Response from the Welsh Agri-food Partnership Organic
Strategy Group
prepared by Organic Centre Wales, University of Wales ,
Aberystwyth , SY23 3AL
to the Welsh Assembly Government consultation on
Review of the agricultural and horticultural levy bodies
http://www.defra.gov.uk/corporate/consult/levy-bodies/consultation.pdf
3rd February 2006
Background
The
Organic Strategy Group was formed in March 1999, one of the four strategy
groups and four regional groups forming the Welsh Agri-Food Partnership, which
are responsible for steering the implementation of the sector plans for Wales.
Since
its formation one of the primary roles of the Organic Strategy Group has been
the implementation of the first Welsh Organic Action Plan that was published in
March 1999. Many of the aims of this first action plan have been fully or at
least partially achieved. A Second
Organic Action Plan was launched in 2005.
Organic
Centre Wales (OCW) was established in 2000 with funding from the Welsh Assembly
Government as a focal point for the dissemination of information on organic
food and farming to producers and other interested parties in
Introduction
Organically
managed land in January 2005 accounted for just over 4% of the
This response has been prepared on behalf of the Agri-food partnership Organic Strategy Group; we have restricted our comments to those we see as particularly affecting the organic sector.
Organic Issues
- We
would like to see some progress towards a fairer apportionment of levy
funds contributed by organic producers going towards specific organic
research/development, promotional and other work. Recent Defra statistics indicate
4.1% of
- The organic sector is keen that promotional work relating to organic food and farming is included as an appropriate activity for levy bodies, and indeed that it should be given higher priority than it has been in the past. At the European level, organic farming under Regulation 2092/91 has equivalent status to PGI/PDO measures and is placed firmly within the EU’s suite of quality measures[3]. In addition, the European Commission’s Action Plan for Organic Food and Farming[4] has a specific action point to increase promotion activity for organic food at EU level. Levy funds provide essential match funding to enable the draw down of these European promotional funds targeted at organic farming, and could build on new Defra initiatives in this area. (Consumer information on organic food is also a key action of the Welsh Organic Action Plan 2005-2010).
- We would like to see increased marketing and general promotional activity by the HDC, given the widely endorsed nutritional benefits of fresh fruit and vegetables and the reduction in food miles of local production, and the need to educate consumers on preparation and uses of vegetables.
- We would like to see a greater focus on organic production and processing methods in research and development activities. Given the increased focus on sustainable, environmentally sound, high animal welfare systems of production which use fewer pesticides an organic approach included in production trials will have a great deal to offer the conventional sector, as well as taking forward organic methods and assisting organic producers. There is a significant opportunity for tie up with the Defra Organic Link-funded research programme.
(i) Retention
of the Statutory Levy (paragraph 5.2)
The Reviewer has concluded that
although the case for retention of a statutory levy is stronger in some sectors
than others, it should nevertheless be retained for all sectors, subject to
some changes in the current arrangements.
Do you agree?
No comment
(ii) Continuation of Processor
Levies (paragraphs 5.23-5.25)
The report notes that the
arguments about whether the levy should continue to apply in relation to
processors/dealers in some sectors are finely balanced and so the current
arrangements should continue, but kept under review. It is proposed that the meat processor levy
should continue and that the general and promotional levies should be
combined. Do you agree that
processor/dealer levies should continue for potatoes, meat and cereals? If so,
do you agree that the meat general and promotional levies should be combined?
We agree in principle that processors and
dealers should share the burden with producers, and hence that the levies
should be combined.
(iii) Basis for calculation of
levies (paragraph 5.26)
The Reviewer has proposed that value-based
arrangements should apply to all levies and so in respect of potatoes, meat and
cereals this should be based on turnover.
It is also suggested that there should be a consistent approach to small
producer exemptions. A “Fresh Start” is
recommended to calculating the levies so that the levy rate is directly related
to the strategies for supporting the respective sectors. Do you agree with the value based approach
for all sectors and consistency for small producer exemptions? Are you in agreement with the “Fresh Start”
approach to calculating levies?
This approach seems reasonable, but if
implemented it would be even more important that the appropriate proportion of
funds are re-invested into the organic sector.
This is particularly for organic livestock which may have very high
value per beast, but also carry higher production costs.
(iv)
Activities and
Priorities (Box V.1, page 87)
The Reviewer has set out those
activities she considers are always appropriate for levy bodies such as
research and development, benchmarking etc; those that may sometimes be
appropriate, such as provision of market information; and those that are
inappropriate, such as general promotional campaigns. Do you agree with these classifications,
in particular the activities deemed inappropriate?
In addition to our specific points about organic food promotion work above, which we doi consider an appropriate activity for levy boards, we also consider that there is merit in general promotional campaigns for fresh fruit and vegetables; therefore we would like to see increased marketing activity by the HDC, given the widely endorsed nutritional benefits of fresh fruit and vegetables and the reduction in food miles of local production, and the need to educate consumers on preparation and uses of vegetables.
(v) The New Model (Paragraph
5.37 and 5.52)
The report
contains recommendations for a new structure which would entail abolishing the
existing five levy bodies and setting them up as separate sector companies,
wholly owned subsidiaries of a single overarching Non Departmental Public Body,
Newco, which would be accountable and responsible to
Ministers for collecting the levy. Newco would also
have the power to wind up SectorCos and establish new
ones, but would be required to take account of levy payers’ views. In order to improve accountability, it is
proposed that levy payers should have the right to trigger a vote on whether a
particular levy is abolished or a new one established. The SectorCos
would be closely involved in setting the levy, receive net proceeds and take
detailed decisions on sectoral activities and
priorities. Separate companies are proposed for milk, cereals and oilseed,
potatoes, horticulture, pigmeat and English beef and sheepmeat. In respect of
The report proposes that the
implementation of the New Model should be completed by the start of the 2007/8
financial year and that the project should break even within two years,
delivering a net saving of in excess of £913.000 per annum thereafter. Do
you agree that levy payers should have the right to trigger a vote whether a
particular levy/or SectorCo is abolished or new ones
established? Have you any views on the proposed arrangements for sector
companies? What are your views on the proposed new model, its associated cost-benefit
analysis and the recommended implementation timetable?
We do not have strong opinions over the
proposed new structure, except to note that it may be helpful to have an
overarching body to ensure a strategic commitment to the development of the organic
sector and to the allocation of an appropriate proportion of levy resources for
this work.
(vi) Welsh Considerations
The report suggests that if it is
decided in
We would like to see an improvement in
accountability of HCC, particularly to the organic sector, which currently has
no place on the board. The Unions do
have organic members, but rarely seek to represent their interests at high
levels. As an NDPB, there would at least
be a route for farmers and producers that are not members of farming unions.
We have a slight concern that direct
accountability to Welsh Assembly Ministers may provide opportunity for
political lobbying, which, as noted in Box V.1 of the consultation document
would not be appropriate or desirable.
In paragraph 5.26, the reviewer suggests that in relation to meat levy monies it would be preferable to distribute the levy monies to devolved bodies on the basis of where animals originate and are tended, rather than where slaughtered. Do you consider there is merit in further investigation into this issue?
We are very positive about this suggestion,
as this particularly affects Welsh stock that are slaughtered and processed in