Fifth Standing Committee on Delegated Legislation
Tuesday 16 July 2002
[Mr. David Amess in the Chair]
Draft Scotland Act 1998 (Cross-Border Public Authorities) (Adaptation of Functions, Etc.) (Amendment) Order 2002
The Parliamentary Under-Secretary of State for Scotland (Mrs. Anne McGuire): I beg to move,
That the Committee has considered the draft Scotland Act 1998 (Cross-Border Public Authorities) (Adaptation of Functions, Etc.) (Amendment) Order 2002.
It is a pleasure to move the order under your chairmanship, Mr. Amess. I am delighted that so many of my right hon. and hon. Friends and Opposition Members will join in our discussion. I thank my predecessor, my right hon. Friend the Member for Carrick, Cumnock and Doon Valley (Mr. Foulkes), who is in his place, for his able handling of the orders in the past year.
Hon. Members have been provided with an explanatory memorandum for the order, in line with the practice initiated by the Leader of the House, which took effect on 1 March. The order is made under section 89 of the Scotland Act 1998, which enables provision to be made in relation to cross-border public authorities as defined under section 88 of that Act. It allows arrangements to be tailor-made for allocating accountability and control between the United Kingdom Government and the Scottish Executive, and between the UK and Scottish Parliaments.
The proposal amends schedule 16 of a previous Scotland Act section 89 order, SI 1999/1747. The schedule relates to the functions of the Meat and Livestock Commission. The Scotland Act allows for today's order to be subject to either negative or affirmative procedure in both Parliaments. We chose affirmative procedure because the order merits full parliamentary consideration.
Hon. Members have seen the explanatory memorandum, but it would be useful briefly to set out the reasons for the order. The red meat sector is important to Scotland, as it accounts for 42 per cent. of the value of Scottish primary agricultural production. It has an annual output value of about £770 million. Furthermore, Scotland has 29 per cent. of UK beef cattle and 21 per cent. of the UK sheep herd. Those forms of agriculture account for more than 10 per cent. of gross domestic product in some areas of Scotland. Quality Meat Scotland was established in 1999 to support the red meat industry, primarily by promoting Scottish red meat. It was formed by the Meat and Livestock Commission, the National Farmer's Union for Scotland and the Scottish Association of Meat Wholesalers.
QMS derives its functions and a large part of its funding from the MLC. The MLC has the statutory
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responsibility to promote greater efficiency in the livestock industry in Great Britain. The MLC collects general and promotional levies on slaughtered or exported cattle, sheep and pigs. The Scottish general levy is currently retained by the MLC, because it retains responsibility for functions such as the collection of market information, research and product development, livestock improvement, and training and health education. However, devolution has highlighted the need for a distinctive and locally appropriate strategy for each part of Great Britain, and for new accountability arrangements between the MLC and Scottish Ministers.
The Scottish Executive undertook a consultation exercise in April to gauge industry's views on strengthening the role of QMS. The consultation was based on four core proposals: that QMS becomes responsible, on behalf of MLC, for all MLC functions in Scotland; that QMS is given the autonomy to develop a strategy for Scotland focused on Scottish red meat development and promotional priorities; that QMS receives the full Scottish general and promotional levies to address Scottish priorities for red meat development and promotion; and that QMS continues to invest in GB-level MLC services when that confers benefits on the Scottish industry.
Respondents to the consultation included all the key stakeholder groups in the Scottish red meat sector. They indicated a high level of support for the proposals on the role and functions of QMS, transferring the Scottish levy to QMS, and increased accountability to Scottish Ministers. Many respondents expressed the view that continued links with the MLC were important to avoid duplication of effort, to retain valued services, to protect core expertise and to maintain the integrity of GB programmes, while at the same time securing best value for the Scottish red meat sector.
The order makes provision for the financial arrangements, control and accountability of the MLC as a consequence of devolution. It will transfer to Scottish Executive Ministers the function of giving the MLC general directions on use of the Scottish levy. Currently, the Agriculture Act 1967 gives that function jointly to Agriculture Ministers. The arrangements for the setting of Scottish levy rates or collection of the levy are not changed, and the order will not affect the MLC's status as a GB body.
The order will require that the function of giving directions on use of the levy for England and Wales ceases to be exercisable by Scottish Ministers. For Scottish Ministers to exercise the function of general direction over use of the Scottish levy, that levy must be defined. To do that, the order will require my right hon. Friend the Secretary of State for Environment, Food and Rural Affairs, Scottish Executive Ministers and the National Assembly for Wales Minister for Rural Affairs to act jointly to make a determination to define the basis for the Scottish share of levy income.
The order will also require the MLC to prepare for Scottish Ministers an annual report on the discharge of its functions in Scotland. That will be an important part of strengthening accountability to Scottish Ministers. The delegation from the MLC to QMS of
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functions in Scotland, including the preparation of an annual report for Scotland, will be achieved through a joint ministerial direction. That will be made under provisions of the 1967 Act subsequent to the making of this order.
With that explanation, I hope that the Committee will agree the terms of the order.
Mrs. Jacqui Lait (Beckenham): It is a pleasure to serve under your chairmanship, Mr. Amess. I congratulate you and the Minister on reeling off the long name of the order, because it is one of the more complex in name, if not in detail. The Minister will be pleased to know that Opposition Members agree with the main ideas in the order, and that we hope not to detain the Committee too long. However, we have some questions, and I hope that the Minister will be able to answer them.
All members of the Committee would agree that the quality of meat that comes from Scotland is first-class. The Aberdeen Angus is known throughout the world, and there is a real sense that the quality of Scottish meat should be promoted by the people most closely concerned—those who belong to the Quality Meat Scotland organisation. The purpose of the order is therefore correct.
I am supported in that by the National Farmers Union of Scotland, which wrote to me to say that it sees this move as
''an essential part of developing the red meat industry in Scotland. There are particular priorities for the Scottish red meat industry as Scotland has its own, world-renowned brand.''
I have just referred to it.
QMS should be given the autonomy to develop a strategy tailored to Scotland, and this move is key to that objective. Alex Fergusson, who is a Member of the Scottish Parliament and the Conservative rural affairs spokesman at Holyrood, also agrees with us and with the order.
I should like to ask some questions merely for clarification. Can the Minister confirm that the QMS levy will be used entirely for Scottish promotion? Can it be varied in any way? The order makes it clear that the levy on Scottish producers cannot be varied in relation to the MLC. Can Scottish Ministers or anyone else vary the Scottish promotion levy? As I understand it, the Scottish general levy is retained by the MLC for its use. I assume that the amount that is raised from that levy can be varied only by the three organisations acting in concert, and that the Scottish levy cannot be varied without the levy on the English and Welsh producers also being varied. Could the Minister confirm that the Scottish Executive Ministers, acting alone, cannot vary either levy?
Under the heading ''Content of the Order'' the explanatory memorandum says:
''Scottish Ministers will have no involvement in giving directions as to deployment of levy other than the Scottish levy.''
That is quite confusing. It rather implies that there could be some variation. What direction are we talking about? Are we talking about detailed direction of QMS? Are we talking about Scottish Executive
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Ministers' right to appoint directors of QMS with a clear brief? Are we talking about direct interference by Scottish Executive Ministers in the affairs of QMS, who may act contrary to what QMS wants to do to promote the Scottish red meat industry?
I contacted the MLC to ask whether it had any briefing, and was slightly saddened to learn that the person to whom I spoke and who seemed to have responsibility for parliamentary affairs was not even aware that this statutory instrument was to be considered today. Although it is obviously not the Minister's responsibility, and someone from the MLC may be present, it would have been helpful to have its briefing as it is directly affected by the order. It could not let us have a copy of its response to the consultation either. Does the Minister plan to publish the responses to the consultation? I accept that they broadly support the order. Indeed, they may already have been published. If so, I should be grateful if she tell us where we can find them.
Finally, the section in the explanatory memorandum on policy objectives states:
''QMS will, however, continue to invest in and use MLC core services where joint GB activity makes sense, benefits Scottish levy payers, and represents good value for money.''
Who will decide what would benefit Scottish levy payers? What mechanism is there if QMS has decided that its priorities are different from those of the MLC? What is the system for resolving those issues?
I should be grateful if the Minister could answer those few questions, which I hope are not too complicated.