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Lord Hoyle: My Lords, I am sorry to remind the noble Lord of this--we are enthralled with what he is saying--but there is a seven minutes time limit for each speaker.

5.20 p.m.

Lord Marlesford: My Lords, I found the speech of the noble Earl, Lord Ferrers, one of the most powerful I have heard in 30 years of listening to politicians in both Houses. I declare an interest as a farmer, including having a dairy unit, and as someone who has drunk milk direct from the bulk tank all my life.

This Government were elected with an overwhelming mandate from all parts of the country, including many rural areas. I, like many others from different parties, believe that they deserved to be elected and, in the interests of the country, I wish them well.

As with any government, the quality of Ministers is variable but I would like to say that I believe that Britain's farmers are fortunate in having at MAFF a Minister with the political experience and intellectual calibre of the noble Lord, Lord Donoughue.

In many areas the Government are doing the right thing and with courage. However, when it comes to the countryside interest, I fear that the Government are not only disappointing their rural constituency but disillusioning them, and in some cases infuriating them.

First, as we have already heard from many noble Lords, the agricultural sector, which since the war has had an unequalled record of productivity increases, is suddenly, through no fault of its own, facing financial disaster. What a condemnation that is of the CAP, which was designed specifically to avoid such situations. Unfortunately, the Government have not yet given farmers the feeling that they understand, let alone sympathise with, the farmers' predicament. Secondly, in the Government's ambivalence towards the hunting issue--I take no side on it--I fear they are getting the worst of both worlds. They are seen as wet by the "townies" and anti-country by those who live in the country.

Thirdly--this is to me the most important, as chairman of the CPRE--they seem indifferent to the protection of the countryside, which had been one of the two great triumphs of the post-war Labour Government. I refer of course not only to their unrealistic targets for the construction of up to 5 million new houses in England and Wales by the year 2016, at least half of them in rural areas, but also to their apparent readiness

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to sacrifice the green belt to do so. I hope very much that we may shortly have the opportunity of debating this issue in more detail in your Lordships' House.

But I wish to focus on BSE. The Government seem to be continuing the deplorable record of the previous government. Both governments have exaggerated risks, and the taxpayer and the farmer are now paying for that exaggeration. What went wrong over BSE? In essence, it was, and I fear still is, a confusion between the role of Ministers and that of advisers. As was famously said in 1989 by the then Prime Minister, my noble friend Lady Thatcher, "advisers advise and Ministers decide". That of course is why Ministers should resign when things go wrong--not because they are personally to blame, but because it enables their successors rather than the advisers to make the crucial decisions of government.

The first person to get this publicly and badly wrong in the early days of the BSE scare was Mr. Stephen Dorrell, the then Health Minister. I shall never forget the morning I heard him say on the "Today" programme, "We will act on the best advice". The interviewer said: "If the experts advise you to slaughter the entire national herd, would you do so?" His fatal reply was, "We shall act on the best advice". Within the hour the news headlines were, "Cabinet Minister envisages slaughter of entire British herd". How the hearts of the French must have leaped for joy. The ever glowing embers of schadenfreude burst into flame, a flame which is burning as brightly as ever.

The latest 1997 government estimate is that over the four years 1996-97 to 1999-2000 the financial cost of the BSE crisis to the Exchequer--that is, to the taxpayer--is £3.7 billion. Three thousand, seven hundred million pounds. To get that into perspective, let us remember that in 1997 the entire British contribution to the CAP was some £4.3 billion. And what have we got for this £3.7 billion? How many lives have been saved? How many lives have been lost to CJD? With every hospital in the land looking out for CJD--it is almost a triumph to find a case--I believe that the total death toll is still under two dozen. And the cause and effect between BSE and CJD is still not proved. What is the opportunity cost of that vast sum of money--in the treatment of other diseases of the heart, the kidney, cancers and those terrible killers such as Alzheimer's and motor neurone disease? That is forgetting what could be done for the Government's other main priorities, education and law and order.

And the present Government are following closely in the same path. It was only on 6th December last that Mr. Cunningham announced, on the best advice of course, that British beef could no longer be sold on the bone. In Europe the flames of joy rose higher still. At home the people did not know whether to laugh or cry. Butchers covertly defied the ban by selling beef as pork. Unenforceable law is bad law: it brings all law into disrepute and thus erodes public morality.

And has all this got British beef back into Europe, or anywhere else? We are told that the Council of

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Ministers may, just may, shortly allow beef from Northern Ireland back on to the Continent. One is reminded of Stalin's quip, "The Pope! And how many divisions has he got?" Let us be clear: BSE is still with us. The latest figure I have is that in the 52 weeks to 14th November last 5,684 new cases were reported, an average of 109 per week over the year. The figure will fall away to nothing, and would have done so much faster had the Conservative Government not waited until 29th March 1996--yes, 1996--before prohibiting the production of pet food (in which mammalian meat and bonemeal may still be incorporated) in the same premises as feed for farmed animals, thus very belatedly eliminating the main source of cross-contamination. That fatal delay was indeed a failure of the advisers.

It is seldom worth paying Danegeld. I urge the Government to review these BSE expenditures and allow the disease to burn itself out. Only then will our beef be allowed into Europe. The money saved could be used so very much better.

5.27 p.m.

Baroness Strange: My Lords, we are all grateful to my noble friend Earl Ferrers for initiating this most important and timely debate, and for the brilliant, fascinating and funny way in which he did so. We were all spellbound. Today I have seen the noble Lord, Lord Parry, cross the Floor of the House to congratulate him. If I could have climbed down from these Benches without personal danger to other noble Lords or myself in order to congratulate my noble friend, I would have done so. To listen to him is always a pleasure. To join in a debate of my noble friend's, however humbly, is a signal honour. I wish also to congratulate the Minister, on whom we farmers have to rely. I believe that he will not let us down.

I must declare an interest in that I am a farmer, though at present not a very active one. However, like my noble friend Lady Trumpington and many other noble Lords, I have personally picked and planted potatoes from a sack round my waist, one by one, milked cows both by hand and machine, and driven a tractor though not a combine. I stooked corn during the war (and have not yet found the sleeves which thistles could not penetrate). I have also looked after hens, picked small fruit, and picked and sorted pears, apples and plums. Indeed my noble friend Lord Onslow is to my knowledge a very expert plum sorter. I have also ploughed with a one-furrow horse plough, though not a very straight furrow. So I have some practical knowledge.

I also helped my noble father on his wartime book on agriculture, Charter for the Soil, in which he outlined the future importance of combine harvesting, supermarkets and direct farm marketing. He also advocated farming groups with their own farm slaughterhouse and resident scientist. He was also organic, and farmed with compost. Many of his ideas have been put into practice since 1944 when the book was published.

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So much good sense has been said by so many noble Lords that there is little for me to add except by agreeing with most of them. But I would quote the old rhyme:

    "For want of a nail the shoe was lost, For want of a shoe the horse was lost, For want of a horse the battle was lost, For want of the battle the kingdom was lost And all for the loss of a horseshoe nail".

Our GDP derived directly from agriculture may be only 1.4 per cent.; it may directly employ only 2 per cent. of the total workforce in employment; but from these small nails the whole kingdom is built up. A large infrastructure of jobs and people is supported by agriculture. In many underprivileged rural areas hill farms are often the only employers, the only alternative being for people to "go on the welfare". Our countryside, with its hedges, small fields and differing landscape, which so attracts tourists and makes Britain such a marvellous country in which to live, is only as it is because of our farmers and the way they have managed and nurtured the land. Let us not throw our farming land away for a mass of concrete linked by golf courses and leisure centres. Our countryside is one of our greatest assets; it is the heart of Britain itself.

5.32 p.m.

Baroness Young of Old Scone: My Lords, I add my congratulations to those which have been expressed to the noble Earl, Lord Ferrers, for the magnificent way in which he introduced the debate. He presented his case with considerable elan, though, as he knows, I may not agree with all of it.

I too wish to stress the importance of farming and agricultural policy. We depend on farmers for safe and wholesome food. They are also stewards of the countryside, which is a resource for the whole nation, not only for those who live and work there. The common agricultural policy has probably been the major cause of the decline of birds and biodiversity in the countryside over the past 30 years.

Listening to the catalogue of concerns expressed during the debate, it would be easy to be plunged into deep depression. I trust that the Minister does not think that that will be true of the whole debate, because I should like to offer two reasons for some encouragement.

I recognise that trying to sell products abroad when the pound is strong is very tough, but that is true for many other businesses. One of the features of farm incomes is their volatility. Farm incomes and land values were embarrassingly high during the period from 1992 to 1996. There was a weak pound and we saw high world prices, and it is only from those high levels that we have seen declines in the past couple of years. I believe that some of the high percentage declines in those two years over-represent the case.

Farm-gate prices do fluctuate and the inevitable consequence of "moving closer to the market" means that fluctuations are not cushioned by subsidies and so will seem more extreme and possibly less predictable. This is part of operating in a real market, which is what I understand many UK customers are calling for.

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There are, of course, differences between the sectors. For arable farmers, subsidies during 1992 to 1996 were over-generous. The proposals under the common agricultural policy and Agenda 2000 will do nothing to reverse that and indeed will modestly increase incomes, mainly through the loss of the set aside provision and compensation for price cuts. Though world grain prices are currently low, long-term trends are growing global demand and increased production to meet it in the major grain exporting countries. We are likely to see continuing fluctuations and volatility in prices.

Dairy farmers have consistently done well following the introduction of quotas since 1984 and those quotas are likely to remain until at least 2006. It is beef farmers for whom we should have considerable sympathy. The continuing export ban is biting hard. That ban, together with the strong pound, the fact that domestic consumption of red meat is dropping and the long-term history of low incomes in the less favoured areas, give cause to worry about the beef sector.

That brings me to my second reason for being more optimistic than others who have spoken today. By taking action in the beef sector the Government have made considerable progress in gaining confidence in Europe, which will eventually lead to relaxation of the ban. The BSE issue is not one of risk but one of confidence within Europe about our ability to act sensibly and responsibly and to move forward cautiously. The rigorous approach of the beef-on-the-bone decision was necessitated by the need to build confidence in Europe and not based on the issue of risk.

Because farm incomes do fluctuate over the years, I believe that we should look at ways of using the situation to move forward in agricultural policy rather than simply seek compensation for the strong pound through the agri-monetary provisions. Such fluctuations in incomes will be a standard part of a market system in the future. What is needed is not a sticking plaster for the current ills but a restructuring of the farming industry. We need new structures and technologies to make it as efficient as possible and to sort out the issues of production which depend on the market. We then need a sensible common agricultural policy, sensibly implemented in this country, to support the things that the market will not deliver: social support in the uplands for small farmers and support for the environment.

Let me say why I am more confident of the way forward than other speakers and why I am encouraged in my belief that the Government are addressing the fundamentals of agricultural policy reform. I have already spoken about the progress that has been made on the BSE issue. We are now a credible player in the European Community, which we were not under the previous government, not just in the agricultural field but also in our whole presence in Europe and particularly during our presidency. We have seen the establishment of the food standards agency which is aimed at promoting confidence among consumers in this country, which I believe had been lost. I should declare an interest. Whereas some have expressed anxiety about the new structures for advice in MAFF, I believe, as a member of the Minister's advisory group, that the opening up of advice in MAFF is long overdue. The

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advisory group may not be totally representative but it is accompanied by a plethora of ways of taking advice from a wide sector of communities, not simply the agricultural community.

There remain a number of matters that the Government need to address. I conclude by outlining two. One is the rural development agencies issue, which many have already touched upon. I add my voice to the call for there to be representatives of the countryside on those agencies. The second is the need for faster progress in this country with the introduction of well developed and funded schemes under the agri-environment conditions to support farmers, particularly upland farmers, who are in great difficulty delivering not only for rural communities and agricultural production but also for the environment.

5.38 p.m.

The Earl of Clanwilliam: My Lords, I rise with some trepidation to speak in this debate. I am not a farmer but I do claim to have one attribute that may put me among a fairly select number of those in your Lordships' House as someone who has ploughed a field behind two shire horses. It was a great event, but, like my noble friend Lady Strange, I do not think I would have won a prize at an agricultural show; nevertheless, I did it.

Your Lordships have already been exposed to a range of statistics and, as an exponent of extensive farming, perhaps I may also add a few. The cost of fertilisers and pesticides is prohibitive and increasing. In 1996 we spent £823 million on fertilisers--up 27 per cent. on 1993--and £460 million on pesticides, an increase of 5 per cent. Machinery repairs, added to wages of £1.7 billion, make a total of over £4 billion being spent on 18.4 million hectares of farmland. That clearly demonstrates the importance of farming to the UK economy as well as what is to me, perhaps alone in your Lordships' House, a disturbing use of pesticides and fertiliser on our greatest and most important resource; that is, the soil upon which we depend for sustenance and which is our inheritance to pass on to future generations.

It is instructive to find that the MAFF-funded Scarab research programme on three ADAS research farms could find no long-term benefit to the environment from a 50 per cent. reduction in herbicides and fungicides. Starting from a base of that size, a reduction of 50 per cent. is hardly significant to the bugs and bees which are affected. The evidence of the organic farmer, on the other hand, demonstrates that farming can be successful and profitable by eliminating those poisons.

Much reference has been made to BSE. Perhaps the Minister can tell us something about the beef assurance scheme. A Starred Question is tabled for 9th February on that topic. The organic farmer has a clear record on BSE but is unable to restock his herds unless he can guarantee that he is buying from a BSE-free herd. The beef assurance scheme may solve that problem. Some difficulties may arise, in that it will be selective and possibly invidious to those who do not take part. However, it is important that it should be available.

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Great efforts have been made and results obtained with the increasing number of ESAs, SSSIs and the Countryside Stewardship and habitat schemes to which reference has been made by other noble Lords, particularly my noble friend Lord De Ramsey, who is now in charge of it all. Those schemes are a vital part of agricultural policy and have an important impact on the environment. They demonstrate again the importance of farming to the economy as well as to the environment.

Again I join others in regretting the demise of the Rural Development Council and the excellent work done by my noble friend Lord Shuttleworth. I need say no more in that regard. Governments past and present have failed to give positive help to organic farmers, whose cry is for only 5 per cent., rather than 100 per cent. of the land and who should be given positive support. It may be that if modulation comes along with Agenda 2000, the organic farmers may be the lucky recipients of some benefits and that may be to their advantage.

The importance of farming as an employer varies throughout the countryside. It is the constant increase in mechanical farming and automated tractor-drilling machinery which has slightly reduced its influence. The farmer is no longer the mainstay and the backbone of the rural community.

Finally, to some extent we are still masters of our destiny. We cannot control the common agricultural policy--I doubt that anybody can other than with the consent of the French and the Germans. But we are doing something in the extensification of our farming practices and, however that may be done, it will be to our long-standing benefit. I should like to see more organic farming to meet the demand of the housewife and the supermarkets. But however extensive farming is achieved, so long as it is so achieved, it will be well done.

5.45 p.m.

Lord Wise: My Lords, I am not certain whether or not I should declare an interest. Unlike many of my noble friends and the noble Lord, Lord Grantchester, I own only five acres--a smallholding--across which my generous friend and neighbour runs his cutter in the summer.

Like other noble Lords, I thank my noble friend Lord Ferrers for initiating this debate at this time. It is evident that British farmers and growers, whatever they produce, face severe difficulties and the industry generally is in a somewhat depressed state.

During the course of this debate many figures illustrating the position have been quoted and it is most disturbing that, according to the National Farmers Union, agricultural incomes fell by some 47 per cent. last year. Heaven forbid that that should continue, but if it does it is obvious that many farmers will go out of business, especially those in the more remote rural areas which are entirely dependent upon livestock. That will be disastrous not only for them, but for the whole rural economy and the environment. In those areas farmers

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are not only stewards of the countryside, but they are also the cornerstone of the social structure of the local community.

In the countryside, agriculture is one of the main sources of employment not only on the farms but in other ancillary trades which depend upon agriculture for much of their business. Any downfall in farming has an adverse effect on all those other trades and at the very least must create more unemployment.

At the demonstration yesterday I saw the youngster carrying the placard saying, "Please don't take away my farming future". That placard illustrated not only his fear, but also the fear of his parents. Like the right reverend Prelate, I am concerned that farmers' sons and other young people in farming families are becoming more and more disinclined and no longer interested in embarking on a farming career. I suppose they feel that the hard graft and long hours are not worth it and that they could occupy their time more profitably in other ways.

If those young people move elsewhere, it must inevitably lead to the withering away of rural communities. The village shops, schools, bus services and so forth will all disappear. The Government are considering "right to roam" legislation. Without a stable agricultural industry, the countryside would be a far less beautiful and pleasant place in which to roam.

Agriculture plays an essential environmental role in providing both amenity and nature conservation. In order that that may continue, the Government must play their part. They must ensure that we can compete on fair and equal terms with other member states. All farmers, whatever they are producing--be it beef cattle, dairying, arable production or fruit--will face real hardship unless they are put on an equal footing with their competitors in other member states. Our produce is as good, if not better, than others, but, as has been so vividly described, it is essential that we have a level playing field.

From all that he hears this afternoon, I am sure that the Minister will be in no doubt as to what the industry needs and what the Government should be doing, so I will leave that point. However, I have one other small plea. The Minister is not in his place at the moment but he will be pleased that the matter is not too serious. I want to ask him to use all his influence to ensure that one age-old rural craft can continue. I understand that there is a European directive that, after slaughter, all sheep's heads should be incinerated. I do not disagree with that. I am sure we will comply with that regulation, as we comply with all the regulations though I am certain that we are the only state that does. Can the Minister have this amended to allow the horns on the heads to be removed before incineration? This would enable the age-old craft of making shepherd's crooks, using the horns of sheep such as Swaledales, to continue. Not only are the crooks very useful--I have used them a lot in the past--but they are useful tools for shepherds. They are also sold at sheep fairs, as they are decorative and make excellent walking sticks and they are a source of income to the craftsmen who make them. It would be an awful shame to lose them. I look to the Minister to ensure that we do not.

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5.50 p.m.

The Earl of Bradford: My Lords, like so many speakers, I declare an interest as a farmer and landlord of a number of tenanted farms. I also add my congratulations to my noble friend Lord Ferrers, who robustly, as always, put the case.

We have heard many excellent speeches about the important role of agriculture to Britain. I would not wish to add to the mass of information but rather would attempt to highlight the oft-forgotten human cost to the farmer. Sadly, particularly in this marvellous, modern new age of agriculture, the pressure on the farmer is enormous, especially on one farming only a small acreage. And the life--contrary to the image of it being a highly social one, as portrayed by the Young Farmers' clubs--tends to be both arduous and very often extremely lonely.

While many stressful ingredients have always existed, such as remoteness, a sparse and scattered population, the mental effects of working extremely long hours and, in effect, being on call 24 hours a day, 365 days of the year, recently other factors have influenced the situation. The first is a public lack of appreciation of agriculture, especially by newcomers who see farmers as spoilers of land, as vandals who rip out hedgerows or as killers of animals. Particularly unfortunate is the widespread misunderstanding of the necessary role of farming in preserving the countryside. All of this has been complicated further by changing government policies and the remoteness of European decision making.

The second factor is that too many farming families exist on the economic breadline. Most farmers, if they were able to calculate their income in relation to the hours that they work, would consider the level being discussed for the minimum wage merely a pipe dream for them.

Over the past five years there has been a growing awareness that the problems and pressures facing those in our rural communities are increasing and becoming unbearable for some. This is supported by official statistics, which show that the rate of suicide among male farmers, farm managers and horticulturalists generally runs somewhere between 1.5 and 2.1 times the average for the general public. They also show that suicide is the second highest cause of death among male farmers between the ages of 15 and 54, and that in the case of farmers' wives the rate is 20 per cent. above average. Between 1982 and 1992 there were 589 recorded suicides in the farming community, an appalling rate of over one death a week.

That figure may even be on the low side, as very often farmers are known personally by the coroner, and there is a natural reluctance to deliver a verdict of suicide, particularly if there is a question of life insurance. Currently there is anecdotal evidence from both the Samaritans and the Rural Stress Information Network that the level of despair and desperation has increased further, especially since the recent ban of beef on the bone. Remarks like, "If they take my herd, they can carry me out with them" or "If my farm goes under, then I'll go with it", have become commonplace. Another sad fact is that members of the farming community have the

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means to end their lives always close at hand, statistics showing that over two-thirds use a firearm or hang themselves. Given the fact that suicide is very often a lonely person's plea for help, these means are too immediate and too final. No stomach pump can save them.

So, my Lords, we must always remember the human cost of government decisions affecting the farming community. It is vital that we take into account--while agriculture has made huge strides towards the once seemingly impossible goal of self-sufficiency in this country--that so many lack what would be considered a normal social life and the huge personal sacrifices that some have made in the cause of achieving success.

5.55 p.m.

Lord Alderdice: My Lords, I join other noble Lords in congratulating the noble Earl, Lord Ferrers, on initiating this debate. In my relatively short time here I have come to associate with all his speeches some of the best characteristics of style of your Lordships' House. They are always well informed and come from experience, with a certain flamboyance and flair, and all rebuttals of his opponents' arguments are conducted with courtesy and a sense of good humour. Indeed, it seems to me that in his speeches--we saw it again today--he exemplifies some of the things that are best in your Lordships' House and which are almost impossible to find in any quantity in other places.

The noble Earl's approach was well rooted, which is what one would expect in a debate about agriculture, but was informed more by that solidity of understanding of the real world than by political spin and gloss, which has been one of the biggest problems of recent times. I come from a medical background. I often find it deeply frustrating to be given apparent information about what is good for us and what is bad for us and particularly regarding what might be dangerous to eat as though it is the last word, the absolute truth, thoroughly well founded and with a considerable scientific backdrop. When I do know something about this information, or when I am led to know a little about through my pathologist wife, I find that things are nothing like as well evidenced, that it is not so much scientific evidence as media hysteria. This generates great anxiety in the community and there are almost inevitably disastrous consequences. What is deeply unfortunate is that in the past two or three years government have not rebutted this or stood against it; they have not encouraged people to look at the question more broadly and over a period of time; but, through fear of being criticised for holding back, they have responded in a knee-jerk fashion and then spent the following 12 months trying to roll back the position, at profound cost to the community at large and to individuals--farmers, traders and others.

Many noble Lords have spoken with great erudition about the general matters of importance for agriculture and the economy of the United Kingdom. Noble Lords have emphasised the hills of Wales, the Highlands of Scotland and the broad green fields of England. It therefore falls to me to say something about the position in Northern Ireland. I do not come from a background

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of broad acres but both my father and grandfather came from small hill farms. That is the case for many people in Northern Ireland. We are an agricultural community and few of us are far distant in geography or generations from the land and farming. Agriculture is an important part of the economy. Indeed, it is much the largest industry in Northern Ireland. While in the rest of the United Kingdom around 2 per cent. of the population are employed in agriculture and related industries, in Northern Ireland the figure is around 7 per cent.

Almost 15 per cent. of our exports, such as they are, are agricultural--or were, until the BSE crisis. For us, the industry is absolutely critical. In recent times it has been made even more so. Believe it or not (and one hesitates to describe them) there are such things as "negative peace dividends". For example, if one is employed in the security forces, the fact that there is going to be peace probably means that one's job is not as secure as it was when there was trouble. We are glad to see that; but if one's job happens to be in the police, the glass industry or something of that sort, it is not necessarily in one's immediate self-interest.

We have seen another kind of development in recent times. As peace has developed and confidence has grown in general terms, we have seen the arrival of the big supermarket chains such as Sainsbury and Tesco, which avoided the troubles of Northern Ireland for 25 years. They now provide a tremendous service to the consumers of Northern Ireland. But the downside is that, last week alone, two of our longest serving bakery firms with small home bakeries throughout the community went into bankruptcy. We are also not finding the local sourcing of materials for which we had hoped with these big, and in many other ways helpful, supermarket chains.

The Government have also indicated something like a 2 per cent. cut in public sector funding in Northern Ireland over the next three years. That will mean a cutback in the number of jobs in general, apart from those associated with security. For a community where the employment of 50 per cent. of people is in some sense connected with the public sector, that is a serious matter. So for Northern Ireland agriculture is becoming more, not less, important.

That is why, when we had our own devolved parliament and had some control over agriculture, enormous efforts were made to ensure that our agriculture was of the highest possible quality; and we were able to use the relative isolation of being part of an island to ensure a degree of quarantine and protection for the purity of our agricultural products and stock. Indeed, as is now well known--although I do not believe it was well known until the BSE crisis arose--our computerised tracing scheme ensures that we certify herds in a manner not available anywhere else in these islands or in Europe. We had focused on that system. It was therefore a deep disappointment when we discovered that we were to suffer the same fate as the rest of the United Kingdom in relation to the BSE crisis. No matter how much effort we had made, it was to be forgotten about--because the previous government felt that if one part of the United Kingdom was given a chance, the other parts would be left to one side. That

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was a misjudgment. If Northern Ireland had been allowed, under a pilot scheme, to ensure that at least one part of the United Kingdom was not excluded, it might have been more possible to include the rest of the United Kingdom. That is why I welcome the decision made by the current Administration that Northern Ireland can move forward--not, I hope, as an exemption or a case for special pleading, but as a pilot for the rest of the United Kingdom by re-entering the export market.

I conclude with three brief comments. First, we do not ask for special pleading for any parts of the United Kingdom, but we have our special places, and let us not ignore that. Secondly, let us not be hysterical about BSE or any of the other food issues. They will continue to arise. Let us be more thoughtful and solid, as is your Lordships' House. Finally, in agriculture things cannot be changed around so quickly. It is rather like an oil tanker: it cannot be turned around with a snap of the fingers, or turned off and on like many other things. Time must be given for any changes that are necessary. Time should be given to our farmers and to those who depend on them, in Northern Ireland and throughout the United Kingdom.

6.4 p.m.

Lord Rotherwick: My Lords, I must declare an interest as a farmer, like many other noble Lords. I gained a diploma in agriculture in 1982 and became a working farm manager of a large, mixed farm. More recently, I have been farming in my own right.

One must congratulate the Minister on the creation of a "new independent group" to advise on key food, agriculture, environmental and rural policies. Sadly, as my noble friend Lord Peel said, only three out of the 11 people on this group have any connection with agriculture and only one of them is a farmer. It seems that he is in this group because he is a director of the FWAG, which is indeed a very worthy organisation. One might, therefore, not be wrong in having some concern that their forthcoming reports would place the environment and rural policy before agriculture and food. In other words, the tail would wag the dog.

Can the Minister explain why such bodies as the NFU and the CLA, which represent the bulk of farmers and landowners, are not in this group? The NFU's primary goal, in which it has succeeded, is to ensure that farmers can continue with the important task of providing the bulk of the nation's food whilst maintaining a healthy rural economy and protecting our beautiful and diverse countryside.

Today's agricultural industry produces nearly 60 per cent. of the food consumed in the United Kingdom, which is more than ever before. The UK's total food trade deficit has stabilised at around £6 billion from a high of over £10 billion. Last year agriculture produced a turnover of £17 billion, employing 2.4 per cent. of the nation's workforce and many others indirectly. That is more people than are employed in transport, in post and telecom services or in the energy and water supply industries. Agriculture accounts for 1.5 per cent. of the country's GDP. Agriculture is a most important industry

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and one of the few that has produced a product for its consumer that sells, at the farm gate, for less today than it did a decade ago. This is even more remarkable when one considers the restraints that have been imposed on the industry.

Today, like most farmers, I am very angry at the position that the EU has put us in. When I started farming a decade and a half ago, my average feed wheat yields were around 6 tonnes to the hectare; they have now risen to 9 tonnes a hectare. The average price that I got for feed wheat was £115 a tonne; that has now declined to £85 a tonne. I have reduced my workforce from 12 to three employees.

On top of that the red tape and constraints mount each year and, combined with a very unlevel playing field, the agricultural industry now needs to receive area payments to continue farming. It is the policies of the Government and the EU that have put the agricultural industry in this awful position. If the UK were not the most efficient and one of the best producers of the highest quality commodities of any EU member, as borne out by many statistics, then many farmers would not now be farming and the UK taxpayer would have to fund a much higher food import deficit than £6 billion a year.

It is also interesting to note that statistics record the UK, on the whole, as having the largest holdings and herd sizes coupled with the lowest use of labour. Because of our scale of farming the UK is more productive and better able to compete with the rest of the world. UK farmers tend to have the ability to withstand higher overheads and they are therefore able to enjoy better production equipment, and thus, on the whole, to produce better quality end products.

Will the Minister encourage and help this industry to comply with Article 39 of the Treaty of Rome,

    "to increase agricultural productivity by promoting technical progress and by ensuring the rational development of agricultural production and the optimum utilisation of the factors of production, in particular labour".

This makes it clear that it is by structural development that the agricultural community is to achieve a fair standard of living and that social policy should not be funded by the CAP, for example by subsidising the growing of the low quality, non-saleable tobacco crops that are grown in some member states or, more importantly, redirecting agricultural funding towards the environment and conservation. For, if our farmers, large and small, are profitable, they are always going to be able to look after the environment and the countryside.

On the subject of the CAP, can the Minister also tell us who will be responsible for agricultural matters devolving to Scotland and Wales and to what extent they will affect the CAP as it applies to Scotland and Wales?

The United Kingdom's farmers are so often seen in a bad light, so perhaps I may take this opportunity to speak up for the farmers of this country. As we have heard, they caretake nearly three-quarters of the UK's landmass. The countryside which we enjoy today and which is admired by the world was created by our farmers and landowners who, having profitable farming

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businesses, were able to enhance the environment that they were born in, lived in and worked in. Like the majority of farmers, I care greatly for the environment and the rural life that surrounds us. We spend an abnormal amount of time, effort and finance to continue to enhance and renovate our living countryside, usually consulting and having to gain consent from many public bodies to carry out those works. We do this mainly at our expense, but also with public subsidies and grants; but those grants and subsidies are unlikely ever to approach the amount we pay in tax each year.

6.10 p.m.

Lord Middleton: My Lords, it is with a degree of nostalgia that after nearly 20 years I find myself on this side of the House again and debating agriculture in support of my noble friend Lord Ferrers. If there has been a common theme in this debate, it is that farmers are hard-pressed financially and depressed by the present gap that they perceive in understanding between themselves and the urban public. They have waited with some considerable interest and anxiety for a line on the present Government's agricultural policy, and they have now had it in the form of the speech given by the Minister of Agriculture, Fisheries and Food earlier this month at the Oxford Farming Conference. I am surprised that that has not yet been mentioned, and I should now like to concentrate on that statement. However, it cannot be read in isolation from the Government's statement on foreign policy, for reasons that I shall explain.

During the 4th December debate in this House on the enlargement of the European Community, the Government confirmed that enlargement was at the top of their foreign policy agenda, as had been the case under the previous government. The noble Lord, Lord Whitty, also said that the Government were "absolutely committed" to "radical reform" of the CAP. Of course, one cannot be done without the other. The enlargement pressures on the CAP, together with the pressure that will come from a renewed round of WTO talks in two years' time, were highlighted in the Minister's speech at Oxford. There are a great many other good reasons for radical reform of the CAP. I am wholly in agreement with everything that the Minister said on the need for action in this area.

Sub-Committee D, during the 12 years that I served on it, concentrated on the subject. In our 1991 report, entitled Development and Future of the CAP, we criticised the MacSharry reforms and said how such reforms should be carried out. Our recommendations have, over time, become accepted by our farming organisations. They were put up as a reform option by Dr. Fischler in his 1995 Commission strategy document, but rejected by him as too radical. So, it is gratifying to see them again appear as the basis for reform in Dr. Cunningham's speech. In his statement, he referred to the European Council launch, under the UK presidency, of Agenda 2000. It will be hard enough to find agreement on the current recommendations in the Commission's document, but harder still to get agreement to the fact that they do not go nearly far

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enough. Therefore, it is fortunate that the Agenda 2000 negotiations are to start this year in the Agriculture Council with a UK Minister in the chair.

Again referring to the Oxford statement, it is clear that the Minister knows that fiddling about with milk quotas is useless when we should begin to phase them out altogether, alongside the subsidies on wine and olive oil. I note that the Minister also took a robust line against modulation in the context of farm support, pointing out that differential support for small units is economically unsound and, if adopted, would be greatly to the disadvantage of the UK. There are other ways of looking after social problems in rural areas in the at present rather vague proposals in Agenda 2000 for developing what is called an "agricultural environmental policy" and a "rural development policy".

I turn now to the beef regime. For those who farm mostly in the uplands and on marginal land in the lowlands and who produce high quality calves from beef-bred cattle, the one bright spot has been the suckler cow subsidy and the premium payments, especially the former. But it would be illogical to call for such support as may be available to be decoupled from production and at the same time to ask for the continuation of the beef, cow and sheep subsidies in their present form. However, we must continue to help our less favoured areas. The Agenda 2000 environmental and rural development proposals will need to be worked out and adapted to provide that support.

I have not had the time to refer to those parts of the Minister's speech which described the measures needed to foster "environmentally friendly" and "consumer friendly" farm practices. As I said earlier, there are huge misconceptions about farming. Nevertheless, if the urban public are to be happy about CAP production payments being diverted for the benefit of the rural economy, it is important that measures are put in hand which make sense economically and which are based on sound science, not prejudice. We need measures which will strengthen the standing of the industry in the eyes of the public.

I thank my noble friend Lord Ferrers for initiating this useful debate, which will no doubt provide an opportunity for the noble Lord, Lord Donoghue, to confirm (and perhaps to amplify) the message that came from Oxford. The message that I got from Oxford was that in the next six months the process of CAP reform under the UK presidency is more likely to advance in the right direction than would otherwise be the case.

6.17 p.m.

Lord Rathcavan: My Lords, I declare an interest, and a small involvement, in a farm producing beef and lamb. I am also a member of your Lordships' Sub-Committee D of the Select Committee on the European Communities, which is currently preparing a report on the implications for the rural economy of the European Commission's Agenda 2000 and its proposals for the further reform of the CAP.

I should like to add my voice to the many already raised in this debate, including that of the noble Lord, Lord Middleton, about the plight of the smaller, often

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family, farmers who rely on beef cattle and sheep for their livelihoods. For years they have been the poor cousins of the dairy and cereal men. They do not have many, if any, options to switch production into other crops or products. In my own region of Northern Ireland, which has a proud and innovative history in agriculture, as the noble Lord, Lord Alderdice, indicated, that important group of beef and lamb farmers--many, but not all, of whom are hill farmers--accounts for two-thirds of our farms in Northern Ireland; that is, 21,000 farms and over half (35,000) of the jobs in the agricultural sector. That group of farmers is undoubtedly bewildered at the moment, if not in despair. I shall briefly explain why.

I hope that the Minister will reflect on the circumstances with which those farmers have had to contend during the past 20 years--a relatively short period in the life of a family farm. They have had to contend particularly with the swings in policy direction from Brussels and with the CAP. In the late 1970s and early 1980s, the Farm and Horticultural Development Scheme encouraged them (with enormous financial support) to reclaim and to put into production marginal land; to bury walls and hedges; to build new roads into the hills--they have now become scars on the landscape; to demolish old buildings and construct new and often ugly ones, unsympathetic to the environment; and to create new pastures at higher altitudes for increased production which subsequently could not be absorbed and ended up in cold storage. This grandiose European scheme for greater production of sheepmeat and beef was followed by the about-turn of quotas for suckler cows and ewes and incentives to set aside land and remove it from production.

Now many farmers can benefit from handsome incentives to rebuild the walls and replant the hedges that they buried and repair the old building that they have neglected. No wonder these farmers are confused and bewildered. Some have to rely on 50 per cent. of their income coming from various government and European sources. There are ominous threats to that support. Even with cheap family labour, if they break even it is a good year. So much for the minimum wage in the family farm community. They ask where the CAP will go next.

There are some indications in Agenda 2000, produced by Franz Fischler, European Commissioner for Agriculture, that he will look sympathetically at the plight of the rural economy. There are few if any details of what measures are proposed. We await further proposals in March. I hope that they will at least continue and expand the ESA and similar schemes which have done so much to encourage farmers in marginal areas.

The Secretary of State for Agriculture in another place has a constituency with many hill farmers who are sheep and cattle producers. I hope that he is listening carefully to his constituents. I also hope that the noble Lord, Lord Donoghue, who has grasped the detail of his new portfolio with skill, will fight the corner of the marginal and hill farmer in Brussels and fight for the survival of the rural economy. I hope that he is aware

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of the turbulent background to the life of these less favoured farmers and will strive to create conditions in which they can at least plan for, rather than fear, the future.

6.22 p.m.

Lord Milverton: My Lords, it gives me great pleasure to join in this debate initiated by my noble friend Lord Ferrers with his usual fascinating and wonderful humour based on great depth of thought. All are agreed on the importance of agriculture to the United Kingdom. That is obvious but may have been taken for granted by many, although not by farmers or those who live in the countryside. Perhaps that is why the subject is before us now in such a strong way. The efficiency of our agriculture, which no one questions, may in part be the reason for the general concern about future policy. Apart from the involvement of Brussels and the much needed reform of the CAP, there is a need to generate greater understanding and appreciation of care for the land and what is involved in the production of food from it. The same applies to the breeding of animals for various purposes.

My interest in agriculture stems from my study of it in Kenya and my experience as a curate, all of it spent in country areas. I dare to make some suggestions with regard to agriculture in its widest sense. First, can a way be found for the guidelines on this subject to be better worked out to halt the decline in the number of agricultural workers? Arts and crafts related to agriculture in its fullest sense and also the commercial aspects can be established in rural areas of the country rather than in built up areas or in only a few centres. Do all farms have to be huge, pushing out smaller ones? If I remember rightly, one or two speakers doubted the importance of small farms, but most have upheld them. When they are pushed out there are fewer places for those who wish to farm. Many wish not just to work on farms but to have their own farms. We know that there are not sufficient places for them at present. Surely, there must be room for both large and small farms in England, Scotland, Wales and Northern Ireland.

With regard to personnel, my noble friend Lord Radnor, referred to hedges. Before machinery came along to cut hedges the task was performed by people, and we know that it was done with great art and craftsmanship. Surely, that can happen again. Hedges cut by machines do not look attractive. I cannot help but feel that it will kill hedges.

The building of stone walls is a craft. I remember having a conversation with an undertaker on the way to a funeral in Wiltshire. Many stone walls were disintegrating. He explained to me that the stones had been placed incorrectly. That is an art and craft. Let us have more of this rather than machines--or else just fences but no stone walls or hedges. Hedges are important for habitats.

I mentioned set aside in the debate on the countryside a short time ago. Surely, greater use can be made of set aside land rather than letting it go to nothing; it should be controlled and managed as wild meadows, especially woodlands. All of these matters can attract people to the

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countryside and retain those who like to work on the land. Equipment may be necessary, but it is sad to see the decrease in work on the land. I saw that in one of my parishes in the country. Years ago it had its own vicar and quite a reasonable population. As agriculture became more mechanised so the population decreased. That is why I believe that arts and crafts in the countryside will work. Forestry may bring vitality back to the countryside and the "community" aspect that it once had.

I hope that Her Majesty's Government will take note of what has been said to enable greater use to be made of the land in its fullest sense and the wonderful people who work the land and farm it, so that urban people realise that they must cherish and take care of the land. That is why we need to be careful about roaming rights.

6.30 p.m.

The Earl of Courtown: My Lords, first, I thank my noble friend for giving the House the opportunity to debate this important subject. I should perhaps declare an interest, unfortunately not as a farmer but as a chartered surveyor qualified in the rural practice division of the institution. As many other noble Lords have said, there is a great feeling of uncertainty in the industry. We have only to see the events at Holyhead and Fishguard to realise that the farming industry is taking steps that just a short time ago we saw only on the other side of the Channel.

My noble friends Lord Peel and Lord Clifford of Chudleigh said that farmers and landowners, many of whom take a responsible view of public access, now fear that a general right to roam will be forced upon them. It was interesting to note in a review of the Royal Institute of Chartered Surveyors, published 18 months ago, that, after canvassing 60 interested organisations on whether they had a written policy statement, it was found that only 36 had. When the Labour Party was asked whether it had such a policy on this important matter, it answered in the affirmative, but was unsure as to whether it had carried out any research before adopting that policy. I should be grateful if the Minister would tell the House when the consultation paper on access to the countryside, promised for July of last year, will be forthcoming.

The agricultural property market bears further examination. There is a view, with which I agree, that in general farm values will fall. The simplistic view is that that will enable more entrants to get their foot on the ladder, but we all know how difficult that is in practice. I believe that we shall have a tiered market. It will still be a buoyant market for first class commercial units, farms with a high residential value, and those areas which come on the market adjacent to other farmers keen to expand. The rest will be marginal, in all senses of the word.

The future, as the right reverend Prelate said, is far from bright for many large and small farms, with falling incomes and high servicing costs to cover. I understand that the banks and landlords are being most understanding, but, if interest rates continue to rise, the former may change their views and the latter will probably suffer the same problems as their tenants.

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The Family Farms Association, of which I was delighted to be asked to become a vice president, with the noble Lord, Lord Beaumont of Whitley, has pointed out to me a number of areas where the small farmer is being hit hardest. Many in that sector of the industry cannot justify the use of computers, and cannot afford a farm secretary. They feel that they are being swamped by a plethora of regulations and paperwork which many do not understand, and cannot comply with.

The welfare of farm animals is of course of prime importance. It would be false economy not to look after one's stock professionally, but welfare does not come cheap. Another agricultural institution under threat is the livestock auction market. In 1981, there were 312 in England and Wales; by 1992, the figure had reduced to 246. Markets are still closing. Sturminster Newton, which was one of the biggest in the calf trade, is now closed. Kidderminster market is either closed or will be closing shortly.

The BSE crisis has caused, directly and indirectly, income losses to those businesses. With the change of agricultural policy towards quotas rather than subsidies, the value of trade, upon which the auctioneers base their commission income, has remained flat for some time. Market margins remain tight, with labour costs amounting to almost 50 per cent. of total cost, excluding a rental figure. BSE has required further handling and checking of the stock, which the operators have had to accept at a time when their income is dropping.

Further pressure on markets is increased by redevelopment of the sites. Many are situated close to town centres and so have a high value. Local authorities, which own many sites, are under pressure to increase rents, although I was encouraged to hear of an authority in the north which is charging a peppercorn rent because it does not want to have a market town without a market. Once again, it is the small farmer who is most reliant upon the market. It must not be forgotten also that for many rural communities that meeting place, where allied agricultural industries do business, fulfils an important social role.

The noble Lord, Lord Geraint, blamed Conservative handling of the BSE crisis for the dire straits in which agriculture now finds itself. I cannot agree with him. More emphasis should be placed on the strong green pound.

Many noble Lords mentioned the forestry industry. I wanted to ask a question at Question Time today, but I was unable to do so. I hope that the Minister can help me. His noble friend Lord Sewel referred to there being 8 per cent. of new plantings this year. Is he referring to new plantings on Forestry Commission land or private land? I shall be interested to hear the proportions.

It is vital that government support should take into account the impact of the BSE crisis on the rural economy as a whole and not solely on beef farmers. Exceptional circumstances now face the agricultural industry. The Government must take exceptional action.

6.35 p.m.

Baroness Trumpington: My Lords, I asked particularly to speak late in this important debate--I did

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not imagine that I was going to be the 30th speaker--because I reckoned that the subject of horticulture would not figure large in your Lordships' remarks. Apart from my noble friend Lord De Ramsey's welcome mention of onions, no one whom I have heard has mentioned fruit and vegetables. To coin a phrase, I feel that that subject deserves a bite of the cherry.

It seems to me that the word "agriculture" these days is a bad word, whereas the word "environment" is all that is good. But one cannot have one without the other. If people want the landscape of beautiful Cumbria to remain beautiful, it follows that hill farmers must receive financial help in order to provide lawnmowers, in the shape of uneconomical breeds of sheep, to keep the hills manicured. Without those sheep, the hills would rapidly develop the shaggy look of being covered with scrub--not something which is considered environmentally friendly these days.

Exactly the same principle applies to horticulture. One has only to look at set-aside to see what I mean. I suggest that noble Lords take the Eurotrain from France. By the time you emerge from the tunnel on the English side, you will be travelling sufficiently slowly to be able to admire Kent--the garden of England, so-called--but for how much longer?

Let me first examine the plight of the fruit grower; 1997 was a year of real disaster for them, owing to the late spring frosts. An estimated 43 million-pound crop was lost. Not only were apple and pear crops affected, but a further estimated £6 million of cherries and plums must be added to that amount. That act of God came at a time when growers were building a significant market share, working with their customers--in other words, the retailers--to replace imports with high quality home grown fruit.

The damaged crop and strong pound have sucked in more imports than usual this year and kept prices low. I am told that the NFU is monitoring aid packages in other member states. I understand that it is likely that France, Italy, Greece and Belgium will compensate growers for their losses. In the Trento region of Italy, £14.7 million has been made available to pay to fruit co-operatives struck by frost damage. In France, low interest loan schemes are available to growers and new entrants, thus ensuring an industry for the future. But what of the UK?

The UK fruit industry will be eroded as businesses fold due to loss of crops. The Government rejected an NFU call for a loan scheme in September. As European growers are supported, in contrast to the UK, and the whole industry faces steadily growing competition, growers will be looking for sheer survival in the next year--unable to reinvest for the future growth of the industry.

I fear that that is not the end of my tale of woe. Do your Lordships realise that a cabbage grower has received the same price for his crop from 1987 to the present day; that is, £2.50 for 12 cabbages? One grower in Kent has an annual turnover of £250,000, but he himself is on income support.

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Growers of tastier tomatoes, like their fruit brethren, suffer from the high cost of sterling. Thus tomatoes are being imported at prices 30 per cent. lower than their English equivalent.

Let me remind your Lordships that horticulture is a big employer, and, apart from regular employment, it is very important that work being undertaken now on the social security review includes the issue of seasonal work. Ten thousand eastern Europeans come to this country every year in order to gather the fruit and vegetable crops. Yet those 10,000 are a mere drop in the ocean compared with the numbers needed to do the job. It is not much good having fruit on your trees and bushes and having no one to pick it.

The horticultural growers are a hardy lot despite their misfortunes and they have welcomed Commission Regulation 2200/96, the new fruit and vegetable regime, which has brought support for the development of UK horticulture. Equally, I should be wrong if I did not congratulate MAFF on the work it has done to make funds available to UK producer organisations. It is to be hoped that MAFF will continue to help the development of the industry.

I started these remarks by mentioning the Garden of England and my hope for its flourishing future. The year 2000 will see many more visitors to these shores. It has been suggested to me by those in the fruit business that an instant and beautiful orchard could be planted in the Dome at Greenwich. Now there's an idea for one item, to show what we can do in this country. It would be something that illustrates our power to produce the best. All our horticulture growers ask for is--the awful expression--a level playing field which is applied equally to them as to those on the other side of the Channel Tunnel.

6.41 p.m.

Lord Cromwell: My Lords, I must immediately declare an interest. I am one of the shrinking band of men and women in this country who try to produce beef. I shall be brief, but I feel that while I share many of the concerns expressed here today I should say a word on behalf of the consumers.

It is all very well for us who at present live and work in the countryside to resent the urban population or to sneer at their ignorance of rural matters. They are, however, our customers. If the food standards agency can positively forge this long-overdue link between the producer and the consumer, so much the better.

I am particularly concerned because in the beef industry, as in a number of other sectors, there is a burgeoning of assurance groups of various types. They are a good idea but there is a danger that they will be seen as groups, created by, speaking for, and belonging to the producers. What value will their endorsement of insurance have to the consumer? I must appeal to them to promote their consumer credentials, if they have any, and in any event to recognise that unless they forge public alliances with, incorporate, or obtain public endorsement of consumer organisations, they will not convince or carry the public.

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Calls to support UK agriculture in general are all very well but they must be based on consumer support and consumer involvement. The CAP has separated many farmers from consumers and if the FSA can put us back together again, so much the better.

6.44 p.m.

Lord Mackie of Benshie: My Lords, I rise to speak with trepidation after 31 speeches. I had looked forward to this debate with a good deal of anxiety as I knew that the noble Earl, Lord Ferrers, who has been thanked often enough, would make an excellent speech. I knew that I would be jealous of what he said and would wish that I could have expressed myself in the same way. I must congratulate him on his marvellous attack on the previous government for their handling of BSE without once mentioning that he was doing so. That is skill of a high order.

The rest of the speeches have been on the whole extremely good, much better than I thought would be the case. I expected that we would all repeat ourselves. I was delighted with the speeches of colleagues on my own Benches, but I was not so pleased with their use of the term "the noble Minister". As everyone knows, a Lord is "noble" automatically, but the nobility of a Minister is a matter of opinion. So I hope that they will call him "the noble Lord the Minister" in future.

The serious side of the present crisis--and it is a crisis--has been brought out by many speakers. We all have personal experience. I have now retired from farming but I have many friends who are active in it. One of them, a smallish farmer, told me the other day that he had bought 500 lambs for fattening in the back end of the year. He paid over £30 per head for them; today, without his costs, they are worth about £26. That kind of thing is repeated throughout farming.

Mr. McLean, the agricultural spokesman in the Royal Bank of Scotland, said at the end of the year that in Scotland--and this applies over the country--farmers' overdrafts had increased by 10 per cent. That is 10 per cent. at the turn of the year but before the main bulk of income comes in there are another eight or nine months to go. So a great many people will be in serious trouble.

There is no shadow of doubt that we are in an entirely different position from the time in the past when farmers have been a little bothered and said so. I listened to the noble Baroness, Lady Young of Old Scone, with interest, but not with approval. She said that farmers had made far too much money, but I thought that she might be a little wrong. Perhaps I may produce figures from my native country, Scotland. The fall in income is quite straightforward: malting barley is down 25 per cent.; pig meat, 25 per cent.; milk, 20 per cent.; lamb, 30 per cent.; beef, nearly 30 per cent. That is quite a lot of money.

In those glorious years when farmers were wallowing in it and people were making silly jokes about farmers having to sell their second Bentley, we find that 1995-96 was one of the best years. I have the average income figures produced by the Department of Agriculture in Scotland. For small farmers, the net farm income was £1,400; for medium sized farmers, it was £22,000--

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riches indeed. For big farmers--farmers with over 1,000 acres--it was £54,000. The average income for the year was £18,800. That is not rolling in it. The average wage in industry for a manual worker is £314 a week, £15,000 a year. The income stated in the document does not contain anything for the farmer's own labour nor that of his wife. So it cannot be said that in this wonderful year farming was the kind of paradox which the noble Baroness seemed to indicate.

Farming faces a real and genuine crisis and we must do something about it. The Government are at fault, as were the last government, for not taking up the European offer which would give an income to assist farming of nearly £1 million over three years. I do not know why the Government are not taking it up. I suspect it is because the Tory government made a bargain at Fontainebleau which meant that instead of getting half from the European Community they would have to pay 30 per cent. of the cost. But other countries have it. Figures have already been given and it is useful to repeat them. Incomes rose in Germany, Belgium, and France. There was a 1 per cent. loss in Denmark, 1.3 per cent. in Luxembourg, 2.6 per cent. in Greece and so on, to 13.7 per cent. in Portugal and 23.1 per cent. in Great Britain. There is something unfair in those figures. The handling of the BSE crisis played a part in that, and this Government and the previous government are to blame.

However, we are now looking at reform of the CAP. Every political party, including ours, says that it wants to see a competitive agriculture, but I do not believe that we can see that in Europe without some organisation. During the 1930s free trade caused misery in the United States--for example, The Grapes of Wrath--and we saw the dereliction and poverty which struck the people of this country. I do not believe that unrestricted global competition is right and proper for the primary producer. One must take into account the market, but one must try to organise it otherwise we shall have the situation which existed in the 1930s.

The Government are facing other problems; the greatest is the enlargement. I was a member of the agriculture committee of the Council of Europe which undertook a good deal of work in Poland and Hungary. They do not have to be prepared to meet our competition in Europe, but we must be prepared to meet their competition. In those countries, the standard of life is such that one tonne of barley at a poor price will pay a man for nearly five weeks. In this country, it takes at least three tonnes of barley at the present price to pay a man for one week. That is the kind of situation we must resolve, but it is not easy.

Many comments have been made about the attitude of the urban population in this country. It is exemplified by what economists call the great globalisation. People in Germany and France are closer to their roots in agriculture, but we in this country have been urbanised and industrialised for longer than those in any other country. As a result, the old free trade example of cheap food has permeated the urban population with the result that they do not take farming seriously or appreciate how much it does for this country in all kinds of ways.

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Any CAP reform must take those factors into account. We must have imaginative policy; for instance, the production of a retirement bond which lasts for 10 years and which the farmer can cash. He is then given time to adjust to competition from the larger farms. It gives time for farmers who have perhaps a 200 acre farm, which used to be large enough to provide a good living, to organise staying in the farm while contractors do the work. He might have a specialist niche activity which might not pay. He may grow onions in a competition--

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