way can only help government focus on the increasingly terminal hardships with which companies are grappling.
The Chancellor’s early interventions have also come under the microscope of business editor Ian McConnell, who reminds us of Mr Hunt’s earlier role in austerity, adding that “scrapping the previously promised two-year energy price guarantee from next April was the one thing he should absolutely not have done”.
Also this week, business correspondent Kristy Dorsey talks to John Jackson, the owner of Braw Beard, about how he set up the grooming firm after he had a mountain biking accident, and how he has also been on the receiving end of some unusual requests.
Office for National Statistics - Economic indicators at a glance:
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