Agriculture Bill

George Eustice Excerpts

2nd reading & 2nd reading: House of Commons & Money resolution: House of Commons & Programme motion: House of Commons & Money resolution & Programme motion
Monday 3rd February 2020 Commons Chamber

[The Minister of State, Department for Environment, Food and Rural Affairs (George Eustice)]

It is a real pleasure to close this debate. This is the second time that I have taken this Bill—or a similar version of it—through Parliament for Second Reading within the last two years, following the difficulties that the previous Parliament encountered. But we have now had a general election. We have a new Parliament and we have a newly elected Government who have a clear mandate to chart a different course for our country to become a genuinely independent sovereign country again and to make our own laws again.

The Bill means that, for the first time in half a century, we have the ability and the chance to create a new, independent agriculture policy. It is very encouraging to see so many hon. Members embrace that responsibility with so many thoughtful speeches today. It is particularly encouraging that so many chose to make their maiden speeches today in addressing this important Bill.

The hon. Member for Coatbridge, Chryston and Bellshill (Steven Bonnar) talked about the importance of his family, the support that he had there, and some of his less than favourable experiences at the hands of certain employers in the past. My hon. Friend the Member for Ynys Môn (Virginia Crosbie) gave a moving speech in which she referred to a family tragedy. I am sure we all recognise from that that she is going to be a champion for mental health issues. She will also clearly be a champion for the agricultural industry. I or, I am sure, a fellow Minister would be more than happy to attend the Anglesey show at some point.

[Sir John Hayes]

Will my hon. Friend give way?

[George Eustice]

I will not give way as I want to cover as many of the issues raised by hon. Members as possible.

My hon. Friend the new Member for Rushcliffe (Ruth Edwards) talked about the importance of high animal welfare and environmental standards, and the Bill provides for that. As she pointed out, her predecessor was a long-standing incumbent in this House. He was a big figure in politics—somebody who I did not always agree with, it has to be said, but nevertheless a highly experienced operator.

My hon. Friend the Member for Buckingham (Greg Smith) referred to some of the great opportunities contained in this Bill. I think he is right and I am sure that, if we get it wrong, his father-in-law will have something to say about it and my hon. Friend will have something to talk about around the dinner table. He finished with that fabulous quote from Margaret Thatcher about the importance of our farming communities.

My hon. Friend the Member for North Devon (Selaine Saxby) will, I know, be a champion for rural broadband. As a Cornishman, I have to take issue with her particular interpretation of the correct way to put cream and jam on a scone—it is of course jam first. I am pleased that the Prime Minister recently endorsed the Cornish interpretation of such matters during the election.

My hon. Friend the Member for South Cambridgeshire (Anthony Browne) highlighted some of the ridiculous rules that we have in the common agricultural policy, which is far too complex, with hundreds of pages of guidance. We now have an opportunity to do things very differently. Hope Farm in his constituency, run by the RSPB, is a fabulous example of some of the nature-sensitive farming that can be done, and we are keen to learn from projects such as that.

My hon. Friend the Member for West Dorset (Chris Loder) gave a fascinating account of how his grandmother, as a member of the Women’s Land Army, met his grandfather. It was a reminder of the great struggle that farmers and members of the WLA undertook to ensure that the nation was fed in the last war—something we must never forget. He talked about the importance of fairness in the supply chain and of provisions in the Bill to address that.

To turn to the points raised by the shadow Secretary of State, the emphasis of his speech was on the importance of food standards and making sure that we project British values on food standards in trade deals that we do. That was a clear commitment in our manifesto, as was dealt with by the Secretary of State earlier. The hon. Gentleman asked why a prohibition on the sale of chlorine-washed chicken or hormone-treated beef was not included in the Bill. The answer is that it is already on the statute book as retained EU law, so it already exists.

My hon. Friend the Member for Tiverton and Honiton (Neil Parish) asked whether the Bill’s conclusion had stalled as a result of some of the difficulties in the last Parliament. The answer to that is: most certainly not. The trials and pilots remain on course. Indeed, we already have more than 30 different trials in place across the country testing scheme. We will deploy a full pilot in 2021. Our progress in delivering the agricultural transition remains on course. He also mentioned the fact that food security is a global challenge and that we have a responsibility, in common with other temperate parts of the world, to ensure that we play our part to produce food for a growing world population. He is right, and clause 17(2)(a) provides for that, because the global availability of food is a consideration.

The hon. Member for Edinburgh North and Leith (Deidre Brock) raised the issue of currency fluctuations. She will know that, under the old regime, farmers had no certainty from one year to the next what they would be paid, since a euro volatility exchange rate was introduced to the system. We have now set that at the same level as it was in 2019, so Scotland has clarity about exactly how much funding it will receive in 2020 and 2021. That is more clarity and more certainty than it has ever had while a member of the European Union.

The hon. Member for Ceredigion (Ben Lake) talked about the importance of frameworks for the UK. I recently met members of the Farmers Union of Wales. We work closely with all our devolved counterparts, but I remind him that this is a devolved policy, and it is for each constituent part of the UK to design a policy that works for them.

My hon. Friend the Member for The Cotswolds (Sir Geoffrey Clifton-Brown) talked about the importance of food production and suggested that we have not reflected that in the revised Bill. I take issue with that, because clause 1(4) is explicit in saying that in designing any scheme under the clause, we must have regard for the need to encourage food production. That is a new addition to the Bill. He also talked about the lump sum payments that are provided for in the Bill. We know from all the work done in this area in the past that, if we want to help new entrants on to the land, we also have to help older farmers retire. That is why allowing farmers to retire with dignity and supporting them to do so is an important area to consider.

My hon. Friends the Members for Congleton (Fiona Bruce) and for York Outer (Julian Sturdy) suggested that we should have a more frequent review of food security than every five years. We have to see this requirement through the prism of clause 4, which envisages five-yearly multi-annual plans. It makes sense to align any review of food security with that provision. I would of course be happy to travel to Cheshire to meet the constituents of my hon. Friend the Member for Congleton.

The hon. Members for Bristol East (Kerry McCarthy) and for Nottingham East (Nadia Whittome) talked of the importance of agro-ecology. We are clear that whole-farm, holistic schemes can be provided for under clause 1. We are looking, for instance, at integrated pest management, catchment-sensitive farming and hedgerow schemes to encourage whole-farm approaches.

I turn to the hon. Member for North Antrim (Ian Paisley). I recognise that agriculture is a very important industry in Northern Ireland. This is a devolved policy. Both Northern Ireland and Wales have chosen to take schedules in the Bill that give them powers to continue the existing scheme but also modify and improve it.

The hon. Member for Angus (Dave Doogan) talked about seasonal workers. He has to recognise that we have increased the provision for seasonal workers from 2,500 to 10,000, largely due to the great campaigning work of his predecessor. Finally, my hon. Friend the Member for North Herefordshire (Bill Wiggin) gave a very upbeat, positive assessment of what we could do in future. That is what I want to conclude on. I grew up on a farm and spent 10 years in the industry. We have a chance now to design a modern policy that is fit for purpose in the 21st century. I therefore commend this Bill to the House.

Question put, That the amendment be made.

Agriculture Bill (First sitting)

George Eustice Excerpts

Committee stage & Committee Debate: 1st sitting: House of Commons
Tuesday 11th February 2020 Public Bill Committees

[The Chair]

Before we begin, I have a few preliminary points. Please switch off mobile phones. Tea and coffee is not allowed; that is not me being pompous—the Speaker does not allow tea or coffee in the Committee Rooms. Until that changes, Lent has come early and it is definitely water only.

We will first consider the programme motion on the amendment paper. We will then consider a motion to enable the reporting of written evidence for publication and then a motion to allow us to deliberate in private about our questions before the oral evidence session. In view of the limited time available, I hope we can take those matters without too much debate.

[The Minister of State, Department for Environment, Food and Rural Affairs (George Eustice)]

I beg to move,

That—

(1) the Committee shall (in addition to its first meeting at 9.25 am on Tuesday 11 February) meet—

(a) at 2.00 pm on Tuesday 11 February;

(b) at 11.30 am and 2.00 pm on Thursday 13 February;

(c) at 9.25 am and 2.00 pm on Tuesday 25 February;

(d) at 11.30 am and 2.00 pm on Thursday 27 February;

(e) at 9.25 am and 2.00 pm on Tuesday 3 March;

(f) at 11.30 am and 2.00 pm on Thursday 5 March;

(g) at 9.25 am and 2.00 pm on Tuesday 10 March;

(2) the Committee shall hear oral evidence in accordance with the following Table:

[The Chair]

Copies of written evidence that the Committee receives will be made available in the Committee Room. Colleagues can get papers on that table over there. The helpful Clerks will indicate where they are; if Members go around, behind me or the witnesses, they can pick up the papers.

Resolved,

That, at this and any subsequent meeting at which oral evidence is to be heard, the Committee shall sit in private until the witnesses are admitted.—(George Eustice.)

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[The Chair]

May I say to our witnesses, if you have never previously appeared before a Committee, that there is nothing at all to be worried about? My colleagues are very friendly. They are just trying to get information from you to use during the Committee stage of our proceedings. The session ends at 10.30 am, so it will go very quickly.

[George Eustice]

Q I want to start by asking what you consider to have been the main failures and limitations of the existing direct payment scheme, the common agricultural policy. Also, what are the main opportunities for your own particular interests, based on a new policy that rewards farmers for the delivery of public goods?

ffinlo Costain: One of the key challenges with the common agricultural policy is that it has largely rewarded farmers for owning land, and it has presided over an enormous disconnect between farmers, other people in the countryside, and customers, and often the supply chain as well. The huge advantage of the new legislation is that, in changing the funding system to public funds for public goods, we will be able to deliver the changes that we need—the farm animal welfare improvements, the sustainability improvements, the climate mitigation, and the biodiversity restoration, which has been so degraded under the common agricultural policy.

Make no bones about it: we are facing a climate and nature emergency that is upon us now, not tomorrow. It is critical that we get this right. For me, getting land use right is the golden ticket. Having the opportunity at this time to reform land use—so that we can continue producing good food and good nutrition, delivering national security in that way, which is critically important, as well as delivering climate mitigation, land adaption to help with climate change, and biodiversity restoration—is absolutely critical. The Bill comes at the perfect time, and it is well set up. There are some challenges within it, and some issues that I think we will address, but in general terms it is very positive.

Martin Lines: As a farm owner and a tenant, under the current system, with the single farm payment, I am encouraged to farm to the very edge of fields. Biodiversity and other bits of the landscape are not rewarded. As a tenant, my landlord takes away most if not all of my single farm payment on top of the rent. If we move to a public goods model, I actually get rewarded for the delivery of services as a land manager—as a farmer—so we would move into a system that better supports actual farmers, rather than the ownership and management of the landscape.

Caroline Drummond: One of the real challenges of the past system was the capability to drive ambition for farmers. It was a “Tell me what I’m doing” type of approach, so going forward, we have a real opportunity to demonstrate leadership, vision and ambition for our farming sector. Ensuring that we get the right governance is going to be really important. There needs to be partnership and development of trust between Governments, from voluntary approaches that are externally, independently verified such as farm assurance schemes, right through to building on some of the success stories of capability and innovation that we have seen among some of the farmers who are already thriving and doing very well in this country.

Jack Ward: The fresh produce industry has not benefited that greatly from the CAP. We are about 170,000 hectares; we have an output of about £2 billion from that area, and the contribution from the basic payment scheme is about £40 million. However, the contribution from the producer organisation scheme, which is broadly equivalent, has been incredibly important. I think we would like to see that continue in some shape or form.

In terms of opportunities, there is a terrific opportunity to increase the amount of fruit and veg that we currently produce. In some sectors, such as tomatoes, we are very dependent on imports. We import eight out of 10 tomatoes that we consume in the UK; we must be able to do better than that.

[Daniel Zeichner (Cambridge) (Lab)]

Q Good morning to you; it is very nice to see a farmer from Cambridgeshire here. The opening comments from the witnesses have been very positive and helpful, and I think we all welcome the notion of public money being spent on environmental gain. However, a number of us are concerned about the lack of detail in the Bill about environmental land management schemes. I think we had expected a policy paper from the Government, but I am not sure we have seen that yet. Do you share that concern?

ffinlo Costain: It is really important for Government to set a framework, but if there is a criticism of the way that Europe and the common agricultural policy have worked in the past, it is that it has been way too prescriptive. That has meant that, to a large extent, farmers have learned to do what they are told, rather than to properly understand and integrate what they are doing on their land.

My own view is that Government should become more goal-centred. They need to set the right metrics and to understand what outcomes they are trying to achieve, but then they need to take a step back and allow farmers to farm. Farmers understand their land, and if they have a funding model that supports environmental excellence and other public goods—restoration of soil health and so on—they can work out ways to do that. I would hate to see a situation where there is a continuing prescriptive approach, but it is focused on the environment rather than on how to produce cattle, and we end up with farmers still not really understanding what they are doing and simply farming the subsidy.

We need ownership of change, and farmers can do that. Farmers understand their land; they know their land, and if we give them the freedom to work within that public goods model, they will deliver the outcomes. They will step up. They are a standing army out there, ready to do this, and they will step up and do it.

Martin Lines: I have concerns about what the ELM for England would look like, the transition period, and how the funding is going to work. We need more detail about what the future will be, so that the farmers can start changing and adapting now to the model of what is coming. There is some concern, particularly about the transition period. As we go into the new system and payments under the current system tail off, what is going to bridge the lull in the middle, and how do we get farmers to step across to the new system at speed?

Caroline Drummond: I agree. There needs to be the policy documentation, so we can identify what this is going to look like and how the knitting all joins up—there are lots of balls of wool, but what are we trying to knit at the end of the day? Not much has been left out of the Bill, which is really key, but we need to know how it will be interpreted and how the ELMS projects will be carried out. There are a lot of them going on, and we need to know how they will be brought together to demonstrate the delivery against metrics, outcomes and, ultimately, impact. Ultimately, the Government have to deliver against the global and national targets around the sustainable development goals, the Paris agreement, and so on, but the farming sector has the opportunity to support us in demonstrating that we are helping on issues around climate change, biodiversity, soil improvement and those matters.

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[The Chair]

I know that at least one of you has given evidence to these sessions before—maybe two or three of you—but please enjoy the session, which runs until 11.25 am.

[George Eustice]

Q The Bill explicitly recognises animal health and welfare and native breeds as a public good. In recent years, we have seen a specialisation in arable in some parts of the country and a concentration of livestock in others. Some say that we need to get livestock back on the lowlands, so that we have more permanent pasture, more crop rotation, more organic matter in the soil and so on. I wonder whether those of you who feel able might comment on the benefits of livestock in our land management and in the farming system.

Christopher Price: I speak particularly on behalf of native breeds, rather than livestock generally, but I think that promoting our native breeds is hugely important. Dealing with economics first of all, you have pointed to the uplands as an area where it is harder to grow crops and where people therefore keep livestock, but that does not rule out having livestock elsewhere. If we have the right sort of livestock, grazed at the right density and in the right place, we are providing environmental benefits because we are creating the sorts of habitats we want. We are keeping down import costs—that helps the climate—which reduce farm incomes. There is a business and an environmental side to livestock, which are an important landscape feature as well. There is something exciting about seeing interesting animals wandering around our farms. It all helps towards tourism, and a sense of place and location. There are huge arguments to support increased livestock use.

John Cross: I speak as a mixed arable and livestock farmer, as opposed to my involvement with Livestock Information. There is absolutely no doubt that the combination of livestock on arable land has a profound effect. It is something that I would encourage the whole industry to look at, because as soon as you start to improve the organic matter levels, the vibrancy and the life within the soil, you realise the benefits that come with drought resistance and inherent fertility. In particular, if you involve a blend of, say, pigs and ruminants on arable land, you also have a profound effect on the birdlife that then decides to come to live on that farm. It is something that I believe in passionately, and it works, but certainly—as I heard referred to in the earlier session this morning—you have to be mindful of stocking densities. In particular, it is a matter of making good use of grazing legumes, which we are pioneering. It is a valuable mission that the Bill mentions, because we need more organic matter in arable land.

David Bowles: Just picking up on that point, I have been working on CAP issues for 20 years, and this is the first time that we have had the opportunity to get animal welfare into the new farm support system. We have only ever had one animal welfare scheme in the last 20 years, which was in Scotland, so it is really important that we start to get animal welfare payments into the system and, particularly on the stocking point, make sure that farmers are paid to go higher than the welfare standards they have at the moment. I think you will get win-win situations, with benefits to animal welfare, benefits to the environment, benefits to rare breeds, et cetera.

Thomas Lancaster: The RSPB is a big landowner and farmer—we have 30,000 livestock across our estate. In a lot of cases, those livestock are essential to the public goods that we deliver, particularly the high nature value farming systems that, again, have been a key feature of many CAP schemes in the past. We want to see future schemes in England supporting those high nature value farming systems. Extensive livestock production will be a key feature of those systems in future and is important in supporting species such as curlew and other breeding waders, or habitats such as upland hay meadows.

John’s point about densities is absolutely right, because overgrazing is a major problem for a lot of our designated sites and habitats. The opportunity we have in the Agriculture Bill, and with environmental land management schemes specifically, is to support farmers to find that optimum balance, which Martin Lines talked about a lot in the previous session and which can go hand in hand with a more profitable livestock farming system as well.

[George Eustice]

Q I have just a couple of further points. Mr Bowles, you are right, this is the first time that a country has put as much ambition into rewarding high animal welfare outcomes as we do in the Bill. Your organisation runs the RSPCA Assured scheme. What lessons can we learn from that about having a payment-for-public-goods model for farmers who go above and beyond the regulatory baseline? Also, if I may, a question for Mr Hall: in terms of livestock traceability, are there market opportunities for us in having that higher health and higher welfare supply chain, which can be demonstrated through the project that you are working on?

David Bowles: There are huge opportunities. We have only ever had one scheme in the UK, but we have had something like 52 schemes over the 28 EU member states. The RSPCA Assured scheme is very successful in certain areas, such as laying hens, where we probably have 55% of production, but it is very unsuccessful in other areas, such as sheep, beef, dairy and even chickens, which are all sectors where we have under 5% and in some areas under 1%. The market is therefore not delivering the higher welfare assurance schemes that we want in that particular market.

That is the exciting thing about the Bill, because it will provide the opportunity to give farmers a leg up through, for example, one-off capital grants, and then provide them with payments to ensure that, where the market does not deliver, they can deliver those higher welfare schemes. The RSPCA is very happy that the Bill provides for that two-step process. We think there are very exciting times here for farmers, particularly in those areas where we have not traditionally gone into higher welfare schemes. For instance, at the moment, 0% of ducks in the UK have access to full-body water. The expression “taking a duck to water” does not exist for UK duck farming. That is a tragedy, not just for ducks, but for UK farming.

Simon Hall: There are undoubtedly opportunities in the marketplace if we can evidence welfare standards, provenance, and so on. The Livestock Information programme will put in place a new multi-species traceability service that brings together data based on animals, keepership—the people who have been responsible for the animal throughout its life—and location, the farm where it is based. The whole proposition of the programme that we are delivering is about using that data not only to better inform Government responses to animal disease control and ensuring food safety, but to enable the industry to take advantage of that data to evidence its standards and demonstrate to its consumers, domestically or internationally, the standards to that livestock is produced, the provenance of the animals and so on in real data. Working in partnership with Government and industry, there is an opportunity to set out our stall in a world-leading manner.

Christopher Price: To build on what has been said, an important aspect of the Livestock Information service—if it goes as far as I hope it does—is that it will give greater recognition to individual breeds. It will make it clear that what you are buying is a saddleback or whatever. At the moment, it is very difficult for the consumer to know that what he or she is buying is what the butcher or supermarket purports it to be, or to know when they use nebulous language to imply that it has a particular provenance. If we can get to a system whereby people are promoting particular breeds associated with a particular area, we will do well to create a much stronger sense of place and local identity, which will help with creating new markets.

[Daniel Zeichner]

Q I think at least three of the witnesses are part of organisations that were signatories to the letter to the Prime Minister at the end of last month warning about the potential risks of lower standards for imported food. Will those three witnesses, and perhaps others, comment briefly on what you think will be the effect of allowing imports of food produced to lower environmental welfare and health standards on consumers, producers and the environment?

David Bowles: For the RSPCA, this is probably the biggest omission in the Bill. The Government have resisted putting anything in the Bill that says that we will not import produce or food to lower standards than those of the UK. I cannot see why they have resisted that. The Secretary of State said, “Trust me, because it’s in the manifesto.” Frankly, I do not think that is good enough. Last year the Government tabled their own amendment to the Trade Bill that said exactly that. I hope they do the same here, because if they do not, they will leave British farmers who are producing to those higher welfare standards open to US imports.

For instance, 55% of the pork meat and bacon that we eat is imported. Virtually all that comes from the EU. If you start importing that from the USA, where they still have sow stalls, where they still give their pigs ractopamine, which is an illegal drug in UK pig farming, you are opening up to cheaper imports coming in, particularly if you do not have consumer information and labelling. I am pleased that labelling is in the Agriculture Bill, but this needs to be part of a matrix. You need to have the same standards for food coming in. The RSPCA is not afraid of higher welfare food coming in. What we are afraid of is food coming in that is illegal to produce in the UK.

Christopher Price: I agree with everything that has been said, but I think we need to be careful about putting too much trust in labelling. I cannot see that people are going to make many purchasing decisions on the basis of labelling. Something like less than 5% of decisions nowadays are based on labelling, which includes all the various organic and assurance schemes. This has to be dealt with by legislation and regulation. You cannot leave it to consumer good will in the supermarket.

Thomas Lancaster: I agree with all that. We worked very closely with the NFU to co-ordinate that letter. We view assurance around import standards as a foundational element of the whole future farming policy and as really important to farmers’ ability to invest in public goods schemes with confidence.

The letter not only touched on a defensive ask, but pushed a more aspirational agenda around a role for the UK to set out a world-leading trade policy that takes account of societal demands such as climate change, biodiversity and all those sorts of issues, which are not reflected in modern international trade policy, and certainly not at the World Trade Organisation.

This is often reported as: “We want protection.” Actually, as David said, we want to be able to compete on common standards. No UK farmers are calling for protectionism for its own sake, but there is an opportunity to call for a more sustainable trade policy that has a bit more imagination regarding how we can fight the climate and environment emergency, while embarking upon a new international trade policy, as we now will.

John Cross: It has been very well addressed already, but briefly, if society is sincere about animal welfare and is aspirational—which it should be—then it should not look for one set of standards domestically and, to a certain extent, export its conscience and accept lower standards from elsewhere. You should be consistent in your attitude to animals.

Agriculture Bill (Second sitting)

George Eustice Excerpts

Committee stage & Committee Debate: 2nd sitting: House of Commons
Tuesday 11th February 2020 Public Bill Committees

[The Chair]

The acoustics in this room are appalling, which is nobody’s fault apart from the architect’s. If witnesses and members of the Committee could speak up, we would all be grateful. Thank you.

[The Minister of State, Department for Environment, Food and Rural Affairs (George Eustice)]

Q39 Schedule 6 to the Bill has Northern Ireland-specific provisions, principally an ability and power to modify the legacy basic payment scheme—the common agricultural policy scheme. Will you explain what your priorities are to simplify and improve the legacy scheme? Secondly, do you have any emerging thoughts about future policy that you might make through your own Northern Ireland legislation?

Norman Fulton: Our motivation in drafting the schedule was to retain options for incoming Ministers—obviously this was done in the absence of an Executive—so we developed it to be able to preserve the ability to continue to make payments to farmers under pillar 1 and to enable us both to continue to deliver schemes under pillar 2, until such a time as Ministers wish to change those measures, and to keep pace with appropriate changes elsewhere in the UK. So it was really to provide that framework for incoming Ministers but not really to set out any particular direction in policy, which is clearly something that Ministers will need to take a lead on. There is some scope for simplification in the powers we propose, but it is really for Ministers to decide which of those powers they might want to move forward on.

In terms of the future direction of policy, we engaged with our major stakeholders from the farming, food and environmental sides, and we produced a draft outline framework for agriculture, which we published for consultation in August 2018, really around the four pillars of resilience, environmental sustainability, productivity and supply chain functionality. It is a very high-level document and it received a good response from our stakeholders. Now that we have a Minister and an Executive in place, we need to work to flesh that out and to start to chart a way forward in the longer term.

Ivor Ferguson: From the farmers’ point of view, we had negotiations with our farmers and discussions on how we would like to see payments going forward. We produced a discussion document. We felt that we were quite happy for farmers to be rewarded for activity, whether that be agricultural production or environmental activity. We were quite happy with that because a large number of farmers were not fully happy with area-based payments, in that they felt that the landlord or people who owned vast areas of land received most of the benefit. Our farmers will be quite happy to have money directed to people who are engaged in activity, be it production or environmental.

Having said that, we would not want to see area-based payments disappear completely. We would like to keep that in the form of a resilience or volatility payment, bearing in mind that we have a land border with the Republic of Ireland where they will still receive land-based payments. We could not be disadvantaged in any way with our farming colleagues in southern Ireland.

From that point of view, we would like to see some form of a resilience or volatility payment. If we look at the recent farm income figures for Northern Ireland, the profitability figure has fallen from well over £300 million down to £290 million. That is a similar figure to what comes in in farm support to Northern Ireland. It is a stark reminder of how dependent some sectors are on basic payments.

[George Eustice]

Q You mentioned that the rationale for an area payment might be resilience or as a risk-management tool, but it is ultimately a subsidy on land tenure or land ownership, so is it the best tool to deal with those issues? Or is it a straightforward market intervention—crisis payments when there is a slump in the market or a severe weather event, when you could intervene using the other crisis powers that are in the other part of the schedule?

Ivor Ferguson: If there were vast changes in the market for whatever reason, we would certainly need more support. This resilience payment would be much less than the payment today—perhaps 30%, 40% or at the most 50%. We have not put a figure on that yet; it is something we would have to discuss with our farmers fairly quickly now.

[Daniel Zeichner (Cambridge) (Lab)]

Q Good afternoon, Mr Stringer. In the written evidence supplied, Mr Fulton, you raise a number of issues around divergence, both now and in future. Could you say a bit more about those issues? Could Mr Ferguson also comment on divergence?

Norman Fulton: This is certainly an issue of concern to us. We have to be mindful of the fact that we now have the Ireland/Northern Ireland protocol under the withdrawal agreement, which means we will need to align with the European systems, whereas those in the rest of the UK could diverge. Therefore, we would be concerned that, within what will be the single UK market, there could be different approaches to marketing standards, for example. Obviously, that is something that we will all need to be mindful of. I suppose it will be managed through common frameworks across the UK. A lot of work needs to go into thinking through how we will operate across the UK, to ensure that the UK market is not distorted in any way and there is a level playing field for all players in that market.

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[The Chair]

We will now hear evidence from the NFU and the National Federation of Young Farmers’ Clubs. For this session, we have until 3 pm. Would you please introduce yourselves?

Nick von Westenholz: Nick von Westenholz, director of EU exit and international trade at the National Farmers Union.

David Goodwin: David Goodwin, chair of agriculture and rural issues for the National Federation of Young Farmers’ Clubs, and I farm in south Northamptonshire.

[George Eustice]

Q You will be aware that clause 9 has quite a broad power giving the Government the ability to start simplifying and sorting out some of the complexity of the legacy CAP scheme, which we can deploy from as early as next year. What would be your priorities to improve the legacy scheme in the time until the new one is rolled out?

Nick von Westenholz: First and foremost, the content or focus of those simplifications is not as important as giving information to farmers. During the previous Parliament, as the previous Bill was going through, there was increasing anxiety that, while simplification may or may not be coming down the line this year, farmers would not be informed about what those simplifications were, and therefore would be unable to properly prepare in order to meet the requirements of whatever the scheme is. First and foremost, farmers need early guidance about the requirements of the scheme they will be subject to, well in advance of that scheme year beginning. That information is almost as important as what the simplifications might be.

In terms of what the simplifications are, we are engaging with officials at the Department for Environment, Food and Rural Affairs, as you will know. It will not surprise you that some of the current requirements, such as the three-crop rule, have been criticised by many farmers as overly bureaucratic without really achieving the greening aims it may have hoped to address; that one comes up most often in our conversation with members.

David Goodwin: All our members are keen to get on and farm. That is what we are hearing a lot of at the moment. They hope that this Bill will enable them to do that, to look for opportunities and to expand their businesses. We keep talking about simplification; anything we can simplify will be a good thing. There is a real worry that we will not meet environmental and welfare aims. We need to ensure we maintain our high standards and do not let them slip.

[George Eustice]

Q In terms of helping new entrants and the next generation of younger farmers, what is most important for your members? Is it access to land at an affordable rent, or is it having an area-based subsidy system as we do now?

David Goodwin: Access to land is obviously a key concern for our members, but access to land is good only as long as the land they are looking to farm is profitable and viable. Finding ways to enable that is also important. From that point of view, a subsidy system of some description, where farmers are rewarded for the good work they are doing, is still quite high on our agenda.

[George Eustice]

Q Has the NFU done any work on what a sustainable land rent is for different land types without the land tenure subsidy that we have through direct payments?

Nick von Westenholz: I am not aware that we have looked at that sort of detail on where land rents might sit. It is an interesting question and one we probably ought to look at.

[Daniel Zeichner]

Q Good afternoon. It is probably no surprise to you that my opening question will refer to the letter to the Prime Minister that the NFU and over 60 other organisations have written, expressing concern about the potential risks caused by imported food produced to lower environmental animal welfare or food quality standards. What needs to be done to this Bill to resolve that problem?

Nick von Westenholz: The obvious omission from the Bill, in our view, is anything around import standards. It is absolutely right that that should be in the Bill, because if the Government are trying to promote, which we would support, more sustainable production and food systems domestically in the future, which is the core aim of the Bill—to provide a support framework for farming in a high welfare, environmentally sustainable way—they will be fundamentally undermined in that objective if there is not a concurrent trade policy that prevents farm businesses from being undercut by substandard imports. A two-pronged approach in policy terms—trade policy and domestic policy—is needed to prevent undermining that sort of farming, in which UK farmers excel.

The detail of how the Bill is amended or of the terms of the legislation that can achieve that may be quite complicated and something that the Committee needs to consider as it goes through the Bill line by line, but at the core there must be a requirement that if the UK is going to import food, that imported food meets the same standards of environmental protection, animal welfare and food safety as UK producers are required to meet. Of course, the Government have been very reassuring on that point in recent weeks and have given some guarantees in that regard, but we feel that that needs to be underpinned by legislation, because there are real technical challenges in doing this that any Government, whether this Government or a future Government, are going to come up against as they negotiate trade deals and as they pursue a new role for us as an independent member of the WTO.

--- Later in debate ---

[Abena Oppong-Asare]

Q My question links in with Ms Crosbie’s question and is directed to Mr Goodwin. As you know, the ageing population of farmers is changing. Is there anything specific in the Bill that you think needs to be changed that could help more young individuals to go into farming? Is there something that you feel needs to be specifically looked into?

David Goodwin: As we have touched on at various points in this session, the crux of the matter is this Bill’s enabling farmers to run effective, efficient and sustainable businesses, both environmentally and economically. From a young farmer’s point of view, the foundation of all this must be a strong, stable agricultural industry. The only way to attract young people into agriculture is to offer them opportunity; it is difficult to sell the idea of working 150 hours a week and being paid less than the minimum wage to people who are not necessarily in love with agriculture. There are no specifics that spring to mind, but anything we can do to support agriculture is a positive.

[George Eustice]

Q I want to turn to a different part of the Bill, chapter 2, and the provisions on fair dealing and transparency in the supply chain. Can you tell us which sectors suffer the most from a lack of transparency and fairness in the supply chain? Which are most likely to be price takers? What regulations or steps would you like the Government to take, under the powers in this Bill, to ensure that farmers are in a fairer position relative to others in the supply chain?

David Goodwin: I have a very quick point on that, specifically pertaining to the lamb industry. We have had quite a lot of feedback from our members about lack of transparency: under the sheep legislation as it is at the moment, we are forced to electronically tag and identify all the sheep, but currently the abattoirs and processors are not required to pass that information back down the chain or identify those carcases as pertaining to those animals. There is a perceived transparency issue with some processes. It is not that potentially we are not being paid the right amounts, but I think people would like to know what our killing out percentages are, so that we can improve performance and make better informed decisions.

Nick von Westenholz: We are working through our commodity boards, which is the way we cover the different steps in the NFU to address exactly how the powers will be used. We are pleased that those powers are in the Bill, but lots of them rely on secondary legislation to operate, so it seems that potentially there is still quite a job to do once the Bill is enacted to ensure that the powers can be used properly to do what they are supposed to do. We look forward to working with officials to work out exactly how those powers can be deployed once the Bill is enacted—that is a feature of the enabling aspect of the Bill. We certainly think the focus on improving the supply chain is a critical bit of the Bill.

[Daniel Zeichner]

Q Let us turn to the delinking proposals for a moment. There does not seem to be a great deal of detail in there. The intention is to bring in new people, which we would support, but are there dangers of unintended consequences? Would you like to see more detail?

Nick von Westenholz: Yes, absolutely. We would like more detail. We understand there was an intention to consult on them at some point under the last Bill, so presumably that will still happen. You are absolutely right that there are potential unintended consequences, not least because those aspects of the Bill relate to England, and there could be a very different way forward in other parts of the UK. That would potentially lead to a very different looking system between England and other parts of the UK. We need to understand the details. Some people might be attracted to the implications of delinking, superficially. Once you delink—particularly with the potential to move to lump sum payments, which is one of the reasons for doing so—you are moving away from some of the things I spoke about earlier, such as being able to manage the transition for the next few years, particularly in the volatile circumstances that might arise for farming. So yes, the long-winded answer is that we would like more detail.

David Goodwin: We tend to agree on the whole. There is a feeling of quiet optimism that it might offer opportunities for young people to come into agriculture. Without some detail to see exactly how that might work and whether it is feasible, people are keeping it at arm’s length.

--- Later in debate ---

[The Chair]

We will now hear oral evidence from Co-operatives UK, and we have until 3.30 pm. Welcome. Would you like to introduce yourself?

Richard Self: I am Richard Self, agriculture manager with Co-operatives UK, supporting our farmer co-operatives up and down the country.

[George Eustice]

Q Are you broadly content with the powers in the Bill to modify the retained EU law on producer organisations in particular? Do you support the principle of moving away from the area-based subsidy payment we have now to a system of payment for public goods?

Richard Self: We are broadly happy with the way the Bill is set out. The detail will come in secondary legislation for the areas of co-operation and collaboration that we are interested in. The main concern is around exemptions. The exemptions are currently very supportive of co-operatives, but there is some room in the Bill for that to be narrowed, and we need to ensure that the current exemptions are carried through to this new environment. We want to encourage our co-operatives, not discourage them.

On subsidy payments, we accept that. It will create a new environment and a new world for farmers to operate in. Again, co-operation and collaboration can help farmers become productive and efficient within that new world.

[George Eustice]

Q Coming back to exemptions, I think most are carried forward by the Bill. Specifically on dairy contracts, for example, co-operatives were excluded from the voluntary dairy code, but if we were to introduce a mandatory code under provisions in the Bill, they might not be. Will you explain why co-operatives are a special case that should be exempt from giving farmers clarity about how the milk price is calculated?

Richard Self: It is an interesting area. I am not an expert on the dairy sector, but in milk co-operatives the first-stage processor is owned by the farmers. If that processor takes a high price, farmers will get that back at some stage; in another situation where they do not own the processor, they will not. Therefore, it inhibits them from reacting to the market, because ultimately in a situation where the farmer owns the processor, the benefits will eventually come back to the farmer because they own the business.

[Daniel Zeichner]

Q In general, will the Bill help producer organisations? What more could be done? Why have we not traditionally done better in UK agriculture?

Richard Self: Producer organisations have done a good job, but I think some people would say they could do a better job if they were better organised. I think we could have made better use of them in the past—other countries have made very good use of their POs. One concern we have around POs is that they might be too narrow. We want to ensure that all types of co-operative have the chance to be a PO, and that extra hoops and barriers are not put in the way of existing co-operatives, making it more difficult for them to get to that PO status.

--- Later in debate ---

[Danny Kruger]

Q You have pretty much answered my question. Perhaps you could elaborate a bit more on how to do that. If it is a question of larger farmers naturally combining because they are more professional, as you imply, is it just a question of education and making clear the opportunities that are there? Information, not education, sorry—that was patronising.

Richard Self: No; that was a good point. Education is good point. I looked at this last year. I looked at our universities and colleges, and they do not do anything on the co-operative business model and how it works round the world, and how farmers benefit from getting engaged. Last year, the Royal Agricultural University did some work for us. It highlighted the lack of understanding of how the business model works and brings benefit back to the farmers—it is about adding and capturing that value and bringing it back. Some farmers have said to me, “Is there any point in us adding value, because someone else captures it?”, whereas a co-operative makes sure that that value is brought back.

We need to educate—“inform” might be a better word in some ways. We do proper case studies and show how, around the world, co-operatives are used in such an effective way, and how their use continues to be developed as they go forward. We were doing quite a lot of work after the Curry Commission report. I was involved in Share to Grow initiatives to get production collaboration going, and we were making some good ground, but then 2008 happened and the cash—the support—stopped. Since then, progress has basically stopped. We have probably moved backwards, if anything, since then in terms of the level of collaboration and co-operation. External support is required to make this happen; it will not happen without that external support to carry it through.

[George Eustice]

Q One of the criticisms of the fruit-and-veg PO regime in particular was that, apart from being very litigious because of the way in which the legislation was drafted, support could only be given to predominantly marketing co-operatives—marketing had to be their primary function. Some groups such as the British Growers Association and others have said that that is wrong. Would you support an approach with support for co-operatives to come together to do research and development, or as buyer groups, but not necessarily marketing in the traditional sense?

Richard Self: Obviously, marketing and consolidating products to make efficiencies in the supply chain are really important, but as we move forward, there are lots of other opportunities for co-operatives to get involved and for farmers to work together. Data is one—we talk about “big data”—and co-operatives are in an excellent position to harvest that data and to use it, not just for their benefit, but for the benefit of the whole supply chain. It will be important, going forward, that we have really efficient supply chains, so that we compete with external supply chains. Working with a co-operative at the centre of that, at the production level, is important both upstream and downstream. If we can have PO schemes that run across different areas and different sections of that supply chain, it would be good.

[George Eustice]

Q On the competition law side, what kind of exemptions or special provisions in law would you seek to enable the co-operative model to develop?

Richard Self: I think that the existing competition law that we enjoy now—or did, under EU law—would be good to carry through. That is how I understand it, although I am not an expert in this area. The worry is that it might be narrower in the future, so that the onus comes to fall on the co-operative to show that it is not competing unfairly, whereas at the moment it can say, “We’re a co-operative,” and then someone else has to prove that it is competing unfairly. The problem with that is that co-operatives would have more risk and more uncertainty when they were trying to grow a particular business and so on. That is why we would like to keep it as it is at the moment.

[George Eustice]

Q Are you content with the—I think—30% market share provision? So no co-operative is allowed to go above that—certainly with dairy.

Richard Self: I think that would be sensible. It would be a good aspiration for some areas.

[Ruth Jones]

Q Mr Self, in the agri-food supply chain, how well does the Bill move the power base away from the major retailers towards the farmer?

Richard Self: I am probably not qualified to say how well the Bill does in that sense, but I believe that if we can have a policy with an almost horizontal theme of collaboration and co-operation that runs through the environmental or production side of it, or anything else, it would be good to improve that. In particular, that strengthens up the position of the primary producer working in a co-operative, in terms of balancing out.

Some processors and suppliers are worried about this, if farmers get together. In some situations, they have—how should we say?—been proactively discouraging it, and we need to avoid that happening. It is to the benefit of the whole supply chain if it works with that co-operative—they can get economies of scale, help manage supply and demand, and use the branding of the co-operative, if you like, to get to the end consumer to show the traceability, the welfare and the quality of the product when working with a co-operative. There are win-win situations for both co-operatives and businesses up and down the supply chain if it is looked at the right way. They can see it as a threat to their profitability.

--- Later in debate ---

[Theo Clarke]

Q How do we ensure that the existing groceries supply code of practice is consistent, so that we have fair dealing across the whole supply chain?

Richard Self: I probably do not know enough about that. The code does a good job in helping the process. Co-operatives are my area of expertise. It would be good if that included co-operation and collaboration as it would help redress some of the balance of fairness within the supply chain, but would be for the benefit of the whole supply chain if handled the right way.

[George Eustice]

Q I wanted to return to the issue of dairy contracts, and whether there should be a continuation of the special exemption for dairy co-operatives. What is the remedy for a farmer who finds himself trapped in a long-term contract in Arla, a huge pan-European co-operative, where he is not happy with the price he is getting or the way the organisation is being managed, but is unable to change either of them despite nominally having a share or stake in it? Should there be some rights for that individual member as well? Do the articles of association in co-operatives generally provide sufficient protection?

Richard Self: Obviously, there is a democratic process within the co-operatives in which you can vote people on who have a particular stance. The idea is to help control your own co-operative in doing what the membership wants. A co-operative should have a process in place whereby that can be fed into the co-operative to get the criteria right for that membership. The process of democracy within the co-operative should allow for that. I cannot comment on an individual case, but it is up to the members how they run their business. They should be able to set it up the way they want it.

[George Eustice]

Q I suppose the key question is: if the views and interests of a British minority, for instance, were compromised by the majority in a big pan-European cooperative because of a decision taken, should they not be able to exit with a set notice period, for instance, and have a clear mechanism for doing so?

Richard Self: I would hope so, yes. But I am not an expert in the dairy industry, so I would need to investigate that further; we are happy to look into that. I have good contacts with our dairy co-operatives and can help feed that into the system.

[Daniel Zeichner]

Q Earlier, you touched on some of the opportunities around data. Will you amplify on that? What support might be needed to make the most of those opportunities?

Richard Self: Increasingly, farmers will have better data on their anticipated crop yields, milk yields or whatever. They can collect that raw data, and farmers can trust their co-operative to handle it in the right way for them. That data is useful and is worth money to others in the supply chain. It is a question of how they can work together to maximise the use of that data for the benefit of the supply chains they are working in.

--- Later in debate ---

[The Chair]

Before I move on to Mr Egan, may I say that this is a huge room and the acoustics are terrible, so can people speak up?

Jim Egan: I am Jim Egan, technical advisor for Kings Crops.

Graeme Willis: I am Graeme Willis, agricultural lead for CPRE, the countryside charity.

[George Eustice]

Q Will you each tell us what you think have been the main shortcomings of the existing area-based common agricultural policy; whether we can, in the short term, modify it to make it work more smoothly; and whether you support the general premise in the Bill of, in the longer term, a move away from subsidies on land tenure to support for the delivery of public goods?

Jim Egan: From my perspective, one shortcoming is that the current system does not allow fully integrated environmental and farming management. It does not let the whole lot sit together, which causes issues. One of the biggest shortcomings of the current system is its administration in my specialised area, agri-environment schemes, which will put people off, as it has in the past. I do not really want to go much further than that, Minister. There are lots of things, but that is my area of expertise.

In terms of modifying in the short term, my personal view would be not to, particularly on countryside stewardship. I do a lot of work directly with farmers on getting stewardship schemes in, and I have never seen so much demand as this year. I already have 65 people on my books wanting to do the modified schemes. There are obviously things pushing them towards that, but the simplification of the actual stewardship process has been good. We just need to get the payments and other things right in the short term, to provide certainty.

If I was going to modify anything within the wider BPS system, I would perhaps modify the three-crop rule, so I could say that we had done something. However, I think people are used to it, and it is actually very important, in a time of turbulence, that we keep it as stable as we can at the moment.

Sorry; what was your third question?

[George Eustice]

Do you support the general thrust of the future policy, moving from subsidy on land tenure to—

Jim Egan: Yes.

Jake Fiennes: If we split it into pillar 1 and pillar 2, the current BPS is rather clumsy and, in places, overly simplistic. We have the ecological focus area ruling within that, which, as Jim refers to, is cumbersome. The three-crop rule and hedge-cutting dates sort of tie farmers into a knot; they are unable to be flexible.

In the short term, farmers are preparing for a transition period, which will start in 2021, according to the current Secretary of State, although I know that some are pushing for that to be extended, because we have just seen a delay of this whole process. However, farmers are slowly taking on board that there will be seismic change within their business. It has happened over a very static two years, but we have seen a real momentum, and there is a general acceptance among those within the industry that this is coming around the corner. If they have an ability to prepare their businesses by going into the current schemes—I think the new stewardship scheme was opened today. I have not looked at it, but I think the detail made it easier and more user-friendly.

We have to put the past aside, with all the issues that we had with the RPA, Natural England and late payments. I think we have moved on from that, and I think this year was an example of the RPA demonstrating very swift payments, and the current stewardship payments are being rolled out as we speak. That is all very positive. Again, I see a greater uptake of the current schemes—the countryside stewardship higher tier and middle tier, and also the simplified scheme.

That will get farmers ready through the transition period, which comes on to the Minister’s third point, where I am in full favour of it. A slight redrafting of the Bill—talking about soil and productivity—basically got the entire land-based community on board.

Graeme Willis: I think it is well attested that the CAP scheme is inefficient, ineffective and inequitable. People such as Allan Buckwell and Alan Matthews have made that point, and DEFRA’s own research has shown that, and there have been statements, so we very much support that view. In terms of the current countryside stewardship schemes, as Jim said, it is very important that farmers keep faith with those schemes. The simplification has been very helpful.

Certainly within DEFRA, I have been making the point that those schemes are probably under-commented on, because we have a 2030 deadline for addressing climate change by cutting emissions very significantly. Four years through to when ELMs beds in is a very important period in which to get trees in the ground and to get peatland and other high-carbon soils restored. It is very important in this phase to keep putting money in and investing in farming. It is very important that farmers keep faith with that, and the schemes have been expanding, which is very welcome after a rocky start.

We believe that public goods for public money is the right way forward. It is the absolute crux for enhancing the environment, obviously addressing climate change and biodiversity issues. But, as Jim said, it is very important to harmonise what farmers do in producing food and other goods with environmental improvements which we know are very necessary. Bringing those two together is critical so that they are not seem as oppositional.

[George Eustice]

Q If at one end of the scale you have what could be called the broad and shallow but largely universal interventions that most farmers would sign up to—catchment sensitive farming or hedgerows—and at the other end you have land use change through peatland restoration or new woodland being established, what should be the balance between those competing priorities in order to really deliver for the environment?

Jake Fiennes: Are we referring to the blueprint of ELM?

[George Eustice]

Yes, in the new scheme.

Jake Fiennes: We have the regulatory payment. I hear of calls for up to 30% of existing payments that farmers receive, which is about £200 per hectare. I am certainly not in favour of that, because it will not encourage stakeholders to go into the middle tier and I think you will see a great uptake in the middle tier. On the final tier, which is landscape restoration, whether it is on a catchment basis, if we are going to have sustainable, functional land use, it has to be at scale and deliver all the climate change issues and soil regeneration. All these processes will go into the final tier and, having listened to some of the comments earlier about the smaller farmers not working well together but the bigger ones working better, we are seeing a great uptake of facilitation funds and cluster groups. This whole movement is happening. I would not encourage the lower payment to be a major factor, because we would basically go back to a reverse BPS system.

Jim Egan: My way of answering that would be to look at the fact that in the majority of lowland England, if you split it that way, you will find farmers taking up more than you think, if it is properly rewarded, if it is linked in by the rest of the industry and it is linked together. You quite commonly talk to farmers now who take out anything between 5% and 15% of their land to manage it “for the environment” and also recognise the real benefits of changing what they do: introducing grass lanes to help with grass weed control and to build soil fertility, which helps with cleaner water and so on.

I agree wholeheartedly with Jake that there is a sea change coming. A lot of people stood back, because of the political uncertainty, but they are ready for that. The higher extremes you referenced, such as peat restoration, will be a focus in an area where it can happen, getting those landowners together and talking about it. It will take time. I do not think they are completely divorced and different.

On woodland, it will fit when people start to see natural capital, particularly the natural capital potential of their land, and they have choices of what to do. Then woodland will start to happen, especially where you can get people working together and you can make the links. I would be positive about that.

[Daniel Zeichner]

Q I want to put to you a question I asked earlier witnesses. I think that the CPRE was one of the signatories to the letter to the Prime Minister expressing concern about the potential problems with importing food with lower environmental, welfare and health standards. Why did you sign that letter and what should be done in the Bill to tackle the issue? That is particularly aimed at Graeme.

Graeme Willis: In terms of maintaining standards, we are very concerned—I know that statements have been made about supporting high standards—that undercutting those standards through imports would undermine farmers’ incomes, as well as their ability to perform environmental management. I know that an amendment previously tabled to the Bill sought to introduce a broad requirement that any international trade agreement that was to be ratified must be compliant with UK standards. We think that is a major omission and one of the major things that needs to be addressed in the legislation. We have a common cause with the whole of the farming sector on that. The whole of the NGO environmental sector takes that view. It is a very important element and condition.

--- Later in debate ---

[Deidre Brock]

Q Okay. Would those be the views of Mr Willis and Mr Egan as well?

Jim Egan: I do not get involved in policy; I have never worked in it.

Graeme Willis: In terms of the breadth of it, I think it is still open to question as to how wide it goes. I am on the stakeholder engagement group, so I am limited in what I can say because of confidentiality about that. However, I have certainly seen a slide that shows how wide it might go, and there might be questions around whether it includes, for example, airport operators, which have large tracts of open grassland that they need to manage to keep trees off. Could they do positive things with that?

I think there is a very important question about the amount of resource available and whether those are the right people to receive that resource, as against farmers, given the context we talked about, the viability issues going forward and the cuts to basic payments during the transition. However, something to address the issues across a broad landscape is very important.

On whole-farm areas, we would not want large areas of farmland managed very intensively within a system in which other areas are just managed for public goods. I think they need to be combined and harmonised, as we said before, so that land is shared and used in the very best way, for the environmental benefits and for good, sustainable food production.

[George Eustice]

Q I return to Mr Egan’s point about the control and enforcement regime. If you are close to the schemes, you will be aware that the introduction in the latest EU scheme of a common commencement date—so that everybody had to start at the same time, which caused all the predictable administrative problems for everyone—combined with the introduction of the IACS enforcement regime drove the terrible, draconian regime that you describe.

One thing we have described for the future scheme is that you would instead leave all that behind, and individual farms would have a trusted, accredited adviser on agri-environment schemes. That could be a trusted, accredited agronomist, or someone who works for the Wildlife Trust or the RSPB, and they would be trained to help put the schemes together. They would visit the farm, walk the farm with their boots on and then sit around the kitchen table and help an individual farmer construct a scheme.

We are obviously testing and piloting and trialling that now. If that system could be made to work—an altogether more human system, as you said, because a trusted adviser would do the initial agreement and would maybe visit the farm three or four times a year, not to inspect but to be a point of advice—how many farms can a single agri-environment adviser with that type of remit realistically do?

Jim Egan: It would depend very much on type, size, place, aspect and everything. I do not think you can put a number on the people that you could hold as clients. I actually do not know how many clients my agronomy colleagues have, because I am new to that business. However, where I work, I would be perfectly comfortable managing 40 or 50 clients and working through with them.

The main premise is not to overlook that that process of walking the farm with a trusted adviser already happens for countryside stewardship. Most farmers will take advice and will rely on somebody working with them. The opportunity that comes from splitting out and putting everything into ELMS—including all the basic payment elements, so that it is one big agricultural and environmental processing scheme—actually means that you can widen that advice and make it broader. The trick will be that those advisers will have to have knowledge of the farming business and will have to talk to others within the business. Even on a small dairy farming unit, they will have to talk to the vet, the feed merchant and the farmer. It is a facilitation skill as much as anything else, and it will require an understanding of how those farming sectors work.

This is definitely the right way to go. We will need professional advice to do that. A farmer doesn’t grow an arable crop without an agronomist. You don’t grow beef cattle without a vet or a feed merchant. So why should you not have what I would call environmental facilitators?

[George Eustice]

Q Based on your assessment of 40 or 50, you would need somewhere in the region of 1,500 to 1,800 of those in England to cover most farms. Is there capacity at the moment in the agronomic and environment NGO world to allow people to go for training and accreditation? Or is it your view that it would be better simply to recruit additional staff at Natural England or the RPA to do it?

Jim Egan: First, I do not think they should be recruited by Natural England or the RPA. Within the supply chain, there are probably sufficient people. An agronomist has to be trained and to get your agronomy diploma you have to do a BETA—biodiversity and environmental training for advisers—certificate in conservation management. It is only a three-day course, but it is about awareness. Whoever is drawing up the scheme will need to pull on other skills and pull and bring the environmental community and the farming community together. A good person does that already. I do not think you need a new qualification. The qualifications are there. The BETA certificate in conservation management and that type of approach already addresses some of the issues. It would probably need an upland module and a little bit more focus on grassland, because it is an arable-focused course.

I also believe that it is Natural England or the RPA’s responsibility, if they get a bad application, to send it back. I went to DEFRA and Natural England about eight years ago and asked for that to happen and it never did. Natural England continues to re-work bad applications. Once you do that, the farming community will soon know not to go to that person. It doesn’t need degree level; it needs an element of a qualification, a CV and management by a managing authority that is not afraid to take people off the list if they are not doing the job properly.

[Fay Jones]

Q Clause 13 provides the power to opt out of direct payments in favour of a lump sum, and therefore opt out of agri-environment schemes. Do you see that as a risk of losing a skillset within the agricultural sector or an opportunity for new entrants and new ideas?

Jake Fiennes: If I am brutally honest, I do not think the Treasury would sign up to that. If we all opted out, we couldn’t afford it. I am intrigued that that is still on the table.

Earlier you referred to land values. How to devalue very quickly? Everyone opts out and land values plummet —in an industry that is generally reliant on that support in the way it currently manages land.

Graeme Willis: When I heard about this in the original Agriculture Bill, I was concerned that no constraints were placed on that money. I was not clear about the rationale for that. If the rationale is for new entrants, there is an issue if that is only done through land prices falling. I am not convinced that we can guarantee that when a farm is sold, a new entrant will get that farm. There is no control over that, so it seems too broadbrush. It also seems somewhat a hostage to fortune because large amounts of public money being paid out for what is not a clear set of purposes could play very badly with the public; other people have raised that concern. If that were tied to some investment into the farm, there is an element of advantage there to having a lump sum to invest that could meet the other purposes to improve the farm’s environmental performance and productivity. Also, it could be good if it were tied in some shape or form to supporting new entrants.

Earlier, there was a mention of share farming—some form of succession where there is no son or daughter to pass the farm on to, some mechanism where that was locked in to ensure that a new entrant could get on to a farmstead and actually learn. You mentioned skills: they could learn from the skills of the farmer on that farm and not lose the knowledge of the land, the aspect, the farming and the culture of that farm, and pass that on to a new, younger or older person with a different set of skills. That would be really interesting.

I see it as too broadbrush and not clear at the moment, and I have concerns. I understand that that will be consulted on, but I am not sure whether that is clear from the Bill as it stands, or whether that can be clarified.

--- Later in debate ---

[Mr Goodwill]

Q I am trying to get my head around the deal in payments with respect to an early retirement scheme. When answering an earlier question, you talked about the way it could affect the value of the land. Could there be a situation in which a tenant takes the money and runs, and then the landowner is looking for a new tenant but without the agricultural support? It is difficult to attract one. How will the environment be managed if the payments that would have been forthcoming for the environmental land management schemes were not there? What would happen in practice in a situation where a tenant takes early retirement and takes the money, and then expects the landlord to pick up the pieces?

Jake Fiennes: There could be a technical mechanism relating to tenant’s dilapidations from the landlord’s perspective. The landlord could seek to recoup that if he was going to devalue the land by taking those future payments away. There is a technical mechanism that allows that to happen. That strengthens the landlord’s ability to retain that land to rent to others or to new entrants. It is important that there is some kind of mechanism within the Bill for that. Potentially there would be land abandonment because it has no value, or we would see deep intensification of land areas that have no support mechanism. Then we are trying to deliver environmental land management on a landscape scale, and we have these blackspots in between with no support mechanism. That would be my concern.

[George Eustice]

Q On that point: do we want land rents to stay as high as they are? Would it not potentially be beneficial for landlords to have to fight one another to attract tenants on to their land?

Jake Fiennes: Land rents are artificially high based on the support mechanism. We will see that slowly diminish. Commodity prices will periodically affect land prices. The horticultural sector does not rely on support at all. The average age of the British farmer is 62: land rents are overly high and they will be reduced, thereby suddenly allowing new entrants to come in who will be more open to environmental land management and public goods proposals. We will see a wholesale change. We are expecting a recession in agriculture through this transition period, for all the reasons being discussed today. Where there is change there is opportunity, and the opportunities are there for another generation to move in and manage land environmentally, economically and sustainably.

[Chair]

If there are no further questions, I thank the witnesses for attending today on behalf of the Committee.

Examination of Witnesses

Judicaelle Hammond and George Dunn gave evidence.

[Chair]

We will now hear evidence from the Country Land and Business Association and the Tenant Farmers Association. We have until 5pm. Welcome; please introduce yourselves.

Judicaelle Hammond: I am Judicaelle Hammond. I am the director of policy and advice of the Country Land and Business Association.

George Dunn: I am George Dunn. I am the chief executive of the Tenant Farmers Association of England and Wales.

[George Eustice]

Q I will ask a question that I asked the National Farmers Union earlier: if we had a world in which there were no basic payment scheme payments—no subsidy on land, tenure or occupation—and tenants came in and only paid the rent on which they could still turn a profit, what is the correct value of land rents in an upland area, or a typical lowland area?

George Dunn: That is an interesting question, and one to which there is no simple answer. There are two codes of tenancy in play. One is the code under the Agricultural Holdings Act 1986, and one is under the Agricultural Tenancies Act 1995. The 1986 Act has a formulaic approach to rent. It steers you away from the market. In my view, if you look at the rents that are on Agricultural Holdings Act tenancies, they are probably more akin to an affordable level of rent. We are seeing around £80 per acre on arable, £50 to £60 per acre on grass and up to £100 per acre on dairy.

The farm business tenancy rents, which are driven by tender rents quite a lot, are far too high. We often see rents for arable ground in excess of £200 per acre and over £200 per acre for dairy ground. Those are clearly unsustainable. I would direct the Committee to look at the sorts of evidence you would get from the 1986 Act as to what a reasonable level of rent is.

Judicaelle Hammond: I do not think it is that easy. As George was saying, several things make up land rents. One of them is what you can get for what you do with that land. It is right that it should be left to the market. It may well be that some of the rent levels are unsustainable. I think they will probably adjust as we change regimes, but I do not think that being bound by a formulaic rent system is a good idea in a system where there is uncertainty in trading conditions and there needs to be some flexibility.

George Dunn: To add to that, the problem with an open market system is that the market is so slim, and the evidence is so hard to come by. Therefore, you tend to be driven by the froth in the system—the tender rents. If you look at DEFRA’s own figures, the average farm business tenancy rent on an arable farm is about £100 per acre, but the tender rents suggest they should be double that. I just think we need to ensure that we are not wholly going with the market level.

[George Eustice]

Q I suppose the point I was making was less to do with the market. If you removed from the market the roughly £100 per acre basic payment scheme payment—if that just vanished—what is the land then worth to rent? I am assuming that it was a market rent, but it would become, potentially, a buyers’ market rather than a sellers’ market, as now.

George Dunn: On that point, we would see the farm business tenancy rents under the 1995 Act move more towards the level of rents we would see under the 1986 Act. They might fall a little bit, but because they take into consideration the productive and related earning capacity of the holding, that would reflect better what that holding can physically produce.

[George Eustice]

Q I have a linked question, although it might be too complex to answer. From the CLA’s point of view, at what point does it cease to be worth renting land and start to make more sense to bring it in hand and farm it yourself without a subsidy?

Judicaelle Hammond: There is no easy answer to that, because the circumstances will vary. I think it very much depends on what the person who owns that land wants to do with their holding. It may well be that, due to questions other than just land rents, they want to bring it in hand. It may be that there are other things they want to do on that land—for example, tourism or something completely different to agriculture—or it may be that renting the land to tenants suits them and they will continue doing that. That will vary according to the owners’ vision for the land and the stage they are at in terms of their business.

[George Eustice]

Q On tenancy issues, your organisations famously do not always agree, but on the future direction of travel for policy, do you both agree that a move from an area-based subsidy to payment for the delivery of public goods is the right way to go for agriculture policy? If you have any concerns about the development of that, what are your key concerns about what might go wrong in that transition?

Judicaelle Hammond: We would totally agree, as the CLA, that this move is the right move. We have been a proponent of moving towards payment for public good for a while now. The Bill is welcome. We also welcome the inclusion of soil quality, for example, and the consideration of sustainable food production and food security in the Bill. The fact that there is now going to be a multi-annual framework for financial assistance is also important, as is assistance for productivity improvement.

Regarding what we would want to see, there are two main aspects, as well as a number of other improvements, which I might talk about later. One is making sure that the transition is right. At the moment, we are missing information, not just about what is going to happen next year, but about residual payments for individual businesses over the rest of the transition years. We are missing the kinds of details about ELMS that will make it possible for those businesses to make decisions about where they want to take their business, and in particular, of course, about payment rates. In the absence of those details, and given the uncertainty in trading conditions, we would like the start of the transition period to be pushed back by one year without moving the start of ELMS.

The other issue that we have is about trade standards, which the NFU and others have spoken about. We certainly share their concerns.

George Dunn: I would take you back a little bit, Minister, and just say that we need to be really careful. Despite the fact that there is a great deal of criticism of the CAP, and the way in which the basic payment scheme operates and its impact on rents, we need to be clear that those payments are being received by individual farms right up and down the country that are doing the right things on the environment, animal welfare, consumer safety and all those issues. If we simply remove the BPS payment without properly thinking through the changes that we need to make, we risk the good work that we are doing. That is why we have been saying that we are making changes for a generation, and they need to be done well rather than quickly, so we support the CLA’s stance on delaying the transition. We think that we have concertinaed the work on ELMS, for example, too much to try to bring that forward into a sensible place.

Also, while we support the general move towards public payments for public goods, we see that move alongside the productivity elements, which we believe are really important as well. The Bill has a couple of lines on productivity, but we want to see much more about how that can work alongside creating resilience within farm businesses. There are also the trading elements and ensuring that we are not undercut by cheap imports from abroad, produced to standards that are illegal here; the fair dealing practices; and the issue of access to the tenanted sector. Schedule 3 goes some way towards addressing that sector, but it needs a little bit of work.

[Daniel Zeichner]

Q Good afternoon. In general, what changes would you like to see that would improve this Bill, from your point of view? I am particularly looking at George.

Judicaelle Hammond: The main one, as I said—I will not labour the point—is the delay in the start of the transition. It also seems to us that a couple of other things would be improved if they were done differently. For example, the multi-annual framework for financial assistance is five years. I can see why it has been done like that, but that means that it is at risk of being entangled with the political and election cycles. As far as I know, farmers in the EU—which is going to be our closest competitor—will still have seven years to plan. That is closer to the business cycle in agriculture, so we would favour lengthening the period covered by the multi-annual financial assistance framework.

The other thing that could be added to the Bill is a provision on rural development and, in particular, socioeconomic funding schemes. In the new world, that is going to be done via the UK shared prosperity fund, but that is not due to arrive until 2022 at the earliest. What would happen if that got delayed, or got into other difficulties? We would like to see some provision to make sure that it is possible for Government to continue socioeconomic schemes.

Those are two important improvements. We would also want to make sure that any moneys that are recouped from direct payment, particularly in the early part of the transitions, are used for productivity and ELMS pilots and do not go back to the Treasury.

George Dunn: We agree on the issue of trade standards. We think we need to nail that wholly into the Bill to ensure that we are not undercutting our high standards here and offshoring our issues abroad.

While there have been some helpful statements from the Government, we are concerned about some of the rhetoric that appears to be emerging, particularly from the Prime Minister’s Greenwich speech, where there was an indication that we would not necessarily insist on our laws being protected in trade deals, which is rather worrying. Of course we were also promised free and frictionless trade with the EU on leaving the European Union, but we hear the Chancellor of the Duchy of Lancaster saying today that we need to prepare for issues at the border when we end our implementation period.

On the fair dealing section of the Bill, we should nail down the fact that that should be regulated by the Groceries Code Adjudicator. The Bill leaves it hanging as to who should be the regulator. There is a suggestion that the Rural Payments Agency has a role to play; I would disagree. As the CLA has said, we need a delay in the transition period by one year, which will give us sufficient time to think about these things more deeply.

The access for tenants to schemes needs to be addressed, because schedule 3 to the Bill provides a provision only on a “may” basis. We want it to be a “must” basis that the authorities come forward with regulations. Currently, that applies only to the 1986 Act tenants, not the 1995 Act tenants. As that is half the tenanted sector in agriculture in England, we think that should be changed.

On the food security section, we want the report to be annual, not five yearly. Finally, in the financial assistance plans, the missing thing is the word “financial”. There is no commitment to say what the finances are going to be in any one year over the five-year period. That needs to be nailed into those plans as well.

--- Later in debate ---

[Mr Goodwill]

Q Chapter 2, clause 8 deals with the possible extension of the period. I may not understand it particularly well, but it does not make it clear whether, if there is an extension to the seven-year period, that would pause the transition from BPS to ELMS, or whether that would just continue, but at the end of the seven years there would be an extra year or two under the full ELMS system. If there was an extension, at the same time, could that be coupled with a freeze in the transition for a number of reasons, including that the ELMS was not being taken up as quickly?

George Dunn: Yes, and I think that is what the Bill intends. My reading of the Bill would suggest that that is what would happen under those circumstances. To go back to the previous question, if money was taken out of the system that was not able to be spent through the new arrangements, that would have to be paid back, in our view.

[George Eustice]

Q A previous witness said that if a tenant farmer exercised an option that we set out under clause 13 to take a number of years payment in lieu as a lump sum, under the way tenancy agreements tend to be drafted, the landlord would say that was a dilapidation and would take compensation off the tenant farmer. That seemed a rather extraordinary extension of the conventional interpretation of dilapidation. What would your respective views on that be?

George Dunn: My view is that the answer you were given was nonsense. There would have to be a very specific clause in a tenancy agreement that provided for the circumstances that you are describing—for a landlord to be able to dilapidate a tenant for taking away the payment, which is rightfully theirs anyway, because it is their entitlement to do with that what they will.

We are actually quite excited by the provisions on the lump sum and the extent to which that could generate some really good restructuring within the sector. I do not think there will be an impact on land values as was suggested, because land values are driven by much more than the agricultural return, which is about 2% of the average land value, when you look at how agriculture operates. There might be an impact on rent, which could be a good thing for the sector in terms of productivity and margin and efficiency, but we think that the lump sum elements are certainly something worth pursuing.

Judicaelle Hammond: I think we are a little bit more cautious without more detail. We look forward to the consultation that will happen on the secondary legislation. It is hard to say how it would work and whether there would be any unintended consequences without more detail. The same thing is true of the lump sum. We can see opportunities, both for retirement and investment in the farm, but at the moment, we also see that it could have all sorts of unforeseen consequences. We really do need to have a thought-through view of how the system would work.

[George Eustice]

Q The final question from me is about schedule 3, which sets out in some detail a range of quite technical changes to tenancy law that have come out of the TRIG—the Tenancy Reform Industry Group—recommendations. Are you both content with what is being proposed for those changes to the commercial unit test and so on?

George Dunn: Minister, you would be surprised to hear me say that we are absolutely content and there are no other changes that we would want to make, and I am not going to say that. There are elements that we think need to be added—for example, what we were talking about earlier in terms of the provision for farm business tenancies, for encouraging longer-term lets, to give landlords the option of ending those early, but only for those who are letting for a long time. We think that the provisions in relation to tenants’ access to diversification, financial assistance and fixed equipment need to be extended to include 1995 Act tenancies.

I noticed that a question was raised by a Member on Second Reading about widening the franchise of succession to include nephews, nieces and grandchildren, which was not adequately answered by the Secretary of State. Perhaps there is an amendment that could be brought to look at widening the franchise. Very often, it is the nephews and nieces and grandchildren, rather than the sons and daughters, of farmers, who are the active individuals. So there are certain changes that we will promote through amendments to the Bill.

Judicaelle Hammond: What I have said before about schedule 3 stands. We do not particularly like the commercial unit test removal; we think that it is actually well worth having and it should be strengthened. Why would individuals who are already successfully farming elsewhere have the privilege of reduced rent? It does not seem fair and it does not make sense. Apart from that, my significant concern is with the arbitration proposal for dispute resolution on landlord’s consent.

There are a number of things that the CLA welcomes in there, for example provisions relating to landlord investments, which we think will provide protection for both the landlord and tenant, and the removal of the minimum retirement age of 65 and also the widening of the pool of potential arbitrators. We are not opposed to the whole of schedule 3, but we certainly have significant concern with what is in there at the moment. We certainly would not favour any extension to the AHA tenancies, which we regard in this day and age, and given the flexibility that the market requires, as an outdated system, which certainly should not be prolonged.

George Dunn: You would not expect me not to disagree with what Judicaelle has said about AHA tenancies. If we trusted the landlord community with farm business tenancies to deliver sustainable, long-term, sensible tenancies, we would not be hanging on to the AHA tenancies as much as we are. Sadly, the landlord community has not played the game well in terms of farm business tenancies, in the way that they have delivered those.

The commercial unit test that Judicaelle talked about is a capricious test. It hits people when there is a death out of time, or people who are badly advised. That is all. It is a very expensive test to have advisers help you through. In essence, the Bill is about productivity and increasing efficiency. Having the commercial unit test in place hits those individuals who have been go-ahead, and have been looking to get themselves on rather than waiting for dad or mum to die in order to get the tenancy of the farm. Why should they be penalised when they have been the ones who have been go-ahead, and those who are not so go-ahead get the opportunity to succeed?

[Ruth Jones]

Q My question is to you, Mr Dunn, with your expert Welsh agricultural hat on, if you please. Given that the Welsh Government will not legislate until, at the very earliest, the middle of 2021, and given that the payments for the direct payment schemes will begin to diverge across the UK, what do you think the consequences will be?

George Dunn: We are in discussions with Welsh Government officials, as you might expect. This morning, I was having discussions with their policy lead on tenancies. Certainly, I would take from the discussions that we have had to date that there is a real understanding of the need to ensure that they are moving at a pace that allows tenants to have access to the new arrangements.

In the context of having devolved Government, there is no point in having devolved Government if you just do what England does, so there will be specific things for Wales that we will need to look at. I know that the Welsh Agriculture Minister has some aspirations for that in Wales. We are waiting for a White Paper from the Welsh Government that is coming later this year. We are having input into that White Paper. Obviously, they have not reserved the rights for the financial assistance powers within the Bill, but the agricultural tenancy section—schedule 3—applies to Wales and England equally.

Judicaelle Hammond: We represent farmers and landowners in Wales as well. I think that, given the framework of devolution, there needs to be some flexibility. Like previous witnesses, we are a bit concerned where either the implementation of the Bill or, indeed, the way that the money is allocated across the UK changes to such an extent that we see intra-UK market disturbances. We would certainly argue that that should be avoided.

Agriculture Bill (Third sitting)

George Eustice Excerpts

Committee stage & Committee Debate: 3rd sitting: House of Commons
Thursday 13th February 2020 Public Bill Committees

[The Chair]

We will now hear oral evidence from NFU Cymru, the Farmers’ Union of Wales, and the Welsh Government. Thank you very much for coming and welcome. We have until 12.15 for this panel. Would you introduce yourselves before we move to questions?

Huw Thomas: I am Huw Thomas, NFU Cymru political adviser, based in Builth Wells.

John Davies: I am John Davies, president of NFU Cymru.

Tim Render: I am Tim Render, director for environment and rural affairs in the Welsh Government.

Dr Fenwick: I am Nick Fenwick, head of agricultural policy for the Farmers’ Union of Wales.

[The Minister of State, Department for Environment, Food and Rural Affairs (George Eustice)]

Q 141 Schedule 5 to the Bill makes explicit provision for Wales, and in particular gives the Welsh Government the power to amend, modify and improve the legacy common agricultural policy scheme. What would be your priorities for that simplification? What are your key concerns about the existing CAP, and, if the Welsh Government had a free hand to improve and simplify it, what would you like them to do?

John Davies: Thank you, Minister. Obviously, we await any announcements eagerly. We would look to amend where there are, we would say, unfair penalties for minor infractions. There are major improvements to be made there, for instance. There will be a need for more trees to be planted in future; where there are hedgerows or woodlands, at present, they are taken out of any calculation. There are minor adjustments to be done there that could reduce stress quite significantly in the interim period, I would suggest.

Dr Fenwick: We entirely agree with that. Penalties are a huge issue. It is widely recognised that they are very often completely disproportionate to things that have no impact on the wider environment or the general public. Things that may have cost Government, for the sake of argument, a few pounds, can incur fines of many thousands of pounds.

Greening is another issue. The 100 trees per hectare limit has had a very big impact and goes completely against the current thinking on the importance of trees. The way that it has been implemented in Wales—understandably, given the wording of the European legislation—seems counter-intuitive, given the priorities in terms of silviculture and agriculture co-existing.

Tim Render: From the Welsh Government perspective, we consulted on this question in our last document on ideas for taking farming policy forward and future farm support measures. We also identified that, as part of the transition, you would need to look at simplification. The four things that we flagged were very much penalties, as union colleagues have identified; some of the issues around cross-border payments and the single application rule; the basic payment scheme window for unvalidated beneficiaries; and how the environmentally sensitive permanent grassland rules operate. As I say, those are things that we consulted on. We are assessing the consultation responses at the moment and will make policy decisions on how to implement that when we have the powers, through the Bill, to implement—potentially from 2021.

Huw Thomas: One thing to point out is that the powers relating to Wales in schedule 5 are far more modest than those described for England in clause 9. The scope of the ambition for Wales is perhaps somewhat curtailed by that. In relation to England, you have far more powers to remove and reduce burdens, penalties, financial costs and so on; for Wales, the powers are a bit narrower in scope. That is just something to note.

[George Eustice]

Q What about the so-called greening rules? When those were introduced, environmental non-governmental organisations said that that was greenwashing and farmers said that it was green taping. Perhaps both were right, in that it has not delivered much, if anything, for the environment and it is responsible for about 50% of all the guidance that we have to issue. Do you take the view that it is better just switched off altogether, so that we do not have the crop diversity rule and do not have the ecological focus area rules, either?

John Davies: I would say that it is very difficult to farm in a prescriptive way. We have a real challenge this year with the weather, which will cause real issues around the three-crop rule, so we need to be flexible in our approach there, because it is simply not practical in some areas at some times. We need more flexibility.

Dr Fenwick: We agree entirely. Something that is aimed at certain types of farms has actually had an impact on the types of farms that it was not aimed at—I am talking about the impacts of greening. Indeed, that has been recognised across the EU. The European Commission is undertaking the same process of looking at greening and how it should be improved, and has taken steps in that direction. I think it is universally recognised as completely disproportionate.

Tim Render: We would be happy to look at that in the light of the consultation responses we get.

[Daniel Zeichner (Cambridge) (Lab)]

Q Good morning, Mr Stringer, and good wishes to those on the Government side who may have a nervous day ahead—we wish you well. My question is one that we have put to other witnesses before. We are obviously very concerned about the potential threat to farmers if food is imported that was produced to lower health and welfare standards. What is your view on that and what do you think could be done about it in the Welsh context?

John Davies: We have a very clear vision and ambition to lead the world in producing the most climate-friendly food, and that is to be realised with proper policy and proper support going forward. Obviously, it would be a disaster if that were then undercut by food production systems that are illegal in the United Kingdom, so we would be deeply concerned about the opportunity there and we would like to see that much more strongly identified in the Bill and ruled on.

We welcome the comments that a number of you made during the Second Reading debate. Also, Liz Truss, International Trade Secretary, said last week:

“In addition, nothing in any agreement will undermine the Government’s commitment to tackling climate change.”—[Official Report, 6 February 2020; Vol. 671, c. 15WS.]

We lead the world with our commitment to net zero by 2040, so we look to that being honoured. That is an absolutely key statement to us going forward.

Dr Fenwick: In clause 36, which relates to organic products, subsection (5) makes it clear that it is possible to restrict or prohibit the import of organic products. That will be legislated for once the Bill becomes an Act. We would have expected an equivalent paragraph or provision relating to other production standards to have been incorporated in the Bill. It is there for organic, yet it is not there for all these other issues and in particular the key issue that John raised—our environmental and climate change obligations.

--- Later in debate ---

[The Chair]

The acoustics in this room are appalling. Can you speak up and project your voice?

Gareth Morgan: Yes, will do.

[George Eustice]

Q You know that in the new Bill, compared to the one in the previous Parliament, we have added an explicit purpose around soil quality. Will you describe for us how best to measure soil quality or soil health? What kind of management interventions should we encourage under the Bill’s provisions?

Gareth Morgan: Unsurprisingly, we were delighted to see that addition, which we thought was a grave omission last time round. There was a rather arcane debate around whether soil health was a private or a public good. What matters is that we achieve better soils, because we know that there is a soils crisis. Indeed, Michael Gove highlighted that in some of his speeches.

The other problem, as you allude to, Minister, is that soil is highly geographically variable and contains many different parameters, from organic matter in terms of the ability to sequester carbon to soil biodiversity, productive capability and the rest of it. That challenge has made it very difficult to set standard provisions around soils for farmers to follow. I suspect that that side of it will probably be best developed through the 25-year plan in the Environment Bill, so in a sense the Agriculture Bill is the place where the tools for farmers to improve their soils can be placed, and where the provisions around what sorts of soils we need, and where, will need a lot of research and geographical specificity. Farmers will need assistance to understand their soils, so a top-down approach to the same soils everywhere is probably not the right way to go.

One exception is that the concept of a steady increase in the carbon content of soils seems to be widely accepted. I think the UK is in the “4 per 1000” club on this, which is around a steady percentage increase of organic matter in soils. That will be a useful single aspiration for farmers and policy makers to coalesce around.

[George Eustice]

Q Soils have been around for a very long time and the human race has worked out how to grow crops on them, so I never understand why people say we need huge amounts of research when we know how soil works. Soil science is not new.

Gareth Morgan: The lack of knowledge should not be used as an excuse to not do anything. I agree with you that far. In terms of understanding at the field level what a particular farmer needs to do, I do not think I agree that that is always obvious. You might have shared the same train journey that I had today from Bristol. Going through Wiltshire and looking at the waterlogged soil-laden water lying on the fields, so that it is pouring into the River Avon at the moment, is a signal to me. That is not necessarily the fault of the farmer, but there is a gap between academic understanding of what soils should be like and what is happening in practice in the fields. There is a huge need for farmers to better understand what is appropriate on their farms. That will involve a fair bit of Government investment to help them in that process.

[George Eustice]

Q Some suggested as long ago as the 1930s—such as Albert Howard, who was seen by many as the father of the organics movement—that humus in soil is the key criterion to target, because that links to mycorrhizal activity and soil health more generally, carbon in the soils and the growth of various micro-organisms. Would you subscribe to that?

Gareth Morgan: Yes. The Soil Association is rooted in the philosophy that the essence of successful farming lies in the soil. There has been a welcome resurgence of interest in soil over the last few years. It is not an exclusive club; there are things such as minimum tillage, which is not necessarily an organic philosophy. A lot of farmers are increasingly focused on soil as the central organising principle of productivity, pest resistance, carbon sequestration and biodiversity, but that recognition still has a long way to go. I do not think organic is the only way in which that can be achieved, but it is one simple codified way of farming that we know builds on that understanding of soil and organic matter in soil.

[George Eustice]

Q If we tried to return to a general principle of more sustainable farming practices and husbandry, but recognising that the majority of farmers will probably want to stop short of becoming fully organic, could certain things be borrowed from organic production—traditional approaches to farm husbandry that could be deployed in more conventional farms? Or is it your view that nothing works unless you go the whole way to be fully organic?

Gareth Morgan: No, I would not say that. That is why there is increasing use of the term “agroecology”, to suggest that there is a more inclusive approach to sustainable farming. Organic is a great codified way of doing that and guaranteeing to the farmer and the consumer that the farmer is following a particular practice, but agroecology is wider in the sense that it incorporates practices such as mixed farming, where there is a mixture, or ruminant livestock and arable so there is a natural fertility cycle. It incorporates a focus on reducing pesticides—it would be fantastic in the Agriculture Bill to have some target for the reduction of pesticides as an aspiration—and a focus on leguminous plants, to increase nitrogen naturally, to avoid the use of artificial nitrogen. We are going to have to wean ourselves off artificial nitrogen at some point if we are to meet our carbon targets, because we have not found an alternative way to make it. All those practices can be incorporated into conventional farming systems.

[Daniel Zeichner]

Q Since the earlier iteration of the Agriculture Bill, there has been wide acknowledgment that we face a climate crisis. As part of that, although clearly different in different parts of the country, there is a crisis around our soil, is there not? Could you say a little about how intense that is?

Gareth Morgan: There is a soils crisis, which is expressed in a number of different ways. It is probably slightly alarmist to talk about a certain number of years of soils left, which is quite graphic and gets people engaged in the topic, but that will be different in different places. Soil can regenerate, so we should not look at it as a one-way trajectory of decline; we know ways in which soil can be recovered. The decline in organic matter in soil is a key dimension of that crisis.

The other big element of soil health that has been neglected by the environmental side as much as by the farming side, is biodiversity in soil. I assume that is as simple as the fact that it is below the ground, and therefore you do not see it. I heard an interesting statistic the other day: in a typical sheep field, the weight of creatures underneath the field far exceeds that of the animals on the surface, whether as simple as worms or down to bacterial and fungi. The problem is that, because we do not see it, it is not that immediately obvious to us. It becomes obvious through things such as feeding birds in the winter—the number of lapwings on the fields. If there are no invertebrates in the fields, there will not be birds above them. Getting back to a sense of the biodiversity of soil will be a good way to re-engage with it.

--- Later in debate ---

[Miss Dines]

Q That would be a huge piece of work, would it not—like a national survey of each individual farm. If you want to set targets as you suggest, are you saying that that is realistically what the Government have to look at? Can there be a more pragmatic approach?

Gareth Morgan: I think a soil organic matter target nationally is realistic. I think there is a fair consensus that increasing organic matter in soil ticks so many boxes that that is something that would be useful. That does not necessarily help the individual farmer to know what needs to be done on their farm. There is a good national soil survey, so there is good spatial information about soils that we could be using as part of this process, so it does not all have to be done from a base of no knowledge.

[George Eustice]

Q I just wanted to come in on this point about targets. I know they are the tool that people often reach for—they say we should just have some statutory target—but you said yourself at the beginning that it varies considerably from soil to soil, it is hard to measure these things, and an enormous amount of research is needed. I have sometimes been told it will probably take eight years to do that sort of research.

Given the complexity of the issue, is there not a danger that if you are waiting to try to identify the target, you end up effectively delaying action—the worst of all worlds? Does it perhaps matter less that there is some sort of prescribed target, and more that you encourage and incentivise good soil husbandry from year one as best you can with the knowledge that you have? You can measure trends. You can get a sense of whether the trends that matter are moving in the right direction from the interventions you are doing. Is not that perhaps a better way to approach these things than some kind of prescriptive target?

Gareth Morgan: I think you are right, in the sense that the best must not be the enemy of the good, and there is plenty that can be done on soils tomorrow. I do not think I agree that the absence of a target is something that we should be content with in the long term, particularly at the Government level. Targets have been useful in focusing the attention of policy makers on results. The farmland bird recovery target, although the bane of many people’s life, was useful in terms of focusing attention on what could be done to reverse the decline of farmland birds.

I think national targets around soils would be helpful in terms of focusing and attracting funding. Ultimately the Treasury is going to come and say, “I can see you are doing lots of interesting things on your farms; what, actually, are you benefiting, in terms of the natural capital account for the country?” Unless we can go back to the Treasury and say, “This investment of £2 billion or £3 billion has achieved the following things over this period,” I suspect the money will dry up pretty quickly.

[George Eustice]

Q There was another area of the Bill that I wanted to ask your view on. It is further on—there is the clause relating to organic, principally marketing, standards. That is, in essence, the primary powers that we would need to amend the organics regime that we have inherited from the EU and that itself is about to change.

Are you content with the revised organics regime that we are about to inherit from the EU, as it stands, or would you be interested in us using these powers to make specific changes that might make the future UK organics regime work better?

Gareth Morgan: That is a little bit off my area, so I will not speculate too much. The Soil Association is only one part of a very broad organic movement, so there are a number of players who, I think, will want to come back. I think the general feeling was that the provisions in the Bill provide the right enabling starting point for creating a domestic structure around organic regulation.

The one concern that I have heard expressed is that, given we have quite a collaborative model for developing organic standards and lots of players in this country, building that level of engagement with the various players and consultation into that process will be important. At the European level, the International Federation of Organic Agriculture Movements, or IFOAM, has been involved in the ongoing development of organic regulation. We will clearly need to have something similar at a domestic level to ensure that everyone, from the farmers to the certifiers to consumers, has a stake in the development of the regime.

[Daniel Zeichner]

Q Two questions: first, in some of your evidence you have suggested that there should be a public health aim within the Bill, and I wondered whether you could tell us a little more about how you think that might work. Secondly— you have touched on this a bit in some of your contribution—who do you think is best-placed and qualified to negotiate and administer the new environmental land management schemes? Are there any potential conflicts of interest in that set-up?

Gareth Morgan: Taking the first point, it does feel that there is still a gap in the policy and legislative architecture in agriculture. We have “Health and Harmony”, which sets out a good, new, broad trajectory for agriculture, and we have quite a technical, nitty-gritty enabling Bill here in terms of saying, “Here are the tools that can be deployed to achieve things.” At the moment there is not anything knitting all that together to say, “What are food and farming for? Do we have any sense of what the right model might be?” I suspect that is perhaps a bit of a legacy from having had the CAP, which was a prescriptive and sometimes flawed model of European farming. We have almost moved away from that to being afraid to say we have any preferences at all. We have a series of tools and a broad aspiration that farming should be good for the environment, and then the market does the rest.

The reason for putting down a marker on public health was to say that food and farming are not just about a commercial transaction; it is of huge national importance whether people have secure and healthy food supplies and access to the right sort of food and whether the farmer is able to get a just return from the market. Some of those things are touched on in the Bill, but it almost feels like there needs to be something right at the front of the Bill to say what all this is for, as opposed to, “What should we pay farmers for and how?” It feels a bit too fast. That does not necessarily have to come in the Bill, but it has to come somewhere, to our mind. Again, that is where we would say that a presumption in favour of a move to a more agroecological way of thinking about farming probably would sit. Equally, it is the place where the national food strategy would fit in to say that food is more than just a market transaction for consumers.

[Daniel Zeichner]

You do not have to answer if you do not want to, but the fact that you are treading warily tells us what we need to know. Thank you.

[George Eustice]

Q On that point, you made a reference earlier to the need for advisers. You will be aware that the concept behind the future policy is that there will be an individual agronomist—possibly from the private sector, possibly from groups, perhaps even from your group or the Wildlife Trusts—who would be accredited by the Government to help farmers put schemes together and to walk to the farm and sit down around the kitchen table to do that. I think I am right in saying that the Soil Association already accredits organic producers and growers, probably under a similar model. I wondered if you might explain how that process works. How many clients—for want of a better term—can an accredited Soil Association adviser look after in a typical year?

Gareth Morgan: I should first say that other certifiers are available—for example, our colleagues in Organic Farmers and Growers. It is a competitive market. I am not from the certification side of the organisation and so I will follow up with written evidence on that point, if that is acceptable.

[The Chair]

Thank you. If there are no further questions from the Committee, I thank you, on behalf of the Committee, for giving your evidence, Mr Morgan.

Ordered, That further consideration be now adjourned. —(James Morris.)

Agriculture Bill (Fourth sitting)

George Eustice Excerpts

Committee stage & Committee Debate: 4th sitting: House of Commons
Thursday 13th February 2020 Public Bill Committees

[The Chair]

We will now hear oral evidence from NFU Scotland, Quality Meat Scotland and the Scottish Government. Thank you for coming. The panel will finish at 2.30 pm. Could you introduce yourselves for the record?

Alan Clarke: Good afternoon, everybody. My name is Alan Clarke. I am chief executive of Quality Meat Scotland.

George Burgess: Good afternoon. I am George Burgess. I am the head of food and drink at the Scottish Government.

Jonnie Hall: My name is Jonnie Hall. I am director of policy for NFU Scotland.

[The Minister of State, Department for Environment, Food and Rural Affairs (George Eustice)]

Q 174 For decades, the common agricultural policy, with all its prescriptive rules, has applied to every part of the UK. As we leave, each part of the UK will have the freedom to develop a policy that is right for it. Could you each say what it is about the common agricultural policy that you dislike the most, what you most want to change and what type of system you think is appropriate for the modern world?

Jonnie Hall: I am happy to start. I can quote Mr Eustice back at him and say that the CAP has largely “incentivised inertia”—a phrase he has used many times. We agree. The bluntness of area-based payments has not driven innovation or productivity, or indeed delivered on environmental challenges.

In that respect, we see the departure from the EU and from the CAP as an opportunity to develop bespoke agricultural policy tailored to the individual needs of the devolved Administrations. We have some capacity for that already, in the fact that we have four different settlements of pillar 1 and pillar 2 under the CAP, but we are nevertheless constrained by an awful lot of bureaucracy and by the rules and regulations around mapping, inspections, penalties and so on.

It is vital for us to take the opportunity and for Scotland to be allowed, under the devolved nature of agricultural policy development and delivery, to develop its own suite of schemes and measures that fit the needs and profile of Scottish agriculture, which is significantly different from that of the rest of the UK and, in particular, England. That is absolutely right and, therefore, this provides us with an opportunity.

George Burgess: The Scottish Government position, as I am sure all Committee members will know, has not been in favour of Brexit. We believe that continued membership of the single market and customs union is the best way forward on economic, social and environmental grounds. That includes on the common agricultural policy.

Obviously, there will be areas in the common agricultural policy that are not necessarily to our liking. Work has been under way in Scotland, under the “Stability and Simplicity” consultation, to identify, in the short term, any areas where some improvement could be made to the common agricultural policy. That might be around issues such as mapping and penalties, as Mr Hall has mentioned. We are working, through a farming and food production future policy group, to look at longer-term policy in Scotland.

Alan Clarke: I have a couple of points from Quality Meat Scotland. This gives us an opportunity to look outside our normal markets. Currently, 69% of Scottish red meat is being sold in the rest of the UK, outside of Scotland, and 10% goes internationally. It gives us an opportunity to continue to build on that. To do that, protection of our protected geographical indicators is essential.

In addition, we need to have no reduction of standards of any other imports coming into the country, to make sure that we have a level playing field for our food producers. We would like to see transparency of price reporting throughout the supply chain, to enable us to make better decisions across that area. As you will perhaps hear later from me, we have been working closely with the Agriculture and Horticulture Development Board and Hybu Cig Cymru on levy repatriation work. We think there is a lot of work that we could build on across the three nations, if not the four nations.

[George Eustice]

Q When the current design of the CAP was brought in, I remember a lot of concern in Scotland, including from NFU Scotland, farmers and the Government, that area-based payments did not work in such a landscape—that the diversity between the lowlands and the moorlands made it highly problematic for an area-based-only payment to work. Mr Burgess, are you saying that, although you might try to simplify the legacy CAP scheme around the edges, you still think that a basic CAP subsidy on land tenure is the right approach?

George Burgess: The Scottish Government’s approach through the “Stability and Simplicity” consultation is that, for the period from now until 2024, we will essentially retain the features of the current CAP system with some scope for simplification, improvement and piloting. Beyond that, we are open to looking at a more radical reform of the policy. That is the approach we are taking through our future policy group, which includes representatives from the farming industry, food production and environmental groups, so that is the forum for considering the longer-term changes in Scotland. Whether it retains area-based payments or moves to some other system, or a combination of the two, remains to be seen.

Jonnie Hall: I support that, in the sense that area-based payments are far too blunt and do not deliver the objectives that we all aspire to, not only in supporting agricultural incomes and productivity but in addressing challenges such as climate change, biodiversity and so on. The sooner we move to an approach that is more action- based than area-based, the better. However, we are in alignment with the Scottish Government in the sense that from 2021 onwards, we will be venturing into uncharted territory in many ways, given the changes in our operating environment, trading issues and other areas. The ability to retain direct income support that offers some stability in the interim is key. We are absolutely in alignment about change, but the key questions are about the pace of that change and how we manage it.

We note with interest what is happening in England and the Bill’s proposals for phasing out direct support. Of course, that would be inappropriate and inapplicable in a Scottish context, so we need the devolved capacity to do things differently. The direction of travel is very much the same and the landing space is probably the same as well, but we have to consider the pace of that change and recognise the challenges and issues that are particularly pertinent to Scottish agriculture.

[George Eustice]

Q We have set out in this Bill a seven-year transition for England, from 2021 to 2028. I suppose it is possible that the Scottish Government might say, “We will keep the current system with a few minor simplifications until 2024”, but then ditch it overnight and go straight in one leap to a new system. Do you envisage a sharper transition than seven years, or have the Scottish Government made clear that they will definitely not do things faster than seven years?

George Burgess: No, I do not think so. The Agriculture (Retained EU Law and Data) (Scotland) Bill, which implements the stability and simplicity approach for the period between now and 2024, is currently before the Scottish Parliament. I have mentioned the future policy group, which aims to bring forward proposals by the summer of this year. That is the point when we will begin looking at the transition—things that may be piloted between now and 2024—so we are definitely not looking at a sharp cliff-edge transition in 2024.

Hopefully within that time period, we will gain a clearer understanding of our trading regime with Europe and the rest of the world. At the moment, it is frankly quite hard to work out what we should be doing with sectors such as sheepmeat, given that we do not know what the situation with our largest export markets will be.

Jonnie Hall: A number of interests in Scotland have suggested that there should be a sunset clause in the piece of legislation that Mr Burgess has referred to, so that it comes to a definitive end in 2024. However, we would not agree with that, because it would potentially create a cliff edge where we would go off the stability elements that we have talked about and into the unknown. We want to avoid that; we need to be able to adjust to and reflect on the circumstances of the time, and it is right that the Scottish Government have the ability to do so under the legislation that is going through the Scottish Parliament.

[Daniel Zeichner (Cambridge) (Lab)]

Q Good afternoon. I think Mr Clarke alluded to this point briefly earlier, but I will ask all of you, as I have asked most of the witnesses: what effect do you think allowing imports of food produced to lower environmental welfare and health standards will have on Scottish consumers and producers and, most of all, on the Scottish environment?

Alan Clarke: It would be a disaster for the Scottish red meat industry. The Scots were pioneers of quality assurance. Scotland was the first country in the world to set up whole of life, whole of supply chain quality assurance, and that gives a unique selling point to our world-class products of Scotch beef PGI, Scotch lamb PGI and specially selected pork. For any diluted product to come to market and be able to compete directly—as far as I am concerned, that has no place on the supermarket shelves.

George Burgess: I suspect you will find a very large measure of agreement at this table. The Scottish Government are very concerned at the prospect that future trade agreements could allow for a dilution of standards.

Jonnie Hall: It is also worth adding that the produce of Scotland—commodities is the wrong word—is not about, “Stack it high, sell it low.” We are not going to compete on world markets. We are not a volume producer. We are based on the authenticity and the provenance of our product, and the welfare standards and environmental standards behind that. If we expose Scottish agriculture to cheaper imports of substandard production methods and so on, we will blow large sections of Scottish agriculture out of the water. That will have significant impacts on the agricultural industry itself, but also, more importantly, on the wider issues around rural communities and the environment and habitats that Scottish agriculture underpins with its extensive grazing systems and so on.

--- Later in debate ---

[The Chair]

We have until 5pm for evidence from the representative of Which? Welcome. Could you introduce yourself?

Sue Davies: Good afternoon. My name is Sue Davies. I am head of consumer protection and food policy at Which?.

[George Eustice]

Q The Bill sets a different course for the future of agriculture policy, so it will be much more about payment for the delivery of public goods than arbitrary area-based subsidies. Are you generally supportive of that approach? I know there are one or two other things that you think have been missed. Perhaps you could explain what those are to the Committee.

Sue Davies: May I start by saying congratulations on your appointment, Mr Eustice?

We support the public money for public goods approach. We think it is the right way to go, but there is a real opportunity to put more about consumers—the people who will ultimately be eating the food—in the Bill. There is a range of ways in which that could be done. We have a real opportunity to redesign agriculture policy to make sure that we have a much more joined-up approach to food and farming policy in general. We welcome the commitment to the national food strategy, for example, as part of that.

The public money for the public goods that are included is really important, but we would also like to see a stronger focus on other consumer benefits, particularly in relation to food safety, public health and reducing antibiotic resistance. When talking about productivity and increasing food production, we fine that people care so much about food. We have done lots of consumer research over the years. In the last couple of years, we have particularly focused on asking people about food standards.

People expect the UK to have really high standards and that, if anything, we will build on the standards that we have at the moment. We talk about productivity, and we want it done in a way that meets consumer expectations. We would also like to see a more general commitment to upholding high food standards in the Bill.

[George Eustice]

Q To come back to that point, the view we took when drafting the Bill—I am interested in why you take a different view—is that the payment for public goods could involve things such as reduced pesticide use and reduced antibiotic use, because animal health and welfare is in there. By targeting those public goods in some areas, there would be a consequential benefit for public health, because of the nature of the food production.

There is a separate area that is about public health campaigns, healthy eating and food standards, but obviously measures are already in place through the Food Safety Act 1990 and the work that the NHS does to encourage healthy eating. Our view is that we do not want to duplicate work that is already present in other fields and is the responsibility of other Departments.

Sue Davies: I can see that to some extent, but there is a real opportunity to integrate public health much more in farming practices. A good example of that is the work the Food Standards Agency did a couple of years ago to try to reduce campylobacter rates in chickens. We have regulation to some extent around that to try to control the practices that are used, but it was only by incentivising action throughout the supply chain—in that case, by the Food Standards Agency doing a retail survey, where it was, in effect, naming and shaming retailers by showing how campylobacter levels compared—that that led to co-operation across the supply chain to look at what measures could be put in place. That included measures in slaughterhouses as well as a strong on-farm focus, such as looking at biosecurity measures and what happens in relation to thinning.

It is that kind of approach that we feel should be included, and certainly the opportunity to do it should not be excluded. Some things will require regulation, and we definitely think they should be regulated, but it is a mix of using regulation and wider incentives to raise best practice. For issues such as antibiotic use, there is an opportunity to try to incentivise the reduced use of antibiotics again, on top of the legislative requirements that we have.

[George Eustice]

Q There is an animal health provision there, which opens the prospect of healthy livestock accredited schemes that farmers could sign up to, which might be all about reduced antibiotic use or different stocking densities in poultry. That is all possible under the existing powers, so I am trying to get my head around what additional powers you feel are needed over and above the objectives that we have.

Sue Davies: It is certainly really positive that that is in there, but if there are specific measures where the main goal is focused on human health, rather than animal health, that should be included in the Bill. Ultimately, the Bill will determine the types of food choices we have as consumers and the sorts of standards to which our food is produced. Obviously, a lot of other policies will have an impact on that, but we think this is a real opportunity to shape our food system in a positive way that works for consumers as well as farmers. We should not miss these really good opportunities to include that in the Bill at this point.

[Daniel Zeichner]

Q Good afternoon. May I add my congratulations to the new Secretary of State? We obviously do not want to be too nice about him and set him off to a bad start, but he is clearly a popular choice.

Ms Davies, I am bound to ask you the question that I have asked virtually every other witness: from a consumer’s point of view, what would be the impact of allowing imports produced to lower standards? I think I can probably guess the answer, because it has been very consistent across all our witnesses. At the end of the whole chain, particularly with ready meals and so on, do you feel that consumers know enough in the current system? Could we not do more through the Bill to lift standards, particularly on antibiotics and so on?

Sue Davies: I think your food standards question is really important and shows why we need to make sure that we have a joined-up policy. This will have a big impact on the sorts of choices that consumers can make, but if we do not address other policies, particularly trade policy, it could completely undermine all the positive things that we are trying to achieve with the Bill.

As I mentioned, we know from our consumer research that people have really high expectations on food standards. Some 93% of people said they expect that food standards will be maintained, and ideally people think they should be enhanced now that we have left the EU. People do not expect cheaper imports to come in and undercut our producers. People want to support UK producers, particularly of products such as meat and dairy, so the tariff schedule that has come out is interesting. All of that has to be joined up to make sure that we are not trading away our standards and potentially bringing in safety issues, or allowing production methods that we know consumers do not find acceptable.

We saw with the horsemeat scare that food has many different aspects. Some are about safety, and others are cultural—people just do not want to eat food that is produced in certain ways. We have been doing a lot of survey work and we know that around eight in 10 people have concerns about eating hormone-treated beef. A similar number have concerns about food produced using antibiotic growth promoters. Those practices are used in some of the countries with which we will seek to reach trade deals—hormones in the case of the US, Australia and New Zealand. We absolutely have to ensure that trade policy builds on our current standards. If anything, we are looking to improve our standards rather than allow them to deteriorate or accept lower quality imports that will make it very difficult for UK producers to produce to the standards that consumers expect.

We have also asked about labelling issues, because sometimes it is suggested that people can decide if you just label everything. People feel strongly about it and do not think that labelling is the solution. That applies to people across all socioeconomic groups; it is not just better-off customers who can make this sort of choice. We think it is really important that there is something in the Bill that makes it clear that we should maintain and build on our food standards.

We have asked people what they think about labelling, and they generally tell us that they think the labelling information is about right, but when you ask people about where improvements might be made, they talk about things such as helping people to make more sustainable choices and improved animal welfare labelling. There is scope to look at how we can improve that by building on the labelling information that we have already. One area that we know people feel strongly about is the traffic light nutritional labelling system, which we would like to be made mandatory when we have the opportunity to legislate to do so.