Tag Archives: farming

How can agri-tech prepare for the next parliamentary term?

MPs might be on their summer break but what can you be doing to prepare for the next parliamentary term?

August in Westminster is a quieter time. Government grinds to a halt as MPs return home to continue business back in their elected constituencies. This downtime in the political calendar grants companies a rare breathing space – and the opportunity to turn attentions to resetting government relations plans and preparing for the parliamentary year ahead.

Before parliament returns on 1 September, businesses should be taking the time to think about how to best prepare for the government’s second year in office. Although parliament is in recess, there’s still plenty we can be getting on with to develop an effective strategy and work towards policy objectives. From strengthening stakeholder engagement strategies to assessing regulatory risk, the planning taken now will make the crucial difference between scrambling to adapt to policy announcements and confidently navigating the next wave of policy decisions.

So, what should businesses be thinking about during these summer months?

Engaging with the civil service

While parliament draws to a close over the summer, the civil service remains central to ensuring the smooth operation of public services. Officials continue to work on the implementation of government policies, running consultations, and preparing for the legislative activity that is set to resume in the autumn.

For businesses, the absence of parliamentary activity offers a valuable opportunity to take stock of their existing relationships with civil servants, assess the strength of those channels of communication and identify where they could be expanded. Civil servants tend to be a bit quieter over summer too, so it’s the perfect time to catch up over a coffee in preparation for the year ahead.

Monitoring Parliamentary Committees

Similarly to the civil service, parliamentary committees continue their business while MPs are away. Staff continue to work behind the scenes, launching calls for evidence and meeting businesses in their sectors of interest. In recent weeks, we’ve seen a flurry of committee activity affecting the agri-tech space.

The Science, Innovation and Technology Committee have launched an inquiry into innovation and global food security, actively seeking to hear from agri-tech businesses about how new agricultural practices can catalyse food production. Each Committee’s reports, which are written using the evidence submitted to the inquiry, land directly on ministers’ desks – offering businesses the space to communicate exactly what they need from government to succeed.

Can we also add the health one here? One of the focuses of the health one is healthy food and many of the agri-tech businesses focus on improving nutritional content e.g. precision breeding.

Preparing for Party Conferences

The annual party conferences mark a significant moment in the political calendar. Taking place over September and October, each conference allows parties to set their political agenda and rally support from members and industry. For Labour as the governing party, this means actively listening to and engaging with businesses of all sizes to better understand their priorities, concerns, and capacity to contribute to the party’s core objective of economic growth. With agri-tech flagged as a frontier industry within the government’s industrial strategy, the party conference will provide a useful avenue for businesses within the sector to raise their profile with government.

For opposition parties, conferences are a critical space for developing and refining alternative policies that can challenge the government’s agenda. Without the responsibility of running departments day-to-day, opposition parties can use this time to strategise ideas that could credibly form the backbone of their next election manifesto.

Meeting with MPs

Although MPs are back in their constituencies during recess, they are not on officially out of office. During this time MPs turn their attentions to local priorities, such as meeting constituents, visiting community projects and engaging with businesses in their area. Businesses, and especially those developing cutting edge agricultural technology, should think about inviting MPs to visit their sites to see first-hand innovation in the sector. Demonstrating tangible contributions to local employment, food security, environmental sustainability, or economic growth can help MPs see how your business aligns with their constituents’ interests and supports the government’s wider priorities.

Building and strengthening relations with MPs is at the core of effective political engagement. An MP who understands your business and believes in its potential can be a powerful advocate by championing your work in parliament or connecting you with relevant ministers and officials.

Although the political pace of the parliamentary summer recess might feel slower, this is no time for businesses to wind down. Whether through strengthening relationships with civil servants, preparing for the party conference season, or engaging directly with MPs in their constituencies, the weeks remaining weeks until 1 September grant businesses the time to reassess their political engagement. Using this time productively will enable businesses to position themselves as constructive partners to government, trusted to feed into the conversations that will shape Labour’s next year in office and beyond.

Food standards or economic growth? A very British trade-off

Recent months have been busy for Prime Minister Keir Starmer, having secured trade agreements with the EU, USA and India which promise to rewrite the future of the food and agriculture sectors. With these agreements having largely been welcomed by the UK food industry, attentions will now turn to ensuring the UK remains firm in a turbulent geopolitical environment to uphold future protection of UK food production.

UK-US

Among the most headline-worthy agreements is the revised trade policy for the beef and bioethanol sectors between the USA and UK. The Prime Minister allayed tariff concerns and secured reciprocal access to US beef markets, permitting British farmers to export up to 13,000 metric tonnes of beef per year. In return, the 20% tariff on US beef imports has been removed, as have tariffs on US ethanol and bioethanol.

The government has assured the food industry that closer ties to the US market will not be to the detriment of UK food standards. Concerns over chlorinated or hormone-treated meat, which is legal in the US but banned in the UK, have frequently been raised by British farmers and consumers. Defra secretary, Steve Reed, clarified that British standards will be upheld and agricultural food imports must still adhere to UK standards. The UK has previously come under pressure from the USA to dilute these standards.

While the UK appears firm in its resolve this time around, some in the sector are concerned that competition with cheaper and lower quality international products might push British farmers out of the market and force the government to revise its standards. The National Farmer’s Union has expressed concern that US beef might undercut British beef as it is often cheaper, making it an attractive product to hospitality and catering groups but putting British meat at risk. The food sector should be vocal about holding the government to account on food safety and standards, and promoting British products, in order to insulate the sector from potential risks.

While the agreement presents a series of opportunities for British farmers to capitalise from profitable US beef markets, the industry must closely monitor the UK’s dedication to strict food standards.

UK-India

The UK has signalled its interest in forging closer economic ties with India, with the IMF predicting it to be the third largest economy by 2030. The UK-India Free Trade Agreement commits India to reduce tariffs on 90% of UK exports, with the UK in return scrapping tariffs on 99% of Indian exports. Similarly to the US agreement, it is hoped that this will reap long-term benefits for British farmers.

Lamb exports to India, which had previously been subject to a 33% import duty will now face no cost, increasing British competition in Indian markets. Other UK goods including chocolate, salmon and cod will also be tariff free, and alcohol including whisky and gin will see their tariffs halved to 75%.

Following the deal, the government has confirmed that British food standards will be upheld. However, Indian use of pesticides has been raised by farming and environmental groups who have suggested this could cause risk to UK consumers. The Pesticide Action Network has labelled the deal a ‘toxic trade’, given the higher number of highly hazardous pesticides that India permits on its produce. As concerns have been mounting following both the India and USA agreement, businesses operating in the food and farming sector should consider how they best communicate their concerns to government.

UK-EU

Rounding off a busy month of trade negotiations was the agreement with the EU. A natural ally on the importance of high food standards, the EU deal was a slightly simpler process given there was no pressure to dilute the UK’s position on food and welfare standards. The deal removes some routine checks on animal and plant products, easing the flow. Additionally, the deal enables raw meat including burgers and sausages to be sold back to the EU for the first time following Brexit under new sanitary and phytosanitary (SPS) agreements.

While the trio of trade agreements will significantly broaden opportunities for British farmers and help boost UK competition, many fear they will ultimately dilute the government’s commitment to food and welfare standards. The government has signalled that it is not willing to jeopardise its commitment to health and food standards – yet. However, food and farming businesses must remain alert to the threat that cheaper overseas products can have on British markets and the potential for costs to be saved through lower food safety regulations.

Despite the government’s commitment to “Back British” produce so that 50% of food supplied in catering contracts comes from British farms, it is essential that Defra is held to account on this. Keeping on top of government policy and actively communicating the importance of food standards to policymakers will be key to protecting British food.

Sugar, we’re going down: is the review of the soft drinks industry levy a taste of things to come?

The health secretary has warned he will “steamroll” the food and drink industry by launching a new plan to tackle obesity. In an interview with The Guardian setting out his priorities for the year, he said the move is part of a broader focus on preventing ill health rather than simply treating it. The plan is being worked up across government departments and the sector will soon be invited to feed into a consultation process.

Is this political rhetoric indicative of a heavier-handed approach to public health than under the previous iterations of government? Our gut instinct is yes, but proof of the pudding will be in the government’s response to the Soft Drink Industry Levy (SDIL) review. Launched last October, health and treasury ministers are considering revisions to the existing sugar content thresholds, including increasing the scope to milk-based and milk substitute products, and the levy rates.

Although the SDIL is widely considered to be a successful and effective policy intervention, the UK’s sugar consumption remains significantly above recommended levels, especially among children. By lowering the sugar thresholds and widening the scope of products, more soft drink producers will be impacted by regulations and will be forced to either reformulate products or see their production costs increase. The review will be completed in the spring with changes enacted in the 2025 Budget, so producers should be closely following policy developments throughout the course of this year. The government’s response to the review will set the mood music for the National Food Strategy so this is a crunch point for all those in the sector, not just soft drinks producers.

Beyond the health merits for cracking down on sugar content, there are political and economic factors at play. Politically, the Prime Minister insists that 2025 is a year of delivery after a slow and difficult start to his tenure. Further state intervention in food and drink markets in the name of public health would play to a large section of the labour backbenchers. Party morale is likely to be put to the test in the coming months as the nation’s economic woes continue. This is where HM Treasury comes into the picture; amid turbulent financial markets and disappointing economic growth, the Comprehensive Spending Review will be an uncomfortable experience for the Chancellor and her team. Raising revenue from the levy could ease some of the pressures that will undoubtedly fall on the schools budget, which the levy supports.

For industry there is a fine balance to strike. Full resistance to public health reform would be counterproductive and leaves a bad taste in the mouths of consumers. Developing and maintaining an open, constructive dialogue with government, including showcasing innovative reformulations, will be a far more effective approach. Framed in this way, industry will be able to better make the case that a proportionate approach to SDIL and wider reforms will deliver positive health and economic change.

If you would like to discuss the sugar levy and the government’s public health agenda in more detail, please contact GK Associate Director David Mitchell at: david.mitchell@gkstrategy.com

The £0.5bn revenue raiser, incurring the wrath of farmers

GK Senior Adviser James Allan visited the farmers protest in Westminster and assesses the likelihood of a government u-turn and its agriculture policy plans.

On 19 November, farmers were out in force and took to the streets of Westminster for a heartfelt protest for a sector that feeds the nation. At the autumn budget, the Chancellor Rachel Reeves introduced a cap of £1m for assets eligible for Agriculture Property Relief and Business Property Relief. Estimated to raise £0.5bn a year by 2029/30 for spending on public services, the measure has been dubbed a ‘family farm tax’ for farmers that “don’t do it for the money because there is none”.

The extent to which the Chancellor’s action equates to a “death knell” for the family run farm is somewhat contested. While the Country Land and Business Association estimates 70,000 farms will be impacted by the change, various policy wonks and tax specialists argue that this does not consider other reliefs and is based on the quantity of farms, rather than ownership structures. Disputed figures aside, it risks fueling a shift public opinion against the government and one of the shortest-lived honeymoon periods for a new Prime Minster. A survey carried out by JL Partners found that 53% of respondents felt the autumn budget was unsuccessful, so the farming community are not alone.

Is this Reeves’ Cornish pasty tax moment?

When then-Conservative Chancellor George Osborne introduced a 20% tax on hot foods to end VAT anomalies in 2012, few anticipated the political drama of “pastygate” which ensued. The Conservative government was criticised for being out of touch, with some commentators even alleging class war. Then Prime Minister David Cameron was caught out for saying he’d eaten a pasty in Leeds Railway Station when the West Cornwall Pasty Company duly noted that the pasty outlet had closed two years previous. The controversy detracted from Osborne’s budget and ultimately led to a government u-turn and a negative with 49% of people describing the government’s handling of pastygate as a “shambles”. In a similar vein, the political fallout from this protest will be difficult for the Labour government to manage. Whatever Reeves’ next move, pastygate demonstrates that u-turns are not unprecedented when public opinion moves against a pinch point policy issue.

Beyond the political drama

Politics aside, the protests cut to the core of several interrelating policy issues, chief among them food security. Should farmers up the stakes and choose to strike, the government has already confirmed contingency plans to mitigate against likely food shortages. Any disruption to already fragile “just in time” food supply chains, which are a hallmark of the British supermarket industry, would have an immediate knock-on effect for the consumer, and in turn, the voter. This year of global elections has demonstrated that voters do not reward incumbents when food prices rise.

Yet given the 60/40 split of domestic and imported food produce respectively, the issue of food security is both desperately domestic and international. Russia’s invasion of Ukraine not only led to record levels of food inflation, hitting low-income households the hardest, but also a decline in business investment in the UK food and drink sector. Then there’s the issue of climate change. While India and Pakistan account for roughly 46% of UK rice imports, the government acknowledges that India is increasingly a climate vulnerable country. In short, a greater dependence on food imports arising from a possible collapse of domestic farming exposes the UK to yet more unpredictable geo-political and climate risks.

The British farming sector does not operate in isolation; it is critical to the UK’s broader rural economy, supporting industries such as agricultural machinery, agri-tech and innovation, and food processing. More than this, farmers are custodians of the UK countryside, contributing to environmental goals of biodiversity, carbon sequestration and sustainable land management and forestry. Though contentious, the Chancellor’s action prompts a broader conversation about agricultural reforms which align with national priorities and ensures the voice of the farming community is heard. The government has yet to set out substantive details but spoke of a new deal for farmers during the election campaign. Now in government, Defra Secretary Steve Reed has signalled a focus on trade deals undercutting low welfare and low standards; maximising public sector purchasing power to back British produce; and a land-use framework to balance nature recovery and long-term food security.

Whether Reeves doubles down or pivots on the Agriculture Property Relief depends on the government’s willingness to expend political capital to defend its decision. Labour’s instinct will be to fight on but the party finds itself on new ground. Its broad but narrow majority is part contingent on non-traditional Labour voters, many of them in rural areas. The MPs in these constituencies will have their eyes on a 2029 general election. Maintaining the rural vote and positioning Labour as the party of both rural and urban communities will be a challenge for the government. How Starmer and Reeves handle the ‘family farm tax’ could well define this iteration of the Labour Party. For investors and businesses alike, keeping abreast of these political battlegrounds, and preparing for the associated commercial risks and opportunities, will be important in making the case to a government that might well bend to a shift in public opinion.