We must scrap the Common Agricultural Policy during Brexit – for the sake of our finances

Today, farmers represent three per cent of Europe’s population while the CAP amounts to 40 per cent of the EU budget. As well the £4bn of UK tax money paid towards the CAP, the perversely regressive effects of the subsidy mean consumers endure the inflated price of agricultural goods due to the distorted market

Post-Brexit, many are calling for the abolition of funding for the Common Agricultural Policy (CAP) (OLGA MALTSEVA/AFP/Getty Images)

Few years bear more of a political legacy on Great Britain than 1846. A majority Conservative government was fractured and toppled over the country’s trading relationship with its neighbours. The country’s political parties, at the time the Whigs, Radicals and Tories, proceeded to realign themselves to support or oppose Prime Minister Peel’s abolition of the archaic, protectionist Corn Laws. The Liberal Party was created to defend the free trading status quo, which eventually rebalanced Britain’s economy to make it the foremost world economic power for half almost half a century.

Today, Britain’s regrettable departure from the European Union may be seen as a coup for illiberal, outmoded politics, but it doesn’t have to be. On the 29th of August, Theresa May asked her cabinet ministers to set out how Brexit could be made a success. So I tell her this: a renaissance of our liberal, internationalist, and free-trading principles can start with the abolition of parallel funding for the protectionist Common Agricultural Policy (CAP).

The CAP, described by former UK deputy Prime Minister Nick Clegg as a “wasteful and economically perverse support system for Europe’s farmers”, was introduced in 1962 by the European Economic Community (EEC). At a time when European farming was weak and the food supply was seen as an essential security issue, the CAP was still only approved due to a compromise between leading members Germany and France. The political clout of the agricultural classes has maintained and strengthened the smorgasbord of support given to EU farmers, with such attempts at reform as the Mansholt Plan in 1968 being bluntly rejected by the farming community.

Today, farmers represent three per cent of Europe’s population, or 1.6 per cent of its GDP, while the CAP amounts to 40 per cent of the EU budget, or £49bn per year of taxpayers’ money. As well the £4bn of UK tax money paid towards the CAP, the perversely regressive effects of the subsidy mean consumers endure the inflated price of agricultural goods due to the distorted market.

And romantic images of family-run, independent farms supported by these payments are misplaced; the biggest beneficiaries are mammoth multinational corporations like Nestlé and Campino. The traditional landed aristocracy do rather well too. The British monarchy receives about half a million euros a year in CAP payments.

Outside Europe, the effects of the CAP are even starker. The aberrant economic incentives for farmers to produce more only increase world inequality. Tonnes of subsidised produce from the first world are dumped in Africa and Asia, impoverishing relatively uncompetitive local farmers and worsening third world trade deficits. 2015 saw a wretched record set in India for highest level of farmer suicides in its independent history. In many areas, it has become profitably only to produce raw goods like cocoa or wheat, rather than the finished products. A quasi-colonial relationship has re-asserted itself, where poor African and Asian states dutifully export raw materials to be refined and manufactured in Europe. The audacity of Europeans to then complain about high levels of immigration from The Third World is almost farcically ironic.

Europe’s insistence on upholding its antiquated system of tariffs and subsidies only serves to espouse the image of Fortress Europe, zealously guarding its wealth from the rest of the world. This mind-set is partially responsible for the derailment of the World Trade Organisation Doha round of talks.

The United Kingdom’s exit from the European Union is rightly lamented as an enormous threat to progressive, egalitarian forces in the country. We must act to replicate the best aspects of our membership, from the generous funding of our world leading scientific research, to the support of communities in Wales, Cornwall and the north of England long forgotten by Westminster. However, if we are to forge our way in the world on our own as an economically efficient, cutting-edge industrial power, we must have an agricultural policy that looks beyond short-term surplus and emphasises innovation and environmentalism. For the sake of our finances, our moral duty and our basic British sense of fairness: it’s time to scrap the CAP.