I am delighted to be able to speak to you at the conference of the organisation that for more than a century has been the voice of farming in this country.
Farming has long played an important part in my life. My family have been farmers and tanners for generations. As the MP for North Shropshire for fifteen years, I’ve worked closely with my local NFU. I know firsthand the vital contribution that farming makes to our economy, environment and society.
It was therefore a real privilege to be asked by the Prime Minister to take on the role of Defra Secretary. Since my appointment I have set out four clear priorities for the Department. They are to grow the rural economy, improve the environment, and safeguard both animal and plant health. You are key to all of these.
I must start by recognising what a tough year it has been. 2012 started with drought and the threat of stand pipes but ended up being the wettest year on record. The poor weather affected the sector as a whole, with livestock at increased risk from parasites and crop yields significantly reduced. The average wheat yield - just 6.7 tonnes per hectare - was the lowest since 1998. The wet conditions have also had a knock on effect on preparations for this year’s crop.
Further pressures on the industry have included rising input costs, bovine TB and Schmallenberg.
Charities, such as the Royal Agricultural Benevolent Institution, Farm Crisis Network and the Addington Fund, are to be commended for the work they are doing to help those facing genuine need and hardship. We are also talking to the banks to ensure they understand the pressures farmers are operating under.
On flooding, we must continue to work together. I am fully aware that rural water courses need to be kept clear and that there have been problems this winter. The Environment Agency is working with the NFU to look at how to make it easier for their local officers and farmers to take action to maintain watercourses, allowing for proper drainage. We’ve also made sure that our investment in improving flood defences doesn’t just focus on bricks and mortar. Projects completed last year provided an improved level of flood protection to more than 74,000 hectares of agricultural land.
Despite these difficulties, I am convinced that British farming has much to be positive about and will continue to rise to the primary challenge of producing more food. We must ensure that the British public have confidence in the industry and, in light of recent events, the food they are eating.
The substitution of beef with horsemeat in a number of products has shaken consumer confidence. It is totally unacceptable that anyone should buy something labelled beef and end up with horsemeat. That is fraud. I am determined that this criminal activity should be stopped and that anyone who has defrauded the customer must feel the full force of the law.
Food safety is a European competence. Under EU regulation 178/2002, food business operators have primary responsibility for verifying that food is of the right quality and correctly labelled. It is for food businesses to get out there and win back the confidence of their customers. That’s why, working with the FSA, I asked food businesses to carry out an unprecedented programme of testing for horse DNA. Out of 3634 tests so far only 35 have tested positive. That’s less than 1 per cent.
This is a Europe-wide problem. I spoke to Ministers from affected Member States, resulting in an emergency meeting with the Commissioner in Brussels. We agreed five points for action, the most important of which is Europe-wide DNA testing.
The FSA were the first national agency to go to Europol. I also met them in The Hague to discuss a coordinated response. At Monday’s Agriculture Council this issue was discussed in depth and it was agreed that all countries would share information through Europol.
I also urged the Commission to speed up its publication of its report on Country of Origin Labelling to the summer, so we can begin to discuss the details.
British food should be recognised for its rigorous traceability and standards. Our farmers and producers must not be tarnished as a result of the fraudulent activities of criminals.
British consumers need, and deserve, to have confidence in what they buy and eat. I would like to salute Peter and the NFU who, sometimes alone in recent weeks, have been grabbing the opportunity in the recent crisis to champion British farmers and their high quality systems of production.
Food and Exports
We will do whatever we can to ensure that farmers across the UK have access to overseas markets. Agricultural, food and drink exports were worth £18.2 billion in 2011 – the seventh year of continuous export growth.
There are some great examples of new markets that the Government has worked hard to open up. Russia has just lifted its ban on British beef and lamb imports in a deal potentially worth £80 million over the next three years. China has also opened its doors to British pork, enabling us to export the fifth quarter for which there is little demand in the UK, with a value of £50 million a year.
We are also working on opening up exports to the Middle East. David Heath, our Farming Minister, was in Dubai on Monday supporting companies looking to export their products to the region.
I recently met the Chinese Ambassador to follow up on my trade mission to China last year. I’ve also spoken with the Indian High Commissioner not only about food exports but also about working closely on agri-tech.
What farming does domestically is equally impressive. It successfully produces food for 64 million people and supports industries that add nearly £90 billion to the UK economy. The food supply chain accounts for nearly 4 million jobs and includes the largest manufacturing sector in the UK.
We currently import 22 per cent of food that could be produced here. For example, we have a £1.2 billion trade deficit in dairy products. 30 per cent of our raw milk output goes to making cheddar cheese. Yet we imported nearly 95,000 tonnes of cheddar from January to November last year.
There are other sectors in the same position, such as UK fruit and vegetable growers. We need to show consumers how great UK products are and encourage them to get behind the great British farmer, something I know the NFU is already doing through its “Buy British” campaign.
We also need to look to the future and embrace new technologies, with all their benefits from increased productivity to improving the environment. Indur Goklany has calculated that if we tried to support today’s population using the production methods of the 1950s, instead of farming 38 per cent of all land, we would need to use 82 per cent. It has also been estimated that the production of a given quantity of a crop now requires 65 per cent less land than it did in 1961.
This is why the UK Government as a whole invests over £410 million annually in research in the agriculture, food and drink sector. I am working closely with David Willetts, the Science Minister, on the Agri-Tech Strategy to support innovation and unlock the sector’s full potential.
The Strategy will look at how best to capitalise on the UK’s world class science and technology base to increase the competitiveness of the agricultural sector, as well as addressing the challenge of food security. We need to be able to encourage the take-up of existing innovative systems. To translate research into new products and processes. And take advantage of opportunities to export UK agri-tech skills and services.
There are some really exciting examples like satellite navigation coupled with crop mapping to guide the precise application of fertiliser or robotic systems for handling livestock to improve productivity and welfare.
Only last Friday, I was at Harper Adams University talking to some of the students who are developing some of these new technologies and promoting them abroad.
Last week saw the publication of the most recent statistics on the uptake of GM crops. It is reported that 170 million hectares of GM crops were grown globally in 2012, that’s over 12 per cent of the world’s arable land. A land area approximately 7 times that of the UK. This represents a 100 fold increase since 1996.
I recently met the Brazilian Agriculture Minister who told me that 90 per cent of soya grown in Brazil is GM because it is 30 per cent more cost effective. GM crops are now being cultivated commercially in Australia, Canada and South Africa. The rest of the world is ploughing ahead and reaping the benefits of this technology while Europe risks being left behind.
UK agriculture is a high-tech industry, and we need high-tech solutions to problems such as disease.
And that’s why the recent decision of BASF to withdraw their GM blight resistant potato from the EU regulatory approvals process should be a wake-up call for the whole of Europe: we must address the paralysis in the current system.
Tackling blight can require around 15 separate fungicide applications a year. The total annual cost to the UK of controlling this disease alone has been estimated at £60 million. So a blight-resistant potato could potentially deliver economic and environmental benefits simultaneously. Of course such product applications should be subject to robust safety controls – and that’s why the EU has a regulatory system.
I fully appreciate the strong feelings on both sides of the debate. But we shouldn’t forget that respected scientific opinion, including that of the European Commission’s own Chief Scientist, shows that GM crops pose no greater risks than conventional crops.
I hope that, collectively, we can work to improve market conditions for innovative GM product applications and give you, our farmers, access to all the tools you need to produce food as efficiently and sustainably as possible. That’s why we need to make the case for GM to the public, with a balanced understanding of the risks and benefits.
To be the lead innovators and increase our competitiveness globally, we need highly skilled, entrepreneurial and ambitious people working in our farming and food sectors. I welcome the industry’s lead in promoting itself to young people and supporting new entrants, with a number of initiatives already underway.
A few weeks ago I attended the closing dinner of the NFU’s Cereals Development Programme. It was great to meet so many impressive young farmers who wanted to make a difference to their sector and who, I have no doubt, will be industry leaders of the future.
We are also working jointly with industry to review the barriers and opportunities faced by new entrants. Led by David Fursdon, the ‘Future of Farming Review’ has already begun to examine these issues. I would urge you to feed in your views.
One thing government must do is to get out of people’s hair and let them get on with what they’re good at. You came into the industry to be farmers not form-fillers.
I am grateful to the Farming Task Force Implementation Group, led by Richard Macdonald, for conducting a “One year on” assessment. David Heath has already spoken about this. I want to reiterate that we will use this assessment to guide the actions we take to further reduce burdens on farmers.
I start from the position of trusting farmers. I am determined that we should move towards a system of “earned recognition”. Such a system would acknowledge that the majority of farmers adhere to high standards and ensure that those who do are rewarded by less frequent inspections. We need to work together to achieve this.
Since 2011, we are removing £13 of compliance costs for every pound added. There will be 12,000 fewer dairy inspections a year. But there is masses more still to do. There is no room for complacency. There are areas like movement of livestock that still require real work.
I am as keen as you are to make progress on the recommendations around livestock movement and ID. This is an extremely complex system. Simplification is important for Government and industry, both in terms of disease control and reducing burdens.
The RPA is responsible for many of these systems, as well as CAP payments. We have made good progress ensuring that the RPA is delivering a better service to farmers. It achieved its best ever performance in December paying out more than £1.4 billion to 97,000 farmers. We’re working on transforming the RPA so it continues to improve.
I believe that the current round of CAP Reform negotiations should have a major positive impact on the competitiveness of the UK farming sector. I’m pushing my EU colleagues to keep reform moving in the right direction, following the path set by MacSharry and Fischler. But we won’t get as far as I would like this time.
I was in Dublin a few weeks ago meeting Minister Coveney, who holds the Presidency. We are working closely with the likeminded countries in the Stockholm Group, such as Germany, the Netherlands and Sweden.
Unfortunately there are countries resisting reform. The recent amendments in the European Parliament are an illustration of exactly what we’re up against. At a time when governments across the EU are pumping money into stopping people smoking, it’s crazy to be even considering reinstating subsidises for the production of tobacco.
The European budget was agreed a few weeks ago. We don’t yet have a UK CAP allocation, but we do know that the overall CAP budget will be around €52 billion a year, the equivalent of around €1650 per second. A huge amount of money, which needs to be spent effectively.
I remain convinced that farmers’ decisions about which crops to grow and which animals to raise should be left to the market. Coupled payments and other subsidies are distorting, that’s why I want coupled payments limited to a maximum of 5 per cent. This is already happening, farmers have risen to the challenge, with over 90 per cent of EU support payments now decoupled. Pillar 1 direct payments will continue until 2020, but the Commission will insist on a greening element.
We are making good progress on this. No decision has been taken yet on how it will be implemented in England. What I’m seeking is the flexibility to take decisions that deliver an improved environment.
Above all I want greening to be simple for farmers to understand and easy to implement. I am determined to find a solution that works for farmers, the payment agencies and taxpayers. Never forget that the last round of reform cost us €550 million in disallowance – the EU’s word for taking our money back - because it was too complex. We must not let this happen again.
I do believe that there is a real role for taxpayer’s money in compensating farmers for the work they do in enhancing the environment and providing public goods for which there is no market mechanism. The budget agreement will allow us to transfer money from Pillar 1 to Pillar 2. This means that we can have more money to spend, supporting the long-term future of farming.
It is absolutely right to reward farmers for the part they play in managing and shaping our landscapes. This is particularly the case for areas such as the uplands, where farmers cannot prosper by producing food alone. The iconic British countryside is a real draw for tourists from around the world. We must make sure that we can capitalise on the benefits this brings to the rural economy. Rural tourism alone is worth £32 billion to the UK.
We all recognise that there is a massive challenge in reversing the long term decline in some of our farmland wildlife. I know that many of you are already doing great work to improve biodiversity on your farms. There is a real opportunity for us to work together in designing the next rural development programme.
CAP negotiations involve 27 countries and that inevitably means that we will have to accept compromises. However, I am pushing hard to ensure that the reform keeps moving in the right direction, is simple to understand and implement, and does not place further administrative burdens on farmers.
The competitiveness of the farming sector also depends for many farmers on the health of their livestock.
The biggest challenge facing us at the moment is bovine TB. In 2011, TB led to the slaughter of 26,000 cattle in England at a cost of nearly £100 million. In the last 10 years bovine TB has cost the taxpayer £500 million. This will rise to an estimated £1billion over the next decade if the disease is left unchecked. This is completely unacceptable.
Research in this country over the past fifteen years has clearly demonstrated not only that cattle and badgers transmit the disease to each other but that the culling of badgers can lead to a reduction of the disease in cattle if carried out over a large enough area for a sufficient length of time. We must also learn from the experience of other countries which shows that TB in cattle cannot be controlled without also bearing down on it in the surrounding wildlife population. In New Zealand, the number of infected cattle and deer herds had been reduced from 1,700 in the mid 1990s to fewer than 100 in 2011. This is a result of rigorous biosecurity, strict cattle movement controls and proactive wildlife management. A similar approach has been successfully deployed in Australia, the Republic of Ireland and the USA.
This is why I am committed to ensuring that the pilot badger culls go ahead in Somerset and Gloucestershire this summer. Today, Natural England has confirmed that these areas have met the final licence conditions.
We have also agreed with the NFU that an area in Dorset should be prepared as a reserve. This is a sensible contingency in the event that one of the existing areas is unable to proceed.
I would like to thank the NFU’s leadership, staff and members for the huge amount they have done to get us this far and their courageous public stance on this emotive issue.
Badger control is, however, only part of the solution. We will not achieve eradication of TB unless we continue to tackle cattle to cattle transmission too. That’s why cattle surveillance and control measures were tightened in January.
I fully appreciate that more testing and tighter rules on movements are really tough for livestock farmers. But the long-term health of the industry won’t be assured if we allow this terrible disease to continue to spread.
Like many people, I want to see effective and affordable cattle and badger vaccines deployed as quickly as possible. I would do that today if I could. But I cannot. As the EU Commissioner, Tonio Borg, made clear to me when we met in January, no one has done more in this area than the UK. Despite this, it is still likely to take a further 10 years before all the procedures for the deployment of a validated and legal cattle vaccine can be completed. We’ve started on the programme of action that the Commissioner has asked for but there are no shortcuts. That’s why going ahead with the pilot culls is so important.
We will publish a broad TB strategy pulling all of these strands together later in the year.
Sow stall ban
As well as tackling disease, we also need to look at animal welfare. It is vital that all EU countries apply welfare legislation, so that we don’t end up at a competitive disadvantage. That’s why I discussed the sow stall ban with the Commissioner in January and again on Monday, when he confirmed he’s started infraction proceedings on those Member States that are non-compliant. British pork is some of the best in the world, produced to some of the highest standards. We should not allow others to undermine that.
Animal health isn’t all about livestock though. Ensuring that we have a healthy bee population for pollination is crucial for the arable sector and our wider plant health. I want us to be led by the scientific evidence on neonicotinoids. I have asked the Commission to consider all the evidence and to wait for the results of our field trials, rather than rushing to a decision based on lab tests alone.
Before we take any decisions on neonicotinoids we need to have a full understanding of the economic and environmental implications, including what the alternatives are. It’s no use banning one set of substances if the alternatives bring their own problems. We must look at all the factors affecting bee health.
There’s no doubt that it’s been a difficult time for many farmers of late but I continue to believe that there are reasons to be optimistic. Not least the progress we are making on so many issues from exports to innovation and technology.
I am immensely proud that our farmers produce some of the finest food in the world, with the best materials to the highest standards and with rigorous traceability. We must champion that, instilling confidence in the consumer at home and abroad, enabling UK farmers to take advantage of the growing demand for high-quality produce.
There are, of course, big changes on the way, not least CAP Reform. That’s why it is more important than ever that we work together to enable farming to deliver for both the economy and the environment. If we do this I believe that farming in this country has a strong, vibrant and sustainable future.
British farming is a world leader – it is second to none. I look forward to working with you to keep it that way.