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Presidential address to NFU Scotland Conference 2024

President Martin Kenedy address to NFU Scotland Conference, 8 February 2024

When I wrote my address to you all this time last year, I highlighted what the key challenges were that lay ahead for NFU Scotland and how they were going to be addressed. 

It goes without saying that headline and overarching challenges such as trade, labour, support and fairness in the supply chain, never go away and we continually lobby on your behalf to achieve what NFU Scotland’s vision is all about, to create a profitable and sustainable agricultural industry.



Looking back on last year’s challenges, one that was particularly difficult and so important for NFU Scotland, was the appointment of a new Chief Executive. 

After a number of very high-quality candidates went through our interview process, we were delighted to announce John Davidson as our new CEO. 

Now that John has been in position for nearly eight months and has travelled the length and breadth of the country engaging with as many members as possible, it’s very plain to see he has been a great appointment and has been very well received by not only our membership but also with wider stakeholders. 

As I said at our autumn conference, he has a positive infectious enthusiasm which I know he will retain, despite one member saying, ‘we’ll soon knock that out of him’. 

Of course, for the best part of 7 months NFU Scotland functioned flawlessly albeit extremely stretched without a CEO. And I would like to take this opportunity to pay tribute to the whole team, particularly Jonnie Hall who stepped up and lead us through that challenging time until John was in place. I have no doubt that your union will go from strength to strength to help deliver that vision of sustained profitability.

So, on the point of profitability, why is it such a bad word that some in society see as either greedy or controlling? 

Nothing could be further from the truth when it comes to farming and crofting. I can understand people’s views when we see utterly obscene profits being made by companies, sometimes multi-national companies whose only interest is to deliver for their shareholders, but that’s not what profit in agriculture does.

We need to change the understanding of what profit delivers in the agricultural world. 

We all know that food and drink is the biggest driver of the Scottish economy.  

But if we don’t have our primary producers in a profitable situation, then not only will we begin to see a further decline in our production of high-quality food, but we will also see less investment back into our rural economy. 

Even as an average hill farmer I am willing to invest in new equipment to drive the business forward and help the economy, in fact this year we invested in a new bedding machine – a pitchfork!.

Joking aside, investment from profitable agriculture delivers billions to the wider economy so that investment must be protected.

A lack of profit, that leads to reduced production, would be disastrous on so many fronts, as the loss of critical mass denies the volume of product required by the whole food chain. Then ultimately the biggest part of Scotland’s economy shrinks so the country’s ability to invest in other needs of society is compromised. 

However, you all know that I’m preaching to the converted here. The question is what are we going to do about it? 

Well, first of all, we need to explain all of this in much more detail to governments. Our new updated strategic policy priorities and key asks, which we will hear more about tomorrow will help get this message across.

I say governments, because it is every bit as important that we explain all this to decision makers in London as it is those in Edinburgh. 

Why? Well, there’s three reasons.

First of all, there’s as much a lack of understanding of what agriculture does in Westminster as there is in Holyrood.

Secondly, when it comes to funding, it is the UK treasury that holds the purse strings.

Thirdly, so many things that affect Scottish agriculture such as trade deals and immigration policy are reserved to Westminster.

Our next speaker will have the opportunity to tell us how the UK government intend to support the biggest part of the economy in Scotland, that needs to be in line with our key policy asks.

So, this year, given we are undoubtedly in a general election year, we are planning a National Hustings. When I say National Hustings, I mean a party husting of MPs with their portfolio in rural affairs and agriculture. 

This will call out the current leads from all the main parties to tell us from a UK perspective what they will do for Scottish agriculture. 

This event will all be about reserved issues such as trade, labour, and support which are solely the responsibility of Westminster.  How have these three important issues moved on since last year and how can we improve on them. 

On trade, there’s obviously no going back on what the UK Government signed off with Australia and New Zealand.  These deals sold agriculture down the river using farmers and crofters as a cheap pawn to get something over the line quickly. 

Hence the reason we now need to look at labelling much more seriously than we have in the past but more on that later. It is very fair to say that the Rishi Sunak administration has taken a much more in depth look at sensitive products and how such trade can compromise our own food production and economy. This is in stark comparison to the previous administration.

The Windsor framework has indeed helped things progress from a Northern Ireland perspective and the recent relaxation of restrictions has helped re-instate Stormont which can only be a good thing. 

Hopefully before long, we will also start to see relaxation in the political blocks for products such as seed potatoes getting back into Europe. We know they are desperate to access our high-quality seed, but politics is still the biggest problem, and we continue to have discussions in Brussels to try and break this needless deadlock.

Again, the difference in the agreement on the CPTPP, comprehensive and progressive transpacific partnership has shown a stark comparison from where it might have been. Liz Truss’s starting bid was around 100,000t for imported beef, who knows where that might have ended up, but it was signed at 13,000t after 10 years starting at 2,600t. (access relaters to imports)

This has happened because of constant pushing from all the UK unions, otherwise we might have been in a different place. 

It’s blatantly obvious why the Canadians are outraged by the push back on the recent Canada trade talks, as once again the previous administration had promised full liberalisation. 

However, it doesn’t stop there, the concerns around India particularly from an egg and egg powder situation are also concerning so we must continue to make the case to protect our own producers. 

Of course, it’s not just about trade, it’s also about safe trade and not compromising our own biosecurity. 

The BTOM or border targeted operating model for checking imports is at long last, after multiple delays, getting started this April.  However, it won’t be in place at all ports, but it is a start. 

This will give some relief to a very nervous pig sector that is still worried about the risk of African Swine Fever entering the country. 

Although the biggest problem will not be those who are legally certified and open to checks.  The biggest concern will still be illegal imports.

Figures from The National Pig Association two weeks ago highlighted that over 57 tonnes of illegally imported pigmeat had been seized at the British border since September 2022.  This included 5.5 tonnes of illegal meat confiscated over the weekend before Christmas alone.

The requirement for labour still falls on many deaf ears despite our continuous efforts to illustrate the concerns of agriculture.

There has been progress with seasonal workers and that is welcome, but the biggest concern right now is the new full time skilled worker salary threshold, rising from £26,200 to £38,700 due to come in in April of this year.  

This is completely unacceptable and will compromise not only our intensive primary producers but also have a devastating effect on the processing sector, without which the whole food supply chain falls apart. 

This issue of labour post Brexit, although highlighted as a major concern years ago, still tops the list of priorities for many industries, not just agriculture. 

We have already fed in our concerns to the migration advisory committee and will continue to raise at the highest political level that this must change, or we risk food security right across the board.

On future support, as I have already alluded to, this is one of the most significant things that must be addressed by the Westminster government - not just on an annual basis but on a multi-annual financial framework, similar to what we experienced under the CAP. 

Our national hustings will see where all UK parties stand on support for Scottish agriculture. We have already made our case clear that we need at least another £1b to be added to the UK budget for agriculture.

Under the current financial arrangement, that would see at least another £170m to go into the Scottish agricultural budget. We already have the backing of the Lib Dems on this extra £1b and they have agreed to this in their manifesto.  We are now trying to achieve that same commitment from all other parties. 

However, the current arrangement that sees 17 percent of the UK’s agricultural budget come to Scotland must be revisited. Scotland, right now, is doing the heavy lifting in terms of the environment, especially with current tree planting and peatland restoration, so the case is now being made to increase that current allocation. 

But it’s not just about the quantum of support, it’s how it’s delivered, and I’ll talk more about this later.

The last key element that’s primarily focused on reserved issues is fairness in the supply chain. 

As you know, the main focus of this year’s AGM is around market returns and how we achieve fairness from primary producer all the way through to our consumer. 

You have just heard the key results from our new ShelfWatch campaign and it’s plain to see which of our retailers live up to their word by supporting Scottish and UK producers. This campaign, which as you know will run all year, will give our consumers a real informed understanding of where their food comes from. 

As an industry we all accept that when it comes to climate change and enhancing the environment, we all have a role to play. That said, the cost of this enhancement cannot always be carried by the primary producer alone. 

For example, our retailers first of all dictate through the likes of Red Tractor assurance that we must do X, Y and Z to be eligible for their market and we will get a bonus for doing so. 

Then when supply is short and the price rises slightly, we’re dropped like a hot tattie in favour of imports that do not require to meet our standards, either from an environmental or animal health and welfare point of view. 

That must be called out now.  In the vast majority of cases, the only beneficiary of this hoop jumping is the retailers themselves as they try and leapfrog their competitor to achieve a higher footfall. Then eventually this so-called bonus that’s been paid for a wee while becomes the base price till we’re asked to do something else. The retailer benefits and the risk and cost remain ours. That must stop. 

We will have a great opportunity tomorrow to question the Grocery code adjudicator what they will do to ensure the primary producer is protected.

One success we have had on the milk side is securing, at long last, a statutory instrument to be laid down shortly on milk contracts.  

NFU Scotland has been looking at and driving this with other unions for many years, and I would like to pay tribute to our team, particularly Rory Christie, Sally Williams, Tracey Roan and some additional help from Nina Winter for picking up on the fact that originally these contracts were not going to affect existing contracts, only new ones, and it was the shear determination of our team that turned that round, so bloody well done.

Informing our consumers is massively important, hence the reason for our push to revamp the labelling system within the UK. 

We now have a fantastic opportunity to address this through the Good Food Nation Act whereby undisputed transparency of where our food comes from will allow our consumers to make a real informed choice. 

When lock down happened in 2020, we saw products coming in from overseas that were destined for the food service sector, but ended up on our retailers’ shelves. 

Our consumers showed real loyalty to our products and in many instances chose not to buy imports, so we know we have their support if they are properly informed.

NFU Scotland’s labelling proposal involves a very simple label in red which simply says;

MORE THAN 50% OF THIS PRODUCT IS FROM OUTSIDE THE U.K.

This needs to be U.K. wide as doing it from a Scotland only basis wouldn’t work. One of the biggest advantages of this simple labelling message is it would also apply to food service as this would be required to be on the menu.

Given the fact a third of our consumption is in food service, this would make a considerable difference. The reason you would set this at 50% is because we all accept we are nowhere close to self-sufficiency, and we cannot grow all our own ingredients so some must be imported. 

Again, as our programme is focused on local sourcing and market returns, we will soon hear from Brakes food service and how they go about sourcing locally.

This change to labelling could be a real game changer in terms of supporting our own food producers and stopping any food fraud that not only puts our economy at risk but also seriously compromises the biosecurity of all our crops and livestock. A simple labelling system such as this alongside our continuing ShelfWatch campaign would help inform our consumers and continue to give them confidence in their purchases.

My view is our consumers want to support local and far too often they are hoodwinked into thinking they are, but sadly with co-mingling and poor labelling they are not. 

If our retailers and food service push back on this, then what are they trying to hide?

We have already started discussions on this with Food Standards Scotland and have just received a letter from the food policy team within Scottish government to continue the conversation.

So now much closer to home and the continuing issues we have around funding, developing future policy and some of the challenges we have with the impact of the Bute House Agreement and its environmentally damaging green agenda.

What is still a massive frustration is the retraction of unallocated spend out of the rural portfolio, especially without any conversation with the industry. Tomorrow, we need to hear from the First Minister, not just the warm words that it is due to come back in, but how and when this will come back in to the industry.

Assuming, and this is a bold assumption, we have successfully lobbied for that meaningful budget, we need to know how it will be delivered? 

Hopefully after tomorrow we should at least know how the budget will be split between the proposed tiers in our new agricultural policy. 

We have continually said that we need at least 80% of the budget as direct payments within tiers 1 and 2. 

It must be remembered that Scottish Government have committed to 50 % of direct support having extra management options attached so the need for that vast majority of funding being retained within tiers 1 and 2 is all the more important.

As a framework bill there is a lot of flexibility within the Agriculture and Rural Communities (Scotland) Bill, is this a good thing? Well yes provided the secondary legislation delivers on what we need.

That’s when we need to be on our toes.

Questions have been asked for example, if we want 80% of the funding to be allocated to tier 1 and 2, why would we not want that written in primary legislation? 

Simply put, there may be a time when we need 100% of that funding to be in both these tiers.  

The geo political concerns across the globe right now and their effect on food security underline the need for flexibility

As far as the bill is concerned it’s built around four key elements, Food, Climate, Biodiversity and People. None of these elements are standalone and we already contribute to them all. 

How we deliver on more of the outcomes will be dependent on how practical and accessible the tier 2 options will be. 

What we continue to highlight is that if the bar is set too high then uptake of these options will be poor and not only will livelihoods be compromised, so will our environment. 

We hear that underspend in budgets is about the industry not taking current options up, however scheme rules, timing and delayed planning issues contribute massively to farmers and crofters simply saying it’s almost impossible to draw down the funds.

Farmers and crofters are the original environmentalists and have been for generations, hence the reason the farmer led groups were required to come up with many of the options that will eventually be available under tier two. 

Everyone is desperate to see what future policy is asking us to do and we need that clarity. 

I know I remain in the firing line as co-chair of the ARIOB, but I also know that given this is the first time in 50 years that any of the home nations have delivered an agricultural policy. 

If I and others were not involved, we may have more clarity of the direction of travel but I’m certain we wouldn’t like it. At least not if profitable farming and crofting was what you had in mind. 

This is taking a long time, I get that as much as anyone, but let’s get it right so we know we can continue to produce food without our hands tied behind our backs. 

Meanwhile, what we must also remember, is that until this new scheme is up and running, provided we successfully lobby for a continuation of the budget from Westminster, we will maintain the status quo, which given the direction of travel in other parts of the UK is something we should welcome.

So, what will be the first hurdles of our new policy environment? 

Well, we know it’s going to involve some degree of baselining. 

Is there a problem with that? 

Definitely not, provided the baselining is credible and meaningful for the business. Soil testing is something we should all be doing, and we have fought hard to get funding to allow us to test our soils to see how we can improve on them. We must remember that the science now tells us that the vast majority of our carbon stocks are within our soils so making sure our soil is in good health is a no brainer. 

Over the last 6 years we have seen a dramatic improvement in our soils at home both in terms of inputs and yield and I am convinced we are now building our carbon stocks, but we won’t know these figures for definite for another 4 years.

These two photos are a case in point, the first is from 2018.

And the second is from last year. 

So that’s us been round the whole farm and started again and the difference it’s making is incredible.

The next few photos are of one of this year’s fields of neeps. I’m dealing with quite a lot of neeps just now. 

The point here is knowing what’s in our soil to start with makes a massive difference in how we should cost our inputs. I know that many are already well on with this and have been for many years, however there is a great opportunity now to use the hard fought for funding available to help understand what we all have on farm.

There is no doubt that knowing what we are starting with is the first step in trying to improve on what we already have. 

For example, the guideline organic matter for this field and this type of soil is 3% and we are sitting at 6%.  The guideline for carbon stocks is 34 tonnes per hectare and this field is sitting at 67 tonnes and I have no doubt with this practice that these figures will increase.

So, baselining on a number of fronts is vital, that includes the likes of biodiversity and carbon audits. However, given the seriously advanced lidar technology that is now available, which uses very high-resolution light and distance range technology, we should be looking to Scottish Government to 100% fund a Scottish Lidar survey.

That would give us an undisputed account of our biomass stocks above and below ground. 

This may be a very credible use of the £61m of unallocated funds that we have been promised back into the rural portfolio. I’m sure that will create some discussion. 

Now on to some of the issues that often has a greater impact than funding, particularly on our limited more productive land, which could easily be addressed by the Scottish Government. 

Recently we have seen a number of named storms across the country, and without question with the increasing impact of climate change these storms have had a massive impact. However, storms aren’t new.

And now they tell us that we have only been naming storms for the past 10 years. I know this isn’t true as I can remember when I was wee, alright before there’s any smart comments, when I was young, my father naming storms on a regular basis, there was. Windy, Breezy, Blustery and Helluvagale and there was one particularly bad one that did some damage that I’m afraid I can’t repeat.

However, the damage caused recently, particularly by heavy rainfall on low lying productive land in short periods of time, wasn’t so bad as back then when we carried out local and routine maintenance of our ditches, waterways and rivers. I highlighted at our Autumn conference in detail the drastic results of the discontinuation of this routine management.

Not only did this protect high value crops, but it also helped enormously in protecting towns and villages from flooding. This was of course at no cost to the tax payer. 

So here lies the problem, we have a very limited amount of this type of productive land in Scotland yet from an economic perspective it punches way above its weight. 1% of our land yet 16% of agricultural output. Scottish Government are largely responsible for the recent damage we have seen to crops, floodbanks and fields on two fronts.

Firstly, inactivity on river management and secondly, which we warned about constantly is the situation we now have with the exponential increase in numbers of beavers. 

We now have real evidence showing their impact in areas where there was never the issue of flood bank blow outs prior to their re introduction.

We are now at the point where we simply cannot afford to have any of these rodents present in areas of productive land, end of.

Biodiversity is something that we all like to see and many species have adapted to positive management. However reintroducing species and over protecting others does nothing for the managed balance that’s in everyone’s interest. Now is the time to listen to those in the know on what is best for rural Scotland, not those who are in the dark.

So that brings me to the topic that is on every farmer’s mind across Europe and beyond, the green agenda. It is little wonder that across Europe discontent around some of the draconian measures now in place have driven them to protest in such fashion, who can blame them. 

From a Scottish rural perspective, the Bute House Agreement has been a disaster.  Almost without exception, every policy recommendation from the greens such as the DRS, the HPMA, housing initiatives to name a few have not only failed but have cost the country countless millions to even talk about, let alone the heartache and mental strain they have put people under. 

Their severe lack of understanding of how the countryside works is staggering. Also, despite on many occasions asking them to come out and look at specific issues, all too often their diaries are too busy. Moorland management, hunting with dogs, snaring, shooting and farming and crofting in general have suffered badly under this agreement. Then on top of this we have the issues around National Parks. All kinds of businesses that are so important to the Scottish economy are agreeing that this simply cannot continue.

At the Highland Show last year we asked for this agreement to be reviewed, we reiterated our asks and concerns in October, but nothing has changed. Now it is time to scrap this agreement altogether. 

If the SNP government wants to continue to support the biggest part of our economy and genuinely care about our fantastic environment, then I urge them to listen to us as the true economic drivers and custodians of the land and ditch the greens, as ironically they have been the biggest threat to the very environment we want to protect.

Ladies and Gentlemen, I have highlighted five key asks of not only both governments but retailers and consumers alike. 

First of all, an enhanced budget on a multi annual financial framework to be delivered into the rural economy in a manner that rewards fairly.

Secondly, to push a Scottish first programme when it comes to public procurement.

Thirdly, to fully return the £61m of unallocated funds as a matter of urgency to the rural portfolio.

Fourthly, to enable fairness throughout the whole supply chain.

And last but certainly not least for the sake of our economy and the environment, scrap the Bute House agreement.

Ladies and gentlemen, if these asks are all delivered, then Scotland will get the global credit it deserves for the high quality food it produces.

Thank you.

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