Scottish Fish Traders Say Brexit Is Costing Them Over £1m A Day And Want The Government To Pay Them Back
The government is being urged to compensate businesses whose exports to the European Union have been torpedoed by post-Brexit paperwork.
One major trade association told PoliticsHome that the Scottish seafood sector alone was losing over one million pounds a day.
Prime Minister Boris Johnson hailed the trade deal struck by the UK and EU last month as a victory for the British fishing industry. The treaty removed tariffs on a range of goods and will see the EU share of fish caught in British waters reduced by a quarter over five-and-a-half years.
However, since the Brexit transition period ended on December 31, fishermen exporting to EU customers have had to complete time-consuming new customs and health paperwork, which is creating delays and leading to orders being cancelled just two weeks into the new arrangements.
Fishermen in Scotland are feeling the brunt of the new friction, with fish and shellfish exports like salmon, oysters, and langoustines not reaching customers on the continent on time, or at all.
James Withers, head of Scotland Food & Drink, estimated that Scottish seafood exporters to the EU “could be losing upwards of one million pounds in sales a day” as a result of the disruption.
When the UK was in the EU’s single market and customs union, fish caught in Scotland would reach shops in France, Belgium, and Spain a day after being harvested. But that speedy supply-chain has ground to a halt in the New Year, Withers said, with EU customers cancelling orders due to delays and hauliers refusing to take multi-product loads to Europe, to avoid being held up for hours.
The chaos was showing no signs of subsiding on Tuesday morning, with around a third of Scotland’s fishing fleet tied up in harbours and some boats taking the drastic step of landing in Denmark and having their catch processed there, in order to circumvent the disruption in Britain.
DFDS, the Scottish fish industry’s biggest logistics provider, has paused exports until at least Wednesday as it struggles to cope with the complexities of moving loads of multiple fish products – or “groupage” – to the continent.
“If we don’t see progress this week, or worse, if we go backwards, the clamour of financial compensation from the government will grow and grow,” Withers told PoliticsHome.
“It is not the fault of businesses that a trade deal came late, that IT systems weren’t tested, or that the Border Operating Model wasn’t published until six hours before the end of the transition period.
“The losses business face for all that will be no fault of their own. Some of the attempts to blame businesses for the problem because did not get ready are disingenuous to say the least.”
David Leiper, managing director of Seafood Ecosse, a wholesaler based in the port town of Peterhead on the east coast of Scotland, said the situation facing exporters like his business was “a disgrace” and called on the government to compensate him and other traders for their losses.
“I would like to be reimbursed for the total failings in the government systems. Why should private companies take the pain for government incompetence?” he told PoliticsHome.
“Companies have spent thousands of pounds and thousands of man hours to be ready for Brexit only to find vital things that government systems are responsible for failing at every point.”
Leiper said that as well as having to deal with paperwork that he had little time to prepare for, he was encountering problems with government IT systems created to handle post-Brexit trade.
Luke Pollard, Labour’s Shadow Secretary of State for Environment, Food and Rural Affairs, said there was a “strong case for the government stepping in” to provide financial support to affected fish exporters, warning that “jobs across the fishing communities are at risk of being lost.”
He told PoliticsHome: “The paperwork and red tape that the industry for years fought so hard against has now been quadrupled by Westminster, and that especially affects small boats.
“Brexit was their great hope that they could have more sustainable and better future, but I am hearing from experienced fishermen and women in a state of deep gloom and regret.”
He added: “The government has announced a £100 million fund for fishing which sounds like lots of money, but they can’t tell us where it will go or when it is coming.
“They use this and say ‘we have taken back control’ to deflect the concerns of fishermen, but you cannot feed your families on soundbites.”
Ed Davey, leader of the Liberal Democrats, told PoliticsHome: “Clearly the government must look at compensating all those businesses suffering because of Boris Johnson’s botched trade deal with our European neighbours. In the middle of a pandemic when so many businesses were already struggling, the last thing folk needed was more costly red tape, but that’s exactly what Boris Johnson has agreed to.”
With freight traffic from the UK to the EU set to increase this week, Withers warned that European customers could turn away from British businesses for good if the issues were not resolved quickly.
“There is a real sense of trepidation this week. Systems are already creaking and falling over under the weight of light volumes,” he told PoliticsHome.
“If this goes on go for much longer, customers in the EU will ask themselves whether it is just too risky to do business with UK firms and safer to go elsewhere. The ripples of this will spread quickly as from a European point of view, it’s about all confidence, and that takes a lot longer to repair than an IT system.”
A UK Government spokesperson said: "We are working closely with the industry to help understand and address the issues they are experiencing. The UK and French systems are working, but we are contacting exporters, their representatives and transporters to help them understand the requirements to keep their goods moving.
"It is vital that exporters check they have entered in details correctly and ensure that they have provided the transporter of the goods with the correct documentation."