19/06/2019 | Kate Dunston

Brexit: Where are we now?

19/06/2019 | Kate Dunston

Brexit: Where are we now?

Strategic Advisor Geoffrey Podger shares his latest thoughts on Brexit and what a no-deal might look like in the food safety and occupational health and safety areas.

I know – on seeing the title of this article you immediately groaned and thought that the last thing you want to read is another article about Brexit. It certainly has dragged on as a process. The last blog I wrote suggested that matters between the UK and EU would not resolve themselves until midnight on March 29, the date at which we were due to leave the EU. When I wrote that I thought I was being pessimistic, but now I realise that I’m really a hopeless optimist.

Our new date for leaving the EU is 31st October, although that could again be extended if both the UK Government and the 27 remaining EU member states wished to do so. On the UK side this is clearly a matter of dispute between the rival candidates to succeed Mrs May as Prime Minister. Moreover, the present House of Commons has yet to agree on a way of leaving the EU, let alone a date for doing so. However, even if the UK wished for a further extension, there are clearly influential voices on the EU 27 side who would wish to see the parting of ways with no further delay, and if necessary, a no-deal Brexit.

The consequences of a no-deal Brexit

If the UK leaves with a deal on 31 October, or there is a further extension, then we should be spared immediate changes which affect business. The urgent question is therefore what will happen if the UK leaves on 31 October without a deal. Clearly much preparation has been done for this on both sides of the Channel and the seven months delay from March should have helped put the building blocks into place even more robustly. The one major problem with the delay however is that the edge may rather have gone off the preparedness arrangements, for example with extra staff brought in as a contingency in March having been returned to their previous duties and the stockpiles of goods bought to ease the transition are being depleted, as they are being put into rather than kept in storage.

We now know quite a lot about what a no-deal Brexit will look like in the food safety and occupational health and safety areas. The good news is that UK law will remain essentially the same in both areas, with only adaptions to reflect the fact that we are no longer part of the EU, thus health and safety rules will remain the same.

Similarly, food safety requirements will not alter on 1st November under this no-deal scenario. However, there are significantly wider implications for business. In particular the UK would become a “third country” in EU terms which means that there would no longer be free flows of goods across borders, without for example, potential liability for tariffs and indeed for customs and particularly phytosanitary inspection where appropriate. Arrangements should be in place to cope with this but there is still the fear of goods vehicles piling up on both sides of the Channel, with adverse consequences for the supply of goods. Moreover, it will not just be the exporters of goods who are affected by tariffs, the UK Government has already announced the tariffs it will require for the first time from EU countries on some imports. These will inevitably call into question the pattern of food imports we have been used to since joining the EU. In some cases, we may well revert to buying products on the world market where we will no longer be subject to the EU’s tariffs to protect its markets from imports – thus oranges from outside the EU for example should be cheaper for us than the present EU imports. The country probably most affected proportionately will be Ireland, whose food imports into Great Britain (not to Northern Ireland) will in some cases attract significant tariffs, with the possibility of a shift in British consumer preference as a result.

Key challenges

There remains a key issue for the food and hospitality industries alike as to what would happen to immigrant staff numbers under any post-EU no-deal regime. All political commentators agree that Mrs May with her previous Home Office experience has been a driving force in reducing the levels of immigration into the UK. With her departure as Prime Minister the same sources identify successor candidates for her post who may be inclined to take a more relaxed view on both temporary and permanent immigrant numbers and a willingness to accept that the UK needs an element of such immigrants for lower paid but vital jobs, such as in the food and hospitality industries. Like so much else this is still “up for grabs” and we still don’t know how it will work out. Given what happened to my last Brexit prediction, I think I’ll refrain from prophesying this time!