Official Report: Minutes of Evidence

The Chairperson (Mr Butler): I welcome the officials from the Department of Agriculture, Environment and Rural Affairs: John Terrington and Elaine McCrory. They will answer questions and discuss issues as we go along. As members will recall, we spent most of last week on clause 1. We started clause 2, and I propose that we start there now. If members are content, we can return to clause 1 once we have looked at the remaining clauses.

I would appreciate a short brief to get the ball rolling again.

Mr John Terrington (Department of Agriculture, Environment and Rural Affairs): Thank you for having us back.

We will kick off with clause 2, in which we find the powers for the Department to make regulations to modify the list of direct legislation that relates to the fruit and vegetable aid scheme (FVAS). It also includes an additional power to make more specific regulations about the review of decisions on support under the fruit and vegetable aid scheme, and that is important because the scheme is no longer mandatory. Regulations under that power will provide for appeals and decisions that the Department makes in line with the rules that are already in place for other support. It clarifies that any amendments using those powers can amend the changes that clause 1 makes to the common market organisation (CMO).

The Chairperson (Mr Butler): Thank you. We are looking at clause 2. Do members have any questions or queries they wish to seek assurance or further information on?

My question is slightly about clause 2 because that is where we start to look at the regulations that will supplement the legislation. Has there been any work or direction given in that space about what the regulations will look like?

Mr Terrington: I will start off, and Elaine will talk about the review. The powers are to amend the existing EU legislation. There are already limits on what can be done. It is about the things in the devolved space within those three pieces of legislation. To a degree, that limits how much detail we can look at.

Ms Elaine McCrory (Department of Agriculture, Environment and Rural Affairs): As part of the review, we look at the legislation because the first bit of the review looks at the process. The process covers the existing legislation and the rules and procedures that we have in place. We have had an initial look. We have not come to any conclusion, but we have gone through it and identified what could change, bearing in mind what stakeholders have been telling us as well.

This was an EU scheme. To some extent it was domesticated, if I can use that word, but it was domesticated only to make it work. It does not necessarily align with the Department's priorities or the Minister's priorities. There is scope to move things about. More specifically, as you will be aware, the legislation has not kept pace with the changes in the EU or the South of Ireland, and stakeholders are looking enviously at the changes that have been made elsewhere. For example, in the EU, you can have a seven-year programme; here, currently, you can have a three-year programme. They are also looking at the funding available: you can get 80% for research, development and innovation and environmental measures. Here, you still have 50%. There are things that we can look at and that we may want to shift.

With regard to administration, again, you will be familiar with EU legislation; it is clunky, detailed and sometimes very prescriptive, particularly around checks, for example. We might want to look at that to see whether it is really necessary to do 100% checks on every piece of paper associated with the programme. We might want to look at that.

There are opportunities to align with the good things that have happened elsewhere. There are opportunities to streamline the things that do not work for us and to make them better suited to our circumstances in Northern Ireland.

The Chairperson (Mr Butler): Obviously, if the legislation were to pass, it is unlikely to change. It will be in place for a while, but regulations are subject to affirmative resolution. Even though the word "modify" and the description of that would scare some of us because the powers are significant, it is subject to draft affirmative procedure, so the power lies with the Assembly. In the development of the regulations, is there any intent to consult beyond the Assembly and the Committee?

Mr Terrington: Normal policy development, from where we sit, would say, "Yes, that will go through". We will start with those who currently benefit from it. We will go wider — obviously, it is sitting here without clear sight, to be fair, but has the potential of amending something that might make it more attractive to other sectors, for example, so there would be, obviously, a need to consult them. However, the review has been an ongoing process. When it comes to making decisions about what might happen, those things will go back, and there will be a continuing narrative that has been ongoing for some time.

The Chairperson (Mr Butler): OK. Do any other members have any queries, particularly on clause 2?

Mr McAleer: Chair, just on the power to modify, does that relate specifically to the area that we have discussed previously?

The Chairperson (Mr Butler): It is littered throughout the clauses, to be fair.

Mr Terrington: The "modify" definition relates to the legislation on the fruit and veg aid scheme but also to clause 3 on information and promotions. The definition of "modify" applies to both, should we bring forward regulations in that space. Does that clarify it?

Mr McAleer: Yes.

The Chairperson (Mr Butler): Clause 2(1), gives the power that:

Can you clarify what legislation those powers will apply to? Is everything just within the FVAS? Are there no other, wider implications?

Mr Terrington: It should all be in there, but, given the nature of EU legislation, there may be a consequential somewhere else with regard to definitions or whatever. That is the reason for the consequential etc powers, but 99·9% of anything that is policy will be in those three pieces of legislation. [Inaudible.]

Mr Terrington: Yes. For the fruit and veg aid scheme and, as I say, the information provision somewhere else. Even in those three pieces of legislation, there is stuff that we could not amend using the powers, because they fall into the reserved sphere and would fall to the UK Government (UKG) — things around producer organisations, in particular, and the set-up and arrangements for that.

The Chairperson (Mr Butler): If members have no other points to make on clause 2, I will bring it to a conclusion. That was quicker than clause 1.

Any further information needed from the Department or further discussions can take place at the meeting next week. Some members who are not here at the moment are particularly interested too. It does not mean that you are off the hook on clause 2, by the way. We are not giving you the green light just yet.

Do you want to give us a brief overview of clause 3, which is on information provision and promotion measures and the power to modify?

Mr Terrington: It will be brief. Clause 3 also confers a power on the Department to make regulations to modify assimilated ex-EU law, this time in relation to legacy EU agri-food information and promotion schemes. Elaine, do you want to give a two-minute brief on what those schemes did? We have not really discussed that a lot with the Committee.

Ms McCrory: OK. I cannot find the page, so it will just come off the top of my head, as usual.

In the past, the Commission would run competitions that people would apply for to promote agri-food products. They were basically about raising awareness of products and trying to promote consumption of them. If there was a crisis, for example, it tried to raise consumption at those times to support producers and highlight the quality of EU products, how they were produced, their environmental credentials, the high animal welfare credentials and so on. There have been successful applications from Northern Ireland. The Dairy Council for Northern Ireland was particularly successful. It had programmes running from 2015 to 2017 and 2018 to 2020. Those were export promotions programmes in third countries, particularly in the last three years. Once EU funding ended, we funded the third year of those programmes. They were export campaigns in south-east Asia and the Middle East. That involved outward missions, where some of our dairy companies went with the Dairy Council to some of the big exhibitions. It also had visits inward, where buyers came to Northern Ireland and visited the College of Agriculture, Food and Rural Enterprise (CAFRE) to hear about the training on offer. They talked to our vets about the controls available and the production of products, and they got a good idea of the high-quality produce that we produce here.

In respect of what it delivered, we are looking at the post-project evaluation of that funding, and there was a favourable return on the money that was invested. The Dairy Council estimates that, over the two sets of programmes from 2015 to 2020, it generated about £50 million in sales for the Northern Ireland dairy industry. It was quite a successful programme.

As we are developing a new policy in Northern Ireland, moving away from the common agricultural policy (CAP) legislation, there is an opportunity for us to look at what the Department wants to do in respect of food. You will be familiar with the food strategy framework agreed by the Executive. Under that, we are looking to see where food promotion fits in. We also have domestic food promotion programmes, such as the regional food programme, that folks will be familiar with. It has funded the likes of Food NI to undertake campaigns.

We need to consider whether the EU legislation that is in assimilated law is the way forward or whether it would be better to do something different using domestic powers. A review of that is ongoing as well, but it is at an earlier stage than our review of fruit and veg aid.

That is an overview. Do you want to ask something specific?

The Chairperson (Mr Butler): That is fine. The food strategy is rattling around in my head because I can see that there is a direct link. We agreed the strategy's overarching intent and that the Minister should go ahead with it, but we still have to have sight of the action plan.

From my perspective, there is the potential for clause 2 and clause 3, in particular, either to be a good fit that can be exploited or to have unintended consequences, because the legislation does not necessarily fit with the flexibility required to react to global pressures. The food industry faces global pressures that it has not seen for some time or that may not have existed before. That is not a criticism, by the way. Does clause 3 mean that we may be more flexible and agile in reacting to those pressures? I may be asking an obtuse question, but I see the implications of making changes, whether we are exporting to GB or the EU. We have had previous discussions on information on packaging and all of that. Does clause 3 assist with that? Does it help, or will there be an unintended consequence?

Mr Terrington: If the fruit and veg aid scheme is potentially a clunky and very EU scheme, I imagine that this will be as well, by its nature, in requiring an application from various member states or organisations within member states. Its immediate flexibility will not be particularly great. That is why we have taken powers. However, given that it has been successful, having it on the statute book might answer any need rather than having to look for additional primary powers. Having it on the statute book is certainly more flexible than not having it. As Elaine said, we use and have used other powers in parallel to this. If, in future policy, we want to do x or y against the background of global pressures, it will come down to saying, "Let us see what powers we have". That is always the first way to do it. The powers are the EU powers, and this power provides us with a chance to streamline legislation and make it more Northern Ireland-friendly. In other words, yes and no. I am hedging my bets a bit.

Ms McCrory: We are not that far advanced in considering what we might do with the legislation. Our first move was to make sure that we preserved it. Other parts of the UK got rid of it, but we said, "No, no. Hang on a minute. In the absence of Ministers, we should not do that. We need to take stock, see what we want to do in the future and see what powers we need to do that. Do not throw out powers that you have."

Mr Terrington: To some extent, the need to do the rest of the Bill for the fruit and veg aid scheme presented the opportunity to do this now. Who knows when the opportunity to legislate for more primary powers will come about? On the basis that there was a gap and we did not have those powers, this was the time to do it.

The Chairperson (Mr Butler): OK. I am content with the questions that I have asked. If members have no other questions, I will bring the discussion of clause 3 to a conclusion. If we need any further information from the Department, we will write to you. Some members are not here, so further discussion can take place at our meeting next week, if members are content.

We will look at clause 4 on regulations. The majority of respondents were opposed to clause 4, as they were to clause 3. One respondent was in favour of it but only on condition that the detail of the replacement scheme to which the provisions apply be made known. Will you give us a bit of briefing on that?

Mr Terrington: Clause 4(1) provides details of the regulation-making powers in clauses 2 and 3. It provides that such regulations can make:

That is a standard provision to allow for changes to other legislation in order to ensure a fully functioning statute book following amendments that might be made using the powers under clause 2 and clause 3. As I said when we talked about clause 2, that is important, given the complex and interwoven nature of EU law. It also provides for consequential changes to be made to any statutory provision, which, when read with the interpretation in clause 5, can include primary legislation. Again, that is a narrow power that, we believe, is standard in order to ensure a fully functioning statute book and no unseen consequences.

Finally, clause 4 provides that regulations made under the Bill can be made only with the Assembly's approval, as the Chairman said, by way of the draft affirmative procedure.

The Chairperson (Mr Butler): I have one question that is more to do with the definition and, at the earliest point, recognising who decides what "incidental", "consequential", "transitional" or "transitory" mean. What does the bar look like for that, and who determines it?

Mr Terrington: They are legal terms. They would be included and would be subject to legal challenge if they went beyond that. I would like to think that, in the Assembly's draft affirmative procedure, in the time for it to be considered, if anything was felt to be ultra vires, that would be brought to our attention. It is a pretty tight clause. I would love to sit here and give examples, but it is technical, so, even if I could, I do not know whether that would be any help.

The Chairperson (Mr Butler): No problem. The reasonable fear is, probably, that some of the smaller businesses that may have applied may feel that, traditionally, larger businesses have had better access. I am not sure that clause 4 is particularly the point where that would hit them.

Ms McCrory: I will pick up on that point. I would not say that fruit and veg aid benefits only larger companies. We tend to find that a mixture of companies come together in a producer organisation (PO). There are smaller companies, medium-sized companies and larger companies. One of the advantages of the PO is that the smaller companies get a good share of the available funding. They are also able to learn from the medium-sized and larger companies in the PO. I would not say that it is just big companies that get fruit and veg aid.

Mr Terrington: If the content of the main statutory rule (SR) — the main policy change that is being made using the enabling powers — has contented the industry, I genuinely think that producers will see nothing consequential. It is pretty obvious that there is a transitional impact, in that anything that we do in future will not affect something that has already been agreed; it is that kind of language. You would be discussing those matters in terms of practicalities if there were any impact, but, as I said, I suspect that there will be mostly consequential changes in terms of potential definitions and things like that that are buried elsewhere in legislation. You need to make sure that those have no unintended consequences and that you do not have a piece of statute that does not entirely make sense.

Ms McCrory: If you look at the regulations that we are talking about here — fruit and veg aid and information and promotions — they are interlinked as well. You will find references to one in the other. You need to be sure to pick up on things like that. If you make a change in one place, you have to make sure that you follow that through to somewhere else.

The Chairperson (Mr Butler): OK. Thank you for that.

Are there any other questions or queries on clause 4, members? No. OK, we will bring clause 4 to a conclusion. If any further information is needed, we will contact the Department in writing, if that is OK. Any further discussion can take place at our next meeting with other members.

We are now going to look at clause 5. Again, the majority of respondents were opposed to the clause. Among the comments were the contention that the term "modify" is too broadly defined. You may wish to speak to that. Another respondent said:

I am content for you to pick anything out in relation to clause 5 that we have not already touched on.

Mr Terrington: Clause 5 provides for the interpretation of terms used in the Bill, including that "modify" includes to amend, repeal or revoke. Again, our understanding is that those are standard provisions that allow for changes in whole or in part to the legislation in question. That is important, because it ensures that, if a new scheme or some alternative is developed, you have the opportunity to make sure that the statute book reflects that. The clause also defines what is meant by "statutory provision" in clause 4.

In response to the stakeholder comments that you reflected, I do not think that it is that broad; it is standard. It is subject to the draft affirmative resolution procedure, as stated in clause 4, and that is there to give reassurance that the Department will do nothing that the Assembly does not like.

The Chairperson (Mr Butler): I probably should have tackled this question earlier and asked it in a more succinct manner. The term "modify" in this instance has not been modified to suit the Bill. It is a standard application in the legal context, of "modify". Were any words other than "modify" or any other routes considered?

Mr Terrington: I do not think so. In discussions with the drafters, we said what we needed to do and what it was for, and that is what they drafted. It is pretty consistent with —.

Ms McCrory: There is a similar definition in the Scottish agriculture Act.

The Chairperson (Mr Butler): That is fine. Thank you. That sorts that out for me.

As members have no other questions, I will bring the discussion on clause 5 to a conclusion. If we require any further information, we will contact you. Other members who are not here may be interested in that. We may get you back, if that is OK.

We will now look at clause 6, which deals with commencement and the short title. I do not think that too much information will be required on that. Do you want to say anything?

Mr Terrington: For the record, it is another technical clause and provides for the Act to come into operation on the day after Royal Assent. Given the transitional provision in clause 1, it will have no effect on current operational programmes. It then sets out that the short title is the "Agriculture Act". I know that we discussed that a few weeks back.

The Chairperson (Mr Butler): It is a conversation that we have had a few times. This is not a poke at you, but Bills should do what they say on the tin, even just for research purposes. I regret that it is called the "Agriculture Bill".

Mr Terrington: You asked what other words were used. At the time of drafting, we saw the Bill as a potential amendment to the Agriculture Act 2020 in that it would be appended to the existing powers that we have to change the other CAP schemes, and we thought that that was a good way of doing it. The advice at the time was that this is far more open, clear and transparent for all stakeholders to see, so that is why we ended up where we are.

The Chairperson (Mr Butler): OK. I appreciate that.

As members have no other points to raise, I will bring the discussion on clause 6 to a conclusion. However, if any further information is required, we reserve the right to either write to you or ask you to come back, if that is OK. The Committee will have further discussions at its next meeting.

Thank you so much for your time.