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Report suggesting half of farms will go bankrupt in a no-deal Brexit a ‘scare story’

A report published by the Farmers for a People’s Vote campaign, which suggested half of farmers will go bankrupt in a no-deal Brexit, has been branded a ‘scare story’ by a leading agricultural economist.

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Report suggesting half of farms will go bankrupt in a no-deal Brexit a ‘scare story’

Independent consultant Derrick Wilkinson, who has previously worked as chief economist at the NFU and CLA, said the claim was based upon the assumption that direct payments would be removed with no other form of support to replace them.

 

Mr Wilkinson was speaking on Farmers Guardian’s latest Ploughing Through Brexit podcast, alongside Sean Rickard, the author of the Farmers for a People’s Vote report.

 

 

He said: “The 50,000 figure is not derived from any of the changes in the trade relationship, it is derived entirely from the withdrawal of support payments and the assumption that nothing replaces them.

 

“I did a very similar analysis about four years ago and came up with exactly the same number.

 

“So we can build a scary story simply from the removal of subsidies, but that does not really address the issue of what the actual effect of leaving with or without a deal is, and that figure I think is significantly lower.

 

“It is probably more in the order of 10-15,000 farms.”


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Mr Wilkinson also hit out at the Government for failing to have a set of policies already in place to mitigate the worst effects of a no-deal Brexit.

 

He said: “In the Agriculture Bill, there is a discussion about some of the structural adjustment transitionary measures which might be needed in order to help the industry adjust, [such as] money for investment and changes in business practice and so forth.

 

“That is all well and good, but it is not coming until whenever the Agriculture Bill returns. This needs to be ready now, so if we end up on November 1 out of the EU with no deal, we have a folder in a drawer somewhere which says these are the programmes we think might help which farmers can apply for.”

 

But Dr Rickard claimed the Government was ‘not interested’ in helping the industry to thrive post-Brexit.

 

Code

 

“Structural change is code for farmers going out of business,” he said.

 

“Of course the industry will survive, it will just be a much smaller industry than it is today and we will probably see a dramatic reduction in farming on the hills and uplands.

 

“The sort of farms which will have a chance of competing in the environment which would turn up after a no-deal Brexit would be large-scale, intensive farms relying very heavily on modern technology, not only on biotechnology, but also precision farming.

 

“You have got to be big to be able to afford this level of investment, you have got to be big to be able to afford the sort of experts you are going to need.

 

“It would be a very different farming industry.”

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