Introduced in 1996/97, the grant scheme subsidises investments in storage, handling and fixed disposal facilities for manure, slurry and silage effluent. It has applied within the 68 NVZs designated in England and Wales under the 1991 EC Directive on protection of waters from nitrate pollution.
Figures released by the Ministry of Agriculture earlier this year showed that the scheme has been unattractive to farmers, with only £317,000 of the £2.4 million available in the three years to 1999/2000 taken up (ENDS Report 304, p 41 ).
At the farming summit in March, the Prime Minister announced that the grant rate was to be increased from 25% to 40%, and annual funding under the scheme in England increased from £0.8 million this year to £4.5 million from 2001/02 (ENDS Report 302, pp 26-28 ). The new regulations implement the higher rate of grant following clearance under EC state aids rules.
Explaining the regulations to a Commons Committee on 7 November, junior Agriculture Minister Elliot Morley said: "The relatively modest grant level of 25%, coupled with the adverse economic climate for farming, has resulted in farmers 'making do' with their existing facilities and, in some instances, exporting surplus farm waste to other holdings.
"The proposed expansion of NVZs early next year will make it more difficult for farmers to continue with this method of exporting, as the number of farmers subjected to the NVZ restrictions will increase." Mr Morley predicted that demand for grant-aid "will increase dramatically" as a result.
Expansion of the number and area of NVZs is being forced by the European Commission, which is taking the UK to the European Court of Justice for failing to implement the 1991 Directive properly (ENDS Report 287, pp 4-5 ). The Government has already conceded that it is guilty as charged, but announced at the farming summit that it would be asking other Member States to join it in pressing for a relaxation of the Directive.
However, the programme for designating additional NVZs has slipped behind schedule. The Government said earlier this year that it would consult in September on new designations. It may be hoping to drag out the issue until after the election for fear of inflaming the farming community.
In Scotland, where additional NVZ designations are also being made under pressure from Brussels, the Scottish Executive recently consulted on the introduction of a farm waste grant scheme akin to that south of the border. 2 A similar move is also under consideration in Wales.