Common Agricultural Policy

David Heath Excerpts

Thursday 1st November 2012 Westminster Hall

[Kerry McCarthy]

I thought for a moment that my hon. Friend was congratulating you, Mr Chope, on introducing that concept, and I wondered whether I had missed something. Yes—a one-nation CAP reform. That is our slogan for today.

If the concerns raised by environmental organisations are not addressed, there is a danger that the CAP, which has demonstrably made some progress over the past 20 years—albeit painfully and slowly at times—could, as part of a process intended to improve its environmental performance, perversely be taken backwards. I am glad to say that there is general agreement on the need to green the CAP, which I regard as absolutely necessary if we are to achieve three objectives: first, to support more long-term sustainable food production; secondly, to address the ever-increasing challenge of global food security; and, thirdly, to meet our environmental goals, which range from halting and reversing biodiversity declines by 2020, to meeting our climate change targets.

Greening of pillar one payments must happen and, at the same time, pillar two must be fully protected or ideally, increased. The added justification for those changes is, in the words of the RSPB’s evidence to the Committee’s inquiry, to

“legitimise expenditure of €300 billion over the next seven years.”

That is a huge sum of money. We know from yesterday’s debate on the EU budget just how much concern there is in this place, and among the wider public, about EU spending, of which the CAP is the largest single component. I agree with the Committee’s conclusion that it is a concern that greening may be seen by the Commission as a way of justifying the significant public expense of its policy on direct payments, rather than a way of delivering environmental improvements across the EU. I hope that the Minister will devote some time to that concern in his response.

There is also concern, as there is in relation to other areas of Government policy, that this could become an exercise in so-called greenwashing—greening in name, but not in outcome. Greening must be designed and implemented in a way that secures genuine environmental improvements at farm level and across all member states. There are worrying signals that the member states want to maintain the status quo but to repackage the status quo as green when it is clearly not. The Luxembourg paper contains some strong examples of that. The measures suggested by 16 member states in that working paper, published in April, are even worse in delivering environmental outcomes. In particular, the section on farmers who are “green by definition” has raised concerns. Arguing that a farm is automatically green just because a certain proportion of it is grass is nonsensical, as there is huge variation.

[The Minister of State, Department for Environment, Food and Rural Affairs (Mr David Heath)]

indicated assent.

[Kerry McCarthy]

I am glad that the Minister is nodding. I hope that he repeats that when he comes to make his speech at the end of the debate. Grassland can be managed in a way that is good for the environment, but can also include reseeded and extensively managed grassland, which does not deliver comparable environmental benefits. The UK was one of the member states involved in that document. I am pleased that the Government have since distanced themselves from it, saying that the UK was not a co-signatory, but just wanted to move the Commission’s thinking forward. I hope that the Minister will use this opportunity to clarify that again.

One argument that we are hearing a lot, including from the Country Land and Business Association and the NFU in the UK, is that farmers in agri-environment schemes should be counted as “green by definition”. It is true that there are many good examples of what those schemes are achieving in the UK, but there are two problems. First, there would be no environmental additionality from such an approach, and that is badly needed. Secondly, it would in effect involve double funding. Farmers would be paid once via their agri-environment scheme payment—paid for under pillar two—and paid again from their new greening payment, when the new CAP comes into force, under pillar one. Therefore, although it is important that greening and agri-environment schemes work coherently together, I do not think that “green by definition” is the answer.

Let me move on to talk about flexibility. The Select Committee and the Government agree that a one-size-fits-all approach is not appropriate. The Select Committee Chair, the hon. Member for Thirsk and Malton (Miss McIntosh), talked about that in some detail today, as did the hon. Member for Banff and Buchan (Dr Whiteford). It is only practical for there to be flexibility so that environmental measures can be tailored to local environmental and agricultural conditions. I would very much support that approach. However, there are some dangers with too much flexibility.

I can see that, for the UK, a flexible approach makes most sense, as we are leading the field with our higher-level stewardship schemes and would most likely use that flexibility to deliver positive environmental outcomes. However, if member states are allowed the full flexibility that they are calling for to implement greening in their own way, that flexibility could extend even to determining what counted as green. That could allow member states to kick out the Commission’s greening proposals and do what they liked, and sadly in many EU countries that could amount to next to nothing. The NFU has also raised concerns about that, but from a different perspective. As the report outlines, the NFU is concerned that DEFRA may impose more stringent greening measures on UK farmers that would not apply in other EU countries.

As I think the hon. Member for Tiverton and Honiton (Neil Parish) said, it is very important that we achieve the level playing field that is talked about so often when it comes to EU matters. I therefore support the calls from a number of environmental bodies that there should be a common framework that every member state must deliver, with flexibility to tailor implementation to local circumstances. A free-for-all on greening is not the best outcome for the environment in the EU.

Let me deal briefly with ecological focus areas. It is perhaps in the Commission’s proposals for EFAs that a common approach has best been mapped out and could make the best contribution to realising the ambition of greening the CAP. There is criticism outlined in the report about the proposed percentage of a holding that would be included in EFAs, with concern that that would mark a return to set-aside and severely limit increases in food production and competitiveness. However, as many environmental organisations have pointed out, because it could include a wide range of landscape features and low-grade agricultural land, which may already be under some form of environmental management, it would not necessarily mean taking significant areas of high-quality arable land out of production.

EFAs could have significant potential to make the direct payments that farmers receive from pillar one of the CAP deliver more for the environment. By including in EFAs important landscape features of the countryside, such as hedgerows, and ensuring that EFAs help to protect and maintain them, the character of our farmed landscapes and their wildlife could be greatly enhanced. However, the proposals would not achieve that aim and would need to be carefully designed and implemented to deliver real environmental benefits.

Lastly, I would like to raise an issue outlined by the CPRE. It stresses the need to ensure that the environment does not lose out when it comes to allocating funding to rural development measures under pillar two. Ensuring that pillar two is adequately funded is essential not only for green farming schemes, such as environmental stewardship, but to ensure that enough rural development funding is available for measures that support local food producers to boost economic sustainability in rural areas. The CPRE recently mapped the links between those who produce, process, buy and sell food sourced locally. It found that local food networks could be contributing £6.75 billion of value to local economies.

That is particularly important in Bristol, one of whose seats I represent. We recently held a mini food summit, bringing together organisations such as the CPRE and the people running Bristol’s green capital bid, which I very much hope we succeed with next year—it may be third time lucky. We were talking about how we could bring together people working in the food sector across Bristol as a hub for the south-west. The shadow Farming Minister, my hon. Friend the Member for Ogmore (Huw Irranca-Davies), was there, and I think that he would agree that it was a productive discussion in terms of how we can look at sustainability issues, encourage people to grow food locally and tackle food waste, which I have not mentioned today, but have spoken about on many other occasions. Obviously, that is also an issue in the EU. It is important to us locally that we look at how we can support local food networks.

The Select Committee says that DEFRA must redouble its efforts

“to find, engage and secure reliable allies across the European Union”

and have the resources in place

“effectively and persuasively to put the UK’s case that the CAP should support…the agricultural sector and provide environmental protection.”

I totally support that conclusion. I am somewhat pessimistic about what can be achieved, but I urge the Minister to throw his weight—his much-diminished weight, it must be said—behind our efforts to ensure that real progress on environmental issues can be made as part of this process.

--- Later in debate ---

[The Minister of State, Department for Environment, Food and Rural Affairs (Mr David Heath)]

Thank you for calling me to speak, Mr Havard. I do not deal in soundbites; I deal in solid policy and solid negotiation. We will leave soundbites to the hon. Member for Ogmore (Huw Irranca-Davies).

It is a delight to serve under your chairmanship today, Mr Havard. I also want to say a big “thank you” to my hon. Friend the Member for Thirsk and Malton (Miss McIntosh), the Chair of the Environment, Food and Rural Affairs Committee, first for committing her Committee to the report—the very compendious report—that it has produced, and secondly, for having the good sense to apply for the opportunity to debate it here in Westminster Hall today. It has been extremely useful for us to debate the report, not least because my official title is the Minister of State, Department for Environment, Food and Rural Affairs, so I am responsible for both agriculture and the environment, and it is nice to have a topic that clearly places both parts of my job description in the frame.

I am grateful to my hon. Friend for making it clear in her early remarks that we have these priorities of food security and climate change, and they are part of our background thinking in this sector. I am also grateful to her for drawing attention to the difficult weather conditions in the past few months, which unfortunately may continue, and to the need for certainty. Nothing would please me more than to say—through her to the farming communities, the people who are looking at this debate in terms of social policy and the people who are desperate to have answers to the environmental questions—that we have a degree of certainty, but the reality is that we do not. The negotiations that we are involved in are still very much in play and I will try to give the House the benefit of our experience, to say where we are and what our objectives are. However, I am afraid that what I will not be able to do, with any degree of certainty, is to say where we shall end up, because there is still an awful lot to play for.

I start by making it clear that the Government are very much in agreement with the majority of the EFRA Committee’s findings and with the conclusions in its report; that was also very clear in the formal Government response to the Committee’s report. If I may paraphrase, the Committee’s two key conclusions are that the UK’s existing agri-environmental schemes should not be undermined by greening, and that greening should be applied in a simple, flexible way that recognises local circumstances. As I say, we could not agree more with the Committee on either of those aspects. May I say how much I value the agri-environmental schemes that we have in this country? It is not being complacent to say that they are of a very high standard and that in many ways we achieve a higher level of outcome than many other EU member states.

Of course, I would always like us to do better and there are ways in which we can continually improve, not least by recruiting more people to higher-level stewardship schemes, but I will not say anything other than that we do a pretty good job at designing those schemes and we have done so for some time. The hon. Member for Ogmore said “Happy 50th birthday” to the common agricultural policy. I am not sure that that many people will be lighting candles in support of that contention, but I hope that more people might like to have a small celebration at the 25th anniversary of the groundbreaking agri-environmental schemes in England. I want to make it plain that we want to preserve and extend that legacy for future generations.

[Huw Irranca-Davies]

In light of the earlier comments by various hon. Members today, does the Minister agree that the success of the HLS schemes—albeit they might need to be tweaked again as time goes by—and the welcoming of that success is a result of DEFRA officials being out there on the farms, in the fields, with people, fine-tuning the schemes until the eleventh hour to get them right? Actually, the success of those schemes gives us a lesson about the need for there to be as much subsidiarity as possible within the CAP reform greening proposals. They need to be worked in the UK, for the benefit of UK farmers and the UK public.

--- Later in debate ---

[Mr Heath]

The hon. Gentleman is absolutely right. Mr Havard, we are going to have an embarrassing degree of consensus in Westminster Hall today on an awful lot of this material, because we have very strong common ground across the political parties and across the nations and regions.

I must say that it was not always so. When agri-environmental schemes were introduced, I remember that in my part of the world in particular there was a huge outcry about the “imposition”, as it was described, of agri-environmental schemes on the Somerset levels. People were very upset about what was happening, and then effigies of Ministry of Agriculture, Fisheries and Food officials were burned on the levels. We get very excited about these things in my part of the world—we are all revolting peasants at heart.

[Neil Parish]

indicated assent.

[Mr Heath]

My hon. Friend will agree with that contention, as I know where he comes from.

The confidence in agri-environmental schemes is, as the hon. Member for Ogmore says, the result of careful preparation and consideration, as well as ensuring that everybody understood not only what they were to do, but the reasons why they were to do it and why the schemes would have an effect.

That is partly the answer to the point made by my hon. Friend the Member for Thirsk and Malton about modulation. From our point of view, it is essential that we are able to ensure the continuation of these schemes, and the way that we can do that is to make sure that there are the funds within pillar two that enable us to maintain them. It is not just the agri-environmental stewardship schemes that matter, although they are important. It is also through one of the other things that she mentioned—the rural development programme for England—that we can deliver the other added benefits and the public good, by the use of modulated payments. We must be very conscious of that.

My hon. Friend also made a specific point about the exit from the schemes. I hope that the Government response to the Committee’s report set out the position of someone who has signed up to a 10-year involvement, which is clearly the legal position. However, if difficulties arise after we have concluded the negotiations and if the new schemes clearly require us to look again at transition, I will be happy to talk to her, the rest of the Select Committee and indeed other interested parties about that, to ensure that people are not penalised for something that is outwith anything that they might reasonably have expected. That is because my determination is that farmers who enter into agri-environmental stewardship schemes have the confidence that, in doing so, they are not shackling their businesses to something that they do not want to do and are not making a rod for their own back. Instead, they should have the confidence that the scheme will continue and will provide the support they need for them to do the things that they want to do, both in running their businesses on that land and in achieving the environmental benefits for the wider good. I happily give my hon. Friend that assurance.

[Miss McIntosh]

What would be helpful is a letter of clarification. Perhaps I am misinterpreting the Government response, but when it so clearly states that

“there is no legal basis for allowing farmers wishing to withdraw”,

does that refer to an existing scheme or a new scheme that they are about to sign up to, which will then be an existing scheme from which they may wish to withdraw if the greener proposals are more advantageous to them? As I say, a letter clarifying that issue, which we could place in the Library, would be most helpful.

[Mr Heath]

I am happy to give my hon. Friend a letter. Again—I am not trying to avoid the question—there may be some uncertainties at the moment, as we are discussing transition, a key issue, with the Commission. It is giving us all sorts of potential headaches in the administration of schemes. We have a limited time horizon, and we simply do not know at what point new arrangements will kick in and what those new arrangements will be. Until we know that, it is difficult to make longer-term plans. However, I will happily write to her and set that out if it is helpful.

[Huw Irranca-Davies]

I get the hon. Lady’s point. What we need clarity on—I understand if the Minister cannot give it today—is where the cut-off point is and at what point in the process it occurs. We need that clarity so that we and he can encourage farmers to keep signing up for existing schemes without fear that they will lose out.

[Mr Heath]

The hon. Gentleman has grasped that we need to understand from the Commission what will and will not be acceptable. We need to know how we can make a satisfactory transition. I assure him and my hon. Friend that my intentions are to maintain that continuity in a way that is fair to everybody. I am not resiling from the difficulties; I am simply saying that we are trying to find ways of ensuring that that is the case.

[Miss McIntosh]

To make it simple for the Minister, we want an assurance that he is saying what the outgoing Minister for Agriculture said: that farmers will be able to exit. I am detecting a change of position.

[Mr Heath]

There is no change in position. I am simply saying that we certainly want to ensure that people are not penalised. However, we will not be happy if people enter stewardship schemes and then try to exit for no good reason when there is no substantive change from the new arrangements—if they simply say, “We signed up for 10 years, but we now think that it is in our interests to bail out after two,” for unconnected reasons. I will write to my hon. Friend and copy in the hon. Member for Ogmore to ensure that there are no difficulties in understanding. Perhaps I am not expressing myself well.

[Mr Dai Havard (in the Chair)]

For the record, my understanding is that this discussion has been about Select Committee recommendation 28. The answer is given on page 9 of the Government response. Anybody outside who may have been listening to the runic, delphic discussion that has just gone on will have some idea of what we have been talking about.

--- Later in debate ---

[Mr Heath]

I am grateful to you for setting that out, Mr Havard, but I have to say that anyone who hopes to follow all the ramifications and tergiversations of the common agricultural policy negotiations will need those pieces of paper in front of them to have any chance of understanding much of what we are talking about. Having said that, let us try to express ourselves.

I will now be even more runic, because the hon. Member for Banff and Buchan (Dr Whiteford) asked me about the effect of the rebate. Anyone who tries to explain how the rebate works inevitably ends up confusing everybody. I will simply say something about it, I hope without entering into a longer discussion, because we will all get confused.

If part of pillar one is greened, that will not affect the rebate. Even if we manage to secure a transfer of the greened component from pillar one to pillar two, it still would not have any impact, because all pillar one expenditure and all pillar two expenditure originating in pillar one counts toward the rebate calculation. I hope that the hon. Lady finds that helpful. Looking at her, I am not sure whether she does. Again, I can provide further information later if she likes.

I move to one of the key underlying issues of this debate: the Committee’s ambitions for simplicity and flexibility. Those are fundamental to the Government’s position on greening. We seek to ensure that the administrative burden is low for farmers and administrators. For farmers’ sake, we do not want to gold-plate—as my hon. Friend the Member for Thirsk and Malton called it—any proposals introduced, but the thrust of Government policy has been exactly in the opposite direction.

My hon. Friend mentioned the Macdonald review, but I think that it delivered some sound suggestions about how we could reduce the impact of red tape on the farming community. We are making good progress on implementing them. I am afraid that farmers do not always recognise when that has been done, because when they no longer have to fill in a form that they used to have to fill in, they do not notice. We may need to make people better aware of the fact that we are proceeding with that as fast as we can. Sometimes it will need changes in legislation, which will take a little longer, but wherever we can, we are trying to implement the Macdonald review. I have regular meetings with Richard Macdonald to ensure that we keep up with his timetable.

[Mr Dai Havard (in the Chair)]

Eilidh Whitehouse.

--- Later in debate ---

[Mr Heath]

It is certainly an awful lot better than the pronunciation of the hon. Lady’s constituency from the hon. Member for Ogmore, so I would not worry too much, Mr Havard.

The hon. Lady is right. To be absolutely clear, one of the big bones of contention in the negotiations is that we think the Commission’s direction of travel on the issue is precisely wrong, and we have to push very hard back the other way. One of my drivers for that—I am sure my counterpart in Scotland feels the same way—is that I simply want to ensure that we can implement the CAP effectively and efficiently when it is introduced. I do not want the Rural Payments Agency in England to go back to the dark days of a few years ago, when it was incapable of doing the job set for it because it was insufficiently well equipped to meet the complexities. I want to ensure that on the day when the arrangements are implemented, whatever they may be, we can deal with them. That means a long implementation time and simplicity in the construction and design of what is proposed.

[Huw Irranca-Davies]

Will the Minister return to the point that I raised about the Commission’s impact assessment suggesting that the proposals would add about 50% to the costs? He can extrapolate from that to complexity and bureaucracy as well. Is it his intention that the final outcome of the negotiations will entail no increase in complexity or costs to farmers, or will he accept some complexity if that is the only way to finalise negotiations?

[Mr Heath]

There are all sorts of competing interests. The hon. Member for Bristol East (Kerry McCarthy) is keen to ensure that member states cannot simply slide away from the commitments that they make. It is difficult to answer on what the final outcome will be. We are clear about our objectives, which are to simplify the proposals dramatically to achieve the environmental objectives, but with enough flexibility to ensure that we do not engage in complications that would jeopardise some of the things that we have in this country. We certainly do not want to increase costs. At the moment, I can give no assurance to the hon. Gentleman about the result of the negotiations. All I can give him an assurance of is our best endeavours toward that end.

[Huw Irranca-Davies]

I seek the Minister’s graciousness in giving way again only to highlight the fact that his answer sounds remarkably like the answer that the Opposition gave when we were in government, which was, “We would love to have no increase in regulation, but there just might be some, because that might be where we end up.” We took a lot of flak when we were in government over regulation and gold-plating. Sometimes there is good regulation as well.

[Mr Heath]

There is, but it must achieve the right objectives, and our concern about some of the proposals is that they increase the complexity and the regulation and do not achieve the beneficial effects. That seems axiomatically wrong, and I think the hon. Gentleman is agreeing with me.

[Huw Irranca-Davies]

Absolutely.

--- Later in debate ---

[Mr Heath]

I note what the hon. Gentleman says about flexibility. That is certainly what we are trying to achieve. We want the flexibility to apply practical, effective and simple measures for our farmers. I thought that he ended a sentence in his speech with, “We want flexibility in the United Kingdom but not in other nations”. I thought, “Right. Yes, just stop there,” but I do not think that that is an achievable negotiating position. To be fair, he did carry on with his sentence.

Let us be absolutely clear: we want to achieve an environmental benefit across Europe, but we do not want to lose our high standards. We are engaging, therefore, with the European Commission, the European Parliament and other member states to ensure that there is flexibility in the EU’s approach to greening.

My hon. Friend the Member for Thirsk and Malton requested an update on the process. It will be extremely difficult to offer the precision that she requires. Many different views are being expressed within the Agriculture Council and the European Parliament, and much will depend on the outcome of the overall budget negotiations. As Members have already said, until that budget is completed we will not know what the quantum is, and it would be difficult to resolve many of the CAP issues without knowing the size of that envelope.

There is a move by the Cypriot presidency to achieve a partial general agreement, before the end of the year and the end of its EU presidency. Such an agreement will come about only if we are satisfied that we have something that is sustainable in all its senses, and as far as the UK is concerned I think that we are some distance from that. I expect—this is no more than an expectation—that it is more likely that we shall come to a conclusion during the Irish presidency, following the conclusion of the budget round.

My hon. Friend the Member for Thirsk and Malton asked whether we have allies. Yes, we do. As always with European negotiations, there is a constantly changing kaleidoscope on different issues, but there are member states that clearly understand our points about flexibility and complexity and about how we can achieve the results, rather than focusing on an incomplete understanding of how we can best achieve better environmental benefits across Europe. It would probably be unhelpful at this stage in the negotiations to be numbering our friends and our enemies, because someone’s friend on one issue will often be their opponent on another.

Let me make it plain that we are not opposed to the concept of greening if it delivers greater public benefits from taxpayer expenditure. That is our clear position—the hon. Member for Bristol East made that point—and we want it to be achieved in a way that recognises the wide diversity of agriculture around the European Union. I just do not believe in the one-size-fits-all approach. It is hard to find such an approach even within the United Kingdom, as the hon. Member for Banff and Buchan said. Circumstances are different within England itself, with a hill farm in the Pennines being different from a cereal farm in East Anglia, and different parameters apply. I entirely agree with the EFRA Committee’s view that a one-size-fits-all approach might lose its relevance when applied to particular circumstances, and certainly when applied to our own.

Each of the areas proposed by the Commission initially, which were crop diversification, the retention of permanent pasture and the need for a proportion of land to be designated as ecological focus areas, has the capacity to divide opinion—informed opinion, because of exactly the points that Members have made today. Each measure contains the essence of a good idea—there is something there in the initial thinking—but the environmental benefits are not clear when the proposals are considered in the light of our own circumstances. I know that many other European Union member states are forming the same view, particularly when the supposed benefits are considered in the light of the costs and complexities of implementation. It is not obvious that the money should be spent in a way that more demonstrably delivers complexity rather than environmental benefit, which is crucial.

It is fair, and not unkind to Commissioner Ciolos, to say that a particularly remarkable aspect of the greening debate in Brussels is the fact that the Commission seems to have few, if any, supporters for the precise way forward that it has proposed. I would take some comfort from that if I saw a majority in favour of an alternative, but at the moment there are only many minorities.

Some countries have yet to be convinced about the basics, about the further shift towards paying farmers for delivering environmental public goods. They see ideals that we have long shared in this country as an expensive luxury at a time of economic difficulty, and we have to be alive to that view. There are attempts by some to water the proposals down and exempt the majority of their farmers. It is funny how definitions always exempt a member state’s own farmers from their effects—that is known as greenwashing. There are issues about greening by definition, and we do not want this to be a badge of convenience, with people carrying on exactly as before but with the application of greater funding, as that cannot be in anyone’s interest.

[Neil Parish]

The Minister makes an interesting point. There are cases in Europe of people wanting to exempt small farmers from a lot of the conditions. In countries where the majority of the land is made up of very small farms, all the greening aspects get taken out because the farmers are ruled out of them.

[Mr Heath]

Precisely so. Time and again people pay lip service to a “very good idea” but somehow it then does not apply to their own circumstances. We have to be wary of that and not fall into the same trap.

If we are to go down a route of some form of greening by definition—to which there is some advantage, in reducing complexity and allowing for easier systems—it has to be on the basis of something that shows the environmental benefit. I would argue, for instance, that our stewardship schemes do that. We could demonstrate beyond anyone’s reasonable doubt that our environmental schemes show a clear commitment to environmental benefits on the land within their compass. If we extend the self-definition too far, however, we get to the point at which simply having a hedge is sufficient qualification to be a greened farm. That is not an adequate definition.

Other member states share our view that this is basically the right direction for the CAP to be moving in, but that the Commission’s proposals are too blunt, too inflexible and too complex in their implementation. We have heard a few examples of that. The hon. Member for Banff and Buchan talked about the definition of “active farmer,” and my hon. Friend the Member for Tiverton and Honiton (Neil Parish) pointed out that quite a lot of Scotland is not farmed as intensively as most parts of England because of the nature of the ground. Yes, that is true, but the Scots have a case with, for instance, grazed heather, and we are helping to press that case strongly in the negotiations on behalf of the Scottish Government, with whom we have very close contacts, as we do with the other devolved Administrations.

With tenants, there is a question of who is the active farmer. It is far more important to identify the activity, rather than the status, of the person doing the farming. I hope we can move in that direction. I have already mentioned hill farming, and in the negotiations we have to be alive to the interests of less favoured areas. I said as much when I was in Cumbria recently and, not surprisingly, I received a measure of support, but we have to be conscious of the fact that there are many different types of farming, and we need to have something that, as far as possible, can accommodate those differences.

The hon. Member for Ogmore and others mentioned capping—I am sorry, but I cannot remember who provided the response. With the proposals on capping and young farmers, for instance, it is all too easy for lawyers simply to adjust the holding to fit the policy, rather than change what is happening. I am wary of that. I want to maintain the incentives, the competitiveness and all the rest. Although I can sometimes see the advantages of such proposals, I do not want the nominal ownership of an enterprise to be changed simply to create a money stream that would not otherwise be there, because that is not in the interests of efficient farming or the objectives that we have set.

[Huw Irranca-Davies]

I urge the Minister to keep his mind open, because the larger arable farmers would argue that they are already the most productive, that they invest the most in innovation and that they collaborate the most extensively. On that basis, they should be the most susceptible to an argument that, for the largest payments in the country, they should easily be able to prove that they are adding value, not purely on acreage or hectarage, but in the productivity and innovation of their farms. I urge him not to close his mind, because that is a sharp and intelligent argument for the good use of CAP payments.

[Mr Heath]

I never close my mind to anything. I am always open to a discussion, but the hon. Gentleman’s proposal is not that different—if, indeed, it is different at all—from something that the Commission proposed right at the start of the negotiations.

There are difficulties, but I am happy to have further discussions with the hon. Gentleman, because I never rule out proposals until I can see clearly that they are not in the wider interest. In return, I ask him to consider the potentially significant problems with artificially fragmenting landholdings or artificially transferring titles, which are not helpful things to encourage.

If there is a consensus among member states, it is that greening is too complex an issue on which to rush to agreement. I have already indicated that, in setting out the timetable, there are still wide differences in approach, and few support the proposals as they stand. It seems to me that there is still a lot of work to be done, and the negotiations need to continue. The one thing in the Select Committee’s report that I would take slight issue with is the implied criticism that Ministers and DEFRA have not been as active as we might be in Brussels on greening. I simply do not recognise that in the case of my right hon. Friends the Members for Meriden (Mrs Spelman) and for South East Cambridgeshire (Sir James Paice), who are the predecessors of the Secretary of State and me. They were very active in Brussels on CAP reform in general and on greening in particular. The Secretary of State and I are taking that forward and engaging at all levels. We are working with the Commission, the European Parliament and other member states.

My hon. Friend the Member for Thirsk and Malton enjoined me to cuddle up to MEPs. I do not know about cuddling up, but I do have conversations.

[Miss McIntosh]

Snuggle up.

[Mr Heath]

I do not know whether it is possible to snuggle up down a phone between Westminster and Edinburgh, but I did a bit of snuggling up yesterday to try to ensure that we are pressing our case effectively in the European Parliament.

[Mr Dai Havard (in the Chair)]

I am not sure where “snuggling” and “cuddling” fit in the lexicon of Hansard.

[Huw Irranca-Davies]

The Minister should put on record to whom he was snuggling up.

[Mr Heath]

An eminent member of the European Parliament’s agriculture and rural development committee, whom I hope can advance our cause. It is important that we keep in contact because of the co-decision process that has changed the way such things move forward. It is important that we understand what is being talked about in the European Parliament, what the positions that are being adopted look like and whether we can, at the earliest stage, influence the way that those positions develop and where coalitions form to ensure that, as far as possible, our interests are served not only in the Council but in the Parliament, because ultimately we need to persuade both of what we want. Greening is on the agenda for pretty much everything that we do in Brussels on CAP reform at both ministerial and official level.

We are also working with stakeholder organisations on greening, because it is important to hear what they have to say. My message today is that achieving the right outcome will not be easy, and I am not going to pretend that it is. There are so many viewpoints to accommodate across the EU, and there is always a risk that we may not fully agree with every element of a wide-ranging package of measures. I find it reassuring that there is no discernible fundamental difference between the Select Committee and the Government on greening, but in some ways it is even more reassuring that there is no discernible difference in attitude between all the Members who have spoken in this debate and the Government or between the parties. We are clear on what the British position needs to be; the question is whether we can persuade others to adopt a similar position.

I am coming to the end of my contribution, but I want to mention agri-science, which was raised by my hon. Friend the Member for Tiverton and Honiton. In a way, agri-science is only tangentially relevant, but in another way it is fundamental. If we are talking about food security and measures that could benefit the environment within a context of higher food production, we have to embrace the best technologies to make that happen. I do not say that lightly—sometimes we have to adopt clear precautionary principles when we embrace new technologies—but the agri-science consultation launched by my Department and the Department for Business, Innovation and Skills, which has responsibility for science and technology, is important. Finding ways to get the research community and higher education properly engaged in those areas will be crucial to finding solutions in the long run.

My hon. Friend mentioned blight-resistant potatoes. I went to a research laboratory a few weeks ago and spoke to the only man in Britain who was really pleased about potato blight. That is perhaps being unkind to him, but he was researching blight-resistant potatoes and told me, “Look, everyone’s got potato blight this year—and we haven’t! I have a crop that has been shown to be resistant to potato blight.” There are things that can be done. It is not just about genetic modification or novel foods; we need to be engaged with, and make progress on, a range of areas.

Not only do we owe it to people in this country to make sure that we persist with the sustainability of our agriculture, but we owe it to people in other countries who will be facing much bigger difficulties—something mentioned by the hon. Member for Glasgow North East (Mr Bain). There are people across the world who need to be fed, and they will find it more and more difficult as the effects of climate change are realised. We are in a unique position because of what we can achieve with the quality of our research and technology. Our skills will provide some of the solutions to the questions that will increasingly be asked. I want this country to be in that position, I want the European Union to be in that position, and I hope that it is axiomatic to what we are discussing.

This has been a fascinating and positive debate. I hope I have been able to cover most of the issues raised and to indicate where we stand. At the moment, this is an incomplete and difficult negotiation. I will not be able to be certain about the outcome until the point at which we have an agreement, first on the budget and then on the CAP. However, I assure hon. Members, and the Committee in particular, that the concerns they have expressed are very much at the heart of our negotiating position. Dealing with those concerns is precisely what we are attempting to do as Ministers engaged in those discussions.

[Mr Dai Havard (in the Chair)]

Thank you all for an intelligent and informed discussion. I wish the Minister the best of luck with his negotiations.

Question put and agreed to.