Agriculture, Fisheries and the Rural Environment

Earl of Kinnoull Excerpts

Thursday 2nd November 2017 Lords Chamber

[The Earl of Kinnoull (CB)]

My Lords, I, too, add my congratulations to the noble Lord, Lord Plumb, on his amazingly wonderful valedictory speech. I found it a model of vigour and clarity. I doubt I could do that even today at a much younger age. I also congratulate the noble Earl, Lord Lindsay, on obtaining this timely debate. He gave a very scholarly survey of things. I shall pick up on just one of them and talk about forestry. I should declare my interests as set out in the register of the House, particularly those in respect of agriculture.

Forestry is, I regret, slightly the poor relation in the rural economy. I note that the five-year planting target to 2020 was 11 million trees, or 2.2 million trees a year. Forestry Commission figures for the first two years of this pledge came out in August and showed that in the first two years, in the aggregate, just 2.28 million tress had been planted. We are travelling at half speed. But the Climate Change Act 2008 means that we cannot afford to do so. I remind the House that the Act makes it a duty to ensure that the net UK carbon account for all six of the Kyoto greenhouse gases for 2050 is at least 80% lower than the 1990 baseline. The largest component by far of the six gases is of course carbon dioxide, and planting trees is self-evidently an easy and natural way of balancing CO₂ emissions.

There are many causes of this slow speed of planting, but my own take is that they really fall into two categories. The first is that the forestry grant offers and the economics generally are simply not attractive to landowners. Secondly, there are the high risks associated with plant health, pests, squirrels—a particular interest of mine—and deer. Taking the first of these categories, I was of course delighted to read policy 39 of the Government’s new Clean Growth Strategy. We have already heard of policy 38, concerning future agricultural support, but policy 39 says:

“Establish a new network of forests in England including new woodland on farmland, and fund larger-scale woodland and forest creation, in support of our commitment to plant 11 million trees, and increase the amount of UK timber used in construction”.


Could the Minister expand on this admirable policy or tell us when we might expect to hear more?

In terms of the second of these categories, I hope the House is aware how much the Minister is doing to help. I visited the Animal and Plant Health Agency facility outside York again 10 days ago for a conference on all these matters. Ninety-nine people from all over the UK were there, and the full range of innovative and world-class research that the UK and especially APHA are undertaking was discussed. For me, in my role as chairman of the UK Squirrel Accord, it was especially heartening to hear of the great strides being made in the science of grey squirrel fertility control, which ultimately will protect our broad-leaf trees from ring-barking by this invasive alien species, which kills young trees. But as I said, that is just one strand of much of the research that is going on, and the Defra family should be warmly congratulated on its hard work in all areas of research. It would be heartening for all involved, in whatever capacity in these battles, to hear from the Minister about his own determination and resolution in these areas.

In closing, I want to cite Action Oak. This initiative was launched just 10 days or so ago in the River Room. It is a determined, UK-wide partnership of governmental, voluntary and private sector bodies working together to seek to address the multiple problems that face our iconic national tree species. For instance, they will get communication going together and commission common research. It is a wonderful partnership concept and a very commendable model. Could the Minister tell us whether this type of public/private partnership approach is one that he sees as useful in the wider context of the forestry and agricultural sector?

Brexit: Agriculture and Farm Animal Welfare (European Union Committee Report)

Earl of Kinnoull Excerpts

Tuesday 17th October 2017 Lords Chamber

[The Earl of Kinnoull (CB)]

My Lords, it is a great pleasure to follow for the first time my noble friend Lord Vaux of Harrowden after his excellent and fluent maiden speech. He brings to the House not only expertise in agriculture but strong credentials both as an accountant and as someone who has held senior positions in the software industry for almost two decades, in both the UK and Asia. At the weekend, I spoke to a near neighbour of his in Galloway. In praising my noble friend’s diplomatic skills, this neighbour suggested that one of his toughest assignments, indeed achievements, has been to bring harmony and order to an important local entity that he chairs. I speak of course of the Fleet District Salmon Fishery Board—the source, no doubt, of a lot of local argy-bargy. I look forward very much to hearing his many contributions to the House in the years to come.

I declare my interests as set out in the register of the House, especially those in relation to agriculture, and remind the House that I am also a member of the European Union Select Committee. I too congratulate the noble Lord, Lord Teverson, on the barn-storming speech he made earlier. It was the most wonderful survey of what has gone into these two very powerful reports in this important debate.

I will make three points tonight and confine myself to the Brexit: Agriculture report. All these points relate to resources. The first concerns seasonal workers, and here the ground has been prepare by the noble Lords, Lord Teverson and Lord Rooker, and my noble and learned friend Lord Hope of Craighead. I live in Perthshire, surrounded by soft fruit farms, and am active in organic vegetables. I can confirm that the local farms active in these sectors, including us, use significant numbers of seasonal workers, almost all of whom come from EU 27 states. I repeat the invitation of my noble and learned friend Lord Hope, and associate myself with all his words, and ask the Minister to come to Perthshire, where I will give him a personal tour of the situation so he can see how strong these businesses are and how much we depend on these seasonal workers.

The report went into the science of this. Paragraph 253 records that Queen’s University Belfast estimates that, UK-wide, this seasonal workforce is 80,000 strong in horticulture alone, 98% of whom are from the EU 27. Paragraph 264 of the report goes on to say that:

“Many workers in the agricultural sector are often regarded as ‘unskilled’, but are in fact extremely skilled at sector-specific tasks such as crop handling and harvesting”.


I know only too well how true this is. I was, therefore, initially delighted to read in the Government’s response that:

“Access to a sufficient and appropriately skilled workforce is essential for the whole food chain, and we welcome the Committee’s recognition of the importance of this issue”.


However, I was baffled later on in the Government’s response to read:

“For seasonal workers, the Government has stated that it does not believe that there is sufficient evidence to introduce a new Seasonal Agricultural Workers Scheme in at this moment. We keep this position under careful, ongoing review”.


I regret—and here I concur totally with the noble Lord, Lord Vaux—that these words have sent a shiver down the spine of those businesses which use seasonal agricultural workers and their investment sentiment is accordingly very poor—and it is very poor in the very agricultural sectors that have been responsible for so much of the growth in agricultural GDP in recent times. “Why would one invest in a climate of such future workforce uncertainties?” is essentially the question being asked at the farm tables, in Perthshire for sure and, I have no doubt, elsewhere. I would be grateful if the Minister would comment on all of this and tell us whether this position is changing and, if not, what extra evidence the Government need in order to change their mind.

Moving to my second point, as I believe the Government will conclude that a new SAWS is not only necessary but very much in UK PLC’s interests, I hope that such a new scheme will learn the lessons of the old one. An example here would be the need for flexibility on visa end dates. The old SAWS was clear that, when the time was up for a seasonal worker, he had to go home. This was unhelpful in the agricultural sector where harvests can be late unexpectedly, leading to wholly unnecessary problems.

A more important example for today is the fact that forestry was not included in the old SAWS. Earlier today in the River Room, the Minister was launching Action Oak. This vital initiative unites all the relevant UK bodies in working together in the face of the multiple disease, pest and squirrel threats to trees—particularly oak trees—and, ultimately, of course, to energise landowners and land managers to plant. It is a milestone in helping to protect our countryside and environment. A small part of this milestone will involve the use of seasonal forestry workers. Accordingly, I ask the Minister to confirm that the needs of the forestry industry will form part of the careful, ongoing thinking that the Government are doing about seasonal agricultural workers, as I referred to a moment ago,

In closing, I move to my third point. The report sets out between paragraphs 277 and 283 why Defra needs considerably more resources, especially additional staff. The Government response on 29 June stated:

“The resourcing of EU exit work is a key priority of the Department and is subject to on-going assessment. Work continues to identify the number of dedicated posts required in the long-term to meet the demands of EU Exit”.


In other words, “Don’t know about that”. I wonder whether, three and a half months further on, the Minister could update us on how the thinking is on whether Defra really has enough resources. I know that this House would press strongly for resources to be given to Defra at this vital time.

Throughout this debate there has been a common theme of the importance of the agricultural sector to our nation and of it, and indeed Defra, being properly resourced. I hope we will hear strong and positive news from the Minister who, as the whole House knows, understands all of these issues so well.

Flood Defences

Earl of Kinnoull Excerpts

Thursday 1st December 2016 Lords Chamber

[Lord Spicer (Con)]

My Lords—

[The Earl of Kinnoull (CB)]

My Lords—

[The Lord Privy Seal (Baroness Evans of Bowes Park) (Con)]

My Lords, it is the turn of the Cross Benches.

[The Earl of Kinnoull]

My Lords, I am grateful. I declare my insurance and farming interests as set out in the register of the House. Does the Minister agree with me on two points? First, Flood Re is very much in its start-up phase—it began trading only in April this year, and 53,000 policies is, in insurance terms, not very many—and the concept will really be proven when the first claims are successfully settled and paid. Secondly, once that is done, however, it would be sensible for the Government to engage the relevant parties in conversation about extending the concept of Flood Re—which is different from Flood Re itself—to small businesses, which I think would be greatly to the benefit of this country.

[Lord Gardiner of Kimble]

My Lords, I am conscious of the noble Earl’s experience in the insurance industry, but it is fair to say that Flood Re is financed to cover up to £2.1 billion in claims. To give a sense of scale, that is seven times worse than the flooding in 2007. I hope that the BIBA product will advance further understanding of how best businesses, and small businesses in particular, can avail themselves of what the noble Earl described: a Flood Re-concept policy.

Agricultural Sector (EUC Report)

Earl of Kinnoull Excerpts

Tuesday 22nd November 2016 Lords Chamber

[The Earl of Kinnoull (CB)]

My Lords, it is a pleasure to follow the noble Lord, Lord Teverson, who, as ever, was energetic and interesting. I declare my interests as set out in the register of the House, and in particular as a recipient of EU farm subsidy, both personally and as a trustee of the Blair Charitable Trust.

I also congratulate the noble Baroness, Lady Scott, her committee and their clerking staff on a very thought-provoking and excellent report. I note that all the issues teased out in the report are still very much live following the June vote. It is a wide-ranging report, but I shall make just three points tonight.

The first is in respect of recommendation 4, which would see a scheme that enables farmers,

“to save in times of plenty and withdraw in times of need”.

It was heartening to read in the Government’s response what I certainly interpreted as general enthusiasm, and certainly what seemed to be praise, for the Australian farm management deposits scheme, which goes a good deal further in providing support to protect farming than our own current tax averaging measures.

Of course, there is another volatile business operating in the UK, which has done so for hundreds of years, that is important to Britain and which has an excellent method of allowing participants to save in times of plenty: my own alma mater, Lloyd’s of London. The personal reserve funds system has been successfully in place for decades. I cannot help but think that something closer to this, rather than the tax averaging scheme, would be immensely beneficial to the farming community. It is well understood by the Revenue, and I dare say it is understood by one or two farmers as well. Can the Minister confirm that this analogous and successful situation will be considered when—and I quote from the Government’s response to the report—

“Going forward, the Government will work with industry to develop new arrangements for agricultural support”?

My second point relates to recommendations 7 to 9, which are all about new financial tools. I have spent a lifetime in the City surrounded by financial tools, and therefore I have a pretty clear idea about who often makes the money out of these tools. I am of course very worried about that. I therefore plead that any tools that are dreamed up are very simple. I must say that the vast majority of farm offices will be like ours—ours is in the kitchen and takes place usually on Sunday mornings; it is not well set up for analysis or a complicated financial tool. I certainly would be worried that these tools could be vehicles for egregious profit by the private sector. In other words, we do not want the lions of Goldman Sachs to eat the shepherds of Perthshire.

I observe that there are already two types of volatility to be addressed. The first is market volatility. I feel that the personal reserve scheme, similar to the Australian one and indeed our own Lloyd’s arrangements, would be a very good start for dealing with that. The other volatility relates to natural perils, which is a fancy way of saying storms and floods—another area I have spent a lifetime fiddling around in.

About 10 days ago, the Minister and I had a brief exchange about Flood Re, a new government-backed scheme that provides effective and cheap insurance to private home owners in flood-prone areas. The scheme only started in April this year, and the Minister has reported to the house that 53,000 policies have already been ceded to Flood Re. It is a collaborative system between the insurance industry and government. It is very interesting and, at this early stage, appears to have borne fruit. The noble Baroness, Lady Scott, touched on my second point, but would the Minister agree with me concerning Flood Re, and would he feel that this might be the basis of an approach for the farming community going forward to manage the natural perils risk?

My third and final point concerns recommendation 11. Here, the noble Baroness, Lady Byford, was ahead of me a bit. The recommendation concerns agricultural research. I note again the very warm statements in the Government’s response, and I commend them for that. I am a great believer in research.

This evening, there has been no mention of the forestry industry in the UK, with its more than 40,000 jobs, and adding, as it does, more than £1.7 billion to the UK economy every year. I should say that, only a few months ago, I would have had to declare an interest as a member of the council of the Royal Scottish Forestry Society, but I came off that just over a year ago. This industry, which I love, is greatly threatened by tree disease, pests and the grey squirrel. I have to declare another interest as the chairman of the United Kingdom Squirrel Accord, which consists of 34 UK bodies including the Governments, the main governmental bodies, and voluntary sector and private bodies, and is trying to deal with the squirrel problem. Trees between the ages of 10 and 40 are being killed off by grey squirrels ring-barking trees, and this affects up to 70% of plantations. This has effectively stopped forestry plantations of broad-leaf trees on a commercial basis in the south-east of England. The disease, pest and grey-squirrel issues are examples of issues that we can respond to through scientific research—something that I know the Minister is very well aware of and I have had many discussions with him about it.

So I close by asking the Minister whether he agrees with me about the importance of recommendation 11, and whether he would give some hope to the forestry industry that their case for research money to deal with their threats is under consideration.

Flooding: Defences

Earl of Kinnoull Excerpts

Tuesday 8th November 2016 Lords Chamber

[Lord Gardiner of Kimble]

My Lords, that is precisely why—as set out in the letter I wrote and the Environment Agency paper Winter Ready 2016—the Environment Agency is extending flooding-warning service to more communities and improving the range of digital services on GOV.UK, to help people take action to minimise the impact. I very much hope the noble Lord will think of going to the meeting on 29 November, when the Environment Agency and other departments will be in Parliament so that all these matters can be discussed in more detail.

[The Earl of Kinnoull (CB)]

My Lords, will the Minister provide the House with an update as to whether Flood Re, the insurance solution which can provide affordable insurance for homes, is a success in its first year of operation, and what plans the Government might have to extend Flood Re to small businesses?

[Lord Gardiner of Kimble]

My Lords, the first thing to say is that 53,000 home insurance policies are now backed by Flood Re. In fact, 40 insurers representing 90% of the market are now participating in Flood Re. I am very pleased that the insurance industry has responded so enthusiastically. We want to see how that works first. It seems to be extremely successful. It has meant that policyholders have reasonable premiums. We will certainly look at any future issues.

Farming: Impact of Brexit

Earl of Kinnoull Excerpts

Thursday 21st July 2016 Lords Chamber

[The Earl of Kinnoull (CB)]

My Lords, I declare my interests as set out in the register, particularly my own farming interests and as a trustee of the Blair Charitable Trust and its 70,000 acres. I too congratulate the Minister on his new appointment. Everyone that I speak to very much feels as I do: this is a case of round hole and round peg, and it is good news for the House. I also congratulate the noble Baroness, Lady McIntosh of Pickering, on yet again enabling us to debate rural and farming affairs. I say again that I do not think we do enough of that in this House. The balance is not quite right, and I urge the usual channels to seek to address that.

I was only going to make one point today: the necessity of an early and clear communication to, and reassurance of, the farming community, particularly post-Brexit, in respect of the subsidy regime and foreign seasonal labour, so ably already put by the noble Baroness. I thought, however, that it was worth reporting on some of the many discussions I have had in farmhouse kitchens—and, in one instance, on a cricket pitch—about what Brexit means for farming. I shall distil those discussions down to three main points.

The first discussion, which was on the cricket pitch, was with a soft-fruit farmer. His business is of course labour-intensive and capital-intensive; Perthshire soft-fruit farming benefits from perfect conditions. He in particular needs foreign seasonal labour, which tends to come from poorer EU countries. He puts them up on a full-board basis, as do many other people in the area, and the arrangement is very satisfactory to everyone. His business is going so well that he would like to invest in increasing it. That is quite expensive, as it costs around £20,000 an acre to put up polytunnels and produce satisfactory irrigation and so on. He would have to invest in the accommodation as well. However, he is not going to do that because at the moment he is not confident of the availability at similar cost of skilled EU labour in future.

The second conversation was with a gentleman who has a successful livestock business, both sheep and cattle. He was thinking of an investment in his cattle court of around £100,000. He was not going to proceed, either, because he was not confident that the subsidy regime would be there in the future, and if the subsidy was removed from his future cash flow the returns would be so thin as to not make the investment worth while. Therefore he was holding off. Those are both examples of what I call loss of opportunity.

My final example is more worrying, because it is an example of damaging the existing business. This discussion was with the manager of a successful mixed organic farming business. This manager, whom I have known for many decades, was sitting down to fill in the forms for the overdraft renewal for his business. He was particularly concerned about the three-year cash flow that has to be included in those forms because he did not know how to fill in the third year. He had also had a discussion with his relationship manager at his major clearing bank and was under the impression that the bank was out to reduce his overdraft limit because of the uncertainties surrounding the future cash flow. If that is bank policy, it means that a constraint on cash and overdraft facilities for successful farms—and this is a deeply successful farming business—are being put in place, which damages our industry and is particularly not welcome when farm prices at the farm gate are so disappointing.

In closing, I therefore ask something similar to that asked of the Minister by the noble Baroness. When does he feel it will be possible to give clear assurances to the farming community post-Brexit, first, on the foreign seasonal workers point, and secondly, on the subsidy regime?