British Agricultural Policy after Brexit

Dieter Helm, an economist and chair of the Natural Capital Committee has just published an important paper entitled ‘British Agricultural Policy after Brexit’. You can read his paper here. It is a very important contribution to the debate as DEFRA / George Eustice and Andrea Leadsom begin to plan what happens next with regards to the Common Agricultural Policy and its associated subsidies.

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Helm summarises the paper as follows “This paper sets outs three main options. It starts with a brief review of the CAP and its legacy, technical progress and the tensions between intensive food production and the environment. This provides the context for the assessment of the options. The paper concludes by proposing a gradual transitionary path to a much more economically efficient (and therefore environmentally efficient) outcome.

Talking about the impact of the CAP he says “Along the way it has created wine lakes and butter mountains, seriously damaged developing countries’ agricultural prospects through its external tariffs and export subsidies, inflated land prices and transformed much of the European agricultural landscapes. Biodiversity has been seriously damaged: the European countryside is a fragment of what it was environmentally, and large areas have been converted to intensive production.

Though some farmers have benefitted, most of the gains have gone in the capitalisation of the subsidies and to the bigger and richer landowners. Farming at the margins remains a precarious economic proposition. Small farmers have been on the retreat for several decades, and their future looks bleak – and with it the kinds of countryside, biodiversity and landscapes that they traditionally maintain.

The last sentence is particularly pertinent  to the Uplands generally and Dartmoor specifically.

Talking about the inherent conflict between maximising production and the environment he says “It is often claimed that farmers are special  – and therefore deserve special support – because they are “stewards of the land” and therefore have a special interest and responsibility to protect and enhance the environment. There are, on this view, no gaps between the public and the private interests:  farmers will internalise the environmental and other societal objectives in their decision-making. On this view we can leave the environment to its best protector, the farmers.

Though there may be such farmers, just as there are some benign industrialists more interested in workers’ wages than profits, this is not a good basis for designing policy. Modern agriculture has followed a path that has been evolved since people moved from hunter-gatherers to farming. The task, put simply, is to reduce and eliminate competitors to the crop or herd. The history of agriculture is the history of fighting back nature – clearing and burning forests, killing predators, pests and insects feeding on the crops, and reducing “weeds”. Agriculture has been one long fight against nature.

When it comes to his three options he says “There are three main ways forward in designing a British agricultural policy to replace the CAP. The first is to stay with the exiting framework, but to modify it to further promote more “food security” and “self sufficiency”. This is the NFU’s preferred option. The second is to stay with the exiting level of subsidy but to move it from income support to environmental support – essentially moving from Pillar One to Pillar Two. Option three is to use public funds for public goods directly, ending Pillar One and Pillar Two subsidies.

In essence he agues against option 1 as it will not deliver any environmental benefits, the second which is advocated by the National Trust for example (see here) he rejects as it will not deliver many of the environmental benefits that are needed. With option 3, his preferred choice he argues “A third option is to do away with all the subsidies, and instead concentrate any spending on directly purchasing the public goods that public money is paying for. This approach would sort out what the public goods from the land are, and how the natural capital embedded in the landscape could be enhanced.

This starkly sets out the options facing us now – it also shows us that there are many opportunities ahead as well as threats. It is hard to see option 1 being accepted despite the huge lobbying that the NFU will apply, equally it is hard to see option 3 gaining traction with the current Government as it requires an enlargement of government bodies such as National Parks and Natural England at the very time they are being slimmed down. That doesn’t mean option 2 will be accepted by default, it does mean that there is an awful lot at stake and a great deal to fight for.

Helm also talks about the transition period from the current CAP world we live in to the new policy and this is particularly relevant to Dartmoor and its farmers.

For small marginal and typically upland farmers, the loss of Pillar One and Pillar Two might mean an end to their farms. They would be the ones going out of business.

In terms of overall economic impact on the economy, the value of their agricultural outputs is already so low as to have no noticeable effects. It would not be noticed in GDP. Indeed GDP might go up, since the subsidies would no longer be a drag. Some of the land would be “re-wilded”, left to nature to manage for us. But the environmental effects could be very significant. The uplands are not “natural”: they are man-made landscapes of hedgerows, dry stonewalls, meadows and grazed moorlands.  It is naïve to think that a simple retreat and leaving nature to take its course would necessarily be the best environmental outcome.

There is also a powerful argument that these small upland farmers represent a culture that has value separate from the narrow economic outputs. They play a role in communities greatly in excess of their incomes and spending. Uplands given over to tourism would also not work without the management of the land.

The upland farmers have a key role in managing the land. Someone has to do it for the public benefit, and upland farmers tend to be rooted in these landscapes and understand them in a way that few from outside do. These are the marginal farmers, and the ones who are most dependent on subsidy. In any transition, these are the ones we should worry about – and not the large landowners in intensively large farms in the lowlands.

Interesting times ahead – there s a lot at stake.

6 thoughts on “British Agricultural Policy after Brexit

  1. Reblogged this on thinkingcountry and commented:
    This post from Adrian Colston discusses economist Dieter Helm’s recent paper entitled ‘British Agricultural Policy after Brexit’, originally posted on his blog. In the light of the new series on thinkingcountry apropos a new British Agricultural and Environmental policy in the light of Brexit I thought this would be a useful article to be presented on the site.

  2. Pingback: State of Nature 2016 – A Dartmoor and Devon blog

  3. Pingback: A day with the Upland Alliance – A Dartmoor and Devon blog

  4. Pingback: Odd coincidences in the world of Natural Capital – A Dartmoor blog

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