Tuesday, February 21, 2017
Friday, February 10, 2017
No priority at all?
According to a leaked report in The Times today, the Government has divided sectors of the economy into high, medium and low priority for the Brexit negotiations.
As one might expect, pharmaceuticals, motor vehicles, aerospace and air transport get high priority, along with (rather more surprising) textiles and clothing. Fisheries gets into the medium priority list. But in this leaked list, agriculture and food processing don't get mentioned at all.
That is a concern when agriculture could be the sector economically damaged by Brexit through a combination of the loss of subsidies and the removal of tariff protection.
Tuesday, February 07, 2017
What form of pesticide regulation after Brexit?
This is one of the many complexities to be faced after Brexit and fortunately the ADHB has produced an excellent guide to the subject authored by Sarah Barker and John Knight: Horizon study
After the referendum, I heard that some arable farmers had voted for Brexít because of restrictive pesticide regulations. However, this study concludes: 'The regulatory burden might not be reduced as much as farmers hope and in any event would probably take a number of years to achieve. It is also likely that environmental, consumer and public health lobbies will continue to be influential and to exert pressure for more stringent regulation'.
The report sets out four options. Aligning with the EU would be relatively straightforward, provided it was accepted by the EU. The precautionary principle would continue, but the UK would have no influence over the approval process which might become more restrictive with the remaining EU members.
Aligning with the US has found favour in some quarters because of the use of a risk-based approach there. More actives and products would become available to the UK industry and more biologicals would be available [the US has been particularly innovative in this area]. However, there might be a pressure group reaction to a more permissive regime and climatic differences may mean that US actives are less suitable for use in the UK, particularly for niche crops.
Adopting OECD standards, which use a risk-based approach, might work in the future but there are major challenges in obtaining efficient collaboration between multiple governments.
The UK could have its own policy which would give it full control of the approvals process. It could adopt a low-risk approach and it might be possible to speed up the approval of biopesticides. However, the registration and use of pesticides would have to be acceptable to trading partners. The UK may be seen as too small a market for companies to go to the expense of registering products for approval, leading to fewer actives being available.
In other words, there is no ideal solution, although a UK policy might be seen as politically compatible with hard Brexit.
Monday, January 30, 2017
The future of agri-food trade
Thursday, January 26, 2017
Can Defra cope?
At yesterday's Lords committee meeting, I was asked if government needed to be more proactive in identifying regulations that could be abolished or modified after Brexit. My response was, in effect, that Defra had been hollowed out so much, I doubt whether it had the capacity.
This view is confirmed by the latest Whitehall Monitor published by the Institute for Government: Whitehall Monitor
It points out that Defra has estimated that around a quarter of EU laws (around 1,200) relate to its work, and that 80 per cent of the department's work is 'framed' by EU legislation. But staff levels have fallen by a third since 2010.
It also notes that Defra has had relatively little recent legislative experience, its responsibilities since 2010/11 being limited to two Government bills that became law.
Be very, very afraid
At one point in yesterday's House of Lords committee evidence session, Professor Alan Swinbank envisaged a future in which there were fewer farming enterprises in Britain. I know that the committee were very interested in a paper he had written for the University of Sussex trade observatory entitled 'World Trade Rules and the Policy Options for British Agriculture Post-Brexit.' The contents, although rigorously argued, are somewhat more explosive than the anodyne title might suggest. You can download the full paper here: Key reflections
It is worth quoting a little of what he says in his conclusion. Professor Swinbank is one of the leading experts on the CAP, but also on agricultural trade policy.
He warns, 'It is highly unlikely that agricultural issues will determine the UK's future trade policy, as easy access for sugar, beef or butter to the UK's market for example could well be some of the key demands of potential FTA partners.' He continues, 'A unilateral reduction in tariff barriers to lower food prices and increase competitive pressures, would probably be unwise (although appealing to a number of economists) as it is those high tariffs that strengthen the UK's negotiating capital.'
He notes that alternative trade scenarios could result in a large number of farms being 'put under considerable financial pressures, with an uncertain impact on farming practices and the environment ... [Farmers] would probably protest vigorously if both taxpayer funded support and tariff protection were removed in a double whammy.'
In yesterday's session, Alan Swinbank was asked if any free trade pacts would be beneficial for agriculture. He noted that the real danger did not come from an agreement with the United States, but from agreements with Brazil or other South American countries, Australia and New Zealand. Australia would like to increase its tariff free exports of sheepmeat to the UK. Benefits could come from agreements with highly protected markets to which high value added goods could be sold: Japan, (South) Korea and Norway.
Further information about Alan Swinbank's remarks to the Lords committee can be found here: Irish Farmers Journal
Wednesday, January 18, 2017
House of Lords launches Brexit and agriculture enquiry
The House of Lords Energy and Environment Sub-Committee of its EU Committee has launched a short inquiry into the implications of Brexit for UK agriculture: Brexit
Excerpts from the evidence given by Alan Swinbank and myself were used on Farming Today on 26th January.
The full visual and audio record of the meeting can be found here: Evidence
Monday, January 16, 2017
'Cliff edge' for farmers
As I write this post, the Council of the National Farmers' Union is debating options for farming post Brexit a few miles away at Stoneleigh Park and none of the scenarios looks particularly promising.
If area subsidies are withdrawn overnight, farmers will face a 'cliff edge'. Many enterprises will go out of business and be consolidated into larger businesses or bought by foreign investors at a knockdown price.
We need a phasing out of existing forms of subsidy. Exactly how this might be done is something I am working on at the moment.
Earlier this morning I did a television interview for Reuters on the challenges for UK farming post Brexit. The interviewer made the point that they heard a lot in London about the needs of the financial services industry, but very little about farming. Exactly so.
Indeed, the UK Government is now contemplating a trade deal with New Zealand that would benefit the financial services industry, but allow in additional imports of lamb, to the detriment of the sheepmeat industry.
The Scottish Government is considering continuing general subsidies after Brexit, although they may face budgetary constraints in doing so. What is clear is that French and German farmers will continue to receive CAP subsidies which could amount to 20 per cent of the market value of product.
I want to move away from subsidies, and in particular blanket subsidies that are not related to a policy objective. But it must be done in a way that allows the industry to adjust.