Scottish Government: Threat to food and drink sector

Labour shortages causing damage to businesses.

Rural Affairs Secretary Mairi Gougeon has called for ‘meaningful engagement’ with the UK Government over issues impacting Scottish food and drink businesses.

Writing on Friday (23 Feb), she again called for a meeting with the UK Secretary of State for the Environment, Food and Rural Affairs to discuss red tape and labour shortages that are seriously impeding the sector.

The letter said:

Dear Steve,

I have written repeatedly now, and to successive UK Government Ministers, to highlight the scourge of labour shortages on our invaluable food and drink sector. I have to say that I am confounded at the lack of substantive response that I have received.

The only conclusion that I can draw reasonably from this, is an apparent lack of interest, on the part of the UK Government about this very significant issue and which is of great importance to the sector, as highlighted by it again in its joint letter to the UK Government of 06 February 2024.

That letter recognises that UK migration policy may not be the only answer to labour shortages but also urges the UK Government to recognise it is a very significant factor. It says ‘the UK requires a sustained high level of annual net migration to maintain the size of the UK’s workforce in the context of our ageing population. Businesses who cannot recruit people into key positions will ultimately fail, and that has a knock-on effect across the supply chain and the wider economy.

In effect, the post-Brexit loss of EU nationals has led to significant and immediate gaps in labour that cannot be quickly or easily replaced. This is particularly true for those parts of the sector that have traditionally relied on migrant labour and who are now feeling that loss most keenly.

Surely, we all have a shared interest in a UK immigration system that ensures business can access the labour that they have very clearly said they need. The joint letter from industry could not be clearer about that message.

It highlights that recent UK Government announcements about migration policy, such as the adjustments to the Skilled Worker Visa salary thresholds (to increase the minimum earnings threshold from £26,200 to £38,700) have the potential to impact seriously on our food and drink sector.

We also continue to await your government’s response to the 30 June 2023 independent review of labour shortages in the food supply chain in England. I have written repeatedly to UK Government Ministers to ask for early sight of your response to that significant review given that any actions that the UK Government takes, in light of the review, could make a real difference to help address labour shortages.

The UK Government response was expected last autumn, and I understand that it has since been deferred until early this year, but we still have no information about exactly when it will issue or whether we or the other devolved governments will receive advance sight of it. At the same time, the sector is beset by an array of issues.

While it is bad enough to attribute those issues to the continued legacy of Brexit, some of these (e.g. UK Government proposals to extend the ‘not for EU’ labelling requirements beyond the terms of the Windsor Framework, so that they apply to certain agri-food products GB-wide, rather than just those products destined for Northern Ireland) seem to be choices taken by the UK Government.

On the face of it, these seem arbitrary and are likely to have a disproportionate impact on industry. This is also at a time when further red tape, from import controls, are pending with checks ramping up in April and beyond and consumers are already bearing the burden of added food costs.

All of this points to UK policies that continue to be made without due consideration of economic impacts on, or meaningful consultation with, the industries most affected by it, including our sensitive seafood and red meat sectors. Rather than my having to resort yet again to another letter about all of these issues, it would be best for us to meet to discuss how we can work together effectively to try to make some headway to support the sector.

This could be at our next EFRA portfolio inter-ministerial group meeting, together with the other devolved governments, and/or in a bilateral meeting with you. I would hope that, in doing so, you can reverse the trend of poor UK Government Ministerial representation at these very important meetings.

Instead, we should work together to help address the cumulative impacts on the sector. This approach is surely in the best interests of the sector that, amongst others, we are in Government to represent.

I am copying this letter to Shirley-Anne Somerville MSP, Cabinet Secretary for Social Justice; Mairi McAllan MSP, Cabinet Secretary for Wellbeing Economy, Net Zero and Energy; Emma Roddick MSP, Minister for Equalities, Migration and Refugees; James Cleverly MP, Secretary of State for the Home Department; Mark Spencer MP, Minister of State for Food, Farming and Fisheries; Vaughan Gething MS, Minister for the Economy; Lesley Griffiths MS, Minister for Rural Affairs and North Wales and Trefnydd in the Welsh Government; and to Andrew Muir MLA, Minister for Agriculture, Environment and Rural Affairs in the Northern Ireland Executive.

Yours sincerely,

MAIRI GOUGEON