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8.18 pm

The Parliamentary Under-Secretary of State for the Environment, Transport and the Regions (Mr. Robert Ainsworth): I am pleased to respond to the debate. Over the weekend, I contracted some sort of germ and I sound like a tractor that needs its tappets adjusting. I apologise for that, but I hope that I can make myself understood.

It has been acknowledged during the debate, albeit grudgingly by some Opposition Members, that the new rate reliefs for which the Bill provides will help farmers and village communities. The measure fulfils commitments that we made in the action plan for farming, the local government finance Green Paper and the rural White Paper. Farmers who wish to diversify will pay less to set up new, non-agricultural businesses, and more help will be given to village businesses to provide essential services to the community.

The National Farmers Union and other rural bodies have welcomed our proposals for farm diversification, and a wide range of respondents to the local government finance Green Paper welcomed our proposals for extending village shop rate relief. The Country Land and Business Association has welcomed the Bill; it has written to my right hon. Friend the Minister to urge its implementation as quickly as possible.

Many hon. Members have contributed to the debate. I apologise in advance in case I do not pick up all hon. Members' points. If I miss any and hon. Members raise them with me later, I shall ensure that they receive a response. I shall do my best to respond to as many points as possible now.

In what he described as his swan-song, my hon. Friend the Member for Leominster (Mr. Temple-Morris) spoke knowledgeably about his constituency and also about wider issues of policy. He said what a good time he and his constituents had had under the present Government. I hope that when he considers what a good time he has had under the present Government, he will not forget what a wonderful regional Whip he had for most of that time.

My hon. Friend the Member for Falmouth and Camborne (Ms Atherton) welcomed the Bill, but asked--as did my hon. Friend the Member for Stroud (Mr. Drew)--for it to be part of a more comprehensive review. Indeed, both recognised that the Bill constituted only a small element of a more comprehensive programme.

A procession of Opposition Members suggested that the Bill did not do this, that or the other. In fact, the Bill introduces two measures, in response not to foot and mouth but to the rural White Paper. In an intervention,

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the hon. Member for Banbury (Mr. Baldry) suggested that our proposals had been plucked off the shelf and presented at the last minute. If he had read the White Paper--as we would expect him to, as a Member representing a rural community--he would have seen the proposals on pages 25, 89, 96 and 97. I commend the document to him and hope that, even at this late stage, he will read it.

My hon. Friend the Member for Falmouth and Camborne and several others asked about the definition relating to food stores. They asked whether, if hot food--not surprisingly, my hon. Friend mentioned pasties--was served as a secondary operation, relief would be ruled out. The store's main business must be the provision of food: if hot food is provided as a side activity, it will not be ruled out.

The hon. Member for North Wiltshire (Mr. Gray) got into a bit of a tangle in regard to hereditaments. In terms of rating law, a hereditament is any unit of property that is subject to business rates. References to hereditaments in the Bill mean that all farm premises that are currently exempt from business rates which would immediately become liable under present legislation in the event of diversification will receive relief under the Bill. The issues raised by the hon. Gentleman about inheritance have nothing to do with the Bill, and he need not worry on that score.

Mr. Gray: The Minister makes an interesting point. He might like to have a word with the House of Commons Library, which has given me a four-page extract that is all about hereditaments. I still cannot pronounce that word as well as the Minister, despite his flu. Every single definition suggests that a hereditament must be capable of being inherited if its holder dies. At no stage does the extract say what the Minister has just said.

Mr. Ainsworth: If the hon. Gentleman will not be reassured by me, we may have to engage in lengthy correspondence, which will bore both him and me.

Along with others, the right hon. Member for Fylde (Mr. Jack) raised the issue of definitions of a rural area. Discretionary relief is available to all businesses, but the special grant is being made available to local authorities that are looking after completely rural areas. Given that the problems experienced by the rural community have a specific and greater impact on totally rural areas, 151 local authorities have been defined as needing additional assistance. There is nothing to stop local authorities that straddle rural and urban or rural and suburban areas giving rate relief to businesses in difficulty; central Government pick up most of that in any case. It was felt, however, that additional help was needed for local authorities representing remote and totally rural areas because of the disproportionate impact on them. That is the only reason and, as I have said, it does not prevent other businesses from being eligible.

The right hon. Gentleman asked about the population limit of 3,000, and wanted to know how it would work over time. A limit must be drawn somewhere, and the measures we propose are designed to maintain the viability of small rural areas. It is for local authorities to keep registers detailing which settlements in their areas contain more or fewer than 3,000, and which will or will not be eligible for relief on that basis.

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The hon. Member for North Wiltshire mentioned stud farms and other horse interests. He will know that stud farms already benefit from reduced rates: they all receive a reduction of £2,500 in their rateable values, currently worth a maximum of £1,075 off their rate bills. We propose to increase the reduction to £3,000 to bring it into line with the maximum mandatory relief for new farm enterprises, which is worth £1,290 off the rate bills of all stud farms. The Bill will extend the discretionary top-up relief for the farm diversification scheme to new stud farms on the terms that apply to other farm businesses.

Several Opposition Members, including Front Benchers, mentioned the apparent rate relief anomalies arising from the exemption of agricultural land from business rates. I should point out that those anomalies have existed for a long time; indeed, they existed throughout the 18 years for which the Conservatives were in power. Opposition is a wonderful way of becoming enlightened, and Opposition Members seem now to have discovered the existence of those anomalies, which they have described as disgraceful. I simply remind them that they did nothing about them when they were in government, and that they did nothing because the anomalies are greatly complicated and difficult to remove. Any attempt to redefine agriculture to remove those anomalies would have to be very carefully thought out, or even greater anomalies could be created.

The hon. Member for Somerton and Frome (Mr. Heath) said that those who are not in designated areas could be excluded from the relief scheme. However, I think that I have already addressed that issue. He also said that he believes that there should be fundamental reform of the rate system. In last year's local government Green Paper, we consulted on that issue and proposed a rate relief scheme for all small businesses. Although there will have to be continuing discussion on the issue, any attempt to address it will, as I said, give rise to various anomalies.

The hon. Member for Somerton and Frome also asked about the need for primary legislation to provide relief for shops--whereas such legislation was not necessary to provide relief for garages and pubs--but he seemed unable to understand the answer I gave him. I tried to answer the question as clearly as I could, and it is very difficult if he cannot or will not understand what I say. However, the issue is very simple. The original legislation refers specifically to sole general food businesses, and that provision cannot be modified without further primary legislation. Such a situation did not pertain in the legislation on garages and public houses.

Opposition Members have said that the Bill does not tackle the problems and issues facing rural Britain. However, we have consulted on our proposals and said that we would introduce them at the earliest possible opportunity. We are doing so. Consultation ended on the same day that the Bill was presented to Parliament, and--with the co-operation of the Opposition--we now have a parliamentary opportunity to implement those proposals. We should take that opportunity.

No one is trying to suggest that our proposals are the answer to every question. Nevertheless, Opposition Members should recognise that, since 1997, the Government have taken various action to provide financial assistance to farmers. The fact is that £1.35 billion has been injected into the sector, including about £785 million in agrimonetary compensation and annual supplements of about £3 billion in direct common

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agricultural policy payments to United Kingdom farmers. Several initiatives introduced in early 1998 were worth more than £150 million, including £85 million of agrimonetary compensation. In November 1998, a further £120 million aid package was introduced.

All of those actions were taken before our current efforts to deal with the current difficulties caused by foot and mouth. Opposition Members who say that the Bill is a response only to the current difficulties are deliberately ignoring our long record on providing assistance to the sector.

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