HL Deb 12 February 1991 vol 526 cc2-3WA
Lord Gainford

asked Her Majesty's Government:

Whether they have completed the review of the economic conditions in the hills and uplands.

The Minister of State, Ministry of Agriculture, Fisheries and Food (Baroness Trumpington)

My right honourable friends have now completed the annual review of the economic conditions in the United Kingdom's Less Favoured Areas, in consultation with representatives of farming interests. The review has shown that average net farm incomes of livestock producers in our hill and upland areas are forecast to fall even further in 1990–91 following the significant decline also experienced in the previous year.

We have concluded that, in response to the exceptionally difficult circumstances faced by producers, there should be increases in all the rates for hill livestock compensatory allowances but with larger increases for the sectors in greatest difficulty.

Subject to Parliamentary approval, the new rates will be as follows:

Severely Disadvantaged Area Disadvantaged Area
New Rate £ Existing Rate £ New Rate £ Existing Rate £
Cows 63.60 (54.50) £31.65 (27.25)
Hardy Breed Ewes 8.75 (7.50) n/a
Other Ewes 4.90 (4.50) 2.45 (2.25)

The new financial limit of 1.4 livestock units per hectare comes into effect from 1st January 1991 and will limit payments to those producers who stock above this level. There will be no other changes to the conditions of the scheme.

We shall be laying before Parliament a draft statutory instrument giving effect to the new rates as soon as possible. The increased rates are expected to cost £17.5 million in a full year.

This 14 per cent. average increase, which follows an increase for hardy breed ewes worth over £5 million last year, will bring HLCA payments in the United Kingdom to some £142 million in a full scheme year.

All sectors of agriculture face a period of change. There is the need to adapt to new market requirements and to find support arrangements which pose a less severe budgetary burden and reflect environmental concerns more effectively. No sector can be exempt from change. But this substantial and increased level of support indicates the Government's continuing commitment to livestock farming in the less favoured areas with the additional contribution it brings in ensuring economic activity in these difficult areas and in providing environmental benefits.