Cynulliad Cenedlaethol Cymru

Yn ôl i Chwilio

Y Pwyllgor Newid Hinsawdd, Amgylchedd a Materion Gwledig

Climate Change, Environment and Rural Affairs Committee

06/12/2018

Aelodau'r Pwyllgor a oedd yn bresennol

Committee Members in Attendance

Andrew RT Davies AC
Gareth Bennett AC
Helen Mary Jones AC
Jayne Bryant AC
John Griffiths AC
Joyce Watson AC
Llyr Gruffydd AC
Mike Hedges AC Cadeirydd y Pwyllgor
Committee Chair

Y rhai eraill a oedd yn bresennol

Others in Attendance

Lesley Griffiths AC Ysgrifennydd y Cabinet dros Ynni, Cynllunio a Materion Gwledig
Cabinet Secretary for Energy, Planning and Rural Affairs
Tim Render Cyfarwyddwr Arweiniol dros yr Amgylchedd a Materion Gwledig, Llywodraeth Cymru
Lead Director for the Environment and Rural Affairs, Welsh Government

Swyddogion Cynulliad Cenedlaethol Cymru a oedd yn bresennol

National Assembly for Wales Officials in Attendance

Katy Orford Ymchwilydd
Researcher
Lowri Jones Dirprwy Glerc
Deputy Clerk
Marc Wyn Jones Clerc
Clerk

Cofnodir y trafodion yn yr iaith y llefarwyd hwy ynddi yn y pwyllgor. Yn ogystal, cynhwysir trawsgrifiad o’r cyfieithu ar y pryd. Lle mae cyfranwyr wedi darparu cywiriadau i’w tystiolaeth, nodir y rheini yn y trawsgrifiad.

The proceedings are reported in the language in which they were spoken in the committee. In addition, a transcription of the simultaneous interpretation is included. Where contributors have supplied corrections to their evidence, these are noted in the transcript.

Dechreuodd y cyfarfod am 09:31.

The meeting began at 09:31.

1. Cyflwyniad, ymddiheuriadau, dirprwyon a datgan buddiannau
1. Introductions, apologies, substitutions and declarations of interest

Can I welcome everybody to this meeting? As far as I'm aware—well, I'm just looking round; everybody is here, so we've got no apologies. Can I welcome everybody? Croeso cynnes iawn. I remind people to set their mobile phones to silent and to turn off any other equipment—electronic equipment—that may interfere with broadcasting equipment. Any Members to declare any interests? None? No. 

4. Trafod Bil Amaethyddiaeth y DU: sesiwn dystiolaeth gydag Ysgrifennydd y Cabinet dros Ynni, Cynllunio a Materion Gwledig
4. Consideration of the UK's Agriculture Bill: evidence session with the Cabinet Secretary for Energy, Planning and Rural Affairs

And, as there are no apologies and substitutions, if you're happy, Minister, we'll move straight on to questions.

Yes, that's fine.

The first one's from me, regarding the red meat levy. Amendments to the Bill include Part 8, which contains provisions on the red meat levy. Are you content that these provisions will enable the establishment of a fairer system of redistribution of the red meat levy?

Yes, I am now. It was very important, I think, that we took the opportunity to rectify the long-standing issue of repatriation of the red meat levy by using the UK Agriculture Bill. I would have liked to have seen it on the face on the Bill, and then I said I wanted a Government amendment, and that's what we've got, we've got the Government amendment, so I am happy now. It was an absolute red line with me, because I think it's wrong that we're losing £1 million a year, and I am pleased now with what we've got. So, when we've sorted out the other red line, which is the WTO issue, I'll then be able to recommend the legislative consent motion to the Assembly.

We'll come on to that later. Given the changes to the Bill, will there be a supplementary LCM, and, if so, when will it be laid?

It's quite hard to tell you a date when. We've seen changes as it's gone through the Commons; I'm sure we'll see changes as it goes through the Lords, so I think—you know, I wouldn't want to bring an LCM forward unless we were sure that that was the stable text that we had. It could be that, after that, there would have to be others. So, it's a bit hard to say when we'll be laying it. I think it's prudent to wait for all the changes as it goes through the Stages before we do that.

Yes, just very briefly. I was very glad to see that there was some kind of provision in terms of transferring the funding, but, of course, we're no nearer understanding what the mechanism will be, how that decision will be made, when it'll be made, and I'm just wondering—. You know, it might have been a big ask to have something on the face of the Bill, but, certainly, are we closer in that respect? Because your bullish mood that we're now finally sorting this out, well, we're not on the—. We're creating the ability to sort it out, but we're far from having sorted it out, really.

In answer to your question, what will happen is Michael Gove will write to me with—you know, setting out everything. Obviously, when that exchange of letters takes place, we'll be able to give more information. I know officials have been working really hard on the two areas that, for me, were complete red lines. I'll ask Tim to say a bit more about the red meat levy and where we are.

On the red meat levy, we've been working with officials in the Department for Environment, Food and Rural Affairs in the other parts of the UK and with the Agriculture and Horticulture Development Board, which, at the moment, obviously, holds the levy, on how we do that and what mechanisms we do. We haven't finalised the mechanisms; that's still work in progress. But people are working to—. We all know where we want to get to and we want to get to the same place, so it's about how we do it.

09:35

But we haven't had the powers before to do it.

So, we've got an interim solution, obviously, at the moment, which helps, but it will be—. And we wouldn't want to put too much really firm mechanism in the Act, because that then ties us to that mechanism for the long term, so this is a permissive power that lets us solve it. So, the solution will be an administrative arrangement, which we could adapt as the circumstances change.

And does the Welsh Government have any intention of asking for retrospective payments for money that's been lost over years gone by?

I don't think that would be where we would be at. I think the important thing is to make sure we have a scheme that then allows that money to be spent, and, you know, the reward, the people who have, obviously—you know, they've got the livestock, whichever jurisdiction it's slaughtered in. 

And, obviously, currently, we have an agreement at the moment that doesn't repatriate it, but gives a much greater control and much greater spend in Wales as sort of an interim, which has been in place for a year or so. So, we are getting a much greater benefit from that money already.

Yes, just on the point. It is something that's been going on for some time, but there is a lot of transit of stock into Wales as well for processing, and so that stock then—you have to have a two-way system where, I presume, the levy income that they would generate would be repatriated back to England. You only need to go up to Merthyr to look at the plant up there and you'll see lorries from Cumbria, Devon, all over the UK, you will, then. The £1 million figure is a well-established figure that the Welsh livestock industry seems to be losing, but does that £1 million figure take into account what money would have to be repatriated for English, Scottish stock that is processed in Wales? Because I presume that that money has to be taken into account as well, then, because they're not just going to say, 'Well, we'll give you your money and you can keep our money' as such.

No, that's right. The £1 million is the £1 million lost to the Welsh agriculture sector. So, the fact that England have been so loath to sort this out, certainly since I've been in post the last two and a half years, makes me think that they'll be very happy with the deal that they get too.

Thank you, Chair. Schedule 3 has been amended to include new powers to enable the continuation of the basic payment scheme beyond 2020. Can you just perhaps go into a bit more depth about how that's intended to effect the new powers?

So, the current direct payment regulations only contain ceilings, which is the method of calculating payments to farmers up to the end of the 2020 scheme year, and you're probably aware that, in the winter fair, I said that we would keep the basic payment scheme for 2020 too. So, if we didn't have a replacement for determining the amount, we wouldn't be able to continue, then, paying BPS. So, the purpose of that amendment is to provide a power to prescribe the method by which ceilings will then be determined after 2020 so that we can continue to pay BPS payments. I just think we need to be prepared for all eventualities. It's such an uncertain time at the moment for everyone, so we need to make sure that we have the potential to continue making basic payment schemes after 2020 if that's what we, obviously, choose to do.

And a supplementary legislative consent motion will be laid for this new provision, will it?

Yes, it will. So, that will be—. I mentioned in the answer to the previous question that I don't know when I'll be able to do that, but, yes, it will be.

And can the powers be relied on for the continuation of these payments until a Welsh Bill is brought forward?

Yes. So, basically, what we're doing is currently rolling over the current deal. There are two different things. Obviously, if we have a 'no deal', the—. If we didn't have—. If we have a 'no deal'—this is quite complex—the payment regulations would come into effect, obviously, on 29 March 2019, and then the common agricultural policy—. It's very clear in the withdrawal agreement that CAP is [correction: CAP payments are] out. So, it's whether we have a 'no deal' or the withdrawal deal. They're two very different things. So, we need to make sure that we have the powers to ensure that we can continue the payments, because, in the event of an agreement—as it's currently drafted, the Agriculture Bill does not include powers for direct payments to be paid in 2020. I hope I've explained that. 

09:40

Could you just clarify or confirm that, without a sunset clause, Welsh Government or any successor Government could rely on the regulation-making powers indefinitely to implement future agricultural policy in Wales? 

I didn't consider it was appropriate to include an explicit sunset provision, because of the uncertainty. I didn't think it was needed, the date. So, the powers that we're taking from the UK Agriculture Bill—. And I probably should say right from the outset that I absolutely am committed to them only being temporary and transitional powers until we have our own Welsh agricultural Bill. So, they're not time limited. So, it will give us an opportunity—. When we bring our own Welsh agricultural Bill, obviously, that will supersede the UK Agriculture Bill.   

Thanks, Chair. You've said that things are, obviously, very uncertain, so this may be a difficult one, but it would be interesting. Can you be confident that a Wales agricultural Bill will have completed its passage through the Assembly before the end of this Assembly term, i.e. before 2021? 

Yes, I've committed to doing that but, obviously, it will depend on a legislative slot and, obviously, there's a new Government coming in next week. But that's certainly always been my intention. 

Can I just add? I think there was something about 'but it might not be implemented by 2021'. I thought I read that in some briefing note or something. There was the willingness of the Government, obviously, to bring forward an agricultural Bill, but there was some question as to whether it would be enacted or implemented by 2021, because, obviously, the deadline is fixed, 2021, but the slot and all the rest of it could move. Have I just read that somewhere in a briefing? 

That doesn't ring any bells with me. I don't remember seeing anything about that. I've made it very clear that we were consulting on the transition period up to 2025 in relation to the payment schemes. But I think it's always been the intention to bring forward the Act or the Bill before 2021, but I suppose it depends where in the legislative timetable it's brought forward, as to where—. If it comes in the month before the election in 2021, it might not be implemented.  

So, it's possible, for example, that the Bill will be in draft form and the election comes, there's a change of Government, and the next Government throws it out.

That's not my intention. My intention is that the Bill will be passed before 2021. 

I think there's also a difference between when the Bill is passed and when you're implementing schemes on the basis of that Bill. We may well need to take secondary legislation to implement—. The Bill would give you the powers, but the implementation would take effect the following year, for instance, on the back of further secondary legislation. So, the UK bit—. There would be—. Within the Wales Bill, we would have to decide when, in a sense, you switch off the UK Bill powers and the Welsh Bill powers take over. That might not be the day the Welsh Bill comes into force, to give you a time to do an implementation period. So, you'd probably be implementing the Welsh Bill over the year after it came into force. 

So, the Bill could pass in this Assembly, but the next Government might choose not to implement it, theoretically. That's going somewhere we can't go now, really, but it's an appetising prospect.  

I think you've just caused concern throughout the whole of the industry. 

No, I think concern. I think that the Bill will be implemented no matter which parties are in power. There's a way to bring amendments in afterwards and a new Bill, but let's not have people in the agriculture industry thinking there'll be nothing there after 2021 because of a change of Government, if one takes place. I think that everybody wants a Bill. They want a Bill to go through, and people might want to come and—. If there is a change of Government, there might be amendments to it, but there'll have to be a Bill. 

I think, Chair, to give reassurance to the agricultural sector, I've made it very clear that, for instance, around payments, no new schemes will come in before the—. You know, we won't get rid of the old schemes before the new schemes are absolutely ready, so I think that will provide the assurance. 

That's a useful lead into what I was going to ask, Cabinet Secretary, because, given all the unknowns that we're facing and the commitment for further consultation, how confident are you that the Welsh Government and the sector will be sufficiently prepared to begin transition in 2020-21? 

So, we've done a significant amount of work with the agricultural sector. We're doing, obviously, a massive piece of work around the 'Brexit and our land' consultation. We've had 12,000 responses. We're looking into all that, and, as I just said, I think it's really important that we laid out that no new schemes will come into place before—. Sorry, the old schemes won't be finished until the new schemes are absolutely ready. So, we've made it very clear about the transition period, how long that will be. We consulted on 2020 to 2025. I gave the assurance about the basic payment schemes for another year to 2020, because I absolutely appreciate it's such an uncertain time. That was very well received at the winter fair. So, I think we will be ready, but it is a big ask, obviously. We haven't even—. Because we're looking at all the responses, the policy hasn't been decided. It's really important that we look at those responses in a very meaningful way and a very considered way.   

09:45

And the other thing I would add on that, if I may, is that we've always said this would be a gradual transition as well. So, we've now said there won't be significant change in 2020. The change in 2021 would be gradual, relatively small scale. So, the things that people would need to adapt to early are likely to be relatively few, and the change increases over the following year. So, I think, thinking of 2020-21 as a sort of cliff-edge, single change moment isn't the right way to approach it. This is the beginning of a transition period. So, there's longer for people to adapt and understand the changes and to make their decisions on how they take their businesses forward. 

And I think we've always made clear that it would be a multi-year transition period, and, again, I think the sector appreciates that too. 

I just want to ask, on transition, how concerned you are that the Bill could actually lead to transition happening at different speeds within the UK, and the impact that would have on the internal UK market, and also very practical issues for cross-border farmers, for example.

One of the things I'm very keen to do—. You mentioned cross-border. Cross-border is a complete irritation, and, as someone who represents a border constituency, I've got very few farms but there always seems to be difficulties with it, so I'm very keen to see much more simplification and less bureaucracy et cetera, and one area is the cross-border. So, I think you're right—we could see different countries, but I suppose that's called 'devolution' and we're going to have to manage that. So—

But this is a framework Bill, so should that not, in part, be addressed within the Bill?

Some of those things will be issues for frameworks, but, as the Cabinet Secretary says, the prospect of the four parts of the United Kingdom doing different things is a consequence of these being devolved choices. 

But where's the co-ordination? That's what I want to understand. Where does it all come together, to have these discussions and to have these understandings, and to have parameters in terms of, 'Well, you know, this is what we agree.'?

So, I suppose at the quadrilateral. You'll be aware that we've had quadrilateral meetings since straight after the vote. At the last quadrilateral meeting, which was held here in Cardiff last month, we were discussing taking that form, as a form of governance, further, because we absolutely accept, as four countries—obviously, Northern Ireland hasn't got a government at the moment—but as four countries, we're going to have to continue to have these conversations for the very reason you explained. So, we're going to get the ministerial quad forum on a much more formal footing. 

So, why isn't there anything about that sort of governance structure in the Bill? We always complain about these fora not delivering, and Government Ministers complain as much as anybody else very often about that. So, why should we have confidence that that's the best way forward, when we're bringing legislation forward and we could actually address some of these on the face of the Bill?

I think a lot of those things are not actually legislative issues. They're about ways of working between the four administrations, reflecting where we are with the inter-governmental agreement. So, the issues that will need to be addressed in the framework don't need to be tackled in legislation because they're not legislative issues; they're about how we work together. And it's very much the sorts of issues that you are identifying around what happens if one part of the United Kingdom wants to do something that causes major problems in other parts of the United Kingdom. You need a mechanism whereby we could challenge or be challenged, to say, 'Hang on, what we're doing is causing a problem in England' or vice versa, and a mechanism for discussing that. That doesn't need to be legislative. 

And that's exactly what we're working up in terms of the frameworks. Absolutely. 

09:50

And, in fact, I'm using the DEFRA model that we've had, because I have to say it has worked very well, I would say, over the last two and a half years, and I'm just about to set up one with the Department for Business, Energy and Industrial Strategy, but from the energy part of the portfolio. I met with Claire Perry this week in London, and had a detailed conversation with her last week on the telephone, because I think the way that we've worked with BEIS hasn't been as successful as it has with DEFRA. So, it has worked very well, but we do need to get it on a much more formal footing.

Before we move on, John Griffiths wants to come in on this point.

Just in terms of environmental protections during the transition period, Cabinet Secretary, and how confident we can be that they will be at least maintained, and possibly strengthened, and how you'll be working with stakeholders to design the implementation during that period.

A very important point. And you're quite right—I've said certainly standards won't slip; if anything, they will be strengthened. And, as you know, I meet with the NGOs regularly, and they're very, very challenging on that. They sit at the stakeholder Brexit ministerial forum, which met last Thursday up in Merthyr. I will be going out to consultation—I was going to say in December, but we're in December now, so I'm assuming next week—around environmental aspects. So, again, there'll be a consultation period on that too.

Thank you, Chair. You'll be aware of criticisms around the fact that the Government hasn't undertaken any assessments or modelling of the economic impact of ending direct payments to the sector. Can you talk us through the process from here on in, because the clock is ticking and people need to see what impact the proposed changes are going to have, presumably before you, as well, can actually sign up to providing them?

Absolutely. So, we didn't do any impact assessments or modelling ahead of the consultation, and that was why I was able to say very clearly that it was a meaningful consultation and nothing had been decided around the scheme. I mentioned before that we're now considering and analysing the 12,000 responses, and, after that, the modelling work and the impact assessments will be undertaken. So, the plan is that we will use individual farms for pilots, for instance, and I know officials are going out to farms now, talking to farmers, to work out which farmers we will use, and to ensure that we have all that information. Because, as you say, I can't sign up to anything, and I wouldn't expect anybody else to, without that taking place.

But the modelling and the piloting are two distinct pieces of work, aren't they?

So, you don't feel that the modelling—. So, it's spring, is it? It's March, April, May that the modelling will be—

Well, we've said we're going to bring forward a White Paper in the spring, so, yes.

We'll need to have done it before then. So, I have said the White Paper will be brought forward in the spring. I'm not quite sure whether it will be early spring, late spring—

No, I was just going to go on to the piloting, but if you want to add something to the modelling—

Just to say, on the modelling, just to give the committee a sense of the sorts of things that we are looking to do, some of this is that we need to have a bit more detail on how some of the propositions for how the schemes might work, to actually build the models. So, we're not quite at that stage yet. Because this isn't just about taking basic payment; it's about taking the basic but that is then replaced by the other two schemes, and you need to know those details to understand the impact.

So, we will be looking both at the whole-of-Wales level, but also wanting to work with a number of individual farm businesses, looking very closely and working with them around their farm business accounts, and so on, to think what would this mean for this farm. And we've been talking with the farming unions to identify a number of potential farms we could work with, and looking at a representative sample of different sectors, different areas of Wales, to be able to look both at the macro, whole-of-Wales level, and then what might this mean for different types of business, different scales of business, different sectors, so that we get as rich a picture as we can of those impacts, so that we can identify, 'Oh, this particular item works for these types of farms, but doesn't for this type of farm', and so that you can then think, 'Okay, then this is how we might adapt it.'

But some people are really bewildered that you hadn't done some of that before bringing the initial proposals forward, because what now if you find, having done the modelling and having tried some piloting, that actually this model doesn't deliver what you're hoping it would? If that is the case—if that transpires to be the case—then you would, I presume, look at different options or a different direction. 

09:55

So, why is it then that, in the Bill, by providing for the phasing out and the eventual termination of direct payments in Part 2, you're actually tying the Welsh Government to that course of action, because you don't know yet whether that is the right course of action?

We don't think that the CAP and the basic payments scheme is the right—

Well, I think it's been proved. I think it's been absolutely proved—we don't get the outcomes that we need to see, so I know you—

But what we equally don't know is whether what you're offering will deliver those outcomes because you haven't modelled it, you haven't piloted it and you haven't done—

We would have to look at different schemes. I know that you and I had an exchange in the Chamber about volatility and I mentioned the weather. I really think that, because we've had such a vast array of different weather this year—. Every season has brought a different type of weather to what we're used to. In the summer, as soon as we had that dry weather in the summer, in the July, at the Royal Welsh Show, the unions wanted a dry weather summit, which I was very happy to do, but I think it just shows that they haven't got—. They tell me that they want to be resilient, they want to be prosperous and they want to be stable, but that's not where they are at the moment and I think that BPS is just too blunt a tool to provide that and it doesn't reward farmers for their productivity, it doesn't reward them for their performance, so—

—and it's that you haven't proven the case that your model will actually deliver against those measures as well.

So, we need to do that ahead of the White Paper and then, as you say, if we think those two models don't, we can look at how we can do different schemes or how, within those two schemes that we've got, we can change things. We've got to be flexible. We've absolutely got to be flexible.

So, moving from flexibility to red lines and looking at the situation with the World Trade Organization, if I understand it, looking back to the previous position, you were wanting something on the face of the Bill about this. Is that right, because I'm coming into this fresh?

I just want a clear agreement. It's because we have a difference of opinion: they think it's reserved and we don't think it is.

Right. That sounds pretty typical. So, will you be publishing the agreement that you reach with the UK Government on how clause 26 on the World Trade Organization regulations will operate?

Okay. So, as I say, my concern wasn't with the clause itself, but it was about how that power was exercised, because their belief was that it was a reserved matter and I was very clear that it wasn't. So, I don't think it would be appropriate for that kind of information to be on the face of the Bill.

I know that, at official level, there's been a huge amount of work done around this, about how we managed the process. Again, I'm waiting for Michael Gove to write to me on this, because he is completely aware that this is a red line for me and I will not recommend consent of this Assembly unless we get this matter sorted out. And I have to say that he wants the inter-governmental agreement to work as much as I do. So, I am very hopeful that the two Governments will be able to reach an agreement. This is the last remaining issue, really, for me. So, I do hope that we will be able to recommend that the Assembly gives its consent to the LCM.

So, when you get that agreement, if you do, hopefully, get that agreement in a timely way, will you be able to publish that so that we can see on what basis—?

I think this will be in the same way that, in the initial exchanges on the Bill, there were exchanges of letters between the Cabinet Secretary and the Secretary of State that, I think, were tabled to the Assembly as part of the package explaining, and I think this would be in that same position—that we would have an exchange of letters setting it out that we could—

I don't think it'll be an agreement as such, I think it'll just be—. But I'd be very happy to publish letters if I'm able to.

That's useful. So, if it's that sort of an agreement and if the disagreement about what the impacts of the clause are, you know, is it reserved or is it not reserved, how would the agreement that you hopefully are going to reach with this Government—? I'm concerned about the sustainability of it really. So, that's an agreement that's made between the two Ministers—you and Michael Gove—and you're telling us that he's being co-operative, which is nice to hear, but how sustainable is that when we've got future Governments, different Ministers, you know—? If it's not in the legislation, and you've said now that you don't feel it needs to be—how is it made sustainable if it's not in the legislation is my question?

10:00

It just goes back to the very beginning of devolution, when we had the memorandum of understanding between the UK Government and all the devolved administrations. And if you think about it, that's the basis of all our inter-governmental machinery. So, it goes back to that.

So, it's in the context of that, and if there was an attempt to take a different view from the other side, with perhaps a different Minister from their side, that's how it would be resolved.

Moving on to—. We've touched on it already, but in terms of future schemes, Cabinet Secretary, you've said that the Bill doesn't constrain future policy. But we've heard from stakeholders that there are omissions in the Bill, and I'm wondering if you could address some of those concerns, which were that there are gaps in the current list of purposes for which farmers can be supported, that the needs of tenant farmers aren't adequately addressed, and there's no cross-reference with both the Environment (Wales) Act 2016 and the Well-being of Future Generations (Wales) Act 2015.

I'm not aware of any gaps, because what the Bill does is confer very wide powers in respect of financial support. So, from our point of view, any concerns that stakeholders have, we would work with them, as we work up the schemes, and, obviously, our own Wales agriculture Bill will be the time, then, to—

I think some of the gaps that were perceived were around food security, energy security, public health.

That wouldn't be in the UK Agriculture Bill. I mean, as I say, its main—. It's about financial support, but those sorts of gaps could come within our Bill.

In relation to tenant farmers, I think that is an area where I have received a lot of comments. In fact, I spoke to the Tenant Farmers Association at the winter fair, and they were very pleased with the discussions that we've been having with them. We've got a specific question in our consultation around tenant farmers. I think the important thing is that funding goes to active farmers and those who are delivering the outcomes that we do seek. So, I'm very committed to exploring how we support all farmers, and that absolutely includes tenant farmers; they're a very important part of the agricultural sector in Wales.

Around the cross-reference of environment Act and the future generations Act—well, when officials are developing any policy, they obviously look at those two pieces of legislation in the round. I don't think it would be usual to cross-reference them in that way.

Just on the public goods and the UK Bill, Labour MPs put forward amendments to include the need to put healthy, sustainable and local food production on the face of the Bill as a public good. So, I'm just wondering why you feel it isn't the right place to do that.

Well, I don't think food is a public good, because it's got a market, so—.

It is devolution, absolutely. But, no, I don't think food is a public good.

No, and you've made that point previously. I understand that, although I don't agree with it.

Moving on, then, Cabinet Secretary, there is no requirement for new schemes to be established through regulations, so they will not be scrutinised by the Assembly. And there are no requirements either to report to the Assembly on the effectiveness of the schemes. So, I wonder if you could tell the committee why you asked for provisions to be included in that way.

Because we've made no policy decisions, I thought it appropriate to take a neutral assumption and mirror England's approach on this. But, as I've said, these powers are transitional, they're temporary, and I will ensure that the Assembly has full opportunity to scrutinise the Welsh agricultural Bill when we bring that forward.

I mentioned, in an earlier answer to Llyr, that I think it's really important that we move away from all the bureaucracy and the regulations around CAP. And I think that, if you ask farmers in general why they voted 'leave', it's because of that bureaucracy. And I've said very clearly that if we don't remove that bureaucracy, we will have failed. So, we will develop the new schemes—you've just heard Tim say how we're going to look at pilots, how we're going to look at modelling, how we're going to look at impact assessments, and I think it then will be appropriate with stakeholders to bring forward a Wales agricultural Bill, co-produce it with their input. And then, again, going back to that flexibility, it's really important that we have the ability to be able to fund future schemes based on the varying environmental, social, economic needs, and we'll be able to prioritise and improve and adapt as we get more information. 

10:05

And those two answers have generated an awful lot of other questions. Helen Mary first. 

So, just to be really clear, this lack of ability potentially to scrutinise is temporary, and when you come to bring forward the Wales Bill we won't be in a situation where we won't be able to scrutinise regulations—that sort of thing. 

I just want to seek some reassurance regarding your last comment about moving away from bureaucracy, and if we don't do that we will have failed. Well, some would argue that we will succeed in terms of maintaining the bureaucracy, and I don't like the blanket use of the word, so I'll use the words that I do like—the rules and regulations that suddenly surround and give protection to the environment. I wanted to bring that out in your statement and seek clarification that you are clearly not talking about removing the rules and regulations that provide protection at the moment, and that, in some cases, are adequate but not adhered to.  

No, absolutely, I don't mean that. Again, I stated earlier that, if anything, we will be improving our environmental standards not just maintaining them. We've got very high environmental standards. I remember the first time I went out to Brussels—to an agri council I think it was—and I was talking to a counterpart who said that one of the things the UK—the UK as a whole, really, but Wales, in particular—has done is bring up the environmental standards across Europe. So, I absolutely don't mean that, and those farmers who were led to believe that that would happen—I think they're very clear now that it's not going to.  

Thank you. One more question, John. You have one more question. 

Yes. In terms of any consideration you've given to requesting a new power to amend the purposes for which financial assistance can be given, which would perhaps reflect the outcome of 'Brexit and our land'—is that something that you've given thought to? 

Yes, I think the powers that we've got in Schedule 3 are broad enough to ensure that future policy is not constrained, because, as I say, we've made no decisions ahead of the consultation. I've actually specifically requested broader powers than England have in the Bill to ensure that that's the case, because we do things differently in some areas. But, again, I will reiterate that these powers are only transitional, they're only temporary, until we bring forward our own Bill. 

I thank the Cabinet Secretary for the evidence so far. Given that you are in the process of understanding the consultation responses to 'Brexit and our land', and you've had 12,000 responses to date, and hopefully some of those responses will influence your thinking—you might well up end up having to look at other ideas for support into the agricultural/rural economy—have you considered requesting any additional powers within the Bill, so that if there are other ideas that come out of the consultation you can adapt accordingly as you go forward?  

No. We think the powers are broad enough, as I just said, that it won't constrain future policy. 

So, you're quite happy with what's in the Bill, bearing in mind, I presume, that you haven't gone halfway through that consultation yet, given that it only shut in October?   

I honestly don't know where we are, actually, on the number that have been read. I've read about 200 myself. I don't know how far into it we are. 

I couldn't give you a number, but people are processing them, and remember, of that 12,000, there are a number of, say, postcard campaigns and so on, so it's—. 

Some are more detailed than others, which I think is a very, very good way of putting it. 

So, some of those 12,000 could well be part of, as you said, that postcard campaign?

The 12,000 don't include one that would count as maybe a 100 different responses, because they're all the same. 

No, it's 12,000 individual formal responses. Some are part of a much wider, say, postcard campaign, where people have just signed on the bottom line. Some may well be representative of a number of people who have come together to produce a single response.

10:10

But it does give me an opportunity, because the National Farmers Union—they had a campaign, however their members replied individually, and they were very concerned that we were going to put them all together. So, it gives me the opportunity to say, 'Absolutely not—each one will be read individually.' And I think it was about—I'm plucking this figure—2,500. 

Yes, something like that.

So, the powers, as you understand in the Bill, are sufficient to meet any—?

A follow through. Great. The second question I'd like to put to you is: given that you take the consultation through, it talks about, obviously, having land managers as the basic recipients of any support going forward. Now, that's an increase in the base that you're going to be supporting, if that is taken though from the consultation. What impact do you think that increase in the base potentially could have on the original recipients of agricultural support, i.e. the agricultural industry?

So, the ambition is that all farmers will be able to access both schemes. I absolutely appreciate some farmers won't want to, just like not all farmers get basic payments schemes. So, we want to pay for outcomes—that's absolutely what we think the taxpayer would want to see, and I've said that scrutiny's going to be at a much higher level than it has been when the money was coming from Europe. So, I've heard lots of concerns about—you know, we'll be paying people to have an allotment, we'll be giving more money to Natural Resources Wales. That's not the case at all. It's about making sure that we get the outcomes that we need. Again, we need to make sure that we do appropriate analysis to ensure that there is a fair distribution of that funding. 

Can I just ask you—? You said scrutiny's going to be a lot more than when it came from Brussels. What do you mean by 'scrutiny'? Because, obviously, in earlier evidence you touched on the fact that we will have failed if we've created more bureaucracy around it. So, do you mean scrutiny from policy makers or—? 

No, sorry, public scrutiny. If I said to a constituent in Wrexham, 'How much public money do you think goes to farmers?' I'm sure they would not have—. Generally, people would not know that figure. They would not know that £330 million comes from Brussels, lands in my budget, and goes straight out, and there is very little scrutiny around that funding. When that money's coming from Welsh Government, you know the scrutiny that we get as a Government on our budget. There's going to be a lot more scrutiny about that funding.

Public awareness—sorry, that probably would have been a better expression. Public awareness, yes.

And the final question I'd like to put to you, please, is: given that there's going to be a need for a regulatory framework when you're taking these proposals through—there is a transition period as well—will there be a new regulatory framework in place when the transition actually starts, which I think we've determined as being 2021 or thereabouts?

I think it's probably too soon to be able to give you a date, but it is an important matter that needs to be worked up as we develop our policy.

If I can add to that—there is a regulatory framework at the moment. It is not a very simple and clear one. Some of it is set in regulation, some of it is cross-compliance requirements attached to the basic payments scheme. So, it's complicated and it's difficult for the farmer to see, but it provides a base of, 'This is the regulatory requirement that needs to be met.' Now, that can be simplified in the sense of being made much clearer, not in the sense of reducing the environmental protections, and made much easier for everybody to use. But during the transition period, the existing set of regulations and requirements would still be there. So, there's not going to be a gap until we provide that much clearer, simpler system. So, we want to work on that in parallel and bring that in as soon as we can, because it will help everybody, but the existing set of regulatory requirements and baselines will remain in place.

So, if I've understood that, the old regulatory framework will continue through the transition period, but it will diminish through that period until we get to the end when a new regulatory framework will be in place, which I suppose is logical, given that it's a transition period. And, so, instead of focusing on 2021 for having a new regulatory framework in place, really, you need to be focusing on 2025 because that—as the consultation talks and the Minister have indicated—is when the completely new scheme will take over. Would that be correct? 

10:15

You would certainly want it to be in place—. You might be able to bring it in place before then, and you would, obviously, remove the current system and replace it with the one that brings it together in a much more coherent, clear way. Now, if we can do that earlier, that would be great, because, as I say, I think it would make things much clearer and easier for everybody. But if that is delayed, the existing protections remain in place. 

I want to ask about forestry, because, at the moment, we've got a Bill in front that only talks about agriculture and doesn't mention in the short title forestry at all. We're assuming, rightly or wrongly, that the intention is it will include forestry and the provisions around data collection, market intervention, marketing standards and the WTO rules. So, if those assumptions are correct, why, then, is forestry not mentioned in the title? 

Okay. So, it's not included because—. It's not included in the current EU legislation. So, we wouldn't want to amend it to cover forestry because we don't want to change legislation that's outside the scope of replacing CAP. 

Okay. So, are we assuming that forestry is included even though it's not in the title, or are you saying 'no'?

Okay. Just to be absolutely clear. So, it doesn't fall within this scope. 

But there are different requirements that mean some of the powers would enable us to support some of the investments in forestry like we do under the current scheme, but many of those things like market interventions, marketing standards, WTO, in a sense, don't apply to forestry in the same way that they do to basic agriculture. So, there are different requirements for, in those areas, forestry and agriculture, so it's not needed, but it gives us the powers to support, for instance, tree planting. 

I think it's because of the seasonality of, obviously, agriculture and horticulture, you don't get that with forestry. Trees can stay there. 

Thank you. With regard to market intervention and the provisions around market intervention, how will—? What's the mechanism for ensuring a joined-up approach across the UK in terms of the interpretation of what is meant by 'exceptional circumstances', and how can we ensure a level playing field? 

So, the powers around making a declaration of exceptional market conditions are, obviously, very extreme and short-term circumstances and where they need very swift action to address them. And going back to what I was just saying to Joyce, it's about the seasonality of, obviously, agricultural products and horticulture, and perishability of the goods. So, that's what that power is around. It's about being able to make a very quick decision. 

I suppose it would be if we couldn't move perishable products quickly. 

Past examples have been some of the very extreme price fluctuations or extreme weather events that cause major short-term disruption, and this is a classic area where you need a framework, because we would need to be able to agree, around the UK, all four countries, 'Actually, we're all going to intervene in this', or, 'Actually, this is only something that is disrupting Wales and it's appropriate that Wales only acts.' So, it's very much that how you do it is exactly what the framework discussions are about. 

Just on that, then, would the drought that we experienced this year, for example, qualify? 

10:20

It did not qualify in European terms. It did not trigger these measures at the European level under the existing EU schemes. Whether we would choose, in a UK context, when we are no longer constrained by the EU rules, to count that, would be a choice to be made at the time. But all I would say is—

In that framework situation.

Which framework, sorry—the one that doesn't exist at the moment?

So, at the moment, we're considering what frameworks we have. So, this would be an area where I would say you would need a framework. So, as Tim says, it would be part of that UK framework.

But traditionally this has been about really very extreme circumstances.

Because we've seen words such as 'significant', 'severe'; you're now saying 'extreme'. You're saying extreme, or that's what needs to be quantified—

All I'm saying is that, when you look at the situations where under the current EU provisions in this space they have been triggered, they have been in a relatively few cases.

So would your expectation be that, in future, it will be broadly similar to the current regime, or is that just a blank page that needs to be—

At the moment, it's a blank page, and, as I say, we're considering what frameworks to have. So, we haven't got down into that detail.

And do you have a view as to whether it should be the same, or should we be a bit more flexible?

We haven't really looked, and I think you would need—and there are issues there around availability of funding that, at the moment, are unknowns as to how far you would go in where you set the bar.

I want to thank the Minister for coming along today and answering our questions. I can tell you we're under tight timescales for producing a report, but I'm sure you're used to those.

We're hoping to get our report—well, we have to get our report finished by next Wednesday. So, can I make two requests? If there's anything else you would like to add, please can you write to us, preferably by the end of tomorrow, in order for that to be taken into account for our final report? And would it be possible to have copies of the correspondence about the World Trade Organization agreements, also by the end of tomorrow?

Well, if you have them by the end of tomorrow, can we have a copy?

My expectation is I could have a letter off him next week around WTO, so I may be able to give it to you before Wednesday—if I receive it, but I'm still waiting for it.

You can't provide it for us before you receive it. So, we thank you for the openness, and the way you've talked to us and discussed these issues, and realising that, at the end of the day, we're all on the same side. So, thank you very much for coming along, and I also thank you for bringing your official.

5. Papurau i'w nodi
5. Paper(s) to note

If I ask us now to note the following papers: 5.1, correspondence from the Chair to the Llywydd; correspondence from the Chair to the Cabinet Secretary for rnergy; 5.3, correspondence from the Cabinet Secretary for Energy, Planning and Rural Affairs to the Chair; and correspondence from the Cabinet Secretary for Energy, Planning and Rural Affairs to the Chair regarding the Climate Change (Wales) Regulations 2018. Are we happy to note those? 

Cynnig o dan Reol Sefydlog 17.42 (vi) i benderfynu gwahardd y cyhoedd o eitemau 6 a 7 o gyfarfod heddiw a'r cyfarfod ar 12 Rhagfyr 2018 i drafod yr adroddiad drafft ar Fil Amaethyddiaeth y DU
Motion under Standing Order 17.42 (vi) to resolve to exclude the public from items 6 and 7 of today's meeting and for the meeting on 12 December 2018 to consider the draft report on the UK Agriculture Bill

Cynnig:

bod y pwyllgor yn penderfynu gwahardd y cyhoedd o eitemau 6 a 7 o gyfarfod heddiw a'r cyfarfod ar 12 Rhagfyr 2018 yn unol â Rheol Sefydlog 17.42(vi).

Motion:

that the committee resolves to exclude the public from items 6 and 7 of today's meeting and the meeting on 12 December 2018 in accordance with Standing Order 17.42(vi).

Cynigiwyd y cynnig.

Motion moved.

Can I now—? I've got to get this right. Can I move a motion under Standing Order 17.42 to resolve to exclude the public from items 6 and 7 of today's meeting and from the meeting on 12 December, which will consider the draft report on the UK Agricultural Bill? Thank you.

Derbyniwyd y cynnig.

Daeth rhan gyhoeddus y cyfarfod i ben am 10:23.

Motion agreed.

The public part of the meeting ended at 10:23.

Archwilio Cynulliad Cenedlaethol Cymru