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.