Agriculture Bill (Third sitting)

Kerry McCarthy Excerpts

Thursday 25th October 2018 Public Bill Committees

[Nigel Huddleston (Mid Worcestershire) (Con)]

Q Mr Ward, I represent the Vale of Evesham, so many of the producers in my constituency are members of your association. We, of course, produce the best asparagus and tomatoes in the world—sorry, Sir Roger, I am going off topic there, but the legislation is hugely important for many of my constituents.

You have mentioned that overall you welcome the Bill, but you have both said that the devil is in the detail. What specific improvements would you like to see in terms of the relationships between Government and the producer organisations? Secondly, you talked about the supply chain and the imbalance between primary producers and the large distribution processes. What specifically would you like to see change? Improved data, information flow and transparency have been talked about, but how would that improve things?

Jack Ward: In terms of the producer organisation, going forward, first we want a single scheme if we can possibly achieve it so that we have a common scheme in all the devolved areas, so that we have not got a different scheme in Scotland from the one that we have in the UK. Within the producer organisations, if you take soft fruit, there is a massive amount of production in Scotland and a lot of them are members of English-based POs. That is really important.

We want the principle of match funding to continue. That has been a really valuable part of it—the idea that the farmer or grower puts in £1 and the taxpayer puts in £1. That binds the two together in a common aim, which is really important. We want a fairly thorough review of the scheme. We need to get into the nuts and bolts of it and cut out the superfluous bits. From conversations with the Rural Payments Agency, it knows as well as we do where all the wrinkles are, so there is a meeting of minds there. We want more flexibility around the way the money can be invested. Sometimes, it is too restrictive and gets in the way of making sensible things, rather than having to spread it across several different areas.

The other thing is to make it more UK-centric. At the moment, it is set up for a southern European production-marketing model. As I have said, we deal with nine customers, and they operate in a very different way from the rest of the EU. We are constantly in a position where we are looking over our shoulder and second guessing how the EU might interpret what we are doing in the UK. We are worried. The RPA is worried. We need to deal with that.

In terms of supply chain fairness, there needs to be a better meeting of minds between retailers and producers. I will give you a simple example. At the moment, we are right in the middle of the English apple season, but we are overwhelmed with southern hemisphere fruit that has been over-bought and is dominating the market—and probably will until Christmas. We have mountains of fruit that needs to move, and yet there is all that southern hemisphere fruit. Eventually, that cascades into difficult conversations between suppliers and retailers. Often, it is about more clarity between the two sides, so we understand what is going on and how we can make the system work better.

Helen Browning: If I can come in on that, I welcome the focus on the relationship between the farmer and the first buyer of produce. We often pin all the woes of the world on to the retailers, but most farmers and producers deal with a processor, not a retailer. Historically, there is a blame game that goes on in that relationship. The processor will blame the retailer, the retailer will blame the processor, and it will all start to shift up and down the chain. In my experience, the processors, many of which are very large businesses, have often not been keen on farmer co-operation, unless it is their own supply chain. If we are going to encourage more farmers to get their act together, market well, grow and plan, we need that relationship to work better and that collaboration to be welcomed by the processors and not crushed, as has often happened in the past.

[Kerry McCarthy]

Q (Bristol East) (Lab): It is good to see the British Growers Association here, because yesterday, in the Environment, Food and Rural Affairs Committee, which is also taking evidence on the Bill, we had representatives from the dairy sector, the red meat sector and the ornamental horticulture sector, which was slightly odd, because the answer to whether they should be covered by the Groceries Code Adjudicator was mostly, “No, we don’t care about that”—well, of course they do not, because they are not grocers. There was an obvious gap with you not there.

I have tabled an amendment on public health, which I hope that you will welcome. It talks about measures to increase the availability, affordability, diversity, quality and marketing of fruit and vegetables. It also talks about pesticide use and antimicrobial resistance—the overuse of antibiotics. Some environmental organisations have said that they do not support the public health goal. I wonder whether we could do more, other than putting it in as a public good, particularly around procurement. In France, for example, there is a rule that 50% of public procurement should be locally sourced or organic produce. Could we do more on that front in the Bill?

Jack Ward: There is a fairly urgent need to promote the consumption of fresh fruit and vegetables—that is a given. It would be incredibly helpful to have something in the Bill that enabled us to do that, although I am not quite sure where responsibility ends for DEFRA and begins for the Department of Health and Social Care. Within the industry, there is certainly a lot of interest in how to extend the message about health and vegetable consumption.

[Kerry McCarthy]

Q It has been said that since anything can happen to food during processing, why reward it at the produce stage? That is what I am trying to get to grips with. Fruit and veg are incredibly healthy, but how do we ensure that they reach the consumer in a healthy form without being adulterated or turned into something with very little nutritional value?

Helen Browning: That is why we need to look at this alongside the food plan, if that is coming through. The two things need to work together. We need to grow a much wider diversity of fruits, nuts, vegetables and other crops on our farms; we can expand the diversity of what we do; dietary diversity is a big factor, because we eat far too much of far too few things. However, it needs to be married with the market pull end, which is achieved through things like public procurement. We need to ensure that food is not being ultra-processed. Otherwise, however good it was at the start, it will not be very good by the time it gets to our plates.

I want us to look at the whole picture, because at the moment we are only looking at part of it. We want to see health addressed in the Bill, because we are not seeing it being addressed anywhere else. If we had an absolute assurance that it would be dealt with in other places, and that we were looking at a farming future based on public health, we would not be lobbying quite so hard for it in this place.

[Kerry McCarthy]

Q May I also ask about whole farm systems? I have an amendment that relates particularly to agro-ecological and organic farming, which I am sure the Soil Association would support. You mentioned the concern that the approach might be piecemeal, with people doing things round the edges. How important is it to support a whole farming system, as opposed to focusing on individual public goods?

Helen Browning: In my view, whole farming systems such as organic farming or agroforestry are probably the most efficient way to support the public goods that we want, because they actually deliver them as an inherent part of the food production system. That is why I have been an organic farmer all my life: I do not want to be farming intensively in one place and trying to produce public goods in another. The integrated approach gives us a balance of food production with environmental care. We will still need to do special things in special places so that we can preserve species, manage floods and so on, but the agro-ecological approach should be at the core of our farming system. We know that we need to start moving away from pesticides and antibiotic use, and towards encouraging rotations and using less manufactured nitrogen.

I welcome the steer on climate change, which is incredibly important. We need to soak up more carbon in our soils and in our trees. We need farming systems that deliver those things, but at the moment that is not coming through strongly enough. It will be financially and physically the most practical way to do it, and it will give people a vision of the future that we can all sign up to. A drive towards using the new technology coming through, as well as traditional techniques, would feel really exciting.

[Colin Clark]

Q I declare an interest: I am a conventional farmer and an organic farmer, and I own fresh produce factories. I have been involved in farming for donkeys’ years.

Part 6 of the Bill is about fairness in the supply chain. Several retailers have moved to central direct buying, reducing the role of packers to, effectively, contract packers. That has been part of the problem with the oversupply of apples this year. The industry is already changing: instead of producer organisations having 12 months’ integrated supply, the supermarkets are now trying to do it themselves. How will the Bill rebalance that? If you do try to rebalance it, you must maintain the natural effect of the market—how else will you control supply? What does the Bill actually do to give real powers of fairness between the power of the supermarkets, where they are already squeezing out the existing supply chain?

Jack Ward: Growers understand that they are operating in a very competitive market and that is the way the world goes. We also have to recognise that we only supply for a part of the year. For growers, with the exception of one or two crops, it is a seasonal operation. Some growers are growing overseas and filling that gap. Generally they understand exactly how the supply chain works. I think I am right in saying that the Minister is charged with developing something around supply-chain fairness in the future. I think it is just about getting a better understanding between the two sides about what supermarkets need and what growers can supply.

This year has been a good case in point. We have been through a really difficult growing season with a very cold start and then a very dry middle period. It took quite a long time before people appreciated that what was coming off the farms would be different from a normal year, as a result of those weather conditions. It is about getting that understanding, acceptance and realisation that things might be different. You are not producing off a spreadsheet. Even if your spreadsheet says you will get x volume of y specification at z price, the season can interrupt that. There needs to be a grown-up discussion about how to accommodate that, rather than buyers turning their backs and saying, “Okay, we will have it in from America,” or wherever.

Helen Browning: I will just add a bit more to that. There is also a need in the wider industry for a real culture change around co-operation and how we work together, both through the supply chain and between producers themselves. In some areas, we have better integration and better co-operative working. In the “Health and Harmony” document, the co-op that I belong to—the Organic Milk Suppliers Co-operative—was cited as a very good case study, and that is absolutely right. Differentiating markets, being very clear of our purpose, being inventive and entrepreneurial, and working well in partnership will all stand us in good stead.

There is a real need to look at transparency and information clarity, which we have already talked about a bit today. I also want to mention the opportunity to shorten supply chains and create new markets through investing in the kind of infrastructure that we need, in order to allow farmers and growers to deal more directly with the consumers themselves. We need to do that efficiently, so that we do not end up with white vans and lots of capital investment on every farm. But I think there are ways of doing that through processing hubs and good distribution networks, and that could be revolutionary in ensuring that fresh food is available affordably and does not always have to go through the normal retail chains.