LONDON — Soaring costs associated with Brexit could claim yet another victim, the humble full English breakfast, according to a new analysis from KPMG.
Working on the basis of Britain leaving the European Union without a trade deal and reverting back to WTO rules — a possibility Prime Minister Theresa May says is possible, frequently saying “no deal is better than a bad deal” when it comes to Brexit — KPMG has calculated just how much the price of the UK’s iconic breakfast could increase.
Accounting for all ingredients, KPMG estimates the cost of a fry-up could increase from around £23.60 now, to £26.61 after Britain leaves the EU, a rise of close to 13%.
That might seem like an expensive breakfast, but KPMG’s estimates are based on buying things like a full carton of orange juice, a bottle of olive oil, and a packet of sausages, rather than just enough to make a single portion of a fry-up.
The estimates shed light on just how big the tariffs placed on consumer goods would be and how much Brexit will cost regular Brits if the UK does not manage to secure an effective trade deal with the EU before it leaves the bloc. It also illustrates quite how reliant on overseas food and goods the British economy is.
“Our analysis does not even reflect the steep costs consumers and retailers are already facing as a result of the pound sterling’s devaluation or the costs of any new non-tariff barriers,” said Bob Jones, a director at KPMG said of the firm’s findings.
You can see KPMG’s handy infographic below:
KPMG’s analysis comes just after Justin King, the former CEO of grocery giant Sainsburys said that UK shoppers are “completely in the dark” about what Brexit will mean for supermarkets.
“One can say very clearly what the direction will be: higher prices, less choice, and poorer quality, because all of those dimensions have been improved by these open trading relationships that we’ve had over the last 40 years,” he told the BBC’s Panorama programme.
“Brexit, almost in whatever version it is, will introduce friction, it will introduce barriers. That makes it less efficient, which means all three of those benefits — price, quality, and choice — go backwards.”
Earlier on Monday, research from the British Chambers of Commerce showed that just 2% of businesses believe that a no deal outcome for the UK would be acceptable.
“‘No deal’ isn’t seen as a viable option. Businesses want a pragmatic settlement on the practical, real-world issues that affect their operations, not arbitrary political red lines,” said Dr Adam Marshall, the BCC’s director general in a statement alongside the findings.