HC Deb 06 June 1939 vol 348 cc357-71
Sir R. Dorman-Smith

I beg to move, in page 7, line 36, to leave out "flaked or rolled wheat mixture."

This is the first of a series of Amendments to meet a difficulty which arose during proceedings in the Standing Committee, and with permission I suggest that we should discuss the whole of these Amendments together as the others are consequential upon the first.

Mr. T. Williams

We on these benches would agree to that proposal. One comprehensive Debate would satisfy us.

Mr. Deputy-Speaker

So far as I am concerned I am in the hands of the House.

Lieut.-Colonel Sir Thomas Moore

Is not the real principle at issue raised in the Amendment which proposes to leave out "one half" and to substitute "three-quarters"?

Mr. T. Williams

I think the hon. Member has put his finger on the vital Amendment, but the Amendments preceding it have a bearing on it, and with one discussion we could cover the whole ground.

12.16 a.m.

Sir R. Dorman-Smith

Even though it is late I am sure the House will forgive me if I go into this matter in some de- tail, because it is one of real importance to a great many people. The purpose of Clause 7 is to exempt certain categories of flour from quota payments. It takes the place of the proviso in Sub-section (1) of Clause 3 of the Act of 1932 under which wheat meal, either alone or mixed with other substances, was exempt from quota payments if the miller could satisfy the Wheat Commission that it was intended for animal or poultry food. That exemption was granted partly as an administrative convenience and partly in pursuance of the Government's intention that the feeding interests should not be directly handicapped by the Act. Since that Act came into operation there has been a great increase in the output of this quota-free meal, especially when wheat is cheap, and the Wheat Commission have made representations to me that the exemption of wheat meal does, in fact, operate unfairly against the millers and the importers of low grade flour. They also represented to me that there was a danger that the quota-free meal which is nominally sold for feeding to livestock might be diverted from its proper use and sold for the making of bread. It was, therefore, unanimously recommended by the Wheat Commission, and I think the House will agree with the principle, that while wheat meal for animal or poultry feeding should continue to be free from quota payments that freedom should be conditional upon a measure of admixture which is calculated to meet two points of criticism.

The Bill as presented to Parliament provided in general that milled wheat substances manufactured from flour produced in the United Kingdom which were destined for livestock should be free from quota payment liability provided that the wheaten content did not exceed 50 per cent. of the whole. There were three exceptions to that general rule of dilution. In order to avoid interfering with the existing practice of feeders of livestock or poultry it was provided that flaked or rolled wheat needed to be diluted with only one-third of its weight of non-wheaten substances and cut wheat and multure meal did not need to be diluted at all. In spite of the fact that the proposals in the Bill were in some respects more advantageous to the poultry and the stock feeding interests than those in the Act of 1932 it became quite clear during the Committee stage that a feeling did exist that a requirement of so high a proportion as 50 per cent. dilution for wheat meal might interfere with the feeding practices of some farmers and poultry keepers, and might also operate to the detriment of small country millers.

It was this latter feeling that led Members of all the three parties in the Committee to support an Amendment which was made to Sub-section (5). They supported that Amendment against the advice which I, as Minister in charge of the Bill, felt bound to give them, but I would stress the fact that Members of all three parties did in fact support that Amendment. The Amendment had the effect of extending the definition in the Subsection far beyond the multure custom of Northern Ireland, for which it was intended. I said, and I still maintain, that there is a good deal of doubt whether the 50 per cent. dilution required would have the injurious effect upon stock-feeders and small millers which was expected by some hon. Members.

Nevertheless, I am bound to take note of the wish of the Committee. The voting was 20 to 11 against the Government. I had three courses open to me. One was to disregard entirely the feelings of the Committee and put the original proposal back. Another was to accept the Amendment. The third was to produce another suggestion. I did not feel that I could entirely disregard what the Committee had said, nor did I feel that I could possibly agree to the amended Sub-section because I believe it goes much too far. There are three reasons for that. If the wheat be indeed the property of the farmer and not just wheat grown by him, it would be a simple matter for the farmer to buy wheat, arrange for the miller to grind it and deliver it in the form of wheatmeal. This might well lead to undesirable practices which are not current in the trade to-day, designed to secure the advantages of the amended Sub-section (5). That would mean in turn that any miller who could make direct sales with the farmer could escape altogether the dilution requirement laid down in Sub-sections (2) and (3). Consequently the Sub-section, as amended, will enable the farmers to obtain exemption from quota payments not only for wheatmeal but also for bakers' flour. I do not think that the Mover of the Amendment wanted that to happen.

There is another point. The Wheat Commission have advised me that the Sub-section in its amended form would be unworkable. Except in very small mills it would be impracticable to grind small parcels of wheat separately so as to preserve the identity of the product as the property of the farmer. The proof that the Commission would need in order to satisfy themselves that the conditions had been fulfilled would present a real difficulty. In face of that, the Commission estimate that the extra cost of the audit and the inspection, if the Amendment went through, to say nothing of the cost estimated to arise out of legal disputes, might well be £10,000 a year, which would, of course, have to be met by wheat growers out of their deficiency payments. That is a very considerable sum. In those circumstances I am satisfied that it would be wrong to leave Subsection (5) in its amended form.

I was, therefore, concerned to see that the modifications of the Clause were practical and met the views expressed in the Committee, and the Amendments I have put down are the result of that consideration. I propose in these Amendments that Sub-section (5) should revert to its original form to meet the special case for which it was intended, but there are two substantial modifications which are proposed to help the case of the small miller and farmer. First of all, it is proposed that the maximum wheaten content of wheat provender mixture should be increased to 75 per cent., that is to say that wheatmeal or low-grade flour will need now to be diluted with only one-third of its weight of non-wheaten matter in order to escape the quota payment. I admit that I would prefer that this Clause went back to its original form. I have proposed another Sub-section (7) to provide that quota payment should be made only on the weight of the wheaten content which is in excess of the limits laid down in the Bill. That will be of help to small fanners who might accidentally include a small amount more in the wheat mixtures from which they or the miller might desire to produce some form of wheat provender mixture, including wheatmeal, in the new proportion of 75 per cent. He might accidentally include 78 per cent. of wheatmeal. Under the Bill he would be liable to pay on the whole of the 78 per cent., because of the 3 per cent excess. The new Sub- section (7) will provide that quota payments shall be made only on that part of the wheaten content which is in excess of three times the weight of the non-wheaten content.

I have to make one point absolutely clear to the House, and it is that the representative organisations of flour millers in this country are not in agreement with the first of the two points which I have mentioned. They strongly maintain that the original requirement of 50 per cent. dilution for wheatmeal and for low-grade flour was not too much, first of all because it would not interfere with the existing feeding practice and secondly because 23 per cent. dilution would not be sufficient to prevent the possibility of the use of the quota-free substances for quota-liable purposes or to offset the effect of the ash-content scale upon the trade in high - grade wheat by - products. I thoroughly recognise the fears which the millers have in this matter, but Clause 10 can operate if it found that the dilution Sub-section which I am proposing would work out wrong and if it was found in fact that everybody was trying to get round the intention of the Clause. We should then use Clause 10 for the protection of the trade as such.

I am very conscious, and I am sure that the House is also, of the difficulty in which I have been placed. I very much regret that it is impossible for me to put before the House proposals which have the complete agreement of all parties. We have been greatly advantaged by the way in which the Wheat Commission has done its work with the co-operation of all concerned. I would infinitely regret if we lost the good will created by that work. But I have taken it to be my duty, in preparing the Amendments to Clause 7, to try to meet as far as possible the views expressed by hon. Members of all parties in that Standing Committee, while preserving a system which does avoid serious risks of abuse and is capable of easy and fair administration.

12.31 a.m.

Mr. T. Williams

I fully recognise the extreme difficulty of the right hon. Gentleman the Minister of Agriculture, who apparently has been trying to reconcile all the views as expressed in one particular vote when the Wheat Bill was passing through the Committee stage. When the Amendment to which he re- ferred was moved and carried against the Government, certain Members from all parties voted against the Government. It is, of course, a great pleasure for all of us on this side to vote against the Government, and if there were two or three hon. Members who on that occasion, without understanding the depth of what they were doing, made one simple Parliamentary mistake I am not sure that I could not forgive them for having made that mistake in opposing this Government.

But I observe that neither of the hon. Members who, sitting on the benches opposite, moved and seconded the Amendment, is in his place to-night. The right hon. Gentleman the Minister of Agriculture may feel content to this extent, that the one Member looking after the Bill from the Labour party's point of view, when that Amendment was before the Committee, did not vote in favour of the Amendment, and to that extent the official position of the Official Opposition was that we were not in favour of the Amendment. The right hon. Gentleman must have satisfied the Committee that he was very unhappy with the series of Amendments on the Order Paper. He recognises that they conflict with the feelings of the Wheat Commissioners and with those of the millers, without whose good will this Wheat Act could not have been carried on so smoothly during the past seven or eight years. To move the Amendments in face of those facts is extremely delicate and difficult, and I imagine that the House would not feel like readily accepting the Amendments on the Order Paper. Indeed, I am going to give reasons so substantial that the right hon. Gentleman the Minister may feel disposed not to press the Amendments upon the House.

We on this side agree with the Minister as to the desirability of restoring the three Sub-sections deleted in Committee, for we recognise that the abuses that have taken place have been extremely difficult to trace, and, should the Bill remain in its amended form, abuse of all kinds would take place and no Wheat Commission could keep up with them. There would be more getting deficiency payments or escaping their responsibilities and liabilities, and to the extent that the purchaser of bread would have to pay higher prices. I am sure it is the Minister's desire not only not to create opportunities for abuse but to close the door to abuse as and when he can. Therefore, I can guarantee that my hon. Friends will support the three paragraphs in the last but two Amendments.

But now I come to the Amendment which appears to be some kind of a compromise—in Clause 7, page 8, line 1, to leave out "one-half" and to insert "three-quarters." That is to repeat an Amendment moved in Committee by an hon. and learned Member who is not now in his place. In a very useful Debate, the right hon. Gentleman the Minister of Pensions, speaking for the Government, put up such an unanswerable case, that the Amendment was negatived without even a Division. Now for the Minister of Agriculture to move the Amendment that the Minister of Pensions opposed in three columns of the Official Report seems an extraordinary state of affairs. I almost feel that I ought to quote every word in the speech of the Minister of Pensions. Certainly, for reasons that should be known to the Committee, I feel bound to make use of his arguments against the Amendment that is now on the Order Paper in the name of the Minister of Agriculture and that he fears this House might accept.

The Minister of Pensions said—and all his arguments were equally good: The object is to prevent low grade flour and wheat meal which can be diverted to human consumption escaping liability to quota payment as destined for livestock unless they are diluted. I am sure the Minister of Agriculture desires to avoid that kind of thing. The Minister of Pensions went on: If the need for adulteration is admitted"— (and I am sure every agricultural representative in the House does agree with the need for dilution)— then the nearer you get to 100 per cent. wheat meal or flour, the more chance of evasion there will be, and the greater the possibility of disposing of it for human consumption. He proceeded to say that this figure of 50 per cent. was arrived at after very long discussion with all the interests, the flour millers, corn merchants, pro-vender merchants and so on. What arguments could be advanced in the face of that logic? The Committee saw the logic of the argument of the Minister of Pen- sions. Now we are called upon to accept the Amendment which the Minister of Pensions argued against so effectively. I merely want to suggest that if these Amendments are admitted—including the one under which the quantities of wheat can be increased from one-half to three-quarters—it will not help the farmers, for as the right hon. Gentleman the Minister of Pensions himself said in that same notable speech, referring to the quantity of wheat in these mixtures fed to poultry and the rest, the proportion is far more likely to be 25 per cent. or 30 per cent. than the 75 per cent. sought by those who then moved this Amendment. Therefore, said the Minister,50 per cent. would not adversely affect the farmer. It is the sort of thing which the farmers allow for by way of elasticity between 25 per cent. and 50 per cent. That was his argument in regard to the proportion. He ended by saying: It definitely safeguards the Wheat Commission from abuse. I hope for that reason that the hon. Member will not press his Amendment."'—[OFFICIAL REPORT (Standing Committee D), 2nd May, 1939, col. 94.] I do not want to go into the highways and by-ways of the abuses which have so far been discovered. They are well known by the Wheat Commission and have been brought to the notice of the Ministry of Agriculture from time to time. I am quite sure that the Ministry recognises not only the right proportion of these mixtures, whether fed to poultry or cattle, but also recognises the danger of allowing those who would escape from their liabilities to do so and thereby defeat the legitimate efforts of the Wheat Commission to administer the thing correctly. At this late hour I have many sheaves of arguments I could advance against this series of Amendments, but the arguments of the Minister of Pensions were so effective that I will rely exclusively on the Minister of Pensions against the Minister of Agriculture.

I hope that hon. Members in this House who have the desire to see this Wheat Act continue working smoothly and who want to retain the good will of the millers, who have really been running the Act, and the Wheat Commission who are responsible for its general administration, will see the wisdom of not allowing this apparent concession to a small vested interest who are merely limpets hanging on to the industry of agriculture and not rendering any very real service to it. I hope the House will sec that the arguments of the Minister of Pensions were effective and unanswerable and that the Minister of Agriculture will, even at this late hour, see the wisdom of restoring the Bill to its original wording and allowing the Wheat Act to continue on its way rejoicing.

12.42 a.m.

Colonel Sir Edward Ruggles-Brise

I feel sure that the whole House will have noticed the extreme frankness with which the Minister of Agriculture laid the whole of the circumstances regarding this Clause before the House. Equally the House will recognise the complete frankness of the hon. Member who has just sat down in regard to the part which his party played in the Standing Committee upstairs. It was not only the Members of the party above the Gangway who undoubtedly cast votes on that particular occasion against the Government under a misapprehension; there were Members of other parties as well, and I think it is true to say that all were acting almost under a complete misconception as to the real issue which was before the Committee at that moment.

In view of these considerations I would like to join, not precisely in the theme which has just fallen from the hon. Member representing the benches above the Gangway, but in suggesting that the Minister of Agriculture might think it well not to press this series of Amendments at this stage, but should take an opportunity of further consultation, in particular with the Wheat Commission, and that it might be possible in that way to find a really satisfactory solution to a very difficult problem, so that the whole matter could be adjusted in another place. I believe that that might be the best course for the House to take at this moment and I commend it to the Minister for consideration.

12.44 a.m.

Mr. Price

As one of those who formed part of the holy alliance of rebels which defeated the Government in Committee upstairs and who are now accused of having brought about an unholy mess, I feel I am entitled to say something about it. I, at least, am one of the few rebels who happen to be here this evening to give an account to the House, although I see present the hon. Member for Evesham (Mr. De la Bère), who was also one of the rebels. I am not here in sackcloth and ashes because I still consider I was perfectly justified in taking the action I did in Committee. Let me, however, point out that I did not support the dilution of 75 per cent., and for the reason that I did not happen to be there. If 1 had been there I would certainly not have supported the rebels in that proposal. What I did was to support the claim of the small farmers, the poultry farmers and so on, which I thought only reasonable as put forward by the hon. and gallant Member for Maldon (Sir E. Ruggles-Brise) and another hon. Member, who argued that there was a strong case for these feeders of livestock having the opportunity of getting quota-free wheat which they could buy on the open market or produce themselves, thus using their own wheat and getting it milled at the local millers quota free. Poultry feeders could get it ground locally and feed it to their livestock.

I thought, and I still think, there was a case for that, because there is too big a tendency for small producers of livestock and small feeders to buy ready-made feeding stuffs. There is much to be said for their case because many of the best feeders take the view that they can, by doing their own mixing and using their own wheat and getting it ground locally and mixed in the right proportions, make up just as good feeding meals as those bought ready-made, and also just as cheaply. It is, of course, quite true that the door may be left open here for abuse. I am quite prepared to recognise that, but I thought it was perfectly legitimate to put forward this case in the Committee upstairs, so that the matter could then be reconsidered, and if, in the meantime, it was found that it would be unworkable, we could reconsider the whole thing on the Report stage. I have nothing to regret in that. I think it was perfectly in order and perfectly right that this matter should be discussed in this House.

I do not now under any circumstances at all agree that the Minister should go back on his own arguments and alter his view about this dilution Clause. To my mind it would certainly open the door to more abuse than anything else. He probably has very good reasons, but I regret that it should not be possible for the Minister to accept the right of the small poultry feeder to buy wheat on the open market and get it milled by local millers. As I read the proposal in this Amendment, it has to be wheat of his own production. I am prepared to accept the point that to do what was suggested in Committee would leave the door open to abuse and that therefore it must be wheat produced on the farm itself and not wheat which is bought in the open market. I hope, therefore, that the point made by the hon. and gallant Member for Maldon will be considered by the Minister. I think there is a strong case for postponing the whole thing still further and allowing another place to see whether they cannot thrash it out after still further negotiations with the parties concerned, and bring about a final solution which we can all accept.

12.50 a.m.

Mr. De la Bère

I shall not detain the House unless I am interrupted. I wish to say a few words on the Wheat Commission. The Minister of Agriculture and hon. Members on the opposite side have alluded to the Wheat Commission, and I want to say that I hope that the House will not be guided entirely by what the Wheat Commission want. I am not going to cast any aspersions or make any innuendoes, but it is possible that the Wheat Commission may have been influenced by the big milling combines. The big milling combines have got a definite line to take in these matters and that line may be entirely opposite to the interests—in many cases I am afraid it is so—of the small man. It was the small man whom the Committee upstairs were seeking to uphold when they defeated the Government. The small man is entitled to be upheld. The hon. Member for Don Valley (Mr. T. Williams) talked about some small men or some small vested interests—I am not quite clear which—but it is the small man, the little man, that as hon. Member for Evesham I am out to uphold. I have stayed here for over 10 hours in my endeavour to uphold this small man. I say that if it is not done to-night the thing will be allowed to go by default and the small man will be once again thrown to the wolves and the large combines will be allowed to carry on exactly as they have done in the past. There are times when restraint is not a very great virtue. I believe that if the Wheat Commission have their way they will play the racket of the milling combines, which no right-minded person would wish to see continued.

12.52 a.m.

Lieut.-Colonel Heneage

I was one of those who opposed the Government on this matter in Committee upstairs. I was determined to listen to the arguments before I made up my mind as to the right attitude to take up, as I represent one of the largest grain-growing constituencies in the country. What we have to be certain of is that the Bill is so drafted that evasions are practically impossible. I must say I was very much impressed by the arguments put forward. As has been stated, what we wanted to do upstairs was to protect the small farmer and the grist miller. I am afraid that has not been done by these Amendments. I would ask the Minister, does he think that the grist miller is a very important man? The hon. Member for Don Valley (Mr. T. Williams) does not think so, because he talked of him as being a limpet. I think he said he was a drag on the wheels of other business. I notice beside him the right hon. Member for Hills-borough (Mr. A. V. Alexander) and I hope the right hon. Gentleman has not been prompting him, because I understand that the Co-operatives are very large millers in their own way.

Mr. Alexander

And very good millers.

Lieut.-Colonel Heneage

I thought I should get the right hon. Gentleman to speak because he has been behind the change of front in the Opposition.

Mr. T. Williams

The hon. and gallant Member must have misunderstood me. I made no reflection upon the small farmers. Rather, if I did reflect at all, it was upon a new organisation which has come into existence more or less since the commencement of the Wheat Act in 1932, the National Association of Agricultural Merchants. I said that they were rather like limpets, and, apparently unlike all the other interests, they are the one exception.

Lieut.-Colonel Heneage

All this gives very little protection to the small farmer. That is what we object to. We are faced with the difficulty that our Amendment widens the door apparently too much to some form of evasion, and the Minister's very honest attempts are not satisfactory. I think the suggestion of the hon. Gentleman beside me is the only one, and that the matter should be withdrawn. I am very sorry. I am not satisfied, I still feel that justice has not been done, and I hope very much that it will be possible in another place, with consultations not only with the large millers but with the small farmer, to get Amendments which will meet the case.

12.56 a.m.

Mr. J. Morgan

I agree with the point of view of the hon. Member for Evesham (Mr. De la Bère). I do feel that the net effect of this Bill—I say this in the presence of the right hon. Member for Hills-borough (Mr. Alexander)—will be to play into the hands of the big firms. The wheat industry of this country has gone its way. Despite attempts of this association to get brokerage on the transactions involved, the big firms are being encouraged. From the point of view of the agriculturist I do not want any illusions to exist as to the effect of this Bill. I am not saying that the co-operative movement millers are necessarily wrong in utilising this kind of machinery, but for hon. Members on the other side to get away with the idea that in supporting this Bill they are really supporting the agricultural interests is wrong. They are supporting the interests of the big business interests of this country, whether that is good or bad. Having given them the grain trade, you are now about to give them the provender trade and the feeding-stuffs generally. That may be good or bad, but it is the fact. This Bill has that main defect.

Another characteristic of this Bill is that it has grown up to deal with the possibilities of fraud. This scheme generally is so liable to fraudulent evasions that you have to bring in a main Bill, the only substantial Clause being Clause 1 and the rest being provisions to stop people doing the wrong thing. Therefore this is not good legislation from the agricultural point of view, and nobody can go down to the country and congratulate himself on this Measure. It is a Bill that will have the main effect of supporting the big business interests of this country, and that is the attitude adopted generally by the other side. From the agricultural point of view it is a bad Bill.

12.58 a.m.

Sir T. Moore

I want to associate myself with the remarks made by the hon. and gallant Member for Maldon (Sir E. Ruggles-Brise) and the hon. Member for Doncaster (Mr. J. Morgan). I think that the whole House must have a great deal of sympathy with my right hon. Friend in the very difficult position he has been put in, and I do hope he will see his way not to press this series of Amendments. He is departing from an agreed and established principle on the fifty-fifty basis, and thereafter he is trying to safeguard the position which he is now creating by a lot of elaborate and cumbersome Amendments. I ask that he should read for himself Clause 7, which it would need a mathematical genius to understand. I cannot imagine any poor farmer or miller having the mental capacity to see what it means. I will only add that I have been approached by one of those small men to whom reference has been made to-night. He has asked me to put forward the view of the small man and to try to persuade Members and the Minister that if the principle was right in Committee that it cannot be wrong now. Therefore I ask the Minister to consult again with the Wheat Commission, the National Farmers' Unions of England and Scotland and with the Millers' Association.

Mr. Acland

I hope the Minister will withdraw this Amendment. I wonder whether the House realises how lucky the Government are that at the other end of the passage there is another place which can clear up matters for them.

1.3 a.m.

Sir R. Dorman-Smith

When I first brought in this Bill on Second Reading I said that I thought it would give some people headaches, and the House will have recognised my difficulties in producing this Amendment. The hon. Member for Don Valley (Mr. T. Williams) has really quite reconvinced me by his reference to the speech of the Minister of Pensions, but unfortunately the Committee at that time did not see the logic of that particular speech and the result was that the door of evasion was opened wider than it was in the first place. If the hon. Member for Don Valley quotes the speech of the Minister of Pensions against me I might quote one or two passages out of his speech which might not go down with the right hon. Member for Hillsborough (Mr. Alexander). I myself am not at all convinced by the argument of those who say that the Bill, with the Amendment, will help the little man. I believe that he is assured more if this scheme should work smoothly and properly, and, I again repeat, the value I place on smooth working which we have got by the good will of all concerned. I am therefore inclined to accept the suggestion made by my hon. and gallant Friend the Member for Maldon (Sir E. Ruggles-Brise) that the matter be considered in another place. I think it would be better to allow the Wheat Commission to consider the matter again, and to see whether we cannot get agreement; and then we can consider anything which they may do in another place.

1.6 a.m.

Mr. Alexander

I think what the Minister has just said will meet with general acceptance. I may say that the millers themselves never asked for the original subsidy Act but they have loyally administered the scheme for seven years with very great success for the fanners, and from the point of view of the millers the number of working millers registered under the scheme has increased, and so far from putting millers out of business it has had the opposite effect.

Amendment, by leave, withdrawn.

Amendments made: In page 7, line 41, leave out "that satisfies the following condition," and insert:

"as to which the following condition is fulfilled."

In page 8, line 23, leave out "that satisfies the following conditions," and insert:

"as to which the following conditions are fulfilled."

In line 40, leave out "satisfied," and insert "fulfilled."

In line 42, leave out paragraphs (a) and (b), and insert:

  1. (a) that the destination of the substance was for livestock of a person by whom the whole of the wheat from which the wheaten content of the substance is derived was grown;
  2. (b)that no deficiency payments have or will become payable in respect of that wheat; and
  3. (c)that the substance is not as to any part of its wheaten content derived from a milling the abject of which was a separation between husk and kernel, that is to say, between parts of wheat having different ash contents."—(Sir R. Dorman-Smith.)