Monday, January 07, 2019

Public goods scheme may run into trouble

The Government's intention to switch to public goods payments for farmers after Brexit may fall foul of the poor record of implementation of existing agri-environmental schemes. About 30 per cent of the farmers signed up to the various green programmes are still waiting for payments from 2017.

Payments often come up to a year late. By the government's own assessment, delivery of the country stewardship scheme has 'fallen short' and 'the situation is unacceptable' according to the latest annual report from Natural England.

The new schemes are likely to be even more complex and will have more money going through them, making even more delays likely.

Given the likely complexities of making applications, farmers could simply opt to farm their land more intensively, reversing previous environmental gains.

Thursday, January 03, 2019

Gove warns of Brexit farming woes

The text of Michael Gove's speech to the Oxford Farming Conference: Defra Secretary

He comments, 'I cannot, here, entirely pre-empt the outcome of the Government’s Spending Review.' Indeed, but it is of crucial importance and the Treasury has a long held suspicion of farming subsidies. Gove claims, 'Embracing change, supporting reform is the key to unlocking the Treasury’s special box.'

The Secretary of State admitted, 'It’s a grim but inescapable fact that in the event of a no-deal Brexit, the effective tariffs on beef and sheep meat would be above 40% - in some cases well above that. While exchange rates might take some of the strain, the costs imposed by new tariffs would undoubtedly exceed any adjustment in the currency markets.'

In addition, 'The combination of significant tariffs when none exist now, friction and checks at the border when none exist now and requirements to re-route or pay more for transport when current arrangements are frictionless, will all add to costs for producers. As will new labelling requirements, potential delays in the recognition of organic products, potentially reduced labour flows and the need to provide export health certificates for the EU market which are not needed now.'

'Nobody can be blithe or blasé about the real impact on food producers of leaving without a deal.'

The CAP and farming resilience

What contribution does the CAP make to farming resilience? An in depth report on the subject: Resilience Assessment

The resilience of farms and farm systems has become more of a concern in agricultural policy-making. In recent years, European farming systems have generally experienced more pronounced and overlapping challenges: on the one hand, a build-up of shocks such as more frequent extreme weather events, increased price volatility on liberalised markets or unpredictable political interventions to trade policies.

These are accompanied by significant long-term stresses, such as changing consumer preferences, climate change, rural outmigration or the lack of skilled labour. The accumulation of these overlapping environmental, economic, social and institutional challenges could render many farming systems in Europe vulnerable and threaten their functions, i.e. the production of food and fibre as well as the provision of public goods.

The analysis reveals that the CAP and its national implementations do enhance the resilience of most farming systems in the case studies. However, there is a clear bias towards a robustness-cum-adaptability orientation. The main reason for this is that the bulk of resources go into payments that provide buffer resources for farms and enable the continuation of otherwise less profitable business models, thereby stabilising the status quo.

Fewer resources are funnelled into measures that enhance adaptability; this occurs mostly through rural development programs and in some cases producer organisations. An open question is whether the relatively ample support for robustness creates disincentives for adaptation or transformation and therefore impedes these other resilience dimensions.