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Update on Defra sectors

Department for Environment, Food and Rural Affairs written statement – made on 21st April 2020.

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

Coronavirus presents unprecedented challenges to the businesses we rely on to provide essential services which keep people safe – including food supply, water and waste.

Many businesses in these sectors have benefited from Government schemes to support all businesses, including the Coronavirus Job Retention Scheme, Coronavirus Business Interruption Loan Scheme, and the Small Business Grant Scheme and support for the self-employed.

Beyond this, the Government has taken specific action to support the food, farming, water and waste sectors in the delivery of critical services.

  • Fisheries: The fishing sector has seen considerable impacts because of the closure of restaurants both here and in Europe and severe market disruption. Last week we announced a new £10 million support scheme to help the catching and aquaculture sector in England and boost local supply chains. Vessel owners and aquaculture businesses will receive payments to help cover their fixed costs. On Monday we began to contact eligible vessel owners. The MMO has published the details of the scheme on gov.uk.

  • Dairy: In particular, the dairy sector has felt a significant impact as a result of the coronavirus pandemic. Between 5 and 10 per cent of total milk production goes to the food service trade and there is therefore a small proportion of milk production that currently has no home. The vast majority of Britain's 10,000 dairy farmers continue to supply their contracts at the usual price and larger processors have been largely unaffected by the market disruption because of their scale and diversified nature. In order to support the affected farmers, on Friday we announced that we will set aside some elements of competition law to make it easier for processors to come together and voluntarily work out how to ease production down in order to create the space in the market for that milk that currently has no home and to support a recovery in the spot price. We have asked the Agriculture and Horticulture Development Board (which supports the interests of dairy farmers and the wider farming industry) and Dairy UK (which represents the processors) to coordinate a proposal and discussions are already underway.

  • Livestock: There has been a drop in demand in various cuts, for example steaks, leading to carcass balance problems in the beef, poultry meat and pig meat sectors. We have encouraged supermarkets to put steaks on promotion and, while the price of beef cattle has reduced in recent weeks, retailers are also reporting an increase in meat sales. Although the price of beef cattle, poultry and pigs has dropped, it still remains higher than in previous years. Quite a lot of beef, poultry meat and pig meat has gone into storage so we continue to monitor this market closely.

  • Waste: The waste sector has been impacted by social distancing, staff shortages and an increase in waste produced by households compared to a decrease in demand for commercial collections. Defra has published guidance to local authorities to help them prioritise their waste streams to keep important services like black bin bag collections moving, and worked with the waste sector to develop an online platform called WasteSupport which facilitates the sharing of resources between local authorities and commercial operators. This was launched by the sector at the end of last week. We are looking at how we can keep other services operating such as household waste recycling centres, and are aware of reports of increases in fly-tipping.

  • Supermarkets: following a significant spike in consumer demand, we have now seen stock levels in supermarkets improve and panic buying has stopped. To support the food sector, the government temporarily relaxed competition law and regulations relating to driver hours and delivery times so that the sector could work together to keep putting food on the shelves.

  • Ornamental horticulture: the closure of garden centres has had an impact on some specialist plant producers in the ornamental horticultural sector. Online sales have been able to continue and the Government is keeping the situation under review but concluded last week that it was too early to ease any restrictions on such retail environments. The First Secretary set out the five tests on which the Government would base any assessment of easing the current measure. We must all continue to stay at home, in order to protect the NHS and save lives.

The Government will continue to support these essential services; I want to thank all those who have rallied in an extraordinary way to respond to this unprecedented challenge.

This statement has also been made in the House of Lords: HLWS188