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The UK spends billions, stockpiles for chaotic Brexit that may never happen

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Image: Trucks at the Port of Dover
A truck is driven past dozens of others parked after traveling by ferry from France to Dover, England. -
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Toby Melville
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LONDON — In the spare bedroom of Sarah Cuffe's house are piles of food and toiletries. Natural disasters don't hit the English county of Hertfordshire very often but it looks like she's ready for one.

"Just in case the worst comes to the worst, we thought we've got a spare bedroom, so why not stockpile stuff like pasta, tinned tomatoes [British for canned tomatoes], things aren't going to go off," she told NBC News.

"We've got loo roll [British slang for toilet paper], cleaning products, multivitamins and nuts for protein."

But the mother of two isn't getting ready for a hurricane. Instead, she is one of the many Britons stockpiling goods in case of the most chaotic and unpredictable Brexit outcome: The United Kingdom leaving the European Union without a negotiated withdrawal agreement.

A "no-deal" Brexit — which is scheduled to happen on Friday, April 12 if 27 EU leaders don't unanimously agree to delay the process further — would leave the UK floundering without any international trade agreements, potentially causing huge delays to imports and exports of commodities, consumer items and medical supplies.

If the supermarket shelves end up bare as a result, Cuffe says her stockpiled food can keep her family going for about a week. Some hard-line Brexit supporters, including members of Prime Minister Theresa May's Cabinet, think the threat of leaving without a divorce agreement is overblown. But that hasn't stopped the government from setting aside £4.2 billion to spend on preparing for the worst.

Lord Kerslake, a former head of the civil service who is not known for exaggerating, this week said that the Brexit crisis represents the country's biggest peacetime emergency.

So just how ready is the U.K. for a "no-deal" clean break?

Food fight

The U.K.'s food supply chain is a delicate balance of transport and storage — the trick is to only hold as much stock as you're going to immediately sell, so much of it arrives just in time to be sold. Many in the industry fear big shortages in the event of a "no-deal" Brexit. No deal will inevitably mean more customs checks and more delays at the border. More delays mean more empty shelves.The U.K. only makes about half the food it consumes, with some 30 percent coming from the EU. The country particularly relies on European producers for soft fruit and vegetables — up to 90 percent of lettuce on sale in British shops is from the EU depending on the season.

The British capital's largest cold storage facility has been full for most of the last 18 months, as retailers and transport firms prepare for the worst.

"Mainly in our industry, there tends to be a big increase in demand in the summer and in the run-up to Christmas," said Danisha Jagatia, commercial manager for Transkold, which operates the site in the Stanmore area of north London.

"However, with all the uncertainty with Brexit, we have found that a lot of our existing customers have been bulk-ordering from Europe in the last few months. We've had to increase our staff levels."

Transkold has space for 2,000 pallets of fruit, vegetables, baked goods, ingredients and other items, which have to be stored at 7 degrees below zero. It has no more space to offer major retailers and supermarket chains looking to stockpile ahead of Brexit.Jagatia admitted this was "a good problem to have" but added the company regretted having to turn new business away.

The demand isn't all coming from the UK — EU transport firms which regularly bring goods across the English Channel are asking for increased storage too. And then there are luxury goods. Fortnum & Mason, the high-end department store in London's West End, has been stockpiling hundreds of thousands of bottles of Champagne.

The retailer has a contract to provide gallons of the stuff to the Chelsea Flower Show in May — and while the store sources 86 percent of its products from the UK, Champagne can only be made in a single region of France.

"Just in case there were significant delays at ports as a result of Brexit, that we ought to increase our cover by about an extra month's supply, so didn't sell out," Fortnum & Mason CEO Ewan Venters told TalkRadio on Thursday.

"The Holy Grail of retailing is you don't want to hold more stock than you need to — but given the high-profile nature of that event, we genuinely thought it would be important to hold a few more weeks' stock just in case.

"The list goes on. A British chocolate maker has spent £150,000 stockpiling Brazil nuts and ginger, while a bed maker has spent £250,000 on extra materials — just in case.Medical concernsSomewhere in a warehouse in Belgium, there are thousands upon thousands of packages of drugs and medical supplies waiting to be shipped to the UK in the event of a "no-deal" Brexit.

The government has established new shipping routes and commercial contracts just for this purpose, at a cost of £88.8 million over six months. More urgent deliveries will go by plane.

This "logistics hub" is just one part of the government's intricate and expensive attempt to prevent disruption to patients' lives. Some medicines, such as insulin, are not made in the U.K. and the country squarely relies on its frictionless trade with the E.U. for its supply.

Prime Minister May is a type 1 diabetic.The Department of Health and Social care has said it is confident normal service will resume, but has pointedly refused to give any guarantees.The government's efforts have been impressive, according to Martin Sawer, executive director of the Healthcare Distribution Association, but as long as the possibility of a "no-deal" Brexit remains, so does the potential for chaos in medical care.

"There are always challenges, and we're worried that we're going to see that on a bigger scale because of no deal," he told NBC News. "Problems won't necessarily arrive on day one, it's more likely to be a few more weeks down the line."World news

Sawer added: "These new shipping routes are untested, there are 8,500 medicines that we've been stockpiling, and it only needs one patient somewhere to not get something for it to be a problem."Pharmaceutical suppliers are used to big spikes in short-term demand — but perhaps not anything on this scale.

"Obviously we've had incidents in the past, like the Manchester bombing or the London bombs, where we've had to operate with a police escort to get medicines around — so you can imagine all that sort of thing would have to happen if we had a crisis and of course it could be multiplied by 10 compared to what we're used to," Sawer said.

Toby Melville
A truck is driven past dozens of others parked after traveling by ferry from France to Dover, England.Toby Melville

When NBC News asked about the latest no-deal preparations, a spokesperson for the Department of Health and Social Care pointed to a written ministerial statement from February.

Asked exactly how many body bags the government had stockpiled ahead of Brexit, the official said this couldn't be revealed because it was "commercially sensitive."

Ironically, given the economic shock even ardent Brexiteers admit would hit the UK in the event of no deal, there is a short-term benefit from producers stockpiling so much stuff: A key manufacturing indicator, the purchasing managers' index, shot to a 13-month high this week.

But business leaders are now worried that these mountains of stock may have to be heavily discounted in future if a withdrawal agreement is passed.