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 Farmers' Union of Wales (FUW) has said.

The UK budget and spending review announced on October 27, 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.

The FUW said that 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".

Responding to the budget announcement, FUW President Glyn Roberts said:

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.

“We 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, but clearly that has not happened."

Budget cuts

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 UK Government’s decision to further slash the Welsh agricultural and rural development budget by an average of £37 million per year for the next three years breaks their promise to farmers and rural communities yet again” added Roberts.

This means that Welsh agriculture will be around £248 million worse off by 2025, almost the equivalent of a year’s worth of direct [Pillar I] payments, revealing the truth behind the promises made by prominent Brexiteers and in the 2019 manifesto.

"Such cuts will undermine family farms, the rural economy and rural employment at a time of extreme uncertainty," said Roberts.

Roberts said the FUW would 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.

"Critical to the viability of family farms and rural economies is the maintenance of the BPS budget, and we welcome the Welsh minister's commitment to maintaining this in the coming years."