Previous SectionIndexHome Page


Mr. Peter Atkinson (Hexham): My right hon. Friend will realise that hill farm incomes have fallen by 20 per cent. Recently, farmers in Northumberland tackled the Minister of State, the hon. Member for Birmingham, Perry Barr (Mr. Rooker), to ask what he intended to do about hill livestock compensatory allowance payments. The Minister replied:

4 Nov 1997 : Column 179


    "I thought there was some better news around--but I have forgotten what it is."

Will my right hon. Friend press the Minister of State to see whether he can remember what good news he had for hill farmers?

Mr. Jack: I thank my hon. Friend for his intervention. I tried to find out what the Minister of State said at the Great North Meet. According to a newspaper report,


What is this system? Is this some new agricultural world in which Ministers live? It is hardly surprising that they are cut off from the countryside; they are in the system, and there is something floating about in it--probably the Minister.

The Minister of State went on to make this devastating commitment--[Hon. Members: "Get on with it."] I am sorry if Labour Members do not like the truth, but this is what their Minister is saying. He said that Labour


and so on. All the soft words in the world do not take away from the fact that, as I shall outline in greater detail, he has already told hill farmers, "I am taking away £60 million from the hill livestock compensatory allowance. You are back to 1996. I do not care what arguments you put, because I am not going to listen to you. You are not going to come and see me--"

The Minister of Agriculture, Fisheries and Food (Dr. John Cunningham): Later I will welcome the right hon. Gentleman and congratulate him on his appointment, but now I will intervene as briefly as I can. The right hon. Gentleman was a Treasury Minister in the previous Administration. Did they make any provision for continuing that support in this financial year or next year?

Mr. Jack: As the right hon. Gentleman is not a Treasury Minister, I suggest that he goes back to the Red Book, where he will find that there is a year-on-year increase. I will explain later how he can easily afford that within his budget, as he will also know the way in which the European public expenditure survey works. Let us have none of this nasty business of tripping me up at this stage. I suggest that the Minister does his homework and goes back and looks at the Red Book, where he will see that for the next financial year there is an increase, not a decrease, compared with this financial year.

Mr. David Maclean (Penrith and The Border): Perhaps in the course of his remarks my right hon. Friend will ask the Minister of Agriculture, Fisheries and Food not whether there was a provision but whether he even asked the Treasury for something for HLCAs.

Mr. Jack: My right hon. Friend is right. That is why under the fundamental expenditure review I concentrated on the fact that the Minister had already given it away before he started on the current exercise of not listening to the hill farmers. I do not think that he bothered to ask the Treasury, and he should speak to his own accounting officer. I shall try to help him out later and find him some money, as I have done a little homework on that.

4 Nov 1997 : Column 180

I remind the right hon. Gentleman that under our tutelage and our stewardship of the Ministry of Agriculture, Fisheries and Food, whereas at one time agriculture accounted for 73 per cent. of the European budget, we helped to negotiate that down to 50 per cent. Our record of agricultural stewardship stands examination.

If the Minister wants to attack us for the past 18 years, why has he, together with his colleague from the Department of the Environment, not had the courage to say that he will produce a parallel to "Rural England 1996", which contains 140 separate commitments from my party to the countryside? It is the only comprehensive record of countryside policy that exists. The Government do not have one.

Mr. Peter Bradley (The Wrekin): The right hon. Gentleman commended to the House his Government's stewardship of the countryside over the past 18 years. How would he account for the fact that the landslide on 1 May was almost as impressive in the countryside as it was in the towns? Some 50 seats there fell to the Labour party on 1 May and several more fell to the Liberal Democrats. Can he account for that phenomenon?

Mr. Jack: The hon. Gentleman should look at a map, and he should listen to the voices of disillusion, especially from the hills. He would realise that people understand the message from the Opposition.

Let us deal with the meat of the debate. The first item that we want to discuss is farm incomes. The Minister knows that farmers face severe problems because of the appreciation of sterling against the ecu. One of my hon. Friends mentioned an increase of some 20 per cent. The Minister seems to have ignored the effect on farm incomes of the two summer revaluations in the green pound, which took place since his party has been responsible for agriculture policy.

Some of that is connected with the fact that the Government have abrogated their responsibility for the setting of interest rates and given it away to the Bank of England. I am sure that if we had been in charge none of that would have occurred. Labour has some responsibility for what has happened to sterling in respect of the appreciation against the green pound and the reductions in farm income that have taken place.

Despite the fact that a freeze occurred on certain green rates within some support schemes, the National Farmers Union has calculated that given the effect on prices of agriculture commodities there has been a loss in output value terms of between £1.7 billion and £1.8 billion. Higher estimates have been circulated, but I have chosen to quote lower figures because I believe that they are realistic. It has been suggested that losses could have been as high as £3.5 billion, a sum equivalent to that which we spent on bovine spongiform encephalopathy.

The Minister will be aware that a new compensation mechanism was agreed under the new agri-monetary regime, which I am sure has been considered in considerable detail. I remember when the matter was debated in the House, when to the best of my recollection the then Labour Opposition did not oppose the adoption by the United Kingdom of the then proposals. I take that to mean that the then Labour Opposition agreed with them.

4 Nov 1997 : Column 181

It is interesting that the Minister, who appeared before the Select Committee on Agriculture today, admitted under questioning, so it is reported, that about £980 million could be available to the United Kingdom for compensation for loss of value of farm output. That applies to losses incurred in the dairy, beef, cereals and sugar sectors. What do the Government intend to do within the remit of the mechanism?

So far the Minister has shown no enthusiasm for dealing with the problems now besetting certain agricultural sectors as a result of a severe and sudden drop in income. As the Minister knows, other member states facing circumstances similar to those confronting the United Kingdom have used the mechanism to which I have referred. I hope that the right hon. Gentleman will comment on that. Germany, in particular, argued for the implementation of the mechanism when it, too, was facing a similar situation to that experienced by the United Kingdom. The Minister owes it to the House to explain why he chooses not to use the mechanism that was urged especially by Germany to deal with the broad range of issues, and why he is not prepared to do that in compensating farmers for the losses that they have incurred up to January 1998.

Is the Minister prepared to consider some of the sectoral impacts of the fall in farm incomes? He will know that in spite of the efforts to help the beef sector it continues to face considerable difficulties, certainly in terms of values.

Dr. John Cunningham: Whose fault is that?

Mr. Jack: It is all very well for the Minister to ask whose fault it is. The Minister is responsible for these matters and he represents the Government's views. The Opposition are asking questions on behalf of Britain's farmers in the rural community, and he owes them an answer. If the Minister is not prepared to compensate across the board, is he prepared to focus on the hardest-hit sectors? I am thinking especially of beef, sheep and dairy. Milk prices have fallen substantially and given the appreciation of sterling there is considerable import pressure. Surely the right hon. Gentleman can bring himself to focus on the genuine needs of the sectors to which I have referred, given the circumstances that I have described.

The second and substantive part of the motion relates to hill farming. I have alluded already to the cavalier way in which the Minister appears to be treating hill farmers. It is interesting to reflect on the terms in which the previous Minister of Agriculture, Fisheries and Food announced that there would be an additional £60 million for hill and upland farmers. His announcement was the result of the normal discussions with hard-pressed hill farmers, and an additional £60 million was included in the hill livestock compensatory allowance for that year.

The Minister will know that rates have traditionally been set as a result of discussion between the Minister of the day and territorial representatives of each of the major farming organisations. So far, as I understand it, those representatives have been sent to talk to their territorial Ministers, the Minister of Agriculture, Fisheries and Food having refused to meet them.

4 Nov 1997 : Column 182

In a press release last year, the Minister stated:


The right hon. Gentleman acknowledged the difficulties that were faced that year. Hill farmers will have reminded the Minister that the year to which they are looking in terms of HLCA will be no less difficult.

How has the Government's attitude been viewed so far in the farming press? Farmers Weekly on 19 September described the Minister's stance as "wanton vandalism". It stated:



Next Section

IndexHome Page