Liberal Democrat politician Nick Clegg has warned that UK food prices will see a steep hike if the government opts for a hard Brexit and leaves the Single Market.

Launching the latest in a series of reports on Brexit, the Liberal Democrat EU spokesman spelled out how leaving the EU and reverting to World Trade Organization (WTO) trading rules would have serious consequences for British consumers and the farming industry.

The government can take steps to prevent this ‘cliff edge’ by either keeping the UK in the Single Market on a permanent basis; or seeking a transitional deal based on the Norwegian model that would maintain membership of the Single Market until a new trade deal with the EU is negotiated.

Businesses have already seen the cost of key imported raw materials rise by around 20% this year. Scottish shortbread maker Bill Dean warned that he would raise prices or lay off workers due to a 75% increase in the cost of butter since the referendum – a combination of the drop in the currency and fluctuations in the commodity market.

Nick Clegg commented: “It’s clear that Marmite was just the tip of the iceberg. A hard Brexit will lead us off a cliff edge towards higher food prices, with a triple whammy of punishing tariffs, Customs checks and workforce shortages.

“The only way the government will be able to avoid this outcome is if it maintains Britain’s membership of the Single Market. We must hold Theresa May’s government to account and fight to ensure what comes next is best for British consumers and farmers.”

For each of the UK’s top 10 food and drink exports to the EU, the imposition of the EU Common External Tariff on imports from the UK will mean that companies will have to pay the following average tariffs in order to gain access to the European market: bread and crispbread companies such as Jacob’s and Ryvita’s equivalent tariff will be between 10% and 40%.

UK farming will be badly hit by tariffs, with arable producers facing levies of 40% on unmilled wheat.