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House of Commons

Thursday 16 March 2000

The House met at half-past Eleven o'clock


[Madam Speaker in the Chair]


London Local Authorities Bill [Lords] (By Order)

Order for consideration read.

To be considered on Thursday 23 March.

Kent County Council Bill [Lords] (By Order)

Medway Council Bill [Lords] (By Order)

Mersey Tunnels Bill (By Order)

Orders for Second Reading read.

To be read a Second Time on Thursday 23 March.

Oral Answers to Questions


The Minister was asked--

Farm Incomes

1. Mr. Michael Fabricant (Lichfield): If he will make a statement on the change in farm incomes over the past three years. [113368]

The Minister of Agriculture, Fisheries and Food (Mr. Nick Brown): From 1996 to 1999, total income from farming fell by 56 per cent. in real terms. Total income from farming increased by 100 per cent. in real terms between 1990 and 1995, before dropping 60 per cent. between 1995 and 1999.

Mr. Fabricant: I am grateful for that honest answer, at least. However, does the Minister yet realise that, in the past three years, farmgate milk prices have fallen by a third, more than 5,000 dairy farmers have given up work, the cost of milk production is 11p per pint and the farmgate price paid is less than 10p a pint? Mr. Micawber would tell the right hon. Gentleman what that means. How long can he remain complacent? Will he be satisfied when the only milk that we can buy in the United Kingdom is frozen milk from France?

Mr. Brown: I am not complacent about the difficulties in the dairy sector. The Government are examining what they can do to help. As the House will know, the remedy lies in the supply chain and in the marketplace.

Mr. David Taylor (North-West Leicestershire): As my right hon. Friend knows, agriculture receives more

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subsidy than the rest of British industry put together, and it has the lowest incomes for a long time. Is he confident that we are taking genuine and radical steps to move farming away from its dependence on subsidies and transform the common agricultural policy into something that resembles more closely a rural development policy?

Mr. Brown: My hon. Friend makes a good point. The supply side of the CAP, although it is extraordinarily expensive, does not serve United Kingdom agriculture well. That is why, last December, I announced the new direction for agriculture and our making much more use--something that is a departure for the UK Government--of the new second pillar of the CAP, which provides support for farm businesses that is decoupled from production and directed much more to the marketplace than to the CAP's traditional structure.

Mr. David Heath (Somerton and Frome): With dairy farm incomes continuing to fall, with milk prices the lowest in Europe and with supermarkets pushing their three-for-two offer--they buy three litres of milk and pay farmers for only two--is it not time for more action? Will the Minister look again at agrimonetary compensation before it is too late? Will he think about the over-30-months scheme and will he talk some sense into his colleagues at the Department of Trade and Industry on milk co-operatives and on concerted efforts to increase milk prices?

Mr. Brown: As the hon. Gentleman knows, I have been a strong advocate of farmer co-operation working through the supply chain. I believe that real benefits accrue to farmers if they are able to exercise some influence further down the supply chain. As for the over-30-months scheme, surely the Government's real objective should be to work towards an unwinding of the scheme. That is clearly obtainable in the medium term. As my right hon. Friend the Prime Minister made clear at the National Farmers Union conference, the door is not closed on agrimoney.

Mr. Lindsay Hoyle (Chorley): Following the comments of my hon. Friend the Member for North-West Leicestershire (Mr. Taylor), I am sure that the House has recognised that more money has gone into farming through this Government than through any previous Government. However, I am sure that my hon. Friend is aware of the plight of dairy farmers in Lancashire, who are being paid the lowest prices. Will he have discussions with supermarkets and other middle men paying low and unjustified prices? All that they are doing is putting our poor farmers out of business. I am sure that, with my right hon. Friend's good offices, we can improve the plight of farmers.

Mr. Brown: My hon. Friend is right. The answer to the problem lies in the supply chain and ultimately in the marketplace. There are not sufficient sums available under the agrimonetary compensation regime, for example, to compensate farmers for the difficulties that they are going through. Of course there are measures at the margin that the Government could take to help. However, we must focus on the real problem, which is the marketplace.

Mr. Tim Yeo (South Suffolk): Given that many dairy farmers are selling their milk at a price below the cost of

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production, does the Minister support the plan announced today by Safeway and Waitrose to increase the price of milk--yes or no?

Mr. Brown: I have made it absolutely clear in all my answers that the difficulties can be resolved only through the supply chain and in the marketplace. That is why I support the initiatives of retailers that are designed to help their own producers. They have my support and encouragement, but these are private sector arrangements. The hon. Gentleman has listened carefully to my answers, and I notice that those on the Opposition Front Bench are not coming forward with a remedy of their own.

Environmentally Sensitive Areas

2. Mr. Phil Woolas (Oldham, East and Saddleworth): What recent assessment he has made of the benefits of the environmentally sensitive areas scheme for wildlife in rural areas. [113369]

The Parliamentary Secretary to the Ministry of Agriculture, Fisheries and Food (Mr. Elliot Morley): Detailed monitoring has taken place since the scheme was introduced in 1987. The results have been used to adapt and refine the scheme to increase environmental benefits.

Mr. Woolas: I thank my hon. Friend for that reply. The environmentally sensitive area scheme has been welcomed in my constituency. Baroness Young, the chair of English Nature, has described it as the most important decision on the countryside for 20 years. However, can my hon. Friend help my constituent, Mr. Graham Tibbot of Belle Vue farm in Delph, who faces an apparent contradiction over stock density between the ESA scheme and the proposed hill farm allowance scheme? Will my hon. Friend examine that case?

Mr. Morley: I support my hon. Friend's comments on ESAs, which are valuable and provide genuine benefits. The scheme involves some restrictions on stock density, and I appreciate that that can cause anomalies in payments such as hill livestock compensatory allowances. I assure my hon. Friend that we are only too pleased to examine the matter in detail. I shall write to him.

Mr. Desmond Swayne (New Forest, West): However beneficial the scheme may be, might it not be thoroughly undermined if hedgerows were grubbed up? Will the Minister put on record the remarks that he made earlier when I tackled him in the water closet, where he said that there is some prospect of seeing off the European directive?

Mr. Morley: I need to be careful about giving the hon. Gentleman privileged access.

I want to make a serious point about the recent directives from the Court of Auditors on field boundaries. There is some logic to them, because the European Union pays a subsidy on the cropped area, which may not always extend right up to the field boundary. However, that is a traditional method of farming in this country. That was acknowledged when we agreed the scheme, which was based on Ordnance Survey maps, with the European Commission. There are risks to the environmental benefits of hedgerows and uncropped edges of fields. We are

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discussing that with the European Commission, and we hope that we can reach a workable and reasonable compromise.

Wild Birds

3. Mr. Hilary Benn (Leeds, Central): What action he is taking to halt the decline in the number of wild birds in rural areas. [113370]

The Parliamentary Secretary to the Ministry of Agriculture, Fisheries and Food (Mr. Elliot Morley): The Government's strategy for sustainable development includes a headline indicator on the populations of farmland and woodland birds, which have declined significantly in the past 25 years. Halting and reversing the decline will take time, but our recently announced switch of funding from production support to environmental measures is evidence of our determination to improve that important indicator.

Mr. Benn: I am grateful for my hon. Friend's reply. Does he know that the Royal Society for the Protection of Birds has recently bought a lowland arable farm, aptly named Hope farm, to develop agricultural methods that are economic and good for farmland birds and other wildlife? I welcome the increased investment in countryside stewardship in its broadest sense, but will my hon. Friend tell the House his plans for drawing on the lessons of that important research?

Mr. Morley: I agree that that is important research. The RSPB should be congratulated because we must consider the most appropriate changes in agricultural practice to tackle the decline in many farmland species. Those changes can be supported through schemes such as countryside stewardship. I am glad to say that we are increasing the number of schemes that we intend to accept from 1,600 last year to 3,000 this year.

Mr. Tony Baldry (Banbury): Is not the policy of ripping up English hedgerows and destroying field margins crazy? It is especially crazy given the Bill on access to the countryside that we will consider on Monday. When I was a Minister of State in the Ministry of Agriculture, the Commission endorsed the use of Ordnance Survey maps and satellite monitoring. We should not be considering finding a fair and reasonable compromise, but seeing off the Commission, and pointing out that it agreed to something several years ago and asking how it can accept ripping up English hedgerows. The present policy simply gives ammunition to some of my Euro-sceptic colleagues. Will the Minister tell the Commission that that policy is crazy?

Mr. Morley: It should be remembered that the root of the problem is subsidies to the CAP regime and the way in which they work. However, we believe that the Commission should take into account the practices that have been established in our country. It has agreed to a tolerance of 2 m either side of OS boundaries. That effectively creates a 4 m boundary.

We do not want to over-estimate the impact of the policy because many farms will not be affected by the changes. However, there should be a more flexible approach towards

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farms that might be caught by the policy. It is not beyond the realms of possibility to agree that approach with the Commission. We are trying to do that.

Dr. Brian Iddon (Bolton, South-East): In reading the tea leaves, may I take it that my hon. Friend believes that there are alternatives to the pesticides tax, or is it still under consideration?

Mr. Morley: The Prime Minister announced at the National Farmers Union conference that the pesticides tax is not under consideration. There is an argument for various forms of financial instrument, but we must consider the impact that applying them would have on the sector and balance that with the potential benefits. A pesticides tax could have detrimental effects; in addition, more advanced and more environmentally friendly pesticides could be introduced.

Mr. Malcolm Moss (North-East Cambridgeshire): Now that the Government are preparing to compromise on section 28 in the teaching of the birds and bees, will they do another U-turn on an issue affecting the real birds and bees? Given the 15 May deadline for the integrated administration and control system applications, does the Minister appreciate the urgent need to reverse the recent rule change that is forcing farmers to destroy hedgerows and their habitats, on which wild birds depend for food and cover?

Mr. Morley: Let me make it perfectly clear that this is not a rule change, but an interpretation following a visit from the Commission and the auditors in relation to the application of arable area payments through the IACS scheme. It is not a change in respect of the area that is cropped and the area that is paid and we believe that any change or interpretation that could have a detrimental environmental effect on hedges and field boundaries is to be deplored. We are working with the Commission and my right hon. Friend the Minister has had a meeting with Franz Fischler. We were encouraged by the Commissioner's sympathetic response.

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