Plant Health (Import Inspection Fees) (Scotland) Amendment (No 2) Regulations 2024 [Draft]
We move to consideration of an affirmative Scottish statutory instrument. I welcome Jim Fairlie, the Minister for Agriculture and Connectivity. I also welcome his officials, John Speirs, who is the senior policy adviser, science and advice for the Scottish agriculture policy and pesticide survey unit, and David Corrigall, who is a solicitor.
I invite the minister to make a short opening statement.
Thank you for making time to consider this draft SSI. As the committee will note, this is a very brief SSI, which makes changes to two dates that relate to plant health import inspection fees.
It extends until 1 July 2025 the end date for easements regarding the introduction of fees in relation to official checks on medium-risk fruit and vegetable goods being imported into Scotland from the EU, Liechtenstein and Switzerland. It does the same for fees in relation to plant health checks on goods arriving into Scotland from the EU, Liechtenstein and Switzerland via the west coast ports.
By way of context for the changes, I draw the committee’s attention to the UK statutory instrument, the Official Controls (Extension of Transitional Periods) and Plant Health (Frequency of Checks) (Miscellaneous Amendment) Regulations 2024.
Convener, I wrote to you on 29 August to seek the approval of the Scottish Parliament of proposals by the Scottish ministers to consent to the making of that UK secondary legislation affecting devolved areas, and I thank the committee in advance for its consideration. The SSI before the committee represents consequential changes that are required due to proposals that are set out in the linked UK statutory instrument.
The changes that are proposed to the dates on a Great Britain-wide basis by the UK SI and, through the SSI that is before the committee today, to the application of the related fees in Scotland are as follows. The UK SI makes changes in relation to annex 6 of the EU official controls regulation by extending, from 31 October 2024 to 1 July 2025, the period under which plants and plant products from the EU, Liechtenstein and Switzerland entering GB through a west coast port are not subject to controls. That helps to address the lack of clarity from the UK Government on the timeline for the implementation of checks on goods entering via west coast ports, which the cabinet secretary and I discussed with the committee at its meeting on 11 September. We remain concerned that the UK Government has yet to communicate clearly to the industry the timescales for the introduction of the range of checks at west coast ports and the complex issues that need to be resolved before that can happen.
Similarly, the UK SI extends to 1 July 2025 the period during which certain EU medium-risk fruit and vegetables are not subject to certain import controls. A statement was issued to the industry by the UK Government on 13 September, setting out the extension, from January 2025 to 1 July 2025, of the easement of import checks on medium-risk fruit and vegetables imported from the EU.
That clarity is welcome, and it is long overdue. As I said to the committee on 11 September, we are trying to reset the relationship between the UK and the devolved Governments. I hope that the clarity on dates that is provided through the linked SI represents a new beginning in that regard.
I ask the committee to support the SSI to ensure that the relevant plant health import inspection fees for Scotland are aligned to the revised dates. I consider the regulations to be necessary and appropriate. My officials and I are happy to take questions from the committee.
Thank you, minister. Are there any questions?
The regulations were welcomed by the cross-party group on gardening and horticulture. That is correct, is it not, Ms Hamilton?
Yes.
Concern about those charges was raised at a meeting of that group, so we very much welcome the instrument.
We move to agenda item 3, which is the formal consideration of the motion to approve the instrument. I invite the minister to move the motion.
Motion moved,
That the Rural Affairs and Islands Committee recommends that the Plant Health (Import Inspection Fees) (Scotland) Amendment (No. 2) Regulations 2024 [draft] be approved.—[Jim Fairlie]
Motion agreed to.
Is the committee content to delegate authority to me to sign off a report on the instrument?
Members indicated agreement.
That completes our consideration of the instrument. I will pause briefly to allow for a changeover of witnesses.
Rural Development (Continuation of Operation) (Miscellaneous Amendment) (Scotland) Regulations 2024 [Draft]
Item 4 is consideration of another affirmative SSI. I note that the Scottish Government has issued a correction slip for the explanatory note that accompanies the instrument. I welcome back to the meeting Jim Fairlie, the Minister for Agriculture and Connectivity. I also welcome his officials, James Muldoon, who is the head of the agriculture support policy development unit, and Lewis Kerr, who is a solicitor.
I invite the minister to make some brief opening remarks.
It is almost as though I never left.
Thank you for considering this draft SSI. The 2024 regulations use the powers of the Agriculture (Retained EU Law and Data) (Scotland) Act 2020 to enable the Scottish rural development programme—SRDP—and rural support generally to continue to operate under assimilated law from 2025 to 2030. That is required as the current rural development schemes would otherwise end in 2024.
12:15Our published agricultural reform route map sets out the timescale for a phased transition from legacy common agricultural policy—CAP—schemes into our new, co-developed four-tier framework. Extending the SRDP will deliver that policy, ensure that there are no cliff edges in support and ensure a just transition.
Existing reporting requirements are extended for a year to ensure that there is no gap before the Agricultural and Rural Communities (Scotland) Act 2024 requirements are in force. The approach that we have taken to that extension is consistent with the previous use of the 2020 act powers to extend the SRDP.
Good morning, Mr Fairlie. Did the Scottish Government consult on the regulations? If not, why not?
No, we did not.
Do you want to answer the full question, James?
In the co-development that is going on through the agriculture reform programme in relation to the route map and phased transition, we sit around the table with NFU Scotland and multiple other partners. The agriculture reform implementation oversight board—ARIOB—is one example of that. The regulations are part of the continuing work to keep the present machine on while that transition happens. All partners have been involved in discussions to flesh out the route map and what happens in it.
Yes, but the committee does not have access to what has been said and fed back in the ARIOB, so we have no idea about what the feedback is in that co-development, which leaves our scrutiny of the SSI to a wing and a prayer, really.
I cannot see how the co-design argument can be used in this case, because it seems as though the Scottish Government is relying on the previous consultation. My question is to Jim Fairlie. Have you read the previous consultation responses?
The SSI does not change policy. All it is trying to do is allow us to continue to make payments beyond the current period to 2030. There is nothing hidden in it and nothing that has not been considered by the full industry. It is just to allow us to, as James Muldoon said, keep the machine running so that we can continue to make the payments until 2030.
I understand that. Avoiding cliff edges is incredibly important, but have you read the previous consultation responses?
No, I have not.
We are being asked to scrutinise the SSI using the previous consultation responses. Having not read the previous consultation, do you still trust the evidence?
I absolutely trust the process that the Government has gone through in complete collaboration with the industry, including the NFUS, which is more than happy for the SSI to be passed because it will allow the Government to continue to make payments. Genuinely, I do not understand where the concern is. The SSI will allow us to keep the machine on and to continue to make payments as we go through the transitional period. Otherwise, payments will stop at the end of this year and we will have a dead end, which nobody wants. I am sure that nobody on the committee wants it.
Why have you left it to the last minute?
Why have I left what to the last minute?
Why have you left it to the last minute to lay the regulations before the Parliament if there was no consultation?
It has not been left to the last minute. We have laid them at the appropriate time.
There is a deadline and we have not been able to scrutinise the effect of the SSI. We have no idea what the NFUS has said about it. In the past, there has been concern around rebasing the LFASS—I will call it that.
If you do not mind, Christine, that is the less favoured area support scheme.
Oh, that was patronising.
Well, you asked what the previous acronym stood for.
I knew what this one was, though.
Okay—sorry about that, Christine. I was just being clear.
There has not been a consultation to allow stakeholders to give their views. The Government is leaving it to secondary legislation, which is being based on feedback from the ARIOB to which we are not party. It is important that people other than those in the NFUS are able to have a say in how the Government delivers the £65 million.
We also do not know whether the payments will continue to total £65.5 million in the 2025-26 budget. There needs to be consideration of whether the Scottish Government will continue with LFASS payments beyond 2030, because the EU has discontinued them and moved on to something entirely different, and the SNP Government’s policy is to align with Europe. The committee would like to know what the future holds, because it is not long until 2030. The minister is asking us to ensure that the payments continue, but how are we to know what farmers in general think about the current payments for active farmers?
For example, the LFASS rules say that active farmers would usually own stock, but we know that stock levels, including livestock, are contracting across Scotland, which is a concern. There are young people who want to get into farming, and there is a concern that those who are not necessarily actively farming livestock are unable to access LFASS. We should be supporting young people who are coming through the system to ensure that farming in Scotland has a successful and prosperous future.
Okay. Your point is? I am asking you to clarify—
I am sorry, minister, but that is incredibly rude.
I do not think that it is rude at all.
No, it is rude.
I am asking you—
I have just made my point to you very succinctly.
I am still not clear what the question is.
I remind Ms Hamilton and the minister of the necessity of treating one another with respect. I ask for one person to speak at a time.
I am still not sure what the point of the question is. The SSI will merely allow the Government to continue to make payments up until 2030. The committee is well aware that there is a route map and that the LFASS arrangements are being discussed with the ARIOB. As far as I know, the committee is well aware that the NFUS has said that it is comfortable with the SSI. We know that LFASS is being reviewed, but the SSI will simply allow the Government to continue to make the payments in whatever form they happen to be made. There will be far more opportunities for the Parliament and the committee to review what is proposed. The SSI is purely the mechanism to allow us to continue to make payments, in whatever shape or form, as we go from here.
If we do not act, the payments will stop at the end of the year, so we want to ensure that there is a mechanism for continuing to pay farmers. It is that simple. I do not understand what I am being asked to do at this point.
I have taken from that that the Scottish Government is recycling its old homework instead of conducting fresh research to inform the SSI on continuing payments. I will leave it there.
I have a list of members who want to come in—I have registered the interest of all of them.
Good afternoon, minister. Thank you for joining us.
I want to clear something up on reporting. The policy note states that there will be a requirement for an annual implementation report on the old Scottish rural development programme schemes only in 2025 and that, thereafter, any reporting will be wrapped up in the rural support plan provisions that are set in the legislation.
My understanding is that we will not have a rural support plan until the autumn or winter of 2025, and that reporting on that will be required at the end of each five-year period. That means that we will not have that reporting until at least 2030. Is there no requirement for reporting on any scheme that will continue in the interim, such as LFASS or the agri-environment climate scheme? If so, why is that? Should there not be on-going reporting?
There will be on-going reporting. This particular reporting year is being rolled into the requirement under the 2024 act. As that comes into effect, there will be further reporting. I will let James Muldoon clarify the detail of that, because he has far more understanding of it.
As I believe we spoke about in previous committee sessions, a monitoring and evaluation programme is required in relation to the rural support plan under the 2024 act. That will be a better vehicle for assessing the impact of the schemes and domestic outcomes, whereas the current model of reporting fits only with the EU CAP outcomes as they were set in the last period.
We discussed in previous committee sessions how the monitoring and evaluation for the rural support plan will report on the schemes in a way that is appropriate to the support mechanisms. Naturally, our budgeting will be reported annually, but scheme outcomes might be reported annually or on a two-year or three-year basis, depending on what they do.
The purpose of extending the reporting requirements through the powers for only one year is to allow the reporting to be subsumed into that more appropriate monitoring and evaluation programme, which will naturally be public, as we will make sure that we share the information. We need to show that we are spending public money as efficiently and effectively as possible, so we will certainly want to know how that is going.
Thanks for that, but the reporting is connected to the rural support plan and we will not get that until the autumn or winter of 2025. The requirement is for reporting at the end of each five-year plan period. Does that not mean that we will have all the schemes but we will not see regular reporting?
Not at all, Ms Burgess. We will do the reporting, as I said, per the different support mechanisms. It might make sense to do a more fulsome report at the end of a five-year plan period, but we want to know the impacts and effectiveness of the different support mechanisms, so regular reporting will be done support mechanism by support mechanism, as is appropriate to understand the impact thereof.
Okay—thank you.
Our committee papers say:
“The policy note states the extension of SRDP would allow for a phased transition away from the SRDP over the coming years as post-Brexit Scottish agricultural policy comes into effect.”
Minister, you said that this will take us up to 2030. I am thinking about Rachael Hamilton’s comments about active farmers and attracting young farmers and new entrants by supporting them in our less favoured areas, including in my patch in south-west Scotland. At present, Government resources are involved in the work on future policy and active planning. Will the policy remain as it is up to 2030? Is there an opportunity to alter the proposals and allow the rebasing and retargeting of support to continue to support active farmers and, in particular, new entrant farmers?
The policy will change and develop as we go along. The SSI purely provides the mechanism to continue the payments, whatever they will look like. Whatever the scheme will look like—I am not going to say anything about that on the record in case people expect that to become the scheme—we are absolutely committed to continuing to support LFASS. I do not say that on the basis of the programme; I am purely talking about the principle behind it. Whatever the scheme looks like, the SSI will allow us to continue to make the payments.
Emma Harper and Rachael Hamilton have both mentioned new entrants. I think that I have said to the committee before that I am absolutely committed to ensuring that we do as much as we can to get new entrants into farming. I was desperately trying to do that myself, so I know the barriers to it.
As a result, the programme for government asks public bodies with public land to look at how they allow new entrants to get on to that land. This is purely the start of that process. I do not know what the scheme will look like, but we are in the early stages of saying how we will get young folk and new entrants into the industry and how we will support them as we move forward.
12:30
The SSI is about providing on-going stability and certainty up to 2030 while other programmes are being developed.
Yes. It is purely the mechanism that will allow us to continue to make the payments. The programme—whatever it looks like—will develop as we go along.
Thanks.
Before we go any further, I think that we need to put the discussion into context. The Delegated Powers and Law Reform Committee has suggested that
“under regulation 2(4) the instrument keeps the rate of payments under the Less Favoured Area Support Scheme at the current rate (which is the rate that applied in 2018) until 2030.”
Is that the case or not, minister?
I will hand over to James Muldoon to answer that question.
The LFASS payment rate was previously set in regulation, and the model advised by our lawyers was simply to keep things as they were. We have to be aware—we have to advise ministers on this, of course—that, if budgetary arrangements change and there is still uncertainty about what will be coming from the UK Government, further advice and further changes to the rate might be required, if budgets do not allow for it.
Just to get this on the record—this is a question for you, minister—do you agree with the DPLR Committee that the instrument keeps the rate of payment the same as that applied in 2018? Is that your understanding?
My understanding is that that is where we are at the moment, but, as James Muldoon said, that will be determined by—
But that is what we are deciding today.
Yes.
Thank you.
I just want to dig into that a little more. The regulations, in effect, freeze the way in which everything operates at the moment. Is the minister saying that, between the introduction of the SSI and 2030, he will be open to making changes to the scheme? After all, we have heard the arguments about rebasing and encouraging new entrants. Could further regulations be brought to the committee?
Regulations are highly likely to be brought to the committee as the scheme develops.
What would be the timescales for consultation and for giving us an opportunity to scrutinise such changes?
That would be done through the regular process of how such things happen. We have an ARIOB meeting tomorrow, and there will be more discussions about what this and LFA payments might look like. As all of that is developed, we will go through the normal process, and those regulations will be brought back to the committee.
It feels as though we are taking a lot on faith if we agree right now to freeze things up until 2030, when LFASS is already based on historical data. We have all been contacted by people who are concerned about that. Although I appreciate the need to avoid a cliff edge, we need a bit more clarity about what the options on the table are and how we can influence and scrutinise things.
We can write to the committee with further details as we go along, if that would help.
Would it be possible for us to get a bit more information and to consider the SSI at a future meeting instead?
No, we kind of need to get this done.
That is a decision for the committee, not the minister, but thank you for putting that on the record.
I am talking about the cliff edge and decisions needing to be made by a certain point. If the committee wants a bit more information, will that cause an issue with payments?
I will let James Muldoon clarify that point.
I hope that I will not reiterate too much of what the minister has said.
The SSI is about keeping the LFASS machine, so to speak, as it is and paying money on this basis. In relation to future less favoured area support or area of natural constraint support, at last year’s NFUS conference, the former First Minister committed to the future model of support being housed in tier 2 of the future support framework. Work is on-going with partners on that, and there is a public commitment from Scottish ministers that the form of support will allow active farmers to be supported in their activities in areas of natural constraint.
How we work that out comes back to our commitment to co-development and to working with partners, but the SSI is purely about keeping the existing mechanism going while that co-development work continues, enacted—subject to all being happy, of course—through the Agriculture and Rural Communities (Scotland) Act 2024 as we transition to a support mechanism.
Okay. I can probably say no more than I did in my previous question with regard to our needing to be able to scrutinise what is going on and what the options are. From the Government’s point of view, does a decision on the SSI require to be made today?
The SSI is required to keep the payment machine going just now. The future LFA model—the ANC model—will, of course, be set out in secondary legislation that will come to the committee.
We need to be completely certain about that. Ms Roddick’s question was whether there needs to be a decision today. Can you answer that?
It depends on parliamentary timetables thereafter.
That is incredibly important, but I can tell you that there does not need to be a decision today. There is flexibility—there will be no cliff edge if we do not make a decision today.
I beg your pardon, Emma. Would you like to come back in?
I think that I have asked everything that I can ask.
I am learning as we go along, but I want to highlight one key thing—only one. I understand that this is an interim measure and that the aim is to keep policies as they are—blah-di-blah-di-blah—but I note that, as the convener has pointed out, the DPLR Committee has said:
“under regulation 2(4) the instrument keeps the rate of payments under the Less Favoured Area Support Scheme at the current rate (which is the rate ... in 2018)”.
According to the report, the instrument will keep payments at that rate for the next 12 years. That is the first thing.
Secondly, as I say, I am new to this game, but the word “interim” does not usually mean that it will take six years to get something sorted out. I understand that farming is a long-term thing, but we are talking about an interim measure lasting for six years. I want clarity on what is being said.
The DPLR Committee report also talks about
“the current rate (which is the rate that applied in 2018) until 2030.”
In other words, there is a line in the sand at 2030. Are you saying, minister, that this interim measure could finish in 2027, or is 2030 the deadline? Is that the date that will be kept?
Therefore, there are actually three points that I want to make: one about the level of payments; one about the fact that, although we are talking about a date that is six years away, this is still called an interim measure; and one about the fact that 2030 seems to be the actual date—it does not say “up to 2030” or “no later than 2030”; it is 2030.
The quantum of the SRDP funding will stay the same. At this moment in time—
I know that.
—the quantum will stay the same.
I am talking about the level of funding.
That is what I am talking about, too. That level will stay the same as it stands.
For 12 years.
Yes, as it stands.
Minister, in your previous response, you said that that could change, depending on the UK budget.
That is exactly the position that we are in.
But this is law. This regulation says that payments will stay at the current rate—the one that applied in 2018. The legislation will say that. I do not think that you can just say, “Well, if we get more money, we’ll not actually do that. We’ll change the date.” It will be in black and white.
If the quantum has to change, we will have to change it, but we will not know that until we have certainty about the UK funding that comes to the Scottish Government.
So, there will be another regulation that says, “Well, it will not be the rate that was applied in 2018; it will be the rate that applies in 2024.”
There might well be, if that is what happens, but we will not know that until we have certainty from the UK Government.
I understand the point about budgets, but I am talking about legislation. If you put something in black and white that says, “The rate is going to be what it was in 2018”, that rate will have to be applied. Would other regulations be needed to change the rate? I do not know. That is all that I am asking.
CAP rates are set in legislation. We are dealing with the legacy of the CAP, which is why the rates are in legislation.
I do not understand this. If somebody says to me—
I will let James Muldoon try to make things clearer.
If somebody says to me, “Ms Grahame, I am going to pay you such and such at the 2018 amount and the interim position is that that will be fixed for 12 years”, that is the position. You are saying to me that, if the Government gets more money, people might get more than that, but that is not what the law will say. The law will say that it should be 2018 rates.
I will let James Muldoon try to clarify things better than I have been able to do.
Please.
Our CAP legacy system is designed for a multiyear EU funding window. We are now applying year-to-year budgeting to that system, and it is not designed for that. That means that our CAP legacy payment rates, whether they be for the basic payment scheme or LFASS, which is what we are talking about in this instance, are set in regulations so that the administrative schemes can then get the money out to eligible farmers and crofters.
When it comes to LFASS, we are required to set in regulation what the payment rate will be—
At 2018 rates.
Indeed. However, we have to remember that the agriculture budget is ring fenced from the UK and is based on land rather than population. If budgeting realities changed and the quantum that we received changed, with the advice to ministers being that the money could not be spread as it had been, a further regulation would, of course, be needed to change the rate. Just now, for the administrative systems, we have to set the rates in regulation to allow the money to flow.
I think that I am right, then. There would have to be another regulation to change the rate.
Yes.
That is all that I wanted to know.
I had another question. Why does it take six years?
It will not necessarily take six years. It is like a safety net to give us enough time if we have problems. Again, that does not need to be set in stone. The regulations have been laid, but we can change things as we go along.
So
“at the current rate ... until 2030”
should probably say “at the current rate”—whatever that rate is—“not beyond 2030” or something like that, because you are saying that the rate could be changed earlier. The report made me think that the rate would stay the same until 2030, but it could be changed earlier. Is that correct?
It could be changed earlier, yes.
Am I being pernickety again by saying that it should say “not beyond 2030” or whatever other language? [Interruption.]
Oh, a lawyer is coming in. I am in trouble now.
Is the specific text that you are referring to in the policy note?
Yes. I have both in front of me. Is the exact wording in the regulations “until 2030”?
I am sorry, but I am not entirely sure where you are pointing to.
It is the wording from the DPLR Committee’s report.
Yes. That is what I am reading.
Ah. I do not have that report to hand.
All that concerns me is providing clarity. If the minister is saying that the rate could be changed earlier, perhaps there should be a different phrase before “2030”—perhaps “not beyond” or whatever. I do not know. I just raise that as a concern.
The question is: why should the date be 2030? If we assume that there will be some changes to the rate, why should it not be 2025 or 2026? Why should it be 2030 at the 2018 rates?
Basically, that gives us time. I am fairly sure that we do not anticipate that the regulations will last until 2030, but they give us time so that we do not have to come back in 18 months or in two years to do this all again.
But that is not unusual. The first SSI that was dealt with today looks to extend the time, but not to some time far in the future. It covers a realistic time in which some issues can be resolved. We see that regularly. Minister, you will be well aware of the number of times that we have dealt with SSIs relating to extending border control legislation. Those covered not years but a matter of months, which is a reasonable time for these things to be resolved. That is one of my concerns.
I will bring Emma Harper back in.
12:45
I am seeking assurances on how you will give farmers the confidence that the SSI will not fail to support less favoured areas and new entrant farmers. How can we convey that the Government’s interest is in continuity, stability and certainty—all the words that we have been hearing—to deal with the Brexit cliff edge? What is the best way to convey to farmers that the regulations will just continue the current situation so that there is no cliff edge?
Well, all that I can tell you is that, for as long as I am the minister, I will be absolutely committed to ensuring that we allow farmers to farm in less favoured areas. I am well aware of what that feels and looks like.
The purpose of the SSI is not to be duplicitous or to hide anything. It merely gives us the ability to continue to make payments under this particular programme up until 2030, but the likelihood is that things will change as the policy develops in conjunction with full consultation with the industry. That is all that I can say. I cannot give any more of a guarantee than that.
Thank you.
James Muldoon, could you or the minister run through what you said about how the future of LFASS or any replacement scheme will be shaped by stakeholders?
We will be at the ARIOB meeting tomorrow and LFASS is on the agenda. We will be discussing what the early iterations of that look like. Is that on the agenda tomorrow?
I am not sure whether it is. I will have to double check.
I could be wrong in saying this, and I will correct the record if that is the case, but I think that there will be some scrutiny of LFASS at the ARIOB tomorrow. It is in the on-going programme for developing the future LFASS payments—I am calling it LFASS purely so that we all understand what we are talking about—and deciding what they will look like and how they will be delivered in the coming years.
As I have just said to Emma Harper, we are absolutely committed to making sure that the policy intent behind LFASS continues to be to make sure that we stop rural depopulation and that we have active farmers working in more disadvantaged areas so that that key element of our more remote—I hate to use the word “remote”—areas is properly supported. That is its whole purpose.
What mechanism will the feedback from the ARIOB meeting be put through? Will it be used through the rural support plan?
What do you mean by where it will be used?
Will the feedback from the ARIOB meeting shape the rural support plan?
It is part of the process of developing the policy, as we go forward.
The Agriculture and Rural Communities (Scotland) Act 2024 is a framework act and the SSIs are subject to the negative procedure, though. The regulations that are before us are subject to affirmative procedure. The DPLR Committee warned of the Government using Henry VIII powers: this is an example of that, is it not?
No, I do not believe that it is.
Can you explain why?
The whole policy has been developed in conjunction with the industry—not just the NFUS, but the Crofters Commission, too. Everybody who was involved in development of the policy was sitting around the table. As we bring regulations out, the committee will be able to scrutinise them.
We are not able to scrutinise the regulations wholly and fully right now, in my opinion. We are being expected to make our decision on a wing and a prayer. Unfortunately, I do not feel comfortable with that.
I can clarify one point. As we have said, we are talking about the present LFASS mechanism. On the future mechanism that you are asking about, the cabinet secretary lodged an amendment at stage 3 of the bill to put a duty on Scottish ministers to include, in the rural support plan, who we have spoken to and their thoughts on each support mechanism. The rural support plan will, of course, include a full articulation of the policy development rationale, who has been spoken to and what their views were.
Will any forthcoming decisions be subject to the negative procedure?
Lewis Kerr might correct me, but I am fairly sure that affirmative procedures apply to the first use of powers under the 2024 act.
I would have to go away and look at that. I do not have that information with me.
Reporting on legacy CAP schemes is a requirement of the rural support plan, but that uses negative procedure.
That is for future iterations rather than this—
But we are talking about the future. We are going round in circles. The rural support plan will be published in 2025, but we are being asked to continue this scheme until 2030.
I do not know how else to put this. You are not being asked today to support the policy that will be developed through ARIOB. All that you are being asked to support today is the mechanism to allow the payments to be made as and when that policy is developed. If, at a later date, we propose a policy that the committee does not like, it will be able to say no to it. For whatever is proposed, the committee will be able to say no, yes or whatever the decision is.
The SSI purely provides the mechanism to allow payments to be made: that is it.
Mr Fairlie, future SSIs will be subject to the negative procedure.
That is not what today is about.
I know, but you are trying to tie that in with—
No, I am not. I am genuinely trying to keep the focus on what it is that we are looking at right now.
I have no further questions.
I understand that this is an interim measure and that the regulations are about providing certainty for the time being until we get to where we want to be, now that we are not in the European Union.
However, I have looked at the regulations, and regulation 2 includes a list. It states:
“‘Scheme 2025 payment’ means the sum to which the applicant is entitled in respect of the period from 1st January 2025 to 31st December 2025”.
I will skip the others, but it then states:
“‘Scheme 2029 payment’ means the sum to which the applicant is entitled in respect of the period from 1st January 2029 to 31st December 2029”.
It then says the same for the scheme 2030 payment. Therefore, in relation to management of the payments, the system is rigid and fixed in the regulations. People will get the payment at the 2018 rate from 1 January 2030 to 31 December 2030. The system is fixed; it is not flexible.
I am looking at the regulations to try to understand things. They are important, because they are the basis on which payments will be made for specific periods of time. The regulations cannot be amended—if they go through, that is that. As I understand it, other regulations would need to be made. Am I right? I do not know. I am asking.
Is that correct?
Yes. The reason why the rates are set in regulations is that they are for large administrative schemes. It is to allow—
I understand the reason, but they are fixed.
No. As the minister said, they are fixed until a replacement less favoured areas, or areas facing natural constraints, support scheme comes into play through the 2024 act. The development of that scheme will be articulated in the rural support plan. The regulations are simply to act as a backstop to keep the machine alive.
Honestly, I understand that. Maybe you are saying that we have a system set up until December 2030 but that, if another payment method was developed sooner, the regulations could just be annulled.
The present scheme would no longer be relevant.
The regulations would be annulled because they would no longer be relevant.
Yes, and the—
That is all that I wanted to know. I am just trying to get my head around the law.
The real concern is about the timeframe. In the farming community, there are already concerns about the length of time that it is taking to produce the rural support plan and all the bits that are attached to it.
The timeframe in the regulations creates a fear that we could still be on 2018 funding for LFASS in 2030, because, if we pass this legislation, there is nothing that the committee or the Parliament can do to change it or to force the Government to change it. That funding rate could just go on, and that is not acceptable. That is what we are trying to say loud and clear. You can give us assurances, but you cannot set it in stone that that will not happen.
You are right. All that I can do is give you the assurance that we are working incredibly hard right now to bring forward the legislation that will allow us to continue to support agriculture in the way that we want to support it. If the 2030 date is the problem, I can take that point on board, but that date is purely to allow us time to get things done and to get things moving in the right direction. However, I reiterate to you what I said to Emma Harper—namely, that I am absolutely committed to ensuring that we bring forward policies and proposals that will work with and for the rural and agricultural community to ensure that we can continue to support it as best we can in the future. That is all that I can give you.
I share the committee’s concerns that the 2030 date will have the effect of retaining until 2030 the current rate of payments, which was set in 2018. We just have to take it on your good word that there will be further statutory instruments, over which we, as a committee or as a Parliament, have no control. Therefore, unless the Government is minded to do otherwise, we could see the current rate of payments lasting until 2030 through another Government, potentially, and through multiple ministers. We are expected to put that into law today. Is there any reason why that date could not be 2025 or 2026? What is the reason for pushing it to 2030?
The route map sets our timetable for the phased transition, through the 2024 act, of new schemes to replace the present models. The rationale for the longer date is very simply to avoid unnecessary use of time on this. The core point is that we are not changing the SRDP policies; we are not changing the outcomes that the policies work towards—
I am sorry, did you say to prevent undue time on—
To—
To who?
To all who are involved in this.
One of our biggest concerns about the new agriculture act was the lack of scrutiny. We all accepted that a framework bill was the way forward, to allow policy to be fleet of foot in order to address issues that come up. One of the biggest concerns was about the situation in which Parliament would lack the ability to scrutinise this type of thing. Given Parliament’s desire to be involved, I do not understand why you would see potentially revisiting such a policy in a year’s time—or six months’ time or two years’ time—as an issue. That is exactly what Parliament wants to do—we want to scrutinise it.
Today, we are expected to pass a regulation that would allow the Government to pay the current rate up to 2030. That is very restrictive; we would then rely on the Government to introduce further secondary legislation to address that. That appears to be the committee’s view, at the moment.
There is another important consideration. Minister, what your views are on rebasing payments?
The rebasing argument is on-going. I know that some committee members have been approached about it and that some farmers wish payments to be rebased. That is an on-going conversation. At one point, the NFUS brought it to a conversation in a committee—I cannot remember which committee—and it wrote to the cabinet secretary to ask her to carry out rebasing. The idea was rejected at that point, because we were looking at the whole structure of the policy programme for the future. I am more than happy to look at every potential opportunity to make the best use of the funding that we have to make it work in the best way possible, which goes back to the point that I made at the start.
Would this piece of legislation mean that rebasing was off the table, potentially until 2030?
No, it would not, because, if the position that we took was that rebasing was desired, that could be brought in at a later date, but before 2030, in other legislation that might come forward.
13:00
I want to clarify something. You said that there is potential flexibility with regard to retargeting or choosing to support new entrants. You have already said that that is part of the potential future plan, so that the matter is not just pigeonholed—so that the issue of rebasing is not just kicked into the long grass.
We will look at all the opportunities to allow us to pay in the best way for the less favoured areas, and that is still up for discussion.
Surely the fact that this SSI describes the 2030 payment means that there is not really a rush to consider anything in the meantime, and that it will not be a priority for Government to change something if there is certainty up to 2030. As it is written, does the SSI not risk nothing really happening in the meantime?
No. As I said, the programme is on-going. The ARIOB is meeting again tomorrow—it meets regularly—to flesh out what we are going to try to deliver. This SSI is purely about making available the mechanism to be able to pay. That is it.
Was there a discussion about how many years to include in this SSI, and why was the number that is in it reached?
As James Muldoon pointed out, the 2030 date is to give us plenty of flexibility so that we do not take up any more time than is absolutely necessary. This bit of the instrument is nothing more than a mechanism.
Four years would also be quite a bit of flexibility, would it not?
Yes.
So, why is it six years?
The convener has already asked why we did not make it 2026 or 2028. The year 2030 is what was picked. I am not sure that the relevance of that is going to enlighten us any.
So, there were not particular discussion points when choosing that date.
It is the date that was picked.
We have had a wide-ranging discussion. There is still quite a level of uncertainty over this. The committee has no desire to reach this cliff edge, but there is flexibility with regard to when we can make a decision on the instrument. Therefore, I am minded to defer formal consideration of the motion to approve the instrument until a future committee meeting, if members are happy to do that. That would also give the minister time to consider whether it would be wise to reconsider and to withdraw the instrument for future considerations.
On that basis, does the committee agree to defer formal consideration of the motion to a future committee meeting?
Members indicated agreement.
We will suspend briefly to allow for a change of witnesses.
13:03 Meeting suspended.Charges for Residues Surveillance Amendment (Scotland) Regulations 2024 (SSI 2024/218)
Item 6 is consideration of a negative instrument. At last week’s meeting, the committee agreed to defer consideration of the instrument in order to take evidence from the Minister for Agriculture and Connectivity before we disposed of it.
I welcome back to the meeting Jim Fairlie, Minister for Agriculture and Connectivity, who is joined by Scottish Government officials Jesus Gallego, senior policy advisor, animal health and welfare division, and Keith White, solicitor.
I invite the minister to make some introductory remarks.
I thank the committee for giving me the opportunity to clarify the intended consequences of the instrument, taking into account the comments that were made by the Delegated Powers and Law Reform Committee, and by this committee at its meeting last week.
The primary aim of the instrument is to ensure full cost recovery for services relating to the surveillance and inspection of animals and animal products for residues of veterinary medicinal products relating to the national residues control programme, or NRCP, which is managed by the Veterinary Medicines Directorate, or VMD, across Great Britain.
On anticipated costs, the policy note accompanying the regulations states that the annual cost of delivering the NRCP currently costs around £5 million per year, which is forecast to reach around £8 million per year by 2028. The increase is due to a rise in the costs of procured services that are necessary to deliver the programme such as sampling, testing and consumables.
Without the proposed revisions to the current charges that NRCP participants pay, it is forecast that there will be an underrecovery of the costs of the programme by £1.2 million in the current financial year, and the deficit is expected to rise to £3 million per year by 2029.
It should be stressed that the increase in cost is the estimated cost across Great Britain, so Scotland will contribute less to the overall increase, given that there is a smaller concentration of participants here. Currently, more than 500 companies across the various sectors are included in the NRCP.
I want to pick up Rhoda Grant’s point at committee last week about whether an island impact assessment was considered. As this is not a new policy, strategy or service that is likely to have an impact on an island community that is significantly different from the effect on other communities, it was considered that, on balance, no assessment is required.
By way of conclusion, I reiterate that the NRCP is a statutory programme and is designed to help protect human health by identifying unsafe residues of banned substances, veterinary medicines and contaminants in products of animal origin before they enter the food chain. The NRCP helps to protect human health. It also provides assurances to the UK’s trading partners about the quality and safety of exported food products of animal origin. The programme helps to support international trade, which is worth around £12 billion to the UK economy per year.
I am happy to take any questions, with my officials.
Thank you, minister. Do members have questions?
My concern in relation to an island impact assessment is that I believe that the regulations could have an impact.
The minister will be well aware that people have been talking for a long time about micro-abattoirs and the benefits—both animal welfare and economic—there would be if island communities, and smaller communities away from markets, were able to have abattoirs. They would be able to sell their own meat locally, the tourism industry would benefit, because there would be local produce available, and people could sell online. It would make for a huge economic boost.
Anything that adds to not only the cost but the bureaucracy of the process pushes all those things further and further away, and my concern is that the regulations might do that. They might just add another hurdle to get over. I am not suggesting for one moment that we are making great progress with having abattoirs—in fact, some that we have are already under threat—but the regulations could, first of all, dispense with those that are there and, secondly, stop us from getting others.
I concur with what you have said about abattoirs, particularly in island areas, and if we could do more to help that situation, I would absolutely get on board with that. However, the SSI is about protecting human health and ensuring that nothing has been added to animals and animal products. Abattoirs already have to comply with the measures, so bureaucracy wise, the SSI will not make any difference.
I get that there will be a cost increase—and percentage wise, it looks like a lot—but as far the cost to a small abattoir is concerned, I think that, given that it applies on a cost-per-animal basis, it will not be enough to put that abattoir over the edge, as it were. As a result, there was no need for a separate island impact assessment.
I guess that what I am trying to say is that, at the moment, abattoirs are clinging to the edge by their fingertips. We are struggling to get others in place—which is what we really want to happen—and the cost increases just push the direction of travel the wrong way. Is there anything that you can do, especially for island communities but also for other communities that are a long way from the centre—we have been talking about Skye abattoir and so on for a long time now—to mitigate the challenges that are posed not only by the cost increases but by some of the other challenges, if we are to be realistic about making that increase in provision a reality?
The fundamental thing that we have to remember is that this is a statutory programme that we must carry out order to protect human health. The testing system is about making sure that no residues go into the human food chain.
I completely take on board all of your points about how difficult this is, and I have already agreed to meet other members to talk about what more we can do to help the more remote—again, I want to stop using that word—island communities with regard to slaughtering provision. However, I do not think that the increase in charges will be the clincher here. In any case, we have to carry out the programme to ensure that we are protecting human health, as much as anything else.
Could I be included in those discussions? After all, I represent an area where the issue is crucial.
Absolutely.
This discussion sounds a bit similar to the one that we had on the previous regulations. Minister, have you done any assessment of the impact on smaller abattoirs or processors?
Not on an individual basis, no. We looked at what we needed to do in order to achieve full cost recovery on the programme of surveillance of veterinary residues.
Do you know by what percentage the price of an average test for cattle will go up?
I think that it is about 64 per cent.
Surely that will have a significant impact on some of the smaller abattoirs. Everybody will agree on the need for the inspections—and that situation is not changing—but we are talking about a significant rise in costs that might have an impact on smaller processors. In fact, one plant that I have been in contact with has suggested that its costs will increase by almost £20,000. That is not inconsiderable—indeed, it could put them over the edge.
The point is that we are making a decision today on whether to make any recommendation on the instrument, and we want to be sure that the Government has considered the potential adverse impact on small abattoirs. We know that we have a critical mass situation in Scotland, with our abattoirs, auction marts and so on worried about the cliff edge and the number of cattle that are going through. What were the Government’s considerations on that issue?
I will let Jesus Gallego answer that question about what considerations happened on the ground, as it were.
13:15
The consultation document contains a worked example for a typical slaughterhouse, but it is for a typical large slaughterhouse. The estimate in that example is around 100,000 cattle per year. However, because the charge is on a per headage basis, it can be applied equally to any size of slaughterhouse. Therefore, for a typical micro-abattoir on an island slaughtering, say, two cattle heads per week—or 100 per year—the increase of 20p per year will mean £20 per year in total. The amounts that we are talking about in that scenario are very small, simply because the throughput is very small. The amounts for the large slaughterhouses are very large, because their throughput is very high.
We did not look specifically at an island-versus-mainland comparison, but we know that most micro-abattoirs in Scotland happen to be on the islands. The fact is that you can estimate the cost based on the size of the abattoir, not necessarily on its location. Generally speaking, though, even though the percentage increase from 50p to 70p per cattle head seems very high, the increase per year for a very small abattoir is very small.
I call Rachael Hamilton.
The same consideration will apply not just to abattoirs but to game processing plants, milk producers, fisheries, aquaculture products and so on. I note that Salmon Scotland responded to the consultation. My point about this SSI is that it is disappointing that, although most of the responses came from GB-wide stakeholders, there was only one Scottish response. Salmon Scotland’s response speaks to some of the concerns that the committee has raised in the past about the engagement process and ensuring that people are not taken unawares by the potential for increased costs.
As my colleague Rhoda Grant, in particular, has pointed out, we are in a difficult trading environment, with costs rising as a result of inflationary pressures. What efforts are being made to ensure that, in this scenario, there are no cliff edges?
Again, I go back to the point that Jesus Gallego made: the charge is based on headage going through the abattoir, so it will be consistent with the throughput of a particular slaughterhouse.
But what about a small dairy—
I just want to reiterate that this is a statutory programme that we have to carry out in order to protect human health, which applies across the whole of the UK. As the £3 million excess that we are looking at affects the entire food sector in the whole of the UK, it should have minimal impact. I have to say that we had very little in the way of responses; people have not been responding to the Government to say that there is a real problem with this.
Just to be clear, most people wanted the sector-based and tailored option. You have talked about headage of cattle, but how is that equated? Is it according to, say, litres of milk? With a game processing plant, is it a brace of pheasants? How does it work?
I can take that, minister. For cattle, sheep and pigs, it is per headage. For most of the other commodities, it is per weight—that is, per tonne, per 100 tonnes et cetera.
How is that equated and worked out? How do the sectors know how much they will be charged? For example, a small game processing facility might have only a tonne of output.
In the case of game, the charge is £1.04 per tonne. Estimates of the costs are made sector by sector and, interestingly, wild game is the only sector in which the charges are not going up at all—in all the other sectors, the charges are going up.
The national programme is based on collecting, in total, around 30,000 samples in all sectors across the whole of Great Britain, but they are split between commodities and so on, based on risk. Some samples are more efficient to collect than others. The Veterinary Medicines Directorate apportions the costs based on the cost of each sample. For example, it is much easier to collect samples from establishments that have a permanent presence, such as abattoirs, than it is to collect them from places where people would have to go specifically to do that. The consultation showed that the industry supported each sector being considered on its merits, rather than an approach being taken across the board. That resulted in there being no increase at all for some sectors, such as wild game.
I am very interested in the issue. I do not think that there will be a motion to annul the regulations or anything like that; we are just interested in scrutinising them.
I notice that you have the costs handy. What are the costs for milk production?
The current cost is £0.0276 per 1,000 litres. This year, the cost will go up to £0.0373 per 1,000 litres, and, from 2025, it will go up to £0.0405 per 1,000 litres.
Okay. The only thing that I will say in relation to there being no business and regulatory impact assessment because the Government says that there will be no “significant, effects on ... business” is that, if a dairy business or the owner of a game processing plant were here, they would probably say something different. I just want to put that on the record.
I have a couple of questions. Who evaluates the delivery of the service in Scotland? What is looked at in the evaluation? Prior to considering increasing the costs, was any additional work done to look at whether the service is being delivered efficiently? Were any mitigation measures considered before it was decided to increase the costs for industry?
We evaluate the programme. The Veterinary Medicines Directorate produces an annual report on the conclusions of the programme. For example, we have to present our conclusions to the European Union in order to maintain our export approval. We are also involved as customers when the contract for laboratory services is procured. That contract is outsourced.
A large proportion of the costs come from sampling, which is completed mostly by competent authorities. In our case, that tends to be done by either our staff or contracted staff from the Animal and Plant Health Agency, for example. A large proportion of the costs relate to staff costs and staff time, so the costs are going up due to inflation.
The lack of vets or anything like that has not had an impact; the increase is simply down to staffing and laboratory costs.
It is generally down to costs that are associated with staffing, outsourcing labs and consumables.
Is there still a requirement to test for some residues? Does there need to be a review of that? There might have been an issue with some antibiotics, chemicals and pesticides in the past—I am thinking of dichlorodiphenyltrichloroethane, or DDT, or other things for which there needed to be testing—but is there scope for reviewing what residues need to be tested for to ensure public safety? That might result in a reduction in costs.
The national control plan is reviewed annually. It is a risk-based control plan that is based on findings from previous years. Some things cannot be changed because of international obligations, but, yes, there is scope for reviews.
That is most helpful.
We move to formal consideration of the instrument. As no member has any further comments, does the committee agree that it does not wish to make any recommendations on it?
Members indicated agreement.
I thank the minister and his officials for attending the meeting. That concludes our business in public.
13:26 Meeting continued in private until 13:26.Air ais
Pre-budget Scrutiny 2025-26