The Agriculture Bill and the Environment Bill

Even prior to the arrival of Covid-19 in the UK, concerns were raised that the Agriculture Bill and the related Environment Bill did not strike the right balance between food security and environmental issues. Given recent market shocks, we examine whether food security is being adequately addressed and look at some of the other issues that will need to be monitored closely as these Bills progress through Parliament.

Recent upheavals in demand and supply

Having come through the uncertainty surrounding the withdrawal phase of Brexit – though still with the prospect of much more negotiation in the pipeline - the agricultural industry has had to deal, in rapid succession, with Covid-19 inspired panic buying of food, the dramatic collapse in demand from the restaurant trade and resultant disruption to the supply chain.

We hear of farmers pouring milk into their slurry tanks because their contracted retailer has not picked it up; asparagus, lettuce and other crops awaiting harvest because of limited availability of trained personnel to do the job; fish coming to land with no buyers. Some in the Industry have trialled other ways of marketing their products, though those remote from large urban markets have found it more difficult.

The lucky break has been the recent warm, dry weather which has allowed the farming industry to self-isolate upon their tractors as they planted potatoes and drilled spring crops in fields that would normally have been prepared in the Autumn but were flooded or rain soaked at that time.

Importance of food security

Food security is vital to the future of this country as we can see the problems that arise in times of trouble. It was one of the main reasons that, after the Second World War, the Common Market and the Common Agricultural Policy of Europe came into being. It is vital that our Government replaces the existing agricultural support structures with a framework that strengthens and improves British Agriculture for the future.

The current Agriculture Bill was originally issued in the Autumn of 2019 and after considerable discussion with the various Industry bodies (the NFU, CLA, AVA and other interested parties) a revised draft version was published on 30th January 2020.

Much criticism had been aimed at what appeared, in the original Bill, to be benefiting principally environmental issues rather than that of feeding the nation.

Does the revised Agriculture Bill answer concerns about food security?

Clause 1 of the Bill gives the Secretary of State permission to give financial support in 10 main areas and 2 ancillary areas.

At sub clause 1.4, in framing such support, they are “to have regard to the need to encourage the production of food by producers in England and its production in an environmentally sustainable way” so, yes, at least the production of food is acknowledged as part of the desired behaviour of the Industry.

The first five support areas are environmental, public access and education in the countryside and water management, perhaps better identified as part of the Governments desire to improve flood management. Livestock are mentioned at 1.1(d) but only in relation to farming land to mitigate or adapt to climate change.

The remaining five sub-clauses of 1.1:

(f) deals with improving livestock health and welfare

(g) conserving native livestock, native equines or genetic resources for same

(h) protecting or improving plant health

(i) conserving plants grown or used in agricultural, horticultural or forestry, and

(j) protecting or improving  the quality of the soil.

Section 1.2 allows payments to (a) starter producers or producers wishing to improve their agricultural , horticultural or Forestry business and (b) Supporting “ancillary activities” (defined as selling, marketing, preparing, packaging, processing or distributing products  deriving from agricultural, horticultural and forestry activity) carried on or to be carried on by or for a producer.

Whilst better from a farming point of view than the original version it is still clearly, together with the Environment Bill, intended to address the Government’s interests in climate change and in particular cutting emissions and decreasing flood risk above food production for the nation.

Food security is vital and that has been underlined in our current difficulties and whilst the general public is much more food source aware than twenty years ago, in a food panic are they going to ask if their chicken is chlorinated or not? In periods of food scarcity or joblessness concern over food supply and costs are likely to outweigh niceties as to food sources.

Complex transition of the payments regime

The Bill confirms that a payment equal to the current EU Basic Payment Scheme payment (gone from 2020) will continue on a reducing basis for a period of 7 years from 2021. We are aware that the reduction in the first year will be 5% for holdings receiving up to 30k in payments and, for holdings with payments over £150k, a 25% reduction. Information for following years is awaited but the prospect of any other direction than down is unlikely.

The Bill creates new annual financial assistance plans the first of which will be for 7 years from 1st January 2021 and thereafter each scheme to be for at least a period of five years. The payments will be policed with powers to inspect, search and seize together with financial penalties for non-observance of the rules of the Scheme which could affect access to any future schemes too.

The new ELMS (Environmental Land Management Scheme) payments are expected to be available to farmers and Landowners from 2024 and will replace the current BPS payments and Stewardship Schemes by 2028. These payments are based on the Government’s “Public money for public goods” and “Natural Capital” concept i.e. support is not for feeding the nation but in providing that plus more importantly the Environmental benefits required. Pilot schemes are in place. The system will probably have three tiers of agreement but further information is awaited.

As the Bill is an enabling Act, it makes provisions in many other areas including fertilizers, identity and traceability of animals, carcass classification, red meat levy, organic products and marketing standards, agricultural producers and the food chain – all of which are areas of their own for future consideration when more detailed regulations are available.

The new Environment Bill and potential transfer of liabilities to new owners or lessees

The new Environment Bill published on the same date contains provision for “Conservation Covenants”(CC) to be included in agreements between landowners and “a responsible body” (as designated by the Secretary of State) where the agreement is in writing and intended to create a conservation covenant and contains provisions:-

1. Of a qualifying kind (that you specifically agree to  do or don’t do something).
2. Has a conservation purpose (a) to conserve the natural environment of land or natural resources of land (b) to conserve land as a place of archaeological, architectural, artistic, cultural or historic interest or (c) to conserve the setting of land with a natural environment or natural resources or which is a place of archaeological architectural artistic cultural or historic interest.
3. Is intended by the parties to be for the public good.

These agreements can be granted by a freehold owner or by a lessee (as long as the lease has at least 7 years left to run) and is likely to need a landlord’s consent depending on the terms of the lease (ie Agricultural Tenancy Agreement or Farm Business Tenancies or other). They will be a Local Land Charge and so will be recorded as such.

The covenants will affect the land concerned for the period of the agreement and, if you sell or lease the land during the period of the agreement, the person buying or leasing the land will become liable for the terms of the agreement until it terminates instead of the original owner/lessee. It will need to be dealt with upon sales or in preparation of leases with care.

The obligations can be enforced by specific performance, injunction and by payment and damages orders if breached and under the limitation Act the CC is to be treated as founded on simple contract as regards time limits.

Statutory defences to the breach are:-

• The breach was a matter beyond the landowner's control
• That the breach arose from an emergency where to do or not do the required action would have incurred injury or loss of life to any person.
• At the time of the breach the land was within an area designated for public purpose and compliance with the CC would have breached a statutory control applying to that designation and that the landowner had taken all reasonable steps to obtain such authorisation. (This defence is only available if the CC was in force before the designation was created).

The CC can be modified or discharged with the responsible body by mutual agreement and by the Upper Tribunal. The County Court and High Court can allow a party against whom proceedings are taken to apply to the Upper Tribunal.

We will be watching out for and reporting back on ‘the devil in the detail’

The Agriculture Bill and Environment Bill remain ‘Bills’ currently and will only become Law when passed through Parliament; there may be further amendments. However, the intentions of the Government have been clear and unless the recent difficulties of food chain supply and food security change that thinking “Natural Capital and Public Money for Public Goods” philosophy will be the direction of travel.

Jennifer Bartram