HC Deb 07 July 1965 vol 715 cc1573-5
17. Mr. Kenneth Lewis

asked the Minister of Agriculture, Fisheries and Food whether he will take steps to arrange a specially reduced interest rate for farm borrowing up to a limited amount, in view of the present high interest rate of borrowing from the Mortgage Corporation and the banks.

20. Mr. J. E. B. Hill

asked the Minister of Agriculture, Fisheries and Food whether he will set up an Agricultural Credit Organisation, backed by the Treasury, which will have special responsibilities for providing medium-term credit at reasonable rates of interest for those farmers who find it difficult to raise enough capital.

Mr. Peart

Agricultural credit is a very wide and complex question on which I am not yet ready to announce decisions.

Mr. Lewis

Is the right hon. Gentleman aware that there is a proposal by the Government that there shall be special rates for certain categories of house purchase? If and when this is announced, will he see that farmers are treated not less favourably and fight for them a little harder than he has done in the Price Review?

Mr. Peart

Hon. Members will drag in the Price Review. No other industry has its income decided in this way, and I think that the Review is a good procedure. On the question of agricultural credit, there are many problems to be settled and I am carefully looking at this matter.

Mr. Hill

Has not the Minister previously studied this problem? Otherwise, how could a specific pledge in terms of Question No. 20 have been included in the Labour Party's election statement? Surely there was some previous reconnaissance of the problem? In any event, since the election has not the farmers' need for raising extra capital and their difficulty in doing so been aggravated, among other things, by the prospective new burdens to be laid upon the industry by the Finance Bill, should it become law?

Mr. Peart

The hon. Member is quite right to draw my attention to a statement of policy which was made not long ago by my hon. Friends. I accept that. I also look back to another policy statement. I have here the Agricultural Charter of the Conservative Party of 1948. [Interruption.] The hon. Member asked me whether I had looked back. In 1948 hon. Members opposite promised that steps would be taken on these lines and they did nothing about it when they were in power.

Mr. Rankin

On a point of order. When hon. Members opposite intervene in these Questions, ought they not in fairness to the House to reveal their self-interests in the Questions that they ask?

Mr. Speaker

Hon. Members are not under an obligation to reveal their interests in Questions.

Sir H. Butcher

Could the right hon. Gentleman indicate why in 1965 the rates charged by the Agricultural Mortgage Corporation should be a full 1 per cent. more than the rates charged by building societies to urban owner-occupiers?

Mr. Peart

I accept that. As I have said, and I repeat, this is a very difficult question—whether a special industry should be singled out. There are problems here. I recognise this, and I am carefully examining them.

Mr. George Y. Mackie

Is the right hon. Gentleman aware that agriculture is now probably the most capital-intensive industry in the country? Are these problems political and economic or are they technical problems?

Mr. Peart

There are technical problems and there is the wider political problem whether a special industry should be singled out. In my Price Review and in the White Paper I have announced some new arrangements which will help in providing medium-term credit for those farmers who find it difficult to raise enough capital, and there is now Treasury backing. We are actually providing up to £200,000 a year by way of guarantees against bad debts. This should support many million pounds of new lending.