International Development Committee - Minutes of Evidence176

Back to Report

Oral Evidence

Taken before the International Development Committee

on Thursday 18 April 2013

Members present:

Sir Malcolm Bruce (Chair)

Hugh Bayley

Fiona Bruce

Richard Burden

Fabian Hamilton

Pauline Latham

Mr Michael McCann

Fiona O’Donnell

Chris White

________________

Examination of Witness

Witness: Norman Baker MP, Parliamentary UnderSecretary of State, Department for Transport, gave evidence.

Q125 Chair: Good morning, Minister, and thank you very much for coming in. This is not your usual Committee, but you are nonetheless welcome. As you will probably appreciate, we have just a few questions that we want to explore with you on the issue of biofuels and the competition with food. What we have heard in the evidence so far is a pretty overwhelming view that the existing food mandate should be scrapped. The people who have given evidence to us say it is distorting, dysfunctional and it should be scrapped. That seems to be all the evidence. Everybody we have had has said it should be scrapped, so why is it not being scrapped, or at least radically changed?

Norman Baker: Thank you first of all for inviting me along. I am very happy to contribute from the Department for Transport. As you will appreciate, these matters are decided at European Union level by the relevant directives, predominantly the renewable energy directive, but also the fuel quality directive has an impact on this area as well. That directive was set some time ago, about 10 years ago, and when it was set, the world seemed to think that biofuels were completely beneficial with no downside, and certainly the pressure groups at the time were pushing politicians of all parties to embrace biofuels. Then there was a volteface by them almost overnight, to say, "No, there are some downsides to these things, we should not be having them", as we are.

We have targets that were set on the basis that the higher the target, the better the environmental outcome. That clearly is not the case, and evidence subsequently has shown that there are downsides to biofuels that need to be factored in. I personally think the Department would not have started from where we are. Biofuels have a role to play. Some biofuels can be entirely beneficial, for example the biodiesel derived from waste cooking oil. We have been incentivising those sorts of biofuels through the renewable transport fuel obligation, and in fact the amount of wastederived biofuel has now gone up, in biodiesel terms, from 15% to 84% in about five years, so we have been successful in our domestic promotion of that.

However, there are biofuels that clearly are a disadvantage in terms of both the areas your Committee is concerned about, but also in environment terms. Our estimate is that once you take into account indirect land use change, which we think is a serious issue, then some biofuels are worse in greenhouse gas emission terms than fossil fuels are. We would prefer, if we were to start from a blank piece of paper, to have sustainability criteria applied to biofuels, and only use biofuels that met those criteria, rather than having to pursue an abstract target set by the EU. The target is there, however what we have done domestically is not to increase the target for the renewable transport fuel obligation. That remains where it is and has not been increased, and I would like to make progress in the European Union to recast the way in which they prioritise and incentivise biofuels. However, I have to say that there is not necessarily a great deal of enthusiasm for that from other countries.

Q126 Fabian Hamilton: This year the UK biofuel mandate reached its highest level ever, I understand. What are the Government’s plans for how this target will evolve in the future, and does the Government have any plans to build in safeguards to limit the negative impacts on food security?

Norman Baker: The target is a 2020 target, and it does not increase each year. It is simply the 2020 target we are obliged to meet. There is an expectation from the European Union that we will be on a trajectory upwards towards our target, but there is no absolute requirement to be that. In fact, the renewable transport fuel obligation target is 4.75%. That was a decrease from 5% on the basis that we took in nonroad mobile machinery for the first time, and therefore it still equates to around 5%. In fact our target has not increased, and will not be increasing, at least until 2014. The overall target remains where it is and we want to make progress to try to get the European Union to rethink how they consider these matters, and therefore we are holding our target where it is until such time as we have had an opportunity to see how ILUC in particular falls out of the European Union.

Q127 Fabian Hamilton: What about the safeguards to limit negative impacts on food security, then?

Norman Baker: Sadly, that has not been a factor that was taken into account in the consideration. As I say, the targets were set at a time when biofuels were regarded as wholly beneficial. Let me just be clear: for the biofuels industry there are upsides to biofuels, and we need to not lose sight of that in our proper consideration of the downsides, but the reality is that it was assumed on day one that they were beneficial in tackling carbon reduction. That is not necessarily the case.

There was not consideration given, in my judgment, in 2002 and 2003 when the proposals were formed, as to the impact on developing countries, or on land use, or on anything really beyond greenhouse gas emissions, insofar as they were considered. It has not been factored in. My view is that if we are successful in arguing for ILUC factors to be applied-and that is something that the Government is arguing for in the European Union, and that matter is live now-then although ILUC factors in themselves do not take into account the impact on food and developing countries directly, nevertheless the limitations that that have been placed on the production of biofuels from those sorts of areas, because of greenhouse gas restrictions, would also have an impact on reducing the amount of land taken away from food production.

Q128 Fabian Hamilton: You mentioned in your earlier reply the recycling of waste cooking oil. For example, I opened a power station last year in my constituency that did exactly that. We know that biofuels drawn from nonfood crops are markedly less problematic for food security, but what do you think we can do, apart from waste cooking oil and so on, to support the development of nonfoodbased fuels?

Norman Baker: We incentivise those under the renewable transport fuels obligation, we double–count those against the obligation, which is one of the reasons why the percentage of wastederived biofuel has gone up from 15% to 84% in four or five years in this country. We are also very keen to work with industry to develop newgeneration biofuels, perhaps based on algae, for example, although that has water or land implications as well, which are nevertheless likely to be less. We are encouraging industry to go down that road. The ILUC proposal in the European Union at the moment envisages that there could be quadruple counting for some beneficial, noncontroversial biofuels such as those, and that is something we are supporting. We are hopeful on that point we might make progress with our European partners.

Q129 Fiona O'Donnell: Just to be clear, then, the UK Government supports the European Commission proposal for a 5% cap on biofuels?

Norman Baker: No, we prefer something that is better and greener, and probably more to the liking of your Committee is the introduction of ILUC factors, which take into account indirect land use change and its consequences, particularly in relation to greenhouse gas emissions, but also indirectly the use of land for food production. We think that is a better way, to base our policy on sustainability criteria rather than on abstract targets. However, we will obviously have to wait and see what other European countries are doing, and certainly if we ended up with a cap, we would want a lower cap rather than a higher cap.

Q130 Fiona O'Donnell: It is not just NGOs that have expressed concerns about the subsidies, but also business. The B20 has called for an end to subsidies. Would you support that?

Norman Baker: Of course, everybody is governed by World Trade Organisation rules, which are doubtless something that your Committee has looked at in the past, or will do in the future as well. Therefore, that is the mechanism as I understand it for controlling any suggestion of unfair trade arrangements.

Q131 Fiona O'Donnell: How does the situation in the US compare to the situation in the EU? What is your understanding of that?

Norman Baker: Are we talking about the mandates?

Fiona O'Donnell: Subsidies and mandates, yes.

Norman Baker: In terms of the mandates, they have a renewable fuel standard that contains four categories. The 2013 requirements relate to renewable fuel with a 20% lifecycle greenhouse gas reduction requirement. They have a different category for advanced biofuel with a 50% lifecycle greenhouse gas reduction. I should just say, by the way, in parenthesis that their definition of advanced biofuels is not the same as ours. Our definition of advanced biofuels is newgeneration biofuels, whereas the American definition of advanced takes into account just biofuels that exist, for example, from Brazil, which happen to have a big greenhouse gas saving.

The third category is biomassbased diesel, where they also wanted a 50% lifecycle greenhouse gas reduction, and cellulosic biofuel, with a 60% lifecycle reduction. They have quite a structured arrangement in the US to try to drive down greenhouse gases, but as I say, similar to the European Union, their focus has been on the direct carbon consequences, if you like, the greenhouse gas or climate change consequences of biofuels, rather than looking at what I think is of interest to your Committee.

Q132 Fiona O'Donnell: I was going to compliment the Minister: he has been incredibly concise in his answers to questions, which will allow me then, maybe, to quickly return to the European Commission. What the UK Government is seeking is something that is more effective and more wideranging than the 5% cut. In that case, why does it appear the UK Government has been silent in the Commission on this issue?

Norman Baker: The European Parliament?

Fiona O'Donnell: The European Commission, sorry.

Norman Baker: Let me say that the European Commission is more than a oneheaded body, and it does not help the fact that we have two different Commissioners, in my view, who are interested in these matters. You have Connie Hedegaard on the environmental side, and you have Mr Oettinger on the energy side, and you have two separate directives, the renewable energy directive and the fuel quality directive, which interact with each other but do not quite overlap. They are more like concentric circles, and they have slightly different drivers. Frankly, the legislative arrangements are not the most beneficial that could be created if you were starting with a blank piece of paper.

There is therefore a tension in the European Union between, first of all, those countries that are predominantly interested, perhaps, in environmental outcomes, which includes the UK, and those which have perhaps big biodiesel industries, who do not want to see restrictions on those industries through the introduction of environmental limits.

Q133 Fiona O'Donnell: In that case, would it not just be easier to go for the cap? I know you say it is a rather crude measure, but would that not be a simpler response?

Norman Baker: No, it is a less satisfactory response, because where we have to go in the future, in my view, to help not just the environment, but also the biofuels industry, is to give some certainty. The way we get certainty is to build in sustainability criteria. If we do that, then everybody knows where they are, and the industry can then grow as we want it to grow, but on a firm foundation. The danger with having targets is that you are actually building on sand, and that does not help anybody.

Q134 Chair: Just to pursue that, you did not mention Mr Piebalgs, the Development Commissioner, and you implied that there were strong vested interests not to change it. Who are our potential allies? I do not question your personal credentials whatsoever; you and I have worked together, and I know what they are. In a sense, however, how big an issue is it for Britain to say, "We want to give some leadership on this: we have a very strong commitment to development, the strongest in the EU-certainly amongst the major countries-and that should have been considered and it should now be considered"? The implication of your answers so far is that you do not think you will get much traction.

Norman Baker: I need to be realistic about this. We have obviously worked with other countries to see where they are, and we have an uphill struggle-I am perfectly open about that-in order to achieve what I think is the best result for the environment, for developing countries and indeed for the biofuels industry in the longer term. However, it is an uphill struggle. We are obviously trying to maximise our support. I think our position is understood and respected in the European Union. Under the Irish Presidency, they were certainly very keen to use our expertise and knowledge to take forward what they might be putting forward as proposals, and we are obviously in constant discussions both with other countries and with the European Parliament, which looks like it may have a position closer to the British Government’s position than the Commission hitherto has had.

Q135 Fiona O'Donnell: Can I very quickly, Chair, just ask: will biofuels be on the agenda for the G8 summit?

Norman Baker: I don’t know the answer to that, because I am afraid it is a bit above my pay grade.

Fiona O'Donnell: Very modest.

Q136 Chair: From the Committee’s point of view, that has covered the ground that we want. We appreciate that you understand what the Committee’s objectives are, and I think you are right to point out-and again, I was involved, as you were, at the time-that the original objectives just did not consider the negative impact. I think we wish to give you strong support in your engagement that it really is not good enough to have yet another situation where the European Union is setting policy for itself that has negative implications for its development agenda, which it does not consider. It seems to me that this Committee will want to back you up-prejudging our Report-on that. I hope that will enable you to leave this room with an even firmer step to fight that corner. It is not good enough. We have the same issue on free trade and agricultural subsidies: domestic interests within the EU override the supposed development objectives of the EU.

Norman Baker: Yes. Thank you, Chairman, again for inviting me along. Can I just give you one last bit of reassurance? We are coordinating these matters across different Government Departments, including DFID and DECC and other Departments that are interested-DEFRA as well-to try to ensure that we use the expertise within the British Government to get the best possible leverage across Europe.

Chair: Thank you very much indeed.

Examination of Witnesses

Witnesses: Lynne Featherstone MP, Parliamentary UnderSecretary of State, Department for International Development, Professor Stefan Dercon, Chief Economist, Department for International Development, Professor Tim Wheeler, Deputy Chief Scientific Adviser, Department for International Development, and Dr Kenny Dick, Team Leader, Food and Nutrition Security, Department for International Development, gave evidence.

Chair: Good morning, Minister. I think this is a first: two Liberal Democrat Ministers in front of this Committee in succession.

Fiona O'Donnell: Very exciting.

Q137 Chair: I just thought I should put that on the record, but I will not push my luck with my colleagues. I wonder if you could, for the record, just introduce your team.

Lynne Featherstone: I have Professor Tim Wheeler, who advises on techno things; Professor Stefan Dercon, who advises on almost everything, actually; and Dr Kenny Dick, who will be dealing with the questions I cannot answer on-which areas are you covering?

Dr Dick: G8 processes and global food security in general.

Chair: A bit more volume, I think, for this.

Lynne Featherstone: The G8 and food security.

Q138 Chair: We have a lot of ground to cover, so whilst we are perfectly happy to have all these highly qualified experts with you, if we just bear in mind that if everybody answers every question we will be here until well after any reasonable lunchtime.

Lynne Featherstone: We will do our best to be succinct and get through whatever you want us to get through.

Q139 Chair: It is just so that we cover the ground. To put it in the obvious context: the population is increasing, therefore the demand for food is increasing. Not only that, but as people become more wealthy, which across the globe they are, they tend to consume more food. We are projecting a population of 9 billion by 2050. From the Department’s point of view, what do you see as the implications for food security, and how is it being prioritised within DFID?

Lynne Featherstone: I think it is a very important issue to focus on. You have raised all the key issues, more or less: increasing population, climate change sweeping away development gain, urbanisation, all of those things. One of the issues is that there currently is enough food, it is just not necessarily in the right place at the right time; infrastructure in many of these countries means it cannot-market barriers, tariffs, all of those things. In terms of prioritisation, the main issue for us is poverty. Poverty is the main reason people are hungry, either because they cannot grow food or they cannot buy food, for whatever reason.

In fact the same goes for nutrition: those who suffer from malnutrition also do so because of poverty, so one of the key drivers in terms of prioritisation for DFID, is lifting people out of poverty. I would say that is the main driver and that happens in a number of ways, but there is no single quick fix to hunger or nutrition. There is a range of things. One of the key answers is the investment in agriculture, because so many of the populations are involved in and rely on agriculture, and therefore not just intensification of agriculture, but how smallholders are in the value chains for the corporate businesses, all of those things. DFID is working on a great number of fronts to address all of those issues.

Q140 Chair: We will go through those in detail, but before I leave it and bring in Chris White, the point I am making is this: I know you have only been in the Department for a relatively short time, but has there been any reprioritisation or refocusing of policy on the issue of food security, or is it a continuation of an existing mix of policy?

Lynne Featherstone: It is a continuation, because all of those things are absolutely key. I would say, in terms of climate change for example, and the Climate Change Fund, which we are looking at right now, we need to look at how we make sure we do the very best with the funds that are available. That is across not just my Department, but DECC as well, because in some of those things, like the future shocks-but there has been a shifting, if you like, to things like social protection in terms of trying to get over the risks so that people are secure. I think there has been a big shift in the focus on those sorts of things, so we look at social protection, production protection and financial protection. I would say those things are-

Chair: We have specific questions on those, so we will come back to those. The reason we have had two Lib Dem Ministers is that just before you we had Norman Baker on the issue of biofuels.

Q141 Chris White: We have been discussing the food security problems associated with biofuels, and as I am sure you appreciate, biofuels drawn from nonfood crops are markedly less problematic in terms of food security. What do you think the UK can do to support the development of nonfoodbased biofuels?

Lynne Featherstone: The issue of biofuels is key. I am sure my colleague will have gone through it in some detail, as he is the expert. Right now we are by law required to deal with the mandates and the targets set by the EU, but in the longer term our approach would be that we believe that we need a sustainable future, and therefore we are looking at third–generation biofuels, which will turn to things like algae. I will have to turn to an expert on this to give you the details, but the third generation moves away from any competition between growing food as opposed to using that land for biofuels, because that is where the harm is coming from.

Q142 Chris White: Just before you bring in one of your advisers, can I ask them to add on to their answer what discussions have taken place regarding the mandates you mentioned with other Government Departments?

Lynne Featherstone: My understanding is that Norman Baker has raised it in the EU. I understand that there are discussions and negotiations in relation to the renewable energy directives. It is hard to challenge the European Commission directly on this, but my understanding is that in recent conversations there seems to be a little more flexibility than there has been to date. There has been no consensus across the EU. I do not know what future discussions are planned at this point, but I can ask my colleagues.

Professor Wheeler: I can provide some answers on the technical applications, and maybe Kenny can give you a direct answer on the policy side. Clearly there is a lot of work to be done on two fronts. One is building the evidence base and making sure that any biofuel actions mitigate greenhouse gas emissions, however you calculate that-and there is some argument as to how you do that. Secondly, there is the generation of new technologies, in a way that they can be used by the communities that DFID works with. DFID has a programme called the PISCES Programme in rural India, which is enabling about 30,000 households to try to, at a very small scale, use bioenergy or biofuels in a more efficient manner for their livelihoods.

Q143 Chris White: I suppose, just to push you a little bit on the question, I would ask: do you agree that nonfood biofuels are less problematic in terms of food security?

Professor Wheeler: Clearly there is a conflict where you have a food crop being grown on land that is traditionally used for food provision, purely for a biofuel application. However, the area of land is reasonably small. Biofuel stocks are around 5% of global land use. DFID very much supports the approach of giving priority to food provision where there is that dual use, and would always look to try to ensure that smallholders are not disadvantaged through an undue emphasis on biofuel growth and provision. Perhaps if you want the policy question, Kenny is the one.

Dr Dick: I would say that we are in very regular contact with the other parts of Government that have responsibility for biofuel-daily contact around some of the specific things that we are looking for, for example in the social impact report from the EU, etc.

Q144 Chris White: Do you think you are making any progress?

Dr Dick: I think the EU is quite clear that the UK Government has a strong interest in this and has a view. I think the understanding that the social impacts are potentially significant and need to be monitored carefully is well accepted now by the EU.

Q145 Chair: On that particular point, Norman Baker mentioned two Commissioners, but he did not mention Commissioner Piebalgs. I raised that issue with him. Do you think he is not enough in the loop, or should be more in the loop, and is the UK Government engaged with him?

Dr Dick: I am not sure I could answer that. I would be very surprised if he was not, because his officials clearly hear from us very often on this.

Lynne Featherstone: I think there is a conflict of interest in parts of the EU.

Q146 Chris White: Sorry, this may be a cheeky question, but is that what is important? What is important is to look at the food security issue rather than the conflicts of interest within the-

Lynne Featherstone: No indeed, but in terms of trying to get people to look at sustainability factors, the ILUC factors, for those countries who do not want to change the basis on which we look at food security, that makes it difficult if you are talking about changing the actual targets or getting people to move. That is why there is an issue, because not everyone has the same view of the importance and priority of food security when it comes to their own productivity.

Q147 Fiona O'Donnell: Chair, could I just very quickly ask-the previous Lib Dem Minister was not able to answer this question-will biofuels be on the agenda of the hunger summit at the G8 summit in June?

Lynne Featherstone: The Government is not engaging directly with G8 countries on the issues of biofuels, but they have engaged-we have engaged-I must get used to that-G8 partners on the development of principles of responsible agriculture investment and voluntary guidelines on land use. I cannot imagine that it will not be mentioned, but it is not an official discussion.

Q148 Chair: You cannot really talk about land use and not make reference to biofuels.

Lynne Featherstone: I am saying I am sure it will be raised as an issue at the hunger event.

Q149 Chair: Can I just confirm-my understanding is that Nick Clegg is leading on the land issue within the G8 discussions for us, or taking a leading role?

Lynne Featherstone: You may have more information than me, Chair.

Q150 Chair: All I was going to say was that we were going to write to him to ask for clarification of this.

Lynne Featherstone: I have no doubt that at the hunger event that those issues must come to the fore, because all the issues around land will be raised, I would imagine. They will be key.

Q151 Mr McCann: I have a question on which everybody takes a deep breath at the moment, because I am going to talk about the western diet, in particular meat consumption. We know it is rising dramatically, particularly due to the spread of westernstyle diets in emerging economies like China. It has been suggested to us that it is unsustainable because of the quantity of cereals that are required to feed the livestock. I suppose the first question is: do you agree that it is unsustainable, and do you think the public in countries like ours understand that we will have to dramatically reduce our consumption of meat?

Lynne Featherstone: I am not particularly sighted on the meat issue. I will ask my officials if they are. My impression is that our meat consumption was dropping; you are saying it is rising in this country?

Mr McCann: We have taken evidence to say that it is rising in emerging economies, significantly rising.

Lynne Featherstone: Oh, in emerging economies.

Mr McCann: That is obviously leading to a global increase, which is unsustainable because of the amount of cereals that is required to feed the livestock.

Lynne Featherstone: Indeed, and then you have the whole issue about feed stocks, as well. Do my officials know more than I do? Almost certainly.

Professor Dercon: I am happy to contribute. What I would add is that we know in the context of rising food prices in recent years, that the livestock demand clearly was a factor in getting prices very high. It is quite important to realise that once we get the pricing of cereals, including the environmental impacts and so on, right in the markets, the price of livestock will also keep on increasing, so there is a likely push also from markets to make meat, over the longer run, substantially more expensive. Indeed, we see decreasing meat consumption in some richer economies already, which is also probably reflecting that. The key thing here is to get these prices to properly reflect all these environmental externalities, and then it will go. Obviously a lot to do with meat consumption has to do with habit formation, and we may need to work on public education. To say it is unsustainable is a difficult question. I think there will be pressures to reduce it, given that prices will be high.

Lynne Featherstone: Tangentially, when I was in Zambia I went to a market-I might explain more about that later-that is trying to help smallholders get more value and a better return out of what they can do on their smallholding. One of the products there was to help a smallholder get their cow to market. Currently it took seven years because of the ticks and things that were preventing the cow getting fat, so it changed from seven years to market to twoandahalf years to market. This is a microcosm of what you are talking about, but I am simply saying that at a local and small level, and in terms of helping smallholders, there are things that are improving, and a sort of personal intensification of agriculture. I do not know how relevant it is to eating meat, but it is another part of that.

Q152 Mr McCann: In the first evidence session we were told that there is a culture of systematic waste in the United Kingdom.

Lynne Featherstone: In the United Kingdom?

Mr McCann: In the UK, yes. What is the Government doing to deal with that problem? Are you sighted on that?

Lynne Featherstone: I am not sighted on what the UK is doing. I work exclusively internationally, unless there is an intrinsic link, like-

Q153 Chair: The sort of thing we had in mind was the "three for two" deals and things in supermarkets, which encourage people to buy more and then they finish up throwing half of it away.

Lynne Featherstone: I might very well agree, but I am afraid I do not know-I assume that would be a BIS issue, would it? DEFRA.

Q154 Mr McCann: So we are going to have to get somebody else in to talk about it?

Chair: Tesco, possibly, yes.

Lynne Featherstone: It is a good point, but it is not something I can answer on.

Q155 Mr McCann: Sure. My next issue is on nutrition. In DFID’s written evidence it states that there are bilateral nutrition programmes in over 10 countries. Can you tell us how many nutrition programmes precisely there are?

Lynne Featherstone: Not off the top of my head. I am happy either to ask an official or write to you with details of all the programmes, if you would like them. Nutrition is a key issue. In fact on one of my trips I was giving a talk to girls-it was an empowerment group-about some matters to do with sexual violence. I did not want to say some of the things I was saying, because there were some very young children in the room. They were not young children: that was my first experience of seeing stunted children, who had not had the right programme or intervention in that first 1,000 days.

We are certainly intervening in terms of our work with pregnant women, the first 1,000 days, encouraging breastfeeding. On the techno side, it is about introducing vitaminenriched products, and those are the sort of programmes. I can write to you with the absolute details of each of the programmes in each of the countries, if you are interested.

Q156 Mr McCann: That would be helpful, but in addition it would also be useful to know if DFID plans to increase the number of bilateral nutrition programmes.

Lynne Featherstone: I do not know if we are introducing new programmes at the moment, but our intention is to scale up, which is what you are really asking.

Chair: This Committee has form on the issue of nutrition and the Department. I think we can claim some credit for having pressed the Department to do more.

Lynne Featherstone: I have some details. Between 2011 and 2015, we will reach 20 million pregnant women and children under five with nutrition programmes. We are ensuring that another 4 million have enough food throughout the year. Since 2008, we have doubled our resources for tackling undernutrition. We have key programmes in Burma, Bangladesh, Ethiopia, India, Kenya, Mozambique, Nepal, Nigeria, Pakistan, Somalia, Tanzania, Uganda, Yemen, Zambia and Zimbabwe. Our focus is undernutrition from the start of pregnancy to the child’s second birthday. Over the last period we have doubled our nutrition input, our funding to nutrition.

Mr McCann: It would be helpful, Chair, if we could get specific detail. I think that was more of the detail there on the specific bilateral programmes, not just the overall effect. If we can get details-

Lynne Featherstone: Of each of the programmes?

Q157 Chair: Perhaps also the criteria – just, again, looking at our notes of previous evidence, I think it was Ertharin Cousin of the World Food Programme who said that 33 developing countries have committed themselves to nutrition programmes. Her starting point was that any programme DFID is operating that had made such a commitment, that DFID should surely have a bilateral programme to support that. I am not asking you to answer that question now, but I think it would be quite helpful if you could give us a response to it.

Lynne Featherstone: I am happy to do that. It is a focus of our programme, as I say.

Q158 Fabian Hamilton: Following on from my colleague Michael McCann’s questions about meat, Minister, it is clear that in order to make sure that everybody in the world has enough to eat the rich western countries need to reduce their meat consumption. I wondered, following on from what Professor Dercon said earlier, what is the best way of reducing meat consumption in the west, and in the UK particularly? Is it by having higherpriced meat? Is it through food scares like horse meat and other contaminated food scares that put people off meat? Or is it people’s concern about the environment or their own health? What are the incentives that will stop people consuming ever more meat in this part of the world, do you think?

Lynne Featherstone: I think all of the issues you have raised will contribute to that.

Q159 Fabian Hamilton: What is the main factor?

Lynne Featherstone: I am not sure there is a programme-at least I am certain there is not one from DFID. It will not be a DFID programme. I do not know whether the UK Government has a programme to put people off eating meat. I would think expense would be one of them, but that does not mean it would stop people eating meat; it just means they go to cheaper meat, and probably the bits with horse in it. We could have a conversation about it, but I would not be giving you a ministerial view, because it is not in my Department.

Q160 Fabian Hamilton: Let us look at what is in your Department. Presumably you are responsible for what happens in other parts of the world. I know we do not have a programme in China anymore-at least I do not think we do-but China, with its huge population, has seen meat consumption almost treble, I think, in the last 15 years. Does that cause you concern in DFID?

Lynne Featherstone: To be perfectly honest, it has not come across my horizon. I am not saying it should not have, but where would you say that sat?

Chair: I think an issue here is-sorry, if you want to come in, Professor Wheeler-

Lynne Featherstone: Yes.

Professor Wheeler: Perhaps I could make a couple of points in context. China is really key to this. China consumes nearly half the world’s pork, for example, so when we talk about the contribution and the role the UK is playing, it is a tiny, tiny signal in the global meat and livestock trade. Professor Dercon’s earlier point that it will be reflected in the price going forward is right. In terms of the higher order global food security questions, it is one of those important pressures that leads to that headline figure that John Beddington and others used, that we need to up the productivity of the global food system. The figure that is often used is an increase of 6070% by the year 2050. This is very much one of those pressures on the demand side of food security.

Q161 Fabian Hamilton: Can I just come back to the question I put to the Minister? It may not strictly be within the remit of the Department, but what is it that will make people who consume meat in the west consume less? Is it concern for their own health, their general concern for the environment and other people on the planet who do not have enough to eat, or is it simply price?

Lynne Featherstone: I think generally selfinterest works better on people.

Fabian Hamilton: So health and price?

Lynne Featherstone: That would be my guess, but it is a guess. It is not an evidencebased answer, I am afraid.

Q162 Richard Burden: The way this discussion has gone prompts me to raise an issue that I think is relevant to it. Behaviour inside the UK is important to the overall debate about food-the amount of meat consumed and so on. That debate can only really be understood in the context of a global food security crisis, where I think that you say, in a sense, we are a bit player in terms of the quantities concerned, compared to China and so on. Yet the messages that go out and the discussions that take place amongst people in the UK are relevant to how Governments behave and how Governments project what they want to do on the international stage.

Given that, is it not important that some of the global messages around food security, which DFID is intimately involved with, are actually put out there and discussed inside the UK? If that is the case, how does that link with DFID’s decision, which I think was ministerial, to get rid of outreach work in the UK about what DFID is doing?

Lynne Featherstone: In terms of communication, you are right; there is an issue. I am not sure that all outreach work would be helpful, and how much you can afford to do of any one thing, but the greater impetus on the budget in DFID is to deliver programmes, either bilaterally or multilaterally. In terms of communication, there is a debate, but at DFID we place endless messages out there. It tends to be responsible tenure of land or responsible agriculture or responsible private sector operation, rather than the responsibility per se about our personal behaviour.

Q163 Richard Burden: Is there enough communication across Government about this? There is a legitimate argument to say, "Those messages and those discussions do need to take place, but it should not be DFID that does it." I am not sure I completely agree with that, but it is absolutely logical to argue that. If DFID does not do it, however, who does, and do they talk to DFID about it, because of the incredibly important international context all these things happen in? What are the mechanisms around-

Chair: The sort of thing members of this Committee find themselves discussing in schools in their own constituencies.

Lynne Featherstone: To be frank, it is not a discussion that has come my way, so therefore there simply must be a lack in terms of communication on those particular issues. I think it is discussed in a number of ways, but it is always practical about how you are spending money or how you are doing things, as opposed to what you are asking for, which is an awareness campaign across Government asking "How does this fit with that?" I am not aware that that is happening. It does not mean it is not happening, but I am certainly not aware of it.

Q164 Fiona O'Donnell: If it was joinedup you would need to be aware of it, because DFID would need to be part of it.

Lynne Featherstone: I would. The only caveat on that is that hunger, food and nutrition is not in my personal portfolio, so it may be that somewhere else in DFID, or in another Minister’s portfolio, that is actually happening. I will take it away and have a look at it. It is a fair point.

Q165 Hugh Bayley: Let us move on to another subject. It is selfevident that farmers need finance, because they need money upfront to plant their crops and fertilise their fields and buy machinery, and then it takes some time-weeks or months-until they harvest and are able to market the crops. Smallholder farmers, who in developing countries produce threequarters or 80% of the food, find it very difficult to get finance from the banks, because they have no collateral. They do not have land titles or agricultural machinery.

It was suggested to us by one of our witnesses from the International Food Policy Research Institute that donors could help by guaranteeing loans for smallholder farmers, and that you would get a manifold return on the money, because in the vast majority of the cases the loans would be repaid in the normal way by the smallholders. Is this something that DFID would consider, guaranteeing loans to smallholder famers in developing countries?

Lynne Featherstone: As far as I am aware, I was not aware of that suggestion. We do many things for smallholders, but I do not think direct loan guarantees have been one of them to date, in any sense. I can take it away and ask if it has been looked at. Professor Dercon has some information, and then I would like to talk about some other things that we are doing for smallholders rather than what we are not doing for smallholders.

Q166 Hugh Bayley: Oh, good, yes. We will do that first, then I would like you to tell us what else the Department is doing; that would be helpful. Thank you.

Professor Dercon: I wanted to add that the starting point has to be that the diagnosis that the main thing that smallholders are lacking in developing countries is finance could be quite contested from the evidence base. It is an important thing, and I will not deny it, but you have already raised some other things needed to get these things going, such as working on titling, other factors that enable markets to work well, proper elements of value chains, links between input suppliers and farmers and so on. There are an awful lot of different things that can be done.

At the same time, directly and indirectly, DFID is supporting a huge amount of financial inclusion types of programmes, which include things to do in rural contexts, and financial inclusion rather than focus on credit is probably the right thing to do. I think the person who gave evidence from the National Food Policy Research Institute also raised things to do with insurance, risk management and so on. It is often to do with packages of these things.

Q167 Hugh Bayley: Can I be blunt and direct? Is that a "No"? You are saying DFID’s choice would be to invest your resources in other initiatives to improve the creditworthiness of-

Professor Dercon: I do not think the evidence base is strong to say this is the right thing to do.

Q168 Hugh Bayley: Lynne, you said you wanted to say some more about what DFID is doing.

Lynne Featherstone: I am very keen on smallholders. They are a huge swathe of the populations and a huge way to produce in terms of the agriculture of a country. Increasing the productivity of smallscale producers is key to food security, both in terms of how a family with a smallholding feed themselves, but also in terms of crops potentially. There are a number of things that the UK is investing in. There is the public goods part of it: transport, research, investment climate, and we are doing that in 25 countries to benefit smallholders and small farmers. There is land tenure: in Rwanda, by 2015 we are expecting 4 million smallholdings to be registered and titled.

Hugh Bayley: We will probably come back to that.

Lynne Featherstone: We may come back to that when we get to land, for example. In Malawi, our support to farm input subsidy programmes is helping 1.5 million small farmers. I can send you the list quite happily. Having seen it in action, it is quite profound. I have seen it in a few ways now myself. In Mozambique, the Beira agricultural corridor has helped to produce and create a market so that smallholders can bring their product, or their innovation, to a market. That will produce 300,000 jobs. We have not gone on to the private sector and all of that yet.

The other thing, for example, which I saw in Zambia, was the big corporates. There is this perception that the big corporates are bad for the small guys, and all of that. I will go into the stats on that, if you like, about how it is not doing that, though there is not the same fear. I went to see Zambia Sugar, for example, which is very, very big. There is literally a whole-I would not say a gang-community of smallholders who all have their produce bought by Zambia Sugar. They have a secure market set up. They have also set up a Chamber of Commerce, effectively, in the area in which they work. It is a very inclusive value chain, if you like. I went, in Mozambique I think-I sometimes get my countries mixed up as to where I have been, but it was Mozambique or Zambia-

Chair: It has been known to happen.

Lynne Featherstone: It was in Mozambique, I think: it is where the cow product was that I was so impressed with. They have big seed and grain suppliers being brought to this market in the middle of nowhere, where lots and lots and lots of smallholders can come. There is an exchange going on. The big suppliers get their seed bought, but the exchange is they have very good seed, so the productivity from that smallholder is increased. They also give all the technical advice to the smallholder, so it is capacity building in terms of how to plant it, when to plant it, how to water it, all of those things. All of these things are changing the basis on which smallholders can operate.

Q169 Hugh Bayley: Could I ask just one other point? You have cited some examples in which markets are created that benefit smallholders, but it is still my view that most smallholders sell most of the produce that they are seeking to sell, rather than use for their own family, to middlemen, and they then sell it on to some other user, at many times the price that the smallholder gets. It was suggested to us by the Fairtrade Foundation that if smallholders were told what the final price to the brewery or the supermarket was, they would be in a much stronger negotiating position. Would you agree that that is a problem, and if so, what could DFID do to create greater market transparency for the benefit of smallholders?

Lynne Featherstone: Certainly I would agree there is an issue about information to market. I think that is being transformed, in a sense, by mobile phone technology. There is a programme-I think it is in Pakistan, is it not? Who has the information on that?

Professor Wheeler: Yes, there is a programme in Pakistan, providing exactly this sort of information using the mobile platform. Of course the FAO has the AMIS programme-the Advanced Market Information System, I think it is-which is very much addressing those points you have raised.

Q170 Hugh Bayley: How could you broaden schemes of that kind? Should it be a priority for DFID to do so?

Lynne Featherstone: All of these things are moving forward. That sort of thing is beginning to spring up on its own incountry. There are a number of networks-I forget their names-that actually have full networks of information through mobile phones, not just DFID programmes but incountry programmes. They are vast, and are transforming the information in terms of what the price should be so they cannot be gypped, I guess. I think it is phenomenal.

Obviously we at DFID are moving with the technology very fast. It is a great part of the answer in terms of information, because up to the point of mobile phone technology, radio was literally the key transmitter. Now it is quite extraordinary to go to some of these farflung places-I am sure you as a Committee know that, because you go there as well-and see them having that information, let alone the MPesa and the banking and all of the things that are now done.

Q171 Chair: I think the Addis Ababa exchange had put up electronic notice boards in the provinces, to show instant prices.

Lynne Featherstone: I think all of that will drive change. I think you are right, is what I am saying, and we are involved in all of those things. I was going to go on to the social protection programmes of DFID.

Q172 Fiona O'Donnell: We will come on to that, I promise. Minister, it is very reassuring to hear that smallholder farmers are absolutely on your agenda and your enthusiasm. They are feeding a third of humanity, and your fellow Minister, Alan Duncan, has pointed out that in their own countries they feed 90% of the population. Obviously extension services are also part of getting access to basic information about how to improve crop yield, and deal with things like global warming and climate change. Can you tell us how DFID recognises this in its own work?

Lynne Featherstone: If it is for example through climate change, that is something that knocks everything before it, and particularly-

Fiona O'Donnell: So that I do not steal someone else’s thunder, could you focus on agricultural extension services? I am thinking about Nigeria, where only 2% of farmers have access to agricultural extension services. What is DFID doing to focus on this?

Lynne Featherstone: In Nigeria, for example, we have a programme called Propcom Maikarfi, previously called RAMP. It is a £27 million programme that targets 250,000 rural women to raise their incomes by 50%. I would have to turn to an official to say exactly what is in that programme.

Q173 Fiona O'Donnell: Is that going to take us beyond 2%, then?

Professor Wheeler: I have another example, sorry.

Lynne Featherstone: I have a number of examples, but I think the programmes support, for example, women farmers and entrepreneurs across agricultural value chains, to increase the value. In Somalia, we have a sustainable employment and economic development programme, which improves economic and employment prospects for women and girls. We focus on generating employment in livestock, fisheries and the agricultural production sector; that aims to create 20,000 jobs. I am sorry, I am kind of doing women as well. Is someone else covering women?

Fiona O'Donnell: I know it is a big issue for women.

Lynne Featherstone: It is a big issue for women in terms of the smallholders. We support them through capacitybuilding and credit through intermediaries. In Zimbabwe we have a core growth programme that expands access to financial services for the active poor, especially women. Women are becoming more and more involved in trying to move from smallholders to farmers. It is quite interesting. I have met a number of women farmers.

In terms of our smallholders, in the last year DFID spent about £500 million on food security. Much of that was on programmes to support smallholder agriculture. We have some difficulty tracking some of this, because the OECD Development Assistance Committee do not do it by gender, but in at least 13 countries in subSaharan Africa and Asia we are investing in public goods: that is infrastructure, research, and an enabling environment for agribusiness. We create market opportunities for smallholders, some of which I described. I told you about the land tenure reforms. In Malawi we are funding a farm input subsidy programme that will help 1.5 million poor farmers increase productivity.

Q174 Fiona O'Donnell: The IF campaign particularly is focused on this issue. Could I just ask, will the issue of smallholders be on the agenda at the hunger summit?

Lynne Featherstone: The agenda is being worked out, and the details are being worked out as we speak. Obviously I am aware of the IF campaign on smallholder agriculture. We have some issues with the actual ask, per se, which is an increase of $660 million-either dollars or euros-per year. The evidence they have used is just from one piece of FAO work. We would say that we prioritise them, and I particularly think they are incredibly important, but I do not necessarily think that it will be totally aligned with the ask from the IF campaign, because of the way we do our programming, which naturally has to go across a number of things, all of which contribute. If we do not deal with climate change, that will sweep away smallholders.

Fiona O'Donnell: Access to markets. Yes.

Lynne Featherstone: All of those things. We agree with the IF campaign, but we have a different approach from the IF campaign on that.

Q175 Fiona Bruce: You have quite rightly referred to land ownership as being critical if farmers are to feel secure about working their land and then reap the rewards of doing so. I have a number of questions about land tenure, and what I think is now, by some campaigners, being widely referred to as "land grabbing". If I could start by just saying that in his speech outlining the UK’s priorities for the presidency of the G8 during 2013, the Prime Minister said this: "We are going to push for more transparency … on who is buying up land, and for what purpose." Could you tell the Committee how you propose to promote that greater transparency in land use?

Lynne Featherstone: I cannot speak for the Prime Minister, but I think transparency is key. The minute you do not know who owns it or what they are doing with it, that is the issue. The other thing is that you said "land grab", but "grab" is really pejorative, because some land that is sold for commercial investment may be a very good thing for a country. The total land we are talking about is very small. That having been said, full credit for putting transparency at the heart of the G8. My understanding is that what we are really pushing for is effectively an open, worldwide land register, ultimately. That is the kind of thing. How that will be persuaded or operated is not in my purview.

Q176 Fiona Bruce: It is very interesting. You have referred to the very impressive work that DFID has done in Rwanda, with £40 million provided to help with the registration of land. I am particularly impressed, because as a lawyer with a background in property, I know this country is still working on their land registration from 1925. In Tanzania, too, you have worked with Farm Africa. I just wondered, now that this issue is very much coming to the fore-and I think that Oxfam have said that up to 58% of commercial land transactions now could be potentially for biofuels-it is becoming increasingly concerning, and I am wondering whether DFID is going to look at investing further in similar land registration projects elsewhere.

Lynne Featherstone: In fact, I was discussing that with the Committee to say, "How much further are we going?" because it has been tremendously successful in Rwanda. I do not have the answer on what is in the pipeline, but at the G8 itself we will be pushing very hard on the voluntary guidelines on the responsible governance of tenure of land, fisheries and forests. Our aim is to secure agreement from major G8 investors to commit to publish data on land acquisitions, and make that accessible to local communities, whether it is biofuels, commercial investments or China buying some land with an eye to in future feeding the Chinese rather than the Africans, which is always the fear that has arisen.

The answer is to be able to see who is buying what, and then trying to get countryled, as well as externalled programmes. The hard evidence that we can get is pretty limited at the moment on what is being grabbed, by whom, and for what, but the recent estimate we have is that there are deals covering 83 million hectares, which is 1.7% of global arable land. It is small, but it is a very real issue, and I think now is the time to try to set the principles on which the world can work, whereby communities would be able to see and therefore hold their own Governments to account one day. We do a lot of work with civil society as well; it is not just governmental. We need people incountry to keep pushing as well.

Q177 Fiona Bruce: Excellent, thank you. I am pleased to hear that, and I am pleased to hear also that you referred not just to land but fishing, because that is a key issue, having been to Tanzania and seen the impact of some commercial fishing on Lake Victoria. It is having a real impact on those who live along the lakeside. You will be working with countries to help them implement the UN’s voluntary guidelines on land tenure?

Lynne Featherstone: Yes; we think that is really, really important. As the Chair said, I have only relatively recently come to this portfolio, but the way in which we operate is very much to set out what is right and good, and then work with countries and civil society to enable that to happen.

Q178 Fiona Bruce: I would be very interested if at some stage the Department could report back on how it is working with countries on this issue, both on the voluntary guidelines and with regard to perhaps extending the Rwandan project.

Lynne Featherstone: Okay.

Q179 Fiona Bruce: Thank you. A final question if I may, and it relates to the World Bank. Commercial investment in agriculture is often supported by loans from the World Bank, and Oxfam has suggested that a sixmonth moratorium on any World Bank lending of this type might allow the Bank to assess the impact of such investments. I wondered whether you would support such a proposal of a moratorium.

Lynne Featherstone: No, that is one area where we disagree with Oxfam, inasmuch as we do not think that would be effective. We also do not think the World Bank is the worst offender by a long shot. They do an awful lot of good, and they are looking at the way they do things, and we are working with them on their policies. There are occasions when I think the best way to get the best out of someone, or an organisation, is to work with them, not make their life more difficult.

Q180 Fiona Bruce: So your view is that perhaps it is more commercial organisations and commercial companies internationally that are perhaps some of the worst offenders in terms of the big land purchasing?

Lynne Featherstone: Yes. There are issues out there, without a doubt, but I do not think the World Bank is the answer, so therefore we disagree with the IF campaign on that one.

Q181 Hugh Bayley: We were talking earlier about the Government’s development priorities for the G8. I know from the runup to the Gleneagles G8 that an enormous amount of preparatory work was done through bilateral meetings with the other seven G8 countries, and that you do not deliver results at the conference unless you have built commitment earlier. Could I ask, shall we say, since the start of this year, how many of the other G8 countries our Secretary of State has had a bilateral meeting with to explain the development goals we have for the G8? Can you give us a guarantee that before the conference she will have had a onetoone with her opposite number in each of the other seven countries to seek commitments to the goals we are developing for our summit?

Lynne Featherstone: I cannot guarantee, and I do not know whom she has met with on a onetoone basis. We can find out and let you know. However, she does-I was going to say "bomb around the world" but that does not sound very Secretary of Stateworthy-and at all of these things she will meet counterparts, with whom I am sure she discusses this. You are absolutely right: in terms of what will be delivered at the G8 it would be unimaginable that most of it is not worked on extensively in advance. I am not privy to the-

Q182 Hugh Bayley: Could we just ask that you take the question-

Lynne Featherstone: I forgot to say, when we were talking about land grabs, that most of the acquisitions are internal, still. The majority of land purchased is within the country, still.

Dr Dick: I just wanted to make the point that the negotiations around the G8 are also led by the Cabinet Office, so there are Sherpalevel discussions. There are sectoral working groups; for example, I sit on the food security one. We are conversing with our G8 partners every day of the week. On the Secretary of State data, I am sure we can get that, but it is a multilayered effort to try to get to the point.

Hugh Bayley: I appreciate that from last time, but there is an added level, is there not-an added value that comes from getting the political head of the Department to meet with the political head?

Q183 Richard Burden: Without proper irrigation, it will be impossible to optimise the use of land for the various objectives we have been talking about today. If crops are produced and there are no roads, they cannot go to market, and while they are waiting to go on the road, if there is not proper crop storage, they are wasted anyway. Could I ask you to say something about how you see the relationship between the development of those forms of infrastructure, and tackling the food security issues we are talking about, and in particular what more you think should be done, maybe through the World Bank or maybe through other development banks?

Lynne Featherstone: The issues you raise are absolutely key. Irrigation is one part of it. Water more generally is a massive issue. The infrastructure, and getting things from place to place, seems to be one of the biggest barriers. The issue of food loss or waste is massive. I think about 30% of food that is produced is lost or wasted. One of the ways we tackle that particular thing is through our agricultural research programme, and in developing countries it is right to say the major problems arise from transport, storage and processing of food. Some of the work we have done is about storage of food where it is grown, so hermetically sealed food on site, before any transportation.

There are other things: I think it is cassava that can be processed as the crop is taken-I am not sure if it is cut or dug; forgive me, I don't know much about cassava. There is a lot of work that is going on to reduce that sort of waste, but in terms of infrastructure the problems are much larger. It is not something to date, as far as I am aware, that DFID has really put funding behind, other than through multilaterals, but I am prepared to be corrected by an official. Infrastructure is so massively expensive that we tend to work by encouraging the private sector to get involved.

I do not know if someone is coming on to the private sector, because I never know who has been allocated which bit, but one of the big issues that we have not really addressed is the raising out of poverty by investment either from within Africa or externally. Some of the things that need doing are so expensive that it is probably beyond even DFID. I do not know if any of my advisers want to comment on that.

Professor Wheeler: Maybe I can make three points. I agree with the points you have made. Agricultural sector growth is essentially trying to knit all those together. There is such a wide expanse of potential interventions that working on one alone, for example improving road infrastructure, without addressing some of those fundamental issues about production, irrigation or use of technologies, will be limited on its own. It is about the package of interventions.

It is also about working out where your investments are most efficient. A piece of evidence that DFID funded that was released this week showed how effective investments in the road infrastructure and the access to market infrastructure were in raising agricultural productivity, and there were other things that were less effective. You get some guidance there as to where investments in this vast array of possibilities could be most efficient. Returning finally to that last point, a lot of these impacts on the productivity of the food system are outside of the food system, so interventions have to be considered in a much wider context than just the food and agricultural system itself.

Q184 Richard Burden: Given that a lot of those activities and those investments rightly take place take place through multilaterals-an awful lot takes place bilaterally, often done by China, but let us just look at this-are we across that properly? Are we across understanding what works, influencing what the multilaterals do-the World Bank or the development bank-and what are the lessons coming from that? To give perhaps two examples, the first is irrigation. Our report in 2007 found that only 3.7% of arable land in subSaharan Africa was irrigated, whereas the proportions in India and China are much, much greater. That is a bit out of date now-that was 2007-but what is our overall policy direction that we are trying to get the World Bank and others to develop in relation to irrigation? On the one hand, there is huge need there, but on the other hand, you do not want to get into what, as some places have said, have been problems in relation to India and elsewhere, where doing that the wrong way or too intensively leads to oversalination? What are we doing, who is doing it, and how do the different bits link up?

Professor Wheeler: I will not speak on the policy direction, but in terms of the technical direction, it is really to work on the efficiencies of all those different components. We know, as you say, that the widespread use of irrigation is not found in the continent of Africa, excluding Egypt. Where it is found, it is relatively inefficient, so the use of that resource is relatively inefficient. Through some of the research programmes, we are trying to work out how better to improve the efficiency of irrigation systems and how to use small quantities of water in a more efficient way, by better understanding their link into, for example, crop growth. In terms of storage, the hermetic storage is a good example. There are some reasonably small-scale initiatives that you can do that will improve, at a relatively low cost, the efficiency of the storage, and work into that 40% loss that is generally found within developing farmer agriculture.

Q185 Richard Burden: That is interesting, but what I am trying to get at is not really whether DFID is involved or supportive of work to find out what works and what does not work. My point is: having done that research, amassed that knowledge or worked with others, how does that then translate through to what the multilaterals actually do? I will give another example of roads. We did a visit last year to the DRC, Rwanda and Burundi, and a major emphasis was put to us on the role of TradeMark East Africa and its role in building roads. I am sure they did some really good work, but I would like to know where the policy readacross is between what they do in practice and what the strategies are for improving food security there. Where do you make judgments and who makes the judgments between whether you try to go for firstbase road construction in DRC, where there is virtually none in certain parts of the country, and improving some existing infrastructure, which needs to be improved a bit more to get trade going a bit more quickly? I am just not getting a sense of where DFID’s food security policy links up with its interaction with the multilaterals and with the projects it funds, like TradeMark East Africa. It may all be working properly, but nothing you have said tells me where those links are, unless I am missing something.

Lynne Featherstone: Working in a direction is part of it. There are massive challenges, as you identified, wherever we work. They are raised with multilateral partners when you go to countries, but there are so many different circumstances in which you find yourself from country to country that I am not sure there is an overarching strategy. We support the trading blocs. You mentioned East Africa TradeMark-is that what it is?

Richard Burden: TradeMark East Africa

Lynne Featherstone: TradeMark East Africa, ECOWAS, etc. My input on, for example, that particular one has been trying to encourage the Ministers involved in that to work together in Africa, to deal with some of the issues at their end. Where I have not linked it up myself is with the work that we may or may not have influenced within various multilaterals.

On one other point, in terms of evaluating what works and what does not work, there is a new innovative programme, for example. I think climate change is very closely linked with the water issue-either too much or too little. There is a new Agricultural Innovation Window under the 3ie programme, which we cofounded with the Gates Foundation, the International Fund for Agricultural Development and the Alliance for a Green Revolution in Africa. In terms of how we link it up, we take what we are interested in, and that is the partnership that then forms to promote that direction. I don't know if that is helpful at all.

Dr Dick: Perhaps if I could add a little bit. I am not sure we have something at the global level that covers all that, in part because, as we said before, we think that one of the key things that will solve global food insecurity is economic growth and agricultural sector growth, so in a sense infrastructure and all those other things are key to those.

At the regional level, for example, to get into the nuts and bolts, we have an Africa Regional Department, and that Africa Regional Department has infrastructure advisers in it, and those infrastructure advisers look across all the investments that we will be making in infrastructure in Africa. It engages with the Africa Development Bank, with the Private Infrastructure Development Group and with the World Bank on everything to do with infrastructure development in Africa. Then it works out where DFID investments can be made that will add most value to the efforts of either the multilaterals, or stuff that we do through other agencies or through our own bilateral programmes. At the regional level, at least, there is a joinup, and that infrastructure adviser will sit next to a food security adviser or an agriculture adviser. Globally it is a bit harder, but at least regionally those connections are made.

Q186 Hugh Bayley: Minister, what does your Department see as the role of GMOs in providing food security?

Lynne Featherstone: I think it probably has part of the answer. DFID invests, I would say, 90% of our research budget in conventional methods for intensifying productivity; 10% is cuttingedge stuff, which takes about 30 years to come online. Some of the things that GM can do are amazing, like the invention of scuba rice-when I first heard about a rice that could go dormant during a flood and then carry on growing when the flood recedes, I thought those sort of things are remarkable.1 Whether it is using less water, which would come into the last question, or adding nutritional Vitamin A to foods, it does incredible things, but it really is for a developing country to decide for itself how much it wishes to use a GMoriented agricultural programme. During its origins in this country, I certainly grew up in the formative time when we were scared of the GM monster-in my formative years, those were the mythologies-but the evidence that seems to come forward is that there has not been a track record of harm and there has been a track record of some very, very good innovations. However, it really is up to each country to decide.

Q187 Hugh Bayley: Good. Sir John Beddington gave us some evidence where he said the issue should not be GM versus nonGM; it should be, "Does this particular crop pass the tests of good yield, good safety, and so on?" and you seem to agree with that. What more do you think DFID could do to ensure that the benefits, where there are benefits, of GM technology in crops are used to benefit the poorest people? What needs to change to make sure the benefits are dispersed amongst the poor?

Lynne Featherstone: I am not sure that it is DFID’s role to promote or not promote. The information should be out there. Even developing countries have access to information, and quite frankly the private sector companies who mostly sell the products are working very closely, right around the world, with all of the Governments. I do not think it is lack of information, particularly. It is private sectorled, and they are very big corporations who, on the whole, can take care of themselves and promote themselves very ably. What we do is, as I said, spend 10% of our own budget on research on the cutting edge, because of the advantages it could bring should a developing country want to go that way. Recently I met a crop-a GM crop-of people who were telling me about cotton. This is not part of food security, but what they have done with cotton is miraculous.

Q188 Hugh Bayley: Just for example, most-possibly all; I am sure the scientists can advise-of Governmentfunded research into these novel agricultural products in the UK, I think, is distributed free. Is that something that DFID should look at, to try to ensure that more of the good GM products are publicly owned and delivered without requiring a licence fee, in effect, to a provider? What more could you do in that field? Maybe one of your team could comment.

Professor Wheeler: It is fair to say that in generating new technologies, DFID’s research is all towards public good, available products. In the UK we work closely with the John Innes Centre, for example, in Norwich, which has expertise in this. Globally we work together with the Bill & Melinda Gates Foundation on products such as more waterefficient maize for Africa. These are all public good products and all are tackling problems that, through conventional means, would either take a long time or simply would not be possible to solve.

Lynne Featherstone: We also support farmerled research incountry, trying to help the demand internally in developing countries.

Q189 Mr McCann: Richard Burden and Hugh Bayley have touched upon this already, but DFID’s written evidence summarises its work on agricultural research. I am keen to understand the link between research and policy. Could you give us perhaps a couple of examples where our investment in research has yielded policies that are working out in the field?

Lynne Featherstone: In terms of nutrition, for example, we supported the development and rollout of orangefleshed sweet potato, which is enriched with Vitamin A. That is rolled out to 24,000 families in Uganda and Mozambique, and that came from research. As I said, in South Asia the development of scuba rice has helped farmers increase resilience to the effect of floods. We have supported biotechnical research on bananas, maize, cowpeas and rice varieties that are resistant to different threats, and we then have programmes to deliver or support. We have so many programmes that use the basis of our report, but we can write to you on the specifics.

Q190 Mr McCann: It would be helpful, Minister. Could anybody answer the question: how long did it take? What was the timeline from research to delivery?

Lynne Featherstone: That I need to ask; I have no idea.

Professor Wheeler: There is a range of responses in the programmes. There are some very specific shortterm policyoriented research programmes, and the Future Agricultures Consortium would be one example of that, where those researchers are working directly with developing country policymakers within the ag and food sector. Then there are the much longerterm commitments, such as some of these nutrition programmes, where essentially the evidence and the technology is being built up within a research programme over 10 years or more, which provides, in a sense, a tool that the policy programme can then work with. Some of these nutritionenriched staple crops now are at the stage where they are available to be rolled out through policy programmes, but it has taken 10 years or more to get to that point, in those examples.

Q191 Chair: The previous Committee in the previous Parliament looked at food right at the time when food prices hit their spike-in fact, when the then Prime Minister Gordon Brown held his Food Summit, it somewhat coincided with the evidence session of this Committee, and I think had something to do with it. At that time and subsequently, people have talked about what factors cause food price rises, and one of those has been speculation-people speculating. Although obviously the evidence is difficult, it has been suggested that speculation of that kind could have increased food prices by between 15% and 17%. Granted, the spikes were much higher than that, so you could argue it is not the determinant driver, but it is still significant. Do we accept that speculation has a contribution to make, even if the actual impact is questionable, and what could be done to tackle this?

Lynne Featherstone: The evidence or the analysis came to the conclusion that speculation was not the main issue. It may have been a small contributing factor to a small bit of the pricing, but the main problem was basically supply and demand when there were food price spikes. One of the main planks of the way DFID has approached food price volatility-which is probably likely to get worse, I would say, over time-is through social protection programmes, because cash transfers stop smallholders from having to sell their livelihoods for the duration of the price hike, so they do not lose their sustainability. That is probably one of the most important innovations we have seen in recent times-a continuation of the ability to be selfsustaining and to be sustained throughout a period where that would not be possible. One of the issues that struck me most coming into post, which often happens with humanitarian aid, for example, and has knockon effects for prices and so forth, is that if you do not deal with the sustainability of the product, the people and the financing, you go back to square one every single time. You cannot change anything.

Q192 Chair: I think we accept that, and we will explore some of the other aspects, but I am just trying to tie you down on the specifics. It seems to me that where there is a sudden spike in food prices, that is exactly the moment that speculators are most likely to intervene. Certainly in Australia and South Asia they have had position limits, where there has been a legal restriction on how much can be held. Does the Government have a view on whether this has a role to play in limiting the opportunity for speculators to add to a supply and demand spike?

Lynne Featherstone: I will ask Professor Dercon to come in, because he is an expert on that, but my understanding is that that is not really where we are looking, because we do not think the evidence points to speculation being the problem. Our efforts are aimed towards those aspects that we do think are the problem. Stefan?

Professor Dercon: It is of course a highly contentious issue in the evidence base and amongst researchers, but I would say that the call to make on the evidence base is that it probably contributed very little to the spike at the time. We could supply you with some of what we think are the better research papers. There was a very well attended highlevel conference six months ago in the US that came more or less to this conclusion as well, so in terms of the responses it becomes then a little bit less relevant. Let’s not deny that there will be occasions in food markets where positions can be taken and that there are benefits to be had and maybe some speculative forces could be there, but in general I would say that although we can blame financial markets for lots of things, maybe not for the food price spikes.

In terms of how to respond, as the Minister was saying, it is in the real economy where the bigger pressures were. A much more important part of why the spike developed following some supply shocks and of course these long–term pressures of demand that we touched upon earlier, was what was happening in the trade environment-export bans and so on. Arguably, putting your effort into ensuring that global markets for food keep on working well and that there is global action so that you can keep on avoiding these kinds of responses we have seen, which definitely exacerbated problems quite dramatically for some of the poorest countries, is quite important.

Chair: Okay, that is clear.

Q193 Hugh Bayley: Climate change poses a serious threat to food security. What should DFID’s priority be: working on climate change adaptation, or climate change mitigation?

Lynne Featherstone: You have to do it all. In terms of the International Climate Fund, 50% of that goes around dealing with carbon emissions-20% on forestation and 30% on adaptation-but they are movable as we progress. As I began to say, one of the things that struck me in post was about building in resilience; that is absolutely critical, and should be critical to all of our programming. The Sahel is, for example, in my purview as Minister for Sahel and subSaharan Africa. Some of the shocks are relatively predictable-drought, flood, and all of those things-and some of the answers are biotech and advanced technology, but there are different ways.

In terms of the financial risk, we are looking at insurance instruments, for example. We are looking at production, and we are looking at social protection-the human side. There are three ways of adapting to what is happening and building resilience. When you rebuild after a physical shock, it is building resistance and resilience in the housing stock, for lack of a better way of doing it. If it is about floods, some of it is about developing things like the scuba rice. If it is about people then, as I said, the social protection programmes have been incredibly helpful in building resilience so that you do not go back to square one.

Obviously those shocks will increase; with climate change we can expect to see further extremes of weather, and one of the priorities is looking at how we cope with an increasing and more difficult environment in which to work, and in which to build resilience.

Q194 Hugh Bayley: Thank you. That is a very helpful answer. Do any of your advisers want to say more on what the Department is doing on adaptation?

Professor Wheeler: From where you started off, the answer is clearly that you have to carry out actions to address both adaptation and mitigation. I think that is important for the agricultural sector, because, as I am sure the Committee is aware, the agricultural sector is a considerable contributor to greenhouse gas emissions, as well as these potential impacts that you led off with. In a sense, that provides us with a potential winwin situation for interventions within agriculture.

The biggest policy programme addressing that is with IFAD, whom I believe you saw in an earlier evidence session, and this ASAP programme, which is a large programme to try to provide or incentivise more climatesmart practices for smallholder farmers across a whole range of countries. There is a pressure point there: you can work on building resilience, building better adaptation, but also potentially linking in to a reduction to greenhouse gas emissions, albeit in a small way, but still addressing some of the mitigation concerns as well.

Q195 Fiona Bruce: You have talked positively about the social protection programme, and certainly the work in Ethiopia seems to be positive. We are interested to know that whilst you have 28 bilateral programmes, in your written evidence you say that you plan to fund social protection only in 17 countries. Why is this?

Lynne Featherstone: I expect it is a work in progress. It is about doing things as you can, where you can, and where that is the most effective way of enabling families and communities to deal with the shocks they endure. I do not know if anyone has a more detailed answer than that, on why we are not working in the other countries at the moment. As I say, it is relatively new, social protection, and we are virtually doubling the countries in which we are able to extend the social protection programmes.

Dr Dick: On the ground, it may be that the Government of that country, for example, judges that others are already intervening and they do not need DFID to intervene, or that others are better placed than us. As we are growing the amount of contribution we make globally, we will be looking at where it makes more sense for us to intervene.

Q196 Fiona Bruce: Leading on from there, on the issue of targeting, do you have a comment? I know there are some who take the view that targeting the poorest is the most efficient, but there are others who say that where everyone is poor, or the vast majority are poor, targeting is perhaps not the most efficient way to go about social protection.

Lynne Featherstone: There are so many poor and the needs are so huge that it is very invidious, but I do think targeting is an important part of some of it. I went to visit a social protection programme-I think that one was also in Zambia-and the targeting was on the most vulnerable. It was not just the poorest, but, say, people with disabilities. Disability is as yet quite underattended to, in my view.

Fiona Bruce: Yes, it is.

Lynne Featherstone: I am working on it. I visited this woman. They had community activists who had selected the people who would be eligible for the social protection. This woman was disabled, she had five children, and with what I think was £2 per fortnight she was able to keep her children in school, buy a couple of chickens and some pots and have a little bit of a hard standing. She was able to do an amazing amount. I think it is a phenomenal investment. I am quite a fan of targeting, because everyone needs, but within that need there is even more need.

Q197 Richard Burden: I think we understand that there will always be a judgment about where DFID directly funds social protection programmes, and where it is best placed to do it compared with other players and partners. My question is really about learning lessons about what works and what does not work, how that evidence is gathered and how it is promulgated. We were in Ethiopia recently, as indeed you were, and saw some quite imaginative social protection programmes around the Productive Safety Net Programme. There were criticisms of it as well in some quarters, but there are certainly things about that programme that are interesting and may well be effective in that context.

There are also other things going on in other places. You talked about Zambia, but there are places where DFID does not operate. I am particularly thinking about South America, where DFID, for really good reasons, does not have programmes itself, but there is all sorts of creative thinking going on around these areas. How do we pick up on those things? How do we assess them, whether or not we are involved? How do we use our work with multilaterals, who often will be involved in those things even if we are not bilaterally, and how is that pulled together in DFID to influence policy and practice?

Lynne Featherstone: I would expect my officials to be advised of everything that is going on in the world, at all times.

Q198 Richard Burden: That is a good ministerial objective, but how does it happen?

Professor Dercon: This is an excellent question. As I am sure you aware, DFID has in recent years been upping the spend on evaluation in a big way, embedding evaluation within our own actions but also in the way that we spend on research, with a strong evaluative element on it, to try to find out what works. On the examples of social protection, which I know quite well, given that I am a researcher working on Ethiopia and have done some of the evaluations on the PSNP, that funding came in fact via DFID via other mechanisms.

This is something with our research programmes, either directly or via multilaterals, that we are funding a great deal of. We are funding, for example, in the World Bank several big impact evaluations, essentially also on these kinds of things, not just in the focus countries alone, so that we can also learn from all these lessons. I would say there is both a huge amount of investment, and also, within the research and evidence division, a huge amount of learning taking place, absorbing what we get out of that. If I may, you asked earlier also about infrastructure, it is in exactly the same way that we are trying to fund serious research to get a much better sense of what works almost anywhere, and trying to get the lessons out of it for the places we work.

This is work in progress, but I think we have made huge strides in embedding these lessons in terms of what works. If people have to do new business cases, particularly investments in social protection, we expect them to take a comprehensive look at the evidence base around social protection, the impact evaluations around the world, and what lessons are there to be drawn from it-not to pick and choose examples that suit the particular case, but to take a comprehensive look at it. It is embedded within the processes, and it is one of the criteria that are used to assess whether a business case can go forward in another country and another type of state.

Q199 Richard Burden: If there is a lot of research going on that is really good, but can you give three examples from all that evaluation about what works? I do not mean specific programmes, but things that work, which you are looking for and you would like to promote, around social protection programmes.

Professor Dercon: Social protection is an area that has probably been more influenced by the evidence base gathered in this way than almost anything. The basic example is that we have learned a great deal from the Mexican programme, Progresa, which was an extremely carefully evaluated programme early on, with controlled trials and everything involved in it. We can definitely argue that the evidence base gathered from the experience of the Mexican social protection programmes has influenced a great deal that has been happening in conditional cash transfers all around the world.

The second one I would say is the Productive Safety Net Programme. That, rightly, is a very impressive programme. Just the scale that a country as poor as Ethiopia can achieve with such a programme, that it can have not just a pilot and a few hundred thousand people covered but actually millions and millions and millions of people covered in a country, is definitely something that impact evaluations showed that, while it has a mixed impact on some things, on a number of things it is really very positive, and also on the system, so that we can actually learn and promote it. It depends on whether countries want to adopt these things or not: that is another matter.

I suppose another thing from evidence-if we go a bit longer back-is that ultimately the evidence from the Maharashtra Rural Employment Guarantee Schemes in the early 1970s I think, has been crucial in building up the understanding that public works programmes can work, and has helped to get us thinking about it as a good humanitarian response in that respect. I am sure there are other examples.

Chair: As I think you know and Richard Burden knows, the Committee is in fact going to South America partly to look at how these things work. We will talk to the World Bank, the InterAmerican Bank and also Brazilian agencies and NGOs. I think the point that Mr Burden is making is that there are a lot of good things going on, but we have no bilateral arrangement there. You have indicated that you have picked up on some things, but is there a better way of ensuring that we are part of that process? I hope our report can contribute constructively to that.

Q200 Hugh Bayley: One of the ways to reduce risks for smallholders is to encourage private companies to offer them guaranteed prices. We were told of the example of SABMiller providing smallholders in Uganda with guaranteed prices for sorghum. What can DFID do to encourage this, and to encourage private companies to guarantee prices for small producers?

Lynne Featherstone: We think, as I said, that in terms of hunger and nutrition the main problem is poverty, and the way out of poverty is private sector involvement. In terms of, as we said, smallholders being a vast part of the answer, much of the work we do is about supporting their entrepreneurial efforts. I described Zambia Sugar; I do not think they guaranteed prices, but they guaranteed to buy it, and I am not sure that those two are absolutely synonymous. To be honest, I don't know what we do in particular programmes to support actual guaranteed prices. I do not know if you know, Stefan.

Professor Dercon: I could add that it is not that we have a whole programme across the world where we want to encourage the private sector to start guaranteeing prices. The fact that they do this is the outcome of another process, which is this company investing within the value chain, but recognising that smallholders are a useful part of their value chain, and building up longterm relationships with them. Price guarantees could be something, or it could be quotas, where they guarantee to take on some part of the crop, and so on. It is this kind of interconnectivity. It is also something within our private sector department that we are looking into-challenge funds, good ideas to try to catalyse investment in that kind of arrangement.

Q201 Hugh Bayley: Where would you do that? Would it be a team at DFID headquarters who talk to the corporate boards at Nestlé, shall we say? Or would it be done at a country level?

Lynne Featherstone: I know that we facilitate contract farming agreements by providing finance inputs and guaranteed markets for smallholder produce. I will have to write to you about the mechanism by which we do that, but that is one of the strands of the very many things we do in terms of trying to support the whole of the value chain.

Q202 Hugh Bayley: One further question on guaranteed prices. We were talking about the private sector, but what role does the public sector, through Government marketing boards, have in guaranteeing prices? I know when we were in Zambia we saw an example of this, which we felt was not particularly helpful: the Zambian Government guaranteed a fairly high maize price to the producers of the crop.

Lynne Featherstone: That was not helpful. That was a bit of a problem.

Hugh Bayley: It cost the Government a lot of money, which of course was an opportunity cost; the money could have gone elsewhere. Is that one example of a bad marketing board arrangement, and should one be looking at marketing boards providing, through a better managed or better conceived scheme, price guarantees to small farmers?

Lynne Featherstone: The thinking is sound, but different Governments have a different approach to things. I had the same experience you had in Zambia. I was there at the time, and the ask from the British Government was not to raise the price of maize, because it was incredibly damaging to smallholders, but I don't think at this point in time we have a concerted programme across all Governments. There are a number of Africanled development programmes, but I have not actually heard-do you want to intervene? Have I just not heard of it, or does it not exist?

Professor Dercon: No, I think there are good reasons why you have not heard of it, because I don't think it is something we do systematically. If you go back, what you have seen in Zambia was of course commonplace throughout the 1980s and early 1990s almost everywhere. The inefficiencies of these kinds of systems were quite well documented. It is something we touched upon earlier: we think a better entry point is getting the markets to work better, getting a better, clearer price transmission to make sure that you do not get the prices collapsing in one region while in others they are still high.

You have seen the Commodity Exchange in Ethiopia functioning; ideas like that, the mobile phonetype of interventions, are probably the entry point where we would go. We would also encourage Governments to build the infrastructure to get much better price transmission and functioning of these markets to take place. There is a role there, as you have seen in Ethiopia, for Governments to play.

Q203 Hugh Bayley: On a related topic, we have received conflicting evidence about the value of food stocks, with the OECD and, a couple of years ago, the World Bank, saying to us that there is a role for having food stocks, but really it is a matter of prepositioning in areas of food insecurity, such as the Horn of Africa. However, more people are now saying that this is a sensible way to control food price volatility. Where does DFID stand in this argument?

Lynne Featherstone: So far my connection in terms of food stocks has been in the instance of food insecurity. It was in Malawi, in fact, where the President, Joyce Banda, was saying that they thought they had stocks, but actually their stockkeeping was so poor that they did not have the stocks they thought they had, which further damaged the position. I have not heard of discussions about food stocks outside of a food security situation, but I hand over to Stefan to see if he does.

Professor Dercon: Where you get conflicting evidence, those people are not always very clear what they are really talking about. There is a key part of food stocks that is generally accepted: for national food security purposes, it makes sense to have some kind of stock that, say, would cover three or four months or something of essential supplies in particular areas, for humanitarian responses when sudden spikes happen-when the ship does not arrive, this kind of thing. We know this very well, not least in humanitarian situations but actually more in general: these disruptions can happen, especially for small and landlocked economies, say, in Africa.

Q204 Hugh Bayley: Aren’t the size of the stocks, the number of days’ supply retained in stocks, reducing at the moment?

Professor Dercon: There is that. That is another part of the evidence base, and it is probably something where we could do with a bit more transparency as well, because sometimes the data-not least, say, for countries like China-are highly disputed. In fact, we worry that some of the 20072008 peaks were caused by wrong information about Chinese stocks, as some people have argued. More recently, stocks had declined towards last summer, and that was causing the temporary worry. My latest understanding, but we can check this, is that it is not as bad anymore. They have definitely recovered to some extent, compared to where they were before the food crisis.

These things matter, and we should not underestimate them: if food prices are very high, keeping stocks is a very costly activity. This is also why, in terms of advice, we have to be very careful about the opportunity cost and whether encouraging countries into getting futures contracts, guaranteed supplies contracts and so on, may well be better alternative mechanisms. I would say the evidence base here makes it very difficult to say what the right response is for each country.

Q205 Hugh Bayley: In a sense, though, that is the problem, is it not? If food stocks damp down prices, or at least damp down price volatility, it may well be a very good way to spend money. I think what you are saying is that the economists are looking at this, but frankly the evidence is not strong enough. What more can you do to strengthen the evidence base, and work out where and how big a stock you ought to keep?

Professor Dercon: It is something that personally I have had close contacts with people in the World Bank researching it, and also colleagues at DEFRA. We want to get a much better take on food markets, on the functioning of international food markets, the way it feeds into price and the price transmission into countries. It is definitely one topic that we are actively talking about in terms of whether we can really up the evidence base. There is probably a recognition that before the food crisis, we had not really kept up properly with the evidence base in that kind of area.

Q206 Hugh Bayley: There certainly seems to be a consensus that as a prepositioning tool food stocks are valuable, and I would say that if you have a food stock in a highly vulnerable area, that will have the economic effect of damping down volatility in prices simply because it is there. To the extent that you do retain food stocks, who should be holding and running the stock? Should it be the Government of the country concerned, or should it be an international agency like the World Food Programme or the Bank?

Professor Dercon: When you come to say that it should be a multilateral agency doing it, we are arguably probably talking much more about more humanitarian responses and being released for that kind of purpose. There, the general take that people would always take is that if a country can manage its own stocks, it would obviously give it much more ownership and embed it in its own policies, and it would be a bit strange not to take that approach. If it is really about trying to influence the markets, I would say that it is a much trickier proposition. I could probably give you an answer, country by country, region by region, and I would be very cautious about generalising that we should be doing this and that, it should be on a large scale, and so on. I think it could be a very difficult and costly thing to do. I will give you an answer: probably we do not know very well how best to do that.

Q207 Chair: The World Food Programme is pursuing its alternative strategy, which is contracting to buy from farmers within the regions in which it operates, their Purchase for Progress scheme. When we were in Ethiopia we were told that they had signed forward delivery contracts valued at $12.3 million with 16 cooperatives, with 500,000 members. What they were obviously getting was reliability, which enabled them in turn to get bank loans to fund planting and so on. This scheme is operating in 20 countries. I have just checked the list, and I think 13 of them are countries in which DFID has a bilateral programme and DFID does fund it. The question is: is there more scope for that? Perhaps not surprisingly, when we asked the WFP what they thought-

Lynne Featherstone: They said yes.

Chair: The quote we have from the Executive Director was-and I remember her saying this-that she would scale up the scheme "in a heartbeat" if the donors would make the funds available. To be fair, they have made this point consistently over quite a number of years. There seems to be a difference of view as to what the role of the WFP is, but they seem to me to demonstrate that they have a mechanism that does two things: it gives farmers sustainable income, which is a development benefit, as well as giving them access to food within a region, which they can use when there is a crisis. It seems to be a winwin situation. DFID does support it, but the question is, is there more scope for doing more?

Lynne Featherstone: Should we do more? I think, Chair, there is not an issue you have raised today on which we could not do more. Everything needs scaling up; all of the programmes could do with more. I have visited one of the World Food Programme’s projects such as you are saying, in Darfur. It is an amazing project, and I will look more closely at it and at the issue you have raised, because it does seem to have a double benefit.

Q208 Chair: I would really appreciate it. I repeat the point: it is really good when you have an organisation whose overriding function, if you like, is to deal with a crisis, but that can do it in a way that provides sustainable development as well as addressing the crisis.

Lynne Featherstone: That is why I am agreeing with you.

Q209 Chair: If I may say so-this is a slightly tangential point-this was also a debate within the EU about the Sahel, where I understand that the two different Commissioners ultimately negotiated a deal where some of the money that was going into shortterm relief would actually be channelled in a way that might help some of the longterm supply problems.

Lynne Featherstone: DFID’s position on the Sahel is very much to think in the longer term. I have just this week been talking to counterparts across the donor Governments to try to promote that attitude in terms of a longerterm approach to sustainability, really. Otherwise we will be there forever.

Q210 Chair: Thank you for that. I take note of what you have said. In terms of timing, obviously we are ongoing, but if you feel able to tell us anything in advance of our Report-you could probably already read the recommendations in your mind-

Lynne Featherstone: I cannot tell you anything in advance. What I am saying is that I was so impressed myself with what the World Food Programme were doing in Darfur, which has to be one of the most difficult circumstances in which to deliver all of the things they were delivering. It was quite remarkable, in the circumstances, to see a community being able to sustain itself, as well as grow some cash crops and a whole range of things. All I can undertake to do is to look at it closely.

Chair: Thank you very much for that. Thank you to all of your team for coming along. I think we have probably covered most of the things you would have anticipated, I hope reasonably systematically. We appreciate your answers, and it has been helpful to have the officials that are working with it giving evidence to us at the same time. I think it strengthens and deepens the value of the exchange.

Lynne Featherstone: I agree with you. I think you are a very wise Committee to do that.

Chair: We’ll have a private conversation about that, which I will not put on the record. Thank you very much. I very much appreciate it.

Lynne Featherstone: Thank you.