New research published by the Institute of Economic Affairs (IEA) has suggested that Brexit could save the UK £7.5 billion a year in food costs.
Data published by an IEA think-tank, which supported Brexit, says that if the UK had stayed in the EU the additional “compliance costs” would have cost billions.
It argues that regulations such as the Common Agricultural Policy providing subsidies for EU farmers is already costing England £600 million a year and that if the EU reviewed its legislation on pesticides, the UK would see a lower food yields and higher prices.
According to the IEA, these costs upon the UK food chain — including grocery retailers and grocery shoppers — could reach up to £7.5 billion.
“EU member states face staggering food price rises unless the march of increased regulation is halted. The UK is fortunate that it now has the opportunity to repatriate control of its farming regulations,” IEA director Mark Littlewood said.
I think @StrongerIn are confusing something being certain with it being desirable. If you jump under a bus, you’re pretty certain to die.
— Mark Littlewood (@MarkJLittlewood) March 10, 2016
“It’s crucial that decisions stem from good scientific evidence, and pay attention to consumers’ interests and the potential crippling costs that overregulation can have in pushing up food prices and the cost of living.”
UK farmers received £2.1 billion in direct subsidies last year, as well as £600 million in rural development payments from the EU. These payments made up 55 per cent of farmers’ incomes last year.
Nick Clegg warned earlier this week that leaving the EU would cause “whopping” tariffs on imported foods such as 59 per cent levy on beef and a 38 per cent rise in chocolate.
The Treasury has also released conflicting evidence for the report, claiming that the 12 per cent drop in value for the pound could add £123 to the average food bill.
This report follows the first concrete signs of Brexit’s affect on shoppers’ pockets, as Tesco refused to pay an extra 10 per cent for Unliver products following the devaluation of the sterling.