New immigration rules set to lower farmgate prices and increase production costs

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Farmers are set to be hit with a double whammy of lower farmgate prices and higher costs of production as a result of the Government’s proposed immigration rules.

Under the new points-based system, anyone wanting to work in the UK would need a job offer with a salary of at least £25,600, though those taking up work in a profession where there was a skills shortage, as identified by the Migration Advisory Committee (MAC), could earn as little as £20,480.

This would mean farmers and those higher up the food supply chain having to pay their staff more, or invest in expensive and sometimes unproven automation processes, with low profit margins and at the same time direct payments are slashed.

Nick Allen, chief executive of the British Meat Processors Association, said the proposals risked making processing plants ‘unviable’.

But he warned there was a more pressing danger processors would slash prices paid to farmers in an attempt to recoup their losses.

“There are a phenomenal number of people working away on the boning line, and if you find you have got to pay them £10,000 a year more, that has got to be recovered from somewhere,” he said.

“The likelihood is the cost probably goes back to the farm end, because consumers never seem to be the ones who pay more for these things.”

 

Abi Kay

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