The Government has made a number of important announcements affecting farming in recent months. Abi Kay from the Farmers Guardian speaks to Defra Secretary George Eustice to get the inside track on the latest developments.
Defra Secretary George Eustice has found himself at the department’s helm during the most tumultuous time for farming in living memory.
Businesses are being squeezed from every conceivable angle, with input costs soaring, labour shortages across the supply chain, increasing regulation, falling levels of direct support and, of course, the prospect of new trade deals on the horizon.
It is on the latter issue that you get the sense Mr Eustice is uneasy with the Government’s direction of travel, though he is always careful to toe the line in public.
In 2019, during his brief time outside Defra, he wrote an article for The Guardian in which he said the Americans would have to ‘learn to abide by British standards’ if they wanted privileged access to the UK market.
But now, the Government has signed an agreement in principle with Australia, while ignoring a recommendation from both the Trade and Agriculture Commission and the National Food Strategy to set out a mechanism to protect standards in trade deals.
Asked whether Ministers were failing to join up domestic policy thinking, which is driving standards up, and trade policy thinking, which is opening the UK market to sub-standard produce, Mr Eustice said: “I do not accept that. We have in the Australia trade deal recognised we have sensitive sectors, in particular beef and sheep.
“That is why we have gone for a tariff rate quota [TRQ] for the first 10 years and then a strong safeguard mechanism after that.
“We are also working on an SPS [sanitary and phytosanitary] statement which will be a clear statement of the UK’s approach when it comes to these issues around food standards in our international trade agreements.”
The SPS statement is expected to be published ‘sometime early next year’, but will come too late to influence the deal with Australia, which refused to sign the global methane pledge unveiled at COP26.
Defending the Government’s position, Mr Eustice claimed the Australians were ‘likeminded in some areas’, and pointed to the idea of a carbon border tax as a way to prevent domestic produce being undercut.
“If countries like Australia were not pulling their weight, that would be reflected in a border adjustment tax as those products enter the UK,” he said.
He suggested this kind of tax would be likely to emerge in the next eight years, before tariffs on Australian imports are fully eliminated, and rejected the idea of a broader carbon tax which would hit domestically produced food, saying agriculture policy would reduce greenhouse gas emissions.
Mr Eustice also insisted that the new Sustainable Farming Incentive (SFI) marked a real break from the Common Agricultural Policy (CAP), despite the fact that larger landowners will continue to receive the biggest payments – a key criticism levelled at the CAP by Brexiteers, including the Defra Secretary himself.
“It is conceptually very different,” he said.
“In future, there will not just be an arbitrary subsidy payment based on the land area you have, it will be a payment for what you do on the environmental assets on your land.”
In the uplands, in particular, smaller farmers are expected to be worse off because the payment rate for the moorland and rough grazing standard has been set so low, at £6.45/hectares.
Mr Eustice attempted to defend the rate by appealing to historical precedent, pointing out it had always been ‘significantly lower’ under the Basic Payment Scheme, but said he expected the payments to go up as the scheme develops.
He also batted away concerns about institutional landlords signing up to environmental schemes with tenants contracted to deliver them, saying this would ‘not necessarily’ take away a revenue stream for tenants.
One other issue causing worry in the industry at the moment is the Environment Agency’s (EA) interpretation of the Farming Rules for Water, which has led to an effective ban on autumn applications of organic fertiliser.
Here, Mr Eustice sought to offer reassurance by saying the Government would issue statutory guidance to the EA in the ‘early part of next year’.
Taken together, all these problems have led to a drop in support for the Conservatives among rural voters.
But the Defra Secretary remains unphased.
“The polls go up and down,” he said.
“The crucial thing for me is I am at Defra in a crucial time of change, where there are some important policy agendas and some big opportunities.”