Exiting the European Union (Agriculture)
George Eustice Excerpts(4 years, 7 months ago)
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The Minister of State, Department for Environment, Food and Rural Affairs (George Eustice)
I beg to move,
That the draft Common Organisation of the Markets in Agricultural Products (Transitional Arrangements etc.) (Amendment) (EU Exit) Regulations 2019, which were laid before this House on 24 July, be approved.
The shadow Minister, the hon. Member for Stroud (Dr Drew), and a number of other Members may, in the case of this statutory instrument and two others that we will consider this afternoon, have a sense of déjà vu, not for the first time in issues relating to EU exit. I will explain why these further statutory instruments are necessary, but I do not envisage that we will need to take up the full time allocated for them, unless the shadow Minister feels that he did not rehearse these issues in the detail he would have liked to last time. This particular instrument concerns the common organisation of the agricultural markets, more commonly referred to as the CMO in EU parlance. The CMO sits in pillar 1 of the common agricultural policy alongside direct payments, and it was set up as a means of meeting the objectives of the CAP, in particular with regard to stabilising markets, ensuring a fair standard of living for agricultural producers and increasing agricultural productivity.
Mr Jim Cunningham (Coventry South) (Lab)
How does that impact subsidies to farmers, which must affect the markets? Where are we in terms of the continuation of subsidies to stabilise those markets?
George Eustice
Retained EU law means that the existing basic payment scheme will continue. The hon. Gentleman will be aware that the Agriculture Bill, which has been before the House, outlines a plan to evolve that policy over a period of seven years, but that is not the issue before us today. This particular instrument relates to the CMO regulations.
In March this year, six EU exit operability SIs concerning the CMO were debated in the House, approved and made. Those SIs sought to make retained EU law operable in the domestic UK context. The instrument under debate amends one of those existing EU exit SIs: the Common Organisation of the Markets in Agricultural Products and Common Agricultural Policy (Miscellaneous Amendments) (EU Exit) Regulations 2019. The existing SI, which was passed in March, ensured the operability of certain provisions relating to the reserved policy areas of regulation of anti-competitive practices, international trade, imports and exports and intellectual property law. Among other things, it establishes transitional periods for the import documentation for hops, certificates of conformity for fruit and vegetables and imports of veal.
The original statutory instrument obviously envisaged a departure date of the end of March, but, as Members are fully aware, a decision was taken to delay our departure to 31 October. The primary aim of this statutory instrument is to make simple corrections to the existing EU exit SI, to ensure that, where provisions refer to a transitional period, those periods are realised as was intended.
Current EU legislation requires hops imported from third countries to be accompanied by an attestation certifying compliance with EU marketing standards. For fruit and vegetables, EU legislation permits the inspection authorities of specified third countries to certify that imports originating from that country comply with EU marketing standards, so that they may benefit from lower inspection burdens in the EU. That legislation will be rolled over into UK law, and we are providing for a transitional period of two years for forms and certificates that we accept from third countries attesting that a product meets marketing standard requirements, during which both the new UK forms and certificates and their equivalent EU versions shall be accepted, provided that the EU standards remain at least as high as the UK standards. That will allow importers time to transition to using the new forms of documentation.
This instrument also concerns imports of veal. Under EU law, third countries wishing to import bovine meat into the EU must maintain an identification and registration system of the bovine animals they intend to import, starting from the day of birth of the animals. This is to ensure that imported meat has traceable origins and meets the EU’s standards and that the age of animals whose meat is marketed as veal can be verified. The name and address of the body in charge of the system, with a list of operators for whom the body is carrying out checks, must be notified to the Commission before the first consignment of veal is imported.
These rules are being retained in our own EU exit SIs, with a requirement for third countries—including EU member states, which will become third countries when we exit—to notify this information to the Secretary of State. To safeguard the continuity of veal imports from the EU into the UK after EU exit, we have allowed a three-month transitional period, to allow the EU time to gather and submit the required information to the UK. The end dates for these transitional periods were explicitly stated as 29 March 2021 for hops and fruit and vegetables and 30 June 2019 for veal.
Toby Perkins (Chesterfield) (Lab)
It is important that the standards are maintained as we head towards 31 October, and many of my constituents will be concerned about not only the maintenance of those standards but also pricing. Can the Minister clarify the Government’s policy on what tariffs the UK would place on EU agricultural goods coming into the UK if, in the event of no deal, the EU placed tariffs on UK agricultural goods?
George Eustice
The hon. Gentleman raises a point that is somewhat outside the scope of these regulations—
Madam Deputy Speaker (Dame Eleanor Laing)
Order. For clarity, it is totally outwith the scope, and we must remain within the scope.
George Eustice
Thank you, Madam Deputy Speaker.
As I was saying, the end dates of these transitional periods were explicitly stated as 29 March 2021 for hops and fruit and vegetables and 30 June 2019 for veal. However, the extension of article 50 to 31 October would render those transitional periods significantly shorter, or in the case of imports of veal, completely redundant. This statutory instrument preserves the original transition period that was intended.
The instrument makes further amendments to the Common Organisation of the Markets in Agricultural Products and Common Agricultural Policy (Miscellaneous Amendments) (EU Exit) Regulations 2019 in order to correct inconsistencies in the drafting and minor inoperabilities. The instrument under debate relates to reserved policy areas. However, the Department for Environment, Food and Rural Affairs has engaged the devolved Administrations on its approach to CAP legislation under the European Union (Withdrawal) Act 2018, including on this instrument, to familiarise them with the legislation ahead of laying it. I commend these regulations to the House.
George Eustice
The hon. Member for Edinburgh North and Leith (Deidre Brock) seemed to criticise the fact that we have these four SIs before us this afternoon and indicated she felt it might be a way of filling time. But I thought she and all the Opposition parties wanted to be here to scrutinise issues relating to EU exit and that is exactly what we are doing this afternoon. However, I share her commendation to our civil servants. The teams who have been working on this and all other SIs have worked incredibly hard over many months.
I want to address the point made by my right hon. Friend the Member for Wokingham (John Redwood). I think that he and I are not as far apart as he suggested in his contribution. He will probably recall that I resigned from the last Government on 28 February precisely because I did not believe it was right to extend article 50 and delay—I believed that that would lead to a sequence of events culminating in something of a muddle and the need to do exactly the types of things we are doing now.
My right hon. Friend must not confuse the transitional arrangements that we have discussed in relation to this SI with the rather oddly named implementation period in the withdrawal agreement that he will be familiar with. I will give him one example of the type of thing the SI provides for. Currently, it is possible, under EU law, for the EU to recognise certification authorities in New Zealand, so that people can certify that apples they are exporting from New Zealand to the UK meet our standards. That reduces the need for us to carry out automatic checks on those apples when they arrive at a UK port. All the SI does is enable those existing certifications to carry on for that period of two years, giving people time to continue to trade—I know he is a great supporter of free trade, particularly with our Commonwealth friends—in that two-year period without having to apply for a new UK certificate.
I turn now to the points made by the shadow Ministers. On those made by the hon. Member for Stroud (Dr Drew), in general, the primary purpose of the SI is to extend the transitional periods to reflect the fact that the departure date has moved from the end of March to 31 October. That is the primary purpose, but as I said there are one or two other areas where there were very minor mistakes. He asked for some examples. In one case, the term “appropriate authority” was used, when it is clear it is a reserved matter, so we should have used the term “Secretary of State”. It is a minor error. The legislation as drafted probably would have worked but, given that we were revisiting this anyway to change the transitional periods, it seemed a good opportunity to put that other error right.
The hon. Gentleman raised the issue of olives, olive oil, silk worms and tobacco. It would not have been the end of the world if that had remained in the SI but, again, given that we needed to return to change the transitional periods, it seemed a matter of good housekeeping to remove those references where they were not appropriate. We would never have to recognise a producer organisation for the purposes of those sectors since we do not produce olives, olive oil, silk worms or tobacco, and as the hon. Member for Ipswich (Sandy Martin) pointed out, there is very little prospect of us doing so. In earlier SIs, we deleted similar provisions for home-grown UK bananas, because on a similar analysis we decided that was unlikely in the foreseeable future. This simply follows the same logic in those additional areas.
The hon. Member for Stroud raised several other issues about the Agriculture Bill and pointed out that I had tabled many amendments. Indeed, I made great use of my freedom as a Back Bencher to table some amendments. He will be aware, however, that now I am back at the Dispatch Box, I agree with collective Government and support a collective Government position. That is why those amendments have mysteriously disappeared.
The hon. Gentleman raised the issue of marketing standards and asked whether we have the enforcement capabilities for that. I can confirm that we have. We have Her Majesty’s marketing inspectorate, which sits within the Rural Payments Agency and which already does all the work involving marketing standards on behalf of the European Union, and the UK had its own horticultural marketing inspectorate well before we even joined the European Union.
On the issue raised by the hon. Member for Ipswich, a number of statutory instruments that are currently before the House have undergone a sifting process to correct minor errors but in general to ensure that the SIs that were laid before March remain relevant for a 31 October departure date. He is, of course, aware that the European Union (Withdrawal) Act provides for subsequent SIs after we have left, if it is simply a question of correcting minor errors of the sort that I have mentioned today. He will also be aware that there is provision for an emergency procedure should that be necessary.
I hope that I have managed to address most of the points that have been raised. I commend the regulations to the House.
Question put and agreed to.
Resolved,
That the draft Common Organisation of the Markets in Agricultural Products (Transitional Arrangements etc.) (Amendment) (EU Exit) Regulations 2019, which were laid before this House on 24 July, be approved.
Exiting the European Union (Agriculture)
George Eustice Excerpts(4 years, 7 months ago)
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The Minister of State, Department for Environment, Food and Rural Affairs (George Eustice)
I beg to move,
That the draft Common Agricultural Policy and Common Organisation of the Markets in Agricultural Products (Miscellaneous Amendments) (EU Exit) Regulations 2019, which were laid before this House on 24 July, be approved.
This statutory instrument concerns the common organisation of the agriculture markets, more commonly referred to as the CMO. As I said earlier, in March this year six EU exit operability SIs concerning the CMO were debated in the House, approved and made. They applied operability amendments to retained EU regulations which set out the overarching framework for the CMO and the detailed rules contained therein. This instrument amends some of the existing SIs to make simple corrections ensuring that when provisions refer to a transitional period, in common with the previous SI, it can be realised as intended, notwithstanding the delaying of EU exit until 31 October.
Five different transitional periods are set out in the existing EU exit SIs. The first and second concern special provisions for the import of wine and the labelling of imported wine. Under EU law, third countries wishing to import wine into the EU must produce it in accordance with specified oenological practices, and are required to provide key information on the content of the shipment, including a certificate evidencing compliance with EU rules and an analysis report. Those rules are being retained through retained EU law, but we are only retaining oenological practices that relate to domestic wine production.
We are also amending wine labelling rules to make them more appropriate for the UK market. For example, we are requiring certain information to be written in English whether or not it also appears in another language. However, we are providing for a transitional period of 21 months, consistent with that in other labelling provisions, during which wine that is labelled in accordance with current rules and produced in accordance with oenological practices authorised under EU law may be imported into the UK for marketing to ensure that there is no disruption to the import of wine from the EU. During that period, we will also accept EU forms and certificates from third countries alongside the new UK certificates.
The third and fourth transitional periods concern labelling for packages of fruit and vegetables, and for beef and veal. To ensure that consumers are not misled, for some products labelling changes are required primarily as a result of our no longer being a member of the EU. The terms “EU” and “non-EU” will be removed as options for describing the origin of the products, and pre-packaged fruit and vegetables will need to be labelled with the name and address of a UK seller after we leave the EU, rather than the information about an EU seller. We have introduced a transitional period of 21 months to mitigate the effects of these labelling changes on business.
The final transition period concerns import documentation for hops. Current EU legislation requires hops imported from third countries to be accompanied by an attestation certifying compliance with EU marketing standards. We are rolling over this legislation into UK law and providing for a transitional period of two years for documents that we accept from third countries, including the EU—which is about to become a third country—attesting that imported hops meet marketing standards requirements. During those two years both the new UK forms and certificates and the EU versions can be accepted, provided that the EU’s standards remain at least as high as those in the UK. This will allow importers time to transition to using the new forms of documentation, while ensuring that we accept only produce that is assured to meet UK standards.
In the original SIs, in common with the previous one we debated, the end dates of the transitional periods are explicitly stated as a specific date. For example, a transitional period lasting two years is expressed as a
“transitional period ending 29th March 2021”.
However, the extension of article 50 to 31 October means that we need to change the legislation to ensure that the intended period of transition remains in place. Therefore, the instrument under debate now makes a simple amendment to the existing EU Exit operability SIs so that the transitional periods apply for the duration intended.
The instrument also makes minor amendments to a series of other domestic EU exit SIs relating to marketing standards, the horizontal CAP legislation and the rural development programmes in order to remove ambiguity and inconsistencies, or to simply correct typographical errors. This instrument relates to areas of devolved competence. I can assure the House that we have consulted extensively with the devolved Administrations on its content and have received their consent to lay the SI. I therefore commend these regulations to the House.
George Eustice
We rehearsed plenty of issues when we debated the previous statutory instrument, so I can be briefer, and I appreciate that both hon. Members who spoke have done so briefly.
The hon. Member for Stroud (Dr Drew), the Labour shadow Minister, asked who would do this work. The office for environmental protection, which will obviously be a matter for the new environmental Bill, would not do any such work. We are talking here, probably, about marketing standards and labelling standards, and the Rural Payments Agency has an inspectorate that leads on that work; it always has done, and has done so incredibly well.
The hon. Gentleman should recognise that the European Union does not have a directly employed army of inspectors in UK ports; the EU has a body of law, but UK agencies already do all such work. As he said, not only does the RPA monitor marketing standards, but there are other organisations as well. We have organisations that monitor pesticide residues; we have the FSA, which deals with food safety issues; we have organisations such as the Food and Environment Research Agency, which deals with plant health, and the Animal and Plant Health Agency, which deals with animal health. The technical expertise is already here in the UK, in our agencies; indeed, that technical expertise is often relied upon by the EU, not the other way round.
Dr Drew
I accept that; many of our good people currently work for the EU. But is the Minister seriously suggesting that those people have carried out proper contingency planning on how they will do this monitoring in a month’s time? How would FERA—how would the RPA, which I have significant doubts about; I do not know how many scientists it actually employs—sit down and do the work to see whether what has been imported is what it says on the label?
George Eustice
The regulations provide for a transitional period, precisely to give people time to adjust. We will be saying to European wine exporters that they do not, on day one, have to apply for a UK certificate, or get UK certification. We are saying, very generously—it is not being reciprocated particularly yet—to the European Union that because we want to prioritise continuity in the short term while people adjust to this new situation, we will recognise their existing certification.
To answer the hon. Gentleman’s question, there are no risks and nothing new is going to happen that has not already been happening under EU law for a number of years. This simply creates that transitional space to avoid UK authorities having to do unnecessary administration in the short term, and to avoid exporters having to go through unnecessary administration in order to continue to trade.
Dr Drew
The Minister is being very generous in giving way. What then is to stop people labelling their cheap plonk as burgundy and sending it in the form in which they send their good stuff? How will we be able to tell that what we are getting is what it says on the label? I am really intrigued by this.
George Eustice
Well, as the hon. Gentleman will be aware, there is nothing to stop that happening now, apart from EU law. For 45 years we have relied on EU law being enforced in member states. We are simply saying that in the transitional period we anticipate that the EU will continue to abide by and enforce its own laws. If it becomes apparent that it no longer enforces its own laws, we have the powers in these measures to cease to recognise them, because we will maintain our standards.
In answer to the hon. Member for Edinburgh North and Leith (Deidre Brock), I can confirm that there are two slightly separate provisions on wine. First, we are bringing across only those provisions that relate specifically to wines that we produce in the UK, in relation to the production side. We have a growing and very successful wine industry, particularly in sparkling wines. We will not be bringing across those provisions for wines that we do not produce in this country and that are made in other countries. Secondly, we are making those labelling transitional provisions available to all EU producers so that there will be no short-term interruption in the administration procedures that they have to follow.
I hope that I have addressed the points raised by the shadow Minister and the hon. Member for Edinburgh North and Leith. I commend the regulations to the House.
Question put and agreed to.
Exiting the European Union (Agriculture)
George Eustice Excerpts(4 years, 7 months ago)
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The Minister of State, Department for Environment, Food and Rural Affairs (George Eustice)
I beg to move,
That the draft Import and Export Licences (Amendment etc.) (EU Exit) Regulations 2019, which were laid before this House on 23 July, be approved.
The purpose of this statutory instrument is to make changes to EU regulations governing the agricultural import and export licensing regime to ensure that they remain operable on our departure from the European Union. The instrument also revokes some obsolete and redundant regulations relating to the payment of export refunds in the dairy sector and on the administration of EU third country export quotas for cheese and skimmed milk powder.
I should point out that this instrument is rather different from the other three we are considering this afternoon, in that it does not relate to changes that are necessary due to transitional arrangements or dates. This is one of a small number of very minor SIs that were deprioritised in the run-up to the end of March, given that their applicability to the UK is quite limited and they were not judged to be sufficiently important to merit passing in time for the end of March. However, now that we have the luxury of time, it is possible to bring them forward.
This instrument seeks to make EU regulations governing the agricultural import and export licensing regime operable. In particular, the regulations make operability fixes to technical EU Commission regulations, providing for the issue of import and export licences for certain agricultural products; update EU regulatory cross-references to equivalent provisions in domestic legislation made under the Taxation (Cross-border Trade) Act 2018; and convert licence securities from euro values into sterling using the average annual exchange rate for 2018.
EU Commission regulations 2016/1237 and 2016/1239 provide for a licence system for the import and export of certain agricultural products and specific provisions for the import of hemp. Under those regulations, it is required that any import of husked, milled or broken rice, raw hemp and hemp seed or ethyl alcohol be subject to an import licence. Likewise, any export of husked or milled rice is subject to an export licence. The regulations also provide for specific provisions in relation to hemp seed imports other than for sowing, including the pre-registration of importers and requirements to prove the destination of goods.
The purpose of those common agricultural policy licences is primarily to provide a means of monitoring agricultural markets by having advance notice of goods entering and leaving the EU. However, given improvements in data collection at the border, the Commission has increasingly relied on real-time customs data as a means of monitoring markets, which has negated the need for licences. They are now limited to just a handful of products, for specific reason. That is why these measures are of declining importance and were not prioritised for passing by the end of March.
For example, rice import licences really serve only as a means of applying the EU’s variable import duty system, and hemp licences have been retained at the request of the directorate-general for migration and home affairs, apparently to support EU drug policy, even though the information provided does not really contribute to that effort. This statutory instrument specifically amends Commission delegated regulation EU 2016/1237 and Commission implementing regulation EU 2016/1239, both passed on 18 May 2016, by replacing references to the EU with references to the UK and references to the EU Commission with references to the relevant UK authority. It replaces EU regulatory cross-references with references to equivalent provisions in domestic legislation already made under the Taxation (Cross-border Trade) Act 2018 and converts licence securities from euro values into sterling using the average annual exchange rate for 2018.
EU Commission regulation 1187/2009 sets out detailed rules for the provision of export licences and export refunds in the dairy sector.
Sir Greg Knight (East Yorkshire) (Con)
Can the Minister confirm whether the cost of administering these licences is counterbalanced by the licence fees that are paid?
George Eustice
My right hon. Friend will be aware that we have always had a clear principle in this country of aiming for full cost recovery on licences, and these licences tend to be focused on very large traders and importers.
The provisions relating to the payment of export refunds are now obsolete, as they relate to rules that existed before the entry into force of the current common market organisation regulation. Under current rules, export refunds can be paid only in the context of crisis measures. The provisions covering export licences relate to the management of EU-World Trade Organisation third country export quotas of cheese to the United States of America and Canada, and of skimmed milk powder to the Dominican Republic, under the economic partnership with the CARIFORUM states. UK access to those export quotas once we leave the EU is obviously uncertain, since we will no longer be an EU member, although negotiations with those countries over future tariff rate quotas are ongoing. The Government will bring forward new legislation to manage any future UK access to third country quotas should that be necessary in the future. As the regulations in question are effectively obsolete or redundant in a UK context, this statutory instrument revokes Commission regulation 1187/2009, of 27 November 2009.
This statutory instrument concerns only reserved areas of competence regarding import and export controls, but the Department for Environment, Food and Rural Affairs has engaged with the devolved Administrations on its approach to CAP legislation under the European Union (Withdrawal) Act 2018, including this instrument, to familiarise them with the legislation ahead of its being laid. I therefore commend the regulations to the House.
George Eustice
Let me turn first to the points made by the shadow Minister. He highlighted the use in the explanatory memorandum of the term “fixes”, which he even put in quotes marks. In DEFRA, we like to fix things that are broken, and the truth is that in this case, as in many other cases, it was always recognised that simply to bring across retained EU law would require changes for the purposes of operability. The types of fixes that are commonplace throughout this instrument and all the others simply replace the words “European Union” with “UK” or replace the European Commission as the competent authority with the relevant authority in the UK or with the Secretary of State.
The shadow Minister mentioned the issue of export refunds for dairy, which links to a point that was made by the hon. Member for Strangford (Jim Shannon). Let me say that, when it comes to these export refunds, we are simply deleting provisions that have already disappeared from EU law, so we are revoking something that became redundant and obsolete anyway under EU law in—I think—2007.
EU thinking on export refunds has evolved in recent years. There is a general consensus that they can be used only in extreme circumstances—when there is a particular crisis—and there are other provisions in law to enable that to happen. Therefore, they would not be able to be used anyway, because the other associated legislation that would enable us to do that does not exist, so this measure is really little more than a good housekeeping measure.
The point raised by the hon. Member for Strangford goes somewhat beyond the scope of the measure, but I will touch on it briefly. Let me reassure him that the Government are absolutely fully aware of the problems that the Northern Ireland dairy industry in particular could experience in a no-deal scenario. It is the case that it exports around 30% of its liquid milk to be processed in Ireland. That would be a problem if there were a requirement for export health certificates, or, indeed, if full tariffs were applied. It would also be a problem for those cheese processers in the Irish Republic, who would no longer have their supply of milk. Obviously, we hope that this is something that can be resolved through negotiation, but I can reassure him that we are working very closely with DAERA in Northern Ireland to identify all sorts of contingency arrangements and interventions that we would instigate if they were required.
Jim Shannon
I thank the Minister for that explanation and for all the hard work that he does in his Department. It is good to see him in his place doing things that he did in the past and doing them well. It is important that the Republic of Ireland is aware very clearly of the benefits of having a good working relationship with Northern Ireland in the United Kingdom. It is for the mutual benefit of everyone: for the mutual benefit of the other producers; for the mutual benefit of the factories; and for the mutual benefit of the workers.
George Eustice
I could not agree more. There is a mutual interest for all EU members and the UK to reach a sensible resolution to the current discussions. That is why the Government are redoubling their efforts to try to get a sensible withdrawal agreement with that backstop deleted and alternative arrangements put in place instead.
I turn now to the point raised by the hon. Member for Edinburgh North and Leith (Deidre Brock), which also links to a point raised by my right hon. Friend the Member for East Yorkshire (Sir Greg Knight). I am aware that my right hon. Friend has raised with me this issue of cost recovery and charges in a different context, which I am looking into. However, in this particular context, I can confirm that it is licence security that is offered, and it is returned once a licence is utilised within the specified criteria. There are no costs to operators if they use the licence as specified and therefore no economic implications. The hon. Lady should be aware that the impact assessment highlights the fact that any costs would be well below the threshold of £5 million, but I hope that, in this additional information, we are talking here about a licence security that is returned. She must also bear in mind that we are doing nothing that is not already currently done. As I know that she and others would ideally like us to remain in the European Union, she would face those costs anyway. We would be forced to have those costs and would never have the chance to be able to repeal them should she want to. We, at least, as a country about to become a properly independent, self-governing country again, would have the opportunity, at a future date, if we felt it necessary, to repeal these particular provisions and save everybody the bother.
I hope that I have been able to address the points that have been raised, and I commend these regulations.
Question put and agreed to.
Exiting the European Union (Pesticides)
George Eustice Excerpts(4 years, 7 months ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
The Minister of State, Department for Environment, Food and Rural Affairs (George Eustice)
I beg to move,
That the draft Pesticides (Amendment) (EU Exit) Regulations 2019, which were laid before this House on 17 July, be approved.
Plant protection products, or “pesticides” as they are commonly called, are currently regulated by means of two European Union regulations: Regulation (EC) 1107/2009, which concerns the placing of plant protection products on the market, including the approval of active substances, authorisation of pesticide products and management of associated risks; and Regulation (EC) 396/2005, which sets maximum residue levels of pesticides in or on food and feed of plant and animal origin, and measures to ensure compliance with those limits.
Earlier this year, two EU exit statutory instruments were laid before this House to convert those EU regulations into operable national law: the Plant Protection Products (Miscellaneous Amendments) (EU Exit) Regulations 2019; and the Pesticides (Maximum Residue Levels) (Amendment etc.) (EU Exit) Regulations 2019. Those two EU exit statutory instruments, in common with many others, made the EU regulations operable in a national context by, for example, transferring functions from EU institutions to national authorities.
This further instrument, which we are considering today, is comparatively minor and simply takes forward some additional amendments that are required to ensure that the regime can continue to operate effectively. First, in common with two of the other SIs that we have considered today, the change in exit day from 29 March to 31 October necessitates that we amend certain dates in the retained law that were based on the original date for EU exit. Secondly, further new EU legislation has come into force during the extension period, after the plant protection products and the maximum residue levels EU exit SIs were finalised. The new EU legislation needs to be corrected following the same approach as in the other SIs. Finally, this instrument fixes some errors within those earlier EU exit instruments, which I will cover later.
Sir Greg Knight (East Yorkshire) (Con)
For the avoidance of any doubt, will the Minister confirm that there is no measurable impact on business as a result of the regulations?
George Eustice
Yes, I can confirm that, in the sense that all the draft regulations are about continuity—an approach to ensure simply that where authorisations are carried out and decisions made by the European Commission, they will in future be made by the Secretary of State or the relevant authority.
Some amendments are required as a consequence of the change in our departure date. The plant protection products EU exit SI in particular contains a number of transitional measures that apply until specified dates. Those dates have been updated in common with the approach in other SIs. Given that exit day is now 31 October, those transitional provisions would allow much less time to adjust than was originally intended. This instrument therefore replaces dates that were calculated from the original exit date with a specified period of time after exit.
The draft regulations also deal with new EU legislation that has come into force since the original EU exit SIs were produced. The plant protection products and the maximum residue levels EU exit SIs converted active substance and MRL regulations into a new national register to give effect to the provisions in a national context. The EU regulations themselves were no longer required and therefore revoked. This instrument deals with new EU regulations that have come into force since then, and we have taken the same approach. Some outdated EU regulations have also been superseded or replaced, and those have now been identified as redundant, so they can be revoked.
This instrument also contains transitional provisions relating to grace periods for the withdrawal of active substances under EU regulations, so that they are carried across unchanged into our national law. Finally, this instrument also fixes a number of technical errors that were made in the earlier EU exit instruments. The vast majority of those were very minor in nature. However, I should draw attention to the fact that it came to light that the earlier plant protection products EU exit SI erroneously removed some provisions on endocrine disrupting chemicals. That omission was purely unintentional and this instrument therefore corrects that error.
Kerry McCarthy (Bristol East) (Lab)
I am glad that the Minister has admitted that this error took place, but the Department has had to bring forward about 80 or so SIs over the summer. Has it conducted a review to ensure that similar errors have not been made in other legislation or are we are going to see a repeat of this situation, with other last-minute amendments?
George Eustice
Well, a point was made earlier that this has been an extraordinarily huge task of converting a highly complex body of EU law across into national law. When the EU (Withdrawal) Act 2018 was passed, it was even envisaged that there may be circumstances where there were errors, omissions or oversights. The hon. Lady will be aware that that Act makes provision for SIs to continue to be made in the event of errors occurring. I deal closely with the team of civil servants who have been working on this legislation, so I know that they have a huge amount of technical knowledge and have drafted the instruments we have been discussing today to the best of their ability to ensure that they have covered everything. But there can be difficulties if a last-minute update contained in particular EU document that is needed to make a particular element of EU law operable is not noticed; sometimes these things will come to light. The important thing is that we are clear about what we are trying to achieve, which is continuity, and that we put things right when they arise.
This instrument was originally submitted under the negative resolution procedure. We subsequently accepted a recommendation from the House of Commons sifting Committee that it be upgraded to the affirmative procedure and debated in the Chamber today on the basis that it includes a provision that relates to the charging of fees. In practice, this measure simply removes a redundant EU provision that clarified that member states could charge. The instrument does not change the existing fees and charges relating to the pesticides regulatory regime, nor does it have any effect whatever on the UK’s future ability to charge fees or make changes to the current fees. That relates to the point made by my right hon. Friend the Member for East Yorkshire (Sir Greg Knight), who I know is very concerned about these issues, but I hope that I have assured him that this changes nothing about the existing charging regime.
We have worked closely with the devolved Administrations —as we have on all the other measures we have discussed today—to develop this instrument, and they have consented to it being made on a UK-wide basis. I therefore commend it to the House.
George Eustice
On the final point raised by the hon. Member for Ipswich (Sandy Martin), I addressed the issue of errors previously. Bringing across these statutory instruments is a vast undertaking; it is inevitable that there will be a few errors, and the European Union (Withdrawal) Act 2018 made provision to deal with those even after exit. I explained very clearly that there was a simple oversight in the case of endocrine disruptors in that particular statutory instrument.
I want predominantly to address the issue of oversight, which was the principal concern raised by both the shadow Minister, the hon. Member for Stroud (Dr Drew), and the hon. Member for Edinburgh North and Leith (Deidre Brock). It is important to recognise that the UK has always been recognised as the leading country in the European Union for chemicals and pesticides expertise. The chemicals regulation division within HSE is the driving force behind most of the EU working groups that consider issues with pesticides. Through those working groups, we provide our technical expertise to the European Union; it benefits from our technical input. Yes, there is a role as well for the European Food Safety Authority and the European Chemicals Agency, but we should not underestimate the incredible technological and technical expertise we have in this field.
In addition to the CRD, which sits within the Health and Safety Executive, we benefit from advice from the expert committee on pesticides, which is a panel of leading academics with knowledge in this area. We also have an expert committee on pesticide residues, which assesses all the evidence on both imported and home-grown foods to look for trends in breaches of maximum residue limits. When we leave the European Union, all the existing methodologies for assessing pesticides at a European level will be brought across, including the so-called end points—that is, the thresholds that are applied—and the precautionary approach. Indeed, the key regulation, 1107/2009, was largely drafted by British officials based in the CRD. So we will be bringing all that across in the first instance.
The idea that there will no longer be technical or scientific assessments is a misunderstanding. I am told that, in the vast majority of cases, where “shall” is specified in the EU regulations in the context of requiring scientific input, it remains as “shall” in the UK ones. I think there are one or two minor areas that do not relate to the requirement for scientific input but relate more, as I understand it, to the methodology and the requirements on particular organisations or bodies. There, it is not appropriate to convert “shall” in the same way, as we do not have to have exactly the same institutions and organisational structure that the European Union has to carry out those effective scientific assessments. However, I reassure hon. Members that we will continue to have scientific assessments, that science will continue to lead all our decisions on pesticides in future and that we have some of the best technical expertise in this field. I hope that I have been able to provide reassurance on that point. Obviously, the main purpose of this particular statutory instrument is to change the dates for the transition.
Question put and agreed to.
Sheep Farming: No-deal EU Exit
George Eustice Excerpts(4 years, 8 months ago)
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The Minister of State, Department for Environment, Food and Rural Affairs (George Eustice)
I congratulate the hon. Member for Darlington (Jenny Chapman) on securing this important debate on a day when we have already had a lot of discussion about our EU exit. She has raised this issue in a series of parliamentary questions, and a little later I will address some of the concerns and issues she raises.
The UK sheep sector is incredibly large and important. Combined, our upland and lowland sheep production had an annual production value of around £1.26 billion in 2018, accounting for around 4.5% of all agriculture output in the UK. As a number of hon. Members have said, the sector is also responsible for some of the most iconic landscapes in the UK.
There are 16 million breeding ewes and some 70,000 sheep farms across the UK, and the sector is particularly important in some of the devolved regions. For instance, around 50% of UK sheep production and the national flock is in Wales and Scotland. The UK is the largest producer of sheepmeat in the EU, producing around 38% of all the sheepmeat and goatmeat produced in the EU last year. The UK is also the world’s third largest exporter of sheepmeat, behind New Zealand and Australia, so we are a truly global player in this sector.
Around a third of our annual production of lamb is exported, and as the hon. Member for Darlington said, over 95% of it goes to the European Union. Total lamb exports in 2018 were valued at around £384 million, with a large amount of that coming from the European Union. The main export destination for lamb in 2018 was France, followed by Germany and Belgium, but for certain parts of the industry, notably those in Wales that tend to produce smaller lambs, some of the Mediterranean countries such as Italy and Portugal are also important purchasers of our goods. Some of our heavier lamb, predominantly from lowland areas, is more sought after in northern Europe. We recognise that, because of all those factors, in the event of a no-deal exit the sheep sector is the most exposed in its trading relationship with the EU, and we have always acknowledged that.
In managing those risks, we have two important factors going for us. First, we have a large domestic market for food in general and for lamb in particular. Measured by import value, the UK is the world’s third largest market for food and drink, coming after only China and Japan, so there are many opportunities for import substitution, as we currently source a significant quantity of lamb from New Zealand.
Secondly, we have an independent exchange rate—an independent currency and a floating exchange rate. That is incredibly important for the agriculture sector. It helps as an automatic stabiliser when we have shocks. We now contemplate the prospect of having to leave the EU without a withdrawal agreement, although that is not our preference, as all hon. Members know. Having a floating exchange rate makes that easier for the farming sector than it would have been had we become trapped in the euro some years ago.
Helen Goodman
I am astounded by what the Minister has just said. The pound has fallen by 20% since the referendum, which means that for every export the farmers are getting 20% less money. How can that be good for them?
George Eustice
The hon. Lady has it the wrong way round, as it is always the case that for sectors that are producing goods, such as agriculture, a weaker exchange rate against the euro leads to higher prices. It is no secret that since the referendum result in 2016, when there was an adjustment of sterling against the euro, agriculture commodity prices in the UK have been at highs, and that has helped farm incomes. That is a recognised fact; exchange rates are a key driver of agriculture commodity prices.
We recognise that even with those important factors going in our favour, the sector is still exposed. Some modelling has been done by a number of different organisations, including the NFU. It is important to recognise that tariffs are a tax on consumers first and foremost. Some estimates therefore anticipate that were the EU to apply full most favoured nation tariffs on lamb, there would likely be an increase in consumer prices in the EU of up to about 20%. That reflects the fact that the UK is the dominant lamb producer in the EU and there are limited other options for it to source its lamb from.
Gareth Snell (Stoke-on-Trent Central) (Lab/Co-op)
The Minister mentions choosing to apply MFN tariffs. I profess not to be an expert on the sheep industry, but in the ceramics industry we have been told that there is no choice over MFN and it is the tariff that has to be applied to abide by World Trade Organisation rules. Is the Minister now saying from the Dispatch Box that the Government can apply discretion on that? If so, will he outline what that plan is?
George Eustice
Yes, absolutely, there is discretion, and the UK Government have already indicated what our tariff schedule would be in a no-deal scenario. Governments have the opportunity to have a lower applied tariff—lower than the bound tariff set in the WTO. The option is also open to any Government unilaterally to suspend tariffs. Indeed, should it wish, tariff suspension would be open to the EU, which I think is unlikely. Alternatively, and more likely, is the creation of an autonomous tariff rate quota for lamb that would be open to the whole world, including the UK. There are many options that both the EU and the British Government have unilaterally to apply tariffs that are lower than the WTO bound tariff.
However, as I said, it is important to recognise that we are the dominant producer. The EU could source more product from New Zealand, provided it had access to the ceiling currently set under the EU tariff rate quota. In the medium term, countries such as Spain could increase their production, but they are unlikely to be able to do that in the short term. For those reasons, it is likely that there would be an increase in consumer prices in the European Union as a result of its applying the full MFN tariff.
It is important to recognise that that increase in price would dampen demand in the European Union. Modelling suggests that that would increase supply in the domestic market and that as a result prices in the UK could fall by up to 30%. To put that into context, that means prices going back down to roughly where they were in 2015, which was a difficult year for the sheep sector. We are talking about a significant potential reduction, but it is not unprecedented. It would simply be going back to levels prior to the referendum result.
Tonia Antoniazzi
The Welsh Affairs Committee recently went to New Zealand and visited the sheep and beef industry, which was very interesting. Our farmers worry that our markets are going to be flooded with cheap New Zealand lamb. What can the Minister say to allay our farmers’ fears?
George Eustice
The Government have already made it clear that because of the particular sensitivity, we will apply full MFN tariffs on lamb, so there will not be any additional imports to the UK beyond those we already have. There is a splitting of the existing TRQ for New Zealand lamb between the UK and New Zealand—a combined total of around 250,000 tonnes—but there will be no additional lamb because we will apply full MFN tariffs outside that TRQ.
Tonia Antoniazzi
How is the tariff going to work between Europe and the UK? Has it been decided what percentage of the tariff is going to go to the UK or to Europe?
George Eustice
Yes, that has been decided. One of the few areas in which the European Union has from the very beginning being willing to work with the UK is on agreeing a splitting of the tariff rate quota schedules, and those have already been lodged with the World Trade Organisation.
As I said, we recognise that in a no-deal scenario we will have to show some solidarity with the sector, which will nevertheless face potentially significant falls in prices to levels not seen since 2015.
Douglas Ross (Moray) (Con)
I welcome the Minister back to the Dispatch Box. He is giving a strong account for this important sector. On my summer surgery tour, farmers from Tomintoul to Rothiemay expressed their concerns about the future of the industry. What reassurance can the Minister give, on behalf of the Government, that this issue is being given the utmost priority? What can he say tonight to reassure sheep farmers in Moray, across Scotland and throughout the UK?
George Eustice
I can absolutely give my hon. Friend that reassurance. He will be aware that the Government are seeking a free trade agreement with the European Union in the medium to long term and, if we can get it, in the short term. In the short term, the Prime Minister has already made it clear that in the event of a no-deal exit we will show solidarity with the sheep industry and make interventions, where necessary, to support farmers’ incomes.
George Eustice
I am going to conclude because we are running out of time.
The hon. Member for Bishop Auckland (Helen Goodman) raised the important issue of whether we have the legal vires to make those interventions, and I can confirm that we do. The Government have a number of legislative vehicles with which to do so, including elements of retained EU law, and the Natural Environment and Rural Communities Act 2006 also includes general grant-making powers that give us the ability to do so. We are considering two possible options. One is a headage payment on breeding ewes, should that be necessary. That would be important in the event that farmers producing lambs are the ones who have the shock to their income. The second option would be something called a slaughterhouse premium, which would in effect involve a supplementary top-up payment for lambs at the point of slaughter. We could use a combination of those options but, broadly speaking, a headage payment and income-support approach would be the right approach to adopt.
George Eustice
I want to conclude now as we are running out of time.
The scale of, or need for, any intervention is difficult to judge at this point, because it will depend quite considerably on the approach that the European Union finally takes. As I said earlier, it is open to it to create an autonomous tariff rate quota, but it is also highly dependent on the extent of exchange rates. I can give hon. Members an undertaking tonight to reassure them that the Rural Payments Agency has already been told to design the administrative procedures necessary to make such headage payments. Discussions with the Treasury are at an advanced stage about what support may need to be set aside, while recognising that no final decisions can be taken until we actually leave the European Union.
I know that the hon. Member for Darlington has previously raised the issue of culling sheep, and she raised it again tonight. I can confirm that that is not under consideration. We regard any problems as being potentially short term and the correct approach would be to supplement farmers’ incomes through the headage payment schemes that I have described. We do not want to reduce the capacity of our flock.
We are a global player in this sector and we believe that there is a bright future for our sheep sector. However, in the unlikely event that it is not possible to get a longer-term free trade agreement with the European Union, there are, of course, other approaches that we can take. Our existing tariff-rate policy is set for just 12 months. It is open to us in future to review that and to apply certain tariffs to other EU sectors, to give our farmers opportunities to diversify into different sectors such as beef. Many of our sheep producers are mixed beef and sheep enterprises. It is also open to us to support the opening of new markets through, for instance, the deployment of new attachés to our embassy to help gain that market access. I know that the hon. Lady said that that was against WTO rules, but that is not correct. Certain types of export refunds are against WTO convention, but there is no rule against investment to support market access.
In conclusion, we recognise that the sheep sector more than any other agriculture sector is exposed because of the scale of its exports to the European Union, but the Government have been working for the past two years on modelling the potential impacts and planning the types of interventions that we may need to make to ensure that our sheep farmers are protected from any no-deal exit.
Question put and agreed to.
Aquaculture
George Eustice Excerpts(4 years, 9 months ago)
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George Eustice (Camborne and Redruth) (Con)
There are huge economic opportunities in aquaculture—indeed, Scottish salmon is one of our biggest food exports—but, as my right hon. Friend says, there are some environmental consequences. One of those is the plight of the wrasse, a species of fish found in Cornish waters. Is he aware that Scottish vessels go to Cornwall, kidnap live wrasse from Cornish waters and take them to the North sea to eat sea lice on their farms, which has a big impact on wrasse? Will he ask his officials to look at the impact on and the plight of the Cornish wrasse?
Mr Goodwill
I pay tribute to the work that my hon. Friend did, as my predecessor, in getting to grips with these issues. He is a hard act to follow. I was aware of the wrasse being kidnapped and taken to harvest the lice, and of the impact that has on the ecology in the south-west of England.
No Deal: Agriculture Tariffs
George Eustice Excerpts(4 years, 9 months ago)
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Jonathan Edwards (Carmarthen East and Dinefwr) (PC)
I beg to move,
That this House has considered a proposed tariff schedule for agricultural products in the event that the UK leaves the EU without a deal.
Diolch yn fawr iawn, Mr Hollobone. It is a pleasure to serve under your chairmanship once again.
On 13 March this year, the British Government published their temporary tariff regime for a no-deal Brexit. At the time, the announcement gained little political attention as it was the policy of the period to avoid no deal at all costs. One of the greatest failures of the current Prime Minister is her use of the phrase,
“No deal is better than a bad deal”.
She fell into a bear trap set by the extremists in her own party. When the British Government switched strategy in summer 2018 to warn explicitly about the dangers of no deal as a means of gaining parliamentary support for her deal, it was too late. The infamous phrase had legitimised the totally reckless policy of a no-deal Brexit.
With the Prime Minister’s demise, the leadership election for the Conservative party has been dominated by the question of who can puff out their chest the most on Brexit. The debate has occurred in a parallel universe, far divorced from political realities. However, one conclusion we can safely assume is that it seems inevitable that no deal will become a viable option for the next Prime Minister, so all aspects of British Government policy in relation to a kamikaze Brexit deserve greater scrutiny.
A key aspect of a no-deal situation is that, on 1 November, if the likely next Prime Minister sticks to his Halloween promise, the British Government will have to introduce an independent tariff schedule for goods entering the newly formed UK customs area. A major consequence of leaving the EU with no deal is that the territories of the British state will no longer inhabit the safe harbour of the EU customs union.
I could have concentrated on a whole range of goods that will be impacted, but I want specifically to debate agricultural products for two reasons. First, Carmarthenshire is a proud agricultural county, and therefore leaving the EU customs union will have a disproportionate impact on the communities I serve. Secondly, tariffs on agricultural products are traditionally far higher than on other goods. That is especially true of the European Union, the destination for the vast majority of Welsh produce.
As part of the EU customs union, Welsh farmers are protected by those high tariffs, which has enabled our food producers to develop high-quality goods with unhindered access to the most lucrative and largest market in the world. The agricultural industry faces not only the loss of unfettered free access to its main export market in Europe; the new tariff schedule and its accompanying quotas offer precious little protection for the domestic market from being flooded by lower standard food products from around the world. That double hit would be too much for many farmers in my constituency and beyond. I cannot emphasise the dangers to the industry enough.
Both farming unions in Wales agree. John Mercer, Director of NFU Cymru, said:
“It is absolutely clear that a no deal scenario will be catastrophic for Welsh and indeed British agriculture. A scenario where Welsh farmers have to operate under the ‘no deal’ default of WTO tariffs will have devastating effects and will severely threaten the livelihoods and business of Welsh farmers.”
I am delighted to report that Mr Dafydd Jarrett from NFU Cymru is watching our proceedings.
Glyn Roberts of the Farmers’ Union of Wales said:
“It says it all that the prospect of a hard Brexit means a rich and highly developed state is stockpiling food and hoping to use an exemption to WTO rules on the Irish border which would more normally be applied in cases of war or famine. Yet this situation is not compulsory; this is a crisis which in fact we can easily avoid by acting in the best interests of our four nations; by withdrawing Article 50 and telling people honestly why Brexit must take place over a safe and realistic timetable.”
In July 2018, the British Government lodged proposed schedules with the World Trade Organisation setting out the most favoured nation tariffs that would apply to imports to the UK after Brexit. Subsequently, in March 2019, the British Government set out proposed temporary tariffs to apply in the event of a no-deal scenario, which would see zero tariffs applied to 87% of imports measured by value for up to a year in a temporary regime, while consultation and review on a permanent tariff regime takes place.
I am pleased that the British Government have exercised at least a degree of sensitivity in their treatment of the sheep sector, recognising the need to maintain tariff protection for lamb in the event of no deal by maintaining the full WTO tariff of 48% on lamb imports. However, what they give with one hand, they take away with the other. Tariff rate quotas will allow lower or zero tariffs to be applied up to a certain level of imports on some products. We know, for example, that New Zealand will continue to enjoy significant tariff-free access to the UK market for 110,000 tonnes of lamb annually. One of our principal competitors in the lamb sector will therefore enjoy more generous tariff-free access to our market.
George Eustice (Camborne and Redruth) (Con)
I was involved in some of that work and the development of that schedule as a Minister. The existing New Zealand tariff rate quota would be split in half, giving it less access to the UK market than previously. Is the hon. Gentleman aware that, in any event, in recent years New Zealand has used only about 70% to 75% of its current rate quota because it cannot compete with lamb produced in the north-west and south-west of this country even before it reaches that ceiling?
Jonathan Edwards
I recognise the former Minister’s expertise in the matter. We will have to wait and see what farmers have to say about that. I invite him to attend the Royal Welsh show next week and make that point. I am sure he would receive a welcome response to his comments.
The new Brexit date of 31 October will coincide with very high numbers of finished lambs coming on to the UK market.
Oral Answers to Questions
George Eustice Excerpts(4 years, 10 months ago)
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David Rutley
We will do all we can to encourage local authorities to get involved. It is good to hear that Yorkshire Water is planting 1 million trees in Yorkshire. We need to do more, particularly in the hon. Lady’s area, with natural flood management techniques upstream. There is lots we can do.
George Eustice (Camborne and Redruth) (Con)
The Minister for Agriculture, Fisheries and Food (Mr Robert Goodwill)
Our rare and native breeds are an important genetic resource. There are several purposes under clauses 1 and 2 of the Agriculture Bill for which financial assistance could be provided to support our genetic heritage.
George Eustice
I declare my interest in that my family are long-standing breeders of both the British Lop pig and pedigree South Devon cattle, but genetic diversity is critical to maintaining resilience in our livestock sectors, and protecting genetic resources is a primary responsibility DEFRA. Will the Minister therefore agree to convene a meeting at DEFRA of representatives of our native and rare breeds to discuss what support would be appropriate for them under future policy?
Mr Goodwill
I was already aware of my hon. Friend’s considerable interest in this policy area. I am pleased to tell him that a workshop with breed societies will be taking place in London on 12 September to look at the issues that he has in mind. Later today I will be visiting the Lincolnshire show, where I hope to see some of the rare breeds that are bound to be there.
Oral Answers to Questions
George Eustice Excerpts(5 years ago)
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Mr Speaker
I think that one probably requires a little bit of work and finesse, but it is only a matter of time. That was a first draft.
George Eustice (Camborne and Redruth) (Con)
Welsh fishermen will be particularly interested in the application of the Hague preference since the ability to invoke it and, more importantly, counter-invoke it against the Irish Republic is critical to our interests. Will the Secretary of State confirm that the withdrawal agreement will protect our ability to invoke the Hague preference, because he will understand that it is not part of the common fisheries policy but a political convention that needs to be invoked each year?
Michael Gove
My hon. Friend makes an important point. We will be able to continue to invoke the Hague preference in certain circumstances, and it is vital that we do so in defence of our interests.
Oral Answers to Questions
George Eustice Excerpts(5 years, 1 month ago)
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George Eustice (Camborne and Redruth) (Con)
The UK has some of the highest standards of animal welfare in the world, but American attitudes to farm animal welfare remain very backward. Given that there is now a cross-party consensus in this House that we should enshrine recognition of animal sentience in law, should the Government not require the United States to pass equivalent legislation at federal level as a precondition to any trade deal?
Michael Gove
That is a very good point from someone who was an excellent Minister. I so enjoyed serving with my hon. Friend. As ever, he shows that his commitment to animal welfare and to the highest standards in farming remains undimmed. We are very lucky to have him in this House.