If the Common Agricultural Policy is complicated and often devoid of logic, it is the essence of simplicity compared to the EU’s Common Fisheries Policy.
It has managed to undermine the fishing industry, certainly in the UK, while doing little to conserve fish stocks or protect them from industrialised boats from other EU member states. This was why the fishing industry voted to leave the EU, but this week they were delivered a reminder of bigger political issues in play. That came in the shape of the government agreeing to stick with the rules of the CFP for the 21-month transition period after Brexit. That is a huge slap in the face for an industry that had its hopes set on finally escaping a policy that has driven its decline for decades.
What, you may be asking, has this to do with farming. The answer is that there is a danger of fishermen and farmers being seen the same way at Westminster. Back in the 1970s, when the prime minister, Edward Heath, was negotiating membership of what was then the EEC, he reportedly described the fishing industry as ‘expendable’ in the context of the deal he wanted. It is clear that some at Westminster still believe this to be the case, as witnessed by their dashing of the industry’s hopes for Brexit. It is not too big a leap to see the danger of farming being seen the same way by some politicians.
This could easily apply when it comes to trade deals, and that danger was highlighted in a report from the Institute for Fiscal Studies. It looked at a post-Brexit situation where the UK scrapped all import tariffs, including those that protect industries such as farming from global competition. That is not a risk within the EU, because it has tariff barriers as part of its protection of the current 28 member states. However the UK has said it wants to be a free trading nation, and the IFS report was looking at the impact on consumer prices of removing all protection. It said such an approach would increase prices by just over one per cent, which is well below the impact we have seen from the weakness of sterling.
Farming is one of the protected industries that would suffer. Indeed part of the reason prices would not rise would be because imported food would be cheaper. The government has said it will not allow imports that do not meet UK rules, but then in the past it also promised to protect fishing interests. There is a real danger that farming will be viewed as ‘expendable’ in the drive to secure global trade deals after Brexit. With the transition set to last until December 31 2020, the government will be under pressure from March 2019 onwards to deliver headline grabbing trade deals.
The comfort blanket for the farming industry is that agriculture and food are key parts of the UK economy. That is true, but farmers must not allow that to cloud their natural mistrust of politicians. The UK food industry would employ just as many people if it processed imported food. This makes farming much more vulnerable to ministers making decisions on an ‘end justifies the means’ basis. People’s big concern is with the price of food. Provided that stays low, as it is now, the majority will not mind where food comes from. If major retailers guarantee quality and wholesomeness that will satisfy most people.
The food industry has given a guarded welcome to the transition deal struck between Brussels and London. They would have liked a longer transition than 21 months, but with that set it does at least give the industry a target around which it will have to plan. In return it needs assurances from Westminster that it will finally stop playing politics and get on with the game. The message from the farming and food industry is that they are not interested in politics, but want to know how the government is going to make this work, and how it will maintain the 70 per cent of our export trade that goes into the EU-27. These are real decisions for the real world. They are not knockabout politics for those who believe leaving the EU will in itself forge a successful economic future. That can happen, but it will not be an automatic process. It needs to be driven by wise, rather than hot heads.