Agriculture Bill

Baroness Scott of Needham Market Excerpts

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

[Baroness Scott of Needham Market (LD) [V]]

My Lords, in 2016, before the referendum, I chaired the EU Energy and Environment Sub-Committee. We carried out an inquiry into resilience in agriculture, so I can say from the beginning that I agree with the noble Lord, Lord Carrington, that insurance is quite often not an appropriate solution for farmers, however it might appear to be so superficially.

Having said that, I find these amendments somewhat problematic. I will explain why. First, it is because the Bill as drafted talks about the disturbances being acute. The amendments would add “chronic” to the description of the disturbances, but all the interventions have been about the results of that disturbance. To my mind, that is quite an important distinction, because you could have a short-term problem with a long-term impact. I am not clear whether, as drafted, this talks about the original problem or the impact.

I am also genuinely unsure why existing provisions are not good enough. I heard with some interest what the noble Baroness, Lady McIntosh of Pickering, said, so I look forward to the Minister clarifying that, but this is one area where I feel the Government have farmers’ backs in the event of these sorts of disturbances. I do not recall seeing anything from the NFU on this so I am not sure it regards it as a big issue, but perhaps when he winds up the noble Lord, Lord Carrington, will enlighten me on that.

I am reassured that the amendment would provide a power, not a duty, because a duty to continue to offer support for a “chronic” disturbance could be for years and years. I do not think that would be appropriate; I would be pleased to see it as a power and not a duty. Nevertheless, the Government can move quickly when they need to, as they did in bringing in the furlough scheme, for example. I am not entirely convinced by these amendments, I am afraid.

[Lord Grantchester (Lab)]

I thank the noble Lord, Lord Carrington, for returning to the subject of crisis management in his amendments. The clauses in Chapter 2 bring further into domestic legislation the powers that the European Commission exercised to provide emergency assistance in extreme market circumstances. The Secretary of State may modify the retained direct EU legislation from the withdrawal Act. This would usually involve intervention on storage. At this stage, once again, as I join another day’s proceedings on the Bill, I declare my interest as recorded in the register as being in receipt of funds from existing systems derived from the CAP.

We noted the Minister’s reply in Committee that

“farmers already manage the effects of fluctuating everyday weather conditions”,

and that the existing powers contained here and elsewhere

“are sufficiently broad to ensure that agricultural producers will be covered”

should it be necessary to provide emergency financial assistance

“due to exceptional market conditions”—[Official Report, 21/7/20; col. 2184.]

brought about by unforeseen economic, environmental or welfare factors.

The term “chronic conditions” is interesting, as this would suggest exceptional circumstances becoming endemic and longer lasting. This would suggest that the market would need to adapt on a wider basis after any exceptional market disturbances caused by economic or environmental factors had been provided. It would suggest that the adverse effect on the price achievable for agricultural products may not return to normal. This circumstance would become subject to far more extensive dialogue and analysis, and when such a situation may warrant the actions wanted by the noble Lord, Lord Carrington, needless to say it would be controversial and subject to much debate.

We understand that Welsh Ministers are aware of these details and have not drawn attention to any aspect with which they are uncomfortable. The Minister has advised the House that the Welsh Government have agreed to these provisions; that would be our position also. We are generally content with the current drafting. I thank the noble Baroness, Lady Scott, for her remarks, which reflect many of our thoughts.

--- Later in debate ---

[Baroness McIntosh of Pickering (Con)]

My Lords, I rise in the absence of, and at his request and with his permission, the noble Lord, Lord Empey, who has been unavoidably called away and sends his apologies. His two amendments refer to Clause 27. They are minor amendments but would have significant consequences.

The clause relates to fair dealing obligations of business purchasers of agricultural products and enables the Secretary of State to make regulations in respect of them. The regulations may be sector specific or in general terms. As we learn from the Bill’s Explanatory Notes, the Bill provides the Secretary of State with the power

“to make regulations to introduce obligations that promote fair contractual relationships between primary producers, producer organisations, associations of producer organisations, produce aggregators and the business purchasers of their products.”

Obviously, there is a great desire for fairness and for protection from unfair trading practices.

At the kernel of the two amendments from the noble Lord, Lord Empey, is a wish to ensure a better relationship between the processors, the supermarkets and primary producers. I am sure that this is a concept with which all noble Lords agree. Rather than press his amendments at this stage, he seeks to ensure that we enable primary producers to make the investments they wish to make to meet the new responsibilities they face as set out in Clause 27.

The noble Lord, Lord Empey, went to great pains to state, and I am sure that he has reassured my noble friend the Minister of it, that rather than press the amendments to a vote at this stage, he is grateful for the opportunity to set out the views expressed in them and seeks an early meeting with the Minister if it would be possible. I beg to move.

[Baroness Scott of Needham Market (LD) [V]]

My Lords, I had an exchange of emails yesterday with the noble Lord, Lord Empey, to make sure that I understood his amendments correctly. He basically put it to me that he wishes to place an obligation on government rather than for it to have a discretion, which is as the Bill is drafted, to make regulations on fair dealing. I have told him that I support the fair dealing provisions in the Bill—I said so in Committee—particularly with regard to food waste, which is often in effect forced on farmers, making them less competitive and environmentally more wasteful, by the requirements of supermarkets, which I do not think is fair dealing. I am all in favour of that, but I am less convinced about the placing of such an obligation on Ministers. However, these issues can be well discussed in the next set of amendments, about the role of the Groceries Code Adjudicator.

[Lord Grantchester (Lab)]

I thank the noble Lord, Lord Empey, for his amendments, for the significance in which he holds them as necessary for the Bill, and for leading the House in returning to Clause 27 on fair dealing obligations. I am sorry he has not been able to stay tonight to make his case due to personal circumstances, and I hope all continues well. Nevertheless, I thank the noble Baroness, Lady McIntosh, for stepping in and moving his amendment. I concur with much of what she said. The distribution of market returns from food between the primary producer and the rest of the supply chain, especially in regard to the retail sector, certainly appears unbalanced. The proportion returned to the farmer has steadily declined over many years.

That regulation is needed to ensure further provision to introduce a greater measure of fair dealing obligations on the supply chain is recognised in Clause 27. Following the establishment and workings of the Groceries Code Adjudicator, the specific task of monitoring relationships between the UK’s largest supermarkets and their direct suppliers has proved very effective. I would go so far as to say it has proved critical in delivering effective change down the supply chain.

We would not be able to support the noble Lord should he wish to press his amendment. The specific details of each statutory code are being developed in consultation with industry and will be set out in secondary legislation. It will be extended across all sectors of agriculture. This is already in progress.