HC Deb 17 January 1967 vol 739 cc219-31
Mr. Henry Clark

I beg to move, Amendment No. 41, in page 31, line 9, at the end to insert: (d) may allow income derived from land taken under a short-term letting to be included with an individual's income from the land he relinquishes for the purposes of a test under the last preceding subsection. It might be convenient if, with this Amendment, we considered the following Amendment No. 42, in line 9, at end insert: (e) shall not exclude an individual who relinquishes an uncommercial unit which provides when farmed under reasonably skilled management employment for one man on one hundred days per year.

Mr. Speaker

If there is no objection. so be it.

Mr. Clark

The Amendment has been tabled in an effort to adapt, as far as is possible, this part of the Bill to the land tenure system existing in Northern Ireland. This is not the place, nor this the hour, to detail the unfortunate effects which the imposition of an English land tenure system has had in Northern Ireland, although I spoke for a considerable time in Standing Committee on this issue There were occasions in Committee when I suspected that some hon. Gentlemen opposite had lost track of the subject although it is of great interest to my hon. Friends.

I will jump the first 300 years of Irish history and merely comment that we were left at the end of the last century by the Land Acts a very large number of small, individually owned holdings and virtually no leasehold farms as such holdings are known in this country. The factor which makes this system of a large number of very small holdings work satisfactorily is that as well as individually owned holdings, we have a widespread system of annual letting; a system known as the "conacre". I notice the use of the expression "conacre" in a Government Amendment. Perhaps I have achieved something; at least I have educated the Ministry in the use of a piece of good English. I begin to think that our 26 sittings in Committee have not been entirely wasted.

The "conacre" system is a simple one. Land is let for 11 months in the year and it can be let not only for grazing but for any arable purpose. These lettings bring in rents of from £5 to £18 a year, depending on the land, its state, the state of the fences and the crop grown on it. The result is that a young and active farmer may frequently own only 10 or 15 acres, but will take on an annual letting—he may take the same land year after year—of 20 or 30 acres. He will, therefore, actively farm 30 or 40 acres, although he owns only 10 or 15 acres.

1 a.m.

This is the case with which the first Amendment is designed to deal. Quite obviously, if a young, active farmer is taking in land to increase his holding, we have, at the same time, the more elderly farmer who is thinking of retiring on the rents he obtains by letting his land, or part of it, to more active neighbours. We may very well have a farmer who is farming, perhaps, only two or three acres of land of his own, with a few hens and pigs, but who in his heyday was farming some 30 or 40 acres. As I see it, both the old farmer who is letting off some of his land and the younger farmer who owns only a very small holding but farms quite a large area are people who come well within the definition contained in the White Paper.

That is the only definition we have had of the Government's intentions. In the Standing Committee we heard remarkably little of their intentions. Both men come within the third category in paragraph 3 of the White Paper, which states: The Government therefore propose to offer these men help in three ways… and the third way is: …to resettle or retire from farming where they want to give up an unrewarding struggle. I would not myself use those words, but I want to see that the older farmer who retires can do so in a reasonably dignified manner, if not prosperous at least with a comfortable level of income.

I equally believe that the young active man who owns only a small amount of land hut who farms 30 or 40 acres, and who wants to give up what the Government call the "unrewarding struggle",

should have every incentive to move into another profession and settle in it with the same benefits as any other farmer. I have put down these Amendments because both those people could be eliminated from schemes under this Clause. That is why Amendment No. 41 states that a scheme

…may allow come derived from land taken under a short-term letting to be included with an individual's income from the land he relinquishes for the purposes of a test under the last preceding subsection. The last preceding subsection is (c), which states that a scheme under this Clause …may apply to the individual a test by reference t0 the income…derived from land the occupation of which he relinquishes… What that test will be we had no indication in Committee, so without that information we must try to protect ourselves and make certain that the test does not work in the wrong way. The man who owns 10 acres and actually farms 30 acres gets only one-third of his income from the land he relinquishes, and if the test—and we do not know what it is—is applied in a particular way, that young, active farmer could well not get the benefits which this Clause seeks to give him.

This is perhaps an obscure point to those who do not know the Northern Ireland system of farming. I believe that it is unique to Northern Ireland, and is not experienced anywhere else in the United Kingdom, but it is a completely relevant point, and one on which I hope I shall get a satisfactory reply from the Minister. The most satisfactory reply would be simple acceptance of the Amendment.

The second case is that of the farmer who has been very active in his day but has now retired, living on his land, perhaps 10 or 15 acres, with a little from the farmyard. We want to give that man a descent and respectable retirement. In fact, though the White Paper does not say so, it quotes various Continental schemes for the retiring farmer, and anyone who has studied these things knows that in most Continental schemes there are specific pensions for retiring old farmers. Very often these people are women who live on the relatively small holding. They may be the widows of farmers who have died some time ago.

These are the very last people who should be excluded from the scheme. But on the second page of the White Paper we read in paragraph 7(a): A minimum size of business would have to be laid down to exclude holdings which are not genuine farms… We have had no indication of what that minimum size would be. In Committee I suggested a minimum size, which was rejected by the Joint Parliamentary Secretary because he said that he did not believe in defining sizes in terms of acres. I have taken his advice and in Amendment No. 42 I have suggested a minimum size of 100 man days. I did this after consultation with the Ulster Farmers' Union which is very familiar with these conditions, and we agreed that this would he the minimum size—a farm of eight to 10 acres.

I hope the Joint Parliamentary Secretary will be able to accept both these Amendments. They improve the application of this part of the Bill to the conditions in Northern Ireland. If he does not accept them, there is a real chance that when the schemes are applied, injustice will be done.

The Marquess of Hamilton (Fermanagh and South Tyrone)

I wish briefly to reinforce the points made by my hon. Friend the Member for Antrim, North (Mr. Henry Clark), and I hope that the Government will accept these two extremely important Amendments.

The Government should appreciate and accept that farm structure and tenure in Northern Ireland are completely different from anywhere else in the United Kingdom. As my hon. Friend has said, we have no landlord and tenant system. In its place we have short-term letting known as the conacre system forced upon the industry by the size of farm holding.

There is a tremendous disparity between the size of farm holding in Northern Ireland and the rest of the United Kingdom. In England the average size is 80 acres; in Northern Ireland it is 32 acres. In my constituency there are many holdings of not more than 10 to 15 acres. Therefore, a small farmer is forced to take land on a short-term letting in order to provide a livelihood for himself. Very often at least two-thirds of his income is derived from these "conacre" lettings. As the Bill stands, the income derived

from the letting could exclude the tenant from paragraph (c), which would be grossly unfair, due to prevailing circumstances in Northern Ireland.

Mr. Hoy

I am grateful to the hon. Member for Antrim, North (Mr. Henry Clark) for raising this matter. We discussed it in Committee, and tonight he has had the additional support of a noble Lord.

While I sympathise with the intention behind the hon. Member's first Amendment, we must keep in mind what we are trying to achieve. The aim of the grants under Clause 27 will be to assist those who are dependent on small farms and wish to give up the land for amalgamation. In Great Britain land can only be let for less than a year with the Minister's consent or on a mowing or grazing licence. Someone who takes land on a short-term letting does not depend on it for his living, nor does he need help to give it up. He may not even be able to rent it again. The land is not a permanent part of his farm and does not contribute regularly to his income. On the other hand, an elderly farmer who rents out land for a short period to one neighbour or another may indeed depend for his regular income on that land. The land forms part of his farm, and when he regains occupation could be given up for amalgamation by him, along with the rest of his land. I am afraid that we could not see our way to count such land also as part of the regular income of any neighbour who may rent it for a short period.

If hon. Members will think this out, they will see the reason why.

Mr. Henry Clark

I should be very interested to have some details of the test which is to be applied to income under subsection (3).

Mr. Hoy

I was dealing with the general issue. If one takes the case of an elderly farmer who rented out part of his land, then what we are saying is that, when he took it back he would be able to sell it along with the rest of the land and make up an amalgamation. Quite obviously, the other man would have rented it for a particular purpose. The land had reverted to the farmer, and in the second Amendment, the hon. Gentleman said that quite clearly there should be a lower limit on the size of an uncommercial unit whose relinquishment could qualify an applicant for grant under this Clause. Let me put it another way —and I suspect that this is what the hon. Member really has in mind—by saying that the Amendment would set an upper limit on the size of uncommercial unit which could be excluded from an outgoer's grant.

Three points have to be considered here: whether such a limit should be imposed and, if so, what it should be, and where it should be specified. I think that it is generally agreed that there should be provision for such a limit, and we intend to set such a limit in the first statutory scheme.

So far as the level at which any limit should be set is concerned, I must tell the House that I would rather not commit myself at this stage. We have already said in Standing Committee that an acreage limitation would be inappropriate because land varies so much in quality. Standard man-days would obviously be preferable, and I would agree that, to this extent, the Amendment is on something like the right lines. I would also agree that the level of a 100 man-days suggested in the Amendment is reasonable, and I promise to bear it in mind, but I do not think that it would be right to put that figure in the Bill and be tied to it inexorably for the life of this legislation. The place for this sort of detail is in the statutory schemes to be made under this Clause, because we want to be able to adjust conditions in successive schemes if conditions at the time require this.

I can tell the House that there need be no fears that any limit set will be at such a level as to exclude real farms on which the occupier is mainly dependent for his livelihood, but which he needs help to leave. One of the prime objects of the farm structure proposals is to give assistance to such people, and it would be against our interests to exclude them.

I hope that the House will agree that the Bill should be as flexible as possible on this point. I gladly repeat my assurance to bear in mind the limit suggested when the first statutory scheme is made, and I ask the House to reject this Amendment.

Mr. Stodart

The Parliamentary Secretary will remember that I lent him some of my support in Standing Committee when speaking of the acreage qualification, because I agree with him that one can get so badly misled when one is thinking in terms of acreages. That is simply because acres differ so very much. On the other hand, I have a certain amount of sympathy, and more, with my hon. Friend, because having gone against my hon. Friend in Committee I had hoped that the Parliamentary Secretary would feel able to accept the Amendment which my hon. Friend has now put forward, which is really very much in line with what the Parliamentary Secretary himself suggested. He said: What we have in mind is a minimum in terms of standard man-days—…—perhaps half of a man's time, or something like that." —[OFFICIAL REPORT, Standing Committee A, 27th October, 1966; c. 777.] That is pretty well what my hon. Friend has put down.

1.15 a.m.

I agree that the Parliamentary Secretary has said that this is very much the way his mind is working, but I think that it is always a good thing to accept Amendments now and again. Perhaps the Parliamentary Secretary thinks otherwise. But as we have the virtual assurance that that is what will happen in the scheme I dare say that we should be thankful for small mercies and leave it at that.

Mr. Henry Clark

I thank the Parliamentary Secretary for the very thoughtful and careful way in which he replied. In answer to one point he raised, I would point out that my second Amendment seeks to state an upper limit to small farms which might be excluded. I should like a fairly firm assurance that it will he a very small farm indeed that will be excluded from this. It is particularly the words in the White Paper which give me some reason for doubt: A minimium size of business would have to be laid down to exclude holdings which are not genuine farms; One can have a genuine farm of very small size in Northern Ireland—well under 10 acres. It has given me some qualms to hear various hon. Members speaking of small farms of 30, 40 and even 80 and 100 acres. Those are large farms by our standards. In view of the answer, I do not particularly want to press the Amendment, although I think that it would considerably improve the Bill.

I am not entirely content with the reply to the first of my Amendments. The object of the Bill, as stated in the White Paper, is to help people who want to give up what the White Paper calls "the unrewarding struggle" and to be resettled.

The man I hypothesised, who owns 10 acres and who has regularly farmed about 30 acres each year by taking land in on annual letting, is a genuine farmer who gains the whole of his livelihood by farming and wishes to get out of farming. When he leaves farming, that 30 acres he has farmed year by year will become available for amalgamation with other units. I believe that there is a very strong case for that man not being excluded, and I am not certain from the Parliamentary Secretary's reply that the test under subsection (2,c) would not exclude him.

Under that test, as I understand it, the man who is receiving only one-third of his income from the land he relinquishes could be excluded. I believe that if Amendment No. 41 is not accepted we may find that subsection (2,c) does quite considerable injustice to people in Northern Ireland. I ask the Parliamentary Secretary to look at this again and, if he is prepared to say that he will do so, I would be prepared to withdraw the Amendment and hope that something might be done in another place.

Mr. Hoy

I thought that I made our views on this explicitly clear. I said that a man who had let out a farm or a part of a farm might want to get out of farming, and it would be possible for him then to sell the farm as a whole for amalgamation purposes. He might be an old farmer who wished to do this. But there is a great difference in saying to a man who only rents land that these conditions will apply to him in respect of all that land—which is not a permanent part of his farm. We do not have the right to do this. Those two cases are quite different.

Amendment negatived.

Mr. Henry Clark

I beg to move Amendment No. 43, in page 31, line 28, at the end to insert: (7) The Minister shall have regard to the current level of rents for short-term letting and current land prices in fixing level of grants in any scheme under this section. This Amendment seeks to bring the Minister's policy as stated in the White Paper more into line with the actual reality of farm values. It is fortunate that it comes so close after the others that I have just dealt with because I have been able to tell the House a certain amount about the circumstances that exist, and my noble Friend has been able to help the House as well. We have a peculiar system of land tenure in Northern Ireland and in many cases a particularly high level of annual lettings.

In the case of a small farmer with 20 acres who is largely retired and is living on the land which he lets annually, the 20 acres could well produce £200–£300 a year. But if he sells the 20 acres, under the level of grants laid down in the White Paper he will either be worse off, or only marginally better off, and he ceases to be a landowner. The level of grant in the White Paper provides remarkably little incentive for the man to sell up.

Though I am anxious that the man who sells his land should continue to stay in his house, in a large number of cases it will prove to be impossible and the man will have to find a house elsewhere, and the capital value of the farm that he sells will only just provide him with a reasonable house off the farm. Therefore, the man with 20 acres who is leaving the land will have a very small pittance. He will get his £100 and £1 per acre—£120 per annum—and he will probably have enough money to get himself a house. But even if he is able to invest the capital sum that he gets through selling the farm he will not be particularly well off.

It is worth remembering that a very large number of people who might be in this situation have been excluded from the old-age pension arrangements and in many cases equally well excluded from National Assistance because of the ownership of capital, so if they accepted the scheme and compensation at the rates laid down, they would find themselves worse off in many ways than they were before they sold the farm. Unless the levels of compensation are raised—they should be double those suggested in the White Paper—I do not think that the scheme will be successful.

I went on record in Committee saying that we do not want a revolution in the farming of Northern Ireland. We do not want 2,000 amalgamations a year. We want at most twice the 700 or so amalgamations that now take place each year in Northern Ireland. If we are to get a higher level of amalgamations than at present a higher level of grant must be given. If an annuity were paid to a farmer for relinquishing his farm of £200 plus £2 per acre we should be making the payments under the scheme conform to the value of annual letting of a farm. I believe that if the Minister looks carefully at the value of land and at the rents that are received for short-term letting in Northern Ireland, he will see that the amounts laid down in the White Paper are insufficient to make the scheme work effectively.

The Marquess of Hamilton

Clearly the Minister must think again about the proposed scale of compensation for the so-called "golden handshake". In Northern Ireland, there will be few takers at the present scale. I doubt whether it will tilt the balance towards decisions already made in principle. Due to the credit squeeze and the Government's harsh deflationary measures, there is at least 10 per cent. unemployment in most rural areas of my constituency. As a result, farmers will be far more reluctant to accept this "golden handshake" than their equivalents in England, for they would find it much more difficult to obtain alternative employment.

The proposed scale is clearly inadequate and if the Minister is really determined for this scheme to prove successful then the lump sum should be increased by 50 per cent. and the pension rate raised to the equivalent of £5 per week for life.

Mr. Hoy

I shall not attempt to go into the question of unemployment in Northern Ireland, which has nothing to do with these provisions. It was quite unworthy of the noble Marquess, the Member for Fermanagh and South Tyrone (The Marquess of Hamilton) to introduce an argument of that kind at this time of the morning.

The hon. Member for Antrim, North (Mr. Henry Clark) did manage to refer to the White Paper. What the White Paper proposed and the final figures arrived al are different matters. It will depend on the terms which will help people to do certain things. What the hon. Gentleman is seeking is an assurance that we will review the rates of grant from time to time in order to ensure that they remain in line with the general level of prices and offer a reasonable inducement. I gladly give that assurance.

But it is not so obvious that it is the level of rents and land prices that will determine what constitutes a reasonable incentive. There are still a large number of elderly tenant farmers who may wish to take advantage of these grants. Not everyone owns land he can let. We shall, therefore, fix the rates at whatever level we consider reasonable from time to time.

I would also say that it would be most unfair to people who take advantage of the scheme if we changed the rates too often or too sharply. We shall therefore try to fix a reasonable figure in the first scheme and keep to it for a considerable time. I gladly give the assurance the hon. Gentleman seeks and I hope that he will withdraw the Amendment.

Mr. Stodart

I am a little surprised by what the Joint Parliamentary Secretary has said because he has given the clear impression that the rates quoted in the White Paper and those which may be paid may be different. In Committee he said: If the proposals in the White Paper are not considered reasonable, I am a little surprised that no suggestions have been put forward. We put our proposals down in the White Paper because obviously some guidance had to be given to people to let them know the lines along which we were thinking."—[OFFICIAL REPORT, Standing Committee A, 27th October, 1966; c. 795.] I drew the conclusion from that—and I am relieved to find it wrong—that the rates were, more or less, within possible slight variations, to be the rates in question.

Neither I nor my right hon. Friend have ever failed to say that, while we approve of the general principle of amalgamations and of these grants, we are not happy about the levels proposed in the White Paper. We have always felt that, as my hon. Friends have said, they would not be high enough to do the job intended. However, if I now inter- pret the hon. Gentleman differently—and I am not saying that it was not my fault if I interpreted him incorrectly—I am glad to hear that there may well be substantial increases over the level of grants announced in the White Paper.

1.30 a.m.

Mr. Hoy

I do not want to mislead hon. Members. I said that there might be changes. We discussed this subject very fully in Committee and I remember one hon. Member opposite saying that he thought that the figures which we had produced were just about right. There has been this difference of opinion. We shall have to wait and see what the final figures are. I was asked for an assurance that they would remain in line with the general level of prices and offer a reasonable inducement, and I said that I gladly gave that assurance. These things will be taken into account when the arrangements are made.

Mr. Henry Clark

The Parliamentary Secretary has made one or two comments which will bear reply. He is quite right in thinking that in this Amendment I tried to tie the grants and the lump sums to some reasonably flexible yardstick which would bring them close to reality and close to the level which the man concerned could expect to get from an annual letting. I am thinking largely of Northern Ireland and a large percentage of cases will be in Northern Ireland, but these things will be relevant to any man contemplating leaving his farm and trying to find another job somewhere else, just as they will be to the man who is thinking of retiring.

I am rather surprised by the slightly synthetic indignation which the Parliamentary Secretary directed towards my noble Friend the Member for Fermanagh and South Tyrone (The Marquess of Hamilton). The question of unemployment is directly relevant and if the Parliamentary Secretary does not understand that, then he has no business being in his present job. My noble Friend was not exaggerating when he spoke of 10 per cent. unemployment. There are parts of my constituency where the unemployment rate runs at about 15 per cent. Leaving a farm may mean moving one's home 50 or 60 miles to an area where jobs are available. The level of unemployment in an area is therefore directly relevant and the lump sums or annuities must be fixed according to the difficulty of obtaining alternative employment.

In the context of what is a realistic level of annuities and grants, it is worth remembering that those people who are being paid off from the Ulster Transport Authority, now that it is being denationalised and the staff being cut to a more reasonable size, are receiving compensation payments of between £1,000 and £1,500. They are people in the age group 50 to 65 and they are often the brothers and cousins of the farmers whom we are here proposing to compensate. I cannot believe that stationmasters and firemen and signalmen who are made redundant are entitled to receive very much more than the small farmers who are made redundant by the policies of the Government of the day.

The Minister will have to tie these grants to a reasonable level. I shall look at tomorrow's HANSARD with considerable interest, because it might contain a classic. At one point the Parliamentary Secretary said that any resemblance between what appeared in the White Paper and what was actually done was entirely coincidental, or words almost to that effect.

Mr. Hoy

indicated dissent.

Mr. Clark

They were words very similar to that. However, the Amendment has given us the opportunity to press home on the Government the need for giving realistic amounts and, equally, for keeping those amounts adjusted to the steadily rising cost of living, and in view of what has been said, I beg to ask leave to withdraw the Amendment.

Amendment, by leave, withdrawn.