Agriculture Reform Implementation Oversight Board minutes: 8 March 2024

Attendees and apologies

Cabinet Secretary for Rural Affairs, Land Reform and Islands, Mairi Gougeon ( Co chair)

Martin Kennedy ( Co chair)

Items and actions

Welcome and previous minutes - Agenda item 1

Chair welcomed her co-chair and members to the eighth in-person meeting of the Board and noted apologies. Chair welcomed the Minister for Agriculture and Connectivity and was delighted to confirm two new members - Gordon Caldwell and Lucy McGillivray. Chair asked for an update from the members tasked with an action from December (To investigate supplementing existing mapping with information on biodiversity-related expectations of farmers through the supply chain) who confirmed work was ongoing and would report back in due course.

The minutes from December’s meeting were signed off barring a small error which will be amended ahead of publication. There was a separate request for the Board to receive draft minutes earlier when discussions are fresher in memories; Chair concurred. In response to a concern about the Tier 3 paper being presented for information, Chair noted that the agenda was compiled to prioritise key issues and reassured members that, per the workplan, a fuller discussion on Tier 3 would happen at the next substantive meeting of the Board. There was concern over lack of supply chain considerations both in the Tier 3 paper and wider Route Map, with the suggestion that a working group be set up and an action was taken.

A request was made to consider at an early stage how common grazings will interact and integrate with all tiers, noting the criticality of discussion around common grazings and peatland code. A member stated that this work is at an impasse; peatland restoration is routinely not taking place on common grazings. Chair agreed and asked for a specific action to be taken. Officials added specific questions from the Board they could be submitted to the Secretariat in advance for consideration by officials. On the ARIOB 2024 workplan, members noted the quantity and suggested interim meetings on specific topics; Chair did point out that interim gatherings are always on the table, as with the previous week’s (w/c 26 February) online meeting on biodiversity apps. An action was taken to hold interim meetings on Tier 2, 3 and 4.

ARP Route Map: 2025 scheme updates - Agenda item 2

Officials provided an overview of proposed updates, including 2025 changes and the communications plan, in confidence. Officials clarified that Parliament is yet to be formally told of proposals but that a public announcement is imminent. As ever, members’ feedback informs policy development and advice to Ministers. In summary, Cross Compliance: peatland and wetland conditions will be added to the existing GAEC with a 50cm depth Scottish Suckler Beef Support Scheme (SSBS) a calving interval limit of 410 days has been chosen, measured on an individual animal basis rather than herd (whole payment rather than split). Finally, for the Whole Farm Plan, there will be an obligation to conduct two of the available five audits/activities, most relevant to the businesses. Materials are being prepared for stakeholders and the internal comms lead is setting up an engagement group, including external and internal (to SG) people, to build up consistent messaging on benefits and adoption. That messaging will be shared with all of the organisations represented at ARIOB (and FAST and the ARD) to test its usefulness. To note, there will be some questions without answers but SG officials are preparing a broad FAQs using plain English. Fundamentally, however, the Whole Farm Plan and Cross Compliance will be the basis of Tier 1 (Base) from 2025.

Comments from members

There was general acknowledgement that the calving interval was realistic and achievable to encourage mass uptake

The comms plan was cautiously welcomed, with a plea to be clear about requirements from 2025 rather than a “quiet” roll-out

A member warned against mixed messaging and gave a recent example of being misinformed in relation to Preparing for Sustainable Farming (PSF) eligibility, noting the need to avoid eroding the trust between organisational representatives and stakeholders. Chair acknowledged this and apologised for the miscommunication

There was discussion on a possible SSBSS exemption for small producers. Officials confirmed that small producers were key to settling on 410 days, and there is a degree of protection within the scheme for island businesses, but that no specific derogation will be available. Some members, including co-chair, were disappointed with this and wondered if such a derogation (or something more “light touch”) could be re-examined, particularly as small producers help ensure remote areas are populated and there is an increased risk to the business if the bull fails. Different views were offered given current data indicates that smaller scale producers don’t necessarily have a larger calving interval so an exemption may not be appropriate and all existing support schemes have a process for exceptional circumstances

There was a plea to communicate on SSBSS as priority given bulls will be put out in the early Spring and to include the consultancy sector to anticipate questions when details are published. As part of the external comms, the website is clunky with key initiatives often hidden meaning the message is difficult to land widely. Chair agreed that the RP&S website is difficult to navigate and if there is a way to make information more accessible then it will be done an action was taken to investigate

On WFPs, reassurance was offered that quality assurance members will receive mutual recognition for audits already undertaken elsewhere – that SG are not asking for duplicated effort. Advisory capacity was raised again as a critical issue but that is fundamental to the two out of five introductory approach, with the express hope that many farmers and crofters can complete these activities without the use of agents. Comms will cover this, centring around benefits and baselining and, further to earlier discussions, it is likely the WFP will take a different approach for smaller producers

Officials confirmed that from 2025 enforcement will be on a self-declaration basis followed up by inspection, warning letters etc. with more detail released in June, bearing in mind delivering a proportional and pragmatic system.

While information on 2025 was widely welcomed, there was a clear desire for 2026/2027 detail for businesses to be able to plan better and that the Route Map has not had the desired effect

A query was raised regarding quantifying the likely impact on emissions given the significant 2030 target. The inconsistencies and inaccuracies of carbon auditing tools were raised again, noting the need for robust baselining across Scotland to better inform policy making, otherwise decisions are being taken from data not fit for purpose. There was an action taken for this to be examined as well as a further action to investigate FBAS accreditations for auditing action.

ARP Route Map: 2026 update - Agenda Item 3

Officials made clear that measures are being assessed more widely than the enhanced tier, looking at the list as a whole and what might be added/moved tier to align the framework. So too has research revealed that people want preventative measures but that SG needs to provide a financial incentive for universal uptake. The next meeting of the Board (31 May 2024) will cover the options in detail.

Comments from members

Co-chair said the industry is keen to see an end to confusion and clarity on Tier 2, what the value of the measures will be and welcomed the deep dive discussion at the end of May. He raised concerns about movement between tiers, arguing for stability in the first period of the new framework. Officials agreed with the need for wider understanding but there may be good reasons for flexibility (increased ambition) and with clarity on frequency of change as well as advance notice. However, it is important for new measures to bed in and measure progress before any changes would be made

Each measure needs to have an appropriate rating including cost and societal basis while making clear the likely increased output and financial benefit, even though it may take time – it’s about building long-term business resilience

There was notable disappointment and frustration from some members that what was presented by officials was not provided to them in advance

Many members agreed with co-chair on tier movement; it could undo a lot of what is being sought, especially as the nature of Tier 2 measures will take time to deliver on the ground, as mentioned. Even a 5 year window was argued to be too short a timescale to measure success (or otherwise) so movement would be inadvisable

Members raised concern regarding what appeared to be lack of representation across the whole of the country in terms of user research, and the self-selecting / higher performer element. Officials reassured that data presented wasn’t comprehensive in that respect and that users did reflect the whole of Scotland

Regionalisation, LFASS and the overall delivery mechanism was discussed, with the hope this would be prioritised

The national level picture is necessary but without centralised, standardisation of data it would be difficult to provide accuracy. LiDAR was highlighted as a potential solution

An action was taken to revise the ARIOB workplan and allow members to comment on sequencing of topics, which may include interim meetings.

ARP monitoring and evaluation - Agenda item 4

Officials provided a high level introduction, flagging that this work is in its infancy but they wanted to engage with the Board at an early stage and will return with further developments. Monitoring and evaluation of the Programme will track progress against the five key outcomes: Support for a Just Transition, High Quality Food Production, Thriving Agricultural Businesses, Climate Mitigation and Adaptation and Nature Restoration. This will help to assess value for money, policy and delivery success. Simultaneously, officials want to build trust externally through transparency of process. Phase 1 will commence Spring/Summer 2024 with further external engagement with the ARIOB at their Q3 meeting (Autumn 2024).

Comments from members

Monitoring and evaluation depends on a stable base to work from and it was argued by one member that this was currently lacking; another member felt it would be very difficult to meet the M&E timescales as presented without appropriate resource

There was a hope that existing good practice, as well as the wider economic benefit, can be measured to avoid the counterproductivity of top performers going backwards and that should be made clear in the language

Members asked how benefits could be measured when funding hasn’t been appropriately addressed. Officials replied that the draft outcomes are a starting point and made clear that Government is not penalising those already on the journey

How do we ensure that the inventory is keeping pace with developments on the ground? The example of methane inhibitors was given as an example. Agricalc is the most commonly used carbon auditing tool – how much access does the SG have to that data? An action was taken to investigate

Biodiversity - measures of success - Agenda item 5

Following the last meeting of the Board where they were given an overview of the Scottish biodiversity strategy, over 600 consultation responses were received. The headline feedback was the appreciation of ambition but a desire for more detail on actions. NatureScot officials presented their first attempt at trying to get the terminology right, using careful language to break down what the strategy actually means in practice through the ‘4 R’s’: refraining from causing negative impacts, reducing the impacts that are caused, restoring impacted nature and renewing nature through proactive conservation actions. Farmers and crofters can do this through 5 basic actions: improve soil health, enhance field margins, enhance permanent habitats, create new nature-rich habitats and manage farmland species. Ultimately, this is a starting point in setting a metric for biodiversity and will undoubtedly evolve in the future.

Comments from members

The language used remains a struggle for some, the meaning of ‘nature positive’ being highlighted as an example

A further request for LiDAR to assist this work was made and officials agreed it may provide the required data

Group-based management will be key to ensuring the success of this work, allowing groups to take part connectively, including what is now “ineligible land” within boundaries – ineligible features should be counted as well as the definition itself

In terms of improving soil health, this should include below ground management which can be forgotten about

Rather than the use of “maximum” sustainable output, this should be “optimum” to avoid potential connotations with exploitation of resources

In terms of tradability, Government must remember that there are often factors outwith the control of businesses which can thwart achieving desired outcomes (e.g. utility firm infrastructure, tenant farmers). Officials remain alert to that but in terms of the actions outlined, there is something there every farm can do, even if not all five

There was a warning that by allocating 30% to nature this could and likely will be perceived as only being able to farm 70% of your land and Chair agreed, highlighting it was not a case of either/or

On baselining, a question was raised about data gathered through the biodiversity audit app and where this would be stored. This goes back to the earlier discussion about data capturing; will it inform individual farms or “Scotland PLC”. It is currently for individual farmers but could, in time, form an overall picture. The digital platform allows aggregation from data registered on the app

In response to a question on private markets, officials confirmed that a workstream is in development on biodiversity private capital. How we define the metric for private markets? This will include an audit of audits - what else out there being used? Public sector governance needs to ensure integrity and potentially set metrics which can become a baseline for the private sector too.

AAP food production follow-up - Agenda Item 6

The Academic Advisory Panel (AAP) representative referenced the Panel’s February meeting, the note of which has been circulated to the Board, including a link to the seasonal migrant worker report as commissioned by SG. AAP looked at this topic in the context of inflation, the cost of living and post-Brexit labour availability. Other factors include additional costs of energy and fuel and no extra paid for food producers. The Panel recorded four key areas to brief on

Support for producers: offshoring concerns – international competition for seasonal labour. Broader public goods – issue around supply and ethical issues (worker exploitation). The AAP recommends visa extension and moving workers between farms to improve business efficiency and consent to work longer hours (where workers request

Support for workers: Survey in the report shows 80% are content but what can be done to enhance conditions for the 20%? A telephone helpline, improved accommodation, better contracts.

Tech solutions: Can we be less reliant on seasonal workers? Unlikely in the short-term as machinery lacks speed and quality of picking so skilled operators required. A permanent shift away from workers isn’t feasible. Can modelling to help?

More information is needed on economics and sensitivity of farm business income to costs. An action was taken to circulate a paper on the impact on farm business income through labour loss.

Comments from members

Co-chair and other members highlighted the significance of labour costs to businesses and that the real living wage (Bute House Agreement commitment to Fair Work) has a big impact on getting workers

It was pointed out that labour issues are associated with other sectors not just seasonal – extensive livestock systems have labour shortages. An insufficient skilled labour capacity means a lot of businesses are understaffed

Housing is another factor where workers are competing with tourists and second home owners

AOB

As requested in advance, a member presented an SAC Consulting paper on sense checking the list of measures, across Scotland, in an arable context.

Following a survey of arable farmers, the majority were already doing or were willing to consider taking on this work. Feedback was positive when measures were seen firsthand with geographical differences acknowledged (implementation of some measures may not be viable in evert field). There was some concern among respondents over the lack of available information and therefore an inability to prepare. In addition, the cost barrier was noted as a constraint for hedgerows and pollinator strips so funding under Tier 2 would be required.

Comments from members

Practicality was raised; optimising hedging can be difficult with drains and dykes

Others felt that a dyke is a habitat in itself so no need to add hedgerows

Funding would be very difficult, especially if it means land being taken out of production as a result of hedgerows

Could we increase the width of existing hedgerows? Society needs to start taking up measures for wider benefit and it was stated that a large percentage of hedgerows are outwith farms and not privately owned

LiDAR can determine buffer zones and determine where best to put hedgerow and better link up for wider corridors

Arable and dairy sector making progress because of supply chain sector pressure but the sheep sector can’t use measures and they take up a lot of Scotland, that needs to be addressed somehow

Shelter belts are often poorly managed and much gain to be made there, they shouldn’t be a biodiversity desert

Differentiated weightings based on systems probably required. If we want the change required we need transformational money

It would be helpful to understanding the financial benefits of this as well as cost barriers and could this be examined in more detail? QMS and Pasture for Life – what have been the benefits to the system? An action was taken.

Co-chair acknowledged some of the actions to take away including an update to the workplan and interim meeting on Tier 2, as well as prioritising messaging on Cross Compliance, SSBSS and the WFP. There was a further request from members to prioritise carbon markets within the AAP’s workplan (move up from August) and an action was taken. Senior officials flagged resource limitations, specifically in relation to work on Tier 2. Officials need to work out what concrete information can be provided to the Board and what implications that would have for the workplan.

Co-chair mentioned that some of the robust feedback provided to officials on Route Map updates pertaining to Tier 2 (described by some members as last minute), was not all their fault, as co-chair asked for the update given the industry’s desire for clarity. He reiterated that this is why an in-depth discussion on Enhanced at the next substantive meeting is imperative.

Co-chair thanked members and presenters alike and looked forward to seeing them again in May in-person.