Select Committee on Environmental Audit Third Report



APPENDIX 2

Memorandum from the Ministry of Agriculture, Fisheries and Food

INTRODUCTION

  1. This Memorandum responds to the request by the Environmental Audit Committee for information about the conduct of the Comprehensive Spending Review (CSR) in MAFF and in particular how the Government's commitment to environmental protection and sustainable development was addressed.

CONDUCT OF THE CSR IN MAFF

  2. The purpose of the CSR was explained in a statement by the Chancellor of the Exchequer to the House on 11 June 1997. Departments were asked to scrutinise their spending plans from a zero base in order to assess how each item of expenditure contributed to the Government's objectives. Subsequently, the Treasury issued detailed guidance to Departments on the conduct of, and timetable for, the review.

  3. The terms of reference for the CSR in MAFF, and the arrangements for the conduct of the review, were published on 29 July.

  4. The Review Team assessed the rationale for each of the Department's spending programmes, including the scope for improving the overall effectiveness of the Ministry's operations. The Team was assisted in this task by a number of working groups which focused on the Department's key spending programmes. Each working group had specific terms of reference (see attached News Release) and all but one included non-departmental representatives who were acknowledged experts in their field. Each group also included representatives of other Government Departments, including a representative from DETR on the working group on support for farmers in the less favoured areas.

  5. The Ministry's countryside schemes were the subject of a separate review which was conducted jointly with DETR and also covered that Department's expenditure on countryside programmes. The outcome of this review was taken into account in the conclusions of the separate departmental CSRs for the two Departments.

SUSTAINABLE DEVELOPMENT

  6. A large part of MAFF's activities impact on the environmental and the efficiency and sustainability of the agricultural and food industries. Concern for sustainability and environmental impact is integral to MAFF's policies and as such was very much to the fore throughout the CSR without needing to be identified as a separate issue. Examples of areas in which sustainable development was considered include:

    —  Hill Livestock Compensatory Allowances (HLCAs): a policy evaluation of the HLCA scheme was carried out by external consultants and subsequently published. This discussed the effects of the scheme on grazing pressure and the measures which had been taken to address over-grazing. The CSR recommended that the present scheme be replaced by one with clearer environmental and social objectives.

    —  Flood and coastal defence: among the issues considered by a separate Working Group in assessing the continuing need for a flood defence programme were the risks associated with a rise in sea level. The Group also considered the arrangements for assessing grant applications and endorsed the present system under which schemes are assessed in terms of whether they are economically justified, technically sound and environmentally acceptable.

    —  R&D. The CSR Working Group on R&D noted that MAFF's research budget was directed mainly to supporting the Department's policies, including those relating to sustainable development and enhancement of the UK environment and its biodiversity.

  7. On the Common Agricultural Policy (CAP), the CSR concluded that there was no longer any rationale for production support, which should be phased out, and that the underlying objective should be to encourage an efficient agricultural industry capable of thriving without subsidy. While external pressures (WTO and enlargement of the EU) pointed to substantial reform, a general reluctance on the part of most Member States meant that progress would be slow. The review concluded that consumers and the rural environment should benefit from reform in the direction advocated by the UK.

OUTCOME OF THE CSR

  8. The outcome of MAFF's CSR was summarised in Chapter 18 of the White Paper on "Modern Public Services for Britain" and explained in broad terms by the Minister in his written statement to the House on 29 July 1998 (Official Report, columns 341-45). On 27 October the Minister gave evidence to the Agriculture Select Committee on the impact of the CSR on MAFF, and on the same day he made a further written statement to the House setting out the key financial implications for the Department (Official Report, columns 156-58).

  9. The CSR in MAFF did not identify any policies and/or subsidies, other than the CAP, which had an adverse environmental impact or ran contrary to sustainable development objectives. The Minister announced the closure of the Nitrate Sensitive Areas scheme. This decision was the result not of any failings in the scheme itself, but to release funds for improving and enhancing other priority agri-environment schemes.

ENVIRONMENTAL APPRAISALS

  10. Environmental appraisals as such were not undertaken for the new spending proposals in MAFF's CSR. However, an understanding of the relationship between subsidies to farmers and the environmental effects of farming informed discussions during the review. And, as mentioned in paragraph 6 above, the review endorsed the practice of making environmental impact a key consideration in the assessment of flood and coastal defence projects for grant aid. The Parliamentary Secretary (Commons) announced in July that flood and coastal defence schemes to protect environmentally important habits would, if necessary, be given a higher priority for funding than might otherwise be the case on strict economic grounds. The CSR concluded that the commissioning of a new marine research vessel was fully justified by the need for monitoring and research in support of the Department's work on the sustainability of fisheries and protection of the marine environment.

  11. Evaluation of new policy proposals will include an appraisal of the environmental impact where appropriate. The timing of evaluations will depend on a variety of factors including, for example, the outcome of the negotiations in the EU on the Commission's Agenda 2000 proposals.

MAFF'S AIM AND OBJECTIVES

  12. The Department is committed to respecting the principles of sustainable development in pursuing its objectives. These principles include addressing the environmental impact of our operations.

  13. The Department's Public Service Agreement sets out the aim and objectives, principles and approach of MAFF; the resources made available to the Department in the CSR; the broad approach to modernising services; the outputs and outcomes the Department will deliver; and the targets that we aim to achieve and the efficiency with which the resources will be used. Environmental considerations underpin a number of the Department's objectives.

  14. The Department is working with DETR to develop by Spring 1999 arrangements for the joint planning of countryside policies and programmes, including publication of joint countryside objectives, description of the programmes to achieve those objectives and plans for measuring performance against the objectives. A final decision on whether to produce a joint Public Service Agreement with DETR had not been taken at the time of writing.


 
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