HL Deb 09 February 1987 vol 484 cc495-504

7.50 p.m.

Lord Belstead

My Lords, with the permission of the House I should like to repeat a Statement that is being made in another place by my right honourable friend the Minister of Agriculture, Fisheries and Food. The Statement is as follows:

"The Government have been considering very carefully the consequences for agriculture and for the rural economy of changes in the common agricultural policy.

"We have concluded that given the scale of agricultural surpluses now facing us, a new balance of policies is needed. This will entail less support for expanding production; more attention to the demands of the market; more encouragement for alternative uses of land; more response to the claims of the environment; and more diversity on farms and in the rural economy.

"To assist the process of change I am announcing a number of new policy initiatives. Details are set out in a Written Answer today, but I shall briefly describe what is planned.

"First, a new scheme will be introduced to encourage the development of farm woodlands which will take some land out of agricultural production. The detailed arrangements will be the subject of consultation with interested parties prior to the introduction of appropriate legislation, but the scheme will incorporate provisions for the protection and enhancement of the environment.

"Secondly, the Government propose an expansion of the forestry programme, with particular emphasis on the private sector and with due regard to environmental considerations. The planting of a higher proportion of trees on low ground of better quality will also be encouraged.

"Thirdly, the Government will be designating further environmentally sensitive areas under Section 18 of the Agriculture Act 1986. We have already designated nine areas and our intention is to extend the coverage of this scheme and to double the funding from early in 1988.

"Fourthly, diversification of enterprise on farms will be encouraged by the introduction of a scheme under Section 22 of the same Act, providing for the grant aiding of ancillary businesses on or adjacent to farms. There will also be extra help for marketing of the products of diversified businesses.

"Fifthly, within my budget for research, development and advice I shall be placing more emphasis on the possibilities for novel crops and livestock and on the socio-economic and environmental implications of the changing farming scheme.

"Sixthly, my right honourable friends the Secretaries of State for the Environment and for Wales have today put out for consultation a draft circular containing guidance on the future planning regime for agricultural land. It will include more encouragement to local authorities to take a positive attitude to diversification and to the conversion of redundant farm buildings.

"In addition, my right honourable friends the Secretaries of State for Scotland, Wales and Northern Ireland and I plan to publish next month a document describing how the Government's policies towards farming are being adjusted to reflect the changing scheme and potential in the rural economy as a whole. I shall of course make this available to the House. It will make clear that the Government's overall objective is to facilitate the conditions which encourage a healthy rural economy based on enterprise, adaptability and fair competition."

My Lords, that is my right honourable friend's Statement.

Lord Gallacher

My Lords, first, I should like to thank the Minister for repeating in this House a Statement made in the other place. The Statement is a fairly quiet document and yet this side of the House has the feeling that certain matters contained in the Statement herald further changes in agriculture which could be of considerable significance. I want to ask the Minister one or two questions about those aspects of the Statement.

First, on the subject of afforestation and the encouragement of afforestation on a small scale on farms, on the one hand, and a further encouragement of the development of afforestation on a larger scale by the private sector on the other hand, will the Minister tell us what role is envisaged for the Forestry Commission in both those areas? We are aware that the farmers may need considerable assistance even for small-scale afforestation on farms. The Forestry Commission has a part to play in large-scale afforestation particularly as regards the financial assistance and grant schemes which apply to such large-scale developments.

We welcome the third proposal contained in the Statement about extending environmentally sensitive areas. I should like the Minister to tell us whether in that proposed extension areas which were unsuccessful (not selected under the present scheme) will be automatically reconsidered or whether they will have to apply for reconsideration. What further areas are contemplated? In particular, is it intended that environmentally sensitive areas will apply to parts of the country at some distance from existing environmentally sensitive areas so that there is a fairly wide spread of that highly desirable development which takes place under the Agricultural Act 1986?

The Statement mentions two documents, one relating to the Department of the Environment and the other to the Ministry of Agriculture, Fisheries and Food. The Statement clearly said that the document from the Ministry of Agriculture, Fisheries and Food will be a consultation document, and we welcome that. The consultation relating to the conversion of redundant farm buildings is well-known to us but we wonder what is contemplated with regard to the increased encouragement to local authorities to take a positive attitude to diversification. Will local authorities be enjoined to be considerably more forthcoming about changes of land use? Is that what is envisaged? How extensive does the Department of the Environment propose to see those changes of land use, particularly where land is being taken permanently out of farming for housing and kindred development?

The document that the Minister of Agriculture, Fisheries and Food is to circulate is fairly important because from its description in the Statement it does not appear that it is in the nature of a consultation proposal but rather that it will indicate previously decided government policies. If that is correct, will the Minister tell us whether the document, when we see it in a month's time, will be in the nature of a White Paper, a Green Paper or a White Paper with green edges or a Green Paper with white edges? I ask that because I believe that I am correct in assuming that there will be no consultation on the document.

We welcome the assurances in the Statement that all those changes will have environmental considerations much in mind. The country would expect that assurance. I hope that when he replies the Minister will be able to confirm that the emphasis on environmental protection in the document is well founded and that both ministries will have that point much in mind.

The last and most important question concerns money. To what extent are the contemplated changes to be met by United Kingdom taxpayers, and to what extent by the European Community for funding from FEOGA? The scheme's objective is to ease the burden of surpluses arising under the common agricultural policy. I should therefore welcome from the Minister an assurance that the burden on the taxpayer will be minimal and that the Community, which is responsible for the surpluses because of its past excessive generosity from FEOGA, will undertake the major part of the burden that is likely to arise from the policies announced.

Lord Mackie of Benshie

My Lords, I too should like to thank the Minister for repeating the Statement which has been made at a timely moment just before the annual general meeting of the National Farmers' Union. I dare say that had nothing to do with the reasons for making it. We have been waiting for a policy statement for some time and at least the Statement contains some good intentions.

I should like the Minister to explain the phrase: This will entail less support for expanding production". I did not realise that the Minister wanted to expand production in this country. I thought that the problem was that we had expanded production too much.

The Minister said: to enourage the development of farm woodlands. Figures have been bandied about. I have not seen the Written Answer. The figure of 30,000 acres a year has been mentioned. That is peanuts in the face of the need to take out of production between 2.5 million and 3 million acres. At least it will be a start. He needs to give us some indication of the thinking, because as the noble Lord, Lord Gallacher, said, a training scheme and an overseeing scheme will be needed. A great deal of money will have to be paid out because with the present state of farming profits no farmer will take a grant to plant trees on a significant portion of his land unless he is guaranteed some income for the 30 years that he will wait before he receives any income from them.

The Minister needs to have some idea that the CAP will provide the money. Every acre taken out of barley, if it grows two tonnes, costs the Government £130 a tonne. They are paying restitution of £100 a tonne—and goodness knows what for storage! The Minister should tell us whether the CAP will supply some of that money. It is a good proposal. We must carry it out; but I doubt whether the Government have thought it out. I should be pleased to be proved wrong.

I shall say nothing about ESAs except that they are welcomed by my party. My noble friend Lady Stedman may say something about them. I hope that agricultural considerations will continue to be taken strongly into account when deciding whether to desginate an ESA.

The business of enterprise on farms is extremely important. At the present time local authorities are not seized of the importance of so doing. Everyone can speak of cases where the authorities have turned down permission for individual craftsmen to use surplus farm buildings for workshops. The direction and guidance there will be very welcome to the local authorities.

Perhaps the noble Lord will comment on the figures that have been bandied about—I understand that some Government spokesmen have said that they are absolute rubbish—to the effect that 85 per cent. of farmland would be available on which the developers and friends of the Government can wreak havoc in areas of up to 100 acres. Surely if we wish to encourage people to live in the countryside care and planning is absolutely vital. Perhaps the noble Lord will be good enough to comment on that.

The Government will again need to reverse money which they have been taking off research right, left and centre. I welcome the reference in the Statement which says: Within my budget for research, development and advice I shall be placing more emphasis on the possibilities". I hope that statement will be backed by money. I am sorry to nark about this excellent little start, but it will need to be backed by a great deal more. We shall look forward to the White, Green or Pink Paper in a month's time. It will need to be a lot more definite than the Statement that we have already had.

Will the noble Lord also explain the words: A healthy rural economy based on enterprise, adaptability and fair competition"? Who is the fair competition to be with? What kind of competition are we talking about? I welcome the Statement and apologise for being a little doubtful about the Government's intentions.

Lord Belstead

My Lords, I am grateful to both noble Lords for their reaction to this Statement. The noble Lord, Lord Mackie of Benshie, has in many ways been generous in what he has said and has welcomed aspects of the Statement. However, in his closing words the noble Lord referred to the Statement as being a small start. We have a situation which has worried this House very much, certainly in the time that I have been working in the Ministry. What is to be done about the ever-increasing surpluses, and is it possible to take some kind of action to grow alternative crops and take other measures to reduce the surplus at the same time?

Here is a Statement which announces for the first time government support for an increase in farm woodlands; government encouragement for an extension downhill in a sensitive way of forestry; a doubling of the environmentally sensitive area programme; splendid government encouragement for the part which we put in the Bill in this House into last year's agriculture Act on diversification grants for farmers; some reduction in the constraints of planning but done in a very careful way; and some more emphasis in my right honourable friend's R&D programmes for research on alternative crops. It is really quite a package.

The noble Lords, Lord Gallacher and Lord Mackie of Benshie, asked me about forestry and farm woodlands. The noble Lord asked me about the locus of the Forestry Commission. The Forestry Commission will provide the planting grants for the new farm woodlands scheme. Of course those grants are good. What is new in the announcement is that there will be annual grants for the growing of trees up to a maximum of £125 per hectare. This will all be in a consultation document. How long those grants will last over the years will also be a matter for consultation. However, for the first time we are providing annual grants for maintenance purposes to get farmers over that period while the trees are growing.

On environmentally sensitive areas, the noble Lord opposite asked whether it will be necessary for everybody to apply again. We hope to build on the existing list which we had from the Countryside Commission and the Nature Conservancy Council. Will there be a good spread? I hope so. We tried to do our best on this with the first five in England, and also in Wales, Scotland and Northern Ireland. Here is a splendid opportunity to add very considerably, I hope, to that spread. This is a matter on which there will be a great deal of consultation with the conservation agencies, the unions and the CLA.

The noble Lord asked me about the Department of the Environment's position in this matter with regard to new planning. Perhaps I may make it quite clear that my right honourable friend the Secretary of State has put out a circular on this matter today. There will be a two-month consultation period. The best land will continue to have protection. At this stage I think that I ought to say no more and that it would be best if we all looked at the circular.

The noble Lords, Lord Gallacher and Lord Mackie of Benshie, also asked me about the policy document. They asked whether it would be white, green, or green with white edges. The words in the Statement are as clear as I could possibly be: I plan to publish next month a document describing how the Government's policies towards farming are being adjusted to reflect the changing scene and potential in the rural economy as a whole". What is so enormously important is what is being done not only through the agricultural departments but also through the Department of the Environment and of course the very important agencies, not least the Development Commission.

The noble Lord, Lord Gallacher, asked me about money. The total cost of this package will work up to being £25 million. Community plans are being worked out at the present time on socio-structural measures. At present it is not possible to say what we shall eventually get for these plans from the European Community. The noble Lord, Lord Mackie of Benshie, said that he hardly understood the words at the beginning of the Statement about concluding that a new balance of policies is needed. May I make this simple point. The noble Lord knows this better than I do. What we have aimed for in these proposals is this. If one can bring trees sensitively planted on to the better land we trust that that will mean less of crops which are in surplus. If one doubles, as we are doing, the environmentally sensitive areas, that will begin to have a real effect on volumes of production.

The noble Lord, Lord Mackie of Benshie, also asked about the amount of land which people keep on saying will not be needed. A huge range of figures has been quoted by different commentators. However, it is clear that several thousand hectares—perhaps several hundred thousand; possibly more than a million—may be looking for an alternative use over the next 10 years. I trust that this Statement of my right honourable friend is a positive step to doing something about that in the future.

Lord Sandford

My Lords, I congratulate my noble friend on at last having begun a process which it was obvious we should have started at least six years ago when we were dealing with the Wildlife and Countryside Bill.

Lord Belstead

My Lords, I thank my noble friend, who has been characteristically generous in what he said. He can be stern sometimes, and there was an element of sternness in what he said. May I simply add this. It was my noble friend, and my noble friend Lord Peel, who persuaded the Government to put Section 22 of last year's agriculture Act into that legislation. I am absolutely delighted that we are now able to take action on that.

Baroness Stedman

My Lords, I also welcome the Statement from the Minister as a very progressive start to some new policies. We all support the small-scale enterprises and the diversification in the use of buildings and such matters.

Can the Minister assure us that the present rural planning and the guidance that will be given will be adequate to protect the environmental side of that expansion in our villages? Can the Minister also give us some encouragement that he may be bringing pressure to bear on the Forestry Commission, in respect of these farm woodlands, to consider our broadleaved hardwood trees, with not so much emphasis on the evergreen policy that the Forestry Commission has been carrying out up to now?

I welcome the further designation of the ESAs. Can the Minister tell us how many ESAs will be designated by 1988 when this extra money is being made available? Does that deal with all the sites that have been submitted for designation up to now, or will there still be some left over after 1988?

Lord Belstead

My Lords, I thank the noble Baroness for what she has said. The noble Baroness has considerable experience of planning. There is no question of opening up the countryside to uncontrolled development as a result of this Statement. As the Statement says, my right honourable friend the Secretary of State for the Environment is providing for what we think is a more realistic look or approach to the giving of approval for the use of redundant buildings and things of that kind in the countryside.

In order to help the splendid work being done by the development commission, by CoSIRA and by ADAS, perhaps I should simply say that the environmental aspect of planning really is not affected by this particular Statement. Perhaps we should all look at the circular of my right honourable friend which is out today and draw our own conclusions.

Yes, there will be more broadleaves. This will happen as sure as night follows day if you bring the planting on to better land or down the hills as some people say. The grants are higher for small patches of land which are planted, and, of course, much higher under the Forestry Commission grant schemes for broadleaves. The proportion of broadleaves is going to be a very important element in the consultations we shall undertake on farm woodlands.

Finally, on environmentally sensitive areas, I regret that I cannot say how many there will be by 1988 for one very good reason. They do cost different amounts of money. For instance, the cost of the ESA which has been designated in Cornwall is of a very different order to the cost probably of most other ESAs so far designated. But I hope the fact that we are doubling the amount of money means that there will be a considerable addition to the nine environmentally sensitive areas designated so far in the United Kingdom as a whole.

Lord Stodart of Leaston

My Lords, may I say what encouragement my noble friend's Statement gives, not only because of its content but also because it has been delivered at a remarkably late hour prior to the opening of the National Farmers' Union meeting, which reassures me as a farmer that the power of the agricultural lobby still exists.

As regards the Statement, may I put a question to my noble friend. A fortnight to three weeks ago, we had a two-and-a-half-hour debate on the alternative uses of land. We had confirmation from my noble friend of what I thought a useful figure. It was that if 10 per cent. of what might be called the marginal land, the 30 to 35 hundredweight an acre cereal land, were taken out of production, this would totally solve the problem. To what extent is it intended that the encouragement of the development of farm woodlands and the planting of a higher proportion of trees on low ground of better quality should meet the amount of land taken out?

Secondly, in talking about low ground of better quality, may I ask what my right honourable friend has in mind? Is he considering grade 3, grade 2, or even grade 1 land? It would be interesting to know.

8.15 p.m.

Lord Belstead

My Lords, with regard to the take-up of land which is not needed for cereal production—as my noble friend quite rightly said, we discussed this in the debate the other day—there is undoubtedly going to be an effect on that problem so far as the proposals announced this evening on farm woodland and forestry are concerned. My noble friend has asked me to specify. We are going to spend up to a maximum of £125 a year per hectare. These are the recurrent grants. There are the planting grants on top of that. There will be a number of payment bands. Three are currently envisaged, because the income foregone from planting trees on agricultural land will vary with land quality and area. The basis for differentiation will be under consideration. All this will be in the policy document and subject to consultation.

We want to see how we go, so that after a short period there will be consideration of how well the programme has progressed. But all this will be firmly in the policy document and there will be plenty of consultation. Therefore, I cannot give a figure as to the amount of land which the woodlands scheme will take up. So far as the forestry is concerned, we envisage that plantings will go up from about 30,000 to 33,000 hectares a year by bringing forestry on to rather better land. My noble friend asked how much better land. That is a matter I should like to come back to on another occasion, when I will try to give an answer to my noble friend.

Baroness Nicol

My Lords, first of all I should like to say how much we welcome the Statement. I should also like to reassure the farming lobby that there are some conservationists who welcome the measures to improve the health of the rural economy, which is absolutely essential.

May I ask the Minister whether he has any information about farm land which is to be released for housing? Some of us are a little worried that this may be excessive, especially in view of the possible scrapping of structure plans, which I understand is about to happen. Can he give us any reassurance on that?

Lord Belstead

My Lords, if the noble Baroness will forgive me, I think both the noble Baroness and I should look at the Department of the Environment circular. I have not had the opportunity to see it myself. It is dated tomorrow, I understand, and it was issued only a few hours ago. If the noble Baroness will forgive me, I feel I cannot answer that question, and I think both she and I should look at that circular, which is now out for a two-month period of consultation.

The Earl of Onslow

My Lords, I should very much like to welcome what my noble friend has said, but it seems that £25 million a year extra for this is but a drop in the ocean compared with the whole problem of agricultural surpluses. Are these sort of plans going to apply Europe-wide? Surely we should ask the European Community, as the noble Lord, Lord Gallacher, said. Hopefully, on export subsidies to wheat they are going to save something in the region of £86 a ton on feed wheat, which is the last export subsidy figure that I saw. Reducing production in Europe should release considerable funds which FEOGA are using at the moment and which should go to increase that £25 million a year. Unfortunately it is very little.

I warmly congratulate my noble friend on the trend. The idea is absolutely right. I know that it sounds mean and unkind to be like Oliver Twist and say it is not enough and ask for more, but I think that is the only way we shall make any serious dent in the surplus problem.

Lord Belstead

My Lords, we may find the money will come from European Community schemes as associated structures measures unfold. There is just one thing I should say about reducing surpluses, with which I know my noble friend is considerably preoccupied. As I am sure my noble friend knows, there is a remit from the Commission that they will come forward with proposals for taking sectors out of surpluses. The British Government have put forward a proposal to the Council of Ministers for trying to take land for cereals out of surpluses. My noble friend Lord Stodart referred to that. My understanding is that the Council of Ministers' meeting in Brussels this week expects to have before it proposals from the Commission about taking sectors out of surpluses. Therefore, this is an area about which we hope to hear more in the near and foreseeable future.

Lord Taylor of Gryfe

My Lords, perhaps I may congratulate the Minister on anticipating the report of the European Communities Committee which will be debated in this House on Tuesday. It may be that some of the comments we have for tonight can be held until we have the full-scale debate on the report of that committee, which is being chaired by the noble Lord, Lord Gallacher, because the committee does in fact argue the case for taking more agricultural land into forestry.

I should like to ask the Minister one or two questions. First, I welcome his commitment to an expansion of forestry. However, is it not somewhat inconsistent with that commitment to continue to sell off the Forestry Commission estate when in the past it has been the partnership in forestry between private and state sectors which has been the greatest stimulus to forestry development in this country? Indeed, it has been a very happy partnership.

Secondly, will the Minister tell us a little more about the grant structure as regards the encouragement of hardwoods, keeping in mind that softwoods have almost a 30-year rotation and hardwoods a 100-year rotation? What kind of financial incentives will be provided, keeping in mind that investment in forestry only yields a 3 per cent. per annum return according to the internal audit report? What kind of structure and what kind of incentives will back the new commitment to the expansion of forestry?

Although the Minister has said in the Statement that there will be future planning requirements for agricultural land, will he give an assurance that he will resist hysterical pressures regarding forestry development? It would be an impediment to the expansion of forestry for which he has argued today if it were to become involved in local planning procedures when it has a perfectly adequate system at the moment.

Finally, the BBC said tonight that the Minister for Employment had not been too happy about the Statement because it lacked substantial employment implications. Will the Minister comment on that statement in the news?

Lord Belstead

My Lords, the noble Lord, Lord Taylor, has almost unrivalled experience in the field on which he has chosen to ask me questions. I shall do my best to answer.

The first question the noble Lord asked was why, when we have a forward-looking Statement about forestry, we are involved in sales of Forestry Commission land? This is a rationalisation. The noble Lord will know that very often the commission has taken the opportunity to sell off parcels of land which have been on the peripheries of its planting. This evening I shall simply content myself by saying that it is a rationalisation, although a substantial one.

The noble Lord asked whether the planting grants will be so attractive that people will go for broadleaves. If one is planting 10 hectares or over, the planting grants are approximately doubled if one plants broadleaves as compared with conifers. If one is talking about farm woodlands there are to be these first ever grants of up to £125 per annum for an ongoing period. This will all be considered in the consultation document.

Lastly, the noble Lord said that we should keep planning out of forestry. As regard the uplands, that is exactly what we set out to do when we responded to the uplands report about a year and a half ago.

Lord Kilbracken

My Lords, when the Minister spoke of £125 per year, did he mean £125 per hectare per year?

Lord Belstead

My Lords, yes.