Environment, Food and Rural Affairs

George Eustice Excerpts

Monday 12th November 2018 Ministerial Corrections

The following is an extract from the Westminster Hall debate on the Badger Cull on 6 November 2018.

[George Eustice]

On costs, again we publish the figures every year. The 2018 costs will be published shortly, but those for previous years have already been published. Last year, the total cost of the cull was about £4 million, which covers policing, licensing and all the monitoring work done by Natural England.

[Official Report, 6 November 2018, Vol. 648, c. 529WH.]

Letter of correction from the Minister for Agriculture, Fisheries and Food:

An error has been identified in the speech I gave during the debate on the Badger Cull.

The correct statement should have been:

[George Eustice]

On costs, again we publish the figures every year. The 2018 costs will be published shortly, but those for previous years have already been published. Last year, the total cost of the cull was about £4 million, which covers policing, and a further £2.6 million, which includes licensing and all the monitoring work done by Natural England.

Badger Cull

George Eustice Excerpts

Tuesday 6th November 2018 Westminster Hall

[The Minister for Agriculture, Fisheries and Food (George Eustice)]

It is a pleasure to respond to this debate, Sir David. I congratulate the hon. Member for Derby North (Chris Williamson) on securing it. I am aware that this issue is contentious. The badger is an iconic species. It is a protected species in our countryside. I completely understand that many people have strong feelings about the policy and the approach we are taking. As I and the Secretary of State have said before, none of us wants to cull badgers for any longer than is necessary. However, to answer his question, the reason why we still have these debates is that the Government are of the clear view that it is necessary to have a badger cull as part of a coherent strategy to eradicate TB. We believe that that is firmly underpinned by the evidence—I will return to that because the hon. Gentleman and others raised questions about the science.

The badger cull is just one part of our wider strategy to eradicate TB. The absolute heart of our strategy has always been regular cattle testing and removal. In the high-risk area, we currently have annual testing; we have four-yearly testing in the low-risk area; we have pre-movement testing; we introduced compulsory post-movement testing; we have radial testing in the low-risk area, where we get a breakdown; and we have contiguous testing in the high-risk area on the farms surrounding a breakdown. All of these measures mean that we are regularly testing our herds and regularly removing reactors to that testing.

Diagnostics, which the hon. Gentleman mentioned, are important. We recognise that TB is a difficult disease to fight. It is difficult to detect because it is a slow-moving, insidious disease, and none of the diagnostic tests is perfect. However, one thing we have done is make greater use of the interferon gamma test—the blood test—to remove infection from herds when it is picked up. We are also deploying that test more proactively in areas where the cull has taken place so that we can bear down on infection in cattle. We have also introduced a more severe interpretation on inconclusive reactors to the skin test. Diagnostics are important and part of our strategy is to improve testing. We are supporting a number of initiatives to improve testing, but at the moment we are using the more sensitive blood test in conjunction with the skin test to improve our detection rates.

A number of hon. Members mentioned biosecurity, which is important—biosecurity is a key part of our strategy to eradicate TB. A few years ago, I introduced a new accreditation scheme—the cattle health certification standards scheme, or CHeCS. We encouraged farmers to sign up and to take steps to manage risk to their herd, both in terms of risk-based trading for the cattle that they bring on to their holding and in terms of protecting the herd and their farmyard from badger incursion, for instance using fencing. We recently changed the compensation regime to incentivise farmers to sign up to the biosecurity scheme, meaning that if they do not sign up to it they face receiving lower compensation for cattle reactors that they bring into their herd.

We have always been clear that vaccination, which a number of hon. Members mentioned, could have a role, particularly in the edge area, and possibly as a way of getting an exit strategy from the cull once we have borne down on the population. We have been supporting vaccination pilots in the edge area—the so-called badger edge vaccination scheme, or BEVS, which we restarted this year once vaccines became available again.

The difficulty with vaccination, as my hon. Friend the Member for Carmarthen West and South Pembrokeshire (Simon Hart) pointed out, is that we have to catch badgers regularly to top up the vaccination. It is not the case that we can inject them just once. Vaccination does not cure badgers that have the disease, so the scheme has limitations, but we have always maintained that it could have a role to assist in an exit strategy. That is why we continue, for instance, to fund work to try and get an oral bait vaccine that we could deploy in the badger population.

[Alan Brown]

How do we measure the vaccination in the edge areas as opposed to culling, which has already been happening? The Government must ensure that they correctly compare two different methodologies and that there is not cross-contamination, as it were, given the movement of badgers.

[George Eustice]

That is a very good point and precisely why we have focused our vaccination efforts in the edge area, where we are not culling badgers. The culls are being rolled out predominantly in the high-risk area where we know the reservoir of the disease in the wildlife population is a persistent problem, and are using vaccination in the edge area to ensure that we are not vaccinating badgers only to cull them.

We are also looking at cattle vaccination. We have been developing work to do a so-called DIVA test, which can differentiate TB-infected from vaccinated animals so that it would not affect our trade. Cattle vaccination deployed in the hot spots could help to give immunity to our herds, and clearly cattle vaccination is easier to deploy than badger vaccination, because a herd of cattle can be run through a crush and vaccinated—we do not have to capture wildlife to do it.

Our strategy is incredibly broad. No one single intervention will give us the magic solution to tackling this terrible disease. It is a difficult disease to fight, so we need to use a range of interventions. The badger cull is just one part of our strategy, but there are no examples anywhere in the world of a country that has successfully eradicated TB without also addressing the reservoir, the disease and the wildlife population.

TB was first isolated in badgers as long ago as 1971. In 1974, a trial was conducted to remove badgers from a severely infected farm, with the result that there was no breakdown on that farm for five years afterwards. Between 1975 and 1978, the Ministry of Agriculture, Fisheries and Food funded extensive work that demonstrated conclusively transmission between badgers and cattle in both directions. Subsequent work in Ireland reaffirmed that finding. In the Krebs review, which hon. Members cited, it was observed that between 1975 and 1979 TB incidence in the south-west fell from 1.65% to 0.4% after the cull—a 75% reduction.

Subsequently, therefore, in the late ’70s and early ’80s, more extensive work was done in three exercises. One was in Thornbury, where the TB incidence fell from 5.6% in the 10 years before culling to 0.45% in the 15 years after culling, which was a reduction of 90%. In Steeple Lees, there were no breakdowns for seven years after badgers had been cleared. In Hartland, the incidence dropped from 15% in 1984 to just 4% in 1985, which was a reduction of more than two thirds.

[Chris Williamson]

I am interested in the Minister’s comments. Will he comment on why the weight of scientific evidence before the Government embarked on the latest cull, including from people involved in the randomised badger culling exercise, suggested that it would not work? No credible scientific evidence supported the Government, yet they ploughed on regardless. Indeed, the number of herds infected with TB has not diminished either. If anything, the situation has got worse, because we now have TB in Cumbria and the Isle of Skye. Surely controls on movements and better biosecurity would be far better than continuing with this cruel cull.

[George Eustice]

I do not agree, for reasons I will come to.

There were claims that those trials in the ’70s lacked a control or a comparison, which was a fair point. That is why the randomised badger culling trial took place. Despite the challenge of a foot and mouth crisis right in the middle of it, the RBCT concluded that, in the four years after culling, there was a significant reduction in the incidence of TB. The RBCT supported what the previous trials had shown. In fact, 18 months after the culling ended in the RBCT, there was a 54% reduction in the incidence of the disease. People say that there is no scientific evidence, but I can give them all the evidence they want.

On the current trials, we now have some peer-reviewed evidence conducted on the first two cull areas. It compares the cull areas with control areas where there was no cull. That detailed analysis of the first two cull areas, over the first two years only, was published by Dr Brunton and her colleagues in 2017. It showed a 58% reduction in the disease in cattle in the Gloucestershire badger control area, and a 21% reduction in Somerset after two years of badger control, compared with the unculled areas. As I said, that is a peer-reviewed piece of work. The Animal and Plant Health Agency published raw data, as we do every year, in September 2018, showing that there has been a drop in TB incidence in the first two cull areas, where the number of new confirmed breakdowns has decreased by about 50% in both areas. In Gloucestershire, the incidence rate has dropped from 10.4% before culling began to 5.6% in the 12 months following the fourth cull. In Somerset, it has dropped from 24% to 12%. Dr Brunton and her colleagues carried out further detailed analysis into the third year of the cull in the first two areas, and it will be published shortly.

A wealth of consistent evidence, from the 1970s onwards, shows that badgers are a reservoir for the disease, that there is transmission of the disease between badgers and cattle, and that a cull of badgers in infected areas where the presence of the disease in the wildlife is known to contribute to that can lead to substantial reductions of between 20% and 50% in incidence. That picture has been consistent for at least 40 years.

[Chris Williamson]

I am grateful to the Minister for giving way again, but he did not really answer my question. The body of scientific opinion before the Government embarked on the cull was opposed to it and said that it would not work or, if anything, would make matters worse. I do not think that he has addressed that point.

[George Eustice]

A number of scientists said that it was not logistically possible to sustain a cull over a large area and to remove the number of badgers necessary. We have demonstrated that that is possible. It is a difficult and contentious policy, but it is possible to do that. No credible scientist has said that badgers are not implicated in the spread of the disease. Sometimes scientists debate the extent to which badgers have a role, but no one doubts that—the evidence shows this clearly—a cull of badgers in infected areas leads to a reduction in the incidence of the disease. Arguments tend to be about the logistical possibilities of delivering such a policy but, as I said, we have been able to demonstrate that that can be done, difficult though it is.

Let me deal with some of the hon. Gentleman’s other points. One was about vaccination and, as I said, that is part of our plan, and we envisage doing more of it in future, potentially as an exit strategy once we have seen a reduction in the badger population. That brings me to his claim about the possibility of a collapse in that population. It will never happen because we have always had provision in the licensing for an absolute maximum that must never be exceeded in any given cull year. Everything we do is absolutely compliant with the Berne convention. Furthermore, we are doing this only in high-risk areas, so we never aim to remove the entire badger population or to cause a collapse in it; we simply aim to suppress numbers while we get to grips with that difficult disease.

The hon. Gentleman mentioned cull data. That is published each and every year. Usually in or around December, we give the House a written ministerial statement and an update on all the figures from the previous year’s cull. We shall do so again this year, in the normal way, as we have done in all previous years.

[Kerry McCarthy]

If my recollection is correct, it is common for the figures to be released on the very last day of the parliamentary term before we adjourn for Christmas. Will the Minister give us an assurance that they will be published a little earlier this year, so that we have time to reflect on them before we disappear for our Christmas holiday?

[George Eustice]

I cannot give any undertakings about when exactly that will take place but, typically, we do it in December, once we have collated all the data. The hon. Lady will have to be patient and wait for the data to come out. However, we publish that every year and we are absolutely transparent about it. Every year, we also publish details about incidence and prevalence of the disease—I know that there has been an argument about whether incidence or prevalence is the right figure to use, but incidence is the correct one for measuring the role of wildlife in the introduction of the disease to cattle herds.

On costs, again we publish the figures every year. The 2018 costs will be published shortly, but those for previous years have already been published. Last year, the total cost of the cull was about £4 million, which covers policing, licensing and all the monitoring work done by Natural England.[Official Report, 12 November 2018, Vol. 649, c. 1MC.] I do not recognise the figure given by the hon. Member for Derby North of £1,000 or £2,000 a badger; it is probably in the region of a couple of hundred pounds. The costs have reduced substantially, as policing costs have come down as we have rolled out the cull but, in reality, cost per badger is the wrong way to look at it; we have to view it in the context of the fact that the disease already costs us £100 million a year—if costs are what worry us—and that if we want to get it under control, we have to use all the tools in the box.

Finally, I confirm that we received the Godfray review on 2 October and, as the Secretary of State said at DEFRA questions a couple of weeks ago, it will be published shortly. “Shortly” means what it says, which is that Members probably do not have long to wait. I can confirm that it will be published in its entirety and that we have not requested any edits or alterations. It is an independent review, led by Sir Charles Godfray, who will publish it shortly, along with his conclusions.

I should point out that Sir Charles Godfray’s review is of our strategy, so it looks at every component, including the role of badger culling, vaccination, diagnostics and whether they can be improved, biosecurity, compensation and behavioural change. It reviews every feature in our original strategy and gives some pointers about other areas that we could advance in future. I think it is a good report, and I am sure that hon. Members look forward to reading it.

[Chris Williamson]

I am grateful to the Minister for giving way for what will perhaps be the final time. My conclusion from what he says is that it is pretty clear that the only way in which the badger cull will be brought to an end is with the election of a Jeremy Corbyn-led Labour Government.

[George Eustice]

All I can say is that I have explained why we think the badger cull is critical. I know that it is contentious, but it is the right thing to do, and sometimes Governments have to the right and responsible thing. We have this mess today because the last Labour Government put their heads in the sand, meaning that we had 15 years of total inaction during the early part of this century. The disease got out of hand, and we are now trying to get a grip of it and to roll it back.

[Chris Williamson]

Will the Minister give way?

[George Eustice]

No, I have given way to the hon. Gentleman, and I have finished.

Agriculture Bill (Eighth sitting)

George Eustice Excerpts

Thursday 1st November 2018 Public Bill Committees

[The Chair]

I remind the Committee that with this we are considering new clause 10—Annual assessment of funding for purposes—

“(1) The Secretary of State must report on funding for each purpose listed in section 1.

(2) A report under subsection (1) must be made for each financial year and must be laid before both Houses of Parliament no later than 31 October in the financial year following the financial year to which the report relates.

(3) The first report shall be made by 31 October 2019 and shall relate to funding in the 2018-19 financial year.

(4) A report under this section must record, on the basis of best data available—

(a) the total sum of funding allocated to each purpose in section 1,

(b) the source of any element of funding under subparagraph (a) which comes from public funds, and

(c) the sums from each source under subparagraph (b).

(5) The Secretary of State must include in each report under this section—

(a) a statement of their opinion on whether any sum recorded under subsection (4) is sufficient to meet their policy objectives in relation to each purpose; and

(b) a statement of the Secretary of State’s intentions if, in their opinion, a sum recorded under subsection (4) was not sufficient to meet their policy objectives in relation to a purpose.

(6) For the purposes of this section, ‘funding’ includes any payment, grant, loan or guarantee.”

This new clause would require the Secretary of State to report annually on the funding allocated to each of the purposes of the Bill, on its sufficiency to meet policy objectives and on the Secretary of State’s intentions if in their opinion funding for any purpose was not sufficient.

[The Minister for Agriculture, Fisheries and Food (George Eustice)]

I turn my attention now to Opposition new clause 10. I recognise that there is a very big issue behind the new clause—funding. We completely understand that. We need to ensure that we have the funding in place to support the purposes we outline in clause 1 in particular. We are absolutely clear about the importance of that. That is why we made a manifesto commitment, which we will honour, to keep the cash totals we spend on agriculture policy the same for the duration of this Parliament—we hope until 2022.

There is also provision in the Bill for a long, seven-year transition. Although we have given no concrete undertaking about the exact quantum of funding after 2022, it is implicit in the Bill and in the nature of the transition that there will be ongoing funding thereafter. We also made a manifesto commitment to introduce new schemes to replace the current common agricultural policy, and that is what the Bill is all about. On 16 October, the Government announced that they will review the intra-UK allocation for domestic support, which will go some way to giving consideration to how we allocate funds within the UK and set the ground rules for allocations after 2022.

At the moment, we spend around £3 billion a year on the CAP. In the scheme of things, compared with the spending of many other Departments, that is a relatively modest sum, particularly if we refocus those resources to delivering public goods—improving the quality of our soils and water, enhancing the beauty of our landscapes, and supporting key Government objectives, such as promoting biodiversity and wildlife on farmland and reducing our climate change emissions to mitigate the impact of climate change.

However, new clause 10 is less about the size of the budget—no doubt we will discuss that later—than about annual reporting on the budget. There are two reasons why it is unnecessary. The first is technical. The new clause would create a legal requirement to list the total funding for each of the purposes outlined in clause 1. As I made clear on Tuesday, the difficulty with that is that many of the interventions we seek will cross multiple purposes. We may have schemes that enhance animal welfare but also the environment, or that enhance the environment but also mitigate the impacts of climate change. It would be difficult to separate those things out and report on the basis of individual purposes.

Strangely enough, it would be far easier to report even more granularly—to report how much money we spent on integrated pest management schemes, catchment-sensitive farming schemes or schemes to enhance farmland birds or pollinators, for instance. We would probably be able to extract that information from individual agreements and aggregate it for reporting purposes far more readily than we would be able to pigeonhole expenditure within the purposes outlined in clause 1.

The second reason—the hon. Member for Stroud may have forgotten this, but he was in the House at the time—is that the last Labour Government introduced the Government Resources and Accounts Act 2000, under which the Department for Environment, Food and Rural Affairs already has a statutory duty to present an annual report and accounts to Parliament, detailing all our expenditure. These days that includes quite a comprehensive list, as well as reporting of the Department’s priorities and how it is delivering, for example, on its business plan.

[Mr Robert Goodwill (Scarborough and Whitby) (Con)]

Is it not also the case that hon. Members who might have an interest in such things may table parliamentary questions and need not wait for the publication of an annual report?

[George Eustice]

That is absolutely the case, as my right hon. Friend points out. We have scrutiny by the National Audit Office, the Environmental Audit Committee and the Environment, Food and Rural Affairs Committee, for example, and I always enjoy the many parliamentary questions I receive on every piece of detail about DEFRA’s spending priorities.

A statutory requirement to do annual reporting on DEFRA is in place already. However, this is an important point, so at a later stage of the Bill—perhaps on Report—I might be willing to explain to the House in a bit more detail what information we would envisage publishing as part of our requirements under the Government Resources and Accounts Act. In a world in which we want transparency about how we spend money in this area and what it is delivering, it may well be possible for us to decide to adopt a convention on the particular format of these annual accounts. I am more than happy to return to the House on Report to say a little more about that. On that basis, I hope the hon. Gentleman will not press new clause 10.

[Dr David Drew (Stroud) (Lab/Co-op)]

That is all very interesting, and I largely concur with what the Minister says. The academic Steven Lukes, in his wonderful little book “Power”, always draws a distinction between the “power to” and “power over”. The problem with Government and that piece of legislation in 2000 is that it was all about how Government decide to report and to defray their financial considerations. To me, this is “power to”; it is a more consultative arrangement—there is a need to have a reporting mechanism whereby the Government say what they intend to spend.

That is nothing new, and it is exactly what happens every year under the CAP, which has a mechanism whereby the Council of Ministers signs off the budget, which is then reported to not only Parliament but all the farming organisations. The reality of that is that the farmers are either well pleased or start burning their tyres. That is where we are with agricultural politics, which is big on the continent, if not so big here, because our farmer organisations tend to work through the system. That, however, is the point: they are asking for a system to be put in place.

Farmers are very worried that if such a mechanism is not in place, a future Government of whatever colour or persuasion could, in effect, just say, “Well, there isn’t enough money, so we’re making large cuts, including to all these wonderful schemes that we’ve talked about.” The Minister is very lucid about how all these different organisations could be brought in, but it will not make a jot of difference if there is not any money to run the schemes.

In a sense, the new clause would protect any organisation or any person who clearly wants to obtain funding through the system available. It would give them some security, and all people are asking for is security and certainty. Although we shall not have a vote on the new clause at this stage, I hope that the Minister will reflect on it. It will come back in the Lords, but it is always nice if we can do things in the Commons.

There needs to be some mechanism to say not what the money is but how it will be defrayed. That is important under the CAP, where we had not just pillar 1 but pillar 2. For some of us in rural areas, that pillar 2 money was very important. There is security in knowing in what ways we can go on to make future plans. Otherwise we are subject to the whim of the Government. As has been pointed out before, an urban-centred Government might decide they did not want to farm the country, but wanted to use it for all sorts of other things. I would not want that, and neither, I am sure, would anyone on the Committee. However, it is the danger.

At least there could be a requirement to go on the record and state what was to be spent and how it was intended to keep the different provisions going. We shall not press the matter to a vote at this stage, but we shall keep the right to return to the matter for a vote at an appropriate time.

Question put and agreed to.

Clause 2 accordingly ordered to stand part of the Bill.

--- Later in debate ---

[Simon Hoare (North Dorset) (Con)]

I think there are two things that taxpayers would presume to be inherent to this, and which they would require. First, the hon. Member for Stroud alluded to the need for transparency and to know that moneys being provided by the Exchequer through DEFRA to support any public good or food production scheme are being spent wisely. There must be public confidence in this, and I go back to a point I made in Tuesday’s debates: in the increasingly urbanised country we live in, which is less interested in rural life, it is imperative that the public know that, just as we insist on transparency, fairness and rectitude in, for example, the welfare system or other things.

The balance that I detect, certainly from my right hon. Friend the Member for Scarborough and Whitby and my hon. Friend the Member for Ludlow, and which I echo, is that while we must have these powers to allow public confidence to set in, be fostered and flourish, we must also have proportionality and discretion. It would be frankly bonkers to trot somebody off to the magistrates court, the Crown court or indeed the High Court over somebody’s daughter riding a pony on a bit of set-aside, as my right hon. Friend the Member for Scarborough and Whitby has said, or other such small things.

We need within the Bill—I think it is referred to in other subsections of the clause—the discretion to say, “Right, we have overpaid you for that, or you haven’t done this in-year, so we will roll over,” and so on, which provides the transparency and accountability.

However, we must remember that a lot of our farms and farmers are small businesses, where people do not have time and space to go off and instruct a solicitor, get their defence ready and take those two or three days off to go to court—only to find that the court hearing has been adjourned because the judge is not available or the chief usher has a heavy head cold. In many of our smaller courts, which are also constrained in terms of manpower, there is a huge delay in the delivery of justice.

I hope my hon. Friend the Minister will reflect on what I appreciate are often competing demands, namely for transparency and discretion. The heavy hand can often fall on, “Let’s go really big on the criminal stuff,” and we have a pretty crowded statute book at the moment. I think that is why lawyers are able to charge so much money, because there is a hell of a lot of reading involved even in making a case for a minor or small point.

Let us not overcrowd the statute book with statute law and criminal offences if we do not need to. We should ensure that the robustness is there, as in those other clauses, but I urge my hon. Friend the Minister—not today, but either in the other place or on Report—to reflect on the considered and informed remarks of my right hon. Friend the Member for Scarborough and Whitby and my hon. Friend the Member for Ludlow, and on my small and amateurish contribution.

[George Eustice]

I confess that when the Bill was drafted that particular bit about creating offences jumped out at me too, and I discussed it at some length with our legal advisers and officials. I can confirm that we seek only to replicate powers that already exist.

The Common Agricultural Policy (Control and Enforcement, Cross-Compliance, Scrutiny of Transactions and Appeals) Regulations 2014 already provide for offences, and there has always been the ability to provide for criminal offences under EU regulation and the enforcement regulations, which are in secondary legislation.

The idea was always that those offences could include such things as intentional obstruction, the deliberate failure to give required assistance or information or knowingly to provide false or misleading information. I reassure the Committee that, during the time we have had those powers, the RPA has never brought criminal sanctions. It has never needed to, because other interventions have been sufficient.

A number of important points have been made, and I listened carefully to those raised by my right hon. Friend the Member for Scarborough and Whitby and my hon. Friends the Members for Ludlow and for North Dorset. The hon. Member for Ipswich also raised the legitimate point that there is already alternative legislation to deal with fraud. I am grateful to the shadow Minister, the hon. Member for Stroud, for not pushing the amendment to a Division today.

Given the representations from my hon. Friends behind me and from others, I am certainly willing further to discuss this issue with Government colleagues, and perhaps to come back to Parliament on Report to give it further consideration. We are clearly going into a changing world and a changing situation, and it might not be necessary to bring across all the sanctions available to us under the CAP scheme. It might be that the many other provisions—including being able to disqualify people from entering schemes in the future, penalties, an ability to recover or withhold moneys and so on—alongside existing criminal powers, are sufficient. We will undertake to look at that.

[Ben Lake (Ceredigion) (PC)]

On that point, will the Minister clarify, either today or on Report, the status of the power to create offences granted to Welsh Ministers under paragraph 3(2)(h) of schedule 3? Does that also mean amending criminal offences and creating new ones?

[George Eustice]

The power to create new offences is in the Welsh schedule. It is a decision for the Welsh Government whether they wish to change that as the Bill progresses. That is clearly a decision for them, and I will not give any indication about what they might do.

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

I find it quite strange to be in great sympathy with the hon. Member for Stroud, but, after that direct answer from the Minister, which I thank him for, I urge him to have another look at the clause. We look forward to discussing it on Report. We have concerns.

[George Eustice]

I very much look forward to discussing the issue further on Report. As I said, in considering the mood and sentiment of the Committee, I undertake further to discuss the issue with Government colleagues and to report back to the House on Report. I hope that, on that basis, the hon. Member for Stroud will agree to withdraw his amendment and keep his powder dry for another day.

[Dr Drew]

I certainly agree. A report by the House of Lords Delegated Powers and Regulatory Reform Committee identified some concerning inconsistency between clause 16, which contains an extended treatment in respect of monetary penalties, and clause 3, which does not. However, so long as the Minister looks at that, I will withdraw the amendment without further ado. I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 3 ordered to stand part of the Bill.

Clause 4 ordered to stand part of the Bill.

--- Later in debate ---

[George Eustice]

I oppose this probing amendment for reasons that I shall set out. The shadow Minister made the good point that people want certainty. In the Bill, we have tried to give a clear direction of travel—that is to say, we believe that the end state should be a system in which we reward farmers based on the delivery of public goods, be that animal welfare or higher environmental outcomes, and in which we tackle the causes of low profitability in farming by improving transparency and fairness in the supply chain and making grant support available to farmers to invest in the future.

The difficulty I have with this amendment is that it would largely undermine the purpose of a transition, if the idea is that we would increase direct payments during the transition. If there were a particular problem that meant that a future Government decided they had to pause the transition, it would be open to them under clause 5(2) to extend the transition period. Provided that they brought those regulations in during the transition period, they could extend it for as many years as they liked, and if a future Government so decided, they would have the ability to say that they would not pursue what we have outlined, which is a phasing down of direct payments. It would be open to a future Government, if they deemed it the right thing, to pause that process, extend the transition and slow or halt the rate of decline. That option and that power are already in the Bill.

The issue I have with saying that a future Government could also increase direct payments during that time is that that would effectively undermine the direction of travel we have set out. It would mean that there was less money—potentially no money—to do the pilots we talked about earlier for the new environmental land management scheme that we want to roll out. It would mean that there could be less money, or no money, to make available to support new entrants to the industry or to help farm enterprises to invest for the future.

Of course, in addition to having the power already to pause and slow the taper on the single farm payment and to extend the transition period, later parts of the Bill, which we will come to at a future date, also contain intervention powers. Those are powers, in a severe market disruption, for the Secretary of State to declare exceptional circumstances in the market and intervene directly at that point to provide income support or market stabilisation measures. I believe the Bill strikes the right balance and sets a clear direction of travel, and my objection to this amendment is that it would largely undermine the purpose of the transition period.

If people want certainty, they need the certainty of a seven-year transition, but also an understanding that in all normal circumstances it is the Government’s intention to reach an end state at the end of those seven years. If we introduced the uncertainty that it might all be changed and that we might pay even more via direct payments, people frankly would not know where they stood, and I think that would send a mixed message. I hope that, on that basis, the hon. Member for Stroud will withdraw amendment 102 and not press amendment 104.

[Dr Drew]

I am happy to do so. Again, these amendments are just teasing out how the process will work in practice. It will be a difficult process; we are, in effect, asking people to change their business orientation completely in a relatively short time. They will have to learn to do very different things. That is why it is important to know, if those things do not work out, what the Government’s response will be. I think the Minister has said what the Government’s intention is. Only time will tell whether it works in practice. I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 5 ordered to stand part of the Bill.

Clause 6

Power to modify legislation governing the basic payment scheme

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[Dr Drew]

I should say in passing that there was a Henry VIII power in clause 5 that we allowed to slip through. It is one of the powers that no doubt the House of Lords will have great joy in pointing out to the Government, when and if the Bill gets there.

We are now considering clause 6 and two straightforward amendments, looking at the powers to modify from one system to another. The question is what the clause really adds to the Bill, given that clause 7 tells us that it will phase out direct payments and de-linked payments. One wonders why this power is in there at all and what the Government are doing by keeping the clause there. We would question why clause 6(2) and clause 7(8) are there and whether they are necessary. As the Minister has just said, either we have the strength of our convictions and we are going towards the greening of the farm, food and environmental system, or we will always be thinking that we could go back to a basic payment arrangement if all else fails.

Will the Minister explain what the clause does? The reality is that, if it remains, in extremis there is nothing to stop the Government going away from a greening payments system altogether and looking at other arrangements, as the explanatory notes highlight. Although we question whether the clause adds anything, if it was used inappropriately it could be quite dangerous.

[George Eustice]

I am grateful for the opportunity to address why there is a need for this subsection of clause 6. The greening provisions in the CAP, by the admission of the European Commission and the EU auditors, have achieved next to nothing in environmental outcomes.

The genesis of the subsection was the fact that in the last CAP reform voices in the European Parliament pressed for a move away from pillar 1 direct payments and for greater emphasis to be placed on pillar 2 agri-environmental schemes, while the Council of Ministers and member states resisted that and clung to the idea of direct payments. The outcome was a classic EU fudge, which attempted to put greening conditions on to the direct payments in a way that has not been effective.

We have ended up with rather ludicrous rules, such as there being one window in which land must be made fallow for the purposes of the ecological focus area rule and a separate window for the purposes of the three-crop rule. There is all sorts of confusion because people have fallow land and they have to work out whether it is fallow for the purposes of the EFA rule or for the purposes of the three-crop rule.

There are also lots of unintended consequences of the three-crop rule and problems with different species being treated as the same. I remember having a long argument with our officials some years ago about whether a cabbage and a cauliflower were the same or a different species, whether a winter cauliflower was different from a summer cauliflower, and whether spring wheat was different from winter wheat. Our contention is that introducing rules of that sort to the direct payment scheme has ultimately failed, as even the EU admits.

The inclusion of these powers gives us the ability to switch off the greening provisions. As things stand, 30% of the single farm payment is linked to the greening conditions. One of the National Farmers Union’s concerns is that we have a secret plan to remove the greening conditions and take 30% of the single farm payment at the same time. I reassure the NFU that that will not happen, because the way the wiring of the scheme’s funding works means that if we remove the greening requirements, the payments linked to them automatically go back into what is called the national ceiling—the budget allocation—and are reflected in the remainder of the basic payment scheme payments. This will not affect farmers’ payments, but it will enable us to remove a lot of the unnecessary administration and checking around the greening requirements, which have achieved very little.

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[Jenny Chapman]

That is a good point. If there is any purpose to our being in Committee two days a week for however many weeks is necessary, it is that we want to improve the Bill.

The process we have followed, including our taking evidence, has enabled us to make suggestions, many of which—although not all—came from third-sector organisations, interest groups or the National Farmers Union, for example. We have really gained from their expertise. The Bill will clearly be amended—it will not be the same as it is now by the end of the process—and I genuinely think that we have benefited from that input. Input is welcome, and it ought to be available to the Government if they intend to make substantive changes to any other measures as well.

The only other thing I say to that is that we will come later to amendments that address consultation and how we might better involve other organisations in shaping our future policy. It is important to note that, by using these affirmative or negative procedures, we cut out from the process not only expertise from organisations but most MPs as well. Let us not forget that Members do not just stick their hand up and get on one of those Committees. There are filters that sometimes enable and sometimes prevent Members from exercising the privilege of taking part in the consideration of measures.

There are many reasons to be concerned about the extensive use of regulations to amend the very legislation in which those regulations are contained. I have deep reservations about the overuse of the negative procedure. I hope that the Minister will confirm that his amendments, which are grouped with my amendment 76, have been tabled to address some of those concerns. Although they will not address my concerns about the use of regulations, he might at least assure me that he intends to use the affirmative procedure, rather than the negative.

[George Eustice]

I will also speak to a large clutch of Government amendment—amendments 2 to 5, 7, 8 and 12 to 14—in this group. To reassure Committee members, most of them are identical, so I can deal with them quite quickly.

I begin by addressing the points raised by the hon. Member for Darlington regarding her amendment 76. The amendments we have tabled will not achieve exactly what she is trying to achieve with her amendment. However, they will achieve something important, which is to establish that the affirmative procedure will be used if consequential amendments need to be made to primary legislation. I will explain that in more detail later. It is a technical point, but having been on certain Committees, she is clearly familiar with it.

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[The Chair]

With this it will be convenient to discuss the following:

Government new clause 2—Power to reduce the direct payments ceilings for England in 2020 by up to 15%.

Government new clause 3—Power to provide for the continuation of the basic payment scheme beyond 2020.

[George Eustice]

I will speak to new clauses 2 and 3, which are largely technical amendments. New clause 2 relates to the ability to have an inter-pillar transfer. It allows us to modify retained EU regulations to provide for a smooth transition from the current direct payments scheme to our future arrangement, in line with our stated plans. We have said that we plan to allocate the money paid in direct payments for 2020 in England in much the same way as we do now. We have also committed to uphold the current level of agricultural funding under pillar 2 until 2020, as part of the transition to new domestic arrangements.

The new clause will allow the UK Government to maintain the direct payments budget in England in line with preceding years. It is modelled on existing powers to reduce the direct payments budget, which allows member states to make a reduction of up to 15% in each year up to 2019. Up to and including 2019, we have chosen to redirect 12% of the overall pillar 1 budget to rural development schemes in England. The direct payments regulation does not allow for a similar reduction in the direct payments budget for 2020, but the new clause will correct that and allow us to make that reduction. Without the new clause, the direct payments budget would increase in 2020, which would not be in line with our stated commitment and would go against our aims for a smooth transition.

Regulations made under new clause 2 will be subject to the affirmative resolution procedure. They will affect a large number of recipients and entail a significant spending decision, so we feel it is right that they receive full parliamentary scrutiny. However, our intention is ultimately to maintain the status quo in terms of the current arrangements for inter-pillar transfer.

New clause 3, which is also a technical amendment, will ensure that we are ready for all eventualities. It has been tabled with due concern for providing a smooth transition for farmers from direct payments to the future scheme. As I said, it is our intention to de-link direct payments at some point during the transition period, but first we will stop making payments under the basic payment scheme. In other words, the basic payment scheme will not operate after we have begun making de-linked payments.

Clause 7 provides the powers to de-link payments, either at the start of the transition period in 2021 or part of the way through the transition period. However, the CAP regulations, as retained, do not allow us to make basic payment scheme direct payments beyond 2020. Financial amounts are specified in the annexes only up to and including 2020; to continue making basic payments after that, it is necessary to provide a means to determine a financial amount beyond 2020. New clause 3 does not change our intentions for de-linking, but it gives us the powers that we need to set a national ceiling to enable payments to take place.

The hon. Member for Darlington will be pleased to know that regulations made under new clause 3 will be subject to the affirmative resolution procedure. The regulations may specify the method of calculation for a ceiling, rather than an actual financial amount. We have chosen that approach because the regulations will have an effect on a large number of farmers. I beg to move the two new clauses in the name of the Government.

[The Chair]

You cannot move them yet.

[George Eustice]

I will move them later.

[Dr Drew]

We all make slight errors from time to time.

I have some questions for the Minister. I agree that the new clauses look like technical amendments, but I do not quite understand how new clause 2 relates to the Government’s policy document “Health and Harmony”, which sets out very different percentages for the gradual reduction of the basic payment. I presume that the new clause supersedes that document—or does it?

The policy document gives very clear figures for the direct payment bands: a 5% reduction for up to £30,000, a 10% reduction between £30,000 and £50,000, a 20% reduction between £50,000 and £150,000, and a 25% reduction for more than £150,000. That clearly implies that larger holdings would have more than 15%, so I do not understand how that relates to the figure of “up to 15%” in new clause 2. Does the new clause supersede the policy document? If not, what is the status of the policy document? Perhaps the Minister might like to start by answering that point.

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[George Eustice]

May I intervene to point out the policy context? The UK Government took a decision in 2014, under the powers available to us under EU law, to modulate up to 12%—in other words, to take 12% out of the pillar 1 budget, reducing farmers’ overall BPS payment, and move it into the pillar 2 budget to support agro-environment schemes or the rural development programme. All we seek to achieve with this power is the roll-over of the legal underpinning that supported that modulation rate. Our proposed taper on the basic payment scheme will be on the existing payment; it is a taper on the payment after 12% has been modulated to pillar 2.

[Dr Drew]

I think I understand that, but I will clearly have to read it back quite carefully, because I am not sure that I totally understand it. I will see if I can get this right: we have taken 12.5% out, which might well have been the pillar 2 moneys, and we are now looking at a scheme, for what remains, that moves from the basic payment, through a de-linked mechanism, to some environmental payments. Is that largely right?

[George Eustice]

That is broadly right. Farmers currently receive a BPS payment, which is an allocation from the pillar 1 budget minus the 12% that was moved across in 2014. We reviewed that decision in 2016 and said that we would keep it the same until 2019. All we want is continuity for 2020, and this gives us the legal underpinning that we need to maintain the modulation decision taken in 2014. Any future taper and phasing down of the single farm payment, as outlined here, will be based on the BPS payment that farmers have become accustomed to receiving since 2014.

[Dr Drew]

I will read this interchange back very carefully to see whether it has been about what I think or whether I have misunderstood. This matters because, at the end of the day, farmers need to plan ahead, and 2021 is not that far in the future. Some farmers will lose a considerable amount of money, which they will have to replenish by moving into the new scheme, which we do not quite have yet.

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[George Eustice]

This debate links to a discussion we had earlier about setting a clear direction during the transition period. I understand that the purpose behind the amendment is to try to tease out a bit more what we have in mind when it comes to the de-linking of payments.

We believe that many farmers—sometimes they are in upland areas, sometimes they are on tenancies; often they are in their 70s, sometimes they are even older—who probably should face the decision to retire should have support in doing so, but it is not always easy for them. Sometimes they will have some residual debt or an overdraft and always be hoping that next year might be the good year that will put them in a better position.

If we want to have a vibrant, profitable farming industry in the future, we think it is right to support new entrants and put in place the right schemes that will help some farmers retire with dignity. We will de-link the payment from the need to farm the land and for it to be connected to the land. There is provision in a separate part of the Bill for us to bundle up several years of payments into one lump sum. Through those measures, that 70-something farmer who probably should retire, or would retire if he felt he was financially able to, may take a lump sum as a voluntary exit package to sort out some of his liabilities, pay off his creditors and take that decision to retire with dignity. In doing that, we will create an opportunity for new entrants who are coming in while, equally, helping to safeguard good retirements for those farmers for whom it is right to step back. That is one of the thoughts behind de-linking.

Also, in the final stages of the transition period it might be the right thing to de-link everyone’s payments from needing to be linked to the land. Through that, people can have complete freedom over what they do with that money, whether they invest it in new equipment, choose to retire or put it into some crisis reserve to give them a buffer. We want to free them up to do that as we prepare for the move to a new system.

[Mr Goodwill]

On the point the Minister raised regarding the farmer who might want to retire and take three years’ payments, one question we tried to explore during the evidence sessions was what would happen to the new entrant coming on to that farm, who perhaps for the first two years on that farm would not receive any support, which might make it difficult for him to establish that business.

[George Eustice]

I understand my right hon. Friend’s point, but of course we must view all this in the context of a seven-year transition period, at the end of which it is our objective and our vision that there will be no basic payment scheme as it is known today. What we would envisage happening in those scenarios is that we would free up land for new entrants to come in, who would get used to working in a different way from the start.

It would be quite possible, for instance, to prioritise the roll-out of a new scheme to those new entrants coming on to land that had been exited and was no longer eligible for the BPS payment. I would also envisage that some of those new entrants coming on to that land would also be likely to qualify for the productivity support. We have to see all this in the context of the fact that we do not want a single farm payment to be carrying on forever. We have set a clear pathway to move to a different approach over a seven-year transition period.

[Martin Whitfield (East Lothian) (Lab)]

Is not the situation that the Government envisaged one where, by using this de-linking, some farmers may release themselves from land that they see as being less profitable in the future, take advantage of the de-linking, retain land that is more profitable and then continue to claim for that—in other words, make a profit by reducing their business to shape it for what will make money for them again in the future?

[George Eustice]

Broadly speaking, although, as I said, one of our key thoughts behind the concept of de-linking is that it will be a tool to assist people with retirement. Because we do not want multiple systems—a new system emerging, a legacy system and a de-linked system—we have drafted this in such a way that, once someone takes the decision to de-link, it will apply to everyone and we will not have that problem. It will be a bold policy to help to support structural change and give farmers the freedom to invest that money as they deem right.

Government amendment 91 is another technical amendment that simply reflects the way the current direct payment regulations operate. There has been no change to our policy of trying to de-link payments, but the current direct payment regulation only contains financial provisions known as “ceilings” until the end of the 2020 scheme year. Introducing de-linking in 2021 means that ceilings under the direct payments will not be set for 2021. The existing basic payments will therefore automatically end in 2020 and we will not need to terminate such payments. The amendment reflects that. Other than that, the intent is exactly the same as originally drafted, but the amendment makes it clear, crucially, that de-linked payments cannot be made alongside the direct payments under the basic payment scheme, in line with clause 7(3)(b).

This is a technical amendment simply to deal with a similar point to the one I addressed with respect to one of the new clauses, which is that the ceilings expire and we might want to be able to make those de-linked payments based on a direct payment and not necessarily on the old BPS payment. Again, this is a technical issue that has its genesis in the way that EU payment ceilings and budgets are wired. I hope I have given the Committee a good explanation of what we seek to achieve through the amendment.

[Dr Drew]

I do not think farmers need agronomists; they need lawyers to go through some of this and work out whether they are entitled to various payments. It is a wee bit complicated, but maybe it will all be clearer when it comes out in the wash. As I have said to the Minister, I have always supported a retirement scheme for farmers. For too long, too many people have tried to stay farming when it is really not good for them or for their holdings. I welcome the fact that there is now a mechanism by which they can leave the land, by managing to take the payments over time.

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[Chris Davies]

There are many farmers in Herefordshire and Shropshire who will own land 30, 40 or 50 miles into Wales, so does Minister foresee any difficulty with decoupling in cross-border schemes if both devolved areas end up with different schemes?

[George Eustice]

We have had a comprehensive debate, and I want to pick up on some of the points that were made.

The Opposition’s amendment 107 is about making provisions for determining the status of those persons who have received de-linked payments where the agricultural transition period has been extended. That links to the point that I addressed earlier. We are setting a clear course here, and if a decision is made under clause 7 to de-link all payments, as far as we are concerned there will be no turning back at that point. It will be possible, under subsection (1)(a), to continue with the basic payment scheme and make a decision to extend, but if at a later stage of the transition period a decision is taken to de-link all payments, from our point of view it is not possible at that point to turn back, nor would we want to do so. If at that point we decided that we still wanted an old-style subsidy system, the right thing to do would be to pass new primary legislation because that would be a major departure from what we envisage in the Bill.

I was asked about de-linking and about what will happen at the end and whether we will put conditions on what people can spend the payment on. During the transition, we envisage there being a progressive, year-on-year phasing down of the BPS payment. Alongside that, we will roll out new grants for such things as productivity, and we will roll out the new environmental land management scheme.

There is already a huge amount of bureaucracy, inspection and tedious form filling behind the BPS payment. If in year three, four or five the BPS payment is considerably smaller than it is now, farmers will rightly say, “Isn’t this a sledgehammer to crack a nut? Our BPS payment is much smaller, yet we still have this extraordinary inspection regime, we still have to employ agents to fill out all the forms, and we still have to have someone from the Rural Payments Agency come to walk our fields and inspect everything.” At that point, people will rightly ask whether the enforcement architecture surrounding the BPS payment fits the size of the payment, given that it is necessarily being phased out.

That is why our view is that if we de-link the payment we will not attempt to put conditions on that, because it will be a diminishing sum of money anyway towards the latter part of transition. We have not decided when to de-link. That might come later; it could be at the beginning—that is provided for. We would consult on that, but my expectation is that for a period we would phase down the existing BPS payment. A point would then come when, frankly, having all the architecture that we have now to enforce it would cease to be justifiable, and simply de-linking to get the system closed down would be the right thing to do.

The answer to the Landworkers Alliance, the members of which generally complain to me that they are ineligible for the BPS payment at the moment anyway, is that in so far as some of them might be eligible, if they took a de-linked payment they would be able to spend it on anything they wanted, as would any other farm.

A slightly separate provision—although it is linked, and they overlap in some respects—is clause 7(7), which creates a parallel power for us effectively to do what I described earlier: make a rolled-up payment of several years to a farmer who might be deciding to leave the land. We may exercise that whether or not we had de-linked. It will be open to us to run a scheme basically to make an exit payment to farmers, with several years rolled up in one, even if we are proceeding on the basis of clause 7(1)(a)—that is the phase-down. It will also be open to us to do it under subsection (1)(b), but if we were using subsection (1)(b) towards the end of the process to free everyone from the need to have their payment linked to the land, it might be less attractive at that point as an exit package.

[Dr Drew]

I have some fairly basic questions. Who makes the decision, and is it capped? Lots of farmers might say, “Great—we’ll take the money now. We’ve always wanted to retire.” The average age is somewhere between 60 and 65. Is the figure capped or could, effectively, thousands of farmers decide that now is the time to go?

[George Eustice]

Any regulations will be under the affirmative resolution procedure. We will work with industry and others on the precise scheme designs. We will not do it in a hurry. We think there is a great logic to de-linking payments towards the end of the scheme. We also think that having a scheme that supports retirement with dignity and voluntary exit is useful. That is why we have provided for that to be done under subsection 7(7).

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[Dr Drew]

I think the Minister has answered the hon. Member for Ludlow well, but the trouble is that that is just the theory. My tenant may suddenly get tens of thousands of pounds. If he has left the farm in a very poor state, he may leave the holding. That is a potential legal minefield, which the Government need to look at. The general view is that rents will decrease after the area payments scheme goes. I was at a farm on Friday, however, and the farmer I spoke to was very clear that once the area payments scheme goes, the landowner will want to put the rents up because they will believe that they are losing out and the tenant could pay more. There are some complications here.

[George Eustice]

I would almost say the opposite. If the market is such that a number of people choose to retire and there is no longer the inflationary pressure of a BPS payment driving up rents, rents might decline in some areas. That is not necessarily a bad thing. If rents go down, it is not great for landlords, but it creates opportunities for new entrants to come in with lower overheads and produce food for the country. There is a problem with the BPS scheme, which has inflated rents and made it difficult for entrepreneurs to get on to the land and make a sensible living.

Amendment 108, which was also tabled by the shadow Minister, puts explicit timescales on payments. I understand the frustration of many hon. Members who have had farmers coming to them in recent years and complaining that they have been unable to get the payment. We address the issue in a number of ways. First, under retained EU law, the existing timescales already set out in EU law would come across. I know that farmers will generally take the view that unless they are paid in December their BPS payment is late. In fact, the payment window opens at the beginning of December and closes in June, so there is quite a wide payment window under EU law. That will come across through retained EU law, but we have made some improvements in recent years in terms of getting money to farmers as quickly as possible. Last year more than 90% got to farmers by the end of December.

[Mr Goodwill]

Of course, in the past when payments have been delayed, fines have been payable to the European Commission. Under the new scheme, presumably there would be nobody to pay a fine to.

[George Eustice]

That is absolutely correct, but the scrutiny of Parliament will demand action. I was going to say that one of the strong features of the Bill is the fact that it gives the Government the power to act to sort out the dysfunctional EU auditing processes that create late payments.

Clause 9 gives us powers to sort out what is called the horizontal regulation. That is the regulation that sets out all the conditions on payment and the plethora of audit requirements, which often duplicate one another and are unnecessary. The primary cause of the problem we had last year in the BPS system was that under EU law we were forced to remap 2 million fields in one go, to try to get their area accurate to four decimal places. If we had not done, that we would have had a fine from the European Commission of more than £100 million, so we had to attempt the exercise. However, it inevitably caused problems on some farms. Many hon. Members will have had farmers reporting to them that fields had disappeared, or, in some cases, their neighbour’s fields had ended up on their holding. That is what happens when we try to remap 2 million fields. We would not have had to do that, had we had the powers to strike down those requirements.

Secondly, the issues we have at the moment with the countryside stewardship scheme are largely due to the fact that the EU, under horizontal regulation, introduced a new requirement that every single agreement must commence on the same date; so whereas we used to spread the burden of administration across the year, with people able to start in any month, everyone had to start in January. That meant a huge pile of application forms coming in at the same time. Our agencies had to employ lots of temps to try to process the work; and we all know what happens if there is a surge of temporary agency workers to process work. There were inevitably errors and problems. Again, we could remove those rather ludicrous requirements that the European Union imposes on us—in that case under clause 11.

I hope that I have been able to provide some further information about how we would intend to use the clause 7 powers, both to de-link and to make lump sum payments available. I hope I have also reassured hon. Members that the answer to the problem of late payments lies in clauses 9 and 11, not in an amendment to clause 7.

[Dr Drew]

I do not intend to press the amendment to a vote. I just urge the Minister yet again to look at how the measure will work in practice, and really deliberate on ways in which we can at least look at pilot schemes to see how it will work.

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[Dr Drew]

We need some lawyers in England, but we will need some multilingual lawyers when it is a matter of England and Wales. That is an absolutely fair point, and perhaps the Minister will want to intervene on me to give clarity—or not, as the case may be.

[George Eustice]

I must apologise for missing my hon. Friend’s important point, which links to a number of others that have been made about how we treat cross-border applications. In effect, what we will be doing is putting in place administrative agreements with Wales and the other devolved Administrations to ensure that where we have cross-border farms—we have similar arrangements in place now—we will have an agreement about how to approach these things to make sense of them and to ensure that things are done in a joined-up way.

[Dr Drew]

Whatever is happening with England and Wales, we have Scotland and Northern Ireland. This is going to be quite a complicated issue. There will be farmers in Northern Ireland who farm on both sides of the border; they will have whatever the common agricultural policy is and whatever the Northern Ireland policy is within the framework of the United Kingdom policy. That will greatly determine what they intend to farm, how they intend to farm and whether they wish to stay in farming.

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[George Eustice]

I will try to be as brief as possible. Amendment 77 repeats the earlier debate on clause 6, which also proposes a negative resolution. For the same reasons, we believe that a negative resolution is appropriate in this case, because it deals with technical issues and the switching off of certain requirements that currently sit in the scheme to try to improve it, simplify it and remove some of the frustrations that we have at the moment. That should be seen in the context that this is a time-limited scheme anyway, which will expire at the end of the transition.

I note what the hon. Member for Darlington says about the term “simplifying” or “improving”; I know the Lords Committee that looked at this also raised that point. We have not quoted the Agricultural Act 1947 today, but I know many hon. Members like it, so let us look at section 1, which talks about the importance of

“a stable and efficient agricultural industry capable of producing such part of the nation’s food and other agricultural produce”,

as it is deemed “desirable to produce”. Now, if I had drafted a clause along those lines and put it in, everyone would have said, “What does ‘desirable’ mean? What does ‘stable’ mean? What does ‘efficient’ mean?” The truth is that we can have false precision on these things. It is clear what we mean by “simplifying” and “improving”.

We should also view this in the context of subsection (2)(a), which is simply the power to switch off certain provisions altogether. It is very clear in the context of subsection (2) that our preference will be to switch off things altogether where they serve no purpose or we think we can do without them, but where we think they serve some purpose we can simplify and improve them. That is understood.

I should also say that we have to understand that at the moment, the best that Parliament will get on things such as this is an explanatory memorandum, explaining the latest thing that the EU has done to us. Most of these sorts of decisions are made by EU delegated acts. There is literally no democratic input at all on some of those requirements, and often things get made up on the hoof by EU auditors working for the Commission, who create all sorts of new processes that have not been discussed or agreed at any level within the European Union.

This is an approach that I believe is right. To explain the types of things that we want to deal with here, I have to deal as Farming Minister with something called RPA appeals. Every month I get a bundle of cases in my box that are farmers who maybe missed a deadline because something got lost in the post or there was a problem with their application form. The system is hideous; I have spent hundreds and hundreds of hours wrestling with lawyers in our Department to try to find a way of doing what is just and fair and finding in favour of farmers, only to find, all too often, with deep frustration, that EU law does indeed require me to find against them. The system we have in the so-called horizontal regulation is manifestly unjust and unfair, and we must resolve to improve it.

I turn now to the hon. Lady’s amendment 78. She explained her approach in great detail, but let me just say that she rather undermined her own argument by pointing out that DEFRA, without any statutory requirement necessarily to do so, is quite capable of churning out a great many consultations. I can tell her that, more often than not, the conversation I have with our officials is, “Do we really need a consultation on something as small as this?” and the answer is invariably, “Yes, because that is what Cabinet Office guidelines require.”

I do not believe that we need a statutory requirement to have a consultation on this. The only area where we have a statutory requirement for a consultation in the DEFRA field is on issues of food safety, where there is a written statutory requirement always to consult, but that does not stop us consulting. We consult on everything, and if it would give the hon. Lady some reassurance, I can give her an assurance, here on the Floor of the Committee, that we would consult on the changes that we intended to make under clause 9.

I would envisage our having a single strike at improving the system and probably not changing it much beyond that. It is inevitable that we would issue a consultation on all the changes that we would seek to make, and we would try as far as possible to do everything in that one go. It might be the case that there was something we missed and at a later date we might want to do a less formal type of consultation, but I take the opportunity here in this Committee to give the hon. Lady an assurance that we would consult on that first major batch of changes that we would seek to make, but we do not need to be forced to do so by a statutory requirement—as I said, we are quite capable of doing that anyway. I hope on that basis that the hon. Lady will withdraw amendment 77 and we can prepare to adjourn.

[Jenny Chapman]

I have listened carefully to what the Minister has said on amendment 78 and I accept, I think, what he is trying to say. I think he has tried to assure the Committee that there will be some kind of process put in place, so I will ponder that. I might return to that, but what he said was very helpful. In the interest of consistency, I feel I need to press amendment 77.

Question put, That the amendment be made.

Agriculture and Fisheries Council

George Eustice Excerpts

Thursday 1st November 2018 Written Statements

[The Minister for Agriculture, Fisheries and Food (George Eustice)]

Agriculture and Fisheries Council took place in Luxembourg on 15 October. The UK was represented by Katrina Williams, deputy permanent representative to the EU, and Rory O’Donnell, agriculture counsellor.

The main focus of the Council for fisheries was a regulation on fixing the fishing opportunities in the Baltic Sea for 2019, for which a political agreement was sought. Additional scientific advice for 2019 was presented and the deal received unanimous support from member states.

There was also an exchange of views on the EU-Norway annual consultation for 2019. The Commission highlighted the 2019 deadline for full implementation of the EU landing obligations and the 2020 deadline for all EU stocks to be fished at maximum sustainable yield. The UK mentioned the importance of maximising inward trades of fish species to help mitigate potential “choke” problems in the North Sea in 2019.

During an exchange of views on the annual meeting of the International Commission for the Conservation of Atlantic Tunas (ICCAT), some member states supported a move within ICCAT to progress the bluefin tuna recovery plan into a management plan. Commissioner Vella agreed with greater participation of small scale fishers but made it clear that the existing controls should remain in place.

For agriculture, the main item that was discussed was the progress report on the regulation on CAP strategic plans. Member states supported the new delivery model in principle but discussed making some of the requirements optional. In response, the Commission pointed out the importance of ensuring a level playing field.

The Commission debriefed Council on the G20 agricultural ministerial meeting that took place in July, highlighting that the conclusions reflected the EU’s position.

The presidency updated Council on the outcome of the informal process to identify a single EU candidate for the next Director General of the food and agriculture organisation of the United Nations (FAO).

A number of items were discussed under “any other business”:



The Italian delegation raised an item about the state of the European sugar market

The Spanish delegation informed Council of the upcoming electoral round for the Director General of the international organisation of vine and wine (OIV)

The Commission gave an update on the state of play with African swine fever (ASF). An informal ministerial meeting on ASF will be held in the margins of the AgriFish Council on 19 December.

[HCWS1056]

International Whaling Commission

George Eustice Excerpts

Thursday 1st November 2018 Written Statements

[The Minister for Agriculture, Fisheries and Food (George Eustice)]

I was unable to attend this year’s meeting of the International Whaling Commission (IWC67) on 10-14 September 2018 in Brazil due to pressing commitments in relation to the UK’s exit from the EU. However, a strong UK delegation was present.

This meeting was particularly challenging, with a number of complex and controversial proposals tabled. These included a significant challenge to the long-standing moratorium on commercial whaling. However, I am happy to report that all UK objectives for this meeting were achieved and the strong global protection in place for cetaceans was maintained.

As always, the UK delegation worked tirelessly behind the scenes, supporting the EU presidency, analysing proposals, brokering compromises, and influencing crucial decisions, all with the aim of securing improvements to the conservation and welfare of cetaceans.

The UK also ensured its long-standing opposition to commercial whaling and whaling under special permit (scientific whaling) was made clear at every appropriate opportunity. As always, there was the need for careful diplomacy, with the UK working hard to ensure dialogue remained constructive and respectful despite the fundamental differences in views.

Of particular importance at this meeting was resisting the proposal by Japan to restructure the organisation to allow for the resumption of commercial whaling. This complex proposal sought to create a new whaling committee within the IWC to oversee a return to commercial whaling on abundant whale populations and relax the voting rules for amending the convention’s schedule (which contains the provision establishing the moratorium) from a three-quarter to a simple majority. The UK worked extremely hard on defending against this proposal, leading the co-ordination with like-minded countries to ensure a coherent and well aligned strategy. I was therefore extremely relieved to see that the proposal failed to secure sufficient support and that the critical commercial whaling moratorium remains in place. The UK will now use the intersessional period to reach out to countries on both sides of the debate to ensure that constructive engagement within the IWC is maintained.

I am pleased to also report that a number of other important agreements were reached, in particular with regards aboriginal subsistence whaling (ASW) which was a challenging but important proposal and one that the UK had been engaging closely on for several months prior to the meeting. The proposal sought to renew, and in some cases increase, quotas for indigenous communities reliant on whales for subsistence purposes. In addition, it also introduced expanded carryover provisions to allow greater flexibility for hunters and a mechanism to automatically renew quotas without the need for the IWC to discuss and agree providing the scientific advice was favourable and there were no substantive changes to the hunt or subsistence need. After a series of complex negotiations within which the UK was centrally placed, an eventual compromise was reached, a compromise that protects indigenous communities’ access to food, reducing the stress and uncertainty associated with returning to the IWC every six years to request food for their families, but crucially balancing this by ensuring the IWC maintains its important oversight role and protecting its decision-making power in the event that the status quo situation of the hunts changes. I am extremely pleased by this landmark decision for the IWC which clearly demonstrates the maturity and functioning nature of the organisation.

I was also encouraged to see a number of important decisions taken on tackling important threats to cetaceans, in particular the passing by consensus of resolutions on underwater noise and ghost gear. The Florianopolis declaration also passed following a vote, delivering a clear statement from anti-whaling nations on their vision for the future of the IWC; one that is rooted in conservation without the need for commercial or scientific whaling.

Important progress was also made on further modernisation of the organisation through institutional and governance improvements. An intersessional process was established to bring forward recommendations and develop a programme of work in time for the next biennial meeting in 2020. The working group tasked with delivering this will be chaired by the USA, with the UK taking on an important role as Vice Chair.

I was pleased to see how the discussions on special permits progressed following the report of the intersessional working group established by resolution at the previous biennial meeting. The UK participated in this group, expertly chaired by Australia, which delivered for the first time a clear and concise summary of the advice of the scientific committee and proposed conclusions for the IWC to adopt. Despite disagreements from pro-whaling nations, the IWC meeting report will reflect these conclusions as representing the view of the commission, with a statement opposing from those that disagreed. This represents a good outcome and for the first time provides significant clarity of position for the IWC on this matter.

Once again I am pleased to report that the UK, in line with the agreed position of EU member states, voted in favour of establishing a South Atlantic whale sanctuary. Unfortunately the proposal failed to gain the three-quarters majority required for adoption. I expect this proposal to be re-tabled at the next meeting in 2020, which, in the absence of any other offer, will be hosted by Slovenia.

Finally, I was pleased that the UK led work to develop a tool to assess the welfare implications of non-hunting threats to cetacean welfare and efforts to further strengthen the conservation work of the IWC received endorsement. We will continue working closely with NGOs and academia to maintain momentum and continue to deliver improved conservation and welfare outcomes for cetaceans.

In conclusion, despite the significant challenges faced at this meeting, this can be viewed as a success. We now turn our attention to the intersessional period and, following our successful nomination to the IWC bureau, begin building for the 2020 meeting. Integral to this will be our continued close working with civil society in delivering our shared goal of improving the conservation and welfare of cetaceans globally.

[HCWS1055]

Agriculture Bill (Seventh sitting)

George Eustice Excerpts

Thursday 1st November 2018 Public Bill Committees

[Dr David Drew (Stroud) (Lab/Co-op)]

I beg to move amendment 84, in clause 2, page 2, line 27, at end insert—

‘(3A) It shall be a condition for receipt of financial assistance under section 1 that the person in receipt can demonstrate that—

(a) their existing and proposed land or livestock management practices, or

(b) their proposed land or livestock management practices;

meet any regulatory standards specified by the Secretary of State and which are in force at the time that the management practices are carried on.

(3B) The regulatory standards specified by the Secretary of State under subsection (3A) may (among other things) include standards relating to—

(a) health or welfare of humans, livestock or wild creatures,

(b) soil health,

(c) air quality,

(d) quality of water in any inland waterway.’

This amendment would require the recipients of financial assistance for the purposes in clause 1 of the Bill to demonstrate that their existing and proposed land or livestock management practices meet minimum regulatory standards.

I am pleased to serve under your chairmanship, Sir Roger. We shall try to make more speedy progress today, but a number of issues are important, and I hope that the Government will be able to respond and at least put our minds at rest. If not, we shall do the obvious and force the Committee to Divisions.

This amendment is in many respects wider than amendment 71, which we have already discussed, so I shall not go through a lot of the same arguments. The amendment looks at an issue that we feel strongly about in the Opposition: the regulatory framework, and how and why people will be paid for what they do. It involves the health and welfare of people and animals, wildlife, and how we look after the land—soil health, and air and water quality.

From the point of view both of proper management of public money and of ensuring the environmental benefits, it is important for us to establish what we mean by bad baseline practice. In our own minds, we might know that it is when we go to farms or to visit others who look after the land and see things that we would not want to see, but we need to say something about it in this legislation.

On Tuesday, the Minister talked about some of the things that will inevitably follow, such as how we move from existing cross-compliance in the common agricultural policy into environmental land management contracts, but we were a little surprised by how open-ended those were. More particularly, we are not sure who these countless individuals going out to advise are, or where they will come from. Furthermore, if farmers or—dare I say it—people in general are left to their own devices and self-regulate, who checks the self-regulation? We want to tease out some of those big issues.

The Minister tried to reassure us about some of the checks and balances, but we are still not sure about how things will work in practice. That will be a continual theme in what we say today. What do the measures mean to the people to whom we are potentially giving money, and what do we expect them to do for that? If they do not do it, what happens? Clearly, some people will use bad practice or fail to meet minimum standards.

The Government said in their policy statement that they intend to be “firm and fair” in their approach to regulation. We await the final report of Dame Glenys Stacey—we have the interim report—but some of us would have liked to have heard from her in the evidence sessions, because it is important to know what she has in mind for recommendations on how regulation will work. Perhaps the Minister will give us some insight about where Dame Glenys is going.

More particularly, on animal welfare, we need to know a bit about safety records: who keeps them? How will those records be accessible and by whom? Otherwise there will be no real clarity. The point also applies to air and water quality and to soil health.

From the Government, as a result of “Health and Harmony”, we have the policy statement—I will not read it all out, but it is quite revealing. It talks about a “changed regulatory culture” and says:

“We will maintain strong regulatory standards and introduce a new approach to monitoring compliance and enforcement. We will adopt a more streamlined and focused regime, with more data sharing, reduced duplication and greater use of ‘earned recognition’,”—

I will ask the Minister to tell me what he thinks “earned recognition” is, because I am not completely sure—

“which received strong support in the consultation. ‘Earned recognition’ may take account of historic compliance and membership of industry assurance schemes, where there is confidence that the scheme enforces regulatory standards.”

It goes on about the idea of “firm but fair” and the fact that it will be reliant on what comes out of the Stacey review.

Our problem is that a lot of these things are in play—the Bill is also being scrutinised by the Environment, Food and Rural Affairs Committee and the Scottish Affairs Committee—but we are doing the legislation. There is a degree of, “Which comes first?”, and it would be helpful if we had had some of that evidence so that we could make a better job of holding the Government to account. How will it all work, particularly the idea of earned recognition? Who will achieve that? Who will monitor it, and when it is not acceptable, what do we do about it?

[The Minister for Agriculture, Fisheries and Food (George Eustice)]

It is a pleasure to begin the day by responding to this particular amendment. At its heart is an attempt to put into the Bill a requirement to have something akin to the existing cross-compliance regime. I will come back to that later.

There are two key points I would make about the amendment. Clause 2 and clause 3, which we will come to later, as already drafted, make allowance and provision for a Government to create such conditions through an affirmative statutory instrument should they feel that that is the right thing to do. Under clause 2(2) it is open to the Government to say that there are conditions attached to entry into these schemes and that there may be, under clause 3(2)(g), penalties for breaches of the regulatory baseline.

There is already an option, given how the Bill is drafted, for a Government to bring forward proposals of that sort through an SI. My argument is that the detail spelled out in amendment 84 would be the appropriate level of detail that might be in a particular SI brought in under, for instance, clause 2, and probably addressed through anything brought in under clause 3 as well. We could do that, if we wanted, through the SI and that would be the appropriate place to do it.

However, my general view is that we should separate out as far as we can the regulatory baseline, which should apply to everyone equally whether they are in or out of a scheme, and conditions that we attach to financial schemes to support farmers to go above and beyond that regulatory baseline. The danger of the amendment here, as I see it, is that the very first thing it says, in 3A, is:

“It shall be a condition for receipt of financial assistance…that the person in receipt can demonstrate”,

that they abide by all those things.

We want people to feel good about entering these schemes. When a farmer phones up the Government, Natural England or whichever agency is administering the scheme to say, “I am really keen to enter your new agri-environment scheme,” if the first thing that happens is that they say, “Well, we’ll send out an inspector from the Rural Payments Agency with a clipboard to try to find fault and see whether your ear tags are wrong, or there is a trivial problem of that sort that will disqualify you,” it will put people off entering the scheme.

We already have this problem with the cross-compliance regime. I explained on Tuesday that, having wrestled with the cross-compliance regime as a Minister for five years, I can confirm that it is completely dysfunctional. The regulations set out in EU law and the penalty matrix mean that incredibly disproportionate penalties are sometimes applied to farmers that have no bearing whatever to the scale of the breach in question.

We already have problems with, for instance, large arable farms that might have a small pedigree herd of cattle that they keep going as a labour of love. If they have some trivial ear tag problem—an ear tag goes missing and they have not managed to replace it yet—and are unlucky enough to be inspected, they can end up with penalties of £40,000 or £50,000 for such small things. I remember many cases in this area. I remember a farmer who once had a dispute with his neighbour. The neighbour padlocked the gate on the footpath, and the farmer ended up with a £45,000 penalty, such is the nonsense of the existing scheme.

We do not want to replicate that. The danger of accepting the amendment is that a trivial error or mistake on something like an ear tag could lead to somebody’s complete disqualification from entering a scheme, or to an onerous financial penalty that would not fit the breach incurred. Something of this type could be introduced through an SI under the Bill’s provisions, should someone wish to. We should abide by the principle that regulations apply to everyone, that we should not have more inspection on people who enter schemes than those who do not, and that inspection regimes should be consistent and apply to people across the board, whether or not they are in a scheme. For those reasons, the amendment is not appropriate.

The hon. Member for Stroud asked about the Dame Glenys Stacey review. That is now well under way. She is keen to move to what she terms a better, more modern approach to regulation, in which things are better joined up and there is less reliance on an arbitrary rulebook, with people coming around with clipboards and ticking boxes. She wants a more holistic approach to the way we manage compliance on farms and a better understanding of, as I explained on Tuesday, the grey area between incentivising better husbandry and good practice, which can go a long way to achieving environmental and animal welfare outcomes, and accepting that a clear regulatory baseline must be enforced.

We are keen to start moving towards a different culture around regulation that is less about a complex rulebook, which often has lots of unintended consequences and disproportionate penalties, as characterised in our current scheme. We want it to be more about discretion for officers on the ground, whether they be from Natural England, the Rural Payments Agency or the Animal and Plant Health Agency, to exercise judgment in respect of a given farm, and about having a better understanding of the linkage between things that we can incentivise to get better outcomes and the need to adhere to the regulatory baseline.

[Jenny Chapman (Darlington) (Lab)]

I am interested in what the Minister says, and he makes a fair point. However, my concern is that this scheme needs to be transparent, fair and rigorous in the eyes of taxpayers. As we said on Tuesday, the closeness of these decisions will change, and taxpayers will want to know that their money that goes to this scheme, and so not on policing, health or other important issues, is carefully spent, and that the scheme is robustly inspected and monitored. We need to be careful about where that balance lies.

[George Eustice]

I understand that. As I said on Tuesday, we accept the “polluter pays” principle. It is important that we have a clear regulatory baseline. At the moment, in areas such as livestock ID, we have a hotch-potch of different regulations that have come from the EU, and there is lots of inconsistency. We have an opportunity as we leave the EU to tidy up the rulebook and to have a clear and consistent regulatory baseline, and to then build on that with financial incentives.

--- Later in debate ---

[Mr Robert Goodwill (Scarborough and Whitby) (Con)]

My hon. Friend the Minister has mentioned the issue of ear tags, but we also potentially have the problem of sprayers that may have missed their annual MOT. When the sprayer ultimately comes for its test, it may well have been compliant all the time, but according to this amendment that farmer could be ineligible for payments. Perhaps the guy who was going to do the test was ill that day and the farmer ran out of time.

[George Eustice]

There can be lots of issues like that.

[Jenny Chapman]

That is a completely wrong analogy. The right analogy is perhaps with the financial support given to parents. If parents do not comply with the rules and the terms of that agreement with the Government, then the finances are removed and they might even find themselves going to prison. It is a completely different situation and it appears to me that the Minister—with the best will in the world—is making this up as he goes along. It is like, “We could do this, we could do that, we might do something else”. I do not get the impression that the Government have properly thought this through.

[George Eustice]

I disagree; I have thought it through. If the hon. Lady and a future Labour Government want to do precisely what they set out in amendment 84, the right place to do it would be under an affirmative resolution under sections 2 or 3.

[Mr Goodwill]

Perhaps I should clarify something for the benefit of the Opposition. I am not talking about the Ministry of Transport MOT, where people take their car to the garage; I am talking about the annual testing that sprayers must undertake as part of cross-compliance and as part of the schemes that farmers engage in. Indeed, slug pellet applicators need to be tested every five years, so it is quite possible that a farmer would forget when that five years was up.

[George Eustice]

My hon. Friend makes a good point. There is a complex issue around sprayer MOTs, as he knows, because there is a voluntary industry scheme underpinned by Red Tractor. The vast majority of farmers are required to do that as a condition of their Red Tractor membership.

I have come across examples. For instance, we have a cross-compliance rule that there needs to be a 2-metre buffer strip around fields. I have come across examples where in one small corner of the field the person doing the rotavating or operating the plough drifted slightly in, so that the width went to 1.80 metres instead of 2 metres. A farmer in that particular case received a fine of £10,000. That is clearly disproportionate to the scale of the offence and it is the kind of nonsense that we now have an opportunity to sweep away.

[Sandy Martin (Ipswich) (Lab)]

Clearly, we need sensible regulations and sensible compliance arrangements. However, is it not part of the problem here that if we have a regulatory regime that relies solely on inspectors rather than on incentivising farmers through the financial payment system, there will never be enough inspectors? Regulation is not as effective as affirmative action and that is what the whole support system is meant to be; it is meant to be affirmative action. In which case, surely we should expect people to meet the regulations, to gain the benefit of the affirmative action.

[The Chair]

Order. Just before we proceed, I must say that I am rather hoping to be home for Christmas. I would really like interventions to be interventions and not speeches.

[George Eustice]

I thought for a moment that the hon. Member for Ipswich was going to support me. I agree with the first part of his intervention: we want to recognise that there is a limit to what can be achieved by a regulatory base. What we are trying to do through clause 1 is to create schemes that incentivise farmers to go above and beyond that, while clauses 2 and 3 will put in place the enforcement regime to support those areas.

The hon. Gentleman makes a good point. Under the cross-compliance regime, the average inspection level is about 3%, so let us not exaggerate the extent of it. It is something of a lottery whether a farmer gets a visit from the RPA; one visit in 33 years is fairly typical. My disagreement with him is on the basis that if we have a regulatory baseline, we should enforce it consistently on everyone, whether or not they are in a scheme. Under his amendment, the inspection rate would be 100% for anyone in a scheme, while anyone who chose not to be in a scheme would not receive the same level of inspection. In my view, that would be inconsistent.

I hope that I have reassured the hon. Member for Stroud that the objectives of his amendment could be achieved under clauses 2 and 3 through an affirmative statutory instrument, or through the terms of any contract entered into under clause 2. Agreeing to his amendment would be unnecessary and counterproductive, so I hope he will withdraw it.

[Dr Drew]

I will not press the amendment to a vote, but only because I am even more confused now than when I moved it. Notwithstanding the issues that we have raised and that the House of Lords has already waxed lyrical about, the Bill relies far too much on SIs to underpin it. The Bill may be a scaffold rather than a building, but at the moment we do not even have the bits of the Meccano set in the right place.

We need more detail on how the Bill will work in practice. The Minister is saying that we will be doing other things, but all the examples that he falls back on are effectively about cross-compliance. If Dame Glenys Stacey comes up with a better way of doing things, let us hear about it, but the problem is that we are passing legislation on the basis that she will. We do not know that, so we are giving a hostage to fortune.

Notwithstanding our unhappiness with the Rural Payments Agency—as the Minister says, it does not go on to farms very often, and when it does it sometimes goes over the top, which can be very unfair—who is going to do this? Who is going to carry out this affirmative action, to use the words of my hon. Friend the Member for Ipswich?

The Minister did not explain what earned recognition was. I think it needs to be defined in the Bill, because it is a central point.

[George Eustice]

I apologise for missing that point; I was taking a steer from Sir Roger that he wanted to make some progress.

We already have a concept of earned recognition. It is already provided for in EU regulations, and we already have an approach whereby somebody who has signed up to the Red Tractor scheme is put into a low-risk category when the selections for inspection are run. That follows a principle that we have advanced for many years, which is simply that if somebody goes to the effort of signing up to an accredited scheme, it shows that they are already abiding by higher standards. If they are already subject to inspection by the Red Tractor accreditation scheme, for instance, it is less necessary for the Government to inspect them. It is a good principle and we want it to continue.

[Dr Drew]

That is very good, but why is it not in the Bill? The Bill needs to spell out very clearly the process by which this will operate. I would be happy to agree to a Government amendment or new clause that spelled out what earned recognition is, because it is fundamental. If it is going to bolster the way in which environmental land payment contracts are made operative, let us put it in the Bill so that everybody knows what they are dealing with. We would have to be careful about the wording and how it operates in practice, but that is what legislation is about. If we are using a term that—dare I say it—is being taken from the EU, why is that not in the Bill?

I shall not press this amendment to a vote, but the Government need to do some real thinking about what needs to be in the Bill to give the people who have to operate under it—farmers and others—knowledge of how they will be able to earn support payments and, if they do not do things as we want them to, what action the state will have to take. At the moment, I am none the wiser. The Government need to go back and define the terms, to say how the different mechanisms will work. We would then be much happier. The Government need to do some thinking. I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Dr Drew]

I beg to move amendment 98, in clause 2, page 2, line 31, after “delegate” insert “administrative”.

This amendment would ensure that the actual design and purpose of schemes is not delegated to non-governmental bodies or organisations.

I hope to make quicker progress on this amendment, which is in my name and that of other hon. Friends. It is meant to tease out who will benefit from the new delegated functions. As drafted, Ministers may delegate functions to any other person. In theory, therefore, the design and process could be delegated to anyone. Although this will be a short speech, we feel strongly that the clause could lead to distortions across the country and result in a postcode lottery.

These advisers, who are going to be invented—we hope they become a reality sooner rather than later—will have to interpret the Bill and decide who is, in effect, there to work with the people who want to receive the payments. The idea is that only those administrative functions can be delegated, but will the Minister spell out more clearly what is meant by the delegating process? For example, which Government agencies are involved? I keep going on about this, but we did not have the opportunity to hear evidence from such agencies, and one of the questions that we would have asked was about where they see themselves playing a role. We tried that with the Food Standards Agency, which basically said, “Nothing to do with us, guv.” Other agencies must therefore be more responsible for the operation of the Bill.

Will the Minister simply set out the process for delegation to those agencies? Will he name the agencies? That would be helpful, given that they will inevitably have to overlap. At the moment, Natural England’s functions have been subsumed into the Rural Payments Agency, but there are other agencies—trading standards still go to farms and look at various animal health issues. It would be useful to know from the Minister how he sees all that working.

[George Eustice]

I am grateful for the opportunity to explain what we intend to do under clause 2(5) and also under clause 2(4), which is of relevance as a linked power. The issue is connected with something the hon. Gentleman highlighted earlier in our debates on clause 1: how we intend to administer a scheme in which we might have individual-level farm contracts. He has often expressed scepticism about the Rural Payments Agency and its suitability for the task. As the Committee knows, I have always defended that agency, because I know what a hideously dysfunctional EU system it has to operate in.

That said, what we seek to achieve with subsections (4) and (5) is as follows. We want to move to a new system with these contracts, so that a human being—an individual expert agronomist or an expert in ecology and environment—can visit a farm, walk it with the farmer and help him put together an environmental plan for his own individual holding, taking account of soil type, farming practices, the water catchment area he is in and so on. Once they have helped the farmer put together the scheme—perhaps sat around the kitchen table—the agreement can then be passed to a Government agency for approval.

--- Later in debate ---

[Martin Whitfield (East Lothian) (Lab)]

On a point of clarity, and more to put it on the record than anything else: there is no intention for any of the delegation to go beyond England and affect any of the devolved nations, is there?

[George Eustice]

No, this is a power for England only, and it will be for each of the devolved Administrations to decide how they want to design their enforcement and management process.

[Mr Philip Dunne (Ludlow) (Con)]

I thank my hon. Friend for the clarity with which he has laid out for the Committee the Government’s intent regarding the implementation of the new scheme through accrediting bodies, and that is extremely helpful for the Committee to understand. While I recognise that this will be a new scheme with much more streamlined implementation and systems, we have significant problems with the existing countryside stewardship and environmental stewardship schemes administered by the Rural Payments Agency. If we are to persuade farmers to enter into new schemes, they must have confidence that the current schemes, where we have outstanding disputes and a lack of full payments being made under many of them, will be ironed out. If they are not, farmers will be increasingly sceptical about the prospects of a new scheme being introduced under these powers.

I am straying slightly beyond the purpose of the amendment, but I urge my hon. Friend to encourage the Rural Payments Agency to get existing schemes fully paid up. As at the middle of October, DEFRA’s statistics show that 751 countryside stewardship agreement holders, or 15%, have not been paid their final 2017 payment, while 8,116 environmental stewardship agreement holders, or 33%, have yet to receive their final payment. Please could he help to get a welly on?

[George Eustice]

I am grateful to my hon. Friend for that intervention. I intend to address those issues in more detail when we get to part 2, because clause 11, in particular, gives us the power to modify the existing EU schemes. As I pointed out earlier, the difficulty that both the RPA and Natural England have with these schemes is the dysfunctional nature of the enforcement regime designed by the EU that sits behind them. We have an opportunity to clean that up once we leave the EU.

[Mr Goodwill]

My hon. Friend mentioned national organisations such as the RSPB. Does he see a role for local wildlife trusts? There are 47 up and down the country, including the Yorkshire Wildlife Trust, which currently not only manages 100 wildlife reserves but works closely with farmers to help them manage their land, and would, I think, like to work more closely with more farmers.

[George Eustice]

Absolutely. I am a huge supporter of the work of the wildlife trusts; we have one in Cornwall that does some good work. They often have local knowledge and very good working relationships with farmers because they are less of a campaigning organisation and more on the ground. There could well be a role for them. The purpose of clause 2(5) is to make provision for us to be able to engage some of those third sector organisations, and even independent agronomists farmers trust, so that we can design tailored local schemes.

Although the amendment is not pertinent here, I will briefly touch on clause 2(4) because it is a linked issue. It gives us the power to give financial assistance to an organisation that would administer a scheme directly. To be clear about the type of thing we have in mind, because it is a similar provision, the national parks have said that they would quite like to run a scheme for their members and administer the financing of that by delegating it down. There are some good examples, such as the Dartmoor hill project, where we have that kind of landscape-scale working around organisations such as national parks.

Local enterprise partnerships have expressed an interest in being involved in the administration of productivity grants. We want to have the option to subcontract some of that work, where it is appropriate, to bodies such as local enterprise partnerships or national parks. Again, that could assist in ensuring that these schemes run smoothly.

[Sandy Martin]

Can the Minister rule out management consultants, accountancy firms or generalist companies such as Carillion from administering any such scheme?

--- Later in debate ---

[George Eustice]

That is not our intention at all. Anyone who knows me knows that I am not a big fan of management consultants. I often come across very talented local agronomists who really understand the landscape and the soil type. If we set them free and gave them the opportunity to work in partnership with farmers, the schemes would work far more smoothly than in the central, bureaucratised system that we have now.

[Jenny Chapman]

The Minister is asking us to believe that a scheme will administer substantial amounts of public money and will be run by some very impressive and worthy organisations—LEPs, national park authorities and the RSPB. Can he point to any other area of public policy or significant Government spending where that kind of approach is permitted?

[George Eustice]

It is permitted now. The Soil Association can authorise organic farmers, and there are a number of other accreditation bodies.

[Jenny Chapman]

They are not spending £3 billion.

[George Eustice]

If someone is accredited as a member of the Soil Association, they are able to claim a top-up to their basic payments scheme. So, yes, there are areas. In terms of clause 2(5), there is already precedent for that in the way that the EU schemes operate—EU regulations create the power for that to happen. We think it is a good model. Engaging people such as the Soil Association in some schemes could be really powerful.

Likewise, if we are to move to a system where we may want to pay farmers who sign up to something like an RSPCA-assured scheme or another scheme, it is important that we have a legal basis to be able to recognise those schemes. They will have to be UKAS accredited—we must have confidence in those schemes. UKAS has existed for many years. The last Labour Government introduced UKAS-accredited schemes in many areas. It is a successful model.

On that basis, I hope I have been able to reassure hon. Members that our intention in clause 2 is to address a concern that the shadow Minister raised earlier in the debate about how we will administer these schemes. I hope, therefore, that having put down this probing amendment, he will withdraw it.

[Dr Drew]

We will not push the amendment to a vote. I go back to what the Minister said. Who pays? Agronomists do not come cheap. I have a love for the Soil Association, which is down the road from me in Bristol, and for the RSPB, and I am a member of the Wildlife Trusts—I suppose I should have said that some time ago. They are very good organisations and they do very worthy work, but we are shoehorning them into the process. If this is the advisory role, with the best will in the world they will need to be paid for that. We could say, “Okay, we are taking the basic payment away, and we have therefore got something of the order of £2 billion to play with,” but that money will go very quickly when farmers sitting round the table are talking to the people in question. They will be charged quite large sums of money to get the environmental land management contracts together in order to get their earned recognition.

I ask the Minister to think a little bit. Yes, there is good practice out there—of course there is; but that is good practice working within an existing, well-known and well-regulated scheme. What we are considering is going into the unknown. I ask the Minister to dwell on the thought that we need a pilot operation. We need to know that the Soil Association is willing and able to take the role on. It is additional to what the association undertakes at the moment. It deals with farmers who come to it, who get a sum of money to become organic. The proposal before us is really asking it to be part of the regulatory regime. It might not be a regulator as I would normally see it, being in more of an advisory role. Will the Minister commit to doing some pilot work, so that we know how things will work in practice?

[George Eustice]

If the concern is that we would not pilot, and that we are just going to make a leap of faith on this, I can give an absolute reassurance that we will not. There will be pilots, obviously. Using some of the third sector organisations in the way we envisage will obviously require them to have the capacity to do it. Organisations such as the RSPCA and LEAF—Linking Environment And Farming—run existing accreditation schemes and have commercial wings set up to help to do that. We would not be making a big departure, in a way, from what already exists; but it would be on a different scale, potentially.

Also, what is proposed could be part of the mix. It does not have to be the entire thing. It could be an option to be used in some areas, particularly where there were more holistic accreditation schemes; but, alongside that, other components of the scheme might be administered in a more conventional way.

Most farmers already have to spend a fortune on land agents to fill out EU forms and pieces of paper, and bits of mapping and RLE1 forms, and whatever other nonsense is required under the current system, in order to get any payment at all. So the vast majority of them already have to pay land agents to do a lot of work, and the feedback that I get from farmers is that they would far rather work with an agronomist to get things right than have to pay someone to fill out paper endlessly.

[Dr Drew]

I hear what the Minister says. That is a wonderful world. I am not sure whether it quite exists, the way I see it. I have talked to some land agents who are sceptical about whether their income-earning possibilities on the land are anything to really keep them there. There is a lot more money to be made in urban activity, so I urge some caution there.

To return to what the hon. Member for Ludlow said, it is interesting to consider the proposal working, but at the moment the countryside stewardship scheme is under a big cloud. LEAF is suffering at the moment because farmers are not coming forward. It will be a big job for the Government to convince them, so that they are willing to go through the process. Otherwise some will say, “We will just try to make money out of what we have always done”—which is farming. Whether they will or not is another matter. Obviously some sectors will do well and others less well.

Again, I shall be interested. At least we have an assurance from the Minister that there will be pilots. I hope that he will discuss them with us and make them accessible, so that we can see exactly what is going on. However, there are question marks. I shall not press the matter to a vote, but the Government need to think about which organisations should be involved, how those on the land are to be encouraged to go through those organisations, and who will pay.

It will be very expensive, at least in the early days, because it is going into the unknown. We are ditching the EU regulation and coming up with a new regulatory framework, but it is not there now, and it will involve an awful lot of people working together to make it possible. With that proviso, and a request that the Government will come back to us to explain how the proposal will work in practice, I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

--- Later in debate ---

[The Chair]

Order. There are two ways of doing this, so let us establish a precedent now and then follow it. The Minister may respond now before I call Back Benchers or, if he prefers, I can call the Back Benchers first and he can then respond to the entire debate.

[George Eustice]

I will come in at the end.

[Sandy Martin]

We welcome a method of incentivising farmers to do the right thing—I would argue that that is the thrust of the Bill—but it is entirely proper to include conditions for the receipt of any financial support. Otherwise, how can that incentive be effective?

Amendment 85 on waste food fits very well with our amendment 50 on greenhouse gas emissions, which was rejected on Tuesday. Methane is 23 times more potent a greenhouse gas than CO₂ and is the biggest contributor to climate change after CO₂. By ensuring that we deal with the issue of food waste, the amendment would help to ensure that we meet our climate change goals. There is no sense in targets that do not include methane.

Every part of the food production, consumption and waste stream needs to be part of any effective solution. If we do not include production in our food waste reduction strategy, it will not be effective. A strategy that includes targets and regulations to ensure that the incentives—the carrots—go to the right people at the right time is one that the hon. Member for Gordon will appreciate.

The reduction of food waste will help people to think more carefully about the food that they eat and therefore to move towards foods of higher quality and nutritional value. Indeed, in the Which? survey, 71% of people said that they preferred higher-quality food to price reductions. Reducing food waste will help food production in this country because it will produce greater profitability for better-quality foods in the long run. The totality of the funds available for buying food will go towards the production of food that people actually consume, rather than food that is wasted along the way.

--- Later in debate ---

[George Eustice]

The amendment deals with an incredibly important issue. As the hon. Member for Bristol East said, if we want to feed a growing population and tackle issues such as climate change, doing all we can to bear down on and reduce food waste is essential. I remember being at an OECD event where there was discussion around some of the African countries that have big problems with a lack of chill chain distribution, which can really affect food waste in their countries. It is a very important issue and I am going to explain what the Government are doing about it, but I hope that the shadow Minister will understand that I do not think the Bill is the right place to address it.

The UK is already leading the way in the EU and internationally on food waste. Food waste in the UK reduced by 14% per person between 2007 and 2015. We have seen a 19% reduction per person in the amount of food thrown away that could have been eaten. There have been some important changes. Food labels used to give the advice “freeze on day of purchase”, which made no sense and meant that people threw away food that could have been frozen instead. There has been a growing and better understanding of the difference between use by dates and best before dates, which means that people are willing to eat food that goes past its best before date because it is still perfectly good to eat.

At the Conservative conference, the Secretary of State announced a new pilot scheme aimed at reducing food waste further from retail and manufacturing, backed by a £15-million fund. The scheme will be developed over the coming months in collaboration with businesses and charities and will launch in 2019-20.

As hon. Members will know, the Waste and Resources Action Programme works closely with DEFRA. The Institute of Grocery Distribution also does some very good work in this area. Working with them, we have published a food waste reduction road map, which lays out ambitious milestones for food waste measurement that will be vital in achieving national policy objectives and targets on food waste reduction, including Courtauld 2025 and sustainable development goal 12.3. The Courtauld commitment, launched by WRAP and supported by DEFRA in 2016, is a commitment out to 2025 to see an ambitious reduction of 20% per capita in food and drink waste in the UK. The target already exists—it was set in 2016 by WRAP—and, as I have explained, we have made good progress already in the last 10 years.

Because we take the issue so seriously, further initiatives will be included in DEFRA’s forthcoming resources and waste strategy, which will be published later this year. The hon. Member for Stroud asked whether the food strategy will cover this issue. I can reassure him that before we get to the publication of the food strategy, we will have the publication of the resources and waste strategy, which will include a great deal of consideration of the issue of food waste.

Apart from the fact that the amendment is unnecessary because these important issues are being picked up through other Government initiatives, as my right hon. Friend the Member for Scarborough and Whitby pointed out, there is a problem in requiring the recipients of financial assistance to take steps to avoid food waste and the waste of food products. Food waste is often out of the hands of farmers. In evidence, George Dunn of the Tenant Farmers Association gave an example of a lettuce grower who had grown a crop in good faith, had cut the crop and was ready to sell it, and then the purchaser changed their mind at the last minute. He was left with a perishable good for which he had no market.

[Colin Clark (Gordon) (Con)]

The Minister reminded me of my carrot production—we grow them. It is not a carrot factory; we do not make them in a machine. If carrots get carrot fly or another disease, they have to be ploughed back in. If someone grows broccoli, they will grow various stages of broccoli, and some of those stages of broccoli will have to be ploughed back in. That is a decision the farmer makes—it is not because the supermarket rejects it. The food industry is a very advanced industry and for 30 years, we have been making use of the by-products. Putting this point in the Bill underestimates the fact that, particularly in vegetable farming, we grow a whole programme of vegetables and we may plough some back in. It is a by-product; it is not waste.

[George Eustice]

My hon. Friend makes an important point. I was going to turn to waste in the primary production area later.

To finish the point about contracts and fair dealing, we will deal with that at a later stage in the Bill and debate it. We will try to address some of the problems in the supply chain where perfectly good food goes to waste because it has the wrong label or a purchaser has changed their mind at the eleventh hour. There is a limit to what farmers can do to control such food waste in the supply chain. That leaves us with the question: where could they control waste? The answer, of course, is at the primary production stage.

As my hon. Friend the Member for Gordon pointed out, if a farmer grows carrots and has the great misfortune to get carrot fly, there is already quite a financial penalty without then having somebody come along and say, “Now we are going to take all of your financial assistance away as well, because you have had a problem with your crop and there is some waste.”

As some Members know, I worked in the farming industry for 10 years before going into politics. We used to grow winter cauliflowers in Cornwall. We used to pray for frost in Kent to kill the cauliflowers there and hope that we did not get frost in Cornwall. However, there were times when we had severe weather in Cornwall that devastated the crop, and we would have to rotavate the cauliflowers into the ground and plough them in. The financial penalty was considerable. I can assure hon. Members we never wanted that to happen, but occasionally it does.

Nevertheless, we have commissioned WRAP to do a study of waste rates in primary production. It will report on that later this year. The area is complex, as I said, because of the weather, pests and disease, which tend to be the main contributors to the waste, but WRAP is looking into that.

I hope I have reassured the hon. Member for Stroud that the Government take the issue incredibly seriously. We have made some progress in the past decade. We have targets already out until 2025, and we will publish an updated resources and waste strategy that will include food waste later this year.

[Dr Drew]

We will not press the amendment to a vote, so the Minister can breathe a sigh of relief. However, there are some reasons why we have identified the issue of waste here. If we do not identify it here, where do we identify it? Perhaps in time there might be a food strategy, which is a more appropriate place to put it, but it needs to be legislated on.

The Courtauld commitment is voluntary, so there is no real traction from Government. The problem is significant. It is estimated that 10% to 60% of production—equivalent to £0.8 billion—is on-farm food waste. It might get ploughed back into the ground, which might benefit soil nutrition and so on, but one hopes to see the food that we grow on people’s plates, otherwise it is not a good use of farmers’ time and it does not meet the consumer demand for the availability of plentiful food. There is a lot of work to be done in this area and we make no apology for saying that we will come back to it, whether that is in debates on this Bill or not. We will push for a food strategy, because we believe it is right for the Government to have one, and it must include a strong section on food waste. Without more ado, I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

--- Later in debate ---

[Dr Drew]

This will be quick. The amendment is about transparency and data protection. Of course, farming systems are currently entirely within the domain of the EU. It would be interesting to hear what the Minister has to say about what the new regime will look like, what data protection principles will be in place, what those who receive payments will be expected to do and what protections they will receive from the methodology that will be in place.

Amendment 100 would insert a new subsection requiring information specified under subsection (8) to be

“proportionate and limited to protect the interests of the individuals and businesses concerned.”

The NFU in particular wants to test that to ensure that farmers are not subjected to additional requirements and are assured that, if and when they partake in the schemes the Minister wants them to partake in, they will have additional protection in terms of the general data principles.

In some respects, the amendments just look at how the General Data Protection Regulation applies to the Bill. I am asking the Minister to say that it applies, but that it will not in any way be a more onerous set of tests, and that those who have to provide information about what moneys they receive can do so in the knowledge that that information will not always be made available to everyone and that its provision will not undermine their business. Will the Minister say something about that? Again, we will not necessarily press the amendment to a vote at this stage, but it is important that we know the Government’s position.

[George Eustice]

We seek to roll over a power and a practice that exists under the common agricultural policy. As many hon. Members know, there is already complete transparency about the recipients of payments under the CAP. That information is already publicly available, and there may be such information that we want to continue to publish. The public would not understand if we continued to make public payments but a veil of secrecy suddenly surrounded them.

[Tonia Antoniazzi (Gower) (Lab)]

Will the Minister publish data for the devolved nations, too? A number of cross-border farms will be required to provide information.

[George Eustice]

I think this function relates to England, but it is underpinned by the GDPR and the Data Protection Act 2018, so there will be similar provisions for Wales. Perhaps I can clarify that later. If someone has the wherewithal to read schedule 3, I think they will find that it contains similar powers for Wales. I am sure I will be able to clarify that before I finish speaking.

I reassure the hon. Member for Stroud that the GDPR will apply. In response to that European directive, the UK Government passed the Data Protection Act 2018, which implemented the requirements of the GDPR. Under that Act, it is already the case that we would need to demonstrate when laying the statutory instrument that established powers to publish such data that its publication was necessary and proportionate. The requirements of the Data Protection Act will apply as they do now to the data we publish under the common agricultural policy. Amendment 99 is therefore unnecessary.

To publish any data at all, we would need the legal power to do so, but before we could pass the statutory instrument and publish such data, we would need to demonstrate that its publication complied with the Data Protection Act, which implements the GDPR. I reassure the hon. Gentleman that any data we publish will be fully compliant with the requirements of the Data Protection Act 2018.

--- Later in debate ---

[Martin Whitfield]

A similar power is contained in the Northern Ireland schedule. What is the position with regard to Scotland for the chains crossing the border?

[George Eustice]

Scotland has no plan for its future agricultural policy. It will be for Scotland to ask us to add a schedule on its behalf or to bring forward its own legislation. A point was raised on Tuesday in a discussion on clause 1 whether we will make available details of how much money had been spent on delivering certain purposes. The answer is that, as well as publishing the recipients of support, this power would also enable us to publish the purposes and the broad intention of what we are delivering with that power.

[Jenny Chapman]

Representing a constituency in the north-east, I am mindful of the situation of businesses and farms that cross the Scottish border. Will the Minister help the Committee to understand what would happen if Scotland failed to ask for a schedule or do anything between now and exit day? What would be the situation of support for farmers in Scotland in those circumstances?

[George Eustice]

Scotland has one of three options: it can bring forward its own primary legislation or it could add a schedule. Its content could range from something similar to what Wales has done, which is a full suite of powers, or it could take the approach of Northern Ireland, which is broadly the powers to roll-over the existing scheme and make modifications but not to make changes beyond that. Finally, it could pass legislation or ask us to add a schedule that gave it the power to continue to make payments but nothing else—not even to modify. There is a range of options, but Scotland needs to do something and have primary legislation or its power to make payments will fall down at the end of 2020.

[Colin Clark]

To be absolutely clear, is there any legal framework in the EU (Withdrawal) Act that would cover Scotland to carry on make payments beyond a date? Would there have to be primary legislation?

[George Eustice]

Yes, that is correct. We may be straying into an issue that I will explain in more detail later under Government new clause 3. Although the basic payment scheme regulations come across through retained EU law, there is a natural sunset clause on the financial ceiling—the payment powers underneath it. Unless an amendment is put down to extend the financial ceiling, that power falls away. That is not addressed in the EU (Withdrawal) Act. At the very least, a single clause is needed to create a financial ceiling beyond 2020.

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

The Minister will accept that Scotland Ministers and Scottish Government officials dispute that fact and say that there is no problem at all with making payments after those dates, and that that will not be affected by this Bill.

[George Eustice]

That is what the Minister said. I am not sure that that position is shared by Scottish Government officials. It is a recognition that yes, they could bring forward some primary legislation, but they would need something. It could be quite a simple clause along the lines of what we will propose later, but they would need something in order to have the power to make payments.

We have strayed slightly from the purpose of the amendment, as is often the case when we discuss such issues. In conclusion, I want to reassure the hon. Member for Stroud that we shall seek to use the powers in a proportionate way, as we are legally bound to anyway under the Data Protection Act 2018. On that basis, I hope he withdraws the amendment.

[Dr Drew]

On that basis, I am happy to beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Question proposed, That the clause stand part of the Bill.

Agriculture Bill (Sixth sitting)

George Eustice Excerpts

Tuesday 30th October 2018 Public Bill Committees

[Martin Whitfield]

I hark back to the vote we previously had on the difference between “must” and “may” and probably leave it at that.

The only other point that I want to raise is that the producers, as well as being under an obligation to produce, would, under amendment 70, be allowed funding for research and development for improved crop varieties and cultivation methods. That will be important going into the future.

[The Minister for Agriculture, Fisheries and Food (George Eustice)]

I want to take the amendments from this group in turn, starting with amendment 51. Elements of the policy and the purposes that we have spelled out will often lead to incidental improvements in and contributions to public health, which I will come to describe.

A number of hon. Members have pointed out that this is predominantly a consumer choice issue. The Department of Health and Social Care and Public Health England do a lot of work to promote healthy eating.

[Sandy Martin]

I said on Second Reading that certain horticultural products, such as broad beans, are not easily found in the shops. We may well have a situation where, because of a change in demand and education in this country, people want to move to different foodstuffs, but it is not easy for farmers to change over. Does the Minister accept that there may need to be investment in farms to enable them to change over to other foodstuffs? Where does he see that investment coming in this Bill, if not in this amendment?

[George Eustice]

I was going to say that that could be provided for under clause 1(2), which enables us to support businesses to improve their productivity if that were necessary. Broad beans, as a leguminous crop, often need less or no fertiliser at all, so that can be an environmental benefit. The current EU scheme enables broad beans and other leguminous crops to be used as one of the contributory factors to the environmental focus area. That is already recognised in the existing scheme, and there would be nothing to prevent us from recognising that in a future scheme.

Under subsection (2), a lot of things can be done to support the delivery of the local sustainably produced food objective. In the last 20 years, there has been exponential growth in consumer interest in food provenance, large growth and expansion of farm shops, and growth in box schemes and farmers markets—I know the hon. Member for Stroud has a well known farmers market in his constituency. There has been huge growth in consumer interest in this area. Under subsection (2), it would be possible for the Government to design a grant scheme to support farmers to open farm shops and to develop their own marketing and box schemes.

Subsection (1) is on the purposes for the delivery of environmental goods. We can pursue a lot of policies under those purposes and objectives that would deliver increased health outcomes. For instance, under subsection (1)(f) on animal health, we could support schemes that lead to a reduction in the use of antibiotics, which would have an impact on public health and safeguard some of our critical antibiotics for the medical sphere.

Under subsection (1)(a), as I described earlier, it would be absolutely possible for us to support an integrated pest management approach, leading to a reduction in the use of pesticides where they were seen to be of concern. Under subsection (1)(a) we could also support a pasture-based livestock system; there is some evidence, although mixed, that livestock such as sheep and cattle raised on pasture and grass have higher levels of omega-3 oils, which are good for public health. There are a number of areas where the purposes we have set out under clause 1(1) also reinforce public health measures.

[Martin Whitfield]

I apologise for my slight slowness; the Minister discussed subsection (2) and suggested that productivity extended beyond the productivity of the field or produce to a wider concept of the word. Is that correct? The end of that paragraph mentions

“agricultural, horticultural or forestry activity.”

Should that not therefore read “business” rather than “activity”, which suggests the activity of growing and maturing livestock?

[George Eustice]

I discussed that with parliamentary counsel. The issue is the subject of a later clause and no doubt we will debate it in more detail then: this is not a narrow economist’s definition of productivity—it is not part of the so-called “productivity puzzle” that people are trying to solve. We are using productivity in its rounder sense, which could include reducing costs, reducing inputs, adding value and increasing the price of things. It could also include—it is very explicit about this—setting up a new business, which could be a retail business allied to a farm business.

--- Later in debate ---

[Jenny Chapman]

In the Minister’s desire to resist our amendment, he keeps referring to the clause, saying that he could do this and it is possible to do that already, and therefore our amendment is not necessary. He does not seem to want to have his boss’s hands tied—his boss to be told that he ought to do something or that he needs to do something. I just want to know why that is.

[George Eustice]

As a Government, we have set out our approach and what we intend to do with these powers. We have already published some policy papers alongside this Bill, which address many of those issues. The Secretary of State has talked about public access to the countryside and the role of farms in educating children, so we have set out clearly in the policy documents that accompany the Bill what we intend to do with these powers. Come the next election, I am sure that the Opposition will have manifesto commitments that will set out their approach and what they intend to do with the powers.

Another issue was raised by a number of hon. Members: that, fundamentally, the decisions about public health and healthy eating are very much around consumer understanding, consumer knowledge and consumer choice. That is why Public Health England has the “Eatwell” plate that it promotes. We have obviously already implemented the first chapter of the childhood obesity plan. We have introduced a levy on sugary soft drinks. We are currently working on the sort of second chapter of the childhood obesity plan.

We take the issue very seriously. Work on it is led by the Department of Health; it is very high up on that Department’s agenda. It is for the Department of Health to lead on and for us to support, and it goes outside the scope of this particular Bill, which is very much about schemes to support farming, the farmed landscape and our environment.

I will give a final example about sugar, which was raised by some Members. When quotas on sugar beet production were removed, some people said, “Shouldn’t we keep sugar beet quotas? That would be a way of restricting the growing of things that we think are bad for public health.” However, the reality is that the most powerful thing was the introduction of a levy on soft drinks; the value of the sugar that goes into a soft drink is actually tiny, and messing around with the price of sugar is not what delivers the outcome. What delivers the outcome is a levy on sugary drinks that drives policies of reformulation, and that is why the levy has been a success.

We know that some of these measures to try to mess with the supply side of the chain are actually blunt instruments when it comes to delivering public health outcomes.

[Kerry McCarthy (Bristol East) (Lab)]

I mentioned in the few moments that I had earlier the recent research into food deserts. Particularly in urban areas, there are vast estates where it is very difficult for people to get access to healthy food. As I suggested, we could use this Bill to address that. It is not about the growing of the food; it is perhaps about setting up shorter supply chains, so that the food can get to these places. Maybe it could be about setting up farmers markets in local areas that do not normally have access to them. That would also help local farmers who produce the goods to find a market that would probably pay them a bit more than the supermarkets might.

[George Eustice]

There will be a place for those sorts of enterprises, although not for all. However, as I said earlier, we are looking at what we could do alongside, for instance, a county farms offer to support some of those peri-urban schemes. Sometimes they are box schemes, but they are community-led schemes in particular areas, quite often in our cities. I made it clear earlier that we believe we would be able to support those farms, under both subsections (1) and (2). That option exists, so it is there already if we should want to support it. We have been clear that we are exploring this idea and considering it. It will not be for everyone. There will always still be a place for larger-scale productions supplying the supermarket multiples where most people will get their food and where there is already quite a wide choice. However, it will be an option for some and we have kept the door open to supporting it.

To conclude, these are unnecessary amendments and many of the health benefits we have alluded to in our White Paper are dealt with through the existing measures in clause 1.

[Kerry McCarthy]

The Minister does not seem to have mentioned the food policy or food strategy or whatever it is called. I heard on the grapevine that it has been kicked into the long grass. Will he confirm that that is not the case and that work is still being done?

--- Later in debate ---

[George Eustice]

The food strategy is alive and well. The hon. Lady is right and it is in my notes and I intended to mention it. We have a food entrepreneur, Henry Dimbleby, from the Leon food chain, who is doing a piece of work at the moment on the food strategy that will obviously complement what we are doing here. However, we believe we have the powers in the Bill to do the things that we want to do in this space.

On that basis, I hope that those who have spoken to amendment 51 and 70 will consider withdrawing them, because I believe that the issues they are trying to cover are already covered in the Bill.

[Dr Drew]

To start with, I declare an interest: my wife has a stall on Stroud farmers market every fortnight. Please come along to see the wonderful wares that she sells. I had to get that on the record.

This has been an interesting and wide-ranging debate. Clearly, we are not going to come to a meeting of minds, but the issue will come back. I keep reiterating the fact that the White Paper, “Health and Harmony”, and the issue of public health which it identified as a crucial element in the way in which the food chain functions in an Agriculture Bill, are not going to go away. It may be that this is not the time to force a Division. I make that clear, but we make no apology for saying that we will come back on this because it is important that we understand that people out there may not understand the legislative process but they understand what they think should be the elements of what we do for the future of the policy.

I hear what my hon. Friend the Member for Bristol East says on the food strategy. It would be helpful if the Government were clear on when it comes forward, as it should be with the environment Bill, because these are interrelated. This is the problem with legislation. We only have one side of the coin, when we need both sides to make sense of the totality of the Government’s approach.

It is important that somehow health is in the Bill and I hope the Minister will reflect on this. Public health matters because what people eat depends entirely on their access to food and its availability and what they can afford. It is also to do with the fact that to some extent we have an influence, through production and distribution.

I hope the Minister has listened to the debate. We will not push the matter to a Division at this time, but it will come back because people feel very strongly about it, whether it concerns food poverty, or purely obesity and diabetes, or the reality of how food is increasingly the reason people’s life expectancy is determined. I understand what the Minister has said and I know there are lots of contingent points in his argument. However, I hope we can extract that and at a future time clarify where public health is in relation to the Bill. I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

--- Later in debate ---

[Jenny Chapman]

I note that that is because we are in a customs union. That is my point: we have those high standards now, and I want to ensure that we have them in the future, and I do not see any way of doing it other than putting it on the face of a Bill—I accept that it does not need to be this Bill, but we need to know that this will happen.

[George Eustice]

On a point of clarity, my right hon. Friend the Member for Scarborough and Whitby is right that we have border inspection posts around the UK. They are a port of entry currently for the EU, and when we leave the EU they will still be a port of entry, with all the broader inspection facilities we need, for countries outside the EU.

[Jenny Chapman]

That very much depends on the terms on which we leave the EU. Whatever those terms are we need to be absolutely clear about our standards on animal welfare, food safety and all the rest of it. If we are not, there is scope for these very high standards of which we are all proud to be watered down in some way. That is the sole motivation behind the amendment. It is not intended to ridicule the Government, or to try to show that we care more about animals than Government Members do or any of that. It is about making sure that, in the future, the UK maintains its position as a world leader on these issues.

--- Later in debate ---

[George Eustice]

I will begin with amendment 75, as the other two amendment both pertain to animal welfare. This amendment effectively says that people have to abide by retained EU law before they can be eligible for any assistance. Retained EU law is coming across through the European Union (Withdrawal) Act 2018. It will apply to everyone, whether or not they are in a scheme. We do not believe the amendment adds anything or is necessary, as retained EU law will become UK law and will be enforceable as such to everyone. The important thing about the new schemes from our point of view are the conditions attached to them. We deal with that very differently, in clause 3, which we will no doubt debate later and which has all sorts of provisions for checking, enforcing and monitoring. It requires provisions for the keeping of records and allows us to impose penalties, establish appeals processes and refer powers of entry, for instance. Clause 3 sets out clear enforcement powers and the ability to set conditions on access to such schemes, which in our view is the right way to approach this.

There is also a technical problem with amendment 75. The hon. Member for Bristol East at least said that everybody should abide by the legislative baseline, whether that be retained EU law or any other domestic legislation. The problem I have with the amendment is that it treats retained EU law as if it were the only law that matters. It is mute on other national law. If we were to require people to abide by the law—which they might believe they would be required to do anyway—why would we require them to abide only by retained EU law, rather than any other class of law? To me, that does not make much sense.

[Jenny Chapman]

We do not want it to be retained EU law; we want it to be primary UK law. That is our point, because we think that has a different status to retained EU law.

[George Eustice]

The provisions that I am reading are very much around EU law and retained EU law, but I take the hon. Lady’s point that she may have intended the measure to be broader.

There is a third point, however. We are clear that we accept some of these principles. We will provide for a new environmental body to police them. We have already said that we are committed to those principles coming across. There is a difficulty, however, in the practice of a scheme where financial incentives are being paid. It is not always black and white. For instance, the “polluter pays” principle sounds great in theory, but what if there is a diffuse pollution incident somewhere in a water catchment that might involve small contributions from a number of farms that are difficult to locate? It is not always easy to just say, “We need regulation,” or, “We need enforcement,” on this farm or that farm.

In recent years we have successfully paid farmers to support them in investing to improve slurry infrastructure. We have had a successful scheme in the past two years to pay farmers to put lids on slurry stores, so that they can reduce ammonia emissions, for instance. If we are serious about tackling complex environmental issues such as diffuse pollution, we have to be willing to venture beyond what can be achieved with a blunt regulatory instrument and instead be willing to have financial incentives, rewards and grants to support good practice. A requirement to abide by the “polluter pays” principle will often be used, as in this case, by people who want to sit on their hands and not spend money. If we are serious about doing payment for public goods properly, we must be willing to exercise judgment and to support schemes that may fall into the grey area between what would normally be covered by regulation and what would be covered by an environmental purpose.

Amendment 74 relates to animal sentience, on which we have already published draft legislation. The Government are absolutely committed to making the necessary changes to UK law to ensure that animal sentience is recognised. This country has always been a leader in the field. In 1875, we were the first country in the world to pass legislation to regulate slaughterhouses. The Protection of Animals Act followed in 1911, and in 1933 we updated a lot of our regulation, particularly of slaughterhouses. The Animal Welfare Act 2006 recognises animal sentience. We would never have passed any of that legislation if we did not believe that animals were sentient beings. That is beyond question; both sides of the House and all Governments have believed it for at least 140 years. We are committed to introducing a Bill to recognise animal sentience.

[Dr Drew]

Will the Minister assure us that that Bill will be introduced before March? If not, what will the status of farm welfare be if we crash out of the EU, for example?

[George Eustice]

I cannot guarantee that that Bill will be introduced by March, but obviously we are working on the basis that there will be an implementation period, in which case all those principles will apply. More importantly, however, I can guarantee the hon. Gentleman that all retained EU law—the entire body of legislation that governs everything from slaughterhouses to transport regulations—will be brought across. That is already happening in a large wave of statutory instruments made under the European Union (Withdrawal) Act 2018. Every single piece of EU animal welfare legislation will be effective and on our statute book by the end of March.

[Dr Drew]

There is the rub. We know that something like 80 SIs are coming our way. We may not choose to object to them all, but even if we object to only eight or 10, it will wear the Minister out, wear me out and have huge implications. Effectively, it will mean that we cannot do anything else, because that is what the nature of the SI process implies. It is all well and good saying that secondary legislation is the way forward, but it will not necessarily be very practicable.

[George Eustice]

rose—

[Mr Dunne]

May I help the Minister on that point?

[George Eustice]

I think it is probably best if I answer one intervention before I take another.

We are in the middle of a huge decision to leave the European Union. An enormous amount of work is needed under the withdrawal Act to ensure that we have a functioning statute book on year one; we all recognise that, and it will necessarily take priority in the months ahead. However, I reassure the hon. Member for Stroud that all the EU regulations that bind us on this issue will still be in force in UK law when we leave the EU at the end of March. That will be unaffected by whether a Bill that recognises animal sentience has been introduced, because none of the regulations that we are bringing across are contingent on the overarching principle of animal sentience.

[Mr Dunne]

I have the distinct privilege of serving on the European Statutory Instruments Committee. The Leader of the House has reassured us that the volume of work for us in determining whether the forthcoming statutory instruments should be laid under the negative or the affirmative procedure will be very similar to that of scrutinising the routine number of statutory instruments that the House considers year on year. The forthcoming SIs should not give rise to the kind of concerns that the hon. Member for Stroud has voiced.

[George Eustice]

As a member of that Committee, my hon. Friend has to digest those points, so he probably has a clearer idea of the work that will be involved, but we recognise that it is a big exercise.

The hon. Member for Darlington raised an important point. I can reassure her that the Government are committed to publishing legislation that will recognise animal sentience. We do not believe, however, that it is right to bring that into the Bill in the way that she has by linking it only to the narrow issue of how payments are made, when we are talking about purposes that inevitably recognise animal sentience, because that is why we are incentivising farmers to adopt high standards of animal welfare.

Amendment 71, tabled by the hon. Member for Bristol East, also seeks to establish an additional rule that says broadly that financial assistance cannot be given unless it is over and above the regulatory baseline. I understand her point, and it is a legitimate question to ask, but it is wrong to try to prescribe it in that sort of amendment, for reasons that I will explain.

As a country, we have done something new in including animal welfare as a public good. I have been clear that I wanted to do that for the last couple of years. I have worked closely with the RSPCA, Compassion in World Farming, Farmwell and other organisations. We are trying something new. Just last week, I met Peter Stevenson from Compassion in World Farming.

We are considering several things in the design of a future animal welfare scheme. One of those is the possibility that we could financially reward farmers and incentivise them to join some kind of United Kingdom accreditation service-accredited higher animal welfare scheme—perhaps the RSPCA one or others that may form. We may also choose to support farmers to invest in more modern housing that is better for animal welfare. In the pig sector, there are some issues with outdated housing that does not lend itself to providing for modern welfare needs such as enriched environments and straw in barns. We may also have a third category of payment for the adoption of particular approaches to husbandry, such as lower levels of stocking density, systems that are more free range or even pasture-based systems.

Finally, we are interested in the potential for payment by results. Farmwell has done some work on that. The hon. Member for Bristol East mentioned Compassion in World Farming and its view about payments for curly tails. If pigs go to slaughter with intact curly tails that have not been damaged, that is a good indicator that they have had a higher-welfare existence. Likewise, Farmwell has developed a feather-cover index for a depopulated flock of laying hens, which is a good indicator as to how well people have approached farm husbandry. In a free-range system, there can be good and poor farm husbandry.

It is a complex area. If there is a mixture of payment for capital items to renew housing, which may have higher welfare outcomes, payment for joining accreditation schemes and, potentially, payment by results, it is not always obvious how that would be benchmarked against a regulatory baseline, which by definition does not cover everything.

If the hon. Lady is concerned about money being spent in that area in a way that simply pays farmers for what they are already doing to comply with the law, I guarantee that there will be no shortage of push-back and pressure from within the internal machinery of Government—the civil service, the Treasury, the Cabinet Office and other Departments—to ensure that money is spent only to get additionality. We will not have the problem that she perceives, which is that we would spend money on things that are already a requirement by law, but if we were to accept her amendment, we might have a different problem, which is that we would place barriers in the way of policy innovation. For that reason, I hope she will not press amendment 71.

[Mr Goodwill]

The Minister talks about paying farmers for what they are doing already, and having had experience of the entry-level environmental scheme, that is precisely what it did. He might recall, however, that one of the questions I asked the farmers unions was how we should get the balance right between rewarding people who have always been doing the right thing and incentivising improvements on land that has not been looked after in the same way.

[George Eustice]

My right hon. Friend makes an important point. I am conscious that on animal welfare and in the agri-environment schemes, a lot of farmers have already done a huge amount of work, and it is important to recognise that and to continue to reward them for that. The baseline, such as it is, should be anchored somewhere around the regulatory baseline. Even then, I do not think we should have a hard and fast rule, for the reasons I have explained on issues such as investment in slurry management. In this innovative new field of animal welfare, there are grey areas, and it is not always right to have a hard and fast rule.

The hon. Member for Bristol East mentioned the issue of cross-compliance. The conditionality on new schemes is provided for in clause 3. If somebody enters a new scheme and is in breach of it in some way, there are provisions for financial penalties and for the powers that we would need to be able to do that.

Having been farming Minister for five years, and having wrestled with cross-compliance, I am not a great fan of how it works in practice. It is a rather dysfunctional system. There is literally nothing—bar one thing—in cross-compliance that is not already in our domestic law. All the requirements on ear tagging, animal health and animal welfare, or the issues around TB testing and good environmental condition for land, are already requirements in our national law. All that cross-compliance really gives us is a sort of easy and rather unjust way to claw penalties out of farmers without really giving them a chance for a fair hearing in court. In my view, it is not a very satisfactory system. We would need some sort of system of fixed penalty notices in future, so that there are ready remedies for minor breaches, but we could design something far better. Cross-compliance will remain in the legacy scheme that we will come on to debate, but we will have the opportunity to modify and improve it and to remove some of the rather unnecessary administrative burdens that can get in the way.

I hope that I have managed to persuade hon. Members that the Government remain absolutely committed to amendment 74 animal sentience, but we believe it should be in another Bill. We have already published draft legislation. On amendment 75, retained EU law will already be binding on anyone, whether or not they are in a scheme. I hope that the hon. Member for Bristol East will not press amendment 71, as it would be counterproductive to the cause that I know she believes in very strongly.

[Jenny Chapman]

I am not surprised by any of the Minister’s comments. His attempt to reassure the Committee on EU retained law and SIs was not particularly effective. As we said at great length during the passage of the withdrawal Act, the ability to amend the Act is of deep concern to us. We think it is far better that the provisions should be in the Bill now, so that everyone can see exactly where we are. We are not happy with the approach that the Government have taken, and not just in these areas but in many others.

The Minister invited me to look to clause 3 for reassurance. Again, we come back to the powers that have been given to the Secretary of State, which are so wide-ranging. Although there are suggestions in the Bill about what those powers may be used for, the lack of precision is astonishing. Clause 3(2) states that “under subsection (1)” the Secretary of State

“may (among other things) include provision”.

It is extraordinary that the Government are attempting to proceed in this manner and expect the Opposition to go along with it. We are just not going to do that.

I might not be minded to press the amendment to a Division today, but I do not want the Committee to interpret that as demonstrating any kind of satisfaction on our part; it absolutely does not. We intend to return to these issues, which is one of the reasons why we will not press the amendment today. That might increase our chances of being able to return to the issues, which are fundamental to why we think the Bill is so flawed. I take the point about linking the issues to financial assistance. There might be something in that, although taxpayers want to know the principles by which their hard-earned cash will be spent in this area. I do not think that the Minister has responded adequately to our concerns. I expect that in the other place, and on Report, we will go over those issues again.

As for amendment 74 and the promised new Bill, we want and need to see the Bill, not just assurances that it is on its way. The Secretary of State said, “I want this to happen because I too am a sentient being.”

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[Deidre Brock]

Forgive me, but I am speaking about amendment 90, which makes it clear that it would impose financial restrictions on the schedule. I am objecting to it because, from the Scottish Government’s point of view, that is not desirable.

I note that paragraph (b) would allow payments to be made to landlords and others who have an interest in the land but do not actually produce anything, rather than farmers. That is certainly a concern. I feel strongly that these kinds of decisions should be made by the Ministers setting up the scheme, rather than by people in this room.

[George Eustice]

I will take each amendment in turn. I am delighted that the shadow Minister described amendment 52 as a probing amendment. I will explain why the Government have chosen not to take that approach for England. He asked what Wales did to get this. I can clear up the mystery: there is no mystery. This is a fully devolved matter. The Welsh Government have the power and ability, if they want, to introduce their own Bill. They have taken, in my view, the very sensible decision to say that, for the time being, they want to make sure they have legal clarity, so they wanted a schedule that effectively mirrored the Bill for England. At a later date, they will consider additional primary legislation. The clause is in the Bill not because they won an argument; it is simply because they asked for that additional clause.

--- Later in debate ---

[Dr Drew]

I go back to my original remarks: pillar 2 was all about the rural underpinning of what happens in rural areas as well as agriculture. Is the Minister saying we are precluding any form of support for things that relate to the rural?

[George Eustice]

No, not at all, and I will return to that point. We have an alternative plan for rural support and support for rural communities.

Paragraph (c) of amendment 52 states that financial assistance can be used for

“supporting persons who are involved in the production, processing, marketing or distribution of products deriving from an agricultural, horticultural or forestry activity.”

That could open the door to Unilever being paid grants for its manufacturing or a haulier with a chill chain operation being paid to take food to Tesco. It would even enable money to be paid to Tesco itself. I am not sure that the amendment would achieve what those who suggested and promoted it hope to achieve. In fact, it would open the door to a severe dilution of the Bill’s intention.

That said, we understand from our discussions with the Welsh Government that they are a little uncertain how they will use the power. They wanted it as a fall-back provision and envisaged using it for a short time until they could replace it with something else. It may be a provision in the Welsh schedule that is used in a very limited way, if at all, depending on the development of Welsh policy.

I turn to our plan for delivering for these areas, which is the shared prosperity fund. It will have a rural strand. The shared prosperity fund will replace the plethora of EU structural funds. We are working very closely with the Ministry for Housing, Communities and Local Government and other Government colleagues to ensure that there is a rural programme within that shared prosperity fund and to ensure, for example, that LEADER and other grants have some kind of successor scheme.

[Dr Drew]

I hear what the Minister says. Does he agree that there should therefore be some ring-fencing? Rural always gets crowded out. Does he agree to negotiate outside this space on what ring-fencing could mean?

[George Eustice]

One Bill at a time. When legislation is introduced on the future shared prosperity fund—I understand that there will be a consultation later this year—everyone will then have an opportunity to participate in that debate, but it is a debate for another time. We have enough issues on our hands at the moment.

Amendment 88, tabled by my hon. Friend the Member for Ludlow, is similar to amendment 52, with the exception that he has added a paragraph (d) that would effectively require us to have regard for self-sufficiency. I note that he has borrowed the language in paragraph (d) from section 1 of the Agriculture Act 1947. Obviously it was a very different time—1947 was immediately after the second world war. We still had rationing books; we did not end rationing in this country until 1954. Our levels of self-sufficiency in the run-up to the second world war had been woefully low.

To put that in context, self-sufficiency today is very high by historical standards. In the late 19th century, and up until the second world war, our level of self-sufficiency hovered between 30% and 40%—far lower than it is today. It was a series of interventions, including the 1947 Act and others, that meant that it peaked at somewhere close to 70% in the late ’80s. As a number of hon. Members pointed out, there was a cost to self-sufficiency at that level: appalling levels of intervention, perfectly good food being destroyed, and production subsidies to produce food for which there was no market. The old-style production subsidy regime that used to pertain to the common agricultural policy was totally dysfunctional and severely discredited, and was therefore dismantled some time ago.

It is important to recognise a distinction between self-sufficiency and food security. Sometimes people conflate those terms. Food security depends on far more than self-sufficiency. We know that to deliver genuine food security both nationally and internationally, vibrant and successful domestic production and open markets are necessary. Just look at this summer, when we had an horrendous drought and crop failures across the board. That happens. It is the nature of farming, and it is therefore important, in order to protect food security, that we have open markets and trade. That has always been the case.

The other reality is that in a modern context the greatest threat to food security is probably a global one. We have a rapidly growing population, set to reach 9 billion by 2050, and we have the countervailing force of climate change and a lack of water resources, which means that in parts of the world where we are currently producing food it may be more difficult to do so in 10 or 15 years’ time. Scarcity of water could be a global challenge. The issue of food security is less about national self-sufficiency in case there is another world war—our negotiations with the EU are challenging but we do not envisage it getting to the state of our requiring something like the Emergency Powers (Defence) Act 1939. The challenge on food security, insofar as it exists, is ensuring that we can feed the world.

Another question is how best to deliver food security and a successful farming industry. Is it best to do so through direct payments—subsidy payments based on how much land farmers have? Direct payments were decoupled from production some 15 years ago, so those who suggest that direct payments are somehow a guarantor of food security are wrong. Many hundreds, or possibly thousands, of people own a bit of land, have a job in the City where they earn their income, mow the grass a couple of times a year and keep a few pet sheep on the land, but nevertheless hit the collect button on their single farm payment. That cannot be a viable, long-term approach.

The question therefore is how do we best support a vibrant and successful farming industry? Our view is that we should not do it through subsidies of the old style, but by supporting farms to become more profitable, to reduce costs, and to produce and sell more around the world. That is why the approach that we have taken to deliver food security, such as it is, is included in subsection (2), which covers the power to give grants to help farmers to invest, and the power to support research and development so that we can see the next leap forward in plant breeding or in animal genetics. There are powers later in the Bill that we will debate at a future date to allow producer organisations to be formed so that farmers have more clout in the marketplace and get a fairer price. There are powers to improve fairness and transparency in the supply chain. Where we want to end up is with a successful, vibrant, profitable farming industry that is able to produce more food.

[Sandy Martin]

I am listening carefully to what the Minister is saying, but subsection (2) does not mention food. It mentions some of the activities that may be invested in in the production of different foods, but there are all sorts of people who would want to produce very good, sustainably produced, healthy food, who would not be able to get any support whatsoever from the Government under subsection (2).

[George Eustice]

I do not agree. Subsection (2) is very clear. It gives us the power to

“give financial assistance for or in connection with the purpose of starting, or improving the productivity of, an agricultural, horticultural...activity.”

It could not be clearer. It gives us the power to invest in the way that I have described.

[Jenny Chapman]

This is problematic. I do not think the Minister knows how to answer his own questions about how best to support farmers. Clause 2(2) says:

“Financial assistance may be given subject to such conditions as the Secretary of State considers appropriate.”

I do not know how much wider we could get, and my hon. Friend the Member for Ipswich is worried about its being too narrow. That is the problem with the Bill.

[George Eustice]

I do not accept that criticism of the Bill. We have discussed many times the romantic attachment of some hon. Members to the 1947 Act. Let me just read from it again. It describes Ministers being able to do things that they deem “expedient”. We have a concern about giving the Government and Ministers power to get things done, but that is what has been missing in our time in the European Union. We should embrace the fact that we are now able to get things done as a country.

My final point on food security is that, if we look at the evidence, the sectors that contribute the most to our self-sufficiency as a nation are the ones that are unsubsidised, not those that are subsidised. We are 96% self-sufficient in carrots, which is traditionally an unsubsidised sector for which the current single farm payment is irrelevant. We are 92% self-sufficient in cabbages and 95% self-sufficient in peas. We have seen a big increase of 15% in the production of vegetables since 2010 and a 50% increase in top fruit and soft fruit production. The unsubsidised sectors have been the most innovative and have done most to contribute to our self-sufficiency.

I turn to amendment 89, which is in the name of my hon. Friend the Member for Ludlow and is supported by my hon. Friend the Member for Gordon. It seeks to limit the eligibility for financial assistance across the board to people who are in farming or food production. I understand the intention behind the amendment. The concern, if I could caricature it, is that in future a Government may just give all the money to green non-governmental organisations, which will buy a large fleet of Land Rovers and employ a large army of regional officers to go around chivvying farmers to do things differently. That is not our intention at all.

We have been very clear that we envisage a future where there will be an environmental land management contract principally with the farmer or the landowner. There is a very important reason for that. We cannot deliver any of the public good benefits unless the landowner or the occupier of the land—the tenant—are fully on board and fully signed up to do so. That is why virtually every one of the paragraphs of clause 1(1) refer to the farmland or the farmed environment and managing land in such a way as to promote the environment. To do that, the landowner or the tenant has to be the main recipient of that funding and the person with whom we have the contractual arrangement.

What we do not want to do is rule out the scope for there to be, for instance, some lower level facilitation work to get regional level co-ordination, which a group such as the RSPB or the Wildlife Trusts might engage with. There could be a role to design schemes to have some facilitation funding, as we do now under the EU schemes, for some of those third-sector organisations. In some national parks or areas of outstanding natural beauty, we might find that there is a collective body that could do that in partnership with farmers.

While we cannot accept this particular amendment, I understand the concern of my hon. Friend the Member for Ludlow. With the policy papers that we have launched, I can reassure him that we absolutely intend that it will be farmers, landowners and tenants who receive the lion’s share of these funds. They might choose to subcontract certain responsibilities and tasks to third-sector organisations, but if we want to ensure that there is delivery, our relationship must be with that landowner or land occupier.

--- Later in debate ---

[Dr Drew]

I have very little to add to what my hon. Friend has said. Basically, the amendment seeks to clarify what is meant by “productivity”. We believe the Government have quite a narrow definition of productivity that undermines the environmental sustainability that the Bill is based upon. We hope the Minister will say how he would interpret productivity and that he will take a wider view since we are looking at different aspects of productivity besides the purely agricultural and limiting definition that could be implied. For us, the issue is about improving quality and efficiency, but also about how we go about doing that. Again, that is the weakness of the Bill. It says a lot about what it might want to do, but not much about how it will do it, so we want that clearly defined. Reducing dependence on pesticides, weedkiller and fertilisers is implied in the way in which the Bill is being promoted, but exactly how that will be attained is not in the measure.

Sustainability, a primary feature of the Bill, needs to be spelt out more clearly in terms of how the legislation is entailed, otherwise there will be a misuse of public money. For example, we are not really spelling out how we want to minimise the carbon impact of agriculture. We know that agriculture could achieve carbon sequestration much more fully than it currently does.

On climate change, we are looking at issues to do with restocking levels and how they would impact on emissions levels, and at the antibiotic issues that my hon. Friend the Member for Bristol East identified. Amendment 53 would require a proper consultation on the meaning of “productivity” and a much broader understanding of sustainable productivity.

[George Eustice]

I will try to be brief in dealing with the two important points. First, the impact of amendment 73 would be to subordinate subsection (2) to the purposes in subsection (1), which is problematic on numerous levels. I can reassure the hon. Member for Bristol East that when it comes to the payments that we will make for the delivery of public goods, which we envisage being the cornerstone of the future policy under subsection (1), there will be conditions attached to those and requirements for entering such schemes. There will be enforcement provisions, as I said, in clause 3 to deal with that.

I understand the hon. Lady’s concern that we do not want to support something on the one hand that might undermine objectives on the other, but it is inappropriate to link the two in the way that she does because the right way to do it is to apply conditions on both. It is possible for us to apply entry-level conditions for the payment of productivity grants so that they explicitly do not undermine some of our other objectives. That will change from case to case depending on what is being supported. If there was something that dramatically improved yields but had an impact on the environment, we might be cautious about supporting it. If we supported, for instance, robotic technology to aid harvesting, it might not have any natural crossover with the provisions in subsection (1). I think the correct way to approach this is to put the right conditions on schemes under both subsection (1) and subsection (2), so that they complement rather than undermine one another. The amendment is unnecessary.

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[The Chair]

With this it will be convenient to discuss new clause 7—Environmental land management contracts—

‘(1) The Secretary of State shall, by regulations, make provision for environmental land management contracts.

(2) A person who manages land may enter into an environmental land management contract with the Secretary of State to deliver one or more benefits under section 1(1).

(3) A person who manages land and who seeks to enter into an environmental land management contract with the Secretary of State must first submit a land management plan.

(4) The Secretary of State must approve a land management plan submitted by a person who manages land before entering into an environmental land management contract with that person.

(5) Regulations under this section may provide for—

(a) one or more persons or bodies to act on behalf of the Secretary of State for the purposes of entering into an environmental land management contract, and

(b) requirements which a land management plan must meet if it is to be approved by the Secretary of State under subsection (5).

(6) Regulations under this section are subject to affirmative resolution procedure.’

This new clause would require the Secretary of State to make provision for environmental land management contracts.

Given that the Committee has thoroughly debated the amendments to clause 1, I hope that comments in the clause 1 stand part debate will be brief, and will not rework arguments that we have already heard today.

[George Eustice]

We have debated a wide range of topics and there have been amendments moved to, and discussions on, virtually every conceivable aspect of clause 1. The Government believe that clause 1(1) has a broad range of purposes and outcomes that enable us to deliver all the schemes we want, and that clause 1(2) has all the powers we need to support a profitable, vibrant and growing agriculture and horticulture industry.

[Dr Drew]

I shall not say that much more. We have our misgivings about “must” and “may” and some of the issues that arose in the wider debate. It was appropriate to debate clause 1 in considerable detail, because it is the clause that sets the Bill in the direction of travel that it is taking.

I shall confine my remarks mainly to new clause 7, which is important. Not least of the remarks I want to make is that the Government have been clear about setting a lot of store by environmental land management contracts. The White Paper, “Health and Harmony” contained a quite long piece on environmental land management. Hon. Members will be pleased to know that I will not quote the whole of it, but it does say:

“The government will work with farmers and land managers who wish to improve the environment by entering into environmental land management contracts, which could span several years.

These contracts will make sure that the environmental benefits farmers help deliver, but which cannot be sold or bought, are paid for by the public purse.”

This is about money and how we pay farmers and others to do things on the land. The White Paper gives lots of examples, including

“helping deliver high air and water quality”

and

“protecting and enhancing biodiversity on their land, by providing habitats for wildlife, for example”.

We feel that new clause 7 is worthy of inclusion because it tries to identify from the Government exactly how environmental land management contracts will operate and the way in which moneys will be paid. The danger is that such things will slip by if we do not draw attention to them. Various organisations support what we are trying to do, including the Uplands Alliance and the Joint Nature Conservation Committee for the lowlands. The Ramblers are keen to ensure that access to the land is a crucial part of any contract that is negotiated, so that when public moneys are granted, people have the right to access the land.

The previous Labour Government spent a lot of time on access arrangements. Sadly, we did not get as far as we wanted on coastal access, but land was made available for what is figuratively called “the right to roam”. That was done in perhaps a more persuasive manner than was necessary—the Countryside and Rights of Way Act 2000 introduced legislative bite—but there was solidity in how access was allowed. That is why it is important that we link access to the debate on clause 1.

I do not have much more to say about new clause 7. We are not happy with some aspects of how clause 1 has been dealt with. There have been lots of promises and good intentions, but there are holes in the Government’s approach to the Bill. It is not just me saying that; the House of Lords Committee was scathing about the way in which so much depends on statutory instruments, rather than being in the Bill. We will vote against the clause, because we feel that it is important to get some of the detail we have been arguing for into the Bill.

We have spent a lot of time—more than five hours—on clause 1, but it is effectively what the Bill is about. If clause 1 is not right, the rest of the Bill is pretty unimportant. We will be tabling other amendments, but we have spent a lot of time on the clause to try to get the Bill right. Sadly, the Government have not moved as far as we want them to. Hopefully, they will get other chances on Report and Third Reading, and things will happen to the Bill in the House of Lords. We are trying to be helpful. We not trying to wreck, but to improve. With that in mind, I hope the Government will understand why we are not willing to vote for the clause.

[George Eustice]

Briefly, the Government regard new clause 7 as unnecessary because clause 1, as it stands, gives the powers necessary to design schemes. The lesson we have learned from decades of working with these schemes is that the environment is inherently complex, so we often need an iterative approach to the design of schemes so that we can add, remove or refine options as we move forwards.

The system that we have had with the common agricultural policy has been completely dysfunctional and unsuited to that aim. We have ended up with a morass of regulations that define everything from the minimum and maximum width of a hedge, to the maximum width of a gateway, what size a buffer strip should be, what type of flowers people can grow, and what type of plants people can grow on top of a hedge. It is a ludicrous morass of regulation and we do not want to recreate it. We need the powers that will enable us to design contracts that really work, farm by farm, at local levels.

[Dr Drew]

I hear what the Minister says, but those environmental land management contracts will be even more complicated. A whole-farm approach is great—we want that to happen—but we are going to look at every bit of woodland and watercourse, and all the ways in which field boundaries are currently maintained. That will all be wrapped into the contracts, and somebody has to manage and monitor that. Will that be any easier than the current system?

[George Eustice]

Yes, I believe it will be easier, because our vision is that there will be an expert on the ground. That might be somebody from one of our agencies, such as Natural England, or it might be an agronomist with whom a farmer works, who visits the farm, walks the farm, and sits around the kitchen table with the farmer to help them put the scheme together. Having given it their assent, there is then a presumption that it is supported through the system.

We want less emphasis on mapping, and fretting about a bush in a field in Derbyshire and whether it is an eligible feature, and whether a farmer claimed something that he should not have claimed. We want to get back to a human relationship between an adviser and a farmer, and I believe that we can make the systems work far better. To do that, we must avoid trying to define too much in regulation, since it hampers the ability for judgment on the ground.

Question put, That the clause stand part of the Bill.

Agriculture Bill (Fifth sitting)

George Eustice Excerpts

Tuesday 30th October 2018 Public Bill Committees

[Dr Drew]

That is the point. The argument I am advancing is nothing other than something that has been advanced in the other place. I do not know what the Minister thinks about the Delegated Powers and Regulatory Reform Committee of the House of Lords, but it is hardly a strong supporter of the Government’s approach. It reported:

“We are dismayed at the Government’s approach to delegated powers in the Agriculture Bill.”

That is a cross-party Committee, and as much as we will do our bit in this place, I suspect that the Government are not looking forward to taking the Bill through the Lords, because the Lords will certainly make those points, following their current investigation. In the 36 clauses, they identify 26 powers of Ministers to make law, including five Henry VIII powers, which we always tend to question. Perhaps it is the Opposition’s job to be the lender of last resort to ensure that we do not allow things to slip through in any way. We make no apologies for concentrating on this important issue early on. We are not asking for everything to be turned into duties—that would be silly. Clearly, a future Minister will need discretion, but unless they know what the law is, it will be totally down to discretion. That is not a good thing.

It is interesting that we are now undertaking legislative scrutiny, because the Select Committee is looking at the Bill at the same time as us. If we had had pre-legislative scrutiny, perhaps we would have ironed out some of these issues. This was certainly one of the dominant themes during the evidence sessions from different groups. I do not think that any of them would argue that they were happy with the powers currently left in the Bill; some duties are needed. I have no doubt that we will debate this over the course of the morning, but we regard it as a missed opportunity. According to the explanatory statements, amendment 44

“would require the Secretary of State to provide financial assistance for the purposes listed in Clause 1,”

and amendment 45

“would require the Secretary of State to make regulations for the checking, enforcing and monitoring of financial assistance in Clause 3.”

Those are pretty important things. If the Secretary of State is not asked to do those things, they do not have to do them. They may want to do them—the Government may feel it is their duty to do them—but, sadly, there is no legislative enforcement. That is why we want to put this in the Bill.

This is once again about the way in which the House should operate, and we challenge the Minister to promise to place duties at the centre of the Bill, so that it will do what we—certainly on this side of the House—want it to do, which is to cement the relationship between environment, food and health. The Minister has a duty to look at issues such as public health and the safety of the industry, which one would have thought is what the Minister for Agriculture should be doing—it is central to their whole being.

We hope that the Government are listening and that the debate gets off on the right foot. We would like to work with them on this, but we make no apologies for pressing the amendment to a Division if there is no consensus. If the Minister makes concessions, we will listen to him. It would be interesting to know why the Government are unwilling to put duties in the Bill; is it because they are worried about some of the powers, which they might not want to use? If so, perhaps the Minister would say which powers the Government really need discretion on, and we will listen and see if we agree.

The finance and the regulation of finance should be a duty, and something that the Minister of Agriculture should have to face Parliament about because of the nature of their responsibilities. We are strongly in favour of the two amendments because they would make sure that there are duties on the Secretary of State and the Minister for Agriculture in clause 1. Amendment 45 would impose a duty to look at the way in which we regulate finance.

After Brexit, the common agricultural policy will no longer provide our regulatory system, so it is even more important that we get the Bill absolutely right. Whatever one’s views on Brexit, agriculture is the major industry that is most dependent on the EU for both budget and regulatory framework, so we must get the Bill right, today and in subsequent sittings. As I have said, the House of Lords has a fair amount to say in the paper that it produced—I am sorry that I have only a photocopy, but we all have photocopies because they do not produce hard copies any more—which is a pretty devastating critique. The Lords are worried about how much the Government are leaving to statutory instruments.

We all received a copy of the Agriculture Act 1947, which is well worth reading, in case anyone has not read it. [Interruption.] The Minister is waxing lyrical about it. The 1947 Act put into primary legislation the way in which the agricultural system in this country was to work for generations. All we are saying is “Let’s do the same with this.” This Bill replaces the 1947 Act. One could argue that the changes in 1975 and 2005 were minor compared with 1947 and 2018. Let us start on the right footing and know what we expect the Secretary of State to do, because that is what we are here to do. Parliamentary scrutiny is meant to improve legislation, not wreck it. We think that our proposals will fundamentally improve the Bill and make sure that we get off on the right foot and that we have a better Bill at the end of Committee.

[The Minister for Agriculture, Fisheries and Food (George Eustice)]

We should not adopt the amendment. I disagree with the shadow Minister—we have chosen to use the term “may” rather than “must” because that is how we draft all of our legislation when it comes to powers to pay. The approach we have adopted is absolutely consistent with our constitution. I want to give the Committee a few examples. The Natural Environment and Rural Communities Act 2006, introduced by a Labour Government, contains the following provision:

“The Secretary of State may give or arrange for the giving of financial assistance in respect of expenditure incurred or to be incurred in any matter related to or connected with a DEFRA function.”

If we go back further, the Science and Technology Act 1965 states:

“The Secretary of State...may defray out of moneys provided by Parliament any expenses which, with the consent of the Treasury—

some things never change—

they may respectively incur”.

The 1965 Act that created powers to make payments uses the term “may”. I know that the hon. Member for Stroud has a romantic attachment to the Agriculture Act 1947, which is a good Act—I have read it. How about this for giving powers to a Minister:

“Where...it appears to the appropriate Minister expedient so to do, or if it appears to him otherwise expedient so to do in the public interest, he may by order fix or vary any such price or other factor as aforesaid notwithstanding that under the enactments regulating the operation of the arrangements in question”?

So “the Minister may” is used throughout the 1947 Act. We are simply being consistent in the approach that we take when it comes to spending powers.

[Simon Hoare]

My hon. Friend is making a strong case. May I say gently that times have clearly changed? The hon. Member for Stroud is probably disappointed by this fact, but times have changed since 1947. It was immediately post-war, rationing was still in place, the understanding of the importance of British agriculture was readily understood between all of the parties, and we were a far less urbanised media, culture and political class than we are today. “May” may have sufficed in 1947 when there was a more common agreement on the importance of agriculture. Given the competing philosophical thoughts bouncing around at the moment, particularly in a post-Brexit environment, what harm would “must” do to the Bill?

[George Eustice]

I disagree with my hon. Friend on this point because, as I said, I was not simply citing the 1947 Act. I also cited the Science and Technology Act 1965, which predated our membership of the EU. Even more recently, the Natural Environment and Rural Communities Act 2006 used “may”, and things have not changed much since then.

[Mr Philip Dunne (Ludlow) (Con)]

My hon. Friend has given the Committee a history lesson on different Governments introducing different powers in different scenarios. To help the Committee, will he remind us whether there is any unifying theme in those three Acts? Which party, for example, was in government on each of those occasions?

[George Eustice]

I think, if memory serves, a Labour Government were in power in each of those three examples. That point is well made. We have to understand the sentiment that lies behind the concern for duties on Government rather than powers for Government to exercise, as is traditional in our constitution. A lot of this stems from the fact that we are leaving the European Union—from a sentiment that says, “Whatever will we do when we have not got the EU to tell us what to do, to impose regulations on us, to launch infraction proceedings against us and to send in auditors to complain about the width of our hedges and gateways or about how we record payments?”

The answer is that as we leave the European Union, we should, as a country, embrace self-government—as we used to, and as we did in the 1947 Act. We should have more confidence in our ability to translate powers in an Act into actions and commitment for Government.

--- Later in debate ---

[Martin Whitfield (East Lothian) (Lab)]

Does the Minister not agree that “must” is a stronger word than “may”? He talks about taking back power and government. We are talking about how it looks to agricultural communities outwith this place. The word “must”, which I agree does not define how much money will be paid, but requires that it be addressed, would surely put agricultural communities in a stronger, more confident position than “may”, which leaves it all up in the air.

[George Eustice]

Ultimately, reassurance is given to people in the farming industry, and others with an interest in the farmed landscape, through manifesto commitments and Government commitments. We have a commitment to keep the agricultural budget at the current level until at least 2022. We also have a manifesto commitment to roll out a new scheme to replace the current basic payment scheme, and the Bill sets out a transition period that implies an ongoing budget well into the future. That is what gives farmers the reassurance that they need, not sophistry about whether we should have the word “must” or “may”. I respectfully suggest that we should pursue the approach to drafting that we have always had, that has stood the test of time and that worked wonderfully well in the 1947 Act and in other Labour Acts since, and accept that “may” is the correct terminology to use, as a point of legal drafting.

I will touch briefly on amendment 45, which is linked, and which the hon. Member for Stroud also addressed. The amendment creates a requirement through changing the word “may” to “must”, converting a power to make provisions for enforcement on issues such as eligibility into a requirement. I simply say to the hon. Gentleman that I do not think it is necessary. We have in this country well established procedures that put enormous scrutiny on the spending of public money. We have the National Audit Office, and codes of governance within the civil service and the Cabinet Office. We have very detailed procedures in place to ensure that we check eligibility and look after public money.

Say we were to introduce a scheme and have no type of enforcement or eligibility checking whatever—literally handing out money. As all hon. Members know, it would not be long before we had National Audit Office reports, Public Accounts Committee hearings and accounting officer issues from within the civil service. The reality is that converting the power into a requirement is unnecessary in the context of all the other requirements that we already make on Government. What we seek in this power and in the Bill—what we need in the Bill—is simply a power to be able to introduce those checks.

I hope that I have been able to give the hon. Member for Stroud reassurance. I hope he will accept the approach taken by previous Labour Governments in such areas and also that the existing drafting—using “may”—is entirely consistent with the past. I hope that he will withdraw both amendments.

[Sandy Martin]

It is a pleasure to serve under your chairmanship, Mr Wilson.

The Bill is intended to facilitate the support of agriculture and the countryside after Brexit. The situation at the moment is that all sorts of supports are in place through the European Union, so all sorts of changes, discussions and votes will be needed to change them. The Government have characterised that process as deeply bureaucratic, but it enables farmers and those engaged in agriculture to know what they will receive money for and how much they will receive well in advance, so that they may make decisions about how to carry out their business.

If the Secretary of State ever decided not to give any financial assistance of any sort to agriculture in this country, that would change the entire nature of our society. It would be inconceivable for the Secretary of State to be able to change the decision to award any financial support to agriculture without the consent of Parliament, yet by making this a power rather than a duty, the Bill does exactly that.

We heard about flexibility and the need for it. The Secretary of State, however, has plenty of flexibility even with our amendments. We are not tying the Secretary of State down to any particular way of offering financial assistance; we are only asking that he should have to do it. The flexibility that remains if our amendment is adopted is the flexibility of our Parliament to repeal the resulting Act if ever it decides to do so. Anything else puts the power to support agriculture in this country in the hands of the Secretary of State and not in the hands of Parliament. I do not believe that people were voting for that when they voted to leave the European Union. I believe that we need to tell the Secretary of State that he “must” give financial assistance to agriculture in this country.

--- Later in debate ---

[George Eustice]

I understand the point my hon. Friend is making, but does he not accept that even if we change the word in the way the Opposition suggest, there will be nothing to prevent a future Government dramatically changing the amount of money they make available? Ultimately, it will always be the job of elected Members of Parliament at that time to hold Her Majesty’s Treasury to account, to ensure that it takes its responsibilities seriously—and to do that whether or not the word is “may” or “must” in this particular Bill.

My hon. Friend will be aware that we have a 25-year environment plan. An environment Bill will come from that, which will set out targets, objectives and commitments to get trends moving in a particular direction. It will give a longer term commitment and buy-in, which successive Governments will work towards.

[Simon Hoare]

My hon. Friend the Minister makes an incredibly powerful and telling point, with which I cannot disagree. Inexorably, that may take us on to potential further amendments or a debate in the other place. I know the Treasury is moving away from ring-fencing, but I think there is a sustainable argument that one can deploy: that a certain percentage of the contribution to GDP created by the agriculture and food sectors should be ring- fenced for precisely the purposes set out here. We have it in other areas of protected expenditure, and for good and clear reasons.

My hon. Friend is absolutely right that if the Treasury is only giving the Secretary of State £5.50 a year to spend, that will not buy a huge amount of agriculture or environmental support whether this legislation says “must” or “may”. There may be future debates during the progress of the Bill about some form of ring-fencing; I make that point, knowing that the Minister and Front Bench Members are alert and alive to the issue.

--- Later in debate ---

[Dr Drew]

It has been an interesting debate. The hon. Member for North Dorset put his finger on one of the strong reasons for moving the amendment. To some extent, we want to fetter future Governments, whether Labour or Conservative. It is important we understand that one of the great changes brought about by Brexit, as I mentioned in my initial remarks, is to agriculture.

Let us be honest: agriculture is a centre point of the EU. We pay a higher contribution because we were not able to change the nature of a pro-agricultural budgetary arrangement. We may have wanted to, but we did not. Now that that is gone, there is a real danger that agriculture will slip further down the Budget agenda—there was no great mention of agriculture yesterday—so it is important to use legislation to bolster the accountability mechanism and to make sure money is spent in this area. I have some knowledge of the history of why we ended up with a cheap food policy, but that policy had two sides to it. It was about keeping the urban proletariat fed, but also guaranteeing farmers that they would get a price, whether through deficiency payments or the minimum income guarantee, given the way in which the Common Market set up its pricing mechanism.

I am sure the Minister has been working overtime on the old word search to find a few “mays” and he has done very well in terms of cherry-picking. Some of us were in Parliament when the NERC Act was passed, and I am sure there are “mays” in it; any piece of legislation will have the word “may”. I challenge him to find one that does not have the word “may” in, but it will also have the word “must”. I will say, with the best of intentions, that to compare the NERC Act with the Bill is to undermine the importance of the Bill. NERC was a very good piece of legislation; it tidied up BOATs and RUPPs and the way in which we had access to our countryside and it set up the replacement for the Countryside Agency. It was important in its own way, but it pales into insignificance in comparison with the Bill, which is about our food, our future health and, dare I say it, the way in which we want the countryside to be protected. Yes, we can find examples of where powers have been used in preference to duties, but most pieces of legislation have some duties at their centre point. The Bill does not.

[George Eustice]

Of course some legislation has duties but my point is that in the context of payment powers, the power to design schemes and make financial payments, “may” is the appropriate word to use. That is what is used in the NERC Act in the context of making payments. Through all of our legislation that relates to agriculture from the Agriculture Act 1947 onwards, that has been a consistent approach to making a payment.

[Dr Drew]

I hear what the Minister says, but of course that has been nothing to do with the British Government. Since the mid-1970s, agriculture has been entirely subsumed within the EU. We have not had any discretion. The budget has been fixed in Brussels, and it has been fixed in the way we had to make our contribution. As the Minister feels strongly, that may be a good reason to get out of the EU, but it is not right to see the Bill as a parallel. This is a very different time. Post Brexit, the British Government will be setting their budgetary arrangement for agriculture, and unless they are compelled, they can just say, “We don’t really want to give much money to agriculture.” That is up to the Government, of course, and it has to deal with the consequences. The Minister quite rightly says that we can repeal anything, but to talk about repealing legislation is a strange way of passing legislation. Let us get it right in the first place.

--- Later in debate ---

[George Eustice]

I very much hope that, like the 1947 Act, the Bill stands the test of time. My point is that a Government hostile to our environment or animal welfare or commitments in these areas could repeal the legislation if they chose to. The hon. Gentleman knows that I was on the leave side, and my recollection is that when he was previously in Parliament, he was on the sceptical side of the Labour party—campaigning against membership of the euro, for instance. Does he not agree with me that this is an opportunity for us to embrace self-government and that we should not fear doing so?

[Dr Drew]

That is a good reason to introduce the Bill, but it is also a good reason to make sure that we have duties at its centre point. If we do not have those duties, all the other things that the Minister has talked about—commendable though they may be—are subject to the whim of the Government, and more particularly the Secretary of State, who may have no time for agriculture. That is quite possible.

We will press the amendment to a Division because we think it is important to make it clear that duties should be at the centre point of the Bill—not throughout the Bill, but on the most crucial part: the financial arrangements and accountability for them. The hon. Member for North Dorset says that the matter will come up on Report, but I dare say that, given what has been said in the House of Lords, their lordships will give this more than a going over.

It is important that we have this debate today. I always used to get really riled when my party was in government and I was told, “Don’t worry, we’ll sort this out in the Lords.” I felt that it was important that we sorted it out in the House of Commons—the democratically elected Chamber. The House of Lords can scrutinise and improve but we should be making the fundamental decisions in this place.

Question put, That the amendment be made.

--- Later in debate ---

[Dr Drew]

That is exactly why we must balance the environmental aspects of the Bill with the reality of farming in those areas. I am trying to identify the issue that the Uplands Alliance asked us to address in the amendment, which is about looking at traditional and sustainable forms of agriculture. As has been said, agro-ecology is a new term, but in many respects it is revisiting the past; it is about how we have always tended to consider farming in certain parts of the world as traditional. How we maintain that landscape—a farmed and managed landscape—depends on a relationship between what is farmed and the environment being managed by those farmers.

The alternative is rewilding or having much larger holdings. In essence, we would end up ranching those holdings; they would have to be on such a large scale because the money would not be there in any other way. That would be deleterious to our countryside, and many farmers who want to remain would have to be moved off the land.

It is important that we have this debate. I support the important agro-ecological points of my hon. Friend the Member for Bristol East, because we are giving the Bill some substance. We disagree with the Government: we need examples of how such agricultural improvement will work and how to deliver it. Many others support the amendments, as my hon. Friend said, such as the Soil Association. In its written evidence, which we have all looked at, the Landworkers’ Alliance very much encouraged this direction of travel, to see how agriculture can be improved, made sustainable and meet our sustainable development goals. We will talk in detail later about climate change, which is central to this debate.

I support my hon. Friend’s amendments, and I make no apology for saying that they improve, as we said we would, the status and clarity of the Bill on how agriculture should move. I hope the Government will look positively at what we are trying to do.

[George Eustice]

It is a pleasure to respond on this group of amendments, which all have in common the tendency, which occurs when a list of purposes such this is published, for a range of organisations to want to be name-checked. They become concerned that unless they are name-checked they are being left out. Allow me to take this opportunity to assure the Committee that all the purposes that the amendments want to include are already included.

First, allow me to set out our approach. We have set out our desired goods, outcomes and overall purposes, which we deliberately kept broad so that we did not miss things out. In clause 1 we have explicitly avoided trying to come up with an exhaustive list of every feature of our environment, every environmental asset and every type of scheme we might do under these purposes. For instance, it is true that the clause does not specifically name-check soils—one of our most important natural assets—or pollinators, bees, meadows or farmland birds. Every single one of those natural assets are assets that we seek to enhance and protect and do well for under the powers that we have within the purposes set out in part 1.

On amendment 72, I assure the hon. Member for Bristol East that I am passionate about soil health, as is the Secretary of State. As I have mentioned, people such as Sir Albert Howard, the great 20th century agronomist, who is seen by many as the father of the organics movement, recognised almost 100 years ago that we could not mine soil and, as he put it, submit it to banditry and take all the goodness out of it—we had to manage it. Good husbandry is all about recognising the cycle of life; the health of our soils is not just about chemistry. It is about not just the NPK fertiliser that we put on a field, but the complex interactions, the humus in the soil, the organic matter. It is a living ecology, not just a growing medium.

We absolutely recognise that, which is why soil features prominently in our policy paper. I guarantee the hon. Lady that when we roll out our new environmental land management scheme, it will have a plethora of interventions and schemes to support good soil husbandry and good soil health, because we know that if we get the management of our soils right, it can have implications for carbon mitigation. It can be a carbon store. It is also the case that if we get the management of our soils right, we can improve water quality and reduce our reliance on synthetic fertilisers.

I reassure the hon. Lady that the Government take this matter absolutely seriously, but we do not agree with the amendment. It is not just that it is unnecessary, because soil is already covered in the purposes in paragraphs (a), (c), (d) and (e) of subsection (1)—as far as we are concerned, soil is covered by a multitude of the existing purposes already—but that it has an unfortunate consequence. Crucially, it would insert, at the end of paragraph (a),

“managing land or water in a way that protects or improves the environment”

the phrase

“and enhances soil health”.

While the intention of the amendment was to broaden the objective to include soil health, in fact it narrows the scope of the purposes. For instance, we might have a scheme to promote and support farmland birds, but it might not be immediately recognisable how that might help soil health. The use of the word “and” as opposed to “or” would narrow the scope in a way that would be detrimental to our environment and would be bad for assets such as birds, pollinators and a range of others. On the basis of that assurance, given my passion for the subject and the guarantee I give that it will be a prominent feature of the new scheme, I hope that the hon. Lady will agree not to press the amendment.

Amendment 49 links to a number of representations, whether from the Uplands Alliance or those in the agro-ecology movement, which suggest that we should include an approach to farming systems. Although I think that is unnecessary, because individual farming systems will be covered by a multitude of purposes that we have already set out, I want to take this opportunity to assure the Committee about some of the things we are looking at.

First, on uplands, we believe that our public goods payment approach has real potential to give a rewarding, viable and stable business model to the upland areas. They are better placed than many farms to benefit from the provisions on, for instance, payments for public access. They are able to help and assist with things such as flood mitigation and there are some quite big environmental schemes they could get into. The uplands could also benefit from issues such as peat-bog restoration. If we adopt an approach based around payment on public goods, we believe the uplands would naturally benefit from that. Of course, they also look after and maintain a lot of our natural heritage—the stone walls, the hedges and the beautiful landscapes—that are referred to in subsection (1)(c). We believe that the existing purposes already cover the uplands, certainly in paragraphs (a), (b) and (c) of subsection (1).

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[Kerry McCarthy]

That all sounds tremendous stuff. We are talking about a limited pot of money, and I am concerned that we will get people with huge stakes who cherry-pick the public goods, doing bits and pieces and getting their hands on quite a lot of that pot of money, with the result that the share for people who farm sustainably across the whole farm and adopt some of the approaches the Minister has mentioned is reduced. Does he agree that we ought to be rewarding those people? I always make an anology with a big company that has a fair trade coffee brand, but 95% of their coffee is not fair trade. However, does it really deserve credit for that 5%?

[George Eustice]

The hon. Lady makes an important point. That is why we have set out clearly that we intend to adopt an approach to payments built around a natural capital principle, so that those who do the most will receive the most reward and those who adopt a holistic whole-farm approach that gives us multiple environmental benefits can expect to receive more than those farmers who say, “We’ll let a corner of the farm that is less productive go”, but not do much beyond that.

The answer to the hon. Lady’s concern is in the way that we price and reward the tariffs for the interventions that we propose. That will be very much in the scheme design, and we have been clear about the principles that we will apply.

By giving a quite detailed explanation of our commitment to explore these farming systems, I hope the hon. Member for Stroud will consider withdrawing his amendment on the basis that it is unnecessary, because it is already provided for in multiple locations.

Amendment 41 is a similar amendment specifically on agro-ecological farming systems—it relates to subsection (2) on support for profitability—which we also think is unnecessary because subsection (2) enables us to support and provide grants for businesses that are starting up in organics or a different agro-ecological system, such as agroforestry. The provision and power are there.

Let me reassure the hon. Lady about some of the things we are looking at. Under the productivity strand—subsection (2)—we are considering whether we can use funds to refresh the county farm model by supporting local authorities to reinvest in their farms, helping with facilitation funding so that the farms are more of a hub for new entrants, and working with them to make it easier to move tenants out so that we have a constant pipestream of new opportunities for new entrants.

Alongside that, we are considering whether that can be broadened beyond the traditional county farm, which has existed for many decades since the war, to include some of the peri-urban farms, which often have links to the agro-ecology movement and are often smaller community-based groups. Where local authorities have land that they can make available, we might be able to support the fostering of those schemes, which can be popular.

I hope all the amendments are probing and that we shall not find it necessary to divide the Committee. I hope I have been able to reassure Members that the issues that they sought to highlight in their amendments are already provided for in the Bill.

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[Dr Drew]

I beg to move amendment 50, in clause 1, page 1, line 11, after “(d)”, insert

“limiting greenhouse gas emissions from agriculture or horticulture or encouraging activities that reduce such emissions or remove greenhouse gas from the atmosphere, or”.

This amendment would add to the purposes for which financial assistance can be given that of limiting greenhouse gas emissions from agriculture or horticulture or encouraging activities that reduce such emissions or remove greenhouse gas from the atmosphere.

I shall endeavour to speed up a little, but again this is an important part of the legislation because it refers to climate change. To be fair to the Minister, climate change appears in subsection (1)(d), which refers to

“mitigating or adapting to climate change”.

We accept and are willing to support that, but we wish to improve on it by adding the words in our amendment.

Again, this is important. If we are serious about a new Agriculture Act, we ought to be serious about how it impinges on climate change. Those are not my words but the words of Lord Deben, that well-known socialist former MP, now in the Lords, John Gummer. Some in the Committee heard, as I did, what he said in the Attlee Room when he introduced the report of the Committee on Climate Change. He was rather scathing about the way in which agriculture has failed to meet its targets for reducing emissions. He was overall pretty sceptical about the Government’s performance—as he can afford to be, given how deep-seated he is in this place—and was particularly critical of agricultural emissions having flatlined, which is not good enough.

The Opposition make no apology for tabling the amendment. We have done so to give some bite to the Bill and make climate change the fulcrum of how agriculture performs so that we see those improvements. Not only have agricultural emissions in general flatlined, but net carbon sequestration from forestry has flatlined. The United Nations has produced a report through the Intergovernmental Panel on Climate Change, saying, “Forget 2 degrees. We should be worried about even approaching 1.5 degrees.” We can play our part by being serious about this issue and passing this simple amendment to ensure that we can do what clause 1(1)(d) says:

“mitigating or adapting to climate change”.

I hope the Minister will take note of what we are saying. The amendment is a minor change in wording but makes the important statement that agriculture has to play its part in dealing with climate change. As Gilles Deprez said when giving evidence to this Committee, he strongly believes that farmers are already paying the price for climate change, and dealing with it is not just something that they should do for the wider community. They are already suffering the effects of climate change, as we have seen this year with the drought. I am not saying that droughts are anything other than climatic occurrences that have happened through the ages, but those climatic events—whether floods, drought, or very cold winters that mean that farmers are unable to plant when they want to, let alone harvest when it is very wet—come around far too regularly for them to be anything other than an aspect of climate change.

I hope we can reach some agreement on this issue. Given who sits in the House of Lords, those Lords will spend an awful lot of time talking about this aspect of agriculture, so the Minister might as well be prepared. He cannot influence proceedings in the Lords, but whoever takes this through—presumably Lord Gardiner—will be spending a lot of time trying to deal with various people, whom we could name, who will be saying, “Come on—sort this out. We need to have some words in the Bill that show how agriculture is prepared to play its part in dealing with climate change.”

We know that farmers do not necessarily have the resources, expertise or access to investment that they need, so again, let us hope that that is where the money will go. It is crucial to deliver the budget in a way that allows farmers to make those changes. We heard in a previous debate about agro-ecology that this issue is linked to soil quality, water management and the way in which farming systems need to change to take account of emissions. Not including this amendment in the Bill would be a missed opportunity, and again I make no apology for introducing it. Climate change has to be taken seriously, including in the Bill.

[George Eustice]

I can be fairly brief, because I have already spelled out some of the principles behind Government’s approach. As the shadow Minister acknowledged, subsection (1)(d) includes a simple but clear purpose, which is

“mitigating or adapting to climate change”.

Why have a long, cumbersome sentence of 29 words when six words will suffice? His wording—

“limiting greenhouse gas emissions from agriculture or horticulture or encouraging activities that reduce such emissions or remove greenhouse gas from the atmosphere”—

can be summarised as “mitigating climate change”, and we already have that term in subsection (1)(d).

--- Later in debate ---

[Jenny Chapman]

I am not completely convinced by the Minister’s response. Mitigating is about lessening the impact of climate change. It is not about preventing it. We are trying to reduce emissions and the impact on climate change of agriculture and horticulture. They are different things. It is not true that the only difference is the length of the sentence.

[George Eustice]

On the terminology, we are not talking about mitigating the consequences of climate change. The subsection is very clearly about mitigating climate change itself. Any action that is taken to reduce carbon emissions and the emission of other greenhouse gases—ammonia is a very important one in agriculture—would be mitigating climate change. The subsection also includes the phrase “adapting to climate change” in recognition of the fact that, as Gilles Deprez pointed out in the evidence session, we are already living with the consequences. For instance, we recognise that we tend to have more floods, so we may need schemes to manage the implications of that. “Mitigating climate change” means what it says. It can include any actions that reduce greenhouse gas emissions.

[Jenny Chapman]

That is not right. Mitigating does not mean that. It means to lessen the severity or the impact of something. What the Minister is doing in the clause is very different to what we seek to achieve. The definition of “mitigating” matters.

--- Later in debate ---

[George Eustice]

I do not agree. We recognise that climate change is happening, and everything we are doing to tackle it is about mitigating an event that we recognise is happening. Our efforts to change the mix of our energy, reduce carbon emissions, encourage the uptake of electric vehicles and so on, are all about mitigating the problem of climate change. Subsection (1)(d) has a very clear purpose, and it enables us to do all the things that the amendment seeks to achieve. I hope we can use this debate to clarify that. I have given a long list of the types of interventions that we intend to explore, pursue and pilot under subsection (1)(d).

[Kerry McCarthy]

I am slightly disturbed by something the Minister said almost in passing. He seemed to be saying that the only problematic issue relating to the importing of soya is the shipping miles. I hope he has read the evidence, including the UN report “Livestock’s Long Shadow”, work by Chatham House and the Intergovernmental Panel on Climate Change’s report last week, that shows that the carbon footprint of the industry goes way beyond shipping miles.

[George Eustice]

Yes, and I did not seek to give a fully detailed exposition of the impact of soya, but the progress that some sectors—notably the pig sector—have made in reducing their carbon footprint has been by reducing their reliance on imported soya. The hon. Lady is right that it has a range of impacts on the environment.

I recognise the intention behind amendment 50, but I think it would only lengthen subsection (1)(d) without adding any meaningful change. I hope I can reassure hon. Members that the powers outlined in the subsection already enable us to do what we all seek to do on gas emissions.

[Dr Drew]

What the Minister says is laudable, but it takes us back to the problem of powers and duties. The Secretary of State does not have to do any of this. The simple fact is that, according to the Committee on Climate Change, agricultural emissions are not on track to deliver the carbon budget savings required by 2022. Amendment 50 may be wordy, it may be an addition and—as my hon. Friend the Member for Darlington says—it may lead us to argue about what “mitigation” means, but we tabled it because at the moment there is no guarantee that agriculture will play its part in dealing with climate change.

The reality is that unless we put some teeth into the Bill, either the Government or, dare I say it, farmers will not have to do anything. We are putting the onus on farming and farmers to deliver their contribution towards reducing emissions. There has been much good work, but the fact is that agriculture’s contribution has flatlined. We have to do something about that, so we make no apology for saying that we will press our amendment to a vote. The issue will come back to haunt the Government in the House of Lords, where countless Members will make the point that agriculture has not reduced its emissions as it should have, so we must place an obligation on it to ensure that it does.

The Opposition believe strongly that the money that will go from direct payments into environmental support has to target emissions reduction, so the wording is really important. I hope that all hon. Members will think about the matter, because it will be brought back to the House. It will be important not only to this Bill but to the forthcoming environment Bill—I do not know what will be in that Bill, unless it says that we will actually reduce emissions. Whether it is in this Bill or that one, that commitment has to be there.

Without further ado, I ask for a vote on amendment 50. We make it clear that if the Government will not yield on these words now, they will have to yield on similar words later.

Question put, That the amendment be made.

Agriculture Bill (Third sitting)

George Eustice Excerpts

Thursday 25th October 2018 Public Bill Committees

[The Chair]

Good morning, ladies and gentlemen. The Minister will move an amendment to the programme motion agreed by the Committee on Tuesday.

[The Minister for Agriculture, Fisheries and Food (George Eustice)]

I beg to move,

That on Thursday 25 October, after hearing oral evidence in accordance with the motion agreed to by the Committee on Tuesday 23 October, the Committee shall hear oral evidence from the following until not later than 4.30pm—

(1) Ulster Farmers’ Union;

(2) NFU Scotland;

(3) Scottish Government;

(4) Quality Meat Scotland.

I wish to record my thanks and that of the Committee to the patient Clerks, who have made accommodations following late requests for additional witnesses.

[Dr David Drew (Stroud) (Lab/Co-op)]

On a point of order, Sir Roger. Simply put, we need to hear from the Rural Payments Agency and the Groceries Code Adjudicator. The one thing that came out of our earlier sittings was that no one quite knows how what is in the Bill will work, so we need to know from the extant organisations—they might be replaced, but that is something for the Government to decide—exactly how they think they will operate. I ask for another sitting to hear witnesses from those organisations. They might not be able to come, because of the short notice, but they should be called to account. I hope that would be agreed unanimously.

--- Later in debate ---

[The Chair]

Thank you for joining us. As always, I am afraid we are playing “beat the clock”, but we will do our best to ensure that everybody has a fair hearing. For the record, please introduce yourselves, starting with Professor Fox.

Professor Fox: Good morning. My name is Pete Fox and I am director of water, land and biodiversity at the Environment Agency.

Helen Taylor: Hello, I am Helen Taylor and I also work at the Environment Agency, where I am programme managing our input to future farming.

John Cross: Good morning. I am John Cross. I am a farmer by trade, but I also chair the Department for Environment, Food and Rural Affairs tuberculosis eradication advisory group, and I chair the Traceability Design User Group for the industry and DEFRA.

[George Eustice]

Q 102 I would like to begin with a question for Mr Cross. I know you are involved with the Traceability Design User Group. A key section of the Bill deals with powers that would enable us to gather more data and information from anyone in the supply chain, including farmers. Can you set out what types of information you would like, or in what way you would like Government to use the provisions in the Bill, to support the important work that you are doing?

John Cross: The industry—the whole supply chain—has been mindful for many years that the flow and sharing of data within the supply chain has been virtually non-existent. In the past, the Government have had powers to collect data that they needed for statutory purposes, such as notifiable disease, food chain information and food safety. Those statutory needs were catered for, but for many years the supply chain itself has suffered from the weakness that comes from an absence of data in that supply chain. Data is important for eradicating endemic diseases, which hold back the productivity of the national herds and flocks, and for evidencing the provenance of products for international and domestic markets. Obviously, it is in everyone’s interest to be able to stamp out exotic disease in a hurry, should it flare up. Evidencing provenance in the supply chain is important for international trade opportunities, where international customers’ No. 1 question is always about traceability and the availability of information about the product.

We are not well equipped as a supply chain at the moment at all. In fact, the industry has come to the conclusion, fairly rapidly since the referendum in 2016, that it needs to think very differently about its future. It needs a lot more information to manage its supply chain a lot better. It needs to rid itself of endemic disease. It needs to explore the best possible portfolio of opportunity in the global and domestic market. It needs more information about itself, to enhance those efficiencies, drive out disease and trade with a very good evidence base about its product.

[The Chair]

Thank you. Ms Taylor and Professor Fox, if you wish to add anything, please feel free to do so.

[George Eustice]

Q At the moment, we have something of a hotch-potch of different pieces of legislation and different systems covering all sorts of different species. There is a different system for cattle, pigs, sheep and so on. Could you explain what you think the common characteristics of a new, single, integrated animal ID and traceability system would look like?

John Cross: Yes, indeed. As people may or may not know, for the three production species—cattle, sheep and pigs—at the moment there are three different systems. In the main, except for the pig system, they are almost entirely paper-based, with all the problems of workload and cost that go with that.

For the last 20 months, the industry and Government together have formed a group called the TDUC, which is part of an aspiration for a completely new digital livestock information service, and for 20 months Government have been working alongside industry and all the DEFRA agencies, such as the Food Standards Agency, the Rural Payments Agency and trading standards—everyone who has an interest in livestock welfare, livestock health, livestock movements and traceability, food safety and product authenticity.

Anyone involved in those areas of work is involved in what is a co-creation partnership that, for the last 20 months, has worked to design what we intend to be the new livestock information service, which will be a multi-species, paperless, digital information service that will eventually be real-time and comprehensive. That is where these particular data-collection and data-sharing powers will come in—to be the lifeblood that makes the system work. That will probably be the biggest step change that certainly the ruminant livestock sector in this country has seen in many decades.

The pig industry, which is rather more integrated and further down the road than the ruminant sectors, is part way there, but being part of a single system will add value to it as well. This will certainly be the most enabling action that industry and Government could jointly make to make the ruminant livestock sector fit for purpose for the future. That is certainly a view strongly held by the industry itself.

[George Eustice]

Q A final point: if we got that right and had a single, coherent system, what impact do you think that might have on our market-access efforts in other countries, in terms of giving reassurance to overseas veterinary authorities?

John Cross: Over the years, I have been quite heavily involved in international trade development, and one of the things that struck me in the south-east Asian markets that people talk about, and particularly in China, where there are huge opportunities, is that when you sit in front of Chinese veterinary officials and talk to them about market access, their primary and secondary questions are all about proof of traceability, evidence of traceability, evidence of centrally co-ordinated disease control strategies and data. They talk about product quality and price et cetera at a much lower level later. Any of the big markets we would aspire to balance our whole trade picture with would challenge us on evidencing traceability —that would be their very first question.

Indeed, if we actually look at our proposition, as an English industry out there on the global stage, you cannot get away from the fact that all the other big meat-producing economies and traders have either already done what we are doing or are in the process of doing it now, at pace. I strongly believe that in this country we produce some of the best—if not the best—meat products in the world, but the challenge from future customers and competitors will be to prove it. At the moment, our system creaks and struggles to do that, whereas with the powers that we seek, that would be a real-time service that could be demonstrated digitally anywhere in the world, and that would put us completely on the front foot.

[Dr Drew]

Q Good morning, everyone. A simple question: to make the Bill work, what additional enforcement powers will be needed, and do you think that they should be in the Bill or in subsequent statutory instruments?

John Cross: To completely enable our vision of the livestock information service, your data has to be complete —you cannot function with half or sub-optimal data. If you are eradicating disease, and that is your focus on that particular usage of data, then unless it is complete, you will not achieve your goal. At the moment, DEFRA has powers to collect data for statutory purposes, but it doesn’t actually have the authority to share that data and to allow people within the supply chain to make use of the data.

There are a whole lot of opportunities for farmers themselves. For instance, there is at the moment a desperate need for farmers to make informed purchasing decisions about whether the cattle they are buying have come from a TB high-risk area or an edge area, or whether they are going to a low-risk area. That whole area of risk-based trading—for any disease, not just tuberculosis—needs information. You cannot manage risk without data. You need the ability to collect data in a complete format from everyone, and then you need to be able to share it so that farmers can access it easily and quickly and it is available in the supply chain. That is what is different—the collection of complete data and making it available.

Professor Fox: First, I would like to say that the Bill provides a really good framework for taking the whole agriculture sector forward. It has a lot to commend it, particularly the provision for payment for public goods and the recognition of a need to transition the sector into a new place.

In terms of the things around regulation enforcement that we would like to see, from an environmental perspective, the Bill could provide an opportunity to have a clear and simplified regulatory baseline. At the moment, we have a series of maybe four key pieces of legislation that are applied disparately, and the Bill offers an opportunity to provide farmers with a clarified and simplified view of what is required of them. I believe that will lead to better conversations between farmers, suppliers and ourselves about what is expected.

Within that, it should be recognised that the provision of environmental goods or public goods should be contingent on compliance with that regulatory baseline in order to give the public confidence that their money is invested in farmers and in outcomes that are genuinely provided in a healthy and vibrant countryside.

--- Later in debate ---

[The Chair]

Before I revert to the Minister, are there are any more questions from the Back Benches? No.

[George Eustice]

Q I want to come back to a point that Professor Fox made earlier about regulation. You will be aware that the Government have commissioned Dame Glenys Stacey to do a comprehensive review of the regulatory baseline and the culture in which we carry out enforcement. We envisage that that will be something for future legislation.

On the specifics of the schemes we have now, is not the issue you raise covered by clause 3? It is explicit that, through regulations, the Secretary of State can set eligibility criteria for the new schemes, enforce compliance with the new schemes, make requirements about record keeping, have the power to recover financial assistance and even impose monetary penalties and create offences. That is a pretty comprehensive set of enforcement provisions to sit alongside a new scheme.

I take your point, and the Government accept that we want to review the regulatory baseline and the culture. However, for the purpose of the schemes outlined in the Bill, do you not think the issue is covered by clause 3?

Professor Fox: I agree that clause 3 has an awful lot to commend it, and I believe that is the framework on which the environmental regulations could be hung. Our aim is to ensure that there is clarity for farmers as well as regulators on what we are seeking to achieve together for the future. In that respect, the clause provides the powers and responsibilities—the opportunity for Ministers to make those schemes and those decisions. However, a bit of clarity in the Bill on the direct linkage of compliance with the environmental baseline, being a prerequisite of getting money for public goods, would make a clear statement about the Government’s expectations for the industry. We are contributing fully to the review by Dame Glenys Stacey, as you know, and we look forward to helping the Government to interpret and determine how they want to take any of those forward in any case.

[George Eustice]

Q But is it not your reading here that through this, the Secretary of State has the power to say, for instance, that an eligibility criterion would require you to be compliant with the existing legal baseline?

Professor Fox: I agree that it gives the Ministers the choice of doing that.

[The Chair]

There are no further questions. Thank you Professor Fox, Ms Taylor and Mr Cross for coming to join us and for your evidence, which is greatly appreciated. Thank you very much indeed.

Examination of Witnesses

Jack Ward and Helen Browning OBE gave evidence.

Agriculture Bill (Fourth sitting)

George Eustice Excerpts

Thursday 25th October 2018 Public Bill Committees

[The Chair]

We are very grateful to you for joining us.

[The Minister for Agriculture, Fisheries and Food (George Eustice)]

Q 145 The premise behind the Bill and the future of direction of agriculture policy is to move away from arbitrary area-based subsidy payments to a system based on payment for public goods. What do you consider to be the main criteria or factors that we need to take into account as we design schemes under that principle, to make them successful?

Vicki Hird: We very much welcome that move—we have been calling for it for a long time. We would make sure that it enables payments that can deliver a truly sustainable farming and food system, so that it delivers good, healthy and affordable food to people as near as possible to where they are. We would look for a broadening of the payments to make sure that people can actually afford food locally in local markets. We think that the outcome has to be measurable and the payments have to be accessible.

We have talked about having some sort of way in which governance can be defined at local or even regional level, so that you are both covering landscape or catchment-scale outcomes where possible, and making sure that you are truly covering the environmental outcomes that we need to see, including on climate change. That means covering not just edge-of-field features that might be very visible, but also making sure to cover in-field farming systems. We would like to see an outcome that supports agro-ecological systems, such as organic and whole-farm systems that truly look in the field to tackle some of the worst pollution and environmental problems.

[The Chair]

Professor Millstone, you are nodding. Would you like to come in on that?

Professor Millstone: I think that the move away from area payments is entirely sound, but the current interpretation of the notion of a public good seems to me to be far too narrow. It certainly does include those things currently on the agenda of the Department for Environment, Food and Rural Affairs, but I think it ought to include, in particular, stability of supplies and prices. While there have been—and there remain—many problems with the common agricultural policy, it has at any rate ensured relative stability of supplies and prices. EU consumers have been paying a premium above world market prices, but they have been getting stability. World market prices are typically far more volatile than those in the European Union, and I think that there is a need for policy measures to ensure supply and price stability, as well as other things, including improved safety, improved nutrition and, when it comes to sustainability, greater clarity on what is to be sustained.

Professor Marsden: There is a real opportunity to set this in stone—it is almost a bipartisan, non-political issue—and build real consensus around integrated food, agriculture and environmental policy in the rural domain. The short bit of evidence I submitted suggests an amendment at the top of the Bill that would interlock what is already there, which is fine, with questions about food security, self-sufficiency and sustainable production. In 1947, we had principles of efficiency and stability, which are just as significant today, but they have changed their expression. Some key principles like that need to be embedded in the vision of the Bill from the start.

David Baldock: I had the pleasure of producing, with colleagues, a study for the Directorate-General for Agriculture and Rural Development—DG AGRI—in the Commission in 2010 on what public goods in agriculture were. It took two years, it was a highly political operation, and we had agricultural economists all over Europe working on it. It is not easy. Intrepid Members might want to look at it.

One of the things we learned was that we must have clear objectives and be clear about what public goods are. They are, by and large, above the regulatory baseline. It is not just about trees and hedges; it is to do with the whole resource base for agriculture and land management. We must be clear about what payments mean. They provide farmers with opportunity costs, as well as other costs. Farmers often perceive public goods as a very unprofitable sideline. Actually, they are much more to do with the holistic management of the farm and the resources beneath it. Maintaining your resources in the long term is important for public good provision.

If you want farmers to take this seriously, they need to know that there is money behind it. Perhaps we can come back to that. They need to know that this is a long-term policy direction, not just a short-term measure. Otherwise, it is difficult for them to have confidence in it.

You need some means of measuring the outcome. Clearly, that involves having a monitoring process and some confidence about the indicators you are talking about. At the end of the day, public goods need to be visible and understandable to people. They are just shorthand for policy makers; we need to make the benefits clear to the whole world.

[George Eustice]

Q Going back to Professor Millstone’s point about markets, I will put a few propositions to you and then invite your views on them. Part 4 of the Bill obviously has a sweeping section on intervention in agricultural markets. The Secretary of State can declare a crisis in the market and act accordingly. That is largely borrowed from the existing EU regime. Our most stable areas of production, where we have very competitive prices and compete internationally, are often the unsubsidised sectors, such as pigs, poultry and horticulture. Finally, the single farm payment is explicitly decoupled from production at the moment, so you do not really have to be producing food in any kind of productive way to qualify for it. Beyond part 4, which is about intervention, what other things do you think we need in order to provide stable food prices?

Professor Millstone: Part 4 strikes me as essentially being about therapeutic responses to crises that have already emerged, whereas I think it makes much more sense to have a more prophylactic, preventive approach, and to take measures in advance of crises to ensure stability. Although the area payments are decoupled, they none the less reduce total costs for producers, so they contribute to the maintenance of farm incomes and give incentives to remain actively producing food.

There have been mechanisms that have operated to stabilise prices in UK agricultural markets, which did not have the adverse effects characteristic of the common agricultural policy—the creation of large surpluses. The deficit payment system, which applied in the UK before we joined the European Economic Community, gave farmers a minimum price for commodities, but only for products that they produced and found a buyer for, so it stabilised prices and farm incomes but did not generate surpluses.

Vicki Hird: We want clause 1 to ensure that farms can continue. One of the ways it should do that is to ensure that the farming system is resilient and robust against the shocks that might hit it. That would include ensuring that the natural base is healthy—the soil, the water and the animals, as system-based resilience factors. It also should ensure that they are diversified if possible, ensuring that they are fulfilling the potential to have import substitution in areas such as horticulture.

We are keen to have a public health purpose in that section, which I do not think is strong enough yet. We are calling for a public health clause because we see a great benefit in boosting the sectors that are good for public health and changing the sectors that are not. That will mean diversifying and making the farming system more able to withstand shocks, because farmers will not be putting all their eggs—to use the wrong phrase—in one basket.

[George Eustice]

Q Professor Millstone, you are advocating something similar to the deficiency payments that used to be in the 1947 Act. Do you think that in a modern incarnation of a new agriculture policy it is the role of the taxpayer to do that? Or should Government, as we do in the Bill, improve the transparency of market information so that you can get the development of futures markets or margin insurance, so that there is a viable, accessible product that farmers can access to insure their own prices?

Professor Millstone: It is not just about stabilising farm incomes, but about ensuring adequate supplies for consumers. Futures markets, insurance and so on can create what is conceived of as virtual stocks, but you cannot eat virtual stocks—you can only eat real food. Therefore, you have to have mechanisms to ensure that there is an adequate supply of real food available, and not just financial instruments.

[Dr David Drew (Stroud) (Lab/Co-op)]

Q Notwithstanding what you said about clause 1, Vicki, if you had a crystal ball, how else would you improve the Bill?

Vicki Hird: We have suggested two additions to clause 1 to deliver a truly sustainable farming Act, which is what we want. We want to bring public health and agro-ecological whole farm systems, such as organic, to the fore.

One of the fundamental things that we think the Committee and MPs need to drive—I feel slightly emotional being here because you have such an incredible opportunity and a responsibility in your hands—is to make the Bill far more robust in terms of duties. One of its weaknesses is enabling; we all said it would be an enabling Bill and the Government do not want their hands tied. As a result, we are extremely concerned that after a few years when there are pressures on the Treasury, there will not be the money to do the kinds of things that we have identified externally as absolutely essential but that the Government have not.

These are things that we know need to happen: we know we need to tackle climate change, soil erosion, animal health and welfare, antibiotic use and obesity. They are all big crises that we need to deliver on, but there is no obligation in the Bill to tackle those things. Ministers want to, but it could all fall apart. It would be adding duties and the responsibility to do those things and the ability to draw down a budget against assessment of needs from all those things, so that the Bill delivers the truly sustainable, healthy, nature-friendly farming that we know we can deliver—a lot of farmers are doing it. The Bill could be truly great if it had those duties, rather than lots of enabling.

We would also like clause 25 on fair dealing to be strengthened. We are really pleased to see it there but we have some specific amendments to it, which we can provide the Committee, on ensuring that it provides the confidentiality for people who need to complain about bad treatment and that it covers all sectors. Again, the duty of the Secretary of State to deliver the new fair dealing measure is crucial, for the reasons that Mr Eustice described, to ensure that farmers can have confidence in the market.

Professor Marsden: To add another issue, on the question of how to improve the Bill, there is nothing in it about rural development, which is important. This is an opportunity to link multifunctional farming, which seems to be where we are heading, with rural development. I am suggesting not the development of a second pillar necessarily but, for example, for the recipients of financing and whatever funding there is not to be restricted to farmers alone. It could go to partnerships, place-based partnerships—some good pilots of which are going on in England and in Wales—and consortiums of landowners and stakeholders in rural areas to work together.

That is the other shift we need—in the mentality of funding for public goods. Rural development forms a gap in that. One might argue that that could be left to whatever comes out of the shared prosperity fund. I am, though, concerned about that, because it might lead to concentrated dollops of funding—to cities mainly—and we really need much more distributed, bottom-up and facilitative funding for things like a post-Brexit LEADER programme.

David Baldock: First, to follow up on that and to amplify what Vicki said about duties as well as powers, I noticed that the House of Lords Delegated Powers and Regulatory Reform Committee pointed out that 36 clauses in the Bill confer 26 powers on Ministers, but include hardly any duties. At the moment there is a duty on the Government to introduce and operate agri-environment schemes, but even that duty is going. We are actually moving backwards on duties.

Secondly, on the budget issue, I understand that the Treasury does not like to have its hands tied and so forth, but we are in a position here that there is no guarantee whatever of multi-annual funding for agriculture. Lots of sectors have special pleading here, but the fact is that farmers do not work on a CSR—corporate social responsibility—cycle; they are not investing on that timescale. Therefore, either in the Bill or through some parallel commitment, it is important—there is a lot of sectoral join-up here on the environment and farming sides—to have some kind of forward-looking structure. That is not just a five or 10-year agreement for an individual farmer, but some sense of where things are going for the industry and infrastructure, and how we are going to meet future Government objectives.

Thirdly—a point that has not come up yet—at the moment the Bill contains nothing about the regulatory baseline, the environmental baseline, for agriculture in future. I understand that that might come forward in separate legislation, such as the environment Bill, but it might not—that Bill might not happen. There is the possibility, which is slightly more than theoretical, that farmers take up the de-linking option, the payment option, under the scheme, therefore finding themselves outside cross-compliance and outside good agricultural environment condition, which means that the baseline in those circumstances—without having a position in law—will be weakened. In fact, we could go back from where we are now. Good agricultural environment condition is a very important part of cross-compliance. It was our major means of protecting soil, so it is the only means of protecting soil through the public sector at the moment. I want to emphasise—although we all know this—that it is a key area that should not be forgotten.

--- Later in debate ---

[Deidre Brock]

Q Should some sort of distinctions be placed in the Bill specifying that? I did not quite hear what you said—are you saying that that would limit the Bill too much?

Vicki Hird: If it was only for the active farmer and food production; if that was the only basis on which you could get any support at all.

Professor Marsden: A key word here is “productivity”, isn’t it? That needs to be in the Bill, but we need a broader definition of what we mean by productivity. We can see—we have evidence—that we can get productivity out of small agri-ecological farms. You can create demand for labour out of those activities. You can create much more work. So we need to redefine the notion of productivity in a much broader way to cope with this variation across the agricultural landscape in the UK.

Vicki Hird: Yes, because they might be producing good carbon capture. There are other ways of measuring.

[George Eustice]

Q I will be brief, Sir Roger, because you want to keep us to time. Part 2 of the Bill creates the power—quite a large one—to modify and sort out existing schemes, to remove some of the bureaucracy, to simplify them and to sort out mapping. If you had one or two—perhaps this is for Mr Baldock because you have had some experience of them—what would you do to clean up and sort out the existing basic payment scheme?

David Baldock: The main difficulty with the current CAP regime is its bias towards control of very often the wrong thing—micromanagement of farm boundaries and of the way data is gathered and reported. Instead of getting the big picture of what is happening on a farm and how it is complying with its broad obligations, we have a highly burdensome system that, at the end of the day, does not really add a lot of value to the public purse or public transparency. It would be very welcome if the Government were able to shift that whole delivery system so that it focused on real outcomes and was more farmer friendly.

I was involved in the beginning of the cross-compliance discussion in Brussels. At that time, the whole idea was to take out the very worst farmers—to put under scrutiny people who committed large-scale abuse of livestock and so forth. It has become a micromanagement tool for worrying about individual farmers, with ear tags for livestock and a whole process around that. It has completely disappeared into a bureaucratic process. There is a great opportunity here to change that culture and delivery system.

[The Chair]

There is a lot of nodding going on, but Hansard cannot report nods, so I have to place them on the record for you. I am afraid we are out of time. Professor Millstone, David Baldock, Vicki Hird and Professor Marsden, thank you very much indeed for joining us. We are most grateful to you.

Examination of Witnesses

Diana Holland and Ed Hamer gave evidence.

--- Later in debate ---

[Dr Drew]

Q So where do you see opportunities to improve the Bill?

Diana Holland: We think a clause should be added that specifically recognises the need to protect standards for agricultural workers. Sustain is supporting an amendment, which we would be happy to be attached to, on the kind of protections that the former Agricultural Wages Board provided. We recognise that this is a framework Bill and there are different ways of expressing things, but in the absence of anything at all we would want something very specific to be added that would recognise that matter. This is meant to be dealing with Brexit, and the treaty of Rome specifically says in article 39 that there should be a fair standard of living for workers in agriculture.

We have seen with the abolition of the Agricultural Wages Board in England a deterioration in pay. You would expect us to say that; we are trade union representatives. We have collected evidence from our membership that in the year after the abolition, 56% of those surveyed had not had a pay rise. Of those who had had a pay rise, 82% had had it imposed, and of those who had not had a pay rise, one third had gone to their employer to ask for a pay rise and been refused. A series of people formerly covered by the Agricultural Wages Board in England have had their pay completely frozen until the national minimum wage catches up with it, whereas in Wales, Scotland and Northern Ireland that is not the case.

In fact, just this month, the estate agent and land management advisers Strutt & Parker said in Farmers Weekly:

“It is difficult to justify suggesting that English employers should pay their employees less than they would receive if working in Wales—particularly given the shortages in skilled labour the sector is facing.”

They have recommended pay rises of 2.5% to 3.5% to deal with what is happening in England. That is a very specific example, but the unintended consequence—or perhaps, given the estimates made at the time, a recognised consequence—of the abolition of the Agricultural Wages Board is that conditions on not just pay but sickness, holidays and all the other things that were protected are deteriorating. We are extremely concerned, and there is an opportunity in this Bill to look at what is happening. If we are going to deliver decent agricultural production for the future, we need workers who are recognised and remunerated effectively. Without that, we are in serious danger of not being able to deliver in the way we should.

Ed Hamer: We see a clear opportunity for improvement in clause 1(1), and we have tabled an amendment on agri-ecology. At the moment, the Bill replaces direct payments with environmental land management payments, which in their current form do not guarantee food production in addition to the delivery of public goods.

By contrast, the agri-ecology amendment would focus on holistic farming systems as opposed to set-aside or marginal conservation measures. To give you an example, the payment identified under ELM would pay farmers for income forgone on the field boundaries, whereas in the middle of the field they could continue to spray pesticides or cease farming altogether. With the agri-ecology amendment, the integration of whole farm agriculture and agri-ecological principles would incentivise farmers to produce food on the field in addition to introducing ecological focus areas or diversity around field edges. Under the agri-ecological amendment, it is the farming system itself that delivers the public good.

[George Eustice]

Agri-ecology and other whole-system disciplines such as agroforestry would be covered and empowered under clause 1. We are considering that, but I would be interested in your views on the key barriers to your members’ setting up and what type of support would be most useful.

Ed Hamer: The majority of our members are farming on smaller acreages, typically anywhere between 1 and 20 hectares. At the moment our biggest challenge is access to markets. Over the last 20 years or so there has been significant under-investment in the infrastructure needed to support small-scale enterprises such as ours; I am thinking of local abattoirs, local creameries, food processing infrastructure, seed networks and things like that. What would really help us is targeted support for local food funding, to recognise the networks and infrastructure required to get the food from the farm to the market.

To give you my example, I farm a community-supported agriculture scheme in Devon, which we started in 2010 without any money. We got a grant from the Big Lottery Fund and were able to invest in polytunnels and the infrastructure required to get our operation up and running, including the machinery that we needed and a delivery vehicle. With that small grant, we managed to build a business over a relatively short amount of time. We are now independent of grant funding.

Our experience teaches us that our members have had similar challenges, but not all have been fortunate enough to secure an initial capital grant. For local food grant funding, seed funding for SME agricultural start-ups would be a fantastic way of getting small enterprises up and running, to the point where they can be financially independent.

[George Eustice]

Q What about access to holdings—access to land?

Ed Hamer: Access to holdings has been significantly undermined by the BPS, which has, to a certain extent, consolidated land ownership in the UK over the past 10 years. Many of our members struggle to access land because land prices have gone up by about £2,500—depending on the area of the country—since the introduction of the BPS.

We hope that the end of the BPS and area payments will have some knock-on effect on land prices. If not, we see opportunities within the de-linking, if we could make a condition of it that land should be made available to new entrants. Using the county farms estate would be a fantastic opportunity to provide opportunities as the first step on the farming ladder.

[George Eustice]

Q Could you expand on that? We have said before that we are looking at refreshing the county farm model. What would you like to see?

Ed Hamer: For many new-entrant farmers, it is quite intimidating to take out a mortgage to buy their own holding and to then try to pay that money back through farming itself. With the county farms estate, there is still the opportunity to rent a small area to start on, even if it does not come with accommodation and is just the land itself, and to then build up a business and a local market for products, to the point where a farmer can start to invest in their own land or find somewhere else to move on to.

As a stepping-stone measure, the county farms estate is a fantastic resource that has so far been under-utilised. It has been very positive to see DEFRA’s soundings on reclaiming that estate for use by new entrants.

[Deidre Brock]

Q What concerns do you have about the possibility of standards being lowered for imported food? Witnesses have referred to that already quite a lot. Mr Hamer, your website makes it clear that there is a real shortage in the supply of domestic produce, and that, if new recommendations to eat more fruit and veg were actually followed, current production could not keep up. Would cheap imports fill that gap?

Ed Hamer: We like to think not. Horticulture is quite a unique example. At the moment, in the UK horticulture receives less than 1% of public funding. Since 2005, horticultural production has declined significantly—veg by 26% and fruit by 35%. At the moment, we import 42% of the vegetables and 89% of the fruit that we consume in the UK.

Post-Brexit there will clearly be an opportunity for renewal within the horticulture sector. We would like to see UK consumers prioritise the high standards that we have here in the UK, and to see a new generation of young farmers access some of that current import market. At the moment, we spend £7.8 billion a year on importing horticultural produce that could otherwise be grown here in the UK. We would like to see an opportunity for new entrants to access that market and use that revenue to generate jobs and employment within the sector. We are certainly worried about the risk of importing fruit and veg from countries with lower environmental and social standards, which would undermine production in the UK.

Diana Holland: We see food standards and safe, healthy food as going hand in hand with decent treatment and professional, high-skilled jobs. All the evidence that we have is that recent food scandals have gone alongside severe labour abuses and exploitation, because workers are fearful of speaking out about what is going on. We very much believe that the Bill needs to cover the race to the bottom in all aspects and build in incentives to treat workers properly and ensure that decent standards are followed. That could be reflected in certain parts of the Bill.

--- Later in debate ---

[The Chair]

We are now joined by NFU Scotland, the Ulster Farmers Union, Quality Meat Scotland and the Scottish Government. We have until no later than 4.30 pm. Gentlemen, thank you for joining us. Would you identify yourselves for the sake of the record?

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

Alan Clarke: My name is Alan Clarke. I am chief executive of Quality Meat Scotland.

George Burgess: I am George Burgess. I am the deputy director in the Scottish Government responsible for trade policy, food and drink.

Ivor Ferguson: I am Ivor Ferguson, president of the Ulster Farmers Union.

Wesley Aston: I am Wesley Aston, chief executive of the Ulster Farmers Union.

[George Eustice]

Q The Bill sets out a clear plan for England, predominantly, and for how we design schemes. Schedule 3 deals with Wales, and schedule 4 sets out a plan for Northern Ireland. Mr Burgess, will you tell us what the plan is for Scotland?

George Burgess: Indeed. As I am sure the Minister is aware, the Scottish Government published earlier this year their proposals, “Stability and Simplicity”, for consultation. As the title suggests, those propose a period of stability and simplicity, with no significant changes in agricultural support for an initial period, followed by a period during which some relatively minor changes may be made. Those changes would be a matter for the Scottish Parliament to deliberate on in due course.

[George Eustice]

Q Just to be clear, we are at the stage in Committee of thinking about whether Scotland wants us to reserve an additional schedule to do some of that work or, as Northern Ireland has chosen to, not to change anything but to retain the current scheme for a period of time. Is it your position, though, that the Scottish Parliament will legislate and you do not want any inclusion in the Bill?

George Burgess: The choice between changing and retaining things through the Bill is perhaps not quite the right way to categorise it. Like DEFRA, we will use the withdrawal Act powers to repatriate into domestic law the existing European powers. As far as we are concerned, we have not identified anything in the agriculture space that needs anything beyond that in the initial phase to make existing schemes work. In due course, for the simplicity phase of our proposals, further powers would be required, but at this stage that is seen as a matter for the Scottish Parliament. Obviously, this is a devolved area. The whole thrust of devolution is that it will normally be for the Scottish Parliament to legislate in devolved areas.

[The Chair]

Does anybody else from Scotland wish to comment?

Jonnie Hall: We see an opportunity to have a schedule put in the Bill that covers the interests of Scotland in the longer term, beyond 2020. We see that as enabling Scottish Ministers, at some point in the future, to take clear decisions about how to develop and implement Scottish agricultural policy. Nevertheless, we also understand and appreciate some of the reservations the Scottish Government have about the process that that might lead us into.

From the Scottish farming perspective, the impasse between the Scottish Government and the UK Government over this is leading to a high degree of uncertainty and concern. At the moment, as Mr Burgess pointed out, the Scottish Government are very clear about what they want to do in the short term, but they have no clear plan or strategy for longer-term policy development. Although Wales, Northern Ireland and England have all set out their visions for the next five to seven years in that respect and consulted on those, that is lacking in the Scottish context at this moment in time.

[The Chair]

I have to be careful now not to invite disagreement from within the panel.

[George Eustice]

Q Is it the view of NFU Scotland, then, that ideally you would have a schedule similar to what Wales has or what Northern Ireland has?

Jonnie Hall: When the Bill was first published back in September—we knew this was going to come anyway—we were concerned that it was an enabling piece of legislation that could be a vehicle to allow Scottish Ministers to develop, implement and deliver a devolved agriculture policy for Scotland, but that the Scottish Government had not taken that opportunity. We understand that that opportunity remains. The offer is still on the table, if you like, for the Scottish Government to utilise this legislation.

The alternative would be that a Bill would go through the Scottish Parliament—a Scottish agriculture Bill—but that is, again, another unknown. It is a ticking clock, because as we all know, legislation of any sort takes time to go through any parliamentary process. As things stand, we have a degree of certainty for 2019-20, but thereafter, into 2020-21, we have no absolute certainty. Farming is a game that relies on a degree of confidence and certainty.

[George Eustice]

Q Obviously, we are at the Committee stage of the Bill, and the purpose of this session is to consider what, if any, amendments we should make. It would be quite a substantive amendment to add a whole new schedule to cover Scotland, but that offer remains open. I suppose, however, that it is open only for a period of time before the Bill moves on and we pass that point. Perhaps this is a question for Mr Burgess again, but is there a timescale in which you would definitely make the decision about whether you wanted to retain the option to use a schedule, or have you already passed that point and resolved to draft your own legislation?

George Burgess: I go back to the answer that I gave earlier. I am not sure that I recognise Mr Hall’s characterisation of the ticking clock on this. Assuming that our work with DEFRA proceeds, the powers will pass to the Scottish Ministers to implement the existing package of support. There will be no issue of agricultural support not being able to be paid. I do not personally recognise the 2020-21 deadline that has been suggested.

That gives time for any necessary legislation to be developed and taken through the Scottish Parliament. As a devolved matter, we see it as principally for the Scottish Parliament to do that. I am sure that our Welsh and Northern Irish colleagues have very good reasons for taking up DEFRA’s offer of including schedules in the Bill, which necessarily largely bypasses the legislative processes in those countries.

Jonnie Hall: May I come back on that? The clear thing is that, in terms of continuity, the Scottish Government could continue to utilise the existing common agricultural policy mechanisms and all that goes with that, but the UK Government and the other devolved Administrations are setting out an opportunity to move away from the CAP and to put in place a new policy that is more befitting and more bespoke to the needs of British and Scottish agricultural interests, so we can move away from the blunt approach of area-based payments and move on to more focused, targeted payments that underpin productivity in the environment and so on. Our concern is that, yes, things would continue as they are today, but there would be no ability to move away from the CAP, and that is what we all look at as the opportunity here.

[George Eustice]

Q Mr Aston, in the absence of an Administration in Northern Ireland, the Department of Agriculture, Environment and Rural Affairs took the view that it wanted a slimmed-down or abridged version of the powers, but that it definitely wanted the power to be able to strip out some of the bureaucracy and remove some of the unnecessary burdens in the current single farm payment scheme. Are you content with the approach that it has adopted? Does it do all the things you would like?

Wesley Aston: May I pass that across to my president, Mr Ferguson?

Ivor Ferguson: Certainly, we are quite happy with the approach that DAERA has taken. Of course, as the Ulster Farmers Union, we had a fair opportunity to feed into the framework document that is out for consultation. The other reason why we welcome the Agriculture Bill is that it gives us the ability to regionalise what we are doing in Northern Ireland. Another important point is that it gives us the opportunity for civil servants to take decisions in the absence of an Assembly.

[The Chair]

Q I am sorry, Mr Ferguson, but some of us are of a certain age. Could you speak up a bit?

Ivor Ferguson: Okay. Apart from being happy with the framework document, which we have had an opportunity to feed in to as the Ulster Farmers Union with DAERA in Northern Ireland, we are quite happy that we have the ability to regionalise what we are doing in Northern Ireland. We are also happy that the civil servants will be able to make decisions in the absence of an Assembly. We are quite happy with all those things.

[George Eustice]

Q What would your priorities be to de-bureaucratise the current scheme, the single farm payment scheme, which under the powers you have, you would be able to do from 2021?

Ivor Ferguson: The first thing I wanted to say is that we would not want to move away entirely from the current CAP scheme that we farm under. We would like the opportunity to have some area payments at a lower level. It would certainly take the volatility out of our farming system. Farming in Northern Ireland is somewhat different from farming on the mainland, because we have so many small family farms, and if we took the area payments away completely, that would have a devastating effect moving forward. We certainly have an opportunity to take some of the bureaucracy out of the scheme, and that is something that we would look forward to. That is what we have tried to address in this new framework document. We have just had this consultation period, and I think we have addressed that to a large extent.

[The Chair]

Q Mr Aston, you courteously deferred to your president. Is there anything you would like to add?

Wesley Aston: As far as we are concerned, the key issue in relation to this specific question is the ability to take our own decisions at a local level, and given the absence of the Northern Ireland Executive at the present time, we felt it was important to include that legislative power within the Bill. Going forward, as our colleagues from NFU Scotland have already said, there has to be scope within an overarching UK framework for the regions to tailor, within limits, the support to their individual circumstances—as we do under the CAP at the minute. That is critical going forward, and it is an opportunity for us all to try to address the three broad pillars of where we see support being essential.

From our point of view, that means sustainability and competitiveness, and particularly the whole issue of resilience. That goes back to my president’s point about having some sort of area-type payment as a resilience measure, but equally, the issue of the environment and how we take that forward. The Bill gives us more scope to do that, and we welcome the opportunity that it provides.

--- Later in debate ---

[Chris Davies]

Q I represent a constituency right on the border of England and Wales, and many of my farmers have land on both sides of the border. Currently, they have to abide by what one could say are two slightly different regimes. Mr Hall, regarding the farmers that you represent on the Scottish side of the border that also have land in England, so that they farm both sides, do you think the Scottish Government’s approach to this Bill has given them extra concern and worry?

Jonnie Hall: We do have members who farm in different parts of the United Kingdom under the same business and it has always been something of a challenge in terms of which Administration deals with which component—whether it is land inspections, the payment claims and so on. I suspect that the lack of a publicly clear strategy from the Scottish Government poses some doubt and questions in the minds of those farmers who straddle borders, but equally it probably poses a lot of uncertainty for any farmer in Scotland, not just those who straddle the border.

One thing that will be vital—it goes back to common regulation—is that when you have cross-border farmers, you have to apply the same regulatory approach in terms of pesticide use, animal traceability issues, food hygiene, feed rules and all the rest of it across the United Kingdom in a uniform fashion. That goes back to the statement that all farming unions have always agreed: we need a commonly agreed regulatory framework. We are playing to the same rulebook, but we are not necessarily supporting farmers in the same way; the support requirements for a hill farmer in Argyll are different from those of someone growing fruit and veg in Lincolnshire.

[George Eustice]

Q I want to come back to part 7 and the WTO clause, which I know you are concerned about—I think unnecessarily so, for reasons I will explain. Mr Burgess, who is currently responsible for ensuring that we abide by WTO rules and obligations, and who is responsible for reporting to the WTO to demonstrate that?

George Burgess: In terms of observing and implementing those regulations, it is all of the Administrations within the United Kingdom. That is a well-established legal fact. The Scottish Government understand that, within their areas of responsibility, they must ensure that their actions are compliant. In terms of reporting into the international field, there are mechanisms through the European Union and the Commission. Such obligations are common in many international mechanisms, some of which the United Kingdom is a signatory to, and it is well established that, where necessary, the devolved Administrations provide information, often through a central contact point within the United Kingdom Government, as part of our international obligations.

[George Eustice]

Q The reality is that the UK co-ordinating body, which marshals the various paying agencies in the UK, is responsible for marshalling the data to the EU. The EU then reports to the WTO. The simple reason for that is that the EU holds the WTO schedule on aggregate measurement of support. So the EU holds the schedule and does the reporting, and it requires that we report to it the information that enables it to demonstrate compliance. When we leave the EU, there will be a UK schedule and a UK AMS. All that clause 26 does is make provision for the Secretary of State to do what the EU currently does: to report and demonstrate compliance.

George Burgess: I think that is quite a narrow reading of clause 26, because only one of the subsections deals with that information provision and reporting. As has been already noted, we have considerable concerns about the other provisions in the clause. As I have said, we have nearly 20 years of experience of the devolved Administrations providing the necessary information to the United Kingdom Government for onward routing—whether through the European Commission or direct to the necessary international body—across a range of international obligations. There is absolutely no reason why we would stop providing that information now.

[George Eustice]

Q But you understand that the EU has a single AMS allocation, and through that it must facilitate schemes in 28 member states. Therefore, the EU can limit the amount of market-distorting support payments that any member state makes. If France were to bust the bank, as it were, and single-handedly try to spend all of that, the EU would forbid that from happening—it has powers to ensure that it complies with the schedule. While it is devolved, do you not accept that the UK Government, which will hold the schedule responsible for ensuring that we stay in our AMS envelope, have to be able to set some parameters, otherwise there is no way of being able to deliver that compliance?

George Burgess: My understanding is that it is the UK schedule, not the UK Government schedule. That there need to be mechanisms in the United Kingdom for co-operative working on this, to ensure that we meet our international obligations, is not at all in question. We have been working with DEFRA since the turn of the year on what a framework in this area should look like. It was therefore a bit of a surprise to us to be presented with a clause that puts all the power into the hands of the Secretary of State, acting alone.

We are looking for greater involvement for all the devolved Administrations in the setting of the limits, so that we can ensure and demonstrate to all parts of the United Kingdom that there is fairness all round in the way the international limit is being allocated.

[George Eustice]

Q Subsection 2(b) states that we can establish

“a process for the resolution of disputes between the appropriate authorities”.

There is a dispute resolution process in an instance where Scotland might say, “We want to spend even more on market-distorting support and we think it is unfair that you have constrained us from doing that.” There is a dispute resolution process.

George Burgess: That there should be a dispute resolution process we have no difficulty with. If we read further in that provision we will see that it says that the dispute resolution process

“may include provision making the Secretary of State the final arbiter on any decision on classification.”

That particular provision, which sounds a little “judge and jury” to us, does not feel like the best way forward.

[The Chair]

I do not think we will reach a conclusion on that this afternoon.

--- Later in debate ---

[Colin Clark]

Q Do you perceive a risk of divergence? Is that not fundamentally the point, whether it is on the frameworks or on the producer organisations?

George Burgess: If we look at the producer organisation provisions that we have here, and at the amendments that we have proposed, none of them would create that risk any more than it exists at the moment.

Jonnie Hall: I agree with Mr Burgess.

[George Eustice]

Q Mr Clarke, the Government are under pressure from the other Mr Clark around the table, my hon. Friend the Member for Gordon, and from my hon. Friend the Member for Brecon and Radnorshire, to give consideration to an amendment that would enable some transfers of levy payments between levy bodies, but only with the agreement of the relevant Governments or of the Secretary of State and the Scottish and Welsh Ministers. It is a bit problematic in the absence of a legislative consent motion, because it would explicitly affect something that Scottish Ministers could do. If that amendment were to get some support, should the Scottish Government bank that advantage and grant the LCM on the Bill?

Alan Clarke: I made the point earlier, when I was asked whether there was a particular vehicle that could be used, that I thought the amendment was a really good vehicle, because it is timely and it is opportune. The reality is that we need a solution.

We have shown that the three organisations can work really well together, but we are not maximising our potential. If we can get the full £1.5 million back to Scotland, and the same value back to Wales, using a mechanism that the three organisations would agree, we will have a real opportunity. If that amendment were made to the Bill, and a process was put in place to make it happen, that could happen very quickly. That would be a real benefit, particularly to us in Scotland, and to Wales. We can show evidence of what we have done working together over the last 18 months, and, as I said earlier, we would continue to do that.

George Burgess: The Scottish Government have been seeking an amendment to deal with the red meat levy issue, as Mr Clarke said earlier, and have been asking for the Agriculture Bill to be used for that. I prepared a detailed policy paper on the subject more than a year ago and I have been discussing it with DEFRA officials since.

We do not yet have a commitment from the United Kingdom Government to use the Bill as a vehicle to deal with the red meat levy, but we hope that that commitment will be forthcoming. I have heard that two amendments deal with the subject, and we will look at those with great interest. It is certainly something that the Scottish Government have been seeking.

Jonnie Hall: May I add the weight of NFU Scotland to that, to support the Scottish Government and Quality Meat Scotland? The Bill is a clear opportunity to resolve an issue that has been ongoing for several years. We have waited for the right legislative vehicle. This is a clear moment to get the right amendment in the Bill and make it happen.

[Deidre Brock]

Q I have a question about Northern Ireland for Mr Ferguson and Mr Aston. There is a geographical conundrum in your market, given that some production chains straddle what may be a UK border with the EU. What kind of support are farmers in Northern Ireland likely to require after Brexit? What impact might the different possible outcomes have?

Ivor Ferguson: The level of support we need in Northern Ireland will largely depend on our trade deals. That will be a big deciding factor. If the trade deals are against us in some way, we will certainly need more support. A lot of the support will depend on that. The difference in livestock between north and south does not really come into it. In Northern Ireland, we produce under the Red Tractor quality assurance scheme. As I said, we supply more than 80% of our product to the UK mainland market. That is not complicated by southern Irish livestock, because the standard is not the same as in Northern Ireland. I am not saying the standard is any lower than ours, but the Bord Bia standard is completely different from Red Tractor assurance.