Previous SectionIndexHome Page

Mr. Brown: I do not want to overburden all these excellent schemes with administrative costs and I will be taking a hard look at those. However, we must ensure that the schemes are being implemented properly and that they represent good value for money. I do not propose the expenditure of the same figure year on year. The hon. Gentleman is the Chairman of the Select Committee on Agriculture and I know that he fully understands that the European moneys effectively come on a flat profile--the same sum, with some small allowance for inflation, each year. The expenditure in my Department is profiled similarly and is, in any event, subject to the normal public spending rounds. The two new figures--the sums modulated and the match funding that accompanies the modulation--are on a rising profile. The schemes will therefore steadily expand over the period. It is my intention to publish an explanatory booklet setting all that out, with the indicative figures, so that everyone can see the rising profile of expenditure year on year.

The hon. Gentleman asked about the countryside stewardship scheme. Farmers are enthusiastic about the schemes and, as I know that he understands, they are oversubscribed. Today's statement is significant for two reasons. It provides new money in an intelligent way that supports farm businesses without coupling the payments to production and, every bit as significant, it points the way forward for reform of the CAP.

Mr. John McFall (Dumbarton): I assure my right hon. Friend that the offer of new money will go down well with Scottish farmers. Will match funding be available to Scottish farmers and will it be ring-fenced so that it is spent entirely on agriculture?

Mr. Brown: The schemes are shaped in such a way that they are almost entirely focused on farm-based businesses. The money that will be spent in Scotland is ring-fenced for Scotland. Of course, the expenditure heads are devolved now to the Scottish Executive and the Scottish Parliament, but every pound modulated in Scotland will be matched by a further pound from the UK Exchequer. That must be welcome news for farmers in Scotland, as it will be throughout the United Kingdom.

Mr. Tom King (Bridgwater): Is the right hon. Gentleman aware that the more he seeks to make the figures sound very big by adding together seven years of expenditure, the more I form the impression that the figures are probably not as big as he would like some of his hon. Friends to believe? In view of the catastrophic

7 Dec 1999 : Column 707

situation of so many in the farming industry, what is the right hon. Gentleman's best estimate of new money for year 1?

Mr. Brown: I intend to publish the figures rather than give an estimate. I am trying to explain to the House that the profile rises over the period as a result of the way in which modulation works. The total sums, including the modulated amounts and the match funding, represent over the period a 60 per cent. increase on what would have been spent had we not made use of modulation and match funding. The amount that we will spend at the end of the period compared with the amount at the beginning of the period represents a more than doubling of current expenditure.

Mr. Paul Marsden (Shrewsbury and Atcham): I know that struggling farmers in Shropshire will warmly welcome the announcement. I congratulate my right hon. Friend the Minister on all his endeavours in the past few months. I welcome the new money for organic conversion. Will he reaffirm the Government's long-term commitment to improving the lot of organic farmers and making money more widely available for conversion?

Mr. Brown: I am grateful to my hon. Friend for welcoming the extra sums that we intend to spend on the organic farm conversion scheme. Although I have given the House the total figure, my hon. Friend will realise that it will cover more organic farmers as the scheme develops. As it is a conversion scheme, as farmers leave the scheme, new farmers will be able to come in so the impact will be bigger than the figures might at first sight suggest.

Rev. Ian Paisley (North Antrim): The Minister is well aware of the state of the farming industry in Northern Ireland, and he knows that any money, especially new money, is invaluable to farming. The Minister said:

Does that mean that money will immediately cease being paid to farmers who are currently receiving it? That has caused an uproar this afternoon in my country. As the Minister knows, I now have some responsibilities as Chairman of the Northern Ireland Committee on Agriculture and Rural Development. There are serious fears that the farmers who are in most need of money will have money removed from them in the short term as a result of the announcement today.

Mr. Brown: I welcome the hon. Gentleman to his new responsibilities.

I understand what the hon. Gentleman says. Every pound modulated in Northern Ireland will be spent in Northern Ireland and will be matched by an extra pound from the United Kingdom Treasury. In other words, it is impossible for farming, collectively, in the Province to lose out under the scheme. That is the crucial point. How the money is to be spent on schemes or allocated between different interests in the farm sector in Northern Ireland is now a devolved matter, in which I know that the hon. Gentleman will take a particular interest.

Mr. Peter Bradley (The Wrekin): Has my right hon. Friend noticed the glum faces among Opposition Members,

7 Dec 1999 : Column 708

who have become used to exploiting the hardship in which farmers have recently found themselves? I very much welcome my right hon. Friend's announcement and his personal efforts--as well as those of his team--in securing greater investment from Europe. The statement and the new set of arrangements will help farmers to see beyond the immediate crisis to the future; it will give them the opportunity to take part in that future. Will my right hon. Friend pass a message to the regional development agencies about the role that they can play in rewarding and promoting entrepreneurship in the rural economy?

Mr. Brown: My hon. Friend is on to the right point. In my statement, I indicated the way forward and I want to involve the regional partners fully in what is being done. We are trying to show the way forward for rural farm businesses and to provide supports that are decoupled from production. The scheme is funded partly through modulation, but it attracts match funding from the Treasury. It is impossible for any region not to be a beneficiary of the announcement.

Mr. Peter Atkinson (Hexham): Many Opposition Members would welcome the scheme if we could properly understand it. The difficulty is that modulation of direct grants means a cut in direct grants and a recycling of that money to other pockets. That is not new money. Will the Minister help me and Britain's farmers by telling us how much new money will go into the scheme, either in year 1 or year 7? Just give us a figure.

Mr. Brown: The sums that are being modulated rise over the period. At the end of the scheme, we estimate that the sum being spent will be £100 million in England. That will be matched by £100 million of new money. It will be a rising profile of expenditure over the period. In the final year, 2006-07, the outturn will be £295 million, which is an extremely large sum of money.

Mr. Mark Todd (South Derbyshire): I join colleagues in welcoming the statement, but want to draw attention to the concerns that have been expressed about the delivery of the schemes. First, it is important that they should be integrated with other farm-targeted business assistance run by other Departments and also with the work of the regional development agencies.

Secondly, I share the concern that early retirement schemes have been firmly banged on the head. I am aware that several farmers in my area would welcome some way of moving out of the farm sector, and had thought that the scheme might provide a route. Thirdly, will my right hon. Friend give some indication of the balance of opinion on the means of modulation in the consultation exercise? From the parts of the process that I have seen, my impression is that there was a strong feeling that larger farmers and greater beneficiaries of aid schemes should suffer more than smaller farmers from any modulation.

Mr. Brown: In response to the consultation exercise, a numerical majority of farmers in England--I was responsible only for the consultation in England--were in favour of modulation in principle. The farming unions are cautious about modulation and have made two points to me: they want to know how the fruits of modulation will be spent and they want an assurance that the money will

7 Dec 1999 : Column 709

be spent on farm businesses, or matters of importance to such businesses. I can give the House that assurance today.

The National Farmers Union has made it very clear to me that it would consider modulation to be reasonable only if it were a lever for match funding. I can give the House the assurance that, for every pound modulated, there is another pound from the Exchequer, so this is match funding and new money.

I accept what my hon. Friend says about the early retirement scheme. I have tried very hard to make it work, but we cannot do so in a way that would represent value for money, so it is better to say, candidly, that there will be no such scheme.

Next Section

IndexHome Page