HL Deb 18 December 1980 vol 415 cc1244-7

2.24 p.m.

Lord Sandys rose to move, That the draft regulations laid before the House on 2nd December be approved. The noble Lord said: My Lords, on behalf of my noble friend Lord Ferrers, I beg to move that the Hill Livestock (Compensatory Allowances) (Amendment) Regulations 1980, a draft of which was laid before this House on 2nd December 1980, be approved. These regulations, which apply throughout the United Kingdom, amend the Hill Livestock (Compensatory Allowances) Regulations 1979 and give effect to the higher rates of hill sheep and hill cow allowances which my right honourable friend announced on 28th November.

Hill and upland farmers play a particularly important role in the livestock sector of our agriculture. They provide, in the United Kingdom as a whole, some 60 per cent. of the specialist beef cow herd and 20 per cent. of the total beef and dairy breeding herd, while the proportion of the hill sheep to the total of the breeding flock is about 55 per cent. The role of the hills, therefore, is fundamental to the cycle of renewing the national breeding flock and the production of suckler calves and store lambs.

The importance of hill livestock farming is not, however, confined to its production role. In much of the hill and moorland areas of this country, the raising of livestock is the only possible use of the land, other than forestry. Hill farmers play a vital role in the economic and social structure of these areas. Your Lordships will not need reminding of the special problems facing hill farmers. It is because of these problems that we have a long tradition of providing financial aid in the form of annual headage payments on hill cattle and hill sheep.

Since 1976, these payments have been made as hill livestock compensatory allowances under the provisions of the EEC less-favoured areas directive. The areas in which they are paid cover much of our traditional hill farming and livestock rearing land. Last autumn we found that the hill farmers were faced with the unenviable prospect of seeing their net incomes fall sharply as a result of a number of factors, including the ravages of the bad winter of 1978–79. We accordingly decided to increase hill livestock compensatory allowances by a record amount.

Our hope, and that of the industry itself, was that the hill farmers would have a better year in 1980–81. Unfortunately, when we reviewed conditions this autumn we found that although incomes in some areas are expected to be rather higher than last year, others will undoubtedly be much lower, and overall they remain below the level of two years ago. We concluded that further assistance is required if this vital sector of the industry is not to go into an unacceptable decline.

The regulations now before the House therefore provide that the rate of allowance for hill cows should be raised from £35 to £42.50, an extra £7.50 and the highest ever increase, while the higher rate for hill sheep will be raised from £5.50 to £6.25, an extra 75p. The lower rate of hill sheep allowance will remain at £4.25. This means that the differential between the higher and the lower rates of hill sheep allowance has been increased, which reflects our judgment of the balance of need and accords with the wishes of the Farmers Unions. The regulations, additionally, implement a change in the maximum rate of allowance per hectare payable under the less favoured areas directive. The maximum payment will now be £60 instead of £40.58, an increase of £19.42, and will benefit the small minority of farmers who stock heavily with both cattle and sheep on the same land.

These increases, which will add some £12.4 million to the total value of compensatory allowances in 1981, can be viewed as part of a range of measures which will provide assistance to hill farmers. Thus, the £12.37 suckler cow premium, added to the £42.50 compensatory allowance, will means that the hill farmers eligible for both forms of aid will stand to receive £54.87 on each of their breeding cows. As for the hill sheep, although the sheepmeat régime came in too late to have much effect on store market prices this year, the longer-term effect should be highly beneficial and the hill farmers will be entitled to the sheep annual premiums on their breeding ewes.

The higher rates of compensatory allowances, coming at a time when there are continuing severe constraints on public expenditure, have been generally welcomed by the Farmers Unions. They provide further evidence of the importance we attach to the economic and social well-being of hill farming. I therefore ask the House to give its support to the motion.

Moved, That the draft regulations laid before the House on 2nd December be approved. [3rd Report front the Joint Committee.]—(Lord Sandys.)

Lord Peart

My Lords, I welcome very much what the noble Lord has said. As a former Minister of Agriculture, I have always thought that the hill-farming community deserve tremendous support. They have a much more difficult task than the Southern England farmers. The hill-farming areas are vulnerable in many ways and I am glad to see a hill farmer nodding approval—the noble Baroness, Lady Elliot of Harwood, farms in Scotland and is especially involved in this. I have always taken the view that the hill-farming community should be backed and therefore I could not oppose this. I think the Government have done well and I am glad that they have taken this action. I should just like to clear my mind on one figure; was it £2.4 million?

Lord Sandys

No, my Lords, the total increase was about £12.4 million.

Lord Peart

My Lords, that is money well spent. I approve of it and in no way will I delay it. It is first class for the hill-farming community.

Baroness Elliot of Harwood

My Lords, on behalf of the hill-farming community I thank the Government very much for this admirable proposal. It comes at a crucial moment and also at Christmas and I look upon it as a slight Christmas gift from the Government, for which I am exceedingly grateful.

Lord Sandy's

My Lords, we have had a brief but useful debate on these regulations and I am grateful to your Lordships for the support that has been expressed. I am particularly grateful to the noble Lord, Lord Peart, a former Minister of Agriculture who speaks from particular experience in this field and also my noble friend Lady Elliot of Harwood who speaks from day-to-day experience in this vital sector of the farming industry.

The Government are aware that the increased allowances will not fully compensate hill farmers for their reduction in income but they will make a significant contribution to a solution to the problem. I believe the House recognises that in the light of the present severe constraints on public expenditure these increases, coming on top of last year's substantial increases, are further evidence of the Government's commitment to the hill livestock sector and to the welfare of hill and upland areas generally.

On Question, Motion agreed to.