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Thursday, 22 February, 2001, 15:29 GMT
Countryside in crisis

The foot-and-mouth crisis has focused attention like never before on farming and the countryside where an entire way of life is under threat.

Agriculture is a devolved matter dealt with by the respective assemblies in the regions.


FARMING

Even before the outbreak of foot-and-mouth disease, British farmers had been experiencing one of the worst agricultural slumps on record.

In 2000, official figures show that income from farming dropped for the fifth successive year.

Farm income changes 00-01
-13%: All types
-15%: Dairy
+2%: Hill cattle/sheep
-5%: Lowland cattle/sheep
-25%: Cereals
-21%: Other crops
+204%: Pigs/poultry
-2%: Mixed
Source: Maff
The latest Farm Business Survey, produced by the Ministry of Agriculture, Fisheries and Food, has put farming incomes at an average of 5,200 - a 10% fall on the previous year and a two-thirds fall on five years ago.

National Farmers' Union president Ben Gill says 51,000 farmers and farm workers lost their livelihoods in the two years to June 2000, the "biggest exodus in living memory".

The overwhelming cause of the problems faced by agriculture and the wider countryside has been the strength of the pound which has opened up the UK to cheap imports.

At the same time, the value of direct support from the EU - around 40% of total farm income - has fallen because of the weakness of the Euro, in which it is measured.

This was exacerbated by the EU ban on British beef in the wake of BSE, a collapse in world commodity prices, higher oil prices and environmental factors such as floods.

These medium-term developments have affected the long-term viability of agriculture and the countryside, say farmers.

For instance, the labour force has been falling but farm sizes have been increasing, changing both the demographic shape of the countryside and its environmental quality.

An NFU survey suggested nearly half of hill farmers believed their children were leaving agriculture because of low incomes and instability.

This, say farmers, affects the wider rural economy, including the sustainability of village life, rural post offices, and other business and services.

The relative decline in the strength of small-scale farming has also put more power in the hands of the large food processing firms and supermarket chains, says the agriculture industry.


THE POST OFFICE

One of the key concerns for the countryside lobby is the uncertain future of approximately 10,000 rural Post Offices.

The government wants to pay pensions and benefits directly into bank accounts rather than over the counter at post offices.


It's far from certain that post offices will be able to raise investment ... the Government's pledge appears to be meaningless

The Countryside Alliance
The Countryside Alliance, the ad hoc lobby group of rural life organisations and pressure groups, warned that this would have a massive impact on the rural post office network.

The government has since accepted that the move is likely to deprive two fifths of post offices of 40% of their income, though the government says the plan is essential to modernising the service.

Barclays Bank, which made a profit of 2.64bn, was heavily criticised in 2000 as it closed 170 branches, leaving many communities without a bank.

Other high street banks have made similar cuts.

As banks close, rural people are forced to go into larger towns to get cash and conduct business or simply to buy shopping.

Without post offices to handle cash in the place of banks, say campaigners, village economies will collapse.

The race is now on to establish new services to allow rural post offices to survive.

The government's plan includes:

  • A proposed universal banking service to allow customers access to their money at any outlet.
  • Internet access within post offices to help bridge a "digital divide" between urban and rural areas
  • A One-Stop-Shop for services from other government agencies, something that already exists in many post offices

    The Post Office has welcomed the plan but has warned that 1,000 closures remain "unavoidable".

    The response from the banks has been mixed.

    Some are already involved in schemes with rural and urban post offices.

    But members of the British Bankers Association have appeared luke-warm over the proposal.

    The Countryside Alliance said that it is "far from certain that post offices will be able to raise the investment for the new role.

    "The Government's pledge to step in to prevent 'avoidable closures' appears to be meaningless."


    GOVERNMENT POLICY

    Labour's agriculture minister told farmers this year that he had long acknowledged that incomes were low and that he didn't "go around minimising the problem".


    Labour do not merely refuse to discuss the crisis; they refuse to do anything about it, or, on the rare occasions when they do, they make matters worse rather than better

    Conservative agriculture spokesman Tim Yeo
    But he added that while the government has devoted around 1.2bn to short-term measures, the government could not "buy the problems out".

    Labour also says that it has been acting on the burden of regulation - an issue that has attracted stiff attacks from opposition parties.

    But Labour in government insists that it has moved to meet the concerns of the countryside.

    Its Action Plan for Farming (March 2000) pledged 200m nationwide to alleviate the crisis in prices.

    The government also pledged to push for further reform of the European Union Common Agricultural Policy which, critics say, works against British farmers' interests by encouraging over-production rather than environmental management.

    Ministers say they have already secured 66m of EU compensation for farmers, and later announced steps to help them over fuel prices and transport costs.

    However, Conservatives say UK is the only EU member not fully to claim compensation set aside to deal with fluctuations in the euro against other currencies.

    They say that this is because the Treasury under Chancellor Gordon Brown is not prepared to pay its share of the compensation package.

    Labour says the Conservatives' current spending pledges mean that they could not afford to take this money, even though they say they would.

    The government says that the action plan has now been further underpinned by an extra 300m to take the programme forward for three years.


    RURAL WHITE PAPER

    The Rural White Paper of November 2000 aims to deal with many countryside issues in one go, though the question of hunting is being dealt with separately.

    The paper has five key themes:

  • Improving services
  • Tackling poverty
  • The rural economy
  • Countryside and wildlife
  • Choice for local people

    The headline measures included 100m for rural health centres and almost double that for public transport subsidies.

    As well as putting more flesh on the post office proposals, the government said 15m would also be earmarked for community enterprise programmes.

    If Labour is returned to power there could be changes to planning laws to allow farmers to diversify their businesses - something that has met with a mixed response - and also an end council tax rebates on second homes.

    This additional income, largely drawn from city residents with second homes, would go straight back into affordable housing projects.

    On rural crime, Labour says that it has devoted an extra 15m to rural policing this year and 30m a year for the next three years.

    The Council for the Protection of Rural England (CPRE) has questioned the thrust of the white paper, saying that its housing proposals contradict the planning guidance in the urban white paper and would weaken the protection of farmland from development.

    But many farmers have welcomed the move, saying that it would allow them to introduce other parts of the food production chain into their business, such as packing.


    OPPOSING VIEWS

    The government's own "Better Regulation Taskforce", headed by the Labour peer Lord Haskins, has urged the government not to impose European environmental regulations on farmers before other EU members have also complied.


    We should be a little bit less enthusiastic about rushing into introducing regulations ahead of other countries in Europe

    Lord Haskins, Taskforce chairman
    One of the taskforce's main complaints was that Whitehall would take Brussels directives and add "gold-plating" in the form of layers of regulatory detail".

    But the Conservatives say that it has taken the Labour party less than four years to show that it is "ignorant of the issues and problems that are crippling British agriculture".

    The party says that its deregulation commission would slash regulation and it has called for more action to ensure that young farmers are well positioned to take over businesses.

    Labour has responded that it believes that proposed Conservative cuts in food safety regulation would jeopardise the livestock industry once more and prompt other nations to take action against the UK.

    Liberal Democrats say that policies must be focused not only on revitalising the rural economy but ensuring that it is environmentally sustainable.

    This would include encouraging local processing of farm produce and support for marketing co-operatives.

    Turning to the broader issue rural affairs, the party says that there should be more support for rural schools, community hospitals, and schemes to build low-cost homes for first-time buyers.

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