Brexit is a high stakes game for the farming industry in the UK.
It would be welcome news if a report finally came out showing how agriculture might gain financially, but yet another report this week has painted a bleak view of prospects. This comes from the levy collecting Agriculture and Horticulture Development Board (AHDB) and it looks at three possible outcomes.
The base line for the report is a current average UK farm profit of £38,000. The outcomes considered by AHDB were firstly effectively ‘business as usual’ where support continues at the present level and trade is not disrupted. That, it acknowledges, is an unlikely outcome, since the government has only guaranteed to maintain farm support at present levels until 2022. On top of that we now have the government talking about a no deal exit from the EU.
The second option is the least attractive. It is that subsidies are eliminated and the government gives tariff free access to food from other countries. The elimination of subsidies seems unlikely, even in the long term. But the government has been hinting this week about setting a global example for free trade by allowing post-Brexit imports without tariffs. Under this option farm incomes are more than halved to just £15,000.
The third option is trading on the basis of World Trade Organisation (WTO) tariffs, with a big cut in subsidies. That is a very real possibility. The Chancellor acknowledged this week that walking away from the EU on a no deal basis would be costly, because the government would have to step in to support the economy. That would make farm subsidies less affordable. Under this scenario farm incomes would fall to £20,000, with beef and sheep taking the biggest hit.
These are just three of many possible permutations, and DEFRA in London has dismissed the AHDB report as one that does not reflect what is likely to happen. It does not however set out its view of the future, beyond claiming that freedom from the red tape of the CAP will create a more dynamic industry. It also says the AHDB report does not reflect the government’s negotiating position with the EU. However events this week have underlined the huge disconnect between the government’s negotiating strategy and what the EU will deem acceptable as the basis for a deal. This makes the AHDB report more realistic, on the strength of where negotiations with Brussels stand.
If the government and the advocates of Brexit believe the AHDB report, and others that are equally pessimistic, are wrong it would be a big help if they would set out a more positive vision of the future. This would be about creating a profitable industry, free of red tape and embracing science to be globally competitive. This is what farmers were promised last year when many were successfully wooed to vote for Brexit. Instead the industry is suffering, like the rest of the economy, from political drift.
When they were campaigning for Brexit its advocates, led by the now DEFRA Secretary, Michael Gove, set out a vision of a competitive, profitable agriculture freed of red tape from Brussels. That they succeeded in doing so was evident in the number of farmers that voted to leave. However the vision of then is sadly lacking now. Gove might ultimately do some of the things the industry needs, but the vision and fire for action is not the same as it was last year.
This is evident in comments on social media and elsewhere from farmers enthusiastic about Brexit. They want to see something other than constantly negative reports about the potential impact on agriculture. They need someone from the leave side to show some enthusiasm for a thriving post-Brexit agriculture. They could talk about freeing it from regulation, embracing science and technology and making profit and global competitiveness central to farming again. They could remind people that it was British farming know-how that developed agriculture in many countries around the world, and that freed of the dead hand of the CAP the industry could again be world class. The referendum and debate is over - everyone, leave or remain, has a vested interest in seeing a thriving future for agriculture after Brexit. On that basis, it would be good to have someone putting forward an alternative to the endlessly gloomy, but seemingly realistic, assessments now emerging.