Majority of food and drink firms feel unprepared for Brexit, study finds

Almost three-quarters of Scotland’s food and drink businesses feel unprepared for Brexit and any resulting disruption, according to research.

Scotland Food and Drink said with a month to go until the transition period ends, the industry feels it is in a “perilous position”.

The industry body has written to Prime Minister Boris Johnson seeking urgent action and assurances around trading arrangements once the transition period ends on December 31.

With many of the new trading rules still unknown, coupled with businesses fighting to survive the impact of the pandemic, the industry has called for a six-month grace period to adjust to whatever the new trading rules are – in particular on the requirement to issue millions of new export certificates for food products.

Industry leaders will meet Victoria Prentice, a minister in the UK Department for Environment, Food and Rural Affairs, on Tuesday to discuss the issues.

James Withers, chief executive of Scotland Food and Drink, said: “With only one month to go until the end of transition, Scotland’s food and drink industry finds itself in a perilous position.

“Without the reassurances we have asked for, particularly the six-month grace period on export paperwork, there is huge concern among our members and the wider industry that the impact of Brexit could cost millions and tip many businesses over the edge.

“In reality, the Brexit transition period hasn’t actually happened. Businesses have had to focus on surviving the Covid-19 pandemic and, with one month to go, we still don’t know what exactly we’re preparing for. Is it a deal or no-deal?

“Even without the added financial and logistical pressures of coronavirus, preparing for a completely unknown set of trading regulations and the biggest trading upheaval of a generation is a hugely challenging ask.

“At a time when our industry is still struggling with the £3 billion hit of coronavirus, we now risk putting businesses to the wall by not providing time to implement the new regulations.

“It is unacceptable and entirely avoidable.”

The poll of 170 Scotland Food and Drink members found 72% feel unprepared for Brexit.

The body said the EU is the destination for 70% of Scotland’s food exports and the largest market for Scotch whisky.

It has made a number of other requests to the UK Government, including for a commitment to bring forward a package of financial compensation for producers, processors, manufacturers and distributors who encounter losses due to border or market disruption.

It has also asked ministers to finalise arrangements to ensure a smooth passage for seafood consignments across the Channel, and to add food and drink sector roles to the Scottish Shortage Occupation List.

A UK Government spokesman said:  “The UK Government is working closely with the devolved administration in Scotland and taking steps to ensure we are ready for the end of the Brexit transition period, regardless of the outcome of trade negotiations.

“We are investing £705 million in jobs, technology and infrastructure at the border, and providing £84 million in grants to support the customs industry.

“With just a month to go, everyone must take action now to prepare, so we are intensifying our engagement with industry through the Brexit Business Taskforce and our public information campaign.”