Don’t Leave British Dairy Behind in Brexit Negotiations, Urge Arla

04 Apr 2017 --- As part of Brexit negotiations, the UK government’s Great Repeal Bill will end the supremacy of EU law in Britain, an aspect at the very core of the UK’s motivation for leaving the EU.

The Government released a White Paper for the bill last week which temporarily gives powers to ministers to amend thousands of laws as the UK prepares to leave the European Union.
As Prime Minister Theresa May prepares negotiations on vital issues like trade deals, the free movement of people and customs issues, the food and drinks industry at large is waiting with bated breath to learn more detail about what that actually means in real terms. 

Meanwhile several organizations are urging the government to protect various sectors - including agriculture, dairy and retail - while others are calling for Britain to examine its food safety policies to ensure that as the UK leaves Europe, standards do not drop. 

One group is the alliance for better food and farming, Sustain, which says taking back control means that Britain “should keep sensible standards that are already in place, and work to make them even better when we leave Europe.”

“We don’t believe that strong standards that help to ensure the food we eat is safe, sustainable, ethical and healthy should be put at risk by Brexit,” a statement says.

“This would be a bad result. The Great Repeal Bill and other Brexit measures must secure important existing food standards, to avoid outcomes such as: meat being poorly checked for disease or contamination, pesticides currently banned being used on our fruit and vegetables, treasured nature and wildlife being harmed by damaging farming practices, unproven health and provenance claims appearing on food labels, precious fish stocks becoming endangered through over-fishing.”

Meanwhile, Arla Foods and its farmer owners are urging the UK government to protect the future of the dairy sector or risk “undermining” a key sector of the country’s economy. 

Drawing on findings from a recent economic impact assessment carried out by independent economics consultancy Centre for Economics and Business Research (Cebr), Arla is warning that the contribution made by its business and farmer owners to the UK economy would come under severe pressure if Brexit negotiations lead to significant restrictions on free trade and quotas.

According to the report, Arla’s total economic footprint in the UK is valued at more than £6 billion (US$7.4 billion) in Gross Value Added (GVA). This is equivalent to 0.52% of the entire UK business economy and 0.33% of UK GDP, it says.

The reports also says the combined businesses of Arla and its farmer owners directly supports more than 50,000 jobs in the UK and can be indirectly associated with more than 119,000 jobs in total.

Like many businesses, Arla and its farmer owners rely on free trade, particularly when it comes to exporting – in 2016, Arla exported to 21 countries within the EU and 48 outside the EU. In addition, the UK also imports a number of popular Arla products from elsewhere in the EU.

“Our business and our farmer owners make a major contribution to the UK economy, playing a key role in the UK food and farming sector, which is estimated to be worth over £100 billion (US$124.4 billion),” says Tomas Pietrangeli, Managing Director of Arla Foods UK.

“While it’s true that Brexit will bring opportunities that we are ready to embrace, ending tariff-free trade should be seen as a major risk. We need assurances that the transitional arrangements we are likely to require before a free trade agreement between the UK and the EU is agreed are tariff- and barrier-free. To do otherwise will be detrimental not only to us but to many other organizations.”

“That’s why we’re calling on Government to protect the health of the British dairy industry and its broader benefits to the wider UK economy and, in doing so, ensuring agriculture and food and drink production are front and center of its negotiation efforts.”

Oliver Hogan, director at Cebr and principal author of the report, adds how Arla is deeply embedded in the British economy. 

“The true extent of Arla’s economic ‘footprint’ in the UK cannot be underestimated. It’s a business that is deeply embedded in the British economy, not only through its farmer owners and core dairy business, but also through a large and wide-ranging domestic supply chain and through its downstream links with the distributive trades (retail and wholesale),” he says.