The British Retail Consortium (BRC) in its recently published analysis of the possible impact of Brexit on retail spending and shop prices, “Which Way Out? A Fair Brexit for Consumers”, has called on the Government negotiators, “to put consumers first in the forthcoming Brexit talks by ensuring their sights are firmly set on keeping shop prices low once the UK leaves the EU.”
Wishful thinking possibly given the unwillingness of the Prime Minister and Cabinet colleagues to provide the country with a regular progress report on negotiations including those importantly impacting on trade.
The BRC notes that “failure to strike a good Brexit deal by 2019 would have a disproportionately severe impact on retailers and their customers because, if the UK fell back on World Trade Organisation rules, the new tariff rates the UK would apply to imports from the EU would be the highest for consumer staples like food and clothing.” The BRC foresees the duty on meat imports, in such circumstances, could be as high as 27%.
Further the BRC notes in “Which Way Out” that some retailers, and consequently consumers, are being impacted by the higher cost of imports that has resulted from the pound plummeting against foreign currencies.
Importantly we are increasingly media interest in, and reporting of, the consequences of Brexit here and now. Katie Allen, reporting the launch of the BRC in the Guardian on 11 October, noted David Davis’s comments that Government could do little to stem speculative comments that could drive the pound up or down in the next two and a half years.
As Katie Allen further notes voices opposing the BRC’s analysis and projections believe that leaving the single market and embracing unilateral free trade could reduce consumer prices by around 8%. Some hope.
The reality is that the devaluation of the pound is not a short term blip. Regardless of how long the trade negotiations take and the terms that result, we will in the meantime see higher prices for imported consumables. All the evidence so far is pointing to a higher cost of living in the wake of Brexit.


