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Ms Armstrong: Those businesses already qualify.

Mr. Jack: That may be so, but there will be grey areas. If I am wrong, I shall be the first to thank the Minister for clarifying the point. However, we have raised the matter in this debate because the framing of the Bill lacks clarity.

Mr. Evans: Does my right hon. Friend agree that, due to that confusion in the Bill, enormous discretion will be given to the people who will decide whether businesses qualify when the measure is enacted? There could be arguments--businesses could be allowed to benefit in one area, while in another area identical businesses might be excluded. That will lead to even more confusion.

Mr. Jack: I am grateful to my hon. Friend--my near neighbour in Ribble Valley--for that observation. He understands, from the many small villages in his constituency, what such questions could mean. If we are wrong, I shall be the first to thank the Minister for clarifying the matter. Perhaps the time is right to produce a simple, easy-to-read booklet of guidance on the whole subject. That might save the Minister's correspondence unit time, energy and effort--if nothing else--in replying to all our letters about who will be included and who will be out. I should certainly be grateful if some thought could be given to pulling together the various definitions of what is rural; sometimes, I struggle to find out whether parts of my constituency are included under various schemes.

I come to the wider context of the Bill. The National Farmers Union, in its representation to Members, rightly drew our attention to the anomaly that the Bill favours new, not existing, diversified businesses. If we are trying to safeguard the rural economy, that issue must be addressed. I support those hon. Members who have raised the five-year period and I am glad that the Government will review that carefully.

Much has been said about diversification of the rural economy and the fact that the activity of agriculture is suffering in that regard. The hon. Member for Crewe and Nantwich (Mrs. Dunwoody) is no longer in her place, but I want to qualify some of her remarks. The moaning has not come from the whole agricultural sector, nor is the whole sector subsidised. The poultry, pig and horticulture industries receive no direct subsidy, but they, too, are as interested in the measures as the subsidised sector.

The Library document rightly reminds us, under the heading "Factors limiting diversification", that:

One of the issues that we shall have to address--although perhaps not directly through the Bill--is from where new investment in agriculture will come. As hon. Members point out when they comment on the lack or decline of farm incomes during the past few years, the amount of new investment capital in agriculture is significantly limited.

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Table 6 of the English rural development plan--a weighty document--lays out some of the help that the Government purport to be able to give over the next seven years to enable rural Britain to take advantage of some of the provisions in the Bill. According to the table, investment in agricultural holdings in 2002 will, in effect, be only £1.5 million; in the following year, it will be £2.3 million. Those amounts are for the whole of British agriculture.

In 2002, there will be £6.3 million for the improved processing and marketing of agricultural products--the type of diversified activity that might receive assistance under clause 1; in 2003, the amount will be £8 million. In 2002, £1.8 million will be allocated for the encouragement of tourism; there will be £3.6 million in 2003.

When we hear talk of £1.6 billion over seven years, the English rural development plan sounds wonderful, but break it down into its constituent parts and we find a pretty thin diet--a limited amount of jam is being spread thinly through the rural economy to enable diversification to take place.

I conclude my remarks with an observation on another key barrier on which much work is needed. The rural White Paper produced by the previous Conservative Government addressed planning in the countryside. In fairness, the Labour Government have also done so. However, there is great feeling, especially among people who moved to rural Britain because they seek an idyllic life style, and opposition to substantial development. Development on farms will excite a large number of people.

It is clear that although planning guidance has been changed, we have not yet dealt with all the barriers to developments on farms. If genuinely new enterprises are to develop, there may be a lack of fit between the rural idyll and the needs of the farm. For example, access is one such issue. If an IT-based industry is developed within the curtilage of a farm, using redundant buildings, and 20 or 30 people use cars to go to those premises, one can imagine the concerns that will be expressed in villages.

I could continue, but such practical issues may act as a constraint on the type of diversification that the measure is supposed to address. I very much hope that when the election is out of the way, we shall return to a full, frank and public debate on and discussion of all these matters. It is important that we maximise the potential of the rural parts of the United Kingdom, just as we try to do in the urban context through inner-city regeneration. This is the equivalent challenge to inner-city regeneration; it just happens to be taking place in the countryside. The same difficult issues present themselves there as in urban Britain. Although I welcome the measure, it is but a small drop in what will be a big ocean when it comes to reviving the rural economy in this country.

7 pm

Mr. David Drew (Stroud): I am grateful to have the opportunity to contribute to the debate and apologise for not having being present for as much of it as I should have liked. Unfortunately, it clashed with an interesting scientific expose of bovine tuberculosis which is ever

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present in my constituency, and the next problem after foot and mouth. There is nothing new in our having to face up to animal diseases.

In our discussion on how businesses can be helped, we must get right the context within which they operate. The Bill is not an isolated measure; it is part of a raft of Government initiatives. Given that the Government are sometimes criticised for not knowing what is going on in rural Britain, or for not representing it, the hard and fast way in which they have introduced many different policies deserves close examination and hearty congratulations. The rural White Paper is an important document in its own right, and several initiatives have sprung from it. The Bill is not necessarily one of them, but we must start from the perspective that it is integral to it. The action plan for farming is central to the debate. Although we are not dealing with the immediate crisis, we are concerned about the way in which we can help farms and alternative businesses in rural Britain.

Some issues that I want to raise have already been mentioned; others remain to be highlighted. We must get the Bill right because businesses will need to understand it and call on the help that it offers. I welcome the Government's clarification of diversification as it relates to farming and other businesses in the rural economy. We need to build on that; we cannot wait for the market to make it happen. Intervention is necessary, and some of us want to see more of it. That policy can be delivered by direct Government support or by using the tax or rating system to encourage new businesses to set up, which hopefully will help existing businesses to flourish.

What I like so much about the Government's approach in the White Paper is that, rather than just talking about the need to help rural industry, they are providing it with resources. That was lacking in the previous Government's attempts. The Government are a decentralising Administration. They are giving resources to the first level of government--parishes and towns. Various schemes are under way, including the parish initiative for transport and the more effective use of resources to bring businesses into operation locally. In addition, we are starting to believe that we can lay down a minimum service provision. That links up with the Government's policy on retention and protection of rural sub-post offices. As I have said before, we need to bring that together and recognise how crucial transport is to rural Britain. We must provide genuine alternatives to the car so that people can get about if they cannot or do not want to drive.

I welcome the recognition of the important role played by tenant farmers in the rural economy and the difficulties that they face. We must give them particular help. Clearly, that has to relate to the nature of their tenancies. We also have to consider how we can encourage them and give them the wherewithal to diversify so that they can run other businesses alongside their farming activities. I hope that, as it develops, the Small Business Service will play a major part in that by giving advice and financial help. The countryside group, which was set up by the Gloucestershire development agency, is beginning to have an important intermediary role. It is helping to use the rural development regulations to find money that can be invested in different ways. Not only does that work at a county level, but it could be successful as part of a more decentralised structure. I believe that the organisation will take on other roles.

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My only criticism of the Government is in relation to their approach to early retirement. That nettle will have to grasped, as I have said openly before. I welcome the gradual movement towards that. I understand the concern of my right hon. Friend the Minister of Agriculture, Fisheries and Food about pumping money into supporting dead weight--I do not use that term pejoratively, but in an economic sense. I realise that it would be better to front-end the money and ensure that it is provided effectively. However, an industry with an average age of 58 does not have the best future ahead of it. We must do something about that.

The Bill is part of a cohesive policy. We should not separate different aspects of that. As the official Opposition said, there is a danger of setting business against business if we do not handle the problem sensitively and sensibly. I hope that the Bill will help us to consider how we can keep shops in operation. They need to be able to source locally and get supplies from local abattoirs. Perhaps greater economies of scale will allow them to keep the sub-post office going. That could be achieved as part of the ratings system. Those are the very costs that businesses want to reduce and I am sure that we can help them to do that.

We are working through the problems created by the difficulties of the foot and mouth crisis. However, we must move beyond the specific help that is being offered and consider a cohesive way in which we can rebuild the food chain and offer services that do not rely purely on subsidy. Those businesses need to function in their communities in the long term so that people are willing and able to buy into them. It is important that they have a future, not only for the local communities, but, of course, for the people who run them.

I am always depressed by the fact that when the official Opposition have to find money for rural regeneration--whether it be additional help for rate relief or grants--their answer is to get it by the emasculation of the regional development agencies. I say categorically that if they want a complete vote loser in my constituency, that is it. The regional development agency is pumping in £90 million to overcome the decline of one key industry in Dursley in my constituency. [Interruption.] Conservative Members may laugh, but they should bear that fact in mind when the official Conservative candidate tries to defend their policy. They must understand that the local rural economy is dependent on the regeneration of that site and it will be greatly damaged if we get rid of the RDA without giving it a second thought. There is a total misunderstanding of the relationship between small communities in isolated rural areas and the market towns on which they depend. The whole point of RDAs is that they provide seedcorn investment to market towns, which creates employment for people in surrounding villages. Getting rid of the RDAs would be vandalism. They are supported not only by Labour Members but by businesses and communities who see the investment that they make. I hope that the official Opposition will reconsider, even at this late stage, their decision to find the money that they need by abolishing the RDAs.

I have become increasingly aware of how foot and mouth disease directly affects local authorities, which have a key role to play, because, as many hon. Members have said, they know the problems experienced by businesses and communities in their area. Even if we provide help from the centre, largely through mandatory

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rate relief, local authorities have to be allowed a certain amount of discretion. That is the right approach, but we must not leave it to local authorities to find all the funds because that will cause them difficulty.

On Friday, I will meet the officers of my local authority to talk about the implications of its funding relief for businesses suffering in the foot and mouth crisis. I am sure that central Government will be able to find methods of making additional finance available, but unless we put together a comprehensive package for the rural economy, and not only for the foot and mouth crisis, local authorities will be in a difficult position. It has been said many times that that can only result in higher council tax charges and, potentially, a conflict between methods of raising money and of spending it. We must work with local authorities in rural areas to put in place a funding stream that works properly.

We must also consider how we value property and lock in place rate support. I know that the notes accompanying the Bill are merely explanatory, but they say that there is not expected to be much call for rate revaluation tribunals. A clear way to provide substantive help would be to reduce rateable values when businesses--particularly, but not exclusively, in rural areas--get into trouble. My experience is that it may be a long time before a tribunal hears an appeal, and if a business was in difficulty, a reduction in the rateable value could make a substantial difference. This is a question not only of resources but of people, and we need to involve them so that tribunals can be held as soon as possible.

I welcome the Bill, which shows that the Government are in tune with the help that is needed by our rural economy. Individual businesses are crucial to that economy. We need to keep shops and small firms operating, and the Bill will help us to do so. Clearly, it will be subject to further improvement. When the Government are re-elected, they should build on community regeneration, which is also crucial. With that in mind, I am sure that we will send the Bill on its way, having improved it, and put in place the rural support that is needed.

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