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I secured this debate to try to point out some of the problems that diversification has caused and could cause in future. We have found it difficult in west Somerset and Bridgwater and the problem is that we have diversified for 10 years. We have done everything that successive Governments have wanted us to do to try to diversify out of the core business, which is straightforward farming. We have gone almost as far as we can go. We have created bed and breakfasts, little companies doing all sorts of things and opportunities across the region. That applies not just in Somerset, but throughout the south-west. Our problem is that we are hitting the stage where we can go no further.
For example, in the levels, which is the largest non-flooded area in the south-west and perhaps in Britain, we are dependent on the ability to diversify. People cannot make a living any more out of what is there; they cannot get the value for the beef or lamb, or whatever. However, they cannot plough the levels, either, because it is not that sort of soil. The people in that area have pushed out as far as they can. If only hon. Members could see what they have achieved in such areas; it is quite remarkable and the Minister knows that. However, those people are subject to the whim of nature every year. At the moment we have very little rain, but that may not be so in future.
Another example, which the House knows well, is Yeo Valley organic yoghurt. We eat those yoghurts, which are sold in the Palace. That company started because a farmer had too much milk and it is now the biggest producer of organic yoghurt in the United Kingdom. It has done brilliantly well and continues to expand.
Those are two extremes, but the truth is somewhere in between. Now, with the headage and area payments system, we could have a situation where farmers themselves cannot farm or diversify because they are not seen as farmers, but people who play-farm. That is the crudest way that I can describe it, but in other words they are not seen as people who are farming for a living. The Minister is aware that we are having a clawback over a period until those two systems become one.
Europe is definite about what people can and cannot do. I like to think that the Minister would, for the future of the Government, look favourably on how we can diversify and continue to do so. However, we need Government help. If we do not get the help, it will be harder to push forward. For example, on the junctions at Bridgwaterwe have twoMr. Derek Mead wants to build a cattle market. There is nothing wrong with that; it would be an agricultural centre. Mr. Mead is and has been a successful farmer.
At the moment we cannot build that market because the regional development agency is tinkering with other sites, which is fair enough, because it has to get the best value. However, farmers are depending on that, because they have lost the markets in Taunton and Bridgwater
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and although the markets in Burnham-on-Sea and Highbridge are still going, people there want to retire. We could end up without a market. Surely that is the sort of thing that we should do, and I hope that the Minister agrees.
To give some idea of the diversification of the market, it hopes to do a deal with Bridgwater college to bring further education into a market. Bridgwater college has just taken over the agricultural college outside Bridgwater. That is diversification at almost its highest level, where everyone is working together.
The issue affects not just the Somerset area but places further afield. The Western Morning News published a letter by a Jim Hosking, who runsI will have to try to pronounce itFentongollan farm, near Truro. The Minister, as a Welshman, has a better chance of pronouncing that correctly than I, a Scotsman. On decoupling and cross-compliance, Jim Hosking says that one matter that has really come to haunt us is the potential ability of the Secretary of State to order farmers and farm people whether to go on and harvest or not. That brings up all sorts of problems for diversification. On the levels and hillsand, obviously, outside Truropeople require the flexibility to farm. The Minister is fully aware of that.
I have never met Mr. Jim Hosking; I merely thought that his published letter was very good. When we get such people asking why one cannot go within 20 m of the gate and so on, we know that we are potentially preventing people from doing their job. What I have mentioned may not be diversification exactly, but it is part of what we are trying to do, which is to diversify and push the envelope.
There are various recommendations that I will write to the Minister about, if I may, because of time constraints; this is a short debate. In conclusion, the Minister knows the arguments. The last one that I shall put to him is the argument on the dreaded H-word. The Minister knows that we need help on Exmoor and so on. He has been very kind, and has held an enormous number of discussions with my hon. Friend the Member for Taunton (Mr. Flook), the hon. Member for North Devon (Nick Harvey) and me on how we can look forward. That is an area in which we know that there has been diversification, and there will be changes over the next year.
Mr. Deputy Speaker : Order. May I help the hon. Gentleman? He said that this was a short debate; it is a half-hour debate, and we do not need to conclude it until quarter to 5, so if he wishes to raise other matters that he was thinking of cutting out, I am sure that the Minister will not mind.
Mr. Liddell-Grainger : I thank you for that guidance, Mr. Deputy Speaker; as usual, you have cut me to the quick. I think that the Minister and I are trying to move on to certain subjects. That is the way that I would like to play it, if I may.
The Minister is fully aware of the situation on Exmoor. I am not sure that he can give a full answer at the moment, but would he consider that he knows the fundamental changes that will be made? We need to look forward. Diversification is an evolution, not a
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requirement, but we have to evolve; we have no choice in the matter. If we do not, there will be no farmland and countryside where we currently see itin the levels, Exmoor, Dartmoor, Bodmin, Truro, or whereverbecause the farmers will not be farming. There will be more and more people coming from London, selling houses and play-farming. I hope that that will not be the case. Could the Minister give reassurance to places such as the south-west that diversification has the backing and help of Government? That will give an enormous feeling of goodness.
The Minister for Rural Affairs and Local Environmental Quality (Alun Michael) : I thank the hon. Member for Bridgwater (Mr. Liddell-Grainger), who instigated the debate, for introducing it with clarity and brevity. In doing so he signalled a number of serious issues that I know he wishes to pursue. I should say, Mr. Deputy Speaker, that I think that the hon. Gentleman is being very kind in constraining himself, knowing the pressures on other ministerial engagements today. I thank him for that and give the assurance that I will perhaps respond to him at greater length, and will, if necessary, meet him to discuss one or two of the issues that arose from his speech.
I respect the hon. Gentleman's advocacy of his constituency and the way that diversification is being pursued there. I am happy to tell him that I started the day with the consumption of a Yeo Valley product, but in fairness I have to say that there are other impressive products in the same field, such as those from the Rachel's Organic dairies in west Wales.
I also think that the hon. Gentleman was right on some of the points that he made about diversification. Promoting the links between further education, higher education and the local economy, particularly the engagement of what were described in the past as the agricultural colleges, is extremely important. Linked to that is the work of Lantra, an organisation that promotes learning and skills in the land-based industries. The hon. Gentleman is right to say that a great deal has been done. Help is needed to allow diversification to continue further and for a sustainable economy to be promoted in areas such as his.
The Department for Environment, Food and Rural Affairs is putting an extra £2 million into Business Link next year, specifically to help to improve assistance to business, especially in lagging rural areas. We will also increase our engagement though the regional development agencies. I am pleased with the way that the RDAs have responded to our discussions in recent months. DEFRA's contribution to their single pot will increase from £45 million to £72 million next year. Rural development agencies will take a greater lead on socio-economic schemes within the England rural development programme. The total budget for the various schemes is £212 million over seven years. Since 2000 approximately £47 million has been committed from the rural enterprise scheme budget for farm diversification projects. That programme will continue.
I accept the hon. Gentleman's point about the impact of the reform of the common agricultural policy. That will vary in different areas. I understand his point about
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decoupling for the lowland beef sector in particular. Concerns have been expressed by farmers about shifting to other forms of production. I can assure him that we will monitor the impact of the new decoupled single payment scheme. If particular problems arise we will look at the options available to resolve them.
In seeking reform of the CAP, we intend to increase the flexibility available to farmers and the possibility of their engaging more with the market; the hon. Gentleman quoted the good example of adding value and therefore adding to the return to the primary producer. We also want to ensure that protection of the environment and promotion of biodiversity is achieved and that farmers are compensated for the contribution that they make to improving the rural environment and the quality of the countryside. That is in everyone's interest and involves a wide range of issues, from combating global warming to the contribution that the countryside makes both economically and in social and leisure terms.
Under the ERDP we want to look at the opportunities for increasing the return to farmers by the marketing of quality products. In terms of food in the south-west, there are some really good exemplars for the rest of the country. DEFRA and the stakeholders have been actively involved in examining the use of the agri-environment schemes to help cattle grazing. That is one of the important issues for the levels, especially because of its contribution to biodiversity and other environmental objectives. Decisions made by farmers following decoupling will be in response to market demands, not in response to the bureaucracy of individual CAP schemes. In general that means that farmers, consumers and the environment will all benefit. But, as the hon. Gentleman suggests, there are particular impacts.
The Somerset levels are a unique and internationally important area. DEFRA and English Nature have therefore been investing significant effort and resources in the environmentally sensitive area scheme and English Nature's wildlife enhancement scheme. There are 34 sites of special scientific interest in the Somerset Levels and Moors environmentally sensitive area. More than 20,000 birds may over-winter within the ESA and the ESA agreements are worth over £3.3 million a year to farmers.
There are issues in relation to the periods that land is under water in some parts of the area. I am confident that the problems that are perceived there can generally be overcome but there may be specific differences. I would be happy to expand further on such issues to the hon. Gentleman.
I would urge farmers, if they have particular concerns, to talk them through with the Rural Payments Agency, for which I have ministerial responsibility. Some of the problems might be perceived rather than real. For instance, there are perceptions that the requirement for the land to be at the farmer's disposal for at least 10 months of the year means that that requires it to be actively farmed for the whole of that period; I am advised that that is not necessarily the case.
That is the sort of area about which the hon. Gentleman will want further explanation. It is timely that he has raised these issues and I hope that I may be able to say a little more following meetings that are
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taking place this week; officials from DEFRA are meeting the National Trust and English Nature to discuss some of the issues, including marshland management and the relationship with the single payment scheme. I have asked for the issue that we are discussing to be drawn to their attention, so that it can be covered in those meetings. After they have taken place, I will write to him and I will be happy to meet and to discuss any specific issues that remain outstanding.
Finally, the hon. Gentleman mentioned the H-word, in passing, towards the end of his contribution and I understand fully that there is a particular economic and cultural impact in his part of the west country. That is why I may have spent more time listening to, and discussing with, those affected there than those in any other part of the country. That does not necessarily
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result in a meeting of minds and, clearly, legislation is now on the statute book, which I hope very much will be observed by those who are frequently described as generally law-abiding people. That will give us an opportunity for the sort of intelligent conversation that the hon. Gentleman was requesting to examine the impact on individuals. The impact in terms of the general economy may be small, but of course I appreciate that there will be an impact on individuals. I will be happy to listen to particular representations that he might want to make in respect of his area. He knows that we have supported economic assessment precisely in order to examine the very localised impacts that there might be. I will be happy to discuss those issues further with him.