Agriculture Bill (Third sitting)

Colin Clark Excerpts

Thursday 25th October 2018 Public Bill Committees

[The Chair]

Q Mr Cross, as a farmer, do you have a view on this?

John Cross: I totally agree with several of the things I have heard about the quality, fertility and productivity of our soils. That is something that some in the industry and some areas of the country have slightly lost focus on, and it is something that I myself am very passionate about.

I do not farm in an area where flooding is a problem, so I do not have any experience there, but designing schemes to encourage or nudge producers into taking a more active role in managing the long-term stability and fertility of their soils has to be the right way to go, because the land’s ability to produce grass or food crops is entirely dependent on its health, structure and organic matter levels. It is the right way to go.

[Colin Clark (Gordon) (Con)]

Q This is a question to Mr Cross regarding electronic identification traceability, with which we are quite familiar in Scotland. ScotEID, which is based in my constituency, already covers cattle, sheep and pigs. The recent BSE case was very quickly closed down, and the cohorts were identified. It is testament to the Scottish authorities that they closed it down so quickly. The problem with such systems is that they must be robust, and the Government have not got a very good history of designing systems. Are you looking at existing commercial systems for EID traceability, which could be quickly implemented, rather than starting from the ground up?

John Cross: The answer to that is yes. If you look around the world, there is quite a lot of not-quite-off-the-shelf, buy-it-and-plug-it-in technology. High-calibre EID traceability systems are in place all over the world. To identify the equipment that would suit the industry best, we have already had an open supplier day to look at technologies and the potential suppliers of such technologies. In fact, 38 companies from around the world came and showed an interest. If we throw the door open, so to speak, and explain to the industry what we want to achieve and what outcomes this country is looking for, those that see themselves as best suited stay with the process. The aim is to procure the best proven system, rather than build one from scratch.

[Colin Clark]

Q As a supplementary to that, this is all about public money for public goods. Is animal health arguably a public good? Not only would traceability be important, in terms of trade, but traceability can prevent the catastrophes we have had with foot and mouth and BSE in the past, and the effect that sanitary restrictions can have on population movement. What is your opinion? Should animal health be seen as a public good because it is so necessary and affects us all?

John Cross: “Animal health” is a very complex phrase. You have got animal health from the point of view of the absence or presence of disease, and animal health from the point of view of making a judgment about animals that are sick—there is a welfare issue there, depending on the severity of the disease. Animal health is a wide subject. As I said earlier, animals that are suffering from various levels of endemic diseases can be regarded as suffering from that disease. They are highly inefficient; they are wasteful. Animals that are diseased have a higher carbon footprint than healthier ones. They produce less from the inputs they are given. It is like trying to run an industry with the handbrake permanently on. Nothing performs well enough.

From the point of view of the use of inputs, the future of the environment and the impact on climate change, you are much better off if you have a well-run industry producing very healthy animals extremely efficiently. At the same time, that enables you to do a better job environmentally. Inherently, the welfare of animals is enhanced by the absence of disease. It is all interlinked. Is it a public good? I would say yes. Not entirely, but yes.

[The Chair]

Before I revert to the Minister, are there are any more questions from the Back Benches? No.

--- Later in debate ---

[Kerry McCarthy]

Q May I also ask about whole farm systems? I have an amendment that relates particularly to agro-ecological and organic farming, which I am sure the Soil Association would support. You mentioned the concern that the approach might be piecemeal, with people doing things round the edges. How important is it to support a whole farming system, as opposed to focusing on individual public goods?

Helen Browning: In my view, whole farming systems such as organic farming or agroforestry are probably the most efficient way to support the public goods that we want, because they actually deliver them as an inherent part of the food production system. That is why I have been an organic farmer all my life: I do not want to be farming intensively in one place and trying to produce public goods in another. The integrated approach gives us a balance of food production with environmental care. We will still need to do special things in special places so that we can preserve species, manage floods and so on, but the agro-ecological approach should be at the core of our farming system. We know that we need to start moving away from pesticides and antibiotic use, and towards encouraging rotations and using less manufactured nitrogen.

I welcome the steer on climate change, which is incredibly important. We need to soak up more carbon in our soils and in our trees. We need farming systems that deliver those things, but at the moment that is not coming through strongly enough. It will be financially and physically the most practical way to do it, and it will give people a vision of the future that we can all sign up to. A drive towards using the new technology coming through, as well as traditional techniques, would feel really exciting.

[Colin Clark]

Q I declare an interest: I am a conventional farmer and an organic farmer, and I own fresh produce factories. I have been involved in farming for donkeys’ years.

Part 6 of the Bill is about fairness in the supply chain. Several retailers have moved to central direct buying, reducing the role of packers to, effectively, contract packers. That has been part of the problem with the oversupply of apples this year. The industry is already changing: instead of producer organisations having 12 months’ integrated supply, the supermarkets are now trying to do it themselves. How will the Bill rebalance that? If you do try to rebalance it, you must maintain the natural effect of the market—how else will you control supply? What does the Bill actually do to give real powers of fairness between the power of the supermarkets, where they are already squeezing out the existing supply chain?

Jack Ward: Growers understand that they are operating in a very competitive market and that is the way the world goes. We also have to recognise that we only supply for a part of the year. For growers, with the exception of one or two crops, it is a seasonal operation. Some growers are growing overseas and filling that gap. Generally they understand exactly how the supply chain works. I think I am right in saying that the Minister is charged with developing something around supply-chain fairness in the future. I think it is just about getting a better understanding between the two sides about what supermarkets need and what growers can supply.

This year has been a good case in point. We have been through a really difficult growing season with a very cold start and then a very dry middle period. It took quite a long time before people appreciated that what was coming off the farms would be different from a normal year, as a result of those weather conditions. It is about getting that understanding, acceptance and realisation that things might be different. You are not producing off a spreadsheet. Even if your spreadsheet says you will get x volume of y specification at z price, the season can interrupt that. There needs to be a grown-up discussion about how to accommodate that, rather than buyers turning their backs and saying, “Okay, we will have it in from America,” or wherever.

Helen Browning: I will just add a bit more to that. There is also a need in the wider industry for a real culture change around co-operation and how we work together, both through the supply chain and between producers themselves. In some areas, we have better integration and better co-operative working. In the “Health and Harmony” document, the co-op that I belong to—the Organic Milk Suppliers Co-operative—was cited as a very good case study, and that is absolutely right. Differentiating markets, being very clear of our purpose, being inventive and entrepreneurial, and working well in partnership will all stand us in good stead.

There is a real need to look at transparency and information clarity, which we have already talked about a bit today. I also want to mention the opportunity to shorten supply chains and create new markets through investing in the kind of infrastructure that we need, in order to allow farmers and growers to deal more directly with the consumers themselves. We need to do that efficiently, so that we do not end up with white vans and lots of capital investment on every farm. But I think there are ways of doing that through processing hubs and good distribution networks, and that could be revolutionary in ensuring that fresh food is available affordably and does not always have to go through the normal retail chains.

[Colin Clark]

Q Just to follow up on that point, with the likes of Amazon and eBay, or maybe even some internet or app-based system we cannot see yet—I remember suggesting it years ago to supermarkets, and they were furious, because they owned retail sites and did not want to hear about it—you could actually just about bypass normal retail chains completely. Mr Ward, you spoke about the Asda-Sainsbury’s tie-up. That is inevitable, because they think there is a much bigger competitor coming down the road, is there not?

Jack Ward: Yes. I think the fear from a grower point of view is that it just drives the price even lower. The real concern, if they are going to compete ultimately on price, is what that will do to the pressures in terms of trying to produce food in a sensible, balanced and economic kind of way. It does open up new opportunities, undoubtedly, but the big issue is whether it just moves even more of the grocery market into the discount sector. I think that is the real concern.

Helen Browning: The problem with the discount sector is not that it pays less to farmers, but that they are taking less margin themselves, and therefore the mainstream supermarkets feel they need to match those prices, and they squeeze harder. I actually think that a lot of the discount sector can be very helpful for farmers. Ocado and Amazon can work well for smaller-scale producers. As a producer myself, I sell a lot of stuff through Ocado, because it is very straightforward. They will list stuff very easily and they can have more Stock Keeping Units. Therefore they can offer a much wider range of produce than your mainstream supermarket can, so there are opportunities there. The threat is in the competitive pressure that is exerted on those big four supermarkets, which are still where the majority of food is sold.

[Sandy Martin]

Q Going back to what Kerry McCarthy was asking, do you believe that the production of a comprehensive food strategy could help inform any future regulations that will give effect to the Bill, in order to enable or encourage the production of sustainable and healthy food?

Helen Browning: I would like to think so because that is the other bit of the jigsaw. We are looking here at the production end and particularly at the support elements for farmers. We are not looking at the trade environment, which is going to impact hugely on this, and we are not looking at what is going to happen at the market end or at what will happen through the rest of the supply chain.

In an ideal world, we will be looking at all these bits of the jigsaw together and seeing how they fit together. It is very hard to get this bit of it right with only that base camp in terms of how we will affect farmers’ support into the future. We have no idea of the levels of support that there will be, and that is obviously a factor. The need for it will be influenced by what happens to the trade environment and the market more widely.

It is kind of tricky to do this. What I would ask, given that we do not have that clarity, is that we give broad powers and start to think about the targets. Introducing targets into the Bill would actually give us some destination point and allow the powers to be used in the right way, depending on what else comes through over the next year or so.

Jack Ward: One of the criticisms I have picked up from talking to producers is the lack of reference to food and the promotion of food in the Bill. I think that the food strategy gives the Government the opportunity to redress that issue and spell out a vision for the food industry in the UK. It is our largest food-manufacturing sector; there are opportunities there—there are economic opportunities—and we seem to be at a really good point to take advantage and capitalise on them. I think the food strategy could be hugely influential and send a really important message of confidence throughout the industry.