English Horticultural Sector (Horticultural Sector Committee Report)

Lord Carter of Coles Excerpts

Friday 19th April 2024 Lords Chamber

[Lord Carter of Coles (Lab)]

My Lords, I start by thanking the noble Lord, Lord Redesdale, for his dedicated—the size of the report indicates that—and skilled chairing of the committee. It was a pleasure to work on this, not least because it brought to fruition the lifetime’s work of the noble Baroness, Lady Fookes, who has been a fundamental driver of change in the sector, which, as I hope we demonstrate, is of great significance.

What was interesting about the committee was that it took us into a wide range of issues and showed how difficult it is for modern government to touch every base. The first thing we hit was the elusive reality of joined-up government. It is practically impossible. If I had a pound for every committee meeting I have been to where people banged on about how one department does not talk to another, I would have a bit more money.

There were a large range of issues, some of which have been touched on—innovation, investment, cheap food versus food security, the environment and all those things. But with the time limit today, I will focus on a very narrow range of things.

The first thing that struck me is that this industry can grow substantially, and this country needs growth industries. One need only look 40 or 50 miles across the sea to the Netherlands to see a country about 17% of the size of the UK that has a horticultural sector that is five times greater. It can be done. The challenge we face is how to do it.

That leads me to the question of government. The Government’s strategy is non-existent. How can they not be enthusiastic about something that has such potential to grow? To add to that disappointment, I would be complimenting the Government if I said that their response to our report was anything other than totally anaemic. It does not help with anything that we want to achieve.

Why should we be doing this? What is the opportunity? It is best if I quote Sir James Dyson. His credentials enabling him to speak on this are that he has a large greenhouse, 760 metres long, in Lincolnshire, in which he has 1.25 million strawberry plants. He does all of that with heating from solar panels and anaerobic digestion. What he says is this:

“Sustainable food production and food security are vital to the nation’s health and the nation’s economy, whilst there is also a real opportunity for agriculture—


he says agriculture but I say horticulture—

“to drive a revolution in technology and vice versa… efficient, high-technology agriculture holds many of the keys to our future”.

That is what it is. We have the opportunity, so we need to look at technology. We cannot forever be competing with warm countries with long hours of sunshine and low labour costs. We need to get the technology right if we are to compete and deal with these key issues.

The committee was lucky enough to spend a day in Kent, on the Isle of Thanet, said to be the sunniest part of England. We saw two great exemplars. The first was an Anglo-Dutch joint venture growing tomatoes. It was brilliantly organised. It is, I think, the leading supplier of tomatoes to the UK and is world-class and competitive. Equally entrancing was a visit to a site a few miles away where a vertical farm had been built. It focused on producing leaves—that is, lettuces and things for supermarkets—in a really controlled environment which was pesticide-free, with minimal water and labour. It was absolutely fantastic. It did it on an amount of land which, to get the same output with conventional methods, would have to be 20 times greater. What is there not to like? Why are we not pushing and investing, and getting the Government to help in taking this forward?

So we know what to do and we have seen others do it. This sector has great innovative ability. People such as Sir James Dyson and the people on the Isle of Thanet are not in this because they want to be charities. We know how to do it. In response to the supermarkets’ continued pressure on margin, it will be only technology and innovation that get the right margin to supply the job.

We do need better training—the noble Baroness, Lady Fookes, touched on this—and the Government should be in that place. Frankly, I have never believed in the Government picking winners, but in this case I make an exception. The Government need to get behind this, but with a light touch: we do not want another bureaucracy, and we do not want another load of civil servants writing endless reasons why not. We just need to get on with it. So perhaps in conclusion the Minister might tell us whether he believes that some small part of the Defra underspend will be directed to this, as the Government have committed to the total amount of money going in during the lifetime of this Parliament.

Agriculture Bill

Lord Carter of Coles Excerpts

2nd reading & 2nd reading (Hansard) & 2nd reading (Hansard): House of Lords
Wednesday 10th June 2020 Lords Chamber

[Lord Carter of Coles (Lab) [V]]

My Lords, this is an important Bill and certainly a once-in-a-lifetime opportunity to reform the funding of agriculture in this country. It is confirmed by the number of noble Lords speaking in the debate, which is in contrast to the occasion when one of the Minister’s predecessors, Lord Walton, came to the House in December 1940 to make what he thought was an important speech only to find seven Members in attendance, their main interest being in the allocation of jam. I declare an interest as a farmer, with other rural interests. In the interests of time, I will touch briefly on three issues: security, standards and sustainability.

Agricultural subsidies are rife throughout the world and cost over $500 billion a year. Often, their purpose is to support rural economies and underwrite food security. Covid-19 has shown that in many areas, globalisation can lead to national shortages. While it has not dramatically affected the food supply here, it has been comforting to see how well the food supply chain has functioned in recent months—our thanks should certainly go to those who have kept the shelves full.

On food security, we are 60% self-sufficient but, despite the dramatic performance of our agricultural exports, we run an annual balance of payments deficit of about £24 billion. We welcome the review of sustainability and security but the question is, what level of self-sufficiency should the country aim for? I would be grateful if the Minister commented on that. Also, in the course of policy formulation, what attention is being paid to our ability to pay for the high level of imports that we sustain?

Many noble Lords have spoken eloquently about food standards, and we are absolutely clear—everybody I speak to is clear—that there must be no reduction in those. The joint Secretary of States’ letter yesterday offered some comfort. However, the key is to see how this is dealt with in the Trade Bill, and of course the Government’s intentions, as noble Lords have indicated, remain a matter of concern. The key will be the regulatory framework we put in place to oversee those, and as we work our way through the Bill and the amendments, we will get a better picture.

The sanitary and phytosanitary standards are more visible. One of the things we need to be aware of as we drive for more productivity and efficiency is that we do not want to drive standards down. We want to ensure that those who work in the production and, more importantly, the processing of food have the right working conditions and standards to do their jobs. We must ensure that those standards are maintained.

Finally, I come to the sustainability issue: getting the balance right between environmentally ambitious policies and the need to have a highly productive, quality agricultural sector. It is commendable that the Government have recognised that this will take time, and the transition period is very welcome. However, until we see details of things like the ELMS project, as other noble Lords have indicated, it makes it extraordinarily difficult for farmers to plan. Farming is a long-term activity, as is environmental investment, and the quicker we can see details of the success of the pilot schemes and understand the finer detail, the better we will be able to go forward. Similarly, on issues such as productivity and investment, we need to understand how this will come about and which sectors will be supported, how that money will flow through and how it will go over the coming seven years.

When Lord Walton came to the House in 1940, his objectives were to ensure that the nation had enough food of sufficiently high standards, and of course we wanted to survive. The threats we face have changed, but we should ensure that this legislation is true to the same principles: food security, food standards and sustainability.

Rural Economy (Rural Economy Committee Report)

Lord Carter of Coles Excerpts

Tuesday 8th October 2019 Lords Chamber

[Lord Carter of Coles (Lab)]

My Lords, it was a delight to be a member of the Select Committee on the Rural Economy. We are a diverse group, there were some strong views and we took evidence from a number of organisations which were similar. It was a very good process and it is great credit to our chair, the noble Lord, Lord Foster of Bath, that he managed to corral us—or guide us, whatever the word is—to produce what another noble Lord called this mammoth and, I think, comprehensive report. We were also extremely well served by our clerk, his assistants and our two advisers.

Essentially, the report is about fairness. It is about what should be the division of government expenditure and influence between the various sections of society. Many aspects of rural life are disadvantaged by the unwillingness of successive Governments of all parties to take steps to secure those who live and work in the country—which, despite its charms, is disadvantaged in receipt of key services. I shall cite what I think is the guts of the report. It states:

“No resident or business should be disadvantaged unreasonably by their rural location”.


The report is wide-ranging and covers many subjects—housing, healthcare, training et cetera—but I should like to focus on three: transport, digital connectivity and economic development.

Those of us who use the transport system in London are used to a train a minute on the Jubilee line. Sometimes we get frustrated on other lines when we have to wait for seven minutes. Contrast that with other parts of the country, where sometimes you have to wait seven days for a bus, if it comes at all. Bus services, and trains to a degree, in rural areas are characterised by low frequency, limited hours of operation, indirect routes—they tend to wriggle around—and inconsistent connections with other modes. Other countries have done somewhat better. In certain cantons in Switzerland, they have what is called pulse timetabling: it is regular, every hour. In many communities in Switzerland, there is a bus or a train every hour between 6 am and midnight. That means that people can count on it and, not surprisingly, the public transport system is widely used and serves the function of holding things together.

If you look at how these things are financed, there is no greater disparity than the subsidy that we in London and the south-east receive, which is practically £2,000 a head, contrasted with the north of England, where people are getting just £427 towards transport. That is then reflected in fares. If you have to pay, you can get a five-mile trip on a London bus for £1.50. If you go to parts of Hampshire, you will pay £5.65 for the same distance journey. We heard from the noble Lord, Lord Cameron of Dillington, I think, the sad story of the boy in Cornwall who was offered a tremendous training opportunity—a course. When he asked, “How am I going to get there?”, they said, “Take the bus”. “But”, he said, “it is every two days and I have to attend daily”. That is a real failure of policy to deliver. It would be interesting to see, if we took the London subsidy per capita and applied it to rural areas, what a tremendous transport system we could get.

We have heard a lot about digital connectivity. It is very straightforward, but it has been patchy, which is a great disappointment. It is ironic that farmers and the people who serve them are now, in this time of great uncertainty, being told to diversify. Here I declare an interest as a farmer. We have been told to look at other things. Digitally, we need to be enabled, yet it is patchy and inconsistent. For instance, where I live in rural Hertfordshire, recently a group of three houses were quoted £25,000 to be connected to high-speed broadband. The only saving grace is that now they will get £3,400 a head to compensate for it. Looking forward in the digital age, the Government require us to be digital. Healthcare will become digital, and all those things need good connectivity. I hope the Minister can reassure us that the Government will meet the timetable that they have laid down for high-speed connectivity throughout the rural economy.

I turn now to economic development. We had the RDAs; I think their disappearance had a mixed reaction. They have been replaced by LEPs. It is very important that we pay attention to the evidence we heard in the committee. The evidence is that the representation of rural needs around the country, both in membership of LEPs and the economic benefits flowing from them, is inconsistent. There are examples of good practice. The South West Rural Productivity Commission clearly shows how four LEPs joining together can do this. But, in a sense, the key to the rural economy are SMEs. How do we help them become formed? Above all, how do we help them sustain themselves in the early years in what are very difficult times? Clearly, they need broadband. You cannot now develop a business nationally or internationally from some remote part of Britain unless you have adequate broadband, and it is the responsibility of the Government to make sure that is available.

Over and above that is the issue of physical support. In the evidence we took, we heard that there was a shortage of small workplaces and small offices around the country. One reason is because these are often bad for investors. SMEs are notoriously prone to failure, and therefore there tends to be a market failure of providing for them. In certain parts of the country we have seen local authorities pick up the baton. North Kesteven is a very good example in Lincolnshire, where they have picked up the baton and built small workshops and small offices, and over time these become very successful and self-sustaining. So we need two things: electronic connectivity and physical presence to allow people to come together and do this.

Other noble Lords have mentioned that successive Governments have disregarded the place of the rural economy in our country. It is rather strange, given that it involves 17% of the population—getting on for one in five people—yet I feel that they feel unrepresented. I hope that the Minister, when he responds, can tell us that there will be a more determined, active and pace-driven approach to this, because it is a very important sector, which will come under pressure. Whatever happens with Brexit now, undoubtedly there will be great change in the countryside, and it is critical that we have a clear rural policy.

I was reflecting that the approach of successive Governments has been like the legendary dog watching television; you know what they say: “He can see it, but he doesn’t get it”. There is something like that in all these successive government policies, and I hope that the report, complete with its recommendations on rural-proofing, gives this Government some means of actually getting it.

EUC Report: EU Sugar Regime

Lord Carter of Coles Excerpts

Monday 3rd June 2013 Grand Committee

Moved by

[Lord Carter of Coles]

That the Grand Committee takes note of the report of the European Union Committee, Leaving a Bitter Taste?: The EU Sugar Regime.

[Lord Carter of Coles]

My Lords, I chaired Sub-Committee D—the sub-committee on agriculture, fisheries, environment and energy—when this report was produced last year. Sadly I have now stepped down from that position, but happily I have passed the baton to the very able hands of the noble Baroness, Lady Scott of Needham Market.

Before moving on to the detail of our report, I want to deal with a procedural matter. We published our report in September last year. A response was received quite promptly from the European Commission in March. Despite repeated prompting, though, we received a response from the Government only last Wednesday, almost seven months late, and I suspect it may only have been the pressure of today’s debate that produced it at all. Members will know that receipt of a government response three working days before a debate, and during recess, does not provide ample time for preparation for a parliamentary debate.

We recognise the challenges of the last few months, which have seen the parameters of this debate shifting on a regular basis as the common agricultural policy negotiations have progressed, but the lack of communication from the Government during that process has been lamentable. We trust that there will be no repeat of this disregard of Parliament in future.

I turn to the substance of today’s debate. The EU sugar regime might sound like a very niche, distinct and rather arcane area. However, it has widespread implications. The first is that sugar remains one of the most protected sectors under a CAP that in other respects has slowly made progress towards a more liberal regime. Secondly, like it or not, we all consume sugar and it is our contention that we, as consumers, pay more than we should as a direct result of EU policy. Thirdly, the regime also has significant implications for developing countries, and I shall come back to that point.

At the time of most of the reform of the sugar regime in 2005, we undertook an inquiry and welcomed that reform as a necessary step, although even then we regretted that more extensive proposals had not been pursued. Since then there have been critical reviews of the regime, not least by the EU’s Court of Auditors. Indeed, in 2011 the European Commission tried to identify some of these shortcomings in its proposals to reform the common agricultural policy. For that reason, we decided to undertake a short inquiry into this subject last spring as part of our contribution to the debate on the reform of the CAP, knowing that the future of the EU’s sugar regime would be a closely fought tussle in those negotiations. We were also keen to ensure continuity and follow up on our earlier report.

I turn first to quotas. The EU’s sugar policy is not something of which we can be proud—in fact, it is not sweet, it is rather bitter. It is still a policy that restricts both the production of beet sugar in the EU and the import of cane sugar from third countries into the EU. Changes made in 2006 have ensured that the EU’s minimum price is there, yet we do not have a guaranteed minimum price. That is a rather contradictory position.

There was a clear division of opinion among our witnesses as to when, and even if, production quotas should be abolished. Some argued for an extension of the system until 2020 in order to allow the sugar beet industry to restructure further and prepare itself for the onset of the world market. Others—quite logically, those on the receiving end of an uncompetitive market—argued for the immediate end to quotas. This included the industrial users of sugar, such as manufacturers and producers of confectionery products and the like.

However, that final grouping also included the importers of raw cane into the EU for refining, specifically Tate & Lyle. Their position was that either they should be protected against the market or both the beet and cane sectors should be liberalised—a logical position. We took the view that neither the cane nor the beet sectors should continue to be protected and that this would involve both the abolition of production quotas and the easing of import tariffs on raw cane sugar. We acknowledged the difficulties of negotiating this, but suggested that in the event that production quotas could not be phased out by 2020, they should certainly end at some point between 2015 and 2020.

It is pleasing to note in the Minister’s response that the Council’s negotiating mandate extends quotas only until 2017, although that has to be negotiated finally with the European Parliament, which itself favours 2020. I would very much appreciate it if the Minister could share any further intelligence with us, including how the Government are working to ensure a positive outcome in this respect.

We also recommended that, as part of a package to assist with the negotiation over the ending of quotas, support should be available to remove inefficient production. Interestingly, the Government disagree, noting that there is no justification for the spending of such money. Let me be clear: we supported the use of such funding only as part of a compromise package. It is unclear to me, frankly, how the Minister expects to be able to negotiate the 2017 date without some form of financial compensation. I would welcome clarity on that subject.

I turn to the issue of price and competition. One consequence of the protected sugar industry is that costs to the consumer are higher than they should be. We were struck by the findings of the EU’s own auditors, the European Court of Auditors, which concluded in 2010 that changes in the EU market price for sugar were not passed on to the consumer. Between 2006 and 2012, the average price of a kilo of granulated sugar in the UK rose by one-third, while the market price increased by only 16%. Clearly there is a widening of margins somewhere.

We concluded that the consumer is the missing stakeholder from the debate on EU sugar policy. The Commission refuted that argument in its response to us, noting that:

“Consumers are consulted in the framework of the High Level Forum for a Better Functioning Food Supply Chain”.

That seems hardly a very consumer-focused body to us, so it is no surprise that we remain unconvinced about this.

The Government say that they have used every opportunity to raise awareness of the impact of this policy on consumers. I should be grateful if the Minister could tell us whether the Government’s work has influenced the course of negotiations on sugar, and indeed generally on the future of the common agricultural policy in any way.

We noted that this is a highly concentrated industry; as we heard, only six companies account for almost 80% of sugar production quotas. The European Competition Network, a network of national competition authorities and the European Commission, has been very critical of the concentrated nature of the industry. The Government confirm that the sector is in the spotlight and that the European Commission undertook an unannounced inspection on 23 April at the premises of companies active in the sugar industry in several member states.

The Commission noted in its response to us that it is conducting its own study into price transmission in the sugar sector, which I understand should be available imminently, and we are keen to see what it says. We are pleased to note that the UK’s Office of Fair Trading is assisting the Commission in its work. I urge the OFT and the Government to be very vigilant in this area.

Another issue that we are keen to see explored is risk management. We observed that most sugar producers are a risk-averse group, which is why they have a strong preference for continuing the protection available under the current regime. The reformed CAP contains some support for risk management, including support to help farms and groups of farms manage their own risk, making use of private sector insurance mechanisms. This is important; it is trying to make industries use the private sector instead of always relying on the state to somehow mutualise the risks that they face. This is a theme that we have referred to many times in our reports.

The Government are imprecise in their response about their preferences regarding risk management. I would welcome an update from the Minister on the state of play of risk management in the CAP negotiations and what the UK’s current priorities are for that aspect of the negotiation.

I want to focus on the importance to beet growers, in terms of managing their risk and in the light of the concentrated nature of the industry, of clarifying the relationship between beet producers—that is, the farmers—and processors such as British Sugar, Nordzucker, Suedzucker and all those big organisations. The proposals to reform the CAP insist that this relationship be covered by a written agreement but do not set out what should be included, which is in fact a step back from the status quo. The Commission insisted in its response that such detail can be set out later in secondary legislation. I would welcome an update from the Minister on where that debate has reached.

One of the recurring themes on our committee has been that of research. We emphasised in this case the importance of basic and applied research in sugar, supported by adequate knowledge transfer: that is, getting the research from the lab into the hands of farmers. We recommended that the Government assess whether research efforts in this industry are in line with the needs of consumers. The Government appear content that all necessary basic and applied research is being undertaken and is sufficiently funded. Sadly, we do not share the Government’s confidence on that matter. While we agree that the industry is particularly well placed to identify its needs, at least in terms of applied research, it is important that science is able to feed in basic research and to be financially supported in its efforts. It is only through this sort of research that we will maintain in Europe the lead in technology that we need to maintain our position in the world and in trade. There will inevitably be a tendency by industry to focus on low-hanging fruit, but I urge the Government to take a greater interest in this important part of the chain.

The African, Caribbean and Pacific bloc and the so-called least developed countries, the LDCs, have had preferential access to the EU’s sugar market and were therefore negatively affected by the reduction in the EU’s sugar price after the 2006 reform. A helpful package of transitional measures was put together, known by the lengthy name of Accompanying Measures for Sugar Protocol countries funding. We heard that almost €1.2 billion had been allocated to this, yet much of it had not reached the intended beneficiaries. This was due in part to insufficient resourcing in the Commission’s offices in those countries. It is very sad that the money was available but we could not find a way to spend it. That is clearly an issue for the Commission to address. I am glad that the Government similarly recognise the problem and that they will seek assurances from the Commission that local offices will be sufficiently resourced.

In evidence to us, we were favourably struck by the Minister’s condemnation of the plan for further reform, which in his view almost entirely ignored the needs of developing countries. He emphasised that the Government have an obligation to find ways to support them, and we support that.

It was surprising to note from the Government’s response that some progress had been made in negotiations on the European Development Fund. The response indicates that funding available to many of the sugar-producing developing countries will support interventions that have the most impact on the critical areas of poverty reduction, job creation and economic growth.

These developments are helpful and important, but I would caution against any complacency. We have had seven years of little action on this, and I urge the Government to ensure that they are assiduous in their work with the Commission on monitoring the effect of the new reform and ensuring that the money that has been allocated gets spent.

I have spoken today on behalf of the committee and I pay tribute to its members, whose engagement with this subject gave our inquiry both energy and effect. I also pay tribute to our clerk of the committee, Kate Meanwell, and to Alistair Dillon, our researcher, both of whose endeavours on our behalf made us better informed and better able to produce this report.

The common agricultural policy continues to be reformed, albeit slowly. It is extremely disappointing that there are sectors within it, such as sugar, that proceed at such a glacial pace along that path. Certain industrial concerns dominate while the interests of consumers and developing countries are virtually ignored. This is not a situation that we should tolerate, and I look forward to hearing from the Minister how the Government’s attempts to promote reform are bearing fruit in Brussels. I beg to move.

--- Later in debate ---

[Lord Carter of Coles]

I thank all noble Lords for their contributions. We have had an interesting debate that, as the noble Earl, Lord Caithness, said, has come at a crucial time. The critical thing about these reports is to be able to make the point while the negotiations are taking place.

We have all sensed the great loss that we all felt because the noble Baroness, Lady Byford, could not contribute, and in this debate her incisiveness and her fact-packed contribution brought evidence of that. In my experience the noble Earl, Lord Caithness, always seems to have the knack of zeroing in on a key issue and then helping us along a little with a reminiscence of somewhere such as Romania, which is always very much appreciated. The balanced view of the noble Baroness, Lady Parminter, of the needs of consumers in terms of price but also in terms of welfare and health was a perfectly fine contribution to this debate. I very much welcome the intervention from the noble Lord, Lord Palmer, who made his point so strongly.

I thank the noble Lord, Lord De Mauley, for setting out the views of the Government. It is nice that we are all in so much agreement on what needs to be done, and we appreciate how difficult it is for the Government to exercise their point of view in these very difficult negotiations. I speak for us all in saying that we are grateful for the fulsome apology that he was able to make on the late response.

We should hope that the Government are now successful in their attempts to work with EU partners to renegotiate the sugar terms. Clearly, the position of the French and Germans—the great barons of the industry, if you like—makes it very difficult, and we should offer every support that we can to ensure that the next seven years, in terms of everything that we want to see happen, are somewhat more productive than the previous seven.

Turning to my chairmanship of sub-committee D, I have done this for the past four Sessions. For me, at least, it has been a delight. We have had some really focused and productive times, and generally I believe that they have been happy. That has been a hallmark of our committee. That has been wholly due to the committee’s members, and we have been extraordinarily fortunate in the composition of our committee. I also record our thanks to our successive clerks: Paul Bristow, Kate Meanwell and Aaron Speer. Running through it, we have been fortunate to have the same golden thread of our researcher, Alistair Dillon, who has been absolutely tremendous.

A further delight to me is that the noble Baroness, Lady Scott of Needham Market, has taken over as the chair of the committee. I have no doubt that it will be as fulfilling for her as it has been for me. I beg to move.

Motion agreed.

EUC Report: EU Freshwater Policy

Lord Carter of Coles Excerpts

Wednesday 5th December 2012 Lords Chamber

Moved By

[Lord Carter of Coles]

That this House takes note of the Report of the European Union Committee on An Indispensable Resource: EU Freshwater Policy (33rd Report, Session 2010–12, HL Paper 296).

[Lord Carter of Coles]

My Lords, some have suggested that our report into water policy had the powers of a rain dance, for no sooner had we concluded the inquiry in April, which highlighted water shortage, than the heavens opened and we had one of the wettest summers on record. Even as we come to debate our report, much of the country seems to be under water. Yet, although ground-water levels in the UK have been topped up, we must not be complacent, as long-term trends that we face are very clear, and we face some difficult choices going forward.

The European Environment Agency observed that the number of countries affected by drought per decade rose from 13 in the period 1971 to 1980 to 24 in the period 2001 to 2011. The analysis showed that the drought occurrence not only increased in the central and southern areas of the EU but, significantly, also in the northern and eastern parts of the EU, in countries such as the UK and Sweden. The reasons for this are clear: intensification of agriculture; urbanisation; climate change; and, of course, a rising population.

Looking forward to 2050, we can expect a world population of some 9 billion, and so we will need to provide 70% more food and 80% more primary energy, and, of course, a significantly greater amount of water. Given that the supply of water is finite, this is a critical, if not urgent, matter, and we need to understand what our water policy should be in order to mitigate future crises. That is not easy. There is a great deal of uncertainty, particularly relating to climate change. However, one of our witnesses, Professor Alan Jenkins, put it very well. He said:

“Uncertainty is no reason for not doing anything”.

In 2010 we published a report on adapting EU agriculture and forestry to climate change. It is fair to say that the increasing water scarcity was a particular theme that came out of our inquiry. Subsequently we undertook an inquiry into innovation in EU agriculture, in which a key concept was sustainable intensification; that is, producing more from less, including, of course, less water.

It therefore seemed appropriate to us, given the increasing focus on water policy in the EU, to build on that previous work and to offer thoughts, some of which we hoped would be of assistance to the Government in developing their policy and to the Commission in preparing its blueprint for the future of EU water policy. Fortunately, that blueprint was published two weeks ago, and so, if I may, I will set out our conclusions and what the blueprint had to say about them.

We have to accept that the cost of water will have to rise. But before we can even think about that, we have to have a more fundamental consideration of how we value water. It is interesting to note that water is a scarce resource; yet, it has taken 20 years for the price of water to rise by 40%. When you look at the other scarce resource, energy, the price of gas has taken only five years to reach the same level.

The water framework agreement places an obligation on member states to do two things. One is to ensure that by 2010 water pricing policies provide adequate incentives for consumers to use water more efficiently. The second is to ensure an adequate contribution of the different users disaggregated into industry, agriculture and households. The object of that is to ensure that each pays an appropriate share of the cost of water services. That needs to take into account environmental and resource costs.

What surprised us was that during this inquiry, the UK’s regulator, Ofwat, told us that there is no real price placed on water in the UK. The Commission was critical in the blueprint of cost recovery in the UK. It appeared to us and to the Commission that water services were too narrowly defined and did not reflect environmental and resource costs, including self-abstraction by agriculture. Cost recovery is not transparently presented for all relevant user groups. Therefore, I ask the Minister to respond to that criticism and to answer how the UK will ensure as a matter of urgency that it is in a position to value water effectively.

Abstraction becomes important because it was regarded as not being effectively cost recovered. The Commission observed that the second most common pressure on ecological status right across the European Union stems from abstraction. In our report we urge the Government to accelerate their timetable for reform of the UK’s abstraction regime, a position that I know is shared by the EFRA Committee in the other place.

While we accept the Government’s position that the reform of the abstraction regime is a major piece of work, which should be evidence-based and carefully considered—that is, go slowly—is it not the case that changes made by this Government in other areas, including health and education, have been significant? We would welcome an application of a similar urgency and political impetus to tackle overabstraction, given the clear direction in the blueprint.

As regards water efficiency, scarcity can, in part, be addressed by efficiency. I have already mentioned abstraction but more must be done to tackle the scandalous levels of leakage and to encourage personal water efficiency. During our inquiry we were shocked to learn of the levels of leakage from water infrastructure. Why is it that in Germany the so called “sustainable economic leakage level” is 7% while in the UK it is 25%? In certain other countries in the European Union, it is as high as 50%. One way to encourage personal efficiency in water use is through metering. In our view, a greater use of metering needs to be considered. The Commission, quite rightly, describes metering as,

“a pre-condition for any incentive pricing policy”.

Does the Minister share that view?

Another example of innovation in water efficiency is water foot-printing. It has been calculated that, as a global average, it takes 70 litres of water to produce one apple and 15,000 litres to produce one kilo of beef. I do not know whether this is the experience of others but sometimes I have sat at a long lunch with rather dull company and hoped that some of that water could reform itself into a tidal wave and sweep away some of the clutter that we were facing. None the less, looking at the assessment of the amounts of water embodied in products and how the value of that water can be taken into account can make a real change to the way in which consumers make their choices. I am pleased to note that the Commission is very supportive of that concept.

A further area of efficiency is that of water reuse. One of the new legislative initiatives suggested by the Commission in its blueprint relates to water efficiency around this area. Many noble Lords may be aware of grey water use in Europe. This is lower-grade water which is used for irrigation. The Commission has identified that the use of this water faces certain obstacles because there are no standards. Because there are no standards, this leads to restrictions in the export and movement of agricultural products around the European Union. Therefore, it is suggesting that standards could help to alleviate this situation. Do the Minister and the Government have a view on the Commission’s analysis and are the Government planning to introduce such standards unilaterally?

Agriculture is a very large user of water. In our report, we urge member states to make use of rural development funds to support water management and water efficiency in agriculture. We were interested to note the Commission’s view that there is a lack of clear strategy in the UK defining the basic measures that all farmers should adhere to and what additional supplementary measures can be financed. Clearly, we do not want to pay for what we should expect as the norm.

The Government have indicated that a strategic framework for agriculture and water is being worked on across Defra. I should be grateful if the Minister could say more about that framework, including timing, and whether the Government consider that they will tackle the issues highlighted by the European Commission.

I now turn to urban diffuse pollution. This is a major issue as, within the European Union, most of us live in urban areas. During our inquiry, we were concerned that a recognition of the impact of agriculture on the water environment had in many ways diverted attention from the impact on urban diffuse pollution. We recognise that Defra is doing work on this and has published a consultation on its strategy for combating it. While we are supportive, I think that the proposal, rightly, is for a lot of this responsibility to be pushed to local communities. We are very supportive of local engagement. But is the Minister confident that communities will have the necessary tools at their disposal coherently to tackle key issues, such road run-off? Perhaps the Government might usefully draw on the experience of Danish colleagues, following the example of Copenhagen, as set out in Box 4 of our report.

We concluded that further research is required into urban diffuse pollution, particularly on run-off, sediment and waste water treatment. The pressure on costly urban systems could be reduced if the discharge or discard of chemicals into the sewerage system were to be reduced. In that context, we welcome the Commission’s commitment, in the blueprint, to present a report on pharmaceuticals and the environment.

It is particularly interesting that one chemical, EE2, which is present in oral contraceptives, makes its way into the sewerage systems across Europe. To give noble Lords some idea of the extent of this, it is estimated that over the next 20 years, we will have to spend £27 billion to clean this up. That gives a sense of the scale of the challenge that we are facing.

Some solutions may be found in the European Innovation Partnership on Water, to which we drew attention in our report. The essence of this is networking between researchers, companies, public authorities and consumers. How this trickles down involves those at the local level and taking it forward is one of the key challenges that we face. Again, it would be useful to have confirmation that the Government are actively engaging with practitioners and stakeholders to bring this fledgling initiative to their attention so that, locally, people know that they can become engaged from the beginning.

Perhaps I may say a few words on governance. Engagement with stakeholders takes me to a core conclusion of our report and a significant shortcoming that we see in the blueprint. We were extremely impressed by the evidence we received about the work that is taking place organically at catchment level—that is, the sub river basin level—to manage fresh water in the UK and Australia. We heard some extremely good evidence from the south-west of England and some extremely good evidence about what is going on in Australia. The essence is to engage local communities in the appreciation of their rivers so that they get to understand all the consequences of actions and the benefits arising from them. However, none of these local initiatives will work without leadership, technical support and financial resources. Where one of these is missing, success is impossible. Can the Minister reaffirm the Government’s commitment to sharing their experience of catchment management with others as an example of best practice? Spreading this is very important.

So far I have said very little about our views on implementation of the water framework directive, which is, after all, the core of the EU’s freshwater policy. On first experience of implementation, our conclusion was that it has been a great force for good. Yes, implementation is proving challenging, yet the very aspiration of seeking to achieve good status is clearly helpful. Based on the very strong view that we received from witnesses, we emphasised the need for a more nuanced approach to reporting progress in improving the quality of water courses, going beyond the changes in status. As the Government wrote in their response:

“Achieving good status is a long term goal and it needs to be recognised that preventing deterioration and making progress towards achieving good status are … achievements”.

We firmly agree with that. However, I would welcome comments from the Government as to how they consider that such recognition can be introduced into UK reporting procedures.

[Lord Gilbert]

I have been listening with great care to my noble friend’s very instructive and lucid remarks. I declare an interest as a director of an American company that is engaged in purification of water involving the fracking process. I did not hear my noble friend say anything about fracking. The amounts of water that are going to be involved in the United States are stupendous. Perhaps he could enlighten us as to whether his report took account of the possibility of fracking spreading to this country at anything like the scale it is proposed to extend to in the United States.

[Lord Carter of Coles]

I will deal with that now. We did not look at fracking, but we are looking at it in the context of our inquiry into energy, which will be very critical. We hope to report on that in the spring of next year.

One issue that concerned us greatly in this inquiry—as in a number of others that we have conducted—was the consistency of monitoring and enforcement across the EU. Time and again we conduct inquiries and find that we in this country have monitored and enforced effectively, only to look across at other countries in the Union and find a somewhat less than enthusiastic attitude to monitoring and enforcement. Therefore it is very comforting that, in the case of water, both the Government and the Commission accept the need to strengthen monitoring and enforcement. The Government make a series of commitments in this regard in their response, including working on harmonising monitoring programmes, reporting procedures, and sampling and analytical methods. These commitments are very welcome. However, given our concerns, can the Minister please tell us how the Government plan to take these ambitions forward? We see this as a critical area.

I have spoken today on behalf of my committee, many of whose members are present here, and I pay particular tribute to those members whose engagement and insight really brought energy to the inquiry. I also thank the committee’s specialist advisers—in this case, Professor Robert Harris of the University of Sheffield and Dr Jonathan Wentworth of the Parliamentary Office of Science and Technology; their support was of great value. In the months since the report was published, we have seen the commission's blueprint, and we have seen progress with the pilot catchment management and the draft UK consultation on urban diffuse pollution. Those are all very important steps forward, but we are looking to see more action.

To conclude, I return to where I started. Notwithstanding the recent weather, there is a need for urgency. We believe that the water framework directive is a force for good, but we believe that more must be done quickly to operationalise the policy and the aspirations. We need action on pricing, on abstraction and on diffuse pollution, and we need it quickly. Some 250 years ago, Benjamin Franklin noted that when the well is dry, we know the value of water. Looking across the EU, from Cyprus to Estonia to Essex, the wells are beginning to run dry and we need to do something about this rather quickly. Securing fresh water for future generations in the UK and Europe is a fundamental responsibility. We need to recognise that we will have to pay for it and we need to take the long-term view, as I suggest our forebears did when they made the great 19th century investments in water and sewerage, for which we have been grateful for more than 100 years. I beg to move.

--- Later in debate ---

[Lord Carter of Coles]

My Lords, I thank all noble Lords for their contributions. This evening we have been debating an important issue and what we have heard from all contributors has served to underline that.

A number of themes have emerged during this debate. Importantly, there was the issue of governance and local involvement, a point made by the noble Baroness, Lady Miller of Chilthorne Dormer, who was supported in that by the noble Lord, Lord Cameron of Dillington. We discussed the tools that are available to drive these changes, such as metering, which the noble Lord, Lord Cameron, mentioned, and trading in water rights. Virtual water was a theme from the noble Earl, Lord Caithness, supported by the noble Lord, Lord Giddens.

The dominant theme of the evening has been urgency. We are grateful to the Minister for picking up that sense of urgency, which we feel is needed in this important area.

I thank the noble Lord, Lord de Mauley, for setting out the views of the Government. We look forward to seeing how they take these messages forward for debate and discussion on their own domestic water policy and, more importantly, how they take it forward in discussions with the EU as a result of the blueprint and the common agricultural policy.

In my opening remarks I referred to Benjamin Franklin’s words of wisdom about the worth of water. At the same time, another commentator, Thomas Fuller, said that we never know the worth of water until the well is dry. Let us not wait until all the wells of Europe are dry before facing up to the true value of water. Of the messages that have come out tonight, the one that I would choose to flow through this debate is that we should look to the value and at how to spend it wisely.

Motion agreed.

EUC Report: Agriculture

Lord Carter of Coles Excerpts

Monday 6th February 2012 Grand Committee

Moved by

[Lord Carter of Coles]

That the Grand Committee do take note of the report of the European Union Committee on Innovation in EU Agriculture (19th Report, HL Paper 171).

[Lord Carter of Coles]

My Lords, I declare an interest as a farmer in receipt of payments under the common agricultural policy.

“Sometimes we talk about agriculture as something very old and traditional; it is not competitive and we can forget it. We really don’t understand how strategic agriculture will be in the future … We have left the era of surplus and come to the era of scarcity. We need to refocus what an Innovation Union is … agriculture is at the centre of an Innovation Union and the new global challenge”.

Those of your Lordships who have our Innovation in EU Agriculture report to hand will know that these are not my words but those of Mr Paolo de Castro MEP, the chair of the European Parliament’s Agriculture Committee, who gave evidence to our inquiry. We quoted Mr de Castro’s words at the start of our report because they encapsulated the key concerns of the committee, which I am sure are widely shared in the House.

The committee sees a future characterised by risk and uncertainty. The first risk is that of climate change, which threatens more extreme weather events; the second is that of demographic change, which means more mouths to feed and more complex diets to satisfy; the third is the multiple uncertainties which surround the economic health of states in Europe and elsewhere. It is imperative that policy-makers in all areas have their eyes open to these risks. Our inquiry left us in no doubt that agricultural policy is no exception; indeed, we suggest that it is of central importance in meeting the challenges ahead.

Since our report was published, the European Commission has presented its proposals for the common agricultural policy from 2014. I shall say more about that and our assessment of it later on. For us, the key test is how they measure up against the need to orientate the CAP towards the thoroughgoing support of innovation in agriculture, because, if we do not increase productivity, we face some very serious challenges.

It is almost exactly a year since the Government Office for Science published the Foresight report on global food and farming futures. I was pleased to chair a seminar here in the Palace last February at which Sir John Beddington, the Government Chief Scientific Adviser, presented his findings to us. Against the background of projections that foresee an increase to 9 billion in the world’s population by 2050, the Foresight report highlighted six important drivers of change. The first, obviously, is the global population increase; the second is the size and nature of per capita demand; the third is the governance of the food system; the fourth is climate change; the fifth is competition for key resources, as we can see in Africa now; and, the sixth, is changes in consumers’ behaviour.

The committee was able to take evidence from Professor Charles Godfray, one of the lead experts for the Foresight report, about the need to bring about what we call the “sustainable intensification” of agriculture. Your Lordships will no doubt recall that the Royal Society has supported this aim and explained it as the process of increasing agricultural yields without adverse environmental impact and without the cultivation of more land. We also supported it when we reported on adapting EU agriculture to climate change in March 2010. In his evidence to us, Professor Godfray said that, given the certainty of increasing demand for agricultural output, sustainable intensification was,

“almost a deduction rather than an argument”,

and he described innovation as critical to sustainability.

As your Lordships know, CAP represents more than 40 per cent of the EU’s budget expenditure. For the period 2007 to 2013, the agricultural policy budget is around €400 billion, which is split roughly 80:20 between direct payments under Pillar 1 and rural development measures under Pillar 2. There are, of course, powerful arguments that this level of EU expenditure is too high, but we must face the political reality that while the overall level may be reduced, the EU will continue to offer major financial support to European farmers over the next budgetary period from 2014.

Our report maps out ways in which future CAP expenditure should be directed towards promoting innovative agriculture, and, in particular, we call for money to be switched out of the CAP and into increased funding for agriculture and the EU’s research programme. We argue that when payments are made under Pillar 1 of the CAP, this should be in return for the delivery of environmental benefits by the recipients. We also call for a higher share of CAP funding to be reallocated towards innovation under the rural development fund in Pillar 2. I should like to talk about each of these changes in turn.

First, regarding agricultural research, we were struck by information making global comparisons in agriculture. The OECD and the FAO co-operate in analysing agricultural markets over a 10-year horizon. In our report, we quote the OECD-FAO Agricultural Outlook 2010-2019 and highlight projections for increased agricultural production over the next decade in different parts of the world. We found the numbers particularly compelling. In Brazil, the forecast increase is more than 40 per cent; in the United States, growth of between 15 and 20 per cent is forecast; yet the projected increase in Europe is a mere 4 per cent—hardly adequate to deal with the challenges that the continent faces.

A mix of factors underlies these comparisons and the starting points for farming in these different areas vary widely. However, anyone looking at these comparisons must surely share our view that the options for the future of EU agriculture would not include a steady-as-she-goes approach. It is just not good enough to carry on as we are. Again, I use a quotation from one of our witnesses—a most impressive witness— Mr Georg Häusler, Head of Cabinet of the Agriculture Commissioner. He spelt out the need for the European Union to look beyond its boundaries and respond to the fast-changing world we are in. He said:

“We in Europe are sitting here saying, ‘Agriculture is the old economy’, in what I call an innovation-hostile environment”.

We have heard this before. He continued:

“A lot of political groups are telling us to farm as we did in the 19th century, selling our tractors and doing it in the old way because it will be good for the environment”.

Yet, he continued:

“This is the strategic debate. Does Europe say that it can provide food for 500 million rich Europeans and import what we do not have, or does it play a role in feeding 9 billion people, including 1 billion people in China and India who are starting to eat meat?”.

As a committee, we are in no doubt that Europe has the intellectual resources to kick-start EU agriculture into the 21st century. Witnesses described the UK and the EU as a powerhouse of creating knowledge. In this country, the Biotechnology and Biological Sciences Research Council, the BBSRC, spends around £470 million a year on research in biotechnology and biological sciences. In France, the National Institute for Agricultural Research, INRA, has an annual budget of just over €800 million—that is, about £670 million. In the EU’s current framework agreement for the years 2007 to 2013, funding of some €2 billion is earmarked for food, agriculture and biotechnology. These are very large sums, but our report makes it clear that it is not enough.

As far as this country is concerned, we received compelling evidence that while the quality of basic research in biotechnology is high, much of the potential for its practical impact is being wasted because gaps occur in the research pipeline. We are clear that the Government urgently need to support efforts to translate scientific findings into agricultural practice much more consistently.

As regards the EU, we said in our July 2011 report that we found it unacceptable that the research budget allocated just under €2 billion to agricultural research over seven years while the agricultural policy budget was around €400 billion. The ratio is just not appropriate.

Your Lordships may know that, in the proposal which the European Commission has more recently published for the EU’s financial framework from 2014, funding of €4.5 billion has been proposed for research and innovation on food security, the bioeconomy and sustainable agriculture. That is a step in the right direction, but we remain of the view that there needs to be a much more radical shift in funding away from simple farm support payments towards the promotion of agricultural innovation.

I turn to the Commission’s proposal on what is called the European innovation partnership on productive and sustainable agriculture. Your Lordships will know that in 2010, the Commission presented its commitment to making the EU an innovation Union. European innovation partnerships are to be established under this commitment in a range of policy areas. They are intended to strengthen co-operation in innovative research, bringing together all the key stakeholders across the EU, from those conducting basic and applied research all the way through to the final users, such as farmers and businesses, and every step in between.

There will be those who understandably question the need for yet another pan-European initiative; we have a lot of those. Our inquiry shows, however, that there is still a considerable lack of co-ordination across Europe among those many excellent researchers whose efforts are key to the future success of our agricultural sector. We have seen the issue of unnecessary duplication. The problem—and the potential solution to it—was clearly described to us in evidence we received from the InCrops enterprise hub at the University of East Anglia. We support the idea of a European innovation partnership which is characterised by effective action-based co-operation. It should not be an aspiration: we need to see the action attached to it and we urge the Government to play their part in bringing this about.

I turn to the CAP itself. Here, I think it makes sense if I link what we said in our July 2011 report with the views that we have now expressed on the reform proposals published by the European Commission in October last year. In their totality, the proposals seem to us to fall short of the commitment to radical change which we think is needed. We consider that the Commission has missed the opportunity to introduce the new approaches to EU agriculture policy which current—and, above all, future—circumstances call for. As I have said, we favour both a reduction in the overall budget and, within a smaller budget, a redistribution of funding away from direct payments towards environmental protection and sustainable innovation.

As for the Commission’s proposals for the greening of Pillar 1 payments, we sympathise with its underlying objective, which is close to our report’s recommendations that payments under Pillar 1 of the CAP should be made in return for delivery of public goods, responding to issues such as climate change, protecting biodiversity, and encouraging agricultural innovation. However, as we see it, it is problematic that the Commission’s greening proposal is a one-size-fits-all approach because it lacks flexibility. Our view is that it would be far better if greening measures for direct payment were identified at the national or regional level and if they build on the cross-compliance requirements while recognising the substantial efforts already made by farmers.

There is understandable concern in the farming community that stepping up the environmental considerations attached to Pillar 1 could result in greater bureaucratic complexity; that is a great concern across Europe. Our answer to that rests on our conclusions about what are called agricultural knowledge transfer systems.

In drawing my remarks to an end, I want to mention those conclusions, particularly on knowledge transfer. Across the EU, there are many channels through which advice flows to farmers, and those include public sector agencies and commercial providers. Our report acknowledges the diversity of methods used to transfer knowledge—this most important thing—and recognises that no one single solution is applicable everywhere; knowledge transfers must be fine-tuned, as I have said, to national and regional practice.

Under the CAP, member states are required to operate a system for advising farmers on land and farm management—the so-called farm advisory system—for which some financing is available under Pillar 2. The FAS was set up at the time of the last CAP reform in order to offer advice, which must relate to cross-compliance but may go beyond that. However, we understand that in practice, in most member states, the FAS’s role has not developed beyond providing just minimal levels of advice. The FAS cannot become the sole source of advice to farmers, but we are clear that the time has come to extend its role beyond cross-compliance. Given the importance of effective knowledge transfer, we consider that, under the CAP, member states should be required to ensure that comprehensive farm advice is available throughout their territories, geared towards meeting the new challenges of food security, climate change and the need for sustainable intensification.

We are pleased that the Commission’s proposals from last October echo this call and foresee that the FAS should extend beyond cross-compliance, and we look to the Government to work with the grain of this proposal. However, our report was particularly critical of the position in this country. We are concerned that the provision of farm advice in England has become fragmented and overly complex. We see the urgent need for the levy boards to play a central role in broadening and deepening the range of advice currently offered in England. In this context, we very much welcome the Government’s recent announcement that, from January of this year, the new farming advice service in England will provide advice on competitiveness, nutrient management and climate change adaptation and mitigation, in addition to continuing to offer advice on cross-compliance. We also look forward to hearing in due course about the outcome of the integrated advice pilot project that the Government launched last year, which we regard as very important. The pilot shows that the Government are listening to us. We think that that is good and, if it shows that they are listening to the farmers, frankly, that is even better.

I offer your Lordships one final thought on this topic. Our report highlights that agriculture innovation is a complex business. It is complex and difficult because it requires interaction among scientists, the farming community, food processors, retailers, government and consumers. That requires systems to be put in place that promote communication among all those actors. When the EU level group on agricultural knowledge and innovation systems reports, it will be very important that member states give that group’s conclusions the highest priority.

In conclusion, having spoken today on behalf of my committee, I pay particular tribute to the committee’s members, whose engagement with the subject gave our inquiry both great energy and great effect. I also thank the committee’s specialist advisers on the inquiry— Dr Julian Clark, of the University of Birmingham; and Dr Jonathan Wentworth, of the Parliamentary Office of Science and Technology—whose support was invaluable. In the months that have passed since the report was published, we have seen encouraging reflections of a number of our recommendations in proposals from the European Commission and in announcements made by the Government. However, we remain concerned that the changes now envisaged to the CAP and to the support given to agricultural innovation, in the lab and on the farm, fail to rise to the challenges that we see in the future. Of course, we support the steps being taken towards innovation in EU agriculture, but, frankly, those modest steps need to turn into determined strides if we are to reach the right destination. I beg to move.

--- Later in debate ---

[Lord Carter of Coles]

My Lords, I conclude by thanking all noble Lords for their contributions. We have been debating a very important issue this evening and all the contributions have served to underline that fact.

I noticed a number of themes emerging from noble Lords’ remarks. The first is the issue of people: the fact that the population of the world is going to rise and requires feeding imposes a moral, political and economic responsibility on everybody who can help in this. That is one of the noblest things we could focus on. The noble Lord, Lord Curry, and the noble Baronesses, Lady Parminter and Lady Byford, mentioned how we can get people to engage in agriculture, how we can motivate them, educate them and up-skill them. These are very important factors; those things together drive that along.

The second theme is the issue of science: the point made by the noble Baroness, Lady Sharp, about the renewal of science, and the fact that renewal of interest in agriculture generally is a wave to ride, something to pick up on and to drive forward. On the subject of science, the noble Earl, Lord Caithness—in his usual to-the-point way—drew our attention to GMOs. This is not to be ducked; it is an issue to be debated and it is an issue the European Union needs to get clear on. We need to address the issue of GMOs if we are to close that gap between productivity in our continent and in other parts of the world.

The noble Lord, Lord Cameron, drew our attention to the challenges we face on a global scale, as did the noble Lord, Lord Bilimoria: the challenges of moral responsibility, of feeding Africa and involving Europe beyond its boundaries by actually going out and serving and helping solve the problems of the world. The noble Lord, Lord Plumb, with his great experience, raised the most pressing question of all: how is it going to be made to happen? How will it happen? How will we influence the CAP and how will it go forward?

The noble Baroness, Lady Parminter, in her questions about research and waste, asked for specifics about how we are going to address those issues, which are really pressing. We need to maintain the pressure—both on our Government and through the Governments of the European Union—to deal with those challenges and not to duck the issues that we have to deal with out there. That is very important.

Looking beyond that, we have the sense of urgency referred to by a number of noble Lords. There is a time, and it is now, and we have to make the voice heard, most specifically around the CAP. We are not going to get another chance for another seven years if we do not do it now. It needs to be pressed on extremely hard to get this done—a point made, again, by many noble Lords. It is pretty straightforward; the policy is pretty simple, but it is the Government’s responsibility as well as ours to come up with the strategy in order to deliver those aims.

In thanking noble Lords, I would also like to echo the welcome extended to the noble Lord, Lord Curry of Kirkharle. I just read a biography of Capability Brown, so it did not come as a surprise about that. I would really like to thank him for his erudite remarks; they were very insightful and clearly, like other Members, I look forward to hearing more of his views in the Chamber as we go forward. I would also like to thank the noble Lord, Lord Taylor of Holbeach, for setting out the views of the Government. Some may refer to the noble Lord as a poacher turned gamekeeper, but I think I am not alone in hoping that his role in Government will actually be a game changer for us here—to get out there and do this and drive towards the innovation in agriculture that we have discussed.

Finally, I am going to seek your Lordships’ indulgence to quote from Ecclesiastes 1:19 in the King James Bible:

“The thing that hath been, it is that which shall be; and that which is done is that which shall be done: and there is no new thing under the sun”.

It may well be that all the changes we want to see in agriculture have all been done on a small scale. We will find these examples in one area or another in different parts of the world and things like that. However, to bring these changes together, to build on them with intellectual and financial support and apply them across the EU agriculture generally—and then out into the world—that would be a new thing under the sun, under the rain, and under the changing climate that we are going to have to live under.

Motion agreed.

Subsidiarity Assessment: Food Distribution (EUC Report)

Lord Carter of Coles Excerpts

Monday 28th November 2011 Lords Chamber

[Lord Roper]

That this House takes note of the Report of the European Union Committee on the amended Commission Proposal for a Regulation of the European Parliament and of the Council amending Council Regulation (EC) No.1290/2005 and Council Regulation (EC) No.1234/2007 as regards distribution of food products to the most deprived persons in the Union (COM(2011)634, Council Document 15054/11) (23rd Report, HL Paper 217).

[Lord Carter of Coles]

My Lords, in the absence of the noble Lord, Lord Roper, I beg leave to move the first Motion standing in his name on the Order Paper. It fell to the EU Sub-Committee on Agriculture, Fisheries and Environment, which I chair, to carry out detailed scrutiny of the latest proposal in relation to food for the deprived. In doing so, we were conscious of the consideration which we gave a year or so ago to the previous version of the proposal. Both the sub-committee and the EU Committee itself, which the noble Lord, Lord Roper, chairs, took the view that the changes made to the latest proposal did nothing to remedy the failure to comply with the principle of subsidiarity.

It is tempting to use this occasion to talk about the common agricultural policy as the evolving backdrop to the scheme to distribute food to deprived persons but, since time is limited, I will make only two remarks in this respect. First, when the scheme was initiated in 1987, a largely unreformed CAP generated excesses of butter, milk powder, beef, sugar, rice and cereals—the so-called food mountains—which allowed food to be released to charitable organisations in participating member states. Those days are long gone. Surplus stocks are now very low and in recent years the scheme has in fact relied on open-market purchases of food, so the link between the scheme and the CAP, clear enough in the past, has become more and more tenuous in the present.

I hope that your Lordships will take the view, as the committee has done, that the task of tackling deprivation faced by our fellow citizens rightly falls on the member states, not on the EU itself. No one should downplay the scale of the challenge on social protection across Europe. Data on expenditure in that regard in October this year—I am relying on data from Eurostat, the European Commission's own source—showed that, in 2009, the 27 member states spent over €3 million million on this support. That is, greater than the figure 3 followed by 12 zeroes of euros: a colossal amount of money. Compare the scheme for deprived persons that is being proposed here of €500 million or so. Doubtless that can buy a great deal of food, but in respect of the total spend by member states it is not of great significance.

Agriculture: Global Food Security

Lord Carter of Coles Excerpts

Thursday 12th May 2011 Lords Chamber

[Lord Carter of Coles]

My Lords, I congratulate the noble Baroness, Lady Byford, on securing this important and timely debate. I declare my interest as chairman of Sub-Committee D of the EU Select Committee of your Lordships’ House, which scrutinises, among other things, EU agricultural policy. I am also a farm owner. Allocating resources to a wide range of security issues has always been a challenging priority for government. Should there be more police; should there be more prisons; should there be more soldiers? These are frequently debated, yet probably one of the most critical issues that the world faces at the moment—food security—is rarely debated. That is why today’s debate is so valuable.

The past 50 years or so in agriculture have been a relatively benign period. Technology has increased productivity and more land has been brought into production. Generally, apart from in recent times, that has held down food prices. It has enabled us to feed the rising world population, which in that time has risen from 3 billion to 7 billion. That is quite an achievement. However, looking back over recent times, there are various occasions when the predictions of Malthus may have seemed to have become a reality. I think back to the 19th century and the famine in Ireland, the famine in Ukraine in the 1930s and the Bengal famine in the 1940s.

It is interesting that, in the lifetime of many people in your Lordships’ House, the Second World War showed us what the issue of food security meant. In 1939, 70-odd per cent of food was imported to this country; by 1945 we had got that down to 25 per cent and were still able to give everybody in the country—around 42 million people—2,200 calories a day. Contrast that with today when we import 40 per cent of food and still give everybody 2,200 calories a day. I suppose it might explain something that the decrease in manual labour has been tremendous in that period, so you would have expected the calorific intake to go down. Maybe that partly explains some of the healthcare challenges that we face. Looking forward, there is the challenge by 2050 of feeding a world population that will increase from 7 billion to 9 billion. Even as we seek to increase the yields from agriculture, we need to avoid the adverse environmental effects of some types of farming—hence the need to practise the sustainable intensification of agriculture.

As we look around, there are doubts that Europe and the UK can meet this challenge. In the medium term we are told that, already having suffered 10 years of stagnation in the rise in output, in the next 10 years agriculture output in the EU will rise by only 4 per cent. That will contrast with the United States, where it will rise by between 10 and 15 per cent, and Brazil where it will rise by 40 per cent. Various factors explain these differences. Those countries do not have the constraints of European agriculture, in which there is a great deal of focus on the size of farms and preserving rural communities. On that point, the average size of a farm in the United States is 420 acres. Contrast that with a country such as Hungary, where the average farm size is seven acres and the policy works as follows. If you have a back yard with two or more trees in it and you intend to sell your plums, apples or pears, you are eligible for an EU subsidy. It seems rather a strange policy.

The issue of rural policy, then, is important and will continue to be debated. I sense a shift in this. It is interesting that in the run-up to the French presidential election, Marine Le Pen really challenged the whole basis of France’s membership of the common agricultural policy, possibly challenging the whole compact that has existed between urban and rural citizens.

The key to the future of this must be technology. On the one hand, a country such as Brazil has expanded its output by bringing more land into use, by taking established technologies from Europe and the United States, and by embracing GM cropping. On the other hand, we have to look at the choices around the technology of things such as biotechnology and how we introduce that. The choice that Europe must make is whether it wants to do this. Will it embrace or reject the technology? Under current EU policies, the need for EU-level approval of cultivation of GM crops—which at this time offers the greatest prospect of increased productivity—means that there is an impasse in the adoption of this technology. Rich countries such as Germany may wish to remain GM-free, confident that their economic strength will enable them to sustain a more expensive food policy. This is notwithstanding the fact that 35 per cent of the animal feed imported into Europe is GM and is in the food chain anyway. It is a fact of life that is already here.

Others may choose to accept GM crops but with adequate controls, as the noble Baroness referred to. In my view, this is a position that demands to be considered. We cannot stand back from this technological revolution. It would be rather like a handloom weaver in the 19th century saying, “I just reject all this” and society saying “We support you”. We would thereby have missed the great technological revolution of the 19th century, in which we played a key part and from which we went on to build industries, with prosperity following.

Neither the UK nor the EU is doing enough to build up the intellectual property that is needed to develop and sustain a green agricultural industry. Thirty or 40 years ago, the UK was a world leader in soil technology, plant breeding and, above all, the know-how to transfer the work of the laboratory into the hands of farmers. Yet there is currently no domestically owned manufacturer of heavy farm machinery—for example, tractors—in the UK and the technology of GM has gone largely to the United States and China. When we have spoken to people in the United States, I cannot work out whether they have been amused or bemused by the position of the EU on the adoption of GM foods. They cannot believe why we do not just get on with it.

In order for Britain to help other parts of the world, we need a more dynamic approach to agricultural technology. We can do some of the simpler things to help the developing world such as building better grain storage so that rats do not steal it, but we need technology to help improve the quality of soil and minimise the use of water and chemicals.

On the subject of overseas development, the Prime Minister's announcement to the G8 summit last June that we would commit £1 billion over three years to food security in the developing world was most welcome. It is interesting that the All-Party Group on Agriculture and Food for Development thought that the contribution should be 10 per cent of our total aid budget. It would be interesting to hear from the Minister how he feels we might get to that figure one day.

I am a naturally reluctant exponent of state intervention, but in the case both of the UK and EU, I believe that there is a strong case to be made for two things. The first is leading our citizens to make the choice on GM. If we do not, we will not get the right technology to meet the choice being made. If we decide to go GM-free, we will have to go one way; if we decide to embrace GM, we need to go the other. We need to make those decisions, push for these matters to become clear in the EU and then get on with it. We need then to support our R&D. If we look back at most technological developments, certainly in the 20th century when we moved into scientific development, we see that most of that basic research was generally funded by two groups, the state or people who had a monopoly-supply position such as the telephone companies, which had enormous research departments protected from market forces. I should like to hear from the Minister whether he can give us some comfort on continued support for R&D. GM or no GM, we need to step up our R&D so that we can create a green industry around solving the problems and helping to meet food needs worldwide.

Subsidiarity Assessment: Food Distribution (EUC Report)

Lord Carter of Coles Excerpts

Wednesday 3rd November 2010 Lords Chamber

[Lord Carter of Coles]

My Lords, I am grateful to the noble Lord, Lord Roper, for moving today's Motion. The EU Sub-Committee on Agriculture, Fisheries and Environment, which I chair, gave detailed consideration to the proposal in relation to the scheme for food for the deprived, which is the subject of the report now before the House. However, I am sure that your Lordships will share my appreciation of the knowledge and insight into the wider political and institutional context which the noble Lord, Lord Roper, has brought to this debate, not least in his role as chairman of the EU Select Committee.

It may be of interest if I quote from the website of the European Commission. The Commission's agriculture and rural development directorate-general states that the scheme was:

“Originally designed to provide surplus stocks of farm produce (‘intervention stocks’) to needy people, the scheme was amended in the mid-1990s to make it possible to supplement intervention stocks with market purchases in certain circumstances”.

In looking forwards, the Commission goes on to say, and this is very apposite:

“Now that surplus stocks are extremely low and unlikely to increase in the foreseeable future, the scheme should allow market purchases on a permanent basis, to complement remaining intervention stocks”.

I need hardly remind your Lordships of the consequences of the common agricultural policy 20 years ago when, as the noble Lord, Lord Roper, said, we had mountains of butter, milk, sugar, cereals and so on. At that time, it was a practical solution to let charitable organisations in participating member states distribute those goods to the poorest sections of the Community. For all that the process of reforming the CAP still has further to go—my sub-committee expects to look closely at reform options from the Commission at the end of the year—it is fair to say that the changes made since the 1990s have been constructive and far reaching. As the Commission has said, surplus stocks are now very low, and they are expected to remain low.

For the proposed EU scheme to work in future, food needs to be purchased on the market and then put into the distribution system. Twenty years ago, the scheme was based on the availability of surplus stocks; now, with no stocks, it looks as if we will just go out and purchase it. This transformation begs questions about the scheme's efficiency and about its relationship with the CAP. The Commission claims that the scheme helps to meet the CAP's objectives of stabilising markets and ensuring that supplies reach consumers at reasonable prices. We could discuss those claims, but they are not the issues on which this report turns. The central issue is our subsidiarity assessment.

Why should the European Union be considered to be in a better position to determine the nutritional needs of deprived members of member states' communities, and to respond to those needs, than national, regional or local governments? For example, here the Government have introduced the Healthy Start scheme, and I hope the Minister will say more about it. I mention it only because it seems to me to exemplify the role of a member-state Government in looking at the need in the population for which they are responsible and designing an appropriate scheme to meet those needs.

As we acknowledge in the report, member states' participation in the scheme is voluntary and, although the UK has not participated since the mid-1990s, the Commission states that 19 member states currently do. I am tempted to repeat the saying that there is no such thing as a free lunch, not because the scheme rests on cofinancing between member states and the Commission, but because, if we fail to flag up what we see as a failure to comply with the principle of subsidiarity, we risk paying a longer-term price in terms of blurring the lines between actions appropriate for EU involvement and actions which should rightly stay with member states at national, regional or local level.

The sub-committee was clear in its view that this proposal does not comply with the principle of subsidiarity, and I hope that your Lordships will share that view.