The Committee consisted of the following Members:
Chairs: † Sir Roger Gale, Phil Wilson
Antoniazzi, Tonia (Gower) (Lab)
† Brock, Deidre (Edinburgh North and Leith) (SNP)
Chapman, Jenny (Darlington) (Lab)
† Clark, Colin (Gordon) (Con)
† Davies, Chris (Brecon and Radnorshire) (Con)
† Debbonaire, Thangam (Bristol West) (Lab)
† Drew, Dr David (Stroud) (Lab/Co-op)
† Dunne, Mr Philip (Ludlow) (Con)
† Eustice, George (Minister for Agriculture, Fisheries and Food)
† Goodwill, Mr Robert (Scarborough and Whitby) (Con)
† Harrison, Trudy (Copeland) (Con)
Hoare, Simon (North Dorset) (Con)
† Huddleston, Nigel (Mid Worcestershire) (Con)
† Lake, Ben (Ceredigion) (PC)
† McCarthy, Kerry (Bristol East) (Lab)
† Martin, Sandy (Ipswich) (Lab)
† Stewart, Iain (Milton Keynes South) (Con)
† Tracey, Craig (North Warwickshire) (Con)
† Whitfield, Martin (East Lothian) (Lab)
Kenneth Fox, Anwen Rees, Committee Clerks
† attended the Committee
John Cross, Chair, Traceability Design User Group
Professor Pete Fox, Director, Water, Land and Biodiversity, Environment Agency
Helen Taylor, Programme Manager for the Future Agriculture Programme, Environment Agency
Jack Ward, Chief Executive, British Growers Association
Helen Browning OBE, Chief Executive, Soil Association
Public Bill Committee
Thursday 25 October 2018
[Sir Roger Gale in the Chair]
Good morning, ladies and gentlemen. The Minister will move an amendment to the programme motion agreed by the Committee on Tuesday.
I beg to move,
That on Thursday 25 October, after hearing oral evidence in accordance with the motion agreed to by the Committee on Tuesday 23 October, the Committee shall hear oral evidence from the following until not later than 4.30pm—
(1) Ulster Farmers’ Union;
(2) NFU Scotland;
(3) Scottish Government;
(4) Quality Meat Scotland.
I wish to record my thanks and that of the Committee to the patient Clerks, who have made accommodations following late requests for additional witnesses.
On a point of order, Sir Roger. Simply put, we need to hear from the Rural Payments Agency and the Groceries Code Adjudicator. The one thing that came out of our earlier sittings was that no one quite knows how what is in the Bill will work, so we need to know from the extant organisations—they might be replaced, but that is something for the Government to decide—exactly how they think they will operate. I ask for another sitting to hear witnesses from those organisations. They might not be able to come, because of the short notice, but they should be called to account. I hope that would be agreed unanimously.
In answer to the point of order, my understanding is that the organisations to which you refer were invited to participate but to date have failed to say that they want to attend. I am not sure, but I suppose we have similar powers to a Select Committee to compel them, but the fact is that they have not responded.
Furthermore, those organisations have the right to submit written evidence if they wish to do so at any time. I strongly advise and encourage those with an interest in the Bill—I of course am strictly impartial—to do so, if that is what the Committee wishes. I, however, have no power to alter an agreed programme, so I must now proceed.
I shall add one caveat: if by consensus—it has to be by consensus—the Committee decides to take further evidence later, my understanding is that that is probably practicably possible, but the Programming Sub-Committee would have to reconvene. I suggest that the most practical way forward, given that we are where we are and that those organisations have not responded, is that they are encouraged to provide written evidence, which will of course be made available to all the Committee. It goes without saying that, outside this Committee Room, neither the Chair nor anyone else has any power to restrict conversations between any Member and any organisation, so if Members wish to seek input and advice, they are at liberty to do so, as always.
Question put and agreed to.
The Committee deliberated in private.
Examination of Witnesses
John Cross, Professor Pete Fox and Helen Taylor gave evidence.
Thank you for joining us. As always, I am afraid we are playing “beat the clock”, but we will do our best to ensure that everybody has a fair hearing. For the record, please introduce yourselves, starting with Professor Fox.
Professor Fox: Good morning. My name is Pete Fox and I am director of water, land and biodiversity at the Environment Agency.
Helen Taylor: Hello, I am Helen Taylor and I also work at the Environment Agency, where I am programme-managing our input to future farming.
John Cross: Good morning. I am John Cross. I am a farmer by trade, but I also chair the Department for Environment, Food and Rural Affairs tuberculosis eradication advisory group, and I chair the Traceability Designer User Group for the industry and DEFRA.
John Cross: The industry—the whole supply chain—has been mindful for many years that the flow and sharing of data within the supply chain has been virtually non-existent. In the past, the Government have had powers to collect data that they needed for statutory purposes, such as notifiable disease, food chain information and food safety. Those statutory needs were catered for, but for many years the supply chain itself has suffered from the weakness that comes from an absence of data in that supply chain. Data is important for eradicating endemic diseases, which hold back the productivity of the national herds and flocks, and for evidencing the provenance of products for international and domestic markets. Obviously, it is in everyone’s interest to be able to stamp out exotic disease in a hurry, should it flare up. Evidencing provenance in the supply chain is important for international trade opportunities, where international customers’ No. 1 question is always about traceability and the availability of information about the product.
We are not well equipped as a supply chain at the moment at all. In fact, the industry has come to the conclusion, fairly rapidly since the referendum in 2016, that it needs to think very differently about its future. It needs a lot more information to manage its supply chain a lot better. It needs to rid itself of endemic disease. It needs to explore the best possible portfolio of opportunity in the global and domestic market. It needs more information about itself, to enhance those efficiencies, drive out disease and trade with a very good evidence base about its product.
Thank you. Ms Taylor and Professor Fox, if you wish to add anything, please feel free to do so.
John Cross: Yes, indeed. As people may or may not know, for the three production species—cattle, sheep and pigs—at the moment there are three different systems. In the main, except for the pig system, they are almost entirely paper-based, with all the problems of workload and cost that go with that.
For the last 20 months, the industry and Government together have formed a group called the TDUC, which is part of an aspiration for a completely new digital livestock information service, and for 20 months Government have been working alongside industry and all the DEFRA agencies, such as the FSA, the RPA and trading standards—everyone who has an interest in livestock welfare, livestock health, livestock movements and traceability, food safety and product authenticity.
Anyone involved in those areas of work is involved in what is a co-creation partnership that, for the last 20 months, has worked to design what we intend to be the new livestock information service, which will be a multi-species, paperless, digital information service that will eventually be real-time and comprehensive. That is where these particular data-collection and data-sharing powers will come in—to be the lifeblood that makes the system work. That will probably be the biggest step change that certainly the ruminant livestock sector in this country has seen in many decades.
The pig industry, which is rather more integrated and further down the road than the ruminant sectors, is part way there, but being part of a single system will add value to it as well. This will certainly be the most enabling action that industry and Government could jointly make to make the ruminant livestock sector fit for purpose for the future. That is certainly a view strongly held by the industry itself.
John Cross: Over the years, I have been quite heavily involved in international trade development, and one of things that struck me in the south-east Asian markets that people talk about, and particularly in China, where there are huge opportunities, is that when you sit in front of Chinese veterinary officials and talk to them about market access, their primary and secondary questions are all about proof of traceability, evidence of traceability, evidence of centrally co-ordinated disease control strategies and data. They talk about product quality and price et cetera at a much lower level later. Any of the big markets we would aspire to balance our whole trade picture with would challenge us on evidencing traceability —that would be their very first question.
Indeed, if we actually look at our proposition, as an English industry out there on the global stage, you cannot get away from the fact that all the other big meat-producing economies and traders have either already done what we are doing or are in the process of doing it now, at pace. I strongly believe that in this country we produce some of the best—if not the best—meat products in the world, but the challenge from future customers and competitors will be to prove it. At the moment, our system creaks and struggles to do that, whereas with the powers that we seek, that would be a real-time service that could be demonstrated digitally anywhere in the world, and that would put us completely on the front foot.
John Cross: To completely enable our vision of the livestock information service, your data has to be complete —you cannot function with half or sub-optimal data. If you are eradicating disease, and that is your focus on that particular usage of data, then unless it is complete, you will not achieve your goal. At the moment, DEFRA has powers to collect data for statutory purposes, but it doesn’t actually have the authority to share that data and to allow people within the supply chain to make use of the data.
There are a whole lot of opportunities for farmers themselves. For instance, there is at the moment a desperate need for farmers to make informed purchasing decisions about whether the cattle they are buying have come from a TB high-risk area or an edge area, or whether they are going to a low-risk area. That whole area of risk-based trading—for any disease, not just tuberculosis—needs information. You cannot manage risk without data. You need the ability to collect data in a complete format from everyone, and then you need to be able to share it so that farmers can access it easily and quickly and it is available in the supply chain. That is what is different—the collection of complete data and making it available.
Professor Fox: First, I would like to say that the Bill provides a really good framework for taking the whole agriculture sector forward. It has a lot to commend it, particularly the provision for payment for public goods and the recognition of a need to transition the sector into a new place.
In terms of the things around regulation enforcement that we would like to see, from an environmental perspective, the Bill could provide an opportunity to have a clear and simplified regulatory baseline. At the moment, we have a series of maybe four key pieces of legislation that are applied disparately, and the Bill offers an opportunity to provide farmers with a clarified and simplified view of what is required of them. I believe that will lead to better conversations between farmers, suppliers and ourselves about what is expected.
Within that, it should be recognised that the provision of environmental goods or public goods should be contingent on compliance with that regulatory baseline in order to give the public confidence that their money is invested in farmers and in outcomes that are genuinely provided in a healthy and vibrant countryside.
Professor Fox: The issues in farming, and the impacts that farming has on the environment, will be consistent, whatever regulatory or legislative framework is in place. Our skilled workforce is there to advise farmers and to work with them, but then to enforce regulation if necessary—we will be consistent. Unless the Bill or the Secretary of State determines that other regulations will apply, the current framework will roll forward, and we will work on that basis.
Professor Fox: Part 1 of the Bill provides the Secretary of State with powers to make grants to farmers for various public goods, including the management of water—within that, the management of flooding would clearly be a potential beneficiary. The opportunity to manage floods better through landscape-scale work with farmers is already widely recognised. There are a number of schemes around the country where farmers provide attenuation ponds to reduce flood flows, and in so doing provide important community benefits. This scheme of paying for public goods may well support and augment that, and that can only be welcomed.
Professor Fox: Absolutely, and flood is not different from many other environmental issues. Introducing schemes that provide for farmers to work together to share and deliver common outcomes would optimise improvements and protection of the environment, not just as to flooding, but for birds and woodlands and for all sorts of other good reasons—not least the protection of water and water quality.
Professor Fox: Where money is set is a matter for Government to decide. We would advise that there are certain circumstances where that might exacerbate already known flood risk issues, particularly around, and upstream of, rural communities, but we will be there to help and support the delivery of Government’s aims in the round, and we will try to mitigate the impacts on flood risk or any other environment issues arising from Government’s stated aims for the delivery of funds.
Professor Fox: We would be directed by Government to take a particular role. However, I can, through my knowledge and background, understand that, actually, it is not just about all land management needing to change to mitigate flooding. Modelling and studies have shown that quite targeted management of key pieces of land can actually deliver quite big benefits downstream. So I could see us having quite an influential offer to make to Government in advising on how that money should be distributed; but we would take direction from the Government.
Thank you. Quite a lot of Members want to ask questions and we do not have a great deal of time, so I ask for brevity both on the part of questioners and in answers, please.
John Cross: I think everyone in our industry would advocate that food and food products procured outside the country should adhere to, and be produced to, the same standards that would be expected of the domestic industry. Indeed, I think everyone’s aspiration would be for workers to be treated in exactly the same way in those other countries. It is beyond my skillset to know what influence we can have on that, but yes, I think that consumers, producers and the whole supply chain in this country would expect imported food to adhere the same standards and to be of the same production standards as ours.
John Cross: The investment required to change the way animals are identified from the way they are identified now, in fact a system like the livestock information system—in order for it to work, be real-time and achieve what everyone desires—would have to be based on individual electronic identification. So, over a period, we would have to mandate bovine EID. That would mean a small increase in cost in the tagging of cattle, but as scale develops that extra cost diminishes.
We have not yet looked at the technology required for on-farm reading and the rapidity of uptake. It may be that something could be done to enhance training and equipping at farm level. However, we are making sure that in the planning of this system, those farmers who do not wish at the time to invest in reading equipment, or feel that they do not understand it, will have access to collective reading facilities. In other words, that is where the livestock auctioneer sector is so important for smaller producers who do not want to upscale. They can actually get their livestock read, so that they can adhere to the system without having to equip themselves. So we are trying to make it as flexible and as kind as possible, but industry in particular is fairly ambitious about the timescale of change. We must not try to run two systems alongside each other, because the aim is to go from paper to digital and trying to run both systems would be fraught with problems.
Professor Fox: We currently have little responsibility for monitoring and reporting on the state of soils. We are aware of the importance of soils to the production and productivity of our whole landscape, and we are worried about the scale of soil loss, particularly that emanating from farming. It has a large cost associated with it, as well—water companies clearing up the soil and the dredging of rivers that is required as a result of from soil loss.
So we would strongly support a greater focus on soil if this Bill could provide it, and more opportunities to help and support farmers to maintain that core productivity. It is absolutely in everybody’s interests that we keep soil on the farmland. I think that greater focus on soil would be entirely beneficial.
Helen Taylor: In answer to the question whether payments or other mechanisms change behaviour, I believe that we need a variety of mechanisms working together. At the moment, regulations are set to prevent pollution from occurring, for example from the water side of things, and then payment is given to raise that standard and deliver more for the environment and the public goods that we want to achieve. Those things together, or combined, have a better effect than either one or the other.
Alongside that, there are all sorts of mechanisms for providing advice and guidance and showcasing how people could best carry that out. I firmly believe that a combination of mechanisms is needed for the future.
Professor Fox: I support that very strongly. The role of the supply chain and producer organisations in helping to promote and assure good environmental practice is a fantastic adjunct to any enforcement effort, and also helps support and promote the delivery of public goods. It is about that mixture of carrot and stick, if you like, to achieve the right outcomes for society and the industry.
Professor Fox: I am not sure I can provide you with a view on that. Clearly, what we have in the Bill is a sensible transition period covering a number of years to allow the industry to move into a new framework of payments. I think that is entirely helpful; it will allow the whole industry to adapt to a new way of thinking for the public. The scale of investment will be a matter for Government.
Professor Fox: Yes.
Helen Taylor: As a point of clarity, I am not in charge of that; I am just trying to support DEFRA’s thinking in terms of future farming. There is certainly room within thinking at the moment to consider the value and benefit of forestry in helping to deliver those public goods.
“starting point for the conversion of the agriculture sector to the one we would like to see.”
In no other industry is knowledge passed on from generation to generation more than in farming. Farmers know their land best. How do you feel that smaller upland and lowland farms will benefit from the Bill, and how will it encourage the next generation of young farmers?
Helen Taylor: I agree that knowledge is passed on in this sector. The potential to recognise the public goods that some of those smaller holdings have been promoting and protecting over the years is an advantage for them in the future. Could you repeat the second part of your question, sorry?
Really, it is about how future generations of farmers will feel confident about their potential future on, perhaps, the family farm after the introduction of the Bill. What will it provide for smaller upland and lowland farmers?
Helen Taylor: It is basically the same point again. I hope that recognition of the value of public goods that the farming sector has the potential to deliver will give them more reassurance and more sustainability into the future. Linking it back into the fact that the business itself is dependent on what we might term “natural capital”— clean water, healthy soil in the right place, a healthy atmosphere and a regulated climate—by farming in a sustainable manner, they are buying into their own future assurance as well.
Helen Taylor: Not necessarily, no. I think rewilding is a specific issue for specific places, and it is not necessarily appropriate across the whole of the UK.
John Cross: I totally agree with several of the things I have heard about the quality, fertility and productivity of our soils. That is something that some in the industry and some areas of the country have slightly lost focus on, and it is something that I myself am very passionate about.
I do not farm in an area where flooding is a problem, so I do not have any experience there, but designing schemes to encourage or nudge producers into taking a more active role in managing the long-term stability and fertility of their soils has to be the right way to go, because the land’s ability to produce grass or food crops is entirely dependent on its health, structure and organic matter levels. It is the right way to go.
John Cross: The answer to that is yes. If you look around the world, there is quite a lot of not-quite-off-the-shelf, buy-it-and-plug-it-in technology. High-calibre EID traceability systems are in place all over the world. To identify the equipment that would suit the industry best, we have already had an open supplier day to look at technologies and the potential suppliers of such technologies. In fact, 38 companies from around the world came and showed an interest. If we throw the door open, so to speak, and explain to the industry what we want to achieve and what outcomes this country is looking for, those that see themselves as best suited stay with the process. The aim is to procure the best proven system, rather than build one from scratch.
John Cross: “Animal health” is a very complex phrase. You have got animal health from the point of view of the absence or presence of disease, and animal health from the point of view of making a judgment about animals that are sick—there is a welfare issue there, depending on the severity of the disease. Animal health is a wide subject. As I said earlier, animals that are suffering from various levels of endemic diseases can be regarded as suffering from that disease. They are highly inefficient; they are wasteful. Animals that are diseased have a higher carbon footprint than healthier ones. They produce less from the inputs they are given. It is like trying to run an industry with the handbrake permanently on. Nothing performs well enough.
From the point of view of the use of inputs, the future of the environment and the impact on climate change, you are much better off if you have a well-run industry producing very healthy animals extremely efficiently. At the same time, that enables you to do a better job environmentally. Inherently, the welfare of animals is enhanced by the absence of disease. It is all interlinked. Is it a public good? I would say yes. Not entirely, but yes.
Before I revert to the Minister, are there are any more questions from the Back Benches? No.
On the specifics of the schemes we have now, is not the issue you raise covered by clause 3? It is explicit that, through regulations, the Secretary of State can set eligibility criteria for the new schemes, enforce compliance with the new schemes, make requirements about record-keeping, have the power to recover financial assistance and even impose monetary penalties and create offences. That is a pretty comprehensive set of enforcement provisions to sit alongside a new scheme.
I take your point, and the Government accept that we want to review the regulatory baseline and the culture. However, for the purpose of the schemes outlined in the Bill, do you not think the issue is covered by clause 3?
Professor Fox: I agree that clause 3 has an awful lot to commend it, and I believe that is the framework on which the environmental regulations could be hung. Our aim is to ensure that there is clarity for farmers as well as regulators on what we are seeking to achieve together for the future. In that respect, the clause provides the powers and responsibilities—the opportunity for Ministers to make those schemes and those decisions. However, a bit of clarity in the Bill on the direct linkage of compliance with the environmental baseline, being a prerequisite of getting money for public goods, would make a clear statement about the Government’s expectations for the industry. We are contributing fully to the review by Dame Glenys Stacey, as you know, and we look forward to helping the Government to interpret and determine how they want to take any of those forward in any case.
Professor Fox: I agree that it gives the Ministers the choice of doing that.
There are no further questions. Thank you Professor Fox, Ms Taylor and Mr Cross for coming to join us and for your evidence, which is greatly appreciated. Thank you very much indeed.
Examination of Witnesses
Jack Ward and Helen Browning OBE gave evidence.
Good morning and thank you for joining us. For the benefit of the written record, I would be grateful if you identified yourselves, starting with Mr Ward.
Jack Ward: My name is Jack Ward and I am the chief executive of the British Growers Association. We operate in the fresh produce sector.
Helen Browning: I am Helen Browning, chief executive of the Soil Association and a very mixed organic farmer in Wiltshire, with a whole variety of other enterprises as well.
Thank you very much. Ringing the changes, would you like to kick off this time, Dr Drew?
Jack Ward: There is terrific potential for us to increase our market share. At the moment, we are about 50% of fresh produce, but that is enormously variable. On tomatoes, we only do about 20% of production; on pears, it is about 27%. There is a terrific opportunity. There is an appetite to buy British and an appetite from the retailers to buy British. We have the technology and the skills. There is an opportunity to increase our consumption, so from a fresh produce point of view we just see opportunity ahead. It is just a question of capitalising on that opportunity.
Helen Browning: The Bill is the only bit of the jigsaw that we currently have and we are pinning a lot of our hopes and fears on what it contains. The other more detailed policy that will come through will largely determine whether the powers given in the Bill are used in the right way and will lead us into a great future or not. We are also waiting for a food plan, which will be very important in terms of the market and the market pull. We do not know what the trade environment will be.
The Bill gives some new powers, which is helpful, but it does not set out anything other than the skeleton of what might come. There is a huge amount of devil in the detail that needs to follow, and we need to join all of those things up before I can properly answer your question. I can say what I would like to see in 20 years’ time, but I think the Bill gives us the “may”s, not the “will”s, and a lot more detail needs to follow.
Helen Browning: The areas where I am still unclear in terms of the public good section is whether we are really focusing enough on soil. We talk about land; we do not talk about soil. We talk about natural culture or natural heritage; we do not talk about wildlife and biodiversity. We need to be a little more specific about some of those areas. Given that we do not yet have any sense of what might happen in other places around a food plan, I would like to see public health mentioned within the Bill as a public good. That would be very helpful.
There is an interesting split: there are some provisions for the support of public goods, and those are very welcome, although they need to be expanded. We then also have a lot around productivity, which could be helpful, but again the devil is in the detail in terms of how we are lining up and looking at those productivity measures.
Are we looking at the environmental and social impacts of what we are doing when we talk about productivity? How do we define that? We need to make sure that we are not setting up some new great initiatives in one place, maybe on the fringes of the field, but not thinking about the overall industry and how it will operate, and how we are going to green the whole of farming and the food system over the next 20 years.
There are still some improvements that need to be made, but, as I say, it is the way this will be interpreted, particularly the definition of what we mean by productivity, that we need to look at hard.
Jack Ward: The first thing to say is that the fresh produce of industry is largely operated outside of the common agricultural policy; it has had very little support over the past 40 years. Some of the things in the Bill are definitely positives. We welcome the continuation of the producer organisation scheme, and we look forward to conversations with DEFRA and the industry to see how we can improve the operability of that scheme. We all recognise that it has its shortcomings, but, going forward, it is a real opportunity.
The productivity piece is interesting. Within fresh produce we are always interested in how you reduce the risk of growing some crops and how you increase and improve the quality of those crops. The other interesting piece is around supply chain fairness. I know that is still to come, but obviously when you deal with multiple retailers and 85% of everything we produce goes through the hands of 10 people—possibly soon to become nine—how you address that imbalance between a large number of relatively small businesses and some enormous businesses is a constant source of tension.
For the benefit of our witnesses, I should explain that the Minister is not being discourteous. He has had to leave to present a Bill on the Floor of the House, but I am sure he will be back before the end of this session.
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, which are often very large businesses, have 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.
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.
Helen Browning: That is why we need to look at this alongside the food plan 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; 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.
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.
Part 6 of the Bill is about fairness in the supply chain. Several retailers have moved to central direct buying, effectively reducing the role of contracted 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 to 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—OMSCo, the 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.
Jack Ward: Yes. I think the fear from a grower point of view is that it just drives the price even lower. The real concern, if they are going to compete ultimately on price, is what that will do to the pressures in terms of trying to produce food in a sensible, balanced and economic kind of way. It does open up new opportunities, undoubtedly, but the big issue is whether it just moves even more of the grocery market into the discount sector. I think that is the real concern.
Helen Browning: The problem with the discount sector is not that it pays less to farmers, but that they are taking less margin themselves, and therefore the mainstream supermarkets feel they need to match those prices, and they squeeze harder. I actually think that a lot of the discount sector can be very helpful for farmers. Ocado and Amazon can work well for smaller-scale producers. As a producer myself, I sell a lot of stuff through Ocado, because it is very straightforward. They will list stuff very easily and they can have more SKUs. Therefore they can offer a much wider range of produce than your mainstream supermarket can, so there are opportunities there. The threat is in the competitive pressure that is exerted on those big four supermarkets, which are still where the majority of food is sold.
Helen Browning: I would like to think so because that is the other bit of the jigsaw. We are looking here at the production end and particularly at the support elements for farmers. We are not looking at the trade environment, which is going to impact hugely on this, and we are not looking at what is going to happen at the market end or at what will happen through the rest of the supply chain.
In an ideal world, we will be looking at all these bits of the jigsaw together and seeing how they fit together. It is very hard to get this bit of it right with only that base camp in terms of how we will affect farmers’ support into the future. We have no idea of the levels of support that there will be, and that is obviously a factor. The need for it will be influenced by what happens to the trade environment and the market more widely.
It is kind of tricky to do this. What I would ask, given that we do not have that clarity, is that we give broad powers and start to think about the targets. Introducing targets into the Bill would actually give us some destination point and allow the powers to be used in the right way, depending on what else comes through over the next year or so.
Jack Ward: One of the criticisms I have picked up from talking to producers is the lack of reference to food and the promotion of food in the Bill. I think that the food strategy gives the Government the opportunity to redress that issue and spell out a vision for the food industry in the UK. It is our largest food-manufacturing sector; there are opportunities there—there are economic opportunities—and we seem to be at a really good point to take advantage and capitalise on them. I think the food strategy could be hugely influential and send a really important message of confidence throughout the industry.
Jack Ward: There is a list of things. Research and development is massively important—there is no access to ready-made solutions for the problems faced by a lot of relatively small crops, so they are invariably looking for solutions to problems, and research and development is absolutely vital.
There is also capital investment, and a good case in point at the moment is the replacement of seasonal and casual labour. How are we going to manage that? We are going to be looking at robotics—I think that the timescale is 10 years out, but that kind of thing is going to be really important. On skills and labour, which follows on from the whole seasonal labour piece, we probably need to be investing more into labour and encouraging more labour from UK sources for both seasonal and—more importantly—full-time activities.
There is also the issue of productivity and help with technical support. Often, growers are faced with a barrage of issues, from health and safety to GSCOP issues. Their ability to absorb every technical wrinkle that they need to know can be quite limited, so I think technical support would be pretty important, too.
Helen Browning: I agree that there is no real clear provision in the Bill for support for R&D. I ask in particular for more support for farmers to do their own research. The work we have done with things like Innovative Farmers has been incredibly successful and very cost-effective in getting both knowledge transfer and trials done more professionally by farmers themselves.
Quite rightly, we talk a lot about fruit and veg, but agroforestry, which might also take us to biomass, nuts and timber production—there was a question in an earlier session about forestry—could be a hugely helpful way of squaring a number of circles. I would like some provision for that.
On the point about skills and advice, it is important to have good advice to assist farmers through the transition they will have to make, but it needs to be de-linked from companies that are trying to sell products to those farmers. Too much advice that farmers take is from companies that have products to sell. We need an independent advisory service available to farmers, so that they are assisted through the big changes they will have to make. We think that farmers have all the skills they need, whether for horticulture or for the delivery of public goods, but a lot of farmers—I am one of them—will have a lot to learn, and we will need some help with that. We need good, independent support.
Jack Ward: Quite a lot of the existing scheme is well worth carrying across. Some of the disciplines that it imposes are good, such as the requirements for a formal structure and for collaboration. The match funding element is good. There is not too much wrong with the categories under which you can claim grant aid, although there are issues about what proportion of the grant falls into which category.
The area that probably needs most attention is the issue around marketing: what is the interpretation of the PO role in marketing? I think I mentioned that we have reached a situation where, when doing online tendering, it is quite difficult for someone to argue that they have done the correct proportion of their activity on marketing when, in fact, it took somebody a morning to prepare an online tender, they won the tender and that was the end of it for a year. It is a question of looking at it and making it more UK-centric, reflecting what happens in the UK as opposed to what happens in some parts of Europe.
Jack Ward: We welcome the provisions on producer organisations. We look forward to a constructive discussion about how we can build on where we have got to and develop something really good that works for growers and consumers in future. I am looking forward to having that discussion. I hope it takes place—it would probably be in several months rather than immediately, but it is really important.
If you go out of here and kick yourselves and think, “Oh gosh, I wish I’d said that,” you can always write to the Committee.
Helen Browning: Yes, I would like there to be an organic conversion scheme and ongoing payments for organic farmers in recognition of the public goods that they continue to deliver. That is a very cost-effective way for money to be deployed. It would be really helpful.
We are languishing right at the bottom, now, of the European league table in terms of the amount of food that is produced in this country that is organic, compared with our neighbours. There is so much potential, with what is happening in places such as Italy. Italy is 15% organic now. It is remarkable: in public procurement schemes in Copenhagen, 75% of the food must be organic that goes into schools and hospitals. So many countries have really got behind it, and it is a really good vehicle for change, so I would like to see that as a key part of the proposition going forward. That will help to move us in that direction of net zero emissions, biodiversity regenerating, diverse food supply and getting rid of pesticides. I think all of those things would be hugely helped if we were to give more support to the organic sector.
Helen Browning: We are really struggling in some areas in particular. Arable crops and protein crops for feed, in particular, are in very short supply in the UK. We could triple or quadruple the amount we produce—probably more than that—and still not meet the market demand here; so there is a big opportunity.
It does require some structural changes for those big arable farms that are currently probably not thinking about it. They need to be thinking about reintroducing, probably, livestock to their farms. It would be a jolly good thing in a lot of those farms in the east of England. So there are some structural issues, but I think a real focus on encouraging more farmers in, where there is a clear market, would be really helpful. You have got to make sure it is market-led, clearly, but in some areas the market is massively under-supplied. There are great export opportunities too. I think it would be a key part of a vibrant future for the countryside if we were to get behind organic farming more thoroughly —and agroforestry, as I mentioned earlier.
Helen Browning: I think it would be helpful because we are in a situation where we do not know so much of what is going to transpire over the next year or two. I think that there will be a huge amount more policy making to do, and this is just the starting point. What we must make sure of, with this Bill, is that it does not close off avenues that we may need open to us, depending on what happens to trade and the Brexit deal itself. It is base camp, and as everything else starts to become a little clearer, I think more consultation, as we start to look at the regulatory framework, would be really helpful.
Jack Ward: From our point of view, I think there is a case for saying that the lack of detail is not a bad thing, given the timescale we are working on and the need for this Bill to be in place before the end of March. The worst thing would be to rush forward with schemes and solutions that had not been properly thought through. We work very closely with DEFRA on the development of schemes, and in our experience it is really important that those who are going to operate them at ground level are part and parcel of the development process, because we have seen just how difficult it is to implement some of the EU schemes. God forbid that we go around the buoy of producing schemes that are inoperable, having designed them ourselves. I think there is an onus on all of us to work together to make sure these things work for the benefit of everybody involved, from taxpayer to grower, through to consumer.
Jack Ward: Yes, I think public procurement would be really helpful; but we have to recognise that we only produce a percentage of the total requirement. Inevitably, there are periods of the year, or there are crops, where it is not that easy to get locally grown produce, simply because it does not exist. We need to factor that in to our thinking. It is all very well to say, at a design level, “Yes, wouldn’t it be great if you specified that it had to be British?”, but eight out of 10 tomatoes are imported, so, by definition, they will not be local.
Helen Browning: I was surprised that soils were not mentioned explicitly in the list of public goods. As I said earlier, it mentions land but not soil. You are right that, on an R&D front, there is still a lot to learn on the biology side, but there is a lot that is already known that could be implemented quite quickly.
I was surprised because the Minister has been so vocal about soils. I would like to ensure that it is absolutely core within the Bill, that we are specific about that and that we start to set ourselves some targets for reversing the decline in our soil, particularly in the organic matter levels in our soil.
Helen Browning: Jack may want to come in on this as well. Generally, it would be about moving into more rotational farming systems, which is usually integrating grassland with growing cover crops. Reducing tillage can sometimes help, although it is not always the way through. Some of the agroforestry opportunities are there too. Rotational farming systems usually improve soil health.
Another is making sure that manures and other inputs are going back on to the soil. One of the things that I have a complete hysteria about is the burning of straw for fuel, when it should be going back to the land—that carbon should be going back to the land. It is about making sure that carbon-based inputs are being recycled into our soils and that we are not damaging those soils by over-heavy machinery, which is a big problem—I am looking forward to the days of little robots running around doing our work for us, rather than all the great machines that are crushing our soils to death—or about leaving soils bare over the winter or even during the summer months.
There is a whole host of well-known factors. A lot of those come together, obviously, within an organic farming system, which is demonstrated to have much higher levels of soil organic matter on average, which is the key indicator that we are looking at in our soil. We know how to do some of those basics.
Moving towards targets for soils at a farm level is difficult, because every soil type is different and will have different capabilities, so we need to be careful about how we use the metrics. We know enough about what husbandry methods we need to be encouraging, however. Good mixed farming is a good place to start.
Secondly, for the Soil Association, I met with your associates in Edinburgh, and they suggested that part of the problem with food security is the lack of security of supply of things such as fertiliser, and that true food security depends on a supply chain. Is there anything in the Bill that suggests to you that food security issues are being addressed?
Jack Ward: Most horticultural production falls outside the CAP, and traditionally it hasn’t been supported. It is very much about what sort of income you can generate from that production. I think that changes in the CAP and in funding, and the switch to public goods, probably will not impact that very greatly. The demand for seasonal labour will be there all the while people are sufficiently confident to keep investing in production in the UK.
Could you repeat that last bit?
Jack Ward: One of the big issues about the availability of seasonal labour is the continuing investment in production in the UK. What is happening at the moment is that, because of the uncertainty, everybody is just holding back on what they are prepared to invest and what they are prepared to do in the future. The last thing we want is to see some of that production move to where the labour is, whether in another part of Europe, northern Africa or wherever it happens to be.
Helen Browning: There is lots of talk about food security, and it is used in a number of ways by a number of people. I do not think food security is the same as saying that we need to produce it all here; sometimes food security might be sourcing from a number of different places, because they might not have the same climatic disaster at the same time. It might be about storage. I think that we need to use that phrase with some caution.
At the same time, the Bill de-links the production of food from the funding that will come to farmers—that is a very important dislocation that is being made. Currently, if you are in receipt of public money, you are required to produce food, effectively. You will no longer be required to do that, as I understand it from the Bill. The import of that needs to be thought through clearly. I think it is the right approach, because I do not think you should force farmers to produce food that people are not paying an adequate amount for—they would be running loss-making businesses. Over time, we need to take a view as to what sort of food system we want, how much food we should produce here, and how much we are prepared to offshore our environmental or social responsibilities to other countries in order that they feed us. These are big societal debates that we need to have, but we need to be very clear that what the Bill does is saying, “We pay you for environmental goods; you don’t any longer have to produce food to claim those payments.”
A quick, final question from Chris Davies, and a quick answer, please.
Jack Ward: We are particularly interested in the producer organisation—it is really important that we do not end up with four schemes. It will be a nightmare if we end up having to face four different directions and four different regulating authorities.
Do you agree, Ms Browning?
Helen Browning: Absolutely—I think that the more unity we have on these things, the better. Life is going to get complicated enough, so I urge collaboration wherever we can find it.
Thank you very much indeed, Mr Ward and Ms Browning. We are indebted to you for the time and effort that you put into coming to see us.
Ordered, That further consideration be now adjourned. —(Iain Stewart.)
Adjourned till this day at Two o’clock.