ADAS: Privatisation (Hansard, 19 November 1996)

Lord Lucas
My Lords, after privatisation ADAS will be free to develop and improve its services to all its customers in response to market demand.

§ Lord Mackie of Benshie
My Lords, I hope that that does not mean that ADAS is not free to develop and improve its services at the present time. Is the Minister aware that there is great disquiet in the public about many farming practices? For example, there is enormous disquiet and consequent harm to the industry in relation to BSE. If the Agricultural Development Advisory Service is privatised there will be strong suspicion, especially bearing in mind the money the Government are asking for it, that it will go into the hands of chemical and other companies. They are not necessarily doing bad work—in fact they do good work—but the public need reassurance about many of the practices in farming which in themselves are excellent. That privatisation will cause immense disquiet.

Lord Lucas
My Lords, I am truly astonished by what the noble Lord says. Many times have I listened to complaints from these Benches relating to the non-independence of MAFF; about how functions and decisions should be removed from MAFF so that the public can have more confidence in them. The noble Lord is now complaining because something is being removed from MAFF, saying that the public will not have confidence in it. The noble Lord should be more consistent.

§ Baroness Nicol
My Lords, is it not the case that when ADAS started charging for its services a few years ago there was considerable anxiety about whether farmers would continue to use the services to the same extent? Can the Minister say whether there has been any reduction in the use of ADAS since charges were introduced? If so, is it not likely that if it is privatised that trend will continue?

Lord Lucas
My Lords, farmers are sensible, commercial people and will pay money for services that they find worth while. Many farmers find the services provided by ADAS to be excellent.

§ Baroness Nicol
My Lords, my question was whether there had been a reduction in the number of people using the service.

Lord Lucas
My Lords, I do not have the figures with me. I will write to the noble Baroness.

§ Lord Carter
My Lords, I should declare an interest in this Question as the President of the British Institute of Agricultural Consultants. Is the Minister aware that the original intention was to require ADAS to achieve 100 per cent. full cost recovery by 1st April 1997 and to offer it for sale during the summer of 1997? The target date was then brought back to 1st April and it is now to be rushed through early in the new year. What is the hurry? Does it relate to the second Starred Question about the future of Whitehall? Is this part of the Government's scorched earth policy to sell off or lease out every public asset they can before the general election?

Lord Lucas
My Lords, the procedure is going extremely well and running ahead of schedule. I see nothing wrong with that. Frankly, Pavlov must be pleased that the noble Lord was not one of his dogs. Year after year we have rung the bell for a new privatisation; year after year it has brought home the goods; and here again, faced with a new privatisation, is the noble Lord celebrating? No; he is dry-mouthed. Pavlov would not understand it and nor do I.

§ Lord Carter
My Lords, I find that to be an extremely insulting answer. Will the Minister answer my question? I did not ask about the merits of the sale; I asked about the timetable.

Lord Lucas
My Lords, I had hoped I had answered that in my initial sentence; that is to say, procedure and ADAS are running so well that the procedure is running ahead of schedule.

§ The Duke of Buccleuch and Queensberry
My Lords, does my noble friend agree that an organisation such as ADAS is only as good as the quality of its internal leadership and key personnel? Can the noble Earl give any indication that many of the excellent individuals in ADAS are willing to transfer to the new system? That would be a great comfort to many people in the agricultural industry.

Lord Lucas
My Lords, I can certainly give that assurance. The management and consultants of ADAS are very much in favour of privatisation.

§ Lord Richard
My Lords, I rise not to ask the noble Earl a question but merely to put a point forward that he might wish to consider. In the answer he gave to my noble friend Lord Carter, with great respect to him he went a bit too far. He went over the top. In my limited experience in this House it is not in accordance with the traditions of this House to launch such a personal attack, even if clothed in a mocking tone of voice. He would do well to consider apologising to my noble friend.

Lord Lucas
My Lords, if the noble friend of the noble Lord, Lord Richard, has taken what I said in that spirit, of course I apologise unreservedly. I was merely expressing myself in what I hoped was a bit 1199 of fun and if I misjudged it I am sorry. I am grateful to the noble Lord for pointing that out and for promoting me to an Earldom, which I do not deserve.

§ Lord Mackie of Benshie
My Lords, is the noble Lord aware that his answer was neither funny nor satisfactory? In fact, inside ADAS there is considerable dissatisfaction and fear of the change. Furthermore, the amount of advice given to farmers has gone down. Perhaps the noble Lord did not know that but suspected it.

Lord Lucas
My Lords, fears have been expressed before many privatisations. I remember the anxieties over rail privatisation. If one asked anybody who comes from my part of the world near Winchester what they thought of rail privatisation now, they would say it is the best thing that has happened to the railways that they can remember. When ADAS is privatised, I am sure that farmers will feel similarly about that privatisation.

§ The Countess of Mar
My Lords, the noble Lord, Lord Mackie of Benshie, expressed concern about the possibility that an organisation like a chemical company may take over ADAS. When the Government are tendering for people to buy ADAS, will they be prepared to consider management buy-outs as well as offers from other companies?

Lord Lucas
My Lords, very much so. The noble Baroness is quite right; a management buy-out would be an excellent idea. Indeed, the management informed us at an earlier stage that it would be interested in mounting a management buy-out.
As we have a minute left, perhaps I may say what are the principal objectives that we have set ourselves. First, we want to transfer the functions of ADAS and associated risk to the private sector on the best available terms; that is, terms which optimise the risk-adjusted net benefit. Secondly, we want to ensure that services provided to MAFF and the Welsh Office from the private sector can be delivered continuously, economically, efficiently and effectively. Thirdly, we wish to provide a clean break from the Government and minimise contingent liabilities. With that set of criteria, a takeover of ADAS by a chemical company which would threaten the future of its independent research is likely to be heavily discounted.

§ Lord Clark of Kempston
My Lords, does my noble friend agree that every act of privatisation by this Government has proved to be successful? Alas, the Opposition Benches have always been opposed to privatisation, which has increased the economic viability of this country.

Lord Lucas
Yes, my Lords.