Expenditure (Hansard, 17 November 1983)

§ Mr. Jopling

As announced in the statement of my right hon. Friend the Chancellor of the Exchequer today, planned expenditure on agriculture, fisheries and food in 1984–85 will be £2,256 million. This is £437 million higher than previously planned. Of this sum, £422 million provides for additional expenditure by the Intervention Board for Agricultural Produce, mainly in respect of an expected increase in the level of intervention for butter and skimmed milk powder; the remaining £15 million is a net increase in planned expenditure by the three agricultural Departments. Certain increases are inescapable under present arrangements, mainly for market support under the CAP, although in this case most of the expenditure is either pre-funded by the Community or reimbursed when intervention stocks are sold. My colleagues and I have however been anxious to ensure that these programmes contribute to the Government's aim of constraining the growth of public expenditure.

Against this background we have made a careful assessment of priorities in the light of changing circumstances. Amongst the changes to agricultural programmes we have set aside funds to meet commitments 556W to the glasshouse industry and to the marginal land areas and we are taking the opportunity to make some changes in the capital grant schemes.

I am pleased to announce that, despite the pressures on public expenditure we shall be maintaining unchanged in 1984 the present levels of hill livestock compensatory allowances. I also want to repeat our firm intention to provide additional assistance to the marginal land areas once the Community has approved our application to give them less favoured area status and intend to provide more details shortly.

The capital grant schemes will be modified to give additional incentives to improve the use of energy in the glasshouse sector. We shall be reducing incentives elsewhere in order to simplify the schemes and make them more selective, while as far as possible preserving the enhancement of grant rates for less favoured areas relative to those in the lowlands. The changes involved will result in savings of about £30 million a year. Investment is, however, now expected to be higher than previously forecast so that in 1984–85 total expenditure on capital grants is expected to be about the same. Details of the changes will be given in orders I shall shortly be laying before Parliament.

There will be other savings totalling over £11 million which include the winding up of the Land Settlement Association schemes, adjustments in provision for research and development, and other economies principally in administration. In addition savings of some £11 million will be made by my Department in assistance for arterial drainage and flood protection, partly through 557W reducing the rate of grants by 5 percentage points. These savings will be mainly reflected in the external financing limit for water authorities.

The planned total for 1984–85 provides for the continuance of assistance for meat export certification which was announced on 22 April 1983—[Vol. 41, c. 198–99]; for additional assistance to the United Kingdom pig processing industry under Regulation EEC 355/77; and an increase in aid available towards the cost of forming and developing new co-operative ventures.