The Secretary of State for Health informed the House on 7 June of how the Government are taking all possible measures to monitor the serious E. coli 0104 outbreak that is centred in Germany and to assess and deal with any associated risks should any arise for consumers in the UK. I will not repeat what he has said in relation to the background of the outbreak.
It is deeply regrettable that this outbreak has resulted in the loss of life. It has also had a disruptive economic impact on growers and others within the supply chain for fruit and vegetables across the EU, including our domestic industry.
At retail level, prices for domestically produced salad—lettuce, tomatoes, cucumbers, sweet peppers and courgettes—have remained relatively stable, although demand has declined, with the result that more produce is being sent to the wholesale market, which is experiencing movement in prices. I welcome the support for UK producers shown by the big retailers who have in some cases increased their offering of UK salad produce, in response to consumer demand for our home crops.
One impact of the decision by the Russian Federation to impose a ban on EU fruit and vegetable produce is that surplus produce has been directed to alternative EU markets, including our own. The consequence has been to depress values in the wholesale market, with volumes down, although here again, I understand that prices for English produce are faring better than those for imported produce. But the situation continues to develop and the latest indications from our trade organisations are that the market has deteriorated.
The impacts of the overall situation are being felt across the EU and because of this, the Agriculture and Fisheries Council on 7 June discussed the need for exceptional measures to address the market situation and to provide financial support for growers affected. Proposals were discussed by Ministers at Council level and considered by officials at the EU Fruit and Vegetables Management Committee but no package has yet been agreed for implementation. Discussions will continue on 14 June.
The proposals build upon existing measures that are available within the fruit and vegetable aspects of the common agricultural policy via its Single Common Market Organisation (sCMO) of agricultural markets. No brand new measures are proposed. The total budget proposed would be €210 million, which would come from the existing European Agriculture Guarantee Fund (Common Agricultural Policy) budget to cover tomatoes, cucumbers, lettuce and also peppers and courgettes. No additional funding is proposed. The proposals cover the extension and relation of the rules covering market withdrawals. In the main this means that produce will go for destruction, because the perishable nature of fresh produce means that intervention is not a viable option. Compensation would be paid only in respect of the withdrawal of produce and it would not extend to compensation for loss of earnings nor to pay for the difference between current and normal expected market value. Details of the proposal are as follows:
Separate maximum compensation rates at €/100kg would be established for tomatoes, lettuce, cucumbers, peppers and courgettes, to represent about 50% of the usual average June price for such produce.
The measures would be open to all member states to implement.
The allocated funding would be available on a first-come first-served basis—there are currently no plans for an allocation per member state.
In general withdrawals of produce must be made via Producer Organisations (POs) recognised under the sCMO. There is already such provision through POs’ existing funding programmes but the proposed new funding will be additional. However, under amended proposals, the Commission are considering an alternative route via the Paying Agency direct, which would be helpful for growers who are not members of a PO.
The proposal is for a temporary measure, to apply retrospectively from 26 May to 30 June, or when the budget is exhausted—whichever is sooner.
At a later stage, the Commission will consider whether a promotional campaign for fruit and vegetables could also be considered, to support the restoration of consumer confidence in the market.
The Department for Environment, Food and Rural Affairs will continue to maintain close contact with the Food Standards Agency and with industry organisations and is discussing with the Rural Payments Agency and other Government Departments how to implement the proposed measures.