Rural Areas: Social and Economic Needs

HL Deb 03 March 1993 vol 543 cc666-704

3.8 p.m.

Lord Carter rose to call attention to the case for comprehensive and coherent policies for the social and economic needs of rural areas; and to move for Papers.

The noble Lord said: My Lords, the Motion which stands in my name on the Order Paper today calls for comprehensive and coherent policies for the social and economic needs of rural areas. Obviously it is a subject which has a wide range of facets. I know that speakers in the debate will wish to deal with those different aspects—education, housing, transport, and agriculture, or the special problems of Wales and Scotland. In opening the debate, I wish to set out an overview.

First, what do we mean by rural areas? The Office of Population Censuses and Surveys (OPCS) defines rural areas as the residue after urban regions have been defined. On that basis, about 80 per cent. of the UK land mass is rural; about 20 per cent. of the population live and work in the countryside, and less than 3 per cent. of the population—those engaged in agriculture and forestry—are the custodians of the visual and environmental aspects of the 80 per cent. of the land mass which is rural.

At the same time, a recent survey shows that 13 million people now living in towns and cities would like to live in the country and that 4 million people actually expect to move to a more rural area in the next five years. Forty-five per cent. of those surveyed longed for the open spaces of the countryside. Between 1981 and 1991, the census figures show that the fastest growth in population was in the remoter, more rural districts. But alongside this imagined rural idyll, there is the uncomfortable fact that 25 per cent. or more of rural households are living on or near the margins of poverty.

A recent survey of 10,000 rural parishes found that only 60 per cent. had a shop, only 3 per cent. had a public nursery, 94 per cent. had no day care groups for the elderly, and 60 per cent. had no primary school. There is real rural deprivation for some, but by no means all who live in the countryside. That is a fact of life which is borne out by many reports in recent years.

The biggest obvious change affecting the countryside is the decline in agriculture as a major employer, but with the paradox that agriculture, with an annual output of £12 billion to £13 billion, is probably still the largest single economic interest in the countryside. We know that nearly 100,000 jobs for farmers and farmworkers have gone in the past 10 years. Various estimates suggest that another 100,000 may go by the end of the decade.

This is a fundamental restructuring; it is not just a recessionary blip. As was put to me, we cannot expect someone who has worked on the land all his life to go off and retrain as a computer operator. For example, one little-remarked on fact about the proposed set-aside of agricultural land is the potential job loss resulting from a successful set-aside policy—if one could define success in terms of set-aside. The estimates vary from one job lost per 400 acres of set-aside to one job lost per 800 acres of set-aside. Whichever figure is correct, an effective set-aside policy can only add substantially to the problems of rural unemployment.

The job losses in the countryside do not just result from the decline in agricultural employment. In the seven years from 1984 to 1991 nearly 38,000 jobs were lost in rural areas as a result of pit closures. As one miner's daughter pointed out, coal is a culture, not just an industry. Whole communities have been dependent on that culture—the infrastructure of the village revolved around the pit. The pit was the great provider and when the pit goes, so do the support services, sports facilities, recreation facilities and social facilities.

My own district council in Wiltshire is a rural area of villages and small market towns with a population of about 67,000. The waiting list for homes is 1,754 families. The number of homeless families in temporary accommodation is 110. The cost of the bed and breakfast accommodation is £50,000 per year and it has been as high as £80,000, compared with only a few thousand pounds five years ago. There is no doubt that the local authority waiting lists considerably understate the housing need for single people and couples without children who often just do not bother to register.

In that same small rural district, the latest unemployment figure is 1,358—the highest for many years and again considerably understating the true level of unemployment. Two years ago there were 106 people unemployed for between six and 12 months. The figure now is 494, an increase of nearly five times. In May last year 217 vacancies were notified and in January this year there were 55 vacancies. We know that 35 per cent of Army wives in the district are able and willing to work but there are no opportunities for them and they are not even on the register.

I have already mentioned the increase in population in the countryside, but we know that that growth is not balanced in terms of age and occupation. The rural areas have a greater proportion of retired people and fewer children and people of working age than in the country as a whole. That has led to the phenomenon which has been aptly described by Professor Howard Newby as, "two nations in one village".

There is a real social stratification in rural society with one part of the rural population having less need for jobs, schools and public transport, thereby increasing the pressures on the rest of the rural community who depend on such things. The two-car family has little need of the village shop but 25 per cent. of the rural families in Wiltshire have no car. We know that many villages have thus become dormitory settlements rather than balanced social units.

However, when all the various social and economic problems that beset the rural areas are considered, there is one problem that stands out above all others. There is absolutely no doubt that the biggest social problem by far in rural areas is the lack of affordable homes to rent or buy. That view has been recorded and emphasised by report after report: the Duke of Westminster's study group; the Rural Development Commission; the Housing Corporation; the Association of County Councils; the Rural Housing Trust; the Archbishops' Commission report, Faith in the Countryside; and our own Select Committee on the European Communities in its report on The Future of Rural Societies. Paragraph 217 of that report states: The Committee were struck by the weight of evidence suggesting that the largest, and in some ways the most intractable problem affecting rural areas in the United Kingdom is the provision of adequate affordable housing for local communities". The report of the Archbishops' Commission says the same thing on page 95: One issue above all others—housing—has been at the centre of the evidence which we have received, especially on our regional and diocesan visits". We know that this problem is the direct result of the Government's right-to-buy policy for local authority housing, accompanied by the refusal to allow the local authorities to replace the lost houses.

If rural houses, as they become available, are snapped up by the rural incomers, thus pricing even the modest homes way beyond the reach of the working population, there must be a replacement supply of affordable housing if there is not to be a major social shift within villages.

That is exactly what has happened. It is a classic example of a popular, vote-winning policy bringing major socially undesirable results. The tragedy is that the Government could have achieved the objectives of the right-to-buy policy and prevented the worst social effects if they had allowed the local authorities either as enablers or as providers to replace the stock.

There are, of course, many other aspects of rural life that are affected by the social and economic pressures of living in the countryside. The village shop used to be an integral part of village life, but the spiralling cost of rural freehold property and the competition from supermarkets in nearby towns has drastically reduced the number of village shops. The Village Retail Services Association estimates that as many as a further 3,500 village shops are at risk of closing.

The National Federation of Women's Institutes says that its members identified the village shop and/or post office as the most highly desired amenity in rural areas. The situation of rural pharmacies is rarely mentioned, but the rules which govern dispensing by doctors can threaten the survival of the rural pharmacists who provide much more than just a dispensing service.

The problem of child care can be severely worsened by rural isolation, as can the situation of the army of informal carers looking after the elderly, the infirm or people with disabilities. The pressure to close community hospitals is intense in some rural areas, certainly my own.

Village shops, rural pharmacies, child care, informal caring, the closure of community hospitals are all examples of the many rural problems that may be small in terms of absolute numbers but where the impact on the local community can be very severe indeed. We know that sports, play and leisure facilities play an important part in rural life. We also know that many rural education authorities are considering whether school playing fields are surplus to requirements. The lack of leisure centres and play or activity schemes is a feature of many rural areas. I should declare an interest here as a trustee of the newly formed John Arlott Memorial Trust, which has been set up to raise funds for the Rural Housing Trust and the National Playing Fields Association.

Time does not allow me to cover fully what has been well described as a damaging web of problems. We know that systems and structures have been dismantled, thereby creating the pieces of an immense jigsaw for which there is no obvious blueprint or co-ordinated approach. Virtually every agency—both public and voluntary—which is working on rural problems mentions the the overlapping of functions and the lack of comprehensive and coherent policies mentioned in the Motion for today's debate.

As an example, consider a small businessman who is looking to expand, or a farmer who wishes to diversify, and who is located in a less favoured area which is also an environmentally sensitive area, inside a national park and part of a rural development area surrounded by a site of special scientific interest. It is perhaps a far-fetched example but it illustrates very well the plethora of agencies and policies which exist in the absence of proper co-ordination.

A vast amount of very valuable work is done by voluntary agencies which are grappling with rural problems. Much of the work is done by those very rural incomers and urban transplants whose arrival is part of the continuing social stratification in rural areas. I do not use the phrase "the urban transplant" in any pejorative sense. I was one myself. But the irony is that the very same people will also have the time to serve on the parish council and will then resist the low-cost housing which is required in their hamlet or village to replace just a few of the houses that they have bought up. We also know that they are the people who have time to serve on the planning committees. It has been well put that the attitude to planning in rural areas is much more protective of conservationism than it is developmental. In my view there is an overlapping mix of policies and agencies which should be co-ordinated to present a coherent front.

The need for a coherent approach has been emphasised, but the general concept embraces a number of rather different ideas. First, the broad objectives of policy, whether economic, social or environmental, must be clearly formulated, together with guidelines for arbitrating the conflict between them. Secondly, those broad objectives must be translated into specific programmes which will actually achieve them. Thirdly, resources must be allocated in a rational way, so that if the aim is, say, to support farm incomes or to promote employment, the means is chosen with an eye to cost-effectiveness for that purpose. I gave the example of the set-aside of agricultural land. Has anybody attempted to work out the unemployment cost of that? Fourthly, policy in so many different areas—agriculture, employment, education and training, housing, transport, and so on —must be planned within a coherent overall framework when decisions in one area so often have implications in another. Fifthly, different agencies, local or national, which implement policy must work smoothly together at a day-to-day level. Sixthly, and very importantly, the distinctive character of rural needs and rural problems must be given due recognition, even in areas such as housing, transport and education which straddle the rural-urban divide.

In the past there has been an argument for a department of rural affairs. It has not been accepted, even by my own party. But I believe that in time the argument for such a department will become even stronger. Far from fostering a coherent approach to rural policy, the present structure of government leads at best to piecemeal tinkering and, at worst, to an actual exacerbation of the conflict.

This immense subject requires a well planned combination of government action and voluntary effort. I know that other speakers will wish to deal with many aspects in more detail. I conclude with two quotations. The first is from the Prime Minister, Mr. Major, speaking at the Oxford Farming Conference in January 1991. He said: We do not want to see a population exchange with the less well-off in rural areas being driven into the cities by the absence of affordable housing and jobs in the countryside". One could wish that the policies of the Government were geared towards the objectives set out in that quotation.

Finally, M. Jacques Delors, the President of the European Commission, said: Rural development is a public good which corresponds to a fundamental need of society as a whole".

My Lords, I beg to move for Papers.

3.24 p.m.

Lord Shuttleworth

My Lords, I must at once declare an interest as chairman of the Rural Development Commission. The commission's task is to advise government on matters affecting rural England and to take action in partnership with others as appropriate for further development of those rural areas. Because of my responsibilities outside this House, I speak mindful of the Addison Rules.

I should like to thank the noble Lord, Lord Carter, for initiating the debate. I want to re-emphasise much of what he said. We do not disagree on the analysis. The Rural Development Commission does not always believe that rural areas, and more importantly rural people, get their fair share of attention. I should like to refer to three key issues which presently face rural areas in England. I shall refer to them briefly, because they were all mentioned by the noble Lord, Lord Carter.

In many areas the rural economy is facing substantial structural changes. As we all know, over the past 20 years the number of people employed in agriculture has fallen by about 40 per cent. As many as 100,000 full-time jobs in the United Kingdom may disappear in the 1990s. As many again may be lost in related supplying and processing industries. Half of those jobs, about 50,000, will be in rural areas.

Between 1984 and 1992, as we have heard, 40,000 jobs were lost as a result of the closure of rural collieries. Of the 30,000 mining jobs in the current review, over 10,000 are in rural areas. Again, the closure of defence bases and the run-down of defence industries will have a marked effect on many rural areas, including Suffolk, Wiltshire, the South West and my own county of Lancashire. It is ironically known as the peace dividend.

I also agree with the noble Lord, Lord Carter, that housing is another issue of crucial importance for rural communities, particularly affordable rented housing to meet local needs. A study carried out for the development commission in 1990 estimated conservatively that an additional 80,000 affordable rural homes were needed over the next five years; that is some 16,000 a year. We are nowhere near that number at the moment. However, I am delighted by the measures introduced by the Government to increase the supply of rural social housing. Those measures are welcome but, as I have suggested, more are still needed.

Access to services in the countryside is also a problem. Last year, as the noble Lord, Lord Carter, reminded us, the commission published the results of the first-ever survey of rural services in some 8,000 parishes in England. Looking at six key services we found that about 40 per cent. of parishes were without a permanent shop or post office. Nearly a quarter, perhaps sadly, were without a pub. More sadly, over half were without a school. There were 30 per cent. without a village hall, and 73 per cent. without a daily bus service. We would not argue that each of those services should be available in every village. But the survey shows that, even in the most prosperous parts of the countryside, life can be difficult for some groups of people, particularly those without a car.

So what can we do about the problems facing rural communities? What are we doing? The Motion refers to "comprehensive and coherent policies". The development commission has always believed in an integrated approach to economic and social problems. In each of the priority areas —the rural development areas, as we know them—we have introduced rural development programmes. These are integrated programmes of economic, social and related environmental action drawn up by local partnerships from the areas to which they apply. They involve county and district councils, English estates, the county rural community councils and other agencies such as the TECs. In 1990 we extended that approach to two new rural coalfield areas in the East Midlands. Last year we launched our new countryside employment programme in three pilot areas facing the challenge of severe agricultural change in order to help diversify the local economies.

These recent initiatives reflect the commission's evolution of a proactive role in tackling new economic problem areas. Parts of rural England need a regeneration agency just as much as the inner cities. The commission has launched a number of new or improved programmes in the past year geared very much towards helping businesses weather this recession and prepare for new growth. Our business service has launched new advisory packages. We have greatly expanded our marketing grants. We have launched new grant schemes to encourage TECs and local enterprise agencies to provide more business advice and training in rural areas. Last year we expanded the scope of our redundant building grants scheme which provides economic environmental benefits most cost-effectively. We have continued to expand our social programmes. For example, we have funded a range of demonstration projects in child care and training for women which, among other benefits, improve the currently poor prospects for rural women of finding work.

Last but not least we have launched a grant scheme to help village halls cope with the costs of complying with new health and safety regulations. I must add that the burden of regulation is now one of the biggest bugbears of rural businesses and charitable bodies. The Government's renewed determination to reduce those, burdens is very welcome. We shall monitor progress closely. I hope that those brief examples will demonstrate to your Lordships that the Rural Development Commission takes a comprehensive view of its responsibilities and promotes an integrated approach to rural problems.

I should like to stress one final point that lies behind this Motion; namely, that preserving and protecting the physical aspects of the countryside, flora, fauna and landscape is all very well, but in itself does not safeguard the countryside's future. To do that we must above all have regard for the people—people who need jobs, homes and services.

3.31 p.m.

Lord Beaumont of Whitley

My Lords, we are deeply indebted to the noble Lord, Lord Carter, for moving this Motion this afternoon. Many noble Lords, particularly those who will speak in this debate, deeply regret that more time could not be given to it. There is a very short time at our disposal in which to deal with a very important subject. Although I am the third speaker, as can be seen, I do not speak for the Front Bench of my party. The noble Lord, Lord Geraint, who will wind up the debate, will undoubtedly say such things as need to be said from the party's point of view.

I imagine we all agree that the rural areas of this country are suffering from pernicious anaemia and poor circulation. There is no shortage of suggestions on what is needed to alleviate the symptoms. Most of those suggestions are good. As has already been said, action is desperately needed in the areas of housing, transport, and many others. But the disease goes very deep and relief of symptoms is not enough. We need to tack the malaise at its root. The truth is that the countryside in any nation cannot be healthy without a thriving, effective and populous agriculture. If one needs to look at the state of our agriculture today, one has only to read the extremely good speech of the noble Lord, Lord Palmer, last Wednesday.

Britain has been blessed and cursed with a very efficient agricultural system. It has been blessed because it was able, among other things, to bring us safely through the war and blessed because it has paid off for many years in a monetary bottom line. Britain has been cursed because ever since the agricultural revolution we have been travelling down the path of measuring prosperity in monetary output per worker, and the logical conclusion is the anaemic state of the countryside today. We have missed out on healthy peasant farming which has been the glory of most of Europe and which was the policy beloved of our Liberal forbears, of Hilaire Belloc and G. K. Chesterton and the people who preached the Liberal doctrine at the turn of the century, including Jesse Collings who spoke for the countryside from the Labour Party. We have missed out on that, although it is just possible that Spain and Italy are now just beginning to tread the somewhat ruinous path that we have trodden.

Those of us who read The Times on Saturday know, from reading the entertaining life of Paul Heiney, the possibilities of small farming. Of course it does not pay and it has to be paid for by his journalistic efforts. But we should find some way of making that kind of farming pay. Earlier last year the Prince of Wales spoke to the RASE and pointed to some of the ways forward. SAFE, the campaign for Sustainable Agriculture, Food and the Environment, has produced a 10 point programme which I commend to your Lordships' attention. I shall briefly mention six of those points. I emphasise that this is a plea for the kind of agriculture that we should have throughout the EC.

First, there must be a farm support system which sustains rural employment. I may be wrong but I thought that the noble Lord, Lord Carter, suggested that we did not know the effects of set-aside. I understand that some research has been done and it has been suggested that one job is lost for every 130 hectares put into set-aside. We must have a farm support system which encourages employment. We must have a farm system that controls surpluses by rewarding environmentally friendly farming systems. We must have a farming system that encourages lower outputs—low farming rather than high farming—and avoids much of the damage done by energy-intensive farming. We must have a farming system that produces protection for wildlife habitats; a farm support system that encourages the restoration and creation of such habitats; and a farming system which militates against the inhumane treatment of farm animals. All that is done by a low farming system.

In conventional terms that is expensive and we are financially a poor country—over the past few days I have heard many speeches implying that we are a rich country; but we are a poor country with a lot of rich people. It will be argued that we cannot afford such reforms. But a country is basically prosperous or not depending on whether it can provide a satisfying life for its citizens. Part of a satisfactory life in Britain and Europe is a stable and satisfied rural population. For far too long we have calculated the bottom line only in pounds and pence (previously in shillings also). It is time that we started to calculate in terms of human values a proper relationship between man and his environment and even aesthetic satisfaction. But if we continue as we are doing, in the words of the prophet, "we shall make a desert and call it peace."

3.38 p.m.

Lord Northbourne

My Lords, we are all grateful to the noble Lord, Lord Carter, for bringing this very important subject to the attention of the House. We are not alone in this country in having problems in our rural community and with farming. I have with me a report which was published in November for the French Senate. It draws attention to the problems of what the French call their "rural spaces". It lambasts the French Government with a ferocity almost equal to that of the noble Lord, Lord Carter, this afternoon. Perhaps some of your Lordships heard the debate between M. Mitterrand and a number of Frenchmen just before the referendum on Maastricht. A French farmer tackled him, claiming: "You are destroying the farmers of this nation; it is genocide!"

This afternoon I want to speak briefly about the problems of the British farmer. Many people in this country perhaps do not realise what the farming industry is going through. Unlike the miners and French farmers, we do not go out and burn trucks on the road and parade through the capital with our tractors and combine harvesters.

I am told by the NFU that over the past two years more than 13,000 farmers and farm workers have left the agricultural industry. The Samaritans have had to set up special units in the countryside to deal with calls from farmers because there have been so many rural suicides. The important point is that British farmers, unlike French farmers, are not resistant to change; but sometimes circumstances are such that they do not have time to make changes. Farmers live by the rhythm of the seasons and of the life cycle of the animal population. It is therefore difficult, if not impossible, to make rapid changes.

I should like to look at the question of what the urban majority in our country want from the farming community. That is what the farming community want to know. If they know and are given time to change, they will respond. I believe that what the urban population want—put crudely —is cheap wholesome food and a picture book countryside. I suggest to your Lordships that the two are simply not compatible.

Picture book farming is today an expensive way to produce food because of the march of technology and the reasonable expectations of those who work on the land. When I was a boy my father farmed under 1,000 acres and employed 35 men; today we farm over 2,000 acres and employ 3.5 men. Agricultural wages in 1940 were £3.6 per week—£63 at 1992 values; today, wages are on average £216 per week. That is a change we cannot reverse. We cannot expect those who work on the land to go back to 1940 wages; we cannot turn back the tide of technology.

What can we do to produce cheap wholesome food in a countryside whose appearance is acceptable? The French Sénat report suggests four measures. First, that the Government should define clearly a national policy for the future of the countryside; secondly, that they should open up new outlets for agricultural production—the report refers particularly to the possibility of producing fuels from agricultural products—and thirdly, that the Government should put in place a plan to relieve agriculture of some of its tax burdens. I must admit that that looks to me like a hidden subsidy; what price the level playing field? Fourthly, the report recommends the development of industry and business in the countryside as a source of alternate income for people living in the countryside. There are lessons we can learn from those proposals and perhaps the last of the four is the most important.

In my view, in seeking a long-term solution to the problems of the countryside and the farming industry, we shall need to differentiate between areas with soils of different productivity potential, different climates and different landscape values. I suggest that in areas with a high potential for high-yielding crops or grazing and with suitable topography, farmers should be encouraged to practise highly efficient, low unit cost agricultural food production. Those are the areas which would produce most of the country's low cost food and help with our balance of payments.

By contrast, in areas of exceptional national beauty where small farmers predominate, farmers can be subsidised to practise traditional and picturesque farming methods—what I might call "Mrs. Tiggywinkle farming"; a kind of open-air museum of farming the countryside. In areas of the Lake District, or parts of Devon or Wales that might be justified and the public may be prepared to pay the not inconsiderable cost.

In areas of poor or steep land I believe that forestry must be an important element in the solution. Finally, on all the land that lies in between I believe that we must look at extensification and, above all, at part-time farming. Part-time farming is the only way in which we can keep people in the countryside, enable them to participate in relatively small-scale farming and, at the same time, enable them to earn a reasonable living wage.

Whatever the policy is to be, I plead with the Government and all political parties to work together so that we do not have changes every time there is a change in political influence. Farming cannot be a political football; it takes too long to change direction. Finally, and in sympathy with the noble Lord, Lord Beaumont, I remind your Lordships of the words of Jean Jacques Rousseau, Agriculture is the first and most admirable of all the Arts".

3.45 p.m.

Lord Vinson

My Lords, we are indeed indebted to the noble Lord, Lord Carter, and I am particularly so because for 10 years I was chairman of the Rural Development Commission between 1980 and 1990. I have little to add to his comprehensive survey, nor to that of my successor, my noble friend Lord Shuttleworth—except perhaps on one or two points.

The perception of rural life is often quite different from reality. One of the tasks of those of us concerned with rural affairs is to illustrate the essential difference between living in the country and living in the town. Distance and sparsity have an inescapable effect on the rural dweller. It is around those two factors that any government policy specifically aimed at rural areas should be framed.

Your Lordships will need no reminding that it is not uncommon in rural areas for people to have to travel 40 miles to visit granny in hospital—a round trip of 80 miles; to travel seven miles for a hair cut; to go five or six miles to the nearest village store where inevitably the costs are higher than those in the supermarket. The car has emancipated the rural dweller. To him it is not a luxury, it is a necessity. I make this point particularly because when we speak of broad-brush policies to reduce CO₂ emissions by increasing the cost of energy, the rural dimension needs to be remembered, and the substantial extra cost that a rise in the cost of fuel would bring to the rural dweller. It is something that all of us who take any part in formulating policies should keep in the back of our minds.

There may be some policies that can and should be specifically aimed at the rural dweller. But there are also a number of policies that constrain the economic development of rural areas and constrain the natural development of alternative jobs in rural areas, in exactly the same way as they constrain them in urban areas. Therefore, before we look at specific new initiatives—one initiative to pile on another initiative —it is important that the Government examine the framework within which the economy works and within which the rural economy works.

Perhaps I can give two examples. When I was chairman of the Rural Development Commission we came to the conclusion that the best thing we could do was to encourage local enterprise, recognising that most of the businesses one finds in rural areas were started by people who lived in those areas in the first place. The natural thing to do therefore would be to cherish the acorn and try to help it turn into an oak.

Such businesses needed somewhere to start, and yet 10 years ago there were draconian planning regulations against the use of redundant farm buildings and against people working from their own homes. Our agency, along with others, quietly nibbled away at that concept, and I believe that literally hundreds of thousands of new jobs have been created in rural areas—not because of government but in spite of government. We must remove the constraints that prevent jobs from happening spontaneously and organically. That is why, in the formation of policies, one should stand back and examine the situation widely.

We looked at a second initiative, one which again did not apply wholly to rural areas. We recognised that lots of people would have liked to have been their own boss and would have liked to have started their own business; but they had the desperate problem of how to start their own business and yet not be accused of moonlighting while they lived on the dole. The solution was very simple—to legitimise moonlighting under a scheme called the Enterprise Allowance so that those people could go on drawing the same money, in effect, as the dole. The change of name to the Enterprise Allowance from the dole opened up a whole new range of opportunities and gave people a financial life-line to start their own businesses. It was responsible for the creation and sustenance of hundreds of thousands of businesses both in rural and urban areas.

In trying not to dwell on many of the subjects that have been touched on already, I should like to suggest three more initiatives which I believe could be applied just as well to urban areas as to rural areas.

We are all anxious about unemployment yet we regard employment as being a full-time job. The laws are so structured that if one takes a part-time job and one is already unemployed, the hassle of deregistering and then reregistering makes it almost impossible to take a temporary part-time job. Yet, particularly in rural areas, there are masses of part-time jobs.

Only this week an instance came to my knowledge of a girl who is 23 and unemployed. She volunteered to become an assistant shepherdess during lambing. As noble Lords will know, there is always a demand for pairs of hands during lambing. A deal was struck offering her £250 a week for four weeks—£1,000. She came back five days later and said, "I have discussed this with social security and, frankly, if I come off unemployment benefit, I shall be worse off as I shall lose my mortgage subsidy, my child allowance and all the other things. I cannot afford to take it, even at £250 a week". It is madness to have constraints on natural re-entry into the labour market via the part-time route.

We should not be driven by self-imposed regulations that prevent the market from working naturally. We should re-examine this whole area to see whether some concessions cannot be made in this field to allow quicker deregistering and reregistering on and off the unemployment roll or an allowance as applies to old-age pensioners; say where the first 50 per cent. of earnings for those who have been out of work for a reasonable period are disregarded. We must free up the existing barriers to re-entry via the part-time labour route.

My second point concerns the question of how small businesses finance themselves. Uniquely in this country, we have a system of accountancy that taxes working capital. As a small business or a small village shop expands, its stock and work in progress goes up. That is regarded as profit if the business is profitable overall and it pays tax of 25 or 30 per cent. on its increased stock holdings. It pays tax on its working capital. All business costs are ultimately allowable. If the same business then goes out to buy a small computer, instead of that cost being allowed in the year in which the expenditure occurred, the cost is spread either over four or seven years. In other words, the recovery of that cost, while allowable, does not happen at once. In the year it expands, that business has to pay both for its new investment and tax. Other countries look at this quite differently and enable companies to be exonerated from tax on increased working capital. It would be perfectly possible for us to do that in this country in the same way up to a maximum limit.

Last but not least—I apologise to the House for over-running my time—is the question of overregulation. It has been said to me that it is impossible to run a small farm or business today without breaking the law. We must bring in more de minimis regulations for small businesses. Many of them feel like Gulliver in Gulliver's Travels. No one silken thread holds them down but thousands of them prevent economic activity that should properly happen from happening. I believe that there are areas that the Government could look at, where deregulation and a change of existing regulations would emancipate businesses greatly to the benefit of the economy whether they be in rural or urban areas.

3.54 p.m.

Lord Stallard

My Lords, I too congratulate my noble friend on initiating this debate and on the way in which, from his obvious expertise, he introduced it. He has probably saved many of us a lot of time in our own speeches.

We do not often get the opportunity to discuss in any detail the social needs of rural areas. It is sad that noble Lords have only seven minutes, but in the few minutes available to me I should like to say something about the housing needs of rural areas. We tend to relate all the problems connected to the acute shortage of housing to urban areas and we seldom realise that those same problems exist in some lesser or greater degrees in rural communities. It is fortunate for me that recently the all-party group on homelessness had two speakers from the rural areas. We had a speaker from Action for Communities in Rural Areas, Miss Catherine Chater, and a speaker from the Association of District Councils, Mr. Graham Facks-Martin. We were brought up to date reasonable well by those two speakers.

Research by ACRE on behalf of the Rural Development Commission in 1990 indicated that, after taking account of re-lets, there was an annual shortfall of rural social housing provision of between 23,000 and 37,000 units. That is a massive shortfall when one considers the size of the problem in the rural areas. Graham Facks-Martin of the ADC said: It must be stressed that the root cause of the homelessness crisis is the inadequate provision of social housing, and should not be blamed on anything else. In the six years prior to 1991–92 the amount of social housing built was down to 30,000, from 80,000 in the first three years of the decade". Local authority waiting lists significantly underestimate need, particularly in communities where they have little stock to offer. Those who are not classed as in priority need—single people or couples without children—tend not to register at all. There are many people in that category who do not show up in the records.

Homelessness in rural areas is increasing at a faster rate than in urban areas, according to a recent report, Homelessness in Rural Areas, by the Rural Development Commission. In the four years to 1992, the incidence of homelessness has tripled in deep rural areas. We know too that many homeless people who originate from rural areas often seek accommodation in large cities—we certainly know of that problem in London—but even so it is clear that increasing numbers of people are now sleeping rough in rural areas as well. They may not be as obvious as they are on the Embankment. They are not sleeping on the streets but they are sleeping in cars, in garages—sometimes garages are let to people to sleep in—and in tents.

The report Homelessness in Rural Areas, produced for the RDC by Glen Bramley at the School for Advanced Urban Studies in Bristol in 1992, found that rural authorities tended to be stricter in their interpretation of the statutory homelessness legislation. For example, people encountering mortgage repossession, living in inadequate mobile homes and those living in short-term lets were seen to be intentionally homeless and therefore councils did not have a responsibility to provide housing for them—otherwise, the numbers accepted would be even larger. In Cornwall, for example, it was found that it was common for people living in short-term, six-month, winter-let accommodation to be made homeless when their accommodation was let as holiday accommodation for the rest of the year. The report also found a worrying increase in the use of bed and breakfast accommodation by rural local authorities which previously had not had to use it at all to house homeless people.

It has already been said that over a million council houses have been sold through the "right to buy" policy since 1980, which is nearly a quarter of all stock. In some rural communities the proportion is much higher without a single vacancy occurring from one year to the next. For some time local authorities have not been in a position to replace their stock directly because of financial restraints.

Housing associations have made some contribution, but still the shortfall remains and worsens. Until the recent collapse of the housing market, house prices had been rising rapidly and were beyond the means of the majority of those in rural communities. Another report found that 55 per cent. of new households in the under-30s age group could not afford to buy a new house and that 75 per cent. of large families had no option but to rent.

The Housing Act 1988 abolished fair rents, creating assured tenancies where the prevailing market sets rents. Those rents are dictated to a large extent by fluctuations in the housing aid grant schemes. I understand that housing association grant schemes are about to be further reduced. From 75 per cent. in 1989, they are now currently running at 71 per cent. and going down during this current year to 67 per cent. It is estimated that it is the intention to reduce them to 60 per cent. and then 55 per cent.

Those changes will create a dramatic increase in rents. The percentage of rent on a 67 per cent. grant is 30 per cent. of the net income; on a 60 per cent. grant the figure is 32.6 per cent. and on 55 per cent. the figure is 34 per cent. When one considers that the aim of the housing associations is a grant of 25 per cent., one can understand how very unaffordable these homes are going to be. Therefore I hope that the Government will consider the overall effects of all those various aspects of the rural problem and that they will initiate changes along the lines suggested by my noble friend Lord Carter.

4.2 p.m.

The Earl of Radnor

My Lords, I too am extremely grateful to the noble Lord, Lord Carter, for bringing forward this debate. I believe that rural affairs in this context are every bit as important in their own way as urban affairs. I know the noble Lord well enough to appreciate that he knows a great deal about this subject. I also listened very closely to his overview which summed up the situation as it stood. I believe that he did that very well indeed.

I disagree with only one aspect that he emphasised as being the most important matter—that is, affordable housing. I would put unemployment first and then affordable housing. By unemployment in the countryside I mean the person who used to work in the countryside and who is, in a way, pinned to it either because of his housing or lack of a motor car, his skills or some such reason. I do not mean people who now treat the countryside as a dormitory. There will be many more of those in future.

Perhaps I may start—it is not because I sit between my noble friend Lord Vinson and my noble kinsman Lord Shuttleworth—by talking for a moment about the Rural Development Commission from the outside rather than from the inside of the agency. The nearest that I come to it is reading its report. I have said before in your Lordships' House that the commission is of prime importance in the countryside. There is a case for widening its remit and giving it a little or even quite a lot more money.

Re-reading last year's report I was a little disappointed to see that it concentrated on rural development areas—no doubt it picked them with great care because of their special poverty—but we are now dealing with poverty and a degree of deprivation over a large proportion of the country. I believe that there is a very strong case that the commission should be expanded. All its duties are well done. Going back to my employment theme, it has an extremely important role to play in that regard.

Perhaps I may now turn to the Government's duties. We have heard about the Prime Minister's speech at the Oxford conference. Reference was made to different provisions for employment in the countryside, such as workshops and factories and so on. That should not be inhibited by the planners. I rather doubt whether those words actually got down to grass roots level. It is very important indeed that influence should be used to ensure that redundant farm buildings, if they are wanted, are capable of being made into workshops or small factories. In addition, if someone has the initiative, money and, possibly, the help, he should be allowed to build a small workshop anew. Those measures would do a great deal to revitalise the country and perhaps take advantage of a faint rise out of the recession which surely must come some day.

Perhaps I may also mention retraining. Although the agricultural worker is an adaptable man, it is very difficult for him suddenly to jump into another and totally different job. The remit of the Agricultural Training Board might be altered to show that its duties are not confined to training people for agricultural duties, but to retraining them for other duties and employment.

The point I made at the beginning of my speech as regards unemployment was occasioned by narrowing farmers' margins and, the final blow, the 15 per cent. set-aside. The set-aside land is allowed to be used for non-food projects. People rack their brains as to what that might be. I am told that there is an area the size of Norfolk which employs nobody at all.

My suggestion is that the situation provides an excellent opportunity to practise forestry. We have a declining forestry business. I ask the Government whether they can once more look at the grant structure of private forestry to encourage people to plant trees in areas where it is suitable so to do. At the moment the grants look reasonably robust, but the taxation advantages run out this April. When those were taken away—I sometimes feel that that was done to spite a few rich people—planting stopped. The Government have a completely arbitrary target, I believe, of 35,000 hectares per year. I believe it should be greater. That target has never been hit. They do not seem to take notice of the time it takes for trees to reach even production let alone profit levels.

The present grants do not acknowledge the fact that if 15 per cent. of land is to be put to forestry its asset value will drop from, say, £2,000 an acre to about £300. I ask most earnestly that the whole matter of forestry be looked at again with the possibility of re-planning the system to what it was before and at least increasing grants. More importantly than anything, those grants should be indexed because they are eroded by inflation and people do not trust them any more.

Finally, I make a plea that the bias that exists towards the green idea of every tree being of the deciduous variety should at least in part be reversed so that we can once more get going with a proper forestry industry.

4.10 p.m.

Baroness David

My Lords, I shall speak about village schools and I shall start with a quotation: Whitehall bureaucracy is totally unsympathetic and even fundamentally opposed to small schools … Concessions have had to be wrung out of a reluctant bureaucracy. It seems a pity that politicians in London seem quite unable to lift their eyes to the horizon to see the good things going on in rural communities. They are not able to contemplate rationally the havoc they are causing in the heartlands of the nation". I have been quoting not from a Labour politician or from a Labour pamphlet but from a "high Tory" (so he describes himself) who is chairman of an education committee.

In the debate today we are talking about very important values. In a village there was, once upon a time, the church, the village store, the village inn, the post office and the village school. The church may have been made redundant or, to use the fashionable word, "clustered" with neighbouring parishes. The post office and the stores have too often vanished. The school is in danger and, with it, the community education and activities that can go on in the building after 4 p.m. and at weekends: the activities that make for the cohesion of the community.

I know well the arguments for closing small schools. I faced all the problems when I was vice-chairman of Cambridgeshire Education Committee. I can reel them off: the dependency on the head and perhaps one or two teachers who may have been there for years. Is it right to leave a child with an inadequate staff for three and perhaps eight years of his or her schooling? Will there be the stimulus of a varied enough peer group to produce the interactions a larger number of children from different backgrounds could bring? Will it be possible to present the national curriculum? What about games? What about PE? What about music? Will pupils from a small school feel uncomfortable when they move to a secondary school? And what about the cost?

The supporters of small schools have answers. The cost may be greater, but there are costs in closure and in transport. There are, sadly, accidents. In Somerset a girl of 10 was killed in tragic circumstances. The coroner's court heard that an eight year-old boy had been in the front seat operating the door. Not all authorities have a strict policy of using only properly licensed vehicles and drivers. There are great advantages in being community based, and many say that these outweigh the disadvantages, which anyway can be overcome. Peripatetic teachers can be used. It is easier for one teacher to travel than for 20 or 30 children. So long as LEAs exist, INSET for teachers at teachers' centres can help the isolated teacher enormously.

Many heads say that they can deliver the national curriculum and in fact have been doing so for years. In response to a department document, Curriculum Organisation and Classroom Practice in Primary Schools, which queried the effectiveness of small schools, the ACC said that counties overwhelmingly reported that small schools could deliver the national curriculum so long as they received support. Several in fact felt that it was in the smaller schools where the planning and introduction of the national curriculum had been most effectively achieved. However, there are other heads who say: "Can any school deliver the national curriculum?" One thought it overcomplicated and overloaded. Another thought the problem was not the national curriculum but the unnecessary documentation. Dr Burstall, the director of the National Foundation for Educational Research, having examined all the small school HMI reports for a three-year period from October 1983 to October 1986, said that one point emerged clearly. I quote: No evidence is presented in the reports which supports the view that a small school per se is inherently disadvantaged from an educational standpoint". Many authorities—and Cambridgeshire was one of them—started to develop sharing arrangements between the schools, often trading under the general description of "clusters" or "federations". These are not cheap either but may go some way to compensate for the curriculum isolation that small schools may suffer. The White Paper of July 1992 proposed that small schools could opt out in a group. It states: Any small primary school will be eligible to apply for grant maintained cluster status together with at least one other primary school, including those in neighbouring LEAs. It is expected that schools with fewer than 100 pupils will benefit most from forming a cluster". Such is the Government's enthusiasm for an energetic pursuit of opting out. The ACC did not support the proposal and queried whether the clustering would allow more economic provision. Where authorities had introduced clustering it was clear that co-operation between schools depended not only on an area's geography but also on what was acceptable to small schools and their communities. In every case, though, the role of the LEA in establishing clusters and in providing extra funds to support the arrangements and to give advice had been essential.

There was not much enthusiasm for "federation", as suggested in the White Paper: that is, the creation of a multi-site school under a single head and with a single governing body. However, the Government's proposals appear in Clauses 109 to 119 of the Education Bill, shortly to make its appearance here. I would like to issue a warning based on the Cambridgeshire scheme to link four schools. All four were closed, with the approval of the Secretary of State, using Section 13 of the 1944 Act. When, later, the committee decided to end the federation it was able to close two of the schools, with no legal obligation to fulfil to the communities concerned. They were powerless: so beware.

Closing schools is a very emotive topic and it invariably attracts strenuous opposition. There is an example from Devon, where a school with 12 pupils was proposed for closure. Parents unanimously voted for grant maintained status. The closure proposal and the grant maintained application sit on Mr. Patten's desk. His decision will be of interest.

The cry from the department is, "Get rid of surplus places". A government adviser was complaining that money was being thrown away on school buildings where there were surplus places, and was quoting village schools as a clear example of that. It has been suggested that Ministers have been afraid to risk the wrath of the Tory village schools lobby. In fact it is not village schools, even thousands of them, that would make an appreciable difference to the total—1.5 million—of surplus places. One may have to conclude that this is just another ploy for taking village schools away from village communities. Rural communities must not be sacrificed in an attempt to minimise urban schools' surplus places. As the National Association for the Support of Small Schools said in a recent newsletter: Let every village school display its number of surplus places outside for all to see. That will tell all". One final point is causing anxiety in rural areas: if the cost of transport is delegated to schools, how is this to be managed fairly? Apportioning the cost will not be a simple matter; in fact I think that it will be a very complicated one. I hope that the Minister will be able to give some reassurance about this. I look forward to discussion in Committee on the Education Bill, and I beg the Government to listen very carefully to the arguments for retaining village schools. I would remind noble Lords of what my noble friend Lord Carter said: that according to a recent publication, Regional Lifestyles 1992, 4 million people plan to move to the country in the next five years, and younger age groups are particularly keen. Schools are going to be needed.

4.18 p.m.

Lord Wade of Chorlton

My Lords, first I should like to thank the noble Lord, Lord Carter, for having introduced this debate, and particularly for laying out the facts of the rural economy so clearly. These are factors which are often misunderstood by those who come to talk about this subject. I must declare an interest in that I am chairman of the Rural Economy Group. In recent weeks we have had presented to us a number of different views, all connected with the rural economy.

The first view considers the whole of the economy and structure of Great Britain. It argues that it is time to revise the received wisdom of always trying to regenerate our cities, on the basis that cities grew because they were economically viable and because there were certain needs that brought people together to work and invest in a particular area but that now the needs of the people have changed. There again the reference to the fact that many people now want to move from urban areas shows that that is changing. We need to look now at the demands of where investment wants to go rather than trying to push people into an area where they do not want to go so that they have to be given great incentives to move, and where we have seen in the past enormous failures of investments that have been made by taxpayers to attract people to areas where they did not really want to go, and they very soon left. Many of the declining areas in our cities are the results of such policies. Following that, the view was taken that we should look again at all our economic resources, and to a much greater degree encourage or allow investment to be made where the investors wanted to put it.

Another point of view takes that a little further. It has recently been advocated by the Economic and Social Committee of the European Communities, which has been asked to look into the problem of rural communities in Europe. I should like to quote three short paragraphs that explain the view that the committee has taken. The first states: The Committee emphasizes the need to reverse the trend towards an even higher concentration of population in major urban centres … a situation already criticized in the Green Paper on the Urban Environment". The second states: In this Own-initiative Opinion, the Committee aims to put together proposals on how to provide residents of rural and extra-urban areas with high quality structures and services on a par with those found in cities and geared to the areas concerned". The committee then stated: Europe needs a determined policy for planning and developing rural areas. The policy of rural depopulation and excessive population concentration in capital cities and a number of regional cities must be stopped". I recently had discussions with a new organisation that has been set up to bring together a consortium of rural training and enterprise councils. These TECs are primarily involved in the rural areas and are deeply anxious about the problems of training, to which my noble friend referred, and about how we can stimulate opportunities for younger people, especially in rural areas. I found the existence of that organisation very telling. It reflects the way in which this problem is hitting closely at those TECs.

The right reverend Prelate the Bishop of Chester (who is in his place) has coaxed me into becoming involved in trying to save the declining churches in the rural areas of his diocese. Perhaps there is no better illustration of what is happening now in rural areas than the fact that in previous centuries we have been able to raise the money in rural areas with which to build splendid, fine churches, but we are now finding it extremely difficult to raise enough money from our populations to keep the glass in our church windows and doors.

The other view that I have heard expressed is that we should attach only one prime aim to our rural areas—that is, the importance of the environment. Many bodies of opinion in this country hold the strong view that the environment is of prime importance in rural areas and that the market should not dictate what should happen there. That view says that we should not consider the needs of the people or the businesses who might want to go to those rural areas, but should consider primarily the needs of the environment. Such people believe that our prime responsibility is to get the countryside to look—as the noble Lord, Lord Northbourne, has said—as it used to look 100 years ago. Such people say that we should set out a planning programme that will ensure that we do not encroach on our rural areas.

In tackling this problem, we must understand the dilemma facing the Government. There are two very extreme views on the economy of our rural areas. I know that some noble Lords participating in this debate rightly have the view that economic considerations should be paramount; but others feel equally strongly the other way. There is a way to reconcile those two views. Even if one allows some development and investment in rural areas, encourages growth and encourages people to find other ways of creating wealth (which the decline of the agriculture industry has made so necessary) that can be done without spoiling the rural environment. We could still leave vast areas of Britain's beautiful countryside completely untouched.

When we refer to the necessity of encouraging further investment in order to provide services for an extra 5 million people, we are really only talking about developing the margins of our existing country towns and villages. There is no need to create new towns in rural areas. There is no need to create vast new industrial complexes. However, what there is a need to do is to realise that the economic aspect of what we do in our rural communities is as important to the nation as what we do in our cities.

Britain's future will depend upon us being the most efficient producer of everything that we produce. But one cannot be an efficient producer if one pays people not to produce on their efficient land while giving them a subsidy to produce on their inefficient land. That is a sure recipe for destruction whatever the industry, yet that seems the overriding policy that the environmentalists have imposed upon the Government. The Prime Minister has declared clearly for such a change, as have many Ministers. In my view, the Government have taken a very positive step forward in PPG7, which is a new attitude to planning. They must now build on that and think in terms of what is right for the nation and industry as a whole. They should not be influenced too much by those small pressure groups which do not necessarily feel that it is their responsibility to think in terms of the nation, but only of their own point of view.

4.25 p.m.

Lord Underhill

My Lords, the noble Lord, Lord Wade of Chorlton, rightly stressed the economic situation of the rural areas. However, any economic development would be useless without satisfactory transport—and it is with the question of transport that I should like to deal.

The lack of adequate transport makes staying in the rural areas very difficult for various categories of people. There are those who for various reasons want to stay but who, because of the lack of facilities to which my noble friend Lord Carter referred in the excellent and comprehensive speech with which he opened the debate and because of the lack of transport, feel that they have to leave even though they may have been born and bred in a particular village. This applies particularly to the young families we should like to see staying in the countryside. I understand that some 5 million women live in rural areas. Many of them do not have a car or access to one during either the day-time or the evenings. The same applies to quite a number of elderly people. If transport is not available, such people feel isolated and denied the things that make up the quality of life.

The noble Lord, Lord Vinson, pointed out that a car is not a luxury in a rural area; it is a necessity. However, despite the general increase in car ownership, many people cannot afford to buy a car or to pay the running costs. That is particularly the case given the long journeys that are necessary in rural areas, especially to reach employment. Many people find that the running costs are an unbearable drain on the household budget, especially as wages in rural areas are often on the low side.

In many rural areas there is little or no public transport. Where there are bus services, they are regularly axed at evenings or weekends. The services are often infrequent. As many noble Lords know—I have experienced this when travelling around—there may be only one or two buses a week. That is a problem for many people in rural areas. Where there is a bus service, it must be regular, reliable and properly timetabled. There may be a long walk, sometimes of miles, to reach the bus stop or pick-up point. That distance can often only be covered with the help of a friendly lift. To say the least, it is annoying to make such a journey (either walking or with a lift) only to find that the bus has left, that the timetable has been changed, or that there is no bus because the operator does not have a reliable reserve vehicle to replace one that has had to be taken out of operation. That is one of the problems of deregulation and is, I believe, increasingly a problem in rural areas.

I turn now to the present position of the county councils. As their budgets do not allow them to subsidise all the bus routes that might be required to cover the rural areas, consideration must be given to other less conventional means of transport. Where there are school buses, these could be made available to other passengers. There is, however, the problem of the school holidays, so consideration would have to be given to how such periods could be covered.

Then there is the maximum possible use of post buses. I have had the pleasure of at least a couple of dozen holidays in rural areas in the north-west Highlands, and I know the value of the post buses to the community there. Without them there would be no transport at all. That system should be developed as much as possible. Of course there is a possible threat to the Royal Mail and one dreads to think what may happen to many of the post bus services which are such a boon to the people in the rural areas.

Every possible help should be given to enable community transport to be provided. This may be done with minibuses given by village or voluntary organisations. There must be an effective rota of voluntary drivers. Car sharing can be of help, but often the person desiring the lift finds that the times which suit the person offering the car sharing are inopportune, and that is another difficulty. Provision of transport for tourism can be of considerable help. But then we have a further problem outside the tourist areas.

Rail services play a useful but limited role in the rural areas. Only a small percentage of villages have either a station or a rural halt. Services mainly provide travel to, and between, the larger towns. Of course we have the services provided by certain metropolitan authorities through the Section 20 grants. These pay for rail services many of which go into the rural areas. They are operated by British Rail's regional services. What may be the position if the threat of rail privatisation becomes a reality one dreads to think.

Full consideration must be given by the county councils in particular and by district councils to the question of transport. Reference has been made to the need for integrated policies. Consideration of development plans should be linked to transport needs and how to make provision for them. I should like to think that in each county council there was a section devoted solely to transport with a view to assessing exactly how to cover each rural area and, where one cannot be covered by public services, to deciding what encouragement will be given to ensure that community services are brought into being. The aim must be to cover every part of every rural area with the best transport we can, whether by means of conventional services or of unconventional services.

I was very interested to hear the noble Lord, Lord Shuttleworth, and the noble Lord, Lord Vinson, who I believe was his predecessor as chairman of the Rural Development Commission. I know little about the work of the commission, but I am always happy to receive its Rural Focus. I find that the work it is doing is of considerable interest. As a statutory body, that work is of great importance, but it needs to have adequate resources to do its job. The elected regional councils whose establishment the Labour Party is urging could, along with the commission, play a great part in developing transport.

The aim must be to have adequate transport: without it, life in the rural areas becomes almost impossible because of the feeling of isolation. If we cannot provide proper public transport facilities, then every encouragement must be given to the development of unconventional services.

4.33 p.m.

The Earl of Bradford

My Lords, all those living in the British countryside must be grateful to the noble Lord, Lord Carter, for introducing this subject for debate today. Sadly, Her Majesty's Government, and their predecessors since 1979, while professing and declaring their belief in helping and maintaining the rural economy, have actually achieved exactly the opposite. With friends like this, those in rural areas certainly do not need enemies. In terms of numbers, we are very much an urban society these days, and therefore when there is discussion of social deprivation, poor housing and unemployment, it always seems to revolve around urban areas. However, there is now an ever greater need to highlight the problems in rural areas, much of them as a result, sadly, of Her Majesty's Government's policies.

Many noble Lords have already drawn attention to the disastrous results of the common agricultural policy, which has accelerated the decline in employment in farming. While some of the decline is due to greater efficiency, now we have the dreaded set-aside in action, taking good land out of use and leaving less work for farm workers. We used to be self sufficient in milk production, but thanks to obeying to the letter the EC imposed milk quotas—and can we believe that everyone else is following such a strict line as we do?—we now have formerly expanding businesses producing wonderful and individual farmhouse cheeses which are now not allowed to produce the milk to expand further. Agriculture this century has been a great success story. Is it not sad to see what is happening to it now?

The position with forestry is even worse. One would think that in a country that has to import 92 per cent. of its requirements of timber and timber products great incentives would be given to increase production, as we have in many ways ideal growing conditions for effective forestry. For many years, as has been mentioned by my noble friend Lord Radnor, we had a taxation regime that encouraged the planting and growing of trees. As many in your Lordships' House will remember, my father was at the forefront of those who advocated forestry in Great Britain. Indeed, he planted many hundreds of acres not with blankets of uniform conifers but with beautiful, mixed plantations—a prophet of correct ecological practices well before others.

Would he not be disappointed to see the outcome? Private landowners all over Britain are being forced to lay off their forestry workers because Her Majesty's Government reacted far too hastily to the fact that certain pop stars and BBC presenters were using the forestry taxation rules to convert taxable income into capital. Unfortunately, the ill thought-out changes in taxation penalised active, long-term family forestry operations, particularly in our case where we have little mature timber as a result of my father's active planting policy, and therefore a very low Schedule B income.

We have reacted in the only way that we could—as have many other private forestry owners—by making our staff redundant. What a dreadful consequence for them and for the British countryside! Surely the same end of preventing the use of forestry taxation reliefs for tax avoidance could have been achieved without jeopardising the future of family forestry businesses.

The recession has also had its effect on estate works departments, where the fact that outside builders, given their low workload, can give such keen quotations means that often estate departments are unable to compete. Taking our particular case as an example, Weston Park is now in the ownership of a private charitable foundation. Obviously, the trustees have to abide by charity rules, and the estate works department, which traditionally carried out all the work on the mansion house and buildings in the park, helpfully balancing out summer and winter work, now quite rightly has to compete with the prices quoted by outside contractors, and is unable to do so. Therefore, yet again we have had to cut back, and now have a much smaller team, which is disastrous for local employment, as we have had to make redundant many workers, some of whom had been on the estate for their working lifetime, and in many cases their fathers before them.

We also now have many redundant farm buildings, often most attractive and potentially useful structures, Which cannot be used for farming because they are unsuited to modern practices. As we are in a green-belt area, it is often difficult to obtain a practical change of use for those buildings, though I believe that some planning authorities are more enlightened about this than others. The overall effect of the present situation around us has been, and continues to be, a serious decline in rural employment and the local economy, with little apparent hope of any improvement; a situation that is repeated all over the country.

There is also a considerable cost penalty to living in the countryside. For instance, within one mile of our house, we have the largest gas pipeline in Britain; but we are unable to get a gas supply, which is the cheapest and most effective form of heating. It now costs a small fortune to be connected to the mains electricity supplies or mains water. If one happens to live in a remote area, try getting a telephone line connected at a sensible price if, apparently, it requires more than 100 man hours to install it.

Many noble Lords have touched on the necessity to own a car because local bus services appear to be in terminal decline. There are fewer small shops while the new and wonderful out-of-town supermarkets are not all that far out of town. Therefore they are available easily to those in the countryside only if they have transport. Old people find it hard to collect their pensions unless they have their own transport because the day when every village had its own post office has long gone. Village schools have all but vanished for very good and understandable reasons, but all that penalises country dwellers.

Sadly the idealised view of rural living is far removed from reality. We believe that as we are so few we are considered to be relatively unimportant in economic terms. We do not protest as the French do by blocking motorways and overturning fish markets. And if we did could we expect to receive the same lenient treatment from our authorities? In France no one seems to be arrested. Perhaps we should not be so silent and inactive. That appears to result from a sense of helplessness to do anything to improve our future as more government and EC policies destroy the economic and social position of rural areas.

4.41 p.m.

Lord Taylor of Gryfe

My Lords, I am particularly indebted to my noble friend Lord Carter for introducing the debate. Some of your Lordships may have noticed that for the past two years I have had on ballot for short debate the future of the forestry industry. The fact that I have not yet been successful in the ballot enables me today to say a few words about my favourite subject. I propose to take advantage of the debate so to do.

I am also indebted to the noble Earl, Lord Radnor, whose father was one of my predecessors as chairman of the Forestry Commission. I agree with his plea and that of the noble Earl, Lord Bradford, whose father was a most distinguished forester, that the tax regime should be re-examined. The net effect of the change in policy has meant no further money to the Exchequer and it is helping to destroy an industry.

The noble Earl, Lord Radnor, also said that the set-aside—that is, the land which is doing nothing and for which farmers are paid—should be considered more actively as a suitable area for substantial forestry development. As the noble Earl, Lord Bradford, said, this year our trade deficit will probably be about £11 billion. The import value of timber and timber products will probably amount to £8 billion, which makes a substantial impact on our balance of payments situation.

When the subject was considered on a previous occasion I was encouraged by government assurances about their commitment to forestry. Perhaps I may read from the annual report of the Forestry Commission which gives the forestry policy as stated by Ministers on 18th September 1991. I was encouraged by the aims stated in the report, which reads: Forests and woodlands are an integral part of the rural environment, providing important opportunities for recreation and for public access to the countryside. They are also a valued component of our landscapes and an essential habitat for wildlife. Our forestry industry makes a substantial and increasing contribution to meeting the growing national demand for timber… The two main aims of the Government's forestry policy are thus: The sustainable management of our existing woods and forests. A steady expansion of tree cover to increase the many, diverse benefits that forests provide". That is a statement of government policy. Indeed, the Government have reiterated the fact that their target is still 33,000 hectares.

In the light of that commitment, perhaps I may quote the figures. Some 20 years ago we in this country were planting 42,000 hectares per annum. That has dropped to approximately 15,000 hectares per annum. That is hardly consistent with the Government's commitment to an expanding forestry policy. In the uplands in particular forestry provides five or six times the number of opportunities for employment as compared with, for example, sheep farming. Yet despite the fact that employment in forestry can make a sizeable contribution to the issues which we are discussing today forestry is decreasing in employment terms. The Forestry Commission did a remarkable job in restoring some of our woodlands and in providing rural employment. However, it is now the victim of doctrinaire thinking on the part of the Government.

I know that the Minister rejects that view but the facts are there. During the past 10 years the Forestry Commission planting programme has been cut from 15,000 hectares to 3,000 hectares last year. The organisation is now concerned with administration rather than its original function of planting trees and increasing our tree cover. During the past five years the Forestry Commission has shed more than 2,000 employees. That is important in our rural economy because there are few opportunities for employment in some of the areas in which the Forestry Commission operates. Therefore, the Government cannot go around saying, "We believe in an expanding forestry policy", while at the same time allowing the industry to die. The industry is in crisis. We have encouraged large investors to come to this country on the assumption that timber supplies will be available for the new pulp and news print mills. However, that is not the case. A decline in the planting programme today will catch up with us in 20 or 30 years' time.

I beg the Government to look at their future policy. When I was chairman of the Forestry Commission there was a partnership in forestry in this country. There was no serious competition between the private and state sectors. We worked together. About 50 per cent. of our planting programme was private and the rest was state. It was a healthy relationship. We shared research, experience, pest control and good neighbourliness in the countryside. It was an excellent example of a mixed economy.

That no longer exists because the Forestry Commission is being steadily diminished. That would be all right if the private sector were taking up the slack. However, the tax regime is such that the private sector is no longer interested in substantial forestry investment. As a result there has been a contraction in a basic industry which uses up a renewable natural resource and the Government must look at that problem urgently.

This has been a friendly and non-party debate. I believe in partnership and consensus in dealing with those problems. However, the Government must get away from their doctrinaire attitude of diminishing the state sector when the private sector is unable to take up the slack.

4.50 p.m.

Lord Marlesford

My Lords, I too have an interest to declare as a member of the Rural Development Commission chaired by my noble friend Lord Shuttleworth.

There are two points that I should like to make. The first is to draw attention to an aspect of what I see is the imbalance between conservation and development in rural areas. The second is to make a specific proposal for, in the words of the most useful Motion in the name of the noble Lord, Lord Carter, coherent policies for the economic needs of rural areas.

For generations there have been battles between conservationists and developers. I yield to no one in my concern for conservation, having been for 12 years a member of the Countryside Commission. Nevertheless, I believe that we must face up to certain crucial points. First, there is a hierarchy of designated areas in the countryside. It is important to stick to designation and to recognise that those areas need to be especially cherished. However, even in those areas it is possible to have useful development. I recommend to those of your Lordships who do not already know them to visit the useful high tech developments which have taken place in the Peak District National Park.

Some areas have been forced to diversify. An obvious example is Durham. In 1951 there were 134 pits employing over 100,000 miners; now, I believe, there are only two pits employing fewer than 2,000 people. However, it is interesting as an example of the fact that pollution, which is so disliked by conservationists, does not come only from new industries but also from old industries. I was staggered to see that even today coal waste is being tipped directly into the sea at Seaham in Durham.

Agriculture has a part to play. My noble friend Lord Bradford was perhaps aiming at the wrong target when he complained about the Government. Perhaps he should have spoken about Brussels. I am an unashamed free trader. I believe that it is possible to be a free trader and a supporter of the European Community. I believe that set-aside is total nonsense and non-viable in the long run. Nevertheless, I salute my right honourable friend the Minister of Agriculture for having taken action in the negotiations which ensured that the set-aside nonsense is nothing like as pernicious and discriminatory against British agricultural production as Mr. MacSharry originally hoped that it would be.

Paradoxically, because macro interventions of the set-aside type usually get it wrong, there is now a useful extra injection of set-aside cash to the rural economy from the devaluation of the pound and also from large increases in the price of certain products. Feed wheat at £140 per tonne is rather helpful for those of us who grow it.

I believe that there is unbalanced emphasis on conservation in the planning process. There is a particular proposal which I should like to make to the Minister. We hear a great deal about environmental impact assessments as part of the planning process. I am not quite sure how—perhaps the Minister and his colleagues will give some thought to it —but an economic impact assessment should also be introduced into the planning process so that the economic impact of proposed developments in the countryside can be balanced alongside the environmental impact. They are both important. However, I believe that at present we have the balance slightly wrong.

Finally, I make one specific suggestion as to how we could give an immediate and cost-effective boost to jobs in rural areas. I am not a great believer in large-scale megaprojects. Very often, with road building and so on, the phasing is wrong in terms of the economic cycle. One should always be looking—and I should like to think that the Government are looking—for short-term action which is fairly certain to be effective. I have a modest proposal to make but I hope that the Government will consider it. Perhaps the Minister will discuss it with my right honourable friend the Chief Secretary.

English Heritage, with which I have no direct links, has a budget of about £100 million per year, of which some £17 million is spent on giving grants for the repair of individual historic buildings and monuments, both secular and churches. Of that about £10 million goes to churches. Currently the grants are about 40 per cent. They used to be up to 90 per cent. when the scheme first started.

In rural areas it is very difficult for small parishes with important churches to begin to afford the balance between 40 per cent. and 100 per cent. I therefore suggest that the Government should offer for 1993–94 an additional £5 million to be spent specifically on giving help to the repair of listed churches. I mean parish churches and not cathedrals because, on the whole, cathedrals find it much easier to raise funds for themselves.

Such a scheme would have several advantages. First, churches are widespread throughout rural areas. Secondly, the contractors who would do the work are almost exclusively British. Thirdly, the materials used for that work are almost entirely United Kingdom sourced. Fourthly, it would encourage greatly the craftsmen and craftswomen who can do that kind of work. Fifthly, it is an extremely good time to undertake such work because competition is very keen and the Government would receive extremely good value for money.

I recognise that proposals to spend extra money are never popular with the Treasury. Nevertheless, I hope that it will look at the advantages of spending that kind of money compared with some of the other vast expenditure which often provides less value for money. I suggest that the Government need to consider such schemes as a means of giving a stimulus in the short term to rural areas and particularly to small building companies. That may be relevant to the debate which is to follow. It could make all the difference between the survival and disappearance of such companies.

4.57 p.m.

Lord Geraint

My Lords, I am particularly grateful to the noble Lord, Lord Carter, for giving us the opportunity to discuss the problems of rural Britain. I am grateful too for his constructive and inspiring opening speech.

I thank all other noble Lords who have expressed anxiety about the plight of those who live in rural areas, and in particular my noble friend Lord Beaumont of Whitley for his emotional plea on behalf of the agricultural industry. I thank him for that.

I am a countryman born and bred and I have never wished to live anywhere else. However, I should be the first to say that country life on the whole is not the idyllic dream so often portrayed on the television or written about in glossy magazines. For those who live and work in the countryside, the reality is too often grinding poverty, compounded by poor housing, inadequate services, non-existent public transport and a chronic low wage economy which drives away youth and enterprise.

I do not wish to paint a picture of unrelieved gloom. Many survive happily in the country. They have worthwhile occupations and manage very well. However, I wish to press home the point that rural Britain has problems to equal those of urban Britain and that the case for coherent and comprehensive policies to tackle them is unanswerable.

Time is limited in this debate but I should like to mention some facts. Unemployment in rural areas is on the increase. In many areas the figures are above the national average. Some of the worst areas are South Yorkshire, Cornwall, Cleveland and the Isle of Wight. There is also the problem of a chronic shortage of affordable housing. In Wales we are very much aware of that and sympathise greatly with other areas where young local families have been forced to move away as a result of the influx of affluent second-home owners and the depletion of council housing stock. This problem, in my view, needs to be tackled urgently unless we want our villages to turn into picturesque but lifeless museums or just boring dormitories for city commuters.

Village shops are disappearing at a tremendous rate. Rural schools are closing and cottage hospitals are becoming a thing of the past. What is vital for the survival of rural life in Britain is, undoubtedly, the health of the agricultural industry. Although it is the largest industry in the country, it employs only 2 per cent. of the working population—in Cardiganshire where I farm, the percentage is much higher of course —but it underpins the whole rural economy. If agriculture is allowed to decline, the whole rural economy will decline along with it. I wish to make a plea to the Minister. I am sure he is aware that there is now a distinct possibility that the Agricultural Training Board Cymru will be abolished and decision making and funding for Wales will become the province of a single agricultural training board based at Stoneleigh in Warwickshire. If we want to keep our young people in Wales and if we want to train them, I beg the Minister to keep the Agricultural Training Board headquarters in Wales.

The Liberal Democrat approach to agricultural policy is to place it within the whole rural context and to develop policies with that concept in mind. In today's world I believe that that is more necessary than ever and I fear that the Government's somewhat piecemeal approach, leaving so much to market forces, can only fail us in the long run.

I wonder whether I might, as a Welshman, make one suggestion. We in mid-Wales have benefited a great deal from the setting up of the Development Board for Rural Wales, which has brought in light industry and helped small business as well as assisting social developments. I do not pretend that it has solved all our problems by any means. It does not have sufficient finance or power as yet. I should like to see its boundaries extended. However, within its limitations, it has done a good job. Might it not be a good idea to set up a similar development board for rural England to cover all rural counties which could co-ordinate policies and encourage renewal in the most hard-pressed areas?

Before I finish I should like to touch briefly on two other points. The first concerns crime in rural areas, which has grown tremendously over the past few years. This is not the time to discuss the reasons for that as the debate would go on for hours, but I think that police numbers should be increased to deal with the vast distances involved in rural areas and to give the population in those areas the confidence of the police presence.

Secondly, I am concerned about transport in rural Britain. I shall refer only to Wales as I am more familiar with our problems there. We have experienced the cut-backs and rationalisations forced on British Rail through lack of proper funding, but I become less and less confident about the future. We have learnt recently that British Rail is to lose freight business because Shell has decided to transfer its oil transport from rail to road when supplying its Aberystwyth depot. Not only will this mean more large lorries on heavily used tourist routes, but it will also undermine the viability of the Birmingham to Aberystwyth route and cast another shadow over its future. I am told that the decision has been taken for commercial reasons. That does not fill us with confidence over the prospect of the privatisation of British Rail. Commercial considerations could well kill a number of the less profitable but socially useful routes in Wales and other parts of rural Britain. To lose the Shrewsbury to Aberystwyth line or the Heart of Wales line, for example, would be yet another blow to the rural economy. We need those routes for our tourist industry and to link our small communities. They must not be allowed to close.

5.4 p.m.

Lord Gallacher

My Lords, this has been not merely an interesting debate but a very comprehensive debate. In spite of the fact that it was time limited, the variety of subjects covered in the two and a half hours allocated to it has, in my opinion, been quite remarkable, as has the quality of the speeches, due no doubt in large measure to the experience of the people who took part in the debate.

The reform of the common agricultural policy, while not at the heart of this question, is certainly now a major factor concerning it. There will inevitably be reductions in farming effort as a consequence, and included in that will be some continuation of the inevitable reduction in the number of people employed on the land. Thus we have an accentuation of a policy which is already of considerable concern.

In rural areas any reduction in farming effort and in the intensity of farming means a contraction in economic activity overall and that of course, in turn, produces social effects because there will be a spin-off in ancillary trades and some reduction in the willingness of other people to come in with new development. Rural unemployment is thus increasing and I am sorry to say that investment in the countryside may be in danger of decreasing.

The role of planning machinery in all this is of vital importance. I am glad that this point has been emphasised by a number of speakers this afternoon. Change of use and new development are vital if some of the difficulties which rural areas are experiencing are to be reduced. In this area there is a new element, the reform of local government, which, although it will be a slow process in England because of the method chosen by the Government, has already produced specific proposals for Wales for single tier authorities.

I do not wish to advocate any particular form of local government for England, but the fact of the matter is that the attitude of the planning authorities to developments in rural areas is of vital importance both now and in the future. So, too, is training. The future of the Agricultural Training Board was raised by the noble Lord, Lord Geraint, and in particular the question of the funding of that board. It has had a useful existence, funded as it is by the Ministry of Agriculture. If there were to be, as a result of the review, any major reduction in funding for the Agricultural Training Board, that would be a serious matter for the rural areas, particularly at a time when more training and retraining of an agricultural character is still essential.

Rural public transport has been mentioned by more than one speaker and in particular by my noble friend Lord Underhill, and with it the impact upon the Post Office bus if proposals for the privatisation of the Royal Mail are proceeded with. There has been, under pressure from central Government, some reduction in county council funding of rural transport. The loss of the Post Office bus—if that were to be an outcome of the privatisation of the Royal Mail—which was pioneered in Scotland would be serious for all communities, as has already been pointed out.

The effect of Sunday trading on the village shop cannot be ignored. I served as an assessor to the Auld Committee which considered the Shops Act 1950 in some detail. I was particularly struck at that time by the evidence of the Ministry of Agriculture, Fisheries and Food to the Auld Committee which drew serious attention to the likely impact on small food shops everywhere if there were no restrictions of any kind on Sunday trading, particularly as regards the large supermarkets. Inasmuch as the Government have reactivated this question, we must look very carefully at the three options which the Minister mentioned the other day in another place. We must take care to look hard at his own point of view; namely, that no restrictions whatever would be the best solution. I do not believe that the impact of that solution across the board can be ignored, and certainly not in rural areas. While affordable housing in rural areas may not be the most important subject, it is certainly a basic subject so far as concerns the rural communities.

Some 30 years ago I served the International Co-operative Alliance movement. At that time I was almost embarrassed by the fact that the housing co-operatives in many countries in Western Europe and in the United States, upon which our present British housing associations are largely based, were full of admiration for the municipal housing which was then going full steam ahead in Britain. Those foreign housing associations were impressed by the speed with which local authorities could acquire land for housing, the ease with which planning consents were granted, the funding of such development by central government, the avoidance of fragmentation in development so that in the main the developing authorities were sizeable bodies, and the continuity of policy. In those days those factors radically impeded housing associations in Western Europe and North America.

Affordable housing is geared to land costs, interest rates and rent subsidies. Perhaps the Minister will answer this question when he replies to the debate. Are Her Majesty's Government totally committed to excluding local authorities from housing development of any kind in rural areas? We are grateful that the noble Lord, Lord Shuttleworth, was able to report briefly but effectively on the work of the Rural Development Commission. Its work is impressive and we strongly support it. That body performs an essential task in England. One hopes that parallel organisations exist in Scotland, Wales and Northern Ireland. The work that the RDC undertakes is no less essential beyond the boundaries of England.

The Rural Development Commission's present lines of development are directed at the main problem areas, although saturation points may have been reached with wrought iron gates and craft shops. New enterprises are essential in the country because, as well as creating a favourable climate, the Rural Development Commission has pursued an active policy in promoting them. One would wish to see some liaison in training courses between the RDC and the Agricultural Training Board. We welcome the initiative of the commission on village halls, subject to the condition about their having charitable status and certain other factors.

From these Benches we wish to encourage the Rural Development Commission to consider prospects for village community co-operatives, perhaps to run the shop, the pub, local transport, halls, the Post Office and other relevant activities. There now exists a body in Britain called the United Kingdom Co-operative Council. It is fairly new and it has had the good sense, on changing its chairmanship recently, to invite my noble friend Lord Carter to take on that additional task. The important factor about the UKCC is that for the first time we have in Britain an organisation which represents the whole co-operative activity. Therefore an experiment between the RDC and the UKCC in developing a suitable rural village co-operative is worth consideration. Expertise is now on tap covering banking, insurance, supplies, retailing, credit, leasing, mortgages and farming. We welcome the emphasis which is now placed on rural areas by the Government and in particular by the Minister of State for the Environment and Countryside. I believe that his apprenticeship training in MAFF stands him in good stead and we are not too disappointed by the noises that he makes about the way in which he considers the future should be developed.

I do not pretend that rural areas are more deprived than urban areas. Deprivation in the rural areas undoubtedly exists, as many speakers have pointed out, even though it is of the genteel variety. Problems exist and will grow in a recessionary situation. Policies are certainly important; and that is the purpose of the Motion that we have put down today. A positive response is required, plus, as we see it, continuity of assistance.

5.15 p.m.

Lord Strathclyde

My Lords, like all noble Lords I welcome the opportunity to have a debate about our rural areas. The debate began extremely well with the speech of the noble Lord, Lord Carter. He quoted the Prime Minister and Jacques Delors. We later had a quotation from Jean Jacques Rousseau. I thought that we might have had a debate made up of quotations, but regrettably they came to an end.

It is an important debate because it draws attention to the need for comprehensive and coherent policies for the economic and social development of rural areas. I am pleased to have the opportunity to explain to your Lordships how the Government have developed a strategy to meet the needs of the countryside, today and in the future.

The countryside is the result of continuing changes, from the Ice Age to the enclosures, the industrial revolution and our present age of modern technology. It is continuing to change fast, as the economy adapts to changes in agriculture and other industries in the countryside.

In his opening speech, the noble Lord, Lord Carter, recognised that the rural economy is no longer based exclusively or even predominantly on farming, forestry and local raw materials. Agriculture, forestry and fishing now produce less than 2 per cent. of the gross domestic product of the United Kingdom. In the past 30 years the number of people engaged in agriculture has fallen by 39 per cent. In the Rural Development Commission's priority areas, the rural development areas, agriculture accounts for only 9 per cent. of waged employment. We have a responsibility to address the implications of this decline in agriculture—for farmers and other country dwellers and for the landscape and wildlife habitats.

There are still areas where jobs are short, but in general the rural economy is extremely diverse. The service sector, manufacturing, distribution and catering industries are now the main sources of employment in the rural development areas. Indeed, some rural areas have an employment structure which is akin to that of successful urban areas. However, success has brought with it a range of new problems, such as the availability of affordable housing for people on lower incomes.

In future we shall see further changes and we shall need to keep their implications under review. There will be further changes in agriculture as CAP reform takes effect, and changes reflecting improvements in communications technology. Farmers will continue to use large tracts of our countryside. They currently farm some 73 per cent. of the land surface of England. But as worries about food shortages are replaced by worries about over production, as the noble Lord, Lord Beaumont of Whitley, said we should more and more look to farmers to manage our countryside in environmentally sensitive ways—by managing hedgerows, by planting broadleaved British trees and through less intensive farming methods.

The Government's role is to ensure that there is a coherent comprehensive and up-to-date package of policies in place to maintain a thriving countryside. We need to achieve this through a sensible balance between the development of the rural economy and the protection of the countryside. Our two key objectives are to achieve a healthy rural economy and an attractive rural environment. That was well explained by my noble friend Lord Shuttleworth, and by my noble friend Lord Wade of Chorlton, who brings to the debate his unique and wide experience.

Our aim is the promotion of a diverse, healthy rural economy through the stimulation of employment and development in the countryside, while at the same time making sure that there are adequate measures to maintain and enhance our landscapes and wildlife.

Those are our objectives. They set a difficult balancing act. It would be rash to claim that we have in all cases and at all times struck exactly the right balance. But we are facing up to the challenge. Our 1990 White Paper, This Common Inheritance, laid down principles which we apply to all our environmental policies throughout the United Kingdom. We reaffirmed those policies, and added fresh initiatives, in the first and second year reports.

Last year we published Action for the Countryside, a major policy document setting out a clear, comprehensive and co-ordinated package of policies for the countryside in England. It includes a £45 million package of new, improved and extended initiatives to promote rural development, to conserve and enhance landscapes and wildlife and to promote access to and public appreciation of the countryside. Scotland, Wales and Northern Ireland have also published statements on their rural policies during 1991 and 1992.

These departments work closely with others to ensure that there are comprehensive and coherent policies providing a framework for the economic and social development of rural areas. But their main task is to guide and encourage others. We want to encourage the enterprise of all those who live and work in rural communities and to see increasing activity by the private and voluntary sectors. We are anxious to see that the best possible use is made of limited public funds, by making full use of opportunities to influence others and by concentrating activities in areas with the greatest need. But we do not hesitate to take direct action where necessary. A key example of that is the advice which we have issued on planning policy in England and Wales. That was recognised by many noble Lords who spoke during the course of the debate.

Planning Policy Guidance Note 7, which was issued by my department and the Welsh Office last year, recognises the substantial changes that are taking place in the countryside and incorporates the principles set out in This Common Inheritance. It makes clear that it is important to sustain the process of diversification and to accommodate change, while continuing to conserve the full and varied countryside. Rural areas have to change if they are to survive. Indeed, a vibrant rural economy—rural homes and rural jobs, changing with the times—is an essential precondition for the protection and enhancement of the countryside. PPG7 recognises that rural areas can accommodate sensitive development without detriment. It gives advice to local authorities on the need to encourage rural enterprise and balance it with the need to safeguard open countryside and protect special areas like national parks.

PPG7 has been widely welcomed, as my noble friend Lord Wade said. That was the near universal reaction at the national conference we held last summer. In the year since PPG7 was issued we have put a lot of effort into getting its message across, at the national conference and a series of regional seminars, and for example in a popular guide for farmers seeking planning permission for diversification ventures or new agricultural developments. We are monitoring development plans to ensure that PPG7 policies are appropriately reflected and taken into account in planning appeals. Research on some key changes introduced by the PPG is under way. We believe that its balanced approach to rural development and conservation is the right one, and we are continuing to ensure that it is appropriately implemented.

My noble friend Lord Radnor asked whether we should do more to publicise it. If we have failed, then of course we must do more. My noble friend Lord Marlesford asked whether we should include some assessment of the economic impact rather than just the environmental impact. That is something that I shall have to take away with me and think about.

The noble Lord, Lord Carter, and others, mentioned the major problem of rural housing. On rural housing, we have been taking steps to ensure that there is an integrated package of policies. We accept that it is important for affordable housing to be available for those who live and work in rural areas. We recognise that there are particular difficulties in some rural areas, especially where house prices have been driven upwards by demand from long-distance commuters and well-off retired people.

On the other hand, we cannot simply resist those market pressures. After all, they represent genuine demands from many people who wish to live in attractive rural surroundings. The survival of rural communities depends on successfully adapting to change. In July 1988, the Secretary of State for the Environment announced his rural housing initiative which, for the first time, set out a policy on low-cost housing in the rural areas in England. Since then, we have introduced a series of measures designed to boost the supply of low-cost housing in rural England. Likewise, the noble Lord, Lord Stallard, mentioned that point. We are increasing the level of investment in rural areas through housing associations which have a major role to play in providing affordable housing for rent and low-cost sale.

To help ensure that our policies for rural communities are carried forward in a co-ordinated and coherent way, the Government also sponsor specialist agencies. In England, the Rural Development Commission, which is sponsored by my department, is the Government's main agency for diversifying rural enterprise. In Wales, similar tasks are undertaken primarily by the Development Board for Rural Wales and the Welsh Development Agency. In Scotland the main agencies are Scottish Enterprise, Highlands and Islands Enterprise and the local enterprise companies. In Northern Ireland, the Government have established the Rural Development Council, an independent body funded by the Department of Agriculture with assistance from the European Commission.

The agencies have a star-studded list of achievements to their credit. In 1992–93 Highlands and Islands Enterprise is expected to have created or retained 2,700 jobs. Since 1979, the Development Board for Rural Wales has built some 630 new factory units providing about 7,300 job opportunities. In England the Rural Development Commission's workspace programme created the potential for 2,287 jobs in 1991–92. Those are records of which we are proud and I am particularly grateful that my noble friend Lord Shuttleworth, who is chairman of the RDC, joined the discussions today.

Both the noble Lord, Lord Carter, and my noble friend Lord Shuttleworth discussed the problems with rural services. Where particular rural service problems arise they are generally tackled by the organisation or agency concerned. The Rural Development Commission also keeps a watching brief on developments in rural services on behalf of my department, the Department of the Environment, and makes representations where it is appropriate. I hope that the noble Lord, Lord Underhill, will be interested to know that, for example, the Rural Transport Development Plan, administered by the Rural Development Commission, with funds from the Department of Transport, is there to assist with capital start-up costs of new, innovative rural bus services in England. Similar schemes exist and are run by the Scottish and Welsh Offices.

The Rural Development Commission is also taking an increasing interest in village shops. In March 1992, it initiated three demonstration projects to explore ways in which village shops can be helped by financial management and community support. A report on the findings of those projects is currently being prepared. In addition, the RDC offers advice and training to shopkeepers through its business advisory services and has held seminars for prospective shopkeepers.

So to schools. The noble Baroness, Lady David, enunciated the plight of village schools most clearly. As a government we recognise that many small schools do an excellent job. We also recognise that many have to be retained because of the geographical isolation of the communities they serve, especially where the alternative schools available would necessitate unacceptably long journeys to schools for young children. The Government have made it clear that assessing the viability of small schools is not only a matter of the numbers on the roll. Wider considerations such as parental choice, local geography, the distances to be travelled to alternative schools and the age of children making these journeys are also very important.

Our policies for promoting improvements in the education service—through grants for education support and training, through the local management of schools and the implementation of the national curriculum—have all taken account of the needs of small rural schools. The Government hope that many small schools will be able to benefit from the proposals contained in the Education Bill, currently before Parliament, to allow them to apply for grant-maintained status in clusters. This will put the many benefits of grant-maintained status within the reach of schools that might otherwise lack the confidence to go it alone. Forming a cluster will be entirely voluntary and there is no question of schools being forced into clusters. Such schools will continue to be able to apply for individual grant-maintained status. We believe that grant-maintained status is best for all state schools and this is just as true for small rural schools.

I turn to the question of forestry which was raised so eloquently by my noble friends Lord Radnor and Lord Bradford and the noble Lord, Lord Taylor of Gryfe. The noble Lord, Lord Taylor, said it was his hobby-horse. He has been interested in forestry over the whole of the United Kingdom since his time as chairman of the Forestry Commission—and a most eminent chairman he was.

The Government's long-term forestry strategy sets out two aims; first, the sustainable management of existing woods and forests and, secondly, a steady expansion of tree cover to increase the diverse benefits that forest provides, social and environmental as well as economic.

One point stood out in the speeches of the three noble Lords who mentioned forestry. It was their belief that forestry was for the long-term. Therefore, I think it wrong to criticise the Government for action taken in the short term. If we are honest, a small two-year or three-year gap and a fall-off in the amount of planting that has taken place will be irrelevant in 40 to 50 years' time when the trees reach maturity.

Lord Taylor of Gryfe

My Lords, the figures I quoted showed a trend over 20 years of a substantial and steady decline. Over how many years is the Minister prepared to judge that policy?

Lord Strathclyde

I look forward to the time when his debate will be chosen from the ballot and we can go into those problems far more fully. I intended to say that I accept the points made by the noble Lords who mentioned forestry. In the last election the Government had a clear manifesto commitment. We said at that time that we would review the effectiveness of the current incentives for forestry investment. I can tell the House that the Government hope to complete their review this year.

I turn to the point made by the noble Lord, Lord Geraint, on rural railways. I believe that we are being unduly pessimistic about the future for the railways, particularly with regard to the rural lines. The Government want to see more people travelling by train, not fewer. We also want to see the railways run efficiently. Our policy to achieve that is to privatise the railways and harness the skills of the private sector to run services; not just because we believe that private sector operators would be more efficient but because that should bring about a sharper focus on passengers and will ultimately lead to better, more reliable and more attractive services.

Nevertheless, we have given a clear commitment to continue to provide subsidy where necessary to support services which, although loss making, provide a valuable social service. There is no question of loss making services being regarded in any way as second best. Rather, the Government's franchising proposals are based on a desire to bring the benefits of a private sector operation to all passenger services, not just to those that can make a profit. There is therefore no reason why privatisation and the introduction of franchising should result in closures.

As the need arises, new policies and initiatives are introduced. For example, last year the Rural Development Commission launched its countryside employment programme to help diversify the economy and improve job prospects in areas which are suffering from structural changes in agriculture. The commission will deploy the full range of its programmes in the pilot areas and will co-ordinate these with the services available from other partners. Local businesses, land owning and environmental interests are also associated with the project.

My noble friend Lord Vinson referred to burdens impairing the success of small businesses, many of which operate in rural areas. I entirely sympathise with his concern. As my noble friend will know, we recently launched a drive to free businesses from the burden of unnecessary and over-bureaucratic regulation. I can assure noble Lords that that initiative is being pursued with vigour.

Perhaps I may respond to my noble friend Lord Bradford, who made a powerful speech on the problems of the common agricultural policy and on our whole policy towards rural affairs over the course of the past 13 years. I felt that that was overstated. As my noble friend Lord Marlesford so wisely said, my noble friend Lord Bradford should look in the direction of the European Community. Set-aside has been caused by the problems of success. Surely in the short term it is far better to have set-aside than to have no source of income for our farmers throughout the country and in the rest of Europe.

Only through having a thriving, vibrant countryside can we ensure that our countryside, and our people, are well cared for. We can provide the policy framework and assistance where necessary, but the economic and social development of the countryside is not something which is solely for government. We are in the business of managing a vibrant and evolving countryside coping with today's needs. The key to that lies in the people of this country—not only those who live and work in the countryside, but those who enjoy it in their spare time. The future depends on the actions of all of us.

5.35 p.m.

Lord Carter

My Lords, we have had an excellent debate. I should like to thank everybody who has taken part in debating a subject which this House can cover with both experience and expertise. It was certainly wide-ranging. By my count no fewer than 24 different topics were covered by the 15 speakers in the debate. The very range of topics mentioned indicates exactly the need for the comprehensive and coherent policies which are called for in the Motion. I should like to repeat my thanks to all who have taken part, and to the Minister for his very interesting reply. I hope he will not mind if I say that I was not completely convinced by the answer that he gave on rural housing, but I am sure that we shall return many times to that subject. My Lords, I beg leave to withdraw the Motion for Papers.

Motion for Papers, by leave, withdrawn.