The
Committee consisted of the following
Members:
Chairman:
Mr.
Christopher Chope
Ainger,
Nick
(Carmarthen, West and South Pembrokeshire)
(Lab)
Armstrong,
Hilary
(North-West Durham)
(Lab)
Burt,
Alistair
(North-East Bedfordshire)
(Con)
Clappison,
Mr. James
(Hertsmere)
(Con)
Clark,
Ms Katy
(North Ayrshire and Arran)
(Lab)
Farron,
Tim
(Westmorland and Lonsdale)
(LD)
Goodman,
Helen
(Bishop Auckland)
(Lab)
Jack,
Mr. Michael
(Fylde)
(Con)
Kennedy,
Jane
(Minister of State, Department for Environment, Food and Rural
Affairs)
Kumar,
Dr. Ashok
(Middlesbrough, South and East Cleveland)
(Lab)
Paice,
Mr. James
(South-East Cambridgeshire)
(Con)
Plaskitt,
Mr. James
(Warwick and Leamington)
(Lab)
Williams,
Mr. Roger
(Brecon and Radnorshire)
(LD)
Hannah Weston, Committee
Clerk
attended the
Committee
The following also
attended, pursuant to Standing Order No.
119:
Drew,
Mr. David
(Stroud)
(Lab/Co-op)
Hopkins,
Kelvin
(Luton, North) (Lab)
European
Committee A
Monday 20
October
2008
[Mr.
Christopher Chope in the
Chair]
CAP Health Check and Rising Food Prices
4.30
pm
The
Chairman: I understand that Katy Clark, as a member of the
European Scrutiny Committee, wishes to take advantage of the
opportunity to explain why this matter has been
referred.
Ms
Katy Clark (North Ayrshire and Arran) (Lab): I have been
asked to take a couple of minutes to explain the background to the
documents and why the European Scrutiny Committee has recommended them
for debate in Committee.
Since 1992,
there have been a number of reforms of the common agricultural policy
aimed at replacing market-related support, such as intervention by
direct income payments to producers and streamlining support
arrangements. However, the Commission says that if the reform process
is to continue, it is necessary to identify further improvements that
should be made. Therefore, in November 2007, it produced a health check
of the CAP, which set out a number of further measures relating to both
the market and environmental concerns. That document was debated in a
European Committee on 25
February.
Document
No. 9656/08 comprises a number of proposals aimed at giving legislative
effect to the health check and, inevitably, it covers similar ground.
Despite that and the relatively short time since the last debate, the
European Scrutiny Committee considered that the document should be
debated because of the inherent importance of the subject, and because
of the extent to which the proposals reflect developments in the
Commissions thinking since last November. However, we were also
influenced by two further considerations: first, the environmental
consequences of the proposals; and, secondly, the need to take into
account recent increases in world food prices. The latter point is
addressed in document No. 9923/08, which is the second of the documents
before
us.
That
document seeks to analyse the reasons for the increase, to assess the
impact in the Community and more widely, and to outline a Community
response. It notes that although the impact within the Community has
been mitigated by several factors, the global effects could be severe,
particularly for developing countries that are net importers of food.
The document concludes by outlining a number of measures that the
Community could take in the short, medium and long terms, as well as
action that could be taken internationally. In view of the importance
and topicality of that subject, and its relationship to the CAP health
check, the European Scrutiny Committee recommended that the document
should be debated in European Committee alongside document No.
9656/08.
The
Chairman: I call the Minister to make her opening
statement.
4.33
pm
The
Minister of State, Department for Environment, Food and Rural Affairs
(Jane Kennedy): It is pleasure to serve under your
chairmanship, Mr. Chope, to discuss what isI
entirely agreean important set of papers that are worthy of
scrutiny. I will get in my excuses in advance: when I was preparing for
the debate, an official told me that this was like sitting an A-level
with only two weeks study time. I will genuinely do my best to
answer the detailed questions that will be asked. I am aware of the
interest that the subject generates among hon. Members in the room,
including you, Mr. Chope. Many members of the Committee know
a great deal about the detail of the subject and have a vast experience
of it, but I will do my best to give the answers that they seek. The
comments that are made and the concerns that are expressed in such
Committees often inform and assist the Government when we debate these
issues in Europe. I therefore want to listen carefully to what is said
and to do my best to answer
questions.
We
are dealing with two issues today. We are debating the
Commissions proposals for the CAP health check reforms and the
issue of rising food prices. Our goals for the health check and for the
longer-term reform of the CAP are driven by our vision for farming. We
want a profitable and internationally competitive farming sector that
earns its rewards from the market for high-quality food that is
produced to high standards and is affordable for consumers.
Environmental responsibilities must be integral to farmings
long-term success. Farming should be rewarded for providing
environmental services, such as landscape management, protection of
biodiversity and action to tackle climate
change.
Reforming
the CAP is a vital part of achieving our vision. At a time of high
global food prices, when millions of people around the world are being
pushed deeper into poverty and hunger and UK families are spending more
of their weekly budgets on food, the CAP still includes mechanisms that
withdraw food from the market and undermine production in developing
countries. It still weighs farmers down with regulation and inhibits
competitiveness.
Our
long-term ambition is to achieve the elimination of the expensive,
wasteful and distorting pillar one of the CAP. I hope that hon. Members
on both sides of the Committee share that aim. Public money should be
targeted at producing environmental benefits for society, and the
health check is an important step towards that
goal.
One
of our highest priorities in the current EU discussions on the health
check is to reduce the market distortions faced by our farmers. We are
thus negotiating to secure the removal of all subsidies in the EU that
remain linked to production and to prevent new distortions from
creeping in. We are arguing, for example, for the ending of milk quotas
and set-aside, to allow farmers to take their own business decisions
about production levels and to cut food costs. Other aspects of the old
price support system must be cut back and eventually phased
out.
I
strongly support the Commissions proposal in the health check
to increase the focus of funding on environmental challenges and the
contribution that farming
can make to our biodiversity and climate change objectives.
Simplification and reduced administrative burdens for farmers are key
priorities of mine, and we are working to keep those high on the health
check
agenda.
It
would be remiss of me to go any further without paying tribute to my
predecessor, Lord Rooker, for the very good work that he did as the
Minister responsible for farming. I know from the farmers whom I have
already met how very much appreciated he was because of the interest
that he took in farming and his willingness to listen to the concerns
of farmers and to work hard to ensure that those concerns were
responded
to.
I
come now to the Commission communication entitled Tackling the
challenge of rising food pricesDirections for EU
action. At a time of global economic instability, changes in
food and fuel prices make peoples lives more difficult. At
home, poorer families spend more of their weekly budget on food as
prices rise. For example, the price of bread and butter is up by about
70p on what it was 12 months ago, while eggs and cheese cost about
25 per cent. more, although food prices are quite
volatile.
We
need to think about where and how we produce our food for the future.
Our food supply will need to be reliable, resilient and able to
withstand shocks and crises, so our food security policy will need to
cover the availability, access and affordability of food. Our food
supply in the UK is secure. We have the capacity to produce food in
significant quantities and we have trading partners throughout Europe
and beyond. Our food security cannot be considered in isolation from
that of the rest of the world. If protectionism is the answer, someone
is asking the wrong question. We need a trading system that is strong,
open, global and sustainable. That depends on getting right the level
of intervention from the Government and the
EU.
We
support the proposed EU response to the rise in food prices set out in
the communication, which is in line with what we argued for at the G8
meeting in Japan in July. Only with concerted action such as this can
we tackle the problem of rising food prices around the
world.
I
look forward to discussing these important issues further, not least
with the hon. Member for South-East Cambridgeshire, for whom I have the
highest regard. Indeed, his knowledge on the subject gives me some
cause for concern.
The
Chairman: The Committee has until 5.30 pm for questions to
the Minister. I encourage hon. Members to be brief, and I hope that the
Ministers responses will be succinct. I am prepared to allow a
series of questions so that Members are able to engage in a sustained
line of questioning, but only if that is not
abused.
Mr.
James Paice (South-East Cambridgeshire) (Con): I, too,
welcome the opportunity to serve under your chairmanship,
Mr.
Chope.
We
are debating a subject that, as the Minister suggested, I consider to
be of some importance. I welcome the right hon. Lady to her new post.
She comes to the Department with a considerable reputation as someone
who listens and who is interested in the subject. I look forward to
working with her.
I entirely
support the Ministers comments on her predecessor. I sparred
with Jeff Rooker when he was a Member of our House; and, perhaps more
than is
usual, I have worked alongside him in the years since he has been in the
other place. I share her belief that he understood the problems and
difficulties of farmers, and that he supported them. I would go
slightly further by pointing out that he had eventually had enough of
the frustrations caused by the impossibility of persuading the rest of
the Government to adopt his views. I shall not go through everything
that happened during the past 12 months that finally led him to decide
that enough was enough. I wish the Minister well. I hope that she will
come to the same conclusions as Lord Rooker and that she will be more
successful in getting her
way.
You
will understand, Mr. Chope, that I have many questions, and
I am reliant entirely on you as to how I ask them. My first question is
about what the Minister referred to in her opening remarks as the
Governments vision for farming. Nearly three
years ago, in December 2005, the Government published a document
entitled, A Vision for the Common Agricultural Policy.
Is that still a full description of the Governments attitude to
farming and the common agricultural
policy?
Jane
Kennedy: The overall scope of the health check was set out
at the time of that vision statement. I believe that the work that has
been invested in the health check very much mirrors the vision that the
Government set out in 2005. Anyone who has served in government knows
that new Ministers step into policy areas that have been well worked;
that is particularly so for me in following my noble Friend Lord
Rooker. However, I want to bring a fresh pair of eyes to the vision
statement to ensure that it remains appropriate for todays
circumstances, especially given the tremendous changes that are taking
place in the world.
Kelvin
Hopkins (Luton, North) (Lab): Does my right hon. Friend
accept that the CAP still tends to favour large agribusiness and very
rich farmers rather than small, less affluent farmers? Are the
Government aware of that, and will they try to do something about
it?
Jane
Kennedy: I am aware from the farmers whom I have met so
far that some sectors of farming are supported by the common
agricultural policy and others are not supported through payments from
the European Union. As a result, there are differences even within the
United Kingdoms agricultural industry. My hon. Friend is right.
I want to study the various impacts of the CAP on farmers. I do not yet
know in sufficient detail how those impacts take effect, but we are
looking to bring about a level playing field not only for farmers in
the UK, but for British farmers within
Europe.
Tim
Farron (Westmorland and Lonsdale) (LD): It is a pleasure,
Mr. Chope, to serve under your chairmanship. I welcome the
Minister to her new post.
I echo the
earlier comments about how easy Lord Rooker was to work with and how
much farmers valued his listening ear. He intervened on many occasions
anddare I say with offence to non-Members who are
presentshowed a willingness to overrule his civil servants,
which is something that all Ministers should consider doing, at least
occasionally.
When the
Minister considers the health check with regard to delivering
environmental goods and keeping food prices low, will she recognise
that having farmers present in our countrysideparticularly in
the uplandsis a significant factor in helping us to deliver
biodiversity schemes? It also ensures that we have sufficient capacity
for food supply to keep prices low. If the movement within CAP reform
leads to less money going to the less well-off dairy farmers and
farmers in the uplands, we may see many people leaving the industry,
which means that the schemes that Natural England wants to see in the
uplands will not be delivered, because no one will be there to deliver
them. We will also see an upward pressure on food prices, because we
will not have sufficient capacity to produce food. For example, we
could produce less milk than at any other time in recorded
history.