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Agriculture (West Country)

In a way, I apologise to the Minister, because she and her predecessors have been assailed annually by debates on agriculture in West Dorset. However, I make no apology for the fact that I intend to continue the practice in future years; it is a useful way of enabling the Minister to get a snapshot of admittedly only one location where farming is a crucial part of the local economy and society. As the Minister will be well aware, dairy farming is the preponderant form of farming in West Dorset. Last year, until about November, was the first time that I can remember when my dairy farmers began to think that there might be some light at the end of the tunnel for farm-gate prices, because for most of the past 13 years, milk has sold at below 20p a litre at the farm gate and for a brief moment, it did not look like that, somewhat offset by what were then sharply increased input costs of various kinds—both for fuel and raw materials, such as feedstock, fertilizer and so on. Unfortunately, however, since November, most of the prices experienced by most of my farmers have fallen by about 2p or 3p a litre, and dairy farmers have now returned to the very difficult position of being unable to cover costs, including capital costs, or to bring in a reasonable income or wage for themselves and those they employ, given the price levels they are able to obtain. It took some years for that happen but it is now feeding through to a significant and, all the indications are, pretty sustained, reduction in output and capacity in West Dorset's dairy farms. For some years the innate, long-term optimism of the farming community—that things would get better at some uncertain date—combined with deep love of a way of life, led people to remain in the industry beyond the point when rational calculation of rates of return would have kept them there. Over the past 10 years, for every farmer—there were many—who sold all or some of their livestock, there were others willing to absorb them. That led to an increase in the average scale of dairy farms and, probably, in average efficiency, which is to be welcomed, although it came with significant social effects, because the driving out of smaller farmers has been another nail in what I hope will never be the coffin of the local village—often the local farmer is the main, or an important, component of the local society. For a while, from a sheer economic point of view, it looked as though concentrations were rising and productivity increasing, which one could celebrate. However, unfortunately the economics eventually came home to roost and people have been moving out of the industry without finding people willing to buy the livestock and maintain capacity. Nationally, we reached a 30-year production low in 2007-08, which is paralleled in West Dorset, and as far as I can see the figures are still falling. Eventually, one might expect supply and demand in the liquid milk market to push prices back up, but clearly there is a great deal of resistance to that among hard-pressed consumers in times of economic difficulties. All in all, on the fundamental economics, the position of my dairy farmers is not good. In addition, dairy farmers now face the very severe crisis of bovine TB, of which the Minister will be acutely conscious. Briefly, it once looked as though pre-movement testing might have had an effect, and the hot-spot concentrations were stabilising or perhaps even diminishing. Unfortunately, however, that is no longer the case. The number of bovine TB reactors is increasing again, and there are some very severe hot spots in West Dorset. Pretty much every week, a farmer tells me another terrible tale of the discovery, or now in most cases the rediscovery, of reactors and probables. That is another pressure pushing farmers out of dairying and out of farming. The animal welfare consequences for the badger and cattle populations are also unfortunate. Nationally, that is causing considerable strain on resources, because of the fiscal cost of purchasing animals that have to be slaughtered. I fear that West Dorset is a large, and likely to be an increasing, contributor to that fiscal pressure. I know that the Minister, her colleagues and previous colleagues whom I and colleagues from other parts of the country have belaboured about this over the years, have expressed a desire to develop the gold standard—a proper vaccine for the badger population. We would all welcome such a vaccine. However, for the past 10 years, I have been hearing that it was about five years off, so I have no more confidence than my farmers that it will arrive five years from now. Even on the optimistic assumption that in five or six years there is some method of vaccination, there is no substitute for an interim cull, although that is not the Government's current position, which I maintain is not responsible in terms of animal welfare, fiscal costs or the costs to my farmers, emotionally and economically. Alas, this is not just a question of milk prices and bovine TB: there is also the unnecessary fact of continuing bureaucratic problems. To exaggerate is no part of my purpose, and I pay tribute to the work of Lord Rooker, who in my experience was the first person in a long time to enter the Ministry of Agriculture, Fisheries and Food or the Department for Environment, Food and Rural Affairs who really tried to get to grips with the single farm payment system. I have exchanged so much correspondence with him that I feel that I know him extraordinarily well. He had an effect, and to some degree payments caught up—I pass over in silence the whole saga of the ghastly mapping exercises and the computers that still do not speak to one another properly. A new problem, which I hope that the Minister will address, is coming over the horizon and beginning to affect my farming constituents quite significantly. As the Department or the Rural Payments Agency have caught up with the past, they have begun to discover that the past was not as accurate as they once thought that it was. They have started to ask farmers for repayments of overpayments, of which neither they nor farmers had previously been conscious. Farmers of mine are being asked for money from 2005, 2006 and 2007. Some of the cases are not meritorious; at a certain point, when the farmer has done everything in his power to provide accurate information and the RPA has made a series of errors, it becomes unreasonable, as with tax credits, to try to claim back the money. I warn the Minister that there is likely to be much pressure from me and, I suspect, other similarly disposed Members of Parliament, about that issue, although I accept that in some cases the RPA was misled or that farmers made mistakes. However, where farmers have tried to do everything in apple-pie order, and there has been an error on the other side, it is a bit tough on the farmers to try to claim back the money. However, the bureaucratic problems are not restricted to the single farm payment. Another such problem relates to field records, with some 23 now having to be kept for each field. None the less, that issue pales into insignificance compared with the nitrate-vulnerable zones saga. I have said publicly on various occasions—I recently made a speech about it in the context of wider issues on regulation—that the whole NVZ apparatus is manifestly barmy. It constrains farmers from distributing slurry in the so-called wet months, including on the dry days of wet months, and allows them to distribute it during the so-called dry months, including wet days in dry months. That is not a rational process. When evaluation is carried out some years from now, I am sure that we shall discover that the NVZ direction has been translated in England in a way that has increased rather than reduced the nitrates in our rivers. Therefore, the system is crazy. Let me park that issue because I know that the Minister only inherited the system and did not invent it herself. I pity her because she will go down in history as a Minister who presided over a barmy system. None the less, as the system is in place, there is at least one set of people who should not suffer from it, and that is the farmers who did not want it, who hired people such as myself—not that they paid me extra but they pushed me into action—to campaign against it. They also organised the National Farmers Union to campaign against it, and they themselves made powerful arguments against it. They are the last people who should suffer. Putting up a serious slurry store on a significant-sized farm costs about £50,000. The whole apparatus of pillar 2—as I have just heard from the Secretary of State—is not contributing a single penny to that cost. Therefore, we have a totally non-productive investment in a wildly underinvested industry, on which the Government have repeatedly commented, as has the Chatham House report. The unproductive investment is compelled in regulation and exists because of a barmy system that did not need to be there in the first place and that costs the farmer £50,000 to comply with. Moreover, neither the Minister nor I can give the farmer the slightest advice on how to raise the money because there is not a bank in Britain that will give £50,000 for unproductive investment in a farm that is strapped for cash. That is a really serious problem that will come home to roost for the Minister in a very straightforward way—more of my constituents will leave the industry. Recently, a constituent who has farmed for years told me that he is now on the way out. The straw that broke the camel's back was slurry. The same thing will happen all over West Dorset, and in many other places. The south-west of England is very wet, and there are real problems with NVZs. I have campaigned for years about the need to deal with nitrates, but forcing farmers to keep slurry stores so that they can dump the stuff on wet days in dry months at great cost is not the way to do it. That is barmy. Something must change. The very least that needs to be done is to find money from pillar 2 to pay for the slurry stores. It is not the right answer because that is to change the framework, but given that the framework is already there, the slurry stores must be subsidised. In conclusion, I want to raise two issues to which I hope the Minister and her colleagues will attend. The first is bluetongue. The Government did well on bluetongue last time round, although neither they nor Conservative Administrations have had such a happy history with other diseases. The bluetongue vaccinations were ordered on time and were well distributed and the disease was controlled, but I fear that there is not sufficient protection against the new strains. I have corresponded with the Secretary of State about that. I am conscious that unless we have multi-strain protection pretty early on, we will hardly be able to surround the Channel ports and the patches of our coastline between the ports with large nets to catch the vectors. We will be under attack from minute objects and we must deal with them in any way we can, which means proper vaccination. I hope that the Minister is pressing forward with ordering to ensure that there is not a lag when we discover that the vectors carrying new strains are heading our way. Finally, I turn to research and development. I have mentioned that the agriculture industry is probably the most severely underinvested industrial sector in Britain—not that there are no problems of underinvestment in many other sectors, but agriculture is peculiarly ill affected by it. Farmers do not have the capacity to carry out fundamental research. Research must be undertaken at the level of DEFRA and the other agencies. One area of concern is beekeeping, which is of immense horticultural and ecological significance in West Dorset and many other parts of the country. Over the years, I have corresponded with Ministers about it. I do not think that there is any doubt in Ministers' minds that colony collapse is an increasing problem. Leave aside the economic and biodiversity effects, the sheer fiscal cost of widespread colony collapse, and the serious effect on horticulture and agriculture as a result, will beggar the tiny amounts of money that are currently invested. I know that an extra £400,000 has been invested, but that is not enough. I understand the causes. When DEFRA found itself fined by the Commission because of the RPA's delays on the single farm payment, it had to cut down somewhere, and research looked like an easy target. However, it is not a cost-effective place to be reducing investment. For tiny numbers of millions of pounds, huge additions to our knowledge could be gained, and there would be a real chance of preventing colony collapse. Now is the time to address the problem. I know that times are tough; we are in recession and I understand the pressures, but I believe that we are storing up for ourselves a considerable liability if we do not act.