Agriculture: CAP Direct Payments

Lord Tomlinson Excerpts

Tuesday 27th July 2010 Lords Chamber

[Lord De Mauley]

My Lords, I acknowledge the first half of my noble friend’s contention, but in my initial Answer I explained that the report data are somewhat out of date and that there have been fairly substantial changes in the economic position for farmers since then. My noble friend is right that the financial perspective for 2014 to 2020 will be negotiated in a scenario of much more limited financial resources being available than before. The Government’s view is that Pillar 2 represents a more effective use of those limited resources. However, I am really not expecting direct payments to disappear immediately under the next financial perspective.

[Lord Tomlinson]

As the noble Lord is a member of a Government who are more and more committed to the role of market forces but is not committing himself imminently to change, what plans do he and the Government have for introducing market forces to agriculture, thus contributing to the savings that they are looking for in every other area of public expenditure?

[Lord De Mauley]

My Lords, no one thinks that this is going to be easy. In my experience, however, there are very few farms that can claim that they have exhausted all potential for making more efficiencies, so I take the noble Lord’s point. Many would benefit from training to improve skills, especially in business management, cost reduction and better marketing strategies, such as through producer organisations. As a whole, the EU has been falling badly behind its global competitors in productivity growth over the past 30 years and the Government are working hard on how this can be reversed.