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Productivity, volatility mitigation and environment at heart of NFU’s vision for future ag policy

The NFU has set out its vision for a new domestic agricultural policy in a landmark report.


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Abi   Kay
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NFU president Meurig Raymond
NFU president Meurig Raymond
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NFU sets out vision for future agriculture policy

The paper lays out several possible options for Government to take to mitigate volatility, improve agricultural productivity and enhance the environment.

 

It also recommends Ministers look at other policies around planning, rural connectivity, tax, regulation and trade deals to ensure farming businesses can thrive.

 

NFU president Meurig Raymond said: “There is rightly an exciting and energetic debate at the moment about how farm support should be delivered once we have left the EU.

 

“Our framework makes the strongest possible case for a coherent approach that means farmers can continue to do what they do best – producing safe and affordable food to the high standards the public expects, while caring for the environment in which they operate.”

 

Here, we take a closer look at what the NFU is calling for.


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Suggested options to mitigate volatility

Deferred tax savings schemes

 

These allow farmers to put aside pre-tax profits in good years and draw them down in difficult times or when they need to make investments.

 

Counter-cyclical payments

 

These support farmers’ incomes when prices or revenue fall below a certain level. The level could be set by Government or be based on historical averages.

 

Revenue insurance schemes

 

Revenue insurance targets support at farmers who have been affected by a significant fall in market prices or yield.

 

Margin insurance scheme

 

These schemes insure farm business production margins against a fall relative to average margins in previous years. NFU points out Canadian model complex, expensive and difficult to access.

 

Futures markets

 

Futures markets allow farmers to pass on the risk and reward of volatile markets to investors who agree to buy specific quantities of a commodity at a certain price and time.

 

The NFU points out futures exchanges for milling wheat and dairy are in the EU and the introduction of any trade barriers may limit farmers’ ability to use them.

Actions for Ministers to take now to mitigate volatility

  • Improve provisioning and reporting of market data
  • Pilot revenue insurance schemes
  • Establish a ceiling for ‘Amber Box’ measures at the World Trade Organisation. Some measures used to combat volatility are considered trade distorting and countries have agreed limits on how much they can spend on them.

Suggested options to improve productivity – available to all active farmers

Facilitate research, development and innovation

 

Productivity funding to ensure R&D findings disseminated and understood by farm businesses, with opportunities for farmers to get involved in research to keep it commercially relevant.

 

Improve skills and training

 

Farmer-to-farmer learning to be funded to boost sharing of new approaches and best practice. Demonstration farms and farmer-led day visits to take centre stage.

 

Develop advisory services

 

AHDB to support strong advisory service designed to improve competitiveness and support sustainable practices. Advice on navigating grant funding, accessing training and other services to be available.

 

Remove financial barriers to investment

 

Grants to be central to future policy. Loans where repayment frequency and amounts are linked to changing business returns to be set up, and public bodies to offer guarantees for private investment.

 

Invest in technology

 

Investment in technology to be focused on improving resource efficiency, advancing genetic and breeding gains, saving labour, improving animal health and welfare, managing disease or adding value to raw products.

Actions for Ministers to take now to improve productivity

  • Develop public-private partnerships to deliver pilot schemes
  • Invest in IT such as data systems which enable two-way flow of livestock movement and carcass quality reporting
  • Improve functioning of existing funds to improve farm productivity

Suggested options to enhance the environment

First tier of policy

 

A first tier available for all farm types and sizes. Options simple to comply with and deliver for the environment.

 

Second tier of policy

 

Second tier for more ambitious environmental outcomes, with conditions to support complex management. Tailored to local needs, with bespoke support.

 

Payments

 

Payments to cover the full cost of delivery as well as future losses. In-built flexibility for tenanted and common land arrangements, with cash going to the person undertaking the work.

Actions for Ministers to take now to enhance the environment

  • Put farmers at the heart of future policy development
  • Pilot new approaches such as results-based schemes
  • Improve current Countryside Stewardship scheme and use it to test new features
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