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Lord Campbell of Alloway: My Lords, further to the question raised by the noble Lord, Lord Wallace of Saltaire, how will the part played by our forces in planning be effective without NATO pooled intelligence?

Baroness Symons of Vernham Dean: My Lords, as we have discussed previously in this House, intelligence matters are not likely to operate any differently from the way in which they operate in NATO at present. The way in which intelligence is used, or indeed shared, will be a matter for the countries from which the intelligence emanates--a matter for the capitals of those countries. So I do not believe that we are entering any different or unknown territory in the European dimension of which we are now talking.

Arts Boards Merger: Consultation

2.48 p.m.

Viscount Falkland asked Her Majesty's Government:

Lord McIntosh of Haringey: My Lords, the Secretary of State is looking forward to receiving further details from the Arts Council of England about its proposed merger with the regional arts boards. He has, however, made it clear that his approval of the changes will be conditional on the Arts Council being able to demonstrate that the proposals will indeed deliver a genuinely simpler funding mechanism, lower administration costs and enhanced decentralisation.

Viscount Falkland: My Lords, I thank the Minister for that Answer. However, he has not quite answered my question about the principle of decentralisation. Whatever the merits of the Arts Council's prospectus for these sweeping and radical changes, it seems that little consultation took place with the local arts boards, which are to disappear under the plan. Did consultation take place with the noble Lord's department any more than it did with local arts boards? Does the matter not give rise to concern?

Lord McIntosh of Haringey: My Lords, consultation is taking place now; this is a consultation document. There was a feeling, I understand, among some regional

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arts boards and others that they had received less than adequate notice of what was being proposed by the Arts Council of England. However, the fact that the Arts Council is taking consultation seriously is evidenced by the extension of the consultation period from the end of April to the end of June. The Secretary of State was indeed consulted before the announcement was made, and the Department of the Environment, Transport and the Regions was informed.

Foot and Mouth Disease: Economic Impact

2.50 p.m.

Baroness Miller of Chilthorne Domer asked Her Majesty's Government:

    Whether they believe that the impact of foot and mouth disease upon the rural economy can be alleviated.

The Parliamentary Under-Secretary of State, Department of the Environment, Transport and the Regions (Lord Whitty): My Lords, the most important way to help rural businesses adversely affected by foot and mouth is to bring back their customers and restore confidence. The Government are stressing that Britain is open for business and encouraging the reopening of attractions and footpaths in line with MAFF guidance and veterinary advice on risk assessments. In addition, tourist boards are strongly promoting what attractions are open.

The Government have also introduced a range of measures to alleviate the impact in rural areas. That initiative is being rigorously pursued by the agencies responsible. The Rural Task Force, upon which a Statement will be delivered later today, is monitoring the results and considering measures to help kick-start the rural economy once the outbreak of foot and mouth has been eradicated.

Baroness Miller of Chilthorne Domer: My Lords, I thank the Minister for his reply. Does he accept, however, that the rural economy was already in crisis before the foot and mouth outbreak? If the noble Lord visited some rural parts of the South West over Easter--I visited Cornwall and Devon--I am sure that he would agree that the rural economy in the region is in melt-down, not only because of the lack of tourists but also because local people in the area are forced into more inactivity than is usually the case. Does the noble Lord also agree that small businesses, which make up 90 per cent of rural businesses, are suffering most? Do the Government really believe that they are doing enough in the face of this crisis which comes on top of an already extremely severe period for the rural economy?

Lord Whitty: My Lords, I accept that there were a significant number of problems in the agricultural sector prior to the outbreak of foot and mouth and that the latter has obviously very drastically

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exacerbated such problems. However, the tourist industry was previously in relatively good shape in most of our rural areas. Like the noble Baroness, I spent some of the Easter break in Cornwall, Devon and Dorset. I noticed that there were a number of tourists in those areas. Nevertheless, the noble Baroness is correct to say that there are serious problems for the rural economy as a whole, especially for small businesses. That is why the package of measures of short-term help we have provided relates primarily to help for small businesses of all sorts within rural areas. Much effort is already being directed towards helping such businesses.

The Countess of Mar: My Lords, does the Minister appreciate that some businesses will never get back their customers? I have in mind, for example, a local milking machine fitter who was busy installing a very high-tech system for a local farmer. However, as soon as the farm became part of an infected area, the fitter came off the job. The farmer then had his cows killed. So the farmer now has a half-fitted milking machine system; the supplier will never get his money; and, indeed, the original supplier will never retrieve his money. Hundreds and thousands of little businesses all over the country are collapsing because of this crisis. It is not just the tourism industry that is suffering. Can the noble Lord please make clear what help is being given to people like the milking machine fitter I mentioned?

Lord Whitty: My Lords, there will inevitably be some very serious problems of that nature. The knock-on effect of the crisis in the agricultural sector will no doubt be severe in many sectors. We have provided help for businesses, which will eventually recover but which are faced with short-term cash flow or demand problems, in the form of hardship rate relief, deferral of rate payments, extended time to pay, and improvements in the small businesses' service and the small business loans guarantee scheme. Therefore, businesses that have a future will find some relief from such pressures. But, inevitably, there will be problems of the kind outlined by the noble Countess. It is very difficult to see how we can deal with all such problems.

Baroness Mallalieu: My Lords, although the measures just outlined by my noble friend are all valuable in their own ways, does he accept that none of them will save some of the small businesses that are essential to the survival of rural communities in areas like the South West where the noble Baroness and I spent the Easter break; for example, many small shops? Will the Government contemplate giving some direct aid to essential local businesses which must survive but will not survive until people return to the countryside? That, realistically, will not happen until the rotting carcasses have gone and the burning has ended. Will my noble friend consider help to keep those essential businesses going for the next three months?

Lord Whitty: My Lords, the measures that I mentioned are directed primarily at helping just such

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businesses. In addition, as noble Lords will know, the Government have announced very substantial rate relief of several different sorts for small businesses in rural areas. Undoubtedly, there is a serious problem here. However, it is not the Government's position that we are able--or, indeed, that we would regard it as sensible--to provide loss of income cover for all such businesses. It is not the Government's business to be the insurer of last resort. Therefore, there are bound to be problems of this nature following such a very severe agricultural crisis. I recognise that that is no great comfort to those businesses to which my noble friend referred, but I believe that many of the measures currently in place will provide at least some comfort for a range of such businesses, and that they will also provide the basis for a rural revival once the disease has been eradicated. We must make it clear to everyone that the prime objective of the Government is the rapid eradication of this disease, which will bring relief to rural areas.

Lord Howell of Guildford: My Lords, does the Minister accept that one further burden for those in the rural economy is that many homes, shops, streets and villages are still under water? Those people are suffering most severely from the horrors of finding their properties flooded, so much so that the noble Lord may have noted that an offer of food parcels and help for the suffering British rural towns and villages was received just the other day from Mozambique. Can the noble Lord tell the House what is the Government's strategy--not the tactical details--for ensuring that these appalling floods that have, on top of everything else, caused a great deal of suffering will really be tackled with a new vigour so that they do not continue to recur?

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