My Lords, I declare my interests as set out in the register as farmer, landowner and a recipient of BPS payments and their predecessors for many years. I will speak to Amendment 37, to which the noble Lord, Lord Curry of Kirkharle, has kindly attached his name, and Amendment 40, to address the problem of the likely payment gap that will affect farmers as the direct payments are reduced in 2021, while the revenues from joining any new environmental land management scheme will not arrive until 2024.
I covered this in some detail in Committee and will not repeat that speech. However, the subsequent response from the Minister, the noble Lord, Lord Gardiner, and his office, together with the progress made on issues I identified at that time, has not made me rest any easier—indeed, the reverse, which is the reason this amendment has been tabled on Report.
First, we have no information on the cuts to BPS after 2021. Although promised for the autumn—which has arrived, of course—it might well be delayed until after the Bill comes into effect.
Secondly, we still have no real details on ELMS that would enable even elementary planning. Instead, during July Defra organised webinars for farmers to introduce ELMS. These were excellent and slick presentations of the concept but, when it came to the Q&A session with farmers afterwards, there were no answers to be had.
9.30 pm
Thirdly, there is the ongoing issue of Brexit and whether we have a trade deal with Europe. The consequences of no deal for certain important agricultural sectors such as sheep and cereals are simply too awful to contemplate. Duties of 40% on lamb exports, which account for a huge element of production, would devastate the industry.
Fourthly, we have few other trade agreements in place, and those we have account for some 12% of our trade, which drills down to a fraction of our agricultural exports.
Fifthly, there is the effect of Covid-19, which is consuming large amounts of government time and resources.
Given this situation, farmers cannot plan for the future and should not just exist on the warm words of future government announcements of support. Some of the warm words I have received are that farmers can still access old countryside stewardship schemes and take advantage of productivity grants. Some will certainly benefit from these, but they are not appropriate for all and certainly will not compensate for the income lost. Farmers surely deserve better than this.
This amendment enables the Government to proceed with the implementation of the new agricultural policy on its existing timescale, unlike Amendments 36 and 41, which also have substantial merit. However, it provides an all-important safety net of limiting reductions of BPS to individual farmers until ELMS are introduced. I understand that, in 2021, most farmers will receive 5% cuts, while the larger farmers would be cut by up to 25%. In circumstances where we do not know the cuts in succeeding years, for some farmers in less favoured areas, as the noble Duke, the Duke of Wellington, will point out, even a 5% cut can devastate their livelihood. Based on these percentages, in 2021 it is entirely possible that some farmers, both owners and tenants, will see their BPS cut by 40% to 50% before they have access to ELM schemes which might address some of the shortfall. This is both too uncertain and too severe for most businesses to plan around.
All noble Lords wish to see a thriving farming industry in this country and this amendment should help in this respect, particularly because the farming businesses likely to be most affected by the BPS cuts, according to the AHDB, are commodity arable producers and lowland livestock farmers, as these are known to be heavily reliant on direct payments. It would not, therefore, just benefit the large farmers. This enormous uncertainty should surely not be addressed by warm words or new schemes brought in at the last minute which add to the complexity of the industry. The Bill should incorporate this provision, which would help underpin the finances of farmers while all these uncertainties are resolved. I may therefore wish to press the amendment to the vote, to test the feeling of the House. However, this will very much depend on the Minister’s response to these concerns.