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Finally, Section 11 of the Landlord and Tenant Act 1985 deals with repairing obligations of landlords in short leases of dwelling-houses. As I explained yesterday, we would expect parties to a farm business tenancy to make their own arrangements for repairs which would apply to the whole holding.

We do not want special provisions in respect of houses. I should also like to point out that none of these provisions applies in relation to tenancies covered by the Agricultural Holdings Act 1986. I hope that that point in itself will commend what I have said to the noble Lord as he seems keen to follow the precedent of the 1986 Act. I would urge him to do so in this particular case and I hope that he will be content with the explanation that I have given.

Lord Carter: I am grateful to the Minister. I shall certainly wish to read the explanation and I shall of course withdraw the amendment. Perhaps the Minister can confirm the point that none of this changes the situation which was drawn to the attention of the Committee yesterday by my noble friend Lord Gallacher. My noble friend said that at the end of the tenancy the farmer will have less protection in his house than will the farm workers on that same farm. It is a situation to which we shall certainly wish to return at a later stage of the Bill. However, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendments Nos. 93 and 94 not moved.]

The Deputy Chairman: In calling Amendment No. 95, I should explain to the Committee that there is a mistake in the Marshalled List. A section of an earlier amendment has been wrongly included. Sub-paragraphs (2), (3) and (4) are incorrectly included and should be deleted.

Lord Carter moved Amendment No. 95:

Page 28, line 27, at end insert:
("The Agricultural Holdings Act 1986 (c.5)
1. In paragraph 6 of Schedule 6 to the Agricultural Holdings Act 1986 (occupation to be disregarded for the purposes of occupancy condition) there shall be added to the end of sub-paragraph (1)—
(g) under a farm business tenancy within the meaning of the Agricultural Tenancies Act 1995 granted for less than five years.

The noble Lord said: Perhaps I may make it absolutely clear that the mistake was not in the drafting amendment. Apparently it was due to a computer glitch somewhere in the Public Bill Office which somehow

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lifted sub-paragraphs (2), (3) and (4) from a previous page and deposited them at the end of Amendment No. 95. To make it clear to the Committee, Amendment No. 95 ends with the word "years" at the end of sub-paragraph (g). The paragraphs listed below have nothing to do with it.

I can deal with the amendment fairly briefly. Again, it is an attempt to amend the Agricultural Holdings Act 1986. I hope that the Minister will not give me the same answer he gave earlier. The succession procedures under the Agricultural Holdings Act 1986 depend upon the applicant passing a number of tests, one of which relates to the scale of his present business. In assessing this, the present law disregards all land that is held under Gladstone v. Bower tenancies for up to two years and short lets approved by the Ministry of Agriculture which cannot be for more than five years.

The purpose of the amendment is to carry forward the present practical position so that, for example, someone with 100 acres held under a Gladstone v. Bower tenancy this year would not lose his opportunity to gain succession by holding the same 100 acres next year on an 18-month farm business tenancy under the terms of the Bill. We have had the industry agreement referred to a number of times. This amendment has been suggested by the NFU. One of the obvious uses of the farm business tenancy (I have already referred to it a number of times) is to regularise the number of cases—the situation with share farming, with contract farming and with Gladstone v. Bower arrangements. There seems to be a flaw which, were it not picked up and corrected, would mean that the incentive to switch from a Gladstone v. Bower tenancy to a farm business tenancy could be reduced. I beg to move.

Earl Howe: I cannot help wondering whether the amendment, as printed, is the product of a fax. My fax machine tends at intervals to spill out unsolicited garbage in large quantities. I would therefore not wish to associate myself wholly with the comparison that the noble Lord's noble friend—

Lord Carter: So that is the argument the noble Earl uses when he is debating the problem!

Earl Howe: I hope not. I am grateful for the noble Lord's explanation of the purpose of this amendment. There appears to be a case for allowing short farm business tenancies to be excluded when determining whether or not a farmer already occupies a commercial unit of agricultural land. I shall consider this point further. I hope that the noble Lord will be content to withdraw the amendment on the basis of that assurance.

Lord Carter: That is a U-turn within half an hour! The noble Earl said earlier in relation to another amendment that the Government would not consider any changes to the Agricultural Holdings Act 1986, but when we produce an amendment that is sensible the Government are prepared to accept it. There will be many other examples of that at later stages of the Bill. In the meantime, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Schedule agreed to.

House resumed: Bill reported with amendments.

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Milk Development Council Order 1994

6.42 p.m.

Earl Howe rose to move, That the draft order laid before the House on 30th November be approved [2nd Report from the Joint Committee].

The noble Earl said: My Lords, it is right that I should declare a personal interest as a milk producer.

The draft order is presented in accordance with the requirements of the Industrial Organisation and Development Act 1947. Its purpose is to establish a milk development council for Great Britain, the primary function of which will be to commission research and development in dairying. The order will empower the council to raise a levy for this purpose on sales of milk by farmers.

Before going into the details of the order, I should like to explain to your Lordships a little of the background. I emphasise at the outset that there have been full consultations with all interested parties as required under the 1947 Act. The draft order takes account of the views expressed.

In July 1993 the former Minister of Agriculture received proposals for a milk development council from the NFU. A compulsory levy was preferred because it was thought it would ensure that there would be no discrimination between milk producers and would provide greater certainty and continuity of funds. My right honourable friend conducted a poll of milk producers in England and Wales in April 1994 with a view to finding out whether they would support the establishment of a development council under the Industrial Organisation and Development Act 1947. A parallel poll was conducted in Scotland. There was no request from farmers' representatives in Northern Ireland for the development council to be extended to the Province. Interested organisations were consulted about the establishment of the development council at the same time that milk producers were being polled. The majority of organisations consulted were in favour and producers gave their overwhelming support. The response rate to the postal ballot of producers was 66 per cent. and 73 per cent. of those who voted favoured the establishment of a development council. In the light of the support from all sides of the industry, my right honourable friend and the Secretaries of State for Scotland and for Wales decided that a milk development council should be established.

Noble Lords will recall that provisions relating to agricultural development councils were included in the Agriculture Act 1993, the legislation which, among other things, ended the milk marketing schemes in Great Britain. When the legislation was passing through the House, I explained to your Lordships that the National Farmers Union was advocating the establishment of a milk development council.

Your Lordships will wish to note that Article 2 of the draft order restricts the activities of the development council to Great Britain. Article 2 also restricts the definition of "milk" to cows' milk. Goats' milk and sheep's milk will not be subject to the levy and it is not

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envisaged that the development council will undertake any work in this area. Article 2(2) ensures that producer processors are required to pay the levy.

The functions of the council are dealt with in Article 3 and Schedule 1. The broad range of functions listed in Schedule 1 will enable the council to set its own agenda and continue some of the functions previously undertaken by the milk marketing boards in Great Britain. It will, for example, be able to cover such areas as the funding of R&D, livestock improvement, human nutritional guidance, the preparation of industry statistics, the provision of market information and the management of health, hygiene and other crisis issues which are not company or brand specific.

Article 4 specifies the number of members to be appointed and requires all appointments to be made by Ministers. Under the 1947 Act, a development council must comprise people capable of representing the interests of producers, people capable of representing the interests of employees, and independent members with no financial or industrial interests that might affect them in the discharge of their duties. The Act provides that members with special knowledge of milk distribution and marketing may also be appointed. It is the intention of Ministers to appoint the full complement of six producer representatives, two employee representatives, two independent members (one of whom will be the chairman, as required by the 1947 Act) and one member with specialist knowledge of milk distribution and marketing. We feel it is important that producer representatives are in the majority on the council since it is milk producers who will provide the council's levy income.

We have not accepted the NFU's suggestion that the producer representatives should be active milk producers. That would rule out talented people whose active involvement in milk production may have diminished—for example, as a result of handing over to a son or daughter the responsibility for day-to-day management of the farm—but who are well qualified to represent the interests of dairy farmers. It is envisaged that the member with specialist knowledge of milk distribution and marketing should also be able to represent the views of first-hand purchasers of milk in their role as intermediary levy collectors for the council.

Article 5 introduces Schedule 2, which sets out the council's rules of procedure. Members will be appointed for a term not exceeding four years. The general practice will be for appointments lasting three years, but some flexibility is desirable.

Articles 6 and 7 set out the arrangements for the registration of producers. As required by the 1947 Act, anyone may inspect the register or obtain a copy of the entries upon payment of a fee. Producers will be required to register with the council within 120 days of the order coming into force, unless they have been informed by the council that they are already registered.

Article 8 provides the council with powers to require returns and information from farmers relating to their activities in milk production, having first obtained ministerial consent.

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Article 9 provides for the council to raise a charge on the sale of milk by farmers to meet its expenses. As envisaged in the explanatory note, which accompanied the polling forms sent to all milk producers in Great Britain, the council will be empowered to impose a levy not exceeding 0.05 pence per litre. It also provides for purchasers to act as intermediaries in the collection of the producer levy. In that context, it is envisaged that an agency agreement would be drawn up which would make clear the obligations placed on the individual parties. In signing an agency agreement purchasers would agree to collect the producer levy (by making a deduction from the producer's monthly payment cheque) but would not be obliged to pursue producers who subsequently decided that they did not want to pay. In such cases the purchaser would be obliged to notify the council, which would then have to pursue the producers concerned.

Article 9(6) reflects the wishes of both milk producers and purchasers that the levy should commence on the first day of the month after which the order comes into force. This was considered desirable from an administrative point of view. Article 10 contains standard provisions permitting the council to borrow money and create reserves. Article 11 provides for returns of sales to assist with levy collection. Article 12 deals with offences against the order.

The council will have an important task to perform, and in its first few months will be faced with a number of issues. As well as having to decide which areas of work to support, it will have to decide on its administrative arrangements. While decisions on these matters are, within the legislative framework, entirely for the council, my department is ready to provide it with any assistance that it can. We wish the new Milk Development Council well, and I am happy to commend the draft order to your Lordships.

Moved, That the draft order laid before the House on 30th November be approved [2nd Report from the Joint Committee]. —(Earl Howe.)

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