Farmers must rely on handouts when they are so badly underpaid

IT is simple mathematics that farming in this country is heavily dependent on the financial support it receives from the European Union.

Farming is in crisis because of plummeting prices and subsidies are a lifeline - when they are paid on time.

When prices paid to farmers for their produce is low - as it is now across every farming sector during what is an abysmal period of volatility - the subsidies that they receive are vital for sustaining many, though even then not enough for others.

When prices are healthier, not only do they help those farmers whose businesses have survived the hard times to recover, but the money is used to invest in more sophisticated farming technology which can improve animal welfare and help produce more food with greater efficiency than before - surely a prerequisite for a country with a bulging population that is increasingly putting pressure on our green spaces.

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Farmers are proud people and are not keen on the word ‘subsidies’ as it gives the impression of an industry that relies on handouts, but that is the truth and financial support remains a necessity in a European environment where their farming counterparts in neighbouring nations receive the same such support. It is crucial that our farmers have a level playing field on which to compete in international markets.

Payments are also a necessity because of the attitude of too many retailers that use produce such as milk as a loss leader. The consumer gets a cheap price but the farmer, whose cows produced the milk in the first place, receive prices at the farmgate that have consistently been below the cost of production for 18 months now. This has been an untenable situation for many, with as many as three Yorkshire dairy farmers a month quitting the industry.

In these circumstances, farming would collapse without the £1.8bn paid out to them each year by the Rural Payments Agency - the body that administers EU payments on behalf of the British government.

EU membership also guarantees access to the European Single Market, by far and away British farming’s biggest customer, and uncertainty over what access Britain would have to this market outside of the EU is among the factors that leave many unsure which way to vote.

The single market gives UK businesses access to the world’s largest economy and the world’s largest agricultural trader.

According to 2014 figures, the UK imported nearly twice as much food from other EU member states than it exported, but Britain’s export market remains an important one - some £12.8bn of British agri-food was imported by our European neighbours in 2014. It is a market which Britain can ill-afford to be affected by the outcome of the referendum.

A Brexit report produced by the Farmer-Scientist Network, a group which is supported by the Yorkshire Agricultural Society, warns that the UK could have to sign up to single market rules without having a say in making them.

“A free trade agreement would be optimal from a UK perspective, but will not be easy to secure and would require some conformity to EU rules,” the report states.

Overall, the Network’s report concludes that it is difficult to see exit as beneficial to the UK farming sector, and that it should be borne in mind that British farmers benefit to some extent from the Common Agricultural Policy due to the fact that other EU member states derive a greater share of their GDP from agriculture.

Politically, the view is of course divided and so too within the Department for Environment, Food and Rural Affairs itself.

Environment Secretary Liz Truss is backing the ‘in’ vote, while Farming Minister George Eustice wants ‘out’.