House of Commons - Environmental Audit

Select Committee on Environmental Audit First Report

PESTICIDES: THE VOLUNTARY INITIATIVE

1. In 1997, the new Government came into office with a strategy to pursue sustainable development through a programme of environmental tax reform. The object was to shift over time the balance of taxation from 'goods' to 'bads' in accordance with the 'polluter pays' principle.[1] The Government commissioned research and reviews to examine the scope for introducing environmental taxes,[2] and during the last Parliament it took forward proposals in three areas-pesticides, aggregates, and energy. In two of these-aggregates and energy-environmental taxes have now been introduced.[3]

2. In the case of pesticides, the Government's decision to adopt a 'partnership' approach with the industry instead of a tax provoked an exchange of correspondence between ourselves and the Treasury.[4] When the Financial Secretary of the Treasury appeared before us in January 2000, he stated that industry proposals for a voluntary approach had only just been received and would require considerable analysis before coming to a decision. We were therefore astonished when the Prime Minister announced barely two weeks later that the Government had decided not to introduce a pesticides tax.[5]

3. The speed of this announcement demonstrated that the decision was made on political grounds at the highest level in the light of the economic hardship the farming industry was facing. There was clearly little opportunity for any analysis and consultation with departments, some of which we suspect might have been rather more cautious about the effectiveness of a partnership approach.

4. The Government subsequently released the industry's formal proposals for consultation, and in October 2000 the industry submitted a revised set of proposals which took account of some of the concerns raised. At the same time, the Government commissioned a consultancy review of the proposals and the likely effectiveness of the voluntary approach.[6] A third revision of the proposals was put forward by the industry in February 2001 and finally approved by the Government the following month.[7]

5. The Voluntary Initiative, as it was later called, represents a formal agreement between the Government and the farming industry. Those organisations which have signed the agreement-'the signatories'- consist of the main industry trade group, the farming unions, and several smaller trade bodies. The signatories bear responsibility for implementing the agreement. There is also a Steering Group, composed of representatives of the signatories and certain other organisations including environmental agencies and NGOs. The Steering Group is chaired by an independent Chairman, Professor Barry Dent, who reports on progress to the Minister for the Environment every six months. The Minister appointed Professor Dent as Chairman in August 2001, and the first meeting of the Steering Group took place on 21 September 2001.

Voluntary Initiative Steering Group Members[8]

Signatories
Crop Protection Association
National Farmers Union
National Farmers Union of Scotland
Ulster Farmers Union
Country Land and Business Association
National Association of Agricultural Contractors UK Agricultural Supply Trade Association
Agricultural Engineers Association

Environmental / Other
English Nature
Environment Agency
Royal Society for the Protection of Birds
Friends of the Earth
Water UK
Pesticides Action Network UK
LEAF
Scottish Environment Protection Agency
Assured Food Standards
WWFUK

6. The aim of the Voluntary Initiative is to encourage farmers to use pesticides more effectively and with greater awareness of the environmental impacts of their actions. It is due to run for 5 years (until March 2006) when its success will be evaluated. However, the Financial Secretary of the Treasury has continued to insist that a pesticides tax is still on the agenda if the Voluntary Initiative is seen to be failing.[9]

7. In view of the fact that the Voluntary Initiative has now been in place for over 18 months, we considered it appropriate to evaluate the progress being made. We took evidence from members of the Steering Group, including both signatories and environmental organisations, and from the independent Chairman, Professor Dent. We also received an unpublished paper from the Friends of the Earth.[10]

Aims and objectives

8. The Government's policy objective with regard to pesticides is to minimise the adverse environmental impact of their use, consistent with adequate crop protection.[11] But this goes rather wider than the Voluntary Initiative itself, as it includes the activities of other bodies involved in approving and regulating pesticides.[12] The Voluntary Initiative approved proposal states that "In developing our package of measures, the overall objective has been to reduce the environmental effects of pesticide use and to improve the biodiversity of arable farmland. We believe that this can be achieved by working closely with farmers, land owners, pesticide users and others to best ensure that they also understand and address these issues".[13]

9. The evidence presented to us revealed that there was a significant disparity of views over the aims of the Voluntary Initiative. The signatories denied that a reduction in pesticide use was an explicit objective and emphasised instead that the key issue was the efficiency and effectiveness of application.[14] Environmental organisations, however, supported the principle that a reduction in pesticide use was desirable and should be a specific outcome of the Initiative. They also expressed concern that the Voluntary Initiative laid insufficient emphasis on alternative methods of crop management; and that indeed there was insufficient knowledge about the indirect effects of pesticide use on non-target species.[15]

10. We appreciate that measuring the environmental impacts of pesticide use is complex, and cannot simply be done by measuring the overall weight of substances applied. Our previous report examined this issue in greater depth.[16] However, it appears to us that greater efficiency in the use of pesticides must logically result either in a reduction in pesticide use or in a greater amount of pesticides being applied to the target crops. We were unclear what position the signatories were taking on this issue, but Mr Kinnaird at any rate acknowledged that the scope for reductions was huge.[17] In our view, the objectives of the Voluntary Initiative lack clarity in the extent to which they include a reduction in pesticide use as an explicit aim.

Progress

11. The Voluntary Initiative consists of 27 individual projects. They focus largely on procedural aspects-the research and implementation of best practice in sprayer application. Three of these projects were felt to be of such overriding importance that they underpinned the development of the rest. These 'three pillars' as they were termed in the approved proposals are:

a baseline survey of current farm sprayer practice;

the development and implementation of crop protection management plans; and

the appointment of a biodiversity officer within the Crop Protection Association and the development of a biodiversity network.

12. The first 'pillar' of the Voluntary Initiative was the need to conduct a thorough survey of current sprayer application practices. Information in this area was lacking, and the survey would provide a baseline against which some aspects of progress on the Voluntary Initiative could be measured. It would also provide important information required for developing other projects in the Voluntary Initiative. The survey was contracted out to the Central Science Laboratory, an agency of DEFRA. It involved 402 farm visits, and a postal survey of a further 374 farms. It covered aspects such as agronomic advice, the extent of operator training, the age and condition of spraying machinery used, cleaning of sprayers, and disposal of waste packaging etc. The survey was completed in March 2002.[18]

13. The farm sprayer application survey is a welcome development, though we are surprised no such survey has been carried out before. The survey is due to be repeated in year 4 of the Initiative and may enable some assessment of its effectiveness. However, it did not address the potential for reduction in the use of pesticides. In our view, the absence of such information will undermine an assessment of the effectiveness of the Initiative.

14. Requirements for Crop Protection Management Plans (CPMPs), the second crucially important 'pillar' of the agreement, were to have been drawn up by early 2002. The plans should have been trialled on farms on a pilot basis during the summer, so that revised requirements could be issued in autumn 2002.[19] The Voluntary Initiative approved proposal contains a target that 30 per cent of arable land should be under such plans by 2006.[20]

15. A short paper prepared for the September 2002 meeting of the Steering Group states that "throughout the summer discussions have continued with interested parties on the scope and style of the Voluntary Initiatives' Crop Protection Management Plans with no real consensus emerging other than recognising that¼there are significant overlaps with APS, ACCS, RPA's farm audit, LEAF's and Sustainable Farming Co.'s crop protection management plans". It goes on to state that 75 per cent of the likely questions in a crop protection management plan would be addressed (and compliance verified) by these schemes.[21]

16. In his September 2002 report to Ministers, Professor Dent stated "I continue to have concerns over the development of the Crop Protection Management Plans. This pillar is being lead by the National Farmers Union. Unexplained delays have occurred although an agreed draft plan was presented to the Steering Group on the 4 September". But he expected that, as the basis for the Crop Protection Management Plans had now been agreed, significant progress would ensue.[22] This sentiment was supported in the oral evidence given by the signatories.[23]

17. Given that the scope and content of CPMPs have only now been agreed, it will be impossible to pilot them more extensively until summer 2003. Progress on the development of Crop Protection Management Plans is almost a year behind schedule. This is disappointing. The 2006 target-a 30 per cent uptake-is also insufficiently challenging as evidence suggests that very high levels of take-up are required for the Initiative to be successful. [24]

18. The Policy Commission on the Future of Farming and Food reported in January 2002 on a strategy for a sustainable future.[25] An important recommendation of that report was that the Government should introduce a 'broad and shallow' agri-environment scheme to provide incentives to farmers to manage their land in an environmentally sensitive way. The existing agri-environment schemes provide such incentives but only to a limited number of farmers.[26] The proposed broad and shallow scheme would apply to all farmers, and would also provide an opportunity to rationalise existing schemes within such a framework. It would involve the development of farm management plans and audit arrangements, thus further complicating the bureaucratic requirements to which farmers are subject.

19. We remain concerned about the extensive overlaps with a wide range of other schemes, including voluntary assurance schemes and existing agri-environmental subsidy schemes. These have made it difficult to achieve a consensus on the approach to be adopted. Moreover, the introduction of a broad and shallow agrienvironment scheme, as recommended by the Policy Commission on the Future of Farming and Food, may undermine further efforts to promote the Voluntary Agreement through its own distinctive initiative in this area. We fear that Crop Protection Management Plans may become little more than a paper exercise, and add nothing to requirements already contained in other assurance and subsidy schemes.

20. The appointment of a biodiversity officer, the third pillar of the Initiative, should have been made by July 2001 but did not actually take place until December 2001 - some 5 months late.[27] The signatories told us that a biodiversity network had now been created, and the Crop Protection Association provided us with their new biodiversity strategy.[28] The impact that this may have yet to emerge.

21. With regard to the overall progress being made on the remaining 24 projects which constitute the Voluntary Initiative, Professor Dents' latest monitoring report stated that seven of the projects were late. However, the signatories were confident that the majority of these were now back on track.[29]

Incentivisation

22. While some of the projects within the Voluntary Initiative might help farmers without imposing significant overheads (eg better labelling of products, providing environmental information sheets on products etc), many will require substantial changes in behaviour (eg attending training courses, carrying out regular inspections of spraying machinery etc). Farmers will have to invest extra time, and sometimes money, without any obviously discernible reward. We were therefore interested in how the signatories were proposing to 'incentivise' the Initiative.

23. One possible motivation for farmers is the avoidance of a pesticide tax, and the Steering Group has been keen to 'brand' the Initiative, and the various projects within it, as an alternative to a tax. Indeed, some of the publicity information distributed to farmers refer to the Initiative as "possibly the last chance to avoid a pesticides tax".[30] We were somewhat disappointed at this negative approach and find it difficult to reconcile with the view expressed by the signatories to us that ongoing references to the threat of a tax were unhelpful.[31]

24. In any event, the threat of a tax is unlikely to be enough and it is difficult to see what other carrots or sticks the Initiative can offer to farmers. In their memorandum, English Nature stated that final recommendations on incentivisation had yet to be confirmed: "agreement over a practicable incentivisation scheme and close monitoring of progress against interim targets must be a priority for the Steering Group".[32]

25. The Environment Agency commented critically on progress in this area. "The work of the [incentivisation sub-group] has been poorly focused... An initial report of the group suggested using financial [grants] and regulatory incentives to improve uptake, both of which would no longer make the Initiative voluntary as required by Ministers. There has been inadequate consideration of the more difficult issue of motivating farmers to change practice without the use of such incentives".[33] A final report is still awaited from the Incentivisation group. The Initiative lacks a clear implementation strategy to provide incentives for farmers to alter their behaviour and takeup best practice.

26. We discussed at some length with witnesses what incentivisation mechanisms the Voluntary Initiative contained, and whether incentives should come from within the Initiative or from other schemes outside it.[34] We also warmly support the efforts now being made in the six pilot water catchment area projects. But we are forced to conclude that the Voluntary Initiative does not appear to have, within itself, sufficient 'carrots' to offer to farmers. Nor can it enforce its recommendations with 'sticks' while remaining on a voluntary basis.

27. We doubt whether the Voluntary Initiative can deliver the very high levels of takeup which will be needed for success. We believe that incentives will have to come from outside the Initiative. Cross-compliance with Common Agricultural Policy subsidy schemes, with their audit arrangements to ensure compliance, could provide one of the mechanisms for encouraging widespread adoption which the Initiative itself lacks.

28. We recommend that the Government develops an environmental management strategy for pesticides which sets out the relative contributions and interrelationships between the Initiative, assurance schemes, and both existing and proposed agrienvironmental schemes. Farming desperately needs a more coordinated approach.

Targets

29. Confusion surrounds the issue of targets and indicators for the Voluntary Initiative. The approved proposal of February 2001 listed 28 targets to be achieved over the 5 year period of the Initiative. All of these relate to processes or activities (eg to ensure that all active sprayers are tested by 2006), though some link more directly to pesticide pollution aspects (eg to collaborate with Water UK and the Environment Agency to form a project group with the aim of targeting catchments that face significant problems). These targets correspond closely to the individual projects which constitute the Initiative. They are set out for reference in the following table.

Table: Voluntary Initiative Targets

1. To obtain baseline data on current crop protection practices and equipment that can be used to
influence most other decisions within the package. This to be done within one year.
2. To repeat the survey after four years in order to measure changes that have occurred as a result of
the implementation process and to feedback into future actions.
3. To develop crop protection management plans and to have 30 per cent of arable land using these by
2006.
4. To appoint a crop protection industry biodiversity officer, within 4 months, and to establish this
person as the key conduit for all biodiversity functions.
5. To provide additional support for research on pesticide handling in order to improve facilities on
at least five thousand farms by 2006.
6. To increase commitment, from the crop protection industry, to longterm environmental research
though the UK Foresight Programme.
7. To measure current adoption of ICM/IFM methodologies, by 2003, in order to target future
activities.
8. To increase industry support for the SAPPIO LINK programme, within six months, in order to
increase the focus on sustainability issues.
9. To provide audited environmental information on 1,000 crop protection products by 2006.
10. To ensure that at least 50 per cent of eligible sprayers are fitted with lowdrift nozzles by 2006.
11. To redesign 3,000 product labels (in order to improve clarity) by 2005.
12. To assist in the development of new software to increase environmental awareness for use in a
pilot exercise on 300 farms by 2003.
13. To improve the use of crop protection products on all farms through media and awareness
campaigns by 2006
14. To collaborate with Water UK and the Environment Agency to form a project group with the aim
of targeting 'catchments' that face significant problems.
15. To produce and implement a training resource for crop protection advisers on all environmental
issues by 2006.
16. To produce and deliver a basic training resource for ALL 'infrequent' users of crop protection
products by 2006.
17. To establish a professional register for all spray operators by 2003.
18. To ensure that all 'active' sprayers are tested by 2006.
19. To introduce the use of a code of best practice for the application of sulphuric acid by 2002.
20. To ensure that all agronomist staff working for CPA members have an awareness of
environmental issues and are on the BASIS professional register. This to be achieved by 2003.
21. To implement an audit process for environmental training within CPA member companies by
2003.
22. To promote and increase awareness of LERAP requirements by farmers & growers. This to be
achieved by 2002.
23. To significantly improve application standards for crop protection products within the amenity
sector by 2004.
24. To establish new initiatives to improve and maintain biodiversity in farmland habitats by 2003.
25. To produce a code of practice for the use of insecticides in crop protection by 2004.
26. To complete a national retrieval scheme for 'expired' products by 2004.
27. To complete a lifecycle analysis of crop protection product packaging by 2002.
28. To establish a CPD scheme to improve the competence of farmers making decisions on the use of
crop protection products and to have 50 per cent, of those eligible, registered by 2006.

Source: Voluntary Initiative approved proposals, February 2001

30. The Environment Agency commented that "some of these targets, eg that all spray operators should be members of a professional register by 2003, were ambitious and promised a large scale improvement in practice with resultant environmental benefits. They were one of the main reasons why the Agency supported the introduction of the programme as an alternative to a pesticides tax. It has become evident in the process of drawing up success indicators that the signatories are now looking to backtrack on some of these targets since they now realise that they will not be met".[35]

31. The original 28 targets set as part of the Voluntary Initiative relate mainly to processes rather than environmental outcomes, but are nevertheless important. They are challenging and, as the example of the professional register of spray operators shows, the signatories appear to have underestimated the task of achieving them.

32. The approved proposal also identified five indicators by which to measure changes brought about by the Voluntary Initiative.[36] These were to be:

a new indicator for water quality;

an indicator for cereal margins under environmental management;

an indicator of the adoption of new technology in farming;

an indicator of the training of agronomists; and

an indicator of the training of operators.

33. Professor Dent explained to us how he had come under some pressure from the Minister to develop targets and indicators to measure the environmental impact of the Initiative.[37] This creates confusion over the basis on which performance is to be monitored, as the Government had already agreed a set of targets in approving the original package. Professor Dent also found it conceptually difficult, as the Steering Committee was being asked to audit the Initiative against targets which it was itself responsible for developing.[38]

34. The solution he had proposed to this dilemma was to base new indicators on the outcome of work already being undertaken by the Pesticides Forum. The latter had already published in 2001 a detailed report highlighting over 50 possible indicators which could be developed or used in order to measure accurately the success of the Forums' work.[39] On the basis of this work, the Steering Group had drawn up a list of some 17 indicators, together with baseline data for April 2001 and any associated targets. These indicators covered not only process aspects of sprayer application, but also environmental outcome measures. They supersede and effectively include the 5 originally proposed. Importantly, they now include a target for a 30 per cent reduction in detection of pesticides in water. The Steering Group has sent this proposal to the Minister and is awaiting his response.

35. The original targets did not adequately address the direct and indirect effects of pesticides on the environment. We endorse the efforts of the Steering Group, in response to pressure from the Minister, to develop a more comprehensive set of indicators and targets. We are concerned, however, that-more than 18 months into the initiative-these have still not been finalised. Even the latest proposals do not include any indicators for the overall area sprayed, or for the weight and type of substances used - two measures we consider could usefully be included. Indeed, in our earlier report on pesticides, we recommended that there should be far greater disclosure and monitoring of such information.[40]

36. Professor Dent's concern over the influence the Minister has exerted appears justified. This intervention has resulted in confusion as to which targets the success of the Initiative should be measured by. It has also placed the Chairman and the Steering Group in the difficult position of auditing themselves against targets they themselves have set. We recommend that the Government clarifies the criteria it intends to use to assess the effectiveness of the Initiative immediately. The absence of such clear criteria is an issue we have ourselves raised with the Treasury on previous occasions.[41]

Monitoring and resources

37. The Steering Group published its first Annual Report on the Voluntary Initiative in June 2002.[42] We were struck by the absence of any hard monitoring data within that report-either in terms of facts and figures about the use of pesticides and their environmental impacts, or in terms of a formal monitoring of projects against targets and deadlines. Professor Dents' own confidential reports to the Minister do contain brief comments on each project, but even then they do not set out with sufficient clarity performance against targets. While there is very considerable information on the Voluntary Initiative website on individual projects, this is not summarised or brought together in any publicly available form.

38. We consider it essential that the Steering Group should monitor progress of the Initiative against the approved targets, notwithstanding any other targets or indicators it might set. The next annual report must set out clearly progress in this respect. It should also contain analysis of progress against any other targets which have subsequently been agreed with Ministers.

39. On the issue of available resources, a pesticides tax had been expected to raise some £130 million a year, and could have been used to finance through hypothecation a substantial programme of research and development of best practice.[43] An important factor in the Governments' decision to approve the Voluntary Initiative, therefore, was the proposed resources which signatories would deliver. These were supposed to amount to £11.9 million over the five year period. In addition, compliance costs of farmers were estimated to be over £11 million a year.[44]

40. Professor Dents' latest monitoring report states that the signatories had spent £2.3 million to date-somewhat less than was anticipated-while costs to farmers have so far been negligible. We note that Professor Dent, however, appears to be reliant on the signatories for estimating such costs, and he suggested that they could do more to improve transparency in this respect.[45] At present, little detailed information is available about the costs which signatories claim to have incurred. We recommend that there should be far greater transparency and accountability with regard to such costs, and that this information should be included in the annual report.

41. The Crop Protection Association stated that nearly 50 per cent of their staff time was devoted to the Initiative. Given the lack of transparent accounting over costs, it is difficult to reconcile this with their admission that they have not recruited any extra staff, other than the biodiversity officer within Crop Protection Association, to implement the Initiative. The extent to which claimed expenditure by the signatories constitutes 'real' costs over and above any costs which they would otherwise have incurred, even in the absence of the Initiative, should be made clear.

The 'partnership' approach

42. In the light of some of our comments above, we are concerned that the roles and responsibilities of the Chairman and the Steering Group were not clearly laid out by the Government at the outset. We also find it extraordinary that, after approving the Voluntary Initiative proposals submitted in February 2001, the Government should have sought to move the goalposts in respect of targets and indicators of success. Moreover, there was a six month delay on the part of the Government in agreeing a name for the initiative, and witnesses told us that this had adversely affected the promotion of the Initiative.[46]

43. We were alarmed to hear that Professor Dent is only contracted to work for eight days a year as independent Chairman of the Voluntary Initiative Steering Group.[47] To coordinate and monitor such a large and complex project as the Voluntary Initiative clearly calls for a far greater resource input than this. We appreciate that the actual time Professor Dent has devoted is far in excess of this, and we welcome his refusal to accept any financial support from the signatories.[48] The department must clearly put its money where its mouth is, if its miserly approach is not to be seen to reflect the extent of its commitment to the Initiative.

44. We also find it bizarre and deplorable that Department for Environment, Food and Rural Affairs had commissioned a review of the success of the Voluntary Initiative without even having the courtesy to inform Professor Dent.[49] Such behaviour is clearly unprofessional. But it is also particularly inappropriate insofar as the independent Chairman is himself responsible for monitoring the progress of the initiative on behalf of the Minister. In commissioning a review, Department for Environment, Food and Rural Affairs are therefore effectively undermining-whether intentionally or not-the role and authority of the independent Chairman. There is also a particular irony in the fact that the department is prepared to spend money on this study, while failing to provide adequate resources for the Chairman himself.

45. More generally, there appears to be a lack of joined-up thinking in Government to produce an array of policies in related areas which will complement and reinforce the Voluntary Initiative. Indeed, a number of the submission we received emphasised the need for the Government to develop a comprehensive strategy which went far wider than the Initiative itself.[50] The development of Crop Protection Management Plans, for example, is closely related to similar requirements in a range of voluntary and departmental schemes. Professor Dent emphasised the complete failure on the part of the department to engage in a dialogue with the Steering Group on such issues.[51] Moreover, he noted with concern how responsibility for the Voluntary Initiative had moved through central sections of Department for Environment, Food and Rural Affairs and now to an agency of Department for Environment, Food and Rural Affairs which is based in York.[52] Ministerial responsibility for this policy area has also recently shifted from the Minister of the Environment to the Parliamentary Under-Secretary (Lords).

46. The Government initially made much of the 'partnership' approach it was to pursue with regard to the Voluntary Initiative.[53] But any such claim now is clearly untenable. Department for Environment, Food and Rural Affairs has failed to engage in any serious dialogue with the Steering Group on cross-cutting issues, and has even undermined the role and authority of its Chairman. The evidence provided to us showed that the Chairman and Steering Group are isolated-and indeed alienated-from the department.

Overall strategy and conclusions

47. Pesticides are a major source of environmental pollution. In our previous report on the subject, we highlighted the large costs of removing pesticides from water supplies, amounting to hundreds of millions of pounds each year, which ultimately fall on consumers. They represent a significant subsidy for intensive agriculture and unfairly discriminate against organic produce.[54] Moreover, there is also considerable concern about the possible indirect environmental impacts of pesticides-about which relatively little information is available.[55] We welcome, therefore, the action being taken to reduce the impacts arising from the use of pesticides.

48. However, the environmental organisations we took evidence from made it quite clear that if takeup by farmers remains poor, the Government should not wait until the end of the Initiative before taking appropriate action.[56] In considering such arguments, we came to the following overall conclusions:

(a) The Voluntary Initiative has got off to a rather slow start. It has so far had little impact on farmers as much of the work done to date has involved preparation and groundwork. The Initiative is now beginning to be rolled out to farmers and the next year will be critical.

(b) We are, however, very concerned that the Voluntary Initiative does not have within itself sufficient incentives to ensure the high level of take-up required. Nor, being voluntary, can it require farmers to change their behaviour. In addition, there is little emphasis within the Initiative on reductions in the use of pesticides and on encouraging alternative approaches.

(c) On the other hand, it is perhaps too early to judge whether the Voluntary Initiative has been a success. We therefore consider that it needs to be given further time, and that at the end of 2003 a thorough and realistic appraisal of its success should be carried out.

(d) But it is already clear that the Voluntary Initiative should represent only one aspect of a more comprehensive strategy towards reducing the environmental impacts of pesticides. Moreover, many of the activities within the Initiative would need to be carried out in any event as part of an overall strategy, and will depend for their effectiveness on the adoption of a joined-up approach. Indeed, there is a widespread consensus, reflected in research studies and the evidence presented to us, that reliance on a single policy measure to achieve any environmental objective is unlikely to be successful, and that a combination of policies are generally required.

(e) The Government must therefore, as a matter of urgency, develop and publish a pesticides strategy. Such a strategy should show how different policy instruments-including the use of fiscal instruments, a strong regulatory framework, the Voluntary Initiative itself, and cross-compliance with subsidy and assurance schemes-are to be used to complement each other and achieve a reduction in the environmental impacts of pesticides.

(f) We believe that fiscal instruments have an important part to play in such a strategy. They could provide, through hypothecation, far more resources than are currently available within the Voluntary Initiative. They could be designed to provide rebates to farmers who adhered to more stringent environmental guidance; and to discriminate much more heavily on products in relation to the extent of environmental damage they cause. However, as we highlighted nearly three years ago, the Treasury and Department for Environment, Food and Rural Affairs need to undertake more research in this area to prepare for the introduction of practical proposals. They must do so now.

(g) The Government is currently considering major issues relating to agricultural policy-both in its response to the Policy Commission on the Future of Farming and Food and in relation to the EU midterm review of the Common Agricultural Policy. It will be releasing a sustainable agriculture strategy very shortly. This would provide a context within which our recommendations in this report can be taken forward.

1 HM Treasury, Statement of Intent on Environmental Taxation, July 1997. Back

2 eg (i) Economic Instruments and the Business Use of Energy, A report by Lord Marshall, 1998; (ii) Design of a Tax or Charge Scheme for Pesticides, Ecotec, 1999. Back

3 As part of its regular series of inquiries on the Government's Budget and Pre-Budget Reports and the progress being made against the Statement of Intent, the Environmental Audit Committee considered in detail these three areas in its Fourth Report, The Pre-Budget Report 1999: Pesticides, Aggregates and the Climate Change Levy, HC 76, 1999-2000. Subsequent Committee reports include additional comments: see Fifth Report, Budget 2000 and the Environment, HC 404, 1999-2000; and Second Report, Pre-Budget Report 2001: A New Agenda?, HC 363, 2001-02. Back

4 EAC Pre-Budget Report 1999: Pesticides, Aggregates and the Climate Change Levy, HC76-II, 1999-2000, Ev 233 Back

5 idem, HC 76-I, 1999-2000, para 12. Back

6 The Potential Cost and Effectiveness of Voluntary Measures in Reducing the Environmental Impact of Pesticides, DEFRA, February 2002. Although not published until 2002, the study was carried out in late 2000. Back

7 The approved proposal (hereafter referred to as the Voluntary Initiative approved proposal) can be found on the Voluntary Initiative web site at: http://www.voluntaryinitiative.org.uk/Content/Programme.asp . Back

8 Representatives from several government departments and from the devolved administrations attend as observers. Back

9 Eg Environmental Audit Committee, Pre-Budget Report 2001: A New Agenda, HC 363-I, 2001-02, paragraph 18. Back

10 EV35. Back

11 Budget 2002, HM Treasury, April 2002, HC 592, 2001-02, paragraph 7.78. Back

12 eg the Advisory Committee on Pesticides, and the Pesticides Safety Directorate. Back