20 September 1996

Suckler men stare bankruptcy in the face

BEEF farmers face bankruptcy unless the government takes into account the devastation caused to beef producers in less favoured areas and increases the hill livestock compensatory allowance payments, argue opposition MPs.

Paul Tyler, Liberal Democrat rural affairs spokesman, said the governments annual HLCA review must be based on the present and likely future income figures in the light of the BSE crisis.

In the past, HLCA rates have been determined by government on a retrospective assessment of the hill economy, using figures from previous years to justify the level of payment.

But following a recent tour of Scottish farms and meetings with hill farmers up and down the country, Mr Tyler said it was vital the government looked at future prospects to save farmers from oblivion.

Gavin Strang, Labours shadow farm spokesman, said it was vital support for hill farming was maintained to halt rural depopulation in upland areas: "If there is no hill farming, there is nothing else. Tourism depends on the success of upland farming."

Dr Strang said the plight of hill farmers facing weak returns from suckler sales had been driven home to him by farmers during visits to the key livestock areas of Wales and the north-west.

While sheep farmers have had a buoyant summer, enabling some LFA farmers to offset losses in the beef sector with profits from lamb sales, Dr Strang stressed there were many upland farmers who relied on suckler sales for their annual income.

"It is these farmers who are facing a real crisis, and these who need the support," he said.

Ieuan Wyn Jones, Plaid Cymru farm spokesman, said less favoured area beef finishers would also be badly hit, due to the governments decision to cut the top-up rate on slaughtered animals from 10 to 5p/kg.

"Many producers in Wales finish stock in the autumn, and they clearly did not benefit from the higher compensation rate which ran until the end of June."

Mr Wyn Jones added that he would like to see the government match the £29m European beef marketing payment scheme grant for farmers who sold stock after the end of June. That attracted nearly 29,000 claims from UK farmers in respect to 430,000 animals. And he called for government to spend more money on beef promotion to help lift consumer sales.