Jeremy's Blog 23rd June 2023: Improving Farming Productivity - Change not Protection

This article by Jeremy Moody first appeared in the CAAV e-Briefing of 22nd June 2023

Something needs to wake us up about the extent of economic stagnation in the UK (and the EU) since 2008, resulting in our current crisis with low incomes in the face of costs. Not only has our flat-lining since 2008 broken from our growth trend since the eighteenth century but the USA gives a current comparison – as ever with issues - showing a strikingly different story over the last 15 years:

• in 2008, before the financial crisis, the total size of the EU economy (then with the UK) was some 10 per cent larger than the US - $16.2 trn compared to $14.7 trn
• in 2022, the US economy had grown to $25 trn a quarter larger than the EU and the UK combined at $19.8 trn.

We might feel that cultural differences and non-economic benefits balance some of this but, in the end, la dolce vita and lifestyle would not pay for the health service, defence or housing that people want. Current economic concerns do not suggest life is sweet for many - with social and political consequences. Not changing is a choice, albeit the easier, broader path disquieting fewer people immediately but letting worse problems gather.

Many of the remedies lie in our hands, involving greater openness to change, easing business, opening opportunities with flexibility rather than protection. A new approach to planning policy is at the top of many lists, whether to answer the shortage of housing, facilitate business or enable infrastructure.

That new approach is needed to enable the transition to fully renewable power with gathering discussion of on-shore generation at the necessary scale and the essential connections to the grid. Yet many green advocates intuitively resile from the major change that would achieve the green economy while the climate is bringing change anyway. Fully renewable electricity could also remove much of the climate argument for imposing energy efficiency on housing with all the difficulties of that.

These issues are as important for our agriculture as for the rest of the economy. As elsewhere, the answers to farming’s productivity challenge, its business efficiency, include innovation, investment and skills. They also include greater openness of land occupation markets for farmers to start, progress and withdraw – with a recent young farmers survey showing they want land to farm, not other uses. Delivering answers for farming is more closely entwined with key environmental concerns than most other business.

One point of consistency has been DEFRA’s agricultural transition policies, now felt on the English farm in this pivot year of 2023:

• withdrawing Basic Payment (with its reward for occupying land) sees farming treated as a business with capital support for investment in productivity and innovation, the new TIAH to support skills and now in its response to the Rock Review recognising the need for a flexible and diverse let sector
• re-using the money released principally for environmental agreements with the now much enlarged SFI offer soon to be joined by the enhanced Countryside Stewardship Scheme as options for businesses but with targets and regulation behind.

Work on land use unifies these two strands. Practical and economic logic point to the greatest outcome in food and environmental benefits coming from an emphasis on specialising land uses, a bias to “land sparing” rather than the larger compromises of “land sharing”. Good farming will have to meet environmental requirement and individual farmers will have their own choices.

All this means change, a basic part of life with adaptability to change an integral part of the human character. It is better to be open to the future, manging change well, than allow an inheritance to become uneconomic, leaving a poorer country. The choices are ours.