It is a pleasure to serve under your chairmanship, Mr Chope. I thank my hon. Friend the Member for Thirsk and Malton (Miss McIntosh), the Chair of the Select Committee, for securing the debate.
First, I want to say that I am probably a very sad case, because I spent 10 years in the European Parliament, and all of that time was spent on the agriculture committee, which I chaired from January 2007 to June 2009. I am actually waiting for the men in white coats to come and get me; I am sure they will, before too long. The only thing that gives me some recompense is the knowledge that I will probably not be the only one who is taken away. It is a good idea to debate greening the common agricultural policy. Like the Chair of the Committee, I want to start with some history—how we have come to the place we are in—and the issue of the mythical level playing field that farmers always seek but that often seems further and further away.
We not only do not have a level playing field across the 27 member states of the European Union, but do not have a level playing field in the United Kingdom, because we have three different agricultural policies. The policy in England is to spread payments across the land and is not so historically based on the number of cattle and sheep kept, whereas in Wales and Scotland payments are made entirely on the basis of historical payments made to farmers between 2000 and 2001-02. There is no doubt but that we must look again at some of the systems of payment, because it is ridiculous to base an agricultural policy from 2014-15 to 2020 on payments made to farmers in 2001-02.
Another issue, which is probably more European, is that Estonia receives €70 per hectare and Greece €500 per hectare, so there will have to be a little bit of levelling of those payments. When in the European Parliament, I was not always admired by the French and Germans when I said, “In 2004, when the new member states came in, they were not equal, but by the time we get to 2014-15 and later, they ought to be much more equal.” Those payments will have to be levelled, like it or not, across the EU. The one good thing for British farmers is that we are somewhere in the middle of the payment table, between Estonia and Greece, so
should not be affected too badly by some sort of levelling. If there is to be any form of common policy, the level of payment across Europe needs to be considered.
The CAP was started in 1962 by five member states to produce food after the war, and it was successful in producing food until the 1980s, when there was a lot of food in the world and Europe was subsidising it. When there was too much food in Europe, we put it on the developing world’s markets, destroying their markets. Something had to be done about that. We were subsiding Greek tobacco, for instance. One can argue about whether it is right or wrong to subsidise food and food production, but to use good taxpayers’ money to subsidise tobacco takes a little bit of working out, especially when one third of the tobacco grown in Greece was burnt in heaps on the ground, one third was reasonable quality and the other third was dumped on to developing world markets, leading to Zimbabwe and other countries having trouble with this dodgy tobacco.
We have to face up to the fact that it is no good producing food for the sake of it. The idea of CAP reforms was to move towards an environmental, land-based payment. That is being done to some degree. It is also useful from a world trade point of view, because payments are put into the so-called green box and are not directly linked to production, and so can technically be made to farmers without distorting the international market for food. That also means that we are not directly subsidising the number of cattle or the number of hectares—in real money, acres—of corn, and so on, to produce more food.
We have rightly moved in that direction, but as we move into 2012-13 and onwards, we should recognise that we are now living in a different world. The Labour Government, slightly belatedly, worked out that there was a need for food and food production. I attended a Morrisons breakfast the other morning. We were talking about the affordability of food. There is no doubt—I do not level the charge at Morrisons in particular—that certain big buyers over the years have looked around the world to buy reasonably cheap food. However, now there are not vast amounts of cheap food to be had out in the world. China was eating 500,000 tonnes of beef 40 years ago, but is now eating 5 million tonnes of beef. The whole of the United Kingdom produced 1 million tonnes, but China is now eating five times the amount of beef that we produce. The beef produced in Brazil, Argentina and other countries that produce lots of beef is not necessarily finding its way on to our markets; it is finding its way into China. Therefore food and raw material prices are higher.
Although the CAP must be greened, it also has to reflect the fact that we need food that is produced at an economic price that our consumers can afford. I am a farmer—I declare an interest—and farmers would like the prices that they are paid for food to be higher. Of course, consumers are having to pay more. We should ensure that enough of the money that the consumer pays the retailer for his or her food gets back into the producer’s—the farmer’s—pocket. Although that is not necessarily part of CAP greening, it is relevant to agriculture and farmers’ incomes.