Subsidiarity Assessment: Food Distribution (EUC Report)

Baroness Quin Excerpts

Wednesday 3rd November 2010 Lords Chamber

[Baroness Quin]

My Lords, like others, I begin by thanking the noble Lord, Lord Roper, and my noble friend Lord Carter of Coles for the work of the European Union Committee on this issue, and for the way that the subject has been introduced to the House. The noble Lord, Lord Roper, reminded us of some of the background considerations to the procedure that we will be adopting today, which are very much in line with the debate held last week on subsidiarity issues as a result of the committee’s report. It was the first time that this kind of procedure had been presented to the House. Furthermore, while the noble Lord, Lord Stoddart, and I often do not agree on European issues, I agree strongly that these provisions in the treaty are ones that should be used by national Parliaments. They were included to strengthen the role of national Parliaments in European scrutiny, so it is right that when either House of our Parliament feels that these issues are important, they should be fully aired and voted upon. Certainly, our own House of Lords committee has a very good reputation among national Parliaments throughout the EU for its scrutiny work. That is of long standing, as those of us who in the past were Members in another place or Ministers can testify.

Some of the considerations surrounding subsidiarity have been aired. It is felt it should come into play where legislation at EU level is unnecessary—although obviously the word “unnecessary” can be subject to different interpretations—where such activity can be promoted without following a legislative route and where it is better done by member states. As the Government put it in their Explanatory Memorandum,

“the EU should only act where there are clear additional benefits from collective efforts, or ‘EU added-value’, compared with action by individual Member States either individually or in co-operation”.

I believe therefore that the report makes a strong case. It is right to stress, as the noble Lord, Lord Roper, did, that the scheme is voluntary and that the United Kingdom has not participated in it since the mid-1990s. None the less, although we have not participated, as EU members we are fully entitled to make use of the provisions that are available today in making our views loudly heard about this.

I also accept the case in the report that confusion can arise from the parallel operation in a member state of a national scheme and an EU scheme. I also agree strongly that the extent to which purchasers from the market contribute to the objectives of the common agricultural policy in the way that is pursued at present is questionable.

When I first saw the committee’s report I was quite startled because, like others, I remember the circumstances in which this measure came into being. Like the noble Lord, Lord Teverson, I was also a Member of the European Parliament—indeed I was a member of the agriculture committee in 1987 when this issue first arose. I remember the senior role that the noble Lord, Lord Williamson of Horton, had in the European Commission at that time. As many noble Lords have pointed out, the circumstances then were very different from those of today. It was basically a measure to distribute high intervention stocks rather than purchasing food from the open market in the way that it has increasingly operated in recent years and seems likely to operate in the future.

I also accept the Government’s point that there are a lot of bureaucratic procedures involved in this process. It might be interesting if the Minister can say a little more about the costs of the scheme to those who choose to operate it and why that can be a disincentive to countries adopting the scheme in the way that it is currently provided.

I am glad that this debate is much more timely than last week’s debate. Because of the parliamentary Recess, the previous measure relied on the good will of the Commission to accept our view on subsidiarity. That is not a problem with this case, where we are in good time. I understand that, according to the Government, a final decision may not be taken until towards the end of next year. Perhaps the Minister can confirm that.

I agree that national Governments and also local and regional authorities are far more appropriate to deal with this kind of issue. I was glad that the noble Baroness, Lady Howarth, mentioned the north-east network in my own part of the country.

I hope that from what I have said so far it is clear that we support the work of the European Committee and support the Motions in front of us. The committee’s work is in line with the previous Government’s approach to this issue; there has been quite a history of consistency about this in the consideration in both Houses of Parliament in recent years. However, the House of Commons European Scrutiny Committee, which has also recently considered this subject, has injected one slightly different element into the discussion. This is perhaps worth raising here and asking the Minister to comment.

The European Scrutiny Committee in the other place comments that in its view the argument is more about competence than subsidiarity. The committee accepted that where intervention stocks are relied on for food aid the Commission is competent to act, because of the workings of the common agricultural policy, but where the food is sourced from the open market—as we have heard, that is increasingly the case—the link with the common agricultural policy is much more tenuous. Therefore there does not seem to be an appropriate legal base which would confer competence to act. This is an important point and it would be useful to get the Minister to comment on it. As I understand it, the Government have so far said that there may be an issue of competence, but that even if it was then ruled that it came within the Commission’s competence under the rules, there would still be an issue of subsidiarity. In that case, of course, the Government would strongly endorse the view of the European Union Committee in this House.

Could the Minister also say a little more, as other Members have encouraged him to do, about the support that we might receive from other countries in this area? In the letter that the Minister recently sent to the chairman of the European Scrutiny Committee, he talked about a small number of countries but certainly more than one—even though only one country has been mentioned here today. It would be useful for the House to be able to consider any further details that the Minister has about that. It would also be useful to know when the opinions of the European Economic and Social Committee and the Committee of the Regions of the European Union will be received and considered.

I noted that the noble Earl, Lord Caithness, saw at least part of the problem in a kind of grab for power and territory by the Commission. That might well be the case; however, the Commission makes the point in its Explanatory Memorandum that, as recently as 2008, 13 million people in the European Union apparently benefited from this scheme. Perhaps it would be interesting for the House to know where the majority of those people are. Is it in the new countries—the cohesion countries? Certainly, it seems that certain organisations and populations in the European Union were putting pressure on the Commission to continue this scheme, so perhaps it is slightly unfair to say, “It is just the Commission wanting to extend its territory”, although that may be an element in the equation. Also, has there been any pressure from charities in this country to participate, despite the consensus that seems to prevail that it is actually better to deliver such programmes nationally or even sub-nationally?

Finally, the Government make a strong case about this being a social measure and therefore not appropriate to the European Union. While I accept that argument on this occasion, I am sure that the Minister will not be surprised that I do not accept that all social measures are inappropriate at EU level. Indeed, to go back to the European Coal and Steel Community treaty of 1954, social measures were quite an important element in the help to the coal and steel community and to coal and steel-producing areas, so that actually has a long history within the European Union.

I note that, later on, the House will be looking at the European Social Fund after an excellent report that was also from the European Union Committee, so although our support for the Government’s stance on this occasion is genuine I hope that the Liberal Democrats in the coalition, despite the reservations about particular directives from the noble Lord, Lord Teverson, will none the less keep the pressure on the Government not to have such total hostility toward anything with a “social label” in the European Union. However, on this occasion, as happened last week, it is obvious that there is widespread consensus in the House and we are therefore happy to support both the work of the European Union Committee and its conclusions on this matter.

[The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Lord Henley)]

My Lords, I join other noble Lords in saying how grateful I am to both the noble Lord, Lord Roper, as chairman of the EU Committee and to the noble Lord, Lord Carter of Coles, as chairman of Sub-Committee D, for this report. I make it quite clear at once, as I think our Explanatory Memorandum made it clear, that the Government share the committee’s concern that the regulation concerned is not consistent with the subsidiarity principle. That means that much of what I say may repeat what other noble Lords have said this afternoon, because there has been general agreement around the Chamber. Still, it is important that it is on the record that these are the views of Her Majesty’s Government.

As the noble Lord, Lord Roper, made clear, the then European Community’s food distribution programme was introduced back in 1987 and its main aim was to help run down the stockpiles of basic commodities that had been purchased into intervention stores under the common agricultural policy. The noble Lord, Lord Roper, went on to stress that it was the stocks of butter, milk powder, beef, sugar, rice, all those mountains and lakes that we remember—I cannot remember whether it covered wine lakes, but it did cover a whole variety of mountains and lakes—that were released to charitable organisations in participating member states annually to distribute to poorer sections of the community.

As has been made clear by a number of noble Lords, we in the United Kingdom last participated in the scheme in 1998—everyone referred just to the mid-1990s, but I can give the precise date. We withdrew both because of the sharp decline in intervention stocks in this country and because of the high administrative overheads, for government and charitable organisations alike, which made participation unattractive. I assure the noble Baroness, Lady Quin, that we still believe that, under the scheme that is being looked at at the moment, there would still be high administrative burdens, which would make it unattractive. I also assure her that we are not aware of any charitable organisations having asked us to participate in this scheme, or, for that matter, to go back into the scheme after the withdrawal by the previous Administration back in 1998.

The main purpose of intervention systems, as my noble friend Lord Caithness and other noble Lords made clear, is to support market prices. However, a side-effect—in practice, it turns out to be the dominant effect—is to encourage overproduction and distract farmers from making market-based production decisions. Successive reforms of the CAP have reduced the role of intervention and, together with improvements in world commodity markets, have resulted in significantly reduced EU intervention stocks. Consequently, the Commission proposes to adapt the scheme.

The main stated purposes of the Commission’s proposals are to align the legislation to the Lisbon treaty and to modernise the scheme. The CAP is now more market-orientated and price support will play less of a role in future, so, as I have said, the accumulation of large intervention stocks is less likely. The proposal therefore provides for CAP funds to be used to purchase goods on the open market and for a wider range of goods to be purchased by participating member states on the basis of nutritional criteria rather than limiting them to the products for which intervention applies. The other major change is the proposed introduction to the scheme of cofinancing by participating member states. Under current proposals, this will be a minimum of 25 per cent of the eligible costs, with lower ranges of cofinancing, such as 10 per cent, applying to more disadvantaged areas of the European Community.

As before, participation in the new scheme—I think the noble Lord, Lord Roper, made this clear—will remain voluntary, so that, even if it goes ahead, the United Kingdom will not be obliged to participate. Providing effective help to disadvantaged people is clearly an important objective, but, as the Explanatory Memorandum explains, we remain unconvinced of the merits or the appropriateness of the proposal. In particular, we believe that the expansion of the scheme to procuring goods on the open market will mean that the new scheme is essentially a social measure—that is an assurance I can give to my noble friend Lord Caithness—which, by its design, would make it a matter for member states to decide rather than for the EU itself.

In accordance with the principle of subsidiarity, a longstanding element of European treaties that is currently enshrined in Article 5 of the treaty on the European Union, the Government consider that the EU should act collectively only where there are clear additional benefits, or EU added value, compared with action by member states either individually or in co-operation.

We consider that social matters are a matter for individual member states, and that measures to assist the neediest members of society are more properly and efficiently delivered through domestic social programmes that take account of the prevailing situation and available funding in individual countries. The noble Lord, Lord Carter of Coles, for example, mentioned a scheme, Healthy Start, which is run by the Department of Health. I assure him that that scheme is still there; it is under review by the department and subject to a consultation about various changes in it.

I would like to mention national charitable organisations, such as FairShare. I visited one example of its outlets in the north-east, not far from the former constituency of the noble Baroness, Lady Quin. Many noble Lords will know of the valuable work that bodies such as FairShare can do in distributing food to the less advantaged. To return to the north-east, I was grateful for what the noble Baroness, Lady Howarth, said about the north-east food action programme. It is those kinds of measures—national from the Government, from local government and from charities—that we believe we should be looking to work. I commend those bodies to those who do not know about the sort of work that they do.

The proposal itself was discussed in the Agriculture and Fisheries Council on 27 September. That was followed, as I understand it, by technical consideration by officials. A number of policy and technical issues have been identified. At present—I give this assurance to my noble friend Lord Caithness—there is no qualified majority in favour of it. There might be a blocking minority against, but certainly I assure him that no member state at the moment actually supports the scheme; some oppose it for one reason, some for another. Also, as I understand it, the European Parliament has not yet given its opinion on the proposal.

The noble Baroness, Lady Quin, asked about the timescale. I assure her that we still have quite a long way to go before we get to any final decision, what with the European Parliament having to consider it and some sort of qualified majority having to be found on the Council, which does not seem likely.

In addition to subsidiarity, there are two main concerns among those member states. First there is the legal base.

[Baroness Quin]

I thought that the proposal reflected some of the amendments that had been passed in the European Parliament, so I am somewhat puzzled that the Minister says that the European Parliament has not considered it.

[Lord Henley]

As I understand it, the European Parliament has not yet considered the stage that we are currently at. It might be that it considered earlier examples of it. At the moment we are at the stage where it has been through the Agriculture and Fisheries Council, which talked in September about co-financing at the 25 per cent or 10 per cent level, but that has not yet gone on to the European Parliament. If I am wrong, I will write to the noble Baroness to correct it. My point is that we still have quite a way to go before any of this gets through, which is why it is important that the views of this House and another place—and those of 26 other parliaments and all the Houses in them, should they wish, although we understand that only Sweden is likely to do this at the moment—should come forward so that we can reach various red lights, green lights or whatever, as appropriate.

I return to the concerns of the member states. First, I was talking about the legal basis. The new proposal is made under Articles 42 and 43(2) of the treaty on the functioning of the EU. This is similar to the existing scheme. These articles would be appropriate if the predominant purpose of the scheme was the supply of food from intervention. However, given the expected focus of the revised scheme on the purchase of goods on the open market, it is very difficult to argue that its predominant purpose is in line with the use of these articles as the legal base. A number of member states share our concern about that.

Secondly, the concept of cofinancing, which I referred to earlier, is strongly opposed by a number of currently participating member states that believe that the scheme, quite naturally, should be wholly community-financed. The Government believe that, were the revised scheme to go ahead, cofinancing would be very important to ensure that each participating member state reaches an informed judgment on how best to support its deprived communities, and because it would likely improve the governance of the scheme.

In conclusion, I emphasise that Her Majesty’s Government have not taken part in the existing voluntary scheme for many years and have no intention of taking part in the revised scheme if it were adopted. Given that there is presently no qualified majority on paper in the Council, there seems little immediate prospect of the proposal—at least in its current form—progressing that far. The effect would be that the existing scheme would continue to operate. I understand that there is a challenge before the European Court of Justice on whether the legal base for the operation of the 2009 programme is appropriate. That has yet to be heard. The point remains that it is not an activity that is best undertaken at EU level or, in our view, an appropriate use of common agricultural policy funds. Therefore, I stress that I welcome the committee’s report and support the Motion on the reasoned opinion.