HL Deb 17 December 1987 vol 491 cc848-64

12.31 p.m.

Report received.

The Earl of Cranbrook moved Amendment No. 1:

Before Clause 1, insert the following new clause:

("Grants in respect of lower output farming.

—(1) The appropriate authority may, with the approval of the Treasury, by scheme provide in relation to any one or more parts of Great Britain for the payment by the appropriate Minister to the owners and lessees of land of—

  1. (a) grants towards expenditure which has been or is to be incurred for the purposes of or in connection with the reduction of agricultural production by means of less intensive management of land in agricultural use, which retains that land in production and facilitates the conservation, enhancement or protection of the environment;
  2. (b) grants for abating any financial loss which has been or will be suffered in consequence of such activity.

(2) The provisions of section 1(2) below shall apply to any scheme made under this section.

(3) The power to make such a scheme under this section shall be exercisable by statutory instrument and such a scheme shall not be made unless a draft of it has been laid before, and approved by resolution of, each House of Parliament.

(4) It is hereby declared that any function conferred on the appropriate Minister by or under this section is to be treated as a function connected with agriculture for the purposes of section 17 of the Agriculture Act 1986 (duty to balance interests when exercising functions connected with agriculture).

(5) A grant paid by virtue of a scheme under this section shall be paid out of money provided by Parliament.

(6) In this section— agricultural use"

  1. (a) in relation to England and Wales, means agricultural use within the meaning of the Agricultural Act 1947; and
  2. (b) in relation to Scotland, means agricultural use within the meaning of the Agriculture (Scotland) Act 1948.
"the appropriate authority- and "the appropriate Minister" have the same meaning as in section 1 below.

The noble Earl said: My Lords, in Committee, when my noble friend Lady Trumpington explained why she could not accept the new clause that I was then proposing, she emphasised two points in her concluding remarks: first, that the Government were about to issue a consultation document on the implementation of the extensification regulation of the EC; and, secondly, that the clause was legally unnecessary and probably contrary to Community law. I was heartily fortified by the widespread support that this amendment received from all quarters of the Chamber during the Committee stage, and indeed from many quarters outside. In withdrawing the amendment, I gave notice that I might come back at the Report stage.

Perhaps I may deal with my noble friend's two points. As we all know, the consultation document was issued by the Ministry on 8th December. With regard to limits on cereal production, it concentrates on set-aside. Perhaps I may refer to the press release of the right honourable gentleman the Minister of Agriculture, Fisheries and Food on 8th December. He stated: For cereals the principal means of achieving the reduction will he 'set-aside', by which I mean taking land out of production and putting it either to fallow, forestry or other non-agricultural uses". But he also reminded us that, other methods which reduce output without taking land out of production entirely will not be ruled out". To be specific, paragraph 15 of the consultation document, under the heading "Cereals, approaches not involving hectarage reduction", emphasises that such other methods can be considered and that the adoption of any such approach by the United Kingdom will require the specific authorisation of the Community. The document outlines some possibilities but does not go into any great detail.

On the second issue, on the legal point, advice taken with the help of the CPRE has confirmed that it would be technically incorrect to duplicate the mandatory provisions of the regulation. To make clear that this is not the case, and that this is not intended, the term "extensification"—which is now defined in EC-speak as a 20 per cent. reduction of output—and all other look-alike terms, including those which were aired in my previous version of the amendment, have been avoided in the present version.

I am also led to understand by legal advice that it is not only possible but common practice to introduce domestic legislation for discretionary elements of EC regulations in order to provide appropriate national powers for achieving the desired purpose. In order to make this clear I can say that the amendment is intended to relate to Article 1b1(a)—the final paragraph of the regulation. I have also been told that other member states of the European Community—notably the Netherlands, Denmark and Germany—are actively considering similar schemes to those proposed by this amendment, schemes that are designed to combine reduction in outputs with environmental benefits.

When I introduced the amendment at Committee stage, I was also quite justly challenged by noble Lords, to explain how such schemes could be implemented and administered. As I hope I then implied, I see it as no more complex than administering the Government's own proposals such as those for set-aside that are in the paper of 8th December or, for instance, schemes within ESAs which I take to be very relevant models.

I draw your Lordships' attention to the following points. First, the current periodic farm returns—which are already a national requirement—provide material for a base line. Secondly, thanks to research in which environmental bodies, MAFF, ARFC and others, have been involved, we can already predict the consequences on output of certain husbandry regimes that are known to be environmentally benign. Current work, including that supported by the NCC/NERC Special Topic on Agriculture and the Environment and that being sponsored by the research councils' joint working party on this subject, will add to our knowledge and will moreover emphasise the breadth of benefits to wildlife that can be obtained from such regimes.

In a little more detail I can explain that the procedure envisaged would involve the preparation of farm plans under which farmers would agree to adopt a regime or regimes appropriate to the whole farm—regimes which have been demonstrated to produce output reductions and environmental benefits. Such schemes might include the use of sprays approved by the Game Conservancy, the kind of scheme that is applicable to an ESA, organic farming, upland grazing management plans, and so on. Government support would be in the form of varying hectarage payment based on the regime adopted. This would be calculated on similar bases to payments available in the ESAs.

Income loss from lowered output would he alleviated to some extent by reduced input, but compensatory payments at the right level will certainly be needed to provide an incentive to bring in participating farmers. Given the very different circumstances of farms around the country, it will not be possible to predict the precise percentage reduction in every participating farm. There will be seasonal variations. There will also be variations which reflect the skill of the farmer. Payment levels therefore cannot be particularised but will have to be on a broad basis to reflect average expected loss on profitability. Different regimes will have different management implications and will attract different levels of payment.

In discussion we have come to the conclusion that it would be possible to define five or more regimes for arable land within which farmers would be able to operate. Each of these would be denoted by management practices and appropriate hectarage payments. The regimes of this nature would form the substance of the statutory instruments that will be necessary as a consequence.

If this amendment is accepted it will keep land in production and in good heart. It will therefore safeguard this vital national resource, holding it in readiness against those natural and social events, none of which is difficult to envisage or predict, that will at some stage require restoration of intensive agricultural production.

As I emphasised in Committee, the amendment also encourages farmers to continue to exercise the traditional skills in which they excel. Moreover, unlike straight set-aside, it will tend to support the agricultural infrastructure: the trade suppliers, the engineers, the mechanics, the consultants, the agronomists and others who form an integral part of the countryside community. I beg to move.

Lord Carter

My Lords, from this side of the House I am glad to welcome and support the amendment. We discussed the principle at length at Committee stage. The noble Earl, Lord Cranbrook, has already explained the matter at length so I shall be brief. He has amended the wording of the amendment to take account of the points raised by the Minister at Committee stage. His first amendment in subsection (1)(a) sets out admirably the objectives of United Kingdom agricultural policy, the reduction of agricultural production, the retention of land in production while facilitating conservation and protection of the environment. It is a voluntary scheme and has the advantage of enabling the farmer to farm every acre. That is extremely important in the maintenance of rural employment. It also has the knock-on effect with which we are all familiar on the rural economy generally. I quote just a few of the remarks which I made at Committee stage: Anything which keeps a crop on the land, helps us to work it and to keep men employed but reduces the intensity of output and has the difference made up by government grant is to be welcomed. Also it avoids the disadvantage of farmers receiving a grant for doing nothing".—[Official Report. 11/12/87; col. 1012.] The Minister concentrated at Committee stage on the problems of collecting the base data regarding output and the level of input. I should remind her that we used to have to produce all this information in great detail on the special account forms that we used to support grant aid applications under the farm and horticulture development scheme. All the information contained in those forms will be required under this scheme to show the level of production and the level of input. Even in those days we had a grant for keeping the records.

It is the reduction of inputs which would be the main agent for reducing output—less fertilisers and chemicals on arable crops and grassland—and I expect that less concentrated feed will be given to livestock. This will be the way in the main that output will be reduced.

I am sure that it could be done in practical terms. The noble Earl's amendment provides a good start. It marches with and improves on the ideas outlined in the consultative document on extensification. We hope from this side that the Minister will feel able to accept it.

Lord Hunt

My Lords, I was unable to be present at Committee stage and I am therefore all the more glad to be able to take the opportunity of supporting the amendment put down by the noble Earl. In my speech at Second Reading on 5th November I pointed out that in Clause 1 there was no reference to the environmental aspects of rural and agricultural land and the need to conserve or provide public amenities. I suggested that the words "farm business" in Clause 1 gave no such indication and I also drew attention to the fact that, unlike Clause 2, there was no reference to Section 17 of the Agriculture Act 1973, which places on Ministers the responsibility for striking a balance between the agriculture industry on the one hand and environmental conservation and public amenity, as well as economic interests, on the other. I suggested that that reference should also feature in Clause 1.

I mention that only because the amendment, which is far more explicit and provides a positive inducement to those aims to which I have referred, is obviously better than trying to play about with the wording in Clause 1. I warmly support it and I hope it is supported generally from these Benches.

12.45 p.m.

Viscount Ridley

My Lords, I too should like to support the amendment. I did so at Committee and I shall not now take up too much time on this. What is new on the scene since we spoke at Committee is the publication, as my noble friend has said, of the consultation document, which I believe is an important start in coping with the massive problems of overproduction in Europe. It is a great start and should be welcomed as such, for it goes a long way towards meeting the amendment of my noble friend Lord Cranbrook, especially where it talks about beef farming. In fact it goes as far as one might expect on that aspect of farming. The acceptance of the amendment, which is only an enabling one, would surely be a sensible further step for the Government to take.

I very much doubt whether the figures quoted in the cereals part of the document—it is said that the farmer will receive between £150 and £200 per hectare for setting aside so much land—will be adequate to tempt many farmers to join the set-aside scheme. I shall not go into further details. Many farmers are saying already—I am not sure of my figures—that it will take at least twice that amount to persuade them to give up arable farming on the scale needed to achieve a 20 per cent. set-aside. I argue that the amendment, which is an alternative way of reducing overproduction, should be welcomed and taken on board. It is another way of reducing arable production and overproduction and makes total sense in the context of what we are discussing. I hope that the Government will accept it as such.

Finally, I cannot help briefly recognising that the document takes account of the need not to have too much nitrogen on set-aside land. I am delighted because I spoke about that last time and the writers of the document appear to have taken note of what I may have said.

Lord Mackie of Benshie

My Lords, I too was unable to be here at the Committee stage because I was on Western European Union business. I welcome the amendment because it appears entirely sensible. This is an enabling Bill, but it enables only two measures. Thus, why not take advantage of it as drafted and offer a further sensible course for the Government to take, if they wish to and have the money to take it?

There is no question about the money being available. From a farming point of view—I must admit that I am more interested in farming than in the wildlife—much of the land on which surpluses are being produced in this country was never meant to be farmed for cereals but for grassland. Much of it was very bad grassland, full of buttercups, which were no doubt very beautiful to the eyes of the city beholder but were not much use to the farmer. There is no reason why it should not be well farmed as grassland without the addition of a lot of nitrogen, and why that should not be as profitable to the farmer as a more intensive use and more input to grow cereal crops which are not big enough to make a profit for him.

There is the money available. I have given the figures time and again. Two tonnes saved from the surplus will give at least £200 an acre, not a hectare, to play with. If half of that is saved and half is given, one makes a start on using the land in a way which will enable a farmer to make a profit without a tremendous number of inputs.

I welcome the amendment and I hope that the Government will be sensible and accept it. I hope that we shall not hear from the noble Baroness many reasons why she cannot accept it. I am not very encouraged by the look on her face, but we shall see.

Lord Gibson

My Lords, I apologise for not having been in my place when the noble Earl moved the amendment. I noted what he said and I am in total sympathy with it. I noted the Government's objections too, that the intensification would be difficult to monitor and therefore to apply equitably with reasonable economy, and also their apprehensions in regard to EC legislation. But the noble Baroness declared that the Government's mind was not closed. And since then we have had MAFF's consultation document. This, too, does not exclude the possibilities behind the amendment, but the paragraph on de-intensification—and this is what worries me—is so slight and the emphasis in the document as a whole so strong on reductions in area rather than in yield that I am not surprised that the noble Earl has returned to the subject.

I believe that reductions in both area and yield are options we should pursue. Reductions in area make economic sense and reductions in yield will bring benefits which reductions in area alone cannot confer. The reductions in yield may well be increased in areas not set aside in which case the environmental problems which over-intensification has brought in its wake will be aggravated.

I feel strongly on another point the noble Earl made. Quite apart from conservation, it is important to remember that agricultural land is a vital national resource which at some future date we may want to use to re-intensify production. Extensify, I do not understand, but I do understand de-intensify and re-intensify. At Second Reading the noble Lord, Lord John-Mackie, quoted an authoritative source forecasting a need in only 30 years' time for a two-and-a-half fold increase per unit area of land. If you de-intensify, at least you can re-intensify if you need to; but where you turn it over to other uses, depending on the use, it will take a great deal longer and will be very much more expensive.

In spite of these arguments, I infer from MAFF's consultation document that it prefers set-aside to de-intensification—lower input, lower output—and this must be because of the difficulty of implementation. It has already been shown that the EC regulation permits national discretion in the choice of methods employed to reduce production. I find it hard to see how EC law can be a valid reason for rejecting at least the principle behind the amendment. There may be a technicality I do not understand—that is all too likely, I am afraid—but difficulty of implementation is a much more serious one.

However, as has already been said—and I want to support the point—this is an enabling Bill and therefore in a sense an experimental Bill. Why not take power in principle to subsidise de-intensification with a view to trying it on a modest scale and increase it as experience warrants? Without that power, the social, economic and environmental objectives which lower input-lower output can be expected to achieve may not be achievable and we shall have to rely on set-aside for which there is certainly a place but which is not relevant to the purposes at the back of the amendment; and purposes which are supported by so many of your Lordships may not be achievable.

In Committee the noble Earl, Lord De La Warr, complained, most understandably I thought at the time, that the timing of the amendment was wrong. That was not the fault of the mover of the amendment. Presumably he had in mind the developments in the Community. But what other opportunity will we get for giving our objectives, which so many of your Lordships share, a legal basis? For this reason above all, I strongly support the amendment.

The Parliamentary Under-Secretary of State, Ministry of Agriculture, Fisheries and Food (Baroness Trumpington)

My Lords, as I said when we discussed the previous amendment of my noble friend Lord Cranbrook, we are extremely interested and have most certainly not excluded the ideas which are incorporated in the amendment he has brought before us today. However, with the greatest respect, my noble friend is putting the cart before the horse. He is asking the Government to incorporate his clause into the Bill before the consultation document which we have just issued has drawn any formal reactions from either individuals or bodies except for the Council for the Protection of Rural England which I know has advised my noble friend on the amendment. Furthermore, and I quote from the letter the CPRE so kindly sent me: Clearly it would still be necessary to seek EC authorisation for the implementation of a scheme along these lines and acceptance of the principle of this amendment would require the United Kingdom Government to seek such authorisation". In other words we would be putting into a United Kingdom statute a power which stands in grave danger of reversal when further EC legislation appears in the coming months. Where is the sense in that?

Lord Mackie of Benshie

If it turns out to be against EC regulations, surely the Government do not need to put it into effect. It is an enabling Bill.

Baroness Trumpington

We would have to reverse a provision such as my noble friend is suggesting today. If it were included in the Bill, we would have to reverse that clause.

On the legal point, I explained at Committee stage that powers already existed in Community legislation to introduce a scheme to reduce production. Such a scheme could include reduction of production by less intensive farming methods. The taking of such powers in national primary legislation is therefore unnecessary and might, indeed, cause concern about overlapping powers. My noble friend has recast his amendment so that it no longer actually duplicates the powers provided in EC legislation to establish an extensification scheme. The fact still remains that the provision is unnecessary because the EC powers which already exist provide wide scope for schemes along the lines described in the amendment. These can be implemented under the European Communities Act by means of a domestic statutory instrument. This would therefore be nugatory legislation.

As some of your Lordships will be well aware, the Government are at the present time playing a leading part in Europe in respect of a whole series of measures relating to extensification and the various possibilities that could make up a wider set-aside scheme. We have already demonstrated our commitment to the environment by negotiating environmentally sensitive areas under EC legislation. Our readiness in the United Kingdom to press ahead with the implementation of ESAs has given a lead to the Community. On a more detailed point we have recently seen a first draft of the Commission implementing regulation on extensification. Discussions are at an early stage and a great deal of clarification is needed. In that regulation there is an article which specifically lays down conditions for a method of reducing production which applies by lowering output across the whole farm. We need to see the outcome of these negotiations before taking any final decisions.

I turn now to the point about which some noble Lords were concerned. I refer to whether the Government are prepared to do anything positive to encourage lower intensity farming. Of course we have an open mind. This is one of the reasons why we have issued our consultation document to crystallise ideas and undertake the work involved. I say to the noble Lord, Lord Gibson, that no possibilities are ruled out, and that includes reduced yields. What we do know is that, despite what my noble friend has said, his amendment would require a huge bureaucracy. I quote again from the CPRE's letter to me. It has suggested that there should be an investment in "sensible levels of bureaucracy". The mind boggles. If I may take up a point made by the noble Lord, Lord Carter, it is precisely because of the experience we have in implementing other schemes such as AHDS that we know there are difficulties and that it takes an awful lot of people to do it.

My noble friend Lord Ridley said that payments proposed for cereals are too low. I would say in the mildest terms to him that we need to consider the correct level of payments to offer in the light of the views of the consultees. We need to be completely satisfied that any scheme will be workable and cost-effective and offer good value for money. I have doubts whether we could be sure today that the amendment would do so. To take this year as an example, because of the awful harvest we have had, which was strictly a natural phenomenon, if we had been operating a scheme of the kind described in my noble friend's amendment we might have been obliged to pay large sums of money to farmers for reducing production when in fact they had taken no steps to do so. The Government could not defend that to the taxpayers.

Lord Carter

My Lords, I am grateful to the noble Baroness for giving way. Surely it will be voluntary and the grants will be available only to farmers who have entered the scheme. Therefore, if yields are reduced as a result of bad weather but one has not entered for the voluntary scheme, one will not receive the grant.

Baroness Trumpington

My Lords, if a farmer has applied for the grant and there is bad weather, he will still be eligible. The EC Commission would expect proof that a reduction in production had been achieved. It would probably not be satisfied to rely on methods of management. To safeguard public funds we too would need proof that output had fallen. However, this area requires further work.

I do not wish to sound negative about the spirit behind this amendment. In a community burdened with surpluses there is clearly a place for farming by less intensive methods. Indeed, we believe that one result of the price restraint policy we have been pursuing for a long time is that in the face of lower prices farmers will closely examine their costs in a way which may well result in reduced inputs and adoption of less intensive methods. As noble Lords know, we are continuing to pursue in the present Brussels negotiations a policy of price reductions complemented by set-aside, on which we are taking the lead. While the Government have by no means set their face against a low intensity policy, we recognise difficulties with it which the consultation exercise will help us to investigate. Therefore we feel it would not be right to legislate now, prematurely, before full consideration has been given to the issues raised and their solutions. But if in the light of consultations we can devise a satisfactory and cost-effective scheme, we have the powers available, which are likely soon to be strengthened by further Community legislation. For these reasons, I ask my noble friend kindly to withdraw his amendment.

The Earl of Cranbrook

My Lords, with the leave of the House, I am forced to say that, speaking for a department which is required by law to take into account conservation, I am extremely disappointed by my noble friend's reply. As the noble Lord, Lord Gibson, said, what other opportunity shall we have? My noble friend has said that the Government retain an open mind. However, an empty mind is not an open mind and there is an extreme vacuity in the consultation document which we have before us. It fails totally to approach the problem which has been aired.

I spoke of the strength of feeling around the House, but there has been a strong response from all nongovernmental environmental bodies. There has been plenty of thought. I have taken a great deal of trouble to keep my noble friend fully informed of all the thinking of which I am aware. I do not believe that she will criticise me for failing to keep in touch with her and to keep her informed.

My noble friend says that no possibilities are ruled out as a result of the consultation process, but where is the initiative? What steps has the Ministry of Agriculture, Fisheries and Food taken, with the backing of many noble Lords round the House and the many other non-governmental organisations which have strong feelings, to respond to the initiative that I have tried to bring forward? I take the point that my noble friend has said that the amendment would bring something into the Bill which would be nugatory. Mere nugatory effort is not necessarily effort which is wasted. According to the legal advice that I have received it would not be contrary to EC law to legislate in an area which is already within the discretionary powers of a regulation. It is essential that this should be a weapon in the armoury of our Ministry of Agriculture when it takes its final stance on the implementation of measures to deal with the whole problem of reducing agricultural output.

I have some of the figures available. I have a Written Parliamentary Reply on the common agricultural policy of 9th December 1987 in which the Minister states that the latest forecast outturn for the United Kingdom is that in cereal support we shall be spending £191.1 million and in beef and veal support we shall be spending £243 million. Those are large sums of money and are at present supporting increased output. That money can perfectly well be diverted and some of it can be saved in reducing output, so improving the environmental status of our rural areas.

I have no up-to-date figures on the exact cost per hectare. The only available figures that I have are again from the Parliamentary Written Answer. The right honourable John Selwyn Gummer was replying. The figures available to him in April 1986 gave a cost of £130 per hectare for average expenditure on cereals. That money is supporting excess production and not environmental benefits.

I do not feel that to take a nugatory step is to take a wrong step. It simply means that we are doing something which is unnecessary. I do not take the point that we are doing something which is bound to be against EC regulations. If my noble friend tells me here and now that to press the amendment to a Division would be inviting the House to so something which is illegal in EC law, I would not do so. I do not know whether she wishes to say that. Otherwise, I feel that we must see this amendment incorporated into the Bill. I beg to move.

1.8 p.m.

On Question, Whether the said amendment (No. 1) shall be agreed to?

Their Lordships divided: Contents, 54; Not-Contents, 67.

DIVISION NO. 1
CONTENTS
Addington, L. Massereene and Ferrard, V.
Airedale, L. Monkswell, L.
Ardwick, L. Monson, L.
Aylestone, L. Morton of Shuna, L.
Banks, L. Moyne, L.
Bruce of Donington, L. Nicol, B.
Carter, L. Ponsonby of Shulbrede, L.
Craigton, L. Ridley, V.
Cranbrook, E. [Teller.] Ritchie of Dundee, L.
Elliot of Harwood, B. Sainsbury, L.
Elwyn-Jones, L. Saltoun of Abernethy, Ly.
Ferrier, L. Seear, B.
Gallacher, L. Serota, B.
Gibson, L. [Teller.] Shackleton, L.
Graham of Edmonton, L. Silkin of Dulwich, L.
Gregson, L. Stanley of Alderley, L.
Hampton, L. Stedman, B.
Hayter, L. Stockton, E.
Hunt, L. Strabolgi, L.
Jay, L. Tordoff, L.
Jenkins of Putney, L. Turner of Camden, B.
John-Mackie, L. Underhill, L.
Kennet, L. Wallace of Coslany, L.
Kilbracken, L. White, B.
Mackie of Benshie, L. Williams of Elvel, L.
McNair, L. Winchilsea and Nottingham, E.
Mais, L. Winterbottom, L.
NOT-CONTENTS
Alexander of Tunis, E. Kings Norton, L.
Arran, E. Kinnoull, E.
Beaverbrook, L. Lane-Fox, B.
Beloff, L. Lauderdale, E.
Belstead, L. Lovat, L.
Bessborough, E. Lyell, L.
Blyth, L. Mackintosh of Halifax, V.
Boyd-Carpenter, L. Marley, L.
Brabazon of Tara, L. Merrivale, L.
Brougham and Vaux, L. Morris, L.
Cameron of Lochbroom, L. Mottistone, L.
Campbell of Croy, L. Mountevans, L.
Colnbrook, L. Munster, E.
Cork and Orrery, E. Napier and Ettrick, L.
Crickhowell, L. Nelson, E.
Cullen of Ashbourne, L. Newall, L.
Davidson, V. [Teller.] Nugent of Guildford, L.
De La Warr, E. Pender, L.
Denham, L. [Teller.] Plummer of St. Marylebone, L.
Denning, L. Radnor, E.
Dundee, E. Renton, L.
Effingham, E. Romney, E.
Ellenborough, L. St. Davids, V.
Elton, L. Selkirk, E.
Faithfull, B. Sempill, Ly.
Fanshawe of Richmond, L. Skelmersdale, L.
Ferrers, E. Slim, V.
Gainford, L. Strange, B.
Gray of Contin, L. Swansea, L.
Greenway, L. Swinton, E.
Hesketh, L. Thomas of Gwydir, L.
Hives, L. Trumpington, B.
Home of the Hirsel, L. Vaux of Harrowden, L.
Ironside, L.

Resolved in the negative, and amendment disagreed to accordingly.

Clause 2 [Grants in respect of farm woodlands]:

1.15 p.m.

Baroness White moved Amendment No. 2: Page 3, line 11, leave out ("land from agricultural use to use for") and insert ("arable land and improved grassland to")

The noble Baroness said: My Lords, I referred to this briefly at Committee stage and felt that it was desirable to put down an amendment at this stage in order to have a much more considered reply, I would hope, from the noble Baroness. I might point out that the consultation paper on extensification hardly touches the matter with which we are dealing because it extends only to cereals and beef. I do not know whether the Government are proposing to bring out a consultation paper on the future of sheepmeat, but that would have been of greater interest to those of us concerned with the mainly upland areas to which this amendment refers.

I indicated at Committee stage that the government's proposal that 3,000 hectares of the area for which special grants are to be available for woodland planting should apply to the disadvantaged or specially disadvantaged areas meant that the advantage of the scheme to farmers was minimal. What we are really concerned about in this amendment is to offer those in these areas a more comprehensive and better considered scheme than that now proposed.

It is true, I believe, that if each applicant acceptable to the scheme within the limits laid down planted up to the maximum of 40 hectares, there would be fewer than 100 farmers directly affected which does not make much difference either way. In practical terms, of course, it would be improbable that you would have everyone planting up to the maximum permissible limit.

But what we are concerned about is that if the real objective of the scheme is not to plant a few more trees in these areas, but really to try to sustain some kind of viable farming in the specially disadvantaged—I was thinking of the word "deprived"—areas, one needs something much more comprehensive and on a much more satisfactory scale. Plainly, one wants to keep up activity in these areas.

It is a different situation from the set-aside which was being discussed by the noble Earl, Lord Cranbrook, on the previous amendment. But it has something of the same social consequence in it. We want to keep people in the disadvantaged areas, who are active on the land and not merely going in for the various diversifications, helpful though they may be, that we discussed in the immediately preceding debate. Incidentally, as my noble friend Lord Carter indicated, as we understand it, the extension of the diversification assistance, the more generous coverage referred to by the noble Lord, Lord Hesketh, is of course no doubt extremely welcome in the other areas. But it does have the effect of depriving the areas which we are discussing under this amendment of the differential advantage which they previously enjoyed as less favoured areas. In other words by extending the grants much more widely to other parts of the agricultural scene the differential advantage is thereby removed from those who had previously been so favoured.

As I have said, as regards the main concern in most of the upland areas at any rate (which is the rearing of sheep) we are not sure what is intended. Possibly other noble Lords are interested in that matter. However, I am told that the position as regards sheep is nothing like as urgent or as difficult as that of cereals and beef which are dealt with in the consultation document. Nevertheless, some also foresee difficulties in that connection.

What we are really asking for in this amendment is that we should not have a situation in which the Government say: "Oh, well, we have made arrangements for the disadvantaged areas to receive £30 a hectare if they are prepared to grow trees, but we are not really thinking very much of anything else." That does not seem to us to be adequate to maintain the social fabric or the agricultural future of the areas concerned. That is why we are asking the Government to indicate that they have given thought to this matter and thought to the environmental relationships between this proposed grant and the landscape and the wildlife conditions of the areas that we are discussing.

We should hope to receive from the Government an indication that they have thought through what is really the best way of sustaining both the agricultural and the social fabric of these areas. Obviously, one does not wish to suggest direct income supplements in order to maintain population. If one is going to pay grants in order to sustain the agricultural and rural health of these areas, it seems to us that it is very necessary that one should take a much closer view of what is ideally necessary and how one can adopt a more comprehensive approach. Admittedly, when I say "us", I am talking mostly for environmental bodies. I am not sure whether anybody in the Ministry of Agriculture, Fisheries and Food has really been thinking in those terms. I could not give notice to the noble Baroness of this point. Therefore I would not expect her to reply in detail. However, it has been drawn to my notice that in at least two of the national parks very considerable attention has been paid to comprehensive management of moorlands, uplands, grasslands and existing tree plantations.

The Peak District in particular, so I am told, has given a great deal of thought to this, and has great experience in such matters. Exmoor is another example of where farms not directly connected with the mechanism that we are discussing under the Bill have themselves been experimenting in how one can carry out improvements which allow for diversification and which also protect the environment and sustain the social fabric of the area.

I do not know whether the noble Baroness will simply reply, as I think she might, that if the Government are offering grants for planting trees at all they cannot leave out the special areas. I entirely understand her point of view, but we are saying that it is not good enough to suggest simply offering grants—at a very low level, incidentally—for planting trees without taking into account the effect on the environmental and wildlife spheres. That does not seem to us to be satisfactory. I have here a letter from the World Wildlife Fund in which it expresses its concern about: allowing planting of 3,000 hectares of unimproved land in the less favoured areas because, unless carefully monitored, planting in these areas could damage valuable wildlife habitat".

A good deal depends on where one plants and what is planted. We are not by any means convinced that if the clause goes through exactly as it now stands, without the amendment, that there will be any incentive to anybody to consider the totality of the development or even what type of trees are to be planted. There is no requirement in this particular arrangement as I understand it for any consideration of what type of trees should be planted. If one is planting trees purely commercially then conifers are the obvious answer. What we do not want is a straightforward plantation of conifers planted by those who wish to do that who probably have other income and who do not really mind whether they only receive £30 per hectare. We do not think that that is socially the most desirable thing.

We really want a comprehensive plan for these areas that is based on the philosophy of the environmentally sensitive areas; in other words, with positive incentives, positive encouragement and positive thought rather than the negative compensation for not doing things which is what applies to most of the management agreements in other situations.

The real point of moving this amendment is to draw the attention of the Minister and through her of her department to the need for, among other things, consulting with those particularly in the national park areas because they have the special responsibility in those areas as to how one can have a much wider looking, more socially and more environmentally conscious method of assisting the farming population in those areas who will find it very difficult indeed to continue living there on any kind of viable economic basis. We think that this is much too narrow an approach and we think it does not make provision for the other considerations which should be included in the areas concerned.

I hope very much that the Minister will at least recognise that there is concern, apprehension and dissatisfaction in the organisations which are particularly anxious to maintain viable social life and viable agriculture in the areas which are not dealt with in the consultation document which will lose their preferential advantages under the otherwise no doubt desirable diversification grants that we have been recently discussing. I hope that the Minister's department will take fully into account—even though it is not responsible for them—the experience of the national park authorities which are working very hard in this particular field.

Lord Hunt

My Lords, from these Benches I rise to support the amendment moved by the noble Baroness. I shall do so very briefly. I propose to approach it in a rather narrower context than the noble Baroness did. If I have understood the amendment correctly—the noble Baroness must correct me if I say that I found it rather difficult to understand, not from her expedition so much as from the wording of the amendment—the effect of it, if not the intention, will be not to encourage and indeed to discourage the planting of conifer forests on the uplands in the severely deprived and deprived areas where those types of trees particularly flourish. That is a negative purpose or it would have a negative effect, and from the narrow point of view I support that effect.

Your Lordships will perhaps forgive me if I speak with particular feeling about the extensive conifer plantations to be seen on nearly all the hill land along the Welsh border, where a great deal has already been done to spoil the natural beauty of the landscape. I am thinking particularly of mid-Wales. However, it is true elsewhere. We have had for a long time the blanket areas of dense, dark, regimented spruce plantations. It is appalling both from an environmental and a landscape point of view. The effect of the Bill and this particular part of it as it stands will certainly not exclude the payment of grants for extending that kind of environmental depredation. I approve of it on those grounds.

Looking at it from the positive point of view, as I read the amendment it should have the effect of encouraging the planting of trees of whatever kind. Farmers will plant for profit on just those areas of land where agricultural production which is in excess—milk, meat and cereals—needs to be reduced. If that is the positive purpose of the amendment, I warmly support it.

Lord Carter

My Lords, from this side of the House we welcome the amendment. My noble friend has explained very clearly the need for comprehensive marginal land improvement schemes taking into account the balance between the broadleaved species, conifers, upland livestock and the environment generally. As she has said, the 3,000 hectares which will be spread over all the SDAs is marginal. That is not really significant if we are to balance all the needs which she has mentioned in the uplands areas. We hope that the Minister will be able to agree that such a comprehensive scheme is required and will be able to satisfy the House on the arguments that my noble friend has advanced.

Lord Kilbracken

My Lords, my noble friend has just said that we on this side of the House support the amendment. However, I am bound to say, speaking as a forester and an environmentalist, that I do not approve of it. As I see it, the purpose of the amendment would be to confine giving of the grants to areas of arable land and improved grassland and therefore exclude lower quality agricultural land. In my opinion, it is only on such land that the planting of trees is a profitable operation. If trees are planted on arable or improved ground, the loss of agricultural income from those areas during the 40 years or more that the trees are growing, plus interest over the whole period, is such that it takes away all profit from the planting of the trees. One has to consider how much wealth is being created by afforestation of that sort. I feel that encouragement should be particularly directed towards the lower quality areas of farmland and not encouraged where very rich land is involved.

Perhaps I may also mention that I feel some doubt about the word "arable" in the amendment. It originally meant capable of being planted. Presumably it still means that. However, sometimes it is used to mean land that has been ploughed, and sometimes it is used loosely to mean any form of agricultural land. I do not know if it has been defined in any statute. However, I feel some doubt about it.

The noble Lord, Lord Hunt, referred to the environmental unsuitability of the sitka plantations, and so on. I know what he means. But I should point out that that is the profitable way of growing trees. If trouble is taken with the planting in choice of species, one does not have a monocultural expanse. For instance, I very much like to plant European or Japanese larch in blocks through the sitka and put some hardwood trees around the edge, thus avoiding large square blocks. I can assure the noble Lord that I could take him to a softwood planting site put down almost 40 years ago and he would find the trees very beautiful. Some birds may go out but others go in, such as goldcrests and the whole of the tit family. I am now waiting for the first crossbills to arrive. It is not an environmental desert. I hope that I shall be forgiven, therefore, for dissenting from my two noble friends on that matter.

Baroness Trumpington

My Lords, I am sure that the noble Baroness will forgive me if, although I could, I do not take up the matter of sheep. The amendment deals with trees and not sheep. The effect of the amendment, for the benefit of the noble Lord, Lord Hunt, and other noble Lords, would be to exclude all agricultural land other than arable land and improved grassland from the grants we shall be empowered to offer under Clause 2(1)(a)

Perhaps we may look at the issue of principle first. Like the noble Baroness, we are keen to see the scheme focusing primarily on arable and improved land. That is what the retargeting of the scheme which I announced at Second Reading is all about. However, we had to recognise that some farmers in the less favoured areas might not have any improved land or might not be able to release it without jeopardising the viability of their holdings. We therefore decided that we should allow 3,000 hectares of planting on unimproved grazing land in those areas during the three-year experimental period. That is particularly designed to help farmers in Wales and in Scotland. I am therefore surprised that the noble Baroness has not welcomed the provision. Given the overall limit, we do not see a risk of significant loss of upland habitat to trees.

On a point of detail, the £30 rate only applies to rough grazing. On improved land, farmers in the less favoured areas will get £150 a hectare in the disadvantaged area and £100 a hectare in the severely disadvantaged area. I also remind your Lordships that we intend to maintain appropriate safeguards in certain statutorily designated areas such as national parks, sites of special scientific interest and environmentally sensitive areas because those are of special conservation importance. We do not expect the new arrangements to lead to environmentally damaging planting. However, we shall be reviewing that and other aspects in year three of the scheme. I therefore ask the noble Baroness kindly to withdraw the amendment.

Baroness White

My Lords, naturally I am grateful to the Minister for replying to the amendment. However, I am disappointed that she has not dealt at all with the desirability in those areas of having a much more comprehensive approach—concerning the environmental aspects specifically—than may be required in the other areas to which the scheme applies. We want something better for the uplands. We want something more generous. There has been no indication of any government thinking on that point.

The amount of £30 per acre for rough grazing, which is what most of us have in those areas, is not going to get us very far, as was said on a previous occasion. So far as concerns environmental desirabilities, I must say, in looking at the consultation document for beef and cereal areas, that I was frankly shocked to see that whereas an applicant whose farm included an area designated as a site of special scientific interest would be required to notify the Nature Conservancy Council of his proposed application to join that particular scheme, it goes on to say that applications in national parks, in the Norfolk and Suffolk Broads or in Scotland and national scenic areas would be invited to notify the appropriate authority. In other words, there is no obligation so far as concerns the areas covered in this document. So far as we can make out there is no obligation under the Bill which is now before us for there to be consultation even in connection with national park areas. I am not quite sure whether sites of scientific interest can be brought in. There is no obligation here. Perhaps the noble Baroness will wish to reply on that point?

Baroness Trumpington

My Lords, may I interrupt the noble Baroness by saying that her amendment does not deal with that point.

Baroness White

My Lords, it deals with the much wider issue of the plantation of trees in the upland areas which can be planted, according to the proposed scheme in the Bill, without necessarily consulting anyone at all. One simply applies for the grant and if it is within the hectarage and within the designated area of disadvantaged land, then, so far as I can make out, one can simply go ahead up to the maximum limit regardless of any other consideration.

It is quite clear that we are not going to get very far with this discussion on the present occasion. We may have further opportunities of raising the matter on a much broader base and of proposing a much more comprehensive scheme for dealing with the structure in these upland areas. These are going to be especially socially and economically disadvantaged. I grant that this may have seemed a rather awkward way of bringing the matter forward, but we had to deal with the Bill as it was. In those circumstances, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Denham

My Lords, as the business so far has taken rather longer than expected it has been agreed through the usual channels that we should adjourn consideration of the Bill at this stage and revert to it after the Recess. I beg to move that further consideration on Report be now adjourned.

Moved accordingly, and, on Question, Motion agreed to.