Britain and Europe

An apple a day could keep the Brexit blues away for Britain’s farmers

29 January 2018

To make sure Brexit doesn't cause chaos for British farmers, the government needs to take a serious look at reforming agricultural subsidies

Charlie Cadywould

Our politicians have hidden behind Brussels to avoid tricky issues for the best part of half a century. ‘Taking back control’ after Brexit, for all its challenges, means ministers will finally have to step up, not least on agricultural policy where EU subsidies and regulations have dominated for so long.

But like blue passports and the threat of nuclear Armageddon, farming’s making a comeback, at least in the halls of Westminster and Whitehall. The ‘Green Brexit’ reform agenda set out by Michael Gove earlier this month won plaudits, but there is a more efficient, socially just way to safeguard the sector – and the rural communities behind it – for the long term.

Almost everyone agrees: the existing system of farming subsidies has to go. Brexit, for all its challenges, gives us that opportunity. By basing payments on the amount of land owned, there’s no requirement to ‘farm’ in any common-sense understanding of that term in order to receive money. Analysis by Greenpeace showed that 16 of the largest 100 payments in 2015 went to organisations owned or run by people featured in the Sunday Times Rich List, including billionaires like Sir James Dyson, the Duke of Westminster, and Price Khalid Abdullah of Saudi Arabia.

We could, instead, pay farmers for what they produce but that led to the ‘butter mountains’ and ‘wine lakes’ of the 1980s. We could stop subsidising farming altogether, but that would put our farmers at a disadvantage because our nearest neighbours aren’t going to stop any time soon.

Michael Gove has a plan: throw all farming support into payments for the provision of what he calls ‘public goods’. No one disputes the importance of environmentally responsible practices, nor the need to put the right incentives in place, but farming is a loss-making enterprise. The government can pay farmers to plant trees, improve public access, or take on some of the burden of moving to organic or zero-tillage practices, but if it doesn’t pay to grow crops or rear livestock, people will stop doing it.

So here’s a different, more radical idea to change how we support British farmers.

Instead of giving people money for owning land or producing more than the market wants to buy, let’s put those resources into the hands of ordinary consumers. Give every household in the country a voucher to buy British produce.

For those in favour of a universal basic income, it’s a first, if small, step in the direction of ensuring every family is able to afford basic necessities. It does so without the inefficiencies of complex bureaucracies that affect many other redistributive policies.

At the same time, it gives British farmers, as a collective but not as individuals, a guarantee that there will be a demand for their products. Britain retains a domestic source of food supply – in turn giving certainty to the food processing industry, which contributes a fifth of the UK’s manufacturing output – and ensures the continued existence of a distinctive feature of Britain’s rural way of life, without shielding individual farmers from competition.

It sounds like a protectionist move, but it’s just a reallocation of money already allocated towards protectionist ends. If it replaced Britain’s contribution to those land-based, direct payments to farmers, it would equate to around £200 per household per year – just 7% of what we typically spend on food.

Using the security of this demand (and the guarantee of supermarket space), and backed up by other policies like R&D funding and finance for investment, UK farmers should be able to become more competitive for the rest of our spending on food, as well as exports. Foreign producers exporting to the UK wouldn’t be unfairly disadvantaged, though, particularly as many of them would still be directly subsidised, and British consumers would still be able to benefit from cheap, subsidised imports.

Of course, it’s not without potential stumbling blocks. In practice the EU would need assurances that they wouldn’t be adversely affected, and it would need to be navigated carefully through the WTO. And how would we define British produce? If it’s about the source of raw ingredients, the system would get complicated pretty quickly when we start thinking about things like ready meals, sauces and pies.

An easy option, that might also help to meet public health goals, is to limit the voucher’s use to fresh, unprocessed food, but that might end up excluding a lot of farmers from the potential benefits. We’d probably want to include bread at the very least, but we probably couldn’t include scotch whisky, tempting as it might be.

So I’m branding it the ‘apple’, our healthy, affordable, national fruit. It’s patriotic, but not protectionist; market-oriented, but progressive. It can promote productivity, but if combined with strong environmental incentives and responsible land management, need not compromise on sustainability, and helping farming activity that we value, but which could not compete in an open market. Most of all, it protects the agriculture sector and Britain’s rural heritage, whilst helping poor urban families with their weekly shop too.

An apple a day can’t always keep the doctor away, but this one will keep our farmers going through the Brexit headwinds.

Charlie Cadywould is the author of new Policy Network report, The Future of Farming

Image credit: Prostock Studio / Shutterstock.com