WEDNESDAY 28 NOVEMBER 2007

Ms Fiona Bryant and Mr Ian Baker

  Q400  Viscount Ullswater: Just on the budget, I think you say in your paper that in the political climate you do not see any chance of the total budget being expanded and I think also you make a comment about co-financing as being unrealistic. Maybe you are being pragmatic in that sense or maybe you know something that we do not. Tell me, do you have any cooperation with organisations of a similar nature to yours around Europe, and what reaction do you get from them about the financing of either Pillar I or Pillar II? Do you see any opportunity—and I think in answer to the Chairman you mentioned that you did not feel that there was too much future in looking at social funds and regional programme funds for financing the agricultural sector?

  Mr Baker: I do not think we exactly said that, no

  Q401  Viscount Ullswater: Perhaps I read you wrong.

  Mr Baker: We will clarify that in the answer to the question. Is that the full question? In terms of the overall budget, we recommend a position where progressively we are moving more funds into Pillar II. This should be based on driving the process of change with the sector. As to the overall levels of the budget we would be comfortable with, it is not our call in a sense. But we are very clear that there is not enough in the current pot to drive the process of change at the pace that we want to drive it. Looking at other regions and, in particular, at our region and the southeast, are part of a network which goes by the colourful name of PURPLE. This is about peri urban regions across Europe, comprising 13 regions from Warsaw to Dublin to Barcelona to Stockholm in the network. It is fair to say that there is a diverse set of views, but they have reached a position, which we have also signed up to, on CAP reform, which again I can make that available to the Committee. Increased modulation from Pillar I to Pillar II is agreed on by all, including the French and German regions. So I think that is quite powerful, in answer to your question. Finally, in terms of whether farm businesses should be eligible for support from mainstream funds, that is part of the point we were making; we feel that farmers have for too long not been part of that mainstream and it is very hard for us as the rural leads generically within the RDAs to argue for rural funding from the mainstream funds because they say, "You have the rural programme, so we are going to prioritise this in urban areas." Fiona said we are trying very hard to make sure that there are no gaps. I fear there probably are some gaps between the Structure Funds framework and the rural development frameworks because the urban interests and the levels of funding—I think we have something like 55 million within our region for the Rural Development Programme, and the overall funding for our Structural Funds programme is £250 million. We have 80% of our population living in the urban part of the region and it is a fairly obvious bit of maths for that to be the priority. Therefore the responsibility sits fair and square with the region to ensure that it does cover the whole of the piece. With the current approach there are too many artificial separations which undermines our argument for trying to gain resources for rural businesses and rural communities.

  Q402  Viscount Ullswater: I heard last week from Wales and from Scotland of the farming economy fragility and also that a lot of the diversification was into bed and breakfast and there was a bed and breakfast notice practically on every farm gate, and therefore it was slightly saturated. Would you see that the CAP has to be the only fund that really supports the social fabric there, or do you think in your view there are other funds that should be touched for that social area of keeping the uplands populated, which I think was their worry?

  Mr Baker: We think—and perhaps there are more uplands in the West Midlands than there are in the east of England, even so not huge—the social fabric is something that requires investment from not just European but also state and local authority funds and by far the largest proportion is available through the local authorities. What comes through the national and European resources is really the icing on the cake. Really it is the same answer as before, we want to see rural areas getting their fair piece of the action, and by having programmes which are just rural as opposed to focusing on the agricultural sector, you can undermine the provision of the right sort of support in the right places. For instance, if you have a problem with regard to retaining your upland communities—and I am sure in the Lake District, from having worked there, that is an issue—that is something that needs to be addressed through the funds which go to address the social fabric across the whole of your county or your region. Trying to get essentially an agricultural mechanism to do that job is just pushing the thing too far, I think. I do not know if you want to add to that?

  Ms Bryant: Our region is a very rural region and I think there are issues in terms of access to other farming, as I outlined, but that was more on a national basis. That is another reason for requiring the regional flexibility in that very much EDA is obviously going to be responsible for managing the ERDF programme in the region over the next seven years as well. What we have done is very much align it to try and ensure that the thematic approach we want in supporting a low carbon economy is going forward jointly between RDPE and ERDF. So, for example, we are not allowed to match them because that is regulatory rules; but what we will do is try and do joint projects where we may put in large scale infrastructure for renewable energy through the ERDF but the supply chain contracts going into that and the collaboration support and government training support for farm businesses in meeting those contracts will be done through RDPE. There are issues around the social fund and particularly skills and training, in that government requirements of LSCs are very much around NVQ levels whereas the land based sector quite frequently requires more training of a vocational type approach. But we are working to provide co-financing that supports projects that do address the farming sector. There are ways of doing it but I think the RDAs and other regional partners—not just us, anyone who is dealing with it—have to be quite canny in finding ways around the rules rather than having rules which actually provide that flexibility and provide that support in an open forum.

  Chairman: Thank you very much indeed. I think we have done it fairly comprehensively and taken a very broad view of what the CAP Health Check is about. Thank you very much indeed; it has been very valuable and helpful to us.