Examination of Witnesses (Questions 145
- 159)
TUESDAY 4 JULY 2006
REVEREND ROBERT
BARLOW, MRS
JILLY GREED,
MR ROGER
JAMES AND
MR JOHN
TURNER
Q145 Chairman: We welcome four new
witnesses. Can I introduce the Reverend Robert Barlow, the agricultural
chaplain, I was going to say from Worcestershire, but that perhaps
extends your theatre of responsibility too wide, whereabouts in
Worcestershire?
Reverend Barlow: My responsibility
is for the whole of the Worcester diocese, which is Worcestershire
but not Tenbury Wells, which, for some reason, gets lumped in
with the Hereford diocese, but also includes up into Dudley, the
Black Country. One of the joys I have had is being able to go
into urban areas and talk about some of the issues in rural areas
and in agriculture.
Q146 Chairman: Thank you for that
geographical clarification. We have Mrs Jilly Greed, who is a
beef farmer with a closed herd of 200 suckler cows on a 500 acre
family farm in the delightful county of Devon; Mr Roger James,
a hill farmer in mid-Wales, who is responsible for 1,000 breeding
ewes, producing 1,500 lambs and 50 suckler cows; and Mr John Turner,
who farms a mixed 100 acre organic farm of beef, sheep, cereals,
medicinal herbs—just have a look at the Committee to see
if we need any help—near Stamford in Lincolnshire. We had
hoped to be joined by Mr Richard Stubley but I understand that
for personal reasons he has not been able to join us. You are
extremely welcome. If we can start this time with Reverend Barlow.
Reverend Barlow: My work brings
me into close contact with agriculture. I would not dare to claim
to speak on behalf of farmers nor to represent them, but I believe
I have a pretty accurate picture of how the industry feels. Among
the farmers I meet there is a significant number who would welcome
an end to the whole subsidy system if, in return, they had that
level playing field which you write about in your report. If there
was fairness in agriculture I think many would be happy to see
the end of subsidies because UK agriculture has got much going
for it. It has got a good climate, rich soils, skilled farmers
and a market of 60 million, as we heard, on its doorstep. If everything
were fair and equitable then our farming could compete with the
best in the world. For that fairness there needs to be consistency,
both across the EU and beyond the EU. An example of inconsistency
would be the different circumstances that beef and dairy producers
in Worcestershire find themselves in in comparison with those
in Ireland. In Worcestershire, TB is endemic in wildlife and that
adds enormous costs to the dairy and beef industry in trying to
have bio-security measures to make sure that their animals do
not catch TB, or the additional costs which occur if and when
their herds go down with TB. In Ireland it is different because
they have had a resolute cull of TB in wildlife and they do not
have all those additional costs. Another example of inconsistency
would be with egg production, we have heard a little bit about
that. The EU Directive 99/74/EC has meant that in this country
we have had to tool up with new cages of a higher standard; that
has not been implemented in the same way in the rest of Europe.
I understand that not only has the rest of Europe avoided those
costs, but the Spanish egg industry has been able to expand, buying
up cheap second-hand equipment from the UK which does not do any
good. Exporting production does not solve welfare issues. Likewise,
stalls and tethers with pig meat, we have heard about that. As
with animal welfare there are questions about environmental standards.
The Water Framework Directive is to be welcomed if it cleans up
the rivers in this country and the Thames, the Severn and the
Avon are all clean, but not if that is only done by putting additional
costs onto UK farmers so that we end up polluting the Seine, the
Rhine and the Danube or the Mississippi, the Amazon and the Plate.
I heard somebody speaking just over a year ago and he was telling
me that he was standing at the mouth of the River Plate, a great
wide expanse of water going out, and it was dark brown with the
silt soil that had been washed off. It is the kind of standard
which would not be acceptable in this country. As we are putting
so much money from Europe into agri-environment schemes it would
seem bizarre if we end up wasting it by transferring production
to places where animal welfare or environmental standards are
not so high. There needs to be a consistency across Europe and
beyond for fairness and for farming to compete. The second area
where there needs to be fairness in farming is in respect of the
market. We say that we all believe in the free market but I sometimes
wonder whether the market is free as Adam Smith meant when he
wrote In the Wealth of Nations. He talks there about multiple
producers and multiple buyers and we simply have not got that
both in this country and the world, we have countless must-sell-producers
and a handful of might-buy-buyers. The Competition Commission's
investigation into the role of supermarkets has been affirmed
in their positive role in terms of prices for consumers, but as
one Oxfordshire farmer said, "There are 200,000 farmers dealing
with basically three supermarkets, two grain merchants, four fertiliser
companies, not a chance. They have got power, real power".
That is not a level playing field. Worldwide, six corporations
handle about 85% of the trade in world grain, eight corporations
account for 55 to 60% of world coffee sales, seven account for
90% of the tea consumed in Western countries, three account for
83% of the world trade in coco and three account for 80% of the
world trade in bananas. The long-term effect of world food trade
being dominated by a handful of large companies both in the UK
and overseas has to be questioned in terms of its effects on producers,
the environment and animal welfare. We ought to remind ourselves
that there is a demand for food. There are 850 million people
in the world who have an inadequate diet, there are 25,000 people
who will die today, and 25, 000 who will die tomorrow and the
day after and the day after that because they do not have enough
to eat. A market which is truly free and gives freedom to our
producers and producers worldwide to meet that demand would be
welcome. A market that gives freedom to a handful of companies
to exploit differences in environmental standards, living standards
and animal welfare is not the free market of Adam Smith. With
consistency across Europe, across the world, and a market free
from the stranglehold of a few companies, there can be an excellent
unsubsidised future for UK agriculture. Finally a plea, getting
from where we are now to where you want to be in 10 or 15 years'
time will involve tremendous change for those in the industry.
I would urge that during that transition, which I hope we will
make, you will make support available in terms of realistic funding
to the various agencies that work to provide help to stressed
and distressed farmers.
Chairman: Thank you very much indeed.
Q147 David Taylor: In your written
statement, and I do agree with a lot of it—as a Christian
in a rural village I wish you were the chaplain in our area, and
perhaps we will try and send a transfer fee for you—you
talk about 800 million people who do not have an adequate diet,
which is an affront to any God of any religion. Early on in that
submission you also talk about foot and mouth being eradicated
at an horrendous cost to the UK industry and government. Does
not God, any God, also want to avoid cruelty to all living beings?
Was that an appropriate approach to get rid of foot and mouth?
Were we not in a position when the NFU at national level were
urging on the government, amongst others, to go for their culling
policy where many individual farmers in areas like ours were perplexed
by this policy? Is there not a gap between the way in which farming
is represented at the national level and some of the many people
who are doing their best to provide at the local level? Do you
not see that gap?
Reverend Barlow: I said at the
beginning that I would not dare to speak on behalf of farmers.
Q148 David Taylor: The rural community
then?
Reverend Barlow: I think you can
put three farmers is one room and end up with four different opinions.
There will always be people who have different views about how
foot and mouth was handled and whether it was done appropriately
or inappropriately. I always remain aware of the tremendous personal
cost to all sorts of people involved, both farmers and those involved
with MAFF.
Q149 David Taylor: And the millions
of animals?
Reverend Barlow: I have a concern
for animals as well. I do not think we need to be over-sentimental
about animals, and I get concerned with some of the more extreme
things that seem to come from the animal welfare lobby. Whether
we handled foot and mouth, or whether you handled foot and mouth,
well or not we can debate at length, the point I made in my written
submission is that it is handled differently in this country as
it is in Brazil. Those costs are borne not just by government—obviously
it put tremendous costs on government—but there were tremendous
costs on farmers, many of whom were caught up in the whole thing
but were not involved with the compensation of it.
David Taylor: In particular, Chairman,
I welcome—and this is a statement, not a question—the
Reverend Barlow's perspective on this. There are moral issues
involved here, and there is a spiritual dimension which is in
this submission which I think is very worthwhile and useful.
Chairman: Perhaps that is why it is called
"A Vision for CAP Reform".
Q150 Mr Williams: Your analysis of
world trade in commodities rightly highlights the fact that we
have got many I think you called them must-sell-producers and
a few might-buy larger companies, but trade is not free also because
we have got export subsidies and import tariffs as well. Would
you like to comment on whether we should be getting rid of export
subsidies in the European Union, in the CAP, and whether we should
be reducing import tariffs which we are told have a terribly detrimental
effect on Third World countries?
Reverend Barlow: In an ideal world
I would like to see an end to all subsidies, it is a question
of how we cope in an un-ideal world. My personal view would be
that for the average farmer in this country the distortion of
the market caused by the handful of transnational corporations
that dictate price is much, much more of an effect on the freedom
of the market than import and export subsidies; I think they are
peripheral and secondary. The major distortion of a market which
is truly free is that there is dictation of price by those who
hold power and, incidentally, who have accountability to nobody.
In theory the large corporations are accountable to shareholders
but that is pension funds, and there is not the ethical and spiritual
dimension brought in to question how those things happen. You
are accountable to your electorate but here you are dealing with
corporations and many of them have an economic activity larger
than small countries and seem to be accountable to nobody.
Q151 Mr Williams: As I understand
it, you are advocating fair trade as opposed to free trade because
the circumstances do not allow free trade to take place. Would
you advocate fair trade for British and European farmers as well
as for Third World farmers?
Reverend Barlow: I would advocate
fair trade for everybody, you cannot make a distinction between
the UK and overseas. With the advantages that we have of our good
climate, our good soils, our skilled labour force and a market
on the doorstep, if it were fair I think our agriculture would
flourish. I see a lot of very good farmers who if they were not
fighting against prices which are set for them that they cannot
produce to would be very happy.
Q152 Chairman: Thank you very much
indeed. We now move on to Jilly Greed.
Mrs Greed: Thank you. First of
all, I would like to say well done to the Committee for coming
here to the Royal Show and hearing our submissions and evidence.
I would perhaps like to take it one stage further and offer a
warm invitation to come down on our farm, if you would like to,
and see some of the good things we are doing and also some of
the difficulties that we have effectively on the coalface. I am
very passionate about my farm and farming, and I am very concerned
about the way in which farming is being marginalised. What I want
to talk about is the beef suckler industry and also the impact
of international global trading, and I experienced a trip to South
America earlier this year which opened my eyes. Briefly about
the farm, I am a fourth generation farmer in Devon, farming with
my husband Edwin on a 500 acre family farm. It is in the river
valleys of the Exe and Culm which are both flood plains. Every
single field on our farm is in a NVZ, a Nitrate Vulnerable Zone,
and we are also in a SSSI, a site of special scientific interest,
so we have strict environmental regulations. We have got 200 herd
of beef suckler cattle, breed specific, South Devons, a traditional
breed, and Blonde d'Aquitaines. We also produce arable crops,
split 50:50 between feed and also energy crop in the form of oilseed
rape. We are in the Countryside Stewardship and also in the Environmental
Level Stewardship as well. I have to say, we have only really
known it tough. We came into farming in 1997 after the BSE crisis
when my father became ill, and then we eventually took it over
in 2000. Then we experienced the foot and mouth outbreak and,
as you know, Devon was particularly hard hit. We were about six
miles from a very bad outbreak, but it concentrated the mind.
We moved on again and we embraced CAP reform very positively.
Then we had this year with the RPA payment, or non-payment, eventually
it came through at the end of last month, and that has concentrated
the mind very much. We do not have a God-given right to farm,
but we are working hard to respond to the marketplace by producing
high quality beef, high yielding energy crops and looking after
the countryside. Through the Stewardship Schemes we have seen
species thrive on our farms: skylarks; otters on the river; kingfishers;
hedge sparrow; and we are also in a scheme to enhance the species
of cirl bunting and grey leg partridge. We have cut production
costs to the bone, including labour. This is a good illustration
of how this family farm ran: 25 years ago there were six men employed
by my father; seven years ago, again by my father, four, and now
there is only one man and my husband, and we are perpetually running.
In our drive to be linked to the marketplace we are also in a
supply chain on the beef side with Blade Farming South West. This
is the only integrated supply chain which gives a forward price
and a guaranteed margin. This has been very good for us in terms
of technical and cost-reduction support. We have also done a lot
on the farm as well. We believe in using the farm to connect with
the consumer. We have had about 100 chefs, hoteliers and restaurateurs
out to see how we produce beef, we have had school children, supermarkets,
fresh meat counter staff, and also producers as well. We have
also been on about 35 million labels in Tesco on the standard
beef range. We have been there quite a long time, nine months,
but I think we have come off now, it was with a little bit of
a description about the farm. It is interesting that we have had
letters from the public writing to us about what we are doing
and about the quality of the beef. The misfortune is perhaps to
think that Jilly and Edwin in Devon are producing all the beef
in the country, so perhaps it is slightly misleading. As a result
of that, I was able to go to Brazil and Argentina at the end of
January the beginning of February. As I said earlier, it opened
my eyes to the scale of production, the low cost of production
and the natural resources. Our cost of production is £2.04
per kilo, in Brazil it is 70 pence and in Argentina it is 90 pence.
We simply cannot compete on that same level playing field. To
give an illustration of the scale of one farm in Brazil, one of
eight that was owned by this organisation, they had 35,000 cows
producing 35,000 head of cattle in one year. They could take water
from the river whenever they needed it, they did not have to pay
for it. We are licensed on our river. This is the central issue.
With support gradually being removed, will the marketplace meet
the difference? Will the supermarkets be prepared to pay more?
If I was an idealist I would say, yes, but I am a total realist.
Although the consumer may be willing to pay some more, but at
the moment the supermarkets are reluctant to charge more for quality
beef from this country, so I do not think we are going to bridge
the gap. My small family farm will not stand a chance in an international
global marketplace, and the suckler herds, which are already under
intense pressure through CAP reform, and it is probably the hardest
hit sector, will be under continual pressure. I have to say, sometimes
it is easier to give up than to carry on. What is my message?
I do not think the UK suckler beef industry can survive without
some form of support in the global marketplace, but I think through
the suckler beef herd system there is very good environmental
practice that can bring a perceivable public benefit by the production
of high quality local and regional food, and also in the management
of the landscape which has a huge tourism benefit. We must not
underestimate our own domestic tourism business and our overseas
tourism business, particularly in the South West. Thank you.
Q153 Chairman: Thank you very much.
I note from your written evidence that you said this eye-opening
tour to Argentina and Brazil was, in fact, with Tesco's to see
their supply chain, I hope I have quoted that correctly.
Mrs Greed: Yes, it was.
Q154 Chairman: It opens up one of
the paradoxes which is the first question, what did Tesco's tell
you as to why they needed a supply chain from South America in
the first place? During the course of your discussions with the
Tesco people, did they acknowledge that they had any responsibility
or special relationship with farming in Devon that made them say,
"In spite of the fact that we have seen production at 70
pence a kilo we are still willing to support production at £2.04
a kilo"? When you talked about "we need support",
should that support come through Tesco's till or should it come
from the taxpayer's pocket?
Mrs Greed: To answer the first
point about Tesco, the relationship and what we saw there, we
saw the showcase farms that are supplying Tesco in the UK and
in Europe. In Argentina they are sourcing beef which competes
with the British product prime beef, in the standard range, and
then in Brazil it is much more in the value range. Where they
see the UK British suckler industry is in the finest brands, so
in the premium sector. Like other supermarkets, they are looking
to develop a price position which enables them to have a future
supply trade in the UK so that they have product on their shelves
24 hours of the day, and that is the key thing. They must have
it there 24 hours of the day, day in day out. The second point,
your suggestion that consumers will be willing to pay and will
support the product, I think there is a huge revolution taking
place, and perhaps it is not quite so visible up here but it is
certainly down in the South West. The "buy local", "buy
regional", the identification with local foods, how it is
produced, the environment, is driving a renaissance and a demand
which the supermarkets are now beginning to grasp. They are beginning
to fall over themselves to do buy local and buy regional within
their stores. There still is a price ceiling, and it is a psychological
ceiling, because they had a captive marketplace in the beef industry
for 11 years. The price of beef paid at farm gate level is still
15% below what it was 11 years ago. I think we are the second
lowest still in Europe, which is great for our export trade and
it is opening up opportunities, particularly now with the mature
beef being available in those sectors.
Q155 Chairman: Can I be clear, in
terms of the price you are getting for your beef from the supermarket.
You gave the impression that because of the change in the CAP
and the change of support through the alteration of the suckler
cow arrangements that you have taken a big beating, effectively.
Mrs Greed: Not at the moment,
no.
Q156 Chairman: At the moment is the
price enabling you to make a return on the capital that you have
invested in your beef production unit?
Mrs Greed: The Single Farm Payment
is the only profit area for the farm from our arable and our beef.
Our cost of production is £2.04 and our average price that
we are getting is £2.08/£2.10 per kilo.
Q157 Mrs Moon: I would like to thank
the Chairman for stealing my initial question in relation to Tesco's!
That is the benefit of being the Chairman. My sister and brother-in-law
farm in Devon so I am aware of the problems that you face down
in Devon and I am aware of the opportunities down there as well.
I would also particularly welcome your role in the high level
Stewardship Scheme, I think you should be commended from the description
that you gave of the work that you are doing there, well done.
I see my farmers on a regular basis. We have a cycle of visits
where we have an agreement, we spend 50% of the day on the farm
looking at practical issues on the farm and 50% of the time talking
about the issues. I met with them last Friday, and one of the
things they were raising is something which has come out in a
few of the presentations and it is around food miles. They tell
me that they are appalled at the situation they have where they
have hauliers bringing stock down for slaughter in Wales and then
filling up with Welsh cattle and taking them into the Midlands
for slaughter. How do we get out of this nonsensical cycle of
cattle moving around the country? Everybody has said they want
less regulation, but would it be reasonable and practical to bring
in regulations which brought in those shorter food miles which
said cattle had to be slaughtered within a defined geographical
limit? Is there potential for that? Otherwise, how do we get those
shorter food miles which you have said are important and others
have said are important?
Mrs Greed: I would be very concerned
about putting in any further regulation on slaughtering in terms
of travelling. It is wrong, but what is happening at the moment
is farmers chase the extra pence per kilo. The slaughtering situation
in the UK means that the processing is being concentrated in certain
plants. In the South West, we have two large plants and they are
the largest suppliers to Tesco. You will see that there has also
been a rationalisation within Sainsbury's where Lloyd Maunder
for example, is no longer slaughtering lambs. That created quite
a big lamb problem here in the South West for us as well. There
needs to be much bigger thinking, and better joined-up government
thinking, where we get added-value into our commodity products
through planning and investment from the business sector, which
is the food industry. After all, although my beef may taste really
lovely and it is giving lots of environmental benefit, when it
is on the shelf in Tesco nobody really knows where it comes from,
and certainly I do not know where it has gone. In order to turn
that beef into ready-meals and other quality products, indeed
milk and fish and vegetables and such like, you need much more
infrastructure in the industry. I have been involved in something
called a "South West Food Park"—and I do
not want to talk about that now, but perhaps there might be an
opportunity at another time—where it needed a lot of government
joined-up thinking and planning support from the Regional Development
Agency and Government Office of the South West in order to make
that happen, and now it is not going to happen. It was a £27
million private sector investment in the South West at a strategic
location and it could have made a huge difference in terms of
having centralised processing and distribution. Distribution is
the key. The other key area is branding. We need to have a stronger
image for farming and we also need to be much more promotional
and branded about the food we are producing from this country,
from our regions, and also at a local level as well. There is
a lot which is not right on that front at the moment. Butchers
are seeing a resurgence as well because consumers are now understanding
much more about the meat they are buying, they seek trust and
want to know where it comes from and that there is a fair return
as well.
Q158 Sir Peter Soulsby: I want to
follow up that last point because we heard earlier on from Mr
Smith and, indeed, I think it is implicit in what others have
said about the difficulty and the importance of promoting home
loyalty and local and regional preferences broadly. I think we
are aware that there is a cultural problem in the UK as against
the attitudes in France or Germany and, indeed, apparently also
in Devon, because clearly there are successes at a local level
there. I wonder if you can say a little bit more about what you
think can be done to help extend what you have described as a
revolution in Devon on a more UK-wide change in attitude, and
what other agencies might do to assist in that process?
Mrs Greed: There are various sectors
which need improvement. I think the supermarkets' labelling, certainly
on the fresh beef side, is very tight, but if you take the food
service sector, particularly the hospitality sector, the tourism
area, you will find that 70% of the beef served in these outlets
is from overseas and it is travelling many more miles. There is
very little accountability. There is no audited system which gives
the consumer more information, unless the restaurateur or the
hotelier or the publican want to promote the source of their meat.
When they do promote local or regional products they invariably
find that they are on a completely winning formula. Perhaps that
is one area where promotion and auditing could be improved. Coming
back to the point about state aids, I have been involved with
EBLEX and they were very good in supporting the event for the
hospitality trade on the farm. But we ran into all sorts of state
aid rules, because it was West Country beef, and it was exasperating.
I think the fact that our levy is taken in order to give some
marketing benefit and yet it cannot be used directly back to that
particular region is frustrating.
Q159 Chairman: Thank you very much
indeed. Because of the quality and interest of the information
we have had we are sadly running a little bit behind time, so
I hope our next two witnesses will be willing to co-operate a
little bit. Roger, if you would be kind enough to make your presentation
to the Committee and then, John, if you would follow straightaway
afterwards, and then colleagues will put questions individually
to you.
Mr James: My name is Roger James.
I am 46 years old. I have been farming in my own right and have
been my own boss in farming for 20 years. The farming industry
in this country, especially the hill areas, is completely reliant
on subsidies. With no subsidies there will be no farmers, or very
few farmers, left in the hill areas. Whether you like that statement
or not, I do not care, but that is the truth of the matter. The
youngsters are going out of farming in mid-Wales at an alarming
rate. They are getting educated. They want to work for five days
a week, not seven days a week, and if we are not careful we will
not have another generation of farmers in our area. I have got
a young son and his attitude is, "Dad, I am going to get
a proper job", and I think to myself regularly, "He
is right, I am wrong". They all want more spare time. When
I read the reform, the crux of the matter was money, and everything
boils down to money. They want to get rid of all subsidies, so
how do you go about getting rid of subsidies? Do you leave all
of your farmers in the UK flat and dry or do you keep pumping
the money in? I will agree that the money is pumped in in a very
irresponsible way. You tend to talk to people and you get a compromise,
and by getting the compromises when you are talking to people
you are missing the point and you are not directing the money
in the right direction. 80% of the money goes to 20% of the farmers.
I feel there should possibly be a maximum payout per working farmer,
whether you cut that to 300 acres, 500 acres, or what, I do not
know, but that is how I feel the money should be directed. We
should put a lot more people back on the land. There are a lot
of people unemployed in this country, so I feel it would put more
people back into the rural economy. I feel the rural economy is
very important. We live in a very small rural area, everybody
helps everybody else, and it would be a pity to lose that. A lot
of the houses on the farms in Wales are getting sold off. The
English are coming from the South and buying them up, and the
young people in our area cannot compete, so that is another thing,
we need the money to compete with those. People should not claim
a pension and subsidies. I think my head might roll for that statement,
but people are getting two subsidies. If you are 65, you are getting
the subsidy for farming and you are also getting the pension.
You are not leaving room for our youngsters to get into farming.
We are supposed to be able to compete in a global economy, does
Tony Blair compete when he goes for his wages in the economy?
I feel he does not. It should be like-for-like. We cannot compete
because very few others compete. A level playing field, we have
got no chance of a level playing field. Our live export is very
few and our lamb would be worth at least 50% more if we could
get it into Europe at the right money. That would be the difference
between survival and sinking for people like me. In your notes
on the Vision reform, it says New Zealand's subsidies finished
in the 1980s, well do not compare the UK with New Zealand because
we cannot. They have got a climate where they feed animals in
the summer and we have got a climate where we feed animals for
seven months in the winter, so do not think we can compete with
New Zealand because we cannot. Reading on in the report, it is
costing a family of four €950 in subsidies to keep farmers
throughout Europe. The way I read it, it is €950 as an insurance
policy to put food on the table. It has not been many years since
this country was short of food. Do you want to go back to that?
It is all about money and food. I have got a full belly, I am
not complaining, and the majority of people in this country have
full got bellies. Do not complain on a full stomach, it is only
money.
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