Agriculture and Horticulture

Earl of Arran Excerpts

Thursday 7th July 2016 Lords Chamber

[The Earl of Arran (Con)]

My Lords, in our family my wife is the farmer and we farm in the beautiful dairy fields of north Devon. As other noble Lords have said, it is hard to exaggerate the magnitude of change that the referendum result will enforce on the rural economy. This will require not only a review of British farming policy but also a greater understanding of the critical importance of sustainable agriculture to our rural communities. The facts help to spell out the scale of the challenge. As noble Lords have said, food and drink is the UK’s largest manufacturing business with 7% of GDP. Farming received £2.4 billion in 2015 from CAP with an additional £4 billion allocated to the UK for rural development programmes between 2014 and 2020. On average, therefore, every farm receives an average of £13,000 per annum.

In the south-west, there are around 25,000 farm businesses—24% of all English farms—with 60,000 employees and, crucially, 200,000 indirect employees. We calculate that every farm supports around 25 other businesses. The referendum result is a huge opportunity for the Government to unlock the vast potential of a revitalised agricultural industry, to the benefit of not only the rural economy but national wealth. It is a real chance to ensure that agriculture is a sustainable and profitable long-term business rather than one that continues to require subsidy.

Opportunities are there in abundance. Take, for example, food production. Currently the UK produces only 60% of its capacity. With population growth and rising cheaper imports, this is predicted to drop below self-sufficiency by 2030. By supporting the great British food initiative and the long-awaited 25-year food and farming plan, production could achieve 75% of our requirements and, at the same time, increase food and drink exports around the world, which are currently this country’s fourth-largest export sector. This could create double the number of direct and indirect jobs, with obvious benefits to the whole rural economy. Importantly, many of the jobs would be attractive to our next generation.

In the south-west, we have seen too many young people leave the industry. We have, however, been market leaders in encouraging women to develop farm diversification enterprises. Here again, a rich prize can be achieved. Greater links between agriculture and tourism would also transform the prosperity of the south-west: amazing food equals amazing gastronomy plus beautiful landscapes equals happy visitors all year round.

To concentrate just on the importance of food production tells only half the story. Farms, through their land stewardship programmes, also provide a wide range of eco-system services. These include helping to improve water quality, being at the front line in helping to reduce flood risk and making a vital contribution to renewable energy supplies. Here again, this extends the influence of agriculture right across the rural economy and helps to ensure that rural services can be maintained.

So what must the Government do to ensure that agriculture and the rural economy can now reach their full potential? First, they can ensure that Defra is adequately resourced to meet the challenge of unpicking the European project while driving new front-line business. Secondly, they can ensure that, as a minimum, current funding for the agricultural industry is maintained with a guarantee that this will be ring-fenced for at least five years to allow confidence to be rebuilt and investment decisions to be made. Thirdly, they can ensure that there is not a shift of capital investment priorities from shires to metropolitan areas. Fourthly, they can rural-proof council tax, which is already significantly higher per head of population in rural areas compared with urban areas due to historic underfunding of rural services by successive Governments. In short, the challenge is for the British public to support the rural economy and our farmers, but will the Government respect the voice of the people? Again, in short, they must.