HC Deb 01 March 1984 vol 55 cc409-15 4.31 pm
The Minister of Agriculture, Fisheries and Food (Mr. Michael Jopling)

With permission, Mr. Speaker, I would like to make a statement on the Council of Agriculture Ministers, which took place in Brussels on 27 and 28 February. I represented the United Kingdom Government with my hon. Friend, the Minister of State.

Most of the time of the Council was taken up in detailed discussion of the Commission's price proposals and adaptations to the common agricultural policy. No decisions were taken, but there was further clarification of individual national positions on the various commodity sectors and other issues. These negotiations will be resumed at a further Council meeting next week.

The Council agreed that the existing structure directives should be extended with effect from the beginning of the year until the end of June. Under this agreement, FEOGA will contribute in the normal way to payments made since 1 January under the Community schemes for capital grants and hill livestock compensatory amounts. Aids to dairy investment are not included in the roll-over. This means that no applications for development plans under the agriculture and horticulture development scheme, which include dairy investments, will be accepted from today onwards. Nor will claims be accepted under the agriculture and horticulture grant scheme on dairy expenditure incurred from today onwards.

I am pleased to be able to tell the House that the Council agreed to the extension of the less-favoured areas in the United Kingdom. This is an important decision for about 28,000 farmers on about 3 million acres of marginal areas. As foreshadowed in my answer to my hon. Friend the Member for Torridge and Devon, West (Sir P. Mills) on 30 November, it enables the Government to make arrangements for paying enhanced rates of capital grant in the marginal areas and to consider in the autumn review appropriate intermediate rates of hill livestock compensatory allowances to be applied in 1985.

The Council also agreed that the present import arrangements for New Zealand butter should be extended for a further month so that 20,750 tonnes can be imported during the first three months of 1984 pending a decision on the proposal which the Commission has made for a five-year agreement.

Mr. Robert Hughes (Aberdeen, North)

I am grateful to the Minister for the statement. Is there any prospect of agreement over the next few weeks, during which the right hon. Gentleman is going to Brussels yet again? Will he publish in the Official Report what is happening inside the Council of Ministers as regards the different proposals? It is not enough for those of us who have to try to follow these matters carefully to skim through the pages of the popular, or the unpopular, press to find out what is happening.

I welcome the extension of the less-favoured areas scheme, as far as it goes. Will the right hon. Gentleman give us some more information by publishing, as soon as possible, a detailed map so that we can see the areas that are affected? Will he tell us something about the extension of the less-favoured areas? What will be the cost? Is it not the case that if we were to go on the figures in today's press of 1 million ewes and 100,000 cows, in today's rates that would be a total of £8.75 million, of which we should have to find 75 per cent.? Whatever the order of the money, will there be new money? Given that the public expenditure White Paper shows that the budget of the Minister's Department will be substantially reduced, does that mean that the additional money will come from other programmes, such as land drainage?

What will the rate be for these new less-favoured areas? Why do we have to wait until the autumn to know what it will be, when we know, both from the speech that the Minister made at the Tory party conference in October last year, and his statements, that he is thinking of some sort of intermediate rate, so far unspecified, for the hill livestock compensatory amounts? Why is it that there will be no money going into these areas until 1985? We need answers to these questions?

As I understand it, from the part of the right hon. Gentleman's statement about the development schemes and the capital grants in relation to dairy investments, no matter how small the dairy element of a development plan might be, the total cost of that plan is disqualified under the scheme. Is that what the right hon. Gentleman is saying, or is he saying that only purely dairy investment will be disqualified? The statement speaks of schemes "which include dairy investments" so we shall need clarification on that. Is not cutting this off today particularly difficult for those farmers who are trying to plan ahead and get developments, and trying to raise private capital for the future?

Mr. Jopling

The hon. Gentleman has asked me a number of questions. First of all, with regard to the prospects for agreement, I believe that there is a general determination in the Council to try to seek agreement on 1984 prices and the broader restructuring of the common agricultural policy as soon as possible. Efforts will be made—I do not know whether they will succeed—to reach agreement before the European Council meeting on 19 March. The hon. Gentleman asked me whether I would publish details of the negotiations. That is difficult, because it is a negotiation and the positions of some states on certain issues change even within a day.

I have with me some of the broad maps showing what parts of the country will be included in the extended areas of the less-favoured area. The best thing would he if I deposited copies in the Library. It is possible that they are there already, but if not I shall ensure that they are put there as soon as we can possibly do so.

As to the cost of this, we have to go into the details of the extension of the less-favoured areas. We are not yet in a position to publish the details.

The figure of £8.75 million referred to by the hon. Gentleman was for the hill farming compensatory allowance. In general, those allowances will be at about half the rate for what I would describe as the high hills. On top of that, capital grants will be available at the high hill rate in the newly created marginal areas. I am pleased to say that marginal areas will be included in the public expenditure amounts available in the next financial year, as I explained in my earlier statement.

With regard to dairy aids, the suspension will apply to all expenditure incurred from today in relation to the new arrangements under the agriculture and horticulture grants scheme. Works already completed but not yet claimed for, and work in progress will be eligible under existing provisions. Similarly, the agriculture and horticulture development scheme will not apply to approved plans or variations, work carried out or in progress in anticipation of approval of a variation, or to plan applications received before 1 March but not yet approved. I hope that that will be helpful

Several Hon. Members

rose—

Mr. Speaker

Order. I have already said that a heavy day is in front of us, and I ask for brief supplementary questions and answers.

Mr. Edward du Cann (Taunton)

Is my right hon. Friend aware of the growing appreciation in the British farming industry of his skills as a negotiator as his successes become apparent? Even so, I have not seen such low morale in the farming industry or so much apprehension about the future during my time in the House. Will my right hon. Friend take as the starting point in his future negotiations over prices—we all wish him success—that it is essential for the British economy that a prosperous and effective British agriculture should be maintained?

Mr. Jopling

I am grateful to my right hon. Friend for those remarks and for what he said earlier. I am well aware of the uncertainty in the agriculture industry. I have referred to it before in the House as well as at meetings of the Council of Agriculture Ministers, where I urged that a decision on the restructuring of the common agricultural policy should be reached as quickly as possible, to put an end to the uncertainty. However, we are faced with grave overproduction and overspending on the budget and we must do something about that.

Mr. J. Enoch Powell (Down, South)

In which Estimates does the Minister expect that the specific provision for the additional less-favoured areas will first appear?

Mr. Jopling

I am not yet sure when we shall be able to start paying the capital grant rates for the high hills to farmers in those areas. I suspect that it will be done in the next financial year. The hill livestock compensatory amounts, as I said earlier, will be subject to the normal review of upland areas next autumn and will become eligible for payment from 1 January 1985.

Rev. Ian Paisley (Antrim, North)

Will the hon. Gentleman confirm that the application for an increase in less-favoured area status for Northern Ireland from 45 per cent. to 75 per cent. has been accepted, giving an additional 30 per cent.? I am sure that the right hon. Gentleman is aware that the criteria for granting status to the original 45 per cent. were also met by the other 30 per cent., which was not then included. Can the right hon. Gentleman confirm that the capital grant in the new area will be the same as for the original area, and tell us what other grants will be available for the extended area, and when they will apply to Northern Ireland?

Mr. Jopling

The details of the scheme's application to Northern Ireland are a matter for my right hon. Friend the Secretary of State for Northern Ireland. The agricultural development programme for Northern Ireland is governed by a separate regulation. However, the Northern Ireland grassland scheme provides enhanced rates in the marginal areas.

Mr. Tam Dalyell (Linlithgow)

Will the right hon. Gentleman put our minds at rest about the disquiet felt by the director of the Council for the Protection of Rural England, Mr. Robin Grove-White, that the EEC negotiations will have devastating implications for wildlife?

Mr. Jopling

I do not believe that that will be so. Wide understanding of the needs of the environment has been shown in the negotiations that I have attended in Brussels.

Sir Peter Mills (Torridge and Devon, West)

Will the Minister accept my congratulations, on behalf of the industry, on the progress that he has made in difficult circumstances while trying to reach agreement over surpluses with the Ministers of many countries? Will he, further, take no notice of the unfair and unjustified criticisms from some parts of the National Farmers Union, and continue to fight and do his best in difficult circumstances for British agriculture, especially to ensure, in particular, that there is fairness throughout the Community, and that the reduction is negotiated very gently?

Mr. Jopling

I am grateful to my hon. Friend. I shall continue to battle on behalf of British agriculture, which is one of the jewels in the crown of British industry. I shall continue to do my utmost to make sure that the difficult decisions that must be taken will not discriminate against home agriculture.

Mr. Geraint Howells (Ceredigion and Pembroke, North)

I feel sure, Mr. Speaker, that you will realise by now that we are being complimentary to each other today. I am not sure whether that is due to the influence of Wales's patron saint, Saint David. May I add my tribute of thanks to the Minister? Many of the 28,000 farmers living in the marginal land areas are in Wales and they will be delighted at the news that the Principality has been included in the marginal land scheme on Saint David's day. Does the Minister hold the view that the new scheme will stem depopulation from the rural areas and restore confidence? Can he give an assurance that payments will be made in 1985 to marginal land farmers, and that money will not be taken from the hill farmers to pay those moving into the extended area?

Mr. Jopling

On the last point, I can give that assurance. I am anxious that these payments should not be made by taking money from those farming in the high hills. I hope that the new marginal land grants will help to restore confidence in a difficult area. I first made speeches about the difficulties of farming in those marginal areas about 19 years ago, and I have waged a long campaign for them. This result gives me considerable personal satisfaction.

Mr. Peter Hordern (Horsham)

Will my right hon. Friend tell the House whether the marginal land scheme includes those areas where it is difficult to farm, especially the weald of Sussex—it is difficult to find land that is more difficult to farm—and upland areas of the Sussex downs? If those areas are not included, will my right hon. Friend explain why not, considering that most of the weald is farmed by small tenant farmers? Will he agree that there is room for a change in the balance of farm support away from cereal farmers and in favour of pig and chicken producers?

Mr. Jopling

I entirely agree with my hon. Friend about the current imbalance between grain and livestock. I am doing my utmost to correct that imbalance and shall continue to do so. With regard to the weald of Sussex, it is news to me that parts of Sussex are hard to farm. I always believed that it was the land of Goshen. I shall let my hon. Friend know whether those areas are included, and no doubt he will be able to see for himself when the plans are deposited in the Library.

Mr. D. N. Campbell-Savours (Workington)

Is the Secretary of State aware of a resolution carried by the National Farmers Union in Cumbria, which includes his constituency, condemning the Government's failure to negotiate satisfactory arrangements for British farmers? Is he aware of the great concern of farmers in Cumbria about the arrangements for livestock and milk production support? When will there be a successful outcome to the negotiations in Brussels and why is uplands amenity money being taken out of the uplands livestock budget?

Mr. Jopling

The hon. Gentleman cannot have been listening. I have just given an undertaking that the new money for the marginal areas will not be taken from farmers on the high hills. I have not had news direct from the Cumbria NFU but I am glad to say that in a discussion earlier today with the Westmoreland Gazette—a well-known and extremely responsible newspaper in the area—I was informed that the Cumbria NFU was delighted at the extension of the less-favoured area provisions.

Mr. Robert Hicks (Cornwall, South-East)

I, too, welcome the extension of the less-favoured area provisions to marginal land. Will my right hon. Friend confirm that where there is a dispute about classification as marginal land the normal local inquiry procedure will apply if a farmer wishes to challenge the Department's ruling?

Mr. Jopling

I am most obliged to my hon. Friend. We have both felt strongly about the marginal areas for many years. With regard to farmers who wish to appeal against exclusion, I shall make an announcement at the appropriate time about the representation procedure to be introduced for farmers whose land is excluded from less-favoured area status.

Mr. Eric Deakins (Walthamstow)

Can the right hon. Gentleman cite even one major reform of the common agriculural policy likely to be agreed by the Council of Agriculture Ministers before the meeting of Heads of Government later this month? If he cannot do so, does not that seriously undermine the negotiating position of his right hon. Friend the Prime Minister at the meeting of Heads of Government?

Mr. Jopling

If the Council of Agriculture Ministers cannot reach conclusions before the meeting of Heads of Government on 19 March, the job of the Heads of Government will be a good deal more difficult. I believe, however, that there is a general understanding among Agriculture Ministers—this was certainly apparent in Brussels earlier this week—that we must do all we can to resolve as many of our difficulties as possible and to leave as few items as possible outstanding for the Heads of Government.

Mr. Jim Spicer (Dorset, West)

Does my right hon. Friend accept that livestock farmers will be most grateful for his firm statement about the imbalance between the cereal and livestock sectors? Without going too far, can he say whether the views that he has expressed so firmly today are shared by other Ministers in the Council?

Mr. Robert Hughes

If they were, there would have been agreement by now.

Mr. Jopling

I believe that they are. The hon. Member for Aberdeen, North (Mr. Hughes) says that in that case agreement should already have been reached, but there is nothing unusual about agreement not having beer reached at the very beginning of March. If the hon. Gentleman checks the record for earlier years under both Labour and Conservative Governments, he will find that the average date for settlement of the annual price-fixing is a great deal later than 1 March. I believe that we are making good progress and I hope that a settlement will be reacted very soon.

Mr. Colin Shepherd (Hereford)

May I underscore the compliments already paid to my right hon. Friend on his progress on behalf of this important industry? When he indulges in further negotiations next week and thereafter will he bear in mind that support for United Kingdom farming has been steadily declining as a proportion of output and that farming profits in real terms have declined sharply in the past decade? Is he aware that in real terms total United Kingdom farming income is lower than it has been since 1945?

Mr. Jopling

I do not accept that projected farm incomes for 1983 are lower in real terms than at any time since the war, as the projections for 1983 were higher than the figures for some years. Nevertheless, I am conscious that in real terms farm incomes are lower than they have been in recent years. That is constantly in my mind.

Mr. Mark Hughes (City of Durham)

I wish to ask two short and specific questions. First, will the Minister return to the question asked by my hon. Friend the Member for Aberdeen, North (Mr. Hughes)? The right hon. Gentleman said in his statement that from today onwards no applications would be accepted under the agriculture and horticulture development scheme for plans which included dairy investments. If just 1 per cent. or 2 per cent. of the plan involves dairy investment, will the whole plan be excluded or only the proportion relating to dairy investment?

Secondly, in the light of the expenditure White Paper issued a few days ago, can the right hon. Gentleman tell us which Peter is being robbed to pay this Paul? The White Paper states that provision has been made to provide more money for this scheme, which we welcome, but the Ministry's total agriculture budget is being reduced" so where is he finding the money for this?

Mr. Jopling

I can put the hon. Gentleman's mind at rest on the first question. Businesses with mixed enterprises will be eligible for grant for their non-dairy investments. I hope that his hon. Friend the Member for Aberdeen, North (Mr. Hughes) will forgive me for not saying that earlier.

On the second point, I refer the hon. Gentleman to the statement last year, when the public expenditure figures were announced. Various adjustments were made to capital grants and other matters, which we discussed earlier today, and I announced that we had found money out of the budget for various new schemes, including the glasshouse scheme and the extension of the less-favoured area provisions. The hon. Member will find that that is firmly on record.