My Lords, I declare my interests as farmer and landowner, as set out in the register. I broadly welcome this Bill and will confine my remarks to those areas that have been less widely addressed. I start from the premise that this Bill should principally focus on agriculture.
Public money for public goods is an excellent mantra, and support is directed at the range of activities listed in Chapter 1 of Part 1, on which environmental land
management schemes will be based, together with measures to improve productivity in the sector and supporting ancillary activities. However, the seven-year transition period becomes a problem if financial and other details are too sketchy for farmers and land managers to have enough information on which to base investment decisions. We know what basic payment will be paid in 2021, but not in the remaining years.
Similarly, we know that the ELM scheme currently being piloted will not be available to roll out until 2024. Absolutely no financial or other information is available to enable farmers to calculate the likely return of implementing a scheme. Remember, without profit there is a risk that they are not taken up and land is abandoned. Without the BPS, 24% of farms make a loss; return on capital in farming is around 1%, well below returns in other parts of the food industry. Farmers need profits to survive. No doubt farmers on good land will thrive without BPS, as will those in parts of the country where diversification can be driven by good location and so on. But those on the poorer land and in less desirable places will really struggle, and many will leave the industry. My first point is to reduce these uncertainties by providing clarification on the remaining BPS payments and early information on the likely financial returns from ELMs. Accordingly, a delay in implementation to 2021 would make sense.
My second point is the issue of skills, which should be covered by a clause of its own, rather than coming in the catch-all clause on productivity. Work is currently being done on this by a group ably led by the noble Lord, Lord Curry. The establishment of an industry professional body to lay down, monitor, measure and advise on common standards is crucial to the industry and requires government funding to underwrite its role. Such an amendment will be tabled.
The proposed five-yearly review of food security is excellent and, once the methodology is established, one hopes that it will become an annual or biannual event. Although not directly specified, the review should cover both skills in the industry and the profile of participants. Currently, farming is characterised by a high average age, with a third being over 65 and only 3% under 35. An unattractive career image, based on low median earnings, needs to be watched.
My final point relates to intervention in agricultural markets. It is very narrowly drawn and excludes exceptional weather events or animal disease. Intervention seems to depend on reduced market prices, although some events could lead to higher prices, which are not available to farmers if they have nothing to sell. I request that the Minister look at widening the definition of intervention.
In farming, there is an old adage: timeliness is godliness. This should be a guiding principle of this Bill, as the importance of food security is increasingly recognised.
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