Phil Hogan’s Speech At FSAI Conference On “Safeguarding The Food Chain” – 6th October 2017, Dublin Castle
Ladies and gentlemen, it is my great pleasure to address such a knowledgeable audience here in Dublin Castle today. My thanks to Dr Pamela Byrne for the invitation.
Safeguarding the food chain, both in Ireland and across the EU, is a complex job of work. Your panel this morning has addressed the issue of food fraud and how to tackle it from a regulatory point of view.
This is a vitally important perspective, and one where the EU has made great strides, notably through:
The creation in 2013 of the EU Food Fraud Network, which promotes more efficient cross-border assistance and cooperation;
The development of a dedicated IT tool, the Administrative Assistance and Cooperation System (AAC), to enable members of the network to rapidly exchange information on potential cases of cross-border fraud;
The regular organisation of specialised training for food inspectors, police and customs officers, and judicial authorities of the EU countries – and also third country partners – in the framework of the Better Training for Safer Food initiative.
Coordinated Control Plans at EU level;
And the new Official Controls Regulation. This important update ensures the application of food and feed law, rules on animal health and welfare, plant health and plant protection products, and the revised Regulation will gradually come into effect in the coming years.
These are all strong and positive steps, which will copper-fasten Europe’s position as the global leader in food health and safety standards. I want to give a particular mention to the Food and Veterinary Office up the road in Grange, Co. Meath, and the critical role its experts play in this field.
Thanks to their work, and your work, and the work of all your colleagues in the broader food safety and quality sphere, we maintain the highest standards of quality, safety, regulation and control in the world.
And this unyielding commitment is a key reason for Ireland and Europe’s ongoing success in global agri-food trade.
In my own portfolio of Agriculture and Rural Development, my approach is to look at these issues from a bird’s eye view, because they are all interconnected. In particular, if we can strengthen the functioning of the European food chain, we can address many related challenges, including fraud, at an earlier stage.
We must look at each link in the chain and identify the areas that need to be most urgently strengthened.
Let me describe the problem in greater detail before I share with you my roadmap for finding a solution.
In Europe we still treasure the family farm model and all it represents for our rural areas. The European Commission wants this principle to continue, distinguishing ourselves from other global players where a small number of large-scale operators dominate the agri-food sector.
The CAP is an increasingly market-orientated policy which provides farmers with both opportunities and challenges. On the one hand, they have an expanded horizon of commercial opportunities in Europe and on global markets.
However on the other hand, they are also subject to prevailing market conditions which, as we have seen in recent years, are not always favourable.
It is essential, therefore, that the Common Agricultural Policy – which is designed to support farmers and ensure they receive a basic safety net and income support – also provides those same farmers with the necessary instruments to deal with market volatility and price fluctuations.
This is where the Commission’s work on the food chain comes in. As someone who grew up on a small family farm, I understand that the bottom line comes first. If farmers don’t get a fair price for their work – if they can’t make a decent living – then we have a real problem. The farmer’s share of what EU consumers spend on food is being continuously squeezed, due to the clear imbalance of power between producers and other links of the food supply chain.
Concretely, supermarkets in particular now enjoy “super-power” due to the twin effect of increased globalisation and a high level of concentration within Europe. This gives them disproportionate leverage over primary producers.
The imbalance of bargaining power between price setters and price takers is stark, leading to a situation where there is a real “fear factor” for farmers of commercial retaliation, late payments and other headaches.
Existing mechanisms such as the EU Supply Chain Initiative are not perceived by farmers to have any real teeth as they are voluntary, and lack serious consequences for retailers engaging in Unfair Trading Practices.
In my view, this is not good enough. A well-functioning food supply chain is essential for our society. Farming, food processing, retail and food service represent over 44 million jobs in 14 million businesses across the EU. This is one of our biggest employment sectors.
And our consumers can only be guaranteed a reliable food supply if farmers are guaranteed a reliable income and a fair share of the pie.
This has become such a pressing issue at EU level that European Commission President Jean-Claude Juncker has referred to it on numerous occasions, including in two out of three State of the Union speeches.
To tackle this problem head-on, I decided to set up an Agricultural Markets Task Force in January 2016. This group was made up of 12 senior experts with strong expertise from different parts of the food chain. Last November, the taskforce published a report providing detailed policy options. These are now under consideration and they represent a very welcome addition to the debate on how to strengthen the voice and position of the farmer.
The Task Force’s report calls for new rules at EU level to cover certain Unfair Trading Practices (UTPs), as well as the implementation of effective enforcement regimes in Member States such as through the use of an Adjudicator.
Bear in mind that tackling this at European level as opposed to national level is the most complex and challenging course of action. It is true that some effective enforcement regimes exist in Member States, such as the Groceries Adjudicator in the UK, but this is not widely replicated.
Other recommendations from the report include increasing market transparency, enhancing cooperation among farmers, facilitating farmers’ access to finance and improving the take-up of risk management tools.
I am very pleased that these issues have now fully entered the EU policy mainstream. In September, at the Informal Meeting of Agriculture Ministers in Estonia, the main discussion topic was ‘Empowering our farmers with effective tools to manage risks post-2020’.
And the coalition for action is strengthening all the time. Let me demonstrate in detail what I mean: the Commission conducted an impact assessment on Unfair Trading Practices to gauge the most viable course of further action.
The results of this study, which were made public earlier this week, were startling. They found that every significant stakeholder is in favour of action at EU level.
A clear majority of Member States which is in favour of an EU approach, as is a majority of farmers, processors and NGOs.
In fact – and I’m sure this will not shock you – the only stakeholder group in favour of keeping the status quo is retailers.
I view these findings as very encouraging, because they reflect the reality of fragmentation in the internal market due to the different approaches of different Member States.
This is why they favour defending and developing a well-functioning and coherent internal market, to cover the whole EU food supply chain.
We are now moving to the next step of drafting a legislative proposal. It is my sincere hope that all the stakeholders who recognise the problem will also proactively support the potential solution.
I hope you appreciate why I am making this point at this high-level conference. No-one understands better than this audience the crucial importance of strong and continuous regulatory policing of the food supply chain, to eliminate scandals like those you have discussed this morning.
But regulators and policymakers can never afford to lose sight of one salient fact: without the primary producer, there is no food supply chain. And primary producers can only do their vital work if they receive a fair buck for their work.
So to conclude, allow me to wish you the best of luck for the remainder of this conference, and thank you for the important work you do in safeguarding our food chain.