Examination of witnesses (Questions 160-179)
WEDNESDAY 28 MARCH 2001
MEACHER, MP, AND
LAMBERT Mr Mitchell
160. In respect of what "businesses"
mean in part B of your terms of reference where you were asked
to draw up specific guidance for public and businesses in accordance
with veterinary advice.
(Mr Meacher) I am slightly puzzled by that question.
The two main objectives of the Rural Task Force are, firstly,
to set down the basis on which people can make a visit into the
countryside, which we have been discussing at some length just
nowand that applies, I suppose, to members of businesses
as it does to members of the publicand secondly, about
how to ensure the survival and regeneration of small or indeed
other businesses who may be affected by foot and mouth. Those
two are different questions. I am reminded that I think you are
probably referring to tourism guidance which has been given by
DCMS to owners of attractions.
161. Right. So it has come out separately to
(Mr Meacher) Yes, separately.
162. The final related question, or to do with
access, is that there have been some reports that farmers have
wanted roads closed or limited access. It has been said that in
some cases it is found that there are not sufficient powers in
the hands of the local authorities actually to close the roads
down. Is that true, or do the powers exist?
(Mr Meacher) The highways authorities only have power
to close roads for traffic reasons. However, I understand that
MAFF legislation does allow them to make an orderI think
it is under the Foot and Mouth Order 1983with powers for
MAFF to close roads where it is necessary for disease control.
So it is possible to do this. I am aware of concerns about these.
When I went down to Devon someone strongly bent my ear about the
need to close roads leading into Exmoor, and I am aware that police
have informally stopped access to some roads. I would repeat,
though, that MAFF veterinary advice continues to be that the closing
of roadsthe closing of tarmac roadsis not necessary,
but the powers are there to do it, if the highways authority cares
to apply to MAFF for the use of those powers.
163. You are not saying that you want to encourage
people from Cumbria who want to go for holidays in Norfolk, are
you? What do you think the feelings of a boarding-house keeper
in your constituency would be if they got a booking for two nights
from somebody in Longtown?
(Mr Meacher) I was asked a question as to what if
someone came from the most affected areas to a totally uninfected
area. I do understand the force of the question, and I suppose
that it is possible. I think it is unlikely. Again, they would
be expected, wherever they come from, to obey the same rules which
are based on safety first. We must obey safety-first rules. We
must do nothing in terms of access to the countryside which in
any way endangers the spread of this disease, but I think that
can be reconciled, I repeat, with not total close-down, and we
have to find that reconciliation, but one which protects the farmers
and their interests. That is the prime concern.
Mr Mitchell: Now one perhaps cynical question.
I was somewhat upset, during the miners' strike in the 1980s,
at the lack of support for businesses in the mining areas which
were hit by a year-long strike, who got nothing. Looking at it
cynically, rural businesses, particularly tourism, are hardly
going to make money anyway, because who in their right mind is
going to go into the countryside in this weather anyway? They
are going to be either conning you for money they would not have
got because nobody wants to go in this weather, or you are going
to be stuffing money into their mouth to keep them quiet for an
164. He is a member of the Labour Party.
(Mr Meacher) I suspect that many members of HM Treasury
will be arguing along those sorts of lines. We seriously do have
to be careful. This is always a problem in a situation like this
where there will be people who try to get a free ride, who try
to hitch on the bandwagon. Again, we have this very difficult
task of ensuring that the deserving get real help that they need,
whilst preventing people just taking advantage. It is difficult.
165. I will explain the reason why I am asking
quite a lot of questions. It is because, as you know, Powys is
probably second or third affected in the UK, because we are coming
up against all these issues at the moment. One request is that
you keep the Ramblers' Association directly informed, if you are
not doing so already. Christopher Sparrow from the Ramblers' Association
described the extreme willingness of them to keep their membership
close to what needs to be done, but a slight frustration because
they do not feel they are in the loop at the moment for that kind
of guidance. Maybe they are, but that is the point.
(Mr Meacher) I am sure they are in touch with us.
They are not members of the Task Force. I do not think they have
sought to be, and nor do I think that would be appropriate. I
am sure we will be open with them about the situation. I am certainly
not in any way trying to be secretive or conceal the situation
as we see it from their point of view, but I am grateful for the
fact that they well realise the gravity of this and they are behaving
very sensibly, as I would expect.
166. If you did, I am sure Chris Smith would
never forgive you, as he does a lot of walking. On the question
of advice, I am using this for a specific example, but I know
there are a lot of general issues. As you know, there are lots
of festivals on in the countryside, especially in June and August.
We have got something called the Newtown May Festival in Powys.
They are trying to decide whether the guidance is that they should
cancel their event or not. It is on 8 May. The Welsh Assembly
have said it should not go ahead, but it is not taking place on
agricultural land, it is in a town. It sounds like the kind of
event that you have implied should continue, so the request is,
what should they do? Should they go ahead, should they not? They
will respect the guidance, whether you give it now or later. As
I say, I think there are a lot of towns who would be looking for
this kind of answer as a precedent for their own action.
(Mr Meacher) I am sure that is right. Indeed, just
before I came to this Committee I actually had a situation not
dissimilar to that, which has arisen in my constituency, and I
am sure this is generalised right across the country. I think
the answer has to be that we must abide by the guidance. If that
is still not clear enough, then of course the organisers of these
events obviously wish them to go ahead, but they must get clearance
from the local veterinary advice. That must remain the case if
in any doubt. You can certainly consult the local authority, but
the final arbiters in this matter are the local veterinary officers.
167. This is rhetorical. I would like to say
that they currently feel there is a conflict of advice from what
they see on television from Ministers and what they are getting
locally. Maybe the actual step there would be to clarify the lines
of communication so that they get the same message from two different
(Mr Meacher) I understand people feeling that. People
do want a very simple, clear, unequivocal message. Unfortunately,
in the messy world in which we live, which has been greatly complicated
by this outbreak, it is not as simple as that, even though I think
when you come to examining it there is clarity. We want these
events, festivals, sporting events, fairs to go ahead wherever
they can, and that is the pointwherever they safely canbut
the basis of deciding whether they safely can, whether it is national
advice which makes it clear, as I am doing now, or local advice,
is that the ultimate decision must be taken by the veterinary
officers who know the local situation, and because no situation
locally is ever quite the same, they are all different in some
respects, the judgment must be made on the ground by that person
and we must all abide by that.
168. I have a quick technical point, given the
possible announcement that might be made next week. The Rating
(Former Agricultural Premises and Rural Shops) Bill is being brought
forward. Will any other measures under consideration by the Task
Force require legislation?
(Mr Meacher) Not at the moment. The Rating Bill does
bring forward the extension of the mandatory 50 per cent rate
relief for village shops to pubs, petrol filling stations and
foodshops up to a rateable value of £6,000 which we are actually
increasing to £9,000. That does require legislation. We happen
to have a Bill, fortunately, and we are able to apply an order
to bring it forward, to accelerate it. The other proposals are
the use of existing powers; the proposal for rate relief which
we are proposing, which can be up to 100 per cent, paid for by
Government to the extent of 95 per cent, 5 per cent local authority,
available, as you know, up to a £12,000 rateable value ceiling,
which would include 78 per centmore than three-quartersof
the 390,000 businesses in rural local authority areas. What that
means, if a business does get the 100 per cent rate relief, is
that it could be worth £1,290 over a three-month period for
a property at £12,000 rateable value. That is likely to be
in excess of the rate bill. In other words, it is a complete rate
holiday. That, I hope, is going to give very considerable relief.
We estimate that it might be used by up to 50,000 businesses,
but it does not require further legislation, it is an extension
of existing powers.
169. Why do you fix a limit of £12,000
(Mr Meacher) It is an arbitrary figure. Indeed, it
is no secret, of course, that we have been asked to raise it.
I repeat that it does cover more than three-quarters of rural
businesses in the hardest-hit areas. We think that is pretty well
targeted aid. If we were to raise it to £15,000 or £20,000,
it would enormously increase the cost, and it would be much less
well targeted, so we think £12,000 is a reasonable compromise,
but there is nothing expressly about the figure.
170. Was it your decision or was it the Treasury's
(Mr Meacher) It was in discussion between us and the
171. What comes out of this, though, is that
you have shown a very sympathetic attitude in the debate yesterday,
and you have done the same thing today, but what we are not, I
think, seeing is an understanding of the absolutely chronic, immediate,
dramatic crisis. You have talked about business activities going
on under current restrictions, but for some of them that is just
not possible. I have a number of faxes here from businesses involved
in country affairs. There will not be any season in my area for
some activitiessome turnovers are 89 per cent down. Equestrian
businesses are not allowed out on the roads, they cannot go on
them, they cannot go near animals. Their turnover is down 100
per cent. Hotels down 80 per cent. Pubs down 95 per cent. Garden
visitors down 90 per cent. What you offered last week is encouraging
them, and it sounds sympathetic. You considered help, you were
very sympathetic, you were considering, you were going to make
a proposal. However, what people need is not the denial of a negative,
which is a tax, which you have done on rates, what they need is
a positive. What I would like to address to you is the possibility
of immediate fast loans. There has been the suggestion from the
Conservative Party of a £10,000 loan to small rural businesses.
How can that be pushed through the Small Firms Loan Guarantee
Fund? How quickly can you do it? What is lacking is the immediacy.
You are making all the right noises, you are consulting, you are
talking about vast amounts of information, but these people who
are faxing me in my constituencyso far with only two confirmed
cases of foot and mouthare going bust this week.
(Mr Meacher) I understand the urgency with which you
say that, and I wholly support that. I know I have been characterised
as just considering, consulting, bringing up to date.
172. I am quoting from your statement last week.
(Mr Meacher) I actually think that the rate relief
we are bringing forwardthe extending of 50 per cent mandatory
rate relief, and it could be 100 per cent if local authorities
are prepared to grant itand the wider rate relief which
I have just spelt out, is very positive, tangible help. I think
that if banks are prepared to extend lines of credit, that is
real help. If the revenue departments do deliver deferment and
rescheduling of VAT and PAYE, that is real help. I accept absolutely
that over and above that, we should be looking at whether there
should be an extension of the Small Firms Loan Guarantee Fund,
how far that can be extended, whether that is adequate and, if
it is not adequate, what further measures we can bring forward.
I also accept that we should do that urgently, we should be looking
at it this week. I accept that. However, I also do say to you
that you are wrong, in my view, to give the impression that Government
can somehow sustain the thousands, and possibly tens of thousands,
of businesses that have taken one hell of an economic hit. The
only way to protect those businesses is to persuade the public
that they can safely return to the countryside. There is no other
way. If one is simply going to say that Government has got to
do it on its own, and we fail, then I think I plead guilty, because
there is no way we can succeed, any government, in doing that.
We have got to get people to understand that they can safely go
back to the countryside and spend their money, not as a worthy
act of patriotism, but because they enjoy it. I take the point
that my colleague, Mr Mitchell, has been saying, that unfortunately
the weather does not encourage people to go into the countryside,
it actually encourages the foot and mouth virus, it does not encourage
people to go out and enjoy themselves. However, we have got to
do the best we can, and I am determined to get everything opened
up that can be opened up. You have not asked, and therefore I
will not spend time answering, about the National Trust, English
Heritage, British Waterways, Forestry Commission, Historic Houses
Association. It is just as important that we get them to open
up wherever they safely can, because that then sends the message
first of all that there are things that people want to go and
visit and enjoy, and secondly that normality has returned. So
I have been having discussions with them to try to encourage them
to open up more, and this must be the main channel. The alternative
which you have been stressing is secondary, but it is still important
and it is still urgent. Give us a week and you can judge us.
Mr Paterson: I think there is still a lack of
urgency. You have mentioned rates, you have mentioned going to
the banks about loans, you have mentioned VAT. I mentioned all
of those three things in the statement when Chris Smith, the Tourism
Secretary of State, came to the House of Commons two weeks ago,
and I was accused of ranting and being party political. It is
now your government policy, which I am delighted about, but I
do think you are missing the plot that many of these businesses,
even if you reopen the waterways, even if you do get help from
the bank, are simply not going to have a season this year, they
have missed it. There is not going to be a season.
Dr Turner: That is a bit defeatist.
173. I am not being defeatist. I am realistic.
I am reading out faxes from real people whose businesses are down
90 per cent. There will not be a West-Mids Show this year. The
man who supplies shows will not have a market. As that is a result
of the failure of the state, by allowing this disease into the
country, surely it is incumbent on the state to come to the aid
of these people, and again not just by withdrawing a negative
by saying, "We're not going to have a tax", but by offering
a positive which is a loan? That is why I suggested the £10,000
loan from the Small Firms Loan Guarantee Fund, which is a positive
help to these people now.
(Mr Meacher) You are reiterating your case, and I
do not want to spend too much time reiterating my answer. I gave
a very full answer, and that is what I stand on. I do accept that
further aid may be necessary. We are seeing how far the Small
Firms Loan Guarantee Fund can be extended to achieve this purpose.
If not, we will look, and are looking, at further aid, I do assure
you, but I repeat, it is not the case that we write off tourism
or recreation for Easter. There is going to be a big drop compared
to previous years, there is no doubt about that, but we have got
to work overtime to push up what would otherwise be an even lower
total, and I have not given up my view that we can significantly
increase what in the last two weeks may have looked like a complete
wipe-out. I think we can considerably improve on that, and that
is the drive we are now making.
174. When could you have a decision on the loan
(Mr Meacher) I cannot tell you which day. I spend
all my time every day discussing these matters. Clearly, several
different interests have to come to agree on this. I am anxious
to settle this matter, but we are alsoand this goes back
to an earlier questiontrying to collect data about the
state of businesses. You have quoted some in your constituency,
I am sure totally fairly. The problem about anecdotal evidence
is that it is anecdotal evidence, it does need to be quantified.
I have no doubt that it is accurate.
175. Of course it is.
(Mr Meacher) I have no doubt about that. However,
one can quote any number of examples. We do need to have reliable
national data. I do not wish to do a research thesis, I am not
suggesting we have got the time or commitment to do that, but
we have to have the systematic evidence which is going to persuade
other departments that this is justified, and that is what I am
desperately trying to collect at the present time.
176. I think Mr Paterson has shown exactly why
I should have asked the question which I did ask earlier on, about
the need for evidence, because it is quite clear that not all
political parties have a policy fully to compensate every business
for every loss that they absorb that is from the outbreak of foot
and mouth. I want to look specifically at the issue of hardship
rate relief, which is the issue which is under the proposal to
increase it from 75 per cent to 95 per cent funded by central
Government, which I welcome. I recognise that the Government cannot
give a promise to fund that 100 per cent, because it is an open
cheque for every local authority to give 100 per cent rate relief
to every rural business that comes into the category, but what
I would ask you is if the Task Force is considering giving additional
funding to the local authorities that are most severely affected?
Certainly in those areas where we are dealing here with small
shire districts who are having to pick up 5 per cent of the total
rate bill, that in some cases will be quite a significant chunk
of the budget of a small shire district council in a rural area,
and I think we may well find that councils are not able to give
the sort of relief that was intended under this provision, unless
there is some willingness on the part of central Government to
look at additional funding to cover that, albeit that has to be
done on the basis of how severe the problem is in that particular
area. I also think it may be necessary for central Government
to look at giving additional funding to the most severely affected
local authorities because of the additional costs which will fall
to them in actually giving the service and backup that is needed
to businesses and the wider community in these areas. Are those
things being seriously considered now?
(Mr Meacher) Yes, they are. We are certainly trying
to concentrate on the areas of greatest need. That is certainly
the sensible thing to do. The rate relief is concentrated on those
151 rural local authorities who are hardest hit. I accept also
that if one is looking at aid to particular businesses, it is
those which are in the infected areas, those which now are in
designated areas from which the public may be excluded, whose
earnings are therefore falling potentially to zero, who deserve
the most help. We are looking at the best way to do that, whether
it is through the Regional Development Agency, the extension,
as I have indicated, of the Small Firms Loan Guarantee Fund, whether
it is in terms of small business service in-depth consultancy
advice as to how businesses can adapt in very difficult circumstances,
whether it is by accelerating some of the proposals in the Rural
White Paper, particularly in regard to market towns. These are
all options which we are now urgently looking at, but they are
all aimed at what you yourself say should be concentrated support
for the local authorities and businesses most hard hit.
177. Finally, perhaps I can touch on the wider
issue of the promotion of tourism in this same context. Is there
a recognition within the Task Force and Government that the promotion
of tourism itself needs to be targeted, in the sense that there
needs to be a recognition that there will be localities where
the promotion of tourism is unrealistic for several months to
come, because the only reasons tourists would go to those particular
localities are to walk in the open countryside? Certainly promoting
Mosedale, which is a beautiful area, I would say that 90 per cent
of the people who go to Mosedale will go to walk on the Fells
and certainly would not be welcome to go there, whilst there are
other areas where targeted promotion of tourism either by central
Government or local government could have a much more productive
effect in achieving what is achievable in terms of preserving
tourist businesses in rural areas.
(Mr Meacher) Obviously in Cumbria, Powys, South Devon
it is very difficult to achieve tourist development at this time,
although there are parts in those areasfor example, East
Devonwhich are not wholly affected and where there are
still opportunities which I think we should try to develop if
we can. Of course, it is the other parts of the country also.
Norfolk, which is as far away as you can get in many ways from
the sources of infection, has suffered because of the climate
of fear which exists that "Even if we have not got it now,
we may get it tomorrow; it may come in mysterious ways, and we
can't take any risks". It is trying to combat that, which
is basically unscientific and where the risks are so low as to
be negligible, but where the damage is huge and manifest, that
we must concentrate our efforts, and that is what we are trying
to do. If we can get tourism back into the 50 or 70 per cent of
the country where there is absolutely no reason why it should
not develop perfectly normally at this present time, I think we
get the critical mass which we can develop into the more difficult
areas, although being extremely careful. However, I do not think
we can start in this area, it is the rest of the country which
obviously has the best opportunities.
178. In your guidance to local authorities on
rate relief did I understand you correctly that the rates holiday
that you have granted so faror should I say "rates
relief"only lasts for three months?
(Mr Meacher) It lasts for three months in the first
179. At what point would you take a view as
to whether to extend that? Clearly, from the views that you have
heard round the table, it is likely that businesses will have
a long-term rather than a short-term problem in the context of
their cashflows, will they not?
(Mr Meacher) Yes, I accept that. Ministers have already
long said that we are in for a long haul. No one, of course, knows
how long that might be, and, of course, there are discussions
which are in the media and are well understood to be taking place
about the best strategy at this point to try to contain the disease,
which could, in the next few weeks, have a significant impact.
That is all relevant material in deciding whether to extend it.
It may well be extended, but, as you know, Government is very
cautious and we concentrate on the immediate period. I would estimate
that certainly two months into the three-month period we most
certainly have to take a view as to whether to extend it.