AGRICULTURE BILL

HL Deb 16 February 1967 vol 280 cc485-514

7.12 p.m.

Debate on Second Reading resumed.

LORD RATHCAVAN

My Lords, after that very historic interlude, which I hope that we shall see, at any rate occasionally, in the years to come, we return once again to the Agriculture Bill. This is very much an omnibus Bill. It deals with a great many matters and I propose to mention only one or two points. First, I should like to say something about hill farming; secondly, about the amalgamation of uneconomic holdings, and thirdly, about co-operation. I welcome the proposals for stabilising subsidies and other benefits which are proposed for hill farmers. After all hill farming is about the most hazardous of all forms of farming. I was a hill farmer in Northern Ireland for some years, and there the land was not good hill land; it was boggy, peaty soil, rather, I suppose, the same type as the soil you would find in Argyllshire. The sheep which I had on my farm were pure bred Blackfaced.

The dangerous time in hill farming is the winter and the early spring, before the new grass comes. After a severe winter, when the grass comes late, the ewes are weak and have little milk when the lambs are born in April. Often there is a bitter East wind in April—certainly there was in my part of the country. I remember that on one occasion during one of these bitter winds 22 lambs were born in one night. The shepherd did his best to put them in a sheltered place for the night, but when he came back in the morning 20 of them were dead. That is the kind of thing the hill farmer is up against. There is also the problems created by foxes and dogs. It is extraordinary how careless so many people are about keeping their dogs in at night. The animals go out and become killers on the hill. They can maim and cause the death of numerous sheep. Then there are vermin—for instance, the grey crows. I remember one occasion when a ewe was cast; that is to say, it had fallen over on its back and because of its big fleece, could not get up. While it was in that helpless state a grey crow pecked out both its eyes. The wretched animal was blinded for life. Fortunately the shepherd came upon it soon afterwards and the animal was taken down to lower ground. It lived on for several years and had a lamb every year, so that was not so bad for the poor thing, considering that it was completely blind.

Perhaps the worst of all hazards is snow drifts in winter. To-day the weather forecasts help the shepherds and very often disasters may be prevented, because if sheep can be gathered and taken to lower ground they can at any rate be kept together. But sometimes blizzards come without warning when the sheep are scattered over the mountain. I have lost as many as 100 sheep in one night; they were buried and smothered to death under the snow. I just mention these details, my Lords, in order to show the difficulties under which a hill farmer works and how much he deserves the subsidies and other benefits that he has received in recent years, and will continue to receive under the provisions of this Bill.

I should like to say a word about Part II of the Bill. I am especially interested in the provisions relating to the amalgamation of small uneconomic farms with larger units and how this will operate in Northern Ireland, where I believe that there are 20,000 farms of under 20 acres. It must be remembered that in Ulster there are no tenant farmers, because under the Land Acts, which began in the time of Gladstone in the 1870s (and there were later enactments right up to the 1920s) all the tenant farmers were entitled to buy their land from the landlords. Consequently, all the farmers in Ireland to-day, both North and South, are absolute owners of their land, subject, in the case of some later sales, to small terminable annuities.

We also have a system there called the conacre letting of land, under which small farmers can let their land for the season only to neighbours with larger farms. Let me give an example. A small farmer with 15 acres may let his land for the season under the conacre system for, say, £150. If he is an old man he will probably also draw the old age pension and he can continue in his house. Such a man, I think, would not wish to come under the scheme in this Bill, unless the grants which were proposed in the White Paper issued in August, 1965, were to be considerably increased. In regard to this point, I was glad to see that the present Minister of Agriculture, Mr. Peart, admitted in another place that the grants published in the White Paper were not sufficient and would have to be increased.

However, quite apart from the proposed scheme in the Bill, I am told that in recent years a large number of small farms in Northern Ireland have been absorbed by purchase into larger units, so that something has already been done. I believe that there have been recent talks between the Minister of Agriculture here and the Minister of Agriculture for Northern Ireland, and I wonder if the noble Lord, Lord Walston, could tell me whether any decisions were reached in those talks.

In conclusion, I come to Part IV of the Bill, which deals with co-operative schemes. This is an admirable idea, but how far will it work out in practice? That remains to be seen. I am afraid that the British farmer is not very co-operatively minded. Perhaps the greatest experiment ever tried in these Islands in agricultural co-operation took place in Ireland at the end of the last century and the beginning of this. With that scheme the name of Sir Horace Plunkett will always be associated. Under the scheme, co-operative creameries and other industries were set up. I think they were quite successful, but I am afraid that few of them remain to-day. This Bill is obviously going to become law, and I hope that its provisions will prove beneficial to the agricultural community.

7.25 p.m.

LORD SOMERS

My Lords, I want to deal with only one point in this Bill, and I promise to be brief. I refer to Clause 31, which deals with grants for fixed machinery. Presumably, fixed machinery includes batteries. Many noble Lords may accuse me of introducing the old bogey of humanitarianism again. Well, perhaps that is so; but it depends on how one looks at this: whether one regards the prevention of unnecessary suffering by defenceless creatures as a desirable thing or not. I happen to be one of those who do. I am not going to hold for a moment that the domestic fowl is one of the most intelligent of creatures. The fact is that it is very much the reverse. But one does not have to be very intelligent to suffer pain, fear and discomfort. Probably the more stupid you are, the more you suffer, because you do not realise either how to get rid of pain or how long it is going to last.

Of these three elements, the first, pain, is rather a doubtful quality so far as batteries are concerned. Whether de-beaking causes pain, I am not prepared to say, but it certainly causes discomfort. The other two are quite certain. I can see my noble friend Lord Ferrers sitting there, all ready to say that the birds are kept in an extremely comfortable and warm situation, protected from bad weather. But, with all due respect to my noble friend, that really is absolute nonsense, because surely that is making the birds into human beings. If one were a human being, I do not think one would like to spend one's life sitting strapped into a chair in the comfort of a warm room and, what is more, having one hand cut off so that one should not hit the man sitting in the chair beside one. There is no doubt that battery birds live a totally unnatural life. They get no exercise; they live in semi-darkness, with never a glimpse of the sun and, in present circumstances, with not enough room even to stretch their wings. On top of that, there is this question of de-beaking, which must cause discomfort at least.

Apart from the humanitarian aspect of this question, let us look at the quality of the product of batteries. I was reminded only last week that this is Quality and Reliability Year. If we want quality in eggs, we shall certainly not go to a battery, because there is nothing on earth more tasteless than a battery egg. I think it should be made compulsory to label them as such, so that they should not be sold in shops as normal eggs. They are even worse than deep-litter eggs, which are themselves not nearly so good as free-range eggs. From all points of view, batteries are not desirable machines, and I wish that the Government could make it possible to exclude them from these desirable grants for fixed machinery that are included in this Bill.

7.30 p.m.

VISCOUNT STONEHAVEN

My Lords, I want to speak only briefly on this Bill. To begin with, I should like to say that although there are benefits from the Bill, there is no substitute whatever for proper prices for agricultural produce, and I hope that the Price Review which is now on the way will recognise this fact. This is a palliative, perhaps, but it is no cure whatever for the real problems which the industry is now facing.

I desire to seek some information on Part I in regard to farm and structure improvements, and the promotion of agricultural investment. Clause 26(1) says: The appropriate Minister may in accordance with a scheme… Who makes that scheme? Am I right in assuming that you can make a scheme yourself as a landlord in conjunction with your tenant? Or who makes it? The clause just says, "in accordance with a scheme". It goes on to deal with an "uncommercial unit", but qualifies it by saying that an uncommercial unit shall be owned and occupied… Does that mean to say that unless you own and occupy it a tenant cannot get a golden handshake? I do not understand this. I apologise for my stupidity in not being able to undersand it, but perhaps it could be made clear.

I come now to another matter on the same subject, in Clause 27. The words which appear in Clause 27(1) are: an individual who in prescribed circumstances… What are the prescribed circumstances? You cannot see them anywhere in the Bill—at least, I cannot. Then the clause goes on to deal withan uncommercial unit of land, and so on. I should like to know whether a landlord, if he agrees with his tenant and everybody else, can join two intermediate units and make one commercial unit. An uncommercial unit, yes. But can you join two intermediate units? This is not clear to me, although probably it is to everybody else, and I should like, if possible, to have it ironed out. Later on, talking about these units, the clause says: calculated in a prescribed way … What is the prescribed way? It does not tell you that. Then Clause 27(1) paragraph (c) says: subject to the provisions in Part III of this Act, in accordance with arrangements approved by a Rural Development Board as being for the purpose of facilitating the a forestation of land in the area of the Board. I earnestly hope that we shall never have Development Boards in Scotland; and, anyway, we shall not have them for six or seven years, because I am thankful to say that we are well down the list of places that are to be afflicted with these other people to manage their business. But it seems to me (and this point was mentioned, I think, by the noble Lord, Lord Nugent of Guildford) that if you have an agreement to dedicate land to forestry with the Forestry Commission, this should be good enough. I think "a development board" should come out, and the words "and/or", or something of that sort, be inserted instead.

I want to note, in passing, a very unusual act of generosity on the part of the Treasury. It is so unusual to have an act of generosity on the part of the Treasury that I wonder if they have noticed it. It is on page 22 of the Bill, where it says that the annuity can be enjoyed by the wife. Quite frequently, an antique Highlander takes for his second wife a young and bonny lassie of 17 or 18, and it seems to me that the Treasury will be paying that annuity for a very long time. This is most generous of them, but I do not suppose they have thought about it.

Perhaps I may point out one other matter. Later in the Bill the Minister takes to himself powers to take on a part holding while waiting for it to be made into a commercial unit. There is a danger here which I am surprised is not covered. Here it not only says that he may amalgamate and so on, but uses the words "to use the land". I should have thought that the temporary tenant, who can be turned out without security of tenure, should at least be given the option of the combined unit when it becomes a commercial unit. Otherwise, this is merely an invitation to the Government to nationalise land. I think this is wrong. I do not think it is in the interests of the farmer, and I think that this protection should be given to the tenant farmer, so that one or other of them makes sure that the tenant farmer gets it and the Government do not set up a bureaucratic institution.

If I may now take up one other point, which was mentioned by the noble Baroness, Lady Elliot of Harwood, it is the question of fixed normal plant and so on. I should, of course, have declared an interest here before I started, but I think everybody realises that I am up to the hilt in interest in this. I am not quite so sanguine about this business as the noble Baroness appears to be. I have installed a dryer, and have equipped it with a tractor-driven fan, and the reason I did this was because the electric distribution system in Scotland is single-phase. A high-powered single-phase motor is an expensive thing. There are technical difficulties in starting it; it can be done, but it is not easy, and it is not like a three-phase. If I had installed an electric motor to drive this fan, I should have got grant on it without question. But this would have been a stupid thing to do. In my own particular grain dryer I have one Aga fixed by a couple of bolts which fills the thing and this gives grant. Then I have three bins and I empty those bins with another. That does not give grant although it is exactly the same Aga. My fan does not give grant. My heater does not give grant. How are you going to work a grain dryer without a fan or a heater. Of the ducts that take the air through the grain, the portal, as you might say, which is bolted to the concrete, gives grant, but the duct from the portal which carries air to the grain does not. Schedule 4 of the Bill lists all the various items on which you can get grants, and paragraph 17, which has been added, says: Any operation incidental to any of the operations specified in the other paragraphs of this schedule or necessary or proper in carrying it out or securing the full benefit thereof. I should like an answer to this. If that does not cover the point of the integral parts of a dryer, if you cannot operate without it, I do not know what does. It appears to cover it. But I am quite sure that if I think it does, it does not! Therefore, I should like the noble Lord to make this point quite clear.

7.40 p.m.

THE DUKE OF BUCCLEUCH AND QUEENSBERRY

My Lords, I am sorry if I am delaying the conclusion of the debate, but I will be very brief. I feel that this is a Bill which deserves a wide discussion. I should like, also in a few words, although it does not deal with all the major problems of farmers, to thank the Government and the noble Lord, Lord Hilton of Upton, for bringing forward proposals which are due from time to time and provisions which will be beneficial to agriculture and to production from the land.

I would refer briefly to advantages in the voluntary amalgamation of small farms in cases where they are unlikely ever to be economic, with a better distribution of fields among adjoining farms. Also, I should like to add a reminder that this should be done with considerable care and knowledge of the circumstances, and not necessarily in all cases, as I am sure the noble Lord realises, as others do, that there are very many occasions where a small farm may not be economic to one person but it can be to another, and can provide a very useful stepping-stone to a person on his way to a bigger farm. These amalgamations have been practised by landowners where opportunities have occurred, and it is satisfactory that this action has been in accordance with official policy; and I feel it can be continued by individuals as well as under Government auspices.

In this matter, and more so in other parts of the Bill, including the changeover from allowances to investment grants, the procedure seems to be more complicated than is necessary and to bring more complications and delays and cost to farmers and those concerned with the management of land and farming. Perhaps also it may involve less freedom of choice of production from the land. I should like to feel that simplifications may be possible during the further stages of the Bill.

I do not find a friendly welcome for Rural Development Boards, or that in Scotland any wish, or need, has been shown for them to be set up. I am happy to think that there have been indications, which I hope will continue, that there will be no hurry to set them up and that there will be a careful watch first on such Boards which are set up in other places in the United Kingdom. I think we all agree that the selection of membership of these Boards is very important indeed, and some of us are anxious that it may be difficult to secure for them the services of persons of the greatest wisdom and experience, who are probably already fully engaged and employed in their own work and in many other local government and other local works.

This is not a Bill for the protection of forestry, but the growing of trees comes into it. There is an appearance of discouragement and more control for private forestry, rather than encouragement of private forestry. In so far as land may be released for forestry by these Boards, it seems that preference and advantages are mainly for the Forestry Commission, and there is not equality for all who are willing to help the nation by growing trees and producing more timber. And yet locally, when sites are released for forestry and are distant from Forestry Commission forests, and when acreages are small, the planting and management are much more suitable to be done by individuals on the spot; and the Forestry Commission quite properly do not want to be bothered too frequently with places which they know are less suitable to themselves.

I was relieved to hear the noble Lord, Lord Hilton of Upton, state that consideration would also be given to private forestry. I should like to ask whether it is accidental or deliberate in this Bill that a preference seems to be given to the Forestry Commission with an advantage over other growers; and, if so, why this is. The two branches of forestry, State and private, work very closely together. I work very closely with both, and I am sure that all in forestry want each to make its maximum contribution, one helping the other, and conversely. We should like to believe that Government and Parliament want an expansion of forestry by all who can do so.

Occasional references are made to what the Government will do for forestry, but this seems to be one of those things which are everyone's responsibility and which are always being postponed. I do not suppose that this is the occasion to go into forestry very much, but as it has been mentioned in the Bill I feel it is justifiable to emphasise a few words which I hope will be taken up by those more concerned with it. I trust I shall be excused for a few very gentle points of disagreement; and I hope this Bill will be further improved in this House.

7.47 p.m.

EARL FERRERS

My Lords, we have had quite a long debate and it seems indeed extraordinary that this Bill, which originally started so long ago as Novem- ber, 1965, has at last come up to your Lordships' House. At one time I wondered whether it would ever reach us. It certainly had a thorough vetting in another place when there. I was delighted to see the noble Lord, Lord Hilton of Upton, put the Government's case this afternoon, because he, like his noble friend Lord Walston—I was going to say are fellow travellers. If I say that, I do not mean it in any form of derogatory political sense, but merely that they hail from the same part of the world as that from which I come, and it is good to see two people from East Anglia put the Government's case. I only wish it was a better one, but it is good to see them.

The noble Lord, Lord Hilton of Upton, said he had some pride in moving this Bill, but I think that as the debate went on his pride must have withered somewhat, because most of the debate seemed to consist of criticism. Indeed the Bill did not evoke the welcome his pride must have anticipated, because even from his own Party he managed to succeed in getting only one noble Lord to back up this "wonderful Bill"; and he, the noble Lord, Lord Wise, took the biggest swipe at the Bill of any noble Lord who has spoken. I reckon that Lord Hilton of Upton's Bill has had a pretty rough ride one way and another this evening. But he hoped it was a great Bill, and I think the Minister of Agriculture in another place certainly said that this was a great Bill. We had a big Agriculture Bill in 1947 and one in 1957, and I think the idea was that as this was 1967 this Bill also would be a great Agriculture Bill.

I do not believe it is a great Bill. It has many good points—it certainly has—but it has bad ones, and no real beacon shines out from the Bill pointing the way ahead for agriculture over the next decade. There is nothing in the Bill which will restore to farmers the confidence which they have lost during the last 18 months or so. There is nothing in this Bill which will give them the feeling, "Now we know where to go. Now we have the light, and we can invest and go ahead". This is what agriculture wants. This is what farmers want. This is what they have not got, and this is the opportunity which the Government, in this Bill, have missed. Instead of producing a Bill which will give farmers the confidence which they require, the Government have produced this Bill which contains a major amount of minor alterations and a minor amount of major ones—and I certainly do not intend to comment on each and every one of them, otherwise we shall be here until tomorrow and longer.

The whole of Part I of the Bill is devoted to setting up the Meat and Livestock Commission. This is a huge undertaking, and a brave one, and I certainly hope that it will prove successful. It will certainly prove expensive. The noble Lord, Lord Wise, had some severe doubts on this, and I have even heard that the suggested cost by the Verdon-Smith Committee of £2 million a year is an underestimate of considerable magnitude. I wonder whether the noble Lord, when he replies, can give us any idea at all how much this will cost to run.

So much of the success of this Commission, as of all Commissions, will depend, of course, on the people who are appointed to it. In this Bill the practice of the Government has differed slightly from that which has been evident in some other Bills, in which the members of the Commission have been announced before the Parliamentary proposals have been approved. I wonder whether the noble Lord can give us any indication who the members of the Commission will be, and indeed when the Commission will be set up. This is the thing in which all farmers, traders and slaughterers are interested. To set up a Commission such as this is a big undertaking, and many eventualities must be catered for, but the sympathies which many people—noble Lords on this side of the House, farmers, traders, slaughterers and people in the meat industry—have for this Commission and its chances of success are lacerated by the sweeping and crippling provisions of Clause 9.

To my mind, this is an obnoxious clause, the cause and need for which has never been adequately explained. Nor has it been explained this afternoon by the noble Lord, Lord Hilton of Upton. It allows the Commission to "compel or encourage", and it is interesting to note the juxtaposition of those particular words and the priorities given to them. It is not "encourage and compel". It enables the Commission to compel and encourage people to do various things, and it enables the Commission to put a man out of business, whether he is a producer, a slaughterer or a trader. Why? The only reason we have been given for this (and it was given in another place) was that we must make provision for the unforeseeable future. I do not believe that is a sufficiently good answer. I think it is wholly wrong for the Government to take such wide and crippling powers without a specific purpose in mind. If there is a specific purpose I suggest that we should be told about it, and if there is not a specific purpose, these wide powers should not be taken.

Turning to the clauses which deal with farm structure, the amalgamations which are envisaged and the grants which are going to be made to encourage them, here, speaking personally, I congratulate the Government. They have grasped a very prickly nettle. In my view, they were quite right to do so, and equally right so to draft the clauses that any forms of amalgamation on this score should be voluntary and not compulsory.

Farm structure over the next few years is going to alter; circumstances will make it alter—and here I am not thinking only or necessarily of small farms. I believe the future will show a polarisation of the size of farms into, on the one hand, extensive farms of a larger nature and, on the other hand, smaller intensive family farms. It will be just as unviable in the long term to be an extensive farmer who is not large, as it will be to a small farmer who is not intensive. Units must get bigger, and I think the Government are right to give this encouragement. Whether the carrot contained in the Bill will be big enough to make the donkey run is another matter. I personally doubt it, but no doubt the Government will watch this point carefully. But the sad and the odd part about this is that the policies of the Government are running directly against each other. Their left hand does one thing, and their right does another.

Here is the Minister of Agriculture, encouraging the elimination of unviable units and encouraging, by amalgamation, the increase in the size of units. This is right and wholly acceptable, for larger units are a fact of economic life, whether one likes it or not. But what does the Chancellor of the Exchequer do? With his estate duty and capital gains tax he deliberately and specifically causes the fragmentation of units. I am not just making a Party point here, and I hope the noble Lord, Lord Walston, will seriously consider this, because I intend to show him factually the stupidity of the present situation. No one can call a 40-acre farm a large one, nor even a 90-acre farm, and one can well visualise an amalgamation of them into a 130-acre farm, which would be a sensible and logical thing to do. Any farmer so amalgamating two units will get a grant upon them, and if this comes about the unit must stay as one for 40 years. I stress this period of 40 years because it is an important factor in this example. The unit must stay as one for 40 years, otherwise the grant is returnable.

Let us now consider the fate of the owner-occupier of 130 acres. Since 1938 inflation in this country has increased at about 4 per cent. Compound, and it is a reasonable assumption to make that it will continue at this rate. Let us assume that in 1945 an owner-occupier bought a 130-acre farm for £11,000. By the mere processes of inflation, without any real improvement being made to his farm or his holding, in 1965 that holding would have been worth £25,000. It would have gone up from £11,000 to£25,000 in 20 years, and by 1985 it will have gone up to £55,000—by the mere processes of inflation. The owner-occupier dies in 1985, 40 years after he purchased his farm. Along comes the Chancellor of the Exchequer and claims, in capital gains tax and estate duty, £16,700—more than the whole of the sum of money which the owner-occupier paid to purchase his farm in the first instance. The Chancellor of the Exchequer claims what is in fact 30 per cent. of his total assets. In order to find this money, what do his executors do? They sell—and they have to sell—40 acres.

So we have the ridiculous situation of the Chancellor of the Exchequer splitting up a 130-acre farm into a 90-acre unit and a 40-acre unit, and at the same time the Minister of Agriculture, Fisheries and Food paying a grant to join the two units together again. I suggest that as individual tactics the Government may be able to argue each case forcibly, but as overall strategy I would suggest that such dichotomy of views is mad. I am glad to see that the Government have decided to continue with the Farm Improvements Scheme. I have always considered this to be one of the best methods of spending money on agriculture, because it encourages the farmer and helps him to equip himself capitally for the future, and by such capital equipment to lower his costs of production. I am, however, sorry that the Government have seen fit to reduce the size of the grant from 33⅓per cent. to 25 per cent. I know that the argument is that although the subsidy is less, it is spread over a wider area. That is a perfectly valid argument to have and to project. But personally, I think it is wrong, for the value of the one-third grant, which is a very substantial grant, spread over a smaller area is a far greater incentive to the farmer to invest his money than is a system whereby the farmer has to find 75 per cent. of the total capital cost. We are getting into a state of a proliferation of little grants and regulations which will do no one any good.

Earlier this afternoon I asked a Starred Question about how many grants there were that are applicable to agriculture, and to my intense and huge surprise the noble Lord opposite told me there were only 16—I think he said 16 farming grants or subsidies. I was greatly surprised. I thought there would have been 150. But it only goes to prove the point, that these 16 grants and subsidies have so many bits and pieces twisted on to them, added on to them, and so many restrictions on them, that the comprehension of them becomes almost impossible. I only hope that the noble Lord will stick by the assurance which he gave me in his supplementary reply, that everything will be done and is being done to keep them as simple as possible because, with the greatest respect, this is not the case with this Bill. It makes grants far more difficult to comprehend and far more difficult to interpret.

I do not for one minute suggest that the Government support of agriculture should be curtailed, but I do suggest that it should be rationalised and that the grants available should be fewer and bigger. And no one will suggest that will not make things simpler to run, cheaper to administer and easier to understand.

There is even provision in Clause 31(1)(c) for a 10 per cent. grant to be payable on an improvement, provided that the improvement is not already covered by another grant. It seems to me that we are getting to a position of absurdity. I do not decry grant aid as a system to encourage investment, but I do not believe that a 10 per cent. grant will encourage anyone to invest. I think that the economists in the Ministry of Agriculture are being given too big a heyday, adding bits here and subtracting bits there, so that the farmer does not know where he is, to what he is entitled or what is expected of him. I would suggest that the noble Lord, Lord Walston, takes this message over grants back to the Ministry of Agriculture. Quite simply, they should be bigger, fewer, simpler.

Nevertheless, I congratulate the Government on making what may appear to be a small but what is, in fact, a very significant change to the Farm Improvement Scheme; namely, changing the criteria on which the farming improvement grant is paid from the "prudent landlord" test to the "prudent owner-occupier" test. In the past, far too many sound and sensible schemes were strangled by the restrictive noose of the "prudent landlord" test, and this alteration is wholly commendable.

Similar reflections to those that I have made on these grants can be made in respect of Clause 32. Here the Minister has replaced the old investment allowance on tractor and combine with an investment grant. In the old days, one could work out in five minutes the written-down value of a tractor. Not so under this Bill. A farmer will in future have to apply for a form and fill it in; and the form is then to be shunted backwards and forwards within the Ministry for no less than two years, in order for the farmer to reap two payments of grant, the aggregate of which will be less than the total to which he was entitled before. This is a shocking waste of time and money, and it is a method of which I suggest the noble Lord, Lord Walston, should be ashamed. I do wish that even he—though I suppose this is too much to ask—could stop this bureaucratic machine from expanding like some huge amœba over everything, spreading its protoplasm everywhere. It has become quite impossible. I believe that it is a grossly unnecessary and retrograde step on the part of the Government, and it cannot in the long run be to the credit of agriculture or the taxpayer.

My noble friend Lord Nugent of Guildford said that agricultural indebtedness and overdrafts now exceed £500 million. The sad part—and the noble Lord, Lord Walston, knows this—is that over the past decade or so capital investment in agriculture has not come out of profits, as it should have done, but out of extra bank borrowing. This has been possible mainly by virtue of the fact that inflation has increased the value of the land, which has frequently been used as a security for the borrowing. This is not a healthy situation. In my view, far more of the capital investment in the future ought to come out of farm profits, and I wish that I thought this Bill would do more to see that it does.

My Lords, there are many Parts to this Bill, and I have chosen to comment on only a few of them. If I appear to have been critical, I hope that the noble Lord will understand that it is not just for the sake of being critical, and that such criticism as I have made does not apply in equal proportions to all Parts of the Bill. I think that this Bill has good Parts to it and good points in it. I should like to give it a warm welcome, because Bills designed to help and encourage agriculture deserve a warm welcome and every encouragement. But my welcome to this Bill is not so great as it should be, or as I should have liked it to be, for two basic reasons. First, it deliberately sows into agriculture more controls, more restrictions, more form fillings and more regulations, at a time when these should be reduced. Secondly, it fails completely to strike the note which it should strike, and for which agriculture is yearning; namely, that of giving a strong guiding light to agriculture for the future and to farmers in particular, to show them what is wanted of them, and what is expected of them, in the years that lie ahead.

8.8 p.m.

LORD WALSTON

My Lords, it is for me a great pleasure to take part once more in an agricultural debate. I do not know whether I should declare an interest, because I am not quite certain whether I am in fact a farmer or not. I am perhaps what some people might call a weekend farmer. I criticise my son's farming when I go home. But I cannot really pretend to be actively engaged in it myself, so possibly I have no direct interest to declare, but I still have a very great interest in this industry. I have enjoyed listening to this debate, and I am grateful to those noble Lords, and it is the majority of them, who have given a welcome to this Bill.

I must confess at the beginning that I find myself in basic disagreement with almost every noble Lord who has spoken, because the attitude which has been taken is to say—and I hope I am not misrepresenting the general view—that the Bill has good points but that it does not get down to the fundamentals of agriculture; it skates over them. There I disagree. After all, what are the fundamentals of agriculture? What does agriculture want? It wants security, it wants an assurance against violent changes, and it wants a knowledge that its products will be needed in increasing quantities. It wants all of those things, and I suggest to your Lordships that it has got them. It has the 1947 Act and it has the 1957 Act, both of which give those securities and assurances against violent changes. Provided agriculture is prepared to believe them—and, of course nobody can insist, particularly a politician, that his words are believed—it has had a whole series of statements from the Prime Minister, the Chancellor of the Exchequer, the First Secretary and many other Members of the Government to the effect that agriculture is not only important to-day, but has an ever-increasing role to play in the National Plan. It has all those things.

But that is not enough; it needs more. What it needs in order to increase its already great competitiveness in terms of the rest of the world is a sound basic structure. In the first place, it needs a sound marketing organisation to close that gap that we so often talk about between the producer and the consumer, and it needs a courageous tackling of a problem which we do not hear so much about now—although in the old days we used to hear of it, and it is still with us—that of the marginal farm.

I suggest to your Lordships that this Bill tackles those three points. It tackles the structure in farming by the provisions which have, on the whole, received a welcome from your Lordships, and I am grateful for it. There is this scheme for the voluntary amalgamation of farms—and I repeat, as my noble friend made clear at the outset, that this is purely voluntary. The noble Earl, Lord Ferrers, wondered whether the carrot was sufficiently strong or attractive to make the donkey run. I do not know if it is. But the donkey has been running for quite a time. Over the years there has been a process of amalgamation of holdings. There has been a process of the running down of small farms, marginal farms, inefficient farms—call them what you like—by degrees. Often after their total productivity and the national capital expended on them has been largely squandered, they have been amalgamated into larger units. That is why the average size of our farms is mounting steadily, in spite of the impact of death duties which has been with us for a long time. That has been happening.

One may say: Why bother to do anything else about it if it is happening? There are two reasons why we should do something about it. One reason is that it is not happening fast enough for the efficiency of the industry in which we are all interested. The second reason is that, when it happens without any carrot at all, it entails a considerable degree of hardship on those farmers who are farming these marginal farms, wondering if they should give up. They are old, possibly; they are inefficient; they have not the training; they are under-capitalised, or whatever it may be, for the struggle on their farms, because they cannot afford to give them up. It is a great hardship to themselves and a squandering of the natural fertility and resources of that land. This carrot has been added to the natural economic processes—interference, if you like, with the natural economic processes, which some noble Lords may deplore; but they are in order to encourage a natural process, to make it go faster in the national interest, and to remove much of the hardship which in the past has gone with it. That, I repeat, is striking at one of the fundamental problems of our agriculture to-day—assisting our farms to become viable units, to cope increasingly with the conditions, not only to-day, but ahead.

Secondly, it tackles the marketing problem with livestock. I am most grateful for the kind words which, almost universally, have been expressed in favour of the provisions for the Meat and Livestock Commission. Of course, some of the comments have been somewhat contradictory. At one point the noble Earl, Lord Ferrers, praised the words of my noble friend Lord Wise, who unfortunately was not able to remain until the end. He then went on to criticise Clause 9 which, as he thought, gave frightening powers to the Commission. On the other hand, he may remember that my noble friend Lord Wise criticised the Commission on the ground that it had not teeth to it. He wanted more. So, in spite of some superficial resemblance between the noble Earl and my noble friend, when they get down to discussing the Livestock Commission I think they will find several basic differences between them.

However, we have tackled this important problem, one of the most important problems of marketing in the whole of the agricultural field. That is another fundamental approach. There is the continued assistance to co-operation in all its forms. I will come back to this and deal in more detail later with some of the comments made about that. Again it is something which I think everybody agrees must be dealt with in our agriculture. We do not want agriculture consisting solely of great farms, enormous farming enterprises, ranches of 10,000 acres or whatever it may be. We do want to have the small farmer still having ample opportunity. If he wants to give up, we have the scheme for voluntary amalgamation. But if, as I hope, he wants to stay—and I know that many of them will—he must be assisted by various forms of co-operation, not only in marketing, but in the ownership of the machinery, and in the actual cultivation of his soil, and so on. Some of them do it already. So much the better. But here is positive assistance to help them in this.

Finally, there is this question of what, as I said, was in earlier days called the marginal farm and the marginal areas of agriculture. There we are bringing in the Rural Development Boards to deal solely with this problem of a whole area, not necessarily within the boundaries of any one local government area, but within natural agricultural boundaries where the standard of living, because of the climate, because of the fertility, because of the communications, or whatever the cause may be, is too low.

I apologise in advance for detaining your Lordships, but many points have been raised, and I do not want to miss too many of them. Much has been said in criticism of these Rural Development Boards. With respect, I think that most of the criticisms are based on an entire misunderstanding of what these Boards are supposed to do. In the first place, let me make it quite clear that there is no suggestion that these Boards will be widespread throughout the whole country; that they will march from Wales up across the Pennines, up to the Borders into the Highlands, and back through Yorkshire, and even into East Anglia. There is no suggestion of that kind at all.

The first of these Boards has not yet been decided. Where it will be I do not know. Who will be the members of it, who will be the chairman of it, I cannot say. But I can assure your Lordships that the chairman will not be, in the words of one noble Lord," an ambitious Socialist alderman". I can equally assure your Lordships that he will not be an effete and idle Conservative Peer. Whoever he is, he will be chosen because he is a good man who knows his job; who has ideas and is capable of undertaking this important activity. The activity is to ensure that the selected area, instead of becoming a rural slum steadily going downhill, with people leaving it, roofs falling off the houses, weeds growing where crops should grow, or used to grow, and so on, is developed in a way which will be good for the country as a whole. Whether it is going to be developed in the way of large-scale sheep farming and extensive farms, or whether it will be developed purely for forestry or for amenities, tourism or whatever it maybe, I do not know. It will be for the Board to decide that. It must have sufficient power to develop the whole area in that way. That is why it has these powers over forestry.

A good deal has been said on this matter, but in view of the functions of the Board which I have described to your Lordships it is clear that if an area is decided upon by the Board as being, for example, an adequate place for a particular form of tourism, one cannot have a private a forestation scheme put up in the middle of it which will spoil the whole plan. It must be co-ordinated and controlled. The same goes for the Forestry Commission; but as the Commission is a national body it will, from the beginning of this scheme, work in so closely with the Rural Development Board that there is no need to make special provisions in the Bill. It is not going to be treated any differently. All forestry, whether Forestry Commission forestry or private forestry, will be co-ordinated into the development of this particular area.

So I suggest to your Lordships that in these four ways this Bill is striking at some of the fundamental weaknesses in our present agriculture structure, and, coupled with the statements of members of the Government and the previous 1957 and 1947 Acts, I believe it provides the basis for a still further advance of our own agriculture.

I should now like to deal with some of the points which have been raised during the debate. The noble Lord, Lord Nugent of Guildford—and I thank him for his very thoughtful speech—talked about the whole question of livestock farmers' confidence, the collapse in the autumn of confidence in livestock prices, and so on. I do not deny that there were very serious misgivings among farmers during that period, but I believe that those misgivings were largely ill-founded. After all, we know that livestock prices fluctuate. It is because we know of those fluctuations that our present system, which Lord Nugent of Guildford appears to want to change, including the whole price structure and deficiency payments, was brought in; so that even if the market price drops, the final result to the seller, the producer, if not absolutely constant, at any rate does not drop in a corresponding way. That, I believe, is the right way to do it. Although I freely admit that the sellers of stall cattle did suffer at that time, they would have suffered very much more had there not been the system of support prices and deficiency payments which we now have and which the noble Lord and, I imagine, his friends wish to do away with.

I should like to remind your Lordships and the farming community as a whole, when they talk of a lack of confidence, of what has been done for livestock producers in the last two years. There is a useful little list in the last two Annual Reviews. The guaranteed price of fat cattle was raised in the first Review by 4s. and then by a further 10s. per cwt. in the second Review. The new beef-cow subsidy has been introduced; the rates of the hill cow subsidy have been raised, as have the rates of the calf subsidy. The guaranteed price for sheep has been raised; and the hill sheep subsidy has been put on a continuing annual basis. In the light of those actions over the last two years, I do not see that there is any justifiable reason for lack of confidence over the long term. I agree that there are periods when prices drop rather low; but there are other periods when they rise rather high. We have just been through a had one, and have come out of it. But that is not a reason either for losing confidence yourself, or, if I may say so, for encouraging other people to lose their confidence.

The noble Lord, Lord Nugent of Guildford, mentioned A.M.D.E.C. and asked some questions about it. I was very glad he mentioned it. Obviously one listens with great care to everything the noble Lord says, but more particularly when he speaks with such authority on A.M.D.E.C. itself. I should like to thank him, both personally and, if I may, officially, for the magnificent work he has done as chairman of that body. I think we must bear in mind that although it is true that a considerable proportion of the grants which A.M.D.E.C. have recommended have gone to the assistance of co-operation, their sphere of activities goes very much further than that. After all, the scheme covers marketing generally, and any responsible person or body with an interest in the marketing of agricultural and horticultural produce may apply for grant, provided the proposal which is being put forward holds out the prospect of benefit to producers. So I am quite certain—and I hope the noble Lord shares my certainty in this—that when the new Council is established to deal with co-operation there will still be a great deal of scope for A.M.D.E.C. in the more general fields of marketing. I hope that any fears he or his colleagues may have on that score will by now be dissipated.

LORD NUGENT OF GUILDFORD

My Lords, may I interrupt the noble Lord to say that I did not express any fears on that?

LORD WALSTON

I think that I was rather transposing and thinking of the fears which the noble Lord, Lord Balerno, expressed on P.I.D.A. Perhaps I might come to that also, and assure him that there need be no fears of any kind for any of the staff of P.I.D.A. Clause 22 (1) provides for the transfer of the assets, liabilities and obligations of the Authority to the Commission. This covers a number of matters, but not least the liabilities and obligations of the Authority to its staff. These include any contracts with the staff and any other obligations there may be with respect to their employment. So that, subject to any changes, the staff will be employed on the same conditions as exist at present with regard, for example, to such matters as periods of notice on both sides for the termination of contract. In this respect, the position of the staff in relation to the Commission should be exactly as it was previously in relation to the Authority. The Commission itself will make its own arrangements with its staff, but in the long run there will be so much wider scope for the Commission that there is no fear at all that there will be any diminution of its activities.

The Common Market was another matter that was mentioned by the noble Lord, Lord Nugent of Guildford. The words he used were that the Prime Minister was now assiduously wooing the Six. He further suggested that, in carrying out this wooing, the Prime Minister must have formulated our own agricultural plans so that he could discuss it with the Governments of the Six. The noble Lord went on to suggest that, that being so, there was no reason why British farmers and your Lordships should not be told what those plans are. I think that that is in some measure—although I know it is entirely unintentional—a misrepresentation of the present situation. These visits to the members of the Six are in no way the visits of a wooer. They are visits in order to explore, to discuss, to find out. They are exploratory in the widest sense. I can assure the noble Lord that there are no detailed, worked-out plans for the shape of British agriculture when we sign the Treaty of Rome or anything of that kind. If we sign the Treaty of Rome—and, as I think most noble Lords here know, I personally hope that we shall—we shall clearly have to discuss the whole question of our agricultural policy. But that is not to-day and it is not to-morrow, and what we are dealing with to-day is the situation as it is to-day and to-morrow. Therefore, I think it is right for this Bill to confine itself to those matters.

The noble Lord, Lord Henley, was in many ways very kind to us. He said that we were making a jolly good try to solve the problems which have been with us for a long time. He spoke of a laudable attempt, and matters of that sort. He was somewhat lukewarm in some of his other comments, although I do not object to that. I think it is natural, particularly coming from the northern climes, to be lukewarm about some of the things which are done in Whitehall and in Westminster. But I am glad that he agrees that what we are doing is on the right lines, and I hope that what I have said has allayed some of his fears that we are not really getting down to the fundamental problems.

The noble Lord, Lord Wise, told me that he was unable to remain to the end, because he had to catch his train back to Norfolk, and I think I have already dealt with most of his comments. He mentioned the point that in his view farmers were tired of receiving advice. I must say that I do not subscribe to that view, even though the noble Baroness seems to nod her head in agreement with the noble Lord. But from such little experience as I have and from the information I get, it seems to me that the services of the National Agricultural Advisory Service are far more in demand now than they were five years ago or ten years ago, which is not an indication that the farmers do not want to receive advice. If it is good advice they will receive it. The services of the Milk Marketing Board are very much in demand and have had an enormous impact on raising the efficiency of our agriculture and of our dairy herds. So I would not subscribe to that view at all.

I hope that I have dealt with the remarks of the noble Earl, Lord Dundee, on forestry and on the general problem of the Rural Development Boards. The noble Baroness, Lady Elliot of Harwood, made, as always, a very valuable, interesting and well-informed speech, though I would say, on the question of drawing the line between where you get your investment grant and where you do not—and other noble Lords raised this matter, too—that it is always possible to find examples of ridiculous dividing lines. The noble Viscount, Lord Stone haven, mentioned some, too. A line must be drawn somewhere, and wherever the line is drawn you can produce some examples. But that does not mean that your line should not be drawn. It should be drawn, and I think that where the line has been drawn at the moment is, on the whole, a reasonable and rational point. I would point out to the noble Baroness that, as I understand it, tractors do receive an investment grant, self-propelled combines do, and harvesting machinery does, and the line has been drawn between static machinery and mobile machinery—mobile under its own power. That is as logical and as easily administered a distinction as one can get.

The noble Earl, Lord Ferrers, made great play with the difficulties of these grants that they were too complicated and we ought to make them simpler. This is an example of what happens when we make them simple. We say that self-propelled and mobile vehicles get the grant. Then we get noble Lords and farmers saying, "This is ridiculous. Look at what happens." But if one answered all these points there would be far more complications in administering the grants, far more form-filling, far more inspectors, and all the things which the noble Earl wants to do away with.

EARL FERRERS

My Lords, with the greatest respect, if the noble Lord's Government had kept the position as it was, where one obtained all these things by virtue of the investment allowances as opposed to going into investment grants, there would not be all the problems which the noble Lord is now encountering.

LORD WALSTON

My Lords, we should not have those problems, but we should have others. Then, of course, we always get complaints from farmers who, for one reason or another, pay no tax or very little tax and who say, "We are getting no advantage from these investment allowances, and all the big boys who are making the big profits are the ones who get them." We have been attacked to a certain extent to-day, but more often in the past, for helping the big boys more than the little boys, and this is one way of helping the little boys. One cannot have it every way. In the matter of the selective employment tax—

VISCOUNT STONEHAVEN

My Lords, before the noble Lord moves on, may I remind him that I asked whether he would interpret paragraph 17 of Schedule 4, which says: Any operation incidental to any of the operations specified in the other paragraphs of this Schedule or necessary or proper in carrying it out or securing the full benefit thereof. Can you get the full benefit of a crop drier without a fan?

LORD WALSTON

No, my Lords, you cannot. But, frankly, without being in any way offensive to the noble Viscount, I think that this is rather a specific matter. I should be very happy to write to him about it without trying to explain, in any more detail than I have attempted to do already, all the reasons why the line has been drawn in this particular place and has gone through the middle of his fan.

If I may now go on to the selective employment tax, I am glad to be able to tell the noble Baroness that repayments are already being made. I understand that something like £4 million has already been repaid, and I am very glad to say that I am one of the recipients. I hope that before long it will extend its way up into the North and that the noble Baroness herself will also be a recipient. While I am on the subject, may I say how very pleased I was to hear her kind words, speaking as a prominent representative of the consumer, and also those of the noble Lord, Lord Baler no, on the new regulations embodied in this Bill, which will go some way, if not far enough to satisfy my noble friend Lady Burton of Coventry to improve the situation of the consumer as regards marketing?

The noble Lord, Lord Inglewood, is not here, but even if he were I do not think he would be surprised if I did not comment on his questions about farm income. I do not think that they are strictly relevant to this Bill, though they are, of course, extremely relevant to the Price Review which I hope your Lordships will have the opportunity of debating before very long. Somewhere, I have notes on what other noble Lords have said, but I seem to have mislaid them. So I hope that if I have left out any serious points I shall be taken up before I sit down on this; or, alternatively, that noble Lords will write to me, when I will do my best to answer any questions.

In conclusion, I should like to say what those of us who have remained until this late hour all know so well, that agriculture is a great industry, and it is not only great in size but great in achievement. At least since 1939, its record is indeed a very proud one, and I think we can say without any fear of contradiction that if all the other industries in this country had equalled agriculture in its achievements, in its increased output, in its stabilisation of prices and in its increased efficiency, our economic life would be much easier than it is at the present time. I, for one, am proud to be a member of the agricultural community. There are very few countries in the world which can vie with us in yield per acre, in yield per animal or in output per man, and very few indeed which can vie with us in our record of holding prices in check.

The result of this achievement has led not only to import saving, to which noble Lords have already referred—and very substantial and important import saving—but also to exports; very substantial exports indeed, amounting to something in the neighbourhood of £100 million in the last year. That is quite an achievement for an industry which used to be regarded as being the poor relation of the other, more modern, technologically minded industries. But it is not only agriculture which has benefited from this, or this country which has benefited: the industries ancillary to agriculture also have benefited. We have made enormous advances, for instance, in plant breeding, which have benefits throughout the whole world. From our fertiliser factories there have been very substantial exports, based on our home agriculture. There have been advances in herbicides and pesticides; and, of course, in the agricultural machinery industry itself. Because of the firm home base, we are now exporting agricultural machinery, and in 1966 the value amounted to over £140 million.

My Lords, all these are things which people should know about more. People engaged in agriculture should know about them, and be proud of them; people who are not engaged in agriculture should know about them, and be grateful for them. They have been achieved for a variety of reasons. They have been achieved because we have good farmers and farm workers. That is at the core of it all. They have been achieved because we have first-class scientists and engineers; and they have been achieved also because, over the years, we have had Governments—and this includes both Parties—which have instituted and created the right framework in which this agriculture could develop. Included in Government are the National Agricultural Advisory Service officials, the civil servants, and the politicians, too. I believe that this Bill is one more example of the type of Government action which helps agriculture along the path of further advance, and I am confident that in the years ahead the industry will find that what is being legislated for to-day will help it to continue with the advance that it has already made.

LORD LOVAT

My Lords, the noble Lord was kind enough to say that he would, allow a question by anyone who had been left out. I raised the problem of the Highlands, which are a very large land mass where more can be done than in any other part of the United Kingdom if we get our chance. I do not know whether the noble Lord is leaving the answer to that point to the Secretary of State for Scotland, but I would remind him of what I have said already. We sell for less, and we have to pay a great deal more for what we buy. This is a perfectly intolerable state of affairs, bearing in mind the distance from any market.

LORD WALSTON

My Lords, I accept what the noble Lord has just said. The Highlands are a problem on their own. There are—and there is no need for me to recount them, because the noble Lord knows them well—a whole series of items of special legislation which have been enacted in order to help with these problems; not to solve them, but to help with them. I think that some of the provisions of the Bill will help, although, of course, they are not directed specifically towards the Highlands. We have the curious arrangement here, as the noble Lord knows well, of the Ministry of Agriculture in England and, North of the Border, the Secretary of State for Scotland. I know well that both of them are fully aware of these problems, and are thinking of them the whole time. I can- not give the noble Lord any more specific answer, but would refer him once more to those items in this Bill, particularly those to do with livestock, and to some of the livestock subsidies, which I believe will be of some help, particularly to his own area.

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

House adjourned at a quarter before nine o'clock.