Hill-farmers must not be left behind as we set sail for Brexit
COLUMNIST
THE departure of a ship carrying the first frozen meat exports from New Zealand to Britain in 1882 is remembered as a landmark moment in the story of the Antipodean country.
It is chronicled by the New Zealand government’s history website as event which paved “the way for the trade in frozen meat and dairy products that became the cornerstone of New Zealand’s 20th-century economy”.
Today, Brexiteers dream of Britain forging new trade links with countries far beyond the EU which will transform the UK’s economy in the decades ahead. They look forward to the moment negotiators can get down to business and strike free trade deals with a host of emerging economic powerhouses.
But, more than a century after the Dunedin set sail on its hemispherecrossing journey with its on-board coal-powered freezing plant working away, Welsh farmers are anxious about contemporary New Zealand imports.
Lamb farmers in particular are concerned about the consequences of a post-Brexit free trade; they fear the UK market will be flooded with cheap produce.
Hill farmers across Wales have had a tough enough time balancing the books for generations; they will hope they will not be numbered among the casualties of Brexit.
The future of agriculture is shaping up to be one of the thorniest Brexit dilemmas.
David Lidington, the nearest thing Theresa May has to a Deputy Prime Minister, is preparing a big speech intended to address the impact of Brexit on the devolved nations.
Last year his predecessor, Damian Green, let slip the scale of worry in Whitehall about what will happen if governments introduce different schemes to protect farming, saying: “We need to make sure that we don’t have subsidy wars to try to help sheep farmers, some in Scotland and some in Wales and so on.”
Meanwhile, economists are warning of just how vulnerable household incomes are to changes in food prices.
In July, the Institute for Fiscal Studies reported that “around 30% of the value of food purchased by households in the UK is imported” – with the EU the main supplier.
It warned: “If the UK and the postBrexit EU fail to strike a free trade deal, it is likely tariffs would be imposed on EU imports into the UK, as the UK would be unable to impose zero tariffs on imports from the EU without also extending tariff-free access to all other [World Trade Organisation] members.”
The IFS claimed a price hike would hurt the poorest households the worst because a bigger proportion of their spending goes on food than in richer families – “23% of spending for the lowest-income tenth of households versus 10% for the highest-income tenth”.
Negotiators have little time to construct a Brexit deal which doesn’t outrage devolved governments, terrify hard-pressed farmers and make life tougher for austerity-hit families.
Ministers could do worse than look back to that New Zealand voyage of 1882 and take inspiration from the captain of the Dunedin. John Whitson was determined that his cargo of around 5,000 carcasses would reach Britain in prime condition.
When the crew realised that cold air was not circulating properly in the hold he crawled in and sawed extra air holes.
The New Zealand government’s account says he nearly froze to death in the process and had to be pulled out with a rope and resuscitated.
That’s the type of dedication we need to see as the March 2019 Brexit Day nears. Just one carcass had to be condemned and the safe arrival of the goods laid the foundation for the economic transformation of an entire country.
In fairness, it also should be noted that the Dunedin vanished in the Southern Ocean in 1890. All maritime adventures contain an element of risk, and for every Brexit buccaneer there is someone else for whom the thought of this enterprise gives them a sinking feeling.
As with so much of the Brexit debate, the sharpest divisions are between optimists and pessimists. Those with the sunniest view of Brexit expect food costs will go down – not up – and argue that the UK leaving the EU should be good news for the developing world.
Leading Brexiteer Jacob ReesMogg makes the case that scaling back tariffs will “potentially reduce people’s food costs by 20%”.
The influential Policy Exchange think tank argues in its Farming Tomorrow report: “Britain should use the opportunity from leaving the European Union and the Customs Union to phase out all tariffs protecting agriculture, relying instead on direct subsidies to achieve economic and environmental goals. This would lower prices for consumers, increase producer productivity and enable new trade deals both for Britain and the developing world.”
Shankar Singham of the Legatum Institute argues that the EU’s Common Agricultural Policy has been terrible for the some of the world’s poorest countries, claiming it “leads to overproduction, creating mountains of surplus produce that is either destroyed or dumped on developing nations”.
However, The British Retail Consortium warned a House of Lords inquiry that in the event of a no-deal Brexit the average tariff on food coming from the EU would be 22%. Irish cheddar would be hit with a 44% tariff, while beef would face one of 40%.
The highly-respected National Institute of Social and Economic Research argues households could face a rise in the annual shopping bill of up to £930 if there is no exit deal.
Former Sainsbury’s chief executive Justin King has warned of the potential of “higher prices, less choice, and poorer quality”.
There are a host of other factors which could also affect farmers’ livelihoods and the cost of food. The value of the pound as the UK heads out of the EU will have an enormous impact, the deal on Northern Ireland’s border could have profound consequences for the future of Wales’ ports, and there are concerns red tape could lead to disastrous delays at customs checks.
An epic responsibility now rests on the shoulder of the UK Government’s negotiating team. Mrs May has signalled we are leaving both the single market and the customs union but ministers have yet to reveal anything like the full shape of the new arrangements they hope to secure.
The future of farming communities and the health of families is at stake.
If the debate about Britain’s future degenerates into nothing more than a power struggle between bitter ideological rivals in the Commons then households could be pushed into crisis.