HC Deb 24 June 1985 vol 81 cc748-54

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

11.40 pm
Mr. Alexander Eadie (Midlothian)

I am initiating a debate on a proposed cut in funding of £1.1 million from a budget of £1.7 million for the Scottish Institute of Agricultural Engineering at Bush estate, Penicuik. This is part of the overall reduction of about £4 million in agricultural research expenditure.

The lunacy of cutting back upon agricultural research in Scotland is compounded by the swipe that is being taken at the Scottish Institute of Agricultural Engineering, to be found in the consultative document. Mr. David Hinton, convenor of the labour and machinery committee of the Scottish National Farmers Union, said: Our initial reaction to this document"— he was referring to the consultative document— is one of concern. The Scottish Office have proposed massive cuts in the funding of the Scottish Institute of Agricultural Engineering. The engineering work carried out at the SIAE has concentrated on the special needs of the Scottish industry, many sectors of which are markedly different from those in England and Wales. Provision must be made to continue an adequate basis for Scottish Research in this important field … The union is in the process of assessing the complete Agricultural Research and Development picture in Scotland. We will—in due course—be submitting detailed suggestions on the future of Research and Development in Scotland. We recognise the need for increasing efficiency but we reiterate our opposition to the scale and timing of these proposed cuts which owe more to dogma than logic. I suggest that dogma and logic are a regular hallmark of this Government's actions. When challenged one can only describe their answers by using Edmund Burke's classic descriptiion: the economy of truth.

It was a classic example of hamfistedness when the staff of the Scottish Institute of Agricultural Engineering at Bush estate, Penicuik, read in The Scotsman that their jobs were under threat. The policy of "shoot first, tell later", was confirmed on 18 May when they learned that the Department of Agriculture and Fisheries for Scotland, which finances the seven Scottish agricultural research institutes—the Bush estate, Penicuik section being one of them—had published a discussion paper entitled "A Strategy for Agricultural Research and Development." It detailed the financial cuts to be made in applied agricultural research in Scotland.

At present, only 7 per cent. of the £31 million Scottish agricultural research and development budget is spent on engineering. The proposed cuts would reduce this figure to less than 2 per cent., a cut of 70 per cent. The annual budget of the Scottish Institute of Agricultural Engineering of £1.7 million will thus be reduced to about £500,000 or £600,000. One would damage one's eyesight if one tried to find any reason in the document for singling out engineering for such a savage cut. That outrageous proposal is made to stand on its head when one realises that just three months ago the Department of Agriculture and Fisheries for Scotland published a document entitled "Agricultural Research and Development 1985" in which much of the work of the Bush estate institute was highlighted as being topical and of high priority. Within two months, the Department of Agriculture and Fisheries for Scotland did an about-turn. Long-term research programmes given priority in March were discarded in May.

Today, I have received a letter from the Scottish NFU. It will be making a submission. The union will be pointing out that over four months the Department of Agriculture and Fisheries for Scotland has completely altered its view of the value of agricultural research in Scotland. I do not want to go into the letter in detail, but it is a powerful indictment of the Government's policy and attitude.

A study of the consultation document reveals a number of striking inconsistencies, omissions and errors of logic in addition to a number to debatable statements and conclusions.

One criterion put forward by the Department of Agriculture and Fisheries for Scotland for the allocation of research and development funds is that output at present in surplus should receive less support. However, a respected committee of the Royal Society headed by Professor Bernard Crossland showed recently that a lack of research and development in the agricultural engineering industry between 1966 and 1980 led to a 2.6 per cent. decline in exports and a 112 per cent. increase in imports. Applying the logic of the Department of Agriculture and Fisheries for Scotland, the industry merits the additional funding recommended by that committee rather than the proposed cuts.

The Department of Agriculture and Fisheries for Scotland states its intention to support high quality research, some parts of which serve as the United Kingdom's focus of excellence. It fails to acknowledge that section of the Bush estate as a United Kingdom centre of research into the mechanisation of the potato crop in which it has an international reputation.

The Scottish Institute of Agricultural Engineering on the Bush estate is also internationally recognised for its work on soil compaction, and on the behaviour of agricultural machinery on sloping ground.

The potato crop and soft fruits are singled out as important commodities in Scottish agriculture and yet those are the sectors of the Scottish Institute of Agricultural Engineering expertise which in the past have received a low priority, or have been discouraged by the agricultural heads in New St. Andrew's house in Edinburgh.

I wish to deal with some of the economic benefits of the Scottish Institute of Agricultural Engineering. There are considerable potential economic benefits from the application of its research programmes. For a modest cost to the Department of £1.7 million per annum as well as reductions in input costs those benefits include, first, increased cereal yields through a combination of optimum soil structure, the elimination of losses due to compaction effects from straw disposal, adoption of a zero traffic system with broadcasting, and subsoil loosening. These have a potential worth of £177 million per annum in Scotland alone. The use of soil engineering to limit forest windthrow could be worth £7 million per annum in Scotland.

Secondly, grazing improvements in Scotland through strip seeding have an estimated potential value of £39 million per annum. Improved straw incorporation techniques could save £1.8 million per annum while gains from shallow ploughing could be £5 million per annum. Examples of the value to Scotland of ad hoc development work are the chicken feeder, with a saving of £2.5 million per annum, and crop deflectors, with a saving of £500,000.

Thirdly, the introduction of the institute's developed equipment and techniques to reduce potato damage could save up to £126.7 million per annum.

Fourthly, the elimination of tractor overturning accidents could save United Kingdom resource costs of £3.8 million per annum.

Fifthly, optimal forage conservation in the cool wet climate of Scotland could increase the value of home-produced forage for this region by up to £190 million per annum.

Sixthly, agriculture energy savings of £5 million per annum could be achieved in Scotland simply through efficient management based on the institute's work at the Bush estate.

Seventhly, the machine loads investigation could lead to savings for the United Kingdom in material costs of non-rotary soil working tools of £1.4 million per annum.

Eighthly, adoption of mechanical harvesting of raspberries by Scottish growers, based on the institute's machine specification, would increase profitability by £1.4 million per annum.

The benefits identified for Scotland alone would total £424 million per annum. For northern Britain, this figure could be doubled. Addition of the benefits identified for the United Kingdom as a whole — £101 million per annum—gives a total of £949 per annum. The potential benefit:cost ratio from the application of that programme in asingle year would be 500:1. If even 20 per cent. of the benefits were achieved to give a benefit:cost ratio of 100:1, this would be excellent value for public money by any standards. The benefits that are achieved will continue far beyond the duration of the projects on which they were based. Meanwhile, the cost resources can be devoted to new work to generate new potential benefits. The scale of benefit projected for the present programme is broadly similar to that obtained for completed past projects—for example, the x-ray separator—and for similar work elsewhere.

In amplifying my case, I want to quote an unsolicited letter that I received from Findlay, Irvine Ltd. It is captioned: Scottish institute of Agricultural engineering. The letter states: The proposal to cut the budget of the S.I.A.E. by a figure (according to the Press) of £1.1 million out of a budget of £1.7 million is a very damaging one. We have worked with The Bush for nearly twenty years, and although we cannot judge the quality of all their work, the projects with which we have been involved have been relevant to the needs of agriculture, and their research has produced useful devices. For instance, the Bush Recording Soil Penetrometer which is made here and sold worldwide, was originally designed at The Bush. Sales are steadily growing and make a worthwhile contribution to employment by a small local manufacturer. Research institutes in the USA, Australia, New Zealand, India, Malaysia, and Iran have all bought this instrument simply because it is the most advanced in the world. Cuts in civil service expenditure have my full support but one has to be selective. Cuts at the S.I.A.E. would strike at precisely the kind of wealth-creating process the Government is trying to foster. I should like to call in aid a report on tractor safety, for the saving of lives should have the same priority in the agriculture industry as in any other industry. The institute's work on safety is unique in Britain. It is of vital social concern, and has a worldwide reputation. The United Kingdom focus of excellence on that subject is at the institute. It is a proper research topic for public funding. The institute's work is highly valued by the Health and Safety Executive, which respects its independent position and is unable to commission similar work at any other centre in Britain, including its own research laboratories.

There are an estimated 85,000 farm accidents annually in Britain, of which 1,244 are tractor overturning accidents. The total resource costs to the British economy of those accidents is £94.3 million and £3.8 million, respectively, but the average cost of tractor overturning accidents is disproportionately high at four times the average cost of other accidents. Small and medium-sized farms account for more than 85 per cent. of total unreported accident costs. Those farms are situated predominantly in less favoured areas, and the clear relevance of tractor safety on slopes research to the hill and upland areas points to the acute need for funding such research in Scotland. The work is directly applicable to other land uses in the upland areas, especially forestry.

The institute has been conspicuously successful so far. The comprehensive research on the causes of tractor overturning accidents now provides standard training material used by colleges of agriculture, the Health and Safety Executive, the agricultural training board and the advisory services throughout the United Kingdom. The institute slope monitor and four-wheel drive engagement alarm have both been taken up commercally. The main goal of the institute's work, however, is yet to be reached—determining when a tractor is being operated safely on a slope and when it is not. Currently the tractor driver still has to operate in total ignorance of his degree of safety. If the institute's work is interrupted or terminated now, the real benefit of its achievements will be largely lost to the farming community.

The Department of Agriculture and Fisheries for Scotland proposes to set up a form of contingency fund. The annual cost of that will eventually almost match the slash in the engineering budget. But the Department has no idea what it wants the fund for. Perhaps it is following too closely the example of our southern neighbour, the Agricultural and Food Research Council, from which it takes scientific advice. It has found a need for a contingency fund, probably because it is an organisation that stands alone. However, the Department is part of the Scottish Office and has always benefited from the flexibility—to the extent that it has never needed a separate contingency fund at any time in the past 40 years. It is therefore totally inappropriate to set up such a fund when drastic cuts in the budget are proposed.

The Department of Agriculture and Fisheries for Scotland has declared a set of priorities for agricultural research in Scotland. Engineering has a vital, often fundamental, contribution to make to each and every one of them. All that potential is put at risk by the ambition to have a contingency fund.the latest status symbol. Now it may be argued that the Department has been obliged to prepare its consultation document at short notice to satisfy the demands of the Chancellor of the Exchequer to reduce expenditure. However, the manner in which engineering has been selected to bear the brunt of those costs betrays a lack of knowledge and appreciation of the serious long-term consequences for Scottish agriculture. The indecent haste associated with the consultative document published in May — a response has been demanded for June—makes it vital that the Secretary of State should be made aware of the serious consequences that can only be described as senseless agricultural vandalism in Scotland.

All those concerned with the welfare of Scottish agriculture should ensure that their views are known to the Government. The Scottish Institute for Agricultural Engineering at Bush estate in Penicuik should be expanded, not contracted.

When I led a deputation on Friday to meet one of the Minister's hon. Friend's, and I argued that the consultation period was inadequate, he said that we had nothing to worry about and that the consultative period would be extended. Will the Minister confirm that the consultative period will be extended, and that we will not be involved in decision-making at the end of June after a May publication?

12.1 am

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

I congratulate the hon. Member for Midlothian (Mr. Eadie) on raising this debate and on the way he has presented his case. I have listened carefully and with interest to the points he has made.

The Scottish Institute for Agricultural Engineering is one of seven Scottish agricultural research institutes which are funded by my right hon. Friend the Secretary of State for Scotland through the Department of Agriculture and Fisheries for Scotland. These institutes, together with those of the AFRC, constitute the agricultural and food research service which is an extremely powerful scientific capability available to meet the needs of the United Kingdom agriculture industry.

The programmes of research and development, which are commissioned by the Department of Agriculture and Fisheries for Scotland, aim to advance scientific understanding and to improve the cost-effectiveness of the output of plant and animal production systems, taking into account social, environmental and animal welfare considerations. The Scottish agricultural research institutes are centres that significantly contribute to, and in some cases lead, the agricultural research and development effort in the United Kingdom.

Our financial commitment is significant. For the current financial year the maintenance allocation to the seven institutes will total £20.1 million, with a further £3.5 million for capital, a total of £23.6 million, while a further £7.4 million of the Department's funding of the agricultural colleges goes to support research and development, comprising £6.9 million for maintenance and £0.5 million for capital. Since we came to office we have increased the level of maintenance grant to the Scottish research institutes. In 1978–79, the year before we came to power, Government allocations towards the maintenance costs of the Scottish agricultural research institutes totalled £9.4 million. In the current year we have allocated £20.1 million, an increase in real terms of 13 per cent. The corresponding figures for the Scottish Institute of Agricultural Engineering were £0.7 million in 1978–79 and £1.7 million in the current year—an increase of 26 per cent. in real terms.

Mr. Eadie

Are those figures at 1983–84 prices?

Mr. MacKay

If the hon. Gentleman had listened, he would have realised that I gave the prices at the sums spent in that year, and that the percentage increase was in real terms.

Mr. Eadie

What year?

Mr. MacKay

It does not matter what year, because the figures were expressed in real terms.

In last year's public expenditure survey, the Government decided to reduce the public funding of agricultural research and development in 1986–87 and 1987–88. That decision, which was announced in the public expenditure White Paper published in January, reflects our aim that the industry should make a greater financial contribution to the funding of the research and development from which it benefits. The reductions are being shared by the Ministry of Agriculture, Fisheries and Food and the Department of Agriculture and Fisheries for Scotland in the ratio of their expenditure on research and development. That means that, in Scotland, the planned provision for expenditure of about £32 million on research and development work at the Department's funded institutes and colleges will be reduced by about £3.1 million in 1987–88. That means that, in 1987–88, expenditure will be £28.94 million, which is a considerable sum to spend on research and development, and which does not merit some of the hon. Gentleman's lurid descriptions.

Having sketched the background, may I move to the consultation paper issued by the Department. Good management of any enterprise requires that its activities be monitored and reviewed to ensure that the essential objectives and needs are being met, and that it is responsive to shifts in the patterns of need and the demand for the services. The needs of the agriculture industry do not stand still. The industry would generally acknowledge the contribution which the work of research has made to efficiency and profitability today. In terms of yields and efficiency, the industry has developed at a tremendous rate since the end of the second world war. But the position is constantly changing. We are all familiar with the problem of surpluses; there is greater public concern for the future of the environment and its interface with agriculture; there is pressure to improve the welfare of farm animals; and there is considerable interest in the relationship between diet and health.

Against that background, it is essential that we review our strategy for the future of agricultural research and development, and that we assess the extent to which our resources are being devoted to the priorities that we consider most deserving of attention. It is also necessary to ensure that our priorities are right and that the taxpayer is getting good value for his money. In this context, it does not seem at all unreasonable to expect the prime beneficiaries from the fruits of agricultural research and development to make a contribution towards the costs. This is a matter which the Agricultural Departments are pursuing with the industry.

The present pattern and distribution of research institutes has existed for many years. Obviously there have been modifications in their programmes of research over time, but from time to time it is necessary to stand back and take a good, hard look at what is going on and to assess carefully how we should go forward. The consultation paper does just that, and proposes a strategy for the future, having regard to future reductions in public funding. It has been distributed widely to all interested parties, including the trade union interests. All the comments made will be thoroughly considered before final decisions are taken on the strategy for the future and on any organisational changes which may be required in the structure of the present research institutes.

The Scottish Institute for Agricultural Engineering, which is the subject of immediate concern to the hon. Gentleman, is one of the more recent institutes, having been founded after the war. It has close links with the National Institute of Agricultural Engineering at Silsoe in England; indeed, both institutes are governed by the same governing body, the British Society for Research in Agricultural Engineering. However, the governing body has appointed a Scottish committee to advise on the programme, staff, finances and management of the SINE and on matters relating to activities in Scotland.

The hon. Gentleman raised several specific points about the proposals affecting the institute in tonight's debate and in a letter to my right hon. and noble Friend the Minister of State, who will be responding by letter to the hon. Gentleman. I also have a copy of the response to the consultation paper from the staff of the institute. The latter document is lengthy and comprehensive, and I assure the hon. Gentleman that all the points that he and the staff have made will be fully considered. Indeed, the Secretary of the Department has told the staff representatives that he will be glad to met them early in July to discuss their representations in detail before putting the overall position to Ministers for their further consideration.

However, I wish to comment on a few points. The hon. Gentleman alleged that insufficient time was allowed for the submission of comments on the proposals. I cannot accept that we are proceeding with undue haste. A period of more than six weeks was allowed for the submission of comments, which is surely not unreasonable, as is borne out by the fact that the staff at the SIAE were able to put together such a comprehensive response as the one they sent to us within one month.

I should make it clear that the consultation paper proposes reductions in funding of research on engineering, but it should not be taken as implying that there will be a cessation of research in engineering in Scotland. We fully accept that agricultural engineering has an important role to play in improving the efficiency of farming practice, and we intend to maintain an engineering capability in Scotland. But the scale of the effort must be assessed in relation to the competing claims on our scarce resources. Other areas of work will have to be covered to meet the required targets. It is essential that the Department concentrates its funding within engineering and other areas on the most productive research opportunities.

I refer now to the developing relationship between the agricultural engineering industry and the Government. The commitment of Government to support the industry has been clearly demonstrated by the creation in 1984 of the agricultural machinery partnership. This is a new initiative aimed at creating—

The Question having been proposed after Ten o'clock and the debate having continued for half an hour, MR. DEPUTY SPEAKER adjourned the House without Question put, pursuant to the Standing Order.

Adjourned at ten minutes past Twelve o'clock.