Current situation in agriculture & horticulture: October 2014 NFU Briefing
Circulation: NFU Council Date Issued: 8th October 2014
Andrew Clark 024 7685 8510
Current Situation for Council, 13th & 14th October 2014
Table of Contents
FOOD & FARMING ISSUES ...... 2 Livestock ...... 2 Dairy ...... 3 Poultry ...... 4 Pigs ...... 5 Combinable Crops & Seeds ...... 8 Sugar ...... 9 Horticulture & Potatoes ...... 10 Food Chain ...... 11 Farm Policy ...... 12 TB Eradication ...... 12 Hill and Uplands Group ...... 12 Government and Parliamentary Affairs ...... 13 POLICY SERVICES ISSUES ...... 14 Economics & International ...... 14 Rural Affairs ...... 18 Science & Regulation ...... 19 Land Management Services ...... 22 Knowledge exchange and sustainable intensification ...... 24 Industry-led Environmental Initiatives ...... 24 Single Payment Scheme (SPS) ...... 26 High Speed 2 ...... 32 Tenancy ...... 33 Environment ...... 34 Climate Change & Renewable Energy ...... 39 Legal ...... 41
The voice of British farming Although every effort has been made to ensure accuracy, neither the NFU nor the author can accept liability for errors and or omissions. © NFU
Current situation in agriculture & horticulture: NFU Briefing
Legal Assistance Scheme ...... 41 LAS Pilot Review ...... 44 Legal Panel Firms ...... 44 Tax ...... 44
FOOD & FARMING ISSUES
Livestock
1. NFU calls for a Ministerial summit on the beef industry led to a cross-industry meeting being held in early July. The NFU highlighted the damage to farming businesses from the rapid fall in farm beef prices, the changes to specifications and deductions that had taken place with little notice for producers, the need for retailers clearly differentiate and actively promote British beef on shelves and the urgent need for risk management options to help farmers deal with volatility. Since this meeting, the NFU has been working with the British Meat Processors Association on a code of practice to improve the transparency of terms and conditions and stop specifications changing at short notice, leaving farmers without a market. We have also employed a graduate trainee for a project on processor terms, conditions and charges and a report will be prepared containing proposals for the livestock board, Defra and AHDB by the end of October.
2. The NFU organised high profile, public facing events at agricultural shows this summer highlighting the pressure that farmers were under in the beef and sheep industries and the need for support from major retailers. A widely reported protest at the Royal Welsh Show outside the Tesco stand was convened following their decision to run summer promotions on New Zealand lamb. We have worked to remind consumers and retailers this summer that British lamb is plentiful, available and delicious and have received assurances from several retailers that they will have British lamb front and centre of displays in the coming months. The NFU have also continued to highlight poor practice on British beef and lamb sourcing using surveys such as EBLEX Beef and Lamb Watch. At the time of writing, the lamb price is around 10% lower than this time last year and below 2012 levels, largely on an increase in UK lamb numbers and carcase weights, increased numbers of out-of-spec animals being marketed and subdued demand. However, overall New Zealand imports this year are down and New Zealand export lamb production is forecasted to decline by three per cent, year on year.
3. The NFU launched a joint report with the National Sheep Association in July entitled “A Vision for British Lamb Production”. The report highlights the strengths and weaknesses of the sector and identifies the opportunities ahead and barriers that must be tackled in order to meet them. It is intended to provide a united front on our ambitions for the industry and will be used to frame and guide NFU and NSA activities to inform and convince policy and decision makers of the potential the sheep sector offers and what they can do to clear a pathway for its continued success. The NFU have already used it in discussions with retailers.
4. The NFU has responded to a consultation on pre-movement TB testing in SOAs, post movement testing in the low risk area, compulsory information at sale and fines for overdue tests. Although Defra will no longer permit movements further than ten miles in a SOA without a pre- movement test, following NFU lobbying, they will allow farmers to remove land over ten miles from the SOA to allow the remaining land to benefit. Defra continues to dispute that there is a need for farmers to set up interim SOA agreements between now and 2016 when the holding number system is due to be reformed. The NFU have surveyed members this summer and over 70% of respondents asked for interim SOAs within ten miles. We are also working with Defra on a project to provide better information to farmers on new TB breakdowns.
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5. The NFU have teamed up the Royal Agricultural Society for England (through the Innovation for Agriculture initiative) and Warwickshire Rural Hub to run a series of events focused on the next generation of livestock farming with a sheep event on 22 October at Moreton Morrell College, a beef event on 19 November, hosted by Adam Quinney and livestock conference at Stoneleigh Park on 3 December. All events are focused on using the latest technology across the supply chain to meet market demands, improve animal husbandry create more competitive farms.
Dairy
6. Dairy market. The most recent Global Dairy Trade (GDT) auction result (1st October 2014) saw all products on average fall by 7.3% to $2599/t. Indicating that downward movement in volatile global markets are continuing to impact on UK dairy farmers.
7. The biggest factor to impact dairy prices in the Europe and the world in the past ten years has been the rise in global dairy commodity prices to a point where intervention, no longer smoothes the EU market. We call this price phenomenon ‘price convergence’. This exposure to global prices, as a consequence of Arla paying a European price in the UK, meant farm gate prices are now above average in Europe, reached highs in the Spring and are now falling.
8. In 2012, the UK dairy industry and UK dairy farmers were posed with very different market dynamics to today. At that time, UK dairy farmers had the lowest milk prices in Europe. When commodities went up, UK farm gate prices were slow to respond and when they went down, farm prices dropped like a stone. In this environment, where the UK market was apparently managed as a microclimate within Europe, farmers naturally asked the question – if we’re not getting the full returns of the market, then we at least need to get a stable cost of production covering price.
9. Today, the conditions are very different, with UK farmers still getting prices better than much of Europe – we describe the market as tough but not dysfunctional. This is why the dairy board believe that improving the quality of farmers contracts, making the sector more competitive and working with processors to open up new markets – collaboratively, remains the best route to improving conditions to farmers in this volatile market place.
10. Part of the market dynamic to impact on dairy values, has been increased production. This has led to some calls within the industry to implement a co-ordinated voluntary market management scheme. The NFU maintains that supply constriction in the UK or EU, while the EU experiences global prices, would constrain UK producers, but could not significantly influence market prices.
11. Voluntary code review. Alex Ferguson has now published his findings, having been asked to review the voluntary code. Significantly for the NFU he has said the code is generally sound, requires little change and should be promoted to more milk buyers. He suggests that differential notice periods is appropriate to reflect the retention of buyers discretion to set price by private companies and that 30 days’ notice of a price cut remains appropriate. DUK have issued a statement stating that is agrees with most points, but not those which its members cannot find common ground on. The outcome of the review reinforces the importance of the code and work of the board to deliver it.
12. PSA cheese. In September Rob Harrison met with Copa and the European Commission to call for PSA provisions to include cheese (in addition to SMP and Butter). After successfully getting the aid extended, the European Commission has now taken a precautionary step to suspend the scheme for cheese. The Commission envisaged a scheme with about 155,000tonnes of cheese in storage for a 2 to 7 month period; however by the end of the first week Italy had already notified that it would put in storage 74,200t, which is 10 times higher than the annual export of its cheeses to Russia. PSA remains in place for butter and skimmed milk powder.
13. Princes Dairy Initiative. The NFU has been working with other industry parties to promote the benefits of the Princes Dairy Initiative, which is recruiting for its third year of the scheme. Page 3 Current situation in agriculture & horticulture: NFU Briefing
Recruitment of farmers has been looking for traditional family dairy farmers and will be offering support and business advice to those running small and medium-sized dairy herds. The Initiative aims to increase the diversity and long term sustainability of the British dairy sector by offering free practical workshops and an important local networking opportunity. This has been a good programme to be involved in as it aims for sustainability in the sector as well as giving us an opportunity to promote the benefits of NFU membership and bring some of our members into the fold with free help and advice. County Advisers and Group Secretaries have been very helpful in the recruitment of farmers and as we work with processors on this matter it helps to further build relationships, aside from everyday milk price working.
Poultry
14. Food Standards Agency (FSA) reporting of retail samples of fresh UK poultry meat. The first set of quarterly results was issued on 6 August. This showed a ‘no surprises’ result of 59% of fresh whole birds tested at retail level being contaminated with Campylobacter. This is broadly in line with the last retail survey in 2009. The main focus of media attention this time round centred on the ‘scandal’ and ‘cover up’ as the Daily Mail reported it on the front page of their 6th August newspaper referring to the FSA’s ‘U’ turn on the naming of retailers as part of the publication of results. The FSA agreed at their 22 July Board meeting that they would not publish the name of retailers for the first quarter’s result given the lack of data. This was greeted by the press as the FSA giving into pressure from the food industry. It was pointed out that Tim Bennett, Chairman of the FSA and former President of the National Farmers’ Union, used his casting vote in favour of not naming retailers. The BBC followed this report up by lodging a Freedom of Information request (FOI) with the FSA with a view, we believe, of identifying any examples of where the food industry had put pressure on the FSA not to name retailers. Correspondence between the FSA and the NFU was covered by the request. Given that the FSA now believe that they will have sufficient data the Q2 results – due mid-November – will include reference to the top seven retailers by volume. The consequence of all this is that the Q2 results are awaited with great interest (excitement) by the press and of great concern for the retailers for fear of being worse in terms of levels of Campylobacter levels than their competitors. There is very real retailer concern surrounding these results. The processors will not be named (this information will be provided when the full report is issued in June/July 2015). The concern for our members is that any bad publicity for a particular retailer will impact on the processor and the farmer suppliers in turn.
15. After sustained lobbying by the NFU, the Food Standards Agency (FSA) have made available funding that means that broiler farmers can now test for Campylobacter on their farms for free. An agreement between the National Farmers’ Union and the Food Standards Agency will see the roll-out of free on-farm Campylobacter test kits to independent broiler farms. This initiative is not for enforcement; it is essentially to raise awareness of Campylobacter. It will empower farmers to better understand their own flock status and to identify ways which may contribute to reducing flock incidence. This initiative will run until 31 March 2015 and farmers will be able to register their interest at www.act-nfu.org
16. Richard McDonald, former NFU Director General, has been named as the new Chair of the Joint Working Group (JWG) on Campylobacter taking over from Peter Bradnock, the former Chief Executive of the British Poultry Council. The JWG brings together all sectors of the food supply chain including the NFU, Defra and the FSA. The JWG has been in existence since 2009 and is the main body coordinating industry and research efforts to reduce levels of Campylobacter on fresh poultry. In 2010 Richard was appointed as a non-executive director on the Board of Directors of Moy Park, the second largest poultry processor in the UK.
17. “Poultry’s Dirty Little Secret” was the front page headline in the Guardian on 24 July. The newspaper exclusively revealed that an undercover report – aided by ‘whistle-blowers’ – found several practices being carried out in two poultry processing plants that were unlawful and risked the public’s health. In addition this gave the newspaper the opportunity to remind readers that two Page 4 Current situation in agriculture & horticulture: NFU Briefing
thirds of fresh retail chicken in the UK is contaminated with Campylobacter. The newspaper sought to remind readers about the extent of food poisoning from Campylobacter and that the FSA had decided ‘to shelve a promise to name and shame supermarkets and processors for their campylobacter rates. The climb down comes after “push-back” from industry and interventions from government departments’.
18. Poultry meat demand – has remained reasonably robust despite the headlines in the newspapers and the FSA’s ‘Don’t wash raw poultry’ messages during Food Safety Week (June). The independent poultry meat sector however has experienced a depressed market for the past four to five months. Over supply has been the root cause however, the negative headlines surrounding Campylobacter has not have helped. The independent sector accounts for approximately 20% of the poultry meat industry.
19. Beak Trimming. We have joined forces with the British Egg Industry Council (BEIC) and the British Free Range Egg Producers Association (BFREPA) and produced a beak trimming lobbying pack. The pack has been sent to all producers and contains all the details on how to go about lobbying MPs and the relevant points to raise including the all-important science/evidence based arguments in support of a continuation of Infra-Red Beak Trimming (IRBT). To date 130 MPs have been contacted by farmers as a result of the lobbying pack.
20. Stewart Houston of the Animal Health and Welfare Board of England (AHWBE) recently visited Board member Phill Crawley’s poultry farm to look at his untrimmed flock which is part of the University of Bristol trial. Stewart met the farm manager and her husband (who looked after Phil’s first untrimmed flock - 4,500 birds, depopulated in May) and they both impressed upon him the extra workload and anxiety associated with looking after untrimmed flocks. In terms of workload the manager estimated the split between the two flocks that she looks after, untrimmed and control, as 70:30. It was pointed out that this level of labour input could not be replicated or sustained if both 16,000 flocks were untrimmed. Stewart took on board the extra workload involved and the anxiety associated with looking after untrimmed birds. The uncertainty of looking after the flock and the worry that an outbreak of feather pecking could potentially be triggered by a number of causes – predators, hot air balloons, low flying aircraft and potentially a change in feed composition – were all explained.
21. The Beak Trimming Action Group (BTAG) meeting met on 21 July – Professor Christine Nicol of the University of Bristol updated the group on the progress of the trail. It was agreed that the Chairman, Steve Lister, would provide the group’s annual update to the Minister, George Eustice MP.
22. The All Party Parliamentary Group (APPG) for Eggs, Pigs & Poultry. Established in July 2012 the group is a cross-party body for Members of the House of Commons and House of Lords with an interest in the egg, poultry meat and pork sectors. The group was established to promote the industry and to raise issues of concern with Government and has the support of the National Pig Association, the British Poultry Council, the British Egg Industry Council and the National Farmers Union. Thirteen written responses were received in response to the APPG’s call for written evidence on planning, antibiotics and welfare which included the RSPCA. Dates have now been set in October for Select Committee style hearings with ‘witnesses’ called before MPs to give oral evidence. Once completed the APPG will write up a report with a summary, conclusions and any suitable recommendations. It is hoped that the MPs on the APPG will raise questions in the House to raise the profile of these important issues to the industry.
Pigs
23. Current prices – Affected by the Russian imports ban and oversupply in the market coinciding with a lack of demand, downward pressure on the UK pig price has been immense. Prices have dropped from 164.5p/kg to 155.1p/kg in the last quarter with the spot dropping from 168p/kg to 142p/kg. EU prices are even worse however with the EU reference price sitting at £125.3, so we expect to see the Page 5 Current situation in agriculture & horticulture: NFU Briefing
downward trend continuing into the autumn. Fortunately (for pig farmers) feed prices are still very favourable with the wheat price dropping over the same period from £137.9/t in June to £107.7/t on 30th September. CBOT Soya bean meal prices had remained relatively steady since the last report, but began to drop quite sharply from the start of September, and have moved from £289.8/t in June to £207.9/t on the 30th September (Source BPEX). We must continue to remind retailers however that most producers will have bought at least some of their feed forward at much higher prices than are currently available so will not all benefit, at least in the short term.
24. Confidential reporting service – NPA has introduced a Confidential Reporting Service that is available for Red Tractor assured members, to help maintain high standards of animal welfare on British pig farms, and protect pig-keepers from bogus claims by vegan activists who periodically attempt to gain unauthorised entry to pig buildings. It places an obligation on everyone employed on, or visiting, a participating pig unit to immediately report any disquiet they may have about any aspect of animal welfare, either directly to a senior member of staff, or using a confidential hotline. The service is operated independently by a specialist provider and is free to farm assured pig-keepers. It will be funded from the statutory pig levy, which is administered by BPEX, a division of the Agriculture and Horticulture Development Board. The service guarantees caller confidentiality, and can provide translation services for Eastern European workers on British pig farms. It will also filter out vexatious calls (if any). A poster will be prominently displayed on all participating pig units, giving the hotline number and advising all employees and visitors. In the event of being notified of any concerns about a pig unit, NPA will work with BPEX to determine a proportionate response, which may include asking Assured Food Standards to carry out a spot check using an independent auditor.
25. Trichinella – The UK should historically have been testing 100% of pigs slaughtered for Trichinella, which is a parasitic worm that can spread to humans through infected meat. However, since there have been no recorded cases of Trichinella in the UK since 1977, the FSA declared that only cull sows and boars and a percentage of finishers needed to be tested. The EU Commission had previously threatened infraction proceedings, although with a new risk based approach to pig meat inspection coming into force this year, less pigs across the EU will be tested, bringing us closer in line with other member states. As part of those proposals however, there is a new requirement for all pigs from ‘non-controlled housing’ to be tested for Trichinella. The FSA have interpreted this to mean pigs from free range or organic systems, and this will have a significant financial impact on those producers as many will send their pigs to smaller abattoirs which will not have the required testing facilities or the chiller capacity to hold carcasses until negative test results are received. NPA and BPEX are trying to find other solutions – working with AIMS and BMPA to facilitate collaborations between the larger abattoirs with testing facilities and the smaller abattoirs. The original June deadline was been delayed until October but there are still operations that are not ready due to lack of communication from the FSA.
26. Porcine Epidemic Diarrhoea virus (PEDv) – The number of new cases of PED in the US is expected to rise as we head into the winter months, and we are finding out more information about the disease all the time. Since the last update report, several new transmission methods have been discovered. Not only can PEDv be spread via feed from infected farms, airborne spread has been proven and semen can carry the virus if infected boars are viraemic (actively shedding virus) at the point of collection. The risk from infected boars however is more likely to come from fomite spread of contaminated materials around the farm since the viraemic period lasts literally for a few hours. Canada, who was hoping to gain freedom from the disease by November, has just had another case in Manitoba, highlighting the persistence and highly infectious nature of the disease. NPA continue to work with breeding and feed companies to minimise any risk of importing the disease into the UK. We are also working with other industry organisations and Defra on contingency planning and to determine whether the disease should be made notifiable or reportable in order to help us prevent spread should it get into the UK.
27. African Swine Fever (ASF) – New cases of this disease are reported weekly in EU countries bordering Russia and Belarus. The disease is still mainly spread by wild boar and back yard pig operations feeding swill, with one notable exception of a Danish run 20,000 pig place unit in Lithuania, Page 6 Current situation in agriculture & horticulture: NFU Briefing
and has now been reported in Estonia, Latvia, Lithuania, Poland and the Ukraine. Genetic sequencing of the viruses from Lithuania and Poland carried out at the EU Reference Laboratory in Spain has shown the isolates belong to genotype II and with 100% sequence identity to genetic marker regions from viruses isolated in the Caucasus and eastern Europe outbreaks since 2007 (Gallardo et al., 2007). The analysis is not yet fine enough to allow a more focussed study of the origin of disease incursions, but initial studies suggest more recent cases in Belarus and Ukraine in 2013 are closely related. NPA are working with Defra to look at messaging at borders and working with the industry to raise awareness and improve biosecurity protocols throughout the supply chain.
28. Outdoor pigs, CAP & greening – Defra have now confirmed that outdoor pigs will be classed as temporary grassland under the CAP reform greening rules. Therefore outdoor pig tenants on an FBT claiming their own basic payment (generally to protect the landlords total basic payment and to comply with the NVZ nitrogen limit) will only be able to qualify for an exemption from both crop diversification and 5% Ecological Focus Area if over 75% of the land rented is temporary grassland, which is generally not the case. However anecdotal evidence suggests that this could instigate a shift from FBT’s to grazing licence’s as landlords can now include the outdoor pig unit as one of their 3 crops within their rotation and simultaneously count the buffers strips etc towards their 5% EFA. Furthermore the recent announcement that dual use will still be permitted should provide even more security for those on FBT’s. NPA are currently investigating whether this positive perception is actually reflected on the ground.
29. Outdoor pigs and planning – NFU/Legal Assistance Scheme and NPA are currently supporting a member who is involved in a challenge by local residents on the planning approval of feed bins serving his outdoor sow unit. The local residents have argued for some time that due to the permanence of the visual impact of the unit on the National Park in which it is located, the entire unit requires planning permission. Although the NPA and the planning consultant concerned had negotiated and agreed with the National Park that the unit would not be required to apply for planning permission, local residents have now obtained permission to pursue a judicial review challenge against the Council’s decision. There is some concern that this could set a precedent with very serious and far reaching implications for not just the outdoor pig sector (which now constitutes 40% of the British breeding herd) but other extensive livestock sectors also.
30. EPR & the Bref – After requesting an update on progress, we have been informed that the final draft incorporating various member state comments is now due to be released mid-October at the latest, 4 weeks prior to the final working group meeting in November although these dates are still indicative and could change depending on progress. The Environment Agency will be attending a workshop in Berlin convened by DG Environment and the German Ministry of Environment in October on ‘BAT information exchange as the heart and driver of the IED’. One of Europe’s environment lobby groups will be presenting which is of concern.
31. Bioaerosols project – Following completion of phase 1 of the Environment Agency project to assess bioaerosol emission levels from ‘standard’ pig and poultry units, we have yet to receive the final report although initial conclusions suggest that levels of fungi and endotoxins (of most concern) are low. Therefore the EA team responsible are now in discussion with Public Health England to define the standard threshold with regards to distance from the farm. Funding for another 4 farms for phase 2 is now due to be approved, pending circulation of the phase 1 report.
32. Young NPA update – The Young NPA are preparing for their National meeting which will be held on the 11th December at the Farmers Club. The theme of the meeting will be International trade, and we have lots of interest already for it. Sophie Hope, one of our Young NPA members, has recently been appointed European Pig Producers UK branch Chairwoman, with the next Congress in Belgium in June 2015.
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Combinable Crops & Seeds
33. UK Harvest: good harvesting conditions in July and early August for rapeseed, winter barley and around half the wheat crop but for most of August limited progress. Quality for wheat has been good including very low mycotoxin levels. Milling wheat protein levels have largely been diluted by higher yields, so most samples will fall far sort of achieving £45/t premiums available for full specification wheat.
34. Markets: Cereal and oilseed prices still on a downward run, punctuated by occasional conflict fears in Ukraine. Over the summer the EU reintroduced import tariffs on feed wheat for the first time since 2010, and can be rapidly suspended if prices rise. These are variable, and are currently at around €5.00/tonne on low-quality wheat where tariff free quotas do not apply. Globally wheat stocks are estimated by IGC at around 27% of production, and soybean stocks 12.5% of production. HGCA report UK grain prices continued to decline with UK feed wheat nearby futures recently falling below £110/t for the first time in over four years, although closing at below £113/t on 6 October (over £225 in Nov 2012). Soybean prices have held better than rapeseed which were around £250/t (£362 12 months earlier), despite doubts over Australian and Canadian canola crop prospects.
35. Crop marketing: Campaigning and regulation and aimed at reducing speculator participation in grain futures markets has already driven most publicly listed banks out of EU wheat and oilseed rape futures trading leaving the space to private international shippers and funds. NFU has been responding in press and to EU regulators on their proposals that risk making futures and options markets much less viable and introduce significant barriers for farmers using them directly or through their merchant/cooperative that would make price risk management much less available for arable farmers. Rapeseed contracts issues: issue identified with one HEAR rapeseed merchant’s logistics charges may also extend to quality deductions where analysis for Erucic Acid has been disputed by growers, NFU LAS now handling Members’ Claims. Biofuels: The second reading of the European Commission’s Indirect Land Use Change (ILUC) Proposal is expected to begin in late November 2014. NFU achieved significant lobbying success in achieving a common industry position in response to the ILUC proposal. NFU are working closely with the Department for Transport to help achieve the RED target of 10% renewable transport fuel by 2020. Without a clear trajectory UK businesses are unlikely to continue to invest. After harvest, Ensus and Vivergo are now operating at full capacity; drawing up to 2.2 million tonnes of UK feed wheat annually between them, whilst producing renewable fuel and 600,000 tonnes of high protein animal feed. Vivergo continue to sell Dried Distillers Grains with Solubles (DDGS) into compounders rather than individual farmers.
36. Insect damage in rapeseed: Following difficulties establishing spring rapeseed and in the first season without neonicotinoids on winter rapeseed for several years, NFU has been gathering case study evidence from Members including photographs of cabbage stem flea beetle damage to rapeseed crops. Other organisations are collecting crop damage assessment data across the UK via agronomists. Syngenta withdrew the application for farmers to access neonicotinoid seed treatment for winter rapeseed this summer after political indecision by government delayed final approval to a point where logistics would have been a severe constraint to treating and reporting on use of any reasonable area of sowing. Defra eventually approved three neonicotinoid products, one for cabbage stem flea beetle. Emergency use Approval on Aceteamiprid (Insyst) for aphids and CSFB and label extension for thiacloprid (Biscaya) and flonicamid (Teppeki) for aphids. NFU believes that approval should have been announced much earlier in the season and we wish to establish a performance standard with CRD and Defra to clarify emergency authorisation timescales in future, as products useful to a wide range of sectors are already affected and disadvantaging Members unnecessarily (e.g. Asulam in bracken control, neonicotinoid seed treatments in biodiversity mixes and fodder crops). Government also wished to discourage farmers from obtaining and using Measurol seed treatment, which was legitimately available if processing took place in France. NFU agreed to promote stewardship of treated seed. Page 8 Current situation in agriculture & horticulture: NFU Briefing
37. Inputs: Grain prices are falling fast, fertiliser prices are now rising with very little tonnage moved to farms or even committed by farmers. According to manufacturers this is the result of supply and demand. AN antidumping: In early June 2014 the Commission began to indicate that it may continue the €47/tonne penalty on imports from Russia. NFU arranged to lead a delegation of six Member States at a DG TRADE Hearing to give evidence in mid-June 2014, and met officials from Defra and BIS to make the case on behalf of farmers as an interested party. The antidumping duty was re-imposed at between €28-€47/tonne in September 2014. Other options are in development for NFU to pursue removal of tariffs (between 3.8 and 6.5% on imported P and N fertiliser). Seeds: NFU will submit evidence to the European Commission on suggested amendments to Seeds Marketing legislation currently being reviewed as a broader part of the five part package. NFU have in the past called for simpler and more flexible legislation on seed availability during times of shortage and to accommodate changes in business structure. The inclusion of the Plant Variety Rights (PVR) legislation in the review will form the third pillar of the Combinable Crops submission. It is expected that the new draft text will be presented by the Commission in the early part of 2015.
38. NFU have worked with Defra on contingency planning in the event of seed shortages as seen in 2012/13, as well as following floods in 2014. However traders and seed breeders have failed to sign up to the document, suggesting there have been no problems with seed distribution. NFU have reported the prospect of further shortages of legume seed, following the decision by Defra to allow nitrogen fixing crops to contribute towards meeting on farm EFA. NFU are now working with PGRO and Defra to ascertain the levels of shortage in the UK.
39. Looking forward: The NFU and Openfield Cereals Development Programme saw 45 applicants for 15 places. This second season of the programme will offer young arable farmers the opportunity to experience the cereals and oilseeds supply chains, while raising awareness of the work of the NFU and develop members who will in future hold key roles and responsibilities throughout the supply chains. Meetings and visits commence on 21st October.
Sugar
40. The 2014/15 campaign began on the 12th September with all factory sites slicing beet by the 17th September. The expectation following annual root dig samples is for a significant increase for the national beet yield this year. Total sugar production over the campaign is currently predicted as 1.5m tonnes, 150,000 tonnes more than last year. Growers will be paid £31.67 for CTE and ICE beet, with surplus priced at £25 per tonne.
41. NFU completed negotiations with British Sugar on the 2015/16 beet contract in July, with the price for both CTE and ICE beet agreed as £24/tonne. The price was announced alongside options for growers to take a one-year contract holiday on all or part of their entitlements and the announced objective of British Sugar of reducing cropped area by 20% as a measure to limit the continued build-up of sugar stocks. With 11% offered under the contract holiday, a compulsory contract cut of 9% across contracted area for 2015 has subsequently been confirmed to all growers.
42. The NFU have written to growers reinforcing the need to review cropping plans in light of the contract area reduction, low surplus price and the accompanying agreement secured by the NFU in negotiations of a relaxation of the performance rules in 2015.
43. The NFU secured a substantial increase in the transport allowance payable to growers as part of the 2015 contract negotiations. From 2015 growers will receive the true costs of transport and the additional cost of cleaning and loading as their allowance. In addition a new working group to review the logistics operations in the sugar sector has been agreed as part of the package of negotiations. Issues around inefficiencies and problems in the current logistics system have been raised by the NFU for some time and were clearly identified in the recent IPA working Page 9 Current situation in agriculture & horticulture: NFU Briefing
groups at each factory. As part of their commitment to the work to review beet logistics British Sugar
44. Applications for the Sugar Industry Programme are now being taken. The highly successful programme now in its fifth year will give an opportunity for young growers and sugar industry professionals to learn more about the sector including how research is conducted, the representation of growers in Westminster and Brussels and the factory supply chain. Potential candidates should contact Emma Mundy. Full details are available at http://www.nfuonline.com/sectors/sugar/latest-news/sugar-industry-programme-2015/
45. The 2014/15 frost insurance policy has been confirmed by NFU on behalf of growers. The full policy details will be posted on the NFU Sugar website for reference with certificates of cover and a summary of the policy posted to growers during October. No changes have been made to the policy this year. British Sugar have again agreed to pay the premium cost to the NFU direct, avoiding the need for invoices sent to growers.
Horticulture & Potatoes
46. Following the abolition of SAWS in December 2013 the NFU established a labour monitoring tool to gather evidence on the supply and demand of seasonal workers in the horticulture and potatoes sector. The tool will also enable us to build a national picture of the level of turnover, length of work placement, and country of origin for overseas workers for the 2014 season. A panel of respondents have been invited to input recruitment data on a monthly basis. The view of the majority of the respondents is that labour supply has been sufficient to meet demand over the period May - July.
47. The NFU will be chairing the policy impacts and benefits working group of the Ornamentals Roundtable, set-up by Minister Lord de Mauley in September. The Roundtable will discuss how to overcome barriers to competitiveness and growth in this sector of the industry, and due to deliver an action plan by April 2015.
48. The NFU will be re-launching its Audit Pack and the Potato Sellers Checklist in November. The Audit Pack is a valuable tool, free and exclusive to NFU members, to help meet requirements of Red Tractor Fresh Produce Audits. The pack is being fully revised to take account of updated RT standards and new coding structure. The Potato Sellers Checklist has been improved to offer members more sound and practical advice on what they should consider before entering a contract, as well as some guidance on what to do if they have a dispute, taking into account situations during poor quality years (such as 2012) and high volume years (such as 2014). The checklist will be on the agenda, alongside Nematode Stewardship, CIPC stewardship, Tesco Fresh Produce contracts, PCL market update and WRAP’s Product Sustainability Forum, of November’s NFU Potato Forum meeting at NFU HQ, Stoneleigh.
49. The NFU has responded to a Natural England consultation on the use of non-native commercially-reared bumblebees for pollination. The consultation is selective its use of evidence and fails to consider the greatest risk for growers – lack of pollinator availability. NFU is working with industry stakeholders and asking Natural England and Defra Ministers to re-think their approach.
50. The NFU has discussed with Defra, RPA and other industry stakeholders, the EU Fruit and Veg aid packages created in response to the Russian trade ban. After the first scheme became quickly oversubscribed, the NFU’s priority has been to ensure the second scheme is administered in as fair a way as possible for UK growers. The NFU will renew discussions with retailers to seek assurances that commitments to British-grown produce will be kept over coming months as the price of imported produce continues to decrease.
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51. Members of the NFU Horticulture & Potatoes Board provided evidence to support the NFU’s call to allow ‘spring’ and ‘winter’ vegetable crops to be recognised as part of the CAP crop diversification requirement. Discussions are ongoing, but the evidence provided by NFU members has proved critical in persuading Defra/RPA of the principle behind this request.
Food Chain
52. The Food Chain Unit (FCU) continues to support sectors across work streams including; general retail and supply chain engagement, labelling, GM, organics, assurance schemes and European Food Chain issues (with BAB).
53. New origin labelling regulations stipulate that only information relating to where an animal was reared and slaughtered will be made mandatory. The new legislation has the potential to mislead consumers by not safeguarding the use of flags and other marketing claims on origin of meat. It’s clear to us that ‘reared in the UK’ has the potential to fool customers into thinking they are buying a British product when they might not be. The FCU is working to ensure that those retailers and food companies in the UK that have already signed up to a Voluntary Code of labelling committing to born, reared and slaughtered continue to uphold their arrangements. The FCU is continually working to address the issue in Defra and especially as the ‘Meat as an Ingredient’
54. Education - The food chain unit is working with other bodies in the industry (AHDB, British Nutrition Foundation and FACE, amongst others) to enhance the quality and quantity of information primary and secondary children receive from the school curriculum, in relation to food and farming. The FCU is also embarking on a scoping exercise to enhance the quality and quantity of information that trainee chefs receive at catering colleges, where currently there is little sourcing or primary production focus.
55. British Food Plan and Government buying standards. The FCU is extensively involved in providing input, advice and guidance to the 'British Food Plan'. Headed by Peter Bonfield, the plan, instigated by Owen Paterson, aims to increase the amount and standard of food procured by the public sector that meet and exceed UK production standards. The plan has set up numerous working groups, on which the FCU sit. The Government buying standards are being revamped to reflect the work of the British Food PLan. The main lobbying point is ensure that Red Tractor standards are set, at the very least, as minimum standards by both the British food Plan and Government buying standards
56. Organic regulatory proposals – The proposals put forward seek to introduce more stringent production rules for farmers, many of which are unachievable in the UK. Some key aspects we are concerned about at this stage are: no allowance to run a mixed farm holding for products to qualify as organic, ban on dehorning, increased localisation of sourcing animal feed and a requirement to purchase 100% organic seed. The FCU has attended working party meetings at Defra, BEIC and COPA to derive the best possible outcome for UK farmers. An initial position statement has been derived at COPA level which declares the proposal should be rejected in its entirety if certain key areas of the proposal are not revised substantially.
57. The FCU continues to consult with Defra, FSA and industry stakeholders on the Elliott Review into the integrity and assurance of British food supply networks. The Elliott Review was appointed by the government in response to the horse meat scandal of 2013. The review, published in September 2014 makes a number of recommendations which the current government has endorsed. Of particular interest is the establishment of a Food Crime Unit based within the FSA. The FCU has been keen to stress that farmers were not responsible and implicated as a result of the horse meat scandal. Therefore, any costs or further regulation associated with the recommendations should not be at the expense of farmers and primary producers. We have received assurances that all extra resource costs will be met within existing government
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budgetary requirements. However, we will continue to monitor how government commitments progress and defend our members from unnecessary burden.
58. The FCU continues to participate in its role sitting on the expert Hospital Food standards panel which will deliver recommendations to improve procurement practices and quality in the delivery of hospital food. The plan was instigated by Dan Poulter, with one of the key drivers being to ensure that money spent on procuring hospital food, supports as much as possible, the food supply chain in this country.
59. The FCU is carefully handling reports of GSCOP breaches from NFU members through the online survey. The team continues to promote the use of the NFU survey as a way for members to report potential breaches anonymously. Additionally, the team has been liaising and challenging retailers where they are seeking to introduce new charge mechanisms to their supplier base.
60. The FCU is in regular discussions with Red Tractor Assurance, and continues to promote RTA and is speaking to industry representatives and stakeholders across retail, branded manufacturers, wholesalers and food service businesses to maintain momentum and address any third party concerns relating to the Scheme and logo.
Farm Policy
61. The overriding priority of the Farm Policy team has been assisting the two culling companies; HNV and GlosCon Ltd. deliver a safe and effective badger culling operation. The team continue to hold regular meetings with Defra, Natural England, AHVLA, the Home Office and Police to ensure all operations are conducted in line with the best practice guidance, and all reporting and licence obligations are met.
TB Eradication
62. While much of the focus has been on the pilot culls, the NFU has been working on a number of fronts to ensure delivery of all aspects of the Government eradication strategy. The message about the importance of a comprehensive eradication strategy, including wildlife control, has been taken to all party conferences and discussions have been held with Defra Ministers and officials about further roll-out. We have responded to the consultation about changes to the cattle movement and testing regime and supported edge area vaccination projects in appropriate locations.
Hill and Uplands Group
63. Defra have now mapped all SPS claimed common land, and will now release the maps, including Permanently ineligible Features (PIFs), and commoners will either be able to visit a local office or, for smaller commons, receive a map in the post to comment on. Past experiences of mapping common land have shown that this is likely to be a fraught process, and we are working to ensure payments are not unduly delayed.
64. Discussions surrounding burning of moorland and heath have moved in a more positive direction, following feedback from pilot work to the Natural England Board. It is hoped that a consensus pursuing 5 interlinked outcomes - biodiversity, water, carbon, sheep and grouse can be reached; and will involve the use of burning as part of a recovery plan for degraded areas, and reduced in areas of functioning blanket bog. However, there are still likely to be conflicts, not least around the definition of functioning blanket bog and between degraded bog and peatland.
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Government and Parliamentary Affairs
65. UK general election May 7th, 2015 - the NFU have established policy areas for our manifesto, which was launched in September 2014. Please contact us with any further policy ideas as the manifesto is an evolving document and ensure that you start to engage with MPs and prospective candidates during this important period. County advisers should aim to make contact with all MPs and candidates of all main parties and set up constituency based hustings with members from this autumn. Contact the GPA office if you need help identifying candidates or constituency boundaries.
66. The GPA team worked with the HQ advisers to write and prepare the NFU 2015 General Election Manifesto which was approved by Policy Board in July. The NFU 2015 Manifesto was launched at a press event in Smith Square on September 17th.
67. The period since June Council has been dominated by summer recess in the run up to the Party Conference season.
68. On-going legislation that we are monitoring and briefing on includes the Infrastructure Bill, Water Bill, and the ongoing HS2 Hybrid Bill (see Land Management Services report). We hosted a lobby by affected members of their MPs in Parliament on the first day of the Second reading of the HS2 hybrid Bill.
69. GPA staff have attended fringes, debates and events at all three main political Party conferences.
70. The GPA office organised and ran a series of well-attended NFU fringe events; the NFU fringe meeting at the Labour Party Conference in Manchester drew over 100 attendees; the NFU fringe meeting at the Conservative Party Conference in Birmingham attracted over 175 attendees. The GPA office are organising and running a NFU fringe meeting at the Liberal Democrat Party Conference in Glasgow on October 6th 2014.
71. We have also used social media more to promote the Party Conferences through blogs, Twitter and on Facebook.
72. The GPA office continues to distribute its Political lobby brief to assist regional staff and members when meeting with MPs. The brief focuses on key issues which are likely to be at the forefront of political debate around food and farming policy.
73. The NFU’s Government and Parliamentary Affairs team continues to monitor and brief MPs and Peers on a range of issues being debated in Parliament. The ‘Weekly monitor’ of monitoring MPs and Peers questions and debates on NFU related issues now regularly runs to thirty or more pages per week. In the third quarter of 2014, the Government and Parliamentary Affairs team have produced briefs for MPs and Peers on a large range of issues, including those on: Renewable Energy, Organic Food, Role of Agriculture in the rural economy (individual briefings for several peers), Implementation of CAP in England, Rural Economy, Antibiotic Resistance, Infrastructure Bill, Fly-grazing, Bovine Tuberculosis, Badger cull pilots and HS2.
74. We continue to contribute heavily to monthly Oral Defra Questions, supporting MPs in quizzing the ministerial team on a range of issues relating to food and farming, and have contributed to monthly DECC, CLG, DFT, Bis, Welsh, Culture media & sport and Home Office oral questions.
75. The GPA staff have had several meetings and attended events with the Labour shadow Defra team and met with their new special advisers to brief them on topical issues. Page 13 Current situation in agriculture & horticulture: NFU Briefing
76. The GPA team have attended All Party groups on APPG Game & Wildlife conservation: dredging, APPG Hill Farming, APPG EU-US Trade & Investment: TTIP & the Ag sector, APPG Animal Welfare & APPG Agro-Ecology: Farm Animal Welfare Codes and the Efra Committee: Horse Welfare.
77. The NFU’s Government and Parliamentary Affairs team continue to welcome visits from NFU members and have addressed both internal and external groups on lobbying tactics and an induction to Parliament. We continue to host NFU branch visits (Cambridgeshire and Devon), along with inductions for new NFU group secretaries, NFU staff and county advisers. We have hosted a visit from the Vietnamese Farmers Union and Japanese researchers.
78. The GPA staff ran a lobbying training day for advisers at HQ in September.
79. A general election manifesto lobbying training session is being held for Group secretaries in Durham and York on October 8th and 9th.
80. Members and staff are encouraged to get their MP to sign up to the Back British Farming Charter. MPs and Peers signed the Charter at a reception in Parliament.
81. The NFU Westminster lobbying and monitoring resources can now be found in a more user friendly format on the New NFU Westminster pages.
82. As part of the wider NFU social media strategy, the NFU Westminster team are promoting the NFU Political twitter account, with an increase of over 300 more followers to 3,085.
POLICY SERVICES ISSUES
Economics & International
83. Next Generation Policy Forum: The first meeting of the new group of the Next Generation Policy Forum took place in July at Stoneleigh Park. During the morning session, we gave the group an idea of what is the NFU, its structure and what it does for its members. We selected a limited range of topics based on their expressions of interest and we listened to the Forum’s views both in terms of their needs and take on policy. In the afternoon, we had discussion on the Forum’s priorities and areas they would like to work on. We agreed that the group should start reflecting on the future CAP post 2020. Therefore the economics team circulated a questionnaire to stimulate some thoughts and a debate for our next meeting in London at the end of October. We are interested in hearing the Forum’s views on what should be maintained in the next CAP, what should be changed, what could be improved and what is not currently working. The responses will contribute to a reflection paper on a vision for CAP post 2020 that will be discussed with the relevant national boards and ultimately with Policy Board.
84. Trade: TTIP The seventh round of EU - U.S. negotiations on the Transatlantic Trade and Investment Partnership (TTIP) agreement took place in Chevy Chase, Maryland from September 29 – October 3, 2014. At the end of the round, chief negotiators commented that the two teams had a week of productive discussions. “Negotiations are now moving smoothly into the textual phase, where discussions are based on specific textual proposals.” No major outcome was expected from the conclusion of this round due to the American mid-term election in November.
85. CETA EU and Canadian negotiators agreed the final text for the EU-Canada trade deal. The consolidated text runs to 1634 pages and covers subjects such as market access, country of origin labelling and product standards. The agreement will enter into force two months after the respective sign off processes are complete. For the EU, this means approval by the Member States and the European Parliament. This process could take at least 12 months and is unlikely Page 14 Current situation in agriculture & horticulture: NFU Briefing
to be before start 2016. The Canadian deal is heralded as a success and model to follow. Canada is one of the most developed non-European countries with which the EU has ever negotiated a trade agreement of this size. The agreement is expected to increase trade in goods and services between the EU and Canada by nearly a quarter, lifting EU output by about €12 billion a year.
86. UK beef and sheep exports to North America. Defra submitted the Self-reporting Tool on 4th July this year. The next official step is an inspection visit of UK beef and lamb plants in early 2015 (to be confirmed). Defra said they are preparing with industry to ensure they have a successful inspection. For beef, the US has already released a rule change for BSE. Therefore, once the US Food Safety Inspection Service has granted equivalence status to the UK, producers will be able to export beef. However, we are still awaiting a rule change for TSE, which will enable exports of lamb. The earliest we can expect that is summer next year. On Canada, the UK already has an agreement to export lamb but beef is still restricted and unfortunately there is no timeline of when the situation might change.
87. Russian trade ban. On 7th August 2014, Russia announced a 12 month ban on the importation of certain meat, dairy, vegetable and processed foods from the EU, USA, Canada, Australia and Norway. Russia is the second biggest export market for EU agricultural products. In 2013, overall EU agricultural exports to Russia were worth €11.3 billion; however the Russian measures cover only exports worth €5.1bn, i.e. 43% of these exports. For example the ban does not include wine & spirits, cereals, pasta, olive oil, beverages, and a range of other products. EU exports 10% of its agri-food to Russia. 29% of its fruits and vegetables exports go to Russia, 33% of its cheese and 28% of its butter. The UK exports very little to Russia. In 2013, UK total food and drink exports, including alcohol, equated to just £115million including £17m of frozen fish, £5.7m of cheese and £5.3m of coffee. Unfortunately the ban has placed further pressure on what is an already weak European and global dairy market. The signs of that impact on the European market are now showing through as UK prices start to track EU prices.
Impact on UK market: The Russia import ban will overall have limited direct UK impact for most of the sectors; however this timing from President Putin is worrying as it comes when most farm prices in the UK have already seen significant falls over the past year and any further downward pressure can only exacerbate problems. For instance, with butter and cheese there will need to be a degree of market realignment required as Russia seeks alternative sources of supply and mainland EU seeks alternative export markets which is likely to add to the current downward price pressure in the short term. Fruit and vegetables: In the short term, the evidence is that UK prices have not been affected but as the ban continues it’s impossible to predict what effects we’ll see in the medium term, like the potential indirect impact resulting from other countries offloading its surplus products into the EU market, thereby putting downward pressure on prices or the result of Russia sourcing more from southern hemisphere countries, to substitute what it would have taken from the EU, thereby increasing competition on supplies. Pork: of the other countries involved, Canada is the only significant supplier (40% of Russian imports so far this year). This will increase supply on other global markets, which could in turn impact on EU exports (CETA TRQ for ractopamine-free pigmeat 80,550 t). EU Commission figures show an overall drop in the 5 months to May of 8.6% compared with last year at 1.13 mill tonnes, which is significant. In relation to the UK impact, there will be larger volumes of cheaper EU pork on the market and we will need to continue to put pressure on retailers to persuade them not to take advantage of this cheap supply to the detriment of UK contracts. Beef: Russia represents the largest single export market for EU beef but the volumes are extremely small in terms of overall EU production (26% of total exports but much less than 1% of production), therefore it is unlikely to have much impact on the EU market as a result. At most, could cause a delay to prices recovering from their recent falls.
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Poultry: UK has only been exporting poultry meat to Russia since 2013 and the main products exported are chicken cuts. European exports are worth £62million per year.
European Commission’s response: The Commission is coming under increasing pressure to table targeted measures aimed at the dairy sector in countries worst affected by the embargo. Ministers are expected to discuss draft plans - understood to focus on the Baltic States and Finland - at the Council meeting in Luxembourg on October 13-14. The package is likely to concentrate on dairy producers in the “clearly most affected” countries – which are big exporters to Russia - such as Latvia, Lithuania, Estonia and Finland. It would be difficult to agree on any new fund until the 2015 EU budget has been given the green light in December. The EU’s executive closed the system of Private Storage Aid for cheese on September 22 after only a few weeks following the “disproportionate volumes” taken up. Italy notified over 74 200 tonnes of high quality cheese in the first week alone, a figure 10 times greater than annual export volumes of certain protected cheeses to Russia in 2013.
If the Reserve is not used each year, farmers are reimbursed the following year, meaning many farm ministers are hoping the funds can come from elsewhere. The Reserve, worth €433 million in the 2015 budget, is generated via the CAP’s ‘financial discipline’ mechanism, whereby linear cuts are applied to all direct aid amounts over €2 000. Rather, unspent funds from the EU budget section housing the CAP (‘Heading 2’) will be looked at first.
A revised, more “targeted” support package for EU fruit and vegetable producers hit by Russia’s ban has now been finalised by the Commission – entering into force on September 30. The new package has a budget of €165m and is very similar to the first one which was suspended on Sept 10 after the number of aid claims – particularly from Poland - surpassed the budget allocation. Yet it is more targeted, with an annex setting eligible volumes for each individual member state. The specific figures per product group are based on export volumes to Russia in September- December in 2011-2013, with amounts deducted to take account of volumes already claimed via the initial €125m scheme.
88. NFU Economics has released the Key Labour Market Indicators for Q3 2014. The indicators are part of the AWB Information Pack and are used as guide for employers when conducting periodic pay reviews for workers. The latest figures indicated that the rate of inflation has fallen over the past year even as the economy has gathered momentum and house prices have surged. Both the UK CPI and RPI inflation rate fell in August according to the ONS. The CPI rate fell for the second consecutive month from 1.6% in July to 1.5% in August. Ongoing supermarket price wars and falling petrol prices have kept inflation below the Bank of England's 2% target for the past eight months, the longest run in a decade. The broader measure of RPI inflation which includes housing costs also fell, down 2.4% in August from 2.5% in July. However, inflation is still growing faster than average wages, which rose by just 0.7% in the three months to July from a year earlier. This represented the weakest growth since records began in 2001. A continued pattern of weak wage growth has led to the Bank of England to cut its wage forecasts for 2014 in half. The Bank now expects average earnings to grow by 1.25% this year. For more information, please see AWB pages on the Nfuonline.
89. The new National Minimum Wage rates (NMW) for 2014 were agreed earlier this year and came into effect from 1 October 2014. We have highlighted these changes by publishing articles in the B F & G, NFU Bulletin and Nfuonline. 2013 was the first year for the agricultural and horticultural sectors under the NMW framework, following last year's abolition of the AWB in England. This has been a significant period of change for the industry. The NFU has undertaken a considerable amount of work alerting farmers to the changes, and helping the industry to prepare for the new regime, including publishing Post-AWB Information Pack and a set of Key Labour Market Indicators (see above), to help employers determine the appropriate rates of pay for their workers. In addition to this the NFU held 33 large seminars with over 700 members collectively employing approximately 10,400 workers attending these. The NFU’s employment service continues to offer support and guidance to agricultural businesses. Page 16 Current situation in agriculture & horticulture: NFU Briefing
90. NFU Economics has responded to the Low Pay Commission’s (LPC) consultation on the NMW. We were invited to submit evidence and views on the levels of the different NMW rates and make recommendations on the levels from October 2015. In making our recommendations we have focused on the economy; employment and unemployment levels; and relevant policy changes as well the state of the agriculture sector. The NFU has called for a balanced approach when considering another rate rise at this point in the economic cycle. An increase of three per cent in the adult rate of NMW may limit the growth in the job market and may impact on job prospects of this group.
91. NFU Economics in partnership with AHDB has released the latest sector ‘Dashboards’. These were the outcome of Defra’s Farm Resilience Group meetings held in response to the adverse weather conditions in 2012/13. While more in-depth information is available by various levy boards, the new quarterly Dashboards summarise all the key pointers in once place and gives an at-a-glance, one-page ‘snapshot’ of the current state-of-play within Dairy, Pig & Poultry, Arable & Potatoes and Beef & Sheep sectors. The common theme in the latest versions is one of falling commodity prices and rising production across the sectors. A combination of global supply and demand factors and strengthening Pound has put a downward pressure on prices.
92. There has been a strengthening of the British Pound against both the Euro and the United States Dollar during the past year, a trend that could well continue. In light of these developments, NFU Economics has examined the impact of exchange rate movements for UK agriculture. The exchange rate fluctuations continue to prove to be crucial for British farmers; affecting not only their international competitiveness, but also their levels of agricultural support and profitability. We have already seen a drop of over seven per cent in the SPS rate this year. Clearly this less favourable rate for 2014 compared to 2013 will hit farming businesses hard, especially at a time when farm gate prices have been dropping significantly. More information can be found at NFU Briefing.
93. The FAO food price index (FFPI), which is a measure of the monthly change in international prices of a basket of food commodities (meat, cereals, oils and fats, dairy and sugar) averaged 196.6 points in August 2014, its lowest level since September 2010. In August, the index registered its fifth consecutive monthly decline, down 7.3 points (3.6 percent) from July and 7.9 points (3.9 percent) from August 2013. Except for meat, all the other food sub-indices dipped markedly in August, with dairy values falling most, followed by oils and sugar.
94. UK economic growth has been revised up to 0.9% for the second quarter of the year by the Office for National Statistics (ONS), compared with a previous estimate of 0.8%. UK GDP was 3.2% higher in the second quarter compared with a year earlier. Revised ONS figures also show the UK economy surpassed its pre-recession peak in the third quarter of 2013. Previously, this was thought to have been achieved in the second quarter of 2014.
95. 2000 NFU members attend Summer CAP Meetings – NFU Economics and Policy colleagues led over 30 CAP-focused meetings through June/July, with an estimated attendance of 2000. In addition, county advisers were equipped with presentation content to support further meetings at the local level. CAP Essentials fact sheets were distributed to all attendees at the meetings. A further round of meetings will take place in the autumn, focusing on the details of what members will have to do to access CAP programmes and delivered by the Land Management Services team.
96. Further policy decisions included in latest Defra CAP update – A further round of CAP decisions were released in Defra’s second CAP farmer fact sheet in August. Amongst the decisions clarified were: designation of spring/winter crops for crop diversification will be based on variety
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The period where 3 crops will be required for crop diversification will be 1st May – 30th June (although further flexibility is being explored) Definitions of when fallow must be available – for crop diversification the period is from 1st May to 30th June, and for EFA the period is from 1st January to 30th June
97. The latest publication also confirmed that pasture legumes will count as a nitrogen fixing crop under the EFA rules and is a point that NFU lobbied for. More information is also now available relating to implementation and agri-environment schemes (see sections from the Land Management Services and Environment teams for more information). Key areas that remain outstanding include the treatment of hedges bordering permanent grassland/non-agricultural land/neighbouring land, active farmer details, and a full list of catch crops.
98. The CAP Essentials fact sheets continue to be updated with the latest information and are available online here. They have been expanded throughout the summer, with additional content on Entitlements, NELMS and Permanent Grassland.
99. The introduction of the new CAP regime in 2015 will include a new Rural Development Programme. Although the broad themes/priorities were announced late last year, as well as headline budgets, work continues to evolve and finalise the details of various scheme elements ahead of their launch. Some 87% or £3.1bn of the budget will focus on the environment (NELMS), with other expenditure areas as follows: 5% or £177m on Growth Programme (supporting growth in the rural economy) 4% or £138m on LEADER 4% or £141m on Farming and Forestry Productivity Scheme (FFPS) to increase productivity and enhance the competitiveness of farming and forestry
100. The next RDP will use the same IT model as the wider CAP programme, so applications will be online. The new RDP is planned to open in January 2015 (note that new NELMS agreements won’t begin until January 2016). However, this timeline is subject to the approval of the RDP Programme Document by the European Commission. The document was submitted earlier this summer, with formal feedback given to Defra by the Commission on Sept 26th. NFU HQ staff regularly engages with Defra staff at a national level as Defra continues to develop the ‘blueprints’ for RDP delivery. More details on RDP schemes will be added to the website and featured in BF&G as scheme details are finalised.
101. NFU Economics worked with communications colleagues to highlight the complexity of issues around domestic food production and food security. Using the drop in the UK’s self-sufficiency ratio produced by Defra, August 7th was calculated as the day on which the UK “switches” from home grown production to a reliance on imports. The extensive media coverage generated by this statistical hook included The Guardian, the Daily Mail, BBC online and the Telegraph as well as a debate on Farming Today featuring the NFU’s Chief Economist.
Rural Affairs
102. Town planning: The NFU responded to a recent consultation seeking to update and reduce red tape nationally in the town planning system. In the future our members should be able to be clear about the conditions on their planning applications quicker and will see less involvement of statutory consultees such as English Heritage and Natural England. The process for changing the use of storage and distribution and light industrial uses to residential use and moving between shop, professional services and café/restaurant uses should also be easier. NFU asked for clearer national policy guidance for agriculture in the planning system and clearer procedural guidance for local planning authorities. NFU also cautioned against a two tier planning system, one that seeks to be more flexible, but then prevents development in National Parks and Areas of Outstanding Natural Beauty. NFU used the consultation to ask for more permitted development rights for agriculture and permitted development rights to be updated to reflect modern farming techniques (to take more farming development out of the planning application process). NFU also Page 18 Current situation in agriculture & horticulture: NFU Briefing
asked for the threshold for buildings for intensive livestock planning applications needing an Environmental Impact Assessment to be raised from 500 square metres to 1,000 square metres.
103. Broadband: The NFU highlighted the need for universal superfast broadband and reliable mobile phone coverage in a recent government consultation on the provision of digital infrastructure. The NFU asked for government departments to work together to accelerate rural provision and challenged current government targets for providing superfast broadband (measured at 24 Mbps) by 2017 for 95% of the population and 2Mbps for the rest (i.e. largely rural areas). NFU also raised concerns about mobile phone coverage, as although there should be 98% coverage by the end of 2015; this still leaves parts of the country not covered. Ofcom the regulatory authority recently acknowledged there are current issues in rural areas of ‘not spots’ and difficulties in keeping a signal, even for emergency calls even when network coverage should exist. The NFU also highlighted the value of the agricultural sector as a market for digital technology industry.
Science & Regulation
104. Members of the All Party Parliamentary Group on Science and Technology in Agriculture elected a new chairman at its meeting on 9 Sept. Mark Spencer, Conservative MP for Sherwood, previously a vice chairman of the group, will replace George Freeman MP. Mr Freeman was recently appointed as Minister for Life Sciences. Visit the group’s website for more information on past and future meetings.
105. Outline proposals for the new Agri-tech Centres for Innovation must be submitted by 15 October. Consortia will be bidding for £80m of public money to be matched with at least £80m from industry, to create a Centre that will be self-sustaining within 5 years. See Nfuonline for more information. The Technology Strategy Board, which is administering the process, has changed its name to Innovate UK. It can be thought of as the Government’s ‘innovation agency’, which funds, supports and connects innovative businesses and the research base to accelerate economic growth.
106. Concern is widespread that the President-elect of the European Commission Jean-Claude Juncker might abolish the position of the Commission Chief Scientific Adviser. The NFU, its staff and members were amongst 773 people and 40 organisations who signed a letter to Mr Juncker at the end of July saying how vital this role is to ensure scientific scrutiny in Europe. Read more on Nfuonline
107. The proposal to enable EU member states to legally restrict or prohibit GM crop cultivation has now entered its second reading. The Environment Committee will vote on the latest text 5/6 Nov, with a view to a final vote in January 2015. The NFU remains tentatively supportive of the current proposal as potentially the only way to break the long-lasting political deadlock on GMOs in the EU. However, we are concerned that amendments put forward by Parliament may make a new text unworkable and unsupportable.
108. The NFU is organising a ‘science conversation’ event for its members on the science behind bTB, on 17 November at Stoneleigh. NFU members will have the opportunity to hear directly from key scientists and leading vets working on diagnostics, herd controls, biosecurity and vaccination, as well as the Defra Chief Scientist and the Chief Veterinary Officer.
109. The Office of Rail Regulation consulted on proposals which would see legal requirements for line-side railway fencing watered down. The current legislation requires Network Rail (who are responsible for railway infrastructure) to prevent unauthorised access to the railway. Many NFU members find the current situation unacceptable and see no reason for a reduction in legal requirements. Read more on Nfuonline.
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110. The NFU spoke at a national safety conference in Ireland about the UK Farm Safety Partnership and the challenges around tackling farm safety in the UK. It was clear from the conference that the accident rate in both countries was unacceptably high. Although type and style of farm varies between the countries both the direct causes of accidents and underlying factors such as fatigue, stress and age are common to both. Read more on Nfuonline.
111. The NFU continues to push for the maximum permitted weights and speed limits for agricultural vehicles to increase. This is a policy issue on which the NFU has been lobbying for many years. While we are still awaiting an announcement following consultation, we continue to call for this issue to be resolved quickly.
112. Endocrine Disruptor Impact Assessment: A European Commission roadmap outlining options for the definition of Endocrine Disruption was launched in August and a consultation on the roadmap was launched on the 28th September. This will run until January 2015. The roadmap outlines a range of options from a very precautionary approach to a more risk based approach; it also proposes an option for including socio-economic criteria that could protect against loss of plant protection products. In preparation for the consultation the NFU has been working with AHDB and other levy boards to provide a UK impact assessment to feed into the European level impact assessment and consultation. The results of the study should be available in late October.
113. Loss of crop protection products: The NFU has organised an event on 21st October in London to launch a report produced for NFU by Andersons on the impact of overarching pesticide legislation on farmers, growers and the wider economy. The report will also have a Brussels launch and will be accompanied by NFU policy asks on pesticide legislation for UK and EU regulators. This is a continuation of the Healthy Harvest campaign; the Healthy Harvest document is available here.
114. Flea beetle: The NFU has been heavily involved in seeking emergency approvals for insecticides that could help control flea beetle and aphids in OSR in the wake of the neonicotinoid restriction. The NFU supported an application by Syngenta to register Cruiser as a seed treatment for emergency authorisation which was later withdrawn by Syngenta. The NFU then lobbied for the authorisation of InSyst and Biscaya for use in the autumn as control options to complement the use of pyrethroid sprays. The applications were finally granted on 26th September 2014.
115. Use of gloves in risk assessment process: The NFU has been working with HDC and Chemical Regulation Directorate (CRD) to arrange for the consideration of use of gloves by farm workers to reduce calculation of re-entry periods. CRD have confirmed that ACP have accepted these proposals and will consider relevant applications in the future. In practice this will mean that growers will have the option to shorten re-entry periods on certain products if workers are wearing gloves. It will also mean that certain currently unavailable products can be registered in the UK.
116. Rodenticides: The NFU continues to work with manufacturers and professional users to develop the development of the agricultural sector’s contribution to an industry-wide SGAR (Second Generation Anticoagulant Rodenticide) industry stewardship initiative. Regretfully, the NFU has taken the decision to halt discussions due to significant concerns about the proportionality of the approach that is being proposed by other industry partners to the regulator, HSE. The NFU has written to the Minister requesting an urgent meeting to discuss the issues. More information is available here.
117. BCPC congress: The NFU presented its concerns about the current pesticide legislation and the need to review the regulation governing pesticides. The congress was attended by around 200 delegates and included a range of national pesticide regulators from the UK and other member states.
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118. In July the NFU launched a review of livestock inspections, after it was selected by the Department for Business Innovation and Skills to lead a review of enforcement red-tape under the Business Focus on Enforcement initiative. The aim of the NFU review will be to gather evidence from an industry perspective on livestock visits and inspections, examining the potential for duplication and overlap between national regulators and local authorities. As part of the review the NFU will present its findings and evidence to Ministers. More information can be found on NFU Online
119. The NFU attended a consultation at St Georges House Windsor in July for a debate and discussion on ‘Attracting and supporting New Entrants in Agriculture’. The subject of the discussion followed on from the ‘Future of Farming report’ in July 2013 and presented an opportunity to discuss the recommendations from the review and the priority that should be given to them. Topic areas discussed included apprenticeships, skills and training, and the image and perception of the industry.
120. During September the NFU once again participated in the Feeding Britain’s Future initiative. The campaign is driven by IGD and supported by Job Centre Plus in a bid to tackle the country’s youth unemployment. The initiative sees businesses across the food and grocery industry supply chain open their doors to provide employability skills training to local unemployed young people. The NFU event gave 16-24 year olds the opportunity to meet with staff to discuss potential career opportunities within agriculture. We also provided an interactive CV session providing advice on how to tailor CVs and information employers would be looking for.
121. Work on the details of the Official Feed and Food Controls, otherwise known as the ‘5 part package’, continues. The European Parliament reached first-reading positions during its April plenary session. The individual packages (the Animal Health Law, the Plant Health Law, Plant Reproductive Materials and the Official Controls) are now going through the process of being confirmed by the new Parliament. The Council’s discussions are not yet complete. Defra expect that the trilogue negotiations will begin in late 2014 / early 2015 with political agreement reached around March to April 2015. NFU staff continue to influence UK Government negotiating positions through Core Group membership, whilst supporting BAB colleagues in developing MEP briefings and UK positions for various European stakeholder discussions.
122. The annual EU Antibiotics Awareness Day on 18th November, is galvanising action amongst the UK and EU stakeholder groups concerned with promoting the responsible use of medicines in agriculture. RUMA, of which NFU is an active and founding member, will be launching its new website with updated cattle guidelines on responsible use of antibiotics to coincide with the date. At the same time the Veterinary Medicines Directorate is asking everyone in the UK, the public and the medical community to become Antibiotic Guardians by signing a pledge about how we can make better use of antibiotics and help save these vital medicines from becoming obsolete through development of resistance. There is a specific farmer pledge which can be ‘signed’ on the Pledge website at http://antibioticguardian.com/.
123. The NFU was heavily involved in media activity over the summer months surrounding the use of veterinary medicines in food producing animals. Tom Feilden, the Science & Environment correspondent on the Today Programme on BBC Radio 4, visited Richard Longthorpe’s pig farm in July to record a programme on responsible antibiotic use in the pig sector whilst various NFU members and RUMA’s Secretary General, John Fitzgerald, contributed to a very balanced piece on antibiotics in the food chain for BBC’s Countryfile. This was paralleled by a written article in BBC’s Countryfile magazine which featured a John Craven interview with the NFU’s animal health and welfare adviser, Cat McLaughlin.
124. The long-anticipated review of the EU’s Veterinary Medicines Regulations and Medicated Feeds and Feedingstuffs Regulations has finally got underway. The European Commission published both draft proposals in late September. The NFU, working with RUMA partner organisations, is currently analysing the draft proposals which appear to resonate strongly with Page 21 Current situation in agriculture & horticulture: NFU Briefing
UK principles of responsible use. Following co-decision procedures, we expect the new provisions could come into force in 2015, with a possible implementation period of 24 months.
Land Management Services
125. The June, July, August and September issues of “Down on the Ground”, the e-newsletter from the NFU Land Management Services Team, have gone out to all staff and members. The newsletter aims to provide a regular and timely round-up of relevant and practical information including key dates and events. Each issue focuses on just three key areas for farm businesses; the Single Payment Scheme (SPS), Rural Surveyor issues such as tenancy and HS2 and the very latest updates from the Industry led initiatives like the Campaign for the Farmed Environment, Tried & Tested and the Voluntary Initiative. You’ll be able to find these latest editions of Down on the Ground on Nfuonline under the Newsletters tab.
126. On 3rd July, the NFU attended the Westminster Briefing, ‘Tackling Fly Grazing in England and Wales’ in London. Discussions included a review of the Welsh legislation and how England can follow to provide solutions for landowners, local authorities and animal welfare. An NFU Briefing for staff was released on 29th July, looking at the NFU’s recent work on tackling this issue. On 30th July, the NFU met with GRC Bailiffs, exploring the possibility of identifying a third party reputable Bailiff company that can provide a good quality service to our members. A draft Memorandum of Understanding (MOU) has been sent to GRC Bailiffs, with regard to supplying services to NFU Farmer and Grower members at a discounted rate.
127. The NFU attended a meeting arranged by World Horse Welfare at the CLA offices in London on 7th August. This led to six major charities and the country’s largest rural organisations, including the NFU, releasing a report on fly grazing, 'Stop the Scourge - Time to address unlawful fly- grazing in England' on 1st September. Prior to this, on 19th August, NFU HQ, North East Regional, London and Cymru colleagues met together at Stoneleigh to discuss the issue. On 15th September, NFU colleagues at HQ met to discuss the opportunity of producing a defined pack which can be sent to members who are experiencing problems with fly grazing on their farm and/or in the region. Related to this, we are also exploring the idea of providing a fly grazing email/text alert service to members, for when an incident is reported in their area. September’s edition of the British Farmer & Grower magazine included an article on fly grazing. The NFU launched its 2015 Election Manifesto on 17th September. This calls for specific legislation that enables local authorities and private landowners to control illegal grazing of horses (fly-grazing) in England.
128. Julian Sturdy’s (MP for York Outer) Private Members Bill, to bring forward legislation matching the Welsh on fly grazing, was launched in the House of Commons on 15th July. The NFU are supporting Julian Sturdy, providing information and findings on the scale of fly grazing across the country. Julian Sturdy’s Control of Horses Bill is scheduled for a second reading on Friday 24th October. However, Defra are now considering the following amendments to the Animals Act 1971: Reduce the detaining period from 14 days to 3 ‘clear’ days (please note this would only apply to equine). Clarify the definition of stray animals – to include horses which are deliberately placed on land (without permission). Other methods of disposal (other than selling through open market) to include humanely destroy and gift to sanctuaries. The above powers would apply to both local authorities and private landowners.
129. On 3rd September, the Efra Select Committee listened to evidence on horse welfare, with a particular focus on fly grazing. NFU Deputy President, Minette Batters represented the NFU’s concerns at the meeting. Lord de Mauley made the following points:
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Government would pick up costs of the central equine database itself / individual horse owners pay for passports etc. The Anti-social Behaviour, Crime and Policing Act 2014 set to come into force on 20th October 2014. Community Protection Notice (CPN), to speed up procedure; if breached it is a criminal offence (with the appropriate penalties attached). Can take a very long time to use an ASBO and a lot of effort, this is where the CPN, the new tool, comes in, which is a much more flexible and easy-to-use tool. You issue a CPN first and if there is no action you can quickly move to take that person to court.
130. Following the Efra Select Committee meeting, the NFU was asked to provide further information with regard to fly grazing on common land. A Commission proposal to revise the rules for the identification of horses was endorsed on 11th September by EU Member States’ experts (the Standing Committee on the Food Chain and Animal Health), and will apply from 1st January 2016. This will require all Member States to have a centralised database. However, EU countries not already having a centralised database will have until 1st July 2016 to put one in place. Commission Regulation (EC) No 504/2008 requires foals to be issued with a single passport having a unique identification number, before their first birthday. The passport also serves as a medical record and will serve the horse over its lifetime. All horses born after 1st July 2009 need to be micro-chipped. Technical security features aimed at reducing the risk of falsified passports have also been put in place.
131. On 4th September, the NFU attended the Poaching Priority Delivery Group (England & Wales) meeting. The group comprises of police representatives, the National Wildlife Crime Unit (NWCU), the British Association for Shooting and Conservation (BASC), the National Gamekeepers Organisation (NGO), the Food Standards Agency, the Deer Initiative, the Angling Trust, the Environment Agency (EA), the National Farmers Union (NFU), Country Land and Business Association (CLA) and the Countryside Alliance (CA). Launched on 1st October 2013, Project Trespass is an initiative of the E&W Poaching Priority Delivery Group (PPDG). The NWCU has undertaken a review of intelligence, numbers and types of convictions and other information received following the first six months of the project. Results show that intelligence collated from across England and Wales by the NWCU increased from 44% to 55% for the total amount for wildlife crime received. Moving forward with Project Trespass, the PPDG are planning to produce a bulletin twice a year to highlight the issues of poaching and the success stories. Press releases could also be used in conjunction with the bulletin to highlight instant topical events. On 11th September, the NFU attended the first ever National Anti-Poaching Conference, held at JCB World Headquarters. The event, organised by The National Gamekeepers’ Organisation (NGO), saw a broad range of topics aired during the daylong conference including: raising public awareness; getting convictions; connections to organised crime; problems for the rural economy; information sharing; use of forensics; concerns of the meat trade and possible future legal changes. Delegates heard several case studies where operations to crack down on poaching had been successful. Further to this, discussions have taken place between NFU colleagues with regard to including a poaching article in the British Farmer & Grower magazine.
132. The NFU have been working on the new Defra draft Code of Practice, ‘The Use of Snares in Fox Control’. The Independent Working Group on Snares (IWGS) includes BASC, Countryside Alliance, Game and Wildlife Conservation Trust, NFU, National Gamekeepers Organisation and Moorland Association. In July, the IWGS sent their final comments in response to the latest draft Code, to Ashley Matthews of Defra. These comments are important to the group if we are to endorse the new Code. We are awaiting Defra’s response. Defra has informed the group that the use of snares in rabbit control will be addressed at a later stage.
133. In August the NFU welcomed a new code of practice for sky lanterns, published by The Trading Standards Institute. The code offers guidance for those designing, manufacturing, distributing,
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retailing or using Chinese lanterns (sky lanterns). However, the NFU are still lobbying for a ban on the sale of Chinese lanterns due to the dangers to farm livestock, wildlife and the risk of fire to crops, buildings and waste sites. This has been included in the 2015 Election Manifesto. Colleagues at NFU HQ are meeting at the end of September to discuss the Love Your Countryside campaign and Chinese lanterns.
Knowledge exchange and sustainable intensification
134. The Food Economy Task Force, which is coordinated by the National Centre for Universities and Business (NCUB) has continued to meet during the summer months. The aim is to help boost the UK’s food economy through world-class collaboration between businesses, universities and government. This current Task Force on Food Economy is co-chaired by Justin King, Chief Executive of Sainsbury’s and Professor Quintin McKellar, Vice-Chancellor, University of Hertfordshire. Its ambition is to develop a number of key recommendations to determine how universities, business and government can work together more effectively to benefit the UK’s agri-food sector and build on the UK Agri-tech Strategy. Three workstreams have begun work looking at 1) developing the right graduate and research talent - now and for the future, 2) science and translation and the race to the top in global innovation and 3) how to optimise the use of land, resources, and pull through into innovation. The NFU is participating in workstreams 1 and 3. The NCUB intends to publish their findings and recommendations October 2014.
Industry-led Environmental Initiatives
135. The Campaign for the Farmed Environment (CFE) produced its 2013-14 Annual Report www.cfeonline.org.uk/cfe-annual-report-2013-14 highlighting a successful year for the Campaign.
136. CFE governance groups have moved quickly to agree CFE’s position on greening in the light of Defra CAP announcements. This has ensured partners and local coordinators can communicate clear messages on how CFE can encourage environmental enhancements to Ecological Focus Areas. This has involved regular consultation and agreement with partners and working with key external stakeholders, including RPA and FAS. CFE had a high profile at a series of national events for advisers on CAP reform run by FAS & RPA, and local CFE coordinators are also heavily involved in communicating CFE’s role within greening. The profile of CFE has also been raised through direct contact with Defra ministers at national shows. Visiting the CFE stand at the Livestock Event, George Eustice said: “It’s important to farmers to employ voluntary environmental measures as part of a viable business plan. The truth is, regulations and cross-compliance can only go so far – by definition they are prescriptive. What we really want farmers to do is embrace the concept of protecting and enhancing the environment and taking advice from initiatives like the Campaigned for the Farmed Environment.” During three days at the CLA Game Fair, CFE also welcomed the new Secretary of State, Elizabeth Truss, as well as Lord de Mauley and shadow minsters Huw Irranca-Davies and Angela Smith.
137. CFE continues to facilitate the industry’s support to the UK Government National Pollinator Strategy. This now involves: Promoting relevant CFE Voluntary Measures: a number of the CFE Voluntary Measures include options that provide floristic value or habitat for pollinators. These have been promoted by CFE coordinators since the campaign’s launch in 2009, and in 2013 over 7,000 hectares were managed voluntarily with floristic measures. Promoting the CFE Pollinator management guide: In February 2014, CFE launched the ‘Pollinator management for your farm business’ guide. The guide has been very well received by pollinator experts, CFE partners, CFE coordinators and NFU members. Pollinator experts join the CFE partnership: Following the agreement for CFE’s focus on pollinators, the PO approached Bumblebee Conservation Trust (BBCT) and British Beekeepers Association (BBKA) and partners agreed that those organisations could join
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the Delivery & Communications Group (DCG) to ensure their expertise can be utilised by the campaign. CFE Pollinator Events: During the summer of 2014, CFE local coordinators ran 37 pollinator-focussed events through summer 2014; with an average attendance of 25 farmers and advisers per event (total numbers were 729 farmers and 191 advisers attending). During the spring of 2015, local coordinators will run a further series of events focussing on pollinator management on farm. These will focus on the ‘hungry gap’ for pollinators, the April-June period where flower resources are low and queens are developing nests. In this period, well managed hedgerow habitats and early flowering trees and plants are vital to healthy pollinator populations. Running a successful pilot of a Pollen & Nectar Seed Bank. The pilot successfully distributed the equivalent of 400 hectares of pollen and nectar mix via CFE events and stands at national shows. Plans are ongoing to monitor and promote this project, as well as develop a wider scheme involving AIC and CPA members, as well as other seed houses. Developing a Pollinator target: a set of delivery and land management targets to assess CFE activity to promote pollinator management has been proposed, and the aim is for this to be adopted by CFE in time for a series of pollinator-focussed events in spring 2015. Adviser Training: CFE partners have identified another important focus as training agronomists and other farm advisers on best practice in pollinator management and establishing pollinator habitat. A pollinator section of the CFE Online Training Module will be developed during autumn 2014, to provide training to advisers. CFE will also meet with BASIS to ensure this training is given appropriate accreditation. Some CFE events will also be targeted at advisers to provide practical guidance.
138. CFE continues to promote voluntary measures on farm that aid resource protection, and particularly water quality. This involves: Hosting the Agriculture and Forestry Working Group of Catchment Based Approach. The first meeting of this Group was in September, and CFE partners agreed to provide information on how Catchment Partnerships and CFE local groups are linking up. Hosting a meeting on the Agriculture & Water Quality - industry offer. This meeting will take place on 7th October and will identify how industry approaches can help address diffuse pollution and suggests a new approach for partnership working on water quality challenges through CFE and its partner-led activity (subject to agreement from all CFE partners). Production of the next set of CFE guides that focus on resource protection. The CFE Nutrient management for your farm business was produced in August, and the Soil management for your farm business will follow in October. Directing CFE coordinators to focus local activity during autumn 2014 on water quality issues.
139. CFE set up a meeting between NFU and RSPB at Richard Bramley’s farm in Yorkshire. Richard is an NFU member and chair of the local CFE group, and was keen for a more positive approach to the annual Farmland Bird Index. A new approach has been proposed that recognises the changes in the way farms are managed for the benefit of the countryside. CFE have invited RSPB to sit on the campaign’s Core Group in order to facilitate this process and discussions are in progress.
140. Due to an error at Defra Stats the results of the Defra annual survey of land managed under CFE were delayed. The survey results were finally released on the 25th September and can be found here: www.gov.uk/government/statistics/campaign-for-the-farmed-environment-survey-of- land-managed-voluntarily-in-201314-england There are a number of successes within the results and for the majority of CFE measures land is being retained at the same area as last year. This is a very positive
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sign that farmers are addressing environmental challenges in difficult circumstances. Figures show an increase in some farmland bird measures with 9,760 sky lark plots and 2,140 lapwing plots managed voluntarily by English farmers. Farmers have also voluntarily fenced 7,387km of watercourses and created 8,000ha of floristic habitat for pollinators. CFE partners had already recognised that the results of the 2013 survey were artificially high and the overall area of land managed voluntarily fell from 2013 to 2014 (from 670,00ha to 452,000ha). This decline can be attributed to just 2 of the 22 CFE Voluntary Measures (over wintered stubbles & fertiliser-free permanent pasture). 2012-13 was an unusual cropping year, with weather conditions making it difficult to get into field or to apply inputs. During the life of CFE, the area of over wintered stubbles has always been around 105,000ha, in 2013 it was double that. The 2014 figure (108,000ha) is a return to expected levels. The fertiliser-free permanent pasture measure records the amount of permanent pasture managed in a certain way (without inputs). A decline in this measure does not necessarily mean that permanent pasture is being lost (it is likely that fertiliser couldn’t be applied to fields in 2013 due to weather conditions). Also, this measure has only been measured for two years (2013 & 2014) so a trend cannot be inferred.
141. The November Tried & Tested (T&T) Wider Industry Meeting will recognise the 5th Anniversary of the formation of the Professional Nutrient Management Group (PNMG) and ask its supporters how T&T can improve its offering to the agricultural industry and continue to advocate the support of wider environmental concerns over the next 5 years. Whilst distribution of materials continues to achieve record rolling annual figures (14,387 booklets and USB’s, the highest distribution figure since the October 2011 to September 2012), we are beginning to question how the tools are being used and their main benefits as considered by industry advisers and farmers alike. It is encouraging Defra Farm Surveys continue to reflect the increase in farmer adoption of Tried & Tested materials. It is also encouraging news that T&T has been asked to contribute to the future development of the Fertiliser Manual (RB209).
Single Payment Scheme (SPS)
142. SPS 2013 Payment Progress - The RPA has continued to pay the remaining 2013 SPS claims. By mid-September, there were less than 150 claims to pay. The RPA have paid over 102,750 farmers a total of c£1.66 billion for SPS 2013. Those that cannot be paid are tied up in the main with potential overpayments or are in probate. The RPA have continued to be in contact with those not paid. The NFU continues to chase members SPS payments with the RPA.
143. SPS 2013 Financial Discipline Refund – The NFU has raised with RPA the position of farmers receiving a refund on financial discipline reductions taken from the 2013 SPS payments (information on this was set out in the 2014 SPS Update Guidance). RPA states that if a refund is due then this would be issued with the SPS 2014 payments, which are made from December 2014 onwards. However, the NFU is concerned that crisis funding may be absorbed when meeting costs of the EU Private Storage Aid schemes introduced following the closure of Russian markets to EU produce.
144. SPS 2014 Applications – The NFU keeps a close eye on the progress on the 2014 SPS claims. The RPA report good progress in validating these claims. They also report no new issues or delays in inspection work need to validate claims. The RPA, as reported in the last Current Situation, have to increase cross compliance inspections for SMR4 – NVZ (checking records), SMR7 (Cattle ID) and GAEC1 (Soil Protection Review). As with SPS 2013 inspections, these extra checks will be incorporated into the existing inspection regime, where possible.
145. SPS 2014 Online Uptake - The RPA have reported another increase in electronic submissions in 2014. Out of the c103,000 claims received for SPS 2014, 70,249 were submitted online and 32,652 posted (NB there were no drop in centres this year). This is an increase of c14,000 online Page 26 Current situation in agriculture & horticulture: NFU Briefing
claimants compared to SPS 2013. With regards to changes in application approach for 2014 more farmers switched from paper to online when they had used a drop in centre in 2013. Also more farmers submitted their claims earlier this year due to not being able to hand deliver their forms, but there was still a significant number of forms submitted in the 7 days to 15th May. The RPA’s efforts to get more farmers online by targeting those who are on CTS Online, large claims, have an email address or used a drop in centre in 2013 saw a higher conversion rate than other groups not targeted. The RPA analysis carried out on 2014 SPS claims will help them in supporting those yet to go online in the run up to submitting the 2015 BPS claim online.
146. SPS 2014 Payment Rates – SPS 2014 Payment Rates – The Euro Exchange Rate for SPS 2014 has been confirmed by the RPA as 0.77730 £:€, this does not compare favourably to the rate for SPS 2013 which was 0.83605 £:€, a decrease on the 2013 rate by 7.03% (rounded). The last time the exchange rate was this low was 7 years ago. The NFU has made members aware of this position as well as the other factors that will impact adversely on the 2014 SPS payments. As a reminder the other key factors that will impact on the value of entitlements for SPS2014 will be: Financial Discipline; new SPS Budget; and impact of the Inter-Pillar Transfers of CAP Funds. Given that 2014 is essentially old scheme (SPS) with new CAP budget, we are urging RPA to explain ahead of making 2014 SPS payments that modulation has been replaced under SPS in 2014 with the one off inter pillar transfer agreed last year. We want RPA to head off farmers getting concerned over the change of approach to funding and reductions made to their payments. The RPA following NFU lobbying will warn farmers at the first point of contact about these changes.
147. 2014 SPS Payment Targets – Disappointingly the RPA targets for SPS 2014 are the same as for SPS 2013. The targets for SPS 2014 are therefore to pay 93% of claimants and 86% of the SPS fund by 31st December and 97% of claimants and 97% of the SPS fund by 31st March. The NFU is keen that RPA clear SPS 2014 work and payments as soon as possible to help with the rollout of the Basic payment Scheme (BPS) and help the industry during a challenging time.
148. New RPA Website and Phone Numbers - The RPA in July transferred its web presence from DEFRA hosted RPA website to Gov.uk. The NFU had highlighted to the RPA initial problems with the new website – for example no obvious link to cross compliance information and poor link to BCMS. These and other issues have now been resolved. The challenge going ahead is that the website appearance and content is dictated by Government Digital Service, even down to the font used. The RPA have also changed their 0845 phone numbers to 0345 ones, which should be less expensive for users (especially those calling from mobiles).
149. Remember SPS 2014 lasts until 31st December 2014 – We continue to remind members of their ongoing commitments under SPS, there are still cross compliance and eligibility checks ongoing. We have recently updated a number of member briefings. These include taking on new land and things to consider; reminder about cross compliance failures on the back of recently released 2013 cross compliance inspection data and a briefing / article covering the record keeping requirements for cross compliance under SPS. This information has been popular with members, given that poor record keeping is usually the main reason for cross compliance breaches. More member information can be found here.
150. SPS Entitlements – Revised 2014 Transfer Deadline and Reminders – Both the NFU and RPA have been raising with members the different arrangements for entitlement transfers that exist until the end of the year. In short, members who need or want to transfer entitlements before the end of the year must ensure the RPA receive the RLE1 form by midnight on 21st October 2014 and the ‘effective date of transfer’ stated on the RLE1 form must be on or before 3rd December 2014. These transfers will be based on the current SPS rules and therefore avoid the Active Farmer requirement under BPS which kicks in from 1st January 2015. The NFU has urged the RPA to accept hand delivered RLE1 forms up to this deadline. The NFU is also seeking clarity from RPA on the use of the RLE1 form for land change notification (which is the other main use of the RLE1 form). Page 27 Current situation in agriculture & horticulture: NFU Briefing
151. Ongoing Appeal Process and Panel Members – DEFRA are planning to continue with the current appeals process that covers SPS for BPS. Following a recent recruitment process organised by the RPA, Ministers have recently appointed 37 new industry people including farmers to sit on the Independent Agricultural Appeals Panel. The panel considers appeals against decisions of the RPA and makes recommendations to the Minister. At these hearings appellants make their case and are questioned by panel members in order to clarify points before the panel reaches a decision on what to recommend. The majority of appeals in recent years have been in relation to SPS, however, over the next few years we expect these to be replaced by Basic Payment Scheme challenges. The NFU has lobbied for sufficient resource in terms of panel members during this transitional period. Ministers as a result have taken a decision to retain 14 existing panel members until November 2015 to ensure there is a handover of knowledge to new panel members.
CAP Reform 2015 Implementation
152. NFU Activity on CAP Reform Implementation - The months of June, July, August and September have been very busy for those involved with the new CAP schemes at the NFU. There have been many meetings with DEFRA, CAP Delivery team and RPA, covering the new CAP rules / IT software design / review of information and guidance. This work will continue into the autumn and winter. The purpose of the engagement is to ensure the new scheme rules and IT is fit for purpose by working through the key element of policy implementation.
153. We have Paper Guidance for 2015 – During a House of Commons debate on 7th July the Minister of State announced there would be paper CAP guidance for all farmers in 2015. This is an NFU lobbying success; we had worked hard over a long period to secure this for farmers. Since the announcement DEFRA has issued the August CAP leaflet as set out below to all farmers. This will be followed by paper versions of the next CAP leaflets due at the end of October, early December and the 2015 cross compliance guidance also expected in December.
154. Decision on Dual Use arrangements for all existing Environmental Stewardship agreements – DEFRA have informed us that Ministers have decided to maintain the current policy of allowing Dual Use arrangements for all existing Environmental Stewardship agreements. This will mean that two different farmer beneficiaries may continue to receive support under two separate CAP schemes for the same piece of land at the same time. The most common of these situations is where a tenant claims SPS and the landlord claims ELS. This decision is welcomed by the NFU who have been lobbying for a number of years now for the situation of dual use to continue both under SPS and also under the forthcoming Basic Payment Scheme. We submitted our reasoned arguments last year on the period beyond SPS where existing Environmental Stewardship agreements would run alongside BPS/Greening. The NFU submission has been appreciated and recognised by DEFRA as helping in the decision making process. With the introduction of Greening in 2015, this will present some additional control challenges for DEFRA / RPA and the NFU continues to work through these issues to ensure that member’s interests are taken into account.
155. Common Land Mapping - The RPA over the last year has mapped accurately for the first time common land for CAP purposes. We have been pushing the RPA to roll out the revised maps so the industry can review and react to them, so that the final positions can be in place in good time for 2015 BPS applications. The RPA are only looking at commons where SPS has been claimed on. All permanent ineligible features (PIFs) have been mapped out. We are seeking confirmation whether the new mapped areas will be backdated to 2014, and earlier SPS years. The RPA will write to the farmers involved, notifying them of their revised notional area for 2015. For the larger more sensitive commons, where there is large areas and numbers of commoners involved - Cumbria, Dartmoor, New Forest etc., the RPA plan is to deposit at a geographically accessible location the large RLR maps to allow commoners to view and comment on them. The aim is to give opportunity for face to face engagement. The NFU is keen that those commoners impacted Page 28 Current situation in agriculture & horticulture: NFU Briefing
by the changes to the mapping are informed as soon as possible – for example minimum claim size, usage of entitlements and greening issues etc could all be impacted by the outcome of this exercise. The RPA admitted that time was tight to rollout the work needed to engage with commoners. The NFU will raise this activity with members when more details are released.
156. Latest CAP Guidance - On 14th August the RPA published the second CAP Reform leaflet for farmers entitled “CAP Reform: The new Common Agricultural Policy schemes in England - August 2014 update including ‘greening: how it works in practice”. It was essentially an update and confirmation of information known to some extent by the industry, with fuller guidance on CAP greening. Since this document was published it has generated a large number of questions which the NFU continues to process and feed into DEFRA / RPA. Some of the key principles and outstanding information from the questions raised will appear in the next CAP leaflet due at the end of October.
157. Key issues raised by members and not so far addressed by DEFRA (and which we hope are covered in the October CAP leaflet or a separate Q&A document (which we have lobbied for)) are listed below: Catch crop / cover crop detailed rules Existing margins that do not count as an EFA buffer strip, can they count as EFA fallow Can EFA Buffer Strips & adjacent EFA Fallow Areas coexist? EFA Fallow management Definition of a hedges and when can they be used for EFA Clear messages around interaction between Greening and agri-environmental schemes and the distinction between double funding and requirement to green Crop diversification – crops not in the ground for the full 2 month cropping period Crop diversification - Spring/winter brassicas Crop diversification - Varieties not on the National List / PGRO list – Greening & Organic / Non Organic Holdings Active Farmer Cross compliance Rules Further rules for cross border holdings BPS Land Eligibility National Reserve Approach to Common land under greening / BPS Young Farmer Scheme
158. Mapping of EFA Features - The NFU continues to lobby on this important element of administration to ensure that farmers can use features that are present on their farms going forward under greening. This includes hedges and avoiding delayed BPS/Greening payments in 2015 and later years.
159. Active Farmer Update – The NFU continue to challenge DEFRA on their approach to this new requirement. DEFRA have confirmed that they are only using the negative list element of the regulation to test if a farmer is an active farmer or not. Active Farmer applies to farmers receiving sums over €5,000. Guidance on Active farmer will come out in the October CAP Leaflet. The NFU has warned DEFRA that there needs to be full and helpful guidance issued to avoid the problems seen with the release of information on greening.
160. Update on Cross Compliance Issues – The NFU has continued to lobby DEFRA to mitigate Ministers’ decision to restrict hedge and tree cutting between 1st March and 31st August, especially in respect to crops sown in August. The NFU is also lobbying to retain current exemptions & derogations that exist within the current 2014 cross compliance rules next year, for example hedge cutting exemptions for road safety. We are also challenging the approach to penalties – ensuring the point raised in the Secretary of State announcement on cross compliance (10th June) was being actively followed up. With regards to the 2015 cross Page 29 Current situation in agriculture & horticulture: NFU Briefing
compliance guidance, it has to be fit for purpose. That it explains the rules as the current guidance does. DEFRA appear to be working on following a similar style to the 2014 guidance. The guidance is expected to be mailed out in December. The underlying principles for the NFU are that the cross compliance guidance can be 1) easily understood and 2) that members have the best chance of compliance. Finally we are working up with DEFRA the new soils cross compliance standards to replace the Soil Protection Review. There will be no paper aspect to the new soil GAECs and they will now be assessed in-field by the RPA.
161. BPS Eligibility – Trees – The NFU is currently heavily involved in trying to shape what is eligible under BPS going forward. Of major concern at this time is the new restriction that means land containing more than 100 tree/ hectare would be deemed ineligible under BPS. This could have significant repercussions for those grazing and using such land, especially areas of common. The NFU wants clarity on the point that the regulations do not cover orchards where there is a repeated harvest. The key will be a pragmatic way to deal with the implementation of the 100 tree per hectare rule.
162. BPS Eligibility –Solar Panels - currently, land on which there are solar arrays can be eligible for SPS only if the land is predominantly used for agricultural activity. Under BPS, DEFRA want to make sure CAP monies is going to those people who primarily use the land for agriculture. The NFU believes that where the farmer has not rented out the solar panel site, we do not see the presence of solar panels as being an out and out reason for land to be ineligible under BPS – there is a wide range of installations both via type and scale that exist. It has been shown that agricultural activity (livestock grazing) can and does coexist with solar panel installations with little disruption; even arable strip cropping could take place. There are a number of ways that are currently used by DEFRA / RPA to allow areas adjacent to solar panels to remain eligible and these should continue under BPS.
163. BPS Eligibility – Permitted non-agricultural activities for BPS purposes - DEFRA are currently reviewing the non-agricultural use activity provisions under SPS for use under BPS. DEFRA are not looking at wholescale changes to the current SPS rules. The NFU has stated that the principles laid down in 2005 have largely worked well, farmers understood them and we would not want to see any changes for 2015 that could be seen as being more restrictive on our members.
164. Transition to Online Application Process / Assisted Digital - The new CAP IT and CAP Information Service (CAPIS) which is the new online application service has started to be rolled out. Initially via direct invite only, but gradually to more farmers over the coming months. Contact will gradually rollout out via letter or e-mail with a registration pack containing information on when and how to register for the new scheme. Contact with the majority of farmers will be from late October onwards. Members will be able to do the following (during this first part of a two part preparation process): Register to use the new service (via the new Identity Assurance process (IDA)) Check their existing personal and business details Assign third parties to act on their behalf Check land parcels associated with their business (there is a greening calculator included) Update land cover and add new land features for 2015 onwards Receive email alerts from the new service Contact the new CAP information service
165. From early 2015, the new CAPIS will allow farmers to apply for BPS/Greening. There will be new telephone, online and face-to-face support available for those invited to use the service who need help to get online and use it. This will be via a number of Digital Assistance Centres. RPA expect c25,000 of these not online to claim for BPS (taking out small claimants) in 2015. In order to help this group, RPA are starting to issue letters explaining what the future holds and offering
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them support by asking them to respond to a reply card. This is for the c13,000 claimants RPA cannot see any “digital footprint” for, so no online interaction with the RPA/BCMS, no email address. In October, RPA will undertake outbound calling to offer help / follow up support offer to this group. Digital Service Centres (DSC) will open to help with face to face registration for the new system; this will run from November through to January. The aim is to have these DSCs no more than 30 miles from claimants. Further plans are being finalised for the remaining 12,000 claimants not online, but RPA can see a digital footprint and the c70,000 claimants already online.
166. NFU has lobbied for assistance for those who will be challenged by the changeover of IT and the online only process. We continue to remind RPA that they need to assist those farmers who were already online, they may only want a few phone calls to help them on the way to register online. Of particular concern are the challenges faced with needing to register via the new Identity Assurance process (that will be used instead of Government Gateway to access CAPIS). The NFU has also raised concerns as to how long the actual application process will take to complete, even for someone who knows their way around the software.
167. All those that formally assist a claimant will need to be registered via the new registration process and then the claimant attaches through the CAPIS these agents to their claim to allow the agent to help and perhaps submit the claim form on behalf of the farmer. Given that the agent needs to be online ahead of the claimant, the RPA is contacting agents early in the process to get them on the system ahead of their farming clients. Agents are expected to be contacted from mid- October.
168. The NFU has asked the RPA for weekly updates going forward to ensure there is regular and timely communications, to ensure all elements of the industry are kept involved especially if farmer behaviour is not what was expected or plans have to change.
169. Third Party Software Accessibility / Offline Application Capability – The NFU has pushed for these alternatives to an online only application portal to help those with poor broadband access. Unfortunately we have been told by DEFRA that they will not support third party software accessibility for 2015 applications, no decision has been made for 2016 or later years yet. DEFRA have also stated they will not be developing for 2015 an offline version for 2015 application process. DEFRA are however building a greening calculator within the online software.
170. Letters to those under 5 hectares / entitlements – In September RPA issued c17,500 letters to claimants they believed had less than 5 entitlements and 5 hectares of eligible land to warn them of the changes to the minimum claim size moving from 1 ha under SPS to 5ha under BPS in 2015. The basis of the mailing out was on the SPS 2014 applications and did not take into account any transfers after that date. RPA put out a press release on this last week, the page is here. From an NFU perspective we want those holding these small numbers of entitlements to make them available for those who will be eligible in 2015 to claim BPS. Also the NFU wants such transfers of entitlements to happen prior to the 21st October SPS entitlement transfer deadline so that these small claimants do not have register onto the new IT or be impacted by the active farmer test involved in the transfer of entitlements from 2015.
171. Farmers holding Special Entitlements – By the time of NFU Council the RPA will be written to those that currently hold special entitlements. These are entitlements allocated in 2005 that started off with livestock farmers with a large pre SPS value to attach to the entitlements as they had little or no land in 2005. Under BPS there is no formal mention of these type of entitlements. These entitlements will convert to standard BPS entitlements in readiness for the first BPS claim. This has a number of consequences, not least the need going forward to have land to activate against these entitlements to receive payment. The NFU has been keen that this group of farmers are contacted specifically by the RPA.
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172. NFU Communications on CAP Reform – Basic Payment Scheme – We continue to provide online BPS information via our new dedicated www.nfuonline.com channel. The key is to keep SPS and BPS separate over forthcoming transitional period, especially as we continue to remind members about their SPS obligations and payment information. We also from the October 2014 edition of British Farmer and Grower have at least one page per month on CAP reform information in the magazine in order to communicate with all NFU members. We have also updated our well received CAP Essentials documents in late August following the CAP leaflet issued on 14th August. We are in the process of reviewing these documents in light of the developing situation and decisions. The revised editions will be available for our Autumn CAP roadshows as set out below and will be extended to cover CAPIS and more detail on Young Farmer Scheme, Active Farmer and National Reserve.
173. The NFU has ongoing activity planned to inform members of the latest developments which will tie in with the release of DEFRA/ RPA CAP guidance as set out below.
Document Release Date Method of Content Distribution Factsheet 3 Last week of Paper to all CAPIS Information / Young Farmer October farmers Scheme / Active Farmer / National Reserve / New Claimants / Entitlement / Some Greening Information (as stated above) Cross November / Paper to all Covering essentially the width of Compliance December farmers information in the 2014 cross compliance guidance Factsheet 4 1st December Paper to all Further Greening Information / CAPIS farmers information / BPS eligibility/ NELMS and CAP Policy Updates inc. Common Land
174. NFU Autumn CAP Roadshows – October & November - We have organised this October and November a further c40 CAP roadshow events covering the new Basic Payment Scheme, Greening, agri-environmental schemes around the country. The events kick off in the South West on 20th October and finish up in East Anglia on 28th November. The dates can be found here on NFU Online. We are highlighting the meetings in NFU Bulletin, and the October and November editions of British Farmer and Grower. Members are being asked to contact their regional office to book for a meeting. Finally, we are planning events for spring 2015.
High Speed 2
175. HS2 Phase 1 - Hybrid Bill: Further to depositing a petition this provides the opportunity for individuals, groups and organisations like the NFU to oppose the Bill or to seek its amendment by giving evidence before a specially-convened Select Committee in either or both Houses. We now believe we will be giving evidence to the Select Committee the week beginning 17th November 2014 along with the CLA. Some of our members will be giving evidence from the 14th October. We are waiting for the timetable from the 14th October to be released. The NFU has now instructed James Findlay QC of Cornerstone Barristers to act on their behalf when giving evidence to the Committee. Two meetings or conferences as they are called have been arranged with James Findlay for the 2nd and 15th October.
176. In September a very successful HS2 member meeting at Stoneleigh was held for almost 40 members and their land agents who have submitted a petition in regard to Phase 1 on how to prepare and give evidence to the Select Committee. Meurig Raymond chaired the meeting, Louise Staples gave an update on the latest issues from HS2 and the NFU parliamentary agent Alastair Lewis took members through the process of giving evidence. A video was also shown highlighting a petitioner giving evidence to the Committee so that members could see the setup of
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the room, where the committee sits and the QC on behalf of HS2. Further three of the NFU petition points were covered to highlight the problem, the solution and the evidence that will be needed to present to the Committee. Members have been offered the use of the London office as a base when they are due to give evidence and members will be able to apply to LAS individually for costs of using a land agent to present their evidence to the Committee. Each case will be looked at on its own merits.
177. The NFU along with the CLA and CAAV attended a NGO HS2 meeting for the first time on 10th September after asking to be part of the NGO group for the last two years. The other stakeholders involved include National Trust, Woodland Trust, Wildlife Trust, CPRE, Ramblers, Bucks County Council. We now feel that this will help us to give a much more balanced response to questions raised by HS2 in these meetings. Robert Goodwill MP attended the meeting and took questions. An announcement is likely to be made at the end of the year in regard to the route for Phase 2.
178. Meetings have been attended by Louise Staples in regard to the compulsory purchase scheme for the A14 with members who will be affected and the Highways Department who are the acquiring authority to raise members’ initial concerns. A meeting has also been held with the contractors who are carrying out a consultation on the East Coast Mainline Level Crossing closure feasibility. A response has been submitted by the regional county advisers for the different stretches of line affected.
Tenancy
179. The next National Tenants Group meeting will take place on 23rd October at Stoneleigh with Minette Batters attending and chairing the meeting.
180. National Liaison meetings have now been held with Duchy of Cornwall, Church Commissioners, National Trust, The Crown Estate and MOD. All meetings were attended by Minette Batters NFU Deputy President, Chris Cardell National tenants’ spokesperson and Louise Staples rural surveyor
181. Crown Estate: Ken Jones the rural and coastal portfolio holder attended along with three of his regional assistants. They are still working under the directive of driving the estate value by 5% per year. This is being funded by a mixture of rent increases, non-core sales and disposal of cottages (no longer reaching the current short term letting standards). Another consequence of this policy is that they are always trying to get land on to short-term lets (happy to accept 12 month roll on). By doing this, the farm appears on the books as open market value and helps the overall position reach the 5% target. In regard to tenancies they are now carrying out soil testing reviews at the start of new tenancies. It is also possible with the Crown to take a tenancy which is an FBT that has a base element to the rent figure and this is topped up by a variable element. They were very keen to work with Minette with ongoing issues around Tb policy and other current political challenges. We also discussed how some of our members on the Taunton estate were voicing some local concerns, We asked if Ken would visit the estate in the near future to answer any questions (this action point is ongoing).
182. National Trust: We were joined by a full NT team and Robin Milton, the NFU Uplands chairman, also joined the meeting. There is now a more direct move to have local agents back on the ground again, which is a positive move for tenants and landlord. They are also working on a new tenants handbook and overall vision--- possible release date later this autumn. NT is now moving more emphasis on to their "conservation" ideals. They have been carrying out a review for the last two years and now ready to release their new overall vision and start to put this vision in place. This takes the form of heavy lobbying on national greening issues (CAP) and also development of schemes on farm. We did stress this could lead to confrontation with some long- standing tenants who have traditional agreements and farm in established ways. NT are currently in the process of re-letting a 500 acre cliff holding in Cornwall, from the outset this will Page 33 Current situation in agriculture & horticulture: NFU Briefing
be let with full conservation ideals in place. It was emphasised to them the reduced profitability of extreme conservation liabilities and that this must be taken into account. The opportunity was taken to ask them to work on their tenant / landlord communication route including not just one to one meetings but to hold open meetings with all the tenants from an estate being invited. In regard to Tb controls, Patrick Begg (NT Rural Enterprise Director) explained he currently sits on Defra’s ‘TBeg group’ and while our approaches to control may differ, our aims of getting rid of the disease were similar. Minette took the chance to emphasise the industry representatives must drive the outcomes to this challenge.
183. Duchy of Cornwall: The rural estate is approx. 170,000 acres, making up 48% or the total portfolio. The remaining 52% falls under the commercial banner. They continue to run the estate in a traditional manner and HRH is very much involved in the running of the estate (with the Duke of Cambridge now becoming much more involved). We had a frank discussion about the general agricultural position and they were very interested to hear our thoughts on where the markets may go in the future. The change in viability of holdings after CAP reforms was also fully discussed. Like most estates they are now looking to carry out rent reviews in a 3 year pattern and assured us they had been modest. But when we challenged them, they admitted the now common picture of about 20% increases had been achieved. They continue to make land acquisitions and disposals where appropriate, but on farm investment has been reduced at the moment in favour of bringing the commercial sector up to grade (although they are currently looking to complete a deal on an additional 1,200acres here in Cornwall). Few of their farms come on to the open market to be re-let, due to being run traditionally and always looking to promote an existing family member (even looking to create succession rights within an FBT). Indeed this was very positive to hear a landlord say they had no problem with the modern FBT agreements, "as it only needs a willing landlord and tenant, and the agreement can be written to the mutual benefit of both parties They are currently involved in creating a few smaller starter units where the possibility arises.
184. Church Commissioners: The whole estate is 107,000 acres on 45 estates, covering approx. 350 holdings, large presence of about 20,000 acres in Kent. Overall the estate is approximately 60% being arable, 15% dairy, 8% horticultural and the rest being mixed. They currently have a large amount of capital to invest in land, but only where it fits their long term strategy (right land / right place). There are two main firms of land agents employed to carry out estate work, namely Smiths Gore and Strutt & Parker. In regard to rent reviews, they were also looking at an average increase of 20% on AHA agreements, and were reviewing FBT lets at £170 / £200 in the East. Again we did not discuss were the rent levels were starting from. Their justification was that they must achieve rents close to market trends, or they would fall foul of the charity investigators. Recently offered a block of 170 acres on the open market for tender applications in the NE and received over 50 applicants. We had a full discussion about drainage issues in the NW and also about the thorny issue of Fracking. We agreed to work closely on these points in the future.
Environment
185. The NFU has responded to a National Audit Office study into flood defence. We highlighted the importance of valuing both the benefits to ‘people and property’ but also infrastructure and agriculture when appraising flood risk management work. We would like to see the appraisal methodology used by Defra reflect the value of prime agricultural land to the UK’s food production sector and wider rural economy, in terms of jobs and sustaining economic growth. Amongst other things, our response also highlighted the need: To appraise the financial impact of long duration flooding, especially where extensive areas of land are flooded such as on the Somerset Levels. For greater transparency around what maintenance activities are conducted by the Environment Agency and their associated costs.
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For flexible Government funding that enables more sustainable local maintenance solutions to be delivered through local partnerships such as Internal Drainage Boards where the Environment Agency are seeking to withdraw from maintenance. To appraise the value for money provided by the Environment Agency’s current framework contracts for flood risk management; and For a better valuation of the costs associated with the permanent loss of land, such as within managed realignment schemes.
186. The NFU has responded to a Defra consultation setting out proposals for the regulations governing the Flood Reinsurance Scheme. The development of the ‘Flood Re’ scheme, where insurers pay a levy to subsidise the premium of high flood risk properties, aims to help underpin the availability of affordable household flood insurance which is helpful to both farmers and the wider rural community. Points made in our response included the need for ‘Flood Re’ to have sufficient independent public representation on its Board to represent the interests of the wider public taxpayer and those insured through the scheme and for the term ‘property flooding’ to be defined in the regulations to clarify that this does not apply to flooding on land.
187. The River Maintenance Pilots aimed at make it easier for farmers and other riparian owners to de-silt rivers themselves where they choose have been expanded by the Environment Agency. They have extended the existing pilots until mid-March 2015, expanded the River Idle pilot to include the larger Isle of Axholme catchment; and introduced two new pilot areas. There have been some tweaks to simplify the guidance and regulations under which farmers can undertake works in the pilot areas. The NFU has welcomed these changes aimed at maximising the outcomes the pilots deliver and opportunities for farmers and others to undertake such works.
188. Following some serious incidents involving walkers and livestock, the NFU is continuing to promote simple messages through the Love Your Countryside Campaign on considerate and safe dog walking. In addition, the NFU and Ramblers have reaffirmed the joint messages we issue to walkers, and agreed that a better evidence basis around any incidents involving cattle and the public is needed before any changes to legislation could be considered. We have agreed to jointly write to the HSE to enquire about what further evidence could be collected following severe and fatal incident involving livestock. The NFU has also promoted the relevant Business Guide 407 to farmers.
189. The De-regulation Bill, including reforms to unrecorded rights of way, is continuing to make its way through the House of Commons and is expected to proceed to the House of Lords. A Defra Stakeholder Working Group including the NFU, CLA and user interest groups is continuing to discuss a series of issues raised in our response to the draft Bill including: A better process and balance for diversions and extinguishments of existing rights of way; Extending powers to authorise gates and structures on rights of way; Improving the quality of evidence where rights of way are claimed by users; Time limit on claims of long usage.
190. Defra has published its summary response to the consultation ‘Making the most of every drop’, the first public phase of government’s water abstraction reform proposals. The NFU position on the reform options focuses on our demand for equality in the way that all water users are regulated, and a fair share of water to be allocated for food production. Defra proposals focus on a shift from ‘seasonal entitlement’, as in current licences, to a system that will more closely link water use to current availability. Guy Smith, the NFU’s Vice President, met the Defra Minister Dan Rogerson in July and that meeting has been the catalyst for further Defra/NFU meetings which have examined financial and planning system barriers to reservoir construction. Defra will take a final policy view on reform implementation in spring 2015 and an enabling Water Act is expected early in the life of the next government.
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191. Defra has again delayed its plans to implement regulations to bring in new authorisations, including trickle irrigation, within the abstraction licensing regime. A public consultation is expected shortly with regulations to bring trickle irrigation (and other ‘exempt’ licensing activities) expected in 2015. The Defra water team responsible for licensing trickle met with the NFU at a meeting organised by the West Sussex Growers Association in September. At that meeting, the NFU stressed that we are keen to ensure that the provisions for trickle irrigators are as fair, simple, appropriate and proportionate as possible.
192. The NFU is involved in supporting a renewal application for abstraction licences in Catfield, Norfolk. The farmer applicant is at risk of falling foul of the Water Framework Directive ‘precautionary principle’; or at least the way that it is interpreted and implemented by UK government and its agencies. The Environment Agency must be satisfied that the abstraction is having no adverse impact, a very difficult test to satisfy when the condition of the local SSSI could be attributed as much to site management as abstraction. We are closely monitoring the case and are keen to ensure that no important precedent is set that could impact on other growers. A public consultation is due to be launched in late October, and Guy Smith, the NFU Vice President, visited the site on 9 October 2014.
193. The NFU is discussing with Defra and the Environment Agency the proposed introduction of a new policy to review abstraction licence renewals subject to a Water Framework Directive ‘no deterioration’ test. Any new policy will be implemented first in the Anglian region where 400 licences in the Cam & Ely Ouse catchment are due for renewal in 2015. Fenland licences will not be affected because the water courses are not natural, but rivers will be. And there is major concern about groundwater. Our concern is that farmers currently expecting their licences to be renewed as usual may lose ‘clawed back’ volumes of water which they currently depend on in times of scarcity.
194. Defra has asked the NFU for informal views on the next review of the Nitrates Regulations. We have stated the need for a full review of the methodology used for designation but Defra state that there is not sufficient time to fully review the science underpinning NVZ designations in advance of the new rules being in place for 1 January 2017. Various options for 2017 designations are being discussed over the coming months.
195. All appeals from the 2013 NVZ designations have now been finalised after a protracted appeals process. The NFU will be assessing the lessons learned from the appeals in order to push Defra for a review of how NVZs are designated.
196. A Defra consultation on changes to SSAFO regulations is expected to be part of the NVZ consultation. The NFU has seen some of Defra’s early thinking on “Condition Assessments” for slurry, silage and fuel oil stores and will be working to ensure that a tick-box exercise is not created. The consultation is also expected to cover definitions and harmonising some elements of SSAFO and NVZ rules.
197. The Government response to Defra’s consultation on regulation of discharges from septic tanks has still to be published. Defra proposed to replace registration with "General Binding Rules" that small sewage treatment plants must comply with. In our response we noted that we are in favour of de-regulation of the registration system but raised some concerns where we think proposals could go further. A key point was the need for clear and easy to understand rules alongside fair and proportionate enforcement. The full response can be found on Nfuonline.
198. The NFU is participating in a Defra project looking at agriculture’s impact water quality. The project is considering agriculture’s impact on the water environment including reviewing the evidence base, actions required and how to implement the practices required to meet Water Framework Directive objectives. We are expecting a consultation in the December which will consider regulation, incentives and voluntary activity.
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199. Following the Ministerial Summit on Water Quality and Agriculture in July, the NFU has been working with industry partners to produce a credible plan for industry-led, voluntary activity towards reducing diffuse pollution impacts. The industry intends to offer to work with Campaign for the Farmed Environment to target messaging on specific water quality issues, to work together as the agricultural industry to communicate messages on water quality and to work with partners to demonstrate impact of our work. Plans are in development and are expected to be submitted in December to be incorporated into Defra’s consultation (see paragraph above).
200. Updated River Basin Management Plans (RBMPs) are out for 6 months consultation from 10 October. These will update the 2009 plans and set objectives for water bodies towards meeting “good ecological status” by 2021 or 2027. Diffuse pollution from agriculture is expected to feature in all regions and the NFU regional offices will be responding. We are also currently working with the Environment Agency to understand how affordability to agriculture is being considered in the economic assessment of Water Framework Directive objectives as this will factor into the Ministerial decision.
201. AHDB are proposing a new way of updating the Fertiliser Manual (RB209) to ensure that new research and recommendations are incorporated into recommendation tables. The NFU were generally supportive of the approach since Defra would not be updating the manual for a number of years leading to out-of-date information in some areas. We expect to be part of the discussions should AHDB’s proposal be accepted.
202. Although the European Commission only withdrew its proposal for a Soil Framework Directive in May this year, at a conference in Brussels in June the Environment Commissioner Potocnik stated that the Commission ‘remained committed to the objective of soil protection and will examine options on how to best achieve this’. During his speech, Potocnik examined soil threats such as soil sealing, contamination and intensification of agriculture and forestry and also set out 4 axes of how to achieve ‘prudent and rational’ use of land. These included addressing land take, preventing land degradation, encouraging the use of regenerated brownfield land, and addressing the impact EU policies on land degradation outside of the EU. It is expected that the Commission will issue a Communication document in 2015, the International Year of Soils, setting out its new proposals.
203. Defra has announced the new soil GAEC standards which will replace the Soil Protection Review. Disappointingly, Defra has ignored feedback received from the NFU and its members and opted for a zero paperwork approach which will be inspected in-field by the RPA. We have recently (15th September) held a workshop with the Defra Soils team and our Members Soil Group to further discuss our concerns and continue to assist in the drafting of the new GAEC standards and accompanying guidance. We are in the process of arranging a follow-up meeting with Defra and the RPA to discuss how these GAECs are to be implemented.
204. From 15th July 2014, all poultry farmers across the EU will be allowed to combust poultry litter on-farm to create energy. The issue has been the subject of sustained NFU lobbying over several years. This change will allow poultry litter to be combusted under the Animal By-Product Regulations as opposed to the Waste Framework Directive therefore reducing regulatory burden. This means that the regulatory authority has changed from the Environment Agency to AHVLA. The NFU continues to work with Defra, the Environment Agency and AHVLA to ensure the transition goes as smoothly as possible. The NFU along with Nigel Joice (member) and BHSL met minster George Eustice on the 15th July 2014 to discuss the recent EU lobbying success on the combustion of poultry litter on farms.
205. Deputy President, Minette Batters, and Environment Policy Adviser, Anna Simpson, gave oral evidence on the 2nd July 2014 to the EFRA (Environment, Food and Rural Affairs) Committee inquiry into Waste Management in England. Our interest in the above inquiry is due to the impact waste management has on the agricultural sector. The waste management process can be challenging for many of our members in rural communities, who have a lack of disposal options Page 37 Current situation in agriculture & horticulture: NFU Briefing
available due to limited infrastructure and collection services. Key points within the NFU evidence included: The need to improve the availability of facilities and minimising costs for recycling or disposal of waste Utilisation of waste food and biowaste via anaerobic digestion has multiple environmental and economic benefits to the agricultural industry. Fly-tipping and the problems faced by landowners.
206. The Environment Agency has clarified that biogas producers will no longer have to register an exemption or pay for a permit in order to use fruit and vegetable by-products in the anaerobic digestion (AD) process. The new briefing note differentiates crop residues from food waste when used for AD. The NFU has lobbied for clarification of the regulations in order for producers to use AD technology for farm residues with as little regulatory burden as possible. Until now the inclusion of even a small quantity of these by-products into the AD process required farmers to apply for expensive permits, and to implement the same waste handling controls as a commercial food waste AD plant.
207. The ‘BREF’ is the European guidance document for the IPPC pig and poultry sectors. It outlines Best Available Techniques (BAT), or best practice, covering a range of activities on farm which must be transferred into guidance (e.g. ‘How to Comply’) in England and Wales and enforced by the Environment Agency (or Natural Resources Wales). The BREF was last updated in 2003 and is now being revised. The NFU and industry have submitted comments on the key proposals of the revised BREF. We have been informed by the BREF authors that the final Technical Working Group should be expected 17th – 21st November 2014.
208. The NFU has hosted two meetings with the industry and Defra to discuss the implications of the revision of the National Emissions Ceilings Directive proposing new reductions in ammonia emissions by 21 per cent in the UK by 2030. This new target is expected to be very challenging, particularly for the livestock sector. An industry working group has been initiated to look in more detail at the current baseline; establish the agronomic and business impact of the current EU proposals (on a sector by sector basis); and suggest a package of measures which may be more practical and cost effective. Negotiations on the proposed changes to the Directive have still to begin in earnest at an EU level, but the NFU met the lead rapporteur, South West MEP Julie Girling, earlier this year.
209. A large part of Defra’s response to the CAP consultation, published in February, covered the New Environmental Land Management Scheme (NELMS). NELMS will replace the current agri- environment schemes. Defra’s consultation response outlined that the scheme objectives will be focussed primarily on delivering biodiversity, followed by water. The NFU has commented on NELMS proposals for a baseline, a universal capital grants offer and a facilitation fund. A current summary of NELMS as it develops is available here.
210. The June CAP announcements outlined how existing agreements would be affected by the introduction of greening, more specifically EFAs. Standalone ELS (including OELS) agreements with a start date of 1st January 2012 or later will have their agreements adjusted. This affects about 4,000 agreement holders, who will have the choice to walk away from an agreement with no penalties, amend the agreement to add in new options or accept a lower payment.
211. Natural England has written to agri-environment agreement holders to outline changes to payment timings. For many this will impact on cash flow in 2015. For 17,000 agreement holders it will be a negative impact. This change is a result of the Defra’s decision to align all agreements with the universal start date of 1st January following Government paying disallowance fines to Europe. Bespoke letters will go agreement holders in December. The NFU has made several requests to improve the position for badly affected farmers.
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212. The England Biodiversity Strategy (EBS), launched in August 2011, is being used as the foundation to guide conservation efforts in England over the next decade, including setting ambitions to halt overall loss of England’s biodiversity by 2020. The NFU responded to Defra’s green paper consultation on biodiversity offsetting last November. The NFU was against the proposals, as were many other organisations, if for different reasons. The proposals would require developers to replace biodiversity lost through the development through an offset. Defra have now said they will wait for the outcomes of the biodiversity pilots before making any policy decisions.
213. Natural England has undertaken a review of upland evidence that relates to the evidence on biodiversity and ecosystem services in the uplands, and the impact of land management activities upon them. The NFU has met with Natural England to discuss the evidence review findings and to establish how these may feed in to revised guidance and advice. The NFU is engaging in the guidance development with a view to ensuring that farm production is taken in to account.
214. The NFU responded to the Natural England consultation on wildlife licences (including the controversial ‘shoo before you shoot’ proposals). The consultation was on new complex requirements which make them more complicated and place a greater administrative burden on businesses and Natural England, the regulator. This was against the Government’s principles of ‘reducing red tape’. Following the consultation Natural England have dropped many of the proposals.
215. The Queen’s speech outlined proposed legislation on Invasive Alien Species and elections to the National Parks and the Broads authority. The draft Infrastructure Bill contains Species Control Orders to manage Invasive Alien Species. The NFU responded to the Law Commission proposals on Species Control Orders expressing concern about the powers this could give Government Agencies to enter land to control IAS. With the proposed changes to the National Park and Broad authority selection process the NFU want to ensure agricultural interests are represented on the Boards, given the significant impact they can have on agricultural businesses.
Climate Change & Renewable Energy
216. The NFU responded recently to an Adaptation Sub-Committee call for evidence on the Committee’s approach to reporting to Parliament on the National Adaptation Programme. The Sub-Committee sets the direction for adaptation matters including independent advice on preparing for climate change. In its response the NFU asked for greater clarity on some of the ASC proposed indicators and highlighted gaps in the proposed indicator set. It will be important to agree on a set of indicators that adequately reflect the impact that climate and in particular extreme weather has on farming.
217. The NFU also replied in August to the Environmental Audit Committee’s Climate Change inquiry. Our response highlighted that assessments of the risks and opportunities to UK agriculture from climate change were incomplete. We asked for more work to be done in assessing and addressing cross-sectoral issues like water and for a genuine culture of knowledge exchange between research, industry and farmers and growers in delivering innovation, new practices and technologies fit for an uncertain future. We called for more impetus and less complacency if the UK is to realise its potential “comparative advantage over food producing regions at lower latitudes as the climate changes and increases the importance of the UK as a food-producing nation.”
218. In September, the NFU added its voice to those of other business leaders setting out what the UK wants from the climate talks in Paris next year, when it is expected that a new global agreement to tackle climate change will be signed. We contributed to the government document “Paris 2015: Securing Our Prosperity Through a Global Climate Change Agreement”. The NFU called for strong scientific evidence on which to base agriculture’s inclusion in any new international agreement and highlighted that NFU members are already are already taking action Page 39 Current situation in agriculture & horticulture: NFU Briefing
to reduce their emissions through the Greenhouse Gas Action Plan and by exporting low-carbon energy to other sectors of the economy
219. The Greenhouse Gas Action Plan, of which the NFU is a member, published its report last month on a possible new vision for low carbon farming. Significant gaps in research and knowledge were identified, like the need to consider the fate of legumes in livestock and their impact on methane emissions, and what is the scope for supply chain product specifications to help deliver on-farm mitigation. There were recommendations for all attendees; for example, the workshop called on policymakers to recognise that the mitigation potential of agriculture cannot be considered in isolation from the impacts of a changing climate and from the need to produce food for a growing global population.
220. In August, the NFU submitted a robust response to a recent DECC consultation on 'Underground Access for the Extraction of Gas, Oil or Geothermal Energy’. We remain concerned about the possible indirect impacts of shale gas exploration and development on the agricultural industry, and do not believe that unconventional oil and gas operators should gain access to underground land more easily if this is to the detriment of landowners. The NFU can see that a statutory right of access is probably needed, but this should only be on the basis that each landowner is notified that drilling is taking place underground and individual compensation is made to each landowner, and it should apply below a depth limit of 1000 metres, not 300 metres as proposed. We do not agree with proposals to pay compensation only to a “relevant community body”.
221. NFU Chief Adviser on renewable energy Jonathan Scurlock met with the Chief Executive of the Renewable Energy Association over the summer, together with their Policy Director and Head of Public Affairs. On the agenda was the Government ambition for various renewables by 2020 and 2030, including the likely role of electricity storage. Also discussed was the expected contribution from a diversity of bioenergy technologies, and notably the need for domestic feedstock supply as well as imported resources, although biomass electricity is presently dominated by the substantial imports of wood pellets used by Drax power station.
222. Voluntary guidelines for using crop feedstocks in anaerobic digestion were published in September by the Anaerobic Digestion and Biogas Association together with a coalition of the NFU and other trade associations. Defra and industry stakeholders are in agreement about the value of advocating practices which address possible environmental risks in the production of maize, beet, triticale and other AD crops, drawing upon existing good farming guidance. Under Secretary of State Dan Rogerson MP formally welcomed the Best Practice Guidelines in a foreword to the document.
223. The government has proposed extending permitted development rights to large solar roofs up to one megawatt in size, in an important move to encourage more rooftop solar power in the agricultural, industrial and commercial sectors. This is part of a wider consultation over the summer by the Department for Communities and Local Government on “Technical Planning Issues”. In its recent consultation response, the NFU welcomed this policy measure and sought clarification on this additional class of permitted development (beyond the existing 50- kilowatt limit), which should mean that in most cases solar roofs up 20 times the present size limit will no longer require formal planning permission.
224. New guidance compiled by the NFU and the BRE National Solar Centre shows how ground- mounted solar farms can be combined with continued agricultural land use for small livestock such as sheep, chickens and geese. ‘Agricultural Good Practice Guidance for Solar Farms’ explains for the first time how coupling conventional agriculture and field-scale solar power offers new opportunities to optimise land use for both food and energy production. The guidance document describes experience from on-farm case studies as well as general principles of good practice to integrate solar installations into the rural economy, complementing existing advice on the management of biodiversity in solar farms. It has been proposed that the presence of Page 40 Current situation in agriculture & horticulture: NFU Briefing
livestock, where solar farm agreements maintain the land 'at the disposal' of the farmer, could allow the land to eligible for the Basic Payment Scheme from 2015. However Defra is still reviewing the BPS rules and has not yet made a final decision on eligibility of grazed solar farms.
Legal
225. The Legal Affairs Team continues to provide legal advice to support the NFU’s work on key policy issues such as bTB (including continuing work relating to the injunction referred to in previous updates, and work in relation to the two pilot area schemes) and CAP Reform.
226. The Team is still waiting to hear from the European General Court as to whether the NFU will be granted permission to intervene in legal challenges launched in the European Courts by Syngenta and Bayer respectively against the European Commission’s Regulation which contains restrictions on the use of neonicotinoids. The applications for the NFU to intervene in the two legal challenges were sent off to the European General Court just before Christmas. Further detail can be found on the Science and Environment pages of the NFU’s website.
227. The Team is providing legal support to NFU members across the country in relation to flooding issues, in particular the legal background to the management of flood risk assets.
228. The Team continues to work on the review of the Dairy Voluntary Code of Practice on Contracts, and a member of the Team has attended the review meetings with the Independent Chair.
Legal Assistance Scheme
229. The Legal Assistance Scheme (LAS) continues to make significant financial contributions towards subscribers’ professional fees incurred as a result of disputes arising from their farming/growing businesses. The dedicated team of advisers also continue to provide professional guidance and moral support to the farmers/growers whilst they go through these difficult and stressful times.
230. From 1 November 2013 to 30th September 2014, a total amount of £1,822,607.85 has been granted to members. Within that figure, £22,304.00 was allocated to the Scheme’s Tenants’ First Advice Service where each tenant who has applied has received up to a maximum of £500 towards the cost of obtaining budgetary advice following receipt or service of a rent review notice. It has been noted that many tenants are finding this special service very helpful towards rent review negotiations with their landlords and/or their agents. £16,189.10 was awarded towards costs incurred in inter-member disputes to help resolve matters between members in a more amicable, less stressful and more cost-effective way.
231. The total number of new referrals received by the LAS Team from 1 November 2013 to 31st August was 824. This includes referrals from CallFirst, group secretaries, regional staff, solicitors and via members direct to the LAS Advisers. Out of these referrals, 280 files have been opened with awards granted to the applicants; the rest are pending whilst we await further information and/or clarification from the applicants or their professional advisers, with a very limited number falling outside the scope of the Scheme.
232. Group Cases - We continue to offer financial support and professional guidance to members in a number of “group” cases affecting individuals, small, medium and large sized businesses. Brief updates on some of these cases are outlined below. We coordinate the cases to help our members, to avoid duplication and to eventually save both members’ pockets and the Scheme’s purse whenever possible. The LAS team’s involvement helps in dealing with matters in a more efficient and cost-effective way – this also helps in the retention of members and occasionally, we are also able to recruit new NFU members during the process in some cases.
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Report on on-going national cases
233. bTB related issues – The LAS continues to support the members affected by the outbreaks in Cumbria and the West Midlands. In Cumbria, the seller is trying to resolve the contractual issue with the buyers via the auctioneers. In West Midlands, Defra responded to the letter before action sent upon Counsel’s advice, refuting the member’s arguments for discrimination against non-bovines in respect of compensation for TB. The policy decision has now been made not to proceed with the JR action, but a letter has recently been sent to the Secretary of State by the Deputy President raising NFU’s concerns on behalf of the goat industry and the need to have a clear Government policy in terms of testing, and particularly compensation for bovine TB in goats as soon as possible, in order to re-build confidence in the industry. In the meantime, the member’s solicitor continues to liaise with Defra, FSA and AHVLA on how best to resolve matters. The LAS team continues to provide support towards the member’s costs.
234. HS2 – The Legal board has agreed to make contributions towards professional costs to be incurred by members who are unable to make their own representations before the Select Committee (e.g. due to the complex nature of their case) and wish to use professional advisers to assist them in doing so.
235. Dispute with Nationwide Corporate Finance Ltd – This is the case where the LAS has given significant support for its panel firm, Clarke Willmott, to investigate whether our members were aware of the implications of entering into a financial arrangement or whether there had been misrepresentations made by the company in providing “loans” for our members, which have now resulted in a sale and leaseback of their farm machinery. Counsel has reviewed the initial findings of the subject access requests and further detailed statements are being obtained from some of the members to give a better idea of that really happened. Counsel will then advise on “next steps”. The LAS continues to work with Clarke Willmott Solicitors to assist our members affected by this problem.
236. Somerset Flood Levels and Minsterworth Flooding – A conference with Counsel took place in June with some of the affected members (from Somerset) present. Additional information was requested to help Counsel formulate his final Opinion. In the meantime, Counsel also considered the initial report provided by the expert for the Minsterworth flooding case. A meeting was organised by the group in Minsterworth where representatives from the Environment Agency gave a presentation on the work they are currently undertaking. Consideration is being given as to which of the two cases may become the best “test case” if a legal challenge is to be pursued in view of Counsel’s Opinion. Work continues on the policy front at regional level on both cases. The LAS continues to support the affected members in Somerset and Gloucester. Clarke Willmott firm is advising the members on both cases.
237. Flooding of carrot field in the North East – This case continues with support from the LAS. East Riding of Yorkshire Council failed to respond to the letter before action within the required period, so Counsel has settled the particulars of claim and proceedings have been issued. The Upper Tribunal (Lands Chamber) has acknowledged receipt and informed the member’s solicitor (from panel firm Crombie Wilkinson) that the case has been entered on the Register for consideration by the Registrar in due course. We are yet to hear from the Council, its insurers and/or solicitors. The member also has NFU Mutual legal expenses policy underwritten by DAS – they have agreed to pay for costs in pursuing. However, given the national interest, the Legal Board has agreed to also fund 50% of the member’s own costs to allow the NFU to be involved in the conduct of the case with advice from solicitors from Crombie Wilkinson, legal panel firm.
238. Other Flooding Cases – Work continues with various flooding cases around the country (e.g. Avon Valley Weeds, Bottesford Beck, etc), with advice to members by panel firms including Thrings, Wilkin Chapman, with financial assistance from the LAS and in one case, via NFU Mutual/DAS.
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239. Dispute with Freshways – A number of members contacted NFU CallFirst and were put in touch with the LAS team, having received notification from Freshways about backdated deductions from payments due to them for apparently “low quality” milk supplied to them during the past few years. There was a conference with Counsel on the issues arising from this case and a letter before action was sent to Freshways on behalf of one of the affected members. The solicitors (panel firm Shakespeares) are currently liaising/negotiating with Freshways’ solicitors to find an amicable solution to the problem. The Legal Board continues to support the affected members with the legal costs.
240. Taxation matters - Agricultural Exemption for Business Rates – This case is about a member who was successful in his appeal against the Valuation Officer at the Lands Tribunal on his claim that his business should be classed as a market garden for the purposes of the agricultural exemption from ratings. The Valuation Officer then successfully appealed against this decision. The member and his legal team decided to appeal against the current decision to the Court of Appeal following a successful request for permission to do so and with support from the LAS. The Grounds of Appeal have now been filed with the Court of Appeal. The case and its potential implications on the wider industry have been carefully considered by both Policy and Governance Boards, as well as the Legal Board.
241. Abstraction Licenses - The LAS is currently liaising with the policy team at HQ and Paul Hammett on a number of issues arising from a dispute a member has with the EA and Natural England in relation to Abstraction licences in a SSSI area in East Anglia. Support is being considered towards the costs of obtaining the relevant expert’s report to support the member and possibly the wider membership.
242. Dispute about HEAR OSR – A number of members have contacted CallFirst regarding a problem arising from their existing HEAR OSR contracts with a company. They have been referred to our panel firm, Tees in East Anglia. A letter before action has been sent to the company on their behalf. It is anticipated that this will be settled amicably with the company involved. The LAS is providing funding for the work that is being undertaken on the members’ behalf.
243. Dispute on Pesticides – A number of members are involved in a dispute in the North East with a company that provides a pesticides advisory service and supply the package to growers. It is being argued that the agronomist has allegedly given wrong advice regarding the product which has resulted in low yields and losses for the members. Our panel firm, Crombie Wilkinson is currently advising the affected members, some of whom have already entered into negotiations with the company.
244. Fly-grazing – The LAS team continues to work alongside the Policy Teams, Compliance and other Business Services teams to provide a specialist service to assist members with fly-grazing problems. There was a meeting of the working group in August to consider the package and how best to deliver the same to members. Work continues on this in the next few months.
245. Various Counsel’s Opinions – The LAS has paid for a number of counsel’s Opinions following request from the legal affairs teams to clarify the legal position on certain policy issues (e.g one on Prohibited Sites), as well as for national cases involving groups of members to help ascertain their initial legal positions (e.g. dispute with Severn Trent on compensation payable for undertaking works on their land).
246. Other cases – Work is still on-going on a number of other group and individual cases raising particular policy issues.
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LAS Pilot Review
247. The remaining nine firms have now joined the first seven that started the pilot - we “went live” on the 28th of July 2014.
248. As at 30 September 2014, 163 referrals had been made under the pilot with 67 of those having awards made by the Panel Firms.
249. There was a special insert in the F&G Renewal Pack highlighting the changes to LAS Applications and the benefits of the same. With effect from 1 November 2014, all LAS Applications will be made via NFU CallFirst to make the process easier, quicker, more cost- effective and to monitor the same.
250. The changes have also been mentioned in the October edition of BF&G and will be in the November edition of Farming Wales.
251. The revised Governing Rules of the Scheme, Terms and Conditions for subscribers and other relevant documentation (e.g. Appeal process and Eligibility criteria) about the Scheme will be available on nfuonline on the LAS pages.
Legal Panel Firms
252. Discount - Value of discount offered by the Legal Panel Firms from 1 November 2013 to 31st August is circa £65, 293.
253. The firms continue to assist members and a number of national cases including; Somerset Levels flooding, Minsterworth flooding in Gloucester, Interest Rate Swaps, Dispute with Nationwide Corporate Finance Ltd., TB outbreak cases, Pesticides Dispute, Dispute on HEAR OSR etc.
254. The solicitors have also attended NFU shows round the country, offering their services, sponsorship and support to the NFU and our members.
Tax
255. The NFU has again raised concerns over the design of Universal Credit which will replace working tax credits. In particular we believe that the rules for assessing the profits of self- employed individuals are deeply flawed in relation to those with fluctuating levels of income and expenses, such as farmers. We recently participated in a roundtable discussion with the Department for Work and Pensions (DWP), the Social Security Advisory Committee (SSAC), Low Income Tax Reform Group and others and understand that the DWP are actively considering setting up working groups to look at how the rules might be improved. We will participate fully in these to ensure that farmers are not excluded from accessing what is often an essential welfare safety net.
256. The NFU has engaged with the Treasury over a proposal to restrict entitlement of personal allowances for income tax purposes to individuals resident in the UK. This could result in many seasonal migrant workers suffering a flat rate income tax deduction of 20% on their entire earnings. We are concerned that if this proposal goes ahead it will act as a deterrent for migrant workers from taking up seasonal work in the UK. We question how the UK government will ensure compliance and the extent to which it may seek to rely on employers to monitor the residence status of their employees. We also question the extent to which any additional tax revenue will be mitigated by the significant increase in compliance costs for employers and Page 44 Current situation in agriculture & horticulture: NFU Briefing
government alike and additional welfare entitlements. We are currently preparing a formal consultation response.
257. We have engaged with HMRC on the extension of the Annual Tax on Enveloped Dwellings. This currently applies to residential property worth in excess of £2 million held within a company or mixed partnership, but is to be extended to residential property worth in excess of £500,000. The policy rationale for this new tax was to counter Stamp Duty Land Tax, but the rationale for this extension is unclear. We have questioned why many more properties cannot be exempted, for example those owned since before the introduction of SDLT. We have also called for significant changes to the reporting regime where reliefs apply, such as the relief for farmhouses, as we believe the current system is both costly and burdensome.
258. The NFU’s Head of Tax is a member of the joint PAYE RTI task force working with senior HMRC officials to address implementation difficulties. We have continued to engage extensively with HMRC, particularly in relation to issues affecting seasonal employers. We were therefore pleased with HMRC’s decision to phase in RTI penalties for late returns, which were due to commence from 6 October, but which will not now apply to smaller employers until March 2015. This allows smaller employers more time to ensure they are reporting on time. We will however continue to call for a permanent reduction in the frequency of reporting for seasonal employers.
259. The NFU has spent some time discussing the rules of the VAT – DIY self-build scheme with HMRC, particularly in relation to the conversion of farm buildings to residential use under new permitted development rights. Having originally suggested that the lack of specific planning permission might prevent such conversions from inclusion in the scheme and from VAT recovery, HMRC have now agreed that they can qualify. We understand that formal guidance and changes to the DIY claim form/VAT legislation are currently being prepared by HMRC.
260. The NFU engaged with the Office of Tax Simplification during their review of employment tax, and in particular the tax treatment of employee accommodation. We made our views clear that any proposals for simplification must also ensure that existing exemptions for agricultural workers who need to be located on or near the farm are retained. The Office of Tax Simplification has now published its final report and suggested how the rules might be simplified. The NFU will be making a formal response shortly.
261. We have included four specific tax issues within our HS2 petition in an attempt to ensure that any tax costs incurred as a direct result of a compulsory purchase order (CPO) are mitigated. These include calling for an exemption from capital gains tax or an extension to the rollover rules and ensuring that the compensation includes any Inheritance Tax or Stamp Duty Land Tax costs incurred as a direct result of a CPO whether in relation to in hand or let land.
262. The Chancellor will deliver his final Autumn Statement of this Parliament on 3 December. The NFU is currently preparing its submission which will be based on policy asks within our manifesto, concentrating in particular on the need to bring forward investment for long term growth.
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