_Michael Gove on his vision for a brave new world of UK food and farming

When Amber Rudd the Home Secretary finally bows to the inevitable and announces her resignation on the last Sunday evening of April I quickly check to find out who her likely replacement might be. With very short odds, just behind Sajid Javid, the bookies have Michael Gove as second favourite. I panic.

I’m nervous not because I don’t wish Mr Gove well in his career, but because the very next day we’re due to swap questions and answers for this interview. It’s always been at the back of my mind that such a high-profile and experienced minister might not stay at Defra for very long.

Ross Murray, the recently appointed Chairman of Knight Frank’s restructured Rural Asset Management team and immediate past president of the CLA, is also concerned when we exchange emails. “We were delighted when he was appointed, we felt that we had a big hitter we could do business with.”

It has also been surprisingly easy to persuade the minister to be interviewed, so I feel a bit like an angler about to lose a fish after doing all the hard work.

Usually government ministers take some chasing, but Mr Gove responded with alacrity; perhaps because he is keen to share his vision for farming with as wide an audience as possible, it probably also helped that he had an excellent working relationship with Ross while he was at the CLA.

Above: Michael Gove with Knight Frank's Ross Murray when he was CLA president

Mid-morning the next day it’s confirmed that the political firmaments have aligned for Mr Javid and that he will take over from Miss Rudd. The nerves stop jangling. The interview proceeds.

However, not everybody will be so relieved. Mr Gove’s proposals for agriculture post-Brexit have received far from universal approval from the industry. In fact, as the results of our latest Rural Sentiment Survey show, many people believe he is too focussed on the environment aspect of his brief, at the expense of profitable farming.

I put it to him that while his focus on a green Brexit has been welcomed by conservation groups, farmers have for some time felt that their voices have not been heard when creating new policy, particularly since the old Ministry of Agriculture Fisheries and Food became Defra in 2002.

Mr Gove is adamant that he and the government are listening. “Farmers have always been one of the most important voices at Defra and we value their detailed contributions to our policy work,” he claims.

The minister though makes it abundantly clear that when it comes to influencing him it’s not about who shouts loudest, but who can present the most coherent arguments.

“One of the reasons why we recently funded a new Livestock Information Programme to improve traceability and transparency was the excellent arguments put forward by stakeholders from across the meat and livestock sectors,” he explains.

The big test for how well the farming community can put forward its arguments is the public consultation (which closed on 8 May) on Mr Gove’s game-changing blueprint for the future of English agriculture after the UK leaves the EU: Health and Harmony: the future for food, farming and the environment in a Green Brexit.

“It is my view that the more people who participate, the better. We want to create a future farming policy that works for everyone, including consumers and environmentalists.”

But Mr Gove is at pains to emphasise that he recognises that being a farmer and caring for the environment isn’t mutually exclusive. “We must remember that 72% of our land is managed by farmers and it is their hard work that will ensure a vibrant rural agricultural sector for the future.

“It is farmers and land managers who care for our soils, plant our trees, provide the food we eat to keep us healthy, and create the natural environment that we all cherish. Farmers are some of the best environmentalists this country has.”

One of the biggest step changes proposed in the Health and Harmony document is that instead of receiving support payments based on how many acres they manage, farmers will have to deliver “public goods” in return for “public money”.

These public goods will be based around the idea of “natural capital” or “eco-system services”. The theory is that markets will spring up around the delivery of these eco-system services, which could include climate change mitigation or flood prevention. Farmers will deliver the benefits and stakeholders, like government and increasingly the private sector, will pay for them.

It all sounds great in principle, a virtuous circle, I venture, but how confident is Mr Gove that Defra can start a market that uses the concept of natural capital as a basis for environmental delivery in time to replace the current system of farm support, which is due to be phased out by 2025?

“In January, we used natural capital principles to guide our ambitious 25-year Environment Plan. Now we need to put that plan into practice, which will include developing a clear set of metrics to assess our progress.

“We will also be setting up an advisory business council to make recommendations on how natural capital markets and business can help to deliver these goals, and what measures government can take to help businesses to become more environmentally entrepreneurial.

“Underpinning all this work is the principle that public money will be spent on public goods, such as environmental enhancement and public access. We will be awarding this funding through new, more sophisticated, agri-environment land management schemes that use natural capital accounting to identify clear goals and targets.

“We are working with farmers, land managers, environmental experts and businesses to pilot new ideas for these schemes, including the possibility of payment by results, conservation covenants and reverse auctions.”

But the minister makes it clear that the government won’t be doing all the heavy lifting.

“The short answer is, yes we can start a market that uses natural capital accounting as the basis for environmental enhancement, but the size of the market and how quickly it emerges will be determined by the response of farmers, land managers and other businesses to our new policy frameworks.”

One of the biggest criticisms of Health and Harmony is that it spends an awful lot of time dwelling on things like eco-system services, but relatively little on profitable and productive farming.

How does he square the need to help the environment while encouraging farmers to produce more affordable food, which in truth is the priority for most consumers, I ask Mr Gove. Any increase in their grocery bills, I suggest, would not be considered an acceptable outcome of Brexit.

The uplands could benefit from Michael Gove's focus on natural capital

Again, he returns to his belief that “environmental enhancement and good business are not mutually exclusive”. “For a long time, environmental activism has been considered an expensive ‘extra’. By delivering a green Brexit, we hope to show that more efficient use of natural resources goes hand-in-hand with brighter financial margins.”

Mr Gove, a keen Brexiteer, also makes it clear that he believes that the EU’s Common Agricultural Policy, rather than helping farmers, has been holding them back.

“Our new farming policy needs to incentivise the kind of entrepreneurial behaviour that has been discouraged by CAP policy and its Direct Payment schemes, which pay out largely on the basis of the amount of land farmed, regardless of business management.

“Like any business, it is the attitudes of individual farmers and land managers that make the most difference to their productivity and environmental performance, rather than the size of their farm or business. We want to incentivise the right kind of behaviour and emerge with an agricultural industry that leads the world in both productivity and sustainability.”

It’s a view that most farmers probably don’t disagree with; many say they welcome the opportunity to make their own way in the world. Indeed, according to our Rural Sentiment Survey respondents, “a more efficient and innovative agricultural industry” will be the biggest benefit of Brexit for the sector.

But many are also concerned about the rate of change. In reality, a significant number of businesses are unprofitable without subsidies.

How long is Mr Gove prepared to give the industry to adapt before pulling the plug completely on the old system?

“There is no doubt the current system of direct payments has held back the industry. In many cases these payments have raised land prices and rents and stifled innovation,” he says.

“They have imposed unnecessary bureaucratic burdens on farmers and have delivered little for the environment. And that is why we have proposed moving away from direct payments in England.

“We do recognise, however, that farming has a longer than usual business cycle, and farmers need time to adapt to our new system of payments. That is why we have proposed to continue direct payments during an ‘agricultural transition period’, which will last a number of years beyond the national ‘implementation period’ once we have left the European Union.”

He doesn’t, however, give a specific timetable suggesting that he will be guided by the responses to the Health and Harmony consultation.

"We have proposed gradually reducing payments during the transition period to free up money to provide alternative forms of support. A major part of our consultation is seeking views on the fairest way we can apply these reductions, and the length of this ‘agriculture transition’ period.”

Trade

Aside from replacing CAP, one of the biggest concerns for the farming industry is trade. Agriculture is arguably the sector of the UK economy that is most dependent on the EU and would be hit hardest by a “hard” Brexit – especially if we trade on WTO terms with the rest of the world. I’m keen to know if that is acknowledged by policymakers.

“The food and drink industry is our largest manufacturing sector and of course it is at the forefront of our minds. In the last few weeks I hosted a roundtable with some large players and smaller companies to hear their most pressing concerns,” he reassures me.

However, in terms of our future relationship with Europe, Mr Gove is really only able to share the party line: “I am clear that future trade with the EU must be as frictionless as possible, and I am hopeful we will achieve a comprehensive free trade agreement that is of benefit to both sides.”

And what does Mr Gove see as the big wins for our relatively high-cost farming systems in terms of trade post-Brexit when even South African chicken farmers are complaining they can’t compete with imported product from the US?

“Just this year, the Prime Minister secured a huge amount of new trade with China, which entered our top ten markets for the first time in 2016 after almost 50% growth in trade, including in parts of the animal we don’t eat in the UK, like pigs’ trotters.

“Varied expansion like this helps farmers to spread risk and become more resilient in competitive global markets. In fact, since 2015, we have opened or improved terms for 163 markets for animals and animal products.”

But he’s quick to parry the obvious follow-up question about the impact of the reciprocal increase in imports that will be part and parcel of any further trade agreements.

“As we explore these new trading opportunities dilution of our own high standards is not an option. Our standards of animal health, welfare, traceability and sustainability drive overseas demand for our products and are vital to public confidence in delicious British food,” says Mr Gove.

“Opening up markets to international producers means consumers can enjoy more choice and better prices, but it will not be at the sacrifice of provenance, sustainability and health,” he stresses.

As well as farming, Defra also covers fishing, an industry that is particularly angry because it feels it was sold down the river regarding the transition deal agreed with the EU.

Is it realistic to expect Mr Gove and his successors at Defra to be able to ensure future government policy, whether it concerns free-trade deals or public spending, doesn’t sacrifice the agricultural sector in favour of higher-profile issues such as the NHS or the health of the financial services sector?

“I entirely understand the fishing industry’s disappointment and we were all disappointed that the EU was not willing to meet our proposal to sit alongside other coastal states as a third country during the implementation period,” says the minister.

However, it is important to keep a sense of perspective, he urges. “We must remember that there is a significant prize at the end of this period, and it is critical that we keep our eyes focused on the day that we will finally take back control of our waters.”

Regarding the rest of my question, it is perhaps unfair to expect one minster to speak on behalf of his successors, but Mr Gove strives to reiterate how committed he at least is to the food and farming sector.

“Agriculture employs nearly 500,000 people and is the foundation of our food and drink industry, which contributes £112bn to the economy. In recognition of this, a new Food and Drink Council has been formed to build on proposals for a new food and drink sector deal.

“There is no doubt the development of a new food strategy and environmental concerns are key priorities across government, not least because of their close relationship to social justice, trade, public health and education.”

Red Tape

For many farmers it was their day-to-day entanglement with EU bureaucracy that caused their resentment against Brussels to fester. I put it to Mr Gove that escaping the red tape of the CAP was a reason many farmers backed Brexit. How much of it in reality will they escape?

He won’t go as far as to list any regulations in particular, but talks about the wider opportunities and his aspiration to make farmers’ lives a bit easier by making things happen more efficiently.

“Outside the EU, with control over a new agriculture policy, the government will be able to listen to farmers and land managers and take action where it is needed, including reducing unnecessary bureaucracy.

“To be clear, we can now, for the first time on over 50 years, determine the right policy for England – which means high standards and practical enforcement. We have already reformed the Countryside Stewardship application process to make it more streamlined and easier to apply for with the new wildlife offers, but there is much more to do.

“Our aim is to make sure that farmers can fill out an application within a single day and be back at their businesses by the next. The current processes under CAP put excessive burdens on farmers and can be far too rigid in their application.

“Ultimately, we will have the opportunity to design systems that prioritise results over methods, thereby giving more flexibility to farmers in how they achieve targets and manage their businesses.”

Finally, I put it to Mr Gove that while the CAP is inefficient and involves a large amount of unpopular bureaucracy, it does at least provide farmers with long periods of stability, enabling them to plan for the future and ride out the shocks of an increasingly volatile commodities market.

Above: Michael Gove spells out his plans at the NFU conference

How should they and their representatives prepare for a future that will be determined more by a domestic political agenda than a long-term European philosophy?

“The top 10% of British farmers are the best in the world. And for centuries we have been known for our excellent farming practices, high standards and quick grasp of innovative technologies. Repatriating agricultural policy means that we can build on these successes in a new domestic agenda that priorities productivity and sustainability.

“And even more importantly, the next generation of farmers will be able to influence government policy in ways that their parents couldn’t. This is a hugely exciting opportunity for farmers in Britain,” says Mr Gove.

As with a number of his answers to my questions, it’s heavy on the optimism and rhetoric, but it’s hard to argue with the minister’s passion.

He certainly sounds as if he has convinced himself that his plans offer a bright future for the farming industry. Given that in a speech to the CLA in 2001, when he was still a journalist, Mr Gove professed not to be a countryman, “I have to stress that I don’t come from the soil”, he has come on a long and probably unexpected journey.

The big question of course is whether he will be there to help deliver his vision or whether another cabinet crisis will inevitably cut short his tenure at Defra and send him back to the heart of government.

Read more from Mr Gove, including his thoughts on agricultural funding in the devolved nations and farm inspections in 2018's The Rural Report - a unique guide to the issues that matter to landowners.