§ 6.53 p.m.
My Lords, I beg to move that the Farm Capital Grant (Variation) Scheme 1972, which was laid before this House on March 16, be approved. The Scheme covers England, Wales and Northern Ireland, and it may be convenient to your Lordships if my remarks are also addressed to the Farm Capital (Variation) (Scotland) Scheme 1972, since its content is similar.
359 These Schemes give effect to the changes in the arrangements for the farm capital grants which were announced with the results of the 1972 Annual Review at the beginning of March. The Schemes continue the higher rates for field drainage which, like the rates for other works and facilities, were to have been reduced by 10 percentage points for application after March 18, 1972. They also provide for the termination of the grants for certain minor items unless approval was applied for by March 31.
As your Lordships will recall, the grant rates were increased by the last Government as a temporary measure for two years from March, 1970. Their action was taken at a time when capital investment was lagging, partly because of credit difficulties, and also because farmers were finding it increasingly hard to finance investment out of income. To-day the industry is in a more favourable situation: incomes are higher, credit is cheaper and easier and taxation less onerous. There is now greater confidence among farmers, and the temporary need for higher rates of grant for all items has therefore passed.
But, my Lords, there is still a need to give special encouragement to field drainage, which is of fundamental importance both for expanding production and for maintaining the fertility and structure of our soil. Of all the possibilities of increasing the productivity from the actual land itself, proper and efficient—and improved—drainage stands out as being the one thing that, when every other factor is constant, will result in improved output, and there are many farms, and very many acres, whose output is being directly and specifically curtailed by lack of adequate and effective drainage. But drainage—and I mean proper and complete drainage—is of course expensive. I pay tribute to the Party of noble Lord opposite, who when they were in Government increased the drainage grant from 50 per cent. to 60 per cent. I believed then—and I believe now—that this was the right move, because there-after the farmer did not have just an equal stake with the Government in drainage, but he had a definite and direct incentive to undertake the heavy capital expenditure which drainage necessitates. In England and Wales alone it is esti 360 mated that there are still about 7 million acres of land which could benefit from under-drainage.
Over the past ten years the annual acreage under-drained in England and Wales as a result of grant-aided schemes has roughly doubled. The acreage under-drained during 1970–71 had reached nearly 200,000 acres, at a cost of £6.3 million. Comparable figures for the following year, 1971–72, are 233,000 acres, at a cost of £7.4 million. But we need to maintain this impetus. If the higher rates of grant were not continued it might well become more difficult to convince farmers, and particularly those in the traditional grassland areas, that drainage deserves a very high priority in any plans for investment, both in order to facilitate an extension of arable crops and in order to enable the grass itself to be fully exploited. These Variation Schemes therefore amend the principal Schemes in order to continue the present enhanced rates for field drainage. These will remain at 60 per cent. for field drainage work and 70 per cent. if the work is for the benefit of hill land. So far as the Exchequer is concerned, the continuance of the higher rates on field drainage in the United Kingdom is estimated to increase the annual cost of the grant by about £2 million.
It will, I think, be generally accepted that field drainage deserves this high priority in its present condition. But farming conditions have changed since grants for farm improvements were originally introduced, and we have therefore considered whether expenditure of public money is still called for on various relatively minor items. My right honourable friend concluded that grant was no longer justified in certain cases. The Scheme therefore specifies seven items for which grant has been ended in so far as lowland farms are concerned. These items are sheep and cattle grids; fencing; shelter belts; hedge removal; land clearance and reclamation (but excluding orchard grubbing); ploughing, destruction of cover for rabbits and claying and marling. To qualify for grants on these items applications for approval must have been made on or before March 31. However, before applications ceased to be accepted a period of notice was given, to allow farmers who already had plans in hand 361 to get in their applications. Farmers throughout the country made very good use of this opportunity. The annual savings from the ending of the grant on these minor items will come to less than the figure of some £2 million, which will be required for the continuance of the higher drainage grant.
My Lords, I said that the grant on these items will no longer be available to lowland farms. Nevertheless, we intend that hill farmers shall still be able to get a 50 per cent. grant for the works that concern them, just as would have been the case if the separate items had not been terminated. The Variation Schemes therefore extend the list of works and facilities covered by the special hill item, which is Item 13 of Schedule 2 to the main Schemes. Although the ploughing grants are not specifically mentioned as being continued for the hills, I would point out that ploughing work of a capital nature will continue to qualify in the hills as "regeneration of grassland" or "reclamation of land", which are already mentioned in the hill item.
I should like to refer briefly to the technical amendment contained in paragraph (2)(a) of the Variation Scheme for England, Wales and Northern Ireland. Its purpose is simply to correct a minor printing error in paragraph (3)(1)(a) of the principal Scheme. These Schemes are designed to secure the right priorities in the expenditure under the farm capital grants so that assistance is concentrated where it is most needed. The capital grants are of course only one aspect of the support arrangements for agriculture, but in conjunction with the Annual Review Award and the steps being taken to strengthen the market for farm produce. I believe they will help our farmers and landowners to achieve an expansion of production and an improvement in their returns. My Lords, I beg to move.
§ Moved, That the Farm Capital Grant (Variation) Scheme, 1972 be approved.—(The Earl Ferrers)
§ 7.3 p.m.
§ LORD HUGHES
My Lords, I wish to thank the noble Earl, Lord Ferrers, for the very detailed statement which he made—so detailed in part, I am afraid, that I shall have to be content to wait until I read it to-morrow in order that 362 it may sink in—but I am sure that those of your Lordships who are more directly concerned with farming than I am will appreciate the value of some of these statistics quoted by the noble Earl.
Towards the end of his remarks he used words, which are now becoming familiar from this Government, about "concentrating the aid where it is most needed". These words have perhaps a less happy connotation when they are directed to rents of houses than in other directions. It is not for me to quarrel with anything that the Government may do when they decide that certain grants which have hitherto been paid to farmers are not now needed and propose to withdraw them, though it is a certain satisfaction to me to know that they continue for hill land, which has perhaps a proportionately greater importance in Scotland than South of the Border. I found myself very substantially in agreement with the noble Earl's references to grants for drainage. He indicated that the arrangements made under the last Government, by which these grants would be available for two years until 1972, are now being continued. I am not certain whether the noble Lord meant that these grants are to be continued indefinitely or for a further limited period. Perhaps he can clarify that for me.
The only other thing I wish to say concerns items which are now being dropped in paragraph (2)(b)(i) and which are being added by paragraph (2)(c) to paragraph 13 of Schedule 2 so that they may continue to apply to hill land. I am a little mystified by some of the wording. When one reads that the grant will be continued for items likethe removal of hedges, tree roots, boulders or other like obstructions …what other obstruction can be like a boulder or a tree root? I presume in fact that the "other obstructions" may be the alternatives not merely to boulders but to the various things which come before them. I have become very much infected with the views of the noble Lord, Lord Conesford, who does not like to see strange or unnecessary words in legislation. Quite frankly, I wonder what useful purpose is served by including the word "like" here. Presumably what is meant is that any obstruction which is likely to interfere with work which 363 would otherwise be done is to be provided for—or are we to understand that unless something can establish some kind of identity or similarity with a tree root or boulder it is an obstruction which the farmer must put up with and that he will not get any grant for its removal? I hope that the noble Earl can answer the first and more serious point and let me know what "a like obstruction" is. I should like to say to the noble Lord, Lord Polwarth that I do not intend to repeat any of these remarks on the Scottish Scheme, which I am prepared to accept follows the English one.
My Lords, as a practical farmer I welcome the Farm Capital Grant (Variation) Scheme, which contains a very good point about land drainage. I am certain that if more farmers took advantage of this, production would go up. There is one thing that I should like to mention, and it concerns grants for shelter belts. I do not think it is sufficiently realised what benefits a shelter belt confers in the production of either grass or corn crops. A reduction of the wind raises the temperature of the soil and makes things grow. There is one other thing: I would ask the noble Earl whether these grants come off the money we shall have to pay to the EEC when we join.
§ LORD BALERNO
My Lords, I welcome this increase in the drainage grant, but I would particularly like to speak to the point raised by the noble Lord, Lord Hughes, of "other like obstructions". Other like stone obstructions which occur to me are ruins of old farm cottages or farm buildings which can sometimes be found, especially after farms have been merged with others. Also, I have sometimes had experience of the remains of military erections from the last war which have not been completely removed. I would suggest to the noble Earl that these are all things that might come under the definition of "other like obstructions".
My Lords, I am very grateful to your Lordships for giving such approval to these Schemes. I am bound to say that I was fascinated by one remark of the noble Lord, Lord Hughes, which I shall certainly remember, when he said, "It is not for me to quarrel with the Government when they have decided what to do". I am delighted to know that, and I hope we shall see the noble Lord's compliance with what the Government do in future.
§ LORD HUGHES
Either I did not complete the sentence or the noble Lord did not listen to the end of it. I said: "when they decide to take money away from the farmers".
That certainly puts a slightly different complexion on the matter. The noble Lord asked whether the Government were continuing the drainage grant for just a two-year period or for longer. The two-year period was the period which the noble Lord's Party, when in Government, accepted. We have been rather more generous and have decided to make it a part of the Scheme. Therefore, it will not continue for just a two-year period but will continue, relatively speaking, as long as the Scheme lasts, or until it is altered.
My noble friend Lord Balerno explained what he thought was the answer to the noble Lord's query with regard to theremoval of hedges, tree roots, boulders or other like obstructions.The noble Lord asked what was an "other like obstruction". Rather frivously, I thought that the answer was a Member of the Opposition Front Bench. But on more serious consideration I felt that my noble friend had hit the nail on the head when he said that when you are levelling land for cultivation you are likely to come up against some curious obstructions; for instance, where airfields were constructed during the war. There are many curious underground obstructions which may come to light and which clearly have to be removed. Where this is the case this will be covered under the Scheme.
The noble Lord, Lord Nunburnholme, referred to the shelter belts. I agree with him that shelter belts and the making of them is something which is desirable, 365 both from the point of view of amenity and agricultural land. However, the fact is that the grant which has been payable in the past has been so small, and people have applied the grant to such a small extent, that it has been decided that this would not be a sensible means of using public money in the future as the sum concerned amounted to only about £9,000.
My Lords, the grant was small. May I ask on what grounds it was decided that it should not be continued?
My Lords, the basis on which my right honourable friend worked is that if money is going to be spent it should be spent in the way most likely to produce the best results. As this was a Scheme which was very little used, it was decided that it should not be continued. That does not mean to say that the farmers should not be encouraged to plant their own shelter belts, because this would be something which would be very beneficial.
The noble Lord also referred to the European Economic Community. I am pleased to tell him that to a certain extent we shall be able to use this particular assistance for capital investment which we have been discussing when we accede to the European Community. The agreements which were reached in Brussels shortly before Easter on the directives for structural reform provide sufficient flexibility to enable us, once we are members of the Community, to continue the system broadly as at present using methods which are appropriate to our own circumstances.
The noble Lord, Lord Wise, asked whether this referred to rabbit scrub clearance. Rabbit scrub clearance is not going to be included in future in the Farm Capital Grant Scheme.
§ LORD HUGHES
My Lords, before the noble Earl finally resumes his seat may I point out that with the aid of his noble friend Lord Balerno, he has only answered part of my question? I am willing to accept that a ruined building or an old wartime erection might be a suitable obstruction to be removed with the aid of this grant. I cannot accept that it would necessarily fall into the category of being a "like obstruction". 366 I can see no resemblance between a ruined cottage and either a boulder or a tree root. But perhaps to the ministerial or civil servant mind they just look like two sides of the same coin. On a more serious note, I asked why the word "like" was put in because I can only see that it has some significance if one has in mind that there can be other kinds of obstruction which will not rank for grant. Is it intended that there could be an obstruction that a farmer might come across on his land and someone in the Ministry of Agriculture or the Scottish Office could say, "This is not one of the obstructions referred to and it is not a 'like obstruction '"? Can the Minister give me any indication as to what possible kind of obstruction would be excluded?
My Lords, as the noble Lord has come on to a very technical, precise point, as to what a "like" object is, I should prefer to consider it a little. He asks me off-the-cuff what is to be excluded. I should have thought that a "like" object to a boulder might well be a lump of concrete. There is certainly a similarity there. If the noble Lord is asking me to categorise those objects which are not "like" objects and which will be excluded I will certainly consider this and write to him.
§ LORD HUGHES
My Lords, I must accept that. I was hoping that among the frequent notes that the noble Lord, Lord Polwarth, was passing over to the noble Earl one was the answer to my question.
My Lords, while some of the notes may have been the answer to the noble Lord's question, I am afraid that I have not read them.
§ LORD BALERNO
My Lords, might I suggest that an electric pylon is an obstruction but not a "like obstruction"?