Last week a farmer in the Yorkshire Wolds successfully sued East Riding Council for compensation of £14500 for the loss of a field of carrots. The carrot crop was apparently lost when floodwater was pumped onto the field at Burton Fleming, to prevent houses in the village from being further damaged by the water. This is apparently the first case of a farmer claiming compensation against a Council under the 1991 Land Drainage Act. The Council are waiting to see the Land Tribunal judgement before deciding whether to appeal.
The farm in question, Robert Lindley Limited, is a 670 acre (284ha) farm in the Yorkshire Wolds. In 2013, the most recent years for which figures are available, they received €134,000 of farm subsidies. This relatively small amount for the area indicates that the farm uses some land to produce food which is not eligible for farm support payments – perhaps their large flock of free range chickens. Carrots are eligible for farm subsidies.
Robert Lindley Limited has received farm subsidies totalling €1.175 million euros since the Common Agricultural Policy rules changed in 2003. Before that time, farm subsidies were paid to farmers to support food production. Since 2003, payments have, in theory, been “decoupled” from production – from that date, landowners can receive payments under the CAP without producing any food, as long as their land is in “Good Agricultural and Environmental Condition”. The change was intended to reduce the overproduction of food which had been one of the consequences of the CAP in the previous decades.
The business also appears to be doing pretty well – shareholders funds increased from £1.35M in 2013 to £4M in 2014.
Carrots are an extremely lucrative crop: 700,000 tonnes of carrots are produced every year in the UK from just 9000ha, producing a crop valued (at sale) at £290M. While most of the value is captured by distributors and retailers, even if only 20% of that value went to the farmer, it would be worth £6400 per ha.
It was a strange coincidence that also last week, Neil Parish, Farmers Friend, and chair of the EFRA Parliamentary Select Committee, suggested in conversation with the Prime Minister
“In some areas the rivers need to be dredged in order to get the water out to sea faster. In other areas, perhaps upstream, you actually need to hang on to that water for longer. Therefore, perhaps planting trees or perhaps re-wetting that land —the farming practice — is necessary. At the moment, most of that compensation to farmers is for loss of profit, and it is not actually very much of an incentive for farmers, necessarily, to produce that land and use it for flooding. What I would like to see — I don’t know whether you would agree with me — is a much more proactive policy, where farmers are actually encouraged more to take on that water and manage it, and for that to be part of their farming practice, rather than being forced into it, so that we are using more of a carrot”.
Carrot indeed. Parish was reflecting the NFU position that farmers should not only receive farm payments for not necessarily producing food on their land, but should also receive top up payments for allowing it to flood in times of dire emergency. And, as the Burton Fleming case shows, if they are not dangled this additional carrot, they can sue the local council for compensation, with the support of the NFU and its insurance provider NFU mutual.
For the National Farmers Union, and, inter alia, its membership, have a direct financial interest in farmers receiving compensation from councils where farmland is flooded and crops lost. Farmers receive insurance from their union’s insurance company NFU mutual. So, if they can get compensation from somewhere else (eg Councils) then they can avoid having to spend the farmers money paying insurance claims, with consequent increases in the insurance premiums. No wonder NFU Policy Director Andrew Clark was pleased;
“We are very pleased it was decided that the authority should compensate Mr Lindley. It demonstrates the need for the flood authorities to be aware of the consequences of actively flooding farmland when carrying out flood risk management.
“It’s really vital to consider that many fields are used for food production and are the most important part of a farm business. The NFU is committed to supporting members affected by flooding issues.”
I wrote last week about the balance between private profit and public benefit. Society as a whole has to consider whether rural land should be managed in such a way that water is either retained so as to avoid downstream (urban) flooding, or that water is drained as quickly as possible from that land to maximise food production and farmers profits.
Given that landowners are no longer paid to produce food, for what are we paying them their subsidies, if not to provide public benefits? Public benefits that include, for example, retaining flood water on their land to avoid people’s homes being rendered uninhabitable and their treasured possessions destroyed. Surely this should be a condition of receiving CAP subsidies.
If the Burton Fleming case is upheld, it would indicate that landowners are going to be paid by UK taxpayers, to drain their land and create downstream flooding (via the CAP), and then paid again, by local council tax payers, when their land is used to hold flood water back.
I wonder whether the residents of Burton Fleming, whose houses were flooded in 2012, are aware that the Council Tax they are paying, is being used to pay their local farmer compensation (and therefore keep other farmers’ insurance bills down), instead of paying for essential services like schools, or the fire service. East Riding Council will need to have found £194M of savings from its budgets in the 10 years to 2020.