The continuing insidious cost of Brexit to our economy

The Guardian reports that government figures released on Tuesday reveal that UK companies spent up to £65m last year on licences to export food and agricultural products to the EU, with 328,727 such licences issued last year, at a cost of between £113 and £200 each.

The paper says that Nick Thomas-Symonds, the Cabinet Office minister in charge of European negotiations, has pledged to eliminate such costs as by promising a new agreement with the EU in the next 18 months:

Keir Starmer announced a new agreement with the EU in May, as part of which ministers agreed to pursue a series of specific deals, including one on food and agricultural products.

The prime minister was attacked at the time by the Conservative leader, Kemi Badenoch, who argued that the UK was “being dragged back” into the EU, and Farage, the Reform leader, who called it a “Brexit betrayal”.

Labour ministers have been keen to avoid any perception that they are reintroducing a customs union or free movement by the back door. But Thomas-Symonds’ speech on Wednesday indicates they are feeling more confident about making a pro-EU case for removing trade barriers.

He will say the government is “putting in the hard yards, not resting on empty slogans” and that its policy is based on “sovereignty, in the national interest”.

Labour says its new agricultural deal will mean fewer checks on meat, fish, fruit and vegetables imported from the EU, and an end to the current export-licensing scheme.

A report on Tuesday from the Department for Environment, Food and Rural Affairs said these costs had been particularly burdensome for smaller business, warning: “These firms often lack the capacity and economies of scale to manage the administrative and compliance demands associated with NTMs (non-tariff measures).

“This has created a competitive disadvantage between smaller firms and larger operators with in-house capability – although all stakeholders report increased costs.”

In April, British supermarkets and food producers, including Marks & Spencer and Sainsbury’s, urged the EU to complete the proposed goods and agricultural deal, saying the existing arrangement had led to “unnecessary red tape”.

This new approach is very welcome of course, but the government is still skating around what need to be done, which is to rejoin the single market as the earliest possible opportunity.