Examination of Witnesses (Questions 240
- 247)
WEDNESDAY 24 OCTOBER 2007
Mr David Fursdon, Professor Allan Buckwell, Mr Andrew
Douglas and Mr John Don
Q240 Chairman:
It is like all of us, we are all in jobs that sometimes the market
rewards and sometimes it penalises, and if you get it wrong you
move out.
Mr Don: The sheer volatility of farming and
the importance of having a strategic supply of food and fuel is
going to be a long term need for Europe and for this country.
Chairman: I think on that point I will
hand over to Lord Bach.
Q241 Lord Bach:
I want to ask about budget implications. I detect a difference
of emphasis, if I may say so, putting it mildly, between Scotland
and England and Wales on the issue of what subsidies should be
for. I think Scotland thinks they should, in a way, be for production
still, while England and Wales certainly do not feel it should
be for production but for environmental goods. Am I right in detecting
a slight difference of emphasis between you on that, which would
be quite understandable? My next question is slightly more serious.
Even if England and Wales are right and there should be payments
made for environmental goods and environmental services or whatever
you call them, the issue arises as to why the tax payer should
fork out 43% of the EU budget to the CAP to get farmers to behave
properly environmentally when in most other industries—in
fact I think in all other industries—those industries get
penalised when they do not behave environmentally properly? Why
should it be the other way round with agriculture? Thirdly, the
figure of 43% was given to us in evidence last week, the total
budget of the EU being spent on agriculture and there is a hint
in what you have told the Committee in written evidence that you
do not think that the amount in the settlement in 2005 was enough.
Would you like to expand on why 43% across Europe on agriculture
is not enough?
Mr Fursdon: Can I start by giving the England
and Wales view which is that while we certainly subscribe to the
view that environmental payments are the way forward and that
is what we would expect to see the CAP for, there are other things
as well in our evidence that we suggest that money should be for.
Some of that is production of food in a way which is environmentally
sustainable. There is an element of making sure that production
can be done right, ie in an environmentally acceptable way which
we believe is one of the objectives of the CAP. I obviously cannot
speak for my Scottish colleagues but I would say that we believe
in the environment but we believe that there is an interaction
with production if we are going to produce food in the right sort
of way. In terms of why the tax payer should pay, going back to
making sure that we have the ability to produce food in an environmental
way and contribute to climate change are, we believe, pretty important
things. When you look at the amount of benefits provided by land
managers for which there is no market reward, we believe that
that is the reason why, in the industries that we are involved
in, there is more of a case than there is in some other industries
where there are not the same degree of public goods provided.
Mr Buckwell: The 43% of the European budget
is the most phoney statistic that anyone, including the prime
minister, could use. Because we decided to only give agriculture
and structural policies to Europe then of course their budget
share figures larger in the European budget. What matters is that
the 53 billion euros per annum on budget heading two in the European
Union is about 0.5% of EU GDP, it is about 1% of European total
public expenditure. That is the figure that we should be looking
at in relation to looking after 75% of the territory, 75% f the
environment; most of the bio-diversity and the natural environment
is in that 75% and not the urban part where there is little natural
environment; it is dealing with 40% of the population, 5% of the
working population and 3% of EU GDP. We feel that 1% of the European
budget to do all that is not completely stupid. When we see that
the challenges confronting us in both food and the environment
in the decades that lie ahead, it does not seem to us to be completely
stupid to think that we might have to spend more to get what Europeans
want on those fronts rather than less and that we would rather
argue about what the policy is for and how we are going to achieve
it and then decide the budget, rather than do what the UK Government
is hell-bent on doing which is to reduce the budget first and
then ask what we are going to spend it on. That is our answer.
Why should consumers pay for the environment where other businesses
are paid to obey environmental laws is a very good question. It
is because land managers, farmers, steward environment the way
that no other business does. If you simply say to farmers, "We
are liberalising your market, we will expose you to international
prices, you are going to get no single payment (which is the UK
vision) and we will give you a small amount of money to deliver
a few environmental goodies", do you think we will get the
English countryside that the public wants because I do not and
we do not. Go and talk to the environmental organisations, they
do not think so either.
Q242 Lord Bach:
Why should farmers have to be paid, that is what I do not understand?
Mr Buckwell: Because consumers will not pay
in their food. Take organic farming. Organic farming has had 30
years of massive publicity. It is a sign of quality, of looking
after the environment, and still it is only about 3 or 4% of total
consumption and we have to provide public subsidy otherwise we
do not get enough of it. There is a clear indication that what
people say they want in environmental standards they do not match
in their purchases in the supermarket. If we do not provide some
assistance to the deliverers of these environmental services then
we will not get the services.
Q243 Chairman:
I used to help run a medieval university and it had some medieval
buildings which were quite expensive to maintain. People used
to flock in droves to look at this wonderful university campus.
Tourist buses used to stop. We had to spend a lot of money on
maintaining it but we did not get a penny of public money to sustain
that environment.
Mr Buckwell: That is why our heritage is crumbling.
Q244 Lord Bach:
You would argue for more money, not just in agriculture but much
wider than that.
Mr Buckwell: We are certainly saying that there
is such a thing as rural cultural heritage which costs to be maintained
and those who are bearing those costs are being exposed to unremunerative
prices by the market alone so that if you take away the present
support do not expect to get the same quantum of looking after
of these services.
Q245 Chairman:
Surely the argument is that you could get the environmental return
through regulation but at a cost which has to then transmit itself
through the price mechanism.
Mr Buckwell: I guess the argument then is: can
you achieve the outcomes we were talking about by regulation,
by fear, thou shalt manage your farms better. I am suggesting
to you that our experience in being able to do that is not very
satisfactory. In terms of achievement and results you will find
that if you try to bring about the environmental standards you
want by pure regulation you will not achieve it. Look at the mess
we have made of the regulation of the single payment and environment
schemes at their introduction. That is a really sad thing because
the last four years were correct moves in policy, the farming
industry in a sense was signed up to it and we made such a bad
job of the administration of the introduction of the single payment
and environment schemes that farmers are turned off these things.
Q246 Lord Bach:
The 43% figure is not just used by the prime minister, it was
used by the environmental groups that came last week. It was they
who gave us the 43% figure. I think maybe a word in their ear.
Mr Buckwell: Thank you for the tip.
Q247 Chairman:
I will now just give you the chance, if you think there is something
you really wanted to say and have not had the opportunity, now
is the time. If not, very many thanks.
Mr Buckwell: R and D and extension for agriculture,
how we are going to produce the food we want in the world with
the environmental standards we want in the world is a very serious
issue. Again it is not all being done by the private sector and
in Europe we are turning our back on some of the technologies
that are on offer. This is a very serious issue.
Lord Plumb: I wonder whether the CLA
and Scotland could respond a bit on trade liberalisation. The
Doha Round is ahead of us and who knows what effect that is going
to have on liberalisation, what effect will it have through the
phytosanitary measures and so on and so forth. Are they going
to be more important to us than tariffs and so on? I think if
you could expand on them a bit in your notes back to us that would
be very helpful.
Chairman: Thank you very much indeed.
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