§ 4.7 p.m.
§ Mr. Frederick Willey (Sunderland, North)
I always like, whenever I can, to begin on a note of common agreement, and I am sure that the whole Committee will agree with me when I say that the House of Commons will be very much the poorer when my right hon. Friend the Member for Don Valley (Mr. T. Williams) leaves us, having announced his retirement from Parliament. [HON. MEMBERS: "Hear, hear."] I am sure that no one will take offence if I say that he has been a very great friend of the agricultural industry.
Of the Minister himself, I would say, once again, that I recognise the charm with which he endears himself to the 1087 House, but I would advise him to hold fast to this asset, because he is a very unlucky Minister, becoming increasingly in difficulties with different sections of the industry for which he is responsible. Last week, we discussed fishing, and I called his attention to the fact that everyone who took part in the debate criticised his Department. Today we are to discuss pigs and the bacon industry, and I anticipate that the same course will be followed.
We have to remember that pigs are found on two-thirds of all the holdings in this country, and that they are of particular importance to the small farmer. We have also to appreciate that they have a far wider importance than even to agriculture. Since 1951, the taxpayer, by way of subsidy, has price-supported this industry to the extent of £326 million; that is in addition to the tariffs on Danish bacon, running to £18 million or £19 million.
I say this not to criticise or disparage the industry, because it is agreed on both sides of the Committee that the present machinery for supporting this industry is the best that we have been able to devise. I have called the attention of the Committee to this, because we have to recognise that the nation has a considerable interest in this industry and has a considerable stake in its prosperity and efficiency.
We should ask ourselves who has had the benefit of this support. Certainly not the taxpayer as a shopper, because, even allowing for the fall in retail prices over the past couple of months—and it will be temporary—retail prices are now considerably higher than they were in 1951. It is difficult to see how the industry has benefited. We have previously debated the trend in farm incomes. So far as pigs are concerned, if we take the price indices which the Ministry provides, prices were less than in 1953. They have run down over the past year, and if we look at the position this year we find that there has been a very sharp rundown, which has been further depressed by the news of the Anglo-Danish Agreement. This affected pedigree pigs also, which is very depressing.
Has this support brought stability to the industry? It certainly has not. The fluctuations that beset the industry—the 1088 pig cycle—have been more aggravated since 1951 than they were pre-war. We had a production peak in 1954, but this was followed by the depression in 1955 which led the Government to institute the Bosanquet Commission. We had a peak last year, but it was followed by the position today, in which supplies of home-produced pigmeat are expected to decline catastrophically. Official estimates are that in the next twelve months there will be 1¼ million to 1½ million fewer pigs for slaughter in the United Kingdom.
We have argued all this for decades. It all undermines confidence in the industry and hampers efficiency and technical progress. The only difference between the position now and pre-war is that the fluctuations today are the result of deliberate Government policy, resulting from the incentives and disincentives of the Price Reviews. In fact, the right hon. Gentleman has shown a particular flair in this matter. We are to have this shortfall of pig meat overlapping the shortfall he has contrived in imported and home-produced beef supplies.
What has happened, and what will happen over the next twelve months, will be the result of Government policy. The Government declared, in the White Paper of 1958, thatThe trend of output must be reversed.It certainly has been reversed, but with this very real stake in the industry we must ask ourselves why. It is true that we have a higher level of production than we had pre-war but it is equally true that we have a higher level of consumption.
We are particularly concerned this afternoon with the bacon side of the industry. We obtained figures the other day showing that in 1958 home-produced supplies were 42 per cent. of the domestic market. That figure compares very favourably with the 32 per cent. before the war, but it has already run down sharply. What it does not do is to compare favourably with the 49 per cent. of the market which home-producers had in 1951. Probably our share of the home market has fallen by about 10 per cent. since 1951.
§ Sir Anthony Hurd (Newbury) indicated dissent.
§ Mr. Willey
I will concede to the Government—no doubt the hon. Member 1089 for Newbury (Sir A. Hurd) will agree with me about this—that they have succeeded in their objective of reversing the production trend. They have reduced production; in fact, they have done it Quite dramatically.
§ Mr. Willey
I have previously argued in this Committee and in the House, and am willing to do it again, that the remarkable thing was the length of time during which the present Government imposed rationing when the rest of the world was freed. It is certainly true of bacon. We were about the last country in the world to set bacon free. We are concerned with what the Government have done to reduce production and I was saying that they have succeeded remarkably well in that objective. We know that breeding in the sow population is falling drastically, and that there is a possibility that it may run down even to pre-war level. It is significant that, at the very same time, the corresponding figures in Denmark have increased 20 per cent. and are probably an all-time record. By means of this support, have we attained economic production? Certainly not. The present declared aim and objective of the right hon. Gentleman is to attain economic production.
However, the one bright feature of this rather gloomy record is the Pig Industry Development Authority. We wish all speed to its work, but we have to recognise that the Bosanquet Commission itself envisaged a 10-year development programme. This is essentially a long-term approach. We have to recognise, at the same time, that while we are concerned about the work which the Pig Authority is doing, we are also concerned about such things as capital investment. I am sick and tired of asking the right hon. Gentleman what he is doing about farm building research, and of getting the usual prevaricating replies.
§ On the question of disease, where the annual loss of livestock is running to £80 million, what sign have we of energetic action by the Government? The whole question of imported foodstuffs, which is a major production cost, is again one on which we cannot get any satisfactory reply. We want action. Without 1090 it, we cannot deal with the economics of the industry. More important than anything is that if we want technical progress the industry has to be able to plan ahead with more security. That is a disturbing fact which has resulted from Government policy over the past few years; the industry has not had that security.
§ That applies particularly to the bacon side of the industry. I shall not pursue my rather arid discussions with the right hon. Gentleman about whether bacon factories are now employed to 60 per cent. of their capacity or whether, as the bacon curers say, the figure is 40 per cent. We know that the percentage, whatever it may be, will in all probability be drastically reduced within the next twelve months. The cutter and manufacturing markets will be particularly strong and the bacon factories will be in serious difficulties. They have a very bleak outlook.
§ I would not argue for a moment that the bacon factories have a prescriptive right to be kept fully occupied, but the Government a few years ago, encouraged bacon factories to increase their capacity, and, in view of that fact, have a special responsibility. We have to recognise equally that if the bacon curers are to reduce costs they must have an adequate throughout. The right hon. Gentleman cannot even seek consolation by turning to pork. I have just received a letter from one of the leading manufacturers demanding a radical reappraisal of the Government's pig policy. The result of all this is that we have this anxiety and a disturbing prospect for the pig industry. That is a development for which the Government must accept responsibility, but the responsibility goes rather further. The Government are responsible not only for the way in which they have carried out their policy of incentives and disincentives, but for not having done anything at all about marketing.
§ I would remind the Committee that when, in the House, we discussed the Pig Industry Development Authority my right hon. Friend the Member for Don Valley had the wisdom and the foresight to say that something would have to be done about marketing if we were to achieve anything like stability. We know the policy of the Government 1091 —or absence of policy—because it was set out in the 1956 White Paper. I have complained before that I find it very difficult to follow the logic of Government reasoning. The Government say that the Reorganisation Commission rejected the case put forward by the producers. They say, further, that the producers disliked the proposals put forward by the Reorganisation Commission. Therefore, conclude the Government, we shall not do anything at all. What the Government failed to grasp, or for doctrinaire reasons failed to comprehend, is that the Bosanquet Commission, the producers and, in fact, almost everyone who gave evidence before the Commission, recognised that some steps had to be taken to provide more orderly marketing and a suitable throughput for the bacon factories.
§ I would not pretend for a moment that this is an easy problem. It is a very difficult one, the most difficult of all problems of agricultural marketing. We all know the difficulties of pigs going to three markets—bacon, manufacturing and pork—and we know that the pork market is affected by general meat prices, but because a thing is difficult that is no excuse for inaction. I have complained before of the present Minister calling in aid committees and advisers. Here we have the committees and advisers and admittedly, at the end of the day, there was a difficult problem to face, but all the right hon. Gentleman has done is to stick his head in the sand like an ostrich. The problem has still to be tackled.
The National Farmers' Union has taken an initiative. It has reviewed its proposal for an all-pig board under the marketing Acts. All that that evoked from the right hon. Gentleman was a tactless brush-off and the reaffirmation that his head is still in the sand. It is true that he retracted a little when I put a Question in the House. I should like to emphasise to the Committee the statesmanlike and reasonable way in which the N.F.U. acted. I would remind the Committee of what the Chairman of the N.F.U. Pigs Committee, Col. Wilson, said:
I think it would be a great mistake if we went forward with the promotion of such a board without the complete support and unanimity of the country as a whole.
§ Surely that was taking a very reasonable negotiating position. That ought to have evoked some response from the Government. Surely the Government ought to have realised that there are patently and obviously marketing difficulties, but the Government have done nothing and show no signs of doing anything.
§ It is equally true that any pig or livestock policy is conditioned by slaughterhouse policy. This is particularly true of pork. We know the importance of having more storage facilities available, but all we got was the renunciation of the previously declared policy of the Government in the Slaughterhouses Act. The Government made it a thousand times more difficult to deal with an already difficult marketing problem. In this situation, with the industry anxious and disturbed, and, at the same time, the Government showing no sign of taking any effective action, we got the announcement of the Anglo-Danish Agreement. I think that I can anticipate the right hon. Gentleman. He may call my attention to the fact that we opposed the 10 per cent. tariff on Danish bacon. We did, but I would remind him of the grounds on which we did so.
§ We said, in the first place, that it was wrongly timed. We felt that at the time when the Government had their jackets off, struggling against inflation, it was wrong to impose a tariff on foodstuffs. We also said—and this is particularly relevant in the present context—that this could not be a substitute for orderly marketing and we should get some undertaking from the Government first that they would tackle this essential problem. Finally, we said that they should not abandon our bulk purchase arrangements with Denmark. I think that everyone in the Government would accept that now. [HON. MEMBERS: "No."] If we had continued our bulk purchase contracts with Denmark we should have had an easy formula by which to negotiate with the Danes. We could have had a formula which would have provided all the safeguards that might have been required by producers.1093
§ Mr. Willey
I do not want to pursue this at great length. [HON. MEMBERS: "Oh."] This is a matter behind the whole of the Common Market negotiations about agriculture. It is generally agreed that in relation to the producer we can get much greater security both ways if we resort to bulk purchase agreements. What applies in relation to sugar in the West Indies and the sugar beet producers applies equally to the Danish and domestic bacon producers.
§ Mr. Gerald Nabarro (Kidderminster)
Is the hon. Member really suggesting that we should commit ourselves to long-term agreements with the Danes for the bulk purchase of bacon without the same sort of agreements with the Danes to commit themselves to the purchase of manufactured goods? Is that possible? He knows that it is impossible.
§ Mr. Willey
I would remind the hon. Member, as my right hon Friend reminded the House, that we had a £40 million adverse trade balance with the Danes. That is something which could be brought into account if we negotiated a bulk purchase agreement.
In the case of sugar, if we want to produce security both for the home producer and the importing producer, the best way to do so is by a long-term agreement. Once again, this should be clear enough. I am trying to carry the Committee with me as far as I can. The Anglo-Danish Agreement has been wrongly timed. The producers are complaining that they are being sold down the river, which I think is quite untrue, because they were well down the river before the Agreement was announced. This Agreement has not caused but aggravated the present depression in the industry. When the N.F.U. says that it has grave apprehension, when the Development Authority says it has anxiety, they are saying that against a background of apprehension and anxiety. This is no more than a final body blow and I believe that it has been a deliberate blow.
I remind the Committee once more of what the National Farmers' Union said at the time of the Price Review:The Unions maintained that the disincentive to pig production had been excessive in recent years, and that the fall in production might quickly lead to the gap in our market 1094 being filled by overseas suppliers. Once lost, this market would be difficult to regain.The only difference this Agreement has made is that this market will not be difficult to regain, but the purpose of the Agreement is to make it impossible to regain it. I do not intend to discuss the Anglo-Danish Agreement. It will have to be discussed in a far wider context. We shall have to have far more information and to know what happens in the negotiations which are at present proceeding. My complaint is that the industry has not been consulted, that there has been no opportunity for discussion. In fact, I believe that it has been deliberately misled. No one can deny, whatever the merits of this Agreement, that it is a complete renunciation of all the previous Government statements about agriculture.
§ Mr. Marcus Kimball (Gainsborough)
I have been trying to follow the argument of the hon. Member most carefully. He said that pig producers had been sold down the river. Could he explain what protection the British farmer gets from a tariff? Surely the farmers' guaranteed price comes from the Exchequer and not from the tariff?
§ Mr. Willey
I should like to be in a position to offer solace to the hon. Member. I should like to be in a position to say that the Anglo-Danish Agreement was no more than a side payment of £6½ million to £7 million at the taxpayers' expense. There were some grounds for believing this, because we know that the policy of the Government before the war was to get reduced supplies at greater expense.
We cannot, however, come to that conclusion, however comforting it may be to the hon. Member for Gainsborough (Mr. Kimball), who, I know, is rather doctrinaire in these matters, because we know the assurances which are written into the Agreement. We know that an undertaking has been given to the Danes that they will have a larger share of the British market and that subsidies must not be used to make nugatory the opportunity given to the Danes.
I now quote an authority which, I hope, hon. Members opposite will accept. The Lord Privy Seal, speaking in the House of Commons and not in his constituency, which is quite another 1095 matter, said that any sacrifice certainly involved damage and that it would be wrong to say that no damage would be done. That is saying that it would be wrong now for the N.F.U. to believe that it would be difficult—
§ The Minister of Agriculture, Fisheries and Food (Mr. John Hare)
The hon. Member has quoted my right hon. Friend the Lord Privy Seal. Taken in context, my right hon. Friend was quite clearly referring to the damage to the taxpayer.
§ Mr. Willey
No, he was not. It is clear that he was referring to the damage to the producer. It is quite clear that the Agreement says that the increased opportunities in the United Kingdom market must not be frustrated by subsidies. The Government are right in saying that they are maintaining their present subsidy policy, but it is quite untrue to say now that that policy is not affected by the Anglo-Danish Agreement.
What I want to know, and what the industry wants to know, is the extent of the damage, What is the extent of the damage that the industry can now bear? We know that in the present year—these are official estimates—we shall have a shortfall of 1¼ to 1½ million pigs on the domestic market. It is only at the end of the year, when we have suffered this shortfall, that the Anglo-Danish Agreement comes into effect.
§ Mr. Willey
As my right hon. Friend says, it will be after the election.
The Government have deliberately depressed pig production. They have drastically reduced production. At the end of the year, this will be the standard of production against which the concessions to the Danes are made. It is not surprising, therefore, that the industry should believe that the damage it will suffer will be substantial.
The industry knows well enough that the Agreement with the Danes makes it clear that the stabilising adjustment that we have got will provide only an alleviation and a slight help to the bacon industry. The industry is realistic enough to know that we cannot resort to the devices of separate guarantees for bacon pigs or grading and deadweight, because the Danes will say that this is 1096 an evasion of the undertakings which they have been given.
It may be argued that there is scope for an increased market at the expense of other imports, but, again, we cannot accept this argument now. The other importer whom we had in mind was the Dutch, but for other reasons Dutch imports have fallen sharply in the past few months. What we are rather concerned about is the likely increase of imports. We are worried about the possibility of Commonwealth imports, particularly from Canada.
From every possible viewpoint, the announcement of the Agreement could not have come at a worse time. The Government took consolation that we had reached the bottom of the trough of the production cycle of pigs. It is at that moment that we get this announcement. Looking at the market returns for the past three weeks, it is clear that the announcement has served artificially to depress the trough even lower.
To sum up, it is undeniable that over the past few years the Government have deliberately taken steps to prejudice the pig industry. At the same time, through being either too doctrinaire or too negligent, they have not taken steps to provide any stability for the industry. Now, at the moment of its greatest weakness, we get the announcement of the Danish Agreement.
My indictment of the Government is this. After Exchequer support running to £326 million, a good deal of which has been used merely to mitigate the harmful effects of Government policy, the Government may now, in spite of this expenditure, reduce the industry to its pre-war level and certainly to its prewar unsettled condition. The root of this widespread deep anxiety is that we all know what happened to pigs and to the pig industries under the Tories before the war.
§ Mr. Willey
In spite of the Agriculture Act, 1947, and in spite of even the Agriculture Act, 1957, we have the threat of that happening again. [Interruption.] The hon. Member for Kidderminster (Mr. Nabarro) knows this as well 1097 as I do. He is showing Dutch courage. When he is disturbed about something, he sits on his seat and tries to shout down whoever happens to have the Floor.
§ Mr. Nabarro rose—
§ Mr. Willey
No, I will not give way.
The real anxiety which disturbs the industry is that it remembers and is well aware of what happened before the war. It knows that it can happen again, in spite of the public investment in the industry and in spite of the safeguards of the 1947 and 1957 Acts. If that happens, it will be the betrayal of everything that my right hon. Friend the Member for Don Valley has stood for. More than that, it will be a profligate sacrifice of an enormous public investment in an essential basic agricultural industry.
§ Mr. Nabarro
Would the hon. Member not readily confess that the consumption of bacon during the last twelve months is four and a half times as great per head of the population as when the right hon. Member for Don Valley (Mr. T. Williams) rationed it to an ounce and a half a week?
§ Mr. T. Williams
Was it not, and is it not, because the Government of 1945 did exactly the opposite to what the Government of 1919 did, when we set out to produce the bacon that the consumers are now consuming?
§ 4.38 p.m.
§ The Minister of Agriculture, Fisheries and Food (Mr. John Hare)
The hon. Member for Sunderland, North (Mr. Willey) has treated us to a speech which started with sweet reasonableness and then got wilder and wilder. The allegations which he has just made will certainly not do his own party much good. If they were listened to by the farming industry, they would do it great damage.
Before starting to deal with the hon. Gentleman, however, as I shall do with considerable pleasure, may I defy the rules of order by saying how much I wish to join with the hon. Gentleman in what he said about a very old friend of ours, the right hon. Member for Don Valley (Mr. T. Williams). We were all very sad to read the news over the weekend that the next Parliament will not 1098 see him among us. The whole of the House of Commons will miss him. We love his down-to-earth good sense—although I am not sure that it was being shown a few moments ago—his good humour and his kindliness. His love for agriculture has been of great service not only to his party, but to his country. We shall all deeply regret the departure of an old friend to agriculture.
I very much welcome the opportunity that the debate gives me to state categorically, once again, that the Government want to see a stable and efficient pig industry in this country. The announcement that the bacon tariff is to go has been used as an excuse by a few people and by one—I am glad to say not more than one—national newspaper for scaremongering. I am sorry that the hon. Member for Sunderland, North seems to have added his name to that number in a speech which can certainly only add confusion to the mind of the average farmer.
I realise that the hon. Gentleman had a very difficult task to perform because he was, as he admitted, in a dilemma about criticising our Agreement with Denmark for the removal of the tariff on bacon. Having listened to the hon. Gentleman's speech, I do not think that he got out of that dilemma very well. His excuses for his change of mind were that it was badly timed and that, anyhow, he preferred bulk buying. I will tell the hon. Gentleman straight away that we do not prefer bulk buying.
Like Agag, the hon. Gentleman trod very delicately. My researches show that, somehow or other, the hon. Gentleman managed to avoid voting on the introduction of the tariff. I regret to say that his right hon. Friend was dragged into the Lobby. So was the hon. Member for Derbyshire, South-East (Mr. Champion), but somehow or other the hon. Gentleman did not vote against the tariff, as the rest of his party did.
We should, at this stage, state in plain terms why, as a Government we reached this Agreement, because this is what has triggered off some of the irresponsible criticism. The first thing is to get this bilateral Agreement with Denmark into perspective. This arrangement will be part of the Agreement to establish a free trade area in Scandinavia, Switzerland, Austria and Portugal. I hope that at this 1099 very moment that Agreement is being concluded in Stockholm. The Agreement holds out golden opportunities to Britain's traders to expand their exports.
The National Farmers' Union has gone on record as saying that it would not wish agriculture to be the cause of a breakdown. It realises, as do all reasonable people, that we in this country live by trade and that out of prosperity come the demand for high quality foodstuffs and—let us not forget it—the cash to pay guarantees to farmers. Let us make no bones about that. We are all in this together. I am certain that it would be irresponsible lightly to throw away this great prize. And in our judgment, without this Agreement with Denmark we should not have had this free trade area.
But we were determined that the price which had to be paid should fall not on pig producers, but on the taxpayer. I can say with absolute clarity that the removal of the tariff will not reduce the returns of pig producers in this country by a single penny. This is absolutely incontrovertible. I do not know why the hon. Gentleman took the line that he did.
Why was the National Farmers' Union concerned at the removal of the tariff? As I see it, it was concerned not at the direct effect, but at the risk that the Government in these new circumstances might cut the guaranteed price for pigs, either for the purpose of recouping the loss of revenue from the tariff or to guard against any possible fall in price arising from the tariff removal. We readily recognised that farmers were entitled to assurances in the clearest terms on those points. So my right hon. Friend the Chancellor of the Exchequer said immediately that, in fixing guaranteed prices for pigs, no account would be taken of the loss of revenue from the tariff or—this is just as important—any fall in market price due to tariff removal. I do not think that anything could be clearer than that. The cost of this Agreement falls on the taxpayer, not the farmer.
§ Mr. Willey
I am sorry to interrupt the right hon. Gentleman, but this is important. Is he giving us a guarantee that there will be no further reduction of the guarantees already provided? Is he also giving us a guarantee that the 1100 Danes will not export on to the British market at the expense of British producers?
§ Mr. Hare
I mean exactly what I said. Perhaps the hon. Gentleman will allow me to make my speech.
I will say this, in addition, on the point on which he tries to question me. Pig producers will receive the guaranteed price for every score of pigs they produce, whatever the market price. Even if bacon producers get slightly lower returns, which I do not think is likely except in the short run, this will be counterbalanced by the higher returns for pork producers. This is unarguable. I am, therefore, glad that the hon. Gentleman raised that point.
The hon. Gentleman turned then to the general problem of the effect of this on bacon producers. He tried to make out that the Government had been following a policy which he had strongly disapproved of in the last two years. He tried to suggest that if the bacon industry and bacon pig producers are left without some action—which he has not specified, for he did not make a constructive speech—they will be ruined. That is not true. It is not true that, when bacon prices fall, the result is a large permanent fall in returns to bacon pig producers. The guarantee system ensures that they are largely protected.
We had some experience, as the hon. Gentleman will remember perfectly well, very soon after I came to my present job in the early part of 1958. At the time I gather that I was considered to be very innocent when I said that the normal relationship of pork pig and bacon pig prices would be re-established in a few weeks, but, in fact, it happened. If the removal of the tariff should lead to a temporary drop in bacon pig returns, still, in a few weeks, things would straighten out, with the Exchequer taking the strain.
We must remember, also, that bacon pig producers have their special advantages. We introduced only this year separate stabilising limits to prevent their returns from falling drastically at any time. Out of the general money available for the pig subsidies £l½ million to £2 million go in special quality premiums to bacon pig producers.
1101 The hon. Gentleman did not say much about bacon curers, but he brought them into his speech and I should like to say something about them. The removal of the tariff presents a challenge to them. In looking at the challenge, I would say, first, that we have to remember that the Danes can surely have no interest in smashing the bacon market in Britain. Their producers enjoy no guaranteed price as ours do, and if the market were to collapse it would be the Danish producers who would bear the brunt. I know that, as the hon. Gentleman rightly said, their pig numbers are on the upward part of a pig cycle. But I am sure that the Danes will continue to study the market situation here through the Bacon Consultative Council, which has done such valuable work in exchanging information about market prospects, and will adjust their marketing policy to the situation here.
Secondly, the guarantees to pig producers sustain the supply of the curers' raw material. When the price of bacon falls, the curers are able to get their raw material cheaper.
In all this the only risk is that this scaremongering—the hon. Gentleman is the last scaremonger to speak on the subject—may frighten some specialist bacon producers out of production. On this point I do not think that there is any disagreement between the N.F.U., the bacon curers and the Government. We are all concerned to reassure farmers. Of course, if many farmers panic and go out of pigs, we shall lose our share of the market. But from what I have said I am sure it must be clear that that is not necessary. I really would like to see a halt to this defeatist talk that we cannot compete with the Danes. This is, as I have said, a challenge to our bacon curers. They are determined, I know, to see that British bacon enjoys a reputation as high as, if not higher than, Danish bacon.
As the Committee will have seen from the last Report of the Pig Industry Development Authority—PIDA; I am glad that the hon. Gentleman paid a tribute to it—a code of practice for bacon production has been worked out and introduced. I am informed by PIDA that curers representing 90 per cent. of the output of Wiltshire bacon have voluntarily accepted the code. That 1102 shows how co-operative bacon curers have been in this first step towards a marking system for home produced bacon. PIDA and the curers are working hard on that, and want to make further progress. I am sure that it is the goal that we must reach.
In his speech the hon. Gentleman, among many rather wild things, talked about damage and wanted to know the extent of the damage that we were doing to the industry. I have dealt with that by saying that we have not done any damage to the industry. The hon. Gentleman has grossly misrepresented the facts.
The hon. Gentleman went on to make an attack on the Government's policy on pigs in the last few years, and I should like to say a word about that. The hon. Gentleman managed to imply that hon. Members opposite disapprove of the drop in pig numbers which has taken place since 1958. He suggested that they had dropped to desperately low levels and should be immediately increased. That was what I inferred from what he said.
Let us look at the facts. The hon Gentleman knows very well that in 1957 there was a sudden and substantial rise in pig breeding in this country which reached a peak in the spring of 1958. Given present costs of production and the market situation in this country, we had an embarrassing number of pigs. Since the spring of 1958 there has been a decline—a substantial decline—in pig breeding. It is about 20 per cent., and it has brought numbers back to the levels of 1955 and 1956. In 1958, the subsidy was running at the rate of about £40 million a year—33 per cent. of the market price—and it threatened to go higher. Therefore, we cut the price. I really believe that right hon. and hon. Gentlemen opposite, in responsible mood, would agree that any responsible Government would have done exactly what we did.
At the last Review, as a result of our action the subsidy had dropped to a rate of £20 million a year—only 17 per cent. of market price. So it was unnecessary to discourage production further, and we left the guaranteed price unchanged. That, I would remind the Committee, was a decision that was part of an agreed settlement with the National Farmers' Unions. Hon. Gentlemen opposite must be honest. They cannot pretend that last
1103 spring they urged us to increase the guaranteed price so as to bring pig breeding back to its 1958 peak.
Since the spring the decline in pig breeding has been slowed down. The Committee may be interested to hear that a sample census in the first week of July showed—I have received the figures only today—that the decline appeared to have stopped. The estimated breeding herd rose by some 17,000 sows—5 per cent.; small, but interesting. I hope that the Committee will take note of it. I believe that if it were not for the scare talk that is going on this change in the trend might well have proved permanent.
There is talk of bacon factories being starved of pigs in the autumn. I admit frankly that, of course, there will be fewer pigs this autumn than in the past year. But I would remind the Committee that the bacon factories bought substantially more pigs in 1958 than in previous years, and made more bacon in the first half of 1959 than in the same period in either of the two previous years. Any decline would be from a relatively high level.
I have been asked by the hon. Gentleman what is the Government's attitude to the future of the pig industry. There is no economic reason why pig breeding should decline any further. The present guaranteed price—46s. 9d. a score—yields a profit to reasonably efficient farmers. We have already, in my view, come to the end of the adjustment set in train by the price cut in 1958. The only thing which could cause a further decline in pig breeding is a loss of confidence caused by the sort of talk that we have heard this afternoon.
I have already explained that the removal of the bacon tariff in two stages in 1960 and 1961 will not in any way hurt pig producers here. The assurance given by the Chancellor of the Exchequer is quite clear and definite on that point. I was glad to see that the Convener of the Pigs Committee of the Scottish N.F.U. said:Home producers would have to watch their step that they did not destroy their own bacon market by stopping production of pigs. The danger was in British pig producers taking cold feet.1104 These are his words—not mine—and I commend them to the Committee and to the farming industry.
Farmers can, I know, say, "You have promised not to cut the guaranteed price because of the tariff removal. But you could cut it for other reasons." I propose, therefore, to do something very unusual, because of this sense of alarm which has been aroused by irresponsible talk. Although what I propose to do is unusual, I believe that it to be justified in the uncertainties of the present situation. I hope that farmers throughout the country will listen carefully to what I am now going to say.
I want farmers to be quite clear about the Government's intention. We want to maintain pig production on an efficient basis. I can say now that we have decided that in the Annual Price Review next year the standard price for pigs will not be reduced, except for any adjustments which would follow automatically from the feedingstuffs formula, which could be either up or down. There is a precedent for doing this, which probably the right hon. Gentleman and the hon. Gentleman will remember; my predecessor did this in 1956 in relation to the price of fat cattle at the 1957 Review.
I am not, of course, saying now what the price will be. That must be fixed after the Review, after taking account of everything, including the size of the herd, market prospects, changes in costs, and so forth. But I am giving a definite assurance, on behalf of the Government, that the price will not be reduced next year. That shows that the Government still want to see an efficient and effective pig industry in Britain. It means that farmers can have confidence in pigs. And it is my earnest hope that nothing will be said today which will be aimed at shaking that confidence.
§ Mr. Willey
The right hon. Gentleman has made a useful pre-General Election statement, which we treat as such, but surely he appreciates that what we are interested in is what is to happen after the Anglo-Danish Agreement comes into effect.
§ Mr. Hare
As for the hon. Gentleman talking about election speeches, of all the election speeches that I have ever heard his was the most blatant. If he and his right hon. and hon. Friends want to raise further points in the debate, I 1105 am sure that my hon. Friend the Joint Parliamentary Secretary would be delighted to make a short winding-up speech at the end of the debate.
§ Mr. T. Williams
I think that it will be as well for the industry and for the nation if we return to a calm atmosphere and try to ascertain the truth of the situation. Are we to understand the right hon. Gentleman to mean that at the next Price Review, which is six, seven or eight months ahead, there will be no reduction in the price of pigs under the 1957 Act, whatever may be the number of pigs next February or March when the February Review is taking place?
§ 5.2 p.m.
§ Mr. A. V. Hilton (Norfolk, South-West)
I should like to thank my hon. Friend the Member for Sunderland, North (Mr. Willey) for initiating this debate on a subject which is of great concern to many of my constituents. I was a little disturbed by the hilarity from the benches opposite on this important matter. I notice that hon. Members opposite are still amused at this, but I think that if they were to come to my constituency and see the many empty piggeries which until a year or two ago were full to overflowing, they might take this matter rather more seriously.
I was pleased at the manner in which the Minister concluded his speech. I was also interested in what he said about his intention to bring stability to the pig industry. But I must confess that he has rather a strange way of trying to achieve stability amongst the people concerned with pig production. Neither side of the Committee can disagree about the reduction in the pig population during the last year or two. I have brought with me a number of the monthly statements issued by the Ministry of Agriculture, Fisheries and Food setting out quite plainly that during nearly every month for a year there has been this gradual decline in the pig industry. Particular mention is made nearly every month of the reduction in breeding sows. As my hon. Friend has reminded us, the reduction has assumed rather alarming proportions. It is something like 1¼ million or 1½ million or, 1106 as the Minister himself said, some 20 per cent.
We who deal with farmers know that they are pretty shrewd business people, and the number of empty piggeries is not just an accident. The reason is that there is not nearly the security in the pig industry which the farmers would like. If there is a decline in the cattle trade, buildings which have been used for cattle can be used for pigs, but farmers cannot do the reverse. They cannot push cattle into piggeries. Therefore, many of them are standing empty at the moment. This is most noticeable on small farms, many of which I have in my constituency and in my county, although this applies also to some of the bigger farms. Only this weekend I was reminded of a farmer in my constituency, five miles from where I live, who for a number of years had had a turnover of 1,000 pigs a year who is now completely out of them.
However, I am more concerned with the small farmer, the man who has to work seven days a week to make a living. The big man can often take a chance and gamble with pigs, but the small man is not often in this position. So it is the small farmer who invariably gets hit the hardest when these trends appear in agriculture, as has happened recently in the pig industry. Hon. Members on either side of the Committee would be very reluctant to go into industry unless they were pretty sure of a safe return for the money which they invest. That is all that the small farmer is asking, that he should have a fair return for the money that he is investing in this industry.
My hon. Friend the Member for Sunderland, North referred to the prewar days in agriculture. Quite recently I was reading a report on bankruptcy in this country, and I noticed that farmers were in the unenviable position of being at the top of the bankruptcy "league". Certainly in the 1920s and 1930s many thousands of farmers went that way. Of course, I am not suggesting that conditions have got to that pitch, but when we read these things we are certainly made to think.
This uncertainty in the pig industry has already had some effect on another aspect of agriculture. In the last ten or twelve years the industry has lost 1107 some 150,000 regular farm workers. I am not suggesting that they were all engaged in the pig industry, but many of those who have been lost to agriculture had a lifetime's experience—thirty years or more—in agriculture. Only recently we discussed redundancy in another industry and the payment of compensation to workers who have lost their jobs.
I can say, and I speak with some authority as senior organiser of the National Union of Agricultural Workers in the senior arable county in the country, that already farm workers who become redundant are talking in terms of asking for compensation in the same way as compensation is proposed to be paid to workers in the cotton industry when their employment is no longer available. Our farm workers would far sooner be engaged in doing a really good job than be paid any sort of compensation for being redundant.
Of course, this decline in the pig population owing to the worsening position is all linked with the question of men having to leave the land because farmers, especially the small farmers, are unable to plan ahead. They ought to be able to make their plans in the same way as people in other industries.
I should like to add a word or two to what has already been said about the impending retirement of my right hon. Friend the Member for Don Valley (Mr. T. Williams). He was in Norfolk two or three days ago and all the farmers in Norfolk, as, I suspect, in all parts of the country, have a genuine affection for him. Many of them like to refer to him as "Honest Tom" because they always considered when he was Minister of Agriculture that they would get a fair deal from him. Whether it was pigs or any other phase in agriculture they knew that they would get a fair deal with my right hon. Friend at the helm.
We have a limited amount of time at our disposal and I do not intend to delay the Committee, especially as it was only last week that we were talking about shorter speeches, a suggestion with which I agreed quite a lot. I repeat that I was pleased to hear the way in which the Minister finished his speech, but I appeal to him to see that farmers, especially those producing pigs, get a fair deal. I am anxious that those who have the 1108 facilities to do so should be encouraged to produce pigs to the maximum by being given the stability which the Minister at the beginning of his speech said he favoured.
§ 5.14 p.m.
§ Sir Anthony Hurd (Newbury)
I fully agree, of course, with the hon. Member for Norfolk, South-West (Mr. Hilton) when he reminds us that farmers always talk about the need for stability in the pig market. They yearn for stability, but the pig is the one creature on which many will always have a flutter. Some are always in and out of pigs. I have all my time stuck to them. Looking back over the past thirty years or so, we find that the pig is the product on which many a farmer likes to gamble, and he does not always have to hit the jackpot.
I was relieved by what my right hon. Friend said this afternoon. Quite frankly, I was not happy with the first statements made by Ministers about the proposal to make it possible for Denmark to come into the Outer Seven trading group. It seemed to me that there were too many negatives about the assurances which Ministers made, but this afternoon my right hon. Friend made it clear. Even if he did not, I would like to say now that we as a Conservative Party are determined that pig production will continue to play its full part in the economy of British farming. We have always stood for that and as a party we shall continue to stand for it. Ministers come and go and, even if my right hon. Friend did not use these actual words, I am sure that he has every sympathy with that point of view.
My right hon. Friend has made it quite clear this afternoon that the Chancellor of the Exchequer, who is a very important person in these discussions, is facing the fact that by inducing the Danes to come into this trade group he will not only forgo £6½ million a year in tariff revenue on Danish bacon, but that he is prepared to face an additional charge on the general fund of farm price guarantees which today are running at a total of £240 million a year. It may be that instead of pigs costing, as they are likely to do this year, £20 million they will cost £24 million or £25 million to make up the market price to the price guaranteed to farmers today and which my right hon. Friend says is going to be continued to be 1109 guaranteed to the next Price Review which carries us through to 1961.
Ministers are facing the implications of the decisions which they are proposing to take in these trade discussions—a loss of £6½ million on the tariff and a possible further charge of £4 million or £5 million on taxpayers. I do not know what the figure will work out at, but, any way, it will be a charge to be borne in farm price guarantees. That satisfies me that Ministers are determined, as we as back benchers are determined, that the pig shall continue to play its proper part in farming.
I only wish that we could somehow instil this feeling of security and stability about which farmers always talk and about which the hon. Member for Sunderland, North (Mr. Willey) spoke, as did the hon. Member for Norfolk, South-West. But how can we do that today in the particular circumstances of the moment when the Socialist Party and the Daily Express have made an unholy alliance to try to undermine the confidence of farmers in pigs?
§ Sir A. Hurd
How can we meet that point? If the removal of the tariff on Danish bacon were to have the effect that some people have feared, it will be the bacon factories that are hardest hit because they will not get level supplies of the right quality of pig. Would it be possible for us so to gear the price guarantee on pigs as to ensure that there is a special premium paid on the right type of pig supplied in regular, steady numbers to the bacon factories? That would mean the curer making a contract with the producer to supply grade A pigs and the producer would get an assured premium for doing so. I think it would be worth the curer's while to make some contribution to that end as well as the Government so that we could have a steady bacon industry and one which is continuing to produce better quality bacon.
I would only give the premium on the pig which is going to match the Danish pig that produces the bacon which so many people in this country like. Some of our bacon is just as good as the Danish, and some is not so good. It is a specialist job to produce that type of pig, and that is why I would like the premium paid on it.
1110 If to this end the National Farmers' Union believes that a pig marketing scheme would be helpful and would enable its members to get together with the curers and with the people in the pork trade and in the manufacturing trade to develop markets which are today not fully expanded and to get a better sense of security and confidence in the industry, I would say to the N.F.U., "If you can get enough of your producers to agree that they want a marketing scheme "—and it comes within the four walls of the Marketing Act—" they should go ahead and do it."
Unless we are to have a complete out-and-out Socialist Government that will buy every pig and allocate it to a market, no Government could pretend to so manage the pig industry to satisfy all the people engaged in it. If the N.F.U. want a pig marketing scheme, I would say, "Go ahead and have one to see how you can work it. You may be able to sort the pig industry out better than we or the Socialist Government have been able to do."
I am not worried about the Anglo-Danish trade proposal. We have the right basic guarantee now reaffirmed and our pig industry can go ahead. I wish that it would go ahead with greater confidence and stability so that year by year we could feel that we were making the same progress with our pig business that we are making with our milk, beef and crop growing.
§ 5.20 p.m.
§ Sir Leslie Plummer (Deptford)
The last words of the hon. Member for Newbury (Sir A. Hurd) will receive full agreement from this side of the House. That is what we are asking for—that the people in the pig industry shall enjoy a stability of their market and an assurance of their future to produce the sort of pigs that we want at economic rates. We agree with the hon. Gentleman entirely on this matter, but I do not think that the earlier part of his speech will find the same sort of applause from this side. The words that he uttered to the pig breeders were not very comforting. He said that there will always be a gamble in pigs and that people will always go in and out of the pig industry. But is not this the trouble with the pig industry? The Government 1111 have made the pig industry such a gamble that it is an in-and-out business.
§ Sir L. Plummer
Let us see whether it is nature. Is it not a fact that if we are to have high quality bacon pigs we shall get them from the man who pays serious attention to matters like progeny testing, feeding, housing—the man who studies the animal and takes his business as seriously as the dairyman. What often happens is that the man who comes in and out of the industry feeds badly, is responsible for developing swine fever, houses the pigs badly and is in the business only for a quick profit. That is the man who has been encouraged by the Government. Whether he will be discouraged, I do not know.
When the Minister took office, he was photographed in Norfolk holding up pigs the wrong way.
§ Mr. John Hare
That is very much a question of opinion. I stick to the belief that it was the right way up.
§ Sir L. Plummer
It may be the silly Suffolk way of doing it, but it is not the universal way. If some of the things which are now predicted for the pig farmer happen, no decent British pig will be photographed with the right hon. Gentleman because of the trouble he is bringing to the industry. I recognise that in this matter the right hon. Gentleman is innocent. He is doing what he has been told by the Chancellor of the Exchequer. It is not the first time that a Chancellor has imposed upon a Minister of Agriculture a policy which he does not like, but certainly on this occasion he is imposing, for what he doubtless regards as perfectly good reasons, a policy which is harmful to the pig industry. However, I do not think that in exculpating the Minister in this form I shall give the impression that, until the Danish agreement was announced, everything was lovely in the pig industry. On the contrary, the falling figures show that there is—and has been—a good deal of disturbance and worry in the minds of pig producers.
I want to be brief and on this occasion I want to be as helpful as I possibly can. Apart from the Danish agreement, there are three influences which are 1112 making it difficult for the pig producer and which are inhibiting our producing in this country the sort of pig that we should be producing in competition with the Danes. I recognise that the Danes are specialist producers and that they concentrate on the production of pigs, but their system of agriculture is entirely different from ours. Even their system in respect of some of their subsidies for agricultural products is different from ours.
I should like to put a few inhibiting factors to the Minister, not in order of importance, but as they occur to me. The first concerns the reduction in the pig population. In this matter, I think that the Government should make clear what they want. I presume that the Government wish that the pig population should be reduced considerably. We gathered this from the White Paper. Now the trend is to be reversed. If this is not so, I do not understand the argument of the Government. First, they say, "Look how well we have done. Agricultural production is up." Then they say, "Look how well we are doing. The pig population is down." Which is right? Do the Government want more pigs? Do they want the bacon farmer to have a bigger or smaller share of the market? The Government should make up their mind to let the farmer know what is required of him.
As a result of cuts in the subsidies, many people have given up the production of pigs. That is the first inhibiting factor. The second factor, one that goes on continually, is the association of the prices paid for pigs with the prices of feeding stuffs. This is an equation which the average pig farmer cannot understand. He cannot understand how it is that the price of feeding stuffs seems to remain fairly constant while there is a diminishing return based always on the at-port price of imported feeding stuffs. No doubt it is a calculation which is clear to the Treasury, but I do not believe that it is clear to the Parliamentary Secretary. It is certainly not clear to the pig farmer, who finds, on the whole, that the price he is paying the miller for his feeding stuffs does not show the sort of correlation in fall with the fall in price. It would be worth while making the situation clear. In any case, this is a bit of a hardship on the man who, following the advice and 1113 request of the Government, is growing his own feeding stuffs and who finds that the situation, over which he has no control, makes the return on his pig production so difficult.
I should now like to turn to the question of grading. Are not we raising grading on bacon pigs to a ridiculous point, a point at which it is extremely difficult for people to breed pigs? I have some returns here relating to some pigs which I have sent to market in the last few weeks. I do not know why I should get for an AA pig—that is a pig shorter than 800 millimetres; I always say "centimetres", but I think that it should be millimetres—considerably less than for a pig over 800 millimetres. A pig of the same weight which is 790 millimetres compared with a litter brother or sister of 810 millimetres may bring in as much as 10s. less. I believe the reason for this is that the Treasury has so organised grading that it has made it a hidden cut in the subsidy. I should like to know from the Minister how many pigs can reach AA-plus grading in excess of 800 millimetres. We are reaching the situation of insisting that farmers shall try to get high grading figures at a time when it looks as though high grading figures will be absolutely uneconomic because of what will happen to the industry in the future.
Finally, I should like to say a few words about curing. The hon. Member for Newbury said that there was nothing wrong with the British pig and that we could produce pigs which are as good as those which the Danes produce. That is demonstrably true. What we have not been able to do is to produce the uniform cure which the Danes have produced.
Almost every bacon factory in this country has a different cure. Where I live in East Anglia we are surrounded by bacon factories, but one can never be sure, when sending pigs there, that exactly the same Wiltshire cure will be given. People go into the shop in the village where I live and ask for Danish bacon. They say that it is "always the same". It is not that the Danish pig is better but that the Dane has studied our market and our preferences, ensuring that in each district, week in and week out, there is bacon of the same cure. We have not been doing that.
1114 There has been a move in this direction. The bacon factories have been waking up to the fact that there has been this brake on sales and an encouragement to the British housewife—even the wife of the British farmer—to ask for Danish bacon in preference to the British product. But the bacon factories can do the job properly only if they have a really reliable, viable throughput; they can do it only if their processes are working fairly well up to capacity and if those in charge are convinced that they will receive a steady flow of pigs from the farmers. Otherwise, they will not go to the trouble of seeing to it that there is no casualness in the curing in order to produce a piece of bacon which is competitive with the Danish product.
What chance is there of these things being done now? The Minister has reduced the bacon curing industry to a state where, if this were the coal industry or the steel industry, Opposition Members would be up in arms complaining about the fact that mines or factories were having to work to such low capacity figures. Unless something is done to reassure the farmer, there will be no real prospect of improvement. The Minister's speech can provide no basis for assurance because his speech guaranteeing that deficiency payments will continue to be made will be effective only so long as the Treasury permits it to be. If the subsidy rises to a figure which the Treasury does not like, it will be taken as an excuse for cutting it still further. This has been our experience in agriculture, in the production of eggs and in the production of other commodities. The Ministry must think more carefully and more clearly. It must regard the pig industry of the country not against the background of the Danish agreement but in the light of the insecurities to which it has been subject during the last three years.
§ 5.32 p.m.
§ Mr. W. T. Aitken (Bury St. Edmunds)
I have in my constituency a bacon factory which is working to just under one-third of its normal capacity. Nobody can live in that part of the country for long without realising what a very important part the bacon factory plays in the pig industry. Bacon factories take only about one-third of the total pig production of the country, but they provide a stimulus 1115 to breeding and the scientific development of the right kind of pig to an extent far greater than the other two-thirds of the industry, namely, the pork cutters and manufacturers, provide.
It has always seemed to me that the problem we now face is really one of imbalance. The pork cutters and manufacturers will take any kind of breed or any quality of pig, and they take it on a live weight basis. The imbalance between the pork side and the bacon side is one of the factors to which much more careful attention should be directed. The old Scots clergyman may have been right when he took the pig as the subject of his sermon and said,Dearly beloved brethren, isn't it a sin, When we peel potatoes to thrown away the skin?The skin feeds the pig, and the pig feeds you—Dearly beloved brethren, isn't that true?It must certainly have been true of the pork pig, but the bacon producer is much more particular.
People generally just do not realise the amount of trouble and expense which a man has to bear if he wishes to go in for producing bacon pigs. His pig has to be sold on a dead weight and grade basis, and it is a very expensive animal to produce. One cannot blame the farmer who takes the easy way out. When the price the bacon factory is willing to pay does not suit him, he will go to the pork manufacturer. The bacon factory manager is in this dilemma, that, unless he can have the right numbers of pigs, he cannot pay an economic price and he cannot produce as good a quality as he would like to produce. The merry-go-round is such that the unfortunate bacon factory manager finds himself today in an almost impossible position.
I am not one who believes that the trouble in the industry is due to the removal of the tariff on bacon. The trouble started long before that. This is simply the last straw. The agonising screams from this particular camel are just as distressing as they would be if a ton weight had been thrown on its back. This has been proved to be so because, between 1954 and 1958, the Danes succeeded in increasing their sales to the British market by about 40,000 tons, with a tariff imposed against them in 1956, and the home market lost just about the same amount in that period. 1116 The real malaise of the industry, therefore, does not arise from the removal of the tariff. Neither is it a new problem, a I think my right hon. Friend will agree.
I know from my experience, and anyone who has visited bacon factories in his constituency will know, that the bacon industry can and does deliver to specification, and it can and does deliver a very high quality product. But, again, if the factories do not have the right kind of pigs, they have to make do with what they can obtain and, as a result, the quality of the product goes down. I am absolutely certain that if a way could be devised, by some rearrangement of the subsidies, so that we could provide a regular throughput to the bacon factories, the bacon factories of the country would be only too willing to do what was necessary and would be quite capable or organising themselves so as to compete successfully with any foreign imports. But, to do this, they must have the right kind of pigs at the right kind of price, and the producer who enters upon the arduous and difficult business of producing the right kind of pig must have his proper return. These things cannot be done under the present system.
If the Ministry of Transport were to drive an arterial road right through the middle of Bury St. Edmunds, it would be expected to pay a substantial sum in compensation to the people damaged by that project, which would, presumably, be in the general interest. The same considerations, I think, have applied in the cotton industry. We are prepared to face very considerable expenditure to assist the cotton industry out of the difficult position in which it now is as a result of action by the British Government. My right hon. Friend has made some slightly reassuring noises today, but he really must give a much more specific undertaking to the bacon industry. It is the bacon industry which I am most concerned about in this debate.
The removal of the tariff is to this business at the present time really rather like waving a rope in front of somebody who is just about to have a hanging in the family. One or two more definite assurances are needed. My right hon. Friend should give the industry some idea of what really is the optimum pig population which is desirable, in the broad 1117 economic interests of the industry. I should like to see him do that, and I believe that it could be done. Although I know that the Bosanquet Commission has committed itself against this, I consider that attention should be paid to improving the system by which the subsidy is now operated, particularly in regard to bacon pigs. I am quite sure that we could greatly help the bacon curing industry if we could devise, probably at very little cost, some method whereby we could stimulate the interest of the producer and induce him to send more pigs to the bacon factories on a regular basis. I believe that the Danes are a fairly reasonable lot to deal with. The Bacon Consultative Council, as the Minister said, has worked pretty well. I do not believe that the Danes would be entirely unreasonable about some degree of co-operation on the present state of the bacon market in this country.
We are bound to congratulate the Government on this Agreement with the Outer Seven members of O.E.E.C, but do not let us spoil it. It is only right and just to my mind, and very much in the interests of the community as a whole, that when the Government take action which is specifically injurious to an important industry, the community as a whole ought to share in relieving that industry of the unpleasant prospects before it.
§ 5.41 p.m.
§ Mr. F. H. Hayman (Falmouth and Camborne)
I agree with much that the hon. Member for Bury St. Edmunds (Mr. Aitken) has said, and particularly with his opening statement that the pig producing industry is closely linked to the bacon industry. I think I am correct in saying that one-third of the pigs produced in this country go to the bacon factories.
I am as concerned as the hon. Member is at the prospect of continuing the through-put for the bacon industry. If the factories are to continue in production they must have a reliable throughput, and I agree with both the hon. Member for Bury St. Edmunds and the hon. Member for Newbury (Sir A. Hurd) when they said that there ought to be some adjustment of the Price Review, to pay a somewhat higher premium for the bacon pig which has to be produced to a stringent specification.
1118 The Minister assures us that the Government would not have reached agreement with the Danes if the British pig producers were not adequately protected by the guaranteed price. That is very nice to write and to say in this Committee, but my experience over the last two or three weeks in my constituency has been that Ministers' statements do not carry very much weight. I am told that the one-third of the pig production going for bacon could receive considerably less than the standard price over the year, while the remaining two-thirds could get more under the present arrangements.
Since April, 1959, the difference has been limited by a special stabilising adjustment calculation. The Minister spoke about this this afternoon. I am told that even this could still result in prices of bacon pigs being 14 per cent. lower on average than the prices of pigs for other purposes, while the Government's guarantee obligations would still be fulfilled. I hope that the Joint Parliamentary Secretary will say something about that when he comes to reply.
I am quite sure that the bacon factories in my constituency and the pig producers will want an answer to a statement of that kind. The Minister made great play with what he called scare-mongering statements, and I think that I am therefore justified in quoting to the Committee the statements of some responsible organisations in this country in recent weeks. The British Bacon Curers' Federation, on 19th June, said:The Minister of Agriculture, it is true, has indicated that he recognised 'the importance of the Bacon Curing Industry in this Country', but unless drastic remedial Government action is taken this particular industry is heading straight for disaster.I did not say that; that is what the Bacon Curers' Federation has said. To quote from the British Farmer of 27th June, a greatly respected correspondent. Laurence Easterbrook, said:It seems to me, therefore (and I only hope I am wrong in this), that we are approaching a point where it will no longer make sense to exhort farmers to raise still further their standards of efficiency unless they are to be given a larger share of the home food market.He continued:When it comes to pigs, it seems even more like Alice in Wonderland. Here home production is 40 per cent. of our needs and steadily going down, with bacon factories half empty. Yet the powers-that-be can hardly conceal their delight.1119 That is what a responsible journalist said in the British Farmer, which, I believe, is the monthly organ of the National Farmers' Union.
This is what the National Farmers' Union said in a Press statement issued on 17th July, only a few days ago:This Council expresses grave apprehension at the implications of the Government's recent Agreement with Denmark for the British pig-meat industry.Later, it said:It is estimated that even in the year 1959–60 there will be 1¼ to 1½ million fewer pigs slaughtered in the United Kingdom. Not only will this result in a loss of market for the home producer, but a switch from pig production to other commodities through lack of a proper incentive must increase the pressure on the markets for eggs and milk.I do not accuse the National Farmers' Union of making a scaremongering statement, but that is what it said at the end of last week.
I represent a Cornish constituency in which the only two bacon factories of the county are situated. I have had great concern expressed to me during recent weeks by the bacon factory interests, the National Farmers' Union, Cornish Branch, and, indeed, by the trade union which organises the workers in the bacon factories. It seems to me that there must be some basic cause for concern by all these people who get their living out of the pig producing industry
As we all know, there is a farming trinity of production—pigs, milk and eggs. They are vastly important to the small farmers. It is all very well for the larger farmers, as the hon. Member for Newbury said, to have a flutter in pigs, but the small producer today cannot afford a flutter of this kind. As my hon. Friend the Member for Norfolk, South-West (Mr. Hilton) pointed out, bankruptcies are increasing and farmers head the list of business people who are bankrupt.
§ Mr. Walter H, Loveys (Chichester)
I think that in bankruptcy the farmers have- always come second to the builders, and the builders are still beating us at the moment.
§ Mr. Hayman
Cornwall is an area of high unemployment, and it seems to us in my constituency that we are fast returning to the position of the 1930's I know that the Joint Parliamentary Secretary laughs at me for saying that, 1120 but as I reminded him in other debates this year, the production of broccoli and new potatoes, two of the main farming crops in West Cornwall, has dropped back to the pre-war level, although a few years ago it was at least double the prewar level and in the case of new potatoes much more than that.
The Minister and the Chancellor of the Exchequer are the men mainly responsible for the uncertainty throughout the farming industry, and particularly in pig production and the bacon curing industry. The time has come for the Government to get out altogether and to give somebody else a chance to give security to the industry.
§ 5.52 p.m.
§ Mr. Douglas Marshall (Bodmin)
May I begin by paying a compliment to the right hon. Member for Don Valley (Mr. T. Williams)? May I join my right hon. Friend in expressing the regret which we felt on hearing that the right hon. Member for Don Valley is to leave us at the end of this Parliament. I have had the privilege and honour of being here for fourteen years and of sharing the many different views which have been expressed by hon. Members on this side of the House on what has been done in agriculture, but it was with great sorrow that I read in the newspapers that the right hon. Gentleman does not intend to stand for Parliament again.
Two things in particular struck me in the speech of the hon. Member for Falmouth and Camborne (Mr. Hayman). First, in our discussion on the pig industry today I do not see any necessity to enter into the question of new potatoes and broccoli, but that leads me to the comment that whereas the horticultural side of agriculture is not guarded by the Agriculture Acts of 1947 and 1957, the pig industry is so guarded, and this makes it possible to secure for the pig producer a measure of protection, without a tariff, whereas in the horticulture industry the tariff plays the most important part possible.
The hon. Member also said that in his part of Cornwall any statement made by the Minister did not carry very much weight, and he then proceeded to ask the Joint Parliamentary Secretary for replies to certain questions and to ask the Minister to reinforce certain statements. I did not understand that.
§ Mr. Hayman
I said that up to now, at any rate, the Minister's statements in this controversy had carried little or no weight with the people concerned. I asked the Joint Parliamentary Secretary to consider the points made by the hon. Members for Bury St. Edmunds (Mr. Aitken) and Newbury (Sir A. Hurd) about some readjustment of prices for bacon pigs.
§ Mr. Marshall
The point is that the statements made by my right hon. Friend so far have not been statements which the hon. Member's constituents have liked, but that does not mean that no weight has been attached to them.
When I first read in the newspapers that these negotiations were taking place with Denmark, at the time we were trying to negotiate a Free Trade Area, I was very worried and anxious, and I wrote to the Minister and told him about it. I must admit that I was unhappy when I heard what had taken place. Again I told the Minister so. The point which was exercising my mind, however, was the future problems of the pig industry as a whole more than the ad valorem duty being reduced by 5 per cent. in one year and by another 5 per cent. in another year. As far as I could gather from the hon. Member for Sunderland, North (Mr. Willey), who opened the debate, his chief worry, too, was much more about the pig industry itself than about the effect of the ad valorem duty.
I believe that good may come from the reduction in the ad valorem duty in the Free Trade Area because this has focussed attention upon the pig industry and has revealed in the House as well as elsewhere the anxiety and the worry which is felt about the pig industry in general. My anxiety has been considerably relieved today, because one thing which agriculture as a whole has wanted more than anything else is a form of stability for as long a period as possible. Because of the action taken with Denmark a much longer period of stability will follow from the announcement made by my right hon. Friend this afternoon than the pig industry and agriculture generally has had for a very long time.
§ Mr. Harold Davies (Leek)
A bankrupt may have complete stability but he has not much hope of existence.
§ Mr. Marshall
These references to bankruptcy are interesting, but those who live within areas concerned with agriculture and pig production do not share the views of hon. Members opposite that all these farmers are bankrupt.
§ Mr. Marshall
I am dealing with those who are not bankrupt.
My right hon. Friend today said that in the Price Review of February, 1960, the price relationship in respect of pigs will not be altered from the present relationship other than to take account of the normal changes in the feedingstuffs prices. This announcement will give to the pig industry stability for a reasonable length of time which it has not had since the days when rationing was abolished and when abundance took the place of food shortages all over the world.
Not only do I thank my right hon. Friend for his statement but, like him, I trust that advantage of the present situation will not be taken by a number of people in trying to impress upon a certain part of the agricultural industry an anxiety which in fact does not exist. My right hon. Friend knows to what extent this situation has worried me and how anxious I was. I did not mince my words with him. Today, however, he has reassured me. I thank him for his statement, and I believe that the pig industry has a better future facing it than it had before the negotiations with Denmark.
§ 5.58 p.m.
§ Mr. Harold Davies (Leek)
This debate is short, and we want the pleasure of the Minister's reply. I will therefore not trespass too long on the time of the Committee in elaborating the points which I want to make. Two points of view have been put forward by hon. and right hon. Members opposite. First, we were told that the pig industry has always been a bit of a gamble. Next we were told that we shall have stability in the industry for the first time. We were told that there is still to be a gamble in the future and that this agreement, which will cost the Exchequer £6½ million, need not cause too much worry.
1123 I am not concerned about the gambling aspect of the pig industry. Like my hon. Friend the Member for Falmouth and Camborne (Mr. Hayman), I am concerned about the small man who is not gambling but is earning his living and who is able to purchase from industry in the towns the goods which they produce because he has surplus money in his pocket.
In my constituency there are 1,400 farms of under 20 acres each. I do not know the exact percentage because I have not had time to work it out, although I could do so, but many of those farmers live on the pig industry, together with the production of eggs and milk. Not long ago they were encouraged to get a million pigs on their trotters. It is no good the Conservative Party pretending that they have not cold trotters over this. The arguments are very thin. Never mind all the election speeches, but there was that little song of an election in some of the speeches made this afternoon.
However, I am more concerned with the real stability of the small man who cannot get by if this pig industry is unhinged by this entire lack of policy and planning. First, the farmers were to get a million pigs on their trotters. They set about it. The little man built pigsties, poured capital into them. A good deal of that work was done on credit. Then suddenly he finds that he is no longer to get a return on his investment.
I was very grateful for the experienced explanation by my hon. Friend the Member for Deptford (Sir L. Plummer), who is in the pig industry, of the methematics of grading. One has to be almost a senior wrangler to understand the gradings in the pig industry at present; there are such shifts in it. The Minister himself has a charming face, and he is a charming gentleman. I remember the picture of him when the Government were advocating more pigs. There was a marvellous photograph of the Minister He stood there in all his glory with a little piglet hanging down from his hands. We shall have no piglets to hang down if the Minister goes on at this rate, with this lack of planning. Is the Minister answering me back? I have him on the hip now.
We can see that this Agreement has nothing at all to do with the economics 1124 of pig farming, and it is in addition to a lack of real policy for both the international and the home trade. I do not want to go into all the dialectics of the Big Seven, the Outer Seven, the Inner Six, but I have my doubts about this.
There was a Written Answer by the Minister the other day from which can be seen all the ups and downs of the pig industry over the years. Because of the time factor, I will not go into all the details of that now, but I would advise the Committee to read them. I asked the Minister a Question to which I had a Written Answer on Friday. It was about pig subsidies. The Minister told me that the subsidies paid to the pig industry in the United Kingdom were approximately £37 million—that is a round figure, the exact figure is in HANSARD—in 1957 to 1958 and £21 million in 1958 to 1959.
I agree with the Minister in that I do not want us on this side of the Committee to pretend that we are going to pour money into agriculture when we are returned to power. That would be a gross exaggeration, and it would be grossly unfair, but I accuse the party opposite of sacrificing agriculture to the City of London and to big industry. [HON. MEMBERS: "Rubbish."] It is no good hon. and right hon. Gentlemen opposite saying "rubbish". The entire economic history of Britain since the period of the Industrial Revolution illustrates the fact that, when it suits the party opposite, agriculture is pushed by the board, as it was in 1921, when that party caused more bankruptcies than anyone at any time. We will brook no more argument about that fact—and it happens to be a fact. That is why the Conservative Party, if it is not careful, will find itself losing the rural constituencies of Britain at the next election. I am annoying the hon. Member for Eastleigh (Mr. D. Price). I am pleased.
§ Mr. David Price (Eastleigh)
If the hon. Member would give way he would learn the truth of the matter.
§ Mr. Davies
I shall be finishing in a minute.
I would say to hon. and right hon. Members on both sides of the Committee that there are some sections of agriculture which we ought to try to keep out of party politics for the sake of the security 1125 of the country. For too long, I think, British agriculture, especially among the very small farmers, has been an issue of party politics. I sincerely hope that we shall look at this question of British agriculture in an entirely new light in the next few years, and especially for the sake of the small farmers and the pig producers.
§ Mr. D. Marshall
From 1945 to 1950 there was no party issue, and the hon. Member's party was in the Government and we were in opposition.
§ Mr. Davies
I will leave the argument there, because I must not trespass on the time of the Committee to reply to the hon. Member. It would be unfair to the Committee. I am glad that from this side of the Committee I have got the party opposite to see some of the truths of the matter.
§ Mr. D. Price
On a point of order, Sir Gordon. In view of the fact that the debate did not start until a quarter past four, would it be possible to have another half hour for it, in view of the further fact that there are a number of hon. Members who want to speak and who have contributions to make from both sides of the Committee?
§ The Deputy-Chairman
It is a matter for the Committee, but I understand that arrangements have been made through the usual channels.
§ 6.5 p.m.
§ Mr. A. J. Champion (Derbyshire, South-East)
I am delighted to learn that there are so many who wish to participate in the debate. Unfortunately, the intervention of the Prime Minister at half past three with questions until after four o'clock has inevitably shortened this debate—
§ Mr. Champion
—on this most important industry. However, we are glad to have this debate because it has, if nothing else, enabled the Minister to make a statement, a statement which has been accepted by some of his hon. Friends as completely satisfactory. I would say that his actual words must 1126 be studied most carefully, because we have had so many statements recently and so many conflicting statements on this whole business of pigs and pig policy. It has to be remembered, of course, that the Minister's statement that he will not reduce prices at the next Price Review must be taken in the light of the fact that by then the Danish Agreement will not be in operation. We shall not by then have felt any of its effects and the Minister will not be able to offset them or be able to do anything about its effects. All he is saying is that he will not in the next Annual Price Review reduce the present prices. That is not a really satisfactory statement at all, but, as I say, we shall carefully study what the Minister has said.
Despite the brave show which the Minister tried to put on, the fact is that this industry has during eight years been taken for a ride by the Tories—not in a Rolls Royce which the Tories normally use, but in an old T model Ford, a model with flat tyres on it, a Ford taken over a bumpy road, the driver, the Government, accelerating violently and then braking just as violently. The result is that the industry today has arrived at a point where it is shaken, where it is bruised, confused and despondent. It is not a bit of good the Minister saying that this is because of any words of the Opposition. The Minister said that we were trying to raise a scare, but what the pig producers and curers are worried about are the Tory policies, and not our words.
We all know the basic facts of the industry and the ease with which output is expanded and then contracted. We know, too, what were the conditions which existed before 1945, the conditions of the inter-war years, and we have to remember those facts and the conditions which we sought to end by the 1947 Act and the policies which we produced from 1945 to 1951. We did not want pigs to return to a state where they were "muck or money", "copper or gold". as was the case always up to that date.
What happened when this Government came in? "More pigs", cried the Minister of Agriculture in 1952. "Expand pig production", said the Annual Review of that year. They forgot to make adequate provision for the curing and marketing of the increased 1127 numbers of pigs which came along These are the facts of the industry at that time. They gave the green light to the industry, and as a result of that green light the industry immediately began to expand, and the result was that we had a chaotic condition created in the industry which was well described by the Bosanquet Committee.
Those Members who have read the Report of that Committee will remember its condemnation, which underlay the whole of the Bosanquet Committee's Report, of price fluctuations. Hon. Members will remember what the Committee said about the industry at that time, how prices fluctuated, how the numbers going through the bacon-curing factories fluctuated between 40,000 and 238,000 per week.
These were the facts, and in this chaotic situation which had been created by Government policy we had the Government's decision to end the controlled import of foreign pig products, to free imports and to apply a duty of 10 per cent ad valorem. I remember it because I participated in the debate. Then the right hon. Member for Blackpool, North (Sir T. Low), the then Minister of State, Board of Trade, when he introduced that Measure, said:Now a word about policy considerations. It has long been our policy in relation to pigmeat production to secure, first, development of home production and, secondly, to give preferential treatment to Commonwealth producers. The Ottawa Agreements provided for this by the use of quotas on foreign imports of bacon and ham and pork. During the war and since, throughout State trading, the quota system has been in suspense. With the end of State trading we had to consider how we should achieve the same purpose, that is the home producer first and the Commonwealth producer preferred to the foreigner. The alternatives before us were quota or tariff preferences.Later, the right hon. Gentleman said:From the producer's point of view, the tariff protects him and provides a way of avoiding violent fluctuation in market conditions … from the taxpayer's point of view, the tariff provides revenue."—[OFFICIAL REPORT, 19th July, 1956; Vol. 556, c. 1535–6.]The main consideration, said the right hon. Gentleman, was to protect the producer from violent market fluctuation. The revenue was only a secondary consideration.
Now, the present Minister of Agriculture tells the N.F.U. that 1128The tariff on bacon was introduced in 1956 primarily for the sake of the revenue that it would bring in.The purpose of the tariff has been entirely reversed. It was one story when the tariff was introduced, and now it is another story in 1959 when it is coming off. This is typical of the Government's actions, particularly in relation to the agricultural industry.
The year 1957 was the first year of the tariff arrangement, and that was a particularly bad year for the pig industry. The right hon. Member for Blackpool, North said, in effect, that things would be better after the Order applying the tariff had been passed, but nothing of the sort happened. In January, 1957, the price of No. 1 English bacon was 328s. per cwt. In March it was down to 247s. In July, it went up to 314s. but dropped in August to 256s., recovering to 293s. in September and falling in October to 227s., which was the lowest price since 1955.
Is it any wonder that in these conditions pig producers were confused so that total marketings were sharply reduced and the pork market was easily able to absorb available supplies, and then a sharp increase in August and September brought about an over-supply to the bacon market? The year 1957, instead of being what we had been promised by the Government—a year of stability under the protection of the tariff—was a year of violent fluctuations in price, with the result that the industry was thoroughly unstable during that period.
The producers themselves had to do something about it, and the National Farmers' Union took action. As a result of their direct approaches to the Danes and the Dutch, the Bacon Consultative Council was formed, which was afterwards joined by the Swedes and the Southern Ireland producers. They entered into an agreement which worked reasonably well. I thank the producers and the N.F.U. for their action in that connection.
The Minister of Agriculture today uttered a few words of praise, but we should not forget that now into this arena is thrown the latest agreement with Denmark. How many of those who are associated with this Council have the faintest notion of what will now happen 1129 as a result of the Danish agreement and its effect on this Council which came into being and produced something like order in the industry?
This, coming on top of eight years of Tory disaster, has naturally made the industry apprehensive. The Minister seeks to allay the industry's natural fears and says, in effect, that the Annual Review will be used to ensure reasonable prosperity to the industry. But this debate has pulled a little more than that out of the Minister.
The Minister and the Government say to the Danes, and here I quote the background notes issued by the Minister of Agriculture:The Danish Government has asked for and received an undertaking from the British Government that nothing will be done by way of changes in subsidy policy which would take away the benefits which they will obtain from the abolition of the bacon tariff. This, however, will not prevent the British Government, in fixing pig prices at the Annual Review, from taking into account changes of cost and other relevant factors.How can both these groups of people be satisfied? The Minister is uttering a nice tale to the Danes and an entirely different one to the pig industry in this country. There is one soporific for the Danes, and another for the pig producers here.
§ Mr. J. Hare
The same sentiments are expressed in the document agreed between us which says:United Kingdom Ministers reserved their right to determine annually the guaranteed prices for pigs, with due regard inter alia to changes in costs.That was agreed with the Danes.
§ Mr. Champion
Yes, I read all that, of course, before I prepared my speech, but I ask the right hon. Gentleman how he can bring these two into unity and into a whole. How can he give these promises and carry them out in the circumstances now developing?
The Government seem to have no idea of what the effect of their actions will be. The Chancellor does not know, or so he said in the House on 9th July:One cannot say what the consequences of a reduction in tariff would be. What is certain is that the Exchequer will lose £6½ million, but it is impossible to say at this stage whether the effect will be that the Danish importers will secure a higher price for the quantity they at present import or will obtain a figure volume at a lower price."—[OFFICIAL REPORT, 9th July, 1959; Vol. 608, c. 1572.]1130 The right hon. Gentleman went on to try to assure pig producers that the market for bacon and ham is a nice elastic thing, but the producers who really know something about this industry say that statistical analysis over the last two years confirms that the demand for bacon has been relatively inelastic. I prefer to accept the opinion of the knowledgeable members of the Pigs Committee of the National Farmers' Union to that of the Chancellor of the Exchequer.
In these circumstances, is it any wonder that producers are bewildered and frightened when they are faced with conflicting statements by the Government? I have read them all, and I must say that the most honest one of the lot has been that made by the Lord Privy Seal. Whatever the Minister of Agriculture might say about the fact that he was discussing the £6½ million, he was doing nothing of the sort. If hon. Members will read his reply to the question in the context of that question, they will see that he was talking about the anxiety which would be brought to the industry itself.
I am sorry that I have had to speak with such speed on a matter of such vital importance. I promised the Joint Parliamentary Secretary to sit down in ten minutes, I hope I have carried out my promise, but I believe, Sir Gordon, that this industry has had a shocking deal from the Government.
§ 6.20 p.m.
§ The Joint Parliamentary Secretary to the Ministry of Agriculture, Fisheries and Food (Mr. J. B. Godber)
I am glad to have an opportunity of replying to the debate, if only briefly, and I say at once how sorry I am that some of my hon. Friends who wished to take part in the debate have not been able to do so.
§ Mr. Godber
I will start, as did my right hon. Friend, by paying my own tribute to the right hon. Member for Don Valley (Mr. T. Williams). I am sure he does not wish me to elaborate that, but it is none the less sincere. As to the rest of the debate, I do not propose to deal further with the hon. Member for Sunderland, North (Mr. Willey). I think we can leave him to stew in his 1131 own juice since my right hon. Friend dealt with him earlier today.
I shall seek to deal with one or two of the other interventions. First, I will deal with the hon. Member for Derbyshire, South-East (Mr. Champion), who has been seeking to wind up the debate for the Opposition. The hon. Gentleman took the opportunity of quoting several extracts. I was rather surprised at his audacity, I might almost say his daring, in quoting from the debate of 19th July, 1956, in which he participated. I was sorry that the hon. Gentleman did not remind us of some of the things he said. I know he is a bashful man, so I will quote briefly one thing he said. I wish I had time to quote more. Just before he sat down the hon. Gentleman said that subsequent to the tariff going on, prices had fallen away. The hon. Gentleman quoted prices for bacon which had dropped sharply shortly afterwards. Therefore, it is interesting to see that in the debate he said:Certainly, no advantage will accrue to the farmer to compensate in any way for the fact that by this Order the Government are tonight adding another item to the list of foods the prices of which have been deliberately raised this year by this Government.That does not tie up with what he was saying a few minutes ago about the price having fallen heavily. He said earlier:I disagree entirely … that there might be a compensating advantage to the British pig producer. I cannot see that anything of the sort is likely to happen."—[OFFICIAL REPORT, 19th July, 1956; Vol. 556, c. 1538.]If hon. Gentlemen really feel that, why should they be fussed about the removal of the tariff? There are other gems, but I have not time to quote them.
This debate has suffered from the difficulty that there are two items here which have become interwoven. On the one hand, there is the question of the level of profitability of pig production in this country; on the other hand, there is the Danish Agreement. That agreement cannot in any way be held to be responsible for any of the criticisms that have been raised about the present position of the pig industry. If hon. Gentlemen opposite felt so strongly about its position, why did they not initiate a debate immediately after the Price Review?
§ Mr. Godber
No, it is true. If, in fact, they had any feelings of that kind, they would have done so. As the Committee will realise, hon. Gentlemen opposite are trying to mingle the two things, and they are trying to cash in on the feeling of discontent which they feel might be built up among farmers as a result of the agreement. They do not want to appear to be opposed wholly to an agreement which I think they realise in their hearts must be for the good of the country as a whole, but they are trying to mingle the two things which, however, are separate and distinct.
Our views on the position of the pig industry have been made abundantly clear over the last few years in our Price Review White Papers. They were set out clearly in the 1958 White Paper and again in the 1959 White Paper. In the former, because we were faced with a heavy increase in production, we said that production must be reduced and we reduced the guaranteed price accordingly. In this year's White Paper we said that there must be a continued reduction in the cost of the production of pig meat and that further efforts to satisfy the market requirements were necessary. We have been absolutely clear in the advice we have given to producers on the production of pigs, and we have tried, as far as we can, to even out variations. However, as my hon. Friend the Member for Newbury (Sir A. Hurd) rightly said, there is bound to be a certain amount of variation in a commodity of this kind where it is so easy to go in and out of production.
The hon. Member for Deptford (Sir L. Plummer) asked me a question in relation to the back length of pigs. He seemed aggrieved that his own percent age of these high grade pigs was not high. He asked what were the figures—
§ Sir L. Plummer
My own figures are over 80 per cent., which are way above the average. I am not worried for myself but for other farmers.
§ Mr. Godber
I congratulate the hon. Gentleman. I thought he was complaining of his own figures, because he said he produced his own pigs. However, I am glad that he has been able to make clear his pre-eminent position in the pig world.
1133 As regards the national figures, the latest one I have been able to get is for the week commencing 15th June, when over 50 per cent. were in the A.A. grade, which is satisfactory. Although not up to the hon. Gentleman's level, it is not an unreasonable figure. It is an indication that the introduction of these high quality premiums has had a marked effect on the production trends of bacon pigs in this country. However, this is a matter which the P.I.D.A. is looking at all the time and there are no hard and fast views on it.
§ Commander Maitland
Can my hon. Friend assure us that it is not the intention of the Government to stabilise the national pig herds or the pig population at the present level, but that it is their intention to endeavour to have a larger pig herd than we have at present?
§ Mr. Godber
If my hon. and gallant Friend will study what my right hon. Friend said in his speech this afternoon I think he will find that the position has been made abundantly clear. I am sure that my right hon. Friend's statement that the guaranteed price will not be reduced at the next Price Review will have its effect in restoring confidence in the industry.
In relation to the Danish Agreement and to the abolition of the duty on bacon, it is fair to remember that it was not only hon. Gentlemen opposite who placed little value on it when it was introduced in 1956. It is worth recalling what the National Farmers' Union said on 28th February, 1956, after the announcement of the imposition of the duty. It was as follows:It is impossible to say whether or to what extent consumer prices of bacon will rise as a result of the imposition of an import duty of 10 per cent. The duty can however, have no direct effect on the price guaranteed to producers, which is determined annually in the light of the price review.That was the view of the N.F.U. at that time, and that is the view of the Gov- 1134 ernment at this time. There is no difference. If those arguments were correct when the duty was imposed, they are equally correct when it is removed.
There were many other matters raised by hon. Members which I would wish to have dealt with, but the time is very limited. I will conclude by saying that the debate will, I believe, prove useful, short though it has been, in that it has cleared the air and because it will be shown how groundless are the fears expressed about the future of pig production in this country. [HON. MEMBERS: "Oh."] If hon. Gentlemen opposite seek to stimulate those fears and to profit by them, they are doing a great disservice to the industry. Certainly it has been shown convincingly that the Agreement with Denmark has in no way reduced the profitability of pig production in this country, nor will it have such an effect. The successful conclusion of a Free Trade Area of the Seven countries will bring benefits to the community as a whole, and it is the community as a whole who, as taxpayers, will foot the bill for the agreement.
Farmers can, therefore, go forward with confidence that the guarantees they enjoy for pigs, as for other commodities, are still fully effective and have been reinforced by the very important statement made by my right hon. Friend this afternoon. The guarantees provided under the 1947 and 1957 Agriculture Acts remain their real safeguard. Farmers will see through the bogus concern shown by hon. Members opposite today, and will realise where their true support lies.
§ Question put and agreed to.
That a sum, not exceeding £165,518,079, be granted to Her Majesty, to complete the sum necessary to defray the charge which will come in course of payment during the year ending on the 31st day of March, 1960, for expenditure in respect of the Services included in the Civil Estimates.