No-deal Brexit food price hikes and export delays a 'material risk', Gove says

Written by Beckie Smith on 9 September 2019 in News
News

Give gives evidence as reports say he has put troops on standby to prevent fuel shortages

Cabinet Office minister and chancellor of the Ducky of Lancaster Michael Gove, who oversees no-deal planning. Photo: Victoria Jones/PA

The minister in charge of no-deal Brexit planning, Michael Gove, has said there could be in food prices and delays to exports after 31 October if the government fails to strike a withdrawal agreement with the EU.

The Cabinet Office minister told a committee of MPs last week that “in the event of a reasonable worst-case scenario, what we are likely to see is the price of some food commodities rise and the price of some other food commodities fall”.

Gove was criticised earlier this month for saying “there will be no shortages of fresh food” if the UK crashes out of the EU without a deal. The British Retail Consortium has flatly contradicted his comments in a statement, saying it was “categorically untrue” that fresh food supplies would be unaffected. And last week, BRC chief Andrew Opie said 31 October would be “probably the worst time” in the year for retailers to face a no-deal Brexit


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Appearing before the Exiting the European Union Committee, Gove clarified that he had not wanted people to “imagine a situation similar to the one that might occur in a dreadful extreme weather event or after a fuel crisis” in which shelves were empty or choice was greatly reduced for consumers.

However, he conceded that the supply of some foods could be restricted. “A constriction in supply at a given time might lead to prices increasing, but in common parlance ‘scarcity’ sounds as though we are living in a world where we cannot get what we need,” he told the MPs.

However, Gove conceded the autumn timeline presented “specific challenges” ahead of Black Friday and Christmas. “There are flows of certain fresh foods that are greater at that time, just as there is greater pressure on warehousing space,” he added.

He said the government was seeking to mitigate those pressures and that “there is no good time of year to leave the European Union without a deal.”

Gove confirmed that an Operation Yellowhammer document leaked to the Sunday Times last month – which said the UK could face fuel and medicine shortages in a no-deal Brexit – was not, as he previously said, an “old document”, but was dated 2 August. He said some parts of the document, which represented a “reasonable worst-case scenario”, had been prepared in the months before that date.

The cabinet minister said the material was in effect a “handover document” from the previous government, and that the current government “wanted to test” much of the work that it described. “To present it in two ways – as both the considered, definitive position of the new government and also, as some sought to do, as a base-case scenario – would have been wrong,” he added.

Gove’s appearance was followed by a report in the Mail on Sunday that he had put 1,600 soldiers on standby to transport fuel after October 31 to prevent no-deal shortages. The plans to deploy 80 tankers to transport fuel were reportedly presented to the so-called XO committee of ministers preparing for no deal as part of the Ministry of Defence’s contingency planning efforts.

Gove told the committee that extra funding announced by the chancellor, Sajid Javid, had enabled departments to step up their no-deal planning. He said Javid’s predecessor, Philip Hammond, “felt that it would be wrong to spend money and give everyone the impression that no deal was now a principal option… he did not want it to become a self-fulfilling prophecy”.

He said some money had been made available to departments and that the Department for Environment, Food and Rural Affairs, which he was leading at the time, had been given enough funds to prepare. However, the former environment secretary said he had had “other frustrations” with the pre-March 29 deadline preparations, including the decision not to auto-enrol businesses in post-Brexit customs systems.

But Gove revealed there is still significant uncertainty about some elements of the UK’s relationship with the EU in a no-deal scenario, including on data-sharing agreements. He said he was “pretty confident” the EU would grant the UK data adequacy – which would enable data-sharing agreements to continue. “There is a definite risk, however, of a gap after we leave and before we get an adequacy rating,” he said.

And Gove refused to answer repeated questioning about whether there would be enough heat-treated pallets to export food to the EU after Brexit. Opie had told if the French government decides to enforce all new customs arrangements immediately after a no-deal Brexit, a pallet shortage could prevent some exports.

Gove said it was clear that “at the moment” that the French government does plan to enforce all customs regulations, but said that could change as French politicians have “said that they wanted to be as pragmatic as possible”.

Asked whether he agreed with an assessment by former border planning chief Karen Wheeler – who also appeared before the committee last week – that export delays would happen even in a best-case scenario, Gove said: “I don’t think they are inevitable, but they are a material risk.”

He confirmed that the HMRC estimate Wheeler gave to the committee that 20% of the 10,000 trucks a day that export via Dover would not have the correct documentation was correct as of June, but may since have been updated.

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Beckie Smith
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Beckie Smith is a reporter for CSW who tweets @Beckie__Smith

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