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Earl Ferrers: My Lords, perhaps I may ask the noble Lord a question because he made a very interesting and important statement. Can he say whether this inquiry will have the right to call people such as ex-Ministers and so forth and ask them directly what the questions were? As I understand the situation, one can have that with a public inquiry but not with any other form of inquiry.

Lord Whitty: My Lords, the inquiry will request the presence of whomever it wishes. Former Ministers have made it absolutely clear that they are prepared to give evidence to whatever inquiry is appropriate and established. So the answer is, yes, their evidence will be taken into account. The question of the precise procedure is a matter for these independent inquiries and their chairs.

That is the sad background of foot and mouth disease against which we have this debate. Of course many of the problems of, in particular, agriculture and parts of our countryside more generally predate foot

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and mouth disease but are now very much focused on the consequences of foot and mouth disease. It is true that farmers, particularly those with stock, in areas still subject to restrictions, as the noble Baroness, Lady Masham, made clear, are probably the most obvious victims of this. But there are a great many other victims--small businesses, tourism and other parts of the rural economy--which have suffered.

Perhaps I may deal first with the agricultural sector. It is appropriate and timely for us to take a long-term view of the future of agriculture. The Government are being asked for clear signals. We have established the independent Policy Commission for Food and Farming under Sir Don Curry. It is intended that the commission will mark the first step towards producing a new consensus on the future of food and farming in this country. At present there is no consensus. Indeed, even in our discussions today many different views have been put forward. The noble Lord, Lord Beaumont of Whitley, saw one future in which all agriculture shifted to small farms; the right reverend Prelate the Bishop of Hereford put all his money on organics, which somewhat offended the noble Lord, Lord Taverne. Even in this House, all shades of opinion and view are held.

Perhaps I may underline what was said by the noble Baroness, Lady Miller of Chilthorne Domer. "One size fits all" is not a solution for agriculture. The common agricultural policy, which in effect adhered for most of its existence to such a policy until the most recent reforms, now finds that it is no longer appropriate, either in Britain or in Europe.

The Lord Bishop of Hereford: My Lords, I am grateful to the Minister for giving way. I have to say that I do not put all my eggs in the organic basket and I agree with much of what was said by the noble Lord, Lord Taverne, on that subject. I am far more keen on pursuing long-term strategies addressing integrated crop management. Perhaps the Minister misunderstood what I said.

Lord Whitty: My Lords, I beg the pardon of the right reverend Prelate. I was too much taken by his advocacy of Hereford organic cider. I became completely carried away.

As I have said, we do not have a consensus on the future of agriculture. I think that it is important to put agriculture into context, as did my noble friend Lord Judd at the beginning of our debate. Instead of seeing agriculture as an activity subject to environmental pressures, the future of agriculture both for its landscape and production should form part of a broader environmental and rural economy, both in its processes and in its context. For that reason, we need to look at our methods of food production.

I would take issue with the noble Earl, Lord Ferrers, when he said that the Government take the view that the production of food is not important. That is not our view. I have stated that several times, both in this House and elsewhere. Indeed, I was grateful to the noble Lord, Lord Palmer, who saved me from having to quote myself in the course of my remarks. I and my

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right honourable friends the Prime Minister and the Secretary of State have reiterated our wish to see a viable, sustainable, diverse food production industry in this country, embracing livestock and arable, as well as horticulture, if it is not already covered by arable farming. However, the noble Lord, Lord Mackie of Benshie, pointed out that that industry already stands on its own two feet and has a great future.

We want to support all sectors of agriculture, but they are subject to change. They are subject to change in the nature of subsidy, in consumer demand and from environmental pressures. Agriculture is always changing; it does not remain the same. It has changed since I was a child and in 10 years' time it will not be the same as it is now. That will be the case irrespective of CAP reform or individual government policies. We need to seek other outputs for current agricultural activity. Some of those are close to agriculture, such as the advocacy of the noble Lord, Lord Palmer, for biofuels. I share his enthusiasm for those developments. Biofuels and other industrial uses for crops form an important part of the jigsaw which I hope that the Policy Commission on Food and Farming will address.

We need to look also at diversification into the wider rural economy. It is important that we recognise that food production comprises only a part of the equation, albeit an important one. How self-sufficient we should be in food is now perhaps an old-fashioned question. I certainly do not agree entirely with the implication of the noble Lord, Lord Skidelsky, that it is the most important question. We produce nearly two-thirds of our food ourselves. The noble Lord, Lord Palmer, stated that 80 per cent of the food that can be grown indigenously is produced by our farmers. That is a remarkable record. Whether it is the right figure is a matter of contention. But it is not the only issue. More important is the question of how we should utilise the assets of the nation's farming skills and experience, as well as our landscape, to maximise their benefits for the population as a whole. Part of that question concerns food production, part concerns landscape, part concerns recreation and part is agriculture-based but covers diversification into other activities in our rural areas.

The traditional forms of agricultural support are more than creaking; they are breaking down. CAP reform is central to our strategy. It should be the aim of us all to see that the CAP is altered from its present basis--aid offered largely in the form of production subsidies, albeit changing types of subsidy--to something which supports the rural economy as a whole. I was surprised when a noble Lord commented that Margaret Beckett has not been prominent in this effort. She has strongly advocated the point that our central aim must be to focus on the negotiations covering the mid-term review of the Agenda 2000 aspect of the common agricultural policy. Serious negotiations on that will begin by the middle of next year. In the long term, we seek a complete change in the policy.

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The CAP is not the only way in which taxpayers' money has been put into farming over recent years. The noble Lord, Lord Plumb, and others asked about agri-monetary compensation. Over the period of this Government, we have committed £1.7 billion, including about £700 million of agri-monetary compensation, over and above the contribution made by the CAP. Whether we go further on that at this juncture is a matter for pause; we are now considering the matter further. Clearly a great many other pressures are being exerted on the Exchequer. Whether further compensation is the best use of taxpayers' money at this point is something to which we must return. For that reason, I cannot give the commitment which I believe the noble Lord, Lord Plumb, was looking for.

Furthermore, I cannot give immediate commitments on other aspects, including the regional development pillar, a matter referred to by the noble Baroness, Lady Miller. The size of the UK allocation from the RDP has been disappointing and we are working on that. We want to broaden the scope of projects and expenditures that can be met under that heading. Changes can be made, even without complete radical reform of the CAP.

Diversification also forms a part of the jigsaw. Complaints have been made about the burden of regulation and planning restrictions. The noble Lord, Lord Kimball, spoke of planning restrictions which affect diversification of agricultural enterprises. I would ask the noble Lord to wait for a week or so, at which time my noble and learned friend Lord Falconer will have something to say publicly on that matter. Obviously it is an issue which needs to be addressed.

The longer-term recovery of farming has to be seen in a wide context. Sir Don Curry's commission will play a major part in that. Broader rural recovery depends on the Government completing the process initiated by the publication last November of the rural White Paper, to which my noble friend Lady Gibson referred; namely, consolidating policies for market towns, rural transport and affordable rural housing. This last point was taken up by several noble Lords in their contributions. The social dimension of the recovery of the countryside is just as important as the purely economic and agricultural dimensions.

Tourism now forms by far the biggest rural industry and is one that we must seek to sustain. By that I do not suggest that we move from agriculture subsidy dependency to tourism subsidy dependency, but a little help along the way may be given to businesses to help them to become viable in the medium term. My colleagues in the Department for Culture, Media and Sport have given their full support to the tourist boards and other interested groups currently examining the issues.

In the immediate and more local context, tomorrow will see the publication not only of the report of my noble friend Lord Haskins--I am grateful that my noble friend Lord Campbell-Savours has given an unreserved and totally blind commitment to its

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conclusions--but also of the wider report from the Rural Task Force. It will deal in particular with the worst-hit counties of Cumbria, Northumberland, North Yorkshire and Devon. I would prevail upon noble Lords to await the outcome of that report. It will form an important, albeit short-term, indication of the Government's commitment.

We need to develop the tourist industry, just as we need to develop rural businesses as a whole. Furthermore, we need to address the particular problems of the countryside. However, let us not write off the countryside as a failure. Before the foot and mouth outbreak, large sectors of the rural economy were doing relatively well. It is not true to say, except in the remotest areas, that rural England is becoming depopulated. In some cases, the opposite is true and it can be a problem. Businesses and people are moving into rural areas at a rate which sometimes those areas find difficult to accept.

There was a prosperity in much of rural England. We hope to get back to that position quickly. We believe that we can. We already are in many of the areas which were not seriously damaged by foot and mouth.

I was surprised when the noble Lord, Lord Selsdon, reminded me that the House of Lords I entered four years ago was full of peasants. His description of the social origins and the social basis of rural England is partially true, but nevertheless it is a little limited because every profession now lives in rural England: farmers, certainly; agricultural-related trades, certainly; tourism, certainly--but every single profession now lives in rural towns and rural villages. We are more one country than many people think. The rural part of this country has been hit hard in recent months and we all have a responsibility to help it, but in the long run we all face the same problems.

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