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Brexit: implications for food, farming & ethics

28/06/16
Dr James Northen

Dr James Northen looks at the implications of Brexit for UK farming, food and ethics.

Brexit: implications for food, farming & ethics

 

There are many big, unanswered questions about the future of the UK outside the European club, not least the prospects for future economic growth, employment and prosperity.

Importance of the EU for farming and food

The vote to leave the EU will profoundly affect the UK’s farming and food industry, because the European project has always had at its heart the mission to ensure sufficient, safe and consistent supplies of food for its member countries. The Common Agricultural Policy and Common Fisheries Policy have been crucial to this mission; as evidenced by the 40% of the EU budget currently spent to influence the production decisions and environmental protection efforts of the EU’s farmers and fishermen.

The UK is a net importer of food, feed and drink (FFD) with the value of these imports double that of exports and a current £20.5bn FFD trade deficit.  EU countries have always been our most significant trading partners accounting for over half of the UK’s FFD exports and imports. Huge uncertainty following the referendum vote has already destabilised financial and currency markets.  A pound that has plunged in value against international currencies will make major FFD imports more expensive, particularly fresh fruit and vegetables, poultry, beef and wine.  Scotch whisky and salmon will benefit from the weaker pound given their strong exports, but this is cold comfort for the majority of Scots wanting to stay in the EU. 

Importance of the EU and Brexit for food ethics

A major EU focus over the last four decades has been animal welfare and environmental protection.  Animal welfare advances driven by the EU have included: banning conventional cages for laying hens and animal testing for cosmetics; improving animal transport conditions; and recognising animals as sentient beings. Environmental protection measures have included: reducing air and noise pollution; protecting nature and biodiversity; managing and reducing waste; and tackling climate change. The current EU circular economy package is the latest of the many measures designed to raise standards and ensure a level playing field, in this case, in eco-design, waste prevention and the re-use and recycling of products. 

The relationship the UK negotiates with the EU after Brexit will determine the specifics of how existing EU laws are treated within an independent UK. EU legislation typically comes in the form of either a Regulation or Directive. EU Regulations do not require national legislation and so, post-Brexit, will have no standing in the UK. Likewise, EU Directives implemented through secondary legislation (Statutory Instruments) will no longer have an effect unless the UK Parliament introduces the necessary national legislation. 

However, companies wishing to export to the EU will still have to comply with EU requirements.  In the short-term, as the UK may not have in place equivalent national regulations, European traders may look elsewhere for their goods.

In contrast, EU Directives implemented through primary legislation (Acts of Parliament) will remain in place until, like any other Act, they are repealed or superseded. 

To start formal divorce proceedings, the UK must invoke Article 50 of the Lisbon Treaty. Once invoked the UK has up to two years to negotiate its exit and future relationship with the EU block. Importantly, unless there is a unanimous consent by other EU member states to extend, after the two years is up the UK will be obliged to trade under the terms of the World Trade Organisation. 

This is generally considered to be the least favourable outcome, not least because the EU block would be obliged to impose its Common External Tariff on goods flowing from the UK, which would impact the food sector, hitting confectionery and dairy exports, to name just two.

What Brexit means for food ethics in the UK

The EU’s focus on ethical challenges (animal welfare, environmental protection, social justice and fair competition and trading) is, in part, because of the failure of markets to provide necessary protection. Regulation in these areas will therefore continue to be needed and the UK government must invest significant time reviewing, negotiating and managing its way through the relevant legislation to arrive at suitable policy and legal positions for the newly independent UK.  

The UK government has often been accused of gold-plating EU Directives in domestic legislation and in doing so creating an uneven playing field for UK industry. During the forthcoming Brexit divorce, companies and trade associations may lobby for lighter regulation, particularly where risks to continued international trade are low. 

On the other hand, NGOs may see an opportunity to tighten up perceived weaknesses in the regulatory framework.  Just one example of a likely battle ground will be genetically modified organisms, with the tension between those wanting the UK to have greater flexibility to grow GMO crops than allowed under EU rules, versus those who support the EU’s precautionary principle in dealing with new technologies. 

Implications of Brexit for UK Government

For the last four decades UK trade deals have been part of the wider EU trade negotiations.  The UK has therefore not needed many trade negotiators and now finds itself with just a handful of experienced people. It will need to find hundreds more, both to negotiate the terms of Brexit with the EU block and to negotiate bilateral trade deals with other countries globally. 

The British Civil Service also has the unenviable task of reviewing existing EU-created legislation and determining if it should be kept, amended or shelved. It must do this with significantly diminished manpower and expertise and the question remains whether the Civil Service has the capacity and capability to perform this role effectively and within a reasonable time frame.

The legislative review will take up huge amounts of Parliamentary time and there are bound to be knock-on consequences for the incumbent Government in terms of pushing through other manifesto commitments and necessary legislative changes. 

Conclusion

All of this points to the need for the UK’s food industry, trade associations, NGOs and Government to work together to quickly find reasonable positions that continue to advance the ethical dimensions of food production, trade and consumption, whilst not disadvantaging the UK vis-à-vis our competitors. This will be a huge challenge, but is essential to ensure the UK remains at the vanguard of ethical farming and food systems.

Sources: Eversheds; The Economist Group, IGD, Defra, European Commission  

James is currently working with the Food Ethics Council on a pro-bono basis. He has worked in the food and grocery sector for 20 years, the last 14 at IGD where, until March, he was Director of Industry Programmes.  He has a PhD in food industry economics.  He can be contacted at Jamesnorthen20@gmail.com

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