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Mrs. Browning: They are not in my constituency.
Margaret Beckett: I am sorry that they are not in the hon. Lady's constituency. Unfortunately, we are not able to allocate subsidy per constituency. We have already got a lot of analysis and we will continue to do more. I am sure that everyone else will also analyse the proposals in detail, and that will illuminate the exact position for all of us. In overall terms, there will be winners and losers, as always happens when things change, but the impact of the movement of resources is anticipated to be about 13 to 15 per cent. over eight years. We will then have a system of support that is much more defensible, and that will be worth it.
Mr. Michael Wills (North Swindon) (Lab): I congratulate my right hon. Friend on a skilful and historic statement. I also lend my support to those who have asked her to continue to explore how best that huge public subsidy can be used to support those who actually work the land, rather than simply to inflate the asset value of land. Now that subsidy has been decoupled from production, will it mean an end to export subsidies under the CAP, which have been so damaging to so many of the world's poorest people?
Margaret Beckett: I am grateful to my hon. Friend for his welcome, and I am especially grateful to him for taking that point on board. I know that he has been
greatly concerned about the distorting effect of export subsidies and has expressed his anxieties about the form of reforms hitherto. He is right: what created the need for export subsidies was the overproduction for the European market. There will be no incentive for overproduction any more, so the need for export subsidies should wither on the vine. If my hon. Friend can get that message across to some of the well-meaning and honourable people who campaign against this reform, I would be grateful to him.
Mr. John Burnett (Torridge and West Devon) (LD): Complex rules will be necessary to calculate the payments made in the transitional period, and especially to fix the base historical payment—although admittedly that will be phased out. Can the Secretary of State confirm that there will be a fair, independent and objective appeals system, so that individual farmers can appeal against determinations made by her Department?
Margaret Beckett: My understanding is that farmers in the hon. Gentleman's area will do rather well out of the changes. However, some will feel, for a variety of detailed reasons, that they will be disadvantaged. I urge all hon. Members to tell their farming constituents to provide us with as much information as they can as soon as possible, because the more information we have, and the more accurate it is, the less the likelihood of errors. Information will also assist us when we consider how great a provision we need to make for a national reserve. Part of the purpose of such a reserve will be to deal with anomalies that cannot be dealt with any other way, with hardship cases, and with unusual circumstances—perhaps land or leases changing hands in the reference period. [Hon. Members: "Appeals?"] Yes, there will be an appeals system to correct the basis of payment, but just as important is a system that deals with harmful anomalies even if the payment has been assessed correctly.
Mr. John Grogan (Selby) (Lab): Does my right hon. Friend accept that today's announcement will be particularly welcomed by the completely unsubsidised horticultural sector? Indeed, the NFU horticultural committee, under the able chairmanship of my constituent, Mr. Graham Ward, has argued long and hard that if the historic payment system had been adopted it would have created market distortions in that highly successful sector.
Margaret Beckett: I am grateful to my hon. Friend. He is right, although it is important to utter the caveat that it will not be open to people to expand the areas of enterprise that they have previously had and claim extra payment on that basis. The arrangements will be for existing areas, with some exclusions for top fruit. Generally speaking, however, he is right to say that the changes will be helpful to horticulture. Many in that sector have made the grade in an unsupported market, but the changes will make a difference for some.
Mr. John Maples (Stratford-on-Avon) (Con): Will one of the effects of the changes that the Secretary of State has announced be that a dairy farmer who currently receives a lot of subsidy but probably does not
make any money will gradually have much of that subsidy taken away and given to farmers who currently farm profitably without any subsidy?
Margaret Beckett: There will be impacts on dairy farmers, as on everyone else. At present the dairy sector receives direct support, but we are about to move towards a system with a dairy premium. It is our proposal to decouple that premium from the beginning, and to make that part of the general approach. However, there will be winners and losers in the dairy sector, as in other sectors, and we are willing to examine the redistributive effects and see what can be done to mitigate them. In the long term, a simple system such as we propose will be to everyone's advantage.
Mr. Peter Luff (Mid-Worcestershire) (Con): I invite the Secretary of State to say a little more about the impact on horticulture. She will know that the high-quality agricultural land in areas such as south Worcestershire and the Vale of Evesham can just as easily be used to grow subsidised cereals as unsubsidised field crops such as salad onions. Can she reassure horticulturists that they will not suffer an adverse competition effect as the high subsidies paid for arable crops such as cereals have an impact on the marketplace in the transitional period?
Margaret Beckett: I cannot say that there will be no effect in the transitional period, although I shall think some more about the point that the hon. Gentleman makes. In the longer term, payment will be made on the same basis for everyone. I know that those with unsupported crops were anxious that those who received support would be able to compete, with the assistance of that payment, against those who had never been entitled to a payment. That fear cannot be totally removed in the short term, but it should be diminished.
Mr. Andrew Robathan (Blaby) (Con): I declare a very real interest, as a farmer. The changes are a sensible step in the right direction and, as the hon. Member for Luton, North (Mr. Hopkins) said, signal the end for the CAP. Presumably the money paid under the flat rate will eventually be paid straight to the landowner. Many of my local farmers are council tenant farmers, the landlord being Leicestershire county council. How does she envisage the changes affecting the relationship between the landlord and tenant, especially in starter farms, which many people still want to take on? The proposals need fleshing out.
Margaret Beckett: I am grateful to the hon. Gentleman for his welcome. I am conscious of the fact that tenant farmers are anxious about whether some council starter farms will continue to be made available. We are looking at the issue in general terms and seeing whether we can do more to assist. I can tell the hon. Gentleman that the payment will go to the person who is farming the land.
Mr. Adrian Flook (Taunton) (Con): The Secretary of State said that Exmoor was a probable winner under this system, and I welcome that, but as I also represent other parts of Somerset, I cannot welcome the implications of her comments. Perhaps there is one
silver lining—less bureaucracy, as she described it. I accept that the system is not hybrid, but the transition appears to be so. What assurances can she give that there will not be an explosion of associated regulations and bureaucracy as we move towards 2013?
Margaret Beckett: The hon. Gentleman is right: it is not a hybrid system and ultimately it will undoubtedly be less bureaucratic. But there is a transitional period, and the same invidious choice is before the House as was before the Government—between a much more compressed transition period, with a bigger impact on farm incomes and farm planning, or an extended period that would lead to greater complexity. I regret the need to make such an invidious choice, but we had to make it and on balance, given that people will understand clearly what the pattern of transition is, it will assist them in planning for the longer term.
Mr. Roger Williams (Brecon and Radnorshire) (LD): Many farmers will be very pleased that they now have some information on which to make planning decisions—although the devil will be in the detail. But perhaps the Secretary of State should give us some background on her decision to split England into severely disadvantaged areas and the rest. If she is serious about supporting the most vulnerable farming businesses and those that make the biggest contribution to the environment, will she be putting more resources into severely disadvantaged areas, or doing the opposite?
Margaret Beckett: I am not planning to put more resources into farming through the CAP than currently exist, but we do intend to try to make better use of the resources over time. One of the best ways to do that is by reducing bureaucracy and moving to a more simplified system. The less we have to absorb, the better.
The reason for the split is simple and straightforward: otherwise, the redistributive impact would have been enormous, and many questions and concerns would have been raised. So we considered an explicit split between less favoured areas and others, and as I understand it, the impact is minimal, except in the beef sector. As we examined this issue, it became increasingly clear that that was the best possible way to mitigate. The structure already exists—the map of SDAs was last published in 1992, so everybody knows where they stand—and it seemed the best and simplest method. It was precisely because of our wish to avoid additional regulation and bureaucracy that we did not impose some other complicated system in order to mitigate, but went instead for a split between SDAs and non-SDAs.
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