Lord Haskins: Ten years after foot and mouth, the good sense of country folk will help them in another crisis

The devastation caused by BSE was still fresh in people’s minds. The pound was strong and therefore farmers were struggling to compete with cheap imports. Rural communities appeared to be in decline and neglected by the government. Then came the traumatic pictures of burning carcasses and the frightening evidence of a disease spreading rapidly and getting out of control. Several months after the onset of foot and mouth, it was still rampant in Cumbria and North Yorkshire. Tony Blair, after a tense visit to the stricken areas, asked me to look at the situation and advise him as to what the government should do.

My appointment was not well received by some farmers. For several years, the slogan “Cull Haskins” was daubed on a wall in North Yorkshire. The seamier side of the tabloid press questioned my neighbours in a vain attempt to dig up salacious stories about me. I recall sitting in the back of a London taxi when the driver launched into a tirade against “that Haskins”. He went strangely quiet when my colleague asked if he would like to be introduced to the same villain. I never quite understood why I attracted such warm feelings. In my report, I observed that the countryside was very resilient and would recover from the catastrophe quicker than might be expected. However, I urged various rural groups to stifle their differences and work more closely together to tackle the longstanding problems of rural society – a declining ageing population, housing shortages, under resourced public services, the plight of small livestock farmers, the need to diversify and inadequate internet connections. I also managed to persuade the government to provide some modest financial support for those who continued to be badly affected by the outbreak.

So, 10 years later, what is the state of Yorkshire rural society? As ever, the variations across the county are enormous. In my own area, the East Riding, arable farmers are enjoying a bonanza because of high cereal prices driven by global shortages and a weak pound. (However although we sold some wheat recently at £200 a tonne, compared with £75 five years ago, our average price for last year’s harvest will be about £136).

But these same high prices are giving livestock farmers, especially dairy and pig, a hard time. The liquid milk processors, aided and abetted by supermarket buyers, recklessly pursued increased market share, cut prices and created far too much capacity in the market. Then, in order to pay for this extravagance, they reduced the price they paid to the farmers. This is a disgrace.

The rural economy shared in the national prosperity which came during the first seven years after the outbreak, thanks to a thriving tourist trade, extensive diversification (for example, local markets), a rapid extension of internet activity and increasingly affluent rural communities. A substantial influx of East European workers into the countryside pointed to a shortage of English workers who had the application or the skills for work in the farming and tourist industries. Rural unemployment was negligible.

Sadly, much of this prosperity proved to be a mirage built on a reckless increase in personal credit. The bubble exploded with the unforgivable collapse of the banking system in 2008. Today, this country, more than most others, is struggling to cope with the worst financial crisis in living memory.

My hunch is that country people, being older and more prudent than their urban neighbours, have suffered much less as a result. They seem to have borrowed less and to have speculated less in property. Indeed the soundest property investment has been in good arable land, whose value has trebled in the last 10 years. The only borrower who will get a friendly hearing from the besieged and discredited banks is a landowning farmer.

That in itself, indicates that future prospects for most farming activities looks good, as global demand for food strengthens while supplies are already being affected by extremes of climate change. It is a sad reality that farming thrives while the rest of the economy suffers, and vice versa. Furthermore, while forecasting exchange rates is a dangerous business, I would not be surprised if the pound remained weak against all the other major currencies, including the much criticised euro, because of fundamental flaws in the British economy.

The non farming side of the rural economy, therefore, will probably find life much more difficult in the years ahead. For understandable reasons, the people in the countryside have been especially dependent on key public services, notably transport. These will be severely cut back both by central government and local authorities.

Having been a board member of Yorkshire Forward, the regional development agency, I know how much support it provided to the rural economy, including small business grants, during the foot and mouth crisis, as well as extensive investment in developing market towns and in the expansion of the tourist industry.

Sadly, Yorkshire Forward is being wound up. Defra’s budget is also being severely cut – with some justification – but all this will mean less support for the rural economy.

Paradoxically, although the majority of rural voters are Conservative or Liberal, they have historically done better under interventionist Labour governments so a coalition government may well be less responsive to the demands of the countryside.

Despite these setbacks, as well as the continuing demographic trends in the countryside – fewer young people, fewer, bigger farms – I believe that the rural economy, while inevitably being damaged by the consequences of the banking scandal, will be more resilient and better able to cope with these events than the rest of the country. That is due to the robust entrepreneurial characteristics of country people – combined with their prudent common sense.