Public Bodies and VAT

Debate between George Eustice and Daniel Zeichner

Wednesday 17th May 2023 Westminster Hall

[George Eustice (Camborne and Redruth) (Con)]

I beg to move,

That this House has considered public bodies and VAT.

It is a pleasure to serve under your chairmanship, Mr Betts. Hon. Members will be well aware that His Majesty’s Treasury tends jealously to guard its primacy on tax matters. Indeed, I remember as a Minister frequently being given a briefing inviting me to respond to questions about tax with the simple words, “This is a Treasury matter.” If I ever sent officials to the Treasury to raise an idea or discuss a particular matter, they would go away with a look of trepidation in their eyes and come back looking rather chastened. However, I never accepted that tax is a matter for the Treasury alone. I have always believed that it is a matter for the Government as a whole because tax affects every industry, every public body and every Department. Its effect on all those things means there is also a vital role for Parliament in scrutinising tax policy.

I want to focus on the Value Added Tax Act 1994 and the way we treat public bodies—especially the unfair treatment of further education colleges. The United Kingdom was forced to introduce VAT when we joined the European Economic Community in 1973, and over the years VAT became one of the big three tools used by Government to raise revenue. It has also been the main go-to tool for Governments when they are trying to deal with a crisis. VAT was slashed after the financial crisis of 2008, and again during the covid pandemic.

Under the VAT rules, tax can be levied on goods at either the standard rate—the full 20% tax is levied on sales—or at a reduced rate of 5% for certain items, such as children’s car seats. There are also zero-rated goods—principally food and children’s clothing. Finally, there is another category—exempt goods. That applies to many services, including insurance, finance and, notably, education.

The 1994 Act established a basis for public bodies to reclaim the VAT on their purchases, even though their services were exempt. That applies in particular to councils, the police, schools or academies and, notably, museums. However, there is an anomaly in the way the tax system works, in that FE colleges are not on the section 33 list that would make them exempt.

[Daniel Zeichner (Cambridge) (Lab)]

The right hon. Gentleman is making an important and useful speech. Does he agree that the VAT trap has sometimes been used as a way to lure institutions out of the maintained sector and into academisation and that that is another lever that the Government have used the VAT system to create? That has affected institutions such as Hills Road Sixth Form College, Long Road Sixth Form College and Cambridge Regional College.

Oral Answers to Questions

Debate between George Eustice and Daniel Zeichner

Thursday 17th June 2021 Commons Chamber

[George Eustice]

The Secretary of State for International Trade will, I think, be giving a statement later. The Government have now published the key components of the agreement in principle, and some analysis of the impacts of this agreement has already been cited. Australia is a very important partner of ours, and it is important that we get a trade agreement with it. It is, of course, a smaller economy and the opportunities are therefore not as large as they would be with a larger economy, but nevertheless, Australia is an important ally and this is a good agreement between us.

[Daniel Zeichner (Cambridge) (Lab)]

I hardly need to explain to the Secretary of State the level of disbelief and anger that there is as the betrayal of British farming unfolds this week. The level of detail is unclear, but The Daily Telegraph helpfully reports a major win for the Secretary of State for International Trade—doubtless briefed by her. The key losers in this situation are British farmers. Given that we now know that there is going to be a huge increase in the amount of beef and lamb coming in from Australia—produced to lower standards at lower cost, disadvantaging our farmers—will the Secretary of State tell the House what he is going to do to help our farmers meet that challenge?

[George Eustice]

We secured some important mitigations to help the farming industry, including the fact that a tariff rate quota will stay in place for the first 10 years on both beef and sheep, and for the subsequent five years there will be a special agricultural safeguard that means that if volumes go above a certain trigger, tariffs immediately snap back in. We have put in place mitigations through the quota for the first 10 years and through that safeguard.

Oral Answers to Questions

Debate between George Eustice and Daniel Zeichner

Thursday 21st January 2021 Commons Chamber

[George Eustice]

Yesterday, we announced that we would offer one-to-one support for individual enterprises in the fishing sector that are struggling to get used to the new paperwork; that could be from HMRC or the Animal and Plant Health Agency. In addition, we work very closely with customs officials and Border Force officials in France to help improve the understanding at that level. We also announced a £23 million fund yesterday to help those fishing businesses that have struggled in these initial weeks.

[Daniel Zeichner (Cambridge) (Lab) [V]]

I fear the Secretary of State is living in a parallel universe. He must have seen the headlines: “Pig Heads Are Rotting In Rotterdam As Brexit Delays Hit The British Meat Industry”. Nick Allen of the British Meat Processors Association understands that these problems are not teething problems; they are structural. He warns that the meat industry’s trade with the EU is in jeopardy. Is he right about that? What is the Secretary of State going to do about it—just suggest that farmers do something else?

[George Eustice]

The hon. Gentleman is wrong about that. Actually, goods are flowing, particularly lamb, which is our principal meat export. Dairy goods are also flowing. Yes, there are occasionally delays at the border, as border officials in France and the Netherlands get used to the new processes, but we are intervening in all such instances to help the businesses concerned.

Oral Answers to Questions

Debate between George Eustice and Daniel Zeichner

Thursday 26th November 2020 Commons Chamber

[Daniel Zeichner (Cambridge) (Lab)]

May I associate those on this side of the House with the Secretary of State’s comments on the appalling loss of the Joanna C?

Twenty-six per cent. of our food comes from the European Union, and it is reported that last week the Department for Environment, Food and Rural Affairs’ head of food security warned industry reps to expect just 40% flow rates. I am sure the Secretary of State will want to provide reassurance on that, but as we have already heard, his attempts to placate livestock farmers recently led to some pretty dreadful headlines in the farming press. “Laughable” was the comment from the Farmers Guardian. So can he do better today and explain the plans he has in place to keep our food supplies flowing in just 35 days’ time?

[George Eustice]

We have worked with industry to ensure that the capacity is in place to issue export health certificates, and we have been contacting meat processors, fish processors and others in the sector to ensure that they are prepared for the new administration that will be required, and of course we continue to work on plans to ensure that goods flow at the border.

Oral Answers to Questions

Debate between George Eustice and Daniel Zeichner

Thursday 15th October 2020 Commons Chamber

[George Eustice]

The hon. Gentleman paints an accurate picture of the environmental degradation that has taken place, particularly in the past 50 years or so. As we think about the future, it is not enough just to protect particular sites; we need to build back nature in some of these areas. We will be doing that through our new environmental land management policy to replace the common agricultural policy, creating new habitats and creating space for nature. We will also be delivering this through the new approach and governance framework outlined in our Environment Bill.

[Daniel Zeichner (Cambridge) (Lab)]

Our familiar countryside is as it is today because of protection and management, but, as we have heard, the Environment Bill that is needed to maintain that protection has gone missing, and financial support for farmers, who of course do so much to manage our countryside, is just weeks away from major upheaval. The Secretary of State talks about sustainable farming initiatives without bringing any detail to this House, and that is a worry for everybody. Come 1 January, will farmers have the financial information they need to make informed decisions, and will the promised Office for Environmental Protection actually be in place and operating properly?

[George Eustice]

The Environment Bill will be resuming its passage in Committee shortly. The hon. Gentleman will be aware, for instance, that the Government have recently been consulting on our new approach to introduce due diligence in the supply chain to prevent deforestation. There are good reasons why the Bill has been paused while that consultation is considered. In answer to his question, yes, farmers will have all the information they need by next year, and we will begin the transition to the new policy next year.

Oral Answers to Questions

Debate between George Eustice and Daniel Zeichner

Tuesday 19th May 2020 Commons Chamber

[George Eustice]

I can reassure my hon. Friend that all essential workers, including all those involved in the food supply chain, are eligible for testing. We are working with the food sector to ensure that employees who are either self-isolating with symptoms of the coronavirus or who have a symptomatic household member are able to access those tests. Eligible workers who are self-isolating can apply for a test directly online or can be referred for a test by their employer.

[Daniel Zeichner (Cambridge) (Lab)]

The resilience of the food supply chains has been impressive, and we thank all those who work on our farms and in processing factories and the pickers, delivery drivers and, of course, shop workers who have kept the food flowing to our supermarkets. The foolish dismantling of the seasonal agricultural workers scheme, now made worse by the covid crisis, means that we face an alarming shortfall in the 70,000 experienced people needed to pick our crops. The laudable “Pick for Britain” campaign may help, but it was reported only a few weeks ago that of the 50,000 applicants, only 112 had made it into the field. Can the Secretary of State tell us what those figures are today and what is his plan B?

[George Eustice]

We estimate that only about a third of the east European workforce who would usually come to work on our farms are here or have continued to come. That means that we will need a British workforce to step up and assist in getting the harvest in this year, and we are very encouraged by the results so far. The hon. Gentleman is right that a few weeks ago, when it was early in the season, there were not many jobs. But we are now approaching the peak season in June, and employers are starting to recruit more and more British workers. For instance, G’s salads currently has more than 400 British people working on its farms today

Oral Answers to Questions

Debate between George Eustice and Daniel Zeichner

Thursday 19th March 2020 Commons Chamber

[George Eustice]

My right hon. Friend makes a very important point. He will be aware that our manifesto and our published objectives for the US trade deal make it clear that we will protect our food standards and animal welfare in any future trade deals. I am aware that there has been a proposal for a trade and standards commission, which we are considering, and we are in discussion with other Departments, such as the Department for International Trade, about how best to ensure that agricultural expertise is fully reflected as part of the negotiating team.

[Daniel Zeichner (Cambridge) (Lab)]

If the motto in past crises was “Dig for Victory”, so far this one has been much more “Distribute for Victory”. Of course, the retail sector is very important, but I am less sanguine than the Secretary of State about future food supply and I think that we need to make sure that we support all those in that chain. The poultry industry, for instance, is very time-dependent. Two or three days extra for chickens on farms can lead to a whole range of welfare and logistical issues. Can I take it that the Secretary of State is pressing his colleagues to ensure that all those in the food supply chain are recognised on the Government list of key groups of workers, so we make sure that we secure our future food security?

[George Eustice]

As I said in response to an earlier question, the Government recognise that a significant number of staff working throughout the supply chain, both retailers and food processors, have children of school age; we estimate that the figure is between 25% and 33%. We therefore recognise that many of them will need to be defined as key workers, but further information on that will be published by the Government later today.

Agriculture Bill (Third sitting)

Debate between George Eustice and Daniel Zeichner

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

[George Eustice]

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

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

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

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

[Daniel Zeichner (Cambridge) (Lab)]

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

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

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

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

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

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

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[George Eustice]

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

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

[Daniel Zeichner]

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

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

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

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[George Eustice]

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

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

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

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

[Daniel Zeichner]

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

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

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

[Daniel Zeichner]

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

[George Eustice]

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

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

Agriculture Bill (Fourth sitting)

Debate between George Eustice and Daniel Zeichner

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

[George Eustice]

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

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

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

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

[Daniel Zeichner (Cambridge) (Lab)]

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

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

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

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

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[George Eustice]

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

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

[Daniel Zeichner]

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

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

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

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

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

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

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

Agriculture Bill (First sitting)

Debate between George Eustice and Daniel Zeichner

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

[George Eustice]

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

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

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

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

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

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

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

[Daniel Zeichner (Cambridge) (Lab)]

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

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

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

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

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

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

--- Later in debate ---

[George Eustice]

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

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

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

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

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

[Daniel Zeichner]

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

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

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

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

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

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

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

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

Agriculture Bill (Second sitting)

Debate between George Eustice and Daniel Zeichner

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

[George Eustice]

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

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

[Daniel Zeichner (Cambridge) (Lab)]

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

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

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[George Eustice]

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

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

[Daniel Zeichner]

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

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

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

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[George Eustice]

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

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

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

[Daniel Zeichner]

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

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

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

--- Later in debate ---

[George Eustice]

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

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

[Daniel Zeichner]

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

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

--- Later in debate ---

[George Eustice]

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

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

[Daniel Zeichner]

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

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

--- Later in debate ---

[George Eustice]

Yes, in the new scheme.

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

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

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

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

[Daniel Zeichner]

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

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

--- Later in debate ---

[George Eustice]

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

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

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

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

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

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

[Daniel Zeichner]

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

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

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

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

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

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

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

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

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

Oral Answers to Questions

Debate between George Eustice and Daniel Zeichner

Thursday 12th July 2018 Commons Chamber

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

My hon. Friend raises a very important point. Earlier this year, we invited calls to a small grants scheme to promote farm productivity. It was over-subscribed, so we have put in an additional £7 million, making a total of £23 million. We intend to have additional calls later this year.

[Daniel Zeichner (Cambridge) (Lab)]

Yesterday, senior industry leaders were in Westminster as part of the Prince of Wales’s corporate leaders group, which is facilitated by the Cambridge-based Cambridge Institute for Sustainability Leadership. Industry will be key in tackling the environmental challenges of the future, but when will the Government acknowledge that far from being a burden, intelligent regulation is the key to environmental innovation?