Agriculture, food and fisheries minister George Eustice told the House of Lords EU Energy and Environment Sub-Committee on 28 February that the government acknowledged a range of workers was needed for different food industry sectors.
“In horticulture there is a need predominantly for seasonal agricultural workers. In other sectors, particularly meat processing and fish processing, you find there is quite a high dependency on permanent staff from eastern European countries,” said Eustice.
He added that other sectors, such as chocolate manufacturers, had no need for labour outside the UK.
Depends on the sector
“It does depend on the sector,” he told the peers.
He said there was some evidence that the availability of low-cost labour had actually stopped developments in mechanisation, which could improve efficiency for some areas of the food industry.
He also dismissed claims that food prices were set to escalate after Brexit, even under World Trade Organization (WTO) rules.
‘Prices won’t really change’
He said the “most likely scenario” was that “prices won’t really change much at all”.
Eustice said: “We are likely still to have a free trade agreement with the EU and, even if we didn’t, the analysis out there shows that the impact on food prices would be quite marginal, within a few percentage points, before you take into account the freedom you would have even under WTO rules.”
He said the reality was that food prices were driven predominantly by energy prices and commodity prices around the world.
The Resolution Foundation’s own research, he said, showed that even under the “extreme scenario” food prices might only go up 4%.
He said that, for a bakery business, the price of materials such as wheat equated to about 9% of the cost of production as other factors such as the plant machinery and delivery vans must be factored in.
“The truth is on bread prices that a few pence on the price of diesel is likely to have far more impact than a few tariffs on wheat,” he said.