Environment, Food and Rural Affairs Committee
Oral evidence: Covid-19 and food supply, HC 263
Tuesday 30 June 2020
Ordered by the House of Commons to be published on 30 June 2020.
Watch the meeting
Members present: Neil Parish (Chair); Ian Byrne; Geraint Davies; Dave Doogan; Rosie Duffield; Barry Gardiner; Dr Neil Hudson; Robbie Moore; Mrs Sheryll Murray; Julian Sturdy; Derek Thomas.
Questions 217 - 280
I: The Rt Hon George Eustice MP, Secretary of State for Environment, Food and Rural Affairs; David Kennedy, Director‑General, Food, Farming and Biosecurity; Henry Dimbleby, Lead Non-Executive Board Member, Department for Environment, Food and Rural Affairs.
Written evidence from witnesses:
Witnesses: George Eustice, David Kennedy and Henry Dimbleby.
Chair: Welcome, Secretary of State, and welcome to Henry Dimbleby and David Kennedy. Secretary of State, would you like to introduce yourself for the record, followed by Henry and David? Welcome to our Covid inquiry.
George Eustice: I am George Eustice, the Secretary of State in DEFRA.
Henry Dimbleby: I am Henry Dimbleby, the lead non-executive director at DEFRA and the lead of the National Food Strategy.
David Kennedy: Good afternoon. I am David Kennedy, director-general for food, farming and biosecurity at DEFRA.
Chair: It does not seem that long ago since we last saw you, does it?
David Kennedy: No.
Q217 Chair: Welcome again. I am going to fire off with the first question. When did the Government first realise that there would be panic-buying in the shops? When did they start working with supermarkets to deal with the panic-buying? That one is yours, Secretary of State.
George Eustice: The first thing to say is that DEFRA has a team of people who contribute to the Civil Contingencies Secretariat, which is based within the Cabinet Office. We give all the advice on food security and resilience in the food supply chain. This was a situation that was being monitored from January and, towards the end of January, DEFRA had contributed to some assessments of worst-case scenarios and what might be expected. It was on our radar and being watched carefully from the end of January.
In early February, we started communication with briefings through the Food Chain Emergency Liaison Group, which has all the key food businesses, food manufacturers, retailers and so on on it. We started communicating with them on some of the issues and the emerging threats in early February. The FSA had also carried out an assessment of what the potential risks would be alongside that.
There was the watching brief on all of this and it was probably towards the end of February that we realised that we were likely to face an issue. We were getting some useful feedback from some of our companies that have operations in Europe. I can remember George Weston from Associated British Foods contacting me at the end of February to describe what they were seeing in places like Italy.
By the time we got to 6 March, we could see what was happening in other countries more clearly. It was clear that we were going to get the coronavirus and that we would likely see a panic-buying episode. It was about 4, 5 or 6 March that we stood up a number of groups to work closely with industry to manage this situation.
Q218 Chair: There is no doubt that, once you got going, things happened, but the only public announcement that you made about trying to stop people panic-buying was on 21 March, when you and Helen Dickinson, CEO of BRC, appeared at the Government daily press conference. I know it is always easy in hindsight, but should the Government perhaps have been much more direct and earlier in trying to reduce people’s panic-buying? Some of it was not panic-buying; it was just because they knew they were going to be locked down, and so they were not sure, to start with, how many shops would be open. Was there a breakdown in communication?
George Eustice: No. In fact, I would defend what we did and why we did it. We considered all of this very carefully. I had had conversations, for instance, with officials in Number 10 around about 7 March on this issue. I had spoken to Matt Hancock on around 6 March, again about the threat of panic-buying, so a full 10 days before it really got going. We know from all the behavioural research that has been done that nothing gets panic-buying going better than Government coming out and saying, “Don’t panic.” It is a Captain Mainwaring-type approach.
All the evidence is that, if you want to avoid spurring panic-buying, the best thing is for it not to be talked about or covered at all, as far as is possible. There is then an escalation and, once you start to have panic-buying and the genie is out of the bottle, our next judgment was that industry was best placed to lead that response. We worked with them and, indeed, helped to guide some news reporting, going to warehouses to prove to people that there was plenty of toilet roll around and no need to worry about it or panic-buy. Industry demonstrating their resilience was the next level.
It was only really when we had nothing to lose because panic-buying was at full tilt, by around 21 or 22 March, that it was right to come out and make a different type of appeal, which was to say to people, “Stop panic-buying. You are depriving others of food. It is an irresponsible thing to do”. There was a time and a place for Government to intervene and we did it at exactly the right time.
Q219 Chair: I suppose the key to this is whether you would, at another time, have got the supermarkets and the big retailers to say a bit more, more quickly? In the end, they were restricting the number of certain items that you could buy. Would you bring that in a little more quickly? Hopefully, we are not faced with this all the time and it is not a big point, but would you consider that?
George Eustice: We were meeting industry frequently from around about 6 March onwards. We formed a group of the key industry bodies, including BRC, representing the retailers. That following week, a few days later, we set up a regular forum meeting, initially a couple of times a week, and thereafter once a week, with all of the retailers to discuss these issues with them.
The issue that they had was that, initially, if you put a limit on items and said, “You can only buy two toilet rolls or two packs of butter”, the challenge that that created for those retailers—and why they were reluctant to do it until they needed to—was that, when people saw that, they thought, “My gosh, there is a problem here so I had better take my quota. I had better take my two packs of butter rather than just the one I would normally take”. Again, for the reasons I explained, panic-buying is a very difficult episode to manage, to be honest. It creates challenges for everyone because it starts as an irrational reaction and then starts to look more rational as the shelves empty.
The problem that they had was that they did not want to increase demand for products, so they did not go for that capping. It was only once they had such a difficult situation and they could not keep food on the shelves that nearly all of them, about a week later, judged that things had deteriorated to the point that it was the correct thing to do. Again, it is a question of the timing of introducing it. It would not have been helpful to have introduced it earlier, but there came a point in time when it was the right thing for those stores to do.
Q220 Chair: We will park that one there. Just finally from me, there did appear to be an initial misunderstanding within Government about the capacity for online delivery to support self-isolating people. Only 7% of the trade is online. It has gone up to 11% now, but that has taken a while. Of course, lots of other people were taking up the slots, and not just self-isolating people who had to be isolated and could not go to the shops. What is the lesson that you learned from that?
George Eustice: Again, we were conscious of this because we recognised that we were going to have people shielding or self-isolating. The first question I asked the retailers was, “What is your capacity to increase online delivery?” They told me that it was currently about 6% or 7% of the market, and thought that the maximum that they could go to within a realistic short-to-medium-term timeframe was probably about 12%. That is broadly where they got to in the end, through some recruitment and changes in drivers’ hours. We understood that from the very beginning.
I had a conversation with Matt Hancock and he was asking that question, because the Department of Health was, in the first week of March, thinking about some of these things. I explained to him that we felt the maximum we could get to was about 12%, so we were very conscious of that. That is why we also, very quickly, started to move to different arrangements for food parcels done through a commercial contractor for the shielded cohort, and also started work on volunteers.
Chair: Sorry to interrupt, Secretary of State, but we will deal with a lot of those systems through our questions. Thank you very much for that answer. We will park that there.
Q221 Dave Doogan: Good afternoon, Mr Eustice. One of the comments that you made in response to the Chair’s questioning was that the best way to try to avoid panic-buying is not to mention panic-buying. The converse of that is that, if you start talking about panic-buying, people start panic-buying. Is there not an element of this that is novel? We have now lived through a sustained and long lockdown, and people know what happened at the beginning of that lockdown. I hope that we do not, but in the event that we have another wave to contend with and we have to introduce local or national lockdown, can we refine that messaging, knowing what we know and with consumers knowing what they know about the consequences of their overbuying behaviour for the rest of society? What have we learned?
George Eustice: It was a difficult but short-lived experience, and ours was very typical of what other countries went through as well. During those early stages in early to mid-March, some of those retailers that have operations in countries like France and Italy were giving us incredibly useful intelligence, to the point that they were able to tell us, “When you do your first wave of advice to people to avoid non-necessary travel, panic-buying will lead to an increase in sales of between 10% and 15%”, and they were right about that. Lidl accurately projected that within 24 hours of the moment we went into full lockdown there would be a 50% surge in panic-buying, because that is what happened in other countries. Ours followed exactly the trajectory that they predicted.
We were able to have 10 days’ or a little more notice as to what was coming during those rather extraordinary events, and we had some ideas about what we would do to counteract it. Your point is a good one. Having lived through this and seen it, if we had more localised lockdowns, people would be more sanguine and sensible about it, if they had their time again.
Q222 Dave Doogan: In terms of the messaging, the supermarkets were good at this. It was the fear, was it not, in people that they would not be able to get to the supermarket, or that the supermarket would not be open? If that kind of reassurance is at the front end of a “control your behaviour” message—that there is enough to go around and that any shortages will be a direct result of overbuying—does that messaging not have legs?
George Eustice: Yes, it does. As I said, once the genie was out of the bottle and we had full-blown panic-buying, that was the exactly the message we deployed: “Think of others. Buy only what you need. There is plenty of food to go around. We are not going to run out of toilet roll”. Those were exactly the messages that we and retailers were conveying to people.
Q223 Dave Doogan: Finally, you also said—and I have heard this a few times—that the control of certain aspects of this was best left to industry in particular and to supermarkets. Elements of that are true insofar as they have the commercial expertise and operational excellence, particularly in supply chain, in terms of getting goods to where people require them, but they do not have the authority, do they? Government have the authority when it comes to messaging and legislating for shortages. Would you modify that dynamic in the face of a subsequent lockdown?
George Eustice: Again, although it was a very difficult episode and I do not doubt that lessons will be learned, we played the right approach at broadly the right time. As I said, there was a period when we were starting to get an increase in demand of around 10% to 15%. At that point, having news bulletins with pictures of lots of lorries arriving with plenty of food and that kind of reassurance was what you needed to give people. The danger with Government coming out too early is always that you get asked questions that can then lead to unhelpful headlines.
To be honest, the day that I did that first press conference, and appealed to people for calm, I was asked several times by journalists whether we would introduce ration books. There were then headlines saying that we had refused to rule it out or that we were complacent or whatever. This is always the difficulty with these tense, highly strung situations. There is a time and a place for Government to intervene, and we did it at the right point, when we had nothing left to lose.
Q224 Chair: Secretary of State, just before we leave this question, the British Retail Consortium said that the demand for food in the epidemic was just as much as it was for Christmas. For Christmas, they have four or five months to prepare. You would probably agree with me that the retail consortium, between them, did a pretty good job on delivering food to those who could afford it. We are going to talk more about others, but the relaxation of drivers’ hours and all of these things helped, as well as the relaxation from the Competition and Markets Authority. Could you move a bit more quickly on another occasion?
George Eustice: A lot of the planning for a no-deal Brexit that had been done last year, as we contemplated what might be required during January and February, was dusted off and put on standby. The moment when it was clear that we had this panic-buying episode, we moved quite quickly to lift delivery curfews, so that lorries could deliver any time of the day or night and get food to stores. We relaxed drivers’ hours so that they could run with the drivers they had, on longer hours.
There were other competition law easements that would, for instance, enable retailers to sit around with the three bread manufacturers and say, “Rather than having 16 different types of loaf of bread, let us streamline it down to six lines”. That streamlining of lines was critical to being able to substantially increase the output of loaves of bread and other such items. It was an extraordinary response right through the supply chain, but the relationship between the big manufacturers and the retailers was really phenomenal and enabled them, very quickly, to increase production by about 50% from a standing start.
Q225 Barry Gardiner: Welcome to our witnesses. Good afternoon. Can I just say to Henry Dimbleby how much I enjoyed his appearance on Radio 4’s “The Food Programme” the other day? Just picking up from your last point, Secretary of State, Ian Wright, chief executive of the Food and Drink Federation, told this Committee that “this crisis has thrown up an absence of responsibility in Government for hunger and for the 2.5 million people for whom their main meal of the day comes through donated food… No single Ministry or Department has responsibility for that co-ordination”. Is it time we had a Minister for hunger or for food insecurity?
George Eustice: I would make a number of points on this. During this, we announced a package of food aid. A £16 million grant fund was distributed through FareShare and was open to thousands of food charities to help the vulnerable. We subsequently also established a new £63 million fund to help those with difficulty affording food. There are overlaps between Departments. The Department that leads on household food security is DEFRA, and we own the bits of the questionnaires on the ONS food survey, which is an annual survey that looks at the percentage of household spend—both the poorest 20% and on average—on food. We watch food prices and monitor them closely, and we monitor household spending on food.
There is, undoubtedly, an important role for the benefits system in this. The Department for Work and Pensions has a very direct involvement in this. There is also, in some situations, an overlap with local government and local authorities, because some of them will also have their own crisis schemes for those who cannot afford food. It is one of those issues where there is overlap.
Q226 Barry Gardiner: The Food Foundation reported that “approximately 20% of adults”—that is about 10 million people—“in England, Wales and Northern Ireland face food insecurity”. Surely, that at least merits a Minister for food security, does it not?
George Eustice: Food security in terms of household spending on food is a DEFRA responsibility. If it is an issue with the benefits system, that is for DWP.
Q227 Barry Gardiner: It is an issue for Government, is it not? It is an issue that needs someone in Government to assume overall responsibility and to knock the various heads together or to identify which areas in which Departments are the problem areas, and to bring people in Government together to deliver.
George Eustice: Yes, and during this crisis we established a cross-Government taskforce to look at the issue of access to food for those who were vulnerable and could not leave home, as well as those who could not afford food. One of the roles of Victoria Prentis, as Minister who covers these issues within DEFRA, has been to chair that taskforce and pull together other Government Departments to make sure that we have the right response.
Mr Gardiner, I am sure that, if you were to table a parliamentary question on this, you would most likely get a response back from Victoria Prentis. The ultimate test of who takes responsibility for these matters is where a parliamentary question ends up, once posed.
Q228 Barry Gardiner: Before I pass over to Ian, can I just pick up on something that you talked about in your response to the Chair about the discussions you had around 6 March. It was on 5 March that the Health Secretary said, on “Question Time”, that “we are working with the supermarkets to make sure that, if people are self-isolating, then we will be able to get the food and supplies that they need”. In response to that, a number of supermarket executives were concerned, and one accused the Health Secretary that he had “totally made up what he said about working with supermarkets. We haven’t heard anything from Government directly”. That is at odds with the picture of co-ordinated and ongoing discussions that you have just outlined to the Committee. Why was, presumably, a responsible supermarket executive able to come up with a statement like that?
George Eustice: A supermarket chief executive will not necessarily know what every member of his management team and others in his organisation are doing. I cannot remember which supermarket that was now—you might be able to remind me—but I do remember the comment. It is the case that the Food Chain Emergency Liaison Group, which is an official-level group within DEFRA that deals with designated staff within key food producers and retailers, had been convened by that point. There had also been briefings and discussions for several weeks prior to that.
Whether that particular supermarket chief executive had been directly and personally involved in a conversation with either me or Matt Hancock, clearly at that point he had not, which is why he reacted in the way that he did, but people in his organisation would have been talking to officials within DEFRA about these matters. To be fair to Matt Hancock, it was before he was about to do these media appearances that he had this conversation with me and, at that point, I also said to him that I was going to stand up a group of chief execs to discuss this as a matter of urgency. He was right that conversations had been taking place at an official level and he was also right that I had already initiated the process of standing up a higher-level meeting with chief execs.
Q229 Ian Byrne: I am going to direct this question to Henry. The figures that Barry has just outlined, and reports about one in four of our population, are horrific. We have seen the growth of food banks and food insecurity over the last 10 years, but certainly never as much as now, during Covid. In your position, is food security for individuals going to be a focus of the National Food Strategy?
Henry Dimbleby: Yes, it will be. There is a particularly interesting situation that we are going to face over the coming months. If, as is quite possible, a number of people who are currently on furlough do not have jobs come the end of the summer, you might well see a situation where a lot of people whose structural costs are much higher than is normally the case come on to universal credit. Something that we need to reflect on is how we can use multiple parts of the system to support those people, because it is going to be a very unusual situation that our system is not designed to cope with. I am going to be putting some thoughts down on that. I am doing a short interim report in a few weeks’ time on a response to the Covid-19 aspects of the food system, which will include some thinking on food insecurity.
Q230 Ian Byrne: Following up on that, Anna Taylor, the executive director of the Food Foundation, stated that, had the right to food been in legislation before the pandemic, “we wouldn’t be in the situation we’ve got now with such high levels of unmet need”. Henry, should the right to food for all be enshrined in legislation?
Henry Dimbleby: The right to food is a tricky one. I have spoken at length on the topic, both with the Scottish people who are looking at enshrining the right-to-food legislation there, and with Olivier De Schutter, the UN rapporteur on the right to food up until 2014. I take Jonathan Sumption’s view on this, which is that, by a right, you are transferring power on an issue from an elected, democratically accountable legislature to, in his words, unelected judiciary. If you are going to extend rights, it has to be the case that every reasonable person needs to be able to agree on what those rights are. If you are going to move that away from democratic control to the Law Lords, every reasonable person needs to agree.
When you get into the nitty-gritty of what you mean by “right to food”, in a society with a developed welfare system, unlike, for example, India, where right to food has been very successful, it would be very difficult to define exactly what the right to food is. Olivier and I agreed on most things. I found myself in violent agreement that there is a need to think about how the Government’s commitments to change the food system are formed, how they do that with citizenry, how progress is monitored and how they are held accountable for their commitments. There is this thing about the food system; it is across numerous Departments and sometimes falls through the cracks.
I am not personally convinced that the right to food is the right thing to convene those needs around, but I will be going into some detail on the required governmental structures to create the changes that are needed in the food system. That will not be in my interim report but in my final report, which will be later on.
Q231 Ian Byrne: I am going to press on this and ask the Secretary of State, who touched on this before when he said that certain responsibilities being with the DWP and certain responsibilities being with DEFRA. Anna Taylor also said having it within legislation “drives those accountability mechanisms which we don’t have at the moment”, and responsibility then has to be taken. Secretary of State, would you agree that this is potentially an avenue that we may need to go down, certainly because part of this process that we are going through is about learning lessons from what has gone before? Henry touched on the fact that maybe there is no need in this country, but I would probably counter that by saying that, if there are 10 million people who are currently suffering from food insecurity, that puts us at odds with anyone in the world. I would like your views on that, please, Secretary of State.
George Eustice: This is quite a complex area, as Henry has just explained. One of the problems is that it is very hard to do international comparisons on this because, in different countries and societies, people’s perceptions of problems and difficulties in getting access to food differ. Sometimes, the international survey data does not really give you an accurate picture. The best and most reliable data that you can possibly have for food affordability is household expenditure on food and, in particular, that of the poorest 20% of households. That is the most reliable yardstick that we have. We have chosen to address this particular issue in a different way, which is through the Agriculture Bill. Every five years, required in statute, there will be a food security assessment that will look at self-sufficiency and international food security, as well as household food security within the UK. Through that clause in the Agriculture Bill, we have committed to regularly review and monitor this situation.
Q232 Chair: Before we leave this question, I want to widen it. My view is that the Agriculture Bill does not contain anywhere near enough about producing food, producing affordable food and producing the food that provides for a staple diet for many people in this country. Is it not time that the Agriculture Bill, instead of looking at just the environment, which is very valuable, also looked at food production and having affordable food for people to eat in this country? Secretary of State, you talked about reviewing it in five years; I suggest that you review it now, before we bring in the new policies. This Covid-19 and access to food for poorer people is a wake-up call. Would you agree with me or not, Secretary of State? Perhaps David could comment on that as well.
George Eustice: The first review of food security will come earlier than five years. They will happen by law at five-yearly intervals.
Q233 Chair: What about now, Secretary of State?
George Eustice: Chair, you have a difficult Committee to please on this. This is a second attempt at taking in the Agriculture Bill. We listened very carefully to a lot of the points raised last time, so we have placed that requirement for a food-security report on a statutory footing. We have also been explicit that, in designing any scheme under clause 1, the Government must have regard to the need to produce food and to produce it sustainably. That is right inside the Bill. The Bill has provisions to enable us to support farmers to invest, produce more and reduce costs. It has provisions to improve fairness and transparency in the supply chain, and provisions to give us crisis powers to intervene when things go wrong, as they often do in farming, to ensure that farmers have the support they need. I do not really accept the caricature that there is nothing in there on farming. There is quite a lot on farming.
Q234 Chair: I am not saying farming; I am saying food production and affordable food. Surely, reviewing it every five years is not enough, because Covid-19 has just thrown that up. That is the issue. Surely, it is highlighting now that we are not looking enough at food production in the Agriculture Bill.
George Eustice: I think we are. The Agriculture Bill gives us powers to act quite quickly on things, including supporting increased domestic production in certain areas. It gives us the powers to do all of these things. Henry Dimbleby is now working on a food strategy that will also be considering these issues. His first report is coming out later in July and concluding quite shortly, so there will be quite a lot of thinking in this space. Some of this will be considered in the context of the coronavirus.
Q235 Chair: Henry, what is going to be in your report about affordable food and general food production, or is it all going to be the high-end market? Where are you on that one?
Henry Dimbleby: Do you mean the whole thing or what is coming out in July?
Q236 Chair: What is coming out in July, and your general direction of travel. As far as I can see, it is very much the high-end food market. What I want to know is what we are going to do about producing good-quality, affordable food. Are you going to talk about affordable food?
Henry Dimbleby: The intersection of affordability and sustainability, and the debate around how you build the externalities into food, is right at the nexus of any food strategy. In broad terms, I am going to try to set out how the Government can shape a food system that not only delivers the amazing benefits that it does today and the amount of food at a cost that is lower than it has ever been, but does so in a way that stops making people ill and restores and enhances the environment, thinking about whether we need to think about food security differently, particularly with the threat of climate change that comes to us. I will definitely cover, absolutely front and centre, what you are talking about.
In the report in July, I am focusing on looking at what this crisis has revealed about the food system and how it has changed the food system. I am then going to be setting out some principles and immediate actions that are required now. I will be focusing largely on these areas: on livelihoods, given that my sector particularly—hospitality—has been devastated by this crisis; on the issue of food poverty and getting sufficient nutrition through what is probably going to be a very difficult time economically; on health and how we can restore the nation’s health; and on food security and, in particular, trade, in terms of how we need to be thinking about the trade deals that we are doing as we go towards leaving the European Union in December.
Q237 Chair: Does David want to add anything? You are at the height of the ELM review and everything else. Are we concentrating enough on the production of food?
David Kennedy: We discussed this a couple of weeks ago. I would say that the agricultural reform programme under the Bill is very much focused on food production. As the Secretary of State said, there will be many support measures in place to boost productivity. That is about more food production. We want to maintain and improve our already high standards of animal health and welfare. In addition, we want to promote sustainable farming practice. That is tier 1 of ELM in particular, which is a very significant part of the overall ELM. I would say that we do have an absolute focus on that.
Q238 Chair: Will that make food more affordable?
David Kennedy: If farms are more productive, the consequence is that you get more output for a given input. You could see price reductions in that sense. At the same time, we will be taking away the direct payment, so we do not know at the moment quite how those two balance out. Just to go to your broader set of questions, there is a question about how much of the food that we consume here we want to produce at home. Is it the current level? Do we want to be more self-sufficient? Can we afford to be less self-sufficient? This is not just about food security but about sustainability and about standards of stuff that we import too. Henry is considering all of those questions. We are considering them in parallel. We are not just waiting for Henry to give us the answer. The food strategy and the Government’s response to Henry’s advice is the opportunity to pick these questions up.
Chair: You almost tempt me to go into the food standards of what we import, but I had better not go on all afternoon. You know my views quite clearly on that, as does the Secretary of State.
Q239 Geraint Davies: Secretary of State, as we sit here today, something like 6.6 million people—4.9 million adults and 1.7 million children—are in food insecurity; namely, they are hungry today. The problem is not insufficient amounts of food; it is that they cannot afford to buy that food. In three weeks of the lockdown, it was something like 11 million. What are you proposing to do now, in the next few weeks, so that these 6.6 million people who are going hungry as we speak are not hungry?
George Eustice: I may ask David to come in on the figures in a minute, because we have done some analysis of our own about food affordability issues, and I know that there are lots of different surveys out there. We have considered the data from the Food Foundation and others as well to get a more granular understanding. David might come in on that.
The answer to what we are doing is that, quite early in this crisis, we announced a £16 million fund that went to FareShare and was used to support them to get more food to thousands of different food charities, including refuges, homeless shelters and other organisations. The Red Cross were getting food parcels to people in need and so on. There was a big package of support early on. Since then, we have announced a further package of support worth over £60 million to help get some financial support to those having difficulty affording food. Those are the two actions that we are taking to address this particular problem. I do not know whether David wanted to add something on the numbers.
Q240 Geraint Davies: Can I just ask about FareShare, as you have mentioned it? As you know, you provide some funding to ensure that FareShare takes surplus food from the farm gate to people who are very hungry. Can you commit now that you will continue to do that? We are told by FareShare that it costs about £5 million a year.
George Eustice: FareShare has always worked closely with organisations like WRAP, the Waste and Resources Action Plan, which is part of DEFRA, so there is quite a close relationship with FareShare and it does get some support. The specific reason that we gave them this additional one-off payment to deal with the coronavirus was that, at the peak of this, because of panic-buying and other difficulties, initially the supermarkets had less surplus food to redistribute. A lot of the food charities were reporting that not only were they having an increase in demand but supermarkets did not have as much available to redistribute. That was the reason for that initial fund. As things return to normal, we can expect some of those other donations of surplus food to kick back in, so it probably will not be necessary to sustain this year on year. This was very much a one-off payment to deal with the coronavirus crisis.
Q241 Geraint Davies: Can I just press you on this? If, as has been said by Henry, millions of people come off furlough, and if, as we know, we face a very difficult EU agreement or no EU agreement, and, as the British Retail Consortium has said, there may be problems with food supply, millions more people will be at potential risk of hunger. What plans do you have in place to provide millions more people with food? There are already nearly 7 million hungry; it will be way over 10 million, as it was before.
George Eustice: We do not think that there will be issues with food supply linked to the end of the transition period, because we have a withdrawal agreement in place and we are working on our plans to manage borders thereafter. There are no material concerns on that front. The issue is that, if we have an increase in unemployment as people come off furlough and potentially face redundancies in some situations, there is a benefits system in place that supports those people. That is the right way to support people in those circumstances. Indeed, during this coronavirus episode, some 2 million additional people were successfully enrolled into universal credit. That is the right remedy for those types of problems. Food aid certainly played a role in terms of an emergency response during this particular crisis.
Q242 Geraint Davies: The benefits system is not stopping 6.6 million people being hungry today, as we speak, is it? When you say that the benefits system will sort it out, it will not, will it?
George Eustice: The benefits system does work for those who get onto universal credit and, as I said, an additional 2 million have enrolled on that through this crisis. If your question is what the remedy is for people who may come off furlough and then, sadly, find themselves made redundant and unable to find another job, the answer to that is through the benefits system and through getting on to universal credit, so that they have the support that they need while they try to find another job. That is what that exists for.
Q243 Geraint Davies: Henry, I know that, in terms of the National Food Strategy, you are coming up with all sorts of plans. What should happen now about the 6.6 million people who are hungry, given that that number went up to nearly 11 million in the first three weeks following lockdown? You have already touched on the point that there may be a new shock from furlough and intimated that a trade agreement that is not working properly and a possible second wave of Covid infection could cause further problems. What should we do to deal with millions upon millions of hungry people and children now?
Henry Dimbleby: I am going to be setting that out in some detail in a few weeks’ time. I am currently working on those recommendations, so I will put that in writing once I have managed to look through the numbers in detail and set it out formally.
Q244 Geraint Davies: We are moving forward over the next few weeks. Even before those additional shocks, we have 6.6 million people who are hungry. I know that you do not agree with the right to food.
Henry Dimbleby: The right to food is not necessarily the correct way to do it, but our system has not been set up structurally to deal with this and it might require some other actions. In terms of what DEFRA did in taking the lead on food security, and Victoria Prentis being the lead, banging heads together with MHCLG and DWP to create the £63 million emergency fund and the fund for FareShare, there may be more of that work to be done.
Q245 Geraint Davies: If there is a big crisis, people simply do not have the money to buy food. It is not about the food but about poverty. If we want people to spend money on food, would the simplest solution be some sort of food vouchers, food rationing or something, just to stop widespread and growing hunger across all our communities?
Henry Dimbleby: I have a charity called Chefs In Schools, and we have been delivering, mostly in Hackney but around London, free school meals to our schools. People are getting nutritious free school meals, and we are going to be doing that throughout the summer holidays to many more schools in London.
What is important about responding to this crisis is that, when you have a system that is in chaos, effectively, and the usual structures are falling apart, you may well, as has already been the case for Government, require multiple responses rather than putting all your eggs in one basket.
Q246 Geraint Davies: Secretary of State, I am just concerned that approaching 10 million people who cannot afford to eat nutritious food and there needs to be some significant structural change in the benefits system to enable them to do so, does there not?
George Eustice: The difficulty with some of these things, and I know that this is often asserted, is that it is often also the case that it is less about the benefit. For instance, it can be people who are working but on low income and who have other episodes in their life that put a strain on their finances. Sometimes, those are the people, for instance, who turn to food banks. To address that, we continue to increase the threshold before they pay tax. We continue to increase the national living wage and so on in order to help those on the lowest incomes.
Also, if you look at the data on household spending on food amongst the poorest 20% of households, it has been remarkably stable for about 15 years now, at between 14% and 16%. It spiked at 18% in 2008 as a result of the financial crisis, before drifting down to 16% and staying there in a fairly stable way. It went down to about 14% two years ago, before ticking back up. Household spending on food has remained quite stable. We recognise that this particular crisis has thrown people out of their comfort zone and caused problems with their incomes and so forth, which is why we have announced two schemes specifically to target people’s inability to afford food.
David Kennedy: The £16 million for FareShare and other food charities and the £63 million local authority crisis grants were based on an assessment of all the evidence. We have heard about the Food Foundation surveys. We have looked at income and expenditure data. We have looked at different categories within the population who report that they are suffering from problems affording food. We have calibrated those responses to target those most in need, so we think we are solving the problem at the moment. We continue to look very closely at the impact of those interventions and the way things are developing.
Geraint Davies: Half the country has less than £500 in assets, so I guess they are very vulnerable to these shocks.
Chair: Thank you, Geraint. The point has been made. Secretary of State and David, I do not want you to answer this question, but the surplus food that went directly from farms is very good value for money. With vegetables and fruits, very often the retailers do not pick up the whole market and there is usually excess there, so it would be really good value for the taxpayer and good value in terms of getting good, healthy food out to those who most need it. I will just park that one there; we have drilled down on this question enough.
Q247 Rosie Duffield: How did DEFRA work with the Department for Education on the development of the free school meals voucher scheme and, in particular, on ensuring that the retailers that families were likely to use were included in the scheme—for example, those smaller convenience stores?
George Eustice: I will start on this, but David, who was much closer to some of those official-level discussions, might also want to come in. The school voucher scheme is a DFE scheme. It was linked to the free school meals entitlement. They operated the scheme and, for reasons of speed, set it up pretty much in the way that it had operated before. We identified quite early on that there was a challenge, in that it tended to be mainly deployed, and had been deployed previously, by two of the major retailers. Tesco was one and Sainsbury’s might have been the other.
Some of the other, smaller supermarkets—notably the Co-op, which was keen to participate and be involved—did not have the right kind of IT system on their tills to cope with the DFE voucher system. We had a number of conversations with DFE about trying to broaden the eligibility for some of the other stores, so that the vouchers could be used in a wider range of stores. Progress on that was made, particularly with some of the other supermarkets. I am not sure that we ever got a solution to the issue with small convenience stores, but David might be able to say a bit more.
David Kennedy: As the Secretary of State said, this is owned by the Department for Education, but it is part of our programme for food for the vulnerable, and we have worked very closely with them. We have seen our role as facilitating that relationship between the Department for Education and the supermarkets. One of the things we have achieved is that wider coverage within the supermarkets compared to the initial situation. It is something we worked closely on as part of that broader programme.
Q248 Rosie Duffield: I am thinking in particular of those constituents who said that they were finding it really difficult to use the vouchers. It was okay to download them and get them by email, but they found it really hard to use them online. Some were shielding, really vulnerable and did not want to go to shops, and they were finding it hard to use online even at Tesco, for example. Were you aware of that, or are you just collating that kind of feedback in case we need to use the scheme again in the same way?
David Kennedy: On the very specific question of use of vouchers online for the shielded population, that is something that we would have to come back to you on. On the more general set of issues that come up, they have featured in our conversations with the supermarkets.
Chair: Perhaps we could have that in writing.
Q249 Rosie Duffield: Have the Government focused too much on the service performance of the voucher scheme at the expense of ensuring that as many households as possible can access it?
George Eustice: I do not think so. You have to bear in mind that, with a lot of these things, the Government had to stand up quite a lot of new support schemes to deal with the situation. You can see this in everything that was done, whether it is the small business grant fund or the furlough scheme. Were these things done in a way that was perfect? Probably not, if you had the luxury of time. Just as with the furlough scheme the Chancellor rightly took the decision to stand the scheme up quickly and not to overcomplicate it, DFE took a similar position to stand up and run something that we have already got some experience of running, because that is the quickest way to get something stood up. The more you overcomplicate it and mess around with it, the greater the danger that there will be a delay and that you will not be getting any support to the people who need it.
We did a lot of work with the supermarkets around ways to pay for vouchers, particularly when we were looking at volunteers shopping for those who might have been self-isolating. A lot of work was done, for instance, on using loyalty cards, or cards that could be charged for volunteers to use, and other voucher schemes to support that. A lot of the retailers stepped up to help in that space and identified payment methods, so we were learning as we went along. However, wherever possible, we also stood schemes up that were familiar and that were run in a way that we had done things previously.
Q250 Rosie Duffield: David, do you have anything to add to that?
David Kennedy: The general experience, referring to what the Secretary of State said, is of standing up new approaches. I have led the standing up of the shielded approach for food, which is getting the boxes and the supermarket prioritisation. I have also led the non-shielded vulnerable approach, which was getting access to food for people, as well as food for people who cannot afford it. The challenge is standing new approaches up that we do not have very quickly, in order to reach as many people as possible. There is a trade-off there between design and complexity, and just getting something stood up that works for most people. That is my experience across the set of things that I have led. The situation was the same for the Department for Education; it is standing up an approach from nothing, where the urgent need was there, and you have trade-offs in finding the right balance.
Q251 Rosie Duffield: Finally, in hindsight, should the English Government have adopted the same approach as the Welsh Labour Government and left it to the local authorities to decide what worked best for their communities?
George Eustice: I would say that, in a lot of the schemes, that is exactly what we did. I will give you one example. When we were trying to identify the best means of getting volunteers, we had an army of millions of volunteers who had come forward on the GoodSAM app. When working out how best to deploy those and how best to ration the priority delivery slots that supermarkets had made available for vulnerable people, we contracted that out to local authorities. It was local authorities making the judgments on individual cases about whether it was more appropriate to send a volunteer round and to mobilise a volunteer to buy somebody’s shopping and take it to their door, or whether, in this particular instance, we should be a gatekeeper and authorise a priority delivery slot for an online delivery.
We established a system and a portal that enabled local authorities to log on and do that, and put that together quite quickly. We were very conscious throughout this that we did not want to cut across local authorities’ local resilience forums and other support that they have in place. Wherever we could, we plugged into that and sought to help support and enable it.
Q252 Rosie Duffield: Are there lessons that you have learned? Would you do things differently again?
George Eustice: Inevitably, if you look back, there probably would be things that you might have done a bit differently, but I have to be honest: nothing jumps to mind. It has been a very difficult episode, but I do not think there is anything so far where I have felt, “Gosh, we really got that wrong and we should have done it differently”. Have there been things that took a bit longer than we would have liked to have got going? Yes. Did we have challenges working out, having got all these volunteers on the GoodSAM app, how best to mobilise them? Yes. There were issues like that, where you sometimes could not quite work out how to pull these things together. Generally speaking, I do not have any huge regrets about how DEFRA conducted itself during this crisis. We acted in a timely, assertive way to deal with these unprecedented situations as they presented themselves.
David Kennedy: We have evolved our approach through the last few weeks. When you are standing things up very quickly, you will not necessarily get them right the first time. The question then is how you can change. If we think about working with the supermarkets on prioritising those people who do not have access because they are shielding, that approach developed over time and improved. We are still improving it now. There are a small number of people who have not been identified by the supermarkets in the shielded population. We are identifying them now and they will be served very shortly. The lesson is to be adaptive.
Going back to your free school meals example, the offer now is not the offer that we put in place a number of weeks ago. So that has evolved. We have talked about the wider coverage in terms of supermarkets and about different payment options that were developed. We have talked about local-level solutions that the DFE has encouraged schools to put in place for people who cannot access the supermarkets. It is about learning, being adaptive and continuous improvement, even in a crisis situation. We have put that into practice well. We will have to take a step back and ask what lessons we have learned from this and what we would do differently the next time around, and we will do that over the next weeks and months.
Henry Dimbleby: Can I say one thing on nutrition? The school meals vouchers were fantastic, and I am very glad that they have been extended through the summer holiday. The experience of dealing with it on the ground and the experience that different children are receiving is very different. Some children are being delivered food cooked by the school cooks who have not been working, with top-up food coming from FareShare, and getting really amazing boxes of high-quality nutrition. For other children, the caterers have been sending them less good stuff and, depending on how near you are to the store with the voucher, you get a different response.
One of the things that I am thinking about for this interim report is that we have the basics in place. We have that support of the free school meals through the summer holidays. How can we use the resources that we have at our disposal to make sure that we are getting as much nutrition to children as possible, not just calories, over the summer? I am going to be writing about that in a couple of weeks’ time.
Q253 Julian Sturdy: I just wanted to touch on food packaging for shielded people. I know, David, you touched on this a little bit already in some of your previous answers, but Age UK stated that people were having difficulties getting deliveries. It also said that the contents were not suitable in all cases. Given that local authorities have reported having to step in with food parcels for shielded people, would a less centralised scheme have been more successful, looking back at it now?
George Eustice: I will go first and then David can pick up. The reverse is true. I am conscious that there were some comments about some food deliveries that did not have a broad enough mix of products in them. Just to be clear, we consulted with the Trussell Trust, which has knowledge in this area, as well as dietary experts within the NHS to design what the package was. Around 26 different products went into the package. All of the centrally delivered, direct-to-household boxes had exactly the same things in them.
What happened in some cases, though, was that, as well as doing that in the initial days, because we could see that it would probably take a couple of weeks initially to get around to everybody who would need a food parcel, we just mobilised some food supplies to local authorities and local resilience forums and asked them, on a reactive basis, to drop food to people who needed it as a quick fix. That is where some of the boxes did not have a very wide range in them. It was just because we had dropped bulk products to local authorities and asked them to do it themselves. In some cases, they did not do a particularly broad mix of products, or perhaps they ran out of some. It was the ones that were centrally delivered that were uniform and consistent, and were delivered consistently.
We had regular data on parcels that they could not deliver, so sometimes they would leave it at the door and sometimes they could not get hold of people because they were out. Every week, there were cases where the box could not be delivered. I suspect some people said that they did not get their box, but maybe they were out, the doorbell was not ringing or some other such problem. You are bound to get issues like that when you try to do a mission of this nature. David, I do not know if you wanted to add anything.
David Kennedy: We were asked to stand up, with two weeks’ notice, an approach that would get essential items to hundreds of thousands of households. The only practical way of doing that was the national approach that we took, working with the two wholesalers—Brakes and Bidfood—that had the national distribution networks. We have delivered over 4 million packages now. Inevitably, there were some issues, which are relatively small in number, and we have worked very hard to address them. We do see the benefit of working at the local level, and we have made that the foundation of our approach for the non-shielded vulnerable—those who have limited access to food but who are not on the shielded list. They can go to their local authority and get volunteer shoppers. They can be prioritised by the supermarkets. We are working very closely at the local level.
Looking back, in the circumstances, given the job we had to do, the national approach was the only way to go. With much smaller numbers and more time, maybe you would stand up a local approach that was tailored to local circumstances, and that is something to think about going forward.
Q254 Julian Sturdy: The key issue there, then, was timing. From what you are saying, having two weeks to get this huge project up and running was what caused the initial problems in some areas. Would I be correct in saying that?
David Kennedy: I think so. On timing, the week of 6 March was when we were asked to stand up this whole approach. Before the end of March boxes were at people’s houses. The logistics of standing that up and going through quite a rigorous commercial process, which is what we had to do ensure value for money, were very challenging. As I said, it was the only practical way to do it.
We also did not think that this was an enduring solution. In parallel with the food boxes, we have worked with the supermarkets to prioritise people on the shielded list. Half a million on the shielded list have been prioritised and are ordering now, and that allows us to have the exit from the approach that we have had in terms of the provision of food boxes to people. They will now migrate and rely on supermarket prioritisation over the next weeks and months.
Q255 Julian Sturdy: You touched on the value-for-money side of things. How much has the food parcel scheme cost? Do you have an idea? George, it is probably back to you on that one.
George Eustice: I do have an idea, but I hope the Committee will understand that, while we are planning to suspend this at the end of shielding, we may need to go back to the market to negotiate a similar type of provision next winter. We do not know yet. I do not want to get into the precise figure per package, but I can describe what we went through.
There are three main components that made up the price: one based on the cost of the food going into the boxes, which we benchmarked against other public sector procurement costs and then negotiated down from there; an element linked to the cost of packing and handling the boxes, which was again benchmarked against similar operations, and there was a process of negotiation that was refined further as they improved the ergonomics around that; and a third component around the delivery cost, which again was benchmarked against similar activities. That is how we arrived at the approach to the costs, and negotiated it down from there.
Q256 Chair: Can we get an overall figure at all, Secretary of State, for the cost?
George Eustice: I do not think we have that now, because the scheme is still running, but we might be able to give some indication of that.
David Kennedy: Let us see what we do. If we gave you the overall figure, given that the number of boxes we have supplied is out there, you would be able to infer the price per box, which is commercially sensitive. We just need to be careful there.
Q257 Chair: My mental arithmetic is quite good, so we could work that out quite quickly. I understand that. Whatever information you can give us on this in writing would be useful, but we understand it is slightly commercially sensitive. I get that. See what you can do.
Q258 Robbie Moore: Thank you to the Secretary of State, David and Henry for your answers so far. My question moves on to protecting key workers over the last 12 weeks and going forward. We have seen the likes of the British Retail Consortium state very early on, back in April, that the Government advice was somewhat slow in being issued for workers involved in food industry and key sectors associated with food production. Should the Government have been quicker at issuing that guidance on PPE and social distancing to workplaces and businesses involved in the food sector, particularly processing and retail, over the last 12 weeks or so?
George Eustice: It is the case that there was a period, from memory, of about a week when we were seeking some additional guidance from Public Health England. However, to be fair to it, that was largely because we were bringing quite a lot of elaborate, sector-specific questions to them and asking them to try to find an approach that worked, that kept staff safe, that prevented the spread of the virus and that enabled certain environments to continue. For instance, in some meat plants it just was not possible to maintain a two-metre distance, so we worked out a way that people could be slightly closer than two metres if they faced away from one another. Working out how that would be achieved in practice took a bit of time.
All sorts of new problems are thrown up when you intervene with a draconian lockdown and all that goes with that. There were questions, for instance, around what happens with car-sharing arrangements, which were quite important in getting staff to work. There were questions about canteens. You are not allowed to consume food on a factory floor, so you have to have a separate area: is it okay to use that and, if so, what sort of provision should be put in place? There were a whole host of complicated questions that came to us from industry, and we recognised the complexity. We were working with PHE to try to get guidance to that agreed. It was important to give those businesses the confidence and the cover to know that the things that they were doing had been officially sanctioned. To do that and to it properly, it took a little bit of time to work through these things.
It was not a huge time lag, from memory, but there was a period of around a week when I know certain sectors of industry, particularly manufacturing, were asking for guidance and it took a little longer than we had perhaps hoped.
David Kennedy: This is a real success story in terms of us working with industry. The main vehicle for this has been the Food Resilience Industry Forum, which we set up at the beginning of this crisis. We had 100 industry representatives from the ops teams of various companies who joined us every morning, and that has now gone down to once a week. We have spent a lot of time focusing on social distancing and, more recently, test and trace, factory closures and local lockdown. These are all various live debates. Public Health England is with us on those calls and works with us outside those calls, together with working groups.
We have found solutions in days, not weeks, to all of these issues, which have allowed the industry to carry on functioning and continue to be safe, so we have found the right balance of safety and security of food supply. We continue to work very closely on these issues because some of them, as you know, are very live.
Q259 Robbie Moore: As well as the speed with which the guidance was issued, were there any challenges associated with the PPE products being distributed to that particular sector? We have heard a lot about this from the perspective of the NHS and care homes, but what about the processing and retail food sector specifically?
George Eustice: The important thing to note is that there was already pressure on PPE supplies, and the scientific advice was always that the benefits of facemasks were probably quite limited. In a food environment, there is another problem, which is that a facemask can become a hygiene risk. So there is a danger that, if a cloth mask worn by somebody falls into the flour bin, you then have a contamination problem. A further problem is that, unless used correctly, the facemask could transmit the virus. For all sorts of reasons, we were keen to avoid having to use facemasks, if possible, in those food environments. The scientific and medical advice at the time was that there was not much value in doing so.
The other thing that I would say is that we knew from companies like Mondelez and ABF, which had plants in other European countries, that where they had tried to mandate facemasks, in some cases companies could not source facemasks, which led to factory closures. There was quite a lot of anxiety from the manufacturers in particular that, if there was a requirement for facemasks, they would literally have to close down. All of these factors—the lack of efficacy in terms of controlling the coronavirus, the risk of other hygiene problems and the lack of availability—were weighed in the balance when we made these sorts of judgments.
David Kennedy: I would just add that food manufacturers and retailers have been able to comply with the guidance. The guidance was designed specifically for this industry to make sure that it was able to operate in a safe way. There have been a relatively small number of outbreaks in the news recently, but the killer fact for me is that, if you look at absences through the food industry, which we have very good data on, they peaked at the beginning of the crisis and went down as we got the social distancing and other measures in place. They have stayed at relatively low levels over the last few weeks, which, for me, is a sign of successful, safe operation while keeping the food supply for the country going.
Q260 Robbie Moore: As a last question from me, can I ask about your ongoing interaction with the meat processing industry? Public Health Wales have confirmed about 200 confirmed cases at a plant in Anglesey, as well as what we have seen in Germany, specifically to do with meat processing plants. I have also had conversations with the British Poultry Council. What reassurance are you giving to that particular sector now and going forward? How many conversations are you having with them to provide that reassurance that we do have the PPE there and that the guidance is adapting, if it needs to, in order to match the ongoing situation?
George Eustice: I am going to let David take this one because I know he has been directly involved in those conversations. I am familiar with what is happening, but do you want to take that, David?
David Kennedy: Yes. You have picked up on a really important issue. Let us not overstate the numbers though. Four or five factories have had to be closed. Most of those have been voluntary; only one was forced to close. There have been a few more outbreaks, but we are talking about a population of 5,000 food manufacturers with over 50 workers in England, and 8,000 factories across the UK. That is not to diminish the importance. This has been my focus, with my team, working with Public Health England, the FSA and the Health and Safety Executive over the last week or so. We already have new guidance out to cover these situations in terms of what happens when there is an outbreak. Operational protocols will be published, if not today, tomorrow, about how guidance should be implemented by the various authorities.
I have put together a taskforce that meets three times a week this week and next; let us see what we need to do after that. It has senior people from the relevant organisations to make sure that this guidance and the operational protocols are implemented properly. That is me working with, again, Public Health England, the FSA and the Health and Safety Executive. Things seem to be working well. This happens at the local level. It is the teams from those organisations working with the local authorities. As I say, it seems to be working well. They liaise with the national organisations as well, but I have put this taskforce together, just so that we are completely on top of it. We do not want factories being closed unnecessarily and, if there are any gaps in the guidance, we will know about those straightaway and will work with Public Health England to make sure that they are addressed.
Q261 Derek Thomas: How is Pick For Britain going?
George Eustice: It has been a success. We recognised very early on, way back in March, that the seasonal labour that normally comes here probably would not come, or certainly would not come in the same numbers, and that, although around a third of the EU migrant labour was already in the UK and had been involved in the winter harvest and picking daffodils in places like St Ives, we would not have the numbers that we needed. We were working with industry from March. It has been a great success. We set up a portal that was run by AHDB and, generally speaking, during the peak month of June, most of the large employers, such as Geest and other soft-fruit producers, were reporting that around a third of the staff they have had this year have been British, some of them furloughed and some of them unemployed. The remaining two-thirds, generally speaking, have continued to be migrant labour, either because they were already here or because they managed to travel here.
We have also seen instances in which Poles and Lithuanians who had perhaps settled in the UK and were working in the hospitality industry, but maybe 10 years ago were picking strawberries or flowers and working in the fields, turned their hand to take part in the harvest. We have not had reports of significant problems with businesses getting the labour they need; indeed, when I asked whether they wanted us to give this a further boost, the feedback from industry was that this had been a success and had contributed around a third of their labour, but they did not need any further people at this point.
David Kennedy: Some of the recruiters and growers have asked to be delisted from the website because they have met all of their need for workers for the whole season. Again, that is a sign of the success.
Q262 Derek Thomas: When this kicked off, the Secretary of State will be aware of businesses in our area of south-west Cornwall that were very frantic about this. You are right that it has been a success. The concern now is that some of these people were furloughed and are going back to work. Has that presented itself as a problem, or will that not present the challenge that I think it may?
George Eustice: We have considered this. If the furlough scheme had ended, for instance, at the end of the July, there could have been a pressure point in August or September. We have been working on plans to try to encourage more students to turn their hand to this, to help fill the gap as furloughed staff return. In the event, a smaller proportion of the people who have responded to this challenge than we expected were furloughed. Quite a lot of them either were unemployed or were students, so we do not know that furloughed staff returning to work is going to present any particular challenges at this stage. We are also now, of course, past the peak strawberry period. The last week of May and the month of June is the peak, and it starts to get slightly quieter from July onwards.
Q263 Derek Thomas: While we would never want the coronavirus in the first place and we would not want it back, it could not have come at a better time to demonstrate the value of our food production and how important these jobs are. Also, given that we are told that there will be increased unemployment, are you fairly hopeful, Secretary of State, that we will begin to attract local labour into these jobs much more long-term, so people find a career and a satisfying job in the kind of work that previously we have relied so heavily on imported labour for?
Moving on from Covid, when will the Government be evaluating the seasonal workers pilot, which obviously is about foreign labour, and clarifying how many seasonal workers will be allowed in 2021? Are the two connected? In terms of the success of Pick for Britain, does that change the conversation regarding the seasonal workers allowed into the UK next year?
George Eustice: There are a number of points in there. I will try to be as brief as I can. First, very little good is going to come from a crisis of this nature, but if something comes from it, I hope that it is that people will value, appreciate and perhaps not take for granted those who are in the food sector and putting food on our tables. There has long been the cliché about ending up stacking shelves in supermarkets. People can now see the jobs that really matter at times like this. If we can rekindle and value the people who are working in the food supply chain, that will help encourage more people to choose it as a career.
There is a second issue around seasonal labour. One of the things that we have learned is that, although average productivity among the British workforce was lower than for those who were experienced, it was not so low that the thing did not work. There has been the refrain from some farmers and growers in recent years that people just will not do this work, but we discovered that they will do this work and that a British workforce can be part of the mix.
On your final point, whatever happens, even if we had higher unemployment and more British people doing this work in future years, we would probably still need to complement that with an element of migrant labour under some kind of seasonal worker scheme. It is too early to evaluate the scheme for this year, but we will be in dialogue with the Home Office about what to do next year.
Q264 Derek Thomas: Thank you, Secretary of State, for the contribution you made to the Committee on Climate Change report launched last Friday, which is very relevant to this in terms of a green, resilient recovery from coronavirus. David, is there anything you want to add to that?
David Kennedy: It has been well covered. We need a balance going forward of domestic workers and foreign workers. The pilot scheme and scaling that up next year will be important, but we will be thinking more about what the right balance is. The answer is that it needs both.
Derek Thomas: The opportunity is certainly here now.
Q265 Dr Hudson: Thank you very much, Secretary of State, Henry and David for being before us, and for your answers. It has been great to have you.
I want to move on to the reopening of the food service sector. All aspects of the economy have been hit very hard in this crisis, but some sectors, such as tourism and hospitality, are going to take longer to recover. That is why many of us are still calling for additional targeted support for those sectors that are going to take longer to recover. Stakeholders such as the Food and Drink Federation have expressed concerns that, as we now move to restarting the hospitality and food service market, this could be negatively affected by the inability of the supply chain to restart—so upstream of that. Secretary of State, what support are the Government thinking about potentially providing to food and drink suppliers to the hospitality side of things until the sector starts to recover, which may well be weeks or months down the line?
George Eustice: There are a number of issues here that we have been looking at. The first is that we have been closely monitoring the food wholesale sector, where the loss of the service trade has affected certain businesses quite badly. Our assessment so far is that, although there has been some financial distress, the largest players have managed to cope by furloughing staff and through increased sales to convenience stores and so forth, and will be well placed to restart. There is a bit of fragility on some of the smaller ones, but they have weathered this difficulty better than we might have expected. We have been watching it closely.
For food manufacturers, it will be a further return to business as normal, so we think that they will be fine. The concern that they have is around credit and credit insurance. One of the concerns that the big manufacturers and wholesalers have is that they may restart delivering food to pubs, restaurants and hotels, and end up with quite a large list of debtors and find lots of businesses going into administration. That is their greatest concern around the restart. The Treasury and the Chancellor have been looking at a package to try to help support the credit insurance market, so that those manufacturers can get the cover that they need.
The final thing relates to the food service sector itself. Pubs and restaurants are, by definition, social venues. People go to the pub to socialise, and it is inevitably the case that trying to reopen them is the most challenging piece of the jigsaw. It is why it has been left till last. The Prime Minister has set out an approach that enables this to happen, with some change to the distancing guidance, but with other strict measures put in place and the development of test and trace. All of these things will help ensure that we can make a success of that reopening. It is crucial that we embark on that journey and work through the challenges that will present themselves because, unless we allow this sector to have something of what is left of this season, we are going to have real problems with it going through the winter.
Q266 Dr Hudson: That is really helpful. It is encouraging to know that we are thinking about different stages of the supply line all the way through to when these businesses open up, but that leads into my next question. As you have said, Secretary of State, there are challenges for these businesses opening up. They are not going to be able to turn the tap on and customers will suddenly arrive on day one; it is going to be a phased reopening. Some of the businesses in this sector may well have significant challenges in terms of the reopening and in terms of adapting to the new measures that are coming out, including putting new signage in, as well as interacting with the NHS test and trace. There are significant logistical challenges on that side of things, so are the Government thinking about support to help with that reopening challenge?
George Eustice: In terms of reopening, the best support that we can give is to have sufficient flexibility in the guidance that businesses can do what works in their particular circumstance and not to be so prescriptive that there is a one-size-fits-all approach when different venues will have different challenges. Equally, however, we need to have something that is tough enough and enforceable enough that we can hold everybody to account.
This next phase, which is the most different, will only be a success if, alongside it, people abide by the social distancing requirements that go with it. If they throw all that out of the window and just reopen as if it is business as usual, we will have a difficulty. Matt Hancock and others have been very clear about that. It is difficult, but the best help that we can give them is support in navigating a way through this and helping them to do it safely, To help them come back in a tentative and phased way, the furlough scheme has been revised to allow them to have some support, such as part-time furloughs and so on, so that they can bring their staff back in phases as well.
Q267 Dr Hudson: That is really helpful. As a final follow-up to that, Secretary of State, do you feel that the Government are there, a bit like slip-fielders in a cricket game, ready to be agile to step in and support, if that is needed? You have anticipated a lot of the challenges, but perhaps they are already there—to be agile and ready.
George Eustice: This has been an extraordinary episode all round, and we have faced new challenges on a weekly basis. Working out how to chart a course to allow the gradual and tentative reopening of pubs and restaurants is the final piece of the jigsaw and it has its challenges, so there will, of course, have to be a somewhat iterative approach in terms of monitoring this and how we react to it.
David Kennedy: That is how we have approached the whole food system over the last four months. This is an evolving programme. Challenges come up and are surfaced by the industry—social distancing, test and trace or whatever. We work together and we solve those challenges, and the same will apply to the coming months as well.
Q268 Chair: How much have you learned from the pandemic about how to manage future disruption to food supply, especially if there is no agreement with the EU by the end of the year? Secretary of State, we have been quite surprised at how well imported food came in during this crisis, so are you concerned that, if there was no agreement with the EU, we would be unable to get food in? Would there be too many import or export controls, whichever direction the food is travelling in?
George Eustice: Our lesson from this is that our food supply chain is remarkably resilient. There were some supply issues on particular fronts. There were concerns at one point about vitamins that go into the fortification of bread. There was a shortage of glycerine at one point, which is a preservative. Remarkably, although we were worried about this and watching it, the transport of fresh fruit, salads and veg from Spain continued, largely uninterrupted. Despite all the problems that those countries were going through, the food supply chain right across Europe kept going. There were particular issues with spices coming out of India. Places like India and Pakistan were worst affected, and that had impacts. Generally speaking, we are more confident than ever that we need not worry too much about the end of the transition period.
Q269 Chair: Are you confident that we will be able to get food coming into this country, whatever the agreement is with Europe?
George Eustice: Yes, I am confident.
Chair: You are now on record.
Q270 Barry Gardiner: This is probably best directed at Henry Dimbleby. It picks up on something that Tim Benton said to us, highlighting the tension between resilience and efficiency of the supply chain. We have seen it with Covid not just in food but also in terms of hospital beds— having functional redundancy and excess beds. How will that tension between efficiency and resilience of the system play into the National Food Strategy?
Henry Dimbleby: That is a fantastic question. The reason why the food supply chain responded so well to this crisis is that the restrictions on activity were Government-led. Government decided to close down parts of the economy and, therefore, Governments around the world were able to decide to keep food moving. We had enough food and it continued to get to where it wanted to be.
A climate food crisis, where there is not enough food, is a very different kind of crisis. In that context, across a whole range of things, we need to be thinking about where we want to have surplus. That surplus could be in what we grow. It could be in our soils. It could be literal stockpiling by Government. The way the food system runs at the moment is financially most efficient. The Government are already on record saying that we are now looking at those areas of our country’s purchasing and resources where we might want to favour something that requires investment to make it a bit more robust. That is absolutely something that I will be looking at for the strategy.
Q271 Mrs Murray: First of all, Secretary of State, could you give us any idea as to when the Fisheries Bill will make its appearance in the Commons, having completed its passage through the Lords this week?
George Eustice: It will be presented on Thursday and I would then anticipate that we would get a Second Reading before summer recess, although we do not yet have confirmation of that. The major stages will then take place during the autumn.
Q272 Mrs Murray: That is useful for us to know as a Committee as well. I notice that the questions I have talk about no deal, but on fisheries I am going to rephrase the question. When will the European Commission accept the fact that the UK is an independent coastal state and the fact that you, as Secretary of State, will determine the access that European vessels have to our waters on an annual basis?
George Eustice: The European Commission already understands that. They do understand international law, so DG MARE, the directorate that deals with fisheries, understands the legal reality that the UK will be an independent coastal state determining access and sharing arrangements on an annual basis. That is understood. For reasons that people will understand, some member states are reluctant to see too much of a change from the status quo, so that is coming out in their current mandate.
Q273 Mrs Murray: How will we be able to ensure that the deal proceeds? Is there going to be any room for compromise as far as our position as an independent coastal state and accepting the status quo goes, or are you absolutely determined that, if we have to, we will say to the European Commission and the other member states, “We are sorry, but we will not accept a continuance of the current arrangements and I am afraid we will just exclude you”?
George Eustice: The Prime Minister has been very clear about his negotiating approach to this, which is that we cannot have the European Court of Justice second-guessing our laws. We are not seeking regulatory alignment. So-called level-playing-field provisions and fisheries have been some of the sticking points in this discussion. As you will know, the Prime Minister has also said that we are going to have an intensive period of discussion during July, and my understanding is that David Frost and his team are engaged in those discussions as we speak this week. There is an intensive effort on both sides to see whether we can break the deadlock that has existed to date and get a sensible agreement on a free trade agreement and, indeed, a future fisheries partnership, which was envisaged to be in place by July.
Q274 Mrs Murray: Is there room for the UK to compromise in any way? I am looking particularly with regard to perhaps the position of the Channel Islands and the special relationship that they have with France, especially smaller islands like Sark landing into the smaller ports in France.
George Eustice: As is often the case with Crown dependencies, the Channel Islands operate in a slightly different way, in that the fishermen in both Jersey and Guernsey fish against the UK quota allocation, but they also have their own neighbourhood agreements bilaterally with France, which cover access arrangements. It is a complex area.
On your original question, we have always said that we would be seeking a partnership agreement with the European Union on how to approach fisheries, and that would be broadly modelled on the Norway approach. We are not asking for anything novel or exceptional; we just want to be like Norway in the context of fisheries. That has been our guiding principle throughout.
Q275 Mrs Murray: Finally, if there is an Australia-type deal rather than a Canada-type deal, how will the Government help exporters and processors who could be affected by the resulting tariffs, customs controls and border delays in accessing their most important market? I feel that the tariffs should not affect UK fishermen, because the market demand will still be there. I find it hard to believe that countries such as France will impose tariffs that mean their own consumers pay a higher price, but it would be nice to hear from you what your thinking is on this.
George Eustice: The general message from the UK’s leading processors, while they would prefer an agreement that meant there was no need for tariffs, has been not to sell the catching sector out on their behalf, in that we should take back control of our waters and manage the resources within them. When it comes to tariffs, the main species that we export are shellfish, where tariffs are typically around 8%. While unwelcome, it does not dramatically change the economics of exporting and would come out as increased consumer prices in Europe. We have a very big export market for farmed salmon as well, where the tariffs are usually 2% to 3%, so not prohibitively high.
Q276 Mrs Murray: Has your Department looked at our opportunities in other markets? I know we import a smaller proportion of fish into the UK than we do from countries such as Norway, Iceland and the Faroe Islands. With regard to our exports, has your Department looked at opportunities outside of the EU to perhaps fill the gap?
George Eustice: As we leave the EU, we are looking at trade agreements and opportunities elsewhere in the world. As you will know, it has always been the case that we import a lot of the fish that we eat, because of our taste for cod in particular and the history of the long-distance fleet in Icelandic waters. We now import that from Iceland and Norway, and we have tended to export the fish that we catch—principally, mackerel, where we are global exporter, and shellfish, with all sorts of trade such as whelks to South Korea. There is an entire international trade that has developed over many years and it is a global trade.
Q277 Mrs Murray: Secretary of State, could you envisage the EU having to introduce a round of decommissioning or effort limitation in the same way as the three or four schemes that the UK fleet has had to suffer since 1972 because of the loss of resource? We had that forced on our fleet, which is now a ghost of its former self. Perhaps the European Commission will have to make sure that member states bear their share of the burden in terms of the loss of fishing opportunities in UK waters. Do you agree that that could possibly be the case?
George Eustice: It would be for the European Union and the European Commission to decide their policies. One corollary of leaving the European Union and controlling our own destiny is that it will not be for us to tell others what to do. We are in a sensitive phase of negotiations, so as much as you have invited me to say something that would not be helpful, I am going to resist that temptation. It will be a matter for them. We are very focused at the moment on trying to get an agreement.
Q278 Mrs Murray: I can say that, but let us put it a different way: will there be opportunities for the United Kingdom fishing fleet to grow and take advantage of the situation that it finds itself in when we take back control completely—we have left the common fisheries policy—and become an independent coastal state at the end of this year?
George Eustice: Our White Paper that was published a couple of years ago was very clear that we wanted to leave behind so-called relative stability, which is an unfair sharing arrangement that means we really catch only half the fish that are in our own waters, and to move towards zonal attachment as a fairer, more scientific sharing arrangement. That is our approach and one that will create opportunities for parts of the UK fleet.
Mrs Murray: Chair, I am sure my colleague Derek, as well as Barry, will have questions on this because we have massive fishing interests in Cornwall, but I have taken more than my share of time. Thank you very much to you and the Secretary of State for allowing me to do that.
Q279 Chair: Secretary of State, it is no secret that the EU wants to link a trade deal to access to fish. Do we have the reassurance from you and the Government that that is not going to happen? We want our fish back, do we not?
George Eustice: We have been clear that we will be an independent coastal state, and the Prime Minister has stated many times that we will decide, in annual negotiations, who has access to our waters and on what terms, and sharing arrangements that flow from that. We do not see them as linked, although, if we get a final future trading relationship and partnership with the EU, it is likely that you would have a partnership agreement on fisheries alongside any FTA that might be agreed.
Q280 Chair: That was not a yes or no answer, Secretary of State. It is a little more complex than that, but are we going to give access to our water for the trade of fish? That is the question—yes or no?
George Eustice: We see them, as I have said many times, as totally separate issues. There is a trade discussion and there is a discussion on fisheries management. They are separate elements.
Q281 Dave Doogan: It is fortuitous because it is an extension of that. Secretary of State, we have seen, with Covid, what happens to local fleets, particularly, as you pointed out, in terms of shellfish and inshore fishing, when the European market vanishes. It has been devastating. How do you intend to retake control of the grounds for fishing fleets belonging to the United Kingdom and, at the same time, reconcile the extremely important nature of the EU market to the fish that we will, in turn, be catching?
As an extension to that, it is a challenge for your Department and for your negotiators to reconcile the sometimes competing interests of the different sectors, whether that is inshore, shellfish, whitefish, distant fleet or processing, to get the best outcome. How do we do that?
George Eustice: The shellfish sector has been particularly badly affected during the coronavirus pandemic, first because it exports a lot to the European Union and markets such as France and Belgium, where the lockdown happened earlier, so it was affected earlier. Secondly, both in Europe and here, a lot of the shellfish that is harvested goes to the food service sector. For those combined reasons, it was particularly susceptible.
Of course, looking forward, once we have charted a way out of the coronavirus difficulties, you would not have a total closure of Boulogne market and a total closure of the food service sector in France. You would, instead, be in a situation where, in the worst-case scenario, some tariffs may be applied to crabs and other shellfish that were exported, and 2% to 3% tariffs, potentially, on the salmon that might be exported. It is a different magnitude of problem. With coronavirus, it has been a total shutdown, with major impacts. In the event of an Australia-style agreement, you are talking about some modest tariffs being put in place.
Q282 Barry Gardiner: Can I just urge you, Secretary of State, to stay strong on your negotiating position? It is the right position in terms of annual negotiations on the basis of zonal attachment. Looking at the sort of compromises that may have to be made in negotiations, one of the things you have touched on is the seafood industry. Of course, the introduction of non-tariff barriers, which could happen without an FTA, could be devastating on the seafood industry in terms of environmental health certificates being required.
The specific concern that I have is in relation to the scientific basis of setting total allowable catch levels on the basis of MSY—maximum sustainable yield. Recently, the Department confirmed that it would not be seeking to deviate from MSY as the basis for setting TACs, but we have heard from some witnesses that we should exceed MSY for some choke species in order to be able to continue to harvest the other species in mixed fisheries.
Can you confirm that, whilst it is correct that not all species can be fished at MSY, it is a mistake to regard MSY as a target when science regards it as an upper limit, such that the stock that can cope with the lowest level of mortality becomes the controlling factor and, if fishers want to continue to catch other species in mixed fisheries, they must adopt more selective gear accordingly? I really want your assurance that this is not an issue that you will give way on in negotiations as they go forward.
George Eustice: Very briefly on your first point, we did a lot of work on export health certificates and catch certificates. The French authorities had also put in place a procedure that would have enabled paper to be checked at Boulogne market rather than at the border, so quite a lot of groundwork was done on that non-tariff-barrier issue.
On your specifics around mixed fisheries and MSY, I very much agree. The UK, through Cefas, our fisheries science agency, has led the work on this. Carl O’Brien, our chief fisheries scientist and also the deputy head of ICES, has pioneered all the work on mixed fisheries analysis. It is precisely as you say: if you have three species and you are targeting one of them, you have to have MSY ranges and try to pitch the catching levels for each in such a way that it does not wipe out the most vulnerable species. It is not always easy. We have constant problems in the Celtic Sea with whiting, cod and haddock, but it is an approach that we have pioneered and continue to advocate.
Barry Gardiner: I really appreciate that. Coming from you as a former fisheries Minister in the Department, I know that you know what you are talking about, so that is really helpful.
Q283 Chair: Secretary of State, before we leave this, at what stage are you, as Secretary of State, and the Government, going to be able to promote more British fish and more British food—dairy, meat and vegetables? When can you go on being very proactive about Buy British? I know that lots of people are out there asking, “Why are we not hearing from the Secretary of State about our British food?” When can you be more proactive about that?
George Eustice: We have run and supported a number of campaigns during this coronavirus epidemic. We worked with AHDB on a dairy campaign. We were in discussion with supermarkets early on about putting steaks and other red meat on promotion, for instance.
Chair: We want to hear it from you, Secretary of State.
George Eustice: Let me take this opportunity here and now to say that I very much hope people will buy British food, as I do, at every opportunity.
Q284 Chair: Very quickly, Secretary of State, on the Environment Bill, where is it and when is it going to come forward? Within the Environment Bill is the Office for Environmental Protection, which is very much there to protect our environmental rules, our air quality and all of these things as we leave the EU. We are just a bit concerned that the Environment Bill is not going to be up and running and that the Office for Environmental Protection will not be ready by the time we have completely left the EU. Where do you see the Environment Bill and the Office for Environmental Protection?
George Eustice: The coronavirus has affected the parliamentary timetable. Parliament has been shut down for a period. Emergency Bills have come forward. There will probably be other legislation as well, linked both to the end of the transition period and also to further action post coronavirus. It has affected the parliamentary timetable. It is still possible that the Environment Bill will resume Committee stage before summer recess. I suspect it is potentially more likely that it will be September, but that is not yet finally decided and will be a matter for business managers. We are keen to resume progress of the Bill as quickly as possible.
The other thing that I would say is that, just because the legislation has had a setback, for these obvious reasons, it does not mean that we need to ease off on the preparation for all the things we intend to do with the Bill. Consideration around the recruitment process for the chair and the board is continuing at a pace.
Q285 Chair: Is this for the Office of Environmental Protection?
George Eustice: That is right, yes—the chair of the OEP. We are giving consideration to that and working on potential candidates, and we have thoughts on that. We are also commencing the work on the development of the targets, which is a crucial and central ingredient of the Environment Bill. We want to have those targets published by October 2022. Some engagement has already been started with some of the environmental stakeholders on what those targets should be and how we should develop them.
Q286 Chair: We very much welcome that, but I still need to press you on when the Environment Bill will finish its stages and receive Royal Assent. Have you a guesstimate? What is your best idea of where it might be?
George Eustice: I am afraid it is too early for me to be able to say definitively, simply because, although we want to resume Commons stages as quickly as possible—and it is still possible that that will be before summer recess—there is also a possibility that it will not be until September. More importantly, as you will know, their Lordships will not be rushed on these matters and there is quite a lot of legislation in the House of Lords at the moment. Business managers there have to prioritise things and work out what needs to be done without fail by the end of the year versus what would be nice to do by the end of the year.
Q287 Chair: I have one final question on the dairy hardship scheme, which I very much supported you, as did many members, in setting up. It is fair to say it is having some teething problems. To what extent are you reviewing the situation? There are quite a number of farmers in the Cotswolds and other places who just fall out of the scheme by having 24.5% losses and it is set at 25%. Are you looking to review that? If we have a meeting on 28 July, we will probably look into this scheme. I am just wondering where we are on it.
George Eustice: It is difficult. When you design a scheme such as this, which has to be simple so that you can get it out the door and not have too much complexity, you do then have to draw the line somewhere. The initial proposal that I had put to me was that it should be perhaps 30% or 40% losses before there was a scheme. The NFU said it should be 20%. In the end, I said, “Let us pitch it at 25%”, so I had already moved some way from the original proposal.
Of course I completely understand that those who are at 24% will then say, “I have just missed out”. There is a problem with going further along the line, because the closer you get to zero, the more you get into the realms of commercial risk, which is a feature of business that everybody has to contend with. It is a difficult one. You have to draw a line somewhere, and that is where we drew it. If there are issues with people applying for it, we will keep it under review.
Q288 Chair: Thank you, Secretary of State. We probably will be looking at that, so thank you for that answer. It did take quite a long time to get this scheme going, so I am a little bit surprised that we could not have taken this into consideration before we got the scheme up and running, but we will talk about that again later. I do not know if you want to add anything.
George Eustice: Not at this stage, no, but I know that Victoria Prentis has been very involved in the specifics of the scheme too. I am sure that, if you are going to have an inquiry on it, she would be more than happy to come and talk you through it.
David Kennedy: I have a team looking in detail at the applications as we speak. The applications came in last week and this week, and we are assessing them and asking the questions that you have just asked us.
Q289 Chair: When you say you are assessing them, is that with a desire to perhaps make one or two changes, David? That is a tantalising answer.
David Kennedy: It is just to get a proper understanding of the situation of the farmers who have applied.
Chair: We will wait and see whether we call you for evidence, and then we can get some detailed answers. Thank you very much to the Secretary of State, David and Henry. We have had a very good session. It has gone on a little bit longer. We have dealt with fisheries, with the Environment Bill and with the dairy scheme, and we have done a lot on Covid-19 and the food supply.
The evidence we have taken generally in this inquiry has shown that the Government have stepped up to the mark very well on many occasions, but there are issues with getting food to poorer people. Getting food to those who really cannot afford and get food is an issue that we need to pursue even more. Generally speaking, Secretary of State—I do not often give you a compliment—the Government have dealt with it pretty well, but there are a few lessons to be learned. This afternoon’s session was very successful. We thank you all for coming.