PARLIAMENTARY DEBATE
Agricultural Transition Plan - 26 January 2023 (Commons/Commons Chamber)

With permission, Mr Deputy Speaker, in addition to the written ministerial statement tabled today, I would like to make a statement updating the House on the next steps that we are taking to shake off the damaging legacy of the bureaucratic EU common agricultural policy for good.

We will learn from the past, and help farmers to build and maintain profitable and resilient businesses by spending public money in a way that helps us to secure the public good, so that they can continue to produce the food we need and help to improve the state of nature. That is the right and smart thing to do with public money, as we also develop the markets that will draw on finance from all sources. Today we are publishing detailed information about what we will pay for in our environmental land management schemes, and how farmers can get involved this year and beyond.

Having kicked off our sustainable farming incentive last summer starting with soil health, today we are adding six more ways that farmers can be paid to take action in 2023, from protecting and enhancing the hedgerows that make up a vital network of habitats across our farmed landscapes, to making sure that we tackle pests, protect crops and support wildlife, so that more farms of all shapes and sizes can make doing their bit for the environment part of their business plan. Each year, we will add offers to the SFI, with the full set in place by 2025, so that farmers can choose more options for their businesses. That is vital for producing food, tackling the causes and impacts of climate change, and helping nature to recover.

We are making it straightforward and simple to get involved. We know that farmers need to plan for the months and years ahead as early as possible, so today we are publishing information on the work we will be rewarding by 2025 through the sustainable farming incentive and countryside stewardship, and sharing information on the next round of landscape recovery projects. We remain as ambitious as ever, as we move ahead through our transition and work with farmers to design a much better way of doing things.

All that will help us to build the resilience of our communities and to meet our environmental targets on air, water and waste, as well as nature, land and sea, guided by our commitments to reach net zero by 2050 and halt the loss of species in our country by 2030. We are also tackling the polluters who stubbornly refuse to help and threaten to undermine everyone else’s hard work. Our aim is to back the frontrunners who can have the greatest impact and inspire others, as well as helping everyone to bring up their baseline and improve it year on year, harnessing the power of innovation and technology to help our farmers give nature a helping hand so that we focus on bringing their businesses into the future.

All the evidence we have, as well as plain common sense, tells us that making the shift towards a more sustainable, resilient food system is critical to feeding our growing population and meeting our commitments to halt the decline of nature by 2030 and reach net zero. That will fundamentally improve the lives of people across our country and around the world, and make sure that every generation has a better future. The UK will continue to lead the way. I am sure that the whole House will join me in recognising the vital importance of the solutions our fantastic farmers bring to the table. I commend this statement to the House.

I call the Opposition Front-Bench spokesman, Daniel Zeichner.

I thank the Minister for advance sight of the statement. It provides detail following announcements made not to this House, Mr Deputy Speaker, but to the Oxford farming conference some weeks ago. It will be scrutinised closely as farmers rightly try to work out what it will mean for them. With intense cost pressures on fertiliser, fuel and labour supply, many people are hurting and worrying. At the same time, the reduction in basic payments moves inexorably onwards. For people on the margins, especially in the uplands, the withdrawal of that essential support will make life harder and harder. Next year, half of it will be gone and the value of the other half will be eroded substantially by inflation.

So what is on offer today? Not nearly enough, I am afraid. There are more than 100 pages of complexity. There are lots of schemes, which are worthy in themselves, but in far too many cases, I fear they will be insufficiently attractive. There is a risk that take-up will be very low, as we have seen with the SFI so far, with just 224 paid out last year, compared with the over 80,000 receiving basic payments. I hope take-up improves—we want these schemes to work—but we have real doubts. Will the Minister tell us how much of the £1 billion already cut from farmers will go back to them this year through environmental land management schemes? How many people does he expect to take up the SFI in this calendar year? I welcome the reference to tenant farmers, but can he guarantee access to those schemes, because he will be aware of the issues highlighted in the Rock review?

There are also real questions about the environmental benefit. In the absence of a whole-farm approach, there is real risk, particularly on countryside stewardship, that the Government will pour money out to people to do pretty much what they already do and then intensify alongside that. Will the Minister tell us today what measures of environmental improvement are in place to ensure that public goods are really being secured in return for public money? Crucially, what impact does this all have on our food security? Will he tell us today whether we produce more or less food in this country this year as a consequence of these changes?

It is fully three years since we discussed the Agriculture Bill in Committee. I asked many of the same questions then and got vague answers. We will soon be halfway through the so-called transition. The Government have been good at cutting the funding to hard-pressed farmers, but frankly woeful at guaranteeing our food production here in the UK and enabling the switch to the more sustainable nature-friendly food production system we all want to see.

I honestly entered the Chamber with optimism. I thought today was the day we would get a positive Opposition able to join the people up and down the country who are being positive about this. I am sure the hon. Gentleman is disappointed we have had positive comments from non-governmental organisations and farming organisations, which seem to be welcoming the plans.

Let us get to the points the hon. Gentleman made. He said we made announcements at Oxford, but what we announced at Oxford was the lifted payments for countryside stewardship. Today we are announcing the SFI, which is the other scheme. That is on the website now. There are six extra schemes in there, some of which—the low-input grassland and improved grassland schemes, for instance—are designed to help and support exactly those upland farmers he mentioned. There is also support through countryside stewardship to assist with the maintenance of stone walls, so there are lots of things for farmers to embrace.

The hon. Gentleman asks: can we do both? Can we keep the nation fed and improve the environment? We have full confidence that we can. Looking at the data and at history, this country gets about 1% more efficient year on year in the way we produce food. That means that in 10 years’ time we can produce the same amount of food on 10% less land. I think we can do better than that. With investment in new technology, we can be more productive on the most productive land, and on the margins around those fields we can add true biodiversity and environmental output.

Let me give a practical example. If we convince farmers not to cut their hedgerows in August or September, as was traditional, but encourage them to cut them in February, that would provide a huge pantry of berries for small birds to feed on throughout the winter. Combining that with support for wildflower strips next to the hedgerows would encourage the development of lacewings and ladybirds, which eat aphids, which are the pests farmers use pesticides on to stop the damage to their crops. That would be a win-win by working with, not against, nature. That is what we want to encourage farmers to do, and that is how we will deliver food security, environmental benefits and better biodiversity.

I warmly welcome the inclusion of a new hedgerow standard under the sustainable farming incentive, and particularly the inclusion and recognition of Cornish stone hedges within it. Hedges are probably the single most important ecological building block in our farmed environment, and it is right that that is recognised.

However, to get the movement we need toward our 2030 species abundance target, we need widespread participation in the schemes, as the document published today outlines. It is very welcome that the Government have increased the payment rates already, but can he confirm that if we need to increase them further in the years ahead to get the participation rates we need, he will not be banned by antiquated EU laws around income forgone—those are still sitting in retained EU law—and that we will pay whatever it takes in the market to get the participation we need?

First, I pay tribute to my right hon. Friend, who was the forerunner of many of these thoughts and schemes. The work he did in the Department has led us to this point, and I pay tribute to it. He is right to identify hedgerows as the corridors of wildlife. They are a huge source of biodiversity and a place where wildlife can thrive. We will, of course, do all we can to not only support individual farmers, but build that network of hedgerows and those corridors for wildlife.

All these schemes remain under review. One of the reasons we are here today and were not able to do this last year is because we were running pilot schemes with farmers and listening to the feedback they were giving us. The scheme we have today is in a much stronger place than it would have been if we had acted earlier. We will continue to have dialogue with NGOs and farmers to ensure we get the outputs we require.

We obviously welcome the aims and objectives of today’s statement, but it has been a tough year for farmers, with cuts to their basic payment alongside the increasing cost of doing business. My farmers tell me that the SFI schemes are too complex and cost too much up front to engage with. That is why we have seen such poor take-up rates so far. Will the Minister consider halting the cut to the basic payment scheme until our farmers have had time to get to grips with the complexities of this new scheme and participation rates have increased to an acceptable level?

We should be clear that we set out our plan to reduce basic payments over a seven-year period and we are trying to ensure that, as those basic payments come down, we increase the environmental payments at the same rate, so that we maintain the same budget. The hon. Lady is fair in her criticism that some of the schemes appeared to be too complex. We have listened to that, and the schemes we are announcing today are much more simplistic in their approach and much more flexible in their delivery. I encourage farmers in her constituency in Shropshire to take a new look. This is a new approach, which builds in flexibility, particularly for tenant farmers, to step in and out of the SFI, and I sincerely hope that her farmers will be able to benefit from the new schemes announced today.

I call the Chair of the Environment, Food and Rural Affairs Committee.

As a farmer myself, I thank the Minister, following the taster that we had at the Oxford farming conference, for his further clarification of the way that agricultural transition will be delivered. We are now able to capitalise fully on the freedoms we have outside the European Union to tailor our agricultural policy not only to the needs and objectives of farmers, but to the objectives of taxpayers.

English agriculture is very diverse in land type, topography, altitude and size, with many smaller farms relying on the support they get from the taxpayer. Can the Minister reassure me that this support system will not only help those farmers who need to change the way they farm to make it more sustainable and ecologically diverse, but support those upland farmers in places such as the North Yorkshire moors who have been delivering for generations exactly the public good that we want them to deliver?

I join my right hon. Friend in declaring my interest, and I pay tribute to him for his work as Chair of the Select Committee and the scrutiny that he brings to this area of government. He is right to highlight the uplands. In these schemes, we have something for everyone. Whether someone is a small livestock farmer in the uplands or a huge arable farmer in the lowlands, there is something that they can engage with to improve their business and improve the biodiversity and environmental output of their farm. Of course, some of the SFI criteria we have put in place—particularly those regarding improved grassland and low-input grassland—are aimed specifically at sheep farmers to ensure that there is something they can participate in. I do not underestimate the economic value of the food they produce, or the impact they have on the tourism industry and on the mental health of people visiting that part of Yorkshire to unwind and enjoy the great landscapes that those farmers have created.

I thank the Minister for his statement and welcome the intentions of this policy. He said that the scheme would be open to all farms of all shapes and sizes. In County Durham we have a lot of tenanted smaller farms. As the hon. Member for North Shropshire (Helen Morgan) just said, a lot of them are struggling at the moment with diesel and fertiliser costs, and other things. Some of these decisions will need investment up front. Will there be any incentives or help for smaller farmers to make that investment? They will also need guidance; big agriculture businesses will have that already, but smaller farmers will need specific help.

I thank the right hon. Gentleman for his question. We have taken a number of things into account. Under the SFI, we have introduced a management payment of an extra £20 per hectare on the first 50 hectares, which will help smaller farmers who do not have the capacity in their business to employ a land agent, so that they have time to go into the agreement and are rewarded for doing so. That is very important.

The flexibility in the SFI scheme also helps tenant farmers. If they enter a scheme and, for some reason, they lose control of their land—if they are removed by their landlord or want to give it up, for example—they will not be penalised for leaving the scheme; they will have the flexibility to come in and out. I hope that helps tenants. We have engaged extensively with the Tenant Farmers Association, and the right hon. Gentleman may be familiar with the Kate Rock review, which looked specifically at the needs and desires of tenants. We have taken on board lots of those recommendations and built them into the scheme.

I thank my right hon. Friend for his statement—what a blessing it is to have someone who knows so much about farming at the Dispatch Box—and in particular for his emphasis on food security, which, as we can now see, has been too neglected for too long. It is clear from the current food price inflation and shortages in the shops that we need better food security. Perhaps he would like to visit the area of outstanding natural beauty around Dedham Vale, where we see good landowner co-operation and work by combined forces. Perhaps he would also like to contact Mr John Geldard, who is leading a highly innovative co-operative scheme in Cumbria. Agri-environmental schemes can work at scale across many estates, and can be far more effective and far better value for the taxpayer than other schemes.

I would be delighted to visit both locations—I have known John Geldard and his son Richard for a number of years. My hon. Friend has drawn attention to co-operation between farmers. The third scheme that we are announcing is landscape recovery, which will involve huge projects over many hectares, with farmers and landowners coming together to contribute a positive environmental output. For example, if we want to reduce phosphate levels in the river Wye—this is an existing scheme—landowners can co-operate to reduce the input of nutrients. We will extend that to a further 25 schemes, subject to the quality of the bids. I am quite excited about it, and I think that non-governmental organisations, landowners and farmers will want to get together and deliver on the landscape recovery scheme.

I do not know what is going on in Sherwood and Sherwood Forest these days, but my local farmers in Huddersfield and I have been involved with the nature recovery network, and I am also a trustee involved in a scheme relating to John Clare’s house in Lincolnshire. We know what it means to deliver public good: it means participation, involving the local community, parish and other councils, and charities. Is not the current problem the fact that no one really knows whether there will be serious money and resources for this plan, or whether people will still be required to co-operate to achieve it?

That is what today is about. It is about the announcement of that money and those schemes that can allow the farmers in the hon. Gentleman’s constituency to gain the reward for the public good that they deliver. This is not only good for the environment, but good for farming businesses. The soil standards, for example, help the farming operation and ensure that we have good-quality soils not only for this generation, but for generations to come.

Farmers in my constituency are passionate about supporting their environment and raising their livestock in a sustainable way, and will welcome the clarity of today’s announcement. Many of them took part in pilots for these schemes. However, they report being unable to apply for the slurry infrastructure grant. Given the importance of water quality in North Devon’s rivers and on its beaches, will my right hon. Friend please ensure that this vital support is accessible to all its farmers?

My hon. Friend has already lobbied me on this in private, and I pay tribute to her. It is important for us to help farmers on the journey towards improving their environmental impact, and that will include grants for new slurry systems and other infrastructure. There will be several rounds so that farmers can apply on several occasions. Today we are announcing a number of future grant schemes in order to give farmers time to think about them and plan for their businesses into the medium future.

I welcome the Minister’s statement, and I think that all of us in the farming sector can take some encouragement from it. I should also declare an interest, as a farmer and a member of the Ulster Farmers’ Union.

The farming industry plays a key role throughout the United Kingdom of Great Britain and Northern Ireland, notably in my constituency, where, as a landowner and a farmer, I understand the importance of retention. In England farmers will receive sustainable farming resources to maintain incentives for a production agriculture sector, but in Northern Ireland, through the Department of Agriculture, Environment and Rural Affairs, agriculture is devolved, at a time when there is no working Assembly. Can the Minister assure us that the devolved nations will not be left behind when it comes to farming incentives, given that their contribution in Northern Ireland is every bit as important as the contribution in the rest of the United Kingdom?

As the hon. Gentleman identifies, these are devolved matters. I am sorry that the scheme does not apply to his constituents, but we have a lot of engagement with the devolved Administrations, some of which are going in a slightly different direction. In those conversations we all recognise that we have to go in a direction that improves our biodiversity and environment. We will continue that dialogue to help support our friends and colleagues in the devolved Administrations and their constituents.

I declare my interest, as my parents are farmers and I previously worked as a rural practice surveyor. I welcome the statement and congratulate DEFRA on listening and making changes. It is worth noting that Janet Hughes, who is working behind the scenes, has been getting huge credit for her work to interact with farmers. Landscape recovery projects are a great mechanism for fostering collaboration between different landowners in creating that public good that we need to see. Will the Minister expand on today’s announcement on the landscape recovery schemes, which will enable farmers to work together as bigger units to drive and deliver the public good that we all want to see?

My hon. Friend is right to highlight the landscape recovery scheme, which will deliver huge benefits to various parts of the country. It is a competitive process, and 25 schemes are available to be awarded. It will enable landowners, farmers and non-governmental organisations to come together to increase the amount of land in one package and to deliver a public good by building networks of improvement, with a single person having an overarching view of a whole landscape to make sure that we have, say, buffer zones next to rivers. That is a new concept, and the pilots prove that it works. I look forward to many more schemes coming forward.

Local, affordable and sustainable food production delivers real health and food security benefits to my constituents in Newcastle. We also benefit from the glorious north-east countryside and landscape, which is shaped by small-scale farmers. We have had six years of confusion and downright chaos on grants, subsidies, imports, food standards, etc. Will the Minister answer two simple questions? Will the small-scale farmers of the north-east benefit and be better off as a consequence of these changes, and will our landscape be more biodiverse?

I am tempted just to say yes, but it is clear that this opportunity requires farmers to engage in the schemes and to put forward their own plans, so it is subject to farmers looking at the website and working out deliverable plans. I suppose it depends on how the hon. Lady defines “better off.” If she defines it as attracting more Government subsidy, that is entirely possible under the scheme if farmers bid for and deliver the right environmental outcomes. Farmers have a choice whether to engage with the programme. We think it is very attractive and will help farmers not only to produce great food but to deliver great environmental outcomes.

I thank the Minister for his statement, and I welcome its intention. My right hon. Friend the Member for North Durham (Mr Jones) made an important point about the specific needs of smaller, tenanted farms, which are the lifeblood of our rural communities. I am reassured that the Minister understands the need for flexibility, but will he make sure that small tenant farmers are not unduly disadvantaged as a consequence of these proposals?

It is very much our intention to try to help and support farmers, whether they are owner-occupiers or tenants. There is something in the scheme for farms of all shapes and sizes, but we have an eye on the farmers that the hon. Gentleman describes. As he will be aware, the TFA is a powerful lobby group. The Kate Rock review is specifically looking at the plight of those farmers, and it is having an influence on Government policy.

As environmental and climate change goals become ever more urgent, how will updates to the plan specifically increase the use of peatland for carbon capture and storage?

The hon. Lady raises an important point, because our peatlands are under huge pressure, particularly in the lowlands, where they are disappearing. We need to try to embrace and support the farmers who are farming that land, because they are very productive in growing vegetables, particularly in the Lincolnshire wolds. We must make sure that we continue to sequester carbon in the peatlands in her constituency, as they are a huge carbon sequestration asset. That is a huge priority that this Government will continue to monitor and support.

I share the Minister’s excitement about the potential of the landscape recovery schemes, but we also need to leverage private sector finance if we are to reach net zero and halt biodiversity loss. What conversations has he had with colleagues in the Treasury, the Department for Business, Energy and Industrial Strategy, and across Government about ensuring that nature-based carbon credits actually have credibility? At the moment, it is difficult to quantify their value and to get people to be confident in investing in them.

As ever, the hon. Lady is very informed. This is a challenge that we have to get right, and we are putting a lot of work into making sure that we can measure these things in a right and fair way—this has to be applied in a global sense—and into engaging with the private sector to make sure it can help to support farmers and landowners to do the right thing to add to our environmental benefit, and so it is not just the taxpayer picking up the tab.