Ministers are planning to overhaul how to calculate farming’s economic contribution, a move that would place agriculture on equal footing with the car manufacturing industry, in an attempt to regain farmers’ support.
Environment Secretary Emma Reynolds is collaborating with the Office for National Statistics to broaden the measurement beyond farmers’ fields, incorporating the entire agri-food chain from dairy processing to brewing.
Under current calculations, agriculture accounts for merely 0.6 per cent of gross value added, equivalent to £14.5billion.
However, by including food manufacturing and catering operations that transform raw agricultural materials, the sector’s contribution would rise dramatically to 6.2 per cent of GVA.
This expanded definition encompasses 4.1 million workers, representing approximately one in ten employed people across the country.
Ms Reynolds told The Times the current 0.6 per cent figure “massively underplays and underestimates the value of farming,” describing it as “completely inaccurate” and suggesting it has led to the sector being undervalued.
“Of course, farming doesn’t stop at the farm gate. We should look at agri-food in the whole. And the agri-food sector is massive.
“It’s got the economic value that’s equivalent to the automotive sector or the construction sector,” she said.
Environment Secretary Emma Reynolds has announced the overhaul to the way farming’s economic contribution is calculated
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The Environment Secretary said this accounting revision, developed in partnership with the ONS, forms part of an “ongoing reset” aimed at restoring farmers’ confidence in Government.
The initiative follows significant discontent within the farming community last year over proposed inheritance tax changes and sudden closures of subsidy programmes.
“I have been absolutely determined to rebuild that relationship with farmers,” Ms Reynolds said.
The Environment Secretary made these remarks ahead of unveiling a 25-year farming roadmap for England, which she said would abandon the “short-term policy approach” and demonstrate that “we are a government that cares about food production”.
The move would see British farming moved more in line with the automotive industry
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Ms Reynolds also responded to an independent review conducted by Baroness Batters, the former National Farmers Union president, accepting 53 of its 57 recommendations.
The Batters review put forward proposals including simplifying the construction of farm reservoirs, enhancing access to finance, and addressing labour shortages affecting the harvesting of salads and soft fruits.
Full details of the government’s response will be published on Wednesday alongside the farming roadmap.
Ms Reynolds emphasised that subsidies would remain conditional on farmers implementing measures such as improving soil health, rejecting suggestions that food production would take priority over environmental considerations.
Baroness Batters welcomed the Environment Secretary’s commitment to working with the ONS on measuring the true economic value of food and farming.
“I’m delighted that Emma Reynolds sees the enormous benefit and urgency in working with the ONS measuring the true economic value of food and farming,” she told The Times.
However, she expressed disappointment that the food and farming partnership board was not focused on delivering this objective.
The former NFU president said this was the priority farmers and growers had communicated most strongly during her review: expanding market share from local to international markets and retaining more money, jobs and investment within the UK economy.