AGRICULTURAL LIME SCHEME (EXTENSION OF PERIOD) ORDER 1974 (Hansard, 17 July 1974)

§ LORD STRABOLGI
My Lords, I beg to move that the Agricultural Lime Scheme (Extension of Period) Order 1974, a copy of which was laid before the House on July 2, 1974, be approved. An Order was las approved in 1969 to operate until the end of this month and the purpose of the Order now presented is to continue from that date for a further five years the authority by which payments are made to farmers as a contribution towards their costs in liming agricultural land.
The subsidy was introduced to encourage liming so that an improvement in 1197 soil fertility could be achieved. Since the inception of the lime scheme in 1937 uptake has increased from ½ million tons to cover 6 millon tons in the late fifties and early sixties, when the backlog of poor condition was being corrected, and in recent years it has fallen to maintenance levels of about 4½ million tons. The lime status of our land must not be allowed to deteriorate, particularly in areas such as the hills. I am sure your Lordships will agree that this valuable and important agricultural practice ought not to be neglected and the help given by way of subsidy—approximately £5 million annually—should continue. Approval of the Extension of Period Order will allow this to happen. Our concern now, I sugguest, is simply the Order which gives authority to make payment and not the rates of subsidy or the Scheme itself which in contained in a separate Instrument.

EARL FERRERS
My Lords, again we are grateful to the noble Lord, Lord Strabolgi, for explaining this Order. I commend the fact that he refrained from saying that the previous Government were, in fact, not going to continue the present Administration in their beneficence are to do so. He must have felt hard pressed to restrain himself over that, and I commend him on it. Of course, as he knows full well, only limited funds are available to the agricultural sectors and it is open to opinion as to how they are best spent. The noble Lords' Administration consider that the lime subsidy is a good one. It will certainly be a very valuable subsidy and will be appreciated by those who will avail themselves of it.
I wish to ask the noble Lord only three questions, and I should be grateful if he could give me the replies to them. I let him know in advance the questions which I would be asking, because they are of a technical nature. Is the granting of a lime subsidy, as this Bill permits, in accordance with the Community regulations, or is it in contravention of them? Indeed, how do the European Economic Community's Regulations affect the granting of such a subsidy? Is it the case 1198 that they could be regarded as unfair national subsidies which would create unfair trading between countries? I should be grateful if the noble Lord could give your Lordships' House some enlightenment upon that point. The last point is that the noble Lord said that this subsidy would run for five years. I am not quite clear whether this is an undertaking that there will be a subsidy for five years, or whether at is merely the provision of Treasury funds to enable the Minister annually to decide whether or not to make available a lime subsidy. If the noble Lord could answer those questions, I should be grateful.

§ LORD STRABOLGI
My Lords, I am grateful to the noble Earl. I have always had such a cordial relationship with him, and have had so much courtesy from him, that I did not think it was fair to remind him that his Government were not going to continue the subsidy when it came to an end at the end of this month. However, I am very glad that he has now had second thoughts upon that point. With regard to the specific questions which he asked me—and I am grateful to the noble Earl for giving me notice of them—

EARL FERRERS
My Lords, I did not say that I had had second thoughts. I was merely giving the Government a bouquet which the noble Lord had failed to give himself.

§ LORD STRABOLGI
My Lords, I am grateful. On the question of the E.E.C., production grants such as the lime subsidy may be incompatible with the conditions for competition in agriculture under Articles 92 to 94 of the Treaty. However, these general aids have not yet been considered and may, indeed, not 'be reached for some time yet. I am afraid, therefore, that I cannot say more than that. With regard to the effect of the subsidy, the draft Order has no effect upon the conditions of the lime subidy Scheme or the rates of subsidy. It is simply the authority by which Ministers may make payments within the terms of the existing Scheme or any subsequent Scheme. Therefore, the extension, for five years is permissive. It does not bind Ministers to continue the subsidy for that, or any period, and it is reviewed annually.