Oral Answers to Questions

Debate between George Eustice and David Drew

Thursday 31st October 2019 Commons Chamber

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

Mr Speaker, our careers have been somewhat in parallel. I had a slight interregnum in the middle of your speakership, but I am pleased to be here today, to top and tail it. We have remained good friends throughout.

The Government committed to keeping the current level of farm spending until the end of this Parliament, which will be in the next couple of days. The Labour party will commit to keep that level of spending and, indeed, even spending more under the new system, which will be expensive to introduce. Will the Government make that commitment?

[George Eustice]

The hon. Gentleman is right; the Government are committed to keep spending exactly the same until the end of this Parliament. He will have to wait to see our manifesto to find out what will happen in the next Parliament, but I will simply say this. It is implicit in the Agriculture Bill that there will be a transition over a period of seven years, during which we will roll out the new policy, and we have already committed to fund the objectives of the Agriculture Bill.

Common Organisation of the Markets in Agricultural Products (Producer organisations and Wine) (Amendment Etc.) (EU Exit) Regulations 2019

Debate between George Eustice and David Drew

Monday 28th October 2019 General Committees

[George Eustice]

I start by answering this question of where the draft regulations fit within the wide panoply—as the hon. Member for Stroud described it—of CMO regulations. The CMO is a highly complex body of law, as he and any of us in such Committees have discovered. It is a big jigsaw, but I assure him that it all fits together neatly, once we bring together all the different SIs.

For a number of reasons, we have had to do the SIs in different stages: sometimes because certain matters are reserved and others devolved, so at times two SIs must cover broadly similar areas; in other instances because different provisions within the CMO have not all been dealt with at the same time; and sometimes there have been time issues, when certain matters have been unresolved or still subject to discussion and so left until later in the process. The reason we are discussing this again, although we have discussed the CMO many times, is that these regulations fall into that last category.

There was discussion with the devolved Administrations earlier this year on exactly which matters were reserved and which devolved. These are the matters we have decided and agreed are reserved, which is why we made this instrument[Official Report, 30 October 2019, Vol. 667, c. 2MC.]. Later today, a separate SI will deal with some of the devolved issues in a similar space—

[Dr Drew]

I’ll be there.

[George Eustice]

The hon. Gentleman, who was corrected by my right hon. Friend the Member for Scarborough and Whitby, made an important point about the export of English wine, as well as Welsh and other such wines. They are increasingly successful overseas, and the growing export market for English sparkling wine in particular has been a big success story. However, as I said in my opening remarks, organic certification recognition and other regimes are one of a number of areas where the European Union is maintaining the position that it will not discuss such matters until after we have left on 1 November. Inevitably, therefore, in the short term there would be an air gap in such areas, but all of them—including ensuring that we expedite the recognition of certification documents for English wine entering the EU market—are on a list of priorities that we will seek to progress as quickly as possible.

The shadow Minister raised the issue of page 13, annex 8, which is simply about the anti-avoidance criteria. Those are in a fairly generic form that has been used previously. He also mentioned page 16 and, on reading that page, the document seems to me to be largely about interpretation of EU documents. However, to answer his direct question, in all these SIs we are moving functions currently exercised by the European Commission to be exercised instead by—since these are all reserved areas—the Secretary of State.

I hope that I have managed to address some of the particular issues raised by the shadow Minister—

[Dr Drew]

I accept what the Minister has said. Clearly this is a specialist area, but no specialist wine producers were included in the consultation. Will he assure me that he has talked to the industry about the impact of some of the changes? I dare say that will include retailers, who will presumably be interested to know how they will get their French, Spanish and Italian wines.

[George Eustice]

I can assure the hon. Gentleman that we have had extensive discussions with the UK hospitality industry and its trade body—which we meet weekly—and more widely with agrifood stakeholder groups, which we have also met. As we progressed our plans for a potential no-deal Brexit, they have been fully engaged. At one point, they had been concerned that we might not have a transitional period of nine months. We gave some consideration to whether we should, in the first instance, offer that unilaterally to the European Union or whether we should seek mutual reciprocation.

In the event, in this and virtually every other area, the Government took the view that we should adopt a continuity approach for at least six months. In this instance—I know the hon. Gentleman asks about this a lot—we felt that a nine-month transition was consistent with what we said about giving six months of continuity, when not much would change at all, while recognising that bottles need to be labelled in a particular way. To give people the extra time, we chose to go for nine months in this particular instance.

I assure the hon. Gentleman that we have consulted widely with the industry, which is reassured that we are offering this grace period on wine. On that basis, I hope the Committee will support this statutory instrument.

Common Agricultural Policy (Market Measures, Notifications and Direct Payments) (Miscellaneous Amendments) (EU Exit) Regulations 2019

Debate between George Eustice and David Drew

Monday 28th October 2019 General Committees

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

I am delighted to serve under your chairmanship, Mr Bailey, and delighted that yet again we are talking about CMOs—only for the second time tonight. We did have a break in the Committee in between.

I am intrigued why the same explanatory memorandum has been used for these regulations and for those that we considered earlier, the Common Organisation of the Markets in Agricultural Products (Producer Organisations and Wine) (Amendment etc.) (EU Exit) Regulations 2019. Given that the memorandum is the same, I do not understand why we could not have conflated the two statutory instruments. I know that they relate to different market sectors, but unless I am wrong, the present instrument refers to wine as well as other sectors, although it is more all-embracing. I meant to ask that question in our earlier debate, but it slipped my mind.

The point that I really want to raise is about the mechanism for charging. Paragraph 3.3 of the explanatory memorandum states:

“Defra has decided not to issue this instrument free of charge to all known recipients of SI 2019/828 as, given the nature of the correcting provisions in this instrument and the proportion that they represent of the whole instrument, it would be disproportionate to apply the free issue procedure to SI 2019/828.”

If it is not being offered free, what is the charging mechanism and who is paying? Presumably we are talking about producer organisations, as in the previous SI, but it would be interesting to know a little more about what the mechanism involves. Will it be fundamentally different if we leave the EU, or will it be a similar funding arrangement?

We are back to our old friend the common organisation of the markets. Will the Minister say more about direct payments, which are in the title of the regulations? What exactly will be, or could be, owed to farmers if and when we leave the EU? Presumably the money will come out of pillar 1, but what will happen to those who are owed money under pillar 2? Will they be subject to a different statutory instrument or a completely different regime? It would be useful to know exactly what the procedures are for compensating those farmers, owners or producers with what they will be owed if we change the status of the arrangements that they are subject to.

Finally, the explanatory memorandum gives the usual list of consultees—we get used to reading the same thing in explanatory memorandums, because they look very similar. The statutory instrument is pretty all-embracing. It applies to the devolved Administrations, does it not?

[George Eustice]

indicated assent.

[Dr Drew]

It would be interesting to know what specific consultations have taken place with Scotland and Wales, or even with Northern Ireland, given that there is no one to consult with, as we know from our debate on the Agriculture, Environment and Rural Affairs (Amendment) (Northern Ireland) (EU Exit) (No. 2) Regulations 2019. That is why those regulations were made: because the UK Government have had to take on the responsibility of the Northern Ireland Assembly and Executive, which are not in existence at the moment.

I have no specific or overall concerns about the regulations, so the Minister will be pleased to hear that we will not vote against them. However, no doubt it would be of public interest to get some clarity on what is being paid to whom, and to ensure that nobody loses out—particularly as the regulations imply that people will be making contributions towards their involvement as producer organisations.

[George Eustice]

I hope that I can deal with the shadow Minister’s concerns. Paragraph 3.3 of the explanatory memorandum relates to the free issue of hard copies of the instrument. The reason for our approach is that the regulations do not make policy changes; as we have discussed many times, they simply make minor changes to make existing policy operable. We will not be giving out free hard copies of the SI, but obviously it is available to anybody who wants to see it.

Why do we have one explanatory memorandum but two statutory instruments? The regulations that we considered earlier relate exclusively to reserved matters, whereas the present regulations are about devolved matters, so we needed two statutory instruments. However, they both address generally the same topic, so we chose to cover them in a single explanatory memorandum.

The shadow Minister asked how the direct payments process works. As always with the CAP, some of the matters involved are complicated. The financial discipline mechanism, as it is called in EU terminology, applies only to pillar 1. Under that mechanism, each year the European Union top-slices the pillar 1 budget, which normally goes out in the basic payment scheme. It typically takes about 1.5% of the budget and holds it in the crisis reserve; should there be a major market disruption in dairy or something else during the year, that top-sliced crisis reserve will fund interventions in the market such as buying up skimmed milk powder.

Under the SI, the money top-sliced in the last scheme year will be reimbursed to farmers the next year if it is unused. If there is no crisis against which the money needs to be used, it goes back into the pot for the following year. That is how the EU system works; we are simply putting it beyond doubt that if there is unused money in the crisis reserve, we will add it as a top-up to next year’s BPS payment, even though we will be outside the European Union.

Finally, the shadow Minister asked whether the devolved Administrations had been involved. I can confirm that they absolutely have. The regulations relate to matters of devolved competence. We have had discussions with the Administrations; although we are legislating UK-wide, it is with their consent.

I hope that I have been able to address the shadow Minister’s points. I welcome the fact that he does not intend to press the regulations to a vote.

[Dr Drew]

I wonder how many more CMO SIs we will have.

Question put and agreed to.

TB in Cattle and Badgers

Debate between George Eustice and David Drew

Wednesday 23rd October 2019 Westminster Hall

[George Eustice]

We will look at that evidence, but this is a difficult issue. My right hon. Friend is right that our aim, as my right hon. Friend the Member for Scarborough and Whitby pointed out, is to get the badger population down by 70% in the four years of the cull; it is not our intention at all to eradicate the badger population. This is an issue that we will continue to look at because, as we plot how to get from where we are now to being officially TB-free by 2038, it is clearly an important issue.

My right hon. Friend the Member for Scarborough and Whitby also pointed out some of the challenges of vaccinating badgers and the further challenge that we have had with an oral vaccination. However, if we can use such a vaccination, there are also some advantages. It provides herd immunity and there is some evidence that cubs born in badger populations that have been vaccinated have a higher degree of resistance to the disease than other badgers.

Finally, the hon. Member for Edinburgh North and Leith asked about Scotland. The approach taken in Scotland is very similar to the approach that we take in a low-risk area elsewhere. Scotland does not have a large badger population and nor does it have a presence of the disease in the badger population, which is in common with the north of England. Therefore, the nature of the challenge in Scotland is very different from that elsewhere.

The badger population has more than doubled in this country over the last 20 or so years. In the cull areas, which we are targeting because the disease is rife there, we simply look to reduce the badger population by 70% for the duration of the cull.

[Dr Drew]

The one thing that has not been mentioned—I should have mentioned it myself, of course—is cattle vaccination. Such vaccination was always 10 years away, but I gather that it is now five years away. Are the Weybridge and Pirbright research institutions still working on this vaccination and, if so, can they clarify where they are with that work?

[George Eustice]

Yes, we are continuing to do cattle vaccinations; that particular research has not been stopped. As the hon. Gentleman says, cattle vaccination is an important line of work and it is one that we intend to continue.

Exiting the European Union (Agriculture)

Debate between George Eustice and David Drew

Tuesday 1st October 2019 Commons Chamber

[George Eustice]

We rehearsed plenty of issues when we debated the previous statutory instrument, so I can be briefer, and I appreciate that both hon. Members who spoke have done so briefly.

The hon. Member for Stroud (Dr Drew), the Labour shadow Minister, asked who would do this work. The office for environmental protection, which will obviously be a matter for the new environmental Bill, would not do any such work. We are talking here, probably, about marketing standards and labelling standards, and the Rural Payments Agency has an inspectorate that leads on that work; it always has done, and has done so incredibly well.

The hon. Gentleman should recognise that the European Union does not have a directly employed army of inspectors in UK ports; the EU has a body of law, but UK agencies already do all such work. As he said, not only does the RPA monitor marketing standards, but there are other organisations as well. We have organisations that monitor pesticide residues; we have the FSA, which deals with food safety issues; we have organisations such as the Food and Environment Research Agency, which deals with plant health, and the Animal and Plant Health Agency, which deals with animal health. The technical expertise is already here in the UK, in our agencies; indeed, that technical expertise is often relied upon by the EU, not the other way round.

[Dr Drew]

I accept that; many of our good people currently work for the EU. But is the Minister seriously suggesting that those people have carried out proper contingency planning on how they will do this monitoring in a month’s time? How would FERA—how would the RPA, which I have significant doubts about; I do not know how many scientists it actually employs—sit down and do the work to see whether what has been imported is what it says on the label?

[George Eustice]

The regulations provide for a transitional period, precisely to give people time to adjust. We will be saying to European wine exporters that they do not, on day one, have to apply for a UK certificate, or get UK certification. We are saying, very generously—it is not being reciprocated particularly yet—to the European Union that because we want to prioritise continuity in the short term while people adjust to this new situation, we will recognise their existing certification.

To answer the hon. Gentleman’s question, there are no risks and nothing new is going to happen that has not already been happening under EU law for a number of years. This simply creates that transitional space to avoid UK authorities having to do unnecessary administration in the short term, and to avoid exporters having to go through unnecessary administration in order to continue to trade.

[Dr Drew]

The Minister is being very generous in giving way. What then is to stop people labelling their cheap plonk as burgundy and sending it in the form in which they send their good stuff? How will we be able to tell that what we are getting is what it says on the label? I am really intrigued by this.

[George Eustice]

Well, as the hon. Gentleman will be aware, there is nothing to stop that happening now, apart from EU law. For 45 years we have relied on EU law being enforced in member states. We are simply saying that in the transitional period we anticipate that the EU will continue to abide by and enforce its own laws. If it becomes apparent that it no longer enforces its own laws, we have the powers in these measures to cease to recognise them, because we will maintain our standards.

In answer to the hon. Member for Edinburgh North and Leith (Deidre Brock), I can confirm that there are two slightly separate provisions on wine. First, we are bringing across only those provisions that relate specifically to wines that we produce in the UK, in relation to the production side. We have a growing and very successful wine industry, particularly in sparkling wines. We will not be bringing across those provisions for wines that we do not produce in this country and that are made in other countries. Secondly, we are making those labelling transitional provisions available to all EU producers so that there will be no short-term interruption in the administration procedures that they have to follow.

I hope that I have addressed the points raised by the shadow Minister and the hon. Member for Edinburgh North and Leith. I commend the regulations to the House.

Question put and agreed to.

draft Common Organisation of the Markets in Agricultural Products Framework (miscellaneous amendments, etc.) (eu exit) Regulations 2019 Draft Common organisation of the markets in agricultural products and common agricultural policy (miscellaneous amendments) (eu exit) regulations 2019 Draft Agriculture (Legislative Fuctions) (EU Exit) (No. 2) Regulations 2019

Debate between George Eustice and David Drew

Tuesday 26th March 2019 General Committees

[Dr Drew]

I am delighted to serve under your chairmanship, Mr Evans, and I welcome the Minister to his place. This is my third SI of the day, so if I sound tired, it is because I am tired—rather tired of SIs. Given that the Minister has worked out all the questions I was going to ask, my job could be relatively short. I had better think of some other questions, just to make sure that the civil servants earn their pay for the day. I also welcome the former Minister, the hon. Member for Camborne and Redruth, yet again. We have a double act here. He does this for free now, but he should not tell his colleagues that; they will think it is a good way forward, and we might get a few more of them acting in that way. We will say nothing more about that.

I state my usual caveat: we are doing these things in an incredibly rushed way, and mistakes will be made. In fact, the previous SI we considered was all about the mistakes in an SI from last week, so we are going back over what we went over. That will happen, given that we are going through these SIs at a rate of knots.

I am a simple soul, so I will take the SIs in some sort of order; otherwise I will get confused. There are four instruments, but effectively three statutory instruments. I am still trying to struggle through them, but I will try to make my explanation as simple as I can. The first is the draft Common Organisation of the Markets in Agricultural Products Framework (Miscellaneous Amendments, etc.) (EU Exit) Regulations 2019, which the Minister mentioned. Much of the subject matter is devolved, and I am intrigued about the extent to which there is an attempt to pull back to the centre some of the changes coming from the EU. The Minister touched on this and made the point about the Administration in Cardiff. I would like him to at least allay my fears that the devolved Administration are losing out in some way. I am sure that the Scottish National Party spokesman will have something to say about that.

This whole area of market structure is not easily picked up; I found it complex—perhaps I am not that clever. I know enough about pillar one, and the way it has worked for a long time, having studied it for a long time. There are issues to do with the lack of clarity on how this will be restructured, even though we are talking about just a transfer of powers, according to the Government. We are told these are technical regulations, but at least some stakeholders disagree with that and feel that there is a change in the relationship. Given the attempt to conflate all these SIs, we have to pick through them carefully.

The Minister outlined the different things covered by market organisation—public intervention, aid for private storage, aid schemes, marketing standards, producer organisations, import and export rules and price measures —all of which are covered by the transfer of powers, as far as I understand. As I said in my rant to the Minister’s colleague in the last SI Committee, the Opposition struggle because all the non-governmental organisations are struggling to keep up to date. I am glad that the Minister is meeting the NFU and CLA, but the various non-governmental organisations to whom I have spoken say that they do not have the capacity to undertake any scrutiny of these SIs because of their complexity and the speed with which they are moving through the House.

The NFU has, however, commented on the first SI. It sees producer organisations as being very important, so continuity as the European legislation becomes UK law is important, as is remaining exempt from competition law; if there is no exemption, it will complicate matters. That is particularly true of horticulture. I would welcome hearing from the Minister on that, so that we can be sure that there are genuinely no changes.

EU member states have been encouraged to work on strengthening routes to market; I know from talking to farmers that they see that as being where they should go. How will these SIs, which are all about market structure, encourage farmers to move closer to the marketplace without raising food prices? We have to be well aware of that. The issue is the degree to which these SIs touch on competition law, and whether the UK will have to revisit its competition law.

The second SI, the draft Common Organisation of the Markets in Agricultural Products and Common Agricultural Policy (Miscellaneous Amendments) (EU Exit) Regulations 2019, seems to anticipate future SIs. What are those future SIs and changes? How will they impinge on the way the market operates? Given that this has a lot to do with producer organisations, where is the financial analysis? That is the question that I always ask. Can we be assured that the burden will not fall on the producer organisations, which already suffer from market precariousness? In the short term, there will be churning in the policy vacuum—and there is bound to be a vacuum; things may operate seamlessly, but various questions will remain.

We have to look at where we are, and where we want to be, and make sure that policies are as fair, open and transparent as possible, because any unfair trading practices will undermine the point of trying to encourage producer organisations. That is borne out by what the NFU said to me. It believes that producer organisations are the way in which farm businesses should be moving, so that they can negotiate more successfully with retailers and directly with the customer.

Greener UK asked me a series of questions about the regulations. I will not go through all of them. It is concerned about how the effect of the changes on the environment will be monitored and measured in a fully transparent fashion. It wants to know how the searchlight will be turned on, and how we will make sure that procedures are fully operative as early as possible. That is all linked to the implementation of environmental law and policy. It is also interested in how we will deal with possible breaches, and that will reflect how citizens or civil society organisations will look at this. Greener UK has views on the fairness or unfairness of how things work. Producers and representatives of customers have questions about transparency, accountability, and what to do when things do not work as they should.

The draft Agriculture (Legislative Functions) (EU Exit) (No. 2) Regulations 2019 are much more about the structure itself, but concern such aspects as organic production and labelling, which we have talked about in previous Committees. It is important that we recognise that that sector needs greater protection, because it will undergo considerable changes. Although we have our own organic regulators in this country, so much of it is about commonality with the rest of the EU, and that will have to change.

The main issues are diverse, and extend to the functioning of age schemes, including for school milk and the fruit and vegetable scheme, which is of course about providing good-quality food to children, and subsidising the industry, to put it bluntly. The question is how can the Government realistically think that anyone, especially key stakeholders, can cover that? There is such a wide range of elements in the SI. The Minister said that the Government did not need to consult, but it would be interesting to know what consultation, if any, has taken place.

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

All we are doing with the SIs is substituting “a member state” for “national authority”, or replacing “Commission” with “the appropriate authority”, simply to make the existing regulations operable. The real question is where was our ability to scrutinise the original EU regulations that were imposed on us? Nobody generally bothered to look at them, barring the Ministers who were there at the time.

[Dr Drew]

The answer is that we could always do it better, and now we have no reason not to. It puts the onus on us, which is why the SIs are important. If we do not get it right now, it will come back to haunt us, either because we will have missed an opportunity or because we will have to revisit the SIs, as we did with those laid just a week or so ago. I accept what the former Minister says, but a whole series of market segments are affected by the CMO and the way in which the SI will operate.

The Government say that there are no costs, but somebody, somewhere, has to bear some of the costs, because there will be new regulatory burdens. As yet, the Government are not clear on how those burdens will be set up, and what form they will take. It would be interesting to understand the Government’s thinking on that, because unless we get the market structure right at least some of the different segments within the food industry will suffer, at least in the short run. Some of the legislation really matters, because it is about emergency measures, which we all ought to know about because of what has happened in previous food scares.

The Minister will be pleased to hear that my final point will be my usual entreaty about databases. We are looking at how we will set up a new databank—in this case, of isotopic data—to detect fraud. The current one is based on samples taken by the member states; we will have to replicate that in a UK context. It would be interesting to know where we are with all the wonderful IT innovations that the Government are trying to introduce, also at a speed of knots.

There is no date for this, so I do not know whether we will borrow stuff from the EU. Clearly, they have collected and stored a lot of material on, for example, the authenticity of wine and what level of sugar has been added, and how much water is in the wine. There is something biblical about that. If we are starting from scratch—I do not know whether we are—can we just bring all the information across, or do we have to pay for it? Alternatively, can we use comparable databases?

It is the usual questions. Where are the databases? How advanced are they in terms of their operation? Who will have access to them? If there is evidence of fraud in the way these different market sectors are operating, what do the Government intend to do? I have nothing more to ask. This is one of the more complex SIs of the many we have been through. As the Minister answered many of my questions to start with, I have come up with a few different ones, but I welcome that we are now getting the answers as well as the questions. It makes my job that much easier.

Draft Agriculture (Legislative Functions) (EU Exit) Regulations 2019 Draft Common Agricultural Policy (Financing, Management and Monitoring) (Miscellaneous Amendments) (EU Exit) Regulations 2019 Draft Common Agricultural Policy (Financing, Management and Monitoring Supplementary Provisions) (Miscellaneous Amendments) (EU Exit) Regulations 2019 Draft Common Agricultural Policy and Agriculture and Horticulture Development Board (Amendment etc.) (EU Exit) Regulations 2019

Debate between George Eustice and David Drew

Monday 25th March 2019 General Committees

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

I am delighted to serve under your chairmanship, Mr Hanson, and to welcome the Minister and the former Minister to their places. We are going to get doubled-barrelled explanations of everything that is going on.

I thought that last week I was getting to the nadir of my understanding of things, but these SIs are complex. In many respects, they are not controversial, but then, as the Minister rightly touched on, we get to the red meat levy. Those of us who were on the Committee in question spent a lot of time arguing whether it was appropriate, and the devolved Administrations do not necessarily agree with England on the issue. It would be interesting to know whether that has been properly worked through.

I refer back to the European Statutory Instruments Committee, which looked at the issue on 4 December. Its report quoted the instrument, which explains:

“Removing this levy will ensure that, following EU Exit, there will be equal treatment between the EU and the rest of the world for animals imported for slaughter. Defra’s estimate of the maximum financial impact to the AHDB caused by this change is a loss of c. £1,000 per year in levy, although it is believed that the amount actually collected by the AHDB in relation to the rest of the world imports are far lower than this and are probably nil.”

The Minister touched on that. The moneys exchanged seem very limited. I do not know why we have any regulation relating to that, if it is so unimportant. Can he enlighten us a little?

I will start with some general questions, because some points need to be brought out early on. I hope the Minister will get some help from somewhere to answer them. I am always willing to accept written contributions, although I have not received any yet. We have had rather a lot of SI Committees, and so far I am yet to have anyone write to me saying, “You should look at this to understand that,” or, “The Government intend to do this to move to that.” It would be useful to get some contributions so that I at least know that I am along the right lines, or that the Government have done it in the right way.

Under the common agricultural policy, there are payment windows. We have a lot of arguments over them, because they are often breached, and farmers or landowners do not get the money that they should currently get within those windows. Do these regulations in any way change those payment windows? It would be interesting to know what the Government’s contingency is if we were to crash out of the EU. Much of this is predicated on our having an Agriculture Bill in place. Sadly, it does not appear that there will be such a Bill in place, which has caused some consternation among the Opposition—let alone among Government Members—about what will happen if we are no further forward.

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

On that point, the hon. Gentleman is wrong. The Agriculture Bill is all about developing a future policy; these regulations, in common with all such regulations under the EU withdrawal Act, are about ensuring that the current EU scheme and retained EU law—including the common agricultural policy and all its provisions—are operable in the interim period.

[Dr Drew]

I agree with the hon. Gentleman, but there was supposed to be a seamless move from one to the other. It does not seem very seamless anymore; it seems rather senseless that we are unclear about where we are today—let alone where we will be in a week’s time—in relation to where we would possibly be going in terms of the Agriculture Bill, of which we have heard nothing. We suppose that it will crash out of the Government’s programme this year and we will have to revisit it again next year. We are not really going forward at a rate of knots.

Those who criticise the common agricultural policy—no doubt there are many in this room today—will question the fitness of the legislation as it stands and as it will stand tomorrow should these regulations go through. Farmers are calling for improved systems, so was this not the opportunity—notwithstanding what I said about payment windows—to look at how the system would be improved? Throughout the Agriculture Bill, I have called for the scrapping of the Rural Payments Agency and for its replacement with a new, purpose-built body. Unfortunately, we do not seem to have got any further with that.

My next question is about the limited consultation. Yes, it is true that farming organisations were consulted. However, given that we are moving towards environmental payments, it was really quite a narrow consultation. What about the different environmental organisations that have contributed, largely through the Green Alliance? As the Minister knows, they are very critical of this process and how it has been taken forward. Why were they not directly consulted about these statutory instruments? That would at least have been commensurate with the direction of travel.

I will make two more general points, before I comment on specific bits of legislation. Given our learned experience from having been a member of the CAP for 43 years, it would be useful to know why these SIs could not take account of some of the direction of change.

My last general point is about what the Minister said about there being a series of technical amendments. But this involves direct payments, which is one of the more controversial areas—as we know, through the Agriculture Bill—between the four home countries. When I talked to the Ulster Farmers Union and said, “Of course, we will be removing direct payments,” its representatives basically intimated: “Over our dead bodies!” They believe that direct payments have a strong and continuing role to play in keeping people on the land in Northern Ireland. Since we debated the issue during the Agriculture Bill, have we got any further forward on how we intend to deal with a very different approach? [Interruption.] If the Minister wants to intervene—

[George Eustice]

indicated dissent.

[Dr Drew]

Sorry, the former Minister; I am still getting used to all the different roles being played.

I am intrigued about where we are with those four different approaches: Scotland has its own approach and did not want to make its statement through the Agriculture Bill; Wales is largely in common with England, but has made its own contribution to the changes; and, because there is no Administration in Belfast, we are not at all sure what Northern Ireland is doing. But let us go on to the three bits of legislation.

The draft Common Agricultural Policy (Financing, Management and Monitoring) (Miscellaneous Amendments) (EU Exit) Regulations 2019 again come down to money. I am interested to know whether the Government, through the SIs, will commit to exactly the same moneys being available today and tomorrow, regardless of what happens next week. It would be useful to know whether the Government are prepared to make that commitment of the £3.1 billion or £3.2 billion, which would work its way through to the system. As I said, the Ulster Farmers Union in particular is very clear about wishing to continue with direct payments. How does that impact on the way in which the other parts of the UK will respond?

The Soil Association, although not part of the direct consultation, looked at the issue. It is clear about welcoming the Government’s direction of travel but, again, questions whether the draft SI makes any difference to the programme under which, starting in 2021, we gradually run down direct payments. That would be interesting to know in connection with the draft SIs, given that we have no Agriculture Bill coming through. We are only talking about 18 months away now, so it is not way in the future—this is in the foreseeable future, and farmers are already making calculations about their investments.

The National Farmers Union brought up the point, which the Minister did not mention, that there are now criminal offences for breaching financial assistance schemes. Will he say something about that? The NFU is unhappy about it. Will these SIs mean that obstruction of a person acting in pursuance of the regulations could result in the farmer or landowner facing a financial penalty or worse? Again, some of the conflicts that arise out there are difficult to resolve without clarity of thinking and a much clearer explanation of the impact of these SIs.

The draft Common Agricultural Policy (Financing, Management and Monitoring Supplementary Provisions) (Miscellaneous Amendments) (EU Exit) Regulations 2019 largely concern the budget and the income-support system. One presumes that in the short run we will carry on with the existing structure, because we have no Agriculture Bill and because unless we give farmers the moneys that they thought they were getting, they would be at a distinct disadvantage in competing with other parts of the European Union—in particular in Ireland; Northern Ireland would not want to be at any disadvantage.

We laid down some pretty strong targets in the Agriculture Bill, but how does that relate to the draft statutory instruments? The Nature Friendly Farming Network, for example, wants much longer-term commitments on moves towards soil management, protection of water and the rest of it. Again, that is all wrapped up in the environmental management schemes, which are not part of these SIs, but unless we get things right, farmers will be at a disadvantage in the meantime.

The last instrument is the draft Common Agricultural Policy and Agriculture and Horticulture Development Board (Amendment etc.) (EU Exit) Regulations 2019. This has been mapped out and spoken about on many occasions by the Secretary of State, but the real issue is how to move from direct payments to environmental payments. Sustain in particular was worried about whether the new shared prosperity fund—the Minister will say that it is not affected by the SI, but that is contingent on the Government’s direction of travel—will be administered by DEFRA or go to the Ministry of Housing, Communities and Local Government, as Sustain fears it might. Where will the moneys for environmental payments be set aside in the interim?

The Ramblers’ Association has made some points about how cross-compliance will essentially alter things, come what may, because of how the Rural Payments Agency has itself been reformed. We know that there is a problem with countryside stewardship for various landowners—the hon. Member for Camborne and Redruth talked about that on the Agriculture Bill Committee, when he was the Minister. It would be interesting to know how that cross-compliance will operate not only through the new Bill, but with respect to the regulations before the Committee. They constitute the interim policy; if we do not get that right, farmers, landowners and environmentalists will be disadvantaged.

Draft Plant Protection Products (Miscellaneous amendments) (EU Exit) Regulations 2019 Draft Pesticides (Maximum Residue Levels) (Amendment Etc.) Regulations 2019

Debate between George Eustice and David Drew

Thursday 21st February 2019 General Committees

[George Eustice]

I want to draw on some of the points made by the shadow Minister, the hon. Member for Stroud. I will return to the comments of my right hon. Friend the Member for Scarborough and Whitby at the end.

The first thing to note is that the current regulation that governs active substances is Regulation (EC) 1107/2009. Our own HSE was largely instrumental in the drafting of it. I have to point out to the hon. Member for Stroud that the then Labour Government voted against that infrastructure despite the fact that we had been involved in drafting it on the basis that they did not agree with the hazard-based principle. Nevertheless, we as a Government are bringing across the existing regime, with all its imperfections, including the hazard-based principle. We are bringing it over exactly as it is and placing it on the UK statute book.

To address the point raised by my right hon. Friend the Member for Scarborough and Whitby, who is obviously anxious to do things better, yes there are indeed opportunities to do things better and to refine the system, but that is a discussion for another day. We are absolutely crystal clear that the EU (Withdrawal) Act is about bringing across the existing regulatory structure. It seeks to make no policy changes whatever, and the regulations make no changes whatever.

To draw on the point about HSE resources, probably only the eight largest member states of the European Union have any meaningful capacity to do such work on pesticides. The UK is renowned in Europe for being the leader in terms of the scale and scope of our expertise. As the hon. Member for Stroud says, we have 150 experts on pesticides in the chemical regulations directorate. We have identified that there will be an additional workload. Scoping work has suggested that the directorate will probably need another 40 members of staff. The directorate has commenced that work, and we have identified that we will probably need to give it an additional £5 million a year to do it. The hon. Gentleman should recognise that the directorate already does the bulk of the work. It is simply fiction to think that the European Union does it. The European Union has an oversight role and owns the regulations, but the actual work—the technical evaluation—is already done by our own Health and Safety Executive.

[Dr Drew]

If we are not doing that work for the EU, the EU will have a huge hole. Obviously, we will have to check food that comes into this country because of the potential that the EU now might not be as effective. Is that not the reality?

[George Eustice]

It is very much the case that I would be open to saying that, as part of any future partnership, we should still have wider European technical working groups, so that the European Union can continue to benefit from British expertise but, at the moment, we are obviously not at the point of being able to advance discussions at that level of detail—as things stand, we are struggling to get a withdrawal agreement agreed by both sides at all.

Oral Answers to Questions

Debate between George Eustice and David Drew

Thursday 21st February 2019 Commons Chamber

[George Eustice]

My hon. Friend the Member for Cleethorpes (Martin Vickers) has also raised the case of Cherry Valley, and I have given an undertaking that I will meet it as soon as possible. The company exports live ducklings and imports ducks, and I am happy to look at its concerns. Obviously, on the wider issue, the Prime Minister absolutely wants to avoid no deal. That is why she is encouraging everyone to back the agreement that she has secured.

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

It would be nice to know when the Agriculture Bill is coming back to this place, given the months that have now fallen by the wayside. I ask the Minister on behalf of his boss, the Secretary of State: how are discussions going with the Chancellor on whether there will be tariffs on food imports?

[George Eustice]

The Government are currently in discussions about a tariff policy in the event of no deal. The options that are open to us are to have tariff rate suspensions, which we are likely to do on goods that we do not produce, and to have autonomous tariff rate quotas or lower applied tariffs. That issue is being considered by the Government and a statutory instrument will be laid before Parliament in due course.

Oral Answers to Questions

Debate between George Eustice and David Drew

Thursday 17th January 2019 Commons Chamber

[George Eustice]

There are two ways in which a UK framework can be delivered. First, it is important to recognise that agriculture is devolved. Although the Welsh Government have asked us to add a schedule to our Bill, which is currently going through Parliament, they also intend to introduce their own future legislation. There are provisions relating to compliance with WTO rules, and the Department for Business, Energy and Industrial Strategy will also provide an approach to state aid rules.

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

On Tuesday, I met members of the Irish Farmers’ Association—there were other things going on as well as the debate—and they made it very clear to me how vital it is to get a long-term customs arrangement in place as soon as possible. They say that that view is shared by farmers in Northern Ireland. What is the Department for Environment, Food and Rural Affairs doing to make sure that that happens?

[George Eustice]

As was made clear at the very start of this session, the Secretary of State is, as we speak, in dialogue with Members of this House to establish a consensus, so that we can indeed have a customs arrangement after March.

[Dr Drew]

The Minister has been quite sanguine in saying that he now supports the Norway option. Is that view shared by the rest of the DEFRA team?

[George Eustice]

The DEFRA team, which includes me, supported the Prime Minister’s deal, because the deal that she brought forward was the way to most closely deliver the outcome of the referendum. That deal has now been rejected by this House, so of course we must consider all alternatives.

Oral Answers to Questions

Debate between George Eustice and David Drew

Thursday 29th November 2018 Commons Chamber

[George Eustice]

My hon. Friend made his case powerfully in Committee. He will recall that, as a result, I undertook to give this issue further consideration and have further discussion with colleagues in government in time for Report.

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

The discussion in the Agriculture Bill Committee was very good, but unfortunately the Government chose not to accept our amendments, so I congratulate the hon. Member for Tiverton and Honiton (Neil Parish) and the whole of the Select Committee on tabling theirs. I hope the Minister will confirm today that he will accept that amendment.

[George Eustice]

As I have explained, I do not believe that that particular amendment is the right way to approach the issue, nor is the Agriculture Bill the right place for such an amendment, as this is a trade issue. Nevertheless, I gave an undertaking to have conversations and discussions with other Departments in time for Report.

Agriculture Bill (Fourteenth sitting)

Debate between George Eustice and David Drew

Committee Debate: 14th sitting: House of Commons
Tuesday 20th November 2018 Public Bill Committees

[Dr Drew]

If the Minister wants to say today that he has some brand spanking new agency in his back pocket that is going to take over and run this, we are more than happy to listen and give our support. I am merely the messenger saying that I still receive countless complaints about late payments, wrong payments and reasons unknown for people not receiving the moneys they thought they should have received. The field margins and the way in which the scheme was set up was unduly complicated, but this will potentially be as complicated, and some would say more complicated.

Why can we not just listen and learn from past mistakes and at least give people an opportunity to help frame what could replace the Rural Payments Agency? It has already taken on many Natural England employees, so it is ready for its new incarnation, but I am worried about skill levels, about the computer system and about how this will be perceived if we start on the back foot with an agency that has not been fit for purpose.

I will not cast aspersions on the people who work for the RPA—no doubt they work long hours to try to get things right—but there has been something integrally wrong with the way it has operated for a long time. I am giving the Minister an open goal to shoot at—a way for us to move forward across the party divide to try to get an agency that is fit for purpose for a very different type of agricultural scheme.

[George Eustice]

I will describe in a moment what we are doing on future regulation, including the enforcement of this scheme. However, the hon. Gentleman gave me an opportunity—an “open goal”, as he said—to, for want of a better term, shoot at the RPA. I am not going to do that. As I have said many times, the RPA and agencies such as Natural England are currently grappling with a truly hideous body of European regulations and an unbearable administration process. That causes huge problems for farmers, who are required to fill out and submit endless forms and do lots of mapping, and for our administrators, including the RPA.

The problems we had last year, for instance, were caused because EU law required us to re-map 2 million fields in one go. We would not have chosen to do that—there was not really a need to re-map the fields—but we were forced to, just to ensure that there were no ineligible trees littered around the landscape. The sheer scale of that task caused administrative problems. The problems we have had with our countryside stewardship schemes were caused primarily because the European Union passed a rule that said every scheme must start on the same day of the year, which caused a massive spike in workload, required us to employ 500 temps and created all the contingent problems that come with that. In the design of the new scheme, we can learn lessons from the past and jettison some of the muddled thinking that is imposed on us by the European Union and EU auditors.

I should also point out that the RPA has taken on some of the payment functions related to the pillar two countryside stewardship schemes, precisely because not only the RPA has had challenges. Natural England has had horrendous problems trying to implement the countryside stewardship scheme. Indeed, one of the reasons we moved the RPA in to take over that space was that it has a stronger track record of managing complex EU processes.

Let me turn to what we intend to do in the future. The substance of new clause 18 is very much being addressed by the work currently being undertaken by Dame Glenys Stacey, who has given early indications of her direction of travel. She argues that we should move away from the clunky clipboard-and-rulebook approach inherent in the EU system and towards a much more modern way of regulating farms so there is more of what she calls social regulation, more incentives, fewer arbitrary rules and more whole-farm assessment. The work she has started is very interesting. She is also looking at the issue of our having multiple agencies and whether there could be consolidation, and at the establishment of a new type of body to perform some of these functions.

I do not believe there is a need to consult now, as the new clause would require us to. The first step is for us to see the final report from Dame Glenys Stacey. If the Government decided at a future date to implement some of the recommendations in that report, perhaps including the consideration of a new body, that would be the time to consult.

[Dr Drew]

I hear what the Minister says. Again, I make the point that that is why we would have liked to hear from Dame Glenys about the direction of travel in the evidence sessions. Perhaps we can pick that up subsequently. I am not aware whether she has yet given evidence to the Select Committee on Environment, Food and Rural Affairs. I hope members of that Committee who are present heard that point, because it is important that we get an early idea of what the Government’s approach is likely to be.

I will not labour the point, because there are other new clauses that we want to get to before the bewitching hour, which you reminded us of, Sir Roger. However, it is crucial that whatever agency takes it on needs to be capable—I will not say “ of starting with a blank sheet of paper”, because the past cannot be washed away—of recognising the problems that there have been and still are with the way the current payment systems operate.

As much as new systems come with a certain élan and opportunity, the same people will operate the new system, so we have to ensure that training, empowerment and particularly a decent IT system that does what we want it to do are in place right at the start. That was what really damned the RPA when it took over the area payment scheme. It was trying to negotiate the system as it went along, and as we know that that was sadly an unmitigated failure. I beg to ask leave to withdraw the motion.

Clause, by leave, withdrawn.

New Clause 21

Agricultural co-operatives

“(1) The Secretary of State must promote agricultural co-operatives by—

(a) offering financial assistance for the creation or development of agricultural co-operatives, and

(b) establishing bodies to provide practical support and guidance for the development of new co-operatives.

(2) The Secretary of State shall examine any proposal for primary or secondary legislation to assess—

(a) its impact upon agricultural co-operatives, and

(b) whether that impact is disproportionate in relation to its impact upon other producer organisations or interbranch organisations.

(3) Financial assistance under subsection (1) may be given by way of grant, loan or guarantee, or in any other form.

(4) An organisation shall be recognised as an agricultural co-operative if it meets the conditions in subsections (5) and (6).

(5) Condition 1 is that the organisation—

(a) is registered with the Financial Conduct Authority as a co-operative, or

(b) is constituted under the Co-operatives and Community Benefit Societies Act 2014.

(6) Condition 2 is that the organisation—

(a) operates in a sector which is listed in Part 2 of Schedule 1 to this Act, and

(b) includes at least one member which is an agricultural or horticultural producer.

(7) The Secretary of State may by regulations make provision specifying the criteria under which financial assistance under subsection (1)(a) may be offered.

(8) Regulations under subsection (7) are subject to the negative resolution procedure.”—(Dr Drew.)

This new clause would require the Secretary of State to promote agricultural co-operatives.

Brought up, and read the First time.

--- Later in debate ---

[George Eustice]

I am more than happy to take up the hon. Gentleman’s suggestion to say nice things about co-operatives. As I said in an earlier sitting, I am a supporter of collaborative working, joint working, joint ventures and co-operative approaches to help farmers deal with the fact that often they are fragmented and end up as price takers in the supply chain.

We have done a number of things already. Earlier this year, I announced a £10 million collaboration fund out of the rural development programme to support joint working and to support the formation of co-operatives. The hon. Member for Stroud will also remember from an earlier discussion on clause 22 and the recognition of producer organisations that we had meetings with the co-operatives’ representatives and have taken on board some of the suggestions that they made. We tabled a Government amendment to clause 22 to ensure that models other than that of a limited company, which is the requirement under current EU law, are recognised as producer organisations.

On the substance of new clause 21, which would ensure that there is financial assistance for co-operatives, I am happy to take the opportunity to confirm that, just like the existing rural development programme, clause 1(2) —the subsection on productivity—enables us to make available grant support, Government-backed loans or other guarantees to the co-operatives, should we want to support their endeavours. It is not only clauses 22 and 23, on exemption from competition law, that help certain co-operatives and recognised UK producer organisations; the very first clause of the Bill has provisions for our giving financial assistance to co-operatives. By establishing the £10 million collaboration fund earlier this year, I hope that I have demonstrated through my deeds rather than my words that I see this as important. Should the hon. Member for Stroud ever be in Government, I hope that he would do the same and continue to support these important organisations.

[Dr Drew]

Of course—I am a Co-operative MP. We would not see a conflict of interests; we would see a commonality of purpose, which we encourage. I find what the Minister said very encouraging, and I hope that he will continue his discussions with Co-operatives UK and other farming organisations to see how this can be developed. The UK farming and environmental sector will need to co-operate if we face Brexit, because it will be subject to many of the winds of change, some of which could be very turbulent. I hope that co-operation is one good thing that comes out of this. I beg leave to withdraw the motion.

Clause, by leave, withdrawn.

New Clause 22

Import of foie gras

“(1) Foie gras may not be imported into the UK.

(2) “Foie gras”, for the purposes of this section, shall mean a product derived from the liver of any goose or duck which has been force-fed for the purpose of enlarging its liver.”—(Dr Drew.)

This new clause would prevent the import of foie gras into the UK.

Brought up, and read the First time.

--- Later in debate ---

[Dr Drew]

Of course, and that is something that we will no doubt have to revisit on Report. We are not doing anything other than what we have done in this place. We banned foie gras in the Houses of Parliament. That is a decision, and one might say that it is freedom of choice, but we banned the production of foie gras in this country, as my hon. Friend the Member for Bristol East said, because we see it as inherently cruel.

All we are saying is: “Let’s have a level playing field”. If we ban production here, why are we still allowing imports to a very small number of establishments that still condone something that we would put at the extremes of animal cruelty? It is not about animal rights; it is purely about animal cruelty. It is a terrible process and I am not going to upset the hon. Member for North Dorset by going through what is involved. I do not think anybody would say that is an acceptable way to treat livestock. If it is, why is it banned in this country?

I hope we will get support from the Government. This is one thing they could do, through legislation on animal sentencing or even animal sentience, whichever comes first. We do not have many opportunities to pass this type of legislation. It could be done by a private Member’s Bill but we know how uncertain that can be. That is why the proposal has been brought forward at this stage, and why we hope there is support. If not, the Government could at least say what their intentions are. This will not affect farmers in this country, because we have banned this practice. We just want a level playing field and we can now ensure that because we will not necessarily be part of the EEA.

[George Eustice]

This again highlights an important ethical issue, about which people in this country have strong views. However, in common with others, I do not think it fits in the Bill. This is not a trade Bill; it is an agriculture Bill about how we support agriculture and replace the common agricultural policy.

I do not think we have ever produced foie gras in this country. It has been illegal at least since the Protection of Animals Act 1911, and the Animal Welfare Act 2006 put it beyond doubt. There is no explicit ban on foie gras, in the way that there is on fur farming, which was introduced as a specific ban in Parliament, but it has always been understood that the production process involved in it, requiring as it does the force-feeding of ducks and geese, creates serious animal welfare concerns. If ever practised here, that would be in breach of our long-standing animal welfare legislation.

There is a small amount of production in some parts of the world, including France, of what is called “ethical foie gras”, where they use a particular breed of goose and do not force-feed them. They manage to get a product that is very similar to foie gras in a way that causes far less concern for the welfare of the animal.

Turning to the proposed new clause, the issue is important. If we leave the EU, depending on the nature of any agreement we have with the EU, a future Government would certainly be able to ban the import of foie gras. Some countries, notably India, do have ethical bans of this sort. India has one on fur and might already have one on foie gras.

We know that WTO case law means it is entirely in order to have bans on certain products of this sort, where there are ethical reasons to do so. There has been case law in the past regarding seal furs that has upheld that long-standing principle. It would be an option for a Government, depending on the nature of the agreement we finally have with the EU, to ban the import of foie gras, in much the same way as India does, but I do not believe the Bill is the right place for it.

It is the kind of thing that we would consider once we are clear about the type of trading relationship we will have with the EU and what concessions we might have to make as part of that settlement—until then we are not in a position to advance any policies of this sort.

[Dr Drew]

I hear what the Minister says but, given that the Bill looks to the future, it is entirely appropriate that we decide which animal welfare standards we believe should be in place to accommodate the type of agriculture and food chain we want. Although subject to whatever happens to our relationship with the EU, this is the sort of legislation, along with live exports, where we should draw a line in the sand. We do not accept this practice; we have banned it. It is inappropriate for agencies, shops and other retail establishments to be able to sell that product here. It is an entirely inappropriate method of force-feeding geese and ducks. This is a key animal welfare issue. It needs to be outlawed.

--- Later in debate ---

[Dr Drew]

I agree entirely. In this brave new world, we are talking about supporting not just farmers and landowners, but the environmentalists who are going to come in and do some of the work. Again, this area is rife with exploitation. It is right that lots of people work as volunteers or are seconded from their companies, but there is the danger that that will become the norm. Unless we are careful, we have no regularity of employment structure.

The Government’s argument has always been, “Why is agriculture different? It is the same as any other sector.” Well, it is different. The nature of the work is different: it is hard and the hours are long. There is also the issue of loneliness, because most workers are by themselves. There will perhaps be only one or two of them if they work for a small holding. Larger holdings have more, of course, and are able to get protection through their numbers.

I understand the NFU’s position, but farmers tell me that one of the things they most regret is the loss of the negotiating apparatus. They say that quietly; they will not say it to a wider audience. There are those who believe strongly that losing the negotiating apparatus has taken agriculture backwards. When we lost it, we saw that agriculture was not valued enough for such a structure to be in place. If the Minister does not agree with this new clause, I hope he at least recognises that there is merit in putting in place a structure and systems to ensure stability in farm workers’ terms and conditions. Too often, they are not paid the going rate, which means that people are not attracted to the countryside, which we all accept is a tragedy.

[George Eustice]

We had a similar discussion about an amendment earlier. I do not intend to speak for too long, but the hon. Gentleman will be aware that I disagree with him for reasons that I have set out. As he knows, the Agricultural Wages Board was established way back in 1948. There were lots of other boards around at that time, covering different sectors. Most of them were phased out during the ’60s, ’70s and ’80s; the Agricultural Wages Board was the last one standing.

Things changed fundamentally. There was a review of the Agricultural Wages Board in the mid-1990s, and in the end a decision was made not to take action. After the national minimum wage was introduced by the previous Labour Government and adopted by the Conservative Government, and, more importantly, after this Conservative Government introduced the new national living wage, the Agricultural Wages Board’s raison d’être was no longer there. It has been superseded by other pieces of legislation and minimum wage requirements. We currently have a national minimum wage of £7.83, and the national living wage is soon to go to £8.75. We therefore already have protections through the National Minimum Wage Act 1998, the Employment Rights Act 1996 and the Equality Act 2010. There is lots of legislation to protect agricultural wages.

I do not share the hon. Gentleman’s view that the negotiating apparatus that operated alongside the Agricultural Wages Board is necessary. There were problems with the way that it worked. It did not, for instance, allow the payment of annual salaries to some management staff so hours and payments could be averaged across the year. That would help people get mortgages to buy homes. There were reports that, because people received a weekly wage based only on the hourly rate, it was difficult for them to demonstrate to mortgage lenders that they satisfied their criteria.

More importantly, the very formulaic tiers of wages did not enable people who were doing particularly well and were on their way to progression or to a management role to be rewarded, unless they had the right craftsman qualification. It took away employers’ flexibility to reward their staff, because everything was set in a very formulaic way. I do not share the hon. Gentleman’s romantic view of the Agricultural Wages Board; it was restrictive and stopped more progressive approaches to payments, including salary development. Insofar as it gave protection for minimum wages, its role has been superseded.

[Dr Drew]

My wife would say I was never romantic, although I do not want to disillusion the Minister too much. This is not about going back. There would have to be a new body, but it would perhaps take account of sectoral organisations—that was what was probably wrong with the old Agricultural Wages Board. The NFU always saw it as a one-size-fits-all.

A modern Agricultural Wages Board must take account of the different sectors and regions. Its whole point is that it underpins wages and conditions. We feel very strongly about that. We talked to Unite, the main representative body that came out of the old National Union of Agricultural and Allied Workers. Historically, Unite has always been linked to the Labour party, although it has not always agreed with it. Although we look back in this sense, we also recognise the modern world.

--- Later in debate ---

[Dr Drew]

I will let the Minister respond to that in due course. We started with a fairly narrow subject and we have probably been round every other subject possible. I am not going to take any more interventions.

We have a policy on this issue. We argued 20 years ago that we wanted to bring it forward. It has not happened because of our relationship with the EU. If that relationship remained or got to the issue of the customs union, it might still be precluded. However, if we were to leave the EU, we would have the opportunity to do this. That is why the Opposition have upheld the policy and will press the matter to a vote: so that there is some clarity, which has not been forthcoming from the Government because Government MPs have been arguing for the ban on live exports for some time. No doubt, we will continue this discourse outside. I make no apology for saying that this is the opportunity for us to do this. We will be taking that opportunity and pressing for a formal vote on live exports.

[George Eustice]

The Government have a policy on the issue as well. As the hon. Gentleman will be aware, in our manifesto we committed to control the export of live animals for slaughter. I will describe in a moment what we intend to do and what work we have already done.

--- Later in debate ---

[Dr Drew]

I think that is a hint. Given we did not divide on live exports, we might divide on pesticides instead. It is important to have this debate and look at this opportunity. The new clause is not doing anything dramatic. It asks us to use this piece of legislation to review current pesticide use, to consult on it, and to monitor it better. It says that that is something that should be in land management contracts. If it is not included, how can we find a way to secure a measurable improvement in our environment? As my hon. Friend the Member for Gower says, we only have to look at our watercourses to know that pesticides get into them. Most of us see that as unacceptable and we have to do something about it.

[George Eustice]

I hope I will be able to persuade the shadow Minister that he does not need to press the new clause to a Division. We rehearsed in an earlier discussion on clause 1 the fact that the Government are actively looking at holistic schemes to support and incentivise what could be called integrated pest management. We are considering whether we can reduce our reliance on synthetic chemistry by using more natural predators and different agronomic approaches and being willing for the first time to incentivise farmers financially to do that.

One of the things we are looking at is an incentivised integrated pest management scheme to advance this policy agenda. We also set out in our 25-year environment plan the idea of moving forward and embracing integrated pest management more than we have done previously. The new clause deals with publishing reports and measuring impacts—I have said previously that DEFRA needs no encouragement to produce reports through statutory requirements; we love reports. As I explained, I regularly have to read and sign off reports and I sometimes question whether anyone else is reading them. For some reason, many reports seems to congregate around June, so during that month my box is weighed down with annual reports of one sort or another.

I will share with the hon. Gentleman some of the reports that we have received. I have a lot of reading here that he can take away as a memento of this Committee. The UK Expert Committee on Pesticides—the ECP—which gives us advice on emergency authorisations and on some of the tricky chemical issues. It is a standing advisory committee to the Chemicals Regulation Directorate. I have with me its annual report for 2017, all 22 pages of it. The Expert Committee on Pesticide Residues in Food produces a separate annual report, on top of the one by the Expert Committee on Pesticides, so we have two expert committees in the pesticides space, one on residues and one on broader environmental impacts, both of which produce a report. The report on pesticide residues lists all the findings and surveillance on residues on a wide range of imported products and products produced domestically. It runs to 48 pages and is an annual report.

If that is not enough for the hon. Gentleman, the pesticide usage survey report, is produced by the National Statistics Office and focuses on all sorts of different icrops. I have with me the 2016 report for arable crops, all 92 pages of it, with lots of tables demonstrating exactly what is produced. That key survey already monitors the use of pesticide-active substances on each crop.

[George Eustice]

My right hon. Friend is correct: schemes such as the red tractor assurance scheme have additional checks and enforcement to ensure that there is nothing out of order, and on top of that they generally require MOTs, for instance, for sprayer equipment.

The pesticide usage survey covers the frequency of application, which picks up the measures in subsection (1)(c) of the new clause, and the area treated, which covers subsection (2)(d), as well as the weight of active substance. It also includes figures on some of the alternatives to chemicals, such as the use of viruses that can target insect pests. In addition, the National Poisons Information Service collects and considers reports of possible harm to people, which covers subsection (2)(b). Results are not published, but they are reported to DEFRA and other interested Departments, as well as to the UK Expert Committee on Pesticides.

Finally, the Wildlife Incident Investigation Scheme looks at reported incidents of possible harm to wildlife, which I think is what subsection (2)(a) of the new clause is trying to get at. Results of the Wildlife Incident Investigation Scheme are published on the Health and Safety Executive website, and the Environment Agency also monitors levels of pesticides in water.

I understand that there are very good intentions behind the new clause, but I hope that I can reassure the hon. Member for Stroud that we have a plethora of reports that cover pesticide use and pesticide issues in great detail. I hope he will withdraw his new clause at this stage, take some time to read the reports, which I would be happy to leave with him, and consider whether he still feels the measure is necessary on Report.

[Dr Drew]

It was always a good teaching ploy, when someone was really stuck, to give the kids lots of reading on the basis that that person could try to escape from the fact that they did not really know what they were talking about, hoping that the kids might be able to tell them in due course. That is just me as an old-fashioned teacher. I look forward to receiving the documents the Minister will give me to read, but I will press this to a vote, because the Government need to understand that the direction of travel is about environmental moneys being paid for environmental goods, whatever an environmental good is—it will be interesting to define that in due course.

Like previous versions of the Department, DEFRA has undertaken huge amounts of consultation, but when it comes down to it, it is about the action on the ground. It is important that we know that pesticide use will be one of the features that will be measured. As my hon. Friend the Member for Gower says, one would assume that over a period of time, when pesticides get into watercourses, that will be picked up and dealt with under land management contracts, so that someone will lose their money if they are seen to be polluting the local brooks. Otherwise, what is the point of this particular bit of legislation? We have both to lay down the law and to see how it will be enforced in practice.

Pesticides are a pretty important aspect of what happens to our landscape. I have always bought the argument that farmers, for all sorts of reasons, would want to spend less money on them, because it is an imputed cost and they feel very strongly that they want to minimise their costs, but sadly we have seen that many aspects of the environmental degradation of our countryside were down to misuse of pesticides, which have been seen as a shortcut to getting more output from farms. That is why we will put this motion to a vote. We let the Government get away on live exports, although that will no doubt come back.

On this motion, what is the point of environmental moneys if they are not properly scrutinised on the ground? Whoever may be advising is one thing, but this is something that presumably the payments agency will have to measure. Unless we have something that sets that out in the Bill, it will come down to vague promises. That is not acceptable in legislation. We either do it properly or we do not do it at all. Let us do it properly.

Question put, That the clause be read a Second time.

--- Later in debate ---

[George Eustice]

A possession order would require a bank to justify its action to a court before being able to take anyone’s land. There have been a number of issues with secondary lenders, and mainstream banks, moving aggressively to seize and auction land, and selling it in a reckless way that is against the interests of the landowner and their creditors because they have that charge over the land. That area needs to be looked at.

With the confirmation that we have not forgotten those areas, and that we are looking at a consultation, I hope that the hon. Member for Stroud will not feel the need to press the new clause to a vote.

It has been a pleasure to serve under your chairmanship, Sir Roger, and that of Mr Wilson. We have had a good-natured debate on new clause 31 and all the other amendments and clauses in the Bill. We have done a thorough job of examining every clause and amendment in great detail. I thank every member of the Committee for giving up their time and diligently intervening and contributing to the discussion.

I also thank my officials in DEFRA, who have worked incredibly hard. The Bill is the first substantive piece of legislation on agriculture that we have had since 1947. It has been a huge piece of work. Finally, and by no means least, I thank the Clerks. We particularly tested their patience when changing the plan for evidence sessions at the beginning, but I hope that we have been less difficult since then. We are grateful for the time and effort that they have put in.

[Dr Drew]

On that note, I particularly thank Mr Fox, who has been so helpful to Rob, who has done the Opposition work in detail. It is important that we put that on the record. Without the Clerks, Bill proceedings would not go very far, or if they did, they would go in completely the wrong direction. I also pay due regard to the many contributors to the evidence sessions, which were illuminating, and those who have given us ideas and interesting amendments. Some of them caused us a few sleepless nights in deciding whether to table them. They were all suggested in the right spirit, to try to improve the legislation.

Clearly the Government have a different view to the Opposition about how the legislation will progress, but we will see whether we can further improve it on Report, on Third Reading and in the House of Lords. It is good that the arguments have been had. Others will read them and see whether the proposals can be introduced in a different way, if not necessarily one with which the Government will wholeheartedly agree. However, given what happened today with the Finance Bill, we live in hope, and in the expectation that a degree of consensus is breaking out across the House. That is the way that good Government can operate.

On tenancy reform, I was pleased by what the Minister said. New clause 31 was a probing amendment, and the Minister knows where it was coming from. Changes are needed in this area. I hear what he said about repossession, which has always been a bone of contention in wider agricultural areas, because people do not necessarily just think in terms of those directly affected. It can unhinge a wider part of the countryside when people think that what has happened has not been done in the right way. It is important that we heard what the Minister said, and that we see some progress on that.

Without more ado, we have managed to complete consideration within the timeframe thanks to the good chairmanship of our two Chairs. I will not press the new clause to a vote, but I hope that, now it is on the record, we will hear early in the new year what form the necessary legal changes, which will presumably be made through secondary legislation, can take. We will of course scrutinise them in the right way and hope that they improve what is happening out there. We need good tenants with good tenancy legislation. British farming will be stronger because of that. I beg to ask leave to withdraw the motion.

Clause, by leave, withdrawn.

Amendment made: 43, in title, line 14, after “Agriculture;” insert

“to make provision about red meat levy in Great Britain;”.—(George Eustice.)

An amendment to the long title is required to cover the content of NC4 which is not covered by any of the other specific limbs of the current text.

Agriculture Bill (Thirteenth sitting)

Debate between George Eustice and David Drew

Tuesday 20th November 2018 Public Bill Committees

[George Eustice]

There is a lot of work to do. There are 92 different statutory instruments that we have had to put down in preparation for Brexit. Each of the devolved Administrations have had to do a large number of SIs themselves, and there has been an enormous amount of joint working at official level to share clauses and the legal drafting that our own parliamentary counsel has done, with the assistance of other devolved officials. We also now have 54 different Brexit projects, all of them about areas where we effectively have to either agree joint approaches or concordats, or agree that we will leave things fully devolved.

There is a large number of those projects. We discussed them yesterday. About one third of them are rated as being in the green box—everything has to be red, amber or green these days—recognising that there is already an agreement about how to proceed. On a number of others, more discussions are still needed, but that was highlighted yesterday. In the month ahead, there will be a lot of detailed working between officials.

I hope I have been able to reassure the hon. Member for Ceredigion that, through both the review of the JMC and putting the group that the Welsh Government proposed yesterday on a more formal footing, together with our plan for concordats and memorandums of understanding, we will address his concern, and that on that basis he will consider withdrawing his amendment.

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

We think there is considerable merit in this new clause, and we hope that the hon. Member for Ceredigion will think hard before he gives away too much to the Government. The reality is that there is a need for a framework; if we are not careful, we will effectively have four different systems of agriculture developing, and I do not think we are very careful. I have waxed lyrical already about the problems in Northern Ireland, which have become more acute after yesterday. The Democratic Unionist party has already told me that it is not necessarily going to follow this particular bit of legislation—at the moment, it is not even going to follow this Government, so watch this space.

We must be very careful that there is some degree of co-ordination—dare I say it, a single market—within the United Kingdom, let alone a relationship with the Republic of Ireland, which is crucial for them but also important for us. We think the hon. Gentleman’s new clause deserves debate, and maybe more than debate. We must secure this agreement. It is interesting that the Fisheries Bill provides powers for Welsh Ministers, Northern Ireland Departments and Scottish Ministers in a more formal sense, yet this Agriculture Bill does not. Why not? I ask the Minister that—he can intervene, or sum up accordingly.

This is not just about farming. The new clause is strongly supported by Greener UK, which feels strongly that there is a real need for cross-border co-operation and collaboration to deliver on the environmental protection improvements that the Bill is all about. The Opposition advocated that during debate on the European Union (Withdrawal) Bill, because we feel strongly that there is a need to at least keep the four countries together in terms of the different provision. Unless that is done by consensus, it will have to be done by imposition; consensus is by far the better way.

The specific requirements set out in new clause 11 would provide those legislative safeguards. Otherwise, there is nothing in the Bill to make the issue something substantive—rather, it is just on a wing and a prayer: one of the criticisms we have advanced throughout this Committee. I hear what the Minister says about how the different conventions apply with regard to meetings with the other three countries. This is very much an England-only Bill, so of course the Government can say warm words and make gestures, but those will not necessarily be tied in by the Bill.

On the need for environmental collaboration, Greener UK’s view is that the new clause is important, because those environmental considerations do not respect national borders. Unless we do similar things—we will not do the same thing, but we might do similar things—agriculture will be not just devolved but different in each of the four countries, as I have said.

--- Later in debate ---

[Dr Drew]

My hon. Friend is absolutely right—of course they will. There is a real danger that something akin to turf wars will develop. This is not just hypothetical; it is about the need for common frameworks because of issues such as soil erosion and water management. We have to have cognisance of the fact that border areas need to take account of one another and of what is happening. Otherwise, we will end up with a race to the bottom, which we all want to avoid.

Another issue that has not been raised yet is the way that we will meet our international obligations post Brexit. As much as we have devolved Administrations, as the hon. Member for Edinburgh North and Leith rightly says, we have signed up to many international conventions as the United Kingdom. We need some method. I hear what the Minister says about how regularly Ministers meet from the four Administrations—well, three; I do not know whether officials from Northern Ireland were there—

[George Eustice]

indicated assent.

[Dr Drew]

The Minister nods, so they were. Again, that is important because it will be a learning curve.

[George Eustice]

The hon. Gentleman is right to say we have international commitments, not the least of which, relevant to agriculture, is to the World Trade Organisation. I was somewhat surprised, therefore, that he decided not to vote with us on establishing the clauses that would enable us to deliver those commitments.

[Dr Drew]

It is not surprising. We are the Opposition and you are the Government. The Government are supposed to be moving the measure, which we scrutinise. There are ways in which we scrutinise it, which might involve some reflection.

[George Eustice]

And we did, but I suppose the point I am making is that there are elements of the Bill that enable us to deliver the UK’s international commitments.

The hon. Gentleman asked whether I wanted to intervene on fisheries, and he is right that there are two areas in the Fisheries Bill where provision is made for joint working, but the difference with that Bill, which we will have time to debate in the future, is that it is very much to do with international negotiations. That is why we have committed to having a joint fisheries statement. It is all about international environmental commitments that are UK-wide. Secondly, there is provision for joined-up thinking when it comes to joint licensing, which, again, relates to an international agreement. We see agriculture policy as slightly different. There needs to be more scope for the devolved Administrations to do what works for their own landscape.

[Dr Drew]

I thank the Minister for that, and it is a perfectly valid case to make. That would be fine if we did not have a common border with another country that is going to remain in the EU. I do not quite understand. Although the seas are different in the sense that, yes, of course, there is a question of international access across all our waters, we have the same issue, whether we call it the backstop or just the border between Northern Ireland and the Republic. We have to face up to it and look at some commonality, which is best achieved by common frameworks.

--- Later in debate ---

[Dr Drew]

Will the Minister tell me what the former Secretary of State, the right hon. Member for North Shropshire (Mr Paterson), was doing in Oklahoma, if not trying to talk about some trade deal? If he cannot pull it off in this country, let alone the US, what was he doing in Oklahoma?

[George Eustice]

I did not know that my right hon. Friend was in Oklahoma, but he is no longer the Secretary of State, and I have not had time to go to Oklahoma personally.

Smaller countries such as New Zealand and Australia have less parliamentary scrutiny—it is predominantly a prerogative for the Cabinet—but even Australia has a process whereby the final trade deal must be laid before Parliament for a period of 15 days. For us, this is an area led by the Department for International Trade. The hon. Member for Stroud said there were a number of amendments to the Trade Bill, which I know were debated. DIT has taken a position somewhere between the two. It envisages a 14-week consultation to run ahead of any new negotiation. There would then be a strategic trade advisory group, created to advise Ministers. As negotiations progressed there would be regular updates and statements with the International Trade Committee, so there would be a committee of MPs scrutinising the progress of negotiations. Finally, at the end of the negotiation, the terms of the Constitutional Reform and Governance Act 2010 would kick in. That would require the Government to lay the trade deal and the treaty that established it before Parliament. There would then be a period of 21 days during which Parliament could pray against that trade Bill and vote to refuse its ratification.

If that happened, the Government would have to go away and think again about what to do. If that process continued a number of times, it would obviously be possible to bring a motion before Parliament that would effectively veto the treaty. There would be lots of scrutiny during the development of the trade deals and then a parliamentary right to veto at the end.

Agriculture Bill (Twelfth sitting)

Debate between George Eustice and David Drew

Thursday 15th November 2018 Public Bill Committees

[George Eustice]

Agriculture is devolved; we do not dispute that. That is why there are schedules for some parts of the UK that have asked us to do that, and it is open to other devolved Administrations, including Scotland, to bring forward their own domestic legislation on agriculture. However, demonstrating compliance with an international obligation through the WTO is a reserved matter. We do not dispute at all that agriculture is devolved—that premise runs right through the core of this Bill—but this is about demonstrating compliance with an international obligation.

Turning to the point that the hon. Member for East Lothian made about whether we could have a better way, as I said, we do not have a federal model. This system is one that we use a lot, through things such as the joint ministerial committees. Next month, hopefully, I will go the December council to discuss fisheries. When I do that, Ministers from all the devolved Administrations will join me in the trilateral with the EU presidency and the Commission. We work through our differences and work together on particular issues, but in the final analysis if there is a dispute about a priority or we have to make a judgment call about whether to support a final agreement, it is for the UK to make that final decision. That is right because it is an international negotiation.

Amendment 119 would make a similar provision on defending the devolved settlement. As I said, we are clear that the powers we outline in clause 26(1) are fully reserved—they do not encroach on any of the devolution settlement at all. Therefore, there is no need to restate some of these matters.

The hon. Member for Stroud asked what will happen when we lay our WTO schedule. We have already laid our proposals for that. We have been in a long discussion with the European Union. The plan is to split the WTO schedule both on tariff rate quotas and on the aggregate measurement of support—the so-called amber box. It has already been decided that it will be split using a method based on historical use or an appropriate allocation of the size of our agriculture. That schedule has already been logged with the WTO in draft form. We are currently going through what are called article 28 discussions with some countries about certain issues they have raised. The process is clear: the amber box—the AMS schedule—is split and, as I said, we get around £3.5 billion of that. We are already going through the process of laying that, with the agreement of the EU.

[Dr Drew]

I must dredge my memory to recall what the different coloured boxes are. What the Minister has said is fine, as long as there is agreement in the four territorial Administrations on what the Westminster Government intend to offer them. What happens if there is no agreement? Will they make representations, perhaps directly to the WTO, to say that the allocation is unfair?

[George Eustice]

It would not be their position to make a representation to the WTO, because it is a UK schedule. As I said, in clause 26(2) we set out a process for agreeing an allocation of the amber box—the aggregate measurement of support—and we set out a disputes process. On classification, there is also some confusion, and we will come on to bits of that later. A lot of the support, such as the coupled support that takes place in Scotland, is not even amber box; it currently comes under what is called blue box, which is a departure from the traffic light analogy.

In WTO rules there is a red box, which means that something is banned and cannot be used at all; a green box, which is for the agri-environment-type schemes; an amber box, which is for anything that might be trade-distorting; and, finally, blue box, for anything that may have some trade impact, but that is not the primary objective, and that does not distort in a large way. Scotland’s coupled support on beef and sheep currently fits within blue box, so it does not even use up any of the amber box allocation. The types of support that use up amber box allocations might be some of the intervention powers, particularly market intervention, which involve buying up surplus products and placing them in storage. That type of intervention is what we mean by amber box.

Some of the concerns that NFU Scotland has expressed are partly founded on a misconception about where its current coupled support schemes sit in the WTO schedules.

--- Later in debate ---

[George Eustice]

These are interesting amendments. It is more around the interpretation of the clause, and I want to reassure hon. Members that there is not some secret plan to start setting limits where they are not appropriate. The real purpose of subsection (4)(b) is to enable us to set limits in future: it is really a future-proofing clause. If at some point in the future the WTO placed limits on blue box or green box, on which there are no limits now, it would enable us to set limits for those other classes in that future scenario.

To be clear about the definitions here, when we talk about classes of support, we do not mean a particular type of coupled payment or a severely disadvantaged payment. We actually mean blue box, amber box or green box. We mean classes of support in the context of the WTO definitions of classes of support. We are not in the business of saying people cannot have that headage payment or this headage payment. We are simply saying that we could set limits on those other classes should, at a future date, the WTO rules evolve to the point that they have those.

I hope I have reassured the Committee that there is nothing beyond that. To be clear, if we were to set a limit on the use of blue box at the moment, using the power in subsection (4)(b), that would be illegal, because it would breach subsection (1), which is absolutely clear on the purpose. The purpose is for

“securing compliance…with the Agreement on Agriculture.”

If there is no limit on blue box spending in the agreement on agriculture—and there is not at the moment—then there would be no limit on the amount of blue box that a devolved Administration could spend and there would be no way, even using that clause, for the UK Government to place such an arbitrary limit that went above and beyond the agreement on agriculture. I hope I can reassure the hon. Member for Stroud of our intention. This is largely a technical, future-proofing clause to take account of the fact that there may be an evolution in WTO rules.

As the hon. Gentleman was talking, I looked at subsection (9) to see whether there was clarity about the definition. Before Report, I will look at whether it might be appropriate in that subsection, which is around definitions, to be clearer about what we mean by “class of support”. We define what “domestic support” means, but “class of support” could be misinterpreted. I will talk to our lawyers and parliamentary counsel on that technical matter to see whether there is a need for that clarity to be given and come back to the House on that matter on Report. I hope, having made that offer, the hon. Gentleman might not press these two amendments.

[Dr Drew]

I suppose half a loaf is better than none, given that we are talking about food. I welcome that latter compromise. It is good to know that the Government are willing to compromise where we think an improvement could be made.

I am a wee bit worried about the way that the devolution settlements are going to be somewhat altered, in terms of the way in which the WTO application will need to be visited quite carefully. Who can tell what the future will bring in terms of the box arrangements, whether it is the blue, amber, green or red box? The problem with it is that, in a sense, we can only pass legislation today but the Minister is trying to pre-empt what might happen in the future. I am worried about this and I urge him, having offered us half a loaf, at least to look at whether we can define this in terms of what the devolution settlements say. I think there is the possibility, as the NFUS says, of some future dispute if the territorial Administrations decide on different levels of spending on their agriculture. Clearly, they cannot be outwith any WTO arrangement, because they will be subject to the penalty clauses that the WTO brings forward in due course. However, we know that takes years, so a difficult situation may arise whereby we have tension between the different Administrations with responsibility for agriculture yet we are trying to devise a settlement that fixes amounts for them all.

I will not press amendments 120 or 121 to a vote. We think we have got somewhere on amendment 121—the Minister will look at subsection (9) to see whether classes of support can be better defined, and we look forward to seeing the outcome of that. However, I urge him to look at how the arrangement will work and at least take cognisance of the legal judgment that the NFUS received, because this is an area of possible conflict. I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Amendment proposed: 69, in clause 26, page 21, line 26, leave out subsection (6).—(Deidre Brock.)

This amendment would remove the requirement to provide information to the Secretary of State.

Question put, That the amendment be made.

--- Later in debate ---

[George Eustice]

We have discussed this issue in detail, so I do not intend to say much. Clause 26 is all about the UK Government’s being able to fulfil our obligations under international law—to demonstrate compliance with WTO rules and demonstrate that we abide by the limits set out in our WTO schedule. I shall not repeat our detailed debate on the amendments.

[Dr Drew]

I do not intend to delay the Committee for long, either, but the clause is important and detailed. I accept that the Minister is prepared to make improvements to subsection (9), which we welcome.

Again, the clause in a sense pre-empts what may happen after March. It is important that we know what elephant traps there may be if we do not get this right. We have concentrated on the impact on the territorial Administrations, but there is a wider impact. The Minister may choose to intervene to give us some idea of the timescale of the WTO application. Understandably, the Government have already put in a draft schedule, but it would be interesting to know for what period we will be without any protection. We will be outside the EU, although we will be in a transitionary period—presumably that transitionary arrangement will cover us. It would be interesting to know whether we have got to have the WTO application accepted when the transitional arrangement with the EU comes to an end. The Minister might care to intervene on me to tell me that, because I personally do not know—[Interruption.] Or not, as the case may be. I will leave that as a question for some future date.

It is important that we know what that arrangement is, because we could be outwith any protection. Food is a pretty important area, and all sorts of substandard food could come in—dare I say it?—legally, so we want protection. The Minister has heard that and perhaps needs to think about it a bit. We need to know the timescales; otherwise we will return to this issue on Report with an amendment to ask the Government to explain what the timescales could be, and what happens if we do not get them right.

[George Eustice]

As I said earlier, we have already got an agreement with the EU—we have been working with it for well over 12 months—on splitting the EU schedule. There will be a UK schedule setting out all our agricultural tariff rate quotas—TRQs—and our share of the amber box. That has already been laid with the WTO and is now going through what is called an article 28 process, in which there are technical-level discussions with other members of the WTO who might have questions. Once it is laid, it is laid, and it does not have to be certified to take effect. Whether or not it is certified and agreed by every member of the WTO is largely inconsequential. It is the schedule that we will work to from the end of March 2019 in the event of a no-deal Brexit. If there is an agreement and an implementation period, we would continue to work within the EU framework.

[Dr Drew]

I ask that not because it is hypothetical. I understand that Australia and New Zealand already have complaints in the WTO about sheep. The Minister is nodding.

[George Eustice]

Yes, of course. The WTO is not a supranational institution like the EU, in which there are infraction proceedings; it is a dispute-resolution process, and is often used by certain countries to try to secure advantages. Typically, when the EU has an accession country coming in—when we have had EU enlargements—the amended schedule that it tables can sit unagreed and uncertified for about a decade, but it is still worked to. The WTO works at an even slower pace than the European Union, but because it is a looser framework—effectively, a dispute-resolution process—there is plenty of latitude for us to lay our schedule and work towards it for as many years as it takes before people finally sign it off and agree it.

[Dr Drew]

I thank the Minister for that; that is very useful. It is just a strange world if we have already had a complaint before we have joined. They are getting their retaliation in first. These issues matter. Sheep will be an important variable if we leave the EU the way we could do, because we would be subject to the end of New Zealand’s quota arrangement. Australia, in particular, will want to send a lot more sheep into this country, because it thinks it can do it cheaper and better. That has a huge implication for Wales and Northern Ireland, although perhaps less so for Scotland. These issues matter, and we need to know what the full implications are.

I do not have anything more to add, other than—dare I say it?—caveat emptor. We need to be aware that what is potentially coming is quite complicated, and that we have got to keep lots of balls in the air, particularly for the devolved Administrations, which could lose out if we are not careful in how we draft the completed application to the WTO.

--- Later in debate ---

[George Eustice]

This set of amendments, like previous ones, is largely about correcting drafting errors or making technical changes to reflect issues that we identified throughout the passage of the main part of the Bill.

Amendments 29 and 30 provide DAERA with powers to modify voluntary redistributive payments and areas of natural constraint payments, neither of which are currently made in Northern Ireland. Amendments 31, 32 and 38 define retained direct EU legislation related to the coupled support scheme and provide the option to continue and simplify or improve that scheme. That scheme is also not currently used in Northern Ireland, but the amendments ensure that a future Minister is not restricted on their choice of policy scheme.

Amendment 35 makes it clear that changes to basic payments—to improve or simplify—can include the continuation of taking steps towards reaching a flat rate of payment. Amendment 37 ensures that DAERA can continue direct payments after 2020 by enabling it to set ceilings after that scheme year. Amendment 36 allows DAERA to reduce the direct payments ceiling by up to 15% for Northern Ireland in 2020. Northern Ireland at the moment does not modulate at all between pillars 1 and 2.

All those amendments have been requested by DAERA because many of the policies are not ones that are used now—they are options in the CAP that have not been taken up under the Northern Ireland schemes. DAERA believes the powers to be permissive and that it is important for it to retain the option should a new Northern Ireland Administration be formed and decide that they want to take up those options. This is a sensible set of amendments to ensure that a future Administration in Northern Ireland will have the powers to pursue their policy choices.

[Dr Drew]

I will speak to the amendments, although my comments will relate more directly to schedule 4 generally. I might as well put the two together.

I do not have any particular problems with the Government amendments as such. They are just tidying-up amendments. However, as I have on previous occasions, I will raise at least an amber flag—we are still on boxes—about the situation in Northern Ireland. There are two aspects. First, Northern Ireland has no Administration, so the schedule has been agreed not with elected politicians but with DAERA itself—the officials. That might be because we have to face up to the fact that there is no Administration, but that poses the question of what will happen if and when there is an Administration. They will inevitably want to revisit the schedule, because they will want some political input.

Secondly, Northern Ireland is clearly different. This morning, people have spent rather a long time trying to prove the point that Northern Ireland is different—it has our one land border with an EU country, the Republic. Therefore, whatever we do in the Agriculture Bill is contingent on what that relationship entails. I have talked before about Baileys liqueur. The milk used in it crosses the border seven times. Joe Healy, the president of the Irish Farmers’ Association, kindly told me that interesting fact—it is good for pub quizzes. There are all manner of other movements, such as southern pigs being slaughtered in northern abattoirs, or northern lambs being slaughtered and sold in the south. Such movements of animals and goods are integral to the way in which trade across the whole of that island has evolved since the Good Friday peace agreement, and given that we are both members of the EU and so have not had any borders.

I know—as the Minister will no doubt confirm—that there are absolutely no plans at all to put in a physical border. That is the reality of the situation. If there are to be such plans, they will have to made very quickly, because DAERA has confirmed that it has no plans to put in a physical border. The best that it could come up with at this short notice is more inspections, wherever they might take place.

I am asking the Minister what clarity there is about passing a schedule that has no political input because, sadly, there is no Administration in Belfast. What are the safeguards regarding whatever comes out of today’s EU agreement? Many of us would actually describe it as a non-agreement, because it is highly unlikely that this House will agree to the Prime Minister’s proposals—but that is speculation and for the future. More particularly, we must look at how to address the possibility of no agreement or an agreement that threatens the current freedom of movement between Northern Ireland and the Republic.

--- Later in debate ---

[George Eustice]

We already have an organisation called the UK co-ordinating body, which is hosted by the Rural Payments Agency and works in collaboration with all the devolved Administrations on auditing and accounting issues under those EU schemes. We envisage that a body such as that would continue anyway, but there are already established principles in place within the UK civil service. It is important to recognise that, while we have different devolved Administrations, we have one civil service for the entire UK; civil servants working in the Scottish Government are as likely to get a transfer to work in a Whitehall Department as anywhere else. We have a single civil service, which is important to give some cohesion to our system.

I conclude by saying that this is an important schedule to include. In my view, DAERA has taken the correct approach of ensuring that it can continue to make payments to its farmers, while putting some powers in place for a future Administration. The answer to the shadow Minister’s question is that, when there is another Administration, if they have bolder ambitions to change and transform their policy in the way we have outlined in clause 1 and that Wales has chosen to adopt on an interim basis, it will be open to them to introduce legislation through the Northern Ireland Assembly to give effect to their specific proposals.

[Dr Drew]

The Minister has been very candid there in saying that, effectively, Northern Ireland stays as it is at the moment. That would be fine if we knew an Administration were coming in before the transition arrangements for our own relationship with the EU come to an end, but potentially—in the worst-case scenario—there will be no Administration in Belfast for a considerable period. That would mean the agricultural system staying in place for as long as there was no Administration. We have, as I have always feared, an increasing focus on England as the basis of this Bill. Scotland does not have a schedule and will do its own thing; Wales will follow England, but may choose to do so in quite a slow manner; and Northern Ireland will stay the same until politicians decide to pick up the mantle again.

While the direction of travel toward environmental support is quite right, it is a bit worrying as we have a single market within the United Kingdom: if we are subsidising sheep farmers in Northern Ireland by direct payments, sheep farmers in Cumbria, who will not be receiving that support, will begin to worry. I know the argument is that they can pick up support.

[George Eustice]

I understand the point the hon. Gentleman is making, but he has to understand a number of points here. First, the basic payment scheme single farm payment is already de-linked from production. Nobody has to produce anything on the land to qualify for that payment. It is a de-linked payment—a subsidy for owning or controlling land.

Secondly, the hon. Gentleman must recognise that in our provisions for England we have set out a transition period that will run for seven years and it is our intention gradually to phase down the direct payments. That will not be an overnight change, but a gradual divergence. I hope that at some point within that seven-year transition period we will at least see a new Administration in Northern Ireland, because in the absence of such an Administration we will have many more problems besides the fact that they have not been able to update their agricultural policy.

Finally, in the context of Northern Ireland specifically, it might well be the case that a future Administration choose to keep a closer eye than will other parts of the UK on future policy in the Republic of Ireland through the common agricultural policy, for the very reasons the hon. Gentleman pointed out: Northern Ireland shares a land border with the Republic of Ireland and there is a lot of transfer of goods across that border. Therefore, ensuring that there is some recognition of the type of farm support in the Irish Republic is more important for farmers in Northern Ireland than for those in other parts of the UK.

[Dr Drew]

Again, I find that very instructive, and I do not disagree with anything the Minister says, but this is more and more a curate’s egg. The problem is that we are dependent upon an Administration being in place—at some time—who will follow where we are going in England; otherwise, there will be issues of conflict.

The Minister is right that payment is de-linked, but not to the extent that farmers in Northern Ireland will receive basic payments for whatever we choose, or whatever they choose, or whatever DAERA chooses, or whether that is—in a sense—a form of direct rule. We could impose them, but that would go back to the fact that, effectively, there was an imposition on a part of the United Kingdom by the UK Government into a territorial Administration. It opens up a whole can of worms in that respect.

--- Later in debate ---

[Dr Drew]

It is good to see how cross-party collaboration can have an impact. I congratulate Conservative Members on getting the Minister to move—it is important. I am not an expert on this part of the Bill; we do not have that much beef farming in my part of the world, but some dairy cows get slaughtered and it is important that we know the impact of the levy boards. I am interested in what happens in Northern Ireland, which is not part of the scheme. Can they be brought in?

I am interested to know to what extent the separate boards—the Agriculture and Horticulture Development Board, Hybu Cig Cymru operating in Wales and Quality Meat Scotland—will maintain their independence, given that the Bill, which is primary legislation, is making a change to how the moneys will be devolved. It would be useful to know to what extent the different organisations will maintain complete independence or whether the administration of the funding will become more complex. I suppose the AHDB would take over all responsibility and devolve the moneys down to the different organisations.

It is good. This is what primary legislation is for: to improve what we have at the moment and do it differently and better. It is pleasing that it seems that all the farming organisations are in favour of the proposal, so I cannot see any reason why the Opposition would not be in favour of it. Again, I would like some clarity about exactly how the scheme operates at the moment and the changes that are, hopefully, going to make it better. We support what is proposed and hope that this good bit of the Bill will receive unanimous support at every level of debate, both in this place and the other place.

[George Eustice]

It is great to have an outbreak of consensus on this issue. I will address some of the points raised, first by the hon. Member for Edinburgh North and Leith. New clause 30(2) addresses all her concerns because it makes provision in paragraphs (c), (d) and (e) for:

“when a payment is to be made”,

so it is clear the scheme can design that;

“how a payment is to be made,”

and

“the duration of the scheme”.

We envisage that an assessment may be made of the type of animal movements, based on the cattle movement records, and then a scheme could be set that might run for a year, two years—a number of years—to reflect those cattle movements; and a scheme could be put in place that enabled the transfers. It is very clear that the scheme that would be designed would provide for those particular issues.

On the points that the shadow Minister made, the boards would retain their independence. This is where I take some issue with the hon. Member for Edinburgh North and Leith. It has not taken 13 years to sort out. We must recognise what happened. The previous Labour Government, with very good intentions and at the request of the devolved Administrations, gave the devolved Administrations the power to collect their own levy, because that is what they said they wanted at the time. Two or three years after that, when a number of abattoirs in Wales and Scotland had closed, the industry there started to say, “This change now disadvantages us because we are not getting a fair share of the levy that is collected.”

To be fair to the previous Labour Administration and my predecessors from some years ago, they were reacting and responding to requests from the devolved Administrations at the time. For reasons of closures of abattoirs, that did not work out and this slight problem was left and has run for a number of years. We have consulted on a possible long-term solution through a different collection methodology, potentially to do with ear tags, but we concede that a fix of this sort, which would enable us legislatively to move money around with the agreement of all the relevant devolved Administrations, is the right power to put in place.

Amendment 42 agreed to.

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

--- Later in debate ---

[Dr Drew]

I beg to move, That the clause be read a Second time.

We will get active again now, having had a thorough but rapid run through some parts of the Bill. New clauses often deal not with what is going to be in the Bill but with what should be in it. We make no apology for saying that this should be a comprehensive Bill that looks at some of the big issues of our day.

There is nothing more important than the relationship between agriculture and our international obligations, so I make no apology for tabling new clause 8. Of course we want the Government to say that everything in the new clause will be in the forthcoming environment Bill—provided there is a Government and an environment Bill—but we thought we would test the water to see whether there were ways in which this Bill could at least take cognisance of those vital international obligations.

Let us look at our proposed changes, which are all vital in their own way. We are asking that the Bill take notice of what the different vital international obligations require us to do. In so doing, as subsection (3) says, there should be a duty to consult the relevant authorities in Scotland, Wales and Northern Ireland. That is important because it is putting some building around the scaffold, to use the analogy that has been applied to the Bill several times. The Bill is quite limited in what it seeks to do, so we are asking the Minister to go further.

The new clause requires a report. It does not require huge changes in legislation, but some cohesion in the way in which the Government approach how they intend to use the Bill. I hope that it is not seen to be outwith what the Bill is about but that it is helpful, because it will allow the Secretary of State, or whoever is required to do it, to bring forward a report on how those international obligations are met through the Bill. At the moment, of course, we are part of the EU, so that will take place automatically through some of the ways in which the EU meets its international obligations, but we are presupposing that the UK will not be part of the EU. Brexit means that we need to put into domestic law what was previously implied through our membership of the European Union.

I will immediately sit down and not go any further if the Minister tells me that this will all be in the environment Bill, so the new clause is premature and the issue does not need to be spoken about at length now. Unless we get that assurance, however, we will press the new clause, because we think it is important to signal how British agriculture and the environmental support systems that we are putting in place will operate through the different international obligations to which we are party. If the Minister cannot confirm that, one wonders what we will do to meet our international obligations and targets in the future.

I will not go into any detail about the individual agreements, but clearly the Paris agreement is vital to our commitment to tackle climate change. We tried to get the Government to accept amendment 50, and if they had, the new clause would probably not have been necessary. Sadly, they did not listen to us and we lost the vote on that amendment. In moving this new clause, we make it clear that the Paris agreement is crucial in terms of how the Bill should meet that commitment.

We do not have a good story to tell. Agricultural emissions have flatlined in recent years—there has been no improvement—and we have a major problem with methane and carbon, so we have to do much more. The new clause implies that agriculture must do more, as the 2018 IPCC report said. It is not just that producers have to do more; we should lay down some clear guidelines for consumers about sustainable diets that include what we should eat rather than what we do eat. There should be guidelines about reducing food waste, soil sequestration, livestock and manure management, reducing deforestation, afforestation, reforestation and responsible sourcing. They are all part of what the IPCC is asking us to do.

In the new clause we are bringing forward an important piece of potential legislation—we would all sign up to sustainable development, but we want to do so in the Bill. We ask the Government to recognise that including those obligations is appropriate. If not, we want assurances from the Minister that the environment Bill will include them. If the Government intend to include those obligations in the environment Bill, let us put on record here that including them at this juncture, in the Agriculture Bill, is less important.

The Government need to recognise how important those different obligations are and explain how we are meeting them. I have only identified a small number, but those are, to my mind, the most relevant to agriculture, and the ones that really matter to ensure that our agriculture meets its international obligations. I hope that the Minister has listened to what I have said, because it is not just in the interests of people on this side of the House. My hon. Friend the Member for Bristol East raised this matter in an earlier sitting of the Committee, and it is supported across the board by Greener UK, which feels strongly that we should be setting longer term objectives—that is why the new clause is popular. We hope that, in due course, it will stand part of the Bill, or that its aims will be clearly spelled out in future Government legislation—namely, the environment Bill.

We have read how the 25-year environment plan will contextualise what the Government intend to do and it contextualises the Bill. It would be good to hear what the Government and the Minister intend to do to ensure that those warm words are put into a statutory framework, so that we know exactly what the UK will do when—or if—it leaves the European Union, and know that we are signed up to a better environmental world and one that agriculture plays its part in creating.

[George Eustice]

The Government take our international obligations very seriously. The list of international conventions and forums to which we are a signatory is long. I will not fob the hon. Gentleman off by saying that the obligations will be included in the environment Bill. I can go one better: we already produce many reports under all of those conventions.

I have often said, in the context of calls for statutory requirements for consultations, that DEFRA loves consultations, so there is no need for a statutory requirement. I can also confirm that in my time as a Minister, I have discovered that DEFRA loves annual reports as well. Indeed, I often say to officials, “Am I the only one who reads this report?”. Given that the hon. Gentleman said that we should be publishing reports, he clearly does not read some of those that already get published, so I will cover some of them now.

There are already reporting requirements under decision 24/CP.19 and decision 2/CP.17 of the UN framework convention on climate change; under article 26 of the convention on biological diversity; under article 33 of the Cartagena protocol on biosafety; and under article 8, paragraphs 6 to 8, of the convention on international trade in endangered species. Under the Paris agreement and the Climate Change Act 2008, an annual statement of emissions is provided to Parliament. Every five years we provide a similar statement to Parliament stating the final performance under a given carbon budget.

--- Later in debate ---

[George Eustice]

The hon. Lady makes a legitimate point. That is one example where there is not a requirement within the convention or commitment to publish, but we pick up those obligations through the departmental plans.

The other area that we do not currently have a specific provision for is the United Nations convention on the law of the sea. I can tell the hon. Member for Stroud that the Fisheries Bill commits us in clause 1—I will not go too far down this point, because it is a separate Bill, which we have to look forward to—to a whole set of sustainability objectives and a joint fisheries statement to outline how we will deliver those objectives. The environmental objectives under UNCLOS will be picked up through the provisions in the forthcoming Fisheries Bill.

I hope that I have been able to reassure the hon. Gentleman that we take these conventions seriously, that we already have a multitude of requirements to report through articles within the conventions themselves and, therefore, that the new clause is unnecessary.

[Dr Drew]

I thank the Minister for giving us a long list by way of explanation. This was more of a probing amendment, but we want to put it on the record that one of the difficulties with legislation is the degree to which it needs to be bound into other legislation. I think that this proposal is probably more appropriate for the environment Bill, but again, we need to put it on the record that the Government should be saying how they will meet their international obligations, not only through reports, but through the way in which they meet those obligations, which can then be manifest in the reports.

Sadly, the IPCC stated categorically—and I was there when Lord Deben, who was John Gummer, told me and a very big audience—that agriculture emissions were flatlining. Something somewhere is going wrong. International obligations are not being met; there should be a decrease. As it is, the only sector where there has been a significant decrease in the use of carbon is energy. Manufacturing, agriculture and the service economy are all flatlining. They are not reducing their dependence on carbon.

It is disappointing that we must bring the matter up, but bring it up we do. I shall accept what the Minister says at this stage, but I hope that he will listen to us and that when the environment Bill comes along there will be a clause on agriculture. In the 25-year environment plan there are quite a number of references to agriculture, as is right and proper, given that it is the most important user of the landscape. We want joined-up thinking and joined-up action.

We also want to know that the Government are dealing with areas in which, so far, they do not have a good record—I mean not just the present Government but predecessor Governments. They have simply failed on emissions standards. The Climate Change Act was only passed in 2008, so that is an easy cop-out for the previous Labour Government, but the reality is that we have not met our international obligations on agricultural emissions. I hope that the Government will do something more—they have to.

From talking to various people in Northern Ireland, I gather there is a huge problem with methane there, partly because of the growth of factory farming. That may or may not be acceptable—certainly to me it is not, but to some people it is. The downside is that methane emissions are growing rapidly. The Republic admits that it has a problem, although less than the north. We must recognise that change in agricultural systems is not always good; there can be a downside for the environment.

I shall not press new clause 8 to a vote, Members will be pleased to hear, but I hope that the Government will consider what has been said in this mini-debate, and think about how to make sure there is a strong component in the forthcoming Bill to reflect the role of agriculture. I beg to ask leave to withdraw the clause.

Clause, by leave, withdrawn.

New Clause 9

Reports on impact on consumers

‘(1) The Secretary of State shall lay before both Houses of Parliament reports on the impact of the provisions of this Act on—

(a) the availability in England of agricultural products produced within the United Kingdom,

(b) the cost to the consumer in England of agricultural products produced within the United Kingdom, and

(c) the health and welfare of consumers in England.

(2) The first report under subsection (1) shall be laid no later than 31 March 2020, and subsequent reports shall be laid no later than 31 March in each calendar year.

(3) “Agricultural product”, for the purposes of this section, means a product that falls within a sector listed in Part 2 of Schedule 1.’ —(Dr Drew.)

This new clause would require the Secretary of State to report annually on the impact of the Bill’s provisions on food security, availability and affordability, and the impact on consumer health and welfare.

Brought up, and read the First time.

--- Later in debate ---

[George Eustice]

The hon. Gentleman highlights some important issues with the new clause but, as with new clause 8, I want to take this opportunity to explain to him the number of reports that we already produce. As I said earlier, DEFRA loves reports, and already collects a significant amount of information that is relevant to the availability of food and agricultural products.

For instance, our “Agriculture in the United Kingdom” report covers details of production volumes, production-to-supply ratios, and the origins of domestic consumption. The “Food Statistics Pocketbook” covers the economic, social and environmental aspects of the food that we eat; the data specifically track the origins of the food consumed in the UK. Regarding the cost of home-produced agricultural products, our family food survey has been running for over 75 years. It produces annual estimates of purchases by people in the UK and tracks food prices in the UK in real terms, including for products such as dairy, fruit, vegetables and meat. In addition, the FSA runs a survey on people’s food experiences, in particular whether they are finding it difficult to afford food.

Separately, we assess consumer attitudes to British food. For example, when surveyed, 60% of shoppers agree that they try to buy British food whenever they can. Next, we have DEFRA’s UK food security assessment, which is a regular assessment that takes place roughly every four to five years. It also analyses all aspects of food security, including production-to-supply ratios, resilience in the supply chain, affordability issues and consumer confidence.

It would be difficult to measure the specific impact of agriculture policy on the health and welfare of consumers, because many different factors drive people’s health outcomes and their relationship with food. However, other Departments already address that area. For instance, we already report on the overall health and welfare of consumers through Public Health England’s national diet and nutrition survey and the reports of its Scientific Advisory Committee on Nutrition. There is a plethora of existing reports, published predominantly by DEFRA but also by Public Health England, addressing all of the issues identified in the proposed new clause.

However, I understand that the sentiment underlying the proposed new clause, and the reports that the hon. Member for Stroud is requesting, is that there is not enough about food in the Bill. We have heard representations of a similar nature from Conservative Members, and as the hon. Gentleman pointed out, similar representations were also made on Second Reading. I can tell the hon. Gentleman that we are giving a bit of thought to how we might address that concern during later stages of the Bill. I am sure that hon. Members who feel that there is not enough about food in the Bill—even though, as I have stated many times, I disagree—will welcome the fact that we have taken note of some of the points that have been raised.

[Dr Drew]

Progress! We are being listened to. I welcome what the Minister has said. Again, this is not something that we have just cooked up—excuse the pun. [Interruption.] I have to keep Members awake somehow. Food is pretty important to an agriculture Bill. I do not know whether the Minister wants to tell me how he will address this concern; I hope it is on Report, not in the House of Lords, because it drives me mad when the Lords get all the credit for these wonderful improvements, even though we have worked blooming hard on the Committee. We get turned over regularly, and the Lords get a wonderful improvement in how food is dealt with in the wording of the Bill. It is important that we persuade people that, through the Bill, there has been a change for the better. If food is in the Bill, the Opposition will be much happier—and I will just hint to the Minister that we would like a bit of a mention of health as well. The link between the nature of the production process and food and health is so important.

I was going to press the proposed new clause to a vote, but the Minister has completely dumbfounded me by saying that the Government are going to listen to what the Opposition have been saying for the past couple of weeks. I will not press it to a vote now, but I genuinely hope that the Minister will bring something forward on Report so that we can get some credit, and we will then work with the Government to make sure that the Bill goes through more successfully than it otherwise would have. I beg to ask leave to withdraw the clause.

Clause, by leave, withdrawn.

Ordered, That further consideration be now adjourned. —(Iain Stewart.)

Agriculture Bill (Ninth sitting)

Debate between George Eustice and David Drew

Tuesday 13th November 2018 Public Bill Committees

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

I am delighted to be back, Sir Roger. I spent much of last week in Northern Ireland and Ireland, and will no doubt be referring to that in Committee.

A couple of points are important to the clause. We need to understand that the Bill should encompass pillar 2 of the common agricultural policy. I am not sure whether it does, although this is the closest that we get to it. I am aware that in due course we will be debating my amendment 115, so I am not going to talk about timetables.

I want to talk about the substance of rural development: it is very important that we understand that although agriculture is crucial to rural development, it is not the totality of it. I would argue that the Government have not got a rural policy, and they need one. Things are going on in rural England, to which the Bill largely refers, that are not good at the moment. Anyone who has read the material that has come out about the relative decline of market towns should be very clear that we need to invest in those communities and the villages around them.

The worry is that the Government not only do not have a rural policy, but they have no one to speak on a rural policy. They dismissed all rural advocacy. I am not saying that new Labour was wonderful in this area, although we did have a good rural policy between 1999 and 2004—principally around the countryside White Paper of 2000 and what the £1 billion earmarked for rural areas implied. It made a significant difference. Sadly, that has all gone: we have lost the rural tsar and the Commission for Rural Communities. That worries me when it comes to this Bill; I do not know how pillar 2, which largely invested in rural communities through the common agricultural policy, transfers into the Bill.

I will be interested to hear what the Minister says. We are back again to the usual game of powers and duties. The Minister and Secretary of State do not need to do anything. They can make lots of warm noises about rural areas, but the reality is that unless we have vibrant rural areas, we will not have a vibrant farming sector because those are inextricably linked.

It is important that we get clarity from the Government on how pillar 2 is embedded in the Act, to make sure that rural areas are not forgotten. The Agriculture Bill is the nearest we will get to being able to talk about rural areas and their need for investment and support through the nature of farming—obviously, a lot of the people who get the benefit of rural development are farmers or farm businesses along the food chain.

Will the Minister clarify what guarantees there are in respect of pillar 2? It was never perfect, but a lot of the academic and support work that goes into rural areas came through that channel. We all know that that sort of funding is highly questionable at the moment. I hope the Government will make some real statements today about how they intend to fund rural development.

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

I want to begin by addressing the shadow Minister’s over-arching point about rural development and the pillar 2 scheme. I will respond to that specific question, which is not directly relevant to this clause but is picked up in other parts of the Bill.

Pillar 2 and pillar 1 are an EU construct: that distinction will no longer exist, but the policy objectives, currently delivered under pillar 2, will be delivered in the following ways. Clause 1(1) is all about the farmed environment and supporting farmers to farm in a more sustainable way and enhance the environment. The objectives delivered by the current countryside stewardship schemes and the previous entry level stewardship and higher level stewardship schemes, which account for the lion’s share of the funding in pillar 2, will be picked up in clause 1(1).

--- Later in debate ---

[George Eustice]

That was not my point at all, and it was not my right hon. Friend’s point. The point was that we should allow farmers and other landowners to be treated the same as everybody else; apply the principles of justice and rule of law that we have in this country; and not have an arbitrary system of penalties coming from the EU.

To come back to my point about the areas in which we can improve, clause 9 will be an important area for some of our evidence requirements and rules on deadlines and dates; we would be able to show more flexibility. The powers in clause 11 will probably be more modest, but they enable us to sort out some of that unnecessary administration—on the LEADER scheme, in particular. They would enable us, for instance, to vary the length of agreements when we thought that was appropriate, particularly if we wanted to extend and roll forward some of the legacy agreements for a few years.

[Dr Drew]

The problem with the LEADER scheme is that it is pan-European. With exit from the EU, will there be the opportunity to allow institutions in this place, and communities, to indulge themselves in a pan-European sense because of the nature of that rural development? We have always learned from other parts of Europe and they have learned from us. Will that be possible or will this expenditure be very constrained?

[George Eustice]

The LEADER scheme is probably the most devolved of all the EU schemes, in that we literally have local action groups—LAGs, as they are called—which are local committees that appraise individual local projects for small grants. The scheme does not require a pan-European architecture; it has just ended up that way. In fact, those types of local grants, which are often administered or certainly appraised locally, lend themselves to a more national scheme.

[Dr Drew]

I hear what the Minister says, and that will be all right from the UK’s perspective, but we will be dealing with countries that are subject to the CAP and continuing LEADER obligations. Do the Government intend to negotiate with the EU post-March to ensure that those cross-country arrangements can continue? Otherwise we will be precluded. Whatever money we choose to put into a new LEADER, we will not be part of LEADER, so what is the Government’s plan?

[George Eustice]

Our plan is to leave the European Union, which means leaving the common agricultural policy and LEADER, but also putting in place superior schemes that we will design nationally. That is what we intend to do.

--- Later in debate ---

[George Eustice]

I am grateful for the opportunity to clarify our intentions regarding the current schemes—the higher level and the entry level stewardship schemes—and, more importantly, some of the countryside stewardship schemes that are being entered into now. My hon. Friend the Member for Ludlow also spoke about the importance of continuity for existing schemes. I am grateful for the opportunity to clarify that the UK Government have already guaranteed that all pillar 2 agreements signed before 31 December 2020 will be fully funded for their lifetime. Even as we leave the European Union in March, until the end of December 2020 we will honour any agreements entered into before that date.

The amendment is unnecessary, because the current regulations do not in fact set an end date in EU law. Had the EU regulations stipulated a cut-off point for agreements, of course we would have needed to address that in the clause, but they do not. We have agreements that are binding under the public sector grant agreements protocols that we have in government. Effectively, that is akin to contract law: we have entered into public sector grant agreements with agreement holders, and that is legally binding for the duration of those agreements.

The underpinning EU regulations set out only limited circumstances in which we could terminate an agreement. First, and quite reasonably, the agreement can be terminated if there is a massive breach of the agreement—for instance, if the agreement holder is not doing any of the things that they said they would. Secondly, if there is a transfer of land and the agreement does not go with the new owner of the land or they do not agree to abide by the agreement, for similar reasons it is right to discontinue the agreement. Thirdly, an agreement can be terminated early by mutual agreement—that is, if the parties choose to do so. That is important in terms of transition to the new order and the new types of schemes.

To answer the shadow Minister’s question about how we envisage moving from these legacy schemes to the new schemes, it may be that in the later years of some of these schemes, agreement holders opt voluntarily to convert their agreement into one of the new environmental land management agreements. They will not have to do so if they choose not to: the agreement that they have will be legally binding. However, if they were to choose to convert their agreement into an environmental land management scheme and both parties thought that was the right thing to do, we would be able to have that option.

I hope that I have reassured the hon. Gentleman. Although he highlights an important point, our intentions are clearly set out, and we are already bound by the public sector grant agreements. The amendment is therefore unnecessary and I hope that he will withdraw it.

[Dr Drew]

I will not press the amendment to a vote—obviously, that would be nonsensical—but I am worried about the tenor of what the Minister is saying. It is easy to find fault with the existing arrangements, but we have to give people confidence that what they have been doing is right. The biggest hurdle arises when the schemes are coming to an end. No one is going to invest time and money then, so ending the schemes early is quite possible, not because farmers and communities necessarily want them to end early, but because they see no future in them.

We need to give a great deal of encouragement to those who have entered into these schemes. They are more than farming schemes: they are to do with the development of our rural communities. It is vital that the Government get the message that the sooner they say what will replace LEADER in particular—all of us with rural constituencies could hold up LEADER as wonderful practice—the better. The sooner we can get some clarity about what will replace it and the degree to which it will allow flexibility to work with other communities and countries, the better for all concerned. I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Amendment proposed: 80, in clause 11, page 8, line 19, leave out “negative” and insert “affirmative”—(Jenny Chapman.)

Question put, That the amendment be made.

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[George Eustice]

It is a point that we have often heard here, about the powers or the duties. We have set out our commitments and our targets, such as through the quartal 2025 and our waste and resources strategy, and we have the power here to do what is necessary to collect data, so that we can minimise risk in the supply chain. It is there, listed with all the other purposes, so I believe that the hon. Lady’s amendment is unnecessary. It is an inappropriate place to introduce a target. We can have a debate about targets and whether there should be targets of this nature in a future environment Bill, for example, or whether we should continue to work with the quartal commitments. As I said, they have already made solid progress. This particular clause is about the collection of information and I do not think it is the appropriate place to set a target in the way that the hon. Lady has outlined.

I turn to amendment 114, also in the hon. Lady’s name. Again, it links to an earlier discussion we had about the Agricultural Wages Board, which was removed. Fairness of employment contracts is an important issue, but it is dealt with in other ways. We have the national living wage, introduced by this Government. It is currently £7.83 per hour for over-25s and in April next year it is due to rise to £8.21 per hour. The regulations are already set out and are enforced by Her Majesty’s Revenue and Customs, which enforces all the national minimum wage legislation. In addition, we have the Gangmasters and Labour Abuse Authority, which deals with some of the practices that I know the hon. Lady is concerned about, such as modern slavery and abuse in the labour market. We have the GLAA already, which has powers to tackle and investigate that issue.

[Dr Drew]

I understand all that. We can have all sorts of regulations quoted back to us. The simple fact is that we are ploughing fruit and vegetables back into the ground again this year, because of the lack of a suitable seasonal agricultural workers scheme. I know this is slightly different from domestic wage rates, but the reality is that we cannot attract people to work on the land because both the wages and the conditions are not seen to be suitable. That is why the Agricultural Wages Board was so crucial. It was not just about wage setting, but setting the environment. Although I accept that the National Farmers Union always campaigned to get rid of it, many farmers welcomed it, because now they have to set those rates and conditions themselves, subject to the national minimum wage and the national living wage, which is always a difficult process. I hope that the Government will, at some future date, think again about this whole area.

[George Eustice]

The hon. Gentleman has strong views on this. We debated this at an earlier stage of the Committee. Our view is that the Agricultural Wages Board became redundant, first with the introduction of the national minimum wage and then, more importantly, the introduction by this Government of the national living wage, which provides new protections, so the Agricultural Wages Board was no longer required.

--- Later in debate ---

[George Eustice]

In the context of any financial grant or incentive awarded to a farmer under the powers in clause 1, the regulations provided for in clause 3 could stipulate a legal requirement to provide certain information. If farmers enter such incentive schemes, there are already powers in clause 3 to require that information. As for animal welfare in the wider context, that is a regulatory issue that should apply equally to all.

I hope I have been able to reassure the hon. Member for Stroud about the importance I place on animal welfare, but we pick up those policy objectives elsewhere.

[Dr Drew]

I hear exactly what the Minister says, but in a sense he is arguing against himself. Why are we restating health and traceability in the clause? All I am saying is that it would be very neat to put, “health, traceability and welfare of creatures”. Animal welfare is important to both health and traceability; it is the third leg of the stool. I do not understand why that cannot happen.

Welfare may be mentioned elsewhere, but so is animal health. This would reinforce in the legislation that this is a key element within the data collection process, which is what this bit of the Bill is about. More particularly, it is about the way we intend the new farming regime to make animal welfare an important part of how farmers should operate, in terms of animal health and traceability.

[George Eustice]

I can clarify precisely why there is a difference. It comes back to the purposes we envisage with these data transparency clauses. We are trying to tackle two issues. The first is fairness in the supply chain, with transparency of market data and terms and conditions. Secondly, we seek to support the roll-out of a new, much more innovative approach to livestock identification and traceability in the food chain.

The joint livestock information programme involves the farming industry, meat processors and DEFRA, to bring together what we currently have, which is a hotch-potch of different ID schemes for different species, coming from EU laws, and put that into a new single traceability database for animal welfare. That would give us the power to support that particular objective. Animal health and traceability are explicitly provided for because they support that.

[Dr Drew]

As my hon. Friend the Member for Bristol East said, animal welfare is a vital element in the reason why consumers should be made aware of lower standards when they buy foreign products. If we do not put that in legislation, we are effectively saying that we worry about health and traceability but the welfare of the individual animal is less important. So, we will continue to import animals that have been raised in the most inhumane ways.

Because this is a matter of data and information sharing, surely we should share that information with the consumer. I would like to ban such products outright, but that may be difficult with free trade agreements. At the very least, that information should be shared with consumers and I do not understand why the Minister is so reluctant.

[George Eustice]

It is because we have taken quite a large power to require the disclosure of information and we think it is important that we give people clarity and certainty about the purposes for which that will be used. Animal welfare is an incredibly important issue, which is why it is addressed in many other parts of the Bill—not least in clause 1, where it belongs.

To come to the hon. Gentleman’s point, if we were to have, for instance, a scheme requiring labelling on method of production, that could be done under other legislation. We already have the Food Safety Act 1990, for instance, which provides powers regarding labelling of food. There are other powers in other pieces of legislation that would enable labelling to be addressed. We do not believe that it is required in this clause of the Bill.

We have a joint passion about the importance of animal welfare, so I hope I have been able to reassure the hon. Gentleman that it is addressed elsewhere in the Bill, and that it would not be appropriate to include it in this clause, for the reasons I have explained. I hope that, on that basis, he and the hon. Member for Bristol East will withdraw the amendment.

Agriculture Bill (Tenth sitting)

Debate between George Eustice and David Drew

Committee Debate: 10th sitting: House of Commons
Tuesday 13th November 2018 Public Bill Committees

[George Eustice]

I will not, because, as I said, I want to deal with the substance of the clause.

The Government are clear about our approach to getting in place a new free trade agreement and a partnership. However, there are several other flaws with the amendment. First, we have to bear in mind that the impacts of a no-deal Brexit will vary from sector to sector; it is not possible to determine exactly what they will be. For instance, we know that the sheep and barley sectors export quite a lot of their goods to the European Union. However, we are net importers in virtually every other sector, so although there may be an impact on sheep, there would almost certainly not be on beef, because there will be less import competition.

I do not think it is wise to put this proviso into the Bill. The reality is that, if the terms on which we left the European Union—be that with no deal or any other circumstance that led to restrictions on trade—led to a severe disturbance in the agricultural market, and if that disturbance threatened to have a significant impact on agricultural producers, the power is already there to act. We do not need to artificially bring a current debate around the customs union into a Bill that is built to last for the long term.

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

One little snippet I learned last week is that the milk that makes Baileys Irish Cream goes backwards and forwards seven times across the Irish border. If there is not some sort of union—or agreement, as the Minister calls it—that will be catastrophic. Given that the backstop is the thing stopping us getting any sort of agreement, would he care to speculate on how he would overcome the downside of those movements not taking place?

[George Eustice]

The issue in all those circumstances is less about the customs union and more about border inspection posts. That is why we have outlined in our approach a commitment to a common rulebook on those areas that require a border inspection, so as to reduce or even eliminate the need for border checks, and then an agreement on equivalence in other areas of legislation. So the border issue is less about customs.

Let me give another example. Scotch whisky is currently our most successful export, and yet it is always sold as a bonded product in an individual national market, because you have different alcohol duties in national markets, even within a single market. We already have examples of some of our most successful exporting sectors having no problem at all dealing with variable tax rates within a market.

--- Later in debate ---

[Dr Drew]

The Minister quoted the US a minute or two ago. I have some experience of the way in which the US operates its agricultural policy. Whenever there is any challenge to US farmers, it brings the Farm Bill out and openly subsidises its farmers—it is a straight subsidy. That is one of the problems I have with a free trade deal with the US: it is not a level playing field if we get rid of direct payments. I ask the Minister again: how do we defend against exceptional market conditions in this country when another country has already decided that it is going to defend its farmers by taking action through subsidising them?

[George Eustice]

We are adopting an approach to agriculture policy that is all around investing in farmers to help them reduce their costs to improve their profitability and to reward them for the work they do for the farmed environment. Part four, starting with clause 17, which we are debating now, is all about intervention powers in exceptional circumstances. We have deliberately not defined what those are because there should be a strong element of discretion here, and the Government have to be able to move, decide and act in an expeditious way to tackle a crisis.

The hon. Member for Darlington mentioned this morning what sort of circumstances these powers might be used in. Bearing in mind that they have largely been borrowed from existing EU provisions, we know when the EU has used powers of this sort. For instance, it was possible when we had the dairy crisis in 2015 and prices slumped for a long period during the latter part of that crisis, for the EU to fall back on these exceptional intervention powers to make grants and payments available to farmers to reduce their production. That is the kind of example where it would be absolutely appropriate to use these powers. However, there are other times when we have short-term fluctuations in the market, and when it would not be appropriate to use the powers.

[Dr Drew]

The Minister is being very patient with me, but I want to get this on the record: if another country, which we may have a trading arrangement with, chooses to subsidise its farmers in extremis because of a particular circumstance, which may be—dare I say it—an act of God, or the market may just be in a difficult position, would we use this particular power to support our farmers?

[George Eustice]

If that crisis in a third country led to a market disturbance here that had an impact on our producers, then yes, the power is there to do so. There is wide discretion in how this power could be used. In practice, the reality here is that when we have a crisis, we know what will happen. The Minister of the day will have representations from Back-Bench MPs who have met their farmers and he will have to make a judgment about whether this warrants declaring that exceptional market circumstance and taking action thereafter to address it.

This is a wide discretionary power, but I am certain Parliament will be plugged in to advocating that we should declare this exceptional market circumstance and act. It is right we enable it to be a flexible power that can be used in emerging crises that we cannot yet predict.

[Dr Drew]

I am sorry to intervene once again, but this issue is a minefield, because if a group of my farmers come to me, and I then go to the Government and say, “Well, this is an exceptional circumstance”, and the Government say, “No, it’s not”, but the United States has treated it as an exceptional circumstance, that will surely lead to all manner of legal actions against the Government. Clearly, farmers will defend their rights and their incomes when they feel another country that is trading with us is getting an unfair advantage. Is he not opening a can of worms?

[George Eustice]

No, I do not think we are. We are largely replicating what already exists. It is already the case that if there was a crisis in the US, and the US intervened but the European Union chose not to, there would be some disparity—

[Dr Drew]

Well there you are.

[George Eustice]

We should deal with the situation in our market. The test we should apply before acting is whether there is a severe market disturbance that affects our agricultural producers. We should not be worrying about what other countries happen to be doing.

--- Later in debate ---

[George Eustice]

I do not accept that. We learned from the exchange rate mechanism crisis in this country that floating exchange rates work, and work for our economy. The ERM caused a deep recession in this country, and it was only by leaving it and allowing our currency to float and find its correct value that we saw that boom. We know that the existence of the single currency eurozone is throttling growth in countries such as Italy and Greece and causing massive unemployment, particularly youth unemployment. We know, too, that, since the referendum result, sterling has eased back against the euro, which has led to the biggest boost in farm incomes for more than a decade. In the two years since the referendum decision, farmers have benefited from the pound’s slightly softer rate against the euro.

On the amendments, I believe that the issues have already been addressed or that they seek to constrain or fetter the discretion in the power, so I hope that the Opposition spokespersons will not press them.

[Dr Drew]

This has been an illuminating discussion. The Minister has done well with a bad set of cases. Farm systems throughout the world are subsidised; they might be subsidised in different ways, but they are subsidised. In the normal course of events, that is not a particular problem—we can deal with it, partly because we are in the EU and so have a bulwark. The difficulty is that the clause puts an enormous responsibility on the Secretary of State—I would not want it if I were Secretary of State—to decide whether something is an exceptional market circumstance. I would want to know with my Cabinet colleagues that I had the power to insist on action.

The clause will make it difficult for a Minister to make the right decision, because farmers, understandably, will say, “You have to support us—the Americans support their farmers,” but here it is at the Minister’s discretion. That has always been our problem, and it is why I will press the amendment to a vote. I think my hon. Friend the Member for Darlington will do likewise with her amendment.

This is the crunch point of the Bill that we are asking the Government to consider. We do not want to fetter a future Administration, but we would want that Administration to understand their responsibilities, and that can be more clearly spelt out in terms of a duty—not a power, but a duty—so that if exceptional market circumstances were affecting the operation of agriculture in this country, the Secretary of State, or whoever was making the decision in government, had to respond, because of how the legislation had been framed. That is why I will press the amendment to a vote. I want to make it clear that the Bill is deficient in that regard.

We have heard many other interesting things that we will read back over with the benefit of hindsight. The Minister needs a few more examples to give us certainty that what is going on is coherent. At the moment, this seems a woolly set of arguments. We are protecting British farmers. We are also protecting British landowners, who might also be affected, as we can sadly see in California at the moment. I referred earlier to President Trump. He was hardly on the front foot. In a sense, the amendment would help the Secretary of State because he or she would know they had to act and that it was the Government’s responsibility. We can argue about what exceptional circumstances are, but the action should be clear, and that is why I will press the amendment to a vote. I think that my hon. Friend the Member for Darlington will be so moved as well.

Question put, That the amendment be made.

--- Later in debate ---

[George Eustice]

As I said a moment ago, we are currently reviewing this. We intend to publish the results and our thoughts on how the law should be changed in this area early in the new year. We can make the amendments we need through secondary legislation. Obviously, because there is now a food safety issue, given the problem with allergies, once we have decided what is necessary we intend to move quite quickly.

New clause 15 relates to another important area. The Government have already signalled that we are keen to look at this issue further. Before addressing method of production labelling, I draw the attention of the hon. Member for Bristol East to subsection (2)(d) and (g) of clause 20. Paragraph (d) refers to

“the presentation, labelling, packaging, rules to be applied in relation to packaging centres, marking, years of harvesting”,

and so on, and paragraph (g) stipulates

“the type of farming and production method”.

Taken together, those two provisions already give us the powers we need to do all the things the hon. Lady is seeking to achieve with her new clause. Although this is an important area, and one that we want to look at, I do not think that this specific new clause is necessary. I hope that it is a probing amendment, given that the Bill already covers this in subsection (2)(d) and (g).

However, I would like to touch on the substance of the issue. The debate that we have had, with its many interventions—as I said, the hon. Lady is here to lighten the mood of the Committee—highlights how important this is, but also how complex. There are lots of descriptors: we have “grass-fed”, which is not necessarily the same as “pasture-fed”; we have “pasture-fed systems”; we have “outdoor-bred” pigs or “outdoor-reared” pigs; there is “organic” and “free-range”—and often those terms mean different things. It is quite an undertaking to try to define all those in one bound. Probably the more likely thing would be to pick something, such as “pasture-fed livestock”, just as we have done for free-range eggs, where we can draw the criteria and roll out these types of descriptors on labels as we are ready to do so effectively, rather than bite off more than we can chew. The regulations would enable us to do that, so we could bring in schemes as we were ready to roll them out.

Another slight complication is the nervousness I have always had about going too far down the line on method of production labelling, because there could be unintended consequences. For example, at the moment there is a substantial market for outdoor-reared bacon, because people look for that on the packet. They are less inclined to do so if they are buying a pork pie, for instance. Some manufacturers of pork pies might buy from high-welfare farms parts of the carcase that are not used for bacon and that are maybe outdoor bred, but they might also buy pigs from other, more commercial producers.

We have to be careful that, by having onerous labelling requirements for some of those sectors where people are less inclined to seek out the descriptor, we do not create an unintended barrier to high-welfare producers accessing the market for parts of the carcase that they would not necessarily market on the high-welfare brand. I am attracted to moving in that direction, but there are complexities and difficulties around the definitions and potential unintended consequences. I hope that the hon. Member for Bristol East will agree that the intentions behind her new clause are already reflected in subsection (2)(d) and (g) of clause 20.

[Dr Drew]

I am partly assuaged by what the Minister has said. I hope he will commit to ensuring that there is an overt process by which the statutory instrument comes forward, so that we can allay the fears of those who clearly now have worries. That is why it is so urgent, and why we have provided an opportunity to make this amendment. People literally do not know what to eat because of their particular allergens. The Minister says that nobody knows quite why this has taken off in the way it has. I suspect that it is because we have become more susceptible to particular foodstuffs. Maybe it is because we know a lot more about why people have difficulties when they eat certain substances. It is right and proper that we give them the protection they deserve.

I will not push my amendment to a vote, but I will hold the Minister to account on this. We seem to have a very busy end of the year, and all manner of things will be coming forward. My hon. Friend the Member for Darlington might wish to take a slightly different course of action; I think the Minister has given certain assurances, but we will not let go of this, because people’s lives are threatened. We feel that, at the very least, it is important for people to know that what they eat is safe and will not affect them adversely. I know from various correspondence that Government Members feel the sam.

I hope that the Minister has heard what I have said and will act on it, and that he will bring the SI forward as a matter of extreme urgency. I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Amendment proposed: 82, in clause 20, page 16, line 2, at end insert—

“(2A) Regulations under this section may not amend or repeal any part of retained EU law (within the meaning of section 6 of the European Union (Withdrawal) Act 2018) relating to—

(a) the protection of the environment, or

(b) consumer rights.”—(Jenny Chapman.)

Question put, That the amendment be made.

--- Later in debate ---

[George Eustice]

There are lots of other conditions. Subsection (2)(e) requires that the constitution of the organisation meets certain requirements. There are other such provisions as well, so we do not have to define them as a body corporate in law in order to have express conditions that mean they would all be jointly and severally liable were something to go wrong.

[Dr Drew]

My hon. Friend the Member for East Lothian has covered one of the points that I was going to raise. Can the Minister give us some examples of the actual changes that mean that he sees the amendment as necessary? I think I understood the original way in which it was placed in the clause, but what representations has he received, apart from the one he mentions? Are we changing the legislation because of one piece of representation or have others come up with cogent points for a necessary change?

[George Eustice]

I can tell the hon. Gentleman about that. I have had experience of the EU scheme in the past and there have been instances where, for instance, some growers have said to me that they would like to come together for a purpose other than just marketing, and they would like the freedom to be able to do that. That is quite restricted in the new scheme. On the amendments, the representations came from Co-operatives UK. After we published the Bill the co-ops told us that some of the provisions were unnecessarily restrictive and might stop some of their members from being able to have a recognised body for the purposes of clause 23, so we responded to those representations, which made salient points, and we were happy to acknowledge them and table the amendments.

Amendment 9 agreed to.

Amendment made: 10, in clause 22, page 16, line 39, leave out paragraph (d).—(George Eustice.)

This amendment removes the condition for applying to become a recognised producer organisation relating to the legal form of the organisation.

--- Later in debate ---

[Dr Drew]

We are getting there, slowly, Sir Roger. I want to pick up the point made by the Minister on clause 22 about how organisations will be identified. I am a Co-operative MP; I put that on the record. The Co-operative movement has been somewhat wary of this part of the Bill—whether it is clause 22 or, in this case, schedule 2, on which I have the opportunity to make these points.

I welcome the amendments that the Minister has moved, at least recognising that the Co-operative movement has been unhappy to be labelled as purely part of the competition arrangements, given that co-operation is a key part of the agricultural sector. Many farmers and farm organisations are, by their nature, co-operative: whether it is NFU Mutual, equipment changes or buying feed or pesticides, they tend to act in a co-operative organisation. I am raising the issue under schedule 2 to put on the record that there is still some unease. The Minister has recognised that, given the amendments that he tabled to clause 22. He has explained why he changed the wording, and I am very happy with that.

The issue is about the impact assessment on the Co-operative movement, given that the producer organisations, the associations of producer organisations and the inter-branch organisations—all lovingly acronymed —are by nature not just competitive organisations. They are also co-operative organisations. The Co-operative movement has felt that there has been increasing uncertainty and regulatory risk. Having agreed to the amendments that the Minister brought forward to clause 22, I am asking him also to say something in our discussion about schedule 2. That clearly relates to clause 23, given that one follows from the other.

Established co-operatives fear that they might find themselves outside the new settlement. They are likely to manage most of the uncertainty well, but they want to know that the Government have heard what they have been saying. In a sense, they want the Government to mount a robust defence of where co-operation comes within agriculture.

The biggest risk is where established co-operatives feel uncertainty about how the Competition and Markets Authority might interpret the joint selling arrangements. That is an important issue for those who want to protect co-operatives, one of whom is myself. At the very least, the additional challenge they might be faced with will put a cost obligation on them, increasing the transactional costs of collaboration. They want reassurance from the Minister about how they should handle the situation.

Will co-operatives be subject to those types of challenges, if the legislation is passed as it is currently drafted? Will it at least make farmers less inclined to co-operate, given that the nature of the Bill is to look at different ways in which environmentally-inclined changes could lead to new ways of working? This is a very old way of working, but it may be given an enhanced status if and when the Minister can clarify whether co-operation would be a key element of how the Competition and Markets Authority would see the matter. The co-operatives did look at various amendments. The Government have listened, and the co-operatives are happy with what they have done through amendments 9 and 11 to clause 22. However, they want further reassurance, as the same logic applies to schedule 2.

This is a probing amendment, but it is important because the message the Minister gives will reassure or cause further doubt in the minds of those who wish to look at new forms of business organisations in terms of how they do their agricultural trade. Will the Government at least look again at the issue and ensure that what they have done with clause 22 will apply to schedule 2? If the Minister can assure me that the Government will do that, I will certainly not press the amendment, but we may have to revisit it on Report if the Government have not done what they should to ensure that the CMA can incorporate co-operation as well as pure competition.

Again, that is part of the current common agricultural policy arrangements and its interpretation of economic efficiency within the acquis. We want to know that it will be rolled over into British legislation and particularly how it will be rolled over into schedule 2.

[George Eustice]

I can give the hon. Gentleman that assurance. We have been in discussion with Co-operatives UK, which raised the issue about eligibility and the fact that the requirements for a corporate body and to have all members from one sector could affect some co-operative working. We listened to that and addressed it.

I do not think that there is a spill-over of that problem—for want of a better term—in schedule 2, because that schedule is essentially all the technical clauses needed to disapply what competition lawyers call “the chapter 1 prohibition”. In essence, schedule 2 determines and sets out in some detail the process by which producer organisations can come together to collaborate and co-operate in a range of areas and co-ordinate their activities in a way that would otherwise be considered a breach of competition law.

In particular, paragraph 9(1A) of schedule 3 to the Competition Act 1998 lists activities such as planning production, optimising production costs, concentrating supply, placing products on the markets and negotiating supply contracts. Schedule 2 gives licence to a recognised producer organisation to do all those things and to disapply those elements of the 1998 Act.

--- Later in debate ---

[Dr Drew]

The Minister makes an interesting point. I thank the hon. Member for North Dorset for getting my little grey cells working. Let us take Arla, for example—a co-operative that operates across a number of countries and that is not likely to fall foul of the CAP by being seen as a monopoly with more than 33%.

I do not have the current figures for the percentage of the milk supply that Arla processes, but if the Competition and Markets Authority took it as a purely national organisation and it fell foul of that 33%, could this new legislation mean that it ended up having to be broken up? I will need some assurance from the Minister before we go any further, because that is a good example of a co-operative that everyone would support, but which could now be in a disadvantageous situation if we take this as a national definition of its market control. Will the Minister clarify?

[George Eustice]

There is already national competition law set out in the Competition Act 1998, enforced by the Competition and Markets Authority. In the past, for instance, that famously led to the break-up of Milk Marque, which led to the situation we have today. There have been instances of that in the past under existing national provisions on competition law. I know the hon. Gentleman said he might come back to this on Report; I am happy to give an undertaking to look at this issue further and explain in further detail exactly what each of those clauses delivers. The clause that my hon. Friend the Member for North Dorset mentioned is an anti-avoidance clause—[Interruption.]

[Dr Drew]

It must be something we said—he has just left.

[George Eustice]

Yes. My understanding is that we have addressed the issues he has raised about the schedule, which are linked to the concerns that Co-operatives UK raised, through our earlier amendments.

Schedule 2 agreed to.

Clause 24

Regulations under sections 22 and 23

Amendment made: 12, in clause 24, page 19, line 7, after “unless” insert “section 29(4A) applies or”—(George Eustice.)

See the Explanatory Statement for Amendment 2.

Clause 24, as amended, ordered to stand part of the Bill.

Clause 25

Fair dealing obligations of first purchasers of agricultural products

[Dr Drew]

I beg to move amendment 48, in clause 25, page 19, line 21, leave out “may” and insert “must”.

This amendment would require the Secretary of State to make regulations for fair dealing obligations in Clause 25.

--- Later in debate ---

[George Eustice]

Although it might do so in a different way, it relates to competition law and is not an exemption from the chapter 1 requirements that we discussed earlier. The hon. Lady has not complained about the Groceries Code Adjudicator, which is administered on a UK basis and operates UK-wide; nor has she raised huge concerns about the way that the EU has always approached those matters, which is that they are a UK-wide competency and that switching on elements of the milk package is a UK decision and can be done only on a UK-wide basis. I hope that I have addressed the issues raised by the hon. Member for Edinburgh North and Leith about the role of Scotland in this reserved matter, and reassured the shadow Minister and the hon. Member for Bristol East that their amendments are unnecessary since they are provided for in part 2 of schedule 1.

[Dr Drew]

I hear what the Minister says and he will be pleased to learn that I will not press amendment 48 to a Division, but I am very concerned that the Bill has not been as clearly and cleverly scrutinised as it could have been because we were not able to meet a number of the organisations. I would have liked to ask the Groceries Code Adjudicator how the Bill could have made the authority more effective, but we did not get that chance. I do not know why she did not come; perhaps we were not as enticing as we might have been, or perhaps she did not get the push from Government.

It is important: this part of the Bill is about competition, fairness and accountability, yet we are in the dark, hoping that some of it will be carried through. The Minister has kindly given way on timber and we might see that somewhere in a schedule on Report, when he has talked to his colleagues. We are somewhat less than impressed by the Bill, and we need to nail down the legislation, in that we have producers believing that the Groceries Code Adjudicator is not able to function as effectively as she could, yet when we get the opportunity with some legislation to allow her additional powers those powers are not forthcoming.

--- Later in debate ---

[Dr Drew]

I hope not to delay us that much longer, because I think we are past the bewitching hour and we keep losing members—at this rate, the Whips are going to have to find someone non-existent to pair with—but it is important that we dwell on the issue for a few minutes.

Again, this amendment may not be that crucial to the Bill in the great import of things, but a number of organisations feel quite strongly about where this part of clause 25 is taking us. It is all about fair dealing and the obligations of the first purchaser of agricultural products. We have argued that that should not necessarily reside with the first purchaser, but should be across the food chain.

Amendment 86, which has the support of a number of non-governmental organisations, is about maintaining the confidentiality of complainants. That is vital, because they would not necessarily pursue a complaint without that confidentiality; evidence from the Groceries Code Adjudicator’s review highlighted that as an ongoing issue. The imbalances of power in many grocery supply chains create a climate of fear in which small suppliers are unwilling to speak out for fear of commercial reprisals. This reticence is understandable, because once a supplier is blacklisted regarding their ability to supply a particular food chain, that tends to become total and ongoing. Smaller players often rely on a single buyer for large proportions of their business—sometimes it is 100%. Even when a regulator is in place, suppliers still have concerns about coming forward. There is a need to ensure that there no single supplier is exposed to possible retribution by a more powerful mid-tier supplier and retailer.

Following an investigation, the new body should make relevant recommendations to deter poor practice, including penalising mid-chain suppliers or retailers found guilty of breaching the code. It is important to be clear that the confidentiality provided by this amendment is different from anonymity. We recognise that if the party bringing the complaint wants compensation regarding their specific case, they will of course need to be identified. It is not as though that confidentiality can be kept in place indefinitely, particularly where monetary compensation is required. The principle of the confidentiality of the identity of the complainants being waived only with their express consent is critical in ensuring that producers feel confident coming forward. That is exactly how the Groceries Code Adjudicator works, so we want to extend it along the food chain.

Amendment 87 would allow the enforcement body to undertake investigations without specific complaints, and again this is where we want to boost the power of the Groceries Code Adjudicator. An effective enforcement body must be able to hold the trust of suppliers and keep any evidence confidential until there might be some monetary arrangement, which would require going on the record. To achieve this, an enforcement body should also have the power to investigate potential transgressions under its own initiative, rather than require the submission of compelling evidence before it acts. My understanding is that that is what the Groceries Code Adjudicator has herself asked for. It would be surprised if she has not, because it completes her powers and responsibilities. The spotlight is taken away from suppliers and potential complainants, so it is on the Groceries Code Adjudicator herself to take those complaints forward. Without this clause we may see the enforcement body unable to identify issues that are either specific to one chain or one problematic behaviour activity, but where no single producer has been able to complain, directly for fear of delisting—that is a more appropriate term, I accept.

As I explained about amendment 86, there is a climate of fear. Therefore, we feel that proactive action by the regulator is vital. We want the Government to look seriously at this and use this legislation to enhance the powers of the Groceries Code Adjudicator, something that a number of us across the House have called for. We are seeking to use this legislation to do that because our producers feel that too often the Groceries Code Adjudicator is constrained by her inability to work across the food chain and to guarantee confidentiality and, when there is monetary consideration concerned, that this has been through due process.

I hope the Minister will give us the opportunity to consider how he can ensure that confidentiality is guaranteed, but also guarantee the enhanced powers of the Groceries Code Adjudicator. Again, this may not be the most important part of the Bill, but for producers who feel that they have fallen foul of the process and have, as my hon. Friend the Member for Ipswich said, felt bullied, intimidated or delisted from selling their products in the right and fair manner, we should use the Bill to put that right.

[George Eustice]

The amendments are linked to a common sentiment that we hear from farmers. There is no doubt that a number of people will say that they fear reprisals, consequences of being delisted or losing business if they were to complain. That has been recognised for some time. That is why we made changes early on to the remit of the Groceries Code Adjudicator, to enable her to receive complaints anonymously and pursue investigations when she had reasonable cause to believe there was a problem with a particular supermarket, and indeed to allow a trade body such as the National Farmers Union to pass on intelligence about the conduct of a particular supermarket that could inform an investigation. Even within the GCA, which is predominantly a complaints body, we have found the scope for anonymous whistleblowing and for third-party organisations to pass on concerns.

I draw the hon. Gentleman’s attention to subsection (5)(a) and (b). The specific issues he raises can be addressed through regulations. Subsection (5)(a) makes provision for regulations

“for complaints relating to alleged non-compliance to be referred to a specified person”.

And, crucially, subsection (5)(b) states

“as to how those complaints are to be investigated and how an allegation of non-compliance is to be determined”.

It is absolutely within the powers set out in subsection (5) for us to introduce regulations that would guarantee anonymity and enable complaints from third-party organisations, when they can hand on intelligence or create the scope for a regulator to investigate, when there is reasonable cause to believe there is a problem. I hope the hon. Gentleman will recognise that we think the particular issue that he seeks to address in amendment 86 is already provided for in subsection (5)(a) and (b).

Finally, although we hear a lot about this, Christine Tacon from the Groceries Code Adjudicator says that one of the most powerful things that can be done is for people working for processors and dealing with supermarkets to have assertiveness training, because we can put in place all the right regulations and have all the abilities in the world for people to report things anonymously, but there is a point at which people have to take responsibility and be willing to say to a supermarket buyer, “You know I cannot agree to that, because it is a breach of the code and what you are asking me to do is in breach of the law.” She said that when the GCA has placed people from those organisations’ sales teams on to assertiveness training, they have learnt how to use the code themselves without having to always run to her for an intervention.

[Dr Drew]

I find this quaintly interesting, because my experience of the milk trade is that they lack anything but assertiveness. There are more four-letter words in their way of trying to do business than could be heard on a football pitch on a Sunday morning. Sadly, it is not just about assertiveness, but fairness and the way in which this can be taken up by the Groceries Code Adjudicator. That is why a number of organisations—as always, at the top there is a whole series of different bodies—feel strongly that this needs additional powers to be vested in the Groceries Code Adjudicator. I hope the Minister has listened to that and will act on it.

--- Later in debate ---

[George Eustice]

The clause provides quite strong powers, including those to impose penalties for non-compliance on the first purchaser of agricultural products. If such a first purchaser happens to be a major retailer— perhaps one not currently covered by the groceries code, because it is below a certain threshold—it will be covered by the Bill. By addressing the problem from both ends of the telescope, we have a workable solution that means we can really deliver for the interests of farmers while not losing the successes of the Groceries Code Adjudicator model.

Having given that reassurance that the issues raised by the hon. Member for Stroud in amendments 86 and 87 can already be addressed through regulations under subsection (5), I hope that he will accept it and withdraw his amendments.

[Dr Drew]

I thought that the intervention made by the hon. Member for Brecon and Radnorshire was apposite. We are improving the legislative framework, including toughening up the powers of the Groceries Code Adjudicator, and specifically—in my amendments—we could ensure that people feel confident that there is a confidential arrangement between them and the Groceries Code Adjudicator so that they may pursue their actions.

As much as I like the Minister and hear what he says, this is how we improve legislation—we want to put something very important in the Bill. We know why so many producers do not choose to pursue a course of action against someone who has treated them unfairly: they are frightened. We will press the amendment to a vote—though we might not win—and the Minister is hearing from his own Back Benchers that this needs to be revisited on Report. We want to ensure that the Groceries Code Adjudicator can exercise all her powers, including along the food chain—because at the moment it seems to be very much a one-way street, which is why she is less effective than she could be. Also, producers feel that they are often let down, because they are not able to carry through regarding the unfair practices that they face.

This little amendment—it is very small—would dramatically change the power relationship. I hope the Minister will accept in good faith that we are pressing it to a vote so that he can reflect on it when it comes back on Report and strengthen this bit of the Bill.

Agriculture Bill (Eighth sitting)

Debate between George Eustice and David Drew

Thursday 1st November 2018 Public Bill Committees

[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 ---

[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

--- Later in debate ---

[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.

--- Later in debate ---

[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.

--- Later in debate ---

[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.

--- Later in debate ---

[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.

--- Later in debate ---

[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).

--- Later in debate ---

[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.

[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.

--- Later in debate ---

[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.

Agriculture Bill (Seventh sitting)

Debate between George Eustice and David Drew

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.

--- Later in debate ---

[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 ---

[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 ---

[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.

--- Later in debate ---

[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 (Fifth sitting)

Debate between George Eustice and David Drew

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.

--- 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.

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[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.

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[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).

--- Later in debate ---

[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 ---

[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 (Sixth sitting)

Debate between George Eustice and David Drew

Tuesday 30th October 2018 Public Bill Committees

[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 ---

[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—

--- 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.

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[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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[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 (Third sitting)

Debate between George Eustice and David Drew

Thursday 25th October 2018 Public Bill Committees

[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 ---

[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.

Agriculture Bill (Fourth sitting)

Debate between George Eustice and David Drew

Thursday 25th October 2018 Public Bill Committees

[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 ---

[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.

Cattle Compensation (England) (Amendment) Order 2018

Debate between George Eustice and David Drew

Wednesday 24th October 2018 General Committees

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

It is great to have the opportunity to debate this order and to set out the Government’s position on these matters. I will turn later to some specific points made by the shadow Minister and by my hon. Friend the Member for North Herefordshire.

Bovine TB is the most pressing animal health problem in the UK today. Over the last 12 months, more than 33,000 TB-affected cattle have been slaughtered in England, which is an appalling waste. The disease is damaging our rural businesses and causing much distress for farmers and rural communities. The cost of controlling the disease is about £100 million a year and a big burden on the taxpayer. To protect industry and to reduce costs for the taxpayer, it is right that the Government should continue to take strong action to ensure that we have a successful and resilient cattle farming industry as the UK enters a new trading relationship with the world.

Our comprehensive strategy to eradicate TB includes commitments to strengthen cattle testing and movement controls; to cull badgers in areas where they are an important factor in spreading the disease to cattle; to support badger vaccination in the edge area of the high-risk TB area; and to improve biosecurity on farms and in trading. Adapting the way that compensation funding is used to incentivise the take-up of good biosecurity practices is an important element of the Government’s long-term TB eradication strategy. That is why we are amending the Cattle Compensation (England) Order 2012 to introduce small but important changes to the compensation regime in England. These changes will encourage more herd owners to take sensible and proportionate steps to improve their biosecurity, thereby reducing the disease threat to their own and neighbouring herds.

I recognise that, for business sustainability reasons, some TB-affected cattle farmers must be able to bring in new stock to replace the animals that they have lost, and there are no plans to stop this. However, paying full compensation for cattle brought into a herd with a known and ongoing disease problem could be a disincentive for some to take action to reduce their disease risks. That is why we have decided first to follow the example set by the Welsh Government in 2016 by paying reduced compensation for any individual animals that are brought into a herd under TB restrictions and that subsequently pick up the infection and are removed while the herd is still restricted. Cattle farmers who register their herds under the CHeCS TB accreditation scheme commit explicitly to take steps to reduce their TB risks. For that reason, I decided that we will continue to pay full compensation to farmers for herds that are accredited in that way, since they have demonstrated that they are already taking action to protect themselves and to improve their biosecurity.

Secondly, herd owners have the option of sending their TB-affected cattle to their choice of slaughterhouse and taking a payment from the slaughterhouse operator in place of DEFRA compensation, but currently they are sometimes reluctant to do so. Many tell me they would like to use their local abattoir because it is closer and it reduces the stress on the animal, but this option has been taken up rarely. Under the existing rules, the keeper suffers a financial loss if the animal’s carcase is condemned at the slaughterhouse, since they receive no compensation and no payment from the slaughterhouse. Incentivising keepers to take this option will enable some to negotiate better prices for their cattle with an abattoir that they know and reduce the cost to the Government of compensation. The order includes a new financial safety net provision so that those who opt to organise the slaughter of their TB-affected cattle locally receive compensation at the same rate as other keepers of TB-affected cattle if the animal’s carcase is condemned. We are therefore removing the risk that farmers currently face when they send their cattle to a local slaughterhouse. This measure has been welcomed by the industry.

[Dr Drew]

I very much welcome what the Minister has to say about that aspect of the order, but who makes that decision? Is it the vets in the abattoir, or does the farmer who brings in the animal have to put that to the abattoir as a compensation arrangement? I am a bit unclear about that.

[George Eustice]

The decision about whether a carcase is fully condemned because the disease is rampant and the animal has too many lesions will be made by the official veterinarian at the abattoir. Currently, a farmer who chooses to slaughter privately with a local abattoir will receive no compensation and no payment for the carcase. In the vast majority of cases, the disease is caught at an early enough stage that the number of lesions is very small, so the abattoirs are able to get salvage value from the carcase—they are able to salvage most of the meat and turn it into value. A number of farmers have told me that they would like to take that option with a local abattoir, but at the moment, the risk that they might get no payment at all is a barrier to their doing so. The decision about whether the animal is totally condemned is one for the official veterinarian. If it is totally condemned, the farmer will receive the full compensation payment.

The third and final change that the Government propose is to reduce compensation for TB-affected cattle that are so unclean that the slaughterhouse operator is unable to process them. The UK has some of the highest animal welfare standards in the world, and the Government are committed to raising them further. I believe that there is no excuse for sending unclean cattle to slaughter. Reducing compensation for cattle that cannot be processed for human consumption will send a clear message that the cleanliness of slaughter cattle, including TB-affected animals, is an important animal welfare consideration. Thankfully, the number of TB-affected cattle that have been rejected because they are too unclean to process is very low—we are talking in the region of about 20 per year.

The order targets bad practice. For example, when an animal is condemned, the farmer might not take care of it sufficiently in the 10 days or so that it might take for the lorry to pick it up and take it to slaughter. He might judge that there is no longer any interest or value to him in that animal and he will get compensation anyway. I want to discourage that sort of behaviour. My hon. Friend the Member for North Herefordshire is a breeder of Hereford cattle; my family are breeders of South Devon cattle. I, too, know what it is like to suffer TB breakdowns, and I know the trauma and distress that that causes. I can say this much: if animals are condemned, my brother takes care of them and ensures they have plenty of bedding in the week or so that it typically takes for the lorry to arrive. If the animals that arrive at an abattoir are so unclean that they cannot even be processed—if they are in the bracket of the 20 per year—it is likely that they have not been sufficiently cared for, and that other animal welfare issues pertain to that situation.

[Dr Drew]

The time that it takes to get cattle picked up is one of farmers’ biggest frustrations. I do not regularly get rung up about it, but when I do get rung up about a herd breakdown, the one thing I am always asked is, “Can you get these animals taken sooner rather than later?” That is the worry about this. I am not saying that neglect is in any way acceptable, but if someone has had a massive breakdown and they are told that their cattle may be taken some time over the next week to 10 days, that is not much of an incentive. Those people are really at their wit’s end. If there is one thing the Minister should take away from this, it is that we should speed up the process by which animals are taken—certainly, once they have a whole herd breakdown.

[George Eustice]

All I can say is that APHA does run certain programmes for that and picks up the animals as soon as it can. It usually happens within days; sometimes it can take a week.

I return to my initial point: typically, once an animal has become a reactor and tested positive to the disease, the farmer will keep it in isolation in a shed somewhere. Is it really too much to ask that farmers ensure there is full straw bedding in that shed for the week or so that it takes for the animal to be collected? My view is that it is not.

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[George Eustice]

The approach will be exactly as it is now. The official veterinarian makes the decision about whether to condemn an animal for being too unclean to process. We have just passed legislation to have CCTV in slaughterhouses, and the official veterinarian collects photographic evidence to demonstrate that an animal was unclean. The OVs have processes to manage this. Ultimately, the FSA is independent and the OVs on the ground will make the decision, as they do on many other such issues.

The shadow Minister asked why we are making these changes. My approach to changes to compensation is clear: I have always rejected such changes simply for the purpose of saving money. In my view, we should change compensation arrangements if that will change behaviour. He also asked about the legal implications. I point out that we are doing exactly what the Labour Administration in Wales did in 2016. We are simply bringing England into line with the approach that has already been adopted in Wales, which has been successful and has not led to legal challenges.

The shadow Minister asked how we would determine whether a breakdown was due to a disease that an animal contracted before it entered the herd or when it entered the herd. We do not intend to make that distinction, since we are trying to incentivise caution among farmers about the animals they buy in. We want to make clear that if farmers are trying to go clear, they should not buy in animals that are at high risk of having TB. If it is possible for farmers to delay re-stocking and be more cautious about the way they do that, they may choose to do that.

I was very clear—we changed the order from its original draft to reflect this—that I want to ensure that any farmer who signs up to the CHeCS-accredited scheme to demonstrate that they are taking biosecurity seriously and taking proactive action to reduce the exposure of their herd will still qualify for 100% compensation. Any farmer who might be affected by this 50% reduction by bringing animals into the herd when they have an ongoing breakdown can mitigate that immediately simply by signing up to the CHeCS accreditation scheme. Anyone can join CHeCS; they have that option.

The second option, which should be seen in the context of earlier points, is that if a farmer has a breakdown or an animal is brought on, he would now have the option to go for private slaughter and get the salvage value under one of the other provisions that we are introducing. Even if a farmer said, for entirely ideological reasons, “I refuse to do biosecurity because I believe badgers are to blame, and I am not going to do biosecurity; I won't sign up to checks,” he still has the option to get a salvage value by sending that animal to a local abattoir of his choosing.

My final point is on scale. About 1% of cattle herds bring animals on to their herds when they are under a restriction. They tend to be predominantly dairy herds. We suspect that around 250 herds might be potentially affected by this measure, but every single one has the option to join the CHeCS scheme and to immediately mitigate that risk. That would be a positive step forward.

[Dr Drew]

I know about the CHeCS scheme. How do farmers sign up and who checks the CHeCS scheme? I am a little bit concerned that this is not as clearcut as it sounds. Could the Minister elucidate on what that scheme is and how it works?

[George Eustice]

The CHeCS scheme is a United Kingdom Accreditation Service-accredited scheme that certifies that farmers are adopting proactive measures to improve their biosecurity. That could include, where necessary, putting additional fencing and protection on yards to stop badgers getting into contact with animals. It can involve adopting a particular risk-based approach to the way they trade. It can also involve investment in special drinking troughs so that badgers cannot get access to them, and so on and so forth.

I often hear from the hon. Gentleman and the Labour party that we should not be doing a badger cull and that we should be doing biosecurity, vaccination and other things. My answer is that we need to do all of those things. In the two areas where we first started the badger cull, we have seen a 50% reduction in the incidence of the disease, but that is not enough on its own. We also have to improve biosecurity and we have to continually refine our cattle movement controls. If the Opposition are serious about this, they must recognise that we must take biosecurity seriously too. That is what we are seeking to do.

Agriculture Bill (Second sitting)

Debate between George Eustice and David Drew

Tuesday 23rd October 2018 Public Bill Committees

[George Eustice]

Q Finally—I know we are short of time—part 2 of the Bill gives the Government powers to simplify and improve the legacy basic payment scheme system. What would your organisation most like to see changed during that transition period?

Andrew Clark: That is a good question. One of the things we would like to see is a simplification of the approach. The objective of simplifying and improving is laudable. One of the concerns about the transition relates to untangling the bureaucracy we find currently with greening—the detail of measurement and that type of thing. In terms of outcomes, however, some of those greening measures potentially have good benefits for farm businesses and the sustainable management of land and soils, and we would be disappointed if the existing benefits from agriculture production were lost during the transition period.

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

Q Very quickly, what other worries have you got about this Bill?

Andrew Clark: There are a number of worries. The Bill is fairly silent on three crucial areas that we think need to be addressed. Ministers have rightly made a lot of points about farmers’ proud record on caring for the environment and, in particular, animal welfare and health. It seems to us that the Bill should give greater provision to protecting and retaining farming standards, environmental standards and animal health and welfare standards, in the face of the new trading environment. We would like to see some measures, and perhaps some amendment, relating to that.

As the Minister has pointed out, the long-term commitment is for farming to continue to deliver a contract around environmental and land management. That is a multi-annual commitment, and we believe that there should be a multi-annual budget to go along with that, rather than just a year-to-year budget. We would like to see something that reflects the long-term nature of the farming community’s expectations in the Bill.

The final thing is that we feel that there is not quite enough agriculture in the Agriculture Bill. Although it sets out clearly what types of things can be done—perhaps not how they will be done—it does not say who will benefit from those payments. We think it is important that it is the active land manager, the farmer and the food producer. It should be seen through the prism of food production and the active management of land.

--- Later in debate ---

[George Eustice]

That is it for now.

[Dr Drew]

Q 44 Will the Bill bring forward younger farmers, and if we have that as a central point—given the farming community’s present average age—how could it be further improved to bring forward even more younger farmers?

George Dunn: The important thing is to see that this Bill is a scaffold, not a building, so until we see the shape that the Government decides upon for building the building around the scaffold, then it is difficult to tell exactly what will happen. But we are certainly encouraged by the facility within the general framework to have both de-linking and consolidation of payments, which we believe could speed up retirement and restructuring within the sector, to make holdings available to new entrants.

Many of our tenants who let land under farm business tenancies, unlike those who let under the Agricultural Holdings Act 1986 with secure tenancies, would say to us that the basic payment scheme is a cost on their business, because they have to pay that in rent to the owners of the land, whom they want to take the land from. So long as we have a strong arm on the productivity side of this Bill, which focuses on the new entrants and the progression point, we think there is great hope.

Christopher Price: I would agree with a lot of that. Inevitably, if we shift away from basic payments to a more market-facing world, it will create some churn within the sector. Older farmers are likely to decide to move on. That is why it is so important that there is sufficient investment in productivity, so that those who want to start on the farming ladder can get the necessary skills, not just farming skills, but business and marketing skills, which are so important in this sector now.

--- Later in debate ---

[Dr Drew]

Q Does that worry you?

Dr Fenwick: Hugely. They are untried, untested and un-modelled. We have not had an impact assessment. From a legal point of view, I have grave concerns that they may contravene WTO rules. It was concerning to hear our own Cabinet Secretary—last week, I believe—read her response to a written question from the shadow agricultural spokesman for the Conservatives, Andrew R. T. Davies, in which she said that it was not appropriate to inquire whether what was being proposed is legal or not for the World Trade Organisation. That is a grave concern and we are well aware of the sort of problems that can crop up when it comes to the WTO. It is going on with regards to the USA, China and Europe at the moment, including with regard to agricultural goods.

[George Eustice]

Q As a point of clarity, agriculture policy is devolved, so perhaps I can clear up the mystery as to how the Welsh Government did it. They simply asked us to include a schedule in the Bill. Northern Ireland did the same and Scotland was the only part of the UK not to. There was no lobbying exercise or debate. It was a request that was duly accommodated.

I want to probe this point about the WTO. What is it in particular that concerns you? We obviously have an amber box allocation in which we could do market-distorting support if we wanted to, and it is largely accepted that the proposals would be green box. Just explain your concern about the WTO.

Dr Fenwick: Specifically, annex 2 of the agreement on agriculture sets out strict rules in relation to “Payments under environmental programmes”, which prohibit payments that are over and above costs incurred and income forgone. That is an explicit disallowance of such payments, superficially at least. I am not a barrister or a lawyer, but it certainly seems fairly black and white. That is a grave concern given that we have asked for clarification and have not received it as explicitly as we might have liked.

I do not want to imply that it is not legal, but there is an ambiguity around it— payment for public goods is effectively environmental payments, which is what annex 2, paragraph 12 of the agreement on agriculture deals with. It raises concerns that, even if it was legal, it could be used as a vehicle for other countries spuriously to raise barriers to trade and so on. That could trigger a lengthy dispute that goes on for years and has adverse impacts on us. We know from experience that countries tend to use such tools where they become available.

John Davies: A major part of the support for public goods is dependent on moving in that direction in terms of the boxes. That has never been done by any other country before and we are obviously concerned. We need to see some proof that that has been properly researched and is achievable.

Huw Thomas: I do not have anything to add to that.

Agriculture Bill (First sitting)

Debate between George Eustice and David Drew

Tuesday 23rd October 2018 Public Bill Committees

[Dr Drew]

Q I have one further question that follows up on that. Is it clear how the idea of public moneys for public goods is going to work in practice?

Thomas Lancaster: The Bill does not necessarily set out clearly how it works in practice as a framework Bill. We would like to see, for example, a clause that sets out much more clearly how public money will be provided for public goods in the long term. We think that the Bill needs to provide much more certainty about the funding cycle, how the quantum is arrived at, and how the funding is allocated between the four countries of the UK—that is a key area where we will look to improve the Bill.

In terms of how a public goods scheme could operate, we have in the UK 30 years’ experience with agri-environment schemes. The first schemes were developed in Norfolk and then rolled out throughout Europe through the common agricultural policy. We are world leaders at developing agri-environment schemes, which are the blueprint for the public goods scheme that the Bill proposes. There is a huge amount of debate to be had over the next two or three years about how best to design the scheme in a way that works for farmers, the environment and the taxpayer.

Martin Lines: We understand it to be a framework Bill: much of the detail about how it will be delivered to farmers will come later. We in entry level stewardship and higher level stewardship know that we can deliver great stewardship. Some of the reward for that is not great. There are a whole load of assets on our landscape that many farmers can actually get better rewarded for—it is not just about how we manage the food production side, but how we manage our landscapes. Some farmers can get rewarded more for the landscape side and then get the food production from that, because they have limited capacity within that landscape to get financial rewards. It is about having a joined-up approach.

Patrick Begg: Tom makes a good point about the mechanisms that need to underpin this, which are around multi-annual payments. It is about being able to see something that goes beyond the political cycle. That is one thing that the common agricultural policy has actually delivered—some certainty and confidence in the farming industry in what they need to invest in. That is one of the things that we really need.

If we think about duties rather than powers, duties to create those multi-annual systems seem to me critical. There is also another obvious question, because a lot of this does come back to money, in terms of the quantum. We have done research that has demonstrated that just to deliver the kind of public goods that we have listed here would take at least £3 billion a year across the UK, and that was just updating what the Land Use Policy Group did about 10 years ago. There is a strong evidence base for the quantum, so it would be very useful if the Bill gave a duty to produce an independently assessed sense of resources needed, and if those were linked into multi-annual contracts.

There is also something about targets. It is a truism across loads of corporates, and non-governmental organisations—anyone—that you manage what you measure. If we can see some way in which these can be quantified, and some really stretching targets that could tie resources to those, that would be incredibly helpful. That sends a very strong signal to farmers about the confidence that Governments have in the things that we are asking them to do. It is all about setting that sense of confidence and clarity about purpose.

Gilles Deprez: For me, the Bill and the law are not very clear, so my honest answer to your question is probably, no, I don’t know how it will work. I also do not have enough experience of the previous way of working with the common agricultural policy. What I do see from my limited experience is that we have different types of environment in the UK. For example, in west Cornwall, where I am, my average field site is about four acres. If I need to put, for example, buffer strips in my field around my hedges, I will not have any productive land left.

You cannot compare, for example, Cornwall with Lincolnshire or Scotland. It is very difficult to understand how it will work in practice. You are asking a lot more from a system than what it is used to in a certain way, to become more targeted and specific, so I think it will be a very big challenge to see how it will work in practice. That is my honest opinion.

[George Eustice]

Q The premise behind the Bill is that the long-term end stage should be that we move away from a system of arbitrary area-based subsidy payments to something where we first correct the causes of low profitability in farming, through things such as improvement in the way in which the supply chain operates, grants to invest in new technology, research and development, supporting structural change where necessary, but also properly rewarding farmers for the work they do for the environment. That is not necessarily on an income-forgone principle but on something that is genuinely rewarding that does not begrudge them making a margin in the way that the current pillar two schemes do.

I would like to know your views on whether you believe that is deliverable, if we rewarded the environmental outcomes properly to ensure that we had a viable model. What would that look like? What is your view on natural capital principles, in terms of pricing those options? Are there other things that you would like to do? Or do you believe that income forgone should be the basis on which we operate payments in future?

Martin Lines: It is a positive move forward. We know most farms have been doing some kind of stewardship and have had frustrations with the system, and that puts a lot of people off. What we have got to think about with this scheme is can we deliver it in nine or 10 years’ time, when it is fully rolled out, and add the focus of what we want in 10 years’ time, and how we have got time to adjust to it.

Payments at the moment are attached to land. As someone who rents land, I give payments straight to my landlord; it is included on top of my rent, so it stresses my business. I often pay it out 12 months before I receive it from Government, so giving it to the farmer for the work he does, such as my stewardship work, rewards the farmer for his best practice, and keeps it within the farming industry, which can then use it in local communities, with contractors and various other parts. It cycles it round the local community in a better way.

Patrick Begg: I am definitely a fan of moving it towards a more outcomes-based system. In fact, we have been working for a couple of years with a group of our farm tenants in Wharfedale in Yorkshire to understand exactly how we might establish an outcomes-type measure. It comes with a bit more risk, because some things are lag rather than lead, so it takes a while to mature your outcomes. We have to relax into that and understand that if people are doing the right thing, good things will flow at the end of it. That requires us to have a really good system of land management planning locally, but the critical thing we learned from our outcomes project in Wharfedale was about the quality of conversations and the sense of shared endeavour. If you set a destination, allow a farmer really to have agency over the route for getting there, and give them flexibility to do things differently, try things, and work with the skills and rhythms of their farming business, you get a much better sense of engagement.

It takes time and requires individuals who have trusted adviser status. For example, if ecologists talk to farmers, they learn about each other’s world and then they come up with a good answer, which makes a massive difference. That relationship has a huge gearing effect on the quality of the stuff you get at the end of it.

There are technical, mechanistic things that we have learned about what kind of measures work for pollinators, soil, etc. It is now perfectly possible to measure them and account for them. The trick, without this becoming massively bureaucratic, is for the people managing the land to have a sense of delegated agency. We use the farm tenants as our eyes, ears and monitors, and get them to report back. It really turns them on. We have had enthusiasm and a sense of joy creating the kind of things that we as a conservation organisation were looking for. It really worked within the framework of their developing businesses with extensive livestock in some quite sensitive upland areas. I am a great fan. I think it is perfectly possible, and we have got lots of evidence about how it can be done.

Thomas Lancaster: On the point about income forgone and payments, we regard income forgone and costs as a good starting point, but it is flawed in that it does not adequately incentivise the most profitable businesses, and it does not adequately reward the least profitable businesses, particularly in terms of farmers farming in places such as the uplands, which are inherently economically marginal. We encourage Department for Environment, Food and Rural Affairs to start there, then look at where we need to go in terms of building in that reward—that adequate incentive or fair return, which is how some officials talk about it.

On Wharfedale, the uplands and the public goods that those non-economic farming systems can provide, rather than just look at the cost of an individual intervention, such as managing a hay meadow or some other species-rich grassland, do you look at the whole- farm system as a cost? Rationally speaking, it is a loss-making business, and it would not necessarily be rational to run it without some form of public support. If we want to keep that sort of marginal farming going to secure outcomes for curlew, black grouse and other species that depend on it, we will need to look beyond income forgone, in terms of building an adequate and fair return for those environmental outcomes.

Like Patrick, we are big supporters of results-based and outcomes-based payment schemes where they can be shown to work and be proportionate. We think there is scope for continuing action-based payment schemes, where you pay based on the action. Similarly, we are big supporters of natural capital, particularly in assessing the benefits that a future policy based on public goods can provide. We know from previous economic studies—one looked at sites of special scientific interest—that for every pound spend on investing in SSSIs, you get £8.56 back. There is huge benefit to investing in the natural environment not just for society but for farmers, in the benefits you can get from pollinators, crop pest predators, arable systems and more resilient grassland management in lowland and wet grasslands. The places that were managed more extensively in Somerset after the floods recovered much more quickly than other more intensive systems. We are really evangelical about the benefits of a public goods approach, not just for society but for farmers, and a payment system that builds in a fair return will be a key part of that.

Gilles Deprez: The practicality will not be easy. It will be a long journey. It will depend on the people; every farmer, or land manager, has a different mentality on implementing it. To give an example of one of the things that we are trying to work on as an operation, because we are also a tenant, we are fortunate to have the Tregothnan estate, where we are working, as one of our landlords. One of the questions was, do you think that you should value natural capital? We are working on that. We are working on a tenant agreement, which is in place at the moment, where natural capital has a financial value.

It is a bit difficult to define it, because what is natural capital? You need to take a very holistic approach. At the same time, it needs to be very simple. We brought it back to soil, because it all starts with soil. We tried to value the difference between good and bad soil. We are still working on the exact parameters of what it means, but the moment that something has a financial value, people respect it. That was the idea that we had. We are still in a very early stage, but it is quite promising to see what is possible.

If something has a financial value you can create an asset with it. At the same time, you can create a liability for whoever is doing it. The whole principle is that the landowner has the asset of the land, but everything that we are trying to do in terms of increasing the natural capital on that farm is our property, because I, as the farmer, did it—I tried to increase it, or decreased it. It is a very difficult concept because of the competitiveness of farming. We need to ensure that that model is not breaking farmers, because farming is very competitive. You have to find a fine balance. With the Tregothnan estate, we tried to develop it further, but in a very down-to-earth way, so that we are not breaking the idea or the system. It is probably too early to implement it today, but there is potential.

It will require a lot of effort, and many farmers will need to be part of that transition. It is not something that you do overnight. If you take on a farm that is depleted, or where the soil has gone, it takes years, and a massive amount of capital, to rebuild it. That is very hard in a very competitive environment where you need to have a good crop again next year, and a margin to reinvest in your farming operation. It needs to be built over a longer period, and you need to have that long-term strategy as a farmer to do that, which is not always easy—far from it.

--- Later in debate ---

[Dr Drew]

Q Do you think that the Bill satisfactorily addresses either animal welfare or animal health issues?

David Bowles: It is a very good start. You have to put it in context. The CAP has allowed payments for animal welfare since 2003, so we have had two seven-year cycles. If you look at how many schemes there have been in the UK for animal welfare during that time, there has been one, in Scotland. That is not due to lack of enthusiasm from the devolved Administrations; that is due to lack of money, because pillar 2 has not given that money to open up those particular financial streams.

The RSPCA was delighted when the Bill came forward and acknowledged that animal welfare is a public good. Of course, we would like to see, as the previous presenters said, more clarity that there are duties to give money to animal welfare, because animal welfare has been squeezed out in the last 15 years under CAP and we do not want to see it squeezed out in future.

Yes, it is a good start. We would like to see some ring-fenced funding. We also crucially welcome the fact that the Department for Environment, Food and Rural Affairs has linked in animal health and animal welfare. Those two are crucial. If you are looking at things such as lameness and mastitis, if you are trying to improve one, you are improving the other. I think there is a huge opportunity for win-wins here on animal health and animal welfare.

ffinlo Costain: I agree entirely with what David just said but I think there is a real challenge. We would like to see a whole-farm approach to environmental land management schemes, so that you do not have progress on one public good on one part of the farm, but degradation of that same public good on a different part of the farm. Part of the challenge is around understanding the role that farm animal welfare plays, not only in and of itself to improve the lives of animals, but as an indicator of progress on environmental improvements as well. From that perspective—sorry, I am not sure what the second thing was that I was going to say, but that will do for now.

Simon Doherty: By way of an opening remark, I fully concur with what David and ffinlo have just said by way of introduction. Certainly, the BVA position would be that we feel that this is a really good start. It is a nice piece of legislation. There are sufficient powers contained within it, we feel, to give the Secretary of State the ability to make appropriate changes where necessary within the realm of animal health and animal welfare.

Our overall position is that health and welfare are inextricably linked, but although we feel that there is a lot to be gained by maintaining that link, there are times when we need to separate welfare and look at particular aspects that relate to welfare outcomes—good welfare on the farm is not just absence of disease. There are times when we appreciate that there is a very close link between health and welfare, but there are also times when we need to be able to measure each separately. For both to be public goods, there need to be appropriate measures across the board.

ffinlo Costain: I have remembered my final point. Our view is that climate change and biodiversity must be addressed together. You can get some quite perverse outcomes, particularly on farm animal welfare, if you simply focus hard on greenhouse gas emissions; you displace some of the environmental impact of the feed production, nitrous oxide production and carbon dioxide production that is associated with those more intensive systems. It is really important that farmers should not deliver some public goods at the expense of other public goods that are part of that. Improvements in climate change and biodiversity must be delivered together, and farm animal welfare is a great indicator of progress in both those areas.

[George Eustice]

Q The premise behind the Bill is that, as you said, animal welfare is a public good, just like environmental outcomes. That is quite a radical, new thing for the Bill to state explicitly. Just as we have environmental stewardship schemes now, we intend to design schemes that could support higher standards of animal welfare for farmers that go above and beyond a regulatory base. What is your view on the design of such schemes, given that this is quite new? Some countries have tried it. Should we emphasise investment in capital to get new housing that is more animal welfare-friendly? Should we incentivise people to join holistic higher welfare schemes? Should we pay farmers for delivering results, such as pigs arriving with intact curly tails at abattoirs? What is your sense of the balance between those, and what type of interventions do you think we ought to consider?

Simon Doherty: It is probably all of the above—it is the whole piece across the board. In measuring the outcomes, it is important that we do not just reward farmers for doing the minimum legal standard. It is actually about going above and beyond. The overall purpose has to be to raise the bar right across the board. It should not just be about rewarding the farmers who choose to do things above and beyond; it should be about bringing people who are a little bit behind the game on welfare to a point where they improve their end game. That will not just be through a purely financial reward—quite a bit of thought needs to be put into the individual schemes to make sure that we are bringing everybody along. It certainly needs to be right across the board.

David Bowles: I mentioned at the beginning that the UK has only ever had one animal welfare scheme, but in the EU there have been 50 different rural development programmes on animal welfare over the last two cycles since 2007. They provide a huge amount of rich experience that shows that you can get good welfare outcomes from inputs from financial incentives. The RSPCA would like to see a two-tier system that has both the incentives that the Minister mentioned. For instance, you would have capital costs for rewarding people who build larger lunging spaces for dairy cattle. You would have outcome-based measures—for instance, the number of tails on pigs going through abattoirs that show a lack of mutilation. As Simon said, you should aim for people to go to a higher welfare scheme, such as RSPCA Assured. We believe that if you do so, you will get the incentive to improve animal welfare and animal health, and you will get farmers using a much better farming system than they use at the moment. This gives us a real opportunity to break the mould on animal welfare and get much better animal welfare farming happening in the next 10 years or so.

ffinlo Costain: I agree with both the previous comments. It is essential to increase standards across the board. We should not only improve those standards as and when we leave the EU, but put in place a mechanism—and metrics are a really important part of this—to enable us to continually review the standards, based on what is being achieved by farmers, not just in the UK but around the world, to ensure that our standards continue improving. I think that at the moment, DEFRA want to provide financial assistance for farmers who are genuinely trying to improve their systems. We support that, and we think that sometimes, that assistance may need to be quite substantial. I think that DEFRA also want to reward particular excellence, and again, metrics are critical to measuring that progress. The best way for Government to achieve this is to work with existing—and possibly new-entrant—higher welfare schemes, schemes like RSPCA Assured, Soil Association and others, and then provide rewards based on particular metrics that the Government agree are critical.

In terms of metrics, we should not just be focusing on inputs. There is often a lot of focus on the inputs—the type of housing, the space allowance, the genetics of the animals, and that sort of thing—but we should also be looking at the outcomes: what is achieved. The inputs give us the key determinants in our ability to deliver improved farm animal welfare, but the outcomes tell us whether that improvement in welfare has been delivered. We need to see on-farm metrics that help farmers improve their day-to-day efficiency, the productivity of their businesses, and their ability to deliver better welfare and better sustainability in the round. There is also a huge opportunity across the nation at the moment that is underplayed, which is in the area of slaughter. That is where most livestock end up. There is potential to gather an enormous amount of helpful data that will help farmers, policy makers, and retailers’ assurance schemes deliver better welfare, and have a much more forensic understanding of where welfare sits across the board and whether attempts to improve welfare are being successful.

Simon Doherty: Minister, there is also a real opportunity to engage new technologies that are being validated to measure some of these objective welfare outcomes. A huge amount of work is going on, and the UK is very much ahead of the game on this. We have some fantastic research centres across all four regions of the UK that are doing brilliant work on things like thermography, video imaging, wearable devices and so on, which are helping to measure health outcomes, but are also being validated to measure welfare outcomes. We do not necessarily need to cover all of our farms in that technology, but incentivising the uptake of some of these new technologies that can be used to benchmark animal welfare will be increasingly important as we go forward.

We have had a huge amount of engagement recently. BVA produces an infographic on welfare related to farm quality assurance schemes, and there has been a huge amount of uptake right across the board on that, including—as was previously mentioned—RSPCA and Soil Association schemes. As I say, that is going to be really important to building public engagement about this being a public good.

Brexit: Trade in Food

Debate between George Eustice and David Drew

Thursday 14th June 2018 Westminster Hall

[George Eustice]

I am interested in history, but I am not necessarily interested in implementing all historical policies. To extend the history lesson, there was also a view in the 1960s that we should not have subsidies but we should have tariffs. Obviously, we have moved some way since then.

[Dr Drew]

I always love a bit of history, but to bring us up to date, in all those previous reorganisations and structural changes, there was time to make changes partly because the British Government were deciding things for British farmers. Will the Minister assure us that the transition period must respect the importance of these changes, and that there must be support for those who will suffer if we get this wrong in the short run?

[George Eustice]

Yes. I was going to return to that point. The Select Committee report states that we have to take care during the transition. We absolutely recognise that. Indeed, in our recent consultation, we described what we have as an agricultural transition, where any changes we make to the support regime will be done gradually over a number of years to take account of the fact that we do not want to deliver unsustainable shocks to the industry that it would not be able to cope with.

My hon. Friend the Member for Tiverton and Honiton mentioned the importance of Northern Ireland. I absolutely understand that a huge amount of trade takes place across that land border. That is why, unsurprisingly, the way we should approach that issue dominates much of the discussion about our future arrangements with the European Union. He will understand that that is a much broader discussion, which is being handled by people in the Government more senior than me.

Let me pick up on some of the issues raised by the hon. Member for North East Fife (Stephen Gethins), such as customs, which is being looked at. We have a cross-Government working group, which has brought on board lots of Departments, including Her Majesty’s Revenue and Customs and the Treasury, to look at customs, as well as DEFRA and our Animal and Plant Health Agency to look at border inspection posts. DEFRA’s focus is ensuring that we have the right capacity at any border inspection posts, and we will seek to agree our approach to that. Generally speaking, customs is regarded as an easier and more administrative thing to do, rather than necessarily requiring lots of checks and infrastructure at borders. Technology really has moved on in that area.

I simply make the point that one of our biggest successes in food and drink—perhaps the biggest, and certainly the biggest in Scotland—is Scotch whisky. We have zero tariffs on Scotch whisky, but that sector competes globally and has a recognised international brand. It is also very used to dealing with national markets, even within the European Union, because there are different alcohol duty rates so there must be bonded supplies for each country. There are sectors that have got very good at managing borders. Several hon. Members made the point in yesterday’s debate that we have borders even within the single market for things such as customs duties.

Probably the second biggest food export from Scotland is Scottish salmon, which again is renowned around the world. Scotland’s biggest competitor in that sector is Norway, which is outside the European Union and outside the single market for the purposes of fish products, because, as the hon. Gentleman will know, the European economic area does not cover fisheries products. So there are sectors, including fisheries and Scotch whisky, that have developed quite sophisticated ways to address some of these challenges. This is not an insurmountable problem.

The hon. Gentleman also raised seasonal labour. We recognise that that issue is important, which is why the Home Office commissioned the Migration Advisory Committee to look at what our labour needs will be after we leave the European Union. The MAC is already doing that piece of work. It published an initial summary of the responses it received, and it is now looking in earnest at what arrangements we will need after we leave, and in particular after the end of any transition period.

However, in some ways we already have the necessary structures in place under our existing migration system, through things such as tier 3. That is currently set at zero because we have free movement of people, but we could make some allowance for work permits in less skilled sectors if we wanted to and deemed that we needed to. We have been clear that we are looking at the idea of a seasonal agricultural workers scheme. We had one, which ran successfully from 1945 until 2013, and we have been clear that we are looking at that issue. I worked in the soft fruit industry for 10 years, so I am fully aware of some of the challenges. Those are issues that we will have the power to deal with as an independent country—they will not need to be negotiated with others.

[George Eustice]

Look, on your first point—sorry, Mr Gray, it is a contagious problem. On the hon. Gentleman’s first point, there are degrees of independence. As things stand, as an EU member we do not have an independent farming policy, an independent fisheries policy or an independent policy on migration. When we leave and become not an EU member, we will have independence in those areas.

On the hon. Gentleman’s second point, there will be some challenges, but we have been working on this area. One scenario we have been planning for right from the referendum result is a no-deal scenario where we come out without an agreement, even in March next year. There are contingency plans and work has been done to prepare for such scenarios. While there will be challenges, we are aware of them and have been addressing them.

[Dr Drew]

The problem is that those who might have come here in the future will not do so and we are now into the second year in which they would have been making such arrangements. What inducement is there for someone to come here, when effectively they have been told for two successive years they are not wanted, rather than go to other parts of Europe, as they are now?

[George Eustice]

There are anecdotal reports that more have come back this year because of recent changes in the exchange rate. Some daffodil producers in the west country say that it was easier to get labour this winter than last. It is quite common for seasonal agricultural workers to return for a number of years, and indeed levels of returning are one of the yardsticks used to assess the availability of labour.

The hon. Member for Bristol East (Kerry McCarthy) posed a question in an intervention about rules of origin. The Government are looking at that area. Obviously, not every nation state in the world is a member of the European Union. Lots of countries are not, and they have quite established procedures on rules of origin. While we have not reached a final position on those issues, there is, for instance, the pan-Euro-Mediterranean regional convention, which is a rules of origin system covering countries both in and not in the European Union. Other parts of the world have therefore addressed such issues.

I turn to points raised by the shadow Minister, who asked about how we are approaching the WTO. We have been clear that our schedule of tariff rate quotas on agricultural products should be divided between the EU and the UK based on an historical reference period. We regard that as a matter of technical rectification rather than reopening everything for renegotiation, and that is the approach we are taking on existing TRQs.

The hon. Gentleman mentioned New Zealand lamb and pointed out that we have a TRQ of just short of 250,000 tonnes for lamb from New Zealand coming into the UK. It is also important to recognise that, in recent years, New Zealand has only ever used about 70% of its quota. That demonstrates that long before the ceiling of that tariff rate quota is hit, they find themselves unable to compete with UK producers. I am more optimistic than some about British sheep producers’ ability to compete with New Zealand and Australia. Many do so already. As a country, we should not get spooked by some kind of New Zealand haka on lamb production. We need to get on the pitch and play, and I think we will find that we can beat them.

We have been clear that in any future trade agreements we will maintain our standards. We will not reduce our standards in pursuit of a trade deal. That is a common feature. It is quite possible for us, through doing trade deals with third countries, to require that those who wish to supply us under such agreements must meet our standards.

Just this morning, I visited the Agriculture and Horticulture Development Board and talked to officials who were involved in our negotiations with the United States on reopening its market for British beef, which we have worked on for a number of years. There are opportunities for British beef exports to the United States, but there are also one or two technical areas where the United States wants us to change our rules for those supplying them to meet their standards. For instance, they have a slightly different approach to monitoring things such as E. coli and to the methodology that a vet should use when visually inspecting animals as they arrive in the pen.

We could go in and say, “This is no good. You’ve got to change your rules to be like the British rules,” but we do not. Actually, we say, “Fair enough. Those suppliers who want to supply that market should do that. We should respect their rules, and they should respect ours.” Equally, if US producers want to supply the British market, it is absolutely open to us to say that that must be done on British standards. We are a free-trading country, and we will be open to doing trade deals, but we are clear that we have standards and values that we will not abandon.

Oral Answers to Questions

Debate between George Eustice and David Drew

Thursday 7th June 2018 Commons Chamber

[George Eustice]

As the hon. Gentleman knows, I spent 10 years working in the soft fruit industry and I understand the issue of labour in some detail. We are having discussions with the Home Office and other parts of Government about the future arrangements for immigration and a seasonal agricultural workers scheme.

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

In the responses to “Health and Harmony”, the two areas of greatest concern were the impact of the withdrawal of the basic payments scheme on smaller farmers and tenant farmers, and the transition period. What discussions has the Minister had with the Treasury about extending the transition period, given that that must be the right way to approach this?

[George Eustice]

My right hon. Friend the Secretary of State spoke to the Chief Secretary to the Treasury about these issues just a couple of days ago. We made a clear manifesto commitment to protect spending on agriculture until 2022—the end of this Parliament. Thereafter we will have a new funded policy.

Sale of Puppies

Debate between George Eustice and David Drew

Monday 21st May 2018 Westminster Hall

[George Eustice]

We have made it clear that our intention is to raise the maximum penalty for animal cruelty offences—the most sickening offences that take place—to five years. As part of our work on that, we will of course want to look at the approach taken by other parts of the UK and any lessons we might be able to learn from that.

We published a draft Bill in December. It will allow the courts to set realistic sentences for the extreme cases of animal cruelty that I know sicken all right-minded people, including every Member participating in this debate. We will seek an appropriate opportunity to bring forward the legislation to make that change.

I want to touch briefly on another contentious issue, which is the use of electronic training collars for dogs and cats. This is another area where we have been doing some work. We have recently completed a public consultation on a proposal to ban the use of such devices. It closed on 27 April, and we received around 7,500 responses, which we are analysing. There was a very high response rate, and the consultation sparked passionate views on both sides of the containment fence. We will consider those representations and announce further steps in due course.

[Dr Drew]

A number of Members talked about education. Will DEFRA launch an education programme to explain to the public that they should buy puppies only through licensed breeders? I know it is a very small part of the overall supply of puppies, but that would be a simple thing for DEFRA to do, although it may cost money. Will the Minister say whether that is something it will do?

[George Eustice]

We publicise any way we can the existing regulations, including the guidance that people should see puppies with their mother before purchasing them. That is long-standing DEFRA guidance. About two years ago, I had a discussion with some of the pet food manufacturers to try to persuade them that they should add this guidance to some of their packaging so that people who were considering buying pets would be reminded of it. I could not get the manufacturers to take up my suggestion, but it was worth a try. The hon. Gentleman makes a good point. If we introduced a change in the law, we would ensure we did everything we could to publicise that.

Finally on enforcement—a number of Members raised the issue—we have provided in our new licensing conditions for local authorities to be able to go for full cost recovery to fund their work in this area. While the internet provides many challenges, it also provides a relatively easy way to identify people selling pets in the UK who are not legally entitled to do so.

Draft Mandatory Use Of Closed Circuit Television In Slaughterhouses (England) Regulations 2018

Debate between George Eustice and David Drew

Monday 30th April 2018 General Committees

[George Eustice]

I shall try to cover as many points as possible. I am grateful for the support of the shadow Minister, the hon. Member for Stroud, on the regulations. There has truly been cross-party support on this issue for a number of years. I want to address some of the legitimate concerns that he raised, on which I think I shall be able to give him the reassurance he wants.

First, we are absolutely clear that the introduction of CCTV in slaughterhouses is not a replacement for the current inspection regime. It does not mean we are going to change the requirement for full-time official veterinarians on hand in the abattoirs. We are not planning to change any of the existing requirements. The CCTV is in addition to, rather than a replacement for, OVs and other inspections.

The hon. Gentleman raised the issue of cost. Like him, I would not want to damage some of the smaller abattoirs, whose existence means animals do not have to travel so far. If we close down more abattoirs, more animals will have to travel further. However, the cost is quite modest: the cost of CCTV systems has been coming down a lot in recent years. We estimate that the average cost for most smaller abattoirs will be in the region of £2,500. As I said in my opening remarks, we do not envisage paying the cost directly, because it is fairly modest even for small abattoirs.

The other thing to notice is that, as the report by FAWC identified, there are commercial benefits for food business operators in having CCTV in place, because it can help them to manage their lairage facilities. For instance, in its report FAWC highlighted the fact that it is easier to spot lameness or other problems in sheep with CCTV than when someone comes and perhaps spooks the animals. We believe there are advantages and cost savings to small businesses from putting in CCTV.

The hon. Gentleman highlighted the work that organisations such as Animal Aid have done. I agree with him. In fact, one thing that a couple of years ago made me determined to make changes was that I frankly did not think it was good enough that we seemed all too often to have to rely on activists making surreptitious recordings. After the event we would inspect and carry out enforcement on the basis of the footage that had been surreptitiously collected. That is not the right way to run things. If it is the case that some of our official veterinarians were unable to spot bad practice and malpractice in those abattoirs, it is right that we make it a legal requirement to have CCTV in slaughterhouses.

The hon. Gentleman asked why we believe it is necessary to require this of all abattoirs, given that, as I said in my opening remarks, some 95% of animals are currently slaughtered in abattoirs that have CCTV. For me, there are a couple of reasons why we need to do that. First, some of the problems we have experienced are in those smaller or medium-sized abattoirs that do not always have CCTV in place. Secondly, the larger abattoirs tend to have it, but even in the larger abattoirs we have seen problems. The hon. Member for Bristol East raised a couple of cases where enforcements were brought; in those cases, sometimes there was CCTV in place but they were not adequately monitoring it or recording all areas, so even with CCTV they were not picking up those problems. Therefore, having legal clarity about CCTV covering all areas where there are live animals is the right approach to take.

The hon. Member for Stroud highlighted the fact that, of all the responses, only a small number were from the industry. To be fair to the industry, as he pointed out, we have lost a lot of abattoirs, so they are small in number, and we had thousands of responses to the consultation because it is an issue the public care about deeply. My conversations with the industry and representative bodies on this issue have shown that their view has broadly come round to the idea. Rather than have voluntary codes and chivvy people to join such schemes and voluntarily adopt CCTV, the industry has increasingly got to the point where it would rather have a level playing field and, if we want to bring in regulations, have them applied across the board so that everybody is treated the same. It is fair to say that the industry recognises that there could be some value in this and that there is an advantage in having a level playing field.

The hon. Gentleman asked about the difference between abattoirs and slaughterhouses. I was not aware of that distinction, but I will check. However, I am reliably informed by my officials that in law, commercial slaughterhouses and abattoirs are interchangeable terms. In most of the EU regulations that I see, the term slaughterhouse tends to be used, and in some of the older domestic legislation the term abattoir is sometimes used, but these regulations apply to all commercial slaughterhouses or abattoirs.

The hon. Gentleman asked where cameras will be placed. We have deliberately kept that open, for the important reason that a small abattoir, killing a small number of animals, might be able to cover all areas where there are live animals with just a couple of cameras. A larger abattoir, slaughtering thousands and thousands of animals per day, may need multiple cameras to ensure it is covering all areas. We are clear that it will need to cover all areas, including unloading areas, areas where there is lairage, areas where stunning takes place and the bleed areas. Right up until the point that the animal is dead, there must be a clear CCTV recording.

The hon. Gentleman asked who will decide where the cameras should be placed. The FSA is currently working with the Department to put together guidance on that. Ultimately, the Food Standards Agency and the official veterinarians employed by the FSA in each abattoir will be the final adjudicators on where cameras should go. We envisage it being a discussion with the food business operator, which will need to satisfy the local FSA inspector that the areas where it plans to locate cameras are adequate to satisfy the legislation.

[Dr Drew]

The Minister has visited slaughterhouses, as I have, so he knows it is not an easy job. If there is a dispute, will the final say-so be with the FSA or DEFRA?

[George Eustice]

We have designed it in such a way that we will trust the FSA official veterinarian to make that final judgment call and to ensure that the abattoirs that they are responsible for inspecting comply with the legislation. Will I potentially end up with letters from people complaining? Quite possibly. Will I have to get involved? Quite likely. But the intention is that the FSA OVs will lead on that.

The hon. Gentleman asked who would be responsible for inspecting the recordings. Again, that will be the official veterinarians. He referred to local authorities, but it is important to recognise that the FSA is responsible for food safety policy and, in abattoirs, also responsible for enforcing animal welfare policy, although it is not responsible for animal welfare policy. So DEFRA is responsible for animal welfare policy, but the FSA is responsible for implementing in the abattoirs the policy that we set for it.

The hon. Gentleman asked about public access. We do not intend there to be public access to the recordings. I shall explain why. The Farm Animal Welfare Committee looked at the issue in depth and made a very sensible point: used properly, CCTV in slaughterhouses can be an important aid to food business operators. He made the point that a job in an abattoir is not an easy one, and sometimes things go wrong. Most of the time when things go wrong, it is not deliberate—sometimes errors are made. The argument made by FAWC therefore is that we need to create a space where those recordings can be used to help educate and train staff and to pull people up where mistakes might have been made. It might not always be appropriate for that to be publicly available or for there to be a prosecution in every instance.

The hon. Gentleman asked about religious slaughter and slaughterhouses engaged in that. I confirm that yes, the requirements in the draft regulations will apply to religious slaughter, just as they will to any slaughterhouse. There is no exemption for religious slaughter when it comes to the requirement to have CCTV. That is important to enforce existing provisions in national legislation on things such as standstill times and the additional requirements for animals slaughtered in accordance with religious requirements.

The hon. Member for Stroud also asked who will enforce the provision that recordings be kept for 90 days. Again, we will expect that of the official veterinarians. They are full time in the slaughterhouses, and we believe that they can enforce that provision because if they are there every day, they would have a pretty good idea if recordings started to go missing or there were any type of fraud.

The hon. Gentleman asked finally about CCTV after slaughter, but the purpose of the draft regulations is narrow: to protect animal welfare. He is right that there have been some instances in the news recently of wider problems and other types of food fraud being committed, but we have introduced these regulations to protect animal welfare.

I now turn briefly to some of the points made by the hon. Member for Bristol East. She talked about her concern that things were not always followed up and that there is not always enforcement. I would say, however, that just because decisions are made not to withdraw an operator’s licence, that does not mean that action has not been taken. Indeed, the WATOK regulations, which govern the welfare of animals at the time of killing, create the powers—though we had similar provisions under the Welfare of Animals (Slaughter or Killing) Regulations 1995—to issue stop notices, for example, so an OV can stop a line or any production until something is sorted out. We also take regular action to reduce or remove the licences of individual slaughtermen, where there has been abuse, although we might stop short of reducing or removing the operator’s licence. Other facilities such as improvement notices and so on are also included under the WATOK regulations. Lots can be done short of closing a facility down, which is obviously a severe sanction that we rightly reserve for those activities with which we have the greatest problem.

The hon. Lady mentioned the development in the United States of—as she put it—high-speed slaughter. We have a very different animal welfare culture in the UK from the US, and we have been absolutely clear that we will not reduce our animal welfare standards—far from it; indeed, we would like to enhance them. We are working with a number of organisations on issues such as improving the slaughter of pigs, in particular the gas mixture used, and we have no intention of taking the US route.

On EU nationals, finally, the hon. Lady is right: we have a lot of EU nationals in our slaughterhouses. The Prime Minister has been very clear that we will protect the rights of those who are here and, as a number of hon. Members will know, the Migration Advisory Committee is looking closely at our labour needs after we leave the EU.

Question put and agreed to.

Resolved,

That the Committee has considered the draft Mandatory Use of Closed Circuit Television in Slaughterhouses (England) Regulations 2018.

Oral Answers to Questions

Debate between George Eustice and David Drew

Thursday 26th April 2018 Commons Chamber

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

Thank you, Mr Speaker.

The overwhelming response of farmers to the consultation is that they want to know what help and advice they will get in managing the change from the basic payment to environmental support. As the Minister knows, that is particularly true of smaller and tenant farmers. What will the Government do to put in place some form of advice strategy so that those people can get independent, objective and, more particularly, comprehensive advice about how to completely change many of the ways in which they have farmed in the past?

[George Eustice]

We will look at that issue, but fundamentally we have been clear that we recognise the current dependency on the existing basic payment scheme—the area payments. That is why we have set out a plan for an agricultural transition period to give farmers, especially those on our smaller family farms, plenty of time to prepare. Our new environmental land management scheme, when published, will have plenty of guidance alongside it.

Oral Answers to Questions

Debate between George Eustice and David Drew

Thursday 8th March 2018 Commons Chamber

[George Eustice]

I do not accept that there was no change. As I said a little earlier, we have announced a package of measures. It includes a £10 million collaboration fund to help farmers and small producers to come together, compulsory milk contracts legislation to protect dairy farmers, compulsory sheep carcase classification, a commitment to making supply chain data easier to access to improve transparency and market integrity and a commitment to reviewing whether more grocery retailers should come under the GCA’s remit.

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

I hear what the Minister says, but given that the vast majority of producers and consumers are very keen for the Groceries Code Adjudicator to be strengthened, why will he not do so? The Opposition are very happy to help if he says that he is prepared to strengthen the code.

Oral Answers to Questions

Debate between George Eustice and David Drew

Thursday 26th October 2017 Commons Chamber

[George Eustice]

The basis for the roll-out of the cull was the randomised badger culling trials carried out under the previous Labour Government. Those trials showed that there would be a reduction in the disease through a badger cull. Indeed, research carried out earlier this summer by Christl Donnelly has confirmed that there is a 58% reduction in the disease in cattle in Gloucester and a 21% reduction in Somerset. That is within the range we would expect, based on the RBCTs.

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

rose—

[Dr Drew]

Thank you, Mr Speaker. I think I can dine out on that for a few more days.

I hear what the Minister says, but now that the culls are coming to an end, it is estimated that between 20,000 and 33,000 badgers were caught and dispatched in the roll-out. Is he seriously telling me that we will not test a significant proportion of those badgers so that we can at least have some scientific efficacy and know that there is some sense in what the Government are trying to do, even though Labour Members totally oppose it?

[George Eustice]

If the hon. Gentleman had listened to my earlier answer, he would know that I said precisely that we want to monitor trends in this disease, which is why we are starting to collect and test a sample of badgers to develop these protocols. A lot of post-mortem analysis was done during the RBCTs, and we know from that—it was not conclusive—that the typical prevalence rate of the disease in the badger population in the high-risk area is 30%.

Oral Answers to Questions

Debate between George Eustice and David Drew

Thursday 20th July 2017 Commons Chamber

[George Eustice]

My hon. Friend is absolutely right. We made it clear in our manifesto that we want to open new markets and to produce more and export more great British food from this country. He cites some great examples from his own constituency. We continue to press hard to open new markets and create new opportunities.

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

The Secretary of State said earlier that he was not in favour of mega-farms, yet there has been a 26% increase in the history of this Government. This has an effect not only on food security, animal welfare and food standards, but on the structure of our British farms, including the future of tenant farms. What will the Minister say to tenant farmers about their security after Brexit?

[George Eustice]

I had a meeting with the Tenancy Reform Industry Group just a couple of weeks ago, where we discussed in detail the issue of tenancy law, including whether we could review the workings of existing farm business tenancies and whether we could do more to encourage models such as contract farming, share farming and franchise farming to create new opportunities for new entrants.