5A way forward
90.The previous chapters of this report have shown how the future of the natural environment after the EU referendum is dependent on a number of factors—both domestic and international. This final chapter highlights the next steps that Government should take to begin to manage these issues and ensure that leaving the European Union does not result in a reduction in environmental protections, and instead to take advantage of the opportunities available to improve the UK’s approach to land management.
Defining objectives
91.One of the most cogent criticisms of the current CAP that the Committee received was that Pillar 1, which accounts for most of the money, has no clear objectives.166 There seems to be an impressive degree of cross-sectoral consensus that whatever replaces the CAP should have clearly defined objectives, within which the objectives for agriculture and for the environment are fully integrated. With this in mind, it would seem sensible not to replicate the two Pillar structure of the CAP.
92.Natural England, in their written evidence, pointed out the need for ‘a clear overarching policy framework for the use of the agri-environment scheme mechanism’.167 They also pointed out the need for a ‘clear national strategy’ and warned of the need to ‘avoid one policy being used to counter the negative consequences of another’. A wide range of bodies have given evidence that there is a major opportunity to develop a new, more efficient and more effective system of support for land management as a whole. Government environmental bodies argued that leaving the European Union offers potential opportunities to develop alternative arrangements for a better environment, better farming and a better countryside.168 Sir James Bevan of the Environment Agency said:
My greatest fear will be that we do not seize the opportunity that we have to make things better. This is an opportunity. Whatever you think of EU legislation, it is not perfect.169
93.Achieving better outcomes for the environment is dependent on the work of those who directly manage the countryside. However, we heard that farmers in particular often feel they are subject to a scheme, rather than having a sense of ownership of the outcomes that are being sought.170 Government needs to engage with farmers and their organisations and with environmental bodies to discuss its future policy objectives.
94.The current CAP model allocates funding on a farm by farm basis, with no consideration of the relationship between farms and the wider landscape. Several witnesses have advocated adopting a landscape scale approach for any future funding model, involving spatial targeting so as to be flexible enough to meet local needs but with a clear line of sight to national environmental objectives.171 Patrick Begg of the National Trust said:
It is about, at a sensible level—landscape scale, catchment perhaps—setting a range of outcomes that we want to buy, and then working with the farmers and the land managers to define the path to get there. Setting down a recipe that they have to follow and inputs and processes to get there is less successful.172
95.Setting of clearer objectives and the adoption of a landscape scale approach could be compatible with the stronger articulation of public goods and innovation discussed in chapter 3 of this report. Witnesses have also highlighted the importance of determining to what extent the devolved nations should share high level objectives. Martin Harper of RSPB said:
The issue to work out is where common standards are appropriate and where they are necessary. Clearly we operate within the United Kingdom with wildlife moving around and water moving around. I think the judgment is: do we want to maintain common standards and approaches?173
Mr Harper also highlighted that establishing a UK-wide national framework, if it were desired, would pose difficulties for Government due to the potential need to amend legislation such as the Scotland Act, which devolves environmental matters to Scotland by reference to EU legislation as a national framework.174
96.Any new scheme of agricultural funding and environmental protection must have clearly defined and internally consistent objectives which are integrated across the whole land management sector, rather than replicating the current two Pillar system. As we have already discussed, the provision of public goods, especially positive environmental outcomes, should be central to this. The legislative framework and the system of financial support should both be designed to achieve these objectives. There is widespread support for an approach which focuses on a landscape scale, rather than individual landholdings, so as to respond to local needs and use local knowledge. This would still require clear articulation of national objectives through a national framework, including coordination within and between the devolved nations.
This conclusion is linked to our first and sixth recommendations.
Providing certainty
97.Several witnesses have expressed concerns about uncertainty over the future of funding beyond the point of leaving the EU, as it may lead to farmers taking actions which preserve their revenue from other sources at the cost of environmental management. Without certainty farmers may, for example, plough grassland as a means of securing maximum flexibility in future farm practice (as happened during previous rounds of CAP Reform).175 There is a short timeframe within which this certainty can be provided, as farmers typically have long planning horizons, and supply chain planning of food production for 2019 will begin in mid-2017.176
98.To date, the Government has guaranteed funding to all multi-year EU agreements, including agri-environment schemes, which are signed prior to leaving the EU providing they meet UK priorities and value for money criteria.177 The Secretary of State for Defra could not say what these criteria are, as they were under discussion with HM Treasury,178 and no further certainty on arrangements for the environment or agriculture was provided in the Autumn Statement, despite the Minister indicating that more detail would be provided around then.179 Witnesses have however welcomed the degree of certainty provided by the announcements so far. George Dunn of the Tenant Farmers Association said:
As far as they go, what the Treasury has announced has given the breathing space that we need to do the thinking necessary for the long-term changes that will be required.180
The Secretary of State has expressed a commitment to ensure a smooth transition and provide business certainty in the process of leaving the EU, although she was unable to confirm whether this would be through a clear policy announcement in the near future or through further interim commitments.181
99.However, the Secretary of State also refused to distance herself from statements made prior to entering Government in which she said she was in favour of phasing out farm subsidies altogether. In her evidence to this inquiry she was unable to provide the agricultural and food industries with any certainty that there will be a replacement for the CAP in the long term after we leave the EU.182
100.The guarantee of continued funding for CAP agreements signed up to the point the UK leaves the EU is welcome. Farmers will begin planning for 2019 in 2017 and so will require further reassurance regarding the arrangements which will be in place after this point. This must be provided in a timely fashion so that farmers can be confident in the inclusion of environmental protection measures in their business plan.
This conclusion is linked to our second recommendation.
25 year plans
101.The Conservative manifesto for the 2015 election contained a commitment to produce 25 year plans for England for the Natural Environment and for Food, Farming and Fisheries. The Government has remained committed to developing these plans. However, both agricultural and environmental witnesses to this inquiry have criticised the separation of the sectors. Patrick Begg of the National Trust said:
It seems to me mad to have a food and farming plan and environment plan when everyone is talking cross-sectoral about the integrated nature of those issues. We have an opportunity now, if we want to take it, to bring those much closer together more formally and to give us a better outcome at the end of it.183
George Dunn of the Tenant Farmer’s Association supported this view, saying that:
It is madness that we should be looking at these things in isolation. They feed off each other. They will benefit from each other’s thought processes.184
102.Witnesses are unconvinced that there is a reason to keep the plans separate beyond making them easier to manage for Government.185 However the Secretary of State defended this separation, saying:
They do need to complement each other but they are focused on slightly different targets. One is a huge economic question, a big employment question, a big subject around the great British food brand, animal welfare, food safety, food traceability. The other is very much about what environment do we want to be living in for our children and grandchildren. I think it is right that we have two separate plans.186
103.Development of the 25 year plans will occur alongside negotiation to leave the EU, and should inform that process. The Secretary of State has indicated that consultation on the plans will take place in 2017 following the publication of a framework for each plan.187
104.The development of 25 year plans could have provided a means by which the issues presented in this report can be addressed in the period up to leaving the European Union. The Government should have had a clear view of its objectives before entering into negotiations to leave the EU. However, the 25 year plans will not be completed before entering negotiations. This risks the Government negotiating towards an undefined goal.
105.We have not been presented with a strong case by Defra as to why having the plans separate is the best solution for the natural environment, especially after the referendum result. Defra must ensure that the plans are clearly part of a strategic whole, with mutually reinforcing objectives.
This conclusion is linked to our third recommendation.
166 Q142 (Mr Martin Harper)
169 Q284 (Sir James Bevan)
172 Q202 (Mr Patrick Begg)
173 Q121 (Mr Martin Harper)
174 Q122 (Mr Martin Harper)
177 This commitment was made by the Chancellor during a speech at the Conservative party conference on October 3rd 2016
178 Q372 (Right Hon. Andrea Leadsom MP)
179 Q29 (Dr Thérèse Coffey MP)
180 Q174 (Mr George Dunn)
181 Q365 (Right Hon. Andrea Leadsom MP)
182 Q387 (Right Hon. Andrea Leadsom MP)
183 Q175 (Mr Patrick Begg)
184 Q178 (Mr George Dunn)
185 Q179 (Mr Tim Breitmeyer)
186 Q343 (Right Hon. Andrea Leadsom MP)
187 Q347 (Right Hon. Andrea Leadsom MP)
21 December 2016