“Too little, too late” to help logistics businesses, says industry body

Logistics UK has reacted with disappointment to the announcement on the intended charging structure for imported products of animal origin from the EU, such as fresh food, which is to be imposed as part of the government’s post-Brexit Border Target Operating Model.

“Logistics businesses have been pressing government for detail on the level of charges and how and when they will be implemented on imported goods since the Brexit vote,” says Nichola Mallon, Head of Trade at business group Logistics UK, which represents the whole sector. “With only 27 days to go until these new checks and charges are to be applied, the cumulative cost facing businesses, and details of the compliance regime that will underpin it, are still not clear.

“The charges to be imposed on imported goods – £29 for loads of medium and high-risk products of animal origin, such as foodstuffs, and £10 for low-risk products – at government-run Border Control Posts will have a significant impact on the cost of doing business with the EU. While a cap on the maximum charge for any one consignment recognises the administrative complexity facing groupage operators, these charges will hit them and SMEs hardest.

“These charges, as well as all the other inspection fees to be charged by the Animal and Plant Health Agency, Port Health Authorities and Local Authorities, and the charges that will be set at commercially-run Border Control Posts, will need to be paid somewhere in the supply chain,” she continues. “Logistics businesses already run on extremely narrow margins and cannot simply absorb these additional costs, so it seems likely that they will have to be passed on to customers in the form of higher prices.”

According to Ms Mallon, logistics businesses have been making their feelings known to government about the proposed border charges for some time, but their opinions have been overlooked.

“81% of businesses that responded to the government’s own consultation on its proposed charging structure at the border made it clear that these charges will have a fairly or extremely negative impact on their business.  Today’s announcement makes it very clear that the government isn’t listening to those who make sure our shelves are stocked and at the lowest possible prices. As a sector we reiterate our call on the government to publish the modelling behind its assertion that the impact on food inflation will be 0.2% over three years: we believe the reality will be very different.”