Amendment 90

Agriculture Bill - Committee (4th Day) – in the House of Lords at 5:00 pm on 16th July 2020.

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Baroness Bennett of Manor Castle:

Moved by Baroness Bennett of Manor Castle

90: Clause 1, page 3, line 5, leave out “or plants” and insert “, plants or fungi”

Photo of Baroness Bennett of Manor Castle Baroness Bennett of Manor Castle Green

My Lords, in moving Amendment 90, I will also speak to Amendments 196 and 206 in the name of my noble friend Lady Jones of Moulsecoomb, which concern animal welfare and which I commend to the Committee, and Amendment 207, which concerns the role of the Groceries Code Adjudicator.

I shall speak to Amendments 90, 184, 188, 189, 286, 287, 288, 292, 293 and 294; I thank the noble Baroness, Lady Boycott, for her support on them. They are all about references to fungi. I have to credit the campaigning group Plantlife, which identified this issue for me and did all the fine-comb work to produce these amendments. I feel that I am contributing to successful answers to pub quizzes up and down the land in saying that there are three kingdoms in the living world—plants, animals and fungi—which together make up the eukaryotes: the organisms with complex cells with features such as mitochondria and nuclei. In fact, fungi are closer to animals than plants. They are not producers of energy but use external sources of it; indeed, the world would soon be covered in undigested waste if they did not.

On many occasions in your Lordships’ House, I say, tongue in cheek, “I am sure that the Government will agree with me,” but in this case I say it with absolute sincerity. I am sure that the Government want our legislation to be scientifically literate. As this legislation currently says, “‘plants’ includes fungi”, it is not. It is like saying, “For ‘apples’, read ‘pineapples’”. That is very easy to fix—and would, I believe, have the added virtue of legal clarity. I am sure that we all recall the arguments about the classification of Jaffa Cakes as cakes or biscuits with regard to VAT. We do not want to see similar arguments in relation to support under this Bill. This Committee must consider why we currently have such confusion. The importance of fungi is grossly understated and still little understood.

I outsourced this speech in part to social media, where mycologists leapt in to offer some suggestions. To start with the familiar, I point your Lordships to fly agaric, the red and white fairy tale favourite, but until mycologists started talking to me, I did not realise how crucial it is, to the growth of birch trees in particular. I also cannot resist noting Phallus impudicus—I leave noble Lords to look up its common name—which is thought to have a close ecological relationship with badger setts. Its scent attracts blow-flies that quickly clean up the bodies of badgers, which most typically die underground—unless there is a badger cull, of course. I note that up to a third of plants’ products of photosynthesis feed fungi and bacteria in the soil. For example, relationships between bacteria help mycorrhizal fungi to use their hyphae to seek out and scavenge particularly biologically valuable elements such as phosphorus from rocks or decaying organic matter.

These are immensely complex and little-understood natural systems. Other noble Lords have said that they imagine the countryside operating like a giant, human-directed machine, with robots buzzing around and everything controlled by chemical application and genetic modification. I would point to the complexities I just outlined to illustrate how faulty that vision is. We do not understand all that, but we do understand the basic biology and we can get it right in the Bill. I look forward to the Minister’s response and beg to move.

Photo of The Earl of Caithness The Earl of Caithness Conservative

My Lords, I will speak to Amendments 177, 179, 180, 182, 186, 188, 190, 191, 192, 193 and 194, which are in my name. We are moving away from fungi, but I say this to my noble friend the Minister: it is not helpful to group such a mass of contradictory and different issues together. My amendments deal with the supply chain and the collection and processing of data, which are rather different to what the noble Baroness was just talking about.

The Bill has incorporated some safeguards around the collection and processing of data to ensure that it is clear how information will be used and how it could be used in accordance with data protection legislation. However, I still have concerns that not all the purposes for which information can be processed relate directly to improving supply chain transparency or supporting the development of risk management tools to help farmers to manage volatility. I therefore want to see these purposes drafted in a more focused way to ensure that they achieve the legitimate aims of improving transparency and managing volatility.

The purpose for which information can be processed under this clause should be linked directly to the overarching objective of improving fairness and transparency in the supply chain. The requirements to provide information will inevitably lead to an increased administrative burden for businesses, and it is therefore important that any information collected is focused on helping those in the agri-food supply chain to make improvements—hence the need for Amendment 177.

Turning to Amendment 190, the Bill as currently drafted provides for information to be processed for wider environmental and waste purposes which do not link specifically to assisting those in the agri-food supply chain. This amendment would focus the processing of environmental and waste information and avoid it being used to pursue wider environmental objectives more appropriately pursued under other legislation such as the Environment Bill. It would enable the Government to collect the kind of information they have stated they are interested in, but would curtail the use of the provisions for purposes which go beyond specific issues in the agri-food supply chain in future.

The Minister will know that the data collection provisions are welcomed by farmers. They should be used in a focused and proportionate way to ensure that the additional administrative burden placed on businesses directly improves the fairness and transparency of the agri-food supply chain. Most of us will be able to remember the days when MAFF was notorious for gold-plating regulations. Therefore, it is very important that these regulations and this part of the Bill are sensibly drafted so as not to impinge too much on farmers.

Photo of Lord Lucas Lord Lucas Conservative

My Lords, I shall speak to the amendments in my name in this group.

Amendments 178 and 181 suggest an additional scope for the power to get information. We should look at activities which affect the UK and not just at those that take place in the UK. A lot of these food supply chains are international and many of their activities and decisions take place outside the UK—indeed, all that may happen in the UK is that some goods turn up and are dropped off at someone’s warehouse, with all the information about where they have come from, what they are and what the resilience of the food chain is being held outside the UK. So it seems to me that we should have the wording “activities affecting the UK” rather than “activities in the UK”.

These amendments also extend the power to get information to Clause 17, which is on food security. We say that we will do a lot of things with information there, but I cannot see that we have given ourselves the power to get the information we need, which again is likely to be held outside the UK in many cases.

Amendment 185 argues for a wider definition of persons “closely connected” with the food chain and lists a number of activities that are fundamental to a food chain but are not presently listed in the Bill.

Amendment 183 comes back to the plants and fungi of the noble Baroness, Lady Bennett. It is not clear to me that the present wording in Clause 22(2)(c),

“any creature or other thing taken from the wild”,

includes plants. Clearly there is a substantial trade in plants and fungi taken from the wild, which ought to be comprehended in this Bill. I entirely sympathise with the irritation of the noble Baroness at fungi being subsumed into “plants”—but in a House where male embraces the female, perhaps this is a fault that we are used to.

Photo of Lord Empey Lord Empey UUP 5:15 pm, 16th July 2020

My Lords, I will speak to Amendment 195 in my name and that of the noble Earl, Lord Dundee. I note that there are a variety of amendments to this amendment, including one from the noble Lord, Lord Grantchester, about which we will hear shortly.

The explanatory statement for this amendment says that it

“requires the Government to provide regulations for fair dealing obligations of business purchasers of agricultural products.”

I am sure that we would like to see a day when farmers were not reliant on subsidies to maintain a sustainable income, but, on the other side of the coin, it would not be possible to encourage a rise in food prices when so many people in this country are suffering from food poverty as it is.

The fundamental point I wish to make with this amendment is that the distribution of income within the sector, from the production of food to the retail sector, is not balanced. It is fundamentally unfair. For many years, it has been the case that profit margins within the processing and retailing sectors can be substantially more while the primary producer—the farmer—can barely make a profit on the produce at all.

As a Minister in Northern Ireland who dealt with the food processing sector for a number of years, I saw examples of producers driven down to maybe half a penny of margin on a product. In the days before the Groceries Code Adjudicator was appointed in 2013, there were examples where companies would just say to the producers and processors, “We’re going to extend our credit terms and we’ll not pay you now for 90 days instead of 30”, and apply continuous pressure to drive down the margins. Now business is business, but when you have to substantially subsidise the primary producer through the taxpayer, you need a proper structure to ensure that there is a fair balance at the end of the day.

The remit of the Groceries Code Adjudicator is too narrow. It does not cover indirect suppliers to supermarkets, meaning that many farmers and small food businesses are not protected by the adjudicator or the code. We need an expansion of powers to cover the widest possible extent of the food supply chains that serve our supermarkets. This is not a new idea; in 2008 the Competition Commission looked at grocery supply chains and proposed the establishment of the Groceries Code Adjudicator to tackle unfair trading practices. This report also anticipated that the GCA’s remit may be insufficient, noting that that, if these practices continued, the Government

“should consider the introduction of appropriate measures, including the extension of … the role of the Ombudsman”— namely, the Groceries Code Adjudicator.

During the past two decades, there has been significant consolidation within the retail and food processing sectors, adding to an imbalance in the market. Primary producers generally do not obtain fair prices and on many occasions do not cover the costs of production. This situation requires political intervention to protect what remains of our farming sector and to assist its rebuilding. We know about imports, weather and other factors, but the fact is that there is a persistent imbalance in the distribution of wealth within the sector from the primary producer to the retailer.

We are at a point of almost generational change with this Bill, and this is an opportunity to reset the clock on how we do this fairly and reasonably. We know that we want to see more food produced in the UK, and we want that food to be of an even higher quality than it is now. We want to see standards maintained. However, we also need investment by the primary producer, and a primary producer cannot invest properly in that business unless they are making money. Therefore, it is in all our long-term interests—not only for food security but for a whole lot of other reasons—to take this opportunity to take positive action to assist our farming community.

It is not simply to add costs to the sale of food in shops, it is to help with the equitable distribution of income and reflect a reasonable return on capital in the profits a farmer can make. That is nothing dramatic: all businesses need that, and I do not see why it should be any different with primary producers. I therefore support this amendment and others of a similar nature in this group.

Photo of Lord Grantchester Lord Grantchester Opposition Whip (Lords), Shadow Spokesperson (Energy and Climate Change), Shadow Minister (Environment, Food and Rural Affairs), Shadow Spokesperson (Business, Energy and Industrial Strategy)

In speaking to this very extensive group of amendments, I will speak to Amendments 195A to 195F in my name, and to Amendments 197 to 200 in my name and that of my noble friend Lady Jones of Whitchurch, with implications for Amendment 207 in the name of the noble Baroness, Lady McIntosh of Pickering.

These amendments are primarily focused on Clause 27, which deals with the “fair dealing” of agricultural producers in the agri-food supply chain. They come from my experience—as shown by my interests declared on the register—representing mostly dairy producers and dairy processors, and my directorship of a farmers’ co-operative that processes members’ milk and markets produce in the supply chain, and, crucially, from my understanding and experience of the disruption of the food chain following the difficulties of the Covid-19 pandemic.

I very much welcome the “fair dealing obligations” introduced into the Bill in the provisions of Clause 27 and others. The relative imbalance in market power between primary producers at the foot of the supply chain and those at the top of the chain, selling the finished product or meal to the consumer, has long been understood. What happens in between can be a murky business of relationships, given the many channels to the market and the perishable, short-shelf-life product with its various, highly regulated processes.

This imbalance in bargaining power was recognised again as recently as February 2018, in the Government’s response to the call for evidence in the case of extending the Groceries Code Adjudicator’s remit in the groceries supply chain. The Government recognised examples of unfair terms and unclear contracts that led to a general lack of trust and transparency, discouraging good relationships across the supply chain. That the Government recognise that the problem is ongoing, and are now addressing it in the Bill, is to be welcomed.

Clause 27 gives the Secretary of State powers to make regulations “in relation to contracts”. My first amendment, Amendment 195A, is an amendment to the amendment of the noble Lord, Lord Empey—I thank him for his opening remarks—and the noble Earl, Lord Dundee, which seeks to replace “may” with “must” and to establish a timeframe of 12 months in which regulations must be introduced. Progress must be made swiftly; the problems are well known. The impacts of Covid-19 on the supply chain have also become well known and have been answered in the competitive legal structure in emergency regulations, but their effects have yet to be assimilated.

Amendments 195B, 195C, 195D and 195E are designed to be all-inclusive: first, across all business purchases; secondly, across all farming sectors listed in Schedule 1, and, thirdly, across all dealings between purchasers and sellers. Lastly, the Secretary of State must promote fair dealing outside of a contract, as well as within the terms of a contract.

A contract is often drawn up by the purchaser rather than the seller and may contain only necessary provisions around the supply and payment for an agricultural product. It is important that Clause 27 must not be interpreted only with regards to the dealings in a specific contract but encompass all dealings. It would be important for the regulations to address, as a baseline, good basic business practice of fair dealings, and then to address fair dealings in contracts. The regulations must go to the heart of the matter: an enforceable fair dealing code of practice.

Amendment 195 reflects on the disruption to supply relationships caused by the pandemic. The immediate closure of all food service sector outlets—canteens, restaurants, cafes, coffee shops and snack bars, which make up 50% of all food purchases made out of the home—cut off at a stroke all the supply lines. There was suddenly nowhere for food products in the food service sector to go. There was a relative rebalance to retailers and local outlets following this. The effect was for purchasers of primary products to push enterprise risk down to the producers and sellers of products—the farmer—citing force majeure as a reason to refuse contract fulfilment. I am pleased to say that retailers largely stood by their responsibilities to the supply chain.

This experience has severely affected the faith of sellers in fair dealings. Will provisions on fair dealings in Clause 27 be sufficient to deal with these experiences in the future? How will they deal with a similar possible disruption, whether in the extreme—as in the pandemic— or in many other examples which may be more localised and more specific to the food sector, as in Schedule 1, where purchasers may have difficulties making payments for produce? How will the balance of risk be assessed in these regulations? Will the provisions of the Bill cover the situation?

I think the Minister will agree that this is entirely different from circumstances covered under “Exceptional market conditions” in Clauses 18 to 20, in Chapter 2 of Part 2 of the Bill. These clauses give powers to the Secretary of State similar to those pertaining to the EU Commission: to step into the market to stabilise it where there are disruptions from extreme weather circumstances.

I turn now to Amendments 197 to 200, and my comments are also made in relation to Amendment 207, on the same issue, in the name of the noble Baroness, Lady McIntosh of Pickering. These amendments are made to probe the Minister on how these regulations will operate in the marketplace, how they will be governed and by what authority or office. Subsection 9 of Clause 27 states that powers under subsection 1(b), to make regulations for the enforcement of obligations imposed by fair dealings, can be conferred on “any person” who will have

“discretion in dealing with any matter.”

I ask the Minister to explain who any such person may be, and how this discretion will be made effective. My noble friend Lady Jones and I have suggested the Groceries Code Adjudicator, to stimulate comment and debate.

The amendment of the noble Baroness, Lady McIntosh of Pickering, also suggests extension to the provisions of the Groceries Code Adjudicator Act 2013. I will not take up all the space on this subject, except merely to say that the exercise in the retail trade of fair dealing functions in relation to the 13 main retailers will be very different from what will be necessary across all sections and all sectors of the agri-food supply chain.

The remit of the Groceries Code Adjudicator came out of two Competition Commission inquiries and considerable debate over the course of at least a decade. I pay great tribute to Christine Tacon, the adjudicator. She has operated with a very small office and has brought, over the seven years since enactment, a large understanding of responsible dealing in the retail supply chain, which, to some extent, has been embedded further down the supply chain by large retailers with exposure to the stock market and a recognition of reputational damage through strong audit and risk committees. It would be a very different experience across the whole agri-food supply chain, with thousands of sellers in business relationships with possibly up to 10,000 purchasers.

The groceries code is financed by contributions from the retailers. How will this be financed? The experiences are unlikely to be the same in all food service and ingredients markets. The issues of price and relative percentage of market returns and fair shares do not feature in the operation of the groceries code. The monitoring of this legislation in GSCOP provisions is undertaken in a different department—BEIS, not Defra.

The focus of the adjudicator’s office will invariably change in addressing the scope of these regulations. Could the operation of the Rural Payments Agency be an alternative organisation? I will not debate the relative merits of this but will mention it to the Minister, who is very familiar with that organisation, so that he can give a full account regarding how these provisions will become operable.

Who operates these functions may be more important than the specific office. I am sure Christine Tacon would be able to give valuable advice to the RPA if it has powers to undertake these functions. If the UK had remained within the EU, we would have had to implement the provisions of the unfair trading practices directive. If any modelling of these provisions has been undertaken by the Minister’s department, I would welcome the Minister’s reply on his department’s views reflecting on that possible experience.

If the Bill is to be effective in rebalancing the relationships, as is required in the supply chain, the whole industry will be keen to understand how this will be made to work. If the Government have a new operation in mind, this would require setting up in primary legislation and, therefore, should have been included in the Bill. Many thanks.

Photo of Baroness Jones of Moulsecoomb Baroness Jones of Moulsecoomb Green 5:30 pm, 16th July 2020

My Lords, this is quite a mixed bag of amendments, but I accept that if we separated them out, we might never see the end of the Bill before we all experience collapse. I of course support the amendments of my noble friend Lady Bennett of Manor Castle on ensuring scientific accuracy in the drafting of the Bill. I stand—or sit—in awe of her erudition when explaining this subject.

I speak to my Amendments 196, 201 and 206 on animal welfare, and I support Amendment 207 on the role of the Groceries Code Adjudicator. My amendments would require improvements in animal welfare to be made via the mechanisms established in Clauses 27, 28 and 30. Amendment 196 requires contractual rules that raise standards above the statutory minimums. Amendment 201 requires trade groups relating to animal products to appoint a person responsible for monitoring and improving animal welfare. Amendment 206 requires the Secretary of State to consult representatives of the animal welfare sector.

These are all opportunities to improve animal welfare in our farming system, and to use the Bill as a force for good. I hope the Minister will commit to integrating more animal welfare measures into the Bill on Report. This is one of the issues very close to my heart; I am therefore more than happy to talk this through with the Minister to see if we can, perhaps, do it my way.

Photo of Lord Carrington Lord Carrington Crossbench

My Lords, I declare my interest as a farmer and landowner, as set out in the register. I shall speak to Amendments 202, 203, 204 and 205 in my name. The basic purpose of these amendments is to set the conditions in which future delegated legislation under the auspices of this Bill is fair, transparent, responsive, proportionate and equitable.

Amendment 202, on publishing information related to producer organisation grants, seeks to delete the requirement to publish grant application decisions online. Such a requirement is disproportionate, and the publication could contain commercially sensitive information that buyers could seek to use against the producer organisation.

Amendments 203, 204 and 205 relate to competition law. I fear there are no baubles here; we begin to get technical. The Competition Act 1998 contains the following exemption in relation to agricultural products:

“The Chapter I prohibition does not apply to an agreement to the extent to which it relates to production of or trade in an agricultural product and—

(a) forms an integral part of a national market organisation;

(b) is necessary for the attainment of the objectives set out in Article 39 of the Treaty on the Functioning of the European Union; or

(c) is an agreement of farmers or farmers’ associations (or associations of such associations) belonging to a single member State which concerns—

(i) the production or sale of agricultural products, or

(ii) the use of joint facilities for the storage, treatment or processing of agricultural products, and under which there is no obligation to charge identical prices.”

I did not write that.

As currently drafted, the Agriculture Bill removes this exemption and replaces it with exemptions relating specifically to producer organisations, associations of producer organisations and recognised interbranch organisations. In doing this, the current exemption for agreements, which is necessary for the attainment of the objectives set out in Article 39 of the Treaty on the Functioning of the European Union—in other words, the common agricultural policy objectives—is removed. There does not appear to be any justification for the removal of this exemption, particularly during the period when the UK’s domestic agricultural policy is being developed. If an agreement between farmers is necessary to achieve the current CAP objectives, it should remain exempt from the prohibition of agreements contained in Chapter 1 of the Competition Act 1998. The removal of block exemptions from specific aspects of competition law, with no clear justification, is concerning. It is necessary to understand whether there is any objective and sensible justification for removing the existing agricultural exemption. I would be most grateful for the Minister’s comments.

Photo of Baroness Boycott Baroness Boycott Crossbench

My Lords, I would first like to add my voice to the praise of the noble Lord, Lord Grantchester, for Christine Tacon while she was in the role of Groceries Code Adjudicator. It is a very important role, and I would like to hear whether the Minister plans to beef it up and give her more powers.

Following what the noble Baroness, Lady Jones of Moulsecoomb, said about animal welfare and the need for someone to look over it, it occurs to me that someone in a similar position to the Groceries Code Adjudicator, overlooking the welfare of animals with the power to fine and bring people to book, might be worth looking at.

I am here to make a brief intervention to support the noble Baroness, Lady Bennett of Manor Castle, because I am a bit obsessive about fungi and feel that they are overlooked. They were once classified as plants because they come out of the soil and have rigid cell walls, but are now placed independently in their own kingdom with equal rank to animals and plants. In fact, they are nearer animals than plants.

An astonishing though not well-known fact, which I thought your Lordships might like to know, is that the world’s largest living organism is thought to be a honey fungus measuring 3.4 miles. It is across the Blue Mountains of Oregon and estimated to be 8,650 years old. Obviously, what we know better are varieties such as mushrooms, which are important to our diet and packed with vitamins and minerals. But they are also incredibly important to research. Penicillin, the foundation of all our modern medicine, comes from the fungus Penicillium. The everyday product yeast is also a fungus. While some can make you ill, they are essential in chemicals and drug manufacture. I know, as I travel to South America quite a lot, that scientists know that there is much more to discover about this amazing microscopic world.

From the point of view of the Agriculture Bill, fungi have the most enormous environmental benefit. They feed on dead organic matter, including leaf litter, soil and, of course, dead animals. They recycle 85% of the carbon from dead organic matter and release locked-up nutrients to be used by other organisms. This makes fungi completely essential to the ongoing health of our ecosystems. Sustainable life would not have a prayer without this magical, often microscopic, and too often ignored living group. This speech was to bring this to the Committee’s attention, and to say that I hope it maintains a proper place somewhere in the Bill.

Photo of Baroness McIntosh of Pickering Baroness McIntosh of Pickering Conservative

My Lords, I shall speak to Amendment 197 in the name of the noble Lord, Lord Grantchester, and the noble Baroness, Lady Jones of Whitchurch, and Amendment 207 in my name and those of the noble Baronesses, Lady Jones of Moulsecoomb, Lady Ritchie of Downpatrick and Lady Bakewell of Hardington Mandeville, and I thank them for their support.

Amendments 197 and 207 seek to achieve the same aim, which is to ensure proper scrutiny of the new supply chain measures being introduced under the Bill, which are to be greatly welcomed. I too congratulate and pay tribute to the Groceries Code Adjudicator, Christine Tacon, and her team for all that they have achieved under the code. The adjudicator has done a very good job in regulating the relationships between the major retailers and their direct suppliers.

However, I believe there has been a major regulatory gap in respect of relationships further upstream in the supply chain involving primary producers, the first purchasers and processors—what I refer to as the indirect supply chain. While it is good news that the Bill attempts to plug that gap, it is disappointing that seemingly little thought has been given to how the new arrangements contained in the Bill are to be governed. I understand that there have been discussions between officials and interested parties, and within those it has been suggested that for some reason the Rural Payments Agency could provide the oversight for these aspects of the Bill. I beg to differ. The RPA is not the appropriate body. It lacks the necessary skills, capacity and gravitas to be able to adequately deal with these aspects of the Bill, and is in any event sufficiently employed with its daily work.

Although the Bill is sponsored by Defra, it would be good to see a little joined-up thinking within the Government so that Defra and BEIS were on the same page in their approach to this. BEIS would like to expand the remit of the Groceries Code Adjudicator to cover these new and important provisions, thus creating one single regulator from farm to fork. I hope that Defra will hold the upper hand and ensure that supply chains are functioning well for the long-term benefit of UK citizens, and the Groceries Code Adjudicator is the right body and team to do that.

These matters were considered in a recent review of the role and remit of the Groceries Code Adjudicator, and it is disappointing that at that stage BEIS decided against an expansion of the adjudicator’s remit. However, now that Defra has identified the need in the Bill for further supply chain provisions, with which I wholeheartedly agree, it seems perfectly sensible to give responsibility for the oversight of those arrangements to a body that is tried and tested and already has skills and expertise in this area. Without an adequate regulator identified in the Bill, we run the risk that the provisions on supply chains will simply not be adequately administered or enforced. As the noble Lord, Lord Grantchester, the noble Baroness, Lady Jones of Whitchurch, those who have co-signed Amendment 207 and I have identified, the Groceries Code Adjudicator is the right place for this work to be conducted.

With regard to the wider remit, there are many reasons to include the indirect supply chain. More often than not, they are small growers or producers. It is very difficult for them to bring a complaint. I would like to see an own-initiative investigation started by the Groceries Code Adjudicator because it is difficult to rely completely on complaints from small producers and growers, which can so easily be identified with those with whom they have the contract and so fear losing the contract. With those few words, I commend Amendment 207 and support Amendment 197.

Photo of The Earl of Dundee The Earl of Dundee Conservative 5:45 pm, 16th July 2020

My Lords, I support Amendment 90, moved by the noble Baroness, Lady Bennett of Manor Castle, which includes fungi as subject to conservation, and Amendment 183 from my noble friend Lucas, which also covers wild plants within an agri-food supply chain. Through Amendments 178 and 185 respectively, my noble friend Lord Lucas also points to the need for a proper analysis of agri-food supply chains, not least to that for relevant data collection in the first place.

With Amendments 187, 190 to 192 and 194, on how information itself should be best gathered through tactful and fair-minded approaches to people asked to give it, my noble friend Lord Caithness offers excellent guidance, as does my noble friend Lord Carrington with a number of proposals, including Amendment 203, which would retain the current common agricultural policy objectives exemption from competition law for relevant agreements.

Therefore, I hope that my noble friend the Minister may agree that, taken together, and if incorporated within the Bill, all these proposed adjustments, mainly concerning information and analysis, would provide useful and necessary checks and balances, and equally that he might feel able to support Amendment 195, tabled by my noble friend Lord Empey and myself, which would ensure the provision of regulations for fair-dealing obligations of business purchasers of agricultural products.

Photo of Baroness Ritchie of Downpatrick Baroness Ritchie of Downpatrick Non-affiliated

My Lords, I support Amendment 195 in the name of the noble Lord, Lord Empey, and the noble Earl, Lord Dundee; Amendment 197 in the name of the noble Lord, Lord Grantchester, and the noble Baroness, Lady Jones of Whitchurch; and Amendment 207 in the name of the noble Baroness, Lady McIntosh of Pickering, to which I and others are signatories.

Clause 27 is about fair dealing with agricultural producers and others in the supply chain. For a considerable time I have felt that there has been an imbalance in the supply chain that has been disproportionate and has had a diminishing impact on producers. If we believe in public money for public goods, we should be trying to cherish and protect our farm producers.

The Groceries Code Adjudicator is perhaps a very good place for the regulations specified in Clause 27 to be enforced. I would like the Minister to indicate how the regulations will be governed; in the absence of that, I can see a need for proper scrutiny and oversight of the supply chain. That is a missing area. Surely the oversight could be provided by the Groceries Code Adjudicator.

I pay tribute to Christine Tacon. I recall that when the noble Baroness, Lady McIntosh of Pickering, was chair of the Environment, Food and Rural Affairs Committee in the other place, of which I was also a member, we took evidence from Ms Tacon and examined the relationships within the supply chain.

I also believe—and this is a singular view—that smaller retailers should be subject to scrutiny as well, because they have caused many major problems for producers in our supply chain.

We need greater joined-up working between Defra and BEIS, but to provide that oversight, we also need the Groceries Code Adjudicator. Like the noble Baroness, Lady McIntosh of Pickering, I see a direct link between Amendments 197 and 207. This would ensure that the role of regulating agricultural contracts was given to the Groceries Code Adjudicator. As well as telling us how the regulations will be governed, perhaps the Minister will advise us about ongoing discussions between Defra and BEIS about a possible role for the GCA in this respect. Or perhaps there would be another body. But surely the body that has been tried and tested, and has proved its worth, should be the one.

Photo of Lord Curry of Kirkharle Lord Curry of Kirkharle Crossbench

My Lords, I shall speak to Amendment 197, in the names of the noble Lord, Lord Grantchester, and the noble Baroness, Lady Jones of Whitchurch, and to Amendment 207, in the names of the noble Baroness, Lady McIntosh of Pickering, and others. I very much welcome Clause 27. The Government’s commitment to include fair dealing within supply chains in the Bill is important and much needed.

I speak as someone who established a reasonably successful agricultural co-operative to market livestock, finished beef cattle and lambs, during the 1990s, so I am only too well aware of pressures in food supply chains. I still have the scars. Clause 27 goes into a huge amount of detail on how fair dealing obligations will be applied. That is welcome. For far too long, insufficient information has been available on input costs and benchmarks on which to base sensible modern contractual arrangements.

As has already been said, when pressure is applied to supply chains, the primary producer is, ultimately, the fall guy and the weak link in the chain. The buck stops there. So, however welcome the provision is, I am concerned because, in this part of the Bill, the Government are particularly vague about the location of the administration of the function. Like others who have spoken, I think I understand why. I am aware that the Department for Business, Energy and Industrial Strategy is reluctant to expand the scope of the Groceries Code Adjudicator.

As the noble Lord, Lord Grantchester, and the noble Baronesses, Lady Boycott and Lady McIntosh, have said, under the current chair, Christine Tacon, the office of the adjudicator has been established with huge credibility and influence. It is the logical home for this function, and I would encourage the Minister, in negotiations with his colleagues in BEIS, to persist in trying to achieve that outcome. There is no other logical place, even if we consider the RPA, with the experience for the function to be sited there. A new chair of the Groceries Code Adjudicator will be appointed later this year, when the current chair steps down, and that will present an opportunity to review and expand its remit. I support the amendments.

Photo of Baroness Humphreys Baroness Humphreys Liberal Democrat Lords Spokesperson (Wales)

My Lords, I support Amendment 197, in the name of the noble Lord, Lord Grantchester, and I thank him for his detailed approach in introducing the amendments. This amendment to Clause 27 provides the opportunity to look again at the remit of the Groceries Code Adjudicator, and to examine whether it could be extended to include responsibility for overseeing fair dealing obligations in relation to farmers and producers. More importantly, perhaps, the amendment also provides an opportunity for the Government to explain and expound on their position.

Since the adjudicator’s role was established in 2013, there have been calls from farming unions in Wales and the rest of the UK to address fairness in this part of the supply chain by bringing the sector into her remit. Clause 27 allows the Secretary of State to impose new fair dealing regulations and to provide for enforcing those regulations, and allows

“complaints relating to … non-compliance to be referred to a specified person”— in effect, creating a new body under a new leader.

The Environment, Food and Rural Affairs Committee in the other place recommended that the adjudicator is

“a more logical entity to oversee fair dealing obligations”,

and it could

“see no reason why fairness in the food supply chain should be governed by two separate processes and enforcement bodies.”

In Wales, the Senedd’s Climate Change, Environment and Rural Affairs Committee agreed with the sentiments of the Farmers Union of Wales and the Tenant Farmers Association Cymru, which expressed concern that the Government were not seeking to achieve the desired outcomes of Clause 27 by expanding the role of the adjudicator.

In their response to the EFRA Committee’s report, the Government said that

“no final decisions have been taken about the body that would oversee and enforce the new codes of practice”,

although their positive comments about the potential role of the Rural Payments Agency seemed to point in its direction. The Government do, however, rule out a role for the adjudicator, referring to the call for evidence in 2016-17, when they concluded that they would not extend the adjudicator’s remit to indirect suppliers, because

“there was insufficient evidence of a market failure across the supply chain to justify a major government intervention”.

It appears, however, that circumstances have changed somewhat in the intervening three or four years, and the Government themselves have now recognised that there is now a need for further regulations—hence Clause 27. It seems illogical that the new regulations should lead to the creation of a new body when a person and a body that operate in that field, and have the necessary expertise, already exist.

If, as they say, the Government have not made a final decision, my hope is that in the promised industry consultation they will be open-minded, and that the option of the new role being incorporated into the functions of the adjudicator will be included in that consultation. In the meantime, I would be grateful if the Minister could provide some clarity about the Government’s thinking and tell us, in particular, whether they consider a completely new body to be desirable, and how they view the relative merits of the Rural Payments Agency and the Groceries Code Adjudicator in relation to the new regulations. I support the amendment, and look forward to hearing the Minister’s response.

Photo of Lord Bruce of Bennachie Lord Bruce of Bennachie Liberal Democrat Lords Spokesperson (Scotland), Liberal Democrat Spokesperson (Northern Ireland)

My Lords, I also wish to support Amendments 197, 198, 199 and 207. The Minister will now be aware that there is strong support right across the Chamber for the role of the Groceries Code Adjudicator to be sustained and strengthened. Indeed, the evidence has shown how effective the adjudicator has been since it was established.

I make no apology for recording the fact that that Act was passed by the coalition Government and was very strongly championed by the Liberal Democrats Colin Breed, Andrew George, Ed Davey and Norman Lamb. They have been vindicated in the effectiveness that the adjudicator has demonstrated. Her latest annual report shows a refreshing drop in the proportion of suppliers who have issues with retailers, from 79% in 2014 to 41% in 2019, and 36% so far in 2020—although that suggests that there may have been an upturn, given that it is a part year, and I predict that that will intensify with Brexit and the consequences of Covid-19. It is still high, and I suspect that there is still a need for indirect representation as well.

All of us want to thank the outgoing Groceries Code Adjudicator, Christine Tacon, for what she has achieved and her vindication of the role. We appreciate that she has stayed on in the current crisis, and trust that her successor will be given the opportunity to continue and develop the good work. I suggest that, at this time, the office may be needed more than ever. The disruption we are currently facing, which will be compounded by Brexit, will put pressure on the margins of suppliers and retailers—inevitably.

If there is a spike in the price of any home-grown food products, retailers will want a piece of it. Of course, that is normal market behaviour, but it makes the case for there to be an independent adjudicator with real strength and teeth that are stronger than ever. For example, if there is a price rise because of increases in import costs or wastage as a result of delays in transit, retailers may pressurise suppliers who could fill the gap. This is all the more reason why UK growers and suppliers should not be squeezed out of a market by an internal excessive squeeze on their margins. Over the next six months, we face unprecedented pressures on the supply chain, which mean unprecedented pressures on our home-growing capacity and on the retailers, whose margins could be under pressure from consumers who are resisting price rises.

I urge the Minister to recognise the strength of feeling across the Chamber and to recognise that the adjudicator has proved to be very effective and is absolutely the right body, and more important than ever, to be given the role of defending suppliers in this very fraught forthcoming situation. I am very pleased to support the amendments.

Photo of Viscount Trenchard Viscount Trenchard Conservative

My Lords, the noble Baroness, Lady Bennett, is very keen that we should allow fungi to be recognised as a separate group within the kingdom of living things on earth. We have obviously moved on from “animal, vegetable or mineral?”, a game which I think many noble Lords will have played as children on long car journeys. I am not sure that we cannot still include fungi within a definition of plants, because it would keep the drafting simpler, and I am not sure that there is any clause of the Bill where fungi will need separate and different references from plants.

My noble friend Lord Caithness is right in his Amendments 177, 179, 180 and 182, which would restrict the powers with regard to data collection to the purposes contained in Clause 23. I also sympathise with his Amendments 186 and 187, which would restrict the definition of “a closely connected person” and the extent of the data which may be collected, and I ask the Minister to give a clear response on these points.

My noble friend Lord Lucas, in Amendments 178 and 181, seeks to provide that the data collection’s purposes should be widened to include the duty to report to Parliament under Clause 17. I ask my noble friend the Minister whether he thinks there could be confidentiality issues here to protect members of supply chains, which are important. Amendment 183 seeks to include “plants”, but surely they are included in

“or other thing taken from the wild.”

I support Amendment 191 from my noble friend Lord Caithness, which seeks to release participants in supply chains both from the provision of unduly burdensome information and from a perceived requirement to disclose confidential information, which is very necessary. Amendment 192 seeks to include intellectual property rights, but surely they are already included.

I am not sure how many of the amendments in this group from the noble Lord, Lord Grantchester, are necessary. With regard to Amendment 195D, I thought there was always an implied contract if there is a deal, but I would appreciate my noble friend the Minister’s confirmation of that. If I am right, the word “contractual” is otiose in Clause 27(2), which would make Amendment 195E unnecessary.

I cannot support Amendments 196 and 201 in the name of the noble Baroness, Lady Jones of Moulsecoomb, because product quality is not necessarily affected by animal welfare standards. Also, producer organisations are of course required to observe the high animal welfare standards that the law rightly requires.

I am interested in the suggestion made by the noble Lord, Lord Grantchester, in Amendments 197 to 200, which seek to widen the responsibilities of the Groceries Code Adjudicator to ensure fair dealing. My noble friend Lady McIntosh makes the same suggestion in her Amendment 207. I would have thought that the skills required are comparable and that it should not be too difficult to recruit some agricultural specialists to the adjudicator’s office. Indeed, would that not be better than setting up yet another quango to deal with this matter?

Sitting suspended.

Photo of Baroness Bakewell of Hardington Mandeville Baroness Bakewell of Hardington Mandeville Liberal Democrat Lords Spokesperson (Environment, Food and Rural Affairs) 6:35 pm, 16th July 2020

My Lords, this group of 44 amendments covers a wide range of topics. The noble Baroness, Lady Jones of Moulsecoomb, has said that it is a mixed bag. Amendments 90, 188 and 189 and others deal with adding “fungi” to the financial assistance list. The noble Baronesses, Lady Bennett of Manor Castle and Lady Boycott, have spoken to these amendments and given us a list of the benefits of fungi.

Amendments 177 to 187 relate to data sharing. Amendment 190 would increase the purposes for which information may be processed to include to assist transparency and to prevent waste in the agri supply chain. Amendments 191 to 194 seek to reduce the burden on those who have to provide the information, and set out intellectual property rights and require that penalties should be proportionate. The noble Lord, Lord Grantchester, has Amendments 195A to 195F, which would add safeguards for all sectors to be consulted. Fair contractual dealing is specified and liability for unforeseen events would be limited.

Amendments 197 to 200 would make provision for the Groceries Code Adjudicator’s office to regulate contracts, and Amendment 207, to which I have added my name, seeks to make provision for the Groceries Code Adjudicator to be responsible for compliance with Part 3. The noble Lord, Lord Empey, spoke eloquently about the importance of fairness and transparency for those at the bottom of the food supply chain. The Bill includes provisions for fair dealing to be implemented. However, it is vague about where that is to be monitored. I fully support the noble Lord, Lord Grantchester, and all those who have spoken in their attempt to provide fair dealing across buyers and sellers in contracts and to provide clarity about how that will be achieved.

The noble Baroness, Lady McIntosh of Pickering, spoke passionately about the importance of the Groceries Code Adjudicator in advising and enforcing the provisions of the Bill. The adjudicator has the expertise, knowledge and experience to bring reassurance to small producers. The noble Baroness, Lady Ritchie of Downpatrick, gave examples of how the adjudicator can provide the best possible role in monitoring parts of the Bill. That view is supported by the noble Lord, Lord Curry of Kirkharle. My noble friend Lady Humphreys asked that the Groceries Code Adjudicator be expanded to include farmers and growers and for clarity on whether a new body is needed. My noble friend Lord Bruce of Bennachie also supported the involvement of the Groceries Code Adjudicator and gave statistics on how effective it has been in the supply chain.

The noble Baroness, Lady Jones of Moulsecoomb, spoke to Amendments 201 to 206 on animal welfare, and the noble Lord, Lord Carrington, spoke to Amendments 202 to 205 relating to retaining EU competition law.

The Minister is always very assiduous in his responses to our debates, and even given a list of 44 amendments I am sure he will give us something to think about. I look forward to hearing his answers to the many points raised.

Photo of Lord Grantchester Lord Grantchester Opposition Whip (Lords), Shadow Spokesperson (Energy and Climate Change), Shadow Minister (Environment, Food and Rural Affairs), Shadow Spokesperson (Business, Energy and Industrial Strategy)

I thank all noble Lords who have come forward with amendments and support; this is a daunting group of 44 amendments covering Part 3 of the Bill, Chapters 1 to 3, plus parts of Schedules 2, 5 and 6. It covers provisions on aspects of the agri-food supply chain; that is, the requirement to provide data and purposes for which data is provided, as well as enforcement of data requirements in Chapter 1. I have mentioned facets of fair dealing in Chapter 2, and Chapter 3 covers producer organisations and competition provisions.

Many amendments appear quite technical in effect; I applaud the assiduousness with which noble Lords have scrutinised these clauses. I welcome the provisions to make producer organisations more effective in legislation under the fair dealing provisions following their recognition under Clause 28. Regarding “competition exemptions” in Clause 29, can the Minister tell us whether the experiences of the Covid-19 pandemic caused any rethinking of the clause in the application of the Competition Act 1998? Given the opportunity to bring forward regulations in due course, with the consultations normally undertaken in that process, he may be able to confirm that the flexibilities around the framework are sufficient.

The importance of information and the collection of data in the supply chain has long been recognised. I thank the noble Lords who have pursued this in relation to how it is used with recognition of data protection legislation, to improve supply chain transparency and manage volatility. They have asked the Minister to clarify that the drafting of these powers will achieve this. I shall listen carefully to all the Minister’s responses to these amendments.

Photo of Lord Gardiner of Kimble Lord Gardiner of Kimble The Parliamentary Under-Secretary of State for Environment, Food and Rural Affairs, The Parliamentary Under-Secretary of State for Environment, Food and Rural Affairs

My Lords, this has been an interesting debate taking us through a range of issues. I thank the noble Baroness, Lady Bennett of Manor Castle, for tabling amendments relating to fungi. I listened to what the noble Baronesses, Lady Jones of Moulsecoomb and Lady Boycott, said on the matter. I declare my farming interests as set out in the register.

Clause 1(5)(b) already includes the conservation of fungi as conserving can relate to the restoring or enhancement of a habitat. In instances where it may be desirable to conserve wild fungi, or a rare species of fungi, this is possible through the power to conserve the habitat in which they exist. In Clause 22(6) and under Schedules 5 and 6, the definition of “agriculture” already includes fungi. In relation to Amendment 183, I assure my noble friend Lord Lucas that the current drafting includes wild plants, as well as wider aspects of farm-to-fork activity to be collected.

I turn to Amendments 177, 179, 180, 187, 191 and 192 on data collection. Some of the issues have been quite technical in this part of the Bill. I will endeavour to answer as many questions as possible but some might, perhaps, involve a more detailed response; I shall reply in writing on any outstanding points. The Government have taken deliberate steps to ensure that only information which fulfils a clear purpose can be collected. I agree with my noble friend Lord Caithness that this needs to be focused and proportionate—a point also made by my noble friend Lord Trenchard.

An exhaustive list of purposes is contained under Clause 23; the requirements for information must fulfil one of those defined purposes. Clause 24 sets out that, before an information requirement can be issued, the Secretary of State must publish a draft requirement and invite views over a four-week period from anybody who will be affected by it. Any views, including those about difficulties in meeting the requirements, will be considered by the Government before final publication. Clause 25(9) already ensures that, in circumstances where a proposal is made to disclose information in an anonymised form, consideration must be taken of how such a disclosure would affect commercial interests, including intellectual property rights. As regards information provided under a duty of confidence, a blanket provision would be inappropriate given that a duty of confidence could easily be established via a discretionary agreement between any two parties simply for the purpose of avoiding information requirements.

At Clause 21(5), the Bill includes safeguards to protect information subject to legal privilege. Clause 46(2) sets out that these powers cannot be used in ways that would contravene existing data protection legislation. The Government therefore believe that these safeguards are sufficient.

Amendment 193 seeks to extend enforcement provisions to cover the individuals handling any data collected. Clause 26 exists specifically to create a means of investigating and dealing with a refusal to provide information. Once information has been collected, it is already protected by existing data protection legislation, and therefore the Government do not believe that further enforcement powers are required.

I should also say to my noble friend Lord Caithness that the Government held a series of discussions with industry stakeholders, including the NFU and the AHDB, to establish the current datasets available for agricultural markets and to identify where further information could improve supply chain transparency.

On Amendments 178, 181 and 182, the data required for the food security report is already available and will be drawn from a blend of national and international sources, such as the Office for National Statistics and the Food and Agriculture Organization of the United Nations. Clause 25(5) allows a requirement to specify that information is provided to a person other than the Secretary of State. This may include non-departmental public bodies and arm’s-length bodies, among others. However, it is important that the Secretary of State retains control over, and responsibility for, how these powers are used.

Amendments 185 and 186 seek to expand the definition of those related to the agri-food chain. The power already allows for information to be collected from anyone capable of affecting the agri-food supply chain. This drafting language was selected specifically with businesses such as hauliers and farm business suppliers in mind, as well as other relevant operators in the supply chain. In order to assess animal disease and wider risk-management tools effectively, the Secretary of State must have access to a broad range of data. It would hinder that aim if the definition of those closely connected to the agri-food chain applied only to those negatively affecting certain aspects. In addition, the Food Standards Agency has robust and relevant powers in this area, and Defra and the FSA will continue to work together when needed.

Amendment 190 concerns the purposes for which data can be collected. The list of purposes contained in Clause 23 was drawn up after careful and detailed consideration with industry stakeholders. The purposes are drafted so that they can serve both current and future policy ambitions. We believe that narrowing the powers in the manner suggested would mean that auxiliary supply chain operators who hold crucial information, such as vets, contractors, fertiliser merchants and others, would be exempt from information requirements.

Amendment 194 concerns monetary penalties. Clause 26(5) specifies that financial penalties are to be calculated in a “specified manner” and clarifies that this means

“framed by reference to … profits, income or turnover.”

Issuing the same penalty to a farmer and a supermarket would clearly be inappropriate.

Amendments 195 and 195A concern the fair-dealing provisions in Clause 27. The introduction of contractual obligations across the whole of UK agriculture would, we believe, lead to provisions that fail to address the specific—I underline “specific”—problems of some sectors and introduce unnecessary bureaucracy in others.

The Government believe that each agricultural sector is different, that a targeted approach for each sector is most appropriate and that industry should be invited to provide its views. As such, an obligation to make regulations within 12 months of the Bill receiving Royal Assent may undermine the ability to undertake this necessary engagement. Indeed, on 24 June, a UK-wide consultation to explore contractual issues in the dairy sector was published. This consultation invites a broad range of views about future regulations and the most effective form of dispute resolution enforcement. The Government encourage all relevant farmers and processors to submit their response to this consultation and will actively listen to their views on appropriate enforcement mechanisms. The Government intend to repeat this approach for any future exercise of the powers within Clause 27, allowing feedback from industry to inform the final decisions made.

Amendments 195B to 195F and Amendment 196 seek to make changes to the approach adopted in Clause 27. The Government have designed this clause to be as flexible as possible, so that any obligations introduced under it can deliver appropriate protection. Following feedback from stakeholders on the Agriculture Bill 2018, for instance, the Government removed the link to the list of sectors in Schedule 1. The ability to account for the differences found between sectors is, we believe, important. For instance, while the dairy sector typically operates using formal written contracts, in the livestock sector and parts of the arable world, informal, word-of-mouth arrangements are more common. The Bill has the flexibility to regulate both kinds of relationships. With particular reference to Amendments 195F and 196, Clause 27(7) is a non-exhaustive list of obligations which may be introduced under this clause. Where obligations are required which create a more balanced risk profile, or which deal with matters of animal welfare, the current drafting allows for this.

On Amendments 197, 198, 199, 200 and 207, I endorse all the points that noble Lords made about the work of the Groceries Code Adjudicator and all those who have been involved. This was created for the specific task of monitoring relationships between the UK’s largest supermarkets and their direct suppliers. This targeted focus and a good understanding of how the retail market works have proved critical in delivering effective change—a point made by the noble Lord, Lord Empey.

I say to the noble Baroness, Lady Ritchie of Downpatrick, that Defra and BEIS officials work very closely together on matters that affect the supply chain. BEIS and Defra together issued the call for evidence on extending the Groceries Code Adjudicator’s remit in 2016. A government call for evidence in 2016 on the GCA’s remit found insufficient evidence to justify extending it to indirect suppliers. I say in particular to the noble Baroness, Lady Humphreys, that the issues identified by the review were sector-specific, were predominantly concerned with the first stage of the supply chain and are best addressed with the targeted interventions in the Bill.

In response to my noble friend Lady McIntosh, I think, and the Government think, that the views of the farming industry will be critical in shaping these interventions. The Government’s current consultation invites responses about an appropriate enforcement regime. Having heard from many noble Lords around the House, I will make sure that the remarks that have been made across the House will also be fed into the department, and these will, of course, be considered before decisions are made.

In relation to statutory codes, I say to the noble Lord, Lord Empey, that the specific detail of each statutory code will be developed in consultation with industry and set out in secondary legislation. The codes will introduce obligations that businesses need to abide by when entering into a contract to buy agricultural products directly from qualifying sellers. I have more on that, and again my letter will set out more detail.

The noble Lord, Lord Grantchester, asked about the government department responsible for future codes of conduct and their enforcement. Codes of conduct introduced under the Bill are designed to protect farmers and growers. It is therefore envisaged that Defra will be the lead department responsible for managing the relationship with any future enforcement body regarding the codes introduced under Clause 27.

The noble Lord, Lord Grantchester, also asked about powers being used in a crisis. The problems experienced by sectors such as dairy during the recent Covid-19 pandemic were wider than just contractual practice. We will carry out sector-specific consultations, gathering views on which contractual measures would improve the resilience of the industry should similar situations arise in future. This will be undertaken through regulations. It could come under matters specified in Clause 27(7), for instance.

Amendment 201 relates to the recognition of producer organisations. Introducing into primary legislation extra conditions such as the one proposed risks placing further burdens on businesses interested in greater collaboration. We believe that in the livestock sector, where collaborative business models are likely to be comparatively small, a mandatory requirement to appoint a responsible officer for animal welfare would be disproportionately bureaucratic. But before the noble Baroness, Lady Jones of Moulsecoomb, becomes too disappointed, the kinds of specific conditions she is concerned with in Amendment 206 are most appropriately dealt with in regulations, in our view, rather than in the Bill. This will allow for consultation, during which animal welfare groups will be invited to express their views.

Amendment 202 seeks to remove the obligation to publish online a decision to recognise a producer organisation. I would like to reassure the noble Lord, Lord Carrington, that this is simply the continuation of an existing practice. No sensitive information pertaining to the producer organisation is published. A list of the names of active UK producer organisations is already available on the government website, and this will continue.

I found Amendment 203 quite technical. I looked at the amendment and the Bill and am happy to say that I will study any further follow-ups with even greater intensity. This amendment would preserve some elements of existing European Union law. The Government do not think it appropriate. The UK is leaving the CAP and should pursue its own objectives via domestic agriculture. Furthermore, we believe that preserving an element of EU law that is being replaced by a domestic equivalent, a new system of producer organisation recognition, could create confusion about how recognition is secured. As I said, if there is a more technical discussion to be had, I am happy to have it.

There was a question about why we had removed the agricultural exemption. We are not removing the agricultural exemption but amending it so that, in order to benefit from the exemption, the provisions of our domestic producer organisation regime must be complied with, instead of the objectives of the CAP, which I think responds to that point but in a slightly different phraseology.

Amendments 204 and 205 seek to remove the oversight role of the Competition and Markets Authority. I entirely appreciate the sentiment behind these amendments. The Government are committed to creating a simpler and less bureaucratic regime than the current EU one. However, the CMA is the expert authority on competition law in this country and it is right and proper that, where derogations from competition law are concerned, it retains the ability to provide its expertise.

Because of the range of issues discussed in this group, I will certainly look at Hansard, as I said, and see if there are any more technical points. I know the noble Lord, Lord Grantchester, has asked some technical questions and it might be helpful if I set out in my more detailed letter how we perceive the workings of Clause 27.

As I said, work is in hand. I know that that is frustrating for noble Lords who want certainty, but the consultation will be first with dairy and then the other sectors. We are doing this because we recognise that we need to find the right way forward to ensure that the fair dealing provisions actually work for the farmer and the producer. If we fly into something and find that we are not working with the farming sector to achieve what is best, we will have missed a great opportunity.

I understand the point—the Groceries Code Adjudicator has worked very well, but my understanding is that the farming industry itself was not keen to have the adjudicator come in to deal with those situations. There is a feeling that the sector-specific arrangements will, in the end, suit the farmer and the producer better, and probably make it more accessible and nearer to the farm, as it were.

If there are any outstanding points, which I fear there may be, I will respond in writing, but I want to point out that fungi are an aspect of our ecosystem that is clearly important to our wildlife habitats and to the production of food. Given the reassurances about Clause 1 and Clause 22, I hope that the noble Baroness, Lady Bennett of Manor Castle, will feel able to withdraw her amendment.

Photo of Baroness Scott of Needham Market Baroness Scott of Needham Market Liberal Democrat 7:00 pm, 16th July 2020

My Lords, in 2016, I chaired an EU sub-committee inquiry into building a more resilient agricultural sector. We took evidence on the financial impact on farmers of a number of supermarket contractual practices. One was overzealous specification, which could result in the destruction of up to 20% of some crops. The other was that because of such swingeing penalties for under-provision, farmers had to grow far more than they needed. Noble Lords may come on to this issue when we debate food waste in later groups of amendments, but I wanted to raise it this evening with regard to the role of the Groceries Code Adjudicator, because no one else has. I hope the Minister will consider it in the list of items relating to fair dealing, to which I know he will be giving a lot of thought.

Photo of Lord Gardiner of Kimble Lord Gardiner of Kimble The Parliamentary Under-Secretary of State for Environment, Food and Rural Affairs, The Parliamentary Under-Secretary of State for Environment, Food and Rural Affairs

I am grateful to the noble Baroness. We are bringing forward these provisions in the Bill because we recognise that the current situation is far from satisfactory. We need to consult the sector on fair dealing provisions. We started with the dairy sector, but that is the beginning; we need to consult each and every sector so that we get the right response and find out how they are most directly affected by what I would call unfair arrangements. When we have reached a view with them, we can rectify any problems and find a way of enforcing the provisions. Regarding the consultation, it is a question of making this work for the farmer. Like everything else in this Bill, if this does not command the consent and support of the farmer, we will not have done a good job.

Photo of Lord Hope of Craighead Lord Hope of Craighead Chair, High Speed Rail (West Midlands - Crewe) Bill Select Committee (Lords), Chair, High Speed Rail (West Midlands - Crewe) Bill Select Committee (Lords)

My Lords, I want to take the Minister back to Amendment 90 in the name of the noble Baroness, Lady Bennett of Manor Castle, and the important issue of fungi and the meaning of the word “plants”. I absolutely understand the noble Baroness’s wish for scientific accuracy, and I understand the points forcefully made in support of the amendment of the noble Baroness, Lady Boycott. But I wonder if the Minister agrees that, at the end of the day, it comes down to the ordinary meaning of words, as indeed it did in the case of Amendment 87 in the name of the noble Lord, Lord Trees, on the question of whether the word “processing” included slaughtering. The Minister said that it did, and I agree.

Perhaps the Minister will take comfort from the meaning of “fungus” in the Concise Oxford English Dictionary. As a lawyer, when it comes to the ordinary meaning of words, I tend to look in the dictionary. It defines “fungus” as a

“mushroom, toadstool or allied plant, including moulds.”

It goes on to give a botanical definition: a

“cryptogamous plant without chlorophyll feeding on organic matter.”

So far as the dictionary is concerned, plants include fungi. With the benefit of that definition, I wonder whether the Minister would be prepared to say that wherever the word “plants” is used in the Bill, it includes fungi.

Photo of Lord Gardiner of Kimble Lord Gardiner of Kimble The Parliamentary Under-Secretary of State for Environment, Food and Rural Affairs, The Parliamentary Under-Secretary of State for Environment, Food and Rural Affairs

My Lords, I wish that the noble and learned Lord had given me those definitions before I replied, because it would have helped the noble Baroness even further.

On our definition, I specifically mentioned Clause 22(6) and the schedules that contain “fungi”. As I said, I can confirm that in Clause 1, which is about wild fungi and habitat, “fungi” covers plants and fungi, as it does throughout the Bill. My lawyers’ interpretation is that fungi are included.

Photo of Baroness Bennett of Manor Castle Baroness Bennett of Manor Castle Green

I thank the Minister for his usual comprehensive and precise response to what is, as noble Lords have reflected, a hugely diverse range of amendments.

I do not intend to attempt to sum them all up, but I want to respond specifically to the noble and learned Lord who just intervened. My academic background is as a scientist. If the law can be scientifically accurate, reflecting modern understanding, many people might think that that is a good thing. I hope that the Minister will go away and talk to his officials and perhaps reflect on how many scientists there are in the Bill drafting team.

As the noble Lord, Lord Lucas, said in his interesting intervention, this is an issue of accurate language. As a feminist, I might come back to the other issues he raised with regard to the House another time, but not today.

I thank the noble Baroness, Lady Boycott, and the noble Earl, Lord Dundee, for their support. Reflecting briefly on the animal welfare provisions, some of which were supported by my noble friend Lady Jones of Moulsecoomb, the noble Baroness, Lady Boycott, came up with an interesting proposal in suggesting that there could be an animal welfare oversight body—something like the Groceries Code Adjudicator. Perhaps we can take that away and look at it in future.

I welcome the Minister’s commitment to close consultation with groups concerned with animal welfare in the regulations. I am sure that we look forward to seeing that, but most of the amendments in this group relate in some way or another to fair dealing and the problem of our current distribution system. The noble Lord, Lord Grantchester, was hugely powerful when he talked about how the supermarkets making massive profits from the current tragic situation bore down on smaller suppliers and producers. The noble Baroness, Lady McIntosh of Pickering, stressed how we need joined-up thinking in ensuring fair dealing. I welcome what the Minister said about consulting the farming and growing sector in this area.

That sums up where we are. We have all done a great deal of work. Perhaps we will come back to some of this but, in the meantime, I beg leave to withdraw the amendment.

Amendment 90 withdrawn.

Amendments 91 to 102 not moved.

Clause 1 agreed.

Amendments 103 and 104 not moved.

Photo of Lord McNicol of West Kilbride Lord McNicol of West Kilbride Deputy Chairman of Committees

We now come to the group beginning with Amendment 105. I remind noble Lords that anyone wishing to speak after the Minister should email the clerk during the debate. Anyone wishing to press this, or any other, amendment in this group to a Division should make that clear in the debate.