Small fishing businesses will “probably” go under due to the increased costs of complying with Brexit red tape when sending their catch to Europe, industry experts have warned.
MPs were told that some fishing firms are even looking at relocating parts of their operation to the European Union in order to by-pass costs and bureaucracy, with Brexit changes expected to hit profits by as much as £500,000 per year.
Some businesses have reported requiring more than 70 pages of paperwork to transport one lorry of fish into the EU.
The Environment, Food and Rural Affairs Committee heard that the combination of Brexit and the Covid-19 pandemic had caused the “perfect storm”.
“You just could not have written it any worse if you had wanted to for the industry,” said Sarah Horsfall, co-chief executive of the Shellfish Association of Great Britain.
Martyn Youell, a senior manager at south-west England fishing company Waterdance, said: “Sadly, there are some extreme forces operating on the supply chain and we probably will see some forced consolidation or business failure and that is impacting the fishing industry.
“We are struggling to find markets for some of the products we previously had very good markets for through small-scale exporters.
“Those at the more medium size, their costs have increased dramatically.”
The former civil servant said Brexit was in danger of causing UK fisheries jobs to move elsewhere.
“The exporters we deal with are seriously considering relocating part of their processing business to the EU because of the difficulties we face at the moment,” he added.
“It cannot have been the aspiration of Brexit, with fishing as the totemic issue and which a lot of people voted upon, to actually lose jobs within fishing and the supply chain, including boats landing overseas because the paperwork is easier.
“We are at serious risk of doing the very opposite.”
Donna Fordyce, chief executive at Seafood Scotland, said if smaller companies had to cease trading with Europe due to rising costs – with increases predicted to be between £250,000 to £500,000 per year for exporters – then it could be their “demise”, given the reliance on the continental market.
With customs and paperwork delays meaning it is taking as long as 39 hours to get products to market – up from 22 before the Brexit deal came into effect in January – the Scottish seafood chief warned the UK was in danger of being usurped by competitors due to the “reputational” damage being done to the country’s fresh products.
Ms Fordyce, giving evidence during Tuesday’s two-hour session, added: “There are other countries waiting to take up these contracts – the Norwegians are all over the salmon. These will be long-term losses.”
The Prime Minister, who previously said his Brexit deal would be “very beneficial” in the medium to long term for fishermen, reportedly wants Britons to eat more of the fish caught domestically, with most of what is hauled in exported elsewhere.
But Ms Fordyce said there were no “quick fixes” and that it could take two years to get new products on to supermarket shelves.
Mr Youell said it was a “poor choice of words” for ministers to describe the current issues as “teething problems” and called for “political action” to solve problems that were “systemic issues of trade”.
“Whilst some things have settled down, some obvious issues, we feel that we remain with at least 80% of the trading difficulties that have been encountered and are in existence today.
“They are not teething problems for us,” he added.
MPs were told that allowing the “extremely excessive” amount of physical paperwork to be made electronic could help smooth the flow of moving seafood products, but it would still leave an “unwieldy” system without political changes.
All three witnesses called for UK Government compensation to hard-hit businesses to continue and to possibly be widened to reflect added costs being incurred, not only profit losses.
The committee also heard from Nick Allen, the chief executive of the British Meat Processors Association, who said: “We can’t get away from the fact that actually this system is creating delays and even when our members are getting it right – and a lot of them are starting to get it right and getting their paperwork right – there’s still delays built in.”
He told the MPs “it feels as though we have stepped back into the 1950s”, with lorry drivers travelling around carrying “huge quantities” of paperwork.
He added: “If there’s one quick fix I would like sorted at the moment, is for all the border control posts to be working off the same set of guidelines.”
Charlie Dewhirst, from the National Pig Association, said: “We couldn’t predict that Rotterdam wanted it in red pen and Calais wanted it in blue pen and if it was wrong it was going back.
“Those are extreme examples but that was the sort of thing they were facing.”