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Lord Sheldon: My Lords, since the golden rule is the yardstick by which taxation and spending are brought broadly into line over a certain period, does my noble friend accept the view of the Institute of Fiscal Studies, part of which he quoted, that the outcome could be even better than the Treasury expected? That is a rather surprising change of attitude by the Institute of Fiscal Studies. Will he confirm that he holds that view as well?

Lord McIntosh of Haringey: My Lords, the Institute of Fiscal Studies is simply recognising that the Treasury works on very cautious assumptions. For example, its estimate of growth for these purposes has consistently been 0.25 per cent below its own central view. That caution has been expressed for many years now since the current framework came into place.

Baroness Noakes: My Lords, we are not surprised by the Minister's first response, which was to deny the view of the Institute of Fiscal Studies that there is a black hole in the Government's finances. In that case, the Minister will not find my question very difficult. Will he deny that the Government have no plans to raise national insurance contributions after the election?

Lord McIntosh of Haringey: My Lords, I deny that there is a black hole and I refuse to make any forecasts other than those that the Chancellor of the Exchequer will make in his Budget, which will be before any date of an election.

Lord Tomlinson: My Lords, as my noble friend does not want to get engaged in hypotheses about the future, would he perhaps care to look at the record over recent years and say whether the performance of the Government is a substantial improvement on what happened under the previous administration, particularly in relation to Black Wednesday, the details of which are now coming out and will be subject to full public view?

Lord McIntosh of Haringey: My Lords, I could give 20 or 2,000 answers to that question. There are so many
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ways in which the economic performance of this Government is better than that of the previous government that I have an embarrassment of riches. If I were to take only one of the Opposition's favourite measures—what they call the tax burden—I could point out that the tax burden in 1979 to 1997 was 40.6 per cent of GDP. We have got nowhere near that.

Lord Newby: My Lords, does the Minister accept that the Treasury, within the past 24 hours, has shown a reluctance to release forecasts made at the time of Black Wednesday on the basis that it could set a precedent for information about current forecasts? Would it not be sensible for the Treasury to accept as a matter of policy that whenever forecasts are made available to Ministers, bearing in mind that these are forecasts not policy recommendations, they should be made public at the same time?

Lord McIntosh of Haringey: My Lords, my understanding is that the Treasury's actions have been fully in accordance with the Freedom of Information Act.

Lord Northbrook: My Lords, how can we trust the Government's borrowing figures when the prediction for the public sector current balance has been out by on average £10 billion per year over the past four years?

Lord McIntosh of Haringey: My Lords, I am not asking the noble Lord to trust any figures. I am simply pointing out that Treasury forecasts have been consistently better than the average of independent forecasters. Let us go on evidence, not on trust.

Lord McKenzie of Luton: My Lords, can my noble friend tell me what the IFS Green Budget report has to say about the rise in national income after tax under this Government compared with the previous government? How does the percentage of national income taken in tax under this Government compare with the average taken under the previous government?

Lord McIntosh of Haringey: My Lords, I do not have all the answers to those questions, but I do know that since 1997 national income after tax under this Government has risen by 2.6 per cent in real terms. I understand that that is a faster rise than that achieved by the Conservative government. However, I shall have to write to my noble friend with the precise figure.

Sustainable Farming and Food

2.51 p.m.

Lord Livsey of Talgarth asked Her Majesty's Government:

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The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Lord Whitty): My Lords, The Strategy for Sustainable Farming and Food is a comprehensive, long-term plan for the future development of the industry. Much progress has already been made through, for example, the implementation of the 2003 CAP reform deal, the launch of new agri-environment schemes, successful pilots for the Whole Farm Approach, the launch of the Animal Health and Welfare Strategy and helping the food chain as a whole to improve competitiveness by supporting initiatives such as the Food Chain Centre and English Farming and Food Partnerships.

Lord Livsey of Talgarth: My Lords, I am sure that the Minister will agree that the Curry report is only one of a number of strategies available to the Government. I refer also to the rural White Paper, the Haskins review and the rural delivery review. Which of those strategies takes priority and how do those concurrent policies mix with the Curry report itself? Would he please clarify the situation?

Lord Whitty: My Lords, I am surprised that the noble Lord seeks clarification. The food and farming strategy relates to the development of the food and farming industry while the rural strategy relates to the broader prosperity and well-being of rural communities. While there is an overlap in part, both strategies are being pursued with vigour, and I hope to make an announcement relating to the rural strategy very soon. We are conducting a coherent policy to address our rural responsibilities and those for the food chain.

Earl Ferrers: My Lords, can the noble Lord, Lord Whitty, explain how the Government's determination to develop agriculture—I believe that he referred to the development of agriculture—coincides with the fact that the agriculture sector is becoming less productive and less rewarding?

Lord Whitty: My Lords, the agriculture sector is not becoming less productive. Its efficiency and productivity have improved significantly. Although a slight downturn in income was recorded last year, that followed three years of substantial increases in income, albeit from a very low figure for 2000. Noble Lords will know that agriculture was deeply affected by both the exchange rate and subsequently by the outbreak of foot and mouth disease. Agriculture has made a significant recovery, but it has a long way to go. Part of that recovery is improving its relationship with the rest of the food chain, which is exactly what the Curry review and the strategy are about.

Baroness Trumpington: My Lords, does the Minister agree that, although some people may have benefited, the question of whether one has made money or seriously lost it depends entirely on what type of farming one is involved in?

Lord Whitty: My Lords, agriculture is a diverse private sector industry, albeit that there is a strong
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public ethos of support for it. There will be winners and losers. Substantial restructuring has taken place in agriculture, resulting in larger units and the departure from the sector of a significant number of smaller operators. Although that may have been distressing for some people in some areas, by and large the net effect of that restructuring has been to improve the efficiency and long-term competitiveness of the industry.

Lord Hylton: My Lords, what are the Government doing to remedy the decline in self-sufficiency in temperate foods in this country? Will he also give special mention to biofuels and oilseeds?

Lord Whitty: My Lords, the development of biofuels, which I strongly support and hope to see measures brought forward in support of, does not count towards the food balance because, by definition, they are non-food. Biofuels have the potential to be useful and profitable adjuncts to the agriculture sector.

Turning to self-sufficiency in food, we are still 74 per cent self-sufficient in products that can be produced in the UK. Virtually no other industry achieves anything like that level of self-sufficiency. Although the percentage has come down a little over recent years, it is still substantially better than it was in the 1930s or, indeed, during most of the previous century.

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