The paragraph numbers in brackets refer to the paragraphs of the Report from which the conclusions and recommendations are taken.

108. From the evidence that we have received, the claims for certain benefits of organic farming appear to be valid. This would be so for biodiversity, soil structure, water quality, most aspects of animal health and welfare, and some aspects of food quality. (paragraph 65)

109. It is accepted that other consequences of organic farming are yield reductions of crops, lower production from animals, and, because of lower stocking rates, lower output per unit of land. This means higher cost per unit of food, but given the lower input costs of organic farming and the possibility of higher prices for organic products it does not necessarily mean lower profitability for the producer. (paragraph 68)

110. The Committee thinks it is important that there should be a clear and intelligible basis for organic standards for both production and processing, and so urges that the standards should be underpinned by detailed scientific research. The establishment of a technical committee in UKROFS is a welcome step in this direction, and we hope that the recently increased funding for organic research and development will also be of assistance. (paragraph 73)

111. Any attempts to dilute standards further should be resisted, and for this reason it is important that the sector bodies remain closely involved in standard setting. The standards are essential to retain consumer confidence, and while we note that the use of copper-based fungicides is due to be phased out, the Committee does not think that consumers would expect such products to be used in the production of organic food. Other anomalous substances were also cited which are not due to have their approvals withdrawn. The Committee recommends that research into the identification of less toxic alternatives should be given priority, and suggests that one of the first tasks of the new UKROFS technical committee should be to review the substances which are currently approved by the European Commission, and then make appropriate recommendations to the article 14 management committee. (paragraph 74)

112. The Committee welcomes the agreement of the livestock amendment to Regulation 2092/91, if not every detail of it, and now that it has been adopted, the Committee considers that the Government and European Commission should view as a priority the adoption of standards for areas still not adequately covered by Regulation 2092/91, such as fish farming and complex processing. Consumer confidence is vital for the organic sector, and the Committee urges the Government to implement the amendment in a way which does not jeopardise this confidence. (paragraph 80)

113. The Committee hopes that the Minister will bear in mind the need for continuity on the UKROFS Board and notes that some flexibility has been exercised in the recent round of appointments to the Board. In relation to the funding of UKROFS, any permanent increase in workload, particularly including certification of imports, should be matched by a proportionate increase in funding. This is important if consumers are to retain their faith that the organic sector is properly regulated and they can trust the authenticity of the organic label. (paragraph 82)

114. Given the increasing likelihood that producers and processors will be attracted to the organic sector by the available profits, and the current impossibility of testing produce to prove its authenticity, we do not think it is sufficient to rely on a paper-based system for organic imports. For produce entering the EU we recommend that the Commission works closely with IFOAM to develop a system which includes on-the-spot checks by inspectors working for the EU. In the longer term globally recognised standards should be established and observed. (paragraph 85)

115. The Committee considers that the Government must help the organic movement and conventional farmers who intend to use GM crops to reach some kind of modus vivendi, respecting as far as possible the wishes of both sides. Both UKROFS and the new Agriculture and Environment Biotechnology Commission should have central roles in this process. It will be vital to find an acceptable compromise over minimum set distances between organic and GM crops, similar to the rules for preserving seed purity, which specify required distances between crops grown for seed production and all other crops that could result in cross pollination. (paragraph 86)

116. The Committee does not think that it makes sense to set an arbitrary target the achievement of which will be dependent on factors outside the Government's control - such as the state of the conventional farming sector and the strength of demand for organic food. Having said that the Government should not be tied to an arbitrary target, the Committee does consider that organic farming brings benefits, and that Government support is justified. (paragraph 89)

ONGOING SUBSIDY

117. We do not think that the Government should introduce a new scheme which provides ongoing subsidies exclusively for organic farmers. The Committee is not convinced that organic farming is the only way to achieve environmental and other benefits; there is a large amount of evidence that it is possible to produce similar outcomes using different farming systems. Organic farmers will of course always be strong candidates to be accepted onto existing agri-environment schemes, such as Countryside Stewardship and the Environmentally Sensitive Areas. An excessive targeting of funds towards organic farmers can only reduce the amount of money available for the achievement of environmental and other goals in the farming community in general. (paragraphs 91 and 92)

CONVERSION SUBSIDY

118. The Committee does, however, think that there is a strong case for continuing to provide support for farmers converting to organic methods. If there were no support during conversion, farmers might be prevented from converting by the temporary extra costs involved. Once through the conversion period, organic farmers should expect to rely on the prices they receive through the market, and any extra payments through general agri-environment schemes. (paragraph 93)

ORGANIC FARMING SCHEME

119. Although the Committee did not examine the subject of double funding in depth, we are concerned that the rules could result in disproportionate, even unfair, reductions in payments to some farmers, and we ask the Government to seek ways to avoid this happening in future. (paragraph 96)

120. The Committee welcomes the new Organic Farming Scheme but regrets the confused circumstances of its launch, and hopes that appropriate lessons are learnt for the future. In particular, potential applicants need to have sufficient information about when money will be available and what other grants they may lose, well in advance of the need to make a decision to apply. (paragraph 97)

121. The Committee recommends that when MAFF next review the scheme the organic sector should be consulted to determine whether there has been a failure to attract certain types of farmland into the scheme, resulting in under-supply of the market in certain products. The payment rates for different kinds of land or types of farming could be adjusted to take account of any discrepancies. For example, it might well prove necessary to offer a higher rate for fruit and vegetable producers, as much of the land now entering conversion is grassland. (paragraph 98)

122. We look forward to the day when EU agricultural policy is not so blatantly contradictory, and the inefficiencies of the production subsidy system are removed. In general, the direction in which the CAP is (very slowly) moving, with the redirection of support towards environmentally beneficial practices, should benefit organic farming. (paragraph 99)

123. The organic research and development budget should be steadily increased. Given the relative youth of the sector, its recent growth, and the potential for organic research to cross-over into the conventional sector, we think that the proportion of the overall research budget devoted to organic farming should be increased until some, at least, of the evident gaps in current scientific knowledge have been filled. (paragraph 100)

124. In order to ensure that the available funds are spent in the best possible way, the Committee recommends that well in advance of any funding decisions MAFF should consult the UKROFS research committee on what projects should be supported. (paragraph 102)

125. Farmers considering whether to convert to organic farming seem to receive a good service from the OCIS and its Scottish, Welsh and Northern Irish counterparts, and also from the sector bodies, and we hope that MAFF will match any long-term increase in demand for the information services with an increase in funding. There is, however, a gap in the provision of information, advice and training for farmers and their farmworkers once they have converted, and the Government and the organic sector should consider how that gap can be filled. One solution would be the establishment of appropriate training courses for those in the organic sector which could be part funded by the EU under the new Rural Development Regulation. (paragraph 105)

126. The Committee considers that the Government should do all in its power to alleviate the pressure on small abattoirs. For organic producers, the formation of co-operatives with specific brand names will help to build consumer loyalty and reduce packaging and distribution costs, and the Committee hopes that the Government will assist their development. (paragraph 106)

127. The Committee agrees that farmers' markets, box schemes and other direct links with the consumer are useful ways of selling organic products and should be supported. But it is also inevitable that some, perhaps most, organic farmers will have to deal with the major retailers, and the formation of co-operatives should enable them to obtain better deals by being able, for example, to ensure continuity of supply. (paragraph 107)

128. The Committee considers that policies affecting organic farming raise important questions to which the attention of the House should be drawn, and makes this Report to the House for debate.