HC Deb 07 May 1968 vol 764 cc356-72

10.37 p.m.

The Joint Parliamentary Secretary to the Ministry of Agriculture, Fisheries and Food (Mr. John Mackie)

I beg to move, That the Fertilisers (United Kingdom) (Extension of Delivery Period) Scheme 1968, a draft of which was laid before this House on 25th April, be approved. This Scheme continues for a further year the fertiliser subsidy which the House has approved regularly since 1952. The amount of subsidy continues to be based upon the phosphoric acid and/or nitrogen content of the fertilisers. The amount which we expect to spend on this subsidy during the coming fertiliser year will be about £32½ million. This scale of contribution meets about 23 per cent. of the gross cost of those fertilisers on which subsidy is paid and offers a very big inducement to farmers to maintain and improve the productivity of their soil.

I hope that the hon. Member for Edinburgh, West (Mr. Stodart) is listening, because farmers with special difficulties—in hill areas and the Scottish islands—can have this scale of contribution supplemented under other Schemes.

The years over which this subsidy has been available have been marked by a substantial growth in the use of fertilisers. Our estimates for the fertiliser year just ending show that farmers used almost twice the 830,000 tons of plant nutrients used in the first year of the Scheme.

There has been progress in other ways. Farmers now use new types of fertilisers and the trend towards the higher use of nitrogen continues. Over three-quarters of all plant nutrients in subsidised fertilisers are applied in the form of compounds. The concentration of nutrients in such fertilisers has gone up from under 27 per cent. 15 years ago to 42 per cent. today.

This is an important technological achievement because of the great saving it represents in the bulk which it is necessary to handle. The great majority of farmers realise the benefit which comes from the use of the right kind of fertilisers on their crops. It is encouraging to see from the Survey on Fertiliser Practice in 1966 that on temporary grass the average application of nitrogen and phosphoric acid is approaching that for tillage. This is a tremendous advance when not so many years ago very few farmers put any fertiliser on their grass. But there is still room for greater application, especially on permanent grass, if farmers are to make the best use of it, and we are encouraging this by propaganda and advisory effort.

We have plenty of grounds for thinking—I know that there will be some pessimists among hon. Members opposite—that there will be no slackening in the demand for fertilisers, particularly of the nitrogenous varieties, and we are also confident that the fertiliser industry should have no difficulty in meeting demand.

I am sure that the House will agree that a high rate of fertiliser use is essential to productivity in farming, and I therefore ask the House to approve the Scheme.

10.41 p.m.

Mr. Michael Jopling (Westmorland)

We are grateful to the hon. Gentleman for explaining the purpose of this Scheme, but I find it hard to welcome it, even though it makes no change from last year's position, in view of what has happened during the last year. However, before dealing with the events of the last year, I should like to ask two specific questions.

The hon. Gentleman will well remember my Questions about fertilisers. Under this Scheme, we are to pay out large sums of public money according to the analyses of individual fertilisers. A large margin of error is allowed by Statute in tolerances of the agreed analyses of these fertilisers. In general, these tolerances are 10 per cent. either way of the agreed analysis, with a maximum of 1.75 per cent. for any one nutrient.

This is much too wide. I have made the case before, and I will not weary the House with it again tonight, but it is an outdated way of allowing tolerances, and the time has come to bring them more into line with the law in other countries. I understand that a committee is now reviewing the situation and because of that I have been fobbed off since I first raised this matter. I hope that we are now getting near the conclusion of this committee's work and that these tolerances will be tightened up.

The second matter is rather similar and the same committee is considering it. When public money is paid out for subsidies for nitrogenous fertilisers, it is essential that the source of the nitrogen should be stated. Some compounders, or fertiliser mixers, tend to use large amounts of urea as a source of nitrogen. This should be stated, for a case can be made for saying that urea is a less effective form of nitrogenous fertiliser than other forms.

These are two potential wastes of public funds, and I hope that we shall soon have legislation which will tighten up these loopholes, although I do not suggest for a second that our fertiliser manufacturers are in any way dishonest.

The Parliamentary Secretary spoke of fertiliser use and the effect of the fertiliser subsidy on the general management and productivity of our farms in general. We are all grateful for the assistance we get and which is shown by the excellent booklet "Fertiliser Statistics", put out each year by the Fertiliser Manufacturers Association.

Looking at this one comes to two conclusions. First, our arable crops generally are fairly well treated with fertiliser. Looking at the average use of nutrients on our farms for individual crops one feels that the average use of fertilisers on cereals is adequate. With cereal crops one is inclined to think that 51 units of nitrogen to the acre is a little low. When one considers that a great number of our cereal crops follow crops like sugar beet, which have sheep on them, this is a hidden introduction of nitrogen, which should be borne in mind.

It is on the grassland that there is the greatest scope for expansion. The figures emerging from this booklet show that there is still a serious situation. At present, only 75 per cent. of temporary grassland and only 46 per cent. of permanent grassland ever sees any nitrogenous fertiliser. The average nitrogen application is only 53 units per acre of nitrogen on temporary grassland and 25 per cent. on permanent grassland.

Anyone who knows about the possibilities of grassland management knows that these are rather low figures. The Minister said that everything was being done to encourage greater use of fertilisers on grassland through the advisory service, and so on. I hope that this will go on, with renewed pressure and vigour. It is through our grassland that we can probably make the greatest contribution to our balance of payments problem.

I began by saying that I found it difficult to welcome this Scheme, because of the very large increase in fertiliser prices over the last year. We have had three events which have bedevilled farmers in purchases of fertilisers, and I am disappointed that the Minister did not stress them more. First we had the Prices and Incomes Board report last year, which allowed a 6 per cent. rise in prices, mainly due to increased costs of raw materials. particularly sulphur. Secondly, we had the Suez situation, which again caused fertiliser prices to increase and finally, in November, we had the devaluation of the £, which again increased prices.

The effect of these events was acknowledged by the Government in the annual Price Review White Paper, in paragraph 51, where we were told: The effect of increases in fertiliser prices in 1967–68 is to increase the farmers' costs by nearly £15 million in a full year. This is what the Government have done. They have put up fertiliser prices to the farmer by £15 million. At the same time, this Scheme gives no extra help to the agricultural industry by way of subsidies, so that the whole of this extra cost has to be borne by the farmer. In the Price Review the guaranteed price of potatoes was put up by 7s. 6d. a ton and that of sugar beet by 3s. 6d. a ton. It must be quite clear and indisputable, that these increased prices will be totally swallowed up by increased costs of fertilisers.

What will be the effect on fertiliser usage in the next year? The Minister made great play of the fact that the fertiliser usage has gone up in the last year. When we look at the table in the Appendix of the Price Review, and at the estimated cost of Exchequer support to agriculture, page 38, one sees that from a forecast figure for fertiliser subsidy in 1967–68 of £32.4 million, it is estimated that next year the figure will be £32 million.

Therefore, the conclusion is obvious: that the Government are actively condoning smaller usage of fertilisers in the current year. I ask the Minister to tell us whether this is the Government's policy, because it seems clear from the figures in the White Paper that fertiliser usage will drop this year.

What does this mean in terms of the National Plan—that much vaunted document which came out some years ago—about which we do not hear so much now? The National Plan, in paragraph 22 on page 140, tells us: The Government are broadly in agreement with the additional requirements of fertilisers and feedingstuffs which the industry has estimated would be needed to promote the expansion of production that would be technically possible. Therefore, on the one hand, one has the National Plan saying that the Government accept that more fertilisers must be used. Yet, on the other, this year in this Scheme we have the Government actively condoning smaller usage of fertilisers than in the past. I want to know whether this means that the National Plan has now been finally thrown overboard in regard to the agricultural sector. If the National Plan has not been thrown overboard, why have the Government departed so drastically from it and why are they not bringing before us tonight a Scheme which does not just continue last year's Fertiliser Scheme, but allows greater subsidies so that fertiliser usage can be made to increase again?

Again, I ask: how does this situation fit in with the Prime Minister's devaluation broadcast in which he said that special incentives will be provided for increased home production from our farms in future? How are we to get this increased import saving from our farms if the Government are trying to reduce the usage of fertilisers on our farms? It occurs to me that this situation is another example of the Government's failure to manage the affairs of our nation, and the affairs of the agricultural industry in particular.

As I have said, I find it very difficult to welcome this Scheme. I shall be most interested to hear what the Minister has to say in reply. In the light of that we shall then have to decide how we shall react.

10.53 p.m.

Mr. James Davidson (Aberdeen, West)

I do not wish to make a speech, but I want to ask one question. Could the Minister inform us, when he replies to this short debate, what is the difference between the total tariffs and import duties charged on the constituent chemicals in agricultural fertilisers—nitrogen, phosphates, and so on—and the total amount that the Government have budgeted for under the Fertilisers Scheme for the coming year? I suspect that there is more import duty charged than is being handed back to the farmer in the form of fertiliser subsidy. I should like confirmation on that point.

10.54 p.m.

Mr. Peter Mills (Torrington)

While we welcome this Scheme in the present agricultural situation, I look forward to the day when we shall no longer have these fertiliser subsidies, but the correct price for our produce. There is no hope of this ever coming into operation under the present Government, but I look for-ward to the day when there will be no more subsidies and we get the fair and full price for our produce.

Does the Minister believe that everything is being done to keep down the price of fertilisers? It is all very well giving these fertiliser subsidies year in, year out: but one wonders whether, without them, the price of fertilisers might come down.

The application of fertilisers is essential. The days of using muck have gone, and it is necessary to use an ever-increasing amount of fertilisers if we are to get the best out of the land. I was always taught that if someone put a penny into a chocolate machine he received chocolate. Farmers realise that if they want to increase their output they have to use fertilisers, and there is much that the Ministry can do to encourage their use.

Mr. James Davidson

Does not the hon. Gentleman use muck?

Mr. Mills

Yes, but muck is not the only thing that we ought to use. If we want increased output, we must use fertilisers.

If the Ministry and the Government mean business when they talk about dealing with the balance of payments problem, they must encourage the use of fertilisers to increase output from our farms. The intelligent use of fertilisers is essential. I do not believe that the maximum increase in output will be achieved unless we increase confidence and profitability in the industry. It is only when that state of affairs exists that farmers will start to take advantage of these subsidies. It is only by making greater use of fertilisers that farmers can help to solve the problem of imports. I hope that the Minister realises that.

I welcome the Scheme, but I look forward to the time when there are no subsidies and farmers get a fair price for their produce which will make farming profitable. That could come about if the Government were prepared to change their whole outlook.

10.58 p.m.

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

I congratulate my hon. Friend the Member for Westmorland (Mr. Jopling) on the way in which he spoke from the Front Bench. I congratulate him, too, for doing what we have become accustomed to expect him to do on occasions such as this.

I appreciate what the Minister said. He was dealing with the use of fertilisers in the past. I congratulate the agriculture industry—and the Government for the help which they have given—on the technological improvements which it has made over the years. My hon. Friend was particularly constructive when he was considering how the Scheme would affect efficiency and technological advance, and I think that that is how we should consider it.

The statistics published by the Fertiliser Manufacturers Association Ltd. are particularly valuable. Some of the most interesting tables in the Association's Report are those which relate to the fertiliser practice surveys which have been conducted by the N.A.A.S. in England and Wales. Have similar surveys been carried out in Scotland? If they have been, what information did they produce?

One of the most interesting features of the Report is the tremendously wide regional variation in the use of fertilisers in England. Does the same hold good for Scotland? On page 22 the Report draws attention to the low rate of usage of nitrogen and potash in Wales in relation to phosphate, and the higher proportion of nitrogen in relation to phosphate and potash in the eastern part of the country as opposed to the west and north on both cereals and grassland.

This raises the question whether we ought to put some variation into this Scheme to take account of these different usages.

Mr. Peter Mills

Surely my hon Friend would realise that probably the answer to this is that in certain areas of this country farming is more profitable, and that farmers are able to use more fertiliser and take advantage of it?

Mr. Buchanan-Smith

Of course I appreciate this point, but I was interested to know whether the Under-Secretary did. This is a serious point, because we want these fertilisers used much more widely, and I should like to hear what comment the hon. Gentleman has on it.

I should like to turn to what is, I think, the most important point in this debate. That is to ask what thought the Government have given towards increasing fertiliser usage in the future, and particularly towards stepping up home food production?

As the Under-Secretary said at the beginning of the debate, there is a tremendous potential for increasing fertiliser usage. This is particularly true on grassland in relation to livestock production. I know, coming from Scotland, that it is in livestock production that this country has its greatest potential for saving food imports from overseas.

We always have dairymen held up to us as an example of one section of the industry where the use of fertiliser has been carried further than anywhere else, but is it being carried far enough and should not still more encouragement be given? Hon. Members in the Select Committee on Agriculture have been greatly helped by information given to us in papers by I.C.I. and Fisons on the use of fertilisers.

Where one takes dairy farms recorded by I.C.I. and the rate of nitrogen applied per acre, and looks at the best 10 farms in the survey, one finds a rate of appli- cation of 214 units per acre with a gross margin of £108 for each cow with an income per acre of £48.3. When one compares that on the best 10 farms with the national average of 45 units per acre as against 214, a gross margin of £73 as compared with £108, and income per acre of just over £15 as against £48.3, one realises what a tremendous potential there is for increasing fertiliser usage in our farms.

Dairying fertiliser can be carried further, but the greatest potential is in beef production. The Ministry of Agriculture provided us in the Committee with an interesting paper on the greater use of production of beef from grass. It showed that on experimental husbandry farms run by the industry, the increase one got for every £ spent on nitrogen was £2 in cash from the increased weight of the cattle. This again shows, as the Ministry itself has demonstrated, that there is a tremendous potential so far as beef production is concerned by improving our usage of fertiliser on grassland.

If this work that I.C.I. has been doing, and that the Ministry itself has done on experimental farms, is to be applied on a much more national scale than it is at the moment, is the Ministry really prepared to give the advice and the financial incentives, through Schemes like this, which will lead to as big an increase in production as possible?

In the paper by Fisons it is estimated that by 1972–73, that is over the next five years, agriculture could save something like £200 million in imports of food from overseas. This is a very similar figure to that mentioned in the National Plan, and I hope we shall have a reply to questions asked by the hon. Member for Westmorland about the National Plan. There the figure was also £200 million, although over a slightly different period.

Fisons estimated that if we were to get this saving of £200 in livestock products imported from overseas it would mean additional imports of raw material and fertiliser of something like £8 million a year. This means an average rate of increase of fertiliser of about 7.3 per cent. compared with the average rate over the last 10 years of 5.1 per cent.

Therefore, if we are to see the increase in production that there was under the National Plan, if we are going to see the expansion of agriculture which we all want, what is the Government's own estimate of the increased use of fertiliser that is necessary? Do they feel that this Scheme that they are asking us to approve is adequate to obtain this increased use of fertiliser which is believed necessary if we are to see an increase in food production? Do the Ministry have this kind of aim in view? If they do not, what is their aim? If they do have the same aim, do they agree that these figures put forward by firms like Fisons are sensible and reasonable targets which are worth aiming at?

If these targets are right—I think they are—then, as my hon. Friend the Member for Westmorland said, the rates of subsidy that the Minister is asking us to approve are not necessarily adequate to achieve this increase in food production at home. I hope the Joint Parliamentary Secretary will clarify the Government's thinking on future fertiliser usage.

11.7 p.m.

Mr. J. E. B. Hill (Norfolk, South)

My hon. Friends have stressed that each piece of evidence and every estimate given to the Select Committee on the prospects of British agricultural expansion into the 1970s turns on the increased use of fertiliser.

Broadly speaking, perhaps, 1½ million acres which are currently in grass might go into wheat and barley, but it is clear beyond any doubt that if that acreage is subtracted from the present acreage of grass, the output from the remaining acreage of grass must be substantially increased to feed the expanding numbers of livestock. Similarly, one will not get the yield of wheat and barley on land taken from grassland for cereals unless fertiliser is used.

Yet we have this curious disparity in use. It seems from looking at the figures that it is the arable districts that use the fertiliser and the grassland districts that lag behind. Even the temporary grass figures show that in arable districts grassland is being given twice the fertiliser that is given in the purely grassland areas. I wonder why this is so, bearing in mind that the most ominous part of this year's Price Review is the expected increase in fertiliser costs. They are very substantial. It is estimated that it will be £14 million for all products and £11 million for Review products. In the previous years 1954–67 the pluses and the minuses in rises and falls in fertiliser prices cancelled out.

This year the industry is facing this very large increase which one can only suppose will discourage the marginal usage of fertiliser. I am therefore asking the Joint Parliamentary Secretary what he proposes to do to encourage greater use. Are the N.A.A.S. officers pushing it sufficiently high? What are the reasons for this curious failure to add the missing link into what should be profitable expansion?

11.10 p.m.

Mr. Anthony Stodart (Edinburgh, West)

I always think that these are among the most important of the agricultural Orders, because the development of fertilisers has been one of the great contributors to the agricultural revolution of the past 15 years. It is a long time since there was only one concentrated fertiliser on the market, the wellknown 12.12.15, which was called the I.C.I. No. 1, although there were, in fact, no others.

Fertiliser concentrates are getting stronger and stronger. Nitrogen is even stronger with the development of nitram as opposed to nitro-chalk than it was two or three years ago, which means that there can be far more waste if it is not properly used. Whereas hundredweights an acre mattered four or five years ago, now pounds an acre can leave a considerable impression on a field if the highly concentrated fertiliser is misused.

Therefore, what advice is given by N.A.A.S. officers? Are they bending themselves to the important task of advising people on the importance of a good distributor for the fertiliser and of using the best balanced fertiliser for their particular land? To apply one in the ratio of 1½.1.1 when 1.1.1 should have been used can cost the public purse a great deal of money.

A very important point brought out by my hon. Friend the Member for Westmorland (Mr. Jopling) is the reduction in the estimate for the year which lies ahead as compared with 1967–68. There is no reduction in the percentage rate of subsidy, so the only possible conclusion is that the Government anticipate a reduction in the tonnage. That would be disastrous, because we are far from achieving, nationally, the optimum rates of fertiliser usage, and few farms have reached the optimum.

We are beginning to talk—but little more—of 100 units of nitrogen for wheat and 80, say, for barley, but I suspect that the average application for barley is much nearer 50 or 60. If that is to be reduced, either the advisory services are not doing their job, or farmers cannot take advantage of the advice because of the shortage of ready cash. I regret to say that I believe that on much land, apart from the highly farmed arable areas, one of the things on which farmers still tend to economise is fertilisers. This could knock into fragments what remains of the Government's National Plan. Very little of it survives today. If the Government expect a reduction in the use of fertilisers in the coming year, then they are themselves ringing the death knell on that lamentable project which they put forward a few years ago.

11.15 p.m.

Mr. John Mackie

When I spoke earlier I suggested that there were some pessimists on the benches opposite. I did not realise that they were all pessimists. The hon. Member for North Angus and Mearns (Mr. Buchanan-Smith) said he welcomed what he described as "the constructive speech" of his hon. Friend the Member for Westmorland (Mr. Jopling), which I regarded as a most destructive speech. Indeed, it must have been one of the most stupid speeches the hon. Gentleman had ever made.

Mr. Jopling rose——

Mr. Mackie

No. I have only just begun. If the hon. Gentleman really thinks that farming is depressed he must be going about with his eyes closed. I have recently been touring farming areas, right up to the north of Scotland. Tomorrow I will be going to Pembroke-shire. I have never seen the industry doing more. This is confirmed by the number of applications we are receiving for new buildings and capital. The same can be said of the amount of fertiliser being used.

Mr. Jopling rose——

Mr. Mackie

No. The hon. Gentleman made his speech and before giving way to him I intend to make the position clear. He does not appreciate what is going on.

Mr. Jopling rose——

Mr. Mackie

I did not interrupt the hon. Gentleman when he was speaking. I will give way to him later, but first I want him to appreciate what is really going on. A great deal of capital is going into agriculture. Farmers have increased confidence. That is proved by the great increase in capital going into the industry. They would not have this confidence if we had not taken a number of important measures in recent years.

Hon. Gentlemen opposite have used the fertiliser subsidy, which is only one part of our agricultural policy, to make debating points. This subsidy must be taken in conjunction with all the other things we have done and are doing. I will not list them—I would be out of order if I did—but much has been done by the Government in the last four years, with the result that farmers now have confidence; and the hon. Member for Westmorland has failed to realise this.

Mr. Jopling

When the hon. Gentleman reads the report of my remarks in tomorrow's HANSARD he will see that I did not say that the agricultural industry was depressed. Indeed, I think I said that the fertiliser usage on arable crops was running at a satisfactory level, although I mentioned that more could be done in this connection on grassland. I hope that the hon. Gentleman will not try to ride over the fact that his Department's figures suggest that in the coming year it is envisaged that the rate of fertiliser usage will fall. I find this lamentable. I trust that he will not persist in saying that I said that the industry is depressed, because I did not say anything of the sort.

Mr. Mackie

When he reads the report of his speech, which I am sure was accurately recorded, the hon. Gentleman will see that he implied what I have said.

Mr. Jopling

indicated dissent.

Mr. Mackie

I am sorry if I am treading on the hon. Gentleman's toes. I appreciate that it must hurt.

If hon. Gentlemen opposite will consider all the factors involved, the whole policy, they will see what is happening. Instead, they have concentrated on fertilizers and have created a mini-debate based on the fertiliser subsidy. I pointed out that this subsidy for the coming year would be about £32½1 million. In the Price Review it was put at £32 million, but that is because figures are rounded off in giving estimates, which is the normal method. The figure is about the same as last year, when it was £32.4 million. There has, therefore, not been a decrease in our estimate. Indeed, there is a slight increase and it is part of the encouragement we are giving to agriculture. It shows that there is likely to be an increased use of fertilisers, as there has been in the past.

As on previous occasions, the hon. Member for Westmorland raised the question of the analysis and the margin of error allowed. I accept that this margin exists, but the farmers are getting the best of the bargain. A committee is looking into the matter and I regret that it is taking so long. Having looked into it, I assure the House that the analysis shows that farmers generally come out of it well and get the best of the bargain.

On the question on the sources of nitrogen, I must disagree with the hon. Gentleman. Analysis of urea shows that in many cases it is just as good as other sources of nitrogen, and it is not necessary to mention it separately.

The hon. Gentleman mentioned, as did many other hon. Members, what is theoretically the amount of fertiliser that one can put on to grassland to get the maximum production. I recently sat beside Dr. Woodford of the Grassland Research Station, and Dr. Smith. They took out their pencils, and on the back of the menu they showed me what could be done theoretically with an acre of grassland if one had an acre of grassland, with the right kind of water, the right kind of fertiliser and the right kind of management. I could not disagree on what could be done. But we must realise that all farmers are not like Stanley Morris of Westmorland, and other people I could mention. We have to take average farmers sitting down and working it out theoretically, and basing arguments on that will not take us very far.

Hon. Members have pressed the point of fertiliser usage going down. The hon. Member for Edinburgh, West (Mr. Stodart), in his usual exaggerated language, said that the National Plan would be in ribbons. We had an increase of about eight points in production this year. This will go up next year, and the hon. Gentleman will find his ribbons are tightly tied up by the time I stand at the Box to put forward next year's Scheme.

The hon. Member for Aberdeenshire, West (Mr. James Davidson) brought up the Liberal point about the amount of the tariffs. I would need a long time to give him all the answers. From Commonwealth and E.F.T.A. countries fertilisers come in duty-free. There are considerable tariffs on imports from other countries, but there is no duty on imports of Chilean nitrate, phosphate rock, or on potash. I have not the totals, but I am prepared to send figures to the hon. Member, and he can tie them up and put down a Question in due course.

The hon. Member for Torrington (Mr. Peter Mills) would like subsidies to be scrapped and the introduction of a levy system. I do not think that is within the scope of this debate. I see him nodding his head.

Mr. Peter Mills

It is very important.

Mr. Mackie

The hon. Gentleman also raised the question of how much more could be done. The N.A.A.S. is going ahead, and we are giving advice all over the country. It is up to the farmers to take it.

I forget which hon. Member raised the point that it was only farmers who made a profit who used fertilizers. It is cause and effect. If farmers do not use fertilisers they do not make a profit. It is not the making of a profit that causes farmers to use fertilisers, but the other way round.

On the point of the fertiliser survey, this is done with the aid of the N.A.A.S., and I am afraid that in Scotland there is not the same co-ordination. There are three advisory services and there is no co-ordinated survey. This is something which I might put to my right hon. Friend the Secretary of State for Scotland in order to get a similar survey to the one done by N.A.A.S. in England. On some occasions I have defended the Scottish system; on other occasions I have defended the English system. There are good points in both. This is a good system for English farmers and a bad one for Scottish farmers.

The hon. Member has also mentioned the wide variation in the regions. He knows as well as I do that in areas where there have been heavy applications of fertilisers in the past, particularly in arable areas, reserves have been built up, and sometimes there may be an easing off. In other areas a back-log has to be be made up. This applies to lime and phosphates rather than to nitrogen, but there are areas where it seems strange that more nitrogen is not used, particularly in the Pennines, where there is water to do the job. Again, this is a case of advice and education. The hon. Member went into considerable detail about what can be done and it was an interesting survey. Many of these estimates are theoretical. He mentioned Fisons; it is only fair to say that they have an interest in pointing out what can be done.

I emphasise that this fertiliser scheme is not the only thing the Government are doing for the industry. There is a mighty lot more which gives farming the confidence which I am sorry to know that hon. Members do not think it has. The hon. Member for Norfolk, South (Mr. J. E. B. Hill) also pointed out how much can be done on grassland and emphasised the great rise in fertiliser costs. I agree. The hon. Member for Westmorland spoke of the 6 per cent. rise in prices overseas compared with two or three years ago, a matter for which neither this Government nor any British Government had any control. Those costs are recouped in the Price Review.

Mr. Peter Mills

No.

Mr. Mackie

It is no good saying "No", all these rises in costs are taken into account and are recouped. Farmers were left with just over £14 million of their increase in efficiency by the Review. The efficiency figure was introduced by the previous Government and has always been used since.

Mr. Stodart

Does the hon. Gentleman claim that the efficiency factor has not been increased within the last few years much to the disapproval of the farming industry?

Mr. Mackie

It may be to the disapproval of the farmers, but it was in agreement with the National Farmers Union. The figure has increased from £25 million to £30 million and the Union agreed that that was perfectly right.

I have answered most of the points which have been raised. I am thoroughly convinced that farming will go on using fertilisers, that education and advice will improve and we shall get increased production. I agree that the main increase in production we can get is on permanent grassland. We are concentrating on this. I assure hon. Members that the National Plan will be carried out in spite of their pessimism.

Question put and agreed to.

Resolved, That the Fertilisers (United Kingdom) (Extension of Delivery Period) Scheme 1968, a draft of which was laid before this House on 25th April, be approved.