Pressure is mounting on the government to provide more detail about what a possible EU exit would mean for farming businesses, as farmers battle with price volatility and uncertainty.
At a City University conference on Monday (14 December), agricultural economists and farming leaders said businesses could be in for a long period of uncertainty if the UK voted to leave the EU.
They said there was little evidence the UK government was seriously considering options for agriculture in the event of such a vote and there were numerous uncertainties around trade (the EU accounts for 78% of UK food and drink exports), support payments and regulations.
This came just days after the Welsh government’s first minister, Carwyn Jones, warned the country’s farming sector would end if it ceased to receive EU support payments – and less than a month after NFU Scotland vice-president Andrew McCornick told the Scottish government farmers needed clarity on trading arrangements if the UK left the EU.
At City University, agricultural economist Alan Swinbank. from the University of Reading, urged the farming industry to say what kind of an agreement it wanted in the event of an EU exit.
“I don’t see feel there is any clarity [from the government] about what exit means,” said Prof Swinbank, who described this as “politically worrying”.
He said there were 11 potential trade arrangements that an independent UK could have with the EU, but it was “quite possible” such negotiations would be long and with no trade agreement at the end.
In addition, if the UK chose to apply farming support payments as a non-EU member, this could be legally challenged by other World Trade Organization (WTO) members as a trade distorting measure.
“We could see a period of litigation that could stretch for years,” said Prof Swinbank, with UK farming support payments found incompatible with WTO rules.
If the UK’s devolved governments wanted to support their farmers with payments, there was also no guarantee the Treasury would agree to this or, if it did, English farmers could lose out, while farmers in the rest of the UK might get payments.
Martin Haworth, acting director-general of the NFU, said he was “very dubious” the government would commit to UK farming support payments and it was “questionable” to assume, as Ukip did, the money saved from EU membership would be directed back to farming.
Farmers should also question the assumption that the UK would be free of Brussels regulation, as they would still need to adhere to EU standards to keep trading with it.