Peers warned that while this would not equate to a 22% increase in food costs for consumers, prices paid at the checkout would certainly rise.
The UK Trade Policy Observatory’s modelling predicts price increases of 5.8% for meat, 8.1% for dairy products, 4% for vegetables, 3.1% for fruit, 1.8% for bread and cereals, and 1.5% for fish.
To counteract this, the government could cut tariffs on all food imports, EU and non-EU, but this would pose a serious risk of undermining UK food producers who could not compete on price, according to the report.
Half the UK’s food is imported: 30% comes from the EU, and another 11% comes from non-EU countries under the terms of trade deals negotiated by the EU.
British farmers fear they will lose the £3bn-a-year taxpayer subsidy they enjoy under EU rules.
The National Farmers’ Union (NFU) argues that food procured for Britain’s public sector after Brexit should be sourced from the UK wherever possible, except for products grown elsewhere.
If followed through, the NFU claims the measures would ensure a market of tens of billions of pounds a year to British farming and food production, and would secure millions of jobs.
The Food and Drink Federation (FDF) has responded, with chief executive Ian Wright commenting: “The report from the House of Lords EU Committee highlights how essential it is for government to prioritise the interests of the UK’s flourishing food and drink industry in the Brexit negotiations.
“As the UK’s largest manufacturing sector, food and drink has prospered from frictionless access to European markets for valuable imports and exports. As the report confirms, any increased friction at borders will prove costly for the entire supply chain and cause short-term disruption for businesses, consumers and shoppers. The Committee is right to highlight the urgency of securing continued market access for UK food and drink firms to those countries with which the EU has a free trade agreement, home to one in 10 of our exports.
“The committee’s call for a comprehensive food security policy is encouraging, but as correctly suggested there is still a serious gap between government confidence and industry concerns.
“While the proposed transition period provides businesses with some certainty, it is certainly briefer than we believe would be optimum. Government must keep the readiness of both industry and systems under review. Time is running short and government must offer clarity and realism to businesses on future customs arrangements and the Irish border.”