Forestry

HC Deb 02 December 1985 vol 88 cc128-36

Motion made, and Question proposed, That this House do now adjourn.—[Mr. Peter Lloyd.]

11.45 pm

Mr. Archy Kirkwood (Roxburgh and Berwickshire)

The borders and south-east Scotland as a whole represent a perfect geographical and topographical area within which to consider the wider national and international aspects of forestry as well as the important part that it has to play in the local borders rural economy.

I remind the House of the inordinately high level of imports of timber and related products that is countenanced at present. We spend about £4,000 million per annum on importing raw material—92 per cent. of total United Kingdom requirements. Home-grown timber could secure a high level of import substitution, which would benefit local economies such as south-east Scotland and the country as a whole. As only 9 per cent. of the United Kingdom is presently planted as commercial forest—although the figure in the borders is nearer 12 per cent.—there is clearly capacity available to achieve that high level of import substitution.

The production potential of our present forestry is maturing fast, and I understand that it is expected to double in the next 10 years. Therefore, we are on the brink of a significant potential expansion of the whole forestry enterprise and its related harvesting and processing industries.

In my last Adjournment debate on the borders two years ago, I expressed my fear that the Government were proposing to dismantle the Forestry Commission by stealth, by allowing wholesale and indiscriminate disposal of large expanses of forest in areas such as the borders. While still being critical of aspects of that policy—principally its continued insistence on keeping the purchase prices and the identities of purchasers secret—I am less worried now than I then was. It is true that two large forests in the borders have been sold. but the policy announced in 1984, which put the emphasis on rationalisation, has had an important and welcoming effect on the forestry enterprise and the morale of the local work force.

I pay tribute to those who work for the Forestry Commission in the borders. They are a dedicated band of professionals who carry out physically demanding and often dangerous jobs with a great deal of skill. They have played their part in achieving the results announced recently in the Forestry Commission's annual report. Those results show that they are ahead of financial targets set for them by Ministers.

If the amalgamation of the conservancies and the slimmed-down organisation is delivering the goods in the way that it seems to be, why not allow the commission to develop and refine its rationalisation policy to include purchasing forests and planting land where it can be shown that it would make economic sense to do so? At present the savings made go back to the Exchequer, and there is very little local incentive in south-east Scotland or elsewhere to do better simply to line the pockets of the Chancellor of the Exchequer.

I welcome the statement that was made some months ago by the Minister of State who sits in the other place, when he publicly embraced the concept of a mixed economy in forestry. I support that view, but the Minister will be aware that the private forestry interests in the borders and elsewhere have recently been expressing some concern at the way in which the Department continues to administer the forestry grant scheme, and the consultation process involved in that scheme, when it comes to releasing land for forestry.

The view is that the Department is still adhering to the principles adumbrated first in 1939, when grazing land and lower pastures were completely sacrosanct from afforestation. Will the Minister accept that times have now significantly changed? Will he accept that, against the background of agricultural surpluses and the current debate about agricultural land use, forestry should be considered as a part of the solution to the surplus problem?

Private industry, as well as individual farmers, can play a part in future, to everyone's benefit. Of course, there must be safeguards in terms of the integration with the livestock sector, which is very important. There must be safeguards in terms of access for the public and the preservation of rural jobs. Both private industry and farming interests would measure up, if they were given a lead by the Government, to achieving most of the aims and objects. As an example of the sensitivity of private industry to some of those aspects, I cite the publication of the "Forestry and Woodland Code", produced recently by Timber Growers UK. It is a voluntary code, but I believe that it is a welcome contribution to the debate on conservation.

Mr. John Home Robertson (East Lothian)

The hon. Gentleman has been generous to the private sector. He has been talking about safeguards to protect aspects of land use. He must be aware that in his constituency and in part of mine, which is on the border of the hon. Gentleman's, large areas of marginal farm land have recently been planted without the consent of the Forestry Commission or the Ministry of Agriculture, Fisheries and Food. Is the hon. Gentleman not concerned about the uncontrolled blanket of afforestation of some areas of south-east Scotland?

Mr. Kirkwood

That is a useful intervention, because it substantially contributes to my next point. There are potentially serious problems in the issue raised by the hon. Member. The Department cannot sit back and wash its hands of the problem, which may, if the industry does not face its responsibilities, lead us towards the introduction of planning regulations for forestry and agriculture. I am loth to pursue that line, but it is up to the industry, and I think that it should be given a chance with the voluntary code that I mentioned. I agree with the point made by the hon. Member for East Lothian, that if the industry does not adhere to the code, it will have to pay the price and face statutory regulations, which will not be in anybody's interests, but which may be inevitable.

In the statement last week announcing the relief for the bad summer weather, I noticed that the Minister said that he was prepared to implement article 15 of the European Community's agricultural structures programme. Surely that announcement, which if introduced will allow farmers to claim HLCAs for up to 15 years if they take stock off the land and plant trees, points to one of the ways forward. We could introduce a sensible scheme of farm forestry. I recognise that there are difficulties in planting a standing crop that lasts for 40 years before it matures and can be harvested. That produces legal problems for the traditional farm tenancy arrangements in Scotland, but I believe that, with application, and if the Government took a positive lead, we could resolve some of the problems to the satisfaction of farmers, who want to turn some of the their surplus agricultural land over to afforestation.

Last week's announcement by the Minister to deal with the problem south of the border points the way forward for farm forestry. If that is the way that the Ministry in England has chosen, a more flexible approach is required from the Department of Agriculture and Fisheries for Scotland to releasing land of better quality than class 4B, if it is suitable for sensitive exploitation by the private sector for agricultural interests. In evidence I quote the chairman of the Nature Conservancy Council, who said: forestry should be encouraged on lower land and grants should be paid to support sheep farming on higher land. That quotation is from The Guardian of 26 November 1985.

I was also interested to read a written answer that the Minister gave to his hon. Friend the Member for Stirling (Mr. Forsyth), who asked the Secretary of State for Scotland if he will list the number of local jobs per hectare supported by the principal land based activities in Scotland. The Minister replied: The numbers of local jobs provided per 1,000 hectares by the principal land based activities in Scotland are as follows:

	Number
Dairy farming	31
Lowland crop and stock farming	22
Upland mixed farming	8
Forestry	7
Hill sheep farming	1"

—[Official Report, 4 December 1984; Vol. 69, c. 150.]

I am sceptical about those figures, as I was brought up to believe that in a contest between sheep and trees, one is always safer with sheep. I am interested in the figures, and it is right that we should look at them carefully. If the figures are right, we should look at forestry in terms of employment as well as in terms of taking surplus agricultural land out of use.

If all that is to happen, the Government will need to consider adopting a more radical and open policy , not just for land use, but for providing infrastructure support. I shall give an example in the south-east of Scotland. The Borders regional council no longer has access to European Community infrastructure grants because its development status has been removed. It cannot repair roads, much-needed and used by the industry, whether public or private, from the needs element of the rate support grant. I shall not go into that further. It is a subject for another debate on another day, probably tomorrow, if the press announcements are right.

The Government will need to sponsor research and to develop the downstream industries, and not just confine their interests, as they have in the past, to securing the planting of trees. They will also need to turn their attention to training young people to become not just foresters and harvesters, but forestry processors. As the Minister may know, the Scottish Development Agency, in association with Borders regional council, is looking at two areas in my constituency to see what rural development can be promoted there. Will the Minister ensure that any forestry related developments that might be identified as future projects will get ministerial support?

My purpose in raising this subject is to alleviate the consequences of what I perceive as the potential rural depopulation, which, if we are not careful, will flow from inevitable changes in the agricultural sector in the coming years in south-east Scotland and other parts of rural Scotland. Forestry is a unique and commercially viable alternative source of stable employment, and with consistent husbandry and proper control it is infinitely renewable. That makes it different from just about every other industry, whether coal, oil or any other of the important industries in Scotland. Forestry is infinitely renewable if looked after properly.

Forestry has an important part to play in a local context in south-east Scotland and in the broader national economic strategy for the United Kingdom. If properly developed, it offers tremendous potential for rural betterment and prosperity, but the Government have a vital part to play by drawing together the diverse strands, consulting all the interested parties and setting out the right framework to enable the industry to realise its potential to the full.

11.57 pm

The Parliamentary Under-Secretary of State for Scotland (Mr. John MacKay)

I listened with great interest to what the hon. Member for Roxburgh and Berwickshire (Mr. Kirkwood) said about forestry in south-east Scotland, and in general. Some two years ago he raised a debate on the Adjournment of the House on the problems confronting forestry. It is significant that today's debate is taking place against a different background.

If forestry is to flourish, it has to be geared to the markets for its timber, and much of the wood processing industry now operates on a scale that transcends regional boundaries. There is a tendency to think of forestry as a rural and therefore local activity, but that is true only up to a point. The forests are there to produce timber, and to serve the needs of industry, and the scale and pattern of market demand mean that it is difficult, if not impossible, to look comprehensively at forestry in any part of the country in isolation. We have to take account of the situation at least on a Scottish, if not a Great Britain, basis. More particularly, in the south-east of Scotland, we have to look at the Great Britain picture.

Let us look, therefore, at forestry in this country. We need go back only some five years, which is a short period in forestry terms, to find an industry in some trouble. When we came to power in 1979, there was more doom and gloom about than optimism. New planting by the private sector, which is always a reflection of the confidence of the industry, was at a low ebb. The wood-processing industry was faced with the impact of a worldwide recession, and as a result many closures occurred with the loss of jobs and capacity for processing home wood supplies. The future of the whole industry was, to say the least, uncertain.

The Government then embarked on a major review of forestry policy, the outcome of which was announced to the House by my right hon. Friend the Secretary of State in December 1980. The policy was designed to help get forestry back on its feet and in a position to take full advantage of the increasing output of timber from the nation's forests. But equally important, it was a clear message that the Government backed forestry. The hon. Gentleman mentioned our forestry product imports, which are a good reason for an increased forestry policy.

Mr. Home Robertson

Will the Minister give way?

Mr. MacKay

I should like to make progress, in view of the time.

Contrast the position today with that of five years ago. Confidence has returned in full measure and forestry in Britain is now going from strength to strength. The Government's forestry policy has played its part in that renaissance, aided by our determination that industry in general should find its competitive edge once more. The transformation has been far from easy. Tough decisions have had to be taken, but they have paid off, and the industry is now geared up for the future.

Regarding new planting, I am pleased to say that the private sector has responded well to the challenge that we set it. A new forestry grant scheme was introduced in 1981. While in Great Britain the amount of new planting carried out by the private sector in the year to March 1980 was some 8,300 hectares, the figure had nearly doubled to more than 16,000 hectares in the year to March 1985. Scotland had by far the major slice of that, with more than 14,000 hectares of private planting, in marked contrast to the 6,900 hectares in 1980. That is all apart from a continuing planting programme by the Forestry Commission of 5,000 hectares throughout the country, again with the bulk of the planting, some 4,500 hectares, in Scotland.

Now we have a further impetus to new planting by the private sector through the launch in October this year of the broadleaved woodland grant scheme. This is part of the Government's policy on broadleaves announced by the Secretary of State on 24 July 1985. Although these are early days, I gather from the Forestry Commission that the scheme has attracted a massive amount of interest, and it seems that we shall see many more broadleaves planted. The new scheme has particular relevance and interest to farmers, in that well managed woods can not only be productive in timber terms, but can bring shelter and sporting benefits, as well as being of value in conservation and amenity terms.

The way in which the wood-processing industry has turned round in the past five years is remarkable. This year alone has seen the coming on stream of two major plants—United Paper Mills newsprint mill at Shotton in north Wales, and Highland Forest Products structural composition board plant near Inverness. Those two developments alone will require a total of 600,000 cubic metres of home grown timber a year, and will make up for the capacity lost as a result of the three pulp mill closures in the recession in 1980. The other major development in the pulp and paper sector, dependent on home wood supplies, was the major expansion by Thames Board Mills at Workington to increase its capacity for the production of cartonboard. Other developments have taken place in the particleboard industry—with future expansion intended at plants at Hexham and Chirk—and in sawmilling, where significant expansion has taken place in Scotland with investment and modern technology to meet the growing volumes of material coming on to the market. Those developments have not only provided new jobs in the processing industry but have been instrumental in establishing and maintaining jobs in the timber and haulage industries. They are proof of the vigour and enterprise of the domestic forestry products industry and tangible evidence of the Government's efforts during the past five years to stimulate and encourage new industrial investment.

How does all this good news relate to south-east Scotland? Clearly, what is good for forestry in general is good for forestry there. We now have the crucial element of secure markets for the timber from the area, which is the best possible guarantee of job security for many of those who work in the industry.

The hon. Gentleman discussed the jobs in downstream activities in south-east Scotland. It must be appreciated that in the pulp and paper sector, as well as in the wood-based panel sector, large-scale wood-processing developments are essential to provide a sound basis for the industry in Great Britain. Investments must be on the large scale necessary to compete effectively with imports. One of the crucial factors attracting industry to Great Britain is our ability to guarantee an adequate and continuous supply of timber now and in the foreseeable future. Here the Forestry Commission has a key role to play, with the result that over large parts of the country the planned output of timber from commission forests over the next few years is substantially committed to secure markets.

Bearing in mind the enormous quantities involved, timber supplies to major developments in this country have to come from far and wide. They are of direct benefit to a great many rural areas in providing a stable and continuing demand and thus a guarantee of continuing employment in harvesting and haulage. When it comes to location, a great many factors have to be taken into account, and the final decision is a commercial one which only the investor can make.

This does not mean to say that there is no scope for expanding or establishing smaller locally based wood-processing plants and mills. Far from it. Indeed, there are many examples of such developments in sawmilling in Scotland. But this is not so much a matter of broad strategy as of local initiative. I particularly welcome the fact that the Borders regional council, backed by the SDA, is proposing to carry out a feasibility study which will cover the opportunities for local timber processing likely to present themselves in coming years. Like the hon. Gentleman, we welcome that. It rests with local people to seize on any opportunities identified in that study.

South-east Scotland contains about 70,000 hectares of managed forests. At present the Forestry Commission is producing just under 100,000 cubic metres of timber from local forests, and private forests are producing about half this amount. Supplies of small roundwood go to various outlets. Some are sent to the Shotton newsprint mill, some to Thames board mill at Workington, some to Caberboard at Stirling, and to the particleboard mill at Hexham recently acquired by Egger Ltd.

Sawlogs form just under half the total output and are supplied to a number of sawmills some of which are located within south-east Scotland. The area—in common with the rest of Scotland—is expected to have a significant growth in wood production over the next 10 years—of the order of 80 per cent.—which is bound to have a beneficial effect on employment. It is not possible to say how much of the extra production is likely to be processed locally, but at least the raw material will be there, and as I have already said there is scope for local initiative.

As for future planting, we are looking to the private sector to continue to expand. In south-east Scotland over the past two and a half years, some 2,500 hectares of new planting have been carried out under the Forestry Commission's forestry grant scheme. In the same period, 9,500 hectares have been cleared for planting, and this shows that interest continues at a high level and augurs well for a steady expansion of the forest estate. This coupled with an increasing restocking programme in both commission and private forests, should help to secure employment.

The hon. Member for East Lothian (Mr. Home Robertson) and the hon. Member for Roxburgh and Berwickshire referred to planting without grants and to the two cases that had occurred in south-east Scotland. Both hon. Members have raised this matter before, and I have responded in the past, not only to them but also to other hon. Members. At the risk of repeating what I have already said, these two cases are the first significant ones of their type since the introduction of the consultation process in 1974.

The Government do not wish to overreact, and I make no secret of the fact that on the basis of these two cases we do not contemplate any action, although we have made our displeasure well known in the private forestry industry. If other cases were to materialise, we should reassess the position as a matter of priority and take the appropriate action. I hope that answers the point.

The hon. Member for Roxburgh and Berwickshire made the point that planting and the expansion of forestry depend upon land becoming available for planting. I am conscious of the anxiety being expressed that not enough land is being cleared for forestry. That is a complex subject, but the Department of Agriculture and Fisheries for Scotland and the Forestry Commission are together looking at the criteria for the clearance of agricultual land for forestry to see whether changes are now called for. I shall not attempt to anticipate the outcome of those discussions, but I can assure the House that we are very much aware of the need to strike the right balance between those two important rural industries.

The hon. Gentleman drew my attention to a question from my hon. Friend the Member for Stirling (Mr. Forsyth) that I answered. I remember the figures well. I spent a wet day in the Glenorchy forest in my constituency in September discussing matters with the Forestry Commission. I discussed employment and environmental matters with the two members of staff who accompanied me. They were convinced and were able to give me figures that showed that forestry employed more people than hill sheep farming, although I suspect that they were not prepared to go to the extent that I did in my answer to my hon. Friend—showing seven jobs in forestry to one in hill sheep farming.

One of the problems that we discussed was that in forestry there are many jobs in the haulage industry—as I know, because my constituency is one of the most heavily afforested in the United Kingdom—which are difficult to quantify because the firms conduct other haulage business at the same time.

The hon. Gentleman referred to the sale of woodlands in his area. He reminded the House that he had expressed anxiety about that. I am glad that some of his fears have been proved to be groundless. I know that there have been some redundancies in the Lammermuir forest where the commission is steadily selling its interest. Those job losses are obviously to be regretted. That said, it is to the advantage of the commission and the public purse that it can dispose of the woodlands that it finds difficult and expensive to manage. The woodland at Lammermuir certainly falls into that category.

Again using Argyle and Bute as a base, I view forests as large operations. A forest seems to me to consist of many trees and at least a few hundred hectares. The Lammermuir forest consists of 2,600 hectares in 74 scattered blocks. They are obviously more awkward and difficult to look after than 2,600 hectares in my constituency, all planted fairly closely.

In forestry we have an important industry. As the hon. Gentleman hinted, the commission has made an important review of the way that it operates and has amalgamated the two-tier system of local management at district and forest level to form one level of management—the forest district. That has had an impact on local management posts, and some local offices have been closed. That is, of course, to be regretted, but if the commission is to compete and provide the wood processors with competitively priced timber, it is important that it should match its local management structure with present and future needs and with the need to produce the timber as efficiently and effectively as possible. The commission has done that. I believe that, given the agricultural surpluses, forestry provides us with a means of using the land and creating jobs. I hope that it will marry the needs of agriculture with those of the environment. All those factors are important and make up the patchwork quilt that represents the rural scene.

Question put and agreed to.

Adjourned accordingly at fourteen minutes past Twelve o'clock.