§ 68. Sir T. Dugdaleasked the Minister of Agriculture whether, in view of the forthcoming price review, he will now 218W announce any changes which he proposes in the direct subsidies at present paid to farmers; and whether all such changes will be taken into account at the review.
Mr. T. WilliamsYes. In view of impending annual price review, I am taking this opportunity to announce certain decisions which have had to be taken by the Government. The effect which they will have on the costs of farmers will be taken into account in the course of the review.
A year ago, following the annual review, three new ad hoc subsidies were introduced. Full use is not being made of them in all cases and there are certain unavoidable weaknesses in their administration, with the result that they have had almost as many critics as friends. The Government have accordingly decided that, after settlement of claims arising from the first year's operation of the scheme, it will cease payment of the grants in respect of farm tractors and other machines using petrol. From 1st May, payment will cease of the subsidy on the supply of feedingstuffs below cost to farmers in a small or moderate way of business producing milk, pigs and eggs, who owing to the nature of their farms have little opportunity of making their holdings reasonably self-sufficient. From 1st July next we shall also bring to a close the grant made towards the cost of fertilisers applied to grassland, but will continue the grants on the application of fertilisers after the ploughing up of grassland of at least seven years' standing.
The existing rate of contributions towards the cost of acquiring and transporting lime will continue at 50 per cent. but, except for claims already arising, no contributions towards the costs of spreading will be made in respect of lime spread on the farm on or after the first of April next.
The effect of the discontinuance of these subsidies upon farmers' costs of production will be taken fully into account in assessing the economic condition and prospects of the industry at the forthcoming review.
My colleagues and I recognise that agriculture is an important element in our national defences, and that it is essential to maintain the industry in a state of high efficiency and to preserve the fertility of the soil. We are satisfied 219W that the measures to which I have referred should not have any significant adverse effect upon the expansion of agricultural production, and that it should still be possible to achieve in full the five-year expansion programme upon which we embarked in 1947.