Previous Section Back to Table of Contents Lords Hansard Home Page

16 Jun 2003 : Column GC179

Official Report of the Grand Committee on the

Local Government Bill

(Fifth Day) Monday, 16th June 2003.

The Committee met at ten minutes before five of the clock.

[The Deputy Chairman of Committees (Lord Haskel) in the Chair.]

The Deputy Chairman of Committees (Lord Haskel): Perhaps I should explain to the Committee that there is no need to touch the microphones. The engineer will do all of that. As we are not expecting any votes in the main Chamber, we will not need to know the regulations regarding that.

Clause 68 [Exemptions for agricultural buildings]:

Baroness Hanham moved Amendment No. 141:

    Page 33, line 39, at end insert—

"For paragraph 2(1)(a) (which defines agricultural land) there is substituted—"(a) land used only or mainly as arable, meadow or pasture ground,"."

In moving Amendment No. 141, I shall speak briefly to Amendments Nos. 142 and 143.

I start with Amendment No. 141. At present, land used exclusively for agriculture is exempt from non-domestic rates. Agricultural land is defined as land used only as arable, meadow or pasture ground. There is a de minimis exemption permitting land to be used to a limited extent for other purposes and still to qualify for the exemption. The valuation officer takes that as being activities that do not last for more than one day at a time, without an intervening period of agricultural use. For example, one day's point-to-point with horses will not prevent the exemption from applying, although three days might.

That may have been satisfactory when a farmer was only a farmer and did not need to use his land for anything else. However, it does not reflect present realities. Few farmers can expect to make a living purely from the land. As the Government have recognised, farmers must diversify into other activities, if they are to survive. That was in the rural White Paper of 2002. It is unfortunate that many farmers are inhibited from diversifying by the rating system. At present, if a farmer chooses to do something on his land even occasionally with a view to raising extra income, he runs the risk that, by doing so, he will lose his exemption from rating and, so, the incentive to diversify.

We are not asking for farmers to be permitted to do anything and still qualify. The requirement will still be that land is used "only or mainly" for agriculture. We

16 Jun 2003 : Column GC180

are asking that they might be allowed to do slightly more than the one day—at times—diversification, as at present.

Amendment No. 142 brings us to the matter of other common agricultural uses, including poultry farming, which are included in the definition of agriculture for the purposes of the exemption from non-domestic rating. Amendment No. 142 would, in the interests of consistency, bring game farming within the exemption. In accordance with the Government's insistence that farmers and landowners diversify from their traditional methods of earning money, it is increasingly common for them to move into game farming. However, game farming does not come within the definition of agriculture. There is no obvious reason for that: we assume that it is just a reflection of common agricultural practices, when the General Rate Act was introduced in 1967. If so, it is out of date.

Moreover, the Government increasingly treat game farming as if it were akin to conventional poultry farming. For example, the recent Diseases of Poultry (England) Order 2003 extended the definition of poultry in the Animal Health Act 1981 to most species of game bird. It is appropriate that both activities be treated the same for rating purposes.

The final amendment is Amendment No. 143. In addition to the exemption for agricultural land, there is an exemption for agricultural buildings used with that land. The amendment would apply the principle relating to agricultural land, as expressed in the first amendment, to agricultural buildings. Again, there is an exemption that permits a level of non-agricultural use, but that is not entirely satisfactory.

Paragraph 8(3) of Schedule 5 states that, when deciding whether a building is used "solely",

    "no account is taken of any time during which it is used in another way, if that time does not amount to a substantial part of the time".

That applies only to time; it does not apply to extent. For example, exemption would apply if a barn were occasionally given over entirely to use as a shop. It would not apply if a small area of that farm were used permanently as a shop. It is hard to see the justification for the distinction. I beg to move.

Earl Peel: I apologise for intervening at such a late stage in Committee, but, as somebody with rural interests, I thought that it might be appropriate for me to say a few words in support of my noble friend's amendments.

As my noble friend said, in general terms it is clear that the traditional role of the farmer is changing rapidly. All the encouragement from government and from the various agencies is designed to help farmers to diversify as much as possible to overcome the great difficulties that they face if they are engaged in traditional agricultural systems. Any help that we can give to farmers in that direction will, I am sure, be supported by the Minister. Amendments Nos. 141 and 143 would deal specifically with those points.

16 Jun 2003 : Column GC181

My noble friend raised another point—the other side of the argument, which is equally important. If a farmer chooses to do something on his land—or, presumably, in his buildings, which are de-rated—even occasionally, he runs the risk of jeopardising the de-rating concessions that he has. We must consider both issues carefully, and I support the principle behind the amendments.

I shall deal more specifically with Amendment No. 142, which is concerned with what I regard as the anomaly that game farmers are subjected to rates when those producing poultry are not. Most observers generally believe that, when the Local Government Act was passed in 1986, there was no intention to discriminate against game farmers. Poultry farming was included in the definition of agriculture, but game farming was not specifically excluded. It was a genuine mistake. The game farmers are losing out simply by default, rather than by any prescribed or determined intention of the government of the time.

The two activities are broadly comparable. There are those who produce game in the spring and summer, and poultry—turkeys, for example—for the winter. They pay rates on one activity but not on the other. That is something of an anomaly. Interestingly enough, fish farmers are exempt. I am sure that the Minister will be aware of that. That is another example showing why game farmers have been treated unfairly.

There is another point that, as, I am sure, the Committee will appreciate, creates a great deal of ill-feeling. French game farmers are exempt. They export a lot of game to this country, and our game farmers reckon that they are being badly treated on that front, as the Minister will, no doubt, appreciate. That situation seriously disadvantages our game farmers, when the Government are striving wholeheartedly to get an even playing field in trade with European countries.

My noble friend mentioned another important point. Game farmers, as well as poultry farmers, are subjected to all the new regulations on nitrate vulnerable zones, control of diseases, feedstuffs and animal by-products and waste. Game farmers are now covered by all the directives in the same way as poultry farmers. Some equality is required in the rating system.

I hope that the Minister can accept that the arguments for not providing rate relief for game farmers are spurious. If justice is to be upheld, the Minister will accept my noble friend's amendments.

5 p.m.

Baroness Maddock: I support the sentiments behind the amendments and concur with much of what was said in support of them. I am a member of Sub-Committee D of the Select Committee on the European Union, which deals with agriculture. In recent months, I have become well acquainted with many of the issues facing farmers, particularly the way in which they are regulated. In trying to deal, in

16 Jun 2003 : Column GC182

particular, with environmental legislation, we are considering the whole-farm approach. The amendments tackle part of that issue.

Flexibility is important for its own sake. If we are too rigid in saying what can be agricultural land and what cannot for the purposes of the Bill, that would not be helpful to developments in agriculture, particularly sustainability and reform of the common agricultural policy.

If the farm shop were only part of something, I would have a certain sympathy with Amendment No. 143. However, I have one question. Many butcher's shops and greengrocer's shops have disappeared from our town centres. I can see people asking, "Why is that farmer getting rate relief on his shop, when I am finding it so difficult to keep going in the town centre?". In my town, one of the local farmers has taken over the butcher's shop on one street. Perhaps that is the answer. I do not know whether the Government have considered that issue or whether those who tabled the amendment have any views on it. We hear about ordinary shopkeepers worrying about charities getting relief on rates, and I can see that there could be a little conflict there. Otherwise, I support the sentiments behind the amendments.

Lord Monro of Langholm: I also support the amendments. Noble Lords who attended the debate last Wednesday on the countryside will have realised how concerned Members were to encourage the rural economy and keep employment in the countryside. Bearing in mind the huge overall outlay of rateable values, this is a tiny aspect that could be very valuable to a few people dotted about the countryside who wish to rear game.

There are many jargon words in agriculture, and a lot of them were floating about last Wednesday. "Diversification" has been a common one for years, and everyone is trying to think up ways of using agricultural land and buildings to provide income and keep employment in the countryside. Sometimes, it does not work. My neighbour started making goat's milk cheese, but, as soon as he put in a little plant, it immediately became industrially rated. That seemed a bit harsh. It ended a good scheme before it really got started.

We have an opportunity to help people start rearing game birds in small units throughout the countryside and to help those that are already in being—they are very important—by giving them a concession on rates. After all, we accept set-aside—using fields for no purpose—which seems like a strange thing to a farmer. The departments of agriculture in England, Scotland and, I am sure, Wales are happy to leave fairly large strips of land on either side of hedges to give birds a chance to nest naturally. Here, we have an opportunity to put a small part of the average farm or estate to good use in rearing birds for country sports.

The noble Baroness, Lady Maddock, rightly used the word "flexible". I hope that we will be prepared to be flexible and give some people a little hope of a substantial return without any great loss of rates to the

16 Jun 2003 : Column GC183

local authority. Given the Minister's conciliatory attitude at the end of the previous sitting, I am sure that he will continue the good work.

Next Section Back to Table of Contents Lords Hansard Home Page