How the Government can work with the food and drink industry
13 March 2023
The UK Government can help the food and drinks industry deliver for households across the country by supporting them to boost productivity, stimulate business investment and create higher skilled, better paid jobs
Download the full FDF Budget submission below
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The food and drinks sector welcomes the Chancellor’s four pillars of economic growth – Enterprise, Education, Employment and Everywhere. With a footprint in every region and nation in the UK, the food and drink manufacturing industry contributes £30 billion to the economy, employs nearly half a million people and has invested £21 billion through capital and R&D projects in the last five years.
Our industry is the beating heart of the UK economy. It powers who we are, and what we do as a nation. Every household up and down the country have some of the UK’s favourite brands in their cupboards, fridges and freezers. Delicious and quality food can be found in our shops, restaurants and on our high street.
As the largest manufacturing sector in the UK, we are an essential lynchpin for a successful and vibrant economy, long-term prosperity, driving growth at home and abroad and supporting thousands of jobs.
There are three key areas where our industry wants to work with government. We believe these will drive economic growth, productivity and, within this, environmental sustainability, and exports too, while easing inflationary pressures.
1. Boost productivity and stimulate business investment
- Make permanent the 100% first year capital allowance
- Review the R&D tax credit system
- Reform the Apprenticeship Levy
- Widen the scope of the Shortage Occupation List review to include acute shortages at all skills levels and greater flexibility on the salary thresholds to help ease immediate pressures
- Establish a similar scheme to the Reformulation for Health Programme and support smaller businesses to access technical support and trial new innovative solutions that can improve the health of products.
- Reduce inflation by supporting the food and drink industry to help manage high energy costs
- Support food and drink to invest in energy efficiency and decarbonisation
2. Prioritise regulatory reform
All too often businesses in our sector are grappling with regulation which is overly complex or risks failing to meet its stated aims. Our sector is highly regulated – rightly so – and as such British food and drink is prized for its quality and safety. However, shoppers end up paying the price for poor regulation when this drives up costs and those costs have to be passed on.
- Extended Producer Responsibility (EPR) is the set of policies that, if implemented correctly, will ensure manufacturers (or producers) take responsibility for managing their packaging waste and that the UK establishes a world-leading recycling system for plastics and packaging. Producers, therefore, have a clear interest in ensuring the system works – that is, in a way that’s good for the environment, for businesses and consumers. Current policy proposals will not create an efficient and effective EPR scheme, nor attract investment, and will cost households over £1 a week.
- Without large scale chemical recycling taking place, it will be impossible to supply sufficient recycled packaging content to the market. ‘Mass balance accounting’ is needed to unlock the potential of chemical recycling and immediately introduce this measure rather than delaying for several years.
We think the UK can unilaterally act to drive substantial improvements for businesses at the border, boosting the competitiveness of our exporters and ensuring access to the ingredients and raw materials businesses need to import if there is a single Government border approach to underpin the single window.