UNCORRECTED TRANSCRIPT OF ORAL EVIDENCE
To be published as HC 1654-ii

House of COMMONS

Oral EVIDENCE

TAKEN BEFORE the

Environment, Food and Rural Affairs Committee

Greening the Common Agricultural policy

wednesday 23 November 2011

Professor Tim Benton

Paul Egginton, Geoff Radley and Arik Dondi

Gareth Morgan, Jenna Hegarty, Paul Wilkinson and Chris Gerrard

Evidence heard in Public Questions 37 - 117

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Oral Evidence

Taken before the Environment, Food and Rural Affairs Committee

on Wednesday 23 November 2011

Members present:

Miss Anne McIntosh (Chair)

Tom Blenkinsop

Thomas Docherty

George Eustice

Mrs Mary Glindon

Neil Parish

________________

Examination of Witness

Witness: Professor Tim Benton, University of Leeds, Global Food Security Champion, gave evidence.

Q37 Chair: Good afternoon and welcome. Professor Benton, thank you very much indeed for being with us today and contributing to our inquiry. Just for the record, would you like to introduce yourself and give your position?

Professor Benton: I am Professor Tim Benton from the University of Leeds, and I am a researcher in agrienvironment interaction, particularly at the landscape scale.

Chair: Just before we start the formal session I have a little bit of housekeeping for those of us with an interest to declare. I want to draw attention to the Register of Members’ Interests and the fact I may be in receipt of CAP moneys.

Neil Parish: I am a farmer; I do not directly receive single farm payment but I do own land.

Q38 Chair: We are most grateful to you for participating in our report on greening the Common Agricultural Policy. Could I ask at the outset: in your view, Professor Benton, do you think the Commission has the balance right in terms of greening the CAP and delivering food security?

Professor Benton: I think the issue, as is often the case, will be that the devil is in the detail. So clearly, according to Foresight: The Future of Food and Farming and Reaping the benefits: science and the sustainable intensification of global agriculture and so on, we need to pay attention to the global need to increase production, and certainly, as you head towards the second half of this century, the world food market is going to be very different from how it is now. So we have to maintain our agricultural land bank, and there will be situations even in the next decade where we are going to need to increase production quite strongly in response to the climate.

At the same time there is a growing, important recognition that everything has to be done in a more sustainable way than has been in the past; particularly with respect to things like soils, soil management and ecosystem surfaces in general, we cannot carry on utilising natural resources in the way we have done. Therein lies the nub: how do we increase food production whilst at the same time decreasing the rate at which we have been impacting on the environment, or even mitigate against that and make it better? Clearly, with the CAP, we need to have both. Depending on the details, it could be fairly good for both or it could be fairly bad for both, and it is difficult to say at the moment. As a first pass, I am not that alarmed by the proposals compared with some of my colleagues.

Q39 Chair: The Commission has aimed to design a policy that can be implemented uniformly across the 27 member states. In your view, do the proposals give sufficient scope for tailoring the policy to local conditions?

Professor Benton: I must admit that I am not an expert on CAP, so I have not read all of the details of the proposals. From what I understand the biggest worry is that there is not enough local tailoring, and, from my perspective as an agriecological researcher, we absolutely need to make sure there is tailoring that is appropriate to the right situation, whether that is the right landscape, region or country. So I would be quite happy with the idea of having a uniform framework if the implementation regulations allowed sufficient tailoring.

What I would be worried about, other than at a very broad level, is just a one-size-fits-all policy. Within the Commission, they recognise that there has to be some local tailoring, but it is the extent to which that comes out in the implementation regulations that will be the key thing.

Q40 Chair: Is the difficulty not that they are trying to have a one-size-fits-all policy, and there will be differences between member states and there will be differences within member states? Is there sufficient flexibility in the policy at present?

Professor Benton: I do not think so. The scientific consensus is very strong at the moment that what we need to do is tailor things to the specific landscape. So even in the UK, how you would manage a Cornish landscape is very different from how you would manage a Norfolk landscape, and what you would have to do-whether it is 7%, 5% or 3%- and how you would connect up those elements would be quite different in those two sorts of landscapes. So, absolutely, we need to push very hard for that.

Q41 Mrs Glindon: The Commission has opted for a land-sharing rather than a land-sparing approach. Do you think the land-sharing approach presented offers the most environmental benefit for the resources invested?

Professor Benton: Again, I think the answer has to be: potentially or potentially not. Land sparing versus land sharing in a sense is a semantic argument about the scale at which you are looking at things. So in a typical farm you have a field, which is the land used for agriculture, and then you have the margin, which is the spared land. At a landscaped scale you will have some areas that are not farmed at all and you will have some areas that are farmed extensively. At a European scale-effectively, Western Europe-the Low Countries would be seen as intensive area and the east of Europe would be seen as the spared land. So land sparing versus land sharing very much depends on what scale you are looking at.

The scientific consensus at the moment is that we need to have a network of connected habitats that is appropriate for biodiversity to get around the landscape and that has enough different habitats in it to allow everyone to find a home. So the requirements for a pollinator, such as a bee, would be very different from the requirements for a bird, and there will be some nonagricultural specialists who require nonagricultural land like copses or proper nature reserves. What we need to do is have a connected landscape that has a mixture of hedgerows, a mixture of different sorts of margins, a mixture of cropped areas and non-cropped areas, plus some nature reserves. Now, whether you call that land sparing or land sharing, what I do not think we need or can afford, in food security terms, is to think in terms of an extensive farming system, such as organic, where you are trying to encourage the nature within the field centres as well. Yields would drop too far and the environmental cost that we would transport outside Europe would be far too big.

Q42 Neil Parish: That brings me on quite neatly to my question about food security. You have said, and I agree with you, that the EU must play its part in producing food for its own citizens and people elsewhere. Are the Commission’s proposals consistent with your recommendations?

Professor Benton: We have to balance sustainability and food security. One answer to that is that we have to maintain our agricultural land bank; so as long as we are not taking land out of production and concreting it over, there is some mitigation of long-term future needs. The Commission’s own figures suggest there will be a drop in production of a couple of per cent, and various other reports have been looking at that. Again, the devil is in the detail, because if you count our existing agrienvironment scheme margins as part of that 7%, we might not need to take any further land out of production.

The other thing is that one would hope the innovation partnerships under Pillar 2 will drive innovation-there is a lot of money going into them-which will allow an increase in production that will more than compensate for any land that is taken out. Potentially it could be good. If it becomes a one size fits all, taking land out of production in a rather blunt way, and the innovation partnerships become a way of putting money into the rural environment without innovating properly in farmland, then it could be bad for food security. At the same time it could be bad for the environment too.

Q43 Neil Parish: They reckon that the 7 billionth person has just been born in the world, and the Commission is coming forward with a proposal with a 7% set-aside of arable land when there are quite a few hungry people in the world. Some of the figures I have here show that this would equate across the whole of Europe to 31 million tonnes less in wheat production, which is more than double Britain’s annual wheat production. Do you think that is sensible at this particular moment in time?

Professor Benton: From a long-term food security perspective, I think it is probably not as bad as those headline figures would indicate. There is a general acknowledgement that a lot of the problems to do with food security are not to do with production, but with the fact that we buy food and throw 30% of it away and so on. Those are well-rehearsed arguments. The figures that you quote also assume there is no further increase in productivity in the land left behind. We have underinvested in agricultural innovation for a long time and I think there are many ways we can increase yields, partly through soil management and some of the old simple things we have forgotten about, that might well more than compensate for that.

Q44 Neil Parish: I agree with you on that particular point. I want land for conservation, but is there any real moral reason for setting aside 7% of the very best arable land that can produce your 4 or 5 tonnes a week? You could have 7% or more of a country in some environmental scheme, but what worries me is the prescriptive part: you are taking some of the best East Anglian land and setting it aside when people are hungry.

Professor Benton: Yes, but then it comes down to the devil in the detail again. We should be ensuring that the 7%, 5% or 4%-whatever it ends up being-includes areas that are currently noncropped. So, on your average English farm, already about 4% is noncropped land. A lot of farmers would be able to find bits and pieces of land that are not necessarily profitable. Also a lot of conventional farmers leave more aside because it is not profitable to fiddle around with the tractor in that particular corner. I do not think it is as stark as, "We are taking 7% of the East Anglian fens out of production."

Q45 Neil Parish: That’s provided that the Commission is flexible enough.

Professor Benton: Yes, absolutely-it has to be provided the Commission is flexible. I was talking to Ewen Cameron over lunch, and he was saying he does not want to be penalised because he has been a good HLS farmer and has Farm Woodland Schemes, so has taken that land out of production already. He does not want to be in a situation where that does not count towards his 7%. That would be a daft situation; we have invested a lot of money in getting these agrienvironment schemes, and if they no longer count as the allowable area then that becomes really counterproductive. We have to fight against that.

Q46 Neil Parish: My next question is similar in some ways. Is there a risk the requirement to retain permanent pasture will hamper the EU’s ability to respond to future changes in food availability or even to prices of food? Is it right for the CAP to perhaps depress food production and then for the public to pay more for their food, having paid for the CAP in the first place?

Professor Benton: I think permanent pasture is the thing I feel most uncomfortable about. Again, it depends how you define it. If you define it as grassland that has been grassland for five years, maintaining that is only an instrument for maintaining cattle farming. If it were permanent pasture that had been permanent for decades and had a certain amount of high conservation value, then I would have a lot more sympathy with it. It makes a lot more sense, especially for many reasons nutritional and environmental, that the direction of travel over the next decades has to be to less meat production and less dairy production just for our own diets. We want to have the flexibility to change that mix of livestock to arable.

Q47 Neil Parish: There is also an argument from a conservation point of view that, if you are going to be so prescriptive as to keep the percentages of permanent pasture, then some farmers may actually plough up in advance of these new rules. So it could well be counterproductive.

Professor Benton: It is exactly the same with the HLS and the Woodland Farm Scheme and so on. If that is not part of what you will get paid for, you will chop it down or plough it up.

Q48 George Eustice: I was quite interested in the difference between the greening of Pillar 1 and what we have traditionally done, which is agrienvironment schemes through Pillar 2. Comparing these current proposals on the table with what we have done previously, do you think it offers better value for money in terms of the cost to farmers or is it likely to be a more costly and bureaucratic way of delivering those environmental objectives?

Professor Benton: There are two answers to that, neither of which may directly answer your question. For a very long time-and in my evidence I used a quote from Don Curry’s report-we have asked for broad and shallow environmental schemes that cut across the landscape to ensure there is this proper, connected landscape. In a sense, what this is doing is making being part of entry-level schemes compulsory. So, on the one hand, depending on how the regulations work out, if everybody has to do it, it should not necessarily have the same cost to a farmer as if they have to go into HLS, etc, where I am told the paperwork and discussions can be quite painful, long-winded and bureaucratic.

Q49 Chair: Sorry to interrupt, but that would still put up the cost to the consumer. It might be neutral to farmers, but it would be a cost to the consumer.

Professor Benton: Again, that is balanced by how much yield growth is going to happen, so I do not think we should get caught up in the fact that agriculture is staying the same. Agriculture has to be one of the fastest moving industries on the planet to cope with all the challenges against it. That is what I mean. If we are going to invest €4.2 billion in agricultural innovation, according to the paperwork, then we should expect quite large changes in yield. For example, I have recently done a study that showed that, in relatively similar fields at relatively similar locations using winter wheat, yields varied from five or six tonnes to 15 tonnes per hectare. If we could get half of the bottom half up to the top half, that issue in particular is gone. That evaluation must be a lot to do with management.

Q50 George Eustice: At the beginning you talked about tailoring policy even within a country. Britain’s long-term aim is that Pillar 1 would effectively disappear and everything would be done through Pillar 2, so that national Governments could tailor the policy in a way that works for them. Do you think there is a danger that by greening Pillar 1 you break the momentum towards such long-term reform of the CAP? You allow those countries that want direct payments to say, "We have done a bit of greening here now, so it’s okay-we can stick with this."

Professor Benton: I have a degree of sympathy with that, although I am not qualified to answer that question. My colleagues sat behind me might disagree. Looking at the evidence from an outsider’s perspective, the amount of money we have invested in agrienvironment schemes has not provided the sorts of benefits to biodiversity we would like. There would be an argument that the direction of travel might get us there in the end, but it might get us there so far "in the end" that it becomes too late.

I can see the political argument why direct payments to farmers in the long term are not a good idea, but it is going to take 20 to 30 years, at the rate CAP reform goes, to make a big change in that. We have to ensure there is sufficient greening, because otherwise it will be too late. If we do have to come close to doubling food supply by 2050, that is a huge ask, but, if you think about it, it is four or five cycles of CAP reform, so we have to push when we can.

Q51 George Eustice: My next question relates to the food security side of this. Obviously, there has been a lot of emphasis in the recent past on sustainable intensification and this idea that we needed to help farmers produce more using less land. However, the Commission’s greening proposals tend to be much more narrowly focused, specifically around biodiversity. Do you think that is a fair comment? Do you think this element of it is too narrow?

Professor Benton: I would like to see soils more firmly flagged, for example- soils and water use and so on. My understanding is that they will come in the cross-compliance side of things. Biodiversity is really important, and we have not utilised the value of biodiversity enough for production growth. No disrespect, but a lot of farmers are unaware that there are a large number of very small wasps that do most of the natural pest control for them, and they only see the pests when the population growth breaks out, so they only spray sometimes. If you get rid of all the small wasps, you have to spray more. That kind of hidden value of the environment is under-recognised.

Q52 Neil Parish: We should be breeding wasps then, should we?

Professor Benton: Effectively, you do that by maintaining grassy margins, because that is where they like living. It is about how you build the value of the natural environment into the farmer’s way of valuing what they are doing.

Q53 Mrs Glindon: Professor, you have said that being organic does not necessarily imply this farming practice is the most sustainable one. Do you mean that organic farming should not automatically qualify for the greening payments?

Professor Benton: My personal view is that probably it should not. Organic farming clearly has a role, and in some places it particularly has a role, but there are many more ways of being a production farmer with a higher environmental benefit than just being organic. The problem with organic is that it comes at a cost to yields, and when you do a lot of farm visits some of the best-managed farms are high-production farms with very high biodiversity, good soil quality and so on. Those do not necessarily go hand in hand with being organic.

Organic tends to be good for biodiversity but it is not always good. I think I put in the evidence that, in our recent study, farmers, because they have so little yield, want to farm a bigger area. So they actually have smaller ecological focus areas, in the new terminology, than your conventional farm; they have narrower margins and so on. So I would like to see not just organics get this automatic extra leg-up but also other well-regulated environmental schemes such as LEAF. Hope Farm, the RSPB farm, is an excellent example of that. It is a high-production farm with lots of environmental benefits, but it is not organic.

Q54 Chair: Does organic farming fit in with what you said earlier about better use of habitats and landscape, and the fact that, by definition, you are using less fertiliser and less pesticide?

Professor Benton: Our study showed that for winter cereals, which are largely used for feed, it took twice as much land to grow the same yield. So twice as much land to grow that yield is an environmental cost that is normally not taken into account. Our figures are that it has on average 12% more biodiversity, better soils and so on, but it took twice as much land. Actually, you get more biodiversity if you farm intensively and then take some of that extra land and manage it properly for wildlife.

So organic is good in terms of fewer inputs but at the extra cost of reducing yields. There was a recent calculation that, if Europe goes 20% organic, we would need an extra land area the size of Portugal on top of the area we already import from. Where is that land going to come from? It is going to come from the tropics somewhere. So what we are doing is getting a local environmental benefit, exporting the environmental cost and amplifying it to the tropics. Therefore, when you look at it in the round, it is not necessarily as sustainable.

Q55 Neil Parish: Probably Brazilian rain forest.

Professor Benton: Absolutely.

Q56 Neil Parish: That leads quite nicely into my question, because you are talking about the management of the green areas. What practical mechanisms should be included in the CAP framework to help farmers co-ordinate their ecological focus areas to create green corridors and make the very most of the conservation land?

Professor Benton: There are ways that I can imagine, and I am doing some research in this direction, to get some algorithmic prescriptions for your local environment using remote sensing. Inevitably, if you are trying to do the best for the farmer and the best for the environment, that is going to take staff time. I was recently in Australia and was shown an example where effectively they had a conservation officer going on to a farm, looking around and saying, "Given the value of the landscape and the value of what you could do, I would like you to do this." Then they enter a closed bidding process and the farmer ends up saying, "I could do that if you give me this amount of money." They make a decision about whether that amount of money is right. So it is possible to design schemes where you get points appropriate to an algorithmic expert view of the landscape. It is not impossible but clearly that is going to take staff resources. It then comes down to what we want as a society: do we want high production and high conservation value? If we want high production and high conservation, then we have to invest in making it happen; because otherwise, we will just get one or the other.

Q57 Neil Parish: You talked earlier about the grassland round the outside helping to encourage wasps; there is also an argument that perhaps these areas should include crops that are particularly good for bees, and bee populations are under great pressure. Wouldn’t there be an argument to include something like that in some of these greening areas as well?

Professor Benton: Yes, absolutely. There is a well-established understanding that heterogeneity, a range of different habitats, is a good thing in the farmed environment. We would need grassy margins, flower-rich margins, hedgerows and coppices for woodland birds. We would need nature reserves appropriate to the place-in some places that would be a grassland nature reserve and in other places it might be heather moorland or another wood. You need to have a mix, and that is why it becomes difficult to do it without some expert knowledge tailoring the system. If you try that one-size-fits-all approach, you will be trying to tell farmers to put in an olive grove or something-because that is what you will need in the south of Europe-in the north of Europe.

Q58 Neil Parish: You never know-with global warming we might be able to. Your evidence notes that it remains unclear as to whether 7% EFA is the optimal proportion. This issue is going to be central to the negotiations. Do you want to put a figure on it?

Professor Benton: No, it is impossible. The Natural Environment Research Council is investing £10 million in this area because it is a live research area. We do not know the answer and we will not know the answer for three or four years. I do not know how the Commission ended up getting that 7% figure, but I would say it is not evidence-based in the way we would like to see.

Q59 Neil Parish: It may be something to do with French agricultural policy, but that is another issue. Can I throw a googly? You talk about making agriculture more productive but the one thing Europe will not look at is biotechnology. What is your view on that?

Professor Benton: My personal view is that we get too hung up thinking that biotechnology is the only route to innovation, which it is not. My personal view is that it is a brick in the wall, and in certain places and in certain traits it might be a good thing, but it is only going to be 5%, 10% or 15% of the solution; it is not the be all and end all. By managing soils better, by using some of the basics of what we already know, we can probably get a greater yield growth than we will with GM, at least in the short term. What we understand now from post-genomic cellular biology means that the old initial ideas of taking one gene from an organism and putting it in another will be gone in 10 years, because we will find other ways of doing it that do not raise the public hackles in the same way. So I think it is a bit of a non-question.

Q60 Chair: You are an author of the Warsaw Consensus Statement on Europe. This called on Europe to "break away from an inward-looking focus" and to "play its part in producing food for its citizens and people elsewhere". Generally selfsufficiency levels have gone down in both Britain and the EU. To what do you attribute that?

Professor Benton: Probably, as a first guess, it is that we consume more.

Q61 Chair: In what sense do we consume more?

Professor Benton: In general; human consumption has just gone up so much. We know production has gone down and the balance of what we produce has changed, so we have quite a big import. The thing that worries me, and the reason for putting that statement in, is if you look into the long term, in the latter half of this century there will be large areas of the tropics where the maximum temperatures will be greater every year than we have ever known on record. In those sorts of circumstances, physiologically, crops will not be able to flower or set seed, and that is going to change the global market so much.

Europe is already one of the three or four key areas for calorie production. There was a recent paper in Nature by Foley et al that showed that very nicely. There might be a time where we have the potential to underpin global calorie production. We cannot produce all the food for the world, but we are able to produce a lot of food relatively easily. I am an ecologist so I am very fond of the idea that in the last 10 years environmentalism has become central to the agenda, but in the long run we have to maintain some potential for production growth.

Q62 Chair: There is a slight contradiction in what the Warsaw Statement says, because if we are less self-sufficient it is very difficult to feed the world; that was my point.

Professor Benton: In the global sense, if we are producing a lot, we can buy stuff in because there is a global market. So it is not just about self-sufficiency; it is about absolute levels of production in the global market. So there is an import/export balance there.

Q63 Chair: You referred to the tropics a couple of times. Can you give us examples of best practice in nonEU countries of successfully promoting sustainable intensification?

Professor Benton: As the number one I would cite the Malawi experiment in recent years. One of the things I often hear is that organic farming is a good thing and the tropics and developing world should be organic. However, very often soils are so poor that, by the time they have grown their crop, fed the leaves to the animals, used the stems for fibre or fuel and eaten the fruit, there is nothing left to invest in the soils. Providing a small amount of fertiliser allows them to have the biomass to invest in the soils. I cannot remember the exact figures, but in Malawi maize yields have gone up about threefold in the last decade.

Q64 Chair: Just out of interest, are you studying, or are you aware of anybody studying, the impact of climate change on soil conditions?

Professor Benton: There are some people, but not very many. It is a huge risk to us in the UK and Europe that we do not have the rotations; we do not have any research as far as I know-and I am quite well connected these days-looking at how crop quality will change with different rotations. We know that if you put green manure or cow muck on, it will have different impacts on the soil, but we do not know what impact putting a succession of different crops on plus different manuring strategies will have on the soil. So there is long-term research on climate change, but I think soils are a very worrying area that we are not investing in.

Chair: Thank you very much indeed for being with us today, and for being so generous with your time and contributing to our inquiry.

Examination of Witnesses

Witnesses: Paul Egginton, Director Systems, Knowledge and Information, Natural England, Geoff Radley, Land Management Head of Profession, Natural England, and Arik Dondi, Deputy Director Environmental Land Management, Defra, gave evidence.

Q65 Chair: Good afternoon and welcome. Just for the record, would you like to introduce yourselves and give your positions?

Geoff Radley: I am Geoffrey Radley; I am the Head of Profession for Land Management within Natural England.

Paul Egginton: Good afternoon. I am Paul Egginton, Director for Systems, Knowledge and Information at Natural England.

Arik Dondi: I am Arik Dondi. I am Deputy Director for Environmental Land Management at Defra.

Q66 Chair: We were trying to think if you were Finnish at all.

Arik Dondi: No.

Q67 Chair: You are all extremely welcome. We would like to thank you very much for agreeing to participate in our inquiry. My understanding is that the take-up for stewardship schemes is less than originally hoped. Is that the case and to what would you attribute that fact?

Geoff Radley: The take-up is actually pretty much on target at the moment. We are at about 70% of the utilisable agricultural area, subject to an ELS agreement. HLS is well on target as well. So no, I do not think we are disappointed by the uptake.

Q68 Chair: Do you have any evidence to demonstrate that Entry Level Stewardship results in tangible benefits for biodiversity or the sustainable use of resources?

Geoff Radley: You are asking particularly about Entry Level Stewardship. We have quite a lot of evidence on the Higher Level Stewardship side, but I will confine myself to the Entry Level side. It comes from a number of sources. The first source is the fact that we have a very large percentage of some features in agreement. Some 41% of English hedges are managed-that is, maintaining them in management, which of itself is probably a good thing. We have 116,000 km of grass buffer strips, so there should be plenty of wasp habitat in pastoral areas.

The second line of evidence is from a very useful trial that was set up at the time the ELS was introduced, or shortly before, at a place called Hillesden in Buckinghamshire. That looked at a comparison between managing to basic cross-compliance standards and managing to ELS at a farm scale with replicated plots. That has shown clear benefits for seed production in the bird plots, so producing more food for farmland birds, more flowers and a general increase in the abundance of invertebrates, including many beneficial species and including pollinating species, which is another important service the natural environment provides to agriculture.

In terms of monitoring, one of the main studies is still in progress. In the early days we ran a contract that established a baseline for a whole series of sample agreements, which were visited and surveyed. Those are in the process of being revisited now, and we do not yet have the results of those. There have been a number of other studies that have shown positive benefits. Probably the most interesting is one the Oxford University Wildlife Conservation Research Unit did showing that six-metre grass margins deployed at a landscape scale, which is something we have already heard about today, resulted in higher abundance and diversity of moths, particularly when in combination with hedgerow trees. More moths means more bats, I am afraid.

Q69 Chair: We have heard about the birds, the bees, the moths and the bats. What evidence is there of any beneficial effects of the ELS on farmland birds such as the skylark and yellow hammer? I think you have been challenged in that regard.

Geoff Radley: Yes, it is true to say there has been no reversal in the overall national decline of farmland birds. They declined very sharply before the schemes were introduced; the decline slowed or even halted during the years we had setaside; and they have now started to decline again despite agrienvironment schemes. We have commissioned a whole series of studies to try to find out why. Some of the more detailed analysis shows that there have been benefits for particular species in particular areas. We are increasingly confident that the problem is not that we are putting the wrong management in place but that there is not enough of it so far and it is not widely enough distributed to turn the national population around in the face of some of the other pressures these birds face.

Q70 Chair: Do you have any evidence to demonstrate-for example, for the hedges-that these would have been maintained or would not have been maintained without ELS payments?

Geoff Radley: That is always very difficult to assess because, with a scheme covering 70% of the countryside, it is very difficult to find the counterfactual, which is an area where people are not in agreement. The short answer is no, I do not have any firm evidence, but, if you think about it, hedges are not an economic part of many farms, particularly in arable areas these days, so their maintenance is a cost and it is essentially to provide a public good. So without some form of payment it is quite likely that more hedges would have been neglected or managed unsympathetically. What we do know is that since the scheme was introduced there has been a very widespread shift from annual cutting to two-yearly cutting, and that is largely as a result of the ELS.

Q71 Chair: Which of the current particular activities, under Entry Level Stewardship, offer the most benefit and why?

Geoff Radley: Your last witness said that variety is important on a farm, and the results of the Hillesden trial bear that out. All of them are based on research and development or practical experience that suggests they have a value, so they all have some value. The wider the mixture, the better the result. Some of the ones that probably crammed the most benefit into the smallest area are those that require the most active management-things like the pollen and nectar mix, the wild bird seed mix and so forth. Diversity is important as well. For example, the pollen and nectar provide the food for the insects in summer, but the tall grass margins can be important in terms of overwintering areas for the same insects, so the mixture is really important.

Q72 Chair: Finally from me, do you foresee any particular difficulties for tenant farmers in participating in the next round of CAP reforms and the agrienvironment measures?

Geoff Radley: Sorry, I wonder if you could be a little bit more specific about what aspects?

Q73 Chair: Well, we have heard quite a bit from the NFU and CLA as to how they look at environmental benefits, and I just wondered whether it is particularly difficult for tenants to participate.

Geoff Radley: One of the things that sometimes causes difficulty for tenant farmers on certain types of tenancy is the requirement for a minimum of five years’ agreement. That is written into the current regulations and it is likely to be in the future regulations. From an environmental point of view, a degree of continuity, the ability to have multiannual agreements, is quite an important property of Pillar 2. So there would be an environmental cost to having very short-term agreements, but clearly there is a trade-off there.

Q74 Mrs Glindon: How demanding are the activities required in environmental stewardship schemes in England compared with other member states?

Geoff Radley: I think we invented the schemes back in the mid-1980s. The first trial was in the Norfolk Broads with a state-funded scheme, and that was followed by the Environmentally Sensitive Areas Scheme. So we like to think we are at the cutting edge. I am not sure we are quite as far ahead of other countries, or going too much further than some other countries, at least. Quite a few countries now have multi-tier schemes, so they offer a broad-brush ELS equivalent and a more targeted, higher rate scheme.

Having said that, the European Court of Auditors recently did a study of agrienvironment across Europe that was very critical of the value for money from most schemes across Europe. Our schemes came out of that rather better than most. I have to say that we did not escape criticism altogether, and I would have been worried if we had, but we did come out well. They were particularly impressed by some of the features of our Higher Level Stewardship scheme: the use of indicators of success, the way it is targeted and the way it has specific objectives.

Paul Egginton: The European Court of Auditors used environmental stewardship as the benchmark for that audit, which was an interesting reference point for them and us.

Q75 Chair: It would help the Committee if you could tell us which member states you have in mind when you say "other countries".

Geoff Radley: Other countries with good practice? Can I just consult my notes, if you don’t mind?

Paul Egginton: I could start the list if it helps. The Czech Republic, regions within Germany and regions within Italy have the equivalent to tiered schemes, and Austrian schemes also have really good market penetration. So there is good practice elsewhere in the Community.

Geoff Radley: You should add Sweden to that list too.

Q76 Mrs Glindon: Do you think that greening measures can be seen as equivalent to Entry Level Stewardship in terms of the environmental benefits delivered?

Geoff Radley: Echoing something the last witness said: it depends on the detail. In our written evidence, we have given an assessment of the effectiveness of each of the individual measures. Of the three, the one that has the potential to be a near equivalent is the ecological focus area. I do not think the permanent grassland or the crop diversification is going to do very much.

With the ecological focus area, we know there was a lot of work done on setaside at the time and whether or not that had a benefit; it did. It was not very efficient per hectare, but, because there was a lot of it, it produced quite a lot of benefit in total. So greening has the potential to provide some of those benefits, depending on the level. As has already been said, it is not necessarily a good mechanism for combining the maximum amount of conservation with the maximum amount of production.

Q77 Neil Parish: So if the Commission’s so-called greening proposals go ahead-and I think we have some reservations over how green the greening proposals are-how might you redesign Entry Level Stewardship schemes to take account of the measures farmers would already be doing under the mandatory greening proposals?

Geoff Radley: I might refer you on to my colleague from Defra in a minute to give you some of the ideas that are floating around in Government on that at the moment. What I can say is that we do have some previous operational delivery experience, in that in the days when we did have setaside, which overlapped with the introduction of Entry Level Stewardship, we did offer a series of options for adding value to the setaside land. So we had wild bird seed mix and pollen and nectar mix. So it would be a Pillar 1 requirement to take that out of production and Pillar 2 pay the extra cost of doing the positive management, so that would be one way. I do not know whether my colleague wants to add anything.

Arik Dondi: We are at an early stage of policy development, and we will have a lot more detail coming up on what the regulations say on all of this. Obviously the thinking is that any kind of greening may require us to adjust agrienvironment schemes to accommodate that. One of the ways that seems reasonably obvious is the way Geoff described, which is that you look at what measures are effectively now in Pillar 1 and then adjust your Pillar 2 schemes to not contain those. Then you can do all sorts of things: you can put different measures into your Pillar 2 schemes or you can lower the points threshold you need for your Pillar 2 schemes. So there are any number of ways in which you can adjust agrienvironment schemes and I do not think we are currently settled on any of them yet, but it is under active consideration.

Q78 Chair: I just want to press you on that before I pass back to Mr Parish. Mr Dondi, do you mean an early stage of EU regulation from the Commission or an early stage of Defra thinking on how they will be implemented here?

Arik Dondi: The negotiations about all of the legal texts that are the basis of the way we run agrienvironment schemes are in early stages.

Q79 Neil Parish: Can I press you slightly on that? One of the great benefits we have in the UK is hedgerows. Now, you can drive from Calais to Berlin and you will hardly find a hedgerow for the whole of that distance-I have done it. The Commission seems to be dedicated to having this one type of policy. I would argue that in many ways we are much advanced in some of the environmental schemes because of our hedgerows and margins. Are you confident that under the Commission’s proposals we can be as green as we are now around those margins?

Arik Dondi: Again, we do not know enough about the detail of what the greening proposals mean, but we have been clear that we do not think the proposals are ambitious enough. We have to find ways of raising the ambition in Europe and continuing the delivery of ambitious agrienvironment schemes in this country.

Q80 Neil Parish: In a way that leads me into the next question, because it is all part of the same thing. At the moment the farmers are signed up to the ELS schemes and the HLS schemes and they are delivering environmental benefits. If the Commission’s greening proposals change that significantly and then you change the agrienvironment schemes, how difficult is it for farmers to make a decision as to whether they will be able to get out of the present environmental schemes and what penalties will be imposed? This is always the problem when you throw everything up in the air like at the moment. Does anybody want to face that one?

Paul Egginton: I think we would all like to have a go. I will start with today, and I do appreciate the Commission proposals are barely more than a month old, but they have been known to be coming for some time. If we look at the number of applications Natural England is processing for ELS in particular, as that is your focus, to date we do not see any downward trend in the interest of applicants in renewing expiring ELS agreements-and a number are coming to the end of their first five-year life-and we are also doing additional business with first-time entrants to ELS. As Geoff has said, on profile we are doing the business and creating the volumes of new or renewed agreements very much in line with expectations. So at this point we do not see that this is proving to be a disincentive to engaging with us, and we are providing information on the scheme in much the same way as well.

The harder end of the question, I suppose, is whether a farmer can break an agreement if they do not like the returns. Without replaying Arik’s explanation, the regulations, particularly the implementing and transitional regulations, are not yet clear. Some agreement holders may face the prospect of returning moneys they have received if they elect to break their agreement before it has run to its term. So there is a hard consideration there, as well as some softer considerations around adapting agreements, and we can change agreements during their life if the blend of options does not suit the agreement holder.

Arik Dondi: There is currently some uncertainty about what can and cannot happen around agreements that need to be changed to address the greening, because the concept of doing greening measures in Pillar 1 is a relatively new reality and we do not quite know the legal status of the way in which that would be done. It is clear that, alongside having to comply with whatever legislation we end up with, we want to maintain the benefits from the long-term agreements that are currently in place or will be put in place over the next years of the existing programme. Some of the principles-we would want to govern the way in which we negotiate on the legislation; but also, the way we develop policy and design delivery would be around making sure people who are currently in agreement do not lose out. They would still be paid for any measures they would take over and above the Pillar 1 requirement.

Chair: The meeting is now adjourned in view of the vote. We will be back at 16.15.

Sitting suspended for a Division in the House.

On resuming-

Q81 Chair: Thank you for your patience, and I apologise for the interruption. In view of the loss of time, I wonder if you had finished your answer, Mr Dondi, because we would like to stick to our timings.

Arik Dondi: The point is there is uncertainty about how some of the changes are going to be implemented, but there are some important issues regarding how we want to deal with that uncertainty. The principles in negotiating and developing policy would be around making sure that people who enter into agrienvironment schemes now do not get penalised for having done that. We just want to make sure people continue to get paid for things they do over and above the Pillar 1 requirements.

Another quite important principle is that we would not want to do it in a way that would force people to take land out of production in addition to whatever requirements we end up with in Pillar 1.

Q82 George Eustice: I know you said you are still getting high levels of interest in the schemes, but the reality is that nobody expected green taping to survive the CAP negotiations because most member states are against it. Given that the negotiations are probably going to limp on for another year, is there a danger that people will take fright when it becomes apparent that perhaps this is going to go through? Do you need to give that reassurance to farmers before the slow process of CAP negotiations is complete?

Arik Dondi: Yes we do, and we will make sure we are providing these messages very proactively.

Q83 George Eustice: I want to move on to the idea of the administrative cost of the two schemes. Could you tell us how the administrative cost of the Entry Level Stewardship scheme that you run now compares with the cost of administering a single farm payment?

Paul Egginton: I will give you the figures in percentage and cash terms. The administrative cost of delivering Entry Level Stewardship is 3% of the moneys disbursed through scheme payments. If you add in the additional IT component of that, given the high level of automation and the ability to apply online for an ELS agreement, that would add just under 4% to the cost of delivery. In cash terms, if we are looking this year at the cost to Natural England of delivering an Entry Level Stewardship agreement, that is £112 of administrative cost. If I add in the IT component the total is £284. It is not an absolute direct comparison, but the cost of delivering a single payment scheme in 2008-09 was approximately £1,700 per claim.

Q84 Chair: Did you say for a single farm payment?

Paul Egginton: Sorry-to process a single payment scheme claim, the average cost was around £1,700. That compares broadly with a cost of just under £300 for an Entry Level scheme claim.

Q85 George Eustice: In percentage terms is there a difference because the single farm payment tends to be higher?

Paul Egginton: I do not know the gross costs for the Rural Payments Agency, I am afraid, so I could not give you it in percentage terms.

Q86 George Eustice: What do you do at the moment to monitor that farmers are complying with their requirements under the ELS?

Paul Egginton: In terms of compliance with scheme rules, there is a structured process of compliance inspections. Those inspections are performed by the inspectorate at the Rural Payments Agency. Natural England plays a role in the selection of those agreement holders who are subject to an inspection. A minimum of 5% of our agreement holders need to be inspected in any one year; they are selected on the basis of a blend of risk-based methodologies and a random sample. In practice we go slightly over 5%.

Q87 George Eustice: If we were to go for the greening of Pillar 1 and some of those proposals, would additional mapping be required and would there be additional inspection costs on farms?

Paul Egginton: It depends on the fine detail. At a high level, my expectation is there is no additional significant mapping requirement through greening.

Geoff Radley: I am not sure that that is a safe assumption until we know the details. It depends on the level of information we have and the rules on eligibility.

Q88 George Eustice: One of proposals going around is that you have to grow at least three different crops, and 7% or 5%, or whatever it is, has to be pasture. At the moment you would just have arable grassland, so it is much more complex.

Geoff Radley: You really need to ask the Rural Payments Agency that sort of question, I am afraid, unless Arik can help on that.

Arik Dondi: It is possibly slightly too early to give that level of detail, but what we can say is that we do not think the greening proposals are in line with the principle of simplification of delivery that we would seek.

Q89 Neil Parish: The proposed ecological focus areas are likely to deliver better environmental outcomes if they are organised into coherent networks rather than fragmented. How successful have attempts to get farmers to co-ordinate their agrienvironment schemes been so far?

Geoff Radley: We have a number of examples of where co-operation has been possible. We also have a lot of very good experience of where there has been co-ordinated action-where a local project has been set up, with support from farmers, and encouraged farmers to do the same thing, without all of them necessarily forming a grand committee to do it. One of the more successful examples there would be the South West Farmland Birds Initiative, which has encouraged very good take-up of Higher Level Stewardship options for farmland birds across a wide area, so that does work.

Q90 Neil Parish: Going back to the entry level schemes and their prescriptions, the Commission is still coming forward with this idea of maintaining permanent pasture. Do you think that is going to stop people going into ELS schemes in case they are tied in for ever? Do you think that is going to be counterproductive to greening in many respects? If you are going to have farming looking also towards producing good food for the future, certainly with grain production, the two do not fit together, do they?

Geoff Radley: I am not sure that it will have a very large effect on farmers’ participation in our grassland options, because they tend to be the options for the higher value grassland, where they are less likely to get ploughed anyway. As the previous witness said, there is some concern about unintended perverse effects, because the Commission’s proposal does not distinguish between the really valuable "permanent, permanent" grassland, if you like, and long rotation grass lays. Where there might be some concern is with people coming out of arable reversion agreements, for example, where we have paid them quite a lot of money to put down grassland. They may choose to come out of that and free up their farming enterprise; that is a concern. There is no evidence yet that that is happening, but it is a concern.

Q91 Chair: I just want to ask about crop rotation and crop diversification. The RSPB have said in their evidence to us that crop rotation, in their view, would deliver more environmental benefits than crop diversification. Do you agree?

Geoff Radley: The whole thing is very curious, because the Commission have said they want to do crop rotation and they have come up with a measure that is crop diversification, which is odd.

Q92 Chair: So should we come up with a view on this? Would you like to guide us?

Geoff Radley: There are strong arguments for saying crop rotation is good agricultural practice, so to some extent farmers largely do it anyway for that very reason. It has soil benefits and other benefits as well. There is some evidence that crop diversification also has benefits in the farmed environment, but a lot depends on the scale of the patches and so forth. The problem with the Commission’s proposal is that it is a very blunt instrument for something that is really quite a complex problem.

Q93 Chair: Lastly, you suggest that precision farming could be encouraged under the greening measures. How would you expand on that suggestion to encourage farmers within the scope of the Commission proposals to use precision farming techniques?

Geoff Radley: There are a number of developments in farming-minimum tillage is another one-that have potential win-wins. They are particularly good for the pollution and resource efficiency side of environmental management, and they are also good in terms of increasing production or saving costs. The problem with incorporating them into a greening network is this question of the balance between universality and flexibility; it is very hard to come up with practices that are applicable from Sweden through to Greece. There are lots of things that make sense in one area; there are a slightly smaller number that it makes sense to do across one member state; and there is a very small number that it makes sense to do across the whole of the EU.

Q94 George Eustice: I just wanted to pick up on that point but in a more general sense. What impact do you think there will be on policy innovation by shifting the emphasis of greening measures into Pillar 1, where it is universal, rather than in Pillar 2, where there is scope for national Governments to pursue different ideas? You mentioned earlier that Austria is doing good practice and Sweden is doing some good things, as are some regions of Germany. Clearly, Defra can learn from that and then try to reapply those lessons here; whereas if the Commission just comes up with some central plan, doesn’t it kill off a lot of the policy innovation that you need?

Geoff Radley: The evidence suggests, as the previous witness mentioned, it is where you have locally specific and locally tailored solutions that there is the best evidence of success. Subject to what Defra might think, my view would be that the best Pillar 1 could do is to provide a degree of uniformity and an element of a level playing field across Europe, but I think Pillar 2 would have to build on that if we were going to get really good results. I do not think it will produce really good results on its own.

Chair: May I thank you on behalf of the Committee for contributing to the inquiry, being so generous with your time and putting up with the pause for the vote? We are very grateful to you indeed. Thank you very much.

Examination of Witnesses

Witnesses: Gareth Morgan, Director of Agricultural Policy, The Royal Society for the Protection of Birds, Jenna Hegarty, Agricultural Policy Officer, RSPB, Paul Wilkinson, Head of Living Landscape for The Wildlife Trusts, and Chris Gerrard, Director of Living Landscapes for the Bedfordshire, Cambridgeshire and Northamptonshire Wildlife Trust, gave evidence.

Q95 Chair: Good afternoon. Just for the record, could you introduce yourselves for the Committee?

Chris Gerrard: My name is Chris Gerrard, and I am the Director of Living Landscapes for the Wildlife Trusts for Bedfordshire, Cambridgeshire and Northamptonshire.

Paul Wilkinson: Hello, I am Paul Wilkinson, Head of Living Landscape for The Wildlife Trusts’ UK Office.

Gareth Morgan: I am Gareth Morgan, Head of Agricultural Policy at the RSPB.

Jenna Hegarty: I am Jenna Hegarty, Senior Agricultural Policy Officer at the RSPB.

Q96 Chair: You are most welcome and thank you for contributing to our Inquiry. Could I ask at the outset if you believe the Commission has the balance broadly right between greening measures and food security in its proposals?

Paul Wilkinson: Before getting into the topic of balance I think the issue around greening is a really key principle and it is based around the evidenced idea that a healthy functioning natural environment and ecosystems underpin healthy farming and healthy farming systems. So that is a really key principle of this. The proposal to green part of that Pillar 1 payment is a clear recognition that that is an important principle. Although we support that principle we recognise at the same time that the measures currently on the table are probably not ideal and could be improved, as we stated in our evidence, but at this stage there is not a huge amount of detail on what is being proposed. We are really keen to work with the industry, with Government and its agencies to work out the best possible measures to achieve the best possible outcomes.

Gareth Morgan: We are quite disappointed that there has been a resurgence of a debate recently that food security and environmental quality are somehow opposed. If we go down that route we are going to have serious problems with this reform. I do not think the Commission has come at this from any particular food security perspective to be honest; their primary consideration with this reform is how you legitimise expenditure of €300 billion over the next seven years. That has been the primary motivation and I am not sure that was the ideal place to start. The RSPB’s perspective, and that of a number of other environmental NGOs, is that actually this reform should have been much more radical, should have looked at the two-pillar structure of the CAP and whether that was fit for purpose, and at redefining a longterm mission statement from the CAP. Unfortunately that is not the perspective that has been taken; there has been a salami-slicing approach to try and get the budget under control, and that has not done us any favours as a starting point.

Q97 Chair: The Commission’s aim is to be improving the overall levels of environmental protection in European agriculture; do the green measures really need to be mandatory and uniform across the member states to achieve this?

Chris Gerrard: What we have seen recently is the production of a Natural Environment White Paper as a result of the Lawton Review, which was instituted by the last Government. That clearly identifies the need for a coherent ecological network across the country, and the farmers and the farm landscape have a hugely important role to play in delivering that with the support of conservation NGOs. If we are going to provide some sort of mandatory greening within Pillar 1, it enables us to work within farming communities and the areas in which we work to ensure local farmers can play the really important role they have to play in supporting the development of that network.

Gareth Morgan: Mr Radley alluded to this in his answer to a previous question: it is meant to be a Common Agricultural Policy; in a sense it is a bit unrealistic expecting it to be tailored for the needs of every region and every member state. The proposals the Commission has come up with in trying to green Pillar 1 have bumped into this issue. As Mr Radley said, it is very difficult to design measures that are equally applicable in Finland and Greece, and therefore we have to have some limits to what our expectation of the greening process through Pillar 1 can be. The alternative is to develop very tailored solutions, but then that raises the fundamental question of why have a common policy.

Q98 Chair: The Commission proposes that farmers who do not carry out the greening measures will face an additional penalty. Is that additional penalty really necessary, given that non-compliant farmers already stand to lose 30% of their direct payment?

Jenna Hegarty: Losing 30% of direct payments will be significant for any farmer; it is a large proportion. However, there may well be some very large enterprises that take a look at the greening proposals and what impact that may have on their farm business, and decide that actually they would rather not do them and would like to opt out and potentially take that 30% hit. Greening cannot be optional. It is like cross-compliance: if you are getting public money, the conditions should be attached and you should not be able to opt out if they are inconvenient. If there is an ability to opt out of greening measures, it could end up happening in those areas of the country that are most in need of additional greening. If it is a wilful opting out, then there may be a case for further penalties that may impinge on the remainder of the direct payments that are being given.

Q99 Thomas Docherty: For probity, I probably should say for the record that I am a member of the RSPB. There is an argument that the CAP has already helped to strengthen the environment and improve biodiversity. Do you not think that in these difficult economic times the priorities should be jobs and incomes?

Paul Wilkinson: The proposals and the impact assessment of the greening measures have shown that, as a scenario, they score highest in terms of viable food production, cost effectiveness and value added overall, as compared to other scenarios. So there is potentially some impact on income of the greening measures, because of the higher environmental standards, but that impact assessment also shows that, particularly, the ecological focus area option actually over time enhances income and generates additional income through higher yields. So it is not an income versus the specific measures argument; there is evidence to show that taking this approach and creating areas that help to support future sustainable farming activity-which the ecological focus area particularly measures-is actually about supporting future farming activity. It is about recognising that using natural processes and the natural environment to help purify water and for pest and disease control supports future farming. This is not about farming versus biodiversity; it is about much more and better integration between those two things.

Gareth Morgan: I would just point out that the RSPB has very recently produced a report on the economics of the green economy, looking at issues like agrienvironment schemes. In general, investment in agrienvironment has a much better multiplier effect for employment than just paying out farm subsidies. So if it is rural employment we are interested in here, that would be the route to go down.

Q100 Thomas Docherty: We have various figures in front of us: the Commission’s own figures show that the cost of greening for the EU as a whole will range from €33 to €41 per hectare; the NFU believe the impact assessment shows that income per worker in the pig and poultry industry could fall by 25% as a result of ongoing measures; even the AHDB finds that the gross crop margin will go down by up to £50 per hectare. Surely that, in the current climate, is not a price worth paying?

Paul Wilkinson: Having listened to the NFU evidence yesterday I have actually gone through the impact assessment and cannot find that 25% figure.

Q101 Chair: I am reliably informed it is Annex 2.

Paul Wilkinson: Thank you. For the record, page 58 gives a figure of between minus 3.2% and plus 1.4% in terms of a decrease in average income. Obviously that is average; it does also make clear in here that particular sectors will be affected differently. The really important message that comes across throughout this impact assessment, regardless of some of those specific figures, is that although the greening measures can potentially have a short-term impact on annual income, the longer-term impact is positive. This is really about the future of sustainable farming-working much more closely in harmony with those natural processes. Rather than drawing out particular worst case scenarios-and in the case of pig and poultry that is obviously a really critical figure-if this is taken in the round, overall there are longer-term gains to be had.

Gareth Morgan: It is fair to say that greening measures are unlikely to be cost free. I would be very interested to see what assumptions have been made in deducing those figures; there is no detail to the greening proposals the Commission has provided so far, so we do not actually know what the impact on production is likely to be. The Commission’s suggestion was that it is likely to be really very small. It is interesting how selective people are about these things; I imagine that is referring mostly to the ecological focus areas. We do not hear this concern about the impact on prices when, for example, a large amount of land is currently being devoted to biofuel production. That is equally having an impact on grain prices, but we do not hear about that in the same way. Why not? You have to make choices about how to deploy land and some of your deployment of land has to be for environmental purposes.

Q102 Thomas Docherty: Turning to the issue of coherence with agrienvironment schemes-obviously there are options available for Entry Level Stewardship and how funding will be done-do you believe farmers in agrienvironment schemes should automatically qualify for the greening payments?

Chris Gerrard: You focus on the ecological focus area of the greening proposals; it seems to us that if areas of land that qualify for the EFA are already in agrienvironment then we see no reason why the two should not overlap. Essentially the Pillar 1 payment is paying for the existence of the feature, or possibly the creation of the feature, with agrienvironment paying for the proper, appropriate management of those features.

Jenna Hegarty: It boils down to the land and its suitability. I would not suggest that simply being in an agrienvironment scheme would be a free pass for greening; it would depend on what options you are using. As long as they are appropriate and suitable for ecological focus areas then yes, that footprint should certainly count towards the greening requirement.

Q103 Thomas Docherty: We have heard some suggestion that the greening proposals mean that Entry Level Stewardship would become superfluous. Would you think that is a fair assessment?

Gareth Morgan: Absolutely not. You have to be quite clear about what can be done under Pillar 1 and under Pillar 2. Although there are criticisms of the entry level scheme, it has a level of sophistication and local tailoring that cannot be replaced by a simple measure through Pillar 1. That doesn’t mean there aren’t some useful things that can be done through greening Pillar 1, but we need to find a way to ensure we integrate what is being done through the entry level scheme with the greening proposal. The greening proposal should not be seen as a substitute for that.

Q104 Neil Parish: Your evidence suggests that the greening measures do not go far enough, while the farmers think they are too burdensome. Is this conflict inevitable? The RSPB and farmers in many areas work extremely well together, and I would suggest to you that these schemes are much better done on a voluntary basis and you will get much greater co-operation and environmental and nature benefit than when forcing farmers down this route. Do you not think you will just cause a lot of antagonism? What do you feel?

Gareth Morgan: It is no surprise and no secret that the RSPB has long been a fan of Pillar 2 type approaches. What we have on the table is a situation where the Commission has decided not to go down that route and the view of the UK Government is unlikely to prevail. We have a situation where we are likely to continue with the current model until 2028-looking at the detail of the document here-because that is the Commission’s thinking. So at that point you have to make a decision on which horse you are going to back, or which Pillar you are going to back-perhaps that would be a better metaphor for that.

Will this cause antagonism? I think you could take a more creative look at greening. Forcing compliance type measures into Pillar 1 may not be the route; you could be looking at how you target your Pillar 1 payments at this point: which farming systems deliver most for the environment and are most in need of support? That receives very little attention in the proposal and that could be an avenue to go down that I think would cause much less friction in the farming community, because it does have to face up to the issue that we have to redistribute the way we deal with Pillar 1.

Q105 Neil Parish: I wouldn’t be quite as negative as you are on the question of these proposals from the Commission being met with uniform glee. What we have heard from the Council of Ministers so far is that lots of member states don’t like them. Perhaps there is a way that you can co-operate more together. We don’t want the Commission to divide and rule; is that a fair point or not?

Gareth Morgan: There is scope for tailoring of the greening proposals by member states. The problem we will have to confront there is that there will be member states who decide to tailor them in a way that then destroys your level playing field, so you do have to find a way to guard against that. As I said earlier, if you are going to get environmental benefit, there is a limit to how much you can do that across 27 member states with universal prescriptions. Squaring that circle of tailoring with making sure we do not leave behind those member states who will choose to use that opt-out is the challenge for member states at this point.

Q106 Neil Parish: We all believe in the necessary ecological focus areas; the margins around fields and all these types of things we see as great benefits. But the Commission has this idea that there has to be a crop rotation; do you not think that is actually going in the wrong direction? I don’t suppose we are going to grow cotton quite yet in this country, but it is one of the ecologically worst crops you could grow. What is the point of the Commission suddenly putting in this idea that you have to have three different crops? What is your view on crop rotation versus ecological focus areas, if it comes down to that in the end?

Paul Wilkinson: Good Lord, there is a lot wrapped up in that question! The first issue, diversification versus rotation, was covered by the previous speaker. The way that Geoff Radley described it, as an unusual step, is something we would support. However, diversification is not necessarily a bad thing and there is evidence to show that huge monocultures do not necessarily deliver for the environment and for soils. Some degree of diversification is a good thing. The problem with the measure on the table is where you have farmers growing crops for fodder with fairly small thresholds, who might decide not to grow that altogether and come out of that arable. There is an unintended consequence there. The other unintended consequence, potentially, is of high-value land being brought back into production so it does not fall into that category. For us that is a much higher risk-that there are potentially high-value grasslands or areas that are brought back into production that perhaps would not have been otherwise.

Q107 Neil Parish: There will be pressure to reduce the percentage of farmland given over to ecological focus areas. What evidence is there to determine what percentage of farmland should be taken out of production in order to deliver environmental benefits? In your ideal world, what percentage would you want to take out of production?

Jenna Hegarty: Unsurprisingly, echoing what a previous speaker said, there is not a magic figure that we are now going to produce for what should be. There is a fair degree of evidence that the 7% the Commission is proposing for EFAs is the bare minimum we could live with. There is the very current example of the Farmland Bird Package in the Campaign for the Farmed Environment, which requires 3% to 4% of infield options. The Commission proposals, whilst the detail still needs to be considerably fleshed out, do refer to much more than those kinds of figures; they talk about landscape features and various other things. It would be more than 3% to 4%. There was also quite a lot of work done post-health check when setaside was abolished, and there was a lot of work to do around setaside mitigation. There was also some work Natural England did in 2009, which calculated that the area of land required to mitigate the loss of setaside would be a minimum of 4% to 5%, with targeted management on top of it. If you are looking at an EFA requirement of 7% that includes landscape features and does not have any management requirement, then it is actually looking very conservative.

Q108 Neil Parish: So you would take out 7% of productive land irrespective of food security, whatever happens?

Jenna Hegarty: As I just said, that 7% is much more than productive land. It covers landscape features-so hedgerows, lines of trees, wet areas, scrubby areas and gorse. Most farms will have those features in some degree and, as we have already talked about, many farms in England are in Entry Level Stewardship and Higher Level Stewardship. If you count the footprint of those areas they will be a long way to meeting the EFA requirement, if not already there. In our evidence, we give Hope Farm as an example. We would have very little difficulty, if any at all, in meeting that 7% because of the features we already have on the farm and the fact we are in Entry Level Stewardship. Those farms that literally have no features or are not an agrienvironment-I imagine there are very few-are probably exactly the areas where you do need to inject this habitat and heterogeneity that is absent. That is not just for biodiversity. It is for resource protection, and many of these features can serve agronomic functions too.

Chris Gerrard: If I may add to that, it is very important that it is not seen as 7% coming out of production, as has been described already. A lot of those features already exist in the landscape, so it is not a new amount of land coming out of production.

With respect to food security, of course the amount of land given over to food production has an impact on the amount of food we can produce. But if we are truly to improve food security for those people around the world who are currently hungry, and to continue to provide food security for a growing population, then in terms of the European and certainly the UK footprint, the actual amount of land in production is a smaller issue. That is particularly with the amount of variation that we are talking about. We need to be focusing much more on the distribution of food, the production of food, minimisation of waste and innovation in food production, rather than looking at maximising the area of land under production. Underpinning all this is the false dichotomy that you can choose to have food or wildlife; we actually need both. The National Ecosystem Assessment shows pollination is worth £430 million to UK agriculture; for our pollinators we need the semi-natural areas in our landscapes.

Q109 Neil Parish: I think we all accept that we probably have more than 7% of land in the UK in environmental stewardship of some type-in some type of scheme. But the point I want to make to you is, are you not worried about the prescriptive side of the Commission’s proposals, where you might well see 7% of some of the very best land in the country-producing 10 or 12 tonnes of wheat per hectare-being taken out? Is there a justification for this? There are 7 billion people in the world now and rising; there has to be a balance. We all want to see ecology, but has the Commission got it right where you are taking out good quality land?

Gareth Morgan: I do not want to belittle the issue of food production; I think it is immensely important. First of all, this land is not being taken out of production in perpetuity. It may well be that it is brought back into production if needed at a future date. At the minute there are issues of food distribution in the world, but people are not going hungry because there isn’t enough food produced in the UK; it is much more complicated than that, so I think we need to move beyond that sort of argument. As well as that, we have to come back to the Commission’s position in this. If this is not the right prescription, we still need to find a way to justify to the wider public what public goods large cereal farmers are delivering for the payments they are receiving. If this is not the right solution, we have to find other ways of ensuring they are delivering green services. I have not found an alternative proposal at the moment.

Paul Wilkinson: I refer to a paper from the International Centre for Trade and Sustainable Development, which looked at this issue and identified that there could be some short-term reductions in production capacity. However, they showed that in the longer term there is positive feedback from more sustainable agricultural practices, in terms of higher yield. What we are talking about is not an either/or; it is an "and". It is about looking at how we manage the whole area in a much more joined-up, sensible, holistic way to achieve all these different outcomes: more food and more wildlife. That is the critical thing, and this international report has shown that is possible through these kinds of activities. The other thing is that we are looking for a win-win effect. In yesterday’s evidence, I cannot remember who but one of your interviewees said they could not see any win-win effects. Actually, some of these activities are around supporting climate change adaptation, and without some of these activities to adapt, productivity will not increase anyway.

Q110 Chair: Could I ask one specific question of the RSPB? You state in your evidence that greening is necessary to maintain the EU’s productive capacity for future food security. How do ecological focus areas contribute to securing the EU’s future productive capacity?

Jenna Hegarty: In a range of ways. Again, a lot of this will boil down to how EFAs are fully designed and implemented. On a basic level, if you include hedgerows in EFA, they are features that can help to stabilise soil and reduce soil erosion and wind erosion, which is protecting a vital resource of food production. Where you place buffers by watercourses, again, that reduces the negative impacts of agriculture on water quality. Having healthy water resources is critical to food production. Providing food and nesting resources for a variety of wildlife supports functional biodiversity, like the pest-controlling wasps that were referred to earlier. These are all things that are functional benefits for agriculture-vital for long-term environmental security and food security.

Q111 Chair: Mr Wilkinson, you said earlier there are longterm quantifiable gains. How do you quantify them and what are they?

Paul Wilkinson: I think I was referring to the impact assessment, which actually talks about enhancements in overall annual incomes.

Q112 Chair: It would help the Committee if you could give us a concrete example.

Paul Wilkinson: Page 58 in the impact assessment.

Q113 Chair: You actually said there were longterm quantifiable gains. I thought you might be able to help the Committee by telling us what they are.

Paul Wilkinson: I am sorry; I did not write the report.

Q114 Chair: So you are just quoting from the report.

Paul Wilkinson: I was quoting a figure around the uplift in farm income and the positive effect of the ambitious ecological focus area measure.

Q115 Chair: You mentioned climate change mitigation in response to Mr Parish. You have read the evidence we had from the NFU yesterday. They are concerned that farmers might be unwilling to sign up to Entry Level Stewardship because it would make them ineligible for mandatory greening. Are you concerned that greening Pillar 1 will result in member states allocating less funding to agrienvironmental schemes than they do currently and that, in the interim, there may be fewer farmers signing up because-as we have heard from a succession of witnesses this afternoon-they do not know what the content of the greening regulations are going to be?

Paul Wilkinson: On the first point about climate change, I was referring to adaptation rather than mitigation. It was the adaptation point around soil management, water quality and water management-those were the key points I was mentioning. It is critical that there be greater clarity and more detail from the Commission on the nature of the proposals, in order actually to reduce that level of uncertainty. We would certainly be concerned if there was less uptake of those schemes in the short term because-referring to the question raised earlier by Mr Parish-of that level of uncertainty: because of the fact that people might not be aware that they can leave the scheme in the future, and because of the uncertainty around what these measures might mean for them. We would hate to think that people were therefore not entering the schemes, so greater clarity as soon as possible would be a good thing.

Q116 Chair: Would you concur with that?

Gareth Morgan: Yes, you are absolutely right: there is a significant danger that member states will be allocating less to agrienvironment. The budget figures for the CAP that have been produced suggest that the Rural Development Budget will be cut by 8%. We know the Treasury is not going to be throwing money around when decisions have to be made about funding for the next Rural Development Programme in 2014. There is the potential for the greening of Pillar 1 measure to reduce some of the pressure that is currently on Pillar 2- to take up some of the gap and release funds to make sure we continue with as good an environmental stewardship programme as we can after 2014. I am still hopeful that with some smart negotiations, the UK Government can make sure we get a settlement that lets us maintain the current Rural Development Programme, but we have to be prepared for the possibility there will be significantly less money.

You are also right that there is a danger that farmers are showing their concern by not signing up for entry level schemes. I was very reassured to hear from Natural England that that is not borne out by the figures to date. Defra is now in a position to give them the assurances they need that mean they can go ahead and sign up for these schemes. It would be good to hear that as soon as possible, so that they can plan ahead and keep joining.

Q117 Chair: I think you said earlier, Mr Morgan, that you thought the Commission were less than ambitious and you would like to have seen both Pillars scrapped.

Gareth Morgan: That is a little bit of an extreme characterisation of my position. We produced a paper with BirdLife and the European Landowners’ Organisation-the umbrella for the CLA in Europe-early in this process, suggesting that it was time to move to a one Pillar CAP. I am not sure this business of having two separate Pillars is actually serving us at the moment. We have a lot of clarity over what the second Pillar is for, but we are still very unclear about what the first Pillar is for. Is it an income support? It does not really seem to function effectively in that way. Is it meant to achieve food security? Well, it is not tied to any production. So it would have been nice to see a more imaginative proposal about what the CAP should look like after 2020. The Commission has decided to stick to the current model and it is going to be more and more difficult to maintain that beyond 2020.

Chair: These are the early stages of the negotiations, so I am sure we will have opportunities to explore this, but can I thank all four of you, and all the witnesses this afternoon, for contributing and being so generous with your time?

Prepared 30th November 2011