HC Deb 09 February 1939 vol 343 cc1223-32

7.26 p.m.

The Parliamentary Secretary to the Board of Trade (Mr. Cross)

I beg to move, That the Sheep, Mutton and Lamb (Import Regulation) Order, 1939, dated the 4th day of January, 1939, made by the Board of Trade under the Livestock Industry Act, 1937, a copy of which was presented to this House on the 31st day of January, 1939, be approved. This Order carries out a decision of the Government, announced by the Minister of Agriculture on 20th December last, to make all imports of live sheep and of mutton and lamb subject to licence. The Order covers imports of sheep and lambs and of mutton and lamb, other than mutton or lamb offals separate from the carcase or mutton or lamb in airtight containers. It applies to imports from all sources. It continues the quantitative regulation of imports from foreign countries, and enables effect to be given to the recommendations of the Empire Meat Council in regard to supplies of sheep, mutton and lamb to the United Kingdom which come from Empire countries. Further, the Order enables quantitative regulation to be applied to these supplies in the event of the Empire Meat Council failing to reach agreement. The Board of Trade have issued general licences under this Order to firms importing mutton and lamb in replacement of those which they have held in pursuance of the Ottawa Agreements Order. These licences are issued subject to compliance with the foreign quotas.

I have to inform the House that the Empire Meat Council, after a number of meetings, the last of which was held yesterday, have failed to come to a unanimous conclusion as to the imports of mutton and lamb for the current year. The situation which has arisen in consequence is being considered by the Government, and I hope it will be possible to make a statement at an early date. The House will appreciate that I cannot add anything further to-night. The Government's consideration will be pressed forward as rapidly as possible, and in the meantime the Order is in force, so that any quotas which may be decided upon can, if necessary, be enforced. I may say finally that I have reason to believe that we may look to the Governments of Australia and New Zealand to co-operate with us in ensuring that any quotas that may be decided upon shall not be exceeded.

7.29 p.m.

Mr. T. Williams

In view of the statement which the hon. Gentleman has made, might I ask whether, since the council have failed to reach any decision, this Order could not be withdrawn until a Government statement can be made? We know, of course, that part and parcel of the Order is a reservation of power to the Government, in case of a breakdown of negotiations, to determine what the future imports of sheep, mutton and lamb shall be, and, seeing that the recent deliberations have broken down and no agreement has been reached, would it not be within the power of the hon. Gentleman to withdraw this Order until a statement can be made by the Government? For my part, I do not see any great necessity for forcing the Order through the House, since it is now in fact in operation. The Government will have to determine for a period what the imports of sheep, mutton and lamb shall be. What point, therefore, is there in forcing the Order through at this moment?

As I understand it, the Order makes no fundamental difference in the situation, except that, while in the past it has been the duty of the Government to negotiate with Empire countries regarding the imports of sheep, mutton and lamb over a certain period, under the terms of the Order it will be left to the producers of the various Empire countries to meet together and decide what quantities they think ought to be imported, and to make recommendations to the Government, who will be expected to accept those recommendations. If I am wrong, perhaps the hon. Gentleman will correct me. If that is the correct interpretation, then, despite the fact that the Minister of Agriculture took a very prominent part in the discussions at Sydney, I am not sure that this is not a retrograde step. I can quite understand a body of producers meeting together for the purpose of determining how not to destroy their own market, but to allow a body of producers to determine what quantities of any foodstuffs we shall import is not only making a leap in the dark, but one in the wrong direction.

The only other thing I should like to ask is this: Are the licences issued under the terms of this Order identical with those issued in the past, when so-called voluntary agreements had been entered into for imports of sheep, mutton and lamb for certain periods? Have the Government considered the possibility that when they enter into such arrangements with Empire countries for periods of three months, six months, or 12 months, as the case may be, the licences ought not to be issued to individuals but to the Governments, or, to put it another way, are the licences issued to importers transferable in any set of circumstances?

7.32 p.m.

Mr. W. Roberts

I am disappointed that we were not given a little more information about this proposed scheme. It is a new development with which the Minister of Agriculture has not been very much associated, yet we have had no explanation as to how the new scheme was to be worked. All we have been told to-day is that the negotiations have broken down through the inability of the Empire Meat Council to come to a unanimous decision. I feel that the House is entitled to be informed a little as to what the proposals are. The Empire Meat Council, I thought—I may be wrong—was representative of Governments, and not of the producers organisations themselves. If that is so, it raises the question, which has been already put, as to whether these licences are to be granted by the Council to individual importers or to the Governments of the countries concerned. There is another question. What is the total amount of mutton and lamb which is going to be allowed into this country? That has surely to be decided before the allocation of the total quantity of import is arrived at. We have had no information as to what that total quantity is to be. According to this Order, the Board of Trade are authorised to delegate authority to this Council; but we should be told what directions the Board of Trade are going to give, what indication the Government are going to give to the Council as to the quantity of imports of mutton and lamb that is to come into this country.

I am not hopeful that this type of control will raise the price of mutton to the English farmer as much as some people seem to expect. My information is that New Zealand produce has maintained its price very well in the last year. I do not think that New Zealand lamb has come into this country in the last year in increased quantities—Australian lamb has. I understand that the price of New Zealand lamb has actually gone up in the wholesale markets in London during the past year. I would like to know whether, in those circumstances, any kind of calculation has been made as to what reduction of imports is intended, and what estimate has been made as to the effect of such a reduction on English mutton and lamb prices.

I believe that the decreased price for English mutton and lamb during the last 18 months is due to the increased production, which has created a glut on the market. The decrease in the price has not been translated to an equal fall in the retail price to the consumer, and that bad marketing has affected the demand for English mutton and lamb. We have been considering a problem which is in some ways similar to this. A mere reduction of bacon imports without a bacon marketing scheme would not have solved the problem for the English pig producer Similarly, by a mere reduction of imports of mutton and lamb we shall not solve the British sheep producer's problem. There is one other small question that I would like to ask. I notice that tinned mutton and lamb and offals separated from the carcass are not to be covered by this proposal. It happens that the imports of these have gone up consider ably during the past year. Imports of tinned mutton and lamb have gone up by 107,000 cwts., and of offals by 6,000 cwts. That is a total increase of over 160,000 cwts., which is about one-third of the total increase in the imports during the year. How does this proposal deal with that, and for what reasons are these products excluded from the procedure laid down? The main point upon which we should like more information is as to what directions are to be given to the Empire Meat Council as to how licences are to be issued, and to whom are the licences to be granted when any decisions are arrived at?

7.40 p.m.

Mr. J. Morgan

I feel that this is one of the most dangerous proposals for the purpose of aiding agriculture that have been brought forward in this House for a long time. I say that sincerely. I cannot imagine the Board of Trade having, in fact, sponsored this except under pressure from the agricultural interests of the country. I do not want to be misunderstood; I am not getting up merely to carp and find difficulties. Take the position as it has been in regard to mutton and lamb in the last year. The assumption in the minds of farmers is that if you deal with imports you can in some automatic way improve the position of the home producer, who has passed through a very difficult time. There was an increase in the quantity of mutton brought into the country last year, but it kept its own price level throughout the year; in fact, there was a slight rise in the price of imported mutton at a time when mutton prices in this country were falling rapidly. The story of lamb is even more interesting, as was indicated by the hon. Member for North Cumberland (Mr. W. Roberts). The quantity of imported lamb declined by about 18,00o cwts., but it realised something like£260,000 more. It actually increased its price in the face of a falling demand for English lamb.

What will happen if we begin to regulate imports of mutton and lamb? It is happening now with beef, and it is going to happen in regard to mutton and lamb. At the moment a certain reputation has been earned by the English, Scottish and Welsh farmers for certain kinds of lamb and mutton in their own market. If we regulate the imported article the importers—or the exporters in the countries concerned—will leave behind that kind of mutton and lamb which is of a lower quality, and will tend to bring into this country the high quality meats. That will take from the home farmer his high quality trade. To the extent that this happens—assuming that the farmer does nothing else to improve his own position—this tendency over the last year will show itself, and the imported article will tend to improve its price level while the home-produced article will tend to worsen in price.

What is the problem of the home producer? He has in this last year produced a surplus, and for various reasons has been unable to market that surplus. He had a drought at the beginning of the year, he was forced on to the market in the summer with a very difficult season, and he could not hope to hold his price against the imported article under those conditions. Some machinery should be provided, not for the exporter from the Dominions to regulate supplies, but for the home farmer to regulate supplies. It was the surplus production of the home producer that created the problem, and one should apply remedies to the person and the area in respect of which the problem was created.

Take another danger that lurks in this simple proposal. One knows the kind of people who deal in mutton and lamb in this country. They are among the most astute business men in the country. They have their interests consolidated; they can direct their interests in a given set of circumstances, so that they have, and will increasingly have under these powers, control over operations, against a diffused number of farmers all trying to find a market through various channels. What will they do to get over the difficulty of having to import under the quota basis? They may come to the President of the Board of Trade before long and suggest, as the curers have just done in the Bill we have been considering, that the whole thing be done by weight and not by carcase. You will find that all the best cuts are brought into the country and that all the worst cuts are left out of the country, and they will again be capturing the quality trade that is available in this country from the farmer.

What is the suggestion which must be brought at this time into a discussion on this issue? What is the argument which has probably to be put before the people who have to assent to this policy for it to go through in the way that the Government would like? The inducement is being held out to them that if they can send less here for the same amount of money, why worry? They must at least be given a guarantee that they will get the same amount of money. The President of the Board of Trade is aware of the fact that they must be assured of at least the same income. Therefore they are being pressed to accept a proposal that will guarantee them as much money but for a less product. Where do the consuming interests come in, and why force them to give satisfaction to Denmark in this way? Is the consumer getting any satisfaction? There are in this country thousands of families who are unable to get bacon. They cannot get bacon although the same volume of money is being paid for bacon from overseas. We have driven bacon off the tables of thousands of homes by the system to which we have been committed in this way.

I suggest that, before the Minister of Agriculture commits himself too closely to this idea of regulating products which are, in fact, maintaining price levels, he should not disturb the factors which actually keep the bottom to the market. In the last year it was the imported mutton and lamb that held the market for the British producer here at home. If it had been left to the British producer, bad as it was, he would have been worse off probably without it. What is the characteristic of the imported mutton and lamb? As far as New Zealand and Australia are concerned, it comes from two breeds of sheep alone, cross-breeds. You can go the whole length of New Zealand, as I have had the pleasure of doing, and also to Australia, and find only two breeds of sheep. In this country there are some 21 breeds of sheep, and a dozen types of sheep turn up in a single market and the butcher is incapable o f doing a certain kind of trade or even of competing at all for some types of lamb and mutton available in the market. It is not his class of trade. There is no standardisation about the supply of mutton and lamb in this country. It is the overwhelming characteristic of the exporting countries that they fix their standards so that they fit into the requirements of the trade in such a way as to get them their market.

I would rather hope, as my hon. Friend suggested, that this Order would be withdrawn for the time being, but I am also not disposed to oppose the Order. I should like to be satisfied particularly that it was not to be left as it is, but that the farmer himself would take steps to face up to a situation which he cannot remedy by merely trusting to the regulation of imports in this way. He is going to put a premium on the imported article and at the same time he is taking no real steps to help his market or to defend it or to remove his surplus. His problem is to remove his surplus, a rid some kind of machinery ought to be erected to see that the surplus is disposed of in a satisfactory way. There are plenty of people who can do with it, and therefore he could improve his own position. I do not feel that he is trusting to this type of Measure to improve his posi- tion in regard to mutton and lamb; actually in the long run, he will only worsen it and give guarantees to his competitors.

7.51 p.m.

Lieut.-Colonel Heneage

I hope very much that the Government will not withdraw the Order as suggested by Members of the Opposition. The sheep industry, which has been very badly hit in the constituency which I have the honour to represent, will be glad to know that the Government have been taking this line. I realise that the Import Order is actually in operation, and it would have a very bad effect if, at the request of the Opposition, the Order were to be withdrawn. The arguments of the Opposition apparently tended to show that the stopping of imports, especially if they should come from New Zealand, from which there is an importation of high-class mutton and lamb, would not improve the lot of the British farmer. I do not at all agree. They also say that there are too many breeds of sheep. That may or may not be true, but it was not until the restriction of imports of bacon took place that it was possible to obtain a good breed of pig in this country. The breeds of pigs, so far as bacon is concerned, have improved out of all recognition, and I believe that that will also be true in regard to sheep. I congratulate the Government upon taking this step, and I hope that they will not be alarmed if they do not get a unanimous decision of the Empire Council, which, I think is almost impossible. In Lincolnshire we all depend upon the new Minister of Agriculture to play his part, and I hope that the President of the Board of Trade will also play his part. Therefore I certainly welcome this Import Order.

7.53 p.m.

Mr. Cross

The hon. Gentleman the Member for Don Valley (Mr. T. Williams) asked me whether my right hon. Friend had the power to withdraw this Order.. There is no power to withdraw the Order. As I understand the position, the Order remains in force for a limited number of days, and I think that the hon. Member realises very well that it then runs out unless in the meantime it has the sanction of the House. I am hoping that within a comparatively few days it will be possible to announce the decision of the Government in this matter. The Order will remain in being in the meantime to enable the Government to take whatever action they desire. The hon. Member put to me a number of questions on the subject of licences. The licences remain the same with this difference. There have to be new licences in so far as Dominion imports are concerned. As regards foreign countries licences are issued to importers, and so far as the Dominions are concerned licences are issued to the Customs permitting the imports from the Dominions on the understanding that at a later stage the latter would co-operate if necessary in the administration of quotas from the exporting end. It is purely a matter of administrative convenience, as I understand that on some occasions it proves to be better and more convenient to control the imports from the Dominions' end.

The hon. Gentleman the Member for North Cumberland (Mr. W. Roberts) asked me one or two questions concerning the total amount of mutton and lamb which it was proposed to import. He will appreciate that they are questions which I am not in a position to answer because the Government have not yet come to a decision on the matter. He also asked why tinned mutton and lamb are not included in the quota, and I am informed that the reason is that they are not found to compete with other forms of mutton and lamb, and consequently do not affect the stability of the market. Hon. Members have also raised questions as to the object of having any quota of imports at all. Our main object in imposing quotas would be to secure the stability of the market for mutton and Iamb in so far as imports affect the market. Imports are not the only factors affecting the market for mutton and lamb in this country. The price of wool and the price of by-products are certainly also very important factors. The object, therefore, of quantitative regulation of imports is to make a contribution to the stability of the market at home while at the same time bearing in mind the interests of consumers. I submit to the House that, in the event of a quota being imposed, the knowledge that imports are to be limited eliminates a certain possible source of lack of confidence.

Question put, and agreed to.

Resolved, That the Sheep, Mutton and Lamb (Import Regulation) Order, 1939, dated the 4th day of January, 1939, made by the Board of Trade under the Livestock Industry Act, 1937, a copy of which was presented to this House on the 31st day of January, 1939, be approved.