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The Minister for Rural Affairs and Local Environmental Quality (Alun Michael): I beg to move, To leave out from "House" to the end of the Question, and to add instead thereof:

Today's debate gives us an opportunity to rebut the doom and gloom purveyed by the Conservative party. The future of our rural and farming communities is enormously important for this country, and this is a timely opportunity to remind the House of the considerable progress that we have made since 1997 in
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ensuring that those communities have a sustainable future—a future that would be taken from them if the cuts envisaged by the Conservative party were made.

The current CAP reform—the most significant change in the subsidy regime for 30 years—presents real opportunities for farming. Our economists estimate that, on average, farm incomes could rise by about £100 million relative to what would happen in the absence of the single payment scheme. Current farm incomes have shown welcome signs of recovery in the past four years and are now 80 per cent. above the low point in 2000.

It is clear from the opening speech that the Conservatives want to return to subsidised farming, instead of developing the sustainable future for farming that we are helping to bring about. The Conservative threat to the rural economy is spelt out in the James report. The Opposition propose a massive cut of £112 million in the budget of the Rural Payments Agency by 2007–08, just when the agency is about to deliver the new single farm payment. How much good will that do for farmers? As the RPA made clear today, it hopes to make the single farm payments in February 2006. Our promise is that that will be done as early as possible in the payment window. Of course, payments depend on a complex IT system, whose delivery timing depends on when the fully detailed information comes from European Commission. There is now massive investment in the streamlined system, and in following years farmers will get their payments at the earliest date within the payment window. The cuts envisaged by the Conservative party—it is not just outsourcing, so let us have none of that nonsense—would wreck the programme that is being designed and delivered in partnership with farming organisations.

The Conservatives want to save £47 million in the Environment Agency, but that would severely hamper its work to support businesses, especially small and medium-sized businesses, in acting against illegal polluters, such as fly-tippers, and pursuing deregulatory measures. Barbara Young, the agency's chief executive, made those points clear yesterday.

The figures keep changing in the drip feed of the James report, but the Conservatives must answer two questions, although the hon. Member for South-East Cambridgeshire (Mr. Paice) failed to do so in response to hon. Members' interventions. First, how can they claim to care about farming and rural areas if they are prepared to slash services, as the James report recommends? Secondly, how have they done their sums? Let us have chapter and verse on how they have worked out their figures. What do they intend to cut, and from where? We know only the total figures, which appear to be ill judged and dangerously threatening to the countryside. Such information is even not detailed on their website, and the hon. Gentleman could not answer those questions when he took interventions. Let us hear from Opposition Front Benchers exactly where the cuts will fall, or they will stand condemned by their silence. Our farmers need to know.

David Taylor (North-West Leicestershire) (Lab/Co-op): Does the Minister intend to deal with the future of the Food Standards Agency under the proposed cuts? The scale of its activities would be halved, which would
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have a serious consequential effect on public health and almost certainly a knock-on effect on international confidence in the quality of British food.

Alun Michael: My hon. Friend makes an important point. The Conservative party is dangerously slack in its approach to not only farming, the rural economy and the environment but the health of the nation.

Let us get the facts straight about the rural economy. It is vital that we do not confuse rural communities with farming communities. Farming remains at the heart of many communities, but it is by no means the dominant economic activity in the countryside, and we must keep that in perspective.

The majority of rural England is thriving. It is true that unemployment has fallen by 24 per cent. in urban areas since 1997, but it has fallen by 26 per cent. in rural areas. Rural communities generally are benefiting from the same economic prosperity as urban communities, with low unemployment and interest rates—the lowest for 40 years—and real growth of nearly 3 per cent. a year since 1997. The rural economy has benefited from our national economic success, not least because businesses of all types increasingly feature in rural as well as urban areas. Employees in our rural areas are more likely to work in sectors other than farming. Some 17 per cent. work in manufacturing, some 15 per cent. work in wholesale and retail, and some 9 per cent. work in hotels and restaurants, while only 7 per cent. work in farming.

Farming is now well placed to respond to the changes that it faces. Through the strategy for sustainable farming and food, the industry, consumers and the Government are working together to help farming to increase its competitiveness and reconnect with the market. I shall return to farming issues in a moment.

Rural services have been enhanced since 1997 due to the Government's concerted action. Let me give a few examples. The number of schools closing in rural areas was running at 30 a year between 1993 and 1997, but that has come down to an average of six a year since 1997. We are supporting more than 2,000 bus services a year through the rural bus subsidy grant. Such support would be slashed under the Conservatives, yet they have the cheek to talk about fewer buses. We are providing £150 million a year to support the rural post office network, so the number of closures has fallen from more than 300 a year to about 100 a year. As we promised, there are now more than 100 primary care one-stop or mobile units providing care to people in rural areas.

We are neither satisfied nor complacent because many rural communities face real challenges and problems. Farmers are not having an easy time—I shall address some of the problems in a moment—but let us debate these real issues on the basis of evidence, rather than myth and misrepresentation, which was all that we heard from the hon. Member for South-East Cambridgeshire.

Mr. Liddell-Grainger : The Minister is aware that many of the jobs being created in the countryside are seasonal with a very low cost base. That is what is happening in places such as Exmoor. Does he not understand that we are looking for a long-term commitment and long-term jobs, not seasonal jobs?
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Alun Michael: The hon. Gentleman is wrong. There are low-paid jobs in urban and rural areas, but the Government's success in delivering broadband access to rural areas is giving a wide range of businesses that previously could operate only in urban areas the opportunity to operate in rural areas. That is happening because there are many intelligent entrepreneurs in rural communities—men and many women who are opening the sort of business that has never before been seen in rural areas. I say to the hon. Gentleman, with great respect, that he has not connected with the type of change that is occurring in our rural areas.

Mr. Hoyle : Is it fair to say that the rural economy has benefited from the minimum wage, without which there would have been a lot of poverty in rural areas? It was the Labour Government who took that brave stance.

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