Backing the business of British Farming
George Eustice speech to the National Farmers Union Conference: 'Backing the business of British Farming', 25 February 2014
Introduction
It is a pleasure to be with you today at my first NFU Conference, but I would like to begin by giving Owen Paterson’s apologies. As many of you will know, he recently had an eye operation. Owen is not one who likes to rest – as I’ve discovered – so he has been itching to get back behind the wheel, but he has taken medical advice to make sure he allows for a full recovery, so that when he does return we will once again have him firing on all cylinders.
I would also like to take this opportunity to pay tribute to the great work that Peter Kendall has done over the past eight years at the helm of the NFU. I have joked before that Peter has almost seen as many farming ministers during his tenure as the Queen has seen Prime Ministers with, I think, no less than six of us over the last eight years.
But he took over at a difficult time for the industry when the horrors of the 2001 Foot and Mouth crisis were still very much fresh in everyone’s mind but I think he leaves the NFU at a time when the farming industry has far more confidence in its future and in its ability to meet future challenges. This transformation is in no small part due to the determination of Peter and his team. He has tirelessly made the case for British agriculture and put farming back at the heart of our countryside and rural communities, so Peter: thank you for what you’ve done and good luck in what comes next.
My message today is that the industry should have confidence in its future. Firstly, as Peter pointed out, there is growing consumer interest in food provenance. People want to know where their food comes from and how it was produced, and they are increasingly looking for locally sourced products.
Secondly, we have a rising world population set to top 9 billion coupled with increased demand for more westernised foods such as dairy products and meats.
As a result, demand for food is forecast to rise by 60 percent by 2050 and that means we need a vibrant and profitable farming industry in the UK to meet this rising demand and to supply these new markets.
Flooding
But before returning to these themes, I want to start by addressing the issue of flooding and the action this government is taking to get people’s lives back on track.
We have suffered the wettest winter for 250 years and the impact has led to thousands of properties being flooded and many families’ lives being turned upside down.
As the Prime Minister has said, we understand the hardship and disruption this causes families and businesses and we will do everything in our power to help the recovery operation now underway.
It was recently put to me in an interview with the BBC that the government was only announcing the actions it has taken to be popular. Believe you me, the one thing I have learnt over the past six weeks is that there is nothing popular about handling a floods crisis but the government has pulled out all the stops to meet this crisis head on.
Environment Agency staff have been out 24 hours a day making sure that flood protection assets have been working correctly. While it is of little comfort to those whose homes have flooded, it should be noted that the flood defence infrastructure we have in place has protected over one million homes that would otherwise have been affected.
We have also set up a crisis fund of £130m to help repair damaged flood defences. We have relaxed the Bellwin rules around government support to local authorities to ensure that they have the support they need.
We have given leeway to businesses affected so that they can delay paying Business Rates and we have instructed agencies from HMRC and the Rural Payments Agency to make allowances for these businesses affected by floods.
As the problem escalated, we put thousands of troops on standby to help protect communities, and the emergency services have worked around the clock.
There is nothing like a crisis to draw the farming community together. Perhaps it’s because we are used to it!
But countless farmers have been out there helping their local communities and their fellow farmers by offering straw or shelter and fodder to help those farmers affected get through the crisis.
Take, for example, the fantastic emergency response organised by the local NFU, and supported by farming charities, at the Sedgemoor Auction Centre to provide emergency fodder to those farms affected with many other farmers offering help.
In order to continue to support the recovery in the medium term, I can announce that Somerset County Council has agreed to work with the NFU to provide a continued storage site for feed and fodder. The site will be managed by two co-ordinators bolstered by a group of voluntary organisations and local businesses in order to make sure that farmers are able to get their businesses back up and running as quickly as possible.
The government will play its part too.
Today, I can announce further details of the £10m Farming Recovery Fund.
It will assist with 4 key areas of recovery offering support with uninsured losses to help get farms back into production again.
Firstly, it will help with the restoration of grassland. Secondly, it will support restoring productive arable and horticultural land, where soil structure has been damaged. Thirdly, restoring field access for vehicles and finally, improving field drainage.
To provide fast support for those farms that have been flooded, there will be an immediate response fund with grants for up to £5000 and which will cover up to 100 per cent of the eligible costs. This will be open for applications later this week.
There will then be a second part of the fund which will be held back initially so that funds are still available to help those farms which continue to be affected but where it is too soon to be able to assess the full extent of the damage.
Once we have a better picture of the scale of the damage we will reassess the upper limit for grants and we will keep the scheme under constant review so that it remains flexible and is targeted at those in greatest need.
We’ve also made changes to the Farming and Forestry Improvement Scheme to better help farms in flooded areas to build resilience and protect farm productivity in the future.
And from 1st April, rural homes and businesses affected by the floods will also have access to one-off grants of up to £5000, to help make them more resilient and better-protected from future flooding events.
Longer term, as Peter mentioned, we need to learn lessons. The Environment Agency has had river maintenance pilots underway since October.
These aim to allow farmers and landowners to de-silt their own watercourses without unnecessary red tape.
And we plan to have a new streamlined consenting mechanism in place by 2015.
In Somerset, the Environment Agency has overseen one of the biggest pumping operations the country has ever seen in recent weeks.
And we have committed to dredging the Levels as soon as it’s safe and practical to do so. We are working with local partners on a long term plan to reduce flood risk and improve resilience.
Finally, although there has been much predictable political debate about spending on flooding, the simple truth is that spending on flood defences is a major priority for this department. This government has continued to increase investment despite the challenges facing the public finances.
In the last four years we have spent over £2.4 billion on flood defence infrastructure compared to £2.2 billion in the final four years of the last parliament. In the years ahead we plan to invest record amounts.
In 2012 we increased spending by £120 million, and we insulated the Environment Agency from departmental cuts last year. We agreed an unprecedented 6-year capital settlement from 2015/16 to 2020/21 of £2.3 billion on flood defence.
The Rural Economy
But at Defra, as well as responding to emergencies, we also need to focus on creating the right environment for businesses to grow, and that requires a long-term economic plan. The rural economy is worth £211 billion a year. Rural areas are home to one fifth of the English population, yet they support nearly a third of England’s businesses. That’s around half a million businesses. Small and medium enterprises employ around 70 per cent of employees in rural areas and they are the lifeblood of the rural economy, and the engines of local growth. We need to get the conditions right for all these businesses to thrive. That means cutting the deficit, cutting fuel taxes, creating more jobs and improving skills wile sorting out the welfare system. This long-term economic plan builds a stronger, more competitive, economy and secures a better future for Britain by helping spread growth and prosperity all over our country.
For years, the rural economy and farms were ignored but today, the Government is doing everything it can to support them. And that means more jobs, more opportunities and more financial security for hard working people.
Economy and regulation
I said at the beginning of my speech that there were reasons to be optimistic about the future prospects of farming in Britain. But we will only realise that potential if we stick to this long term plan for growth. And today I want to talk about two key areas: cutting regulation and promoting innovation.
First on regulation. As many of you will know, I spent ten years working in the farming industry. And even 20 years ago, the burdens of regulation were high. It is partly because of my own experience in the industry that I want to bear down on the burden of regulation today.
This government has done a lot already.
At the beginning of this year Owen Paterson announced major changes to the livestock movement rules that we plan to implement in 2015. This will make it easier for farmers to manage movements from their holdings to grazing land.
We’ve just published the conclusion to the Red Tape Challenge on Agriculture.
In total we will scrap 156 regulations and simplify 134 more. And we’re going to slash guidance. Reducing by at least 80% the amount of guidance that farmers have to follow and saving them around £100 million a year.
We’ve also made progress on earned recognition which was one of the key recommendations of the Macdonald Review. 14 out of 31 on-farm inspection regimes now allow businesses to earn recognition, leading to reduced regulation.
Earned recognition in the Environment Agency Pigs and Poultry scheme saves farmers £880 a year. And on animal feed it could reduce the total number of on-farm inspections by 10,000 a year.
But while much has been done, there is more to do. We want to drive down the burden of farm inspections further.
We’re introducing new measures to enable agencies to target their inspections more effectively towards those businesses that pose the highest risk. And we are going to review the existing cross compliance regime to ensure that any sanctions are fair. We are pushing hard at an EU level for sanctions and penalties to be more proportionate.
So we will not let red tape hold your businesses back.
The farming and food sectors have a key role to play in this Government’s Long-term Economic Plan. They’re the drivers of local growth, and the foundation of economic security.
Innovation
But I want to talk about innovation. If we want a competitive and successful farming sector then, as well as reducing burdens on business we must also promote innovation.
After major advances in farming productivity in the immediate post war period, improvements in productivity have stalled in recent years. The UK has always had an excellent reputation for science and technology. We need to build on this to capitalise on the very real opportunities that exist for growth.
In July, we launched the first ever Agri-Tech Strategy in the UK committing £160m to translating our excellent science into industry-led, practical applications. £60 million will go on promoting the commercialisation of knowledge and £90m will go to developing world class centres of excellence in research. There has been a huge amount of interest already.
As well as innovation we need new entrants to the sector. All industries need new talent to move forward and farming is no exception. I want to move away from the position where only those who inherit a farm can own their own businesses. We need other models from profit sharing to contract farming to ensure that the bright young talent in agricultural colleges today can fulfil their aspirations. And as Peter mentioned, we need to promote the status of farming as a career in our schools.
Protecting plant and animal health
I want to say a few words on protecting plant and animal health, because safeguarding the health of plants and animals is not only vital to our environment but also to our farming industry and the wider economy, so where there are problems, we have acted.
One of the biggest threats to animal health and our livestock industry in the UK today is bovine TB. For anyone who thinks this disease is a problem for just a few farmers in remote parts of England they should just look at the facts.
Between January and November 2013, over 30,000 cattle were slaughtered, an average of over 90 cattle a day. The continued spread of this disease poses a growing threat to farmers in parts of the UK that have largely managed to avoid it until now.
We all know that BTb is a difficult disease to fight.
There is no single measure that will, on its own, solve the problem.
Instead we need to pursue a range of options which together can make a difference and turn the tide on the disease. It is why we are researching the potential for vaccines and it is why we continue to take further steps to improve cattle movement controls to limit the spread of the disease. But let’s be clear: there is no example anywhere in the world of a country that has successfully tackled TB without also dealing with the reservoir of the disease in the wildlife population.
While the badger cull policy is contentious, we believe that it is a vital element of any coherent TB eradication strategy.
Last year farmers in Gloucestershire and Somerset, the NFU, Defra and many others collectively took a very difficult but also very significant step forward in farmer-led efforts to tackle the disease reservoir in the badger population.
I pay tribute to the work of all those involved in the pilot culls often in the face of intimidation and harassment.
We have learnt many things from our experiences last summer, so it’s important that we give due consideration to the Independent Expert Panel’s report before making a decision on culling in new areas.
But without prejudging this decision, Natural England has encouraged anyone interested in a badger control licence to start planning ahead and make an expression of interest.
Exports
So, cutting red tape, encouraging innovation and safeguarding plant and animal health all set the right environment for farm businesses to grow. And I want to conclude by talking about some of the opportunities.
Yesterday I was in Dubai for the Gulfood exhibition, where over 100 British companies were present promoting British food and food catering equipment manufacturers.
Our exports to Dubai increased by 14 percent last year and there is growing demand for British dairy products and British lamb.
Owen Paterson has prioritised opening new markets since being appointed. In the last year alone we have opened up 112 markets for animals and animal products, contributing to an increase of nearly £180 million in these products to non-EU markets. The latest provisional figures show that British food and drink exports have grown to nearly £19 billion in 2013 and there is room to grow even further.
In just the last year:
- we signed a deal on pork with the Chinese that has contributed to £9 million of growth in the pork market, in addition to £12 million of growth in hides and skins;
- we secured a deal on beef and lamb to Russia worth up to £100 million over the next three years;
- we agreed a deal on porcine genetic material with China, which alongside live pig exports is worth up to £45 million over five years; and
- in October we re-launched the joint government and industry Export Action Plan, which commits us to deliver £500 million of value to the UK economy by supporting 1000 companies with their international growth by October 2015.
The world’s population is growing. Tastes are changing and we want British Agriculture to be at the forefront of supplying these new markets.
Concluding remarks
So I want you to know that this Government backs the business of British farming. You are at the heart of our long-term economic plan.
We are working with the sector to increase resilience. And We are creating the right environment for businesses to grow and flourish. We are cutting red tape and farm inspections. We are encouraging all forms of innovation in agriculture. We are making significant progress in safeguarding our plant and animal health. Together, we are growing the rural economy.
We cannot do this without you. We need to work to ensure that the changes we make are the right ones and are implemented in the right way.
I look forward to working with you and your new President closely, making the sector ever more resilient, ever more successful.