Direct Payments to Farmers (Crop Diversification Derogation) (England) Regulations 2020

Daniel Zeichner Excerpts

Wednesday 3rd June 2020 General Committees

[Daniel Zeichner (Cambridge) (Lab)]

It is a pleasure to serve under your chairmanship, Mr Hosie. I extend a warm welcome back to the many people who spent many happy hours in this room a few months ago, discussing the Agriculture Bill. As the Minister accurately explained, at the time, we were suffering a period of intense rain; now, of course, we are suffering from drought. It seems like quite a long time ago, but there is no doubt that the awful impact of the floods caused by Storms Ciara and Dennis was intense. You will be relieved to hear that we will support this instrument, and there will be no need for a Division, Mr Hosie.

Let me take the Minister back to a happy discussion that we had in this place on 3 March, when we were debating clause 9 of the Agriculture Bill, and I quoted Farmers Weekly to her. Minette Batters, the president of the National Farmers Union, said at its conference that farmers were hugely frustrated:

“We have left the EU, half the country’s under water and we are still going to abide by”

the three-crop rule

“and process thousands of force majeure claims. It just seems absolutely extraordinary.”

My question to the Minister is: why has it all taken so long? Why so slow? In her answer that day, she hinted that there was a range of technical difficulties, and that things would happen soon. That was March, and here we are in June. I can offer some suggestions as to why it took so long. Of course, when the same thing occurred back in 2018, we were members of the EU, and we sought a derogation from the European Commission. Life is not so simple now; it is much more complicated. We have the complexity of the Direct Payments to Farmers (Legislative Continuity) Act 2020, its relationship with the retained EU legislation, and the need to remain World Trade Organisation compliant, so I can kind of understand why this is difficult, but there is a marked contrast with what we were told in December: “It’s all so easy—it’s oven-ready!”. Frankly, even just this little bit of the process looks like a dog’s dinner. A lot of time is going to be spent in Delegated Legislation Committees over the coming months discussing the complexity and cost of the scheme.

The cost is another thing that I want to ask the Minister about. She may tell me that my analysis of why the change has taken so long is incorrect—if she has another explanation, I would like to hear it—but I would also like to hear about the cost to farmers. Delayed decisions cost money, and there are those who did not know what the outcome of this discussion would be. Some bought seed—some, I am told, at higher prices than normal—so there are consequences to these delays. Has an assessment been made of the cost of that? If not, it would be interesting to understand why.

I listened very closely to the Minister, as always, and I am well aware that the three-crop rule is unpopular with many farmers, but it was introduced for a purpose. The greening element of the direct payment system was an attempt to tackle the increase in monoculture that we see right across Europe. Many say that it is a blunt instrument, and I do not disagree, but it had a serious purpose. Some will say that we do not need it here, and others will say that we do, but I hope we all agree that we want to challenge those monocultures. In a sensible rotation system, that rotation would be part of good farming practice.

I suspect that the Minister knew that I would come armed with my favourite document. Under the new system that we discussed at length a few months ago, is it possible to imagine an environmental land management scheme that does not encourage this kind of good farming practice? We certainly do not want to encourage a further move to monoculture. Furthermore, under that system, will there be a process for similar derogations in the event of extreme weather conditions? I do not think she will be able to answer that—I expect she will say tell us that this is an iterative process—but I ask it to make it clear that designing interventions to achieve these ends is often harder than it looks.

That raises a further question. As I say, the three-crop rule was a blunt instrument, but today we are approving a derogation that potentially undermines the greening intent in parts of the country that were perhaps not so badly affected by floods, with the purpose, absolutely rightly, of helping those who were badly impacted. Will the Minister tell us what plans there are to avoid this kind of situation cropping up in the future? In a spirit of constructiveness, I suggest that a more regionalised approach in England could be helpful, or could even achieve the baseline environmental standards that Labour argued for in the Agriculture Bill. The greening intent of the greening measures was to tackle some of the very causes of the extreme weather we are suffering from. We have a climate crisis, and we should be careful that, in dealing with the immediate consequences, we do not undermine the very tools we are trying to put in place to minimise the risk of such occurrences in future.

We are in the special position of benefiting from the excellent discussion that took place in the House of Lords yesterday. There were many excellent contributions, but one or two points from that discussion are worth teasing out. In the other place, the Minister—Lord Gardiner of Kimble—rightly said in his opening statement:

“Having up to 30% of their payment at risk would be a significant financial burden for farmers to bear and cause considerable worry.”—[Official Report, House of Lords, 2 June 2020; Vol. 803, c. 1297.]

I totally agree with him, but I wonder whether the Minister before us could explain why those worries are different from the worries of those who face similar losses over the next couple of years during the move to a new system. I also note that a number of contributors yesterday picked up the point about extra costs caused by uncertainty—so much so that some called for clarity for next year, on the basis that decisions will need to be made very soon.

The Minister said clearly that this measure is for this year only, but when I listened to the Minister in the Lords winding up yesterday, it seemed a little more complicated than that. He said he had been asked

“how any BPS changes will be made after 2020. We will of course use powers in the Agriculture Bill. The Government intend to bring forward SIs to continue the direct payment schemes for the 2021 scheme, to begin to phase these payments out and to simplify the schemes. I fear that this will require rather more than one SI, but I have sympathy with all noble Lords looking to minimise the number of separate statutory instruments, within reason. The Government have said that the simplifications for 2021 could include removing some or all of what I would describe as burdensome greening rules. Removing these rules would, for example, avoid the need for an SI next year to derogate for crop diversification rules should—I emphasise ‘should’—extreme weather occur again.”—[Official Report, House of Lords, 2 June 2020; Vol. 803, c. 1310-11.]

That is not all that terribly clear to me. It seems to suggest that a very complicated picture is emerging, in which there is a mixture of retained EU law, sustained by the continuity Act and related SIs, and the so-called burdensome environmental elements, possibly modified through clause 9 of the Agriculture Bill—but with that being dependent on extreme weather. Obviously, we all hope that we do not have extreme weather next year, but it seems unclear whether the short to medium-term approach to basic payments includes the three-crop rule. Perhaps the Minister can clarify that.

I conclude by observing that this all seems very slow; it takes many months to do simple things. That seems to be a problem that the Government have in other areas as well. We have a climate emergency; we do have extreme weather, and it is of course important to help where we can, which is why the Labour party supports the derogation today. However, we must also be careful to not undermine environmental measures that are designed to tackle that crisis.