The UK will on Friday offer Australia a tariff-free, quota-free trade deal after Boris Johnson insisted it should go ahead in spite of warnings it could seriously damage British farmers.
Downing Street refused to comment on the details but has not denied a report in The Sun that tariffs would be removed after 15 years to give British farmers time to prepare to face new competition in areas like beef and lamb.
That outcome represents a victory for cabinet free traders, led by international trade secretary Liz Truss, who insisted that Britain should offer Australia a similar deal to the zero-tariff, zero-quota deal it struck with the EU after Brexit.
Truss will discuss the proposal on Friday with Dan Tehan, her Australian counterpart, who had insisted that any trade deal with the UK should include full tariff liberalisation, including on agriculture.
George Eustice, UK environment secretary, had argued that zero tariffs should only apply to a specified quota of beef or lamb imports, so that protections could be maintained in the event of a surge in imports.
But Australia had indicated that such a restriction would not be acceptable and Johnson, at a meeting of senior cabinet ministers on Thursday, insisted that an ambitious deal should go ahead.
On Wednesday Johnson told MPs that British farmers were innovative and could be confident of selling their high-quality products around the world.
Beef and lamb farmers, particularly in Scotland, Northern Ireland and Wales are among those most exposed to cheaper competition from Australia, whose farms operate on a much larger scale.
Robert Buckland, justice secretary, told the BBC’s Today programme on Friday that Britain’s animal welfare standards would not be weakened to accommodate a deal with Canberra.
“The government has always said any free trade agreement we reach with Australia or other countries around the world . . . will of course take into account the very high welfare standards we apply in the UK,” he said.
“And of course we will make sure that British farmers are not undercut or put at a disadvantage bearing in mind the quality and excellence of the products made here in the UK.”
Neil Parish, Tory chair of the House of Commons environment committee, said this week that farmers in the UK would have to face “a little more competition” and would have to innovate in the coming years.
Meanwhile, farmers wishing to leave agriculture are to be offered a lump sum of up to £100,000 next year under plans set out by ministers as part of England’s move to a post-Brexit subsidy system.
The Australian trade deal was seen as a litmus test for Britain’s post-Brexit commercial policy by Truss and Johnson. But Eustice fears the generosity of terms offered to Canberra could set a precedent for other deals, including a possible future agreement with the US, which could further hit UK farmers.