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Farming (Competitiveness)

Volume 508: debated on Thursday 25 March 2010

The Government are committed to maintaining a thriving, competitive and sustainable agri-food sector in partnership with the supply chain, as part of our Food 2030 strategy. Reforming the common agricultural policy will improve the industry’s ability to respond to consumer demand. We are providing £300 million between 2007 and 2013 to improve competitiveness in the agriculture and forestry sectors through the rural development programme for England, and over five years we are investing £80 million in research and development, of which £50 million is new money.

Whatever the Government may say, it remains a scandal that, according to both Farmers Weekly and Farmers Guardian, the latest European Union fines for late payments by the Rural Payments Agency amount to £90 million. Does the Minister not accept that the money would have been better spent on ensuring fair competition for our farmers, particularly when it comes to imports?

As my right hon. Friend the Secretary of State said a few moments ago, according to the latest figures relating to RPA payments under the single payment scheme, it met its two formal targets, which were to pay 75 per cent. by value by 31 January and 90 per cent. by value at the end of March, ahead of schedule. The latest figures show that, as of Tuesday 23 March, 93 per cent. of customers have been paid and 93 per cent. of the fund has been paid. The RPA’s performance has improved year on year.

We certainly do not want to pay unnecessary fines to Brussels. We want to support the food and agriculture industry, and we will continue to do so.

The National Association of Cider Makers has led the way on responsible drinking. How has the Minister got the nerve to tell the House all those nice things about agriculture when yesterday, on the same spot, the Chancellor increased duty on cider by 10 per cent. over inflation? There are 600 businesses in Herefordshire alone producing this exclusively British drink. How will the Minister ever persuade anyone to take anything he says about British agriculture seriously again?

I recognise the hon. Gentleman’s concern about the industry in his constituency. Historically, however, cider producers pay lower rates of duty than other producers, and the rate that they will now pay is about half that paid on beer. The smallest UK cider producers will remain exempt from the duty increase—they are subject to a small cider makers’ exemption which applies to makers who produce fewer than 7,000 litres a year—and we estimate that, as a result, nearly 400 UK cider makers will not be affected by any of the changes announced yesterday by my right hon. Friend the Chancellor.

As has already been pointed out, the competitiveness of farming has been affected by the appalling record and performance of the Rural Payments Agency. There has been considerable investment in IT, but it has failed to remedy all the failures. What steps has the Minister taken to improve the efficiency of operations managers in the RPA, so that they can balance resources to meet their work loads and thence deliver improved performance for their customers?

The RPA is under extreme pressure to ensure that it makes efficiency savings, as is every Government Department and Government organisation. Online pre-populated application forms will be available this year, and drop-in centres will be opened for farmers so that they can speak face to face to RPA officers, because we want to make sure that we have an even smoother passage in terms of concluding the mapping this year and next year’s payments. Clear improvements have been made year on year since the debacle of the 2005-06 regime, and I hope this year’s efficiencies will be apparent to all farmers. We are also having regular meetings with the RPA and stakeholders to try to make sure that everybody is aware of all the possible improvements.

Order. We now urgently require brevity, a legendary example of which will be provided by Mr. Jim Paice.

Anything is possible, Mr. Speaker.

Our farmers produce some £7 billion-worth of food, which, as the Secretary of State has said, supplies an £80 billion food processing sector. Farming also provides the basis for our £14 billion rural tourism industry, and, in total, is responsible for about 5 million jobs. Yet last week the Government stated in their skills document that not only agriculture, but the food sector too, are of low economic significance. Do they have any idea how damning that is after 13 years of a Labour Government?

As my right hon. Friend the Secretary of State has said, we recognise the significance and importance of the food-agri sector to the UK economy. I mentioned earlier the support we have put in place for it, such as through the rural development programme for England and our attempt to reform the common agricultural policy. The Dairy Supply Chain Forum, the Fruit and Vegetable Task Force and the Pig Meat Supply Chain Task Force also provide sector support, and we are also investing in both the skills agenda and research and development. As outlined earlier this month, we have reduced regulation by more than 20 per cent. as well. We are doing what we can, therefore, but we know there is more to do, and we will continue to try to do it.