§ Mr. William Hague (Richmond, Yorks)I beg to move,
That this House congratulates the British farming community on its achievement of producing two thirds of the country's total food requirements compared to less than half thirty years ago and on becoming a major export industry; recognizes the vital contribution made by agriculture to maintaining the countryside as an attractive environment, particularly in upland areas where there are few alternatives to livestock farming on marginal land; welcomes the determination of Her Majesty's Government to secure fair competition in agricultural products in the European Community; and calls upon the Government to secure a major devaluation of the Green Pound as a prelude to the total abandonment of green currencies by 1992 at the latest, and to continue to seek ways of encouraging good practice in both conservation and business management by the farming community without imposing additional burdens upon it.The purpose of the motion, which I have great pleasure in moving, and of the debate, which I have great pleasure in initiating, is, as the Order Paper states,To call attention to the role of agriculture in sustaining the economic and social health of the nation".It is worth doing that because for many people agriculture and agricultural policy is a very murky and mysterious matter. However, agriculture is of unique importance in this country as it covers more than 80 per cent. of the land area and produces one of our basic requirements—food.It is worth reviewing the success of agriculture and its problems although they have often been referred to in the House. It is worth hon. Members showing that they appreciate the need to assist actively the work of people in the farming community and that we understand the close connection between agriculture and the health of the rural economy and our natural environment.
At the time of the second world war, the health of agriculture was dramatically different from today. At that time people had to endure great sacrifices to import more than half the food needs of this country. Our farmers could produce less than half our total food requirements. There is now a different attitude among subsequent generations. We have been able to take food production for granted. At that time, people appreciated much more where food came from and how it arrived on their table.
I am pleased to say that today, our agriculture produces about two thirds of all our food and about 80 per cent. of all the food that could be produced in our climate. That change has come about despite a fall in the work force of two thirds and a fall in the area under cultivation. It is the result of milk yields increasing twice over and wheat yields increasing by two and a half times, and of productivity improvements that would be the envy of many other industries. Even in comparison with the late 1970s, the average employee in agriculture produces 70 per cent. more now than he did then.
Agriculture has been a tremendous business success, which adds thousands of millions of pounds each year to our balance of payments. It also helps many other sectors of the economy. People actively employed in agriculture spend £5,000 million a year on other services, capital equipment and other inputs. It is a tremendously important industry not only for those who work directly in it but for those who supply it and for those who use its products, for example, in the food processing industry.
We should appreciate that success, but we should also appreciate that the importance of agriculture goes beyond 852 economics. It involves such a large proportion of the land area that the countryside of Britain is a byproduct of agriculture. Some people have the notion that agriculture is the enemy of the countryside, that visitors to the country must have rights to walk where they wish and to do whatever they wish and that the farmer is an unnecessary intrusion. We need to dispel that image and we must blow the trumpet of the farmer, showing him as the friend of conservation and the countryside, because that is the true image. Some 2,000 new farm ponds are created every year and 650 farmers are engaged in the farm woodlands scheme. Many farmers are involved in planting trees and taking conservation measures of their own accord. The environmentally sensitive areas have been a huge success, respected by visitors, farmers and local residents alike. There are other management agreements and sites of special scientific interest.
Some policies have not been wholly successful. For example, set-aside has not been a public relations success for the Government, the farming community or anyone else. Local residents in any area near to agricultural production complain about what has happened when fields have been turned over to set-aside. That does us no good and that policy must be rethought.
If agriculture has been so successful, why has it so many problems? Many people leave the land and the incomes of some hill farmers whom I have visited in my constituency in Swaledale are some of the lowest for 27 years. Investment in agriculture and agricultural equipment has fallen dramatically—by about 28 per cent. in the past five years. It is now at its lowest level in real terms since the war.
There are two reasons for the problems facing agriculture. First, it is a victim of its own success, and that of agriculture in other countries, in producing so much food. Secondly, European Community agricultural policy is, more often than not, weighted against the British farmer. Politicans cannot put right the first problem—farmers have been able to increase food production faster than population growth. There is the added complication that huge areas of the United States are not cultivated but could be. There is tremendous agricultural potential in the east as the economies of eastern Europe become revitalised. It is a sobering thought that the odds are that there will be more than a plentiful supply of foodstuffs for a long time to come.
We can help to ensure, however, that our agriculture industry has a fair chance to compete in the European Community. The farming community has the misfortune of being more dependent upon political decisions than any other industry in private ownership.
Agricultural policy is a mystery to many because there are so many subsidies, premiums, artificial exchange rates, grants, compensatory allowances, and payments for doing specific things as well as payments for not doing specific things, all of which are apparently designed to give special protection to the farmer. From that has come the idea that farmers are feather-bedded. The grants and the rest were introduced not to give special favours to farmers, but because, in many countries, agriculture is the most heavily protected industry. Japan surpasses itself in agricultural protection, even judged by its own protectionist standards. Every year the United States spends billions of dollars on agricultural subsidies and protection. Ferocious battles take place in the EC between countries seeking protection for their agriculture industry.
853 The British farmer would like nothing more than a free market in which he could take his risk like any other business man. He does not want to be shielded from the market sometimes, then thrust into it. He does not want that market to operate in a distorted manner, nor does he always want to be involved in bueaucracy and the form-filling that goes with the subsidies, premiums, grants and so on. Many farmers have turned into office workers, which is not what they wanted. Political decisions hold great sway over agriculture and we must recognise that. I know that the Minister appreciates that.
Agriculture in Europe is fundamentally different from farming in this country—many European farms are smaller and more people are involved. Any misfortune that befalls agriculture in such countries has, arguably, an even greater economic and political impact than here. It is not surprising that such countries seek to defend their agricultural interests at every opportunity. It is not surprising that the United Kingdom had to take the lead in the reform of the common agricultural policy, which threatened to establish surpluses that would have done no good to the farmer, the consumer, or the taxpayer in any country in the long run.
In the time that I have been in the House I have been delighted at Ministers taking the lead or successfully negotiating on many agricultural matters. They have successfully negotiated improvements in the headage limits of beef premiums, from 75 to 90 animals and the headage limits of ewe premiums. Last year Ministers successfully negotiated a price settlement, until currency movements spoilt it. They have successfully delayed changes to the funding of hill livestock compensatory allowances and they have made important departures from it for the future.
Ministers have also successfully negotiated on milk quotas, which will be welcomed by the farming community. Other welcome decisions not necessarily related to the European Community have also been reached. They include the retention of the Potato Marketing Board, the permitted continued sale of green top milk, the increase in the suckler cow premium, the full compensation given because of bovine spongiform encephalopathy, as well as the increases in HLCAs. Ministers must be congratulated on their efforts in the past year to help the farming community through such difficult times.
Sometimes problems arise as a result of delays in the payment of some of the allowances and compensations. Sometimes the good will and good results produced by increasing the amounts to be paid out are sacrificed when that money does not get to the farmer in time. Last year in my constitutency there were serious delays in the Northallerton office of the Ministry of Agriculture, Fisheries and Food when it was processing the payment of HLCAs. This year I have been told of continuing delays. I am sure that the staff of that office are doing their best, but that office and other MAFF offices throughout the country must be properly staffed if they are to carry out Government and EC policy and make payments on time.
The Government should blow their own trumpet about some of the things that they have done, as they have been extremely tough in many European negotiations. My hon. Friend the Parliamentary Secretary to the Ministry of Agriculture, Fisheries and Food will know that, now, the principal grievance of the farming community is the green 854 currencies and the unfair competition that the British farmer faces because of the current valuation of the green pound.
Because of shortage of time, I shall not detail the tremendous discrepancies between the amount of money received by British farmers and that received by farmers on the continent across a whole range of agricultural products. Obviously, if the British farmer receives £20 less per tonne of wheat than the German farmer, it creates a serious problem that needs to be rectified. It is equivalent to a loss of income of £800 million a year from the British agriculture industry.
I hope that my right hon. and hon. Friends will do their best to put the case for the British farming community in all forthcoming negotiations. The eventual answer is British entry to the exchange rate mechanism of the European monetary system and the abolition of green currency rates. Let us hope that both will happen by the end of 1992, if not before. In the meantime, Ministers must make great efforts—and if they do, they will deserve the gratitude and support of the farming community.
The motion calls on the Government
to continue to seek ways of encouraging good practice in both conservation and business management.The new system of conservation grants is most welcome and any scope to extend the environmentally sensitive areas would also be welcome. Perhaps the Ministry and the Department of the Environment should further consider how to ensure that national parks and the farming community work successfully together. Nowhere is it more important to keep people on the land than in the national parks. Both my hon. Friend the Minister and I represent the Yorkshire dales. They would look very different without the fields grazed and the walls kept in good repair. That is why the HLCA payments are important. It is also why improved payments for some conservation projects in particular areas would give good value for money. It requires sensitive planning policies. It is not easy for the next generation of the farming community to find anywhere to live. They are an important part of the rural housing problem that I have previously brought to the attention of the House. They are the heart of the rural economy and the rural environment. Some of the national parks are, sometimes, rather heavy-handed in dealing with planning applications by farmers that would allow their businesses to continue for future generations. I hope that that will be kept under careful review.If there is time, I hope that my hon. Friend will comment on nitrate-sensitive areas and on what has happened to the European Commission proposals on nitrates. When we debated them in the House, they appeared to be rather ill-informed and even alarming in what they would mean to agriculture in Britain if they were ever implemented.
The motion calls for good business management, which on the individual farm, is a matter for the farmer. It also means good management of the marketing and distribution of agricultural products. There have been some ill-informed attempts recently to call for the abolition of marketing boards. I hope that we reject those calls. There has also been discussion about the future of the Milk Marketing Board. I hope that it is secure as it is doing a great deal to adopt more market mechanisms in its operation. I hope that my right hon. and hon. Friends will resist, wherever possible, placing more bureaucratic or 855 unnecessary financial burdens on the industry. Forthcoming regulations from the Department of the Environment on silage, slurry and fuel oil storage are causing concern. Not much time has been given for thorough consultation, let alone for assessing the full financial consequences of the proposal. A great deal of digging up and reconstruction of farmyards could result, so I hope that the regulations will be more fully examined before they become law.
I hope that Ministers will continue to emphasise how much we believe in agriculture. My right hon. Friend the Minister's speech to the annual general meeting of the National Farmers Union was most welcome. Agriculture does not always get a great deal of support from other public spokesmen and in the hysteria about bovine spongiform encephalopathy that we have seen in the past few months Ministers should be congratulated on having kept calm. I cannot congratulate the BBC because whenever possible it has insisted on showing library footage of a cow against other footage of Northallerton market in my constituency. That footage of a beast with BSE has appeared hundreds of times and given the impression that BSE is to be found passing through Northallerton market. There is no evidence that such an animal has been through that market, but that footage has now appeared on the BBC more often than Terry Wogan and it is time to stop showing it. I hope that the BBC will take note of that.
I hope that there will be time for the Minister and other hon. Members to respond. I have tried to demonstrate the importance of agriculture to our national and our rural economies. I have also shown the success that it has enjoyed and the problems that it now experiences. I have pleasure in presenting the motion to the House.
Mr. Elliot Morely (Glanford and Scunthorpe)I congratulate the hon. Member for Richmond, Yorks (Mr. Hague) on bringing such an important issue before the House. I am sorry that because of the way things have worked out, the debate has been squeezed to the back end of today's business. Agriculture is worthy of a detailed debate on it role and its relationship to society and our countryside communities.
The Agriculture Act 1947, which was passed by a Labour Government, forms the basis for agricultural support. It is a tribute to Tom Williams and the Labour Government of that time that the Act has been maintained almost unchanged as a means of giving support within a framework that ensures efficient food production and prevents a return to the events of the 1930s when many people were driven from the land.
There is no doubt that our farmers are suffering heavily as a result of the green pound. I add my voice to those who have urged on the Government in their negotiations on the matter in the EEC. They should try to abolish the system now or make it much fairer to our farmers before it is eventually abolished in 1991.
Another issue that worries farmers is high interest rates. The Goverment have only partial powers in terms of the green pound because they must deal with the matter in EEC negotiations. However, interest rates are certainly wholly within the powers of the Government and they 856 could take far more successful steps to deal with them. High right are crippling farmers and many other business people, quite apart from people who have mortgages or high-interest loans.
§ Mr. Edward Leigh (Gainsborough and Horncastle)I am sure that the hon. Gentleman would want farmers to be confident about the future. Will he comment on the Labour party policy review which states that Labour would
negotiate with our … partners a price support system, based on lower guaranteed prices for limited levels of production".That two-price system was condemned when it was produced by the leader of the SDP in the last Parliament as a disaster for British agriculture. I am sorry that not a single member of the SLD has bothered to turn up today. Will the hon. Gentleman give the commitment that if a Labour Government are elected they will not introduce a two-tier price structure? Would Labour tax or nationalise agricultural land? If the hon. Gentleman can reply to those questions I am sure that that would considerably help the debate.
§ Mr. MorleyThose points are worthy of serious debate, but I very much regret that in the time remaining, during which the Minister has to reply to the debate, I shall not have time to deal with all of them. However, I shall touch briefly on our alternatives.
Some farmers have been responsible for the problems that have worried rural communities. Pollution, silage run-off, pesticides and the use of aerial sprays, especially in lowland areas, have caused problems. As trustees of the countryside, farmers have a responsibility to ensure that our landscape and habitats are protected. They should also ensure that there is reasonable access to rights of way and that public rights of way are maintained and not blocked. A minority of farmers have not given their full attention to those factors, and it is because of the actions of a minority that the ban on straw burning has been introduced. I must stress that the minority of farmers behave like that.
I recently had the privilege of addressing the annual dinner of the Winterton Agricultural Society, which is very much influenced by local farmers and landowners. For over 120 years, it has put on an annual agricultural show and played its full role within the community. It has fostered a community spirit, and played an active role in ensuring the stability and well-being of rural communities. That must not be underestimated.
There is great concern in the farming community about the change in the role of the Agricultural Development Advisory Service and the fact that it is becoming more a financial, money-making concern than a support system for the farming community. I contrast that with the role of the Department of Trade and Industry, which offers small businesses all kinds of financial help and inducements. Farmers are small business people and they deserve the same kind of backing for their businesses. ADAS, in the way that it is changing, is not fulfilling that need.
I am also concerned about the cuts in research and development in this country, while our European rivals are extending their research and development ready for 1992 and the open market. It is vital that our farmers are not put at a disadvantage compared with their European rivals in the open market. We must maintain our level of research and development to give our farmers the backing and 857 technical support that they need. All too often the definition of near-market research means that the research is ended and no one else steps in to pick it up.
When we are in Government, we shall introduce various changes—and we shall see a Labour Government in the not-too-distant future. We shall impose green premiums to give support for farmers for the points that the hon. Member for Richmond mentioned, such as encouraging environmentally friendly farming. Environmentally friendly farming will mean a reduction in output, and we should recognise that in terms of support. We also want an extension of the environmentally sensitive areas, which we supported and which we believe are very successful.
The approach to farming must be planned and strategic, taking into account the needs of the people who work in farming, including farm workers, the local community, the role of farmers and their effect on the environment, and the importance of maintaining food quality standards. We should set up an independent body to ensure that food quality standards are maintained. We should recognise that in the rural community, there are related problems with public transport and housing. We should tackle that in integrated and supportive ways. From my experience, I see that there has been a shift in the farming community and rural communities. They recognise that the Labour party has increasingly relevant policies to their needs, and we are increasingly attracting more active support to our cause and our campaigns.
§ The Parliamentary Secretary to the Ministry of Agriculture, Fisheries and Food (Mr. David Curry)I congratulate my hon. Friend the Member for Richmond, Yorks. (Mr. Hague) on choosing this subject and on the particular eloquence of his advocacy. I should expect nothing less of my hon. Friend who represents such a beautiful part of north Yorkshire. His constituency is, if I may say so, surpassed in beauty only by the neighbouring constituency somewhat to its west which is, of course, the one that I represent.
My hon. Friend was perfectly right to say that agriculture is now part of an international industry and that our decision-making at national Government or local level must be put in the context of the European Community which sets the overall framework for our policies. More than 90 per cent. of the expenditure for my Ministry is determined by European regulations, so the margin for purely autonomous decision-making at home is small. Our policy is also determined increasingly within international negotiations in the context of the general agreement on tariffs and trade. The great event which is upon us and which should be settled by the end of the year is the next round of the GATT negotiations.
All the developed countries with agriculture industries are concerned about the economic cost of agriculture to the rest of the economy. Only by means of a kind of international disarmament will the cost of agriculture be sustainable. We must ensure that competition takes place on a reasonably fair battleground.
The Government do their utmost within that context to help agriculture. We recognise that agriculture cannot be divorced from general economic circumstances. No farmer whom I have ever met has asked for special status for agriculture so as to insulate him from the economic forces 858 that affect many other members of the community. We can provide assistance. My hon. Friend the Member for Richmond referred to the suckler cow premium, which was increased just under a year ago. We have announced an increase in the compensatory allowances for the uplands which, in both my hon. Friend's constituency and mine, cover large areas; 50 per cent. of the community live in less-favoured areas. Those allowances are important to farmers who will never be large, rich, agricultural barons. However, they have an enormously important conservation role to fulfil.
We were able to secure improvements in compensation for bovine spongiform encephalopathy. I support what my hon. Friend said about the poor cow that is continually used on television to illustrate BSE. As he said, the same cow appears repeatedly, slipping on the same patch of ground and giving the impression that BSE is a doleful matter. It is not cruel, inasmuch as the animals are then dealt with. That film gives the wrong impression. I hope that it will be changed. We have also increased the compensation for salmonella cases.
There are areas where, in the interests of public safety and in the interests of the farmers themselves, tough action must be taken. That will be difficult for farmers. However, when we can take action to mitigate the effects, we do so.
My hon. Friend referred to the farm and conservation grants. They have been given a greener aspect over the past few years, and we shall continue to move in that direction. We are encouraging the preservation of stone walls, and similar measures. The grants that have been made available for diversification have also been taken up and have led to success, but no one should exaggerate their importance. I have noticed, nevertheless, that the number of fishponds has increased. A farmer who lives not far from me has introduced some fishponds on his land. He is doing so well out of what he charges for fishing in his ponds that next year, I am told, he plans to put fish in them.
A number of schemes are to be introduced soon. A pilot extensification scheme will be introduced shortly. That will be a green scheme, as well as a scheme to aid agriculture. The proposals to encourage organic agriculture will be announced soon. The environmentally sensitive area schemes will be reviewed next year. We shall have to consider whether to extend them and whether we are getting the best value for money out of them. The obligations are relatively light. In some cases there is a good reason for that. In my constituency, right at the top of the Pennines, increased access could have a deleterious effect on peat moor landscapes where paths can create problems.
The nitrate pilot scheme will shortly be unveiled. Negotiations are taking place in Brussels, because we still have reservations about it. My right hon. Friend the Minister of Agriculture, Fisheries and Food was in Paris recently seeking French support in respect of the Community demand that there should be exclusive reliance on agriculture to deal with the nitrate problem. That is the dirigiste approach. We hope to modify those proposals, although the Department of the Environment takes the lead in those negotiations.
We realise that the question of the green pound is important. I ask the agricultural community not to make it into too much of a totem. If the green pound were to be devalued by 5 per cent. between now and tomorrow, would the farmer be materially affected? Conversely, if the 859 green pound were to be revalued over 24 hours, would the farmer be all that much better off? We must keep it in perspective. However, we recognise that the price differential penalises the British farmer.
We intend to press for a significant devaluation. We have devoted a great deal of time to discussing with our colleagues how important it is that the green pound should be devalued. We have explained the handicaps. We have pointed out that devaluation would not give British agriculture an advantage but that it would help it partly to recover from the disadvantage from which it suffers at the moment. That is the cardinal element in the farm price negotiations which will begin in earnest in about 10 days' time at what will probably turn out to be a marathon session in Luxembourg.
I strongly subscribe to my hon. Friend's views on planning and the national parks. We share the Yorkshire dales national park, and I have great respect for the work being done there. Nevertheless, people want to live in the area, and we want an active and vigorous local community with opportunities for tradesmen and small businesses. We want a diversified economy. The landscape, after all, will be protected if normal economic life proceeds in harmony with nature; we do not want to turn the place into a museum piece. That is why we give the uplands the grants without which they would not survive. We are supporting local communities, and I believe that our policies are right and should be pursued.
§ It being half-past Two o'clock, the debate stood adjourned.