Mary Creagh - Speech to the Oxford Farming Conference 2012

Mary Creagh

Oxford Farming Conference speech

4 January 2012

22 years ago I walked through these doors to see my degree results. My heart certainly beat a little faster again as I walked through them this morning!.

I began my life as an MP by presenting the Children's Food Bill to Parliament. It had 4 aims –

a ban on junk food advertising during children's TV programmes;

Removing junk food vending machines from schools;

Nutritional standards for school meals;

And lessons in cooking and growing food for all school children.

All of those aims were met by the last government. But as a new backbencher, I never imagined that one day I would be addressing the nation's farmers as the Shadow Defra Secretary so thank you for this opportunity.

Food is one of the defining political issues of this century. Food security is on the agenda like never before.

Last June, the G20 held its first ever agricultural ministers summit in Paris.

Your conference is grappling with the global challenges that will define the decade to come. And I know that farmers really do grasp the nature and scale of those challenges.

This morning I want to look at 4 key areas

First, the role for farming and the food industry in creating the green jobs that we need for the economic recovery

Second the environmental challenges of producing more food sustainably, and our need to achieve a zero-food waste economy

Third the issue of domestic food poverty and how we ensure that no-one goes hungry in 21st century Britain

Fourth the threat posed by commodity speculation and the need to prevent a system-wide failure in our global food supply chain

First, the role of farming and food in stimulating the economic recovery and the need for a fair and competitive marketplace

Food and drink is the largest manufacturing sector in the UK, with a turnover of £76.2 billion, employing 400,000 people across the UK. Yet it is often forgotten or neglected in favour of more “sexy” manufacturing, cars, helicopters and advanced engineering.

I pay tribute to Mary Mead of Yeo Valley who has been recognised by the Queen for her dynamic approach to innovation in the farming and food sector. And for those cheeky adverts which are putting the fun back into farming!

Labour's five point plan for jobs and growth wants to see investment in food and farming: supporting skills and apprenticeships; helping businesses access bank finance; and bringing forward investment on critical infrastructure such as rural broadband to access new markets.

We want to see a fair and competitive supply chain for growers, processors and retailers.

That is why Labour in Government got cross-party agreement on the need for a Groceries Code Adjudicator to ensure a fair deal for farmers and producers. But we are worried by Government delays which mean that the adjudicator will probably not be up and running until 2014/15.

The Government has lofty aspirations about „buying British; but has failed to deliver on its promises. It spends £2 billion a year on food and is well placed to support British farmers and food standards through procurement.

Yet Defra's latest figures show that the department bought less than a third of its food from British sources in 2011. That must change.

The abolition of battery cages in the EU was, in large part, down to the push from UK consumers. It is disappointing that the government have not worked with the food industry to give consumers clarity on non-battery eggs. Our egg farmers have invested millions in the changeover. It is only right that they should reap the rewards.

Which is why my colleague, shadow farming Minister Huw Irranca-Davies is working with egg producers and the food manufacturing industry to produce a list of “good egg” users. The big society in action.

Fairness is a two way street however. We were disappointed that the government abolished the Agricultural Wages Board. It will take £90 million from the sick pay and holiday pay of low paid agricultural and horticultural workers over the next 10 years.

That money will leech out of the rural economy where those workers live. Out of the pubs and post offices, the local shops

and farm businesses, depressing the rural economy at a time when spending is already squeezed.

Labour wants CAP reform to encourage growth, a secure food supply and environmental benefits. This evening's debate will look at whether Britain is better off in or out of the EU. I say this. The EU faces many challenges and uncertainties. But it is the biggest trading partner for UK farmers. If the Eurozone breaks up the pound will strengthen, meaning cheaper imports, and a declining value for CAP payments. If the Eurozone breaks up, there will be the mother and father of liquidity crises, not just between banks but between nations.

So, my message to the Eurosceptics out there is, be careful what you wish for.

My second point is the great twenty-first century food challenge - how to produce more food sustainably

We cannot have food security without sustainability. It's not either produce more or produce sustainably. It's both.

The best farmers realise that the only long-term business strategy is one which puts sustainability at its heart, which respects its people and our planet's finite resources.

In Government, my predecessor Hilary Benn launched Food 2030 here in 2010. Sadly, it appears to have gathered dust on Jim's bookshelf. We have gathered stakeholders together to discuss how we can update it and not lose sight of strategic direction it sets out.

Changing weather conditions from climate change and a growing population will increase the pressure on natural resources. We need to move from our current linear resource economy based on extraction of fertiliser and oil from the

ground and then placing them on land to produce food to a more circular system which is less energy intensive, less virgin resource intensive, lower carbon, with less waste.

British homes throw away over 7 million tonnes of food each year, costing the average family £50 a month. We need to reduce food waste and in my home at least, put a lot less rice in the saucepan! Our supermarkets are doing their bit on frost pitted fruit or weirdly shaped vegetables. But all need to perform at the level of the best.

The Government needs to give certainty for farmers and businesses wanting to investment in renewable energy such as solar and Anaerobic Digestion. The row over the cuts to feed in tariffs risk investor confidence in the whole renewable energy sector.

We need a comprehensive approach to carbon reduction across agriculture and food manufacturing. The Food and Drink Federation reports that the sector has cut its CO2 emissions by 25% since 1990, saved water and halved waste to landfill, but there is still more to do.

Over the next decade, consumers will want to see increasing transparency about the carbon impact of what they consume. Carbon reporting will be a key driver in green jobs and growth.

The Government needs to publish its plans for mandatory carbon reporting for businesses by April 2012, under the Climate Change Act.

I am pleased that many food businesses and retailers, like Pepisco and the Co-operative Group, support the introduction of carbon reporting. I hope the government will not bow to anti-regulatory rhetoric and miss this once in a generation

opportunity to create a level playing field for carbon reporting across all sectors.

And the food that is produced needs to be affordable. So we need to harness the power of research and development to ensure that food remains widely available and that publicly funded research is publically available to all who need it.

Which brings me to my third point –the need to tackle food poverty

We are, sadly, familiar with the images of people struggling to avoid starvation in Somalia, Kenya, or the Sahel region of Africa. We know the global pressures that we face in competing for food and water supplies. In the recent past, no one in this country worried about food prices, or food security.

But now we also need to be alive to the challenge of food poverty here at home. Last year food prices in UK rose 6%, more than any other EU country except Hungary.

When Ed Miliband first used the phrase the "squeezed middle" to describe families feeling the effect of rising food prices, energy bills, pay freezes and job losses there was scorn from the media. Yet that phrase has now entered the English language.

The consumer price index estimates that we spend 12% of our income on food. But Job Seekers Allowance for a single adult is £67.50. I challenge anyone in this room to spend £7 a week on food and to eat healthily and well. It is simply impossible.

Which is why we are seeing the rise of food banks and fareshare schemes.

The Trussell Trust, the food poverty and social action charity, states that there are now 163 foodbanks around the country, with one opening every week.

Last year foodbanks fed over 61 000 people 20,000 of whom were children. This year (11/12) Chris Mould, Director of the Trussell Trust, expects that figure to double. 130,000 people, our friends and neighbours, relying on the charity of strangers to feed their families. While I welcome the actions of charities to tackle this hidden hunger crisis, I believe it is nothing short of a national scandal in this, the seventh richest country in the world.

Finally, the threats from commodity speculation facing the global food supply chain

We need a fair market for food. That starts with international action to tackle the commoditisation of food. Increased volatility in commodity prices makes it difficult for UK farm businesses to plan and to hedge.

World commodity prices have risen steadily over the last decade and some economists and hedge fund managers are now concerned about the impact this could have on the global cost of food and other commodities.

Commodities are the stuff of life, and of our economies. At the human level they are wheat, coffee, sugar, tea and beef. At a manufacturing level they are metals: copper, gold, silver, aluminium. At the energy level they are oil, gas, petrol and electricity.

10 years ago, less than $300 million of non-commercial money was invested in commodity markets. In one decade that has risen 1000 times, to over $300 billion of financial investment today, more than the entire value of the market 10 years ago.

Not coincidentally, commodity prices rocketed as well. Even worse, the price volatility of commodities increased dramatically too, which made planning and hedging for commercial producers and purchasers not only more difficult, but much more expensive. This has created a vicious circle where commercial producers and purchasers pay more to hedge and needed to hedge more as financial speculation has increased market volatility!

The problem is not commercial hedgers, the food producers, but excess speculation caused by Wall Street selling their latest financial products.

Higher commodity prices play their part in raising food prices. Recent research modelling undertaken by the university of Nottingham and the university of Exeter for DEFRA showed that the long term effect of a 10% shock to the world price of oil, translates into a 3.5% increase in retail food prices.

The UK government has recognised impact of world commodity prices, exchange rates and oil prices on food prices. But it failed to support French moves for greater transparency during the French presidency of the G20 so the US has acted unilaterally.

Higher food prices are painful for us in the UK where, as I have said, the Consumer Price Index calculates that we spend around 12% of our income on food. But these price rises are deadly in countries where food supply is insecure or where food takes up 60 or 70% of income.

Oxfam's Grow campaign focuses on the need for fundamental change in the food system. They have published research which shows that spikes in food prices have forced people to change their diets, sell their animals and in extremis, migrate to places where food is available.

So in conclusion each of these four challenges is interlinked. Food will play its part in our economic recovery –but its commoditisation could lead to global systemic risk in the food supply. We must address the global food security crisis with a smaller water, land, energy, chemical and carbon footprint. But we must also ensure that food is affordable globally and locally

Our generation must meet these historic challenges. And I am optimistic. There is a natural human appetite for innovation and experimentation. We have new tools at our disposal that were not invented 50 years ago – satellite technology, nano-technology as well as our proud farming heritage.

Our job as policy makers is to link science back to the field and back to the fork to ensure that the UK continues to punch above its weight in the global food chain.

I am optimistic that with the farming talent assembled in this room we are equal to that task.