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A taxing question
Whether to tax pesticides or not is a hotly debated issue that the UK government has aired in recent months. Over the summer, the hackles of the normally unflappable pesticides lobby have been raised. With the farming industry in tow, an anti 'Just Say No' stance has been launched. Meanwhile environmentalists have joined forces to support such a tax that would help reduce unwanted pollution caused by these chemicals. John Harvey investigates.
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To tax or not to tax? |
Both the tax and attempts to cut pesticide use stem from a 1990 government White Paper(1) which sought to "limit the amount of pesticide use to the minimum necessary for the effective control of pests compatible with the protection of human health and the environment."
Those opposing the tax include the National Farmers Union, the British Agrochemicals Association (representing pesticide manufacturers) and Farmers Weekly magazine, which has been running a "Just Say No" campaign against the tax.
On flights So far, 1,600 farmers and others have written to the magazine supporting its campaign: their petition will be presented to Mr Meacher. Perhaps it is more of a surprise to find Dr Vic Jordan in the anti camp. He leads the LIFE project (Less Intensive Farming and the Environment) at Long Ashton research station, near Bristol, and argues that farmers will cut their use of pesticides anyway through a combination of falling cereal prices and integrated crop management (ICM) methods.
The environmental group Friends of the Earth agrees with the tax. According to Simon Bullock of FoE: "A pesticide tax which aims to reduce the overall level of pesticide use should be introduced." The Environment Agency (which advises the UK government) supports "a modest tax or product charge combined with a suite of other measures."
Andy Croxford, pesticides manager in the agency's ecotoxicology and hazardous substances national centre, said at least some of the revenue raised should be used for environmental good. "For example, the countryside stewardship scheme has an option for buffer zones to reduce pesticide run-off. But at the moment it is discretionary and limited by the budget. The agency is responsible for reducing the ecological impact of pesticides on plants and animals, and in water and for making sure that water reaching the water companies is 'fit for the purpose.' This means it should comply with the European Union's drinking water directive which sets a limit of 0.1 microgrammes for any pesticide in a litre of water leaving the tap."
Jonathon Curtoys of Royal Society for the Protection of Birds says: "There is a strong case for introducing an environmental tax on pesticides."
The pros and antis were rehearsing their arguments before Mr Meacher (photo)came to office. In 1996, with the Conservative government still in power, ECOTEC was asked to write a feasibility study for the (then) Department of Environment assessing whether economic instruments, including a tax, could minimise the use of pesticides. In November last year, a summary of the full ECOTEC study was included in a consultation paper from the Department of the Environment, Transport and the Regions (DETR)(2). Earlier-in March 1997-two companies called Risk and Policy Analysts (RPA) and Entec UK had sent a report to the Department of the Environment, still under the Conservatives, on the costs and benefits to farmers of minimising pesticide use(3).
It was this report more than anything else which provoked the British Agrochemicals Association (BAA). In a wave of publicity, the BAA denounced the RPA/Entec report for suggesting, in the BAA's words, "a potential cost saving to farmers if they fully adopted all available pesticide minimisation techniques of £274 million." The BAA hired Morley Agricultural Consultants to produce a critique of the RPA/Entec study(4), and in January this year, Morley reported that RPA/Entec had over-estimated the benefit to farmers of using pesticide minimisation techniques. A more realistic figure, said Morley, was £100.25 million.
ECOTEC has been asked to submit another report on how a pesticide tax could be banded to encourage the use of less harmful chemicals. This is the document which Mr Meacher is waiting for.
But Dr Dominic Hogg, ECOTEC's senior consultant, says that even the Morley study shows that farmers are still using too much pesticide. "Their own study shows that there are still savings to be made which give a net financial gain to the farmer." In its earlier study, on the basis of an estimate of farmers' likely responsiveness to a tax or charge on pesticides, ECOTEC had suggested that relatively high price increases would be needed to generate a significant change in the use of pesticides. In giving some examples of the level of tax required to force technical changes, a tax of 125% was used. This figure has been seized upon by those opposed to any tax or charge, particularly farmers' representatives.
It is far too early to say whether this will be the final figure, though. The inter-departmental group looking at economic instruments and pesticides has not even decided whether to go for a straight tax or an environmental charge. The DETR is the lead department of the group, which includes the Ministry of Agriculture Fisheries and Food, the Department of Trade and Industry, Customs and Excise and the Environment Agency.
If the group opts for a charge, it would probably be run by the Environment Agency and operate like water abstractions, which licence farmers to use a certain amount of water for a set charge. If the group opts for a tax, this would probably be collected by Customs and Excise, who already collect the Landfill Tax.
Pesticide tax proposals have been criticised because they would encourage farmers to import cheaper products from abroad. A Customs and Excise spokesman said there was nothing in European Union law to prevent a tax regime being devised which would prevent this happening.
Perhaps the most sustained criticism the inter-departmental group will face is that farmers are already following integrated crop management (ICM) techniques which cut pesticide use and are much better for the environment than a tax would be. This was the argument deployed by BAA/Morley Agricultural Consultants to show that the ECOTEC study had over-estimated the benefits to farmers of minimal pesticide use. The difficulty with this argument is that the data to back it up is not available. The Ministry of Agriculture does not know how much farmland is covered by ICM, and refers to LEAF (Linking the Environment and Farming), an organisation with 26 demonstration farms covering 350,000 acres (140,000 ha).
Dr Vic Jordan's LIFE project has 80 farmer groups. He has direct contact with 12 groups, each of which has 15 members. LEAF and LIFE have joined with FWAG (Farming and Wildlife Advisory Group) to form the Integrated Arable Crop Production Alliance. Later this year, Dr Jordan will present LIFE figures showing members have cut their herbicide use by 52%, their fungicide and insecticide use by 80%, and their nitrogen use by 40%. More importantly, their variable costs-that is the costs of inputs, including pesticides-are down by 35%.
"Yields within the whole system are down slightly," said Dr Jordan. "But profitability is up by five per cent and increasing as grain prices decrease."
This last point is important. Average grain prices have fallen in the last few years from £180 a tonne to about £80 a tonne. Part of that decrease is due to the strength of Sterling, but the Agenda 2000 reforms proposed for the common agricultural policy and the impetus to liberalise trade in farm products during the next World Trade Organisation talks means that grain prices may stay low. So farmers may have to cut their variable costs even more, which will cut pesticide use.
It is also possible that the latest high-tech machinery can help farmers use less pesticides. Tony Pexton, deputy president of the NFU, pointed out that he already uses a global positioning system on his farm for soil analysis which ensures his fields receive the right amount of fertiliser. Mark Paice, a research engineer at Silsoe Research Institute, said Silsoe had developed a spatially variable spray applicator, known as a patch sprayer-which will reduce the amount of chemical when it is used with a yield monitor already developed by Massey Ferguson. "We think we can do that without affecting crop yields," said Mr Paice.
Advisers may also persuade their farmer clients to use less pesticide. The BAA points out that in 1994, orange blossom midge attacked wheat and there was such a rush to spray that chemical stocks were quickly used up. This Spring, says the BAA, it looked as though the aphid population was growing fast. But advisers were telling farmers not to buy chemical spray because the weather conditions were not right for aphids to spread fast enough to be a threat later on. In the event, the advisers were proved right. The Environment Agency accepts the importance of advisers, and thinks any revenue from a tax could be used to improve the advice on pesticides.
Pesticides Trust [now PAN UK] comment
The Pesticides Trust, in common with many other
environmental groups, supports the introduction of
pesticide taxes, especially if a banded system taxed
environmentally hazardous products more heavily. In this
way sustainable farming would have an improved financial
advantage.
For example, we would expect a heavy
tax on pesticides like lindane, if severe restrictions
(see pages 6-7) were not placed on it-at the very
least-prior to the eventual prohibition on its use and
production.
It is also important that the tax be
used to fund non-chemical alternatives to pesticides.
1. This Common Inheritance: Britain's Environmental Strategy, London HMSO, 1990, 192pp.
2. Economic Instruments for Water Pollution, DETR, 1997, 71pp.
3. Private Costs and Benefits of Pesticide Minimisation, Risk & Policy Analysts and Entec, 1997, Part A 72pp, Part B 150pp.
4. An Analysis of 'Private Costs and Benefits of Pesticide Minimisation' Morley Agricultural Consultants Ltd, January 1998.
John Harvey is a broadcaster for the BBC radio programme Farming Today.
[This
article first appeared in Pesticides News No. 41,
September 1998, pages 8-9]