Failure to seal EU free trade deal will mean higher UK food prices, say peers

Shoppers face a significant rise in food prices if the government fails to secure a free trade deal with the European Union, peers have warned.

In a bleak assessment of the impact of Brexit, the Lords EU energy and environment subcommittee suggested grocery costs would rise, businesses could go bust and year-round supplies be put at risk.

The price of beef could rise by between 5% and 29%, while cheddar cheese could soar by nearly a third and broccoli by 10%, according to evidence from the British Retail Consortium to the committee’s inquiry.

The UK Trade Policy Observatory, meanwhile, predicted price increases of 5.8% for meat, 8.1% for dairy products and 4% for vegetables.

Peers concluded that shoppers could be left in a two-tier system that means the better off buy more expensive, British goods while those who are poorer are left with lower-standard cheap imports.

The committee chairman, Lord Teverson, said: “Throughout our inquiry there was a striking contrast between government confidence and industry concerns. The government has some important choices to make.”

The report suggested UK ports would be choked up with delays if EU food imports are subject to the same border checks as other imported produce. Allowing them through with few checks would raise safety concerns, it added.

Peers said it was “inconceivable” that Brexit would have no impact on EU food imports to the UK, whatever the structure of a deal.

The report found that if no agreement was negotiated, Brexit was likely to result in an average tariff on food imports of 22%.

“While this would not equate to a 22% increase in food prices for consumers, there can be no doubt that prices paid at the checkout would rise.

“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.”

The committee found that it would not be possible to increase food production in time to meet any shortfall caused by Brexit.

Half the UK’s food is imported, with 30% from from the EU, 11% from countries with EU trade deals and the rest from other foreign sources.