George Eustice: “We haven’t left the EU just to be told what to do by other countries”

Posted On: 
9th July 2018

As a seasoned Brexiteer, George Eustice is well versed in how the European Union impacts Britain’s agricultural sector. Now, as minister for Farming, he is responsible for carving out policies to shape the industry’s future outside of the EU. He talks to Nicholas Mairs

Farming Minister George Eustice
Louise Haywood-Schiefer

George Eustice’s eurosceptic credentials are convincing. The former Referendum party activist, who once stood to be a Ukip MEP, cut his teeth with a four-year stint as director of the campaign against the UK adopting the euro. He was among the first of his colleagues to break ranks and declare for the Leave campaign in the referendum.

And, despite mounting warnings about the impact of Brexit on the farming industry (for which he is now the minister), Eustice says it was the EU’s effect on the sector that drove his anti-Brussels views.

Having left college to begin work on the family farm, the Cornishman became aware of how “badly affected” his kin were by Britain’s short-lived entry into the European Exchange Rate Mechanism in 1990 and the “debacle of sky high interest rates” that followed. “That made me quite sceptical about the way things worked in the European Union, or didn’t work,” he explains.

Nearly two decades on and Eustice is now at the forefront of shaping how the country cuts ties with the European Union. But cautionary tales that grave risks lie ahead from leaving still remain.

A Sunday Times scoop in June revealed Whitehall was preparing for a no deal outcome known as the “doomsday” scenario. It saw Eustice’s own patch of Cornwall named alongside Scotland as regions that under a sub-category of “severe” – a notch below “Armageddon” – would see shortages in food within “a couple of days” and the collapse of the port of Dover on day one. While he passes off the chance to comment on one of the more unsettling post-Brexit visions, Eustice admits a no deal outcome is not the government’s “preferred option”.

“It is an option that we’ve done some contingency planning for,” he continues. “And I think it’s important for this reason: if you want to be serious around the negotiation table and if you’re serious about trying to get a good deal, you do have to be willing in the final analysis to walk away and if you’re saying you wouldn’t countenance a no deal outcome, you’re undermining your own hand at the negotiating table.”

He adds: “Given that we’ve got a trade deficit of £60bn a year with the EU, some £18bn in food and drink alone, it really is in their interests to try and conclude a free trade agreement with us. They may feign indifference, but it really does matter to economies like Ireland and Denmark.”

Not everyone shares his certainty that a deal will be struck. The National Farmers’ Union (NFU) says staying part of a customs union is “absolutely vital” for a sector which sees 40% of its lamb, 80% of dairy and 75% of wheat and barley head to the continent.

Eustice concedes that falling out on World Trade Organisation terms could hit parts of the sector, but insists others would reap the rewards. He points out that for all the fear of being without customs ties, it was once perceived wisdom to oppose them.

“If we ended up in a favoured nation scenario, under a so-called WTO rules scenario, the analysis that the NFU themselves have done shows that while there are some sectors that would be affected, notably lamb and barley growers, in many other sectors actually farmers would see a firming in farm prices because there would be less imported competition,” he says.

“If you go back to the 1950s, when the settled political view was that we shouldn’t join the then European Economic Community, that we should stay a member of the European Free Trade Association and have a free trade agreement but not one where we had a customs union, the arguments were very much around the detrimental impact on agriculture of joining a customs union.”

He continues: “So, often with these things there’s a fear of change, but the NFU’s own analysis suggests most sectors in agriculture wouldn’t have a lot to fear from a favoured nation scenario. But that doesn’t alter the fact we’re a free-trading country, we believe in free trade, a free trade agreement is what we’re seeking.”

The NFU-commissioned report’s assertion, as cited by Eustice, that a welcome rise in some commodity prices could be the result of Brexit, rests on what they see as the unlikely scenario of Britain adopting a protectionist approach to import tariffs. On top of that, they say the sector would need the guarantee that support payments will continue at their current level.

The latter issue, of what exactly will replace the £3bn EU Common Agricultural Policy payments, is similarly troubling for farmers. Defra has secured a promise of continued funding until at least 2022, but how the new environmentally-conscious system enthusiastically proposed by Michael Gove will run and how it will be funded thereafter remains on ice until the Treasury gives further notice.

Eustice insists the change in focus from a scheme where the reward is based on land mass, skewed rent costs and even undervalued food, to the new model, marks the chance to correct a flawed approach.

“If you think about what a coherent policy looks like, an arbitrary subsidy based on how much land you have doesn’t look like a coherent policy fit for the 21st century,” he adds.

“One where its targeted payments to deliver environmental outcomes, higher animal welfare, reduced use of antibiotics, targeted interventions, behaviours change and a different approach to farm husbandry: then you’ve got the makings of something quite exciting.”

Also hankering for a solution is the fishing industry. We conduct our interview on the terrace at the Houses of Parliament, yards from where fishermen demonstrated their fury at EU rules by drafting in Nigel Farage to symbolically hurl haddock from a trawler into the Thames.

Antipathy to EU fishing quotas was the go-to injustice for committed eurosceptics, easily illustrated through an island being deprived of its own abundant resource. But as Britain takes it first step out of the bloc through the transition period, it will be anchored to the continent. Eustice says despite the government sparring with the bloc, it was a fight that could not be won.

“We argued very strongly that fisheries should have been excluded from the transition period, we were very clear as a government, we didn’t think it was necessary for it to be covered by the transition period,” he says.

“But, look, in the end the point that the European Union made was that it’s a very short term, limited to the transition period and they weren’t willing to get into detailed conversation on how we might deal with things differently.

“The bottom line is it matters to our people who are trading with the European Union to have access to the market and to have that certainty for a period of time until we’ve resolved the future economic partnership.

“It also matters to sectors in fishing as well, in particular the shellfish sector. People producing crabs and lobsters want access to that European market, and we just took the view that this is a time limited period, and it’s important to give us the space to prepare for Brexit.

“We took a decision that we would not bother arguing about the nature of the transition period and instead reserve our efforts for arguing about the end state. For us, we need to keep our eyes on the prize, which is an independent fisheries policy, controlling access to our own waters after December 2020.”

Public hostility to Brussels’ jurisdiction on fishing sits in marked contrast to the the widespread appetite for the EU’s typically high food standards. Amid reports of a Cabinet rift between Liam Fox and Michael Gove over whether to relax regulations regarding chlorinated chicken, a poll for the Independent showed a whopping 82% of the British public believe keeping current rules in place should be a priority over securing trade, compared to just 8% who said they would not object.

But how do Defra ministers ensure the right balance, when it comes to securing a future trade deal with the ‘America first’ President?

“Our stance as a country should be that we have values and standards that we will not abandon, and that we take animal welfare very seriously and we want to project our values on animal welfare around the world, but that we are a liberal free trading country,” he replies.

As the government continues to thrash out a viable trade relationship with Europe, Eustice says the nature of a future deal with the US will be more clear-cut when the time comes.

“As a country, we’ve just got to get less spooked by what other countries might ask for around the negotiating table. Whether that’s the EU or indeed other countries with whom we might do future trade deals.

“Having a sensible discussion on a particular tariff rate quota – what we call a TRQ, which is a tariff free allocation from a particular country – that’s one thing. But asking us to change our rules and regulations, that’s a bit of a no-go area as far as I’m concerned.

“We haven’t just left the European Union just to be told what to do by other countries.”