HC Deb 09 May 2001 vol 368 cc222-39 10.20 pm
Mr. Damian Green (Ashford)

I beg to move amendment No. 2, in page 3, line 3, leave out "food".

Mr. Speaker

With this it will be convenient to discuss the following amendments: No. 3, in page 3, line 6, leave out "food".

No. 4, in page 3, line 7, leave out from "consisting" to end of line 20 and insert—

'of the provision of essential goods or services to the community in which it is located, such goods or services to be prescribed by the Secretary of State by order'. No. 5, in title, line 3, leave out "food".

Mr. Green

The purpose of the amendments is consistent with the aim of the Opposition throughout the proceedings on the Bill, which has been to improve it. The hon. Member for Rhondda (Mr. Rogers) who, sadly, is no longer in his place, and who has not taken part in any of the previous debates on the Bill, was wrong to say that the Conservative party was seeking to delay the Bill. We have said that we support it in principle. We did not oppose it on Second Reading. We have discussed the efficacy of the Committee stage. Nothing could be more inaccurate than the statement that the Opposition were trying to delay the progress of the Bill.

At every stage through which the House has passed extremely quickly this week, we have consistently sought to improve the Bill. Earlier we heard an interesting debate about whether the Bill was modest or important or both. The truth is that it is both. It is important that some relief goes to businesses, whether farm diversification businesses or village shops, that are suffering as never before under the Government's policies. Equally, it is apparent, not just to those of us on the Opposition Benches, but to the many organisations that represent the bodies that will benefit from the small help given by the Bill, that it goes nothing like far enough. The amendments seek to do what we have sought to do at every stage of the Bill: to give it teeth and to add to the generosity of the benefits that will be given to businesses under the Bill.

Mr. Dale Campbell-Savours (Workington)

How much?

Mr. Green

The hon. Gentleman, too, has not taken part in any of the previous debates on the Bill. If he will contain himself, he will see what benefits would accrue from the amendments.

Mr. Michael Jack (Fylde)

I am grateful to my hon. Friend for giving way. Does he believe that he was right to use the word "generosity"? Would not the word "necessity" have been more appropriate?

Mr. Green

I was trying, as ever, with generosity of spirit to be kind to the Government. They may think that they are being generous to the rural businesses that are suffering so much, but of course that is not the case. They have introduced this rather inadequate Bill and, as we heard, there was a huge delay between First and Second Reading, which is why we are having to go through the various stages of the Bill with indecent haste.

Mr. Campbell-Savours

How much?

Mr. Green

The amendments are designed to improve clause 3 by making it less restrictive. Throughout our proceedings on the Bill, we have tried to improve the parts relating to farm businesses that wish to diversify, and we have tried to extend the Government's restrictive definition of the village shops that will benefit from the small amount of rate relief.

Mr. Campbell-Savours

How much?

Mr. Green

The hon. Gentleman keeps shouting, "How much?" from a sedentary position. If he bothered to read the amendments, he would realise that I am seeking to extend the number and type of shops that would benefit. I am sure that, with his characteristic diligence, he has read the notes from the Library. The Government's proposals entail advantage to the various businesses of £16 million over five years. As my hon. Friend the Member for North Wiltshire (Mr. Gray) has already observed, that adds up to just over £3 million a year. I am sure that the hon. Member for Workington has assiduously read the Hansard of the Second Reading debate, so he will know that the Government's agencies for the countryside say that the tourism industry alone has lost something like £2 billion during the foot and mouth crisis. Indeed, his own constituents have suffered as much as anyone during this dreadful outbreak.

The amendment would remove the unnecessary restrictions imposed by the Government on the type of village store that can receive this modest rate relief. The essential purpose of all four amendments is to widen the definition of "a qualifying food store." Under clause 3, the only stores that can benefit from the rate relief provided in this Bill and in the Local Government Finance Act 1988 which it amends are narrowly defined food stores. The Government have explained why they believe the definition should be so narrow and confined to a store that is "wholly or mainly" involved in selling food. I genuinely believe that they are being unnecessarily restrictive. Without the amendments, the ultimate purpose of the Bill will be partially negated.

It is not a matter of controversy across the House that the underlying point of the Bill and the legislation that it amends, which was passed by the previous Conservative Government, is to help those shops that provide an essential service to village communities, as far too many village shops and services have closed. Successive Governments have sought ways to mitigate the many problems that face such stores, and to find practical solutions that will enable them to carry on in business.

With the amendments, I want to draw back the veil that the Government have placed over this issue. They define these essential services as predominantly food shops. They have said that the underlying purpose of the Bill is to ensure that all the essential services that contribute towards a decent, coherent, civilised society should be as available to those who live in small, rural communities as they are to those who live in large, urban communities. That is a wholly admirable aim. My complaint about the Bill and the reason for these amendments is that, as currently drafted, the Government's definition of a shop does not serve that admirable aim.

The Minister and his right hon. Friend the Minister for Local Government and the Regions have said that they want to avoid loopholes and to prevent shops from slipping in at the edge. They rejected previous amendments in which we sought to replace the word "mainly" with "in part". The Government regarded as ineligible a food shop with 40 per cent. of its turnover from food sales, because they thought that that would be exploiting a loophole.

On Second Reading, and in Committee, the Government made it clear that, for reasons which escape me, they have a particular horror of antique shops being included in the definition. It is clear that either the Minister or his right hon. Friend has had a bad experience in an antique shop, because they have a wholly unjustified dislike of them. Regardless of their slightly odd personal prejudices, that is not an adequate basis for policy making by a responsible Government. Much of clause 3 is a characteristically ingenious attempt to plug the various loopholes that the Government say they are extremely anxious to avoid. In Committee, both we and the hon. Member for Weston-super-Mare (Mr. Cotter) pointed out that a large part of clause 3 was devoted to preventing a shop from installing a microwave oven in which people could heat up meat pies. It seemed to De that, without my amendments, clause 3 was almost more designed to be restrictive than to be permissive. That struck me as being the wrong emphasis in a Bill that sought to help businesses.

Mr. James Gray (North Wiltshire)

Does not one of the most peculiar aspects of the clause feature in the proposed new subsection (6CA) in subsection (3)? Line 8 contains the words "excluding confectionery". If there were two sweet shop[...] in the same village, they would not be able to claim rate relief. That strikes me as bizarre, but in villages such as Lacock in my constituency it might well happen.

Mr. Green

My hon. Friend has drawn attention to a point raised in another of our Committee debates. As he knows, we engaged in an extensive discussion about why the Government were so anxious to exclude any shop with a microwave oven that could heat up meat pies. We also discussed whether the exclusion of confectionery shops was in any way sensible. The definition of confectionery is not available—I have looked at the original legislation, and it is not there—so the Government will be excluding some shops that may well provide essential services in villages.

I think the Government will regret their action. I think that, if they leave the Bill as it stands, they will not receive even the meagre credit that they perhaps deserve for finally introducing the Bill. There will be villages in which the shop that people regard as their essential store—the shop that they want to keep open, and consider to be a valuable part-of village life—cannot stay open, precisely because of the unnecessary restrictions that the Government have included in various parts of clause 3. Those people will say "Hang on: didn't this Government pass legislation that was supposed to help village stores by allowing them rate relief? Now we find that our village store does not qualify." I cannot believe that that is one of the Minister's purposes; I am sure that he wants the Bill to be as wide-ranging as possible.

The amendments seek to help the Minister achieve what I imagine to be his aim by sweeping away the loopholes—and the restrictions—that the Government have, with unnecessary ingenuity, sought to introduce. They remove the restrictive definition, of a food store, and redefine an essential shop, in ways that I shall discuss later. In fact, they serve various purposes. First, and perhaps most important, they are deregulatory. I am sure that those running small village shops and suffering an ever-increasing burden of red tape would welcome a deregulatory alteration in the Bill. Perhaps even more relevant, however, is amendment No. 4, which seeks to be forward-looking in the definition of an essential service.

At present, the Government are stuck in an unfortunate backward-looking mindset. According to clause 3, the only essential village shop is a food shop. No doubt historically food was ultimately the one thing that people looked for in village shops, but, as the Minister will know, what can be provided in local shops, and what needs to be provided as a local service, is changing more rapidly than ever before. My amendments seek to enable the Government to modernise. I use that word deliberately to entice the Minister.

The Minister will know as well as I do that food is an essential service. No one would deny that quality of life in any village is enormously improved by the existence of a food store, but there are many other essential services. In the House and outside, we have had many intense discussions about benefit payments, particularly through electronic means, and how to preserve village post offices. Other members of the Government are, rightly, deeply concerned that those who may not be well enough off to afford a computer, or who may not have easy access to a large town where there are internet cafés or libraries, should have internet access. Those are examples of services that will be as essential as the provision of food. The full range of civilising opportunities that are available to those who live in urban areas should be available to those who live in rural areas. That is at the heart of amendment No. 4.

Of course, that small list cannot be regarded as exhaustive because, in the years ahead, other services will be regarded as being essential to preserving commercial activities in a village. The chief merit of amendment No. 4 is that it does not seek to be prescriptive—to lay down what is an essential service in village shop. It says that a shop will be eligible if it provides

essential goods or services to the community in which it is located, such goods or services to be prescribed by the Secretary of State by order". The framing of the amendment is deliberate. It is flexible enough to accommodate changing and developing priorities as time goes on. It has been drafted in that way to allow the next Government, who will be elected shortly, the freedom to help to keep a village shop that is offering whatever are the essential services of the day going.

In the past 10 years, all hon. Members have seen enough changes in retailing and enough expansion in the services that we regard as essential to know that it is foolish for the House to set down what those essential services will be. If we have the opportunity to introduce flexibility in legislation, it is sensible to do so. That is why I believe that the amendments that Mr. Speaker has kindly selected improve the Bill.

None of us can know what is the key to keeping people spending money in small rural communities. I make no apology for returning to that point because we are seeking to maintain a commercial infrastructure in small rural communities. We do not know what people in those communities will want to spend money on in future. With the amendment, we do not need to. The House can afford a modest level of extra protection to those village shops without attempting to second-guess the future.

Throughout the stages of the Bill, which has been rushed through so expeditiously, we have attempted to make it more generous. This is the last group of the amendments that the House will discuss. I very much regret that the Government have rejected all our previous suggested improvements, albeit with one or two hints from the Minister that they will consider some of our exceptionally sensible suggestions. Nevertheless, despite the Government's consistent rejection of our proposals, Opposition Members are generous at heart and will continue to rehearse the arguments about how the House can make better laws—a skill that we shall soon be practising full-time.

In that spirit, I commend the amendment to the Minister and the House.

Mr. Gray

I commend my hon. Friend the Member for Ashford (Mr. Green) on such a comprehensive review of the necessity for the amendments, especially as, from the sound of his voice, he seemed to be suffering just a bit towards the end of his remarks. To carry on in those circumstances seems to be noble beyond the call of duty, and I congratulate him.

I am glad that the amendments in this group have been selected because they go to the heart of what is wrong with the Bill. I do not say that in an unfriendly or ungracious manner. Although the Bill is, as we have said on many occasions, a small and inadequate measure compared with the size of the problem currently facing rural areas, hon. Members representing rural constituencies such as mine very much support the broad thrust of its objectives. Therefore, when I attack the Bill, I do not mean it in an ungenerous sense. I make it plain that we support its broad thrust.

Including the word "food" in clause 3, which deals with village shops and stores, cuts the heart out of what could otherwise be very useful provisions. We are talking about rural villages with fewer than 3,000 people but with more than one non-food store. I thought that, in considering amendment No. 2, it might be useful to consider some precise case studies which I conducted recently in my constituency in the aftermath of the foot and mouth crisis.

My constituency has three or four largeish towns, but about 60 villages that are precisely like those described in the Bill and which have been very severely affected by the crisis. [Interruption.] I am sure that the hon. Member for Northampton, North (Ms Keeble) knows the Cotswolds and perhaps even those 60 villages very well from her time at Cheltenham Ladies college. Then again, perhaps Cheltenham Ladies college does not give its students sufficient away days to discover the area. It is a very expensive boarding school and may keep its students in all the time. However, if she had gone for a little trip down the road to my constituency, she would easily have discovered that we have 60 villages across the constituency. However, she must forgive me. If she had not sedentarily doubted my word in that way, I would not have raised the politically embarrassing background that she constantly tries to live down.

As I said, we have 60 villages across my constituency, and they are precisely the type of place that has been affected by the foot and mouth crisis in tourism, especially because of the cancellation of Badminton and all the rest of it. They are precisely the types of places that would benefit from the Bill's provisions.

Immediately after the crisis began, I went round to those villages, taking with me 2,000 copies of a survey asking them exactly how bad they had fared in the aftermath of the foot and mouth crisis. I dished out the survey to pubs, cafes, garages and tourist shops in villages such as Castle Combe, which hon. Members may remember is the very famous village where they filmed "Dr. Doolittle", and Lacock, which is a very picturesque village. They are small villages with only two or three shops, some of which admittedly are antique shops. I have already heard from my hon. Friend the Member for Ashford that the Government seem to have it in a bit for antique shops.

Although some of the shops sell antiques, most tend primarily to be a combination of the small tourist shop and the classic village shop. Confectionery is very important in that context, as people who go to Lacock, Castle Combe and Corsham like ice creams, for example. I should be interested to hear from the Minister whether ice cream is included in his definition of the word confectionery, which is excluded from the Bill. It seems sad to me that those confectionery shops, into which the tourists flock in Lacock to get their ice creams and sweeties to eat, will be excluded. If the village shop has the temerity to have a microwave to heat up the Cornish pasties so beloved of the tourists, it will be excluded, and that seems wrong to me.

10.45 pm

Before we move on to the detail of the amendments, I shall share with the House the early results of my survey. So far I have only had 200 or 300 returned, but they are from exactly the sort of businesses that we are talking about. The people who replied say that year on year, their income has declined. In four consecutive weeks, first two, then another two, then four, then six, said that their income had declined by 100 per cent. compared with this time last year. Out of perhaps 100 returns so far, the income of about 10 per cent. of the shops had declined by 100 per cent. Others declare varying rates of decline.

A few comments from the survey might be useful. For example, Mr. and Mrs. Pask from the County Stores wrote:

Reduction on rates would help". Mr. Poole of the Wilts Printing Works wrote:

Reduced wages for all employees. Closure possible". Mrs. Tubb, of Tubbjoys Antiques in Wootton Bassett—I am sorry to be awkward by bringing an antique shop into the debate—wrote:

Cut back hours … Lost one member of staff and Mr. Ivory of the Old Dairy Saddlery in Tockenham wrote that he had laid off two people already. Kate Short, of the Blue Door Art Gallery—art galleries would not be covered, either—wrote:

Virtually no tourists; no American visitors. The Easter week was particularly terrible. Richard Bridge described

Severe cash flow problems … a threat to the survival of the business. Those are a small sample of many such comments from all over the constituency. I shall ensure that the Minister has sight of the full results of the survey if he is interested, when I have them all in and have collated them. I fear that that may be after the election—so it may well be my hon. Friend the Member for Ashford to whom I will send those results, rather than the present Minister.

The exercise was a fascinating survey of precisely the kind of businesses that would benefit from the Bill. Specifically excluding stores other than food stores rips the whole heart out of the Bill. I am talking about sweet shops and antique shops of all kinds. People drop in and buy a few things, such as a present to take home with them. That sort of purchase is essential in places such as Wootton Bassett, Chippenham, Corsham and Lacock. People pass by, go and see the local tourist site, and then drop into a shop to buy something. That sort of purchase is essential to the people who are really suffering.

Those people were suffering even before the foot and mouth crisis, partly because of the cost of living in that part of the world. Now they are suffering terribly. We are not seeing the Americans, or the other passing tourists. The three big horse events in the area—the Badminton horse trials, which 250,000 people attend every year, the Cheltenham festival, and the Bath and West show—have all been cancelled. Hundreds of thousands of people who would normally have come into my area at about this time of year are not there. The little shops are suffering as a result.

That is why I welcomed the general thrust and purpose of the Bill, and liked the sound of its title when I first heard about it. It is only when one looks at it in more detail—it is a shame that we had less time than we should have had to consider it in Committee yesterday—that one finds that it excludes anything that is not a qualifying food store, and anything that sells confectionery or supplies food in the course of catering. Those seem to me major exceptions that wreck what would otherwise be a perfectly sensible Bill.

The Bill will go to the other place for further consideration tomorrow, and I know that many of the Members there will have stores such as those that I have described very much in mind. I therefore hope that by the time the Bill gets there tomorrow, the Minister will have listened carefully to those considerations and will think carefully about the amendments that my hon. Friends have tabled to clause 3. I hope that he will bear in mind the fact that the proposals in the consultation paper were made before foot and mouth, and although they may well have been reasonable at that time, things were not as bad in those days as they are now.

In the light of the foot and mouth crisis, and the kind of catastrophe that is affecting businesses such as those that I have described in my constituency, I hope that—late as the hour is tonight, and early as it will be tomorrow in the other place—the Minister may yet consider expanding the terms of the Bill so that all the businesses that have been so badly affected by the foot and mouth crisis can be helped by the provision as of this otherwise perfectly reasonable Bill.

Mr. Brian Cotter (Weston-super-Mare)

I also support the important amendments tabled by he hon. Member for Ashford (Mr. Green). It is difficult, in the light of the crisis in the countryside, to see why the rate relief assistance should be confined to food shops. The hon. Gentleman asked who are we to decide what sort of business will be important in the future or which areas may require certain types of business to be viable. For example, a small village by a canal may require a shop selling equipment for boating or fishing. Many villages need a chemist or hardware shop, because those goods are not always available in food shops. Information will be important in the future, and villages will require internet centres. Many other services could be vital. Jobs are also important: for example, a local potter or craftsman may wish to sell his products in a small shop in a village.

I hope that the Minister will seriously consider the amendments, because it seems unnecessary—in view of the small amount of relief that will be provided—to confine the relief to food shops. My village has a shop that sells small items of pine furniture and little items of an antique nature, and that is important to people locally and it keeps jobs in the rural community. I especially support amendment No. 4 and look forward to hearing the Minister's comments on it.

The Parliamentary Under-Secretary of State for the Environment, Transport and the Regions (Mr. Robert Ainsworth)

These four amendments concern the definition of food shops, to which the Bill will extend mandatory rate relief. Amendments Nos. 2, 3 and 5 would delete references to "food" in clause 3 and in the title of the Bill. On their own, they would have no practical effect, because a qualifying store would still be defined by reference to the sale of food. However, that would be altered by amendment No. 4, which would replace the definition of a food shop with a new order-making power to allow mandatory relief to any shop providing essential goods and services, as defined by the Secretary of State by order. That would have the effect of making the introduction of the Bill more complicated.

An order would still be required under the new power to extend mandatory relief to food shops other than the sole general store. As for other essential goods and services, mandatory relief can already be extended to them under the existing order-making powers, which we used recently to cover pubs and petrol stations. The hon. Member for Ashford (Mr. Green) said that the purpose of his amendments was to improve the Bill but, as with other amendments he tabled in Committee, they would widen the scope of the proposals. The Bill is not intended to provide rate relief to all small businesses. It is intended as a measure to provide relief for shops providing essential food in small rural villages.

The hon. Member for North Wiltshire (Mr. Gray) said that there were 60 villages in his constituency. For one tantalising moment, I thought that he was going to give an example of one for which the provisions of the Bill would need to be extended. However, he went on to talk about shops serving the tourist trade, and about antique shops and sweet shops. The hon. Member for Weston-super-Mare (Mr. Cotter) spoke about internet services, potters and craft shops.

The Government aim to introduce measures to amend rates for all small businesses, and those matters remain to be discussed. Last year's rural White Paper dealt with the matters covered in the Bill, and commitments were made. The Bill allows us to address problems that we know exist in those small villages where the sole general store gets mandatory rate relief. Councils in rural areas feel obliged to extend concessionary rate relief to other food stores in those villages, and the Bill deals with that. It does not extend to non-essential small businesses, no matter how desirable they are.

If the Opposition believe that the Bill should extend wider, they must say how they would pay for that, given that they are committed to a programme of massive public spending cuts. Moreover, the previous Conservative Government introduced the national non-domestic rates system in 1990. Small businesses in rural communities have experienced crises for a long time, but the previous Government did absolutely nothing to help. They did not introduce a measure along the lines of the Bill, or any measure to deal with the problems encountered by solé general stores, pubs and petrol stations. The Conservatives believe the Bill to be inadequate, so why did they do nothing when they were in government?

Mr. Gray

I shall try to ignore the party political polemic into which the Minister has allowed himself to slip. The previous Government did not act in the way that he suggested for the simple reason that there was no foot and mouth disease outbreak during our period in office.

The Minister said that he thought that I had not mentioned any essential store in the countryside that would not be covered by clause 3. It may sound a little foreign to someone representing Coventry, North-East, but the horse industry is essential in my area. I mentioned Mr. Ivory's saddlery in the village of Tockenham, and I could have spoken about a horse supplier in Malmsbury for whom the cancellation of the various events that I mentioned earlier has caused great difficulty. The closure of paths has meant that no hunting is taking place, so businesses in the horse sector are in severe crisis. The Bill does not help them at all.

Mr. Ainsworth

The hon. Gentleman's prejudices extend far and wide, from my hon. Friend the Member for Northampton, North (Ms Keeble) to Coventry. They know no bounds.

The hon. Gentleman suggests that the only reason that the previous Government did nothing was because they did not have a foot and mouth outbreak. What about the numbers of village schools, post offices and essential village shops that closed when the previous Government were in power, during which time they did nothing?

The Bill is not about foot and mouth. The Government have introduced other measures to deal with the problems of foot and mouth, such as hardship rate relief, deferred rate payments and reductions in rateable value to reflect temporary reductions in property values. This measure seeks to underpin essential services for people living in small rural communities, and I should have thought that it was in the interests of the Opposition to give it their support and allow it to pass through. To do so, they should withdraw these unnecessary amendments.

11 pm

Mr. Green

The Minister's speech was extraordinary. He started by ignoring the fact that everyone on the Conservative and Liberal Democrat Benches thought that this was a sensible group of amendments. As he ploughed through his speech, he realised that that was an unprofitable road to go down, so he went on to say that the Government did not want to accept the amendment because it was not part of the Bill's original intention. That is fair enough. Of course it was not—that is why the Bill needs to be amended and improved. That is the purpose of amendments.

We are not arguing about why it might be better, as the Minister said, to leave the Bill as it was. The Minister simply referred to the original intention of the Bill and to what was promised in the rural White Paper, but he will recognise that circumstances have changed and worsened radically over the past 12 months since the White Paper's publication. A more generous response may be needed now, even if the Government thought, in good faith, that their response was adequate when they published that White Paper. So that argument was not particularly convincing.

Least convincing of all was the early statement in the Minister's speech, which he returned to at the end, about the purpose of clause 3 and about the reliefs being introduced to help shops that provide essential goods or services. Those are precisely the words used in amendment No. 4. I took them from the phrase that the hon. Gentleman and the Minister for Local Government and the Regions used repeatedly on Second Reading and in Committee. They said that the underlying purpose of the rate reliefs proposed in clause 3 was to help preserve the provision of essential goods and services in rural areas. It seemed to me not incompatible with the Government's aims to insert an amendment that would make that explicit, thus making the scope of the Bill's provisions wider and more generous.

Mr. Leigh

Traditional food shops in small villages have had to diversify. They cannot remain in business simply by selling food. We are really talking about gesture politics. How many village shops in rural areas and small villages will the Bill help? It will not provide the means by which village shops can be saved, because they have already had to diversify.

Mr. Green

My hon. Friend makes the powerful point that sensible and forward-looking village shops are already diversifying. The purpose of the amendments is to highlight that future generations of village shops may he very different animals, providing a different range of essential goods and services—to use the phrase that the Minister used several times.

The provision of essential services should be at the root of what we are trying to do. The purpose of the modest amendments is to enable the Government to achieve what they say are their own ends, but clearly they reject that idea. I sensed that, with characteristic honesty, the Minister accepted that his arguments were not going well because he resorted to cheap, party political polemic, which had been notably absent from our discussions of the Bill at every stage. I took it as a compliment on the standard of the arguments that have been made from those on the Opposition Benches that the Minister could not make any points in argument against what Conservative Members and the hon. Member for Weston-super-Mare (Mr. Cotter) have said, and had to resort to party political insults.

I very much regret the tone and content of the Minister's response, but we are seeking to make progress with the Bill, so I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Order for Third Reading read.

11.5 pm

Mr. Robert Ainsworth

I beg to move, That the Bill be now read the Third time.

This is a short but useful Bill. We have had an opportunity to debate its two substantial measures, and the wider issues that they raise, at Second Reading last week, in Committee yesterday, and again today. I am grateful to hon. Members for their co-operation in ensuring the Bill's rapid passage. We all want the benefits that it will bring to rural businesses to be in place as soon as possible.

The Bill will provide help to farmers who wish to diversify, and to village food shops and the communities that they serve. In both cases, it will reduce their costs by cutting their rate bills by at least 50 per cent.

These measures must not be viewed in isolation. They are part of our wider policies to support farming and rural communities. They arise from last year's action plan for farming and the rural White Paper, which are delivering further support to those communities.

The measures in the Bill were originally proposed last year. They are not specifically in response to the outbreak of foot and mouth disease, but the assistance that they will provide to farmers and to village food shops will now be even more welcome to those rural businesses. I commend the Bill to the House.

11.7 pm

Mr. Green

I am grateful for the Minister's generous words about Opposition Members' co-operation during the Bill's rapid passage through the House. Of course we have co-operated with the measure, because the Conservative party is the party that represents the British countryside and those who live and seek to have their livelihood within it If there were any last scintilla of doubt attending on that proposition, I would merely point out to the House that throughout this Parliament there has been a group called the Labour rural group of MPs, which claims to be 168 strong, and of those 168 champions of rural Britain, none, as far as my memory serves me, has contributed to our debate over the past couple of hours. That tells us all that we need to know about the attitude of those Labour Members who seek to represent rural constituencies.

As we reach the Bill's final stage in the House, Opposition Members have continued to make what we genuinely believe are constructive suggestions to make the Bill more generous and practical and to widen the scope of its provisions. It would then provide more assistance than the modest amount of help it currently offers.

Given that, in Committee, the Minister and his colleague the Minister for Local Government and the Regions said that several of the suggestions that Conservative Members had made were in principle worth looking at, it is genuinely disappointing that we have not seen a single Government amendment during the course of this week. The Government are aware of the pressure points that we have identified and the improvements that could be made to the Bill.

We in the Opposition have worked very hard. Despite the very fast passage of the Bill—its stages have been taken on successive days—we have tabled amendments at every stage. Given the resources available to the Government, I cannot believe that it would have been beyond their ken to do the same and make some of the improvements that, I suspect, they will realise need to be made. I am not speaking exclusively about the amendments tabled by Conservative Members. We voted in favour of one amendment that was tabled in Committee by the hon. Member for Somerton and Frome (Mr. Heath). Sadly, he is no longer in his place, which is a shame because I wish to pay him tribute for moving that extremely sensible amendment. I wish to do so not least because I suspect that it would be a valedictory tribute given that we do not expect him to grace our debates after the general election.

Mr. Gray

When my hon. Friend mistakenly referred to the fact that the hon. Member for Somerton and Frome (Mr. Heath) was no longer in his place earlier this evening, the hon. Gentleman reacted with anger and bitterness, saying that my hon. Friend's comments were disgraceful and that he had been here, but was speaking to Mr. Speaker. We now find that the hon. Gentleman has gone home to bed. Is that not disgraceful?

Mr. Green

My hon. Friend makes his point. I have no desire to criticise the hon. Gentleman.

Mr. Cotter

rose—

Mr. Green

I shall give way to the hon. Gentleman in a moment.

Mr. Deputy Speaker (Mr. Michael Lord)

Order. We are getting slightly off the subject, so perhaps it is as well to remind the House that, on Third Reading, we should discuss what is in the Bill, not what is not in it.

Mr. Green

I am grateful to you, Mr. Deputy Speaker, for that guidance. The Bill would have been improved if the amendment tabled by the hon. Member for Somerton and Frome had been accepted in Committee. I shall happily give way if the hon. Member for Weston-super-Mare (Mr. Cotter) still wishes to intervene, but I am making no personal criticism of the hon. Member for Somerton and Frome; I am simply saying that he will lose his seat to his Conservative opponent.

This small and modest Bill will do some important things, but everyone admits that it is relatively insignificant compared with the scale of the problem that faces those who seek to make and preserve their livelihoods in rural Britain today. As we know, the Bill will introduce 50 per cent. mandatory rate relief for five years for land and buildings that had previously been used for agricultural purposes. The relief will be limited to properties with rateable values of less than £6,000. The Bill will extend the 50 per cent. mandatory rate relief on sole rural shops and post offices, which was introduced by the previous Government, contrary to the slightly wild statements that the Minister made previously. Again, it states that those shops must have a rateable value of not more than £6,000.

I repeat that we support the Bill in principle because it will provide some small help, but there are many problems and criticisms, the bulk of which relate to the Bill's basic details. First, as has been said several times during the debates, the limit on the rateable value of less than £6,000 is inconsistent with the Government's view of small businesses in other parts of the economy.

The Minister made the point in an earlier debate that the relief was supposed not to be general, but targeted on small businesses. Yet it is targeted on businesses with a rateable value of less than £6,000, whereas small businesses are defined in the most recent Green Paper on the subject from the Department of Trade and Industry as those with a rateable value of less than £8,000. Four years on, we are still not being treated to the joined-up government that we were promised.

The DTI and the Department of the Environment, Transport and the Regions evidently take a fundamentally different view of what constitutes a small business. Regrettably, when dealing with the small business sector that faces the worst crisis of any of the crises faced by small businesses—those attempting to survive in rural areas—those in the DETR have chosen a less generous definition of such businesses than their colleagues in the DTI. The Minister will be aware that that is inadequate.

Mr. Tony McWalter (Hemel Hempstead)

Does the hon. Gentleman agree that the Government are responding, in part, to representations made by the Council for the Protection of Rural England that to give such relief to substantial businesses could have deleterious consequences for the environment that we are trying to protect?

Mr. Green

I do not think that is quite what the CPRE said, but I take the hon. Gentleman's point. If he is saying that businesses with a rateable value of £8,000 are big fat cats who do not deserve help, I suspect that he and I would be as one in thinking that view was wrong. Indeed, even if he and I disagreed on that point, he may agree with his colleagues in the DTI who appear to accept it as a definition of a small business. I am happy to take the Government's definition of what constitutes a small business. In Committee, I tabled an amendment that would have substituted £8,000 for £6,000, but it was rejected by Ministers. I was merely trying to make the Government's position more coherent.

Mr. Gray

Does my hon. Friend agree that the hon. Member for Hemel Hempstead (Mr. McWalter) is missing the point? The potentially damaging effects on the environment of bigger businesses in the countryside would be covered by the stringent and rigorous planning regime. Even if one wanted to set up an environmentally

deleterious business in a converted farm building, one could not do so. The size of the rateable value is thus irrelevant in environmental terms.

Mr. Green

My hon. Friend is right; environmental considerations should always be at the forefront of our mind when considering business development in rural areas. However, Bills dealing with rate relief, such as this one, should not be the lever for ensuring that appropriate environmental protection is imposed. Such protection is extremely important, but that is why there are planning regulations.

I hope that the Government will take on board the strictures of the National Farmers Union. It made a small number of sensible suggestions for improvements to the Bill—none of which the Government have chosen to take up or even to address. I cannot believe that the Under-Secretary of State for the Environment, Transport and the Regions did not receive the same NFU briefing, so he will be aware that the union is worried about the discretionary element which could lead to "competitive distortion" between local authorities. That is not because one local authority is more generous than another, but because some local authorities have more money available. The problem is genuine and although the means to address it are not necessarily obvious, the Government may well need to do so.

Another problem outlined by the NFU and for which it offered the Minister a solution is the fact that rate relief will be restricted to a maximum of five years, but will start only from the fixed date. Thus, someone who wanted to diversify a farm business three or four years after the commencement order under the Bill will not gain the full rate relief. Such a person might take business decisions based on the amount of rate relief that might theoretically be available, rather than on sensible business criteria. There was widespread agreement that that part of the Bill should be improved as it is likely to lead to problems.

We have held extensive discussions as to whether third parties who rent diversified agricultural land and buildings would benefit—another of the points raised by various of the bodies that have carefully considered the Bill. The Minister for Local Government and the Regions told us firmly that the definition of hereditaments that my hon. Friend the Member for North Wiltshire (Mr. Gray) had obtained from the Library was out of date, and that there was an extant, agreed legal definition—such that third parties who rented out buildings would be eligible for rate relief. We are, of course, happy to accept the Minister's assurance—we are sure that she is extremely well briefed. I only hope that she is right, not least for the sake of the Government's legal bills in years to come.

Also serious is the potential unfairness to existing riding schools. If things go wrong, the Bill might have a genuinely perverse impact on this country's equestrian sector. The Minister for Local Government and the Regions assured my hon. Friend the Member for North Wiltshire that she took on board many of his points about the inadequacy of the Bill as drafted in terms of its effect on the equestrian sector. My fear is that it might damage businesses that are already under pressure. I am sure that everyone on both sides of the House hopes that that will not happen, but it is regrettable that in our proceedings on the Bill we have not improved it so that it can cope with that problem.

The final specific point about the Bill as it stands from which problems might arise is the starting date. The Under-Secretary accepts that the problem of the delays that are inevitable in obtaining planning permission for diversification of farm buildings means that an early commencement date will result in the value of the early months of the rate relief being nugatory for most, if not all businesses, because no one will be able to enjoy the benefits when the delays in planning permission have prevented the businesses from getting started.

The Bill ought to be a lot better than it is, but its contents are better than nothing—extremely lukewarm praise. In terms of effectiveness, the Bill is probably in the top 20 per cent. of Bills introduced by the outgoing Government in that it is, at least, not wholly destructive. On that, I congratulate the Minister. I assure him and the House that when we get the chance, we will introduce our own comprehensive and radical measures that will give better, genuine and more widespread help to farms and other rural businesses.

11.22 pm
Mr. Cotter

It has been said that the Bill is not sufficiently extensive either in its scope or in terms of the rateable value that it covers. My hon. Friend the Member for Somerton and I Frome (Mr. Heath) said, rightly, that the measures it proposes are modest. I am quite sure that he will be in his place in the next Parliament.

As the Minister pointed out, in 18 years the Conservatives did little to support small businesses. Nowadays, they speak at length about small businesses, claim that they are the friends of small businesses and outline all the things that they will do for small businesses given the chance. None the less, the fact remains that although they had 18 years to work for small businesses, they failed to do so. We witnessed numerous bankruptcies and the problems that businesses experienced during the various recessions that they had to endure.

Mr. Green

The Bill amends an Act that was passed in 1988. Who does the hon. Gentleman think was in power when that Act, which introduced rate relief for businesses, was passed?

Mr. Cotter

The hon. Gentleman goes on about how much more should be done, but the Tories had a long time in which they could have done far better.

The Liberal Democrats have a clear scheme: relief for all businesses of less than £25,000 rateable value; and for the first £1,500 of rateable value, small businesses would be entirely let off, which would assist them greatly.

I am worried about the rateable values. The Association of Convenience Stores is clear that the £6,000 threshold is not enough. It believes that the threshold will help only a small number of shops because just a few will be eligible. Although the £9,000 rate for pubs is little higher, it has to take into account the fact that they often have living accommodation. Therefore, the same consideration applies. The organisation representing pub owners has made it clear that a business of that rateable value is almost unviable. There are concerns about the detail.

A little work through the House of Commons Library exposed the fact that the Bill's provisions amount to a modest relief of only £3 million. If the Minister disagrees with that figure, I shall be glad to hear his comments.

Mr. Gray

The hon. Gentleman is right: the Library estimates that £3 million a year and £16 million in total will be spent. How much would the scheme cost if it applied to the rateable value of £25,000, as proposed by the Liberal Democrats?

Mr. Cotter

The total amount spent would greatly relieve small businesses, which is the main consideration. The bill would be met in a neat fashion by adjusting the rates that the bigger concerns pay, which are out of kilter with what the smaller firms pay. Our proposal would cost the Exchequer nothing because we would play one off against the other.

In the spirit of tonight's end-of-term atmosphere, we are, at least, making a step in the right direction, and I hope that more will be taken. The Government said in Committee that, if they have a chance, they will suggest other proposals. We were especially concerned about the five-year limit that has been placed on providing assistance to business, which is a short time. We have to accept—or at least hope—that the Government will address the problem more broadly to cover rateable values for all businesses. I look forward to hearing the Minister's comments.

11.28 pm
Mr. Gray

I want to reiterate a point that has been made, and shall be brief. Although we welcome the ability of farmers to diversify and the provision of help to some village stores, one sector might be badly damaged. We have been losing about 200 to 250 riding schools a year because of the business rates that bear down heavily on them. The Bill allows a farm to diversify. It could decide to run a livery yard, a pony trekking business or a riding stables. That would put the existing riding school at the end of the drive into an unfortunate competitive position. According to the British Horse Society and the Association of British Riding Schools, that could spell disaster for riding schools.

Instead of the 50 per cent. rating outlined in the Bill, all equestrian businesses should be zero rated. Any new or existing horse business should be exempted from business rates. The easiest way to do that is to redefine the horse as an agricultural animal. If a farmer uses a shed for heavy horses, those animals count as agricultural animals and he pays no business rates on the property, but if he uses that shed for breeding any other horse, including a racehorse, he pays business rates. That is absurd.

The Government might also consider exempting new and existing horse businesses from business rates. Only by doing so can they possibly have a hope of saving these businesses. In the United Kingdom, 2.4 million people enjoy riding horses, so it is a very important industry. If the Bill goes through as it stands, it poses the real risk of wrecking those businesses. At the very last moment, on behalf of the horse industry and the people who enjoy riding, I appeal to the Minister to think again about what can be done to correct the Bill so that the industry can be saved.

11.30 pm
Mr. Robert Ainsworth

With the leave of the House, I shall respond briefly to some of the points that have been made.

The hon. Member for Ashford (Mr. Green) was right to say that, despite some of the comments that have been made tonight, the Bill's Committee stage was fairly constructive. Plenty of time was available and the debates were not curtailed. We agreed to consider some of the issues that had been raised, and we can do that without delaying the Bill's passage through the House. By allowing it to reach the statute book, we will be able to provide the useful reliefs that are contained in it.

I told the hon. Gentleman that I would consider the issue of commencement, and he also said that he was concerned about the discretionary element of the Bill. It will introduce mandatory relief for small shops in rural villages, and I hope that he is not suggesting that he wants to remove local authorities' ability to provide discretionary relief over and above that provided for by the Bill.

Mr. Green

indicated dissent.

Mr. Ainsworth

The hon. Gentleman suggests that he does not want to do that.

My right hon. Friend the Minister for Local Government and the Regions gave the hon. Gentleman clear definitions of hereditament, and I assure him that they are correct. He need have no worry about their application.

The hon. Member for Weston-super-Mare (Mr. Cotter) and others have tried to suggest that the measures in the Bill are modest. I think that there is wide consensus in the House on the need to encourage, when appropriate, farms businesses to diversify into other sectors. There is a psychological barrier on agricultural businesses crossing the threshold that means that they are subject to rates for the first time. However, the estimates of the cost of the measures in the Bill to help farms to diversify are between £16 million and £96 million, depending on take-up. It is estimated that the measures apply to 3,000 food shops that are not in rural villages with a population of fewer than 3,000, so our proposals are not as modest as some Opposition Members would have us believe.

The hon. Member for Ashford said that, given the opportunity, the Conservatives would introduce comprehensive and radical measures to help small businesses. Although Liberal Democrat Members accused me of engaging in party political polemic when I made the point that talk is cheap, we have read the book about the 18 years that the Conservatives were in office. They will, therefore, have to explain why what they now say about assistance to small businesses is different from what they practised when they were in power. They also have to explain how they would square the circle. When we debate our proposals in the House, they say that they do not go far enough and that more should be spent on this or that sector. However, they are committed to a massive programme of cuts. Their proposals do not add up.

On the small businesses that are not covered by the measures in the Bill, the Green Paper on local government finance proposed rate relief for all small businesses. It is targeted at those with a rateable value of above £6,000, and a taper goes up to a rateable value of £8,000. The Government are committed to considering the issue and legislation will be forthcoming on another occasion.

On this occasion, however, we have the opportunity to pass two useful measures that will help our rural communities and will assist farming businesses to diversify into other sectors. I commend the Bill to the House, and I hope that it receives the support of hon. Members.

Question put and agreed to.

Bill accordingly read the Third time, and passed.

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