§ 2.53 p.m.
§ LORD MAELOR rose to call attention to the plight of hill farmers and to ask Her Majesty's Government what steps they propose to take, both at home and in the Common Market, to relieve the situation; and to move for Papers. The noble Lord said: My Lords, as stated on the Order Paper, I wish to call attention to the plight of hill farmers and to ask Her Majesty's Government what steps they propose to take, both here at home and also in the Common Market, to relieve the situation. As is generally my custom when speaking in your Lordships' House I shall speak mainly as a Welshman and this afternoon I have the Welsh hill farmers in mind. But what I shall say applies also to all the hill farms of Britain. In Wales we are confronted by the problem of the constant depopulation of the uplands. The reason why depopulation has become so rampant is the simple fact that the farmers on the hills cannot make a living and are seeking employment elsewhere. The question to be answered is whether the hill farmers can possibly secure a decent living and abide on their farms. Can productivity somehow be increased on these hills? The answer has been, "No" for the simple reason, as it was argued, that the climate of the hills was responsible for low production. And as no one knows how to change the climate, what can be done to change hill farming?
§ This seems to explain the pragmatic approach that has pervaded all policy pursued by successive Governments, Labour as well as Conservative, in respect of hill farming. With the depopulation of the hills and the lowering of the purchasing power of those left, an economic blight has seeped into the villages and the market towns of Wales. Services in the countryside have fallen away and local industries have completely collapsed. The population of the hills is an ageing one, for the simple reason that the children have to leave in order to look for better prospects. The schools have 956 emptied and they are being closed. We should ask ourselves whether it is by chance or by casual relationship that all the depressed areas of the country, especially the depressed industrial areas, have as their hinterland a vast area of debilitated hill land gripped by proverty. We know from hindsight that Carthage collapsed when farming failed in the area, and before pouring millions of pounds into the depressed industrial areas of the country should we not find out how much the failure of farming in the region has contributed to the situation?
We know that poverty produces poverty. Can we afford to treat with equanimity the contagion that is poverty in our hills? What is the real origin of the poverty of the hills? Climate as the culprit was put there on a purely subjective assessment, and we know how wrong subjective assessments can be. So it has proved in this case. In 1964, the Welsh Plant Breeding Station set up an experimental farm in the hills of Radnorshire. Three years later, in 1967, it issued this statement:
Contrary to the general belief it is not climate that is responsible for low production in the hills but soil poverty.
If we take the growth of good grass in good soil at sea level as 100, the same grass in the same soil at 1,000 feet elevation will yield 66. The climate of the hills reduces the growth of grasses by 33 per cent. If, however, we measure the growth of the grasses in hill soil at 1,000 feet elevation the production is only 5 to 10. The poor hill soil and the poor hill grasses reduce production from 66 to 10 or even to 5. It is the poverty of the soil that is basic to the whole problem of hill farming. This fact was stated by the late Lord John Boyd-Orr in his book, Minerals in Pastures, published in 1929. It has taken us nearly fifty years to rediscover the truth.
§ The hill soils of Wales are among the poorest in Britain. They were formed largely from the underlying slate rocks. These slate rocks are themselves deficient in minerals needed by plants and by animals. Adding to this deficiency is the fact that the minerals have been washed out of the soil by high rainfall since those soils were formed. The worst hill soils are now so depleted that only plants which are specially adapted to poverty soils can grow there. The yield of such plants is scant. The quality is poor, and 957 many are so unpalatable that animals will eat them only when there is nothing else. Growth is slow in spring and the quality deteriorates very rapidly in autumn, so that only a short grazing season at the height of the summer is available. The long-term effect of these poverty soils on the grazing animal is clear. The horses have become ponies, as exemplified by the Welsh ponies, the Shetland ponies and the Dartmoor ponies. I do not think God ever created ponies; they have deteriorated from horses as a result of the problem I have mentioned. The hill breeds of sheep are only half the size of lowland breeds. Hill cattle are always stunted. The Aberdeen Angus is losing favour as a beef animal because it is dwindling in size. This has happened to such an extent that some of the original stock exported to Canada are now being reintroduced into Scotland to improve the size.
§ The present-day effect of these poverty plants growing on poverty soil on the economy of animal production in the hills is just as striking. Under the worst conditions only half the ewes can produce lambs. What sort of economy can we expect when two ewes have to be kept in order to produce one lamb? It is laughable to find that official publications of the Ministry of Agriculture warn hill farmers against feeding their ewes too well immediately before tupping because they might in consequence produce two lambs, and two lambs are too many in the hills. The two could finish the year only two-thirds grown and therefore be unmarketable.
§ After listening to these facts, you may well wonder why there is a single farmer left in the hills. Even under the appalling economic conditions, the area is so vast that 500,000 head of cattle are produced each year and a third of all the lamb and wool production in Britain comes from the hills. This sort of production is of such importance to our food needs that we cannot afford to be without it. Successive Governments, by introducing various forms of special hill farming subsidies, have succeeded in keeping the farmers going. Without the subsidies, hill farming would have totally collapsed long ago. But these subsidies are not a total blessing; they tend to encourage over-stocking, which results in 958 lowered production due to the deterioration of the vegetation.
§ This brings me to the main point of my argument. While it was generally believed that climate was responsible fox low production in the hills, it was difficult to conceive of any pragmatic approach, other than subsidies, to keep farming going in the hills. Now we have been told by the scientists that climate plays only a minor role in hill farming, a rational rather than pragmatic approach is possible. Soil poverty is the major issue. We cannot change the climate—thank God for that!—but we can cure the poverty of the soil. It needs three tons of lime and one ton of basic slag to correct the deficiency of most hill soils over a given area. The grazing ratio can then be hoisted from the low level of 5 to 10 to as much as 66. A five-fold increase is generally possible in the grazing available for animals on hill farms.
§ There is a complication inasmuch as the natural vegetation, as adapted to poverty soil, does not respond to the added minerals. To cash in on the added minerals, grasses and clovers akin to those grown in the Lowlands have to be introduced in the hills. The combined effect of adding minerals and introducing suitable grasses and clovers is to transform the whole scene. The cost of adding the minerals needed and of introducing suitable grasses and clovers is assessed to-day at £25 per acre. This outstanding fact should interest the Government. The additional production resulting would recoup the capital cost improvement in three years. It would take only three years for the Government to get their money back. The rate of stocking can be pushed from one ewe per 1½ acres to 4 ewes per acre. The ewes respond by producing more lambs. Instead of 10 ewes producing 5 to 7 lambs, they could then produce 11 lambs. The grazing would be so plentiful and palatable and of such good quality that larger lambs could be produced by crossing the hill breeds with Lowland breeds to give ten-fold increase in weight of lamb.
§ I have to ask myself why this revolutionary possibility of transforming the hills has not been shouted to the four corners of the world. That it is practical has been proved by the Ministry's experi- 959 mental farm in Cardiganshire. At Pwllpeiran farm the improvement has been found possible at 2,000 ft.—and this is 500 ft. higher than has been thought possible up to now. This fact alone adds millions of acres to the area that can be improved in Britain. Anyone with interest in hill farming should visit the research farm at Pantydwr in Radnorshire and also the experimental farm at Pwllpeiran in Cardiganshire. If they go by helicopter they will need no directions. The two farms are like two oases in a desert. If, in flying over the hills of Wales, you spot a tiny area of verdure, you can be sure that a hill farmer with a little cash to spare—a rare phenomenon—has tried out the system of improvement on part of his farm. The system of improvement has passed every test with flying colours and it is now ripe for general application throughout the hill areas of Britain.
What prevents this green revolution from being carried out? The answer is simple, and in the economic interest of the nation the remedy should be put in hand at once by the Government. At the moment, the Government are offering one-half of the cost of improvement. The tragedy is that the hill farmers cannot take advantage of this offer simply because they are too poor to provide the other half from their own resources. It is no use offering half the grant if the farmer is unable to meet the other half. The other day I saw a man buying a ticket at the railway station. The ticket cost £1 and he had only 50p in his pocket. What a gloomy and helpless look was on his face! Then a friend offered him a 50p piece to make up the full amount. What a changed face he had then! That is exactly the position with hill farming. The hill farmer should, and must, have a 100 per cent. grant. Such a grant would automatically bring to a halt the depopulation of the hill areas. Capital will have to be given to achieve the green revolution that I am talking about. The other day in the Guardian, which I have here, there appeared a letter from a widow, a hill farmer. I will quote one paragraph from what she wrote:
We must choose between growing two blades of grass where one grew before or being hungry. The hill farmer is a dying race and he will have few successors.
That is the view of an experienced hill farmer.
§ I was encouraged by the Statement which the Minister of Agriculture made in another place and which was repeated in this House on November 22, which warranted that the Common Market will make a grant of 25 per cent. towards the cost of aid for improvements under the development plans. The remaining cost will be borne by each individual Member State. With this aid from the Common Market fund the Government should now be encouraged to give the whole 100 per cent. grant that I have asked for.
In conclusion, I would say that as a good Welshman I read my Bible. When reading the 72nd Psalm the other day I came across this verse. This is what David says:
There shall be an handful of corn in the earth upon the top of the mountains; the fruit thereof shall shake like Lebanon:
In other words, King David, thousands of years ago believed in the green revolution of which I am speaking this afternoon. I am not so modern as I thought I was. My Lords, I beg to move for Papers.
§ 3.12 p.m.
§ BARONESS ELLIOT OF HARWOOD
My Lords, we are all indebted to the noble Lord, Lord Maelor, for introducing the subject of hill farming. I take part in the debate because I am an active hill farmer, not in Wales, about which the noble Lord has spoken, but in Scotland, and if I speak this afternoon to your Lordships about hill farming, it is from a very long experience of hill farming in Scotland. I may say that I do not follow exactly in the footsteps of the noble Lord, Lord Maelor, because my experience, which dates from 1934—that is some 40 years ago—is rather different, or at least my views to-day are rather different from those of the noble Lord, Lord Maelor.
I have lived as a farmer through a long period of farming when prices have been up, although when I started off in 1934 prices were very low indeed, far lower than they are to-day; and wages, of course, were what we should call infinitesimal. I have lived through periods of fluctuation, when prices have been high and then low, and then high I and then low; and to-day they are all 961 rising again. One has to view the activities of hill farming on a fairly long basis over a number of years. It is no good looking at it for a short period because it takes a long time for many of the experiences and the work to have any effect. I do not agree with the noble Lord, Lord Maelor—at least it does not happen in Scotland—that we are now in a very poor situation as hill farmers, that people are leaving the land, and that hill farmers are a dying race. My Lords, I can tell you quite a different story.
Hill farming to-day, in Scotland anyway—and I think also in the North of England since I know a little about what happens in Northumberland and Cumberland—is at this moment having a very considerable recovery. It must have a very considerable recovery because between 1958 and 1967 we were really in the doldrums; the prices and the effects of the poor returns on sheep farming and cattle farming in the hills were very bad and disastrous from the point of view of the farmer. But to-day the situation is different and I am glad to say that it is different. I would say that the difference comes about not entirely from the policy of Her Majesty's Government to-day but also because when the Labour Party were in power, and particularly when the late Tom Williams was Minister of Agriculture, a great deal was done to help farmers, and hill farming in particular. What I say to-day is not something which applies only to what is taking place under the present Government: there were times when the Labour Government, under the late Tom Williams as Minister of Agriculture, did a tremendous amount for agriculture. So my speech to-day is not entirely a Party speech. It is as a farmer, as a hill farmer of some 40 years' standing, that I address your Lordships.
First, I should like to say that this Report, Hills and Uplands (I do not know how many of your Lordships have seen it), is a Report by the Economic Development Committee for Agriculture on United Kingdom Farming and the Common Market. It has some extremely interesting figures and reflections on policy which I would recommend to all your Lordships who are interested in farming. The importance of hill farming may be appreciated from the fact that in the United Kingdom alone 14 million acres are covered by hill farming and upland 962 farming. There are 26,000 farms in the United Kingdom, and one-seventh of those are hill farms and rank for the hill farming grants and hill farming subsidies. Fifty per cent. of the sheep and wool output in this country comes from the hill farms, and 20 to 25 per cent. of the cattle output comes from upland and hill farming. Those are very important figures, my Lords, particularly to-day when we are so anxious to increase the amount of meat, lamb and mutton that is provided for the consumer in the United Kingdom.
The main output of the hill farms is store sheep and store cattle, and these, as many of your Lordships will know, are sold to farmers in the lowland areas for fattening. That brings vital supplies to the agricultural land, the land that grows barley, wheat and crops of all kinds, and on the aftermath of those crops they can feed the store sheep and store cattle. This combination of hill farming and lowland farming, therefore, is vital to a proper economy in farming. The Government to-day are supporting all farming to the tune of about £200 million. That is in my view a handsome subsidy for the farmer. Of that sum £30 million goes to the upland and hill area farmers and enables them to continue and increase the essential production of cattle and sheep for home consumption. The subsidy represents 17 per cent. of the total United Kingdom product and in Scotland it represents 32 per cent., while in Northern Ireland 50 per cent. of the amount of subsidy goes to those areas. I should like to quote one paragraph of the Economic Development Committee's Report.The E.D.C. considers that without the current level of hill grants increase"—that is the increase of production—in recent years would not have been sufficient to maintain present production or to provide for and encourage the additional investment and increase in output that future market trends seem likely to justify.That is a great justification, in my view, for the support that is given to hill farmers.
Wool is another commodity which is important to the consumer in this country, and 10 per cent. of the income of hill farmers comes from wool. The wool is marketed through the Wool Marketing Board, a successful and important organi- 963 sation for selling wool throughout the country and the E.E.C. Rising prices of cattle and sheep have been greater than the price rise in wool but it has also risen some pence per pound to the producer in recent years. I am not speaking for Wales—Lord Maelor may well have more information than I have—but I would say that to-day the hill farmer is on rising prices and is batting on a far better wicket (if I may use another metaphor) than we have had for many a long day. It is very important that it should be so, otherwise the production, so vital to our economy, cannot increase.
There are many suggestions for improving the income of the hill farmer by developing other kinds of industry—tourism and so on. As a hill farmer, I should prefer to increase the production and income of hill farmers by agriculture rather than other means that are subsidiary to agriculture. There is of course the great development of forestry. In your Lordships' House we have debated this subject many times and it is one on which I hold slightly less enthusiastic views than many of your Lordships, since I have seen so much excellent land in the Border country go to forestry for the simple reason that in the years before 1970 hill farmers could not make hill farming pay. Prices were so low and it was impossible to get a proper return. But to-day the position is different. In those days when hill farming was so bad small farmers who could not afford losses sold their land to the Forestry Commission and to private forestry, and there are hundreds, thousands, of acres which have gone into trees and which to-day could be producing mutton and beef. I am not arguing the case between the two, because that is something which we should work out in co-operation with the Forestry Commission. But when it comes to producing edible food the fact is that you cannot cat trees, but you can eat mutton and beef; and therefore I think their production has a priority. I know that those views are not those held entirely by your Lordships, but I am not pressing my point of view to-day.
To-day we are in a different position—and I think it is a very good thing—and we should encourage hill and up- 964 land farming as much as we can. If you study, as I hope some of your Lordships will, this very interesting Report you will see that in one of the tables, Appendix C, there is a list of decreases in prices between 1964 and 1971, and that from 1971 prices started to rise. There were some extremely bad years, 1966 and 1967, when it was practically impossible to make any profit, and costs and wages continued to rise all that time. That was the reason why many hill farmers went out of business. But in 1971, my Lords, things began getting better and 1972 and 1973 have continued the upward trend. Of course costs are rising, wages are rising, but nobody grudges the agricultural worker the wage that is being offered to him to-day because no worker in the community, in my belief, is more loyal or works harder than the agricultural worker. Therefore the rises which we are offering are entirely justified; and, speaking as a farmer, I am delighted to pay them. The difficulty arose earlier when farmers were asked to pay rises when they were getting very much less money for the product. On one occasion, I was selling draught ewes in the market in Hawick for the same price as I had sold them in 1937. That is a long time ago, and the wages were six, eight or ten times as great. It is impossible to make things pay in those circumstances. But to-day that is not the case at all.
But there is one vital point which I hope the Government will realise in this matter—and I am making this somewhat optimistic speech on hill farming at the moment because I believe it to be the truth that to-day we are very much better off than we have been since 1967. But we must continue with the same treatment in the line of subsidies as we have had to date, and we must get from the Common Market the kind of regional policy which the Government are fighting so gallantly to get for us.
I could not agree with the noble Lord, Lord Maelor, that we ought to be given 100 per cent. subsidies. I do not think that would be right from the point of view of the general public. We are all taxpayers, we are all consumers, and subsidies are paid to the producers with a particular object. But it would be very hard to justify 100 per cent.grants for 965 one type of industry, admittedly a skilled industry and one which has many risks—climate, soil and so on. Nevertheless, it is up to us farmers to improve our production and our land with the amount of subsidy that has been given to us. I hope the subsidy will not go down. It is 50 per cent. now, and that helps enormously with things like drainage, and with buildings, in order to be able to house more animals so that in winter time we can keep them in better conditions than out on the hillside in weather such as we have to-day and have had during the winter. But, as I say, I do not agree that we should ask for 100 per cent. subsidy; I do not think that would be fair.
We do want the Government to fight the battle in the E.E.C. to continue the regional policy and continue the grant. There must be millions of acres in Europe where the same type of hill farming is carried on, and I hope very much that our European colleagues in the Common Market will get the same treatment as we in Scotland, Wales and the North of England get from the Government to-day. So I would urge the Minister and the Foreign Secretary, and the other people working for us in Brussels, to carry on with their activities to get as much money as we can for the regional policies for agriculture. This is most important.
On the subject of prices, naturally one wants to get a fair price but one wants also to see that the consumers, the man and woman who go into the market and buy our products, get proper value for their money. I do not want to see prices outstrip the earnings of people for whom mutton and beef are essential products. I want the situation to be fair all round: the farmer to get a proper return on his labour; the agricultural worker to be properly paid and have good conditions in regard to housing and work, and the consumer to have good value. I think that the policy of the Government, so long as they stick to it and do not give way to people who suggest that we should get less, is the right one. I hope that they will continue to support the hill farming industry, wherever it may be, because I believe it to be in the interests of agriculture in general and in the interests of this country as a whole.
§ 3.30 p.m.
§ VISCOUNT THURSO
My Lords, like the noble Baroness, Lady Elliot of Harwood, I, too, am a hill farmer. I have been a hill sheep farmer since 1949. I think I can say we are now striding as far North as we are likely to go in this debate; having started in Wales and then striding to the Borders in one step, we find ourselves in the next step on the shores of the Pentland Firth. This in itself is a significant fact because what we should do first in this debate is to identify in our minds what we mean by a hill farmer and a hill farm before we go on to discuss anything else in relation to it. I submit first of all that latitude has as much bearing upon the difficulties of the type of farm we are talking about as does altitude. In my estimation what we are talking about are those farms which, by reason of soil, altitude, latitude or other natural causes, are so placed that there is a limit to the agricultural activities which can take place upon them. One of the biggest problems which faces the hill farmer is the limitation on the types of farming which he can under, take. On most hill farms, if things turn against sheep and cattle rearing he cannot turn readily to the cultivation of a crop or the keeping of other forms of farm livestock or to intensive methods. So I am taking a hill farm to be similar to the category which receives the hill farm subsidy, and not necessarily relating hill farming to altitude or to steep ness of ground, or anything of this sort.
In my part of the world, in the county of Caithness, on the farms which I farm, unlike the noble Lord, Lord Maelor, who is keeping one ewe to one and a half acres, I can count myself happy to keep one ewe to 100 acres. The maximum altitude to which the ground rises is approximately 1,100 feet, and it goes right down to sea level. At sea level we have poor soil which, in combination with our climatic conditions and with our distance from the market and other adverse factors, puts us not only below the noble Baroness, but also below almost any farm in the green hills of Wales. In considering this point we are really considering a category of farm which has natural disabilities which will never enable it to break through in any form into general agriculture.
967 What are the alternatives that we can consider for land of this sort? Is there any alternative? Should we plant trees? Should we clear the land altogether and leave it as desert, or should we say that we are going to endeavour to keep people on it to farm it? Before considering which of these alternatives we might accept, we ought to look at what this land can do as farming land. We have been told by the two previous speakers of the importance of hill farms in general to the sheep and cattle industries, the number of sheep and cattle they produce, the amount of wool they produce and of their importance to farming in general. I should like to underline this point. I agree with what has been said both by the noble Lord, Lord Maelor, and by the noble Baroness, Lady Elliot, that we cannot afford to lose many more of our hill farms if we are to supply low ground farms with the store-stock they require. When there was a recent outcry at the rising cost of meat and shortage of meat, one of the reasons why there was a shortage of beef and mutton in the market and for the housewife to buy was because of the depressed state which the big hill farming areas of Scotland, England and Wales had gone through in the late 1960s. I know in Scotland, in the hill areas of Ross-shire, Sutherland, Caithness, and Inverness-shire there are large areas, large hirsels, which have been cleared altogether of sheep, not by any sporting landlord but simply because people were going bankrupt and were unable to keep sheep on that ground; the hirsel could not pay the wages of a shepherd and maintain him in a job any longer.
On my own farming operation I am employing one man and a Landrover where previously I employed three shepherds. If I had not had the advantage of farming a fairly large operation I should not have been able to do this, The set-up would have consisted of three people, two of whom would have gone bankrupt and the other would have taken them over. That is the plight which has faced and is facing large parts of Scotland and, I would guess, England, Wales and the Borders, too.
What are the alternatives to this? Is forestry an alternative? I ask your Lordships to realise that not every hill sheep farm could be used for forestry. I 968 offered the Forestry Commission 2,000 acres for nothing, if we could agree on the location. I spent three days walking over the hill with the conservator and one of his men. At the end of the three days' walking they agreed that the areas I pointed out were the most likely places on which trees might grow. They commented sadly, "We have been offered poor land for forestry in our time, but never so much so poor." It was so poor they would not take it as a present.
§ VISCOUNT THURSO
It was indeed. Some years later, they got in touch with me again. They said, "Our new techniques and types of tree, our new provenances of seed, of lodgepole pine and sitka spruce have made it possible for us to think in terms of using some of your ground. We should like a piece of wet ground. Can you provide us with it?" I said, "Yes, how wet do you want it?" They replied, "As wet as you have got." I took them to a nice flow, the kind of ground which, if you bounce up and down on it it continues to shake for quite a while afterwards. I said, "Is this wet enough?" In a crestfallen tone of voice they said, "No, it's a bit too wet." I took them back to one of the areas I had offered them before and I said "Will this do?" They said that it would do nicely.
This was one of the areas that the previous conservator had agreed was one of the best. This they were considering, with the latest of techniques, to be worth doing a planting experiment upon. They have taken 100 acres of it as an experiment. They are using it as a tree bank because they do not think any other trees are likely to come near and cross-pollinate the trees that they have in this 100 acres. So you see, my Lords, forestry is not always an alternative. I think that one must try, if one is to preserve any form of use of this kind of land, to keep hill farming, hill shepherds, and hill cattlemen going. One is faced with this problem, but in return one is going to get not only a lively use of this land but a reservoir of hill sheep and hill cattle which are important to the rest of the farming industry. To my mind, this is the vital reason for preserving the hill farmer as a species.
969 In Scotland we have a very simple system of farming sheep which has gone on for many generations. On the harder hills you have your pure-breds, South Country or North Country Cheviots, Blackfaces. You cross that with something like a Border Leicester to give you a half-bred or a Grey-face; and you take the half-bred or the Grey-face down to the lower ground and you cross it again with a sheep of mutton conformation like a Suffolk or an Oxford. The result is a ewe on good ground with the hardiness and mothering qualities of her hill ancestors, the prolificacy of the Border Leicester sire, rearing two, two and a half or three lambs of good mutton conformation from their sire. This is a system which has been practised for generations in Scotland, and which eventually the scientists recognised and called stratification. It is indeed the backbone of the sheep farming industry in Scotland. I suspect that it is still the best form of sheep raising that any national farming system could undertake. Without the hill farmer, this system cannot be operated because it is the hill farmer who provides the reservoir of females from which the whole sheep industry is structured. Therefore, the hill farmer is of importance.
Finally, my Lords, we should ask ourselves what we should do about this situation; about preserving this important farmer who provides a reservoir of stock; who is keeping life going in large areas of our country so that if people want to go there for a holiday there is at least some life taking place and something to see; and who is providing the reservoir from which much of our sheep and cattle industry is drawn. What is the cure for his ills? I do not share, with the noble Lord, Lord Maelor, the optimism that one can produce this green revolution. I think it will always be a very hard row which the hill farmer will have to hoe. It will always be a very hard task; the farmer will always suffer from climate, even though climate may be only part of his problems; he will always suffer from the basic difficulties of the soil poverty which is built into his farm, the closeness of the rock to the surface, the depth of peat which lies below and so on. These will always be disadvantages from which he will suffer. He will always suffer from the difficulty that he cannot readily diversify. 970 Therefore, he is unable to build up the reserves which would enable him to go through his hard winters and come out on the other side; to go through the lean times when the market is against him and his industry, and so forth.
What we must do, therefore is support the noble Lord, Lord Maelor, in his assessment of how to help the hill farmer; that is, to see that he gets the capital grants, because he will always be working at a slightly lower level than the rest of the farming industry; always working at a slight disadvantage compared with everybody else engaged in the same occupation. Therefore he will always be less likely to be able to accumulate the strength, the capital and the reserves to modernise, to move forward with the times and that sort of thing. This is where I disagree with the noble Baroness, Lady Elliot. I am sure that in her heart of hearts she would agree, not to giving him a 100 per cent. subsidy—this is not it—but in making capital available to him. This may well be in the form of a 100 per cent. grant for some things if a crash programme is needed. It might be similar to what is offered to the fishing industry, a mixture of grant and loan. Why should we not consider a mixture of grant and loan to the hill farmer? By that I mean a loan at low rates of interest, because he is dealing with a very long-term form of industry.
§ LORD HOY
My Lords, will the noble Viscount allow me to intervene? I am not objecting to what he said, but I think it ought to be clearly understood that in the fishing industry they do not get cheap loans. They have to find their capital, and they have to pay for it. Provision is made for loans, but I can assure him that it is not done cheaply.
§ VISCOUNT THURSO
My Lords, I thank the noble Lord, Lord Hoy, for reminding us of this. I am saying that in the case of the hill farmer, he may very well not have the capital at all. We are talking about the fellow who, far from having the 50p to go with the other 50p, may not have the 50p at all. He may well require a loan to go with his grant. If he gets a grant and a loan it could be either a 100 per cent. loan or a 100 per cent. grant, or a 50 per cent. grant with a 50 per cent. loan, or however you like to look at it. But it is a help 971 to him to get a loan that will enable him to take up the grant. The problem is that sometimes people cannot take up grants at all. I feel that in addition to a grant or loan, one should consider the possibility of giving him farming loans at advantageous rates of interest, because this is very often a difficulty when you are taking on a loan for a very long period of time. It is difficult to take on a loan at high rates of interest. This is why the Agricultural Mortgage Corporation at the moment is not doing as good a job as it might otherwise be able to do. I think this is the primary way in which to help him.
Also, one has to see that the hill farmer forms part of a prosperous agriculture, and a prosperous agriculture where the end product, which he is producing, is required and for which he is receiving a proper return. Because the hill farmer depends upon the prosperity of the low-ground farmer to whom he sells his stock. If they have a bad harvest in the Lothians or in the North of England, the Thurso lamb sales are depressed; the farmers who would buy the store stock at Thurso are not coming to bid because they are fighting with their harvest problems and have not the cash. So, my Lords, to sum up, we need to ensure that the hill farmer has capital available to him through grant and, if necessary, loan; that he is part of a prosperous farming industry; and that we recognise his importance to the rest of the farming industry and to the country as a whole.