Minister of State’s speech to the 2012 Oxford Farming Conference

Minister of State’s speech to the 2012 Oxford Farming Conference.

This was published under the 2010 to 2015 Conservative and Liberal Democrat coalition government

The Rt Hon James Paice

I want to start by quoting another American: Benjamin Franklin.

“There seem to be but three ways for a nation to acquire wealth. The first is by war, as the Romans did, in plundering their conquered neighbours. This is robbery. The second by commerce, which is generally cheating. The third by agriculture, the only honest way, wherein man receives a real increase of the seed thrown into the ground, in a kind of continual miracle.”

Well, time may have moved on and there are other ways of creating wealth but behind that quote is the belief that farming and the production of food should be respected. For generations that was true in the UK but after the grain mountains and milk lakes of the 70s and 80s it ceased to be. We were accused of living off subsidies, destroying the countryside and exploiting our livestock. We even had Ministers in the previous Government going so far as to say we do not need farmers as we can import all our food.

That was an abdication of responsibility. It ignores the fact that farming has proved Malthus wrong. In the 1950’s there were just three billion people on this earth. Now just 60 years later there are seven billion yet most are better fed than ever before. Yes, one billion people do go to bed hungry and I will come on to our responsibility to them. The fact is that through technology we are feeding more people than ever before. In the UK alone our farms are feeding over ten million more people and producing 60% of their food overall compared with 50% in the 50s and we should be proud of that.

Almost a year ago we had the Foresight report. The bottom line is that we have to produce more, waste less, distribute it more efficiently and do so with much less energy and use of resources whilst protecting our biodiversity. Oh! And also with less water.

So is this a time for despair? Or as a small island can we simply ignore the challenge and buy our needs abroad? Both of these I believe are wrong as I want to explain.

Let me start with the belief that we can import our needs. One of the little mentioned aspects of the expected population growth is that of the 2.5 billion extra people in the next 40 years one billion will be in Sub-Saharan Africa - a doubling of the population of that continent at a time when climate change is expected to reduce its production capacity considerably, even without the political and economic instability which is rife in a number of African countries. So if we increasingly rely on imports to feed our people we will be competing even more with some of the poorest countries in the world in an increasingly pressurised market.

That would not be leadership but self indulgence.

Some people still equate food security with self sufficiency; those days are long past. Our supermarkets are full of food from overseas, much of which we cannot produce here. The food market is now global.

It means we have to play to our strengths and do those things which we can do best.

It means seeking out new markets for those products where we are most competitive and it means constantly striving for better systems of production. Not just the large farming businesses but all farmers. There may be increasing demand for food but it does not mean we can sit back and believe the market will provide an income. It will be even more competitive but in my view that is an opportunity and a challenge which I believe we can meet.

First we need a CAP which encourages efficiency and not stifle it.

That means we need to work with likeminded countries which understand that challenge and set out on a journey to wean the industry away from direct support, not now, not even in the next seven year period but a journey with a destination.

It means we need to invest a greater proportion of CAP funds in measures to aid innovation and investment as well as the welcome proposals for research funding.

We also need to ensure that greening of the CAP is genuine with added value for the taxpayer and the environment. We would prefer it to be done through pillar two but if it has to be in pillar one as well then we will work to ensure that it is as uncomplicated as possible whilst producing real benefits.

Both Caroline Spelman and I are committed to maximum engagement and to demonstrate real leadership in the EU Agricultural Council. It is that engagement which has just gained us three years relief from electronic tagging of the historic flock.

For the first time for decades the UK is developing our own proposals and alternatives. Rather than just saying what we do not like we will be making our own positive proposals in the EU.

We must not forget that the CAP we are negotiating is for the whole EU, not just the UK. We need a policy which helps those very small farms, often with very poor productivity, just as much as it is for the very large farm businesses whether they are here in Britain or the former collectives in the Eastern countries of Europe.

Let’s not pretend that the challenge does exist here too. We have some of the most efficient and productive farms in Europe. Our wheat and milk data shows our unit costs of production are amongst the lowest in Europe. UK cereal margins per hectare are among the highest in Europe. But we all know that there are many farmers for whom this is a pipe dream. So we need the best research, technology and knowledge transfer that we can get. We don’t have to do it all here; that is why our increasing alliances with other countries to share our knowledge are essential.

Many of you will have heard of the Taylor report, commissioned by Lord Taylor when we were in Opposition. Well now we have that very man in DEFRA to make it happen. Of course we would like to spend more on research and development but to have maintained research expenditure as much as we have in the current circumstances is recognition of our commitment. But that research and technology is only any good if it gets into the field.

We have a real opportunity for a step change here.

I believe that farming advice is best delivered locally with those who know best how to get the message across: industry-related bodies and other key stakeholders who work with farmers on the ground day in day out.

The new Farming Advice Service for 2012/13 which is available now and is up and running offers joined up advice on competitiveness, nutrient management, climate change adaptation and mitigation, and cross-compliance in one place.

I have for a long time believed that as farming moves nearer the true market and out of the shelter of government it needs its own professional body. I don’t mean the role played by the NFU but in technical and business expertise; in my view the Agricultural and Horticultural Development Board is well placed to become that body. I have asked the Chairman John Godfrey to see how it can be achieved and how we can take it forward to the industry.

Part of that development need is for innovation. I have visited many farms in recent years with fantastic examples of innovation. But we need to encourage more and spread best practice so we will be holding an innovation summit in London in March followed by regional events with a practical focus. The aim will be to raise awareness of the resources, particularly the Technology Strategy Board, available to food and farming businesses to help them innovate.

We’re also launching a competition aimed at SMEs, for innovative ideas. This is not some new political gimmick; some of our farmers have been innovating for centuries - Jethro Tull and Coke of Norfolk to name but two. It is the constant innovation and development which keeps us at the forefront.

Here in Defra we are innovating too. Earlier this autumn I announced the Animal Health and Welfare Board for England. This is about stock-keepers taking real control of our disease and welfare policies. I want the Board to challenge Defra and Animal Health staff; I want them to scrutinise budgets as they are doing and I want them to promote better systems of control of endemic disease. The pig sector has done well but cattle, especially beef and sheep are way behind.

We are also announcing Rural and Farming Network groups, which will have real access to Ministers. These were promised in our manifesto and we have delivered them.

I said earlier that we needed to find new markets. At home we have changed the rules on food labelling, we have introduced Government buying standards and we know there is a real increased appetite for British food.

But there is a whole world out there! Last year our food and drink exports grew by nearly 11 percent to almost £16 billion. I get challenged by farmers who see little relevance in this. I point out that most farm produce goes through a lot of processing before somebody eats it.

That our food processing sector is our biggest manufacturing industry. That it employs 1.5 million people and that most processors will use British ingredients if they can get them. That is why food exports matter.

That is why in the recent Autumn Statement we announced our own Export Forum which I chair with Paul Grimwood of Nestle. It is drawing up our Agri-food and Drink Exports Action Plan. It will ensure the right information and support is available to help companies succeed overseas, simplifying the process for food specific export paperwork, and strategically promoting the best of British food.

Our recent success has been achieved partly because of favourable exchange rates as a quarter of our exports are to the EU. We cannot assume they will last so we constantly need to strive to do better. We have a strong international reputation for food safety, quality, and innovation to capitalise on.

All of this global trade is important for food security. It helps manage volatility, keeps prices competitive, diversifies supply, and incentivising productivity.**

When we talk of export opportunities most people now think of China, India, Russia, Brasil; the BRIC countries. Few people think of Belgium, yet we export more to Belgium than all the BRIC countries put together, and that demonstrates to me that we need to be with other countries who are making much greater inroads into the BRICs. We need to catch up.

It is not just food though. Britain has always been a world leader in agricultural technology and expertise; perhaps we have let others catch up but we have some great successes.

We need to capitalise on our knowledge to help others. Exports of skills, technology and genetics are all opportunities.

There will be some here who say all this talk of growth is all very well but at what cost?

Or as some farmers put it more colloquially: Do you want us to produce food or birds?

Not only do I not believe there needs to be a choice but there cannot be.

That is why we have brought together under the heading of our Green Food Project bodies representing farmers, consumers, wildlife, food manufacturers and others to work through these perceived conflicts and help us develop policies not just for the next year or two but to take us to 2050. It is creating the future framework for farming and food.

Sustainable intensification, using less and producing more; all simple slogans but which we need to turn them into real policy.

So Mr Chairman this is our challenge and our opportunity.

We can treat farming as a quaint old industry which has done Britain well in the past but which has no place in the new global food market. We can keep the cosy image of Buttercup in the field producing a few litres a day and the bucolic farmer leaning on his gate. We can sentimentalise farmers as small players in a market dominated by supermarkets at home and multinational conglomerates abroad. Or, we can set this industry on fire and take the opportunities, and face the reality that those opportunities provide.

Build on our strengths and our achievements.

Make this an industry which delivers the wealth that Franklin spoke of; proud to still be producing most of the food for our people and ready to play our part in the Foresight challenge to feed the world.

This is not about big or small, family or corporate.

It is about attitude: whether to pine for the old days of government intervention and protection or to face the challenges which are there.

We in Government cannot make it happen but we can create the opportunities for you. We believe in you - will you believe in us?

Published 4 January 2012