‘You won’t get paid to own land any more’ – Norfolk farmer Kit Papworth says it’s time to change subsidy regime
- Credit: Archant
Farmers must not expect future government handouts for nothing, and they should shape their businesses to be more efficient in a post-EU landscape.
That was one of the suggestions made by a leading Norfolk farmer as he spoke to rural professionals at an industry seminar examining the potential implications of Brexit on agricultural businesses and finances.
Kit Papworth, a director of L F Papworth, a contracting business based at Felmingham, near North Walsham, was the keynote speaker at the Business for Change seminar, held at the regional headquarters of the National Farmers' Union in Newmarket.
It was the first event to be held by Anglia Rural Consultants (ARC), a new consortium of agricultural business advisers based across East Anglia.
Mr Papworth said he expected the 3.1bn euros currently spent on UK farm subsidies through the EU's Common Agricultural Policy (CAP) to be significantly reduced after Brexit.
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But he said direct support for landowners through the Basic Payment Scheme should be scrapped by 2025, in favour of redirecting all the available funding to environmental stewardship schemes, where there would be a clear public benefit to the investment of taxpayers' money, and research and development which could drive future business efficiencies.
He also advocated the creation of 'profit bonds' – a tax free pot of cash created through profits and held by the government to help fund new projects, retirement plans and protect businesses from future market volatility.
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'We are not doing a terribly good job considering the subsidies we get,' said Mr Papworth. 'More than half of farms make less than £20,000 a year. So there is a lot of lifestyle farming going on here.
'Yields of many of our main arable crops are static at best. Costs continue to rise and commodity prices are more volatile than ever.
'Meanwhile, according to NGOs, the environment is in rapid decline and the public finances of the UK are under significant pressure.
'I think it is time for a change. This is taxpayers' money and the public still think we are doing a good job, so we should capitalise on this now.
'I am going to be bold and say that our 3.1bn will look more like 2.5bn when we get there. If you don't think the Treasury will top-slice our budget, even after what you were told you in the referendum, then you're crazy.
'So why don't we work with what we have got? Let's tell farmers right now that there is not going to be a Basic Payment Scheme. You won't get paid to own land any more.
'We are guaranteed the (CAP) money until 2020, so we will have five years to wind it down and modulate it all over to environmental payments which should be accessible for all farmers. Environmental stewardship is important and should be compulsory at a basic entry level. If we want any money at all, that is what we are going to have to do.
'For all these small farms maybe it is time they got together with the guy next door to reduce their costs. Or maybe they opt out altogether. Some small farms are very efficient, but we cannot pay them to have a three-day-a-week job.
'There will still be some people who can afford to have a part-time role in agriculture but what I am suggesting is that agriculture needs to be commercial.
'There is nothing wrong with small, but small has still got to be profitable. We cannot continue to support farms not making £20,000 a year.
'I think we also need to spend some of our on research and development which propels our efficiency going forward. Without that we cannot replace these people (migrant workers) who no longer feel welcome here.'
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