Thread by @pmdfoster

Get #Brexit done! Do a zero-tariff FTA with the EU and be free!

Well, here's a story about why it won't be as simple as that, politically or economically.

It involves the £1bn UK egg industry...but others will have similar stories to tell. 1/thread

telegraph.co.uk/business/2019/…

It's an important story because it exposes the contradictions and cakeism in much of the #Brexit political rhetoric...in this case.

1) @michaelgove UK will have "gold standard" of animal welfare after #Brexit

2) DIT + buccaneers promising free trade bonanza... BUT... /2

@michaelgove Why contradictory?

Well, because under UK 'no deal' tariff schedule eggs will have NO tariff protection...like 88 per cent of UK imports into UK...that exposes UK egg industry to competition from cheaper imports from Ukraine, India, USA, Argentina...see this table/3

@michaelgove So..as you can see, without tariff protections, UK will be open to cheap egg imports - 28% cheaper from the USA, 25% in the Ukraine, 18% from India and 16% from Argentina...

And why are they cheaper? You guessed it, they battery farm the hell out of those chucks! /4

@michaelgove The EU banned battery farming in 2012 and UK supermarkets have pledged to stop use all non-caged eggs by 2025...but that means cost. Currently 16% of cost of egg relates to EU welfare standards (which UK consumers want)...BUT /5

@michaelgove If UK leaves EU w/o deal in December 2020, the backdoor will be left wide open to egg products that are 30% cheaper...that will be hard to resist for many UK maufacturers of egg products, and egg processors...but which consumers (when asked) clearly don't want. /6

@michaelgove But they DO want cheaper food and - post #Brexit - the Government will be under pressure hold down food price inflation, which is why HMT (and DIT which needs to go buccaneering) didn't protect the egg and other industries despite lots of lobbying by industry/7

@michaelgove The point here is choices - and politically divisive choices - which I fear the publich hasn't fully internalised...of course they want both cheap eggs and free range eggs, but #Brexit brings that cakeism to a head. Not just in eggs, but right across the spectrum. /8

@michaelgove So, people want lower immigration (promised) but they want a spending spree on public services and infrastructure (promised) but with, for eg, 40,000 nursing vacancies and construction industry labour wage inflation at 6pc, nearly double UK average, it'll be tough to have both/9

@michaelgove But back to eggs...people want em cheap, but they also want them healthy...Ukraine is obvious place for cheap eggs to come from post #Brexit, but as Latvia (chief EU importer of eggs) has warned there are big worries over salmonella controls/10

foodsafetynews.com/2019/08/latvia…

This is where it gets political on so many levels.

- if a salmonella outbreak is traced to cheap US or Ukraine eggs

- if UK jobs (10,000 egg directly in indstury 13,000) are lost

- when consumer groups and animal welfare groups start explaining what's happening /11

So for consumers, about 56% of eggs are 'shell eggs' - bought on supermarket shelves and consumers can check if free range or not.

The balance is 23% price-sensitive industry (cafes, schools etc) and 21% processed (food mfrs etc) where supply is much less visible. /12

Groups like Compassion in World Farming @ciwf will be doing their utmost to keep these issues in the headlines, and news editors love these stories. Across the spectrum, there are headaches to be made. /13

ciwf.org.uk/farm-animals/c…

@ciwf Then there is jobs - many egg farmers are small farmers supplementing incomes by running egg operations. Not a nice target.

Only about 8% of the 21% of UK eggs that go for processing are 'second quality' - so that leaves UK farm output vulnerable to cheap imports /14

@ciwf But what about trade? If the point of #Brexit is to buccaneer, then @tradegovuk cannot cave in to lobbying pressure from everyone to give them protective tariffs, because that will make life harder when it comes to doing deal with USA, Ukraine etc. /15

The govt has promised a 'consultation' on tariffs if the no-deal sched kicks in, but Mark Williams, head of British Egg Industry Council is sceptical that govt will listen.

But as @DavidHenigUK tells me, there will by many of these issues, partic in food and drink sector./16

And of course, if UK does cut deals that enable cheaper eggs raised with lower standards, then that will presumably raise rules of origin issue Dover-Calais...

(EU chucks have 750cm/2, litter, perch etc; fgn chucks get 450cm/2 max in old battery conditions) /17

Will UK cakes entering the EU that were made with non-compliant Ukrainian egg powder be eligible to enter tariff free? Or will manufactures need to show UK-orgin/compliant eggs?

Either way, it means cost - to pay the tariff or demonstrate compliance. /18

All this by way of trying to demonstate why the nitty-gritty of Brexit is going to be hugely challenging, since it will confront politicians with hard trade-offs that they have been spared in the largely rhetorical phases thus far.

The egg industry is not alone! ENDS/19