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Mr. Paice: Yes, my right hon. Friend is absolutely right to stand up for sugar producers in her constituency and across the country. It is a very important crop, both in rotational terms, for example biodiversity, and, as I said earlier, in relation to food security. What we must do is reform the sugar regime to allow, wherever possible, the less developed and ACP countries to continue to send their sugar into the European market at a slightly higher price than they would otherwise get on the world market—or there is no advantage to them in doing so—but at the same time allow our producers to continue if they are efficient enough to do so.

We all accept that there must be an element of price cutting, although nothing like the percentage originally proposed by the Commission. That would mean a number of producers going out of business, particularly
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in some of the high-cost European countries. The Commission should be working with those countries on a restructuring programme to remove their quotas from the system. If the sugar quotas of the high-cost producing countries were cancelled, the need for any further quota cuts would diminish dramatically. If cuts are needed they should, as I said earlier, be imposed on those responsible for the surpluses that are being dumped on the world market and are destroying the sugar trade for other producers. I hope that that is helpful to my right hon. Friend.

Mr. Hoyle : Obviously, the hon. Gentleman is right—dairy farmers are struggling all over the country. Part of the problem is that a fair price is not being paid by the supermarkets. The processors are holding the price down, and it is continually being pushed down. That is a major barrier to the success of the dairy industry. What we should be doing is seeking a way to ensure a fair farm-gate price, which would enable the dairy industry to survive. I remind Ministers that we should have more meetings with supermarket representatives and put more pressure on them. Does the hon. Gentleman agree with that?

Mr. Paice: I have a lot of sympathy with that, but I hope the hon. Gentleman will forgive me if I do not go into much detail now because I want to deal with the whole issue of supermarkets later.

Paddy Tipping (Sherwood) (Lab): The hon. Gentleman mentioned the James review. Will he confirm that it recommends cuts of £894 million in the DEFRA budget, £112 million in the Rural Payments Agency budget—that cannot be achieved merely by outsourcing—and £47 million in the Environment Agency's budget, when we ought to be cleaning up the environment and tackling pollution? Those are big cuts that will affect front-line services. The hon. Gentleman has got a cheek calling for this debate today.

Mr. Paice: What the Government seem to have completely overlooked in the James report—probably intentionally—is that it is not just about cutting bureaucracy, although that is critical. It issues a challenge: it asks whether Government are doing things that Government should not be doing, and whether by doing those things they are imposing extra costs on farmers and every other sector of society.

The hon. Gentleman mentioned the Environment Agency. I know that he takes an interest in such matters. He should go and talk to all the farmers in his constituency who are constantly afflicted by inspectors for this, that and the other, many of them from the Environment Agency, imposing new rules and regulations that will not actually help to improve the environment. The hon. Gentleman and I agree about the need to do everything possible to improve the environment, but that causes unnecessary extra cost, which is what we are trying to weed out of the system.

Mr. Geoffrey Clifton-Brown (Cotswold) (Con): Will my hon. Friend give way?

Mr. Paice: I hope that my hon. Friend will allow me to make a little more progress.
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Behind all the failings that I have described has been a very regrettable attitude from the Government. My hon. Friend the Member for Ryedale mentioned food security, which is perhaps best put in context by a statement issued by DEFRA at the time of the 2003 royal show. DEFRA said

That, I think, underlines the absence of Government thought processes when it comes to the importance of farming and food production.

It is not just a case of the direct farming issues that the Government have neglected and the damage that they have caused to the countryside. The motion refers to other issues, including the erosion of the green belt and the absorption of villages into our conurbations, while the Deputy Prime Minister's proposals could mean the building of another 1.2 million houses on our greenfield sites. Some 58 per cent. of rural households have no regular bus service, and bus journeys outside London have declined. Our woods and forests and our timber industry have also declined. Funding for private woodlands stands at just over £18 million, compared with more than £300 million for state sector woodlands.

Mr. Mark Todd (South Derbyshire) (Lab): Will the hon. Gentleman give way?

Mr. Paice: In a moment.

The Government are obsessed with wind power as the sole source of renewable energy, even though it would leave a huge environmental footprint on the countryside. Yet they have done virtually nothing to promote the real contribution that the countryside could make to renewable energy through biofuels and biomass. The 20p per litre reduction in duty on biofuels is simply not enough to trigger the industry, notwithstanding the Government's commitment to achieving 0.3 per cent. of fuel from renewable resources this year. That figure has to be increased or supplemented by a renewables obligation. On biomass, there has been a deafening silence for the past seven years—until the setting up of a taskforce just two months ago.

Mr. Clifton-Brown rose—

Mr. Henry Bellingham (North-West Norfolk) (Con) rose—

Mr. Todd rose—

Mr. Paice: I give way first to the hon. Member for South Derbyshire (Mr. Todd).

Mr. Todd: The hon. Gentleman and I have talked many times about rural issues, and he will concede that we often agree on them. He mentioned bus services in rural areas. In South Derbyshire in 1997, 17,000 passengers were carried on community transport, which in essence serves the rural parts of my area; now, 72,000 are carried. Perhaps that experience is reflected more widely, or perhaps my area is unique.

Mr. Paice: That is not reflected more widely. I shall not dispute the figures for the hon. Gentleman's constituency as one would expect him to know better
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than others about such matters, although that is not always true of certain Members. The national statistics clearly show a considerable decline in the overall distance travelled by buses and in the number of passenger miles travelled outside London.

Mr. Clifton-Brown: I declare my interest in this subject, as listed in the register. Does my hon. Friend agree that part of the problem in farming today is DEFRA Ministers' lack of understanding of how the industry works? They have come up with one of the most complicated schemes that could possibly be imagined for the single farm payment—the historical and regional systems mixed together—and they have still to come up with the final details. Yet crops need to be planted urgently, within the next few weeks.

Mr. Paice: My hon. Friend is entirely right and I hope to discuss that issue in due course.

Mr. Bellingham: Is my hon. Friend aware that British Sugar has put in a planning application for a bioethanol plant to be installed in the beet factory in the constituency of my right hon. Friend the Member for South-West Norfolk (Mrs. Shephard)? British Sugar has made it clear that if the duty differential were more favourable and sensible, it would make such planning applications in respect of all its factories.

Mr. Paice: I am grateful to my hon. Friend for reminding me that, as he rightly says, British Sugar has put in a planning application for a bioethanol plant. However, it has made it clear in public statements that such applications are dependent on further Government action to ensure viability as far as possible. As I said earlier, the simple 20p duty reduction is not enough on its own. Further surety is needed and the Government have more than one option: another duty reduction or the introduction of a renewables obligation on fuel retailers. If we are to develop bioethanol and, even more urgently, the biodiesel sector, which is wide open to exploitation if the market can be created, we need to be certain that such a market will exist in a few years' time, not just tomorrow.

In the past seven years, we have witnessed a catalogue of neglect of, and disdain for, our rural communities and values, as my hon. Friend the Member for Cotswold (Mr. Clifton-Brown) suggested. Yet now the countryside faces its biggest economic change since 1947. Let me make it absolutely clear that the Opposition entirely endorse the principle of decoupling support from production, but very few people—be they farmers, politicians or commentators, let alone the general public—fully appreciate the scale of the change taking place. As my hon. Friend has just said, the Government's introduction of the new arrangements has been a shambles. They have introduced an extremely complicated, hybrid scheme without really understanding the complexities of the situation. The entitlement rules have been trickled out over the past few weeks, right up to 1 January when the scheme commenced.

Many of the rules are still unclear. For example, many farmers traditionally lease land for the growing of one crop, usually a root or other vegetable crop on a rotational basis, from different farmers. They still do not
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understand whether they get the entitlement or whether the farmer who owns the land gets it. It is likely that the entitlement will fall down the middle, because neither party will satisfy the 10-month occupancy rule. That is one example of the ridiculous and absurd situation that has arisen.

Instead of a simple system of payments linked to the environment, we have a system that leaves some people farming without a payment and others not farming but receiving a payment. Only a Government ignorant of what farming business is really about could have introduced such a scheme.

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