CAP, Brexit and the future
With the rural and agricultural landscape shifting like never before, how does the future look for the industry and on Whitehall-led policies?
Nick Playford, an associate at Telford and Ludlow law firm mfg Solicitors says: It is perhaps premature to write an incisive piece about the new Agricultural Bill which was only announced on June 21. However, the new Bill, which will result in the first major Act without EU governance since 1947, is seen as a positive move.
The new Defra Secretary Michael Gove’s intention is to ensure an effective system is in place to support British farmers and protect the natural environment after the UK exits the EU – whilst at the same time reforming the Common Agricultural Policy. In short, it is Gove’s pledge to champion UK farmers. The proof, as ever, will be in the pudding.
The resulting Act will provide the legislative arm for the administration of the Basic Payment Scheme, giving the Government the power to make payments to farmers - with the Rural Payments Agency and Natural England continuing to administer funds. The Government has also indicated that payments would remain at the same level until 2020. But what of the long-term future?
We know that 80 per cent of the UK’s domestic Gross National Product is accounted for within the service sector whilst the agricultural sector is now below one per cent. The agricultural sector can only punch above its weight to some extent when negotiating trade agreements. What will happen when the UK takes control of the Basic Payment? Is the sector really more important than health and education in terms of the Government’s priorities?
It is important to remember that UK farmers are currently protected from cheaper global imports as a result of EU tariffs. This is a point which is often missed as the focus often revolves on the UK farming industry’s exporting strength. If the Government focus becomes one of a free global commodity trade, and the UK’s protection is diminished, then this will create a serious body blow for the UK’s agricultural sector.
As the Agriculture Bill unfolds, it seems clear that there is potential for competition for UK resources. The farming sector should be taking this opportunity to focus on what it can control. If there is a greater link between future farming payments and the environment, then farmers should be prepared.
Despite a certain gloominess, it seems inevitable that the best prepared rural businesses will continue to flourish. The banks all have money to lend so now could be the time to invest in precision farming, technology and automation and get ahead of the game. Failure to do so may result in your business falling by the wayside.
Contact Nick on 01952641651 email nicholas.playford@mfgsolicitors.com
