Select Committee on Environment, Food and Rural Affairs Ninth Report

ANIMAL WELFARE

85. There are particular concerns about the implications of the World Trade Organisation trade negotiations for rules relating to animal welfare. The RSPCA raised concerns that the legitimacy of national measures to improve animal welfare is questioned under World Trade Organisation rules.[147] Although there are no World Trade Organisation rules which prevent a country from raising its own standards, the RSPCA identified two consequences of doing so:

-  production costs increase, disadvantaging domestic producers against imports produced using less humane methods; and


-  because of rules on 'process and production methods' there are constraints on differentiating between 'identical products'.[148]

The European Union outlined in its comprehensive negotiating proposals that the World Trade Organisation had to address concerns about the implications of trade for a number of issues, including animal welfare. The Agriculture Council agreed the following:

"It is important to ensure that trade liberalisation does not undermine efforts to improve the protection of the welfare of animals.


"The EC propose that a number of possible actions to address this legitimate concern should be examined: (i) the development of multilateral agreements; (ii) appropriate labeling rules; (iii) to exempt compensation of additional costs to meet animal welfare standards from reduction commitments where it can be clearly shown that these costs stem directly from the adoption of higher standards and thus are not, or at fsmost minimally, trade distorting".[149]

The Deputy Director-General of Agriculture confirmed that the European Union's "basic position is that we would like to see an amendment of the green box so that payments to deal with additional costs arising from moving to higher welfare standards could be dealt with under the green box". However, it was received "extremely badly" by other members of the World Trade Organisation.[150] The RSPCA accepted that the Doha declaration would allow the continuation of talks about animal welfare within the agriculture negotiations but also noted that "other countries do not see non-trade concerns as important to trade liberalisation".[151] Comments made by other countries' representatives to the Select Committee and its predecessor have made it clear that they feel that support for animal welfare is at best a distraction and at worst trade distorting. In part, this may reflect the low level of activity of animal welfare organisations in those countries.

86. There has been criticism of the role and operation of the WTO from NGOs and some Third World Governments. They accuse the WTO of being a club of developed countries, whose main benefits accrue to multinational companies and which fails to provide mechanisms which can give fair access to the world market for the commodities of less developed countries. Our predecessor Committee recorded its support for the work of the Secretary of State for International Development "in furthering the interests of developing countries within the WTO".[152] We echo this support and that Committee's call for assistance for developing countries to "make their own representations and negotiate for their own priorities".[153] We are therefore pleased to note that WTO member governments pledged 30 million Swiss francs for a Global Trust Fund, established under the Doha Development Agenda, to "boost technical assistance and help developing countries to build capacity and participate fully in the Doha Development Agenda".[154]

87. We also received evidence on the adverse impact that the CAP has had on developing countries. Sustain told us that the CAP is "a major problem for developing countries... High European Union internal prices [paid] to producers, coupled with new technologies and higher yields, have led to chronic overproduction of some agricultural products, which are put on the world market using export subsidies creating surpluses that reduce world prices. This undermines domestic producers in developing countries and crowds out their exports to third countries".[155] The problem for developing countries of dumping surplus European Union agricultural production on the world market was also raised by Friends of the Earth.[156] The RSPCA also used the argument that export subsidies "can undermine domestic producers in third countries" in its support for phasing out export subsidies, particularly for live animals.[157]

88. In considering the impact of international trade liberalisation, developing countries cannot be treated as a single bloc. Some countries, for example in South America and South East Asia, have benefited enormously from the opportunity to take advantage of assets such as cheap labour, whereas others have clearly not been capable of taking advantage of trade liberalisation. This is particularly true of the countries of sub-Saharan Africa where the absence of, among other things, communication infrastructure and training, together with the failure to provide simple good government, have too often made it impossible for the economies to benefit from changing international circumstances. Although the engagement of the private sector is important, inevitably a significant part of the task will fall to government.

89. As well as specific animal welfare issues linked to the WTO, other 'ethical' issues have a broader resonance in the United Kingdom. For example, there are questions over the ethical acceptability of live animal exports, and concerns about whether the growth in intensive farming is intrinsically cruel to individual animals.

Food security

90. Differing views are expressed about the importance of food security: that is, the maintenance of a minimum level of domestic food production. The Tenant Farmers Association argued that "although the United Kingdom and Europe appear to have achieved a stable position of food security as a result of both increased domestic production and the ability to trade it cannot be guaranteed that this will always be the case". It concluded that "it is important that long-term food security is retained as a policy goal".[158] Professor McInerney, however, argued that "concern over food availability which has for long conditioned the public's attitude to agriculture has now gone".[159] He continued that "this new attitude towards food security has profound implications for agriculture, economically and politically, and will radically affect the way the farm sector develops from now on".[160] In nearly every other sector of production, globalisation and the growth of free and open trade have largely eliminated product security as a policy objective.

91. It is worth remembering that one of the principal driving forces behind the CAP was a desire to achieve self-sufficiency in the production of food within Europe in the aftermath of food shortages following the Second World War.[161] That it was successful in achieving its objective is beyond doubt: by the 1970s European farmers regularly produced surpluses in excess of what could be sold on the market. Even in the late 1990s, European farmers produced surpluses of, amongst other products, coarse grains and many dairy products.[162]

92. In the United Kingdom, however, self-sufficiency in food has declined over recent years. We raised the point with the Secretary of State, who said that the decline "is not an intrinsic concern of mine", although she agreed that it would worry some people. She said that she was mindful of the fact that "people put food security above all else, and that led to the CAP".[163] She continued that "if you take the view that there should be a market approach to British agriculture then it seems to me to be incompatible with having a fixed view as to what percentage of what Britain consumes should be produced within the United Kingdom".[164] She accepted that were still risks to food supply, mentioning the events of 11 September 2001, but argued the long-term move towards agriculture operating in a free trade environment would continue.[165]

Figure 7: United Kingdom Self-sufficiency in food[166]

Note:
2001 figures are affected by the foot and mouth disease outbreak.

93. Fixing minimum production levels is incompatible with the unfettered operation of the marketplace. The continuing development of free trade offers the best approach to maintaining a secure food supply. If relationships are developed across the globe on the basis of interdependence and trust, operating within the World Trade Organisation, the likelihood of access to the foods we need being restricted is very remote. Protecting trade on the grounds of ensuring self-sufficiency in food production is an outmoded concept in a globalised world. The Secretary of State should continue to assert within the European Union that the best way of ensuring food security is through improved trading relationships.

Climate change and Kyoto

94. Both the process of climate change and the measures put in place to tackle it are already beginning to have an impact on United Kingdom agriculture and it is likely that they will even more so in the future. The Kyoto Protocol to the United Nations Framework Convention on Climate Change lays down obligations on signatories to reduce aggregate anthropogenic carbon dioxide equivalent emissions of the greenhouse gases. The Protocol permits the use of carbon sinks, as long as it is possible to verify their net effect on emissions.[167] Some major agricultural producers, including the United States, have announced that they will not sign the Protocol.[168] However, on 31 May 2002, the European Union ratified the Kyoto Protocol.[169]

95. The Government has introduced the climate change levy to provide both a carrot and stick to encourage the reduction of carbon dioxide emissions. In the previous Parliament, the Agriculture Committee examined the introduction of the climate change levy in the United Kingdom.[170] They heard then about the role that agriculture may play in reducing United Kingdom emissions of carbon dioxide. In this Inquiry, Mr Gill argued that "the only way to stop carbon dioxide levels rising is to stop burning mineral oil the way we have". He continued that "you use plants as the only alternative raw material for industry". He suggested that by 2010 "as much as six million hectares" of land in Europe could be devoted to industrial raw materials, in addition to crops for bio-fuels and bio-ethanol.[171]

96. Despite the likelihood that climate change will affect agriculture as a result of more extreme weather in the future,[172] responding to climate change may present opportunities for British farmers. Agriculture has the potential to assist society in terms of reducing carbon dioxide emissions, for example, through the production of 'green' bio-fuels. The issue is whether this can be done at a reasonable cost. The Government should consider the role that agricultural production can play in reducing carbon emissions in the Energy White Paper.

United Kingdom Agricultural Policy

97. Much of recent domestic agricultural policy has been formulated in response to the need to 'fire fight' farming crises. The result has been a welter of ad hoc packages intended to support the industry. The demise of the Ministry of Agriculture, Fisheries and Food and the creation of the Department for Environment, Food and Rural Affairs, shortly afterwards followed by the realisation of the Government commitment to establish a Policy Commission on the Future of Farming and Food, has prompted more thinking about the development of a longer-term strategic agricultural policy.

September 1999 aid package

98. In September 1999, Nick Brown, the then Minister of Agriculture, Fisheries and Food, acknowledged that livestock farmers were under serious pressure and announced a support package worth £537 million.[173] He said that given the serious pressure on the sector "it is right, exceptionally, to consider special measures. These should cover not just support measures, but also regulatory burdens, to enable the industry to move closer to the market".[174] The money comprised a total of £387 million of agrimonetary aid (£94 million of which had previously been announced), and £150 million of "new money" for other measures, including the maintenance of Hill Livestock Compensatory Allowances funding (£60 million), the waiving of charges associated with specified risk material disposal at abattoirs (£44 million over two years), the waiving of charges for cattle passports (£45 million over three years), and marketing support (£1 million).

99. In making the announcement Mr Brown reaffirmed:

"the Government's policy for British farming to reduce its reliance on subsidies based on production, and to restructure itself for long­term sustainability, and develop real markets for its products, less distorted by the CAP.


"The CAP reform agreed by Heads of Government in Berlin earlier this year is an important step in this process. It provides a range of options on which we are seeking views from all interested organisations. This autumn, once we have heard organisations' views, we will announce decisions on the Agenda 2000 Rural Development Regulation".[175]

Thus it was made clear that the Government wished agriculture to move closer to the marketplace. But it accepted that exceptional support measures were justified whilst agriculture was adversely affected by the impact of sterling.

The England Rural Development Plan

100. On 7 December 1999, the England Rural Development Plan was released.[176] The Plan represented the Government's proposals to implement the Rural Development Regulation, the second pillar of the CAP in England. The Rural Development Regulation provided member states with measures "to advance environmentally beneficial farming practices, to modernise and restructure their farming industries and to support off-farm rural development".[177] It was to such matters that the English Rural Development Plan was directed.

101. The Plan anticipated total expenditure of £1.6 billion over seven years on agri-environmental schemes and rural development, which represented a 60 per cent increase over seven years on spending on such matters.[178] A radical new development set out in the Plan was the modulation, or redirection, of a small percentage of the direct production subsidies paid to United Kingdom farmers under the CAP commodity regimes to the agri-environmental and rural development schemes. In 2001, 2.5 per cent of the value of direct payments would be channelled to such schemes, and by 2005 and 2006 this would have increased to 4.5 per cent. Other funding came from the Ministry of Agriculture, Fisheries and Food budget, European Union contributions, and a Treasury commitment to match the modulated element.

102. Following European Commission approval of the plan the England Rural Development Programme was published in October 2000.[179] The Table below summarises the total spending under the main headings of the Plan over its seven year life.

Table 7: England Rural Development Programme Expenditure 2000-2006 (£ million)[180]

Measures	Expenditure (£ million)
Investment in agricultural holdings Training Less Favoured Areas Agri-environment Improving processing and marketing of agricultural products Afforestation of agricultural land Other forestry measures Rural Enterprise Scheme Total	16.6 22.0 253.8 961.0 44.0 172.0 64.9 140.3 1674.7

Note:

The Less Favoured Areas, agri-environment, afforestation of agricultural land and other forestry measures are existing measures. In most cases spending on the existing measures and new measures increases during the life of the England Rural Development Plan.

The spending on less favoured areas changes from a headage to an area basis at the start of the England Rural Development Programme (subject to transitional assistance for those whose payments are reduced substantially).

Action Plan for Farming

103. The situation in farming did not improve. A summit was held in Downing Street on 30 March 2000, which resulted in an Action Plan for Farming. The Action Plan was intended to take the strategy contained in the English Rural Development Plan a stage further. The action plan would:

i.   "provide financial relief for the hardest-hit sectors and help ease the process of change that they must face;


ii.   "ensure that the England Rural Development Plan steers the industry towards it new priorities and new direction;


iii.   "meet environment and consumer safety objectives and safeguard the taxpayers' interest with the minimum administrative and cost burden, regulating only where necessary and wherever possible using a range of incentives, voluntary measures and market measures to achieve these goals;


iv.   "ensure that Government, farmers and the food industry work together to find ways to improve profitability in the industry;


v.   "ensure that the Government works tirelessly in the European Union to secure a more market-orientated CAP, to remove production controls and to simplify bureaucracy".

It offered further financial assistance to the industry worth more than £150 million. The support included a pig industry restructuring scheme (over three years), further agrimonetary compensation, the removal of dairy hygiene charges and additional support for hill farmers.

104. The Action Plan also stressed the need for Government and the food chain:

"to build our way out of the crisis and create a new partnership to get agriculture on course for a healthy and profitable future";


to "become more competitive and more sustainable in the medium and long term"; and


"to be prosperous, forward-looking and sustainable".

It acknowledged that Government "has a duty to ensure that the essential safeguards to the consumer, the taxpayer and the environment are in place". It reiterated the Government's policy on implementing European Union regulations in relation to farming "will be to avoid all 'gold plating' of the legislation, its implementation and enforcement; to regulate in the least bureaucratic and burdensome way and to avoid implementing legislation ahead of specified European Union deadlines".[181] But it stated that British food and farming industries "must respond to the demands of consumers - for food of the highest quality, meeting the diverse needs of diverse people", and reaffirmed that the Government sought to "secure further market-orientation of the CAP to the benefit of United Kingdom farming as well as consumers and taxpayers".[182]

Other Measures

105. In addition, on 23 September 1999, three Red Tape Working Groups were established to "find ways of doing things better and to root out unnecessary regulation" in agriculture. They examined the Integrated Administration and Control System (IACS)[183] and farm inspections; slaughterhouse regulation and meat hygiene rules; and the operation of the intervention system,[184] and reported by December 1999.[185] In total the three Groups made 107 recommendations to reduce the burden of regulation. In February 2000, the Minister of Agriculture announced that the Government had accepted 98 of the recommendations.[186] The IACS and Inspections Group met again in December 2000 to review the Government's progress in implementing its recommendations. In a letter to the Minister, Sir Donald Curry, the Group's chairman, wrote that "the Group is very pleased with the commitment shown and the progress being made in the implementation of almost all the recommendations".[187] Further progress on the recommendations has subsequently been made: on 26 March 2002, the Department for Environment, Food and Rural Affairs announced the establishment of the independent appeal procedure for farmers unhappy with subsidy payment awards.[188] The Government should outline the progress that has been made on all the recommendations of the Red Tape Working Groups, particularly in respect of those which required negotiations at European level. It should now offer the Working Groups a further opportunity to comment on progress against their recommendations.

106. In December 2000, Hills, Inputs and Milk Task Forces were established following the launch of the Action Plan for Farming.[189] They had all reported by January 2002.[190] In April 2002, the Government responded to the Milk Task Force, but it has yet to reply to the other two reports. We recommend that the Government indicate how, if at all, it intends to take forward the recommendations of the Hills and Inputs Task Forces.

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147   Memorandum submitted by the Royal Society for the Prevention of Cruelty to Animals, Ev 357-Ev 358, para 3. Back

148   Memorandum submitted by the Royal Society for the Prevention of Cruelty to Animals, Ev 358, para 5. Back

149   Conclusions of the Agriculture Council on 20 and 21 November 2000 - EC comprehensive negotiating proposal, para 20. Back

150   Evidence taken on 23 January 2002, Ev 11, Q.50. Back

151   Memorandum submitted by the Royal Society for the Prevention of Cruelty to Animals, Ev 358-Ev 359, paras 8-9. Back

152   The Implications for UK Agriculture and EU Agricultural Policy of Trade Liberalisation and the WTO Round, Sixth Report of the Agriculture Committee, HC (1999-2000) 246, para 68. Back

153   Ibid. Back

154   WTO News Press/270 (2002), see: http://www.wto.org/wto/english/news_e/pres02_e/pr279_e.htm. Back

155   Memorandum submitted by Sustain, Ev 203. Back

156   Evidence taken on 6 March 2002, Ev 165, QQ.628-632. Back

157   Memorandum submitted by the RSPCA, Ev 359, para 13. Back

158   Memorandum submitted by the Tenant Farmers Association, Ev 269. Back

159   John McInerney, Re-orienting UK Agriculture, p. 6. Back

160   John McInerney, Re-orienting UK Agriculture, p. 7. Back

161   European Commission, Agriculture: introduction, see: http://europa.eu.int/scadplus/leg/en/lvb/l04000.htm. Back

162   See http://europa.eu.int/comm/agriculture/publi/caprep/prospects2002/summary.pdf. Back

163   Evidence taken on 15 May 2002, Ev 314, Q.1072. Back

164   Evidence taken on 15 May 2002, Ev 315, Q.1073. Back

165   Evidence taken on 15 May 2002, Ev 315, Q.1075. Back

166   Source: Department for Environment, Food and Rural Affairs. Back

167   The Kyoto Protocol to The United Nations Framework Convention on Climate Change, see:

http://unfccc.int/resource/docs/convkp/kpeng.html. Back

168   See World deal on climate isolates US, Guardian Unlimited, 24 July 2001. Back

169   European Union ratifies Kyoto Protocol, the Department for Environment, Food and Rural Affairs News Release 212/02, 31 May 2002. Back

170   Agriculture Committee, Environmental Regulation and Farming, Fourth Report, Session 1999-2000, HC 212. Back

171   Evidence taken on 8 May 2002, Ev 288 Q.964. Back

172   Evidence taken on 8 May 2002, Ev 306, Q.1035. Back

173   Some of this total had already been announced: expenditure totalling £293 million was announced for the first time. Some of the announced was for one year, other funding was for up to three years, including the 1999/2000 financial year. (MAFF News Release 327/99, 22 September 1999.) Back

174   MAFF News Release 327/99, 22 September 1999. Back

175   MAFF News Release 327/99, 22 September 1999. Back

176   See http://www.defra.gov.uk/erdp/erdphome.htm. Back

177   MAFF News Release 435/99, 7 December 1999. Back

178   HC Debates, 7 December 1999, col 701. Back

179   Rural development plans exist for Scotland (see http://www.scotland.gov.uk/library3/misc/rdps­00.asp), for Wales (see http://www.wales.gov.uk/subiagriculture/content/ruraldevplan/part_1.pdf), and of course also for Northern Ireland (see http://www.dani.gov.uk/core/dard0380.htm). Back

180   MAFF (2000) England Rural Development Programme, Chapter 9, Table 10. Back

181   Action Plan for Farming, March 2000; see http://www.defra.gov.uk/farm/agendtwo/strategy/action.htm. Back

182   Action Plan for Farming, March 2000. Back

183   A system intended to combat fraud and control expenditure on the CAP in Europe; see The Implementation of IACS in the European Union, Seventh Report of the Agriculture Committee, HC (2000-01) 150-I; the Report can be seen on the internet at http://www.publications.parliament.uk/pa/cm/cmagric.htm. Back

184   MAFF news release 328/99, 23 September 1999. Back

185   See http://www.defra.gov.uk/corporate/regulat/redtape/redtape.htm. Back

186   MAFF news release 37/00, 2 February 2000. Back

187   MAFF news release 52/01, 13 February 2001. Back

188   DEFRA news release 122/02, 26 March 2002. Back

189   MAFF News release 410/00, 23 November 2000. Back

190   See http://www.defra.gov.uk /farm/mtfreport/mtfreport.pdf, http://www.defra.gov.uk /farm/hillsrep/report.pdf, and .http://www.defra.gov.uk /farm/itfreport/index.htm. Back

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Prepared 6 November 2002