HL Deb 30 October 1956 vol 199 cc1124-34

3.0 p.m.

Order of the Day for the Second Reading read.


My Lords, this Bill has two things to commend it. First, it is short, and that is something which I feel the House will appreciate; secondly, it reaffirms and continues a very important feature of agricultural policy—namely, support for hill and upland farming. This policy, initiated in the Hill Farming Act, 1946, and continued by the Livestock Rearing Act, 1951, has so often been spoken of with approval on both sides of your Lordships' House, that I am sure that it needs no further commendation from me.

The Acts allow Ministers to approve schemes for improving livestock-rearing land submitted up to November 6 this year. The schemes can cover a wide variety of work. The aim is to create up-to-date and economic holdings for the rearing of livestock in the uplands. Schemes of this kind attract a grant of half their cost, and I am glad to say that considerable use has been made of them. Since 1946, the number of schemes approved is approaching 10,000; they cover over 6 million acres and cost over £32 million. Over 1,000 more schemes are under consideration, and it is estimated that the cost of these will be about another £3½million, making a total of nearly £36 million.

Although the whole of the £20 million provided by the present Acts has not been earmarked for schemes so far, they continue to flow in, and we have come to the conclusion that we should be justified in continuing the Acts for a further seven years, by which time all those likely to undertake schemes should have submitted their plans. To cover the cost of these additional schemes we are providing a further £5 million, raising the total available under the Acts to £25 million, which could, if necessary, be increased by a further £2 million. We consider that this will make ample provision for the purpose.

The Acts also authorise the payment of subsidies on hill sheep and hill cattle. The hill sheep subsidy is a useful insurance policy for hill sheep farmers, and we think that it should continue. The hill cattle subsidy at present takes two forms. The more important, which is common to England and Wales, Scotland and Northern Ireland, consists in a subsidy on breeding herds kept on hill farms to rear store cattle for sale. We intend to continue this subsidy at the present rate of £10 a cow for the full period of seven years allowed by the Bill. The other subsidy, which is paid in England and Wales and Northern Ireland only, consists in a small payment of £2 a head paid on cattle grazed on hill pastures during the summer. This is a survival of a war-time subsidy designed to relieve lowland pastures during the ploughing up campaign. We consider that the original purpose of this subsidy has been fulfilled and we intend to discontinue it after this year.

I feel sure that this Bill will commend itself to both sides of the House. Although it is a short measure, it is an important one. A great deal has been said about the need for a long-term policy for agriculture. I feel that here we have an excellent example of that. I invite the House to give the Bill a Second Reading, and, as time is so short, I hope that your Lordships will feel able to pass this useful measure through all its remaining stages this afternoon. I beg to move that the Bill be now read a second time.

Moved, That the Bill be now read 2a.—(Earl St. Aldwyn.)

3.5 p.m.


My Lords, I am sure that we are all grateful to the noble Earl. Lord St. Aldwyn, for his clear and short explanation of this Bill. I think this Bill is one of the most striking examples we have had for some time of a bipartisan policy in agriculture. The policy of financial assistance for upland farmers which we initiated in the Hill Farming and Livestock Rearing Acts is being renewed, under the terms of this Bill, for a further period of seven years, instead of lapsing, as it would otherwise have done, at the end of the current year. I hope, and l am sure the noble Earl will share my hope, that this is a policy which will continue to be followed by Governments of all Parties, for I think it will be needed until such Lime as all the hill and upland farms in the United Kingdom that can become profitable and productive with the help of these monies will, in fact, have used them to add to our supply of borne-produced and home-killed sheep and cattle.

As the noble Earl has pointed out. it is satisfactory that improvement schemes since 1946 already cover over 6 million acres, and that at present 1.000 more schemes are under consideration by the authorities. But it should not be forgotten that there are about 16 million acres of hill and mountain rough gratings in this country and that there is still a considerable part of this area that could benefit from improvements. Of course, everything depends on the willingness of farmers to apply for grants and on the readiness of Ministers to sanction these grants wherever they can be justified. I should like to point out why, in my view, some farmers do not apply, even when their land would benefit, and to suggest what the Government could do to make this money more easily available for genuine applicants.

I remember, when I was at the Ministry, making a tour of the hill and upland farms in the north-eastern counties. I was much impressed by the admirable way in which large landowners and large owner-occupiers had taken advantage of this legislation to improve their land. For example, the properties owned by the noble Duke, the Duke of Northumberland, in the Cheviots,. were an excellent example of what can be done by good landlords to improve and modernise farms in upland areas. But I was no less impressed—though far less agreeably—by the real difficulties of the small men, the tenant farmers or owner-occupiers, with just a few acres of in-bye land and perhaps three or four times that amount on the fell. The small man just does not possess the capital required to finance his half-share in the cost of improvements, as required under the Act; and it is even harder for him, of course, because of his limited financial resources, to borrow the capital required for this purpose. That is much more difficult to-day, with the credit squeeze and the high rate of interest, than it was when I was in that part of the world, as long ago as 1951.

If the small man tries to get an overdraft from his bank and avoids the credit squeeze—and I think all credit is due to the Minister, and to the banks, too, for helping agriculture in this respect—he will have to pay interest at the rate of 6 per cent. But, more often than not, he has no assets to offer the bank as a security for his loan. What is needed, I think, is some form of credit for small farmers, on the security of their personal honesty and ability as farmers, on the prospect that they will make a success of the job and, being reliable and honest men, will repay the loan when they can do so. It is obvious that the commercial banks cannot be expected to give credit on this basis. It would have to come from some sort of public agency, such as the Agricultural Mortgage Corporation, with different and extended powers, or, possibly, from a new lending institution such as a Land Bank. These are merely ideas that I am throwing out, and to which I hope consideration will be given. I do not expect more than that at the moment.

The precise machinery for giving credit to these small men is, after all, of secondary importance. What really matters is Mat the Government should recognise that there is a crying need for capital for the small tenant farmers and owner-occupiers in England and Wales, and for crofters in Scotland, for the financing of these improvement schemes, which would greatly add to the supply of home-killed meat, and that the money they require cannot be raised at the present time by borrowing in the ordinary way. I read carefully the reply given in another place by the Under-Secretary of State to the complaints that were made by Members representing all parts of the country about difficulties experienced by these small men. I must admit that I was far from satisfied that he realised how serious this difficulty has become. I sincerely hope that the noble Earl will ask his officials in the Department—and that the Secretary of State will do the same for Scotland—to examine this problem carefully again to see whether there is not something that can be done.

My only other point relates to administrative procedure under these Acts. The existing administrative procedure has been severely criticised in the Arton Wilson Report, and I should like to read a passage from that Report. It says: Nevertheless, we were concerned to find that every scheme"— that is, every improvement scheme— has to pass through at least four different offices of the Ministry (county, district A.L.S. office, provincial A.L.S. office, and Headquarters) in addition to receiving a thorough vetting by members of the C.A.E.C. As a result, delays are greatly increased, and there is a lack of clear definition of responsibility for some aspects. It is that last sentence that I should like to underline. It is quite clear from that sentence that the Arton Wilson Committee consider that there is unnecessary delay and blurred responsibility in dealing with proposed improvement schemes put up for consideration by farmers.

In replying to this criticism in another place, the Minister said that a statement would "shortly" be made about action to be taken on the Report. I understand from the noble Earl opposite that there has, in fact, been a further ministerial reply to the question put in another place, but unfortunately I have been unable to trace it. Nevertheless, I think it would be most satisfactory if we could have a statement made in a debate on the Bill in Parliament, and perhaps it could be a little fuller than the reply given to the question asked in the other place. I should like to ask the noble Earl whether it might not be possible to deal with this particular stricture on administrative procedure in advance of the other recommendations of the Report, which will clearly need careful and prolonged consideration. If schemes are, in fact, being held up by clumsy administrative procedure, the sooner, this matter is put right the better. I hope—indeed, I feel sure— that this Bill will receive unanimous approval in all quarters of the House, and I certainly agree with the suggestion of the noble Earl that we should take it through all its stages this afternoon,

3.15 p.m.


My Lords, before the noble Earl opposite replies, there are one or two questions I should like to ask in regard to this Bill. I endorse what my noble friend Lord Listowel has said, and I think this is a step in the right direction towards a long-term policy for agriculture. This measure will, in the ordinary course of events, extend over a period of seventeen years, which is something almost unheard of before in regard to agricultural policy. I am afraid I expected a little more information from the noble Earl opposite, because this is a report on the operation of the Act over the last ten years. There are one or two points on which he may be able to give me further information, so that they need not be raised on the Committee stage on the Question that the clause stand part.

If it is possible, I should like to be given some information on the volume and the nature of the schemes that have been carried out: whether they are mostly schemes in regard to building operations; whether they have been improvement schemes. road schemes, schemes for ditching or draining—in other words, whether they have been schemes mainly in regard to building operations, and not so much for the improvement of land. Ten thousand schemes have already been approved and, from what has been said, I understand that the amount covered by the approved schemes is £12 million. A sum of £6 million has already been expended by the Government, and I conclude, therefore. that £6 million has been expended by the owners and occupiers who have carried out the schemes. As a matter of interest, I should like to know whether most of those carrying out the schemes have been owners or tenant-occupiers. I do not know whether it is possible to break down the information in that way, but, if so, it would be of interest to know.

My noble friend Lord Listowel has dealt with the question of cost. It seems that Her Majesty's Government anticipate that additional cost will he incurred in the future in regard to the carrying cut of these schemes. At the moment, the amount approved for the schemes works out on an average at about £3,000 a scheme. The 1,000 schemes which are under consideration now will apparently cost £5 million, which is at the rate of £5.000 a scheme. I should like to know what is likely to be the additional cost of those schemes which are now in operation but which have not yet been completed. A sum of £12 million has been spent on the completion of schemes, which on an average would be 4,000 schemes, leaving another 6,000 schemes to complete; that is to say, the difference between the 10,000 schemes approved and the 4,000 completed. What is likely to be the additional cost in relation to those 6,000 schemes? And if the Government have already agreed on a fixed amount as their contribution towards those schemes, will the additional cost be borne by the occupiers or the owners concerned in carrying them out? Of the £20 million already budgeted for under the original Act, the Government are to spend apparently £14 million. Will the owners and the occupiers be called upon to pay more than £14 million, on their basis of "fifty-fifty" or by reason of the additional cost which these schemes will involve, are the Government likely to increase their original estimate of £14 million? I hope that is clear, but really it boils down to this. I am troubled as to whether extra cost will be thrown upon those who are carrying out the schemes by the additional cost of wages and materials and whether the Government will still continue to pay only the amount which they have already undertaken to pay by the approval of the scheme.

I should like to make two other points. There are 1,000 schemes under consideration. Can the Minister say whether or not the application for schemes is slackening off; whether the Government envisage that, during the next seven years covered by this new Bill, the average number of schemes will be lower than those carried out or applied for during the last ten years'? There is a point in regard to the question of the subsidy for sheep. I understand that the subsidy for sheep was rot paid after the second year of the Bill, or thereabouts. The subsidy for sheep is still included in the present Bill which is under consideration. Do the Government anticipate that, owing to the lowering of the price of sheep, in future the subsidy for sheep will have to be renewed? Is it a fact that the numbers of sheep have increased as a result of the original subsidy and the original Act?

3.22 p.m.


My Lords, I should like to support what the noble Earl, Lord Listowel, has said about the importance of trying to get speedier machinery in regard to these hill sheep farming schemes. For quite a long time I have been associated with a small company in the Lake District which was formed for the purpose of buying these farms, running them as farms and protecting the amenities of the Lake District. This work was started before this type of scheme came into existence, but I should like to say that the Lake District Farm Estates Company is finding the scheme particularly valuable from the point of view of improving these farms. We have received the greatest assistance from the officers of the Ministry, and I should like to pay tribute to them.

The machinery is undoubtedly rather cumbrous, however, and in a number of these cases it has taken rather a long time to get it working. The consequent repercussions may have a bad effect, because nowadays it is not easy to get tenants for these farms, especially the more remote ones. If the whole thing is held up for a substantial period of time it may well be that there is a possibility of the farm becoming derelict just because there is an intermission; and it is exceedingly difficult when a farmer has not had a tenant for some time to find somebody else. This may become a serious matter. There is also the other point which the noble Lord, Lord Wise, raised: that in the interval, prices of labour and materials may go up quite substantially, which will give rise to further complications. Therefore, if a stage can be cut out of this rather slow, cumbersome process it would be of great advantage, and I hope the Government will do their best to look at this point and remedy it.

3.24 p.m.


My Lords, I am grateful to noble Lords who have spoken for the welcome they have given to this Bill. I will try to deal with some of the points which have been raised. Lord Wise, asked me a large number of questions, and I will deal with as many of them as I can. First of all, he asked me what percentage of these schemes was instituted by owners and what percentage by tenants. It is difficult to say, because they work in together. In a scheme of this sort it is inevitable that the scheme is submitted as one, and the tenants' portion covers basically the land, whereas the landlords' portion covers the fixed equipment. It is difficult to divide it up and get the sort of figure for which the noble Lord is asking. The noble Lord also asked how the schemes were divided as regards land and fixed equipment. I think I am right in saying that about 70 per cent. of the grants goes on fixed equipment and about 30 per cent. on land improvement.


May I interrupt the noble Earl? On those figures, would it be correct to say that 70 per cent. goes to the landlords and 30 per cent. to the tenants?


No I am afraid it does not work out quite like that.

The noble Lord, Lord Wise, was also worried as to what money the promoter of the scheme would, in fact, get. I presume he is visualising that an estimate is put in and that a grant is paid on the estimate. That is not so: the grant is paid on actual expenditure. Therefore, if the cost has risen between the time of the original application and the completion of the scheme then the grant will also automatically rise. On the question of the hill sheep subsidy, a basic reason for this is to guard against particularly bad winters which we have had on occasions and, no doubt, shall have again in the future. It is to assure the hill sheep producer that, in the event of bad weather, there is this machinery all ready to go into action as soon as it is required.

The noble Earl, Lord Listowel, and the noble Lord, Lord Chorley, were worried about the procedure in dealing with these cases. As the noble Earl said, a statement was made by my right honourable friend the Minister a little earlier on, and if I may give here some of the details of that statement I think it will be useful. The Minister has accepted certain of the recommendations in the Wilson Report. including that the county agricultural committees should be relieved of the straightforward work of grants and subsidies. This will be done in the divisional executive offices set up as recommended in the Report.

The Committee also suggested that county committees should hear appeals against decisions of officials. We think that the local knowledge and experience of the committee members might be brought to bear on these difficult cases before decisions are reached, rather than after. We have therefore decided as follows. Cases which are clearly ineligible will be rejected by officials at once, and where there is an element of discretion, selected committee members will be consulted at an early stage whenever there is doubt or difficulty, or if it is proposed to disallow claims or substantially to reduce them. After applicants have been notified of the decision, the committees will be consulted about representations which the officials are unable to settle amicably by themselves. In this way members will play a full part in the settlement of difficult cases and keep in touch with the work. In addition, the committees will be provided with regular reports summarising grants and subsidy administration by the officials. These arrangements will be applied to improvement grants and subsidies under the Hill Farming and Livestock Rearing Acts.


My Lords, can the noble Earl say when these new arrangements about which he has been talking will come into force?


My Lords, I am afraid that I cannot give the noble Earl an exact date, but it will be reasonably soon.

The noble Earl also raised the question of special credit for farmers. The case for a special credit agency for farmers has often been debated, and I do not propose at this moment to go in detail into the pros and cons, but I should like to say that if such an agency were to do anything which the existing agencies cannot do it would either have to take risks which they cannot take or give credit at a subsidised rate of interest. We do appreciate the difficulties of the small farmer who has had to use the money which he can raise to stock his farm, but there are various ways in which we try to make it easier for him to raise his share of the cost of these improvement schemes

In the first place, he does not have to find all the money at once. He can carry out the, improvements over a period of several years and claim the grant on each improvement as soon as it is completed. Secondly, he does not have to find the money to pay the whole of his builder's or contractor's accounts before he can get part of it back from the Government. He can send the bill to the Ministry with a request to pay the grant direct to the builder or contractor. He is then faced only with finding his portion of the balance. Another source of help is the hill cow subsidy, a proportion of which usually has to be spent on improving the land. This proportion is normally available to help the promoter of the scheme to pay his share of the cost of improvements.

On Question, Bill read 2a: Committee negatived.

Then, Standing Order No.41 having been dispensed with (pursuant to Resolution), Bill read 3a, and passed.