Farming Industry: Support

Question for Short Debate

Asked by

To ask Her Majesty’s Government what plans they have to provide support to the British farming industry to combat (1) increased production costs resulting from the ongoing labour shortages, and (2) increased competition from the Australian and New Zealand markets.

My Lords, I must start by declaring my interests as set out in the register. I thank all noble Lords taking part in this debate—however brief the time they have—and the noble Baroness, Lady Bloomfield, for taking part on behalf of the Minister who, I believe, is self-isolating with Covid.

The purpose of this debate is to raise two major issues, both of which are a result of Brexit. I know those issues were debated as part of speeches about Brexit, and the problems associated with it could be seen as an “I told you so” but that is probably not the most progressive way of looking at these issues. I was looking just at labour shortages, because both issues are enormous subjects, especially for an hour-long debate. However, the issue of free trade agreements was very live on the doorstep in North Shropshire during the recent by-election, where we managed to return the most excellent Helen Morgan as the MP. It is an issue that the farming community takes very seriously. The purpose of linking those two issues together is to look at the short-term issues that the industry faces, but also the longer-term issues raised.

Obviously, we are in a period of transition where we are moving from the CAP which, for all its faults—having debated it many times, I know that there were many—gave farmers an underlying, sustainable subsidy regime for the financial models on which they could base their business. The issue at the moment is that the Government are formulating policies to replace that subsidy regime. I ask a question which is asked many times: is it the Government’s intention to maintain the current farm payments until the new Brexit support scheme is rolled out in full and in place? Is there any basis in the reports that farmers could lose half their money in the next four years, because that would drive thousands of family farms out of business? Any information the Minister can give on that would be very helpful.

Looking at the different issues, I start with labour shortages. This is a Brexit issue, because British agriculture was particularly reliant on the freedom of movement of EU workers before Brexit and, to meet our needs, will continue to be after Brexit. Almost all the 70,000 seasonal workers in fruit picking and vegetable harvesting were from eastern Europe in 2017, according to the National Farmers’ Union, and in 2018, a report by the Migration Advisory Committee said that 99% of seasonal agricultural workers were from EU countries. The present position across the whole of the agriculture and food sector is that there are about half a million job vacancies, which is of course causing major problems.

For the horticultural sector, this shortage of workers means that some crops remain unpicked. Apparently, in June this year, 30% of daffodils were unable to be harvested or were picked later than planned due to labour shortages. Some produce is also being left in storage for longer. For the poultry sector, it means that production has had to be cut back. There is a particular need for flowers and fruits in the ornamental sector to be included in this debate because they are often overlooked.

I declare an interest as the former MP for Harpenden, where the Rothamsted Research Institute is.

When your Lordships’ House discusses agriculture, it is converted into a TARDIS, transporting us back in time to the Corn Law debates of the 19th century—debates then, as now, dominated by landowners advocating for protection and high food prices and supported by bourgeois romantics who oppose industrialisation and progress; their modern counterparts are the Greens. Both are indifferent to the impact of higher food prices on those poorer than themselves. I hope that I will not be the only one to speak up for consumers today.

The only way to combine prosperous agriculture with abundant, low-cost food is for farming to be competitive. Nothing promotes competitiveness like competition, which means phasing out protections and subsidies. Can UK farming become competitive without protection? Much of it already is. The world record yield for wheat changes hands between farms in Northumberland—the county of the noble Lord, Lord Redesdale—and New Zealand, both far higher than the best producers in Canada, the US or Russia.

New Zealand agriculture, which this Motion sees as a threat, was losing competitiveness until it abolished all protective tariffs and subsidies. The NFU brief for this debate claims that New Zealand’s costs are between one-quarter and two-thirds lower than the UK’s but it ignores the subsidies that UK farmers receive, which are equal to 40% of their costs. It also ignores the cost of transporting New Zealand products half way round the globe.

Improved UK competitiveness will come not just from the long tail of less efficient farmers adopting the efficient methods of the best. As well as reducing time-consuming EU regulations, Brexit should mean that British farmers can apply modern scientific methods banned by the EU—often developed at Rothamsted— such as CRISPR and GM, which will boost yields and reduce the use of costly and environmentally unfriendly pesticides, herbicides and fertilisers. The main losers from opening up our market to our Antipodean friends will be not UK farmers but inefficient European farmers, who currently supply nearly half our food. The winners will be more efficient British farmers and hard-pressed British consumers.

My Lords, two minutes: three points. First, on labour costs, the fact of the matter is that British farming is going to have to accept that it will have to pay its workers more. As the noble Lord, Lord Redesdale, said, we have relied for too long on immigrant and migrant labour to undercut British workers. We need a proper skills base to address the kind of mechanisation and technological improvement referred to by the noble Lord, Lord Lilley. We need better training. Unfortunately, the underfunding and overdiversification of Lantra and our agricultural colleges have meant that new people who are skilled enough to take up posts as farm workers or managers are not coming through. I hope that the Government will recognise this problem and set up a manpower board for land skills that truly delivers a new generation of a skilled workforce working in this new era.

On trade, I disagree with the noble Lord, Lord Lilley. We are placed in a very difficult situation: just at the point where subsidies are being reduced and costs increased, we sign a deal which goes against the commitments made by the Government during the passage of the Agriculture Act. I can only quote the words—approvingly, in this case—of the president of the NFU when she said:

“We always wanted to do a deal with Australia. But we never thought that it would be a deal where we just gave the most prized food market in the world over for nothing.”

That is the problem with the deals being reached now.

Thirdly, on policy itself, there is a central problem. I agreed with the greening of agricultural policy in the Agriculture Act, but it has proved to be very slow and complex to deliver. To judge by the words of George Eustice last week, the problem is that the Government are focusing not on making agricultural and food production more sustainable but removing large chunks of land from food production for other purposes. That is the wrong emphasis. Both have to happen, but we need to find more sustainable, effective and advanced methods of producing our own British food.

My Lords, I am proud to chair the Manufacturing Commission of which Jack Dromey was vice-chair, and I pay tribute to him. He was outstanding. I thank the noble Lord, Lord Redesdale, for initiating this debate, and I declare my interests right up front as the manufacturer of Cobra Beer, manufactured using the finest British malted barley, and Malabar Blond IPA—India pale ale—produced using the finest British hops.

I am so proud of our British farming industry, and I pay tribute to the NFU, which is a member of the CBI, of which I am president. In fact, the NFU identified in a report last year that there is an estimated workforce shortage of 500,000 across the food and farming sector, including hospitality and haulage. In June last year, the CBI and I pointed out—including on the Floor of this House—labour shortages, for example among lorry drivers and butchers. The Government did not listen. By October last year, healthy pigs had to be culled at farms rather than being sent to slaughter. This was the first time that pigs were mass culled since the 2001 foot and mouth outbreak. The Government eventually issued temporary visas for 800 pork butchers, which were available until the end of 2021. Will the Government extend this? The Government also eventually announced temporary visas for 5,500 poultry workers and 4,700 HGV drivers. The HGV driver visas expire on 28 February, and the poultry worker visas expired on 31 December. Will the Government extend these?

Why do the Government not reform the Migration Advisory Committee, including academics, economists and businesspeople, to give it the independence of the Low Pay Commission, which sets the minimum wage that the Government have to follow, or the Monetary Policy Committee, which sets interest rates that the Bank of England has to follow? This reformed MAC could, on a regular basis—quarter by quarter—activate the shortage occupation list sector by sector, prescribing the number of jobs and the length of the visas. This would give our economy, including our farming, food and drink sector, the workforce that it needs, instead of crippling it with self-inflicted labour shortages and shooting ourselves and our economy in the foot.

My Lords, Kent is the garden of England. Its fruit and vegetable growers are market leaders and are now being joined by English wine growers in being held in increasingly high esteem. All these producers are being crippled by the restrictions of the seasonal workers scheme.

It is missing the point to say that English workers can fill the void. They cannot, as has been ably demonstrated by the training schemes of the like of the admirable Thanet Earth organisation, where after good teaching and with good pay prospects, English trainees wither on the vine and fail to stay the course. Mechanisation and automation are also not the panacea they are made out to be—at least not for a few years yet. Can the noble Baroness try to apply further pressure to ensure that the numbers in the seasonal workers scheme can be increased? Without the provision of more pickers, many of our admirable market-leading producers will be unwilling to invest and will cease to be competitive.

In my view, the Australian trade deal will prove to be most unhelpful for British beef producers. When, according to the NFU, the cost of Australian beef production is around two and a half times less than for the UK, it is not surprising that the Australian trade negotiators could not believe how easily the British Government were rolled over in their eagerness to get one run on the new trade deals scoreboard. The 10-year implementation period will allow the mist of time to descend to disguise how awkward this trade deal will be for all future British Governments.

The recent decision by Asda to suspend the purchase of British beef in favour of Irish—a quick-turnaround decision made on cost alone—shows how exposed the industry is to cost pressures. Can the Minister give any assurance that the same high standards of animal welfare, environmental protection demands and haulage time limitations, all of which are being imposed on and willingly met by British producers, will be monitored and adhered to in Australia and New Zealand? What power of sanction can she realistically suggest that the Government of the day will have to exercise should any such failings be identified?

My Lords, my noble friend Lord Whitty is right: the ongoing labour shortages in agriculture are caused by low wages and bad terms and conditions. The problem has dogged agriculture for years. Hitherto, the sector has been sustained by cheap European labour, which the government visa scheme will now extend. The use of foreign labour has been dependent on single persons whose families remain abroad and who therefore do not need to pay British family costs and are prepared to put up with non-family accommodation.

In 1924, the problem of low wages was addressed by the Agricultural Wages (Regulation) Act, which established agricultural wages boards, AWBs, which set wages by collective bargaining. The resulting annual agreements were binding by law on all agricultural employers and workers. The AWB for England and Wales was abolished in October 2013, though Scotland retained its board. The Welsh Government established their own, facing down a challenge in the Supreme Court in doing so. Now the Northern Irish board is under threat.

The AWBs set different rates reflecting skills and experience, thus offering something of a career progression—essential to attract youngsters into farm work. There were enhanced rates for overtime, weekend and night work, and fallback rates for waiting and travelling time. Housing costs were regulated and, underlying it all, workers had a say in their terms and conditions. Clearly, the AWB for England should be reinstated.

Small farmers operate on small margins, of course, but it was not they who sought abolition; it was the supermarkets. The brutal truth is that food is too cheap, and consumers too deserve higher wages. As the TUC general secretary said in a new year message:

“Britain needs a pay rise.”

The Government’s goal of a high-wage, high-productivity economy should start with agricultural workers.

My Lords, I congratulate the noble Lord, Lord Redesdale, on securing this debate and refer to my interests in the register.

A common strand to all the northern dales, whether Northumbria, Cumbria, Durham or North Yorkshire, is the sheer number of family farms. In North Yorkshire in particular, almost 50% are tenant farmers.

I take issue with my noble friend Lord Lilley. I argue: where is the level playing field? How can it be right that we are imposing higher costs of production in the stringent animal welfare and environmental criteria that our livestock farmers have to meet, yet are going to accept meat produced to a lower standard from Australia and New Zealand? That simply cannot be right, and I ask my noble friend and the Government to look very closely at that.

Also it cannot be right that the Animal Welfare (Kept Animals) Bill, if my understanding is correct, will outlaw the sale of live animals, particularly the sale of spring lambs to France, which is an outlet that is highly regulated and limited in nature but a source of income to northern farmers. What understanding can my noble friend the Minister and the Government display of livestock farming production? Can she say this evening with clarity what the schemes that replace those under the CAP will contain? Will she endeavour immediately to make the forms simpler at the point of sale at livestock marts, and can she tell us precisely how livestock farmers, particularly small family farms and tenant farmers, will benefit from the new schemes? My wish list this evening is: simpler forms at the point of sale; clarity of the new schemes; and affordable homes for farmers to retire to.

My Lords, I am sure we will hear from the Minister how Defra will take our farmers to the sunny uplands during the agricultural transition plan rollout and move us as far away as possible from the European Union and its hated farming policies, but in my part of the world, up in north Yorkshire where we have more sheep than people, there is considerable anxiety about just how effective the Government’s model is going to be.

Most of us would not argue against the environmental land management scheme as being a good thing—nor would we argue about giving grants to improve productivity, especially around animal welfare and that catch-all word “sustainability”. But the questions farmers here are asking are, when negotiating the Australian trade deal, did the Government calculate what impact importing meat might have on UK meat producers? Sheep farming is a mainstay of farming in the Yorkshire Dales. In relation to the stated aims of maintaining our landscape for tourism, leisure and encouraging wildlife, are the Government simply relying on making payments to keep the landscape as it is now, without considering how best to support and maintain the market for sheepmeat? Will sheepmeat imports be subject to the same production standards as meat from farms in Yorkshire? If not, what steps will the Government take to compensate Yorkshire farmers?

Basic payments have accounted for around 60% of profits for farmers over the last five years; they urgently need to know how that will be replaced. A plethora of complicated new schemes is being offered, one of which might mean that farmers decide to sell off land and move to producing renewable energy. One firm has already signed up more than 500 additional renewable sites, 80% of which are on UK farmland. Indeed, one is proposed on a contentious site close to my town’s boundaries. Farmers complained bitterly of the huge amount of paperwork and form-filling when we were members of the EU; will they not be hit by even more of it now that we have “taken back control”?