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Agricultural Policy

I will make some progress, if the hon. Gentleman does not mind. This is the first time since 1998 that the Committee has discussed agriculture. With the reform of the common agricultural policy, which is high on the Government’s agenda, it is essential that we have the opportunity to talk about the issues that impact on our rural communities. CAP reform will have a significant impact in Wales, and it is vital that Welsh interests are considered as we help shape a CAP that will serve the interests of the whole of the UK and provide for a more sustainable farming community. The CAP budget cannot keep increasing when public finances are so stretched across Europe, and I hope that we all agree on the need to encourage efficiencies and the move towards a self-sufficient farming sector. Although that will be a challenge, we must move the industry away from direct support over the long term. Doing that will require using CAP support to invest in measures that aid innovation, which in turn will help our agricultural industry to grow and concentrate on the things it does best. The Government are committed to maximum engagement within the EU, and we are demonstrating real leadership by developing proposals and alternatives that will benefit farmers across the whole of the UK and in Wales. As we know, the UK is recovering from the biggest financial crisis for generations. We are affected by inflation driven by global commodity prices and a debt crisis in the euro area, and the full scale of the 2008-09 crises has now become clearer. Those financial difficulties are being felt across the UK and across all industries, but they are having a particular impact on our rural communities and the agricultural sector. When I talk to businesses in rural areas, they tell me that the economy is their biggest concern. The Government’s actions to reduce the deficit and rebuild the economy have helped to restore stability and bring down interest rates to record lows, and they have benefited businesses and families. I am sure we all agree, however, that unemployment in some parts of Wales has been higher than we would all like for longer than we would all like, and rural communities are no exception. There has been some good news in the agricultural sector, however. The latest labour market statistics show that 39,000 people were employed in Wales in the agricultural, forestry and fishing sector, which is a rise on both last year and last quarter. We have made it clear that economic growth must be led by the private sector, and the agricultural sector clearly has a key role to play. It is a significant contributor to both the UK and the Welsh economy, and it provides employment for large numbers of people in our rural communities. Farmers also have an important role to play in encouraging tourism—a point to which the hon. Member for Aberavon alluded—and supporting employment in a number of related industries. Farmers are the cornerstone of our food and drinks industry, supporting an infrastructure of processing, distribution and retail businesses. We have got a lot to be proud of. There are many iconic products that place us firmly on the food map. Only last week—I am looking at the hon. Member for Ynys Môn—an application was made to protect the name of Anglesey sea salt under the EU protected food name scheme. As it is a product that I regularly use, I hope it gets that nomenclature. If it does, it will join Welsh beef and Welsh lamb. Promoting the excellent food we produce here in Wales is essential if we are to grow the industry further, so the work that the Welsh Government are doing to attract official status for products such as Carmarthen ham, north Menai strait mussels and laverbread is an important part of the equation. I know from my many visits to the Royal Welsh show how many hon. Members on the Committee also attend that show, which has record gates—increasing gates—and where we are able to see the huge promotion of good Welsh products from our agricultural sector. Last year, I asked the Under-Secretary of State for Wales, my hon. Friend the Member for Clwyd West, to lead a taskforce exploring the major issues affecting rural communities and economies across Wales. Although the matter is largely devolved, I thought that we in the Wales Office should understand the current situation. He visited rural areas to discuss at first hand the concerns of local farming and agricultural communities. The work reflected the complexity of devolution, because many of the areas that affect rural life fall under the Welsh Government. Respondents to the taskforce highlighted a number of important issues, which were touched on in the question and answer session, such as broadband supply, fuel prices and bank lending, and I believe that we have made real progress on all of them. Broadband, as we all know, is absolutely essential to help businesses grow. The evidence presented to the taskforce showed that connections in our rural areas were slow or sometimes completely non-existent, which is why the investment in broadband is so significant and important. The Government have provided Wales with a total of £56.9 million to help bring broadband to everyone, and to bring superfast broadband to 90% of homes. I am sure the Committee will be pleased to hear that earlier this week I had an excellent meeting with the Welsh Minister for Business, Enterprise, Technology and Science, and I was pleased to hear how that money is being used. It will bring improvements in previous broadband not-spots, and it will support several successful rural projects. There we have a good example of our two Governments working very well together in the interests of Wales, and I am looking forward to hearing of more and more rural areas that are connected.