Dairy Sector Climate Change Group: report

10. Delivering Change

Scotland (like many nations) is measuring progress to net zero by adopting national targets which have been disaggregated into industry and sectoral targets. While targets are one way of accelerating change and allowing measurable progress, they should form one tool in a wider toolkit of incentives.

The survey of farmers carried out by the Group demonstrated the motivation for change, with 86% of respondents feeling that climate change presented a serious or the biggest single challenge for Governments. This suggests that dairy farmers are open to the challenge and will respond positively to the correct incentives.

To deliver change there needs to be motivation, opportunity and capability.

Graphic text below:

Capability

Does your target audience:

Have the right knowledge and skills?

Have the physical and mental ability to carry out the behaviour?

Know how to do it?

Opportunity

Does your target audience:

Have the resources to undertake the behaviour?

Have the right systems, processes and environment around them?

Have people around them who will help or hinder them to carry it out?

Motivation

Does your target audience:

Want to carry out the behaviour?

Believe that they should?

Have the right habits in place to do so?

10.1 Capability - Knowledge

As indicated in Section 9.1, a Centre of Excellence could incorporate a knowledge hub or knowledge transfer centre. As the DSCCG discovered when delving into this topic in more detail, there is a confusing array of scientific papers, pilot schemes, advice notes and other resources available. However, it is time consuming and daunting to try to pull out the relevant information for an individual farm business, even for advisers. What is required is a one stop shop for dissemination of academic research and the newest ideas from around the world. Time-poor farmers can seek out practical answers to complex questions and be supported to resolve issues faced, this kind of help can be an unblocker to enabling ideas and overcoming on-farm problems in an efficient manner.

Such a facility would also provide a managed peer-to-peer learning and idea swapping centre. It would be used to filter and moderate peer to peer YouTube style reviews of innovative, novel ideas and practices, so capturing often passed-by practical on-farm improvements and solutions.

In addition, a network of environmental-improvement farmer-led co-ops should be created and supported. This can be done on a similar basis as the very successful Scottish Enterprise led "Planning to Succeed" financial benchmarking groups.

The further step of enabling and supporting by the Rural Innovation Support Service^[63] network and funding along the lines of the Knowledge Transfer and Innovation Fund should be made.^[64] Key to these is professional facilitation and project management that keeps the focus and provides the resource that allows projects to go forward that would not otherwise happen.

10.2 Opportunity

10.2.1 Basic annual payments

As demonstrated in Figure 1, even with support payments, only 60% of dairy farms were profitable in 2018. While the dairy sector is proportionately less reliant on support than other livestock sectors, it has the highest the capital intensity required.

As put forward by the Suckler Beef Climate Group ^[65], the DSCCG acknowledges the need for increased conditionality for existing public funding arrangements, moving away from the language of "support" to delivery of societal needs. The requirement for activity-based support will continue, and the conditionality of this support must be measurable and deliverable. Whilst Brexit has provided the opportunity for the delivery of farming support outwith the confines of the Common Agricultural Policy, it must not create an unlevel playing field for Scottish farmers.

Any change to support requires a just transition period. This transition should be used to establish the industry baseline carbon auditing (with full cost recovery), along with animal health plan, nutrient management plan, feed plan, soil testing and biodiversity assessment. Most of these are already actively being undertaken on dairy farms (see Figure 13).

For the conditionality to be meaningful rather than a tick box list of reports, the focus must be on delivering meaningful information to enable change. The outline data should form part of the baseline establishment. The information must be in standardised format and collated centrally, and accessible to all participants.

10.2.2 Capital Grants

To improve emissions efficiency, productivity gains will be required. Many of these would have the dual benefit in increasing profitability, however, the capital cost is often a barrier which grant assistance would help overcome. There are other mitigation measures, e.g., slurry pit covers, which helps reduce emissions but delivers very limited profitability gain. As a result, the level of grant support would need to be greater. The Whole Farm Climate Review would be the gateway to the capital grants and ensure that the funding is being prioritised where it is needed most and will deliver the greatest impact within each farm business. Annex 4 – Recommendations and Support Required outlines the priorities for capital funding, which would sit alongside continued annual activity-based support.

10.2.3 Implementation

The DSCCG strongly supports a whole agriculture approach to the delivery of change. Following the reporting of all the sector farmer-led groups, a Joint Implementation Group should be formed and a pilot phase 1 of the programme opened to all sectors. The industry needs to capitalise on current momentum and not allow stagnation to undermine the work of the respective groups.

It is also important to recognise that net zero carbon does not equate to sustainability. A single focus on carbon can compromise gains needed in other sustainability metrics, such as biodiversity, water quality, food security, animal welfare, viability of rural communities and long-term farm profitability.^[66] The Joint Implementation Group must not be restricted in its remit to climate change as its only objective. This has been recognised, particularly in reference to biodiversity, by all the farmer-led groups and the DSCCG has not sought to duplicate this work.

10.3 Motivation

10.3.1 Market Drivers

Business activity and management decisions should not be driven primarily by public funding.

While specific outcomes desired by society can be encouraged this way, farmers need to be able to respond to market signals and to trade profitably if they are to be sustainable. Where the market cannot deliver an adequate return to allow this to happen then public intervention is justified. Many dairy farmers supply direct to the end user but most supply via a small number of processors who dominate the market. In turn, processors supply a small number of major retailers who both drive and respond to consumer demand (Section 8.1 - Processors and Retailers).

The environmental impact of dairy farming is often portrayed as a negative, and as AHDB has demonstrated in Figure 14 below, where consumers have thought about reducing dairy intake, nearly half of those cited environmental concerns as a reason. This narrative must be reversed, and farmers must respond to what the consumer is telling them. Public funding should assist with this process but the shift must start with the individual farmer.

For farmers to be motivated to change, they also need to be sure that the changes they make will be credited to their industry and sector, notably within the national inventory, and ultimately with the consumer and public. The accuracy of the inventory in recording the changes made on farm will be critical, (see Section 5.1 The Inventory and Targets), to enabling change.

This issue is clearly not just a domestic one. Global forces will also influence the domestic consumer and national policies. In the context of the failure of UN nations achieving their Sustainable Development Goals (SDGs)^[67], the United Nations Food Systems Summit taking place this September marks a point when decisions will be taken about the future production and consumption of food. The Summit Secretariat has called for game changing solutions to pick up the pace to delivery of the SDGs. One of the workstreams underway relates to the "shift to sustainable consumption patterns". There is both a threat and an opportunity here and farmers must engage to ensure a positive outcome. We would also urge the Scottish Government to make robust representations to the ongoing UK contribution to this Summit.

10.3.2 Reward Innovation and Success

Any changes to support must reward innovation and success. The drive to deliver improvements should not be at the expense of those already achieving emissions efficiency, otherwise there is a disincentive to deliver too soon, which is counterproductive. Opportunities for mentorship and demonstration to other farmers and advisers should be rewarded.