AGRICULTURE (CAPITAL GRANTS)

HC Deb 28 March 1972 vol 834 cc371-90

10.16 p.m.

The Parliamentary Secretary to the Ministry of Agriculture, Fisheries and Food (Mr. Anthony Stodart)

I beg to move, That the Farm Capital Grant (Variation) Scheme 1972 (S.I., 1972, No. 368), a copy of which was laid before this House on 16th March, be approved. With your permission, Mr. Speaker, I believe that it will be for the convenience of the House if the two orders varying the Farm Capital Grant Scheme are considered together. The other order is, That the Farm Capital Grant (Variation) (Scotland) Scheme 1972 (S.I., 1972, No. 362), a copy of which was laid before this House on 16th March, be approved. Their content is similar. One covers England, Wales and Northern Ireland; the other Scotland.

Mr. Speaker

With the leave of the House, so be it.

Mr. Stodart

I will, if I may, deal first with the amendment contained in paragraph (2) (a) of the variation scheme for England, Wales and Northern Ireland. Its purpose is simply to correct a minor printing error in paragraph 3(l)(a) of the principal 1970 scheme.

The main purpose of the variation schemes is to give effect to the changes in the capital grant arrangements which my right hon. Friend outlined to the House on 1st March in his statement on this year's Annual Review. They continue the higher rates for field drainage which, like the rates for other works and facilities, were to have been reduced by 10 percentage points for applications after 18th March, 10 days ago. They also bring to an end the grants for certain items unless application is made by 31st March.

The temporary two-year increase in the rates was introduced by the Labour Government in 1970 when credit was dear and scarce, and rising costs had left farmers with little margin for investment.

It will be generally conceded that the industry's situation today is entirely different. Incomes are higher, credit is cheaper and easier, taxation is less onerous, and there is greater confidence abroad. The temporary need for higher rates of grant across the board is, therefore, behind us.

However, field drainage calls for special priority, and for that reason the schemes exempt this work from the general reduction in rates. Field drainage is of fundamental importance for raising production and productivity. A recent survey by my Department has shown that there are still about 7 million acres of land in England and Wales alone which could benefit from being drained.

The annual acreage drained in England and Wales as a result of grant-aided schemes has doubled in the past 10 years, and in the past year reached over 215,000 acres, while the cost of all types of drainage schemes completed in the present financial year is expected to be about £14½ million, a 26 per cent. increase over the comparable figure for 1970–71. If the higher rates of grant are not continued there is a risk that this desirable impetus would be lost.

It would also become far more difficult to encourage the awakening interest in drainage in the traditional grassland areas, where more drainage is needed, both to facilitate an extension of arable crops and to enable the grass itself to be fully exploited. So paragraph 2(d) of the variation scheme for England and Wales and Northern Ireland amends Schedule 3 of the principal scheme so as to continue the present rates of 60 per cent. for field drainage work generally and 70 per cent. if the work benefits hill land. The variation scheme for Scotland makes the same adjustment.

The annual cost of continuing the higher rates on field drainage in the United Kingdom is estimated to be about £2 million. We have also reviewed the other items in the scheme, to see whether they reflect the right priorities for the use of public money in present-day conditions.

While with drainage we decided that a high priority was needed, there are a number of relatively minor items which no longer require or justify a Government grant on lowland farms. The scheme thus specifies seven items for which grant will be ended. They are, briefly, sheep and cattle grids; fencing; shelter belts; hedge removal, land clearance and reclamation, but excluding orchard grubbing; ploughing; destruction of cover for rabbits; and claying and marling.

Applications made after 31st March in respect of these items will not be eligible for grant. We provided a period of grace before ending the grants to allow farmers who already had plans in hand to get in their applications. I understand from reports from our local offices and the offices in Scotland that considerable advantage has been taken of this opportunity.

The annual savings from the ending of grant on these minor items will come to less than the £2 million extra which we shall be spending on going on with the higher drainage grant. We are, however, extending the list of works and facilities covered by the special hill item which is item 13 in Schedule 2 to the 1970 scheme. Hill farmers will thus be able to get a 50 per cent. grant on applications made after 31st March.

Although ploughing grants are not specifically mentioned as being continued for the hills, ploughing work of a capital nature—this brings us back to the old £12 an acre grant—will continue to qualify in the hills as "regeneration of grassland" or "reclamation of land" which are already mentioned in the hill item.

These measures keep the Farm Capital Grant Scheme in line with the changing needs and circumstances of the industry. Coupled with this year's Annual Review award, they will enable the industry to press on with the capital investment needed to take advantage of the opportunities offered by entry into the E.E.C. I therefore ask the House to give approval to these two Statutory Instruments.

10.25 p.m.

Mr. Eric Deakins (Walthamstow, West)

I am sure that both orders will be welcomed by my hon. Friends. Several questions arise from what was implicit in the Minister's remarks, and I know that my hon. Friend the Member for Renfrew, West (Mr. Buchan) will have some questions to ask, particularly about the Common Market aspects of this issue.

There is an aspect of these instruments, which vary the 1970 and 1971 measures, to which public attention should be drawn but to which it has not been drawn either by what the Minister said or by the explanatory note to the orders. I am referring not to field drainage, because hon. Members recognise the importance of continuing this form of grant at a high level. This must remain a high priority.

The Minister said that not all the emphasis in the Farm Capital Grant Scheme should be on increasing productivity and that there would no longer be a high priority for certain items in the scheme on lowland farms. He mentioned some of these items, but, from the public rather than from the farming point of view, we should comment in more detail on some of the items in Schedule 2 to the 1970 order, for we are anxious to know the implications of any change in Government policy in regard to this scheme and in their attitude towards increasing agricultural productivity generally.

I refer to the items in Schedule 2 numbered 10, 11 and 12. Item No. 10 deals with the provision, replacementor improvement of permanent fences, hedges, walls or gates. Item No. 11 deals with similar matters, while item No. 12 talks, among other things, about the removal of hedges. Work under these items was encouraged by the 1970 order, and generous grants were paid to farmers for undertaking these activities; namely, the pulling up of hedges and the filling in of ditches in the service of increased productivity on British farms.

Although the Minister was a little coy in what he said, the House should recognise that there seems to be a change of policy now in that the ending of grants for lowland farms for the purposes to which I have referred might appear to be the first concession to be made by any Government in Britain to the conservation lobby in this country.

The Minister will be doing a disservice if he does not publicise this factor inside and outside the House and in the Explanatory Note to these instruments because with the growing movement in Britain to query whether or not the measures which we have been forced to adopt since the war to increase agricultural productivity at all cost—the record of this increase is second to none; it is a pity that it is not more widely appreciated—there comes a point when the emphasis towards increasing productivity may be outweighed by the disadvantages from either the pollution or the conservation point of view.

When it comes to grubbing up or removing hedges, filling in ditches, and so on, it may be that the conservationists' demands are put in a small way first, but then they become more vociferous, as may happen within a year or so, and carry greater weight when the Government take decisions of this sort.

This development will be widely welcomed, and not only by the conservationist lobby. However, a great deal more needs to be done in considering whether many of the intensive methods which British agriculture is being forced to use are necessarily warranted or whether the advantages of these methods are not outweighed from the conservation or pollution point of view.

It has been known for several years—there have been many articles about this in scientific magazines and magazines of general interest—that the pulling up of hedges and in-filling of ditches can lead to changes in the ecological balance. It would be nice to think that here—and I hope the Minister will recognise this—we are for the first time, as far as I know, in any order connected with agriculture, making a concession to the point of view advanced for several years past in the Press, in magazines and elsewhere on behalf of the conservationists who believe that there are limits beyond which we cannot go in the increasing pressure for intensive farming.

It is, perhaps, a pity that we still have to continue with grants for the purposes I have mentioned for hill farms. However, it may well be that there will not be so much demand by hill farmers for grants for these purposes, because the basic damage—if damage has been done at all—has been done in the countryside generally, in the lowlands.

It is a pity that the Government have been a little coy in their Explanatory Note. I cannot believe that the reason is that there are so few hedges and ditches. As anyone who is familiar with the countryside will know, many are still left, although many miles of them have been ploughed up and removed in the interests of higher productivity in recent years. It is nice to know that if farmers continue doing this they will no longer be able to qualify under the capital grant scheme.

Finally, it is perhaps a little unwise to remove farm capital grants for waste land reclamation. Surely with the loss of some very good agricultural land to reservoirs, the needs of industry, urban development, and so on—I do not know the rate, but it is increasing and worries all those interested in the wellbeing of British agriculture—we have to do all we can to cut the rate of loss of land. One way of doing that is to maintain such grants as exist for the reclamation of waste land which can serve no other useful purpose.

Although the Minister may not wish to look at this matter again now, the reclamation of waste land is not on a par with some of the other things on which farm capital grants are being removed. I hope that the next time we have a similar order we can restore grants for this purpose.

10.32 p.m.

Mr. Peter Mills (Torrington)

I welcome the schemes and congratulate my right hon. Friend the Minister on the present situation of agriculture.

The number of applications for farm grants shows the very real confidence which at present exists in agriculture. One has only to cast one's mind back a few years to see the change that has come over agriculture. Farmers do not spend money unless they have confidence and know that they can increase their production and sell it.

I understand that the number of applications for farm improvements and for these grants over the last month is greater than the number of applications in a normal year, and that the number of drainage applications for the last month in some sections is greater than for three years. This is a fantastic situation. One reason is that there will be a slight cut in the grant; but for all that, it still shows the confidence and increased production we shall get in the years ahead. The Opposition benches might well remember the past and see the effect of restoring confidence to agriculture.

With regard to drainage and the grants, my right hon. Friend is very wise in keeping grants up to 60 per cent. because, if we are to obtain the increased production necessary when we enter the Community—and, by Jove, we shall have to increase production—we need to bring into production some of the land which is not working at 100 per cent. One cannot produce a golden purse out of a sow's ear. In the South West there is very poor land which it would be ridiculous to drain. There is, however, a large acreage of land that can be improved.

I ask my hon. Friend the Parliamentary Secretary to be selective in approving these drainage schemes. It is useless draining the land, spending 60 per cent. Government money and the rest from the farmer, when it will never produce anything. If attention is turned to the land which can be improved, we can achieve the increased production we need when we join the Common Market.

10.36 p.m.

Mr. Christopher Brocklebank-Fowler (King's Lynn)

I want to refer to the remarks of my hon. Friend the Parliamentary Secretary concerning his decision to remove claying and marling from eligibility for capital grants. When he replies will he explain why the Government have decided to make this withdrawal from eligibility, particularly in view of the Strutt Report and its recommendation that this practice should be encouraged, especially on the lighter fen soils in order to combat erosion of the soil by wind?

10.37 p.m.

Mr. James Scott-Hopkins (Derbyshire, West)

I welcome the scheme and I am glad that my hon. Friend the Member for Torrington (Mr. Peter Mills) raised the question concerning land drainage grants. It could almost be thought from some of the euphoria about the continuation of these grants that they have only just been brought in, but they have been in operation for years. I cannot help wondering what land of any value is left which has still to be drained.

One of the things that worried me eight or 10 years ago and still worries me is to find the land which will qualify for these 60 per cent. grants. As my hon. Friend said, one cannot make a golden purse out of a sow's ear. In my part of the world as in his there is land which will qualify for the grant but which in all honesty should not. I am sure my right hon. and hon. Friends are aware of this. I am sure that this same fact applies in Scotland, where there is a vast amount of land which should not be brought back into agricultural production by land drainage grants. I would strike a note of caution because my hon. Friend has mentioned that the sum of £2 million will be spent on this.

Another point which worries me is that land which has received a grant for drainage often reverts almost to its former poor condition. It is certainly not maintained in the condition it was in immediately after the grant was paid. My hon. Friend's officials might look at the schemes to make sure that land is maintained after drainage takes place.

I welcome paragraph 2 (b) of the scheme. My only quarrel concerns the marginal land which lies between the hill land and the lowland land. In my part of the world, in Derbyshire, we come across a certain amount of this, as in my previous constituency in Cornwall. There is land that is not hill land and is not good in bye land, as it is called, but is in between the two. I hope my hon. Friends will look carefully and sympathetically at this type of land. It has been called waste land. It is a little better than that, but is still not good in bye land. Farmers on this marginal land will be deprived of the grants, which are important for people farming that kind of land, from 31st March.

I hope that the conservation lobby has not been the cause of my right hon. Friend's making the scheme, as the hon. Member for Walthamstow, West (Mr. Deakins) suggested. I am certain that it has not. I am certain that it is good sound farming practice that has made my right hon. Friend introduce it, reduce the amount as he has for the low land and keep the grant for the hill lands.

I welcome the scheme in general, particularly in view of our imminent entry to the Common Market, as I believe it will help us improve our agriculture. We are seeing a resurgence of British agriculture under the present Government, and I wish them God speed in what they are doing.

10.41 p.m.

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

I seem to be the first Member who has to declare an interest in this matter. I have made considerable use of the grants and I am grateful to the Ministry for keeping them on so long.

It is a surprise to me that no fewer than 7 million acres should still apparently need draining. If that is so, at the present rate it is considerably more than a 20-year job. That in itself seems to me to justify keeping the drainage grant at a very high level.

I agree with my hon. Friend the Member for Derbyshire, West (Mr. Scott-Hopkins), who mentioned the desirability of possibly monitoring the subsequent history of the land that has been drained, because if drainage schemes are not maintained much of the capital benefit can be quickly lost.

One effect of the abolition of the capital grants in general, I suspect, is that farmers may have made rapid applications for schemes other than drainage because those grants were ending or being reduced, so that to some extent this distorts what should be the correct order of priorities, which is to do the drainage first, but that is probably inescapable when stopping one series of grants and maintaining another.

The allegation that farmers, by removing hedges, have destroyed a great deal of nature of amenity value has been somewhat overdone. Admittedly there are some glaring cases, but a farmer is often the best conservationist there is, because most farmers by now realise that the capital value of their farms is enhanced if they carry a high amenity interest.

Although it may be wise to stop the grant for the removal of hedges, because this will often pay for itself in a comparatively short time, I am rather sorry that the grant for shelter belts has stopped, because very often enlarging a field and wanting a rectangular shape results in an off-cut of land which might well be planted out with an eye to conservation and making a small nature reserve, although the farmer would probably be forgoing some crop income by giving up that off-cut from the rectangle. Some grant aid for deliberate conservation purposes might be desirable in the future.

I slightly question the desirability of removing the grant for getting rid of scrub that may be inhabited by rabbits, because with the weakening of support for rabbit clearance societies this pest may re-establish itself in the less conscientious districts.

I am sure it is desirable to back the hill subsidies as much as we can as long as we are clearly free so to do. My view is that these subsidies are wholly within the E.E.C. common agricultural policy as they are designed not to distort competition but to redress the disparity of nature in certain areas that are particularly difficult to farm. As to the information from the Community that there is likely to be a long-term shortage of stores and livestock raised on the hills in this country, I hope that we shall succeed in convincing the Commission that these grants are something which should not only be allowed here but encouraged in the Community itself.

10.45 p.m.

Mr. John Farr (Harborough)

My hon. Friend the Member for Derbyshire, West (Mr. Scott-Hopkins) wondered why these grants have continued for so long and yet apparently there are still large amounts of acreage to be drained. The answer is that if a man has a certain very limited amount of money to spend, he will choose to spend it rather on erecting a new building for which he can see an immediate return than on field drainage for which the return is less apparent. It is my hope that with the more prosperous days of agriculture which, thank goodness, now seem to be with us again and the greater confidence in the industry, some of the 7 million acres still remaining to be effectively drained will now be tackled under the continuous scheme of a 60 per cent. grant. My experience is that many of my constituents would seize the opportunity presented by the continuance of these grants and to the 60 per cent. they would add their share of 40 per cent. I hope that in the next two or three years, given the continuance of a Conservative Government, the money will be there and we shall make rapid strides in land drainage.

I welcome the continuation of the scheme and I welcome both Statutory Instruments. I echo the words of my hon. Friend the Member for Derbyshire, West and beg my right hon. Friend the Minister not to accept schemes for drainage of absolutely hopeless bogs. After the expense of 60 per cent. contributed by the taxpayer and years of work, at the best they can provide only low-grade class III land. It is far better to leave that land in a condition of bog and to spend money on first-class agricultural land which perhaps has an antiquated system of drainage.

I welcome the decision to abolish the scheme for giving grants to grub up hedges. It has always seemed an anomaly to pay a grant to grub up a hedge and a grant to build a fence in its place. People planting cereals may think it a good thing to do this and to make 60-acre or 70-acre fields. Before long they will learn the lesson which has been learned in the Midlands years ago that there is no shelter for stock behind a post and rail fence and a hedge, preferably a high one, has remarkable value in preserving and conserving stock. I welcome both these schemes.

10.50 p.m.

Mr. Charles Morrison (Devizes)

I give a general welcome to these schemes subject to one reservation to which I hope my hon. Friend the Parliamentary Secretary will refer in replying. I declare my interest in that like my hon. Friend the Member for Norfolk, South (Mr. John E. B. Hill) I have already claimed considerable benefit from the Capital Grant Scheme and intend to continue to do so. I will do so because of the confidence which my right hon. Friend the Minister of Agriculture has instilled into the industry since he took office. It is incredible what he has done since 1970. There is no doubt that the industry is facing the future in a frame of mind very different from that in which it found itself 20 months ago.

I come to my reservation. My right hon. Friend rightly intends to continue the high rate of grants for drainage. He does that basically because he wants to see better use made of grassland and greater emphasis given to livestock production Complementary to the need for good drainage as a means of providing better grassland there is need for better fencing. Over the years there is no doubt that in the corn-producing areas good fencing has disappeared. No doubt this is as true in East Anglia as it is in part of the corn belt, if one can call it that, in Wiltshire and Hampshire. If farmers are to increase their livestock production and if they are to turn to grassland production, they will need better fencing. What is the logic in removing the capital grant on fencing in the lowland areas?

10.53 p.m.

Mr. Norman Buchan (Renfrew, West)

I am sorry to break up this mutual admiration society and all this talk by the hon. Member for Torrington (Mr. Peter Mills) and others of a new-found confidence in the industry. I have my suspicions about this paean of praise. I look at these schemes against the background of the introduction of legislation and of the present farming situation, including entry to the Common Market.

I am rather surprised at this mutual admiration society because when we introduced legislation—which I vividly remember—amalgamating grants into one grand Capital Grant Scheme we did not find that in Committee we had an easy ride. The hon. Member for Torrington was involved in this as was the hon. Member for Weston-super-Mare (Mr. Wiggin), who is not with us tonight. I recall his saying: I can see that in the case of these capital grants for agriculture we may well wish to amend them in detail, or even in substance, but we shall not have the chance. I believe it to be a great pity that the Minister"— that was me— has not got the 'guts' to name the grants, to name his improvements and specify them in the Bill, and not find it necessary to put them before the House in the form of a Statutory Instrument. I hope that we shall reject the Clause out of hand. The argument was that by bringing all these grants into the form of a scheme in a Statutory Instrument no opportunity would be given to discuss various aspects of the grants in detail. The hon. Member hoped that the Minister would have the guts to introduce it in the form he desired.

We now have an opportunity for the Minister to have the guts to do that now. In Committee at present is the Agriculture (Miscellaneous Provisions) Bill, and the Parliamentary Secretary and the Ministers who are at present occupying the Treasury Front Bench are all members of that Committee. No doubt, had he been present, the hon. Member for Weston-super-Mare would have argued that it was essential that opportunity should be taken to bring in such matters in that form, but again it might have been argued that it was only a back bencher who was making such a suggestion.

Unfortunately, the Parliamentary Secretary who introduced the scheme tonight also said this in Committee: My real objection to the Clause is that it substitutes the Statutory Instrument for the Statute. There is far too much delegated legislation today. Far too many matters of great importance are enacted by Statutory Instruments, which we can discuss under the affirmative Resolution procedure but which we cannot under any circumstances amend."—[OFFICIAL REPORT, Standing Committee B; 16th December, 1969, cc. 371, 365.] Therefore, the Minister has had his opportunity tonight to show that he has guts, and he has failed us. We all know the admiration for agriculture which has been expressed so often by Conservative Members. We can now see how they change their view once they find themselves in government. We can see they have not quite as much admiration for agriculture as they have claimed in the past.

I should like to welcome the continuation of the drainage grants of 60 and 70 per cent. The hon. Member for Derbyshire, West (Mr. Scott-Hopkins) said he was surprised that, with all these grants, there was any land left to be drained. One reason is that Governments have tended to become obsessed by the 50 per cent. concept and, unless the farmer has been willing to put up half the capital, it was not considered to be worth, while giving the subsidy towards it. The 50 per cent. became the magic totem figure to allow the farmer to evaluate the worth-whileness of work to be undertaken.

The great advance by the Labour Government was that we broke the barrier of mythology and introduced a 60 per cent. grant, and even a 70 per cent. grant in the hill lands. It may be that the farmer does not have the capital to raise the necessary 50 per cent., even though he can see how worth while any such work may be. Therefore I welcome the 70 per cent. grant because the value of the work to be done bears no relationship to the availability of the capital involved by the farmer in the land. It is now recognised that, if we are to do something about the land, we cannot afford not to pump money into it.

I emphasise this aspect of the matter because I have seen the results of an investigation into some of the areas of land available in Scotland. Half of the total acreage of 250,000 acres in the County of Inverness is owned by 13 people. To take another example, some 700,000 acres elsewhere are owned by only five people. To take a third example, one landowner alone owns 161,000 acres—nearly three times as much as the area of land occupied by Glasgow, Edinburgh, Dundee and Aberdeen put together.

We know that proper use is not being made of that land. The Government in the last week in industry have trod the road to Damascus, so I hope that when they are prepared to pay out grants of this kind they are also prepared to ensure that proper use is made of land in hill and marginal areas which is in private possession on this scale and is used for the purposes only of sport.

Mr. Scott-Hopkins

The hon. Gentleman is being a little unfair to landowners in his native Scotland. Will he say to which land he is referring as being in the ownership of this small number of people, what height it is above sea level and what type of land it is? Is he saying that land which is very high up and overgrown with bracken and heather is suitable for drainage?

Mr. Buchan

What I am saying is that a certain acreage is capable of reclamation, and the sooner we get down to reclaiming it the better. I have walked over a good deal of it and I know the territory. I do not shoot deer, pheasants and partridges but I know Inverness-shire. I am saying this all in the context of welcoming what has been done. If hon. Gentlemen on the Government side behave like this to me when I am thanking them, I do not know how they will behave when I reject something.

The hon. Member for Torrington spoke of the number of grants taken up over the last few months compared to the number taken up over the previous years. As Dr. Johnson said, When a man knows he is to be hanged in a fortnight, it concentrates his mind wonderfully. The time when the Government are ending the grants is precisely the time when many applications are made.

My hon. Friend the Member for Walthamstow, West (Mr. Deakins) suggested that one reason for the schemes was the pressure of the conservation lobby. I see no reason why the hon. Member for Derbyshire, West should object to this. It is a pressure group to which we should listen. We must achieve the right balance between agricultural and industrial demands and the views of those who wish to preserve our environmental well-being. The over-encouragement of the stripping away of hedgerows in East Anglia, for example, while it may have led to greater profits in the short term for cereal growers, has not in the long run had a beneficial effect on the soil. This is one aspect of the conservation lobby. To discourage the misuse of our soil we need to subsidise good husbandry. If this is the reason I welcome it.

There could be another reason which was referred to by the Minister. He said that it was against a background of entry into the Common Market. How many grants does he feel are perhaps suspect or in difficulty because of our entry into the Common Market? Have the grants been removed from the lowlands and left for hill lands and marginal lands so that they can be left as direct grants for regional purposes? We should like to know what the reason is.

I am glad that the grants for hill land are to be continued. In some ways I, too, deplore the disappearance of the provisions for bracken control and reclamation of waste land in the lowlands. I see no reason why that should not have been kept. Even in the lowlands we should be giving concentrated attention to reclamation.

I give a general welcome to the purposes of the scheme and we shall not vote against it since we are, as usual, co-operative.

11.5 p.m.

The Under-Secretary of State for Home Affairs and Agriculture, Scottish Office (Mr. Alick Buchanan-Smith)

We have had a useful debate. I thank those hon. Members who have welcomed the scheme. But, of course, we could not get through without a little carping, which was to be expected from the source from which it came. After the general welcome, the small anarchical comments we had from the hon. Member for Renfrew, West (Mr. Buchan) were to be expected. The way in which other hon. Members welcomed the scheme made one feel as though one were at a feast, but any feast at which the hon. Member for Renfrew, West is present would not be complete unless the death's head was there as well.

Although the hon. Gentleman welcomed some things in the scheme—it is always nice to have his welcome—I must compliment him on making the same speech tonight that he made in Standing Committee this morning. I shall be interested over the Easter Recess to compare the reports of the Standing Committee and of the House. The hon. Gentleman raised a chink tonight, as he did this morning, in the curtain of the Labour Party's policy towards government and gave a thinly veiled hint of the nationalisation of land, which I know lies close to his heart. It is a point which should be noted. I should be out of order in dealing with it now, but I am sure it has not been missed by my hon. Friends and will not be missed by people outside in industry.

The hon. Member for Walthamstow, West (Mr. Deakins) and others asked about items excluded as far as low ground is concerned. It is only fair to say that in a farm capital grants scheme, as in any other such scheme, every Government must decide the priorities. I accept that some of these low ground items, such as fencing, have been of considerable value and benefit to the farmers concerned. But the important point is the resources available, and we have decided to concentrate help and financial assistance on those items which we believe to be of the greatest importance. We believe, although we appreciate the value of some low ground items to farmers, that it is more important now to pay attention to things such as drainage, an item which has been strongly welcomed.

The question of shelter belts has been raised. We have concentrated on items which we believe to be not so eligible in the capital sense and on others, such as shelter belts, in which there has not been so much interest on low ground as there has been, perhaps, on higher ground. The shelter belt assistance has been running at the rate of grant of only about £9,000 a year. Important as this was to those concerned, it was obviously not of very wide application.

The other point I make is that there are still grants available from the Forestry Commission for planting shelter belts where the amount planted is in blocks of over one acre.

Mr. Buchan

Did the hon. Gentleman say that the reason for the change in some of the low land grants was a soundly-based agricultural one or the result of the amount being spent on drainage and, therefore, purely an economic pressure?

Mr. Buchanan-Smith

I said that it was a combination of factors which accounted for it here. One of the major ones is that, within the resources available for this scheme, we have decided to concentrate on what are believed to be the most important items. Shelter belts are only one, and we believe that has not been widely used although it has been of benefit to those who have used it. Scrubland clearance against rabbits is another item in which interest has declined in recent years. As I say, it is a combination of factors, and I have mentioned one or two of the major and more important ones.

My hon. Friend the Member for King's Lynn (Mr. Brocklebank-Fowler) singled out one item in relation to claying and marling and he asked why it should be excluded. This is not an item which appeared in the Scottish scheme. It is peculiar to England and Wales. It made and can still make a fundamental improvement to soil structure in limited circumstances. While it gives help and encouragement where it is needed, we believe that money spent and resources devoted to drainage are of wider value. It is more widely appreciated and used throughout England and Wales and Scotland, whereas claying and marling is more limited. The widespread need for drainage puts it in a special category for grant purposes as compared with claying and marling. That is not to say that claying and marling is not important. It is very important in those circumstances where it applies. Perhaps that answers the point of the hon. Member for Ren- frew, West about why we have proceeded in the way that we have.

A number of maters were raised in relation to drainage, and it is on drainage that the debate has tended to concentrate. My hon. Friend the Parliamentary Secretary gave the figures for England and Wales. Last year some 215,000 acres were under improvement in terms of these schemes. The figures for Scotland are encouraging. In 1971 some 115,000 acres costing £1 million were in hand.

My hon. Friend the Member for Derbyshire, West (Mr. Scott-Hopkins) asked about the remaining land for improvement. It is interesting to look at the Strutt Report, which concluded that some 7 million acres were left which were susceptible to improvement by drainage. In Scotland we have not had the benefit of such a recent report, but the Duncan Report of 1950 estimated that some 270,000 acres suffered from imperfect drainage, and we have no reason to believe that the figure today varies very much from that.

There is little doubt that in concentrating on drainage, the benefits to individual farms in terms of resources and the higher production of food and the benefits to the nation as a whole of this very important scheme are very great.

It is obviously important to make certain that grant applications are properly vetted regarding cost benefit. I can assure my hon. Friend the Member for Derbyshire, West that officials of both Departments are alert to this point of making sure that, in considering applications, they apply proper standards of cost benefit.

One point which is sometimes inclined to be overlooked is that while the Government devote a lot of public money to assist these schemes to be carried through, there is a big stake by the individual farmer as well. I believe that the individual farmer, whether in England and Wales or in Scotland, has sufficient commercial acument and common sense to realise that he must make certain that he gets a return on his own investment.

I know of examples where improvements have taken place which have not been followed up and the improvements have fallen into disuse. Such cases are the exception, and it is the exception which gathers the most attention. However, the great mass of farmers are responsible people who do not allow their own and public resources to be wasted.

I think I have answered all the specific points which have been raised. However, I should like to emphasise, in contrast to the slightly carping remarks of the hon. Member for Renfrew, West, and in strong support of what was said by by hon. Friend the Member for Torrington (Mr. Peter Mills), the tremendously encouraging upsurge that there has been recently in farmers' investment in buildings and grant-aided works. For the hon. Member for Renfrew, West to speak of an act of execution which concentrates the minds of farmers is absolute nonsense. We are not talking about the removal of grants; we are talking about a reduction on some items of 10 per cent. Compared with the grant which is given, it is not a desperately large item.

Last year in England and Wales the value of completed schemes rose by 36 per cent. from £66 million to £90 million, while the estimated cost of approved new projects showed an even bigger rise of 58 per cent. from £77 million to £122 million.

Last year in Scotland the value of completed schemes rose by 50 per cent. from £10 million to £15 million and the estimated cost of approved new projects showed an even bigger rise of 69 per cent. from £16 million to £27 million. This certainly shows that, whatever confidence hon. Gentlemen opposite may have in the industry, the present Government and the farmers themselves have confidence to put this amount of money into it. The Government are prepared to back up the confidence of those in the industry with the kind of help which we are giving through schemes such as these. I have great pleasure in commending them to the House.

Mr. Farr

Will my hon. Friend say whether the grant will apply to the drainage of a bog? I raised that point and he has not answered it.

Mr. Buchanan-Smith

If it is on eligible ground and meets the cost benefit test, yes. Some bogs—I have seen some very good bogs—are well drained and restocked as a result. If my hon. Friend cares to come to Scotland, I am sure I could show him some. Of course, there are some which are not eligible for grant for drainage. However, my hon. Friend knows that we approach this matter with common sense. We will certainly bear in mind what he has said.

Question put and agreed to.

Resolved, That the Farm Capital Grant (Variation) Scheme 1972 (S.I., 1972, No. 368), a copy of which was laid before this House on 16th March, be approved.

Resolved, That the Farm Capital Grant (Variation) (Scotland) Scheme 1972 (S.I., 1972, No. 362), a copy of which was laid before this House on 16th March, be approved.—[Mr. Buchanan-Smith.]