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Agriculture Act precedes UK’s departure from EU CAP

Grain Central, November 13, 2020

image credit: UK parliament

 

AFTER protracted debate in both the United Kingdom’s Houses of Parliament this year, final Agriculture Bill Commons amendments were agreed in the House of Lords this week, paving the way for post-European Union agriculture.

In addition to the nuts and bolts of creating a system of equity in agriculture, amendments negotiated through the Bill’s stages clarified its intentions on aspects of agri-food standards in future trade agreements.

Leaving the EU means the UK is leaving the EU’s Common Agricultural Policy (CAP).

The UK bill enacted this week provides the legislative framework for replacement agricultural support schemes and a range of powers to implement new approaches to farm payments and land management.

In England, farmers will be paid to produce “public goods”, such as environmental or animal-welfare improvements.

The bill also includes wider measures, including on improving fairness in the agricultural supply chain and on the operation of agricultural markets.

Stakeholder views

Most farm organisations and environmental groups broadly support the new “public-money-for-public-goods” approach to future farm support schemes.

Farmers had, however, called for the previous bill to have a greater focus on food production.

The new bill requires Ministers to have regard to the need to encourage the production of food in England in an environmentally sustainable way.

The peak farmers’ association in England and Wales, the National Farmers Union (NFU) has had much input by direct lobbying and consultation over the several years of bill development.

The NFU has welcomed recognition in this bill that “food production and caring for the environment go hand-in-hand”.

National Farmers Union president Minette Batters. Photo: NFU

“As the first domestic legislation covering agriculture for over 70 years, this really is a landmark moment for our food and farming industry,” NFU president Minette Batters said.

“Two years ago when the bill was first published, the clear absence of food production and food security troubled many.

“The NFU made the case…that this…legislation needed to recognise the role of farmers as food producers.

“It will also now play a crucial role in ensuring our farmers are not undercut in future trade deals by food imports that would be illegal to produce here.”

Farmers and environmental groups lobbied legislators to maintain food and animal welfare standards for imports under new trade deals, calling for legislation to underpin Government commitments not to reduce such standards in future trade deals.

The final legislation also includes a requirement for a report to be presented to Parliament focusing on the impacts that future trade deals could have on the food and farming sector.

Further amendments to the Trade Bill are expected to assign this responsibility to a statutory Trade and Agriculture Commission.

Government amendments now require reports to Parliament on the standards implications of future trade deals.

Enacted as the Agriculture Act 2020, the bill has been modified from its earlier drafts in that it:

  • provides enabling powers for Ministers to develop new farm support approaches in England. Direct payments to farmers are currently based on how much land is farmed. These will be phased out starting in 2021 over a seven-year period. New schemes to pay farmers for producing ‘public goods’ such as environmental or animal welfare improvements will be introduced. New items have been added to the list of purposes in the previous bill that can be given financial support, notably soil protection and improvement;
  • gives Ministers powers to intervene in agricultural markets in exceptional conditions, such as to provide farmers with financial support or operate public intervention and private storage aid schemes;
  • sets out measures to increase transparency and fairness in the supply chain for farmers and food producers. It does this by: introducing new requirements on collection and sharing of data; by placing fair dealing obligations on business purchasers of agricultural products; and by introducing new measures on producer organisations. However, this bill has increased the reach of the fair dealing measures so that any business purchaser must comply and a wider range of people selling products can benefit from the provisions;
  • includes measures on marketing standards and carcass classification. For example, to amend or revoke EU and domestic legislation or to set new standards tailored to suit UK agricultural sectors. New clauses are included in this Bill on certification of organic products. These are important for imports and exports as well as domestic sales;
  • sets out provisions to enable the UK to meet its obligations under the World Trade Organisation Agreement on Agriculture. The WTO Agreement sets limits on how support that is considered trade-distorting a country may provide.

Image credit: NFU

Application across UK nations

The provisions on new farm support schemes mainly apply to England. Powers are included in a Schedule for Northern Ireland to enable preparation of replacement schemes.

Some provisions in the bill apply to Wales (for example to amend Direct Payments rules) but these are intended to be temporary. Notably provisions mirroring English provisions on new support schemes that were in the previous bill have not been included in this bill.

Welsh Ministers intend to introduce in this Assembly term a Wales (Agriculture) Bill.

The Scottish Government introduced legislation in November 2019 which proposes to keep farm support approaches largely the same until 2024.

Aside from farm support, some measures such as those on food security and fair dealing in the supply chain apply to the four nations, while the various measures in the new Part 4 have different applications.

Measures on meeting WTO obligations also apply across the UK.

It is reported that the Scottish Government considers these matters to be devolved, so intends to withhold legislative consent.

Environment plan

A statement from the UK government Environment, Food and Rural Affairs Secretary George Eustice said the Agriculture Bill sets out how farmers and land managers in England will be rewarded in the future with public money for “public goods” such as better air and water quality, thriving wildlife, soil health, or measures to reduce flooding and tackle the effects of climate change, under the Environmental Land Management scheme.

These incentives will provide a powerful vehicle for achieving the goals of the government’s 25 Year Environment Plan and our commitment to reach net zero emissions by 2050.

This new system will replace the poorly targeted Basic Payment Scheme (BPS) subsidy system, which largely pays farmers for the total amount of land farmed, and has skewed payments towards the largest landowners, rather than rewarding farmers for any specific public benefits.

The funds released as a result of the phasing out of the legacy BPS will be re-invested into a roll out of our future farming policy, which will be centred around support aimed at incentivising sustainable farming practices, creating habitats for nature recovery and supporting the establishment of new woodland and other ecosystem services to help tackle challenges like climate change.

Source: House of Commons Library; NFU; Government of UK.

 

 

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