Farm Ireland

Wednesday 13 December 2017

British farmers come full circle on Europe

The UK's agri sector has always been ambiguous about stronger links with the continent

A tranquil scene on the home front in the British countryside where the majority of farmers voted in favour of Brexit
A tranquil scene on the home front in the British countryside where the majority of farmers voted in favour of Brexit
Declan O'Brien

Declan O'Brien

Last year's Brexit vote was undoubtedly a shock for many of the 100,000 or so commercial farmers in the UK.

Although a sizeable proportion of those working the land in Northern Ireland and Scotland voted to remain, the general consensus is that the vast majority of their colleagues in England and Wales took Ukip's line on the referendum.

In so doing they were undoubtedly influenced by the fact that Britain imports close to 40pc of its total food requirements and is considered one of the most lucrative markets in the western world.

Brexit is therefore an attractive option for UK farmers, supporters of the 'Leave' campaign argue, offering the promise of significant income growth as local suppliers increase output to replace imported goods.

A simplistic analysis the 'Remain' camp maintain.

Ironically, similar arguments were made by farmers in England and Wales in the 1960s and early 1970s when the issue of Britain joining the then EEC was initially considered.

Although Britain, Ireland and Denmark did not join the EEC until 1973, the National Farmers Union (NFU) was expressing reservations about the move as early as 1968.

Commenting on the possibility of Britain joining what was then referred to as the Common Market, Welsh NFU officer, GT Lewis, questioned if the EEC's CAP would be as beneficial as the UK farm supports which were known as 'deficiency payments'.

Also Read

The deficiency payment system established an agreed viable floor price for commodities such as beef, which was reviewed through the year on a rolling basis. If the open market didn't deliver this floor price, the British exchequer made up the difference between the actual market price and the agreed viable price. This was termed the deficiency payment.

This approach allowed the UK to maintain a cheap food policy for consumers by encouraging imports, while compensating local farmers for the low-price regime.

While both systems delivered generous payments to food producers, Mr Lewis said British farmers were concerned that they would see an erosion of the stability they enjoyed under the deficiency payment model.

Interestingly, the NFU was also worried that the organisation's input into farm policy would be significantly diluted as power shifted from London to Brussels. "Presumably, the future of our farming organisations in influencing agricultural policy would be in jeopardy, and their power greatly reduced," he predicted.

However, the NFU man welcomed the fact that British agriculture within the EEC would be afforded the protection of tariff barriers for the first time since the "repeal of the corn laws".

Farmers' opinions on EEC membership also varied according to the size of their operation and the sector they were involved in.

While Mr Lewis doubted that EEC membership would be good for small-scale hill farms in Wales, he accepted that larger cereal growers in the English midlands and east coast region would benefit greatly.

Joining the Common Market was also broadly supported by Scotland's sheep farmers, who recognised the opportunities it presented to gain access to the lucrative French market.

Indeed, the NFU in Scotland wanted Britain to agree to a common sheep policy from the time of entry. However, Westminster was reluctant to agree to such a move out of loyalty to New Zealand. Indeed, it eventually secured a sizeable EEC import quota for New Zealand's sheep farmers.

Britain's vegetable growers were seriously concerned about EEC membership and greater competition from Dutch farmers in particular. The NFU's horticulture committee chairman, who ironically was named Jack French, forecast that joining the Common Market would mean the "survival of the fittest" for his members.

Despite these reservations, the NFU approved the Common Market's terms for agriculture in July 1971.

The union maintained that although joining the EEC posed serious challenges, there would be greater risks for British agriculture and horticulture if the UK stayed out.

Although the EEC was hit by a serious beef shortage in 1972, milk production across the six-country grouping was already in surplus and output of grain, pigs and poultry had increased steadily through the 1960s. As a consequence, British farmers feared their market could become a cheap dumping ground for CAP's excess produce.

No one knows what the post-Brexit period holds for UK farmers. Will the British exchequer match EU CAP payments? Or will Westminster revive the old deficiency payments regime?

Will they adopt a cheap food policy and do trade deals with Brazil, Argentina, Australia and New Zealand?

Only time will tell.

Indo Farming

More in EU