Johnson on subsidies
Q1317 George Kerevan: At your now famous Dartford vote leave launch you said that the common agricultural policy was “demented” and it adds “about £400 to the cost of food for every household in this country”. Are we to take from that that if Britain votes to leave the EU, the average household will be £400 better off in some direct way?
Boris Johnson: There would be some reductions in the cost of food, made possible by getting rid of some bureaucracy and provisions in the current CAP [common agricultural policy] system.
George Kerevan: You have put a number on it. The number was strategically used, so I am just trying to get the number clear.
Boris Johnson: Let me give you a full answer, Mr Kerevan. It is very important for my side of the argument to stress that we believe in subsidising and supporting agriculture. It would not be reasonable to expect British agriculture to survive without direct support. What we are advocating is a repatriation.
Q1318 George Kerevan: I appreciate that. I am trying to clarify the number. You used a specific number, which got a lot of publicity. It may be right or wrong; I am just trying to clarify it. Are you saying that it is not £400 if we leave? What is the saving?
Boris Johnson: The extra cost of food as a result of the CAP has, for a long time, been put at £400 per year, per family.
Q1319 George Kerevan: By whom?
Boris Johnson: I would be very happy to write to you with the provenance of that statistic, but that is certainly a statistic that I have read for a long time.
Q1320 Chair: Would it not have been a good idea to try to find out what that statistic was before making it in a speech like that?
Boris Johnson: Mr Kerevan, I would be very happy to supply you and Mr Tyrie with the origins of it. If you think about it for a second, you can see that if you support agriculture in all sorts of ways – through subsidies and tariffs – there will be an extra cost. The question for us is: is the CAP efficient?
Q1321 George Kerevan: £400 is misleading, because it is not what people would save.
Boris Johnson: Is CAP efficient in the way--
Q1322 George Kerevan: No, you have gone off on a tangent. I am trying to be as specific as possible. We have a number. You introduced the number. You do not know where it came from. Is it a £400 saving – or is it £300 or £200 – or do you know?
Boris Johnson: Let’s be very clear: there is a cost to the consumer.
Q1323 George Kerevan: You used a specific number two weeks ago. You do not know where it came from. You are now telling me that it would not be £400. It would be less than that.
Boris Johnson: You have spoken about a saving. I was speaking about a cost.
Q1324 George Kerevan: You said that there was a £400 cost at the moment. You used the number. If we leave – I am asking – do we save that £400, wherever it came from?
Boris Johnson: My answer is that we would not save all that £400. We would save some.
Q1325 George Kerevan: How much?
Boris Johnson: I cannot give you that figure. We will certainly continue support for agriculture, and all farmers will continue to receive the current levels of subsidy. We would need to make sure that was baked in very firmly and that stewardship and deficiency payments – payments for agriculture – would be maintained.
Q1326 George Kerevan: As well as UK subsidy to farming and fishing, do you mean you would maintain the £3bn a year that goes to British farmers from the EU?
Boris Johnson: Yes, but do not forget the FEOGA [Fonds Europeen d'Orientation et de Garantie Agricole] budget, or the European Agricultural Guarantee Fund, is something to which we are huge net contributors. We pay in much more than we get back. The net contribution on FEOGA is something like £4bn. I would have to check the figures, but it is a very considerable net payment we make in to the European agricultural system. There will be more funds available for the support of other vital services in this country. More to the point, I think everybody does understand.
Q1327 George Kerevan: I appreciate the editorial comment as a journalist. The £400 that you have used, and which is constantly used, comes from the TaxPayers’ Alliance. It comes from data that is seven or eight years old, so it is quite whiskery. It does not include netting back the money that comes to British farmers, which is about £3bn a year. Even on its own grounds, that £400 is misleading because it does not include the money that comes back to British farmers and British businesses.
Boris Johnson: As I have tried laboriously to point out: at the moment, if you look at the Office for National Statistics’ figures, we contribute gross about £20bn. Through the agricultural, structural and regional funds, or abatement, we get back about £10bn. There is scope for a colossal saving for British taxpayers.
George Kerevan: I understand that.
Boris Johnson: I am glad you understand that, because that is a vital point.
Q1328 George Kerevan: It is a vital point. The vital point – now that you have explained that you understand that farmers get money back from the CAP – is that the £400 that you are using, which does not include allowance for that net back, is an exaggerated figure.
Boris Johnson: No, it is the extra cost as a result of the CAP. In my view, it partly reflects the additional bureaucracy of the CAP system, with its price support, intervention, export refunds – all sorts of mechanisms that are exceedingly inefficient. It would be possible to have strong domestic support for farmers and repatriate the CAP in such a way as to support British farmers in a way that they need and deserve.
Q1329 George Kerevan: How would you change the support system?
Boris Johnson: The EU is party to witting evil in the way that it discriminates against manufacture and agricultural products from sub‑Saharan Africa, for instance. There are goods that would benefit families in this country that come from markets that are currently prevented from exporting to us by the external EU tariff. People should care about that very much. The whole system of price intervention – although they have moved away from that a great deal – is still crazy.
Q1330 George Kerevan: I am asking what your system would be.
Boris Johnson: This would be a matter for government and parliament to decide, but my preference would be for deficiency payments and farmgate payments that were baked in and supported agriculture in the way it needs to be supported, and stewardship payments as well, because many farmers need support for looking after the land and not just for producing. Thank you, Mr Kerevan, for this question, because it is vital to get across that it would be at the level that they currently enjoy and that level of support would be perpetuated.