Water (Special Measures) Bill [HL]

Baroness McIntosh of Pickering Excerpts

Committee stage
Monday 28th October 2024 Lords Chamber

The Government are already being criticised for lack of progress in meeting those targets; the Office for Environmental Protection, for example, has done work to highlight that. The target of halting the decline of species and biodiversity by 2030 is incredibly close and the Government certainly will not make it if an important body such as Ofwat, which controls the framework within which our freshwater environment flourishes, or not, is not clearly tasked with doing its bit now. As has already been said, it is not just about the five-yearly price rounds; it is about the day-to-day decisions that Ofwat is making as we speak, and will make over the next five years, that certainly need to be guided by this revised duty. I hope that the Minister will give way on that amendment.

[Baroness McIntosh of Pickering (Con)]

My Lords, I congratulate the Minister on bringing forward the first Defra Bill to Committee stage; I congratulate the noble Baroness and those who supported the amendments moved.

I wish to add a note of caution and I declare my interests in the register: not least, I am an officer of the All-Party Parliamentary Water Group, and I worked for five years with the water regulator for Scotland, the Water Industry Commission for Scotland. The degree of caution I would like to urge in this regard is that I believe we are already committed in law. The Water Industry Act 1991 reflects that very carefully, as do the Environment Act and the Agriculture Act and others, not least the Flood and Water Implementation Act 2010, which is built on that.

I urge the Minister to be cautious in trying to reach a balance both in the Bill before us in Committee today and, more especially, the review to which other noble Lords have spoken, which we will go on to consider. I believe that the balance is currently right but falls heavily on the side of environmental benefits. I do not think that it is entirely clear what the costs will be.

I will issue a note of regret that I have not had the chance to go through the 87 pages of the impact assessment, which was released only on Thursday when I was due to speak in a debate on the Friday—literally, the first working day before Committee. One thing I have picked up that the impact assessment looks at is what the cost of natural capital and decarbonisation, for example, would be. I would certainly like more information on this, if possible. In relation to natural capital and decarbonisation, it says:

“This measure will help to protect the Water Environment and improve the state of the UK’s natural capital. The measure will ensure Water Companies take steps to protect the environment”.


It goes on to say:

“The measure is not expected to significantly impact greenhouse gas emissions”.


That is possibly debatable.

We will go on to discuss my main concern in greater depth in relation to amendments in my name in later groups, so I will not argue this at length now. However, I was absolutely astounded to learn this week that water companies are prevented from encouraging customers to take water efficiency measures. This addresses the point raised by the noble Baroness, Lady Young of Old Scone—a very pertinent point in this regard—about keeping customers’ bills down, which has been the concern of successive Governments as well as of the Consumer Council for Water, Citizens Advice and many MPs, as I found when I was next door, along with other noble Peers.

I am concerned that the definition of “wholesome water” is focused entirely on environmental matters and does not allow for measures to introduce water efficiencies, which I think all noble Lords would sign up to, such as recycling grey water to wash vehicles and, possibly, even dishes. I am a firm believer that clean drinking water coming into the home should be kept precisely for that purpose. It is extremely expensive to produce. We should keep drinking water for the purposes of drinking water. We should seek at every opportunity to encourage water companies to encourage their customers, in whichever area they live. In an area of hard water, for example, it is more difficult to work up a lather. Water companies are best placed to know the water quality in that area and I believe they should be allowed to address it.

The second thing that astounded me this week was that Ofwat had taken away some of the powers for water companies to introduce water efficiency schemes. It took some of those moneys away for better use—to give back as grants for water efficiency. I have no truck with Ofwat in this regard, but I would argue that water companies are better placed to know what water efficiency measures will work in each region in which they operate.

I conclude by saying that, while I listened very closely and admire the eloquence and knowledge with which the noble Baroness, Lady Willis of Summertown, moved the amendment, I think we have to err on the side of caution and make sure we are allowing the water companies the tools they need to do the job, to ensure that we preserve as far as possible drinking water for drinking water purposes, and allowing them to roll out measures to ensure that water efficiency going forward will encourage us all to use water differently. They are currently prevented from doing that by the definition as I understand it of “wholesome water”. We will go on to discuss that at a later stage, but one has to be cautious with the best intentions that are sometimes expressed in these amendments.

[Lord Cromwell (CB)]

My Lords, I also add my support for these amendments, and I agree with much of what has been said already. On the matter of water usage, I have lived in deserts and I find the idea of people power-washing their cars with pure drinking water in this country extraordinary. But that is where we are today, I guess.

Why do I support these amendments? It is simply because it is vital that this Bill is consistent with existing policy and legislation to which it naturally links. The only reservation I have, which may be something that comes out of the review, is that it brings us back to the question of whether Ofwat and the Environment Agency should be a single agency or two separate ones with a division of responsibilities.

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Moved by

[Baroness McIntosh of Pickering]

7: Clause 1, page 1, line 17, after “standards” insert “, provided the undertaker is satisfied that the failure to meet relevant standards was due to a failing on the part of the person holding the senior role and not another person, including a developer”

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[Baroness McIntosh of Pickering (Con)]

My Lords, I will speak also to Amendment 8 in my name. These amendments are in a group looking at exemptions from the rules under Clause 1. My particular concern relates to the obligations being imposed by Clause 1, and indeed the rest of the Bill, on water companies where they may not and could not possibly be held responsible for the activities they are undertaking because the fault lies with others who are not currently within the remit of the Bill.

The purpose of these amendments is to reflect the fact that water companies should be held responsible under the terms of the Bill, in particular Clause 1, only for those activities within their specific responsibility. Clearly, for example, where there are missed connections between wastewater pipes and major developments, water companies should not be held responsible if they are obliged to fit these new connections into inadequate, antiquated pipes that simply cannot take the amount of waste coming.

The background to this very simple measure follows from the Pitt review—the noble Baroness will recall that I raised this at Second Reading—following the severe floods of 2007. I think it is worthy of note that Sir Michael Pitt is from East Yorkshire, which is more vulnerable to coastal flooding than just about any other part of the country. His 2007 review identified, for the first time, surface water flooding as well.

In connection with surface water flooding, the two most consequential amendments set out that mandatory construction of sustainable drainage systems in major developments should take place so as to contain floodwater and prevent it mixing with sewage through overflows into the combined sewers.

Further, and this is where the developers should have a responsibility and not the water companies, I ask the Minister to look favourably at ending the automatic right to connect, which has so far never happened. That one measure alone would mean that misconnections—whereby the existing infrastructure is deemed to fit the amount of wastewater coming from major new developments—would simply not happen in the future. Most of these developments are made up of four or five-bedroom homes with, dare I say, four or five times the amount of sewage coming out of them into inadequate Victorian pipes. Currently, under the planning rules, developers and local authorities deem those connections to be safe and refuse to put in appropriate infrastructure to ensure that a safe connection can be made. Were the water companies to be recognised in the planning application process as statutory consultees, on the same basis as the Environment Agency comparatively recently has been, those misconnections could be averted. The simple measure of making water companies statutory consultees, on the same basis as the Environment Agency, would help in that regard.

When she looks at these amendments in summing up, would the Minister agree to obliging developers to have sustainable drains fitted to take excess rainwater into a soakaway, pond or culvert to prevent it mixing with sewage water in combined sewers, which is currently leading to sewage overflows? It is not fair to make the water companies responsible for that. Were they to be statutory consultees, they would probably argue that the wastewater will not fit the pipes currently in place.

This has led to some very perverse sewage spills. I remember when I was in the other place there was a school in Filey that suffered £1 million-worth of damage to its swimming pool and, I think, the maths department. Existing developments had to be evacuated for six to nine months because of the public health aspect of sewage coming in. Precisely because a small development of only 30 houses was pumping out so much sewage, the rainwater when mixed with it had nowhere else to go and it went into the school and the existing developments. I am sure noble Lords could give other examples of this.

I ask the Minister to review the way in which highways currently contribute to pollution through rainwater running off the road surface, taking with it oil, brake fluid and other pollutants. When this combines with floodwater, it enters the combined sewers and then often goes into homes, causing huge damage and a public health disaster.

I hope the Minister will agree that water companies should be held responsible for those activities within their control but cannot be held responsible for circumstances which are outwith their control. These two small, tightly-drawn amendments would fit that purpose.

I conclude by asking the Minister this. If these amendments are not added to the Bill, what mechanism do the Government intend to use to ensure that water companies will be held responsible under the Bill only for activities under their direct control and not those under the control of others, such as developers and highways authorities, which are currently excluded from the remit of the Bill? I beg to move.

[Baroness Pinnock (LD)]

My Lords, I broadly agree with the amendments in the name of the noble Baroness, Lady McIntosh. She raised some important issues, about, first of all, the way that surface water drainage is treated. As the Minister will know, surface water is combined with sewage water in the same pipes in many of our towns and cities, and increasing rainfall and development is putting pressure on that combined drainage system.

The other issue to consider, which the noble Baroness raised, is the pressure put on local authority planning services to agree to housing developments where the existing infrastructure is not appropriate to support them, with developers reluctant to fork out huge sums of money to pay for the additional drainage systems needed. The answer lies in empowering local authorities’ planning services to put conditions on planning consent which specifically require developers to build the appropriate infrastructure to support the development that they wish to build.

There is a related point. I am a local councillor; in my experience, where there is an issue of surface water, the planning services require underwater attenuation tanks to be built to hold that water until it can be released to the natural drainage systems, such as streams. However, the developers are very reluctant to do that, and are seeking to get around it in other ways. Surface water drainage issues and local authorities’ inability to enforce this is something that the Minister may wish to raise with her colleagues in local government when it comes to reforms of the planning system, as it will affect the Minister’s environment responsibilities. I agree with the amendments tabled by the noble Baroness, Lady McIntosh.

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[Baroness Hayman of Ullock (Lab)]

My Lords, through provisions introduced by Clause 1, Ofwat will be able to issue new rules on remuneration and governance to ensure that companies and executives are subject to robust oversight and held accountable for failure. Among other things, these rules will ensure that executives will no longer be able to take bonuses where companies fail to meet standards on environmental performance, financial resilience, customer outcomes or criminal liability.

Amendments 7 and 8, introduced by the noble Baroness, Lady McIntosh of Pickering, seek to ensure that these rules apply only in instances where the failure to meet the required standards is due to a failing by that individual and not another person. I start by reassuring the noble Baroness that, should companies meet their performance expectations, executives will rightly be rewarded. However, the changes proposed through Amendment 7, in particular, would make it more difficult for Ofwat to implement the rules on remuneration and governance in a meaningful way. This is because it would introduce an additional test to be met before the bonus ban could be applied, where a link between the specific actions of an individual senior leader and the performance failings of a company as a whole might be difficult to demonstrate.

Senior executives are also collectively responsible for the actions of the company and therefore should be held responsible for poor performance. However, having said that, Ofwat has stated, in the policy consultation it published last week, that, while it intends for the rules to apply to most performance-related pay decisions by water companies,

“there may be … exceptional circumstances where a payment should not be prohibited”.

For example, if an incident leading to a rule breach was clearly and demonstrably beyond the control of the company, this could be grounds for an exemption from the ban.

Considering the changes proposed by Amendment 8, we also consider it unlikely that individuals in senior roles will fail to meet Ofwat’s future standards of “fitness and propriety” due to a failing on the part of another person. The potential criteria proposed by Ofwat in its consultation to measure “fitness and propriety” include character, previous conduct, and knowledge. These criteria are specific to the individual, rather than the performance of the company, and do not obviously relate to acts by other persons.

I just want to mention an issue that the debate moved on to, around drainage and SUDS. We are going to be discussing SUDS further in group 8, so we shall talk about that then, but I want to assure the noble Baroness that we are engaging with officials in MHCLG, because it is really important that we have a proper discussion around planning and drainage as we move forward with development. I am very aware of the problems that surface water can cause in new development if it is not thought through properly.

The noble Lord, Lord Cromwell, drew the Committee’s notice to the commission and asked whether it would be discussed there. I will draw the Committee’s attention, for interest, to part of the scope of the commission:

“Where housing, planning, agriculture and drainage interlink with strategic planning for the water system, these are in scope. ... The commission should have regard to how the water sector regulatory system provides the certainty around the provision of water infrastructure needed to underpin development plans, housing growth and sustainable development, while strategically protecting and enhancing the environment. This should include how regulation and planning for water infrastructure and for residential and commercial development can work together more effectively to anticipate and invest to provide for future growth, to quickly resolve and prevent issues where water and wastewater capacity constraints may otherwise inhibit necessary development (such as through their impact on requirements for water and nutrient neutrality)”.


So, although it is not entirely dealing with the issue around SUDS, I think it is something we need to explore further with the housing department, for example, and with local government. There is an opportunity to look at development and water within the scope of the commission. I hope that is helpful for noble Lords to understand.

I hope I have reassured the noble Baroness that the rules will be applied to individuals in a proportionate manner, and made clear why the Government consider these amendments to be unnecessary.

[Baroness McIntosh of Pickering (Con)]

My Lords, I am grateful for the opportunity to debate in some depth these two amendments. I just clarify that the automatic right to connect is very different from SUDS and I do not think the noble Baroness addressed that point. I still have reservations, because I believe it is inappropriate in terms of Clause 2 to speak about pollution incident reduction plans when so many of the sewage discharges can self-evidently be found not to be the responsibility of water companies at all. As the noble Lord, Lord Cromwell, so eloquently and appropriately recorded, these incidents are only going to increase as we see the number of major new developments of four-bedroom and five-bedroom houses increase.

Water (Special Measures) Bill [HL]

Baroness McIntosh of Pickering Excerpts

Committee stage
Monday 28th October 2024 Lords Chamber

Moved by

[Baroness McIntosh of Pickering]

11: Clause 1, page 2, line 8, at end insert—
“(iia) meeting relevant standards issued under Schedule 3 of the Flood and Water Management Act 2010 (Sustainable Drainage),”

[Baroness McIntosh of Pickering (Con)]

My Lords, I welcome the opportunity to debate Amendments 11 and 12 in my name in this group, on flood and water management. The amendments relate to Clause 1 and, in particular, tie the environmental standards which the department has set out in the Bill to those specifically meeting relevant standards issued under Schedule 3 to the Flood and Water Management Act. So it is the same provision to come in two separate places.

I am very grateful to the Minister and members of the Bill team for meeting me prior to Committee to discuss this. I invite the noble Baroness to accept that this amendment and the provisions in Schedule 3 to the Flood and Water Management Act 2010 are Defra legislation, so I would like her department to take ownership of this. She is aware of my desire and passion that we implement the provisions of Schedule 3 to the 2010 Act as a matter of urgency. Defra itself has explained that Schedule 3 provides a framework for the approval and adoption of drainage systems, a sustainable drainage system approving body within unitary and county councils and national standards on the design, construction, operation and maintenance of sustainable drainage systems for the lifetime of the development. Schedule 3 also makes the right to connect surface water run-off to public sewers conditional on the drainage system being approved before any construction work can start. That goes to the point of ending the automatic right to connect that we discussed in a previous group.

Wales has already applied Schedule 3 and has done a report on how it has been implemented. It is not entirely perfect and there are ways in which it could be improved, but we have been yo-yoing on this under successive Governments and it now falls to her Government and her department to really run with this.

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[Baroness Hayman of Ullock (Lab)]

My Lords, I thank the noble Baroness, Lady McIntosh of Pickering, for her amendments relating to Ofwat’s duties. I will take Amendments 11 and 12 together.

As I have previously noted, public trust in the water sector has been severely damaged, and the number of serious pollution incidents is increasing, yet companies are still paying out millions in bonuses. To rebuild public trust, we are creating a new framework to support accountability, including the new rules relating to remuneration and governance. As the independent economic regulator of the water industry, Ofwat will be responsible for developing these rules.

However, the Government are clear that environmental standards are a vital component of performance. As such, the Bill requires the forthcoming rules to include standards that relate to the environment. The noble Lord, Lord Blencathra, has mentioned the devastation that flooding can bring; I reassure him and other noble Lords that I completely understand why it is so important for us to tackle flooding. I live in a house that has been flooded—living in Cumbria, you are always aware of these issues.

With regard to the Flood and Water Management Act 2010 specifically, while the Act includes provisions relating to sustainable drainage, it does not prescribe or define any environmental standards capable of being applied in this context. It would therefore not be appropriate to include reference to standards in this legislation within Ofwat’s rules, as Ofwat does not have any functions or expertise in relation to the technical requirements prescribed under the Flood and Water Management Act 2010.

The noble Baroness, Lady McIntosh, suggested that Defra should take ownership of delivering this. The issue we have is that it also impacts directly on development and developers, which is why the Government are currently working with the Ministry of Housing, Communities and Local Government to assess how best to implement their ambitions on sustainable drainage, while also being mindful of the cumulative impact of the new regulatory burdens on the development sector. At this stage, I do not want to pre-empt the outcome of that process.

On this basis, the Government do not accept either of the amendments from the noble Baroness. However, I would like to say that the noble Baroness knows that I am very sympathetic to her concerns. As she said, we have discussed this previously. If she is willing, I suggest that we look to arrange a meeting between herself, myself and MHCLG, in order to discuss this further, where she can clearly explain her concerns to both departments—Defra and MHCLG—that have responsibility for moving forward on this.

[Baroness McIntosh of Pickering (Con)]

My Lords, I am most grateful to all who have spoken, and in particular for the support of the noble Baroness, Lady Pinnock, and, from a sedentary position, the noble Baroness, Lady Parminter, as well as my noble friend Lord Blencathra. He referred to the flooding. I was actually a candidate—at a very early age—for Workington in 1987. I went back and visited as a shadow Minister during the severe floods of 2007 and 2009, so I am well acquainted with the pressures faced by Carlisle, Keswick and Cockermouth. It was very sad to see that many of the residents felt that they could not afford to take out insurance in those floods.

I will add that it is not just flooding that concerns me; it is the surface water going into the combined sewers taking the sewage from the new developments that do not have mandatory SUDS that is causing the problem.

I would like to take up the Minister’s offer. It would be good to have the meeting before Report, because I would be prepared to come back with these amendments then. Alternatively, if the department wish to come forward with even better amendments that achieve the same end, that would be very welcome.

Waste: Incineration

Baroness McIntosh of Pickering Excerpts

Tuesday 22nd October 2024 Lords Chamber

[Baroness Hayman of Ullock (Lab)]

My Lords, it does say in the Companion that you should not thank a noble Member for their Question—so, on this occasion, I will not. The environmental permitting regulations prevent the incineration of separately collected paper, metal, glass or plastic waste, unless it has gone through some sort of treatment process first. Following that treatment, incineration is seen to be the best environmental outcome. We know that the recycling rate is too low, that we burn too much waste and that, for too long, recycling rates in England have plateaued. The way forward is to look at the whole big picture and our circular economy ambitions are designed to address this.

[Baroness McIntosh of Pickering (Con)]

Will the noble Baroness commit to looking not just at incinerators but at anaerobic digesters and accept that they have a powerful role to play not just in getting rid of residual waste, particularly household waste, which is a very vexatious challenge, but in heating people’s homes at a reduced rate? Will the Government keep an open mind on energy from waste, including anaerobic digestion?

[Baroness Hayman of Ullock (Lab)]

As I just mentioned, we are looking to do a review right across the piece on this, so anaerobic waste will certainly be part of that.

Rural Communities

Baroness McIntosh of Pickering Excerpts

Tuesday 15th October 2024 Lords Chamber

Asked by

[Baroness McIntosh of Pickering]

To ask His Majesty’s Government what are their priorities for rural communities over the next two years.

[Baroness McIntosh of Pickering (Con)]

My Lords, I am delighted to have this opportunity to debate such an important subject and am deeply grateful to have secured this Question for Short Debate. I declare my interests as honorary president of National Energy Action, honorary associate of the British Veterinary Association, and honorary vice-president of the Association of Drainage Authorities; I also work with the Dispensing Doctors’ Association. I look forward to all contributions this evening, but especially the maiden speech of the noble Lord, Lord Elliott.

Rural communities face many challenges and are of a different nature from urban communities, yet in policy terms they are frequently overlooked. While the 2024 Labour manifesto did not specifically mention rural communities, many of the commitments it did include may damage them. There is a desperate need to support farming and other businesses in rural areas with better broadband and mobile connectivity. A lack of public transport in rural areas means that young people are unable to access jobs, while older people find access to hospitals and healthcare challenging for the same reason. The £2 bus fare has helped, but will the Government keep this? There is inadequate public transport in rural areas, but I see no point in devolving more powers to local communities and leadership for bus and other local transport provision if there are no additional resources to meet the new responsibilities.

Planning rules and guidance go some way to protecting rural communities—for example, the ban on building on flood plains and areas prone to flooding. However, rural communities are often used for the convenience of urban communities, with energy being a good example. Too often, energy is generated at sea or on land far away from where it is to be consumed. That energy then traverses rural communities, which are blighted by pylons, without gaining any of the benefits such far-flung, sparsely populated communities long for in often cooler climes with poorly insulated houses and residents on low incomes. It transpires from a Government-sponsored study that it can be cheaper to transfer electricity underground rather than through unsightly, environmentally unfriendly overhead-line transmission. Power lines should be placed underground, or alternatively, electricity generated from renewables should serve those closest to the source of the power generated.

Turning to public services, these are often more costly to deliver in rural than urban areas. Hospitals and GP surgeries can be difficult to access. Every increase in fuel duty affects the ambulance service. There is poor broadband mobile connectivity, meaning that dispensing doctors and rural GPs are unable to issue electronic prescriptions. There are inequalities of healthcare between urban and rural areas which need to be addressed. One hopes that the follow-up to the Darzi review will tackle these.

Rural communities have a desperate need for a smaller, affordable one-bedroom or two-bedroom homes, yet the Government are planning to build 300,000 houses a year, many in areas of water stress and on flood plains and mostly with four or five bedrooms. This will not address the shortage of affordable homes in rural areas but will create problems of increased sewage and houses with five or five times the amount of sewage coming out into inadequate water pipes which, when mixing with floodwater in combined sewers, will enter the sea and rivers.

Farming lies at the heart of the rural economy, yet farmers face great uncertainty. Farmers have a role to play in creating better self-sufficiency, energy and food security, generating power through renewables on their land, and they would like to sell into the national grid. In terms of storing floodwater on farmland, as we heard last week, farmers perform a public good, which should be recognised—along with other public goods that they perform—through the environmental land management schemes. Yet there is an underspend in Defra. I have seen one figure of £138 million and one of £350 million. There is also mounting concern over the forthcoming Budget, not least on the implications of inheritance tax for farms. The Government must give certainty and clarity to farmers by spending the moneys committed to farming in full and setting an increased multiannual agriculture budget for the duration of this Parliament.

To boost food security and self-sufficiency, we must consume more home-produced food and fewer substandard food imports from third countries. It would be very helpful to have an update on the land-use framework, the National Planning Policy Framework and planning policy guidance, to reflect farming being the primary role of the countryside. While environmental benefits sit comfortably with best farm practice, the mass development of solar panels, tree planting, carbon offsetting and housebuilding on Britain’s most productive and fertile land does not make good sense. In the Budget on 30 October, will the Government commit to reviewing the agricultural property relief in a compassionate way, to ensure that it remains available to those landlords prepared to let for the longest terms—10 years or more—to give tenant farmers greater security? When farmers do well, rural communities and market towns flourish.

Racing also plays a major role in rural communities. North Yorkshire plays host to racecourses at Ripon, my former constituency Thirsk, York, Wetherby and Doncaster, jewels in the crown of 54 courses dotted around the UK. Overall, racing is the second-largest spectator sport in Britain, yet it has experienced significant economic challenges recently, from the pandemic to inflationary pressures of the cost of living crisis. I urge the Government to consider ways to encourage racing, which supports 85,000 jobs across mostly small and medium-sized businesses and is a major employer in many areas, including my own former constituencies, the Vale of York, then Thirsk and Malton, providing career opportunities for young people as well as an outlet for leisure, hospitality and tourism.

The role of vets in rural communities is crucial. The veterinary profession is an integral part of the agricultural and food sector, working collaboratively with others to protect animals, people and the environment they share. Vets working across the meat sector underpin the economy, providing value to the £9.1 billion domestic meat industry and the £2.1 billion meat export trade. The vet/farmer relationship is an integral part of any farming team at every stage, from farm to fork, and facilitating trade too. Vets have a health and welfare role to play, not least at auction marts such as that at Thirsk, as well as on the farm.

A strong working relationship across the whole farming team is vital, yet an ongoing issue facing the veterinary sector in rural areas is the veterinary workforce shortage, which I hope that the Minister and the Government will address. The number of qualified vets joining the profession decreased when we left the European Union and it is felt that the new salary threshold will exacerbate the UK veterinary workforce shortage.

I welcome the Minister to her place as the rural communities Minister and ask her to value rural communities, to use the forthcoming spending review to restore the balance in spending in rural areas and to ensure a fairer spend on public services such as health, transport, housing and energy. That will give farmers—the largest sector in the rural economy—certainty and clarity of policy going forward, and ensure that all farmers can prosper and survive, whether they are arable farmers, livestock farmers, tenant farmers, owner-occupier farmers, family farms or larger farms.

Will the Government take the opportunity to create an energy policy that works for everyone, whether living north or south, in an urban or a rural community? I know that, in replying, the Minister will say that her hands are tied by both the forthcoming Budget and the spending review. However, the opportunity must not be lost to ensure a vibrant future for farming, for racing, for market towns and for auction marts, where everybody in rural as well as urban communities can prosper throughout the length and breadth of the land.

Flood Prevention: Farmers

Baroness McIntosh of Pickering Excerpts

Thursday 10th October 2024 Lords Chamber

[Baroness McIntosh of Pickering (Con)]

I congratulate the right reverend Prelate on securing this very important debate, which is very timely given the recent wet weather. I declare my interests in the register. In particular, I am a vice-president of the Association of Drainage Authorities, which encompasses the internal drainage boards.

As the right reverend Prelate said, farmers perform a huge public role producing food and delivering wholesome products domestically, battling the elements as they do so. They can and do face unfair competition from substandard imports and the inability to bid favourably for major contracts with prisons, schools, hospitals and others. However, farms are businesses, and they need to make a profit and have a sustainable business model.

Flood water is retained on farmland, which in turn protects businesses and properties downstream from flooding, yet often this service is neither recognised nor rewarded. Farmers are responsible for keeping the riverbanks on their land free from debris and maintaining the embankments, which act as a flood defence and are often in a state of disrepair. In addition, as members of internal drainage boards in low-lying areas, farmers provide the vital service of maintenance, dredging watercourses and performing flood prevention schemes.

The Environment Agency’s resources, as we know, are spread thinly and do not stretch to cover rural areas on the same basis as urban ones. The issue of maintenance and repair of pumping stations is hugely important as, where flood banks are breached in extreme floods or pumping stations fail, devastation follows for farmland and properties alike. Where farmland floods, thereby protecting other businesses and communities, it is only right that the farmer affected should be recognised for the provision of that public good on his or her land. I am sure that many farmers take a view that, if they were properly compensated for the provision which enables them to remain with a viable business, that would be an acceptable recognition for the service to the community they are providing.

Local authorities in rural areas also have a role to play but we know that their budgets are under great pressure. This is not helped where money for flood defences and prevention is not ring-fenced. Where regular maintenance does not take place, this makes farmland yet more vulnerable to floods. I believe that farmers and organisations such as golf clubs would be open to creating reservoirs on their land but are discouraged from doing so by the prescriptive provisions of the Reservoirs Act 1975. The Flood and Water Management Act 2010 modified that Act to reduce from 25,000 to 10,000 cubic metres the capacity at which a reservoir will be regulated. This should be revisited urgently. If it was reviewed, it would help more reservoirs to be created on farmland and other land, such as golf courses.

Sufficient investment must be made to maintain and manage our river systems. I have long argued that there should be a total budget for flood defence spending—totex—as opposed to conflicting and competing revenue and capital funding spend. This came to light most graphically when there was an enormous row during the flooding on the Somerset Levels some years ago, about whether the moving of a pump on to that land constituted revenue or capital spend. The farmers did not care what it was; they wanted the pump to be on the land to pump the water off the farmland, protecting it and communities downstream. Better use must be made of current budgets by rebalancing spending allocations from the current heavily weighted capital investment choice to a much more balanced approach, favouring revenue funding and the long term, to bring all flood risk assets and rivers back up to good condition.

Farmers have suffered significant challenges in recent years—Covid, the impact of hostilities in Ukraine, higher energy costs, and heavy losses of crops given the sheer scale of floods over the last 18 months. Floods this year have impacted on both arable and livestock farmers alike. As reported in the Yorkshire Post today, what makes the situation so grave and urgent, after weeks and months of flooding and saturated land, is that the impact on food prices is already being felt. The potential consequences for food security and self-sufficiency are significant, as highlighted by the right reverend Prelate. I therefore join his call for action. I press the Minister to confirm that the Government will go ahead with the expanded offer of the farming recovery fund, and to recognise what was always understood: that the public good that farmers perform with flood storage on their farmland will be recognised and receive compensation through the ELM scheme.

Will the Minister review the Reservoirs Act 1975, as amended by the 2010 Act and others, with a view to encouraging more reservoirs to be built on farmland and other areas, such as golf clubs? At present, she must recognise that the duties on landowners of smaller reservoirs are simply too onerous, with responsibilities for inspections and failure in this carrying criminal penalties and convictions for such offences. Finally, will the Minister look at amending the flood defence grant in aid to ensure that farmers and rural communities are treated on a more equal basis with urban areas and receive better protection from future floods?

Water (Special Measures) Bill [HL]

Baroness McIntosh of Pickering Excerpts

2nd reading
Wednesday 9th October 2024 Lords Chamber

[Baroness McIntosh of Pickering (Con)]

I am delighted to follow the noble Lord. I congratulate the Government on bringing forward this Bill so early in the Session and on the ongoing work that the noble Baroness set out in the water sector. I welcome her to her place as she guides her first Bill through this House. I declare my interests as an officer of the APPG on water, as co-author of Bricks and Water reports on various aspects of flooding and water management and as having worked with WICS, the Water Industry Commission for Scotland, for some four or five years to 2015.

The Bill examines the role and powers of the water industry regulators and the responsibility of water companies. The Explanatory Memorandum sets out the legal background to the Bill and refers to a number of previous Acts that are referenced or amended by the Bill. However, there was one glaring omission, that of the Flood and Water Management Act 2010, which set out many of the standards referred to in the Bill—for example, on page 2 of the Bill, standards that relate to the environment.

There are clearly, as my noble friend Lady Browning set out, related issues between the flooding and pollution aspects of the Bill. Others—the noble Baroness, Lady Parminter, in particular—have referenced the need for natural and sustainable solutions and to involve farmers in a constructive way to prevent flooding.

The Pitt review, following the severe floods of 2007, set out a number of recommendations, many of which were included in the 2010 Act, following on from the recognition—for the first time ever—of surface water flooding. Yet two of Pitt’s most consequential amendments were never adopted: first, the mandatory construction of sustainable drainage systems in major developments so as to contain flood water and prevent it mixing with sewage through overflows into the combined sewers; and, secondly, ending the automatic right to connect, which has never happened. This simple measure in and of itself would prevent misconnections, whereby the existing infrastructure simply cannot take the volume of sewage from major new developments, often of four- or five-bedroom homes, with four or five times the amount of sewage coming out of them into inadequate Victorian pipes. The developers and local authorities therefore deem the connections to be safe and refuse to put in appropriate infrastructure to ensure that a safe connection can be made. Were water companies also to have the status of statutory consultees in the planning application process, these misconnections could also be averted.

I therefore urge the Minister to use the passage of this Bill to complete the unfinished business from the Pitt review of 2007 by ending the automatic right to connect, ensuring that developers pay for new connections and mandating developers to construct sustainable drainage systems at the time that a development is built. I shall seek to press the Minister to implement Schedule 3 to the Flood and Water Management Act 2010 without delay, to end the automatic right to connect and to insist on mandatory use of SUDS; otherwise, as the noble Baroness, Lady Parminter, so eloquently pointed out, we will just load more sewage into the watercourses, rivers and seas for the foreseeable future, which is not acceptable.

I would also like the Bill to reflect the impact that the housebuilding programme is having on the ability of water companies to perform their duties under the Bill. The Bill gives the House the opportunity to end the gap in responsibilities between planners, investors and housebuilders and to recognise the responsibility of others, such as highways authorities, which contribute to road surface water run-off entering the combined sewers and storm drains without currently having any responsibility to prevent this form of pollution. That is very costly indeed and is a gap that must be plugged—to coin a phrase.

On Clause 2 and the pollution incident reduction plans, can the Minister say how onerous she expects it will be, in terms of both time and resources, for the water companies to implement them? Will allowance be made through either the existing price review or, more likely, subsequent price reviews for this time and resource factor to be taken into account?

During the passage of the Bill, I hope that we will have the opportunity to consider the role of regulators and comparisons between Ofwat and others such as WICS—the Water Industry Commission for Scotland—particularly as regards customer engagement. I also take note of the fact that Ofwat has only comparatively recently allowed prices to be fixed as part of the quin- quennial review to take account of innovation. Actually, innovation lies at the heart of what the Government are proposing to do in this Bill and the future work that they have set out this afternoon.

Two of the areas in which I believe WICS is very strong in the statutory duties that it performs are promoting the interests of Scottish Water’s customers, including having regard to the interests of current and future customers, and ensuring that customer charges reflect the lowest reasonable overall cost for Scottish Water to deliver Scottish Ministers’ objectives for the water sector. That has in no way compromised the independence of WICS in the way that it operates.

In looking at the level of penalties, I urge the Government to make them proportionate to the offence and the scope and means by which it is actually within the power of the water companies to prevent pollution in the manner in which the Government intend them to be held to account.

Regarding the proposal from the noble Duke, the Duke of Wellington, and others, such as the noble Lord, Lord Cromwell, in support of the idea of establishing one regulator, I remember, in a previous life as a shadow Minister, under the good offices of my noble friend Lord Blencathra, looking at this matter prior to one of the elections—probably the 2005 election. We were going to have “blue water thinking” on scrapping the existing regulators and coming up with one new regulator. So that is the challenge that lies at the door of the current Minister and I wish her extremely well in that regard. We stepped back from that commitment at that time.

There is plenty more to say, and I look forward to saying it in Committee.

Environment and Climate Change Committee Report: An Extraordinary Challenge: Restoring 30 per cent of our Land and Sea by 2030

Baroness McIntosh of Pickering Excerpts

Wednesday 11th September 2024 Grand Committee

[Baroness McIntosh of Pickering (Con)]

I add my voice in welcoming this excellent report and I congratulate the noble Baroness, Lady Parminter, and her committee on it and on securing the debate today. I declare my interests: I sit on the rural interest group of the Church of England Synod, and I am a patron of Upper Teesdale Agricultural Support Services. In upper Teesdale, almost 50% of the farms are tenanted, as they are in North Yorkshire, where I was an MP. As with every area of policy—this is no exception—we need to balance the interest of preserving nature and the natural world with that of those engaged in making a living and running a business in that environment. There is always a danger, which may flow from mapping and monitoring, of setting arbitrary targets that are too prescriptive and threaten that balance, as set out in the report.

I shall take a perhaps more parochial and domestic view than that of my noble friend Lord Goldsmith, whom I congratulate on what he achieved at COP 15. I will look at SSSIs and national parks, where setting planning policies too strictly prevents farmers and businesses, such as tourism and hospitality, from operating freely. The report has an omission, in that it does not reflect on the role of farmers and businesses in this regard, and indeed that of fishermen in protecting and restoring our seas. We must allow them to ply their trade, earn a living and provide food for the country.

Marine life faces a threat from the development and operation of offshore wind farms. We took evidence on this in the previous EU Energy and Environment Sub-Committee, under the excellent chairmanship of the noble Lord, Lord Teverson. I firmly believe that more research needs to be done in this area.

Farmers play a crucial role as custodians of the countryside and are integral to rural communities. Farmers manage 70% of the UK’s land area and must be regarded as key partners in nature conservation. They have faced a plethora of changes in the new schemes in a very short timeframe and, frankly, an IT system that is not fit for purpose. Recognising their contribution to the natural world will encourage and incentivise landowners and tenants alike to increase their engagement in policy. In developing the 30 by 30 policy, we must recognise the role of farmers on the land and ensure that nature conservation, if it is to be successful, is underpinned by a prosperous, economically viable farming sector.

Farmers have faced a major reset of policy since we left the European Union, and the more that environmental programmes such as ELMS and SFI have regard to the public good and allowing farmers to do that work, the better. Farmers need clarity and certainty in that regard going forward. After seven years of specific support under the CAP, farmers need to be able to create a long-term viable business plan.

Will the Minister, who I welcome to her place today, commit to Defra spending the identified underspend of £358 million over three years? Will she ensure that that money is spent not just on nature conservation but in working with farmers to ensure that they are allowed to grow crops and produce food to boost food security, self-sufficiency and increased exports abroad?

The position of tenant farmers has been ably expressed by a number of speakers, notably my noble friend Lady Rock and the noble Earl, Lord Caithness. This issue is particularly key in upland areas and on family farms in SSSI areas; the role of national parks here must be made clearer. In many instances, tenants are simply not able to claim for environmental schemes as they do not own the land on which they farm. I understand from UTASS that some 70 farming families are stuck in agreements at this time; that the agreements are almost 20 years old; that there has been no review of payments; and that those in the schemes have no ability to enter or transfer into SFI or country stewardship schemes. That is unacceptable. I understand that Natural England has a role in this regard, but we have to query whether it has the resources and the time to commit to this matter at this crucial stage.

ELMS has not emerged as the simpler, less complex, easy-to-administer scheme that farmers and the public were promised. That has to change. We must also end this piecemeal approach to reform and have a comprehensive and holistic approach that recognises what works and when. For example, an area that is good for wading birds is simply not suitable for rewilding or tree planting. I endorse entirely what my noble friend Lady Rock has said. It is unacceptable to propose booting a tenant farmer off the land that they have farmed for a generation in north Yorkshire in order to make way for yet another solar farm. That is not the way forward.

In summing up today, will the Minister undertake to consult closely with farmers and farming organisations going forward as the Government create new policy, starting with forthcoming Bills such as the Water (Special Measures) Bill but including—even more importantly—the Budget on 30 October? We must recognise the specific challenges that farmers have faced over the past five years: the fallout from Covid; imperfect supply chains; the higher input costs of energy and fertilisers, with poorer returns and a shortage of labour; and extreme weather, together with major flooding.

I disagree with my noble friend Lord Banner, whom I welcome to his place. I chaired the Environment, Food and Rural Affairs Committee when we did a degree of work looking at how, if we were to dispense with the badger cull, we would have to accept badgers continuing, across the country, to introduce TB into herds that are currently not infected. I urge my noble friend to reconsider his views in this regard; in saying that, I hope not to be attacked by badger lovers, as I have been previously.

I would like to say a word on sites of special scientific interest. As I mentioned previously, I understand that changes to those schemes must be endorsed by Natural England. Does it have the resources? Will the Minister look at this and perhaps write to me afterwards?

Following today’s report, I ask the Minister to set out what is going to change. Will Defra be clearer about how its 30 by 30 ambition links with other policies, including the Environment Act, the protected landscape targets, the land use framework, the local nature recovery strategies, Natural England’s designation programme and national planning policies? Will she ensure that there is an SFI option for upland and moorland to ensure a sustainable future for upland and family farms? Will Defra ensure that farmers and other businesses working in the countryside are able to do their jobs, while enhancing the environment as conservationists at the same time?

South West Water: Brixham Contamination

Baroness McIntosh of Pickering Excerpts

Wednesday 22nd May 2024 Lords Chamber

[Lord Douglas-Miller (Con)]

The noble Lord has some very impressive statistics on Scottish Water. I happen to be the beneficiary of Scottish Water because I live up there. It is not quite as rosy as he tells us, because one area on which we have made great progress in England has been storm overflows and monitoring and understanding exactly what is going into our river systems. If the noble Lord was to look at that area in Scotland, he would find it very deficient.

[Baroness McIntosh of Pickering (Con)]

My Lords, does my noble friend agree that the water companies play an important role as owners of agricultural land? It is extremely important that we get to the bottom of what caused this incident to ensure that tenant farmers know exactly what their position is concerning South West Water and the Brixham contamination, as well as other landowners.

[Lord Douglas-Miller (Con)]

I completely concur with my noble friend that it is critical that we get to the bottom of what has happened to have generated this outbreak of cryptosporidium. It is currently far too early to know the exact cause of the outbreak. South West Water is continuing its investigations to confirm the source of the contamination. The Drinking Water Inspectorate has initiated its investigation into the cause, extent and actions of the company and begun collecting evidence on site. I should point out that it is the Drinking Water Inspectorate which is taking the lead on this investigation.

Management of Hedgerows (England) Regulations 2024

Baroness McIntosh of Pickering Excerpts

Monday 20th May 2024 Grand Committee

[The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Lord Douglas-Miller) (Con)]

My Lords, I declare my interests as set out in the register.

I am sure that many noble Lords will agree that hedgerows are precious features of our landscape, enriching our environment and wildlife. Many of our wild birds depend on them, including red-listed birds such as the linnet and the yellowhammer. Hedgerows also help food production by supporting pollinators, providing windbreaks and shelter, and protecting the soil. I am therefore pleased to bring before this Committee this statutory instrument, which proposes further to protect our hedgerows. The instrument establishes by legislation a common approach to managing hedgerows on agricultural land in England. It builds on the existing legal protections for some hedgerows, which will remain in place.

In proposing this legislation, we have listened to the views of many who cherish our hedgerows, including many farmers. I thank those who responded to our consultation on protecting hedgerows; their insights have enriched our understanding. We received almost 9,000 responses, which we have considered carefully. The responses showed how much hedgerows are valued. There was strong consensus from environmental and farming stakeholders alike that hedgerows should be protected in domestic law in a similar way to the previous hedgerow management rules provided by cross-compliance.

That is what this statutory instrument does. It aims to provide a familiar baseline for hedgerow management. We want to make sure that everyone knows what is expected and is supported to follow good practice. As a safeguard, we are also making sure that there are clear, proportionate consequences for the small minority who might choose to ignore it.

I know that these rules are simply a reasonable minimum which most farmers have been practising for many years. Farmers are the guardians of our hedgerows, protecting, planting and maintaining them for generations. I thank them for their continued efforts to help wildlife thrive on their farms, alongside food production. We trust them to continue to do the right thing. In fact, many are already going further than required by these regulations. We have seen strong uptake of options to manage and further improve hedgerows under our agri-environment schemes. I am delighted to report that there are already more than 20,000 agreements or applications in place, contributing to the management of over 60,000 miles of hedgerow in England. We look forward to working in partnership with many more farmers to manage and improve their hedgerows in future.

The purpose of these regulations is to protect hedgerows in order to support biodiversity, benefit the environment and enrich the landscape. They will make sure that all farmers are treated fairly by upholding common rules for managing hedgerows, and they will provide clarity on what is expected. The regulations govern the management of “important” hedgerows on agricultural land. Broadly, this means hedgerows which have a continuous length of at least 20 metres or which, if shorter, meet another hedgerow at each end. They do not apply to hedgerows within or forming the boundary of a dwelling house. Because the regulations apply to all important hedgerows growing on agricultural land, they will bring into scope some people who were not subject to cross-compliance, such as those who chose not to claim any direct payments or who have farms under five hectares in size.

There are two main requirements under these regulations. First, cutting or trimming hedges will be prohibited between 1 March and 31 August inclusive. This is to protect hedge-nesting birds and their habitats during the breeding season. There are some exceptions to this rule to give farmers and others flexibility where needed. The second requirement is to establish and maintain a two-metre-wide buffer strip alongside the hedgerow. This will protect the hedgerow and its root system from the effects of cultivation and the application of fertilisers or pesticides. Subject to certain exemptions, these activities will not be allowed within the buffer strip. The requirement for a buffer strip will not apply to fields which are two hectares or smaller.

We recognise that people may need time to establish their buffer strips where they do not already have them in place. We therefore propose that, in cases where a field has no buffer strip and is in crop production on 1 July 2024, the requirements will not come into force until that crop has been harvested. In all cases, the exemptions are needed to accommodate the practicalities of farming, or for health and safety-related reasons. They are largely the same as under cross-compliance. They are in place to ensure that we have the right balance between hedgerow protections and effective farming.

The regulations will be enforced on behalf of the Secretary of State by the Rural Payments Agency. Although the rules themselves will be familiar to many farmers, there will be a different approach to enforcement, with the emphasis being on being fair and proportionate. The Rural Payments Agency will take a primarily advice-led approach to enforcement. This has been shown to be the best approach for bringing farmers into compliance in other regulatory areas. However, the Rural Payments Agency will also be able to use a range of civil sanctions and criminal proceedings for the worst-case scenarios. Such action will be proportionate to the damage caused.

Subject to parliamentary approval, detailed information on how the regulations will operate will be provided once the statutory instrument has been made. The Rural Payments Agency will also hold a public consultation on its proposed enforcement policy. I know that it is committed to taking a modern, pragmatic and proportionate approach, with advice and guidance at the forefront.

Although these regulations govern the management of hedgerows on agricultural land, we recognise the value of hedgerows in other locations. Officials are therefore working separately with stakeholders to consider how to support the sustainable management and protection of hedgerows more widely in future.

In conclusion, this statutory instrument will afford fuller protection to one of our countryside’s greatest assets, the hedgerow. That will, I hope, be widely welcomed. I beg to move.

[Baroness McIntosh of Pickering (Con)]

My Lords, I have only one small question for my noble friend the Minister, as we do not have too many hedgerows in north Yorkshire; we mostly have stone walls, which we could have a separate debate on another time.

I am intrigued by the Government’s response to questions posed by the Secondary Legislation Scrutiny Committee in its report. It transpires that the Government are now bringing within the remit of cross-compliance farms of less than five hectares but larger than two hectares. For what reason are we going down that path? Obviously, these are quite small farms. The fields that we used to claim on when we owned a couple of fields would have fallen into this category, I think. I no longer have such an interest, but I wonder why we have gone down the path of including farms of between two and five hectares. Does my noble friend the Minister not agree that this seems like a lot of administration for such small farms?

[Baroness Young of Old Scone (Lab)]

I have been having sleepless nights about this, noble Lords may be pleased to hear. I was always a great fan of cross-compliance. It was quite a low-key instrument; nevertheless, it could be deployed. Of course, hedges are vital for wildlife and for carbon. They provide linear routes through our landscapes and join up patches of habitat. Filling the gaps in hedges, for example, is really important, for all these reasons.

Turning to my anxiety, it took ages to establish whether there was going to be a statutory instrument to fill the gap left by the demise of cross-compliance, and it then took some time for that to come forward. In a way, my great regret is that we have not used this opportunity. For heaven’s sake, the benefits of leaving Europe are few enough, but improving the situation for hedges would have been one of them. I would have preferred it if the Government had removed the three existing exemptions: for fields under two hectares, for hedges younger than five years and for the no-cutting period. When you look at the consultation, you see that there was not really much support among the farming community for retaining them. This could have been an opportunity absolutely to re-recognise the value of hedges, particularly in fields of under two hectares, and the importance of hedges younger than five years having protection from the beginning.

Apart from lecturing the Minister on this and lying awake at night worrying about it, I simply want to ask the Minister for four things. First, will he re-examine these exemptions? We have this wretched statutory instrument, and let us get the damn thing in because, at the moment, there is no protection for these hedges; but there is an opportunity here to improve on what Europe is doing and re-examine the exemptions.

Secondly, there should be a real proposition to extend the no-cutting period beyond even that in the instrument. My own wildlife trust, of which I am patron—I declare an interest—the Wildlife Trust for Bedfordshire, Cambridgeshire and Northamptonshire, has done a big hazel dormouse project that shows that there are multiple active nests during the period from September to October. If hedges are cut at that point, it prevents the population really thriving, and this is a very threatened species.

Maintaining hedges and not cutting them for even longer provides valuable berries and other food for winter wildlife and, as the Minister said, for farmland birds that are really in decline, such as the turtle dove, linnet, cirl bunting and yellowhammer. Bedford used to be the yellowhammer capital of the world, as far as I could tell, and you would be very hard put to find one at all now. In these species, late broods are disproportionately important. If they can get a third brood away, the population has a greater chance of increasing rather than standing still or declining. Again, extending the no-cutting period is something farmers would appreciate.

Thirdly, I ask the Minister to think about two matters not connected to hedgerows, but whereby we lose as a result of losing cross-compliance: water body buffers and soil erosion conditions, which are absolutely vital. They are hot in the public mind at the moment, particularly in the light of water pollution. Will he undertake to look at them and produce statutory instruments to reinstate them?

Lastly, I know that the Minister likes to tell me when I ask him things that are not particularly germane to the subject in hand, that are not his brief or are above his pay grade—or he will have another way of sending me away with a sore heart—but I hope that he might bump into his DLUHC colleagues and look in a concerted way at not just hedgerows that are subject to agricultural practice but those threatened by development. I know that one should not take personal examples as the norm, but I cannot help feeling that, in both the planning applications against which I have fought in the last two years, the local planning authority chose to ignore the hedgerow regulations in the planning advice. It destroyed hedgerows that not only are vital for carbon and wildlife but have huge historic lineage. If he were to bump into the noble Baroness, Lady Scott, in order to tell her that, it would be extremely helpful.

--- Later in debate ---

[Lord Douglas-Miller (Con)]

I have not looked at that and I appreciate that these dates are moving, but we have to start somewhere and those dates have been chosen for the moment.

The noble Baroness, Lady McIntosh, quizzed me on two-acre fields or less, and why they might be exempt. I hope everybody can understand that, if you have a smaller field, taking up a two-metre buffer zone around the edge of it will have a disproportionate impact. The Government recognise that and it came through pretty clearly in the consultation.

[Baroness McIntosh of Pickering (Con)]

Just to clarify, the question was why under five hectares was being brought in under the de minimis rule.

[Lord Douglas-Miller (Con)]

That was to try to include as many of our precious hedges as we can; that is still quite a big space. Again, through the consultation, it did not seem to cause a great deal of alarm, so it seemed perfectly sensible to include it.

The noble Lord, Lord Teverson, asked a number of questions about who is accountable, who is the regulator and who is the enforcer. The regulations will be enforced by the Rural Payments Agency on behalf of the Secretary of State. The Rural Payments Agency has a history of enforcing the hedgerow maintenance requirements under cross-compliance rules. It is well placed to develop and implement the new enforcement regime for all these regulations. The RPA will be taking an advice and guidance-led approach to enforcement.

On his supplementary question of who you should ring if you are driving along and you see someone doing damage to a hedgerow, I guess that question has always been there. Presumably, people will ring the police in the first instance if they see something going wrong, and they will guided by them to the appropriate agency. In this case, it is the RPA.

The noble Earl, Lord Russell, enquired about the definition of “important” hedgerows. The definition used for these regulations is designed to allow them to replicate as closely as possible the requirements for hedgerow management under cross compliance. For this reason, it was not practicable to use the same definition as is used in the Hedgerows Regulations 1997.

There were a number of slightly more detailed supplementary questions on which I will write to the noble Earl.

I am grateful for the thoughts and questions raised in today’s debate. They underline the value that so many of us place—

Agriculture (Delinked Payments) (Reductions) (England) Regulations 2024

Baroness McIntosh of Pickering Excerpts

Monday 20th May 2024 Grand Committee

[The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Lord Douglas-Miller) (Con)]

My Lords, I declare my interests as set out in the register.

This instrument continues the important agricultural reforms we are making in England. Through these reforms, we are investing in the long-term prosperity of the sector and the future of our precious environment—things which I know many in this House care deeply about. The instrument applies progressive reductions to delinked payments for 2024. Delinked payments were introduced on 1 January 2024 in place of payments to farmers under the basic payment scheme in England. We are phasing out untargeted subsidy payments, as they have held the industry back and done little to improve food production or the environment. We are doing this gradually, over our seven-year agricultural transition period in England. That period began in 2021, so we are now in the fourth year of the transition.

The Government first announced the reductions in this instrument in the agricultural transition plan, published in November 2020. We are applying the reductions to delinked payments in a fair way. Higher percentage reductions are applied to amounts in higher payment bands. We plan to make delinked payments in two instalments each year, which will help farmers with their cash flow.

By continuing gradually to reduce these subsidy payments as planned, we are freeing up money so that farmers can access a wide range of environmental land management schemes and grants to suit all farm types. At this year’s National Farmers’ Union conference, the Prime Minister reiterated our commitment to maintain total farm support at an average of £2.4 billion per year across this Parliament. Therefore, the money that is no longer being spent on untargeted subsidies is not lost to farmers; instead, it is being put to better use. It is being redirected to the sustainable farming incentive and other farming support, which help boost agricultural productivity and resilience, increase food security and deliver for the environment. Our new schemes are investing in the foundations of food security and profitable farm businesses—from healthy soils to clean water.

Earlier this year we updated payment rates in our environmental land management schemes, the average uplift being 10%. Some payment rates went up by significantly more: for example, species-rich grassland has risen from £182 to £646 per hectare.

This summer, we will launch up to 50 new actions, which will allow farmers to access scheme funding for things such as precision farming and agroforestry for the first time. The new actions give farmers even more choice about what they can do, especially those on moorlands and grasslands.

Nearly half of all farmers are now in one of our environmental land management schemes. So far, there have been around 22,000 applications for the sustainable farming incentive under our 2023 offer, and more than 21,000 agreement offers have been issued. There are now over 35,000 live Countryside Stewardship agreements—more than double the number since 2020.

The sustainable farming incentive can help to reduce costs and waste on farms, to make them more resilient and to improve food production by, for example, funding farmers to plant companion crops to help manage pests and nutrients, to assess and improve the health of their soil, and to grow cover crops to protect the soil between the main crops. We are designing our schemes so that they work for smaller farms. We have doubled the management payment for the sustainable farming incentive, which is now worth up to £2,000 for the first year of an agreement. This will help to attract even more smaller farms into the scheme.

Smaller farmers potentially have access to more income than they did before. Under the basic payment scheme, half the money went to 10% of the largest farms. Under the sustainable farming incentive, payments are based on the actions that farmers take, rather than simply the amount of land they have. This means that SFI agreements can produce more income than the basic payment for a typical farm.

Farmers taking part in the sustainable farming incentive are typically more than making up their lost basic payments so far. The value per hectare of applications so far is £148. This, alongside delinked payments for small farms this year—equivalent to £117 per hectare—adds up to more than the value of the basic payment scheme per hectare before the start of the agricultural transition. That is £233 per hectare under the basic payment scheme, versus a total of £263 under delinked payments and the sustainable farming incentive.

This year, we will make it even easier for farmers to access the funding by allowing them to apply for actions previously in Countryside Stewardship mid-tier and the sustainable farming incentive through one application process. In February, we announced the largest-ever grant offer for the agricultural sector, totalling £427 million. This includes a doubling of the investment in productivity and innovation in farming to £220 million this year. This provides support for farmers to invest in automation and robotics, as well as solar installations to build on-farm energy security. It also includes £116 million for slurry infrastructure grants and £91 million for grants to improve the health and welfare of our farmed animals.

We are providing a range of other support for farmers and land managers. This includes a third round of our landscape recovery scheme later this year. The farming resilience fund continues to provide free business support to help farmers plan and adapt their businesses. To date, more than 20,000 farmers have received this support.

In conclusion, the Government continue to back our farmers. We are investing in our new schemes and grants, which are helping farms and food production become more resilient. They also deliver better outcomes for animals, plants and the environment. We must press ahead with these reforms as planned. As ever, I am happy to take any questions. I beg to move.

[Baroness McIntosh of Pickering (Con)]

My Lords, I thank my noble friend for setting out the regulations, which, as he explained, follow on from the earlier regulations to delink payments. I congratulate Defra on the second Farm to Fork summit, which seemed to be well received last week, particularly the inaugural publication of a food security index and the commitment to introduce a five-year seasonal workers scheme, which will be extremely well received by fruit and vegetable farmers across the country.

On farms and food security, the summit recognises the unprecedented challenges all farmers have faced this year. This has been the wettest 18-month period—not just a 12-month or six-month period—since 1836. Also, unprecedented imports have led to competition on very unfavourable terms. For example, given that battery-cage production of poultry has been banned in this country—I do not disagree with that—it is unfair that our farmers face unprecedented levels of imports of battery cage-produced eggs and poultry from EU and third countries.

I would like to press my noble friend to explain how he expects small farms, which he mentioned specifically, to benefit from the provisions of these regulations. We in North Yorkshire are fairly unique in that 48% of our farms are tenanted; that is possibly replicated in County Durham, Cumbria, Northumbria and other parts of the north, and perhaps in the south-west. How does my noble friend expect tenant farmers to benefit, not just under the provisions in the regulations before us but under other provisions that have been announced this year?

I would argue that tenant farms are the backbone of the country. I mentioned the wet weather that we have had, which has had an impact not just on crop production. The AHDB’s figures find that the planting of oilseed rape is down 28% this year, while the planting of wheat is down by 15% and winter barley by 22%, but my noble friend will also be only too aware that livestock farmers have endured an incredibly difficult lambing period. Many have been unable to turn their stock out and have had to rely on feeding livestock, particularly sheep, at a much earlier stage in the year than they would have done otherwise. Cattle have been stuck in sheds with feed running low. I understand that this year straw will be like gold dust.

We all know that, because of the war in Ukraine and other factors, energy and other input prices remain volatile. This is an extremely difficult time, with farmers facing high input costs and very challenging sales prices. Against that backdrop, can my noble friend imagine anything else that the Government can do to extend help to tenant farmers? How does he imagine that small farms, family farms and tenant farms in particular will benefit from the provisions before us today?