§ Mr. Andrew F. Bennettasked the Minister of Agriculture, Fisheries and Food what is the test discount rate used for assessing the projected benefits of (a) any public works and (b) arterial land drainage schemes financed with Government grants; and over what period of time the costs and benefits of such projects are normally assessed.
§ Mrs. FennerThe test discount rate that is used for assessing benefits in arterial drainage schemes is 5 per cent. The rate that is used in other public works is a matter for the Minister concerned in consultation with the Treasury.
268WCosts and benefits are assessed over the estimated life of the drainage scheme. In practice, this does not normally exceed 50 years.
§ Mr. Andrew F. Bennettasked the Minister of Agriculture, Fisheries and Food what criteria he applies and whether, and if so what, guidelines have been given, to regional water authorities on the assessment of costs and benefits of arterial drainage schemes which attract grant-aided under the Land Drainage Act 1976; and whether he will make available any relevant documents containing details of these guidelines.
§ Mrs. FennerThe criteria which are used for assessment of benefit in proposed arterial drainage schemes depend upon the nature of the benefit. Where the purpose of the scheme is to prevent flood damage, the benefit is assessed by reference to he damage which has occurred or 'which may occur in floods of a specified intensity or duration.
Where the purpose of the scheme is the improvement of the drainage of agricultural land, the benefits are assessed by reference to the estimated increase in value of the agricultural production from the land when the scheme has been carried out.
I am sending the hon. Member copies of the guidance notes which have been issued to water authorities on this matter.
§ Mr. Andrew F. Bennettasked the Minister of Agriculture, Fisheries and Food whether, in the light of the evidence presented at the Amberley Wild Brooks, West Sussex, and Gedney Drove End, Lincolnshire, public inquiries, he is satisified with the procedure employed by his Department for assessing the agricultural costs and benefits of such schemes; and if he will make a statement.
§ Mrs. FennerThe method which is recommended by my Department for assessing the costs and benefits of arterial drainage schemes was revised following the Amberley Wild Brooks inquiry. I am satisfied that the assessments which are made by drainage authorities represent a fair and reasonable way of determining the cost effectiveness of schemes.