Outcome of Brexit uncertain for farmers

Richard Halleron assesses the impact Brexit could have on Northern Ireland’s farming industry.

 

The voices of our farm industry leaders have been conspicuously muted in the context of the Brexit debate that has been held up to this point. This is very odd, given the scale of the support made by Brussels to local agriculture. In terms of direct payments alone, farmers in Northern Ireland will receive over £1 billion from the EU over the next five years – that’s assuming we stay in of course. But indirect contributions, such as the Rural Development Programme, the contribution made by the EU to our rural areas, is in the region of £2 billion in any five year period.

Of course, all of this would be put at risk, in the event of the UK voting to leave the EU on 23 June. There is absolutely no guarantee that a future Chancellor of the Exchequer will commit to make available an equivalent level of funding in the event of Brexit. The likelihood of this occurring decreases should the Tories remain in power. Since becoming Chancellor, George Osborne has made a virtue of the need for the UK to balance its books and cut its cloth accordingly.

The other big advantage of EU membership is the guaranteed access which UK businesses have to the other 27 member states. Here in Northern Ireland we export more than 80 per cent of the food that we produce and EU markets increase in significance with every year that passes. Again there is absolutely no guarantee that these export outlets would be available to local food companies, should the UK say no to EU membership.

Indeed, the theory put forward by the ‘out camp’ to the effect that Britain will re-negotiate free trade agreements with its European neighbours post a Brexit is pretty far-fetched. These same people point to the existing arrangements that exist between the EU and its neighbours Switzerland and Norway, but they conveniently overlook the fact that neither of these countries were ever members of the European Union. If the UK does decide to leave, the possibility of countries like France saying ‘Foxtrot Oscar’ to all things British is a pretty real one.

Better the devil you know

In truth, farming and food in Northern Ireland have a lot to lose if the UK voting public opt for Brexit on 23 June. Are the campaigns being mounted by the ‘in’ and ‘out’ groups based on scare tactics? Of course they are but where agriculture is concerned, surely, the devil we know is better than the devil we don’t.

The Prime Minister, David Cameron, is urging farmers across Northern Ireland to support a ‘Yes’ vote in the upcoming EU referendum. He made the call during his recent visit to the Co Antrim dairy farm that belongs to the Johnston family.

Cameron hinted strongly that agriculture had much to gain from the EU reform package thrashed out in Brussels a few weeks ago. “Staying in the EU gives our farmers direct and free access to a market made up of 5 million consumers,” he said. “It also guarantees farming in Northern Ireland will continue to have access to all of the CAP support measures which the industry currently avails of.

“In contrast, those supporting the principle of the UK leaving the EU can offer no guarantees whatsoever. This includes the state of the trading relationships that will exist between the UK and Europe, should Britain vote to leave Europe.”

The Prime Minister believes passionately in the bona fides of the deal which he struck with the other 27 EU heads of state. He also disagrees strongly with the view expressed by Secretary of State Theresa Villiers that agriculture could receive higher levels of support, should a Brexit become reality.

“Yes, the UK government recognises the value of farming to the economy as a whole. But if Britain votes to leave the EU, all I can confirm is that the current EU support measures for agriculture will remain in place for two more years. I cannot guarantee that the UK government will continue to support farming to such an extent beyond this date. And no one can. In the event of an economic downturn, following a UK exit from Europe, the money may not be available to support farming on a par with that which is currently the case.”

The Prime Minister said that continuing membership of the EU would help deliver real safety, prosperity and strength for the United Kingdom as a whole. Specifically, where agriculture is concerned, he saw tremendous merit in the EU negotiating trade deals with the likes of India and China.

While acknowledging that Northern Ireland’s milk sector is under tremendous pressure at present, he expressed the view that agriculture, as a whole, can look forward to a bright future. “Dairy farmers are in business for the long-term. International demand for food is set to grow significantly,” he said.

“UK trade missions are currently seeking out new market opportunities for our farming and food sectors. And I am confident that farmers in Northern Ireland will play their part in helping to feed the world.”

Cameron made it clear that those supporting Brexit must come out and clearly articulate their arguments. But, as far as he was concerned, coming out of Europe was “a step in the dark.”

Secondary concern

Meanwhile, The Ulster Farmers’ Union says both sides in the debate on the EU referendum need to set out, in detail, their vision of the future for agriculture and the Common Agricultural Policy. However, it says that to date no ‘compelling argument’ has been made to suggest that agriculture would be better off outside the EU, and that those supporting Brexit need to rise to that challenge.

UFU president, Ian Marshall, acknowledged there was significant interest in the UFU position as the CAP was worth over £230 million a year to farmers here. “We want this to be an informed debate. For farmers, future financial support is the central issue,” he says, adding that with the industry in crisis, the referendum was secondary for farming families and the UFU to getting through a deepening cash flow crisis across all enterprises.

“Tackling this is our current priority, but we will do all we can to encourage debate before the referendum – including bringing both sides together to make their case to farmers.”

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