Compensation fund for seafood exporters may be 'too little, too late'
Scotland's rural economy secretary Fergus Ewing has warned that a UK government compensation package may be "too little, too late" for some of the seafood exporters who have been unable to get their goods into the European Union.
He said the emergency funding needs to be open to all businesses that have been affected by the border delays arising from new export rules following the end of the Brexit transition period.
Prime Minister Boris Johnson has pledged a £23 million compensation fund to help seafood companies that have had trouble exporting "through no fault of their own".
Mr Ewing said: “As feared and predicted, the new trading relationship with the EU is having a catastrophic impact on Scotland’s food and drink export industry. It is very clear that the UK government should have extended the transition period as we called for, due to the pandemic and lack of progress in the negotiations.
“We have repeatedly pressed the UK government to act quickly and compensate businesses affected by the ongoing trade issues. I am pleased to see they have finally recognised our calls for compensation but I remain concerned this may be too little, too late for some businesses that have been left to rot as a result of the extensive bureaucracy forced on them by a poor Brexit deal and failing UK IT systems.
"While we desperately need more detail, it does appear almost certain that the vast majority of fishing vessels that land but don’t export directly will not be covered by this scheme, which is beyond any rational explanation.
"The UK government must step up for all affected businesses. They simply cannot deny the impact that non-tariff barriers are having following the UK government’s decision to leave both the single market and customs union of, by far, our largest market.
"They must ensure that their compensation package is open to all whose business has been interrupted or harmed by any aspect of the new export requirements. Any attempt to apply conditions or boundaries will render the scheme meaningless and pointless."
UK environment, food and rural affairs secretary George Eustice told the House of Commons last week that the difficulties facing seafood exporters amounted to "teething problems", and foreign secretary Dominic Raab made the same comment in a TV interview at the weekend.
Mr Ewing said: “As desperately needed as this compensation is for affected businesses, this is merely a sticking plaster for much wider issues and not 'teething problems' as has previously been claimed. I again reiterate my call for the UK government to immediately rectify their IT problems and seek a grace period with the EU.
“It is also unacceptable that the UK government did not consult us on this funding package, as our view and that of the Scottish industry is that devolved governments are clearly best placed to take decisions and administer spending in their areas. We proved this with our schemes to provide support for all businesses affected by the pandemic.
"To exclude us from this scheme will delay speed of its delivery and further jeopardise Scottish seafood businesses.”
Diane Watt, who runs Caithness-based Holborn Fishing Company with husband Andrew, has questioned how effective the £23m fund will be. “If you divide all that between all the shellfish folk, it's not a huge amount," she said. "How they will split it, I don't know – or when that will be.”
Donna Fordyce, chief executive of industry body Seafood Scotland, said: “After almost three weeks of voicing their concerns and frustrations, we welcome the fact that the Scottish seafood sector has been heard and action is being taken. While we await the full detail of the package, we know that there will be questions around the extent to which it supports the entire supply chain, from fleet to export.
“As we currently understand it, the deal offers crucial short-term assistance and includes much to be welcomed, particularly the £23m of new funding.
"It is also reassuring to see that the processing sector is set to be included in future support packages. This will offer a ray of light to some small and medium-sized companies that have experienced crippling losses over the past few weeks.
"However, larger companies and smaller shellfish boats are still vulnerable, and will be hoping that they can access support too.
“Money will offer a much-needed sticking plaster covering the losses over the last few weeks – but, to completely staunch the wound, the sector still needs a period of grace during which the systems must be overhauled so they are fit for purpose. It is also essential that groupage returns to a fully operational state as a matter of urgency.
"The announcement is certainly a step in the right direction and we will continue to work with industry, partners and government to ensure the sector gets the proactive support it so desperately needs.”
Caithness, Sutherland and Easter Ross MP Jamie Stone has been urging everyone in the fishing industry caught up in the crisis to get in touch with him so he can confront the UK government over their experiences.
A UK government spokesperson said: "We recognise the fishing industry is facing some temporary issues as businesses get used to new processes for exporting following the end of the transition period.
"Our priority is to ensure goods flow smoothly to market and we are working closely with industry and the authorities in EU countries to understand and address any issues with documentation."