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Lord Hoyle: My Lords, I must remind the noble Lord of the time constraints.

Lord Hooson: My Lords, I am sorry, I did not realise that time had passed so quickly. It is time that the beef ban was lifted from herds where one can make sure that there has been no BSE outbreak for at least the past 10 years.

3.37 p.m.

The Lord Bishop of Bath and Wells: My Lords, I am grateful to the noble Earl, Lord Ferrers, for initiating this debate at a time of such severe crisis in the farming industry. I spent most of my working life in East London trying to explain and often defend the inner cities and urban life. Now I work in Somerset and find my concern there sharpened by my travels and consultation in my diocese, not only with farmers who are regular churchgoers, but with many others through my presidency of the Royal Bath and West of England Show.

I am especially concerned, not only for hill farmers in my diocese, but also for lowland livestock farmers. I recently wrote to the Secretary of State expressing their anger, frustration and near despair at what is happening. In 1997 there has been a £1.9 billion overall fall in farmers' income. In the South West the income of dairy farmers has fallen by between 55 and 59 per cent., and that of livestock farmers by between 37 per cent. and as much as 85 per cent.

In addition, farmers are coping with increased overdrafts and the threat of extra charges that have just been mentioned. As a farmer on Exmoor said to me this week, "Half of us will soon be on family credit". That seems to be the reverse of the Government's policy: it is a move from work to welfare. People who give their

21 Jan 1998 : Column 1524

all, whatever their conditions of work, will be brought down to dependence. The phrase most commonly used by farmers, as we heard this afternoon, is that all they ask for is a level praying field--I apologise, I mean a level playing field, though perhaps they ought to have a level "praying" field as well!

The market, the green pound and the lack of confidence are making the situation nearly impossible, but it is not only about the financial crisis that I want to speak--others are much more qualified than I am to do that. Important though that is, there is also a serious crisis of morale which goes far deeper. It concerns fear for the future of farming itself.

It has been my real pleasure in my years in Somerset to go to many harvest festivals. They are a reminder every year of what lies at the heart of agriculture. It is a covenant, a deep agreement, involving rights and responsibilities. The covenant made between God and the people provides the framework for stewardship of the land. In the United Kingdom the majority of people have delegated the care of our countryside to the farmers. Most of the people I dealt with in East London certainly did just that. Even in the national parks the farmers are substantial partners with the authorities responsible.

The way we express this covenant now, this covenant with God, is through ecology. Ecology includes the proper moral balance in playing our human role, without greed or abuse of nature, and proper harvesting from the generosity of the Creator. This covenant between the nation and the farmers has been breached. Sometimes the agricultural industry itself has done damage, usually in the struggle with market forces, or corporate demands for profit, or in some of the process of industrialising and intensifying farming. The agricultural industry has not been blameless. But now, through successive governments, there is an even more serious breach. The situation has become untrustworthy and it is feared not only that farmers will go broke but also that their sons and daughters will turn away--indeed, they are turning away--from farming itself. A most precious tradition is undermined.

Many of the urban population are becoming alienated from nature, prissifying it, not recognising its laws. Neither do they realise sometimes how much the farmers do day by day to maintain, preserve and protect our countryside which goes totally unrewarded financially. Recently my home was flooded. The three people who came to my aid were local farmers. They found the source of the trouble and they dealt with it there and then. I have no doubt that it would have cost a great deal to the local authority if they had not taken that care.

Personally, I believe that present subsidies have frequently distorted that trust and have drawn us further away from the farming that will enhance and strengthen our ecology. It seems to me that there ought to be a shift towards a recognition of the role farmers play in preserving our countryside. But a farmer cannot walk away from his herd. If the losses pile up, he cannot just lock the door of the countryside and walk away from it. This loss of income will not be sustainable for long.

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Already Churches, unions and others have had to set up for farmers Samaritan organisations and now the Rural Stress Information Network. This is not imagination. These are the realities of farming life as I see it in my diocese.

It is not just on this issue that farmers feel oppressed by what they see as largely urban priorities and urban understandings. It is essential that moves are taken, after full consultation and exploration, so that farmers know what is happening, so that they believe the Government want them to carry on this important responsibility, so that people appreciate the many services done to support and preserve our countryside and to feed us. This covenant goes very deep within our culture and our society. The current breach has cracked the fabric of farming interests, mostly in those places where survival is often the name of the task, where I meet very few farmers living in luxury.

I fully recognise the problems faced by the Government, but there needs to be financial help; there needs to be a policy which sustains farmers in their essential task of feeding us and conserving the countryside; and there needs, above all, to be good communication and understanding which works for change with farmers and not against them.

3.45 p.m.

Lord Jopling: My Lords, I begin by declaring an interest, as did my noble friend Lord Ferrers, as a farmer involved in arable and lowland beef farming. I do not wish to spend all my time talking about the present crisis but it is the most serious I have known in 40 years of active agriculture. The point has been extremely well covered by my noble friend Lord Ferrers, the right reverend Prelate and the noble Lord, Lord Hooson, who demonstrated clearly just how serious the crisis is.

I was brought up with the saying that there are two things in life you never see: one is a dead donkey and the other is a satisfied farmer. It is difficult to find satisfied farmers today, and they have every justification. I want to say to the Minister that there are two areas, in which I am not involved, which cause me the most concern. This stems from my previous incarnation in another place. I refer to the prospects for hill farmers. Already public support to that group exceeds the level of their income. It is highly worrying as to whether they will be able to maintain a living on the hills. The nation as a whole would suffer grievously if the hills were to revert to dereliction. I am also concerned--perhaps even more so--about some of those smaller tenant farmers who do not receive the benefit of hill subsidies, are not on good land, do not have secondary incomes and face the most serious prospects of all at this time. I hope the Government will give particular attention to those groups.

One of the ways that could be done is through the environmentally sensitive areas scheme, in which I claim a paternal interest and which fulfils many of the needs in the areas I am most concerned about. But there are many other things which the Government could do through opportunities arising from our membership of the European Union and through the common

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agricultural policy. Those of us who have been involved are very familiar indeed with the arguments put up by the Treasury at times like this, when discussions revolve around green pound adjustments. I have to say in passing that the complexities of green currencies and the bovine stubbornness of the Treasury have given me a long-term sympathy for a common European currency. That would be a way of escaping from all the nonsense that arises from green pounds.

What concerns me especially at this time is the widely held belief that the urban vote and urban interests are ganging up on country people. There is a certain amount of evidence for that. I find it hard to accept that the Labour Party--and the current Minister in particular--is both deaf and blind to the current situation. Dr. Cunningham, who was for many years a constituency neighbour of mine, followed a highly distinguished line of Labour Ministers--Tom Williams, Fred Peart and the noble Lord, Lord Cledwyn, all of whom did admirable and honourable service to agriculture and the countryside. I cannot believe in my bones that the Labour Party and the Labour Government will ignore the interests of agriculture at this most difficult time. So I hope that the Government will bring relief in a positive way. I also hope that they will avoid negative steps and proposals at this time.

I remain unhappy at the recent ban on beef on the bone. I recognise, of course, that there is a massive ministerial mantra in setting aside highly technical advice which is given to Ministers, especially by people like lawyers and scientists, where the Minister does not have the training to be able to question fully the advice that he receives. Obviously, I have not seen the advice given to the Minister by scientists as regards beef on the bone, but my guess is that that advice was even more compelling given how little we know about the science of BSE.

I would like the Minister to answer one question either at the end of this debate or when we come to debate the beef bones regulation next Tuesday. It relates to my own recollections. When the scientists recommended to us that there should be a ban on the sale of green top milk--milk which has not been pasteurised--we were told that it was a serious health risk, that many people each year became ill through drinking unpasteurised milk and that in the future people might well die unless its sale was banned. After giving the matter some thought, we decided in the end to ban all but direct sales of green top milk from the farm, but to let the thousands of people who seemed keen to take the risk continue to drink it, while we gave full publicity to the hazards about which we had been told. I believe that was a sensible solution in response to this type of scientific advice.

As regards my own point of view on green top milk, for 25 years I have made it publicly clear that I would not touch the stuff. But if people want to--which they do--I do not believe that it is up to us to stop them. So my question to the Minister is this: will he tell us what is the difference between unpasteurised milk and beef on the bone--because to me the situations seem exactly similar? We have to ask the question: is there some evidence about beef which has caused this ban, but

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which has not yet been revealed? It is a highly important question and I hope the Minister will refer to it at the end of the debate.

3.52 p.m.

Lord Grantchester: My Lords, I am grateful to the noble Earl, Lord Ferrers, for initiating the debate. I declare an interest. I own and manage a dairy farm in Cheshire. It is particularly poignant to debate the importance of agriculture at the moment when the United Kingdom begins a six-month term of presidency of the European Union, when reform and change are at the top of the agenda, and when all sectors of agriculture are simultaneously suffering.

The national statistic is that agriculture produces only 1.4 per cent. of gross domestic product, employing only 2 per cent. of the workforce. A far more accurate portrayal of the importance of agriculture comes from the fact that 77 per cent. of total land area is shaped by agriculture. It has an overwhelming influence on our environment. Agriculture underpins the rural economy. Using OECD's area classification, agriculture accounts for 11.6 per cent. of total employment in predominantly rural areas. It is only the continuing presence of farming that ensures that many communities remain viable.

The situation in the livestock sector, especially meat, is desperate. The all-cattle price last week stood at 89.78p a kilo, down from the already low figure of 110p one year ago. Meanwhile, the added costs of regulation are being heaped on to the industry. From April it will have to meet all the Meat Hygiene Service's costs of £44 million, the rendering industry's costs, the start-up and annual costs of the cattle movement service, and now the food standards agency.

If farming is to absorb these costs and be competitive, it needs to know that the Government are treating them in exactly the same way as other countries treat their farmers. It needs to know that quality controls are uniform. The "Back British Meat" campaign is being promoted precisely because they fear imported meat is not demonstrably produced to UK standards. Nor can farmers accept that only in the United Kingdom is there no compensation against green pound revaluations.

It is vital that the Government hear these concerns as they start the UK's six-month presidency of the EU with Agenda 2000 proposals to be agreed, and with fundamental CAP reform on their mind. Three issues face agriculture at the present time--standards, confidence and responsibility.

The view from most political persuasions is unanimous. Agriculture must learn to live without subsidy; to be able to compete at world prices; to operate in an ecologically sustainable manner; and to create an environment to be enjoyed at leisure.

What does it mean to produce at world prices when trade is often only of marginal surplus production that is then dumped? To produce everything at world prices means fundamental changes in production methods to drive down unit costs and increase volume.

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Are British cereal farmers to be told to compete against American and Australian wheat prairie farmers? Are beef farmers to be encouraged to set up massive intensive beef lots? Consumers and environmentalists would presumably vote against that form of farming. But they are very glad to import its food and eat it.

The BSE debacle means that the United Kingdom is uniquely setting standards of hygiene and control. But the problem of BSE is not unique to Britain. Consumers perceive all produce, whatever its source, as potentially hazardous. But British agriculture must not be unique in meeting these costs and controls. The standards being enforced with their cost implications are vital in restoring consumer confidence. Where it is possible to give the consumer information on standards, this must be done to rebuild confidence. Abattoirs are now being inspected and scored on their hygiene methods, and those results are now available. The Government must act to look to a method to bring this information before the consumer at the supermarket shelf as an issue of confidence and not leave it to the industry as a promotional tool.

Finally, I wish to deal with responsibility. Agriculture looks to the Government to provide effective administration; to provide a framework to the industry; and to provide policy on agriculture, the environment and rural development issues. Is this being adequately performed by the Ministry?

Following the election last May the Government signalled the importance of agriculture and food issues with the appointment of Dr. Jack Cunningham as Minister, thus raising its importance in the Cabinet. Dr. Cunningham has said:

    "This department will be changed beyond all recognition in a period of months from now. We have already begun to reorganise the department, to separate out the Food Standards Agency personnel ... I have inherited a closed, inward looking, secretive unresponsive department which has not enjoyed the best of reputations in the past two or three years".

Those were strong words for a Minister to say of his department. However, I am now more confident that fundamental reform issues are being addressed and that British agriculture can look to the future with confidence.

Despite all the reviews being undertaken by government, for MAFF, the fundamental questions remain. With the food standards agency coming under the Department of Health and the regional development agencies, which have taken over some of the Rural Development Commission's functions, coming under the Department of the Environment, it is vital to the agricultural industry that MAFF fulfils a strategic role and provides a rural voice in government. However, this is being jeopardised because it has a distinctly separate structure.

The regional development agencies will operate from government regional offices which do not correspond to MAFF's regional centres. Furthermore, the regional boundaries do not correspond to those operated by MAFF. For example, my area of Cheshire, Staffordshire and Shropshire is operated from the Ministry's Mercia office in Crewe while the West Midlands government office in Birmingham includes Staffordshire and

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Shropshire but not Cheshire, which is defined as being in the north west. There are very grave concerns that MAFF will be unable to provide a strategic input if it is not even in the same room.

The importance of agriculture in rural areas demands that it should take a full role in the regional development agencies. How can these agencies fail to be dominated by urban perspectives if MAFF will not participate? Rural and urban issues must be taken together if the development of a region is to reflect all enterprises.

The Ministry of Agriculture, Fisheries and Food must not continue with its inward-looking, siege mentality. MAFF must be reformed into a leadership role at the centre of rural and regional development issues. It is vital that MAFF be re-born as the Ministry of Agriculture, Rural Affairs and Fisheries. It must help to meet the objectives of government in rural affairs and to ensure they do not become more isolationist and producer-focused but, rather, keep consumer and environmental concerns as high priorities to accord with developments to transform the CAP into an integrated rural policy. Such developments will strengthen the relationship between farmers, the countryside and the country as a whole. The long-term future of British agriculture demands nothing less.

4.1 p.m.

Lord Prior: My Lords, my noble friend Lord Ferrers made a splendid speech. He is able to combine a rumbustious style with a felicitous touch which does not seem to upset people too much. At the same time, he manages to include many facts. That leaves very little opportunity for any other noble Lord to say something new.

This is the first time that I have taken part in an agriculture debate in Parliament for over 25 years. I come to this debate not as someone who takes much interest in agricultural politics, but as someone who has farmed all his life, who loves the countryside and who has great affection and respect for all in the farming community. However, that does not mean that I do not understand some of the "crying wolf" that we have heard from the farming industry over the years. To my cost, I have known times when things were nothing like so bad as the farming community used to make out. That needs to be said because when farming gets into trouble--I believe that it is now in serious trouble--many people say, "We have heard all those arguments before from the farmers over the years and we simply do not believe them".

Unfortunately, the position is worse now because of the way in which the subsidies paid to farmers through the common agricultural policy changed some three or four years ago so that they reflected more an acreage payment and less a commodity payment. The result is that some very large payments are being made to a number of very large farmers whereas previously, when the subsidy reflected the commodity, it was included in the price of the commodity and not on the basis of acreage. It was perhaps also unfortunate that just when those changes were being made the world was suffering a possible food shortage. Prices rose and the pound was devalued. That

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gave us an added advantage. I should add that the profits being made on arable farms two or three years ago were very high.

None of that alters the fact that the situation has now changed totally. Sometimes in agriculture--perhaps one should say "always in agriculture"--it is "up corn" and "down horn" or vice versa, but now, most unusually, it is a case of "down corn" and "down horn".

The industry has to try to see through this difficult period as best it can. As my noble friend Lord Ferrers said, I believe that we can legitimately look to the Government for some temporary and immediate support. If there is a change in the value of the pound and if circumstances generally change, British agriculture can stand pretty well on its own feet, certainly in competition with anyone else in Europe. So, in the long run, I do not think that there will be problems. However, there will be a problem if we so erode British agriculture now in the short term that it loses its great advantage in European agriculture in the long term. Therefore, I believe that short-term assistance now can be justified.

I am not certain that I agree with my noble friend Lord Jopling who said that he would do almost anything to remove himself from the maw of the British Treasury. I have wanted to do that all my life, but I am not certain that I would want to put my life into the hands of central bankers because they are not known for their humanity and kindness to industries such as agriculture. We need to be careful about thinking that European monetary union is the answer to all our problems. I am not at all certain that it is.

I turn now to BSE. Twenty-seven years ago, when I had some responsibility for agriculture, there were periodic food scares. Products used to be removed from supermarket shelves, and the matter referred to a committee of experts which produced a report before everything went back to normal. The media paid very little attention and nothing really happened. Now, any food scare is built up into a national disaster. Everything is different now. I remember saying in the House when Statements about BSE were made last spring that I hoped that the Government--at that time, the government of my own party--would try to think through how to deal with future scares because they were bound to happen. Even after the latest beef-on-the-bone scare, I am certain that there will be other scares over the next year or two with which the Government will have to deal. Some proper risk assessment and a judgment of the risk needs to be made in a period of calm so that the Government can make up their own mind more adequately about whether or not we need the sort of publicity that there has been in the past two or three years.

I hope that the Government will listen. We have had a good run in farming for a number of years. Perhaps it could be said that arable farmers still have a bit of fat to last them through another year but, after that year, the whole industry will be in great trouble; and that will be a national disaster. As the right reverend Prelate and others have said, it will cause great trouble in the countryside if farmers feel that they are being neglected to that extent. The plight of the small farmers in the hills is very difficult.

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They are the salt of the earth and they produce wonderful people as well as wonderful stock. I hope that the Government will not allow them to go to the wall.

4.8 p.m.

Lord Beaumont of Whitley: My Lords, I join those who have congratulated the noble Earl, Lord Ferrers, on introducing the debate and for a set piece of almost unparalleled brilliance on the farcical tragedy of BSE. It was necessary for the noble Lord, Lord Hooson, to temper that set piece a little only by pointing out how much of it occurred under the previous government.

Attention has been drawn, and will continue to be drawn during the debate, to the financial plight of the farmers. As has been said, farmers are always in a financial plight:

    "The farmer is such an unfortunate man He lives with his heart in his boots For either the rain is destroying his grain Or the drought is destroying his roots".

But those were the normal hazards of farming and those farmers did not have to deal with the CAP, BSE and the green pound. However, anything which affects the ordinary farmer--and he is now facing real trouble--affects the family farmer in spades or, in this case, in bloody shovels, doubled and redoubled.

In your Lordships' House I have sung, as have the noble Duke, the Duke of Buccleuch, and others, of the importance of the family farmer to rural life as well as agriculture. I am delighted to see that at last even the National Farmers Union is beginning to pay attention to it.

There are, according to Marie Skinner who farms 445 acres and is therefore not a small farmer, three categories of farmer who deserve public sympathy and government support:

    "First, the hill farmers who are suffering, not because this year is bad, but because it comes after many, many years of struggle and low incomes. Second, beef producers, hit by the BSE disaster. They have had two years of suffering in which their businesses have declined, regardless of what they have done. They face a future which is uncertain and over which they have no control. Third, those on small, family, lowland farms. However hard they work, they cannot compete with the economies of scale of their larger neighbours. Their fields and farms that have sustained families for generations are seen as ripe for takeover by ambitious agribusinesses. Their precious holdings are being gobbled up at an alarming rate. Overnight they disappear, another livelihood gone. Whole farms turn into just another field on a large estate".

We must act to put this situation into reverse. It is not just the general run of things that makes family farms a real problem at the moment. There is the added problem of BSE and milk. The noble Lord, Lord Jopling, asked the Minister what the Government intended to do about BSE in the light of what had been decided in relation to milk. As I understand it, the Government are considering banning the sale of unpasteurised milk from the farm gate. I hope that the Minister will be able to tell us that that is not so. If that were the case it would have a greater effect even than BSE. In an article in the Sunday Telegraph last week Adam Nicolson wrote:

    "the grand headline of the great Rooker Milk Reform: Government Triumph--Minister Acts To Prevent Four People Going to Hospital".

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That is the level of risk about which we are speaking in this area; and in the main small farmers are involved in that particular problem, too.

One of the answers is to have a modulation of subsidies. I understand it has been suggested that subsidies should be paid on only the first 50 hectares of land. That is probably too drastic a measure but there is a lot to be said for it. Certainly, it would help family farms, see hedgerows restored and bring back farms on which animals are known by name by those who tend them. These are the kinds of action we need to take. We must come to the help of the family farmer. We must come to the help of the whole agricultural industry if we want a decent rural countryside and a decent environment in the countryside. In particular, we must help the small farmer.

That splendid writer on small farming, Paul Heiney, said recently that he had real faith in the future of the small farm and that eventually, after all the trials and tribulations, the small family farm would come strolling down the catwalk to a standing ovation. I look forward to that day but I doubt whether, when the day comes, there will be any family farms left to stroll down the catwalk. That would be a real tragedy.

4.15 p.m.

Lord De Ramsey: My Lords, I am extremely grateful to my noble friend Lord Ferrers for this debate and his vigorously expressed views. I must declare an interest as I farm on the edges of the Fens. The recent precipitous downturn in agricultural fortunes has been vividly described by many noble Lords, but it has come as no surprise to most of us who have any knowledge of the history of agricultural fortunes. In my grain store is pinned up the Latin quotation--most of my tractor drivers have had a classical education--semper in excretia sumus solim profundum variat, which means, "We are always in the manure; only the depth varies".

One sometimes gains the impression from the media that all agriculture in the Community is subsidised, whereas many of us are already competing on world markets because we produce unsupported commodities. The simple truth about world markets is that the closer you get to them the greater the price variation from year to year. Onions are among the unsupported crops that I grow. In the past four years I have sold class 1 onions at anything from £25 per tonne to £387 per tonne. Even the supermarkets are forced to reflect that price variation in their retail sale price. My old neighbour Fred Hartley commented to me, "Well, my boy, while you grow vegetables it will be either pop and cockles or champagne and oysters." I do not see much champagne on the horizon at the moment. Therefore, world market prices affect both farmer and customer.

But agriculture is unique. What other industry has so many or such important responsibilities as landscape, recreation and conservation? In the 1930s bankruptcy caused dereliction in the countryside. For instance, the land between Huntingdon and Cambridge--some 18 miles--was unfarmed and was worth only what one

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could get for rabbit shooting. It quickly became scrubland of little or no conservation value. The British public knows what it wants its countryside to look like and it is not scrubland but cared for farmed countryside. This land was quickly brought back into production in the first years of the Second World War.

I am amazed to discover how few people realise what continental Europeans had to cope with during the closing years of the Second World War. Forty thousand Dutch people died of starvation in the last 18 months of the war and there were food riots in Italy and France. It is hardly surprising that we swore we would never starve again. Thus, the common agricultural policy was born out of dire necessity. That does not mean that reform is not overdue. In food terms it has been stunningly successful but now society realises that it has gone too far and wants to repair some of the damage to the countryside which it paid farmers to do to avoid starvation. What a wonderful opportunity for the European Union to seek environmental improvements in the reform of the CAP, or Agenda 2000 as it is known.

The UK leads the Community in its environmental schemes such as ESAs, farm stewardship and farm woodland schemes. But these are extras or add-ons and they will remain so unless the environment is made a central part of the goods bought by society from farmers. They must do this in a positive way, not by so-called cross-compliance but by buying green goods. I have never understood the argument for tying environmental payments to agricultural support. To suggest this at a time when all the signals are that support will be reduced to nil seems madness. It is a bit like a nurse in hospital who wakes up the patient in order to give him a sleeping pill. I understand the logic of competing in world markets but not the logic of tying environmental conditions to a doomed and dying system.

In order to compete on world markets we need economic units, not part-time small holdings. The call for the return of the small farmer can be sentimental and thoughtless. The many profitable small farmers will always survive--and very enterprising they are in the Fens and in other parts of the country. To subsidise them with ever larger sums to try to make them competitive on world markets is clearly illogical. Why not use their skills to deliver green goods as we do in the hills? Let us have profitable farms that can compete on equal terms in a world market.

I was delighted to hear the Minister of Agriculture at the Oxford Farming Conference defend our larger farm structure against modulation. Only successful farmers restore streams, plant hedges and either save elm trees or plant replacements when they are attacked by elm disease. No bureaucracy or institution can achieve that for the whole country; it must be farmers with their skills and knowledge who can care for the countryside. Only successful agriculture can afford the technology which will reduce chemical inputs to soil and groundwater. For instance, I am now using satellite technology to map soil nutrients every 10 yards, enabling pinpoint accuracy to applications for all

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chemicals. That technology is essential for sustainable agriculture, and for our children's future, so they, too, can play their part in caring for the countryside.

I go back to those three factors: landscape, recreation and conservation. They are a key part of the beauty and spiritual quality of the country in which we live. There is far more at stake than the profit and loss accounts of farmers. We are risking the very soul of our countryside.

4.21 p.m.

Earl Peel: My Lords, I, too, thank my noble friend for having introduced the debate in his inimitable style which the House has come to appreciate and greatly enjoy. Today was no exception. It may be too early to tell whether we are witnessing a genuine crisis in the agricultural business, unless, of course, one happens to be involved in the beef sector. I should perhaps declare an interest in that I own land in North Yorkshire which is tenanted, and some of my farmers there are experiencing a very serious crisis. We have heard various figures as to how much farm incomes have dropped over the past year or so. They vary according to whether one reads the NFU report or the CLA report, but it is obviously about 40 per cent. to 45 per cent.

Today's debate considers, among other things, the importance of agriculture within the UK. Farmers obviously play an important part because they produce food. They have done so effectively and efficiently. The nation owes them a great debt of gratitude. They are also responsible for managing 75 per cent. of the land mass, so they have additional responsibilities.

The CLA figures, which many noble Lords will have read, show that agriculture and its ancillary activities create major levels of employment in many of our rural areas. So often farming is the linchpin which holds together the social structure of much of our countryside. Another point is that agriculture commands high levels of investment for both the tenant and the landlord, and any serious collapse in the industry could have widespread financial ramifications.

We are told that CAP reform is on the way. That depends largely upon whether one listens to Mr. Fischler or Chancellor Kohl. It seems inevitable that we will move towards world market prices. I wonder what the effects of that will be on farming, land management, and employment in the countryside. Figures I saw the other day indicated that only 25 per cent. of cereal producers in this country would survive on a free market price of £75 a tonne.

What will happen to the smaller farms, the marginal farms, the family farms about which we all care so much? I suspect that many of them might suffer; they might go. We would have larger, more intensive units, with fewer people to support the rural infrastructure and the traditional skills of the countryside.

In addition, we cannot ignore the effects of genetically modified plants, which we discussed on a Question the other day. There would be less land, producing more, with, I suspect, major environmental implications. It is fair to say that modern farming practice has not always been kind to the countryside. Habitats have been destroyed and agri-chemical sprays

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have taken their toll. As we all know, there are innovative farmers who have done much. Field sports have done as much as anything to help habitats and wildlife in this country. We have government schemes, ESAs, and a whole range of different things which have helped. We have the work of the NGOs and the RSPB. My noble friend Lady Young will be addressing your Lordships later, and I applaud the work that that organisation has done.

With the exception of one or two rogue farmers, the vast majority have merely responded to conditions. There is no doubt that they have played a major role in this country's economic success. However I fear that as profits are squeezed, and the freedom to farm--as the Americans call it--becomes more intense, the environment will be put under ever-increasing pressure.

The balance between agricultural needs and environmental objectives must be addressed through CAP reform. Surely the time has now come to consider seriously a Minister or ministry of rural affairs. I am interested to know what the Minister has to say about that. The state of agriculture cannot be judged solely by short-term economics. Farmers know only too well that there are good times and bad times. So much has to do with confidence, and that confidence often emanates from government. At the moment the messages coming from Whitehall are not as helpful as they might be.

We have already discussed the strength of the pound, and the Government's perceived reluctance to seek compensation. The recent ban on beef has already been referred to. With regard to beef on the bone, I just cannot understand how a government who are so keen on consumer choice could have taken that choice away from the consumer, and kicked the farming industry in the teeth.

We have seen the abandonment of the agricultural regional advisory panels. That was a means by which the grass roots of the agriculture business had a direct line to civil servants and Ministers. They have now been replaced by an advisory group to the Minister made up, as I understand it, of 11 consultees--if I may call them that--only one of whom is a part-time farmer. I have a great deal of respect for members of the panel but it is an imbalance which I find extraordinary.

We have recently witnessed the demise of the Rural Development Commission. In addition we have the threat of the right to roam, which will remove property rights, bring conflict when we seek harmony and introduce a theme park mentality which would undermine respect and management of the countryside.

As my noble friend Lord Ferrers said, there is the threat of the demise of hunting, which plays such an important part in the social fabric of the countryside. All those points show, me at any rate, that there is an attack on rural communities. It can only drive a great wedge between town and country. The Government have a responsibility to bring the two sides together. Farming is changing. There are opportunities for improvement, particularly with regard to environmental sustainability, but the principles remain the same: there must be support when support is necessary; there must

21 Jan 1998 : Column 1536

be confidence, clear direction, and an incentive to manage. We cannot abandon a major sector of society when we need its skills for the future. If we are to take the best of the new and retain the best of the old, the country needs to take the farming community with it. We must work with it, not against it, and the Government must take a lead.

4.29 p.m.

Lord Palmer: My Lords, I, too, am grateful to the noble Earl, Lord Ferrers, for tabling this important Motion. I hope by now that the noble Lord, Lord Donoughue, is fully aware of the deepening crisis--the worst in living memory--that is facing agriculture in this country. Dare I say it, if Her Majesty's Government's proposals to exclude hereditary Peers from the right to speak in your Lordships' Chamber had been in place, this debate would have had half the number of speakers, thus depriving it of many valuable contributions.

Many of us speaking today care passionately about the countryside and it is our forebears who created the countryside that is so widely and universally cherished today. I must declare an interest as one who struggles to survive as a farmer in the Scottish Borders. How much longer I shall survive I do not know. That is one of the frightening aspects of farming: you have no control of your own destiny. Very few other businesses can claim the same.

All winter crops are safely in the ground, but no one has any idea how much they will cost to nurture, to harvest, to dry and, of course, now in these troubled times, virtually no idea what they will produce in financial terms. It must not be forgotten that farmers are also greatly reliant on getting the right weather at the right time. This winter having been so mild, prospects for a good yielding harvest are slipping away fast and furiously.

One of the saddest things in farming today is that I do not believe there is a single farmer in whatever sector who is getting one ounce of job satisfaction. I suspect that also applies to the 604,000 people who make up the United Kingdom's farming workforce.

Another important point not to be forgotten is the chain and ball of long-term planning. Farmers simply cannot just change production methods or what they grow or produce overnight. As other noble Lords have mentioned, a vibrant and buoyant rural environment greatly depends on a thriving and profitable agricultural industry.

May I make a plea to Her Majesty's Government to keep the paperwork that farmers are now required to complete to the barest minimum? The average 500-acre farmer now spends two days every week of the year on paperwork. Surely that is crazy. I believe that all these are important points for Her Majesty's Government to take on board when assessing the overall crisis facing this country's farming industry.

Many interesting figures have been bandied about today by other noble Lords regarding the crisis, but when you study Professor Nix's Index of UK Farming Income (down by 70 per cent. since 1970) and Deloitte

21 Jan 1998 : Column 1537

Touche's prediction that a 76 per cent. fall in income will be incurred by farmers for this coming year, the rural scene looks bleak--bleaker than at any other time this century.

Other noble Lords have mentioned the green pound and with a 14 per cent. reduction in its value last year following a 5.5 per cent. reduction in 1996, I strongly urge Her Majesty's Government to put in motion the mechanism available. As other noble Lords have said, virtually every other European Union country has implemented this mechanism to compensate farmers for the effects of the strong rate of the pound. I also urge Her Majesty's Government vehemently to resist any attempts at modulation as this would further unjustly penalise our farmers.

Finally, I believe most strongly that more money should be ploughed into research and development for renewable energy from agricultural crops. The taxing of such fuels should be looked at again most seriously. I urge the Minister to take up that point with his right honourable friend the Chancellor of the Exchequer. I am sure that no one here today believes that North Sea oil will last for ever. We owe it to future generations to invest now and on a massive scale.

I read a piece of wonderful poetry over the Christmas Recess and I think it sums up why this country's agricultural industry desperately needs help from Her Majesty's Government:

    "A farmer was outside the Pearly Gates, 'What have you done' St Peter asked 'That you seek admission here?' 'I have been a farmer, Sir' he said 'For many and many a year'. 'The Pearly Gates swung open wide 'As St Peter pressed the bell 'Come in' he said, 'and choose your harp 'You've had your taste of hell!"

4.34 p.m.

The Earl of Radnor: My Lords, I too am grateful to the noble Earl, Lord Ferrers, for bringing up the subject today. It comes at an important moment in farming history and, as he pointed out, an unhappy one. I must declare an interest. I am chairman of a large farming company and I am in a number of farming partnerships rearing practically everything except--thank goodness!--poultry. Like the noble Lord, Lord Prior, I believe that there are two stages to the problem, because problem it is. One is the immediate one which has been described fully and I shall go through parts of it again. The second stage is the future.

Farming is a slow process. The seasons roll by slowly, although they seem to go faster as one grows older. We want to be able to plan ahead better than we have in the past. I have been reading parts of Agenda 2000, which points out various ways in which the CAP might move. I wish to comment on that too.

To start with, I point out that farming is of huge importance. It is not just a matter of how much land it covers, I believe it is more important that it produces two-thirds of our food every year--and very good food it is. At the same time, as many people have mentioned, agriculture keeps the country looking as it should. There

21 Jan 1998 : Column 1538

have been good stewards and there have been terrible scenes, small events blown up by the press, of the gentleman who grew linseed on the Sussex Downs. We can think of a number of others, such as the farmer who cut down a line of trees. But by and large we enjoy the countryside because of the farmers. The noble Earl, Lord Peel, added that it was because of the sportsmen too, I expect he is right but basically it is because of the farmers. There is one hobby-horse which I always wanted to bring up in the House. It is that one of the most awful things that happened to the countryside was the invention of the hedge cutter. It roars along the tops of hedges and never allows the tillers and saplings to grow up into trees. So people say that we must plant them. They grow perfectly well in hedges, and in the days of the billhook you could preserve the saplings.

As regards the area of land, one of the few points that has not been mentioned today is that it will shrink fast if the Deputy Prime Minister has his way and builds as many houses as he currently intends through the Midlands, Sussex and all over the place. The scheme will involve thousands of hectares, and with it will go roads and all the rest of it. The real desecrators of the countryside have not been the farmers; the desecration has been caused by society, with its need for more and more houses. We hear of the present need for masses more houses when the population of the country is static. Perhaps it is because of single parent families, or because we live too long. It is distressing to feel that about 65,000 houses or some such number will be built in Sussex. You can bet your bottom dollar that some will go up on the Chichester plain with the richest and best soils we have in farming in the whole country, comparable to Romney Marsh and the Fens, mentioned by the noble Lord, Lord De Ramsey.

I agree with the noble Lord, Lord Beaumont of Whitley, that there should be some differentiation in any future subsidies between the big farmer and the small farmer. I see perfectly well the dangers that will lay us open to being taken for a ride in Europe. But surely throughout history, since the war, and since a gentleman called Mr. Evans in another place accused farmers of being feather-bedded, the problem has been that if we support the small farmer, we give too much to the rich farmer. In some way that must be sorted out, and it is mentioned in Agenda 2000.

I remember some time ago--and I have a note of it--when I was privileged to sit on Sub-Committee D, at least twice examining the CAP and how it should be reorganised. Professors Tangerman and Marsh had perhaps too slick an idea of solving the business of subsidies by the issuance of an income-earning bond in proportion to the smaller and larger farmers. In time, it would lose its income-bearing capacity and be saleable, so that the farmer could choose whether to sell the lot and get out of the game or buy a whole lot more and build a bigger unit. I suggest that it might be worth taking that idea out of the cupboard and dusting it down. I refer to the 16th report of Sub-Committee D, for 1990 to 1991.

Strangely, I am worried about competition in farming. I had always sold my cattle in an open market, but these days that is not popular because it is said that it is

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uncomfortable for the animals. Our food outlets, the great supermarkets, are powerful and have long since influenced the purchasers of food. I am sure that now they are in the country they are determined to get rid of the markets, bring matters into their own hands and begin to dictate the price. I live outside Salisbury, where there are 40,000 people. There are two Tescos, one Sainsbury's and two Safeways, and an ASDA is about to arrive. I am frightened of them with their Aberdeen Angus clubs and so forth.

4.42 p.m.

Lord Stanley of Alderley: My Lords, I thank my noble friend for initiating the debate. I am sure he will agree that agriculture today is totally different from that of 1973 when I first came into contact with him as Under-Secretary of State for Agriculture. We are now controlled by CAP rules and future direction, which up until now has been a fortress Europe policy. Most of your Lordships, and the Government in particular, would agree that such a policy should not continue.

I shall concentrate my remarks on the particular problems which an open market policy will cause in western areas of the United Kingdom, but most of my remarks apply throughout the UK. These western areas are predominantly devoted to beef and sheep production. The first is inherently unprofitable, and unless sheep flocks are very considerably larger than at present, or managed on a part-time basis, they, too, are--or will be--unprofitable. Anyone who has noted the problems of St. Lucia's banana farmers, or is conscious of the problems which British agriculture faced from 1870 to 1914, must see the frightening similarity to today's position when the market is left to work totally unguided. However, we might well take unnecessary action before we need to because fortress Europe, for better or worse, will be propped up by continental farmers for a time.

More importantly, small farmers and their families are the backbone of stability and social life, particularly in the rural areas that I have mentioned. Such a course of action would cause problems. We would see much more than beefburgers thrown into Holyhead harbour. I hope, therefore, that the Government will support a long-term plan to encourage a more efficient and economically viable system of farming, keeping, not preserving, farmers in these areas.

The Government will not achieve that unless they provide as level a playing field as possible for those remaining in farming. The failure of the Government to adjust our currency has destroyed what little credibility they had with farmers. It is just not acceptable to state that it would cost too much. That is the price the Government have to pay for following a free market policy. Lord knows, it is costing farmers far more.

There are a number of other actions which the Government can take. For instance, they can ensure the prompt payment of accounts by MAFF; encourage co-operatives, particularly between neighbouring farms, coupled with retirement grants; actively encourage part-time farming by making planning simpler and

21 Jan 1998 : Column 1540

sympathetic to alternative forms of income earning; and improve the infrastructure which will encourage outside firms to operate in rural areas.

I accept that we have no satisfactory alternative but to operate in a more competitive world, but I would hope that the Government would accept the measures that I have suggested in order to ease some of the pain. They could make an immediate start, costing nothing, by recognising that there is such a thing as a rural philosophy and code which is closely tied to nature and in particular to animals, both farm and wild. It seems that that is not recognised on the Benches behind the Government spokesmen because I can see only four noble Lords there.

I conclude by supporting my noble friend Lord Ferrers and saying that I regret having to waste both my time and that of your Lordships' in speaking today, for like any farmer I know that this Government will not listen to the farming or rural voice. I have not seen a dead donkey for years. One day the Government will regret it.

4.47 p.m.

The Duke of Marlborough: My Lords, I, too, thank my noble friend Lord Ferrers for initiating this important debate. As a landowner and farmer, I declare an interest. Today I wish to address your Lordships' House as a farmer and a lover of the countryside in which I have the privilege to work and live. I am aware of the problems facing UK agriculture. In my own farming business we have to manage and adapt to changing markets, legislation, currency fluctuations and even climate. Farm incomes have been coming under severe pressure this year, falling by more than 40 per cent. in real terms, mainly as a result of the strength of sterling. The inevitable result will be reduced reinvestment and further restructuring of the industry. Alas, one fears that unless something is done many will be forced from the land in the coming years.

To me, farming and agriculture are now even more important to the UK than they were 50 years ago. Although the emphasis of that importance has changed in the public's eye, its fundamental strength as the backbone of the rural economy is undiminished. Without a strong and prosperous agriculture, the countryside will invariably suffer and public tolerance of that will be stretched to the limit. As times have changed and public awareness has been heightened by closer media attention, agriculture has had to adapt to the likes of BSE and other animal welfare issues such as battery cages, sow tethers and tail docking. The arable farmer has equally been closely scrutinised and concerns over pesticides, nitrates and so forth continue to have to be dealt with.

The fundamental issue is still abundantly clear. The customer, whether it be the housewife, the supermarket, the greengrocer or the butcher, wants the best quality at competitive prices. That is precisely what UK agriculture is able to produce. We may have been caught out by recent food scares, but the UK farmer has been quick to react and is working hard to rebuild confidence across all sectors. The proposed new food standards

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agency will do much to restore consumer confidence but not, it is hoped, at further cost to the farmer. Wide-ranging animal welfare issues are being adopted throughout the country to end some of the less savoury practices which originally stemmed from the drive for ultimate efficiency and production. It is my belief that UK produce is the safest, highest quality and most attractive in Europe. I wish it to continue to be so for many years to come.

We welcome those who choose to move from towns and cities to the countryside but ask that they respect the traditions that we have inherited from previous generations and that they, too, learn to adapt and understand the rural pleasures of our beloved countryside that we from time to time take for granted.

Farmers have limited assets with which to work. However, the asset which is fundamental to their well-being and that which they prize more highly than anything else is the land that they work. The vast majority of farmers that I know--and I certainly follow the principle myself--believe that we must look after the land resource at all costs. I do not believe that farmers have ever ignored their environment. It is the public, who are now taking a greater interest in that, who have heightened perceptions as to how it should be managed.

As the vast majority of rural land is cultivated or grazed in one way or another, it is surely the farmers who should be entrusted with that well-being. They have many generations of experience and are intimately aware of the intricacies and peculiarities of the land in their control. Many farmers--and I am pleased to say that I am one of them--continue to strive to improve the conservation and environmental features of their holdings. Like many others, we have undertaken widespread hedge and tree planting programmes and actively encouraged managed access across our farms. I stress the word "managed" because we do not want a right to roam.

Farmers are proud of what they are entrusted with and enjoy sharing it with a wider public. Subsidies and grants certainly help us to promote those activities, but without the knowledge, expertise and long-term commitment from farmers, one suspects that there would be very little active environmental management within the countryside.

Finally, I confirm my belief in the importance of agriculture within the UK. Agriculture, and in particular food hygiene, have become important issues. I am afraid that there is little prospect of any significant improvement for farmers in the coming years, especially with the cloud of BSE and the strong pound hanging over them. We need a reform of the CAP to produce a rural policy which will sustain agriculture, our countryside, environment and rural communities. We need encouragement and support from the Government.

4.53 p.m.

Lord Geraint: My Lords, I thank the noble Earl, Lord Ferrers, for his sound, sensible and constructive contribution on behalf of the agricultural industry today.

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I hope that the Minister will take heed of what the noble Earl said. I should also declare an interest as a hill farmer.

The first Labour government after the war in 1947 transformed the agricultural industry. The late Tom Williams, who was Minister for Agriculture at the time, introduced the Agriculture Act 1947 which guaranteed prices for farmers' produce--beef, lamb, wool, milk and other commodities. Security and stability helped to secure a sound and prosperous agricultural industry for decades thereafter.

But today, the scene has changed. The agricultural industry would not be in the financial predicament in which it is today if the previous Conservative government had not mishandled the BSE crisis two years ago. That is the main cause of the disastrous decline in farmers' incomes. For the agricultural industry it was one of the greatest political blunders of all time.

In my view, the lifting of the beef export ban is a must, and sooner rather than later. It should be given top priority by the Government if the beef industry is to be given any chance of recovery. The Government must provide help to a sector which contributes to the rural economy, employment and the countryside in order to maintain a much-needed level playing field in Europe.

I have several questions for the Minister. What are the latest developments regarding the lifting of the beef ban in Northern Ireland? How strong is any German opposition to the easing of the ban? In my view at present the Germans are having the best of both worlds in relation to the beef industry.

Can the Minister confirm that the British Armed Forces consume very little of the beef that we produce in this country? When will he have talks with the Ministry of Defence about that indefensible action?

Perhaps I may quote from Farming News, one of our leading agricultural publications, where the following appeared in the opinion column of last week's edition:

    "Yet, if we don't eat subsidised beef off subsidised fields at home, we will be dining instead on Irish and French beef that is even more heavily subsidised by British taxpayers. Given a choice, and a little encouragement, the big retailers will offer domestic products in preference to imports.

    The problem lies with manufacturers who source their farm commodities from wherever they are cheapest in terms of Euros. These people aren't swayed by patriotism; they answer only to exchange rates.

    The only way to persuade them to buy British is to allow sterling to fall".

In my view, leading supermarkets control the future destiny of British agriculture. Once more I urge members of this Government to discuss their future role in order to protect the interests of producers and consumers alike. I should also like the Minister to try to sort out the problems in the dairy industry with the chairman of the Milk Marque and other organisations. It is well known that producers are paid approximately 20 pence per litre today for their milk. Many consumers pay more than 70 pence per litre. It is time that someone did something to help the dairy industry.

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I have seen a set of figures from Messrs. Morgan Evans, auctioneers, of Gaerwen, Anglesey, North Wales. On 27th November 1987, the price of steers was 103 pence per kilo, while on 16th January of this year that was down to 86 pence per kilo. On 27th November, 1987, lambs were 184 pence per kilo, while on 16th January 1998 they were 75 pence per kilo. I have just telephoned my friend Aled Ellis who runs the Aberystwyth Mart in Cardiganshire and he tells me that lambs today at the sale average 72.2 pence per kilo.

The farmers out there want one very important question answered. The question is to the Minister. Can he give us an assurance that the beef ban will be lifted in three months, six months or by the end of the year? If not, what is the alternative? Will it be compensation on a large scale, or the end of the agricultural industry as we know it? The choice and the challenge is in the hands of the Government: remember what your predecessors in government did in 1947 for the industry. Please do not fail the industry this time.

5 p.m.

Lord Kimball: My Lords, at no time in the last half century have all sections of the agricultural industry been in such serious decline, and that applies right across the board--sheep, corn, sugarbeet and cattle. In all quarters of the House I believe we agree that the Motion of my noble friend Lord Ferrers comes at a most opportune moment. We shall have an opportunity next Tuesday afternoon to look in depth at the whole question of beef on the bone and the situation of cattle.

However, what is really annoying the farming community is the simple fact that they know that there is £980 million of European compensation money waiting to be given out, but the Government are not prepared to act. As my noble friend Lord Ferrers said, most of the other European governments have done this. Worse still, the German and Irish governments did so with an added supplement, and the German and Irish farmers do not have the problem of the strong pound that we have in this country.

I wish to concentrate on two other fears that arise in the countryside and which have not so far been mentioned. First, there is the threat of the new regional development agencies; and, secondly--and I rather thought my noble friend Lord Radnor was going to develop this point--there is the modulation of the IACS payments on farm structure. The Regional Development Agencies Bill is grinding its way through the other place. In the rural areas they will replace the much respected Rural Development Commission to which my noble friend Lord Peel paid tribute. I add to that by paying tribute to what my noble friend Lord Shuttleworth has done. In rural Lincolnshire it is quite incredible what has been achieved as regards the diversification of rural employment. From 1979 to 1997 half a million jobs were created in the rural countryside thanks to the efforts of my noble friend.

What are we threatened with? The Rural Development Commission has gone and we find that the regional development agencies have powers which

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override those of local authorities in areas of planning and environmental improvement. Those RDAs represent nothing more than the biggest quangos ever invented. All members of the regional development agencies will be appointed by Ministers with no responsibility to the locally elected representatives. The position of the new RDAs was best summed up by my noble friend Lord Deedes in the Daily Telegraph where he referred to the,

    "creation of 9 urban committees deciding how the urban dweller can make best use of the countryside".

When the Minister replies, can he give the House an undertaking that representations will be made by the Ministry of Agriculture that at least one person with knowledge of agriculture and the countryside will be on each one of the regional development agencies?

My second point concerns farm structure. In good times and bad, farm business structures have to adapt to ensure competitive production. Farm businesses are capital intensive, resulting in ownership structures which are frequently complex but which reflect the diverse interests of different members of farming and landowning families. One of the factors that must be taken into account is the availability of payments under the various IACS schemes.

It is clear that the EU is not seeking to frustrate changes in farm structure, nor is it the intention to deny new farm business IACS payments. However, there is, as so often in this country, what appears to be a different view in MAFF. There is a growing fear that MAFF is administering the claims in a way which may well deny them their proper entitlement to IACS payments. Clarity is necessary but is, at present, seriously absent. Can the Minister say if the European Commission has prepared any guidelines as to what constitutes a separate business? Are the guidelines known to MAFF? If so, can they be published?

I have in mind the problem when the ownership of farms is vested in trustees but the responsibility for management lies elsewhere. When a trustee is involved in another farming business, even as an active manager, it would be unjust that the business where he is merely a trustee should suffer modulation or be denied IACS payments. I must press the Minister for clarity and a more enlightened approach than we have had so far.

The countryside is very unhappy today, however urban and suburban modern Britain may be and however much more of rural England has to be built on as the green belt gives way under pressure from the Rural Development Commission. A government who neglect the countryside and agriculture will destroy all that is best in Britain.

5.6 p.m.

Lord Astor of Hever: My Lords, I, too, should like to declare an interest as the owner of a small agricultural estate. Today's debate concerns the importance of agriculture. Equally important for the further prosperity and quality of our countryside is the stewardship of our woodlands. In recent years government has encouraged farmers to diversify their enterprises and improve the farm environment through new woodland planting under

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the Woodland Grant Scheme and the Farm Woodland Premium Scheme. Many more farmers now have an interest in forestry and woodlands. For many, their woodlands are not just a landscape feature, but a key part of their commercial enterprise.

Yesterday, the Prime Minister launched the new UK Forestry Standard, which he rightly described as,

    "the most significant forestry document of the past decade".

The standard provides, for the first time, a clear picture of the high standards woodland managers are required to achieve. It is particularly welcome as it is the result of a broad consensus across the forestry environmental spectrum. What the standard demonstrates, very clearly, is just how much woodland management is required to deliver the public benefits now required from woodland owners and farmers, such as landscape quality, biodiversity and recreational opportunities. These public benefits can only be provided through active management.

Nowadays farmers get paid for provision of these sorts of benefit under schemes such as MAFF's Countryside Stewardship Scheme. Grants are payable for the likes of annual management or capital work and, in addition, for provision of access. According to the literature, the scheme,

    "aims to make conservation part of farming and land management practice".

If such positive encouragement to good practice is to be provided to farmers, why should it be forced on foresters? If woodland stewardship payments could become an integral part of our woodland grant structure, then everyone would gain.

At a time when timber prices have fallen right back and the restocking grants, which were halved in 1994, have not been increased even in line with inflation, many woodland owners find they have little option but to scale down activity. There is very little financial support for good stewardship of our woodlands under the current grant scheme. The economics of forestry are highly marginal for many owners at the moment, and I am afraid that, with the move to recycling, there is little prospect of immediate improvement, even if currency exchange rates were to move in our favour overnight.

With the new Government now in place, it is time to look again at how we can best support good woodland stewardship. Forestry organisations such as the Timber Growers' Organisation believe that the Woodland Grant Scheme needs recasting so that the promotion of good woodland stewardship is at its heart, rather than its margins.

Finally, we must make sure that forestry is made central to government policy making for the rural economy. Too often it seems to be a mere afterthought and this Cinderella status is clear when one looks at the figures. Agricultural support stands at £5 billion, while that for forestry is just £40 million. A recent example of this is the Scottish Office paper, Towards a Development Strategy for Rural Scotland. Astonishingly, although there are sections on agriculture and fisheries, the word "forestry" hardly appears--and that in Scotland, the most forested part of the UK, where

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over 15 per cent. of the land area is under woodland. Forestry presents real opportunities for farmers and for rural Britain. What is required is a real strategic approach for England, Scotland and Wales within the UK framework, and the sooner we can get that under way, the better.

5.10 p.m.

Lord Clifford of Chudleigh: My Lords, despite the favouritism shown towards the urban and suburban population by the elected Members of Parliament, members of the rural community are most grateful to have the opportunity to vent their feelings about how they use and cultivate the land in the island of Great Britain and Northern Ireland. I hope that the executive branch of Westminster will not only listen but react positively to what is being discussed today.

Agriculture covers not only livestock, cereals, sugar beet and horticulture but also woodlands, as the noble Lord, Lord Astor, has said. Some 7 per cent. of this country's land is under woodlands and in the largest county, Devon, 8 per cent. of land is covered by woodlands. This massive area of 148,000 hectares provides employment for those cultivating and caring for the primary woodlands as well as those involved in manufacturing and retailing the forestry product. More than half a million people--that is 540,000--are directly affected by this form of land use and still we import 80 per cent. of required timber. Why is that? That is because eastern Europe sells wood to us at £90 per cubic metre sawn and we cannot begin to sell at less than £110 per cubic metre before sawing or slabbing. So, why cut trees? Why even plant trees if one is not expecting a return sufficient to employ staff? In the past many a woodland, coppice and plantation was planted for scenic or amenity value or game shooting. But now, with the advent of the "Foster" syndrome against country sports, the incentive to plant trees and hedgerows will be severely affected.

The eastern Europeans are to be "welcomed" into the Common Market under Mr. Blair's presidency, so he will be condoning the disruption of our farming industry by approving the "no tariff, no borders" principle ratified by European members, many of whom do not apply the same strict regulations to their farmers as is the case in the United Kingdom. Let us consider deboned beef, for instance. Whereas the vast majority of imported beef is deboned, who is to ascertain that the specified risk materials (SRM) were removed in accordance with UK practice? There is less regulation, so less cost to retailers and inevitable undermining of UK beef producers. We, the UK beef producers, have been set, and have complied with, the highest standards to eradicate BSE from the food chain. However, our European neighbours recommend only that the beef ban be lifted from certified herds--that is, the computer processed variety, which is relevant only to Northern Ireland--and even then not immediately permitting the sale of marketable meat, as there is a big difference between the certified herd proposal being made and convincing other member states that it should proceed.

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Labelling a product usually assures the purchaser of a certain quality and a credible standard. When the common agricultural policy is revised, origin labelling must be mandatory. At present any European Union member state may apply its name to what may be grown or reared anywhere provided the product has undergone a degree of processing in the country retailing that product.

Those involved in beef and sheep production--that is 32,000 families and their employees in the south-west--urge the Government to make rapid progress to lift the export ban on beef cattle born after 1st August 1996; to ensure strict enforcement of restrictions on beef imports; to remove weight limit payments on cattle of over 30 months with no further cuts in the standard compensation payment; to abandon the idea of extra charges for meat rendering, inspection and passports; to apply for the next slice of green pound compensation as soon as the opportunity arises, and to give the south-west the same financial aid as allocated to the Welsh to promote their agricultural market. The latest government grant for that purpose was £200,000.

If the Minister really cares about the farming industry, and if he really believes in freedom of choice, he should not impose a ban on untreated milk. Raw milk is labelled; let the people choose.

The profoundly urban Government, the House of Commons, encourages policies which appear to be driven by urban aspirations for the countryside. To a Government who call themselves caring we say, "Take care. We hope you will listen to us before imposing a right to roam policy". The 1995 dog fouling Bill was again urban oriented. No notice was taken of the damage caused by the invasion of the countryside--the workplace of sheep, cattle and dairy farmers--of unwormed urban dogs whose defecation in fields deposits the Toxocara tapeworm eggs which damage and devalue the liver and eyesight of sheep and cattle. Let me remind the Government, who are rightly concerned about public health--I refer to BSE, the ban on beef on the bone and the anxiety about too many antibiotics in animal feed--that the same worm infects those children and adults who work and play in the countryside.

The landowners and farmers in the south-west say, "Take care". If the Government impose their ban on hunting, fishing and shooting, we shall lose any incentive to plant coppices, hedgerows and woods for the future. The south-west foresters beg Mr. Elliot Morley to follow the example of the post-War Labour Government and consider the benefits gained from the 1947 Forestry Act. The Government should consider the benefit of that to our environment, our children, and, more importantly, to our grandchildren.

Farm incomes have already been covered, but farming, like any other industry, is to be subjected to the European Union inspired minimum wage at the same time as the European Union is imposing further regulations and restrictions on agricultural production. Our Government are "jogging alongside" the European Union and so minimising the essential margin necessary

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for any business. Brussels wishes to raise wages and to cut the opportunity to sell the product. Do we not recognise the threat of redundancies? And the Government try to reform the present system. It is madness.

I have not touched upon the horticultural, poultry or cereal markets but implore the Minister, Mr. Cunningham, and the Prime Minister, Mr. Blair, to think of the British families involved. Grant them priority when using the taxpayers' purse. Encourage the food industry to buy British.

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