6. 4. Statement by the Chair of the Climate Change, Environment and Rural Affairs Committee on the Committee's Inquiry into the Future of Agricultural and Rural Policies in Wales

– in the Senedd at 3:37 pm on 9 November 2016.

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Photo of Ann Jones Ann Jones Labour 3:37, 9 November 2016

We now move on to item 4, which is a statement by the Chair of the Climate Change, Environment and Rural Affairs Committee on the future of agriculture and rural policies in Wales. I call on the Chair of the climate change committee, Mark Reckless.

Photo of Mark Reckless Mark Reckless UKIP

Diolch. If we are to secure the best possible deal for our rural communities, agriculture and environment following our exit from the European Union, then we must be bold and clear in what we expect from the UK Government. We, the Climate Change, Environment and Rural Affairs Committee, have reached an early consensus based on expert advice and the views of our stakeholders. The committee and I agreed to make this statement in order to send a clear message to the UK Government about what Wales wants at the outset of the exit process.

We are seeking two commitments from the UK Government. The first is in relation to future funding. We believe that Wales must continue to receive the level of funding for agriculture, environment and rural development that it currently receives from the European Union. That was, after all, the promise made by a number of senior campaigners on the ‘leave’ side in the EU referendum. Whilst we recognise that the ‘leave’ campaign did not speak for the UK Government, several of its senior campaigners now do, notably the Foreign Secretary and the Secretary of State at the Department for Environment, Food and Rural Affairs.

The second commitment is in relation to policy freedom for Wales. Decisions on future agriculture, environment and rural development policies should be taken in Wales. After all, responsibility is devolved. Should the case be made for some level of UK-wide policy framework, then this should be done on the basis of agreement between the devolved administrations and the UK Government. We also support bilateral discussion between the Welsh and UK Governments. Agreement on any overarching policy framework should be subject to scrutiny by the devolved Parliaments and Assemblies and require their consent. If the UK Government does ensure a continuation of prior EU funding to Wales in full, then we call on the Welsh Government to make a commitment in return. We ask that the Welsh Government agrees to protect funding, once transferred to Wales, for the support of agriculture, environment and rural development policy.

On behalf of the committee, I have written to Andrea Leadsom MP, the Secretary of State for Environment, Food and Rural Affairs, to seek a commitment to maintaining the funding envelope for Wales. I have also written to Lesley Griffiths AM, Cabinet Secretary for Environment and Rural Affairs, who I’m delighted to see in the Siambr, to ask for an assurance that such funds would be protected and continue to be used to support agriculture, the environment and our rural communities.

Only with these undertakings from the UK and Welsh Governments can we with confidence propose future policies. It’s crucial to recognise the current EU funding for agriculture and rural development is several times higher than it would be if subject to the Barnett formula.

The continuation of prior EU funding is needed to ensure the economic and environmental sustainability of our rural areas. Without it, we risk losing the unique cultural, social and linguistic cohesion that characterises rural Wales.

The committee’s work on our post-Brexit agriculture and rural development inquiry has been about more than future financing. We’ve have held discussions with farmers, foresters and environmentalists. In September, we visited farms and food producers in Ceredigion. Last month, we held a workshop with stakeholders from across Wales, as well as convening a seminar of leading academics. Later this month we will be visiting farms in Snowdonia.

In addition to the position on future finance, our committee has reached an initial view on two further high-level principles. Both are intended to support evolutionary change, rather than a sudden shift in policy. First, we support a continuing shift in financial support, away from payments based on acreage and historical production, and towards agreed environmental and land management objectives. Second, we are particularly keen to support more marginal farms, including in upland areas. Helping poorer farmers especially should also help maintain a public and political consensus for farm support. However, development of policy principles such as these will be meaningless unless we secure the requisite future funding.

I hope that all parties in the Assembly can support our work and the call we make today on future funding. Subject to that, we can all make the best of the opportunities to deliver for the people and environment of Wales. Diolch.

Photo of Paul Davies Paul Davies Conservative 3:41, 9 November 2016

Can I commend the Climate Change, Environment and Rural Affairs Committee for deciding to look at the future of agricultural and rural policies in Wales as one of its first inquiries? Of course, agriculture is the backbone of the rural economy and makes an enormous contribution to the Welsh economy as a whole. It’s essential, therefore, that these policies are examined especially in the light of Brexit. However, whilst it’s important that the Assembly scrutinises agricultural and rural policies, I’d like to understand a little bit more about the sheer scope of this inquiry and therefore the realistic outcomes we can expect throughout this process. So, perhaps the committee Chair can tell us more about the scope of this inquiry in his response here this afternoon.

Now, I’m sure that the Chair will agree with me that different policies require greater time commitments, given that some are more heavily embedded or are even reliant on EU legislation than others. So, can he tell us if there will be any flexibility in the committee’s timetabling to add additional meetings so that all aspects of the inquiry are fully discussed?

Of course, it’s important that the committee does all that it can to encourage stakeholders and rural communities to be involved in any inquiry, and I’m pleased that a workshop and a committee visit has already taken place, as he mentioned in his statement earlier on.

I understand that the consultation on this inquiry, which has already been issued, will end on 25 November, so can the committee Chair confirm how the committee will then respond to the replies received? Understandably, given the wide-ranging nature of this inquiry, how will it deal with important separate rural policy topics that it could receive as a result of this particular inquiry? Of course, within the agricultural brief alone, there’s enough policy scrutiny work to last this committee for a long time. So, it’s important that stakeholders are fully aware of each step of the committee’s inquiry process.

Members who’ve been here for some time will remember the Rural Development Sub-committee of the third Assembly, which was a permanent sub-committee to consider matters relevant to rural development and rural policies. Can the Chair tell us what his assessment of that committee was and has the current committee had any discussions regarding the possibility of resurrecting a similar sub-committee to look at rural development and rural policies on an ongoing basis, rather than just a one-off inquiry?

I very much agree with the committee’s view that while it may be advantageous to have, by mutual consent, a UK-wide framework for agriculture and rural development, and for environmental regulations as well, the committee must ensure that principal policy responsibly in these areas are repatriated to Wales from Brussels. I’m pleased to note from today’s statement that the committee will also press Governments at all levels to make sure that agriculture, rural affairs and the environment remain financial priorities, because, clearly, these are the areas that will be most tested as we exit the EU.

Dirprwy Lywydd, I’m very pleased to see that rural affairs and agricultural policy will be further scrutinised at an Assembly committee level. We are facing a time when a number of important decisions will need to be made in relation to Welsh agriculture and there will be a profound impact on rural Wales. We on this side of the Chamber welcome the Climate Change, Environment and Rural Affairs Committee inquiry into agriculture and rural policies, post Brexit. It’s vital that we involve all stakeholders in discussing ways to make our rural communities more prosperous and resilient in the months and years ahead.

So, can I thank the Chair of the committee for his statement today? I look forward to seeing this inquiry’s progress over the coming weeks. Thank you.

Photo of Mark Reckless Mark Reckless UKIP 3:45, 9 November 2016

I’m grateful to the Member for his contribution and for his work for his party and others in these areas. As he says, agriculture is the backbone of our rural economy, but we’re conscious not to define agriculture too narrowly. Both the scope and type of agriculture has changed and continues to change, but also the scope in different areas of Wales to diversify from traditional agriculture and attract income through other provision is very significant. Also, in our request to the Cabinet Secretary for the Welsh Government to commit to protect spending in these areas, we wouldn’t want to be overly restrictive in the precise definition and boundaries around those areas, because we recognise that those change over time.

The scope of our inquiry has developed and I think it’s been one of the big challenges for the committee to determine what the proper scope of this inquiry is. I was in Scotland a week or two ago and spoke to what they call the convenor of the equivalent rural affairs committee in Scotland, and they’ve chosen, at least so far, not to undertake such an inquiry and were interested that we were doing so and in the challenges that we faced. I think also, along with other committees, we are feeling our way in terms of relations with the external affairs committee, ably chaired by David Rees here, and in our links and discussions with the Welsh Government and UK Government, to the extent that we are able to seek those.

What we’ve decide to do is for me to make this statement today, setting out the absolute centrality of the findings. Because I think, as we’ve continued, it’s become clear to us that we could spend an awful lot of time working out precise policy proposals and great ideas of what we’d like to do in the future, but actually without clearer commitment and confidence on funding, that work might be wasted. So, we’re very keen to put that very clear statement that we expect that level of funding to continue and we hope that the Assembly will be able to express that to the UK Government on a cross-party basis.

We’ve also put out there two further principles, which we discussed at a stakeholder workshop and thought that the initial response was reasonably positive, even though, of course, some farmers and some areas may get some disbenefit from those continuing trends. But, they are continuing trends that we think may help secure greater support for what we’re arguing for in terms of financing and the requirement for that money to continue.

We do have flexibility in the timetable. We’ve put out the call for evidence and responses to the consultation by 25 November. Our intention is to have evidence sessions in January, so if there are particular experts, interest groups or individuals who the Member thinks we should hear from, I’d be very interested to hear his submissions on that. I was aware of the sub-committee that met previously and have heard positive reports, particularly in terms of engaging stakeholders from its work. I don’t think I’m betraying any particular confidence by saying that the committee has had discussion around the potential use of sub-committees and rapporteurs. We haven’t, as yet, taken a decision to establish a sub-committee for this. I think our intention would be to report towards the end of the first quarter of next year, but depending on developments in the overall post-Brexit discussions, as well as within the agriculture and rural development sector, it’s an area we could very well return to, given its primacy and importance to the work of the committee.

Like the Member, I agree with the UK-wide framework. I do also just put there that the Welsh-UK discussions are also important, because there’s a different political context in Wales, where we voted for Brexit and where we have a Government that is coming to terms with that and is committed to continued membership of the UK rather than the different perspective of the Scottish Government. So, I don’t think we should make something that the Scottish Government might veto or where it might want to go a different way. I don’t think that should preclude our working with the UK Government, although obviously we want to explore the potential for a UK-wide framework to the extent that would be agreed by the Welsh Government and by this Assembly.

Photo of Mr Simon Thomas Mr Simon Thomas Plaid Cymru 3:50, 9 November 2016

(Translated)

I thank the Chair for giving a fair summary of the committee’s proceedings to date. From the Plaid Cymru point of view, it is important that we do seize the opportunities now, in terms of the decision to leave the European Union, in order to ensure that we have the best possible terms for agriculture and rural areas, but also to ensure that opportunities are taken to tailor agricultural policy and rural support to Welsh needs. In that context, the Chair referred to the fact that the committee has already looked, for example, at less favoured areas—the uplands, particularly, in Wales—and it does lead us to the fact that it won’t be possible to develop policies, and certainly we won’t be able to ensure that funding is available for those areas unless we have a specifically Welsh framework. It’s very important that’s in place.

Of course, there is room for collaboration with the other nations of the UK—we need that in terms of animal health, animal welfare and such issues. But, does the Chair agree, therefore, that the only way that we can meet the needs of the committee is to ensure that there is freedom of opinion and freedom to make decisions in terms of agricultural policy in Wales, and that we are in a position to agree with other nations on the issues that we have in common, but that we also retain the freedom to make different decisions where that is to the benefit of rural communities?

The second question that arises as a result of this statement is: how will the committee look at other issues? The focus of the Chair’s statement—and indeed it’s true to say the focus of the committee’s proceedings—has been on funding. It’s true to say that a political pledge was made and therefore it’s appropriate that we try to hold people to account in terms of those pledges, but there is another process happening here. Trade is important, exports are important—90 per cent, as the Chair will know, of our agricultural produce is exported to the European Union at present—and the opportunity to take ownership of the good reputation of Welsh agriculture is very important, I think, and there’s an opportunity at one level there. So, does the Chair believe that we could look at how environmental legislative continuity and legislative continuity in terms of trade, and their interrelationship, could also be considered by the committee? Although that is another huge area, it’s extremely important that we don’t only look at funding, but that we also look at the broader context where our farmers trade with the rest of Europe and the rest of the world.

Photo of Mark Reckless Mark Reckless UKIP 3:53, 9 November 2016

I thank the Member for his contribution, both just now and also in committee. Certainly, I’ve found his contributions very valuable, including in developing my own knowledge of the sector. I also appreciate his generally upbeat approach and focus on the opportunities that may come out of Brexit, and I think that those different positions—I’m impressed by the degree of focus on how do we adapt to the new situation and do what is best for our constituents. He mentions a desire to seek the best terms for agriculture, and specifically Welsh agriculture, both I assume in any future trade deal with the European Union in third country deals that may be struck, and indeed within the UK’s own internal market. I think he mentioned 90 per cent exports—the figure I think I remember from one of our research briefs was 60 or 70 per cent, but that may be on a UK basis rather than a Wales-specific basis. We talk in our committee and elsewhere sometimes about food miles and wouldn’t it be better if we consumed food closer to where it was produced, but in the case of much of what is produced in Wales, and particularly lamb, it simply would not be plausible for us to consume even a significant share of what is produced in Wales. The size of the agricultural sector is large for Wales, but one matter we must keep very close and central to our discussions with UK Government is it looms much less large at a UK level than it does for Wales. When we look at the exports, the proportion going to the European Union, the potential tariffs if we were subject to a common external tariff in these areas are higher and really much, much more significant, and could completely change the orientation of trade and production if that were not handled well. There may be opportunities out of that, but there are certainly also risks. I would share the desire to continue access to the single market and a desire not to have those tariffs on Welsh agriculture; I think I probably speak for all members of the committee and probably other Assembly Members in that.

Yes, we should have freedom for our agricultural policy, and I think that should be clearly recognised by Westminster. Nonetheless, I think there may be significant scope for agreement on UK policy frameworks or, if necessary, England-and-Wales frameworks, and so much of what is de jure devolved to us has, in practice, been done at the European Union level. We think of protection for particular types of agricultural goods and foods; if we’re outside the European Union, we have to really establish our own regime for that, and we have to have minimal standards for third country products under WTO rules and, perhaps, stronger standards for European products if that is agreed. But it’s going to be a very significant challenge for us in terms of legislative capacity as much as anything else. I think there will be a need for a common approach under some issues, such as animal health, where it’s difficult to see the advantages of a number of different approaches within these islands, although others may have different views on that.

In terms of environments, yes, I think there are strong arguments for legislative continuity. I think much of the European legislative framework has been adopted without close consideration at a domestic level, and I’ve often said to people from environmental organisations, I’ve slightly cautioned against always referring to European protection, because for some people who perhaps don’t share a positive view about the European Union and its laws, it may be better to make those arguments on the merits of the legislation or as international protection. I’m struck by how much of the European legislation has more international counterparts as well. But we need to look at those, I understand that, and I think there will be scope for us, committee and Members, to work to support environmental organisations and the Assembly as a whole, as we take on that very large task.

Photo of Huw Irranca-Davies Huw Irranca-Davies Labour 3:57, 9 November 2016

I very much welcome this statement, because it’s a signal of early intent on the high principles from the committee. I particularly welcome the clear statement that the funding that is currently there and that was very much promised within the referendum by those campaigning to leave should actually be delivered, but not only that, that the policy that surrounds that should actually be made in Wales and decided in Wales, as befits a legislature where all those competences are, indeed, devolved to us now. So, we shouldn’t in any way retrench into a situation where, whatever shape the Brexit finally takes, on the framework of the EU, as it is passed down to a UK level, we suddenly find that we’ve lost competences. It has to be here that agricultural policy, rural development policy, environmental policy, et cetera, et cetera, should actually be decided.

But we do need that funding, and I think the Chairman is right in making that very clear point that the funding is key to this. It must be for the Welsh Government, I have to say, to actually decide how to utilise that funding, or which way to cut, dice and splice it. Because it’s interesting that, within the statement as well, the Chairman rightly says that—he doesn't actually refer to the point that has been made to us previously, but I know he’ll have paid regard to it, where people have said, ‘This isn’t a blank sheet; this is an issue of transition.’ It’s not as if we’re setting up a whole new ball game here. We are working within rules and there are other countries that will have different versions of support for their farming community. It isn’t a blank sheet.

However, there is an opportunity for some more radical thinking, and some of that radical thinking may indeed include thinking around how you use public money to actually deliver wider public goods. Amongst those public goods, by the way, are the production of good, sustainable food and viable rural communities with small and medium-scale farms. But also amongst those public goods are flood alleviation, how we deal with the peat bogs on top of the moors, and biodiversity. How do we maintain the absolutely invaluable ecosystem services that we have and all of that as well? This does give us an opportunity to think differently and think radically, but we must—as the point has been made to us, as well—think about the fact that we are not going from a blank sheet. Whatever happens in England, or in Ireland, funnily enough, let alone in other European countries, we need to keep an eye to that in how we take forward this. But funding is key, and policy freedom in Wales is key as well.

There’s just one final point I wanted to make. We often talk about rural communities within this place—and I was used to this in Westminster as well, thinking about places on the north York moors or the East Anglian farmers, or somewhere in Ceredigion, beautiful as it is—but it’s also an issue that affects the south Wales valleys and many other places. Forty per cent of my constituency is upland hill farming—always has been. It’s essential for Wales, in particular, that we get this right, and I very much welcome the high-level statement by the chairman here. Even though we’re still in discussions—we’re still talking with many people out there—the high-level principle of saying, ‘The funding that was promised must come to Wales’ has got to be delivered on, and then it’s got to be for Wales and the Cabinet Secretary in front of us to actually decide, in concert with Assembly Members here, what the policy should be and how we should actually use that funding to deliver those wider benefits that are out there. That’s the thing I would end up in saying. Whilst this is very much focusing, quite rightly, on farming and food production and so on, it is also looking as those wider imperatives, critical that they are, of biodiversity, ecosystem services and sustainable rural communities. They all go hand in hand. They can all be delivered together. We are stewards of this, going forward, not masters of this, and we need to look after these rural communities.

Photo of Mark Reckless Mark Reckless UKIP 4:01, 9 November 2016

I’m very grateful to Huw Irranca-Davies for that contribution. You mentioned at the beginning funding being promised, and I mentioned that some ‘leave’ campaigners did give assurances—and I mentioned two of those who are now in very senior and relevant levels in the UK Government. I recognised, during the campaign, that it was a campaign and that I wasn’t speaking for any Government on the matter. I sought to be careful in what I said in light of that. I think other ‘leave’ campaigners may also have considered that. But I remember—and I see Andrew R.T. Davies here, and I think there were a number of exchanges with the First Minister in the run-up to that referendum, where he was pressed to give assurances as to the continuation of funding.

I also remember other occasions. I shall not name the Member, but a particular Member on the Government side, when I was debating in front of farmers, was suggesting to the farmers that they should vote ‘remain’ because, if they didn’t, their funding could be at risk, and they shouldn’t assume that agriculture and rural development would be at the top of the list of priorities for a Welsh Government with a lot of other pressures on its time, and perhaps not traditionally so much support in that community. But what I want to do today, with this statement, is to draw Members from all parties together behind what I think is a common objective. I think we’re in a political fight for this. I think we can achieve this. But I think if we work together—yes, to hold ‘leave’ campaigners in Government to specific assurances given, but also to explain the unique rural economy that we have in Wales—and I mentioned the linguistic element, which I think is probably not something many policy makers in London will give great consideration or even necessarily be aware of when these matters cross their desks. If we were to go from the EU level of finance to a Barnettised level of finance, the impact on those communities in terms of the likely depopulation and change to the landscape and breaking up of cultural, social and linguistic communities that that would lead to would really be very, very severe. I feel that strongly, as I know do many Members in this Chamber, whichever side of the debate they were on at the referendum.

The Member also mentioned wanting legislation made in Wales. I agree with his sentiments but he, as I, will be aware of the sheer complexity of the legislative base. I’ve heard it suggested that there are something like 5,000 legal instruments affecting the CAP. This Assembly and the Welsh Government will have many different calls on their time, as does our committee, and I think that the challenge is to find what are the essential elements, and we’re trying to identify key principles that we want to particularly apply in Wales. I think we need, as a committee and as an Assembly, to focus our time on those areas where we can really make a difference if we seek to change the legislative framework or adjust it in any way from that which has grown up within the CAP. Yes, the Welsh Government should have control of that money, but I do think that a statement as to continuing that level of support for these areas would assist us in making arguments to UK Ministers and others to keep that funding. The Member also mentioned that, I think, his constituency has 40 per cent upland hill farming. When we talk about more marginal farms, yes, that includes the uplands. But, particularly in areas such as his, but also across much of south-east Wales, there’s not necessarily a division between lowland and upland farming. There are many farms that will have part of the farm in the valley and part further up. I agree with him in terms of what he says about biodiversity and sustainability. It’s very important that we all focus on those, and there are times when there are hard trade-offs in terms of money and other objectives, but he is right to keep those areas at the forefront of our minds.

Photo of Mr Neil Hamilton Mr Neil Hamilton UKIP 4:05, 9 November 2016

I congratulate my friend Mark Reckless on the impressive way in which he chairs the committee and the way he has delivered his statement today. Also, I would like to commend the committee for the serious job of work that all members of it are doing. I’m not normally associated with the word ‘consensus’ very much, but I am delighted to hear that the committee has arrived at a broad consensus approach, and I hope that that will extend beyond the confines of the committee and into the Assembly as a whole. Agricultural policy in the context of leaving the EU is vitally important. It has been overwhelmingly dominant in EU spending ever since we joined back in 1973. It is right, therefore, that it should have paramount importance in policy development in Wales, to which the freedom is now given to develop an agricultural policy to suit our own needs, specifically for our own nation. I am pleased to hear what Simon Thomas said in his response to the statement earlier on, and the positive way in which he approaches the opportunities that now lie before us. It is, of course, vitally important that the funding of agriculture in Wales is preserved as it is handed down to us from the EU. I appreciate, as Huw Irranca-Davies said, that this isn’t something that is set in stone for all time. But, at least for a significant process of transition, stability does depend upon people knowing that what they have been used to can be relied upon. Bearing in mind that we joined the Common Market, as we then called it, before the Barnett formula was invented, the obligations for funding agriculture predate that formula. For the time being, at any rate, it is essential that what is spent on farming in Wales is protected. I’ve strongly supported the First Minister and the Welsh Government’s view that the UK Government should guarantee every penny of funding that the EU currently spends in Wales. I think the corollary of that argument is that the Welsh Government itself must now step up to the plate and guarantee, for a significant transitional period, the level of funding that will be handed down to it by the UK Government in respect of agriculture, if that is what, in effect, happens in due course.

I’m pleased at the emphasis that has been put upon the support for marginal farming, and in particular for the uplands. We have to recognise the political reality in which we all operate—that the agricultural community is a small proportion of the total population, and we depend upon the consent of urban populations for the degree of subsidy that rural areas receive. One of the ways in which we can maximise the potential of that is treating farmers as custodians of the countryside as much as the growers of food. Although I do believe that food security is an important element as well, we still have a very substantial deficit in food production in this country. We have massive imports, and that, in the context of the negotiations coming up with the EU as to our future relationship, is a weapon that we should use to the full. In our own hands, we have a £10 billion-a-year deficit with the EU on food and drink. Therefore, they have every interest in maintaining the existing access to the single market. There is also the important element, which has been mentioned so far, of future trading opportunities between Britain and the EU, and Wales and the EU in particular. Simon Thomas was right to point out the dependence of Welsh farming upon exports, and this is a challenge for the future, undoubtedly, particularly for producers of lamb. We have to recognise that the world doesn’t stand still and countries like New Zealand have faced huge challenges in the past—they abolished all their agricultural support overnight—and yet agriculture in New Zealand thrived. Maybe there are lessons that we can learn from such experiences in the committee as well—not that that’s something that I’m recommending, but, nevertheless, the response to such shocks does offer opportunities for us to learn as to how we can cope with them. Trade promotion is another important element of this as well, where we’ve got greater freedoms as well.

The last point that I will make is that it’s not only agricultural policy that is devolved to Wales, but also environmental policy, and this gives us the opportunity to look at the current regulatory regime and to see whether, in certain instances, it is disproportionate in the costs that it imposes upon farmers relative to the public benefits that are supposed to derive from it in other areas. Given the remoteness of Brussels and the opacity of the way in which decisions are made there, and the importance of lobbying groups in the making of public policy, and the unaccountability of the people who take the important decisions, I think this gives us a huge opportunity in Wales now to reconstruct—over a substantial period of time, no doubt, because the job is huge, as my friend has pointed out—in that it gives us the opportunity to have a look at agriculture in the round, both the costs regime as well as the trading regime. Because, ultimately, all of this affects the viability of farmers and the life in the countryside of many others who depend for their livelihoods upon them.

So, I congratulate my friend, as the chairman of the committee, once again, and the Members who serve under him, and I look forward to further reports in future.

Photo of Mark Reckless Mark Reckless UKIP 4:11, 9 November 2016

I thank my group leader and party’s agricultural spokesperson for his contribution. He rightly observes that the common agricultural policy has been dominant in EU spending since, and indeed before, we joined in 1973. He’ll also be aware that that proportion of spending has come down over that time from near 90 per cent to around a half in more recent times. We talk about wanting to maintain every penny of funding, and we make this call that we are today to the UK Government in that respect. But I think we also do need to understand that there are some complexities around these issues. The overall trend in spending, or certainly the push of UK policy in CAP negotiations, has been towards a reduction and continuing fall in the share of the EU budget on this area, and, if we’d stayed within the European Union, it’s possible that a UK Government might have continued that pitch. There’s also the issue of are we talking about maintaining spending in sterling or in euro terms. Many farmers will be shortly receiving, perhaps, a significant increase in payments, at least in sterling terms, although they’ll of course be worried about the sustainability and likely future for those payments. We also have to consider what the definition is of the area of agriculture of the CAP or a broader rural development and land management policy.

I think there is also scope for improvements and opportunities in taking powers in this area within Wales. Certainly, farmers I speak to have a lot of concerns about the degree of regulation and would question whether all the activities they are required to do actually make economic sense or sense in terms of their objectives. I know the Cabinet Secretary has had similar conversations with farmers, and, at least in the near term, doesn’t hold out huge prospects for a great deregulatory bonfire. I think, from those who criticise the degree of regulation, what we really need are specific examples of regulations that should be repealed, or things that could be done in a better or more proportionate way, and I think we’d be grateful for input from the Member and others on that.

He mentions trading opportunities—yes, there are trading opportunities. The example of New Zealand is a very stark one, and, yes, I think, in a sense, agriculture in New Zealand is successful currently, but it’s a very different type of agriculture than what there was before 1984, and, on those who were in involved in the mid 1980s in production, I think many farmers suffered very severely from those changes, and moving from one system to another will not be easy and would, I think, mean a severe loss of employment and potentially associated depopulation in our rural areas.

Overall, though, I’m very grateful to the Member and others for the contributions we’ve had, and I think that we will all work together in pushing these arguments and doing the best we can for Wales in this sector, as in others.

Photo of Ann Jones Ann Jones Labour 4:15, 9 November 2016

Thank you. I have two more Members who wish to speak on this statement, so can I ask for a concise question, and a concise answer from the Chair, and we’ll get both of you in. Jenny Rathbone.

Photo of Jenny Rathbone Jenny Rathbone Labour

I just wanted to respond to Paul Davies, really, to say that this is not just a rural affairs matter. My constituents in an urban constituency are just as concerned about the quality and the cost of food as any other residents are, so I think that it’s really important that we address this issue in a timely fashion, because farmers who voted to leave didn’t realise that they were potentially going to lose 80 per cent of their income. I think one of the issues that we do need to be considering in this evolution, not revolution, approach that we’re taking is that Brexit is going to make a lot of vegetables more expensive, because nearly half the vegetables we consume are imported. And we’ve already heard evidence—

Photo of Ann Jones Ann Jones Labour 4:16, 9 November 2016

Are you coming to a question, please?

Photo of Jenny Rathbone Jenny Rathbone Labour

My question, really, is: how are we going to turn that corner, given that, at the moment, we only grow vegetables on 617 hectares of land, which is 0.4 per cent of agricultural land, hardly any of which is in receipt of pillar 1 payments. Many of the people who are involved in the labour-intensive activity around horticulture are people whose future in the country is unclear, because they’re European migrants. So, what does the Chair of the committee think we are going to be able to do to address the food security issues that are posed here, as well as the health of the nation and the future employment of people in Wales?

Photo of Mark Reckless Mark Reckless UKIP 4:17, 9 November 2016

I thank the Member for her contribution. She ably represents her urban constituents, and brings that perspective to the committee deliberations. In terms of horticulture, it’s not an area that has traditionally been within the CAP, although the free trade framework within the EU sees us have very substantial imports, particularly, I believe, from Denmark and, especially, the Netherlands. Yes, if it were harder for labour to come into the country to work in those areas, there would be pressure to increase wages to try and bring others in, and I recognise the challenges about that. The impact of the pound is also likely to be a factor. I think probably what Welsh producers will want to do is to focus particularly on value-added and higher-end products—the organic products or ones where they can have a supply chain that benefits from and markets the concept of having vegetables locally produced, since I know many of the Member’s constituents, as will our own, will share her view, and would welcome being able to purchase more, if not all of their produce from local quality providers.

Photo of Vikki Howells Vikki Howells Labour

Diolch, Ddirprwy Lywydd. Two questions and I’ll try to be concise, Chair. I’d like to thank you for the statement you’ve made today, as one of the members of the committee myself, and I welcome the comments regarding looking at the broader context of farming and the role of the rural economy, particularly with regard to the Welsh language as well. So, firstly, my question is: how can we integrate this broader approach into our inquiry, so that we take a truly multifaceted approach, which extends beyond purely looking at the financial implications of agriculture as a narrow concept? Secondly, after meeting lots of farmers, including young farmers within my constituency, there are definitely concerns around the skills agenda. As the proportion of people working in agriculture in Wales is over three times that of the rest of the UK, how can we ensure that the skills agenda to make sure that the next generation of farmers wants to go into the industry and stay there—how can we ensure that that actually underpins our inquiry and is placed at the heart of future policy?

Photo of Mark Reckless Mark Reckless UKIP 4:19, 9 November 2016

I think for the broader context, we will have an opportunity to take a more cross-cutting approach to agriculture in rural development, because of the policy freedoms we would have post Brexit. I do, again, emphasise, though, that it is going to be quite time-consuming and demanding for members of our committee, but also potentially for the Assembly as a whole, in developing the legal framework and pressing our priorities, which we identify in these areas. We will, I think, come with our report, perhaps in March next year, although we as a committee are keeping open what the potential follow-up will be and whether that’s an interim report or whether we begin a new inquiry. I know we are looking at the food industry more generally, because a number of us want to integrate that approach into what we do with agriculture and rural development.

The Member ably raises the skills agenda. I think one barrier to people coming into the sector is, of course, the price of land, and the potential decoupling of support or what arrangements there might be post Brexit that could have implications for that. I have been quite struck, particularly on our visit to west Wales, that for many families farming is in their blood and they feel an obligation to continue farming that land. So, even if they’re economically on the edge, they may continue doing that, even to the extent of taking on loans and perhaps, down the road, risking losing that land because they feel that is what they do and that’s their obligation to their forebears, to their family and to that landscape. And I think, with our focus on the more marginal areas, I’d like to use what funding we do have with a view to supporting those people and helping to sustain those communities, and I look forward to our committee continuing to work towards those objectives.