City Pub Group chairman Clive Watson writes for MCA about his concerns that Brexit remains a “monumental mistake” and discusses the potential impact on the sector.

Two years on from the 2016 Referendum there will be a march in support of a People’s Vote on the final Brexit deal. This is not an attempt to re-run the 2016 Referendum- it is a reasonable demand to give the electorate the opportunity to have the final say on the Government’s Brexit deal.

I campaigned and voted for Remain primarily, because I believe in pooling sovereignty with other allies in a Collective Security Arrangement (NATO) which is strengthened by having a Collective Trading Agreement (Single Market/Customs Union). British membership of the EU has been a key foundation to these pillars of peace and prosperity in Europe. Remain Lost- we are leaving the EU for now and today’s argument is now focused on the economics.

Custom Free Access

Many sectors of the economy will nervously be awaiting the Government’s White Paper on their future trading arrangements with Europe. Wether it is the financial sector, the car industry, aviation etc. All industries will be concerned with the limits on their access to the EU’s Single Market. A key sector, agriculture, which has a significant influence in relation to the hospitality sector still has no idea as to where its future lies. Just over 60% of our food supplies come from the UK- much of the so-called £350 million a week extra for the NHS is actually in the form of subsides for the UK farming industry. Many farms rely on these subsidies to supplement their incomes- flooding the market with cheap but inferior imports from countries far beyond Europe will decimate the UK farm producers. Cheap food imports are often deemed to be a ‘Brexit Gain’ but a country’s ability to feed itself has to be one of its most important objectives. Brexit economists believe so-called cheaper imports of food with resulting food lower standards as a price worth paying, I believe that there are industries, such as agriculture that need continued support to maintain their viability. Of course there can be reforms with the existing subsidy arrangements, but lets maintain our support of the UK farming industry so we can have as much home grown food with proper controls over its quality and standards.

Of the 40% of food that we import 80% of this comes from the European Union. If we restrict the access of our farming trade with the EU we will then be undermining the EU food supply chains that have been established over many years. Anyone who works in the freight industry will tell you that additional tariffs, additional quotas and additional documentation will cause major delays. not only on the roads but at ports such as Dover. We have seen only recently the potential chaos when Bargain Booze went into administration and their supply of goods started to dry up. In this situation, there were ready made alternatives who were ready to step in and fill the vacuum. In the case of the food supply chain from the EU, any delays at the ports, on the roads, or the railways will see disruption 5,000 times worse than what we saw following the demise of Bargain Booze. Fresh food will literally rot in the ports, there will be delays in supply of all types of foods, including dairy, meat and vegetables. In accessing imports from outside the EU, higher distribution costs will have to be paid. To replicate the EU supply chain will take years- talk of a no-deal Brexit or one where there is limited access to the EU supply chains is highly dangerous- has not been thought through and will jeopardise not only our industry but also the supplies for supermarkets. I am old enough to remember the Docker’s strike in the early 70’s. Many basic foods weren’t available- a customs nodeal would magnify this for months and months. I’m not old enough to remember rationing in the 50’s but this might need to be introduced if we lose our access to the EU’s food supply.

It wont just be the supply of food that will be threatened. If there are tariffs and quotas there will be adverse effects on drinks such as beer and wine that come from Europe. The cost of catering equipment will go up and if there are adverse effects on aviation, this will have a terrible impact on our tourist industry. I can cite the example of when West Berkshire Brewery recently installed their new brewery. All the kit came from Italy, shipped over bit by bit. Imagine if this equipment had been stuck in customs awaiting the correct documentation, being subject to tariffs- the delays and the cost overruns would have been immense.

Immigration

This is an area which I know is very sensitive. However, it is important that our industry speaks out and tells the politicians about the labour shortages that we are facing. I do not know of any company that is not facing recruitment problems in the kitchen. The emphasis now on wet-led pubs is virtually entirely due to the shortage of chefs and the increased costs of food directly as a result of Brexit.

How can you open a new hotel, a new restaurant, a new leisure centre if you can no longer fill the jobs? The Brexiteers will claim that we are not paying them enough but the cost pressures in our industry are so immense that many businesses are already going to the wall. If you are having to change your business model to avoid future risks of staff shortages your business opportunities will start to become limited.

On a personal note, one of the great joys for me in having European staff in our pubs is that they would tell me that when they went back home, they would tell their friends what a great country the UK is. If we pull up the drawbridge on a flexible labour market coming from Europe, not only will the food offers in our sector start to decline (remember our restaurant industry before the 90’s) but we will lose that cultural diversity. Heaven knows how the hotel sector is going to continue with its operations due to shortages of the kitchen and cleaning staff. Its eventual decline will lead to less tourism and less money for this country.

EU Social chapter

For the architects of Brexit one of their constant bugbears has been the EU Social Chapter. These rights are ingrained in our employment laws. They protect employees when businesses are sold, they have provided for improved maternity benefit, paternity leave, better working conditions, shorter working weeks, equality between men and women and better social security conditions. Not only has it created a level playing field across Europe but it has promoted social Justice. You only have to look at the new ‘Gig-economy’ to see how employers are trying to avoid their obligations to their employees. This nation’s workforce is a massive part of the success of our economy, and are hugely important in the success of our own industry. If we leave the Single

Market these rights will be undermined, reduced and eventually revoked. Don’t Believe me? Read Iain Duncan Smith’s speeches in Parliament about his hatred of the rights given to employees as a result of this country singing up to the EU Social Chapter in the late 1990’s. The Brexiteers will strip back these rights bit by bit and extoll the virtues of the ‘gig-economy’ in their pursuit of a ‘laissezfaire’ free market.

So I will be marching with my family and friends on June 23rd with a heavy heart but with a clear mind. I believe leaving the European Union and retreating from Europe to be a monumental mistake. I believe leaving the economic arrangements of the Single Market will amplify that mistake. Once we leave, we will never be allowed to return on the terms we enjoy now. It took us 13 years and 3 attempts to become members of the old EEC. If we leave the Single Market and Customs Union and turn upside down our economic arrangement with our European allies, it will take us a generation to get back in. When Brexiteers say no deal is better than a bad deal, ask them to explain actually what a no deal means. It means no access to the World’s largest market, it means leaving the European Medical Agency, leaving EURATOM, it means decimating our car industry, our agricultural industry, grounding aeroplanes which will all eventually lead to a ‘brain drain’. Food will not only rot in the docks but also in our farms as no one is there to pick it- there will be higher costs to travel, border issues in Northern Ireland, a risk of breaking up the United Kingdom- is this what we really voted for?