The Environment, Food and Rural Affairs Committee is today launching its report, The Future for Food, Farming and the Environment.  The inquiry focused on the impact of leaving the Common Agricultural Policy (CAP) and whether the Government’s proposals will deliver on its ambitions to both increase farm competitiveness and enhance the environment.

The report responds to the Government’s Consultation, ‘Health and Harmony: the future for food, farming and the environment in a Green Brexit.’ The Committee is calling on the Government to ring-fence funding for farming post-Brexit, provide much greater details on its new support mechanisms for farmers, and ensure environmental and welfare standards are maintained on products entering Britain. 

Neil Parish MP, Chair of the Environment, Food and Rural Affairs Committee, said:

“A new funding model for agriculture is essential for the future prosperity of UK farming. As we leave the EU we must ensure that we maintain our standards, and that those importing into the UK meet our high standards of production.

“The Government should commit to funding the future agricultural policy using ring-fenced funds, consider new support mechanisms such as tax breaks and capital grant support, ensure that trade agreements demand that imported products meet our standards, and avoid a regulatory race to the bottom.

“Defra’s consultation is ambitious and we welcome much of its intent. There is a notable lack of detail in the Government’s paper, however, and we seek more clarity on funding, delivery, and timing. The Government risks not achieving its ambition and risks damaging the sector. The Government should respond to the farming sector’s concerns and provide clarity as soon as possible.”

Common Agricultural Policy (CAP)

Our report highlights the need for the Government to produce a thorough sectoral assessment of these impacts to identify support for small and medium-sized farms and should commit to ring fencing the funds released to fund the rural economy and environment. Withdrawing Direct Payments will have a varied impact between sectors, and particularly damaging effects will be felt by grazing livestock, cereal and mixed farms.

Farm competitiveness

Agricultural productivity is in decline and the UK is falling behind its competitors, the White Paper fails to address the barriers to productivity and so will not support the Government’s ambitions for farming in England. It should produce a farm productivity plan by May 2019 that investigates new tax breaks, advice centres, capital grant support and the successor to the agri-tech fund, amongst other areas of exploration.

Environmental Public Goods

There is broad support for including animal health and welfare within Defra’s public money for public goods policy, but the paper has failed to consider wider food policy with public impact such as reducing diet-related diseases. It should support healthy food in payment models to farming, and bring forward changes to Government buying standards and ensure use of healthy, affordable and British food in Government procurement.

Further, it will be challenging for Defra to find the right body to coordinate its national public goods framework, and to avoid a ‘race to the bottom’ in standards as the industry sheds EU regulation.  The Government should assess which public bodies can coordinate the environmental land management system.

Trade and labelling

Defra’s involvement in agri-food negotiations is positive, and the Committee is calling on the Government to ensure that trade agreements always prevent agri-food products that do not meet our environmental, animal welfare and food standards from entering the country. This will be supported by the Committee’s recommendation to improve country of origin food labelling.

Professor Ian Bateman, Professor of Environmental Economics, Director of the Land, Environment, Economics and Policy Institute (LEEP) at the University of Exeter, said:

“The argument that we should use public money to fund decent levels of animal welfare is fraught with moral hazard if this translates into in effect paying individuals to not treat animals badly. This is better dealt with through clear regulations prohibiting poor welfare backed with trade restrictions against the import of food produced to lower standards.

“The report argues that public health could be improved through an expansion of some sectors of UK agriculture. This is well-meaning but misguided.  Access to food is a public good and preventing food poverty is extremely important. However, trying to ensure that the poorest consumers in society have access to high quality food by subsidising food producers is at best highly inefficient and likely to be a complete waste of taxpayers’ money. Food producers quite understandably sell to the highest bidder – that’s not going to be the poor. We should subsidise access to food not its production.

“The government are right to target environmental improvement as the key public good farmers can provide.

“The present subsidy system is grossly unfair giving three quarters of taxpayers' money to the one quarter of biggest, and typically richest, farmers in the country simply because they own the most land. The same budget could be reallocated to provide an income safety net to alleviate poverty amongst the poorest farmers in the country and still produce massive environmental improvements. This would be a win-win for the environment, for tax-payers and society, and for the majority of farmers.”

CLA President Tim Breitmeyer said: “Brexit brings major opportunities for positive change in farming, but success depends on a carefully planned transition. We are pleased MPs have added their voice to our call for Government to focus on a plan for boosting farm profitability. Getting this aspect of post-Brexit right must be considered to be a vital precondition of any moves to remove the basic payment system with a clear strategy, worked up and funding allocated.

“The Committee provides a timely reminder that production of healthy food is, and must remain, the most important land use in our countryside. A dynamic, progressive and sustainable farming industry can work alongside significant improvement in our environmental delivery, and a vision for a long-term policy to replace the Common Agricultural Policy must have sustaining this balance as its overriding objective.

 “The Committee is right to warn of the risks of rushed free trade deals with new markets that result in an overall lessening in our world leading standards of animal welfare. Our trade policy must be based on encouraging other markets to meet our high standards, and not turning a blind eye to lower standards on food imported from less well-regulated markets.”

Minette Batters said “The NFU is pleased to see the Committee request that government produce a farm productivity plan by May 2019 and believe this could be a vital tool in ensuring that farm businesses are able to perform at their best and continue producing high-quality, safe, traceable food for the nation.

“A ring-fenced agricultural fund, along with new support mechanisms would also provide a positive step towards this. Sectoral assessments of the withdrawal of direct payments, as recommended by the report, would help the targeting of this additional support.

“As the Committee points out, the forthcoming Agriculture Bill will provide a crucial vehicle for implementing these and many other aspects of future agricultural policy. We agree that it is vital that the Committee carries out pre-legislative scrutiny before the formal introduction of the Bill.

“Farming is a long-term business and farm businesses need urgent clarity on what their future trading situation, labour supply and funding will look like. The NFU continues to press Government on confirming how long a transition period will apply for agriculture to ensure farmers are able to plan properly.”