Shortly we will also be publishing a review—three years on—of the Rural White Paper alongside a study of economic performance in rural areas from Birkbeck College. In the New Year, drawing on the three reports, we expect to publish a "refreshed" rural strategy.

I attach a copy of Lord Haskins' recommendations, but will single out for comment a few key issues.

NEXT STEPS

My first priority is an immediate full review of rural funding schemes to provide a clearer and simpler framework for applicants and to achieve a reduction in bureaucratic procedures.

In the principles he published in the summer Lord Haskins called for a clearer division of responsibility between policy making and delivery. Government's clear role is to set the framework for policy. But is clear that policy advice can be particularly valuable when it comes from those involved in delivery. I attach huge importance to independent advice from my Department's agencies and partners. I do not intend to lose that advice.

AN INTEGRATED AGENCY

A major challenge in the 21st century is the effective stewardship of land in England against the need to conserve and improve the natural environment, maintaining and enhancing biodiversity. Lord Haskins recommends bringing together elements of the work done by English Nature, the Countryside Agency and the Rural Development Service where those functions will most enable the agency to reflect its new remit. I accept that broad recommendation. We will also consider how to achieve alignment of the Forestry Commission with the integrated agency.

The integrated agency will build on the successes and expertise of its constituent parts, such as English Nature's worldwide reputation on biodiversity matters. It will create a single, stronger authoritative body, accelerating integration of work on biodiversity, natural resource protection and landscape issues in order to improve the environment across rural, urban, marine and coastal England. It will provide independent policy advice and implement policy within the framework of the Government's approach to sustainable development. I will look for a legislative opportunity as soon as possible to formalise arrangements for the agency, and am pleased the constituent bodies have agreed to work with DEFRA to make practical progress before that point. This will allow continuity for the organisations, their staff and stakeholders, while preparing for the future.

COUNTRYSIDE AGENCY

Lord Haskins recommended the abolition of the Countryside Agency. I do not, however, agree that there will be no role for it. There will be a continued need for a much smaller organisation, with a new, well focused role providing independent policy advice to Government from a national perspective on issues affecting people in rural communities, and analysing and reporting on best practice in the delivery of the Government's rural policies. We also need to build on experience so far on rural proofing and embedding rural objectives in all relevant aspects of government policy.

REGIONAL AND LOCAL DELIVERY

Lord Haskins recommends devolution of the way in which the DEFRA family delivers its policies to achieve greater effectiveness and accountability at regional and local level. My Department will therefore be discussing with the Regional Development Agencies, the Government Offices for the Regions, local government, the Rural Affairs Forum and the voluntary sector how to define new mechanisms for delivering services to rural communities, which will be accompanied by strong and effective performance management arrangements.

Much work will be required to develop these proposals into a practical implementation plan, which we hope to publish in the spring. I want to work in partnership on this with all those concerned to secure real improvements in sustainable development from biodiversity to resource protection. This is not only in the interests of Britain's rural communities, but in the interests of us all.

LORD HASKINS, RECOMMENDATIONS

To improve accountability through a clearer separation of responsibility for policy and delivery functions (see Chapter 4):

DEFRA should review and clarify its rural policy remit in order to ensure that it is consistently understood by all concerned, including those who deliver its policies.

DEFRA's prime responsibility should be the development of policy, and it should arrange for the delivery of its policies through national, regional and local agencies. Policy and delivery functions should be managed separately so that accountability for policy and delivery is clearly defined.

The separation of policy and delivery functions will require DEFRA to consult delivery organisations at the earliest stages in policy formulation and to require the latter to put forward proposals for the effective delivery of policy. In this way the delivery organisations will be more accountable for effective management of programmes, and there should be less duplication of existing regional and local schemes. DEFRA will continue to appoint members of the various boards and to hold them accountable for their performance.

DEFRA policy officials should develop a good understanding of delivery issues through a programme of training and secondments to delivery organisations. An understanding of delivery issues must be given higher priority in the assessment of individual performance. Secondments and recruitment from delivery organisations should also be encouraged in order to improve mutual understanding.

Deliverers should agree targets with DEFRA, working with the Treasury, rather than having unrealistic ones imposed on them by Whitehall. This would include DEFRA's rural PSA. In this way delivery organisations will accept greater ownership of these targets, which will be more achievable and less vulnerable to manipulation. There should be greater emphasis on setting rural targets that are linked to outcomes (such as an increase in species numbers) rather than outputs (such as the number of grants processed).

Delivery organisation should have the maximum flexibility to allocate resources in the most effective ways, whilst keeping the necessary discipline over administrative costs.

DEFRA should agree shared targets with other government departments and their delivery organisations as an essential means of securing better delivery of its rural policy objectives. This will strengthen DEFRA's ability to influence outcomes.

DEFRA should improve the quality of its management information so that it can take better informed decisions and control the administrative costs associated with the schemes and services that it funds.

In pursuit of the objectives of separating policy from delivery and of devolving delivery, the functions of the Countryside Agency should be transferred to the appropriate specialist organisations. Thus:

policy development (including the commissioning of pilots and demonstration projects), together with the promotion of rural proofing would pass to DEFRA and the Government Offices;

social and economic programmes would pass to regional and local networks of Regional Development Agencies (RDAs), local authorities and the voluntary and community sector;

environmental, landscape, access and recreational programmes would pass to the new, integrated agency proposed below (see Recommendation 16);

review of rural proofing, challenge and external advice would pass to a reformed Rural Affairs Forum for England (see below).

In the light of these changes the Countryside Agency would cease to be required as a separate organisation.

To bring delivery closer to the customer by devolving greater power to regional and local organisations to deliver economic and social policy (see Chapter 5):

RDAs should play a key role in the devolved delivery of DEFRA's rural economic and social agenda. They must therefore demonstrate and develop their capacity to contribute to sustainable development in addressing rural needs.

A concordat with DEFRA should be established as a first step towards making the RDAs accountable for their part in achieving DEFRA's policy objectives on rural sustainable development.

The successors to the existing business and farm diversification schemes (the so-called "project-based schemes") that are administered by DEFRA's Rural Development Service under the England Rural Development Programme should become the responsibility of Regional Development Agencies, which will arrange for their delivery.

Regional Development Agencies should have the lead responsibility in co-ordinating public sector rural business support and advice. To that end they should take direct responsibility for Business Links. They should take steps to improve the quality and consistency of business support and advisory services.

Local authorities and local partnerships should assume the main responsibility for delivery of schemes and services to rural communities. They should be fully consulted by DEFRA and the RDAs about any changes to policy and delivery arrangements and should be given the necessary flexibility to address local needs. The potential of Rural Community Councils as partners in community based delivery is underestimated and should be enhanced.

As part of the next round of local public service agreements DEFRA, working with other government departments and the Local Government Association should agree joint Whitehall targets for the delivery of rural policies by local authorities.

To develop a more integrated approach to sustainable land management by rationalising agencies with overlapping agendas (see Chapter 6):

The government should establish an integrated agency to promote sustainable use of land and the natural environment. This is necessary in order to prepare for the expanding land management agenda and to improve co-ordination and service delivery to customers. This would be achieved through a merger of English Nature, DEFRA's Rural Development Service and some functions of the Countryside Agency. Its remit should embrace biodiversity, historical landscape, natural landscape, natural resources, access and recreation.

DEFRA should establish close collaboration between the Environment Agency and the new, integrated agency so that their activities complement each other.

Consistent with the principle of clear separation of policy from delivery functions, the policy development role of the Forestry Commission in England should be transferred to DEFRA.

Following the creation of the new integrated agency, it is logical to integrate or closely align the delivery functions (regulation, incentives, advice) of the Forestry Commission with those of the new agency.

I would also expect DEFRA to seek opportunities to rationalise the various levy-funded organisations that it sponsors in respect of certain agricultural sectors for marketing, developmental and other purposes. There is scope to share resources (administrative, economic and research) between the various boards and to strengthen support for industry programmes if savings are realised through rationalisation.

To improve the coordination of delivery by enhancing the role of Government Offices for the Regions as coordinators and monitors (see Chapter 7):

The Government Offices for the Regions should be given a stronger remit to promote co-ordination of and to monitor rural delivery and to promote rural proofing on behalf of DEFRA. Regional Rural Priority Boards, chaired by Government Offices and including key regional and local bodies responsible for rural regeneration and service delivery, should be set up to provide strategic coordination and monitoring.

Delivery agencies should strengthen joint working through the development of joint regional delivery plans. These would include designated lead delivery partners, agreed joint targets, shared resources and clear accountability for delivery.

DEFRA should consult earlier and more closely with the Government Offices to ensure more coordinated policy development and strategic planning at the national level and reduce the number of strategies that are handed down to the regions.

The Government Offices should focus on their role as coordinators and monitors of programmes affecting rural areas and not be involved in direct delivery. They should disengage from their current role in the administration of EU Structural Funds if and when these are replaced by a national programme of regional regeneration, as the government has proposed.

Regional Rural Affairs Forums (RRAFs), comprising representatives of rural customers and beneficiaries, should become the forums in which national and regional delivery of rural policies is reviewed and reported on. Their key duties would be:

to highlight important issues and priorities for rural development and service delivery;

to comment on the effectiveness of rural development and service delivery in their region and identify areas for improvement;

to comment on the impact and effectiveness of existing policy developments and rural proofing initiatives and to generate new ideas;

to provide leadership to help drive rural development at regional and local level. The RRAFs would receive secretariat services from the proposed Rural Priorities Board secretariat.

To make things better for the customer and get greater value for money for the taxpayer through a more integrated approach to regulation and through simpler services (see Chapter 8):

The Government Offices for the Regions should work with regional and local organisations to develop a more co-ordinated approach to front line delivery. This should include spreading best practice between regions on integrated delivery and facilitation, recognising what is practical and affordable.

DEFRA, as the lead body, should accelerate the development of a "whole farm approach" that will ensure better co-ordination of government regulation and compliance, subsidy, advice and financial incentives linked to farm businesses. This would require:

the development of an integrated rural database linked to land-based business (to which the Environment Agency would have access, subject to resolution of data privacy constraints);

Risk-based self-assessment backed up by audit, preferably using such independent bodies as FWAG and LEAF;

encouraging more rapid uptake of internet use by farmers and rural businesses in general;

the creation of a farm advisory service in the light of the recent settlement on CAP-reform; this would logically fall under the control of the new integrated agency.

In view of the expanding agri-environmental protection agenda, the Environment Agency should agree with local authorities a supplementary role on regulation and compliance. Local authorities should agree standards for delivery with the Agency and call in its support where the extent of a problem or the risks connected with it are beyond the authorities' capacity to manage.

Local authorities should take the lead local role in co-ordinating general regulation and compliance advice on farm premises.

DEFRA should rationalise its inspection functions, integrating them wherever possible with existing regulatory authorities to achieve administrative savings and avoid duplication of skills.

DEFRA should review all rural funding streams and schemes, to achieve a more rational, transparent and comprehensible approach to the administration of financial incentives and to ensure that all new initiatives are consistent with DEFRA's delivery strategy, add real value and do not duplicate.

DEFRA should review and simplify the current procedural rules connected with grants to rural businesses and communities in order to provide greater discretion in the execution and targeting of grants in a user-friendly way, consistent with state-aid rules.

Reporting on progress:

DEFRA should publish progress reports on the implementation of my recommendations in the spring or summer of 2004, 2005, 2006 and 2007.

Our direct mail campaign is continuing, supported by a major advertising campaign on TV and in the press which began in September. We are continuing to work with partner organisations, such as Help The Aged, Age Concern and Citizens Advice, among others, both at a national and local level, to encourage eligible people to take up their entitlement.

There is plenty of time for pensioners to apply for pension credit. To ensure that pensioners do not lose out, there is a 12 month backdating provision until October 2004. This will allow applications to be backdated to October 2003, where entitlement exists, or to the date entitlement begins if this is later.

I am placing in the Library a set of charts and tables showing progress so far, including regional breakdowns of the number of pension credit households. Copies are also available for hon. Members in the Vote Office. From this month onwards, I will provide monthly progress reports on take-up of pension credit.

A copy of the research report "Entitled but not claiming?: Pensioners, the Minimum Income Guarantee and Pension Credit" (DWP Research Report No. 197) has also been placed in the Library. The aims of the research were to further understand barriers to MIG take-up (and, potentially, pension credit take-up), in order to help identify ways of overcoming them, to explore likely reactions to the new pension credit, before its introduction, and to provide data to improve my Department's estimates of take-up of MIG.