Scottish farmers welcome new Rishi Sunak legislation to improve dairy contracts after decade of campaigning

UK farming unions have been calling out unfair practices and abuse of power in the dairy supply chain for years.

Scottish farmers have welcomed new UK government legislation that is designed to bring fair and more transparent contracts in the dairy industry across Britain.

New regulations for the sector, which will cover all dairy contracts between producers and first purchasers, are due to be laid out in Parliament today.

The move comes more than a decade on from the National Farmers Union (NFU) SoS Dairy Campaign and with UK farming unions first calling out abuses of power in the dairy supply chain.

New legislation being laid in Parliament today will ensure fair and transparent contracts for all dairy farmers in the UK (Pic: Columba O'Hare)

The UK government held an industry-wide consultation in 2020 in response to the campaigning, which found unfair practices within the supply chain linked to buyers having the power to set and modify the terms of a contract with no negotiation with the producer and little notification.

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The new regulations, a commitment set out at the Prime Minister’s Farm to Fork Summit last year, will establish transparency and accountability across the dairy supply chain by stopping contract changes being imposed without agreement, farming unions have said.

They said there would be a new system to enable farmers to verify the calculation of variable prices. An enforcement regime will also be in place to impose substantial financial penalties in respect of any breaches to the regulations.

NFU Scotland milk committee chair Bruce Mackie (pic: Alan Richardson)

NFU Scotland milk committee chair Bruce Mackie said: “NFU Scotland and the other farming unions have been pushing for contract reform since 2011 and welcome the bringing forward of legislation to regulate dairy contracts.

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"This has been a key ask of the industry for many years. There will be a long road ahead and statutory contract legislation on its own will not solve all our problems.

“However, for too long, dairy farmers have had very little influence or power with regards to the terms under which they sell their milk. But they now have an opportunity to come together and make the most of what this legislation offers by way of strengthening their hand.

“We will continue to work with the UK government, other farming unions and the dairy industry in supporting our dairy farmers using this legislation to make their businesses more sustainable, progressive and create fairness in the supply chain.”

NFU dairy board chair Michael Oakes said the day marked “a significant step” in a long road of campaigning by farming unions to improve fairness across the supply chain.

Ulster Farmers Union dairy chair Kenny Hawkes described it as “a major milestone”, and NFU Cymru dairy board chair Jonathan Wilkinson said the legislation represented “a massive step forward” and was “a once-in-a-generation opportunity to change the way the dairy supply chain operates”.

It comes after Rishi Sunak addressed the NFU conference on Tuesday where he told farmers “I have your back” and promised to “change the culture” in government around farming.

Mr Sunak was the first prime minister to address the NFU conference since Gordon Brown in 2008, and took three Defra ministers with him to put the Conservative case to farmers.

Recent polling from the Country Land and Business Association found people in rural areas are defecting to Labour in huge numbers, with the party’s share of the vote having climbed to 37 per cent, and the Conservatives’ share falling 25 points to 34 per cent.