Analysis: Brexit and the implications for horticulture

A week after the vote to leave the EU, the consequences of the referendum decision are manifold.

Cameron has resigned, Corbyn has lost his parliamentary party, Boris has launched then ended his leadership bid, May is the favourite to take over, Scotland is talking about independence and markets remain volatile with banks and housebuilders particularly hit.

It will take months for the full implications of Brexit to show, both politically and in business, and there will inevitably be opportunities for some. But as the country enters a period of political and economic instability, I will try and outline the process of Brexit and then three of the key issues that may be of most relevance to horticulture.

Brexit - the process

Immediately following the result, Cameron announced that he would not trigger Article 50 of the Lisbon Treaty, which once triggered means the UK will have two years to negotiate its exit and reach a deal with the EU. During this period the UK will continue to abide by EU treaties and regulations, and retain full access to the single market, but it will be formally excluded from any decision-making at the EU level, including EU Council meetings.

Once a draft deal is agreed it must be ratified by at least 20 EU member states. However, should a deal not be reached in the two years the UK will automatically leave, whether it likes the deal it has or not.

Several EU leaders have stated that they will not begin negotiations until the UK triggers Article 50 and EU Commission president Jean-Claude Juncker has urged the UK to "clarify its position" on Brexit "as soon as possible". This desire to expedite the process is likely to be an effort to quell uncertainty and prevent other member states from looking to follow the UK's example.

The deal to be reached over the next two years is the process of cutting the ties between the UK and the EU. However, beyond this is the broader framework agreement determining the future interaction between the two, including rules on trade.

A Cabinet committee has been established to lead Civil Service work negotiating and delivering Britain's departure from the EU, led by Oliver Letwin MP who will report to the Cabinet. Any final decisions will remain in the hands of the next prime minister, but the committee will lay the groundwork.

As well as negotiations at the EU level to carve out a workable relationship, the UK will also need to begin a legislative process at home to determine which EU statutes and regulations should be replicated, amended or replaced in UK law. While elements of this will be linked to negotiations at the EU level, there will also be a clear and distinct domestic agenda, with many who voted for Brexit wanting to see the UK exercising its sovereignty and ridding its self of the shackles of EU membership. Whatever happens, we are likely to see the biggest legislative upheaval in British political history.

This will have implications for regulation directly impacting horticulture - such as the plant health regime - but will also indirectly impact things such as access to migrant labour and skills.

The Government will have to introduce a large number of technical bills before Parliament, presenting both opportunities and threats. There will be opportunities to reshape the regulatory environment to benefit British businesses. There will also be elements of EU legislation that must be retained to enable UK horticulture companies to continue to do business there successfully - such as plant passporting and producer registration, without which it would not be possible to export UK products without significant red tape.

1. Trade

Having continued access to the single market without being subject to restrictive and costly tariffs is an essential lifeline for many in the horticulture sector. For example, the common seed market, which allows free movement of seeds and has seen extensive harmonisation of technical requirements across member states or the ability to trade plant material, equipment and finished plants freely.

Should the UK seek to achieve single market access by joining the European Economic Area (EEA) this will come at the cost of accepting EU regulations that, outside the EU, the UK will have no opportunity to influence. If, on the other hand, the UK opts to "go it alone", businesses will become subject to tariffs and other restrictions unless and until the UK is able to negotiate a more favourable bilateral arrangement with the EU that could harm the industry's competitiveness.

Access to other markets beyond the EU would also need to take place on a bilateral basis, meaning that the UK would have greater freedom to negotiate terms but would lose the bargaining power of being part of the larger EU bloc and may have to open up to imports from other countries.

2. Plant health regulation

Given the level of interdependence between the horticulture industries across the EU and shared challenges around biosecurity, plant health and innovation and skills, going it alone is by no means easy for the UK.

As it stands, the UK abides by a number of EU Council directives designed to protect it from harmful pests and diseases. While the general principles of this would be upheld in line with the International Plant Protection Convention, the UK would need to decide how it continues to do so - which aspects of EU law to uphold and which ones to change.

Equally, should the UK wish to retain access to the single market as part of the EEA, it would not only have to retain existing EU legislation but also implement future legislation without the ability to shape or influence it - for example, updates to the plant health regime currently being debated. There is also a whole host of other directives and regulations such as those on plant-protection products that will no longer apply to the UK.

Depending on the regulation or directive in question, this could be both beneficial or potentially damaging. For instance, the amenity horticulture sector could be given more freedom on the chemicals it uses but this would also require the UK to think again about its position on issues such as the use of neonicotinoids to ensure that environmental protections delivered by the EU are upheld.

Brexit also means that many decisions at the EU level will be delayed as the EU turns its head to negotiating the UK's departure as a matter of urgency.

3. Labour

Given the unexpected margin by which the Leave camp won the referendum and the toxic nature of the issue of immigration during the campaign, it seems likely that no matter who is negotiating the UK's exit they will be reluctant to accept freedom of movement as a condition of any deal. This puts the UK in a difficult situation, significantly limiting the scope of any agreement and seemingly ruling out the EEA option unless agreement can be reached on this point.

At present, many employers in the sector take advantage of freedom of movement by employing staff from across the EU as either full-time or seasonal workers. Brexit could bring an end to this access and also cast into question the future of those EU migrants already here, meaning that the sector may need to look to alternative arrangements to fill those vacancies.

Defra minister of state George Eustice has suggested that the UK could return to using seasonal agricultural workers schemes and other similar arrangements to facilitate this, but again this is something that would require fresh legislation.

Mark Glover is Bellenden Chief Executive and Association of Professional Political Consultants Chairman

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