Agriculture Bill

Baroness Rock Excerpts

Report stage & Report stage (Hansard): House of Lords & Report: 1st sitting & Report: 1st sitting: House of Lords
Tuesday 15th September 2020 Lords Chamber

I very much hope that the Minister will be able to accept my first amendment to help to improve the environment and my second to help to preserve our increasingly marginal small hill farms. I may wish to press these amendments to a vote, depending on the Minister’s response.

[Baroness Rock (Con) [V]]

My Lords, I declare my interest as a director of Wrackleford Farms Ltd, a tenant farming enterprise. I shall speak to Amendment 42. The amendment, supported by the NFU, would ensure that farmers entitled to payments receive those payments within guaranteed timescales to help ensure certainty of cash flow. I thank my noble friend Lord Caithness for his support.

I said in Committee that any farmer will tell you that cash flow is their number one consideration. As a farmer, it is one thing to know that financial support will be reduced, but quite a different thing to know when that financial support will be received. Regulations relating to the phasing out of BPS therefore need to include clarity on when a farmer will receive payments.

While it is true that the existing payment windows will come over under retained EU legislation, Clause 9 gives the Secretary of State the right to modify the BPS legislation, including potentially by removing the payment window in place at present. We cannot have a situation where no payment window is set.

Furthermore, it is arguably the case that the current payment window under the CAP rules provides little recourse to farmers if the RPA fails to meet its payment obligations. This leaves farmers waiting an unsatisfactory length of time and in great uncertainty as to when payments will be made. The impact of these delayed payments cannot be overestimated. There is the financial impact: greater borrowing costs, lost business opportunities and less attractive prices for farm produce or inputs. But it also has a substantial impact on the well-being of farmers, their families and their relationships with their farm suppliers, which—importantly—filter down through the wider rural economy.

The payment window for direct payments is seven months: 1 December to 30 June of the following calendar year. Current rules state that payments have to be made only to the value of 95.24% of funds by that time. We all know that farming revenue and costs are both volatile; nothing remains the same month to month or year to year. The overwhelming message from farmers is that they need certainty over the timing of payments.

There need to be payment windows—or dates that Defra has to meet—either fixed in schemes or set out in individual agreements. This will allow holders of agri-environmental schemes to plan with great certainty and to manage their cash flow. It is not acceptable to ask farmers to undertake work at their own cost and to comply with associated strict time limits but then provide them with no certainty on payments associated with those works.

The government department BEIS has a prompt-payment policy that requires payments within a certain number of days: 30. I would welcome a similarly prompt-payment policy approach for agricultural schemes with guaranteed timescales. I hope the Minister will provide reassurance on this matter.

[The Earl of Caithness (Con)]

My Lords, while I thoroughly support the aims of this Bill and the direction in which the Government are taking us, I have to say that I get more and more concerned as we delve into the detail of the Bill and the experts who are farmers—such as the noble Lords, Lord Curry and Lord Carrington, my noble friend Lady Rock and others—expose the concerns that farmers face. It is for that reason that I support many of these amendments.

I tried to put my name to Amendment 36 in the name of my noble friend Lady McIntosh of Pickering, but there was already a full house of supporters. However, I supported this amendment in Committee and would do so again now. The argument is very compelling that the pilot schemes have only just started and it is going to take a long time for them to report and for the department to go through them, gestate them and work out what the future is. There would be very little time for the farmers to implement the results. Therefore, putting the whole thing back by a year would be a sensible, pragmatic and welcome solution to one of the many problems that the farmers face.

The noble Lord, Lord Carrington, made some very good points when he moved Amendment 37, which also deserves support. On the points made by the noble Duke, the Duke of Wellington, on Amendment 38, I reiterate that you do not have to be an organic farmer to protect the environment. You can farm in a perfectly normal way and bolster it. My main concern is Amendment 42, to which I have put my name and which has just been so well introduced by my noble friend Lady Rock.

The noble Lord, Lord Curry of Kirkharle, put it very succinctly when he spoke of sucking out the good of the department—I think those were his words. My concern is that as we move to ELMS, inevitably the department will move the good people into the new scheme and the less good people will remain with the old scheme. I hate to categorise the department in that way because all the members of Defra are good, but inevitably the really bright ones will be with the more attractive new scheme, and as the old scheme runs out, there will be an inevitable tendency for it not to receive the same attention that it gets now.

My noble friend Lady Rock was absolutely right to say that the one thing farmers need is certainty. As that support is reduced, so it is imperative that the payments are made promptly and on time. What recourse does a farmer have if he or she is made bankrupt because the Government, using taxpayers’ money, do not pay as they should? The area of financial support is hugely concerning and we must get it right. As the Bill stands, I am not convinced that we have got it right, which is why I support Amendments 36 and 42.