My Lords, this has been an interesting debate taking us through a range of issues. I thank the noble Baroness, Lady Bennett of Manor Castle, for tabling amendments relating to fungi. I listened to what the noble Baronesses, Lady Jones of Moulsecoomb and Lady Boycott, said on the matter. I declare my farming interests as set out in the register.
Clause 1(5)(b) already includes the conservation of fungi as conserving can relate to the restoring or enhancement of a habitat. In instances where it may be desirable to conserve wild fungi, or a rare species of fungi, this is possible through the power to conserve the habitat in which they exist. In Clause 22(6) and under Schedules 5 and 6, the definition of “agriculture” already includes fungi. In relation to Amendment 183, I assure my noble friend Lord Lucas that the current drafting includes wild plants, as well as wider aspects of farm-to-fork activity to be collected.
I turn to Amendments 177, 179, 180, 187, 191 and 192 on data collection. Some of the issues have been quite technical in this part of the Bill. I will endeavour to answer as many questions as possible but some might, perhaps, involve a more detailed response; I shall reply in writing on any outstanding points. The Government have taken deliberate steps to ensure that only information which fulfils a clear purpose can be collected. I agree with my noble friend Lord Caithness that this needs to be focused and proportionate—a point also made by my noble friend Lord Trenchard.
An exhaustive list of purposes is contained under Clause 23; the requirements for information must fulfil one of those defined purposes. Clause 24 sets out that, before an information requirement can be issued, the Secretary of State must publish a draft requirement and invite views over a four-week period from anybody who will be affected by it. Any views, including those about difficulties in meeting the requirements, will be considered by the Government before final publication. Clause 25(9) already ensures that, in circumstances where a proposal is made to disclose information in an anonymised form, consideration must be taken of how such a disclosure would affect commercial interests, including intellectual property rights. As regards information provided under a duty of confidence, a blanket provision would be inappropriate given that a duty of confidence could easily be established via a discretionary agreement between any two parties simply for the purpose of avoiding information requirements.
At Clause 21(5), the Bill includes safeguards to protect information subject to legal privilege. Clause 46(2) sets out that these powers cannot be used in ways that would contravene existing data protection legislation. The Government therefore believe that these safeguards are sufficient.
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Amendment 193 seeks to extend enforcement provisions to cover the individuals handling any data collected. Clause 26 exists specifically to create a means of investigating and dealing with a refusal to provide information. Once information has been collected, it is already protected by existing data protection legislation, and therefore the Government do not believe that further enforcement powers are required.
I should also say to my noble friend Lord Caithness that the Government held a series of discussions with industry stakeholders, including the NFU and the AHDB, to establish the current datasets available for agricultural markets and to identify where further information could improve supply chain transparency.
On Amendments 178, 181 and 182, the data required for the food security report is already available and will be drawn from a blend of national and international sources, such as the Office for National Statistics and the Food and Agriculture Organization of the United Nations. Clause 25(5) allows a requirement to specify that information is provided to a person other than the Secretary of State. This may include non-departmental public bodies and arm’s-length bodies, among others. However, it is important that the Secretary of State retains control over, and responsibility for, how these powers are used.
Amendments 185 and 186 seek to expand the definition of those related to the agri-food chain. The power already allows for information to be collected from anyone capable of affecting the agri-food supply chain. This drafting language was selected specifically with businesses such as hauliers and farm business suppliers in mind, as well as other relevant operators in the supply chain. In order to assess animal disease and wider risk-management tools effectively, the Secretary of State must have access to a broad range of data. It would hinder that aim if the definition of those closely
connected to the agri-food chain applied only to those negatively affecting certain aspects. In addition, the Food Standards Agency has robust and relevant powers in this area, and Defra and the FSA will continue to work together when needed.
Amendment 190 concerns the purposes for which data can be collected. The list of purposes contained in Clause 23 was drawn up after careful and detailed consideration with industry stakeholders. The purposes are drafted so that they can serve both current and future policy ambitions. We believe that narrowing the powers in the manner suggested would mean that auxiliary supply chain operators who hold crucial information, such as vets, contractors, fertiliser merchants and others, would be exempt from information requirements.
Amendment 194 concerns monetary penalties. Clause 26(5) specifies that financial penalties are to be calculated in a “specified manner” and clarifies that this means
“framed by reference to … profits, income or turnover.”
Issuing the same penalty to a farmer and a supermarket would clearly be inappropriate.
Amendments 195 and 195A concern the fair-dealing provisions in Clause 27. The introduction of contractual obligations across the whole of UK agriculture would, we believe, lead to provisions that fail to address the specific—I underline “specific”—problems of some sectors and introduce unnecessary bureaucracy in others.
The Government believe that each agricultural sector is different, that a targeted approach for each sector is most appropriate and that industry should be invited to provide its views. As such, an obligation to make regulations within 12 months of the Bill receiving Royal Assent may undermine the ability to undertake this necessary engagement. Indeed, on 24 June, a UK-wide consultation to explore contractual issues in the dairy sector was published. This consultation invites a broad range of views about future regulations and the most effective form of dispute resolution enforcement. The Government encourage all relevant farmers and processors to submit their response to this consultation and will actively listen to their views on appropriate enforcement mechanisms. The Government intend to repeat this approach for any future exercise of the powers within Clause 27, allowing feedback from industry to inform the final decisions made.
Amendments 195B to 195F and Amendment 196 seek to make changes to the approach adopted in Clause 27. The Government have designed this clause to be as flexible as possible, so that any obligations introduced under it can deliver appropriate protection. Following feedback from stakeholders on the Agriculture Bill 2018, for instance, the Government removed the link to the list of sectors in Schedule 1. The ability to account for the differences found between sectors is, we believe, important. For instance, while the dairy sector typically operates using formal written contracts, in the livestock sector and parts of the arable world, informal, word-of-mouth arrangements are more common. The Bill has the flexibility to regulate both kinds of relationships. With particular reference to Amendments 195F and 196, Clause 27(7) is a non-exhaustive list of obligations which may be introduced
under this clause. Where obligations are required which create a more balanced risk profile, or which deal with matters of animal welfare, the current drafting allows for this.
On Amendments 197, 198, 199, 200 and 207, I endorse all the points that noble Lords made about the work of the Groceries Code Adjudicator and all those who have been involved. This was created for the specific task of monitoring relationships between the UK’s largest supermarkets and their direct suppliers. This targeted focus and a good understanding of how the retail market works have proved critical in delivering effective change—a point made by the noble Lord, Lord Empey.
I say to the noble Baroness, Lady Ritchie of Downpatrick, that Defra and BEIS officials work very closely together on matters that affect the supply chain. BEIS and Defra together issued the call for evidence on extending the Groceries Code Adjudicator’s remit in 2016. A government call for evidence in 2016 on the GCA’s remit found insufficient evidence to justify extending it to indirect suppliers. I say in particular to the noble Baroness, Lady Humphreys, that the issues identified by the review were sector-specific, were predominantly concerned with the first stage of the supply chain and are best addressed with the targeted interventions in the Bill.
In response to my noble friend Lady McIntosh, I think, and the Government think, that the views of the farming industry will be critical in shaping these interventions. The Government’s current consultation invites responses about an appropriate enforcement regime. Having heard from many noble Lords around the House, I will make sure that the remarks that have been made across the House will also be fed into the department, and these will, of course, be considered before decisions are made.
In relation to statutory codes, I say to the noble Lord, Lord Empey, that the specific detail of each statutory code will be developed in consultation with industry and set out in secondary legislation. The codes will introduce obligations that businesses need to abide by when entering into a contract to buy agricultural products directly from qualifying sellers. I have more on that, and again my letter will set out more detail.
The noble Lord, Lord Grantchester, asked about the government department responsible for future codes of conduct and their enforcement. Codes of conduct introduced under the Bill are designed to protect farmers and growers. It is therefore envisaged that Defra will be the lead department responsible for managing the relationship with any future enforcement body regarding the codes introduced under Clause 27.
The noble Lord, Lord Grantchester, also asked about powers being used in a crisis. The problems experienced by sectors such as dairy during the recent Covid-19 pandemic were wider than just contractual practice. We will carry out sector-specific consultations, gathering views on which contractual measures would improve the resilience of the industry should similar situations arise in future. This will be undertaken through regulations. It could come under matters specified in Clause 27(7), for instance.
Amendment 201 relates to the recognition of producer organisations. Introducing into primary legislation extra conditions such as the one proposed risks placing further burdens on businesses interested in greater collaboration. We believe that in the livestock sector, where collaborative business models are likely to be comparatively small, a mandatory requirement to appoint a responsible officer for animal welfare would be disproportionately bureaucratic. But before the noble Baroness, Lady Jones of Moulsecoomb, becomes too disappointed, the kinds of specific conditions she is concerned with in Amendment 206 are most appropriately dealt with in regulations, in our view, rather than in the Bill. This will allow for consultation, during which animal welfare groups will be invited to express their views.
Amendment 202 seeks to remove the obligation to publish online a decision to recognise a producer organisation. I would like to reassure the noble Lord, Lord Carrington, that this is simply the continuation of an existing practice. No sensitive information pertaining to the producer organisation is published. A list of the names of active UK producer organisations is already available on the government website, and this will continue.
I found Amendment 203 quite technical. I looked at the amendment and the Bill and am happy to say that I will study any further follow-ups with even greater intensity. This amendment would preserve some elements of existing European Union law. The Government do not think it appropriate. The UK is leaving the CAP and should pursue its own objectives via domestic agriculture. Furthermore, we believe that preserving an element of EU law that is being replaced by a domestic equivalent, a new system of producer organisation recognition, could create confusion about how recognition is secured. As I said, if there is a more technical discussion to be had, I am happy to have it.
There was a question about why we had removed the agricultural exemption. We are not removing the agricultural exemption but amending it so that, in order to benefit from the exemption, the provisions of our domestic producer organisation regime must be complied with, instead of the objectives of the CAP, which I think responds to that point but in a slightly different phraseology.
Amendments 204 and 205 seek to remove the oversight role of the Competition and Markets Authority. I entirely appreciate the sentiment behind these amendments. The Government are committed to creating a simpler and less bureaucratic regime than the current EU one. However, the CMA is the expert authority on competition law in this country and it is right and proper that, where derogations from competition law are concerned, it retains the ability to provide its expertise.
Because of the range of issues discussed in this group, I will certainly look at Hansard, as I said, and see if there are any more technical points. I know the noble Lord, Lord Grantchester, has asked some technical questions and it might be helpful if I set out in my more detailed letter how we perceive the workings of Clause 27.
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As I said, work is in hand. I know that that is frustrating for noble Lords who want certainty, but the consultation will be first with dairy and then the other sectors. We are doing this because we recognise that we need to find the right way forward to ensure that the fair dealing provisions actually work for the farmer and the producer. If we fly into something and find that we are not working with the farming sector to achieve what is best, we will have missed a great opportunity.
I understand the point—the Groceries Code Adjudicator has worked very well, but my understanding is that the farming industry itself was not keen to have the adjudicator come in to deal with those situations. There is a feeling that the sector-specific arrangements will, in the end, suit the farmer and the producer better, and probably make it more accessible and nearer to the farm, as it were.
If there are any outstanding points, which I fear there may be, I will respond in writing, but I want to point out that fungi are an aspect of our ecosystem that is clearly important to our wildlife habitats and to the production of food. Given the reassurances about Clause 1 and Clause 22, I hope that the noble Baroness, Lady Bennett of Manor Castle, will feel able to withdraw her amendment.