I welcome you to the Chair, Mr. Gale, for this debate on the Kentish fruit industry, about which you no doubt know a great deal. I also welcome the Minister and thank him for taking the time to respond to this short debate.
By way of introduction, let me say that I represent what I believe is the only remaining constituency in Britain in which fruit farming is the predominant type of agriculture. The county of Kent owes its reputation as the garden of England to that industry. I made my maiden speech on the subject in July 2001, when the Minister and I entered the House together, and since then I have served as secretary of the all-party group on the fruit industry. I asked for this debate, in the tradition of Westminster Hall, on behalf of my constituents, but it deals with concerns affecting the entire fruit sector.
Why is the seasonal agricultural workers scheme so important? To put it bluntly, without labour there is no means of picking the fruit that we grow. Labour accounts for between 40 and 60 per cent. of a fruit farmer's cost base and almost all the labour comes through SAWS. It follows that if the scheme is restricted in any way, the UK fruit industry will collapse. That will have enormous consequences for the wider local economy because there are jobs all over Kent in transport and marketing related to the fruit industry and in tourism. It will have enormous consequences for the environment, both locally, where orchards will be grubbed up, and nationally and internationally as alternative produce is sourced from abroad. It will have considerable consequences for Government policy, as well. The Government have launched schemes such as the healthy eating initiative, the five-a-day scheme and the fruit for schools scheme. Finally, it will have consequences for SAWS students, who benefit enormously financially and from the knowledge and experience that they gain of living and working in Britain. Almost none of them abscond at the end of the scheme.
This debate takes place against a backdrop of a Home Office review and I believe that a decision is due at the end of January. My aim this morning is to convince the Minister of three key points, the first of which is that fruit farming needs to be encouraged. It is important for the local economy, it produces high-quality produce close to the marketplace that is vital to a healthier diet and so on, and it is good for the environment. It deserves our support. Secondly—this is crucial—SAWS is not an immigration or asylum issue and should not be confused with either. Finally, SAWS is a welcome success story. It is a well managed and trouble-free scheme, which brings enormous benefits to the United Kingdom and, critically, to the students who participate in it. It needs to be encouraged and improved in the years ahead.
SAWS was set up after world war two to encourage European workers to take up short-term employment in agriculture and horticulture. It has always been aimed primarily at students at agricultural colleges or who have experience of the agricultural sector. In 2004, 25,000 students from outside the EU visited the UK to work on our farms and to learn our language and about our culture. Sadly, that number was reduced to only 16,000 in 2005 and the future of the scheme is now being reviewed as the Home Office launches a five-year plan to simplify the immigration system. The concern felt by many of my fruit farmers is that some people in government believe that the recent enlargement of the EU will provide a sufficient pool of low-skilled labour to replace SAWS students. That is emphatically not the case for the following five reasons.
First, SAWS is a well established and successful scheme. The model of students visiting the UK and gaining work experience and understanding of Britain has worked well for more than 40 years. SAWS is well managed, all operators are licensed by the Home Office and all participating farms are carefully monitored. The Home Office administers the scheme without difficulty and there is a simple fee to cover the costs. The fact that all the participants are students means that they have to return to their own country to complete their studies at the end of their time here. A parliamentary written answer tabled recently revealed that less than 1 per cent. of SAWS students ever abscond, so the scheme does not present any threat to immigration and asylum policy.
Secondly, there is a proven need for exactly that type of temporary labour force. Quite apart from what I said about the need to encourage fruit farming, the Government recognise the importance of the scheme. In 2002, the Home Office White Paper on managed migration, "Secure Borders, Safe Haven: Integration with Diversity in Modern Britain", stated:
"There is a clear need for short-term casual labour. Although this comprises only a small proportion of all employment in the UK, it is important in industries such as agriculture. We will look again at the operation of the long-standing Seasonal Agricultural Workers' Scheme (SAWS) to see how it might better meet the needs of the agricultural sector. We will build on its principles to meet the demand for short-term casual labour in other sectors of the United Kingdom economy."
A couple of years ago, the Curry report recommended that the number of places on the scheme be increased to 50,000—double the peak of 25,000 in 2004. The White Paper suggests a mechanism for any sector to prove the need for labour, entirely based on SAWS. SAWS is popular with farmers and workers alike. Demand from UK farmers for reliable, well motivated SAWS students continues unabated and applications from students wishing to participate in the scheme outstrip demand by a ratio of 2:1. In short, there is a proven need among UK farmers and the students for SAWS to continue in Government policy.
Thirdly, developments in the EU labour market will increase the pressure on UK farmers and reinforce the need for SAWS. France, Germany and Italy have imposed restrictions on workers from the accession countries that are due to be lifted by 2007; indeed, by 2011 all restrictions of any sort will be lifted. Given that by then the UK is likely to be less favoured than some other EU countries as a work destination, due to its climate, geographical isolation and the resulting higher travel costs, it is premature to conclude that workers from the A8 accession countries will fill the demand presented by SAWS. We need to retain SAWS until we are sure that our agricultural labour requirements can be met by other means. My view is that they never will be.
Fourthly, it is most unlikely that EU workers will fill the void. Workers from elsewhere inside the EU want permanent jobs rather than the seasonal ones available in agriculture, and they will quickly move on to better paid opportunities here or in their own countries as their economies improve. If the Minister doubts that, he should consider the present lack of UK students working on farms during the summer vacation compared with 20 years ago, when I was at university. Most UK students would greatly prefer to work in, for example, the hospitality industry, and workers from other EU countries replicate that pattern precisely. In short, workers from the other EU countries cannot fill the void that is currently filled by SAWS students.
Fifthly and finally, the cultural and educational elements of the SAWS scheme set it apart from immigration and asylum issues. It is a remarkable testament to the success of the scheme that the Polish Agriculture Minister, Mr. Kowalski, is a former SAWS student. The experience gained by students in production technology, food and retailing plays an important part in helping their own economies when they return home. Furthermore, while they are here they benefit the local economy in the UK, as many local shops and pubs know well. Some students even earn enough money while they are here to buy their own land and set themselves up when they return home. One student I met two summers ago on a farm in my constituency had been coming here for three years while doing his medical studies and reckoned that if he returned for a further two years he would be able to pay off the mortgage on his flat in Belgrade.
In conclusion, I hope that I have convinced the Minister of the three key points that I set out at the start of my speech. First, fruit farming deserves our support. It produces high-quality produce, which accords with Government policy on healthy eating; it produces it close to the marketplace and it is good for the environment, particularly in areas such as the garden of England. However, the sector is under extreme pressure: costs are rising for farmers, which is set against the downward pressure on prices exerted by the supermarkets, while the demand for land in the south-east is growing fast. The availability of a capable seasonal labour force is a key issue. Without it, many fruit farms will sadly fold. Secondly—the key point—SAWS is not an asylum and immigration issue. It is a means for students from non-EU countries to visit Britain for up to six months and then return home. It has nothing to do with the immigration and asylum issues that cause so much public and political concern. Thirdly and finally, SAWS is a success story. Less than 1 per cent. of SAWS students ever abscond; the majority return home enriched by their experience of Britain and considerably wealthier. Put simply, there are no losers.
It is apparent to me that SAWS has an obvious home in tier 4 of the new system proposed in the Home Office White Paper. Can the Minister reassure my constituents and the wider fruit sector that he understands the issue and is able to make the necessary recommendations and representations inside his Department?
I congratulate Hugh Robertson on securing the debate. He is right to say that the fruit sector is important to our economy. I believe that the whole country is indebted to his constituency for the vast amount of fine produce that emerges from it. I am unsure how many people on the SAWS scheme are involved in hop picking, but if they are I certainly pay tribute to the fruits of their labour.
The hon. Gentleman is also right to say that the industry depends upon seasonal labour and is under pressure. We all know from the debate we see in the media that pressure is being exerted on agricultural producers in this country by price competition among supermarkets. Although that has been good for consumers in that the prices they pay have come down, it has made the pressure on domestic agriculture more severe. While celebrating the lower prices, we must understand what that equation means. He is also right to say that we would like local produce to be used in schools in pursuit of the five-a-day initiative. We would all want to unite behind that; I am pleased that he made reference to it.
I listened carefully to the three key points that the hon. Gentleman outlined and the arguments that he used to substantiate them. I agree with two of the three and disagree with one, but that is not to say that there is an unbridgeable gulf between us. I hope that he will find some cause for comfort at the end of my remarks.
The hon. Gentleman's first point was that the industry deserves support. As I have said, I agree. There is a long tradition of fruit farming in his part of the world. We obviously listen to the industry's concerns, to ensure that it is supported and that the people who depend on it can continue to do so. Of course, the industry is operating in a changed market. I picked strawberries in my youth, between A-levels and university, and it is certainly not glamorous work. Such work is not on the increase among the domestic work force, so I understand that there are pressures on the industry. Since the economy has expanded in different ways, people have alternative ways to make money. We have to understand how the industry operates in a changed environment and we have to provide support.
I agree with the hon. Gentleman's third point, that SAWS has been well managed and is a success. In some senses it is a win, win scheme. SAWS has been successful and has provided great benefit to those who have taken part in it and to our domestic agricultural industry over a number of years. He is right about that.
I disagree with the hon. Gentleman's second point, however. He says that SAWS is not an asylum or immigration issue. True, it is not an asylum issue, but it is an immigration issue. That is why I am answering the debate today. I respect his point about the cultural exchange elements of the scheme; none the less, SAWS deals with people coming to this country to work. That makes it an immigration issue and we have to consider it as such within the broader context of the Government's immigration policy. I shall discuss how that context is changing and how SAWS is affected.
The hon. Gentleman made the reference himself, but let me emphasise that the debate takes place against the backdrop of the development of a points-based system for managed migration, the consultation on which finished last year. The Home Office has consulted extensively with industry on developing the new scheme. Our aim is to move away from myriad, complicated niche schemes for immigration towards a much clearer, transparent scheme, where the public can have clear information about who is allowed into this country and why. The points-based system is not about letting fewer people or more people in; it is about letting enough people in to help the economy of this country at any given time and, in so doing, allowing the public to see clearly the reasons why people have been allowed to enter. Central to the rationale for the points-based scheme is that it is not intended to run at the same time as the range of niche schemes, such as SAWS and the working holidaymakers scheme. The whole point is to move to a more transparent system. That is the basis of today's debate.
The Government's five-year strategy on asylum and immigration stated that existing, quota-based, low-skilled migration schemes would be phased out over time. As I have said before, the basis of the decision in relation to SAWS is not that we think the scheme is flawed—on the contrary, SAWS has been successful. What we question is whether it is still required, given that the expansion of the European Union has given growers access to a larger pool of workers who are free and, on the evidence, willing to meet seasonal labour needs in the agricultural sector.
In July 2005 the Government published a consultation document, "Selective Admission: Making Migration Work for Britain", which set out in more detail our proposals for a new system to regulate economic migration. Stakeholders in the agricultural sector have been fully involved in the consultation process. I hope that the hon. Gentleman recognises that there has been detailed discussion with companies throughout the country, including in his own constituency. We are considering the responses to that document and we will publish our response, including what we intend in relation to SAWS, in due course. I am not in a position today to state precisely what we intend to do in relation to SAWS, but I will go through some of the issues that are shaping our thinking.
In 2003 nationals of countries that have since acceded to the European Union accounted for 60 per cent. of the 20,430 workers admitted under the scheme in that year. Romania and Bulgaria, which should accede to the European Union in the near future, accounted for a further 12 per cent. In 2004 we decided to cut the SAWS quota from 25,000 to 16,250 in the light of levels of take-up of the scheme by nationals of the accession states. Since their accession, nationals of the new member states have taken up employment in the agricultural sector in significant numbers. Since 1 May 2004, some 36,621 nationals from the eight accession countries have registered as employed in the agricultural sector under the worker registration scheme. The distribution of applications suggest that many are coming to do seasonal work. I can tell the hon. Gentleman that in the second quarter of 2005 there were 9,283 registrations, compared with 3,996 in the first quarter. That suggests that the expansion of the European Union and granting the nationals of the eight accession countries access to our labour markets has resulted in people continuing to come to do agricultural work.
I entirely accept what the Minister says, and I thank him for his earlier remarks. The problem, as many farmers will tell him, is that many students from the EU come to work for farmers at first, but quickly move on to other jobs in the UK economy—they go to work in the hospitality industry, for example. In contrast, people who come to the country under SAWS can work only in the agricultural sector. They come, work on the farms for six months, and go back to their home countries, whereas those from inside the EU work on the farm for a month or so, then quickly get a better paid and more comfortable job in the local pub, for all the reasons to do with strawberry picking that the Minister mentioned. The retention of students from inside the EU is very small indeed.
I understand, and I take that point on board. I can understand the attractions for the agricultural sector of a scheme that is tied in that way. The figures that I gave suggest that people are coming to work in the agricultural sector. I know that the hon. Gentleman believes in the free market, in market enterprise, and in people being able to offer their labour where they can get most return for it, but if there is the pressure that he describes, people will have to look harder at how to retain the staff that they want, which is not necessarily a bad thing. One of the strengths of EU enlargement is that people can come and work in a range of sectors. The effect that the hon. Gentleman describes will be considered when the points-based system is developed, but it must be balanced against allowing people to contribute fully and to use all their skills, rather than being tied to a particular sector. That is particularly true of EU nationals, who should have that freedom.
Let me pick up on a point that the hon. Gentleman made about the rest of the EU beginning to open its labour markets to nationals. He mentioned that there was greater competition to attract people to work here. That might be true, and we have to respond to that, which raises the issue of how easy we make it for people to come here and work. I do not accept his point about Britain not being an attractive place for students to gain work experience. It is an extremely attractive destination and will continue to be so.
There may be more A8 nationals employed in the agricultural sector than the worker registration scheme statistics suggest. The National Farmers Union and the Association of Labour Providers consistently tell us that the worker registration scheme under-records the number of accession state nationals employed in the agricultural sector. If so, one reason for the under-recording may be that the WRS requires workers to be registered only if they have worked for a particular employer for a month. Seasonal agricultural work is no doubt more transient than other types of work, and many workers—research suggests almost half—may stay with a particular employer for less than one month, so it is possible that those people are moving to other employers within the agricultural sector.
The Government's view is that the availability of workers from an expanded EU calls into question the continued need for SAWS. It is not simply that an alternative source of labour is available; it is also a question of the robustness of the scheme. SAWS is a temporary migration scheme. Participants who are students are expected to return overseas at the end of their six-month stay. The evidence is that participants from eastern Europe have traditionally complied with that requirement. We are, however, responsible for upholding the integrity of the immigration system, and if SAWS were to continue alongside accession country migration, participants would necessarily be recruited from further afield and possibly from countries whose nationals have less incentive to return at the end of their stay. That is why this is an immigration matter—I must take issue with the hon. Gentleman on that point. SAWS must be seen within the context of the changing picture of immigration more generally.
There are two principal objections to a policy of relying on EU labour. The first is that employers in the agricultural sector have difficulty retaining workers who are free to take more attractive employment. I understand and accept that point, although the evidence does not entirely bear that out. We have examined WRS applications and have found that 50 per cent. of those who initially registered as employed in the agricultural sector and then changed employment changed jobs within the sector. As I said, the hon. Gentleman's claim has some basis in fact, but it is not entirely accurate. Individual employers may have problems retaining workers, but that is not necessarily true of the sector as a whole. If the retention of workers in this sector is an issue, however, we must find long-term solutions other than temporary migration schemes.
Secondly, as the new member states prosper, they will cease to provide a source of workers who are prepared to take unattractive jobs in the UK. That may well happen and we will need to monitor the situation, but there is little to suggest that it is happening now. Furthermore, the drying up of the new member states as a source of workers for low-skilled jobs may occur in tandem with the further expansion of the EU, which will compensate.
The role of temporary migration schemes in meeting the need for temporary workers in the agriculture industry needs to be put into context. SAWS is designed to meet a seasonal need for labour rather than any endemic labour need, but the evidence is that labour need in the agricultural sector is increasingly a year-round phenomenon. Research commissioned by the Department of Environment, Food and Rural Affairs and the Home Office suggests that demand for temporary workers, the majority of whom are engaged in packing and grading, peaks in the winter rather than in the picking season. If agriculture increasingly needs a year-round work force, it follows that that need is best met by relying on those with the freedom to enter the labour market rather than relying on seasonal immigration schemes.
We need to be realistic about how far migration, or at least specific low-skilled, temporary migration schemes, can or should meet the labour needs of the industry. The objection that removing such migration routes would lead to an increase in illegal working in the sector also needs to be put into perspective.
The research that I just mentioned suggested that the total number of temporary workers employed in agricultural, horticultural and collocated primary processing businesses was between 420,000 and 611,000. Only 3 per cent. of businesses in that sector that use temporary labour use the seasonal agricultural workers scheme. Some of those businesses may be concentrated in particular parts of the sector, but the seasonal agricultural workers scheme is quite marginal to the overall labour needs of the sector.
The number of workers admitted under SAWS is also small compared with the total number of migrants admitted to the UK in other categories and who are free to work some or all of the time. The figure was approximately 450,000 in 2003, and no doubt some of those migrants work in the agricultural sector. One way forward where needs emerge may be to encourage those who enter under other categories, such as youth mobility schemes, to take work in the agricultural sector. We continue to consider those issues as we develop the points-based system.
The Government are taking measures to address illegal working in the agricultural sector. In particular, the Gangmasters (Licensing) Act 2004 will require the licensing of labour providers in the sector and compliance with conditions set by the Gangmaster Licensing Authority, including compliance with the law on illegal working.
As I have said, no decision on the timing of phasing out SAWS has been taken, and we will want to take account of the views of the industry in taking that decision. We will also take account of the views expressed by the hon. Gentleman today. It remains the Government's view that opening up our labour market to the new member states should remove the need for temporary migration schemes to meet labour shortages at low-skill levels. The Government hear what the hon. Gentleman says. We are working to develop a system that responds to the needs of the industry and gives us an immigration system in which we can all have confidence.