Leaving the EU: Upland Farming

Jonathan Edwards Excerpts

Tuesday 26th June 2018 Westminster Hall

[Jonathan Edwards (Carmarthen East and Dinefwr) (PC)]

I beg to move,

That this House has considered the future of upland farming after the UK leaves the EU.

Dioch yn fawr iawn, Mr Pritchard. It is a pleasure to serve under your chairmanship and to lead this debate. I thank both the farming unions in Wales, NFU Cymru and the Farmers’ Union of Wales, for their help in preparing for this debate and for their overall contribution to supporting the farming industry in Wales and the wider rural economy.

Wales does not have a national animal in the way that New Zealand has the kiwi, Australia the kangaroo, Argentina the puma and South Africa the springbok. We have the splendid mythical Welsh dragon, of course, but if we were to have a living animal, a very strong case could be made for the sheep, or perhaps the ram. There are more than 10 million sheep in Wales, based on the latest annual survey, accounting for 33% of all UK sheep. That compares with human population of around 3 million, accounting for only 5% of the UK population.

The reason for the huge number of sheep livestock in Wales is the terrain and climate of my country. Wales is very mountainous and, as we know, even more wet. Some 82% of Welsh land is utilised for agricultural —purposes—an incredible figure when considering Welsh terrain—and 10% of UK agricultural land is in Wales. Agriculture contributes 400% more to direct employment in Wales than it does in the UK on average, if my reading of the British Government’s Brexit economic impact assessments is correct. With those statistics in mind, Welsh politicians should be extremely concerned about the likely impact of Brexit on this vital indigenous Welsh industry. We have far more to lose from a botched Brexit than other parts of the British state do.

The vast majority of farming land in Wales is designated a less favoured area. It is more suited to pasture than to arable farming. As a consequence, the Welsh farming model tends to be the traditional family farm based on livestock, rather than the crop-based farming that we tend to see in England.

In the late winter of 2010, before I was elected, I visited Mr Ian Rickman and his family at their Gurnos farm to undertake some work experience. Gurnos is high above the village of Bethlehem in the Tywi valley, near the Garn Goch. The Garn is one of the largest iron-age forts on the Brecon Beacons mountain range. It houses the monument to the late Gwynfor Evans, a national great, and the first Plaid Cymru MP elected to Westminster. He used to walk its slopes to gain solace and inspiration.

When I did my work experience, it was bitterly cold. The reality is that the only productive use of land at such altitudes is for sheep farming. During that experience, I gained a huge amount of respect for the sheep as an animal, but also for the families who endeavour to make a living out of hill farming. I assure you, Mr Pritchard, that there are far easier ways to make money and sustain a family. Let us remember that according to Welsh Government statistics, the average farm income in Wales is less than £30,000 a year.

These people, however, are from the land. Their families have worked the hills for generations upon generations, and have sustained a community, a culture, a language and a way of living that has lasted thousands of years. They have cultivated a natural landscape so beautiful that in 2017 “Lonely Planet” designated the north of my country one of the essential places to visit in the world. As beautiful as the north is, I would of course say that Carmarthenshire is best, but the critical point I am endeavouring to make is that the beauty of our country, and everything that goes with it, is not just something that happens naturally. It is the result of the work of the agricultural community and its livestock. Without that, Wales would not be the special place that it is; nor would it have the impact that it has, economically and socially.

Had I more time, I would have elaborated on the economic and cultural importance of agriculture, and its benefits for tourism, other sectors of the Welsh economy, and the Welsh language. My good friend Councillor Cefin Campbell, who leads for the executive board of Carmarthenshire County Council on rural development, has identified working with the agricultural community and young farmers’ clubs as a key cog in his strategy for regenerating the economy and preserving the language in Wales.

I realise that other Members want to speak, and I am grateful for the support I received before the debate from those Members, so I will move on. Farmers are a tough bunch, used to operating in a climate of fluctuating incomes and rapid market changes for their produce. European agricultural support has been the one constant in keeping their businesses sustainable. The European market is by far the biggest external market for Welsh agricultural produce, especially lamb. I have to say to the Minister that there is a huge amount of anxiety and foreboding about the future. I have held many meetings with farmers and unions since the Brexit vote, and anxiety is increasing as we move on. If this debate achieves only one thing, I hope it is that we can collectively begin to reduce those anxieties in the agricultural community.

We have to concentrate on three main areas that are vital for the future of hill farming: devolution, agricultural support, and trade. If it is the ultimate decision of the British Government to leave key European frameworks such as the single market, new frameworks of the territories of the British state will have to be created in their place to govern internal trade. I am not opposed to the creation of such frameworks, if the British Government do decide to shoot the economy in the foot by leaving the single market. Following Welsh independence, I would want the Welsh economy to be within a larger trading bloc; cross-border economic co-operation is a very good thing.

The key divide between Plaid Cymru and our Unionist opponents is that we believe that any common framework should be built and regulated by the four Governments of the state in co-operation—in a partnership of equals. Any decisions should be made on a shared governance basis, by a properly constituted UK council of Ministers, with a robust decision-making and dispute resolution process. They, on the other hand, believe that these matters should be decided in Westminster, and Westminster alone. That risks Wales becoming a permanent rule taker—or, as the Foreign Secretary might say, a vassal country within the British state. That risks English-specific frameworks being imposed on Wales, to the detriment of hill farmers in my country.

Admittedly, our position in Wales has not been strengthened by the contemptible capitulation of our country’s Labour Government, who accepted the changes. As Professor Tim Lang said recently in an evidence session of the External Affairs Committee of the National Assembly, when it comes to Brexit, Welsh interests are now “steamrollable”. As I said during a ministerial statement last week, the actions of the Welsh Government will go down as one of the biggest sell-outs in Welsh political history, and I can assure you, Mr Pritchard, that that is quite some achievement.

The 26 policy powers re-reserved by Westminster include vital agriculture-related policy areas such as agricultural support, fertiliser regulation, genetically modified organism cultivation, organic farming, zootech, animal health, animal welfare, food and feed safety, food labelling, public procurement, nutrition labelling, plant health and food geographical indicators. Welsh lamb holds EU-protected geographical indication status, of course, as does Welsh beef.

[Liz Saville Roberts (Dwyfor Meirionnydd) (PC)]

I thank my hon. Friend—diolch yn fawr iawn. Would he agree that it is time for the red meat levy—on animals that were reared in Wales but slaughtered in England—to come back to Wales, so that Hybu Cig Cymru can do an effective job on marketing that meat?

--- Later in debate ---

On resuming—

[Jonathan Edwards]

My hon. Friend makes an important point. It has been a bone of contention for the Welsh farming community for far too long that when products go over the border to be slaughtered, the levy is collected in England and not returned to us for the proportion of our products.

Welsh meat has an EU protected geographical indication, which is a mark of its quality and a vital marketing tool. Indeed, Hybu Cig Cymru considers the PGI to be of enormous economic importance to the Welsh red meat industry as it identifies the origin and unique qualities of our lamb and beef. Hybu Cig Cymru estimates that 25% of the growth in Welsh lamb exports between 2003 and 2012 can be directly attributed to its PGI status.

The Welsh Labour Government have effectively handed control of the issue to Westminster, despite the warnings of farming representatives. Of course, that is a Westminster Government who insist that only the Union Jack can appear on our driving licences, despite honourable exceptions in Wales who insist on having the Welsh dragon on them.

Concerns are not limited to Wales. The chair of Food Standards Scotland, Ross Finnie, expressed his concern in a letter to the Scottish Parliament. On the power grab, he said:

“However, if those matters are reserved to the UK Government to determine, it will be difficult for Scottish stakeholders’ voices to be heard, or for the needs of businesses or consumers in Scotland to be given priority.”

[Chris Davies (Brecon and Radnorshire) (Con)]

I thank the hon. Gentleman, my neighbour, for giving way. He mentioned the UK market framework, which most of the farmers in my constituency are pleased about. He also mentioned the Welsh Labour Government. The fear of farmers in my constituency is about that Government being in charge of farming—thank goodness that Westminster will be leading the way.

[Jonathan Edwards]

I fear the hon. Gentleman is continually getting mixed up. Nobody opposes the creation of common frameworks should we decide to leave the EU internal market. The key question is where power over those frameworks resides. Our approach is that this is a multi-polar state, so the four Governments of the UK should have a joint say. His approach, confirmed today, is that such matters should be determined only in Westminster. A serious political divide separates us, and the people of Wales can cast their view on that at the next election.

The second major issue is agricultural support. Since the formation of the common agricultural policy, hill farmers have received direct support, which constitutes a significant element of farm incomes. In Wales, 80% of total farming income comes from CAP, and Wales, which has 5% of the UK population, gets 9.8% of CAP spend in the UK, which equates to nearly £300 million a year. CAP is a key part of the EU’s seven-year multiannual financial framework, which gives great certainty in support at a time when market prices for produce are volatile.

[Luke Graham (Ochil and South Perthshire) (Con)]

Does the hon. Gentleman welcome the Government’s announcement that they will guarantee CAP payments until 2022? Since he mentioned Scotland, will he back the National Farmers Union Scotland, which supports the Government’s approach to have common frameworks but to allow the devolution of currently devolved agriculture matters to Scotland and elsewhere in the United Kingdom?

[Jonathan Edwards]

I am afraid that the situation in Wales is not as good as for English farmers, who have certainty until 2022—[Interruption.] I am not aware of the situation in Scotland, because I am a Welsh Member of Parliament. I am sure the hon. Member for Ochil and South Perthshire (Luke Graham) will accept that. [Interruption.] The hon. Member for Perth and North Perthshire (Pete Wishart) may address those issues.

[Mark Pritchard (in the Chair)]

Order. If Members want to make a contribution, they can intervene or speak. I ask those who intervene to be mindful that this is a very popular debate. I will impose a time limit once Mr Edwards ends his speech, and that is likely to be shorter if people keep intervening. I do not want to stop debate, but be mindful of other colleagues in the Chamber.

[Jonathan Edwards]

I am grateful for your guidance, Mr Pritchard. I will return to the issue at hand, Welsh farming.

In Wales, the situation has been compounded by the decision of the Labour Government of my country to reduce direct payments to producers by 15% by moving money from pillar 1. However, the point remains that CAP payments offer a degree of stability. While previously, under CAP, farmers did not have to worry overtly about the impact of Westminster elections on the amount of agricultural support they would receive, they could easily now face a situation in which a new Westminster Government could radically alter agricultural support policy. As we see from the power grab, the Labour Government of my country have abdicated all responsibility.

[John Lamont (Berwickshire, Roxburgh and Selkirk) (Con)]

Will the hon. Gentleman give way?

[Jonathan Edwards]

I will not give way. I will carry on, mindful of what the Chairman has said. While the British Government have promised to protect the current UK level of EU payments until 2022, the reality is that once we have left the EU, agricultural support will become an annual issue for the budget, or at the very best a three-year cycle under a future comprehensive spending review. There is no guarantee that current levels of funding for Wales will continue after March 2019.

We urgently need clarity for Welsh hill farmers, particularly about what the budget for agricultural support will be and how exactly it will be administered. Now that agricultural support has been re-reserved, I would be grateful if the Minister could outline how it will work for Welsh hill farmers. Will the Welsh share of agricultural support be based on our agricultural footprint, or do the British Government intend to distribute funds for Wales, Scotland and Northern Ireland based on Barnett consequentials?

During the referendum, the leave campaign argued that farmers would receive a dividend post-Brexit, because the UK would no longer have to make contributions to the EU budget. However, the reality is that there will be less money for Government investment post-Brexit, because the economy will slow and revenues will subsequently be less. Agriculture could find itself way down a long list of priorities for Westminster. Will the Minister outline what intergovernmental discussions have been held between the UK and the devolved Governments, and where exactly we are on getting clarity on the vital issue of agricultural support?

The third major issue is access to export markets. The European Union is a vital market for Welsh meat. Hill farmers inform me that approximately half of all their lambs are exported to the EU on a frictionless, zero-tariff basis, and 90% of all Welsh meat exports are destined for the EU. The EU is the largest global market for agricultural produce, and while the rest of the world is doing everything possible to get access to that market, the British Government are moving in the opposite direction. Preserving those markets is vital. It is sobering that some of the highest new tariffs are agricultural. The lowest that tariffs on lamb can be under WTO rules is 40%, and they are far higher if the product is frozen or processed in any way.

Admittedly, a comprehensive trade agreement with the EU could solve the problem, but while the British Government continue to maintain that no deal is an option, those of us who have concerns about the British Government’s negotiating strategy cannot be accused of scaremongering. We only have to look back to the chaos caused by foot and mouth. There was a collapse in market prices, a collapse in farm incomes and a host of other problems, all because farmers could not export to the EU. Impacts on upland farms were particularly acute. While such circumstances occurred due to a ban on exports rather than trade barriers, such impacts are worth bearing in mind when we consider the potential impacts of harder Brexit scenarios.

Now is the time to commit to maintaining tariff-free access to the UK’s largest trading bloc through our membership of the EU single market and customs union. That would ensure that our food producers could continue to export tariff free, that there would be no other barriers to trade and that already established, complex supply chains were not disrupted. The Farmers Union of Wales agrees. The president of the union, Glyn Roberts, said:

“Since the Referendum we have maintained that we should remain within the Single Market and Customs Union, and every day that passes brings more evidence supporting our view that at least in the short term, leaving these institutions would be a grave mistake.”

Our farmers are proud of the standard of their produce. They have some of the highest environmental and welfare standards in the world. If the British Government insist on dragging us out of the EU single market and customs union and pursuing free trade deals with third countries, it is vital that those standards are not compromised in any way, and that our markets are not opened up to substandard produce. It is essential that such matters are not regarded as exclusively within the remit of the UK Government and Parliament. As Hybu Cig Cymru chairman Kevin Roberts has said,

“Any future trade deal must take full account of the needs of the Welsh red meat sector.”

Ultimately, any future trade deal must be fully endorsed by the National Assembly, the Scottish Parliament and the Northern Ireland Assembly.

To close, agriculture, due to its complex supply chains and its prevalence in Welsh culture, is the backbone of the rural economy. It is vital, therefore, that the UK and Welsh Governments should do all they can to ensure its sustainability and success into the future. As the director of NFU Cymru, John Mercer, told me,

“Farmers were promised a bright and prosperous future after Brexit and it is now imperative that those political promises are upheld.”

Welsh hill farmers potentially face a perfect storm of hindered access to their main export markets and the opening up of the UK domestic food market to lowerstandard food produce. Policy makers cannot afford to get it wrong. With the clock ticking, it is time for Ministers to start coming up with some answers.

[Several hon. Members rose—]

--- Later in debate ---

[Jonathan Edwards]

Will the Minister confirm that, if the Government do not seek the endorsement of the Scottish Parliament, the National Assembly for Wales and the Northern Ireland Assembly on our trade policy, we will effectively have a situation in which those three constituent parts of the UK will have less power and influence over our trade policy than Wallonia has over trade policy at EU level?

[George Eustice]

I do not really think that that is the case. At the moment, none of us have much influence over trade policy, because it is decided by the European Union. I know that my colleagues in the Department for International Trade are working closely with colleagues in the devolved Administrations to work out a sensible approach to our future trade agreements.

My hon. Friend the Member for Brecon and Radnorshire (Chris Davies) is passionate about farmers in his constituency and made the important point that we need to carry farmers with us on this journey. I agree that we cannot deliver the outcomes that we seek without the support of farmers to deliver them.

We have had a good and comprehensive debate covering many issues, with powerful contributions from Members from every single part of the UK. I believe that these are exciting times as we face the future. We should see this as an opportunity, not a threat.

Question put and agreed to.

Resolved,

That this House has considered the future of upland farming after the UK leaves the EU.