EEC RURAL AREAS AND AGRICULTURAL STRUCTURES

HL Deb 06 March 1980 vol 406 cc406-63

3.38 p.m.

Lord SANDFORD rose to move, That this House takes note of the 27th Report of the European Communities Committee on policies for rural areas in the European Community (H.L. 129) and of the 15th Report of the committee on policy for agricultural structures (H.L. 63). The noble Lord said: My Lords, I beg to move the Motion standing in my name on the Order Paper. I should like to start by recording my thanks to my un-named colleagues on the Select Committee on Community affairs for their help in producing a report for your Lordships to debate. Coupled with that go our thanks to our staff and to our specialist adviser, to our 60 witnesses who were good enough to supply us with evidence, and to our eight embassies, among the other members of the Community, who provided us with views relating to the countries to which they were accredited. I should also like to welcome the distinguished speakers who are participating in this debate and adding their opinions on this matter to those which we have already harvested.

As a preliminary, perhaps it would be as well for me to say a few words about the nature of this report. Most reports coming from the Select Committee on Europe amount to comments from our Select Committee on a draft proposal which has come from the Commission. Others are very different from that and have served to focus a wide range of opinion on an important and perhaps neglected topic on which the Commission has not pronounced at all or, if it has pronounced, has not pronounced at sufficient depth, range or width. We have produced previous reports of this kind—one on enlargement in March 1978, and another on the relationships between the United Kingdom Parliament and the European Parliament, which was completed in July 1978.

Ours, which we have nicknamed "Arcadia "—I shall come to that in a minute—is in this latter category. I hope your Lordships will agree that we have at least succeeded in concentrating a wide range of opinion on an area which deserves more attention than it has been getting. We have no doubt that we have done little more than make a start, and we are quite certain that a great deal more work needs to be done. I hope that this debate will have the effect of ensuring that more work is in fact done.

I said that we code-named this report "Arcadia" and I should like to explain why. Arcadia is in Greece—the next applicant country to joint the Community. Arcadia in present-day reality is an inaccessible, impoverished, upland plateau in the Greek Peloponnese, but in legend and in aspiration it was thought of in Greek classical literature as the ideal rural place in which farming and recreation are delightfully combined, in which shepherds sit playing their pipes, basking in the sunshine among their flocks.

Enlargement will bring thousands of hectares of countryside like the real Arcadia into the Common Market, and thousands of poor peasant farmers like the Arcadians into the Community. We have to ask ourselves what are the chances of their hopes of a higher quality of life approaching the ideal Arcadia being fulfilled. What hopes are there of their expectations of democracy being met? Will our already over-stretched resources stretch far enough further to meet their basic needs? We have to go on and ask whether the intractable and wasteful Common Agricultural Policy, as it has now become, so direly in need of reform already to serve the needs of the Nine, will have been remoulded by this time next year, when Greece will be in the Community, to deal effectively with the needs of the Ten, and capable of being reshaped further to deal shortly after that with the needs of the Eleven and the needs of the Twelve.

Another question mark is, will the impending review of the Regional Fund have been carried through in time to cope with the enlargement which will make this Community more rural, more southern than it is now, in the 1981s, 1982s, 1983s? I believe the whole House will agree that it is extremely difficult to be confident about the answers to any of these questions. Perhaps after the debate after this one some of your Lordships will gain confidence on hearing what the Three Wise Men and the Spierenburg Report have to say about the likely capacity of the European institutions to grapple effectively with problems like these.

So far the only sign of a fresh look at the need for rural policy comes in Directive 5720/79, to which our report refers. That is the only directive so far indicating a fresh approach to rural problems in the Community. This does no more than offer the prospect of three relatively small pilot projects of so-called integrated rural development in the Western Islands of Scotland—I hope that the noble Lord, Lord Mackie, may tell us a little about how that is viewed up there—in the department of Lozère in France (a department which contains the uplands of the Cevennes;Robert Louis Stevenson country), and the Ardennes in Belgium;an area of Belgium rather confusingly called the Province of Luxembourg.

Side by side with these question marks relating to the whole Community there is an undoubted need, when you look at things nationally, for new departures in rural policy. During the preparation of our report the central Government here have completed the countryside review with five reports: Problems and Policy in the Countryside;Food Production in the Countryside; a report on rural communities;Leisure in the Countryside; and most recently published since we completed our work, Conservation and the Countryside Heritage.

Before we started the Association of District Councils had expressed their anxieties in a paper they entitled Strategy for Survival. While we were working the Association of County Councils produced theirs called Rural Deprivation, and since we have finished the National Association of Local Councils have produced their further report called Change or Decay. So there is a good deal of interest and anxiety in this country on this topic as well.

It would be tedious of me to go through the report chapter by chapter, and still more paragraph by paragraph. All I want to do is pick out in my own personal way three themes which, it seems to me, are particularly sharp and calling for attention;broad issues which appear from the evidence given to us. The first is a challenge to the claim that food production is the primary land use of the countryside. That sounds convincing. It may have generally been true, and in some parts of the countryside it still is true. But if the Community is looked at as a whole it cannot be true to say, when we are generating large and expensive surpluses of milk and dairy products, wine, sugar, et cetera, that it is a primary use of all our land to go on generating these surpluses. There must be more useful things which can be done with some of the land in some of the countries in the countryside.

The problem surely is how and where to stop and curb this wasteful and unnecessary production of food which is not required. It is not as though there were no other strong claims to the use of land in the countryside, and to the use of land in the countryside in this country in particular. I am not a landowner but my understanding is that as well as being one of the best countries in Europe for growing grass we have some of the best conditions for growing timber. It therefore seems to me extremely odd that there should be only one other country in the Community which has a lower proportion of its land dedicated to the growing of trees.

I should have thought under present circumstances that that is another form of diversification which we ought to be pressing forward with energy. I say no more about that because I believe that there is a debate on forestry before very long in the name of the noble Lord, Lord Dulverton. However, it indicates that we must look less to the exclusive use of rural land for food production and more to the integrated use of rural land for forestry as well as farming, and for amenity and recreation as well. There is an absolute necessity to strike a better balance in the use of rural land.

The second theme which seems to me to be particularly striking in the evidence which we have had is the view that not all the agricultural technologies now being advocated are as appropriate as they were some years ago. Can it be sensible to be advocating technological advances in agriculture which require more and more use of expensive and rare chemicals which have to be imported, particularly fuel which we need to conserve and of which we know the supply is limited, and at the same time to be adopting argricultural technologies which require less use of labour, and have the effect of forcing young boys and girls to leave the land of their fathers and to add themselves to the thousands of unemployed people who are already in the industrial cities? The Mansholt plan, which had that effect, might have been a good thing 10 years ago, but I very much doubt from the evidence we are getting whether it is a suitable policy to continue to apply so vigorously in present circumstances.

I would point out as an exemplary exception to this our own upland sheep farmers, who have enormous success over, say, the French, and who achieve it with the consumption of a minimum amount of fuel and the use of a minimum amount of materials, largely by their own skills, the skills of their dogs and the hardiness of themselves, their dogs and their flocks. That seems to be an admirable example of a highly appropriate technology which should be thought about throughout agriculture. Surely, therefore, the trend of professional advice has to change in this field, too.

The third strange feature which seems to emerge strongly from our evidence is the very high value and esteem set by all our people on our rural heritage in its totality and diversity and the need for the rural communities it keep it all alive. Side by side with that we have the anomaly that this village life is showing every sign of frailty and tendency to break down, and the economy which supports it is getting weaker and weaker and more and more vulnerable. Examples of this come up time and again. Last month it was the threat to rural sub-post offices. Next week, when we are discussing the Education Bill, it will be the threat to rural school buses. But there are also the pubs, churches, village halls and all sorts of other rural institutions which are all highly regarded, esteemed and valued but which are threatened, one after the other, by some development in central or local government policy. The reason is that it is always possible to demonstrate that a particular rural service is uneconomic and therefore should be cut, but it can be done only by neglecting and overlooking the enormous intangible and unmeasurable values and internal resources which are possessed by every village, and we must do more work to ensure that that factor is not so often overlooked.

We are therefore faced with the need to find ways and means of achieving a more balanced use of rural land and pursuing what the Commission call "integrated rural development", and that seems to lead us to a choice, broadly speaking, between two methods: the first relies on planning and planning control, which farmers like so long as it is used to prevent the loss of agricultural land;on the curbing of afforestation, which amenity lobbies like, so long as it is used to curb the spread of afforestation;and on development control, which nobody likes but in which the planners are nevertheless actively engaged. This way of proceeding, it seems to me, has two major disadvantages: it is all negative and it is impersonal.

Fortunately, there is a choice. We have the way of proceeding by means of positive management agreements as to the use of rural land, and the Less Favoured Areas Directive for use in those areas provides a good framework for a good deal of this;a way of harnessing farming, conservation, tourism and other rural activities together. The sad irony is that the Ministry of Agriculture in this country makes far too little use of it. The national park management plans now available in all our 10 national parks provide a more detailed framework in which management agreements can be operated, and one hopes that the Countryside Bill, which contains provisions for making management agreements more effective, will not be much further delayed. The great advantage in proceeding in this way is that the energies and enthusiasms of private farmers and landowners can be engaged in a positive way in the development of their own holdings, both to provide their own private objectives and to mix these with other objectives.

But if this is to be done on any scale, many farmers, and particularly smaller farmers, will need a broader range of professional advice. Fortunately, our own Agricultural Development Advisory Service, and no doubt other extension services elsewhere in Europe, have recently accepted in principle a wider remit, as was recommended by the Strutt Report last summer. But under present circumstances they are most unlikely to be allowed to engage any more members to undertake such a role, and, if the arrangements for administering farm capital grants are developed on the lines about which we were hearing last week, it seems there will be less engagement between the advisory services and the farming community. In those circumstances, it seems that we have to look for supplementary professional advice on multiple land use and to ask from where that will be forthcoming: I shall be interested to hear during the debate how noble Lords think that is going to be provided.

Finally, I come to our view that for this to proceed we need to have a European statement of objectives for rural land use. It is not fashionable to suggest any change to the Treaty of Rome and we are not proposing one, but we are recommending something of the same size, character and shape as the clause in the Treaty of Rome on which the Common Agricultural Policy is based, and because that is significant I will read the relevant passages. The aims we suggest are: To make the best use of rural land and all its varied potential, and in particular to exploit responsibly the natural resources of the land for the production of food, timber, water and minerals;secondly, to promote the economic prosperity and social wellbeing of the whole rural community, including those not directly dependent on agriculture for their living;thirdly, to conserve the character of the countryside landscape and the wild life within it;and fourthly, to provide all practical access and facilities to the public for tourism, recreation and sport". We all appreciate that that is a very tall order, far easier said than done, but we believe it can be done and we have indicated some of the tools of policy by which it can be done. Above all, we believe it is imperative that we do better in fulfilling these aims before the EEC tries to encompass and embrace the countryside and countrymen of Greece, Portugal and Spain. I beg to move.

Moved, That this House takes note of the 27th Report of the European Communities Committee on policies for rural areas in the European Community (H.L. 129) and of the 15th Report of the committee on policy for agricultural structures (H.L. 63).—(Lord Sandford.)

3.58 p.m.

Lord MACKIE of BENSHIE

My Lords, I wish at the outset to congratulate the noble Lord, Lord Sandford, and his committee on the very production of the report. Anyone—and many of your Lordships have—who has sat on an EEC scrutiny committee knows the literally inches or feet of bumf one has to wade through, the many interesting witnesses one has to hear and the enormous amount of sifting one has to do. The production of a report at all is a miracle, and for producing a good one the noble Lord and his committee deserve our congratulations.

I must disagree with the noble Lord slightly in his strictures on the agricultural policy. He is of course entitled to his view, but he said he was not a landowner or farmer and was therefore slightly ignorant. Nevertheless, it is right and proper that people who are not professionally engaged on the land should look at the land and its problems. I should also like to tell the noble Lord that the picture he painted of a happy Arcadia for our hill shepherds in this country is slightly askew. They depend upon helicopters to spray bracken in order to knock it down. When they roam the hills with their dogs the main instrument they carry is a syringe, in order to interfere with their sheep! Scientists have done enormous good for hill farming by producing vaccines against all kinds of ills. So the Arcadia is helped by the modern world.

It is very encouraging to see that the EEC realises what it is going to do;and when I say the EEC I mean us—that we realise what we are going to do to the rural areas. The tradition and the pattern are well known. When industrial production is built up and the nation becomes wealthy people leave the land, and at the same time the land is industrialised, and people flock to the towns. If we do not watch out, we shall have 300 million people in places such as Birmingham, London, the Ruhr, and parts of North Italy, and the rest of Europe will be in a sorry state, hardly able to maintain its services. Perhaps there will be a few areas, such as Yorkshire, and so on, which will survive. But, quite seriously, on the whole what happens is that people leave their traditional occupations;there is, for instance, the cobbler in the village who goes to work in a factory which produces shoes which people later throw away.

Basically the problem is one of people. I recall an interesting point mentioned when I attended—naturally—my father's funeral. Many of his old men were there, and we were reminiscing about old times. One of them said—and I shall not say it in Scots, because a large number of your Lordships would not understand: "There's not the fun on the farms nowadays". A cleverer chap said, "There aren't the folk on the farms nowadays". I believe that that is the basis of what we are discussing—the need to maintain a healthy, virile population, living useful, not ornamental, lives;not Arcadian shepherds, but useful, practical people who like to live in the countryside and can afford the services. I must say that the committee did extraordinarily well in paragraph 53 of their report when they tried to define this point. They acknowledged the central role of agriculture in the economy, but they went on to say: it has become unrealistic to expect the primary land-based industries to sustain rural economies on their own". That is absolutely right. We must accept that if we are to maintain enough folk in the countryside, we must, along with agriculture, develop the other uses of land, ranging from forestry to tourism, as well as manufacturing in small or large factories—but factories which are suitable for the area and in which part—time farmers and others can get a living. This is not easy to do—I have had quite a lot of experience of it—but it can be done. It has been done in Germany, and in parts of France. We must look to manufacturing, along with forestry, in order to supply the extra people needed to keep the areas viable and virile.

The easiest thing to do is to tackle the natural assets. In other words, I have found that where there is an area of great natural beauty one can put money into tourism and into training for tourism, which is just as important, and one will get an economic reward. I believe that tourism is a natural asset in our country areas, and that it will be needed more and more as people in the towns, in the great areas of the Ruhr, London, and Birmingham, in this apex of industry, increasingly need to go to the countryside. Where there is an enormous area of concentration of power, such as we are moving towards in Europe, one has to look after the periphery;and the periphery is enormously important.

I do not want to speak for much longer on the general theme. The report makes a number of other excellent suggestions about how we should tackle this subject. There is the central point, as the noble Lord, Lord Sandford, said, where they ask for a definition of rural policy. This is very important, and I believe that we, too, in Britain must define what we mean by a policy for the rural areas. We have done more than many other countries in this regard. I think of the Highlands and Islands Development Board, the Crofters Commission, the various bodies in Wales, the experiments in the Pennines, and many other areas of government and of popular and proper activity.

We should seize again on the three experiments mentioned in the report, and which are in hand, though they are not progressing very fast. In particular, we should push for the one which is designed to spend a great deal of money and do something for the Western Isles. I know a little about the Western Isles, and this is the ideal area on which to start, although I think that the area should be widened to include the rest of the Highland area on the coast opposite the Western Isles, which might be in more need. That would be a better, larger, and more integrated area with which to start. Somehow or other, the Western Isles has managed to hold on to its population, so there is something which one can preserve, which is much easier than trying to build up again after it has all broken down.

We have had many experiments in the Western Isles. Lord Lever—not the present one, but the one connected with Unilever—spent an enormous amount of money 50 years ago trying to turn that area into a fishing and packaging centre. Of recent years he failed because the matter fell down over the question of land. When one tackles land as a centre one begins to come to a proper solution, particularly in areas like the Highlands.

In the Western Isles we had an adviser connected with the agricultural college, Mr. Gillespie, who was a marvellous natural leader. He persuaded many crofters to take advantage of the Government subsidy for the reclamation of land, and they poured, at a 100 per cent. subsidy, the shell sand from the sea shore on to peat and a large amount of the Western Isles which was formerly peat hag was reclaimed into grass. That was most successful. But it is going back now due to the lack of this same lime subsidy.

I believe that this Government, too, should put up £10 million, as the EEC wish to do;it ought to be matched by us. We should do this, but we should apply the knowledge that we have to the hopes and the kindness of the larger body, the EEC, because to pour £20 million into agriculture in the Western Isles would be ludicrous. The annual budget for the whole of the Crofters Commission is only £1½million. To put £20 million into a small area, in agriculture alone, would be quite wrong. This is precisely what the report talks about—and that is widening the basis. It must go into tourism, agriculture, forestry, land improvement, and transport, too, which is also enormously important.

Another point made in the report which I consider is very valuable is that we really should not expect Brussels to try to run affairs in the Western Isles. They must put forward the policy, and then it must be administered by the bodies who know something about the area. We really must not in Brussels build a bureaucracy which tries to run the crofters of the Western Isles, because they will not be run in that way. It is difficult enough to run them in any shape or form, but to run them from Brussels would be absolutely impossible. If we can get the money and the spirit organised, and then follow it up ourselves, we can make in the Western Isles a very good experiment which might show us how to handle this problem, which will affect the whole of Europe. I must commend the report.

4.10 p.m.

Baroness STEDMAN

My Lords, I should like to associate myself with the noble Lord, Lord Mackie of Benshie, in offering our thanks to the noble Lord, Lord Sandford, for giving us the opportunity to debate this report this afternoon. I should also like to congratulate the noble Lord on his very clear presentation of the report, and his committee on producing such a readable report which we can understand and find so interesting. I want to deal with only two particular aspects, but in rather general terms. For my sins, I happen to be one of the vice-presidents of the Association of District Councils, and they have asked me to say how much they warmly welcome the report because the conclusions which are expressed in it are in accord in so many ways with the views which they expressed in their evidence to the committee. They wanted that to be on record, that they warmly welcome the report of Lord Sandford and his colleagues.

Like so many other bodies which submitted evidence to this committee, they believe—and I believe the committee have supported their view—that the full potential of the rural areas is going to be realised only when there is a truly comprehensive approach to rural policy which aims to safeguard the future of the rural communities. I accept that there is a considerable variety of types of rural areas within Europe;and, while it may not be realistic to seek a comprehensive rural policy for the whole of the Community, there are a number of areas where there is scope for improvement in policy-making as it applies to the rural areas in this country. Maybe action here and in our partner-States in Europe could be stimulated if we could have more consideration of the relevant issues that occur to all of us at Community level.

The Association of District Councils is one of those blanket organisations which, through all the district councils, in effect covers the interests of the whole of the rural population of England and Wales;and, like many other organisations and individuals, it is very concerned about rural deprivation and depopulation, and also about the present application of the Common Agricultural Policy. As the noble Lord said in his introduction, the Community is about to be enlarged, and the Common Agricultural Policies have a direct influence on both the general prosperity and the level of employment in agriculture in all the Member States. So far the CAP has been encouraging the movement towards more mechanisation and larger units, and to some of us it would seem that they have not always been completely aware of the impact of their policies on the social and economic conditions in rural areas. If there is to be a positive and co-ordinated approach to the problems, then there must be an increase in the resources at national and local levels, and indeed at European level.

The ADC believes—and I think, again, this view was shared by the committee—that the major problem is the reliance at this point of time on three separate agricultural, regional and social funds, each working in somewhat watertight compartments and, it would seem, without very much attempt at co-ordination in the way in which they apply and implement their rural policies. As the noble Lord, Lord Sandford, suggested, this lack of coordination, and sometimes conflicting policies, have given momentum to the decline of the rural areas. Agricultural employment goes down, the indigenous country-dwellers have to leave the rural area and go to the urban district to seek work, and their place is taken by retired people and by commuters who move into the country for their place of residence. This is the kind of changeover which upsets the whole basis of our rural society, and generally means an increase in those of the older age groups and a corresponding decrease in the younger age groups within our village communities. These changes in themselves have a very significant effect on employment, on housing, on education, on transport and on all the Community services;and the rural policy of the EEC must be better co-ordinated and integrated if the drift from the rural areas is to be reversed.

Action is needed to create more employment opportunities on the lines of schemes sponsored by the Development Commission. There must be better housing facilities, with reasonably-priced houses for sale and to rent, and perhaps encouragement to housing associations to do more in our rural areas. There certainly must be better transport and community and social services. I am one of those who regret the present tendency of some of our county councils, in our present economic state, to talk about selling off their smallholding units. The present trend towards larger farms may help to provide a career structure for those who want to help in agriculture, but there are very few opportunities for young people to start farming on their own account;and in many areas the smallholding is the only avenue open to meet a very real and continuing need. I hope that our Government will give positive encouragement to the local authorities to retain their present smallholdings, and indeed to create new and additional ones where possible, and will urge that other countries look at similar sorts of schemes.

One other aspect I want to put to your Lordships is the impact of EEC policies in rural areas which are not in assisted areas, and where central support from Government is limited. As noble Lords will know, I come from Cambridgeshire, and that county submitted fairly detailed evidence to the committee. In the East and North-East of that county we have the very highly productive Fenland, unlike the wide open spaces, haunted by the shepherds playing their pipes, of the Arcadia described to us by the noble Lord, Lord Sandford. The land is rich and the land is very fertile, and 25 per cent. of the jobs in that area are in agriculture and horticulture. Most of the industrial activities in that area are also concerned with food processing, with packaging, with canning and with agricultural engineering.

The county council took a long, hard look at Fenland and its problems in relation to its structure plan, and the problems of Fenland must be shared by many other parts of this country and by many other pockets throughout the Member States. The county council found that over the last 15 years there had been very little population change but a very marked decline in the number of jobs available. The area is a remote and scattered one, and rural isolation is one of the biggest problems. A very high (if not the highest) level of unemployment in the county is in Fenland, and there is little or no opportunity for school-leavers. Many of the unemployed are unskilled, and can therefore compete for only a very limited range of jobs;and the deteriorating employment situation both reflects and contributes to the other problems of the area.

This part of the county is not very accessible, with only the A.47 as the principal link between East Anglia and the Midlands, but it also has an important rail link between the Haven ports and the Midlands and the North. The housing conditions in the area are relatively poor, and a much higher than average proportion of the dwellings lack real basic amenities. Poor accessibility, limited services and facilities, and relatively few skills in the local labour force, all reduce the attraction of the area for future employers, and the county council have accepted that in this case the problems need to be tackled by strengthening the economic base. Here, they are in effect trying their own form of integration, by involving all their departments and some of the central Government departments. They want a major re-orientation of county council road programmes to give improved access into Fenland, so they are pressurising central Government to try to improve the A.47 road. The Development Commission have come to their aid;they have declared Fenland one of the special investment areas, and factory units are being constructed. They have encouraged the district council to build mini-units in the county, and the district council and the county council between them are trying to make available serviced industrial sites for development.

They have also involved the British Waterways Board, and are jointly investigating with them the potential use of the Wisbech port to handle European traffic;and the Peterborough Development Corporation are offering their services and expertise in helping them with selective industrial promotion and also in preparing a brochure for use by their Members of the European Parliament to press the case. The county council is also planning to strengthen and reorganise their secondary education and have a reprieve from the DHHS to retain their hospital at Wisbech.

These are some of the things that can be done when people start to work together and to integrate their policies. But, despite all efforts, the areas' problems are still immense. They need the support of a much wider range of public investment bodies and the confidence of private investments. This is where EEC grants and supports would prove invaluable. The present and threatened cuts in public expenditure pose a very real threat to today's level of services and, as the Cambridgeshire report to the committee said— If the present generally depressed level of services, including public transport, education and health, cannot be maintained, even additional employment opportunities will not maintain balanced rural communities, and prevent the area's younger and brighter citizens from drifting away, the downward spiral which is widening the inequality with urban facilities, will not be arrested, but rather could be accelerated". The Community funds which are available, the noble Lord, Lord Mackie of Benshie, said, had to be additional to what we put in ourselves and not a substitute for it. In the short term, the efforts of the Community must be concentrated on ensuring that the existing funds arc administered as cost effectively as possible. The current problems that arise from the CAP and the wider question of the Community budget are substantial and very complex, but I feel that this report provides an excellent start for ensuring that the wider questions of the EEC rural policy are given proper consideration in that context.

4.22 p.m.

Viscount AMORY

My Lords, I am very glad of the opportunity to follow the noble Baroness, Lady Stedman. She has an excellent knowledge of these difficult problems from the angle of local government. If she will one day do me the honour of coming across to the "Garden of Eden "in Devon—and she can leave all her warm clothes behind her—I hope she will bring with her a few thousand tons of that marvellous black soil from the Fenlands;provided that it does not blow away, as we have quite a wind.

The report which my noble friend Lord Sandford has introduced so skilfully this afternoon is not only interesting but is a very timely one. The theme, the key, can be found in the first paragraph of the report, in a single sentence which reads: A large proportion of the rural population now earns its living from activities other than agriculture or horticulture". That is very true. The structure of agriculture in Northern European countries has changed out of all knowledge over the past 30 or 40 years, and the number of persons directly employed has been enormously reduced. In some countries, that process is not by any means completed and will go a good deal further. Personally, having lived in the country all my life, I deplore the loss of so many agricultural workers who I always thought formed as fine and as wise a section of the community as anyone could know. There is one remark made by an old farm worker that I have always remembered: "Dogs look up to you, cats look down on you, pigs is equal." I think that is one of the shrewdest remarks I have ever heard.

The Common Agricultural Policy is almost exclusively concerned with agricultural production—a very important facet but not the whole of the problem of rural areas, as my noble friend has clearly outlined. The efforts to safeguard and encourage efficient agricultural production—and when I say "efficient ", I refer to the efforts to increase the volume of agricultural production—have resulted in the currently alarming surpluses. Much of European agriculture is nothing like as efficient as the average level in the United Kingdom. We must also accept that, owing to technical changes in agricultural structures, a satisfactory return to agricultural producers directly benefits fewer persons every year as is mentioned in the report. Having said that, the level of efficient agricultural production and productivity is very important, but is not the whole picture. I am not sure that I will go as far as to say that food production is not the primary use of land, but it is certainly not the only use.

One question which has to be answered is this. Is there rural deprivation in the United Kingdom? The answer, I am sure, is: yes, there is some. There is a climate of deprivation in some localities and there are elements of deprivation in the lives of some of the rural inhabitants of most areas, particularly perhaps in the case of the elderly. The age of the rural population is higher than the average because of the dearth of employment opportunities for young people in their own villages. I agree entirely with my noble friend Lord Sandford on that and I would invite him to come down again to stay with me one day. He will find me piping among my flocks and we will go around and see a few things;and then I can lend him a spare pipe and we can join in a lament together.

There are some benefits which those who live in rural areas would agree they enjoy—healthier conditions and a quieter life, for instance. What are the disadvantages? Notably, perhaps, they are disadvantages stemming from geographical remoteness, transportation, in some cases education and fewer public services because they have to be spread more thinly. A survey of the countryside today, I think, might be a little deceptive. On the whole, it looks tidy and well looked after and even prosperous;but, on closer inspection, it will emerge that many villages have completely changed their character over the past 35 years. No longer are they in any sense whatever self-sufficient. They may be dormitory appendages of the local town or city;their houses will have market values as second homes which put them completely out of reach of rural pockets;the employment of the residents, where they have employment, is usually no longer agricultural employment and young people no longer look for employment within their own villages.

Having said that, I believe that, socially, the gulf between town and country that we used to talk about so much 40 years ago is less wide than it was. The inhabitants have become more accustomed to one another and in one sense lead more the same kind of lives, perhaps brought together by such modern amenities as motor cars and television. The report suggests the desirability of a more comprehensive rural policy for Europe and outlines some of the cogent arguments in favour of that objective. Among others, the report makes a point interesting to me: that in many parts of Europe part-time farming is increasing. The report asks whether this development may make it easier to develop a comprehensive rural policy. That is certainly something I never thought about. One thing, however, that we ought to expect as, hopefully, a more comprehensive policy is developed to deal with the consequences of deprivation, is that, with the access of the new Member States to which my noble friend referred—Greece, Spain, Portugal, et cetera—with needs in this field more obvious than ours, there is likely to be more competition for funds. The share of the United Kingdom in the total allocated may be less. So, in pressing for a more comprehensive approach, unless the total available is increased, may secure no direct advantage. One answer to this may be that if the cost of the CAP is at present about three-quarters of the total EEC expenditure, there is room within that total for some reallocation. I believe, coming back to the United Kingdom, that there are areas here which are crying out for action.

I had the great pleasure not long ago of staying for a few days with my noble friend Lord Brookeborough, after he "cracked up "Fermanagh in your Lordships' House a little bit before. So off I went, and he took me round that beautiful county. As he will tell us later this evening, there are astonishing differences between one area and another in that extensive county. At present, my Lords, within the United Kingdom the work of the Development Commission is highly to be commended. It is admirable but its resources are limited. The main burden of helping with rural areas falls therefore on local authorities—the noble Baroness, Lady Stedman, implied that in what she said—particularly on the shoulders of county councils. Here again, the problem comes down to the question of resources, and rural services are a great deal more expensive per capita, for obvious reasons, than urban services.

A study was carried out, as my noble friend Lord Sandford, mentioned, in this past year, under the auspices of the Association of County Councils, called Rural Deprivation. It is quite a mine of information about what is happening, and the difficulties of extending it under present conditions. I hope that the present Government will resist the temptation to which its predecessor succumbed, to raid the grants available for other county councils because of the particular problems of the inner urban areas. The inner urban areas, we all know, have tremendous problems. I suggest it is a pity to reduce services very much required in rural areas because of that, if there is some way of avoiding it.

I hope from everything that has been said on the part of the present Government, that they have no intention of pursuing that line further. It is as always with government, a question of balance, and in assessing the balance in Europe and the United Kingdom it is right to be reminded, as this report reminds us, that the majority of people living in rural areas no longer earn their living directly in agriculture, though the productivity and prosperity of agriculture is of very great importance to them as the background of their lives in country areas. In what I say in no way do I want to imply that the increasing, efficient production of foodstuffs in this country ought to be stopped or discouraged. The two things can go perfectly satisfactorily together. I thought that this report struck a very moderate, reasonable and excellent balance between the various factors.

4.35 p.m.

Baroness ELLIOT of HARWOOD

My Lords, this report is excellent. The noble Lord, Lord Sandford, chaired the committee and although I may have one or two slight criticisms to make, on the whole I agree with every word that has been said by those who have spoken on the report. It is timely, since those of us who live in a rural area know how every day there are temptations for people to leave the rural areas and go into the towns, although at the moment possibly not quite so much because of a certain amount of unemployment. But in my area there is not much unemployment. It is something one continually has to look out for and hopes to be able to prevent.

The report points out that in the rural areas it is perfectly possible to have small industries, to have other interests and to enlist the support of other organisations. On the whole, we have done it fairly well in this country up to date because of the organisations which we all know very well. The Development Commission, the National Council for Social Service, the Scottish Council for Social Service, the women's institute movement, and many others, have all been pioneers in improving and making the rural communities more varied, to have more interests and attract more people to stay in those areas. I should like to congratulate those organisations and others because they are doing exactly what this report is suggesting might be done on a wider scale.

Whether or not that type of organisation goes on in Europe, I do not know. Probably there are some comparable organisations, in which case I am sure that they also do help. It is very good to be able to bring about a close cooperation between the variety of different interests that can and do come into the countryside. I live in one of the so-called least favoured areas—never a phrase I would like very much, because I think where I live is far nicer than anywhere else. When people talk about the Highlands or the hillside, the Borders, or Wales, the countryside of Wales or Cumbria, as being "less favoured ", it always gives me a slightly uncomfortable feeling because I think that they are more favoured than any other part of the world, if one likes living there, which many people do.

I realise that if one lives in such areas one must try to do everything to make life there attractive, not only to those who are engaged in farming but for those who are doing other things. I would say—perhaps it is not necessary because it has been said before—that the primary importance of those areas, as well as areas like the noble Baroness knows so well, the Fen areas, which are some of the richest in the country, the hill lands, Highlands and so on, are still making a very valuable contribution to agriculture. One must not look upon them as a paradise for tourists or anything like that. There is no reason why in the Lake District or the great and attractive parts in Wales and Scotland there should not be tourism;but tourism is not the most important thing. The most important thing is the growth of stock in the hills which then goes down to the country which has rich grazing and is turned into the sheep industry, the beef industry, and so on. Without the hill lands, without the areas where the animals are bred, there would not be great sheep or cattle industries or anything else. It is important to realise that.

In some way there have been conflicts in the past. I know that, certainly in Scotland, there has been a rather antagonistic feeling between the hill farmer and the tourist industry, because tourism can be harmful if people climb your hills, walk over your land and leave gates open so that sheep and cattle get mixed up and so on. One does not feel too friendly towards those happenings. However, the situation is improving because more and more people are beginning to understand that there are limitations in hill-climbing, walking or other sports when these are done in an area where sheep and cattle are being produced. In this connection, I support many of the recommendations in the report, and the way they have been put. I think that the evidence which has been collected from all the organisations is remarkable. There is not an organisation concerned with the countryside which has not put in a memorandum or contributed to the report, and I think the noble Lord, Lord Sandford, has done marvellously well to get so much information into one report.

There is one recommendation, however, which I would not support, and that is in paragraph 64, where there is a suggestion of diverting to what I would call nonagricultural aspects of rural areas money which is allocated for agriculture and for the development of agriculture. There is a suggestion of a transfer of existing CAP funds for expenditure directly related to agriculture: in other words, funds for crops, livestock production and other items of expenditure might be diverted to work of a non-agricultural nature. I do not think that is a good idea—I speak, of course, with a certain amount If feeling, since I am one of those who farm in the countryside! I think that money for that kind of thing should really come from the Social Fund or the Regional Fund of the EEC. What is intended for food production and intended to help agriculture obviously must come from the CAP and must go to those things. I am in favour of getting money from the Regional Fund or some other Funds for what we are talking about today, which is the development of other interests among a farming community. I certainly think we should do that. As we all know, we make huge contributions to the CAP. While we do get a lot of money back, we could get more, and I think a good deal of what is wanted here might come from other Funds of the EEC.

The other important matter is that when these three new countries come in we shall be getting an enormous increase in agricultural population. For example, in Greece, the agricultural population is 35.4 per cent. of the country;in Portugal is is 21.1 per cent.;in Spain it is 22 per cent. The figure for the Community of Nine as it exists now is 8.7 per cent., and if you take our agricultural population, it is only 2.75 per cent., I think. The importance of money being available for agriculture, certainly with the new countries coming in, is going to be very great. That is another reason why I do not think we should encourage the Community to divert CAP funds to other activities of the rural areas. I agree with everything that has been said about this document: it is extremely important, and I hope very much that it will make a big contribution to the policy of the EEC and to those who are conducting these affairs in Brussels.

4.45 p.m.

Lord PARRY

My Lords, as Chairman of the Wales Tourist Board and a member of the British. Tourist Authority, it is essential for me to make the usual disclaimer in terms of the Addison Rules and a bow in the direction of the noble Baroness, Lady Elliot of Harwood, who has just spoken. It is also a very great pleasure, and not a duty, to congratulate the noble Lord, Lord Sandford, and his committee, as other speakers have done, on the work which he modestly claims is making little more than a start. I think that we believe it has done much more than that. This report gives us the basis for some really hard thinking about an alternative economic development, which is essential. I put that in parenthesis at the beginning because there are some points I should like to isolate from the report as needing some further thought.

I would first turn your Lordships' attention to claims which the report makes, and makes fairly, that the rural areas are themselves areas of low income. It does not quite as well make the point that these areas of low income are in fact the country's areas of highest unemployment so that we have a coincidence, in what the noble Baroness has rightly called some of the most attractive areas of Great Britain, of two major weaknesses of the British economy—we have low income and high unemployment coinciding side by side.

Perhaps I may also point out what I consider to be an omission in the report: the current unemployment figures as at 10th January 1980 for Great Britain show an unemployment figure of 1,404,389, making 5.9 per cent. of the registered employable population, including school- leavers. I make that point simply to say that from there on you have a multiplier effect at work. I have made that point before in this House and I make it again now, because it is very often understated or not stated at all. In Wales, when you have in Great Britain an average unemployment figure of 5.9 per cent., the figures almost always show that doubled. At the moment the figure stands at 8.3 per cent. In Scotland it stands at 8.9 per cent. and in Northern Ireland, with its specific and desperate difficulties, it stands at 11.5 per cent.

I am not here making a political point but an economic one: in other words, the disposition of the economy of Britain works to the disfavour of the peripheral areas of Britain and therefore it is to those areas that we need to apply ourselves. That is why I welcome this report. That is not to be misunderstood as saying that I disregard the problems of the industrial or urban areas of Great Britain. I give them equal importance in my own mind. I only urge, as this report does, that the Government and others should give equal importance to the position of the rural areas.

The number employed in agriculture is crucial to the debate and perhaps to some of the statements that will follow during this debate. For example, in Wales in 1974 it was 52,483. That may surprise your Lordships: it surprised me. It was 51,949 in 1975, 56,088 in 1976 and 55,450 in 1977. I quote those figures in order to draw the attention of the House to the point that I wish to make: that in fact, while the Common Agricultural Policy, as has been rightly said in the report and in other speeches, has accelerated the rate at which people leave the land, there is nevertheless an upturn in the number of people employed on the land. In that connection I wish to say that that is because tourism is far more important than the noble Lords sometimes seem to imply. I want to say that in the Spey Valley in Scotland, for example, I recently heard at the Aviemore Conference on Local Government and Tourism a chief officer claim that tourism had all but wiped out unemployment in the Spey Valley and that the only people now unemployed there were people who were physically or mentally unemployable or who were temporarily out of work.

If we take that point, it emphasises a very important portion of the report. I am not going to go into the figures that the noble Lord, Lord Sandford, and his committee have quoted. I would, however, particularly draw your Lordships' attention to page xiii: The Directive's opening Article sets out its purpose—' to ensure the continuation of farming, thereby maintaining a minimum population level or conserving the countryside in certain less-favoured areas '. Since that statement is there, since the noble Lord, Lord Sandford, isolated it in his report and since he underlined it in his speech, is it necessary for anyone entering the debate subsequently to assume that one is attacking agriculture or farming? We take the point made in evidence, which can be found in the appendices to the report, that it is the aim of all of us to keep the farmer on the land. It is also our aim to see that, in being kept on the land, he is able to employ other people as farm workers and ancillaries to his industry.

As regards farm tourism in Wales—and I quote these figures because I have them at my fingertips—we have a list in the Wales Tourist Board of 1,200 farms which are not merely subsidised by tourism, but which are turning farming towards tourism as a way of conducting it as an authentic argicultural business, not as ancillary bacon and eggs pocket-money for the wife, but as an agricultural policy which takes into account the fact that our industrial heavy industry is decadent, that our urban economics—because they are dependent on them—are run down and that people want increasingly, anyway, to return to their roots;and the roots of all of us are in agriculture, whether we have been severed from them or whether we enjoy the pleasures of living or working on a farm. I would say to the noble Viscount, Lord Amory, who enjoyed his peregrinations around houses, that I should be happy to accompany him on such a run at any time.

The point then needs to be made that, …the Government consider the present level of aid to be adequate: and Article 10.2 (which provides for the payment of investment incentives for tourist or craft industry purposes) has not been applied because assistance is already available from the Tourist Boards and the Development Commission". Some reference has been made to that. It is absolutely important that I should make reference to it, in view of the fact that the Government are looking at expenditure on all statutory bodies' programmes. We have done very well in tourism. We believe we can claim it was understood by the last Government, and is understood by the present Government, that tourism is at least a basic tool of the economy. Nevertheless, the Government have a mandate for looking for certain cutbacks, and it would be a very bad move if any real spending capacity were cut from development for tourism purposes. In the rural areas, it is essential, where it is possible to fund alternative development of farm buildings, farming stock and farming programmes, in order to get a greater revenue from the attraction of tourism, that that money should be available.

We have an area called Section 4 in the Development of Tourism Act, which takes account of some of the expenditure. But when we measure it against the claims that are made upon it, we find that we can service only something like 28 per cent. of the demands. So there you see that the present machinery, regardless of politics, is inadequate and any addition to the finance available for this important development is essential to the economy of the country. I should like to draw your Lordships' attention to paragraph 30 on page xiv. I shall not read it out. All I want to say in that context is that in East Anglia there is a massively important rural area, rich in all the things that the noble Baroness rightly identified, and it has no aid at all because there is no industrial basis for it to draw that aid. So it is clear that the report is right and the policy is wrong.

We have had people talking about the richness of rural life. We have also had some mention of the difficulties of rural life: The Committee would not support any diminution of Community aid to urban areas". So there, again, the point has been made. We do not seek to detract from the amount of money available to the urban areas, and problems are especially acute for areas where a declining industry, such as shipbuilding or textiles, has been the major source of employment. I suggest that, far from being a peripheral point in the economy, far from being something that we regard as an interesting addition to our life, tourism and the development of the true resources of Britain, particularly the rural areas, is an alternative economy and should be treated in that serious vein. So I say Amen to the statement there.

I should like to agree with the noble Lord, Lord Mackie of Benshie, who pointed out that transport is very important. I should like to go further and say that it is crucial, because today there is very real hardship, often quite unrelated to income and position in society, for people who live in the rural areas of the country and who have seen the dismantling of services that has gone on in the last 50 years. I have picked up old-age pensioners in my car and carried them to their local surgery, where they were going to have their prescriptions filled. They have said to me, "Gordon, it was easier to get from Dale to Milford Haven during the Boer War than it is in 1980".

It is a fact that the young housewife, the young girl who chooses to live in some spot of great importance to her and her husband, can find herself, as her husband is promoted, becoming increasingly cut off and living in a kind of genteel poverty, because there are no services—they perhaps have not reached the stage of the second car—and she is held by small babies. So we have a very real interference with the quality of rural life. In fact, it is deteriorating and we should note it and emphasise it and bring it to the attention of the EEC.

May I in that connection say that we have not given enough thought to the multiple use of services which already exist? We create at great cost, under separate institutions, things which are of great value to people and then we use them exclusively. This country, under any Government, can never in the future create that kind of resource and use it part of the time. I always wondered why it was that the rural postal vans could not be used as postal buses as they now are, and I was happy to be a part of that initial experiment. I would extend that to service transport. I would extend it to the use by aircraft of service runways. I would extend it to the use of schools in the rural areas which have tarmacadarned areas and very good services, but which are closed during the peak periods of the holidays.

Of course, the noble Baroness was right when she talked about the nuisance of tourism. Who would be silly enough to argue that one does not like a deserted beach better than an overcrowded beach? She was indentifying properly one of the problems of the management of tourism, and it seems to me that we are not being fair to the economics of this country, nor to ourselves, if we allow valuable resources to lie under-used in the rural villages of Britain and do not press them into service to relieve the pressures that tourism creates, when we know that tourism is fundamental.

I realise that time passes quickly and I should like to thank the noble Lord, Lord Sandford, for avoiding a patronising attitude towards tourism in what he had to say. He and I agree that he, in no sense, under-estimates its value or its importance. But I cannot too heavily underline the fact that I believe it is not fully yet understood that this country is passing into a service-based economy, that its heavy industrial period has altered beyond all recognition, and that, therefore we must in future look to the identification of the positive in the service industries;and tourism is among them. I would say with the greatest possible affection to the noble Baroness, Lady Elliot of Harwood, that the only point on which I disagree with her is that it is the most important thing, whereas she does not take it to be. I am an evangelist, at this stage Tourism is not an ancillary, it is not simply a prop;it is a basic industry in its own right. The sooner we realise that and build it into our future programmes for heavy industry, high technology industry and agriculture, the quicker we shall come realistically to grips with our own problems.

Tourism employs 1,500,000 people in the United Kingdom today—a nice little relationship to that unemployment figure. Last year it recouped £3,500 million of foreign exchange;so it is important and it must be seen as important. And its place is in the rural areas and along the coastal resorts as much as in the overcrowded and overpriced streets of London Town.

The national parks are themselves contributory to part of the difficulty of planning in the rural areas. That is why I welcome so much the positive emphasis of the evidence given to Lord Sandford by the national parks in general and by my own Snowdonia National Park in particular, which is one of three we have. Young people in the rural areas come up against a plethora of bodies which have responsibilty for planning, and their own life style is often affected by decisions taken by bodies to which they have very difficult access. So I particularly welcome the evidence that the Community's approach should be more comprehensive in scope and should not concentrate merely on agriculture.

May I draw finally attention to the fact that 25 years ago the Mid-Wales Investigation Report pointed out the development of some of these problems when it recorded the falling-in of so many agricultural holdings. Had those agricultural holdings not fallen in, there would be today available to whatever Government of whatever colour of this nation a tourism stock, a basic industrial stock which would have been equal in value to the factory stock which we are trying desperately to keep going in order to keep our people at work. So there is perhaps too optimistic a statement in that paragraph.

I should also like to say one word about the evolution of tourism in using the countryside as a theme park. If I may come to the four objectives of the report, I should like to say that objective (b) is very close to me. Objective (c) is equally important but objective (d)—that we should provide all practicable access and facilities to the public for tourism, recreation and sport;that is, the leisure industry—is basic to whatever you wish to do. I am glad that the submissions of the Wales Tourist Board, the Scottish Tourist Board and of all the other bodies were included in this report.

I made a disclaimer at the beginning of my speech and I make one again at the end. I am not an enthusiastic supporter of the European Economic Community. I fought it tooth and nail from the time that I was a boy and I still am unconvinced that it is the great boon that its adherents believe it to be. I believe the contrary. But here today in this House I welcome the initiative of the European Economic Community, I congratulate Lord Sandford, and I hope that he is as successful as the tourism industry is at this moment.

5.3 p.m.

Viscount BROOKEBOROUGH

My Lords, I should like to start by congratulating my noble friend Lord Sandford for his presentation of the report. I know the tremendous trouble he has taken over travelling across Europe to find out what are the policies for rural areas in other countries. It is an advantage to me to be speaking so far down the list in today's debate;so much has already been said that it leaves me with a lot of blue pencil lines through what I was going to say. I support practically everything that has been said. I support in particular what was said by the noble Lord, Lord Mackie of Benshie, about the extension of these experiments in the Western Isles to the Highland areas. I should like there to be an extension of that sort of principle to larger areas in my own country of Northern Ireland.

When I read these reports I am always absolutely staggered by the way in which the staff of these committees collect together the vast amount of evidence and present it in such an incredibly readable and intelligent way. I feel that this House should never cease to record its gratitude to the staff for their very hard work and for the long hours that they put in.

May I support the noble Baroness, Lady Elliot of Harwood, in her plea that the money given to other industries, such as tourism, to maintain the rural community should come not from agriculture but from other parts of the Community. In Northern Ireland, we have a greater interest in agriculture than have the people of Great Britain. Agriculture is more important to us by a multiple of about four. Therefore, this debate and report on policies for rural areas in the EEC is especially important. Because we are such a small area we sometimes feel a little bit swamped by the way in which these reports are dealt with and by the way, possibly, the United Kingdom deals with the EEC in relation to our rather smaller area. However, we do agree that there should be a comprehensive policy for the rural areas. That, surely, is the main theme of this debate. There should be a comprehensive policy for the maintenance of rural life in our country.

As I have said, the maintenance of a rural policy should not fall solely on the CAP. In fact, a large proportion of it should come from national resources, and it must certainly be administered nationally. There has been a lot of publicity of late about our fight to reduce the net effect of our contribution to the EEC—that is, the net deficit that the United Kingdom should get back from the EEC. I believe that when the Government finally end their negotiations on the present EEC proposals they will find that one of the ways of recouping our contribution will be by the extension of special support for the rural policy.

In particular, may I refer to an experiment, the details of which I have here. It comes from the Irish Republic. I would describe it as "hire purchase forestry." It is being sponsored by an EEC operation in the West of Ireland. In my opinion, our Government should look very quickly at that EEC experiment in the West of Ireland to see whether or not we can learn from it and experiment now so that when the time comes to implement the policy we shall already have a basis upon which to build.

The principle of this scheme is that the forestry service will go to a farmer—the particular cases involved which I am thinking about are in Leitrim and Sligo;the land there is of very high quality;it goes up to yield class 25 which is the very highest yield class of forestry land—and say to him, "Will you take your land out of forestry for 35 or 40 years? We will plant it for you and then pay you an annuity based on the final crop value. For that you will manage that bit of forestry during the years of maturity." They have worked out figures which show that, in various areas, by taking a particular farmer out of milk production the net return to that particular farmer will be very close to what it is for milk production.

Tremendous emphasis is placed upon taking farmers out of milk production, which is in surplus, and trying to convince them that they should go into beef production. However, our experience of going into beef production is that automatically it means a lower standard of living because it is not so profitable an industry as milk production. If this experiment could be tried it would maintain the income of these particular areas. It would produce a product which is in deficit. One reads almost every day the projections about the great wood shortage. I believe that we would have a viable alternative and a really stable community, because forestry develops saw milling and the other industries. So in hoping that this report will have some effect on Her Majesty's Government, I should like to ask them urgently to look at this particular scheme.

The Earl of CAITHNESS

My Lords, we are most grateful to my noble friend Land Sandford for the work that he did as chairman of "Arcadia "and for bringing these two very important matters to your Lordships' attention today. It is difficult to isolate them, and therefore I have found it necessary to take into consideration on an EEC level the Select Committee's report on the Common Agricultural Policy and to go back on a national level to the Strutt Report Agriculture and the Countryside and the Government's publications. They are all part of an interlocking puzzle which I call "rural land".

However, first I should like to go back to the 1942 Report on the Committee on Land Utilisation in Rural Areas—a Committee chaired by Lord Justice Scott—and to quote from paragraph 14, because the report sums up very concisely what I want to say: The landscape of England and Wales is a striking example of the interdependence between the satisfaction of man's material wants and the creation of beauty. The pattern and the beauty of the countryside as we know them today are largely the work of man during the past few centuries …If land were left uncultivated, if downs and mountains were not grazed by cattle or sheep, the countryside would gradually but inevitably return to its former natural condition of forest in the valleys and on the lower slopes, and a scrub of brambles, thorn bushes and bracken on the higher levels". I trust the House will agree that it would not be inappropriate to change the words "England and Wales" to "the EEC".

Part of the ever increasing cost of the CAP (if I may be permitted to use verbal shorthand) is the maintenance by subsidies of farmers on marginal land or in less favoured areas. This is, of course, of tremendous importance but it is a social and agricultural problem. It is evident that the cost of the EEC budget will soon outstrip the income it generates and as farmers will be the first to suffer so this will affect rural areas. There is therefore a pressing need to do something to secure these rural areas and reduce their dependence on agriculture.

Professor Dennison in his minority report to the Scott Report in 1942 saw the need then for an integrated approach and therefore the initiative of integrated development programmes for the Western Isles of Scotland, the Lozère in the Massif-Central, and South-Eastern Belgium are to be welcomed and supported. If it is possible to make these schemes work—and I believe it is, with encouragement—then by using agriculture as a base the local economy, which has been contracting, could start to expand in a variety of ways. Part-time farming has been common for many years in these areas and this EEC proposal could inject a level of financial and other resources hitherto too meagre to provide the necessary launching pad to extend the concept of occupational pluralism.

Alas! we come back to finance, but as the committee has shown a slight change in emphasis in the CAP so that rural areas benefit more from it, this, backed by a more flexible approach by the managers of the European Regional Development Fund and the Social Fund, together with greater inter-departmental co-ordination, could generate some of the funds needed to fulfil the purposes of these schemes. Are we asking too much? To those who say, "Yes "I would ask them to contemplate the horrible alternative if nothing is done to stop the decline in rural areas.

The three schemes put forward are only a start—the tip of the iceberg—and it is necessary for the EEC and each country to consider further areas which are in the same plight. I am sure the House will agree that, with the accession of Spain, Greece and Portugal the necessity for the integrated approach will become even more acute.

We should be wrong to rely on the EEC alone to solve all our problems in this field and national Governments must play their part in encouraging this process. The Committee have given examples of the upland management experiments in Annex II of the report, and I should like to mention another scheme, albeit much smaller and one relating to industry, in which I was actively involved for some years and which was carried out with private finance but which could have been a scheme where EEC or national support might be forthcoming.

Briefly, it is as follows. The area is in the Cotswolds near a village called Blockley, close to Moreton-in-Marsh. One might initially think that this is not a "deprived area "or one needing special attention, but when analysing local population trends and places of work we received some depressing statistics. Nearly everyone commuted to work by car or train and the population was centralising itself in one or two villages.

On one of the estates that i helped to manage at the time there was a former war-time American hospital which later became a Polish refugee camp. It comprises about 40 acres in the former park to the house, on which were built huts of various sizes up to about 3,500 square feet. In 1970, when the Government returned it to the owner, about one-third of the buildings were converted into a dairy for the home farm. The rest was scheduled for demolition and returned to agriculture. All services were there, the buildings could be refurbished and we believed that they would make good light industrial units. The planners believed otherwise. With the help of the Council for Small Industries in Rural Areas we persevered with the planners and I understand that the disagreements—if that is the right word—are still progressing but we eventually obtained light industrial consent on part. There are now on site metal spinners, a printing works, welders, a plastic model design manufacturer, timber frame building specialists, a fibre glass product manufacturer, a fibre glass boat builder—who incidentally exports 90 per cent. of his boats—and two silkscreen printers, one printing on metal, the other on cloth.

I should like to extol some of the virtues of this site. It has put employment within bicyling range of the local villagers instead of the necessity to go by car. It has stimulated the local economy. It has helped the infrastructure of the area by offering opportunities to young people to stay in the villages. It has enabled one or two man bands to start up at rentals they can afford and in non-industrial estate type buildings which they seem to prefer. It has also buried the myth that light industry in a rural setting will not work or is unacceptable.

The planning principles it raises are important. There must be much greater flexibility in the minds of planners and greater liaison between countries where such a scheme is on the boundaries of two councils. During the committee's visit to Brussels it was suggested that it was up to each country to put forward schemes of its own. There is, therefore, a need for a small, central entrepreneurial body that can advise on such schemes and other matters of integration and to put forward such propositions if they fulfil the requirements for some financial aid. I have mentioned one, but there must be many more possibilities in this country, smaller or larger than the one I have mentioned.

There are many more aspects of these reports on which I should like to comment but time does not permit it. I hope that the EEC integrated proposals will be approved and will work well, and that both this Government and the EEC note and take action on the points the committee raised. I believe that they have extra weight because those who sat on the committee really do care for the wellbeing of the rural community. I started with the Scott Report of 1942 and it is perhaps fair to finish with it as times appear not to change very much. The words I have in mind are: As a nation …our great failures, both in war and in peace, have been due to a failure to think ahead and to make plans in advance". My Lords, it is up to this Government and all of us to see that my children do not turn round to me in a few years' time and say, "You saw the problems, you prepared a report, but what did you do about it? "

5.19 p.m.

Lord HENLEY

My Lords, I rise this afternoon to make two brief points. First, I wish to draw your Lordships' attention to an excellent booklet entitledCountry Workshops;Decay or Development? which has been issued under the auspices of the Somerset Small Industries Committee and is the work of Mr. David Pattern, who is the local Council for Small Industries in Rural Areas organiser and who covers that area of Somerset. It is a very small book, merely a dozen or so pages, with quite a number of photographs, and deals simply with ideas for new uses for old buildings in villages with a view to creating more rural employment. I do not think I need say anything about the desirability of creating more rural employment because it has been dealt with by a great many speakers this afternoon and it is accepted that it is essential to stimulate some rural industry so that the villages do not become mere dormitories for urban workers in nearby large towns or, worse still, if further away, mere ghosts when most of the houses have become what are now termed "second homes".

In his booklet Mr. Pattern is simply advocating that those derelict buildings which are found quite often in the countryside, such as old railway stations, churches, chapels and, in my opinion, more important, superfluous agricultural buildings, can be put to new uses which can alleviate the problems of rural unemployment. I mention this booklet only so as to recommend it to your Lordships, and to say that should any noble Lord wish to see a copy I can no doubt obtain some more. It mentions in passing the problem to which my noble friend Lord Caithness referred, the effect of planning and highway considerations on development. I do not think I need say anything more, because I think my noble friend Lord Caithness knows far more about this, other than to put in a plea that the planning authorities think much more creatively about this.

I think one of the problems is user classes, which would cause some small workshop in an old agricultural building to he termed "light industrial". If one hears the words "light industrial "one has pictures of dark satanic mills and so on, which quite obviously need not be the case. The small craft workshop will be no more a blight on the countryside than an efficient working farm;in fact, it would probably create far less traffic. Think of the traffic a dairy farm creates, in terms of at least one tanker a day, as well as other lorries arriving with feedstuiffs. I do not think the highway problem need arise.

That really leaves me nothing else to say except how much I am in agreement with the noble Baroness, Lady Elliot, and in slight disagreement with the noble Lord, Lord Parry, in asking for slightly less stress on tourism. I know it can create a lot of money, but with oil and petrol prices going up I am not sure that it can be guaranteed to continue to provide a valuable really long-term contribution to the rural economy. I should like to end by expressing my appreciation of the work of such bodies as CoSIRA and the Development Commission, congratulating the Select Committee on this excellent report, which has been aptly called "Arcadian ", and agreeing with all those who have said how eminently readable and sensible it is.

5.23 p.m.

Lord INGLEWOOD

My Lords, I must first apologise for not putting my name down until so late in the day. I live in the area of the Eden District Council if not in the area of the East Fellside experiment, so I am to some extent one of the natives about whom this report has been written;and an excellent report it is, and very timely. I was also once Member of Parliament for Westmorland and therefore in contact with Umex 1, 2 and 3, which are also familiar to the noble Lord, Lord Peart, who was a constituency neighbour. We both know the area which has been chosen, and I think it is a very good area for these experiments.

Further, I am president of the Cumbria Tourist Board and I should like to confirm what was said a few minutes ago about Wales and say what a big contribution the tourist industry can make in these areas. But it goes far beyond bleak promotion and it is wrong to test everything by figures. We often see summaries of tourism figures in the daily Press, but I do not think they tell us the whole story. We must go beyond that.

This problem which we arc studying today has been very clear over the past few years, tending to get worse over the past 40 or 50 years when small industries were closing down and population was being drawn more and more into the larger towns—possibly because private transport is now so widespread, but there are other reasons too. About 100 to 150 years ago in these areas small industries were scattered right throughout so offering a much wider choice of employment. The managers of the big estates then existing gave a lot of attention to this, if only because it put up the value of the property for which they were responsible. But today few are big enough to achieve very much. So we must all think again and this report is an example of excellent thinking and hard work in this sphere.

I am not too depressed. Westmorland, the county I represented in the House of Commons for years, was looked on by people who came from the South as an area were the inhabitants were to be pitied: I never quite know why. I looked on Westmorland as a part of England which had much in common with Switzerland, and nobody is going to say that Switzerland is the poorest part of Europe. Perhaps the only advantage that Switzerland has over Westmorland is that it has tax concessions.

My last point is purely an historic one but is rather amusing, and I hope the noble Baroness, Lady Elliot, will forgive me. Whereas Westmorland was rich in rural industries, which sad to say are now nearly all in ruins, it was the south of the county where they were found spread more densely than in the north. That was partly owing to the more reliable water power, but also it was further away from the Scottish border and further away from the risks of kidnapping and terrorism which existed then just as in other parts of Europe they exist today.

5.26 p.m.

Lord PEART

My Lords, may I first congratulate the noble Lord, Lord Sandford, on the way in which he introduced this most interesting report, which I know most noble Lords now in the House must have read carefully, judging by the quality of their speeches—and that is not flattery. I was one of Lord Inglewood's constituents or he was one of mine. The Vane family have always taken a great interest in agriculture in Cumbria, but above all a great interest in forestry, and I thought the noble Lord was going to intervene on that subject.

Lord INGLEWOOD

My Lords, if the noble Lord will allow me, will he not also mention that we have a very good inn and that he himself has patronised it on a number of occasions?

Lord PEART

Yes, my Lords, it was in my constituency—the Pheasant Inn. If the noble Lord Viscount, Lord Amory, wants to do a tour he can come North and the noble Lord, Lord Inglewood, and I will take him to the Pheasant. This is one of the rural amenities that I always like and which I consider essential to country life. The noble Lord, Lord Inglewood, is not only a farmer and a forester but also an innkeeper.

Let me come now to what the noble Lord, Lord Sandford, said. He mentioned the need to have an integrated community, the need to integrate agriculture, forestry and the social needs of the area. I thought he was a little anti-farmer in some ways;perhaps I am wrong. I think the noble Lord, Lord Mackie, sensed that and that was why he made the apt reply that he did. The noble Lord, Lord Sandford, went on to talk about the problems of the EEC. I know they have got their problems. I was once a critic of the EEC and a very strong critic, because I was always afraid that acceptance of the EEC would mean the end of a policy I had supported for a long time, the 1947 Act, assured markets, guaranteed prices, the sort of legislation which I thought did so much not only for farming but also for rural England.

Good farm policy is good for the area, not just the farmers. I think that point was made by the noble Baroness, Lady Elliot, whose domain I was pleased to see not very long ago when I was in Scotland addressing the Border area of the National Farmers Union. What a lovely place! I should like to go there and be welcomed back, but I am not a socialite in that sense. I should like to see better weather for the farming which I know is so good there.

I would only say to the noble Lord, Lord Sandford, that I do not think he can really fault the EEC. After all, they have produced very good reports on this matter. Indeed, when I used to go there as the spokesman for the Government it was always one of my great concerns to press the need to have an integrated policy. I always thought that somehow they neglected forestry. I believe that forestry has so much to offer. I do not see forestry as a competitor with general farming in the hill and upland areas or indeed as clashing with tourism. Indeed, my view is rather the contrary.

The noble Lord, Lord Inglewood, has spoken about his area of Westmorland, which is now in Cumbria, and likened it to Switzerland. It is like Switzerland—it is called "the little Switzerland". Anyone who goes to the Lake District and experiences, all its beauties and then goes to Switzerland, will realise that there is much to be said for that comparison. It is a great upland area which has benefited so much.

As regards my own old constituency, the 27th Report shows the Upland Management Experiments which are taking place now in the Lake District. They were first established in the Lake District in 1969 in an attempt, to deal with the conflicting purposes of landscape conservation, public access, farming and the economic and social wellbeing of local people in areas of the National Parks". It then goes on in great detail to say how important it is that, farmers and self-employed workers living in the dale heads where problems of economic decline [are serious] and lack of employment are endemic were paid to mend stiles, drain footpaths, build bridges, repair walls and maintain other features of the landscape. They repaired visitors' damage, re-routed footpaths and so on. There is another report for the same area.

I am making the point that there are many factors in the community life in the rural areas, and I would not like to see again the battle of forestry versus farming;sheep versus trees and so on. That is silly. I believe that there should be proper integration in areas where it is necessary. On the other hand, the farming community in rural areas may be in areas where it is essential to have crop farming. That point is well known by the noble Baroness, Lady Elliot of Harwood, who in her own area has animal farming which is so successful.

There must be the right balance. I hope that there will not be any attitude of "anti-farmer". Even in the Lakeland it is the farmer who protects the hedges and often does so much to improve the amenities for the tourists to enjoy. I am glad to say that Cumbria is now developing tourism in a very forceful, aggressive and good way, showing the people of England and Wales, through advertisig, that it is a lovely spot which should attract tourists and that tourists should see the Lakeland before they go abroad. So I am very proud to have connections with that area, just as I know my noble friend Lord Parry, who made a very eloquent speech, is proud of Wales and my noble friend Lady Stedman is proud of the Fenland and Cambridgeshire and what tourism can give to those areas and how those areas can expand. In the end, in the rural areas, it basically comes down to the farming community.

I remember that when I heard the noble Lord, Lord Sandford, talk of his Arcadia, I thought of a period when I was chairman of a commission in the Council of Europe. The commission comprised different nationalities. We visited Greece, which the noble Lord mentioned. I can assure him that it is all very well to have the type of life that he envisaged there, but what the Greek farmers wanted was help and aid for good farming, for improving irrigation, for improving stock by better feeding and for the growth of machinery. Indeed, I was surprised to see the development of artificial insemination. In fact, the first experiment that I ever saw was in that country and not in my own. Tom Williams, behind whom I used to sit, was the Minister who introduced the Bill to make that possible.

All that I am trying to say to the noble Lord is that rural development depends basically on the farming industry in a particular area. I continued my surveys with that commission in not only Greece, but later Italy which I knew much better because I was stationed there for a long time in the Army during the last war. There again it was the farming community that was the strength of the local community. I am not saying that other industries are unimportant. After all, agriculture provides many other ancillary industries—for example, the supplies needed for the industry itself. Therefore, I hope that there will not be this "anti-farmer "attitude in anything that comes out of the Community.

Again, do not let us condemn the Common Agriculture Policy. Its aims are very similar to those of the Agriculture Act 1947—and I direct that remark to the noble Lord, Lord Parry. I could quote it, but all that I am trying to say is that they have their problems. Of course, they have surpluses, and I should like to see them export those surpluses. They talk about a mountain of butter, but what is the mountain? My friends in the Lake District will know. Is it as big as Skiddaw? I do not think that it is. I think that it is only about two days' supply. So, we must be sensible.

Too much is made about the CAP creating surpluses. The worry has been about where we have been directing those surpluses. Indeed, there was a Question the other day complaining about selling surplus butter to the Soviet Union. I believe that a French millionaire has the tender and does the trade but that is his business. All I am saying is that if there are surpluses, we should export them or give them for aid in those areas that need them. After all, the United States has great surpluses and relies on getting rid of its surpluses of wheat throughout the world, and even in our own country. Do not let us have any critisicm of the CAP as regards this matter.

We are now thinking in terms of integration, in terms of the need to attract industry into the rural areas. I am only sorry that one of the schemes which I initiated when I was a Minister fell through. I am referring to the Pennine Rural Development Scheme. I know that the noble Lord, Lord Inglewood, probably did not approve of it in the way that I did, but I can assure him that many of his colleagues in the CLA and the National Farmers Union wished that that scheme had been successful. I set it up and I appointed a very distinguished farmer, a member of the National Farmers Union, as the first chairman. It prepared the way for developments which I thought would be good for the industry, developments which would encourage not only farming, but road development, more electrification of the area and also more tourism, which we now have. What happened? We were defeated and I went out as Minister for Agriculture—as I once said in this House—at a stroke. Mr. Heath and Mr. Prior destroyed it, and many people regret that.

I also set up a similar scheme in mid-Wales. I am sorry to say that it became ground down in Welsh nationalism, so really they did not deserve it. However, the rural development scheme in Cumberland would have been a success and that is the type of pattern which I still think should operate as regards our approach in that area.

I should like to praise those organisations outside Government—and even outside local government—that have done so much for the rural areas. I have here a document from the Development Commission encouraging enterprise in the countryside, which I think has been quoted previously. I wish to pay a tribute to the chairman, the noble Lord, Lord Northfield. Lord Northfield was a member of the committee which also examined the European document and he has done so much as regards the creation of new industries in rural areas. I am sorry that he is not present today, and he has asked me to apologise for his absence. We, and the Community generally, owe him a great deal.

His report recommends integrated rural revival plans with experiments, including those already started by the Commission beforehand, in those regions which are suffering from decline—in other words, depopulation, which has been mentioned in many areas;bad age structure;high unemployment and absence of alternative work. That, of course, is exactly what the Development Commission was set up to do. I hope that noble Lords who have read the European report will also now read the document, Encouraging Enterprise in the Countryside, which is published by the Development Commission in its 37th Annual Report for 1978–79.

Therefore, speaking from the Front Bench, I recommend the Commission's work which is so strongly supported on all sides of the House. It operates in three broad ways. They have approved a programme of nearly 1,000 small workshops and factories in key points in all declining rural areas of England, and the programme is a partnership in operation with the local authorities, who assess their own requirements and show us what self-help they will provide. Secondly, they have a subsidiary, the Council for Small Industries in Rural AreasCoSIRAs—which, with a staff of only 300 mainly outposted to the counties, and with advisory committees of businessmen in each country, advises, guides and gives expert management and other training to small businessmen, as well as offering loans. I understand that having lent over 30 million, they have lost only just over £70,000 which is a pretty good record.

Thirdly, the Commission supports rural community councils which, in turn, organise self-help activity in order to enliven and support social life and to cure social needs in the rural areas. Therefore, there are these three elements or prongs which will provide aid to the areas which we have mentioned. In the past five years the commission has built up its present strength;for example, five years ago virtually no factories were approved. The Government have commissioned, and have just received, a report by civil servants on the future of the organisation. I have not seen this document, but I hope that help will be given from central Government. I know that in recent years the previous Labour Government more or less trebled the budget. At Government level we appreciated what was being done. I hope that the present Government will carry on with this work. We shall press the Government to produce the report, to institute a review and to make a Statement on it.

By this debate in this House we can show that we are examining what the Community have offered and what it is doing;and we can link with that the aid which is given by bodies from central Government. I believe that we have had a well worthwhile debate. I have cut my remarks to only 16 minutes. We had a very long debate last night, which went on until nearly midnight. This has been a short, concise debate and it has been all the better for it.

5.43 p.m.

Lord MOWBRAY and STOURTON

My Lords, I welcome the raising by my noble friend Lord Sandford of the important issues covered in the report of his sub-committee and of the report on farm structures, which we are also debating. I should like to congratulate him on having set afoot such a very good discussion as we have had, especially with contributions from noble Lords such as the noble Lord, Lord Peart, who was one of the most popular Ministers of Agriculture this country has ever had and who has more knowledge than most of us.

With your Lordships' permission, I shall concentrate at first on the former report, which concerns policies for rural areas in the European Community. It is now just a year since we last debated the problems of rural areas in this House in the Motion on rural deprivation tabled by the noble Lord, Lord Walston. That dealt, of course, with these problems in a national context;today's debate goes wider and takes in the European Community dimension. I think that the House will agree with me that we owe my noble friend Lord Sandford and his colleagues an immense debt for their pioneering work in what, to all intents and purposes, is a new and untrodden field. I should also like to pay tribute to the thoughtful and wide-ranging speech made by the noble Lord when he spoke earlier this afternoon, and I should like to give him an assurance that we shall take most careful note of the various points he has identified for consideration.

The report of the sub-committee draws atttention to social and economc changes over the years in the countryside, which have altered the balance of employment opportunities and the social and demographic structure of rural communities. We all know the factors which have contributed to this process. Principal among them is the increased productivity of modern agriculture, and the consequent decline in the workforce. As the noble Lord, Lord Mackie of Benshie, said, "there are not the folk on the farm "these days. With the absence of adequate alternative local employment, people have had increasingly to migrate to the towns to find work, and added to this has been a process of overall centralisation of services, in both the public and the private sector. All of this has led to what I think are termed, in the jargon of the sociologist, "knock-on "effects. For instance—and the noble Baroness Lady Stedman, drew attention to this because she was very worried about it, and so did several other Peers—a decline in rural jobs leads to migration of active people to the towns;such migration weakens the economic basis of village services—shops, transport, schools and, of course, sub-post offices, that centre of village life. There is a loss of facilities and, to some extent, of community spirit;this, in turn, leads to further loss of population. It is a vicious spiral and one which is difficult to arrest.

As several noble Lords have described, the effect has been the phenomenon now widely termed "rural deprivation". As the sub-committee of my noble friend Lord Sandford has noted, the extent and nature of this process in the United Kingdom is well-documented. For instance, in the last 18 months comprehensive reports have been produced on the subject first, by the Association of District Councils and, subsequently, by the Association of County Councils. These reports and others like them, have been most helpful in highlighting the problems, which are not, of course, unique to this country. Again, the noble Lord, Lord Sandford, has made that clear. But we face them with some severity, partly—and also ironically—for the reason I have just given: as a result of our high rate of agricultural efficiency. I want to emphasise that the Government fully recognise these problems and will do all they can to maintain the economic and social wellbeing of the countryside within, of course, the present constraints of finance and other resources.

The noble Lord, Lord Mackie highlighted the task and said that it was good sense to tackle and harness the national assets of the countryside, such as tourism, which, as he pointed out, would lead to economic renewal. The noble Lord, Lord Parry, speaking from his experience of the Welsh Tourist Board, also emphasised the importance of tourism. Like the noble Lord, Lord Peart, I too congratulate my noble friend Lord Inglewood on running a good inn, in The Pheasant.

I should just add that my colleague, the Minister for Local Government and Environmental Services, shortly expects to meet the chairman of the two local authority associations to discuss the reports to which I have already referred, and the views that have been expressed. Naturally we are already giving these most careful consideration.

My noble friend Lord Sandford, and his colleagues make the point that the diversity of rural areas emphasises the need for flexibility in all policies which affect the countryside". I am sure that there is no one rash enough to disagree with that. I am also certain that it has now been widely recognised that it is an over-simplification to refer to the "problem "of rural areas, as was once the fashion. There is on one single problem;there is no one single type of area;instead there is a whole range of rural areas, each with its specific characteristics and experiencing its own blend of problems I should like to join the noble Lord, Lord Parry, in saying to my noble friend Lord Amory, that I, too, should like to savour the problems of Devonshire, and take up the invitation which he specifically issued to the noble Lord, Lord Sandford, and the noble Baroness, Lady Stedman.

Viscount AMORY

My Lords, I should like a little warning of numbers. If necessary I will hire a coach—I should be perfectly prepared to do that at the right moment. As for the "Vane Inn ", I am a little confused;I have an idea that if I ask for that, I shall ask in vain!

Lord PEART

My Lords, I hope that the noble Lords will be careful. I once was invited to the noble Lord's residence and he took me to the Devon Show, and I had the biggest protest meeting of farmers I have ever had in my life!

Lord MOWBRAY and STOURTON

My Lords, the last time I went to the Devon Show the noble Lord, Lord Clifford of Chudleigh, was crowning the Dairy Queen from New Zealand, so I have happy memories of it. Dealing again with the problems we are talking about, at one end of the spectrum we have the more remote parts of the Countryside—notably in the uplands—where there are few countervailing influences working to stem a steady trend of depopulation. In England, this is perhaps best exemplified by the North Pennines which show ed a decline of more than 20 per cent. in population between 1951 and 1971. We shall, of course, have to await the results of the next 1981 Census before any more up-to-date figures are available.

Then there are village communities which have become popular for retirement, or for weekend homes, or both. Here, although the active workforce has declined, the total population may have stabilised. Parts of South-West England clearly fall in this category. Thirdly, there are those rural areas lying nearer to our conurbations which have largely become, in effect, commuter dormitories. These have suffered, and I use the word advisedly, from the increases in the cost of housing in our towns, particularly over the past 10 years. People earning relatively high wages have looked further afield for their homes with consequent effects on village house values and, sadly, the pricing-out of young local couples. Again there is probably no net depopulation occurring—in fact overall there may even be small increases in the size of villages. But, because this is achieved by an influx of newcomers, these types of area too are affected by basic social change. People who earn their livelihood elsewhere often do not integrate satisfactorily for some years with those whose families have been born and bred in the village for generations.

My Lords, I now turn to the European Community aspects of these issues;and perhaps first I might comment on the implications for spending patterns of enlargement of the Community, a matter to which reference is made in paragraph 14 of Lord Sandford's report. This states that such enlargement will involve demands for a shift in Community aid towards the southern half of the Community and towards rural areas. My Lords, in terms at least of agricultural expenditure this needs, I think, some qualification. The noble Lord, Lord Sandford, called this his Arcadian point, and I thought that the noble Lord, Lord Peart, talked so wisely and sensibly about the Greek element of this.

There will naturally be increased expenditure by the Community on Mediterranean produce—such as wine and olive oil. But it is not a foregone conclusion that the Community's agricultural spending will shift very dramatically or rapidly to the South. I hope that this will reassure my noble friend Lord Amory, who also expressed anxiety on this point. There will be a transition stage of some years, and you cannot, for example, store fresh fruit and vegetables in the same way as butter, beef or wheat. Full scale intervention in the traditional sense just is not possible for some Mediterranean produce. The United Kingdom has also consistently resisted firmer protection or price guarantees for Mediterranean produce. It will be some time before the new Member States will be able fully to apply the existing structural directives. Any new programme for improving agriculture structures would have to be shown to be cost-effective before we could agree to it.

Even so, it is clearly salutary at this time to look in detail, as Lord Sandford and his colleagues have done, at the nature of Community policies for rural areas. His sub-committee have considered a range of options to develop. For instance, they propose that the Community's less favoured areas directive could provide the United Kingdom with "a framework for improved policies".

My Lords, this directive is, of course, designed to ensure, in its own words, the continuation of farming, thereby maintaining a minimum population level or conserving the countryside in certain less-favoured areas". As the committee recognise, the United Kingdom is the major beneficiary under the directive. The few measures not implemented by us would involve very limited aids to investment to a small sector of farms. They would be payable to farmers in respect of improvements and operations on their farms;and, of course, could only bring indirect benefit to the rest of the rural communities. In short, I think scope for further action under, or based on, the directive is limited, but noble Lords will know that the agriculture Ministers are studying the possible extension of our existing less favoured areas to include marginal land outside the hills.

Lord Sandford has drawn attention to the way the less favoured areas directive is implemented in the United Kingdom and was critical on a number of points, in particular regarding the role of Article 3(5). This provision relates, of course, to areas affected by specific handicaps and, as the report points out, is not at present applied in the United Kingdom. But one must be cautious of reading too much significance in this fact. Most of the areas which could qualify under this category are already designated under the "basic "Article: 3(4). And there is no difference in the aid given to each category. However, we shall continue to keep the application of the directive under review, including the case for promoting designation of certain small areas, not otherwise eligible for aid, under Article 3(5). I cannot say more at this stage.

The noble Lord, Lord Parry, asked about the application of Article 10(2) of the less favoured areas directive. The assistance available through tourist boards has a higher ceiling, more appropriate to tourism needs, than the directive. If a farmer can qualify for tourist board aid it does not require him to tie himself to a farm development plan, as the directive would do.

My Lords, fundamental to the future of rural areas is, as Lord Sandford and his colleagues point out, alternative employment to replace jobs lost in farming. At national level they make reference to the very useful work done by the Development Commission in promoting this end. I too should like to add my tribute to the achievements of the Development Commission which has just celebrated its 70th birthday. The noble Lord, Lord Northfield, who was so rightly praised by the noble Lord, Lord Peart, is of course the distinguished chairman of the commission, but unfortunately he is unable to be with us this afternoon. However, he kindly sent me a copy of the annual report for 1978–79, which has just been published. It provides a good account of what the commission has been doing initiating the building of over 250 advance factories and workshops in English villages and small towns since 1975, and it welcomes the increased awareness of rural problems. I trust that my noble friend Lord Henley will not think it is producing dark, satanic mills in so doing.

The report notes that the commission and its offshoot, the Council for Small Industries in Rural Areas, are being reviewed by the Government and a decision on their future is expected within the next month or two. The noble Lord, Lord Peart, mentioned this review in his speech, and I understand that the noble Lord, Lord Northfield, has said that he is guardedly optimistic about the outcome. All I can add at this stage is that we are giving very careful consideration to the issues and an announcement will be made as soon as possible.

The report criticises the urban emphasis of the European Regional Development Fund—the ERDF and the Social Fund which they think might be applied more generously to benefit rural areas. As noble Lords will know, however, the ERDF is only available to projects in areas receiving national regional aid. Although in the United Kingdom our assisted areas include some large tracts of countryside, the main thrust of our regional policy is directed towards our older industrial areas which have the greatest concentration of social and economic disadvantages. The Government's revision of the regional aid system and of the assisted areas, which will take its full effect in 1982, will ensure that resources for regional development are concentrated in the areas of most need. It is right that this should be so and that the much smaller resources of the European Regional Development Fund, which are a complement to national aid schemes, should likewise be concentrated, otherwise aid will be too diffuse and thinly spread.

The noble Baroness, Lady Stedman, stressed the point that Community funds should be regarded as some kind of bonus to be added to the funds available from the Exchequer. The Government take account of receipts from all sources when formulating their expenditure plans. Without a Community contribution, these expenditure plans would be lower.

As for the non-quota section of the fund, the report points out that that is extremely limited and that the Commission's first proposals have concentrated on some of the most difficult problems of the United Kingdom. Apart from the very special case of Northern Ireland's border area with the Republic, their proposals affecting the United Kingdom are concerned with areas suffering from the effects of steel and shipbuilding industry closures. These problems are severe both in scale and intensity and it is right that the limited resources should be devoted to assisting such areas. Indeed, the Government consider that more aid than the Commission have proposed should be made available to assist with the problems created by these closures.

We have, of course, noted the point made more generally in the sub-committee's report that rural areas benefit little from non-agricultural spending under the Community budget. None the less, because that budget is so heavily weighted in favour of agricultural spending, this means in practice a flow of resources to many United Kingdom rural areas, though I concede not necessarily to those most in need. At the same time, the resources available from other parts of the budget are very limited. It would be wrong to spread the small benefits which we get from some of those parts even more thinly;it would dissipate what small good they do and perpetuate the fundamental imbalances in Community expenditure. The Government seek, rather, a better balance within the budget as a whole and an agricultural policy more suited to the special needs and problems of the United Kingdom, including those of rural areas which are by their nature predominantly agricultutural.

A recent positive initiative by the Community has been the concept of "integrated development schemes ", proposed by the Commission in its communication on agricultural structures. The sub-committee have strongly endorsed their implementation and extension. We agree with the sub-committee's view that such schemes, involving the co-ordinated use of agriculture, social and regional funds, could prove a useful pathfinder to better integrated rural policies at Community level. If successful, they could make the agricultural population in certain areas less dependent on agriculture and thus on the support of specially high farm prices.

However, we must remember that present proposals are merely for pilot schemes. We shall need to ensure that they are properly prepared and integrated, and then fully monitored and evaluated, before committing large funds and efforts on similar schemes in other areas of the Community. As for the areas which the pilot projects should cover, this point is still under consideration. The views of the noble Lord, Lord Mackie of Benshie, will be noted. We agree that such projects should be under local management and not under the Community. I am sure, too, they should not be handed over to Brussels bureaucrats.

Reference is also made by the sub-committee to Community transport policy;the noble Lord, Lord Parry, and others were worried about that. But as the report points out, this matter is of great importance to those who live in rural areas, especially the more remote parts, and the noble Lord, Lord Sandford, and his colleagues observe that the Community transport policy appears to attach no special importance to the needs of rural areas. That is understandable, and it is appropriate that the transport chapter of the Treaty of Rome should concentrate on the international aspects of transport policy, such as harmonisation of conditions of competition, non-discrimination against other Member States' operators, and consignments. Policies on the provision of transport services in rural areas are determined in the context of national and local needs by the national and local authorities;this is not really a sphere in which a Community transport policy could make a useful contribution, as it requires small-scale improvements, innovative forms of transport and of management and self-help arrangements which can harness volunteer potential and help in recreating a sense of purpose in declining rural areas. There is little or no value in centralised or international planning on these.

Some points made by the report are ones which relate primarily to the European Commission as an organisation—for instance, the comments made on coordination of policies among the Com-mission's directorates general and the staffing of the environment and consumer protection service. Of course, these are matters essentially for the Commission itself. The recent Spierenburg report on its workings commented on a lack of coordination and made recommendations aimed at improving the position, but the House will know more about that shortly, in the next debate.

On staffing, we are aware of the comparatively small number of staff in the environment and consumer protection service relative to the tasks it undertakes. But I must point out that bids for increases in Commission staff are treated for budget purposes in total numbers. It is therefore up to the Commission to decide its own priorities for staffing in the light of increases finally agreed. The United Kingdom Government are, of course, bound to look very critically at any proposal to employ more staff at a time when they are seeking to restrain the growth of the Community's budget and, at home, are endeavouring to reduce numbers in the Civil Service.

Closely related to these matters are the proposals made in the sub-committee's report that the Community should adjust policies to encourage comprehensive rural development;should adopt a statement of objectives for rural policy;and should develop a central organisation to consider such policy and developments. The noble Lord, Lord Sandford, made the important point that policy for rural areas as regards forestry, farming and amenity considerations, should be tackled on a fully comprehensive basis. This is not, of course, in dispute, and I hope that will please the noble Earl, Lord Caithness. And of course, we fully accept that ADAS will have an important involvement. But in present circumstances we must take account of the likelihood that any major development in European Community policy or in central organisation within the Commission, would necessarily result in an increased total budget. Given present disparities between Britain's contributions to the Community and our receipts, this factor must, I would suggest, give us pause.

For the same reasons, I endorse the sub-committee's present rejection of the concept of a rural fund. In both the short and long-term, the Government's policy is to seek a better balance of expenditure within the budget and to restrain as far as possible the growth of Community expenditure. In that context too, the Government agree with the committee that at present a special community rural fund is not a practical proposition;it would only exacerbate our budgetary difficulties. At the same time, I also take note of the committee's view that: If total expenditure had to remain constant, a transfer of funds from direct agricultural support to other rural area expenditure would be needed". This worried my noble friend Lady Elliot of Harwood and the noble Lord, Lord Parry. Noble Lords will readily recognise that such a course of action would raise issues of' wide-ranging significance involving the CAP which lie beyond the scope of this debate. We agree of course that the CAP is in need of some reform, but, that said, noble Lords will, I think, accept the principle that we should not seek improvements in rural areas by lessening our concern to increase the efficiency of agriculture, and I endorse the wise words of the noble Lord, Lord Peart, on that.

Viscount AMORY

My Lords, I wanted to ask my noble friend before he reaches the end of an extremely interesting speech whether he would agree that when we have said everything about all these measures of diversification, if the day should ever come when efficient agricultural production in this country was no longer remunerative, the whole heart would be taken out of our countryside?

Lord MOWBRAY and STOURTON

My Lords, I think I would agree with that completely. So far, I have dealt principally with the report of the noble Lord, Lord Sandford, and his colleagues. I want to conclude by making some comments on the report on Farm Structures, with which the sub-committee chaired by the noble Lord, Lord Walston, was involved. We are greatly indebted to the noble Lord, and I am sorry that he is unable to be with us today.

I shall deal first with over-production. The Government agree with the committee's conclusion that over-production is to a large extent the consequence of too high prices. This is a factor which the Minister of Agriculture, Fisheries, and Food will have very much in mind in the CAP price discussions which are now in progress.

The views of the committee in paragraphs 9 and 10 of their report are noted, and to a great extent the Government have sympathy with them. As far as aid in the United Kingdon is concerned, tests of eligibility under both the Farm Capital Grant Scheme and the Farm and Horticulture Development Scheme exclude those who are not capable of earning a fair living from their holdings. We do not want to see aid distributed in the Community, except on a cost-effective and sensible basis. In paragraph 11 the committee appear to be speaking of denying aid to farmers because they are on good land. I feel that these thoughts need some clarification.

There are many factors which need to be taken into account in deciding who shall have, and who shall not have, aid. For example, we have ourselves recently introduced limits to the amount of investment which we will grant-aid. These limits will obviously affect the big investor more than the small man, but we imposed them in the knowledge that those operating large enterprises do not need so much support, because the Chancellor's Budget changes last year have increased substantially the proportion of net income available to these people.

Regarding the point on interest subsidies in other countries which the committee has made, under the Farm Modernisation Directive those countries are subject to the same limitations as the United Kingdom on total aid, but we prefer to offer similar levels of aid by way of capital grants.

In paragrpah 13 of their report, the subcommittee comment on the bans on certain investment aids proposed by the Commission. The Government have sympathy for the sub-committee's views, but it has to be remembered that not every Member State is in surplus on production;the United Kingdom and Italy, for example, are in deficit on dairy production. A key factor in the surplus situation is that of prices, and this aspect has to be solved separately. But the proposal for an investment aid ban must be considered further and solved within the context of the structure package as a whole.

Lastly, the committee, in paragraph 14 of their report, have expressed the belief that the Commission should formulate a long-term plan for structural policy. To an extent the Commission would certainly argue that their package of proposals taken as a whole, and bearing in mind the integrated regional programmes it contains, already represents the makings of such a policy. We do not suggest that the Commission package is without flaws, and the experimental nature of certain of the regional schemes must be emphasised. These particular ideas, of course, highlight the difficulty of trying to deal on a Community-wide basis with all aspects of structural problems. Many of these tend to be particular to individual countries. This points to the need for allowing for some national solutions, at national expense.

Rightly, the committee underline the importance of processing and marketing. The European Community affords help in these areas under headings other than the structures directives. Again, much must be done and allowed to be done by national actions. My right honourable friend in another place has appointed five eminent and lively marketing minds to seek out innovations and improvements without waiting for a Community Directive to do this for us.

We have had a full debate on the matters raised by these reports. I am most grateful for the points which speakers have made, and I have tried to comment on as many as I can in the time at my disposal. It is clear that in rural affairs at large the Community has an increasingly important significance. We must do what we can to ensure that this results in a better quality of life for those who live in our countryside. The reports of the noble Lords and their colleagues have served to highlight in a most clear and helpful way the issues and problems concerned. I am sure that I speak for all when I again extend to them my thanks.

6.14 p.m.

Lord SANDFORD

My Lords, I am most grateful to the speakers who have taken part in the debate, and I am sure that all my colleagues on the committee will be grateful for the complimentary remarks that have been made. I was particularly glad that the noble Lord, Lord Peart, complimented the noble Lord, Lord Northfield. His contribution to our committee was as valuable and as distinguished as is the contribution of the Development Commission to the countryside. I would have been disappointed and suspicious had we got through the debate without any controversy at all, and therefore I was particularly glad that the noble Lords, Lord Mackie of Benshie and Lord Peart, crossed swords with me, to a very minor degree. Unfortunately, I cannot disagree with the noble Lord, Lord Peart, about farmers, and I am afraid that I am not anti-farmer;I have to agree with him in being very much in their support.

The point at issue was a rather narrower, though I think nevertheless significant, one;namely, that whereas until perhaps quite recently it has always been possible to say, quite rightly, about almost every bit of the countryside—and Herr Ertl is always saying it about Germany and Bavaria—that if something is good for agriculture, it must he good for the countryside as a whole, my committee received quite a lot of evidence (which I was reporting to your Lordships), to the effect that there are parts of the countryside now where the common agricultural policy, if it is good for agriculture, is not always beneficial to the rest of the rural community. Perhaps we shall continue to disagree about that, but it is a rather different point.

This brings me to the end of this debate. All that I wish to add is that the next time I shall be discussing these matters will be when I am in Cumbria, at that admirable establishment on the shore of Lake Bassenthwaite, the Pheasant Inn. My Lords, I beg leave to withdraw the Motion.

Motion, by leave, withdrawn.