Single Payment Scheme

: I would go further and add that the Minister and the Government need to accept ministerial responsibility. Farmers Weekly of 24 March said that farm debt had broken the £10 billion mark. The level is estimated to be increasing by £13 million a month in interest payments alone. As I have mentioned, 90 per cent. of English farmers are waiting for the single farm payment to be paid. Farmers are struggling financially to keep their businesses afloat and the knock-on effect on the agricultural supply trade is dire. Farmers still have to pay bills as they come in but they have received no payments for up to a year and face growing debt with emotional and financial pressure on all concerned. That is particularly so for tenant farmers who are unable to borrow because they have no assets against which to borrow. I want to share with the Chamber representations from the agricultural industries confederation, which is the trade organisation for the agricultural supply industry. It wants us to be mindful of the need for farmers to fund the purchase of inputs ranging from animal feeds to sprays and fertilisers when they face a major hole in their cash flow due to the lack of single farm payments. To date, DEFRA does not seem to have grasped the seriousness of that. A rule of thumb in the view of the confederation is that the industry has a month-on-month level of indebtedness of around £50 million. That figure was established with some certainty at the time of the foot and mouth outbreak in 2001. It relates to bills that farmers have outstanding at any one time in normal monthly credit arrangements. During the foot and mouth epidemic, that monthly figure rose to £80 million and the confederation believes that there has been a 35 per cent. increase in the level of indebtedness between farmers and their suppliers since the end of 2005. That is in addition to the increased level of borrowing reported by clearing banks. Lloyds TSB recently estimated that increased borrowing due to delayed payments was costing the agricultural industry around £8 million a month. That scale of increase inevitably will place severe pressure on the agricultural industry's fundamental ability to operate and the agricultural supply industry is concerned that that artificially created situation will inflict lasting damage on the UK's agricultural industry and the livelihoods of those working in it. I want to ask the Minister a number of questions reflecting what right hon. and hon. Members have said this afternoon. Why did Ministers not act sooner to address the problems at the Rural Payments Agency? We and a number of stakeholders gave information on a number of occasions, not least from the Select Committee report onwards. Will Ministers now apologise to farmers for the real stress and financial costs of the delays? What lessons will be learned from the announced RPA review and why is the review not examining what went wrong over the past year? What assurances can be given that the same mistakes will not be made again? Why is there no stakeholder representative from the industry on the review team and why is the chairman of the review someone from DEFRA rather than an independent person outside government? Will the review be published in its entirety and promptly when it is finished and will Parliament have the opportunity of debating it? The Government must ensure that farm payments are paid immediately and in full. An interim payment of 80 per cent. in the next three weeks would be particularly welcome. It is disappointing that the Secretary of State in response to an urgent question from my hon. Friend the Member for South-East Cambridgeshire (Mr. Paice) this week did not promise interim payments and has so far stated only that windows for payments remain open until the end of June. Will the Minister confirm that there will be immediate payments or that the payments will be made in full? It is unacceptable, but inevitable, that tens of thousands of applicants will have unvalidated entitlements from the 2005 single farm payments and not be paid by the time they must apply for 2006. Farmers feel badly let down. The Government gave an undertaking that 96 per cent. of the first single farm payments would be paid by the end of March. Farmers consequently budgeted on that promise and have been very badly let down. Possible solutions, which I hope the Minister will share with us this afternoon, are that payments will be made immediately and, if necessary, the Government will override the computer system so that payments can be made manually. Emergency measures are required and payment within the next three weeks is vital. At the very least, the Government should consider paying interest for the delayed loans. Many farmers owe the banks serious money because of the chaos. I am delighted to have secured this debate and I look forward to hearing what my right hon. and hon. Friends, other hon. Members and particularly the Minister have to say.