It’s a pleasure to be here to speak to you today. I’m sorry that I can’t stay longer but I am travelling to attend the Beef Expo event in Newark to have further discussions on many of the issues that you will be touching on today.
I have been in post as the Food and Agriculture Minister for just over a year. So this is a good time to take stock of progress. I know that this is also a critical time for many of the issues which are of particular concern to those of you in the processing industry.
The economic problems we inherited and the global economy has made it a challenging year. But we have still moved forward quickly on a number of priorities for Defra which I’ll come back to.
These are tough times for all of us but no more than in the food and farming sectors. The industry is resilient and has adapted to thrive and survive. But I know that it is not always easy.
Livestock prices over the last year have shown significant change for you and inevitably for producers
Economic pressures are not the only challenge. The recent dry weather is affecting everyone in one way or another. Estimates are a loss of at least 10% of the wheat crop. The lack of forage, alongside high feed prices, has added to the problems created by the harsh winter for livestock farmers.
It’s important in such times that we know what action we can take together - not wait until we’ve reached crisis point. The Defra Ministerial team held a meeting with farming organisations, water companies, and environmental organisations to make sure all that can be done is being done and we’re continuing to watch things closely.
Looking forward I believe the Government has a clear agenda. For the first time we have put support for British farming and sustainable food production at the forefront of what we are doing. Defra’s business plan has enhancing competitiveness of the food chain as its top priority. This is a significant step; putting food and farming at the heart of what Government is trying to achieve.
We have spent the past year taking a number of steps to deliver on that commitment.
Animal Health and Welfare Board for England
Firstly it is important that we have a structure in place to set a clear overall direction for the livestock industry. The industry has long demanded a voice in decisions which affect it. In April I announced the creation of the Animal Health and Welfare Board for England. The board will be independently chaired and the majority of its board’s membership will be of independent individuals from industry; this will put decisions in the hands of those doing the work on the ground. The Board will be responsible for setting strategic policy priorities for animal health and welfare. It will have a role in assessing threats from animal disease. Members will help determine surveillance and research priorities.
Importantly, this has not been set-up as a QUANGO or ‘non-departmental public body’. The Board will be part of the internal structure of Defra. It is a radical and completely new way of working. We plan to have the Board in place by the end of 2011.
Welfare at slaughter
There is however one area that I wish to mention - welfare at slaughter. We will be consulting about the new regulations but I do want to make one thing clear: there must be the very highest standards in all abattoirs all of the time. We have so far concluded that we should not use in court evidence of ill treatment obtained by covert means but that does not mean we can shrug off the issue.
Farming Regulation Task Force
With a clear decision making structure in place we then need to ensure that the whole industry can operate in an effective environment without an excessive burden of regulation. That is why a number of months ago I asked Richard Macdonald, the former director general of the NFU, to head up a Task Force to look at regulation in the farming and food sector.
I asked Richard to look at how we could develop a greater degree of trust and collaboration when developing and delivering policy and a recognition of where most people are trying to do the right thing.
The Task Force reported last week. I am very impressed at how far they’ve gone in analysing and making strong recommendations in a number of areas that should reduce the burden of red tape on food producers - including livestock movement and identification, for cross compliance and nitrate vulnerable zones, as well as inspections. They have seized the challenge I set them and have produced a really ambitious and innovative report.
The outcome of Richard’s report is clear: Defra needs to change how it thinks about regulation - how we apply it; how we enforce it. We need to trust you more; avoid process for the sake of process and focus on results. There is no place for a ‘tick-box’ attitude producing reams of paperwork.
The Report gives us over 200 ways to cut red tape for farmers and food producers. I can’t promise that we will implement all of them but we have already begun taking action. By reducing the paperwork required under Nitrate Regulations and moving away from paper based reporting for pig and cattle movement online.
What I can’t promise is that the current Government will tear up swathes of regulation - that never works because most regulation has a sensible purpose. What we need to look at instead is the way that regulation has been implemented - the red tape and the form filling.
Meat Hygiene Charging
The Task Force report contains a section on one issue which I know concerns you - meat inspection. Jeff Rooker will be speaking after lunch to update you on the FSA Board’s discussion yesterday. He will be talking to Health and Rural Affairs Ministers in all four parts of the UK now that the Board has reached its conclusions on charges. There will also be a process involving a Cabinet Committee made up of Ministers who are concerned about regulation more generally.
Contrary to some comments I do not think the issue is primarily about full cost recovery, but about what those costs are.
The watchwords for me are cost effectiveness and transparency. Tim Smith also made it clear yesterday that the FSA will consider the recommendations made by Richard Macdonald’s task Force.
The Macdonald Task Force did not look at charging per se, but it did look at the controls and at inspection and audit systems. I commend the work that FSA is doing here and within the EU to move to more risk-based and proportionate controls. I expect the Agency to consider Richard’s recommendation that where a plant has ‘earned recognition’ with a track record of good compliance, it should be able to choose to use an accredited private sector provider for meat inspections. The Agency would retain its Competent Authority audit and verification function.
That is why I mentioned earlier the issue of welfare. If we are to trust plant operators then first we have to be certain that the practices we have seen film of are stamped out. They make it harder for us to argue for more trust.
Honesty in food labelling is a priority for this Government. Clear, useful, information allowing consumers choice of standards and of origin. Because British bacon for example should mean just that.
Last year organisations from the food chain helped us develop a set of industry principles to improve Country of Origin Labelling for meat and dairy products.
Organisations from across the food chain - including the BMPA - have now signed-up to the principles. But this work does not stop there.
We are monitoring progress. Today we are publishing our first evaluation of what the picture currently looks like with labelling. It shows that many parts of the industry are already labelling food with its origin in some form, but that there is great potential for improvement. We’ll use this benchmark to measure progress in the future.
It’s not only the retail sector who should be involved - the service sector also needs to play its part. I know the service sector is diverse, with its own challenges, and that’s why we’ll be working with them to make sure consumers get the right information. But I am pleased that some representatives of the sector have signed up to the principles.
Trade / Mercusor
I know the negotiations on the trade deal with Mercosur (Brazil, Argentina, Paraguay and Uruguay) are of concern to many of you. It is the most significant of the Trade Agreements the EU is currently negotiating - if concluded it would create the world’s largest trading bloc.
There’s a balance we need to achieve to take full advantage here. The EU’s preliminary impact assessments suggest that there will be an overall net benefit to the UK from concluding a deal. But also a fall in production in parts of the UK agricultural sector.
We will be working with the Commission about how best to frame an offer to Mercosur, while providing the best possible trade and investment opportunities for our domestic industry. **
I started by referring to the last year’s trade and I would like to end by giving you some further thoughts on trade. Last year was a record year for our food exports - nearly £11bn and you know how lamb prices particularly have been driven by exports. Equally pig prices have been depressed by imports. This volatility is a feature of world markets but it should also remind us of the importance of our domestic industry. We need to think of stability at home and to maintain production.
That brings me to this week’s publication of the draft Bill for a supermarket code adjudicator. His or her role will be to enforce that code - at the heart of which is fair terms of trade. Retailers argue that the post isn’t necessary. My response is, fine, he or she won’t have much to do. If we are to maintain a domestic supply base, which was at the heart of the Competition Commission’s proposals - they must be treated fairly.