British agriculture must now think the unthinkable

By Pete North - February 23, 2021

Some issues food exporters are facing can no doubt be sorted out over time but with things being as they are politically, British firms shouldn’t hold their breath. We can smooth over customs headaches but regulatory hurdles are here to stay. British food exports will struggle to remain competitive. A natural consequence of leaving the single market.

Though this proves economically difficult for those exporting to the EU, it’s also proving politically contentious for Northern Ireland. Though we see vague proclamations to work toward solutions, it’s difficult to see what can be done without a more comprehensive agreement between the UK and the EU.

On this, some suggest the UK aligns with the EU SPS regime and adopts a Swiss style common veterinary area. As far as agri-food products go, this would certainly give us the “invisible border” that UK exporters would prefer. The UK would have to maintain the full spectrum of internal checks, and paperwork, applying EU law to its fullest extent.

As to whether this would be politically tenable in the UK remains to be seen but it would quite obviously contradict any claim to us having regained control over our laws, particularly if the EU insisted on a role for the ECJ.

That reality makes it a non-option for the foreseeable future. A government that has just reappointed David Frost to manage our trade relationship is not about to hand back a major area of national sovereignty having made a big show of taking it back. A more comprehensive SPS agreement may be possible, reiterating the central role of Codex and other global standards, but if exporters were hoping for anything more, they’ll have a long wait.

The reality is that exporters are going to have to get used to how things are and expect only marginal improvements. The single market business model is dead and the sector must adapt. For as long as the Tories are in office, exports to the EU are a non-starter.

This is where the food industry needs to get its skates on. Presently parliament is listening to the usual suspects on trade, floating the same tired mantras about alignment and mutual recognition but it won’t get them anywhere. The industry should stop trying to put the genie back in the bottle and look at how to restructure the industry.

One of the more shameful things to happen to the meat industry while in the EU was the obliteration of local slaughterhouses in favour of enormous mechanised death sheds in order to comply with EU design specifications. Those who could not afford to comply (often requiring millions in investment) were slapped with throughput restrictions, putting an end to businesses that had run for generations.

This is where the meat industry can capitalise on the zeitgeist. There is already a clear argument for reducing food miles, and the smarter players are already selling direct to the consumer through online retail. Meanwhile they need their own lobbyists working Westminster. It looks like the EU is going to work to rule to exclude UK produce. We should look to return the favour. It’s not ideal but we’re back in the trade politics game.

If we take the view that EU exports are a non-starter, we might as well go the whole hog with deregulation. Generally the industry is opposed to the concept of deregulation being that further divergence makes exporting to the EU more difficult, but since that’s becoming impossible anyway, it’s something of a moot point. Why bother with the compliance overheads when you’re not exporting to the EU?

That is to say that standards are then lowered. It’s less a matter of deregulation as re-regulation. Rethinking regulation to produce more localised foods, eliminating the bureaucracy in the process (ie useless veterinary inspections), could spell a return to the highest possible quality. Divergence is only “lowering standards” if you buy into the remainer mythology that EU rules (largely the product of corporate lobbyists) represent the gold standard.

Though UK exports can’t compete on price even when in the EU, we certainly can trade on national prestige and quality. But then we’re also going to have to completely rethink our relationship with food.

Though I campaigned to stay in the EEA, there are certain aspects of it I’m not sorry to see go. Importing off-season goods from Spanish greenhouses all year round doesn’t sit right with me – particularly when the entire sector is based on low wage exploitation, as is the haulage industry that brings it here. Similarly we are told that fruit will rot on the trees without armies of immigrants to pick it. There is no reason whatsoever why this production cannot be re-shored and no reason why fruit picking cannot be done by agribots.

If that then means investing in the technology, and paying decent wages, then I can live with that. So maybe food becomes a bit more expensive. But what if it’s not supposed to be cheap? What if we’re supposed to respect our food? What if the maximum availability of cheap convenience foods is killing us and draining our wallets even more?

Over the last few years I’ve yet an eye on emerging agricultural technologies. The hydraulic tree shakers are impressive as are the strawberry picking drones. Fish husbandry and aquaculture technologies are also far further along than I ever imagined. The UK should be pioneering them, exporting them and setting the standards.

A common theme since WW2 in Britain is that if industry is presented with a choice between cheap immigrant labour or investing in technologies then it will always choose the former. It didn’t work for Bradford textiles and it isn’t a long term answer for British agriculture. Also, hiring foreign vets to do menial meat inspection work is a complete waste of training and ability.

Whether we like it or not, we are going to have to evolve out of the single market mentality and reshape our regulation according to our societal objectives rather than pegging our hopes on reviving EU exports. Once those supply chains are broken, a new harmonisation agreement is unlikely to restore them.

When it comes to food I’m not a free trader. Agriculture and husbandry of the countryside is central to our way of life, and things like animal welfare, food miles, and sustainability should matter more than they presently do. For all the EU’s climate dogma, and level playing field pretensions, the system is still one that favours corporate scale producers whose margins are contingent on keeping wages low.

One also wonders what Covid will do to consumption trends. Have we any need of banks of Esso garage sandwiches if the ambition is to eliminate pointless commutes? It seems to me that the combination of Brexit and Covid presents us with a number of opportunities to rethink how we live and to rethink how and what we eat, and free of the dead hand of Brussels regulation, we are truly free to innovate.

Remainers scoff that Brexit (in part because of Brussels “red tape”) means more red tape for business – but that’s only if you’re exporting. If you’re not exporting then there’s certainly scope to streamline regulatory requirements without impacting on standards. That industry is not calling for deregulation is largely because it is represented by deadbeat legacy outfits like the NFU and CBI who haven’t the imagination to envisage doing things any other way. They are too used to being rule takers rather than fighting for their members.

As regards to the Northern Ireland situation, the UK aligning once more with the EU SPS regime would be a squandered opportunity to do things a better way. If the Northern Ireland protocol can be fixed to accommodate British sovereingty (in the spirit of partnership) then great, but if not if will have to be phased out. It would be unfair to leave Northern Ireland behind to be poisoned with Polish salmonella chickens and we cannot allow the EU to use Northern Ireland as a backdoor for its low quality produce.

The EU’s refusal to address its administrative exclusion of bivalve molluscs tells us all we need to know about future trade with Europe. There are no reasonable grounds for the exclusion and Brussels has apparently not yet realised its error. We have to assume this is the model for the future and assume exporting to the EU isn’t viable. That may not be optimal, but the sooner we accept this as a given, the sooner we can get on with the necessary reforms to secure the future of British food producers. If we keep looking back, expecting the EU to cooperate, we will waste valuable time.