Agriculture Reform Implementation Oversight Board minutes: 13 September 2021

Items and actions

Agenda Item 1: Welcome & Introductions

1. Co-Chair (hereinafter referred to as “Chair”) set out the context in which this Board has been established.

2. An integrated implementation board was a manifesto commitment of this government to drive forward the work of the Farmer-led Groups (FLGs). The Board will be asked to contribute to Scottish Government’s (SG) work to implement policy reform and an immediate priority and focus will be to develop a package of measures based on the work of the FLGs for agreement by COP 26 and to be implemented by Spring 2022.  In the longer term, we would expect the Board to consider how we use our land and the role that agriculture can play in restoring biodiversity.

3. It was recognised that the industry needs a clear understanding of future agricultural policy and the associated long-term investments required. This Board can steer the direction of travel for an industry that doesn’t want to stand still, noting that it is not only farmers who will be impacted by this work.

4. Scottish Government has a service design approach to policy making involving user-centred development, therefore, the Board will work in the context of that wider direct engagement with farmers, crofters and land managers.

Agenda Item 2: Terms of Reference – are they right?

General

5. Members of the group discussed some minor amendments to the TOR which were accepted and the TOR will be updated.

Timescales

6. Chair confirmed that the Board will work towards the end of October 2021 as a deadline for achieving agreement on the aforementioned package of measures for announcement at COP 26.

7. Concerns were raised over the short deadline to have something ready for COP and reassurance sought that insufficiently developed measures will not be rushed through simply to meet that deadline.  It was noted however that deadlines are required to drive delivery through consensus-based decision-making.

Agenda Item 3: What are we trying to achieve?

8. Paper 2 sets out what considerations have to be made when making public policy and was offered in the spirit of enablement. Five key pillars were discussed:

• 1. The need to operate within the law; simplifying and improving regulations. This does mean there are constraints but will allow us to test new ideas ahead of a future policy state and look towards a new Agriculture Bill by the end of this parliamentary term;
• 2. Scotland is no longer part of EU treaty agreement (CAP) and this means Scottish policy needs to stand up to scrutiny against the Scottish Government’s National Performance Framework and ensure value for money;
• 3. A statutory requirement to complete impact assessments to ensure we meet the needs of businesses, give appropriate regard to equality and our island communities etc, and these are further detailed in the Paper;
• 4. Alignment with the EU where practicable. There are 9 EU principles which align with Government aims for Scottish Agriculture in principle, though the detail of how the EU proposes that these are delivered has not been assessed for suitability in Scotland. The UK framework for agricultural policy gives the devolved administrations freedom to regulate and engage. However the subsidy control regime may have an impact on that freedom and SG officials will inform the Board of anything that may impact on their work;
• 5. Co-design and co-development is crucial and the Board is the flagship of this method. It will be key to discuss policy reforms with industry and it is hoped that the Board can act as a conduit to convey the message to industry partners.

9. Paper 03, ‘Scotland’s Climate Change Targets - Implications for Agriculture’ was then addressed.

10. The paper should be read in the context of Scotland’s GHG emissions at present: activities that take place within Scotland (not including imports).  The biggest single source of emissions in agriculture is due to sheep and cows; accounting for 75% of GHG in Scotland, albeit has fallen by 13% in the last 20 years.

11. Our GHG targets: a 70% reduction in emissions measured against 1990 levels and net zero by 2045. Last year’s Climate Change Plan update includes the steps required to help us meet these. For agriculture, it assumes a reduction of 2.4 MtCO2e by early 2030s which translates as a 4-fold increase in GHG reduction compared to the current trend in reductions.

12. The recommendations of the FLGs set a range of measures for reducing emissions and focusing on the technical measures proposed (including Methane inhibitors and breeding of low-emission livestock), the SG, with input from SRUC, estimate such measures would get us to reduction of around 1 MtCO2e, which equates to 40% of what is required.

EU alignment

13. The phrase “alignment with the EU” was discussed, with some concern it might tie the hands of the Board in what they are able to recommend.  However, it was noted that “where practicable” applies so there is room to manoeuvre. Board was reminded that this policy position is one of the wider policy objectives of Scottish Government as well as being a manifesto commitment on which the Government was elected. There are practical trade and standards reasoning for continued EU alignment and we should be wary of throwing up any blockers to trade.

Current legal framework

14. It was reiterated that we have to make sure that what we bring forward is in terms of the law. Some of the existing CAP architecture will allow us to make some progress but we will need new legislation in the future.  We also have to consider deliverability of new systems alongside delivering existing ones.

Emissions

15. The complexity of the figures was acknowledged but the main target is the 2.4 MtCO2e reduction (7.7 MtCO2e emissions output in 2019 which has to be reduced to 5.3 MtCO2e by 2032).  

16. It was noted that due recognition for agriculture is critical – only farmers can increase renewables on-farm and so should be getting credit for activities not captured in GHG inventory.  It was agreed that it is hugely important for us to record that agriculture reductions contribute to non-agricultural sector targets. 

17. It was queried if there was a league table of emissions to identify where Scotland sits in the content of the UK, but confirmed that no such table exists.  However, Scotland is broadly comparable with other countries in Europe but lower than large producers elsewhere in the world.

Subsidy control scheme

18. The Board noted advice that it was too early to tell whether the subsidy control scheme allowed Scotland to implement new subsidies, being largely dependent on UK Government (UKG) enforcement and that it was unfortunate that the UKG wanted to keep agriculture in the scheme when it could have been removed.

19. There was some discussion around modifications of existing schemes, such as the Less Favoured Area Support Scheme and the point was stressed that it was crucial to recognise that payment to disadvantaged businesses has slowed down land abandonment in Scotland.

Wider considerations

20. The supply chain needs to be considered when making recommendations as an integral component of the system, as does the importance of the wider market eco-system in achieving our ambitions. Tenant farmers, small farmers and crofters were also flagged up as needing to be considered.

21. Other policies which will impact on the Board, such as the Good Food Nation Bill, Nature Bill, Rural Land Use Partnerships etc need to be explicitly recognised and SG officials will ensure that Board are fully sighted to help inform their recommendations.  

22. Board were reminded that its immediate focus is on the FLGs’ recommendations and principally the 1 MtCO2e reductions.

Agenda Item 4: Future scope of work themes, papers and presentations – workplan

23. The Workplan sets out the proposed approach for the Board’s considerations up to and including 11 November 2021 but is subject to change as required.

Development of proposals

24.The Board agreed that it needed firm proposals, drawn from the FLG recommendations, to consider, and were reassured to hear that Scottish Government is already engaging with stakeholders to work some up and intend to present options to the Board at the meeting on 30 September.   The Board are keen to act and a point made that it might be better to develop and implement proposals iteratively, rather than having to wait for fully worked-up ones. Some caution was sounded around ensuring that any proposals achieve long-term success rather than focussing solely on short-term gains.   It was noted that any new policy  should be considered in the context of other reports (eg Farming 1.5,) and initiatives (eg, POBAS).  

Carbon markets

25. There was agreement that it would be helpful for the Board to discuss the strategic element of the carbon market, noting there was a need to re-evaluate where we are in Scotland in relation to green credentials and be wary of off-shoring carbon credits. The Farming for 1.5 Report was referenced, particularly the recommendation that, “the carbon in Scotland’s soils should not be traded until further notice”.  The Board heard the view that it could consider making a formal recommendation to the SG that it adopt the Farming 1.5 recommendation.

26. The Board were informed that SEFARI are setting up a strategic advisory group on carbon which will review all existing carbon markets and green finance mechanisms, noting the voluntary element of the current system.

The Board accepted the workplan in its current form whilst being mindful it remains subject to change.

AOB

Industry concerns

27. Responding to the concern raised regarding the make-up of the Board and industry perception of its value, the Board were informed that while some scepticism is understandable, it was essential to develop a solid body of background work in order to now fully inform the Board’s sound decision-making. Assurance was given that the focus was on now drawing from that work to deliver. 

Communications

28. It was noted that some of the Board’s recommendations may be less palatable to some, and that the readiness for change varies across the industry. It was agreed there is a need to establish an effective communications strategy as a matter of priority to signpost changes ahead.

Focus of the work

29. While the 100 days’ commitment sets out plans to set up a suckler beef scheme, it was pointed out that the nature of the task inevitably pointed to a cross-sectoral approach. The Board were advised that as the largest emitter, the focus would be on livestock initially, however, it will be for the Board to recommend on.  It was noted that the consultation launched in August is a cross-sectoral one so allows a broader perspective.

30. The Board was thanked for their role in this crucial work. The Government’s commitment to making this a success and bringing industry along was restated, and the meeting brought to a close.

Next meeting 30 September, 09:00