Brexit trade agreement ‘unworkable’ for UK supermarkets, MPs told

Retailers and suppliers battling through ‘impenetrable’ red tape that has resulted in empty shelves in Northern Ireland

The Brexit trade agreement is “pretty much unworkable” for UK supermarkets, MPs have been told, as problems mount in the nation’s food supply chains and gaps appear in fresh produce aisles.

Boris Johnson’s Christmas Eve deal with the EU gave retailers and suppliers just hours to prepare for the final set of rules which were made public on 31 December.

That has left supermarkets scrambling to deal with mountains of “impenetrable” administration. In some cases the time taken to complete paperwork on a lorry load of goods bound for the EU has increased from three hours to five days, the House of Commons Brexit committee heard.

Andrew Opie, director of the British Retail Consortium (BRC), was scathing of the government’s last-minute delivery of the deal, which he said had resulted on shortages on supermarket shelves in Northern Ireland.

“Northern Ireland is a particular problem, there’s no doubt about that, and a particular problem for UK supermarkets,” Mr Opie told the committee.

“We did not get the final confirmation for how product could move until 31 December for a 1 January start.

“The inevitable consequence of that was that both retailers and suppliers who supply directly to Northern Ireland took a relatively cautious approach to the borders and therefore some products had more of a problem, were held back… until retailers and some manufacturers got to grips with the system.”

All of the major supermarkets wrote to Michael Gove, the Cabinet Office minister, this week calling for urgent solution to how goods move between Great Britain and Northern Ireland.

Retailers warned that problems could deepen on 1 April when a temporary easing of border checks will end.

The UK has agreed two grace periods with the EU. One exempts supermarkets and their “trusted suppliers” exporting products of animal origin to Northern Ireland from completing Export Health Certificates.  

The second allows fresh processed meat products like mince and sausages, which cannot be exported into the EU, to be exported to Northern Ireland.

If a workable solution to border checks for retailers is not found by 1 April, consumers and businesses in Northern Ireland will face “significant disruption”, Mr Opie told MPs.

Exporters are also experiencing problems certifying food going into the EU.

“We have consistently said that the system of import and export for food as it stands is not set up for a just-in-time delivery,” Mr Opie said.

While a shipment of lamb from New Zealand might require just two or three certificates, a supermarket lorry travelling from Great Britain to the Republic of Ireland would typically contain 100 or more different products, each of which requires a separate certificate to be filed 24 hours before arrival.

“The way supermarket supply chains work is that stores send information back to the depots on a daily if not hourly basis saying ‘we are running out of these products’.  

“Those lorries are generally moving well before the 24-hour period. They don’t know what needs to be in the lorry and yet they are expected to tell the authorities what is going to be on the lorry. 

“They also need an exhaustive process of certification and bureaucracy, including vets to sign off all the products going to the Republic of Ireland or the rest of the EU.

“It’s pretty much an unworkable system for supermarkets.”

Ian Wright, director of the Food & Drink Federation, said suppliers remained “clueless” about some of the practical implications of the trade deal.

“The biggest problem was that the deal was agreed very, very late,” Mr Wright told the committee. 

“All members of the food supply chain have had very little time to get to grips with the provisions of the agreement and are still getting to grips with them.”

He added: “The enforcers are as clueless about some of the provisions of parts of the deal as those operating under it.

“Nobody has had the chance to work with this deal, to rehearse how to do checks.”

He cited one multinational company that found customs checks and certifications on a mixed consignment of goods to the EU would previously have taken three hours to complete now takes five days.

“Such is the nature of the impenetrability of the paperwork.

“The settlement itself, particularly on rules of origin, is not as generous as we might have hoped and is therefore replete with difficulties hidden away within the documentation that are still being assessed.”

Mr Wright continued: “We weren’t ready but we could not have been ready because nobody knew what the deal said until almost the moment that it was implemented.

“We now have to treat every different bit of a consignment, every different product, with the same approach that we might have previously done to whole lorry loads.

“What’s going to end up happening here, I think, is that unless the deal changes in some material way we are going to see the re-engineering of almost all of the GB-EU and GB-NI supply chains over the next six to nine months.”

A UK Government spokesperson said:  “A new dedicated team in government has already been set up and will be working with supermarkets, the food industry and the Northern Ireland Executive to develop ways to streamline the movement of goods in accordance with the Protocol.  

“The grace period for supermarkets and their suppliers is working well, goods continue to flow effectively between Great Britain and Northern Ireland and we are working intensively with industry as new requirements come in.”