§ Mr. Nicholas Winterton
asked the Minister of Agriculture, Fisheries and Food by how much farm borrowings have increased in the past year.
§ Mr. Peter Walker
The average level of hank advances outstanding to United Kingdom agriculture increased in 1982 by £618 million or 18 per cent. compared with 1981. In addition, outstanding loans by the Agricultural Mortgage Corporation and similar bodies, together with estimated instalment credit, increased between the two years by £30 million or 5 per cent., giving an increase of 17 per cent. in borrowings from these sources taken together. The continuing increase in bank advances, though at a slower percentage rate than in recent years, reflects, first, the recovery in the industry's new investment in fixed assets, secondly, the growth in its working capital requirements, and thirdly, the increased share supplied by the banks of the total credit needs of agriculture. The banks have recently increased their long-term lending and mortgage lending to agriculture. But the statistics of farm borrowings have to be kept in perspective. Survey results have shown that the industry's external liabilities bear the same relationship to the value of its total assets now as they did in the mid-1970s.