Before the EU referendum, the Remain campaign warned British farmers that they would lose out if we left the EU. “The EU will invest almost £22 billion in CAP funding in the UK between 2014 and 2020,” said the campaign. “Vital” funding would be lost. “Only the top 10% of UK farmers could cope if the UK left the EU…” “‘Leave’ campaigners cannot guarantee that funding for UK farming would continue…” Lots of ‘leading’ figures from the industry even wrote an alarmist letter to The Times.
It wasn’t just farmers who were told they should be worried.
Britain Stronger In offered the following statement as part of their “Get the Facts” message:
“We would lose vital EU funding for the farming, scientific and medical research and programmes that make a real difference in your local community, including job-creation schemes for young people to infrastructure projects that improve your everyday life, including broadband networks, better roads and new bridges. In a recession, our government would not be able to replace these grants even if they wanted to.”
Until a couple of months ago the Government spin machine was keenly promoting these messages as part of Project Fear. This morning there has been a pretty effective briefing to the media from the Government spin machine rebutting such nonsense. The message has come through loud and clear that the funds will be maintained. Project Reassurance is well under way.
The BBC reports:
“EU funding for farmers, scientists and other projects will be replaced by the Treasury after Brexit, Chancellor Philip Hammond has said.
In a move which could cost up to £4.5bn a year, the Treasury will guarantee to back EU-funded projects signed before this year’s Autumn Statement.
Agricultural funding now provided by the EU will also continue until 2020.”
In the full announcement Sajid Javid, the Local Government Secretary, says Local Enterprise Partnerships will get the funding they were due from the EU. Greg Clark, the Business and Energy Secretary, assures us that the UK Government will be “underwriting the significant Horizon 2020 grants”. Damian Green, the Work and Pensions Secretary, reports that such projects as the Ways to Work programme in Liverpool will not lose out.
David Davis, the Secretary of State for Exiting the European Union, said:
“This announcement shows that the government is ensuring that those people and organisations currently supported by EU funding can continue to benefit from a measure of continuity. This will offer reassurance to them, and help ease the transition to our new relationship with the EU.”
This undertaking reflects what the Vote Leave campaign said before the referendum:
“If the public votes to leave on 23 June, we will continue to fund EU programmes in the UK until 2020, or up to the date when the EU is due to conclude individual programmes if that is earlier than 2020.
‘We will also be able to spend the money much more effectively. For example, some of the bureaucracy around payments to farmers is very damaging and can be scrapped once we take back control.
“After protecting those now in receipt of EU funding, we will still have billions more to spend on our priorities. We propose that at least £5.5 billion of that be spent on the NHS by 2020, giving it a much-needed £100 million per week cash transfusion, and to use £1.7 billion to abolish VAT on household energy bills.”
The maths was never all that challenging. Our net contribution to the EU budget is £10.6 billion a year. So should we choose to maintain all the spending programmes undertaken by the EU in the UK that will be eminently affordable.
Of course in the longer run there will be plenty of debates about what the priorities should be. There have been plenty of concerns raised that much of the EU’s spending has been wasteful or inefficient. In certain cases actually damaging. New Zealand farming has continued to prosper after subsidies were scrapped.
But for the period until 2020 it is right and proper for the funding obligations to be honoured. It allows planning to calmly continue.
Along with the abandonment of the “Emergency Budget” and the welcome rise in share prices, today’s news is another encouraging sign that we have nothing to fear from Brexit.