§ Mr. BoswellTo ask the Minister of Agriculture, Fisheries and Food when, further to his reply of 5 December, column30, to the hon. Member for Daventry, he plans to publish data on the state of the agriculture industry in the United Kingdom.
Mr. MacGregor: "Agriculture in the United Kingdom: 1988" has been published today by Her Majesty's Stationery Office. I have made copies available in the Library of the House. As indicated in my earlier reply, this document is the successor to the annual review White Papers which have been published in previous years. The new publication contains enhanced information on commodities and on the general financial situation of the industry and provides a compendium of statistics, generally continuing the series which has been running for many years, and providing valuable data for all those with an interest in the industry.
The document notes that 1988 was a year in which major policy developments took place in the United Kingdom and in the European Community generally. In the EC, the most significant development was the agreement reached at the European Council in February 1988, introducing budgetary discipline in the common agricultural policy and improving its management. Last year also saw the introduction of a number of United Kingdom schemes offering farmers the opportunity to
62Wengage in commercially viable alternatives to surplus production. Set-aside, the farm woodland and farm diversification grant schemes were all introduced. The number of environmentally sensitive areas was increased and the reorientation of the capital grant scheme was announced.
The different sectors of United Kingdom agriculture fared very differently during 1988. The situation of the industry reported in the document is therefore a complex one, but the following are among its main features.
Cereal and oilseed rape yields were low due to poor weather and because of this and lower prices the value of output was significantly reduced. The value of output of potatoes fell sharply as a result of lower prices. Horticulture had a relatively good year, with most parts of the sector recording a higher value of output.
Within the livestock sector, higher beef prices and increased production of lamb maintained the output value of these meats, but lower prices for pigmeat meant that this sector was depressed for much of the year. Milk production was further reduced by the quota arrangements, but the value of output was maintained by price increases. Production of poultrymeat continued to expand, but lower prices reduced the value of egg production. The forecasts exclude the effects of the recent disturbance in the egg market.
There was little change in the overall quantity, average price or value of the industry's output, but with higher input costs its net product fell by nearly 7 per cent. which, after providing for labour and interest costs and net rent, was reflected in a 25 per cent. fall in farming income. However, no single measure can fully reflect the situation in such a diverse industry, and a variety of different compilations of the aggregate statistics, both United Kingdom and EC, can give different results. It is for that reason, among others, that I have recently suggested that we need a more sophisticated analysis of what is happening to farm incomes than a single aggregate measure can give. The document provides other indicator's of farming prosperity which show smaller falls. It also shows that there were considerable income variations among farm types. While the arable and intensive livestock sectors did less well, net income from dairying and hill and upland livestock farms showed marked increases in all parts of the United Kingdom, and net income from lowland livestock increased in England and Scotland. Overall, England fared less well than Scotland, Wales and Northern Ireland.
For the first time Inland Revenue sample data are included in the document. They indicate that income from farming has accounted for 50 to 60 per cent. of total taxable income in recent years. Other earned income has contributed a further 15 to 20 per cent. It is the Government's policy to encourage farmers to find ways of generating an increasing proportion of their income from activities which respond to market demand, including alternative employment of assets and business skills on the farm.
These are sample data relating to earlier years. Further research and surveys are needed to get a more precise and accurate picture of the income position of farming households, and we are undertaking these.