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Outgoers Scheme

Volume 77: debated on Monday 15 April 1985

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asked the Minister of Agriculture, Fisheries and Food if he will make a statement on progress made on the outgoers scheme for dairy farmers.

[pursuant to his reply, 3 April 1985, c. 63]: Milk producers are being given a secondchance to enter the outgoers scheme. Both those who did not apply last year and those who did not accept the initial offer may claim the payments for going out of milk production. The scheme is however being reopened for a limited period only. The necessary application and claims forms may be obtained from the Ministry's divisional offices and should be completed and returned by Friday 3 May 1985. Claimants will have to stop selling milk by Friday 7 June 1985 at the latest. The Milk Supplementary Levy (Outgoers) Scheme came into operation on 24 July 1984. Producers who wished to surrender their quota as outgoers were invited to make application to join the scheme by 28 August 1984. The aim of the scheme was to take in 2·25 per cent. of the quota for England and Wales, a total of 289 million litres. Initially a total of 4,826 producers applied, offering to surrender four times this amount of quota. So far 1,463 producers with 234 million litres have confirmed their wish to give up milk production and a few cases have yet to be settled. The majority however have decided to stay in milk production after all. This allows a second chance to be offered to producers generally.Any producer who sold milk in England and Wales and qualified for a quota allocation from April 2 1984 can apply provided that they have not previously benefited under the non-marketing of milk, dairy herd conversion or farm structures (payments to outgoers) schemes. Claims from tenants will need to be supported by their landlords. Outgoers' payments can be either:(i) For loss of profits in the five years immediately after the date on which production of milk for sale ceases. Suchpayments will be made at the rate of 2·6p a year for each litre of quota which are to be given up under the scheme; or(ii) As compensation for the surrender of quota at the rate of 13p per litre, with a total lump sum due being paid outin five equal annual instalments.Payments under the scheme will be taxed as income if they are made in respect of loss of profits or as capital, if they are made as compensation for the surrender of quota. In each case the first payment will be made as soon as possible after the date on which milk sales have ceased and subsequent payments will be made at yearly intervals thereafter.When outgoers submit their claims they will have to give several undertakings. The most important of these are that they will give up their quota allocation in its entirety and that they will not be involved with the production of milk for sale as long as the Community milk quota regulations last.