| Previous Section | Index | Home Page |
Mr. Keetch : Importantly, the Minister distinguished between small growers and commercial growers. As time is short tonight, will he give a commitment that he or his noble Friend Lord Whitty will meet a delegation of small growers from my constituency and from the constituencies of my hon. Friend the Member for Somerton and Frome (Mr. Heath) and other Members in the Chamber tonight, as they would like to present their case directly to Ministers?
Alun Michael: There has been confusion and misunderstanding, so I am happy to try to clarify the issue with the hon. Gentleman and his hon. Friends, and we can ask others who have more expertise than me to go into the fine detail.
The underlying themes of our debate were twofold. First, there was a request for subsidies and, secondly, there was concern that perverse incentives could damage biodiversity. I hope that I have shown that the perceived perverse incentive is much less serious than has been suggested. The key feature of the CAP reform settlement is the decoupling of support from production. Existing support for farmers is redirected to encourage them to make the best use of market opportunities. Fruit growing has not benefited from the CAP subsidies that are to be replaced by the single payment. Fruit trees have been planted because there was a market demand for the fruit, not because of subsidies. It is entirely consistent with that philosophy that trees that are no longer needed for commercial production should be grubbed up if there is a more commercial use for the land. In the end, the area used for cider production must reflect the market demand for cider apples and the most commercially appropriate methods of growing them.
On biodiversity, we must reinforce the point about the lack of incentive to grub up and must counter what has been said. If a grower has been cultivating apples and
20 Apr 2004 : Column 274
not claiming on a piece of land, grubbing up will entitle him only to the flat rate element of the single payment, often called the single farm payment. That rate is just over £20 a hectare in the first year, 2005, which is far below both the £340 quoted in the press and media and the £230 area payment, which takes eight years to reach, as the flat rate element in the new payment system builds up through the traditional route. That is without taking into account the cost of grubbing up, and I acknowledge the expenditure mentioned by the hon. Member for Somerton and Frome. The National Farmers Union has put it at about £300 a hectare, although it could be much higher in different circumstances.
Mr. Heath: I do not want the right hon. Gentleman to mislead himself, as it were, about the perverse incentive. No one in my part of the world believed the incorrect figure that he cited, and they understand perfectly well the rates, the gradual increase and the effective ceiling. What worries them is that that is an important factor in the profitability of their land, and that the capital value of their land is massively reduced if it is not included in the eligibility criteria.
Alun Michael: A number of complex issues are tied together. One is the possibility of entering into the IACS arrangement—the integrated administration and control scheme—which obtains up to this year. That was inflexible, so there is a change in the arrangements. As I have indicated, there are various other ways in which eligibility can be considered—for example, the issue of trading. There are several complex issues that open a number of doors that are not as closed as has been implied.
On the key point that the hon. Gentleman made at the start of his contribution, it is important to understand that some orchards—long-established traditional orchards in particular—provide considerable environmental benefits. That is why there is a real incentive to retain them. Those benefits are recognised in the countryside stewardship scheme, which provides payments of about £250 per hectare for maintenance of traditional orchards. That is much higher than the full rate that would be applicable under the new system, and more than the full rate of single payment. Two thirds of the total area of traditional orchards is already protected in this way, through 1,500 agreements, at an annual cost of £600,000. Payment rates for one-off activities such as pruning have been increased by 55 per cent.
It is open to other growers to come into the stewardship scheme during the annual window. Although the hon. Gentleman is right to say that the window has closed for this year, the window will be there next year, although there will be changes in the scheme, so the opportunity to go into stewardship, which offers much greater rewards than the single payment option, will be available in relation to places where the biodiversity value, which he put at the heart of his comments, is the real issue.
Andrew George (St. Ives) (LD):
Does the Minister accept that where the Department is seeking to intervene to put right possible unintended consequences in severely disadvantaged areas—I understand the
20 Apr 2004 : Column 275
Department is prepared to do that—notwithstanding country stewardship, there is still the potential for unintended consequences at the end of the transitional period in 2012? Surely the Minister must recognise that he should investigate the possible impact of that and consider revisions to take into account the needs of traditional orchards.
Alun Michael: I am trying to explain that there can be a perverse incentive— and therefore the grubbing up of orchards—only if those taking such a decision have totally misunderstood the options available to them. I understand the importance of certainty, which the hon. Gentleman is referring to and which the hon. Member for Somerton and Frome mentioned in his speech. It is true that there are CAP reform decisions that are still to be made.
We cannot realistically expect to reopen the question of permanent crops in the near future. We can, however, take account of the need to protect orchards in planning to implement the single payment scheme. We have been speaking to the National Farmers Union about that. We recognise the need for growers to know what the rules will be, and we will take this into account in the planning announcements—for instance, on the 10-month rule, which determines when land used to support a claim must be at the farmer's disposal. We are also considering the NFU's suggestions about the possible use of the national reserve in certain situations.
20 Apr 2004 : Column 276
Finally, we recognise that some old orchards are used for grazing and that this has been taken into account in the existing IACS rules. It would be perverse to create a discrepancy between the current arrangements and the new ones. We are seeking to ensure that the treatment of land under the single payment rules reflects the same considerations.
We believe that the fears of wholesale orchard grubbing have been exaggerated and would come about only if there was misunderstanding about the options available. We recognise the need for clarity about new rules and are working to resolve the outstanding issues. Countryside stewardship provides an important and successful means of protecting traditional orchards, and we need to consider that as the solution to some of the problems that the hon. Member for Somerton and Frome placed at the heart of his contribution. We should not forget the outstanding achievement that CAP reform represents, moving away from production-related subsidy to production for the market and payment for public good, including biodiversity, the very issue that the hon. Gentleman rightly said was at the heart of the Government's policies, as it was at the heart of his plea in relation to traditional orchards. We recognise, as he does, the contribution that they make to biodiversity.
Question put and agreed to.
- Adjourned accordingly at half-past Eight o'clock.
| Index | Home Page |