Agriculture Bill (First sitting)

Theo Clarke Excerpts

Committee stage & Committee Debate: 1st sitting: House of Commons
Tuesday 11th February 2020 Public Bill Committees

[Abena Oppong-Asare (Erith and Thamesmead) (Lab)]

Q The main clause of the Bill provides Ministers with the power to make payments to farmers, which is most likely to be allocated on the basis of environmental improvements, not how land is farmed. The Bill does not give any clear guidance on how environmental improvements will be measured. Do you have any thoughts on that?

Caroline Drummond: Potentially, that all goes back to the metrics, and what we are looking to ultimately deliver. The Environment Bill has set out some of the requirements in that area, although that obviously goes beyond farming as well. The 25-year environment plan also covers that area. We have seen, through things like the sustainable development goals and all our global commitments, that there are some really good opportunities to align our ambition here in the UK with delivering against some of those areas. It all depends on how ELMS are going to be managed and developed, but this is where some good environmental performance metrics and targets are starting to come through—hopefully from some of the targets that farmers are setting and working with Government on in a particular area.

ffinlo Costain: There are two aspects to your question. The first is what those measures are. As many Members here and Ministers know, we have been working very closely with Government, particularly on the farm animal welfare metrics and how those relate to the environment. That is critical; what those metrics are is really important, and Government needs to start collecting those.

Then there is the question of the mechanisms—who collects those metrics, and how. From that perspective, Government could work much more closely with assurance schemes to make sure that the metrics that they are collecting are good proxies for what Government wants, and that the new metrics that the Government are looking at are then embedded within those assurance schemes, so that assurance schemes that are already going on farm can do that metrics collection. Then farmers can sign to say that they are happy for some of those metrics to be self-reported. For example, RSPCA Assured may be collecting 500 metrics, perhaps in terms of pigs or sheep, but Government does not want all of those. There are perhaps 15 key ones that Government wants, and farmers need to tick a box to say that they are happy for those to be self-reported, perhaps through the assurance schemes. So there is what the metrics are, and the mechanisms for collection.

Caroline Drummond: We have already earned recognition with the Environment Agency, Red Tractor and LEAF Marque, in terms of helping support that relationship.

[Theo Clarke (Stafford) (Con)]

Q I represent a rural constituency with a lot of dairy and arable, and some of the biggest fruit producers in the west midlands. Quite a lot of farmers have said to me that they are currently enrolled in things like countryside stewardship schemes, and they are going to transition over. Caroline, you mentioned the ELMS scheme. Does this Bill do enough to help them transition over to the new schemes? Are we doing enough to support farmers in the longer term? For example, I have people signing county farm tenancy agreements, which are for 10 years, but we have guaranteed payment for only five years over this parliamentary term. Are we doing enough to support them in the longer term?

Martin Lines: We need guaranteed long-term funding or the ambition to deliver it. On a five-year rolling plan, I am planning eight or 10-year rotations in farm planning. If you are taking on tenancies for longer than that, the business risk is huge. It is about that long-term development. In the transition that we are going to have from one system to the other, we need to be clear and transparent about how that will fit and how we can move. It has become clearer that if we can enter into a stewardship agreement now, we will be able to move into the ELMS when it becomes available, before the end of the period. It is about how we are flexible within those schemes. The current system has been delayed payments, with a nightmare bureaucracy. It has over-measured and over-regulated, and there has been no trust in the farmer to deliver. We need to build that into the new scheme, and build trust with farmers to work to that system.

ffinlo Costain: Countryside stewardship has been very input-focused. Often farmers have done something because there is a box to tick—because they are getting paid for x, rather than because it necessarily delivers the outcome. I think that is what Martin was alluding to. It is not the most successful scheme. There is this five-year transition, where the basic payments are going out. In that time, it is for farmers to step up and understand how to deliver these outcomes, and to develop, either individually or across landscapes, proposals that deliver those public goods. So long as we are focused on outcomes rather than inputs, we will make progress. Farmers should be absolutely at the forefront of that.

Caroline Drummond: A little bit more security and clarity in the timescale is really important. Obviously, farmers do not make decisions today for tomorrow; many decisions are made three or four years in advance. Many crops are grown for nine or 10 months—for livestock, it is a longer time span—before you get any level of return. That timescale is at the moment not 100% clear, because decisions could be made at the very last minute. That is a big concern.

We must not forget that although a lot of the stewardship has not been ideal, for every pound that farmers get from support mechanisms they are delivering so much more from an environmental perspective, because it is good for their business and because, obviously, they fundamentally believe it. We do need to build confidence that the system will work, and that farmers really want to adopt it. We are involved in some of the trials for the ELMS project, and it is really encouraging to see farmers very much embracing it and saying, “Yeah, we want to be involved.”

ffinlo Costain: I said earlier that land use—the way we farm—is the golden ticket for getting us out of the challenges we face and continuing to support food production. I want to give you a couple of statistics. Funding for agriculture is £3.1 billion, but that is tiny in terms of Government expenditure. For every citizen in Britain, we are paying less than £1 per week to farmers for all the good work they do, which we have been talking about. Compare that with £42 per citizen per week for the NHS. Just administrating central Government is £3.57 a week per citizen, so farming is getting very little.

In terms of managing the transition and making sure that farmers can deliver, somebody has to say it: farmers should be getting more because they are doing such a good job. In the future we will be expecting so much more, and I would like the budget to increase.

[Nadia Whittome (Nottingham East) (Lab)]

Q I want to come back to the point about bringing sustainable food production closer to people’s lives. What measures could be added to the Bill to encourage local community schemes to reduce food poverty and improve good nutrition?

Jack Ward: I think the two are largely unrelated. One is an income issue, and there is a separate farming issue. Conflating the two is a problem because the food we produce is often not leaving the farm at a sustainable price, and the opportunity to drive that price down is very limited.

Martin Lines: We need clear transparency within the supply chains, and parts of the Bill address that. Who is getting the benefit out of the produce? Farmers are selling at a gate price that is way lower than the retail price, so who benefits? How can we join up the supply chains to shorten them and give farmers the opportunity to market more directly? There will be lots of exciting technologies and systems that may be able to do that, but it is about incentivising that opportunity.

ffinlo Costain: I think you have highlighted a real challenge, and I am not quite sure how we address it within the Bill. We do not want to see farmers in Britain uniformly producing high-quality produce that just fuels middle-class meals and those of affluent people. We need to recognise that an awful lot of people live in poverty or relatively close to poverty, and we need to be able to feed those people as well. But I do not think that we do that just by continuing with the model that we currently have, which involves ever more intensive volume production and low-nutrition food. We need good food. That is about the supply chain. As Martin said, it is about how we connect people who are living in more disadvantaged areas, with food. Often, if you are buying directly—if you are buying food and making meals yourself—it is a hell of a lot cheaper than living on Pot Noodle or whatever else.

Caroline Drummond: One of the scary facts is that 50.8% of the food we eat in this country is ultra-processed; in France, it is 14%. We do not know about the sustainability of highly processed food, and we often do not know its country of origin. This is where the national food strategy is such a core part of trying to understand what our ambition is for the health and the connection of what we grow. It is out of kilter at the moment and in a very difficult place.

Going back to Jack’s comment, the Bill is about trying to drive the ambition for a highly productive, responsible and sustainable farming system. We need to be very careful. There is often confusion. Poverty is a social issue, rather than necessarily an issue that farmers can respond to, and we need to be very careful that, as an industry, we are not subsidising the social challenge of poverty.

Agriculture Bill (Second sitting)

Theo Clarke Excerpts

Committee stage & Committee Debate: 2nd sitting: House of Commons
Tuesday 11th February 2020 Public Bill Committees

[Abena Oppong-Asare]

Q I will be quick. You mentioned that you are waiting for DEFRA to give you further information. Have you highlighted to them which of your recommendations you want them to take forward?

Nick von Westenholz: Yes. We have good communication with DEFRA officials and conversations are ongoing. Given the immediacy of some of the changes coming in, we are looking for assurance that schemes are going to be developed and deployable quickly. There are concerns over that.

[Theo Clarke (Stafford) (Con)]

Q Does the Bill include the right measures to give tenant farmers certainty over succession, tenancy length and security of tenure?

Nick von Westenholz: As far as they go, we are pleased with the inclusion of the tenancy clauses in the Bill. They are quite technical and we are looking to develop some amendments to strengthen them, which we will be happy to share with members of the Committee. In particular, we want to bring in more of the recommendations of the tenancy reform industry group, which has been up and running and working for some years now, so that those are properly reflected in the Bill. We will suggest some improvements, but we generally welcome the clauses that have been introduced in this Bill that were not in the last one.

[Kerry McCarthy (Bristol East) (Lab)]

Q This is probably a question specifically for David Goodwin. What role do you see county farms playing, given that the Government and the Minister have in the past expressed support for reversing the decline in county farms? Is that something your members would be interested in?

David Goodwin: Yes, very much so. County farms have been a shining light for getting younger people into holdings. In the counties where it works well, it works very well. Obviously, there are counties where there are challenges and more pressures on estates. Unfortunately, we see those in the news regularly at the moment. There are some good examples. The number of county estate farms is very small, compared with the number of people who are perhaps looking for opportunities. Some of those individual holdings are very small and do not always offer the stepping stone that is needed. Going on from there, there is still a lack, particularly with tenanted farms, of progressional farms to go on to from a county starter farm.

--- Later in debate ---

[Miss Dines]

Q What would your choice be? Would it be five years, or four years?

Richard Self: Five years would seem like a good period, but I do not have significant knowledge on that front.

[Theo Clarke]

Q I just want to pick up on the issue of transparency and fairness in supply chains. Would the fair dealing obligations in the Bill currently work with the existing groceries supply code of practice? I want to make sure that we have a consistent approach to fair dealing across the whole supply chain.

Richard Self: I’m sorry; what would that be?

[Theo Clarke]

Q How do we ensure that the existing groceries supply code of practice is consistent, so that we have fair dealing across the whole supply chain?

Richard Self: I probably do not know enough about that. The code does a good job in helping the process. Co-operatives are my area of expertise. It would be good if that included co-operation and collaboration as it would help redress some of the balance of fairness within the supply chain, but would be for the benefit of the whole supply chain if handled the right way.

[George Eustice]

Q I wanted to return to the issue of dairy contracts, and whether there should be a continuation of the special exemption for dairy co-operatives. What is the remedy for a farmer who finds himself trapped in a long-term contract in Arla, a huge pan-European co-operative, where he is not happy with the price he is getting or the way the organisation is being managed, but is unable to change either of them despite nominally having a share or stake in it? Should there be some rights for that individual member as well? Do the articles of association in co-operatives generally provide sufficient protection?

Richard Self: Obviously, there is a democratic process within the co-operatives in which you can vote people on who have a particular stance. The idea is to help control your own co-operative in doing what the membership wants. A co-operative should have a process in place whereby that can be fed into the co-operative to get the criteria right for that membership. The process of democracy within the co-operative should allow for that. I cannot comment on an individual case, but it is up to the members how they run their business. They should be able to set it up the way they want it.

--- Later in debate ---

[Thangam Debbonaire]

Oh, please don’t call it that!

George Dunn: More widely, we think the taxation system needs to be looked at to incentivise longer-term tenancies and penalise shorter-term ones through the taxation system. Ireland has done some good things on the income tax side, which the Treasury could look at, but that is not something that would be put in the Bill.

Judicaelle Hammond: You will not be surprised to hear that I do not agree with that. I do not see that there is a market failure. There might be things in the market that are happening at the moment, because of the way that the system works, that may be unsustainable. We will see what happens when the BPS ends. If you look at some of the reforms that have been made, not in Ireland but in Scotland, it all but killed the rental market. That would not be good for my members or for George’s. We need to be extremely cautious about putting things in legislation and rushing them through without proper consideration of the consequences for both parties. That could lead to a market that is even more nervous than it is now and, as a result, becomes ossified. I do not think that would be good.

George Dunn: We certainly need to learn the lessons of what happened—what is happening—north of the border, but that should not be an excuse to do nothing south of the border.

[Theo Clarke]

Q Mr Dunn, I was struck by your comment about tenancies being too short and the fact that people are just staying 2.9 years and not longer. In my constituency I have a lot of county farms, but I also have a real problem with the lack of a new generation coming through. One thing farmers have raised with me is that because the subsidies will not necessarily continue beyond this Parliament, they can plan for five years, but not for 10 years. Is there anything specific we can add into the Bill to address that specific problem? I totally agree that this longer-term issue is the problem. If I am a county farmer in Stafford, I cannot submit a 10-year business plan because the Government are only guaranteeing it for the first Parliament term. Is there anything specific we can do to address that?

George Dunn: All businesses operate within a sphere of uncertainty about the future for their market and how they intend to run their businesses in the long term. Anybody who thinks they can do a 10-year business plan and stick to it after year five is thinking wishfully. The idea of having multi-annual plans is really good, but they need to highlight how much money will be spent and how it will be spent through those plans, rather than just vague indications of the way in which the financial systems powers will be played. If farmers had a reasonable five-year horizon to work through, that is as much as I think they would be looking for.

Judicaelle Hammond: I totally agree with the TFA that the more certainty in the future, the better. Part of the problem we have at the moment is that we do not have certainty past next year. Although there have been commitments to maintaining the current level of funding, so far they are, unfortunately, just commitments. We would welcome a quantification as part of the multi-annual financial assistance frameworks.

[Theo Clarke]

Q Is the delegated power included in this Bill, which allows the Government to extend the transition period, a good enough safety net if things did go wrong in the future?

Judicaelle Hammond: I am sure it could be improved.

[Theo Clarke]

Q In what way?

Judicaelle Hammond: I think that my lawyers would probably have my guts for garters if I tried to answer that question on the spot.

George Dunn: I think it is good that there is the facility to pause or extend. One would hope that there would be close consultation with the stakeholders to consider that. There is a doubt as to whether we can reverse, which might be possible. There is also the issue, which I know other witnesses have raised, that if you are taking money out of the BPS, and, for whatever reason, we are not ready to spend that through the new public payments for public goods or productivity schemes, that money needs to be paid back to the recipients from whom it has been removed, until such time as the Government are ready to commit to that expenditure.

[Mr Goodwill]

Q Chapter 2, clause 8 deals with the possible extension of the period. I may not understand it particularly well, but it does not make it clear whether, if there is an extension to the seven-year period, that would pause the transition from BPS to ELMS, or whether that would just continue, but at the end of the seven years there would be an extra year or two under the full ELMS system. If there was an extension, at the same time, could that be coupled with a freeze in the transition for a number of reasons, including that the ELMS was not being taken up as quickly?

George Dunn: Yes, and I think that is what the Bill intends. My reading of the Bill would suggest that that is what would happen under those circumstances. To go back to the previous question, if money was taken out of the system that was not able to be spent through the new arrangements, that would have to be paid back, in our view.

Agriculture Bill

Theo Clarke Excerpts

2nd reading & 2nd reading: House of Commons & Money resolution: House of Commons & Programme motion: House of Commons & Money resolution & Programme motion
Monday 3rd February 2020 Commons Chamber

[Theo Clarke (Stafford) (Con)]

It is a pleasure to be able to welcome this groundbreaking Bill. Now that we are outside the EU, we have a once-in-a-generation opportunity to reform how we support English farmers. We have the chance to move away from the EU’s bureaucratic CAP. My constituency has a variety of farms, ranging from dairy to arable, and is one of the largest fruit producers in our region, so this Bill is of great interest to me.

Let me start by saying that I welcome the principle of public funds for public goods that this Bill recommends, but we must ensure that any future agricultural policy also supports farmers in their role as producers of food. I thank the Government for guaranteeing the current annual budget to farmers in every year of this Parliament, but we must ensure that farmers have the funding and certainty they need to plan for the longer term. Let me give a few examples from my constituency to illustrate that point.

It is difficult for local farmers to make long-term investment decisions if they are not guaranteed future payments. Buying a tractor can cost up to £100,000, and investing in a milking parlour or slurry system can cost several hundred thousand pounds. Everything farmers do, from buying livestock to ordering seed in advance or signing new tenancy agreements, requires forward planning and investment. Farmers in Staffordshire have done an admirable job of coping in the past few years, but the situation is challenging. So I am pleased that this Bill recognises the primary role of farmers as food producers, as it is a matter of national interest that our country can feed itself and continues to be self-sufficient. Last month, I brought the Secretary of State for International Trade to meet local farmers in Stafford, who expressed concerns about this issue. We should never compromise food security, especially as an island nation, but that does not mean that we should not incentivise farmers to allow room for nature to thrive. I do not see conflict between farmers’ roles as food producers and as environmental stewards.

Dearnsdale Fruit in my constituency has also spoken to me directly about the labour supply challenges facing large fruit producers. Already this season, there has been a 20% reduction in the number of responses to applications. The seasonal workers pilot scheme needs to be running quicker, or fruit will go unpicked this season. Local producers have told me that the Home Office permits have not yet been granted, meaning that they cannot recruit from non-EU countries. Labour supply is critical to the functioning of the agricultural sector.

In conclusion, the Bill marks the introduction of an important domestic farming policy for the first time in half a century and is a great first step towards a better and greener future for farming and our environment.