§ Mr. Mylesasked the Minister of Agriculture, Fisheries and Food whether he has completed his review of hill livestock allowances; and if he will make a statement.
§ Mr. Peter WalkerOn 5 July I informed the House that in October my right hon. Friends and I would carry out a review of the economic conditions in the hill livestock sector in consultation with the farmers unions. I undertook to announce our conclusions in November. We have now carried out this review. We have taken into account the difficulties experienced by many producers, especially hill sheep farmers, as a result of last winter's severe weather, including an above average loss of animals and greatly increased feed costs. We have also had regard to the relatively depressed state of store market prices this autumn. The overall situation points to a substantial fall in net farm incomes in the current year in this important sector of farming. We have concluded that there is a need for sizeable increases276W in the rates of hill livestock compensatory allowances to be paid next year.
We have therefore decided that, subject to parliamentary approval, the rate for hill cows should be increased from £29 to £35, an extra £6; the higher rate for hill sheep, from £3.60 to £5.50, an extra £1.90; and the lower rate for hill sheep, from £2.85 to £4.25, an extra £1.40. The increase in the higher rate for sheep includes and consolidates the 50p increase announced in July.
Draft regulations to implement these increases, which will be worth £20.6 million, have been laid before Parliament today.
That part of the cost which falls in 1979–80 will be financed from the Contingency Reserve, and Supplementary Estimates will be presented in due course.
These increases will be paid with the allowances due at the beginning of 1980.
My right hon. Friends and I consider that the increases in the allowances represent a substantial expression of our belief that hill and upland farmers should enjoy a reasonable standard of living.