Relative cuts to Wales' agricultural and rural development funding allocation announced in the latest spending review break the Conservative manifesto pledge not to cut rural funding for the second year running.
The UK budget and spending review announced on 27th October revealed that an average of £300 million a year would be allocated to Wales for agriculture and rural development over the next three financial years.
This is £37 million less than the budget allocated in 2019 - a year in which the Conservative manifesto pledged to "guarantee the current annual [Common Agricultural Policy (CAP)] budget to farmers in every year of the next Parliament.”
The FUW made strong and valid arguments in response to the UK Treasury’s decision last year to adopt a creative interpretation of the manifesto commitment and allocate a budget some £137 million less than had been anticipated, by including unspent EU funds from the 2014-2020 CAP budgetary period in its calculations.
The FUW also recently wrote to Secretary of State for Wales Simon Hart MP urging him to do his utmost to ensure that this year the Conservative manifesto commitment was honoured.
The letter also noted that had the UK remained in the EU and Wales continued to receive the same proportion of the CAP budget, the average annual Welsh allocation of CAP funding would have been around £334 million (based on previous allocations and the £0.89/€ exchange rate) in addition to any unspent funds.
The announcement means that Welsh agriculture will be around £248 million worse off by 2025, almost the equivalent of a year’s worth of direct (Pillar 1) payments. Such cuts will undermine family farms, the rural economy and rural employment at a time of extreme uncertainty.
The FUW will continue to monitor further announcements on the spending review and engage with the Welsh Government on how these cuts will influence devolved funding allocations ahead of its budget announcement later this year.