Farm Land and Rural Development Bill [H.L.]

HL Deb 05 November 1987 vol 489 cc1086-132

Baroness Trumpington

My Lords, I beg to move that this Bill be now read a second time.

Compared with most of the Bills that will be coming to your Lordships' House this Session, this is a small Bill; but, in my view, small is beautiful and the measures contained in the Bill are of importance to farmers and the agricultural scene of the future. I know that very many noble Lords take a keen personal interest in rural affairs and have considerable experience in matters such as woodlands, and I am therefore opening this debate with a little nervousness, mixed of course with pleasure. Perhaps I may add that my pleasure is increased by the fact that my noble friend Lord Borthwick has chosen this Bill as a vehicle for his maiden speech.

Let me first place this Bill in the context of the Government's policies for the countryside. Although the details of the schemes will be set out in secondary legislation, they are not strictly the subject of today's debate. Nevertheless, today I can give you some information which I hope will assist your Lordships in consideration of this Bill.

As background to the Bill, I should like to remind your Lordships of a Statement made on 9th February this year by my right honourable friend the then Minister of Agriculture, and repeated in this House by my noble friend Lord Belstead. In his Statement he said: With the European Community now producing surpluses in many of the main agricultural commodities, a new balance of policies has to be struck, with 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". My right honourable friend the Minister of Agriculture in another place went on to announce a series of initiatives which the Government were taking to assist the process of change, which were spelt out in more detail in the farming and rural enterprise package published on 10th March. Those included proposals for a farm woodland scheme; an expansion of the traditional forestry programme with a higher proportion of planting on low ground of better quality than hitherto; an increase in the number of environmental sensitive areas; a scheme to encourage diversification of enterprise on farms; greater emphasis on the possibilities for novel crops in the Ministry's budget for research, development and advice; and parallel changes in the policies of the Secretary of State for the Environment.

The Government have since taken steps to implement all of the measures in that package for which powers already exist. The purpose of this Bill is to provide powers for us to implement the remaining measures; in particular, the making of a scheme to assist the marketing of the products of diversified farm businesses and the making of a farm woodland scheme.

This brings me to the content of the Bill. Clause 1 provides powers for agriculture Ministers, with the approval of the Treasury, to make a scheme of grants in respect of certain farm businesses carried on ancillary to agricultural businesses for any one or more parts of Great Britain. An Order in Council can be made under Schedule 1 to the Northern Ireland Act 1974 (c.28) enabling the Secretary of State for Northern Ireland to make a similar scheme there. Such a scheme may provide for the payment of grant towards expenditure of a non-capital nature incurred in the establishment, expansion and promotion of a farm business and in the marketing of its goods or services. The clause also enables Ministers to lay down provisions in the scheme regarding the conditions under which grants may be made and confers discretion on Ministers as to approvals and the amounts and timing of payments.

Clause 2 of the Bill provides powers for agriculture Ministers, with the approval of the Treasury, to make a scheme of grants in respect of farm woodlands for any one or more parts of Great Britain. Such a scheme may provide for the payment of grants to owners and lessees of land towards, first, expenditure incurred or to be incurred in the conversion of agricultural land to woodland; for simplicity, I shall use the term "planting grants", which is what we are talking about; and, secondly, towards abating any financial loss resulting from that conversion. These grants may continue over a period of years during which no income could be expected from the land in question. Again, for simplicity, I shall refer to them as annual payments.

As in the case of Clause 1, this clause enables Ministers to lay down provisions in the scheme regarding the conditions under which grants may be made and confers discretion on Ministers as to approvals and the amounts and timing of payments. The clause as a whole relates only to Great Britain, because the Secretary of State for Northern Ireland already has the necessary powers to make both the kinds of payments that I have described. This means that any scheme will be able to apply throughout the United Kingdom.

Clause 3 of the Bill is intended to increase the limit on the maximum number of members of the Development Commission from eight to 12. The increase would facilitate the merger of the Development Commission with its main agency, the Council for Small Industries in Rural Areas. This was announced as part of the Government's rural enterprise package earlier this year and is expected to come into effect on 1st April 1988.

Having briefly described the background to the Bill and its contents, I should now like to turn to the details of the two schemes which the Government would propose to implement once the Bill becomes law. Both the schemes were the subject of consultation with interested parties earlier in the year. The many helpful responses we received have been fully considered and our revised proposals have been drawn up in the light of that consideration.

The first scheme concerns the provision of grants for diversifying farm businesses. We attach importance to the introduction of this imaginative new scheme. It will encourage farmers to find alternative sources of income apart from the continued production of surpluses. Opportunities will be opened up for on-farm employment. New businesses will add to the vitality and diversity of the rural economy.

The core of the new scheme will be a capital grant scheme which will be made under powers obtained under the Agriculture Act 1986 following an amendment made, as some of your Lordships will recall, during the passage of that Act through this House. We hope to lay statutory instruments before the House soon containing details of the scheme, but I am sure it will be useful for your Lordships to know now broadly what is intended.

As many of your Lordships know, capital grants for a limited range of craft and tourism investments on farms have been available in the less favoured areas since 1985. The new scheme will extend this assistance by making grants available without geographical restriction and for a much wider number of activities.

There are many business activities open to the farmer with true entrepreneurial talents. Some are already grant-aided by other agencies. Others can be privately financed. Our scheme will be targeted on small to medium businesses and on activities which arise naturally on the farm. We intend to aid tourist accommodation of a good standard, including camping barns which provide basic accommodation for walkers and which are attracting particular interest; also leisure, recreation, amenity and sporting facilities for visitors and the catering facilities that go with them. Value-added processing of food and other farm products and timber will also be aided, as will craft work shops together with farm shops to sell the products of the farm business. And for the first time, too, we plan to give some assistance to businesses involving horses; in particular those concerned with the provision of livery and, in the uplands only, accommodation for horses for hire. I am sure that your Lordships will welcome these proposals when we formally lay them before you.

The scope of the Agriculture Act 1970 is not, however, wide enough to permit non-capital grants to be made to diversified farm businesses. Such grants are, I believe, necessary to encourage producers to plan ahead and to investigate thoroughly whether a new business would be viable and, not least, to consider the implications it would have for the existing agricultural business. Above all, it is vital that a proper assessment is made of the market potential for the proposed product or service.

At the other end of the production line, diversified farm businesses need to market their products and services so as to ensure that the needs of the customer are met, in terms of both quality and continuity of supply. We therefore believe that some pump priming is justified to encourage producers to adopt a sound and competent approach to marketing.

Clause 1 of the Bill will permit Ministers to introduce a scheme of grants towards the cost of feasibility studies, market research and the marketing of products and services across a range of diversified farm businesses. These non-capital grants will be complementary to the capital grants, will have broadly the same conditions of eligibility and will cover similar farm-based activities.

For feasibility and market research studies, we are proposing a 50 per cent. grant. As I have said, such studies may also investigate whether changes are necessary to a producer's agricultural business to enable him to expand or establish an ancillary farm business. Before agreeing to pay these grants, Ministers will need to be satisfied that the person undertaking the study is competent to do so and that all aspects of the proposed business will be analysed fully.

The consultation document proposed a flat rate of 30 per cent. over three years for marketing grants. In the light of comments made on the consultation document, we are considering whether a degressive scale of grants may be more appropriate in order to give a greater incentive in the first year. We will announce revised rates when we have discussed this further with the EC Commission.

The consultation document proposed an annual ceiling on grant of £2,000 for individuals and £5,000 for groups. In the light of subsequent comments, we are looking at these limits again. The ceiling will apply separately to the various types of grant available.

We have decided that the non-capital grants scheme will be subject to prior approval for two reasons. First, although the literature about the scheme will describe the broad requirements for the content of, for example, feasibility studies, it will not be able to take account of the detailed conditions prevailing on any particular farm. As the enterprise to be studied may well be very unfamiliar to the farmer, it would not be reasonable to expect him to commission a study without some advice and confirmation that his proposals would be acceptable for grant. Similar considerations apply to the marketing grants.

The second reason for prior approval is to assist with the monitoring and control of expenditure. However, I should emphasise that we intend that the approval procedures should be as simple as possible. We do not want to impose an unnecessary administrative burden on farmers or agricultural departments.

Subsection (1) of Clause 1 provides for the scheme to specify which types of farm business will be eligible and I have already indicated those which we intend to include. Your Lordships may wish to note that we intend to assist the expansion of diversified farm businesses as well as the establishment of new ones.

Subsection (2) of Clause 1 enables the scheme to specify such matters as the eligibility of applicants. For individuals the eligibility criteria will be the same as those for capital grants. However, in the case of groups we propose that only 75 per cent. of the members will need to satisfy the full criteria, but all members will have to have an agricultural holding number. This will ensure that worthwhile group developments are not excluded from grant simply because a minority of members do not qualify.

Subsection (2) also confers a discretionary power on Ministers to allow them to refuse new applications or to give priority to certain businesses or types of grants. The subsection also provides for the scheme to include terms and conditions of payment of grants such as a requirement for the applicant to carry out the proposal as approved and for accounts to be available to the agricultural departments for inspection.

In regard to advice, producers will be able to have the benefit of general advice from the rural enterprise adviser on diversification possibilities and on government help for them free of charge. Working up the details of a specific project will be a chargeable service.

I come now to the details of the farm woodland scheme. Our consultation document issued on 10th March proposed a system of annual payments, additional to Forestry Commission planting grants, designed to help bridge the gap between planting and the likely first income from the thinning of timber. It was proposed that the rate of annual payment should vary according to land categories in order to reflect the fact that lesser incentives are needed to take poorer land out of agricultural production. Three rates were proposed: £30 per hectare in the severely disadvantaged areas, also known as the original less favoured areas; £60 per hectare in the disadvantaged areas, otherwise known as the new less favoured areas; and £125 per hectare elsewhere, for example mainly in the lowlands.

The consultation document also set out various scheme conditions for comment. Finally, it made clear that the first three years of the scheme were to be experimental. In the first year a maximum of 12,000 hectares would be accepted. Limits in the second and third years would be decided in the light of uptake of the scheme, but there would be an overriding limit of 36,000 hectares over the first three years.

Now let us look ahead to the scheme we are actually hoping to introduce next year. The first and most important change concerns the target land for planting under the scheme. The scheme as originally proposed would have attracted planting on to the most marginal land available in each of the three proposed zones. The point was made in response to consultation that there was a danger that this would do relatively little to reduce surpluses, which is our primary objective. Many environmental organisations also expressed concern that planting of such marginal land might lead to the loss of valuable semi-natural habitats, particularly in the lowlands.

The Government have therefore decided that the scheme should concentrate on so-called improved land. This would be done by restricting eligibility to arable land and grassland up to 10 years old; that is, grassland which has been cultivated and reseeded within the previous 10 years. Most farmers have some land of this kind.

Because such land is more productive than originally envisaged, higher rates of annual payment would be justified. We are therefore proposing rates of £100 per hectare in the severely disadvantaged areas, £150 per hectare in the disadvantaged areas and £190 per hectare in the lowlands, in respect of arable and improved land only. We shall, however, be sticking to the target of 12,000 hectares a year and the overall target of 36,000 over three years.

However, because there is proportionately less improved land in hill areas—and this applies particularly in Scotland and Wales—the Government have decided that within the overall target of 36,000 hectares over three years, some 3,000 hectares will be allocated for unimproved land planted in the SDA and DA. This would allow some hill farmers to plant woodlands in areas of permanent pasture or rough grazing, provided that the land had been in productive agricultural use. The rate of aid for all such planting would be £30 per hectare, as originally proposed for the SDA, recognising the minimal CAP savings that would accrue in such areas and the fact that some farmers will be able to plant on improved land and attract the £150 rate in the DA and the £100 rate in the SDA. All the rates of aid under the scheme would of course be reviewed from time to time in the light of relevant factors.

We are also anxious to give encouragement to mixed woodland containing a high percentage of broadleaves. Such woodland offers both silvicultural and economic benefits in some cases and can be a good way of establishing an eventual pure broadleaf plantation. We therefore propose to extend the payment period to 30 years for mixed woodland containing more than 50 per cent. broadleaves. In addition, we intend to introduce an even longer payment period of 40 years for pure oak and beech planting since these traditional species take longer to mature. The payment periods will therefore be: 40 years for pure oak and beech; 30 years for other broadleaves and for mixed woodland of which more than half is broadleaved; and 20 years for other woodland.

We have also decided that the planting of new trees for traditional coppice rotation should be eligible for the scheme, provided that it qualifies for Forestry Commission planting grants. Because of the earlier returns that can be expected from coppicing, the annual payments would only continue for 10 years. Shorter rotation coppice for energy uses would not be eligible.

I should emphasise to your Lordships that the extra incentives which I mentioned for broadleaf planting would be additional to and reinforce the higher rates of planting grant already payable for broadleaves. For a wood of three to ten hectares the planting grant under the broadleaved woodland grant scheme is currently £800 per hectare, whereas the corresponding rate for conifers under the forestry grant scheme is only £420 per hectare.

A number of consultees urged us to impose compulsory minimum proportions of broadleaves that would apply to individual applications. We are not persuaded that such a step is necessary. It is true that in past years much of the traditional forestry planting in the United Kingdom as a whole has tended to be coniferous. But in England where most planting takes place on lower land, 64 per cent. of private sector planting last year under Forestry Commission grant schemes was of broadleaved trees. We remain committed to the aim of achieving at least one third broadleaves under this scheme, and we take the view that the targeting of the scheme on better quality land and the incentives it provides for broadleaf planting will enable us to achieve this aim without compulsory minimum proportions. Moreover, sensitive planting will be encouraged in our advisory literature and the actual planting under the scheme will be closely monitored so that action can be taken if the broadleaf proportions fall short of what we expect.

On the minimum and maximum areas per holding, we now propose a maximum of 40 hectares per holding throughout the UK. The woodland will have to form part of the applicant's farming operations and so afforestation of the whole holding will be ruled out. The minimum per holding will be three hectares, except in Northern Ireland where the average holding size is much less and so the minimum plantation will only be one hectare per holding. The minimum size for each block of woodland will remain at one hectare. The logic of this is to ensure that farmers take sizeable pieces of land out of production.

In drawing up these proposals, we have been concerned to try and simplify the scheme as far as possible and to keep administrative costs to the minimum. To this end, we have decided to reduce the amount of consultation with local authorities on planting of farm woodlands where small areas are involved, particularly on improved land. On larger areas, perhaps of over 10 hectares, consultation continues to be appropriate because of the possible landscape implications. Existing arrangements would, however, continue in national designated areas such as Sites of Special Scientific Interest, Environmentally Sensitive Areas, national parks in England and Wales and national scenic areas in Scotland. National nature reserves will be excluded from the scheme altogether. My right honourable friend will want to discuss the details with representatives of local authorities. But change in the consultation arrangements is needed to save money and speed up the processing of applications which will make the farm woodland scheme more attractive.

Although, as I have said, we are concerned to keep costs down, we shall be allocating some additional manpower to this scheme both at the Forestry Commission and within the agriculture department's advisory services. For many farmers this will be their first venture into woodlands and good advice will be essential to ensure that the investment in young trees is not wasted. As for diversification, general advice from ADAS will be free, but detailed work on a project will be a chargeable service.

On the subject of young trees, the Government are particularly conscious of the need to obtain adequate supplies of nursery stock for planting under the scheme. My department and the Forestry Commission have had a number of meetings with the Horticultural Trades Association on this subject and will be continuing to liaise closely with nursery growers. We shall be doing what we can to ensure that enough young trees are available and that they are of good quality stock and, as far as possible, supplied from domestic sources. I am fully aware of the difficulties caused by the recent storms.

Finally, questions have been raised about landlord/tenant issues in relation to the scheme. The Government are keen that tenant farmers should be able, with their landlords' agreement, to participate in the scheme. Discussions have been taking place between representatives of the National Farmers' Union, the Country Landowners' Association and the Royal Institute of Chartered Surveyors on the best way to achieve this. We understand that agreement has been reached on all the fundamental points and that model clauses are being prepared for inclusion in tenancy agreements under the Agricultural Holdings Act and for use in model forestry leases where a separate long lease seems more sensible. The Government very much endorse this voluntary approach, since agreement between landlord and tenant is sensible on a long-term enterprise of this kind and we should not embark lightly on changes to the landlord/tenant legislation. This represents a careful balance of interests and, only relatively recently, was amended and debated at enormous length in Parliament. We shall, however, exclude from the scheme land that has been taken back into hand by a landlord for forestry under a tenancy agreement resumption clause.

Forestry, and particularly farm forestry, is an important use for surplus farm land. Wood is one of the few crops that can be grown on all but the bleakest and wettest land, and I am told that Britain has an advantage in timber growing conditions over most European countries. Some have criticised our proposals for not going far enough, given the land use problem that we may have to face. I would simply say two things in answer to that.

First, this is an experimental scheme and will be closely monitored. This is surely a sensible way to proceed when we do not have an established tradition of farm forestry in this country as they have in, say, France and Germany. Secondly, although 12,000 hectares may sound a relatively small area, the number of trees needed will not be small. If planted at a conventional forestry spacing of two metres apart, 2,500 trees are required for every hectare planted. This equates to 1,000 trees per acre. That would mean a total of up to 30 million trees per year if farmers succeed in planting the full target area. Even with the losses of mature trees which we have sustained through various causes, including Dutch elm disease and the recent storms in the South-East, on which the Government are taking separate, urgent action, I do not accept that the planting of 30 million trees per year could be described as inadequate.

I apologise for having explained our revised proposals for this scheme at some length. I hope I have not presumed too much upon your Lordships' interest in these matters. But the Government attach considerable importance to this scheme. We have proposed re-targeting the scheme towards better land so that it makes a greater contribution towards the reduction of surpluses and Exchequer expenditure in line with our efforts elsewhere to bring more sense into the common agricultural policy. We have proposed higher rates of payment to make the scheme more attractive to farmers. We have enhanced the environmental benefits it will bring by the changes we have made. The director general of the Royal Society for the Protection of Birds recently commented as follows: Planting trees on wheat fields or improved grasslands would bring diverse wildlife benefits. A wide range of broadleaves and conifers will grow on this richer land, enhancing the landscape, providing high value timber for the farmer, and giving local fuel, shelter and sporting benefits too". I shall only add that the contribution which the new woods that will be established will make to our countryside should be additionally welcome after the disastrous damage inflicted by the storms last month. To sum up, I repeat that this is a small but important Bill. I should simply like to commend it to your Lordships for approval and beg to move that it now be read a second time.

Moved, That the Bill be now read a second time.—(Baroness Trumpington.)

4 p.m.

Lord John-Mackie

My Lords, I find it difficult to make a start in this matter. When the Minister began to speak, she emphasised that this is an enabling Bill. When she took over her present job, she jokingly came to me and said, "You won't be too hard on me until I find my feet". I do not think that is required. But I must tell her here and now that the armistice is finished.

The Minister said that she hoped she was not presuming. She is presuming with a capital "P". I started to take notes as she spoke in order to reply to some of the points she was making. However, with such a wealth of detail, she has almost moved to the Committee stage of the Bill. It is quite unacceptable that the House should have all those details before it without having seen the Bill in print, other than in a broad way. I hope the noble Baroness will take note of what I am saying. Personally, I am going to treat it as the Second Reading of an enabling Bill, making one or two points on the way.

Clause 1 is definitely an enabling clause. It is full of bureaucratic language. That is necessary, I suppose, to cover all eventualities although some of it requires reading a few times before it is possible to understand what on earth it means.

Clause 1(1) applies to expenses for feasibility and market research studies. This is very necessary. Farmers should be careful before they enter into new projects which they do not know enough about. They should be able to make a study of them. If a scheme is large and particularly if it relates to something which one has to sell, it can be very expensive. Having gone into a scheme and found that it is not workable, would the grant still be paid? I believe it could be very expensive.

I believe that the phrase, "has been or is to be incurred" requires an explanation. The noble Baroness made a point regarding prior approval of a scheme. Does that also apply to the grant because it is mentioned in the clause relating to woodlands as well? As the noble Baroness knows, with grant schemes for improving buildings prior approval is not necessary. I wondered if this was the same.

Can the noble Baroness explain Clause 1(1)(b)? It is not clear to me what it means. The official language in subsection (2)(d) is also very difficult for a layman like myself. I have no doubt that lawyers can deal with it. Subsection (2)(g) says that different provision will be made for different cases. Does this mean a wide range of different grants for all sorts of different schemes? I consider it will be a major task to sort that out. The question I ask is: who decides this?

As the noble Baroness pointed out, Clause 1 is there to encourage diversification of grants. On change of use of farm buildings and farm houses, I believe the noble Baroness mentioned turning barns into tourist attractions and so on. This may encourage a dairyman to go out of milk and use his buildings for another purpose. I know of one farmer who has turned his buildings into livery stables. But, on the whole, there is bound to be little effect in regard to taking land out of farming.

I do not know whether this will qualify for a grant but two farmers at the bottom of my road have applied for planning permission to build a golf course. Unfortunately, my golfing days have finished and I will not gain any benefit. I wish to emphasise that diversification will have very little effect on crop surpluses unless, as I have said, some people go out of milk.

Clause 2 deals with the grant to plant and manage trees. No one can deny the necessity for more trees in Britain. The demand for timber is increasing as the forests of the world are cut down at an appalling rate—a rate of over 50 acres a minute according to my calculations. Every year we spend on wood and wood products something approaching £5,000 million. No one can deny the necessity for trees but, my Lords, there is a very big "but". The noble Baroness, in the latter part of her speech, tried to incorporate this question with that of taking land out of production. The immediate problem, as everyone agrees, is that of reducing surpluses. But it is simply not practical to join the two issues. It will have a very niggling effect on surpluses.

Various figures have been quoted of how much land should be withdrawn. A figure of 3 million acres has been mentioned. The noble Baroness mentioned a figure of about 30,000 hectares. But the figure of 3 million acres and more of productive land which should come out of production at once has arisen.

Baroness Trumpington

I do not think I said 3 million acres.

Lord John-Mackie

I said 3 million acres and the noble Baroness said something like 30,000 acres, which is a big difference.

I have consulted nurserymen employed by the Forestry Commission. I am told that there are simply not enough tree plants available. It takes quite a while to produce a tree plant because the seed has to be collected and put into a nursery. I understand that the minimum period is two years. Generally, it is three to four years. I believe that we have to reconsider this question.

The noble Baroness quoted a large number of figures. I tried to make a note of some in order to speak about them. Unfortunately, she mentioned too many. I wonder if any farmer with grade 1 or 2 land will ever go over to trees. The grant to tempt him into tree production on that type of land would have to be enormous. I have worked out from the figures the noble Baroness has quoted that the highest grant is £80 per acre which simply will not tempt anyone to produce trees. I doubt whether even on grade 3 land it would tempt many farmers. It may tempt a few but not very many.

There is room in the lowlands for more deciduous trees but this would apply only to small areas; for example the corners of farmers' fields on grade 1 and 2 land and in the renewal of old and badly managed woodlands.

The growing of conifers and deciduous trees on marginal land and in the uplands is a different kettle of fish. There is room there for more trees and for farming. I saw many examples when I was at the Forestry Commission, including the development of forestry on big hill-land farms. One of the best examples I have seen was on the land of the noble Duke, the Duke of Buccleuch and Queensberry, in Dumfriesshire. He had gone into partnership with his tenant to develop forestry on the farm and to build roads to serve the forestry. The whole thing was a tremendous advantage to the farmer. It was agreed to be a great advantage. That was on a large scale.

I saw also a farm in Wales of approximately 200 to 300 acres consisting of a little hill land and the rest semi-arable. The farmer had developed forestry on a small scale and it was a tremendous advantage to him not only for selling trees but also for firewood and for his own fencing and so on. It can and should be done. There has always been an antipathy to forestry, but farmers are now beginning to take a different view and there is no doubt that this scheme should help.

Again, it will have a minimal effect on surpluses. Surpluses are not coming from that quality of land at all. I feel that any effort to replace cereal production, in particular with trees, is a complete non-starter. Taking large areas of productive land out of production permanently should be looked at very severely. Sir Kenneth Blaxter, the former head of the Rowett Research Institute, in an article on world food production in The Lancet this spring makes this very clear. He points out that to feed a population which will be 6,000 million by the end of this century, and probably around 7,500 million in the following 20 years, will require—and I should like noble Lords to think on this figure—a 2.5-fold increase per unit area of land in food production.

I quote his conclusion in the article: Its divisions"— that is, divisions of states and so on— may well mean that what is possible cannot be achieved and that hunger will continue to be the lot of many throughout the years to come". We should think on that. Surely it is a grave warning that we should heed before we take land permanently out of food production, particularly by planting deciduous trees on grade 1 and grade 2 land.

Before I conclude I should like to say something about environmental issues. I have crossed swords with environmentalists quite a lot in my time, in one way or another. I get on with some and I do not get on too well with others. However, they seem to be looking forward. From letters I have received, articles I have read and statements that have been made, they believe that reducing production and planting trees on farms will create a countryside bereft of farming activity, open to all and sundry to wander on at will.

The Guardian newspaper had an article along those lines, complete with a photograph of a derelict farmhouse surrounded by a few scrubby trees and a neglected garden. The caption refers to a battle that threatens the tranquillity of the farm in Wales. It is appalling to think that papers as responsible as the Guardian should put that across. If that is what the environmentalists want in our farming, they will have to think again. I have that photograph, if noble Lords wish to see it.

I believe that the environmentalists have a case in many ways for access to the countryside, but they cannot ask, as the Ramblers Association asks in a letter to my noble friend, for complete access to the countryside. If we are going to farm and produce food, that simply cannot be. On my farm in Essex, which is only 22 or 22½ miles from here, we have five footpaths entering the farm from different sides and I have never yet seen it overcrowded. I have never seen anywhere without plenty of room for the environmentalists to enjoy the countryside without asking for this wholesale access.

Naturally we give our blessing to this Bill and its essential main issues. However, I hope that your Lordships will take note of what it may or may not do to the surpluses that it is so important we get rid of at present.

I took a few notes of what the noble Baroness, Lady Trumpington, said, but we will have another opportunity either in Committee or at a later stage to go into the detail, which in my opinion it was very wrong to bring forward today.

4.5 p.m.

Lord Walston

My Lords, at the outset I associate myself very much with the opening remarks of the noble Lord, Lord John-Mackie. I am sure that the noble Baroness, Lady Trumpington, made her speech with the best of intentions and had no desire to weary us with a great many details. However, I feel that on Second Reading of a Bill which is a purely enabling Bill, it is not necessary to go into details of the density of planting proposed for certain trees and many other similar details which are of importance—but not on Second Reading. I say that particularly in view of the debate we had yesterday on the need for speeding up proceedings in this House. I hope that the noble Baroness and her colleagues will bear that in mind.

Having said that, I hope I will not unduly surprise the noble Baroness when I say that we on these Benches consider this a good Bill, a useful and a moderately important Bill. However, as I said, it is a purely enabling Bill and whether it is going to be an effective Bill depends entirely on how its provisions are implemented.

I agree with the noble Lord, Lord John-Mackie, and with his warnings. So far as one can understand from the Bill, from what the noble Baroness said and some of the accompanying literature which her department has produced, it really cannot claim to be a serious attempt to cope with the problem of surpluses in this country and in the Community.

The attractive document produced by the Ministry of Agriculture called Farming UK says in its introduction, having set out the various objectives which are contained in this Bill, that the Government will make provision, building up to £25 million a year in a few years' time. If that is all the Government are proposing to devote to implementation of this Bill, while one cannot mock at it one cannot seriously pretend that the expenditure of that sort of money and the taking out, if the Government succeed in their intentions, of 36,000 hectares—I think that was the figure the noble Baroness gave—partly marginal land, partly less favoured land and partly grade 1 and grade 2 land, will do more than nibble at the problem.

Perhaps the noble Baroness, Lady Trumpington, will be able to tell us what is the surplus production of grain—we confine ourselves to grain for the moment—within the Community at present. My own feeling—I have not been able to check the figures and I may be wrong—is that it is in excess of 10 million tonnes per annum. I believe it may be rather more than that, but perhaps the noble Baroness can give the correct figure.

If that figure is approximately correct, as we produce about 20 per cent. of the whole cereal production of the Community our contribution towards reducing the surplus should be 20 per cent. of 10 million tonnes, which is about 2 million tonnes. If 36,000 hectares are taken out and if the average yield of those is about five tonnes per hectare, that is under 200,000 tonnes if my mathematics are correct.

Two hundred thousand tonnes out of 2 million is not really a very significant contribution. I have only put forward these figures to show that however good the intentions of this Bill may be—and they are good and they are right—it cannot make any significant contribution towards solving the problem unless its present scope is enormously increased. Perhaps the noble Baroness will be able to tell us that this is just a trial run and that if it succeeds it will be greatly increased within a few years so that we really can cope with these matters. I would ask her to say what scope she thinks will arise when it is found to work well.

One point that must be borne in mind is what is needed to persuade farmers to give up cultivating some of their land. What many people do not take sufficiently into account is the large proportion today in farming taken by the standing charges that there are for every acre. If, as a farmer, you reduce your acreage by 10 per cent. you still have to pay somebody your rent, if you are a tenant, or pay interest on your mortgage, unless you are one of those rare people with entirely unencumbered land.

You cannot get rid of 10 per cent. of your labour force—you probably have only one man—and you cannot get rid of 10 per cent. of your one tractor or your one combine, and so on. All your standing charges remain, and they may well be anything up to 80 per cent. of your total costs. So those have to be met before you can persuade farmers to do something different, because the variable costs do not come to much more than 20 per cent. or 25 per cent. of the total costs. That is an essential factor to be borne in mind in any attempt to dissuade farmers from cultivating every acre they have at their disposal.

Clause 1 is a good clause. I remember what I said at the beginning of my speech about going into too much detail, and I am not trying to get more detail out of the noble Baroness at this stage; but I think that we must know more about the type of arrangements the Government have in mind if they are trying to persuade farmers to go over to different activities.

Are they going to be paid the capital grants which will continue, and, if so, what type will they be? Will they be grants, for instance, to assist in the making up of roads so as to leave picnic sites to encourage town dwellers to go and picnic there? Will they go as far as that type of thing, and what form of liaison will there be between the Ministry of Agriculture, which makes the grants, and the local authorities, which give planning permission?

One could get into a rather embarrassing position where the Ministry of Agriculture says, "By all means renew your buildings so as to have a farm shop or in order to have ponies there or to make parking space for picnickers" and the local planning authorities say, "Not on your life: we do not want any new buildings, extensions or alterations". That is surely quite an important matter which has to be looked at before this Bill can be implemented.

I do not think the noble Baroness dealt quite fully enough with the forestry aspect. I was glad to hear from her that it looks as though agreement has now been reached between those representing the tenant farmers and those representing the landlords. There are clearly some difficulties there, as indeed there may be with the various improvements also made under Clause 1, where tenancy agreements may not allow the sort of development which is considered correct and desirable under this Bill.

A further point under both Clause 1 and Clause 2 is the enormous importance of access to the countryside. I hope that my noble friend Lord Hunt will have something to say about that and about the environment in general. But there must be the closest possible liaison between those who are concerned with the protection and the enhancement of the environment, access to the countryside, the preservation of wildlife and the encouragement of more wildlife and those who are encouraging forestry, picnic sites and so on.

It must be borne in mind that forestry is not always the friend of wildlife. Much is said about the advantages of having more woodlands and the fact that birds like them; but quite a lot of birds are not very keen on woodlands, even of the hardwood variety. Also, there are quite a lot of predators on wildlife which do like them. So you must have close co-operation with the Countryside Commission, the Naturalists Trust and all those concerned with the protection of the environment as well as those engaged in the opening up of the countryside to the urban population.

Finally, with regard to Clause 3 I should like to pay tribute to the admirable work done by the Development Commission. I hope the fact that there are going to be additional members of the Development Commission means that there will be additional funds for it and that it will be able to do more of the very useful work it is doing at the present time. Simply adding to its numbers is not enough in itself, but I hope we can be assured that the increase is a symbol of the importance the Government attach to the commission's work, because if this Bill is to be implemented, as we all hope it will be, undoubtedly the work of the Development Commission will be greatly expanded.

I repeat what I said at the beginning: the Bill itself is a very useful one. It will make it possible for the Government to do the right things. We hope that they will make the fullest possible use of this measure and that the Treasury will not be a brake on what they are able to do and I am sure would like to do.

4.18 p.m.

Lord Borthwick

My Lords, being both a farmer and a forester, I have found the Bill very interesting. After the 1914 and 1939 wars large areas of Scotland and England, and I believe of Wales too—unfortunately I have not been able to visit Wales for many long years but I hope to do so again fairly soon—were planted up. In many areas the planting has grown into substantial forests. They have covered big areas of land with rather bleak-looking timber. Looking at it from the hilltops I would call it "mono-coloured gloom". It does not look very interesting; it is not a very good habitat for animals.

I hear that people want to see more of nature. I think that many of these areas need covering round the edges. If you want to help nature, you have to give nature cover. These woods have no cover. They are tall timber and the winds go right through them. They could be made into good cover by planting the edges. I have tried to do that for sheep cover now and again for lambing and so on. It is quite successful and it also is useful natural cover. I have rather gone away from some of the notes that I made so I shall get back to them again.

When those areas are planted with trees and shrubs, it makes them pleasant for visitors and the natives alike. If the right shrubs and bushes are chosen, we can feed the wildlife in summer and winter, besides creating build for hill stock, which is essential for the farmers who are left.

The Bill seems to be tailored more for smallholders, crofters and family farms rather than for the larger variety. I shall be interested in the Minister's opinion on this matter. It may be claimed that this type of protection is already covered by some other Act.

I notice that Clause 3 increases the number of development commissioners from eight to 12. In most councils one finds that the more members there are, more talk and less work is the result. But in this case, if the extra members are to help the locals by supervising the scheme and help with their technical knowledge as fieldsmen and not as chairborne pontificators, I shall agree wholeheartedly with the proposal.

I should like to ask some of the questions that went through my mind when I heard noble Lords speaking about this matter before. I did not realise that this proposal would apply also to Northern Ireland. If there is a similar scheme in Northern Ireland, the military must be brought in. That is important, and any soldier will understand that. We must watch how we plant timber in dangerous country.

Farmers are good producers, but they are not always good salesmen. What is one to do with a wood once one has it? There are many stories about that, but they are not satisfactory. Some years ago, after one of my first thinnings, I could not sell my timber. Eventually I obtained a sale. It cost me about £1.35 a tonne to sell it. I decided that that was not a good idea, and so I kept it for two or three years. That did not improve the forest much but it improved my price, because I received a little more for it at that time. The timber went to Sweden. It was pulped there and came back to produce the Morning Times, or whatever it was. That is rather unnecessary. I think things have become a little better now. Two large mills are coming and the timber should be saleable. We must also watch out for saleable types.

Oak has been mentioned. That presumably means English oak. I think that the quicker and easier oak to sell is probably the Turkish. I am not in the trade, so I do not know. The Turkish oak is a fine oak. Furniture-makers think English oak is much better. The best oak of all of course is the Irish. It is mild and beautifully marked for cabinet-making.

I also know about small areas. There is a high cost involved in fencing small areas. Development must also be kept up. The smaller the area, the more expensive the fencing. In some instances, it may be possible to have two or three farmers creating woodlands together.

I had a small area to deal with. I do not remember its size, but I remember that the fencing was five miles long. I went in cahoots with a neighbouring farmer who was also a proprietor. We put up a long woodland which provided cover between two farms. He did one side and I did the other. My part of the fencing was five miles long, and that rather put up the cost. I have not had the cost back yet. We must watch these things. Wet areas are all right, but the draining must be watched because other costs come in. The costs want looking into. I think that I have said all that I want to say. I shall have much pleasure in helping to put this Bill on the statute book. It cannot but contribute in every aspect to the population of the countryside.

4.25 p.m.

Lord Denning

My Lords, on behalf of us all, I should like to thank the noble Lord, Lord Borthwick, for the enlightening speech he has given us from his great experience. He has a family title which goes back to 1452 and he is the 23rd Lord. I read that the Lordship was dormant from 1910 to 1986. How good it is that it has now become active with such a splendid speech by my noble friend. One of the most attractive qualities of the title is that the holder is the Hereditary Royal Falconer for Scotland. Long may he continue with his falcons!

I do not know much about farming, though I have a little farm of my own. Surpluses in the European Community are a problem which must be tackled. There is far too much milk and butter. There are butter mountains and the like. Something must be done to reduce them for the benefit of all.

The Bill seeks to do that by encouraging farmers to give up a great deal of their agriculture and do other things. The Bill seeks to encourage them to give up their farms or a large part of their land and turn it into woodland. They will receive grants for that purpose. As one who loves our English countryside, I hope that that will not go too far. I love our countryside with its golden cornfields, meadows, cows, dairies, hedges and the like. Please do not destroy it and turn us into an afforested land like the Lake District.

I plead that we should preserve the amenities of our countryside. It has the best and most experienced farmers in the world. It has the best machinery in the world. Please do not decrease our agricultural industry too greatly though I realise that something must be done. The schemes have been discussed with all those interested. No doubt the Bill will give them force.

Having made that plea for the countryside, I wish to turn to one special subject. I wish to talk about councils and others in the South of England. These schemes all talk about converting agricultural land into woodland. Through large parts of the South of England there are projects for converting woodlands into agricultural land. Planning law at the moment gives the advantage to the person who plans to turn woodlands into agricultural land. Under the 1971 planning legislation there was a provision which enabled local authorities to make tree preservation orders to preserve our woodlands. No one is allowed to cut or fell timber or grub up those woodlands without the consent of the local council.

There was also a provision that if the applicant was refused permission he could obtain compensation from the local authority which had refused him that permission. There have been cases in the Canterbury City Council area. There have been cases in Hampshire, at Oakley, near Basingstoke. The local authority put tree preservation orders on a beautiful copse and woods to save them. They were not to be grubbed up or destroyed. They were to be kept because they were an amenity. That is what local authorities do.

Then what happened? Commercial companies came in and, having bought the woodlands at a very cheap price, applied to the local authority to turn them into agricultural land. The local authority of course refused. It was preserving our amenities. The commercial companies then said, "We claim compensation from the Lands Tribunal. You have stopped us developing this into agricultural land; so you must pay us compensation." Awards have been made—in Canterbury, £50,000 or more. The woods, of course, are never going to be taken down. So this is a sheer windfall for the person making the application. The same is threatened in Hampshire.

As an ancillary part of the Bill, some provision should be made to prevent such exploitation. I have noted down a suggestion for consideration. It is to amend Section 174 of the Town and Country Planning Act 1971 to provide that compensation is not given for conversion of woodland into agricultural land. The present woodlands, which go back centuries, should not be turned into agricultural land and should not be made the source of profit for the person making the application.

Apart from that, like other noble Lords, I welcome the Bill, although I make the plea that preservation should not go too far.

4.33 p.m.

Earl Ferrers

My Lords, had it not been for the debate in your Lordships' house yesterday, it would have given me great pleasure to congratulate my noble friend on his maiden speech. However, as it was considered that it would be inappropriate for other speakers to do so, I shall desist. I should declare an interest. I am involved in agriculture and forestry, and I am a director of a forestry company.

I welcome the Bill and congratulate my noble friend on bringing it forward. However, I was disappointed and surprised by the noble Lord, Lord John-Mackie, because he really did wire in to my noble friend. The noble Lord is very agreeable, but it appears that he got out of bed the wrong side this morning. There was my noble friend explaining what the Bill meant and the noble Lord, Lord John-Mackie, saying that he did not know where to start but that he objected to all the detail. I thought that the noble Lord might have started in the wrong place. Like the noble Lord, when I first read the Bill, I did not know where to start because I did not know what it meant. I was glad that my noble friend had the graciousness to explain to your Lordships what this enabling Bill means. Had my noble friend come forward with a Bill saying, "Here is an enabling Bill, but I do not intend to tell you what we are going to do", your Lordships might reasonably have complained. I noticed that the noble Lord, Lord Walston, joined forces with the noble Lord, Lord John-Mackie. With respect, I think that he too was a little misplaced. Incidentally, having said that he objected to all the detail, the noble Lord, Lord John-Mackie, was not sated with it but proceeded to ask for more. That, again, was curious.

The Bill has wide powers—

Lord John-Mackie

My Lords, if I may say so, I asked the noble Baroness about provisions in the Bill. I did not ask for anything outside the Bill. I asked for some explanation of one or two provisions in the Bill.

Earl Ferrers

My Lords, that is fine. The noble Lord has it on both counts: he gets what is in the Bill and what is not in the Bill; so he should be well satisfied.

The importance of the Bill is not what it says but what it represents. My noble friend said that it is not a large Bill. It is, however, large in philosophy. It is a positive indication that the Government are helping agriculture to diversify. I do not think that it would be easy to do that, because farmers go into farming to farm. For many, that has been the only way of life. They do not go into farming to run golf courses, to make Victorian rocking chairs or to turn their homes involuntarilly into hotels.

I was interested to note that the Bill makes provision for horses. That must be unique. I understood that the Ministry of Agriculture had ruled that horses were not agricultural animals and therefore that horses were debarred from anything to do with the Ministry. My noble friend has driven a coach and four through those regulations.

I hope that the Government will consider the Bill, modest as it is, as a first step only in helping agriculture to meet the changes of the future which are unknown. It is right to remind ourselves that agriculture is going through an unprecedented revolution. For the first time in about four decades it lacks a sense of direction. It lacks public support because of such things as the surpluses, and the cost of the common agricultural policy. In the public mind the vast costs of the common agricultural policy, caused, as they are, by the storage and disposal of surpluses, are assumed to have gone to farmers so that the farmers are all right. But that simply is not so. It is true that some farmers, possibly large farmers on good land, may be all right. But most farmers are not large farmers and are not on grade 1 land.

British agriculture is going through an exceedingly difficult time with the prospect of conditions getting worse. Many farmers are in financial difficulties. Many are selling their farms; many would wish to do so were it not for the fact that the farm also happens to be their home. I want my noble friend to understand without any hint of doubt that the farming community is undergoing acute financial strain. After this year's appalling weather in which the harvest was ruined, there are not many farming units—certainly not in East Anglia—that will be in a state of profit. I do not blame the Government for this; it is part of the business of farming. I merely state the fact because it is too often said that the farming community is doing all right.

With that scenario and against a bleak and unexciting outlook, it is not suprising that the industry is depressed. If the Government do not wish to see a declining countryside, they must be fully aware of that fact. I agree very much with the noble and learned Lord, Lord Denning, that the British countryside is a fine thing. It would be a great pity if we were to see that countryside become derelict and spoilt. To change it completely is not all that easy. I agree with the noble Lord, Lord Walston. I do not know whether this would have a vast impact on surpluses. If it did have a vast impact, make no mistake! It would have a huge impact on the countryside as well.

I welcome the Bill as the first step. I am glad that it will enable not just one scheme to be made, but several. The incentives will have to be substantial to encourage change. Whatever may be the income from change, the cost of change—not just the financial side but the managerial, emotional and expertise aspects—will often be way beyond what many people expect.

I am glad to note in Clause 2 provisions for encouraging farm woodlands. I dare say that that will run into difficulties with our friends the environmentalists. Already there seem to be murmurings of disagreement. It is curious that 20 years ago there was an outcry against felling the trees because of the birds, the insects and the landscape. There is now an outcry against planting the trees for the same reasons, which I fancy will increase. I cannot help thinking that there are some people who adopt the old Victorian adage, "Go and see what the children are doing and tell them not to do it."

I hope that the Government will stand firm and encourage this alternative use. If agriculture is considered long-term, forestry is considered very long-term. It is one thing that forestry should provide an alternative land use but it is quite another that it should provide an alternative income. I was concerned that the incentives would not be high enough and, despite the rebuke which the noble Lord, Lord John-Mackie, gave to my noble friend today, I was glad that the noble Baroness indicated that the incentives would be larger than had previously been mentioned. That is a good thing.

I hope it will not be totally out of place, while discussing woodlands, the woods and the countryside, to refer to the recent terrible gale damage in some parts of the country—certainly in our area—where whole woods up to and in excess of 100 acres have been blown down as also have freestanding trees, whether hardwoods or softwoods. I believe that the amount of timber which has been blown down varies from 3½ million cubic metres to 7 million cubic metres. That is difficult to comprehend unless one puts it into perspective by saying that the area blown down would normally have been felled at the rate of about half a million cubic metres per year. Therefore at the lower estimate seven years' worth of timber has blown down; and at the higher estimate 14 years' worth has blown down.

Apart from the difficulty and expense in clearing this timber, it will produce a major marketing problem. Prices, like the Stock Exchange, will go haywire. The cost of clearance and of replanting will be phenomenal but, not just in the large forestry areas or in the large estate areas because it is the ordinary small, individual owners and small farmers who have suffered this very great destruction. The irony is that in many cases had the owner wished to fell the tree—the tree which subsequently blew down—when it stood, he would not have been allowed to do so. He would not have obtained a tree felling order because the tree was considered something of beauty. There has now to be replacement at great cost.

I should like to ask my noble friend—if it is not too far outside the ambit of the Bill—whether she would be kind enough to let your Lordships know the rules or the provisions governing the grants for replanting. The Government acted with extraordinary alacrity and allowed I think £3 million for replanting. Is that to go just to local authorities or is it to go to the private sector? Will those private individuals, who whatever the size of their holding may have suffered damage which they wish to repair and replace, be able to have access to any of those funds?

I welcome the Bill. I hope that it will be the first of a number of measures that the Government will introduce in which they will be shown to be actively and unashamedly helping agriculture through a period of unprecedented and unforeseeable change.

4.47 p.m.

Lord Hunt

My Lords, I was not in your Lordships' House yesterday when I understand that it was agreed that succeeding speakers would not congratulate a maiden speaker on his or her speech. I hope that your Lordships will forgive me—in fact I hope that you will echo my sentiment—when I infringe that agreement slightly to congratulate the noble Lord, Lord Borthwick, on his admirable brevity, setting a splendid example to noble Lords.

I follow the noble Earl, Lord Ferrers, and previous speakers, in welcoming the Bill. I cannot imagine that anybody would not welcome it. I do not follow the noble Earl further beyond noting his strictures about environmentalists. I know he meant them in the kindest possible way.

I speak this afternoon—as I am sure others do—on behalf of those who are concerned for the conservation of our countryside. The Bill provides the authority for the agricultural ministries to enable and encourage farmers to remain on the land. That must be welcome to everyone who is concerned and cares about our countryside, the wildlife in it, the recreation opportunities, the access to the countryside, and the general enjoyment of the public. I am mainly concerned from the environmental point of view. Farmers are essential to manage and care for the countryside in the way that they have done from time immemorial. For those of us who are or have been concerned with national parks it is particularly welcome that the Bill proposes to make grants to farmers on a positive note. We have never liked the provisions in the Wildlife and Countryside Act 1981 which make grants to prevent them from doing things which are deemed to be environmentally damaging. This strikes a positive note and that is surely excellent.

I accept that this is an enabling Bill. I had not expected to hear from the noble Baroness the details which she was good enough to give us. I have done my best to follow them. I shall read them more carefully in Hansard tomorrow. However, I have come bearing a message of concern from a number of environmental bodies—the CPRE, the Council for National Parks and a number of others including those concerned with recreation—which have received no reply from the Ministry of Agriculture to their responses to the consultative document. That was made available to them last May. Am I to take it—perhaps the noble Baroness will correct me if I am wrong—that what she has told us and what we shall shortly have laid before us will be the response to that consultative document? At this moment in time these bodies are still concerned about a number of aspects, most of which the noble Baroness covered, and, as far as I was able to follow, some of what she said should allay their anxieties to some extent.

Although this is only an enabling Bill, there are one or two relevant points in the Bill on which I should like to comment. Those of us who are concerned with the aspects of the countryside would like to be reasssured that the requirements of Section 17 of the Agriculture Act 1986, dealing with the social, economic and conservation aspects and the enjoyment of the public, will be met. I note that that section is referred to in Clause 2 of the Bill. That is very satisfactory but I am left wondering why there is no reference to it in Clause 1. Perhaps the noble Baroness will comment on that when she replies.

The inclusion of the term "farm business" in the Bill has done nothing to allay the anxiety of those outside your Lordships' House and perhaps of some of us within. Schemes for environmental conservation or enhancement, and schemes designed to allow the public at large to enjoy the countryside, do not all sit comfortably under the heading of "farm business". For instance, some may not be financially rewarded. One can think of quite a number of activities and provisions for the conservation of the countryside, for the enjoyment of the public, which will not bring in money. One would like to be assured that, nonetheless, the grants will encourage them to make provision as required under Section 17 of the Agriculture Act.

I am particularly interested in and concerned with recreation in the countryside. It would be hard to exaggerate its importance. The Countryside Commission in a recent survey estimated that some 84 per cent. of the public at large enjoy recreation in the countryside, and no fewer than 24 per cent. are regular walkers in the country. According to the Association of National Parks Officers, some 90 million people visited the parks in 1986. I am certain that that number was exceeded last year. That is five times the total number of people attending all professional football matches in a season. Should not the Government reconsider the term "farm business" or perhaps amplify it, so as to ensure that the spirit as well as the letter of Section 17 of the Agriculture Act is adhered to? To that end also, and just to repeat myself, I should like to see a reference to that section in Clause 1.

As regards Clause 2, I, as do others, welcome the fact that grants are to be made not only to convert the land to woodland, but to manage that woodland once it is established. It is no less important that farmers should be encouraged and enabled, through grant-aid, to manage and improve the condition of woodlands which exist already and some of which have been neglected for generations. Those, too, should be eligible for grant. I hope that the noble Baroness will be able to reassure us that what we shall have laid before us will make provision to that end.

Here again we await MAFF's response to the comments offered by the voluntary bodies on MAFF's woodland consultative document, which was published last March. Needless to say, the requirements in regard to conservation—conserving the landscape and providing for public enjoyment and access—are just the same for woodland as they are for the countryside. The profit motive implicit in the term "business" in regard to Clause 2 may well encourage farmers to convert land mainly into conifer plantations. I should like to stress, as has one other noble Lord, that that has done much to spoil our upland landscapes.

Finally, on Clause 3 I note that the membership of the Development Commission is to be increased. I venture to hope that that will make it quite certain there will be adequate representation of those interested in conservation and the environment as well as those interested in amenity and recreation.

4.53 p.m.

Lord Stanley of Alderley

My Lords, this is the first, and I hope the last, time that I have to apologise for having to catch a train so I may not be able to be here for the winding-up speech of my noble friend this evening. The alternative is to face divorce, which after 34 years of marriage would be very expensive. I doubt whether even this Bill, wide though its powers are, would give me a diversification grant for such an activity.

Your Lordships have noted that this is an enabling Bill, despite the criticisms of the noble Lords, Lord John-Mackie and Lord Walston, who complained that my noble friend on the Front Bench gave them too many details. Like my noble friend Lord Ferrers I think that in agricultural terms they were pushing their luck a little in so far as, if she had not, I would be absolutely convinced that they would have said she should have. But that is par for the course, I suppose.

However, as far as I am concerned it is difficult to interpret what exactly the Bill's details and its effects will be. But I can assure the House that its effects will be minimised unless the Government ensure, realise or appreciate three things: first, that planning authorities will recognise the need to grant planning applications further to encourage diversification. Some local authorities do but others do not. Although I recognise the concern expressed by the noble Lord, Lord Hunt, and by the noble and learned Lord, Lord Denning, I have a brief from the RSPB. My heart, if there is a conflict, lies with solving our rural unemployment problems rather than with the birds and bees. Sometimes, I am sorry to say, there is a conflict. One has to decide which way to go. I was pleased to note the remarks of my noble friend that small plantations will be free from local authority planning.

Secondly, and the noble and learned Lord, Lord Denning, raised this point, unless the basic agricultural financial problems of the CAP can be solved and a long-term plan evolved—which in my opinion must be based on price restraint—the Bill will achieve very little, for the incentive to diversify will be lost. Thirdly, the help for farmers to diversify suggested in the Bill will, I hope, mean more employment in the countryside. Much of it, I believe, will be part-time. Unless the Government come to grips with the problem, those who are in receipt of unemployment or social security benefit and who wish to take on part-time work, will not do so if most of their social benefit is clawed back, which it is at the moment. When that happens they are no better off financially, unless of course your Lordships approve of the black economy. I hope that my noble friend can assure me that the Government will keep these three points in mind so as to make this Bill as effective as I and I think every one of us would wish. I therefore wish it well.

4.57 p.m.

Lord Moran

My Lords, I welcome the Bill and the shift in objectives which it sets out. I was encouraged by what the Minister told us about it. Unlike the noble Lords, Lord John-Mackie and Lord Walston, I found it helpful to have the details that the Minister gave us. I must declare a potential interest in that my wife has a very small hill farm in mid-Wales.

The noble Earl, Lord Ferrers, spoke about public attitudes to farmers. If farmers are to be given more grant support—and I think it is right that they should be given this support, as suggested in the Bill—it is important that public opinion is carried with us. To secure this, diversification needs to be carried out with real concern for the environment and conservation. The need is to encourage management practices which will benefit conservation while helping farmers to increase their incomes in the way that the Government propose.

The chairman of the Nature Conservancy Council said today in introducing his annual report: The advent of the Environmentally Sensitive Areas was an important MAFF initiative which seems to have been greeted favourably by farmers. If the principles established within Environmentally Sensitive Areas were to be extended more widely, I believe we should be on the verge of a major breakthrough. The attitude too of most farmers and landowners has become immeasurably more sensitive". I am greatly encouraged by those words.

I should like to ask the Minister what safeguards there will be—for example for the protection of wildlife habitats. I hope that grants will not be made if any plans propose damage to landscape or wildlife. Farm improvement schemes should, I am sure, include full details of environmental aspects.

It is reported that the eligibility conditions for the schemes are to be onerous and stringent. If so, I wonder why, because there is a need to encourage, not discourage, new entrants to farming, small, family farms and part-time farmers, who are often those who do most for conservation. It is not usually they who grub up hedges or shovel nitrogen on to the land. If the eligibility conditions are at present stringent, I suggest, with respect, that they need to be reviewed and the scheme made as widely available as possible.

I warmly welcome the objective of the farm woodlands scheme but, like the noble Lord, Lord Hunt, I am concerned about the possibility of more extensive planting of conifers. It was suggested in the consultation document that the aim should be to have 35 per cent. broadleaves in the lowlands and 5 per cent. in the severely disadvantaged areas. That means in fact 95 per cent. conifers in the uplands and up to 65 per cent. in the lowlands, which seems a lot. I am very concerned about acidification, which is damaging all the life in a number of the upland rivers in my part of Wales. We are quite rightly spending millions of pounds on flue gas desulphurisation to deal with the problem of acid rain, but it is well established now that there is a connection between the planting of conifers and the acidification of streams. This is a matter about which we need to take particular care.

We need to encourage native broadleaf schemes, not least to replace the trees devastated by the recent storms. I would prefer to see two-thirds broadleaves rather than the one-third suggested by the Government. I should like to give one other quotation from the speech made today by the chairman of the NCC. He said: Forestry, and indeed farm woodlands, have an important part to play in the rural economy but their design and management should also be related to nature conservation, and this is something which is improving fast. Above all, however, afforestation needs to be located in areas which are not of high wildlife interest and at present, despite intensive discussion with those concerned, we are still far from happy about what is happening". I hope that the Government will pay attention to those words.

It is important that the few remaining semi-natural habitats should not be disturbed. In her speech the Minister said that the timescale for both broadleaf and mixed woodlands was to be extended, and I warmly welcome that. But I wonder whether we need a cut-off period at all. Any finite period of years will tend to encourage intensive and therefore damaging forestry practices. I wonder whether we cannot have continuing management programmes.

I warmly welcome the Government's decision, announced by the Minister this afternoon, to abandon the plan to concentrate on marginal farming land and to look instead to improved land. That is important. There is also, I believe, a need for annual payments to rehabilitate existing farm woodlands which are at present excluded from the scheme. In my part of Wales where we have sessile oak woods, which used to be extensive but are now confined to steep river valley slopes, there is often a problem with over-grazing preventing regeneration. We must remember that the number of sheep in England and Wales has doubled since 1947. I wonder whether the scheme could not be extended to cover existing farm woodlands and possibly also hedgerow trees.

Lastly, I wonder whether the Countryside Commission and the Nature Conservancy Council will be consulted about what the Minister herself described as an experimental scheme. It is important that their advice should be available as the scheme develops.

5.5 p.m.

The Earl of Radnor

My Lords, I too welcome this enabling Bill. I am grateful to have a foresight into what the regulations might eventually hold. It comes in the face of farming going a little wrong compared with the happier days gone by and in the face of European and world surpluses in commodities. The point of it must be to help the farming community survive properly, the farmers to stay in business and the workforce to remain employed while at the same time doing something towards reducing those surpluses. Perhaps we should wonder whether it will achieve those two objectives in any large way. I certainly hope that it will.

Perhaps I may look first of all at the farm diversification and expansion grants. In regard to existing buildings and new buildings they will presumably give people scope and help them find out how to run businesses and whether they are likely to be viable. Somewhere down the line training must come in. For the life of me I cannot at the moment see some of my extremely skilled workers and those of my neighbours diversifying too far away from what they have been used to doing for a life time. Whether the Agricultural Training Board can deal with the situation I do not know, but it is an area that should be looked at.

Secondly, and perhaps a little contrary to my noble friend Lord Stanley, I wonder a little about planning as regards both diversification and expansion. Perhaps the two join together. Agricultural buildings up to a certain size do not need to have planning permission but if an expansion on a holding is Contemplated—to make icecream from milk, or something like that—and is successful, where does that expansion stop? Can the man who is successful be told when he wants to put up an enormous icecream factory that he must expand no further? The point intrigues me and perhaps my noble friend will be able to throw light upon it when she comes to reply.

I have mixed feelings about the forestry aspect. I am keen on woods but I feel it is somehow wrong that trees should be grown on grade 1 land, I assure the noble Lord, Lord Hunt, that I feel it is equally wrong that trees should be grown on wild habitats up in the hills. They should be grown somewhere between the two; and to use an expression that was bandied about some time ago, trees should move down the hill to a certain extent.

It is all very well to say that the surpluses come from the good lowlands. In a way, they are the places where the crops should be grown. The surpluses come from people who grow winter wheat, for example, on land which is marginal for winter wheat but which has been very profitable. Those areas would be better suited to trees.

As regards the details that we have been given so far, I feel strongly that, in spite of the fact that my noble friend has been reasonably expansive, the money is still too little. My noble friend Lord Borthwick, who is no longer in his place, made the point about thinnings. It is so easy to confuse money coming in with profitable money coming in. The sizes are too small. I cannot speak about Ireland but I cannot see that to plant three hectares of any kind of wood, except for fun, is sensible. I think that the upper limit should be expanded beyond 40 hectares.

I should like to make one point very strongly. The trees will be monitored and, one hopes, looked after properly. I understand that the grant paid will be reviewed. That was so with the dedication scheme but the grants were reviewed very seldom and in rather a paltry manner. I suggest that when the regulations come into effect the grants, which have been outlined at so much per acre, should be indexed in some way so that there will be no falling back on an early promise. There was a great deal of resentment from some people who had dedicated their woodlands, which was an irrevocable act, as is planting trees. Over the years the money was gradually eroded until it made no sense at all.

In conclusion, I think that this must be a step in the right direction. In the European context I do not think that this will make a great deal of difference to any surpluses. On the other hand, I think that it is preferable to take a gradual step now rather than a large one.

5.13 p.m.

Earl De La Warr

My Lords, I should like to use the description that was used by the noble Lord, Lord Walston, and say that I regard this as a useful Bill and potentially moderately important. In the time that I shall allow myself I should like to talk about only one aspect, and that is the question of farm woodlands. I want specifically to deal with Clause 2(1)(b): grants for abating any financial loss which has been or will be suffered in consequence of the conversion of land from agricultural use to use for woodlands. That really is the nub of the clause and the scheme.

More than a year ago we in this House debated the last agricultural Bill. Although I am not given to quoting my own speeches unless I can possibly help it, I should like to remind your Lordships of one thing that I said. It was that pressures on farmers to reduce output were bound to increase whether by quotas or by managed set-asides. For the farmer the effect of those is exactly the same. All such pressures reduce his revenue, and most of that will go almost direct to the bottom line". It is about the bottom line that I should like to talk tonight.

I should like to take one example and try some short verbal arithmetic. Let us assume that there is a farm of 100 acres on reasonable grade 3 land. It is growing 100 acres of wheat at roughly three tonnes to the acre and the farmer receives £100 per tonne—lucky man! Let us also assume that the fixed costs have been pared and are very tight. At the moment his revenue will be £30,000. Let us say that he spends £100 an acre on variable costs, which are sprays, fertilizers and seed—and that is all there are—that his fixed costs are £15,000 and that he makes a profit of £5,000. If he plants 5 per cent. of that land he will take 5 per cent. out of production and his revenue will decrease by £1,500. His expenses will decrease by only £500 because the fixed costs, as the noble Lord, Lord Walston, said, remain exactly the same. Therefore, it is a question of 5 per cent. off the revenue and 20 per cent. off the profit. If one increases the area of land planted to 10 acres, then it will be 10 per cent. off the revenue and 40 per cent. off the profit.

Let us be quite clear about the hard arithmetic. Every farmer must make his own calculations, but in the final analysis he is bound by his profit margin and the ratio of fixed costs to total costs. He will have to bear in mind not only the calculable loss of profit but also the fact that for the first time he is doing something permanent and irrevocable to his land. Next year he will not be able to say, "Well, we made a bog of that one, let's grow potatoes". No, it has gone and gone for good. I think that many farmers are likely to say, "Unless I get a really handsome recompense, it may be better to leave the land fallow. At least it will give me the opportunity to use it when times are better or when a new crop emerges that I should like to exploit". I believe that to be the kind of attitude that will be taken and I believe that it is the kind of attitude that should be taken. The industry is in no condition to do other than look carefully and continually at its costs and profits.

I look forward to hearing the response of my noble friend to a number of points that have been raised by your Lordships. In particular, I hope that she may be able to say a little more than she has said so far about the size of grants proposed. In this respect my hopes are not great because she has told us what they are to be and she has said that she thinks they are adequate. If adequate means fair, then maybe they are and maybe they are not. If adequate means effective, then I am sorry to have to say to my noble friend that I can see precious few farmers taking advantage of the offer from the Government if they apply the hard criteria which I have suggested are essential.

I am not too sure that that will really matter. My noble friend has told us, and I agree, that this exercise is experimental. If we find that farmers are not tempted by this, the Government must think again as to whether it is worth offering more. Forestry is a long-term endeavour and we must not rush into things. I am reasonably happy with the observations of my noble friend, in view of the Government's experimental attitude to this project.

We must bear in mind at Committee stage that the Bill is simply an enabling Bill. However, it occurred to me—and I shall continue to stress this question of financial compensation or grants—that in the subsection to which I am speaking it might be better to use the phrase "loss of profit" rather than the words "any financial loss". I do not know exactly how that subsection should be worded. However, I believe that during the Committee stage we should explore the Government's attitude to this matter a great deal further than we have so far. I hope that as a result we shall obtain at least some useful information, if no immediate change.

I finish as I began by saying that this is a well intentioned Bill which could have some useful if modest results. It is on that basis that I welcome it.

5.21 p.m.

Viscount Massereene and Ferrard

My Lords, I was very pleased to hear my noble friend Lord Ferrers raise the matter of the appalling storm damage that has recently been sustained in the South of England. Before I continue, I must declare an interest in that on my land in the Stour Valley between Ashford and Canterbury where there are three estates—Olantigh, Godmersham and Chilham—the most appalling devastation has taken place. Thousands of trees, including very big trees have been uprooted; the whole park has been decimated. I understand that it will take at least two years to clear up.

Even inside the ha-ha—which means the grounds—pretty well all the trees have come down, including some rare and exotic specimens. The only tree of historic interest that withstood the storm is the king holm oak. Fortunately last year I had the dead wood cut out and the tree wired and supported, so it survived. I must not distress the House with my personal troubles, but I have always been a great planter of trees and taken a great interest in them, so the loss of so many of them has been quite a shock.

I congratulate the Government on what they are planning to do regarding the surpluses, which is a step in the right direction; although it will not solve the problem of the surpluses, even if it helps a little, as we have heard today.

Before turning to the subject of trees and Clause 2 of the Bill, I should like to point out that Clause 1 represents an opportunity for offering further recreational facilities to the public. Problems can of course arise when the public has too much access to nature walks, ponds or lakes that the farmer may create on his land; and to a certain extent such excessive access is destructive of wildlife and the natural habitat. No doubt, however, those problems can be sorted out.

I am worried about taking too much grade 1 land out of cultivation. There is always the threat of disease and crop disasters in the world, and as the population is increasing we may find that by taking too much grade 1 land out of cultivation no more surplus grade 1 land remains available.

Over 20 years ago a friend of mine had an estate in New Jersey (or perhaps it was the state of New York). At that time the American Government had a great surplus of grain and agricultural produce, and they forbade landowners in certain areas to plant any crops but paid them a subsidy of so much per acre. The thinking behind that prohibition was that if there were a disaster in the world and a failure of crops, it would not be necessary to plough up trees that had been planted, as we are proposing to do—I am not objecting to that at all—since it would be very difficult to put that land back into productive use for farming. It would probably take three or four years to do so.

I should like to issue a warning to my noble friend on the Front Bench. There is a danger that if we go too far in this matter, should disaster strike the world—and I am not thinking of a third world war, as an atomic war is unthinkable, but rather in terms of crop disease—in view of the increases in population we might regret having done so if we were short of arable land.

We shall be taking some time this evening on the Committee stage of a Bill about horses. I shall be taking part in that debate, so I shall spend only a few more minutes speaking now. In my experience, often the farmers who own the land want to cut down all the trees—at least many farmers do, though some of course do not. Farmers who wish to take advantage of this scheme and put some of their land under trees must be given extremely good advice on the kind of trees to plant, distances between trees and so on.

What I am driving at, however, is that one must also consider the wildlife. Certain types of trees—spruce, for instance—grow so densely that no wildlife can live under them. Your Lordships will no doubt recall that I have spoken about Sitka spruce before. I understand that the Government want to encourage the planting of broadleaf trees. If such trees are planted in sufficient number they will be very beneficial to wildlife. Of course, as we all know, those trees can only be grown on the best-quality land, and so good land will have to be taken for that purpose. Some of the very poor grade land, if not taken up and planted, will also encourage the wildlife which inhabits those areas.

I must stop speaking soon, having already taken up seven minutes. I should like to end by saying that I support this Bill, though I do not think that it will make a great difference to the EC surpluses. It is a step in the right direction and I congratulate my noble friend on the way in which she introduced it.

5.30 p.m.

Lord Mackie of Benshie

My Lords, I think that I can echo the small welcome given to the Bill by some of my noble friends. But it is an enabling Bill. In fact, it is the most enabling Bill that I have ever come across. The immortal phrase, contain such supplemental, consequential and transitional provision as the appropriate authority thinks fit; and … make different provision for different cases occurs no less than twice. So I think I can say that this is a genuine enabling Bill, and I congratulate the noble Baroness on the vigour with which her noble friends defended her against the vicious attack by my noble kinsman with which I quite agreed.

However, let us take what the noble Baroness said in a Second Reading sense. I gather that the main objective of the Bill is to reduce the surpluses. In regard to that, my noble friend Lord Walston asked: where is the money coming from? The Minister might tell us what progress is being made with the EC in getting some of the money which can be saved from growing cereals. It must be a very great deal. On even two tonnes an acre, £30 to store each tonne of surplus and £70 to £80 of institution money to export it will amount to £200 an acre. At that rate you can afford to spend a good deal on alternatives and keep it. If, therefore, the noble Baroness can tell us what progress is being made with getting the funding from the EC I shall be very grateful. As at present constituted, the Bill will do nothing material to lower the amount of surplus grain produced.

The speeches of the noble Earls, Lord Ferrers and Lord De La Warr, were absolutely on the button as regards the situation in farming today. We need to look at a great many people in very different areas, in good arable areas and in marginal areas in the North-East of Scotland, which are in real trouble. If we are to produce a Bill which will keep people in the countryside, it must be—I have to say this—a great deal larger in commercial content than this one. It cannot really be an experimental Bill for very long, because the need to do something about retaining people in the countryside right now is urgent. Therefore, I think that the enabling Bill should have some broader clauses in it to enable other measures to be taken if money becomes available.

There are a whole lot of things which we shall need to know. I am glad to see the noble Lord, Lord Sanderson, on the Front Bench taking notes because there are many separate questions in Scotland including that of tenants. We have a much larger proportion of tenanted land—25 per cent. or thereabouts—and the provision for the planting of trees on tenanted land requires co-operation between landlord and tenant which does not exist at the present time. Therefore, there will be a difficulty.

I welcome the diversification part of the Bill. I know a little about it. I have seen a number of people who have done most excellent things in tourism, in retailing their produce and in providing other services. But, again, there are snags. For the crofters in Scotland to receive the hill cow subsidy, they need to derive half their income from farming. If they are to diversify so that they have more income, they can remove themselves from the ability to collect a subsidy on the hill cow. A whole number of these points need to be looked at as a matter of urgency.

Like the noble Earl, Lord Radnor, and very much unlike the noble Lord, Lord Moran, I believe that the scheme is aimed at the wrong place. The amount of money, if the figure is increased to £100 an acre, could well do a lot of good in a marginal area. If it were extended to putting many of these areas in Scotland, and even in England on the Downs, back into their traditional role of good, permanent pasture, properly managed in a dog and stick manner and combined with forestry, you might be doing a great deal of good there. But I agree totally with the noble Earl, Lord De La Warr, that the amount of money offered will not cover the overheads of an arable farm on even grade 3 land. So there are many complications.

Farm forestry should be encouraged. But, it is no good giving a grant to a farmer to plant trees unless there is a reasonable acreage. It is also no good unless the grant is for over 100 per cent. of the cost. A grant of 90 or 80 per cent. presupposes that the farmer has some profit to plough back into the land when that profit is simply not there. I should like an assurance from the noble Baroness that the grants in these cases for planting and maintenance will be enough genuinely to replace some, at least, of the income which the farmer is losing.

The farm woodlands scheme is particularly important for retaining people in the countryside. What happens about some of the excellent schemes which cover areas of hill land, to the pleasure of some people and the dislike of others? The trouble with the big schemes is that they tend to be done by contractors. The men move in at a certain stage for thinning, felling, or whatever it is, and then move out again. If you can encourage a genuine farm woodlands programme you will hold people on the land and maintain the population of the countryside.

I welcome the Bill. We shall look at it and probably suggest a number of amendments and perhaps extensions. I hate to crab, but I believe that it is too little and too late. The noble Earl, Lord De La Warr, described it as well-intentioned. You know where good intentions lead us.

5.38 p.m.

Lord Carter

I should like to start by expressing a little disappointment at some remarks that were made by my noble friend Lord John-Mackie at the start of the debate, when he revealed that the noble Baroness, Lady Trumpington, had asked him not to be too hard on her. I was disappointed because I was rather flattered to think that I was the only person on whom she had tried this rather disarming technique.

It seems now that my noble friend and I are founder members of a small and exclusive club.

As has been said, this is an enabling Bill. I do not intend to criticise the Government for introducing the legislation in this way. It is an approach to legislation which will be a very useful device for a future Labour Government and it is well noted. Obviously we must await the detailed orders and instruments which will implement the Act. I too was disappointed by the amount of detail that we were required to absorb at the beginning of the debate. I have to confess that I am not as clever as the noble Lord, Lord Stanley of Alderley, and the noble Earl, Lord Ferrers, so I found it hard to absorb it all. Obviously I shall have to read Hansard and the noble Baroness's speech extremely carefully, but we shall have a number of probing amendments to put down when we get to Committee stage.

We can all agree that the problems of surplus agricultural production must be dealt with and cured, but I beg leave to doubt whether farming salvation will be found through a combination of pony trekking, bed and breakfast and 90,000 acres of trees on grade 3 and 4 land—if the full acreage under the woodland scheme is achieved.

As regards Clause 1 I should like at the outset to declare an interest as an agricultural consultant, who might well be involved in some of the feasibility studies which will be grant-aided. There was a comment in the consultation paper and in the speech of jobs in agriculture. The chance to diversify on a larger farm could help to preserve farm jobs. to target assistance to small and medium sized farms". I ask the noble Baroness to look hard at that restriction and to explain to us the reason for it. When we have debated agricultural matters in the past I have made the point on a number of occasions that it is the larger farms which produce the majority of jobs in agriculture. The chance to diversify on a larger farm could help to preserve farm jobs.

We also understand that the restriction of grant aid on salaries for marketing activities will not be paid to members of the farmer's family. The phrase used was "no family ties". I think I understand the reason for that, but again I ask the Government to consider the situation of the son or the daughter who is coming home to the farm and who, if they had the chance to be employed on the farm under this new diversified venture, might be prevented from being added to the pool of the young rural unemployed.

I have some specific points to make about the clauses in the Bill. My first point concerns the use of the phrase regarding "adjacent land". As we all know, a number of holdings are fragmented. What then is the purpose of this restriction on farms with adjacent land? I believe there is also an intention to restrict feasibility grants to one per farm. My experience as a consultant is that the first report one does often reveals that the opportunity being considered is not the right one but it identifies other opportunities. In that case will there still be grant aid forthcoming?

If the feasibility study which is grant-aided reveals that the project which is being considered is unviable, will the grant still be paid? I presume from the wording of the consultative document and from the remarks of the noble Baroness that the scheme will be cash limited. How does the department propose to ration grants as the financial year proceeds?

The noble Baroness mentioned that: priority would be given to certain types of farm business". Will she tell the House the types of farm business that the Government have in mind? Obviously we welcome the suggestions regarding the tapering of marketing grants that the Government are considering and the reconsideration of the limits on the levels of grant aid.

A number of references were made in the debate to planning matters. If in fact there is a change of use will the planning fees which are involved be eligible for grant aid? In this sophisticated combination of capital grants, grants on the feasibility studies and the rest, how will the scheme deal with the definition of working capital? If there is a change of use, for example, and there is a diversification into bed and breakfast, tourism or a farm shop there are a number of incidental expenses involved which fall outside the capital grant area and the grants on the feasibility studies. Will the noble Baroness say therefore whether there will be any help in the form of grants towards the working capital of a diversified business?

It also seems from reading the consultation paper that conservation activities appear to be excluded as such, or is it intended that they will be caught under the other activities which are listed, which are recreation, amenity and leisure?

As a last point on the first clause, I must say that I was intrigued by a comment in the consultative paper which stated that one of the activities with which farmers could be helped was the provision of: wet weather games rooms for holidaymakers". I wonder what exactly the Minister had in mind when she said that, because in her speech she also referred to those activities which occur naturally on a farm. When the statutory instrument is put down I wonder whether it will describe the equipment required and the pastimes which will be eligible for grant aid.

I now deal with the woodland clause, which is contained in Clause 2. This is extremely detailed. I wish to say at the outset that we can all agree that 30 million is an awful lot of trees, but it is the acres that matter, not the number of trees. The crucial point is the number of acres which are caught by the scheme. Whether the Government are successful in achieving their target of 90,000 acres to reduce the problems of surplus production is the important consideration. As everyone has agreed it is a modest scheme. The target is 36,000 hectares over three years.

I wish to quote from a report by the EDC on agriculture, Directions for change: Land Use in the 1990s, just to give an indication of the size of the problem. A study by the Agricultural Departments and the Forestry Commission speculated that the potential for new planting of this type"— that is, farm woodlands might total around 80,000 hectares by the mid-1990s". That indicates the size of the problem and the fact, as we have all agreed, that this is a modest start.

I must admit that I am puzzled as to the objectives of the Government in the Farm Woodland Scheme. When one reads the document which was released on the scheme one sees that the first intention was: to divert land from agricultural production and thereby assist in the diminution of agricultural surpluses". The Government seem to be in a bit of a muddle on this, because over the page it states that those rates (which of course at the time were the lower rates): assume that planting would take place mainly on the more marginal farming land within each area, that such land would be … used for livestock rearing and that farmers would probably not choose to plant their most profitable land". Obviously that is the crucial question—whether the increase in the grant, which of course we welcome, will be enough to persuade farmers to give up their arable farming and to plant trees. I shall return to that point.

Will environmental safeguards also be built in? One of the objectives that was stated in the consultation paper was: to protect important habitats for wildlife". It seems to me that the Government are trying to carry out a balancing act—to increase the production of timber, to secure improvements in the rural economy, to reduce the surpluses in farm production and at the same time to protect and enhance the environment.

I certainly agree that the numbers of trained staff who will be required to advise farmers on both diversification and farm woodlands should be increased. I should like to refer to the debate that took place in this House last evening on research and development. We would all agree that in the case of research into forestry and woodlands even a combination of the Prime Minister, the Treasury and the scientific adviser to the Cabinet could not argue that research into a crop that has a life of 30 years can be described as "near market research".

There is also a technical point on the effect of the Farm Woodland Scheme on farm tenancy agreements, as they will be involved. It is clear from what the noble Baroness said that arrangements between landlord and tenant will be voluntary and that the model clauses which have been agreed between the NFU, the TFA, the CLA and the RICS will be voluntary. There is a simple question to which I think I know the answer. If a landlord in fact says no, presumably the tenant will not be able to take advantage of the Farm Woodland Scheme?

I should like to conclude by returning to the central crucial point about the reduction of surplus production. We now see that it is suggested that the levels of grant aid on the lowlands will be £76 per acre and not the £50 that was suggested previously, with the maximum of 50 acres increased to 100 acres. The House will see that I am extremely old-fashioned and I work in acres rather than in hectares.

Is that enough? A number of noble Lords, all with experience in farming, would say that it is not enough, as evidenced in the speeches of the noble Earl, Lord De La Warr, and the noble Lord, Lord Walston. There is no proportionate reduction in fixed costs as the farmer takes out small acreages of cereal to grow trees; we are all aware of that. What we as farmers will be considering is a judgment between a small acreage which we take out of arable crops and which will reduce our gross margins by perhaps £200 an acre, to be replaced by a figure of £76 per acre, which we are told rather vaguely will be reviewed over time. I should like to agree with the point which was made by the noble Earl, Lord Radnor, that the grants should be indexed from day one so that the farmer who is intending to take the decision knows where he is.

I think I must agree that this scheme, which is a modest start and experimental, as we all understand, will at the outset have little effect on surpluses at all. Even if in fact the Government achieve their target of 90,000 acres of land after three years, it will still not be enough to make much difference to surpluses of agricultural production.

As a final word, there has not been much discussion concerning the third clause of the Bill about the increase in the membership of the Development Commission, which we all welcome. It provides a chance to congratulate the Development Commission and CoSIRA on the excellent work that they do.

From this side of the House, we welcome the Bill. We will be constructively critical. We will obviously have to wait for the various orders and instruments that are required and we shall have much more to say when it comes to the Committee and the Report stages.

5.55 p.m.

Baroness Trumpington

My Lords, I must say that I was disappointed by the noble Lords, Lord John-Mackie and Lord Walston, in their unusual remarks concerning my opening speech. It just shows that you cannot please all the people any of the time! However, it has always been my understanding that the proposer of a Bill must do his best to explain the contents and consequences of the Bill. I believe that when noble Lords come to read the debate they will find the answers to many of their questions. I hope that the noble Lord, Lord Mackie, will also see that, contrary to what he said, this is a most helpful Bill for farmers who are looking into the future.

The noble Lord, Lord John-Mackie, asked whether there were enough plants available for farm woodland schemes. We have had meetings with the nursery trade which show that they do not share the noble Lord's pessimism. However, there could certainly be problems if we were planning on planting the millions of acres which the noble Lords, Lord John-Mackie and Lord Walston, have suggested as the way in which the scheme should be expanded.

I should like to reiterate to the noble Lord, Lord Walston, that the scheme is experimental over the first three years. The noble Lord asked whether diversification grants will cover, for instance, access roads to picnic sites. He also mentioned the problems that may be encountered by farmers in getting planning permission for diversification. The answer to the first question is that it would be more appropriate to discuss the details of the capital grant scheme when the orders are laid before the House, as they shortly will be. However, I can assure the noble Lord today that access roads will be covered.

Secondly, the onus for obtaining planning permission for a diversified project will rest with the farmer and not with the Ministry. However, we are well aware of the potential difficulties. My right honourable friend the Minister and the Minister of State for Agriculture are in close touch with my honourable friend the Minister of State for Housing and Planning to ensure that unnecessary obstacles are not put in the way of farmers who are planning to diversify. The Government have already issued revised guidance to planning authorities earlier this year in Circular 16/87 on the need to respond sympathetically to applications for the conversion of redundant buildings.

With regard to the environmental point raised by the noble Lord, Lord Walston, Clause 2(4) provides that in exercising functions under the clause Ministers must have regard to the duty to achieve a balance between various interests, including the conservation and enhancement of the natural beauty and amenity of the countryside as required by Section 17 of the Agriculture Act 1986. That provision imposes the same duty on Ministers in relation to farm woodland as already applies to them when exercising functions in relation to agriculture.

The noble Lord. Lord Borthwick, in his elegant maiden speech, was obviously worried about farmers not being good salesmen of timber. Clearly a great deal of advice will need to be made available to farmers, both on clearing woodlands and on selling their timber. I can assure your Lordships that that advice will be available from ADAS, the Forestry Commission and other sources. I am pleased that the noble Lord, Lord Borthwick, acknowledged that the markets for timber are now much stronger than they were a few years ago.

The noble and learned Lord, Lord Denning, spoke movingly of the glory of the trees in this country. As regards his proposed amendment, my first thought is that it might perhaps not sit happily in the Bill. However, we shall see.

I must thank my noble friends Lord Ferrers and Lord Stanley of Alderley for being my angels on horseback and defending my honour! I share the delight of my noble friend Lord Ferrers in the modest inclusion of the horse in this Bill. However, the possibility of horse activities in the diversification scheme does not mean that we are now treating the horse as an agricultural animal. It means that we may see the promotion of horse enterprises on farms as a very appropriate area into which farmers can now diversify out of agriculture.

The noble Lord, Lord Hunt, asked about responses to the consultation document on the farm diversification grant scheme. I think he mentioned various countryside bodies who had not received a specific response, I reply by saying that over 100 comments were received in response to the consultation report. All have been acknowledged and carefully considered. As a result, a number of significant changes are being made to the scheme to respond to the comments received. All those who commented will be notified of those changes once the scheme orders have been laid before Parliament.

The noble Lord, Lord Hunt, also asked why Section 17 of the Agriculture Act 1986 was not expressly applied to Clause 1. There was some doubt about whether Section 17 applies to farm woodlands. Therefore, we wished to make sure that it would. There is no need to do that in Clause 1 since Section 17 already applies to diversification.

I take very much to heart the point of my noble friend Lord Radnor about training. It is certainly not our intention that bad husbandry should accompany the planting of trees. He is worried about the rates of payment being too small and feels that they should be indexed. We have today announced significant increases over the original payments. Therefore, we can only wait to see whether they are sufficient. We have said that rates will be reviewed regularly.

I suggest to my noble friend Lord De La Warr that farmers will have to decide what the long-term prospects are for their main business activities. Obviously I understand the point about fixed costs but I say to my noble friend that surely we are right to try something positive, especially in view of the experimental nature of the scheme.

Earl De La Warr

My Lords, will my noble friend allow me to intervene? The noble Baroness will recall, I am sure, that I said myself that it was experimental. It may work. That does not matter. I gave it a welcome at the beginning and at the end.

Baroness Trumpington

My Lords, I am most awfully grateful for everything kind, charming, helpful and intelligent that my noble friend has said.

Earl Ferrers

My Lords, which of those epithets apply to my noble friend's intervention?

Baroness Trumpington

My Lords, I do not think we should go on with this conversation.

I make special mention of the noble Lord, Lord Mackie, who quite renewed my faith in the Mackie family. He asked me about funding from the EC. It may seem a small measure, but we are working within the EC to convince member states of the need for such things. My right honourable friend the Minister is working patiently and very hard to achieve results in the next Council meeting in a fortnight's time.

With regard to the progress with EC funding giving potential savings on cereals at present grown on surplus land, the farm woodlands scheme is a national scheme since EC forestry policy does not yet exist. However, my right honourable friend will in the coming weeks be issuing a consultation document on the so-called extensification scheme.

My noble friend Lord Stanley of Alderley, while welcoming the Bill, pointed out that it must be seen in the wider context of reforming the common agricultural policy. This is a point which I am most ready to accept. Our new schemes are complementary to, and will help to contribute to progress in, the reform of the CAP. I also agree that a major plank of that reform must be price restraint because of the need for a clearer signal to be given to farmers throughout the Community of the consequences of surplus production.

However, because of the scale of the change which is facing farmers the Government are also encouraging alternative enterprises and alternative uses of surplus land; hence the need for this Bill.

I thank the noble Lord, Lord Moran, who introduced some extremely interesting issues to which we shall no doubt return during the later stages of this Bill. Both my noble friend Lord Ferrers and my noble friend Lord Massereene and Ferrard expressed concern about the effect of recent storms. I offer my sympathy to my noble friend Lord Massereene.

The swift response of the Government to the widespread devastation to trees in the South and the East of England has been widely welcomed. A special unit called Task Force Trees has been set up by the Countryside Commission to co-ordinate the emergency programme, to assess the scale of the damage, determine priorities, give advice and arrange for the payment of grants.

The Government are providing the commission with an extra £2.7 million in this financial year towards the cost of the programme. Our aim is to achieve the restoration as soon as possible of our heritage of fine trees for future generations to enjoy.

That money will be channelled to individuals through local authorities. There will be grants for restocking woodlands and they will also be available from the Forestry Commission to individuals.

The Forestry Commission has already appointed a forest windblow action committee to deal with the problems of woodlands owners affected by storm damage. This committee has appointed a windblow task force supported by several advisory groups. Its remit is to look at specific aspects of the problem, for example, harvesting, marketing and restoration of the woodlands. The first priority is to assess the scale of the damage. Action is now proceeding urgently and advice to woodland owners will be issued by the action committee.

The noble Lord, Lord Carter, referred to adjacent land in the definition of farm business. This enables the ancillary business to be situated on a site next to the farm and still be grant-aided under Clause 1. The noble Lord asked about feasibility studies of one per annum. My answer is, normally yes, but with some flexibility for future grants if the study suggests some other approach.

Lord Carter

My Lords, actually it was one per farm and not one per annum.

Baroness Trumpington

My Lords, I am terribly sorry. You are perfectly right. I misread my note, and I repeat that for Hansard: feasibility study of one per farm. The next point raised was: if a feasibility study indicates non-viability, will the grant for the study be paid? To that my answer is, yes, if the feasibility study is carried out as approved. The third question was concerned with cash limits and which businesses will receive priority. Ministers may stop approvals if allocated resources appear to be in danger of being exhausted. Ministers have yet to decide how priorities will be allocated.

The noble Lord will forgive me if in my efforts not to upset the noble Lord, Lord John-Mackie, twice in one day I do not answer any more of his questions. I shall write to him on the other points he made. I shall not attempt an elegant last word. I commend the Bill to the House.

On Question, Bill read a second time, and committed to a Committee of the Whole House.

Data Protection (Subject Access Modification) (Social Work) Order 1987

Data Protection (Miscellaneous Subject Access Exemptions) Order 1987

Data Protection (Regulation of Financial Services etc.) (Subject Access Exemption) Order 1987

Data Protection (Subject Access Modification) (Health) Order 1987

6.7 p.m.

The Minister of State, Home Office (The Earl of Caithness) rose to move, That the draft orders laid before the House on 21st October be approved. [3rd Report from the Joint Committee.]

The noble Earl said: My Lords, I beg to move that the four orders under the Data Protection Act 1984 that stand in my name on the Order Paper be approved. Unless any of your Lordships objects, it will, I believe, be for the convenience of your Lordships' House if we were to consider the four orders together since they all in various ways relate to the common issue of the right of subject under the Data Protection Act.

In briefly introducing them I will, with permission, refer to them more shortly than their official titles, as the health order, the social work order, the financial services order and the exemptions order.

The intention of each of these orders is to modify in some way the operation of the subject access provisions of the Act. Some of your Lordships may perhaps feel that this is an example of the Government trying to take away with one hand what has been provided by the other; that no sooner is a right of access written into legislation than we come along with statutory instruments designed to whittle it away. That is not the case here.

The Act itself recognises exemption from the need even to register in cases of national security. It provides also that the right of subject access should not extend, for obvious reasons, to data held for the purpose of prevention and detection of crime, the apprehension and prosecution of offenders, or assessment or collection of tax or duty. It is recognised in the Act, moreover, that further modifications to the subject access provisions may be needed in certain defined circumstances. The Act empowers the Secretary of State by order to provide exemptions from, or to modify the provision related to, subject access in relation to health, social work and financial service data and data protected from disclosure by other enactments. The orders before your Lordships are in precisely these fields, which, as I say, were quite specifically foreshadowed in the Act itself, as requiring special arrangements.

With your Lordships' permission, I will now deal briefly with the intentions of each of the orders. Section 29(1) of the Data Protection Act allows the Secretary of State to exempt from the subject access provisions or to modify those provisions in relation to personal data consisting of information as to the physical and mental health of the data subject which is held by or was recorded by or on behalf of a health professional.

The health order enables a data user to withhold data which is likely to cause serious harm to the physical or mental health of the data subject and also data which might lead to the identification of another individual other than a health professional who has been involved in the care of the data subject. The general assumption is that information will only be withheld on the advice of a health professional, and then only when it meets the strict criteria of serious harm or when it would enable another person to be identified.

Data users in all other cases will be obliged to supply as much information as possible without causing serious harm or enabling another individual to be identified. In those cases where data are withheld the data subject will not be informed since to do so may itself cause the serious harm which the withholding was calculated to prevent. The Act is concerned essentially with allowing rather than withholding access and it is possible that where information is withheld the data subject may nonetheless be able to benefit from professional counselling.

The social work order, made under powers in Section 29(2) of the Act, deals with data held for, or acquired in the course of, social work and modifies the access provisions in this area. Article 3 specifies the data concerned which broadly is that held or acquired for social work functions by government departments, local authorities and other specified bodies including designated voluntary organisations of which the NSPCC and its Scottish equivalent are the only ones to have applied for designation. The order does not apply to the subject's health data, to which the health order applies—that is, this order does not apply to data held by, or consisting of information first recorded by, a health professional.

The access provisions are modified by disapplying the requirement to supply data when to do so would be likely to prejudice the carrying out of the social work where there is a risk that serious harm could be caused to the physical or mental health or emotional condition of the data subject or any other person, or that the identity of another individual, not himself a social work professional, could be identified or deduced—unless, that is, he has consented to the disclosure. The order makes clear the intention that as much data as possible should be disclosed so long as the purpose for which it was obtained is not prejudiced. In general terms this means that the benefit which the social work is expected to confer on the subject must not be frustrated by the disclosure.

The third order before your Lordships is the financial services order. This is made under the power in Section 30(2) of the Act and designates certain functions conferred by or under a statute relating to, inter alia, the regulation of financial services. Data held for the purpose of discharging these functions will be exempt from the access provisions where to grant access would be to jeopardise the performance of the functions.

The Act recognised this need for restriction since it might, for example, relate to suspected malpractice. Your Lordships will readily appreciate that to grant an individual access to data from which he could discover exactly what was known about him by the regulatory authorities might lead him to attempt to escape justice or to cover his tracks and make the conclusive uncovering of the malpractice that much more difficult. We have had here to weigh the rights of the individual against the need for confidentiality.

We have thought it right to recognise the special responsibility of the regulatory bodies for identifying and taking action against financial wrongdoing. Your Lordships may recall that a provision was inserted in the Financial Services Act 1986 to make it clear that self-regulating organisations and recognised professional bodies could be designated under the Data Protection Act in order that they might be exempted from the subject access provision in respect of some of the data which they hold.

I come, finally, to the last of these orders, the exemption order, which is made under powers in Section 34(2) of the Act. This exempts from the access provisions any personal data the disclosure of which is prohibited or restricted by the enactments and instruments listed in the schedule. The Government consider that these prohibitions or restrictions should prevail over the subject access provisions. The order covers three broad areas: adoption records and reports used in adoption proceedings or kept in the possession of adoption societies and local authorities; statements and records of the special educational needs of children; and in Scotland, information provided by reporters at children's hearings.

I should refer at this point to an issue which has been raised on this order by the Joint Committee. The committee has taken the view that there is doubt about the vires of the second entry in Part III of the schedule to the order in that it refers to an Order in Council which I am informed is shortly to be laid before Parliament reforming the law in Northern Ireland concerning adoption and which will bring that law into line with that in England under the Adoption Act 1976. It would obviously be inconvenient to have to lay another exemption order before your Lordships' House after the Northern Ireland order has been made, which is why we sought to cover the point in this way.

I accept the committee's objection is arguable, although the point was carefully considered when the order was being drafted and the view was taken that, on balance, this drafting device was both intra vires and perfectly proper. Nevertheless, as the Joint Committee has expressed a doubt about it, we shall consider whether we should take a suitable opportunity of bringing forward another order to clear up the point when the Northern Ireland adoption order has been made.

The orders have all been subject to detailed and lengthy consultations between the Home Office and the Government departments primarily concerned with the subject matter. They in turn have consulted widely among the relevant professional bodies and other groups outside Whitehall. In accordance with the provisions of the Act, the Data Protection Registrar has been consulted. I invite your Lordships to approve the four orders.

Moved, That the draft orders laid before the House on 21st October be approved. [3rd Report from the Joint Committee.]—(The Earl of Caithness.)

6.15 p.m.

Lord Mishcon

My Lords, the memories of your Lordships may go back, some of them nostalgically and some not so nostalgically, to the deliberations of the House on the Data Protection Bill. This is the first time, so far as I recollect, that the provisions have been brought back here in such a positive form, in that, after due consideration, the exemptions of the rights of data subjects are being considered in four fields, which your Lordships may have felt appropriate after the very clear explanation given by the noble Earl of the provisions of these orders, for which we are all indebted to him.

I do not intend to waste the time of the House in discussing those orders relating to education, adoption proceedings, social services and financial services, which quite obviously I should have thought will have your Lordships' agreement. I merely want to concentrate for a few moments on the important order which deals with the exemption of the rights of a data subject on matters of health.

As the noble Earl rightly said, we had a section in the Act—my recollection is that it is Section 29—which provided for provisions to be made where the mental and, indeed, ordinary health of the subject is in question. I noted, as your Lordships will have done, that the exemption with which we are dealing, obviously a very sensible one, has appended the adjective "serious" to the health and mental health provisions. I do not intend to dwell on this for very long because, as your Lordships well know, it is not possible to move an amendment to an order. One either agrees with or disagrees with the order.

I agree with the order but I cannot move an amendment. However, if I were able to do so I might have proposed that the word "serious" may prove troublesome in the future. It is sufficient to say that as regards the mental and physical health of the subject if the information is deemed to be harmful by those qualified to say whether or not it is, that is a sufficient cause for withholding it. I would have gone that far, and I believe that some difficulty might occur with the medical practitioner or, indeed, a dentist talking in terms of "serious" impairment to health.

Having made that preliminary point, which is not of grave consequence, I should like to refer the Minister to the concern which the national council looking after nurses, midwives and health visitors has about a provision in this order. It is a disciplined body. It has ethical rules and so on, as your Lordships will know, which guide its members, and indeed its members are responsible for keeping those principles. They regard their dignity, status and responsibility very highly. I need not lecture your Lordships on the way in which all of us value the services, particularly of the nurses.

In this order priority is given to medical practitioners—priority is also given to dentists, but I shall concentrate on medical practitioners—to decide about a relevant entry that is made in regard to the medical and mental condition of a patient, as to whether that entry is disclosable or not, bearing in mind the effect it might have on the patient.

The nurses, midwives and health visitors are only to be consulted in regard to such a matter if there is no medical practitioner available. The nurses, midwives and health visitors feel that where they have made a note themselves and where there is recorded data for which they are responsible, bearing in mind their professional responsibility, if anyone wants to shoot at them, if I may use the vulgarism, as a result of that entry, then they themselves ought to be the parties—whether or not there is a doctor available—where they have made the entry, to decide whether the data subject should have access to it.

It is a feeling not just of hurt pride but of professional responsibility. I believe the Minister might well wish when replying to the observations I have seen fit to make to make an announcement which in some way will satisfy the people who operate in the field of social service and the nation's health, for which all of us have a profound respect.

Lord Lloyd of Kilgerran

My Lords, I should like to join the noble Lord, Lord Mishcon, in thanking the noble Earl for his clear, concise and comprehensive introduction to the scope of these orders. I rise to give a broad but nevertheless cautious welcome to the four orders, for what they are worth. I do not wish to be thought to be damning them with faint praise, because on the whole I feel that they represent a step forward in the right direction.

I certainly congratulate the Government on having resisted the pressure brought upon them from some medical quarters to seek that exemption from access should have been directed to all medical records. I also welcome the change in the text for withholding exemption under the health order, which now includes the expression "serious harm", to which the noble Lord, Lord Mishcon, has referred. I think that is an improvement on the terms used in the DHSS regulations issued recently. However, I would tentatively suggest, if without perhaps the charm of the noble Lord, Lord Mishcon, in trespassing upon difficult ground perhaps that the word "serious" in that connotation may bring a certain kind of difficulty in practice.

I also welcome the fact that provisional judgments made by social workers have now been exempted from access in the social work order. Also to be welcomed is the fact that the protection for the identities of third parties will not prohibit the disclosure of the names of doctors, social workers or other professional staff involved with a data subject.

However, I have a fairly serious criticism in that none of the orders, even the orders dealing with health matters, allows access to manual records. I understand that there now appears to be considerable support for such access to manual records. The distinction which is made in the Data Protection Act between manual and computer records seems to me somewhat arbitrary. I should be grateful if the Minister, if he felt able to do so on an occasion like this, could give us some indication of why that distinction is still being adopted in regard to health matters.

It may be known to the Minister that the Data Protection Registrar has recently commissioned a poll and has found that eight out of 10 people in that poll thought that the Data Protection Act was to apply to manual records. As I say, perhaps the Minister may be able to indicate why the reservation is still being pursued in regard to health matters.

I should now like to join the noble Lord, Lord Mishcon, in what he said so eloquently about the position of nurses. I hope the Minister will be able to say something about the nurses, who do so much for so many for so little. The Royal College of Nursing, as the Minister will know, has raised a claim that the health and social work order, in so far as it affects them, is very restrictive. It produces complex access procedures for nurses and puts the medical and dental profession in a central position, which is not totally acceptable to nurses.

The other question I should like to ask the Minister is whether he can do anything about fees. I believe at the present time that there is a maximum fee of £10 for obtaining simple information from a single computer held by a single computer user. In practice there are bound to be multiple applications, and therefore I wonder whether the Minister has in mind, any method by which the cost might be reduced because of the special circumstances of the people making the application.

The last point I want to raise is this. I have not given notice to the Minister about it but I have given notice to the advisers. I have been looking at the order on financial services and have glanced through the list on the various pages to which the functions apply. I have also read the explanatory note in the order. I only wondered, in view of my special expertise in the field of patents, whether there should be a reference somewhere to the very important activities of the Comptroller-General of Patents under the Patents Act 1977. If I were asked to give an immediate answer, I should have thought that the Patents Act would require to be mentioned on the list, but I raise this in case I am wrong.

Lord Terrington

My Lords, let me say just a few brief words about the third order, because I consider that to be a most important one? During the Committee stage of the Financial Services Bill in 1986 I introduced an amendment on this subject. It was designed to ensure that SROs were able to perform their investigatory duties without fear of falling foul of the Data Protection Act's provisions regarding a person's right to access to any data held on an electronic database.

I was particularly concerned that investigations by the Stock Exchange's surveillance division into breaches of its membership rules could be compromised if a data subject demanded access to all personal information held on the Stock Exchange database. Such access could of course lead to that person who was being investigated destroying or altering prior to a disciplinary hearing whatever he wanted to change. As I understand it now, under this order that is no longer a possibility. I am therefore most grateful to the Government for the action that they have taken following the amendment I introduced in Committee.

6.30 p.m.

The Earl of Caithness

My Lords, I am grateful to those of your Lordships who have taken part in this most useful debate on subject access. We have had a most interesting debate on the Data Protection Act and the question of subject access. It is a measure of the general interest in this new statutory right for the individual to have access to data recorded about him on computer that your Lordships have been present and contributed.

As I said in my opening remarks, I understand that the registrar is to undertake a publicity exercise shortly so that everyone may be aware of the opportunity which is to be theirs from next Wednesday. I should like to pay a tribute to the work the registrar has undertaken since the Act came into force. It will be an additional benefit from our debate, and that held earlier in another place, that we too shall have helped to make the availability of subject access more widely known.

I should like to thank the noble Lords, Lord Mishcon and Lord Lloyd of Kilgerran, for the welcome they gave to the orders. They have been worried about the nursing profession. I have been tackled outside the Chamber by some of your Lordships, including the noble Lord, Lord Meston, who sent his apologies via me for not being able to be here at the moment. It has been brought to my attention already that the nursing, midwifery and health visiting professions have expressed much concern that the health order denies them the right to be consulted by the data user before the decision is taken as to whether information should be released, and that only doctors and dentists are recognised as health professionals who are qualified in that respect.

I am happy to confirm that nurses, midwives and health visitors are all recognised as health professionals under the order. The data user must consult the most appropriate health professional to decide whether to withhold access. Of course in the hospital environment, in the majority of cases this will be the doctor or dentist carrying overall clinical management responsibility for the patient. I can assure the House that in such circumstances the DHSS guidance makes it absolutely clear that this practitioner should seek the advice of other health professionals who have had a significant input into the patient's care. Those professionals are to be consulted by the practitioner and will include nurses, midwives and health visitors. I hope that satisfies the major concern of the noble Lord, Lord Mishcon.

Lord Mishcon

My Lords—

The Earl of Caithness

My Lords, I shall go further.

Lord Mishcon

Good!

The Earl of Caithness

My Lords, there will also be circumstances in which doctors have not been involved. It will be appropriate for the data user to contact one of the other 17 health professionals listed in the schedule to the order. It is for the data user to decide who is the most appropriate health professional. In many cases, especially in respect of work in the community, the most appropriate professional is likely to be the nurse. That position is provided for in the order and is reflected in the guidance issued by the DHSS. I hope that covers the second point of the noble Lord's concern.

Another point raised by the noble Lords, Lord Mishcon and Lord Lloyd of Kilgerran, was the inclusion of the word "serious". I gather that I was pretty unpopular in the office yesterday because I did not have anything to do with criminal justice. I am delighted to get back to drafting such matters with the noble Lords. We believe that to delete "serious" would mean that more information would be withheld than in the present case. That is the reason for including it in the wording. It is also the word used in the Council of Europe recommendation on automated medical databanks.

The noble Lord, Lord Lloyd of Kilgerran, asked about manual records. The proposals do not apply to manual records, though the Government recognise that the public will expect the principles of access to computerised records to be extended to manual records. The DHSS has commenced discussions with the key professional bodies to explore how greater access to manual records might be achieved. The operation of the Data Protection Act will provide useful lessons in that field. I agree with the noble Lord; I doubt whether the Patent Act falls within the vires of Section 30 of the Data Protection Act. I should like to check on that point once again, and perhaps I can write to the noble Lord about it.

Lord Lloyd of Kilgerran

My Lords, I thank the Minister.

The Earl of Caithness

My Lords, I am grateful to the noble Lord, Lord Terrington. We owe him a debt of gratitude for introducing the amendment. The provisions of this order flow from what the noble Lord said in Committee.

In conclusion, your Lordships will wish to know that we and the registrar intend to keep the operation of the Act under review, and if it appears necessary we shall not hesitate to revise the procedures in order to improve the operation of the Act, within the framework of the data protection principles set out in the European convention.

The Government believe that the orders are necessary in order to allow the right of subject access under the Act to operate in a satisfactory manner, and that they strike a proper balance between the rights of the individual and the wider public interest. I commend them to your Lordships, and invite the House to approve them.

On Question, Motion agreed to.