AGRICULTURE (SMALL FARMERS) BILL

HL Deb 05 February 1959 vol 213 cc1196-262

3.53 p.m.

Order of the Day for the Second Reading read.

THE JOINT PARLIAMENTARY SECRETARY, MINISTRY OF AGRICULTURE, FISHERIES AND FOOD (EARL WALDEGRAVE)

My Lords, the Bill I am introducing to-day is short but important. It is an enabling measure under which schemes can be made to give effect to the proposals set out in the White Paper, Assistance for Small Farmers, published rather more than three months ago. In introducing this measure I have set myself two tasks. I wish to explain the clauses of the Bill—apart from Clause 3, which applies only to Scotland (my noble friend Lord Forbes will deal with that clause)—and, perhaps more important, to explain also the nature of, and need for, the schemes we propose to make. But before I go through the proposals in detail, I should like to say a few words about their place in the Government's agricultural policy.

This measure is one of several designed to give British agriculture permanent stability, and to improve its economic position. We have already had the long-term assurances; we have improved the landlord-tenant relationship; and we have introduced the great modernisation plan for farm buildings. Much has been done: but there remains the problem of the large number of small farmers who still find it hard to make a reasonable living. Many so-called remedies have been proposed. At one extreme it has been suggested that there is no place in modern agriculture for the small family farm, and the solution proposed—compulsory amalgamation; doing away with such units—is reminiscent of "the shortest way with Dissenters". That solution, we believe, is not acceptable in this day and age in a free country, and has been firmly rejected by the Government.

At the other extreme, it has sometimes been suggested that the small farmer should be given help by way of differential prices or subsidies. We have been pressed to persuade the Milk Marketing Board to reintroduce the small producers' bonus; or to increase the deficiency payment on the first few acres of cereal crops; or to raise the fertiliser subsidy for the first few tons purchased. But, my Lords, none of these suggestions is, in fact, a practical way of helping the small farmer. It would be administratively impossible to prevent such differential payments from going to all farmers, large or small, who produced or used only a small amount of that particular commodity. Many large farmers produce only a little milk or grow only a little barley. On the other hand, not all small farmers would benefit from such a scheme. Probably less than one-third grow barley at all, and less than two-thirds grow oats. Not all produce milk. An even greater objection is that any arrangement of this kind would make no permanent improvement in the small farmer's position. It would, in fact, be no better than a dole—and a dole which would not necessarily go to those most in need.

Now, my Lords, how have the Government approached this problem—a problem which all Governments have recognised, but none, until now, have tackled with a workable plan? Our approach has been as follows: First, we had to define the unit. What is a small farm? Who is a small farmer? What measuring rod should be used? Second, having defined or identified those for whom the assistance was required, how, in fact and in detail, should we help them?

In considering the first question, "What is a small farm?", we have concentrated attention on the farm as a business. We sought a definition of the size and kind of farm business to be helped which would be administratively workable and which the farmers themselves would accept and understand. We propose to use a measuring rod which, by taking both acreage and labour requirements into consideration, will enable us to identify the small farm business which needs assistance. Acreage alone is not enough: a very small acreage can be very profitable, and constitute quite a large business, if the production is highly specialised and intensive. These are not the farms we are looking for.

Then there are farms where the acreage is so small, or the land is so poor, that they can never provide a reasonable full-time living, no matter how hard the farmer works. Many such farms are, in any case, part-time occupations. This class, the non-viables, as we call them, is again not what we are looking for. For, my Lords, it is our policy to encourage economic production rather than production at any cost. We are trying to build an agriculture which is fundamentally sound and healthy: one which can stand on its own feet, and not merely survive but thrive. We are not justified, therefore, in providing special assistance—beyond the assistance which all farmers already receive, large or small—in order to maintain businesses which are fundamentally uneconomic.

But there is a third group of small farm businesses. These are the farms which may, at the moment, not be yielding a very good living but which we believe could do so if they could have financial help and technical advice. We aim to provide just that. The basis of the small farmer scheme is to provide cash grants to those farmers who are running basically economic small businesses, and who agree to carry out approved plans for improving these businesses.

My Lords, I want to draw particular attention to the dual nature of the assistance we propose to give. Just as the farm is to be measured in relation to both its size and its labour requirement, so the assistance will be given not only in cash but in a new plan of operations. It is not simply a question of measuring up to the eligibility standards and then drawing your money. You have got to propose and have accepted an improved plan of farming, and the grants which will be paid in instalments are dependent on the approved plan being actually carried out. It is my firm belief that this advisory aspect of the scheme will be of even greater value, in many cases, than the actual cash grants. The central feature of this advisory aspect will be the preparation of an improvement programme for the farm business. This will be a plan spread over three to five years, showing how the economic position of the farm business can be improved.

In drawing it up the farmer will, of course, have the help of the National Agricultural Advisory Service. Indeed, for many small farmers one of the most valuable features of the scheme will be the help that the N.A.A.S. officers will give them to look at their farms as business undertakings and to work out how they can be adapted to yield greater profits through better management. Once the programme has been approved, farmers will, of course, still be able to call upon the N.A.A.S. for technical advice. We have a very fine Advisory Service indeed in this country, but it is unfortunately the fact that, for a variety of reasons, it is just these small farmers who sometimes in the past have been a little reluctant, who have hung back from approaching the N.A.A.S. officers and benefiting from the advice which they have to give.

This is the key to the whole operation. This is why I can commend this proposal to your Lordships with such confidence. This is no indiscriminate dole to all and sundry; it is a method of deploying our resources of money and technical advice to lasting effect in a sector where these resources are much required and where they can do much good. Once the farming plan has been agreed, and the money has been given to make the carrying out of the plan possible, we are confident that we shall have put this small farm business on a lasting sound basis.

My Lords, I will turn back for a moment to the question of measurement or definition of the small farm. I referred to the two tests for eligibility under the scheme. There is to be an acreage test and a test based on standard labour requirements. The farm business must have not less than 20 and not more than 100 acres of crops and grass—rough grazings are excluded. At the same time, the farm business must require not less than 275 standard man-days after—I emphasise the word "after"—it has been improved under the scheme: 20 to 100 acres actual; minimum 275 man-days potential. The top limit must be not more than 450 man-days at the time application under the scheme is made.

At first sight this is a little complicated. What do we mean by "standard man-days"? First, let me make it quite clear that it does not refer to the number of men a farmer actually employs. It does not mean that 450 man-days means one full-time workman and another workman for part of the year. Nor does it mean that a farmer working on rather difficult land, perhaps on a rather scattered farm, will be excluded because he requires more labour than his next-door neighbour with a more compact or more easily worked holding. What we have done is to take from farm management surveys the requirements of manual labour needed on average for the production of the different kinds of crops and livestock. These requirements are expressed in standard man-days. An acre of wheat requires 3½ standard man-days each year, a dairy cow needs 15 standard man-days, and a beef cow, 4½, and so on. Thus "man-days" are simply a way of using a common measure for the crops and stock on a farm so that we can compare, say, a dairy farm with an arable farm. In fact, we take the actual acreage, and then translate the crops and stock into notional standard man-days. The result is we have the size of the farm business. I should like to say that although this may appear technical and complicated to your Lordships, it is a technique understood and accepted by the farming community. They are used to this system of expressing labour requirement.

I have attempted to explain how we intend to define, or measure, small farm businesses which are to be helped. I must turn again to the nature of the help we propose to give. There will be two kinds of cash grants to those who qualify for the scheme and who carry out an approved programme of improvements. The two grants are complementary, not alternatives. First, there are what are called field husbandry grants. There are four of these. I hope I do not weary your Lordships with all these subdivisions, but I believe that it may be of interest to go into a certain amount of detail at this point, though this is all set out in the White Paper.

The four kinds of grant are: a grant of £9 an acre per year for up to three years for the improvement of land which has been under grass for at least three years; a grant of £9 an acre in all for the renovation of any grassland without ploughing; a grant of £1 a chain for any ditching work necessary in connection with grassland improvement or renovation; and a contribution to minor reclamation work essential to the improvement programme. These grants will be paid as the work is done. They are in addition to any other grants and subsidies attracted by the work, such as the ploughing grant and the fertilisers subsidy. These are all set out in Appendix II of the White Paper.

The second form of grant is the farm business grant. Your Lordships will find it explained in paragraph 10 of the White Paper. It will not be paid for any particular item or operation, but for satisfactory progress on the approved programme as a whole. It will be at the rate of £6 per acre of crops and grass, with a maximum of £360, and it will be paid in four equal instalments at intervals of 6, 12, 18 and 30 months from the start of the approved programme. Clearly, it would be imprudent to pay the whole sum at once at the start of the scheme; and on the other hand, to hold all the money over till all the work was done would tend to defeat the object of the scheme.

The total limit of the two grants—field husbandry grant and farm business grant—will be £1,000. I would emphasise that these are out-and-out grants, not repayable loans. We believe that these grants, coupled as they are to the N.A.A.S. advice and the improvement plan, will enable the recipient to become more creditworthy so that he will be able, if he so wishes, to raise additional finance in the normal manner.

For the benefit of those small farmers whose applications cannot, for a variety of reasons, be dealt with at once we propose to give assistance while they are wailing. In England and Wales and Northern Ireland this assistance will be given under what we have called the Supplementary Scheme. It will take the form of special grants supplementing payments made under the existing schemes for ploughing up, liming, ditching and the supply of fertilisers. No programme of improvements will be required. This Supplementary Scheme has a second object—to give transitional assistance to some of those farmers who have been benefiting from the Marginal Production Schemes in the past but who will not be eligible for the Small Farmers Scheme.

Before I turn to the text and clauses of the Bill, I should like to say something about the relationship between the Small Farmer scheme and the Farm Improvement Scheme, and also about how the Small Farmer Scheme will affect landlords lard tenants. The improvement programme under the Small Farmer Scheme is to be related to the responsibilities of an occupier. It cannot include additions or improvements to buildings and other equipment. No doubt, however, there will be cases where the success of a particular programme put forward by a small farmer would be dependent upon new or improved fixed equipment. Where this is so, we shall, of course, consider whether the proposed fixed equipment would be acceptable for grant under the Farm Improvement Scheme—that is, under the 1957 Act. It will not automatically be eligible. The Small Farmer Scheme is concerned with increasing the profitability of the farm business. The Farm Improvement Scheme is concerned with long-term improvements to the land. The requirements of these two schemes must necessarily be different.

Your Lordships know that a tenant requires consent before carrying out improvements to fixed equipment. A tenant is not, of course, absolved by this Bill from obtaining consent, either in respect of buildings or, for example, in respect of ploughing up permanent pasture where there are restrictions in his tenancy agreement. The Small Farmer Scheme, I would reiterate, does not affect the relationship between a tenant and his landlord. It will not confer any extra rights on the one, nor will it confer any additional obligations on the other. The law remains the same. Where a landlord receives a request from his tenant in connection with a proposed improvement programme, I hope that he will convey his decision to the tenant promptly, so that his tenant is not unduly delayed in taking advantage of the scheme. Where the landlord is unable to agree to the request an improvement programme will have to be drawn up on the basis of the existing buildings and fixed equipment or having regard to any restrictions in the tenancy agreement.

LORD STONHAM

My Lords, perhaps the noble Lord will allow me to intervene before he leaves that point. He mentioned that where expenditure under the Farm improvement Scheme was necessitated by an approved small farmer scheme, it would not be automatic. Does that mean that if the small farmer's income did not warrant expenditure under the Farm Improvement Scheme the scheme could not go through?

EARL WALDEGRAVE

I do not think it could be put quite so briefly as that. The criteria for acceptance of a scheme under the Farm Improvement Scheme are known and it would have to be judged on its merits. If a scheme is not eligible for the Farm Improvement Scheme, it cannot be accepted under the Farm Improvement Scheme. The point I am trying to make is that where a tenant works out a system for his farm improvement and puts in something to do with the buildings, and then he gets up against difficulty and finds he cannot do it, we hope the landlord will tell him quickly so that he can work out a new scheme. But these two schemes must be worked independently.

I will now turn to the text of tile measure now before your Lordships' House. While the Bill considered in isolation may be a little difficult to follow, it is not so when it is related to the White Paper. Before I turn to Clause 1, let me explain a point in Clause 6, also referred to in paragraph I of the Explanatory Memorandum, which has caused some confusion among people who have looked at it. Noble Lords may have been puzzled to find that in Clause 6 the small farm is defined as being up to 150 acres, when I have said, and the White Paper says, that 100 acres is the limit. The reason is that farmers farming up to 150 acres, who have been getting marginal production assistance, will be eligible under the supplementary scheme, and the Bill has to cover this as well. The 100 acres limit will, of course, be in the small farmer scheme when it conies before your Lordships.

Clause 1 is the enabling provision for the Small Farmer Scheme in the whole of the United Kingdom. Subsection (1) requires grants to be related to an improvement programme. Paragraph (a) of this subsection limits assistance to viable farm businesses. In other words, this is the authority for the lower limit of 275 standard man-days after improvement. Perhaps I should make it clear that this clause does not confine the Scheme to full-time farmers as has sometimes been thought. The test is that the farm business must be capable of giving full-time employment. In practice it would not matter a bit if the farmer worked part-time and had other part-time or full-time help—from a relation, for example. Paragraph (b) provides for operational grants, that is, the field husbandry grants, and for general grants, that is, the farm business grant.

Clause 2, which relates to England and Wales and Northern Ireland, provides for the Supplementary Scheme. It limits assistance to those eligible for the Small Farmer Scheme and to former marginal producers, and provides that assistance to the latter shall cease on 1st July, 1962. It also lists the individual grants and subsidies that may be supplemented. My noble friend Lord Forbes will speak on Clause 3, which relates to Scotland.

Clause 4 contains supplementary provisions. Under subsection (1) programmes may be submitted for consideration under the Small Farmer Scheme before the Bill becomes law. As your Lordships will be aware, applications were, in fact, invited on and from 15th January, and I think it is of considerable significance and interest that we have already had 3,000 applications in a fortnight. At a first look at them it seems as if 85 per cent., and perhaps 90 per cent., will be eligible. Subsection (2) (a) is the authority for prescribing limits of acreage and standard labour requirements in any of the schemes, apart from the lower limit of 275 man-days for the Small Farmer Scheme. The upper limit of acreage may not exceed 150 acres, the figure laid down in the definition of "Small farm business" in Clause 6 (1).

Clause 5 sets out the procedure to be followed if it is desired to revoke approval of a programme under the Small Farmer Scheme because work is badly done or has been unreasonably delayed, or because the programme is unlikely to be completed. I am sure we all hope and believe that it will very seldom be necessary to invoke this clause but it is an essential provision. It both safeguards public money and also ensures that a small farmer has an opportunity of putting his case if he is aggrieved by the Minister's decision.

My Lords, I have now completed my review of the objects of the Bill and of its detailed provisions. The Government do not claim that they have necessarily said their last word on the small farmer problem. If experience shows that changes are needed, we shall make them. The Bill is deliberately drawn in wide terms so that—subject to Affirmative Resolution—we can make changes in the Scheme if changes are needed. But we think we are starting out on the right lines because we are aiming at the root of the problem. The small farmer has not always been able to take advantage of the latest technical and scientific achievements in the same way as his larger neighbours. We are now offering him the chance to do so, and thereby to improve his business permanently. We are offering him an invitation to examine his business afresh and to seek the best advice. We are enabling and encouraging him to accept the invitation by offering capital grants. This Bill is therefore a serious attempt to improve the economic and competitive position of an essential part of our agricultural economy—it deals with an old problem in a new way. As such I commend it to your Lordships. My Lords, I beg to move that this Bill be read a second time.

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

VISCOUNT ALEXANDER OF HILLSBOROUGH

My Lords, I do not think we have been given a detailed explanation of the exact manner in which the Government propose to finance this grant.

EARL WALDEGRAVE

The exact manner in which the Government propose to finance this scheme is set out in the White Paper, and perhaps I could reply to the noble Viscount after he has made his remarks on any points that are not clear to him.

VISCOUNT ALEXANDER OF HILLSBOROUGH

I understand that all the sums spent out of the public money referred to in Clause 7 are to be taken into account in axing ultimate prices to all the farmers, and not merely to those who have received the grants.

EARL WALDEGRAVE

I am sure the figures are familiar. We consider that the annual cost of these schemes will be £9 million and this will be, as it were, debited: will come within the Price Review. But £3 million will be saved by the ceasing of the marginal production grants and this saving will be credited to the farmers at the Price Review. Then there will be £3 million which we think will be attracted by the increased use of the ploughing up grants, fertiliser subsidies and so on, and this additional expenditure will be outside the Price Review.

4.22 p.m.

LORD WISE

My Lords, I am glad to see that in connection with the Small Farmers Bill many noble Lords have expressed a desire to speak. It is significant that many of them come from over the Border. It is obvious that conditions among the small farmers over the Border must be parlous indeed, and I hope that to-day noble Lords will plead the cause of the small farmer from that part of the country. The Minister said that the Bill was a little complicated, although in another phrase he said that everything was quite simple. He also referred to the Memorandum which has been published, which he said might not be understood by some noble Lords but was really very simple and could be digested by the farmers, or words to that effect.

EARL WALDEGRAVE

My Lords, I hesitate to interrupt, but I was not referring to that Memorandum. I was referring to the Explanatory Memorandum on the outside of the Bill.

LORD WISE

I beg the noble Earl's pardon I thought he was referring to this perfect treasure of a document. I do not know whether noble Lords have received or obtained this particular pamphlet, but it deals with the schemes and also covers the application form by the small farmer for the grant. I shall deal with that later on, but it is something which I think is quite beyond the comprehension of those particular people who have to study it and fill it in. I foresee that a great deal of time will be spent by district officers and others in explaining what the Government really mean and what they intend to do.

I thank the noble Earl for the full explanation of what he said was a short Bill. In describing it I think he was guilty of a masterpiece of enthusiam for it. It is no doubt a short Bill, but from the Government point of view I suggest that it has been a tiresome Bill, because although short it has had a cool reception from members of the farming community and the National Farmers' Union. Within my scope I have seen only one reference to it by a member of the National Farmers' Union in words of praise, or suggesting that it should be given a trial. In effect, the Government have had rather a severe caning in connection with the Bill, both outside and in another place. It is not my intention to add too greatly to the troubles of the Government in respect of the Bill, although I cannot commend the provisions except in one particular. I am glad to hear from the noble Earl—and the Minister himself said so in another place—that if necessary the Bill could be amended after a reasonable period of operation. I hope that that will be the case, and that what comments are made in your Lordships' House to-day will be brought to bear in any amendment which may be put forward in the months ahead.

The Bill had a careful consideration in another place, and I congratulate the Minister on accepting a number of Amendments. He did not accept all of them, and later on I hope that we on this side of the House—although it is a certified Bill—will be able to table some Amendments which we think are necessary. I hope, therefore, that, whatever may be the outcome of this afternoon's discussion, noble Lords will give their comments freely on the Bill with a view to improvements, if improvements are necessary, at a later date.

It is a short Bill in length, and in my view it is very small in its benefits. It lacks generosity to those whom it seeks to assist, and by reason of certain omissions it is ungenerous to those small farmers who are left out of its scope. There was a question by my noble friend on this side which was answered by the Minister, in reference to the farmers who cannot come in either the Farm Improvements Scheme or the Small Farmers' Scheme. It seems to us on this side of the House that there may be thousands of farmers who come within that category. It is a penal Bill. It levies a toll—although this came out only by the question and answer at the end of the Minister's speech—upon the industry as a whole to subsidise a certain section. The Minister referred to the particular levy in part of his speech as "our money". What does he mean by "our money"? It is surely the farmers' money; the farmers themselves are supplying the money, and not the Government.

EARL WALDEGRAVE

My Lords, I hesitate to interrupt, but really this is taxpayers' money. The £1,200 million, or whatever it is, of the farm guaranteed prices is the guarantee that the Government give, and the cost of the subsidies, £250 million or £300 million, is taxpayers' money.

LORD WISE

It is taxpayers' money and it is money which the farmers would spend in other directions if it were not levied from them under this Bill. In my view, it is an admission of defeat on the part of the Government in their attempt to bring the agricultural industry up to a proper standard of prosperity; it is an admission of failure on the part of the Government to stabilise and secure profits for all engaged in agriculture; and it admits that under Government policies it is impossible for a small British farmer in present circumstances to obtain a livelihood from the land. It must be a condemnation that in present times the primary producers of food have to suffer the indignity of small grants and other reliefs in order that they and their families may live. It has been proved that small farmers cannot make ends meet, and that is a condition which I think should not arise in British agriculture or British food production. Good honest work on the land deserves fair and just rewards for all, and British agriculturists and horticulturists are not receiving their fair share at the present time. I referred a moment ago to the question of provision by the industry of money for the alleviation of the losses of a small section of it, and I want to ask the Minister whether that sort of condition prevails in any other of our industries. If so, would he be prepared to give the House information as regards the industries in question?

I believe this Bill would have been unnecessary if full operation of the provisions of the Agriculture Act, 1947, had been carried out by the Government. Guaranteed prices and assured markets are things of the past and have become myths and delusions. Amid the present chaotic and uncertain agricultural marketing and trading, violent fluctuations and corn and stock price manipulations still operate. It is difficult enough for a large farmer to keep his end up, but for the smaller farmer it is just impossible under present conditions. I have raised this point (and I make no apology for raising it again) in regard to market prices and assured markets because I think the policy of the Government is wrong and I want to call particular attention to it. I challenge the Government—and here I use a phrase which is known to the Government—to stop the hole in the purse of the farmer, to control the ever-rising costs which he has to face, and to assure to all our primary producers fair and just prices—and here I want to stress my particular point—from the first purchasers of our commodities and products; not from the Government, but from the first purchasers of our commodities and products.

This limited, measuring-rod Bill, if I may repeat what the noble Earl said, is a peculiar, unpractical, arithmetical exercise in standard man-days, with their decimals and fractions. The noble Earl has referred to the decimals included in the figures which are set out in the application form. The one which strikes me as being the most comical of the lot is the decimal 0.01 for the broilers. Can you imagine the farmer and his wife working out, by lamplight probably, how many broilers they are allowed to have on the farm or how many little pigs they are allowed to have at .06, or whatever it is? It strikes me as being rather a peculiar way of suggesting to the farming classes they should work out their application forms.

I want to deal briefly with a few details of the Bill, and the first one I come to is obviously the farm business grant. This will not, in my view, carry the small farmer very far. It is essentially a stock-increasing grant, but spread over three years the small head of stock bought with the first instalment, which is not very much, may be dead, sold or depreciated in value before the other instalments at the twelve months, the twenty-four months and the thirty-six months are received, and losses of other stock may also have occurred on that particular farm. You cannot carry on a farming enterprise by rule of thumb. You are bound to meet losses, illnesses and difficulties.

The Minister in another place set his face against loans to farmers. I should have thought a scheme combining loans and grants would show a better individual and national result. It is no compliment to agriculture for it to be suggested that if leans were granted the Government would never see the money back. This doubts the credit-worthiness of the farming industry. And here may I say that what is good enough for the steel industry by way of grants is not too good for the agricultural industry. A loan of £50 million to a steel firm and nothing to farmers calls for comment. Food is no less important than steel. We have survived in the past without steel, but not without food, and food will always be for us our greatest need arid first priority.

The provisions of the field husbandry grants form the best part of the Bill. I believe very strongly that much of our land needs improvement and can be improved by adequate treatment and knowledge. The ploughing and other field husbandry grants are helpful, and if the fertility and use of land is increased they will have served a good purpose. Supplementary grants also show a measure of helpfulness, but I much regret that many small, enterprising farmers will have to remain out of the two schemes by reason of their past ability in raising and establishing very productive levels.

Whilst I am mentioning those outside the Bill, I should like the Minister to consider the position of those young and other farmers who have just taken over their farms, or are about to do so. So far as they are concerned, their farm business has no personal background or basis on which it can he judged for grant purposes. The farms taken over may be poor; they may be let down or neglected. If entry takes place next Michaelmas, the Bill will already be in operation as an Act. Here perhaps the Minister will be able to guide us later on. Have these new entrants to wait until they have established dairy herds, sheep flocks, pigs and poultry, carried out cropping programmes, know the measure of their labour employment, and have had one or two years' working of the farm behind them, or can they be brought in at their point of entry to the farm—that is, when they first take it over—when money, advice and assistance would be most gratefully received and of value?

Now I come to the position of the statutory smallholder. I do so because this was a point which was raised in Standing Committee in another place by my old and greatly respected friend, Sidney Dye, a few days before he met his accidental death. The Joint Parliamentary Secretary of that time was unable to give a ruling but promised that a letter would be sent to my honourable friend. This is a matter which may affect many smallholders in Norfolk, and I have thought it desirable to raise it again in order that information may be published, if that has not yet been done. I am sure the matter was raised in the first instance so that the smallholders concerned might know their position under the Bill. It was said that 1,225 advances, amounting in all to £1,119,000, had already been made to the smallholders concerned, but here I would make the point that these appear to be loans and not grants.

My Lords, I have dealt with only one or two points arising on the Bill. I do not think we can establish a really prosperous agriculture in this country by a series of small measures. If I may put it in this way, the root of the evil is far beyond the one or two measures which have been introduced. I think the whole question of the prosperity of agriculture, its marketing conditions and other things, should be seriously considered at an early date and dealt with on a comprehensive basis. I hope that, as I said a moment ago, we shall be able to suggest some small Amendments, and that we may be able to improve the Bill before it leaves your Lordships' House.

4.45 p.m.

LORD AMHERST OF HACKNEY

My Lords, I welcome this Bill because I feel that it is an attempt to solve what is both a social and an economic problem—namely, the problem of the small farmer who in many cases is lacking the capital, and in some cases the technical knowledge, to run his farm as economically as it could be run. The Bill is merely an enabling Bill and gives wide powers in regard to schemes to help farmers farming up to 150 acres, and also to amend those schemes. I propose to devote most of my few remarks to the schemes themselves. I feel that it is right that, by a mixture of financial assistance and advice, we should try to help these people, and that in many cases the advice may be just as valuable as the cash, if not more valuable.

This is a problem which is neither new nor in any way confined to this country. I remember that some years ago I was looking round farms in Czechoslovakia where there was a system by which the prices of the products were based entirely on the acreage of the farm. I do not think that a system like that is either a fair one or would work in a reasonably free economy: acreage by itself obviously cannot be the criterion. I think that the present scheme is an extremely ingenious attempt to meet this problem. I have heard little criticism of this method of classifying farmers—at any rate, I have not heard anybody who has recently seriously produced a better one. But I am sure that this scheme will provide a number of "headaches" for both district officers and members of agricultural executive committees, particularly when they have to decide what was the usual cropping of a farm; because cropping can vary considerably from year to year, and on it may well depend the eligibility or otherwise of the person for grant.

But the chief criticism of the scheme seems to me to be whether it goes high enough and includes enough people, or whether it goes low enough, and also who is to pay for it. I personally should not go to the stake on the issue of whether the lower limit should be twenty acres or fifteen acres, or whether the top limit should be 100 or any other number of acres. I think that at this stage one must have a definite limit, and one which can be clearly understood by everybody, because great interest is being taken in this scheme. As your Lordships probably know, meetings have been held, run by the Ministry on something of a district level, and the response has been extremely good. The noble Earl has quoted the global figures of the applications received, and in a county which I know the response has been extremely encouraging.

The noble Lord, Lord Wise, criticised this document which sets out the scheme. He pointed out, quite rightly, the difficulty of the various calculations. He talked about the decimal points. But, of course, he knows as well as I do that for anybody who cannot work in decimals the fraction is written beside it, so that if one can do either fractions or decimals one can get "home and dry" on this.

LORD WISE

My Lords, what if one cannot do either?

LORD AMHERST OF HACKNEY

My Lords. I think if one cannot do either one would probably not be among these small farmers. Out of a considerable number who took away these application forms—and this scheme has not been going very long—one-third have already done the sums and returned the forms. So evidently they have not found it an insuperable difficulty, particularly having had the explanations of the district officers. I believe that that is a very important thing, and that these meetings should be held in the smaller districts, parishes and so on, so that farmers can get together and so that the scheme can be explained to them. If that is done I do not see why we should not be able to get these forms filled in reasonably correctly.

I am sure we must have these limits, however, because otherwise the Ministry will be completely overwhelmed; and if, as I think most people agree, the advice is as important as the financial assistance, then we cannot do these schemes in a hurry. It is bound to take a considerable time. Moreover, we do not want to keep applicants waiting a tremendously long time for their schemes to be dealt with. I am sure, therefore, that it is right to have a fairly rigid limit, anyhow to start with; then, when one sees how the scheme is gains:, there is nothing in the Bill that I know of to prevent the scheme from being widened either up or down. We want to see to it that the Ministry officers are not completely overworked. As to who is to pay for the scheme, I think we have to look at this question with a little sense of proportion. We are now dealing with a sum of about £6 million on total guarantees of nearly £1,250 million—not a tremendously high figure; and really, every time we alter the price of one commodity or another we take from one farmer's pocket and put into that of another. I feel that this scheme may do a tremendous lot to solve this very difficult problem, and it is encouraging that, in spite of some criticism of it, the National Farmers' Union are determined to do all they can to see that it works. I feel that before we start criticising it in great detail we should give it a chance and should see how it works.

4,55 p.m.

VISCOUNT ALEXANDER OF HILLSBOROUGH

My Lords, I am not going to address your Lordships at any great length, partly because I feel I have not the right to do so as I cannot stay to the end of the debate and it is not fair to a Minister to make a long speech to which he replies when the one who has made the speech is not present; and I have another engagement. Also I hope that we shall have an opportunity of dealing in the Committee stage of the Bill in this House with one or two matters which we feel were not satisfactorily dealt with in the other place. It has been suggested that as this is a certified Bill that may not be thought possible, but that is not our view, after having examined the matters in question and the clauses in the Bill. At any rate, we will put it to the test and put Amendments down for the Committee stage.

As regards the general reception of the Bill, I fully agree with my noble friend Lord Wise that it has been exceedingly mixed, to put it at its highest. From the point of view of the farmers who are not in a very flourishing state of life with farms of from anything from 300 acres down, the kind of treatment which Her Majesty's Government propose in this scheme to mete out to small farmers is not at all popular. It may well be that in the case of farms of 1,000 acres and more, organised on a very high machinery basis, the possibility of making some contribution on any prices they might receive could not be ruled out, if we could find a way to do that equitably.

In this case, however, while it is felt by Her Majesty's Government that the rest of the intermediate state of agriculture is so much in need of help that they continue a system of guaranteed prices and, on top of that, add further aids in respect of ploughing and similar grants to all those other farmers because they really need it, Her Majesty's Government will now charge back against the Annual Price Review—against the farmers' interest—these grants which have been made. If I understood the noble Earl the Minister aright, he said that the ploughing-up grants, for example, are not chargeable against the Review of Prices and that they are not taken into account; yet all the grants under this White Paper will be so charged. To take an example which was explained to your Lordships this afternoon by the noble Earl, there is a grant towards the improvement of, say, grassland. Under this scheme we then get a grant up to £9 an acre which is to be in addition to the £7 or £7 10s. per acre under the normal ploughing-up grants system; we are therefore to have a total of just over £6 for the improvement of grassland in the case of the small farmer. I should have thought that upon all the experiments carried out by the county agricultural committees those grants would surely be on exactly the same ground as the ploughing grant is given and that therefore those grants, or at least those on the lines that I have mentioned, would certainly not he reckoned in the actual Review of Prices.

From that point of view Her Majesty's Government have attempted, though I do not think they have succeeded very well, to put over to the farming community that here is a great measure of aid and support for the small farmer which is to be provided out of general funds provided by the Government. That is the sort of impression which it was intended to convey, and of course that is not the real position at all.

I should like to support very much what my noble friend Lord Wise said about the real remedy for the situation, in addition to the old scheme already in operation, which would have been to prevent the return to a free market in the sale of farm produce and to provide guaranteed prices in connection with a control—a control which would not only operate in the grading and fixing of prices of the market but also give some guarantee of bringing fairness into the price paid by the consumer. I do not think it would require a very close examination to show that the people who have been engaged in the distribution of many of the farmers' products have done very well—very nicely, thank you!—since the reversion from the general scheme that was being followed under the 1947 Act.

The other thing which is so extraordinary in dealing with the small farmer in this matter is the lack of his contact with the markets, compared with that of the very large farmer who, if he has capable deputies on the farm, can give some part of his time to visiting the markets and testing them all for himself. The uncertainty in the market since the change has taken place has put the small farmer in a much more difficult position than he was in before. I have heard that fact from many of the smaller farmers with whom I have discussed the matter. At times, a farmer, say in my neighbourhood, is accustomed to sending pigs off a holding which certainly is not thirty acres but is less than thirty acres, into a local market, and he cannot tell what price he is going to get. The present system of guaranteed prices is not really bringing a return to keep up with the increased costs the farmer has to pay.

Let us consider a farmer with a holding of up to 150 acres. I should like to be clear whether I have correctly understood the Minister in believing that the 150-acre figure is put in only for the supplementary scheme. Consider generally the scheme for a farmer with up to 100 acres, and where in different types of holding that would comply more with the character of his programme of production—so much dairy, so much arable, and so much concerning other special parts of the programme. That farmer would require the labour of three to four men; and he will be pretty well ruled out. In all these cases the farmers have had an increase in costs which is pretty significant. For a farmer who farms 100 acres and who has a milk herd attached to it the costs of production of milk in the last seven years have risen very considerably indeed. Wherever paid labour is involved, then the costs have risen considerably. The farmer is not going to get the advantage out of this scheme which is really forecast by those who have commended it to Parliament and to the public. I do not propose to say more at this stage. I want to have a look at the Amendments we are putting down and perhaps to say something further on the Committee stage of the Bill. But, so far as I am concerned, I am absolutely unconverted from the view that if you follow persistently the basis of the scheme of the 1947 legislation you can deal with many of these things that are now required to be done.

There is one other point which I should like to make. I hope it may be possible during the passage of the Bill for a noble Lord speaking for the Government to indicate exactly how this will affect the position between the small farmer tenant and his landlord. I am very glad to see the noble Viscount, Lord Bridgeman, in his place, because he knows so much about Shropshire. He may possibly have seen in the Farmers Weekly, a couple of weeks ago I think it was, an article upon three holdings that were arranged for by the Shropshire County Council Agricultural Committee and in respect of which one of them was retained for the management, as it were, by the County Council itself, with a tenant put in, of course. I studied that article with great interest and I noticed that where there were good buildings and improvements, such as you would get with a re-equipped holding by a county council under a small holdings scheme, they assumed in the balance sheet of the small farmer two things, which interested me very much. They assumed that the rent to be charged for the thirty-six acres which he was farming was over £6 per acre. It was a mixed holding, both arable and dairy. Also he was reckoned to be involved in a charge of the equivalent of interest upon tenant's capital of £180 a year.

If this scheme is to be brought in for a general charge against the guaranteed prices—and even in the case of a county council they have to do it upon a financial basis of that kind—then one can fairly foresee that, unless there are some safeguards, there will, with these additions, very likely be increases of the small farmer's rent. I hope that what I have said wil1 be looked at by the Minister. He can look up the example I have given. There was nothing about my case on the matter in the article, but it seemed to be a subject of intense interest to see how those charges worked out in the tenant farmer's interest. Obviously, in the case I have cited the farmer was a fairly hardworking and efficient tenant. He did not employ any labour, apart from casual labour at such times as harvesting and the like; the total charge of that casual labour was £100. But other charges were so high that when he had done all he could, entirely by this own labour, he received a net profit, before taking into account his time of work as a full-time worker, of just over £600 a year. In relation, therefore, to the general size of his business, I would say that that was a wholly inadequate remuneration. If you are going to try to deal with the small farmer in such a way as to improve his position I think that you have to do something better than is done in this Bill.

5.9 pm.

LORD LOVAT

My Lords, I should like to preface my remarks by saying that I hope I am a better farmer than I am a speaker in your Lordships' House. I have listened with great interest to all the speeches that have already been made in this debate, and they have been of a general character. That was necessarily so because they covered a very wide range of topics. I am going to confine myself to the Scottish aspect of Clause 3, which refers to a penalty, or what amounts to a penalty, on those hill farmers who will no longer enjoy the benefit of grant—at least, the marginal agricultural production grant, in the case of men farming 150 acres and over will be reduced by 50 per cent.

I am going to try, very briefly, to prove to your Lordships how necessary it is, in my opinion, for the Government to review this situation. I am glad to think that they have left the door open for this, and I will not use the big stick, because I feel that they have had second thoughts on a matter which is very vital to us in the North. The hills are perhaps the last part of the farming country where there is still room to produce more store cattle and sheep, and, since we are a meat-eating nation, I feel that noble Lords on both sides of the House are entirely agreed that the more store cattle and the more lambs that can be taken off the hill farms the better, though at the same time there is need to increase the productivity of the in-by land of those farms on the edge of moor or deer forests.

Now, my Lords, perhaps I may briefly run through the story of the origin of the marginal production scheme. Originally, the idea was to provide special assistance for production from marginal land at the time of desperate food shortage at the beginning of the war. In order to increase crop production for human consumption, no efforts were spared to encourage work which, during the depressed period prior to the Second World War, had proved quite uneconomic even though costs were then much lower than they are to-day. I think that every hill farmer appreciates that the urgency of securing food production of the kind I have described during war time and during the submarine blockade has now entirely ceased. Hill farmers have readjusted their attitude to the realistic approach, and to-day we consider that the object of grants is to ensure the maintenance of a decent cropping programme on marginal land which, without assistance, it would not pay to cultivate. I want to emphasise that point, because to get their grants the farmers have to carry out the prescribed operations which have to be approved by the vigilant eye of an extremely capable local agricultural executive committee. Quite apart from what they get in the way of grant, the farmers have, in addition, to put in a great deal more out of their own pockets. It is not simply a case of using the grant and nothing else.

I think that your Lordships are all aware of the poor nature of the land on these poorer hill farms, and of how it has probably been won from nardous and ling land, rush land, and peat soil, which is so poor that it will immediately revert unless it is kept in hand. The first thing that these farmers who have 150 acres of that kind of land will do is to put it down to grass; and that will mean simply that those farms will immediately lose their carrying capacity for stocker cows from which to breed wean cows for store markets for the arable land and the more fortunate people who farm in the Garden of Eden. I am talking now for people on the 1,000-feet contour land, and above, which I know intimately in my own crofter county area. I think that your Lordships should know that, since we in Scotland have been given assistance of this kind—and admittedly we have other subsidies—of the population of beef cattle in Scotland, nearly all of which are cattle that lie out all the year round, in a climate which is extremely severe (incidentally, we have not been able to put a plough in the land for the last six weeks) the number of breeding cows has risen from 107,000 in 1945 to close on 250,000 in 1957. That is a very remarkable achievement in a comparatively short period of time. It seems a very ill-conceived move on the part of the Government to drop this land just at a time when Scotland is becoming fully attested, and when the large influx of store cattle from Ireland will cease.

There are many other global problems in connection with mutton and beef. As think your Lordships are aware, as the standard of living goes up throughout the world, we find that in areas which hitherto were considered wholly unsuitable for agriculture new breeds of cattle, both dairy and breeding, are being evolved to supply those nations which previously regarded meat and milk as perquisites granted only to the very rich. We are faced with the position that from countries like the Argentine, which once relied on exporting beef to Britain, we are going to get less and less beef. Exactly the same thing applies to Australia, where there are severe droughts, plus an increase in population. Very much the same thing applies in the United States, where drought in Texas has to a great extent killed off the beef cattle in the last seven years. All these countries, which hitherto had a surplus to export, now need it for themselves: and if the Government are now going to cut out the farmer in the North—who, of all the farmers, has the best facilities for producing these cattle and sheep—I think they will be doing a disservice to the community as a whole. The sum involved is negligible—£1¼ million. That is about one-tenth of the amount of money spent in working out a new pilot model of some large aeroplane which probably will never fly.

I would like now to quote one passage from the Report of the Natural Resources (Technical) Committee under the chairmanship of Sir Solly Zuckerman. That Report, published in 1957, was a realistic survey of the wealth and potentialities of our country. The Committee considered these economic and social aspects of farming on marginal land and stated: … we need to remind ourselves that a nation as dependent as is the United Kingdom on imports can ill afford to neglect the possible savings that might be obtained by the exploitation of the whole of its land resources. … On the general grounds of the problem of the balance of payments we … conclude that it would be imprudent to allow the wastage of our marginal land and the decline in its fertility to continue unchecked, as though it was a necessary and inevitable process … It is essential that investment in farming on marginal land should be considered in relation to the overall role which these areas play or should play in our national life. My Lords, I ask the Minister of State, Lord Forbes, to give very careful consideration to this penalty imposed on farms of 150 acres on marginal land by the fact that they are being debarred from a grant which they deserve, probably, more than anybody else in the United Kingdom.

I have often spoken in this House of the cost of travelling from the Highlands of Scotland down to London and back. I should like you to know that we have to pay very much more for everything we buy from the South, and that because we sell at glut periods in the autumn, with the ever-present menace of winter coming up behind, we get less for what we have to sell. You would hardly believe some of the rigours of the climate in the crofter counties in the late spring, when hay has to be brought up from the South at a cost of up to £25 a ton. I saw that price paid for hay in the late spring in 1952. I have seen snow twelve inches deep on the lawn on the 1st of May and the ground too hard to bury an old cow on the last week of April, the frost was so deep into the ground.

Any hill farmer will tell you that he might have very good years, but that one year in five is considered a dead loss. The sheep stock May well be wiped out; or the ewes may have no lambs in a disastrous storm, and there may be only enough in the wool clip to pay the shepherds' wages. I would ask the noble Lord the Minister of State for Scotland if he will again reconsider this retrograde step, affecting a struggling farming community who have put their all into a programme which is of itself a long-term programme. You cannot turn off the tap in the farming business by changing your mind at the end of a three, four or five year plan. In any case, we were given no warning at all, and I think that that was an extremely unfair move. There was not sufficient time to allow the ordinary man with common sense to reorganise himself and adjust his programme to make the reorganisation effective and economic. I hope that the Government will reconsider Clause 3 of this Bill.

5.22 p.m.

LORD STRATHEDEN AND CAMPBELL

My Lords, I rise to support this Bill, which undoubtedly will be of considerable advantage to small farmers, especially as I understood my noble friend Lord Waldegrave to say that opportunity will be taken to work out any anomalies which are found to arise under the rather complicated and completely new method of assessing the merits, and otherwise., of a farm when application is made for the grant. I do not want to go further into that side of the Bill, because I want to concentrate on how the Bill affects Scotland.

It does not appear to me that my right honourable friend the Secretary of State for Scotland fully appreciates the great importance of marginal farming in Scotland. My noble friend Lord Loyal stressed the advantages of the marginal grant and I do not want to repeat them, but they are certainly as important as he said. I would not go so far as he did in considering the marginal grants as untouchable. Warning was given that they might be reduced, though I do not think that anybody, however carefully he read those warnings, had any thought that they might be removed entirely, which is what may be done. However, I am extremely grateful to my right honourable friend for the reprieve of three years, in the case of farms under 150 acres, and of one year in the case of 150 acres and more.

There are varying types of marginal farm. There are the big units in which some land may be classed as marginal. Here perhaps I ought to declare an interest, as part of the land which I myself farm is at present, and I say deliberately "at present", classed as marginal. There are these large farms, Where it is possible that the marginal area may be complementary to the rest of the farm and can be used with advantage to supplement the better farming land which is included. There are other areas which are high—not quite the same as those mentioned by my noble friend Lord Lovat just now—which might with advantage, become genuine hill-grazing farms.

Then there is the third kind, which was mentioned by my noble friend in the special context of the contour of 1,000 feet or above, where land, if it is not ploughed in rotation, reverts to useless pasture. I want to make the point strongly to my noble friend the Minister of State that that type of farm exists in other parts of Scotland and at an elevation a great deal higher than 1,000 feet. It accounts for a very considerable area of farming land in Scotland, and cannot be treated with almost the contempt, I was going to say, which appears to be intended.

Also, these farms cannot be assessed purely on an acreage basis. One cannot say that because a farm is 150 acres or more it is no longer marginal. There are farms—and I definitely know them—which are of more than 150 acres but which are wholly marginal. I admit that they are receiving grants which are not received by the rest of the agricultural community, but their expenses are very much greater. The land is more difficult and the equipment required may well be more expensive. So I hope that my noble friend will see whether he cannot persuade his right honourable friend to go carefully into this question during the reprieve of one year which has been granted.

There is one other aspect of this problem which I should like to go into, and that is the financial aspect. It is stated in the White Paper that the Small Farmers Scheme and the Supplementary Scheme will cost £9 million, to which is to be added £3 to £4 million for additional production grants which probably will be incurred owing to improved husbandry on the small farms, as is perfectly right. From this will be deducted the £3 million on the additional production grants, which are to cease—that is, if the provisions are not changed, as I hope they will be—leaving the rest of the £9 million.

The White Paper also states that this amount will be taken into account in the Annual Price Review. I am not quite certain how this is to be regarded. It may be that the marginal farmer, in addition to losing his marginal grant (and this especially affects Scotland), will receive a smaller production grant to cover this deficit. At the best, it seems to me that, having lost the satisfactory and selective marginal grant, which was given only on work done, the smaller farmer will then have to share with his more fortunate brethren, who have lost nothing, a part of what has been removed from him. I hope that I have made myself clear to my noble friend. I would therefore ask him to look carefully at these two points: the truly marginal farm, even though it is in excess of 150 acres, and the advantages of the selective and the variable M.A.P. grants.

5.30 p.m.

VISCOUNT MASSEREENE AND FERRARD

My Lords, on the whole I welcome this Bill, but more particularly from the human and social angle, since the small farmer represents some of the finest and sturdiest stock in the British Isles. In an age when individuality is fast becoming a thing of the past, it is a pleasant surprise to find a Bill, such as this, whose purpose is to keep the small man in farming solvent and master of his own destiny. Small farms cannot, of course, be so economically and efficiently run as large farms, but we should not judge everything on material grounds. In human values I think the small farmer contributes a great deal to the social and inward strength of the nation.

I have been a little surprised by the criticism, some of it from noble Lords opposite, as to how the Government are financing this Small Farmers' Scheme and the supplementary scheme. We have heard that the money required for the Small Farmers' Scheme is to come out of the global guarantees. Some noble Lords opposite seem to think that that is a terrible thing; but when we consider that the global guarantees are £1,270 million and the subsidies are about £300 million, it really has little bearing either way. I should have thought that it would be most agreeable to noble Lords opposite that indirectly—I quite agree that the taxpayer provides the money in the first place—the more prosperous farmers are to a certain extent subsidising the small farmers.

The White Paper tells us that to be eligible for this scheme a farm must have not less than twenty acres of crops and grass and 250 standard man-days, and not more than 100 acres and 450 standard man-days. We also have the field husbandry grant, apart from the farm business grant. Is it not possible for these two grants to be made into one grant? Is it not rather splitting hairs to have two grants? The Bill appears to me to be quite complicated enough for the average small farmer and I should have thought that he may well get muddled up if he has to apply for two grants. If we now take the farm business grant of £6 an acre for crops and grass excluding rough grazing, and subject to a maximum of £360 a year paid in four equal instalments over three years, we see that the maximum farm of 100 acres eligible for this grant gets in these instalments £90 a time. What can you buy for £90?

For instance, the farmer with 100 acres of crops and grass would probably like a pick-up baler, which, as your Lordships know, is a wonderful labour-saving machine. But a pick-up baler costs about £600. He can buy a dairy cow; he can buy a good cow every year with this £90. If we take the farmer with twenty acres, he will get only £30 in instalments. What can he buy for £30? He can perhaps buy a few hens. What I am rather frightened of is that the grant is not really large enough. When you get a small amount of money it is extremely easy to fritter it away. Could not the Government devise some scheme to help the small farmer by services rather than with cash? I appreciate that we have the excellent advisory services, but if we could provide the small farmer with up-to-date equipment and the operators to work it I think that that would be of great help to him.

The bugbear of the small farmer, and in fact of all farmers, to-day is the cost of machinery repairs. The smaller you are the more likely you are to have to rely on the local garage and repair shop, whose charges are exorbitant. On the other hand, if the Government, perhaps through their advisory officers, could encourage the small farmers to form clubs or cooperative societies (I prefer the word "club") to band together and buy farm equipment and share it out among themselves, that would be of great assistance.

When we come to the £9 an acre grant for ploughing up crops and re-seeding grass under the field husbandry scheme, I hope it will be used only on land that will really benefit, because I have seen, as I am sure many noble Lords have, that a great amount of land has been ploughed up in the past, during the war years and after, that really should not have been ploughed up at all; it was quite uneconomic to do so. You can grow perhaps only two extremely poor crops, and when you put it down to grass again it is even poorer grass than you ploughed up. We appear to have to-day far more cases of pine in stock than we used to have before the war, and I am sure that it is owing to the fact that during and after the war all this grass was ploughed up and we have not been able to get many of the natural herbs back into the pastures.

There is, I know, one part of the United Kingdom which will welcome this Bill wholeheartedly, and that is a part with which I am somewhat connected. I refer to the North of Ireland, which is a country of small farmers. In fact, the whole countryside is like a patchwork quilt, and you can hardly swing a cat in most of the fields. We have 80,000 agricultural holdings in the North of Ireland, and all of them are owner-occupied. There is not a single tenanted farm in the whole of the North of Ireland. Accordingly, the farmers have no philanthropic land owners to pour money into their lands and buildings. Any help the Government can give to buy stock and equipment is, therefore, doubly welcome. Unfortunately, many of the holdings are under twenty acres—I think well over half. Therefore, for the sake of Northern Ireland particularly, I hope that as soon as possible Her Majesty's Government will consider reducing this limit of twenty acres. I should also like to see that where farms of under twenty acres of crops and grass have rough grazing they should come into this scheme if, counting their stock on rough grazing, they can show 250 man-days.

One thing of which I am quite sure is that the small farmer must be supported at all costs, even if it is not economic to do so. The Minister said that we were to help farm businesses only if they had a chance of being economic. I appreciate the sound economic sense of that idea, but, on the other hand, I do not think we can afford to look at our small farms entirely as an economic asset. For instance, do the Government and the nation look at the workers in the coal mines and the rail-ways wholly from the economic angle? When we think of the hundreds of millions of pounds poured into the nationalised industries from the taxpayers' pockets, irrespective of whether those industries show a profit or a loss, why should the small farmer be told: "You cannot be helped unless you are an economic proposition"? How, for instance, would the railway worker like to be told: "You cannot have your full wages unless you are an economic proposition"? Your Lordships know full well how the railway worker would react through his union—he would hold the nation to ransom. But the small farmers are too intrinsically decent, no matter how sorry their lot, ever to hold the nation to ransom. Therefore I earnestly ask Her Majesty's Government, in dealing with the small farmers, not to help only the most economic farm businesses, but to help all the small farmers within the prescribed limits as laid down in the Bill. I hope that all farms under twenty acres will eventually be allowed into this scheme.

Before I sit down I should like to ask—because I have not seen it explained anywhere—where a small farm ceases and a smallholding starts. I do not know whether the Minister has any ideas on that, but it is a question which has always confused me. I beg to support the Bill.

5.49 p.m.

THE DUKE OF ATHOLL

My Lords, I have listened with great interest, particularly to the three previous speakers, and, like the noble Lord, Lord Lovat, and the noble Lord, Lord Stratheden and Campbell, I am not entirely happy about the Bill in so far as it affects Scotland. I am sure that we are all most sympathetic towards the small farmer Who, through no fault of his own, can scarcely make a living out of his holding, but I feel that this sympathy ought not to blind us to the economic facts of (he twentieth century. Farming is becoming more and more a specialised industry, and as such requires frequently costly equipment. For a farm to be able to carry this equipment, it must, I feel, be fairly large. In fact, I believe that an agricultural economist once worked out that the ideal size for a farm on good corn-growing land in England was 960 acres. Although I am not suggesting that it would be ideal in any way for all farms to be as big as that, I do feel that the Government have pitched their lower limit—and here I must draw swords with the noble Viscount, Lord Massereene and Ferrard—rather too low, when they take 20 acres as the low mark for their assistance. I personally feel it would have been better if they had taken 60 or 80 acres.

I am sure many people will argue that the small farmer can make use of contractors, but I do not think that this is a satisfactory system. The contractor with a combine has to go round the various farms in turn, and his considerations will not be the readiness of the crop for harvesting but the propinquity of the farms, the order in which they contacted him and, even more, which is likely to produce the most work for him in the future. At our farm this autumn we got a combine by a contractor, and owing to the weather, through no fault of the contractor, he was not able to get on to the farm until the end of October, by which time, of course, 50 per cent. of the crop had been completely lost. I therefore think that if farms can afford to have all the modern equipment for themselves it is a much better thing. It seems to me that, with a few exceptions where amalgamation would be impossible or where a specialised crop such as raspberries or asparagus is grown, it would be better if the smaller of these farms were encouraged to join one with another, and that by giving them these proposed grants the Government is merely postponing the problem for another twenty years or so. After all, the problem now is not, as it was in the war, to produce as much food as possible, but to produce as much food as possible economically.

Secondly, the reduction and eventual removal of the marginal land assistance grants at the moment is, I feel, badly timed. I fully realise that the Government have to pay for their small farmers' scheme if possible without increasing their present agricultural subsidy, and I would agree with them that probably most of the really large farms at present classed as marginal can well afford to lose those grants. I do feel, though, that they may not have studied the practical effects of removing them. When the scheme was first announced we got in touch with five of our farmers who lived close to us; they are all fairly large farms and all get greater or lesser assistance from the M.A.P. grants. I think they get a total of round about £3,000. We asked them what their reaction would be if the Bill went through unamended—this was before the Government agreed to extend it for a year—and what they were going to do about it, and they all said that their reaction ought to be (they did not necessarily say they would do this) to get rid of one or more men, put a lot of land they had been ploughing up over to grass and improve their sheep stock at the expense of cattle and corn.

I feel that not only is this a bad thing from the agricultural point of view but it also raises certain social problems in the smaller Scottish villages, where four or five men finding themselves suddenly out of a job is quite a serious problem. So I feel that while one can probably justify the decision of Her Majesty's Government to reduce the M.A.P. grants straight away or, as they are now doing, by 50 per cent. this year and then presumably remove them completely next year, it definitely has complications, socially and physically, for the people concerned. I personally think it would be better if the Government could see their way to reducing them much more gradually over a period of say five or seven years.

I would ask my noble friend Lord Forbes whether he can give us some indication of the long-term outlook for marginal land arid also can tell us how much the M.A.P. grants cost last year, how much the new small farmers' scheme will cost when it gets going in, say, 1961, and whether he could break those figures down into respectively those for Scotland, those for England and Wales and those for Northern Ireland. Also, from the financial point of view, I think it ought to be pointed out that whereas the M.A.P. grants are classed as income, and therefore the Government get a very large percentage of it—or perhaps not a very large but at any rate an appreciably large percentage—back through direct taxation, the small farm grant will be capital and therefore they will get absolutely no return through direct taxation. So in fact it would prove to be not only £6 million more expensive but probably another £1½million or so, too.

To sum up, therefore, I should be happier if both the minimum and the maximum sizes to qualify for grant under the small farmers' scheme were raised, if the marginal land grants were gradually whittled down over a period of years, and if we were told now in what way this whittling-down process was going to take place and over how many years, so that we could plan for the future.

LORD STRATHEDEN AND CAMPBELL

My Lords, before the noble Duke sits down, would he make it clear that when he was talking about large farms on which some owners or occupiers were prepared to forgo their grant, those farms were part marginal and part hill? They were not all marginal.

THE DUKE OF ATHOLL

They were all part marginal and part hill, and in nearly all cases very large hills.

THE DUKE OF BUCCLEUCH AND QUEENSBERRY

My Lords, I welcome the constructive new proposals for small farms and they have been well received throughout the country. I Should like to add a very few words in support of my noble friends from Scotland and the representations of the farmers concerning those parts of the Bill especially affecting Scotland. I should also declare an interest. This Bill concerns the whole of Scotland, the land of Scotland and the people of Scotland.

Since the proposals were first made public they have been subject to careful examination. We are indebted to the Secretary of State for the concession which he has made, and must hope that during the coming twelve months he will be convinced, and will be able to convince his colleagues, that it is desirable to continue the assistance which was taking place. There are doubtless good arguments for a reduction in the payment of subsidies if this could be done without any harm, and also presumably there were other arguments for his original proposals, but there is now a general conviction that the marginal assistance was most beneficial and it would be a real misfortune to withdraw it, that the actual effect would be very harmful, and, in addition there would be damage in the way of loss of confidence.

I hope the noble Earl who represents agriculture in this House and the Minister of Agriculture and his colleagues in England recognise the very large extent to which Scotland is concerned in comparison with England, and the high percentage and big acreage of land which can be made economically productive by continuation of the M.A.P. grants, and, conversely, how it would be affected if they stopped now. With the emphasis on economic production I think this ought to be borne most carefully in mind.

I feel that the case has been strongly put. I was glad to hear the noble Duke refer just now to another aspect of it. I am sure it is realised that all those who are concerned about the depopulation of the uplands of Scotland are extremely worried by any measures which would increase this trend. Efforts are being made, both in agriculture and in forestry, to try to keep people in the valleys and the uplands in Scotland, with some success, I believe. But these proposals, if carried out as originally intended, would be most harmful.

Since the decision was taken last summer the financial recovery has continued, and there are various other things which may also affect decisions now. We have heard that we are to have less beef from the Argentine, and we realise that we may have to anticipate more lamb and mutton from New Zealand. We should not wish at this time to see a reduction in cattle breeding and production in Scotland and a return to sheep and mutton. If there has been any looseness in the working of the marginal assistance, that could well be tightened up, and I hope that the confidence of the farmers that they will be able to earn the continuation of those grants will be restored.

6.2 p.m.

VISCOUNT STONEHAVEN

My Lords, I must first declare an interest, as being a landowner and a small farmer, and also because at the moment I enjoy a marginal grant on one and a half farms. I want to divide what I am going to say, which will be quite brief, into two parts and to get the pleasant part over first. I want to support the Bill and to commend the Government for their enterprise in taking up this very difficult problem. Some time ago I made a speech—at the wrong time, as usual, and in considerable detail—criticising certain details of the scheme. Of course a line has to be drawn somewhere, and wherever it is drawn somebody who is the wrong side of the line grumbles. I think one may say that the Government are entitled to draw the line where they think fit. There are bound to be grumbles, but, provided that the Government's outlook is flexible, as I am sure it will be, and that they watch how the scheme operates, I do not think that we have much to grumble about on that score.

Then, as I understand this Bill, it gives something in the nature of a capital grant, although it is spread over three years. That is quite helpful, but I think one must keep that in mind when, later on, we talk about marginal production grants, which are essentially income grants, or something of that nature. Then the complications of the scheme have been criticised, and the decimal system has come in for a little criticism. But for years and years we have been paying out millions of pounds to educate children. If the farmer cannot do his own sums, then nine times out of ten his son can, if he is at school today. If not, then it is just a little too bad. The matter is not all that complicated, and if the son cannot do these sums it means we have wasted far more money on education than ever we have on agriculture.

I think it is a move in the right direction to regard agriculture as a business. We in Aberdeen are up with the times. We have appointed an economist to the Chair of Agriculture at the University. We are the first people to do so, regarding agriculture, as we do, as having some connection with the general economy of the country and as a business. That is a step in the right direction, and I am proud of the fact that we have been the first to take it.

Then we come to the key question: do Her Majesty's Government still want as much food as possible produced at home, having regard to the balance of payments question, and also to repercussions from possible unemployment and the employment of people in difficult areas? In that connection, I should like to say that to talk in terms of percentages of unemployment is rather misleading. If you have thirty men, ten of whom are unemployed, that is a very high proportion indeed—it is one-third. If, on the other hand, there are 300 men and only ten are unemployed, that is a low percentage. One must consider employment in relation to the total number of people in a district and the availability of work. Sometimes we are inclined to think that it does not matter. That is rather unfortunate. I feel rather strongly on that aspect. I am not going to say any more on that.

Now I come on to the proposal to remove the M.A.P. grants. So far as I understand the position, farms of 100 acres and under which are getting the M.A.P. grant at the moment will do so for another three years, including this coming season. At the end of that time they will get nothing. The farms of 150 acres and over will get for one more season 50 per cent. of the grant they have been getting. I think that is the position. I must point out that it is a long time since eight Scotsmen took part in an agricultural debate in your Lordships' House. I think that fact is not insignificant. This time we are against the removal of these grants, and we have the support of the Scottish Farmers' Union and the Scottish Landowners' Federation—two bodies, the lairds and the tenants, hand in hand. That, too, I think is significant.

The other fact that I should like to point out is that I do not regard this grant as at all untouchable. There are cases where it could be tightened up and so on, but in my opinion the repercussions and effects of removing the grant were not fully realised, or even fully gone into, when the scheme was proposed. I hope that if these grants are to be removed within the three-year period, the question of what is going to happen to the land, how much of it there is going to be—whether it is as much as we say or whether it is as little as the Government say—will be thoroughly gone into. The Government now have a new toy, I understand, somewhere down near Reading. It is an electronic computer. You can put your problem into that machine and you get an answer straight away.

When it is said that all forms of support are being considered and that they are impracticable because it is not possible to do the accounting, I would point out that Mr. Fraser, who is not unknown in Scotland, has a system whereby he takes over a business. He leaves the existing people to run the business, but he takes over the accounting. He has one electronic or modern accounting machine and one girl, and that pair will deal with £1 million of invoices and other things in varying amounts of £1 and 17s. 6d. When the Government say that these things are quite impossible, my reply is that it is time they brightened up their Ministries in regard to some of their accounting ideas, so as really to make sure that some things that are thrust aside as being too difficult can be brought into operation in the more modern conditions which exist at the present time. We are always being told to bring ourselves up to date. So I hope I am right if, in return, without giving any offence, I offer some advice to the Ministry.

The problem of this marginal land is that one cannot get it rapidly back to fertile land. It is a long-term policy and, admittedly, a costly one. Nevertheless, if one is to use the decreasing good land for fattening cattle one must have a reservoir of poor land producing those store cattle to fatten on one's good land; otherwise the good land will be used uneconomically by having to breed on that good land cattle which should be bred on the hills. That is a point which should be considered in all its due weight.

Then there is this question of guaranteed price. I should like very much to know what guaranteed price there is for any store animal. So far as I know, there is none; and therefore somebody who is producing store cattle is at a disadvantage, from that point of view, compared to somebody who is dairying, or producing fat cattle or grain, who has a guaranteed price. All this underlines the necessity as we regard it of putting something in place of marginal production aid if that aid is not to be continued. Having thoroughly overhauled the whole system, and possibly the whole system of grants—and it may be that there is an easier way of doing the whole lot, for they have grown up piecemeal, which may be a disadvantage—and it may be improved by generally considering the whole matter under one heading of the profitability or unprofitability of these small farms.

I would ask your Lordships' pardon for leaving, if I have to do so, before the debate is over, but I must catch my train. I should like to finish by asking my noble friend the Minister of State whether he will give very careful consideration to possible substitution schemes When these marginal production grants have been removed. I feel that that is all one can ask.

6.13 p.m

VISCOUNT COLVILLE OF CULROSS

My Lords, I only want to add a postscript to the marginal aid payments scheme and the problems which have arisen in Scotland out of this Bill in connection with marginal aid. Your Lordships will have heard that considerable importance is placed upon the marginal aid payment assistance by those who have marginal farms in Scotland, and I would point out that those farms which receive marginal aid are also in receipt of all the other grants and assistance received by farmers who have more productive land in the rest of the country. I think it is remarkable that, in spite of the receipt of all those grants and aids, they should still set such store by marginal aid payments. It is therefore vital, to my mind, that Her Majesty's Government should not be too rigid in removing that provision altogether and providing no substitute.

I should like to support what my noble friend Lord Stonehaven has just said about the different nature of marginal aid payments assistance and aid which is to be given under this Bill. There are various farms, from the smallest possible acreage up to well over 150 acres, which are at present in receipt of marginal aid assistance. A certain class of farmers, with farms of between twenty and 100 acres, are to receive capital assistance, once and for all, under this Bill, but some of those farms which are themselves within the range of the Bill are still not to get capital aid. Either their schemes are not to be put forward at all, perhaps because that is impossible or because the farmer does not want to do so, or their schemes may be rejected, or they may fail to carry them out and their grants may be revoked. That puts them within the same category as farms below twenty acres and above 150 acres, all of which, at the end of either one or three years, will cease to receive marginal aid.

The thing that strikes me about this problem is the remarkable lack of information produced by Her Majesty's Government as to what is, in fact, the situation—how many farms below twenty acres or above 150 acres, or in between, are to be in receipt of, or have in the past received, marginal aid; and what their estimate is for the future. It is quite clear that certainly within three years, and in the case of farms of over 150 acres within one year, some policy will have to be formulated, and formulated in time to be produced and explained to the farmers and for them to make future arrangements to put such scheme into effect.

At the same time as this is going on, the agricultural executive committees are going to be "snowed under" with the work of sorting and approving schemes under this particular Bill; and this applies all over the country. If Her Majesty's Government have no information now, it does not look to me as though they are going to get a good deal of information during the time that grants are going through. I would suggest to Her Majesty's Government, therefore, and perhaps my noble friend the Minister of State might tell us whether it is a possibility, that from the very beginning various agricultural executive committees might be encouraged to set up parallel lists. They should get a great deal of information about the nature of farms, certainly those within the twenty-acre to 100-acre category, as farmers apply for schemes. They must have lists of those who have received marginal aid in the past and are receiving it at present, and if they were to set about it at the same time as they are considering schemes under this Bill they should be able to produce information as to the incidence of this problem and the amount involved within eighteen months or so, which would enable them to produce, in time, a policy of some kind which would be a substitute to the marginal payments which are now to cease.

In speaking on the Second Reading in another place, the right honourable gentleman the Minister said that there were certain farms which were not capable of yielding an adequate return. I believe he was referring to small farms, particularly, perhaps, to those below twenty acres. Those, he said, represented a social problem to which, frankly, he did not know the answer. I am certain that the answer is not to let either those or bigger farms revert to heath and bracken, and I am equally sure that the answer is not to allow the population to drift away from the rural areas into the towns as the result of that reversion.

I beseech Her Majesty's Government to set their best attention to this and to produce a rapid and flexible plan. Let them take advantage of the mistakes that have occurred in the marginal aid scheme in the past. Let them avoid the money getting, perhaps, into wrong hands; and let them also avoid uncertainty from year to year as to whether or not a farm is to receive marginal aid payments. At the same time I do not suggest that they should in any way copy the system of fixed limits that has been employed in this Bill, because obviously acreage and standard man-day limits are not applicable to a marginal aid problem. And so let them be flexible and let them do something about it quickly.

My Lords, this problem does not really affect the merits of this Bill. It arises out of it, but it does not affect the merits of the Bill as such; and I should not like your Lordships to think that because I have made suggestions about this correlated problem I am criticising the Bill at all. I think it is to deal with a different problem altogether. I think it should be associated with a new M.A.P., but I do not think the fact that the Bill itself does not contain any new M.A.P. makes it a bad Bill. On the contrary, I support it and I commend it to your Lordships.

6.21 p.m.

EARL FERRERS

My Lords, I confess that I feel rather like a fish out of water. Following seven noble Scottish Peers is a quite formidable task. However, I make no apology for endeavouring to direct your Lordships' minds further South. I wish I could feel the enthusiasm about this Bill that has been shown by a number of noble Lords on this side of the House, but I have certain reservations.

To my mind there seem to be two major considerations concerning this Bill. First, is it right and wise from a social and economic point of view to single out a special part of the agricultural community for preferential treatment? And, if it is right to do so, is this the best way of doing it? To deal with the first point first. I would say that on the one hand we have a body of opinion that feels that the small farmer, farming as he does in a competitive world, with a limited acreage and a limited capital, is at a disadvantage. At all the recent Price Reviews the guarantees for pigs, eggs and milk, which are generally accepted as being his normal source of revenue, have all been cut; therefore he is in a position to ask for special treatment. On the other hand, there is a view which considers that it is imprudent to give special assistance to one type of farmer. More narrowly, it is considered that the price of a commodity should be the same, whether it comes from a large or a small farm, and the subsidies which that commodity enjoys should be the same. But, to my mind, far more important is the point of view which says that if a small farm is uneconomic, then it may be inadvisable to give it special financial assistance; and I must confess, my Lords, that my own feelings tend rather to lie with the latter two arguments.

For the last ten or fifteen years trends have been such that the economic minimum size of an agricultural holding has had to increase in order that that holding should remain economic. With the advent of mechanisation and the high cost of labour, farms have had to be larger in order to accept those increased costs; and every indication goes to show that this trend will continue. I think we must face the fact that the economic minimum holding will, in future, grow larger and larger. Therefore, as I see it, the man with thirty, forty or fifty acres is going to have an increasingly difficult time to make his farm pay. The only way in which he can do it is to farm his farm as intensively as possible, and by doing that he must produce eggs, poultry, pigs or milk. Those commodities of all agricultural commodities are the ones which are most easily over-produced. They are the ones which always suffer, or are apt to suffer, from price reductions, due to the fact that their production can be relatively quickly increased and they are relatively quickly over-produced. Therefore, even if the small farmer does farm his farm intensively, he is in a relatively unstable position.

It is perfectly true that there are many small farmers who farm and make a very good living out of it. A number of them, I am told, even pay surtax, and that is a very satisfactory state of affairs. But, of course, those farmers are clearly in a healthy position and need no financial assistance, and will receive no financial assistance. What we are concerned with is the small farmer whose output is so low that he receives the bare minimum—he receives about the agricultural wage or a little more—though his responsibilities and the hours of work which he puts in are deserving of a much greater reward. Is it right that that type of farmer should receive special assistance? I must admit that from my own point of view, looking at the matter solely from the point of view of economics, I find it hard to think that it is. If a small farm is under reasonably good management and is giving the occupier but the bare agricultural wage, it would appear to me to require a considerable injection of capital to make that small farm economically healthy.

That brings me to the second consideration which I mentioned at the beginning: that is, if it is considered right to help a particular section of the farming community, is this the right way to do it? One of the objections levelled against this Bill is that the number of farms which it deals with is very limited. Some people say that the minimum of twenty acres should be lower; some say that the maximum of 100 acres should be higher, and one gets variations of these disagreements. I am not concerned with entering into that argument, because I believe the Minister himself has said that the line has to be drawn somewhere, and somebody is going to fall on the wrong side of the line. But what I am concerned with is the type of farm to which these limits apply.

Speaking generally (and clearly one can only speak generally), I would say that the farmers who, through initiative and enterprise and even good luck, have made a success of their farms are automatically excluded from the Bill, and one is left with the farmers who possibly are less progressive, who have a limited capital and who are thus less creditworthy. How is this type of farmer going to be helped? He is going to be given a maximum of £1,000 and an estimated average of £700 spread over about three years. That means that he will receive between £100 and £200 a year on this improvement grant. Whilst I would not deny in any way that an extra £100 or £200 would be of great assistance, I cannot appreciate that a holding previously of doubtful economic value will, by being injected with this amount of capital, become an economic holding. To carry that matter a little further, I would give your Lordships the example of a person who is entitled to claim the whole of a farm business grant, which means he will be able to claim £360 spread over three years. With that, he would be able to buy one reasonable—not very good, but reasonable—in-calf heifer per year for three years. I cannot believe that that will make his farm into an economic holding at the end of those three years.

Now, there is one point to which I should like to draw attention in regard to the field husbandry grant. A man can apply for a field husbandry ploughing grant if his grass has been down for three years or more, and, if he does, then he is entitled to claim £9 a year for each year in which he ploughs that land, up to a maximum of three years. Now if his field is a four-year lay, or older, he is entitled to claim the ordinary £7 an acre ploughing-up grant, which means that he can claim £34 per acre for ploughing up a four-year lay, or more. That is made up by the £7 an acre ploughing-up grant plus three years at £9 an acre. If he has a ten-acre field, he can claim £340 for ploughing that grass up. That, to my mind, is an utterly extravagant grant in view of the permanent good that will be done. It is good practice from both a farming and a financial point of view to plough up grass and to plough up lays, and many people would adopt that practice even if it were not for the attraction of the £7 an acre ploughing-up grant: and I can well understand the aggravation which may be felt by some larger farmers who feel that it is possibly a little extravagant to give them a further temptation of £27 an acre. But if it will help the small farmers, I should like to see it done in a more lasting way—namely, by a low-interest capital grant, whereby the farmer can have the use of the capital at a low interest. I believe that, if that were done, the benefit would be far more lasting and that it would be a far more acceptable system to the agricultural community as a whole.

Rather lengthily, I regret, my Lords, I have given my views on the drawbacks of the Bill, but I should like to mention, in justice to the Bill, two advantages. The arguments that I have put forward are entirely on the basis of the economics of the business—namely, is it right to spend the money, and is it right to spend it in that way'? I have deliberately ignored the personal, or the social, side of it—namely, is there a section of the agricultural community which, due to world trends, is working with unfair handicaps and therefore requires special attention? If that is so—and I do not propose to enter into that argument—then there may well be a sound argument for the Bill, but it then becomes much more a social problem than an agricultural problem. Then there is the advantage that is going to be gained from the help given by the Agricultural Advisory Service—and this, I believe, will be by far the best effect which the Bill will have. Any farmer who applies for this grant automatically invokes the help of the Agricultural Advisory Service and the agricultural executive committees, and they will be able to give their advice and help to farms which previously, for one reason or another, had not asked for their help. I believe that that will be the greatest advantage which this Bill will have.

Finally, I should like to ask the noble Earl who is going to reply if he can give two assurances. First, I have heard rumours that large numbers of N.A.A.S. officers have been taken out of their counties and drafted down to the part of the world from which the noble Earl hails—down to the West Country—to deal with the expected flood of applications from the small farmers in that part of;lie world. I hope that the noble Earl will be able to assure me that that is a myth, because it takes a long while for an advisory officer to engender confidence among his farmers, and if he is going to be plucked out and put in some other place, and if the farmers to whom he normally goes have then to make the acquaintance of a fresh person just because of this Bill, I think it would be a great pity.

Secondly, can the noble Earl assure us that the business to which these advisory officers will be put will be entirely advisory; and that they will not be embroiled in a large amount of form filling? I am told that the amount of form filling and work that has to be done in the offices in connection with this Bill is quite considerable, and I feel that it is very important to remember that the agricultural advisory officers are primarily and fundamentally advisory, and that in no way should they become pen-pushers.

6.36 p.m.

THE MINISTER OF STATE, SCOTTISH OFFICE (LORD FORBES)

My Lords, as many noble Lords from Scotland have spoken, I think it is only right that I should at this juncture say something about Clause 3, which affects Scotland. I cannot help remarking that there are a number of noble Scotsmen who have fired at me and who have now quickly taken the train home.

The purpose of Clause 3 of the Bill is to provide authority for the continuation of assistance for marginal agricultural production to a more limited class of holding than before. This arises from a review of the scope and the purposes of marignal land assistance. Representations have been made by the National Farmers' Union, by the Scottish Landowners' Federation, and by many Members of Parliament—and now also by many of your Lordships—that, so far as Scotland is concerned, it is wrong to withdraw M.A.P. assistance completely, in that such a withdrawal will seriously reduce production, particularly beef production, and will cause some unemployment in upland areas. In addition, it is said that, even if some modification of the M.A.P. scheme as it has operated in the past is now justified, changes should be introduced less abruptly.

On the first point, I should like to remind your Lordships that upland farmers benefit, directly and indirectly, from a variety of other grants and subsidies which did not exist when M.A.P. was started. First of all, there are the improvement schemes under the Hill Farming and Livestock Rearing Acts, designed to put land and fixed equipment into good shape. Under the same Acts, there is the hill cattle subsidy; and in any year where it is considered necessary there is a hill sheep subsidy. There is also the special provision in the calf subsidy scheme to enable farmers in the hill and upland areas who have to sell their calves before the winter to obtain the benefit of the subsidy. It is, of course, the Government's duty to keep the closest watch on the situation as it develops. Therefore, while assistance may of course be required from time to time, it is not reasonable to maintain that, within the framework of the Government's general agricultural policy of support for home agriculture, and in improving the comparative position of our agriculture, the M.A.P. scheme is of necessity untouchable.

The Government agree that there is substance in the second charge—that is, that M.A.P. is being withdrawn rather abruptly—and to ease the situation my right honourable friend the Secretary of State announced at the Report stage in another place that the M.A.P. scheme would be continued for a further year under existing powers, with the proviso that the assistance given to the larger farms—that is, those of 150 acres, crops and grass—would be on a reduced scale. The most important aspect of this course of action is that it gives further opportunity to the Government to assess the position.

Now, my Lords, the money allocated in 1958 for marginal agricultural production in Scotland was £1,210,000. The estimated expenditure in 1959, following on the decision to continue the M.A.P. scheme for a further year, is £900,000. All farmers who were previously on the agricultural executive committees' marginal lists will be eligible for assistance under the scheme, and the reduction in the expenditure in 1959 will be found by reducing by about 50 per cent. the assistance given to those farmers with over 150 acres, crops and grass. No farmers for the 1959 cropping season will be removed from the marginal lists solely on account of acreage. The committees will be free to review the lists in accordance with the standard which they have applied in the past. Those marginal farms, with under 150 acres, crops and grass, if they fulfil the criteria set out in the White Paper, will receive assistance for the further three cropping seasons—1960, 1961 and 1962, under the scheme to be made in terms of Clause 3 of this Bill.

The noble Lord, Lord Lovat, seems to have some misgiving about marginal land going back to grass. I cannot hold that view. Some of this land may go back to grass, but I do not believe that much of it will, because it is in the farmer's interest to keep that land in production. He is getting the hill cattle subsidy and the calf subsidy, and he will want to keep as many head of cattle on his land as he can to get full benefit from these generous subsidies. I would point out that M.A.P. represents only about one-seventh of the total subsidies that are given to the farmer by the Government. Next week I am going to the Inverness and Beauly area. Without doubt I shall see the noble Lord's cattle, and I am quite certain that I shall find that a large proportion of his cattle are drawing the hill cattle subsidy. The noble Lord made out that his ground is nearly always covered with snow, and that things are very difficult in his part of the world, so I shall make certain that when I go I have my skis with me.

The noble Lord, Lord Stratheden and Campbell, brought up the point that it was impossible to use the acreage basis to decide what is marginal land. That is not what we are trying to do. What we are doing is to distinguish within the marginal groups the bigger farms, those which through extensive operation are in a relatively sound position, from the smaller farms that are in need of further help. We believe that farms of over 150 acres which have had a shot in the arm should now be able to stand on their own feet.

LORD STRATHEDEN AND CAMPBELL

My Lords, may I interrupt the noble Lord for one moment? I entirely agree with what he said about marginal hill farms which get hill subsidies. They are all right. But for the truly marginal low-ground farm a shot in the arm must be repeated continually. It does not do any permanent benefit to the soil which is of sufficiently low quality to need continual shots to meet the added expenditure about which I was talking. That expenditure is incurred over and above that required on the ordinary farms, which can do with the ordinary grants.

LORD FORBES

My Lords, I agree with some of the substance of the noble Lord's argument, but surely if he is referring to the low-ground farm, it has better soil than a corresponding farm which is nearer the hill, and that fact must be taken into account.

The noble Viscount, Lord Massereene and Ferrard, seemed to think that the Government were going to buy a pick-up baler for him. I would point out that although the small farmers' scheme may not be very generous, it is possible to get up to £1,000 under it. I think that we should look at the matter in this way: that although the amounts may seem relatively small, what they are intended to do is to prime the pump, so that the process of development may be started.

The noble Duke, the Duke of Atholl, asked me what was the outlook for marginal land. I would say that it is not the Government's policy to let any land go out of production which can economically produce what the nation needs. At the moment, the emphasis is on "economically." The noble Duke also asked me if I would explain how the money has been, and is going to be, spent in Scotland on these various schemes. In 1958, M.A.P. cost £1,200,000. In 1959, we estimate that M.A.P. will cost £900,000—that is, after the farms of over 150 acres have had their 50 per cent. reduction. In 1959, also, the small farmers' scheme will come in, and we estimate that that is going to cost another £300,000. From 1960 to 1962, the supplementary marginal scheme is estimated to cost £600,000 and the small farmers' scheme, depending, of course, on the response we get to it, a further £600,000.

I should like to correct one statement made by the noble Viscount, Lord Stonehaven, who unfortunately has left his place. I think that he was under the misapprehension that M.A.P. would go on only for three years for farms of under 150 acres. It will go on for the under-150-acre farm for four more cropping seasons. The noble Viscount, Lord Colville of Culross, raised many points about the lists of farmers for the Government. The Government have already undertaken to assess the whole position. The Price Review is the annual procedure for viewing the position and correcting any wrong tendencies. Individual assessment of all farms on the marginal list would be possible, but the Government's general line is to avoid selective subsidies and to aim at economic soundness by setting the right general levels of prices and assistance only.

A great many points have been put to me, and I shall bring all these to the notice of my right honourable friend the Secretary of State for Scotland. In conclusion, I would say that I am confident that the Scottish upland farmers, given the extension of time that my right honourable friend has announced, will assess the position calmly and, at the same time, will continue to make a valuable contribution to the nation's agricultural output.

THE DUKE OF ATHOLL

My Lords, may I put a question to the noble Lord before he sits down? From the figures he has just given, it seems to me that in Scotland the difference between total expenditures for 1958 and for 1961 will be virtually nothing, whereas over the whole country, if I have read the White Paper correctly, the difference is going to be in the region of £6 million. Could the noble Lord confirm that that is so?

LORD FORBES

The figures the noble Duke has given are perfectly correct for Scotland.

6.50 p.m.

LORD STONHAM

My Lords, during my fourteen years at Westminster I have always found it to the benefit and with the full approval of all concerned that on Scottish occasions I should repair me to the Library and endeavour to catch up with accumulated work. It was therefore with a feeling approaching alarm that, when I saw the list of speakers to-day I found myself, as it were, trapped in a position where it fell to my lot to survey the battlefield after a Scottish invasion. Indeed, I am rather glad that I am not in the position of the Government of having to withstand a combined attack from, to mention only a few, the Frasers, the Campbells and the Murrays. It has been an almost continuously critical attack, and particularly in the speech of the noble Lord, Lord Lovat, there was a good deal of alarm which I confess impressed me considerably. At one time I had the honour to represent a West Country constituency which included a considerable part of Exmoor; and while I should not pretend that the problems of upland farmers there are in any way strictly comparable with those of Scottish and Welsh hill farmers, it is an undoubted fact that they must share with Scottish and Welsh hill farmers who have farms exceeding 150 acres the implied disabilities which will come to them under this Bill.

The noble Lord, Lord Forbes, if I understood him aright, in endeavouring to reassure noble Lords opposite with regard to the M.A.P. scheme, said that the expenditure under that scheme in 1958 was £1,210,000; that this year it will be £900,000, and that in 1960 it would depend (in my own phrase) on the good will and good sense of the Minister of Agriculture. That might mean that in 1960 there would be nothing at all under the M.A.P. scheme, compared with over £1 million last year and nearly £1 million this year. In any case, his figures show that this year there is going to be a cut in expenditure under that head of some £310,000. Whichever way one looks at it, that must mean a loss; and it must mean concern to farmers on marginal farms experiencing considerable difficulties.

The noble Lord is right to admit that this decision of the Government is extremely abrupt; and it is small consolation, in my view, that this can be, as it were, guaranteed to continue only for a year, and that there is nothing certain about the future after that.

LORD FORBES

I think I must point out that it is only the farms of over 150 acres that will lose anything; and they will lose only 50 per cent.

LORD STONHAM

I am quite aware that it is only farms of over 150 acres, but in the context of the farms of which we are speaking there are a considerable number of such farms. Since the cuts this year amount to £310,000 it will not support the noble Lord's argument to suggest that those farms are few; because if they are few, then the loss that falls on them as individuals must be considerable. That will end my first venture into Scottish agriculture£and I am glad that I have gone even a little way unscathed.

LORD FORBES

I am afraid that I must point out another thing. It is not a question of there being a large number of farms, but a question of their being big farms. That is why the cut is so large.

LORD STONHAM

I was aware of that, and I must attribute the difficulty not to my reasoning but to my poor understanding of the language. I can remember that the noble Lord and I understood each other much better on a previous happier occasion in Denmark. We must resume this discussion some other time. However, I should not like to leave this point without assuring the Government that we on these Benches are concerned about it, and we hope that they will look again at Clause 3 of the Bill. We take some comfort from the noble Lord's assurance that they are watching this point, and that action will be taken if the fears expressed are realised.

It is an undisputed and unhappy fact that of recent years small farmers have not benefited as much proportionately as their bigger brethren from production grants and subsidies; and their position has been getting relatively worse. This means that about 100,000 small farmers are much worse off than even the reduced figures of total net farm income would have us believe. I am sure, therefore, that we should all have given a warm welcome to any measure properly designed to enable small farmers to earn a fair livelihood. Unfortunately, this is not such a measure. In my view, it is a mean little Bill which in the long run may do agriculture as much harm as good.

In the last Price Review the Government, admitting the need, undertook to make additional provisions designed to give further assistance to small farmers". Those words were part of the bargain with the farmers' unions, and in my view they undoubtedly helped towards the acceptance of the £19 million cuts which were made in the last Price Review. It was thought—at least, I certainly thought it—that "additional provisions" meant additional finance, additional Treasury assistance. But in the scheme (and the noble Earl, Lord Waldegrave, was very coy about this: he made no mention of it in his original speech until my noble Leader brought it out of him by a question) the whole of the £6 million cost of the new grants is to be paid out of the total guarantees. The Government are calling the tune and the farmers are paying the piper.

The noble Earl has objected when it has been said that the farmers are paying. But it is a mere sophistry to deny that. The plain fact of the matter is that, but for this Bill, the farmers would get £6 million more to be divided among them than they will get now. Therefore it is not literally true that the Government are providing that £6 million; and the right honourable gentleman the Minister of Agriculture. That might mean that in saying that he did not intend to expend Government money. Indeed, the only added cost to the Government will be through such increases in grants for ploughing, fertilisers and lime as arise incidentally from the new schemes. This is unquestionably sharp practice, but, in my view, it would not be so bad if the burden fell only on the medium and large farms. But the burden will be relatively greatest on the poorest people: those with less than 20 acres, and those scratching a threadbare existence on semi-barren farms above the acreage limit. It is not a case, therefore, of robbing Peter to pay Paul, but of robbing Tom, Dick and Harry, and they are mostly worse off than Paul. That is why I say that this is a mean Bill.

The Government should have paid for this extra aid in accordance with the implied promise which most of us read into their words. Having said that—and I believe it to be true—I would add that I am sure the Minister of Agriculture and the noble Earl genuinely hope that the Bill will help a large number of small farmers to increase their production and improve their living standards. I hope it will, and I think it may. What I am anxious about is that this improvement for a number of small farmers should not be at the cost of serious harm to other sections of the industry. I hope, therefore, that the noble Earl, when he conies to reply, will be able to give assurances on some of the points which I now want to raise with him.

First, there is the question of principle. It seems to me that the methods proposed in the Bill represent a fundamental change in the agreed principle of the 1947 Act—namely, that general guarantees, plus production grants to encourage specific farming operations, rather than specific farmers, is the basis of support far British agriculture. We have always understood that to be the basis. It was the basis of the 1947 Act, and I say that this Bill, which involves discrimination between farmers, plus inevitable hardship for the excluded, is a departure from that principle. I want to ask the noble Earl whether he can give an assurance that it is an isolated case which, on the point of principle, will not be repeated.

Secondly, I Should like to say a word about the hardship cases. I appreciate that public money, even if it is farmers' money, must not be poured out on farms unless they can be made viable. The arbitrary 20-acre minimum, although it is not written into the Bill, will, as has been said, exclude many thousands of farmers and farms which are, or could be, viable. It is an arbitrary acreage exclusion. For example, I understand that in Cornwall alone there are some 6,800 farms—nearly 50 per cent. of all the farms in the Duchy—which are of less than 20 acres, although many of these are efficient units, as the noble Earl knows, particularly horticultural units, which have already been badly hit by the Government's horticultural policy, or lack of it. Surely some adjustment can be designed to bring them within the benefits of this Bill, if they are viable. There are many thousands of small farmers in other counties, as the noble Earl, Lord Ferrers, mentioned, who are already nearly squeezed out, because price policy has fallen hardest upon milk, eggs, pigs and poultry, which are their principal products.

In Committee in another place, the Minister of Agriculture said that he wanted the scheme to be flexible, and that neither the acreage nor the man-day limits were fixed and immutable. But he pleaded—quite reasonably—for more time to get the scheme going and to see how things worked. When asked how long, he suggested two years. Two years under present conditions would mean that many of the people of whom I am speaking would be driven out of farming. I would ask the Minister if he could give them a more definite hope and, at the same time, ease the sense of injustice suffered at the other end of the scale by 150-acre farmers who are excluded because their efficiency and drive has put their man-days up beyond the limit. Could he, for example, give an undertaking to review the situation in, say, twelve months' time?

I should also hope that lie will be able to say something on the question which I raised with him when I intervened during his speech about the case of the farmer whose scheme, although his farm comes within the provisions of this Bill, may call for more livestock or other changes which will involve new buildings or increases of buildings. Unless his income is in excess of a certain amount, he does not qualify under the farm improvements scheme. If he does not qualify under that scheme, his own scheme cannot be carried out, because he cannot do it without the buildings. It seems to me that there will be many farmers, perhaps thousands, who will come in under the provisions of this Bill but who will be excluded in a practical sense because what is necessary under the farm improvements scheme cannot be done because they cannot get a grant. I would ask the noble Earl whether that point has been fully considered.

Another point which arises in connection with these small men is whether it would be possible for the district officer looking into the scheme, and for the Minister or the divisional officer who has to approve it, to take into consideration earnings from part-time employment on neighbouring farms, or perhaps with the Forestry Commission. Would a suitable scheme be likely to secure approval in a case of, perhaps, two or three men running a farm as a joint venture who work part-time in farming? I am sure that from his experience in Somerset—which is similar to mine—the noble Earl must be aware of small farmers, quite good, efficient people, who would qualify under this scheme, but who at present are engaged in part-time, perhaps seasonal, employment in agriculture. I should hope that they would not for that reason be ruled out for consideration in these schemes.

The third point I wish to raise with the noble Earl has already been touched upon, and that is the position of the National Agricultural Advisory Service. The Minister of Agriculture has admitted the obvious fact that a major objective of this Bill is to attract small farmers, by a financial bait, to accept the service of the Advisory Service. Indeed, the success of the scheme will depend upon the extent to which they accept that service. I hope that from that point of view it is successful, and I agree with the noble Earl that the advice, if taken and acted upon, may be of greater value than the cash—indeed, that has been pointed out: it is not a very large amount of cash for individual farmers.

Much as we favour this idea, we are seriously concerned in case, through inadequate recruitment, the Service should break down and serious damage be inflicted on the great work of the last ten years on our farms in general. Therefore I would ask the noble Earl to consider again these 330 district advisory officers who, it is expected, will have to handle in the first year 15,000 cases—an average of 45 cases each, which is a full-time job. In addition, a great deal of extra work will be thrown upon the divisional executive officers. Until now, as I understand it, each district officer has been looking after an average of some 1,100 holdings, and the Grassland Utilisation Report points out that for this work alone the staff should be increased by 25 per cent. I am not talking about the Farm Improvements Scheme—I am fully aware that that is dealt with by the Agricultural Land Service. What concerns me is that these 330 officers have been taken off the work they were doing—and some of them have been sent to "foreign parts". There is apparently no one to take their places and to attend to the main body of a vital and essential problem. Unless their places are filled, then the medium and large farms, or, indeed, the small farms where they have been helping, are bound to suffer.

I would submit that this is no imaginary bogy. The noble Earl, Lord Ferrers, pointed that out very forcibly when he said how long it took these officers to gain the confidence and respect of the farmers, and then they are yanked up from the work they are doing and sent to different places, where they are not known. Part of their job will be to explain this idea, and to explain and, I hope in many cases, help with the forms, which are complicated for people who are not used to fractions and decimals and to whom it may seem hopeless and not worth bothering with after all. Therefore, this is not an imaginary bogy. I would ask the noble Earl to remember that when the farm improvements scheme was instituted it necessitated the transfer of members of the Agricultural Land Service to areas where delays had arisen through shortage of staff and other bottlenecks. As a consequence, their former areas were necessarily neglected and there were numerous complaints. It will be very wrong to allow this to recur with the National Agricultural Advisory Service. I hope, therefore, that this point will not be brushed aside and that there will be no wishful thinking about it, because very serious wounds could be dealt to the agricultural industry unless the matter were thought out very carefully.

The noble Earl will remember letters published in The Times last November from the General Secretary of the Institution of Professional Civil Servants and from Mr. E. M. Owens, the Chairman of the Development and Education Committee of the National Farmers' Union. Mr. Owen's letter was positively blistering on the subject of the National Agricultural Advisory Service. He said that this: the latest stunt of Government policy, was the final tragedy in a long list. I would ask the noble Earl to tell us what the Government is doing to prove that forecast wrong. Would he say what, if any, has been the increase in numbers of the advisory service in the last three months; and, if recruitment is lacking, will he look at Mr. Owen's suggestion that, as a temporary expedient, district officers should be given such assistance as the work they can attract will justify? I would echo the suggestion made by the noble Earl, Lord Ferrers, that that assistance might include clerical assistance to relieve them of the mass of paper work and allow them to concentrate on the really expert work. Will the noble Earl also say how many district officers have already been seconded to the small farms scheme and, of those, how many have been sent to other districts? Could we also be told who meanwhile is doing their ordinary work?

Small farmers are supposed to initiate their own schemes, but many will be in rudimentary form and there will have to be a lot of prompting on the part of the officers in the working out. I would suggest that these are various ways to avoid clogging the machine. A heavy responsibility rests on the Government in this regard. If that Service suffers serious damage the consequences to the countryside could well be disastrous. I hope we are to be given to-night concrete evidence that through better organisation and, if necessary, better salaries and conditions, recruitment will be so improved that the extra burdens can be carried efficiently.

We on these Benches have always been deeply concerned for small farmers. In fact, I have just recollected that I should have declared an interest some quarter of an hour ago; I have a small farm myself, 70 acres, which is a long way over the man-day maximum, so I have no financial interest in this Bill. We hope it will not be long before we have the opportunity of reinstating the 1947 Act and removing the basic causes of the small farmers' difficulties; and if still necessary after that we shall put into operation a scheme for small farmers which will not harm the general body of agriculture. Meanwhile I hope the noble Earl will be able to show that the Government will avoid doing too much harm before we on these Benches get the chance to put it right.

7.15 p.m.

EARL WALDEGRAVE

My Lords, we have had a very interesting debate and I hope not to have to detain your Lordships too long, but so many points of great interest have arisen that I shall do my best to answer as many as I can remember. Without more ado I will turn to them. The noble Lord, Lord Wise, gave us a very interesting and I thought, on the whole, helpful speech. I thought he made too much play with the difficulty of the application form. I think that the facts disprove his contention that this form is impossibly diffi- cult for the average farmer to understand. He really must not underestimate the intelligence of the farmer.

LORD WISE

My Lords, may I interrupt the noble Earl and give him a mental arithmetic sum? The poultry are all in decimals and the pigs are all in decimals. In the line after those, an addition of 15 per cent. has to be made for essential maintenance and other indirect labour. The mental arithmetic sum I want to give the noble Earl is to tell me what 15 per cent. addition is to .01.

EARL WALDEGRAVE

My Lords, I am not going to give 15 per cent. of .01, because that is not at all the point; really I doubt if this is relevant. In fact you would add 15 per cent. to the total at the end. If you have a child getting towards the 11-plus he would be able to do this sum and help you. The point I want to emphasise is that about 11,000 of these forms have been asked for already, and within a fortnight 3,000 came back from these small farmers, and in a form which would lead us to believe that 90 per cent. will be eligible. I think that on the facts the noble Lord's fears are disproved, and it is a very high tribute to the general educational standard amongst farmers.

Apart from that, and more seriously, the noble Lord asked me whether this kind of scheme was paralleled by the Government in any other industry. My answer to that must be that I am not aware of any similar schemes applying to other industries. I do not quite know what the point of the question was. I do not think that what may or may not have been done for any other industry is necessarily relevant to the introduction of these schemes for farming. Nor do I think that these schemes create a precedent as regards action for other industries. We have devised a means of meeting particular problems in regard to the agricultural industry, and it is a unique industry in its structure and in enjoying the long-term assurances of the 1957 Act.

The noble Lord also asked about new entrants: would they be precluded because they could not show that they had so many cattle or so much cropping last year? There, again, I think we have to confront this problem with common sense. The young farmer when he takes his farm for the first time will go to the market and buy cattle or sheep or pigs or poultry, and very shortly he will have some stock on that farm and have a cropping plan. It may be it would be wise for him to wait a few months, perhaps twelve months, before he puts in his improvement plan. But if he comes into the farm, as I am sure he often will, fully qualified and with an idea of what he is going to do, he will have no difficulty in filling up the form, qualifying for the scheme, and getting the assistance.

The fourth question that the noble Lord asked was about statutory smallholders. He then mentioned that my honourable friend in another place, had promised to write to the late Mr. Sidney Dye just before his death. It so happens that among the papers that I have here to-day I have a copy of the letter to Mr. Dye, so that that question was answered. But if the noble Lord would like to know what the answer is, it is a very simple and clear one: namely, that because you are a tenant of a statutory smallholding you are not in any way debarred, if you measure up to the other tests, from receiving grants and assistance under this scheme.

LORD WISE

I thank the noble Earl very much for that answer. I think that that is what the smallholders wanted to know. There was uncertainty about it.

EARL WALDEGRAVE

I do not wish there to be any uncertainty at all. They qualify on acreage and man-days, just as anybody else. The noble Lord, Lord Amherst of Hackney, gave us a very helpful speech in which he supported us, saying that there must be limits, that you really could not run a scheme at all—it did not make it practicable—unless there were limits. He then talked a good deal about the financial point, which was the burden also of the speech of the noble Viscount the Leader of the Opposition. If I may, I will deal with those two points together and try to make the position clear. It seems to have caused people a lot of difficulty. Perhaps the noble Lord, Lord Wise, will help me in the mental arithmetic that I now ask him to do. It will not be in decimals or vulgar fractions.

The total cost of the new schemes—I emphasise "schemes" because they include the supplementary schemes—we estimate will be £12 million. Of this £12 million £3 million is consequential expenditure (these are all estimates, of course) and is brought about by the greater utilisation of existing production grants in regard to ploughing, liming and so on. That £3 million is not taken into account in the Annual Price Review. So the position of the sum so far, if I take it slowly—and it is quite easy—is that we have £12 million minus £3 million, which means that we have £9 million. We build up this £9 million in this way. The sum of £3 million is found by the cessation of the marginal production grants, so now we are left with £6 million. That £6 million, which is the net additional cost of this set of schemes, will be in the Price Review. I hope that that is clear.

LORD STONHAM

My Lords, if the noble Earl will allow me to say so, it has been clear to us the whole time—it is stated in the White Paper. I said exactly the same thing the other way round.

EARL WALDEGRAVE

I am glad that it is clear to the noble Lord. It did not appear to be clear to other people, and I thought it better to go into it. That was really the burden of the speech of the noble Viscount, Lord Alexander of Hillsborough. Although he told me that he could not be in his place I thought he should have a considered reply. The noble Lord, Lord Stratheden and Campbell, spoke of this, too. I now turn to the noble Lord's point about whether in some way the money was the farmers' money and that we were being mean, as Lord Stonham said, in not making it new money. That was the other point made by the noble Viscount, Lord Alexander of Hillsborough. My noble friend Lord Amherst of Hackney dealt with this very well, because he said that every time that you put the guaranteed price of pigs up and that of barley down, or make any adjustment in the Price Review, you in fact re-distribute the money within the Annual Price Review balance sheet. I see the noble Lord shakes his head, but if the guaranteed price of pigs in the Price Review goes up and at the same time the price of something else comes down, that is a re-distribution within the global figure.

LORD STONHAM

That is very true, but there is a vital difference between the two methods of re-distribution. If you are re-distributing as between crops, all farmers can benefit or suffer from that re-distribution. But this Bill redistributes as between farmers, and arbitrarily includes some and excludes others. That is a new principle.

EARL WALDEGRAVE

We must carry this discussion on somewhere else, because not all farmers grow all crops and it is no real new departure of principle. In any case we must, I think, get this in perspective, because the total value of the guarantees is over £1,200 million, and the amount of Exchequer subvention is about £250 million. Again, this is a percentage sum. This £6 million is not a very high percentage.

The noble Viscount, Lord Massereene and Ferrard, paid tribute to the fact that this scheme would be of great value in Northern Ireland. I was glad to hear the noble Viscount say that, because I am sure that that is so. But I am afraid I could not go with him in some of the other things he suggested. He started off his impassioned plea by asking what could be done with £90. I would say that you can do quite a lot with £90, especially if it is going to be paid four times in three years. But we are talking about £1,000. That is the maximum that one can get under this scheme. We are paying it in instalments only because that is a convenient way both to the farmer and to the Government. The noble Viscount then went on to say that these grants were mean and too small. He wanted us to set up a Government machinery service again. I doubt whether, when he considers that again carefully, he will think that a very good plan. We are all in favour of machinery syndicates being set up amongst farmers, but we do not want to go into the business once again of having machinery services operated by Government Departments.

The noble Viscount, Lord Massereene and Ferrard, made a great plea, because of his interest in Northern Ireland, in regard to farms of less than twenty acres. The very next speaker, the noble Duke, the Duke of Athol], wanted the lower limit to be raised to sixty or eighty acres. It was very reassuring to the Government. For here are two speakers, both from our own Benches, demonstrating that we have got somewhere near the mark. A number of noble Lords from Scotland followed, and I was glad to see that though they had some slight criticism of the section of the Bill which deals chiefly with Scotland, as perhaps one would expect, they did give us general support for the Bill, which I was most grateful to receive.

The noble Viscount, Lord Stonehaven, who has had to catch a train, raised one question which I did not quite follow. He said there was no guaranteed price for store cattle. Of course there is no guaranteed price for store cattle. You cannot put a guaranteed price on every item all the way up the pipeline. But when you have a guaranteed price for the end product, that has the effect of giving a guaranteed price throughout. The noble Viscount, Lord Colville of Culross, went out of his way to say that although he had certain criticisms, which later were admirably met by my noble friend Lord Forbes, the Minister of State, those slight Scottish doubts which he had did not in any way affect the merits of the Bill and I was glad for that support, too.

Then we came to a most thoughtful contribution from the South, from the noble Earl, Lord Ferrers, but I was not quite clear on his first two points, because although he said he was going to make two points, as he developed the matter they seemed really to be the same point. If I may say so with great respect, I believe he fell into the trap of mixing up the farm business with the size of the holding. The whole point of all this is the potential that we believe is inherent in the small farm or small farm business that falls between the limits we have set—the potential for that man to go on as, I believe, the noble Earl, Lord Ferrers, said, to be a surtax payer. We feel that in that bracket of twenty to 100 acres, 275 to 450 man-clays, there are potential surtax payers; and we feel we have to give them a help forward so that they can go on and prosper.

We do not believe that all those who have already helped themselves and who are not now qualified for assistance, because of too many standard man-days, because their business is too big, or even the farming industry generally, are likely to be jealous and say, "Why should you help him? I was never helped." I was very much impressed the other day when my right honourable friend was addressing a very large meeting of farmers when a farmer, from far West Wales, if I remember rightly, got up and said, "When I began I started with a spade and an old grandmother"—or words to that effect—" and now, when I come to reckon up my farm, I find I am miles above your top limit in standard man-days." I waited to hear what he was going to say next and wondered whether he was going to say to the Minister that this was therefore very unfair. Nothing of the sort. For he said, "I am glad that people to-day will not have to go through all that I went through. Your Bill is quite right to give those people a start and a help forward." I think it is much more likely that those in the farming community, a community whose members are friendly to each other, will say, "I cannot get this help, I have got too big now; but I am glad that the other man is to be able to get it, and I wish I had had it when I was young." I do not think we need trouble with that. I feel sure we shall not be left with people saying that we are helping only the "duds". They are not "duds". We much prefer to look upon them as potential surtax payers.

The noble Earl, Lord Ferrers, asked for two assurances, both of which I believe I can give him. He asked whether large numbers of National Agricultural Advisory Service officers were to be moved down into my part of the country in order to cope with this Bill. The answer is that they are not. I have a note of this as I thought somebody might ask the question and I wish to answer the point carefully. No district officers have been transferred in connection with work on these new schemes. There have been transfers in these last months but they really relate to the re-organisation of the whole of the Ministry's work that ensued on acceptance of the Arton-Wilson Report. We have not made a change-round in that way to meet this scheme.

Then the noble Earl asked: "Will these advisory officers be allowed to go on advising, or will they turn into clerks, filling up these most difficult forms?" We have all to do a bit of form-filling in our lives—nobody can controvert that—but I can give an assurance that it is our intention to do the best we can to see that these officers are not swamped with paper work. We have this new organisation of the Ministry, with divisional executive officers, and we shall try to divert as much paper work as we possibly can out of the hands of the advisory officers.

I come now to the speech of the noble Lord, Lord Stonham. I was amused to see that, after telling your Lordships that when he was in another place he always retired to the Library when Scottish affairs were discussed, now that he has come to join your Lordships here he sat through all the Scottish speeches, and so much was he interested in them that he did us the great honour not only of listening to them but also of joining in. I was glad, also, that his interventions were soundly drubbed by my noble friend on these Benches. Perhaps now the noble Lord will revert to his former policy of "Where angels fear to tread". The noble Lord did say, however, that this was a mean Bill and he again raised the point of additional finance. I have tried to cover that in my previous remarks in answering the noble Viscount, Lord Alexander of Hillsborough.

I honestly do not think that that argument is a sound one, and I was glad of the support of the noble Lord, Lord Stonham, even if it was qualified; for he did give qualified support of this Bill. He said, if I recall rightly, that he would support it, "but not at the cost of serious harm to the industry." Nobody would support the Bill who thought it was going to do more serious harm with its left hand than the good it was doing with its right; and I really feel that the noble Lord's support will shortly be seen to be quite unqualified, for we are not going to do harm to the industry.

The noble Lord raised a very difficult point—it is a difficult point and it is no good burking the issue—of the under-20-acre potentially viable farm (that is the most terrible jargon, but the noble Lord will know what I mean)—the under-20-acre unit that might still, perhaps, measure up to giving a full living. My right honourable friend in another place has said over and over again that we have to start somewhere, and that we must get to the root of the matter in the middle of the bracket; and then, when we have gone on for a little time and seen how we are going, will be the time to see whether we can afford any ups or downs or can put other schemes in later on.

I should like to add one more point on what the noble Lord said on the National Agricultural Advisory Service, because I believe he will be comforted to know that the officers in that Service are themselves quite confident that they can cope with the scheme within the limits proposed. My right honourable friend would not have agreed to this bracket—this volume of work—had he not been so assured. The noble Lord really must give us a little credit for having given some thought in advance on this obviously difficult problem. We have thought it out and we believe that the burden of work which we shall lay on the Service can be borne; and the Service themselves say so.

Finally, the noble Lord voiced qualms about part-time and co-operation. I still feel that there is a misconception in the minds of some noble Lords about the part-time holding. There is nothing whatever to disqualify a part-time small farmer from receiving assistance under this Bill. He has only to show that the unit, the business which he is operating, is of a size which, measured by our measuring rods, would give an average living to one man. I think we cannot overstress that enough. If a part-time man can do in half-time what it takes another man whole-time to do, so much the better for him. He is not debarred—if he works on the railways or in forestry lie is not debarred—so long as the unit he is managing builds up to the right score of man-days.

I believe that those were most, if not all, the points which the noble Lord raised, except the point about co-operation. The noble Lord will know that that matter was raised in detail in another place, and provided that there is a genuine partnership or coming-together, and that it is not merely for the purpose of getting grants under this Bill, two small people who are below the limit can bring their businesses together to form one larger business and so become eligible.

LORD STONHAM

My Lords, the noble Lord has indeed answered in an extremely full and satisfactory manner the points I raised, which I know will give assurance to a great many people outside. There is just one point which he may have overlooked. Does he think it possible that the review of limits might take place after twelve months' experience?

EARL WALDEGRAVE

My Lords, I should not like to commit myself to that. I really think that it is hardly a question that I should answer. The noble Lord will understand, I am sure.

I do not wish to detain your Lordships any longer. I am quite sure that we have a good Bill here and that it is going to give help and encouragement to thousands of small farmers who are deserving of that help and encouragement.

On Question, Bill read 2ª, and committed to a Committee of the Whole House.