Opinion: 3 things that must change for a successful Brexit

Can we make a success of Brexit? Of course we can. Given time, the UK, like any other country, can do what it sets its mind to.

But that is the wrong question. Better is “can we, with our present practices and mix of policies, make a success of Brexit?” Here the answer has to be “probably not”.

See also: Cheap food after Brexit is an illusion

What justifies such a pessimistic conclusion?  The answer is “history”. For more than 40 years, we have had unhindered and secure access to the world’s richest market – no tariffs, no non-tariff barriers, no paperwork, no transport hold-ups.

Yet, throughout this time, not to put too fine a point on it, we have declined.

Many economic indices justify this view. But let’s keep it simple. In 1973, when Britain joined the then EEC, the pound bought about 100 Belgian francs.

Now it buys 44BFr (or it would if the Belgian franc still existed). That is a devaluation of more than 50% – yet it has not galvanised our agricultural performance.

If we think about this, we can begin to see some of the things that will have to change for us to make a success of Brexit. Here are three.

Currency

The first is currency. The steady devaluation of sterling has been a boost. It has made us more competitive in euro-markets.

And we have been sheltered from the negative effect of higher input prices because our support payments have been set in euros and inched higher as the pound declined. We’ve been getting the best of both worlds.

After March, perhaps not brutally at first, our EU farm support will fall away. Yes, the government says it will maintain our support payments – but in pounds. We are about to lose the income top-up we have received because of the weaker pound. We shall be more affected by the higher prices for our imported inputs.

So part of making a success of Brexit has to be a faster rate of productivity gain. Bland words that describe the frequently heart-breaking battle to “produce more from less” by driving people out of farming.

Government

Second, and probably more controversial, is the role of government.

Through our years in the EU, we have benefitted from an efficient and creative farm administration in Brussels that aimed to improve farmers’ welfare. We shall miss that after March.

I know Brussels and its form-filling mania has more enemies than friends. But from the end of March, our fate will be entirely in the hands of Westminister.

It is usual to blame politicians when things don’t work out. But our political leaders need to be served by smart administrators and those at Defra will need to up their game. We will need a more imaginative and efficient government bureaucracy to help us deliver.

Exports

Third, the UK will have to export more to offset lost trade to the EU and to our markets in countries with EU trade agreements. Food must be included in the export drive. Usually, farming’s domestic markets are offered up as compensation for increased manufacturing access to third countries. If we are to make a success of Brexit, the UK must break this habit.

In short, Brexit success will depend on the whole sector, the banks and whatnot, and Westminster rethinking our whole approach, battling together, and supporting one another. It has never happened before, except in war, but it has to happen now.

We are looking for a total transformation. It won’t be easy, but there’s no alternative. It’s about to get serious.


Graham Meadows is special adviser to EU farm commissioner Phil Hogan.

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