finance

Call for six month's grace for food and drink



Scotland’s food and drink industry has pleaded with the Prime Minister to grant a six-month “grace period” for new rules coming into effect when the UK’s Brexit transition period ends on 31 December.

Business leaders said in a letter to Boris Johnson that after the damage done by coronavirus they are now facing a “perilous situation” at the end of the year.

With no deal on future trading terms yet agreed between the UK and EU, the group warned  Johnson the “fallout from a no-deal would be catastrophic”.

Scotland’s food and drink industry is worth £15bn a year, employing 120,000 people across the country.

Industry leaders said the impact of Covid-19 has been “devastating”, with the sector fearing losses in revenue of £3bn.

Now with the end of the Brexit transition period looming in less than two months, the group said it wants a six-month relaxation of the rules that will require those selling products to Europe to produce export health certificates and other certificates.

The letter to the Prime Minister has been signed by Scotland Food and Drink chief executive James Withers,  Food and Drink Federation Scotland chief executive David Thomson, and Scott Walker, who holds the same position with the National Famers’ Union Scotland.

Senior figures from groups including Quality Meat Scotland, Seafood Scotland, the Scottish Wholesale Association and the Scottish Salmon Producers Association have also put their names to it.

They all argue that negotiating a six-month grace period must now be a “top priority” for the UK Government to help businesses adjust to the new rules.

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The letter states while this “was ultimately what the transition period was meant to do” there are still a “number of unanswered questions around trading arrangements after 31 December”.

It says: “A six-month grace period would enable businesses to trade with the new rules but without fear of significant border disruption, enforcement action and loss of further revenue.

“Most critically for Scotland is the need for a six-month derogation from the requirement to produce export health certificates (EHCs) and other export certification including haulage permits.

“To be clear, there is no system available that can cope with the increased demand in EHCs likely to be required from 1 January.”

Johnson has been urged to “bring forward a package of financial compensation for producers, processors, manufacturers and distributors who encounter loses as a direct result of border or market disruption”.

The group suggested this should last for an initial period of three months but could be reviewed afterwards.

It also wants the UK Government to “finalise operational arrangements for enabling the smooth passage for seafood consignments across the Channel”, which is vital for the Scottish seafood sector to sell its products to Europe.

The letter tells the Prime Minister: “With less than 60 days until the UK enters into new historic trading arrangements, time is not on our side and there is an enormous task that lies ahead to get businesses ready and support them through the coming months.

“We are sure you do not underestimate the scale of this challenge and the unique combination of concerns facing our sector, the businesses within it and the people whose livelihoods depend upon it.

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“It is vital that the UK Government stands ready and willing to support our industry in the months ahead and we urge your Government to agree to the measures we have articulated above.”

A UK Government spokesman said: “British food and drink is some of the best in the world, and leaving the EU means we can take advantage of the growing global demand for great British produce.

“We are making significant preparations to prepare for the guaranteed changes at the end of the transition period – including investing £705m to ensure the right border infrastructure, staffing and technology is in place, providing £84m in grants to boost the customs intermediaries sector, and implementing border controls in stages so traders have sufficient time to prepare.

“With less than two months to go, it’s vital that businesses and citizens prepare too.

“That’s why we’re intensifying our engagement with businesses and running a major public information campaign so they know exactly what they need to do to grasp the new opportunities available as the transition period ends.”



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