Environment, Food and Rural Affairs CommitteeWritten evidence submitted by Wildlife & Countryside Link

1. Introduction

1.1 Wildlife and Countryside Link (Link) brings together 42 voluntary organisations concerned with the conservation and protection of wildlife and the countryside. Our members practise and advocate environmentally sensitive land management, and encourage respect for and enjoyment of natural landscapes and features, the historic and marine environment and biodiversity. Taken together our members have the support of over 8 million people in the UK and manage over 750,000 hectares of land.

1.2 Link welcomes the opportunity to respond to the Environment, Food and Rural Affairs (EFRA) Select Committee’s enquiry into CAP implementation 2014–20.

1.3 This response is supported by the following 14 organisations:

Amphibian and Reptile Conservation.

British Mountaineering Council.

Buglife—The Invertebrate Conservation Trust.

Butterfly Conservation.

Campaign to Protect Rural England.

The Mammal Society.

National Trust.

Open Spaces Society.

Plantlife.

Ramblers.

Royal Society for the Prevention of Cruelty to Animals.

Wildfowl & Wetlands Trust.

The Wildlife Trusts.

Woodland Trust.

Fairness

2. Whether the UK’s implementation of CAP might put English farmers at a competitive disadvantage to their regional and European counterparts

2.1 Each of the four UK countries is yet to determine their CAP implementation decisions and so it is impossible to determine their impact on farm competitiveness at this point.

2.2 However, Link believes that there are three crucial decisions to be taken in each country context, which if made well, would boost both farming’s environmental performance, something which is much needed given the findings of the recent “State of Nature” report,1 whilst also supporting improved farm competitiveness. In an English context, Link calls upon Defra to:

Modulate 15% from Pillar I into Pillar II;

Prioritise agri-environment schemes in the next Rural Development Programme for England (RDPE); and

Take an ambitious approach to Pillar I greening requirements, via a National Certification Scheme (NCS).

2.3 Link fully supports maximum transfers from Pillar I into Pillar II. 15% modulation would rebalance England’s anticipated, and deeply inadequate, Pillar II allocation and ensure existing agri-environment commitments are honoured and new agreements can be offered during the 2014–20 period. This is critical to ensure England’s most progressive farmers can continue to be supported through schemes which deliver clear environmental benefits and deliver against key Defra policy objectives such as those relating to NATURA 2000 and the Water Framework Directive.

2.4 The transfer of funding from Pillar I into Pillar II is a well-established mechanism in the UK, in use since 2001. It has been critically important in partially compensating for the UK’s disproportionately low Pillar II allocation and the funds generated have been used to invest in more ambitious and effective rural development programmes. We believe that English farmers would be at a disadvantage if they were deprived of the chance to benefit from knowledge transfer measures, sharing of best practice, access vocational training to increase skills levels, and to develop new market opportunities through on farm diversification.

2.5 The 2007–13 Rural Development Programme for England (RDPE) prioritised spending on Environmental Stewardship schemes and given the scale of environmental need there is clear justification for continuing to do so for the successor scheme, referred to as NELMS.

2.6 Well-designed, targeted and funded agri-environment schemes are proven to deliver tangible environmental benefits. The successful implementation of the government’s Biodiversity 2020 strategy will be at risk if NELMS is inadequately resourced.

2.7 Agri-environment schemes also have wider socio-economic benefits. A report by the Countryside and Community Research Institute has highlighted that every £1 of Environmental Stewardship money generates a total output in the local economy of £1.42.2

2.8 In contrast, Pillar I funds work against farm competitiveness by acting as an artificial buffer to market forces. They also contribute to inflated land and rental values, creating a hurdle to new entrants to farming. Even though “reverse modulation” is now permitted, Link firmly believes its use in any country context would further exacerbate the negative impacts of untargeted Pillar I payments whilst at the same time further stripping away the ability of Pillar II to address the real and pressing market failure to reward the delivery of environmental public goods. As such, reverse modulation should not be used in England, or in other UK countries.

2.9 NELMS should continue to prioritise the delivery of positive land management activities that maintain and enhance biodiversity, landscape character, and encourage public access to the countryside. This will not only help to address the market failure to reward the delivery of such environmental public goods but will also make a vital contribution to the economic vitality of farming and rural areas, for example through tourism.

2.10 Link welcomes Defra’s intention to make NELMS more targeted, focused and ambitious relative to Environmental Stewardship and this is fully in keeping with the leadership role England has played in the development of agri-environment schemes over the last 25 years. There are several key lessons to be learned from Environmental Stewardship, particularly the need to ensure each agreement contains the right package of land management options to deliver the intended environmental outcomes.

2.11 Given that the Defra will be subject to budgetary cuts of 30%, it is vital that these do not hinder the ability of Natural England to provide expert advice to farmers and land managers through the lifetime of scheme agreements. This advice should not be viewed as a negative and burdensome “cost” but rather a key component of maximising the positive environmental outcomes NELMS can deliver.

2.12 Well-designed “greening” measures could also contribute to improved competitiveness by encouraging farmers to diversify their cropping choices and thus spreading risk. There are also several land management options, currently deployed under Environmental Stewardship but which could be delivered under Pillar I greening, which benefit agricultural production by supporting pollinating insects, regulating pests and supporting soil formation. In turn therefore, greening requirements should be implemented in ways which support agricultural production and long term competitiveness but in order to be most effective, an ambitious approach is necessary. Link therefore supports the use of a National Certification Scheme (see section 5).

3. What steps the Government might take in implementing CAP to help tenant farmers in upland areas, and to take account of issues pertaining to common land

3.1 In the UK, High Nature Value (HNV) farming—that which makes a particularly high contribution to the provision of environmental public goods—is mainly associated with low-intensity livestock systems, largely found in the uplands. Despite the environmental benefits many such systems deliver, maintaining, or indeed even reaching, economic profitability remains a challenge.

3.2 It is also important that the Government implements part one of the Commons Act 2006 throughout England, to ensure up to date and accurate registers of common land to provide accurate base for mapping for CAP.

3.3 We are open to changes in CAP payment approaches which would uplift financial support to upland farmers as long as these payments were linked to environmental public goods delivery and not simply a blanket payment which could perversely lead to negative environmental impacts eg intensification of in-bye land and under grazing of hill areas. In addition, NELMS design must ensure that appropriate uplands management options and payment rates are available to encourage the uptake of additional positive management over and above that required by Pillar I requirements.

3.4 The scope for attaching environmental conditionality to Pillar I payments remains limited and the tools that are available are fairly blunt. However there is potential to secure some environmental conditionality from Pillar I via a National Certification Scheme (NCS) approach to greening. This would increase the scope to include land management measures that protect and enhance upland landscapes.

Bureaucracy

4. What steps does the Government need to take to ensure the reformed CAP will be less bureaucratic than its predecessor and what might prevent this ambition from being achieved

4.1 The challenge for the UK’s implementing authorities will be to implement the new CAP framework so that it adequately supports and drives farmers and land mangers to address long standing environmental problems. For complex environmental challenges complex responses are often required however this does not mean that the interface with farmers and land managers has to be complicated. Indeed we would support as user-friendly a system as possible but it is vital to recognise that in order to secure effectiveness in outcomes, intelligently designed and evidence based systems of delivery will be required.

4.2 Less bureaucracy and improved environmental delivery could be secured through two approaches: opting for a simple interpretation of the active farmer test (see 4.2) and a National Certification Scheme (NCS) which covers all farming systems (see section 5).

5. How might the Government define the minimum activity required for qualification as an “active farmer”?

5.1 Many farming systems which are particularly beneficial for biodiversity and the provision of other environmental public goods are characterised by very low stocking rates. Defra’s approach to implementing the active farmer test must ensure that the criteria for minimum activity are not set at a level which would exclude very extensive livestock producers—many of which would be found in the English uplands.

Greening

6. How should the Government ensure that CAP delivers the best environmental benefits while supporting food production?

6.1 Research has identified that CAP payments are not necessary to underpin food production.3 Indeed, in their absence, the likely reduction in food production would be less than 0.25%. Where the CAP does have a clear role is to support farmers to produce food and other commodities in a sustainable way, and to adequately reward the provision of environmental public goods where the market fails to do so. This is particularly important for those farming systems which are economically marginalised but deliver outstanding levels of public goods through their land management practices. We had hoped that the most recent round of reform would better link environmental public good delivery with CAP payments (the “public money for public goods” principle) however this has failed to materialise and as such, many marginal farms remain dependant on Pillar I payments and the delivery of their environmental public goods remains largely unrewarded.

6.2 Rather than Pillar I greening, we would have preferred a progressive transfer of funds into Pillar II. However, we acknowledge that greening can and must play an important role in increasing the value for money from the public spending in Pillar I. The greening payment will constitute one third of the Pillar I budget—£5.3 billion across the UK for the period up to 2020, or approximately £495 million in England each year alone.4 This amount of money could deliver substantial environmental benefits if it is tied to meaningful environmental measures, but if not, it will achieve little more than greenwash. The details of greening implementation will vary across England, Wales, Northern Ireland and Scotland, but there are certain principles that must be adhered to. Link will only support an approach to greening that rewards the provision of non-marketable environmental public goods and requires all farmers to play their part: there must be no exemptions from greening that are not justified on the basis of sound environmental evidence.

6.3 We believe that the best way to implement greening in England is via a National Certification Scheme, designed to implement measures that help England’s varied farming systems address their particular environmental challenges. Existing certification schemes and assurance standards should not be considered as providing equivalence due to the compliance issues (many are focused on production methods rather than environmental outcomes) with associated disallowance risks.

6.4 We reject the inference that Pillar I greening that is tied to meaningful environmental requirements equates to “gold plating”. The greening payment is exactly that, a payment, and not a regulatory requirement and in this instance, Defra’s obligation is not to farmers, but to taxpayers by ensuring value for money through clear environmental effectiveness.

6.5 The greening payment should be viewed in the same way as Pillar II agri-environment schemes are: as the means to use public money to reward environmental public goods delivery. Whilst the nature of Pillar I payments means they are more restricted than Pillar II (for example they are annual and non-contractual) they can be used to reward positive land management which in turn supports food security by protecting and enhancing the natural resource base.

Lessons Learnt

7. What are the principal lessons the Government should learn from the implementation of the previous CAP?

7.1 The willingness of farmers to enter the Higher Level Stewardship scheme demonstrates a welcome desire to undertake sophisticated environmental management delivering environmental objectives. Should this work be undone by cuts to Pillar II, valuable investment will be lost. Therefore, continued use of maximum modulation should be a clear take-home message for the government. In contrast, the Entry Level Scheme has delivered poor value for money. Offering a broad and shallow scheme without adequate checks on agreement quality has allowed numerous weak and unfocused agreements. It is imperative that every new scheme agreement offered provides high quality environmental outcomes.

7.2 During the Health Check of the CAP in 2008, the then UK government expended significant political capital to secure the ability to implement a set-aside mitigation measure in cross-compliance. However, when it came to implementation, the Secretary of State chose to pursue a voluntary approach instead via the Campaign for the Farmed Environment (CFE). Whilst the CFE has certainly raised awareness among farmers about the best way to optimise environmental benefit from land management options, it did not succeed against its original objectives. We therefore urge the current government to learn from this experience of using voluntary approaches for environmental delivery. Defra fought hard for the ability to apply higher rates of modulation into Pillar II, and also to use a National Certification Scheme to implement Pillar I greening. The evidence base which led Defra to prioritise these objectives during negotiations has not changed therefore making full use of both is the only logical course of action.

October 2013