The annual review of Defra from the Environment, Food and Rural Affairs Committee raises concerns over the departments further funding cuts and how this will influence the departments ability to carry out its work. There is also criticism of the management and the lack of confidence from Defra staff, the handling of the badger cull, and access to CAP funding 'digital by default'.

Defra is one of the smallest of Government Departments but it has faced among the most substantial budget cuts, which are set to continue up to 2016. The Department spent just under £2.5 billion in 2012-13. Its budget has been cut by £500 million since the 2010 Spending Review and it will face another reduction of £300 million in the years up to 2015-16. This raises some concerns — in the last year Defra has had to respond to floods, horsemeat contamination, and ash dieback. Its ability to respond to emergencies such as these must be protected. Clarity is required from the Secretary of State about precisely which policies and programmes will face significant budget reductions in the next two financial years.

Defra, to an unusual degree, delivers policy through a network of 28 arms-length delivery agencies, and once again clarity is required about the future funding and extent of those agencies and their programmes, including the Rural Payments Agency, Fera and the Environment Agency.

Access to CAP

Among the most significant challenges facing the Department in the next 12 months is implementation of the new Common Agricultural Policy, and it must take care to learn the lessons from implementation of the last new system in 2008, particularly as regards the simultaneous change of system and the introduction of a new IT system. Farmers who are unable to access online systems, particularly in areas not yet adequately covered by the Government's own Rural Broadband Programme, must be able to continue to access payments via paper-based systems.

Lack of confidence in leadership

The results of the Defra staff survey reveal an increased lack of confidence in the management and leadership of the Department. Defra scores below the Civil Service average in these areas. Although efforts are being made to address a number of areas, there needs to be a greater sense of urgency about addressing these issues, especially as the Department is about to enter a period of further budget cuts. Senior officials in the Department must take steps to manage the changes arising from the savings so that staff morale and engagement improves.

Further challenges facing Defra in the coming year include policy relating to bovine TB and badger culling, its proposals on biodiversity offsetting, the introduction of plastic bag charging, partnership funding for flood defences and examining the role and potential of GM technology in food production.

Biodiversity offsetting

We recommend that the proposal for biodiversity offsetting—to replace biodiversity loss resulting from developments—should not be taken further until the results of the pilots have been independently assessed. This in the light of Owen Paterson's comments at the weekend that ancient woodlands could be built on.

Efra stated that they are pleased that the Department has finally agreed to impose a charge for single-use plastic bags in supermarkets and larger food retailers but disappointed that the charge will not come into effect in England until 2015, despite evidence of its success in reducing plastic carrier bag usage in other parts of the UK. We recommend it be implemented sooner.