Exiting the European Union (Agriculture)

Jim Shannon Excerpts

Tuesday 1st October 2019 Commons Chamber

[Jim Shannon (Strangford) (DUP)]

First, let me thank the Minister for bringing this measure forward. In his introduction, he said that powdered milk was one of the products he is referring to. My constituency has a large number of agrifood companies, which depend on their export and important licences. One of them is Lakeland Dairies, which employs some 270 people in my constituency and is involved in the milk product coming in as a liquid. It has two factories in Northern Ireland and two in the Republic of Ireland—the company is in a unique position. I am encouraged by what its chief executive officer, Michael Hanley, has said, which is that whatever happens in this process of Brexit, be it a deal or no deal, we have to work with it. I am glad when the CEO of a major company has that attitude and that interpretation of what is happening.

Along with the approximately 2,500 agrifood sector jobs in Mash Direct, Rich Sauces and Willowbrook Foods, my area also has a number of farmers who feed into the process. I wish to talk particularly about the farmers who feed into Lakeland Dairies. Mine is the second-highest milk-producing area in the whole of Northern Ireland—second only to East Antrim—and we have a high-quality product and a number of committed farmers. I declare an interest: I live on a farm. It is not a milking farm—it is not a dairy farm—but my next-door neighbour takes the land and milks it, and I suppose that is ultimately used for dairy. My neighbours depend on the process being easy to take forward. The milk product provided by Lakeland Dairies comes across the border, the powdered milk goes back across the border to the Republic of Ireland, and it then comes across once more in a processed form, because of the way the factories do it down south. Ultimately, the product is packaged in Newtownards in my Strangford constituency and then sent overseas.

The former Minister for exports, Liam Fox—I cannot remember his constituency—was responsible for ensuring the export of the product from Northern Ireland, and ultimately from the Republic of Ireland as well, to China. He secured a contract for £250 million over five years. We are eternally grateful to him and his Department for ensuring that that happened, but I want to make sure that everything goes forward in the right way.

Earlier, the Minister said—I think I caught what he said correctly—that his Department had contacted the regional Governments. Unfortunately, we do not have a functioning Assembly; I presume that contact was made with the Department of Agriculture, Environment and Rural Affairs, which is the equivalent of DEFRA over here. Has that contact been made, and has contact been made with the Ulster Farmers’ Union, which represents the majority of the milk producers throughout Northern Ireland? Indeed, has contact been made with the likes of Lakeland Dairies and others that depend on the powdered product and the milk product that cross the border on a number of occasions? They are high-quality, great products.

Finally, with special reference to daily export, is the Minister aware of the onerous added administrative burden? Is there not only support but funding to help with an interim change over a period? My local company has a number of questions, and I have written to the Department. To be fair, I think the Minister met the company—indeed, I remember the day that he did—on a separate occasion when he had a different responsibility. I just want to make sure that Lakeland Dairies, an integral economic factor of progress in my constituency of Strangford, can retain the jobs it has. We need to ensure that the milk producers can feed into the process and that, when it comes to import and export licence regulation and those companies that create so many jobs and so much in the economy, we can make my constituency of Strangford a stronger economic base for that, so that everything will be in place for them.

[Mr Deputy Speaker (Sir Lindsay Hoyle)]

For the record, the constitutency was North Somerset.

[George Eustice]

Let me turn first to the points made by the shadow Minister. He highlighted the use in the explanatory memorandum of the term “fixes”, which he even put in quotes marks. In DEFRA, we like to fix things that are broken, and the truth is that in this case, as in many other cases, it was always recognised that simply to bring across retained EU law would require changes for the purposes of operability. The types of fixes that are commonplace throughout this instrument and all the others simply replace the words “European Union” with “UK” or replace the European Commission as the competent authority with the relevant authority in the UK or with the Secretary of State.

The shadow Minister mentioned the issue of export refunds for dairy, which links to a point that was made by the hon. Member for Strangford (Jim Shannon). Let me say that, when it comes to these export refunds, we are simply deleting provisions that have already disappeared from EU law, so we are revoking something that became redundant and obsolete anyway under EU law in—I think—2007.

EU thinking on export refunds has evolved in recent years. There is a general consensus that they can be used only in extreme circumstances—when there is a particular crisis—and there are other provisions in law to enable that to happen. Therefore, they would not be able to be used anyway, because the other associated legislation that would enable us to do that does not exist, so this measure is really little more than a good housekeeping measure.

The point raised by the hon. Member for Strangford goes somewhat beyond the scope of the measure, but I will touch on it briefly. Let me reassure him that the Government are absolutely fully aware of the problems that the Northern Ireland dairy industry in particular could experience in a no-deal scenario. It is the case that it exports around 30% of its liquid milk to be processed in Ireland. That would be a problem if there were a requirement for export health certificates, or, indeed, if full tariffs were applied. It would also be a problem for those cheese processers in the Irish Republic, who would no longer have their supply of milk. Obviously, we hope that this is something that can be resolved through negotiation, but I can reassure him that we are working very closely with DAERA in Northern Ireland to identify all sorts of contingency arrangements and interventions that we would instigate if they were required.

[Jim Shannon]

I thank the Minister for that explanation and for all the hard work that he does in his Department. It is good to see him in his place doing things that he did in the past and doing them well. It is important that the Republic of Ireland is aware very clearly of the benefits of having a good working relationship with Northern Ireland in the United Kingdom. It is for the mutual benefit of everyone: for the mutual benefit of the other producers; for the mutual benefit of the factories; and for the mutual benefit of the workers.

[George Eustice]

I could not agree more. There is a mutual interest for all EU members and the UK to reach a sensible resolution to the current discussions. That is why the Government are redoubling their efforts to try to get a sensible withdrawal agreement with that backstop deleted and alternative arrangements put in place instead.

I turn now to the point raised by the hon. Member for Edinburgh North and Leith (Deidre Brock), which also links to a point raised by my right hon. Friend the Member for East Yorkshire (Sir Greg Knight). I am aware that my right hon. Friend has raised with me this issue of cost recovery and charges in a different context, which I am looking into. However, in this particular context, I can confirm that it is licence security that is offered, and it is returned once a licence is utilised within the specified criteria. There are no costs to operators if they use the licence as specified and therefore no economic implications. The hon. Lady should be aware that the impact assessment highlights the fact that any costs would be well below the threshold of £5 million, but I hope that, in this additional information, we are talking here about a licence security that is returned. She must also bear in mind that we are doing nothing that is not already currently done. As I know that she and others would ideally like us to remain in the European Union, she would face those costs anyway. We would be forced to have those costs and would never have the chance to be able to repeal them should she want to. We, at least, as a country about to become a properly independent, self-governing country again, would have the opportunity, at a future date, if we felt it necessary, to repeal these particular provisions and save everybody the bother.

I hope that I have been able to address the points that have been raised, and I commend these regulations.

Question put and agreed to.