Examination of Witnesses (Questions 106
- 119)
TUESDAY 4 JULY 2006
MR JAMIE
BLACKETT, MR
ANDREW BROWN,
MRS GILLIAN
HERBERT AND
MR GUY
SMITH
Q106 Chairman: Good morning, ladies
and gentlemen. Can I welcome you to this formal evidence session
being held by the House of Commons Environment, Food and Rural
Affairs Select Committee as part of its inquiry into the document
which the Government published last December, A Vision for
the Common Agricultural Policy. By way of background, the
Committee has already conducted a number of evidence sessions
involving the major farming unions, landowners, and those organisations
concerned with the environment of the countryside. In addition,
it has made trips to Poland, Romania, France and Germany to talk
about some of the politics and practicalities of the CAP and to
get a European perspective on how other people look at the question
of the Agenda for Change. The Committee thought there could be
no finer place to come and hear directly from those involved in
the land themselves, and so we decided that we would have a very
special, and, in fact, unique to this Committee, evidence session
here at the Royal Show. Through the assistance of the Farming
Press, and I think particularly Farmers Weekly, a number
of farmers have very kindly volunteered to come and give us their
evidence in this particular session. This is a formal session
of the Committee, and I would like to put on record my grateful
thanks to Tracy, this young lady here, who is from Gurney's and
is taking down every word which is said as a formal part of our
evidence. The only thing I would say to witnesses is that once
you have spoken it is on the record, you cannot undo that which
you have done, but if afterwards when you wake up tomorrow morning
you think, "Oh, gosh, I wish I had said that", whatever
"that" may be, do please write to us and let us know
whatever "that" might be. We have got three panels of
witnesses, roughly speaking 40 minutes for each. The instruction
basically is that we have invited those witnesses, some of whom
have been kind enough to put forward in writing some of their
views, to give a five minute presentation which leaves the Committee
time to ask each one of them a few questions. If everybody is
very crisp and there is any time leftover—we have, in fact,
got four on the panel as opposed to five, one of witnesses, Mr
Davenport, for personal reasons could not be with us—we
will obviously deploy that in asking additional questions. In
terms of those who are giving evidence, we will start with Mr
Jamie Blackett, who runs a family farm, mixed arable, beef, and
sheep on two sites in Yorkshire and Dumfriesshire. He will be
followed by Andrew Brown, who farms 620 acres of mixed arable
and pasture in Rutland, and he is a farmer with over 20 years'
experience. The next is Mrs Gillian Herbert, who started farming
in 2003 and supplies rare breed lamb and pork from a small farm
near Bromyard in Herefordshire. I notice that she used to be a
PA to the owner of the McLaren Formula 1 motor racing team. As
someone who has a passion for that, perhaps they need your help
still, Mrs Herbert, judging by what happened on Sunday. Finally,
we have Mr Guy Smith, who is a farmer and commentator on farming
issues based in Essex. Without further delay, Mr Blackett, would
you like to give us the benefit of your five minutes.
Mr Blackett: We were briefed to
be quite brief with our introduction to allow time for you to
ask questions, so very briefly about myself. I farm just over
1,000 acres, mainly in Scotland, which is fortunate because I
think it is a country which still values its agriculture rather
more than England does, and that is something which is seen in
policies north of the border. I farm in arable and beef but I
am also diversifying into tourism and shellfish. My perspective,
briefly, is I felt the mid-term review started out well but ended
up being a bit of a shambles in that the whole thing was supposed
to get simpler and has actually got a lot more complicated. This
is something which needs to be addressed next time round. I would
like to see a world free of support payments, but unfortunately
we still need subsidies in this country because in many cases
we are selling our agricultural commodities for less than the
price of production. This is something that politicians worldwide
have engineered, partly through giving subsidies and partly by
allowing, particularly in this country, cartels to govern food
retailing. In working towards a subsidy-free world we need to
look very carefully at making it a level playing field, and certainly
from our perspective in this country it is not level. My major
concern is that all the major parties seem to lean towards a policy
of unilateral disarmament of subsidies partly through modulation
and other means, doing away with subsidies in this country to
our great disadvantage. Finally, in eventually dismantling the
CAP, I would like to be given the freedom to innovate, to grow
my business, and be free of bureaucracy which at the moment I
am not.
Q107 Chairman: Thank you very much
for that succinct introduction. When you say you want to do away
with subsidies, one of the things we have encountered is the move
from pillar one to pillar two, and one of the first things we
did here was to look at English Nature's display of environmental
stewardship which represents a payment to farmers for delivering
environmental goods, does that go into your box labelled "subsidy"?
If you are asked to deliver environmental goods, will you do it
for free?
Mr Blackett: I certainly cannot
afford to do it for free. We have gone into the Rural Stewardship
Scheme which is north of the border, I have not done it in England.
Levels 1, 2 and 3, certainly I am all for environmental benefits,
but they are all ways of giving us money in different ways. We
should not kid ourselves, all it is is rearranging the deckchairs
slightly.
Q108 Mr Williams: Now that agricultural
support is decoupled and not focused on production, there is an
argument that we could repatriate the Agricultural Policy so we
have a British Agricultural Policy rather than a Common Agricultural
Policy, would you support that?
Mr Blackett: I would support it
if I had a bit more trust in you lot! I would like to see a bit
more repatriation north of the border because it alarms me that
it is Westminster that is negotiating with Europe for Scottish
farmers when I think Scottish politicians have shown that they
understand the rural economy slightly better. If repatriation
of the Agricultural Policy is just another way of saying unilateral
disarmament, we will pull out of Europe in the sense of the CAP,
and our farmers will be worse off, then I would not support it.
Q109 Mr Drew: Can I tease out this
differential between England and Scotland. Are you thinking principally
because Scotland has stayed with the historic system which, of
course, is a system that will inevitably lead to problems elsewhere
in Europe as other parts of Central and Eastern Europe come into
it and we increase a dependency culture?
Mr Blackett: Yes, it is principally
because the Single Farm Payment in Scotland is a lot easier to
implement, a lot less bureaucratic and, therefore, probably a
lot cheaper to administer than in England. It is not just that,
I think SERAD employs people who understand agriculture whereas
Defra, as far as I can see, does not. There are numerous other
small policies where they try to be helpful in the way that some
of the cross-compliance rules are implemented.
Q110 Mrs Moon: You said that you
have a desire to be free to innovate, can you tell us a little
bit about what that would mean if you had that freedom? In what
way would you innovate?
Mr Blackett: A lot of my time
is spent filling in forms or having pointless discussions with
civil servants. I am diversifying in lots of different ways, and
I would have more freedom to do that if I was not so heavily regulated,
if I did not lie awake at night worrying about whether my cattle
had got out and were grazing in the wrong field because it happened
to be in set-aside, or whether we ploughed too close to the hedge
in one field and are going to be penalised or have not in another
field. I do not think a manager of one of Stalin's collective
farms would have had to put up with as many regulations as we
do.
Q111 Mrs Moon: I did not get a response
about the innovation.
Mr Blackett: The innovation is
that we are trying to diversify and build new businesses on our
farm.
Q112 Chairman: Give us a flavour
of what those would be? What kinds of businesses are we talking
about?
Mr Blackett: We have gone into
the holiday letting market, and I am trying to start a shellfish
farm, an aquaculture project with mussels, oysters and cockles.
I am fortunate in that obviously we live on the coast and I can
do that; I appreciate that not everyone can. These are all different
ways that we are going to feed the world in this century. It is
extremely difficult to be an entrepreneur in this country when
there are so many civil servants blocking your every move, and
when the actual business of farming takes up so much time because
of all the regulations.
Q113 Lynne Jones: Can you give an
example of civil servants blocking your innovation? Why do you
think it is that the cohort of people who are employed by regulators
in Scotland are that much more sympathetic than the cohort of
people in England?
Mr Blackett: To answer the first
part of your question in terms of the government agencies, the
Environment Agency in England, SEPA in Scottish, Scottish Natural
Heritage and their English equivalent, they block every single
planning application that we make. We will get there eventually,
but there are delays which go on in dealing with all these different
agencies. I think we are all in favour of doing away with pollution
and all these things but all these agencies do more harm than
good now. We farm in a very sensitive, clean way compared with
many parts of the world, and to get it that 1% better we are doing
a lot of disproportionate harm to our industry.
Q114 Lynne Jones: We have not got
time to go into it, but can you, perhaps, write to the Committee
with one or two examples of where you think unreasonable decisions
have been made?
Mr Blackett: Yes.
Chairman: Very quickly, a question from
David Taylor and then from Peter and Jamie can take them together.
David Taylor: Jamie, in your written
evidence you referred to the possibility of recreating, for instance,
the Milk Marketing Board. We have a major deficit internationally
with processed dairy products, do we not, and you have talked
about the freedom to innovate. Why have dairy farmers not innovated
in the ways that you suggest they ought to, to remedy that imbalance?
I know you are not a dairy farmer yourself.
Q115 Sir Peter Soulsby: Again, in
your written evidence you talked about the need for the balance
to be tipped by the government towards biofuels, I wonder if you
would like to say a little bit about what you think will be necessary
to tip that balance?
Mr Blackett: The first thing is
in terms of innovating, not every farmer is able to exploit these
niche markets because if they did they would ceased to be niche
markets, if that is what you mean by what dairy farmers should
do. The other thing is that in this country we have allowed ourselves
to have the structure of our food markets skewed in favour of
the retailers. We have got a supermarket cartel that is dictating
the price to the extent that dairy farmers, in particular, are
selling their product at less than the cost of production. In
order to overcome that I think you should look at other ways.
The Milk Marketing Board will obviously be going backwards to
an old system, but some sort of system like that where farmers
are able to grab a fairer share of the value chain. It has not
happened on a voluntary basis for all the talk we have had over
the last few years, so it is going to have to be done through
some sort of regulation. Looking at biofuels, we have missed a
golden opportunity in this country to get in at the beginning
of this industry. Gordon Brown steadfastly refused to lower the
duty on biofuels to the point where they became viable where people
would have invested in the necessary crushing facilities and plants.
It is now starting to happen but very belatedly. Fuel is one of
the biggest disadvantages in this country. Okay, we have red diesel,
but every time we call a vet out or get a spare part for the combine,
it comes via fuel on which the full duty has been paid. All this
talk about climate change, the fuel duty escalator, and all the
rest of it, is just hot air if this Government is not prepared
to get biofuels off the mark with a reasonable chance by altering
the fuel duty on them.
Q116 Chairman: Thank you very much
for the crispness of your answers and the focus of its content.
We move on to Andrew Brown.
Mr Brown: Thank you, Chairman.
The issue I would like to raise is the future incentivisation
of energy crops and biofuels by the CAP and the EU. Crops such
miscanthus and short rotation coppice attract establishment grants
which are generally taken by the end purchaser, and then there
is a gap of up to four years before any realistic yield is gained,
therefore, the farmer gets no income from it for four years. I
have recently heard that establishment grants for these crops
are being suspended as of 31 July. I have looked closely into
growing miscanthus but came to the conclusion that it was not
viable. Currently, the EU is offering €45 per hectare for
crops such as oilseed rape and wheat for biofuels, of which the
farmer receives €22.50 because the merchants and processors
take the other €22.50. In the case of wheat, this equates
to an extra £1.50 a tonne to the farmer. Whilst this is a
welcome extra, it is not going to influence my decision on whether
or not to grow combinable crops for biofuel if the price is dropped
back to recent low levels. It does rather take the shine off it
when huge multinationals such as Cargill take half the incentive
in a spurious administration charge. Companies are investing in
the biofuel market and energy crops, but without sufficient incentive
to kick-start it we are going to be left dead in the water compared
with Brazil, for instance, who started the process back in the
1970s, and EU countries, such as Germany and Austria, who seem
to be 10 years ahead of us. It may be the case that it is cheaper
to import biofuels from Brazil, Malaysia or India rather than
growing them in our temperate climate, but there is no point whatsoever
in paying us to look after the countryside here whilst halfway
around the world other people are destroying the rainforests just
to supply us. Oil companies seem to have little concern for the
environment and absolutely none for the rural economy. In the
future not only do we need to see low food miles, we must also
be looking at low fuel miles by getting locally sourced fuel grown
in a sustainable way to high environmental standards, and by ensuring
the oil companies get the 5% biofuel element in their products
from EU Member States and not by exploiting cheap imports from
non-EU countries. We have got half a million hectares of set-aside
in the UK and as farmers we want to farm it. Surely we must be
able to use this to reduce our reliance on tinpot dictatorships
for our fuel supplies. Through the CAP we have the opportunity
to get things started now to safeguard our future.
Q117 Chairman: Thank you very much
indeed. In your evidence you made an interesting observation about
the balance between that passionate statement about the factors
which are affecting the supply of biofuels and the effect that
would have on food supply, would you like to develop that juxtaposition
point which you made?
Mr Brown: If global warming gets
going to the extent that some people are saying it is going to,
in the future is there going to be a situation where we are going
to have to choose between growing food and growing fuel? If the
south part of Europe starts turning into a desert, obviously countries
like ours, temperate climates are going to have to produce more
food. You have got to have one or the other, obviously you cannot
have both from the same piece of land.
Q118 Mr Drew: Can I take you up on
that point. When we looked at our inquiry into biofuels clearly
one of the issues is the worry that there could be monoculture,
what is to stop that from happening, and as a corollary of that,
the issue of education amongst farmers, to the extent that they
would be sensitive to how they could move towards non-food crops?
Mr Brown: Obviously we have got
to strike a balance between the two. You cannot incentivise one
too much at the expense of the other. In my opinion it has got
to be a very fine dividing line. What the answer is exactly, I
do not know.
Q119 Lynne Jones: I am concerned
that you say it is not worth the effort to grow miscanthus and
short rotation coppice, particularly because of the carbon saving
from biomass as opposed to biofuel is much greater. I understand
the four year problem, but what would you like to see done about
it? There is a lot of emphasis on biofuels for transport, but
a third of our energy nationally is going on heat, and we could
get far more carbon saving if we went to biomass energy for heating
or, to some extent, energy generation than for transport.
Mr Brown: Yes, if we can get back
to small energy production in local towns and villages, years
ago they used to have a gas plant in every village, which presumably
produced gas from coal and turned it into coke. We have got to
get local production of miscanthus and short rotation coppice
so that we do not take it more than 20 miles. If we take it more
than 20 miles we have lost all the environmental benefit by burning
the fuel on the road. Another problem with miscanthus certainly
is that the purchasers want it at 16% moisture, and basically
it is like making hay in March, which, as you can imagine, is
quite difficult. Apparently the average moisture content in this
country is about 50% and the best you can get is 25%, so if you
have then got to dry it before you can use it as fuel, you are
wasting your time.
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