Boris Johnson has tried to quell a fierce cabinet row over a planned UK-Australia trade deal, rejecting British farmers’ claims that an accord would amount to a “complete betrayal” and devastate many smaller holdings.
The prime minister, who will try to broker a cabinet truce on the issue at a meeting on Thursday, is determined to secure an agreement with Australia to make good on his claim that Brexit would unlock a series of trade deals.
Downing Street insisted on Tuesday that a deal would “include protections for the agriculture industry and won’t undercut UK farmers or compromise our high standards”, but that view is strongly contested.
Minette Batters, president of the National Farmers Union, said that if Britain agreed a zero tariff trade deal with Australia it would set a dangerous precedent for trade negotiations with the US and New Zealand.
“If we go down this road I fear that it will be a complete betrayal,” she said. “As a precedent deal, it is absolutely essential that the government holds the line.” The NFU has been lobbying MPs to win their support.
The Financial Times revealed on Tuesday the ferocious ministerial dispute, with Liz Truss, international trade secretary, arguing that if Britain cannot do a trade deal with Australia, its prospects of securing other deals would be minimal.
But George Eustice, environment secretary, is demanding tough protections for British farmers, who fear they could be undercut by much larger Australian rivals operating under lower standards.
He is backed by Michael Gove, Cabinet Office minister, who fears the deal could have a particularly profound impact on Scottish and Welsh hill farms, fuelling doubts about the future of the union.
Scottish National party MP Jim Fairlie, said: “Granting tariff-free access to farming produce would completely betray the promises that have been made by countless Tory ministers and prove that Boris Johnson is willing to sacrifice the interests of Scotland’s farmers and producers to satisfy his Brexiter cabinet.”
Truss, a champion of free trade who is revered by many Tory activists, is turning up the pressure on her cabinet colleagues. One supporter said opponents of the Australia deal were “stuck in a pre-Brexit EU mentality”.
Truss argues that a deal with Canberra would open up markets for British exports of whisky, cars and services, while she is also trying to negotiate better opportunities for UK citizens to work in Australia.
She also sees a deal with Canberra as a gateway to Britain joining the CPTPP free trade area in the Asia-Pacific region.
To protect smaller British farms she is looking to liberalise tariffs on Australian exports over 10-15 years, while quotas could be put in place to avoid a surge in low-tariff meat imports to the UK.
Truss’s supporters talk of a “chorus of protectionists” in Whitehall, pointing out that Australia only accounts for about 1 per cent of UK beef imports; Asian markets were much more important for Australia.
The RSPCA animal charity said Australia had lower standards than the UK, including chlorinated chicken, sow stalls that confine pregnant pigs, growth hormone treatment for beef, and longer journey times for live animals.
But the principal fear among UK farmers is that Australian farmers operate on a vastly bigger scale than less efficient British farms, many in upland areas, and that they would be undercut on price.
Truss’s critics point out that her department estimates a trade deal with Canberra would only boost UK gross domestic product by 0.01-0.02 per cent and that Australia was extracting a high price for a deal.
David Henig, director of the UK trade policy project, said: “This is what the Australians always wanted — to be at the head of the queue — and their positions are a reminder that no one in trade talks come bearing gifts.”
While the NFU was lobbying MPs on Tuesday to oppose a zero-tariff trade deal, George Brandis, Australia high commissioner to London, was making the opposite case at Westminster. One participant said the response among Conservatives had been very positive.
Dan Tehan, Australia’s trade minister, said last month the vast majority of issues had been resolved following a visit to London for negotiations with Truss.
Canberra has also pushed hard to get greater labour mobility between the two nations by streamlining visa processes for skilled workers and expanding the mutual recognition of qualifications.
Both sides have said they are engaged in “a sprint” to secure a deal by June. Johnson has invited Scott Morrison, his Australian counterpart, as a guest to next month’s G7 summit in Cornwall.
Gary Streeter, veteran Conservative MP for South West Devon, said: “This is where the rubber hits the road in the debate between free trade deals and ‘global Britain’ and damaging our own farming and domestic industry.”
He said there would be “unhappiness on the Conservative benches” if farmers were not properly protected, but added that UK farmers had to innovate.