CAP Budget

Debate between Eilidh Whiteford and Iain McKenzie

Tuesday 26th November 2013 Westminster Hall

[Dr Eilidh Whiteford (Banff and Buchan) (SNP)]

It is a great pleasure to serve under your chairmanship this morning, Mr Caton. I am pleased to see at least a few other hon. Members taking an interest in recent developments on the common agricultural policy, and in particular the convergence uplift.

Common agricultural policy funding secures the vitality of farming in Scotland, and it is instrumental in the sustainable development of our rural economy. I represent one of the most rural constituencies anywhere in the UK, where farming underpins a healthy food production sector and a range of successful agricultural industries, and supports vibrant towns and villages. The investment we make in our farming sector through the CAP generates jobs, creates sustainable livelihoods and ensures effective land stewardship. Without it, our environment, economy and communities would be immeasurably poorer.

Earlier this year, agreement was reached on the future shape and direction of the CAP. There will be some substantial changes, but most significant for the purposes of today’s debate is the requirement for more equitable distribution of CAP funding, known as external convergence, across the EU. That has enormous significance for farmers in Scotland, because historically Scotland has had very low levels of support relative to the area of land in agricultural use. Scotland receives an average of €130 per hectare, compared with an EU average of €196 per hectare. In the UK, the English average is €265 per hectare, the Welsh average is €247 per hectare and the Northern Irish average is €335 per hectare. Compared with other parts of the EU and other parts of the UK, Scotland has been short-changed on the CAP for a long time, which has put our agricultural sector at a considerable competitive disadvantage. In that respect, moves towards convergence are an important step in the right direction.

Last week, when I questioned Ministers from the Department for Environment, Food and Rural Affairs on the matter, I received a response that was based on average farmer payments, which concerned me because it betrays either a worryingly poor understanding of what the convergence uplift is or a shameless attempt to pull the wool over our eyes. Average farmer payments are completely irrelevant to the calculation of the convergence uplift. I appreciate that the Minister is quite new to his role and might not yet fully understand the technicalities of how the convergence mechanism is calculated and what it is intended for. That is why it is so important to clarify that the convergence uplift has nothing whatever to do with individual farm size, which varies across Europe, depending on the landscape, climate and model of farming. The convergence uplift is calculated on the basis of average payments per hectare and nothing else. It is intended to benefit those whose support per hectare falls below 90% of the European average.

The convergence uplift is a mechanism introduced by the EU to ensure that member states with payment rates of less than 90% of the EU average rate per hectare receive an uplift designed to close the gap over the next six years. Although England, Wales and Northern Ireland are all above that threshold, Scotland is well below it —so far below, in fact, that it brings the UK average down. That is why the EU has awarded the UK a convergence uplift of €223 million. That is money designed to level the playing field, calculated on the basis of the average payment per hectare across Europe. It is money earmarked for Scottish agriculture.

[Mr Iain McKenzie (Inverclyde) (Lab)]

I congratulate the hon. Lady on securing this important debate. She has laid out a conclusive argument for Scotland getting its fair share of the money. Does she agree that it is essential for the Scottish and UK Governments to get together and deliver a coupling deal for the benefit of Scottish farmers?

[Dr Whiteford]

I agree entirely with the hon. Gentleman. There has been an unprecedented degree of co-operation in the Scottish Parliament on the matter. DEFRA has succeeded where many have failed in creating unity among the warring tribes in the Scottish Parliament.

There was a sense of disbelief in the Scottish farming community on 8 November when the UK Government announced that they had decided to split the convergence uplift four ways, rather than using it for its intended purpose. That disbelief has quickly turned to anger and a sense of betrayal. Last week’s Scottish Farmer called it an “act of grand larceny”. Last week, when I met with Scottish farming leaders—some of whom, I believe, are here today—we discussed what representations they might make to Ministers to look again at the issue and, at the very least, bring forward the promised review from 2017 to deliver progress towards convergence over the next six years. Yesterday, along with other Scottish MPs, I received a letter from the Secretary of State for Scotland, which appears to kick that possibility into the long grass by reiterating that no changes will be introduced until after 2020. I appeal to the Minister to look again at the need for convergence in the UK. Will he consider his review timetable and get round the table with stakeholders to work out how the convergence uplift can be used for its intended purpose?

[Dr Whiteford]

I know that the hon. Gentleman shares my concerns from a constituency perspective, because his constituency, like mine, is set to suffer some of the worst impacts of the Government’s approach. He makes an important point, and I hope the Government are listening.

The UK seems to be saying that it will simply ignore convergence until the next round of CAP negotiations. We are asking the Government to listen to the voices of the farming community and to work with stakeholders to ensure that convergence happens as the EU intended and that the convergence uplift comes to Scotland. The coalition parties have enjoyed an enviable degree of loyalty over the years from parts of the farming community, but that loyalty is not blind. Trust is a precious commodity in politics, and the Minister would be wise to listen to the farming community, even if he will not listen to the hon. Member for Argyll and Bute (Mr Reid) and me.

The issue has prompted a great degree of cross-party co-operation and collaboration at Holyrood. Will the Minister commit to meeting the cross-party representatives of the Scottish Parliament—the SNP, Labour, Tory and Liberal Democrat rural affairs spokespeople—who wrote to the UK Government recently requesting a meeting? As they pointed out:

“These receipts only exist because of Scotland’s current position. All other parts of the UK are above the threshold set by the EU for external convergence, and it is only because of Scotland’s extremely low average level of Pillar one payments per hectare that the UK as a whole fell below the threshold and qualified for an external convergence uplift.”

They made the important point that

“Passing on this uplift to Scotland will also not entail any deductions at all for farming colleagues in England, Wales or Northern Ireland.”

They went on to say:

“The European methodology focused entirely on per-hectare levels of payment, and the within-UK decision must be on the same basis.”

It is important that Members of this House understand how support for farmers in Scotland compares with support for farmers in other parts of Europe, so they can see that Scottish farmers are asking not for special treatment, but for parity of treatment with their neighbours and competitors. In Denmark, for example, the area eligible for pillar one funding is less than two thirds the size of Scotland’s eligible area, but Denmark receives more than one and a half times as much pillar one funding—€964 million, compared with Scotland’s €596.6 million. That means that Denmark’s per-hectare pillar one rate is almost three times the Scottish average pillar one rate. Denmark’s pillar two rate of €31 per hectare is more than two and a half times as high as Scotland’s rate of €11 per hectare. The Czech Republic also has a smaller eligible area than Scotland does, but the Czech Republic gets one and a half times as much money to fund pillar one. Its average pillar one rate per hectare is almost twice that of Scotland, and its pillar two rate is more than 10 times higher, at an average of €116 per hectare.

Even closer to home, our neighbours in the Republic of Ireland, who have a similar amount of eligible land under pillar one, get twice as much funding as we do, which means that the average Irish per-hectare pillar one rate is more than double the Scottish average, while its average per-hectare pillar two rates are more than 10 times the Scottish average. I could go on and list every single European Union member state, because each and every one of them, without exception, will receive a higher per-hectare rate than Scotland in both pillar one and pillar two by 2019. Let us be clear: if the average rate of payment in Scotland had been increased to €196 hectare, in line with the EU average and the objective of all member states by 2019, Scottish agriculture would have benefited to the tune of €1 billion over the next six years. Instead, as a peripheral region of a member state that places a low priority on the rural economy, Scotland’s per-hectare rate will drop to €128 by 2019 and could fall as low as €108 if all the eligible land comes into the system.

The same is true for pillar two. Although our rural development budget will rise by 7.8% in cash terms, in real terms that amounts to a 5.5% cut over six years. By contrast, 16 member states argued successfully for uplifts in their rural development funding. Ireland has secured nearly €2 billion, compared with Scotland’s £478 million. Finland has secured even more. With that kind of rural development funding, we could make transformational step changes to Scotland’s rural economy. We could create more jobs, help farms to diversify, improve amenities in our rural communities and strengthen environmental sustainability. Instead, Scotland will continue to have the lowest rural development allocation per hectare in the whole European Union.

Quite frankly, it is an insult to the intelligence of our farmers to pretend that the deal is anything other than profoundly lousy. For the Government to claim largesse, by suggesting that 2% additional flexibility on coupling in some way compensates for the failure to deliver adequate core funding, has been described to me as “quite pathetic”. As one farmer put it to me, “We’re supposed to be grateful to get the crumbs from a cake that should be ours by right.” Just to clarify, the 2% flexibility on coupling brings with it no extra money. It would merely allow us to divvy up the pot differently, to target more resources at the livestock sector, where they are most critical. The serious point is that an extra 2% coupling makes a negligible difference to beef farmers in Buchan, some of whom are set to take sizeable hits under the new regime. What they want and need is the option to go up to 13% coupling, like those member states that face similar challenges and that have successfully negotiated the ability to do so.

[Mr McKenzie]

I thank the hon. Lady for giving way again; she is being generous with her time. She sets out a compelling argument for the Minister to meet the cross-party group, which supports her position, from the Scottish Parliament as soon as possible. Would she say that he needs to give the date on which he will do so?

[Dr Whiteford]

I hope that an outcome of today’s debate will be not only meetings with the Scottish Parliament, but meaningful engagement with the National Farmers Union and other stakeholders. The farmers and crofters of Scotland desperately need a resolution. The sense of outrage is palpable in rural communities, going well beyond the farming communities that are the primary producers in the agricultural economy.

The convergence uplift has come to the UK only due to Scotland’s woeful position, languishing at the foot of the international table for pillar one and pillar two cash receipts. Scotland has the lowest levels of agricultural support in the European Union, yet the Secretary of State for Scotland believes he has delivered

“a fair, positive and stable package for all parts of the UK”.

He is demonstrating plainly that, far from being Scotland’s man in the Cabinet, he is the Tory’s spokesman in Scotland, defending an utterly indefensible decision. I will be interested to see whether the Minister can stand here today—an historic day in Scotland, when we consider our future and the future of our country—and repeat the Secretary of State’s claim with a straight face.

Under-Occupancy Penalty

Debate between Eilidh Whiteford and Iain McKenzie

Tuesday 5th November 2013 Westminster Hall

[Mr Iain McKenzie (Inverclyde) (Lab)]

It is a pleasure to serve under your chairmanship again, Mrs Riordan. I congratulate my hon. Friend the Member for South Shields (Mrs Lewell-Buck) on securing this important debate.

The stated aim of the under-occupancy penalty, to give it the Government’s preferred name, was to free up larger accommodation, and to cut the housing benefit bill by moving people into smaller properties. Well, the policy has not released larger accommodation; nor will it save the housing benefit it set out to save. Instead it will, as we have heard, drive people into the private rented sector and add to costs. Just where are local authorities and housing associations to find the smaller accommodation? The truth is that it could take years to place people in smaller homes, and that is assuming that no one’s circumstances change.

In Scotland, the UK Government’s changes to housing benefit have had a significant impact on claimants. The people affected by the changes are those with specially adapted homes to reflect their health conditions; separated parents, who potentially face losing access to their children; and tenants who are struggling to find alternative smaller accommodation, despite being willing to move.

All the under-occupancy charge has done in my constituency is bring people to the verge of crisis. Many are building up arrears, trying somehow to cope using discretionary housing payments, while others are desperately trying to find smaller accommodation. All that worry and panic is despite the best efforts of the housing associations and the council in Inverclyde. Advice agencies are also working together to reassure and help people. I recognise the assistance given by the Scottish Government to alleviate the cost of this penalty, although more could always be done.

The panic and fear instilled in our most vulnerable people is evidenced by Citizens Advice Scotland, which advised on almost 20,000 new housing benefit issues in 2012-13. That is about 75 per working day—an 11% increase on the previous year. However, there was a 40% increase in April 2013 compared with April 2012. Those increases can all be explained by the introduction of the new under-occupancy rules. In the first week after the start of the bedroom tax, 700 affected tenants approached Citizens Advice Scotland for advice. That is not to mention the numbers of worried, concerned and frightened people who visited my surgeries—and yes, I concede that many were exempt.

Another concern about the housing supply relates to adapted homes. If people who have adapted their homes to cater for their disability by installing step-in showers or wet rooms decide to move rather than incur the penalty, they will need to reinstall these adaptations in their new home, at significant cost. Surely it cannot be seen as an effective way of spending time and resources to move people out of homes that meet their needs into new homes that do not, and that must subsequently be adapted. It is a crazy situation, and the cost is getting out of control. It is short-sighted, and an unbelievable waste, as it costs the taxpayer more money, never mind the upheaval for the individuals concerned.

The vast majority of those affected in my constituency will be moving from two-bedroom to one-bedroom accommodation, if they can. That is being replicated throughout Scotland and the rest of the UK. Of the 105,000 households in Scotland affected by the under-occupancy penalty, an estimated 83,000 include an adult with a recognised disability. The proposed changes will therefore have a disproportionate impact on people with disabilities. Many of those tenants have severe health conditions and face reductions in income that could affect their health. Adapted housing will be affected. Estimates show that some 16,000 households have some form of aid or adaptation already in place. I acknowledge that the UK Government have increased the fund for discretionary housing payments, but the funding is still far below the level of payments that will be lost by claimants.

[Dr Eilidh Whiteford (Banff and Buchan) (SNP)]

The hon. Gentleman makes a powerful point about the eight out of 10 households in which a disabled person lives that are affected by the bedroom tax in Scotland. Does he accept that if people are to move to one-bedroom properties, those will almost certainly be in the private sector, where it will be even harder to get the kind of adaptations that disabled people often need in their homes?

[Mr McKenzie]

Absolutely. I fully accept that. I noted earlier in my speech that the changes are pushing people to find accommodation in the private sector, with all the additional costs involved.

Research by the National Housing Federation found that if the additional funding were to be distributed equally among every affected claimant of disability living allowance, they would each receive just £2.51 per week, compared with the average £11-a-week loss in housing benefit in Scotland. The pressure to find smaller homes and flats has become immense. In Inverclyde, there is a huge lack of one-bedroom accommodation. I ask the Minister: what are my constituents to do? Many will fall into arrears. Housing associations warned the Government from the start that the under-occupancy penalty would not work, and that families would face financial hardship and struggle to make ends meet.

Food Banks (Scotland)

Debate between Eilidh Whiteford and Iain McKenzie

Wednesday 19th December 2012 Westminster Hall

[Mr Iain McKenzie (Inverclyde) (Lab)]

It is a pleasure to serve under your chairmanship, Mr Betts. I, too, congratulate my hon. Friend the Member for Glenrothes (Lindsay Roy) on securing this important debate.

Put bluntly, food poverty across the UK is a national disgrace. The statistics are shocking and heart-rending. In Britain today, 13 million people live below the poverty line. In 2011-12, food banks fed more than 128,000 people nationwide—100% more than in the previous year. That has been driven by the rising cost of food and fuel, combined with static income, high unemployment and changes to benefits made by the Tory-led coalition Government. Those things are causing more and more people to go to food banks for help.

In Scotland, the number of families needing food banks has also risen by 100%, with nearly 3,000 people receiving food parcels since April this year. One charity alone has fed 6,000 people across Scotland. We now have a Dickensian situation, with many people in low-paid jobs, and people who rely on benefits, being forced to use food banks to feed their children and themselves regularly. The fact that 50% of those going to food banks are working is quite shocking, and it underlines the employment position across Scotland.

I want to focus on my constituency, where a new food bank opened less than three months ago for families falling below the poverty line. It is coming to the aid of local people who are struggling to find enough money to pay for food. It is working in partnership with the Elim church in the east end of Greenock. Those who know that area will know that it is not one of the most wealthy areas in my constituency, but it is certainly one of the most giving. I commend the church’s caring response to the hardship that is unfolding in and around its congregation.

I was delighted to assist members of the church with their fundraising the other week. I was also delighted to assist them outside supermarkets, asking for donations for those who are finding it difficult to feed themselves and their families. I have visited the church’s i58 food bank in Inverclyde, and for those not familiar with the Book of Isaiah and Isaiah 58, I should add that it deals with fasting and hunger. Staff at the food bank told me that more than 300 families had visited it in its first three months. They were worried because referrals to it had increased day by day, with more than 50 families visiting on just one day last week. Clearly, the situation is getting worse, as evidenced by the fact that demand is increasing so dramatically as we approach Christmas.

We have a Government in London who seemingly just do not care. Unfortunately, we have a Government in Edinburgh who are blind to everything except their obsession with the constitution. The ever-growing demand for food banks is a shocking sight in 21st-century Britain, and it shows what it truly means to live in Cameron’s Britain and Salmond’s Scotland at present. Neither Government has a credible plan to tackle the dreadful poverty that afflicts our nation.

The UK of the 21st century has people choosing between eating and heating, and for some there is no choice at all, because they can afford to do neither. There should be a national outcry, and tackling this issue should be at the heart of any Government’s programme. No child should go hungry in the UK, and no child, adult or pensioner should go hungry on Christmas day or any other day. Our Governments need to do more to eliminate the scandal of food banks.

[Dr Whiteford]

Will the hon. Gentleman give way?

[Mr McKenzie]

I have just finished.