With the EU referendum looming, food and drink producers, like many other business owners, will be weighing up the arguments for and against EU membership. But what’s the stance of the main food and drink industry bodies?
On a national level, the Food and Drink Federation came out in support of remaining in the Union, back in March – with the key reasons cited being access to the single market, access to raw materials and free movement of labour. The same stance has been taken by FoodDrinkEurope (FDF’s European counterpart) who again focused on uncertainty: “…the uncertainty that would result from a decision to leave the EU would be bad for the UK, bad for Europe and bad for business.”
Notably, the NFU have at national level decided that “on the balance of existing evidence available…, the interests of farmers are best served by our continuing membership of the European Union.” At a recent event hosted by our rural team, the keynote speaker Minette Batters, Deputy President of the NFU, explained in brief the reason for the decision but was very keen to explain that the NFU had only taken this decision because they were forced by the electoral commission to take a stance and they were aware that at local level this may not be a popular decision!
What is certain is that the EU is the UK’s biggest export market. UKTI give figures of total UK food and drink exports of £12.3 billion, of which approximately £9 billion is trade with EU countries. If there is a vote in favour of Brexit (and the government do decide to follow the result of the referendum), this substantial export trade is likely to be affected. Unless and until a replacement trade agreement is negotiated, the UK would cease to benefit from the existing “best friends” access to the remaining member states and there would no longer be free circulation of goods within the single market, resulting in higher costs of imports and exports. For those of our clients involved in export this is a key issue.
Arguably the food manufacture sector would be the hardest hit of UK manufacturing sectors, should free movement of labour be effected – over 25% of the workforce within the sector are from EU countries, as opposed to 7% of the overall workforce.
On a local level, and for smaller and artisan producers, commentators have suggested that there could be benefits to Brexit (at least in the short term) due to the fact that locally produced products are likely to become more competitive in the local market, and this would of course be good news for a number of producers in the sector.
And it is not just small local businesses that have publicly supported a vote in favour of a split from the EU. Most notably JD Wetherspoons has recently come out in support of exit – it being widely reported that the giant pub company has printed 200,000 beer mats listing some of the arguments for the UK to leave the EU. Something to think about whilst supping a pint in any of its 900+ outlets! Whichever side of the argument you fall down on, the uncertainty does seem to be causing the people we speak to the biggest headache!
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