Agriculture Bill

Debate between Earl of Kinnoull and Lord Gardiner of Kimble

Report stage & Report: 2nd sitting (Hansard) & Report: 2nd sitting (Hansard): House of Lords
Thursday 17th September 2020 Lords Chamber

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

My Lords, I thank all noble Lords for their contributions to this debate. I will take Amendments 43 and 44 together. I would like to reassure your Lordships that we recognise the importance of the issues that these amendments raise. Farmers and farming households make a valuable contribution to our national life, and we recognise that the needs of farming households may change as we move away from the common agricultural policy.

As set out in their manifesto, the Government intend to introduce the UK shared prosperity fund to replace EU structural funds. The manifesto also stated that it will, at a minimum, match the size of those funds in each nation, which was reiterated by the Chancellor in the last Budget. The final decisions about the quantum and design of the funding will take place after a cross-governmental spending review.

The Government have made a long-standing commitment to ensure that all policies are rural proofed—that is, ensuring that policy outcomes work in rural areas. This includes the development and delivery of the UK shared prosperity fund, on which Defra and MHCLG officials are working closely. In advance of the introduction of the UK shared prosperity fund, £60 million of funding will continue to flow to rural businesses via the final tranche of the growth programme, which the RPA is currently assessing.

The fund will play a vital role in supporting rural and coastal communities in recovery and renewal from Covid-19, and our expectation is that the growth programme and LEADER elements of EAFRD will be a component of the fund. This was set out in a letter from the Defra Secretary of State to the chair of the EFRA Select Committee on 7 September. Defra officials continue to work closely with the Ministry of Housing, Communities and Local Government, which leads on the fund’s development, to ensure that its design takes account of the dynamics of rural economies and particularly the challenges faced by rural communities, as well as the opportunities that I believe rural communities have. We have been in contact with MHCLG Ministers and I can assure your Lordships that MHCLG recognises the importance of these considerations.

I fully recognise the importance of reassuring rural communities and farming households about the future of local growth funding. The Government will look to set out their national approach to local economic recovery and devolution through a White Paper expected in the autumn. We firmly believe that the best way to make progress is to continue to work collaboratively at local and national level. The MHCLG has established an economic recovery working group, which meets regularly, bringing together a range of local growth partners to work on emerging themes and concerns across the country, including those relevant to rural areas. This includes representatives from rural local enterprise partnerships and local authorities.

If new socioeconomic support programmes were to be operated under Clause 16, they would have to operate under broadly the same framework dictated by the existing CAP. Clause 16 provides the Secretary of State with the power to modify or repeal retained EU legislation relating to rural development in England. This clause will not be used to introduce any new schemes, as they will be covered under Clause 1.

I very much hope that the noble Lord, Lord Cameron of Dillington, and the noble Earl will accept my confirmation that the UK shared prosperity fund will provide great opportunities for growth and investment in rural communities and will include the successor for the growth programme and LEADER elements of EAFRD. I believe this is a cause we all share and hope that, on that basis, given the explanation of the work we are undertaking between the two departments and the imperative of rural proofing, the noble Lord will feel able to withdraw his amendment.

[The Deputy Speaker (The Earl of Kinnoull) (Non-Afl)]

I have received a request to ask a question from the noble Earl, Lord Devon.

--- Later in debate ---

[Lord Gardiner of Kimble (Con)]

My Lords, I shall speak also to Amendments 46, 107, 110, 111, 122, 123, 124 and 125 in my name. Following new legal advice from the European Law Group and the Office of Parliamentary Counsel, these technical amendments are being tabled to put beyond doubt that a body of retained EU law relating to multi-annual programmes under rural development and common market organisation will be created at the end of the implementation period, where this is not created automatically by virtue of the interrelationship between the withdrawal agreement and European Union (Withdrawal) Act 2018.

Clauses 14, 15, 16 and their equivalents in the Welsh and Northern Irish schedules all rely on a body of retained EU law being created on implementation period completion day that can then be applied in domestic law and modified as required. Article 138 of the withdrawal agreement means that rural development programmes and some parts of the common market organisation will continue to operate under EU law after the end of the implementation period. However, Section 3(2)(a)(bi) of the European Union (Withdrawal) Act 2018 prevents EU legislation that is directly applicable in domestic law as a result of the withdrawal agreement under Section 7A of EWA also becoming retained EU law. I am sorry about this, but I want to go into some technical detail so that it is very clear to your Lordships.

This created a legal doubt as to whether the legislation governing the relevant rural development and CMO aid schemes would roll over to become retained EU law. These amendments therefore put that question beyond doubt by ensuring that a body of retained EU law relating to multi-annual agreements and programmes in rural development and CMO will be created at the end of the implementation period. They also provide a payment power to continue paying existing holders of agreements or programmes once the EU funding ends. This power to pay does not depend on modifying retained EU law. Such a power is necessary to ensure domestic funding can step in when existing EU budgets are exhausted in circumstances where these agreements and programmes continue to be regulated under the withdrawal agreement.

As I said, these are technical amendments required to ensure the Bill works as it was originally intended, so that modifications may be made to existing programmes where appropriate, simplifications and improvements may be made to schemes and scheme beneficiaries can continue to receive payments. These government amendments are supported by, and made with the approval of, the devolved Administrations. That is most important and the schedules for Wales and Northern Ireland are at their request. I also emphasise that there is no change to the policy intent of Clauses 14, 15 and 16. I beg to move.

[The Deputy Speaker (The Earl of Kinnoull) (Non-Afl)]

I call the noble Lord, Lord Marlesford.

Agriculture Bill

Debate between Earl of Kinnoull and Lord Gardiner of Kimble

Committee stage & Committee: 6th sitting (Hansard) & Committee: 6th sitting (Hansard): House of Lords
Thursday 23rd July 2020 Lords Chamber

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

My Lords, what an interesting debate we have had. I am most grateful to all noble Lords who have contributed.

On Amendment 263A, Defra Ministers meet on an almost monthly basis with counterparts from the devolved Administrations as part of the inter-ministerial group for EFRA. Any potential changes to food standards would be discussed here first. I am also pleased with the progress officials have made in developing the food information to consumers, fish labelling and food compositional standards common UK framework. The framework will focus on consensus-based decision-making but will also include dispute prevention and resolution mechanisms.

On Amendment 267, the powers in Part 6 allow for regulations to be made to ensure compliance with the United Kingdom’s obligations under the WTO agreement on agriculture. The regulations therefore set out procedures and arrangements to ensure that the UK as a whole complies with existing obligations under an international treaty. We have a bilateral agreement with the Welsh Government on the making and operation of regulations under Part 6 of the Bill. We have offered to extend this agreement to the Scottish Government and DAERA Ministers in Northern Ireland.

In addition, my honourable friend the Minister for Farming, Victoria Prentis, committed in the other place to consult with the devolved Administrations on the making of regulations under Part 6. I say in particular to my noble friend Lady McIntosh of Pickering that draft regulations have already been shared with devolved Administrations and strong and productive discussions are continuing. Defra officials have been working closely with them; this is another important and positive point.

On Amendment 284, the powers taken by Welsh Ministers through the Bill are intended as a temporary measure while the Welsh Government continue to develop their own legislation. Financial assistance under Clause 1 may be given by the Secretary of State only in relation to England. Welsh Ministers are not taking similar powers in this Bill to operate or introduce new financial assistance schemes. It is the Welsh Government’s intention that these powers will be provided for by a future Senedd Bill.

On Amendment 283, Schedule 5 contains powers requested by the Welsh Government to simplify the existing schemes and improve them for farmers, not to change or reduce standards. The underlying animal welfare standards to which all farmers must adhere are not found in this domestic payments scheme legislation; rather, they are found in underlying domestic and retained EU legislation. Therefore, these underlying protections will continue for all.

I found Amendment 289 an interesting element of our discussions. The Northern Ireland Assembly debated and agreed the legislative consent Motion on 31 March 2020. The DAERA Minister made it clear to the Northern Ireland Assembly in that debate that he did not support a sunset clause at this stage with respect to Northern Ireland provisions in the UK Agriculture Bill. It is the Government’s very strong view—I must say, we have been reminded by all noble Lords who contributed of the importance of this—that we must respect the devolution settlement. I find it difficult to construe how the Government could accept the amendment proposed and respect the desire and wish of the DAERA Minister and, by that token, the Assembly. Therefore, we do not believe that Parliament should seek to override the constitutional view already agreed by the Assembly on 31 March 2020. If we are to be consistent in our respect for the devolution settlement, it is difficult to believe that your Lordships or the Government should seek to impose something on a devolved Administration when they have given their legislative consent Motion to legislation. To be very clear, my noble friend and I are honest brokers for both the Welsh Government and the Northern Ireland Assembly in the schedules before us.

On Amendments 290 and 291, the UK Government have created IMG EFRA, as I have said, and a series of specialist official-level working groups to deliver effective joint working with the devolved Administrations. This has proven a highly successful governance mechanism. The UK Government have collaborated closely with each devolved Administration on a UK-wide framework for agricultural support based on the Joint Ministerial Committee on EU Negotiations principles agreed in 2017. The framework is planned to cover policy areas such as agricultural support spending, crisis measures, public intervention and private storage aid, marketing standards, cross-border farms and data collection and sharing. I think the point about cross-border farms was raised in particular.

Good progress is being made on the framework. The UK Government shared their first draft with officials from the devolved Administrations this February. Since then, there have been continuing discussions with officials in the devolved Administrations on a common framework for agricultural support. In our view, placing additional statutory requirements in this area risks disrupting an ongoing process of what has been described as excellent collaborative working, which is working extremely well. It would also create inconsistency with wider framework discussions.

I think the noble and learned Lord, Lord Wallace of Tankerness, first used the word “sensitivity”. We are all of a view that we must deal with these matters with sensitivity. When I meet fellow Ministers from all parts of the United Kingdom, I see this as an endeavour of equal partnership. We believe that it is inappropriate for the UK Government to seek to legislate on frameworks, certainly without prior discussion and consideration with the devolved Administrations.

I also say to the noble and learned Lord, Lord Thomas of Cwmgiedd—and I repeat this from my opening remarks on Tuesday—that we remain wholly committed to seeking legislative consent for all provisions that engage the convention in Scotland, Wales and Northern Ireland. That is why I was pleased to make those amendments.

The noble Baroness, Lady Wilcox of Newport, and other noble Lords raised the budgets for the devolved Administrations. Intra-UK funding is being discussed as part of current Treasury settlement discussions with Defra. Her Majesty’s Treasury will discuss this directly with the devolved Administrations. I absolutely understand the importance of certainty on funding for all parts of the United Kingdom and, from the visits I have had, am well aware of the importance of farming to all parts of the United Kingdom, and its importance in terms of UK internal markets.

To answer my noble friend Lord Empey on the Northern Ireland border, the Government are working very closely with the Northern Ireland Executive to ensure unfettered market access between Northern Ireland and Great Britain while meeting our obligations under the Northern Ireland protocol. I also say this to my noble friend, because of my biosecurity interest: as an epidemiological unit in itself, the island of Ireland has some advantages. Also, we already have requirements, as does Northern Ireland, as part of that unit. Obviously, we want to make sure that the biosecurity arrangements for the island of Ireland are as strong as they can be, but our working with Northern Ireland will be absolutely imperative for the frameworks. The success of that is where I believe we will find a satisfactory resolution for all parts of the United Kingdom. I say that as a unionist.

The UK Government believe in close collaboration in the coming months to agree and implement administrative frameworks to set out future working and co-ordination on agriculture. The noble Baroness, Lady Wilcox of Newport, asked when that will happen; the answer is, by the end of the transition period. We think that close collaboration is, to pick up on a word used earlier, the respectful way to work. I am conscious that the relationship between all four parts of the United Kingdom needs to be strong and positive. If it is not, it makes things much more difficult.

I want to bring forward the fact that the relationship that all of us as Ministers in Defra have with our colleagues in the devolved Administrations is strong and positive. There is a common endeavour to ensure that we have vibrant agriculture and strong food production, and that we make a success of it all and make a success of the United Kingdom.

[The Deputy Chairman of Committees (The Earl of Kinnoull) (Non-Afl)]

My Lords, I have received three requests to speak after the Minister from the noble Lord, Lord Foulkes of Cumnock, and the noble and learned Lords, Lord Wallace of Tankerness and Lord Hope of Craighead.

Japanese Knotweed

Debate between Earl of Kinnoull and Lord Gardiner of Kimble

Thursday 16th May 2019 Lords Chamber

[Lord Gardiner of Kimble]

The noble Lord raises something really important. A very good practice manual has been published as part of a RAPID LIFE project, showing the varying ways in which this can be dealt with. They all have their issues because of the rhizome’s ability to continue, even dormant, for 20 years. Glyphosate, properly used by trained people—I emphasise “properly”—can kill Japanese knotweed in about two or three years. Biocontrol would obviously be preferable for reducing the aggressiveness of the growth, but there is a whole range of issues. I am happy to share the manual with the noble Lord.

[The Earl of Kinnoull (CB)]

My Lords, I draw attention to my interests in the register. Of course, knotweed is not the only invasive alien species around. This is Invasive Species Week; indeed, the Minister has been seen in the newspapers digging up skunk cabbages. Can he confirm that the Government are intensifying their efforts to combat invasive alien species in general, and in particular the grey squirrel, which is doing so much, so distressingly, to kill our broad-leaf trees?

Flood Defences

Debate between Earl of Kinnoull and Lord Gardiner of Kimble

Thursday 1st December 2016 Lords Chamber

[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.

Flooding: Defences

Debate between Earl of Kinnoull and Lord Gardiner of Kimble

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.

Flood Reinsurance (Scheme and Scheme Administrator Designation) Regulations 2015

Debate between Earl of Kinnoull and Lord Gardiner of Kimble

Tuesday 27th October 2015 Grand Committee

[Lord Gardiner of Kimble (Con)]

My Lords, I am pleased to introduce the regulations necessary to implement Flood Re. The increasing sophistication of flood risk modelling employed by insurers, in combination with expected increases in extreme weather events, means that many households in high flood risk areas increasingly struggle to afford insurance. We are seeking to address this: Flood Re will ensure households in high flood risk areas are protected from spiralling insurance premiums and excesses over the next 25 years.

Flood Re is a responsible, proportionate approach to the challenges of flooding, which can be devastating to those affected. However, there are many different aspects to reducing the terrible impacts of flooding on people; Flood Re will form just one piece of the UK’s flood risk management. Many others must play a role in managing flood risk, including householders themselves, local authorities and landowners.

There are two sets of regulations to be debated today—first, the funding and administration regulations, which set out the framework within which Flood Re will operate and how the levy will be calculated. They outline the technical aspects of the scheme. Secondly, the designation regulations, which designate the scheme and administrator and enable the Flood Re scheme to begin operation. These draft regulations were subject to extensive public consultation and were developed by working closely on the detail with specialists from the Association of British Insurers, the Lloyds market and the financial regulators.

It is important that the regulations are debated now in order that Flood Re can sign contracts with individual insurers this autumn in preparation for becoming operational by April 2016. Flood Re will need to be authorised by the Prudential Regulation Authority before it can operate. The financial regulators, and the insurance industry, need certainty about the legislative framework within which Flood Re will work before authorisation as a reinsurer could be given. The financial regulator’s authorisation process is ongoing. We will check with the Prudential Regulation Authority that Flood Re’s application is still being considered as part of that authorisation process before signing the regulations. Although the financial regulators cannot provide a definitive statement on the likelihood of authorisation, this will provide an indication that the application is progressing.

Flood Re will be principally funded by a levy raised from relevant insurers, as defined in these regulations. The amount of each insurer’s levy will be based on its share of the UK home insurance market. The total primary levy to be raised from insurers will be £180 million, which we are assured reflects the level of cross-subsidy currently present in the market. Given the unpredictable nature of flooding and Flood Re’s solvency requirements, we have also provided powers to raise additional levy from insurers if it is needed.

The regulations set out constraints that Flood Re needs to operate within as the levy is expected to be classed as public money by the Office for National Statistics. Flood Re will operate independently as a normal reinsurance company regulated by the financial regulators. Because of its unique position, Flood Re is being set up as a bespoke arm’s-length body.

Flood Re will be directly accountable to Parliament. The regulations stipulate that Flood Re is required to lay its annual accounts before Parliament. Flood Re’s responsible officer will be accountable to Parliament for the financial propriety and regularity of the scheme. While Defra will remain accountable to Parliament for general policy matters relating to flood risk management, there will be no role for Defra’s Ministers or accounting officer in Flood Re’s day-to-day management.

While Flood Re is publicly accountable, it is owned and operated by the insurance industry. Flood Re will be required to manage itself within the normal requirements for regularity, propriety and value for money, and full parliamentary accountability. Flood Re will be audited externally. However, the National Audit Office will also be able to conduct value-for-money reviews of any of its activities, and report on them to Parliament.

The regulations set out that the prices that insurers may pay to cede policies to Flood Re, which we call the premium thresholds, are payable by insurers according to council tax bands. Benefits are targeted at the lower council tax bands and it is hoped that they will be passed to policyholders. The regulations require that Flood Re review the scheme, including the level of the levy and premium thresholds, at least every five years. Any changes to the levy would require amendments to the regulations via the affirmative resolution process. Defra’s Secretary of State may call a review of Flood Re at any point.

Flood Re will publish a transition plan within three months of the regulations coming into force. We expect this plan to indicate how prices may evolve during the life of Flood Re, and the measures that Flood Re may take to incentivise people to do more to manage their own flood risk. However, Flood Re, like all reinsurers, will only be permitted by financial regulation to carry out the business of reinsurance. Flood Re’s directors also have to be able to fulfil their prudential and fiduciary duties according to company law and financial services regulation. UK flood management depends on a complex arrangement of interweaving policies and interested parties, of which the insurance industry and Flood Re form only part.

In conclusion, I remind your Lordships why Flood Re has been established. We all recall the floods which many have experienced in recent years. Flood Re will provide the people of the United Kingdom with available and affordable flood insurance in a way that supports and complements wider efforts to reduce and adapt to flooding. It is expected that between 350,000 and 500,000 households at high risk of flooding will benefit from the Flood Re scheme. Flood Re has made significant progress, appointing its board and senior executive team ready to be considered for designation and authorisation by the financial regulators. These regulations are a significant step in the direction of helping people to manage the impact that flooding can have on their lives. It is for these reasons that I commend these regulations to the Committee.

[The Earl of Kinnoull (CB)]

My Lords, I apologise for being a minute or so late for that very eloquent introduction. Before welcoming these statutory instruments, I declare my interests as set out in the register, in particular the fact that for several years I was head of the division within the Hiscox group which wrote United Kingdom household insurance and for some years the CEO of the reinsurance company at the centre of the Hiscox group, which wrote many reinsurances of the players in the United Kingdom household insurance market.

These regulations are an excellent example of co-operation between the Government and the industry. It is not the first example, of course. There was one in the early 1990s when, following the two dreadful explosions in the City of London which caused immense damage and in which lives were lost, Pool Re was formed. Pool Re has been a success for the UK insurance market and the UK insurance industry.

It is worth pausing for a moment to consider the UK insurance industry. I am afraid that it is not at the glamour end of the financial services of the City, but it is a very strong industry and in a leadership position in the world. The London and international insurance and reinsurance markets alone account for gross written premiums of around £60 billion a year. The industry employs about 50,000 highly specialist staff, and it is this expertise in insurance and reinsurance which has come together with the Government to structure what is today Flood Re. Will the Minister join me in saying that there is much to congratulate the UK insurance industry on, in its world leadership and its strong, centuries-old reputation for consistently paying valid claims?

Flood Re provides the availability and affordability of flood insurance for flood-prone homes. We have at Hiscox lots of computer systems which can cause artificial floods on a computer screen. You can see just how many homes in recent times have become flood-prone. This is due both to planning policy and to geographical and climate changes. Essentially, the bet has become too big to place with the private insurance market. There are many examples of catastrophe insurance around the world which have become too big for the private markets. Flood Re represents a singularly appealing way of getting around the problem.

As we have heard, the scheme is aimed at 500,000 out of the 25 million or so homes in Britain, so quite a large number of homes are involved in it. On review, I feel that it is simple, secure and sensible. Will the Minister confirm something slightly different in terms of the review process, which is that it is the intention of the Government, particularly in the early years, to review progress of Flood Re and, if necessary, tweak matters to optimise the scheme?