HL Deb 14 March 1991 vol 527 cc347-9

7.19 p.m.

The Earl of Strathmore and Kinghorne rose to move that the draft regulations laid before the House oil 4th February be approved [9th Report from the Joint Committee].

The noble Earl said: My Lords, I must begin by pointing out to your Lordships that an amendment has been made to the text of the draft regulations which does not appear in the version that you have before you. In Regulation I no date for entry into force has been given. This regulation has been amended to state that the regulations enter into force on the day after they have been made. I therefore hope that noble Lords will excuse this omission and will be able to consider the draft regulations, as amended.

These regulations are necessary to implement various EC marketing and processing grant schemes in Great Britain. The grant schemes derive from three EC council regulations: first, EC Regulation 866/90 on improving the processing and marketing conditions for agricultural products; secondly, EC Regulation 4042/89 on the improvement of the conditions under which fishery and aquaculture products are processed and marketed; thirdly, EC Regulation 4028/86, (Title VIII), on Community measures to improve and adapt structures in the fisheries and aquaculture sector.

The first two of these regulations have replaced EC Regulation 355/77 as part of the Community's wide-ranging reform of the structural funds in 1988. The third regulation, 4028/86, covers a number of fisheries and aquaculture measures, including the provision of grant-aid towards certain facilities at ports and landing sites which contribute to improving the processing and marketing of landed fish.

The three council regulations empower the Commission to offer grant-aid from the guidance section of the European Agricultural Guidance and Guarantee Fund towards those investments which most closely meet the aims of the regulations in improving processing and marketing conditions and bringing lasting and quantifiable benefits to producers and fishermen.

It is a basic requirement of all the schemes that eligible investments are supported by a minimum contribution from the member state government and these draft regulations provide for and control that funding in Great Britain. This national funding may, for example, be provided under the regional selective assistance scheme which is part of the Government's Enterprise Initiative. But, in any case where appropriate national funding is not available from any other source, the draft regulations empower Ministers to make a grant of five per cent. of the eligible investment expenditure. This is the minimum national payment required to attract EC grant.

The regulations provide for Ministers to approve expenditure for the purpose of obtaining EC and nationally funded grant-aid and for the payment of it in line with conditions including those set out in the Council regulations. Ministers are also empowered to revoke approval of expenditure and to recover grant-aid under certain circumstances which are set out in Regulation 8. That regulation also provides that, except in cases where the Commission decides to recover grant paid—against which we cannot provide any right of appeal—the applicant may be given a hearing before an appointed person.

The draft regulations impose certain obligations on applicants to preserve appropriate records in order to verify claims. They also create powers of entry for authorised officers for the purposes of enforcement and create an offence in respect of false statements made by applicants in order to obtain grant.

The grant schemes which these draft regulations implement are intended to benefit producers and fishermen. This can be done by assisting them to produce high quality, added value products with adequate shelf life and storage capabilities and generally by encouraging improvements in the way products are marketed and processed. Where there is a demand for the recycling of products such as straw, some producer returns from an otherwise waste product will be forthcoming. Consumer demand for high quality and/or novel products can be satisfied, thereby providing legitimate market-orientated outlets for produce. Better returns for producers and better marketing of produce have the added benefit of reducing reliance on intervention as a market of last resort. These grant schemes provide a small but significant amount of aid for the companies concerned. I therefore commend these regulations to your Lordships.

Moved, That the draft regulations laid before the House on 4th February be approved. [9th Report from the Joint Committee.]—(The Earl of Strathmore and Kinghorne.)

7.25 p.m.

Lord Carter

My Lords, the House is grateful to the noble Earl for the way in which he explained the regulations. We are also grateful to him for drawing our attention to the mistake in Regulation 1, where the date is omitted. I must repeat a demand that I have made on previous occasions and ask whether anyone ever proof-reads regulations. This is not the first time it has happened.

Regulation 3 enshrines the 5 per cent. contribution rule whereby Ministers may make grants for projects which are then able to qualify for aid from the guidance fund. Obviously, the willingness to contribute is necessary for the EC grant to be paid. Thus, the ultimate control of grants is in the hands of the department.

Does the department have any policies or guidelines on the way in which they choose the projects which should be supported? Would there be any geographical or financial balance or qualification on the size of the project? Perhaps the Minister will indicate the guidelines Ministers use in allocating the grants. It is also important for farmers and the agricultural industry for the availability of the projects to be publicised. How is the availability of the projects made known?

The Earl of Strathmore and Kinghorne

My Lords, I am grateful to the noble Lord, Lord Carter, for his comments. He mentioned two points, the first of which refers to the conditions for the 5 per cent. grant. The back-up grant of 5 per cent. is automatically available to all receiving EAGGF grants where other government grants are not forthcoming. For example, under previous schemes in Great Britain 95 per cent. of the beneficiaries received back-up grants. The remainder received domestic grants from other sources, such as the DTI regional selective assistance scheme.

The second point raised by the noble Lord, Lord Carter, related to publicising the grants. Regular departmental press notices and also comprehensive guidance notes are widely circulated to potential applicants. There are also seminars for consultants and potential applicants.

I trust that I have answered the noble Lord's points. If not, I shall be more than willing to write to him. I commend the regulations to the House.

On Question, Motion agreed to.