What progress has been made in the EU review of the common agricultural policy; and if he will make a statement.

The CAP health check was, on balance, a step towards our long-term view of the CAP. In particular, it removed about half the remaining production-coupled payments. We will continue to press for further reform for the benefit of farmers, consumers, taxpayers and the environment in the forthcoming European Union budget review.

The hill farmers in my Constituency are in an extremely precarious economic situation. Many are being forced to reduce the size of their flocks and herds, or even to contemplate getting out of farming altogether. Does the Secretary of State recognise that those farmers are vital to the well-being of their local communities and the management of our environment? If so, will he ensure that in the next fundamental review of the CAP we retain enough flexibility for the different parts of the United Kingdom to give long-term support to hill farmers?

I agree with everything that the hon. Gentleman has said about the importance of hill farming, and join him in paying tribute to the work that hill farmers do. It is tough farming, undertaken by some of the toughest farmers whom I have met.

I note the hon. Gentleman's point about future negotiations, but we have already taken one significant step, which we announced not long ago, in replacing the hill farm allowance with the upland entry level scheme. The fact that that has been so widely welcomed reflects both a recognition of the Government's commitment to supporting hill farmers, and our hard work in listening to feedback about what would help them when we were drawing up the scheme.

Does not the CAP cost the taxpayers of the European Union far too much and benefit far too few people? Agriculture represents about 1.5 per cent. of the aggregate EU GDP and about 5 per cent. of people in the EU work in agriculture, but almost half the EU budget is consumed by it. That cannot be allowed to continue for much longer, can it?

As my hon. Friend and the House will know, it has been a long-standing aim of the UK Government to reform the CAP in order to address some of the difficulties to which he has drawn attention, and as I said, the health check was, on balance, a further step along the way—although there were some steps forward and also one or two steps back. In the end, the Government's objective is to support farmers for the public goods that the market will not reward them for, which is why we have argued long and hard for a shift of resources from pillar one to pillar two. Agri-environment schemes are extremely important; we celebrated their 21st anniversary last year, but the truth is that this is a long, hard slog, because different EU member states take a different view about the need for reform.

Farmers are often hampered in producing food by regulation associated with the common agricultural policy. Given that only one animal out of all those tested in England and Wales last year under the fallen stock scheme proved positive for BSE, is it not now time to review the ban of on-farm burial and lighten the burdensome and costly regulation that farmers have to endure?

I take the hon. Gentleman's more general point about the cost of regulation, which is why we have been vigorous in, for example, trying to get the best deal we can on electronic identification of sheep. We have made some progress, but as he will be aware, not enough member states are worried about the matter to change the nature of the regulation itself. On his specific point, what is most important is that we act on the basis of the veterinary advice that we have about risk. I undertake to come back to him with a further response to the matter he has raised, but managing the risk and making sure there is no risk to the public has to be the overriding consideration in dealing with BSE.

Did not the Secretary of State put his finger on it when he said that reform is opposed by a large number of other countries? There is broad consensus across the House and, I think, the nation on the need for CAP reform in this country, but we have to persuade Dublin and France and Madrid to think differently. To that end, will the Secretary of State bring in some of the Church charities that campaign on opening up trade for the third world, and ask them to talk to the Churches and equivalent charities in Ireland, France, Spain about fighting for a real alteration, because there is no use in our agreeing to this in Britain if we cannot persuade our partners elsewhere in Europe?

My right hon. Friend, who has great experience in these matters, of course, is absolutely right: in the end, we have to get agreement across Europe to make the change. The agricultural policies that are pursued in Europe do have an impact on some of the poorest farmers in the developing world. That is relevant to the question of food security, because an urgent task that we face is to support a growth in agricultural production, particularly in the developing world, to feed a rising population, and that is harder for a farmer to do if they do not have a market and cannot see an incentive. I welcome my right hon. Friend's suggestion that we should encourage this debate, looking at all aspects of the importance of agricultural production and at making sure Europe has the right policy, but in the end we have to get consensus.

I am pleased to hear the Secretary of State endorse the point about reducing the burden of regulation, and he will know of his own Department's target to reduce the burden by 25 per cent. by next year, but is he aware of the research by Open Europe showing that, far from reducing, the burden is actually increasing dramatically? It estimates that the cost of the regulations that derive from the EU but are interpreted and implemented here is now £1.2 billion, an increase of a massive 47 per cent., and even more seriously, that home-grown regulation—regulation that originates in this country, and largely in his Department—has increased by 275 per cent. since DEFRA was established in 2001. Therefore, rather than waiting for any review of the CAP, when is the Secretary of State going to get a grip on what his own Department is doing and start to lift the burden on our farmers?

If the hon. Gentleman would like to draw attention to the specifics of the home-grown regulation to which he is opposed, it would be interesting to hear what he does not want us to do. As he knows, the vast bulk of the regulation comes from Europe and the nitrates directive, for example, was agreed not by a Labour Government but by his party in 1991, so it would have to answer for the form that that took. We worked very hard last year to implement the changes that were required under that legislation in such a way as to minimise the impact on farmers.

I have already indicated what our position is in relation to electronic identification for sheep. As the hon. Gentleman will know, we have been fighting the pesticides regulation because we do not think that the case has been made, particularly given that there has been no proper impact assessment in Europe. A message that could be sent from both sides of the House to Europe—both in current circumstances, when times are tough, and more generally—is that we should do the things we need to do to deal with problems, but we should not add to farmers' responsibilities if it is not strictly necessary.