Winter Keep Scheme

HC Deb 06 May 1965 vol 711 cc1701-46

10.16 p.m.

Mr. Hoy

I beg to move, That the Winter Keep (England and Wales and Northern Ireland) Revocation Scheme, 1965, a draft of which was laid before this House on 27th April, be approved. Perhaps I might say now that it might make for general convenience if we were to have a single discussion on this Motion and the nine Prayers which are on the Order Paper in the names of right hon. and hon. Members opposite.

Mr. Speaker

As this is entirely convenient I do not resist it, but it must be understood, on behalf of the Chair, that no precedent is created for no more sinis- ter reason than that it could be used, if someone were to be so disposed, to get round the rule about Prayers.

Sir Martin Redmayne (Rushcliffe)

On a point of order. I take it that in the circumstances the rule about Prayers does not apply tonight. We fully understand the position. This debate could continue after half-past eleven.

Mr. Speaker

No. I do not wish there to be any misunderstanding at all. If we combine the affirmative Motion in connection with the Prayers my difficulty is that the rule applies to the Prayers and if the discussion covers both it may well be that in the course of the discussion on the affirmative Motion matters directly related to the Prayers might arise and be discussed. But the rule about Prayers would remain constant. The fact that I am prepared to allow discussion to extend over both still leaves the rule about Prayers stopping at 11.30, subject to certain discretions. I hope that this is understood.

Mr. Hoy

I am grateful, Sir. Let me make it perfectly clear that this has been done by arrangement.

I am very grateful that it has been possible to deal in one go with the Motion on the Winter Keep Revocation Scheme and the Prayers against the nine Hill Cattle and Hill Sheep Orders. All these Orders hang very closely together. They are the result of the study of the present pattern of hill subsidies which I was commissioned to make by my right hon. Friend last autumn. The study of the long term problem is continuing, but we decided that there were some changes in the hill subsidies which should be made straight away. These we propose to put into effect with these Orders.

One of the changes we decided upon was to alter the basis of assistance for winter keep. This was announced by my right hon. Friend on 22nd December last, in a Written Answer to a Question by the hon. Member for Bury and Radcliffe (Mr. Ensor). The Winter Keep Revocation Order is part of the legislative action which we must take to carry out this change.

The Winter Keep Scheme was introduced two years ago by my predecessor the hon. Member for Cornwall, North (Mr. Scott-Hopkins). In the debate he explained that the scheme had been designed to encourage the livestock rearer in hill areas towards greater self-sufficiency in his winter feeding arrangements. For this reason, the grants payable under the scheme were related to the acreage of specified winter feed crops which were grown on the farm.

There were some rather complicated provisions about the eligibility of hill farmers. Their land had to consist predominantly of livestock rearing land and their income had to be predominantly derived from livestock rearing enterprises; and certain crops, including barley, were excluded from the scheme. All these conditions gave rise to discussion in this House at the time the scheme was debated.

It was, I think, largely because of these rather complicated provisions that no one was really sure how the scheme would work out and whether it would give assistance to the farmers who really needed it. In fact, after a full year's operation of the scheme we found that it was not working out as fairly as I think everyone would desire in England, Wales and Northern Ireland. Experience showed that the real reason for this was that the grant was based on the acreage of cropping land. This meant that the farmer lower down the hill—in general, the one with the largest acreage of in-bye land—received the largest grant, while the man at the top of the hill, whose need for help was greatest, received little or nothing in the way of assistance.

There were others who found themselves ineligible because, although they were hill farmers, the greater part of their income came from milk or because their farm was not predominantly live-stock rearing land. In all, about 10,000 of the 29,000 farmers who are paid subsidy for hill sheep or hill cows found that they could not qualify for the winter keep grant. At the same time, there were some farmers who did relatively well out of the scheme and who managed to qualify for grant aid well in excess of what could be regarded as a reasonable level of assistance.

Thus, the position in England, Wales and Northern Ireland was that a large number of genuine hill farmers were excluded from assistance and, within those who were eligible, the money was not being distributed fairly. The solution we proposed was to pay winter keep assistance in the form of a supplement to the hill stock subsidies so that any farmer who was eligible for the hill cow or hill sheep subsidies would be given an extra grant towards the cost of feeding the stock in the winter. This proposal was welcomed by the N.F.U. and, during the course of the Annual Review discussions, we decided that the supplements should be at the rate of £5 a head for eligible hill cows, and 3s. 6d. a head for eligible hill sheep.

Here, I should say a word about Scotland, because hon. Members will realise that the changes which we are discussing do not apply north of the Border. I do not need to explain that conditions in many parts of Scotland are quite different from those in the rest of the United Kingdom. It is felt that direct encouragement should be given to the production on Scottish hill farms of at least a proportion of the necessary winter keep, and that much of the land in marginal upland areas might deteriorate rapidly unless encouragement is given to regular rotational working.

In addition, because hill land in Scotland is graded into three categories, as the hon. Member for Edinburgh, West (Mr. Stodart) knows, it is possible to weight the acreage payments in favour of the man at the top of the hill. This form of land grading has never been undertaken south of the Border, and facilities for it are not available there.

However, there is one complication. Many Scottish sheep farmers do not have much in-bye land on which to grow winter feed, hence the amount of grant which these farmers can claim under the scheme is low in comparison with the rate of 3s. 6d. per ewe which will be payable in England, Wales and Northern Ireland. The headage payment of 2s. a head will help to maintain parity of benefit on the two sides of the Border.

I have already mentioned that these proposals were welcomed by the N.F.U., but I would not like to give the House the impression that this is additional money that we are giving to hill farmers. What we are doing is to redistribute approximately the same amount of money in what we think is a fairer way. In fact, as my right hon. Friend expressed it on 22nd December, the assistance will be related more closely to the need.

Since 10,000 additional farmers are expected to benefit by this change, it will be obvious that some of those who enjoyed the benefit of the scheme last year will be getting rather less assistance in future. In fact, a few of those who were previously eligible for the grant will not be eligible at all under the new arrangements.

There are a number of reasons for that, but usually it will be because, although they occupy eligible hill land, their management or breeding policies do not qualify them for the hill stock subsidies. If, of course, they change those policies so as to fit in with the requirements of the hill stock subsidy schemes, they will be eligible for the subsidy and the supplement.

Finally, may I say that the new arrangements will make for much greater simplicity both for the farmers and the Ministry. There will be no complicated conditions to understand, or forms to fill up, and the farmers will claim the winter keep supplement automatically on the same form as they use for the hill cow or hill sheep subsidy. Virtually the whole of the administrative cost of the Winter Keep Scheme—about £127,000 a year—will be saved. I am sure that this must commend itself to the House. This revocation scheme will, therefore, pave the way for the new arrangements I have described, which are fully supported by the N.F.U., and I whole-heartedly commend the scheme to the House.

Now perhaps I may turn to the Prayers against the Hill Cattle and Hill Sheep Orders. I confess to feeling a little surprised that the Opposition have put down Prayers against these Orders. As I have explained, these, like the Winter Keep Revocation Scheme, are intended to put into effect decisions taken at the recent Annual Price Review as a result of the study of the hill subsidies which my right hon. Friend asked me to do as soon as we took office. I am glad to say that the reports which I have received show that these changes have been welcomed by the hill farmers as being fair and reasonable and in the best interests of the hill farming industry.

Statutory Instruments No. 970, No. 984 and No. 991 all seek to put into effect the increase in the rate of hill cow subsidy. In the past five years this rate has been £12 per breeding cow or in-calf heifer. At the Annual Review the Government decided to increase it to £13. At the same time, as I have already mentioned, it was decided that there should be a winter keep supplement for each eligible animal of £5, making a total of £18 in all. The subsidy and the supplement are not distinguished separately in the Order because there is no provision in the basic legislation for showing the composition of subsidy payments for any one class of stock.

Statutory Instruments No. 988 and No. 990 put into effect an alteration in the maximum permitted stocking ratio for the hill cow subsidy in England, Wales and Northern Ireland. I should explain here that under the old 1953 hill cow subsidy scheme undesirable anomalies had arisen because of the lack of precision on this point. The original guidance from the statutory committee set up to advise the Minister on the exercise of his functions under the legislation was that the land we were aiming to assist would not normally be capable of carrying more than one cow to eight acres on a traditional system. This ratio was accordingly applied strictly to farms consisting partly of eligible land and partly of better land, but for farms wholly eligible higher rates were accepted if the land could carry a greater number.

Over the years the introduction of different husbandry methods such as the sale of calves rather than yearlings, and also the improvement of pastures, made the one to eight ratio bite too hard on some partly eligible farms. At the same time their neighbours might be getting subsidy on one cow to six acres or even more on identical land. Hon. Gentlemen opposite clearly felt that this was inequitable and a maximum stocking ratio was introduced in the 1964 statutory Schemes of one cow for each six acres of eligible land for both wholly eligible and partly eligible farms.

This new rule had very little effect on the vast majority of farmers who had wholly eligible farms, but most of those with partly eligible land who had been restricted to the maximum ratio of one cow per eight acres were able to benefit by the increase in the permitted ratio. However, it was pointed out to my right hon. Friend that a maximum ratio of one cow per six acres of eligible land was biting hard on some farms and that this might tend to discourage farmers concerned from continuing to improve their land. I would remind the House that it is one of the objects of the Hill Cow Subsidy Scheme to improve the pastures on which the cattle graze and we can require part of the subsidy to be used for that purpose. My right hon. Friend therefore decided to relax this maximum stocking ratio slightly. The amending Orders fix a maximum of one cow for every five acres of eligible land on which subsidy may be paid in England, Wales and Northern Ireland.

In Scotland, however, there is no statutory maximum. The Scottish Scheme has always differed slightly from the other Schemes because of the different conditions north of the Border. However, each farm in Scotland has been given its own maximum stocking ratio beyond which subsidy payments will not be made.

In all three Schemes for the United Kingdom there is nothing to prevent a farmer from carrying more cattle on his land if he so wishes, but he will not receive subsidy payment for the surplus numbers.

Statutory Instruments No. 971, No. 992 and No. 993 represent, in the Government's opinion, one of the most important changes which have been made in the form of agricultural support to the hills for some time. Hitherto the rate of hill sheep subsidy has always been directly related to the economic conditions in the hill sheep industry during the previous 12 months.

Although this system worked reasonably well as regards the rate of subsidy finally agreed upon, it had several drawbacks. For one thing, the subsidy was always paid a year in arrear of needs; and, for another, as a farmer never knew from year to year whether there would be a hill sheep subsidy or what the rate would be, he was handicapped in trying to plan ahead. The advice, therefore, given to the Minister both by his technical advisers and by the farmers' unions was that the subsidy should be placed on a continuing flat-rate basis within the Annual Review, and he agreed.

The Statutory Instruments seek to put into effect the new rates at an amount sufficiently generous to cover the normal variation in weather conditions from year to year. For England, Wales and Northern Ireland the standard rate of subsidy will be 18s. and the reduced rate of subsidy 9s. While acknowledging that last year's rate was 25s., I may add that this standard rate of subsidy of 18s. compares very favourably with the average over the last five years of 9s. 6d. To both standard and reduced rates is added the 3s. 6d. winter keep supplement, making totals of 21s. 6d. and 12s. 6d. respectively.

For the same legal reason that I mentioned just now, these are the figures that appear in the Payment Orders for England and Wales and Northern Ireland. In the case of Scotland, where there is only the standard rate of subsidy, the figure is the same 18s., to which is added their winter keep supplement of 2s. which I mentioned earlier in my speech, making a total of 20s. in the Order. Statutory Instrument No. 972 ensures that the 2s. winter keep supplement is paid in Scotland only in respect of sheep maintained on eligible winter keep units.

I would like to conclude by assuring the House that my right hon. Friend is very conscious of the problems that hill farmers have to face. The House will have noted that in paragraph 11 of the Annual Review White Paper the Government announced their intention of carrying out a review of the fundamental problems of the hills and uplands to consider urgently what more should be done to make the best use of the agricultural resources in such areas, having regard to the economic, social and other factors involved. As I said when I began, we are pressing on rapidly with this fundamental review, and my right hon. Friend will inform the House when we have firm proposals to put before them. However, when the present Government first came to power we decided to put right, without waiting for the longer term inquiry, those things which could be corrected without delay.

Mr. Timothy Kitson (Richmond, Yorks)

Can the hon. Gentleman say when he expects this report to be made?

Will it be in the near future or in several months' time, or when?

Mr. Hoy

I should not like to put a date to it. It is rather a big job. The hon. Gentleman will know that we have been pressing ahead with it and we have to consider the opinions of all the parties concerned. What we are doing is to gather these opinions and to take these steps which I have mentioned and which have met with the approval of the farmers on the hills and the farmers' unions concerned.

I conclude by saying that these Statutory Instruments which have been laid before the House and which we are discussing tonight are to put into effect our short-term measures. I hope that they will meet with the approval of the House, and I ask the House to approve these nine hill cow and hill sheep Orders as well as the Winter Keep Revocation Scheme.

10.40 p.m.

Mr. Anthony Stodart (Edinburgh, West)

Mr. Speaker, I am sure that all hon. Members are grateful for your consideration in allowing us to co-ordinate the debate on the affirmative Resolution and the Prayers. Winter keep is so closely linked with the hill subsidies as virtually to be indistinguishable therefrom in certain cases, and no increase or reduction in arty of the three production grants can be regarded in isolation. All play their part in a sector of the agricultural industry, whose importance I myself have never at any time failed to emphasise. Indeed, I think that I might be entitled to be surprised at the hon. Gentleman expressing surprise that we tabled these Prayers. It would have been a very retrograde step and would certainly have met with the criticism of the Minister of State, Scottish Office if a Scottish Member had not probed whether Scotland was keeping in line over the hill and sheep subsidies in view of the switch which has taken place south of the Border.

My first point is about the hill subsidy of 18s., the regular payment which has been introduced. I imagine that the Government were delighted to be rescued from the difficulty they were having in their Price Review negotiations with an intransigent National Farmers' Union, as I understand it, by the suggestion which came from my right hon. Friend the Member for Argyll (Mr. Noble) that there should be a regular rate of hill sheep subsidy. I imagine the relief with which they went to the National Farmers' Union and suggested this idea. I rather thought that the hon. Gentleman might have paid acknowledgment to us for the suggestion.

I think that the Government have not gone as far and as wisely as they might have, because the suggestion that we have made and the pledge that we have given is that there should be a fixed subsidy and that there should be a second step which should take account of bad weather conditions. Although I of course recognise that 18s. is higher than the average of the last four years, until Chancellors of the Exchequer average farmers' Income Tax returns over a period of years one must realise that 18s. is a drop of 7s. from the last severe winter's rate and—one must bear in mind the possibility of another bad winter and we have been informed by the Government that there is no intention to revise this rate in the near future.

Having said that, may I ask the Minister of State this? What calculations I have made lead me to believe that an 18s. subsidy will cost roughly £4½ million over the United Kingdom. As the hill sheep subsidy now takes its place within the Price Review structure whereas previously it was outside it, can he tell the House—this is an important point—whether it was taken into account in the calculation this year which resulted in his right hon. Friend saying that there was a plus £10 million award? Perhaps he will tell the House when he replies.

I should like now to put to him one or two points about Scotland. Under what I might call the old system, we had three grades of grant averaging £3 10s., the hill cow subsidy of £12, and the hill sheep subsidy, which averaged 9s. 6d. The winter keep grant is to be continued and will average £3 10s., and the hill cow subsidy has been raised by £1 just as it has been south of the Border. At first sight, however, the higher supplements in England and Wales and Northern Ireland of £5 and 3s. 6d. compared with no grant for cattle in Scotland and a 2s. supplement for sheep do not look too good to many farmers. Of course, I realise—I think that this is a point which the Minister might well emphasise—that our winter keep acreage grants are to be maintained. Can be assure us that the hill grants in Scotland have been properly provided for in this manipulation?

That leads me to what I believe will be some hard individual cases. Will the Minister tell us what will be the position of the hill farmer in Scotland whose farm is either so high or so exposed that he cannot cultivate at all, and therefore gets no winter keep grant? He will, almost certainly, be in category "C", and therefore eligible for £5 an acre. I was interested in two figures which became available to me yesterday. In the annual report of the Department of Agriculture in Scotland, I read that 14,500 farms were eligible in 1964 for winter keep. A reply which I received yesterday from the Minister said that 9,250 grants had been paid. There is, therefore, a discrepancy of 5,250. Can he explain the reason for this? I believe that there may be a few who do not bother to apply, but I have a suspicion that there are many in the category which I have described, who, though eligible, cannot cultivate and are therefore suffering badly compared with their counterparts in England.

By way of example, I would tell someone to go into Scotland by way of Otterburn and Jedburgh, and to go to the top of Carter Bar. I do not know what the grading is of the farm on the Scottish side at that spot—I suspect that it is a "C" grade—but it is certain that the man on the English side will get £18 for his hill cow, whereas the man on the Scottish side will only get £13, probably with no cultivation ability to make up the deficit. It is possible that some of these farms may be able to raise a crop on five or ten acres and would therefore get possibly £25 to £50 over and above the hill cow subsidy. But these farmers—I should be grateful if the Joint Parliamentary Secretary could give us the numbers of those who are unable to take advantage of the scheme—in the type of farm in the "C" category should be given the same headage terms as exist in England and Wales solely for the "C" grades where cultivation is not possible.

The Minister said that the hill sheep subsidy supplement of 3s. 6d. and 2s. in the two countries—it might be more accu- rate if I said in the four countries—would apply to farms eligible for winter keep. Could be say what farms there are which get the hill sheep subsidy but which do not get winter keep? In other words, what farms will get the 18s. with no supplement? It seems slightly extraordinary, since the hill sheep subsidy regulations are drawn far more tightly than the hill cow subsidy regulations, that there should be a farm which is eligible for the hill sheep subsidy but not eligible for winter keep.

It would, I think, be wise for the Minister to confirm what he said about the hill sheep supplement being only for farms which are eligible for the hill sheep subsidy because something which appeared in the Scottish N.F.U. publication the Farming Leader seemed rather ambiguous. It should be cleared up. The publication stated: Accordingly"— and this was its account of the Price Review the Government agreed that the present acreage system in Scotland should remain entirely intact and that an additional winter keep supplement of 2s. per hill ewe will be paid on farms eligible for winter keep". The Minister will see the ambiguity in that. When I read that I wondered whether the hill sheep subsidy had been extended to cover every farm eligible for winter keep.

Many of my hon. Friends and I believe that these schemes are good, but I am doubtful if the Government are fully aware of the urgency of the beef situation. From the action they took in the Price Review in connection with the dairy herd, the 1d. increase, I do not imagine that they expected to get much increase in numbers in the dairy herd, which supplies us with 70 per cent. of our beef. Although the hill cattle numbers in Scotland have doubled since 1951, a considerable achievement, it will need a greater stimulus than an extra £1 per head on the hill cow subsidy because, if the Government are going slow on the dairy herd, it is to the hills that we must go for our beef supplies.

In each of the last three years the consumption of beef per head of the population has gone up by 2 lbs—that is, for every one of the 50 million people in this country, and by 1970 there will be an additional 2 million people. The problem is, therefore, a considerable one. I was staggered to hear the Minister say the other day that a modest increase was wanted in the supply of beef. When replying to my hon. Friend the Member for North Angus and Mearns (Mr. Buchanan-Smith) the Minister used the phrase "a slight improvement". If there is one thing that that Minister is not particularly renowned for it is his expressions of moderation. Therefore, when I heard him talk about "a modest increase" I pricked up my ears. It was an effective announcement, but a wrong one. As far as they go, the proposals are good. But I detect in their introduction by the Government a spirit of considerable complacency.

10.55 p.m.

The Minister of State, Scottish Office (Mr George Willis)

I do not wish to occupy much time in this debate because, quite clearly, a large number of hon. Members wish to take part in it. I do not wish to answer the general points raised by the hon. Member for Edinburgh, West (Mr. Stodart), but perhaps I may be allowed to answer the specific Scottish points.

The hon. Member asked whether the Scottish hill farmers were as well off under the new arrangements as were the English farmers. As far as we know, they are. Scotland elected to maintain the acreage payment, and this was done following discussions with the Scottish N.F.U., with the Hill Farming Advisory Committee and the Scottish Agricultural Advisory Council. Not only was it felt that direct encouragement for the production on hill farms of at least a proportion of the necessary keep was desirable, but it was considered that much of the land in our marginal upland areas would deteriorate rapidly unless specific encouragement was given to regular rotational working. These were the arguments that applied. The hon. Gentleman probably knows better than I do, but it is generally considered that the Scottish farmers do as well as the English; in other words, Scotland maintains its position.

My hon. Friend the Member for Edinburgh, Leith (Mr. Hoy) will reply to United Kingdom questions but, if I understood the hon. Gentleman aright, his other specific Scottish point was—arising from his two Parliamentary Ques- tions yesterday—the fact that 9,290 farmers had received grants under the Winter Keep Scheme in respect of the year 1964, whereas 12,632 had received payment in 1963, and 13,376 in 1964, for subsidy for hill cattle. The hon. Gentleman wondered what the difference was—

Mr. Stodart

No, perhaps it would be right, for the sake of clarity, to get the hon. Gentleman lined up on this matter. I said that the Department's Report on agriculture in Scotland stated that 14,500 farms were eligible for winter keep grant, and that 9,250—I think that was the figure—received winter keep grant. What has happened to the 5,000—it has nothing to do with the hill cattle scheme—in between?

Mr. Willis

Some of them have not made claims—the hon. Gentleman made that point himself. A great part of the difference is made up by the fact that, as I understand it, a number were very small units. I understand that that is the main reason for the difference. A total of 14,600 farmers are eligible, and the number making the winter keep claim is 9,250. The difference is due to the manner in which the total number of eligible farmers is calculated. Some of the farms are very small, indeed—

Mr. Stodart

I must persist in this point. Is it not the fact that whereas the National Farmers' Union agreed in principle, and wanted the retention of the acreage grant, it also raised the point of these "C" farms, which are eligible but cannot claim because they cannot cultivate; and that they suggested to the Government that there should be the headage alternative in that category? This is a most important point, and I hope the hon. Gentleman will face it.

Mr. Willis

Whilst there may be something in what the hon. Gentleman says, I think that he, too, is confused. All the farmers who did not claim are not in the "C" category—a large number are not—so the hon. Gentleman is really confusing the issues—

Mr. Stodart indicated dissent.

Mr. Willis

With great respect, I think that he is. The fact is that they do not claim. That is the short answer to the hon. Gentleman's point.

11.0 p.m.

Mr. George Y. Mackie (Caithness and Sutherland)

There are one or two points which I should like to make on the grants in general. Scotland, particularly in the south, will suffer because we have no headage payment and we are concerned at the effect that sheep subsidy will have on good husbandry. It will encourage to a large extent the old and rapidly running down system of sheep farming without cattle. Many farms in the Highlands do not have arable land. If they have one field it is better kept for the house cow for the convenience of the farmer's wife. No land is used as arable, and there is nothing that will improve land more than putting cattle on it.

An additional headage payment would be of immense assistance to the hill farmer. I have done this kind of farming myself and know that it can be done. One can buy in all the feed. Cattle-raising would improve the quality of the herbage and therefore improve the sheep. I would never condemn an extra subsidy to hill farmers, but without the headage payment for hill cattle the subsidy for sheep would be a bad thing from the point of view of husbandry on hill farms. I hope that in his review the Minister will tackle this point.

Another point is the inability of the upland marginal farmer to keep cows if he wants the marginal subsidy. This drives those farmers in these areas who keep cows—and they need the milk—into fundamental errors of husbandry and business management. If one keeps cows one should keep as many as one can. The same applies to the man who improves his land and wants to fatten his sheep. He should be able to go in for good, simplified and streamlined husbandry. In Scotland the N.F.U. and others need to look again at the headage payment. I have received letters from eminent and able farmers on the point. I should like to have the Minister consider it and hear what he has to say about it.

11.3 p.m.

Mr. Marcus Kimball (Gainsborough)

Before the Minister goes into this fundamental review of hill farming in Scotland, I hope that he will look at three points which arise out of the Orders and which need consideration.

The first is on the Hill Sheep Subsidy Payment (Scotland) Order. If he will study the form which he sends to hill sheep farmers he will see that one is not allowed to claim the subsidy unless one has the native breeds of Scotland—the Cheviots, the Black Face, and the various Island breeds. This mitigates against somebody who is trying to improve the fertility of flocks in Scotland. I know of several experiments which have now been stopped, because the subsidy is lost if one continues with some of the experiments which many of us would like to see go on.

I do not quite know how we are to get over this problem. The hon. Gentleman may well agree that, if one is conducting some of these experiments, with the support of the North of Scotland College of Agriculture, it should be agreed, when the experiments are started, that one will draw the hill sheep subsidy on so many experimental ewes, even if they are not of the traditional native breeds which are listed on the back of the subsidy form. I ask him seriously to consider that point.

My second point follows on from what was said by the hon. Member for Caithness and Sutherland (Mr. George Y. Mackie). The hon. Gentleman said that the hill sheep subsidy at this rate encouraged people to over-stock their farms, to over-graze the hills, and so on. In my view, he should have gone further and said that the hill sheep subsidy at this rate encourages people to keep five-shear sheep, old ewes which should not be on the hill at all. People are inclined to say, "All right; we will keep her for one extra year and draw the subsidy". This is a kind of attitude which one ought to think about very carefully. Surely, with this very high headage payment, we ought to do something to make hill sheep farming more efficient, and we shall not do that by keeping old sheep on the hill. It is very doubtful whether one ought to go on with the payment on the five-shear sheep, with the six-year-old ewe on the subsidy form at all. Most subsidy forms show a tapering off, and there is only a small number of them, but, in my view, they should be cut out altogether.

If our object is to improve the standard of hill sheep farming, the subsidy paid for the one-shear sheep not put to the ram should not be paid at the same rate as on the one-shear ewe which has been put to the ram. If the subsidy is to encourage and improve the standard of hill sheep farming, we must look more carefully at the conditions attached to the giving of it.

Now, a point about the hill cattle subsidy. At present, the emphasis is that one should try to get one's hill cows calving earlier and earlier. Many people, on the advice of the North of Scotland Agricultural College, are going all out for December or very early, almost uneconomic, calving. What is the object?—in order to be quite sure that, when the inspector comes round, one draws the subsidy before the October sales, as a sort of little proviso on the hill farm. The idea is to get one's calves big enough to be punched before being sold in October.

I ask the hon. Member to look seriously at this point and make up his mind whether or not, in the areas which are drawing winter keep grant and which are eligible for the hill cow subsidy, the calf subsidy should be payable for three months. The latest figures published by the Rowett Research Institute show what is happening. If one is to keep cows on the hill and have them calving in the spring, one should not keep the calves on the cows for much more than three months, and I ask the hon. Gentleman to consider whether the calf subsidy should be payable to the person who keeps the cows as an additional incentive. I hope that he will consider the question of paying the calf subsidy for three months in the areas which are drawing the maximum amount of winter keep grant.

We have had many discussions on the question of winter keep and hill farming. I hope that the hon. Gentleman will bear in mind that there is one way to improve hill farming, that is, to take another approach to the direct reseeding grants payable under the winter keep scheme. Of course, one can get a hundred per cent. lambing on the hills, but what happens? The hills are not capable of providing enough grass to feed more than one lamb per ewe. The only way to improve productivity on the hills is to go all out for a decent grant payable to people who, under the winter keep scheme, reseed their hills. It is no good just making one big payment in one area. One can go to the Islands and see how people have taken advantage of big grants, put down lots of grass seed—very expensive—and put in a lot of fertiliser—again expensive—but they have completely failed to maintain the grazing. We must take a leaf from the Forestry Commission. We should make the payment for reseeding under the Winter Keep Scheme spread over five or seven years to start with at £11-£12 an acre and a maintenance payment over the next few years.

I hope that the Minister will consider this matter seriously, because a lot of money is being wasted under the Winter Keep Scheme. A lot of grants are given for reseeding, but the areas are not being properly fenced and maintained.

11.11 p.m.

Mr. Peter Mills (Torrington)

I am particularly pleased that I am able to say a few words in this debate, for two reasons. One is that it concerns many of my constituents, men who have to work hard under difficult conditions to earn a living and men who, let us recognise it, produce some of the finest store cattle in the country. The country needs these men. It needs these store cattle to maintain our beef supplies. Once again, I reiterate that we must look to the hills and the moors for our store cattle.

Secondly, I am particularly interested in these schemes because I am, I suppose, the only hon. Member who has been thrown out of one of them.

Mr. Kimball

My hon. Friend is not the only one.

Mr. Mills

I beg pardon. I admit that it occurred several years ago. I worked hard on the farm and brought it up to standard under the Livestock Rearing Act. I was told that I had done too much, and I was thrown out. In a real way, therefore, I look with envy at these large grants per cow.

The Government have stated that they intend to give more aid for these hill areas and this is being done by the schemes: for sheep at the flat rate, and an increase in the hill cow subsidy. I certainly welcome these increases; they are fair enough. But what about the hill areas that do not come within the scope of the Act? The farmers who have been rejected under the recent Review represent a serious omission, which affects many of the small farmers in my constituency. The Minister promised that something would be done, but nothing has been done yet. Perhaps by the introduction of new legislation which was promised they could be included.

What does the Minister intend to do about this group of farmers who are so severely affected? The problem concerns not only my constituency, but other constituencies in the South-West. I have no doubt that if a Conservative Government had been returned, something would have been done.

Mr. Jeremy Thorpe (Devon, North)

Is it within the hon. Member's recollection that hon. Members from the West Country, including, to their great credit, Conservative Members, went time after time to the Minister but precisely nothing was granted to us? Why this optimism?

Mr. Mills

The reason for my optimism is that we were promised that the question would be looked into after the Review, and I am certain that this would have been done. I am not making a fuss about this matter. It is a difficult problem and these people well deserve help.

Consider some of the small farmers. In the Halwell and Beaworthy area there are difficult farms on the hungry land, as we call it, farms which are quite unsuitable for anything except the rearing of store cattle, which cannot grow corn and where the cattle have to be taken in a month earlier and let out a month later than in other areas, where it is extremely difficult to provide enough winter keep and where the farmers are nevertheless doing a grand job raising store cattle and rearing beef calves. We cannot afford the loss of these sources of store cattle. The £13 hill cow subsidy makes all the difference to their profit and loss. For a small farmer it probably makes a difference of between £150 and £200 a year, £3 or £4 a week, a very large sum. I am sure that this is a problem with which the Government must deal.

Paragraph 2(1) of the Hill Cattle Order speaks about the number of cattle per acre. Is this a permanently fixed num- ber? If so, it will not encourage better grazing and better management. Obviously, if money is spent on fertilisers and better grass seed, a higher stocking rate is needed and this should have been encouraged. As a boy on my first farm I was always taught, "If you put a penny in the chocolate machine, you get a bar of chocolate out". I am certain that many farmers are putting in the penny, spending the money on fertilisers and seeding and better management, and I hope that this number of cattle per acre is not permanently fixed.

What does the phrase "hill cattle" in the Explanatory Note mean? It may be obvious, but is it confined to certain breeds of cattle? In my experience the crossing of certain cattle breeds can produce some fine results, with more milk and more calves, and it is sometimes possible to put on another calf because of the extra milk.

What is meant by the phrase "hardy sheep" in the Hill Sheep Order? This seems to be a rough and ready way of putting it. Is it confined to hill sheep on the moors, the sort of sheep we call "Scotties", or down moor sheep? If it is, it is a pity, because once again crosses are playing an ever-increasing part in improving the stock on the moors. Some excellent crosses can be obtained from crossing these sheep with other rams—better carcases and more prolific. This is important, because as management improves and the stocking rate improves, we shall need to get a better type of lamb on the hills and moors.

I know that other hon. Members wish to speak and I hope that the Minister will be able to answer these questions and in particular deal with the issue of the farmers who have been excluded from the hill cow subsidy.

11.19 p.m.

Mr. Jeremy Thorpe (Devon, North)

Echoing what the hon. Member for Torrington (Mr. Peter Mills) said, may I remind the hon. Gentleman that on 29th June, 1964, the then hon. Member for Workington (Mr. Peart), now the Minister of Agriculture, said to the then Minister of Agriculture: What does the right hon. Gentleman intend to do for many of our small farmers in the hill farm areas? We must examine closely some of the difficulties created by his review of the cow subsidy for instance. What sort of development are we to have for our hill areas?".—[OFFICIAL REPORT, 29th June, 1964; Vol. 697, c. 953–4.] It will be within the recollection of the Minister that the hon. Baronet the Member for Tavistock (Sir H. Studholme) took the matter a stage further on 10th November in an Adjournment debate when he pointed out that while one would welcome an extension of the winter keep scheme and an extension of the hill cow and hill sheep subsidy arrangements, we still had a very grave problem of farmers who were essentially hill farmers, but who had been declared ineligible.

When we are considering these Orders it must be remembered that they will create even greater divergences between those who qualify and those who do not. In fact, the whole argument really is that the text of the Minister's speech was taken from Mark, Chapter 4, verse 25: For he that hath to him shall be given, and he that bath not, from him shall be taken even that which he hath. Would it not be right to say that a farmer who is ineligible for hill kine or hill sheep is, ipso facto, ineligible for winter keep as well? Is it never possible for an exception to be made, for a man on a hill farm who keeps either hill cows or hill sheep, but who is for purposes of the Livestock Rearing Act and the other Acts which followed it, ineligible because he is a farmer who has just got to grow winter keep, because he is still trying to stock his land?

On the hill farms in Devon, something like two-ninths of those who were eligible have now been declared ineligible. A total of 173 have been pushed out of the scheme. They have no hope of benefitting from any of these Statutory Instruments.

There are cases like the tenant farmer I know whose farm is 700 to 800 ft. in elevation. In 1962 he entered into a livestock rearing scheme for £5,000. He relied on the subsidy to help him in the repayment of interest on that money and now, before the scheme is even finished, he has been pushed out of the cow subsidy.

Another owner-occupier, who is, again, on very steep land, went in for a £4,000 livestock rearing scheme in 1956 and was told that his farm was suitable only for this system. Before the completion of this scheme he was pushed out. The National Agricultural Advisory Service told him, when he asked what other system he could adopt, that it was virtually impossible for him to alter his system.

These are some of the problems of hill farmers. Another very brief example is that of 255 improvement schemes under the Livestock Rearing Act. There was one farm in north Devon which was selected as being representative of all of them. It was a farm 750 ft. up, with clay soil needing £25 an acre to put the land in good heart. The largest stock was stones and rushes. This is the sort of farm which is now to be put out of the hill cow subsidy. It is going to cost the farmer up to £75 a year on his annual income. While we welcome the institution of winter keep, and improvements in hill cow and hill sheep subsidies, we are dealing with the problem of small farmers in hilly areas, who can make very valuable contributions to beef-rearing in this country. I hope this will be looked into at the earliest possible moment.

11.25 p.m.

Mr. John Farr (Harborough)

When the Winter Keep Scheme was introduced on 22nd May, 1963, at 10 o'clock, several hon. Members complained of the difficulty when we had complicated schemes of that nature introduced at such a late hour.

The right hon. Member for Kilmarnock (Mr. Ross), who is now the Secretary of State for Scotland, was one of those who objected at the time. Another was the right hon. Member for Workington (Mr. Peart), now the Minister of Agriculture, along with several other Members. The right hon. Member for Kilmarnock said: It is a very serious matter indeed that we should be discussing these Schemes so late"․[OFFICIAL REPORT, 22nd May, 1963; Vol. 678, c. 587.] Now that they form the Government, they still seem to find it very difficult to discuss important and vital schemes of this nature other than late at night.

At the moment there are six hon. Members on the back benches opposite. That is the highest number since the debate began more than an hour ago. The average has been about four. I formally call attention to the fact that there is not a quorum present.

Notice taken that 40 Members were not present;

House counted, and, 40 Members being present—

11.26 p.m.

Mr. Farr

When this scheme was discussed in 1963, hon. Gentlemen opposite odbjected to the discussion taking place after 10 o'clock because, they said, that they had had a long and difficult day discussing agriculture. But at least the discussions that day were on an important matter of real urgency to the country, and we did not waste time, as we have done today, with the party opposite trying to push through, against the wishes of the country, a futile policy which is of no earthly use to anyone. [Interruption.]

Mr. Deputy-Speaker (Sir Samuel Storey)

Order. I hope that hon. Members will listen to the debate quietly.

Mr. Hoy

On a point of order.

Hon. Members

Sit down.

Mr. Hoy

I do not require advice from hon. Gentlemen opposite. If we are going to debate the steel industry again, which is what seems to be happening, I think, Mr. Deputy-Speaker, that you had better rule on whether we are to have an opportunity of replying to it.

Mr. Deputy-Speaker

We are discussing these Orders, and nothing else.

Mr. Farr

I should like to refer for a moment to some of the effects which the revocation of the Winter Keep Scheme is likely to have, not only on hill farmers, but on farmers in the lowlands of England. Together, these Orders must have the effect of discouraging the growing of crops in the Highlands and in the qualifying areas in the uplands, because we are abandoning the Winter Keep Scheme, and because increased headage grants are to be paid, which in turn will encourage herd and flock expansion.

I think that this is a very sensible policy, and is far better than endeavouring artificially to stimulate the growing of winter keep crops such as oats in areas which are naturally ill-suited to that type of farming, or, to put it another way, are better suited to another type of farming.

It follows that if upland farmers are to increase their stock, and to grow less winter keep, they will have to meet their needs of winter fodder by considerably increased purchases. If the Government have recognised this fact, they have given no outward indication of it.

Are the Government expecting that the much increased winter keep requirements of upland farmers will be met by increased imports from abroad? If so, why, in view of the continual balance of payments difficulties into which they have steered us? Could the hon. Gentleman tell the House what is the extra amount of winter feed which he has estimated that the hill farmers will have to buy as a result of the introduction of these various new schemes and the revocation of the Winter Keep Scheme? The hon. Gentleman, the Liberal, the Member for Devon North (Mr. Thorpe), may think these matters remarkably amusing, but there are other hon. Members on both sides of the House who attach a great deal of importance to these schemes. If the hon. Member cares to interrupt me I will allow him to do so.

Mr. Thorpe

I am grateful to the hon. Member. He said I find these matters amusing. I find them serious. I do not find them matters on which to call a Count, nor do I find them matters on which to discuss the steel industry. I find them matters arising out of these Statutory Instruments.

Mr. Farr

I was saying that I could perceive that the amount of extra feed which, as a result of these proceedings tonight, the hill farmers will require to purchase could run into a considerable amount, and I was asking the Joint Parliamentary Secretary if he had formed some estimate of the extra requirements of the hill farmers.

Mr. Hoy

I would just point out to the hon. Gentleman that this was why this £5 allowance was made under the hill cow subsidy and the 3s. 6d. for hill sheep for winter keep. If the hon. Gentleman would just keep that in mind he would not require to look for outward signs whether this was taken into consideration or not.

Mr. Farr

I fail to follow exactly the point of that interruption. I was trying to ask the hon. Gentleman if he formed an estimate of the extra amount of winter keep farmers would have to buy, rather than rear it themselves, as a result of these measures tonight. I thought that a perfectly reasonable question to ask.

I could perceive that this extra purchasing requirement could run into many thousands of tons, if not hundreds of thousands of tons, in a season, and yet the Government, in this Price Review, took no step to counter the rapid decline in oats production in this country, and, moreover, cut the price of barley, which today is a very important feedingstuff—

Mr. Hoy

Oh.

Mr. Farr

—by over 5 per cent., although in 1957—

Mr. Deputy-Speaker

Order. I think that the hon. Member is going beyond the Orders we are discussing.

Mr. Farr

I was trying, Mr. Deputy-Speaker, to point out that the Government have given no indication that they were aware at all that there would be a considerable demand for extra winter feed to be purchased from grain-growing counties in this country and that all they had done in the Price Review was to discourage grain growers as far as they could by imposing on the grain growers cuts under the 1957 Act.

Although I find it strange to see them abandoning the Winter Keep Scheme which they welcomed only a couple of years ago, I find it probable that in the national interest, and in the national interest of agriculture, and in the interests of greater efficiency, this scheme is replaced by the type of scheme which they envisage to encourage production of more animals on hill farms and to lead grain growing to areas more suited to it, but I regret that the Minister has not coupled with this desirable move actively encouraging grain growers in our grain growing counties to meet the needs of these hill farmers.

There is one other point I wanted to ask the Minister about. In the reply to a Written Question tabled on 22nd December, 1964, the Minister said that he proposed to end the present scheme of winter keep grant next year. Yet I see in the table given in the Price Review this forecast that in 1965–1966 £3 million will be spent on the Winter Keep Scheme. I should be graceful, in view of the Minister's statement in December last, if he would clarify that point.

11.35 p.m.

Mr. Alick Buchanan-Smith (North Angus and Mearns)

I welcome the contribution that these Orders make to farming in hill areas in Scotland and elsewhere. I am convinced that if we are to utilise properly our resources in these areas it can only be done by giving support in the kind of way that is contained in these Orders.

It is as well to be clear about the main purposes of helping farming in these areas. In the light of the present food situation not only within Britain but in the world, it is clear that one of our chief purposes must be to get an increased supply of beef calves. Mention of this has already been made in the debate.

I should also like to refer to the need to encourage the production of store lambs because, as many hon. Members must be aware, over the last few months and, indeed, over the last year or so, there has been a decline in the numbers of sheep in some of the lower areas which supply store lambs. In particular in the present Price Review there has not been encouragement for this class of low ground store lamb production, and in these circumstances we have to look more towards the hills for the supply of store lambs in the future. In discussing Orders of this nature we must look beyond the purely economic effects. We have to think also of the social benefits which result from encouraging agriculture in these areas in terms of community life and maintaining a reasonable standard of living.

Coming to specific Orders, I should like to refer first to the hill sheep subsidy. I welcome the higher rate of subsidy, but I wish to reinforce the argument of my hon. Friend the Member for Edinburgh, West (Mr. Stodart) in that in increasing the hill sheep subsidy to a rate of 18s. it would have been better if this had been put on a two-tier system and the insurance element of the subsidy had been maintained. There is no doubt that the hill sheep subsidy as it was before had little effect on the hill farmer taking a decision on the number of ewes that he was going to have. It varied very much from year to year and it did not provide a basis for planning.

In this respect I welcome the increase in the subsidy. It will be possible for the first time to use the subsidy as a definite factor in policy which can affect the decisions taken by farmers. On the other hand, we must not undervalue the benefit of the insurance type of subsidy which we had before. I have moved for many years amongst hill sheep farmers. I myself farm on the edge of a hill sheep area, and in a very bad winter such as that which we had two years ago, but for the high subsidies which came in the following year, many hill sheep farmers would have been forced out of production in view of the tremendously high losses.

I ask the Government to consider whether in the future it would be possible to put this subsidy on to a two-tier basis with an element that would carry a steady rate from year to year, to be decided at the Review, and also above that an element of insurance to compensate for bad years. I would imagine that the average of these two elements together would run at something like the 18s. which we are getting in the hill sheep subsidy this year.

Passing to the Winter Keep Scheme, I should like to reinforce what my hon. Friend the Member for Edinburgh, West said, that whilst we welcome the extra 2s. for hill ewes in areas that qualify for the winter keep scheme, I would have thought that there would be a case for giving it also on a headage basis, as an alternative, to hill cattle as well. In areas where one has these sheep one is just as likely to have cattle as well. As the hon. Member for Caithness and Sutherland (Mr. George Y. Mackie) said, to have cattle in those areas as well is often in the interests of good husbandry.

I would ask the Minister of State to look again at the question of the 5,000 farms, at the difference between those eligible for winter keep and those which actually apply for it. The discrepancy is so big that I should be interested to know how it is made up. I appreciate that there are some who do not apply, and also there are some who are very small, but I cannot believe that it is all made up of these elements. If the hon. Gentleman cannot answer the question to-night—

Mr. Willis

That is the answer.

Mr. Buchanan-Smith

—perhaps he will do so on another occasion.

The Government should reconsider the question of dairy farms in upland areas qualifying for winter keep. In certain areas in the Highlands there is a great problem of milk production. Sometimes at certain seasons milk is extremely difficult to get. It may have to be transported over very long distances, and sometimes it arrives several days after it has been produced. There is also the specific point of including barley as a qualifying crop.

I turn to the question of hill cow numbers per farm. I welcome the slightly greater element of flexibility introduced in the Order for England and Wales. I appreciate that for Scotland the attitude has always tended to be rather more flexible. I believe that the decision as to how many cows on a particular hill farm should qualify for subsidy should be related not to the resources of the farm over the whole year, as it tends to be, but to the grazing capacity of the farm in the summer months only. Only in that way can we utilise the resources of the hill farms fully.

I believe that we should take an integrated view of agriculture, and if we are to make full use of our agricultural resources we should have specialisation between different types of farm. If hill farms which have good grazing and can carry cows in the summer are to carry the cows in the winter as well, the type of feedstuff to be purchased is not the kind that we import from abroad of the protein type. It will be largely of the roughage nature, hay, or draff, a byproduct of our existing industries. To this extent it would not put any burden on our balance of payments.

After all, this is a natural thing. This is what happens if a farmer owns a hill farm and a low ground farm; he takes the feed up from the low ground farm to the hill farm. I cannot see why those who farm hill land only and do not have a low ground farm as well should be penalised. If this is done and the decision on how many cows are to qualify for a hill cow subsidy is related to the summer grazing capacity of the farm, we shall get much better utilisation of our resources.

The basic purposes of the Orders are to get more calves and more store lambs. As the Joint Parliamentary Secretary said, we must look at the Orders not in isolation but together, and we must look at all the types of assistance available for hill farms. I support what was said just now about the regeneration of our hill pastures. It is an extremely important point. With a higher rate of grant, we could increase production in hill areas tremendously. As the rate of grant stands, it is simply not worth anybody's while undertaking regeneration. Much more extreme operations are necessary for success. These cannot be financed with the present meagre grant. It often means the expense of moving back into the hills, and the construction of roads to get further back, if we are to be able to use these hill areas properly. Another point in this connection is that of the greater provision of capital for the hill areas. I appreciate that the Hill Farming Act and the Livestock Rearing Act were revoked a year or two ago. I understand that they were revoked because insufficient use was being made of them. It is my contention that insufficient use was made of them because each farm had to undertake a total scheme for the whole farm; it could not undertake a scheme on a piecemeal basis in the same way as the farm improvement scheme.

If farmers were allowed to undertake schemes of this nature on a piecemeal basis, greater use would be made of this and more capital would be put into the hill areas. I mention this because I think that we have to look at all the different aspects of the assistance which can be given to hill farms. If we can put more capital in the hill areas, we shall get far greater return on schemes such as this—

Mr. Deputy-Speaker

Order. I think that the hon. Gentleman is now going rather wide of the Orders.

Mr. Buchanan-Smith

I bow to your ruling, Mr. Deputy-Speaker. I was pointing out how more use could be made of these schemes. Naturally, when public money is being used in hill areas, it is the wish of the House, I am certain, to make sure that the maximum return can be secured for this money. This can be ensured by putting more capital into the hill areas. A great deal more research could be made into the application of improved techniques in these areas on a farm scale. Many such techniques have been developed by institutes and research associations throughout the country. If we could see that they are developed further and if we could extend experiments to a farm scale and not as isolated institute experiments, much more use could be made of them.

11.47 p.m.

Mr. Paul Hawkins (Norfolk, South-West)

Norfolk has not many hills, and it may therefore be wondered why I am on my feet. I have great sympathy for those who come from the areas involved. I drove across Dartmoor a few days ago with my headlights on and wondered how anybody could produce stock in such areas, until animals started looming up on the road in front of me. I welcome anything which can be done to increase beef stores. Norfolk produces a lot of winter yarded cattle and this is a very expensive business. We have lost a large number of Irish stores which used to come into East Anglia, as well as a large number of stores coming from the dairy herds, due to the decreased number of dairy cattle.

The profitability of yarded cattle is extremely low, and because of these new prices, the range of fat cattle in Norfolk, according to most of my farming friends—

Mr. Deputy-Speaker

Order. The hon. Gentleman must relate what he is saying to the Order before the House.

Mr. Hawkins

This is the first time I have debated Orders such as these, and I shall do my best to keep within the rules.

We need the store cattle from hill areas very much. We particularly need crosses. I would support those hon. Members who have asked that non-pure-bred types should receive the subsidy. We do not want the pure-bred Galloways and Angus for the yarded cattle, but we do need the crosses. We need them in large bunches of good types and we need cheaper transport to get them to our areas.

Mr. Deputy-Speaker

Order. There is nothing about transport in these Orders.

Mr. Hawkins

I regret getting out of order. I would merely add that I welcome anything which will produce cheaper and better quality store cattle.

11.50 p.m.

Mr. Timothy Kitson (Richmond, Yorks)

Tonight is very important for the agriculture industry, not only because of this important debate on winter keep and other hill farming problems but also because there have been some interesting discussions taking place across the road at No. 10. I have no doubt that when the Minister replies he will tell us how the leaders of the N.F.U. have got on in their talks with the Prime Minister tonight. We all look forward to learning what has been happening at that meeting and—

Mr. Deputy-Speaker

Order. Not on the Orders before the House.

Mr. Kitson

If the Government had been as generous as the Minister led us to believe they were being when he introduced the Orders I dare say that those discussions would not be going on now. It is relevant to that extent.

Mr. Hoy

Has the N.F.U. been protesting against these Orders?

Mr. Kitson

The N.F.U.—

Mr. Deputy-Speaker

Order. Hon. Members must keep to the Orders.

Mr. Kitson

I hope that the Minister will not consider that the set figure on both sheep and hill cattle, which has been determined for a period of three years, should be too rigid. While I accept that the figure is better than we might have hoped for, but not as good as it was a year ago, we must recognise that in a winter like we had in 1963 the present figure would not be high enough. I hope, therefore, that we will be given an assurance that the Government do not intend to be too rigid about the three-year period.

11.52 p.m.

Mr. Peter Bessell (Bodmin)

At this late hour I do not propose to delay the House for long. I would not like this occasion to pass without saying something on a subject which is of the greatest importance to many of my constituents and to small farmers and hill farmers in the extreme South-West.

The concern expressed by my hon. Friend the Member for Devon, North (Mr. Thorpe) and the hon. Member for Torrington (Mr. Peter Mills) about the exclusion of a number of small farmers and hill farmers from the scheme is a matter which concerns many people. I hope that the Minister will give an assurance on this matter.

I represent an area in which there are a number of small farmers who are excluded from the terms of the scheme and who, therefore, do not benefit under the terms of these Orders. Nevertheless, we are considering something that is a step forward and I do not hesitate to say that, as far as it goes, we naturally welcome it. If we can maintain this progress it will be to the benefit of those farmers who so far have suffered considerably through lack of Government action.

In Cornwall, in my constituency and in the constituency represented by the hon. Member for Cornwall, North (Mr. Scott-Hopkins) there are a large number of hill farmers who are dependent on assistance of this kind. These men and women have been farming difficult land for many years and have had great difficulty extracting a living from it. Despite this, their rate of productivity has been remarkably high. It is a tribute to their ability as farmers that they have been able, in these conditions, not only to produce a living for themselves but to contribute to the nation's wealth in terms of food.

I hope that the steps that have been taken under these Orders will be continued, and that there will be further progress towards giving further assistance to these very hard-working members of the community who farm under the most difficult conditions possible, and who receive a very small return for their labours. I hope, too, that the Minister will give very serious consideration to the problems of those farmers who, by every argument of logic, should be included in these schemes but who, unfortunately, are not able to avail themselves of the benefit of these Orders.

I do not propose to say any more, because I feel that the points have been admirably covered by hon. Members on this side. I only regret that there has not been more heard from the other side of the Chamber, because I am quite sure that people in the agricultural constituencies of members of the Government party will expect to hear that their Members have taken part in a debate which affects their vital interests. As I have said, I believe this to be a step forward, but it does not go far enough. I hope that further provisions will be made in the months ahead.

11.57 p.m.

Mr. Michael Jopling (Westmorland)

These Orders are of the utmost importance to my constituents. Westmorland is one of our largest and most important areas of hill farming. One of the most important changes in the hill farming picture in England and Wales over the next few years was debated last week when we dealt with the Commons Registration Bill [Lords]. I find it strange tonight to follow two Liberal Members—[HON. MEMBERS: "Three."] The hon. Member for Bodmin (Mr. Bessell) and the hon. Member for Devon, North (Mr. Thorpe)—[HON. MEMBERS: "Three."] I will make the point between two and three of them in a moment, if I may be allowed to—because when we discussed the Commons Registration Bill, which only affects England and Wales, many of us were horrified that those Liberal members from the far extremities of Wales and south-west England did not see fit to attend our debate.

Moving to the Orders—

Mr. Thorpe

On a point of order, Mr. Deputy-Speaker. Although the House is no doubt greatly interested to hear of the condition and the emotions registered by the hon. Member on an occasion long past now and no doubt will be anxious to hear about his medical state of health in the future, is it necessary in our discussion of these Statutory Instruments?

Mr. Deputy-Speaker

I was about to draw the hon. Member's attention to the fact that there was nothing about Liberals in the Orders, when I heard him say that he was moving to the Orders.

Mr. Jopling

It is all very well to have Orders dealing with hill sheep and hill cattle subsidies, but I want the Joint Parliamentary Secretary to say whether he can do something to improve the genetic quality of the animals themselves—

Mr. Hoy

If I attempted to reply to that point, I should be out of order also.

Mr. Jopling

I should have thought that when we were talking about subsidies for hill cattle and sheep, it was of vital importance under these Order to discuss ways of breeding the animals and of improving the blood. It is vital that the Ministry should provide its good offices to see whether we can create a pool of the best blood possible for the livestock in our hills—

Mr. Deputy-Speaker

The hon. Member can make incidental reference to them, but he must not go into too great detail.

Mr. Jopling

I am sorry to be out of order, but I should like to move to the Winter Keep Scheme. This is a subject which is very dear to me, because shortly after I first came to the House a few months ago I had the luck to be drawn in the Ballot for Notices of Motion and I was glad to give notice to the House that I would draw attention to the scheme.

This was one of the most burning problems among farmers in my constituency during the last election. I am sorry that the old scheme has been abandoned so summarily. There was a good deal of merit in it. Everyone in the House welcomed the extra help which it provided for hill farmers. There is no question that the type of farmer who most needs help is the small upland farmer, particularly in the remote areas. There is also the marginal land which exists a little way down the valley in many cases which is too good to qualify for the hill subsidies but still not good enough for the farmer to make an easy living out of it. These are the areas where farmers have had disappointing results in the last few years.

One of the main difficulties of the old Winter Keep Scheme, as the Joint Parliamentary Secretary has said, was that whereas about 19,000 farmers qualified for the hill cow and sheep subsidies, only between 11,000 and 12,000 qualified for the winter keep subsidy. This meant that the people who deserved help the most were not getting it. I hope that when the hon. Gentleman winds up the debate he will explain whether he thinks it will be possible to revive in some way the principles of and the good work carried out by means of the old scheme.

There have been several reasons for its failure. One has been the balance between 60 per cent. livestock-rearing land and 40 per cent. for other enterprises. There is no question also that many farmers found it difficult to submit their claims. Many hill farmers, like most of us who make our living from the land, find it difficult to deal with books. We find it one of the hardest parts of farming to have to deal with the office side after dealing with the physical problems. I do not know what experience the Joint Parliamentary Secretary has of farming but I am sure that he knows what we are talking about. I hope that it will be possible for the hon. Gentleman to indicate that he will try to revive in some way the ideals of the old Winter Keep Scheme.

Mr. William Hamling (Woolwich, West)

The hon. Member said that 10 minutes ago.

Mr. Jopling

It is all very well for hon. Members opposite to make remarks.

Mr. Deputy-Speaker (Dr. Horace King)

Order. It is not all very well for hon. Members to make remarks of that sort. I hope that hon. Members will listen to the hon. Member for Westmorland (Mr. Jopling).

Mr. Jopling

I am most grateful to you, Mr. Deputy-Speaker. These are matters of vital importance to those of us who make our living from the land. [AN HON. MEMBER: "The hon. Gentleman should declare his interest."] My interest is well known.

Some very hard cases have occurred from time to time, and I know that the Minister is aware of some of them. Here is an example which occurred under the hill cattle subsidy. A farmer bought a farm some years ago, when milk was in demand, and he pursued a milking policy on that farm. There was no objection from the Ministry, and, in fact, he received certain grants for the purpose. Some years later, the Ministry said that the land was eligible for livestock rearing grant and it complained, milk having become more plentiful by that time, about the milking policy being carried on on the farm. In fact, the Ministry threatened that, if the policy was pursued further, the grants already paid might have to be refunded, its reason being that, although the land was eligible for livestock rearing grant, it was not suitable for milk production.

Some years after that, the livestock rearing grants were withdrawn from the farm. The Minister knows that this sort of thing has happened on many farms in the past year or two. In response to his protest, the farmer got the quite astonishing reply that, whereas his farm was formerly suitable for livestock rearing, it was now suitable for dairying, cash cropping and fattening stock. I have seen that farm, and I simply cannot understand how anyone could attempt to make a living out of it by dairying or cash cropping.

Mr. Deputy-Speaker

Order. I have listened to the hon. Gentleman for some time, but I have not seen the relevance of what he is saying. He must link his observations to the Order.

Mr. Jopling

With respect, Mr. Deputy-Speaker, the relevance is that, under the Order, there is land which qualifies and land which does not for the hill cow subsidy. At one time it was said that this particular farm was in and at another that it was out. The way these matters are worked is of great importance to my constituents. I am glad to have had the opportunity to raise these points, and I hope that the Minister will be able to give a satisfactory reply.

12.3 a.m.

Mr. James Scott-Hopkins (Cornwall, North)

We have had a wide-ranging debate, and I am sure that the speeches of my hon. Friends will have shown hon. Members opposite how serious and important a subject this is for those farmers who are affected by the way these hill subsidies work and by the withdrawal of the old Winter Keep Scheme and the substitution of various other measures for it.

The Winter Keep Scheme was brought in in 1963 in order to help farmers on the hills to improve not only the land which they themselves were farming but also the land on which their stock was grazed, sometimes common land. The scheme has, I think, been a success, although there have been difficulties, particularly higher up the hills.

My hon. Friend the Member for Torrington (Mr. Peter Mills) and the hon. Members for Devon, North (Mr. Thorpe) and for Bodmin (Mr. Bessell) have referred to the farms which have been cut out from the various schemes. The main point is the definition of eligibility.

Hon. Members will, I am sure, agree that there should be comparability throughout the country. That should be the basis. I am not at all sure, however, that what the Joint Parliamentary Secretary said in opening the debate to the effect that more farmers will receive the additional hill cow subsidy of £18 is exactly right. As I see it, we come back to the question of definition both for the hill cow subsidy and for winter keep as it applies until tonight's scheme takes effect. Both are exactly the same.

I will not read the definition as laid down on page 2 of the 1963 Winter Keep Scheme because it is well known to hon. Members who are interested in these matters. That definition is exactly the same as for the hill cow subsidy payment areas. It is on that livestock rearing land, which is known as eligible land, the hill cow subsidy and the supplement are to be paid. The subsidy is to be paid only for the eligible land.

The definition for the Winter Keep Scheme was exactly the same. Provided however, that a farm had both eligible and non-elegible land—land which qualified and land which did not—if 60 per cent. of the farmer's income as shown on his return was derived from the hills and not from barley, potatoes and milk, he qualified for the winter keep subsidy for the whole of his farm. My understanding is that as a result of the abolition of the former Winter Keep Scheme, that farmer might well receive less subsidy under the new Scheme because the extent of his eligible land might be quite small in total. I should like the Joint Parliamentary Secretary to confirm whether in that case the farmer will receive less subsidy.

One wishes to make certain that nobody will suffer. It was not the intention of the Minister or of the Joint Parliamentary Secretary that a farmer should suffer as a result of the new Scheme. We need to establish clearly what the payments will be. For example, on the occasion of the review of which hon.

Members from Devon constituencies have complained, several farms in the Holsworthy area in particular were taken out of the Hill Cow Scheme; they were not in the livestock rearing area. By a special extension of the scheme in 1964, however, my right hon. Friend the Member for Bedford (Mr. Soames), the Minister's predecessor, brought back the Holsworthy area within the scope of the scheme so that farms which qualified under the new definition were eligible for the hill cow subsidy on a special basis. Will those farms continue to be eligible and will they qualify for the increase, as I imagine they will? I ask only so that it may be made plain that these farmers will be eligible.

My hon. Friend the Member for Edinburgh, West (Mr. Stodart) spoke about the hill sheep land. Will the Joint Parliamentary Secretary confirm whether the land which is eligible for hill sheep subsidy is exactly the same as the eligible land for the hill cow and winter keep subsidies? I have a suspicion that the hon. Gentleman will find that the definition is not exactly the same.

I remember, when I dealt with these matters in former days, the subtleties of definition of the land which qualified for payment. There was a subtle difference between the definition of land which was eligible for the hill cow subsidy and that which qualified for the hill sheep subsidy. Perhaps the Joint Parliamentary Secretary will explain whether that still applies.

I hope that the Parliamentary Secretary will make a point of saying that the £6.2 million to increase the hill sheep subsidy is included in the Annual Price Review for the first time and is part of the £10 million plus which the Minister has put before the House and the country. This is rather an underhand way of making up the figure of £10 million plus, because on last year's basis this £6 million would not have been included in the Price Review determination. Page 40 of the White Paper says specifically that for the first time in the 1965 Annual Review the hill sheep subsidy is being included. I am sorry that the Minister and the Parliamentary Secretary have been saying that the figure was £10 million plus, comparing it with the previous year's figure, because it is not. It is a straight addition of £6 million for the hill sheep. It is now in hand and it is a good thing to have, but the figures are not comparable. In the 1964 Review there was an increase of £6.3 million which was not included in the £34 million plus increase of that time.

It is right that we should have covered almost every point of importance to the hill farmers and I hope that the Parliamentary Secretary will be able to convince us that what he is doing by raising the hill cow subsidy by £1 and the supplement, to take the place of the winter keep grant, by £5, making the whole £18, with 21s. for a ewe, is enough to stimulate the growth of productivity on the hills. If we are to get increased productivity we shall have to increase stores and have better grazing in the hill areas. This can be done only by grants such as the winter keep, so that these farmers can be enabled to farm these difficult upland areas and put in proper seeds and use proper fertilisers and work the land as far as they can and as much as they can. This is vital.

I am sorry that the old Winter Keep Scheme has been abolished. I am glad that the cow subsidy has been increased to £18, but I wish that the Minister had done something for those farms a little down the hill where cultivation is possible and for those on common lands such as Bodmin Moor mentioned by the hon. Member for Bodmin where many of his constituents live and work. I wish that some kind of winter keep grant had been kept for farmers in the difficult areas to encourage them to go ahead and increase their productivity on this hard and difficult land.

I am sure that the scheme has been worth while and that it would be valuable to have such a scheme related not only to the livestock rearing areas, but to the areas further down the hill, strengthened by the advice of the N.A.S. or the Agricultural Land Services, which-ever was preferred. I hope that the fundamental review of which the hon. Gentleman spoke will not take too long and that its results will include constructive proposals to help farmers in these areas to increase their productivity. I am sure that the winter keep grants would have been one of the best ways in which to do so.

The farmers who are to receive the hill sheep subsidy and the addition to it will want to be certain that the arrangements about the percentage of hill flocks have not been changed, that is to say, as between the sheep qualifying for the subsidy and the flock on the lower rate. I hope that the Parliamentary Secretary will also deal with the point of my hon. Friend the Member for Gainsborough (Mr. Kimball) about broken-mouthed ewes in the flocks in England and Wales and maintaining the balance. I am sure that this is of importance if we are to improve the type and quality of the flocks running on the hills. On the whole, we are glad that these grants are being made. I still regret that winter keep has not been kept in a modified form, but I am certain that those on the hills will take the maximum benefit from this and try to reach the target the Government are setting.

12.20 a.m.

Mr. Hoy

The hon. Gentleman asked about our bringing forward some fundamental proposals for dealing with the upland areas. Goodness knows that hon and right hon. Gentlemen opposite were in office for a time and we have been there only six months. One would have thought that if it was as urgent as that the hon. Gentleman would have done something about it.

We are having to carry out a fundamental review to see how to get the best out of the hills and the uplands. We believe that the farmers in these areas should make their contribution to the obvious needs of the country. I was surprised to hear the hon. Gentleman the Member for Edinburgh, West (Mr. Stodart) speaking about the ever-increasing demand for meat, year after year. The previous Government did nothing about it in their Price Reviews. We have added this £1, and he says it is not enough. It may not be, but at least it is an improvement.

That is not the end of it. A complete answer is that we must look at the broader picture of all the increases the Government made at the Annual Review to encourage a moderate expansion of the home production of beef. There has been an increase in the guaranteed price of cattle of 4s. per live hundredweight, an extension of the calf subsidy, an increase of 10s. in the rate of the subsidy and, thirdly, an increase in the hill cow subsidy which we are dealing with tonight. We can only hope that it will be of some help to the industry and to our meat supply.

Hon. Gentlemen opposite have said that they regretted that we did not carry over at least a part of the old Winter Keep Scheme. In lieu of that scheme, there is going to be this supplementary payment. It is not that the Government has said "You are going to have it, whether or not you want it". This was reached in agreement with the N.F.U. and all the people concerned. It was one of my jobs, as Chairman of the Hill Farming Advisory Committee, to go into this with all the farmers concerned on the N.F.U. They all thought that this would be a better way of dealing with the problem. That is why these headage payments are to be made. If, instead of using this money to buy winter keep, they want to use it for cultivation they are at liberty to do so. There is nothing to prevent them doing so, and I hope that they will.

I understand the problems of certain farms which have been excluded from the hill cattle scheme. In fact, I have corresponded with all the hon. Members who have raised the matter tonight. Perhaps they might have added that in a few cases—and it must be remembered that these farms were excluded before we took office—we were able to do something to rectify the situation and put back people who had been left out. I am not saying that that was done in many cases. [HON. MEMBERS: "Not enough".] It really is extraordinary. Hon. Gentlemen opposite were responsible for excluding these farms, and we have included some again. I should have thought that they would have been grateful for what we have done. I cannot make firm and fast promises, but we are well aware of the problem that certain farms do not qualify because of the test of eligibility.

Let us be fair about this. Criticism should not be levelled at the county agricultural executive committees and their panels who go to inspect. On every occasion when it was necessary to exclude a farm the matter was dealt with in the fairest possible way. The issue was not decided merely by a cursory glance at the farm. There was a careful inspec- tion to make sure that the decision was the right one, and I pay tribute to those committees and panels for the work which they have done.

I give the House the assurance that these difficulties will be considered during our review, but I think that it would be foolish of me to make any promises tonight, and to say that I can assure all concerned that these matters will be put right. Nobody in this House could say that. All that I can do is to assure the House that these problems will be considered.

The hon. Member for Torrington (Mr. Peter Mills) asked whether the stocking rate was fixed permanently. As I said in my opening speech, the maximum ratio is 1 to 5. Whether farmers have any more on their land or not, the subsidies will be paid on that ratio. That is the ratio which has been fixed, and what we have done is to increase it on this occasion—I agree not by very much—but to that extent the farmers will benefit. According to my information, few farmers have this maximum ratio, but what we should like to do is to encourage them to get up to it.

I was a little surprised when the hon. Member for Gainsborough (Mr. Kimball) asked what type of sheep would be eligible on the hills. The answer is exactly what the Order says, and what the Act says—hardy sheep. Anybody who is interested in this subject knows which breeds are permitted under these rules. In fact, some small alterations have been made with regard to the type of sheep permitted on the hills. It is not the Government who define what is a hardy breed. I am sure that the hon. Member for Cornwall, North (Mr. Scott-Hopkins) will bear me out when I say that his noble Friend, who was Chairman of the Hill Farming Advisory Committee, knows that we meet farmers concerned and then decide which breeds should be admitted for the purpose of the subsidies.

The purpose of the subsidies is to maintain hardy sheep and hardy cattle on the hills. It is true that hon. Gentlemen opposite think that one or two other breeds ought to be included, but I take the advice of farmers in this matter. They know whether the breeds are hardy in the accepted sense. The hon. Member for Gainsborough might be interested to know that some research has been carried out to find suitable breeds, and that it has been decided to learn a little more about one type before deciding whether or not it should be included. I assure him that there is no rule which debars a breed if it qualifies as a hardy sheep, and if it is accepted there is nothing which will keep it out of the scheme.

The hon. Gentleman the Member for Edinburgh, West asked me about the 18s. and the 3s. 6d., and I will just reply by saying that anybody who qualifies for the 18s. will get the 3s. 6d. as well.

The hon. Gentleman the Member for Harborough (Mr. Farr) had a great deal of difficulty in getting to the point of the Orders at all. He said that, while we were abolishing winter keep, apparently there were no visible signs that we were replacing it. I found this very difficult to understand, because there was not another Member in the House who had not understood that the £5 and the 3s. 6d. were being paid for the very purpose of providing winter keep. They are a substitute for the old scheme. Farmers get this money to buy keep if they cannot grow it for themselves, but, as I said, if they want to use any part of this for cultivating their own winter keep, then they are at liberty to do so.

The hon. Gentleman really was going a little far about the grain agreements. I do not want to get out of order, but I would just say this to the hon. Gentleman, that he knows perfectly well that these grain agreements, whether we agree with them or not, whether we like them or dislike them, were agreements entered into by his own Government. I am not criticising them for that, but they were the people who entered into the agreements with their international friends—

Mr. Farr

Not the growers as well.

Mr. Hoy

With all due respect—but I had better not take this too far, and I will finish by saying that they were entered into by his own Government, whom I am not criticising, and with the agreement of the N.F.U., and so if we are maintaining these agreements the hon. Gentleman must not come along and complain, unless he argues that the agreements are all wrong and ought to be renegotiated.

Mr. Farr rose—

Mr. Hoy

No. I have given way—

Mr. Deputy-Speaker

The point which the hon. Member raised was out of order, and so the answer must be out of order. We have discussed this point enough.

Mr. Hoy

Yes. As I was saying, I was simply replying to the hon. Gentleman because he had great difficulty in getting to the Order at all. He got it all mixed up with steel, and he tried to call a Count. I was not very sure what he was after tonight.

The hon. Gentleman the Member for North Angus and Mearns (Mr. Buchanan-Smith) was quite generous, I think, in welcoming the Orders tonight and the help to the hills. He also called for a considerable amount of research which, he said, was still required to be done. I am not denying that research is called for. All I would say to him is that if this is to be done there are certain agencies for carrying it out. Improvements will have to be made, and this will be looked at in the course of the review. As he will agree, a great number of things will have to be reviewed. All I can give him assurance on tonight is that this will be looked into.

One other question which was raised was that of losses in disaster years. We have never laid down in the Regulations that during a year of disaster a certain payment will be made. What we endeavoured to do was to fix this flat rate of subsidy, which, I will say quite confidently, is welcomed by all the farmers concerned—welcomed by them all because it lets them know exactly what their income is to be, and allows them to plan ahead. We have had disasters in years gone by, and I remember them quite clearly, and on two occasions I remember that special measures had to be taken by the Government of the day to meet the situation. I have no doubt at all that in similar circumstances, if disaster did overtake us, any Government would take action of the same kind. Quite obviously, however, we cannot legislate for disaster years. We can only legislate for what we think is likely to happen.

Mr. Kimball

I would draw the hon. Gentleman's attention to the fact that the subsidy rate is fixed four years in advance. If we get a series of increases in shepherds' wages, will this also be taken into account so that we can still have an increase in the hill sheep subsidy, which is 5s. below what it was last year, in spite of the fact that there has been a 10s. increase in wages?

Mr. Hoy

The hon. Gentleman is asking me to go a little too far tonight in saying whether there will be any alteration in the subsidy to take account of any change in wages in the next four years. This is a matter for the Price Review. No other Minister, in any party, would come to this Box and say that there would be an alteration in any of these Orders if there were a movement in farm workers' wages

Mr. Scott-Hopkins

This is the point that we want to get clear. Under the present system one takes into account the profitability of the flock on the hills. If there is a bad profit year there will be a higher subsidy. What my hon. Friends are worried about is this. If in a certain year profitability were low for any reason, could the hon. Gentleman say that by means of a future Price Review the subsidy could be raised?

Mr. Hoy

This flat rate has been fixed. I am not saying that it is fixed permanently, but we have entered into an agreement. We have not been ungenerous. Over the past five years it has worked out at 9s. 6d. per head. We are now giving 18s. It is true that in the worst year when there was a disaster, it was 25s. But when one considers the 3s. 6d. headage on top of the present rate, it is not ungenerous.

The hon. Member for Edinburgh, West has had to leave for another engagement, but, arising from his remarks, I should like to put on record that the cost of the hill sheep subsidy will be £4½ million.

The hon. Member for Gainsborough asked about old ewes, and my reply to him is that no subsidy is paid for them.

I do not think I can add much more to what I have already said. I have tried to cover as many of the points as I can.

Mr. Scott-Hopkins

Would the hon. Gentleman deal with one point? He seems to be in some difficulty over the cost of the hill sheep subsidy. The White Paper refers to £6.2 million. While the hon. Gentleman is dealing with that point, would he also answer my question about the Price Review figures for the hill sheep subsidy?

Mr. Hoy

I can go no further tonight. It has never been the custom to disclose how the figures are made up. I will consider the hon. Gentleman's other point.

Mr. Kimball

Before the hon. Gentleman sits down—

Mr. Deputy-Speaker

Order. The hon. Gentleman has sat down.

Question put and agreed to.

Resolved, That the Winter Keep (England and Wales and Northern Ireland) Revocation Scheme, 1965, a draft of which was laid before this House on 27th April, be approved.