UK shoppers to face higher prices and less choice if thorny issues from Brexit not resolved

Shoppers in the UK could face higher prices and less choice unless the UK and the EU can agree how to handle thorny issues like haulage and food safety after Brexit, an industry body said on Wednesday.

While the UK government has broadly spelt out its vision for a future customs agreement with the EU, according to the British Retail Consortium, it was still waiting for crucial details around the trade of consumer goods.

The agency has called for significant investment in ports and transport infrastructure so that new systems are in place when Brexit happens in March 2019, as also agreements to prevent goods being held up at the border due to extra checks.

''Whilst the government has acknowledged the need to avoid a cliff-edge after Brexit day, a customs union in itself won't solve the problem of delays at ports,'' said BRC chief executive Helen Dickinson, Reuters reported.

''So to ensure supply chains are not disrupted and goods continue to reach the shelves, agreements on security, transit, haulage, drivers, (sales taxes) and other checks will be required to get systems ready for March 2019.''

The BRC report comes as the latest of several appeals by industry groups for greater clarity about how trade and immigration will operate in practice after Brexit.

Meanwhile, prices are set to increase as businesses which were protected against the fall in the pound  face are exposed to the weaknesses of the currency.

''On the one hand, retailers face continued pressure from rising sourcing costs from the Brexit-induced fall in sterling. On the other, operating costs from rising staff wages, business rates and retail rents are also heading higher,'' said Richard Lim, chief executive of Retail Economics, The Telegraph reported.

''The combination of these pressures has eroded profit margins and retailers are having to pass through some of these costs to consumers.

"What's more, against a backdrop of slowing consumer demand the trading environment for retailers in the second half of the year will be extremely challenging.''