UK food bills hit US$7.36 billion after Brexit

A study released Thursday said household food bills increased by 210 US $257 in the two years to the end of 2021 after Britain exited from the European Union, adding nearly 6 billion US $7.36 billion to consumers' food bills.

The LSE noted in the report that food prices were pushed higher by the rising cost of extra checks and requirements on EU imports.

The LSE judged thatBrexit started ramping up food bills from late 2019 onwards, as firms anticipated higher costs and adjusted prices accordingly.

It added that products' price increased by six per cent over the two-year period.

The poor are most affected by the hike because people on low incomes spend more money on food than richer people.

After leaving the EU, the UK swapped a deep trade relationship with few obstacles to trade for a wide range of checks, forms and steps are required before goods can cross the border, said Richard Davies, a Bristol University professor and study co-author.

Firms faced higher costs and passed most of them onto consumers. Britain has been a victim of a worsening cost-of-living crisis this year as inflation surged to multi-decade peaks, sparking a wave of strikes across the economy as pay fails to keep pace.

Consumer prices have been propelled by rocketing energy bills after key producer Russia invaded Ukraine, and rebounding demand as the Covid epidemic recedes.

The inflation rate in the UK rose above 11 per cent in 2022, the highest rate in 40 years, Davies said.

Many factors are involved in supply and demand for goods and services.

There has been a rise in non-tariff barriers for trade with the EU as a result of this high inflation. Britain withdrew from the European single market and customs union at the beginning of 2021 after voting in favor in a 2016 referendum.

London then signed a post-Brexit Trade and Cooperation AgreementBrexit Trade and Cooperation Agreement with Brussels, which maintained largely tariff-free trade with the EU's remaining 27 members.

There was a significant increase in costs, red tape and border delays for companies.