Tom Clarke is a former Local Govt advisor and management consultant who has run his family’s farming business in Cambridgeshire since 2009.
Modern British farming is far from the ‘Old MacDonald’ and ‘get orf moi laand’ stereotypes. Brexit heralds the potential restructuring of a sector which underpins the £108 billion food and drink manufacturing industry (our largest) and provides 3.9 million jobs.
For the past 40 years, this most basic of our industries has been exempt from political debate. Whatever Government was elected, and however people voted, farming was under the control of the EU’s Common Agricultural Policy or ‘CAP’. Today that CAP makes our countryside look and work the way it does, much more so than the free market. But the British people, and the political parties, have had little or no input into this, and farmers haven’t had to make their case.
Farmers generally produce bulk global commodities (milk, wheat, sugar, barley etc) over which they have no pricing power – they are in a weak economic position. They are at the mercy of their suppliers, too. The large chemical companies and machinery manufacturers quickly crank up their prices after a good harvest, eliminating the farmer’s bonus. Furthermore, a seed put in the ground will not result in revenue for between one and two years afterwards. A lot of weather can occur around the globe in that time – which is why unregulated agricultural markets are so volatile. Prices can double or halve on an almost quarterly basis. There are 140,000 farming business in the UK and 90 per cent of these are family-owned – not necessarily the most nimble or deep-pocketed of enterprises.
The EU’s response was to spend £3 billion on UK farmers, paying 75 per cent of this directly into our pockets, with 20 per cent channelled to environmental schemes and ‘worthy’ projects. A mere five per cent of this sum is spent on investment to make the industry more competitive and productive. In return, relatively few farmers have gone bust, but they have to put up with petty-fogging bureaucracy, perverse incentives and the EU’s unscientific restrictions on new technology and techniques. UK agricultural productivity has largely flat-lined since 1990.
Is farming just another state-subsidised industry ripe for liberalisation, or is the strategic value of our food supply and the look of our countryside more deeply woven into our national equation?
What is the Conservative approach to this? We haven’t had to think of our own national food and countryside policy for over 40 years – and the world is a very different place now. Whatever the outcome I believe farmers have to begin a conversation with the voters, and politicians – and the first thing we need to do is challenge the old stereotypes by putting forward three new ways for the general public to view farming.
1) Farmers are national security operatives
What is food security? The UK produces 61 per cent of our own food, down from 75 per cent in the 1980s. Put basically, of your three meals a day we grow your breakfast and lunch, but you have to import your dinner. If we hadn’t imported any food this year the NFU calculates that we’d have run out on August 9th. Increasingly farms also grow energy crops and support solar and wind generation – so we have a role in energy security too. Of course we’ll never be self-sufficient in things like bananas, nor should we try, but to be secure our food exports should at least be able to cover our food imports.
2) Farmers are high-tech, world class exporters
Post-Brexit Britain is going to have to pay its way in the world. We can’t afford to leave any stone unturned so – for any International Trade or Brexit Secretaries prepared to sacrifice farmers on the altar of financial services or Nissan – it is worth emphasising the export potential of our largest manufacturing industry. Vast swathes of growers – particularly of fruit and veg – use top end science and business practice to produce world class, competitive products without ever having relied on CAP payments to make ends meet. The challenge is to spread that entrepreneurial knack to the benefit of our balance of payments, not undermine it. A greater focus on agricultural productivity could reap huge benefits.
To win new friends and influence, the UK should consider joining the Cairns Group. 20+ countries including Canada, Argentina and Australia who try to negotiate on world agriculture as one and work towards lower global tariffs, export subsidies and domestic support.
3) Farmers are environmental engineers
While farming dominates the countryside, and makes it look the way it does, other things do happen there. The farmed environment sets the stage for leisure pursuits, wildlife habitats and floodwater management. Even with a subsidy, many small farms rely on second sources of income, sweat machinery that has lasted generations, or eke out grazing on marginal land. Meanwhile, their work supplying environmental benefits such as drinking water, flood protection and biodiversity goes largely unrewarded. In this clear example of market failure there is an opportunity to refocus taxpayer support to these common goods in place of less productive or outmoded agriculture.