Fruit & vegetable prices could further increase because of upcoming post-Brexit border checks, traders have warned.
The Fresh Produce Consortium said many in the fresh produce supply chain feared they would not be able to absorb the extra costs that are set to come with the UK’s new imports strategy, which will begin to roll out in October this year.
The Grocer has previously reported businesses are expected to foot the bill for an array of new post-Brexit border requirements as part of its proposed Border Target Operating Model – including health certificates and customs paperwork, as well as a proposed levy that is meant to help fund new border control points.
The FPC has estimated that the levy – known as the Common User Charge, a flat fee of up to £43 on every consignment eligible for physical checks at the Port of Dover and Eurotunnel border points – will cost the fresh produce industry up to £11m a year.
It said this “unfair tax” was particularly worrying for small and medium-sized businesses already struggling to absorb rising costs in the current inflationary landscape.
The consortium, which represents around 70% of the UK’s fresh produce supply chain, has now asked members to get in touch with their local MPs to make them aware of the “significant impact” of the government’s proposed common user charge.
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“FPC is advising its members to contact their local MP to make them aware of the significant impact these proposals are likely to have on food security and inflation, plus the significant cost and disruption this is likely to cause fresh produce businesses and their customers,” the trade body told members in a letter.
The warning comes as Defra has opened a consultation period on the proposed common user charge earlier this month to gather feedback from the industry before announcing a final decision in July. If greenlit, the fees are likely to start from April 2024.
“The UK Border Strategy will be directly responsible for fuelling food inflation,” said FPC CEO Nigel Jenney. ”These are costs that we simply cannot absorb as a sector, and these are costs being imposed by government, no one else.”
The group also wrote to ministers to warn the coming red tape would fuel food inflation as businesses would be forced to pass on those costs to consumers.
It argued the Border Target Operating Model was “an outdated and highly inefficient border solution which fails to meet the needs of a modern progressive industry and simply adds cost for consumers”.
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In addition to physical checks, the government’s post-Brexit strategy will also require most medium and high-risk goods, such as meat, dairy and plant-origin products, to carry new export health certificates and customs paperwork.
The requirements will roll out in phases, with the first round starting in October this year. But final details on category specification and what exactly the checks will look like for those operating groupage models are still to be released.
The FPC is concerned the government is “only allowing several weeks at best for industry to interpret and implement complex new border processes”, which it says will result not only in price increases but also delivery delays, food waste and shortages at supermarket level.
There is also a ”key concern that additional administrative requirements may restrict or deter European trade”, it said.
The final border strategy is expected to be published in the coming weeks.
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