Agriculture Bill (Tenth sitting)

Deidre Brock Excerpts

Committee Debate: 10th sitting: House of Commons
Tuesday 13th November 2018 Public Bill Committees

Producer and interbranch organisations etc: application for recognition

[Deidre Brock (Edinburgh North and Leith) (SNP)]

I beg to move amendment 56, in clause 22, page 16, line 30, leave out “to the Secretary of State”.

See explanatory statement for Amendment 59.

[The Chair]

With this it will be convenient to discuss the following:

Amendment 57, in clause 22, page 17, line 5, leave out “to the Secretary of State”.

Amendment 58, in clause 22, page 17, line 13, leave out “to the Secretary of State”.

Amendment 59, in clause 22, page 17, line 31, at end insert—

‘( ) An application under subsection (1), (3) or (5) is to be made to and determined by—

(a) the appropriate authority for the part of the United Kingdom in which the applicant has its registered office or principal place of business, or

(b) where the applicant is made up of producers, producer organisations or, as the case may be, businesses operating in more than one part of the United Kingdom, the appropriate authority for any of those parts.”

This amendment would require organisations of agricultural producers, associations of recognised producer organisations, and organisations of agricultural businesses to apply for recognition to the appropriate authority in the country of the UK where the applicant is principally based.

Amendment 60, in clause 22, page 17, line 38, leave out “The Secretary of State” and insert

“The appropriate authority to which an application is made under this section”.

Amendment 61, in clause 22, page 18, line 5, at end insert—

““appropriate authority” means—

(a) in relation to England, Wales or Northern Ireland, the Secretary of State,

(b) in relation to Scotland, the Scottish Ministers;”.

Amendment 62, in clause 23, page 18, line 30, leave out “the Secretary of State” and insert “an appropriate authority (within the meaning given in section 22(11))”.

This amendment would require the delegation of functions to require permission from the appropriate authority (as set out in amendment 61).

Amendment 63, in clause 24, page 18, line 37, leave out “the Secretary of State” and insert “an appropriate authority (within the meaning given in section 22(11))”.

This amendment would allow regulations to give the power to delegate functions to an appropriate authority (as set out in amendment 61)

Amendment 64, in clause 24, page 19, line 5, at end insert—

‘( ) Regulations under section 22 or 23 containing provision that extends to Scotland may be made only with the consent of the Scottish Ministers.”

This amendment would ensure that regulations under section 22 or 23 containing provision that extend to Scotland may be made only with the consent of Scottish Ministers.

New clause 5—Quality schemes for agricultural products and foodstuffs—

‘(1) Subsection (2) applies to any function of the Secretary of State under—

(a) Regulation (EU) No 1151/2012 of the European Parliament and of the Council of 21 November 2012 on quality schemes for agricultural products and foodstuffs (“the EU Regulation”),

(b) the delegated and implementing Regulations,

(c) any regulations made by the Secretary of State under the EU Regulation, and

(d) any regulations made under section 2(2) of the European Communities Act 1972 relating to the enforcement of the EU Regulation or the delegated and implementing Regulations.

(2) The Secretary of State may exercise the function only with the consent of the Scottish Ministers.

(3) In subsection (1), the “delegated and implementing Regulations” means—

(a) Commission Delegated Regulation (EU) No 664/2014 supplementing the EU Regulation with regard to the establishment of Union symbols for protected designations of origin, protected geographical indications and traditional specialities guaranteed and with regard to certain rules on sourcing, certain procedural rules and certain additional transitional rules,

(b) Commission Delegated Regulation (EU) No 665/2014 supplementing the EU Regulation with regard to conditions of use of the quality term “mountain product”, and

(c) Commission Implementing Regulation (EU) No 668/2014 laying down rules for the application of the EU Regulation.

(4) The references in subsection (1) to the EU Regulation and the delegated and implementing Regulations are to those instruments—

(a) as they have effect in domestic law by virtue of the European Union (Withdrawal) Act 2018, and

(b) as amended from time to time whether by virtue of that Act or otherwise.”

This clause relates to the replacement of current EU Geographical Indicators in future UK legislation. It requires that the exercise of relevant functions conferred on the Secretary of State in this area including in relation to its enforcement, should be subject to the consent of Scottish Ministers.

[Deidre Brock]

I still consider the lack of focus on food production a fundamental flaw of the Bill. It is a serious omission at a time when food security has become a major concern. Farmers already have a very clear interest in protecting the environment, and the sensible approach to supporting those endeavours would surely be along the lines of the work that the Soil Association is already doing in Scotland with the support of the Scottish Government: education and exampling to encourage more productive but environmentally friendly farming. I urge hon. Members to look at Future Farming Scotland, Farming with Nature and the Rural Innovation Support Service—three excellent programmes from the Soil Association to improve farming in Scotland that are far more effective than asking farmers to fill in more forms to show environmental progress.

It would be easier for larger enterprises to do that form-filling and comply with the rules for gaining that cash than it would be for small farms, and potentially easier for grouse moors and stalking estates to access funding than for small family-run farms producing foods for local markets. That offsets any possible benefits of so-called public goods. As food miles grow, the environmental benefits surely diminish, and, similarly, as the air miles and road miles of shooting enthusiasts grow, any environmental benefit from proper management of shooting estates and grouse moors vanishes, and perhaps even turns negative.

[Mr Goodwill]

I represent a very large moorland area on the north Yorkshire moors. Does the hon. Lady not agree that the management by keepers and shooting estates maintains the delicate environment for the benefit not only of the sheep and grouse that graze, but of the people who enjoy those areas?

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[Deidre Brock]

Management is certainly an important aspect, but as the air and road miles of shooting enthusiasts increase, so the environmental benefit of the proper management of shooting estates and grouse moors vanishes and can even turn negative.

I would argue that smaller enterprises providing produce for local consumption start from a more environmentally friendly base, and it makes sense to encourage them rather than larger interests. With respect to the Bill and agriculture in general, we in the Scottish National party see farms and land management as vital to rural communities, as well as being primary producers—that is especially true of crofters. The community cohesion function becomes even more important as communities become more remote. Hon. Members from across some areas of England and Wales will of course have examples to offer, but Scotland is a very different place, particularly when one heads into the Highlands, into the far north, or on to the islands, where farming is by no means an easy living and where there is a different culture and calendar to farming, and markedly different outcomes. Scotland is different and requires a different framework in which to operate.

I quote the evidence given by the National Farmers Union Scotland to the Scottish Affairs Committee recently. It said that

“significant elements of the Agriculture Bill are clearly about policy and policy delivery in England, and they would give us significant cause for concern if they were to be applied in Scotland. Quite simply, Scotland’s agricultural landscape is very different from that of England and much of the rest of the United Kingdom. That is why we must have agricultural policy delivered in a devolved capacity. There is clearly a trajectory within DEFRA England’s policy thinking that it wants to phase out direct support payments over a seven-year period and replace them with a public support for public goods approach, and that is clear within the Bill. Now, if you took that very distinct and very clear ‘first and fast’ approach in Scotland….that would be extremely detrimental, in many senses, to huge tracts of Scottish agriculture.”

[Simon Hoare]

The unique beauty of Scotland is clear for everybody to see and a precious resource within the United Kingdom, but I fail to understand how the hon. Lady can argue that that uniqueness means that Scotland needs bespoke policies and devolution, while, at the same time, her party wishes to adhere to the common agricultural policy and the common fisheries policy by remaining a part of the European Union, given that there is no opportunity for bespoke policies within the EU.

[Deidre Brock]

All four Administrations of the UK take very different approaches to CAP implementation, and there has been no impact on, say, the internal market as a result. I would have thought the hon. Member would be clear on the SNP’s policy regarding the CFP. It is not our proposal to continue with the CFP as it is. We have long called for its reform. That is on the record and has been the case for years. The damage to Scotland would be immense, because 85% of Scotland’s farmland is less favoured area land. Scotland needs a different framework from England.

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[Martin Whitfield]

Just for clarity, NFU Scotland has indicated it feels there is a lot of politicking going on between the Scottish Government and the Westminster Government over the Bill.

[Deidre Brock]

There are significant areas of dispute between the two Governments; it is not politicking. We are hearing from NFU Scotland that there are issues it would like to see pursued by both Governments—I am quite prepared to acknowledge that it is both Governments—and I will be raising some of those points later.

[Chris Davies (Brecon and Radnorshire) (Con)]

The hon. Lady’s description of Scotland could have been mistaken for a description of Wales—only Wales is a bit more beautiful perhaps. Is it not important for Scotland to align itself with Wales and support the Bill?

[Deidre Brock]

It has been said before that Wales has a different approach to the Bill. Of course, it is up to the Welsh Labour Government to choose to have a schedule inserted, but Wales voted to leave, and that puts a different spin on the Welsh Government’s approach.

[Colin Clark]

The hon. Lady is making a powerful speech, but she spoke about evidence from NFU Scotland, and its evidence is that it wants to see Scotland involved in the Bill. It says the engine is running and that it wants to get on board. In its position statement the other day, it said it would like to see Scotland involved in new clause 3, which we have already debated. Does she not agree that NFU Scotland has been absolutely clear that it would appreciate the Scottish Government either getting on board with the Bill or legislating in Holyrood? It has clearly said the engine is running on the Bill. Does she agree that the Scottish Government should get on board?

[Deidre Brock]

No, I do not in this instance. The hon. Gentleman is one of those who tried to table an amendment to schedule 3 last week. That demonstrates the vulnerability of inserting a schedule into the Bill. It would potentially allow a Member who is not even a member of the Government to alter something and control the Welsh Government’s ability to make payments to whoever they wish under that schedule. It is quite amusing, therefore, that he makes that contribution.

[Jenny Chapman]

I am trying to understand this. As I understand it, the Welsh Government put forward a schedule that one could call a power grab—they have helped themselves to some quite nice powers here—and the Government accepted it. I cannot see any attempt to amend the schedule getting anywhere, so I am not sure what lies behind the hon. Lady’s reluctance to submit a schedule.

[Deidre Brock]

We do not need a schedule inserted into the Bill. We do not need anyone to legislate for us on devolved matters. We have been producing our own legislation in such areas since 1999, when there was devolution to the Scottish Parliament. In terms of rushing into making legislation, I would have thought the hon. Lady would share my concerns about the views expressed by the Delegated Powers and Regulatory Reform Committee in the House of Lords on the Bill. It clearly demonstrates what happens when we rush into making legislation. The Scottish Government knows that it does not legally have to do it. They would much rather take their time, consult all the necessary organisations within the sector and arrive at stability and simplicity, which is of course the name of our document.

[Ben Lake (Ceredigion) (PC)]

My hon. Friend is making a very important point, which is perhaps best illustrated by the fact that the Welsh Government themselves have concerns about the schedule that they are trying to address, which they must do through this Committee, over which they have no direct control.

[Deidre Brock]

That is a perfect point and well illustrates my point, so I thank the hon. Gentleman for his remarks.

I have already commented, in my reference to the hon. Member for Brecon and Radnorshire, on the difficulties with thinking that a schedule to a Westminster Bill will protect devolved interests. The amendment I referred to came not from the Welsh Government or the UK Government, but from three Back-Bench MPs, so relying on a schedule for absolute protection is trusting to luck.

Although the Bill extends to Scotland in great part, it does little that would support Scottish agriculture. I will seek to amend and improve it where I can—much of it so far has been subject to the English votes for English laws process, meaning that I am unable to vote on it—but there is no amendment that will make it completely fit for purpose for Scotland. That will be a running issue in Scottish farming and for all the support mechanisms devolved to Holyrood. The flexibility of the EU support mechanisms gave some room for manoeuvre to allow support for Scotland’s farmers, but that is missing in the Bill, and I expect that Members representing parts of England are also a little concerned about that apparent rigidity. It will not come as any surprise that the Scottish National party would far rather all responsibility and power for managing Scottish agriculture rest in Scotland, but we are here and I will be looking to improve the Bill where I can. We will be back for the rest.

I turn to clause 22 and new clause 5 and amendments 56 to 64. The clause strays into devolved territory and could do with a bit of tidying up, just to save DEFRA Ministers having to deal with Scottish issues down the line, which would be tiresome for them. Amendments 56 to 64 would amend clause 22 to require that applications for recognition of producer organisations be made to the appropriate Administration. In other words, an organisation operating in Scotland would make its pitch to the Scottish Government, rather than leaving DEFRA to deal with it. That would save work for DEFRA officials and Ministers, but also has the virtue of respecting the devolution settlement.

[Simon Hoare]

This is a slightly philosophical point, which I think all members of the Committee, with the exception of the hon. Lady and the hon. Member for Ceredigion, will get. It would be a travesty to suggest that Ministers of the Crown or indeed this Westminster Parliament would find dealing with anything in Scotland tiresome or a nuisance. We are unionist parties that believe in the strength of the United Kingdom. The hon. Lady can make her point, but we will not be flippant with her nationalism, and she should not be flippant with our unionism.

[The Chair]

Order. That is a debating point; it has nothing to do with the amendment before us.

[Deidre Brock]

Thank you, Sir Roger.

Passing the amendments would kill two birds with one stone, relieving UK Ministers of a burden and going some way to show that the devolution settlement can be respected in legislation passed here, which I would argue is a fairly important point.

Under new clause 5, protected geographical indicators would continue to have the input of Scottish Ministers. There is currently no provision in the Bill for PGIs, but they are vital for Scottish goods. In the evidence sessions on the Bill and in evidence to the Scottish Affairs Committee, on which I sit, we have heard time and again about the importance of PGIs, for a whole rack of goods, including those from various parts of England and Wales, and I think—I would have to double-check—Northern Ireland. A while back, a Minister suggested that PGIs could be bargained away to get a trade deal, which is a real worry for producers and exporters. The proposed new clause would ensure that Scottish Ministers get a say in any new scheme for PGIs, in order to protect Scotland’s unique place in the market.

While I am in full flow, I will address the Government’s amendments. I have concerns about amendments 9 and 11, in that they seem to dilute the purpose of a producer organisation and invite disparate entities to form one. That might also encroach on devolved areas, and I ask the Minister not to press it for those reasons.

[Martin Whitfield]

On that point—before we leave the question of recognised producer organisations—the Government’s wording certainly seems loose. Does the hon. Lady envisage a producer organisation that could cross the boundaries of Scotland, England, Wales and Northern Ireland?

[Deidre Brock]

That is certainly possible, and my proposal would allow for that possibility. Amendment 10 is odd; it is not clear why there should be no legal form defined for an entity in legislation. I hope the Minister can clarify.

[Dr Drew]

I will be brief because it is important to hear from the Minister. This is one of the real issues with the Bill. We have no schedule for Scotland; we do have a schedule for Northern Ireland, and I visited there last week to get some clarity on what they think it implies for Northern Ireland’s participation in the Act. Officials were clear that they see the schedule as a political decision-making requirement. As there is no Government in Belfast at the moment, they feel it inappropriate to support the Bill as it stands. They feel strongly that the current direct payment system will remain in place—they want their £300 million, by the way, Minister.

The Bill is very interesting, but, effectively, it is a Bill only for England and Wales. It is not a Bill for Scotland or Northern Ireland, yet these things are under the aegis of a Bill for the United Kingdom. It is a funny Bill, with two parts of the United Kingdom not participating in it.

Now, it might be a case of the officials misunderstanding. Clearly, we could move to direct rule, and the Government would then have to take decisions. I thought I had better check with the Democratic Unionist party spokesperson on agriculture. He reaffirmed that the DUP does not support the movement towards an environmental approach and it will, in due course, vote against it. The DUP believes that direct payment should stay in place as the only way for farmers in Northern Ireland to be secure. Having also visited the Republic, I am not sure that it will move, even though the CAP is up for redesign at the moment. There are indications that it will move towards environmental payments, but it is not there yet.

The hon. Member for Edinburgh North and Leith’s point is interesting, to put it mildly. I am unclear where the Bill stands as a United Kingdom Bill. To me, it is very unclear. The devolution settlement means that, effectively, Scotland and Northern Ireland can do their own things, because agriculture is a devolved matter. If it were not a devolved matter, we would be discussing the agriculture policy of the United Kingdom. However, we cannot and we will not, and we might get a nasty shock when we come to final votes on the legislation.

There may be some interesting alliances, because I do not think we have understood the degree of the problem. I will make some more points on this when we reach schedule 4. I am laying down what I think is a very big dilemma. We have assumed that when this Bill becomes the Agriculture Act it will carry the four countries. I do not think it will. It will not carry Scotland, and it is increasingly evident that Northern Ireland will not be carried. I would welcome the Minister’s response to that. How does he intend to overcome that huge hurdle?

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[George Eustice]

That is broadly what would happen, and it is quite possible that the Scottish Government, Northern Ireland Administration and Welsh Government will already sometimes be involved in giving advice or supporting individuals who want to bring forward those designations. However, the assessment and designation of them has to be done by the UK.

I hope that, having been given this clear explanation as to why clauses 22 and 23 are reserved, the hon. Member for Edinburgh North and Leith will accept that there has perhaps been a misunderstanding about the difference between the ability to award grants and the process of recognition for the purposes of an exemption from competition law, which is reserved, and will withdraw her amendment.

[Deidre Brock]

I am sorry to disappoint the Minister but I will be calling for a vote. We believe part 6 and clauses 22 to 24 in particular require the Scottish Parliament’s consent as they are for a devolved purpose, namely the promotion of an effective agricultural market. The fact that in order to do this it is necessary to exempt producer organisations from the Competition Act 1998 regime does not mean that the provisions relate to competition law. Their purpose is not to regulate anti-competitive agreements, which is the precise element that is reserved. I am afraid we have to disagree with the Minister on that.

I understand that new clause 5 will be voted on later, but I want to tackle one thing. I did not realise that some of these things will be discussed when we look at new clause 34 later.

[The Chair]

Clause 34.

[Deidre Brock]

Sorry, clause 34. I will leave the hon. Member for Darlington to speak to that. The hon. Member for East Lothian attempted to suggest, perhaps inadvertently, that the Scottish Government is relaxed about what happens to farmers in Scotland later on. The Scottish Government were the first in the UK to come out with a consultation paper “Stability and Simplicity” to provide some certainty for their farmers. We are very clear that things can continue as they are after 29 March and there is no need for the schedule in the Bill that some have called for.

[Martin Whitfield]

That is not what I was suggesting. I was merely pointing out that NFU Scotland feels that both Governments are politicking on the Bill.

[Deidre Brock]

Perhaps I misunderstood his intention, so I appreciate his correction. Sir Roger, I feel that the amendments in my name stand or fall together. If I pressed amendment 56 to a vote as the lead amendment, is it right that the rest of the amendments would follow that?

[The Chair]

The system is fairly clear. We deal with the lead amendment, which is amendment 56. It is up to the hon. Lady, in discussion with the Chair, whether she moves any of the other amendments. I advise her that if amendment 56 falls, most of the others will fall. However, I noticed while she was speaking that the hon. Member for Darlington indicated an interest in amendment 59. I am unclear whether the hon. Member for Edinburgh North and Leith or anyone else wishes to move that amendment, but that is separate from the other sequence. Let us take the amendment that has been moved first, and perhaps the hon. Lady can have a quick think about what she would like to do after that. Does she wish to press amendment 56 to a vote?

[Deidre Brock]

Yes.

Question put, That the amendment be made.

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[Deidre Brock]

I wish to speak to amendments 65 and 66.

[The Chair]

Order. May I say to all Members that, if you wish to be called, it helps if you make it very clear by rising?

[Deidre Brock]

Thank you, Sir Roger.

I am minded to support the other Opposition amendments in this group, barring amendment 111, mainly because I am not entirely clear what its purpose is and I am a bit concerned that it could encroach on devolved responsibilities. Amendment 65 seeks only to ensure that the devolution settlement is respected. It would ensure that Scottish Ministers are able to exercise their powers under the devolution settlement. Agriculture is devolved, as the Secretary of State said in his most recent letter to the Scottish Government, and that should be respected.

Amendment 66 would ensure that those who are directly affected by the regulations are consulted. The Minister has made clear his liking for consultations and has said how much he values the input of those affected, so I am sure he will welcome the chance to put that into the Bill.

[George Eustice]

I shall begin by touching on amendment 48. Since the shadow Minister has not sought to remake an argument we have had many times, I will refrain from quoting from the Agriculture Act 1947 on this occasion.

I turn to the more substantive collection of amendments—93, 94 and 95—which seek to broaden the measure and to remove the requirement for it to apply to the first purchaser of agricultural produce. I understand the shadow Minister’s point, but I want to explain why we have adopted this approach. As he is aware, the Groceries Code Adjudicator enforces the groceries code for the 10 largest supermarkets—those with the largest turnover—and is funded by a levy on those retailers. It has been successful because it is focused on the key task of improving the relationship between the very sizeable retailers and their suppliers, which are often far smaller.

However, for a couple of years now people have raised concerns about the fact that some farmers do not directly supply the supermarkets. Indeed, although in sectors such as fruit and veg it is quite common for an individual farmer or grower to supply a supermarket, in other sectors—notably beef, lamb and dairy—farmers supply processors and abattoirs instead; they do not supply their produce directly to the supermarket. The point has been made that they do not benefit from the protection of the groceries code and the Groceries Code Adjudicator.

Anecdotally, there are sometimes problems with processors finding it easier to pass costs and breaches of the code on to the farmers than to have a difficult conversation with the retailer and tell it that it is in breach of the code, or to report it to the Groceries Code Adjudicator. For that reason, we said, “Let’s also address the problem at the other end of the scale.” The problem we are trying to address in the Agriculture Bill is that primary producers—farmers—are price takers and are often not sure what they will be paid until their animal has gone through the slaughter line. They can then end up with all sorts of costs that they did not expect and penalties that they could not have predicted. We therefore tried to address that unfairness by keeping the focus of these provisions on the first purchasers.

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[George Eustice]

I feel that this will be one of those unexpected issues that returns on Report. I will undertake in the meantime to talk to my ministerial colleagues responsible for the forestry industry.

Amendment 65 is a similar provision to that which we discussed in an earlier debate on producer organisations. It seeks to ensure that we could make measures in that area only with the consent of Scottish Ministers. We have adopted that approach because it is a competition matter that deals with the ability to have contractual changes linked directly to competition law—that is why it is a reserved matter. We are not doing anything new in that regard. The current Groceries Code Adjudicator is a UK-wide body; it operates UK-wide and the legislation that underpins it is UK-wide. The EU milk package is an example of a contractual fair-dealing provision under EU law. It applies UK-wide and can only be switched on and implemented on a UK basis. It is therefore a well-established fact that such issues, which pertain directly to competition law, are a reserved matter to be handled by the UK Government. That is why we do not accept that the provisions are necessary or acceptable.

[Deidre Brock]

I thank the Minister for his explanation but the Scottish Government do not agree with his interpretation of that; nor do I. We think that it requires the Scottish Parliament’s consent because it is for devolved purposes, namely the regulation of unfair contractual terms in commercial contracts by agricultural producers in Scotland. It does not relate to the competition law reservation, which is specifically directed at the regulation of anti-competitive agreements.

[George Eustice]

Although it might do so in a different way, it relates to competition law and is not an exemption from the chapter 1 requirements that we discussed earlier. The hon. Lady has not complained about the Groceries Code Adjudicator, which is administered on a UK basis and operates UK-wide; nor has she raised huge concerns about the way that the EU has always approached those matters, which is that they are a UK-wide competency and that switching on elements of the milk package is a UK decision and can be done only on a UK-wide basis. I hope that I have addressed the issues raised by the hon. Member for Edinburgh North and Leith about the role of Scotland in this reserved matter, and reassured the shadow Minister and the hon. Member for Bristol East that their amendments are unnecessary since they are provided for in part 2 of schedule 1.

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[The Chair]

We move on to amendment 86.

[Deidre Brock]

I wish to speak to amendments 65 and 66.

[The Chair]

We have finished that section. I am terribly sorry. The hon. Lady has to be on the ball.

[Deidre Brock]

Forgive me. I rose earlier, so I thought that I would be called.

[The Chair]

No. I am sorry. We have taken the vote on the lead amendment. Well, to be more exact, we have taken a vote on another amendment.

[Dr Drew]

We will revisit it. The hon. Lady need not worry.

[Deidre Brock]

Can we revisit it?

[The Chair]

You can.