It is lovely to have you in the Chair, Madam Deputy Speaker. A large number of questions have been asked. I will endeavour to answer them as best I can, but if I miss any, hon. Members should not hesitate to catch up with me afterwards.
The hon. Member for Cambridge (Daniel Zeichner) mentioned avian flu and his constructive approach, which we have discussed outside the Chamber. As is clear, poultry will not initially be part of this new scheme, but I have asked and have been assured that the scheme and the new framework is sufficiently flexible possibly to include poultry one day if that were considered sensible. The service will be delivered by Livestock Information Ltd, which will be a public company jointly owned by DEFRA and the Agriculture and Horticulture Development Board, and its constitution will ensure that both Government and the farming industry are involved in key decisions.
The projected monetised net benefit over a 10-year appraisal period is, conservatively, £30 million. We might well hope for better. The new system is not yet live, but the existing sheep service is due to transition to the new arrangements in the spring of 2021. Cattle and pig services—pigs, in particular, are dealt with quite differently at the moment—are due to transition to the new service in 2022. The new service does not replace the individual traceability services run by the devolved Administrations. All data provided by the DAs and DEFRA to enable the AHDB to run the UK view will be handled in accordance with the data-sharing agreement that will be agreed by all Administrations. The AHDB will not be able to use data outside the terms of that agreement.
An important part of the traceability aspect of the programme is the work with the DAs to share data to ensure seamless traceability throughout the UK, which is important. DEFRA and the DAs will enter into an agreement to control and share data jointly—that is the UK view—and each territory’s traceability systems will be able to communicate with each other to support day-to-day business operations. That is clearly important for all parts of the UK.
Let me turn to the Direct Payments to Farmers (Legislative Continuity) Act 2020, which was focused, as we said at the time, on maintaining the status quo as the UK left the EU. It was not there to extend the scope of the regulations beyond 2020. The Agriculture Act is, in my view, the proper place for our post-2020 changes, which is why we have introduced this SI. The changes in the SI are not specific to 2021, so we will not need to bring forward SIs to deal with direct payments in future years of the transition.
I reassure the hon. Member for Angus (Dave Doogan) that Scotland has not been short-changed. Our manifesto committed to guaranteeing the current annual budget to farmers in every year of this Parliament, and we are delivering on that manifesto. The Secretary of State mentioned this several times when asked about it when he gave his statement to the House on the agricultural transition plan—was that only on Monday, Madam Deputy Speaker? I repeat what he said: EU funding currently still flows to the various nations and we will top that up to the agreed level, which is £595 million for Scotland annually. We used 2019 exchange rates, which were very favourable—a good thing—and that means that our commitment is greater than that which was spent under the common agricultural policy.
The Rural Payments Agency was mentioned, and I thank it enormously for its work to pay farmers over the past two or three days. The figures this year have been superb. A number of Members of this House who are in receipt of direct payments have been at pains to come up to me to thank me for their speedy payment this year, and I know that many farmers are impressed with the current service. I have a great deal of confidence in the RPA and I am very grateful to it for its hard work in these difficult times.
Although they were broadly out of the scope of this debate, I wish to take a few moments to respond to some of the substantive points made by the hon. Member for Cambridge about “The Path to Sustainable Farming”, which we published on Monday. This document is an important publication that sets out detail on the early years of the agricultural transition, including, of course, the reductions that we are going to make to direct payments. In 2021, we intend to apply a reduction of 5% to the first £30,000 that a farmer might receive. Higher reductions will be applied to amounts in higher payment bands. We intend to legislate for those reductions in an affirmative statutory instrument early next year. We will then reduce direct payments by around 15% in both 2022 and 2023.
The money each year will still go to farmers. We will ensure that they can access new schemes as receipts from direct payments fall. In 2022, we will start to roll out some core elements of the new schemes, and our sustainable farming incentive will support new approaches to farm husbandry. We are also offering a range of interventions to help farmers to get their businesses ready for transition, including a slurry scheme and a research and development scheme, and from 2022 we plan to offer an exit-support scheme.
We have confirmed our intention to make further simplifications to direct payments schemes from the 2021 scheme year. These simplifications will be made through a separate statutory instrument, which we intend to lay shortly. Changes will include removing the so-called “greening rules”—if ever anything were misnamed. it is those; they are in fact complicated red tape and have delivered very little for the environment—removing the requirement for farmers to use all direct payment entitlements at least once every two years; improving the arrangements for farmers whose land crosses borders between our nations; and extending the application period for farmers to make force majeure applications.
2021 is going to be a crucial year for agriculture and we will continue to work with farmers to get the start of the transition right, including consulting on delinking
of direct payments and exit schemes and starting the national pilot for the new schemes. We are keen to continue working with Members on both sides of the House as we progress our reforms.
Turning to the comments made by my hon. Friend the Member for Devizes (Danny Kruger), let me say that of course his mummy knows best. I learnt to cook at her school, so I have always been a big fan of his mummy. I went on a catering course there. It was a very long time ago, I am ashamed to say, but I use what I was taught almost every day of my life and I think of her often. As he mentions my dad, I also ought to mention that it is his 78th birthday today—so he is only slightly older than the average basic payment scheme recipient. It is right that in a debate about farming he is congratulated on his birthday. My hon. Friend made a thoughtful speech, and his local farmers should be grateful for not only his mother’s support, but his. I welcomed his input into the Agriculture Bill Committee. He is right to mention the more philosophical aspects. It is right that we discuss those as we make the most important changes in British farming for 50 years. I reassure him that I very much feel it is my job to stand up for British farming, and I believe that this Government, who have committed to total spend on agriculture for each year of this Parliament that is generous and right, will do that.
A few other points were made on the WTO statutory instrument. The powers given to the Secretary of State by part 6 could not allow the Government to deviate from the standards on animal welfare or animal food labelling. We discussed that in Committee at length. The issues are not within the scope of the agreement on agriculture, so the Agriculture Act simply could not apply in that way. The instrument is reserved to the UK Government because the functions within it simply cannot be exercised by the devolved Administrations—they do not have the legislative competence to act in these
matters for other parts of the UK. However, I would like to say, as I have said before, that England, Scotland, Wales and Northern Ireland officials have worked closely throughout the process of drafting these regulations and the final version takes into account the views of all four Administrations.
I am sorry that I have taken rather longer than anticipated, Madam Deputy Speaker, but a number of important questions were raised. I hope I have been able to answer them. What I hope will be clear to Members is how important these instruments are in implementing the intentions of the Agriculture Act. They provide continuity and certainty for stakeholders and beneficiaries in continuing direct payments beyond 2020. They enable us to fulfil our international obligations on agriculture and they provide the basis for the beginning of the agricultural transition. I urge the House to accept them.
Question put and agreed to.
Resolved,
That the draft Agriculture and Horticulture Development Board (Amendment) Order 2020, which was laid before this House on 12 November, be approved.