Brexit, food and trade: what is in the public interest?

Published on 18 December 2017

Elise Wach

Research Advisor

IDS very recently took the opportunity to submit evidence from the project ‘Transitions to Agroecological Food Systems’ to a parliamentary inquiry about post-Brexit food and trade policy. A number of organisations, businesses and individuals also submitted their priorities to the committee.

On reviewing the submissions it’s interesting to note the contradictory standpoints across the range of evidence.

For example, the National Farmers Union Sugar association and British Sugar PLC (the single processor of beet sugar in the UK), argued in favour of safeguarding the British beet sugar industry against non-EU imports (i.e. protectionism) while also ensuring secure access to sugar beet seeds from the EU. Tate & Lyle Sugars, on the other hand, which uses sugarcane from equatorial countries in its British refineries, argued for market liberalisation to ensure the competitiveness of non-EU sugar supplies.

The committee certainly has a job to do to navigate their way through these competing demands to a clear set of recommendations. And as part of this process they must also take account of the health and wellbeing concerns of the people living in the areas affected by such policies. In the context of soaring rates of diabetes and obesity, ensuring access to cheap and plentiful sugar would not be high on the list of priorities for ensuring the wellbeing of people in Britain.

This throws up another thorny question for the committee – how to reconcile the interests of consumers with those of businesses and producers.

Producers vs Consumers?

There are countless examples of where consumer and producer interests clash in our current food systems. In another submission to the select committee, the National Farmers Union (NFU) indicated that the EU has been ‘overly precautious’ with pesticide regulation, and that this is ‘damaging agricultural and horticultural competitiveness and production.’ However, do consumers want more pesticides to be permitted beyond the thousands that already are, or an increase in the ‘maximum pesticide residue’ permitted on their foods?

Epidemiologists and public health experts at a recent Royal Society of Medicine conference expressed concern over the health effects – such as non-alcoholic fatty liver disease – of low doses of widely used hormone-disrupting pesticides. Consumers may have to adjust to somewhat more blemished-looking products and somewhat shorter shelf lives, but compared to fatty liver disease or cancer, it does not seem to be much of a trade-off.

These clashes between consumer and producer interest do not only come up in situations like the sugar and pesticide examples, but also among farmers who are driven primarily by ethical motivations in their production, such as agroecological farmers. As it stands, these farmers are often driven to produce for high-end niche markets in order to make ends meet. Such markets tend to exclude the majority of the population who have no physical or monetary access to, for example, local and ecologically produced foods.

Can we change the current context?

Of course some aspects of our current context, such as global World Trade Organization regulations, cannot be changed so easily. But other aspects of our food markets can be. Currently, farm-gate prices account for only 15 per cent of the retail value of food, making it difficult for farmers to earn a living wage based on farm sales. This small percentage of food retail prices – in combination with low prices to begin with – is what drives farmers to  either produce at high volumes (i.e. through using significant amounts of agrichemicals at the cost of our natural resource base) or produce high end products (i.e. niche and expensive products). Or they get out of the business, and land gets consolidated into even larger farms. None of those strategies work out to be in the public interest. But it certainly does not need to be that way.

Community Interest Company (CiC) Tamar Grow Local (TGL), for example, is demonstrating a number of alternatives to the status quo food economy. As a CiC, its decision making is explicitly driven by the interests of both producers and consumers. Prices that farmers receive relate not to the highly volatile global commodity prices as in ‘conventional’ markets, but instead relate to the cost of production and the cost of living.

In the case of apples, this means that when prices were extremely low in 2006, TGL producers received 275 per cent higher than the market wholesale price. But this year, given that global prices were high, TGL producers received the same as the average wholesale price. The cost to consumers, however, is maintained in the middle of average market prices. The way that TGL is able to achieve this is through its much lower mark-up – TGL adds only 18 per cent to the farm-gate cost for trade, transport, processing and retail, compared to the industry average of 85 per cent.

Another area in which TGL is departing from the norm is in its Grow Share Cook project. This project supports local producers by procuring vegetables at the rates mentioned above and providing them to people living in food poverty who would normally depend on food banks. The project has reached 200 low income households, achieving a healthier diet for 85 per cent of them, while supporting 60 producers to earn a dignified living from farming.

Other models such as the Real Food Bus and Community Support Agriculture schemes are also designed to make local, ecologically produced and healthy foods available and accessible to consumers across the board, no matter where they live or how much income they have.

What’s economically sustainable?

Such approaches cannot exist without funding. And this is where most people conclude, ‘well it isn’t sustainable then.’

However, in comparison to the status quo, such models are hundreds if not thousands of times more economically efficient.

The True Cost Accounting initiative of the Sustainable Food Trust has been drawing attention to the ‘externalised’ costs of our current food system, such as farm-related flooding, food-related health costs and the cost of filtering out pesticides from our water supply. These add up an average of £2,000 per person per year in the UK, not including the infamous subsidies to farmers themselves. This money comes from taxpayers every single year. So we are far from an economically self-sustaining food system. However, models that incorporate multiple dimensions of the public interest get us closer, not further, to economic sustainability.

Putting public interest at the heart of our food system

When we move away from ideologies about free markets versus protectionism and we go back to the question of, ‘what is in the public interest?’ then consumer and producer interests becomes less antagonistic. Instead we can find other avenues for ensuring that both farmers and consumers are supported to live healthy and dignified lives, while also safeguarding vital resource, such as soil, water and biological diversity. What Tamar Grow Local and the Real Food Bus show us, though, is that this may require a different approach to markets altogether.

The views expressed in this opinion piece are those of the author/s and do not necessarily reflect the views or policies of IDS.


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