Britain – and indeed the world – has been rocked by the result of the European Union referendum last week, with 52% of voters backing Brexit. Much has been said about what effect this decision will have so TER decided to take a specific look at what influence the vote may have on farming, as many of our readers work in this industry.
Farmers appeared to be split on this issue before the 23rd of June. The final poll which Farmer's Weekly ran at the Cereals event a week before the referendum showed that 58% of those who took part wanted to leave the EU, 31% wanted to remain and 11% were still undecided.
An important issue which affects UK farmers is the Common Agricultural Policy subsidies which amount to around £2.4 to £3 billion a year, depending on exchange rates. The National Farmers Union has said that the average income of a farmer in 2014 was just over £20,000 a year and 55% of this comes from the EU. Brexit campaigners have said that they will protect these subsidies – and they could, in fact, be increased. However, this will amount to a huge expense for the government and therefore the taxpayer – meaning that this could be a divisive issue for the public.
Many farmers were unhappy about the regulations which the EU enforced for these subsidies to be paid. The Vote Leave campaign said that, with a Brexit vote, regulations would be reduced on farmers. The abolishment of the 'Cross Compliance' regime has been stressed which can fine farmers for flouting EU rules such as those which monitor the size of trees on farmland.
In terms of imports and exports of produce, the Department for Environment, Food and Rural Affairs have said that 60% of our food and drink exports go to the EU, which is worth £11 billion to the economy. Boris Johnson, lead campaigner for Vote Leave, has said that Britain would maintain access to the single market - but this is not guaranteed and will need to be negotiated with the EU. No other country in Europe currently has access to the single market which allows tariff-free trade within the EU without free movement of people – the prevention of which has been important for many voters for Brexit.
All of this has led the NFU to call an emergency meeting of the NFU Council for the 1st of July. NFU President Meurig Raymond has said that this meeting will decide "some immediate indications of the kind of things we will want when we leave the European Union." This same organisation has already said that food prices will have to go up as "a weaker pound will mean higher imported food value" – currently 40% of our food is imported.
Undoubtedly, the EU has been of benefit to farming in ways other than subsidies. The regulations put in place to protect the environment have been a case in point, though not always welcome across the board. The 'green and pleasant land' that we all enjoy is a product of farming as much as it is of Britain's natural topography. Many will hope that the government continues some of the green policies which, to date, have been upheld by the EU.
In reality, we do not currently know how exactly Brexit will affect farmers and the rest of the general public. This will become clearer as Britain's relationship and trade deals are negotiated with the EU. With people from both sides of the argument making wildly different claims about this issue, it would appear that only time will tell the real effect of Britain leaving the European Union.