My Lords, I have every sympathy with the noble Lord, Lord Jones, because I always go to the Explanatory Memorandum first. I congratulate colleagues and officials who have given us a comprehensive understanding of the background of these technical changes. In seeking to address these points, it is important to understand the context, which is that we are having to fine-tune systems that we are going to have across the UK in one way or another and it is very important that there is certainty. I understand this involves noble Lords, particularly the noble Baronesses on the Front Bench and some of my noble friends, in considerable scrutiny, but we must get this right. I was struck by the words of the noble Baroness, Lady Bakewell: “We must get this right”. That means that when we make typographical errors or whatever, they should be attended to as soon as possible.
I shall run through the commentary. My noble friend Lady McIntosh and the noble Baroness, Lady Bakewell, referred to the exchange rate matter. The 2018 exchange rate was used to convert euro amounts in the retained EU regulations into sterling amounts. This is a one-off amendment. In future, we will take licensed securities in sterling. There is therefore no reason to peg these figures to the euro exchange rate. As I say, this is a one-off amendment and the figures will now be dealt with in sterling.
My noble friend Lady McIntosh asked about cost recovery. We take securities in the area of import and export licences. The only payment required to obtain an import or export licence is a security which is taken and held by the RPA. The RPA releases the security when it receives proof that the obligations specified on the licence have been fulfilled. As a result, there is no cost to an operator who uses the licence as intended. I understood that anyway. My noble friend also spoke about export refunds. In line with our WTO obligations, we have committed to the phasing out of export refunds from 2020. The EU has not used export refunds for quite a number of years.
The noble Lord, Lord Jones, made a powerful speech. He is a champion of upland farmers across the kingdom, but particularly those in Wales. Having walked parts of Powys—the beacons—and Snowdonia in my time, I recognise the beauty of that landscape. Let us not forget why it is so glorious. It is because of that particular brand of pastoral farming, the custodianship of the upland farming community and the culture that goes with it. We should treasure that. That is why the noble Lord is right to refer to tourism. They are places people want to go to because of the culture that those great families have produced over the generations. I would be failing if I did not also mention the high-quality Welsh lamb and Welsh beef they have produced, as well as Anglesey sea salt. All these are products of which we should be proud.
It is not just the uplands of Wales. There are the lowlands as well, which my noble friend Lady Byford mentioned. Farming communities across this country
are essential not only because of their glorious food but because of what they do and will do as we take ourselves through the environmental enhancement. It is essential that we work collaboratively with the farming community. With over 70% of the land in the UK farmed, and the figure is probably much higher in Wales, this is the route by which environmental enhancement—habitat recovery, nature recovery and wildlife recovery—will happen.
On the question of devolution, agriculture is devolved. Yes, there are elements relating to Wales in the Agriculture Bill. I am looking forward very much to opportunities for further discussions, perhaps tomorrow but also on agriculture legislation. In championing devolution, I should say—and I am going on to talk about common frameworks, which are hugely important—that the Welsh Government launched their new consultation, Sustainable Farming and our Land, on 9 July, which will be open to responses until 30 October. In England there is the environmental land management proposal, as a way of recognising what farmers do by way of public benefits.
I turn to the issue of divergence, and I thank the noble Baronesses, Lady Bakewell and Lady Jones of Whitchurch. In respecting the areas of devolved competence, my feeling is that at both official and ministerial level there is a strong recognition of what I would call common sense prevailing. UK government officials have been working closely with officials from all devolved Administrations to design future common frameworks where they are necessary and desirable. The Scottish and Welsh Governments continue to commit not to diverge in ways that would cut across future frameworks where it is agreed that they are necessary, or indeed where discussions continue. And not forgetting Northern Ireland: the Government remain committed to restoring devolution in Northern Ireland, but also acknowledge the engagement that has continued with the Northern Ireland Civil Service on common frameworks.
I have here a note on the discussions. The Secretary of State and the Minister of State, Mr Eustice, meet Lesley Griffiths from Wales, with whom I have a good connection; they meet Fergus Ewing from Scotland, with whom I have worked on a number of issues; and of course they meet DAERA officials, who have been most helpful to all of our Lordships on the SIs relating to Northern Ireland. All the Administrations are taking the issue of divergence forward in a very sensible and professional way. We respect the devolution arrangements, but common sense clearly suggests that there are ways in which we can work forward to the common good for businesses, consumers and indeed well-being.
The noble Baroness, Lady Jones of Whitchurch, specifically mentioned Wales and the issue with certain elements of the statutory instruments. There are some circumstances where the mechanism does not apply to Wales. That is because certain provisions are specific to the Welsh devolution settlement. That said, the Welsh Government have carefully considered whether the Secretary of State should be able to act on their behalf in respect of each of the functions concerned, and the drafting reflects that. Again, certain elements of the settlement relating specifically to Wales mean that it will be bringing forward its own statutory
instruments, but that is within the mechanism of co-operation and understanding. To conclude on the divergence/common framework position, we are absolutely clear—if I might say this on behalf of all the devolved Administrations—that we are working together, I think successfully, at ministerial and official level because that absolutely makes common sense and is right for the United Kingdom.
The noble Baroness, Lady Bakewell, referred to poultry stakeholders. We have engaged with poultry breeders through the UK Livestock Brexit Group, which is made up of representatives from the livestock sector including the British Poultry Council, which itself represents all parts of the poultry sector—breeding, hatching, growing and processing. On amendments made to provisions concerning poultry and poultry meat, we have engaged with the British Poultry Council directly. The noble Baroness also referred to crisis payment examples. I must say that these have never been applied in the EU since the introduction of that provision in January 2014. There are no examples of such crises in EU law. I do not know whether that requires further consideration but my understanding is that there is no reference.
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My noble friend Lady Byford raised the issue of eggs. With regard to marketing standards, the SIs cover only eggs in the shell, not egg products. The SIs also confer on the Secretary of State the powers that the Commission currently has to make rules on the import of ovalbumin: the protein in the white part of the egg. I did that look up: it was very educational.
I have asked the same question as the noble Baroness, Lady Jones of Whitchurch, did about transitional periods: would it not have been a good idea if we had done that in the first place? The fact that I asked the same question might be the best way to reply to her: the point is very much taken. I hope that message goes across Whitehall. On her question about transitional periods and communication, importantly, the duration of the transitional periods has been communicated to stakeholders during our discussions and via the GOV.UK website, which is regularly reviewed and updated for obvious reasons. The noble Baroness also raised the issue of reciprocity. As noble Lords may be aware, the European Commission has published a notice in relation to EU food law and rules on quality schemes, stating that, subject to the conditions of a withdrawal agreement, the UK will be classified as a third country once we have left. This means that UK producers wishing to export goods to the EU will need to comply with the relevant EU rules and requirements on third-country imports.
For our part, we have determined that providing appropriate transitional periods will be the best way to ensure that UK businesses and consumers can still access products from the EU so as to maintain free and frictionless trade and to limit disruption to our businesses. I should also say, being the Biosecurity Minister, that we have taken the view that on day one, given the high standards that exist in the EU which we are already adopting, we are confident that that is a proportionate and correct approach to take in the early times after exit.
The noble Baroness, Lady Jones of Whitchurch, also asked about farm support. As she said, the Government have pledged the same cash in total in funds for farm support for the whole of the UK until the end of this Parliament. I am afraid that I do not know when the end of this Parliament will be. Perhaps I should bat the ball back to her and ask, “When will the leader of Her Majesty’s loyal Opposition take a view on this matter?”, because the real point that she rightly makes is that it is important that we have as much certainty as possible for the farming community.
As I have outlined to your Lordships, the farming community does a lot of things for this country. We will want it to do even more on the custodianship of the land and enhancing the environment, as well as, vitally, producing food for the nation and abroad. That is why we will work to provide that certainty through the agriculture Bill. That is why we have specifically stated the importance of having a transitional arrangement over seven years, with the reduction in direct payments and the trialling of environmental land management schemes, along with an improved Countryside Stewardship Scheme. This is all intended to work with the farming community to make sure that farmers have the right support not only in that regard but to improve productivity and to undertake research, such as that at Rothamsted, with which the noble Baroness is associated. It is essential that we have research and development into the challenges that this sector faces and the opportunities that this country can provide in producing food.
This regular dialogue with farming unions and interests is important because it is essential that they know the position. On continued support for Pillar 1 and Pillar 2, as I have said, no Parliament can bind its successors. I am not writing the noble Baroness’s party’s manifesto—or, indeed, my own party’s—but if there is a general election, my suggestion would clearly be that agriculture, the production of food and environmental enhancement will be extremely important.
I am nearly finished. The noble Baroness, Lady Bakewell, referred to pragmatic enforcement. During the transition period set out, producers will not suffer adverse consequences for their products on the UK market. When exporting products to the EU, businesses will need to abide by the relevant EU rules.
I will look at Hansard because there some other points may have been raised. I think I have covered everything, unless the noble Lord wanted me to emphasise something.