Common Agricultural Policy (Hansard, 5 February 2004)

§ 3. Mr. Michael Jack (Fylde) (Con)
If she will make a statement on the proposals to implement the revised common agricultural policy. [152865]

§ The Secretary of State for Environment, Food and Rural Affairs (Margaret Beckett)
I hope to make an announcement on the model for allocating entitlements under the new single payment scheme in England in the near future.

§ Mr. Jack
I am grateful to the Secretary of State for her answer, but she will realise that since 26 June—when she announced to the House the outcome of the Agriculture Council, detailing the largest single change to the CAP since it was envisaged—Parliament has remained silent on this issue. Can she explain why no debate has been afforded to this House, in Government time, to inform her thinking on this matter? As an announcement from her is imminent, could she draw to the House's attention her reaction to the letter that she received from Herr Fischler? It clearly indicated his wish that member states use the historical basis to determine the allocation of single payments, which goes against the line floated by Lord Whitty at the Oxford farming conference on 6 January.

§ Margaret Beckett
First, the right hon. Gentleman correctly points out that the reform deal was agreed in June, and I am glad that he has at least recognised that it constitutes a very substantial reform. Of course, we then initiated a consultation process, and responses were received until—if I remember correctly—October or November. The responses were varied, a range of different views was expressed, and analysis of those views is being undertaken. I believe that I have reported that to the House on occasions such as this, and I know that I have made clear in exchanges across the Floor of the House the two biggest decisions: the full decoupling of subsidy from production; and the introduction of that change at the earliest possible date, in 2005.
On the letter that I received from Herr Fischler—he has written to all member states—I have read it with care and discussed these issues with him. His concern is that an attempt should not be made artificially to redistribute support on other criteria. He is of course also concerned that in every member state we establish sound principles for future schemes that will be of benefit to the farming community as a whole.
As for my noble Friend Lord Whitty's remarks at the Oxford conference, he made it clear that a range of issues has to be considered and weighed carefully. Indeed, such analysis and thinking is currently going on in the Department.

§ Mr. Lindsay Hoyle (Chorley)(Lab)
I wonder whether my right hon. Friend could assist in ensuring that the wealthiest of farmers, such as the Duke of 884 Westminster, do not benefit from CAP reform, and that support continues to be given to low-income farms and to tenant farmers, who struggle to make a living?

§ Margaret Beckett
As I said a moment ago, the Commission has advised against seeking redistribution for its own sake; on the other hand, my hon. Friend is absolutely right to raise the issue of low-income farmers and those who are currently beset by difficulties. The impact of potential change on the various participants in the world of farming, particularly the most vulnerable, is precisely one of the factors that we are seeking to weigh very carefully.

§ Mr. John Wilkinson (Ruislip-Northwood) (Con)
But is it not the case that even a reformed common agricultural policy will perpetuate grotesquely high food prices for consumers in the United Kingdom and maintain the distortion of international trade, which consciously, by means of protectionism and subsidies, ensures the impoverishment of primary agricultural producer countries in Latin America and elsewhere?

§ Margaret Beckett
The hon. Gentleman is certainly right to suggest that the reform deal will not have a major impact on food prices. However, he is doubtless conscious of the fact that if the British Government are able to achieve the reforms that we are seeking through the World Trade Organisation—to be fair, the rest of the European Union is also seeking them—that could have an impact on food prices in the longer term. But I accept part of the point that he makes, in that the impact on consumers will not be as great as some had hoped.

§ Lawrie Quinn (Scarborough and Whitby)(Lab)
My right hon. Friend's earlier answer to the substantive question will be welcomed in my part of the world. However, has her Department thought through the communications strategy, so that farmers, particularly those in the more remote areas such as the North York Moors national park, can fully understand the implications for their incomes, bearing in mind their particular status within the subsidy regime?

§ Margaret Beckett
I am grateful to my hon. Friend. My Department is giving careful consideration to how we can best communicate the implications of any proposals for farmers and farming communities. He and other hon. Members will know that we are slightly handicapped at the moment because some of the detailed regulations have not yet been produced. We are talking to the Commission and pressing it to come forward, which may help to shape the outcome.

§ Mr. John Whittingdale: (Maldon and East Chelmsford) (Con)
While it is clearly important to have widespread consultation on the matter, does the Secretary of State accept that the delay in announcing the decision is causing widespread uncertainty across the whole industry, and that it is also giving the Rural Payments Agency very little time to prepare for such an enormous change? Will she recognise that the vast majority of farmers have supported the case for decoupling, but on the basis of a historically based method of allocation? Whatever model is finally chosen, 885 the one thing that we must avoid is substituting one bureaucratic, complicated and costly system with another.

§ Margaret Beckett
I entirely endorse the hon. Gentleman's last remarks: we do want to avoid replacing one complicated and costly system with another, but we all recognise that there will be transitional issues. I am mindful of the impact on the Rural Payments Agency of the timing of any decisions, and we are constantly in touch with it. I accept that if the issue continued to drag on, it could become a cause of uncertainty, but farmers know the two most important points—that we intend to abandon the link between production and subsidy, and that we wish to do so as early as possible—and all our economic analysis suggests that that is what will have the greatest impact on our economy and the decisions that farmers take. Other factors are important, but less so in the scale of things. I can assure the hon. Gentleman that we in no sense wish to delay the decision for any longer than is needed to assess all the implications of the decisions that we have to take for the farming community as a whole.