NO-DEAL BREXIT WILL RAISE COST OF UK HOUSEHOLD STAPLES, SAY RETAILERS

The Guardian 10 July 2020 - by Lisa O'Carroll, Brexit correspondent

© Provided by The Guardian Photograph: Kumar Sriskandan/Alamy

The cost of household staples, ranging from meat and cheese to school uniforms and drinking glasses, will substantially increase if there is no Brexit trade deal, British retailers have warned.

With just six months to go before the UK leaves the EU entirely by exiting the single market and the European customs union, retailers fear further damage to a sector already reeling from the coronavirus crisis, with 5,600 job losses announced on Thursday from Boots and John Lewis alone.

In a report on the prospect of a no-deal Brexit, the British Retail Consortium (BRC) said the public should be aware that no deal will mean a hike in the prices of not just luxury goods but “ordinary household goods that every consumer has to buy and replenish”.

“It’s not foie gras that we’re talking about, it’s mince, it’s cheese, it’s oranges, you know,” said Aodhán Connolly, the director of the Northern Ireland Retail Consortium in a Brexit press briefing.

© PA Wire/PA Images A staff member works behind a protective screen on the cheese counter in the foodhall in Selfridges, London, following the introduction of measures to bring England out of lockdown. (Photo by Kirsty O'Connor/PA Images via Getty Images)“It doesn’t matter whether it’s Great Britain, or it’s Northern Ireland, the people who will suffer most because of these cost rises will be those people who are most economically vulnerable.”

The BRC has calculated that beef, which is imported in huge quantities from the Republic of Ireland, will go up in price by 48%, with cheddar cheese, another staple imported from across the Irish Sea, expected to cost 57% more.

Oranges from Spain will cost 12% more, while the price of cucumbers will rise by 16%. Trousers imported from Italy will have a 12% levy slapped on them , porcelain kitchenware will also go up by 12% and drinking glasses made in Poland up 10%.

Connolly said it was a misunderstanding to think that retailers and their suppliers had built up “huge Brexit war chests” and added that Covid-19 had exposed the fragility of the supply chain.

“The ability and bandwidth, both financially and time-wise, of retailers to deal with a no-deal Brexit at the end of this year has been greatly diminished,” he said.

About half of all food consumed from restaurants or shops comes from the EU, with 30% of produce in supermarkets from the bloc.

Trade deal talks continued this week in London, with the second face-to-face meeting between negotiators Michel Barnier and David Frost. Little was said to suggest that progress had been made and public pronouncements last week suggested they were a long way from a deal.

Deal or no deal, the UK is facing a new trading regime from 1 January as the country exits the single market and the customs union, forcing customs and food health checks on goods entering the country.

“That is going to increase a level of friction that we haven’t seen since 1972,” said the BRC trade expert William Bain.