Brexit: Food Prices and Availability (EUC Report) - Motion to Take Note

Part of the debate – in the House of Lords at 2:22 pm on 25th April 2019.

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Photo of Lord Carrington Lord Carrington Crossbench 2:22 pm, 25th April 2019

My Lords, I declare my interests as a farmer, as set out in the register. I had hoped to speak after my noble friend Lord Devon so that I could already have bathed in his wisdom, but all I can do now is wish him luck. I welcome this debate on the report but regret that it comes nearly one year after publication. Much water has passed under the bridge, therefore while I welcome the report and agree with most of its recommendations and conclusions, I will now highlight what is relevant but missing.

Much has been written, both inside and outside Parliament, on the likely impact of Brexit on food prices and availability, but to me the one thing that is obvious is that until the scope and timing of Brexit is clear, all we can do is make informed guesses. With so much outside the control of this country—third-party status, negotiations with non-EU countries, non-tariff barriers, visa restrictions and much else—the most sensible approach is to identify those areas where we have control of the agenda and do not need the approval of third parties, and make sensible reforms forthwith.

In this respect I direct your Lordships’ attention to the fact that currently we produce 60% of our food, and with improvements in technology, good husbandry, capital investment and suchlike, we could increase this percentage, particularly in fruit and vegetables. However, one of the most important factors for our producers and consumers is that we have a comprehensive food strategy and an agreed agricultural policy that enables long-term decisions to be made with a degree of certainty that the rules will not change in the investment cycle. I therefore seek clarity from the Government on when this House will be able to consider the Agriculture Bill, which appears to have become stuck on Report in the other place since September of last year. Why are we waiting, when the finalisation of that Bill will provide the certainty that farmers require and enable sensible investment that should benefit both food prices and availability?

Many aspects of this important Bill need to be further discussed and hopefully amended, but it is firmly in our hands and does not require the approval of Brussels or anyone else. Briefly, the Bill sets out the transition from area-based subsidies to payments to farmers for public goods. Personally, I have no real objection to this change, as long as food production is classed as a public good. The policy will, I hope, improve our degraded soils and fragile wildlife, but I have a concern about the scant reference to the production of all-important food. This was certainly picked up in the other place, in particular by the honourable Member the SNP spokesperson Deidre Brock, who said:

“We have a Bill to regulate agriculture that is silent on the very essence of agriculture”.—[Official Report, Commons, 10/10/18; col. 171.]

As in all things, there has to be compromise, particularly when we are deciding between the balance of environmental benefits and food production. We also need to understand that currently subsidies account for between 50% and 80% of a farmer’s income. The farming industry is likely to be very financially vulnerable for some time while the necessary changes are made to its business models.

Bearing in mind that upland farming needs all the help it can get, whereas grade 1 land requires no area-based subsidy, people seem to forget that a huge proportion of farmland in this country is of pretty average quality and beauty, and its profitability has been highly dependent on the basic payment subsidy. With the steady withdrawal of this subsidy, many farmers of this land will be looking around for the best option available to guarantee that they get a steady and predictable income with as little risk as possible. The Government’s proposed new environmental land management system—ELMS—is likely to attract many, but potentially at the cost of lowering food production in this country. Growing crops will be inherently more risky because there will be no subsidy to fall back on in the event of some disaster related to commodity prices, climate events or disease.

We do not want to discourage sensible food production at a very uncertain time. People will say that the environment will benefit and the public will benefit from increased access, but we cannot eat the environment or graze ewes with lambs in a public playground. We need to study closely the clauses in the Agriculture Bill that cover the circumstances for intervention in agricultural markets and thereby provide farmers with a safety net to justify their taking additional risk rather than just harvesting subsidies. The intervention clauses are currently based on the existing common market organisation regulation—CMO—which now looks a little dated.

Surely we should be looking at other support mechanisms that are used around the world to support farmers in the event of the advent of factors outside their control. In this respect I urge the Government to look at insurance mechanisms, whereby farmers pay premiums to an insurance scheme supported by government. We could also look again at the cereals deficiency payments scheme that operated before we joined the EEC. Such schemes help to address the harmful effect of uncontrollable adverse events on producers, which is also of benefit to consumers, as it enables farmers to survive events that are out of their control and continue to produce, rather than going bust.

This is not the moment to go into the detail of the Agriculture Bill, but purely to make the point that we are wasting valuable time by not addressing domestic issues completely under our control that could have a significant impact on food production in this country. This would be a major contribution to the stabilisation of prices and availability of food.