Direct Payments to Farmers (Legislative Continuity) Bill

Neil Parish Excerpts

Committee stage & 3rd reading: House of Commons & Committee: 1st sitting: House of Commons & 3rd reading & Committee: 1st sitting
Tuesday 28th January 2020 Commons Chamber

[George Eustice]

My hon. Friend makes an important point. Obviously, that is not a matter for this Bill, but our party’s manifesto makes a clear commitment to our maintaining standards as we approach new trade deals, and to our ensuring that we do not water down our standards or undermine our producers.

[Neil Parish (Tiverton and Honiton) (Con)]

The Minister says that there will be complete continuity of the basic farm payment over the coming year. Does that include continuity of the three crop rule and all the regulation that goes with the present system? Farmers will need to know that. They have got used to the system, and so has the Rural Payments Agency, so we need to know whether the system will be exactly the same, or whether there will be some changes.

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[George Eustice]

As my right hon. Friend will be aware, under the financial settlement in the withdrawal agreement, we did not make a contribution to the next multi-annual financial framework, so the UK will not contribute to the EU budget from 2021 onwards, and will therefore not contribute to the budget that would fund this current year of BPS. We will fund it domestically, and that is why the direct payments regulation must be brought on to a UK regulatory footing.

[Neil Parish]

There is an argument that for many years the UK has actually contributed much more to the common agricultural policy than we have received from it. Can the Minister assure me that as we will not make those payments, we should save some money for the Exchequer?

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[Neil Parish]

I thank Members for reappointing me as Chair of the Environment, Food and Rural Affairs Committee. As I said in my spiel on seeking re-election, my door will always be open to Members on both sides of the House. That was not just a ploy to be re-elected; it is very much my philosophy. I encourage Members to stand for membership of the Committee.

I direct Members to my entry in the Register of Members’ Financial Interests.

I welcome this Bill, as it is essential that farmers have certainty for the coming year. Fifty-eight per cent. of farm profitability comes from the basic payment scheme, and we need to make sure that we not only retain those payments. As we look to our trade deals and our future agricultural production, it would be great to see more of our farming income coming from what farmers are paid for their produce, rather than just from support payments, much as we welcome them.

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[Bim Afolami (Hitchin and Harpenden) (Con)]

Does my hon. Friend agree that, on this question of rural payments, many of the changes needed are not just cultural but ministerial? They do not require extra changes in legislation, so there is an opportunity for the Minister, the Department and, indeed, Members of this House to get things right over the coming months. I have many constituents, as I am sure he does, who complain about the system very much.

[Neil Parish]

My hon. Friend raises a good point. If I interpret the Minister correctly, there will be much more flexibility to look at individual cases and have some discretion. I would like to see that written in blood before I am certain it will happen, as we have had so many problems over the years. My hon. Friend will know that we have had these problems not only in his constituency but across the country, and not for the want of the Minister trying to get this sorted. I believe he will, but we need to be aware of it.

I also welcome the Minister’s setting out that the entitlements for claims and all those things will be covered not only under this Bill, but in the new system. Entitlements for making claims have always been a major problem over the years, and as the systems have changed many people have fallen out of the various systems for being able to make a claim and then have had to appeal. Some of those appeals have been allowed, but some have not, and there has been some real hardship in some cases. This issue is important as we move forward.

One Conservative Member made a point about smallholdings, and it will be interesting to see what we do on that in the future, because at the moment we exclude those under 5 hectares from payments. If it is an area payment, I can see some logic to it, because of the number of claims, but if we are to move to a more environmental system, should not some of those smallholders also be entitled to a payment? I accept that that is very much for the next Agriculture Bill, but today’s Bill does allow for a continuation of payment and, we hope, some flexibility.

The Bew report recommended changes to the way in which the UK CAP funds are distributed among the UK nations. Following the review, the Government increased the amount of direct payment for Scotland and Wales. I very much welcome the money going to Scotland and Wales, but as an English farmer and someone representing an English seat, I naturally want to make sure that that goes as extra money and not at the expense of those payments coming to English and Northern Irish farmers. I think I have had the assurance from the Minister that that is the case.

[Fay Jones]

Does my hon. Friend agree that farmers in my constituency are at somewhat of a disadvantage, in that the Welsh Government want to phase direct payments out much faster than the UK Government? My local farmers who sit on the border between Wales and England will be looking over the hedge at neighbours who enjoy an awful lot more support from their Government.

[Neil Parish]

I very much welcome my new hon. Friend—it is great to have her here representing Brecon and Radnorshire. She makes an interesting point. I believe we are almost going too fast in transferring from one payment to another, given the history of not always getting these things correct in the first place, and so I would take a bit more time. The Welsh Government are going faster and that is the wrong way to go, because we have to make sure that the environmental schemes are up and running, and that they are not only delivering for the environment, but delivering cash into the pockets of farmers. I made this point last week when I said on Second Reading that some farmers believe they can replace all the money that comes from the basic farm payment with the new environmental schemes. They may or may not be able to do that. Perhaps some on permanent pasture, upland and grassland might do so, but others might not, and in Wales, that will be piling on the agony if they are not at all careful.

[James Cartlidge]

Obviously, I congratulate my hon. Friend on his re-election success. I very much agree with him that we need a lengthy transition and a stable period as we move to the new system; surely the important thing is investment from farmers, as ultimately we need higher productivity, but in order to get to that they need to have stability in the interim to plan that investment, with security about the outcome, until the new system is in place.

[Neil Parish]

I welcome my hon. Friend’s comment, because he is absolutely right. I see a problem in the future, not only with this Bill, but with the future Bill; we rightly talk much about enhancing the environment, but we also talk about the productivity and profitability of agriculture, and we must make sure the two knit together. I am absolutely not convinced that they do at the moment—I am sure the Minister and Government will persuade us otherwise. I accept what my hon. Friend the Member for South Suffolk (James Cartlidge) says, because farmers will not want to earn all their income from environmental payments, and that is not the way forward, so they therefore need to earn an income from what they produce. That is the important bit: how we have a productive agricultural system and a more environmentally based one, and how we incorporate the two. I am sure that we can, and I know the Minister has many ideas, so I look forward to that.

This Bill also deals with the Rural Development Programme for England—the development money that sometimes goes to rural areas; it goes into village halls and all sorts of wider aspects. I take it that the Bill will also cover those sorts of payments for the forthcoming year, because I know that in my area in the Blackdown hills and in others it is very important.

I intervened on the Minister to ask about the issue of our payments to the EU, but I do not think I got a complete answer. He assured us that we will not be making a double payment—the payment we pay to our farmers will not then also be paid to the EU. At the moment, we pay more into the CAP than we receive from it, so, to some degree, we subsidise agriculture across the whole of the EU. As we leave this year, we will not be making that payment to them and so we should be saving money. My question was about that and he may be able to deal with it in his summing up. I do not know whether we have the detail of that yet, but it is essential that we make that saving.

Going back to Wales and Scotland, I very much welcome the extra money there. I am very much looking forward to the Second Reading of the Agriculture Bill next week. One thing that we hope we will be able to do when we get the Select Committees back up and running is look at detail about how these new schemes are going to work on the ground, and how they are not only going to deliver a better environment and better biodiversity, but allow good quality, high animal welfare production. We very much enjoy that in this country, across the whole of our four nations, and it is essential.

One or two Conservative colleagues might throw up their hands in horror at this last statement. We have to make sure that as we roll out the new system, we take some of the parts of the basic farm payment scheme and the CAP that have worked reasonably well and we do not throw all the babies out with the bathwater. We need to make sure we take those aspects of what is good about the current system and enshrine them in the new one, while making it more adaptable and much lighter on its feet, and changing the culture of the RPA and DEFRA. We have good Ministers and a Secretary of State who will be able to interpret and help farmers into this new world, so that in the end we can deliver a better environment and better food production, and produce more food in this country, not less, and look forward to a bright future. I very much welcome this Bill.

[Deidre Brock (Edinburgh North and Leith) (SNP)]

At the risk of repeating myself, I am going to repeat myself. The Bill is needed only as a result of the Tory party’s descent into a Brexit fetish. Having to craft emergency legislation to do what was until now normal and routine seems almost a metaphor for the chaos to come. Here we are compensating for a Government who failed to plan and seem surprised that the logical consequences of Brexit are coming to pass. Like those Brexit supporters who have been surprised to discover that the loss of freedom of movement will in fact apply to them, too, the Government seem ill prepared for a future outside the EU.

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[Jim Shannon (Strangford) (DUP)]

It is a pleasure to follow the hon. Member for North Dorset (Simon Hoare). I congratulate the hon. Member for Tiverton and Honiton (Neil Parish) on his re-election as Chair of the Select Committee. He brings a wealth of experience to that position, and we wish him well in it.

I am very pleased to speak in this Bill Committee, both on direct payments and on the commitment that the Minister has given. As always, I am pleased to see him in his place. He understands agriculture, just as he understands fishing, for which he also has responsibility. We look forward to his co-operation with the Northern Ireland Assembly, and particularly with the Minister for Agriculture, Environment and Rural Affairs, Edwin Poots, who is my party colleague.

The agrifood sector is vital to the economy of Northern Ireland, and of my constituency in particular, whether we are talking about milk, beef, sheep, lamb, poultry or arable crops. Sustainability, to which the Minister referred, is critical to enable the agricultural sector to maintain its high food standards, and to gain through its partnership with the manufacturing companies.

[Neil Parish]

I am sure that my hon. Friend agrees that family farms are a structure that is to be found across the whole United Kingdom, but nowhere more than in Northern Ireland. This Bill and the future of agriculture are critical to Northern Ireland.

[Jim Shannon]

I thank my hon. Friend for his intervention. I agree wholeheartedly, and will go into that shortly.

I want to talk about the farmers who do well, the companies that work through them, and the partnerships that are established. Lakeland Dairies, which employs some 260 people, produces milk and powder and exports them across the world. There is also Rich Sauces, Willowbrook Foods and Mash Direct. Those are just four of the companies in Northern Ireland that work in partnership with farmers. Farmers with direct payments enable those companies to produce good products, which they sell across the world.

Farmers in my constituency and in Mid Down are ranked second for milk production across the whole of Northern Ireland. I declare an interest, Madam Deputy Speaker: I am not only a member of the Ulster Farmers Union, but a farmer, so I understand the importance to my neighbours of milk and the whole sector. I received correspondence from the Ulster Farmers Union, the sister organisation of the National Farmers Union. I welcomed the announcement from Her Majesty’s Treasury on farm funding for 2020, as it delivers on the commitment made by the Conservative party, and by the Minister. It is essential that Northern Ireland’s share of UK farm funding is maintained. It is my understanding that Her Majesty’s Treasury has confirmed to the Department of Agriculture, Environment and Rural Affairs in the Northern Ireland Assembly that the money will be rolled over from 2019 to 2020.

We hope that DAERA will be able to pay 100% of payments by mid-October. Has the Minister had an opportunity to discuss the nitty-gritty directly with the new Minister in Northern Ireland, and is there an understanding of how we will achieve the things that we wish to?

Getting a new Northern Ireland agriculture policy up and running by 2021 will be very ambitious, but I hope that the Government are up to the challenge. Last week, the Ulster Farmers Union’s beef and lamb policy committee met to discuss the priorities for the new Northern Ireland Agriculture Minister. The UFU’s hill farming policy committee will meet this week to look at its key priorities. I tell the Minister that because it is important that we work together, and that what is happening in Northern Ireland is mirrored by what is happening here.

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[George Eustice]

I beg to move, That the Bill be now read the Third time.

I thank the House for the debate on this Bill, which is so vital for the agricultural sector across the UK. I recognise the frustrations that some Members might have had because of the need for the Bill in the first place, given that the Agriculture Bill is on its way. Let me reaffirm that this Bill makes no policy changes; it is about continuity. It is a small, technical Bill to ensure that the Government and devolved Administrations are able to pay direct payments to farmers for the 2020 scheme year. Our future intentions for agriculture in England have been laid out by the Government in our Agriculture Bill, which was introduced on 16 January. We know that farmers need stability, certainty and a smooth transition to our new system of public money for public goods, so we will not switch off direct payments overnight. That would be irresponsible. There will be a seven-year agricultural transition period, allowing a system of public money for public goods to be introduced gradually.

I acknowledge that the Bill is being passed according to a tight timescale. However, it is imperative that it and the necessary secondary legislation are in place and in force by exit day, which will be upon us at the end of this week. The withdrawal agreement will stop the CAP direct payments legislation applying in the UK for the 2020 scheme year. This was intended so that the UK would not have to pay into the EU’s next budget cycle, which funds the 2020 direct payment year.

[Neil Parish]

I am going to try once more to get an answer from the Minister. We will not be paying into the common agricultural policy money that comes back to us, but will we be paying the amount that we paid before, which contributed to the CAP across the rest of the European Union?

[George Eustice]

I am sorry that I was not able to address my hon. Friend’s point previously. We will not be contributing to the next multi-annual financial framework or the 2021 budget. Therefore, not only will we not be contributing and getting back money for our farmers—we will pay that ourselves—but we will not be paying into this scheme year for EU farmers, because we will not be contributing to that part of the budget.

I am pleased that the Bill is becoming law so that we can ensure that farmers in each and every part of the UK have the certainty they need as we leave the CAP, and embark on our new and ambitious programme. The Bill has received legislative consent motions from every part of the UK, including Northern Ireland, even though the new Administration formed only recently, and I concur with the point made earlier by the hon. Member for Strangford (Jim Shannon).

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[Neil Parish]

It is a great pleasure to speak on Third Reading, and to follow the hon. Member for Strangford (Jim Shannon), including to raise some of the points that he made. A point made by those all across the House is that this is a continuity Bill that we very much welcome to keep the payments going as they are. However, the hon. Member for Plymouth, Sutton and Devonport (Luke Pollard) made the point for the Opposition that the last Agriculture Bill was in the 1940s, after the war, when we were looking to increase the production of food. Later we went into the common agricultural policy, which spent all of its life increasing production across the whole of the European Union until we got to the 1980s, when we had milk quotas and all sorts of restrictions to try to limit production, and so on. We have seen a whole period of agriculture and food production that has very much been linked to production.

I very much want to raise this point: as we move forward not only with this continuity Bill but with the new Agriculture Bill, we can actually take forward production and enhance the environment at the same time. I have made this point in this House so many times. The countryside we see across the whole of the four nations of the United Kingdom is not there just as God provided it, but is a managed landscape. It is managed by farmers. That is why we can have production, but also have a great environment.

As we talk about carbon and about growing trees, we sometimes forget about the amount of carbon that permanent pasture holds in the ground. If we have permanent pasture, we as humans—I do not want to be too facetious here—cannot actually eat grass, so we do need livestock and red meat production. We also need to look at varieties, species and rare breeds to make sure that we can have a very diverse agriculture in the future.

As has been said, I think there is much to be done, and sometimes we do not realise the enormous nature of what we face. Before I got to this House, I tried to make my living as a farmer. For the whole of our lives, farming policy has been dominated by the common agricultural policy, with 28 countries of the European Union wanting different forms of crops and different types of agriculture. Even if we take sheep production, which across the four nations of this country is very much an extensive form of production, we can see in France that it is a much more intensive form of production. Farmers in France produce their sheep in a much more intensive way, whereas for us it is grassland production, and I think grassland beef and sheep are going to be very important in the future market.

The hon. Member for Strangford raised a point about smaller farmers and family farms. That is where we have to be careful to say that having good-quality, high-welfare, intensive production is not all wrong. We very often say that we have some of the best poultry units in the world, but that is intensive production. As the shadow Secretary of State said, if we compare that with the production that takes place in America, we see that the density of population of chickens is two or three times that of our own, and we see the use of antibiotics in the water as a precautionary mechanism, which we have not used now for many years.

We have spent a lot of time in this country creating agricultural production that is welfare-friendly, reducing antibiotics and making sure that we can deliver high-quality production. What we do not want to see in any future agriculture Bill or certainly in any new trade deal is those high standards of welfare being watered down, including—dare I say—in any mechanism to get a trade deal across the Atlantic. Therefore, it is absolutely key, as we move not only to the continuity of payments Bill but to the new Agriculture Bill, that we do not take our eye off the fact that we need a good trade deal. The point has been raised that, while we are talking about the continuity of payments this afternoon, many farmers out there, especially in the poultry sector, do not actually receive any payments at all. They are very keen on the trade deal that will take place to make sure they can carry on having a living.

As we move forward with the Agriculture Bill and look at the new system of payment, it is important that we in this House do not actually put farmers out of business. We want to make sure that we enhance farming; make sure that farmers can then deliver good-quality agricultural production and can afford to remain in business; and very much make sure that we can deliver the agriculture that we need.

Question put and agreed to.

Bill accordingly read the Third time and passed.