Fair Dealing Obligations (Pigs) Regulations 2025
Baroness Hayman of Ullock Excerpts(5 days, 1 hour ago)
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Baroness Hayman of Ullock
That the draft Regulations laid before the House on 13 March be approved.
Relevant document: 21st Report from the Secondary Legislation Scrutiny Committee. Considered in Grand Committee on 12 May.
Fair Dealing Obligations (Pigs) Regulations 2025
Baroness Hayman of Ullock Excerpts(1 week, 5 days ago)
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Baroness Hayman of Ullock
That the Grand Committee do consider the Fair Dealing Obligations (Pigs) Regulations 2025.
Relevant document: 21st Report from the Secondary Legislation Scrutiny Committee
The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Baroness Hayman of Ullock) (Lab)
My Lord, these regulations use powers contained within the Agriculture Act 2020 which enable the Government to address power imbalances within agricultural markets. These fair dealing powers allow for regulations that impose obligations in relation to the contracts of those businesses—usually larger businesses—that purchase from smaller producers. The fair dealing powers in the Agriculture Act, and their first use in the Fair Dealing Obligations (Milk) Regulations 2024, have previously been debated in this House, with important contributions made. I therefore know that many noble Lords will agree that these powers can play a significant role in promoting fairness in this sector and beyond.
I should first say that the pig sector is a British success story, characterised by effective relationships between producers and processors. It is a sector that delivers high-quality products, enjoyed across the UK and around the world. However, where power imbalances exist, relationships are not always as fair as they should be. As a result, farmers have too often felt that they bear a disproportionate share of the risk when market challenges arise.
A public consultation in 2022, seeking views on contractual practices in the sector, highlighted several challenges faced by producers. Defra has developed these proposals in response to the concerns raised and in close collaboration with industry, aiming to ensure fairness for producers while taking account of the practical concerns of processors. I am pleased to report that many stakeholders believe we have struck the right balance—protecting farmers while supporting existing good practice.
There will be opportunity for detailed discussion, but I would like to begin by outlining some key provisions. First, I will say a word on existing structures that already serve to protect farmers. We heard from many producers that the collective negotiation undertaken through marketing groups is highly valued. These regulations preserve this arrangement, allowing collective sellers, who purchase pigs from more than one farmer without processing them, the same protections as individual sellers.
At the heart of the regulations is the principle that written contracts should be the norm. While many transactions already use written agreements, this is not consistent across the sector. Establishing written contracts as the default provides a vital safeguard for farmers’ rights and promotes greater transparency in commercial relationships. Although industry supported this approach, it was also clear that not every transaction requires a protected contract. The pig sector includes a functioning spot market, where pigs are traded off-contract, an important mechanism for managing supply. In these cases, and others, the regulations allow producers to issue a notice to disapply the requirements for certain purchases. However, in most cases, both farmers and processors benefit from certainty. When no notice to disapply is given, farmers must be offered a fully compliant written contract, which cannot be varied without their consent. We heard clearly that farmers often felt that changes were imposed on them unilaterally, and this is not in the spirit of an open and balanced relationship.
One of the key priorities raised was the need for clarity around agreed volumes of supply. Clear terms in this area will support better planning and ensure that both parties fully understand their responsibilities and the consequences if those commitments are not met. In the pig sector, pricing is already often linked to published data or other shared information, offering a level of transparency that benefits both parties. The regulations encourage this approach by placing fewer obligations on processors who base their prices on such information.
At the same time, we were clear that flexibility must be preserved. It is for producers and processors to decide together how prices are calculated, reflecting what works best for their commercial relationship. However, when pricing mechanisms use data or factors which are not clearly accessible to producers, it is right that contracts include provisions to allow farmers to verify that pricing is fair and consistent with the agreed terms.
In addition to volumes and pricing, the regulations require that contracts clearly set out all terms relating to the purchase, as well as essential elements of the agreement that define how the relationship will operate in practice. These include matters such as payment terms, delivery arrangements, and how and when the contract can be terminated. While the specific details of these terms can be negotiated between the parties, this clarity helps protect farmers by reducing the risk of sudden or unfair changes, ensuring that both sides understand their rights and responsibilities throughout the contract. Importantly, all contracts must include a dispute resolution procedure. This will promote dialogue and help sustain the successful relationships already present in the sector.
The regulations extend the enforcement powers of the Agricultural Supply Chain Adjudicator. The ASCA will investigate complaints about compliance with these regulations, as it already does in the dairy sector, on behalf of the Secretary of State.
Before I conclude, I should note that these regulations make an amendment to the Fair Dealing Obligations (Milk) Regulations 2024. After those regulations came into force, the Government were made aware of unintended consequences regarding tiered pricing in exclusive agreements. We received representations from businesses with shared ownership structures, explaining that exclusive supply is central to their model, and that the prohibition on tiered pricing was inadvertently penalising arrangements that actually benefit producers. These regulations therefore introduce a limited amendment to allow such practices in cases where a shared ownership structure is in place.
In summary, I hope I have demonstrated to noble Lords that these regulations represent a significant step forward for fairness in the UK pig sector. They respond directly to producer concerns, protect practices that work well, and will promote more balanced and transparent contractual arrangements. I beg to move.
Baroness McIntosh of Pickering (Con)
My Lords, I welcome the regulations before us this afternoon and thank the Minister for giving us the outline. It is an interesting backdrop, in the sense that pig prices seem to have been at their highest for a while now. I have come straight from a meeting with some Danish businesses—none of them farmers. While I am half-Danish, I wish to help only the British farmer, I should explain.
I am a big supporter of auction marts. How will this provision impact on sales through such marts? Will they be left pretty much as is allowed at the moment? Presumably, the regulations will come into their own at a different time, when the prices are particularly low and when the farmers, or pig producers, are not covering the full costs of their production.
Having been an MEP in an area with intensive pig farming and then having gone on to be an MP in another area with equally intensive pig farming, it was very sad to see the impact of foot and mouth disease on pig production. Many farmers will simply not go back into pig production again. Anything that we can do, like the content of these regulations, is very helpful indeed.
The Minister referred to the role of the Groceries Code Adjudicator, and I pay tribute to it. I still believe that we should go further and allow the adjudicator to look at the market and at particular supplies off its own initiative. If there is an imbalanced relationship that it is there to resolve—and overwhelmingly it has worked well—there is no way that someone is going to jeopardise it. That perhaps relates more to different sectors than to pigs, such as the dairy sector and fruit production. If you are in a contract and you are being unfairly discriminated against, it is difficult for you to jeopardise that contract by being identified as a complainant with the adjudicator. I take this opportunity to ask the Minister whether the Government will continue, please, to keep that under review.
Mindful of the fact of movement—which I do not think is covered by the regulations, but perhaps the Minister could write to me about this—we have a number of agricultural shows coming up at this time of year, right through to the autumn, and they are immensely important to the agricultural sector. Again, this probably covers sheep and lambs—I have not seen too many pigs at the Great Yorkshire Show, I have to say. Will the department give advice on movement of animals? I know it is on the case as regards avian flu, but some imports have already been banned because of foot and mouth existing in parts of the European Union. Will she make sure that the department gives advice at the earliest possible opportunity, well in advance of the shows taking place? That would be very welcome indeed.
I cannot let this opportunity go without singing the praises of the Malton pig factory. Again, while not directly within this remit, we have a bed and breakfast for pigs in North Yorkshire, and they are just as well looked after as we are at the famous bed and breakfasts that many of us stay in. One of the outlets for the bed and breakfast pig industry is the Malton Bacon Factory. It exported a huge amount to China, which takes pig’s trotters and other parts of the anatomy that I will not go into, which we do not enjoy in this country. That was a multi-million pound contract, and that might have gone by the wayside. The regulations focus probably more on those that do not necessarily have an initial contract.
One thing that struck me in the regulations—I am very grateful to the Secondary Legislation Scrutiny Committee’s 21st report—is that it seems very odd in this day and age that many contracts are still not made in writing. Will the Government insist on that through the course of the regulation? The committee highlights in paragraph 44 that the requirements will
“include that all contracts are made in writing, contain clear pricing terms and set out how the price is determined”.
That relates to my initial question about how this will impact—presumably, the auction marts will be left alone and this will relate just to those contracts that are done individually. I would be very interested to know what proportion of the market is intended to be covered by the regulations. I welcome the regulations this afternoon and the opportunity to raise those issues.
Baroness Hayman of Ullock (Lab)
My Lords, I am grateful for the broad support for the regulations and for the contributions that have been shared on this instrument. There seems to be consensus that, even in a market that often functions well, as we have heard, it is essential to protect the smaller producers in the supply chain, so I welcome the support.
The specific requirements that are set out in the regulations—on volumes of supply, pricing, contract variation and termination—represent a significant step forward for the pig sector. Dispute resolution provisions will also support continued dialogue and collaboration across the supply chain. At the same time, the regulations are designed to protect and support existing good practice. I am confident they will strengthen the many successful relationships that already characterise the industry.
I turn now to some of the specific points that were raised. Some noble Lords talked about the different flexibilities that we have built into the regulations. I want to be clear that we are confident that they will not be easily misused. The reforms deliver a real and meaningful improvement in transparency for pig producers, which has often been lacking in the past. If the reforms are to be effective, they have to be proportionate and reflect the realities of how the sector operates, which is why we have built in flexibility. That does not mean we are going to be hands off in the approach to it.
I assure noble Lords that implementation is going to be closely monitored. If we find that the flexibility is such that the notice to disapply is being abused, or if the behavioural changes we expect do not materialise, we will not hesitate to revisit our approach and take further actions. The noble Lord, Lord Roborough, asked if we are going to be keeping an eye on it, and the answer is yes.
The noble Baroness, Lady McIntosh, asked about auction marts. First of all, pig sales through auction marts are quite limited but they will not be impacted. This is one area where the notice to disapply may be appropriate to use. If a notice to disapply is given to the business purchaser by the producer, the regulations do not need to be complied with for that specific purchase. I hope that helps to clarify that.
The appalling pig crisis of 2021 and 2022 was mentioned, particularly by the noble Baronesses, Lady Coffey and Lady Grender. Everyone in the sector wants to make sure that that does not happen again. As we have heard, at the time, there were a number of related factors, including the Covid pandemic, a lack of skilled butchers and declining export demand, and we ended up with a backlog of pigs on the market, which is why we had the awful cull that we witnessed. That was quite unusual, though, and it was quite difficult to avoid what was almost the perfect storm that built up at that time. We need to learn from it, which is why these regulations will make sure that farmers do not bear any disproportionate levels of cost when market challenges come up in the future.
The regulations outline that both producers and processors need to be clear about the levels of supply that they can expect in advance. That will be subject to negotiation between the parties, to maintain flexibility, and those agreeing a contract would be able to agree any tolerances for over and under supply levels. The new rules outline that contracts should say in advance what the remedies would be for either party when agreed levels of supply are not met by the other party. This could be a financial remedy, a change in future volumes that would be supplied, or a suspension of existing penalties; we need to look at each individual situation. What is important is that it will be open for negotiation between the parties, written down in advance and subject to change only by mutual agreement of both the farmers and processors alike. The whole point is to ensure certainty and transparency across the marketplace.
The noble Baroness, Lady Coffey, referred to the Cranswick incident and the difficulties around animal welfare and the breaches at that particular abattoir. The Animal and Plant Health Agency is investigating—it investigates every allegation that is reported to it. Obviously, I cannot comment on that because it is ongoing, but I reassure the noble Baroness that APHA is looking at that.
Lord Deben (Con)
Should we not be extremely pleased at the immediate steps taken by supermarkets and others when they heard about this allegation? And it is an allegation at this stage. It shows that we now have a very much more acute understanding of how animals should be looked after and what welfare really matters, which is crucially important for those of us who believe that eating meat is a satisfactory and proper thing to do.
Baroness Hayman of Ullock (Lab)
The noble Lord is absolutely right to draw attention to the work the supermarkets did. They do not always get the credit that they should. That swift reaction was really important. It shows the industry coming together, right across the board, when something really appalling happens that is breaching regulations. I absolutely agree.
There were a number of questions about the Groceries Code Adjudicator and the Agricultural Supply Chain Adjudicator. The noble Baronesses, Lady McIntosh and Lady Grender, and others mentioned that. For those covered by the groceries code, the GCA has prioritised communication of the statutory requirement to maintain supply confidentiality. The GCA has relaunched the Code Confident campaign, launched a confidential reporting platform called Tell the GCA, and published a code compliance officer commitment to confidentiality, which we hope will help. The GCA’s fourth statutory review is currently ongoing. That is being led by the Department for Business and Trade and will also allow for feedback to be provided in this area and in others.
For those covered by the Agricultural Supply Chain Adjudicator, a complaint does not need to be made from a producer for ASCA to investigate and perform enforcement functions where necessary. The current Agricultural Supply Chain Adjudicator has confirmed that it will always seek confirmation from the producer that they are content for a complaint to be formally investigated before contacting a purchaser and sharing any information. It has also recently launched the Contact ASCA in Confidence service, learning from the GCA’s Tell the GCA scheme; this allows producers and anyone else to raise issues with ASCA confidentially. Although ASCA will not be able to open a formal investigation without an actual complaint, the information provided will help inform its activities.
On who will enforce this, which a number of noble Lords asked about, the option to expand the remit of the Groceries Code Adjudicator was explored in a formal call for evidence back in 2016. This concluded that the extension of the GCA’s role further along the supply chain would not be appropriate. Part of this is because the Groceries Code Adjudicator has a very specific remit: regulating the relationships between the largest grocery retailers in the country and their direct suppliers. These regulations focus instead on the contracts that pig farmers hold directly, which are almost exclusively with the processing companies. We are therefore confident that the Agricultural Supply Chain Adjudicator—obviously, it also handles enforcement for the dairy sector, as noble Lords will be aware—is the most appropriate means of enforcing these regulations. It will continue to focus on regulations made under Section 29 and this first important stage of the supply chain.
I mentioned dairy sector enforcement. The noble Lord, Lord Roborough, asked whether this will be sector by sector. It will be introduced sector by sector going forward.
I was asked whether the Agricultural Supply Chain Adjudicator has sufficient resources. ASCA was relatively recently established. Enforcement for the dairy regulations began only in July 2024—less than a year ago—and existing contracts are not being covered until July this year. Currently, the office is sufficiently resourced to fulfil its remit of enforcing the regulations in the dairy sector and, soon, in the pig sector. However, we will monitor resourcing requirements as the regulations take effect, so that we can respond accordingly if need be. Similarly, we will continue to do so as further reviews are conducted and as more sectors come into scope.
Why did we choose this route instead of reforming the GCA? We have talked about the fact that we did the consultation but, particularly for pig producers, this is a highly consolidated part of the supply chain. Just four processors account for the vast majority of pig purchases. We believe that, to deliver the greatest benefits in fairness and transparency, it is right that we focus on this primary relationship between producers and processors.
These regulations were developed with extensive engagement with industry, and stakeholders were invited to comment on detailed drafting—including the text of the statutory instrument itself—to confirm that they found the whole approach workable. We are committed to using the fair dealing powers wherever they are needed. We are now working with industry on the proposals for fresh produce and the egg sectors, which will be the next areas that we look to bring in. We will continue to work with stakeholders as we do that.
My noble friend Lord Jones asked about the size of the pig herd. We do not actually know how many pigs there are, but we know that the UK pig industry is worth £1.6 billion at the farm gate and £5 billion at retail. Considering food service, external sales and export values, we think it is worth over £14 billion in total. I hope that that helps him to understand the size of the industry.
Genetic Technology (Precision Breeding) Regulations 2025
Baroness Hayman of Ullock Excerpts(2 weeks, 4 days ago)
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Baroness Hayman of Ullock
That the draft Regulations laid before the House on 25 February be approved.
Relevant document: 20th Report from the Secondary Legislation Scrutiny Committee (special attention drawn to the instrument).
The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Baroness Hayman of Ullock) (Lab)
My Lords, these regulations implement the Genetic Technology (Precision Breeding) Act 2023 for precision-bred plants in England. They provide the practical and technical detail to implement a new science-based and proportionate regulatory system for precision-bred plants, as set out in the Act.
The territorial application of these regulations is England only and covers the environmental release and marketing of precision-bred plants as well as their use in food and feed in England. This includes a process administered by Defra to confirm that plants are precision bred—not genetically modified—before they can be marketed. It also establishes a food and feed marketing authorisation process administered by the Food Standards Agency which allows products to be placed safely on the market. The regulations also outline details for public registers and enforcement.
The Government recognise that concerns have been raised in the Secondary Legislation Scrutiny Committee’s report and in the regret amendment tabled by the noble Baroness, Lady Bennett of Manor Castle, most notably around provision of information and the impacts on the devolved Governments. We agree that these issues are important, and our work to understand and mitigate implications is ongoing. The department recognises that transparency is important and will be establishing public registers to ensure that information about precision-bred organisms authorised for marketing and for use in food and feed is available to consumers, farmers and landowners. We are also looking at ways to enhance this further and have recently closed a public consultation seeking to gather views on how to improve the accessibility of information on these precision-bred plant varieties, including through the labelling of seed and plant reproductive material.
We are also continuing to engage regularly with the devolved Governments on today’s legislation. In addition to monthly meetings at official level and regular ministerial engagement at the interministerial group, Minister Zeichner, as Farming Minister, is organising discussions with his counterparts in the devolved Governments to consider any concerns in more detail. Some of these talks have already begun and we value the progress that is being made. We also note that discussions are now taking place between devolved Governments and key stakeholders across industry on this policy area, and we look forward to hearing updates as this develops.
I believe that we have struck the right balance with an enabling regulatory framework that is proportionate and evidence-based, while providing measures for transparency and regulatory oversight. Today, by passing this secondary legislation, I believe that we have the opportunity to transform and modernise our food system —to make it fit for the future.
The 21st-century agricultural system faces significant challenges. It must provide enough food to meet growing demand while at the same time becoming more sustainable. It must also survive the threat to productivity posed by climate change. Food security is national security. To help us achieve this, we need innovation in fundamental sectors such as plant breeding. Precision breeding would be transformative for this sector, enabling innovative products to be commercialised in years instead of decades—and we do not have decades. Through precision breeding, crops can be developed that are more resilient to climate change, more resilient to pests and diseases, and more beneficial to the environment. In turn, this will increase food production, reduce the need for pesticides and fertilisers, lower emissions and reduce costs for farmers.
However, to capture these benefits, we need a regulatory framework with a sound science base that encourages innovation. The scientific consensus, across key advisory committees and institutes, is that precision-bred organisms pose no greater risk to health or the environment than traditionally bred organisms. The existing legislation carries a significant burden. According to the AgriFood Economics Centre, current regulations add a stifling 74% to the cost of marketing for businesses. This deters investment and limits the type of companies and products that can be brought to market. Countries that have kept pace with the science and introduced regulatory reform have seen significant investment. The Americas have attracted over 80% of venture capital investment in the sector, while only 5% comes to Europe. It is paramount that we act to change this.
Baroness Hayman of Ullock (Lab)
My Lords, I thank your Lordships for your contributions and comments in what has been a very interesting debate and, in most cases, for your Lordships’ support for the regulations. We have covered a bit of old ground as well.
I want to take a moment to reflect on the importance of implementing this legislation. Without it, the potential of precision breeding cannot be realised. The existing legislation carries a significant burden, limiting which companies can bring products to market and which crop species and traits we can benefit from. Our understanding of the science has advanced. It is not proportionate to apply the existing legislation to plants produced by modern biotechnologies when the overwhelming scientific advice is that they pose no greater risk than traditionally bred varieties. The secondary legislation that we have been discussing today will change this, providing a science-based approach that is proportionate to the level of risk. As my noble friend Lord Young said, we are taking an evidence-based, balanced approach.
I recognise, however, that there have been concerns and issues raised, so I will turn to these now. Devolved Governments were mentioned by the noble Baroness, Lady Bennett, and the noble Lords, Lord Wigley and Lord Dodds. We recognise the valid concerns that noble Lords raise on the issue of divergence within the UK, which is why we are continuing, as the noble Lord said, to regularly engage with the devolved Governments. My colleague in the other place, Minister Zeichner, has recently been speaking to our devolved Governments and has invited them to discuss the issues in more detail. This work will build on the regular monthly meetings that we already have with devolved Governments.
The noble Lord, Lord Wigley, raised the issues of progress and timing. We are making good progress in discussions. As I have said, the devolved Governments are considering their positions and holding discussions with the key stakeholders that are impacted. We wanted to crack on: we do not have the time to wait to realise the potential benefits. We have, as the noble Lords have said, gone through this in a very long debate on the legislation, but we recognise the importance of working closely with the devolved Governments.
On Northern Ireland, which the noble Lord, Lord Dodds, raised, I want to assure noble Lords that we recognise that this is an important issue, and we continue to engage with stakeholders and officials in Northern Ireland properly to understand the potential short-term and long-term impacts. That includes recent engagement with Minister Muir— Daniel Zeichner met him to discuss specifically the implications of precision breeding. We are also engaging with the EU at the UK-EU Agri-Food Structure Group on the potential implications of its proposed regulatory framework for Northern Ireland.
The impact on the organic sector was raised by a number of noble Lords. This is one of the areas where we have a lot of work ongoing. Our engagement with the industry has suggested that the first products that would come to market would not undergo significant further processing; so, they can be kept separate from traditionally bred material, which would mean that the exposure of organic production to precision-bred material would be very limited in the short term.
However, Defra is working closely with the organic sector to prepare for the medium-term and longer-term impacts by discussing non-legislative options for supply chain coexistence, including facilitating discussions to establish which measures currently used by industry could be used by farmers to enable coexistence between precision-bred and non-precision-bred crop production. That is in line with how things are approached internationally. The noble Lord, Lord Krebs, talked about cross-contamination and the importance of getting this right. Defra is also working with the organic sector to look at any other further potential issues in the wider supply chain.
Labelling came up a lot; many noble Lords talked about it. Obviously, it was a key area of debate during the passage of the Act, and I felt that we were revisiting that to a certain extent. As noble Lords have said, the Food Standards Agency Board concluded there was no justification for the provision of labelling on grounds of consumer safety, since there was no scientific evidence that precision-bred organisms are intrinsically more hazardous than traditionally bred organisms. Because this was not considered to be a safety issue, mandatory labelling to indicate the process does not align with the principles behind the policy and would also raise costs for both business and consumers.
Methods of production are normally voluntarily labelled and can be catered for by the market if there is the demand; that follows the approach taken by many partners abroad, including the current EU regulatory proposal. However, I think we would support the suggestion from the noble Lord, Lord Krebs, that voluntary labelling of benefits could well be very helpful. We have tried to get the right balance here. However, out of interest for your Lordships, there are discussions within Defra at the moment about how labelling for consumers could be improved. This is something we are looking at.
The noble Baroness, Lady Freeman, mentioned consumer views and transparency. The FSA regularly gathers consumer views on a wide range of topics, and the most recent data shows that the price of food remains the top concern for consumers, alongside food poverty, food inequality, sustainability and the healthiness of the food being eaten. The FSA continues to undertake regular polling and insights to track public attitudes. We know that public levels of understanding are low, but public sentiment is more in favour.
While I am on polling, the noble Lord, Lord Pack, mentioned the YouGov polling and why it was not published. It was carried out by YouGov to look at public perception. All three polls were designed for internal use to enable us to track whether our communications around the Act had been effective. It has now been published and can be found on the Government’s website.
Plant varieties and seeds were mentioned by a number of noble Lords, including the noble Baronesses, Lady Bennett and Lady Grender, and the noble Lord, Lord Cameron. Plant varieties of the main agriculture and vegetable crops must be registered on the Great Britain or Northern Ireland variety lists before seeds of the varieties can be marketed. To be listed, a new plant variety must undergo testing to confirm that it is new and an improvement on varieties that are already available to the market. As the Genetic Technology (Precision Breeding) Act 2023 removes precision-bred organisms from genetically modified organism regulations and requirements applicable in England only, a precision-bred plant variety list for England is proposed in addition to the existing variety lists.
The EU position was raised just now by the noble Lord, Lord Blencathra. I am sure that he will not be surprised to know that I cannot comment on the EU reset discussions. Among other noble Lords, the noble Lord, Lord Lansley, in particular, talked about the EU Commission’s proposal for the regulation of plants—the NGTs, mentioned by the noble Baroness, Lady Bennett. We are monitoring the EU’s position closely and have noted that there has recently been progress in the European Council on the draft NGT proposal. It is quite similar in aim to the Genetic Technology (Precision Breeding) Act 2023 that we have been talking about today, but it is clearly going to take some time before new legislation is implemented in the EU.
I reassure the noble Lord, Lord Blencathra, that all products from the United States will need to go through the regulatory system in order to be placed on the market.
Environmental and health and safety risks were talked about. This is understandable given the controversy around genetically modified organisms in the UK historically, which was mentioned by the noble Baroness, Lady Hayman, and my noble friend Lord Rooker. This is why it is so important to take an evidence-based approach and to work with experts as we develop the policy. The noble Lord, Lord Trees, made the point so strongly in his contribution: the scientific evidence is clear. The risk that a precision-bred plant poses to the environment and health is dependent on its characteristics rather than the technique used to develop it.
The noble Lord, Lord Cameron, mentioned Africa and the impacts of climate change. The purpose of the Act was to encourage investment in research and development and innovation in agriculture, which has huge potential for climate change and for developing countries, such as those in Africa, which need to move forward in agriculture. The noble Baroness, Lady Coffey —in her very important speech, with her experience from when this was first developed—talked about the importance of climate-resilient agriculture, which this will be able to support.
The noble Baroness, Lady Grender, mentioned safety of food and feed. I reassure Members that the Advisory Committee on Novel Foods and Processes advised that
“There is no evidence that precision-bred organisms are intrinsically more hazardous than traditionally bred organisms”.
The further movement of the Act towards including animals as well as plants was mentioned by the noble Lords, Lord Trees and Lord Blencathra, and the noble Earl, Lord Caithness. As noble Lords are aware, the scope of the regulations is just for plants, but we recognise that there is strong support in relation to animals and that Members are keen to know more about the Government’s plans and approach, and any potential timelines. To inform noble Lords, we are currently continuing research on this but, while it is going forward, we will not be bringing forward any further legislation on animals.
The final question was from the noble Baroness, Lady Bennett, who talked about the Cartagena protocol. We remain committed to our international obligations and the protocol. Our proposal is consistent with our obligations as a signatory.
In my opening speech, I outlined the challenges we currently face in the food system, and recent world events really have shone a spotlight on the urgency of addressing these. We must take advantage of the opportunities presented by new technologies and advancements in scientific understanding, and we cannot afford to inhibit innovation through having outdated regulations. Harnessing innovation in precision breeding can help us to achieve several priorities: bolstering food security and championing British farming, helping to mitigate and adapt to climate pressures, and driving the Government’s missions on growth and health. The growth potential is evident, and we have the opportunity to be right at the forefront. Voting to approve the regulations today, if the noble Baroness decides to call a vote, is the only way to implement the Act in relation to plants and to realise the potential benefits of precision breeding for farmers, consumers and the environment.
Agriculture (Delinked Payments) (Reductions) (England) Regulations 2025
Baroness Hayman of Ullock Excerpts(3 weeks, 3 days ago)
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Baroness Hayman of Ullock
That the draft Regulations laid before the House on 13 February be approved.
Relevant document: 18th Report from the Secondary Legislation Scrutiny Committee
The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Baroness Hayman of Ullock) (Lab)
My Lords, I declare an interest as I am in receipt of delinked payments. This instrument sets the reductions that will apply to delinked payments in England in 2025. These reductions are a vital part of the transition to more targeted public investment supporting farmers to boost nature and sustainable food production.
A fatal amendment has been tabled that, if approved, would mean the agricultural transition would effectively go into reverse, as no reductions at all would be applied. I want to be clear that voting against this SI would not keep payments at the level they were for 2024. Instead, it would mean that delinked payments would go back to the 2020 subsidy levels. The fatal amendment also calls for the reinstatement of applications to SFI, but, without the reductions set by this instrument, we cannot fund SFI. Indeed, payments under many of our farming schemes would need to stop completely.
The regret amendment that has been tabled expresses concern about the impact of the reductions on farm viability. This Government recognise that farmers run businesses that need to make a profit, and we understand the valuable role that these businesses play in the wider rural community. We want to support farm businesses to be more profitable and address the underlying problems so that they can thrive.
Delinked payments do not achieve that. Delinked payments do not offer and never have offered good value for money for farmers or the taxpayer. They are part of the move away from the basic payment scheme that saw 50% of money go to the top 10% of farms while doing little for food production or nature. We are now in the fifth year of the seven-year transition away from these subsidies. The reductions to delinked payments set out in this instrument were announced last October. These reductions accelerate the end of the era of payments to large and wealthy landowners simply for owning land.
However, the Government recognise the impact that these changes may have on some farmers, which is why we are trying to make them in the fairest way possible. We are applying the reductions in payment in bands, like income tax bands, meaning that those with the broadest shoulders will see the highest reductions.
I assure noble Lords that every penny released from delinked payments is staying within the sector. The planned reductions are necessary to help fund investment in the environmental land management schemes and our other grants for farmers. So our support for farmers remains steadfast. We have committed £5 billion to the farming budget over a two-year period, with £2.4 billion of this for 2025-26. That includes the largest ever budget directed at sustainable food production and nature recovery in our country’s history. We have allocated £1.8 billion in 2025-26 for environmental land management schemes. This will boost Britain’s food security and accelerate the transition to the more resilient and sustainable farming sector that we want to see. Importantly, we are on track to spend the farming budget in full.
There are record numbers of farmers in our environmental land management schemes; 50,000 farm businesses, and more than half of all farmed land in England—that is, over 4 million hectares—are now managed under these schemes. Figures for 1 March show that that includes around 38,000 live multiyear sustainable farming incentive agreements, and we expect to publish more information about our revamped SFI offer this summer, following the spending review.
The new Countryside Stewardship higher-tier offer will open for applications for invited farmers and land managers later this year. Applications for stand-alone capital grants will also reopen this summer after a short pause, and we are investing in around 50 landscape recovery projects that were awarded funding through rounds 1 and 2. In February, we announced increased payment rates for higher-level stewardship across a range of options from this year.
We are also extending the Farming in Protected Landscapes programme until March 2026. This extension will support farmers in protected landscapes to transition towards profitable food production, while at the same time delivering nature recovery and mitigating the impacts of climate change.
We are continuing to invest in farmers through our other grant offers, with up to £110 million available in new grant competitions that are starting this spring. This includes up to £47 million for Farming Equipment and Technology Fund grants, as well as up to £63 million available for Farming Innovation Programme grants. Those will help to improve productivity, trial new technologies and drive innovation in the sector. We are also expanding the animal health and welfare pathway, with more funded vet visits now available to farmers. Further, over 26,000 farmers have made use of free one-to-one business support through the Farming Resilience Fund to help them through the agricultural transition.
By investing in healthy soils, abundant pollinators and clean water, the Government are investing in the foundations that farm businesses rely on to produce high crop yields and turn over a profit. Adopting the sustainable farming practices rewarded under our schemes will also help farmers to reduce their input costs. Reducing delinked payments as planned enables us to make these investments through our other schemes, and we believe this will serve the best long-term interests of farming.
I welcome the recent appointment of the noble Baroness, Lady Batters, to lead the review of farm profitability to provide short-term, medium-term and long-term recommendations to the Government. The noble Baroness’s review will also help our development of the 25-year farming road map in order to make the sector more profitable in the decades to come.
As we set out in our plan for change, we are focused on supporting our farmers by boosting rural economic growth and strengthening Britain’s food security. This SI is an essential step in building this future. I beg to move.
Amendment to the Motion
Baroness Hayman of Ullock (Lab)
My Lords, I thank all noble Lords who have made valuable contributions to the debate. As always, I have listened very carefully to noble Lords’ concerns. As I mentioned in opening, my husband and I are in receipt of delinked payments—previously BPS—just for our small farm, but it means that I am very aware of the kinds of reductions that noble Lords have been talking about in the debate. However, delinked payments do not address the long-term challenges faced by farmers. The Government are making the decisions to try to build a profitable and sustainable farming sector so that we can deliver Britain’s food security.
As I mentioned earlier, the reductions to the 2025 delinked payments are necessary so that we can fund the spend, both committed and projected, under our other farming schemes, which support sustainable food production. We have seen increased uptake of the environmental land management schemes and unprecedented demand for our capital grants offer.
Without this SI, the spend on delinked payments in 2025-26 would increase to £1.8 billion, leaving a £1.5 billion shortfall in the farming budget. This would mean we would need to stop funding farmers through many of our other schemes, which would go completely against what seem to be the objectives of the fatal amendment.
The money released by reducing delinked payments is being reinvested in full through our other schemes for farmers and land managers. Every single penny is staying within the sector. How the farming budget has been spent for the financial year 2023-24 is set out in the latest Farming and Countryside Programme Annual Report. We will publish our next annual report later this year, as required by the Agriculture Act 2020. In March, we published on our farming blog a breakdown of how we plan to spend the £5 billion farming budget, covering 2024-25 and 2025-26.
I do understand the concerns that the House has raised regarding farm viability. There are a number of actions that we can support farmers with to improve their profitability. As well as urging them to take advantage of our existing offers, including grants that will support productivity and help them reduce their input costs, we can help farmers to diversify their income so that businesses become more resilient.
At the NFU conference, the Secretary of State announced a raft of new policies, including using the Government’s own purchasing power to back British produce wherever possible, and making £110 million available for new grant competitions to support research and innovation, technology and equipment for farmers.
I will now try to cover a number of the questions that noble Lords raised in the debate. The first is about the closure of the SFI and the concern that this will leave farms in financial distress. I confirm that every penny in all the existing SFI agreements will be paid to farmers and any outstanding eligible applications that were submitted by 11 March will also be taken forward. I also confirm that applications for the SFI have closed only temporarily and we plan to reopen the scheme for applications once the reformed SFI offer is in place.
A number of noble Lords, including the noble Baroness, Lady Grender, and my noble friend Lord Grantchester, asked what the reformed SFI offer might look like. We are working to align it with the work that we are carrying out on the land use framework and the 25-year farming road map in order to protect the most productive land and boost food security while also delivering for nature. The reformed SFI will also build in more sophisticated budget controls. As the scheme is designed and evolves, we want to listen to farmers to get their feedback to ensure that we learn from the past to improve the scheme for the future. It needs to be better targeted than previously.
On small farms, which the noble Baroness, Lady Grender, in particular, asked about, we are developing new schemes so that they work for as many different types of farm as possible, including smaller farms. There was, for example, no minimum amount of land that could be entered into the sustainable farming incentive. We will continue to work closely to make sure that the offer is properly accessible for small farms. As someone who has a small farm, I think we can improve that area, and we are working on that.
Tenant farmers were also mentioned by a number of noble Lords. The noble Baroness, Lady Grender, also mentioned the Rock review. We support the principles of the Rock review, and the department has already delivered on many of the review’s recommendations. The joint Defra and industry farm tenancy forum, which represents tenant farmers, landlords and advisers, will continue to play an active role in feeding back issues from the tenanted sector into Defra. The joint forum will help us continue to evolve our schemes to be accessible to tenants and to encourage collaboration between landlords and tenants in relation to environmental schemes. Working with the farm tenancy forum, we have also looked to remove penalties for tenants who may have to exit a scheme early if their tenancy ends unexpectedly. Our survey data shows that over a third of applications for SFI came from mixed-tenure and wholly tenanted farms.
A number of noble Lords raised the issue of farm profitability. We publish regular statistics on farm business income in England and other data related to farm businesses. For example, in March, we published the average farm business income forecasts, and our recently updated farming evidence pack sets out an extensive range of data to provide an overview of agriculture in the UK and the contribution of farm payments to farm incomes. That includes analysis by sector, location and type of land tenure. That kind of data is really important as we look forward to redesigning the schemes. The years 2021-22 and 2022-23 saw record highs in average farm business income at all farm levels, which was largely driven by higher output prices. Clearly, although there will be differences from farm to farm, we expect that the average farm was able to build some reserves to aid the ability to absorb the subsidy reductions that came in during the transition period.
Transitioning from the legacy agreements into new agreements was also mentioned. We are currently reviewing our approach to transitioning farmers from existing agreements into the new schemes. We expect to publish more information about this following the spending review. In the meantime, we have announced that we will increase the payment rates for higher-level stewardship agreement holders. To address the point made by the noble Lord, Lord Cromwell, if letters were supposed to have been sent out in April, it is clearly disappointing that there has been a delay. I have checked and this has been delayed. As the noble Lord has raised this here today, I will chase this and bring it up with the department.
The noble Earl, Lord Russell, and the noble Baroness, Lady Coffey, both talked about the impact assessment. Obviously, noble Lords are aware that one has not been produced for this instrument but, as I said, we are publishing regular statistics on farm income and other data related to farm businesses. That includes the farm business income statistics published on 14 November last year. We are looking very carefully at the income, and from that we will understand the impact on businesses as we go forward.
We are also looking to ensure fair competition across the supply chain through contractual reform. Fair competition was mentioned and it is incredibly important. All farmers should have a fair price for their products and the Government are committed to tackling unfairness in the supply chain wherever it exists. Regulations introduced last year included key reforms for contracts in the UK dairy sector. They included mandatory written contracts to require greater transparency in milk pricing. New contract rules for the UK pig sector were introduced to Parliament this month, which aim to ensure that terms are clearly set out and changes can be made only if agreed by both parties.
Similar regulations for eggs and fresh produce sectors will follow, and the Government are committed to intervene in any sectors where fairness issues exist. The regulations are enforced by the Agricultural Supply Chain Adjudicator, on behalf of the Secretary of State. Additionally, as I mentioned in my earlier remarks, the noble Baroness, Lady Batters, is leading a review of farm profitability. This important work is being supported by the newly formed profitability unit in Defra.
The noble Baroness, Lady Bennett, mentioned the basic income campaign. Of course, I would be very happy to meet the noble Baroness and any colleague she feels it appropriate to bring along to such a meeting.
We believe that this instrument is the essential next step of the transition period. The noble Baroness, Lady Coffey, pointed out the importance of the transition period. If we care about the future of farming—and clearly everybody in this Chamber very much does and feels very strongly about it, which has come across in the debate—we must not unravel the agricultural transition. This instrument will enable us to invest in that long-term future for farming while also delivering for nature.
Baroness Grender (LD)
I thank all noble Lords for speaking in this debate and providing their knowledge and experience on this issue. This is a crucial issue which deserves our full attention. I thank in particular the Minister for her response. I know that she, better than most, will be aware of the outcry that this sudden and unexpected cut has caused in so many in our farming communities.
It will not surprise noble Lords that I agree with the noble Lord, Lord Rooker, on this issue. If something like an SI falls, it goes back to the department and a new way, ideally, is found. Like him, I believe all pathways lead to the Treasury when these things go wrong. I also particularly pick out the point that the noble Lord, Lord Cromwell, made about HLS. I, too, have been in touch today with farmers who are deeply disappointed that they have not received the letter they were expecting by today. Those letters have not been received across the farming community. I thank the Minister for taking that back, but it is very significant, in addition to this regulation.
My noble friend Lord Russell described the times that the Conservative Benches have chosen to dispense with their aversion to fatal amendments. It is clearly a pick-and-mix tradition for them. I say to them that there has never been a more important vote; a chance to end this unfair cut to farmers. It is a test of their resolve on this issue and all they have to do is walk through the same Lobby as us. We all know that a regret amendment is not a sign of the greatest strength in these moments. A fatal amendment to end this measure for our farmers is a sign that we have their backs and will go down fighting for them. To do anything else is to sell them short. I ask all Members of the House to support farmers who have been hit by these cruel cuts again and again. We urge them to stand with the Liberal Democrats and reject these regulations. Therefore, in the light of what we have heard, I wish to test the opinion of the House.
Thames Water: Bids
Baroness Hayman of Ullock Excerpts(3 weeks, 5 days ago)
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Lord Sikka
To ask His Majesty’s Government what guarantees they expect to give to, or receive from, any bidder for Thames Water.
The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Baroness Hayman of Ullock) (Lab)
I had almost relaxed then.
My Lords, it would be inappropriate for the Government to comment in detail on a company’s commercial regulations. Ofwat notes that the company has now moved to the next stage in its equity raise process, and it continues to engage with the company to ensure the delivery of the financial and operational turnaround that both customers and the environment deserve. Any investors will be expected to show that Thames Water will meet its statutory and regulatory obligations.
Lord Sikka (Lab)
My Lords, I thank the Minister for her Answer. Let us look at the facts. Thames Water was put on the road to ruin by private equity. Now its shareholders have designated KKR, another private equity group, as their preferred bidder. KKR’s business model is profiteering, high leverage, low investment, asset stripping and high cash extraction. That will inevitably multiply Thames’s problems. The Water Industry Act 1991 gives the Secretary of State powers to vary the licensing conditions. We need to know precisely what the Government will demand from the new owners of a company that already has 187 criminal convictions.
Baroness Hayman of Ullock (Lab)
Regarding the company choosing KKR as its preferred bidder in the ongoing equity raise process, clearly Thames Water is a commercial entity engaged in a public equity raise, and it would therefore be completely inappropriate for the Government to comment on that. However, I note that the company had a number of potential bidders to choose from, which indicates that a market-led solution to the financial resilience of the company is a possibility.
Baroness Grender (LD)
My Lords, does the Minister agree that the Government must protect future bill payers from past mismanagement and a debt that should clearly sit with the vulture funds and bond holders who have in effect asset-stripped Thames Water, leaving it without proper investment and vulnerable to repeated environmental hazards and therefore in strong danger of being in breach of its own statutory duties? Surely the only way to protect those bill payers is by putting it into special administration.
Baroness Hayman of Ullock (Lab)
As I am sure the noble Baroness is aware, a special administration order is the mechanism to ensure that the company continues to operate and customers continue to receive their water and wastewater services. However, the bar for entering special administration is understandably high; the law states that it can be initiated only if the company becomes insolvent, can no longer fulfil its statutory duties or seriously breaches an enforcement order, and Thames Water does not fit those criteria, despite all its other problems. All I can say to the noble Baroness is that we are currently monitoring the situation closely.
Baroness Jones of Moulsecoomb (GP)
My Lords, 90% of England’s water and sewerage services are owned by foreign investors. Can the Minister explain why the Government are so happy for that to happen but not happy to allow us to buy our own vital resources back? It seems madness to allow our vital infrastructure to be owned by foreign states.
Baroness Hayman of Ullock (Lab)
Obviously, water privatisation happened quite a long time ago now, which was when different foreign states came in and invested in our water system. I am sure the noble Baroness is very aware of the work going on through the Cunliffe review at the moment in order to try to get our water companies into a better state. The Government are very keen that we sort out the problem with Thames Water, but that is Ofwat’s and the company’s responsibility at present and we are just watching to ensure that Thames Water does not fail, because we cannot afford to have water companies failing.
Lord Roborough (Con)
My Lords, can the Minister, in light of the depressing state of British Steel, inform the House whether shareholders from any particular geographies would be excluded from investing in or controlling our water industry?
Baroness Hayman of Ullock (Lab)
I am afraid I cannot specifically answer that question. I am very happy to go away and look into it for the noble Lord.
Lord Birt (CB)
My Lords, I wonder whether the Minister saw the very shocking two-part documentary series on BBC Two about Thames Water, which was made in conjunction with the Open University. If she has seen it, does she agree that the dire position we face on sewage spills is at least to some extent down to severe regulatory failure, the regulator’s focus on the price charged for water and the apparent complete failure to insist on the massive investment needed to upgrade our water and sewerage infrastructure?
Baroness Hayman of Ullock (Lab)
I did watch the programmes. I think the straightforward answer to this is that that is why we have Sir Jon Cunliffe carrying out the review, which will look very carefully at the way the water industry has been regulated. One of the things that came across from that programme was the argument that it had been carrying out what Ofwat had asked it to do, which was keep prices low, and because of that there was not sufficient investment. We can look at that in more detail and I am sure that different water companies have interpreted rules from Ofwat in different ways. But the important thing is that we now look very carefully at regulation to make sure that in future it is fit for purpose and we do not end up in situations like we are in at the moment.
Lord Grocott (Lab)
My Lords, the Minister has reminded us that privatisation of the water industry was quite some time ago. I wonder whether she could dig into the archives to check exactly how much was received by the Exchequer at the time of privatisation and, by way of comparison, find a figure for the total amount of profits made by these companies since privatisation.
Baroness Hayman of Ullock (Lab)
I would be more than happy to dig in the archives.
Lord Teverson (LD)
My Lords, is it not time that Ofwat was put out of its misery?
Baroness Hayman of Ullock (Lab)
I shall feed that back to the commission.
Baroness Altmann (Non-Afl)
My Lords, the water industry serves a public good and putting it into private ownership needs very careful handling. It seems to me that Governments over successive years have not paid sufficient attention to the financial dealings that were going on, extracting dividends, not just profits, from these companies. In addition, the companies know that the regulator is not sufficiently resourced to check sewage discharges, for example. I know the Minister is very concerned about that herself. Can she give some reassurance to the House that any new owner of Thames Water would inject sufficient equity capital into the structure and not just debt and would be charged with investing sufficiently and being monitored sufficiently to make sure that past practices are not repeated?
Baroness Hayman of Ullock (Lab)
Clearly, as I have mentioned, this is a private company and it is the company’s decision around this, so the Government cannot comment too much on what is happening. But in order to resolve the situation we have come into regarding sewage spills and the quality of our lakes and rivers, we need to ensure sufficient investment. I would very much hope that any company coming into our water industry would come with the intention to make that investment. After all, the price increases we have allowed water companies to make to their bills through the PR24 is on the understanding that that investment will take place.
Lord Dubs (Lab)
How many of the countries in western Europe and how many of the states in north America have privately owned water, and how many have water in the public sector? Is there not a conclusion to be drawn from what the Minister will now tell us?
Baroness Hayman of Ullock (Lab)
There are a number that are government owned and a number that are privately owned. When you look at the quality of water, you see that it does not matter whether they are privately owned or owned by a Government; it is how it is managed that makes the big difference.
Farming: 25-year Road Map
Baroness Hayman of Ullock Excerpts(3 weeks, 5 days ago)
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Baroness Ritchie of Downpatrick
To ask His Majesty’s Government what plans they have to publish the 25-year farming roadmap, announced in November 2024.
The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Baroness Hayman of Ullock) (Lab)
My Lords, the Government are planning to publish the first iteration of the farming road map, on growing England’s future, later this year. The Government are working together with farmers to develop the road map and set the course of farming for the next 25 years. The ultimate aim is to maintain food production, meet our environmental outcomes, and deliver a thriving and profitable farming sector.
Baroness Ritchie of Downpatrick (Lab)
My Lords, I thank my noble friend for the confirmation that the road map will be published later this year. Generally, what will the timeline for implementation be? Specifically, will it take forward recommendation 12 of the Corry review, which made it clear that we must
“reform slurry application and storage to help address diffuse water pollution from agricultural sources”,
implementing
“a single set of regulations which farmers can understand and comply with”?
Baroness Hayman of Ullock (Lab)
My Lords, as I said, the first iteration will be published later this year. As we are still in the process of determining the content of the road map, and therefore the timetable of implementation, I am unable to give a detailed answer to my noble friend. We will publish more details in due course. I can assure her that we are continuing with targeted engagement right across the sector in order that we can agree a collective vision and shape the first version of the farming road map through discussion with stakeholders.
Baroness McIntosh of Pickering (Con)
My Lords, does the Minister share my concern at the loss of farmland, to the tune of 10%, through the proposed clean energy projects? Will she ensure that the road map rolls back this land grab and ensures that all grade 1, 2 and 3 farmland—the most productive land—will remain in farm production, putting food security and self-sufficiency at the heart of the road map?
Baroness Hayman of Ullock (Lab)
I assure the noble Baroness that food production and self-sufficiency will be at the heart of the road map as it is developed. We work very closely with DESNZ around where energy projects are sited. With the land use framework also being developed, there is a lot of discussion about the best use of farmland, because we do not want good agricultural land taken out of food production.
Lord Teverson (LD)
My Lords, in order to meet the combined objectives of food security and nature recovery, we need a much more nature-friendly form of farming. However, to make that transition, it is absolutely essential that we have a much firmer policy framework that people in farming can predict. When will the sustainable farming initiative be reinstated? Beyond that, can the Minister say that there will be an end to the stop-start funding that is so difficult for farmers when it comes to their own planning?
Baroness Hayman of Ullock (Lab)
One of the challenges that has faced farming for many years is the lack of long-term security. The noble Lord is absolutely right to raise that. We are currently discussing the next stages of the SFI, so I do not have information about the dates at the moment. We will of course announce that when we have more information. We want to make sure that the next iteration of the SFI is fit for purpose and will deliver what we need the farming sector to deliver. On the noble Lord’s questions on nature and the environment, it is absolutely imperative that we get this right. We have to ensure that food production and support for nature and biodiversity work together, hand-in-hand, to create the long-term environment that we need for our country.
Lord Carrington (CB)
My Lords, I declare my farming interests in Buckinghamshire and Lincolnshire. I welcome the road map, but can the Minister confirm that fruit and vegetable growers will be very much part of this review? The removal of the fruit and vegetable aid scheme has caused considerable distress among those growers, and the fact that the scheme still exists in Scotland means that our fruit and vegetable growers are no longer competing on a level playing field.
Baroness Hayman of Ullock (Lab)
We are very keen to ensure that horticulture remains at the heart of any future farming plans. If we are to have a thriving food sector and become more sustainable, fruit and vegetables will clearly be critical to that, as currently we import so much of them. Obviously, I cannot say what will be included in the road map, but horticulture is at the heart of our discussions.
Lord Berkeley (Lab)
My Lords, can my noble friend explain why it is called a road map? Is it going to include all those new roads that I hope the Government are not going to build over farmland? Can we not have a better name for it?
Baroness Hayman of Ullock (Lab)
I suggest that we have answers on a postcard.
Lord Roborough (Con)
I refer the House to my entry on the register of interests as a farmer. Part of the new deal for farmers, published in January by the Secretary of State, was to diversify income streams for farmers. The Planning and Infrastructure Bill, as drafted, will divert nature restoration levies away from farmers to Natural England. Can the Minister explain to your Lordships’ House why this should not be taken as a reduction in diversification opportunities for farmers?
Baroness Hayman of Ullock (Lab)
As I said, food production, diversification and improvements in the environment are the three central pillars of the road map that we are developing—we are extremely keen to ensure that diversification is part of it. One problem that many farmers have faced in the past is not being able to get through the planning applications that are so critical to diversification. Again, that is something that we are looking at as part of our reform of the planning system.
Lord West of Spithead (Lab)
My Lords, my noble friend the Minister will be aware that over 60% of the food we have here comes over the water to this country. Bearing in mind that we are about to have a national security strategy and a strategic defence review, can she confirm that Defra has been very involved with putting into this review the fact that we are an island nation and so need to ensure that we have security of the water over which all of this food passes?
Baroness Hayman of Ullock (Lab)
Food security is not just about what we grow in this country; it is also about what we import. We can never grow everything that we need, so having security of the waters is critical. I am certain that the noble Lord would support any work that Defra is doing to ensure that we have that security. Border Force does a lot of work as well, which is critical.
Lord Garnier (Con)
My Lords, can we not get too bound up about a 25-year road map, whatever it is called? What we are worried about is a 25-month road map. The farming sector is under great strain as a direct consequence of what the Chancellor of the Exchequer announced quite recently. How many farm holdings does the Minister think there will be in 25 months as a direct consequence of what the Government are doing, and what effect will that have upon the rural, and therefore the national, economy?
Baroness Hayman of Ullock (Lab)
I am aware that there are a lot of concerns around some of the recent decisions regarding funding and farming. However, one reason this has been quite difficult is that farming has been facing a lot of challenges for many years now. There has been far too little security for farmers and far too little decent payment to farmers for the goods that they have been producing. The point of the farming road map is to provide some long-term security for the first time in many years.
Lord Trees (CB)
I want to press the Minister on the land use framework and when we might see that. It will be essential to ensuring that we have a coherent and strategic plan for how we use all the land in the limited area that we have in the United Kingdom.
Baroness Hayman of Ullock (Lab)
The land use framework will be critical in a lot of areas. Because we have only a limited amount of land, we have to ensure that we are using it in the best interests of the country, whether that is for supporting farmers and food production, for energy production or for housing and so on. It is important that we are bringing that together. I do not have a date for the noble Lord today, but I assure him that we are actively progressing the report.
Lord Swire (Con)
Self-evidently there will be no food security without food, and there will be no food without farmers. What are the Government going to do about the ageing population of farmers and to encourage younger people into farming, at a time when the farming sector has been so horribly undermined by the Government’s own legislation?
Baroness Hayman of Ullock (Lab)
The average age of farmers has been a problem for many years; there has not been succession planning in the way that perhaps there has for other businesses, because of the nature of farming. We are working closely with the Department for Education on skills. Young people can be encouraged to show an interest from an early age through going to agricultural college, for example, and all these things help. We need to look at how young people can get the right skills to want to go into farming in the first place. It is important that farms are available for new entrants, and that is something that we need to be working on—too many county farms were sold, for example. There is quite a lot of work to be done in this area.
Ancient Trees: Protections
Baroness Hayman of Ullock Excerpts(1 month ago)
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Baroness Tyler of Enfield
To ask His Majesty’s Government, following the recent felling of an oak tree in Enfield, what assessment they have made of the adequacy of protections in place to prevent the felling of ancient trees of national significance.
The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Baroness Hayman of Ullock) (Lab)
My Lords, ancient and veteran trees are recognised as irreplaceable habitats and protected in national planning policies. Local authorities may place tree preservation orders—TPOs—that prevent trees from being felled or significantly modified. We understand that there was no TPO on the Enfield oak tree prior to its felling. One is now in place on what remains of the tree. We are considering the recommendations of a recent report that focused on improving the protection and stewardship of important trees.
Baroness Tyler of Enfield (LD)
My Lords, how can a much-loved 500 year-old oak tree at Whitewebbs Park in Enfield, which I know well, be felled at one stroke—as the Times newspaper put it—leading to a public outcry, when it comes less than two years after the felling of the Sycamore Gap tree? Does this not show that current legal protections, even for nationally significant trees, are totally inadequate? The Woodland Trust has described them as a “gaping void”. What specific steps are the Government taking to ensure that this outrage will never happen again? Does the Minister agree with me that a national list of heritage trees that would have intrinsic protection, akin to ancient monuments and listed buildings, would be a very good thing to introduce?
Baroness Hayman of Ullock (Lab)
Clearly, many people were shocked by the felling of this tree, coming on the back of what happened to the tree at Sycamore Gap. To someone who, like the noble Lord opposite, lives in Cumbria, it was really horrifying. It has opened up a nerve in the country about how important it is that our ancient trees are properly protected. At the moment, the Government are looking at the recommendations of a report from the Tree Council and Forest Research regarding measures that are needed to improve protections for ancient, veteran and culturally important trees. We are not in a position to outline what we are actually going to do, because we are in the process of going through those recommendations, but we are aware that there are great concerns.
Lord Blencathra (Con)
My Lords, this was an unfortunate incident, but it seems there was no malintent: no one cut down a protected tree to expand a car park or a building. If there is a villain, I suspect it is the usual overreaction to health and safety concerns: someone reported that the tree was a risk and someone in the pub chain decided that they had better deal with it; then the contractor cut off excessive branches, leaving this bare stump. It is a catalogue of genuine mistakes and I note the profuse apology of the chief executive of the pub chain.
However, if the tree was on the Woodland Trust’s ancient tree inventory as a nationally significant pedunculate oak, why did Enfield Council not have a tree preservation order on it beforehand and why were the pub owners not informed of its significance? I was going to ask the noble Baroness what steps the Government will now take to strengthen the enforcement of existing provisions for ancient trees of national significance. I and the whole House look forward to getting the report from Defra as soon as possible on new steps to protect trees like this in the future.
Baroness Hayman of Ullock (Lab)
The noble Lord makes some good points. The issue here is that Toby Carvery said that the tree needed to be felled because it was already dead and posed health and safety concerns. The matter was then referred to the police by Enfield Council, which was clearly concerned by what had happened, and to the Forestry Commission. The Metropolitan Police closed its inquiry because it said it was a civil matter; because of that, the Forestry Commission is now carrying out the investigation into exactly what happened and whether the tree was dead or not. It looks like a very heavily pollarded tree at the moment; the question of whether it is dead is for us to consider further.
Baroness McIntosh of Hudnall (Lab)
My Lords, like the noble Baroness, Lady Tyler, I know this tree; it is quite near to where I live. As was pointed out by the noble Lord, Lord Blencathra, there appears to have been no criminality or even any serious criminal intent in this case, because there was a failure to understand the significance of this tree. So in what way can those significances be better publicised and made clear to people? Perhaps more importantly, given that trees are sometimes wrongly felled as part of an intention to clear a site—for a development, for example, when the sanctions are often regarded as a cost of doing business—are the sanctions against people who wilfully damage trees that are or should be protected strong enough to act as a deterrent?
Baroness Hayman of Ullock (Lab)
My noble friend makes some extremely good points. The new National Planning Policy Framework recognises ancient and veteran trees as irreplaceable habitats and makes it clear that any planning decisions should not result in their deterioration or loss, so it is good that we now have that in the NPPF. As I mentioned earlier, we are considering the report by the Tree Council in order to look at how we can improve protections for such trees, and I am sure that sanctions will be part of what we are considering. Ancient trees—because you cannot just plant another tree and recreate that habitat—need special attention.
Baroness Walmsley (LD)
My Lords, as the Minister has just said, ancient trees not only lock up massive amounts of carbon for decades or even centuries but provide an amazing, biodiverse habitat for wildlife. While we encourage planting new trees, it takes a long time for them to lock up anything like the same amount of carbon. So what are the Government doing to encourage landowners to identify massive ancient trees and perhaps apply for tree preservation orders or something of that nature?
Baroness Hayman of Ullock (Lab)
Defra has just been mapping trees in this country, so that we have a better understanding of how many trees we have, where they are and what types of trees they are, so we are doing quite a lot of work to understand what trees we have. Also, as I am sure the noble Baroness and other noble Lords are aware, when applying for what was BPS and is now ELMS, the mapping of particularly important large trees on farmland is currently carried out. When we look at the Tree Council report, we need to consider how we can use that information to make sure that the most important trees are protected and that landowners are encouraged to do so.
Lord Kamall (Con)
My Lords, I hope the noble Baroness takes this question in the spirit in which it is intended. Given that the tree has now been felled, what is the point of a tree preservation order on the stump? Is it to act as a disincentive to future fellings or to send a strong signal to make more people aware that they should be more careful when felling older trees?
Baroness Hayman of Ullock (Lab)
That is a really good question. I do not know the reason why the council has put a TPO on it, but common sense suggests that the tree may not actually be dead. You could say that it has been extremely heavily pollarded, as opposed to chopped down at the base, as was the case with the Sycamore Gap tree. On that basis, it could potentially sprout again. It will not exactly recover quickly to its former glory, but that is potentially the reason that the TPO has been put on it.
Lord Cromwell (CB)
My Lords, can the Minister tell the House whether TPOs are easy to find online through digital mapping? That would remove the excuse for cutting down a tree with a TPO; it would also give people in the local community the opportunity to identify trees that perhaps do not have TPOs but they feel should, as part of the local plan.
Baroness Hayman of Ullock (Lab)
The noble Lord asks an interesting question, to which I do not actually know the answer. I shall look into it and get back to him.
Earl Russell (LD)
My Lords, our ancient trees are an extremely important part of our national psyche and extremely important for our biodiversity. I welcome the Minister’s comments that the Government are looking at what more they can do to protect our ancient trees, but can I press her further? When do the Government feel they might bring forward legislation in this area? Would the Planning and Infrastructure Bill be such an opportunity?
Baroness Hayman of Ullock (Lab)
The noble Lord made a number of points there, on planning infra- structure, nature, biodiversity and a wider tree strategy. Defra and MHCLG have been talking extensively about environment and planning, and doing a lot of work on that ahead of any legislation in that area. Regarding nature and biodiversity, we are having a number of conversations in Defra on our priority legislation going forward. Clearly, these areas will be part of those discussions.
Farming and Rural Communities
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The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Baroness Hayman of Ullock) (Lab)
My Lords, I congratulate the noble Lord, Lord Roborough, on securing this debate and all noble Lords who have taken part. The debate has covered a wide range of topics and there has been a large number of questions. I will do my best to answer them, but clearly I may well have to write to noble Lords on some areas.
I start by confirming that the Government are committed to improving the quality of life for people right across the country, including those who live and work in rural areas. To achieve this, we must ensure that the needs of people and businesses in our rural areas are at the very heart of our policy-making. We have recently announced our farming new deal. This will support growth in the farming sector and rural communities, and is determined to return farm businesses to profitability.
One of the underlying problems for farmers and the wider rural community is simply that farmers do not make enough money for the hard work and commitment they put in. One of our commitments is to make farming more profitable. That approach is underpinning our 25-year farming road map and our food strategy, through which we will work in partnership with farmers to make farming and food production sustainable and profitable. We have already begun holding farming road map workshops with key stakeholders from across the farming sector, and we plan to publish the road map this summer.
Our support in this for farmers rests on three principles. I thank my noble friend Lord Davies for his support for the farming initiatives we are undertaking. The first principle is our commitment to the sector that has food production at its core. The role of farming will always be to produce the food that feeds our nation. The instability we have seen, both relating to Ukraine and during Covid, shows that food security truly is national security, and we need to move forward in this area.
The noble Baroness, Lady Shephard, particularly mentioned food security and is absolutely right. We need to act to support food production. We are using our own purchasing power as a Government to back British produce, and we have also announced a five-year extension to the seasonal worker route.
A number of noble Lords mentioned trade and new trade agreements. I absolutely understand farmers’ concerns in this area. Supporting farmers in new trade agreements is a priority. We have been clear that we will protect farmers from being undercut by low welfare and low standards in trade deals. We will continue to maintain our existing high standards for animal health and food hygiene. The Government are also committed to developing a trade strategy that will support economic growth and promote the highest standards of food production. On tariffs, I am afraid that at this time I am unable to say anything further than the Business and Trade Secretary’s Statement this morning in the Commons.
Our second principle is that this is a sector in which farm businesses must become more resilient and more able to withstand the shocks that disrupt farming from time to time. That could be severe flooding, drought or disease. We want to help farmers who want to diversify their income to put more money into their businesses in order to survive those more difficult times when they come.
We will give farmers the power to diversify their businesses by speeding up the planning system. In the spring we will consult on how we transform the planning system to ensure that farmers and growers, or their landlords, can build and repurpose buildings on their farms to support their businesses. We will ensure that permitted development rights are working for farmers so that they can speedily convert larger barns into a farm shop, for example, or have the option to set up holiday lets. These changes address long-standing concerns that current planning rules hinder farm businesses from becoming more productive and environmentally friendly.
The third principle is nature. Noble Lords have spoken about this, particularly the noble Lord, Lord Teverson. Restoring nature is vital for food production. We do not believe it is in competition with it. Healthy soils, abundant pollinators and clean water are the foundations that farm businesses rely on to produce high crop yields that actually turn a profit. Without nature thriving, there can be no long-term food security. That is why last year we were pleased to announce £5 billion for the farming budget over 2024-25 and 2025-26. We now have more than half of farmers in environmental schemes supported by this budget.
However, several noble Lords raised concerns about the recent closure of SFI to new applications and the implications of that decision on farmers, nature and the wider rural community. The Government have allocated SFI a budget of £1.05 billion for 2024-25 and 2025-26. That is money that will go into farmers’ pockets and the wider rural community. I know that people have been concerned about the sudden closure of the scheme, but we want to continue to support farmers to transition to more sustainable farming models through a range of schemes and grants. We will announce details of the revised SFI scheme after the spending review.
The noble Earl, Lord Shrewsbury, and the noble Baroness, Lady Shephard, asked further about SFI reform. The noble Baroness asked whether this was a permanent cancellation—absolutely not. We are looking to reform the SFI offer before reopening it following the SR decision. The idea is to introduce more sophisticated budget controls to manage the scheme and ensure that it targets public funds fairly and effectively, as well as where it is most needed—where it will make the biggest difference to nature. We know that uplands need further support, for example.
Several noble Lords raised concerns about the effects of the changes to agricultural property relief on inheritance tax in the context of farming and rural communities. We have debated this at length in the past, so I will now look particularly at the mental health concerns that have been raised. We are aware of the effects of the challenges that the issues of SFI and APR have posed to farmers and others in rural communities. We will continue to provide funding for several organisations that are delivering projects to improve farmer mental health. The Government are giving mental health the same attention and focus as physical health through measures such as employing thousands of new mental health support workers.
On that basis, the noble Lord, Lord Roborough, specifically asked about mental health support in the farming and agricultural community. We have set up a dedicated team to address the particular issues that drive poor mental health outcomes in the farming and agricultural sector. We are working with communities, farming support organisations and experts to look at exactly how we can deliver the best in this area. The Rural Payments Agency also runs a farmer welfare forum.
The Government are aware of the specific challenges and opportunities that make rural and farming communities and economies distinctive. The right reverend Prelate the Bishop of St Albans particularly asked about the economy, as did the noble Lord, Lord Elliott of Ballinamallard. We recognise that rural areas have significant potential for growth and are central to the economy. We recognise that, in order to develop the full potential of rural businesses, we also need to focus on small businesses, which are an important part of our high streets and of the rural economy, with many more people self-employed or working in small businesses. The Government are actively working on that.
The Government have made a commitment that all policy decision-making should be rural-proofed. Obviously, Defra leads on rural-proofing, but individual departments are responsible for ensuring that their policy decision-making is rural-proofed, and we work with them to consider that. We know that a prosperous rural economy requires effective rural transport, decent digital infrastructure, the availability of affordable housing and energy, and access to a healthy and skilled workforce. We are doing our best to work cross-government to tackle these issues.
Rural housing was also discussed, particularly by the noble Baroness, Lady Coffey. We are reforming our planning policy to ensure that we can build the homes that our rural communities desperately need, but at the same time we recognise that we need to protect our green spaces and the natural environment. The Government’s response to last year’s consultation on the National Planning Policy Framework reflected on the higher costs of housing delivery in rural areas and the fact that we want to see more affordable housing as part of our ambition to deliver the biggest increase in social and affordable housing in a generation.
The noble Lord, Lord Best, talked about the work of the Devon Housing Commission and how other evidence on rural housing will be included. The draft housing strategy will be published very soon, so that will be taken into account there. He mentioned the rural housing exception sites. The Government are very supportive of and will encourage work on them. On empty homes, local authorities have the power to tackle empty properties—for example, with an empty homes order. Obviously, we are now working on the Planning and Infrastructure Bill as our next step in the reform programme.
The noble Baroness, Lady McIntosh, raised concerns about the planning Bill’s impact on grade 3 or grade 4 agricultural land, and the loss of farmland to energy projects. The NPPF prioritises using lower-quality land and protecting the best farmland for food production. Large renewable energy projects must ensure that any benefits outweigh any negative impacts on prime agricultural land.
The noble Lord, Lord Grayling, asked about solar energy as well. The figure that I have is that less than 1% of UK agricultural land would be used, even in the most ambitious scenario. I am sure that noble Lords are aware, also, that solar farms can operate alongside farming activities—for example, continued livestock grazing. I shall have to get back to the noble Baroness, Lady McIntosh, about further renewable percentages, as I do not have that figure at the moment.
Noble Lords raised the nature restoration fund and how it will be delivered. We are working closely with Natural England and others to ensure that the appropriate resources are in place to administer it, and it will run on a cost recovery basis. We will recover costs through developer payments, which should unlock development more quickly and provide greater assurance of nature restoration.
The noble Baroness, Lady Coffey, and others talked about Natural England’s role. We would not expect land acquisition to be the first delivery model considered, although clearly it is a possible approach and may well be appropriate in some circumstances. It is important to remember that compulsory purchase is only one tool, and we would expect Natural England to consider using such powers only when attempts to acquire land by agreement has failed, and there is a very compelling case in the public interest.
The noble Lords, Lord Fuller and Lord Teverson, mentioned the Corry review. I urge noble Lords to read it—it came out the day before yesterday. We have begun work on fast-tracking nine out of the 29 recommendations. One is particularly pertinent to the farming sector about rapidly reviewing and reworking regulatory guidance. Farmers currently have to consider and comply with more than 150 pieces of regulation, which we think is unfeasible, so we are looking at that as part of it.
The noble Lord, Lord Roborough, asked about the land use framework. We are consulting on that until 25 April. The idea is that it is not going to tell anybody how to use their land or what to do with it; it is not the intention to use it to make binding decision-making for land or prescribe specific outcomes. It is intended to advise those managing the land and who are preparing local strategies or plans. Clearly, there will be more information on that once it is published.
On health, which was mentioned by the noble Lords, Lord Kakkar, Lord Elliott and Lord Harlech, demographics show that, as they age, people move out of towns and cities to coastal and rural areas, so they are putting the most pressures on the health services at the time when they are going to need most care. The integrated care systems in England should have a specific role to play on that—but I completely understand where noble Lords are coming from, as I live in a very rural area myself. Travel times in Cumbria to healthcare are long and we have poor roads, so it can take an awfully long time. One reason why I am very pleased to be on the Child Poverty Taskforce is because those kinds of aspects of poverty and access to health are a fundamental part of the discussions that we are having.
A number of noble Lords, including the noble Lord, Lord Elliott, and the right reverend Prelate the Bishop of St Albans, mentioned the bus services Bill, which will deliver new powers to local leaders to empower them to choose the model that works best in their area. Clearly, that will include rural services, because buses are vital, and they have been disappearing at far too great a rate in rural areas.
The noble Lord, Lord Roborough, mentioned delinked payments. I declare an interest, because I am in receipt of delinked payments, so I have a very clear understanding of how rapidly they have been going downwards. But we have provided a calculator so that farmers can see the impact that the reductions could have on their 2025 payments.
The noble Lord, Lord Roborough, asked a whether the budget for Weybridge was part of the farming budget. I can confirm that it is separate. The noble Lord, Lord Horam, asked about private investment in tech and innovation. Since 2021, the farming innovation programme has attracted over £54 million in private investment in addition to the £152 million that Defra has committed; it is an important part of what we do.
Tenant farmers were mentioned by the noble Lord, Lord Fuller, and others, and the noble Lord had some very interesting other ideas and thoughts. Defra is working collaboratively with industry representatives to address the challenges faced by tenant farmers, through the Farm Tenancy Forum. The lack of affordable local housing for tenant farmers who want to retire from a tenanted holding has been identified as a key barrier; again, we are looking at that. We have started the recruitment campaign for the commissioner for the tenant farming sector, and that is now live.
The noble Lord, Lord Carrington, asked about research and innovation. As I said, a lot is available if farmers know where to look. We need to figure out how we work with people to make sure that such things are accessible.
The noble Lord, Lord Douglas-Miller, mentioned bovine TB. The Government started work on their new bovine TB eradication strategy to drive down TB rates and end the badger cull by the end of this Parliament. A key part of the strategy is to drive forward the ongoing development of the cattle vaccine. We are working closely with farmers, vets, scientists and conservationists to rapidly strengthen and deploy a range of disease control measures. We are also going to introduce the first badger population survey in over a decade, so that we can have a data-driven approach to inform how and where TB vaccines and other eradication methods are employed. We will also establish a new badger vaccinator field force.
The noble Baroness, Lady McIntosh, asked whether we are helping farmers to support water on farmland. We have committed to a record £2.65 billion floods investment programme, which will deliver on natural flood management; the impact of a project on agricultural land will be included as part of the funding calculator. In addition, we have published a rapid evidence assessment, conducted back in 2024, of flooding and coastal erosion on agricultural land and businesses. That also discusses the evidence for agriculture as a provider of natural flood management.
I am about to run out of time. In conclusion, I have genuinely listened very carefully to noble Lords’ concerns, because I appreciate that there is a lot of concern about funding and support for farming at the moment. It is important to recognise the huge interest and knowledge that this House brings to these discussions. We have had several rural debates in the Chamber and, of course, in the other place. I have also heard separately from many Members who are concerned about the issues faced by the rural areas they live in or have previously represented. I will take those concerns back to the department. The Farming Minister, Daniel Zeichner, is also very cognisant of all this.
I have run out of time, so I wish the House a very restful break and a happy Easter—
Lord Bilimoria (CB)
Before the Minister sits down, I asked several questions and raised many points—not one has been answered. I would be grateful if she put a Written Answer in the Library.
Baroness Hayman of Ullock (Lab)
I did say, right at the beginning, that I would not be able to get to everything within the time and that I would write concerning questions that had not been answered.
UK Fishers: EU Agreement
Baroness Hayman of Ullock Excerpts(1 month, 3 weeks ago)
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Lord Roborough
To ask His Majesty’s Government what plans they have to improve outcomes for UK fishers after the current agreement with the European Union expires.
The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Baroness Hayman of Ullock) (Lab)
My Lords, after the end of the fisheries adjustment period set out in the trade and co-operation agreement, European Union access to UK waters, and vice versa, become a matter for annual renegotiation, as is typical between coastal states. We know that the EU wants a new multiannual access agreement. We will listen to what it has to say and will work tirelessly to achieve the best possible outcome for the UK economy and coastal communities.
Lord Roborough (Con)
My Lords, there have been alarming reports in the press that our European friends seem intent on securing and even improving their access to our exclusive economic zone fisheries ahead of any negotiation of other issues. Can the Minister confirm that this Government will not only defend but substantially increase the quota position of our fishermen in our waters ahead of the 26 June deadline?
Baroness Hayman of Ullock (Lab)
Clearly, as a Government, we will always push for the best opportunities for our fishers and the fishery industry. We would like to see long-term strategies to provide the industry with greater stability, which is important to it. At the same time, it is important that we always follow scientific advice when developing negotiations and catch limits.
Baroness Grender (LD)
My Lords, is the Minister aware that, last week in the other place, the Conservative shadow Environment Minister admitted that the previous Government’s negotiations failed our fisheries? Does she agree that a rollover of the current system will fail them again? Can she tell the House what consideration the Government are giving to proposals from the Liberal Democrats to roll out a multiyear quota system that would help the industry to plan for the future and stop the current cliff edge?
Baroness Hayman of Ullock (Lab)
As I just mentioned, we need long-term strategies to give greater stability to the fishing sector. We are also very keen that we develop our policy in this area by working with the industry and talking to fishers and their representatives, so that they have direct input into how we move forward and that we understand, from their perspective, how best we can support them.
Lord Ricketts (CB)
My Lords, given the overriding importance of reaching an early agreement with the EU on defence and security, does the Minister agree that the right way to handle the issue of fisheries with the EU at this stage is to use the 19 May EU-UK summit to agree to a joint commitment to find a mutually agreeable solution on fisheries within a particular time well ahead of the 26 June deadline?
Baroness Hayman of Ullock (Lab)
As I made quite clear, we intend to negotiate with the EU in the best interests of the fishing industry and to protect our fishing communities. However, due to the nature of the current negotiations regarding the EU reset, I am not in a position to give any further information about what we discussed at those meetings.
Baroness McIntosh of Pickering (Con)
Does the Minister share my concern that fishers have lost 10% of their grounds through energy use, particularly through the Great British Energy Bill? How does she intend to address this spatial squeeze and ensure that the fisheries’ grounds loss is not permanent but will be compensated?
Baroness Hayman of Ullock (Lab)
I am sure the noble Baroness is aware—because we have talked about it in relation to other issues with Defra—that we are working closely with other departments in this area, including DESNZ, to address exactly the kinds of issues she raises. I will go back to the department and talk to my colleague the Fisheries Minister, Daniel Zeichner, specifically about the point that she just raised.
Baroness Jones of Moulsecoomb (GP)
My Lords, I am sure the Minister knows that we have French and Danish fishing fleets not only fishing in our waters, as per the agreement, but bottom trawling in our marine protected areas. Are the Government going to start protecting those marine protected areas, or shall we call them something else?
Baroness Hayman of Ullock (Lab)
The Government are looking with different groups and industry to increase protections across MPAs and at the best way to move that forward. Around 100 of our MPAs have by-laws which are in place to protect designated species and habitats from fishing gear that we know is damaging, including bottom trawling. As I have said before, we are looking at how we can move forward in this area.
Lord Mountevans (CB)
My Lords, the Fisheries Minister is looking at better matching the fish we catch in UK waters with what we eat as a nation. Given that the Government spend more than £5 billion on food procurement, can the Minister confirm that they are doing everything possible to support UK fishers and farmers in their procurement?
Baroness Hayman of Ullock (Lab)
We have said before in the House that we intend to hugely increase local procurement of food by government departments, hospitals, prisons, schools and so on. Clearly, fish is part of that, as is locally produced food from our farms. We are very keen to move that forward at pace and are currently looking at how best to do that.
Lord Anderson of Swansea (Lab)
My Lords, given the urgency and general importance of an agreement on security, has this in any way been made dependent on an agreement on fisheries?
Lord Hannay of Chiswick (CB)
My Lords, will the Minister confirm that, following the trade and co-operation agreement, the Government will enter into post-2026 fisheries issues at the time laid down for that and not at any artificial date, and that they will negotiate in good faith and in good time on that timetable and not on any artificial proposal to advance that date?
Baroness Hayman of Ullock (Lab)
We will always negotiate in good faith. Regarding any new negotiations, we do not have any talks with the EU currently scheduled. We are content with the existing agreement and with the full and faithful implementation of the TCA post-2026 fisheries access arrangements. However, we will of course listen to the EU and the industry, and we intend to continue to protect the interests of UK fishers.
Lord Geddes (Con)
Can the Minister comment on recent reports that our fishers are using heavier ropes to avoid snagging mammals, whales, dolphins and creatures of that ilk?
Baroness Hayman of Ullock (Lab)
I am not aware of any such reports. If the noble Lord would like to share them, I would be very happy to see them. Regarding mammals being caught, we are proceeding with electronic monitoring to get better data. The reports that come in are probably only the tip of the iceberg of the number of mammals that are affected.
Baroness Hoey (Non-Afl)
My Lords, sadly, the fishing industry and fishing men and women felt very sold out by the last Government. Will His Majesty’s Government now commit to always putting the needs and aspirations of British fishermen and fisherwomen above and beyond those of French fishermen and fisherwomen?
Baroness Hayman of Ullock (Lab)
As I previously said, we will be very robust in any negotiations and discussions. It is important that we support our fishing industry and get the best outcomes that we possibly can.
Lord Grocott (Lab)
My Lords, is not it important, amid all the intricacies of any discussions that are going on, to remember that we are a sovereign state with our own territorial waters for which we are responsible, and that that is an infinitely better position to be in than when we were members of the common fisheries policy?
Lord Kerr of Kinlochard (CB)
Have the Government consulted inshore fishermen, particularly Scottish inshore fishermen, whose interest is rapid access to continental markets for their high-value product, and who were so badly frosted by the previous Administration?
Baroness Hayman of Ullock (Lab)
The difficulty with negotiating for fisheries in the UK is that it is such a diverse industry. For example, fishers in Scotland will have very different needs from fishers in Cornwall—from those who may be catching crabs and lobsters to those who are after cod and pollock. It is a very complex area. The outcomes report on sustainability of fishing stocks, for example, is an extremely complex read—if anybody fancies it, I can provide them with a copy. But I completely take the noble Lord’s point, which is why we are very keen to work with industry to properly understand what it would like to see in the future.
Lord West of Spithead (Lab)
Does my noble friend the Minister believe that we have sufficient ships looking after our territorial seas and our exclusive economic zone—fishery and the things on the seabed—or does she believe, looking at the SDR, that we should get an increase?
Baroness Hayman of Ullock (Lab)
I am not certain that we would ever have enough ships for my noble friend to be satisfied.
Sustainable Farming Incentive
Baroness Hayman of Ullock Excerpts(2 months ago)
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Baroness Grender (LD)
My Lords, I thank the Government for the Statement. They will no doubt by now be aware of the significant disappointment and dismay the sudden closure of this scheme, without consultation or warning, has caused. What analysis did the Government do before this announcement to establish the likely impact on smaller farmers such as family farmers and those on significantly less than the minimum wage? Were there impact assessments in respect of farmers losing their basic payment this year with the immediate removal of SFI, and without, as yet, any clear replacement scheme?
Can the Minister please share with us the expenditure implications? It is our understanding on these Benches that if the BPS cuts this year are taken into account, more than £400 million of the £2.5 billion farming budget will remain unspent. Given that this was a budget intended to reward farmers for nature restoration and sustainable food production, can the Minister reassure us that this will not damage both? Can she explain how the Government will ensure that key environmental work is rewarded, and carried out by farmers who can no longer get access to this funding?
Does the Minister accept that there is a danger that the larger landowners, the ones that are more corporate, are highly likely to have already taken up the SFI and be part of the 6,100 new entrants this year? What advice does she have for the smaller operators, some of Britain’s poorest farmers, who are now left behind? Is she further aware that only 40 hill farms were new entrants this year, and that the previous Government failed to provide sufficient support for hill farmers, which in turn led to an over 40% drop in hill farm incomes in just five years? Is there any plan to help the small farms, upland farmers and commoners affected by this sudden change?
Can the Minister share with the House any discussions with farming stakeholders in advance of this change? Stakeholders tell us there were none, and the NFU said that it had just 30 minutes’ notice.
Finally, will the Minister please share what steps the Government will now take to increase the farming budget to reflect the Government’s nature and climate targets? We would be very happy to share the suggestions in our own manifesto if that would be in any way helpful. These targets, we would argue, have been greatly damaged by this cut in SFI.
The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Baroness Hayman of Ullock) (Lab)
My Lords, I thank noble Lords for their interest and questions on the Statement.
Twice before, the SFI system has been paused when the funding had been used up from the applications and started up again. Although applications for the SFI 2024 scheme have closed, I want to reassure noble Lords that we plan to reopen the SFI application service once we have a reformed SFI offer in place. Ongoing ELM schemes are supporting farm businesses to remain viable as they adjust to the reduction of farm subsidies that noble Lords have referred to. The new figures published recently showed that the proportion of commercial farms with income from agri-environment schemes rose from 49% in 2021 to 70% in 2023-24. There is a success rate here.
The noble Lord, Lord Roborough, asked about funding from the delinked payments reductions. The money released from the reductions to subsidies is being reinvested through our other schemes for farmers and land managers. Every penny is staying within the sector.
Details of how the £5 billion for 2024-25 and 2025-26, which was secured in the last spending review as being spent, were published on our farming blog on 12 March, for noble Lords who are interested. This includes £1.05 billion on SFI and £350 million on other ELM schemes.
The noble Lord asked about the Countryside Stewardship higher tier. That is being rolled out in a controlled way by invitation, so that everyone will get the right level of support. Invited applicants will be asked to submit applications from this summer.
On the environment and environmental targets, which the noble Lords asked about, closing SFI for new applications will not have any impact on the environmental benefits that we are getting from the 37,000 SFI agreements that are already live, nor affect the outcomes we are getting from other agri-environment schemes. The Government are still committed to delivering on these environmental outcomes.
Some 4.3 million hectares of land are now in SFI agreements, which means that 800,000 hectares of arable land are being farmed without insecticides. We want to move further on this. This reduces harm to pollinators and improves soil health. Some 300,000 hectares of low-input grassland is being managed sustainably, which will help biodiversity and improve water quality. Some 75,000 kilometres of hedgerows are being protected and restored, and this provides essential habitats for wildlife, improves carbon storage and strengthens our natural flood defences.
Regarding the timing of the reformed SFI, we plan to reopen the online application process once we have finalised the offer. On the issue around small farms, upland farmers and commoners, we need to make it fit for purpose as it moves forward, so that we are talking to the right people and allowing the right kind of farms and communities to apply. We are considering what it needs to look like, taking those issues into consideration. Clearly, the spending review is also important. We expect to publish more information as to what it will look like and when it will come into play after that. We will work with stakeholders and farmers to review the scheme, to ensure that we are directing funding towards the actions that are most appropriate and have the strongest case for that investment.
We also want to align the SFI with our work on the land use framework and the 25-year farming road map that my colleague, the Farming Minister, is working on. We need to protect the most productive land and boost food security while we deliver for the environment and nature.
We are evolving the SFI offer and exploring ways to better target the money towards smaller farmers and the least productive land. We need to ensure that we get the outcomes that we need.
To confirm, the farming budget remains at £5 billion for this year and next year, as we previously announced. We are on track to spend all the funding that is available.
On private sector funding, which the noble Lord, Lord Roborough, asked about, the Government are committed to significantly increasing private investment in nature’s recovery. This will not only help us meet our environmental targets but will create opportunities for farmers and land managers to diversify their business revenues through the sale of services around nature and the environment. Those markets are small, but they are growing. We are going to consult on what additional action we need to take to strengthen those markets in the weeks ahead. In the recent land use framework publication, we announced a call for evidence to seek views on how we can better incentivise private investment in nature from the sectors that impact and depend on our shared natural capital. We intend to publish that later this year.
The noble Lord, Lord Roborough, asked specifically about the Woodland Carbon Code and the Peatland Code. The Government have launched a consultation on integrating greenhouse gas removals in the UK Emissions Trading Scheme—as the noble Lord knows, that was last summer. This included exploring the inclusion of the Woodland Carbon Code in the UK Emissions Trading Scheme. We are going to look at that consultation and respond in due course.
We are also exploring opportunities for expanding private investment in woodland creation. A few weeks ago, we launched the timber in construction road map, and we have an upcoming call for evidence on private investment for nature recovery. We also recently launched a tender to modernise the Woodland Carbon Code’s operations and the upcoming voluntary carbon and nature markets consultation, so there is quite a lot going on in that area.
On the water industry, we are aware of a number of water companies that are working to develop nature-based solutions and exploring actions to improve water quality and manage flooding. We are working with the industry to understand how we can promote the different benefits that come from this and to promote blended funding approaches. Through Ofwat, the Government are also supporting water companies to develop nature-based solutions—we have discussed this in other debates. It is an important focus for us. Mainstreaming nature-based solutions to deliver greater value is something we now have a grant to look at, so we can bring together multi- sectoral expertise and leadership, which is what we are going to need to facilitate and enable the proper, true transition to nature-based solutions.
I hope I have covered most things, but I will check and get back to noble Lords if I have not.
Baroness Hayman of Ullock (Lab)
As I mentioned earlier, this is not the first time that SFI has been paused. The way the scheme operates is that it opens for applications and, when the funding is used up, it is then paused until we look at the next round of SFI funding. It is difficult to judge when that is likely to come to an end. In response to the noble Lord’s final question, we are aware that the SFI scheme needs reforming, which is what we are now looking at doing. We need to get it right and we need it to work better for farmers and for the environment. That is why, as I mentioned, we will be talking to stakeholders, including those who use the scheme and those who we would like to use it but who perhaps find it difficult to apply to at the moment. I am particularly talking about smaller farms and upland farms; we need to be much more targeted on them. We are aware that we need to reform it, and we are working on that at the moment.
The Earl of Leicester (Con)
My Lords, I refer the House to my register of interests. It is somewhat disingenuous of the Minister to say that the SFI scheme has been paused twice. The previous two occasions were actually pilot schemes, which were then rolled forward, so I do not accept that. Following on from the question from the noble Lord, Lord Cromwell, what assessment has been made of whether Defra has sufficient resources and staff to deliver commitments across the environment and food security, and what is the Minister’s assessment of the Rural Payments Agency’s ability to handle the change?
Baroness Hayman of Ullock (Lab)
As I said, we need to reform the system and we are working on that; we want it to work as effectively as it possibly can, both to support farmers and to deliver the environmental targets that we need. I have visited the RPA offices in Carlisle, and the staff there work incredibly hard. We are looking at how we can improve the digital support they get, for example, because we need to ensure that the RPA is fit for the future and able to support farmers as best as it can in the way that it needs to.
Baroness Ritchie of Downpatrick (Lab)
My Lords, I thank my noble friend the Minister for her Statement today. On the sustainable farming incentive, I know that she visits Northern Ireland and the other devolved nations fairly regularly, examining agricultural and environmental issues. When she next visits Northern Ireland, could she discuss with the Minister for Agriculture there the impact of the withdrawal of APR and business property relief? They were essential to sustainable farming in Northern Ireland, where an acre sells for about £25,000. The level of investment and money needs to be investigated by the Government and the Treasury again.
Baroness Hayman of Ullock (Lab)
I thank my noble friend for those questions. The last time I visited Northern Ireland, I went on a visit with the Ulster Farmers’ Union to a farm to look at the specific differences between farming in Northern Ireland and in England, and to listen carefully to their concerns about some of the issues that my noble friend has raised. I can confirm that I am going to Northern Ireland on Thursday. I will be spending two days there, and I have already asked for an agenda item with Minister Muir, who my noble friend referred to, to discuss exactly these issues. It is really important that Northern Ireland farmers are listened to, just as it is important for farmers in the rest of the UK.
The Lord Bishop of Manchester
My Lords, I do not know whether I have an interest to declare. I am not a farmer but the Church Commissioners, who pay my stipend and working costs, are one of the largest landowners of tenanted farms in the UK, so I declare that.
We have had a couple of brief references so far to food security, but might I tempt the Minister to say a little bit more on that subject, particularly given the geopolitical situation we are in at the moment? In addition, has any assessment been made of the impact that these changes and the announcement last week are likely to have on the UK’s food security?
Baroness Hayman of Ullock (Lab)
On food security, as I mentioned earlier, we currently have 37,000 farmers in the SFI scheme, which equates to about 50% of farmland. The purpose of that is to support them to produce food sustainably while also delivering for nature. The SFI agreements last for three years, so, although we have closed the new applications, the live agreements—the 37,000—remain unaffected and can continue to support sustainable food production.
We are committed to improving food security and are aware that SFI is a major tool that we need to use to support that. We are also looking to boost food security with other tangible measures. For example, we recently committed to ensure wherever possible that half of food supplied into the public sector is produced locally or certified to high environmental standards. We have also announced a five-year extension to the seasonal workers visa route and we are looking at reform to the planning system so that farmers can put the necessary infrastructure in place that they need in order to continue to produce food sustainably.
Lord Bellingham (Con)
My Lords, further to the question from the noble Lord, Lord Cromwell, is the Minister aware that, speaking in the House of Commons before the election, the then shadow Defra Minister, Danny Zeichner, said that farmers in the UK needed complete certainty and stability on the SFI? He went on to say that an incoming Labour Government would provide exactly that. Is this the Minister’s idea of complete certainty and stability?
Baroness Hayman of Ullock (Lab)
I completely understand that the closure so quickly and unexpectedly has caused difficulties and concern—I just want to say that. However, it is important that, looking to the 25-year farming road map that we are developing, part of the reasoning behind that is to try to give that kind of security. It is also important that, when we look at opening the SFI scheme next time, all this is taken into consideration, so that our reforms produce a more stable scheme. He is absolutely right that farmers need certainty and security, because farming is looking at long-term investments and farmers need to be able to know how to make those investments. So I take his point.
Lord Carrington (CB)
My Lords, I declare my farming interests are set out in the register and that I am likely to be affected by the withdrawal of SFI 24. I want to just probe a little further on the two questions that were asked by the noble Lord, Lord Cromwell, and the noble Earl, Lord Leicester. The Government claim that the promised six-week warning of closure was not given due to the potential spike in applications causing budget overspend. Surely, Defra has been monitoring this spending versus budget and advising Ministers accordingly. Please can the Minister confirm that she is satisfied with the efficacy of the Defra review process and, if so, why the Government did not take early action to avoid this serial blow to farming and the environment?
Baroness Hayman of Ullock (Lab)
My Lords, as I said, I am very aware that the sudden closure, when farmers were expecting more notice, has not been easy and that, for many people who were intending to put in applications, as the noble Lord said about himself, that has caused difficulties. I have friends who are in that boat, so I am very aware that difficulties were caused. I will take the concerns of the House back to the Farming Minister and explain that the unexpected pause and its impacts are felt very strongly by this House. I am happy to commit to do that, because it is important.
The Duke of Wellington (CB)
My Lords, I declare my agricultural interests as in the register. My noble friend Lady Batters very much wanted to be here this evening, but as a working farmer she is having to carry out TB testing today.
Following on from some of the earlier questions, can the Minister give a bit more detail of the advice that the new Ministers were given when they came into the department last July, when presumably the officials were already aware that there might be pressures on the fund? It seems astonishing to everyone in the Chamber that not even the Ministers gave any indication that the funds were running out. Can the Minister give a bit more explanation? The great concern now is that the details of the new scheme may not be announced in the very near future. Can she indicate when the new revised scheme is likely to be announced?
Baroness Hayman of Ullock (Lab)
On the detail of the new scheme, as I mentioned earlier, we will consult with stakeholders on how it needs to be reformed to work better for farmers and the environment. We do not want a repeat of problems for farmers, so we need to get it right. We must also look at budgets through the spending review. I cannot give specifics of when it will start up again, but we will start it up again. The current system will last for three years, so we need to look at how to get the next system in place as soon as practically possible, having taken those steps.
On the six weeks’ notice, the SFI scheme was set up as a demand-led scheme. Our aim was to allow as many farmers to join as possible before it was paused. We were not able to give any advance notice of the need to close, because we were concerned that, if we said that we would be closing it, we would suddenly have a lot of extra demand without the funding to manage that demand. I know that this is not what noble Lords want to hear, but that was the reasoning behind it. We must be able to afford to give the funding to support the applications that come in, and budget constraints are very difficult at the moment.
While we aim to give notice and are clearly aware that the website mentioned six weeks, there is no requirement in the scheme to do that. I appreciate that it did say six weeks. As part of reforming it, we want there to be much more sophisticated, effective budget controls around this. As the noble Lord mentioned, farmers need certainty. To give them certainty, we need to ensure that we can assess the scheme in such a way that we can provide that.
Baroness Hoey (Non-Afl)
I thank the noble Lord for that.
No matter what is said in justification, this will still be seen as an attack on farming, particularly on small farms. Does the Minister agree that the most important job for farmers is to produce good-quality food, and that all funding going into farming should have that as the priority? Why are we allowing so many solar farms to be put on good agricultural land, with other land being used for things other than farming? Surely that must be a priority if we genuinely care about food security?
Baroness Hayman of Ullock (Lab)
The noble Baroness’s question references a lot of the longer-term work that Defra is doing to get these things right. Regarding solar farms, the land-use framework is designed to look at things such as where we put energy, where the best-quality agricultural land is, where we put housing and so on. The land-use framework looks to address much of that.
Regarding what farmers should be doing, whether their first priority is to produce food and so on, we are developing the food strategy and the 25-year road map for farming. Both are looking at how we address this and how we ensure that we have high-quality, sustainable food production in this country for us to become as self-sufficient as is practically possible. These are important long-term pieces of work that the department is doing. We wanted to move away from short-term decision-making that did not deliver in the long run. A big criticism of what has happened with the sustainable farming initiative is that it was too short-term. Taking that bigger picture view, to give farmers certainty for the future, is a really important piece of work that the department is doing.
Baroness Coffey (Con)
My Lords, I know that the Minister is a friend of farmers and recognise her experience in Cumbria and her previous time as a Member of Parliament. She will know that farmers are disappointed. The money that is available through SFI was always intended to increase over the five years of the agricultural transition, so it is no surprise that more and more farms have come in. A record 65,000 are now in agri-agreements. I am really worried in a different way about the intensification of food production, which will actually hamper the progress that had been made in getting farmers signed up to nature. Let us be candid: the ambitious but practical nature targets can be achieved only with the help of farmers and landowners across our country.
Baroness Hayman of Ullock (Lab)
The noble Baroness makes a really good point about the increasing intensification of farming, and that is something we do not want to see. Our focus has to be on high-quality sustainable food that we can buy locally, and on farmers being able to support the country. We said in our manifesto,
“food security is national security”
and that is very true. It is incumbent on us as the Government to look at how we deliver on that promise.
Baroness Boycott (CB)
My Lords, what seems to get missed in this is how little money every farmer in Britain makes out of food. In some instances, especially in dairy, they are making as little as a penny out of what we spend. Are the Government in their food strategy going to ask the supermarkets to be completely transparent about the amount of profits that they make and the supply chains that they operate? Will they ask them to start to implement much more local sourcing and a different kind of supply chain so that farmers, whom we are asking so much of, actually get paid for growing food for us?
Baroness Hayman of Ullock (Lab)
Fairness within the agricultural supply chain has to be a key priority for the Government, because we know that farmers have suffered under different pricing regimes, if you like, for many years. If we do not get it right, we will not be able to get the food security that we want as well, because if farmers are going to produce the food that we are asking them to produce, they have to know that they will be paid fairly for that food.
We are going to use powers in the Agriculture Act 2020 to introduce “fair dealing” regulations that will apply to businesses when purchasing agricultural products from farmers. There have also been new rules for the pig sector introduced to Parliament which ensure that contracts clearly set out expectations and that changes can be made only if agreed by all parties. This continues on from the work that the previous Government were doing, and I am sure that noble Lords opposite will be very supportive of it. Following on from that work on pigs, we are committed to bringing in regulations for eggs and fresh produce sectors, as previously proposed by the Government. If we need to intervene with other sectors, then we certainly need to look at that and see what needs to be done. As I said right at the beginning, we do recognise that this has been an issue for farmers, but we also need to look at how best we can support farmers to create that secure food sector that we so badly need as a country.