AGRICULTURAL LAND: ALTERNATIVE USES (Hansard, 10 February 1987)

§ The Minister of State, Ministry of Agriculture, Fisheries and Food (Lord Belstead)

With the European Community now producing surpluses in many of the main agricultural commodities, a new balance of policies has to be struck, with less support for expanding production; more attention to the demands of the market; more encouragement for alternative uses of land; more response to the claims of the environment; and more diversity on farms and in the rural economy.

The Government are therefore taking a number of new policy initiatives to assist the process of change. A scheme will be introduced to encourage the development of farm woodlands to take land out of agricultural production. This will build on the existing forestry grant schemes, but also provide for annual payments to cover the gap between planting and the likely first income from most types of timber. The 638WA payments will vary by area in recognition of the fact that the agricultural income forgone from planting trees on farms will be higher in some areas than in others, but the maximum rate of aid will be £125 a year per hectare. The aim is to plant up to 36,000 hectares over the first three years of the scheme, at the end of which the scheme will be reviewed. The detailed arrangements will be the subject of consultation with interested parties prior to the introduction of appropriate legislation, but the scheme will incorporate provisions for the protection and enhancement of the environment, including special encouragement for broadleaved trees.

The Government also propose an expansion of the forestry programme, with particular emphasis on the private sector and with due regard to environmental considerations. The planting of a higher proportion of trees on low ground of better quality than hitherto will be encouraged by the release to forestry of better quality land; the Forestry Commission will keep in mind the need to encourage planting on this land in their regular reviews of grant rates. We shall continue to encourage broadleaved planting by higher rates of grant, as now. The aim is new planting of 33,000 hectares a year, compared with a current planting target of 30,000 hectares.

The designation of Environmentally Sensitive Areas under Section 18 of the Agriculture Act 1986, the first of which are due to come into force next month, will be extended early in 1988. In doing this the Government will build on the lists proposed by the Countryside Commissions, the Nature Conservancy Council and their equivalent in Northern Ireland. There will be consultations on the detailed arrangements.

Diversification of enterprise on farms will he encouraged by the introduction of a scheme under Section 22 of the Agriculture Act 1986, providing for the grant-aiding of ancillary businesses on or adjacent to farms. This will include activities such as value-added food processing and the provision of recreational and amenity facilities. There will also be extra help for marketing of the products of diversified businesses. In working up these schemes it will be necessary to ensure that they are complementary to the activities of the existing agencies working in this field, particularly the Development Commission, CoSIRA, the Small Firms Service, local enterprise agencies and tourist boards.

Within the Ministry of Agriculture, Fisheries and Food's budget for research, development and advice, my right honourable friend the Minister will be placing more emphasis on the possibilities for novel crops and livestock which have a prospect of being realistic alternatives to commodities in surplus, and on the socio-economic and environmental implications of the changing farming scene.

Finally, my right honourable friends the Secretaries of State for the Environment and Wales are, today putting out for consultation a draft circular containing guidance on the future planning regime for agricultural land. It will include more encouragement to local authorities to take a positive attitude to diversification and to be helpful about the conversion of redundant farm buildings.

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These new initiatives are expected to cost about £25 million a year when they are fully operational. This comprises an estimated £10 million on farm woodlands, £3 million on traditional forestry, £7 million on ESAs—doubling the existing provision—and £5 million on diversification and marketing. The alternative use of land will lead to savings on CAP expenditure. This does not imply any change in the overall public expenditure totals.

In addition my right honourable friends the Minister and the Secretaries of State for Scotland, Wales and Northern Ireland plan to publish next month a document setting out how the Government see the changes affecting farmers, emphasising that it is for individual farmers to decide how to run their own businesses, but describing how the Government's policies towards farming are being adjusted to reflect the changing scene and potential in the rural economy as a whole. The Government's overall objective is to facilitate the conditions which encourage a healthy rural economy based on enterprise, adaptability and fair competition.