Government must recognise farming’s economic importance as the bedrock of the UK’s largest manufacturing industry – food and drink – worth £108billion and employing 3.9million people, NFU President Meurig Raymond told Farmers Club members at their post-AGM luncheon at the Royal Society of Arts on July 5th.
Speaking just after launching the NFU’s national consultation and on the eve of a Westminster address to MPs and Lords, he admitted he was shocked by the Brexit vote. “It was a huge step for the British people and when you just consider what is happening at the moment, it is uncharted waters with a huge political vacuum, so who knows what the consequences of this are going to be.”
Key to farming’s prospects would be the personnel in Government, he stressed. “It is the understanding of whoever becomes Prime Minister, and whoever is going to be sitting around that Cabinet table, maybe by mid-September, that is going to have a huge bearing.”
The industry had been fortunate in recent years, he suggested. “I got on exceptionally well with Liz Truss, she understands farming and food production. Own Patterson before her, we owe him an awful lot, he had the courage to actually push that pendulum back towards production agriculture, and on issues like bovine TB he was again determined, he knew what was required if we were going to eradicate TB.”
Whether such people would be in a future Cabinet was impossible to know. So he urged members to challenge whoever was going for leadership roles, to see where food and agriculture sat in their priorities.
“We, all of us, in the weeks and months ahead, have a huge responsibility to show the decision makers the huge economic importance of food and farming. Liz Truss said on numerous occasions that the food and farming industry was bigger than the motor manufacturing and aerospace industries put together. Getting that message through to policymakers is key.”
With the European Commission scheduled to be in place until November 2019, and the European Parliament in place until early-summer 2019, it made sense, from a farming perspective, for the Article 50 exit procedure to be triggered in mid-2017, so a mid-2019 exit would coincide with the end of the current round of EU farm support.
He noted that EU Agriculture Commissioner Phil Hogan had given a reassurance that British farmers would continue to receive their support payments for as long as the UK was a member of the EU.
NFU Council has agreed seven Brexit goals, which are now being consulted on, to ensure a robust policy document can be put to UK government by mid-October:
Best possible access to European markets, which will remain the UK’s major trading partner for the foreseeable future.
Assurance that the UK is not open to imports produced to lower standards.
A new domestic agricultural policy adapted to UK needs, easy to understand and simple to administer, including guarantees that support for farmers is on a par with that given to farmers in the EU, who will remain key competitors.
Benefit from more than 50 trade agreements with countries in the rest of the world, which will be needed in future, whether new deals need negotiating or not.
Access to migrant labour, seasonal and full-time, maybe via a student agricultural workers scheme, open to students from around the world.
Rural development policy focused on enhancing competitiveness.
End to onerous regulations and over-politicised approach to product approvals, including excessive use of the precautionary principle. Brexit provides a golden opportunity to ensure arrangements are proportionate and based on sound science.
The Brexit vote did not mean farmers could now bury their own deadstock, nor that sheep EID could be scrapped, or that any of the other EU regulations could be ignored, he stressed. Instead, the industry needed to unite to agree the best way forward, including the most beneficial access to the single market, a fresh farm policy, and reworked regulations, all of which needed to best serve farming once the UK had left Europe, which he felt it would do. “We have to be credible in this – hence the consultation across the country.”
Crucially, the debate was about a lot more than Europe protecting exports of German cars and French wine. EU policymakers were terrified of a contagion within Europe and political collapse. Negotiations would be less about trade, and more about Europe avoiding a ‘nightmare scenario’ of the UK leaving and then securing a free pass back into the single market. “That is what we’re up against. Anybody who believes we have a good hand of cards in these negotiations is absolutely mistaken.”
While Sterling’s loss of value could help exports, imports would become more costly. At worst, exports of UK farm produce to Europe could be hit by 8-12% tarrifs, whilst Government at the same time opened the doors to food imports to dampen food price inflation.
The decline of UK farming productivity meant nearly 40% of food was now imported. “There is a message here that security of supply in these uncertain times is important.”
A lack of non-British labour would have a huge effect on many farming sectors, potentially forcing businesses to locate to other parts of the world, and import produce back into the UK.
Future farm policy, for an independent UK, needed to be simpler to operate, easier to understand and fair in its level of support payments. “It’s not about the size of that support, but about not being disadvantaged, compared with competitors like Ireland, Holland, Denmark or Spain.”
Licensing of active ingredients would need to reflect science not emotion. An end to state aid rules should mean a big opportunity for more public procurement of UK produce, he added.
“It’s going to be interesting, it’s going to be exciting, I just hope it is going to be fruitful, and that is the challenge we all face over the next few years, to end up with a profitable, competitive, efficient industry that can increase production and improve our self-sufficiency in food.”
One widely-approved view from the audience was that never in living memory had the NFU been more important in taking a leadership role, and indeed in leading Government itself.
It was also suggested that the industry had a great opportunity to provide the brightest and best expertise to help Government review the myriad EU regulations. The alternative was non-agricultural consultants, like Deloitte or PWC, stepping in. The Strathclyde Food Project [aimed at reducing the UK’s food and drink trade gap] was a prime example, in which industry experts had helped identify what was needed to improve competitiveness.
By way of conclusion Club Chair of Trustees Julian Sayers noted that The Farmers Club had an important role to play in facilitating apolitical debate, and now had wonderful facilities for the many, many meetings that would be taking place over the coming months and years.