Mr Heath: I did hear that complaint and I must say that what was coming into our ports from outside the EU was a great concern of mine. I do not think sufficient

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precautions were in place, although they have improved since. Within the EU, although there were theoretical paper trails, when they were examined in the context of the horsemeat scandal they were found to be relatively easy to falsify. That cannot be acceptable and we need co-operation on that between member states.

The paramount responsibility of the Food Standards Agency and of Government is to maintain the safety of food. I do not want anything to be done in terms of the composition that takes away from the primary responsibility of ensuring that when consumers eat something, they are safe from infection or poisoning. That is not to say that composition is unimportant. It gives consumers something other than what they think they have bought. As we have heard, for some communities that is of very great significance, particularly those that have religious requirements about what they eat, but everybody is entitled to be sold what they think they are buying according to the label that the product bears. If people are deliberately setting out to sell something other than that, there is a very simple word for it, and that is fraud. The title of today’s debate is “Food Fraud” and the significant point is the fraud, not the food. It is a crime, and one that needs to be treated as serious. We need the apparatus to ensure that we interdict when it comes into the country and that we ensure prosecution when people involved are in this country.

Miss McIntosh: I am following my hon. Friend’s elegant words very closely indeed. The Secretary of State when he was the Minister responsible for farms and food, my right hon. Friend the Member for North Shropshire (Mr Paterson), promised that the perpetrators of this crime would be brought to book. It must be a source of great disappointment and regret to my hon. Friend, as it is to me, that no convictions or successful prosecutions have been brought.

Mr Heath: I find it enormously frustrating because, frankly, the then Secretary of State and I did absolutely everything we could to mobilise and energise enforcement agencies across Europe to try to ensure that the problem was traced. I can say now because I am free to do so—the Minister may feel more constrained—that I believe that at the root of this was large-scale, European-based organised crime and that more could and should have been done by other member states to get the bottom of it.

It was a very convoluted story—we know that—and it was not easy, but I felt that having raised the issue very effectively in European Council meetings, obtained the involvement of the Commission and persuaded other member states to take it seriously, there was a palpable feeling once the press and media furore had died down that some member states were suggesting, “Let’s not push it too hard, shall we, chaps? Let’s not remind people that we had a problem and let’s just hope it all goes away.” I do not think that is good enough. I do not think that the UK Government took that view, but I am not convinced that others did not feel that once the storm had passed, it was easier simply to carry on as before. The trouble is that that meant that those people who were making an awful lot of money—we are talking about huge sums across a European nexus—continued to do so, which means that the problem will arise again.

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We in this country and manufacturers and retailers across Europe made the situation worse because of the complexity of the supply chain. That has been mentioned time and again, and the more we looked into it, the more extraordinary seemed the number of different hands that some of these products went through across so many jurisdictions in Europe. One only had to look at the price of the finished product and the number of people who were supposedly making a profit to realise that that could not possibly be done in a legal way. Some of our big retailers, which have very sophisticated procurement offices, perhaps had some responsibility to ask more questions. They do now, but they should have been asking at an earlier stage about how so-called beef could travel all the way around Europe only to be sold as eight burgers for less than £1 on a British supermarket shelf. It could not be done legally.

Huw Irranca-Davies: The hon. Gentleman is making a fantastic contribution to the debate. Does he agree that one of the strongest recommendations in Elliott is that part of the due diligence, for want of another term, from here on must be that when those in the supply chain see an offer that is too good to be true, they must ask why. When horsemeat was being sold at a quarter the price of good beef, anybody looking at it should have asked what on earth was going on.

Mr Heath: They should indeed. People should also be aware—the hon. Member for Tiverton and Honiton (Neil Parish) made this point in an intervention—that the more price wars we have in our supermarkets, the more dangerous it is for good, honest suppliers, and the greater the propensity for those in the middle to try to scrape an extra margin through unfair practice. That is why I worry when our major retailers engage in food price wars, because although it may seem that that is in the interests of consumers of modest means, it is not, because those people are just as entitled to get good-quality produce for the money they spend as those paying much higher prices.

Although they are beginning to do this, retailers need to raise the status and increase the independence of those they employ to carry out testing throughout the supply chain. That will mean that if the testers suspect that something is wrong, they can say, “This has to be looked at,” and the matter will be considered at board level so that appropriate action can be taken. I do not want to start a hare running or to suggest that something very wrong is happening in the catering industry, but I worry that the quality of products that sometimes find their way into catering establishments is not as high as those sold on retail supermarket shelves.

The Food Standards Agency has a crucial role to play, but one of the difficulties that I faced as a Minister—the current Minister will face the same situation—was that I had no responsibility for the agency, so I had to answer questions in the House that were strictly speaking nothing to do with me, in the sense that the FSA had an independent role. The distinction is important, because the food industry’s sponsoring Minister should not also be its regulator, and we saw many years ago that if that happens, the public lose confidence in the regulator. However, it is important that there is the greatest possible co-ordination between DEFRA and the FSA. We had

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that, and I pay tribute to the agency and its officers for the work that they did with me and for their help, which I appreciated. It is important that such co-ordination take place at a high level.

I worry that local authorities do not always play their part. We need a comprehensive local authority testing system. Some local authorities are very good, but others, frankly, are not. It is easy for anyone to say, “Oh, it’s about resources,” but there is no direct correlation between the resources available and whether an authority does a good or bad job. It is more a case of whether an authority recognises that it has an essential and primary responsibility to keep people in its area safe. Just as central Government have a responsibility, so does local government, so local authorities need to carry out testing. There is a question about the laboratory service—the recommendations on the laboratory and public analysis services are crucial aspects of the package—but I do not accept that local authorities should be let off the hook if they say, “This is a low-priority area and we want to spend our money elsewhere. It’s all the Government’s fault.” That is not the case, and local authorities must recognise their responsibilities.

Jim Fitzpatrick: I take the hon. Gentleman’s point that resourcing is no guarantee of local authorities providing good services, because there are some very good authorities and others that are not so good. The practice of various local authorities shows that this is not a party political issue either. However, one of the Elliott report’s main recommendations is that there should be an examination of what is happening in local authorities so that we can identify the good guys and those who are not doing such a good job, find out what is best practice and how it can be achieved, and then share that information.

Mr Heath: I entirely agree, although I suspect that the Food Standards Agency knows an awful lot of that information already because it works directly with local authorities from day to day and will know of the results it receives from local authority analysts.

We must not set out rigid structures for the FSA that impose testing regimes for no benefit. The system must be based on intelligence and proportionality. Earned recognition, if appropriate, is an important way of redirecting resources effectively but, as Professor Elliott says, that must be coupled with spot checks to ensure that what one thinks is going on is actually going on. Nevertheless, it would be foolish to redirect FSA resources, which are always under pressure owing to the extent of its responsibilities, to testing that serves no useful purpose.

I understand exactly what Professor Elliott says about the concept of a food crime unit, but I have a concern. Food crime and fraud cover a wide spectrum of offences, ranging from low-scale inadvertence and very minor adulteration—frankly, it is not difficult to pick up and prosecute such practice, and it should be well within local authority or FSA officials’ power to take appropriate action to deal with it—to the large-scale fraud that the horsemeat scandal revealed, which I think is based on organised crime. Such fraud might require action at a much higher level, such as through the National Crime Agency, and to deal with that sort of organised crime, we need a sophisticated approach and co-operation with counterparts throughout the world, such as Interpol

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and Europol. I worry that if we are not careful, the food crime unit could fall betwixt and between those two ends of the spectrum, and we might have something that is ineffective at dealing with the big guys, but over-designed for the little guys. The Government need to give serious thought to the terms of reference and composition of the food crime unit, as well as to how it reports and feeds into the gangbusters in the NCA.

The one thing that worried me enormously when I was a DEFRA Minister—it still worries me enormously, and I think it will worry me more and more—was the resilience of the Department itself. DEFRA is a good Department. It does an awful lot of good work and has to cover a huge number of contingencies, but its funding and resources are now such that it would find it difficult to deal with a major incident. I hope that the Treasury and leaders in government recognise that if we have a major incident to which DEFRA is unable to respond, the consequences could be enormously damaging. I am not saying that we are at that point yet, but we must be cautious that we ensure that we do not stretch what is already a thin line—a thin blue line, red line or whatever; let us think of a colour—

Huw Irranca-Davies: Green.

Mr Heath: I am grateful to the hon. Gentleman for coming up with a suitable colour on the spectrum. We must not stretch the thin green line so taut that we are unable to deal with an act of God, or an act of wicked men, that might cause our nation enormous problems, but I just feel that we are getting close to that edge.

7.29 pm

Julian Sturdy (York Outer) (Con): I apologise for missing the opening few remarks in this important debate, and I warmly congratulate the hon. Member for Brecon and Radnorshire (Roger Williams) on securing it. It is a privilege to follow the hon. Member for Somerton and Frome (Mr Heath).

I draw Members’ attention to my declaration of interests. As a proud Yorkshire farmer who supplies genuine Maris Piper potatoes to a well-known Canadian French fry producer with a factory in Scarborough, based in Yorkshire, I could not pass up the opportunity to say a few words in this important debate.

It is reassuring that Professor Elliott has commended the British food industry so highly for providing one of the safest food supply markets in the world. The report acknowledges the importance of developing shorter supply chains and securing domestically produced food for a more resilient food network. Indeed, I hope that hon. Members in all parts of the House will join me in recognising the hard work of British farmers, who have invested to provide us with such high-quality produce. We must do all we can to strengthen our nation’s food security, increase investment and maintain our international reputation for producing the finest quality produce anywhere in the world.

As has been made abundantly clear, however, the problem is increasingly complex retail supply chains, which can make accurate tracing of food all but impossible. According to the Irish Department of Agriculture, Food and the Marine, the factory that supplied a British supermarket with burgers made up with 30% horsemeat sourced the ingredients from 40 different suppliers. In such a long, complicated and unaccountable supply

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chain, the opportunity for fraud is sadly all too clear. Having familiarised myself with Professor Elliott’s excellent report, I agree entirely with the emphasis he places on the eight identified pillars of food integrity. It is, however, essential that we do not overlook the most effective way of ensuring the integrity and assuring the quality of our food: buying British produce.

Zac Goldsmith: On supporting British food and farming, does my hon. Friend celebrate as I do recent moves by DEFRA to encourage much greater use of the £2 billion or so we spend each year on food for schools, hospitals, military barracks and the like on domestic produce, so that a far greater volume of funds will be used to source and access good-quality local food for our children, patients and so on than was the case before?

Julian Sturdy: I entirely agree with my hon. Friend, who makes the point well. It is important that the Government, of which DEFRA is one Department, lead by example, and I feel that they are doing that.

In the wake of the horsemeat scandal, it was clear that consumers want to see more British food on the shelves of supermarkets. They want to buy more British food and eat more British food, whether they get it through schools and hospitals, or by buying it in their local supermarket and from local producers. Buying British food is important, because animal welfare in our country is second to none. Our farmers are rightly proud of their world-beating record, which sets us apart from other global producers. We must celebrate that. For me, that is a gold standard, which we have to maintain.

I draw the House’s attention to the fantastic but often overlooked red tractor assurance scheme, which was mentioned by the hon. Member for Poplar and Limehouse (Jim Fitzpatrick). The logo, with the Union flag, shows not only that the food was produced in the UK, but that the highest standards of animal welfare, food safety, traceability and environmental management have been rigorously enforced. Almost 90,000 farmers now take part in the scheme, and the retail value of food carrying the logo is now estimated to be more than £12 billion a year. Next week is red tractor week, and I urge everyone to support the scheme where possible. Young people are being asked to become red tractor recruits, to spread the word of high-quality British produce on social media. Sadly, I can no longer claim to be a young person, nor have I ever been an avid tweeter, unlike some other Members, but I hope my contribution will convince some consumers to put British produce into their shopping basket—or to buy local, which we have not touched on yet—

Miss McIntosh: Yes we have.

Julian Sturdy: I do apologise—buying local has been talked about already, but it is worth mentioning again. The best form of traceability and quality assurance is to go down to the local butcher, greengrocer or fishmonger and buy local. When we buy local, we know where the food has come from—we can ask the butcher where the meat has come from, even down to the individual farm.

The importance of farming to our economy should not be underestimated. Food production and farming contributes almost £100 billion to the British economy

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each year, employing almost 4 million people in the process. We can be proud that farming remains a family affair, with 90% of the more than 140,000 registered farming businesses run as sole traders or family partnerships. Food and drink products are now the country’s fourth largest export sector, with sales booming by about 5% a year. Indeed, some of the UK’s most lucrative exports are now from the farming sector, with lamb exports up 8% year on year, cheese exports up 9% and dairy produce up an incredible 18%. Such successes play an important part in creating jobs and fuelling our economic recovery and must be encouraged to continue.

We must also take the necessary steps to safeguard our hard-won reputation of excellence, which could easily be jeopardised by rogue elements operating in an increasingly complex international marketplace. Professor Elliott rightly calls for a zero tolerance approach as one of the pillars of food integrity. I understand that, at the request of the Food Standards Agency, the Sentencing Council is considering whether there is an opportunity to provide fresh guidance on food and hygiene offences. I urge that tough sanctions be brought to bear on anyone who would not only jeopardise the health of British consumers, but cheapen the reputation of the agricultural industry, which farmers have worked so hard to rebuild after the scares of the 1990s.

I welcome the Secretary of State’s response to the report, which recognises not only the value of British farming, but the importance of educating children about quality food. Cookery and food education will be a vital part of the national curriculum, and young children will now enjoy a much better understanding, not only of where their food comes from, but of why it is so important to eat fresh and healthy produce.

I could not let this debate pass without mentioning food security, as it remains a fundamental concern across the country. We are only 68% self-sufficient in food—a level that has, sadly, steadily declined over the past 20 years. Well meaning but poorly implemented schemes such as the common agricultural policy have limited our ability to increase food production in a sustainable way. Our competitive edge in quality and our capacity to increase yields can be promoted only through better understanding of the farming sector and investments in new technology.

It is all too easy to forget that the industrial revolution began with a revolution in Britain’s farming practices, transforming our island nation into the world’s foremost power for more than a century. With such a proud heritage we must remain focused on increasing yields, boosting exports and safeguarding our gold standards in quality produce and animal welfare.

7.39 pm

Huw Irranca-Davies (Ogmore) (Lab): I congratulate all right hon. and hon. Members who have contributed. We may be few in number, but we have had a very insightful debate with a lot of quality in the speeches, with more to come as well.

The hon. Member for Hexham (Guy Opperman), in response to an intervention, accused me of bringing politics into the debate—heaven forfend! That is my day job; I am a politician. I try to deal with evidence and rationality, but I am also elected democratically and I

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am a politician. If the hon. Gentleman, who is no longer in his place, does not understand that, I will happily sit down with him over a coffee.

I congratulate the hon. Member for Brecon and Radnorshire (Roger Williams) on introducing the debate. We go back a very long way. He talked about the 2001 election, which was delayed because of foot and mouth. I recall that well, because we were sparring partners, but he was also seeing daily, alongside farmers, the horror of the burning carcases. He has great experience in this area. He reminded us of the importance of Elliott, food fraud, food criminality, traceability and all the aspects of this to the farming community. As many hon. Members have said, those who are often hit really badly are the primary producers—farmers. It is they who get squeezed, whether in price wars or in burdens being laid on them. We need to guard against that.

The hon. Gentleman, like many others, strongly supports the proposals in the Elliott report. As hon. Members will know, I have spent my weekend poring over every line and word of it, as well as other briefings and so on. Professor Elliott makes it crystal clear that not only the eight pillars of food integrity but every detail must hold together. These proposals are not to be cherry-picked; equal effort must be put into every aspect.

During an intervention on the hon. Gentleman, we briefly discussed the FSA’s interim proposals, which some would argue have a different emphasis from the final report. However, it is about more than degrees of emphasis, because the Troop proposals mentioned by the hon. Member for Thirsk and Malton (Miss McIntosh), who chairs the EFRA Committee, among others, expressed a preference for putting these responsibilities into the FSA. Even though this is slightly modified in the report, Elliott makes it clear that if that is not going to be the case, he wants the matter to be pursued in a different way with equal rigour and clarity. Let us see how it emerges.

My hon. Friend the Member for Poplar and Limehouse (Jim Fitzpatrick) has great experience in these matters. I served alongside him when he was the Minister responsible for food, farming and agriculture. He brought a great deal of experience to bear, as he always does in these debates. He talked about not having the full impact of this falling on farming communities. He discussed, as did others, including the hon. Member for York Outer (Julian Sturdy), the importance of the red tractor assurance scheme. That is an important element of some of the briefings from the National Farmers Union, the Food and Drink Federation, and Which? magazine—I am sorry, not Which? magazine but Which? the consumers association. It used to be a magazine when I was a young man but now it is far more than that.

My hon. Friend said that Elliott is proposing not to increase burdens but to reduce the burdens on the good guys and put the burdens on to the bad guys and the criminals. He talked about the importance of a strategic laboratory service, which is crucial. He asked whether the resources were sufficient for this very wide-ranging set of proposals to do Elliott justice. He referred to the machinery of government changes in the FSA. Like many Members, he queried why prosecutions are so few and far between and often do not go after the big fish in the pond.

The hon. Member for Thirsk and Malton has a great deal of experience in this area. I commend not only her speech but the work that the EFRA Committee has

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done over time on putting a spotlight on to this issue with considerable detail and forensic analysis. She opened her remarks by paying tribute to a friend of all of us right across the House—the late Jim Dobbin. We are all very sad and our thoughts are with his family. One of his great causes related to DEFRA—open access and the right to roam. There is nothing more political than putting one foot in front of the other and walking out into the countryside. He was a great believer in that. In fact, I have a debate about such matters on Wednesday afternoon in Westminster Hall, and anybody who wants to can come and take part.

The hon. Lady talked about the desirability of shorter supply chains. A lot of the retailers have “got” that now, but we have to keep the pressure on. On the day of the National Farmers Union conference a year ago, one retailer—I will not name it for fear of embarrassment but it knows who it is—took out full-page adverts with a big banner headline saying, “We get it”, that talked about how it would transform its business. I have met it subsequently, and it is trying to do that. It is our biggest supermarket chain. A lot of farmers are now watching for it to carry that through relentlessly.

In an intervention on the hon. Member for Upper Bann (David Simpson), the hon. Lady talked about penalties, which the hon. Member for York Outer also mentioned. We need to consider not only what the Sentencing Council is doing, and stronger penalties, but broader penalties so that some of these cases do not have to end up in court. That could be to do with naming and shaming, but there might be McCrory-style types of penalties that deal in the right way with relatively minor offences early on and deal in a heavy-duty way with the big offenders as well.

It was asked whether more incidents have taken place post-horsemeat. It is interesting to refer to the very good House of Commons Library briefing, which draws on Elliott’s observation that in 2007 there were 49 reports of food fraud to the FSA’s food fraud database, while in 2013 it received 1,538 reports. According to the National Audit Office, local authorities reported 1,380 cases of food fraud in 2012, up by two thirds since 2010. That is the scale of what we are looking at. That emphasises the importance of local authority intelligence, which a few hon. Members mentioned, and of how this ties together. It will not all be carried out by serious crime people; local information on the ground will open it out.

Miss McIntosh: As I hope the hon. Gentleman will confirm, there is not sufficient intelligence. A lot of the testing is done purely on the basis of risk assessment. The key is not just the food crime unit but the fact that there will be spot checks—unannounced audits. Surely that has to be a good thing.

Huw Irranca-Davies: I could not agree more. I hope that the Minister will also say that that is the way forward. It is not only about routine checks or risk assessment-based checks but turning up unannounced.

The hon. Lady rightly made a point about Troop and the FSA leadership, and clarity of roles. She also talked about the police’s powers of arrest, and I will be interested in the Minister’s response to that.

The hon. Member for Somerton and Frome (Mr Heath), a former Minister in the Department who also has great experience, discussed the importance of cultural change,

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which is crucial. He rightly talked about the importance of driving this through every area, including catering. It has to go deep into every individual sector and employee as well as the bosses and the leadership. The importance of caterers was brought home in the horsemeat scandal, because horsemeat was appearing not only in hospitals and schools but in the food used by caterers who were supplying Royal Ascot and the royal family—so at least we were all in it together.

On the complexity of the supply chain, Elliott says that we have to recognise that, even though it is more desirable to have shorter supply chains and to encourage food retailers and providers to move towards them, we are in a global system, under which global intelligence and the pursuit of crime come into play. He also says, wisely, that ultimately the food price wars that take place from time to time, including now, are not good for the consumer if they jeopardise food authenticity or—heaven help us—food safety.

The hon. Member for York Outer spoke up strongly for British farming and food produce. He talked about the gold standard of British farming and I agree with him. Curiously, when we were on the Government Benches, others would shout at us about gold-plating, but that is exactly the gold standard he was talking about. That is the reason our exports to many other countries are doing well—they demand the standards of animal welfare, hygiene and testing that this country delivers. Regulation is a darn good thing when it protects the consumer and allows us to export around the world. Curiously, the FSA has traditionally been looked on as the gold standard of food regulation.

The hon. Gentleman also talked wisely about the importance of knowing where our food actually comes from. There is a great deal of work to do on that right across the population, ourselves included. There is real value in knowing where food comes from; it ties into so many good things.

The Labour party is very clear—as we were when we were in government—that the consumer has always to be put first. That is why, when in government, we established a strong and independent Food Standards Agency, which had a powerful reach right across Government to regulate this vital industry that creates so many jobs and that wants the very highest standards. However, the changes brought about by tinkering with the machinery of government have jeopardised that.

The Parliamentary Under-Secretary of State for Environment, Food and Rural Affairs (George Eustice): Professor Elliott says in his report that when the FSA had control of authenticity testing in 2007-08, under the previous Government, it took the decision, as an independent body, to cut spending on the testing programme. If the hon. Gentleman had been a Minister at the time and had received a submission recommending such a cut, would he have agreed with it or might he have questioned it?

Huw Irranca-Davies: I was not the Minister at the time, but I would like the hon. Gentleman to continue to make his point, because Professor Chris Elliott was unable to address the detail. Will he confirm whether authenticity testing continued even though it had been reduced?

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George Eustice: Yes, it continued, but the point Elliott makes is that the FSA, as an independent body, took the decision to start winding down authenticity testing.

Huw Irranca-Davies: Let me put it back to the hon. Gentleman: when the coalition Government entered office in 2010, one of their first decisions in DEFRA was to split away authenticity testing. At that point, did they think it was appropriate to increase investment in it? We could go back and forth on this issue, but authenticity testing was still happening at that time, even if it had been reduced. I am interested in the detail, but it was continuing.

Mr Heath: It is very important to distinguish between the testing regime that remains within the province of the FSA and local authorities, which continued according to their priorities, and the policy developed by civil servants, which was moved to DEFRA in order to inform Ministers who were having to deal with very complex European issues of labelling and composition. That was perfectly logical. If there was confusion, it was not at the level of central Government; it may have been elsewhere.

Huw Irranca-Davies: After the horsemeat scandal erupted in February 2013, the National Audit Office looked at the contributory factors to any delay or confusion. One of the things it pointed fairly and squarely at was the confusion about who was doing what. It pointed the finger at the machinery of government changes. The hon. Gentleman, who was a Minister, may be saying that he was not confused, but there was certainly confusion between local government and Whitehall, as well as within Whitehall, as to who was doing what. I agree with Troop and with Elliott’s interim findings that it should be put back together again, but we will have to differ on that. The question for the Government is: can they make this work if they are not going to do that?

One of our criticisms relates to the fact that just before we left government in 2010 we published what was at the time a ground-breaking, comprehensive food strategy, “Food 2030”, which followed on from our previous work on “Food Matters”. It mapped out a comprehensive and long-term strategy to ensure the provision of safe, nutritious, affordable and sustainable food, but it has been left on the shelf. Where is this Government’s overarching strategy to pull everything together? The answer is: there isn’t one.

Labour welcomes and supports fully all the Elliott report’s recommendations, and we will continue to urge the Government for full and speedy implementation. Professor Elliott sets out a new Government-industry partnership, some aspects of which will require a culture change in Government and in industry. He makes sound recommendations for a new food crime unit and a whole framework for national food crime prevention, encompassing Government, the FSA and industry. He calls for—it is interesting that he deals not just with the mechanics—a new mentality to meet the challenges of sourcing from complex international supply chains, and a zero-tolerance approach to food crime. He also fashions detailed proposals on whistleblowing, intelligence-gathering and co-ordinated laboratory and testing services, and stresses the need for leadership at all levels, including in

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Government. Most of all, he stresses—he puts this top and dead centre—the need to put the consumer first, and we agree.

Labour supports the report and all its recommendations. We believe that the industry is ready to drive the culture changes that Elliott demands and that the consumer and the public deserve. I say to the Minister, however, that we have reservations: we do not have the same confidence that the Government are serious about these changes.

Make no mistake: the Elliott report is not only a series of sound recommendations, but is an expert analysis and critique of the coalition Government’s policy on food governance and food crime. Since 2010 under this coalition Government we have seen the fragmentation of food governance; an ideological fetishism for stripping out regulation for the sake of it, whether that regulation is good for the consumer and industry or not; and front-line cutbacks in inspection at national and local level and in food-testing capabilities.

The Government have also been asleep at the wheel, reacting only when disaster happens, realising too late that cutting the brake cables and unscrewing the steering column was not a good idea. In 2010, one of this Government’s first actions was to split the responsibilities of the FSA, an agency that was, as I have said, previously regarded as the gold standard of consumer protection and industry regulation. It was deliberately fractured, which hampered clarity and leadership in food governance in the UK. It is not just me saying that; others are saying it, too.

The horsemeat scandal was the slow-motion car crash that showed how crazy that decision was. The NAO stated that when a prompt response was required to the breaking horsemeat scandal, there was confusion between, and lack of leadership in, Whitehall Departments and confusion between Whitehall and local government.

Similar, repeated concerns about the mishandling of the FSA and food governance have been raised for some time by the EFRA Committee and many other industry and food policy experts. Labour raised those concerns from the word go.

The interim Elliott report made it clear that the FSA responsibilities should be brought back together. That would deal with the NAO view that fragmentation had led to needless confusion and additional complexity. The final report has stepped back slightly, but it is still commendably forthright on the need to put rigour and reach back into the FSA.

On that and many other issues, the report carries implicit and sometimes explicit criticisms of this Government’s approach to food policy and food crime. It calls for a more robust FSA, retaining its independence, and for far greater co-ordination, which has been lacking, across government and industry. It highlights the absence of high-level round-table meetings between the chair of the FSA and the Secretaries of State for Health and for Environment, Food and Rural Affairs, which seems to me to be a shocking omission and a glaring fault bearing in mind the fragmentation of responsibilities since 2010.

The report cites evidence from recent local authority testing that appears to show high levels of failure, particularly in meat authenticity testing, which possibly indicates fraud or the criminal adulteration of food. That is deeply worrying when set against a near halving

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in the number of DEFRA officials working on food authenticity since 2010, as revealed by an answer given to me by the Minister in July. It is even more worrying in the light of the immense pressures on local authorities, which have led to severe cutbacks in local food inspections.

Professor Elliott does not pull any punches. He states on page 49 of his report:

“Enforcement activity is…very vulnerable when local authority services are cut to the bone.”

He also draws attention to the average 27% reduction in the number of trading standards officers dealing with food matters, and to the 40% cut in overall trading standards services during the lifetime of this Government. Concerns for consumer protection and for the reputation of the industry are heightened when, as Elliott notes, the number of public analyst laboratories has been reduced from 10 in 2010 to six today. I simply say to the Minister that he has his work cut out if he is to explain how, against the background of cuts in front-line FSA inspection, front-line local authority inspection and laboratory facilities, he can do what Elliott asks and put the consumer first.

Given that we are now four and a half years into this Government, the Minister must explain why the UK has been behind the curve and behind European counterparts in establishing a food crime unit. That led Elliott to note that the Dutch crime unit could find no one in the UK—whether in a crime unit or anywhere else—to speak to when the horsemeat scandal happened. Had the Government’s reluctance to place any burdens on industry given them an aversion to being proactive in such a way? Had Ministers looked at the threat of food adulteration and food crime since taking office? I understand that the Minister was not in office for the whole of that time, but I am sure that he has discussed it with his officials.

One month after the horsemeat scandal erupted, a survey by the consumer organisation Which? found that six in 10 shoppers had changed their shopping habits, and that trust had fallen by a quarter. A year after the scandal, an Ipsos MORI survey showed that 95% of consumers remembered the horsemeat scandal. As has already been mentioned, the latest polling by Which? has shown this month that 55% of people are worried that a food fraud incident will happen again, that a third of them do not have confidence that the food they buy contains what it says on the label—by the way, that goes up to half for people who have takeaways on a Saturday night—and a quarter maintain that they have changed the type of meat they buy. Seven out of 10 consumers have told Which? that more action needs to be taken. The damage is lasting, so we need to get this right.

Let me ask the Minister some initial questions; in the months to come, we will return with more. As the hon. Member for Thirsk and Malton suggested, will the Minister publish a detailed timetable for the implementation of every recommendation in the Elliott review so that the Government’s warm words can be measured against actual implementation? Will he give assurances that the resources for the new crime unit and the crime framework to go with it can be found from within existing FSA funding?

Will the Minister now apologise on behalf of the Government for the decision to fragment the responsibilities of the FSA, or does he continue to ignore the argument that that decision damaged its power, authority and

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independence? Does he accept the Elliott proposal that the FSA should continue as a non-ministerial department so as to retain its necessary independence from the Government? How does he answer critics who believe that the FSA has gone beyond the necessary close co-operation with the industry and is now too close to the industry to be a useful and critical friend? The recent decision not to publish campylobacter rates is one such example.

Bearing in mind the need for a more robust and rigorous FSA based on the report’s proposals and the need for the FSA to have the effective and independent leadership identified by the Elliott report, will the Minister give us an update on the search for a new chair? Will he confirm that the person shortly to be proposed as chair will appear before the Environment, Food and Rural Affairs Committee before final confirmation in post?

Miss McIntosh indicated assent.

Huw Irranca-Davies: They will, which is great.

What other foodstuffs are of primary concern for authenticity fraud, and which are on the priorities list for criminal activity at present? How will the Minister guarantee that the high number of authenticity failures can be identified now and in future against the backdrop of cuts in the front-line services involved in food authenticity? As so many hon. Members have asked, 18 months after the horsemeat scandal erupted, why have prosecutions been so few and far between? Does he share the public’s frustration that criminals appear to be getting away with messing with their food?

Elliott repeatedly argues for improved co-operation on an international and especially a European level to tackle food crime and fraud. Does the Minister expect us to believe that the Government’s general approach to European co-operation and the specific Tory proposals to opt out of 130 areas of European policing and justice measures will help the fight against international food crime? If so, has he done an impact assessment of those proposals? Will he support calls for an urgent review of criminal, financial and other penalties to toughen and widen the measures against rogues and criminals, and to protect the many good food businesses? Finally—for now—will he guarantee consumers and the industry that another horsemeat scandal or the like will not happen in the short time left of this Government?

Let me end by saying that this Government have their work cut out to persuade the industry and consumers that they are serious about tackling food crime and fraud because, as they say in police dramas, this Government have got “previous”. Their track record of delay and dither when facing a crisis, their ideological aversion to effective regulation and their wholesale absence of leadership and strategic thinking on food mean that they are in the dock as a serial offender. We urge the Government to get serious about food crime, food governance and food strategy. We will support them if they drive through all the recommendations with the rigour they deserve, because consumers and this vital UK industry deserve no less.

8.7 pm

The Parliamentary Under-Secretary of State for Environment, Food and Rural Affairs (George Eustice): I congratulate the hon. Member for Brecon and Radnorshire (Roger Williams) on securing the debate. He expressed some disappointment about the number of Members

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attending, but we have had a really substantive event; it does not take away from the gravity of the subject because the speeches made have really got to grips with the issues. Let me start by making it absolutely clear that food fraud is totally unacceptable: it is a crime, and this Government will not stand by while consumers are duped and deceived.

As my hon. Friend the Member for York Outer (Julian Sturdy) made very clear, food and drink manufacturing is important to this country. It is our largest manufacturing sector, a significant contributor to economic growth and a big employer. British food is renowned throughout the world for its quality, and our farming industry is world-renowned for our high animal welfare standards. The integrity of our food supply chain is essential for the great reputation of our exports, as well as for the confidence of consumers at home.

I want to say a little about the action that the Government and others have already taken since the horsemeat scandal broke at the beginning of last year. First, there has been robust testing of meat by industry and by the Government, with more than 50,000 tests of processed beef products carried out during that time, and I can say that no horsemeat was present in any of those 50,000 tests undertaken since the initial scandal at the beginning of last year. The Government have provided an additional £2 million of funding to local authorities for food sampling in the current financial year to help them carry out that vital consumer protection role.

We have commissioned additional sampling and testing for authenticity in response to intelligence that has been received. The hon. Member for Brecon and Radnorshire cited the example of lamb kebabs that did not contain as much lamb as they ought to have done. There has been comprehensive sampling of take-away meals to seek undeclared meat and undeclared allergens, which are another cause of concern. We have also instigated the development of new testing to ascertain provenance and country of origin, so that we can check that the country of origin that is stated on the label is correct and that those who claim that products come from the UK are being honest.

Finally on testing, we are developing and road-testing a new method to detect undeclared offal in processed meat products. The hon. Member for Ogmore (Huw Irranca-Davies) asked me what area we would look at next and where we think there might be additional problems. This is an area that we highlighted very early on. That is why we have been developing testing in the area.

At the end of last year, the FSA set up a new intelligence hub to collect, analyse and share information on emerging risks. We have also taken action to empower consumers to understand where their food comes from. That includes improved country of origin labelling requirements for products such as lamb and pork that have been set at an EU level, which take effect from April next year. The UK argued strongly for those changes. We are also improving the public procurement of food and catering services to provide schools and hospitals with high-quality British food.

A great deal has been done, but this debate has focused very much on the final report of Professor Christopher Elliot, which was published last Thursday. I want to say at the outset that the Government have

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accepted all Professor Elliott’s recommendations. As I said earlier, many of them are already being implemented. We will be taking forward other improvements that were recommended by him to ensure that consumers have absolute confidence in the food that they buy. I think that there can be a universal consensus around the House about the key point that Professor Elliott made: the consumer must come first.

Chief among Professor Elliott’s recommendations was the formation of a new food crime unit, based within the Food Standards Agency. That will build on the intelligence hub that was established in the FSA at the end of last year, but will add investigative powers. We have made a commitment to establish the unit and it will be fully operational by the end of the year. Initially, it will focus on building the intelligence and evidence picture of the risks and nature of food fraud in the UK.

It is important to note that Professor Elliott made it clear both in his interim report and his final report that the incentives for organised crime to get involved in food fraud are high. The hon. Member for Poplar and Limehouse (Jim Fitzpatrick) highlighted that in his contribution. Although Professor Elliott stated that he was unable to find any credible evidence of serious organised criminals operating in this area in the UK, he highlighted the serious risk of that happening, given the incentives. The Government are not at all complacent about that. If there is any evidence of criminality in our food supply chains, we are determined to find it and fight it.

A number of Members, including the hon. Member for Ogmore, highlighted the importance of whistleblowing. That is the subject of one of the main recommendations made by Professor Elliott. There is a concern that employees and others who have knowledge of food fraud do not feel that they have the right mechanism through which to alert people. The FSA has had a whistleblowing service, but it is fair to say that the awareness of it has not been sufficiently high. The FSA is looking seriously at steps that can be taken to increase people’s knowledge of the whistleblowing service. In addition, steps are being taken by the food industry to put in place similar measures to make it easier for whistleblowers to report wrongdoing.

Linked to that issue is the need for better intelligence gathering and sharing across Government and the industry to improve our ability to protect consumers. As a number of hon. Members said, Professor Elliott spoke about the need for a safe haven for industry so that businesses can share intelligence in a way that does not compromise commercially sensitive information. The FSA has made a commitment to improve its systems for dealing with sensitive information and to facilitate the kind of intelligence sharing and analysis for which Professor Elliott called. We will work with the industry to facilitate its development of a safe haven to contribute to that intelligence-sharing process.

A number of hon. Members, including the Chair of the Environment, Food and Rural Affairs Committee, my hon. Friend the Member for Thirsk and Malton (Miss McIntosh), and my hon. Friend the Member for Tiverton and Honiton (Neil Parish), talked about the importance of supply chain audits. That is another key theme throughout Professor Elliott’s report that we want to learn from. Professor Elliott highlighted the action that the food industry has already taken to assure the integrity of its supply chains and restore consumer confidence following the horsemeat fraud.

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Professor Elliott made a number of key recommendations for the industry on that issue. First, he said that there should be a shift of emphasis towards the use of unannounced audits and the use of sampling as part of the audit process to act as a deterrent. My hon. Friend the Member for Tiverton and Honiton made the point powerfully that we need to have unannounced audits if the audits are to be meaningful.

Secondly, Professor Elliott made an important point about duplication in the audit process. The hon. Member for Ogmore has talked about Government Members being negative about regulation. We believe in having regulation where it serves a purpose, but we should all share the hope that we can remove duplication. Professor Elliott made the point that a lot of retailers are doing similar audits, but with slight differences. There is a good case for the British Retail Consortium bringing its members together to review their audit standards and give consistency to their approach to audits so that there is a single industry audit system. He also called for the introduction of a new fraud module in the audit, which is incredibly important.

We must recognise what the industry has done to restore confidence in the food supply chain. I commend the work that the Food and Drink Federation has done to introduce a guide to help its members protect themselves against the risk of food fraud. My hon. Friend the Member for Thirsk and Malton referred to that. Although a number of hon. Members, notably the former Minister, the hon. Member for Somerton and Frome (Mr Heath), highlighted concerns about the catering industry, it is important to note the good work that is being done by the British Hospitality Association to engage small catering businesses on good practice in food authenticity, and its work with Whitbread to develop an audit standard for larger food service businesses. He is right to highlight the concern and there might be further difficulties in making progress on that front, but we welcome the work that the industry has done.

The shadow Minister spoke about the machinery of government. He asked why, after the interim report called for a change in the machinery of government, Professor Elliott seems to have stepped back slightly from that. Professor Elliott spells out the reason quite clearly on page 49, where he highlights the fact that representations were made to him regarding the machinery of government changes. He says:

“The review investigated this issue and was able to ascertain that the winding down of the FSA’s food authenticity programme was initiated prior to the machinery of government changes. While not attributing any blame for this decision, it was certainly not helpful”.

The final point he makes is that wherever the boundaries are drawn in the machinery of government, there will still be a need for different parts of the machinery to work together. That is why his ultimate conclusion is that wherever the boundaries are drawn, the most important priority is to have better co-ordination. That is exactly what we will deliver with the food crime unit.

The hon. Member for Poplar and Limehouse spoke about the vital role of local authorities, and around 2,500 trading standards officers provide an important part of our field force in that area. As he knows, we have made available an extra £2 million per year, and the Food Standards Agency runs training programmes for those 2,500 officers in the field. Local authorities

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have a legal responsibility to do that work under the Food Safety Act 1990, and a number of protocols and service agreements that the FSA has with local authorities set out exactly what is required, which is monitored centrally by the FSA. The hon. Gentleman is right to say that there could be a mixed picture, with some local authorities being better than others, but the FSA monitors them and holds them to their service agreements and requirements.

Jim Fitzpatrick: In my exchange with the hon. Member for Somerton and Frome (Mr Heath), I accepted that this issue is not necessarily about extra funding, and it is certainly not about party political control because there are good and bad local authorities. The hon. Gentleman said he believed that the FSA had information about which local authorities were good and which could perform better. Is the Minister personally examining that in discussions with the FSA or with ministerial colleagues in the Department for Communities and Local Government? Getting those local authorities to raise their game, whatever the reason, is an objective that I am sure the Minister holds. Will he reassure the House that he is considering that issue?

George Eustice: The FSA manages and monitors the work of local authorities, but one of Professor Elliott’s recommendations is that we should have a new committee on food integrity and food fraud. I will chair that committee, and it will be attended by my colleagues and a Minister from the Department of Health. We will discuss those issues and monitor the situation to which the hon. Gentleman alludes.

Let me mention some of the other points that Members have raised. Sanctions were mentioned, and it is important to note that the maximum penalty is already 10 years. Sentences are ultimately a matter for the courts and the Ministry of Justice, but 10 years is quite a significant sentence. A number of Members asked why we have been so slow to get prosecutions, but as many will know, the City of London police are leading the investigation. There have been five arrests and two prosecutions, which are currently going through the courts. Hon. Members will understand that it is not appropriate for me to comment on ongoing legal cases, but we should recognise that the City of London police have faced challenges as they have had to engage with many different police forces across the European Union to bring prosecutions together, which has taken some time.

My hon. Friend the Member for Thirsk and Malton raised the issue of labelling in the European Union. From April next year we will introduce improved country of origin labelling measures for pork, lamb and goat. In future—just as has been the case for beef for the last decade or so—pigs and sheep must be reared and slaughtered in the country that claims to be the country of origin. That is similar to the situation that pertains for beef production. On traceability, provisions have been in place for more than 12 years, and EC regulation 178/2002 requires all member states to establish a means of monitoring where the food has come from at every stage of production. That legal requirement is enforced by the FSA in this country and by other member states.

My hon. Friend made the good point—my hon. Friend the Member for York Outer also alluded to this—that however good the traceability and labelling

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systems in place, a long supply chain is not conducive to eliminating food fraud. It is important for retailers to look at their supply chains and try to shorten them. It is also encouraging that many consumers have taken more interest in where their food comes from, and we need both consumers and retailers to take a little more interest.

Miss McIntosh: I am grateful to the Minister for giving way because he did not have the chance to reply to this point last Thursday. Will the police have powers of arrest? We will not be rushed by future business, Madam Deputy Speaker. We need to know whether the police will have powers of arrest, and who will pick up the bill for the additional costs of the food crime unit.

George Eustice: The key point is that the new food crime unit will have investigative powers, and it is envisaged that people from the National Crime Agency in the police force will be seconded to that unit. As my hon. Friend knows, the police always have powers of arrest—indeed, they have arrested people in this current investigation. The new food crime unit will be properly linked to the police force so that it has those powers.

Finally, let me turn to lab capacity. Professor Elliott raises a specific concern about whether there is consistency between existing private labs and their approach to testing. As a result, we accept his recommendation and have asked the analytical methods working group—an advisory panel to the Government—to consider that issue and ensure consistency. We had no lack of lab capacity in the crisis last year. In fact, our excellent laboratories at the Food and Environment Research Agency in York were on stand-by if they were needed, although in the event they were not. Private labs like LCG, which I will visit tomorrow, led on most of that work. My hon. Friend also mentioned the Danish model and expressed a view—perhaps because she has Danish roots—that it is better than the Dutch model. When it comes to the food crime unit, it is difficult to compare the Danish or the Dutch model with what we have in the UK because we have some 2,500 trading standards officers in local authorities, who are an integral part of our protection in that area.

It is perhaps fitting to conclude where my hon. Friend the Member for York Outer ended his remarks, and with Professor Elliott’s conclusion that we have some of the safest food in the world. I completely agree with him that we should protect the reputation of our hard-working farmers. The Government have introduced a new Government procurement plan which, as my hon. Friend the Member for Richmond Park (Zac Goldsmith) pointed out, will encourage greater sourcing of local food. We are also working to encourage more schools to take a greater interest in and promote food and an appreciation of food in the curriculum. I thank all hon. Members for their contributions to the discussion. We have covered many detailed issues, and I again congratulate the hon. Member for Brecon and Radnorshire on securing the debate.

8.27 pm

Roger Williams: I voiced a slight concern at the beginning of the debate that I thought the seriousness and importance of the subject might be compromised by the small number of hon. Members present, but that

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concern has been confounded by the quality of the contributions made. I thank all Members who took part, including the hon. Member for Poplar and Limehouse (Jim Fitzpatrick), my hon. Friend the Member for Somerton and Frome (Mr Heath), the Chair of the Select Committee, the hon. Member for Thirsk and Malton (Miss McIntosh), and the hon. Member for York Outer (Julian Sturdy), for their contributions and a number of helpful interventions on the subject.

Professor Elliott set out eight pillars for the work that needs to be done. Paramount are the quality and reputation of British food and the rights of the consumer. I am sure that the House, the House’s Committees and Committees in the other place will take an interest in how the Government deliver on their commitment to accept all the report’s recommendations. We look forward to continuing that work.

Question put and agreed to.


That this House has considered food fraud.

Business without Debate

Delegated Legislation

Motion made, and Question put forthwith (Standing Order No. 118(6)),

Children and Young Persons

That the draft Children and Young Persons Act 2008 (Relevant Care Functions) (England) Regulations 2014, which were laid before this House on 24 June, be approved. —(John Penrose.)

Question agreed to.

Motion made, and Question put forthwith (Standing Order No. 118(6)),

Terms and Conditions of Employment

That the draft National Minimum Wage (Amendment) (No. 2) Regulations 2014, which were laid before this House on 30 June, be approved. —(John Penrose.)

Question agreed to.

European Documents

Motion made, and Question put forthwith (Standing Order No. 119(11)),

EU Industrial Policy

That this House takes note of European Union Documents No. 5489/14 and Addendum, a Commission Communication: For a European Industrial Renaissance, No. 13964/13 and Addenda 1 to 3, a Commission Staff Working Document: Member States’ Competitiveness Performance and Implementation of EU Industrial Policy, and No. 13966/13, a Commission Staff Working Document: European Competitiveness Report 2013: Towards knowledge driven reindustrialisation; and supports the Government in pressing the Commission to develop a roadmap for industrial competitiveness that focuses on open markets, competition, trade, better regulation and innovation. —(John Penrose.)

Question agreed to.


Madam Deputy Speaker (Dame Dawn Primarolo): With the leave of the House, I will take motions 9 to 11 together.

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That Mr Robert Buckland be discharged from the Justice Committee and John Howell be added.

Public Accounts

That Justin Tomlinson be discharged from the Public Accounts Committee and Stephen Phillips be added.

Work and Pensions

That Dame Angela Watkinson be discharged from the Work and Pensions Committee and Paul Maynard be added. —(Geoffrey Clifton-Brown, on behalf of the Committee of Selection.)

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International Mining Industry

Motion made, and Question proposed, That this House do now adjourn.—(John Penrose.)

8.29 pm

Eric Joyce (Falkirk) (Ind): We go from one important debate on a primary industry—farming—to another. I want to say a few words for the next short while on mining, a subject that gets too little attention in the UK. Like the shipping industry, we rely on mining for pretty much everything we use daily, but it is invisible to most of our constituents and most consumers. We do not mine that much in the UK, although it is still an important industry to an extent in parts of the country; we still have aggregates on the go and there is still quarrying, but mining is something that happens abroad. Like other primary industries, it can be more important in developing economies than it is in the UK.

I want to emphasise the UK’s contribution to international mining, which primarily comes through trading in the City of London. Most large mining companies, or certainly many, choose to be listed in the UK for the prestige and the convenience, and because they can raise capital here, and many that are not primarily listed in the UK are present in a large way. The large mining companies are listed here—smaller ones are on the AIM, the alternative investment market—and UK industries such as financial and legal services service the mining industry. Arguably London, along with Toronto, is at the forefront of the international mining industry, but much like shipping, we often do not realise that, because most of the mining goes on abroad.

In developed states, the things that we think of and speak of most and that dominate our daily lives are the services that we consume—the constant flow of ever more astonishing inventions, technologies and concepts that make our lives easier, more fulfilling or, often, simply better. People’s creativity often seems boundless. That ability and instinct to improve design means that new, astonishing things appear almost daily. The acceleration of ideas and technologically intelligent advances seem to be on a near-constant upward convex curve.

As an eight-year-old, I remember very well—I checked on Google to see whether it was a false memory—my dad getting me out of bed at 4 or 5 o’clock in the morning to watch Neil Armstrong and Buzz Aldrin landing on the moon. They played a bit of golf and turned the moon into a fairway for a brief period. That seemed like the apex of technological advancement for a very long time, but when we look back, we can see that technological advances have continued on a remarkable upward curve. The moon landing seems a very long time ago in technological terms. It is almost a bore to reflect on how things have changed. One thinks about computers in the period since then; the technology involved in that amazing scientific advance and historical event is very far behind where we are today.

We tend to reflect on what affects our daily lives and our services at the expense of the primary industries that facilitate them. In fact, mining uses many technological advances. One sometimes makes a false dichotomy between complexity and cleverness and the services we use daily. We sometimes forget that the primary industries on which the service industries rely are very sophisticated.

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One reason why technology dominates our daily discourse is that we quickly adapt to new ideas, come to rely on them and want yet more. We adapt using our intelligence, and that is fabulous—we expect fabulous things and see them every day on the internet. The internet itself is a fabulous thing. Not everything that evolves through it is the best, but much of it is.

I am not complaining about new technologies dominating our daily lives, but they often challenge us to think about what values lie at the heart of the way we live. We have to consider whether certain new developments are advantageous, such as the potential meeting of the internet, DNA and new insurance products. We have to decide whether to allow them to happen and to go with the flow. We have to make a value judgment: perhaps we will know more about our futures and our own likely means of death if we choose to allow such things. That might or might not be desirable, but technology makes us make such value judgments. I guess that that is why these things are often at the forefront of minds in the developed world.

What is often at the forefront of people’s minds in the developing world is that the mining industry is potentially the only way of getting early money other than aid into the economy. Aid is very nice, but it is on a relatively small scale and can only ever be a sticking plaster. Often, the international mining industry comes along and has a transformative effect on the economy in the developing world, although not always. People talk about the resource curse, but we never think of calling oil and gas in Scotland a curse. We think, in a rather superior fashion, that it is okay if we have it, but that perhaps it is a curse to people in the developing world.

Of course, the result is not simply a function of the mining industry. It is usually a function of local governance and the capacity of a country to benefit from the exploitation of its natural resources. Sometimes other variables have to be fixed. Expectations can be high, and mining is very capital-intensive—it takes many years before the money is won back in profits, which is when populations start to benefit. Another variable is that people are sometimes moved out of other necessary parts of the economy, such as agriculture, into mining; there is a drag factor that takes people away from essential parts of the economy, often primary industries themselves. However, there are places in the world where it has been got right—in Africa I think of Zambia, and elsewhere I think particularly of Brazil. In many places, developing economies are being pulled out of low income into middle income and potentially, in the future, even into high income. I think even of Rwanda, where mining is not a large industry but a significant one all the same and makes a very important contribution.

I wrote down a few ideas for this speech last week having spent a month in Cornwall, as I do every year. I was in a very beautiful part of Cornwall—I should say that I informed the hon. Member for St Ives (Andrew George) that I was going to mention his constituency. I was staying in a cottage with my partner, and I looked out at what appears to be a memorial standing on the edge of a promontory, sticking out over a point where two seas join, which I discovered when I was down there is called Cape Cornwall. It is quite a remarkable sight—it looks like a memorial, but it is actually a chimney stack on the very edge of the promontory. Underneath the

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chimney, out to sea in the cape itself, is a set of rocks called the Brisons, where the mining industry pulled tin out of the ground, as it did right across Cornwall, effectively starting the industrial revolution. Hayle, the local port, was involved right at the start of the industrial revolution.

In due course, Cornwall’s mining industry had its time and then declined, which was largely to do with world tin prices. It was cheaper to extract it elsewhere in the world, and we became a different type of economy. As I said earlier, the service industry and new technologies came along, and other countries took over tin production. I will not bore the House with where tin extraction takes place now, but it is concentrated in a small number of countries, as is the extraction of things such as bauxite, which potentially will be concentrated in Guinea. That development is very much led by Rio Tinto, a UK company based and listed in London. The ground has already been broken for the initial infrastructure work, and when that development takes place, it will lead to the employment of thousands of people, and in many years to come—hopefully not too many years’ time—that will lead to substantial tax receipts for a country that currently has very few. It will also lead to infrastructure, because a railway will need to be built to export the bauxite from the site.

It is easy for us to forget the benefits of mining. I well understand why many good people I have known over the years through my involvement with the mining industry and the non-governmental organisations that are interested in it are often very negative. In this place, I hear more negative things being said about the international mining industry than I hear positive ones. To some degree, without wishing to be critical of people per se—certainly not Members of this House—there is a lack of awareness. Among our constituencies and our constituents, very few have a direct or immediate interest in this sort of mining—unlike with oil and gas—and their experience of mining is modest.

My constituency is just outside a next-door-neighbour refinery, so everybody understands the oil and gas industry. Everybody in the UK consumes oil and gas, and everybody sticks petrol and diesel into their cars as well as use gas in their homes. In the end, while there is much discussion and debate about the consumption of energy, I think people get a balanced perspective. The NGOs and the environmental bodies will lobby for good reason and encourage us to consume less and look for other ways of fuelling our lives. People also understand that we rely heavily on fossil fuels as well—and will do for some time to come. I often think, however, that when it comes to the mining industry, the public understanding is not there.

I am glad to see here on this occasion a Minister from the Department for Business, Innovation and Skills and not one from the Department for International Development. We tend to view mining as an international development issue when it is, in fact, very much a BIS issue. It is about UK businesses, and UK-listed businesses generating revenue for the UK and for overseas states. It is about helping with all sorts of areas of technological training within the UK and in the United States, contributing tax dollars or tax pounds. It is something we hear very little of.

People tend to hear the message that mining has had a chequered history. We all recognise and know about the many legacy issues throughout mining. For a period,

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and particularly in Africa—I know this very well—many deals and sales of assets were made that were very dubious. Mining companies bought assets off middle men, and 20 years ago, many questions were asked about mining companies. Now things are really quite different. The mining industry, including very large operators, as well as middle-sized and small operators, are very aware of public scrutiny of what they do, and they have very high standards of governance. That is sometimes not reflected in this place. It sometimes seems very hard to get a balanced debate or a balanced sense of what the mining industry is about.

When I engaged with the Government in the past, I tended to find myself having conversations with DFID. I understand why the matter will not be a top priority for all BIS Ministers, because this is not a big industry as such for our constituents, but in the end, I think the UK is probably in the leading position when it comes to this industry.

The Minister will probably be aware that I sit on the UK EITI—extractive industries transparency initiative—multi-stakeholder group. People might say that the UK does not need to sign up to the EITI. The initial concept was that it was for the developing world. Then Brazil and other countries such as India said, “If it is just for us, we are not going to sign up to it.” The UK sensibly decided to sign up, and we are going through the process now. So is the US, which is moving a bit faster, I suspect, because it has pretty much unlimited resources.

At the same time, legislation involving transparency and accounting directives to which we are signing up has by and large gone through with the consent of the whole House and, in the context of Europe, Britain has been at the forefront of those standards. In terms of who benefits, beneficial ownership from shares in large operators will pretty much be a feature of an open book as well. That is not to say, however, that the legacy issues do not exist. They certainly do, but sensible, well-governed mining operations need an opportunity to present their case to the public, so that we can understand the benefits, as many of the people they employ understand.

I will conclude on that point. No doubt the Minister will have a number of things to say about the support that his Department gives the mining industry in the United Kingdom, but I wonder whether he would consider meeting me, along with representatives of the mining industry, to discuss what the Government and the industry can do together to give people a much clearer understanding of the benefits that the industry brings, in balance with the important nature of governance under the control of the NGOs that we all know and love.

8.45 pm

The Minister for Business and Enterprise (Matthew Hancock): I congratulate the hon. Member for Falkirk (Eric Joyce) on securing the second debate on this subject that he and I have enjoyed. I think that his approach—including his emphasis on the role of mining in helping developing economies to trade their way out of poverty and into prosperity—is precisely the same as the approach that the Government take. It should be borne in mind that without the extraction of minerals such as coltan from developing countries such as Ethiopia, Mozambique and Brazil, it would not have been possible for his mobile phone to ring at the start of the debate.

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That approach is telling and practical, as well as being the right approach and one that we have taken at national and international levels.

The hon. Gentleman observed that some countries had used mining to take themselves out of poverty. He mentioned Rwanda, Zambia and Brazil, but it is also true that Botswana, which became an upper-middle-income country in 2007, was one of the world’s poorest countries when I visited it for the first time in 1996. Its success has been due largely to well-managed mining revenues from diamonds.

The hon. Gentleman spoke about the transformative effects of mining, pointing out that in some parts of the world such transformations are not positive. The success of mineral exploitation is down to governance as much as to physical extraction, low bribery rates, and law and order. The problem of conflict diamonds, for instance, arises when law and order and governance break down. This country has experienced the benefits of mineral extraction under good governance. That began in Cornwall, and evidence of the tin mines still litters the peninsula, but it has also happened in the midlands and the north of England where coal has been extracted, and, of course, in Scotland. The potential boost to economic growth is strong, is recognised, and is due to good governance as much as to the minerals themselves.

We take a cross-Government approach, which includes the Department for Business, Innovation and Skills and, of course, the Department for International Development. DFID has invested more than £50 million in bilateral aid spending on support for trade structures—for instance, building trade capacity and promoting regional integration to help to ensure that the governance is in a good place. The hon. Gentleman rightly emphasised that trade can serve as one of the most powerful functions ever introduced to increase prosperity and remove countries from poverty, but, as has been demonstrated throughout the world—not least in China—DFID also has a role to play in strengthening institutions, and strengthening the structures and the governance under which trade operates. We know, from our experience over the past few decades, of the enormous benefits that that engagement under good governance can bring. Indeed, extractives companies are important partners for us in government, ensuring that we help developing countries to make the most of their riches when they find them under their soil in order to drive up growth. That is the approach we take.

The hon. Gentleman mentioned the extractive industries transparency initiative. This is about progressing towards a common global standard of extractives transparency so that more citizens in poor countries share the benefits from natural resources. We are working with the World Bank, for instance in Mozambique, where we are investing in mining and gas sector reforms. We will support the Government of Mozambique to make sure that the laws on the ground are supportive, that operational standards are good, that health and safety is supported and that geological information systems are helpful. I pay tribute to the work that the hon. Gentleman has done as part of the EITI.

In May last year, the Prime Minister announced that the UK would sign up to the EITI. It is designed to build trust and dialogue between companies, civil society and industry. This is all about putting information into the public domain to promote public debate.

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I also want to pay tribute to my hon. Friend the Member for Worcester (Mr Walker), who instigated the Business, Innovation and Skills Committee report into this area. This transparency is important, and many extractive companies are listed or headquartered in the UK and are supportive of the EITI. That stakeholder engagement has been very beneficial. For example, Rio Tinto and Shell sit on the multi-stakeholder board. Furthermore, in taking forward the beneficial ownership rules—pushed by the Prime Minister internationally and in the small business Bill—and in abolishing bearer shares and increasing the accountability of international business, we are acting in support of the direction of travel that the EITI plays such an important role in encouraging.

I note the presence of the hon. Member for Linlithgow and East Falkirk (Michael Connarty), who plays an important role in driving this agenda and helping to ensure that, through engagement and improving policy at a global level, mining and industrial development in developing countries can, through good governance, benefit the whole of those countries.

I reiterate the Government’s support of the EITI multi-stakeholder group, of which the Under-Secretary of State for Business, Innovation and Skills, my hon. Friend the Member for East Dunbartonshire (Jo Swinson), is the Government representative. I acknowledge the rapid progress that has been made to date. The UK successfully submitted its candidacy application on 5 August this year. That is a key milestone in taking the EITI forward, and we look forward to the outcome in October of the next international board meeting. By signing up to the EITI, we want Governments to know that the EITI is not just for developing countries but that it is a

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global standard, and we have a stronger argument to encourage emerging and developing countries to adopt similar rules if we have adopted them here at home.

Finally, I want to reiterate the importance of the trust and transparency agenda more broadly. It matters in mineral extraction, but it also matters across the board: making sure we know who really owns and controls UK companies, which will help us to have a publicly accessible central registry of people with significant control; improving the transparency of corporate ownership; and making sure that the UK is a trusted place to do business and invest.

The UK has a specific role to play in driving this agenda because of the number of global companies headquartered here, and because of London’s role as the pre-eminent global centre of international finance. Therefore, taking steps here in this House of Commons, such as allowing overseas conduct to be used as a basis for disqualification here in the UK and increasing the time limit within which proceedings can be brought following an insolvency, have an impact across the world in driving this agenda forward.

I hope I have assured the hon. Gentleman that the Government recognise the important role of mining companies in developing economies, as well as the role of good, strong governance domestically and internationally in ensuring that bringing prosperity out of the ground through the extraction of minerals has a positive economic impact on the local economy, supports prosperity and ultimately supports what we are all here to do—namely, to improve the well-being of our citizens and other citizens around the world.

Question put and agreed to.

8.55 pm

House adjourned.