Fiona Harvey Environment correspondent 

Quarter of rural businesses ‘could be bankrupted by no-deal Brexit’

Conservative rural voter base could be eroded by impacts of crashing out of EU
  
  

Boris Johnson and bovine friend
Boris Johnson and bovine friend: the warning comes on the eve of the Tory party conference. Photograph: Andrew Milligan/PA

As many as one in four rural businesses could be left facing bankruptcy in a no-deal Brexit, and the staunchly Conservative rural vote may be in doubt as a result, the head of the UK’s landowners’ group has warned on the eve of the Tory party conference.

Farmers are particularly vulnerable to a no-deal Brexit because tariffs would be levied on exports, imports of cheap food could flood the market, and because decisions must be made now which will have an impact for the next year. Arable farmers are putting crops in the ground now for spring, and livestock farmers are preparing to breed sheep and other livestock for next year.

Tim Breitmeyer, president of the Country Land and Business Association, said farms and the rural businesses that rely on them were not in a position to absorb the shock of Brexit, and estimates suggested a large number would be in danger.

“Agriculture is not making very much money. In many cases, they’re losing [money] without the single farm payment [subsidy]. If you have a tariff to add to your problems, if you have increased costs to add to your problems, it’s only going to make matters worse and tip some businesses over the top,” he told the Guardian. “Now I don’t know whether that’s 15% or 25% but I’m absolutely sure there will be quite a few farming businesses for which it actually just tips them into receivership.”

Rural areas voted overwhelmingly for Brexit in the 2016 referendum, which Breitmeyer called a “protest vote for the fact that rural Britain got abandoned”. But the reality of new tariffs on exports, rising import costs, the crash in value of the pound and difficulties in employing migrant labour were taking a toll, he said.

“There are an awful lot of people who are really questioning whether next time round that [Tory] is the way they are going to vote,” he said. “I think there will be quite a lot of people who look to see whether the Liberal Democrats [have better policies].

“I’m not saying that Brexit won’t necessarily provide some very significant opportunity in the future, but the added disruption and uncertainty in the medium term, in the short term, is palpable.”

Breitmeyer is calling for the government to provide support for farmers hit by any new tariffs, alongside a “massive, massive push” to encourage people to buy British produce, and “almost an edict to public procurement, that they have to buy British”, as the only way to keep farms in business.

He predicted it would be “very difficult” for the UK to keep out chlorinated chicken from the US, quoting an American agricultural attache who told him: “If you want to keep more high standards, then you get your public goods [subsidy] system to pay for the high standards.”

The Conservative party conference scheduled to begin this weekend will be a platform for rural voters to show their concerns. The government has pledged to retain farm subsidies at the same level as those from the common agricultural policy until the end of this parliament, but has yet to set out how it will revive the agriculture bill – which would put in place the mechanisms for a new subsidy system – and the environment bill. “It’s now more than 300 days since the agriculture bill last appeared in parliament,” noted Breitmeyer. “So we sit in a morass of uncertainty.”

Another sacred cow for the Tory party conference that Breitmeyer wishes to slaughter is the planning system, which he said was “the number one barrier to growth”. Attention has focused on the housing crisis in cities, but it bites in rural areas too, he said, as young people cannot afford to stay and a lack of transport and other infrastructure discourages the young, old and those on low incomes.

“There aren’t enough houses and there certainly aren’t enough affordable houses for young and old to remain in their communities,” he said. “All of us, as landlords and landowners, we have villages that we treasure, villages that we understand. And we could all contribute to the nation’s housing crisis and drive growth in the rural economy by having people living there and working there. We can deliver for society.”

Breitmeyer also called for urgent government action to extend broadband to rural areas, where he said rural businesses and farmers wanting to diversify were being held back by a frustrating lack of fast internet connection. At least 500,000 households in rural areas lack broadband and mobile signals are often poor. “[The rural economy] could be a real engine for growth, if given the tools to do it with. But you can’t run a business on 1.2Mbps and no mobile signal.”

 

Leave a Comment

Required fields are marked *

*

*