Food producers face ‘financial cliff edge’, Government warned

18-Jan-2021 - Last updated on 18-Jan-2021 at 13:39 GMT

Richard Harrow, BFFF chief executive

Food manufacturers supplying the hospitality and healthcare markets have called for urgent Government support to rescue them from ‘a financial cliff edge’.

A group of 18 trade associations, led by the British Frozen Food Federation (BFFF), has written to chancellor of the exchequer Rishi Sunak and other Government ministers. They have asked for the following support measures to be put in place for food manufacturers with immediate effect:

Extension of the 12-month Local Authority Business Rates exemption to businesses supplying into the hospitality and foodservice market, using the existing legislative exemption for hardship.
Ongoing capital and tax break allowances to maintain the workforce, prorated depending on how many staff a company can keep employed.
Formal deferment of PAYE and NI payments until the end of 2021, basing the final removal of that deferment on businesses returning to a commercially viable level of operation.
Increase of the level of funding for the Additional Restrictions Grant, along with clarification of the application process clear and accessibility of funding.
Provision of grants for companies that have had to dispose of fresh short life stock either through waste or charitable donations.

Bleak winter

BFFF chief executive Richard Harrow is concerned some food producers are on the verge of going out of business. That would leave many pubs, care homes, restaurants and hospitals with no suppliers when the economy emerges from the pandemic.

“England’s national lockdown, plus restrictions in the UK’s other nations, have been devastating for our many businesses supplying the hospitality and foodservice markets and they are facing a bleak winter,” he said.

Danger of collapse

Harrow added: “Many of the ‘squeezed middle’ are often successful family-owned SMEs and are now facing collapse. Support for this important sector is vital to ensure they continue to manufacture and supply world leading products, making the market so dynamic and vibrant. Their continued existence will be critical as the economy starts to recover.”

“Those businesses in the ‘squeezed middle’ have not been given the same level of government assistance as the businesses they supply, despite being as hard hit by the restrictions.”

The 18 trade signatories of the letter to government are: