FARM CAPITAL GRANT (VARIATION) SCHEME 1971 (Hansard, 3 August 1971)

EARL FERRERS
My Lords, I beg to move that the Farm Capital Grant (Variation) Scheme 1971, which was laid before the House on July 8, be approved; and perhaps it may be for the convenience of your Lordships' House if, at the same time, we discuss the Farm Capital Grant (Variation) (Scotland) Scheme 1971, which is the subject of the next Motion.
My Lords, if I may, I will deal' at the outset with a minor drafting point which these two Statutory Instruments seek to clarify in relation to paragraph 5(1) of the principal Farm Capital Grant Schemes, which are now the unified Schemes for grant aid. This is to be found in paragraph 2(a) of the Variation Schemes, and makes it clear that applications made under the principal Schemes before the closing date qualify only for consideration for grant, and would not qualify automatically for grant solely by virtue of being made before the closing date.
The main purpose of the Variation Schemes is to provide a special rate of grant to growers as an incentive to grub up unwanted apple and pear orchards of dessert and culinary varieties. The apple and pear industry to-day contains many growers who have equipped and improved their businesses, at no small cost to themselves, to a high level of competitive efficiency. The industry has done a great deal to help itself by introducing better methods of husbandry, better methods of storage and better methods of grading their produce. The Apple and Pear Development Council, while devoting itself primarily to the promotion of home-grown fruit, has also carried out research and other tasks important to the organisation and development of a competitive and effective industry. But, my Lords, these efforts by growers are being undermined by the haphazard marketing of mediocre fruit from orchards which are commercially barely viable or from pockets of old orchard land on farms which receive little care and attention. Such orchards are a burden on the rest of the industry. Their fruit reaches the market during the autumn and early winter, when supplies from the regular commercial growers are most 1088 freely available; and since the growers concerned have little or no interest in the long-term commercial future of apple production, they are often adequately satisfied to take whatever short-term return they can get. This, of course, can be highly disruptive of the market, and can have a serious effect for the regular supplier, on whom we must in the end depend for our supplies of good quality, home-grown fruit.
The new grant is intended to remove this source of weakness by encouraging the owners of these barely viable orchards to get rid of them once and for all. The grant will be at the full rate of standard grubbing costs, as fixed by Ministers. The standard costs run from 13p to £1.82 per tree, according to the tree's girth, and they are based on direct labour costs. The grant will become payable, if your Lordships approve these Orders, from September 1, and applications may be made up to March 31, 1973. Its life will therefore be quite short, for the aim is to encourage something of a crash programme of grubbing. It is no part of the purpose of these Schemes for orchards which are grubbed up with their assistance to be replanted with new apple and pear trees. The grant will therefore be subject to a no-replanting condition which will run for five years from the completion of grubbing. I would stress that this is a major difference from the old and lower grants for orchard grubbing, which will still continue to be available. Indeed, the present grubbing grant will continue to run concurrently with the new grant. Fruit growers who want to grub up trees in order to renovate their orchards as a matter of good husbandry will still, therefore, be able to apply for grant under the existing Schemes. There have been full consultations with the farmers' unions over the new Schemes, and they have been welcomed by the horticultural industry. I hope that the need for them cannot be doubted, and I invite your Lordships to approve these two Statutory Instruments. I beg to move the first Order.

§ LORD HOY
My Lords, we are grateful to the noble Earl, Lord Ferrers, for 1089 explaining these Orders. There are only one or two points I wish to put to him. First of all, I should like to associate myself with the tribute, if such it was—and I think he meant it as such—to the Apple and Pear Development Council, because I think that this Council, under the chairmanship of Sir Richard Boughey, has really done a first-class job at minimum cost for the apple and pear industry, and I am grateful to have the opportunity once more, and for the first time in your Lordships' House, to put my personal appreciation on record. We are grateful to the noble Earl for the clarification he gave when introducing this Order, because without it I think it might quite well have been misunderstood. I can only hope that the Order in fact carries out what the noble Earl has told the House, and that we shall not get into further trouble over some interpretation.
As I understand it, what is being done is to provide an Order which will enable the grubbing of trees to be carried out once and for all; so that it is entirely different, really, from the present Order, with which it will run concurrently. The present Order, of course, provides grants of something between 33⅓ per cent. and 40 per cent., but this is for people who really are in business, to encourage them to take out trees which have become less productive and to replace them. This Order will apply only to those who, I understand, will remove the trees once and for all; and for that reason I found it just a little difficult to understand the last two words of the Explanatory Note, which says that this is subject to a specified condition"restricting planting ". I take it from what the noble Earl has said to your Lordships this afternoon that"restricting planting"is equivalent to the prohibition of planting; but it seemed to me to be a peculiar phrase to use in the Order. As I see it, however, and as I gather from what the noble Earl has had to say, what this will do will be to remove what on the whole are regarded as uneconomic orchards—that is, those of a smaller type—and take them out of production altogether.
As a result of this, I do not think it will have any great appeal to the larger grower, who will in fact be prepared to carry on under the Orders at present in operation. But inasmuch as it appeals to those people who produce uneconomically 1090 and bring their produce on to the market at particular times, which frequently causes disruption and which indeed makes it non-profitable for those who really are engaged in the industry not only to provide food but to earn their livelihood, and inasmuch as it goes any way to meet that difficulty, then we welcome it. I thought we might have had one word of explanation as to why cider apples and other things did not qualify for this particular grant. Obviously, there must be a good reason for it, and perhaps when the noble Earl comes to say just a word or two in reply he will be able to tell us. We will then all understand completely what the Order is about.

EARL FERRERS
I am grateful to the noble Lord, Lord Hoy, for the welcome he has given these Orders. I should like to clarify the point about which he seemed to be in doubt. The purpose of the original scheme, which is going to run concurrently, is to encourage existing commercial apple growers to grub up old orchards which are no longer particularly fruitful and to replace them with new. But there are a number of growers who have had their orchards going for some years, sometimes for as much as forty years, who do not bother to take much care of them and who at harvest time collect apples and dump them on the market. This"mucks up"the whole market organisation—usually at a time of glut. Therefore the object of this Order is to encourage these people by means of a grant higher than the existing grant to remove their apple trees once and for all.
The noble Lord was right to interpret the last two words of the Explanatory Memorandum as restricting replanting operations. That is so. It is the principle of the Government to prevent people who do apply for such grants from replanting the same area of land within five years. Of course, should a person accept the grant, grub up his orchards and later sell his land to somebody who may wish to go into apple growing, this will not restrict the new owner from so doing. The whole purpose of the Order is to exclude the possibility of persons getting a larger grubbing-up grant and then re-planting their orchards. The 1091 noble Lord asked why cider apples were not included in this scheme. The reason is a simple one: that those who grow cider apples usually do so on contract, with a firm base for their outlet. It is not considered that those people are usually the cause of market disruption. I hope that with that explanation the noble Lord will be happy.

§ LORD BESWICK
My Lords, may I ask one question? Is it estimated, calculated or considered that the disruption of the market caused by these people with inferior orchards will be greater than the disruption to the market, when we are in the Common Market, caused by supplies from Europe.

EARL FERRERS
The noble Lord has put forward a crafty point, but I think that even he would agree that if these apples were on the market at the same time, even if we were in the Common Market, it would lead to greater disruption than was in the mind of the noble Lord when he asked the question.