Rural Economy and Connectivity Committee

Meeting date: Wednesday, December 2, 2020

Official Report 691KB pdf

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Subordinate Legislation

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Plant Health (EU Exit) (Scotland) (Amendment etc) Regulations 2020 [Draft]

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Trade in Animals and Related Products (EU Exit) (Scotland) (Amendment) Regulations 2020 [Draft]

Item 3 is consideration of two affirmative instruments, on which the committee will take evidence. The motions to recommend approval of the instruments will be considered under items 4 and 5. Members should please note that no representations have been made to the committee on the instruments.

As the two sets of regulations relate to plant health and to trade in animals, I formally note my registered interest as a member of a farming partnership in Moray. Peter Chapman and Stewart Stevenson want to make similar declarations.

I declare my membership of a farming partnership in Aberdeenshire.

I am the joint owner of a very small registered agricultural holding, from which I derive no income.

I welcome from the Scottish Government Mairi Gougeon, the Minister for Rural Affairs and the Natural Environment; Rachel Coutts, lawyer; John Speirs, senior policy adviser; Keith White, lawyer; and Jesus Gallego, deputy chief veterinary officer. Would the minister like to make a brief opening statement on the two SSIs?

Yes. Would you like me to talk about both sets of regulations at the same time or to talk about the plant health regulations first?

We will consider and take questions on the plant health regulations first, and then consider the other regulations, if that is all right. That is easier for the record.

No problem, convener. I will give the committee a brief overview of what we are trying to do with the draft plant health regulations. Their purpose is to revoke and remake European Union exit provisions relating to plant and tree health to ensure that we maintain and continue to protect Scotland’s agriculture, forestry and horticulture sectors and the wider environment from pests and diseases when Scotland leaves the EU.

The committee will recall that the Forestry (EU Exit) (Scotland) (Amendment etc) Regulations 2019 and the Plant Health (EU Exit) (Scotland) (Amendment etc) Regulations 2019 were drafted last year, when we were looking at a possible no-deal Brexit in March 2019. The instruments were laid before the introduction of the new EU plant health and official controls regime that became applicable in December 2019, which means that they must now be revoked.

The 2020 regulations deficiency fix the new domestic regime that is to come into force on 1 January 2021 and make provision to update domestic plant health legislation before it becomes retained EU law. The changes that the regulations make are necessary to ensure that the current domestic plant health legislation continues to operate effectively after the end of the transition period. In addition, it is important that our legislation is efficient to ensure that any associated burdens on business are proportionate.

The 2020 regulations introduce a provision in relation to import fees, which will be in effect only from implementation period—IP—completion day until 31 March 2021. Allowing the regulations to pass will reassure anyone who is associated with, or interested in, the plant health sector that we are committed to protecting Scotland from pests and diseases that are not known to occur here.

I am happy to take any questions that the committee may have.

Thank you, minister. We are having a slight issue with the technology, but we can work through it. Do members have any questions on the regulations?

As there are no questions, I ask the minister to comment on the second SSI, which is the draft Trade in Animals and Related Products (EU Exit) (Scotland) (Amendment) Regulations 2020.

The primary purpose of the regulations is to ensure that we have a functioning system of controls on imports of live animals, products of animal origin, germinal products and animal by-products following the United Kingdom’s withdrawal from the EU and the end of the transition period. The regulations should be read in conjunction with the Official Controls (Animals, Feed and Food, Plant Health etc) (Amendment) (EU Exit) Regulations 2020, which the committee has already had the opportunity to scrutinise; those regulations are undergoing passage through the UK Parliament.

The committee will be aware that it is the intention of the Scottish Government, along with other Administrations, to align with current EU legislation and EU-derived domestic legislation as fully as possible where that is practicable and appropriate. That is the case with the legislation on official controls that are carried out to verify compliance with those rules in order to protect human and animal health.

The instrument is necessary in order to ensure that appropriate official controls are carried out on animals and products entering Scotland from a third country, so as to protect human and animal health following the UK’s withdrawal from the EU.

The 2020 regulations as framed are principally concerned with technical changes so as to ensure that controls on imports of live animals and animal products verify that imported goods continue to meet the specific import conditions that are laid down in retained EU law. The changes to the regulations will reflect the fact that the United Kingdom is no longer a member state and that third-country controls will be applied to imported goods from the EU in a phased way. That approach has also been adopted by other Administrations, in order to ensure that we have a consistent Great Britain-wide approach.

On that basis, it is considered to be necessary that the changes are made in order to secure continuation of an effective regime for official controls on the trade in animals and animal-related products and to provide for continuity of business on our exit from the EU.

I hope that that provides members with sufficient assurance as to why the changes are being made and why the Scottish Government deems them necessary. Again, I and my officials are happy to take any questions that members may have.

Thank you, minister. There are a few questions. We will go to Mike Rumbles first.

The explanatory note says:

“Regulation 2 of these Regulations makes amendments to the Trade in Animals and Related Products (Scotland) Regulations 2012”,

and the policy note, under the heading, “Purpose of the Instrument”, says:

“To make changes to the Trade in Animals and Related Products”.

So far, the emphasis has been on imports and not on exports. I assume that trade means both. Although I fully understand the need for regulatory change for the imports and therefore see nothing wrong in the instrument, I am curious as to why, when the instrument talks about trade in animals, we are focused on imports with no mention of exports.

That is why the instrument is needed. I have talked about the other regulations. This instrument is needed to give effect to the official controls regulations and the phased process that we have set out. If we did not have the phased approach in place and we did not set out the system for imports, as of 1 January 2021, we would face full checks on everything being imported into GB. That is why the SSI is necessary. It gives effect to the wider regime that has been put in place through the official controls regulation.

Can I follow that up, convener?

Absolutely.

I mentioned that we had a technology issue. We now have all the screens working and can see the minister.

I understand all that, minister. That is what it says in the policy note. My question is not focused on the imports. I agree with you that we need the regulations. The policy note and the explanatory note talk about trade, but the regulations itself does not mention the trade both ways. I understand the importance of imports, but my question to the minister is: why is there no mention of exports? Is the answer that we do not need to mention exports? If there is a need to mention exports, why has it not been mentioned?

I can no longer see the screen. Minister, do you want to bring in one of your advisers on that subject?

I would just like to answer Mike Rumbles briefly, and then my official, Jesus Gallego, can come in with further information. [Interruption.]

I remind everyone of the importance of muting phones when they are participating remotely as well as in the committee meeting room. I do not know whose phone that is, but I will not point any fingers. Surely it is not your phone, minister.

Definitely not.

The EU has already set out its position. That is why we have seen so much concern from the industry in Scotland about what will be needed for exporting goods. We have taken a phased approach to imports coming into GB. We have had to adopt that position because otherwise we would not have had the infrastructure in place to be ready on day 1. That is where export businesses face serious issues. First, they do not know what trade agreements might be in place. All the controls that we are looking at phasing in for imports, they will face as of 1 January when they export to the EU.

You will have seen that Scotland Food & Drink wrote an open letter to the Prime Minister asking for a six-month grace period in having to provide export health certificates because of the burden that that puts on businesses that have been dealing with the Covid situation.

I hope that I have been able to make the position clear. We have introduced the phased checks in order to manage imports as best we can, given the situation that we are in. The EU checks will be applied as of 1 January, so we did not need the legislation here, because the official controls regulations have been put in place.

Jesus Gallego might have something further to add to that.

09:00  

I will clarify the situation with exports: this set of regulations is only part of the full range of different pieces of legislation that deal with international trading in products of animal origin.

As the minister mentioned, there is another set of regulations. The Official Controls (Animals, Feed and Food, Plant Health etc) (Amendment) (EU Exit) Regulations 2020 is a UK instrument that includes matters of devolved competency. That has already gone through its passage through the Scottish Parliament and it is now with the UK Parliament.

There are prohibitions that deal with trade in the UK regulations, too. They deal primarily with imports, like this SSI. However, any changes that are required in legislation for exports are done through the official controls regulations that are amended by the UK regulations.

Rules on how to trade from the UK to the EU on exports are primarily made by the EU and we have relatively little legislation in place to implement controls. We implement export controls administratively or through the powers that we already have, because from 1 January 2021 export controls to the EU will be identical to the ones that we already have for third countries. Therefore, little requires to be fixed.

I think that Mike Rumbles is happy with that answer. Peter Chapman wants to come in.

I am concerned about the export question, too. We have heard that England proposes to ban live exports from the beginning of January, once we are out of the EU. In Scotland, there is worry about that principle because, for example, cattle from Orkney and Shetland must go south to be slaughtered. If we open that door and say that it is not a good idea to export animals across the channel—20-odd miles of sea—but it is okay to haul them from Shetland, which is a considerably longer distance, that might have a serious effect on the farming industries in the islands. Therefore, what is the Scottish Government’s position on the export of live animals after 1 January, and do the regulations have any effect on that?

Minister, I ask you to be fairly tight in your answer to that question, because it stretches into exports and we are dealing with imports. Perhaps you can just confirm whether the SSI deals with exports, and then I would be delighted if you want to write to Mr Chapman and the committee about the export issues separately, because they are not part of this agenda item.

That is absolutely fine. I am happy to write to the committee and give more information about that. However, what Peter Chapman mentioned is not affected: we are not changing any policy on maximum travel times; they are already fixed in legislation and we are not looking to change that at all.

We are progressing other measures that relate to the Farm Animal Welfare Committee’s report, “Opinion on the Welfare of Animals during Transport”. I am happy to write to the committee and provide information on that. However, we are not looking to make additional policy changes in that area as part of this instrument.

Thank you for confirming that, minister. As no other member wants to ask a question, we will move on to the next agenda item. Item 4 is formal consideration of motion S5M-23354, in the name of the Minister for Rural Affairs and Natural Environment.

Motion moved,

That the Rural Economy and Connectivity Committee recommends that the Plant Health (EU Exit) (Scotland) (Amendment etc) Regulations 2020 [draft] be approved.—[Mairi Gougeon]

Motion agreed to.

Item 5 is formal consideration of motion S5M-23469.

Motion moved,

That the Rural Economy and Connectivity Committee recommends that the Trade in Animals and Related Products (EU Exit) (Scotland) (Amendment) Regulations 2020 [draft] be approved.—[Mairi Gougeon]

The minister does not wish to comment further. Do members have any comments?

All I want to say is that, as the minister and her officials have just confirmed that the regulations are about imports and not exports, I am happy to approve it.

Motion agreed to.

Minister, you and your team are excused at this stage. Thank you for the evidence that you gave us this morning.

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Common Agricultural Policy (Less Favoured Area Support) (EU Exit) (Scotland) Amendment Regulations 2020 [Draft]

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Direct Payments to Farmers (Miscellaneous Amendments) (Scotland) Regulations 2020 [Draft]

Item 6 is an evidence session on two SSIs. The motion seeking approval of the affirmative instruments will be considered under items 7 and 8. Members should note that there have been no representations to the committee on the instruments.

I welcome, from the Scottish Government, Fergus Ewing, Cabinet Secretary for Rural Economy and Tourism; John Kerr, head of the agricultural policy division; Andrew Crawley, a lawyer in the legal directorate; and Lynne Stewart, head of the direct payments, rural payments and inspections directorate. I invite the cabinet secretary to make a brief opening statement on the two instruments.

Good morning. I thank the committee for taking the time to consider these important regulations and for giving me the opportunity to address members.

The draft Common Agricultural Policy (Less Favoured Area Support) (EU Exit) (Scotland) Amendment Regulations 2020, which were laid using powers conferred by the European Union (Withdrawal) Act 2018 and the Agriculture (Retained EU Law and Data) (Scotland) Act 2020, will ensure that payments to farmers, crofters and land managers can continue under the current less favoured areas support scheme from 2021. We need to do that as, under the current Scottish rural development programme, LFASS is intended to work only in the period from 2014 to 2020.

The regulations also reverse the cuts that EU law required to be made in 2019 and 2020. The Scottish Government did everything that it could to mitigate the impact of those cuts, and I am now pleased to be able to set payment rates from 2020 onwards at the higher 2018 rate. It is essential that LFASS payments continue at the higher rate in order to support the Scottish rural economy during Brexit and the recovery from the Covid pandemic.

The regulations also make some minor simplifications and improvements, and they fix a deficiency in the LFASS rules that would otherwise have effect on the implementation period completion day.

My officials and I are happy to answer any questions that members have.

Thank you, minister. Peter Chapman has a question.

I am delighted to hear that you are returning LFASS payments to the levels that they were at prior to the cuts that were imposed by the EU. Where is the money coming from to reinstate those levels?

We seek to maintain the level of LFASS at the full rate from 2021, during the period until 2024. In other words, my intention is that that should be the case. Formal decisions have not yet been taken on that.

There is one very good reason for that, which is that the Scottish Government’s ability to continue to pay the LFASS farmers, whose work in producing food and looking after the countryside means that they earn and deserve the payment—I do not look at it as a subsidy—depends on the continuance of funding that was formerly received from the EU through the UK Government. At the moment, there are serious questions about whether there will be sufficient funding up to 2024-25, and there is a real concern that the UK will impose cuts by failing to match what the EU would have provided to Scotland.

Nevertheless, despite the difficulties that have arisen in the past few weeks as a result of a unilateral decision by the UK Government, I intend to proceed to ensure that our hill farmers and those on islands who are farming the more difficult land continue to receive that support.

My approach has been one of stability and simplicity, and part of the stability element is that businesses need to know where they stand in farming and crofting not just for one year, but for multiple years. That was one of the many benefits of EU membership, because programmes were for seven-year periods and not just year-to-year budget periods. That is one of the problems that the UK Government is making in approaching things on a year-to-year basis and not on that seven-year basis.

I have to challenge the cabinet secretary on what he has just said. When George Eustice was before the committee just last week, he confirmed that, in the lifetime of the current Westminster Parliament, which has about four and a half years to go, the UK Government will guarantee that £595 million will come to Scotland to support Scottish agriculture. He also made the point that EU funding is being cut by 10 per cent, mainly because we are no longer making a contribution to the EU. I refute the argument that we would have done better in the EU than we will do outwith it.

I am going to get into so much trouble with my colleagues if I shut this conversation down, because it relates to a statutory instrument that has been laid and its principles, which the cabinet secretary alluded to. Cabinet secretary, I will allow you to make a brief response and then I will move on to other questions.

I am afraid that Mr Chapman is not correct. There will be a substantial reduction in funding as a result of the failure of the UK to honour its pre-Brexit promises to match EU funding. We calculate that the amount of the cuts that are made by Westminster for Scotland will be £170 million between now and 2024.

We are definitely going to leave that there.

As committee members have no further questions, I ask the cabinet secretary whether he would like to make any comments on the draft Direct Payments to Farmers (Miscellaneous Amendments) (Scotland) Regulations 2020. I am happy to allow you a brief moment to speak to them, cabinet secretary.

I have a short opening statement. The regulations were laid using powers conferred by the Agriculture (Retained EU Law and Data) (Scotland) Act 2020, which received royal assent on 1 October 2020. The act empowers Scottish ministers to make regulations that modify the main common agricultural policy legislation to ensure that it will continue to operate effectively in Scotland beyond 2020. That includes enabling Scottish ministers to set direct payment ceilings. The regulations specify the manner in which Scottish ministers will determine the annual total ceiling for Scotland as part of the annual Scottish Government budget process. Our aim is to provide stability and continuity to farmers and crofters in so far as we are able.

09:15  

The draft regulations also make technical amendments to ensure operability of the existing direct payment schemes in Scotland for 2021 and subsequent claim years, and they remove provisions that are spent or not in use in Scotland. Unless the regulations are approved and brought into force by 1 January to enable a ceiling to be determined for 2021 and subsequent years, we will not have a basis for making direct payments next year and beyond.

My focus now is to continue to ensure that we in Government fulfil our role of supporting our farmers and crofters by doing all that we can to ensure that payments can continue to be made to them next year and in subsequent years.

Thank you, cabinet secretary. As members have no questions, we move to item 7, which is formal consideration of motion S5M-23419.

Motion moved,

That the Rural Economy and Connectivity Committee recommends that the Common Agricultural Policy (Less Favoured Area Support) (EU Exit) (Scotland) Amendment Regulations 2020 [draft] be approved.—[Fergus Ewing]

Motion agreed to.

Item 8 is formal consideration of motion S5M-23264.

Motion moved,

That the Rural Economy and Connectivity Committee recommends that the Direct Payments to Farmers (Miscellaneous Amendments) (Scotland) Regulations 2020 [draft] be approved.—[Fergus Ewing]

Motion agreed to.

I thank the cabinet secretary and the officials who attended for those agenda items.