Subsidiarity Assessment: Food Distribution (EUC Report)

Lord Henley Excerpts

Wednesday 3rd November 2010 Lords Chamber

[The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Lord Henley)]

My Lords, I join other noble Lords in saying how grateful I am to both the noble Lord, Lord Roper, as chairman of the EU Committee and to the noble Lord, Lord Carter of Coles, as chairman of Sub-Committee D, for this report. I make it quite clear at once, as I think our Explanatory Memorandum made it clear, that the Government share the committee’s concern that the regulation concerned is not consistent with the subsidiarity principle. That means that much of what I say may repeat what other noble Lords have said this afternoon, because there has been general agreement around the Chamber. Still, it is important that it is on the record that these are the views of Her Majesty’s Government.

As the noble Lord, Lord Roper, made clear, the then European Community’s food distribution programme was introduced back in 1987 and its main aim was to help run down the stockpiles of basic commodities that had been purchased into intervention stores under the common agricultural policy. The noble Lord, Lord Roper, went on to stress that it was the stocks of butter, milk powder, beef, sugar, rice, all those mountains and lakes that we remember—I cannot remember whether it covered wine lakes, but it did cover a whole variety of mountains and lakes—that were released to charitable organisations in participating member states annually to distribute to poorer sections of the community.

As has been made clear by a number of noble Lords, we in the United Kingdom last participated in the scheme in 1998—everyone referred just to the mid-1990s, but I can give the precise date. We withdrew both because of the sharp decline in intervention stocks in this country and because of the high administrative overheads, for government and charitable organisations alike, which made participation unattractive. I assure the noble Baroness, Lady Quin, that we still believe that, under the scheme that is being looked at at the moment, there would still be high administrative burdens, which would make it unattractive. I also assure her that we are not aware of any charitable organisations having asked us to participate in this scheme, or, for that matter, to go back into the scheme after the withdrawal by the previous Administration back in 1998.

The main purpose of intervention systems, as my noble friend Lord Caithness and other noble Lords made clear, is to support market prices. However, a side-effect—in practice, it turns out to be the dominant effect—is to encourage overproduction and distract farmers from making market-based production decisions. Successive reforms of the CAP have reduced the role of intervention and, together with improvements in world commodity markets, have resulted in significantly reduced EU intervention stocks. Consequently, the Commission proposes to adapt the scheme.

The main stated purposes of the Commission’s proposals are to align the legislation to the Lisbon treaty and to modernise the scheme. The CAP is now more market-orientated and price support will play less of a role in future, so, as I have said, the accumulation of large intervention stocks is less likely. The proposal therefore provides for CAP funds to be used to purchase goods on the open market and for a wider range of goods to be purchased by participating member states on the basis of nutritional criteria rather than limiting them to the products for which intervention applies. The other major change is the proposed introduction to the scheme of cofinancing by participating member states. Under current proposals, this will be a minimum of 25 per cent of the eligible costs, with lower ranges of cofinancing, such as 10 per cent, applying to more disadvantaged areas of the European Community.

As before, participation in the new scheme—I think the noble Lord, Lord Roper, made this clear—will remain voluntary, so that, even if it goes ahead, the United Kingdom will not be obliged to participate. Providing effective help to disadvantaged people is clearly an important objective, but, as the Explanatory Memorandum explains, we remain unconvinced of the merits or the appropriateness of the proposal. In particular, we believe that the expansion of the scheme to procuring goods on the open market will mean that the new scheme is essentially a social measure—that is an assurance I can give to my noble friend Lord Caithness—which, by its design, would make it a matter for member states to decide rather than for the EU itself.

In accordance with the principle of subsidiarity, a longstanding element of European treaties that is currently enshrined in Article 5 of the treaty on the European Union, the Government consider that the EU should act collectively only where there are clear additional benefits, or EU added value, compared with action by member states either individually or in co-operation.

We consider that social matters are a matter for individual member states, and that measures to assist the neediest members of society are more properly and efficiently delivered through domestic social programmes that take account of the prevailing situation and available funding in individual countries. The noble Lord, Lord Carter of Coles, for example, mentioned a scheme, Healthy Start, which is run by the Department of Health. I assure him that that scheme is still there; it is under review by the department and subject to a consultation about various changes in it.

I would like to mention national charitable organisations, such as FairShare. I visited one example of its outlets in the north-east, not far from the former constituency of the noble Baroness, Lady Quin. Many noble Lords will know of the valuable work that bodies such as FairShare can do in distributing food to the less advantaged. To return to the north-east, I was grateful for what the noble Baroness, Lady Howarth, said about the north-east food action programme. It is those kinds of measures—national from the Government, from local government and from charities—that we believe we should be looking to work. I commend those bodies to those who do not know about the sort of work that they do.

The proposal itself was discussed in the Agriculture and Fisheries Council on 27 September. That was followed, as I understand it, by technical consideration by officials. A number of policy and technical issues have been identified. At present—I give this assurance to my noble friend Lord Caithness—there is no qualified majority in favour of it. There might be a blocking minority against, but certainly I assure him that no member state at the moment actually supports the scheme; some oppose it for one reason, some for another. Also, as I understand it, the European Parliament has not yet given its opinion on the proposal.

The noble Baroness, Lady Quin, asked about the timescale. I assure her that we still have quite a long way to go before we get to any final decision, what with the European Parliament having to consider it and some sort of qualified majority having to be found on the Council, which does not seem likely.

In addition to subsidiarity, there are two main concerns among those member states. First there is the legal base.

[Baroness Quin]

I thought that the proposal reflected some of the amendments that had been passed in the European Parliament, so I am somewhat puzzled that the Minister says that the European Parliament has not considered it.

[Lord Henley]

As I understand it, the European Parliament has not yet considered the stage that we are currently at. It might be that it considered earlier examples of it. At the moment we are at the stage where it has been through the Agriculture and Fisheries Council, which talked in September about co-financing at the 25 per cent or 10 per cent level, but that has not yet gone on to the European Parliament. If I am wrong, I will write to the noble Baroness to correct it. My point is that we still have quite a way to go before any of this gets through, which is why it is important that the views of this House and another place—and those of 26 other parliaments and all the Houses in them, should they wish, although we understand that only Sweden is likely to do this at the moment—should come forward so that we can reach various red lights, green lights or whatever, as appropriate.

I return to the concerns of the member states. First, I was talking about the legal basis. The new proposal is made under Articles 42 and 43(2) of the treaty on the functioning of the EU. This is similar to the existing scheme. These articles would be appropriate if the predominant purpose of the scheme was the supply of food from intervention. However, given the expected focus of the revised scheme on the purchase of goods on the open market, it is very difficult to argue that its predominant purpose is in line with the use of these articles as the legal base. A number of member states share our concern about that.

Secondly, the concept of cofinancing, which I referred to earlier, is strongly opposed by a number of currently participating member states that believe that the scheme, quite naturally, should be wholly community-financed. The Government believe that, were the revised scheme to go ahead, cofinancing would be very important to ensure that each participating member state reaches an informed judgment on how best to support its deprived communities, and because it would likely improve the governance of the scheme.

In conclusion, I emphasise that Her Majesty’s Government have not taken part in the existing voluntary scheme for many years and have no intention of taking part in the revised scheme if it were adopted. Given that there is presently no qualified majority on paper in the Council, there seems little immediate prospect of the proposal—at least in its current form—progressing that far. The effect would be that the existing scheme would continue to operate. I understand that there is a challenge before the European Court of Justice on whether the legal base for the operation of the 2009 programme is appropriate. That has yet to be heard. The point remains that it is not an activity that is best undertaken at EU level or, in our view, an appropriate use of common agricultural policy funds. Therefore, I stress that I welcome the committee’s report and support the Motion on the reasoned opinion.

[Lord Roper]

My Lords, I can be rather brief in replying because all those who have taken part in this debate have supported the report and the Motion that I have moved. I was particularly glad to hear from the three members of the sub-committee, their chairman the noble Earl, Lord Caithness, and the noble Baroness, Lady Howarth, who were able to add on the general question. In the case of the noble Baroness, Lady Howarth, we were reinforced with her knowledge of local social projects. We were also very much helped by the fact that three Members of this House had been involved in the scheme at earlier stages. Therefore, the contribution of the noble Lord, Lord Teverson, with his fascinating aperçu of acting as Father Christmas, and of the noble Lord, Lord Williamson, and the noble Baroness, Lady Quin, were particularly useful in giving us the background to the scheme. I was glad to have the support on this occasion of the noble Lord, Lord Stoddart of Swindon. I hope he notes that this is one of the benefits of the Lisbon treaty that, as well as other sections, should be taken into account.

I was asked a couple of questions. Before coming to them, one thing that has not been stressed sufficiently is that, although we do not participate in the scheme, the UK contributes to the €500 million that comes from the European Community’s budget. Therefore, that should not be overlooked when we consider this matter.

The noble Lord, Lord Teverson, asked me whether the arrangements were satisfactory. The procedure in this House has been satisfactory. We have been found a date relatively promptly so that it can be debated in good time. I will say one thing that I did not mention initially. On this occasion, we consulted our colleagues in the committees of the devolved Assemblies and asked them whether they had any comments, because some of this is the responsibility of the devolved Governments. We have not had a response on this occasion, perhaps because of a shortage of time, but it shows that we feel that we have that responsibility in matters that are not a reserved responsibility for the UK Parliament.

On the consideration in other parliaments, we have communicated with them. In the 19 countries that are participating, people may not wish to upset a continuing Father Christmas role for their countries and might consider themselves rather unpopular if they were to raise issues of subsidiarity on something that might be seen locally as beneficial. I do not know. However, I believe that we were right—as has been shown by this debate—to put forward our reasoned opinion on this particular measure. I beg to move.