News
18th Nov

2019

Warm Words Butter No Parsnips for Agricultural Policy

This is the full (unedited) piece, written by George Dunn, TFA Chief Executive, for The Cumberland News and Westmorland Gazette, published on 25 September 2019.

Warm Words Butter No Parsnips for Agricultural Policy

 

Repeatedly we have heard Government Ministers pronounce their support for the agricultural industry and that everything will be done to support the future sustainability of our farm sector – particularly protecting it from unfair competition from abroad.  This mantra was recently put to the test when the Government decided to issue its revised tariff schedule for imports of agricultural products and foodstuffs.  Sadly, the Government failed the test.

Whilst the tariff protection announced for beef, lamb and some dairy products is to be welcomed, the Government has left other sectors completely exposed by deciding to apply a zero tariff to imports of commodities such as cereals, eggs, potatoes and skimmed milk powder.  With over 90% of our bread using British wheat, the egg market already oversupplied with international producers continuing to use cages banned in the UK and dairy farmers currently under pressure, the decision of the Government makes no sense at all.

So far, the Government has failed to publish the economic analysis it has used to underpin its decision-making.  However, it doesn’t take much to reach the conclusion that we are creating a huge risk of damage to our domestic interests if these tariffs are applied.  Whilst the concern not to create a negative impact on consumers is understood, it is difficult to see how applying reciprocal tariffs on these commodities would have the negative effect the Government might fear.  Instead, the Government should be taking the precautionary approach of applying reciprocal tariffs and reviewing them against the evidence of impact upon consumers.  Moving ahead with a zero-tariff regime in these areas immediately could mean that we lose significant capacity at home which we will never get back.

A closely connected policy area here is the Government’s position on standards.  We have heard repeated assurances from Government Ministers that the UK will not import food and food ingredients produced to standards that are illegal in the UK.  However, to date, there has been a failure to commit to legislation in this area.  In a recent meeting with the DEFRA Secretary of State, the TFA was told that the Government was not going to tie its hands in trade negotiations by introducing a legislative commitment in this area.  Given the Government’s decision on tariff schedules, we can be justifiably concerned that their assurances in respect of standards will also come to nothing.

As we head towards the third UK General Election in five years.  Agriculture, will once again, feature heavily in the policies of all the Political Parties.  Whether it is about animal welfare, climate change, health and well-being, environmental standards or obesity, there will be much to say about the role that agriculture has to play in meeting the challenges we face in all these important areas.

The central issue that must be addressed is how to find a way for farming to deliver safe, high quality food produced to high standards of animal welfare and environmental management at prices consumers can afford whilst providing a sustainable return to the farming community.  Indeed, this conundrum was set at the heart of the objectives of the Common Agricultural Policy as set out in Article 39 of the Treaty of Rome.  Add to that the multifunctional benefits that society now demands of farming in the areas of public access, carbon storage and sequestration, biodiversity, clean air and water, landscape improvement and renewable energy – we need to radically review our thinking.

So often castigated by the media as being part of the problem, agriculture is in fact much more about the solutions.  The concept of “polluter pays” has become ingrained in the minds of policymakers in recent times and the temptation has been to point the finger upstream in the supply chain.  However, if retailers and food service providers are continually discounting prices to consumers, robbing returns to primary producers, maybe it is at the consumer that we need to point the finger when things go wrong in the supply chain.

However, successive Governments have made it their goal to keep a lid on food prices in order to control inflation and to protect consumers in periods of wage stagnation.  Indeed, many champions of Brexit have talked openly about the benefits of lower food prices outside of the European Union.  If that is where the rubber hits the road, then the UK Government must accept that support for agriculture from the public purse will need to remain as a central budget line for public spending for years to come.

Our annual spending on the National Health Service is expected to be around £134 billion in the current financial year.  By comparison, support for UK agriculture represents less than 2.25% of this massive budget.  How much could be saved from the NHS budget if we were able to reduce demand for its services by keeping people out of our doctor’s surgeries, hospital waiting rooms and operating theatres through encouraging healthier eating and healthier lifestyles?  Reconnecting consumers with their food and with the farmed environment will be key.

There is nothing wrong with the ingredients that UK agriculture supplies whether that is red meat, white meat, eggs, cereals, or fruit and vegetables. We need to see public support for agriculture as an investment in our long-term health and well-being.  So rather than talking about cutting payments to agriculture why don’t we start arguing for increasing levels of support in targeted ways that will meet our wider objectives for economic, environmental and social sustainability?

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