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Hill Livestock Compensatory Allowances

Volume 13: debated on Thursday 19 November 1981

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asked the Minister of Agriculture, Fisheries and food whether he has completed his review of hill livestock compensatory allowances; and if he will make a statement.

The hill areas of Britain are of fundamental importance to British agriculture and the Government are determined to retain confidence on hill farms. Last year hill farm incomes had recovered only in part from the very difficult conditions of 1979, and we made further increases in the hill cow allowance and the higher rate of hill sheep allowance. These enhanced the benefit of our action the previous year when we made the largest ever increases in the hill livestock allowances paid under the Community's less favoured areas directive. This year's review has shown further improvement in hill farm incomes, but we are concerned about the level of hill fanners' incomes in real terms. In particular, the hill beef herd continues to decline, although at a lower rate, and we hope that the level of aid I am announcing will be of assistance.My right hon. Friends and I have completed this autumn's review of economic conditions in the hill livestock sector in conjunction with the farmers unions. We have decided, subject to parliamentary approval, to increase the allowances for hill cows by £2 from £42·50 to £44·50 per cow. With the increases made by this Government in the last two years and the suckler cow premium introduced last year, this will mean that the amount of aid per qualifying hill cow in 1982 will be 96 per cent. higher than in 1979.The substantial benefits from the Community's sheep regime are now being felt in the hill sheep sector, both directly through the premiums paid under the regime and indirectly through better store market prices. We have decided to leave the higher and lower rates of hill sheep allowance unchanged in 1982 at £6·25 and £4·25 respectively.The total level of aid to the hill livestock sector, including the suckler cows premium, will be £101 million in 1982.Draft regulations to implement this increase will be laid before Parliament. The proposed rates involve additional estimated costs of £25 million in 1981–82 compared with the existing provision. This sum has been charged against the contingency reserve and will not add to total public expenditure. Supplementary Estimates will be presented in due course.