Earl Fortescueasked Her Majesty's Government:
To make a statement about the future of farm capital grants.
The Parliamentary Under-Secretary of State, Ministry of Agriculture, Fisheries and Food (Baroness Trumpington): Since the Agriculture Improvement Scheme (AIS) was introduced in 1985 there have been many important changes in our agricultural policy. Amongst these, we have introduced a number of initiatives to assist farmers in conserving the countryside and controlling pollution. In the European Community we have also made good progress in dealing with surpluses and bringing production more into line with demand. In consultation with my right honourable friends the Secretaries of State for the Environment, Wales, Northern Ireland and Scotland and the Chief Secretary to the Treasury, my right honourable friend the Minister of Agriculture, Fisheries and Food has been reviewing the agriculture improvement scheme to see whether capital grants can more closely reflect these changing priorities.
As a result, he has decided to introduce a new grant scheme called "The Farm and Conservation Grants Scheme" in February 1989. Its provisions have still to be negotiated with the EC Commission but, subject to obtaining that agreement, the Minister plans to make the following changes.
First, he intends to increase the assistance we offer to lowland farmers to install facilities for the storage, treatment and disposal of slurry and silage effluent. Grant rates in the lowlands will be significantly 295WA improved and the coverage extended, for example, to include fixed disposal piping and safety fencing. My right honourable friend the Minister has agreed with my right honourable friend the Chief Secretary a provision of up to £50 million over the next three years on these grants. This compares with £17 million spent in the first two years of the AIS. Reducing the incidence of farm pollution must be a top priority for the industry. By these means the Government will be further assisting farmers in tackling their problems.
Secondly, the Minister plans to introduce three new conservation grants. These will encourage the regeneration of native woodlands and of heather moors and assist in the cost of repairs to vernacular farm buildings.
It is clear that certain grants which have helped to stimulate the productive capacity of the industry in the past are less appropriate in present circumstances. Grants for new farm buildings, roads, and one or two minor items will be discontinued. Grants which help to keep grazing land in good heart will remain.
For horticulture, enhanced rates of grants for the replacement of heated glasshouses will also remain, with grants for orchard replanting being resinstated, both until the end of 1993.
The Minister believes that it is important that the grants, with their increased emphasis on pollution and conservation, should reflect the fact that these are priority areas for farms in both the lowlands and Less Favoured Areas. The Minister plans, therefore, to narrow the differential for most grants to 10 per 296WA cent. The Minister would, however, expect the grassland grants and the three new conservation grants to be of particular benefit in the Less Favoured Areas.
The arrangements recently announced by my honourable friend the Parliamentary Under-Secretary of State at the Department of the Environment under which national park authorities can offer additional grants on some items up to a maximum of 80 per cent. will now be adopted to the new grant scheme.
To ensure proper management of the transition from the current scheme to be new one, the Minister is closing the Agriculture Improvement Scheme forthwith. Orders taking immediate effect were laid before Parliament yesterday. Farmers who have already committed themselves to investment in the expectation of claiming grant will now have until 31st May to deliver their claim unless they hold (or have applied for) an improvement plan. Grants already included in an approved improvement plan or one on which approval is awaited will not be affected by the closure. Two specific categories of grant will also be exempt from the closure orders. These are the special glasshouse replacement grants which the Minister announced in July and those for growers in the Isles of Scilly on which orders were laid on 16th November. In addition, in Northern Ireland only, my right honourable friend the Secretary of State will continue the grants for waste disposal which have only recently been reintroduced there.