Agriculture (Miscellaneous Amendments) (EU Exit) Regulations 2019
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Lord Gardiner of Kimble
That the Grand Committee do consider the Agriculture (Miscellaneous Amendments) (EU Exit) Regulations 2019.
The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Lord Gardiner of Kimble) (Con)
My Lords, I declare my farming interests as set out in the register. I hope it will be helpful to your Lordships if I speak to the instruments together, given the close connection between them.
These statutory instruments primarily amend retained EU law relating to the common organisation of markets in agricultural products. They also make minor amendments to cross-cutting common agricultural policy legislation and legislation governing rural development programmes and maritime and fisheries funds. The CMO sits in Pillar 1 of the common agricultural policy and was set up as a means to meet the objectives of the CAP. Over time, it has broadened to provide a mechanism that enables the EU to incentivise collaboration between, and improve the competitiveness of, agricultural producers and to facilitate trade.
The framework legislation of the CMO, which contains the basic rules for the schemes therein, was debated in this House earlier this year. The legislation considered today is technical in nature and limited in scope, as it primarily amends legislation setting up the finer details of the CMO to ensure that its provisions can continue to work after we leave.
Bearing in mind previous discussion, I assure your Lordships that we are adamant in upholding standards and maintaining process and are keeping as close to the current system as possible. The legislation makes appropriate corrections to ensure that the current system and its processes are operable after exit.
The Agriculture (Miscellaneous Amendments) (EU Exit) Regulations 2019 primarily make operable functions contained in EU legislation relating to the CAP and the CMO currently carried out by the European Commission or member states in the reserved areas of import and export controls, international trade and regulation of anti-competitive practices and agreements. Under the amendments, those reserved functions will instead be carried out by the Secretary of State or, in one instance, in relation to contractual negotiations in the dairy sector, by the Competition and Markets Authority. Some of these functions are administrative; for instance, to recognise hop producer groups. Others are powers to make regulations to amend rules relating to particular schemes; for example, conditions for recognition. The powers conferred are limited to those of reserved competence. They include powers such as setting conditions for when an export licence may or may not be required, fixing amounts payable on exports where they are subject to an international agreement, updating standard terms for sugar sector contracts and making additional requirements with respect to customs procedures where it is necessary to do so for the purposes of CAP checks. The instrument also makes operable retained EU law concerning producer organisations, import of eggs and contractual negotiations in the dairy sector.
Examples of the amendments made are: omitting obligations to report information on producer organisations to the Commission; conferring on the Secretary of State the power to recognise producer organisations, which currently lies with member states; a requirement that the Secretary of State must make a determination of equivalence in relation to the marketing standards of eggs from a third country before eggs from that country may be imported; and providing for notifications on volumes of milk covered by contractual negotiations, which are currently provided to member states, to be provided to the Secretary of State.
Lord Gardiner of Kimble
My Lords, I have every sympathy with the noble Lord, Lord Jones, because I always go to the Explanatory Memorandum first. I congratulate colleagues and officials who have given us a comprehensive understanding of the background of these technical changes. In seeking to address these points, it is important to understand the context, which is that we are having to fine-tune systems that we are going to have across the UK in one way or another and it is very important that there is certainty. I understand this involves noble Lords, particularly the noble Baronesses on the Front Bench and some of my noble friends, in considerable scrutiny, but we must get this right. I was struck by the words of the noble Baroness, Lady Bakewell: “We must get this right”. That means that when we make typographical errors or whatever, they should be attended to as soon as possible.
I shall run through the commentary. My noble friend Lady McIntosh and the noble Baroness, Lady Bakewell, referred to the exchange rate matter. The 2018 exchange rate was used to convert euro amounts in the retained EU regulations into sterling amounts. This is a one-off amendment. In future, we will take licensed securities in sterling. There is therefore no reason to peg these figures to the euro exchange rate. As I say, this is a one-off amendment and the figures will now be dealt with in sterling.
My noble friend Lady McIntosh asked about cost recovery. We take securities in the area of import and export licences. The only payment required to obtain an import or export licence is a security which is taken and held by the RPA. The RPA releases the security when it receives proof that the obligations specified on the licence have been fulfilled. As a result, there is no cost to an operator who uses the licence as intended. I understood that anyway. My noble friend also spoke about export refunds. In line with our WTO obligations, we have committed to the phasing out of export refunds from 2020. The EU has not used export refunds for quite a number of years.
The noble Lord, Lord Jones, made a powerful speech. He is a champion of upland farmers across the kingdom, but particularly those in Wales. Having walked parts of Powys—the beacons—and Snowdonia in my time, I recognise the beauty of that landscape. Let us not forget why it is so glorious. It is because of that particular brand of pastoral farming, the custodianship of the upland farming community and the culture that goes with it. We should treasure that. That is why the noble Lord is right to refer to tourism. They are places people want to go to because of the culture that those great families have produced over the generations. I would be failing if I did not also mention the high-quality Welsh lamb and Welsh beef they have produced, as well as Anglesey sea salt. All these are products of which we should be proud.
It is not just the uplands of Wales. There are the lowlands as well, which my noble friend Lady Byford mentioned. Farming communities across this country are essential not only because of their glorious food but because of what they do and will do as we take ourselves through the environmental enhancement. It is essential that we work collaboratively with the farming community. With over 70% of the land in the UK farmed, and the figure is probably much higher in Wales, this is the route by which environmental enhancement—habitat recovery, nature recovery and wildlife recovery—will happen.
On the question of devolution, agriculture is devolved. Yes, there are elements relating to Wales in the Agriculture Bill. I am looking forward very much to opportunities for further discussions, perhaps tomorrow but also on agriculture legislation. In championing devolution, I should say—and I am going on to talk about common frameworks, which are hugely important—that the Welsh Government launched their new consultation, Sustainable Farming and our Land, on 9 July, which will be open to responses until 30 October. In England there is the environmental land management proposal, as a way of recognising what farmers do by way of public benefits.
I turn to the issue of divergence, and I thank the noble Baronesses, Lady Bakewell and Lady Jones of Whitchurch. In respecting the areas of devolved competence, my feeling is that at both official and ministerial level there is a strong recognition of what I would call common sense prevailing. UK government officials have been working closely with officials from all devolved Administrations to design future common frameworks where they are necessary and desirable. The Scottish and Welsh Governments continue to commit not to diverge in ways that would cut across future frameworks where it is agreed that they are necessary, or indeed where discussions continue. And not forgetting Northern Ireland: the Government remain committed to restoring devolution in Northern Ireland, but also acknowledge the engagement that has continued with the Northern Ireland Civil Service on common frameworks.
I have here a note on the discussions. The Secretary of State and the Minister of State, Mr Eustice, meet Lesley Griffiths from Wales, with whom I have a good connection; they meet Fergus Ewing from Scotland, with whom I have worked on a number of issues; and of course they meet DAERA officials, who have been most helpful to all of our Lordships on the SIs relating to Northern Ireland. All the Administrations are taking the issue of divergence forward in a very sensible and professional way. We respect the devolution arrangements, but common sense clearly suggests that there are ways in which we can work forward to the common good for businesses, consumers and indeed well-being.
The noble Baroness, Lady Jones of Whitchurch, specifically mentioned Wales and the issue with certain elements of the statutory instruments. There are some circumstances where the mechanism does not apply to Wales. That is because certain provisions are specific to the Welsh devolution settlement. That said, the Welsh Government have carefully considered whether the Secretary of State should be able to act on their behalf in respect of each of the functions concerned, and the drafting reflects that. Again, certain elements of the settlement relating specifically to Wales mean that it will be bringing forward its own statutory instruments, but that is within the mechanism of co-operation and understanding. To conclude on the divergence/common framework position, we are absolutely clear—if I might say this on behalf of all the devolved Administrations—that we are working together, I think successfully, at ministerial and official level because that absolutely makes common sense and is right for the United Kingdom.
The noble Baroness, Lady Bakewell, referred to poultry stakeholders. We have engaged with poultry breeders through the UK Livestock Brexit Group, which is made up of representatives from the livestock sector including the British Poultry Council, which itself represents all parts of the poultry sector—breeding, hatching, growing and processing. On amendments made to provisions concerning poultry and poultry meat, we have engaged with the British Poultry Council directly. The noble Baroness also referred to crisis payment examples. I must say that these have never been applied in the EU since the introduction of that provision in January 2014. There are no examples of such crises in EU law. I do not know whether that requires further consideration but my understanding is that there is no reference.
Lord Jones
The Minister is very persuasive. He persuades me to request that he writes, when he considers the debate, with as many assurances as he dares.
Lord Gardiner of Kimble
I think I have given the Committee assurances that these statutory instruments are technical and operable. We have gone into a wider debate about the Government’s support for agriculture and agricultural communities. We want agriculture to prosper in all parts of the kingdom. We obviously look to the farmer for many things, and we will continue to do so. This is an opportunity for me, in declaring my farming interests, to say that we must work very productively with farmers across the United Kingdom, for all the reasons I have outlined. I give that assurance to the noble Lord and to the Committee.