Tuesday 12 July 2022
[Mr Laurence Robertson in the Chair]
BBC Charter: Regional Television News
I beg to move,
That this House has considered the BBC Charter and the closure of regional TV news programmes.
It is a pleasure to serve under your chairmanship, Mr Robertson. When I was 15, I wrote to BBC Radio Oxford to say that it should make programmes for teenagers. Its reply offered me the chance to make those programmes myself. Thus began my career in broadcasting. After I had graduated, I worked for BBC News for seven years before moving to Channel 5, where I stayed for another eight years. I declare an interest: I have a background in broadcasting and spent a considerable period working for the BBC.
One of the things that made BBC Radio Oxford great when I was there was its connection to the audience. Its presenters, reporters and producers knew the local area, understood the local issues and related to the local people. That is the case now for the Oxford television newsroom, which each evening produces dedicated programming in “South Today”. The title sequence shows the names of the places that feature: Abingdon, Bicester, Brackley, Buckingham, Didcot, Witney and, of course, Aylesbury, my constituency. The Oxford programme has a dedicated presenter and a dedicated team of journalists who produce dedicated programming for their local audience, yet that programming is under threat.
At the end of May, the BBC announced that it will
“end the local TV bulletins broadcast from Oxford on BBC1 at 6.30 pm and 10.30 pm on weekdays.”
From November, regional coverage for the area will be merged with the “South Today” programme broadcast from Southampton. Instead of there being TV news for my area, the BBC says it will be
“strengthening its local online news services.”
The BBC has decided to do the same with its bulletins produced in Cambridge—scrap the TV programme and put the local news online instead. I know there are colleagues here today who are affected by that decision.
The BBC has a unique and privileged place in our country. It is funded by a licence fee that is imposed on everybody who owns a television set, irrespective of how much they earn and how much BBC output they watch, listen to or read. In return for that funding model, the BBC is governed by a royal charter that sets out the corporation’s responsibilities. The charter lists the public purposes of the BBC, and this is the first among them:
“To provide impartial news and information to help people understand and engage with the world around them: the BBC should provide duly accurate and impartial news, current affairs and factual programming to build people’s understanding of all parts of the United Kingdom and of the wider world. Its content should be provided to the highest editorial standards. It should offer a range and depth of analysis and content not widely available from other United Kingdom news providers, using the highest calibre presenters and journalists, and championing freedom of expression, so that all audiences can engage fully with major local, regional, national, United Kingdom and global issues and participate in the democratic process, at all levels, as active and informed citizens.”
The debate is not the place to discuss how fully the BBC complies with everything set out in that paragraph—there are certainly different views about how well it complies with the requirement to be impartial, for example —but I draw the attention of the House to certain key elements of the first of the public purposes of the BBC. Those key elements are to
“provide… news… to build people’s understanding of all parts of the United Kingdom”,
enable all audiences to
“engage fully with major local… issues”
and offer material
“not widely available from other United Kingdom news providers”.
I submit that, with its proposal to close the Oxford edition of “South Today” and the Cambridge edition of “Look East”, the BBC is failing to comply with those charter requirements.
The BBC needs to continue providing local news in the way people want to get it, because others have ceased to do so. Many local newspapers have closed in recent years. In August 2020, Press Gazette reported that, according to its analysis, 265 local newspapers had shut since 2005. Just last month, a report entitled “Local News Deserts”, published by the Charitable Journalism Project, set out a stark picture. It said:
“The current local news landscape of the UK is unrecognisable compared to 25 years ago…Average daily print circulation for the local regional and local press in 2019 was around 31%...of 2007 figures…The loss of revenue from print sales and the migration of advertising online has brought about successive shocks to the business model of local news. It has led to multiple title closures, redundancies, the ‘hollowing out’ of newsrooms, office closures and centralisation…Most local journalism is no longer written by separate editorial teams associated with a specific title.”
The report says that people
“want a trusted, locally based, professional and accessible source of local news, that reports and investigates local issues and institutions…provided by journalists local to their communities.”
The chairman of the project wrote in his forward:
“The collapse of local reporting is a slow-burning crisis in Britain.”
He pointed out that the income that kept local newspapers afloat in the past will not return.
That, then, is the picture for local print journalism, but it is not just newspapers that are leaving town. In September 2020, Aylesbury’s much loved and very widely respected commercial radio station, Mix 96, effectively closed down. It was subsumed into a new regional station called Greatest Hits Radio (Bucks, Beds and Herts), owned by Bauer. The dedicated team who had served Aylesbury with news, current affairs and local information were no more. The studios in our town have closed. Bauer promised that there would still be coverage of Aylesbury stories, but there are far fewer than there were. The reporters who lived and worked locally have gone.
Of course, I recognise that the way we get our news is changing. Many of us use our phones, for example, to see updates on Twitter or Facebook, but there is still a sizeable audience who want to get their local news from a local television programme, and that is especially the case for older people. Indeed, the BBC itself says that 75% of the viewers of “South Today” are over the age of 55. While many people in that age bracket are highly digitally savvy, plenty of others are not, and they should not be cut off from what is happening in their local area. They should still have access to information about local news. They should still be able to see their local politicians being held to account on their television screens.
Instead, with its latest proposals, the BBC plans to subsume the news from Aylesbury into a programme from Southampton. Frankly, stories about sailing and the coast are not terribly relevant to one of the most inland towns in England. The simple truth is that people in Witney do not have a great deal in common with people in Winchester. News about the havoc caused by HS2 in Buckinghamshire is not very high on the agenda of those who live in Bembridge on the Isle of Wight. The BBC is proposing to create a TV region that simply has no geographical identity. The result will be even lower audiences, as people tune out from a programme with stories to which they simply do not relate. This matters.
The broadcasting regulator, Ofcom, also highlights the importance of television as a source of news. Its most recent report on news consumption says:
“TV remains the most common platform for accessing local news.”
“Use of TV is most prevalent amongst the 65+ age group, while the internet is the most- used platform for news consumption among 16-24s…BBC One remains the most-used news source across any platform”.
It is twice as popular as the BBC website and app: the figures are 62% for TV, 31% for online and app. Yet, the BBC wants to close its TV programmes, and put the content online.
The BBC says that when it closes its Oxford and Cambridge TV programmes, it will devote more resource to its local radio stations. But Ofcom says that fewer than half the population now use the radio for news—it is just 46%, whereas 79% use television. Again, the BBC is knowingly cutting programmes from a platform it knows is used and relied upon.
Some may say that this Government’s decision to freeze the price of the BBC licence for two years has forced the corporation’s hand. It is true that the BBC will have to make some cuts in some of its expenditure, but not in this case. The acting director of BBC England told me in simple words, “This isn’t about savings. I haven’t got to save a single penny.” In the correspondence I received from the BBC to tell me that it was planning to close the Oxford programme, it is confirmed:
“The BBC will be maintaining its overall spend on local and regional content in England over the next few years.”
Let me repeat that: the planned closure of BBC Oxford’s “South Today” programme is not driven by the need to save money. Instead, the British Broadcasting Corporation wants to shift more of its output online and away from television.
Having been a journalist and always wanted to hear two sides of the story, I went to the BBC to ask it to put its case. When I asked what evidence it had that people in my local area wanted to get their news online instead of on screen, I was told it would take some time to gather all that information from various sources. That was from the director who had made the decision to close the service. I was a bit surprised that he did not have the facts at his fingertips and could not immediately tell me the justification and why he felt that it was needed or desired, so I waited for a mass of evidence to arrive from various sources.
After 10 days, I got one page. It could not be said to provide the compelling facts that I had eagerly awaited. First, it set out some raw numbers. The BBC said that the average number of viewers for “South Today” was considerably lower in 2022 than in 2020. In 2020, however, all regional news programmes experienced a big increase in viewers because of the pandemic—a point proudly emphasised by the BBC in its annual report—so it is somewhat disingenuous to take that specific high point as a comparator to justify cuts now. Indeed, the BBC told me that the decrease in viewing of regional news programmes is happening more slowly than the decrease in viewing of other programmes.
On my one page of evidence, there was a single paragraph that could perhaps be said to touch on digital versus traditional ways to get local news. It said that the BBC’s own qualitative research showed:
“Amongst older respondents (55+) there has been a long-term trend away from traditional platforms (especially print media) and towards online sources, most significantly Facebook.”
The BBC added:
“This is supported by Ofcom data which reveals over 55s are as likely to access news online as through radio or print. This group expects to be able to access tailored local news online.”
Those listening closely will have heard two references to print and one to radio, but the word “television” is not mentioned in the evidence that the BBC provided to support its decision to cut a television news programme. It certainly did not say that older viewers were switching away from TV news, let alone that they wanted to do so and get their local news online instead. In fact, it says that of the weekly visitors to BBC News Online, 37% are aged 55 or older—in marked contrast to the 75% aged over 55 watching “South Today”—so there are serious concerns about older people being able to get easy access to increased online local news. I should also mention that there is a threat to the jobs of those who have dedicated years of their lives to producing high-quality local TV news. They have not been guaranteed new posts, and they should not be forgotten.
The BBC is a British institution. It does a great deal of good for our country, and I am very proud to have worked there. Its role providing news and information is crucial to our democracy, but with its plans to cut dedicated news programmes on television in the Oxford and Cambridge areas, it will reduce access to local news and information for many people. For the reasons I have set out this morning, I believe that contravenes its charter requirements, which is why I say it is not simply a day-to-day operational decision for the BBC, but a matter for this House and the Government. I look forward to the Minister’s response.
It is a pleasure to serve with you in the Chair, Mr Robertson, and to follow the excellent introduction by the hon. Member for Aylesbury (Rob Butler). It was very thorough and considered. I suspect that this is one of those occasions on which people in both his and my part of the country can speak with one voice. I will make broadly similar points to his, but more in reference to Cambridge.
This issue is part of a wider debate about the BBC and how our major news programmes and broadcasters will cope with the challenges of the future. I am not entirely sure that it is our place as politicians to dictate to the BBC how it should run things. On the other hand, it is very important that it hears from the public and their representatives about the likely impact of these changes. I am sure I am not the only one in this House who regularly receives comments from constituents along the lines of, “Oh, I saw you on the telly the other day.” It is generally followed by me saying, “What was I talking about?” and they have no idea. Some of them say, “But I’m sure what you were saying was very sensible,” and others say something very different, of course.
I am struck by the number of people who respond when I have been on “Look East” or “The Politics Show”, compared with when I stuff leaflets through their door or even get pieces in print or on the radio. Television really matters locally, for the reasons that the hon. Member for Aylesbury explained: with the decline in print media—in Cambridge, we are fortunate still to have a daily paper—journalists struggle, because it is harder and harder, and there are fewer and fewer of them. Much less investigative journalism is done now, compared with when I started on my trail in Cambridge 20 years ago. The investigative journalism that I have seen in the past seven or eight years, since I have been in this place, has come from the BBC at a regional level.
I draw a bit of a distinction between the BBC at a national level and a regional level. I increasingly find myself watching “ITV News at Ten” these days, because I think the BBC has been too supine in its approach to the Government over the past few years, but at a local level the regional journalists are superb. They are incredibly professional and they produce really good programmes that people like, watch and identify with. It is invidious to name particular journalists, but one who stood down, Stewart White, was a legend in the east of England. He was a friend in the sitting room to many, many people.
The question today is whether the BBC is right to make these changes to its regional output. I and other political leaders in the region have written to it asking it to think again. The introduction of the west-east split a couple of years ago was a big plus—certainly for politicians, as it meant that we got covered more because more journalism was being done and there were more opportunities—and it dealt with the difficult problem, which the hon. Gentleman alluded to, of regional identity.
There is a bigger debate to be had about regionalism, but I have always said whenever I have met the broadcasting companies that, to some extent, the TV regions define the east of England. It has long been argued whether the east is six counties, three counties or whatever, but the TV region really matters because that is what people see coming into their kitchens and homes. The split was a really good step forward, so I cannot say how disappointed I was to hear about these changes. Whatever one feels about the wider questions of whether this is the way to reach people in different demographics and whether people pick up more of their news digitally, this will mean less local journalism—there are no two ways about it—and that is bad for democracy. At a time when our democracy is, frankly, struggling in lots of ways, this is a step backwards.
There are some other factors particular to the east. The census figures from a couple of weeks ago revealed what many of us had known for a long time: the Cambridge sub-region is growing at an extraordinary rate. I have stood in this very place and argued with Ministers about public service spending and allocations. The Cambridge region is woefully under-resourced because the figures fail to keep up with the reality on the ground, and that is borne out by the most recent census figures. It is one of the fastest growing regions in the country, and the BBC is turning away from it. That makes no sense.
So I say to the BBC: please, you have an opportunity. Suddenly, the whole world is changing in front of your eyes. You do not have to be cowed by the Government who have just gone. A new Government are coming along, and another will come along after that. Spot what is going on, think hard about what the future looks like, and listen to the people who represent those who pay the licence fee. I think that if the BBC listened to those people, it would come to a different conclusion. There is still time to stop this change.
It is a pleasure to serve under your chairmanship, Mr Robertson. My hon. Friend the Member for Aylesbury (Rob Butler) has been far too modest about his achievements in broadcasting. It may come as a surprise to some Members, but he taught me all I know about broadcasting on both sides of the table. I remember appearing before him at the BBC as an interviewee, and a little later succeeding him as the presenter for BBC World Service Television broadcasts. Being a presenter for World Service Television meant that we could walk down a high street in the UK and not be recognised. However, when we got off a plane in Delhi, we were absolutely mobbed—an interesting experience.
We need to look at what right the BBC has to organise its own services. I would not want to ban the BBC from organising its own services or looking at the competition that it faces, which includes, as we have already seen, things such as Facebook, which I will come back to in a minute. It is right for the BBC to look at how we as consumers use TV and radio, but it is important for us as politicians to stand up and say what we value most in our television broadcasting, and what it would be a great shame to see end. For me, that starts and almost finishes with investigative journalism at a local level.
I am not saying this because I use “South Today” and BBC Radio Oxford, as I am sure my hon. Friend the Member for Aylesbury does as well. It is not for want of another forum for expressing our views, but—I pick up the point made by the hon. Member for Cambridge (Daniel Zeichner)—when both Oxford and Cambridge are expanding so quickly and so much, it is extraordinary to see the BBC turning its back on them.
I accept the point about costs, but one question that will have occurred to the BBC is that investigative journalism is not cheap to run. It requires a lot of human costs and takes an enormous amount of time to make it work. Journalists have to go out and see, talk to and film people. When they get back to the studio, there is all the editing of the tapes as well, but the product is much the better for that personal intervention. I wonder whether anyone at the BBC has undertaken an analysis of how it manages the important elements of the charter that we have already mentioned—the impartiality of the news and information—and manages to keep them current and in place in the fight with digital broadcasters.
If we compare television news broadcasts with Facebook, we are not comparing like with like. Facebook is incredibly biased, and Twitter even more so. If that is the way the BBC is going with its digital broadcasts, I want nothing more to do with it. Like the hon. Member for Cambridge, I no longer watch BBC TV news. It is anathema to me to see the values that my hon. Friend the Member for Aylesbury and I were imbued with simply wasted, and I do not see that as a good line for the future. The impartiality point is a crucial one, and one that my hon. Friend did not touch on much. However, I think it is a point that we need to get right if the BBC is to make a change. I have seen nothing in the thinking of the BBC about how, in a digital age, it will preserve its impartiality. If we look at today’s news online as an example of that, there is absolute relish in the idea that tomorrow there will be a vote of no confidence in the Government. There is no objectivity about it; it is a piece of gratuitous journalism—if I can call it journalism—that does the BBC no credit whatever.
There are many aspects to the problem, and we can only touch on a few of them. However, I think it is important that we restate our commitment to local investigative journalism, which I agree does a tremendous job. I have seen such journalism at a local level develop into large-scale news programmes, because of the careful work undertaken by local journalists. I have no idea what I am going to do when I finish in Parliament. I will probably not go back into broadcasting, but if I were to, I hope that I would find the values that my hon. Friend the Member for Aylesbury and I grew up with still alive and present in whatever form the BBC takes, but I sincerely doubt that that will be the case.
It is a pleasure to serve under your chairmanship, Mr Robertson. I will bring, as is my wont, a highland perspective to this short debate. I congratulate the hon. Member for Aylesbury (Rob Butler) on a thoughtful contribution. I say to the hon. Member for Henley (John Howell) that if he is short of things to do when he decides to leave this place, he is welcome to come and do some investigative journalism in the highlands of Scotland. Twenty years ago we had a half-hour bulletin from BBC Inverness; today we just have a five minute one. That has seen an erosion of investigative journalism and the coverage that was so good 20 years ago. I regret that enormously.
Of course I welcome and acknowledge the contribution that the BBC in the highlands makes to the Gaelic language. It has a large team of perhaps as many as 20 people, who are important to arresting the sad erosion of the language, but we now have about seven broadcasters speaking English covering the vast geography of the highlands.
I make the simple point that in the highlands we have challenges of distance and sparsity of population. Investigative journalism is important to enable the functioning of democracy—be it the Highland Council, NHS Highland, or the doings of a Member of the Scottish or Westminster Parliaments—but we do not get the coverage that we used to 20 years ago. That is not a complaint about me not being on air as much as I could be. The point is, in the past, if someone was not doing their job properly, at whatever level they were at in politics or the NHS, the BBC’s investigative journalists would dig it out and flap it around.
I remember coming a cropper; I learned a very hard lesson 25 years ago as a local councillor. I went on the BBC and said that the amount of money that we were proposing to increase councillors’ expenses by was absolutely shocking—it was a proposal from the Administration. A journalist, very adroitly replied, “Will you be taking the rise, Mr Stone?” I coughed, spluttered and had to say, “No.” I learned the lesson to beware journalists. However, it was a testing question and it needed to be asked.
I point out, anecdotally, that my former party leader, Mr Charles Kennedy—of happy memory in this place—started his career with the BBC in Inverness. I remember his voice broadcasting. I think he honed many of his skills that proved invaluable in this place through that work, as did the hon. Members for Aylesbury and for Henley. It augments what these people do.
I talk about the news coverage and the aversion to what is happening, and I very much hope that one day the cuts can be reversed. It is odd, is it not, Mr Robertson, that Orkney has a half-hour coverage of news and so does Shetland, whereas the whole of the highlands has one short bulletin? I say to BBC Scotland that something is wrong with its planning in that regard and I hope it will be looked at again.
In the past, programmes were made in Inverness. There was one called “The Kitchen Café”, which was very popular, and got local people involved and on air. I see the UK like a diamond; every facet is slightly different. British people do not particularly enjoy being homogenised all together, into one exact sameness. We enjoy hearing about the different ways that things are done in Oxford, Cambridge, the highlands or Wales. We love that; it is part of being British. The erosion of regional programme making cuts into that, and I regret that enormously because it is part of the British psyche and the way in which we do things.
When I was first elected as a Member of the Scottish Parliament, I took part in one of those shows. Every Monday I would have a 10-minute slot, which was rather hilariously called “Stone of Destiny”, in which I would talk about the Scottish Parliament, which had just then been set up. It may seem ridiculous to experienced Members, but I had to explain how Hansard worked and what a pager was—we do not have pagers now. Of course, the title came to be used against me by an independent candidate in one of my elections up in Scotland, who called me the “Stone of density”. The humble crofters in the township of Rogart were rolling in the aisles at that one! Again, it was good because the new democracy in Scotland was being aired. I hope I helped to explain it to people, and that they enjoyed it.
I will add one last thing. I hear the arguments expressed on the Government Benches, and I do not know if it is about the cuts or the licence fee, but I do know that something as basically important to being British and the way we do things—British democracy—is eroded and damaged by the cutting back of regional investigative reporting.
It is a pleasure to serve under your chairmanship, Mr Robertson. I thank the hon. Member for Aylesbury (Rob Butler) for raising this important topic. I welcome the Minister, who I see has been reshuffled back to where he rightfully belongs.
There are those who complain about BBC left-wing bias, so it is good to see two former BBC News anchors, both elected as Tory MPs, joining a Tory donor as BBC chair and a former Conservative party candidate as the director general. My colleagues, the hon. Members for Aylesbury and for Henley (John Howell) talked about their history at the BBC. I must declare some bias, because I was a BBC News reporter and anchor. I presented “BBC Breakfast” for a number of years, and was a reporter on “Newsnight” and other programmes. Every morning I found myself saying “Over to you, Rob” on “BBC Breakfast”, where the hon. Member was a much respected BBC business correspondent.
I also began my career by writing in and saying that I was interested in news and current affairs. I wrote to Janet Street-Porter, who invited me for dinner. I was ridiculously overdressed. She was ridiculously underdressed. She asked me if I would like to front youth programmes. I was shortly afterwards rejected for John Craven’s “Newsround” on the grounds that I was not boyish enough; I think I was 21 then and John Craven was probably approaching his 70th birthday. He was the editor at the time and took that brutal decision.
Politically, culturally and socially, as we saw through the pandemic, the value of the BBC is immense. It reaches every part of these islands and every demographic in them. Whatever people’s views on the shortcomings of the BBC—there is disquiet about some of its news direction, especially in Scotland—there can be no doubt whatever about its importance to our national life.
One of the proudest boasts of the BBC has always been its strength in depth, especially in local news and regional journalism, so the closure of regional news programmes and the accompanying job losses are tragic. However, they have almost certainly been inevitable, since the Government bullied the BBC into taking on responsibility for a social service: TV licence provision for the over-75s. A stronger director general would have resisted the bullying or even threatened to resign. One previous director general did precisely that, and the BBC board threatened to resign. I think I am right in saying that it was a former Chancellor of the Exchequer under the Cameron premiership who put the pressure on.
Alas, under Tony Hall, the BBC succumbed to the pressure and signed up for a disastrous deal. The deal, agreed behind closed doors between Baron Hall and the UK Government, places the burden of licence fee payment for the over-75s on the BBC, and it should never have been so. The BBC is a broadcaster. Its job is to deliver public service broadcasting. Without doubt, it is right that the over-75s should have their licence fees paid for, but it is the Government’s job to fund that.
When Tony Hall came before the Digital, Culture, Media and Sport Committee, on which I sit, he claimed that his staff were delighted with the deal. I said, “Well, you’re obviously not talking to your staff, because I can tell you that they’re not.” From spending a moment with any member of staff from the BBC, it was clear that they thought there would be huge job cuts if the BBC took on this responsibility. I predicted the job cuts, and I am sad to say that I was right. Those cuts have also come with a cut in services, as the hon. Member for Aylesbury has outlined.
With more cuts comes less choice and a less informed public. That is bad at a time of widespread disinformation, and especially during the pandemic. In Scotland we have our own specific concerns about funding. During the Select Committee’s pre-appointment hearing of Richard Sharp as BBC chair, I asked Mr Sharp why only 80% of the licence fee raised in Scotland was spent in Scotland. I wrote down his answer. He said, rather phlegmatically,
“You can ask me, but I do not have the answer.”
That was admirably honest.
Last autumn, after Mr Sharp took up his post as BBC chair, I asked him again if he had learned the answer, having been in the job for some time. Once again, he told me that he did not have it, but that as a result of covid the figure had actually gone down. Tim Davie, when appearing before the Select Committee, told me that the percentage of the licence fee raised in Scotland that is spent in Scotland has dropped to only 67%. Clearly, that does not align with the BBC’s pledge to better deliver value for all audiences.
A Culture Secretary hostile to our public service broadcasters and underspending in Scotland means that Scots can be forgiven for having a pessimistic view of the BBC’s future. Given that I spent the formative years of my career at the BBC, issues affecting its future are very important to me, as I know they are to Members across the House. I will continue to argue for the devolution of broadcasting, but until that time comes, BBC management needs to do all in its power to resist further cuts by the Conservative Government. With our current Culture Secretary at the helm, and the history of political interference at both the BBC and Channel 4, those of us who champion public service broadcasting have cause for concern.
It is a pleasure to see you in the Chair, Mr Robertson, and to be speaking in this debate on behalf of the Opposition. It is good to see the Minister back in his place. I want to speak about the wider issues around the charter and licence fee as well as the issues we have heard about local news in the south-east. I congratulate the hon. Member for Aylesbury (Rob Butler) on securing the debate and providing a good overview. As a former broadcast journalist, he speaks with authority and is acutely aware of the importance of having well-resourced public service broadcasters delivering for local people, particularly in the light of the decline of local print journalism. He made some interesting points about striking the right balance between local TV news and digital provision in the digital age.
For the BBC to remain a world-class institution, it needs to be properly resourced so it can deliver for the digital age and beyond the 2020s. When the Secretary of State announced the licence fee freeze in January and suggested that it might be the last licence fee settlement—which happened just as Operation Save Big Dog commenced and, indeed, perhaps as part of it—we were worried. Thankfully the licence fee has lasted longer than Big Dog, but after—as usual—briefing the media first, the Secretary of State eventually made a statement to the House and told us about the freeze. She intimated that the licence fee would end in 2027 and, in future, the BBC should look to the models of American streaming giants, such as Amazon or Netflix. Since then, Netflix has lost over 200,000 subscribers and seen its share price fall by over 60%.
As well as the increase in the subscription cost, another key reason why subscribers are turning away in their droves is the lack of original and distinct programming being commissioned by the streaming giant, with many saying that the subscription was no longer value for money. Netflix announced last month that it has to lay off 300 employees. Is that the future the Government want to see for the BBC?
The past few months have demonstrated the instability and volatility of a streaming model. It would not deliver the long-term security and stability for the BBC that the Government claim to be the objective. Labour values and cherishes our great British institutions, such as the BBC. The BBC is loved at home and envied around the world, but as it approaches its 100th birthday—when we should be celebrating its success—its future once again looks uncertain. It is worth reminding hon. Members just how much we get out of the BBC. It is not only a news and broadcast service envied around the world, it provides a huge number of skilled jobs for people the length and breadth of the UK. It gives us a sense of—particularly regional—identity and unity, and that has been reflected in today’s contributions.
The BBC has a diverse range of content across multiple platforms, which appeals to people of all ages, areas and backgrounds. It is because of the licence fee that BBC Bitesize came to the aid of 5.8 million children during lockdown as parents juggled work with the challenges of home schooling. BBC content creators pulled out all the stops to continue educating our young people during the biggest public health crisis in a century. It is far more than just a producer of programmes; it is a curator of content from children’s television to hard-hitting documentaries and in-depth global news reporting. Of course, the digital and streaming revolutions are upon us, and the BBC must continue to keep pace with the changing media landscape as it has done with BBC iPlayer and BBC Sounds. However, the Government need to be clear about how the broadcaster will be funded beyond 2027.
With inflation running at a 40-year high and in the light of the licence fee freeze, the broadcaster has already had to start prioritising some sorts of programming over others. Further delay will only lead to British jobs and content being outsourced abroad. As the shadow Secretary of State, my hon. Friend the Member for Manchester Central (Lucy Powell), said,
“cultural vandalism is not patriotic.”
The BBC is one of the most powerful aspects of our soft power. Around the world the BBC is trusted and respected for its impartiality, professionalism and skilled reporting. Nowhere has that come more to the fore than in its reporting on Russia’s criminal invasion of Ukraine. The Government like to talk about the UK being a soft power superpower, but how can that status be enhanced or maintained when they place such uncertainty on a cultural institution as important as the BBC? It is the only public service broadcaster from any country that reaches half a billion people a week.
Many questions remain on the future capability and ability of the BBC to continue as a world-class news broadcaster. It is still unclear how the merger between BBC News and BBC World News will look in practice and what effect that will have on how much it can cover, particularly when it comes to investigative international reporting. Our international news reporting is the envy of the world but, as we have heard clearly from around the Chamber, we must remember the dedicated teams and crews that make up local news reporting across the United Kingdom. Local news reporting is such an important grassroots component of the BBC, connecting communities to the issues happening locally around them. I therefore agree that it is disappointing that, as part of the digital first strategy, local news coverage is being squeezed, with dedicated frontline reporting one of the casualties.
As we have heard, local news bulletins on BBC One in Cambridgeshire and Oxfordshire will be scrapped, with a single pan-regional edition of “South Today” from Southampton taking their place and covering the whole region. The recently launched regional investigative news programme “We Are England” is also to be scrapped barely a year after it was commissioned.
My hon. Friend the Member for Cambridge (Daniel Zeichner) and others talked about the importance of the local aspect of news reporting, and many communities outside the big cities will fear that with a reduction in frontline journalists and more regional programming, they will become merely a footnote in the broadcaster’s output. The BBC says that it will keep its news gathering teams in both the Oxford and Cambridge hubs, but I absolutely understand the worries expressed by Members from those areas that they will not have their own dedicated regional coverage.
An increased digital presence is welcome in the modern age, but it cannot replace journalists on the ground in their communities, reporting for their communities, understanding the issues on the ground and reflecting them in regional coverage. The Government say that their priorities are to ensure that the nations and regions of the United Kingdom, and not just London and the south-east, are prioritised for jobs, infrastructure projects and economic development. The BBC’s Media City in Salford, close to my constituency, provides more than 3,000 skilled jobs and has helped to foster a dynamic economic cluster. I have to say that it has raised house prices in my constituency. That would seem a model example of what levelling-up looks like in action, creating more skilled jobs and roles outside the capital.
To appreciate the BBC, we should look at the statistics. BBC services are used by nearly 100% of UK adults every month. The BBC is the most popular media brand among young people, reaching 80% of young adults on average per week. Over the covid period when schools had to shut their doors and move online, millions of families discovered the brilliance of BBC Bitesize.
Even those who are sceptical of the BBC, when tested, had a new-found respect for it. The BBC recently published the findings of a deprivation study in which 80 homes had no access to BBC services or content for nine days. It found that 70% of those who initially said they would rather do without the BBC, or prefer to pay less for it, changed their minds and were willing to pay the full licence fee or more to keep BBC services and content.
Rather than the constant sniping and funding insecurity that we see under this Government, a Labour Government would work towards a long-term settlement that would ensure that our great British content and great local reporting could survive and thrive. We would talk up rather than kick down the brilliant reporters, presenters, musicians, actors and technical staff who make our soft-power giant what it is.
The licence fee still represents excellent value for money for consumers, so the Government need to confirm that any future funding model that they might contemplate will continue to offer viewers and listeners so much and such value. The BBC needs clarity about its future so that it can continue to modernise and continue to inform, educate and entertain for the next 100 years as it has done so brilliantly for the past 100 years.
It is a pleasure to serve under your chairmanship, Mr Robertson, and it is a pleasure to be back, however briefly. I thank hon. Members for their kind words.
I feel that I should join the ex-journalist fest. As a former journalist, I never had the pleasure of working for the BBC, but my first job was to be paid to watch its output. I promise that, as a first job out of university, being paid to watch television is less fun than it sounds, but it is pretty unusual. Among a whole host of other things, I covered the launch of BBC iPlayer in 2007 as a journalist, and in some ways I think that tells us how far the BBC has come and how much it has changed since then. It is as much a technology company as a broadcaster.
The thread that runs through all of that period, and which predates it by some way, is the value of regional news output. I think that the continued preservation of that output is something we would all like to see the BBC look to. The Government would, of course, like to see it preserve and enhance its regional output as much as possible, but that is a matter for the BBC. We have all paid tribute to our local news organisations, but I could not stand here without mentioning the giant that is Peter Levy on “Look North”.
Turning to the substance of the debate, as the Secretary of State and many others have said, the BBC is a global British brand. The Government want the BBC to continue to thrive in the decades to come and be a beacon for news and the arts around the world. The royal charter, underpinned by a more detailed framework agreement, guarantees the BBC’s current model as an independent, publicly owned, public service broadcaster.
Has the Minister been struck, as I have, by the similarity between what we are asking for for local investigative journalism and how the brand operates at a global level? It seems that at the global level the BBC has appreciated that it can only achieve its aim by investigative journalism and working in small groups, which is to its credit. We see that every day on the television.
I wonder whether my hon. Friend has read my next paragraph. The value that we have seen recently from the BBC in the reporting on the crisis in Ukraine is not the whole story. We have to look at the huge value it adds in its heroic reporting and investigating of local issues just as much as its value on the world stage.
The charter and framework agreement set the BBC’s mission and public purposes, which establish the BBC’s responsibilities and what it must do. Those responsibilities include the provision of impartial news and information to help people understand and engage with the world around them—of course, that is a world that is experienced locally, nationally and internationally.
On 17 January, the Secretary of State announced in Parliament that the licence fee would be frozen for the next two years. The BBC will continue to receive around £3.7 billion in annual public funding, allowing it to deliver its mission and public purposes and continue doing what it does best. Under the terms of the charter, the BBC is operationally and editorially independent from Government—quite right, too. As Members have acknowledged today, there is no provision for the Government to intervene on the BBC’s day-to-day operations. That means that it is for the BBC, subject to Ofcom’s regulation, to decide how best to use its funding as it delivers its remit and meets its mission and public purposes. Of course, as my hon. Friend the Member for Aylesbury (Rob Butler) implied, as Ofcom is set up by the Government, there is a role for the Government within this. However, I have to stress that Ofcom regulates that aspect of the BBC, rather than the Government.
On 26 May 2022, Tim Davie set out his vision for keeping the BBC relevant and offering value to all audiences in the on-demand age, with a particular focus, as has been referred to, on a digital-first BBC. This included an announcement that while the BBC will maintain its overall investment in local and regional content, some services and bulletins will be merged or ended, as we have discussed today. In the BBC’s explanation for this change, it set out that a small number of changes to its regional TV output will help strike a better balance between broadcast and freeing up money to invest online.
The announcement also confirmed that the BBC will continue to support the local news sector through the £8 million it spends each year on the local news partnerships and the Local Democracy Reporting Service, and that it will increase investment in local current affairs by creating a new network of journalists to focus on investigative journalism in communities across England. Of course, the Government welcome the maintenance of support for the LDRS during this charter period. It is an effective model for collaborative working between the BBC and local commercial news outlets.
As the BBC’s independent regulator, Ofcom is responsible for setting out the regulatory conditions that it considers appropriate for requiring the BBC to fulfil the mission and public purposes that my hon. Friend the Member for Aylesbury referred to. Those conditions are set out in the operating licence, and Ofcom is conducting a public consultation on proposed changes to the current licence.
The Government firmly believe that public service broadcasting plays an important role in reflecting and representing people and communities from all over the UK. The BBC has a particular role to play and must ensure that it meets the responsibilities set out in its charter. That will be regulated by Ofcom, including through an annual assessment of the BBC’s performance.
Regional news and local current affairs play a vital role in bringing communities together—as the hon. Member for Cambridge (Daniel Zeichner) said—and providing shared experiences across the UK. In that context, we recognise the continued requirement for the BBC to produce and schedule regional news programmes on traditional platforms. The value of television remains immense; whatever the changing figures of its reach, for a large number of people, it is obviously hugely and uniquely valuable.
We also recognise that the remits of all PSBs, including the BBC, must be updated to reflect the rapidly changing sector, where that mixture of online and digital distribution is of increasing importance. We therefore welcome Ofcom’s consultation on the BBC’s operating licence to ensure that the BBC continues to be allowed to innovate and respond to changing audience needs through greater recognition of those online services. We look forward to seeing the consultation’s results in due course.
It goes without saying that the BBC needs to consider whether local news meets the needs of local communities. That is, of course, its ambition and what Ofcom looks to ensure that it achieves. However, in my own community for instance, people in Boston will think that Hull is a very long way away, just as people in Oxford and Cambridge may think they do not have much in common with the Isle of Wight, as the hon. Member for Cambridge pointed out.
Among the actions we are taking to support the sector, we have committed to a series of measures that we intend to deliver through a media Bill. It will support PSBs by updating decades-old rules to give them more flexibility in how they deliver on their remits across their services. They will also have their online prominence guaranteed.
While there are some excellent examples of effective news services provided by local TV, the picture is more mixed for local TV as a whole. A number of local stations have been granted permission by Ofcom over the past few years to reduce local news and local content production to sustain services. By the end of the year, we will consult on the process for licensing local TV after 2025, and will gather views on whether to offer renewals, and the terms under which they should be offered. We will consider whether to set minimum local news requirements as a condition of renewal.
The Government also fund the community radio fund, which gives grants to help fund the core costs of running Ofcom-licensed community radio stations, such as management and administration. As my hon. Friend the Member for Aylesbury mentioned, those radio stations reflect a diverse mix of cultures and interests and provide a rich mix of mostly locally produced content, typically covering a small geographical area. Their value in the mix cannot be overstated. However, specifically on the BBC, we are evaluating how the BBC and Ofcom assess the market impact and public value of the BBC in the local news market through the mid-term review.
To conclude, noting our manifesto commitment to support local newspapers as vital pillars of our communities, it is important, in a debate about regional TV programming, to consider the sustainability challenges faced across the broader local news market, and the extent to which the BBC can help. My hon. Friend will be aware that the Digital, Culture, Media and Sport Committee is conducting an inquiry into the sustainability of local journalism, and I look forward to seeing its report in due course.
We all know that the BBC is a great national institution; we all want to see it thrive. Over the past 100 years, as has been said already, it has touched the lives of almost everyone in the UK and made a unique contribution to our cultural heritage. The Government are clear that the BBC must continue to adapt if it is to thrive in the decades to come, but, of course, we all want to see it serve local, regional and international audiences to the best of its ability. I think we would all like to see it define that in ways that are understood by the general public.
The BBC needs to represent, reflect and serve audiences, taking into account the needs of diverse communities of all the UK nations and regions. It is vital that the BBC continues to meet that requirement, and it is vital that it is held to the highest standards in doing so. On that note, I congratulate my hon. Friend the Member for Aylesbury on securing the debate, which has been an important part of holding the BBC to those standards, alongside the work of Ofcom and others.
I am glad to have had the opportunity to raise concerns in the House of Commons about the BBC’s axing of the Oxford edition of “South Today” and the Cambridge edition of “Look East”, and to set out why I believe that is in contravention of the BBC charter. Axing those dedicated programmes will make a fundamental difference to the way in which people in the areas around Oxford and Cambridge find out what is happening, why and who is responsible.
There has been remarkable cross-party support from hon. Members for local journalism from the BBC. Those who have spoken today did so with a common sense of purpose and of valuing the BBC. The hon. Member for Cambridge (Daniel Zeichner) highlighted the BBC’s investigative news at local and regional levels, and the disappointment in his local area, which there is in mine, over the plans to close the programmes that we have been discussing, as well as the irony of the BBC turning away from a fast-growing sub-region. A similar point could be made about Aylesbury, where tens of thousands of new homes are due to be built in the coming years.
I thank my hon. Friend the Member for Henley (John Howell) for his kind remarks about our shared background in broadcasting. He highlighted the significance of local investigative journalism and pointed out the lack of impartiality among other online sources of news.
The hon. Member for Caithness, Sutherland and Easter Ross (Jamie Stone) illustrated the impact of cuts to local BBC services in his area, vividly describing what happens in local communities when those services are cut. I hope that might give the BBC pause for thought.
From time to time, I shared a TV studio with the SNP spokesman, the hon. Member for Ochil and South Perthshire (John Nicolson). I do not share all his views on the BBC or many other issues, as he would expect, but I note that he had an experience similar to mine in preparation for today’s debate of struggling to get meaningful answers from the corporation.
Labour’s spokesman, the hon. Member for Manchester, Withington (Jeff Smith), underlined the significance of regional programmes in forging an identity. It is important to say in this conversation that local news reporting is a significant grassroots part of the BBC. It is a shame that it is being squeezed.
I am pleased to see the Minister back at DCMS, and I was glad to hear his support for regional news and that the BBC needs to consider whether local news really does meet the needs of local communities. I accept entirely his point that day-to-day operational decisions are for the BBC, not the House or the Government, but my concern is about the BBC’s compliance with the royal charter. Those concerns remain, and I hope BBC management will reflect on today’s debate. The BBC does some excellent work, and I hope that that excellence will perhaps stretch to its capacity to listen to its audiences, listening to Members who have spoken today, and reversing its decision.
I thank you for your chairmanship, Mr Robertson, and I thank all Members who have spoken today.
Question put and agreed to.
That this House has considered the BBC Charter and the closure of regional TV news programmes.
Free School Meals: Eligibility
In a moment, I will call Emma Lewell-Buck to move the motion and later I will call the Minister to respond. There will not be an opportunity for the mover of the motion to wind up, as this is only a 30-minute debate.
If anyone wishes to remove their jackets, they should please feel free to do so.
I beg to move,
That this House has considered eligibility criteria for free school meals.
It is a pleasure to see you in the Chair, Mr Robertson. There is nothing more grotesque than a Government who not only preside over thousands of children going hungry but who actively pursue policies that plunge them into hunger and poverty. As we debate the issue, nearly 4 million children in Britain are living in poverty, more than 800,000 are missing out on free school meals and hundreds of thousands are missing out on school breakfasts.
In my part of the world—the north-east—such figures are not decreasing but rising rapidly. Just this morning, the North East Child Poverty Commission revealed that our region now has the highest rate of child poverty in the UK, with 38% of our children now living in poverty. In South Shields, that rises to over 42%. It is clear that levelling up, just like the northern powerhouse before it, is a vacuous, empty phrase that was never intended to, and never will, do anything to improve the life chances of children in my area.
Hungry children, no matter how talented they are or how dedicated their teachers are, simply do not learn. When children spend their day worrying about where their next meal will come from, or about when their mams, dads and siblings will be able to eat again, their learning will inevitably be hindered.
The impacts of child hunger are well documented. Numerous studies have shown the links between nutrition and cognitive development. Hungry children suffer developmental impairment, language delays and delayed motor skills, not to mention the psychological and emotional impacts that can range from withdrawn and depressive behaviours to irritable and aggressive ones.
Pre-pandemic, we even saw rising numbers of hospital admissions for children through malnutrition and a resurgence of Victorian diseases such as scurvy and rickets. If it was not for the nearly 2,000 food banks in the UK—those are the ones we know of—as well as kind neighbours, faith groups and charities, many more children would simply have gone without.
When I was a child protection social worker, it was the children suffering from severe neglect who would be going without on such a scale, but now we have a generation of children for whom hunger and grinding poverty have become the norm. Back in 2019, the United Nations special rapporteur on extreme poverty and human rights visited the UK and found that the driving force of that Government was not an economic goal but rather a commitment to achieving radical social re-engineering and sending messages about lifestyles. His well-evidenced and thorough assessment was rejected outright and his recommendations were ignored.
When it comes to free school meals, what support the Government have put in place has been hard-fought for by charities, faith groups, Opposition MPs and celebrities.
I thank my hon. Friend for securing the debate and for the excellent remarks that she is making. Over 40,000 children in the city of Manchester are now eligible for free school meals. As the summer holidays loom, thousands of families in my constituency face the prospect of choosing between eating and paying rocketing utility and fuel bills. Does she agree that it is high time that the Government ensured that councils have the funding they need to support children and families during the school holidays?
It should come as no surprise to anyone that I agree with my hon. Friend completely; indeed, I will echo some of his comments later in my speech.
Let us just consider the Government’s abysmal record throughout covid. First, we had the ridiculously chaotic voucher scheme being contracted out to a private company; then the Government tried to withdraw support in the half-term and Easter holidays; and then when it came to the summer holidays, Tory MPs voted to withdraw support for free school meals, only to have their votes overturned when footballer Marcus Rashford shamed the Prime Minster into a U-turn. That was followed by meagre food parcels containing—for 10 days—a loaf of bread, half a cucumber, one pepper, a few potatoes, a block of cheese, four pieces of fruit and some salty snacks.
The holiday activities and food programme was again hard fought for from 2017 onwards, but it was not until 2021 that the Government decided to roll the programme out. Even now, the overriding focus of the programme is on activities, with a vast amount of money being spent on admin, bureaucracy and communications. If it had not been for the crowdfunding of my big-hearted constituents in South Shields, alongside Feeding Britain, KEY2Life, NECA and Hospitality & Hope coming together over those summers, children in South Shields would have gone without.
My fully costed school breakfast Bill would have seen nearly 2 million children start the day with full stomachs. Instead, the Government introduced a scheme that provides support to only 2,500 out of the 8,700 schools they have identified as eligible. Hungry children never have been and never will be a priority for the Government. If the political will was there, they would listen to the myriad voices from charities, organisations, faith groups, Opposition MPs, a few Members on their own side and Henry Dimbleby, who they appointed to lead the national food strategy. They are all pleading with the Government to at least expand free school meal eligibility to all families receiving universal credit or equivalent benefits. That would mean that a further 1.3 million children living in poverty would at least get a free school meal, and would also be eligible for the holiday food programmes.
According to the Child Poverty Action Group, that expansion would cost the Government an additional £550 million a year. The Minister knows as well as I do that that is small in terms of Government spending. Just look at the billions wasted on faulty personal protective equipment and gifted to Tory friends and donors for inadequate contracts throughout the pandemic, as well as the billions written off in covid fraud.
Furthermore, alongside that reform, the Government could introduce an automatic registration scheme for free school meals. At present, more than 200,000 children miss out because of the overly bureaucratic nature of the registration process. Those measures should then be followed by a move to universal free school meals for all children, as in Labour-led Wales, because no child should ever feel stigmatised or singled out.
I thank my hon. Friend for securing the debate, and for the incredible work she has done campaigning on this issue for many years. Does she agree that the bureaucracy and means testing for free school meals only increases stigma and also means that many children fall through the cracks and go hungry? Does she agree that the Government should look at providing universal free school breakfasts and lunches for all children in schools as a matter of urgency? The difference that investment would make to the education and lives of children in Liverpool, West Derby and beyond cannot be stressed enough. I have made that point to the Minister.
I thank my hon. Friend for the work he is doing on his Right to Food campaign, and all the work he does in his patch raising money for local food banks. He is right that there is another factor: means testing costs more. Universality is cheaper, and that is where the Government should be heading.
The hungry children are the children of key workers. Those key workers are working for their poverty. They are the key workers who kept us going and cared for our loved ones throughout the pandemic—they risked their lives for us. What chance do those children have when the newly appointed Under-Secretary of State for Education, the hon. Member for Bassetlaw (Brendan Clarke-Smith), along with his colleagues, voted during the pandemic to deny children free school meals in the holidays, and has said he believes that free school meals amount to “nationalising children”? He also went on to add that it was simply not true that people cannot afford to buy food on a regular basis, saying
“If you keep saying to people that you’re going to give stuff away, then you’re going to have an increase I’m afraid”.
I have a feeling that in his response the Minister will regale us with details of the cost of living support packages that the Government have put in place through previous support grants. The reality is that they are all one-offs; they are piecemeal, they are sticking plasters and they do little to address the root causes of child poverty. It should be to the utter shame of every MP in this Government that in a country as rich as ours, children are going to bed hungry and waking up hungry. I look forward to the Minister letting us know in his response what he intends to do to remedy that, because our children need and deserve better.
It is a pleasure to serve under your chairmanship, Mr Robertson. I congratulate the hon. Member for South Shields (Mrs Lewell-Buck) on securing a debate on this important subject. I echo the comments of other colleagues about her tireless work to raise awareness of the challenges that our most disadvantaged children face. Indeed, she raised this issue as recently with me as last Monday at Education questions, although it feels almost a lifetime ago.
Let me also put on record how pleased I am to be back at the Department for Education, after a 24-hour interlude. The hon. Lady knows how passionate I am about this work and how delighted I am to be able to continue it. She also knows of my long-standing interest in this issue, both in the past 10 months as Minister at the Department for Education and over the previous two and a half years as a Minister at the Department for Work and Pensions.
This Government are committed to supporting those on low incomes and continue to do so through many measures, such as spending over £108 billion a year on working-age benefit support and by recently taking wide-ranging action, to which the hon. Lady rightly pointed, to directly address cost of living pressures. She specifically referenced free school meals, and I will focus my comments on that area.
The Government and I are committed to providing free school meals to children from households who are out of work or on low incomes. This is of the utmost importance, both to me personally and the Government. Under the current criteria, there are around 1.9 million pupils who are eligible for and claiming a free school meal at lunchtime, which saves families hundreds of pounds per year per child. This number equates to approximately 22.5% of all pupils and is up from around 15% of pupils in 2015. The increases are due in part to the protections during the roll-out of universal credit. In making sure that these children receive a healthy, nutritious meal, we are helping to ensure they are well nourished, develop healthy eating habits, and can concentrate and learn—points that the hon. Lady rightly raised.
I thank the hon. Lady for that question. I have heard the call from the sector. We have increased funding for the universal infant free school meals rate to reflect this. Also, the core schools budget is increasing. I am acutely aware of the global inflation pressures. Schools are not immune to that. I will continue to work with the sector and with schools to ensure that schools are able to provide healthy, balanced and nutritious meals.
I mentioned the 1.9 million eligible pupils. A further 1.25 million infants are supported through the universal infant free school meal policy, as I just referenced. Already the greatest proportion ever of school children—around 37.5%—are provided with a free school meal at lunchtime, at a cost of over £1 billion a year. However, we do not stop there. Last year, more than 600,000 children were provided with healthy food and enriching activities through the holiday activities and food programme, which is provided in all the major holidays, including over the summer. We have committed to spending an extra £200,000 per year throughout the spending review period, and I am pleased to say that all 152 local authorities across England are delivering this programme.
We then have our £24 million national schools breakfast programme, which means thousands of pupils are benefitting from a healthy, nutritious breakfast. There are also 2.2 million key stage 1 pupils provided with a free portion of fruit or vegetables every day. For the youngest in our society, we have the healthy start voucher scheme, which provides a vital safety net for hundreds of thousands of lower-income pregnant women and families with children under the age of four.
I understand that the hon. Lady wants us to go further and extend free school meal eligibility. I will come to some of the points she raised in a moment, but I will start by setting out what we have already done in this area. Under this Government, eligibility for free school meals has been extended several times and to more groups of children than under any other Government over the past half a century. That includes the introduction of universal infant free school meals and the further education entitlement.
I will give way in a moment. I want to mention a piece of work in which I have been specifically involved, both in my previous role at the Department for Work and Pensions and in my current role: permanently extending eligibility to children from families with no recourse to public funds, which is hugely important but subject to income thresholds. That came into effect at Easter.
The Minister is being generous in giving way. Does he not accept that eligibility has had to be extended repeatedly because there are more and more children in poverty? When are this Government going to get to grips with the root causes of the endemic poverty that children in this country are suffering from?
I hear what the hon. Lady says. I have always said to her that I continue to keep eligibility under review for the reasons she has mentioned. We could have a separate debate on the root causes of poverty, and I could talk about the work undertaken in my previous role by the Department for Work and Pensions over the past two and a half years to support people and empower them into work, but that is a debate for another day.
I shall focus on free school meals in particular, although I will touch on universal credit because the protections in place as we roll it out are important. All children eligible for a free school meal at the point at which the threshold was introduced and all those who become eligible as universal credit is rolled out will continue to receive free school meals, even if their household circumstances change dramatically. For example, if those circumstances improve and move them above the earnings threshold, they will not lose that eligibility, which they otherwise would. Even after protections end, if they are still in school, those children will continue to be protected until the end of their phase of education, whether primary or secondary.
Let me turn specifically to the points that the hon. Member for South Shields made about the universal credit threshold. Free school meal eligibility has long been governed by an earnings threshold. That was the same under the legacy benefits system under the previous Government. In April 2018, we updated our eligibility criteria to include the earnings threshold of £7,400 for families on universal credit. That was forecast at the time to increase the number of eligible pupils when compared with the legacy benefits system. That was a direct comparison, and it was designed to increase the number.
It is absolutely right that our provision is aimed at supporting the most disadvantaged—those out of work or on the lowest incomes. The current household earnings threshold is a bit misleading: we put it at £7,400, but that does not include benefit receipt, which means that total household income could be considerably higher than that while someone is receiving a free meal.
Where are we now in society? Come September or October, we will see further rises in the cost of heating a home. We have seen exponential price rises, as prices have moved massively and become totally unaffordable. Is it not time for the Minister to acknowledge that so many people who are above the threshold for universal credit are struggling, and to look to other nations in Europe that have implemented universal free school meals for data on the advancement of and the benefits to those societies, both economic and educational? I name Norway and Portugal.
I hear what the hon. Gentleman says, and I will continue to look at European and other comparators, and at eligibility.
In relation to what the hon. Gentleman—and, indeed, the hon. Member for South Shields—proposes as an in-work and out-of-work benefit, it is important to reference the fact of those on universal credit having that £7,400 earnings threshold. There will be people whose income exceeds £40,000 a year. I know there are people struggling across the country, even on what many would consider a reasonable income, because there is an inflationary shock for many people, and they have outgoings that reflect their earnings.
I will come to that, but while it is right that those families continue to receive a small amount of universal credit, which tapers as their earnings increase, not least to encourage and incentivise work, we have to recognise more broadly—notwithstanding the current inflationary pressures and cost of living pressures—that these are not the most disadvantaged households, which we want to target, or arguably should target, with support in this specific way.
That does not mean we should not be helping those people with specific, targeted support in other ways, which I will come to, but extending free school meal eligibility to all families on universal credit would, without question, carry a significant financial cost—one that I think would be much higher than that which the hon. Member for South Shields has referenced, although we can discuss that another day. It would quickly run into billions of pounds over a spending review and result in around half of all pupils becoming eligible for a free meal, which would have substantial knock-on effects for the affordability of linked provision—for example, the pupil premium, which is linked to eligibility for free school meals.
Having said all that, I understand and appreciate—I have a constituency myself and I speak with people every weekend—that many families are finding it tough, given the global inflationary pressures that affect the cost of living. The question is whether a permanent change to the eligibility criteria for free school meals is the right thing to do now—whether it is affordable and sufficiently targeted, and whether it could be delivered quickly enough if we wanted to operationalise it. My answer to all those points at the moment is no. As I say, the Government understand the pressures people face with the cost of living. These are global challenges, and that is why the Government are providing over £15 billion of further support, targeted particularly at those with the greatest need. We should not forget that this package is in addition to the over £22 billion that was announced previously, with Government support for the cost of living over the course of this year totalling over £37 billion.
Of course, I agree. I do not want to see any child in this country going hungry or a single family in poverty. The hon. Gentleman raised support for councils in his intervention on the hon. Member for South Shields, and that is important. I referenced the £37 billion. I am biased because I originally set up the covid winter grant scheme, which has turned into the household support fund, and I am proud of the support it has provided to councils. That £37 billion includes an additional £500 million to help households with food and essential items. That is on top of what we have already provided since October 2021, and brings total funding for the household support fund to £1.5 billion. We did so because I genuinely believe that local authorities know their communities and those who are in need best and how to target them. There is another £421 million of additional support, which will run until March next year, with the devolved Administrations receiving an extra £79 million.
Let me turn to funding, which the hon. Lady also raised. In order to deliver the free school meal provision, we have increased the core funding for schools with the FSM factor—that is a bit of a mouthful—in the national funding formula. It has increased to £470 per eligible pupil this year to recognise rising inflation and the associated cost pressures, and from speaking with the sector and knowing the challenge that schools face. That was after the NFF rates were set, and we provided core funding through a schools supplementary grant. As a result, core mainstream schools funding will increase by £2.5 billion in 2022-23 compared with last year.
As I say, we already spend around £600 million on universal infant free school meals each year. The per meal rate, which I referenced earlier, was increased to £2.41, because I recognised that that needed to be done, and importantly I backdated that to 1 April this year, which represents an extra £18 million, in recognition of recent cost pressures.
The Minister is doing as I expected and listing some of the things the Government have done, but what about the 800,000 children who are missing out? There will be more of them as the year continues. What support is there for them? Clearly, the support at the moment is not enough because they are still going to foodbanks, so what will he do for those children?
Of course, I work with colleagues and counterparts across Government to ensure that we are supporting people as much as we possibly can, and it is vital that that support is targeted. I referenced the £37 billion. Much of that is yet to come, such as the grants specifically for families and support via the household support fund. One thing I would say, having worked with the Chancellor of the Exchequer when he was Education Secretary, as well as with the previous Chancellor, is that they take an evidence-based approach, and if there is need out there, the Government will step up. I found that to be the case at the Department for Work and Pensions throughout the course of the pandemic. The Chancellor consistently stepped up to support the poorest and the most disadvantaged and vulnerable in our country, and I have no doubt that the Chancellor and the Prime Minister will continue to do so.
As I said, this is a hugely important issue, and I know how it affects some of the most disadvantaged children across our country. I thank the hon. Lady for raising it. It is important that the Government continue to be push to see how much further and faster we can go on these issues. Of course, as I said, I will keep all free school meal eligibility under review to ensure that these meals support those who need them most. As I have said, extending eligibility would be extremely costly, especially if the link between free school meals and other funding is included, such as the pupil premium. A threshold has to be set somewhere, and the current funding is targeted at those who need it most.
Question put and agreed to.
Cost of Living: Support for Farmers
[Mr Philip Hollobone in the Chair]
I beg to move,
That this House has considered support for farmers with the cost of living.
It is a privilege to serve under your chairmanship, Mr Hollobone. I wish to quickly put on record my declaration of interests: I am chair of the all-party parliamentary group on dairy, co-chair of the APPG on farming, and chair of the APPG on geographically protected foods. On that note, I shall move on to the actual business.
The importance of food is finally returning to the national conversation. From food security and supply chain costs, to questions of quality, sustainability and the locality of our produce, our country’s relationship with food is a topic that breaches all divides and impacts on us all. During the pandemic, we all recognised the importance of buying local, and it was wonderful to see people going to the farmer’s gate and talking about how proud they were to support local producers. Fewer have been doing that of late, however, as people have returned to mass marketplaces.
In the recent debate on food and the cost of living, there is one constituency that has been consistently overlooked in our discussions about how to support our constituents through the cost of living crisis. It is our farmers who are most underappreciated and underdiscussed. They are the agricultural backbone of our nation, and they are under a tremendous amount of pressure. Rapid inflation in the sector is driving up the price of everything—from fuel and fertiliser, to machinery and labour costs. The crisis has coincided—and not by the Government’s doing—with the agriculture transition plan of the Department for Environment, Food and Rural Affairs, under which the old support payments to farmers under the common agriculture policy are being reduced.
Although the Government are in the process of rolling out new support measures, the schemes are not ready for farmers to fully access them. The National Farmers Union, the National Audit Office, the Public Accounts Committee and the Institute for Government have all expressed serious concerns about the shortfall in support that is currently in place. The risks of the pressure being experienced—which, sadly, looks like it will become more and more sustained, and more and more heinous—are difficult to overstate. A recent NFU survey has demonstrated that 33% of arable farmers are planning to reduce their cropping next season; that 7% of dairy farmers plan to leave the industry altogether; and that 15% of pig producers have done so in the past six months alone.
The decline in agricultural output will spell disaster for the UK if we are not careful. It will result in food costs rising and our dependency on imports increasing, which is something that our constituents will notice. All of this will happen at a time when supply chains are buckling. Farms such as L&J Stanley in Harby, in my constituency, rightly point out that we should be making a greater effort to increase the amount of food that we grow in the UK. There are real ways in which the Government can step up and support farmers through this difficult period. As several of my colleagues compete for the privilege of serving as Prime Minister, I say to each of them—because I am certain that they are watching this debate—that a Conservative Government are a Government who support British agriculture, and that rurality and supporting our food makers and those who allow us to feed our families should be at the heart of our future policies for the economy.
On labour shortages, we all know the challenges that farmers are facing are severe, and our response therefore has to be significant. The public are acutely aware of the crisis in farming. We have all seen the photos of unpicked crops wilting in the sun, heard the stories of healthy livestock being unnecessarily culled due to a lack of abattoir workers, and felt the impact on our wallets of increased prices in shops and supermarkets. Constituents are particularly concerned when they see security markers and buttons put on products such as Lurpak, and people are unable to afford prices of £8 or £9 just to buy some butter.
A recent survey conducted by dairy giant Arla Foods, which operates in Melton Mowbray in my constituency, found that 80% of farmers looking for workers have received very few or zero applications from people with the right experience or qualifications. Looking back to my education at school and the quiz that pupils did to find out what job or profession they should do when they got older, I do not remember a single person being told they should be a farmer. Are our educationalists pushing people? In my neighbouring areas of Stanford, Peterborough, Corby, Nottingham, Leicester and so on—I have 13 neighbours; is a very busy neighbourhood—people would say that farming is not brought up as a legitimate career, even though the 460 square miles next door in Rutland and Melton offer amazing agricultural jobs. We have to start at the very base—looking at how we get people into the industry—because worker shortages are hammering farmers.
In the dairy sector, milk volumes are down by about 3%, compared with last year, and according to Arla’s survey a scarily high 11.9% of dairy farmers are considering leaving farming altogether if the situation does not improve. In the first instance, we urgently need to address labour shortages across the industry so that we can keep supply chains running and shops stocked. Contrary to certain popular perceptions, agriculture is a highly innovative and technological sector, but many of those innovations are in their infancy, and they cannot currently address a shortfall in labour. They definitely cannot do it when it is acute, quick and coming at farmers at great speed, in addition to the increased costs all around them.
We have to ensure that open positions are added to the Government’s shortage occupation list, to broaden the labour pool and help farmers keep their operations running. I also urge the Government to expand the seasonal agricultural workers scheme to satisfy the demand for labour, and ensure those seasonal visas cover work that needs to be done in the winter too, including the production of Stilton in my constituency—Stilton was invented in Little Dalby, and Long Clawson has amazing creators such as Tuxford & Tebbutt. Those businesses need workers between October and December, which is often not when the Government and civil servants think of providing additional visas.
The next issue is rising costs. We are all struggling with inflation, but the NFU estimates that agricultural inflation stands at over 25%. The Government’s agricultural price index shows that in the 12 months to April 2022, the price index for agricultural inputs increased by 28.4%.
I have spent the past few weeks speaking to farmers in my constituency ahead of this debate. One farmer, who represents I.W. Renner & Sons, which is one of our great farms in Normanton, told me that his main concern is the impact that inflation is having on the cost of fertiliser. Heavily linked to gas, fertiliser is an essential input related to crop yields, and rapid price increases have had a severe impact on output. Ammonium nitrate, a key component of fertiliser, cost £200 per tonne in January 2021, but now costs £900 per tonne if you are lucky. That quadrupling of costs is pushing farms to the brink, reducing product yields and quality and forcing them to transfer some of the costs on to consumers. Additionally, the recent closure of the CF Fertilisers Ince production site, which was once responsible for roughly 50% of domestic fertiliser production, has exacerbated the problem. The Government’s decision not to treat the facility as strategically important will have serious consequences for farming.
The significant increase in costs and the reduced availability of fertiliser will also likely reduce crop yields in UK farms in the coming years, much to our detriment. Many of my farmers are deciding not to grow any more bread wheat, and are changing to growing other types that require less fertiliser and are of lower quality.
The Government can make a real difference. Farmers in Rutland, Melton, the Vale and Harborough villages want us to boost domestic fertiliser production and secure domestic supplies as a priority. I also want to see us open our export markets to places such as Jordan and Canada, to broaden our farmers’ opportunities and move away from taking fertiliser from eastern Europe, which we know will continue to be a volatile market for a long time.
Finally, farmers ask that we increase transparency in the fertiliser market by establishing a gas-fertiliser index. Although we must accept that the Government cannot control the price of fertiliser, fertiliser markets are far too opaque. They threaten business confidence and farmers’ ability to invest for the long term. We all know that our farmers ask for as much resilience, certainty and stability as possible. The establishment of a trusted gas-fertiliser index within DEFRA, with relative global benchmark prices accounted for, would go a long way to help farmers prepare for market volatility. Given that such indices exist in the grain, dairy and meat markets, it is not unreasonable for farmers to expect greater transparency for fertiliser.
The next area of work is flexible support. As I said, the challenges facing farmers are being exacerbated by the fact that DEFRA is currently transitioning to alternative programmes of support, which most hon. Members fully support, but that is leaving funding shortfalls and hampering business confidence. Farmers are resorting to using all available support to tackle inflation and fund operational inputs, rather than look at structural investment. Jan from Northfield Farm in Whissendine in Rutland wrote to me about this, and she captured the essence of what farmers want to see from the Government:
“The support farmers most need is not some sort of handout, it is a programme that helps us to underpin our business across a wide range of areas.”
We can all agree that if we keep applying sticking-plaster solutions, our farmers will struggle to innovate, to compete and to continue to provide the vital products that we all take for granted. I ask the Government to look into introducing farm business loans to provide farms with the capital they need to break the inflationary cycle.
Key to the success of such a scheme would be repayment flexibility—for example, weighting repayments to a period of good return. DEFRA must be more sensitive to the economic cycle of farming, which I know the Minister understands full well, in order to make the most out of support measures. There exists ample opportunity for creating viable investment into modem and productive farming infrastructure.
It is clear that British farming is in a state of flux, and international and domestic pressures are significantly impacting on the sector. While some of the causes are far beyond the Government’s control, we need to tackle those challenges head on; otherwise, we will see an even more significant contraction in production over the next few years. For several of the issues I have raised today, there are concrete steps the Government can and should take to support our farmers.
When I talk to my farmers, it is clear that they are united—whether they represent the most remote Harborough village, are up in the Vale providing milk, or down on pig farms producing livestock down in Rutland. We have to assist with labour schemes, introduce a gas-fertiliser index and create flexible loans to boost investment. Those are the key asks from my farmers. I believe, as I know the Minister does strongly, that our farmers have stood by us over what have been a very difficult past two and a half years. They have kept high-quality, good, nutritious food on our tables. They have fought off vegan militias invading their lands.
I urge the Minister to look at my amendment to the Public Order Bill. I know that it is not in her brief, but it recognised that farms, food production sites and abattoirs should be considered sites of national infrastructure. That would prevent those vegan militias from breaking on to their sites, setting loose livestock, and abusing, intimidating and attacking my farmers. We have seen a big increase in that. Over the summer, shamefully, activist groups are planning to disrupt national dairy supplies across the entire country. These are organised groups, with over 500 people planning to do that.
Our farmers have fed us, protected us and kept our green and pleasant land exactly that. They have stood up against those vegan militias and have continued to look after us despite an enormously challenging two and a half years. Now that they are in a grave situation that is not of their making, I ask the Government to stand by them as they have stood by us.
The debate can last until 4 pm. I am obliged to call the Front Benchers no later than 3.27 pm. The guideline limits are 10 minutes for the SNP spokesperson, 10 minutes for Her Majesty’s Opposition and 10 minutes for the Minister. Alicia Kearns will then have three minutes to sum up the debate. Six Members are standing. We are in Back-Bench time until 3.27 pm, so with a seven-minute limit, everybody will be able to have their say.
It is a pleasure to serve under your chairmanship, Mr Hollobone. I thank the hon. Member for Rutland and Melton (Alicia Kearns) for securing this important debate, and for her incredibly useful opening remarks.
A few weeks ago, I met a number of farmers and farming representatives in my constituency of North Shropshire, at a lovey farm near Whitchurch. Despite the warm welcome and a tour of the state-of-the-art calf shed, the subject matter of the meeting was very sobering. Living in a rural area, often off-grid, in older and less energy-efficient houses, and with little access to public transport means that farmers and their neighbours are experiencing the cost of living crisis to a significant degree. However, for our farmers, it is not just a cost of living crisis—it is a cost of doing business crisis.
Farmers have told me, and we have heard colleagues raise the issue a number of times in the House, that rocketing input costs are putting them at risk of going out of business. Even where increased selling prices are helping to offset that, the cash-flow impact of increased input prices, months before crops are harvested or animals sold, will be enough to put some of our critical food producers out of business. We are all aware of the scale of those input cost prices: the cost of fertiliser has increased more than fourfold; diesel prices have nearly doubled; and the price of animal feed and energy costs are all increasing. Agriflation is hitting the sector really hard.
Those price increases are compounded by other challenges, as the hon. Member for Rutland and Melton has mentioned, such as the shortage of labour for tasks such as harvesting and milking. Pig farmers face an especially tough period, with labour shortages at meat processing plants leaving pigs on farm, and they still need feeding and caring for. I have met pig farmers in North Shropshire whose only option now is to shoot pigs that cannot be processed on farm and think about shutting up shop.
The nail in the coffin for many farmers is the manner in which the basic farm payment has been phased out before its replacement—the agricultural transition plan—is ready to roll. The biggest farms are seeing 40% cuts in their payments, and smaller family farms are seeing cuts that mark the difference between staying in business and going bust altogether. Although the new support schemes are a good idea in principle and I support them, farmers in North Shropshire report that they are not ready to be implemented, require too much up-front investment and will not make up the shortfall in the time required. The National Farmers Union, the National Audit Office and the Public Accounts Committee have all agreed with that bleak assessment.
In the spirit of being constructive, I have some suggestions. As an accountant, I back the call of the NFU to introduce farm business loans to support the cash flow of agricultural businesses through that critical period between input, cost and harvest, as well as its suggestion to improve the transparency of fertiliser market prices and enable greater certainty over the price of fertiliser for next year’s crop.
I also ask the Minister for some additional support for our farmers. At a time when food security can no longer be taken for granted, the Government’s broken promise to maintain the historical levels of support for the transition period is putting the farming sector at high risk. Local farmers have been clear with me that while they support the idea of a payment system that encourages more sustainability in farming, they will not be in business to use it and exploit it after years of falling income and high levels of up-front investment. They have also expressed concern that some of the larger types of regeneration scheme proposed will discourage food production, rather than find a way to improve production on a sustainable basis.
We need an effective strategy to deal with the labour shortages affecting the ability not only to harvest but to process that food once it has been reared and sent off to processing. Farmers need confidence for the future, not just to plant next year’s crop but to invest for greater productivity. I would like the Minister to commit that trade deals done by this Government will not undercut our family farms by allowing cheaper, lower-quality food into the country. We should be proud of our higher animal welfare and environmental standards and lead the world by insisting on a level playing field when we agree to trade with our competitors.
I would like to reflect for a moment on the impact on the people whose businesses are affected by this crisis. They already suffer high levels of isolation and poor levels of mental health, and the situation is worsened by the cruel financial pressure they find themselves under. Visiting a farm close to me on Open Farm Sunday, I met representatives from Shropshire Rural Support, a charity providing a vital component of support for farmers and agricultural workers who need additional help with their mental health. They have reported a noticeable increase in people turning to them for help as the business climate has worsened.
It is vital that we remember the human cost as well as the financial one for those working hard to keep Britain fed. The challenges facing the farming industry are significant and are global in nature—we recognise that. But the Government can take steps to mitigate their impact. I look forward to the Minister’s response.
It is a pleasure to serve under your chairmanship, Mr Hollobone. I thank my hon. Friend the Member for Rutland and Melton (Alicia Kearns) for securing this important debate.
Devon is home to 8% of agricultural holdings in England—a full 514,000 hectares, of which 92,000 are in my constituency, which boasts 1,442 agricultural holdings. Our Devon farms are relatively small, with an average size of just 60 hectares, compared with an English average of 85, and that magnifies some of the challenges that they currently face. My local NFU details that, as small businesses and consumers, farmers are grappling with spiralling costs in both their businesses and households. Agricultural inflation is running higher than consumer inflation. DEFRA figures show that it is at 28.4% for all inputs in the 12 months to April 2022.
In north Devon, most farm businesses involve livestock of some sort or another. The welfare of those livestock is always a primary concern. Farmers are grappling with how to afford feed and bedding for the coming winter. Nearly all farmhouses are off the gas grid and rely on heating oil in the main, which has had massive spikes and is not protected by the price cap of the electricity market. Some farmhouses are listed buildings, so it is difficult to make them energy efficient. Farmers, like others in rural areas, rely on motor vehicles to get to shops, schools and other facilities. The massive increase in fuel costs has a higher impact on those who live in rural areas.
Although I do not think that the solution is to increase rural fuel duty relief—a very specific tax relief that applies only to Lynton and Lynmouth in my rural constituency, as it relates to the distance from the refinery —we need to look for affordable and green solutions to tackle our reliance on the fossil-fuel powered vehicles in more rural parts of the country. It is not right that one set of consumers should pay less for their fuel, as it distorts the market and results in people driving to fill up more than they need to. We need to ensure that the existing fuel duty cut reaches the pump—the Competition and Markets Authority is already investigating the matter—because doing nothing is not a solution.
I would prefer a further fuel duty cut, but until we are confident that it will reach consumers, we must recognise that it may not deliver what we wish. We urgently need better charging infrastructure to enable more of us to switch to electric vehicles, and to look at other creative ways of reducing the cost of transport. In my North Devon constituency, buses are few and far between, and are clearly of no help at all for the transport of livestock or crops.
I recognise that half the basic farm payment has been brought forward, but farmers need more. It is just a matter of cashflow management. For farmers, the uncertainty brought about by much change—new schemes coming onstream, no security of revenue streams, and such surging costs—makes leaving fields fallow preferable. At a time of food insecurity, we need to ensure that every piece of fertile land is used for sustainable food production. That is why I am so exasperated to find that a major national landowner has evicted an organic dairy farmer in my constituency to rewild the land. I know that we need biodiversity, and I support it, but it should not come at the expense of food production. We need sustainable farming, and I urge the Minister to fix rapidly those unintended consequences of DEFRA policy to prevent further evictions and ensure that our productive and fertile land is used appropriately.
I thank my hon. Friend for her point about protecting good-quality agricultural land to feed our nation. It is absolutely wrong that we have so many solar national infrastructure projects going through the Government, but no national oversight of where they are all happening. Masses of our land will end up covered in solar plants, reducing our agricultural capabilities, not least in Rutland, England’s smallest county, where there is a proposal to cover good-quality agricultural land with a 2,100-acre solar plant—it will be built with Uyghur blood and slave labour, although that is another debate. Does she agree that there should be a national strategy on solar plants?
I agree entirely. We need to work out how our land is used. We must tackle not only solar plants, but the issue of growing fuel where we could grow crops. We need to rebalance our land use to ensure that things are actually going in the right direction. I hope that we prevent further evictions.
I welcome the new support and investment schemes for our farmers—as do they—but many of the schemes are far too complex. The Minister has already met my local enterprise partnership and the NFU, which are seeking help to set up an advisory body to ensure that farmers do not have to write to their MPs to try to weave their way through DEFRA bureaucracy. I hope that the Minister will take this opportunity to help to secure the small amount of funding—just £250,000—that Devon farmers are asking for to test having an advisory board to help them through the transition from the old payments schemes to the new. We are dealing with so many small businesses, and that little leg up would enable them to achieve what they are driving for, and what we want them to achieve.
Can we also slow the pace of change between the new and old systems in recognition of the unique role that our farmers play at this time of dramatically increased energy prices, alongside growing concerns about global food security? We know that, in the main, energy prices are being driven upwards by Putin’s vile invasion of Ukraine, and we all support the investment into the war effort of our brave Ukrainian friends, but withdrawing one payment before its replacement arrives is counterproductive.
As I said in my maiden speech, farmers are the custodians of the countryside, and we need to look after them at this difficult time. Some farm-gate prices have jumped, but costs have also escalated beyond all recognition. We can all do our bit and support our farmers by buying British, which is high quality and locally sourced. We have dug for victory before. We need to look to do the same again and support our fabulous farmers to ensure they can do what they want to do—farm sustainably and improve our food security.
It is a pleasure to see you in the Chair, Mr Hollobone. I thank the hon. Member for Rutland and Melton (Alicia Kearns) for her excellent introduction and for raising a comprehensive range of issues. I will focus on just one of the issues she mentioned, which is fertiliser production, as I have a significant constituency interest in the matter.
As we know, fertiliser is critical to food production. An increase in its cost has an impact on yields. We are in a cost of living crisis and I am afraid that this could make matters significantly worse. We should want to encourage as much UK-based fertiliser production as possible. Indeed, maximising self-sufficiency is one of the aims of the food strategy. If the past few months have shown us anything, it is that the risk associated with food security leaves us exposed to global shocks. We are hearing how the recent increase in energy costs, as well as the increase in fertiliser costs, has had an impact on our farmers, but I am sorry to say that that could be just a taster of the trouble we will face if action is not taken now.
I want to make it crystal clear that I am extremely worried that we may be sleepwalking into a desperate situation of too much pressure on fertiliser costs and consequentially on food prices, because of the situation at CF Fertilisers in my constituency. As the Minister knows, CF Fertilisers is a longstanding plant in Ince, near Ellesmere Port, which employs over 300 people and has been a historical and significant source of fertiliser for the UK agricultural community. Last month, its American owners announced their intention to close the plant and begin consultation on the consequent redundancies with the trade union.
I am grateful to the Minister for her offer to have further discussions on the matter and to the Secretary of State, who met with me last month to discuss the situation. At that point, there was still some hope that a commercial solution could be found. After all, the site has been profitable for many years and has a highly skilled and committed workforce, which we want to retain in those valuable jobs. Unfortunately, various newspaper reports over the past few days have indicated that a sale agreement is unlikely to go ahead. That is extremely worrying. The concern I have, which has been conveyed to me by a significant number of the workforce, is that it is not in the parent company’s interest to sell the site as an ongoing concern.
If the site closes, CF will have no domestic competition for fertiliser sales. It plans to retain its site in Billingham in the north-east—for now, at least—but like every other site, that site can be closed at short notice for technical reasons or, as we saw last year, financial ones. It also requires shutdowns for several months at a time every three years or so. Given what we know, it is not a prudent strategy for the nation to put all its eggs in one basket, particularly when that basket is owned by an overseas company that has shown it is ruthlessly guided by the bottom line.
The fear articulated to me by many people is that CF do not want to sell the site to a potential competitor. It would rather see the machinery and plant equipment sold for scrap than lose its monopoly position in the UK market. Look at its financial performance: it makes an awful lot of money. Its earnings before interest, taxes, depreciation and amortisation in the first quarter alone was $1.68 billion. It increased its dividend by 33% in the first quarter of the year. CF could give the site away for nothing and it would not materially affect its bottom line, but it does not want to do that because it would deny them the opportunity of seizing every last penny from UK farmers. How is it in the national interest to let that happen? How is it sensible to allow a situation in which we know this course of action will put even more pressure on food prices? How is it levelling up to allow 300 highly paid, well-skilled jobs in the north-west go, when we know that there is a viable business there? If there is a way forward, it should be allowed to continue.
I cannot overstate to the Minister just how concerned local people are about the parent company’s true intentions. It is clear from talking to them just how little trust they have in CF now and how they believe the consultation process to be, frankly, a sham. The process ends in just a few weeks and, unless there is a dramatic change of approach, we will lose all those jobs and be in a hugely exposed food-security position in future. This cannot wait for a new Prime Minister. I urge the Government to intervene and for members of the Cabinet, for a minute, to stop jostling about their own jobs and to think about my constituents’ jobs, because those will be gone in a few weeks, with knock-on effects on jobs in the agricultural sector generally.
Please, will the Minister do everything in her power to keep the plant open? I want to be clear: if it is allowed to close, the ramifications of that decision could be felt for years to come. People will rightly ask, “What did the Government do to stop it?”
I congratulate my hon. Friend the Member for Rutland and Melton (Alicia Kearns) on securing this important debate on farming and our farmers. She made an eloquent speech, but she was far too kind to our Government. I intend to highlight some of my concerns to the Minister.
I very much enjoyed a young farmers’ event in Much Wenlock, which I visited the other day, just on the border between my constituency and that of my right hon. Friend the Member for Ludlow (Philip Dunne). I met so many young Salopian farmers who were at the conference. I saw the energy, dynamism and conviction they all have, and it gave me real hope for the future of farming, bearing in mind how thriving Shropshire young farmers are and the tremendous work they do and continue to do.
I campaigned for Brexit to ensure that regulations and rules affecting our farmers were made here in Westminster, not in Brussels. As the Minister knows, farming is very different in each of the 27 European Union countries. Clearly, the one-size-fits-all system under the common agricultural policy has failed spectacularly, in particular for our farmers here in the United Kingdom. Now, we are freed from those regulations, so the Minister and the Government are solely responsible for the regulatory and taxation framework affecting our farmers.
The opportunities are vast, but I am not satisfied that the Government are doing enough to support our farmers. I say that from the great deal of feedback that I received from my local Shropshire farmers. More than that, the Government are not turning this industry into one of the most exciting opportunities for young graduates and young people looking for work. In 2002, the Labour party abolished the Ministry of Agriculture—I am not sure why, but perhaps the representatives of the Labour party might explain why—but we now need a new Ministry of Agriculture and Fisheries, and that is why I am speaking in the debate.
I have sent a message to all the candidates standing to be the next leader of the Conservative party to ask whether they will commit to creating a new Ministry of Agriculture and Fisheries, and to a dedicated Secretary of State sitting at the Cabinet table, responsible for farming, responsible and accountable to the NFU and to farmers, and someone who can be challenged here in the House of Commons on all aspects of agriculture.
I pay tribute to the Minister. All my interactions with her have led me to believe that she is not only very efficient, but highly capable and knowledgeable about agriculture. However, she is not a Secretary of State. I would like her to be a Secretary of State—she would make an outstanding Secretary of State. We need that voice for agriculture round the Cabinet table.
We have all the attributes of being one of the most highly efficient and productive agricultural countries in Europe. We have some of the best agricultural institutions in Europe, one of them in Shropshire—the Harper Adams college. We are extremely proud of that extraordinary, world-beating institution in Shropshire. I hope the Minister will agree in her winding-up speech to come before too long to Harper Adams to see the work taking place there. We have the talents of young farmers and arguably some of the best soil conditions in Europe and the best climate conditions to turn this country into an agricultural superpower in Europe, unconstrained by the dead hand of EU bureaucracy. But that is not happening and it needs to change.
I met the other day the new chair of the EFRA Committee, my right hon. Friend the Member for Scarborough and Whitby (Sir Robert Goodwill), and we had a one-hour online call with my association chairman, who is involved in agriculture. I am extremely pleased that the new chair of the EFRA Select Committee has an agriculture degree himself. I wish him every success in holding the Government to account.
Skills and education not only help people get on in life, but help drive forward our agricultural sector and really turbocharge it and make sure that it is fit for the future. Colleges such as Lackham in my constituency are right at the front and centre of that. Will my hon. Friend pay tribute to all land-based colleges across the country?
I will of course join her in paying tribute. We are all seeing her meteoric rise up the ranks of the Conservative parliamentary party, and I will pay tribute as long as she takes the message back to the Cabinet that we need a Secretary of State for agriculture.
My association chairman, Mr David Roberts from Halfway House, runs GO Davies, Shropshire’s largest agricultural feed and seed merchant. He has been bending my ear almost on a daily basis about fertiliser costs and the security of production in the United Kingdom. He is not satisfied by the responses that we have had to date. We have been tabling a lot of written parliamentary questions on the issue. As others have said, ammonium nitrate has gone from £200 per tonne in 2021 to over £900 per tonne today. Fertiliser plants in the United Kingdom have closed and others are vulnerable.
I shall say something now that I have not said before in my 17-year career as a Member of Parliament: we need to nationalise the plants. I never thought that as a Conservative I would call for the nationalisation of anything. I am normally highly opposed to the concept of nationalisation, but I agree with the hon. Member for Ellesmere Port and Neston (Justin Madders). Bearing in mind how extraordinarily important food security is becoming—the consequences of the war in Russia are only just starting to have an impact—and how vulnerable the plants are, I fundamentally believe the Government have a responsibility to take control of the plants, nationalise them and guarantee the future security of fertiliser production in the United Kingdom.
I am running out of time, but, finally, I concur with the sentiments about mental health. We here in the House of Commons benefit from the health and wellbeing team that can help us at times when we suffer mental health problems. We do not have that support across many rural areas, and I am extremely concerned about some of the anecdotal evidence I have heard about mental health problems and increasing suicides in farming. We should celebrate our farmers and our British agriculture, and I look forward to hearing what the Minister says in her wind-up.
It is a real pleasure to serve under your chairmanship, Mr Hollobone. It is also a pleasure to follow the hon. Member for Shrewsbury and Atcham (Daniel Kawczynski). It might surprise him and other Members to hear that I very much agree with many of his remarks, especially his point that farmers in Shropshire, like those in my constituency, have long felt that Governments have not always appreciated the importance of their contribution to the nation’s wellbeing, and the importance of food security. I also associate myself with his comments about the strategic importance of fertiliser plants. He proposed the good idea of greater state intervention in those strategically important sites, and I will touch on that in a moment.
I congratulate the hon. Member for Rutland and Melton (Alicia Kearns) on securing this important debate. She eloquently set out the grave backdrop to it and the many challenges our farmers face. It is sobering to reflect on the fact that so many farmers, facing rising input costs and cost of living challenges, are considering leaving the industry. She said that 11.9% of dairy farmers are contemplating that, and I know anecdotally that a number of livestock farmers in Ceredigion are considering whether they have a future in the industry. It is little wonder, given that agflation, or agricultural inflation, stands at 28.4% according to the agricultural price index. The latest estimates from independent consultants the Andersons Centre have agricultural inflation standing at over 25%.
I spoke to some farmers in Wales recently. Many people say that they have better prices at the market, and that of course is true, but we do not always hear about the rising cost of production, so farmers very much need those higher prices. Although the prices have risen, they have seen little difference in their profit margin, and that is fuelling a great fear of a departure from the industry, which we can ill afford given the many concerns that have rightly been raised in recent months about our food security. The war in Ukraine has brought that into sharp relief. The challenge before us is to increase, not reduce, our agricultural productive capacity.
The hon. Member for North Devon (Selaine Saxby) made several important points, but one that struck a chord with me was about the need for more co-ordinated land use planning to overcome some of the many competing challenges. We need to return to that matter in earnest, because we cannot waste much time.
We have heard about rising fuel prices, and there is room for us to explore expanding the rural fuel duty relief scheme, although I appreciate that that is not within the Minister’s remit. Fertiliser has been mentioned a few times. To add to the remarks of the hon. Member for Shrewsbury and Atcham, I know of farmers who, just this last year, have seen orders for fertiliser increase significantly. They were quoted prices of about £200 per tonne last year, and now it is not uncommon to see prices upwards of £700 per tonne, plus VAT. The inability to plan amid such volatility is a real challenge for our farmers, and puts pressure on their margins. It is often said that farmers find it very difficult to eke out a living even in the best of times, but the added volatility and the price hikes that they have to navigate make it an almost impossible task.
In Wales, the average farm holding is 48 hectares. Anybody who cares to look at farm business incomes in Wales will know that most farms in Wales do not have much discretionary income with which to absorb these additional prices. It is time that we look at interventions to support farmers with rising input prices, particularly the cost of fertiliser.
The hon. Member for Rutland and Melton said that the Government need to establish a gas-fertiliser price index to help improve transparency in a very opaque market. That might not necessarily help to bring down prices, but it would at least offer a bit of a helping hand in planning and managing a bit of the volatility.
With regard to how we help with the costs of fertilisers, in addition to those points made by the hon. Members for Shrewsbury and Atcham and for Ellesmere Port and Neston (Justin Madders) about the strategic importance of fertiliser plants, is it perhaps time for us to consider again the VAT treatment of some of those inputs into agricultural production? I appreciate that that is for the Treasury, but perhaps the Farming Minister could consider having a discussion with Treasury colleagues.
In the short term, many Members representing rural constituencies will know that the price of heating homes is a real concern, especially for those in properties off the mains gas grid, including farmhouses. Under the energy bill support scheme, some £400 is due to come in the autumn, but a question remains as to whether farmhouses will be eligible, primarily due to how they tend to have commercial electricity contracts as opposed to domestic ones. The Department for Business, Energy and Industrial Strategy is looking at options to ensure that farms do not lose out under the scheme, but will the Minister impress on it the importance of us finding a way to include farmhouses in the scheme? Although it might not make the world of difference, every little will help in the coming economic storm, so it is important that we ensure that farmers do not lose out.
I congratulate my hon. Friend the Member for Rutland and Melton (Alicia Kearns) on securing this hugely important debate, which is fundamentally important to the people of Cornwall. I speak as the Member for Truro and Falmouth, an area with a long history of farming and with 82% of its land used for agriculture.
Farming is a vital industry in Cornwall and has helped to shape the landscape that we see today. Almost every type of farming practised across the UK can be found in our Duchy. Our food industry is worth about £2 billion, and one in three jobs in the county—equating to about 60,000 people, and growing—has some attachment to the Cornish food and drink production industry. We have hundreds of fantastic farmers from all backgrounds who are passionate about growing an abundant supply of food, produced to world-leading standards and sustainability. We must enable those farmers to produce food efficiently if they are to continue to play their essential role in the south-west’s rural economy and deliver environmental benefits.
I recently met the National Farmers Union and farmers at Sixty Acres farm in Truro. That was a really positive meeting at which farmers raised many of the issues that we have heard about today. They also voiced their appreciation for what the Government have done to help support them so far.
A couple of weeks ago, I visited Carruan farm in the constituency of my hon. Friend the Member for North Cornwall (Scott Mann). We heard from farmers about how we can meet our net zero and carbon targets, deliver on nature recovery and boost sustainable food production. At the farm, they are successfully trying to do that. They are finding out which of their fields are non-productive and doing more with that. I will come to some of its concerns later on.
As we have heard, the key concern shared by farmers throughout Cornwall is the struggle to absorb rising input costs, which are increasing three times faster than the headline UK inflation rate. As we have heard, agflation topped 30% in April and is currently at about 28.4%. The war in Ukraine has pushed up the already sky-high input costs of the three Fs: fertiliser, fuel and feed. This year, fertiliser trebled in price, and red diesel, as I have heard from my fishermen and farmers, has doubled in price, which is a much larger increase compared with road diesel. In March, concentrate animal feed prices had increased by about 15.6% compared with the previous year. Those price rises come at a time when the industry faces longer-term challenges due to not only the transition away from the basic payment scheme but labour shortages and the impact of new trade and environmental policies. Alongside the variable role of the weather—of course—the decisions that farmers are making feel more like a gamble than ever before.
I thank the Government for listening last winter and extending the seasonal agricultural workers scheme to our daffodil pickers in particular, because there was going to be a disaster in the making. It took a lot of effort—it was not the Minister but the Home Office that we needed to convince—but we were listened to in the end and that saved an awful lot of jobs and gave security to our farmers.
Those challenges are impacting on the food we are producing as a nation, and leading to a crisis of confidence among our farmers. The cost of living crisis will only worsen if our domestic food security is undermined. Although they are larger than they used to be, farm businesses in Cornwall are smaller than the national average, and they are more likely to be livestock-oriented and still family-based. Small livestock farms have higher costs and smaller revenue, and they are more reliant on support payments for now, meaning that BPS reductions have hit hard and early in the transition.
In 2020, Cornwall received £51.6 billion in BPS payments. The reason for highlighting that figure is not to suggest that we are merely swapping this for a smaller-size replacement, but the future of sustainable farming will not be built on the same old subsidy models. I raise this issue so that the Government can think proactively about mitigating the adverse impacts on the farming community and the business ecosystem of the Cornish countryside of simply withdrawing that payment, and I urge the Government to produce on-farm business advice to support the transition. I believe we heard that earlier, and it was one of the main points that come out of our farm visit in North Cornwall a couple of weeks ago.
There seem to be a lot of grants available for farmers—a huge number are out there for them to access—but the time-consuming and complicated nature of the grant application is causing them huge issues. What they are really looking for are people who have local knowledge on the ground in the county and who can help guide them through the cost of living crisis, be it through the local enterprise partnership, the council or DEFRA agents. Farmers really need on-site support, and they also need effective business plans with a clear direction of travel to improve productivity.
The Government have taken a range of actions to tackle the challenges, including delaying the introduction of changes to urea fertiliser for at least a year and the recent launch of the new grant scheme for storing slurry on farms. The Government have also committed to spending £600 million on farm-based innovation over the next three years, and have laid out further details of the sustainable farming incentive. That will reward farmers for promoting the common good and bolstering our food security.
However, farmers are still under real pressure, and the Government have a range of options available for further support. The Government must focus on protecting UK food production and security by assisting farmers and managing the high costs. That includes working with farmers to diversify inputs, and investing in new technologies that will improve their resource and efficiency. We must also support farmers to find new ways to manufacture more organic-based fertiliser products and utilise techniques, including using nitrogen as an alternative fertiliser. The other thing that I learned on the farm visit a couple of weeks ago, and from speaking to other farmers in Cornwall, is that one size does not fit all, even in Cornwall. Somebody three miles down the road will have completely different soil, so what works for them will not work for their neighbour, which is why we need people on the ground who can really help in these situations.
The Government should look at encouraging the uptake of regenerative farming to reduce input costs, encouraging more pasture-fed livestock to reduce feed costs, and supporting new production methods in the forthcoming food strategy White Paper. I also support calls from the NFU for Ministers to assess the impact of any new policy or regulation on domestic food production, which is hugely important at the moment.
Our farming industry is facing very difficult circumstances, with many farmers struggling to pay their bills. That is threatening food security and worsening the cost of living crisis for us all, but they are a resilient bunch. I look forward to continuing to meet our farmers, listening to their concerns and talking to our Government. I will work with the Minister and my neighbours on both sides—the Secretary of State and the new Under-Secretary of State for Environment, Food and Rural Affairs, my hon. Friend the Member for St Austell and Newquay (Steve Double)—to make sure that we back this vital industry going forward.
It is great to see you in your place, Mr Hollobone, and I warmly congratulate the hon. Member for Rutland and Melton (Alicia Kearns) on bringing forward this very important issue. I will never tire of stressing the importance of farming and agriculture to all our lives, never mind to all our constituents and constituencies. It is also important for us to recognise the severity of the crisis that farmers are all facing.
If you ate today, thank a farmer. Farmers are fundamental to our existence as a species, never mind as a society. What they do is integral to how we see our land, how we steward the animals on it, the quality of our water and where people live, and it is vital for vast chunks of the four nations of this Union.
Agriculture will always be close to my heart. I served very proudly on the European Parliament’s Agriculture Committee for the best part of 15 years, designing the current common agricultural policy. I represent the Stirling constituency, which is the size of Luxembourg and has some of the best—and, indeed, some of the worst—farmland in Scotland, and I am proud to work with and for Scotland’s farmers and growers.
In all our countries, agriculture is a hugely sophisticated, science-intensive, innovative business. In Scotland, it employs 67,000 people directly and supports a further 320,000 people, with a gross output of £3.3 billion annually, as well as producing the food we eat, which is quite important.
Of course, agriculture is largely a competence of the Scottish Parliament. We have made several different decisions where necessary, but many of the issues that our farmers face cross borders within this Union, but also on a far wider, global scale. Many of the ideas we need to share are things we need to work on together. We are in a crisis, in Scotland, England, Wales and Northern Ireland. Farming is in crisis right now, and we need to be real about it—we need to be serious.
Many policy levers are reserved to this place. I am talking specifically about trade policy, competition policy, procurement policy—especially in the light of the passing of the United Kingdom Internal Market Act 2020—energy policy in part and, ultimately, budgets as well, given the financial situation of the current devolution settlement.
The Scottish Government are taking this seriously, and we would like to do more. The EU is taking this seriously, creating a £1.5 billion crisis fund to support EU farmers. I am calling on the UK Government to do more and am pledging my support for anything that helps farmers anywhere. Now is the time to put our differences to one side and to focus on where we can make a difference to the people we all serve. That is not to say I am putting them aside forever, because that might be part of the solution from our perspective. I suspect we will come back to that point.
Food security has to be viewed as—from the contributions in the debate I think we agree on this point—if not part of our national security, then certainly as part of our national resilience, however nationalis defined. As we face a summer of increasingly high temperatures and possible drought, we need to be serious about where our food is coming from and how it is produced.
We are all agreed we need to support farmers. The best way to support their incomes is to ensure profitable market return. That is my first point about UK Government policy. Too many farmers find that the market is stacked against them. There are many ways that we could boost demand, including through increasing local, domestic demand. That could be more money for buy local, buy Scottish, buy British schemes. There have been a number of good examples and now is the time to put more resource to that. There should also be more support for quality schemes, such as run by Quality Meat Scotland north of the border, and various farm assurance schemes elsewhere. We are seeing some farmers walking away from those schemes, which is deeply regrettable because consumers want local food produced to high standards.
Procurement policy is one area where I might agree there could be a benefit of Brexit. I have struggled to find many, but this might be one. I can point to parliamentary questions I have asked in Brussels and Strasbourg where the European Commission said, quite explicitly, that carbon emissions could be used as a procurement criteria, boosting local procurement of food, however local is defined. Even within the EU that was possible. Surely, outwith the EU, there is now lots more that could be done through procurement policy to boost local demand for agricultural products, providing a better market for our farmers.
Ensuring a fair market also needs more attention on monopolies and opaque markets. I think particularly of supermarkets and the fertiliser sector. We have a supermarket regulator. That regulator needs far more powers and far more teeth to do what needs to be done.
Market conditions are pressing for farmers. We particularly need action on input costs. There is a need for temporary support and the Scottish Government are looking at various ways of taking that forward. This is an opportunity for the whole of the UK to support farmers. Fuel, fertiliser, labour and feed are all going up at unsustainable levels. Farmers need help now.
On fuel, there is already red diesel support, but we need gas support as well. As we have heard, many farm holdings are off-grid and are becoming increasingly expensive. On fertiliser, there is a clear need for market intervention and support for fertiliser costs. On labour, there is the seasonal workers scheme and we need action on visas to allow more people to help with the work. Many costs have gone up 25% to 45% in recent times. That is absolutely unsustainable for working an agricultural balance sheet. There is a strong case, which I appreciate is outwith the Minister’s remit but I make the suggestion constructively, that we could find ways in which to support those points, including through soft loans and loan guarantees.
Agricultural policy is entirely distinct between Scotland and England, and I am glad that we have made the decisions we have made in Scotland, especially to maintain direct payments. During the current period that is a great safety net for Scottish farmers and I urge the UK Government to revisit that, although that it is a competence outwith my remit.
We also need to see policy coherence over land use. Photovoltaic plants and rewilding have been mentioned, but I would add forestry to that discussion. It is right that we see competing land use purposes, but we must agree that food has to come first. Anything that cuts across food production needs to be deprioritised. I am not hostile to any of the things mentioned, but when I was on the Agriculture Committee of the European Parliament, the intention was to see the bits and parts of unproductive land go to those purpose. Surely it cannot make sense to take prime agricultural land in any of our countries out of production.
We have already had many happy adventures with the Minister about our difference of opinion on trade policy. I am not hostile to trade deals with countries on the other side of the world, but I do not want to see those trade deals undercut domestic food production. Putting that to one side, the closest, biggest market to the UK is the EU, in both directions. Our farmers are struggling with particularly sticky customs routines and the phytosanitary and veterinary checks. I was in Brussels two weeks ago, and it is quite clear that there is a huge appetite for a specific veterinary and phytosanitary agreement with the UK that would help all our farmers to export and import, freeing up production and hopefully lowering prices. That is on the table in Brussels; it needs to be taken forward by a Government that is going to take this, and indeed international law in Northern Ireland, seriously.
It is a pleasure to sum up in this debate. There have been several good suggestions for the Minister to take forward to her colleagues. Where there are sensible suggestions to take forward for the benefit of all our farmers, I will work together with colleagues to make that happen.
It is a pleasure to serve with you in the Chair, Mr Hollobone. I congratulate the hon. Member for Rutland and Melton (Alicia Kearns) on securing the debate. I do not always find myself in agreement with her. She is an eminent plotter, of course, but I certainly found myself in agreement with many of the points she made today.
I noted the comments made by the newly liberated hon. Member for North Devon (Selaine Saxby), who has discovered the horrors of DEFRA bureaucracy made in Britain. It is interesting to see how the last week has panned out, Mr Hollobone. We also had a fleeting appearance from a former Secretary of State for Education, the right hon. Member for Chippenham (Michelle Donelan), which was fascinating.
All the powerful contributions from across the House indicated that these are very tough times for farming, just as they are for the wider environment. We need support for both, not least because on the Government’s watch I am afraid the farming sector has suffered crisis after crisis. Prices may be good at the moment, but just look at input costs—and shudder and be worried. Look at the continuing pig backlog, with tens of thousands of healthy pigs already culled, as we heard from an earlier speaker. Look at avian flu—the worst for many years—which many fear may become a recurring annual issue. At these times, when other nations in the UK and in Europe, have provided the farming sector with much-needed support, this Government have consistently refused to lend a helping hand to English farmers. The basic message is that they are on their own and the market will sort it out. Some of them will go to the wall, but “them’s the breaks.”
The current challenges bearing down on the agricultural sector are the most severe that many farming businesses have ever faced, with inflation, lack of seasonal agricultural labour and a botched roll-out of the environmental land management scheme all putting British agriculture and food security at risk. The Opposition take a different view. Intervention is not alien to us. We back British farmers and have consistently raised concerns that many farms will be unable to cope with soaring inflation.
We have heard many figures. The Government’s own agricultural price index shows that in the 12 months to April 2022, the price index for agricultural inputs increased by over 28% and Andersons’ latest inflation estimate for agriculture is over 25%. We all know the effect of the war in Ukraine and significant gas price rises worldwide. Not only do they put farms at risk; they also threaten Britain’s food security.
The Lea Valley Growers Association has warned that the UK will harvest less than half its normal quantity of sweet peppers and cucumbers this year after many greenhouse growers chose not to plant in the face of surging energy prices, and producers have warned that yields of other indoor crops, such as tomatoes and aubergines, will also be hit. Far from producing more food in the UK, under this Government we risk seeing less being produced.
We had a good discussion about the fertiliser issues. I pay tribute to my hon. Friend the Member for Ellesmere Port and Neston (Justin Madders) for the fight he has been conducting on behalf of his constituents and the wider points that he made. I will not repeat those points, but I ask the Minister to set out, after months of dither and delay from the Government, what steps her Department is taking to help farmers to access affordable energy and fertiliser now. What are the Government doing in response to the powerful points made by my hon. Friend? How do the Government intend to curb agricultural inflation, and does the Minister have any plans to help support domestic fertiliser production?
If farmers were only facing inflation, that would be more than bad enough. However, as we have heard, there is a chronic shortage of seasonal agricultural workers. That is a crisis of the Government’s own making; they initially announced 30,000 horticultural seasonal worker visas, but then that number was upped to 40,000— although 2,000 went to poultry workers. Throughout that debate, the NFU and others estimated that we needed 70,000 workers. Why did the Department’s calculations differ so much from those on the ground and in the industry? I am sure the Minister will remember the woeful performance of the Immigration Minister, the Under-Secretary of State for the Home Department, the hon. Member for Torbay (Kevin Foster), before the Environment, Food and Rural Affairs Committee—Committee members were certainly not convinced.
Survey data from the NFU for April showed an estimated national seasonal worker shortfall of 12% in horticulture—three times the figure for the same month last year. Industry experts say that labour shortages on British farms this summer have led to catastrophic waste of homegrown fruit and vegetables. A survey by British Berry Growers showed that annual food waste almost doubled, from £18.7 million in 2020, to £36.5 million in 2021, due to worker shortages. It could be even higher this year. I ask the Minister what support she will be offering farmers struggling to find seasonal labour, and what plans her Department has to put an end to the shortage.
The latest crises take place against the backdrop of the slow and painfully complicated introduction of the environmental land management scheme. The Government are currently phasing out direct payments and farmers have already received significant cuts to those payments, with further to come this year. The Government always suggested that the payments would be replaced by the environmental land management scheme. While the Opposition support the principle of paying farmers to provide environmental goods, the Minister will remember that I warned during the passage of the Agriculture Act 2020 that farmers would be unwise to imagine it would be a straightforward replacement. That has turned out to be the case.
The NFU, the National Audit Office and the Public Accounts Committee, as well as farmers and Opposition Members, all warned that those new schemes are simply not ready for farmers to access them and start making up the shortfall. Will the Minister confirm how she intends to support farms struggling with the transition? What plans does her Department have to speed up the introduction of the ELM, and the sustainable farming incentive in particular?
Will the Minister confirm the budget allocated to the landscape recovery scheme tier 3, following the extraordinary story briefed to newspapers a few weeks ago that it would be hugely reduced? In The Sunday Times, it was described as being reduced to just £50 million over three years. The paper said that DEFRA insiders believed that the scheme was likely to be scrapped after that. Will the Minister clarify whether that story was put out ahead of the Tiverton and Honiton by-election to buy a few votes, or is it actually Government policy?
Although the Conservatives may be unwilling to support British agriculture, Labour takes a different view. On ELM, we have supported the NFU’s calls for basic payment reductions to be paused for two years to provide more time. Frankly, we think that it will take that time to get it sorted out. We do not want to see more stewardship agreements rolled out so that people get paid for doing what they are doing already. We want genuine environmental gain. We would reprioritise ELM to secure more domestic food production in an environmentally sustainable way as part of our plan to support farmers to reach net zero. That plan is conspicuously lacking in DEFRA.
On seasonal labour, through our five-point plan to make Brexit work, Labour will deliver on the opportunities Britain has, sort out the poor deal signed by the—I was going to say previous, but he is still in place—Prime Minister, and end the Brexit divisions once and for all. We will seek new flexible labour mobility arrangements for those making short-term work trips. On inflation, Labour will support struggling agricultural businesses through our plan to make, buy and sell more in Britain, invest in jobs and skills and use the power of public procurement. There is another away: a fresh start to get us to net zero; a fresh start for our food system; and a fresh start for our farmers. That is what support for farmers looks like.
It is a great pleasure to serve under your chairmanship, Mr Hollobone, as it has been to listen to the constructive suggestions across the House on how to deal with the very real difficulties in the sector, largely caused by high rises in input costs. I will start by addressing the various issues that colleagues mentioned, and will do my best to answer the very wide-ranging group of issues raised as comprehensively as I can.
I thank my hon. Friend the Member for Rutland and Melton (Alicia Kearns) for securing the debate. I also thank our former DEFRA Parliamentary Private Secretary, my hon. Friend the Member for North Devon (Selaine Saxby), who served the Department with great distinction and a great deal of hard work. She is a real champion for Devon farmers. I have heard her and have met her farmers with her on many occasions as they tell her what they need. I reassure her that the advisory board conversation will continue in the next few weeks.
My hon. Friend the Member for Truro and Falmouth (Cherilyn Mackrory) made a comprehensive speech. Again, she frequently buttonholes me on behalf of her farmers and her fishermen. The future farming resilience fund is available to give exactly the sort of advice that she envisages. I would love to talk to her about that outside the debate, if that would be helpful to her.
I have frequently discussed farming issues with my hon. Friend the Member for Shrewsbury and Atcham (Daniel Kawczynski) and the farmers he represents so well. I agree that the opportunities for the future of agriculture are vast. Let me put on record how pleased I am that we passed, with agreement broadly across the House, Committee stage of the Genetic Technology (Precision Breeding) Bill last week. In a week that was perhaps difficult for the Government, that was a high point and is exactly what my hon. Friend means when he says that there are real opportunities for the future of agriculture if we are able to grasp the regulatory space. I would be delighted to visit Harper Adams, although my hon. Friend the Member for Bury St Edmunds (Jo Churchill), who so recently and sadly departed from the Department, visited extremely recently and came away full of ideas.
I was interested to hear what the hon. Member for Ellesmere Port and Neston (Justin Madders) said. He and I have spoken, as he has with my Secretary of State, about the difficult issues facing Ince. My understanding is that discussions, which are commercially sensitive, are still under way. I would welcome the opportunity to talk to the hon. Gentleman directly about the current situation. I am also very happy to make his points across Government if he feels that would be helpful. The situation with Ince is worrying for all of us who care about fertiliser prices, although I recognise that it is particularly difficult for those whose jobs are at risk.
These are not easy times for our farmers, who face increasing costs, particularly for fertiliser, animal feed, fuel and energy. Undoubtedly, that is creating short-term cash flow pressures. The Government have announced a series of measures to help farmers with those pressures and to support them through an undoubtedly difficult time. From the end of July, we are bringing forward half this year’s basic payment scheme payment as an advanced injection of cash to farm businesses. That is a practical and appropriate solution to current input problems. Payments will be made in two instalments each year for the remainder of the agricultural transition period. I am very pleased with that policy decision.
I am fully aware of the cost of fertiliser. The current cost is a little lower than my hon. Friend the Member for Rutland and Melton suggested—it is between £700 and £750 a tonne, although I accept that that is considerably more than usual. As a purchaser of fertiliser, I am always extremely aware of that market, as are most farmers. Although cereals farmers, such as me, often buy ahead and will be able to manage for this year at least, livestock farmers often buy much later in the season, and we need them to have the confidence to make purchasing decisions and put in orders so that we are assured that enough fodder crops will be grown in the next 12 months.
I have worked extremely closely with farmers’ representatives—the NFU, the Country Land and Business Association, and the tenants—to build confidence through cross-Government and industry working, and by ensuring that the Government pull all the levers we can to make the situation better, short, frankly, of writing the cheque for everybody’s fertiliser bill. We have issued updated guidance to provide clarity to farmers about how they can use slurry and other manures during autumn and winter. We have delayed the changes to the use of urea fertiliser, and we have introduced new slurry storage grants to help farmers to comply with the farming rules for water. The aim of all that, of course, is to reduce the dependency on artificial fertiliser.
My hon. Friend asked about the potential to increase transparency in the fertiliser market through the NFU suggestion of a gas fertiliser index. We are currently working with the Agriculture and Horticulture Development Board, the Agricultural Industries Confederation and the NFU on how best to achieve fertiliser price transparency. My hon. Friend should please keep talking to me about how that can be best achieved. Some sensible suggestions were made today, not least by the hon. Member for Ceredigion (Ben Lake), but there is a bit more work to be done. We need to continue to work on this policy area to get it absolutely right. The fertiliser taskforce, which I chair with my hon. Friend the Member for Bury St Edmunds, is very much continuing, and I believe we have a meeting next week. This is ongoing work. It is not easy, but we are doing our best to be flexible and react where we can.
We recognise that feed is a particular issue for the pig and poultry sectors. As of 1 June, we successfully concluded the removal of section 232 tariffs, allowing us to remove the 25% tariff on US maize imports. That was a key industry ask and should be an important step in opening alternative sourcing options. Again, we remain very open to working with the industry on specific asks.
We are the only sector with a carve-out for seasonal labour, and I think that is absolutely right. I am convinced that seasonal worker visas are a critical part of how we bring the harvest home. I am happy to continue to make the case for them across Government. We have achieved an extra 10,000 visas through the seasonal agricultural worker scheme route, so we have 40,000 visas for this summer and winter, which are critical to maintaining the agricultural labour provision.
Through the Agriculture Act, we have taken powers to look at supply chain fairness in more detail. We started by dealing with the dairy sector, and we plan to take regulatory action in it as a result of our work later this year. It is complex and we need to get it right. We are about to launch a review of the pig sector supply chain. I look forward to announcing that formally shortly and to giving more details of the consultation process.
My hon. Friend the Member for Rutland and Melton asked about farm business loans to support farmers with rising costs. My officials in the Department regularly meet the agricultural leads of major banks, and I have done so on several occasions. I have also had a special meeting with agricultural leads about the pig sector. In the most recent meeting, on 7 July, the banks suggested that the level of debt among UK farmers is low in comparison with other European countries, and that they are very willing to view farmers as a good industry to lend to. We will continue to engage closely with banks to monitor the situation, but as yet I am not hearing evidence from the industry that it is not getting loans where that is appropriate.
In the briefing that the NFU prepared for this debate, it called for mandatory food resilience assessments of new policies. I reassure Members that the Ag Act already commits the Secretary of State to consider the need to encourage the production of food. That is the basis of our new schemes and is very much part of the food strategy that was published a few weeks ago and embedded in departmental policy.
I want to briefly touch on the NFU survey that was mentioned by my hon. Friend the Member for Rutland and Melton, which suggested that a certain proportion of farmers are intending to reduce production or exit the industry. Surveys are useful and a helpful gauge of what is happening, but not all farmers are members of the NFU. It is important that we continue to monitor the situation closely. I am confident that we have strong and resilient food production in this country. The pig sector in particular is facing challenges. We believe that close to 60,000 sows may have been taken out of production over the last year, but we must put that in context: in 2021, the pig herd grew by nearly 10%, to the biggest it has been in 20 years.
I have worked extremely closely with the pig industry over the last nine months. There is still money being made in the pig world—not by the producers, I agree, but I am determined that the supply chain review is the way to go. I encourage anybody involved in the sector to lean in extremely heavily to the work we are about to launch in that sector. We need to make sure that the supply chain is fair, and we need to eat more British pig. We produce in this country about 60% of what we consume. I would very much like that figure to go up, not least for animal welfare reasons. I will do everything in my power to work with the pig industry—producer, processor and retailer—to achieve that.
In the arable sector, we are expecting increased yields this year, although I must confess that, as a cereal farmer, I look out of the window at very dry weather and worry—that will not surprise anybody—although our wheat area is in fact forecast to be up a little, by a percentage point. Winter barley is up about 10% and rape up about 9% from last year. There are of course real concerns about profit margins, and we have rehearsed the reasons why, although current indications are that the crop is expected to be good—as a farmer, I almost cannot say that sentence for fear of upsetting the harvest, but at the moment we are hopeful and confident in this year’s supply.
On the agricultural transition, direct payments are not a system that I am prepared to defend. Some 50% of direct payments go to 10% of the largest farms and landowners. There are better ways of spending the agricultural subsidy pot. Smaller farmers might well need further intervention if input costs continue to rise, but I am convinced that there are more targeted ways that we can help.
We opened the new sustainable farming incentive on 30 June and are pleased with the application rate so far. I should emphasise that throughout the agricultural transition, which is by its nature slow—we have purposefully worked over a seven-year period to enable farmers to adapt, change their ways and plan for the way that they run their businesses—the pot of money available to support farmers will remain the same for this Government. It will, however, be more targeted and be used to support public goods. We have ambitious environmental goals, which are generally supported across the House. Farmers want to help us to achieve those, and we want to reward them for doing so.
There have never been arbitrary divisions in how much money attaches to each sector of future farming schemes. Those schemes are very much designed to be stacked, so the SFI is not in itself intended to replace fully BPS, but should be stacked with the other schemes to ensure that farmers are properly rewarded.
In my view, subsidy is useful in agriculture, and I am very happy to argue across Government for the pot to remain at £3.7 billion. I think that is a good figure for us to spend on helping our farmers to produce public goods.
As I said, I do not think that direct payments are defensible. We as farmers received money for doing nothing but owning our land. In the future schemes, farmers may have to change their behaviours or work in a slightly more environmental manner. In some cases, they may have to change very significantly what they are doing on parts of their land. I accept that. This is change. This is difficult, but it is worth it for those nature gains and environmental and carbon capture gains, on which I know there is great consensus across the Chamber.
Farmers are dealing with this period of change and transition by voting with their application forms. Now, more than half of farmers, including myself, are in a stewardship scheme. Those are mid-tier schemes, and we have said that we will seamlessly transition farmers in such schemes into the mid-tier of the new future farming schemes. That is not a complete solution but it is a coherent interim one while we continue to work on the agriculture transition to get the policies absolutely right.
I think the food strategy will be welcomed by all Members who have spoken. The goal of food security has been mentioned across the Chamber, as has buying British. The land use strategy, which we will work on in 2023, will deal with some of the specific points raised in the debate, not least by my hon. Friend the Member for Rutland and Melton. As ever, I am happy to meet any Member’s farmers if they would find that useful. I accept that change is difficult. We need to help farmers to manage that and to continue to produce not only the food we love, but the public goods for which we are very keen to continue to pay them.
Thank you for your chairmanship, Mr Hollobone. I thank all those who have spoken with such unity. I particularly thank the Minister for her comments about land-based colleges—Melton Brooksby is one such exceptional establishment—and her commitments to the land use strategy and to continue conversations on labour schemes, gas fertiliser indexes and flexible loans.
This may be my last Westminster Hall debate with the Minister in her place, because she may be the Secretary of State by September—who knows?—or anything else. I thank her for her constancy, for her meaningful and heartfelt support for farmers across our country, for how hard she works, and for genuinely knowing her brief and fighting for it. I thank her on behalf of us all.
Question put and agreed to.
That this House has considered support for farmers with the cost of living.
Night-time Economy: Hertfordshire
I will call Dean Russell to move the motion, and then I will call the Minister to respond. There will not be an opportunity for Mr Russell to wind up, so he and the Minister get one go each. The debate is due to finish at 4.30, and I am advised that there may be five Divisions called then, so the Minister may want to ensure that she concludes her remarks before then.
I beg to move,
That this House has considered Pryzm nightclub and the night-time economy in Hertfordshire.
It is a pleasure to serve under your chairmanship, Mr Hollobone, and I am delighted to bring this debate to Westminster. The situation in Watford is worrying. Our high street, like everywhere over the pandemic, has been hit by challenging times, and Watford has one of the best high streets in the country. We have an incredible wealth of brilliant stores, organisations and small businesses that we need to continue to support. What I have found over the past few years, especially during my time as the Member of Parliament for Watford, is how much our community comes together, works together and supports each other, and that includes supporting our small businesses as we move forward.
We have a challenge: one of our most popular night-time destinations, Pryzm nightclub, is under threat. The situation at the moment is that there is a planning application in place to turn the nightclub and surrounding businesses into homes. I am not against new homes—it is important that we have them. I am not too keen on very tall towers, which is a totally different debate that I am sure we could have another time. The nightclub would close not because people are not going through the doors. It would close merely because a landlord wants to change it into something else—something that is not part of the night-time economy. The reason why that is a challenge is that the night-time economy, as we all know, is not just one place. It is not one nightclub; it is a whole ecosystem. It is an incredible ecosystem that includes local restaurants, bars, food outlets, takeaway places and our brilliant taxi trade, which all rely on the thousands of people who come to Watford every weekend to go to the nightclub.
Closing the nightclub would pull the rug from under those businesses and hard-working people who have struggled to get through covid over the past few years and have come through the other side. They survived it and are on the verge of thriving, but that would be cut off. My request to the Minister today, and I have a few points I would like to raise with her, is about how we can support the night-time economy in general. I appreciate that these are national debates, but Pryzm is a good example of the challenges we face as a community and as a Government who support small business. Losing places like nightclubs that allow the night-time economy to thrive would risk setting off a domino effect of closures and high streets not surviving, which will also impact tourism, trade and opportunity.
I would like to thank a few people. First, I thank Maria Manion, the chief executive of Watford business improvement district, or the BID, as it is often known. It has done incredible work looking at the impact of the closure and what it would mean locally, but it also does incredible work to support local businesses. I thank Dave Vickery, the manager at Pryzm Watford. I have been down there a few times—I can confirm I did not dance or drink. Dave is absolutely passionate, and I could tell the care his staff have for the people who go to the nightclub. They ensure that people have a safe and enjoyable evening out and that when they go back out on the street at the end of the night, they continue to have a safe journey home and a safe environment to go to the other businesses locally.
I have heard from Dave that places like nightclubs are communities. They are places where people go to see their friends at the end of each week, to start to relax and to use it as a release each week—one thing I am passionate about is people helping their own mental wellbeing. When we lose that, it has a damaging effect on not just the economy, but people.
Anyone watching the debate, especially from Hertfordshire —I am sure millions will be tuning in to this Westminster Hall debate—will know that Pryzm nightclub has also been known as Oceana, Destiny, Paradise Lost, Bailey’s and many other names. It has been on the parade for nearly 40 years, so it has not just popped up; it is part of the legacy there. I hope that I am not breaching their confidence, but there are people working in Parliament who met their partners there. The club has a legacy of people forging relationships and friendships there over many years, and it presents an opportunity for people to come together, celebrate and release after a hard week at work.
People might not be aware, but Pryzm does incredible work for local charities, including Watford Mencap, which I visited recently. The Mencap team takes 70 people—or clients, as they call them—to Pryzm for a safe night out on the last Friday of every month. There, they can have a drink in a safe environment and see friends whom they would not usually see. If Pryzm closes, nothing else they could do would come close to providing similar enjoyment in a safe community space.
I will raise with the Minister the impact on jobs and the night-time economy. Pryzm, has about 110 employees, and an average of 3,000 visitors over Friday and Saturday. On big event nights, including performances by big DJs, there can be many thousands more visitors, and Pryzm welcomes about 500 people on Mondays. That is absolutely critical, because each person will spend not just at Pryzm, but in the local area. I am particularly concerned for taxi firms, which had a really difficult time during lockdown. They struggled for every single fare, sometimes waiting hours for the next pick-up, before re-joining the back of the queue. Stopping their ability to earn from the night-time economy is a real travesty. The average spend at Pryzm is about £20 per person, but that equates to about £34 for our local economy.
Let me be clear: this is not just about Watford—I would not be so selfish as to focus only on Watford. If we lose nightclubs and the night-time economy in towns across the UK, we lose not just the economic benefit but part of our culture. Pubs are absolutely critical to what we think when we think of Britain—I do not think there is a single soap on TV that does not feature a pub. Most towns—not soaps—have a nightclub as well, or used to. People used to have a space—or perhaps a disco, for my generation—where they could go, but those spaces are dying out. That is a real challenge. I will not go into “Saturday Night Fever” mode and start dancing, but those places existed for so long for a reason: they drive so much opportunity for people, who can forge relationships there, as I said earlier.
I am also passionate about the creative arts. So many people get their first start at nightclubs and in night-time bars where music can be performed. It is incredible how many bands start by doing gigs in small towns, building their following until they can, potentially, tour around the world. Everyone wants that first step on the ladder. For creative people, having a home-town audience, or one in the surrounding area, to listen to, support and fund them can make a massive difference. Losing nightclubs would have massive effect on the future of the night-time economy. On the music industry, it is estimated that there were almost 1 million music tourists in the south-east prior to covid, supporting 5,300 jobs in the south-east alone. That is a huge number, and it goes to the heart of my concerns.
I will wind up with a few questions for the Minister because I am conscious that there will shortly be votes in the House. First, is there anything that I can do to encourage the council? I totally understand that it has to follow specific processes to agree or refuse planning applications—I am not trying to force them through—but how could I help before it reaches the point of refusing a planning application? Could I speak to businesses? Are there any support packages that could be used to help them and encourage them not to close this vital part of our community?
The Minister is new to her post, and she is doing an incredible job so far. I look forward to seeing her in post for a long time. I would like to ask what the Government are doing to support the night-time economy so that we can build on that. I think there are three questions. What can I do? What is being done? How are the Government supporting the night-time economy of the future, creative industries and, most importantly, small businesses?
It is a pleasure to stand before you for my first Westminster Hall debate, Mr Hollobone. I congratulate my hon. Friend the Member for Watford (Dean Russell) on securing this important debate. Clearly, this is an important issue for him and his constituents. I ought to say that my hon. Friend does an excellent job for Watford. None of his colleagues could ever say they do not know anything about Watford, because he is constantly going on about Watford. Good for him. It is much appreciated, I am sure.
I recognise that this is a local, commercial planning matter. Providing new homes to ease pressure on the housing market is obviously important. It is also important to preserve commercial areas, which are fundamental to the health of local economies and communities. Hospitality, alongside retail, personal care and leisure, is part of an ecosystem, as my hon. Friend said, that underpins healthy local economies and communities. This ecosystem includes a symbiotic relationship between businesses operating during the day and evening, and businesses operating into the night. I have talked to the Department about the day-time, night-time and twilight economies and the connection between them. I am sure that is where much of that £34 is being spent before people go on into the nightclub.
If the night-time economy fails, it has a detrimental impact on the ecosystem as a whole. As well as providing accessible jobs and stimulating local supply chains, hospitality businesses support tourism, help to attract inward investment, generate income for local authorities to invest in services and infrastructure, connect communities and support mental health, just as my hon. Friend said. All that helps to improve living standards and creates desirable places for people to visit, study, live and work.
While increasing the number of residents living in our town and city centres is a good thing for local economies, businesses and residents need to be able to co-exist. However, we know from experience that residential areas and night-time economy businesses do not necessarily co-exist well. We have seen many cases of long-standing businesses being forced to close under the weight of complaints about noise from new residents. To ensure a healthy business environment that will deliver for local economies and communities, this ecosystem needs to be managed, and it needs to support and complement wider plans for economic development, regeneration and levelling up.
It is important to talk about levelling up. People think about levelling up as being for places other than the south-east. In fact, it is just as applicable to Watford as it is to Loughborough or any other town in the country. Levelling up for most parts of the country will involve improving productivity and economic growth by encouraging innovation, creating good jobs, enhancing educational attainment, and renovating the social and cultural fabric of the parts of the UK that are falling behind. Investing in education, digital connectivity, housing and transport to attract new business investment, as well as attracting and retaining talent, is a key part of levelling up. Increasing the number of overseas tourists visiting the UK and achieving a better distribution of tourism across the UK is also an important part of levelling up.
In 2019, 40.9 million overseas residents visited the UK, spending around £28.4 billion. Of those staying at least one night, 21.7 million visited London, while 2.2 million visited Edinburgh, 1.6 million visited Manchester and 1.1 million visited Birmingham. As my hon. Friend said, this is about Watford specifically, but it is also about the night-time economy across the whole country.
Creating the right environment for high street businesses to flourish is vital to creating destinations that will appeal to entrepreneurs, students and tourists alike. Research by Centre for Cities on healthy local ecosystems for students and graduates highlights the importance of attracting new students to bolster local economies, as they tend to spend their money where they study. A place’s ability to attract students from other parts of the country will therefore affect the strength of its economy, and the night-time economy would definitely attract the student population. Moreover, as the UK continues to specialise in more highly skilled, knowledge-intensive activities, the extent to which cities can attract and retain skilled graduates will have a big impact on their economic performance.
As constituency MPs, we know that hospitality and nightclubs are important, and clearly that is why my hon. Friend brought this matter to the House. Nationally, hospitality employs 2.4 million people, and there are 167,000 hospitality businesses, creating £83 billion in revenue in 2021.
Given that I am debating my private Member’s Bill on tips on Friday—I just want to give it a plug—I want to point out the importance of the hospitality sector. It is important that staff can keep the tips that are given to them, and I hope the Minister agrees with me on Friday when she is at the Dispatch Box.
I welcome the introduction of my hon. Friend’s private Member’s Bill. Ensuring that tips go to workers is the right thing to do. It is a policy that my Department has worked hard on, and I look forward to responding to him on Friday.
We are working to make permanent many of the regulatory easements that we introduced during the pandemic, which not only provided hospitality businesses with greater flexibility to trade but helped to create the vibrant, bustling outdoor spaces we need to encourage people back into our town and city centres. In July 2021, we published the first ever hospitality strategy, which set out our ambition for the recovery and future resilience of the sector, and we have established a Hospitality Sector Council to oversee its delivery. We did all that because we recognise the importance of hospitality not just nationally but locally. If we are to maximise the potential of hospitality to support our local economies and communities, stimulate inward investment and tourism, and help levelling up across the country, we need to cultivate and nurture our local high street ecosystems. We have talked about those things.
As I say, the planning mechanisms are the way forward, and unfortunately they are not with the Department for Business, Energy and Industrial Strategy but with the Department for Levelling Up, Housing and Communities. However, I understand that DLUHC is bringing forward planning matters that could be dealt with through the Levelling-up and Regeneration Bill, which might include an auction after a year if a building remains empty. I am not sure whether that would happen in this case, but it is still worth bearing in mind for colleagues across the country.
I congratulate my hon. Friend on securing this important debate and giving us an opportunity to discuss this issue in Parliament. Although this is very much a local planning issue, it raises important questions about how we manage the transition of our high streets from being fundamentally retail centres to being more experiential spaces where we meet the needs of local residents and attract new footfall. I believe that, in this case, that can best be achieved by local authorities working closely together with local delivery partners—clearly, that has happened with the bid—interested groups, businesses and landlords. I thank my hon. Friend very much indeed for bringing this matter forward.