‘Fair Farm Funding’ campaign launched to avoid devolved complexities post-Brexit

Funding for agriculture in Wales must be delivered outside the Barnett formula, FUW says

A campaign has been launched to highlight the “urgent need” for the UK government to clarify funding for the farming industry in Wales.

The Farmers’ Union of Wales (FUW) has launched its ‘Fair Farm Funding’ campaign.

The campaign aims to secure fair funding for farmers in Wales after leaving the EU, ensuring that the industry does not receive less than it did before the UK left the European Union.

It also insists that funding for farming should not be subject to the Barnett Formula.

The Barnett formula is a mechanism used by the Treasury to automatically adjust the amounts of public expenditure allocated to Northern Ireland, Scotland and Wales to reflect changes in spending levels allocated to public services in England, England and Wales or Britain, as appropriate.

With around 12 months to go before the UK leaves the EU, the Welsh farming industry has stated that there is still no clarity over the post Brexit funding formula through which Wales will receive an allocation for agriculture and rural development.

’Complexities’

Launching the campaign at the Union’s Grand Council, Managing Director Alan Davies said any future funding will have to come from the UK Treasury.

“Historically, the funding to support farming in Wales has come from the Common Agricultural Policy, but once the UK leaves the EU in March next year that link will be broken,” Mr Davies said.

“We’ve already heard that the Government will commit the same amount of funding to agriculture for the rest of this parliament. But there are complexities around how that funding might be allocated.

“If the UK Treasury matches, as is expected, the current EU payments of £3.5 billion to DEFRA to support UK agriculture, there are at least 2 ways in which that money can be allocated to Wales. One method and the one most often used in UK Government financial calculations is to use the Barnett Formula.”

'New money'

Mr Davies explained that when “new” money is allocated to a government department, generally the “Barnett consequential” for Wales is around 5.6% of the total money allocated.

That means that if Defra receive £3.5 billion, the “Consequential” for Wales will be around £196 million.

He continued: “Wales has historically received around 9.4% of the total EU CAP budget allocation to the UK. That would equate to £329 million. Barnett would reduce our funding by around 40% and that must not happen.

“In order to deliver Fair Farm Funding for Wales it is therefore essential that the UK Government allocate funds outside the Barnett formula.

“Wales urgently needs certainty that we will receive at least our historical share of the UK’s agricultural and rural development budget promised by Secretary of State Michael Gove, especially as the budget for next year needs to be in place by October this year,” he added.

Quoting Carwyn Jones the First Minister of Wales, Mr Davies told delegates that: “To achieve this will require a new way of working and the FUW was pleased to hear Welsh Government recognise that ‘agricultural funding will have to be held in a separate pot and dealt with in a different way’.”