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2.41 pm

Mr. Mark Todd (South Derbyshire): I apologise for missing the almost certainly excellent speech of my right hon. Friend the Minister--I regret that deeply--and a significant part of the contribution of the Opposition spokesman on agriculture, the hon. Member for South Suffolk (Mr. Yeo), which I regret rather less.

The debate gives us a further opportunity to discuss the present and future of British agriculture. At one stage last year, we had more opportunities to discuss the topic than any other matter before Parliament, with debates almost weekly. As I participated in many of those, I regret that many hon. Members will have to put up with hearing similar views to those that I expressed then, with a small amount, regrettably, of "I told you so" and references to recommendations that I made previously.

I begin by outlining my credentials for speaking on the subject. Within South Derbyshire district, which includes three quarters of my constituency in population terms and far more than that in area, agriculture employs more than 5 per cent. of the work force, on the latest figures. It remains a major contributor to my local economy and to the shared environment of the citizens whom I am proud to serve.

The district contains most forms of agriculture. I have the pleasure of being able to touch on almost any aspect that anyone could raise on an agricultural topic--sheep, dairy, beef, horticulture, poultry, pigs and arable farming all exist, with varying degrees of health, in my area. The area's performance accurately mirrors what has happened in the broader agriculture sector in the past three years.

All sectors have struggled, particularly in the past two years. In the first year, there were some exceptions. The same situation has been reported elsewhere. Most of us will have received the statistics on farm incomes. I would not claim that my area is atypical; that has been broadly my experience as well.

I regularly visit farms and meet farmers. In some areas, perhaps one half of the farms have been sold to neighbours and transferred on to become larger units. It is an attractive area, near Derby, and the farm buildings are regularly redeveloped for housing purposes. There are examples of local enterprise in facing the current problems. A successful golf course has been established on farm land near Derby in my constituency. That activity earns a good deal more money than the farming activity that preceded it. There is an extremely successful cleansing and packaging operation focused on root crops--

Mr. John Hayes (South Holland and The Deepings): I am grateful to the hon. Gentleman for giving way. I do not mean to interrupt the travelogue of Derbyshire, which is charming and entertaining, and I acknowledge, as ever, the hon. Gentleman's commitment to agriculture and his

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measured way of dealing with the topic. He speaks of having a variety of agriculture in his constituency. Are his arable farmers as disappointed as mine are in Lincolnshire that, in all the packages that the Minister mentioned today and introduced in the House previously, there has been almost no help for hard-pressed arable farmers, including tenant farmers, such as those who were mentioned earlier?

Mr. Todd: I thank the hon. Gentleman for his intervention. Because of the mixed nature of the farming that predominates in my area, there are few farms where arable farming is the dominant type. Farmers will usually have a certain amount of barley, for example, as part of their farm's activity, but the arable sector would not be the major goal of their operation. I have therefore been less exposed to comments on that than the hon. Gentleman.

I shall continue. There is a highly successful washing and packaging operation in my area, based originally on a mushroom farm. That is still there, but the person involved has invested successfully in an operation that takes potatoes and other root crops from neighbouring farms and washes them, cuts them precisely and packs them neatly for the catering trade. He has established an extremely successful business around that. He is a successful entrepreneur from a farming family and is still a member of the National Farmers Union. My only regret is that he is about to move out of my constituency because of the need to expand his activities.

That example demonstrates some of the successes that there have been. Another is added-value investment in the poultry sector. There is one large poultry operator in my area, and a neighbouring plant produces added-value product for the supermarket trade. There are indications of diversification, development and added value in farming units in my area, but many farmers have simply struggled through. I would not pretend otherwise.

We have heard reference to tenant farmers, and I shall not hold back on that, as there are a number of tenant farmers in my area. Farmers have few options if they do not have a property asset, which, as I said, is worth a reasonable amount in South Derbyshire, because the area has good communication links and the planning authority has tended to be broadly supportive of changes in use--although there have been some exceptions, about which I would argue.

Farmers who do not have a property asset are left with their stock, which is worth painfully little. There are some encouraging signs. Others will have touched on the improvement in the price of pigs. There is only one pig operator in my area, and that improvement will allow him at least to break even. That is also true of the sheep sector, where there has recently been an improvement in prices and some prospect of recovery. However, many tenant farmers are forced to rely on their stock, which, in some cases, they bought for significantly more than they can raise from it now, and there is no exit strategy that they can use.

There is, none the less, much to commend in what the Government have attempted to do. The rural development plan offered the prospect of expansion of some successful schemes, such as the countryside stewardship scheme, and woodland and organics support. Welcome initiatives have been introduced for energy crops, and some much- missed supports, particularly for marketing, have been

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reintroduced. I stand to be corrected, but I believe that those were scrapped under the previous Government, not the present one. Since then, the farmers whom I represent have called for the reinstatement of such schemes. There are welcome new initiatives, existing initiatives have been extended, and initiatives that had gone have been reintroduced.

Genuinely new Government money is being offered to match cash modulated from support payments and existing European Union funds. The total value of the schemes is £1.6 billion over the next seven years, and the trend is rising. I shall say more about that later, but let me say now--this is merely a comment, not a criticism--that, although £1.6 billion is a substantial sum, it is a small amount in the context of all the support that will be given to agriculture over the period. The Minister seems to assent to what I have said, and I do not think he interpreted it as a criticism. It is, after all, merely a statement of fact.

We have made a good start if our aim is to develop a strategy focused on encouraging diversification, to improve the business skills of the farming community--which is clearly linked to the first objective--to enhance our environment, and to make the farm sector less dependent on subsidies for the driving of its main business activities. That last aim is as critical as any. As I have said, it is a good start, but it is only a start. Over a period, we must weight the balance of the budget much more in favour of measures such as those I have mentioned, and away from simple production support.

I have reservations about the package, some of which I have shared with Ministers and others. I shall now share them with you. [Interruption.] I mean that I shall share them both with you, Mr. Deputy Speaker, and with the rest of the House. [Laughter.] We should not discuss the subject so lightly. Perhaps it is familiarity with my speaking on such topics that produces this reaction.

The money available is heavily loaded towards the latter end of the seven-year period, which is regrettable. I have vigorously, even repetitively, asked for help for modernisation in earlier debates, and I am delighted that the Government now espouse my view; but that help is needed now, on a rather greater scale than will be possible in 2000-01 or, indeed, in the following two or three years.

We have already seen, in the organic sector, how the offer of existing small-scale reform money is rapidly oversubscribed. I willingly accept that there are strong arguments for balancing expenditure of this kind against market expectations, and that flooding the available marketplace for support for organic conversion with money is likely to lead to the potential impoverishment of organic farmers. Like, I am sure, many Members who represent farming communities, I already advise those considering organic conversion not to take that step on the basis of the premium prices currently available in the marketplace: they should not found their business plans on those expectations. A substantial additional production base is already emerging to supply the marketplace, which must logically affect the prices that can be commanded for organic produce, even in a rising market. That is simply prudent advice.

I well understand why funds of this kind need to be released progressively over a period, rather than in one mad rush at the start; but that, arguably, cannot be applied

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to some of the other key schemes in the package. I am thinking particularly of training, marketing, and investment in processing and co-operative activity for development of the new farm-based enterprises. I shall say more about that later, in a local context.

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