Paterson clarifies stance on post-Brexit subsidy

Former Defra Secretary Owen Paterson has sought to clarify his stance on agricultural subsidies post-Brexit, following what he described as a misleading article by the Mail on Sunday, reports Alistair Driver.

Mr Paterson confirmed that wants to see ‘food subsidies’ phased out within a few years of our departure from the EU as part a drive towards cheaper food and a much freer global food trading policy.

However, he insisted the agricultural sector should continue to be supported but said payments should entirely be focused on delivering ‘public goods’.

“That was the part the Mail article completely missed out,” Mr Paterson told Farm Business, in reference to the article that quoted him discussing a paper by his UK 2020 think tank on UK Agricultural policy post-Brexit at a private meeting of Conservative MPs.

“In reality we could maintain payments to the agricultural sector at the same levels or higher but the key point is that the funding must be targeted to provide public goods, in particular environmental and conservation work and also preserving the landscape for tourism.”

The UK 2020 paper, published in January, sets out how leaving the EU Customs Union could ‘boost exports and result in lower prices for all consumers’.

The paper estimates this could help deliver a 10% reduction in the cost of food, representing a saving of £8.2 billion per year, or £305 per household.

This policy requires maintaining existing trading agreements which the UK presently enjoys with over 50 countries around the world, and also fostering new ones to open up free trade both ways.

The UK can only pursue this policy as far as food is concerned if it scraps the current subsidy regime, Mr Paterson insisted.

Controversially, the paper says there are ‘clear lessons to be learnt from the approach followed by New Zealand in the 1980s’, where subsidies were slashed overnight, causing significant pain, in the early years at least.

“Relieving farmers of overbearing bureaucracy and allowing them to embrace the latest technologies will encourage food-producing areas to become globally competitive without production subsidies,” the paper said.

Mr Paterson conceded that subsidies could not be removed overnight but suggested a phase-out period of around five years.

He refuted the suggestion that the policy could result in UK farmers being put out of business by cheaper, lower standard imports, insisting Government could negotiate common standards in new trade deals.

However, his advocacy of a cheap food policy will still cause nervousness within the farming industry.

Responding to Mr Paterson’s comments in the Mail article, NFU deputy president Minette Batters said: “There is a lot of hype spoken about New Zealand. It is an entirely different natural environment, and after all the changes they have endured the country has the highest rate of farmer suicides in the world.”

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