§ Mr. Couchman
asked the Minister of Agriculture. Fisheries and Food if he is now able to announce the results of his discussions with the agriculture industry about the scope for raising revenue for services provided to it by Government as a contribution to the planned public expenditure cuts, indicating, in particular, the extent to which his proposals will be implemented in the legislation foreshadowed in the Gracious Speech.7W
§ Mr. Jopling
On 24 May at column582 I outlined my approach to industry funding of advisory and statutory work and research and development. Consultations have confirmed that, as far as the funding of relevant research and development is concerned, a system of sectoral contributions is the right way forward, and provisions to assist this are included in the Agriculture Bill presented today. My further statement of 23 July at column 448 initiated discussions with the industry about the overall scope for raising revenue for advisory and statutory work as a contribution to reducing the net cost of such work by about £16½ million in the financial year 1987–88. I indicated that I would be looking for contributions from three sources—income from charging for advisory work, income from charging for statutory work and economies in the operation of ADAS.
In the light of those discussions, I and my right hon. Friend the Secretary of State for Wales have now concluded that, in 1987–88, we can look for a contribution of at least £5 million from charging for ADAS advisory and promotional work. Under the power proposed in clause 1 of the Agriculture Bill, presented today, we plan to make charges for advisory services hitherto provided free of charge to individuals and organisations and to groups of farmers acting in association. Some new charges, notably for the kind of work presently carried out under the agricultural services scheme, will be introduced shortly after the passage of the Bill; other charging schemes will be initiated during the second half of 1986–87. Meanwhile discussions will continue with interested parties on systems and levels of charging. ADAS will also be using existing opportunities, including the agricultual services scheme, to assess market responses to the introduction of new services and to modest price adjustments. It is hoped to make further announcements on this shortly. We do not however have any plans to introduce charges for the kind of advice now provided to farmers free of charge on conservation, rural diversification or animal welfare.
Turning to charges for other services, a range of possibilities was considered in discussions with interested organisations over the summer. In the light of the views expressed, we have decided against introducing charges for tuberculosis and brucellosis testing work and for enforcement of horticultural marketing standards. So far as plant health is concerned, charges will be introduced only in respect of export and import licensing and certification. We shall also be introducing, or increasing, charges to recover the cost of the following services provided by our Departments: inspections under the milk and dairy regulations, the new approval system for pesticides, licences and approvals for artificial insemination, the licensing of swill feeders, the poultry health scheme, the pig health scheme, the enzootic bovine leucosis attested herd scheme, the maedi-visna accredited flock scheme and the enforcement of seed regulations. We also intend to increase charges for plant breeders' rights and the national listing of varieties. In most cases the new charges will take effect in April 1987. We expect them to yield about £6 million net in 1987–88. In most cases, no 8W new statutory powers to introduce charges are needed; but the new plant health and increased seed certification charges require new statutory powers which are sought in clauses 2 and 3 of the Agriculture Bill. There will be further discussions with interested parties on the arrangements for implementing the new charges and on our intention to introduce charges for the non-statutory advice given to local authorities in respect of agricultural development cases.
These measures will have an impact on the work and organisation of ADAS, as envisaged in the report prepared for me by its Director General which was published in November 1984. We believe that there is likely to be a strong, continuing demand once charges have been introduced for the expert independent advice provided by ADAS. The future of the service is not in doubt and we intend that it should be adequately staffed to earn the revenue that it is capable of bringing in. At the same time, there is scope for economies and improvements in efficiency, and these must be made if ADAS is to fulfil its changing role. ADAS currently has some 4,800 staff. Initial work on activities other than R & D, where savings were announced on 11 October, has shown there is scope for economies and, given follow up work to identify savings in other areas, we expect by the spring of 1987 to be able to reduce the size of ADAS by about 380 more posts along with appropriate savings in non-ADAS support staff. The final figure will in part depend on a closer assessment of the likely effect on uptake of charging for certain demand elastic schemes. Further details will be announced as soon as possible.
In financial terms, staff and related overhead savings of the order indicated above should, along with the expected additional revenue for charging, reduce the net cost of ADAS in the financial year 1987–88 by £16½ million.