News / UK government defends 'crippling' fee for plant and animal product imports

© Aaron Amat

Defra, the UK’s food and environment ministry, has insisted that its Common User Charges, announced yesterday for plant and animal products entering the UK via Dover and Eurotunnel, followed “extensive consultation” with industry. 

From 30 April, the flat-rate of £10 or £29 per commodity will be capped at £145, “specifically to help smaller businesses”, a spokesperson for Defra told The Loadstar. 

Industry – and smaller businesses – do not agree.  

“The charges threaten to cripple SMEs in the fresh produce and plant sectors,” said Nigel Jenney, CEO of the Fresh Produce Consortium. 

The consortium said it had been predicted that the charges would add £200m in costs for the fresh produce sector, at a time it is already struggling with inflation, and: “This is simply not a manageable cost for our members,” said Mr Jenney.  

“These exorbitant charges imposed by our own government represent a direct tax on businesses. It’s a move that will undoubtedly shatter supply chain confidence and is already encouraging EU exporters to reconsider their commitment to supply the UK market.” 

These rates only apply to goods entering the UK via Eurotunnel or the port of Dover. Other commercially run entry points, of which there are about 30, will set their own rates.  

Defra calculations claim the new rules would have “minimal impact” on food price inflation, with initial analysis indicating it would lead to an increase of less than 0.2% over three years. 

But, the FPC added, the rules would also cause disruption, delays and other costs. 

“The CUC system is particularly devastating for SMEs,” said Mr Jenney. “While fees are now capped, they remain substantial – £145 for every consignment arriving in the UK via the port of Dover or Eurotunnel. This might not seem like much, but with only a small number of consignments actually inspected, the cost per inspection balloons to a ludicrous £5,000.” 

But the Defra spokesperson said the charges were “within, and at the bottom end, of the range which we consulted with industry on”.   

“The charge is designed to recover the costs of operating our world-class border facilities where essential biosecurity checks will protect our food supply, farmers and environment against costly disease outbreaks entering the UK through the short straits.” 

But Andy Fitchett, head of brokerage and customs compliance at Metro Shipping, told The Loadstar: “The cap is fine if you are a supermarket with a buyer’s consolidation, but for purveyors or artisan products in minimal quantities this will have an impact.

“But it’s not a surprise, it’s been kicked down the road five times now, and the final implementation seems to be recognised as a shock by traders that its finally happened.

“I’m not sure what contribution the lower figures will make to offsetting the cost of these ‘world class facilities’, but perhaps there is a bigger argument to be had between the ports and the inland facilities.”

The Federation of Small Businesses (FSB) weighed in too. National chair Martin McTague said: “Small firms are already operating under tight margins, and heaping extra costs on them with less than a month’s notice gives them very little time to prepare for the financial impact of new costs.  

“Inflation might be coming down, but small firms are still grappling with its after effects, and don’t really have any cash to spare right now. 

 “There’s also an administrative burden to consider. This impact could stretch far beyond the supply chain, affecting high street delis, cafés, and restaurants.” 

Meanwhile, the British Chambers of Commerce called on the government to reconsider. 

William Bain, head of trade policy, said: “This is an extremely disappointing decision by Defra. The level of import charges shows scant regard to the interests of both businesses and consumers.   

“A flat rate fee for bringing most animal and plant products into the UK is a hammer blow for small and medium-sized importers. It’s also deeply concerning for retailers, cafes and restaurants.   

“The clock is ticking to 30 April, when these charges will come into force. We urge the government to reconsider the import charge plans in the coming days. Failing to do so risks higher prices for us all, at a time when we should be bearing down on business costs and food price inflation.” 

The government had a “mix” of viewpoints, and decided to rule out charging by inspection, or weight because they were not “proportionate” and did not keep the rates as low as possible for businesses of all sizes. The charge was, in the end, calculated by dividing the operational costs of planned government-run BCP facilities by the forecast volume of import commodities eligible for checks, distributing the cost across business of all sizes. 

When asked if that, in effect, meant that smaller businesses were subsidising larger ones, Defra declined to answer. 

Mr Jenney said: “These insane charges are an attack on those working tirelessly to feed and flower our great nation. The government seems hellbent on punishing businesses that are the backbone of our economy and our health.” 

The charges will not apply to low-risk plants and plant products, or those transiting the UK. The charge will apply to each commodity line in a common health entry document (CHED), but limited to five, meaning medium- and high-risk CHEDs will be capped at £145. Low-risk products of animal origin CHEDs and POAO transits will be capped at £50. 

Common user charge rates 

The following rates will be charged for each commodity line in a CHED. 

You can see all the charges explained here