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Agricultural Transition Plan
30 November 2020
Lead MP
George Eustice
Debate Type
Ministerial Statement
Tags
EconomyClimateBrexitBusiness & TradeAgriculture & Rural Affairs
Other Contributors: 40
At a Glance
George Eustice raised concerns about agricultural transition plan in the House of Commons. A government minister responded. Other MPs also contributed.
How the Debate Unfolded
MPs spoke in turn to share their views and ask questions. Here's what each person said:
Government Statement
The minister announced the Government’s agricultural transition plan, which aims to shift from arbitrary area-based subsidies towards new payments and incentives that reward farmers for farming sustainably. The plan includes three components of environmental land management: sustainable farming incentive, local nature recovery, and landscape recovery, with a focus on enhancing animal welfare, improving food quality, and increasing productivity. A seven-year transition period is introduced to gradually reduce legacy direct payments while simultaneously introducing new financial incentives for sustainable practices. By 2027, the goal is to have a reformed agricultural sector that balances profitable food production with environmental recovery. The plan also includes grants to support farmers in reducing costs and improving profitability.
Luke Pollard
Lab Co-op
Plymouth Sutton and Devonport
Question
Pollard asks about the sustainability of farming under the proposed changes, specifically questioning why there was no sustainable farming initiative announced for next year. He also inquires if the Secretary of State shares concerns over south-west farmers being forced out of business due to these changes and seeks regional figures on expected farm bankruptcies.
Minister reply
The minister acknowledges Pollard's concerns but does not provide specific regional figures or detailed plans for sustainable farming initiatives for next year. He emphasises the gradual transition period designed to mitigate immediate financial impacts while fostering long-term sustainability.
Luke Pollard
Lab Co-op
Plymouth Sutton and Devonport
Question
I am concerned about the 5% cuts for all, the 50% cuts in three years and the new system not even starting until 2022. Why was no sustainable farming initiative announced for next year, just a 5% cut and no bridge to environmental funding? Why was there so little detail on that and why is there a gap?
Minister reply
First, let me confirm that the policy we set out today is for England. Indeed, most of the powers in the Agriculture Act 2020 were for England. It will be open to the devolved Administrations to pursue their own policy. Even under the common agricultural policy, devolved Administrations had some freedom about the pillar 2 schemes that they could put in place. We will also co-ordinate policy with the devolved Administrations to ensure that there is no disturbance within the internal market. It is the case that over time, albeit at different paces, other devolved Administrations will not want to be shackled to the common agricultural policy that we have inherited, and they will want to take the opportunity to do things better.
Question
I broadly welcome the thrust of these transition arrangements to improve the environment, although as a farmer I am concerned about farming viability—given the phased 50% cut in support over the next three to four years—for those who will miss out on the environmental land management scheme pilots for 5,500 successful applicants, until the new ELM scheme comes in from 2024. The Secretary of State is offering a lump sum exit scheme to encourage farmers to retire and a new scheme for new entrants from 2022, but in view of the high costs of mechanisation and the time to achieve the viability of a new enterprise, does that not risk continuing the process of consolidation of farming businesses into larger holdings, in particular in disadvantaged areas?
Minister reply
My right hon. Friend makes an important point, and we are considering that in the design of our schemes. We are working with county farms across the country to improve the offer that county farms have, to create opportunities for new entrants and to encourage them into partnership with other landowners so that there can be more opportunities for those new entrants and to create an incubator model for these new entrants.
Question
I see the headlines of stories that the Government have planted today promising that Brexit will transform our fields and farms. One would have to agree, although that transformation will not only be in ways that many in agricultural areas will necessarily welcome. The speed and scale of the reductions proposed worry many others, including, it seems, the Minister’s own colleagues, with the head of the National Farmers Union describing the Government’s approach as 'high risk and a very big ask'. Lack of clarity on the detail of the replacement environmental land schemes remains a big concern for agricultural and environmental representatives alike. It seems to me that what qualifying criteria we have been made aware of could lend themselves equally well to shooting estates as to hill farmers, for example. I would be grateful if the Secretary of State could enlighten us further on that point.
Minister reply
It is the case that England is a long way ahead of Scotland in terms of developing future policy. We want to take the opportunities that come from leaving the European Union to chart a different course and put in place a policy that makes more sense. Our view is that arbitrary area-based subsidies for people based only on the amount of land that they own or rent makes no sense in this day and age, and we should be directing those funds in a different way.
David Mundell
Con
Dumfriesshire, Clydesdale and Tweeddale
Question
As it is St Andrew’s day, it would be remiss not to highlight the excellence of Scotch beef, lamb and other agricultural products. The Secretary of State said that the measures he has announced will not apply in Scotland. Does he agree that the Scottish Government should now get on with devising a bespoke support scheme for Scotland to take into account our unique geography and climate—for example, continuing with an enhanced less favoured area support scheme—rather than pursuing an independence agenda, which would disrupt Scottish farmers’ biggest single market: the rest of the UK?
Minister reply
My right hon. Friend makes an incredibly important point. When the current incarnation of the common agricultural policy was put in place, NFU Scotland was very clear that area-based payments could not be made to work properly in Scotland. It is difficult therefore to see the justification for maintaining a policy built solely on area-based payments, given the large variance in land types. I agree with him that the Scottish Government should, in line with all other parts of the UK, take this opportunity to do things differently and to do them better.
Tim Farron
Lib Dem
Westmorland and Lonsdale
Question
British farming genuinely is the best in the world, fundamentally because of the family farming unit upon which it is based. The Government’s plan to deliver environmental goods through the environmental land management scheme is good and laudable, and we support it. However, the transition whereby, in a revolutionary way, people will lose half their income in three years’ time—when the average livestock farmer is reliant on basic payment for 60% of their revenue—will lead to hundreds upon hundreds of those family farms going out of business and therefore not being in a position to deliver those environmental goods by 2028. The landscape of the Lake district and the Yorkshire dales is shaped by centuries of family farming. By accident, the Government could undo all of that in a few short years—even months—so will the Secretary of State think again, not penny pinch, and make sure that the basic payment is rolled over in full until the point at which the environmental land management scheme is available for everyone?
Minister reply
The concept of area-based payments has only been around for about 15 years, and it has not always been in the interests of agriculture. The truth is that farmers may be the recipients of the BPS, but they are not the only beneficiaries: the BPS payment has inflated land rents and input costs, prevented people from retiring, and also prevented new entrants from getting on to the land. That is why we believe there is a better way to pay and reward farmers in future.
Question
I believe that replacing the common agricultural policy with these reforms will help us to achieve crucial goals on protecting nature and the natural environment, and to improve animal welfare—things our constituents really care about. I want the Secretary of State to also confirm today that another crucial goal of these schemes will be food security, and ensuring we are supporting people to make a living from growing food.
Minister reply
Let me commend the role that my right hon. Friend played in the development of this policy and, indeed, some of the changes that were introduced in the latest incarnation of the Agriculture Bill. During her time in this post, she was passionate about the importance of food security and the financial viability of our farms.
Carla Lockhart
DUP
Upper Bann
Question
The Secretary of State will be aware that farmers need time to transition to a new system. He will also be aware that over 100,000 people are employed in the agrifood sector in Northern Ireland, and therefore direct support to farmers is vital. Will he give assurances to UK farmers that the Government will fund agriculture appropriately, to ensure we deliver a productive, profitable and sustainable farming business model for generations?
Minister reply
Since agriculture is devolved, it will be for Northern Ireland, the Northern Ireland Executive, and the Department of Agriculture, Environment and Rural Affairs to develop a policy that is right for them. However, I can confirm that we have maintained the budget for every part of the UK at the point at which we left the EU, and we will maintain that for every year of this Parliament. For Northern Ireland, that equates to £330 million per year.
Question
I thank my right hon. Friend for his statement. Will he outline the importance being placed on flood mitigation in the environmental land management scheme, and urge the Welsh Government to adopt similar measures to help protect communities such as St Asaph and Rhuddlan from flooding?
Minister reply
My hon. Friend makes an important point. We will be looking to use the powers in the Agriculture Act to make provision to support and financially reward farmers who may allow their land to be used in certain water catchments to protect communities from flooding—a nature-based solution to that flood risk, as it were. We will also be using this money to support improvements in water quality by supporting an expansion of catchment-sensitive farming.
Andrew Gwynne
Ind
Gorton and Denton
Question
I welcome the emphasis on ensuring that farm subsidies in the future encourage animal welfare, environmental sustainability and nature recovery. However, given that this new policy will see income for some farms fall by 50% over the next three years, what assessment has the Secretary of State made of the numbers that will be impacted by these changes, and what opportunity is there in the nature recovery initiative he has outlined for those with marginal farm holdings, often in the urban fringes, where the land now has more of a recreational and environmental benefit than an agricultural one?
Minister reply
It is the case that some of those lands that are in more marginal areas, where it is less productive, will see more opportunities to access local nature recovery, and in some cases even landscape recovery, to get some significant support from the Government for either land use change or making more space for nature on their land. Some of those upland and more marginal areas will be able to get access to the scheme.
Question
I am pleased to hear from my right hon. Friend that there will be a period of engagement with farmers, landowners, managers and other key stakeholders in Cheshire before finalising the detailed design and operation of this fairer farming system. To that end, will my right hon. Friend tell the House what economic impact assessment his Department has done to help inform these significant and potentially transformative policy decisions?
Minister reply
My hon. Friend makes a very important point. We are looking at this matter. We believe that by removing the area-based subsidies, there could be some adjustment in land rents to reduce costs for farmers. Through the changes that we are making in the supply chain, it could also be the case that farmers will have a fairer share of the value for the food that they produce.
Question
The Secretary of State knows that I believe him to be an honourable man, but he is a member of a Government who are now notorious for their chumocracy and favours for friends. What he is ushering in today is a charter for City slickers, carpetbaggers and spivs to take over our farming sector, and to drive out the traditional smaller English farmers, who have been feeding our nation for so many years. Will he please think again before he eradicates the good English farmer?
Minister reply
The hon. Gentleman has a habit of starting off by suggesting that he is going to pay me a compliment, and things go downhill quite quickly thereon. The area-based subsidy that we currently have has a habit of giving the largest payments to the wealthiest landowners. Sometimes these are people who are not really actively farming.
Question
My right hon. Friend has said that he hopes that this plan will encourage new entrants of people trying to get into farming. Will he briefly outline in what way it will be different from what happens now?
Minister reply
All the studies that have been done on this issue have shown that the single most important thing that we can do to help new entrants on to the land is to help those who perhaps should retire, or those who want to retire, to retire with dignity, so that more holdings come on to the market, land rents adjust to a sustainable level and there are opportunities for new entrants.
Question
A recent poll from AgriScot’s online annual event has shown that 75% of Scottish farmers now oppose Brexit. That is hardly surprising, given the harm, disruption and uncertainty that Brexit has caused the agricultural sector. Does the Secretary of State understand why so many have now turned their backs on his Government’s flagship policy, and does he understand the need for this Government to listen to their concerns?
Minister reply
Agriculture policy is devolved, so Scottish farmers are not turning their backs on the policy that I have announced today for England. Perhaps the lack of enthusiasm is because of the failure of the Scottish Government to show leadership in this area.
Question
Earlier this year I was fortunate enough to visit Hobkin Ground farm in my constituency, which is actively pursuing regenerative farming and trying to reduce the carbon footprint of raising a cow from field to fork through measures such as new grasses. What assurances can my right hon. Friend give to farmers like Megan and Mark that the new environmental management scheme will help us to help them meet our stringent net zero targets?
Minister reply
My hon. Friend makes an important point. We are looking at a number of different disciplines within regenerative farming, including methods such as mob grazing, the use of different types of leguminous nitrogen-fixing plant mix in grassland and reduced fertiliser use. If we manage grassland and soils correctly, they can be a really useful store of carbon and contribute to net zero.
Diana R. Johnson
Lab
Kingston upon Hull North and Cottingham
Question
Food poverty in my constituency is already a huge issue. Will the Secretary of State guarantee that under the new agricultural transition policy we will not see higher food prices for working families who are only just managing?
Minister reply
We think that the policy will lead to stable food prices, but also to a situation where we change the way we reward farmers from occupying land to farming their land in a nature-sensitive and animal welfare-enhancing manner.
Neil Hudson
Con
Epping Forest
Question
Will my right hon. Friend assure the farmers and land managers in my constituency and throughout the UK that when the direct payments scheme ends, the new way of funding will be secure and long term, so they can plan accordingly?
Minister reply
Yes, the Agriculture Act 2020 sets out clear objectives on animal health and welfare as well as environmental goals. The public supports improvements in these areas.
Question
When will farmers be given details of what a competitive rate under the ELM scheme is, so that they can start to plan for the future?
Minister reply
We will consult on the design of the sustainable farming incentive in the first half of next year.
Alistair Carmichael
Lib Dem
Orkney and Shetland
Question
By what means will future budgets for the scheme be fixed, and how will disputes be resolved?
Minister reply
The Government will keep the budget for each part of the UK the same in cash terms for every year of this Parliament.
Question
Will he explain how ending bureaucracy and unnecessary form-filling is going to help to ensure that all our farmers are exactly where they need to be, which is on the land?
Minister reply
Under the current common agricultural policy, there are rules about gateway width, hedge dimensions, and crop treatment that make no sense. We will sweep away these unnecessary rules.
Question
Can he guarantee that the Government will not use powers in the Bill to prevent the Scottish Government from pursuing their own agenda on issues related to standards or state aid?
Minister reply
When it comes to setting standards around animal welfare, those matters are devolved now and will remain devolved.
Question
Can I draw him on the funding? We welcome that commitment in Wales, but my farmers have long dealt with the modulation from pillar 1 to pillar 2 in Wales, which is 50%: the highest in the United Kingdom.
Minister reply
My hon. Friend makes an important point. The Welsh Government will probably strike a similar approach to that which we are taking in England.
Question
Cutting income payments by 50% over a period of three years, starting in January, is not evolutionary but revolutionary. On consultation, there are plenty of voices out there at the moment expressing real concern about the future of local farms.
Minister reply
We will be cutting the payments that go through the rather dysfunctional legacy basic payment scheme and directing that money into new schemes including the sustainable farming incentive.
Kevin Hollinrake
Con
Thirsk and Malton
Question
Will the Secretary of State commit to looking after the interests of hill farmers in Thirsk and Malton and consider delegating the distribution and administration of moneys direct to the national parks?
Minister reply
There will be opportunities for upland and moorland areas to benefit from a new policy that is based on payment for the delivery of environmental goods, alongside their food production.
Jim Shannon
DUP
Strangford
Question
What discussions have taken place with the devolved Northern Ireland Assembly to ensure that this transition will be applicable—and therefore funded—UK-wide?
Minister reply
The Northern Ireland Executive and DAERA will make their own decisions, but they are likely to depart from the legacy schemes in a more cautious fashion due to proximity to the Irish Republic.
Jerome Mayhew
Con
Broadland and Fakenham
Question
While I warmly welcome the thrust of the plan, will my right hon. Friend confirm that the Government remain committed to increased food security and how this plan will help farmers maintain or increase food production?
Minister reply
We are absolutely committed to domestic food production for our food security, with a review every three years.
Tonia Antoniazzi
Lab
Gower
Question
The Secretary of State continues to say that he has maintained the budget for the devolved nations. However, farmers in Wales will be £95 million short compared with if they were still in the EU, due to what would have been a crossover of the programme. Will the Secretary of State back up the promises that he has made to farmers and rural communities in my constituency of Gower and across Wales?
Minister reply
The confusion on this stemmed from the fact that the EU budget runs on a cycle called n+3, where n is seven years, so effectively, the EU budget is across a decade. The budget that we have announced is across a Parliament and we have guaranteed the same in each year. A typical spending review cycle is five years. We cannot compare a 10-year EU budget with a five-year UK one that will be renewed at the end of that. The reality is that we have set a favourable exchange rate that is 22% higher than before the referendum result, and that benefits farm incomes.
Question
To enable farmers to access new markets and to obtain fair prices for their high-quality UK-reared-and-grown produce, both at home and abroad, there is a need for investment in food and drink processing facilities. I would be grateful if the Secretary of State could outline the strategy for securing this.
Minister reply
Our paper today outlines plans for a farming investment fund. That can include small grants to support the deployment of new agricultural technology and larger grants—transformation grants—that could support adding value through food processing facilities on farms, but also for groups of growers or producers to come together and collectively invest in such a way.
Question
We know that the Tories have already broken a manifesto promise on matching EU funding and that it is going to cost Scotland £170 million, but we have real concerns that the Government are going to use the United Kingdom Internal Market Bill to prevent the Scottish Government from providing the right level of support for Scottish farmers. Can we get absolute clarification that the Tory Government will not use the Bill to block any devolved policies?
Minister reply
I reject the hon. Gentleman’s claim that the budget is not what was promised. We promised to maintain the budget in each part of the UK in cash terms at the juncture where we left. That is exactly what we are doing. It means that Scotland will receive £595 million per year, 22% higher than it would have received had we used the exchange rate at the start of the last EU programme.
Danny Kruger
Reform
East Wiltshire
Question
Can my right hon. Friend reassure farmers in Wiltshire that food production will still be supported under the new scheme and that they will not be undercut by farmers, including in the devolved nations, who are subsidised for food production or by area, not just for stewardship?
Minister reply
I can give my hon. Friend that commitment. The aim of this policy is very much to support and reward farmers for farming more sustainably, but the emphasis throughout is on sustainable food production, not on taking land out of production.
Jamie Stone
Lib Dem
Caithness, Sutherland and Easter Ross
Question
In his statement, the right hon. Gentleman made mention of the production of high-quality food in “a sustainable way”, and I say amen to that. The reputation and quality of British farm produce is second to none—it is a world beater—so will he consider having a discussion with the devolved Administrations with a view to setting up an agency to promote British farm produce for export, thereby earning money for the Exchequer of our United Kingdom?
Minister reply
The hon. Gentleman makes a very important point. We do work with the devolved Administrations on the design of future policy. There will be a co-ordinating group on future policy. We also work with all the levy bodies through the Agriculture and Horticulture Development Board, and the devolved equivalents of those, on a joint approach to marketing our fantastic food and produce around the world.
Damian Hinds
Con
East Hampshire
Question
It is right that the equipment and technology fund and the transformation fund should focus on core agricultural business and productivity, but can my right hon. Friend also reassure me that his Department will continue to support farm diversification?
Minister reply
My right hon. Friend makes a very important point and I can confirm that that will be possible. We made some changes to the Agriculture Bill that was brought through this Parliament to ensure it could support farm diversification projects to help farmers add value.
Matt Western
Lab
Warwick and Leamington
Question
Many farmers in my area of Warwick and Leamington and the villages around are really concerned. As far as they are concerned, they are in business—they have been farmers for generations to look after and steward the land, but also to look after their herds and to produce the grain and crops that we depend on. Their real concern is to do with livestock, where 80% of their income has come from the BPS—basic payment scheme—payments. They see the proposed changes as being all about preserving a landscape, not about preserving food resilience and their businesses.
Minister reply
It is important to note that since the advent of area-based payments the subsidy payments have been totally decoupled from production. Indeed, had we had our time again a better way to have done it might have been to introduce conditionality to the old payments that were there before. It is already the case that there are people who own a plot of land and claim on it but who are not actually producing food. The logic of our policy today is to focus the payments towards what farmers do with the land, not just dole out money based on how much land they own.
Question
The chalky soils of the Meon Valley are very different from the peatlands of the Derbyshire dales, so how will my right hon. Friend ensure that farmers in all areas are incentivised to improve soil quality, for sustainability as well as for farming?
Minister reply
My hon. Friend makes an incredibly important point. We made an explicit change to the Agriculture Bill in this latest incarnation to ensure that soil health was recognised as a public good. Different soil types need different approaches and different treatments to bring them back into health. We are working with a number of stakeholders and universities now to establish how best to manage and measure soil health on a range of different soils, and we will have incentives in place to support that endeavour.
Question
While this statement refers to the future of English policy, what future does the Secretary of State see for Welsh farming following the shortfall of a third in Welsh agricultural support, which revealed itself in last week’s comprehensive spending review? This is labelled by the Welsh farming unions as a Brexit betrayal.
Minister reply
As I have said several times, we do not recognise the caricature that the budget has been cut. We were clear that we would maintain the budget in cash terms for each year of this Parliament. That is precisely what we have done.
Question
I very much welcome what the Minister has had to say about the restoration of peatlands, but can he go a little further in terms of the natural environment? Does he guarantee that there will be less use, for example, of phosphates and therefore less phosphate run-off? Does he guarantee that we will see no return to the use of the pernicious neonicotinoids that are so damaging to our pollinators, which are so necessary to our agriculture?
Minister reply
As we have outlined in the paper published today, we want to incentivise farmers to embrace integrated pest management. Across the piece, we are likely to see reductions in the use of synthetic chemistry and the adoption of other processes to tackle the problems of pests and diseases.
Richard Fuller
Con
North Bedfordshire
Question
I thank my right hon. Friend for outlining the principles and programmes for these changes in payments. As he will be aware, however, it will be in the implementation of those programmes and the inspection of those schemes that issues will appear. Farmers will have worries about the implications of not changing, transitioning and falling in accordance with the new plans. What reassurance can he give to farmers about how implementation will take place?
Minister reply
I can reassure my hon. Friend that I am alive to that danger. When introducing any new scheme, it is critical that we do not over-engineer its design and that we tack towards simplicity to make sure that things are deliverable. What we want to do on this new scheme is move away from the endless form filling, endless mapping, and arguments over maps, and instead get to a position where a trusted adviser or agronomist walks the farm with the farmer, sits down around the kitchen table and helps them put together a plan that is right for their farm.
Question
Farmers in Scotland are likely to face a funding loss of £170 million compared with what the Tories promised in their manifesto. This will undermine the crucial delivery of promises to meet climate change and biodiversity challenges. Why should I believe that the Minister is right and that the president of the NFUS is wrong?
Minister reply
The confusion arises from comparing a seven plus three year—10-year—EU budget with a five-year parliamentary term for the current budget, which are different timescales.
Greg Smith
Con
Mid Buckinghamshire
Question
With farmers facing uncertainty due to weather conditions leading to a particularly poor 2020 for many, when will the detail of the sustainable farming incentive and other bridging schemes come forward so that farmers can have certainty as they plan for the future?
Minister reply
More papers on scheme designs, including the voluntary exit scheme and the sustainable farming incentive, will be published in the new year. The consultation on the design of the sustainable farming incentive will take place in the first six months of next year.
Shadow Comment
Luke Pollard
Shadow Comment
The shadow criticises the minister's announcement, highlighting concerns about significant cuts to farmer subsidies leading to unviable businesses for many small English farms. He questions the lack of detail on sustainable farming initiatives for next year and expresses concern over potential farm bankruptcies in regions like the south-west due to changes proposed. Pollard also raises issues regarding food imports from countries with lower standards and the impact of trade deals on British farmers, urging the government to provide more support for family farms.
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