‘Third world economy’ warning for UK farming

After the NFU had stressed that some farms could be ‘on the brink of collapse’ in the event of a no-deal after Brexit, today’s announcement by Brexit secretary, Dominic Raab, does not offer much to placate farmers.

The recently parachuted-into-the-role Mr Raab today set out what he called ‘practical and proportionate’ advice in case the UK leaves the EU with ‘no deal’. However, he was quick to reassure the public that this advice would be rendered redundant if an agreement is reached with the UK.

“Reaching a deal with the EU is our over-riding priority and by far the most likely outcome, but we must be ready to consider the alternative,” explained Mr Raab. He also announced that the government would release 25 technical notices setting out what it is doing to prepare for a ‘no deal’.

The upshot of this seems to be that farming is clearly labelled as an industry of concern, as the first batch of notices offers advice on farming and organic production, in the same breath as medical supplies and financial services.

The Scottish Government responded to the UK Government by demanding that a ‘no deal’ option is out of the question. “What is clear from these papers is that the UK Government should rule out a disastrous ‘no deal’ scenario and focus instead on securing the best possible outcome for the rural economy – notably staying in the single market and customs union,” stressed Rural Economy Secretary, Fergus Ewing.

“Farmers and food producers want to know if they will still be able to sell their products in the event of the UK crashing out of the EU without a deal in March 2019. So, while these technical notices from the UK Government lay bare the risks facing Scottish farmers and the wider rural economy, they fail to provide much needed clarity over the long term.”

Mr Ewing critiqued Westminster’s inability to look beyond the transition period at long-term support for agriculture and recognise the economic challenges facing rural businesses.

“During the referendum, promises were made to farmers that they would continue to receive at least the same level of funding as they currently do in the event of Brexit. These papers fail to confirm that this will, indeed, happen and in fact give no detail on what is actually meant by the UK government’s commitment to maintain the same level of farm support until the end of this Parliament,” he continued.

“This will be of no comfort to farmers and rural businesses facing the real risk of a ‘no deal’ Brexit nightmare, who need to be able to plan well into the future.”

Farmers are now trapped in the choppy waters of not knowing whether they still have a market to speak of, plus the added issue of whether they will receive payments under long-term programmes. NFU Scotland president, Andrew McCornick, expressed irritation at today’s announcement. He said that the same burning questions had been left unanswered, with no further clarity.

“The government needs to start giving details of what life is going to be like on the other side of Brexit. We realise that it cannot make commitments beyond its lifetime without confidence about the future of farm payments beyond 2022, however Scottish farm and croft businesses need a clear steer on how they should prepare beyond this time – particularly if, in the wake of a ‘no-deal’ Brexit, trade flows are significantly disrupted,” he stressed.

“There is still not enough clarity with regard to what farm support the UK government is planning to continue up to 2022. NFU Scotland has repeatedly asked the UK government to define which schemes under Pillar 1 and 2 will be funded up to 2022, but continue to get no solid answer,” he continued.

“This is particularly concerning in terms of Pillar 2 schemes. This support covers multi-annual agreements such as Agri-Environment Climate Schemes, the Beef Efficiency Scheme, and advisory support via the Farm Advisory Service. It also encompasses lifeline payments such as the Less Favoured Area Support Scheme.”

He made it clear that a ‘no-deal’ Brexit would destabilise agriculture and that the UK must push for unfettered trade in agri-foods between the UK and EU.

“A ‘no-deal’ Brexit would mean the UK becoming a ‘third world country’ overnight, bringing in hard borders and the WTO default being imposed. That runs completely contrary to our desire for trade to be as friction free as possible,” he warned.