Leaving the EU: Agriculture — [Mr Peter Bone in the Chair]

Backbench Business – in Westminster Hall at 2:56 pm on 1st February 2018.

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[Mr Peter Bone in the Chair]

Photo of Alistair Carmichael Alistair Carmichael Liberal Democrat Chief Whip, Liberal Democrat Spokesperson (Northern Ireland) 3:00 pm, 1st February 2018

I beg to move,

That this House
has considered the policy framework for agriculture after the UK leaves the EU.

As ever, Mr Bone, it is a pleasure to serve under your chairmanship.

Before I start, I should say that I am very grateful to the Backbench Business Committee for having allowed the House the opportunity to debate this subject today. I see a reasonable number of Members in Westminster Hall, so I shall try to keep my remarks fairly short, to ensure that everybody gets a chance to have their say.

First of all, however, it is worth noting the context for this debate. For the 40-plus years that the United Kingdom has been a member of the Common Market, the European Economic Community and ultimately the European Union, the common agricultural policy has been the dominant force in shaping agricultural policy in the United Kingdom. As is often the case when there is such a dominant force, we can get dragged down into the weeds. We can lose sight of the higher purpose—I suspect that, if pressed, any of us could come up with lots of things that we dislike about the CAP.

The moment of our leaving the European Union will be, of course, an opportunity to change much of that and to do things differently, if that is what we choose. However, it is worth reminding ourselves about the context of what has been achieved and the nature of the agricultural industries—I use the plural advisedly—that we have had for the last 40 years as a consequence of our membership of the EU.

Some would say that this is a moment for moving away from financial support for agriculture completely—the New Zealand “cold turkey” approach. That is a respectable view; it is not one that I happen to share, for reasons that I will explain. However, it is a statable case, and if we are sensible it is one that we should address. When the Secretary of State recently made a speech at the Oxford Farming Conference, he spoke about the CAP being a mechanism for subsidising inefficiencies. One man’s inefficiency may be another man’s lifestyle, so I listen to terms such as that being bandied about with some caution, shall we say.

What would be the consequence, though, of ending the support there has been for agriculture? The most obvious consequence, in my view, would be food price inflation. There is a cost attached to maintaining an agricultural business, and if farmers are not to get the money they need through the mix of what they get at the farm gate and financial support from Government, then of course a higher price will have to be paid by the consumer in the supermarket.

In fact, earlier today it was put to me that the most obvious victims of the end of the era of cheap food—the era in which we have lived and continue to live—would be those on the lowest and fixed incomes. That is a good point: people on low incomes spend a higher proportion of their disposable income on food than on anything else. Ending support would also have very profound implications for our countryside. Many of the things that we value most about our countryside come about because people live there—because they can work there and make a living there. The countryside is not just a glorified retirement home.

I have seen a lot of farms’ books in my time as a Member of Parliament, for a whole variety of reasons. When it comes to farmers in my constituency and throughout the highlands and islands—and doubtless those in other parts of the country—there simply would not be a living to be made without the farm subsidy payment coming into their businesses every year. We would lose the farms, then the shops and the post offices. The country schools would close, which would lead to the loss of professional support, such as the lawyers, accountants and the vets. With that loss, we would start to lose the mix that a rural community needs to sustain itself. Thereafter, it is pretty easy to see where we would go.

The alternative to food price inflation, of course, would be to import cheap food from other parts of the world. However, I caution hon. Members about that. One of the reasons why our costs of production are high in this country, relative to other parts of the world, is that we maintain very good standards of animal welfare, traceability and biosecurity. Those all come at a price. We are told that such things are valued by the consumer, and there is a price attached to that. If our farmers are to compete on a level footing, we should expect the same standards in those countries from which we would envisage importing food. At that point, one would wonder whether the price difference between food produced here and imported food would be as marked as it is now.

In that context, the CAP and support for agricultural industries have given us considerable stability in recent decades. There is then the question of what will follow the CAP. If we take away the framework that we have had since the mid-1970s—the CAP—we will inevitably have to replace it with some other sort of framework: a UK-wide one, if that is to be the extent of our regulation. I am pleased to note an emerging consensus between the UK Government and the devolved Administrations: that the creation of a UK-wide framework is a desirable and necessary event, which will have to be taken seriously.

To my mind, there are something in the region of four different objectives that such a new framework would need to have built into it. First, and most importantly, it would need to preserve the functioning and integrity of the UK internal market. That is important for consumers and producers across the length and breadth of the country. Secondly, it would need integrity, to ensure that the UK was in a position to enter into trade agreements with other countries. Thirdly, it would have to ensure that the United Kingdom could continue to meet its existing international obligations, never mind those that we may seek to take on. Fourthly, it should provide for effective management of common resources. As I say, the first of those four objectives—preserving the integrity of a UK internal market—is the most important.

As the National Farmers Union Scotland has put it in one of the many briefings that have been provided for today’s debate,

“animal welfare and traceability, public health, pesticides regulation, and food labelling” should all be part of a “commonly agreed ‘framework’”. That is in the interests of all parts of the United Kingdom.

Of course, once an overarching framework has been agreed, everything else that remains should be devolved to the constituent parts of the United Kingdom. For the purposes of England, that would obviously be the Department for Environment, Food and Rural Affairs; the Scottish, Northern Irish and Welsh Assembly Governments would have control and responsibility for their own respective jurisdictions. The thinking that needs to be done now about how we design that framework is important. We need something that will allow each Administration to implement it as is appropriate for their area.

As one who was always a keen supporter of the idea before it happened, I think that devolution since 1999 in Scotland has been very good for Scottish farmers. They say that the administration of agricultural policy from a dedicated Department in Edinburgh has been better for them: it is closer to their needs and better able to design a system that is suitable for the farmers in our constituency.

I am sure that that is true across the whole United Kingdom, so the framework must provide a structure without tying the hands of the devolved Governments. They should be able to continue to do as they currently do: look after the less favoured areas such as the highlands and islands, and perhaps then the beef farms and dairy farms; I am thinking not only of Orkney and such places, but the north-east of England—I see Mr Jack from the south-west of Scotland—or the south-west of England.

There are upland farms in Yorkshire and Cumbria. All the different industries have needs that are best met by devolved Administrations delivering policy in their own jurisdictions. For that reason, when the framework is constructed, it has to deal with those matters in a way that that can be commonly agreed. If the Minister has not already had representations from the NFUS, although I suspect he probably has, he should consider its proposal for the creation of a strengthened joint ministerial Committee. The mechanisms of devolution already make provision for that sort of thing, but as we move to the next phase of our constitutional change, it is pretty clear that something of that sort will be necessary.

The idea posited to get a commonly agreed mechanism is that something such as qualified majority voting, as is often used in the Council of Ministers, could be engaged. The advantage would be to create something that was genuinely a common agreement, rather than a top-down approach where control would still be vested in DEFRA and in London.

Inevitably, one comes on to the question of finances. Currently the United Kingdom remits money to Brussels, which then pays the respective Administrations money that goes in a dedicated way to farm support. Obviously, after our departure from the European Union, that supply line will be significantly shortened and we shall look to the Treasury. I do not see any other mechanism than that the money should come from the Treasury, but perhaps the Minister has other ideas about how that would work. More importantly even than that, we need to know the mechanism by which that funding will be distributed across the different parts of the United Kingdom. For most public spending purposes, we currently have the Barnett formula, but that takes into consideration a whole range of different matters that would not really be relevant, so some sort of thinking at this point will clearly have to be done.

On the brass tacks of this, when the Minister comes to reply to the debate today—I realise we are in the early stages of the thinking and we can look only for broad principles—will he confirm that the pie that we will slice up by whatever mechanism we devise will remain the same size as the one we currently have? The one thing that consistently comes through to me, from talking to farmers and crofters in my constituency and to the farming unions, is that at this stage our objective should be continuity and stability. Farmers really need to know what the future holds for them. If we do not have early confirmation of what the future holds, we cannot expect them to have the confidence to keep investing.

A whole range of imponderables will come from our decision to leave the European Union. Access to export markets, the terms on which imports will be allowed from other countries, and the availability of labour for both the production and processing of food are just a few of them. All those matters are outwith our control, but the creation of a UK-wide framework is one element entirely within our own control; more than anything else, it will give our farmers the opportunity to continue their planning for future investment.

In his speech at the Oxford Farming Conference, the Secretary of State guaranteed support payments to 2024. That was a welcome announcement and I do not want to diminish the importance of it in any way, but in doing that he prayed in aid the need for long-term certainty.

I speak as a farmer’s son. I know two things about farming. First, I knew I was never going to be one; that is partly why I am here today. Secondly, I know that six years for a farmer is nothing like the long term. The long term is what agriculture is built on and what our farmers and crofters need to hear about. I hope the Minister will at least give an indication that we have started the process of giving it to them.

Photo of Alister Jack Alister Jack Conservative, Dumfries and Galloway 3:16 pm, 1st February 2018

It is a pleasure to serve under your chairmanship, Mr Bone. I congratulate Mr Carmichael on securing this debate. I listened intently to his speech and he will be pleased to hear that I agreed with absolutely everything he said. However, that will not stop me saying some of it again.

Brexit is a great opportunity for us to reform the policy framework for agriculture in a way that promotes both the agriculture sector and the environment, but it is crucial that we get it right. In Scotland, a healthy agricultural sector makes for a healthy economy. Across agricultural production and the food and drink industry, Scottish farming and crofting supports more than 400,000 jobs. Scottish agriculture has functioned for decades under the EU’s regulatory framework, including the flawed and inefficient common agricultural policy. It is no surprise, therefore, that a majority of British and Scottish farmers voted for Brexit.

Photo of Peter Grant Peter Grant Shadow SNP Spokesperson (Europe), Shadow SNP Spokesperson (Exiting the European Union)

Will the hon. Gentleman tell us the source of his information? The National Farmers’ Union of Scotland is under the impression that most of its members voted by a narrow majority to remain, so what is his source of information?

Photo of Alister Jack Alister Jack Conservative, Dumfries and Galloway

My source is the farming press. According to The Scottish Farmer a survey revealed that 66% of Scottish farmers said they had voted for Brexit.

Many farmers will be glad to see the back of the CAP and will be looking forward to what will replace it. I am encouraged by the UK Government’s commitment to deliver the same level of farm support money until at least 2024, which the right hon. Member for Orkney and Shetland mentioned. I am also encouraged by the plan to put in place a green Brexit that rewards good environmental stewardship. However, even more can be done.

The CAP has failed to keep up with the pace of change in agriculture, trade and the wider economy. We would be hard-pressed to find many farmers who would describe the CAP as modern, efficient, or even fit for purpose, and that assumes that they get their CAP payments on time, which I know, as a Scottish farmer, can sometimes be a bit of a luxury. We should build an agricultural policy framework fit for the 2020s and beyond that supports a healthy, profitable, diverse, innovative and sustainable sector in a global economy and that seeks to embrace the future and make the most of it, rather than shy away from the challenges it presents. But the issue goes far beyond farm support. As the right hon. Member for Orkney and Shetland said, it is vital that, for example, we maintain our high regulatory standards.

The EU is not a perfect regulator, and Brexit allows us to make changes to regulate better and smarter, and respond more proactively to changing circumstances. There is no case for compromising our standards, and we must make sure that standards in all parts of the United Kingdom are as high as or higher than they are at present. Animal welfare in particular is an area where we should seek to hold ourselves to even higher standards after Brexit. We must also maintain the commitment to high agricultural standards in our trade negotiations with third parties, and develop a framework that ensures that we can make such trade deals while preserving the devolution settlement. I expect that the powers over agricultural policy due to return from Brussels will in turn be devolved to Holyrood at implementation level.

The preservation of the UK internal market should underpin any future framework. If that were not to happen, it would be harder and more expensive for Scottish farmers to trade in the rest of the UK, and vice versa. We cannot allow that. That is a particular concern for farmers in my constituency. Dumfries and Galloway is near England and Northern Ireland, and trades extensively with both. We must not give our agricultural sector trouble at home when it should be seeking new opportunities around the world. We therefore need frameworks that ensure a degree of harmony between all parts of the United Kingdom, and that make sure our common resources are managed as effectively as possible.

Brexit is a challenge for Scotland’s agricultural sector, but it is also a great opportunity that can get the sector flourishing for decades to come. However, that will require the UK and Scottish Governments to work together to create an effective policy framework that can give a real boost to Scottish, and indeed British, agriculture.

Photo of Kerry McCarthy Kerry McCarthy Labour, Bristol East 3:21 pm, 1st February 2018

It is a pleasure to see you here, Mr Bone.

The debate is very welcome. It has obviously been a long time since agriculture policy was in such a period of transition, and where there was so much up for debate and needing to be decided; as we come out of the common agricultural policy we look towards the negotiation of new trade deals, and there is an agriculture Bill on the horizon, I hope. The Environment Secretary has made some welcome statements at the Oxford Farming Conference and the Oxford Real Farming Conference—I attended the latter—which were restated in the 25-year environment plan, about trying to shift to the use of public money for public goods. That must be the backbone of the approach. I welcome his clarity about the ending of subsidy per acre, and using it to pay for public goods. It is encouraging that the direction of travel on that is so clear. Farmers want to do much more to conserve their land for future generations; the structure should be there to support that.

We need to do a much better job of internalising the external costs of the damage we do to the environment, including soil degradation, deforestation, biodiversity loss and the impact on public health of the routine use of antibiotics. Those have been disregarded for too long. I am sure that we all agree on the desirability of the new regime supporting the public goods that the Environment Secretary identified, such as planting woodland and restoring habitats for endangered species, and restoring and enhancing soil. I would add other things, but the direction of travel is good.

As chair of the all-party group on agroecology for sustainable food and farming, I would also like specifically to promote the benefits of agroecological approaches. They are sometimes seen as backward-looking, because they can involve reviving some old-age systems, but I am not personally anti-innovation. I think that agroecological measures can be adopted without a reduction in productivity. As the former UN special rapporteur on the right to food, Olivier De Schutter, said, the approach has been shown

“to improve food production and farmers’
incomes, while at the same time protecting the soil, water, and climate”.

That is the balance we need.

I want to focus my comments on two areas about which little has been said so far. The first is post-Brexit agricultural policy, which urgently needs to address how we increase our food sustainability and, given global pressures, ensure long-term food security. The second is the growth of diet-related ill-health and widening health inequalities. As to food security, leaving the EU potentially puts UK food security at greater risk. At the moment we produce less than 60% of the food we consume and rely on the EU for almost 30% of our imports. Post-Brexit, shortages of farm labour and a more volatile market could make that situation even worse. I am vice-chair of the all-party group on fruit and vegetable farmers. Witnesses from the sector, and the wider horticulture sector, gave evidence to the Select Committee on Environment, Food and Rural Affairs a while ago; the sector is already starting to suffer from the Brexit effect. Last year, there were reports of produce rotting in the fields in Cornwall from a lack of EU workers to pick it, put off by poor exchange rates and uncertain future employment. I know that the Minister has attended the all-party group and the Select Committee to hear our concerns. I am sure that the Committee Chair, Neil Parish, will mention that later.

Nothing was said about the workforce in the 25-year plan. Although the Environment Secretary has said that he recognises the need for seasonal agricultural labour, we do not have a clear indication of what he intends to do about that. We need to ensure that agricultural policy addresses the prevalence of low pay, insecure employment and the exploitation of workers in the food and farming sector. I do not think that that is too much to ask.

Photo of Alistair Carmichael Alistair Carmichael Liberal Democrat Chief Whip, Liberal Democrat Spokesperson (Northern Ireland)

The issue of labour availability is important, but it is not confined to low-paid workers. The hon. Lady should be aware that the veterinary profession relies heavily on vets who come to work in this country from other parts of the European Union, especially for meat inspection.

Photo of Kerry McCarthy Kerry McCarthy Labour, Bristol East

I think that I am right in saying that about 85% of the vets from overseas who work in this country have not been in the UK more than five years; so they would not be captured by the arrangements being put in place to enable people to apply for status to stay in the country. That is an important issue.

On the question of horticulture and healthy eating, we need to ensure that our agricultural policy not only maintains but widens access to healthy, nutritious food for everyone. Analysis by the Food Foundation, which was of course set up by a former Conservative MP, who is doing excellent work, shows that a British family of four could be spending up to £158 per year more on fruit and veg after Brexit, as a result of tariffs, inflation and increased labour costs. That is a huge amount of money for those already struggling to put nutritious food on the table. Ninety-two per cent. of teenagers in the UK already struggle to get their five-a-day, and diets low in vegetables are linked to 20,000 premature deaths every year. We had a debate in Westminster Hall the other day about the links between junk food and childhood obesity. Cancer Research provided inspiration for that debate, and the other side of the healthy eating coin is obviously the consequences of unhealthy eating.

Photo of Colin Clark Colin Clark Conservative, Gordon

Does the hon. Lady accept that produce has never been so affordable or abundant, and that it may be more of a reflection on society that teenagers do not eat enough fresh produce, rather than what she suggests?

Photo of Kerry McCarthy Kerry McCarthy Labour, Bristol East

It is partly due to consumer choice; but it is also a question of what is presented to people in supermarkets, and the encouragement to people to get cheap ready meals. As we saw during the horsemeat scandal, it is much easier for people with a very limited income, who are running out of money before their next pay cheque, to buy a ready meal such as a lasagne that costs 99p or a pack of 12 Tesco burgers in the Value range, than it is to buy all the separate ingredients that would enable them to cook a similar meal at home. They just do not have the resources to do that.

That is something that the Food Foundation stresses. It says that if we increase the level of UK self-sufficiency in fruit and veg, production could become more competitive in comparison to pricier imports, and that there are 16 types of fruit and veg that we could grow more of in the UK, which would increase supply and help to protect demand in the uncertain times of Brexit. Last summer there was a sudden shortage of iceberg lettuce in shops because of the situation in Spain. I am sure that the Minister has looked at the Food Foundation report “Farming for 5-A-Day”, but if he has not I urge him to do so.

I want to raise the real threats to UK food and farming from a no-deal scenario and from free trade agreements with the US and countries with lower animal and food safety standards. The most carefully structured subsidy regime could be fatally undermined by the trade arrangements we enter into post-Brexit. The all-party parliamentary group on agroecology highlighted that in our recent inquiry. We found that trade deals post-Brexit could pose the biggest peacetime threat to the UK’s food security, if current environmental and public health standards are not prioritised in the terms of the negotiations. It is vital that agriculture does not become a bargaining chip or something that can easily be traded away during negotiations. We know there is a difference of opinion between the Environment Secretary, who has sworn that he wants to uphold standards, and the Trade Secretary, who has a less acceptable stance on these issues. He does not appreciate how much the public care about protecting these things.

There is a very real danger that when faced with the threat of rising food prices post-Brexit, many will argue for cheaper food through low or no tariffs, but that will come at a cost. The US Commerce Secretary, Wilbur Ross, has made it clear that any post-Brexit trade deal will hinge on the UK ditching its higher EU-derived food safety laws. The debate on chlorinated chicken and hormone-pumped beef is very much in the public domain. That situation could drive out higher-welfare and smaller-scale UK farmers who would be unable to compete on price. It could make it more difficult for British farmers to export to EU countries, with worries that they could provide a back door to the EU for these US imports. There are food safety issues, too, with US eggs and poultry much more likely to have salmonella contamination than UK products. At a recent meeting of the EU environment committee, Which? gave evidence. It said that something like one in six Americans get food poisoning over the course of a year, compared with one in 66 in the UK. That cannot just be down to poorer hygiene standards in people’s homes.

We cannot trigger a race to the bottom on standards. Nor should we seek to compete by copying American mega-farms, cutting costs by becoming ever more industrialised and intensive. One of the recent farming Ministers was very fond of the phrase “sustainable intensification”, but I never quite got him to explain what he meant by that.

Photo of Andrew Percy Andrew Percy Conservative, Brigg and Goole

The hon. Lady is making an interesting speech. It is important that our policy on food standards is evidence-based. Salmonella rates are 1.5 times higher in Europe than they are in the US. We must not proceed in any trade deals on the basis of any anti-American bigotry. I am not suggesting that the hon. Lady is guilty of that, but some who contribute to these debates are. We must proceed only on the basis of evidence.

Photo of Kerry McCarthy Kerry McCarthy Labour, Bristol East

I agree with that, but the Soil Association has come up with a list of 10 products that are currently banned that could enter UK markets if we enter into a trade deal with the US. Chlorinated chicken and hormone-pumped beef were banned for very good reasons.

Photo of Kerry McCarthy Kerry McCarthy Labour, Bristol East

We have different views on EU protections, but the EU ban on chlorinated chicken was introduced in 1997. Hormone-pumped beef was banned before that. If the hon. Gentleman asked his constituents whether they wanted these products in the UK market, I think they would support his Environment Secretary’s position, whether they see these things as animal welfare concerns or food safety concerns. When he was giving evidence to the Select Committee, the Environment Secretary said that he saw that issue as a red line in negotiations and that we should not allow such things in. Perhaps the hon. Gentleman can ask the Environment Secretary what evidence he has considered. On that note, I will conclude my remarks.

Photo of Scott Mann Scott Mann Conservative, North Cornwall 3:33 pm, 1st February 2018

It is a pleasure to serve under your chairmanship, Mr Bone; I think it might be my first time. I congratulate Mr Carmichael on securing this important debate. I have four points that I would like to make, and I will try to keep my remarks brief because we have got just under half an hour before the first Front Bencher is called. The four points are about subsidies, promoting agricultural jobs, migrant workers and environmental protections.

On subsidies, it is my firm belief that the common agricultural policy is fundamentally flawed and wasteful. The UK could implement a subsidy of its own that could save money and create better standards. The safeguarding of our current level of subsidies in establishing the new system was a welcome announcement from the Government, but we need to look further ahead, and we need some strategic investment in our agricultural sector. We need to offer capital grants, loans and tax incentives for investing in infrastructure. It is my firm belief that farm-led research and things to do with equipment and buildings should be implemented in collaboration with farmers.

The need to support new entrants and succession in farms is an issue that I have picked up when I have been out speaking to my farmers. There seems to be a break in people wanting to take part in agricultural work. We need to ensure that we invest in that. We also need to make things much more resilient for farmers who need protection against and compensation for unforeseen circumstances, such as crop blights. We have a step to go in that direction, but by promoting agriculture, we will see huge investment in the south-west.

Secondly, there are big opportunities for tech-based agriculture jobs. I recently met with Duchy College in my constituency. People there talked to me about how they are linking food and agriculture, and teaching young people about how the new innovation and tech of the future will benefit them. The Government also need to explore the opportunities for apprenticeships in agriculture. We have not done enough in that regard, and we owe it to our agricultural workers to do much more.

My third point is on migrant workers. We heard from Kerry McCarthy about the challenges around crops in Cornwall. In the south-west, 57% of our workers in the meat sector and 40% of people in the egg sector are migrant workers. Leaving the EU will enable us to control the number of people entering and leaving the UK, but we must maintain the balance by ensuring that we have the right people in place to do farm work. We need that to continue.

The NFU has been keen to promote an agricultural permit scheme for a 12-month visa. We had a seasonal agricultural workers scheme that stopped in 2012 or 2013, and we should look again at that. We have a challenge that we need to address to ensure that everything in the field is brought in on time. In the short and medium term, I want our farmers to have access to labour markets and visas. In the long term, we should be looking to retrain and re-employ British people to do those jobs and to bring in EU or other workers if and when required.

My main point is about environmental protections. I see big opportunities post Brexit for us to have a British agricultural policy that shapes production and improves environmental standards. I recently went out with the Westcountry Rivers Trust on a farm visit in my constituency, and the trust talked me through its work on upstream thinking. It implements a policy with a water company to provide a 50% grant to take slurry pits away from water courses. As we move towards a British agricultural policy, our water protections, our improvements to soil quality, our ability to maintain the uplands to store water and our ability to deliver high standards of animal welfare are all vital.

In conclusion, I am firmly of the belief that we can improve our production and increase our environmental protections at the same time. We will need to shape a British agricultural policy. I am looking forward to the agriculture Bill coming to the House. I ask the Minister to consider the points I have made.

Photo of Peter Bone Peter Bone Conservative, Wellingborough

I advise Members in the Chamber that I would like to start the wind-up speeches at 4 o’clock. First, I will call the people who have notified me that they wish to speak. If we have time, I will call the others.

Photo of Neil Parish Neil Parish Chair, Environment, Food and Rural Affairs Committee 3:39 pm, 1st February 2018

It is a pleasure to serve under your chairmanship, Mr Bone. I congratulate Mr Carmichael on securing this important debate and getting Back-Bench time. It is also good to follow my hon. Friend Scott Mann, who I know is very supportive of farming, agriculture and the countryside. It was good to hear what he had to say. I agreed with the right hon. Member for Orkney and Shetland when he said that the countryside and farming are intricately linked, and that farmers are very much a part of the community. He may be a farmer’s son who is no longer a farmer, but I am a farmer’s son who is still a farmer. We have much in common, even if he is not farming now. We were both born on a farm and have farming in the blood.

As we move forward, we have to look at exactly what we want agriculture and our land to provide. We want it to provide good, wholesome food, and a good quantity of food. Let us not just play at farming; let us have proper production. The common agricultural policy has many sins, but the money that comes in through the basic payment scheme is used by the farming community—especially family farms—to keep farming going and to keep it profitable. Contrary to popular opinion, most of it, especially in the livestock sector, does not drive food prices up. I suggest it probably keeps them down, because it keeps a level of production going, which is key as we leave the EU.

The Environment, Food and Rural Affairs Committee is conducting an inquiry into all the commodities. Some 70% of our exports go to Europe, so we need a combination of support payments, continuing into the future, and access to that market. We cannot have a New Zealand or Australian-style policy, because when the New Zealanders and the Australians got rid of subsidies they had virtually no regulation on their farmers whatsoever. The result would be a perfect storm were we to say, “Okay, we’ll allow all the food in. Let’s not worry about tariffs. Let’s have the cheapest food we can get from South America—Argentinian and Brazilian beef. Let’s get our sheep meat from New Zealand. Let’s not worry about the cost and the price of produce in this country.” We cannot do that, for the simple reason that we want an improved environment, and our farmers will have many controls, quite rightly, on the way we control water and nitrates, and the way we help to stop flooding. All those things are great benefits, but they come at a cost.

There needs to be a real policy, and I know the Minister is very keen to see that. I welcome the support payments, but whatever period we have them for, I do not want them to stay roughly the same and then fall off the edge. Whatever we do, we change the system of payment and move farmers in another direction. Certainly, we can make farming more competitive, and we can give grants and support, as my hon. Friend the Member for North Cornwall said, to help that happen. However, when it comes to livestock and the sheep and beef sectors, it is very difficult to see, given the present pricing structure, how those industries will thrive without some support.

Kerry McCarthy rightly talked about the availability and affordability of food. That is why we need enough production. We can have a great farm shop and a great tourist attraction, and we can sell food to our tourists—that is all great stuff—but it is perhaps 1% or 2% of the total production in this country. It is no more than 5% of food. We need to make sure, as we go into our large retailers as consumers, that we get British food. Back in the ’80s, around 80% of food was produced and consumed in this country, but that has gone down to 60%. Perhaps some tastes have changed. Even though we have a bit of global warming, I do not think that we can quite grow bananas, oranges and rice yet. Seriously, though, we still have a great opportunity to produce more food.

We also have a great opportunity to keep the environment sound. Where we draw water for our reservoirs, let us look at the amount of nitrates going into that water. Such things are important; however, every time we restrict a farmer in his or her operation, there is a cost. I do not think that our consumers and the population of this country really see the opportunity that that offers to support farming. I do not believe that we should control farming so much that we stop that production and the income from it. We have to do a combination of things. I know the Minister is very keen on looking at insurance policy and how we might remove some of the fluctuations in price. All of that is right, but the policy has to be a practical one that farmers can afford to buy into.

As we go forward, we must also look not only at ways to get new entrants in, but at our tenancy laws and how we rent our land. Perhaps slightly contrary to what I have been saying, as much as we like the support that comes to farming through the basic payment scheme, there is an argument that it drives rents up and can therefore make land, particularly for young entrants and other coming in, more expensive. As we target the payments, they must end up in the pockets of those who do the farming, manage the land and look after food production and the environment. I am very keen to see that that happens.

I do not believe that coming out of the EU will be a disaster, or that it will lead us to a great sunny upland where everything will be rosy—perhaps the Minister and I may slightly disagree on that. I think we have to be realistic as we leave. Food production is necessary. I am very fond of our Secretary of State, and I know that he loves to talk about the environment, but I want to hear more about food, farming, production and how we are going to feed the nation. It is important that we keep those exports going and that we have a market that works.

The environment is great, but we need a market along with the environment. We need profitable agriculture above all things. The Minister will know as well as I do that if someone goes to the bank manager and they are not making a profit, they will not stay in business for long. I have huge confidence in the Minister, and I am sure that he will have huge influence on the Secretary of State, so that when he gets to the National Farmers Union conference in a couple of weeks, we will hear about food production and how we will keep farming and food going in this country.

Photo of Colin Clark Colin Clark Conservative, Gordon 3:47 pm, 1st February 2018

It is a pleasure to follow my hon. Friend Neil Parish, and to serve under your chairmanship, Mr Bone. I refer hon. Members to the register of interests: I am an active farmer and a recipient of single farm payment.

Many people have referred to the speech at the Oxford conference, which was described in Farmers Weekly as

“one of the most important speeches for UK farming in living memory”.

I think that is testament to the vision that the Secretary of State has had. On the face of it, funds are guaranteed, but it is up to the devolved Governments to set their own policies.

I have been involved in the agri-food industry for my entire career. I believe passionately that productive agriculture and protecting the environment are mutually inclusive—having well-to-do, or economically viable, countryside is the best way to protect the environment. The vast majority of our countryside environment has been shaped by man. We should not kid ourselves that this is North America; this is not a big wildlife park. It is very important that the general public realise that the main purpose of agriculture or farmland is to produce food. Many hon. Members have spoken about the affordability and availability of food, which is what is ultimately important. It is estimated that every household contributed £400 to the CAP every year, but we have affordability, availability, and wholesomeness in food that we have never seen before. The policy framework must recognise the importance of affordability of food because, as Kerry McCarthy said, many people find it difficult to make budgets balance, and we cannot have wild fluctuations in the price of food. It is not good for farming.

I have been involved in produce for ever, or at least since I was in my 20s [Interruption.] Not quite for ever—I thank my hon. Friends for their asides. If the production goes up, the price goes down. We have to have a leveller.

I would also clarify that a support payment, not a subsidy, supports agriculture and the food industry—the biggest manufacturing industry in the country. The vast majority of payments are effectively reinvested in the business. Anybody who looks at agricultural statistics will see that farmers are not making a fortune in the islands; they are not making a fortune in Gordon and they are not making a fortune in Dumfries. It is important to recognise that.

We must bring to the debate the scale of British farming and the proportion produced in the different areas. It is important to realise that the scale of farming in the UK is, on average, bigger than in the rest of the EU. It is very productive and relatively efficient, despite the CAP. A system of payments that achieves environmental and productivity targets would allow a mix of farming. There are 19,700 claimants in Scotland alone. Some 8,000 of them claim less than £5,000, and it is obvious that there is a socio-environmental opportunity there, not just a purely agricultural one.

The National Farmers Union Scotland has its own negotiation to do with the Scottish Government, and I will not speak about Scottish policy here because that will be formed in Scotland, but I would clarify one point. There have been concerns about a DEFRA-centric approach to the devolved countries, despite Ministers being crystal clear that that is not the case. For absolute clarity, I would ask the Minister to state clearly that there will not be a DEFRA-centric policy dropped down on to Scotland.

It is clear from comments made by many Members that we want to see a common framework across the whole of the United Kingdom. That is just good practice. Farmers in Aberdeenshire have as much to do with farmers in Lincolnshire as they do in Essex; similarly up and down the west coast. It is very important that we have standards across the entire UK, and how they are policed is also important. England, Scotland, Wales and Northern Ireland should be policed effectively, perhaps by some sort of super-environmental agency, as DEFRA has suggested.

There is an 80/20 rule in agriculture: 80% of all production is by 20% of farmers. It is probably nearer to 10% to 90%. It is important to recognise that the affordability of food depends on scale and productivity. Having come from the retail sector, I have seen rapacious rationalisation by the supermarket. In the long run, that does not bring us any benefit; it brings far too much dependency on one or two very big players, which makes us very vulnerable to food scares or problems.

Affordable food is every bit as much a public good as the environment. They must go hand in hand and I hope the policy framework will respect that.

Photo of Luke Graham Luke Graham Conservative, Ochil and South Perthshire 3:52 pm, 1st February 2018

It is a pleasure to serve under your chairmanship, Mr Bone. I congratulate Mr Carmichael on securing this important debate. Many of my points have been raised by other Members, so I will keep this short and sweet, and make three key points. First, I will touch lightly on the UK framework and funding; secondly, I will talk about the opportunity to do things differently; and thirdly, I will stress the importance of the environment and infrastructure in the development of UK frameworks.

In my constituency of Ochil and South Perthshire, agricultural industries are a cornerstone. They are involved in land and environmental management. They create jobs. They help integrate the economies of the villages and towns that make up the constituency. Although farmers are different, whether they are arable, livestock or dairy, and face different challenges in different parts of the country, there are some common challenges throughout the UK, including price pressures from retailers, international competition and the pressure on innovation and value. It is important when we develop UK frameworks that we recognise the differences throughout the United Kingdom, but also that we, as elected Members, make sure we are reaching through each part of the United Kingdom to recognise the common challenges faced in each of our constituencies, and that we make policy that works for the entire United Kingdom.

As my hon. Friends have outlined, funding and decisions on how the spend is distributed should be devolved, as currently. However, it is very important that, whatever the UK body turns out to be, the funding should be ring-fenced. When Westminster is putting money out to the devolved Administrations around the United Kingdom, that should be ring-fenced and protected, so that devolved Administrations, which may be under some political pressure, do not shift funding from agriculture into health or transport or whatever might be the subject of political pressure at the time—maybe even things such as IT systems.

When we devolve different areas of funding, as already takes place, we still maximise the benefit of being one United Kingdom together. Central Departments such as DEFRA have central resources such as IT systems. Perhaps the devolved Administrations should have freer access to those things, which could save money and help farmers with the receipt of payments and other administrative tasks.

My second point is about the opportunity to do things differently. The Secretary of State outlined in his Oxford speech that we have a chance to develop our own policies, shaped by our collective interests. I could not agree more. This is an opportunity to tackle the criticisms of the common agricultural policy. Anyone who studied politics or economics at Higher or A-level has been taught for many years about butter mountains and the inefficiencies of the system. This is our chance to address that. We can create a bespoke policy for our industries, not for one political party.

On the environment and infrastructure, we have stressed the importance of the protection of the environment and its preservation, but it is important to remember that my constituency and others across Scotland and the United Kingdom are not biscuit-tin communities. They are active, working, agricultural landscapes. We have to make sure that we are educating people across the UK to understand the value of the agricultural industries, which help preserve, protect and progress the environment as a working, living landscape.

This is a prime opportunity for us to start redirecting payments towards more infrastructure. In reports on broadband over the last week, rural parts of our country fall vastly behind urban parts. We have targets of 95%, reaching 100% under the devolved Administration, for superfast broadband. My constituency is at 83.3%. I hope that when forming policy we look not only at direct payments but at how we can help regenerate our towns and villages and make sure that our rural economies are as connected as our cosmopolitan ones.

It is important that in our UK framework we make sure that we devolve implementation so that we recognise the nuances, but pull together common resources where that will serve our constituents best; that we take note of the opportunity and grasp it with both hands in order to do something differently, and finally, that we recognise the importance of the environment but also the opportunity to invest in more infrastructure.

Photo of Peter Bone Peter Bone Conservative, Wellingborough

I appreciate the courtesy of Members. To give Mr Percy a little longer, the wind-ups will start slightly after 4pm.

Photo of Andrew Percy Andrew Percy Conservative, Brigg and Goole 3:37 pm, 1st February 2018

Thank you, Mr Bone. It is a pleasure to serve under your chairmanship today. I am not a farmer—I am perhaps unique in that. I do farm votes, however, and I am pleased to say that my productivity rates in every election have improved, so that means I am doing a good job for the farmers I represent. Indisputably, I represent the finest farmland in the United Kingdom, in east Yorkshire and northern Lincolnshire, which is some of the most productive. [Interruption.] I am pleased to hear the cheers of agreement from my hon. Friends.

I have a number of points to make, many of which have already been made, but as Members new to the House will have realised by now, that does not prevent somebody else from making them. I would emphasise the point made by Mr Carmichael. I thought his speech was excellent and there was not much I could disagree with. Particularly important were his two points about a UK-wide framework and maintaining the integrity of the market within the UK. I entirely agree. It is an innovative idea to leave the European Union and then copy the European Union’s decision-making model, but it is one worthy of consideration.

In considering agricultural policy, we have to think in the broader context of the whole of food and drink in the UK and how we support that entire sector. What we do in the agricultural sector is so important in the supply chain through to the food and drink sector, which is such an important part of our exports. I am very involved in food and drink export promotion in my role as the Prime Minister’s trade envoy to Canada, and we need to ensure that policy is connected across Government with that in mind.

Comments have been made about labour flexibility. I am a Brexiteer, and I think we have made the right decision. Last night, I was a remainer, for staying in this place. I look forward to the second vote—obviously, we voted to leave by a very narrow margin.

I and most of my constituents fully understand that we have to maintain labour flexibility. I think most of the public will buy into an immigration system that we can trust, which matches skills to the areas of the country with shortages. Brexit gives us the opportunity to have a sensible, informed debate about immigration, as has happened in many countries, such as Canada and Australia.

I have another point here, but I cannot read my own writing—I used to be a schoolteacher—so I will ignore that. I agree with the comments that were made about animal welfare. My real reason for coming here this afternoon is that I want to talk about what we do in terms of our trade deals with the rest of the world. As I said when I intervened on Kerry McCarthy, we must build trade deals on the basis of evidence. In the previous couple of Parliaments, I was very involved in the all-party group on transatlantic trade. It originally focused on the transatlantic trade and investment partnership negotiations, which of course are going nowhere, but eventually focused on the comprehensive economic and trade agreement.

I want to chide the Secretary of State slightly, because some of his comments about American food production and chlorinated chicken have not been helpful to our future relationship. Having access to the US market is incredibly important to British farmers post-Brexit, just as it is important for American farmers to gain access to our market. Any agreement must therefore be based on evidence. Let us look to the CETA model. In those negations, the language that Ministers, Secretaries of State and European Commissioners used was always modest—I will not say that it was not extreme, because that would be a terrible thing to say. The EU and Canada had big differences on standards. In particular, we had a 20-odd year dispute with Canada at the World Trade Organisation about hormones and antibiotics in beef, but it was resolved through CETA and has now ended. Of course, that beef is not coming into the European Union.

Where we have differences, it is still possible to negotiate a deal. Some of the comments that have been made about things such as chlorinated chicken have fed anti-American bigotry, which would not be accepted in any other relationship. There is a lot of evidence out there about chlorinated chicken. I do not propose to go into it, other than to point out that a person would have to eat a full chlorinated chicken to get the same amount of chlorine as they would get from one glass of water. I do not see many people advocating drinking or importing raw water. We must do this on the basis of evidence.

Some of the differences between the EU and the US are based on trade defence, rather than science, so let us have a scientific, evidence-based trade policy. The Secretary of State should be conscious of the fact that talking down the prospect of trade deals with a market as big and important as America is not particularly helpful. That said, it would be incredibly difficult to come to such a deal—I do not underestimate this—particularly if it includes agriculture. The all-party group on transatlantic trade went out and met various American food producers, including an American beef producer—he had a Stetson on—pork people and chicken people. I am not going to pretend that it will be easy to negotiate a deal. Given the agricultural propositions in CETA, it may well be very limited, but let us not buy into this bigotry. Let us ensure that our policy on agriculture and trading relations more generally is evidence-based. I hope the Minister will take that message back to his Secretary of State, who otherwise is doing an excellent job in his new position.

Photo of Peter Grant Peter Grant Shadow SNP Spokesperson (Europe), Shadow SNP Spokesperson (Exiting the European Union) 4:03 pm, 1st February 2018

It is a pleasure to serve under your chairmanship, Mr Bone, and to start the summing up speeches.

We have had an interesting debate, but the most interesting aspect of it was what nobody said. Despite the fact that the overwhelming majority of those who spoke were Conservative MPs, nobody suggested that free-market capitalism should be the basis for the production of our most basic, fundamental commodity. Mr Carmichael—I congratulate him on securing the debate—raised that possibility for as long as it took to shoot it down.

One thing is clear: whether we are in or out of the European Union, we need some kind of sustained Government intervention in our agriculture and food production industries. That is partly because where we have tried to run them through a free, unrestricted market, it has not worked. Does anybody seriously think we have struck the right balance between Tesco and the farmer with 50 or 60 cows, who is trying to get a decent price for their milk and to make sure that the person they sell it to this week will come back and buy it next week?

We have to be cautious, because although everybody can point to the faults, failings and weaknesses of the common agricultural policy, at the moment nobody knows what we are going to replace it with in 16 or 18 months’ time—perhaps in 30 months’ time if we get a transition and implementation period. We have to be very careful that we do not wait so long for a decision that there is a sudden shock to the system. Farmers are the same as workers in any other industry or business; sudden changes without adequate warning do not help them. I ask the Minister to guarantee that we will know about any decisions that are taken in plenty of time so people can adjust to them.

We have to remember that our agricultural industries are not just about the production of food. They also have a massive impact on the appearance and the very fabric of all the nations in these islands. The way that the land is farmed or worked makes a huge difference to its appearance, which makes a difference to its attractiveness as a place to live and has a huge knock-on effect, for good or for ill, on our tourism industry, for example.

Glenrothes and Central Fife does not look like the most rural, farming-intensive constituency in the United Kingdom, but I reckon about 1,000 households in my constituency live either in isolated homes or in homes in groups of two or three, scattered around the countryside. They do not all work full-time in agriculture, of course, but a lot of them do. My constituency is also home to Cameron Brig, the biggest grain distillery in Europe, and therefore perhaps the biggest customer for grain producers in Scotland—perhaps in the United Kingdom.

Kerry McCarthy made a very well-informed speech, which touched on a lot of areas that other hon. Members did not mention. She reminded us that Brexit is not just about what happens to the common agricultural policy; it is also about where workers come from and what conditions they work under.

On the affordability of fresh food, I think staff at my food bank in Glenrothes would beg to differ with Colin Clark, who said that food has never been more affordable. Andrew Percy used a lot of his time to sing the praises of chlorinated chicken. We respect each other’s views in this place, so the hon. Gentleman is welcome to his opinion. He is also welcome to his chlorinated chicken, but I do not think many of my constituents will be too chuffed if taking back control means that someone else decides whether chicken can be chlorinated.

Photo of Andrew Percy Andrew Percy Conservative, Brigg and Goole

My point was that people should proceed on the basis of evidence. I am not an expert, but my simple point was that we should listen to what bodies such as the European Food Safety Authority say about such things, rather than rely on bigotry. I trust the experts, not those who buy into anti-capitalist, anti-American bigotry.

Photo of Peter Grant Peter Grant Shadow SNP Spokesperson (Europe), Shadow SNP Spokesperson (Exiting the European Union)

It would be nice if the Government’s approach to Brexit was based on evidence, facts and proper analysis, rather than ideology. The hon. Gentleman also welcomed the opportunity to have what he described as an informed debate about immigration. I think it would have been nice if we had had an informed debate about immigration, rather than the desperately ill-informed debate we had up to, through and since the referendum. We have not heard enough about the enormous benefit that immigration brings to these islands and will continue to bring if we allow it to do so.

The hon. Member for Gordon reminded us at Brexit questions this morning that, as far as agriculture is concerned, one size does not fit all. In fact, the danger is that one size very often does not fit anything, so nobody gets the result they need.

Anyone can work out that the needs of a hill farmer or crofter in the highlands of Scotland or in Wales are very different from the needs of a dairy farmer in the south of England, or indeed of a fruit grower in lowland Scotland or lowland Perthshire. That means that whatever framework is put together has got to be capable of being adapted and applied flexibly to ensure that the decisions taken are those that are most suited to where they are being applied.

I do not have an issue, and neither does the Scottish National party, with recognising that in some areas of public policy there are huge benefits to having one framework and one set of rules to apply everywhere. For example, animal welfare standards are common throughout the United Kingdom—good idea. Let us face it, they are going to be common throughout the United Kingdom and the European Union, because we will still want to be able to sell our stuff across the Irish border, so Northern Ireland will have to fit in with European Union standards in the longer term.

It is essential that a decision that something will be taken on a UK framework basis is a decision by consensus. I am waiting, as are a lot of people back home in Scotland, to hear the Government confirm that no UK framework policy will be decided without the consent of the devolved Administrations, and that once it has been agreed that something needs a UK framework, the content and detail of that framework will be agreed by consensus among the four equal partners in the Union, not simply imposed on us by a Government in Whitehall—nor indeed imposed on the farmers of England by a Government in Edinburgh.

Photo of Alistair Carmichael Alistair Carmichael Liberal Democrat Chief Whip, Liberal Democrat Spokesperson (Northern Ireland)

What view do the hon. Gentleman and his party take of the NFUS suggestion that any decision should be taken on the basis of some form of qualified majority voting?

Photo of Peter Grant Peter Grant Shadow SNP Spokesperson (Europe), Shadow SNP Spokesperson (Exiting the European Union)

I am not convinced that defining a specific voting system now would be particularly helpful. I would not have a problem with the system being more devolved in England, if only there were a government structure to allow that to happen, because farmers in Devon do not necessarily need the same response as the farmers of east Anglia—but that is for the people and representatives of England to sort out. If decisions are to be taken that will affect farmers in Scotland, it is essential those decisions are the right ones for Scotland. The best place for decisions affecting Scotland to be taken is in Scotland—if we want to, we can replace Scotland with Northern Ireland, Wales or even Cornwall.

Photo of Peter Grant Peter Grant Shadow SNP Spokesperson (Europe), Shadow SNP Spokesperson (Exiting the European Union)

Yorkshire, absolutely—we could possibly even split Yorkshire into north and south, if the hon. Gentleman wants to go that far.

Decisions used to be taken by Ministers or civil servants in the ivory towers of Whitehall and imposed on communities the length and breadth of these islands, but those days have simply got to be over. Scottish farmers produce a significant amount of our food and export earnings. They often provide employment, as the right hon. Member for Orkney and Shetland pointed out, in areas where there is not a lot of alternative employment. It is important that decisions that affect our farmers are taken by the people they elect.

To pick up on a final point, Luke Graham asked for complete ring-fencing of the funding. Perhaps, but only as long as the decisions about how much funding is to be allocated and what is ring-fenced are taken by consensus—

Photo of Peter Bone Peter Bone Conservative, Wellingborough

Order. I am sorry to interrupt the hon. Gentleman but I have to be fair and ensure that each party gets its allocated time, so we will have to move on.

Photo of Sue Hayman Sue Hayman Shadow Secretary of State for Environment, Food and Rural Affairs 4:13 pm, 1st February 2018

It is a pleasure to serve under your chairmanship, Mr Bone.

I thank Mr Carmichael for securing the debate and recognising the challenges that we face in Cumbria. There have been many good contributions from Members across the Chamber. I thank my hon. Friend Kerry McCarthy for expressing her concerns about food security and labour, which are an important part of the debate.

We have heard that British farming is critical to our economy, providing thousands of jobs and the cornerstone of our food production. It is therefore important for the Government to step up to the plate to get the best deal and maintain the high standards that we have heard about, to enable our businesses and farms to flourish and remain successful. When we negotiate our trade agreements, it is important to make sure that they work for British farming, while protecting the high standards of food safety and animal welfare that our consumers expect. As we have heard from a number of Members, it is important that any deals do not undercut British farming.

Food and farming need to be a clear strategic priority and a cornerstone of the broad industrial strategy that the Government are promoting. I agree that there is a clear need, as hon. Members have said, for a plan to enable food and farming to grow more, so that people have a greater appreciation of British food and are encouraged to buy British at every opportunity. We also need to look at the brand of Britishness to help us to export more and get others to appreciate our high standards.

It is important that we appreciate exactly what is at stake for the farming industry with Brexit. If we get it wrong, that is the nation’s food security, nutrition, environment and public health, as we have heard. Farming is an integral part of the Labour party’s vision of a fairer society—one that tackles the increasing social ills of food poverty, poor diet, environmental degradation and inequality. We believe that we must be ambitious in the creation of our new British agricultural policy, which should aim to establish a new deal and a consensus on what a modern farming industry can do for the economy, rural communities, consumers and the environment. Change cannot be left to market forces alone, as long as farming is critical to our food security and to stewardship of the natural environment.

We have to look at better food labelling, which is vital. If our farmers are to be able to compete fairly under any new trade deals, product labelling must be clear and unambiguous so that people know exactly what they are buying. Such labelling should include the country of origin and method of production.

As we have heard, the issue of farm labour is critical and immediate. Farmers and food manufacturers need to have access to a wider labour market. Without access to that labour, the agricultural sector and food manufacturers will face severe difficulties. A lack of labour will lead to consequences for UK agriculture. We could end up with product being left to waste, the movement of investment and operations out of the UK and, on top of that, price inflation for consumers.

At the moment, the profitability of many farms is too dependent on direct payments from the CAP. Because of the huge diversity in farming and the volatility in many areas, we need to consider how we can support farms to become more resilient, while mitigating the volatility. When it comes to replacing the CAP, we believe that a future payment system must broadly seek to do the following things. We need to look at how we target support to farmers who provide the most public good but may struggle to compete in the market, through no fault of their own—for example, the hill farmers in my Lakeland constituency. Any future system must be transparent as well as relevant. It must be easily accessible—we have heard about broadband—and cost-effective. It should reward environmentally sustainable practice and environmental stewardship, such as the management of habitat and natural resources. I believe strongly that we should recognise the cultural and historical landscape for the benefit of us all.

We should also support flood mitigation through land management, so we need to look at how any future programme can include that. We also need to include technological innovation, and consider how investment in it could meet the aims of improving resource efficiency and animal health and welfare, managing disease and adding value. It could also be used to encourage investment in machinery and software. It is important to support rural communities and family farms as part of any system. They, too, are central to the economy.

In short, any new system must enable profitable and sustainable farming businesses that support a vital and dynamic rural economy. Farmers tell me that their big problem at the moment is uncertainty about the future, so I am looking forward to hearing what the Minister has to say. I hope that anything being developed will provide that certainty and direction for our farmers, so that they can engage in long-term planning for sustainable future prosperity.

Photo of George Eustice George Eustice The Minister of State, Department for Environment, Food and Rural Affairs 4:19 pm, 1st February 2018

I congratulate Mr Carmichael on securing this debate. Like him, I am a farmer’s son. Unlike my hon. Friend Neil Parish, I am not farming now, but I did try farming for 10 years. It is a real honour to be farming Minister at an exciting time: we have an opportunity, for the first time in half a century, to design fresh thinking and coherent policy in agriculture.

As the Minister for Agriculture, I have wrestled with the common agricultural policy, and the rules and bureaucracy, for four years. It is stifling. Although there have been changes to the CAP over the years, in its current incarnation it is a bureaucratic quagmire. It attempts to regulate every single field and every feature in them. Our administrators spend their time fretting about the width of a hedge: whether it is too narrow or too wide, whether the gateway is too big and whether there are too many trees on a parcel of land. It goes on forever.

Every Administration in the UK feels deep frustration at some of the bureaucracy in the CAP. We have an opportunity as we leave the EU to do things differently and to design coherent policy. We set out our intention in the Queen’s Speech last year to bring forward an agriculture Bill later this year. Before that, we will publish further plans about our initial thinking—some time later in the spring or in early summer.

The right hon. Member for Orkney and Shetland and others talked about the importance of UK frameworks. We absolutely recognise that and I think that all other parts of the UK do, too. As he pointed out, when we consider the UK framework, we will be looking predominantly at two areas: first, what is required to protect the integrity of the UK single market. Clearly, we could not have one Administration subsidising sheep farmers in a way that would be to the huge detriment of farmers in other parts of the UK. There would have to be some boundaries. Secondly, everyone accepts the need for UK frameworks when we talk about what is necessary to secure international agreements, be they on trade or other matters: things like phytosanitary, food safety and traceability issues to protect our export market. We will have to have some kind of framework and common outcomes and objectives to deliver those things.

I reassure the hon. Gentleman and others that we are engaging regularly with Ministers in all the devolved Administrations. We have regular meetings with them and in some of those meetings, different devolved Administrations lead on particular aspects. They have been updating us on some of the work that they have been doing. At official level there has been a very in-depth analysis, both to deliver what is necessary for the current European Union (Withdrawal) Bill and for the detailed work on the principles and features that a future UK framework will need.

Picking up on the point that my hon. Friend Colin Clark made, our critique of the CAP is that it is a one-size-fits-all policy, and it does not work for that reason. I want to ensure that leaving the EU and the CAP is liberating for everyone in this country—for all the devolved Administrations and for farmers right across the UK. As he put it, it is not our intention at all to have a DEFRA-centric, top-down policy. Far from it: we want to protect maximum flexibility and ability for each individual devolved Administration to design policies that work for them.

I will give an example of the sort of thing that we have to put up with. About 18 months ago, the Welsh Government got into a legal dispute with the European Commission because the Commission did not like the size and shape of the ear tag that they used as the second tag on cattle. I would have no intention of trying to dictate to other devolved Administrations what the size, shape or colour of their ear tags should be. All I would want to know is that they had proper traceability in place.

Photo of Alistair Carmichael Alistair Carmichael Liberal Democrat Chief Whip, Liberal Democrat Spokesperson (Northern Ireland)

The Minister’s policy is all very well, but it is meaningful only if we have the money to go with it. Will the Minister address the position of the Treasury in relation to funding of it?

Photo of George Eustice George Eustice The Minister of State, Department for Environment, Food and Rural Affairs

The right hon. Gentleman pre-empted me—I was about to get to that point. We were very clear in our manifesto that the budget in cash terms for agriculture policy will stay the same until 2022. My hon. Friend Luke Graham asked the question: I reassure him and other Members that that applies to all parts of the UK. There would be no question between now and 2022 of any devolved Administration departing from that and using those funds for some other purpose—that would be a breach of the manifesto commitment.

As a Government, we have been very clear that we will keep the cash total the same until 2022, but we have given a very clear undertaking that we will seek to phase out over time the single farm payment and to replace it with the new environmental land management scheme, which will be funded. It is not the case that funding will end in 2022; at this stage we have not set out exactly what the figure will be post-2022, but we are absolutely clear that there will be a gradual transition and a funded policy to support our environmental land management scheme after 2022.

I am going to touch very briefly on a few of the areas that we are looking at in England as future policy. For a new environmental land management scheme we want to move away from the current direct payments, which are on an area basis. I do not think there is much sense for that. We want to directly reward farmers for what they do by way of delivering public goods—whether enhanced animal welfare or environmental goods. We want to move to a system where we are rewarding farmers for the goods that they provide. We are also looking at innovation and competitiveness, including the possibility of grants to support investment on farms, to help farmers prepare for a new world in agriculture.

To pick up on the point that my hon. Friend Scott Mann raised, we are looking at whether we can help support and foster the development of futures markets and insurance products to help farmers manage risks. We are looking at issues such as fairness in the supply chain, too.

The right hon. Member for Orkney and Shetland and my hon. Friend the Member for Tiverton and Honiton raised the issue of New Zealand. New Zealand is different: people often forget to take account of the fact that when it removed subsidies, it also devalued its currency by 45% and priced itself back into world markets. In doing that, New Zealand had certain problems with the environment—even today, New Zealand dairy has environmental impacts that we would not want to tolerate in this country. There are differences and there are things that we would not want to follow in the case of New Zealand. There are also things that we can learn—for instance, its support for investments on farms through grants.

I assure the right hon. Member for Orkney and Shetland that I regularly meet with NFU Scotland—I can see its members today in the Public Gallery, carefully watching the debate—and we are very keen to get its engagement; we are not allowing that to be something that just the Scottish Government do. As the UK Minister, I want a UK perspective. My hon. Friend Mr Jack mentioned animal welfare. I agree with him; we have prioritised it and we are looking at ways that we can incentivise and support high animal welfare systems of husbandry. As I said, it is a public good and we recognise it as such.

Kerry McCarthy gave some positive comments on what she has heard so far. I very much look forward to her supporting us in the Division Lobbies as we try to take the Bill forward on that basis. She mentioned the issue of labour; I was formerly a strawberry farmer and I understand the challenges that fruit farmers face. We have been working with the Home Office to discuss what work permit arrangements we might put in place for when we leave. The Migration Advisory Committee has just started a big piece of work to look at the labour market in the round. I agree with what the hon. Lady said about some of the work of the Food Foundation. Horticulture often has been overlooked, and we have an opportunity to address that. I attended the launch of the project that she highlighted.

My hon. Friend the Member for Tiverton and Honiton talked about some of the pressure on the uplands. We recognise that, but I had a very interesting conversation with the Uplands Alliance just last week; it pointed out that although they are financially more vulnerable, it believes that there are more things that they can deliver by way of public goods—whether peatland restoration, flood mitigation work or public access. There are many opportunities for it to do that.

Farmers are the recipients of subsidies, but they are not always the main beneficiaries. Subsidies distort all sorts of markets. We have an opportunity to do things very differently. It would remiss of me not to mention trade with the US. It is difficult to assign the description of “anti-American bigotry” to the Secretary of State, who is quite an Atlanticist, but we recognise and value our high animal welfare standards and we are determined to protect them.

Photo of Alistair Carmichael Alistair Carmichael Liberal Democrat Chief Whip, Liberal Democrat Spokesperson (Northern Ireland) 4:29 pm, 1st February 2018

I thank all hon. Members who have taken part in the debate. I feel that we will return to this subject many times. In particular, I thank the Minister, who has been assiduous in addressing the points; he took copious notes throughout, but despite that, he still managed to send me an email at 3.30 inviting me to a reception to mark Cornish Pasty Week. I accept his invitation with some pleasure and look forward to discussing with him there the importance of protected geographical indications, of which Cornish pasties, Orkney beef and Shetland lamb are but a few.

Motion lapsed, and sitting adjourned without Question put (Standing Order No. 10(14).