Reflections on Bright Blue's Green conservatism conference

On Wednesday 1st November, Bright Blue hosted its inaugural Green conservatism conference – a day-long event of panel discussions and keynote speeches, all feeding in to some of the most pressing debates currently taking place in the environmental sphere. Specifically, we endeavoured to examine four distinct areas of interest: agriculture, conservation, the role of markets in energy, and energy security.

The day began with a keynote speech from the Minister of State for Climate Change and Industry, Claire Perry MP. She struck an optimistic tone about the economic and industrial opportunities the UK has going forward as a cleaner and more environmentally sustainable nation – citing the Government’s work in pioneering the Contracts for Difference reverse auctions which have led to a blossoming, and ever cheaper low-carbon power sector, and unprecedented investment in renewables like solar and wind since 2010. Perhaps most interestingly of all, the Minister acknowledged that current policy does not allow onshore wind projects to bid for low-carbon contracts, and that this inconsistency is something the Government is actively seeking to address.

Agriculture and CAP reform

The first panel of the day sought to explore the current and future status of agriculture in Britain, particularly in the context of Brexit. A vigorous debate ensued, with the panel divided as to what the future status of rural payments to landowners and farmers ought to be in the coming years.

Arguments were advanced both for and against maintaining large-scale state support for the agricultural sector. Those backing a continuation of payments made their case for doing so largely on the basis of food security and food standards, as well as to remunerate farmers for the various aspects of environmental stewardship they provide.

On the other side of the argument, however, the contradictory nature of CAP payments vis-à-vis environmental sustainability was advanced, along with the economic inefficiency which some believe they have encouraged in Britain’s agricultural sector. Regarding the stewardship role of farmers, it was argued that this could still be retained, albeit through a more targeted system of commissioning public ecosystem services where they are demanded.

The future of conservation

There was consensus on our second panel about the need to be doing a good deal more conserving. Each panellist, however, contributed a unique perspective on just what, exactly, the focus of conservation ought to be. Suggestions ranged from raw materials to soil quality, and ancient woodland to native species of flora and fauna.

One point of contention among the speakers was over the use of targets within conservation policy. Arguing against targets, some vocalised how they can give conservation efforts ever narrower focuses, whereas it can be more effective to examine issues of this kind holistically. The risk that a plurality of targets can quickly become contradictory of each other was also raised.

Nonetheless, other panellists defended this approach, largely on the basis that targets can serve as a spur to much needed action – for example, as we have seen with the phase out of petrol and diesel cars, or recycling rates. Furthermore, it was argued that targets may also usher in better data collection which can be crucial to understanding what elements of conservation policy are going right, or, importantly, wrong.

The panel also touched upon question of rewilding. Again, all broadly agreed that a degree of rewilding could be agreeable, yet there was debate around how far it should go. Some favoured the reintroduction of species like the lynx and beaver, but others drew the line at restoring native habitats, such as rewetting peatlands and reforesting upland woodlands which have been lost to agriculture, for instance.

Strengthening the role of markets in energy

Among the third panel of the day (and the first on energy), there was a general recognition that markets can and should be strengthened to deliver better outcomes for consumers. Different panellists highlighted the role that different technologies could play in revolutionising how we consume energy, such as big data, blockchain, connectivity, interconnection, and also demand flexibility services. As these cost-effective technologies develop and expand in the market, there will be greater scope for reducing government intervention.

Whilst there was broad praise for the Contracts for Difference reverse auctions which the Government has been conducting to drive down the costs of low-carbon power subsidies, the panel was split on the efficacy of large-scale nuclear projects like Hinkley Point C backed by now seemingly exorbitant strike prices. Some saw them as a necessary price to pay to ensure a secure supply of low-carbon energy, others as overly expensive and incompatible with a more decentralised, flexible electricity grid.

Energy security in the UK and Europe

Much in the same way as some members of the first panel on agriculture questioned the need for food security, so too was there scepticism on our fourth panel about the idea that the UK should be worried about energy security. Indeed, the panellists drew an important, under-appreciated distinction between self-sufficiency, which means that all energy is produced and generated domestically, and security, which means that energy supplies are secure through having diverse and reliable sources.

The panel was quite clear that we should not overstate the importance of Russian energy imports in the context of UK and European energy security, citing the maxim that “Russia needs Europe more than Europe needs Russia”. There was also significant optimism that improvements in renewables like wind energy will make domestic production easier, while new technologies such as electric vehicles and advancements in batteries will also help to bolster our storage capacity.

If there was one outstanding note of caution raised by the panel, it was that as our energy networks become increasingly interconnected and convergent, the potential danger of a successful cyber-attack on the system escalates. This, more so than conventional energy security fears, seemed to be where the panel thought resilience in our energy sector would be most needed.

Conclusion

The final two speeches were delivered by two former Environment Secretaries from the Major Government. While divided on the question of the UK’s membership of the EU, they are united on the imperative of protecting our environment.

First, the Rt Hon Lord Deben, Chair of the Committee on Climate Change, spoke of how business needs to assume a greater responsibility for tackling climate change, especially now that the science so clearly supports anthropogenic climate change. He stressed the idea of doing more to internalise hitherto externalised costs of pollution associated with consumption – in basic accordance with the ‘polluter pays’ principle. Furthermore, he highlighted how much more energy efficient everyday living has become as a result of EU regulations.

Second was the former Leader of the Conservative Party, the Rt Hon Lord Howard. Speaking with reference to his role as Secretary of State for the Environment during the Rio Summit of 1992, Lord Howard raised how, contrary to popular assumption, rising living standards and decarbonisation need not be antithetical – citing evidence that the UK has witnessed both the greatest decline in carbon emissions and greatest rise in per capita economic growth of all G7 countries over the past 25 years. He argued that Brexit would allow the UK to become even more environmentally friendly than it currently is.

In summary, the Green conservatism conference successfully brought together a range of policymakers, experts, and practitioners, particularly on the centre-right, with the shared ambition to realise a greener, more sustainable world, yet with different perspectives on how to achieve that desire. The debates which took place were testimony to the long-standing, but underacknowledged conservative commitment to environmental stewardship and conservation.    

Eamonn Ives is a Researcher at Bright Blue

Gove’s green guarantee: reforming the Common Agricultural Policy

On the Andrew Marr Show last weekend, the new Environment Secretary, the Rt Hon Michael Gove MP, offered some succinct and unambiguous answers on the outline of agricultural subsidies post-Brexit. Of particular note, he confirmed that wealthy landowners could expect to receive less money in the form of subsidies after the current Parliament.

The Common Agricultural Policy and its problems

At present, the regulatory and funding systems which govern the British countryside are dominated by the EU’s Common Agricultural Policy (CAP). This regime sees the UK receive over £3 billion per annum, which is allocated to farmers and landowners alike. Underpinning the CAP are two ‘pillars’, which dictate as to where public money is directed. Pillar I funding consists of measures such as income support (money awarded per hectare of land owned), and receives three quarters of the total CAP budget. Pillar II funding, which is paid out through each EU member state’s Rural Development Programme, is supposed to encourage environmentally sustainable farming practices in return for cash payments.

Unfortunately, this system has a number of perverse unintentional environmental implications. Firstly, the strict requirements for Pillar I payments mean that farmers have a fiscal incentive to avoid agri-environment practices. One instance of this playing out in reality is reports of some farmers felling trees under the justification that it will increase the amount of land on which they can farm, and thus claim subsidies for.

Secondly, by subsidising inefficient farming operations, the CAP has allowed agriculture to take place in areas it otherwise would not. Hill farming, for instance, is rarely economic, as the market price received for produce cultivated on hillsides would not cover the costs of production – it is only thanks to subsidies that the practice persists. Without subsidies, therefore, this land would go unfarmed, potentially allowing more afforestation in the uplands, and increased biodiversity as a result.

The future of agricultural subsidies after Brexit

With woodland coverage in the UK having shrunk to just 13% of the total land area, society is missing out on a wide range of benefits that trees offer. A report from the Forestry Commission cites how trees purify the air, serve as natural flood defences, and are even associated with improving mental health amongst individuals. It is for exactly these reasons that Bright Blue launched its campaign earlier this year for the Government to improve tree planting incentives for farmers after Brexit.

But what other funding priorities should the new post-Brexit agricultural policy have? The National Trust has called for taxpayer money to be paid out to farmers only where clear public benefits are delivered. They have also pointed out the fact that there are certain aspects to agriculture which degrade the natural environment, such as through the excessive use of harmful fertilisers, and which currently are actively rewarded by the CAP. Thus, a more targeted system of granting funds to farmers would allow the Government to remove or reduce payments from those who engage in such detrimental practices.

Echoing this perspective is Professor Dieter Helm of the University of Oxford, who argues that the problem is not that farmers receive public money per se, but rather the ends to which it supports. Further, he argues that farmers should be regulated to maintain the land to a certain level in a way that avoids harming the wider environment and that public funds should be earmarked to directly purchase public goods from farmers.

The consequences of Brexit on the agricultural community will be pronounced, perhaps more so than for any other sector of the economy. Many farmers are anxious that the end to subsidy payments could imperil their businesses and livelihoods. Yet such fears may be premature and unwarranted. In 1973, New Zealand’s farmers faced a comparable situation when Britain – one of its then major trading partners for foodstuffs like lamb and dairy – joined the European Economic Community and thereby adopted its external tariffs.

New Zealand responded by removing all of its agricultural subsidies in 1984 for food production and fertiliser use. These subsidies had been blamed for environmental degradation, low productivity, and inducing a lack of innovation within the sector. Once withdrawn, some smaller farmers who lacked the requisite economies of scale went out of business. But many others successfully embraced innovations in science and technology as the means to realise increasing yields, and began to utilise the differing types of land more effectively and more efficiently. Accordingly, New Zealand’s agricultural sector enjoyed average real terms growth of 4% for the next 15 years and has since established itself as a key component of the global food supply network.

In terms of the environment, the results have been mixed. With the lucrative subsidies scrapped, farmers found it less affordable to purchase artificial fertilisers and pesticides, and their use declined accordingly. Moreover, rates of afforestation increased, and the total number of hectares of land dedicated to pasture fell. However, critics of New Zealand’s approach have cited concerns about how the rate of conversion of indigenous grassland to exotic pasture increased in the South Island by 67% between the period 1990-2001 and 2001-2008. In addition, by excessively focusing on its comparative advantage in livestock production – a highly greenhouse gas-intensive activity – New Zealand has become the largest emitter of livestock emissions per capita.

Conclusion

In leaving the EU, and by extension the constraints of the CAP, Britain has presented itself with an historic opportunity to review the relationship between the Government and the agricultural sector. The substantial sums of money which are currently sent to subsidise inefficient, and at times environmentally injurious, farming operations can be redirected to finance projects and farming practices that improve the environment.

During the debates which took place in the run up to the 23rd June 2016, there were only cursory mentions of the implications of Brexit for the environment, with the Remain side highlighting the potential loss of environmental regulation, and the Leave side promoting the opportunity to relinquish the EU’s unwieldly CAP. We now have a Government re-committed to “being the first generation to leave the environment in a better condition” than it inherited. Certainly, Gove’s comments this weekend indicate his desire to use Brexit and the UK’s departure from the CAP to further that ambition.

Eamonn Ives is a researcher at Bright Blue

Future farming policy: putting all our asks in one Brexit?

Politics is finally emerging from the shock and awe of the Brexit decision and frameworks for policy development for a new post-EU future are beginning to emerge. An abiding question is whether the political and economic realities of our impending separation will mean damage limitation is required or whether Brexit presents opportunities, not least for innovation and dynamism in business and in policy.

The risks of damage are perhaps nowhere clearer than for farming. The Common Agricultural Policy (CAP) has taken the lion’s share of the EU budget for decades. Though it has fallen recently, it’s doubtful HM Treasury will want to continue funding farming in the way the CAP has done. George Freeman MP, chair of the PM’s policy board, has recently suggested as much.

Not least the Brexit debate set many hares running about where our ‘repatriated’ EU contributions could or should go and farming wasn’t at the top of the list. If we add in the risk that the trade deals finally settled upon are likely to meet the needs of the most influential industries – perhaps financial services or engineering – then farming could face both cuts to a stable source of funding and more intense competition from often cheaper imports.   

These challenges are faced by an industry that is already in a precarious economic position. Despite turnover of nearly £24 billion in 2015, little short of half of the ‘income’ from farming came from public funding, not farmers producing food. In 2014-2015, farms in the cereals and grazing livestock sectors upland and lowland were on CAP life-support: they made losses. Overall, the farming industry is struggling from a combination of interrelated economic pressures despite public funding: long-term falls in farm gate prices, volatility on world markets, a de facto cheap food policy in the UK and supermarkets driving food prices down as they compete for customer loyalty and market share.  

Brexit hasn’t changed all these factors but it offers the chance, unparalleled in 40 years, to reshape farming policy to better address them and other pressing needs. Within the new frameworks of its 25 year plans for farming and the environment, the Government has a signal opportunity to be progressive. It’s also a moment for all those who care about the countryside and the future of farming to support an ambitious agenda.   

A first goal must be to agree on how to create a resilient, financially stable and dynamic farming industry for the long term. Without it food production will be less secure and the rural economy weakened.

A second and equal goal must be to agree on how farming can be made to work for the wider community and the environment. We should take it as understood that a farmer’s vocation is to produce food. Although food production depends on environmental assets, we can’t rely on farmers’ benevolence and voluntary action on the environment when they face tough markets and a fight to survive in the short term. But equally, if substantial amounts of public money are to keep going into farming, we can’t rely either on public benevolence to fund farmers for business as usual.

This means farming fit for the future has to engage with a wider set of issues as a norm: it must address unsustainable use of natural resources and the damage caused to wildlife, water quality, soils and landscapes. So a central goal for future policy post-Brexit – which the Government’s new plans for farming and the environment must help achieve - should be to recognise its multipurpose role: we need to farm for food and beyond food too.

In a country with a relatively small land area and growing population we don’t have the space or freedom for farming to do otherwise: farming must continue to feed us and provide cherished landscapes, clean water and effective flood management, healthy soils that soak up carbon, thriving ecosystems that support abundant wildlife, all of which benefit the public in myriad ways. These are benefits that the market poorly rewards, if at all.

These are benefits that, if farming is oriented towards them by policy with proper levels of funding, should bring greater efficiencies – for example, by ensuring fewer nitrates enter water bodies, that pesticides are targeted precisely - and cost savings to farmers. They will avoid costs to the public too: for the clean-up of water polluted by run-off, for the dredging of eroded soils, insurance bills for flood repair and the unpredictable fall out costs of global warming.

The case to fund multipurpose farming should and can be based on strong principles: demonstrable public benefits for public funding, accountability to those who pay, a holistic approach to link farming with nature across the landscape and fewer costs, more efficiency and better value for money.  Framed this way there is a strong case to be made to Government to win the first battle in the post-Brexit debate: to maintain public funding into farming at the high levels we will need to create the resilient farming sector that can do what we need for food, for communities and for the natural environment.

Graeme Willis is senior rural policy campaigner at the Campaign to Protect to Rural England. You can read more about these ideas in their new report, New Model Farming: resilience through diversity

The views expressed in this article are those of the author, not necessarily those of Bright Blue.