MARKETING OF WOODLAND PRODUCE

HL Deb 03 April 1957 vol 202 cc1023-93

2.52 p.m.

THE EARL OF BUCKINGHAMSHIRE rose to draw attention to the Report of the Committee on the Marketing of Woodland Produce published by the Forestry Commission; and to move for Papers. The noble Earl said: My Lords, in rising to move the Motion which stands in my name, I should like to preface my remarks by quoting part of a paragraph from a foreword to the memorandum of evidence that was presented to the Watson Committee. The particular part of the paragraph reads as follows: Is timber production in this country from now on to rank as a serious industry, or is it to degenerate into a rich man's plaything, incapable of making any serious contribution to the economy in peace or in war? The memorandum of evidence was presented to the Watson Committee by the United Kingdom Forestry Committee, and the foreword, from which that paragraph was quoted, was written by its chairman, Sir Richard Proby.

I need not go into the historical background of the present forestry policy—this House has debated that many times before. Suffice it to say that in recent years the need for the maintenance of a strong and stable forestry in this country has been strongly felt. Nor need I remind the House of the events which led up to the appointment of the Departmental Committee, whose Report we are discussing today. Suffice it to say that Her Majesty's Government were made well aware of them, and in the spring of 1954 appointed the Committee under the chairmanship of Sir Hugh Watson. The terms of reference show that the Committee were appointed: With the object of promoting confidence and stability, and bearing in mind both the output from Forestry Commission woodlands and the need to develop markets, to consider what measures might be taken within the home-timber industry to improve the arrangements for marketing produce from privately owned woodlands; and to report. That the Committee went into the whole position of forestry is clearly shown from the Report. It is a very full Report, and I am sure that the House will be grateful for it, although a number of us feel that the Report does not go far enough.

From the Report it is clear that the troubles and difficulties of private owners have been well seen by the Committee, but the remedies would appear to be insufficient to meet many of those difficulties. If I may again refer to the terms of reference, I would say that I very much doubt whether the Committee's recommendations are sufficient to promote the "confidence and stability" for which the Government asked. In particular, the Report makes no recommendation directly connected with marketing itself. Dealing with marketing, may I point to paragraph 139 which relates to this point? That paragraph says: One basic difficulty lies in the potential competition between State and private produce and in the dual responsibility of the Forestry Commission. This we believe to be at the root of the lack of confidence which was said to exist among private woodland owners. While it was made abundantly clear that the attitude of the Commission has in recent years been entirely friendly and co-operative, and while it is also true that the expected increase in the Commission's output may in some respects be beneficial to the marketing of home timber as a whole by attracting new buyers or industries, there does undoubtedly exist among a large number of private owners the feeling that they have in the final analysis no defence against the vastly superior resources and strength of the Commission if it were one day, under the pressure of economic competition, to be turned against them. This feeling is one that cannot be ignored in considering what measures might be taken to improve the arrangements for marketing. From that paragraph, it is clear that the Committee appreciated that the attitude of the Forestry Commission has been entirely helpful and co-operative.

I am sure we shall all agree that, so long as the noble Earl, Lord Radnor, remains as Chairman of the Commission, we have nothing to fear, but I hope the noble Earl will forgive me if I emphasise one point which the Report makes in that paragraph. The feeling of private owners that they have no defence is very real. The Committee then point to various weaknesses in the present marketing arrangements. Again, may I quote one sentence from their Report? The sentence is from the last part of paragraph 83, and says: It appears to us that there would be substantial advantages to both growers and merchants if in the main timber was sold annually, say in the summer, either by public auction with suitable safeguards, or after price negotiations arranged regionally with the interests concerned. Is this a recommendation? Because we do not find it—at least, I cannot find it—mentioned again in their conclusions.

May I now for a moment turn from criticism of the Forestry Commission and of the Report, to comments on us woodland owners, mentioned in the chapter "The Home Timber Industry"? They make the point that woodland owners in this country are very individualistic. Speaking as a woodland owner. I am not quite sure whether to take that as a compliment or something else, but I feel inclined to take it as a compliment. But the Committee contrast this—and I say this with all sincerity—with a number of associations that have been formed in different European countries. With regard to these co-operative societies, the Committee point out that help has been given in some areas where societies have been formed, but that their formation has been slow; and they point out, rightly, one or two of the reasons. They say that the expenses of running such a society are heavy and the risks not inconsiderable. They also say that it is clear that few, if any, of these societies will be able to extend the scope of their activities.

I can speak with some feeling on this particular question, because I am chairman of such a society which was formed in the Chiltern Hills area just about a year ago Towards the end of last year we came rather to a deadlock, and we came to that deadlock for want of members. We decided, therefore, that if possible we should appoint our own secretary-manager. Up to that time we had been using the good offices of the Agricultural Co-operative Association. Then we came up against the financial problem, and it was not until two members of our society volunteered to guarantee between them a sum of £500 that we were able to go ahead. At the beginning of this year, we appointed our secretary-manager. It is too early to tell your Lordships what the results of his appointment are likely to be—he has been working for only three months—but I give your Lordships the experience we have had to emphasise what the Report has said.

On this particular point, may I finish by again quoting one sentence from the Report. The Committee say, in connection with these co-operative societies, The influence of the larger landowners could be decisive. I profoundly agree with that statement. This is as far as the Committee go about co-operative societies, and I am sure that all those who are interested in these co-operative societies will agree with me when I say that we had hoped for something more positive. It is in the infancy of these societies that we need the most help. Let me say here that I do not want to belittle any of the help that we have had from what is now the Agricultural Central Co-operative Association, nor do I wish in the least to belittle the help that I personally know the Forestry Commission are willing to give. But it would be very much more satisfactory for these co-operative societies if they could feel that such financial help was in sight earlier than it is. May I also suggest to the noble Earl who is to reply that the Forestry Commission might appoint a senior executive in each conservancy to act as a technical adviser in the formation of these societies and help to keep an eye on them as they develop. I feel that the Watson Committee themselves might have been more positive on these points.

Coming back to marketing, one main difficulty, to which the Committee refer, is that of transport costs. The Committee rightly point out that these have a hampering effect; but again they make no recommendation. They just "suggest" that selective assistance might be given for those owners who live in remote areas. Here again, I feel that the Committee might have been more positive than they have been. I am sure we all agree that one of the fundamental difficulties in forestry is foreign competition. The Committee dealt with this matter in Chapter VI of their Report. As virtually all home-grown timber is sold in competition with imported timber, the prices are bound to be conditioned by world markets. I am sorry to quote from the Report again, but I feel that it lends support to what I am saying. The Report says at the end of paragraph 107: Apart from this the basic fact, which applies to almost all classes of timber grown in this country, is that the growers have for all practical purposes no control over the general movement of prices whether it be favourable or unfavourable. The prices which they receive are those which the timber trade can afford to pay them and no more, and they have no assurance that those prices will be sufficient to balance their current expenditure, let alone to provide an adequate return on such a long-term investment as forestry. May I take one particular side of forestry?—thinnings. Have the owners any assurance that they will be able to market these in the future? I very much doubt it. I think I am right in saying that the Committee make that point. Every year brings nearer the day when the flood of thinnings from post-war plantations will be put on the market. As it is, hardwood thinnings are becoming increasingly difficult to market. Again I wish the Committee had had more to say on this subject, because I feel sure that new uses must be found for these thinnings.

I have briefly skimmed over only some particular points in the Report. The United Kingdom Forestry Committee, in their evidence, stressed very strongly the difficulties and injustices that owners have found themselves up against and, in particular, the financial uncertainty they had to face. I personally, in common, I am sure, with other noble Lords, am very glad that the Committee endorsed this view in numerous passages in their Report, but I feel that it is disappointing that they should have produced so little in the way of remedy.

May I now turn to four specific points that the Committee dealt with in one way or another. The first was the subject of a levy-subsidy. The United Kingdom Forestry Committee brought forward this idea in their memorandum of evidence, where they stated quite clearly that they were conscious of the objections to a protective tariff or import restrictions on imported timber. The United Kingdom Forestry Committee therefore felt that this made it all the more reasonable to suggest in their memorandum of evidence that a levy subsidy should be raised. They proposed that a levy-subsidy should be placed on imported timber. Unfortunately, the Watson Committee, having gone very carefully into their terms of reference on this point, once again found that, as a result of the ministerial statement made in another place, in the Spring of 1954, they were not free to recommend any such thing as a levy-subsidy. I regret to have to say so, but I feel that I must criticise Her Majesty's Government for not having made their terms of reference wide enough to cover this. As I have said before, virtually all home-grown timber is marketed in competition with world timber, and if private forestry is to carry on, I am sure we shall all agree that it will need help. I feel that the levy-subsidy would not cost consumers very much, if anything more, and it would certainly be of invaluable assistance to foresters. Could I ask Her Majesty's Government to look at that point again?

May I now turn to the first of the Watson Committee's recommendations—it comes from their chapter on finance. They recommend that the present maintenance grant of 5s. 6d. per acre should be raised to 10s. for dedicated woodlands. They say nothing about any other woodlands. What about those owners who have not dedicated but have gone in for approved plans? I, personally, have not dedicated, although I have gone in for an approved plan. It may be that those who have dedicated have the right to receive more assistance than those who have gone in only for approved plans. But may I suggest that farmers are not required to give any guarantees for their subsidies. Why should foresters be asked to do so?

Exactly three months ago we were discussing the White Paper on the long-term agricultural policy. Among other things we learned that grants are to be made for fixed equipment, drainage schemes and roads on farms. Could not this apply also to forestry? May make that suggestion most strongly to Her Majesty's Government, and ask that they look into both points that I have just mentioned, both with regard to the raising of the grant as it is, and the grant for fixed equipment? I turn for a moment to the small man. What value is a grant of 10s. an acre going to be to the small man who owns only 10 to 150 acres? I wonder how many of us realise that such ownerships mean a lot of timber for this country. I understand, on good authority, that owners of under 150 acres represent 88 per cent. of the total in England, and 98 per cent. of the total in Wales. If I am wrong on that point no doubt I shall be corrected, but that is the percentage that I am given on good authority. While the 10s. an acre would be of some benefit to the larger man who owns 500 acres or more, I do not feel that it is going to be of much, if any, benefit to the small owner. Is there no way of assisting him?

I feel sure that we all agree that forestry is a long-term form of agriculture. I have always looked on it in that light, and I believe that that is the light in which we should all look at it. I am convinced that if Her Majesty's Government were to give a fraction of the help to forestry that they are giving to agriculture it would go a long way to promote the confidence and stability in forestry which is so sorely needed. If not, I venture to think, sadly, that forestry as an industry, and particularly those members who are small owners of 150 acres or under, will drift into a state of apathy.

I come now to the two main recommendations that the Committee made. The first was that of a strong and effective association of private woodland owners, and the second was the establishment of a central consultative body. With regard to the first, I welcome the idea that lies behind it very much indeed. In principle, there is no doubt that it is necessary. But perhaps when they made that recommendation some members of the Committee did not realise that we already have a large number of these associations. Speaking personally, my fear is that if another such association were formed quite separately, there might be an outcry of "What, another association!" Discouragement and apathy is such among owners that I doubt very much whether it would be easy to establish such a woodland owners' association without more positive encouragement for the small owner. I speak from experience here, and from forming a forestry cooperative society.

But may I make a suggestion which I know is being seriously thought out?—that this woodland owners' association might be formed as part of another association, on the lines of the horticultural side of the National Farmers' Union. I hope that by saying that I have helped noble Lords to realise that I am not in any way against the idea behind it. I would suggest—I believe this is being seriously thought of—that it be formed in England as part of the Country Landowners' Association, on the lines of the horticultural side of the National Farmers' Union, and possibly in Scotland as part of the Scottish Landowners' Association. The setting up of this organisation is going to take a lot of work. It is going to take a lot of finance, too. But I understand from the Report that in their evidence the Forestry Commission said that they would be prepared to consider a financial contribution covering a period of years towards the formation of this association. I feel that the idea is most important and I hope that it will be turned to good account.

The Report recommends that the present Home Grown Timber Advisory Committee should be converted into a central consultative body, that it should be given greater independence and wider powers, and, above all, have an independent chairman. If that is so, it appeals to me most strongly. But there is no doubt that private forestry will have to be effectively organised first—and here, of course is where the woodland owners association would come in. If this body is formed, I sincerely hope that it will be really—and I stress the word "really"—granted the powers and duties envisaged in the Report. To begin with, I feel sure we shall all agree that it is wise that initially it should be under the present chairman of the Forestry Commission. I hope that the noble Earl, Lord Radnor, will not take in any personal way what I now have to say, but the sooner the chairman of this body can be independent and the sooner the various bodies can select their own representatives to this central consultative body, the better. I hope I have said enough to show how the woodland owners feel about the Report. I would say here most strongly that what the woodland owners want is a clear indication from Her Majesty's Government that they, Her Majesty's Government, mean business in forestry.

My Lords, in closing may I quote from the Report two sentences completely out of their context? They are from paragraph 30. The Committee say at the end: The need to find markets for this changing pattern of production presents the industry with a fresh challenge. If against continued foreign competition this challenge is to be met, machinery must be devised for co-ordinating all constituent elements in regard to both production and marketing. I feel strongly that Her Majesty's Government, the Forestry Commission, the timber marketing associations such as there are, and responsible woodland owners who are producers must meet that challenge. It is a challenge to us all which we must meet. I beg to move for Papers.

3.20 p.m.

THE DUKE OF BUCCLEUCH AND QUEENSBERRY

My Lords, it falls to me first to thank the noble Earl, Lord Buckinghamshire, for introducing this debate and drawing attention to the problems of forestry at a very important time. He has covered the ground very thoroughly. I should like to support him in many things that he has said. Whilst I have had the honour of addressing your Lordships on forestry before, and feel rather diffident about doing so again, I may perhaps be able to add one or two further points. Having been a grower of trees and for many years much concerned in negotiations concerning forestry, I should always wish to support every endeavour in Parliament to advance forestry in the United Kingdom.

I am sure that we should begin to-day by expressing our warm gratitude to the chairman and members of the Watson Committee for the very hard work they have done and for the way in which they went about their task. Even if there may be some disappointment that, owing to the restricted nature of their remit, they were unable to make wider recommendations, they have put before us a most valuable Report and much information about forestry which has not been available before. I am sure that all those engaged in forestry will wish to do their best to co-operate with Her Majesty's Government in taking advantage of the Report and its suggestions. The Report confirms what a very uphill task people growing trees in this country have had for a long time, and emphasises that, if the country wishes forestry to be carried on on a much bigger scale, assistance is justified. The noble Earl has said it is regretted that the recommendation for a levy on imported timber had to be passed by, without discussion by the Committee. We feel that in this country, as in France, a very useful Forestry Fund could be established which would be helpful in producing any financial assistance necessary.

The main recommendations of the Report refer to an improvement of the organisation of the industry, and I am sure that in this respect all in the industry will do their best, for they have always wanted to continue to improve the organisation. This is less easy in an industry which, unlike other bigger industries in this country, is not prosperous; and if we are to fulfil the proposals in the Report, particularly those in regard to the Woodland Owners' Association, we must be able to put before woodland owners, and especially the smaller owners, something sufficiently attractive to induce them to join the organisation. The Report has encouraged larger woodland owners to give a lead and to try to bring everyone into this organisation. I believe that that will be an extremely difficult task unless Her Majesty's Government see their way to make the idea sufficiently attractive to the smaller woodland owners and to give those owners confidence that, if they do grow trees, they will be able to market them later. We have to show woodland owners that this new organisation, which must cost a large sum of money, will be able to help them, particularly in marketing their timber and selling to timber merchants more favourably than they have been able to to do in the past. That is the intention of this Report.

As their second recommendation the Committee suggest that a central consultative committee shall take the place of the present Home Timber Advisory Committee, and if this alteration is to be made it is to be hoped that the new committee will be more important, effective and influential than the existing body, and that its advice will be listened to very carefully and, one hopes, accepted. I do not wish to underestimate the value of the present Advisory Committee, but if there is to be a change in the organisation it is to be hoped that the new bodies will be more useful than those now existing.

In the Report there is an important recommendation on financial help. It is suggested that this should take the form of an increased maintenance grant for young plantations. That: is necessary, both to increase our planting and to improve the stocking of our young woodlands. An increased maintenance grant towards these things would be very helpful. There are differences of view as to how best to help forestry. Some would like more emphasis on final marketing and an assurance that there will be a better market for fully grown timber. But one must remember that few growers have sufficient timber for sale to enable them to pay for the initial cost of planting and establishing their woodlands. I feel, therefore, that the Watson Committee were right in advising an increased maintenance grant.

It has also been widely felt that if the nation wants these smaller owners of woodlands to make full use of land most suitable for timber, grants to them will require to be larger than to those with larger acreages. That is natural, for one knows that the cost per acre must be higher for the smallest woodlands owner. Above all, I would again urge the importance of establishing confidence within the industry—confidence from Parliament—with an assurance that Parliament and political Parties recognise forestry as an important industry and that they are 100 per cent. behind the national forestry policy. If your Lordships compare the cost of what is done for agriculture with that for forestry, and consider the position of private forestry in regard to grants, as compared with State forestry, I am sure it will be found that there is justification for helping private forestry rather more than it is being helped at present.

If Parliament and the Government really wish forestry to go ahead, and to be a successful and economic industry, there is now an opportunity to do something more for it. While trees of a sort can be grown by many people without much help, in order to establish woodlands of quality and volume, to secure men, house them well, train them in forestry and pay for everything necessary so that the right trees are grown in the right place, it is necessary to have the assurance from Parliament and the political Parties that they really recognise the industry. There is much difference between good woods and ordinary woods, and greater emphasis should always be placed on quality and volume, and also on prices, which are much more likely to be satisfactory if better conifers and the best hardwoods are produced.

May I now, under the heading of marketing and confidence, make a short reference to European Free Trade? In this connection, I should like an assurance that forestry will not be adversely affected. There has been a tendency to dismiss rather lightly the anxiety which exists regarding the possible effects on forestry of European Free Trade. There are references in the Report to the removal of subsidies in countries where they may be asked for to help forestry, and anxiety in the industry is likely to be increased unless doubts can be cleared away by the Government. If there is any doubt, would it not be better to combine forestry with agriculture, for exclusion from European Free Trade?

The noble Earl, Lord Buckinghamshire, has referred to capital grants for fixed equipment for forestry as well as for agriculture. I am sure that the giving of such grants would be a very helpful gesture. If the Government decided to include forestry with agriculture there are many important matters, such as roads, bridges and drains, in new forests, which do require capital expenditure. All those matters have to be attended to in addition to the provision of houses for those engaged on forestry work, and they are a drain upon capital. Our attention, I agree, is mainly on the growing of timber trees and on the people who grow them, but we should not overlook the progress of the home timber trade in the marketing of our limber. We learn from the home timber trade the importance of trying to increase sales of coniferous and hardwood timber now, not only because this is of importance from the point of view of our balance of payments, but also because it is necessary to maintain a healthy home timber trade. Unless there is more business and more encouragement to home timber merchants, it will be more difficult for them to keep going and be in a position to offer good prices to growers. Figures have been advanced by them claiming to show that a larger volume of the older trees could usefully be felled and that this would help to keep the timber industry going.

Finally, my Lords, may I ask whether the Government are satisfied with the progress of forestry, and if they feel that it is going ahead rapidly enough? We know that in this country the percentage of land under trees is very small indeed compared with that in other countries. Those of us who have examined the opportunities and the possibilities cannot help feeling that there is much land which, by arrangement with farmers and other agricultural interests, could usefully come under timber more quickly, without any harm being done to agriculture generally. In this connection, I should like to draw attention to the recently published Report of the Natural Resources Committee on Forestry, Agriculture and Marginal Land. I think your Lordships will find in that Report strong recommendations by a completely independent body for the increase and advancement of forestry in this country.

3.37 p.m.

LORD WISE

My Lords. I rise on this side of your Lordships' House with thanks to the noble Earl who has introduced this Motion. I think he has done service in calling attention to the Watson Committee's Report. As many noble Lords who are not actually engaged in woodland operations may wish to know what it is all about, may I just refer for one moment to the Report itself? The Report was made a year ago by a Committee set up in 1954 to deal with the question of marketing in connection with woodland products. The Report covers a tremendous field of investigation. The noble Earl referred to the numbers of societies and other organisations which are interested in woodlands, and I note on reference to the Report that no fewer than twenty-one societies came forward and gave evidence before the Committee. And not only did societies come forward, but Government bodies took part as well. I think it speaks well for the interest which was shown in the Committee's work that so many societies and so many individuals thought fit to give evidence.

The Report, as the noble Earl, Lord Buckinghamshire, has said, is not at all conclusive in its findings. But for those of us who are interested in woodlands and forestry it is crammed full of interesting points on matters which call for earnest consideration. As a small woodland owner—one of the 88 per cent. whom the noble Earl mentioned—I read this Report with very deep interest indeed. Having been connected all my life with forestry and kindred matters, I find here information which seems to me extremely good, and which I believe that everyone who is interested in any way in forestry can read with profit. I hope that all such individuals will take the trouble to read it. I wish to pay tribute to the Watson Committee as a whole for the work they have undertaken on our behalf.

The problems and the complications from which woodland owners suffer in so many respects are great and grave. Marketing has been referred to, and I shall deal with that in a moment or so. But we tend, as a body, as the noble Earl said, to be individualistic; we act singly and sometimes rather disjointedly. If, as a result of this Report, some new organisation, or some adjunct to an existing organisation, comes into operation, whereby we can market our products in an orderly and planned fashion, and secure a vast increase in the planting, felling and utilisation of timber and its by-products, this generation will have done useful work. We may not see the results of our labours, for timber planting is a long-term operation, but whatever we plant to-day will be harvested, not perhaps by our grandchildren, but by our great-grandchildren, whom we shall neither know nor see. Nor shall they know those who planted. So that afforestation presents problems which I hope will receive the consideration of Her Majesty's Government, as noble Lords have already asked. There is much satisfaction in planting trees and creating living organisms that will grow and continue to grow; in planting not entirely for our own benefit but for the benefit of the nation in days to come. That is an eminently social and self-sacrificing service which our generation can perform for the generations to come.

The noble Earl who introduced the Motion spoke of woodland operations as an industry. So far as the Forestry Commission is concerned, it is an industry, but for the individual owner it appears to me to be only an important estate operation, carried out in a spirit of hoping for the best and so that owners may admire what they have provided for the amenity of the countryside. According to the Report—and this is a point I want particularly to stress—a terrific task lies before woodland owners to-day. The Forestry Commission would like to see five million acres afforested by the end of this century, but they are not near that point at the present time. Five million acres is one-tenth of the whole land of this country, and your Lordships can grasp the tremendous forest area there will be if we have one-tenth of our land under trees.

I was interested in, and surprised by, the figures in the Report of the value of timber imported and of sales of home-produced timber. On an average, the value of timber imported amounts to £157 million a year. The pulp figure is £84 million, making a total of £241 million. The total value of home-grown timber which is sold or used is just over £10 million. It is suggested in the Report that in order to save imports and assist our balance of payments home-grown timber should in years to come account for one-third of the timber used. If that is to be done, the task will be monumental. We have to increase our output five times to provide one-third of the timber used, and if we are to provide one-third of both timber and pulp, it means that we have to lift up our home production no less than eight times. It is impossible for home growers, plus the Forestry Commission, to meet those figures unless we have the greatest possible assistance from Her Majesty's Government in many ways. We must have full co-operation, full coordination of production and efficient marketing machinery for the products.

Apart altogether from these figures, we may be faced in future with a lessening in the demand for timber for certain uses. Mining, the railways, housebuilding, furniture, boat-building and a large number of industries which now use timber may not require in years to come the amount of timber used at present. It might be possible to utilise timber in other directions and so offset the loss which we must inevitably face in the amount of home-grown timber used in industry, but it means that at the present time we cannot slow down. I hope that, whatever the future may bring, all the timber we can produce in Britain will be used here at home and that the people who are buying timber will buy British.

The noble Earl referred to timber prices. It seems to me that we who produce timber are in an awkward predicament, because the price is fixed by the timber merchant, and the home timber merchant is governed by world prices. Any rise in price or in costs is not passed on to the consumer by the timber merchant in the ordinary way; he takes it off the producer, and the price paid to the producer is so much lower. I notice that in one paragraph the report criticises the merchant, but my experience is that I have always had a fair deal from the British timber merchant. I speak, with experience, of excellent prices, fair measurements and a full and decent settlement. The only objection I have to our timber merchants is that they often leave a lot of stuff behind which is no good to anybody and has to be cleared away by the woodland owner.

I should like to say a word or two on the question of labour—and this is important in considering the matter of marketing and prices. No doubt those employed by the Forestry Commission have permanent occupations; but if the price to the woodland owner is low, it is impossible for him to employ the number of men he would employ. It has the effect of drawing into the unemployment market decent country labour. On the question of grant aids for small owners, I am entirely in accord with the two previous speakers. It is impossible for a small owner to make much out of 5s. 6d. per acre per annum. I hope, therefore, that the good favours in regard to the small owner which are coming from the Back Benches opposite will bear fruit with the Government Front Bench.

I have studied the recommendations of the Committee. I do not want to say much about the creation of a woodland owners' association or the extension of the Home Grown Timber Advisory Committee. Those recommendations may be excellent in their way and, if brought into operation, may have the result of assisting those whom we want to receive assistance. I believe the whole thing can be weighed up in the suggestion that the greatest possible co-operation should be brought into being between the three parties concerned—namely, the Forestry Commission, the woodland owners, and Her Majesty's Government.

3.52 p.m.

THE DUKE OF NORTHUMBERLAND

My Lords, before addressing a few remarks to your Lordships on this important Report, I feel I should make it clear that, while I happen to be a member of the National Forestry Committee for England, any views I may express this afternoon are purely personal. Disappointment has been widely expressed at the scanty recommendations of this Report. It would, I think, be fair comment to say that the Committee, having fully and correctly studied the problems, were unable to find the answers, and therefore suggested the setting up of two new bodies—that is to say, the Woodland Owners' Association and the central consultative body—in order to find the answers for them. It is true, however, that the terms of reference placed severe limitations upon them, and I think we should be grateful for the extremely hard work that they must have put into it, and for an illuminating Report, even if we are somewhat disappointed with the conclusions.

The recommendation as to the central consultative committee, both in regard to its composition and its functions, appears to me extremely sound, and I hope it will be accepted. On the other hand, the recommendation in regard to the Woodland Owners' Association should, I suggest, be treated with considerable reserve. To read the Report, one would almost think that no owners' organisations existed at all. That, of course, is far from the truth. There are the forestry societies and the various landowners' associations of one sort and another who have played a leading part in stimulating and helping woodland owners in their post-war programme. Some measure of their success is indicated by the steady progress of the dedication scheme, and the fact that the private sector of the industry has achieved—the noble Earl, Lord Radnor will correct me if I am wrong—some 80 per cent. of the target, as compared with some 60 per cent. achieved by the Forestry Commission.

There are also a number of cooperatives and other interests and organisations doing excellent work. In Scotland the Co-operative Forestry Society, which has been in existence since 1911, covers 250,000 acres, or roughly one-quarter of all privately owned woodland in Scotland; Northern Forestry Products covers 100,000 acres in the North of England; South Western Woodlands covers 50,000 acres in the area from Hampshire to Cornwall; Western Woodland Owners Limited are active on the Welsh Border and there are five societies in Wales; a new society, thanks to the energy and enthusiasm of the noble Earl, Lord Buckinghamshire, has just been started in the Chilterns; and another new society is in process of formation in East Anglia. Normally, these societies have found in the early days that it was necessary to call upon the Forestry Commission for guarantees or grants to put them on their feet; but almost invariably experience has shown that the need for direct assistance soon passes.

Developments in this direction are of particular benefit to small woodland owners, and should, I feel, be given every encouragement and active support. But the suggested Woodland Owners' Association would appear a very cumbersome and expensive body for the functions which it is to perform. Moreover, the difficulties of staffing such an organisation at this stage of forestry development in this country will be formidable; indeed, I very much doubt whether there are sufficient men with the technical ability available for staffing it, even with secondment from the Forestry Commission were that desirable. I am inclined to think that we should get more benefit from actively encouraging the cooperative societies, and particularly by encouraging the consultant and contractor services. However, it would seem advisable to ask the forestry societies and the landowners' associations to examine the proposal—in fact, the members of such a Woodland Owners' Association will have to be drawn mainly from the active members of those bodies—to find out whether they think that such an association, or variations of it, possibly on a regional basis could usefully be set up.

Paragraph 123 of the Report refers to the inability of private woodland owners to produce reliable evidence as to the economic and financial condition of their business. That inability is hardly surprising, because it has never been possible in this country, except between the Napoleonic Wars and the First World War, for owners to pursue an uninterrupted programme. The majority of our timber, and of that the best quality, was felled in the two world wars under conditions of strict price control. Nor, indeed, should the effects of the high rate of death duties be underestimated. That tax is blind in its effect, detrimental to the best interests of those who earn their livelihood by forestry, the direct cause of the disintegration of forest units of an economic size, and the means best calculated to ensure that long-term planning, good management and marketing organisation become impossible.

But there is a great deal of evidence and information on forestry costs and returns, and I would refer your Lordships in particular to the Annual Report of the Forest Economics section of the Imperial Forestry Institute at the University of Oxford and to the work of Mr. W.E. Hiley, at Darlington, and the work done, I believe, at the Aberdeen University. I will not weary your Lordships with difficult and highly technical calculations of woodland accounting, but I would suggest that, as a rough guide, if you are planting softwoods on a favourable site, and assuming that establishment is financed by money borrowed at 4 per cent., the project will break even—that is, the loan charges and interest will be paid off—at thirty-six years if grants are received, and at forty-six years if they are not received. That is, of course, assuming that the relationship between costs of labour, material and prices remains constant. If these calculations are reasonably correct and all goes well, after sixty years the whole project may earn some 7 per cent. But no profit can arise until the thirty-seventh year, and there are many variables—costs of extraction, transport, quality, quantity, and so on—which can make the proposition even less attractive. That, of course, would particularly apply to the planting of pure hardwoods.

Measured against that background, and considering the long-term nature and the many hazards involved, the present level of Government grants, which is certainly a help, is no great incentive, and it is not surprising, therefore, that many woodland owners look on the planting of trees as an act of faith rather than an economic proposition. It would seem, therefore, that the modest increase in the maintenance grants suggested by the Committee falls very short of an effective incentive. Apart from that, the present grants system is over-complicated, and the inconvenience both to private owners and to the Commission could, I suggest, be much reduced by changing the basis on which the continuing grant, which is called the maintenance grant, is at present assessed. It would seem that the easiest way to do this would be to base it on the area dedicated. That would avoid the necessity for annual assessments of the stocking of each compartment.

In the short term the considerations which govern investment in forestry are the immediate financial returns, and these depend upon the demand for the timber commodities produced from our woodlands. Two distinct problems arise: marketing of our mature timbers and the finding of outlets for the thinnings from our young plantations. In the case of mature timber, there is no prospect that supply will outrun demand—indeed, even when the Forestry Commission is in full production, the annual assessed yield will not meet more than one-third of our present-day requirements. But owing to our depleted supplies we shall not be able to compete either in quality or quantity with imported timber for a very long time, and many owners feel real anxiety as to whether economic prices will be maintained, or can be maintained, in the face of unrestricted imports from abroad. That there are grounds for those fears is, I think, justified, and one indication is the fact that we are importing oak and beech for the furniture industry to the value of £10 million annually, and these are the very hardwoods which are most characteristic of the South of England. These fears have given rise to a natural demand for various forms of protection, and a strong case has been developed by the United Kingdom Forestry Committee for an import levy. I hope we may have some assurance, at any rate, that the most careful consideration will be given to that suggestion.

In the case of outlets for thinnings, on the other hand, which include mining timber, pulpwood for various forms of hardboard, pulp for paper and pulp for fibre textiles, there is real danger that, as our young woods, and particularly Forestry Commission young plantations, come into full production, supplies will in fact outrun demand, unless we can find new outlets for our thinnings. In Scotland, the forests are already fulfilling nearly the whole requirements of the mines, and the output of thinnings is still increasing. The mines cannot, and never will, be our sole outlet for thinnings, and we shall have to turn increasingly to other outlets. In that connection, I feel that tribute should be paid to the part played by the Commission in assisting owners to market their produce and to find new outlets. This aspect of the work of the Commission is of particular importance and has not in the past, I feel, been fully recognised. As a result of the initiative taken by them, existing board mills in this country are taking an increased amount of their supplies from home woods, both State and private. This year, a further board mill, based entirely on home-grown timber, will be set up in North Wales, while in Dumfries-shire chipboard is being successfully produced from home-grown softwood thinnings. But here again a note of caution must be struck, because imports from Sweden are formidable competition, in spite of a 20 per cent. tariff, and it may well be unwise to assume that unlimited expansion of building board construction in this country will prove economical.

There is also increased consumption of home-grown timber in the manufacture of pulp. A new pulp mill is under construction in Cheshire, and it is hoped that a substantial proportion of the wood used will be home produced. For some years now the Commission have been co-operating with private enterprise in the problems connected with the establishment of a hardwood pulp mill. The result is that supplies of home-grown timber are being bought and stockpiled. The mill itself is being built, and it is hoped that it will soon come into production. It is only fair to say that none of these undertakings would in fact have been established unless the Forestry Commission had placed its knowledge of home woods at the disposal of the undertakings, and had given guarantees of minimum supplies sufficient to justify the large outlay of capital, at the same time leaving a substantial proportion of the demand to be met from supplies from private woodlands.

In spite of these admirable achievements, there can be no question but that we shall have an uphill task for a long time to keep what is virtually a new industry on its feet. I do not think we could reasonably expect the noble Earl who will reply to this debate this afternoon to provide us with solutions to all these problems, which are not in any case amenable to precise statement or easy solution. It would, however, go a long way to promoting confidence if we could have assurances from the Government that they are fully alive to the urgency of the problems which I have tried briefly to indicate; that they will continue actively to pursue research into new processes for the use of thinnings, and particularly in regard to small pulp mills; that they will encourage in every way the industrial uses of timber and that grants will be kept continually under review and adjusted in relation to costs and objectives. Given such assurances, I am confident that the private woodland owners can be relied upon to play their full part in the national forest programme.

4.11 p.m.

LORD DYNEVOR

My Lords, I rise to address your Lordships' House in a rather curious position, because I happen to be one of the signatories to the Report which is under discussion this afternoon. I can only say that I could wish that we had had the noble Duke, the Duke of Northumberland, as a member of our Committee, for a more masterly survey of the position we have rarely listened to. It was produced with great knowledge and (though it is almost impertinent of me to say so) with great confidence. Speaking, as I have just said, as a signatory to this Report—though I speak also as a woodland owner in a very small way—I feel almost that I am in the position of having to defend a rather unsatisfactory result. I can only say, in defence of our Report, that it has at any rate collected and collated much information which will be of immense value to all those who have studied the forestry situation.

The Committee was set up nearly three years ago and sat for two and a half years. It was set up largely, as we know, at the instance of woodland owners under the United Kingdom Forestry Committee, who were uneasily aware, as we all were, that something was wrong. We of that Committee were most disturbed at the feeling and, I must confess, at our difficulty in putting our finger on the real trouble, apart from the many aspects of the problem that we were debarred from discussing. Our terms of reference were very limited, as your Lordships have already heard. We were prevented from discussing anything that could possibly affect timber policy outside this country—that is to say, even the importation of timber, let alone any question of a levy-subsidy. It was very disappointing to those interested, and, I think I may say, to the members of the Committee, that they found themselves unable to give any consideration to a matter which has been mentioned in every speech that has been made—the question of giving some kind of direct financial assistance for timber production at home, or some action that would discourage the importation of timber from abroad. I strongly suspect that the Chancellor of the Exchequer does not want, if he can help it, to have to give any more financial aid, but that if he has to give such aid he wants to know exactly what he is going to give it to. That leads me to discuss for a few moments the recommendations contained in the Report.

The owners of timber in this country range from the owners of very large estates down to a very considerable number of small owners, each with, perhaps, 250 to 300 acres, not all of it necessarily woodland, but mixed up with their farming interests. We were favoured with a vast amount of evidence from all interests, not only the owners but also the importers, the merchants of both foreign and home-grown timber, the National Coal Board, British Railways, the Post Office, the furniture makers and all the other interests that go to make up the timber trades. Everybody went to a great deal of trouble to produce his evidence. The evidence ranged through the whole gamut, from the gentleman in Scotland who told us that he could not see what we were there for at all and would like to see the whole thing left entirely alone, to another engaging gentleman who said that his real interest in forestry was that the cover should be strategically placed to ensure a good run at fox hunting—though we did not take him seriously.

It would take me rather too long to explain altogether the whys and the wherefores of our conclusions, but there has been some criticism of the fact that we did not recommend even a marketing board on the lines of the milk, potato and other marketing boards. The answer to that criticism must be that forestry is a very different kind of crop from those covered by the ordinary agricultural marketing beards, where the produce is harvested, broadly, within the same financial year.

THE EARL OF BUCKINGHAMSHIRE

May I interrupt the noble Lord? I was not stressing a marketing board. My point was that there was no direct recommendation in the Report on marketing.

LORD DYNEVOR

I thank the noble Earl for his intervention. I was not specifically referring to a particular remark that he may have made, if he will forgive my saying so: I was referring to the general criticism that I have received in the course of conversations on this Report. I was just saying that the growth of timber is such a completely different proposition from that of the ordinary crop which, with the exception perhaps of livestock, is harvested within the actual financial period.

If your Lordships will refer to pages 50, 51, 52 and 53, I think you will find that they very much epitomise the way in which our minds worked. Paragraph 122 explains quite clearly, I think, why we did not feel able to make the recommendations that many owners would have liked us to make, but those four pages, 50 to 53, I should like particularly to draw to the attention of your Lordships. So we came to the conclusion that, if we were not to be allowed to recommend, as many growers wished, further financial aid, there should be a woodland owners' association. That was not done, if the noble Duke will forgive my saying so, merely to provide a solution which we were unable to find for ourselves. We felt and feel, quite strongly that only if the woodland owners can speak with a strong and clear voice will they be able to stand up, not only to Her Majesty's Government but also to the position—which is going to be very important—in a few years time when there will be a flood of timber coming on to the market from the Stale forests.

It is not enough to say, as the noble Duke said, that there were already a large number of these organisations in the country. We were well aware of that fact. But is not one of the causes of uneasiness among private owners to-day this very fear that in a few years' time they will be swamped, so far as softwood is concerned, by the State forests? For many years to come, the private forests will supply timber or hardwood, for the Forestry Commission plant, comparatively speaking, very little hardwood; and in any case it will take fifty, eighty or a hundred years to do any good. So far as hardwood is concerned, therefore, the private owner should be the main source of supply, if he can afford to market it. It was for these reasons that we recommended a woodland owners' association, in order to put the private owners in the strongest possible position to negotiate with the State and the Government, as occasion arises.

Tribute has already been paid by the noble Earl who introduced this debate to the present Chairman of the Forestry Commission, the noble Earl, Lord Radnor. I should like to add my own tribute to the manner in which he has conducted the Forestry Commission since he became its Chairman. In my view, by his complete understanding of the situation he has completely restored confidence between private interests and State interests. We need not look back many years to find a time when the reverse was the situation. Matters in human affairs, however, do not stand still, and we considered that, as a corollary of our proposed woodland owners' association, we should also recommend the setting up of a consultative body. Although we suggested that for an initial period the Chairman of the Forestry Commission might well be the chairman of this body, it would be most unwise for that to become a permanent feature of the organisation. It is essential that independence of view should be preserved by the consultative body and that it should have a strong bargaining position.

it is difficult to say much more. I am fully conscious of the fact that certain disappointments have been expressed on this Report, but I hope that I have explained to your Lordships why we were not able to go much further in certain directions. What is all-important—I commend this to Her Majesty's Government, and I know that the noble Earl who is to reply knows this very well—is that a forestry policy for this country is recognised as absolutely essential to its well-being. It must be a long-term policy. The longest-term policy I know of concerns a tree I once saw in California, which was 3,000 years old. It was a redwood which, I was told, started to grow at the time the last Pyramid was being built. That was an example of a very long-term policy. The normal return here, of fifteen to twenty years' minimum, is, of course, quite short in comparison, but it is a long time in terms of cash to the owner. It is easy to fell a tree: a few strokes of the axe, and down may come a fine growth of 200 years. I believe that every landowner has a duty to put back two trees for every one that he takes out. But, with the best will in the world, in this twentieth century, with rising costs against him, it is not easy always for him to afford the replanting.

Another point which was strongly made to us was that the forest owner has no say whatever in agricultural wages. He is not represented on the Agricultural Wages Board, and that is a source of grievance. And, of course, whether he likes it or not, the forester's wages are naturally tied to those of the agricultural worker. By the sheer economics of the thing, he would not get anyone to work for him unless he paid at least as much as that. Yet he has nothing to say about wages; all these costs rise against him, but he can make no protest in the actual negotiation, however much he may protest afterwards.

By and large, I would support those speakers who have asked that the Government should give their closest consideration and show a sympathetic attitude to this vitally important national industry, and that the Parliamentary Secretary should convey to the Chancellor of the Exchequer the views that have been expressed in what has been, perhaps, one of the best-informed debates on a particular subject that this House has ever staged. Indeed, I think that, with the exception of myself, no-one who has spoken or is going to speak to-day is less than a master of his subject. Surely that must impress upon Her Majesty's Government the deep feeling, indeed the deep need, if their policy of having five million acres under forest by the end of this century (which noble Lords will realise, with a shock, is now only 43 years ahead) is to succeed, that every encouragement must be given to this noble industry to keep it properly on its feet.

4.27 p.m.

LORD FORBES

My Lords, I am indeed grateful to the noble Earl who introduced this important Motion concerning the future of forestry. Other noble Lords have covered the ground with such skill that I do not wish to cover it again. I should like only to emphasize, or perhaps I should say re-emphasize, one point in connection with thinnings. To my mind, the proper silvicultural thinning of woodland is the most important thing in forestry to-day. I think this contention is borne out by the Forestry Commission themselves when they say, in their Bulletin No. 14, that neglect in thinning may lead to the total loss of a woodland through wind-throw or snow damage. This is also confirmed by paragraph 27 in this Report. Perhaps I may just quote from that paragraph: The growing of timber to the best advantage, from both the biological and the economic points of view, requires that there should be systematic thinning of the crop as the trees increase in size, beginning when they are about 20 years old or even earlier, and continuing Throughout the life of the stand. It does not need an expert eye to detect that thinnings, especially the earlier and less remunerative thinnings, are not being properly carried out in a number of privately owned woodlands to-day The reason for this poor silvicultural practice is. I think almost without doubt, one of finance. On many occasions I have heard a woodland owner admit that he realises that a plantation should be thinned but that he just cannot afford to do so, and instead he must wait until the trees have reached a more marketable size. I agree that this is a short-sighted policy, but unless the owner has large reserves of capital I think he has a genuine excuse, when one considers that the price paid for small thinnings, especially conifers, barely pays for the cost of extraction and sometimes an owner is left out of pocket.

Another difficulty is that the vast majority of our small conifer thinnings to-day have to be marketed through the National Coal Board—there is one market only. Then, to add fuel to the fire, we find in this Report that in 1960 the volume of conifer thinnings to be produced by the State forests will be about the equivalent of the thinnings to be produced by privately owned forests, but by 1980 the State forests will be producing about double the volume of thinnings as compared with privately owned forests. To many this fact might be most alarming. I personally do not take this view. I feel that the greatly increased volume of thinnings will help to produce alternative markets in the form of new industries which may be attracted to deal with these very small thinnings, which up till now have been almost unsaleable. With small thinnings coming forward in ever greater quantities there is now an urgent need to find fresh markets to absorb this particular type of material. Further, these markets must exist in the right places and at the right time.

There is another factor in connection with small thinnings: their profitability or otherwise often depends on transport. The cost of transport is governed by the distance of the material from the consumer—in this case, the collieries—and in this respect the South-West of England and the Highlands of Scotland come off especially badly. It occurs to me that not only the Highlands of Scotland but possibly the whole of Scotland, with the possible exception of the Border country, may in the future be vastly affected for another reason—the over-production of pit props. As we have already heard, Scotland is already almost self-supporting for home-grown pit props. When the volume of small thinnings increases, the excess will have to be sent South of the Border, and with the present high transport cost this would mean that the grower would be left with practically no margin.

If we look at the financial aspect of the establishment of a woodland we find that under the dedication scheme the Forestry Commission pay a planting grant of £17 an acre. They then go on to pay what I would call the absolutely miserable and measly sum of 5s. 6d. an acre for maintenance for the next fifteen years. What this 5s. 6d. is supposed to cover I have never discovered, but from practical experience I have found that in fact it covers the wage of one man to take one look at one acre once a year, and that is all. Then there is the grant towards the thinning of woodland which amounts to £3 15s. on the first and the second thinnings. One has to consider not only that forestry is a long-term project—a man sows or plants for his son or his grandchildren to reap—but that the owner or grower is subject to certain controls, such as being unable to fell timber when he wants to do so. Surely it is therefore crystal clear that the poor initial financial aspect in the period before thinnings bring in an adequate return is the greatest deterrent to private forestry to-day.

If the present lack of confidence referred to in the Report is to be dispersed I would recommend, first, that there should be research into new markets for small thinnings. This matter should be looked into with the utmost urgency and every encouragement should be given to industries prepared to give new outlets to small thinnings. Secondly, there should be provision of an interim scheme for each area to aid the grower until such time as the volume of thinnings justifies the setting up of new industries. This might necessitate a subsidy on transport over, say, 200 miles. I should like to stress at once that this would be only a temporary subsidy and that the interim period should be made as short as possible.

Thirdly, I would recommend that the maintenance grant should be increased to 15s. an acre. The Report says the amount should be at least 10s., but I believe that 15s. would be a fair figure. Fourthly, the present thinning grant, which amounts to £7 10s. over two thinnings, should be paid in full and only on the first thinning. This would cut out a lot of administrative work and the money saved in that way could be put to far better use in increasing the amount of the maintenance grant. The provision of suitable markets for small thinnings in each area and the adjustments I have mentioned would, I feel, do much to encourage private forestry, as the owner would get some return on his capital at a far earlier date than he gets it at present.

I hope that the noble Earl who is to reply for Her Majesty's Government will be able to give an assurance that some of these matters, at least, will receive some attention. In conclusion, I do not think I can do better than remind your Lordships and all who are interested in forestry or forest production of two facts, both of which are emphasised in the Report that we are discussing. The first is that much of our poor quality home-grown timber is due to lack of thinning; and the second, that every acre of timber grown by the private woodland owner means that the State is saved an outlay many times greater than any assistance given.

4.47 p.m.

VISCOUNT RIDLEY

My Lords, while I feel, with other noble Lords, that we should be grateful to the noble Lord, Lord Dynevor, and his colleagues for the work they have put into this Report and for the information they have collected which, as has been rightly said, is most valuable, at the same time I share in the feeling of other noble Lords that this Report, though it is a useful document, does not get us much further. The Woodland Owners' Association is a nice idea, but I feel that its rather limited objects are not going to be of any practical assistance in marketing.

May I shortly paraphrase those objects from the Report? They are: to represent the interests of forest growers; to see that owners appreciate the importance of forestry and what grants are available; and to build up a mass of information for them. The suggestion that a Woodland Owners' Association might also go into co-operative work for forest owners is a very good one. But as to whether it is better to build up a new organisation or to develop bodies like the existing Landowners' Association and forestry societies, I believe that neither of those courses will meet the situation we have in front of us. Nor do I think that the extension of co-operative forestry working is the whole answer.

We have in some parts of the country, and certainly in the North-East, organisations such as the Northern Forestry Products, referred to by the noble Duke, the Duke of Buccleuch and Queensberry. That has been very successful. The organisation is paying its way and all forestry owners belong to it. It affords a good deal of assistance, particularly to small owners. But with that experience of successfully-run co-operative work, those who benefit from it do not in fact make any more money from their products than they otherwise would do were they themselves able to do the work—that is to say, the bigger owners, who do not need the help of a co-operative society are not finding forestry profitable, as will be seen from the evidence given to the Committee. While, therefore, one would do everything possible to encourage such co-operative associations—and I am sure that it is right to do so—I cannot feel that that suggestion either is going to be the cure for our troubles.

As the object of the Committee whose Report we are discussing was briefly to try to provoke confidence and stability in the minds of those engaged in the industry, I think it is worth while looking back for a moment to see where that confidence has been lost. If your Lordships will look at Appendix J in this Report, you will see a good deal of the story. You will see the levels of controlled prices of home-grown timber from the beginning of the war till 1949. That is the whole story; there it is. The standing price of home-grown timber remained at the 1939 price until 1946. Then it was lifted by 25 per cent. above the 1939 level. This meant that owners of woodlands were debarred from taking advantage of the rise in prices of everything else, and debarred from taking steps to meet the rise in their costs resulting from inflation. Had the proceeds of the large quantity of timber then sold been in the hands of the owners and been available, it would have been very useful and a proper source from which to finance future development of the forestry industry. It seems to me that under a system of free enterprise a long-term investment like forestry stands a chance if it is allowed to take advantage of fluctuations and not allowed only to suffer in periods when costs and prices are against it.

It is worth noticing other disadvantages which private forestry inevitably suffers compared with State forestry and, indeed, compared with forestry in other countries where the scale of operations is much larger. Certainly in England—I cannot speak for Scotland at all—a large proportion of our privately-owned forests is in small blocks, scattered about. Each wood is comparatively small. There is good reason for that. Over the years people have found it is advantageous to plant with trees land which has not been very profitable for agriculture. They have planted land for shelter, and the general result has been that woodlands and agricultural properties have been integrated in such a way as to make the best use of the land. I think that is a very right and proper thing to do. It is a thing which suits a lowland country, such as most of England is, and suits a country where land is very scarce and the people are thick on the ground. We have got the most we can out of the acreage we have, which inevitably makes our costs very much higher per acre, and consequently also the cost of every cubic foot of timber grown is higher than if larger blocks could be cultivated. Alternatively, larger blocks of timber on higher land being further away require, a great deal more expenditure in the way of roads and transport, and so on. That is a difficulty which we have always with us.

Other noble Lords have referred to the situation with regard to pit props and thinnings. I would not, therefore, say any more about them except to mention one point which I think is material. When we are thinking of the increase in the production of pitwood from estate and private forests, it seems to me that, as the years go by, there is a tendency for the Coal Board to use more and more steel props and less and less timber. One does not know how far that process will go.

As we have a situation in which we lack confidence in the future, I feel that we must make some suggestions as to what cart be done to put it right. We believed that when the dedication scheme came in it was an earnest of the Government's intention that forestry should be put on a self-supporting basis. People were asked to dedicate their woodlands under the dedication scheme, thereby committing themselves to necessary expenditure to make those woodlands productive again after the extensive fellings which took place during the war. That was the reason for dedication—production. After the control of timber prices had been taken off and prices of home-grown timber had risen a little, it then seemed that it would be possible for the industry to keep going. But the situation has changed since then. Costs, in the form of wages and the prices of the materials necessary, have gone up, and the only comparatively slight relief we have had is the disappearance of the rabbit which, one hears on all sides, has proved to be only temporary. We are told that we can expect to have to buy large quantities of wire netting again.

Prices have certainly been very discouraging these last few years, and one is driven to only one conclusion, and it is a conclusion that I, for one, dislike intensely; it is that a form of subsidy is the only way to make the industry feel that it is worth while investing money in the growing of trees. The form of subsidy we have talked about is the planting grant, the maintenance grant and the thinning grant which we are getting from the Forestry Commission. I believe, from what has been said in your Lordships' House to-day that an increase is much more than justified.

The Committee recommend an additional 4s. 6d. an acre. When subsidy is paid for fifteen years and is paid on young plantations, if you have a rotation of seventy to seventy-five years that means that you are getting 4s. 6d. per acre a year on one-fifth of the total acreage; in other words, that is about 1s. an acre over the whole acreage, if my calculations are right. It is a remarkably small sum. It does not, in any calculation, go anywhere near to make up the difference represented by the costs we now have to meet for planting, maintenance and equipment. After all, one must have a lot more equipment and machinery to-day than one had in the past. One cannot now afford to have anything but tractors and other heavy and expensive machinery for a lot of forestry operations, and the cost of this does not diminish greatly from year to year. So we are in the unfortunate position of being compelled to say that, so far as we can see the market position at the present time, if the country wants timber to be grown, there will have to be subsidy at a higher rate than it now is.

We have, as growers, undertaken that we will grow timber and pay the cost of keeping it growing well and in good sylvicultural order. That is as far as we can go, unless we can see that either markets are available at prices to meet our costs, or those costs will be met from somewhere else. I appreciate what has been said about the successful efforts of the Forestry Commission to improve the marketing of various kinds of thinnings and by-products to board and pulp factories, but I do not believe that that will go very far. In a country such as ours, where, as I have said, we are operating mainly on small areas of woodlands and forests in private hands which lost during the war a lot of their matured timber, it does not seem to me that we can ourselves meet competition. Therefore I very much regret to have to say that subsidies must be increased to keep the supply of home-grown timber going.

4.50 p.m.

THE EARL OF LONSDALE

My Lords, we have heard a great deal this afternoon of the problems confronting the timber industry. We have considered this Report, and I am sure that we are all grateful to the noble Earl, Lord Buckinghamshire, for putting down this Motion and giving us the chance of discussing it. I think that the Report did not go far enough. Let us look at two of the main problems confronting the industry: first, the question of the high cost of establishing new plantations, and secondly, the difficulties of marketing. As the Report says, private growers have no control over their costs and they have no control over their receipts. As an aid to giving stability to the industry while production rises from the stage where it is now, of meeting 7 per cent. of the country's timber requirements, to that of meeting 33⅓ per cent. of requirements, which is expected in due course, the idea of imposing a quota on imported timber has been widely canvassed, and the use of a tariff or subsidy-levy has also been brought forward. I do not like any of these ideas. I believe that the industry should be made to stand on its own feet, through its own efforts, rather than be given protection, so possibly protecting and encouraging inefficiency. The industry should become more efficient in its own way.

Everybody is aware that timber growing is a long-term business, and it should be recognised that long-term stability is essential, particularly if both the Forestry Commission and private growers are to increase the forest acreage of this country from 3 million, which it has reached now, to 5 million in forty-odd years' time. That is an immense acreage. It means that 500,000 acres of forest must be planted every ten years. If the industry is to face such a task it will need great stability. The essence of the problem of marketing, as I see it, is the production of the right kind of timber. If good quality timber is produced, it should be able to sell in competition with imported timber in the future. The question of the marketing of thinnings, incidental to the growing of good quality saw timber, is being met, and I feel that it will continue to be met as output increases. As regards my own district, the North West of England, we now have all the facilities we need for the absorbing of our soft wood thinnings. We have a mill in Cheshire and one in Dumfriesshire which will be able to absorb all that is going to come out of the woodlands of the North West, including those of the Forestry Commission, during the next twenty or thirty years.

The Watson Report discloses a prejudice against home-grown timber, arising from its quality. This question is gone into in paragraphs 56 and 57, which are worth reading. Somewhere else in the Report it is slated in evidence that when home-grown timber was offered to a timber merchant he said that because it was home-grown he would give a third less than the price of comparable imported timber. This prejudice has grown up owing to the condition of the timber that has been put on the market for many years by home growers. In paragraph 57 the Report has this to say: …at the same time it has been admitted that by no means all of the timber standing in British woodlands to-day is of good quality, owing to neglect or wrong treatment in the past. This fact can only be accepted as part of the country's inheritance, and there is little, if anything, that the owners of to-day can do to remedy it; the lesson, however, is there for the future. That is the lesson I am trying to stress.

Historically, this country ceased growing timber commercially about 100 years ago, in the latter part of the nineteenth century, when cheap imported timber began to arrive. Thereafter, most of the timber that was planted—I am not saying all of it, because some of us had enlightened grandfathers—was planted for amenity reasons. Very little was planted otherwise and most of that as one noble Lord has already said, was planted for fox coverts. There was a gap in planting from 1870 to the Second World War. The First World War dealt a death blow to our reserves, and the Second World War used up what was left. It was only after the First World War, with the passing of the Forestry Act of 1919, that interest began to revive. Even so, between the two wars the Forestry Commission planted only 434,000 acres, and private forestry owners were planting only at the rate of 6,300 acres a year; and they were doing little to look after the woodlands they already had. The interest was not there, and the money was not available.

The present poor quality of our home-grown timber is, therefore, due first to the opinion of many people during the last 100 years, up to the Second World War, that there was no need to grow timber, and secondly to the fact that less attention was paid to the production of quality timber for commercial purposes than to planting for the purposes of amenity. In this connection it is alarming to discover that 25 per cent. of our reserves of standing timber is to be found in the hedgerows. As one would think, hedgerow timber is very poor quality, because it is grown with unrestricted branching and does not necessarily grow straight. Yet that inferior rough timber represents 25 per cent. of our reserves to-day. I feel that good quality timber should sell well and provide a return for the future. I think that it will compete with imports twenty or thirty years ahead. I think it is reasonable to suppose that it should, when transport costs for imported timber are rising constantly and a world shortage of timber is developing.

The growing of good timber requires care and management. It is not a case of planting a few acres, then shutting the gate and coming back, twenty years later, to start collecting the cash. Once trees have been planted, those that die out have to be replanted; the young trees have to be kept clear of rubbish; if there is a gale, some of them have to be propped up again; drains have to be kept open. And for the first five years, it is a continuous business to establish a new plantation; and after that it needs watching carefully and brushing carried out when the trees get to a certain height, in, perhaps, twelve or fifteen years' time. The first thinning comes along at about fifteen years and the second at twenty years, and with the second thinning the actual incurring of cost ceases; generally, the second thinning pays for itself.

I have talked to many people about the question of the average cost of establishing small plantations. The Report says that there is hardly any evidence of what the costs of forestry are, and that nobody really seems to know—it is covered in one small paragraph. In this connection, I feel that there is a case for some cost-finding to take place. As I say, I have talked to a number of people on the matter of costs, and probably the cost of establishing a smaller plantation in the hands of private owners, as opposed to the large State forests, what with rabbit wiring, ditching and everything else, and after grants have been paid, is as much as £50 or £60 an acre. Many people would probably dispute that figure, because, as I say, there is little unanimity as to what the cost is.

At the present rate of private planting, which was stated in the last Forestry Commission Report to be about 22,000 acres, the private investment in forestry is of the order of £1 million a year. Grants are at £28 15s. per acre, taking the period over which grants are paid—that is, planting, thinning and so on—leaving the private man £50 or £60 to find himself. Few people, particularly small owners—and we have heard to-day that 88 per cent. of the area in private hands is looked after by small owners—will feel readily disposed to go for new planting to any great extent on figures of this sort. This is a possible explanation of why only 410,000 acres of private woodland have been dedicated, out of the 2 million acres there are.

The Watson Report recommends a 10s. per acre maintenance grant, which means, roughly, giving another £4 per acre on top of the £28 15s., or one-seventh extra. This is hardly touching the problem, from the point of view of the private woodland owner; and more realism about the cost of establishing plantations with good quality timber is needed. Whatever is provided in the way of grants should undoubtedly be adjusted and revised according to varying costs and returns—say, every three years. I agree that the greatest assistance is necessary if we are to establish and grow good timber and be able to compete with imports without levying a tariff. Greater assistance will probably be needed for the smaller acreages than for the larger acreages. Greater grants might be paid for afforestation, and the replanting of war-time devastation than for the normal current replantings where some return has been received in the previous year or two. Recognition on the part of Her Majesty's Government, and of all concerned, of the cost of establishing plantations and greater assistance over the first twenty years, together with the association and the advising body proposed, should go a long way towards encouraging the growth of good quality timber which should be able to sell in competition with imported timber.

5.6 p.m.

EARL BATHURST

My Lords, I am sure that all your Lordships who have spoken this afternoon and have joined in thanking the noble Earl, Lord Buckinghamshire, for introducing this Motion have been speaking on behalf of landowners and woodland owners throughout the country. I am certain that those woodland owners will be waiting by their ears and by their eyes to hear and to see the comments which the noble Earl, Lord St. Aldwyn, will be making upon this Motion and on the Watson Report when he replies to the debate. We, as woodland owners, are waiting for leadership from the Government and from the Ministry concerned in marketing the produce, a sphere in which, as your Lordships have heard, difficulties abound. The Watson Report, which my noble friend Lord Dynevor has helped to plan in such a scholarly fashion—and I make no bones about saying that it is a most scholarly and clear-sighted Report—cannot possibly answer the need for forestry and for selling forestry produce in these times.

For ten years, experts on timber and forestry matters have been propounding these difficulties, which the noble Duke, the Duke of Northumberland, so excellently put before your Lordships a short time ago. For ten years, experts up and down the country, in landowners' associations, at forestry society meetings and on political platforms, have been explaining these problems and giving what they believe are solutions to them; and many of your Lordships have already put forward similar solutions. Unfortunately, as my noble friend Lord Dynevor said, the Committee upon which he served was unable, by the express desire of the Government, to put forward the solutions which we believe supply the only answers to the problems. My noble friend is not present in the Chamber at the moment, but I am certain that foxes will run every bit as straight from the Duke of Northumberland's magnificent woods as they do from the woods which were the subject of evidence given before his Committee. I would say, also, that foxes run every bit as straight from the woods that are owned—and they, too, are in magnificent shape—by the noble Earl who will reply to the debate.

A vast new productive industry has grown up in our country, and public money is largely responsible for it. Possibly even the noble Earl, Lord Radnor, cannot assess the amount of the taxpayers' money that since 1919 has gone into the capital asset which we now know as the State Woods (as they are advertised on the highways) of the Forestry Commission. Interest on that capital is about to be appreciated, after, I calculate, some twenty-nine years. It will be interesting to know if the noble Earl. Lord Radnor, will be able to say at some future date whether it is anything near the 7 per cent. which the noble Duke suggested it ought to be on his first thinnings. It is questionable at this time whether, in fact, we need this new industry, or so much more of it that has grown up in these last years. We have heard that 5 million acres is the target. A private woodland owner, trying to sell his thinnings, might well wonder, when he looks at the price he may receive for certain low-quality thinnings which he may be able to put on the market only with great difficulty, if there is indeed a market for as much timber as we have at present.

Private capital has also had a large part to play in bringing about this great new industry that has been created. The noble Duke and other noble Lords have already explained only too well the difficulties that beset private capital, especially where death duties are concerned. I should like to mention that the Forestry Commission, as the vehicle of the taxpayer for producing this great new industry, is also the financial body for private capital. It says how, when, where, what and at how much grant rate a private owner may carry on forestry operations. I believe that if a forester from the Moon or from Mars came down to this country he would hardly be able to understand such competition between the taxpayers' instrument, the nationalised concern, and a private capitalist, and would believe that it was little more than what could be vulgarly called a "racket". It is only the high calibre of such men as the noble Earl, Lord Radnor, and his staff up and down the country in the Forestry Commission, who prevent the activities of the taxpayer's vehicle for producing timber from being an extortion "racket" upon the private forestry owner.

I am quite certain that the Forestry Commission, and the Forestry Commission staff, know only too well the problems of the private owner, and they are trying by every means possible under their Charter to help the private owner to carry out the obligations which he takes on when he signs a dedication covenant. I wonder whether, by the end of the century—which as has been pointed out, is only some forty years away—we really need to produce one-third of the amount of timber that this country uses. I can look forward to the time when I shall be able to see that, though certain noble Lords of your Lordships' House will not be there.

But, if, at the end of this century, after advantage has been taken of the dedication grant and of all the advice of the Forestry Commission, the programme is running according to plan, and we are producing one-third of the timber we require, I do not think I shall be very pleased if it proves impossible to sell the results of what seems, from this distance, a very long time. That is exactly the position of the Forestry Commission today, in relation to 1919. We have as the objective 5 million acres of forestry productive land. In Sweden, that great timber-producing country, there are 58 million acres of forestry productive land—that is, about the area of all the available land in this country. I doubt whether a great industry, employing so many people in Sweden and in the other far European countries, could possibly afford to let their industry down in any way. It would seem that imported timber is available in every market, in a given quantity and at a given price. Should the taxpayer, together with private capital, be embarking on such an ambitious project as to produce himself nearly one-third of this required timber? We have heard that in 1950 we imported £157 million worth of timber, with £84 million worth of pulp- wood. To-day, the amount must be considerably in excess of that figure.

It would seem that there must be one of three plans, or possibly a combination of the three, that we should put forward if we are to carry out the plan envisaged in the Watson Report. The first is that consumption of timber in this country must go up considerably—yet that does not seem likely, except for low quality timber, with new processes that might come to hand. We hear on every side that pit props are no longer needed. The second plan would be to limit imports of timber from European countries, and from the dollar areas. That does not seem likely if the European Free Trade plans should materialise and affect the matter, as it would appear possible since the publication of the Watson Report. The third plan—and it is the most practical one—would be an incentive to use our own produce first, before buying foreign timber.

I believe, and I have heard the opinion expressed in various gatherings of expert timber growers, that if Government Departments and all national contracts could be compelled to use a certain percentage—it might be 5 per cent.; it might be 10 per cent.—of home-grown timber for a given type of specification on our national contracts and works, then the assured market would be present for all, not only for the Forestry Commission but also for the private owner, at competitive European prices. If that were so, there would be little need to increase subsidies and for further assistance either to private woodland owners or to the taxpayer, as owner of the Forestry Commission. Whether or not that is possible, I feel that such a scheme should have every investigation by Her Majesty's Government. It has been put forward so many times, yet it was expressly left out of the findings of the Report which we are discussing to-day.

The proposed Woodland Owners' Association might help us, but I cannot believe that the Association itself, as a nation-wide co-operative movement—or unco-operative movement, as it might turn out to be in certain individualistic areas—could possibly find markets for the type of produce we have been discussing. It would be an invaluable body, no doubt, in an advisory capacity. It would also be expensive to the taxpayer. I should like to see such money as would be spent upon such an Association diverted to the organisations which are already in being, who would be able either to open a new branch or a new account on behalf of forestry and woodland owners.

A consultative body, however, if it is able to put forward solutions with a fair chance that Her Majesty's Government and the Departments of the Ministries concerned will pay due attention to the expert advice that it puts forward, will, I believe, provide the most useful help and assistance to a woodland owner. Even so, unless that consultative body is able to show Her Majesty's Government that there is a market for this vast amount of new produce which has suddenly become available, then I cannot see any hope of that consultative body being able to assist us in any way whatsoever. I feel that a subsidy is a wrong "carrot" to offer to growers as a bonus to producing timber.

I feel that a market, and an assurance that such a market will always be present, is the real incentive to any woodland owner to grow timber in these times. A market can be found, but it is transport that is usually against him. Foreign countries take great trouble to see that cheap and competitive transport, usually the rivers, is available to transport their produce to special docks, which are largely owned by national undertakings, to ensure that their timber comes to this country at such cheap rates as to undercut our prices which the woodland owner is by Statute forced to pay to gain his produce. If any measure that Her Majesty's Government can take as a result of your Lordships' debate to-day, and as a result of the Watson Report, can ensure a special market for these thinnings, which have been produced by the taxpayers' money and by private capital, then the Watson Report and this debate will indeed have been a great help to woodland owners throughout the country.

5.21 p.m.

LORD STRATHEDEN AND CAMPBELL

My Lords, two aspects of this problem have been stressed mainly by your Lordships, and they are marketing and the small owner. I should like to try briefly to join these two together and see how the small owner can be assisted and helped in various ways. I personally think that one of the most important ways is something in the nature of the Woodland Owners' Association which is mentioned in the Report. Whether it should be a separate association or a branch of one of the many existing associations I do not know. In Scotland we already have a Co-operative Forestry Society which I, as a small woodland owner, have found of enormous assistance in technical advice, in the production of actual technical labour and in finding markets. But there is one thing that it cannot do and that is to achieve the co-ordination among owners necessary for co-operative marketing.

Here I should like to see the Forestry Commission go further than is envisaged in paragraph 153 of the Report, where the Committee mentioned the seconding of forestry officers to help the start of some woodland owners' association. The private woodland officers have a unique and detailed knowledge of what is going on in a very large number of woods throughout the country, and they are in a position to say that here and there woods of a certain age will be thinned. I think they could be of enormous value to an association or society in this coordinating work which, for the small owner, is extremely important.

Making some simple calculations from the Report of the Forestry Commission, I find that in 1955 the average planting on all dedicated woods was only 20 acres to each estate, and in the small woodlands it was down to 5 acres in the year per unit. These are not really economic sizes and must have assistance, both cooperatively and also, in my opinion, by means of a grant. The proposal put forward by the noble Earl, Lord Bathurst, that the real ideal should be the "carrot" of an assured sale at the end, is absolutely right, but an owner has to get over the time of planting, weeding of the woods, and that sort of thing, until he reaches that stage—and there are very few privately owned forests in which there is a proper rotation of an annual felling and an annual planting. In softwoods, it is a hundred-year rotation, and in hardwoods it is, of course, very much longer. Before an owner is really going to be sufficiently assured of a market to entice him to plant, that rotation must be carried out on a very large scale. Therefore, I am afraid, though one does not like to keep stressing this, that some form of subsidy is essential.

I should like to support my noble friend Lord Forbes in concentrating a thinning grant on the time when it is most required, which is the time of the first thinning, when the return is extremely small but the expense is great and the bulk of the grant, if it was paid then, would be a great help. Something must certainly be done about the maintenance grant. The present rate, in my opinion, bears rather the same relationship as the occasional 2s. or 3s., which a generous guest gives one when he uses one's telephone, bears to the enormous bill that comes in from the G.P.O. at the end of six months. These little maintenance grants do not bear any relationship to the time when the expense comes. They come only in set stages. It would be difficult to adjust the grant to set stages, but it can be adjusted so that a higher maintenance grant is made during the three or four years after planting when the weeding expense is very heavy. Those two things would be of the greatest assistance to woodland owners.

Finally I should like to stress a point which was made early in the debate by the noble Duke, the Duke of Buccleuch and Queensberry, on the European free trade agreement. The thought that any forestry products arrangements that may exist at present may be wiped out is very serious. So far as I understand the position, Her Majesty's Government have gone so far as to contract completely out of the agreement as regards agricultural products. It would be a great help to the confidence of the woodland owners if Her Majesty's Government could contract out of forest products.

5.28 p.m.

LORD BROCKET

My Lords, on the subject of forestry, we have had a very interesting debate from noble Lords who really know what they are talking about, which is not always the case among people who discuss these matters. We have heard this afternoon from the noble Duke, the Duke of Northumberland, that this Committee, which has, I think, produced a most interesting Report, has referred its solution to a further Committee. I rather feel that the terms of reference to Sir Hugh Watson and his colleagues were not wide enough, because they read: With the object of promoting confidence and stability, and bearing in mind both the output from Forestry Commission woodlands and the need to develop markets, to consider what measures might be taken within the home timber industry to improve the arrangements for marketing produce from privately owned woodlands; and to report. If only it had said: to improve the arrangements for the production and marketing of produce from privately owned woodlands I think it would have been far better, because it seems to me that the present terms of reference are really putting the cart before the horse. If I may get a little nearer the donkey simile of the noble Lord, Lord Stratheden and Campbell, the carrot of an assured sale is very good in the long run, but unless the woodland owner can not only afford to plant his trees but can be assured that his grandchildren or his great-grandchildren, as was mentioned by the noble Lord, Lord Wise, may reap the crop, there is no incentive whatever for him to plant his trees in the first instance.

In 1941 I had the honour to move a Resolution which was supported by all Parties in your Lordships' House in favour of a long-term non-Party policy for agriculture. I think I can take it that forestry, which necessitates a much longer-term policy than agriculture, is also supported by all Parties. We have had an excellent speech from the noble Lord, Lord Wise, who mentioned what I said just now. He said: "What we plan to-day may be harvested not by our grandchildren, but by our great-grandchildren." That raises a subject which I have previously mentioned in your Lordships' House—that of death duties. If a woodland owner was in possession of funds worth £100,000 when he planted the trees, by the time his grandchildren or great-grandchildren reap the crop they will be in possession of only £15,000. Of course, the woodlands would all have been sold a long time before that; and whether or not the original planter dedicated his woodlands, there is a clause in the dedication scheme whereby, if the woodlands are sold, the dedication may be abrogated.

The fact is that the estate would probably be sold to a speculator, who might easily cut down all the available trees and leave the rest of the woodland in a derelict condition. That is not helpful to our long-term policy for forestry, and I feel that if only the terms of reference to this Committee had been wider, we might have had the financial angle of death duties brought in. It is no good extracting from the pockets of taxpaying agricultural landowners a sum in the neighbourhood of £3 million a year, and at the same time, in reverse, having to pour back subsidies from the taxpayer. That seems to me ridiculous. I do not think that either any business or any country can go on successfully under those arrangements.

There are one or two small points that I should like to mention; they have already been raised by other noble Lords. One concerns the 5s. 6d. per acre for productive woodland. Quite frankly, as I once said to the late Lord Robinson, it is an insult to woodland owners. The sum of 5s. 6d. an acre will pay for one forester for two hours' work a year on the acre. Frankly, that is quite ludicrous. Also, although it looks as if we are all wanting money from the Treasury (which no doubt woodland owners are), the planting grant is not in step with present costs. Unfortunately, as inflation seems to continue, daily or weekly, and as the present wage rate for agricultural and forestry workers is over £7 per week as compared with 32s. in 1939, it is absolutely necessary that both the planting grant and the rate per acre should be advanced.

My Lords, I do not intend to say anything further, except that I was glad to hear the question raised of free trade for Europe. I should like to add my plea that forestry should be linked with agriculture, and excepted from free trade for Europe. Many people in business, as well as in agriculture and forestry, are most concerned with the question of free trade for Europe. I have heard car manufacturers say that the country will be overrun with Volkswagens. I expect that will be the case; but we do not want it to be overrun any more than it is at present with foreign timber.

5.35 p.m.

THE EARL OF DUNDEE

My Lords. I think the country is indebted to my noble friend Lord Dynevor and all other members of the Watson Committee for the valuable work which they have done. But I am sure my noble friend will not mind my saying that the Watson Report, which we are now considering, is a very small baby indeed. Much as I should like to do so, I find it difficult to congratulate anybody, either on the birth of this baby or on the methods by which it was conceived. The terms of reference given to the Committee by the Government seemed designed to exclude almost every subject of major importance which the United Kingdom Forestry Committee particularly wanted to be considered, and although there is a reference to marketing in the terms of reference, the Report does not contain any direct recommendation about marketing I am not going to spend any time in criticising the Report, because it seems to me that the procreative powers of the Government are probably exhausted, at least in this particular direction. I think we have to make the best of this rather puny infant with which we have been presented. I certainly do not want to say anything which might embarrass the "midwife" who is going to reply to the debate: I am quite sure that my noble friend is not personally responsible for this rather disappointing act of generation.

The Report makes only three positive recommendations. One is that the maintenance grant should be increased, and the others propose the setting up of two bodies, one of which is to be consultative and the other merely an association whose administrative expenses will, in my view, have to be almost entirely met by the Government if it is ever to be of any use, otherwise I think that the treasurer of this association will have great difficulty in collecting subscriptions from any of the members.

May I just remind your Lordships of the reasons why it is considered desirable to give any assistance at all to private forestry? In two world wars the country has been helped to survive only by the almost entire depletion of our reserves of standing timber, which had been accumulated by many generations of private planters. Most of these woods were commandeered, in the national interest, at controlled prices, and the greater part of them were commandeered and felled at an immature age—twenty or thirty years before they would have been cut in the normal course of events. The vast devastated areas with which we were left at the end of the First World War had not nearly been replanted when the Second World War caused still further devastation; and the country is now covered with these huge, devastated areas which the owner, if he does his duty, is expected to try to replant. But he has to do as much replanting in one generation as would normally be done in three or four generations, if the woods are run on a proper silvicultural rotation; and his planting costs are bound to be exceptionally high, because the longer devastated land remains unplanted, the stronger becomes the growth of scrub and weeds that must be removed. The owner has to do these things in a period when general taxation has become so crushing that it is difficult to apply any funds to this purpose at all.

At the same time, owing to the fact that our timber reserves have been so tremendously exhausted, it is again necessary, in the national interest, to prevent the owner from cutting down much of his mature timber—he can do it only under licence. That, of course, deprives him of a great deal of the revenue which normally would be used for the purpose of replacing. Having been deprived of his capital when his trees had reached an immature stage of growth, and were taken at a low controlled price he is now partly deprived of: he means of replacing it. As for timber prices, all through this century, whenever the world price of limber has gone very high, the Government have always "slapped on" controls and prevented owners getting the full world price; but when the world price has come down, control has always been taken off. There has never been any bottom put on timber prices, as there has been on agricultural prices, so that when prices are high the timber owner is deprived of the high world price but, unlike the farmer, when prices go down, he has no guarantee on which to rely for the future.

At present there are two principal kinds of assistance given by the Government. There is the planting grant and the special concession, designed principally to help owners of large areas of devastated woodland in regard to income tax. The normal method of assessing woodland is, and ought always to be, under Schedule B, but to help people with vast areas of devastated woodland an owner is given the option (which he can exercise only once in his life) of putting part of his woods under Schedule D, so that he may recover income tax on his annual loss. That is a very valuable help in replanting devastated woodland, but a great deal of its psychological value in creating confidence has been destroyed by the continued indication that, before long, this special privilege, as it is, may be converted into a universal rule. If that were done, and all woodland were taxed under Schedule D, it would completely kill private forestry in this country.

That course was proposed in the Budget of 1948 but, fortunately, Sir Stafford Cripps, who was then Chancellor of the Exchequer, was persuaded that its consequences would be disastrous, and he withdrew it. Last year, the Royal Commission on Taxation proposed that the Schedule B assessment should be abolished and that woodland should be treated under a different kind of Schedule D; and though I am assured that this is merely a suggested nominal change, it is bound to create the feeling in everybody's mind that the way is being prepared for a system of taxing woodland which will be entirely unsuitable to private forestry. It is that kind of thing which destroys confidence—and at the present time there is not very much confidence among private woodland owners in the future of forestry.

It is a remarkably creditable fact, as the noble Duke, the Duke of Northumberland, has pointed out, that private planting has achieved 80 per cent. of the post-war target, compared with the 60 per cent. achieved by the Forestry Commission. But that has largely been done by people who love forestry so much that their interest is greater and stronger than their apprehensions about the future. All of us who are serving on regional advisory committees set up under the Forestry Act know how extremely difficult it is to persuade large numbers of small woodland owners to come in and to dedicate their woodlands, or to bring them under the approved woodland scheme under the Forestry Act. It is easy to understand their point of view. They all feel that the great Departments of State know very little, and perhaps care rather less, about forestry; and they do not really believe that Parliament will for long persist with its declared intention of preserving a progressive forestry policy in this country.

I should like to draw your Lordships' attention to paragraph 119, of the Watson Report, where it is stated that every additional acre of timber grown by the private owner means that the State is saved an outlay many times greater than any assistance given to the private owner. That is to say, assistance to the private owner is a far more inexpensive method of getting what we want done in the national interest than a greater extension of State forestry. I believe that all your Lordships will agree that the Forestry Commission are doing an extremely good job. I think we shall equally agree that, if we are to achieve our national forestry target, we cannot do it either through the Forestry Commission alone or through private planters alone. We must have both. There must be a marriage between private forestry and State forestry; and it is for all of us to do the best we can to see that this marriage is a happy one, as I believe it is. What we are now asking Her Majesty's Government to do is to strengthen a little the position of the weaker partner in the marriage, to put him, or her (whichever sex your Lordships may think is metaphorically the weaker), in a rather more independent and responsible position in this partnership. We believe that it would be well worth while to do so.

The noble Earl, Lord Buckinghamshire, said a good deal about the small woodland owner, as did my noble friend who has just spoken. They were right to do so, for in Britain, and particularly in England, a very great proportion of woodlands the proper management of which is essential to the achievement of our national forestry policy are very small woodlands, scattered about among fields and farms all over the country and owned by a large number of small owners. The small owner cannot always be expected to be such a keen forester as the large one. If a man has 2,000 acres of woodland, then naturally forestry is likely to be one of his main interests in life; whereas if a man has only an acre or two of scattered woodland, his main interest will probably be agriculture or something else, and we cannot expect him to be so knowledgeable or so active in pursuit of a forestry policy as the larger man may be. In considering the position of the private owner we must, therefore, put greater emphasis on the small owner.

May I end by looking again at these three recommendations of the Watson Committee: first, that the maintenance grant should be increased to 10s. an acre. In my view, and I believe in the view of the United Kingdom Forestry Committee, this proposed increase is quite insufficient. But we should like to have it weighted in favour of the small owner, not only because it is more necessary to encourage him but also because it is probable that his overhead costs are greater in relation to his output. He may have one forester for only fifty acres of woodland, and his overheads will be larger in relation to output than the owner with several thousand acres. We should like Her Majesty's Government to approve a maintenance grant of £1 per acre per year for the first 200 acres. After that, the grant should be progressively reduced, a kind of inverted surtax, so that the man with a great deal of woodland would get £1 per acre only on the first 200 acres and, after that, less and less. He would not get the full proportion of the whole grant, even though, economically, one could justify a flat rate of £1 an acre. In view of the limitation on funds, I believe that it is far better to concentrate on the smaller man.

The only other recommendation to which I am going to allude is this proposal to set up a Woodland Owners' Association. The important point is that that might impinge on the question of marketing, with which the Report has not dealt directly. Here again, what is to be done should be mainly for the benefit of the small owner. If the large owner wants to thin, perhaps, 200 acres at a time, he probably finds no great difficulty in getting a timber merchant to come and do the work, because for such a large area it is worth the merchant's while to bring in equipment, establish sawmills and remain there for say, two years and pay an economic price. But if a man has to thin, say, five acres here, and one there and then, two or three years later, another ten acres somewhere else, it is not worth a timber merchant's while to come a long way for such a small quantity of timber. In fact, those owners sometimes find it quite impossible to get an economic price for their thinnings.

In such cases, the only possible way of doing it seems to me to be through some kind of organised collective marketing, which it is suggested should be one of the functions of the Woodland Owners' Association. In Scotland, it might well be a new development of the co-operative society, which we have already. In England, it has been suggested that it might be the C.L.A. Whatever form the organisation takes, it seems to me that we shall not see a large membership if the small woodland owners are expected to pay a large subscription when they join. They do not know much about it; they are already paying a subscription, probably, to the National Farmers' Union and also, if interested in forestry, to the Royal Forestry Society. So they will not be willing to pay another big subscription unless they appreciate that it will be worth their while to do so—which they have not much reason to believe at present. So I think it will be well worth while for the State to pay the expenses of an organisation of this kind, at least for a considerable period until its value to the small owner has been proved.

Another point in connection with this subject to which I want the Government to pay attention concerns the Restrictive Trade Practices Act, which was passed last year. I think that if there were a co-operative selling scheme, the manufacturers who bought timber from the co-operative society might find that they were committing some offence under that Act. A marketing scheme is exempt from the operation of the Act, but a marketing scheme is ruled out by this Report. I am not suggesting that it ought to be in, but merely pointing out that under the Act this plan would not be exempt. The proposed Association would not be a Government Department, which is also exempt under the Act. Therefore, I think that it might require amending legislation if the Committee's proposal were to be adopted.

There is one general consideration that I should like to mention, in conclusion. In paragraphs 123 to 125 of the Report, immediately before the Summary, your Lordships will see that the Committee express the view that very much greater assistance to private owners than they recommend may be justified, though they say that they were not able to get the necessary evidence on which to make a conclusion on that point. I cannot help feeling that this last observation rather illustrates the tentative and incomplete nature of this Report as a whole. The Committee have done very good work, but, as they admit, they have not been able to get enough evidence to answer questions they were supposed to answer. The terms of reference unquestionably precluded their considering a great many other questions which we know they would have liked to consider. Therefore, I hope that the Government will not feel themselves precluded from going beyond the recommendations of this Report.

The life of a tree, as Lord Dynevor said, is a very long thing. It is not always as long as that of the tree in California, of which he was talking, but it is usually a good deal longer than the average life of a man. Therefore it is a very doubtful subject for long-term investment, especially in times when hardly anyone has any money to invest. Almost everything of that kind has to be done now by borrowing. The present rate for forestry loans is 5¾ per cent. and not 4 per cent., as the noble Duke, the Duke of Northumberland, suggested, and one needs to be very careful when money has to be borrowed at that rate of interest. On an ordinary bank overdraft, the rate is even more—6 or 6½ per cent. One of my friends told me the other day that he had pinned his bank overdraft to a tree—which I thought was a very sporting thing to do. But he is an exceptionally keen forester. What we want to do is to create more confidence among ordinary people who are not buoyed up by this kind of excessive optimism. If we achieve our national target of 5 million acres of well-managed woodland in the next fifty years, the Government will have to go a good deal beyond this Report, and do what they can now to establish as much confidence as may be compatible with the uncertainty of all human affairs.

5.56 p.m.

EARL WALDEGRAVE

My Lords, I hesitate to intervene at this late hour, for I am not amongst the "giants" as are other noble Lords who have spoken in this debate. I am not a large woodland owner nor am I a great expert on this subject. But I am glad to be able to follow the noble Earl, Lord Dundee, who, although he is himself, I believe, a large forest owner, has spoken so strongly and so eloquently of the needs of the small owner. For a few moments I should like also to speak on that topic. Figures were given earlier showing that in England there are at least 20,000 owners, in Wales over 5,000 and in Scotland perhaps under 3,000. But in all three countries the great majority of the woodlands are in the hands of very small owners indeed, and we cannot hope for success with any form of policy that overlooks the interests of the small woodland owner.

It seems to me that if we have to deal with independent, sometimes uninstructed, sometimes uneconomic small units like this, we have readily at hand a parallel to which we can turn, and a remedy. Those of us who are familiar with agriculture know that that is exactly the same position with which we were always faced in agriculture. We have had these small, independent, sometimes uneconomic units in a disorganised state, as a weak seller facing an organised, strong buyer. In passing, I should like to say that the agricultural parallel was, I think, dismissed rather cavalierly by Lord Dynevor and his colleagues at, I think, paragraph 114 of the Report. I do not think it should be so dismissed, for I believe that we must have a joint forestry and agricultural policy. I believe that the two aspects of this one business are absolutely inseparable. They must be integrated, and much more closely integrated than they have been in the past.

Recently we added another "F" to the title of the Minister of Agriculture. We had for many years been familiar with the Minister as the Minister of Agriculture and Fisheries—or the "M.A.F." Another "F" was recently added to his title to make him the Minister of Agriculture, Fisheries and Food. I believe that we shall have inevitably—and I believe we shall welcome this—to invest our Minister with yet another "F", so that he will be the Minister of Agriculture, Forestry, Fisheries and Food. Until we get this unified command I do not think we shall be able properly to integrate these two branches of what really are the same industry as they should be integrated.

If we follow this argument in connection with agriculture, what has been the position in regard to it in the years gone by? Surely it is only fair to say that as long as we relied on exhortation, platitude, voluntary organisation and so on, we were not able to get agriculture on to an even keel. It was not until the late 1930s, when Lord Addison's Marketing Acts came on to the Statute Book, that we really began to get any "teeth" into agricultural policy and to tell farmers that we were able to implement the excellent intention that all Governments had about agriculture. We do not live in Utopia and I suggest that in this particularly long-term industry, forestry, we shall find that until we have some powers, we shall not be able to produce an adequate policy. We shall need a Minister, we shall need legislation, and we shall need that legislation to be armed with the one thing we must have to stabilise the industry—that is, some form of price or market support. That is the case in the agriculture of every nation, from the richest to the poorest. There is price support in the rich nation of the United States of America and I am sure that we are not rich enough in this country to do without it.

The whole terms of reference of the Watson Committee were made with the object of producing confidence and stability In 1954, there was a marked lack of these. Your Lordships will remember that controls had just come off and prices, which first had risen sharply, had begun to fall away alarmingly. The new dedication scheme was hanging lire and many owners, like myself, had not dedicated at that time. We were continually asking advice about what we should do about dedication, and often we were told that the parallel was in the Agriculture Act: that we must do our share, then the Government would do theirs. Some of us doubted this and said that the Government would not undertake to stabilise the market, and the reply was that the Watson Committee was going into the question of marketing—this was said in May, 1954—and if we waited until their Report came out we should have the answer. I believe that economics are the key to confidence and that in an industry like this, marketing is the key to that confidence. We produce, but shall we ever be able to sell what we produce?

I turn to the Report. This is a most admirable Report, which is going to be of the greatest value to the industry for a long time. The facts are admirably marshalled and everything is here—except the end. Paragraph 107 of the Report is of such importance that even at this late hour I should like to quote it. Referring to prices of home-grown timber, it says: The prices which they"— the growers— receive are those which the timber trade can afford to pay them and no more, and they have no assurance that these prices will be sufficient to balance their current expenditure, let alone provide an adequate return on such a long-term investment as forestry. The Watson Committee completely realised that the price of timber was dominated by the price of foreign timber and that if the merchant had to reduce his price, the only person to whom he could reduce his buying price was the grower. There can be no stability and confidence in such a situation. These difficulties were clearly recognised.

The Committee's Report appeared after two and a half years. J believe that the Forestry Commission had the Report presented to them in two years' time, in May, 1956, but it was not until another six months that the Commission were able to publish it. I think that they alleged that there was some trouble about a strike in the Stationery Office, but other documents were printed, and I suppose that this was the only reason why this Report was so very long delayed. When the Report came out, we found that to generate this confidence and bring about this stability only three suggestions were put forward. The first was that there should be a larger monetary grant, an increase of 4s. 6d. per acre on the flat rate, which will mean £22 10s. to a man with 100 acres of woodland, though 100 acres is larger than the average in England. I think that that is hardly enough. The second suggestion is regarding this voluntary co-operative society. That might conceivably be possible in Scotland, where there are comparatively few owners and many of them large ones, but in my view it is inconceivable that we can get an all-embracing co-operative association in England and Wales. The third is that there should be a consultative body—but a body with an admirable chairman and no "teeth" is not strong enough.

I do not wish to minimise the value of these recommendations, but I do say that this is not a forestry policy. It is not getting down to fundamentals, but merely detailing methods of implementing a policy. These alone will not achieve the confidence and stability which were the object of the Committee. I am sure that stability will not be achieved until the national forestry policy is reaffirmed. Previous Ministers have enunciated that there should be this five million acres of new planting and this partnership between the private owners and the State, but surely on the parallel of agriculture this really means that if the private owner will bear his share, follow the rules, in this case, of good silviculture, and bind himself by a dedication covenant under far more onerous terms than any farmer binds himself under Part II of the Agriculture Act, 1947, there will be produced somewhere at some time the equivalent of Part I of the Act, which will give him some kind of stability, some guaranteed price and some bottom to his market, in return for the heavy burden he takes on his shoulders.

The establishment of confidence is even more urgent now than it was in 1954. That has been brought out by many speakers this afternoon. It is true that prices have somewhat recovered in certain sections, for certain hardwoods particularly, but two new factors which were not before us in 1954 have to be carefully considered. The European free trade area outlined in the White Paper may make almost impossible any form of direct assistance to the industry. I do not know, but it is a new hazard. Then there is the new legislation on restrictive practices, which has come in since 1954, and that may hamstring the collective contracts for pitwood or pulp wood that are recommended in this Report as sensible plans. Thirdly, there is the ever-increasing urgency of the volume of the product that we have to sell. These figures are tremendous. This year the Forestry Commission will have about 15 million cubic feet of softwood thinnings to sell, but it is estimated that in 1975 the quantity will have risen to 44 million cubic feet; and the private owner will probably add to that another 20 million cubic feet. So that we may have 64 million cubic feet of softwood thinnings to sell in 1975, against under 20 million that is being sold to-day. Scotland is already producing all the pitwood required in Scottish mines.

It is difficult to see how a marketing of this magnitude can be handled "on the cheap", as it were. Her Majesty's Government on this matter really must not try to paddle without getting their feet wet. There is going to be a huge marketing problem, and we must think clearly about it, about the restrictive practices, and about European free trade in that connection, as well. There is a strange lack of proportion in this whole aspect. Agriculture costs the taxpayer some £240 million, but the total payments under the dedication scheme in 1954, according to the Report, were not much more than £240,000. There is a tremendous gap here. It is not only the money that is required—and I stress this—but confidence. Though voluntary co-operation, consultative councils and the acreage grants may, in their own way, be essential and of the greatest importance, I am sure that they will not prove enough, and that in the end we shall have to meet the challenge in forestry as we have met it in agriculture. We shall not be able to exclude marketing Boards, quotas, levies, tariffs or methods of that nature if we really mean business. We must have legislation and we must have a bottom put into the market.

The Watson Committee Report has had the excellent effect of bringing home to many of us who are not experts on the matter the size of the problem. What we need now, and what we hope the Government will be able to give, is a re-statement of forestry policy and, in particular, of the economics of forestry policy; and this must not be restricted, as the Watson Committee was restricted, but must be allowed to get down to fundamentals.

6.14 p.m.

THE EARL OF YARBOROUGH

My Lords, the proposed Woodland Owners' Association and the Central Consultative body may be all very well in their way, but, as has been said, the Report does not mention marketing. I feel that this has been due to the fear that the private owner might be undersold by the Forestry Commission. I know that at present the relations of the Forestry Commission and ourselves are very happy, but, so far as I know, ours is the only country in the world where the private owner does not feel able to work hand in hand with his State Forestry Department. I speak only for myself, and I realise that I am in a small minority, but I should like to consider the Forestry Commission not as trade rivals but as valuable allies—and that because they have this large quantity of conifer thinnings to dispose of.

For obvious reasons, Government Departments are just as anxious as the private owner to show a profit, and the State must find a market for these thinnings—in other words, if we are "up a gum tree", so is the State. I would propose that the private owner, if he wished, should be able to send his conifer thinnings for disposal by the Forestry Commission. This would also have the effect of getting round the Restrictive Trade Practices Act, because Government Departments would not be bound by this legislation. If this happy marriage of State and private owner could be consummated, I believe that the children of the union would bless both the parents. Incidentally, it would be in accordance with the dictates of justice, because the private owner has found the bulk of the timber requirements of this country in two wars and sold them at a fixed and farcical price.

6.17 p.m.

LORD HYLTON

My Lords, as the fifteenth and last speaker on this Motion of my noble friend Lord Buckinghamshire, I know your Lordships will not expect me to throw much more cold water over the recommendations and findings of the Report that we are discussing. Enough cold water has been thrown on those recommendations to float off the whole of the private woodlands in England. Be that as it may, I feel that there have been some remarkable speeches made to your Lordships to-day, and particularly those of my noble friends Lord Dundee and the Duke of Northumberland; and my noble friend Lord Waldegrave, who spoke only a few moments ago, took perhaps the longest view of this matter. Undoubtedly, forestry must be looked on as long-term agriculture. If that view is taken, it surely follows that forestry products are in exactly the same boat as agricultural products, and must be treated in the same way.

The difficulty is that, instead of being cropped once a year, forestry land is cropped only once a century. That being so, it makes it even more important that the conditions under which it is planted and maintained, and the produce eventually sold, shall be fair to the private woodland owner. If your Lordships look at the Forestry Commission Report for last year, you will see that to-day there are in Great Britain over 1 million acres of woodlands, felled, coppice and scrub. Why are they not planted? It is because conditions are not right or fair, largely owing to the enormous waste of estate duty on owners of these woodlands. Until some of these handicaps are mitigated, it is almost impossible to see how these enormous felled areas of scrubland will be replanted.

The Forestry Commission refer in their Report to the great difficulty they have in finding new land for planting, yet there are over 1 million acres of old woodland not replanted. That must be, I am afraid, a considerable criticism of forestry as it is administered in this country to-day. The methods of remedying it are not in the hands of the private woodland owners, because in very few cases have they the finance. Their financial difficulties have been made so great by past Governments, and even the present Government, that they are unable, at the present rates of interest, to shoulder this burden.

I would refer to the figures mentioned by the noble Lord, Lord Wise, who quoted the figures of foreign timber imported into this country. He took his figures from the Watson Report, but I have another paper which may interest your Lordships. It is called, Forestry, Agriculture and Marginal Land, a Report made by the Natural Resources (Technical) Committee, and dated—it is "red hot"—1957. That Report, incidentally, much to my surprise, and, I expect, to the surprise of Members of your Lordships' House, is issued from the Office of the Lord President of the Council. It is not issued by the Minister of Agriculture, Fisheries and Food, or even by the Forestry Commission. The figures quoted are quite different from those quoted in the Watson Report. At the top of page 25, your Lordships will find a summary showing that during the year under review imports of timber, cellulose materials and so on, amounted to no less than £430 million. The figure which the noble Lord, Lord Wise, gave your Lordships was £241 million; therefore in 1957 we have a figure of almost double the amount.

This Report deals largely with the integration of forestry and agriculture. That was a point made by several noble Lords—particularly, I think, by my noble friend Lord Waldegrave. He stressed the importance, especially in England and Wales—perhaps more so than in Scotland—of the integration of agriculture and forestry. This Report, of course, is not before your Lordships' House to-day, but I commend it to the noble Earl who is to reply on behalf of the Government, and to many of your Lordships who have spoken this afternoon.

EARL JOWITT

May I say that we have a debate coming on—I have it down for "No Date Named"—in which I hope the particular topic the noble Lord is now exploring will be before the House.

LORD HYLTON

I am much obliged. Great experts on forestry have spoken this afternoon. I am quite certain that the Government will give all that the experts have said the greatest consideration, because, as has been so often said this afternoon, confidence and stability have not been re-created by the issue of this Report.

6.24 p.m.

THE JOINT PARLIAMENTARY SECRETARY, MINISTRY OF AGRICULTURE, FISHERIES AND FOOD (EARL ST. ALDWYN)

My Lords, we have had a most interesting debate this afternoon—in fact, if I may say so, I think one of the best debates we have had on forestry for a great many years. I can assure your Lordships that everything that has been said this afternoon will be studied with great care by my right honourable friends and also by the Chairman of the Forestry Commission. My right honourable friends have particularly asked me to express to Sir Hugh Watson and the members of his Committee their thanks for the thorough examination and lucid exposition of the problems of the private owner and the timber trade to-day.

Perhaps I should say at the outset that the Government are keeping an open mind at present on the recommendations of the Report, and on other suggestions that have been raised either this afternoon in your Lordships' House or outside, as they have not yet received the formal recommendations of the Forestry Commission, either on the Report itself or on any alternatives. We have had some criticism this afternoon—I am afraid that it is not confined to this House—of what are supposed to be the omissions in the Report. In so far as these criticisms ask for Government action, they do, of course, overlook the Committee's terms of reference which limited their field of consideration to action within the home timber industry; although I appreciate that all the criticisms have not been confined to that, and some of them have embraced the terms of reference and feel that they did not go far enough.

Perhaps I could deal briefly with some of these suggestions for Government action before I go on to say something about the recommendations of the Report itself. The first request for Government action arises from the fears that have been expressed by woodland owners that, should they increase their activities, supplies will mount so rapidly that competition from importers will deny them reasonable prices. They ask that the Government should restrict imports, or at least retain the power to do so, for the benefit of the home producer. I feel that this suggestion rests on a misconception of what it is possible for us to do in relation to forestry under the rules which we, and all the other principal trading countries of the world, have accepted in the General Agreement on Tariffs and Trade. I think, therefore, it may be helpful if I explain briefly what the position is.

We have agreed to rules governing quantitive restrictions, which would rule out the imposition of quota restrictions except for balance of payments reasons. Secondly, we have bound the tariffs on the great bulk of our timber imports from foreign countries, in exchange for concessions by other countries which benefit our exports; that is to say, we have agreed not to increase them unless we are prepared to offer concessions to other countries on other imports or on our own exports. We are, in fact, fully committed as a traditional supporter of the development of international trade on a multilateral basis, and of the rules of good commercial behaviour which are embodied in the G.A.T.T.

While this Agreement does restrict our own freedom of action, it is reciprocal and arises from our paramount need to export our industrial products, upon which rests our economic well-being and opportunity for raising our standard of living. As your Lordships will know, for this we need the greatest number and widest range of markets, and naturally if we disrupt other countries' exports to us they will do the same to ours. This country, which perhaps more than any other lives by its exports, has gained substantial advantages from G.A.T.T., and while we fully appreciate the fears felt by our woodland owners in this matter, I am sure we shall all agree that it would be wrong to risk sacrificing these general advantages in order to secure them immunity from foreign competition.

Several noble Lords, including the noble Duke, the Duke of Buccleuch and Queensberry and the noble Lord, Lord Stratheden and Campbell, have expressed fears about the effect of the proposed European Free Trade Area on British forestry, and it has been suggested that timber and timber products should be excluded, in the same way as is proposed for agriculture. This, I fear, would not be possible. The exception was not intended to cover raw materials for industry of agricultural origin, such as cotton, wool and timber. If we once started to propose exceptions in the industrial field, whether for materials or products, other countries would do the same, and the expanding export opportunities which we hope to secure from the free trade area arrangements would disappear. It is not proposed, however, that any changes under the European Free Trade scheme should be sudden. The intention, as your Lordships probably know, is that the adjustment should be spread over a period of twelve years or so.

The impression seems to exist that G.A.T.T. and European Free Trade, between them, mean a removal of substantial existing measures of protection to this industry. Apart from dollar hardwoods and veneers, there are no quota restrictions on any timber or timber products; imports from Commonwealth countries and pitwood, woodpulp and newsprint from any sources are duty-free. There is, of course, a duty of 8s. per standard, equivalent to one half of one per cent., c.i.f., on sawn softwoods and round softwood, other than pitwood. On softwood box boards and on hardwoods, other than from the Commonwealth, the duty is 10 per cent. On fibre boards it is 20 per cent.

In view of the great preponderance of Commonwealth hardwood imports, and the small duty of about one half of one per cent. in value on sawn softwood, I do not think that the eventual removal of these duties will have any significant effect on the size of the market available to private owners. There is, it is true, some fear that the removal of the 20 per cent. duty on fibre board may discourage the development of what is still an infant industry in this country, and one which can use vast quantities of home-produced thinnings. But I am sure there is no need to adopt a pessimistic attitude on this. Generally, the reason why the home producer of timber has not had a bigger share of the home market to-day is not so much that he cannot compete as that home-grown timber is not available in larger quantities and in an even flow. This applies both to timber of pulping and fireboard size and also to saw logs.

There is welcome evidence, however, that the manufacturing industry is fully alive to the potential output from our home woods. In 1950, out of a total home production of 40,000 tons of fibre building board, 24,000 tons was made from home timber. By 1955, 40,000 out of a total of 50,000 tons came from home-grown timber. Two new mills for the manufacture of pulp, using large supplies of home-grown material, are being built. The Forestry Commission have played, and continue to play, a most useful part in encouraging this development, which I am sure we all wish to see extended. For example, they are seeking specialist advice on the economics of small-scale pulping plants in Britain, in general, and Scotland, in particular.

The Commission take very seriously indeed their duty to promote the extension of existing markets and the creation of new ones. They will continue to pursue these objects energetically, always remembering, first, that to increase the outlets for home-grown timber is in the interests of all three partners in the industry—the private woodland owner, the home timber trade and the State; and, second, that in encouraging new industries—for example, by giving guarantees of supplies in the early years—they must not operate so as to exclude these partners from a fair share in the trade. This is a movement which we should like to see extended, and the Forestry Commission, by giving guarantees of supplies to encourage the setting up of mills of economic size, nave done a lot to assist. They are, however, careful to frame such guarantees so that there is ample room left for private owners to come in as well. If anything can be done to assist sales to existing markets—for example, by the introduction of periodical auctions of timber—the Forestry Commission will, I am sure, use their good offices (if that should be necessary) to bring the growers and the merchants together to work out a mutually agreed system. The Commission, of course, are already arranging experimental auctions of their own produce to see how things go.

My noble friends Lord Forbes and Lord Buckinghamshire asked for help for the grower who was far from existing markets, at least until new markets are created nearer at hand. Remoteness from markets is a problem common to many industries and, while we sympathise with the producer who is handicapped in this way, it is very difficult to single out any one industry for special treatment.

My noble friend the Duke of Northumberland has rightly stressed the great value of co-operative enterprise among private woodland owners. The Forestry Commission are always very anxious to encourage the formation of co-operative societies, and to help them in their early stages with advice and loans or guarantees, where there is evidence of sound commercial footing and adequate local support. However, the essence of the idea is that these societies should ultimately become self-supporting. We regard it as important that societies should be run by the owners themselves, but technical advice will always be available from the Commission's staff, at all levels. I will certainly ask the Forestry Commission to look at the suggestion of the noble Earl, Lord Buckinghamshire—that a senior officer should be appointed in each conservancy as a technical adviser to any new society in its early stages, but I am rather inclined to think that the present more flexible arrangements are perfectly effective and may, in fact, have many advantages. Fears have been expressed by a number of noble Lords that the Forestry Commission, especially in a few years' time, when thinnings are coming from their plantations in large volume, will be able to undercut the private grower, at least in some areas. This I can only describe as an unreasonable suggestion, bearing in mind that the Forestry Commission are charged, under the 1919 Act, "with the general duty of promoting the interests of forestry" and that successive Governments have made it abundantly clear that without prosperous private forests there is no hope of achieving their target of 5 million acres of productive forests within a measurable time. I am certain, therefore, that the Forestry Commission would not deliberately undercut the private owners; nor would the responsible Ministers allow it.

THE EARL OF BUCKINGHAMSHIRE

May I interrupt the noble Earl? I am sorry to do so, but I would point out that the Watson Committee pointed to that matter in paragraph 139 of their Report, which I quoted. The fear of no defence is the trouble. That was the point I tried to emphasise. Can the Forestry Commission and the Minister do anything at all to diminish that fear or to make it disappear?

EARL ST. ALDWYN

I hope that the assurance I have just given may assist in some measure in that respect. My noble friend Lord Dundee raised the question of the Restrictive Trade Practices Act. Some critics—and I think he was one—are apprehensive about this Act and have gone so far as to say that it makes collective bargaining illegal. This is not so. What the Act does is to require persons who want to operate collective agreements to register them, and gives them an opportunity to satisfy the Court that the agreements confer substantial benefits which outweigh any detriment to the public. This means, therefore, that every case will be judged on its merits, and I think it would be very premature to form a judgment at this stage on how any particular agreement would be affected.

I turn now to the recommendations of the Report. Of these the most important by far, in my view, is the recommendation that a strong and effective association of woodland owners should be set up. Though we are, as I have said, at present keeping an open mind on the Committee's Report, I think there is general agreement that, particularly for the small woodland owner, there are many advantages to be gained from co-operation not only in selling but also in planting and management. The Committee were impressed with the lack of that co-operation existing at present, and came to the conclusion that there was a growing need for an organisation of private woodland owners which had full information about its members and their woods and was a national body.

Many noble Lords this afternoon have asked what is the point of this body, and have said that we have plenty of cooperative societies scattered around the countryside. I do not feel that, scattered as they are, they can ever achieve the purpose that, as I see it, the Watson Committee saw their national committee fulfilling. This is really the core of the problem, and I would emphasise to all those concerned with its solution the extreme importance of pressing on at once with the formation of a body competent to carry out the important duties assigned to it by the Committee. The Commission are willing to give any advice and assistance that is needed and in addition are prepared to contribute towards the cost of the new body in its first few years to help it establish itself.

My noble friend Lord Buckinghamshire and other noble Lords have said that they welcome the proposal to modify the membership and status of the Home Grown Timber Advisory Committee. We regard this Committee as a most useful body. Whether the suggested right of appeal to Ministers will be expedient or not is a matter which may require some thought. We shall certainly give the recommendations the serious study they call for.

Equally, a number of noble Lords have talked about maintenance grants. The Watson Committee suggested that the maintenance grant should be increased from 5s. 6d. to "at least 10s.," and that the period during which it is payable should be extended. The case for this and for some simplification of the present grant system, which the Committee also thought desirable, is being examined by the Commission, and the points made by my noble friend Lord Buckinghamshire about the payment of a maintenance grant for approved woodlands and for smaller woodlands will be taken into consideration. At the same time I must repeat that the Watson Committee put the main emphasis on the creation of a strong Woodland Owners' Association and it is in that direction that woodland owners must look for the main solution of their difficulties. The Government would be prepared to consider a request for increased grants provided a good case were made out for them: but we hope and expect that owners on their part will press on with the creation of this potentially valuable—and indeed, I believe, essential—body.

My noble friend Lord Forbes referred I to the present system of paying thinning grants at the rate of £7 10s. divided between the first and second thinnings. He would like to see the grants paid in a lump sum for the first thinning. But the two payments are not in fact instalments and are paid independently at the rate of £3 15s. for the first and for the second thinning. To pay the total of the two grants at once would not encourage the second thinning, which is half the object of the grams. In effect, it would be paying a doubly increased grant for the first thinning without any guarantee or even inducement for the second thinning which is so essential for sound silviculture.

The noble Duke, the Duke of Buccleuch and Queensberry, suggested that capital grants available to farmers under the Agriculture Bill, which is now being considered in another place, should be made available also to forestry. Whatever may be the merits of the proposal that special capital grants should be paid to woodland owners in addition to the existing grants, the Agriculture Bill, which is intended to give effect to part of a general agreement to farmers on long-term assurances, is not the place for it. The system of assistance to woodland owners is contained in the Forestry Acts and it would, I feel, be unfortunate to begin a process of dealing with forestry through the Agriculture Acts.

My noble friend Lord Waldegrave made a number of suggestions. I can assure him that we greatly appreciate anything that can be done to further integration of forestry and agriculture, but I certainly do not know what my right honourable friend's reaction would be to having another "F" put after his name, and I certainly could not commit him in any way at the moment.

EARL JOWITT

Would it matter if there were another "F"? Is not forestry completely under his control to-day?

EARL ST. ALDWYN

My Lords, the position of forestry in relation to the Minister is that the Minister himself is personally responsible for forestry. The Ministry as such have nothing whatever to do with forestry. Strictly speaking, it is the Ministry of Agriculture, Fisheries and Food.

EARL JOWITT

The Minister has complete control.

EARL ST. ALDWYN

Yes; but it is purely in his personal capacity. I believe that the Report contains the seeds of a great improvement in the lot of the private woodland owner. I feel, too, that there are substantial grounds for confidence in their future. I hope that what I have said will reassure private owners, and show that the fears expressed about the economic future of the private producer have been exaggerated. There is a vast market, and the fact that only somewhere between one-eighth and one-tenth of our present requirements of timber and timber products are produced at home should be a challenge to further effort.

I am confident that as production expands and a more reliable supply of timber becomes available, so will the trade be anxious and willing to absorb it. After all, what has hampered sales up to now has been the "penny packets" that are offered, coupled with the uncertainty of supply. Ministers of both political Parties have made statements on this subject. Mr. Tom Williams said, on July 28, 1949, that His Majesty's Government recognised that a healthy and stable forestry industry is an essential part of the national economy, and that he proposed to review the economics of British forestry, at intervals, in consultation with woodland owners and the timber trade. Sir Thomas Dugdale, on December 5, 1952, said [OFFICIAL REPORT (Commons); Vol. 508, col. 1965]: The Government fully recognise the need for a healthy and stable forest industry. Both the private woodland owner and the Forestry Commission have their part to play. Now, in addition to those statements, I am authorised by my right honourable friends the Minister of Agriculture, Fisheries and Food and the Secretary of State for Scotland to reaffirm, on behalf of Her Majesty's Government, their confidence in the future of private forestry, and to say that Her Majesty's Government recognise the importance, in the national economy, of a stable and efficient forestry industry, and the essential and substantial part which private owners have to play in that industry. It is their desire that there shall always be available to the efficient producer adequate opportunities for the marketing of his timber at reasonable prices.

6.55 p.m.

THE EARL OF BUCKINGHAMSHIRE

My Lords, before I ask leave to withdraw my Motion, which is my intention, may I thank the noble Earl, Lord St. Aldwyn, for his answer and for the reassurance he has given us on forestry in saying that Her Majesty's Government do intend to make sure that the industry remains a firm and stable one. Unfortunately, I do not feel that the other assurances he has given us are very strong. Negotiations are still going on between the United Kingdom Forestry Committee and the Forestry Commission, and possibly that is one of the reasons why the noble Earl was not able to give us a fuller answer. If that is so I can understand it. None the less, we can be grateful to him for his assurance.

May I take this opportunity of thanking the very large number of speakers who have supported me in this debate. I am extremely grateful to all of them. I must mention one particular point which, though I did not refer to it in my opening speech, has been mentioned by several noble Lords and by the noble Earl in his reply; that is, the question of European trade. The noble Earl said that it was not possible to exclude timber. I know that a large number of noble Lords and many woodland owners will be very disappointed at that answer. I am glad to know that the Forestry Commission are anxious for the creation of new markets wherever they can be found, and I believe we may rest assured that woodland owners will do all they can to support the Commission in this matter. It is obvious that Her Majesty's Government are going to press us to form the Woodland Owners' Association, though apparently they leave it to us to how we should do so. May I express my gratitude to the noble Earl for telling me that the points which I made about grants will be considered, and also for mentioning that there will be consideration of my suggestion with regard to advisers for co-operative societies. May I express the hope that this debate will have done a great deal of good, and that the negotiations now being carried on will come to successful fruition. I beg leave to withdraw my Motion.

Motion for Papers, by leave, withdrawn.