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Promotion 'not the answer to industry's ills' - AHDB chair Kendall

In response to the furore that has erupted over how farm levies are spent, AHDB chairman Peter Kendall has outlined his position on levy-funded promotion and explained why a red meat campaign has not been signed off. Yet
Peter Kendall and Farming George Eustice at AHDB's Stoneleigh HQ
Peter Kendall and Farming George Eustice at AHDB's Stoneleigh HQ

AHDB chairman Peter Kendall has spelled out his reservations about using levy money for promotion but has insisted he did not block a proposed red meat promotion campaign.

 

The failure of the campaign to see the light of day has been at the centre of the furore that has blown up this week following the resignation of Stuart Roberts as chairman of AHDB’s beef and lamb board, which proposed the campaign.

 

While Mr Roberts has insisted his resignation was driven by wider Government interference in how levy money is spent, rather than over this particular campaign, Mr Kendall has been accused in some quarters of having a hand in the Government’s failure to approve it.

 

Mr Kendall said he and AHDB chief executive Jane King had been charged by Defra with ‘carrying out more rigour in demonstrating value’ in levy spending and had been asking ‘searching questions about the value-for-money and objectives’ of the promotional campaign.

 

But he insisted he had ‘absolutely not’ advised the Government not sign off the campaign.

 

“We have been going backwards and forward with Government and we had to tailor a submission that tries to work in with their objectives,” he said.

Timeline

Mr Kendall said ‘one part of the beef and lamb promotional budget’, promotion of the lamb mini-roast, ultimately ‘fell short of a timeline’ in time for it to go ahead this autumn.

 

“The process of examining its purpose ended too close to a deadline to do some of the work,” he said.

 

But he added: “We are expecting the Minister to sign the rest of this work off soon, if not imminently. And a lot of that work will go ahead.”

 

Venting his frustration at the criticism coming AHDB’s way, he insisted he was ‘not against promotion’ but, with a beef and lamb budget of £16m, it was unrealistic to mount the sort of campaign the big brands can afford.

 

“I will say this bluntly because no-one else is saying it. What I think is criminal here is that we keep telling people we are going to solve over-supply across all agricultural markets today by telling the public to buy a certain product. That is the tragedy of this.

 

“I remain fully supportive of doing good promotional work but let’s not convince ourselves that this is going to change the position. We have got a strong currency, over-supply, the Russian export ban and weakening demand in China.

 

"The idea that some marketing is going to solve the ills of the current market… I don’t believe that.”

 

He expressed concern that ‘across the board Defra or AHDB are being held responsible for the market being on its knees’.

Collective response

Mr Kendall also called for a ‘collective industry response’ to the issue that triggered Mr Roberts’ departure, the concern that Defra work was being passed onto the levy board, suggesting it was down to industry representative bodies, as much as AHDB to make the case for how levy money is spent.

 

“We know Defra are looking at cuts of between 25 and 40 per cent. I believe it is absolutely vital the industry thinks and acts like one in making sure the work of the Government is not in some way forced upon the levy boards as an easy way out,” he said.

 

But with his leadership at AHDB being publicly questioned this week, he acknowledged the need for both he and AHDB to ‘communicate better’ the work it does and the challenges stemming from cuts to Defra’s budget.

 

He said, following the move from his highly-politicised NFU role, he had deliberately sought to ‘avoid being involved in public debate about what the industry should be doing or how it should be moving forward in this difficult time.

 

He made an offer to meet his critics face-to-face.

 

“I will offer to get in the car and talk to farmers anywhere in the country to listen and hear their concerns and also explain what we are trying to do with AHDB for the benefit of UK farming PLC,” he said.


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The great levy debate - industry views

The great levy debate - industry views

“At the present time I can foresee a realistic prospect of the levies, in the long term, being lost to the realms of a remote tax that the industry will have little or no influence over. This is a situation I am determined should not be allowed to happen and have therefore resigned as an AHDB Board member and Chairman of the AHDB Beef & Lamb Sector Board."

Stuart Roberts' announcing his resignation

 

His surprise move has sparked much debate on AHDB and how farmers' levies are spent, particularly when it comes to promotion.

 

“It is concerning that a planned beef and lamb promotional campaign, approved by the AHDB Beef & Lamb Board, has been blocked by the Government at a time when British sheep producers in particular face difficult market conditions. The industry as a whole must send out a clear united message that levy payers, not the Government of the day, should decide how levies are used.”

Stephen Rossides, Director of the BMPA

 

“To witness this level of ministerial intervention this year, at a time when the industry is in great need, is inexcusable.

 

"The danger of over-reliance on exports has been clear to see this year. We know that consumption of lamb is falling in the UK and so an essential part of what we do has got to be raising awareness and interest. We are very concerned that even less promotion is going on this year than usual and that there is not a great enough appreciation of the domestic market within some parts of AHDB.”

Phil Stocker, National Sheep Association chief executive

 

“It is totally unacceptable for a whole planned marketing campaign to be put in jeopardy by Government dithering and delay. Sheep farmers are now demanding increased marketing and promotion of lamb at this time in an attempt to counter low prices and make domestic consumers aware of the quality of our product.”

Charles Sercombe, NFU livestock chairman

 

“Producers are not seeing the benefit of their ‘red meat tax' and the proportion of levy spent on promotion is too low. I can't see other big companies having their budgets signed off by the Government. Maybe we need a different structure."

NBA director Chris Mallon

 

"The English pig industry has sent an unequivocal message to Government — keep out of decisions about how the pig levy is spent. Almost unanimously producers want more of their 85p-per-pig levy to be spent on marketing, to encourage younger consumers to understand and embrace modern ways of cooking and serving pork."

 

‘As diets change in our sophisticated marketplace, intelligent and informative marketing to explain the benefits of red meat is absolutely essential if British producers are to grow or even just maintain the domestic customer base. If AHDB cannot achieve this on behalf of levy-payers because of Government interference, then it is hard to see what its role will be going forwards.’

NPA chairman Richard Lister

 

Frustration and anger over Government interference has been matched in some quarters by ire directed at AHDB and its leadership.

 

“Farmers are really annoyed and some are now saying they want to stop paying levies and instigate the sunset clause on AHDB Beef & Lamb. If the direction of travel is to use funds for things farmers don’t want then I would whole-heartedly support that."

Charles Sercombe

 

“I think Peter Kendall should be suspended from his job until an independent and full transparent investigation has been carried out about the way he has stopped all advertising campaigns for produce from all sectors.”

David Butt, Mid Devon beef and sheep farmer

 

Here's Defra's take.

 

 

"As a public body, AHDB has always been accountable to Parliament for how it spends levy payers’ money. Their leadership team is introducing crucial changes to give farmers better value for money. These changes will focus on both the best interests of the industry and delivering for levy payers.”

Defra spokesperson

 

Final word to Stuart Roberts

“If what I have done kicks off a debate and discussion about that, then hopefully that is an opportunity and something positive will come out of it.”

Stuart Roberts after resigning as AHDB Beef & Lamb chair

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