The Tenant Farmers Association (TFA) has issued a draft of potential agricultural policies which could be implemented by the government in the event of a vote to leave the EU at the forthcoming Referendum on 23 June.
Marcus Thorpe, head of law firm Trethowans Agriculture and Rural Property Team, takes an in-depth look at the policies.
Approximately 38% of the EU budget is spent on agriculture and rural development.
This pooling of resources at EU level ensures efficient and effective spending that avoids distorting the internal market and delivers a wide range of public goods.
It is much more efficient to have one common policy achieving common goals such as food security than 28 different competing national policies, and this efficiency frees up funds in national budgets to be spent elsewhere.
In 2015, the UK Government contributed an estimated £8.5 billion to the EU, roughly 1% of total public expenditure and equivalent to 0.5% of GDP.
There is no doubt that departure from the EU and the Common Agricultural Policy (CAP) and its subsidy and regulatory regimes would have an impact on UK farms and their income.
However, as is drummed into us on a daily basis, an exit from the EU by a member state has no historical precedent and ultimately, any predictions on the impact of exit can only be speculation.
DEFRA has refused to offer any plan to farmers outlining the lay of the land in the event of an European exit.
TFA Chief Executive George Dunn said: "The opinion of the Tenant Farmers Association is that without a credible plan for what a post-EU Britain would look like, it cannot advocate a vote to leave the EU.
"However, we have promised our members that we will keep this under review as new information becomes available in advance of the Referendum."
He continued: "Sadly, whilst there has been significant amounts of rhetoric, soundbites, claim and counterclaim from both sides of the campaign this has provided rather more heat than light.
"The TFA has therefore decided to publish a draft, post-EU agricultural policy for consultation to assist the debate and in the hope that there will be a better level of analysis of the impact on UK agriculture of either a vote to cease to be or remain a member of the EU."
"As I travel around the country, many farmers in their heart of hearts would like to see Britain leave the EU.
"They find it attractive to consider a future of self-determination, of clear policies, which would deliver a vibrant and prosperous agricultural industry, resilient against volatility and proudly supported by our own Government.
"However, they simply do not trust that British politicians would ever deliver such a vision and are therefore more likely to vote to remain within the EU.
"Perhaps the choice to leave would be made easier if they knew that this would also lead to a change in Government to deliver a pre-agreed agricultural policy for Britain. However this is not on offer," said Mr Dunn.
"The debate about our membership of the EU has got to be more than about subsidy payments.
"We should be looking at many other areas including developing fairer supply chains, ensuring protection against inappropriate trading practices, creating a proper and progressive farming ladder and protecting the British brand.
"The TFA’s draft policy addresses these and other areas," said Mr Dunn.
The TFA draft outlines various mechanisms:
1. Providing the Groceries Code Adjudicator with wider and deeper powers to investigate malpractice within the groceries supply chain.
The adjudicator must have OFSTED style powers to engage with retailers, a remit to look at the whole of the supply chain where required - not just direct contracts - and the responsibility to report on the balance of returns within the supply chain.
2. Requiring public food procurement policies to favour British produced food.
3. Requiring that all food sold in the UK is subject to meeting Red Tractor Standards
4. Mandatory country of origin labelling on all food sold through major retailers
5. Negotiation of access agreements for UK farm products into EU markets.
6. Respond robustly against tariffs levied by the EU on exports of farm products from the UK.
7. An assurance that free or favourable market access to the UK food market will not be used to lever favourable trade deals in other areas such as financial services.
8. Developing a new framework for ensuring the sustainable development of upland areas by refocusing support on ruminant livestock production as the foundation of sustainable upland management.
9. Domestic promotion of the high environmental, animal welfare and food safety standards of British food in comparison to imported products to displace those imports with domestically produced food.
10. Maintenance of the current budget of £3 billion allocated to agricultural support
11. Allocating £1 billion to a new agri-environment scheme which sets out a menu of costed options that farmers can choose from to deliver on their farms and judged on the basis of outcomes, as opposed to the means of achieving the outcomes, to include specific options for hill and upland farmers focusing on ruminant livestock production.
12. Allocating £1 billion to a new Farm Business Development Scheme to provide an annual grant of up to £25,000 per farm per year to assist with the implementation of approved five-year plans for farm development covering investment in fixed equipment, cost reduction initiatives, processing capacity, diversification, marketing, cooperative schemes, producer organisations, etc.
13. Allocating £1 billion to near market research and development, promotion, market development, brand development and other supply chain initiatives.
14. Implementing the TFAs plan for longer and more sustainable farm tenancies as follows:
• Restricting the generous, 100% relief from inheritance tax, currently available to all landlords regardless of the length of time for which they are prepared to let land, only to those prepared to let for 10 years or more.
• Clamping down on those landowners who are using share farming, contract farming, share partnerships and grazing licences as vehicles for aggressive tax avoidance since in practice they take no risk, have no entrepreneurial input and lack any managerial control.
• Offering landlords prepared to let land for 10 years or more the ability to declare their income as if it were trading income for taxation purposes.
• Reforming stamp duty land tax to end the discrimination against longer tenancies.
• Requiring landlords over whom the government has influence (for example, the Crown Estate) to default to 10-year-plus farm tenancies.
• Providing landlords with more practical provisions for handling tenancy breaches than currently exist in agreements where landlords let for 10 years or more.
'Lack of certainty around an EU exit is a challenge'
"The TFA has demonstrated commitment to keeping this position under review and has produced proposal for a potential post-EU agricultural policy for the UK to adopt.
"However, without the support of Government and DEFRA there are no guarantees that this policy would be implemented in the event of an EU exit and it’s viability and feasibility can only be considered speculative at this time.
"The challenge that the UK faces is the lack of certainty around an EU exit because there is no precedent of a member states departure since the EU’s formation.
"The only thing that we can be certain of in the face of an EU exit is uncertainty itself," the TFA concluded.
