It’s all pain
AS IF the pain inflicted by the ‘Cost of Farming Crisis’ was not enough, the Treasury’s tax cut plans have backfired somewhat and the nett effect will be a crushing blow to farming’s bottom line.
For, on the one hand, the tax cuts will do little to help many farmers – as part of their raison d’etre is to tweak their investment in new kit so that they pay as little tax as possible!
On the other hand, the fairly extensive and expensive hits that are expected to raise interest rates considerably to counter the effect that these cuts might have on inflation, will have a huge effect on farming, especially those highly geared units that took advantage of the cheap ‘money’ that we have all enjoyed over the past half-decade or so to upgrade or buy new land. Winter’s definitely coming for them!
Farming’s bank borrowings and loans is thought to be in the region of £30bn-plus and you don’t need to be Einstein to work out that every percentage increase in interest rates will have a colossal effect.
As for a whole heap of farming input costs, the catastrophic hit that sterling took on the currency markets this week will mean that everything from fertiliser to new machinery will inevitably cost more. The small upside is that anything we export abroad will be more competitive ... not that we export a significant amount of anything, except lamb.
The fact is, that for farming, the intense pressure on increased costs will continue for some time to come and as our front-page story records this week, experts reckon it could be the middle of next year before high fertiliser prices begin to show any signs of decline.
What could help would be some clarity on future policy and that’s about as opaque as slurry on the parlour window at the moment. Despite the political inertia in Scotland, there seems to be an acceptance across Europe and to the south, in England, that all of the ‘Green deals’ and ‘Farm to fork’ policies have been shown to be the sham the industry always thought they were.
The exposure has shown that many of these policies had been led by fanciful environmental freebooters with little regard for anything other that butterflies and bees who attack farming at every level from their high-rise Ivory Towers. And with no regard for the food safety of supply and quality for the nation.
So, perhaps it is time for the ‘real’ politicians of this country to stand up and be counted and defend the right to farm in a proper and efficient manner that will reflect the overwhelming need for a secure food supply and balanced with a sensible approach to environmental safeguards.
How good would it be if all land sales for ‘green-washing’ by the likes of airlines and car manufacturers, would see a proportion of the carbon savings ring-fenced for agriculture?
It might be a complicated process, but certainly one worth striving for. We have given away too many green credentials to companies that don’t really deserve them, while preserving many tax benefits for them and ending up with hee-haw for our own industry.