HC Deb 29 May 1963 vol 678 cc1333-92

4.2 p.m.

Mr. Speaker

Before I call the hon. and gallant Member for Eye (Sir H. Harrison) to move his Motion, it may be convenient to the House if I indicate that the Amendment to the Motion, in the name of the hon. Member for East Ham, South (Mr. Oram), at the end to add:

That this House welcomes the decision of Her Majesty's Government to use measures of control of certain imports of foodstuffs as a means of stabilising the market for agricultural products in this country.
Although a back bencher may be fortunate in drawing first place to move a Motion from time to time on a Friday, it is only twice a year that he can be fortunate enough, by choosing a lucky number, to open a debate at 3.30 p.m. [HON. MEMBERS "Four o'clock." When this good fortune happened to me on 14th May I had no doubt that the right subject for me to raise, both in the national interest and in the interests of the agricultural industry, in which so many of my constituents are engaged, was one dealing with the necessity for a greater control of the imports of foodstuffs. This was a Motion calling for a big change in Government policy.

It must be unique in the annals of this House that I should have received a reply to my Motion and, what is more, have had it accepted in principle by the Minister of Agriculture a week before I was able to move it. This was due to the fact that the Opposition, at short notice, took a Supply day to debate agriculture—an opportunity which they had had for many weeks. I tried to discover whether a back bencher was in any way protected by the law of anticipation but, searching through Erskine May, I found, according to pages 403 and 404, that once more the powers of the Front Benches were too strong, and that as the debate was on a Supply day, in Committee, it had priority over mine.

However, no vote was taken last week on the control of imports. Therefore I have extended my Motion to cover a wider field than it covered originally, because I wanted it to be carried and recorded that this House approves the new policy announced by Her Majesty's Government last week. In my view, in spite of last week's welcome announce- provided that domestic consumers are not prevented from obtaining reasonable price advantages from the increasing productivity and abundance of agriculture at home and overseas, and provided also that overseas primary producers are not deprived unduly of the means of paying for British industrial goods is not selected.

Colonel Sir Harwood Harrison (Eye)

I beg to move, ment, this debate is still opportune, since it enables us to discuss some of the detail which was, naturally, omitted last week.

I am delighted to know that my right Friend the President of the Board of Trade will be taking part in the debate, because much of the detailed administration of these controls will lie in the hands of his Department. He is often regarded in agricultural circles as the nigger in the woodpile, but I wish that some of my agricultural friends could see how clean and charming a person he is in the flesh. I suggest that he soon speaks to a large gathering of farmers. If he finds that leaders in other industries and businesses try to stop him carrying out this policy, I suggest that he consults his Parliamentary Private Secretary, my hon. Friend the Member for Lowestoft (Mr. Prior). If he follows his advice on farming matters he will be very wise.

The reason that I have chosen this subject for debate is that for some months it has been clear to me that in the interests of our farming community—which wants stable prices—and certainly in the interests of the consumer, or taxpayer, there must be some control on the excessive import of foodstuffs.

When the 1947 Act was passed—and, to a lesser degree, the 1957 Act—we still needed a large quantity of food from the Commonwealth and foreign countries, many of whom were then short of food themselves. The world situation is very different today. There are large surpluses in many countries. We are one of the last free markets left, and it is not unnatural that countries should look to see what they can unload on us. It is that extra amount that is coming on to our market that has upset both supplies from home producers and also prices.

At the end of last year I met the leaders of the Suffolk Branch of the National Farmers' Union and told them that I, at least, was converted—as I thought many of my hon. Friends were —to the necessity of a policy of import control. At that time the Government were still negotiating in an endeavour to enter the Common Market. It may be argued that they were not at that time paying sufficient attention to the needs of our farmers. Grave concern for the future has been expressed during the year, but the quick change of policy announced last week should restore confidence. Farmers were, naturally, angry at the increase in beef imports, which forced down the prices of the home product, although they were still getting the benefit of the guarantee under the 1957 Act.

It appeared that the Government were reacting slowly. It must be realised that in a democracy it is usually natural for a Government to react slowly, until public opinion is expressed. Farmers are critical of the dumping of foreign produce at low prices, and although the antidumping legislation has achieved much, its machinery is cumbersome. Often the threat of its use has been successful in preventing imports, but this is negative.

Farmers were shaken when it looked at one time as though a contract for the supply of liquid milk to an American air base in East Anglia would go to a Dutch firm. We have consistently had imports of Polish eggs at inopportune moments, and there is a strong feeling that the Danes are getting more than their fair share of the bacon market. While the farmers' price is controlled, to a large degree, any extra costs incurred by the middleman are automatically passed on to the consumer. A few days ago the cost of producing bread rose. It may have been due to a wage increase, or to extra overheads, but at any rate the price of bread was increased, and the farmer felt that he was getting the blame, although he was getting no benefit.

Yet in all the post-war years no industry has increased its productivity more and absorbed more new ideas and techniques, although at the same time—as my hon. Friend the Member for Newbury (Sir A. Hurd) pointed out last week—the numbers of farmers and farm workers have decreased. It was for these reasons, for which the Government must accept some measure of responsibility, that I expected, a fortnight ago, to be moving a narrower Motion this afternoon, calling for immediate action. Thus, I was delighted to find that my right hon. Friend the Minister of Agriculture had quickly persuaded the Cabinet to agree to a policy of import control. That is why my Motion is framed as it is.

No doubt the one Liberal Member sitting opposite at the moment may not like the Motion, since Liberals seem to prefer the importation of overseas food free of duty.

Mr. Jeremy Thorpe (Devon, North)

The hon. and gallant Member had better read our policy.

Sir H. Harrison

The hon. Member had better consult his grandmother, Lady Violet, and find out what she thinks. Those who do not like support prices are free to vote against the Motion.

I want to raise a few points concerning the detail of the way in which import controls might work. First, I want to consider a commodity of which we produce all that we require, such as milk. Can we have an assurance that under no circumstances will the import of liquid milk be allowed?

When we think of milk, we think of beef, and here the Government for some time now have given great encouragement to farmers to reduce their dairy herds and to go in for beef. That policy has been quite successful. That is why everyone was upset at what happened at the beginning of this year, because it was clear that if we were producing more at home we must have a restriction on imports. During the first three months of this year, there was a big increase in imports from the Argentine. They were nearly doubled. I am glad that my right hon. Friend has been able to make a temporary and voluntary agreement to the end of the year. But I do not think that this is enough. This is a case in which immediate action is required.

We also see that although the production of home bacon was up by 10 per cent. in 1962 over 1961 imports, also, were higher. There is some concern among pig farmers at the cutting back in the standard number of pigs in the Price Review this year to 11 million. I must express the hope that when working out import controls for this commodity the Minister will allow the industry to keep the expansion of 12 million reached last year, and of which it shows that it is capable.

We see a continuing increase in the home production of cereals, especially in barley. If standard quantities are to be imposed, I hope that my right hon. Friend will take account of the fact that owing to scientific research in which the Government play a very great part, and the ability of our farmers, more is continually being produced per acre. Will my right hon. Friend therefore consider making his standards on an acreage rather than on a tonnage basis? We have had Questions recently in the House about the relative merits of maize and barley. There is no doubt that in balanced rations there could be a good deal of substitution of one for the other. I know something about this, because far some years I was actively engaged as a corn merchant.

If we are to protect the home producers of barley, there may have to be control over imports of maize, although maize is not produced in this country. Home-produced barley was up by 14 million tons in 1962 over 1959 and imports dropped by 650,000 tons. We see that the maize imports were up nearly 50 per cent. in 1962 over 1961. This was partially due to the late harvest here, and I am glad to notice the big fall in the imports of maize for the first quarter of this year. It is interesting to recall that two-thirds of the maize we import comes from the United States, a highly industrialised country, and not from one of the poorer, underdeveloped countries. Here, perhaps, is a commodity to which my hon. Friend might give attention.

We see a fantastic rise in the price of world sugar. I underline the word "world", particularly in view of my right hon. Friend's replies to Questions asked earlier this afternoon. I believe that this should be a warning to the people of this country. We have been severely rationed in the acreage of sugar beet for many years, and when the sources of supply from overseas become very expensive, surely we must look again at the position. This must be a long-term plan, as the planting season for this year is over and we cannot get an increase in home production until the winter of 1964. I hope that there will be no rigid impositions, because I believe that this could be an opportunity, if cereals are to be restricted, where we could, and with advantage, well increase our acreage of sugar beet.

I do not wish to lay down exact details, regarding restriction, or go into the question of whether quota or specific or ad valorem duty would be best, or the right method for the control of imports. My own feeling is that each commodity must be dealt with on its merits. What might suit one may not suit another. I would, however, stress that timing is very important and that it may be necessary to have prohibition of entry at certain times of the year. We can, of course, think of grain at harvest time. Some people believe that what may be required is either a commission or an authority under the Ministers, armed with flexible powers which might be used very quickly.

This, of course, could apply both ways. When adverse conditions arose duties could be removed for a period, as was done regarding foreign vegetables in the spring of this year, when we were short of home-produced vegetables owing to the prolonged frost.

For many years I have firmly believed that the consumer likes stable prices. Nothing upsets a housewife more than when prices either rocket up or down—[Laughter.] That is perfectly true—and she has to rearrange her budget. By this new system, wisely administered, we shall get stable prices which will be to the great benefit of the consumer.

We also want to maintain an expanding market for our home production. The importance of this has been referred to in the Report of the National Economic Development Council and last week my right hon. Friend talked of the expanding population. I presume he means that home production will get its full share.

There have been two most interesting articles recently, one as late as last Sunday in the Sunday Times by Mr. William Rees-Mogg. He was not writing as a farmer on behalf of the farming industry. He is described as the political and economic—I stress the word "economic"—editor of the Sunday Times.

I should like to quote a paragraph to support my case: It should in any case be remembered that in the last seven years British farming has raised its production faster than British industry. In productivity per man and in cost of many commodities it is strictly competitive with the protected agricultures of the major European producers. In Britain, each farm worker produces enough food a year to feed 30 people—in Russia, each farm worker feeds only five people. In addition, Britain's net farming income has fallen in terms of constant purchasing power in the last 10 years.…It is necessary to consider these matters in some precise detail, for, in fact, British agriculture has made a better proportionate contribution to our balance of payments in the last 10 years than British industry—which is itself highly protected. The expansion of British farming, and its rapid improvement in productivity, has been a national asset. That is strong language and I think that it supports my case.

In applying controls we must be careful that we do not drive up the price of the foreign foodstuffs coming into this country beyond a reasonable level. We are prepared to pay a fair price, particularly for goods which come from the Commonwealth countries. One of the great reasons advanced for us having had a free market has been that we are a great trading nation and that it has helped our export trade, to which my right hon. Friend has made such a valuable contribution. But I believe that our exports are so strong today that even if we send less goods to countries like Poland and the Argentine our balance of payments position will be much stronger by getting maximum home production.

It is said that only 4 per cent. of our population are engaged in agriculture. This may well be true, but there are many people in allied trades who depend for their living and their home market on the prosperity of agriculture, and I believe that all history shows that a nation without sound agriculture goes down hill. Can we be sure, for example, that we could export as many tractors as we are exporting today if we did not have a flourishing farming countryside?

On 2nd May we debated an Order dealing with the guaranteed price of shell eggs and with egg imports. I spoke very critically then of the policy of allow- ing imports of eggs at all and I forced the matter to the point of a Division being called. I do not think that that was exactly popular with my former colleagues in the Whip's Office, but at least a gamekeeper who has turned poacher knows the rules, and I had given full notice of what I intended to do.

Why do I feel so passionately that we must have a prosperous agricultural industry? It is because of my own personal experiences. I remember, as a small boy of 5 or 6 years of age, being out with an uncle of mine one day when, walking along a footpath, we met a very old man, or at least he appeared to be very old. He looked like Methuselah. He was bent double and had a long white beard. In those days, the value of money was great. My uncle said, "Well, John Jeyes, what would you do if somebody left you £100?" The old man scratched his head and thought a moment and then said, "Well, sir, I would do my innards well." In the arrogance of youth, I thought, "What a silly old man. I should buy lots of games." It was much later when I was a prisoner of war that I realised the old man's wisdom, because unless men and women, in his words, "do their innards well" they can achieve nothing at all.

Twice in our lifetime we have seen this nation threatened because it could not feed itself. We hope and pray that there may never be another war, but there are other things, such as world famine or a rapid increase in world population, which could cause a shortage of food for us. It is surely a sound insurance policy that we should produce a high proportion of our food in this country. The changing fashion in consumption must be borne in mind. In an affluent society people no longer have bread, oatmeal, herrings and potatoes as their main staple diet. They are moving to eating less carbohydrates and more of the enjoyable protein foods and fruit and vegetables.

It must be realised that in administering import controls for the future, having seen what can be produced here, we must allot the balance for the Commonwealth countries and the rest of the world. I ask the Government to set the target for the home producer a little on the high side, because it is easy to allow extra supplies to come in from outside if required but it is so fatal to our own supplies and prices if in a good year we give too big a share to the exporting countries.

I should like to direct the attention of the House, Government Departments, the National Farmers' Union, and the National Union of Farmworkers to the whole problem of the distribution of agricultural products. We must move forward into the more streamlined age. It may mean that more marketing boards are required, but, apart from that, the process of marketing is still old-fashioned from the farm to the consumer. Too many people are involved in giving a service.

In some ways the consumer likes this personal service, but it involves high prices. For example, in these days, when more and more of the population have, and ultimately all the population will have, refrigerators in their homes, is a seven-day delivery of milk really necessary? Could there not be some inducement by price for people to have a delivery perhaps only twice a week?

The advent of the supermarket and the help-yourself stores may help to bring down distribution costs. I am sure that this development would yield in agriculture and in many other industries rich dividends to the nation if it were thoroughly examined and explored. This could help the farmer to obtain a higher price for his product and possibly lead to a lower price to the housewife.

I hope that as a result of this new policy there will be a greater feeling on the part of the Government, as they have already shown, of obligation and responsibility to the agricultural industry, and a much finer spirit of partnership between the Government, the farmer and the consumer. We have never previously had a finer entry of young farmers than we have at present. Many of these trained and qualified at their own expense, which is not usual among young men and women in other professions. We must see that they have ample opportunity to play their part, using all the new modern, scientific methods on our farms. They must feel that they, too, are in an expanding industry in modern Britain and making a great contribution to the whole economy of the country. I commend the Motion to the House.

4.26 p.m.

Mr. Charles Royle (Salford, West)

I am sure that the House will join with me in congratulating the hon. and gallant Member for Eye (Sir Harwood Harrison) on his good fortune in the Ballot and on his choice of subject, but when I tell the hon. and gallant Member that there is not a farmer in my constituency, he will not be surprised if I take a view of this subject entirely different from his.

I regard the debate as an extension not only of the announcement which the Minister of Agriculture, Fisheries and Food made last week, but also of the debate two days previously, on consumer protection. Therefore, what I have to say on the Motion will be concerned with aspects of consumer protection as far as they apply to import policy quite as much as to agricultural matters.

The House perhaps will not be surprised if I concentrate on one commodity--meat. It is not a bad idea from time to time in the House if we speak on things we know something about. If we all tried to concentrate our speeches in that way the time occupied by many of our debates would be considerably shortened.

The hon. Member and his friends in agriculture were encouraged by the speech of the Minister of Agriculture and the proposals which, as far as he could go, the right hon. Gentleman outlined last week. But, while they were encouraged, they were apparently not satisfied, and the hon. and gallant Member now continues the pressure purposely to keep his right hon. Friend up to scratch. I do not want to be unfair, but I regard the hon. and gallant Member's attitude as representing a very selfish outlook on the part of the farming lobby. In his speech he made only one reference to the consumer and that reference was to the stability of prices, without any regard to their level, and to how and at what price essential food supplies could be obtained.

The hon. and gallant Gentleman does not appear to be concerned about the 50 million consumers of the country. His attitude throughout seems to be that the agricultural community must be all right and that it does not matter very much about anybody else.

Sir H. Harrison

I did not want to give that impression. I had to keep my speech short, since the debate itself is to be short. I wanted to underline that if we do not have a sound agricultural policy our 50 million consumers will be at the mercy of foreign producers.

Mr. Royle

I am in some agreement with the hon. and gallant Gentleman there. I am not saying that there should not be a prosperous agricultural community. My concern is with how this is to be brought about. The hon. and gallant Gentleman and his friends seem conveniently to forget that, in the hardest winter we have had for over eighty years, with nearly 1 million people unemployed and millions more on short time, cheap meat from abroad, resulting in cheaper home-produced meat, was a veritable boon.

I suppose that the Minister's announcement last Wednesday is to be the blueprint of a new approach to farm subsidies, imports and prices. In other words, presumably it is to be the beginning of a new era. I think that all of us have smelt it coming. in the light of the Press interviews, the failure of the Common Market negotiations, the G.A.T.T. conference, the E.F.T.A. meeting and Tory agitation.

We have no details about what is to happen, only a bald statement. It will take months to work out the details. I hope that by that time another Government will be in office which will look at the problem from the point of view of the country as a whole instead of from the point of view of one section. Certainly, the consumer interest must be paramount.

Traditionally, we have offered a free market for food, and the result has been an abundance and a variety and a low cost unequalled in the world. Imported meat is vital to the task of feeding Britain. I do not want to weary the House. I have only a few figures. I take the three years 1938, 1957 and 1962. I chose those years as examples for a specific reason. The last full year before the outbreak of war was 1938, while 1957 was the year when we were begin- ning to get away from shortages, and 1962 is the most recent full year.

The consumption per head of beef in 1938 was 55 lb.; in 1957, it was 54 lb.; and in 1962 it was 51 lb. In 1938, the consumption of mutton and lamb per head was 25 lb.; in 1957, it was 22 lb.; and last year it was 25 lb. So, in meat, we are worse fed than we were in 1938. How were these supplies made up?

Mr. Percy Browne (Torrington)

If the hon. Gentleman is to quote figures for meat, he should also include chicken consumption.

Mr. Royie

I agree that there has been some shifting of public demand to poultry. I must say that I never thought, as a butcher, that I would ever see the day when meat was dearer than chicken.

Mr. Browne

The hon. Gentleman said that we were eating less meat. If he adds chicken meat, he will find that his assumption is wrong.

Mr. Royle

The hon. Gentleman will recall that I did not quote pork consumption, either. I was using the word "meat" in relation to beef, mutton and lamb.

In 1938, the home supply of beef totalled 51 per cent. and the imported totalled 49 per cent.; in 1957, the home production had risen to 64 per cent. as against 36 per cent. imported; last year the figure had improved to 73 per cent. home production compared with 27 per cent. imported. In the case of mutton and lamb, the 1938 home production figure was 38 per cent., in 1957 it was 37 per cent.; and in 1962. 42 per cent.

The question I would put to the Minister and to his right hon. and hon. Friends is this: do these figures show an improvement of home effort commensurate with the thousands of millions of pounds in deficiency payments that have been poured out, particularly for mutton and lamb? It must not be forgotten that the milk scheme—which, as the hon. and gallant Member suggests, has been declining to the advantage of beef production—has in the past—and, to some extent, the present—accounted for the beef increase.

It is not the best beef imaginable when we get it, but it is included in the figures of home production. Those of us with experience of this know that, when a beast has had three or four calves, it does not produce very good beef. Self-respecting butchers do not often look at that kind of cattle.

Dr. Barnett Stross (Stoke-on-Trent, Central)

I have listened with fascination to my hon. Friend. Is he saying that the amount of meat we eat is an indication of the well-being of the nation as a whole? Did he not note with what scorn the hon. and gallant Member for Eye (Sir H. Harrison) spoke of an impoverished diet of bread, potatoes, oatmeal and herring—a diet which produced the strongest and healthiest peasantry in Europe?

Mr. Royle

I always bow to the superior knowledge of my hon. Friend the Member for Stoke-on-Trent, Central (Dr. Stross) in matters of this kind, but the House will expect me to regard beef, mutton and lamb as the very basis of our health. My hon. Friend can have these other things. They are all his. I still want my rump steak on my plate. He can have his choice.

However, I want to leave that particular point, because there are other aspects to this matter. It would seem, according to the hon. and gallant Member for Eye, that it is only incidental that we cannot sell our goods abroad if we do not buy from abroad. But I should have thought that that was elementary in every economic argument. The best example is the protest which, I understand, has already come from New Zealand about the Minister's proposals.

Let us face the stark fact that our farmers can never provide all the meat required by the public at a price which will keep it on the menu consistent with our standard of living. The scheme under which support payments are made has worked badly in short-term periods of both surpluses and shortages, by failing to discourage additional marketing when the market is overloaded and failing to encourage greater supplies when there are shortages. But the long term is separate in its effects on existing home production.

This expansion of home production has been encouraged, I suggest, without any serious assessment of economic justification from a national standpoint. The total Exchequer cost has risen because each additional unit has been subsidised at the same rate. The consumer has not benefited from increased quantities or lower prices, because a fairly constant supply has been redivided to the advantage of home producers.

It is impossible to judge the full implications of the new arrangements announced last week until we know some other things about them. First, what will be the level of imports under the commodity agreements? Secondly, what minimum import prices are in mind? Thirdly, what will be the level of standard quantities, and how will they be determined? Finally, what will be the total subsidy the Government are prepared to make?

It seems clear to me that the consumer will pay more on two counts: first, through some of the burden of the higher proportion of high-cost home production; and, secondly, by higher prices for the same quantities of imported meat. In passing, it is interesting to note that during 1962 Argentine chilled meat was always from Id. to 5d. a lb. below the price of home-killed beef, but in May of this year—this very month—the differential has completely vanished.

Parliament has always recognised the importance of a prosperous agricultural community. Here I agree with the hon. and gallant Gentleman. Parliament has not been ungenerous. I am old enough in the service of the House to have been a member of the Standing Committee which discussed the 1947 Act. All of us in those days were very anxious to do all we could, remembering the magnificent service which the agricultural community had rendered the nation during the difficult years of war. We did them pretty well in the 1947 Act, passed by the Labour Government.

The February Reviews every year are worked out between the Minister and the National Farmers' Union, and shortfalls of guaranteed prices have been met by enormous subsidies. On a short market the Exchequer sits pretty on high prices. On a fuller market the Exchequer gets very anxious and, as in 1961, shows signs of hysteria. The meat trade became the whipping boy of the Minister of Agriculture on purpose to cover up his own bad arithmetic. That bad arithmetic has shown itself for a long time in these: matters.

I strongly hold the view that a scheme devised in days of shortage must creak in days of plenty. That is what is happening. Four hundred million pounds in producer support is a haunting thing in days of plenty. So, with the fear of reduced subsidies, come the pressures on the Minister once more from his back benchers for unilateral action against imports. Now we get the suggestions of limiting and regulating imports. The hon. and gallant Gentleman is not satisfied with that. He calls attention, in his Motion, to the need for greater control of foreign food imports. Deficiency payments are to go on, to be adapted, to quote the Minister, to present circumstances by bringing about greater market stability"— along with— …a system of control of imports or import prices, combined with the extension at home of the standard quantity concept…"—[OFFICIAL REPORT, 22nd May, 1963; Vol. 678, c. 446] What does that mean? I make my own interpretation of it. I say that it means we are heading far a policy of dearer food. The Minister said that he was not intending to restrict supplies or to raise market prices. After years in the meat trade, I cannot see any other consequence of lowered supplies unless demand falls away. In line, demand will fall away with increased prices.

Mr. P. Browne

The hon. Gentleman has great knowledge of the meat trade. May I ask him whether he thinks that the marketing of meat is satisfactory in this country? Does he think that the butchers have always been very fair in the prices that they have quoted?

Mr. Royle

The butchers have always been fair, but distribution and marketing need some improvement. Five hundred delegates at the meat trade conference at Easter unanimously endorsed the view that any restriction on imports can only be to the detriment of consumer interests and taxpayers' pockets. They are the ones—let it be said quite clearly—who have to meet the housewife.

In passing, I wonder what the Minister is doing in consultation with the distributive trades on the matters we are discussing. My hon. Friend the Member for Workington (Mr. Peart) mentioned it in the debate last week. It is all very well for these consultations to take place with the agricultural interests all the time, but other people have to get food to the consumer. I think that they ought to be consulted.

To sum up, the Minister has decided that meat is too cheap. I am sure of that. It is costing too much in subsidies. However, his farmers want their pound of flesh. They say that the answer is to reduce imports. By so doing the Government will shock the overseas suppliers whom we might need again some day. They push the bill on to the consumer. The Tories have lost elections before today on this issue, and they will lose again. Only a planned marketing and distribution policy—the hon. Member for Torrington (Mr. P. Browne) will be glad to hear me say this—will give the population what they deserve in price, quantity and quality.

The ideas of the hon. Member for Torrington may be very different from mine, but he will be surprised to know how far I am prepared to go with him on that question. In the rush which is now going on to manage the market and retain the farming vote, the housewife can well do with some champions of her cause. I want to be counted as one of them.

4.48 p.m.

Mr. R. H. Turton (Thirsk and Malton)

First, I want to congratulate my hon. and gallant Friend the Member for Eye (Sir H. Harrison) on putting the case so very clearly and effectively when he moved the Motion. I congratulate him on his good fortune in winning the Ballot and choosing this subject.

I thought that the speech of the hon. Member for Salford, West (Mr. C. Royle) was extremely valuable, because I think that it gives us the line that the party opposite will take on this question of an agricultural policy. I cannot believe that the party opposite is as divided on this subject as it is on every other subject.

Mr. C. Royle

This is a private Members' debate. I speak as a private Member.

Mr. Turton

I gather, therefore, that this is a private quarrel. What we want to find out is the view, not only of the country, not only of the Conservative Party, but of the other two parties on what I consider to be the landmark in agricultural policy announced by my right hon. Friend the Minister of Agriculture, Fisheries and Food last Wednesday. To me, it was common sense, and I hope that although this is a private Members' debate, whoever winds up for the Opposition will make quite clear what the Labour Party's view is on this question of the change in agricultural policy.

It is not possible to work a system of guaranteed prices in a time of over-supply unless there is a measure of control on imports. It is true that in 1947, when there was scarcity, it was possible to work a guaranteed price system, for the market was assured at the same time, but now that we have over-supply, and have had for some time, we must have some measure of control in the interests of the taxpayer, in the interests of the producer, and in the interests of the consumer, about whom the hon. Member for Salford, West, was talking.

The hon. Gentleman rejected my right hon. Friend's arithmetic. I find myself unable to follow the statistics given by the hon. Gentleman, for they have no relation to the actual facts. The hon. Gentleman did not quote his source, so when I quote figures I shall give my source, and we can then judge whether they are right.

Mr. C. Royle

I did give the source.

Mr. Turton

The hon. Gentleman will no doubt be able to put that in the papers afterwards, but he did not give it in his speech. I do not mean that he will be able to put it in HANSARD; he will be able to write to the Daily Herald, explaining why he was more accurate than he appeared to be.

Before the war we produced 24 million cwt. of meat and imported 29 million cwt. This information is derived from the Ministry of Agriculture, Fisheries and Food's annual review figures and the Trade and Navigation Accounts. That means that 53 million cwt. of meat were available before the war. That was not in 1938, when, as the hon. Member for Salford, West knows, there was a certain amount of stocking-up going on. I have given the 1936 figure, and the figure for 1937 was much the same. In 1962, we imported 28½ million cwt. and produced 39½ million cwt., making a total of 68 million cwt. There has been a change in supply in this country to the extent of 15 million cwt. extra. which has made the position more delicate for the working of the guaranteed system, and also more delicate for the President of the Board of Trade when he is dealing with other countries.

The position with regard to wheat is similar. Before the war we imported 100 million cwt. and produced 33 million cwt., making a total of 133 million cwt. We now import 78 million cwt. and produce 72 million cwt. making a total of 150 million cwt. We are getting a good deal more wheat into this country, and this makes the position very difficult for the wheat farmer in this country.

The position in respect of barley is even more acute. Before the war we imported 18 million cwt. and produced 15 million cwt., making a total of 33 million cwt. Our imports now are down to 7 million cwt. but we produced 115 million cwt., making 122 million cwt. available. I quote those figures merely to show that the whole picture of supply has changed tremendously, especially recently when we have had this revolution in agriculture.

That this does not work with the present guaranteed supply system I can illustrate best by looking at the picture of egg production, where at the moment we are virtually self-sufficient in the supply of eggs. Last year we had a guaranteed price of 3s. 8d. a dozen eggs, yet we imported 2½ million cwt. of eggs at an average price of 2s. 5d. a dozen, together with £300,000 worth of liquid eggs which caused great damage to the health of my constituents and many others by giving them paratyphoid. These eggs were imported at an average price of 2s. ld. per lb. This so upset the guaranteed price system for eggs in this country that the taxpayer had to pay £24½ million in subsidy. This is a ridiculous state of affairs, which I am certain the hon. Member for Salford, West, even in his private capacity, could not possibly defend. We paid £6½ million for eggs which we did not want, and, in addition, we saddled the taxpayer with a burden of £24½ million.

Mr. C. Royle

Who imported the eggs?

Mr. Turton

Many private sources who wanted them to try to get cheap materials for their manufactured products. I shall deal later with the arrangements we make with certain Iron Curtain countries, for which my right hon. Friend the President of the Board of Trade is responsible.

The system of over-supply does not work with the guaranteed price system, and the next thing at which one has to look is what should be the measure of control? The trouble is that not merely is there over-supply in quantity, but that some of these imports are coming in at exceptionally low prices as a result of what I call desperate dumping. Dealing again with meat, in the first three months of this year—and I call in aid the speech of the hon. Member for Salford, West—the position is that in December last year fat cattle were making about £7 10s. 0d. a cwt. By the end of March that figure had dropped to between £5 10s. 0d. and £5 15s. 0d. a cwt., a fall of between 20 and 25 per cent. Why was that?

The Argentine nearly doubled her exports to us in that period compared with the previous year, and Uruguay trebled her exports to us. The average price of Argentine meat that came in in December, 1962, was £9 12s. 0d. a cwt. The average price of Argentine meat that came in the first three months of this years was £7 10s. 0d. a cwt., a drop of over £2 a cwt.

Who benefited? The hon. Member for Salford, West gave his case away when he said that until the early part of the year there was a margin of Id. to 5d. per lb. on British beef over Argentine beef but that it disappeared by May. Of course it did, because by that time the market for meat had been so saturated that there was over-supply and it was not possible to get the preference that better meat really required.

If one looks at the Retail Price Index and compares the level of December with the level of April, one finds that the index for meat fell by 1 per cent. during that period, although the price of fat cattle fell by 25 per cent. Yet it was at the same level as it was in January, 1962, when the price of fat cattle was £8 a cwt. These quick fluctuations in price, this desperate dumping, does not help the consumer, although I quite agree that there may be some whom I would des- cribe as market operators who get some gain by it.

I hope that I shall convince the hon. Member for Salford, West and those who think like him that what the Government are doing is not merely in the interests of the farmer and the taxpayer, but also in the interests of the consumer. We want stable prices. We do not want wild fluctuations. A country which unloads products by excessive imports here is not doing us any good in our balance of payments.

What is to be the method of control? I am quite certain that we cannot deal with this matter solely from the point of view of quantity; we have also to deal with it from the point of view of price. My right hon. Friend the Minister of Agriculture, Fisheries and Food referred on Wednesday last to the working group on bilateral agreements. I entirely agree that we should be working through a system of bilateral agreements, but I hope that when he or the President of the Board of Trade carry out those agreements they will remember the Crathorne policy of agriculture in which Sir Thomas Dugdale, as he was when he was Minister, announced that he would so conduct his policy as to regard the interests of the home farmer first, the Commonwealth farmer second, and the foreigner third.

We now require an amendment to the Crathorne policy because, after we have looked after the interests of the home farmer and the Commonwealth farmer, we have to look after those of our E.F.T.A. partners in preference to the rest of the world. I hope that whoever answers this debate will make it clear that Her Majesty's Government still hold to that system of priorities.

Turning to what measure of price control we should have, we have to realise that if we are to continue, as I hope we shall, with the guaranteed price system we should be linking our system of import control with that system. We want to avoid imports which come in well below the price guaranteed in this country. I agree that no doubt we shall have to have different systems for different commodities. It makes a great difference whether what we are importing is a raw material for a home industry or a finished product, but generally we ought to have a system of tariffs which hinges on when the import price is 25 per cent. below the price guaranteed in this country. That is a more effective way of dealing with the problem of excessive imports than the anti-dumping legislation which Lord Eccles introduced a few years ago.

I do not believe that anti-dumping legislation is a satisfactory way of dealing with this matter because it is an insult to a friendly foreign country to call it a dumper. Those countries do not like it. What we can do to a friendly foreign country is to say that we have our system of guaranteed prices which is vital for our home agriculture, but it is equally vital for taxpayers and consumers that it should be operated economically. We should say, "We cannot stand your imports coming in at 30 per cent. or 40 per cent. below the guaranteed price level. Therefore, we shall put on a tariff which hinges at a fairly heavy rate the more that it goes beyond 25 per cent. below our guaranteed price."

I throw out that suggestion for consideration. It is not unlike the sluice gate price system of the European Economic Community. I do not think that the sluice gate system would work so well for us for there is a danger that the Community's system would raise prices unduly high, whereas a system of a hinging tariff would be more in favour of the consumer.

Coming to the problem of the measure of control, I wish to say a few words about standard quantities. My right hon. Friend the Minister has made it quite clear that he intends to introduce standard quantities for meat or cereals in a future Price Review. Reading what was said by the President of the National Farmers' Union only at the beginning of the month, I feel sure that if this system is worked out reasonably it will meet with the approval of the N.F.U. Mr. Woolley said: I believe that we, as farmers, must take a clear-sighted and balanced view. Obviously, those markets which can pay for produce must not be so flooded that prices fall to wholly uneconomic levels. Quite clearly, on the other hand, we cannot ask other nations to regulate their production and expect to be able to have a complete free-for-all for home production, whether or not we go through the economic ceiling. As I understand it, that statement by Mr. Woolley was showing that he is quite prepared to accept standard quantities in a future Price Review if there is a satisfactory measure of control, but I beg the Government so to work their standard quantities as to provide for the economic expansion of home agricultural industry. That is both in the interests of the balance of payments, and the interest of home agriculture.

I put it like that and expect to have an answer when the speakers from the Government and the Opposition Front Benches take part in the debate. I hope that each will give his comments on the different views of policy and prices, including those of the hon. Member for Salford, West. There must be economic expansion. We do not want uneconomic expansion in agriculture. I think that there is certainly in beef very good scope for great economic expansion with the development of recent years, both in barley-fed cattle and the rest.

Who is to carry out this measure of control? I alway fail to understand the departmental system of dealing with these questions of trade and imports. My right hon. Friend the Minister is responsible for the whole of the food of the country, whether it is grown here or imported. Yet he has little or no control over imports of food. That is handed over to my right hon. Friend the President of the Board of Trade, who, curiously enough, looks after trade with Commonwealth countries, while if it is a matter of trade with foreign countries it is handed over to the Foreign Office. That is true. The officers who deal with imports in respect of foreign countries are officers of the Foreign Office.

I believe that there is a strong case for so altering the position that when dealing with food imports the Minister responsible should be the Minister of Agriculture, because if he has a ministerial responsibility for food supplies he should decide the quantity which should be imported, naturally taking it as a Cabinet decision. This seems to me the more important because although, except for the hon. Member for Salford, West and one or two others, broadly speaking there is general agreement on the Government's policy for dealing with this problem, when we consider who should carry out the control there is considerably disagreement.

The official Opposition suggests a system of import boards. I understand that the hon. and learned Member for Montgomery (Mr. Hooson) wants a commission which would supplant all Government Departments; there would be a certain amount of bureaucracy doing what clearly should be the Government's function. If I am wrong about that, perhaps when the Liberal Party spokes man takes part in the debate he will make a little clearer what the hon. and learned Member intended.

I believe that the question of the control of imports must be in the hands of the Cabinet, the Government and a responsible Minister. In my view, it cannot be handed over to any board or commission although no doubt, just as before the war we had I.D.A.C., an advisory committee could well be appointed, on which I hope the hon. Member for Salford, West and the hon. Member for Workington (Mr. Peart) would work together in happy unison. That seems to me to be the right way, and I do not believe that it can be worked by my right hon. Friend the President of the Board of Trade.

This is not a personal attack on him. I know him to be well intentioned. But, unfortunately, his Department has been responsible for so many things in the past which have gone wrong in agriculture. For example, we have the whole of the Iron Curtain treaties, all the Yugoslav meat, all the Polish eggs—all coming in because, with his zeal for signing agreements to make trade with distant parts of the world, he is bringing in vast quantities of food which are an embarrassment to his neighbour and right hon. Friend the Minister of Agriculture.

I therefore hope, in supporting the Motion, that a measure of control is carried out by the man whom farmers respect and honour, my right hon. Friend the Minister of Agriculture.

5.14 p.m.

Mr. Jeremy Thorpe (Devon, North)

The right hon. Member for Thirsk and Malton (Mr. Turton) has, with his usual courtesy, raised certain queries about the Liberal Party's views and I hope later in my speech to answer them, perhaps not to his satisfaction, but at any rate sufficiently to show where we stand.

May I first congratulate the hon. and gallant Member for Eye (Sir H. Harri- son) on introducing this Motion. It is no criticism of him when I say that perhaps it would have been even more useful if we had been in a position to discuss the precise nature of the policies which the Government intend to implement. The fact that we do not know what they are is not in itself a criticism of the Government, because the decision to change the basis of our agricultural policy was announced only a few days ago.

May I introduce one slight jarring note? I am not certain whether the hon. and gallant Gentleman's reference to a certain lady was in the best taste, but he would do well to recollect that my party relies less on the leadership of grandparents than does his.

I find it very odd that there should be any doubt among intelligent hon. Members who attend agricultural debates assiduously—that is to say, when the Opposition provide a Supply day, as they did this year but did not last year, or when the Government, rarely, as they do, provide time—as to what are the Liberal Party's views on a managed market. I am staggered that there is any doubt at all, because I have had the privilege, with the exception of this year, of speaking in every Price Review debate in the short time that I have been in the House, and I have gone out of my way to say that what I believed was far more important than the particular Price Review under debate was the framework within which agriculture would operate.

One of the reasons why I advocated, during those debates, that Britain should apply to join the Common Market was so that we should be able to benefit from the managed market which had been created within the Common Market. I well remember when I spoke in June, 1961, some weeks before the Prime Minister announced, to the horror of his supporters, that we were to make application to join the Common Market, that I was howled down by Conservative Members and certain Members on this side of the House for advocating that British agriculture would be better served by operating within the managed market concept of the European Common Market.

The Minister now agrees, and the Government have come round to that view, but it was a very different story at the last election. I well remember being hounded night after night for advocating the managed market within the European concept. I well remember Tory Members coming round my constituency and saying that this would be the ruination of British agriculture. Fortunately, the farmers in my division—by a very small majority, but none the less by a majority—decided to disagree. I therefore find it very difficult to believe that hon. Members who have taken a consistent interest in agriculture are in any doubt at all about where the Liberal Party stands.

We have taken the view that as a matter of principle the farming community should more and more be able to get its return from the market and not from subsidy, and that the greater the percentage of the return which can be produced by the market price as opposed to the support figure the stronger and healthier will be the position of the individual farmer. It was to achieve this that we have seen in Europe the creation of commissions for various products, with power to co-ordinate home production and imports. In this connection, I agree wholeheartedly with the right hon. Member for Thirsk and Malton that Ministerial responsibility for those two factors should lie in the same Ministry. They cannot be divided. I shall comment on the extent to which I believe that the commission should be independent of Ministerial control.

Mr. Denys Bullard (King's Lynn)

I am trying to follow the hon. Gentleman's argument about a managed market. Surely it is a fact that under the European system the managed market would have operated only under the influence of a swinging common external tariff? Secondly, surely it would have involved a very considerable increase in the price of food. Will he not meet both those points in the new circumstances?

Mr. Thorpe

May I correct the hon. Member's use of verbs? It is not a question of saying that it "would" be possible. It "is" possible only by the means which he mentions. This system is working. The European countries have a long way to go, but the foundation of a common agricultural policy has been laid. I wholly agree that if we are to have a managed market we must have power by one means or another, whether it be by a system of quotas, tariffs, the ad valorem tariff or the tariff which becomes operative on a particular date, as with certain aspects of horticulture, to exclude imports. I concede that. I also concede that under the European Common Market there would have been—or there is—a very real possibility that the price of food would rise.

The argument which we put forward, and which I am delighted to say was subsequently adopted by the Government, who came round to this view, was that this might to a very large extent be offset by the more efficient marketing systems to be found in Europe as compared with our own, with the possible exception of milk which, I think, is without its competitors anywhere in Europe, if not the world, and, further, the consequential industrial advantages to be gained.

The hon. Gentleman asks me, very rightly, whether this system is going to increase the price of food, whether a managed market is going to put up the price of food. I think that before one answers that one must ask why a change of policy has been necessary. As I see it, the 1947 and 1957 Acts, which had the support of all parties in the House, and, indeed of the farming industry, attempted to maintain relatively free markets whilst giving a degree of security to the farming community. The 1957 Act accentuated the wish of the Government of the day to increase that security. But since 1955 it is quite clear that those Acts have failed as far as the attainment of those dual objectives are concerned.

Whilst we have seen subsidies increased from £206 million in 1951 to over £350 million in 1961, the price of food, none the less, has gone up by 10 per cent. And not merely that. The incomes of the farming community in the comparable period have risen by only 11 per cent., as all hon. Members who have agricultural interests will know, compared with an increase of 40 to 50 per cent. as far as the rest of the community is concerned. The effect, therefore, of the policies which the Government have been following is, first, that the subsidy bill has gone up secondly, that the price of food has gone up, and, thirdly, that the real incomes of the farmers compared with the rest of the community have gone down—a fantastic triple achievement even for a Conservative Government.

The Government are, therefore, faced with this fantastic economic achievement which not even Dr. Schacht or any other great economist could have planned. We are faced today with finding a new agricultural policy, first because the existing policy has, for the reasons I have mentioned, failed to achieve its objective and, secondly, because the Government, through their own stupidity, left the application to join the European Common Market so late that we now find ourselves excluded from a community of which we could have been the founder members.

I believe that the Minister is on the right lines in the policy which he has announced. Let me say in answer to the right hon. Member for Thirsk and Malton, who is asking me to go into far greater detail concerning the policy which we would recommend than we have yet heard from the Government of the day, that it may well be that there is some death-bed wish at work in the Tory Party and that hon. Members opposite are already becoming Opposition-minded and probing to see what the policy of the future is going to be.

I would have said, first of all, that it is vital in any system that we should have improved marketing, with commissions concerned particularly with cereals and meat, which could have the dual power of co-ordinating home production with imports. I believe that, ultimately, the Minister should be responsible for the decisions taken. What I think that my hon. and learned Friend the Member for Montgomery (Mr. Hooson) sought to suggest—and in this I am in wholehearted agreement—is that these commissions should be not independent of the Government but should be given an overall degree of autonomy such as is intended for the marketing commissions in the European Common Market. I believe that they must be free of the day-to-day political pressures, with, of course, the Minister of Agriculture remaining responsible for what the price fixture will be and for what quotas and what amount of imports will be allowed in any particular year.

Obviously, it is for the Minister, in company with the rest of the Government, to decide what sort of beef pro- duction we want and what sort of trend there should be in milk production, and so forth. I believe that those general overall decisions must be left to the Minister, but that the day-to-day decisions should be delegated to the commission.

Sir Richard Glyn (Dorset, North)

I am following with great interest what the hon. Gentleman is saying. He says that the day-to-day decisions are to be left in the hands of the commissions. It seems to me that there are two decisions of great importance, and I want to be clear that it is the hon. Gentleman's view that the commissions should have the duty to make them. First, the immediate control of a sudden flood of imports which might unbalance the market. Would the commissions control that? Secondly, would the commissions have the duy of coordinating the home production with imports? Would they have the power and duty to restrict home production if they thought right?

Mr. Thorpe

As I see it, and in so far as these are day-to-day matters, yes, they would have that duty, but, clearly, the over-all picture of what is to be the beef production of this country over the next two or three years is a matter for the Minister. I would recommend to the Minister that if we had a system of target prices such as is envisaged in Europe and a quota system similar to that in Europe, these would be matters which could be delegated to the commissions and the commissions would, therefore, have the power to carry out the process mentioned by the hon. Member for Dorset, North (Sir Richard Glyn). Obviously, this is an enormously complicated question. It represents a complete Government change in agricultural policy. I hope that we shall hear from the Minister or from the President of the Board of Trade in some greater detail the manner in which this new agricultural policy is going to be operated.

I am afraid that I cannot agree with the hon. Member for Salford, West (Mr. C. Royle) in thinking that the butchers always charge a fair price. Of the £78 million Supplementary Estimate in 1951, very little of it went into the pockets of the farmers. I believe that all this policy of a managed market will be set at naught unless we have a very vigorous attack on the whole of our marketing system. I should like to start with the millers and the fertiliser manufacturers and, to a certain extent, with the brewers and many other middlemen who find that the farmer is a very weak seller and who have, in my view, quite outrageously exploited his position in the last few years.

This must not be a selfish measure simply to maintain a level of production whatever the cost to the consumer and irrespective of the effects on the rest of the world. As was said in the Price Review debate, we live in a world in which a large percentage of its population are existing at starvation level. I think that this must be linked up with an attempt to get commodity agreements. I think that we may well have to take a look at the export position of many of our Commonwealth partners, who, in any event, would have found some of their exports restricted had we joined the Common Market. We have to realise that the N.F.U. plan has certain merits which should be studied by the Minister. I think that he has a very difficult job of maintaining an agricultural industry which is able to expand and thereby reduce its prices, because it has been part of the Tory philosophy that the industry must reduce its costs but must not expand. As the farming community has pointed out, it is only by expanding that costs can he vigorously cut. This is an economic point which, I think, at last has been accepted. This is perhaps one of the most difficult agricultural problems which has been faced by any Government since the 1947 Act was introduced.

Finally, by way of answer to the hon. Member for Salford, West, I think that the hon. and gallant Member for Eye was very wise in quoting the article of Mr. William Rees-Mogg in the Sunday Times. Those who would seek to regard agriculture as expendable would be very wise to ponder over that article. I have a very high regard for Mr. William Rees-Mogg, although it did not prevent me defeating him for the Presidency of the Oxford Union; but he came up and fought another day.

I believe that we must not get into a situation in which we become a divided nation, a primarily industrial nation which might believe that agriculture was economically expendable. That would be absolutely disastrous to the agricultural community. This is why—I make no complaint, and I do not make this as a party point—I think it is unfortunate that in our debates when we are discussing coal there is a preponderance of hon. Members on one side of the House and when we are discussing agriculture there is a preponderance of hon. Members on the other side of the House. I think that always leads to the threat that we may well be a divided nation. So I think it is terribly important, not only for the consumer, who, after all, in the long run will benefit by having stability of prices, but for a farming community, which has the feeling that it has security to expand and to lower its costs and make a contribution to the balance of payments.

It is also very important that this system should produce a fair price for the sake of the agricultural community itself. Because were any import system of quotas to be operated unfairly to the disadvantage of the industrial wing of our society, or, indeed, consumers generally, then I think that the consumer might well regard the vitally important minority in agriculture as being economically expendable. That would be a disastrous thing for this country, and I believe that socially as well as economically it would be a very grave blow. We should become a country of deserted rural areas with people crowding into the towns. We should become subtopia—if we are not already a subtopian country, we are getting very near it—and I believe that this would hold out very great dangers indeed for the agricultural community.

I hope, therefore, that we shall hear more from the Government about what they intend in detail for the implementation of this policy. I think that this debate has been valuable as it has assisted the hon. and gallant Member for Eye to understand what the Liberal agricultural policy is, which no doubt he will ponder over carefully, and we are very much in his debt for his having raised this matter this afternoon.

5.35 p.m.

Mr. Paul Bryan (Howden)

Like previous hon. Members. I should like to congratulate my right hon. and gallant Friend the Member for Eye (Sir H. Harrison), first, on his choice of subject and, secondly, on the way he introduced it. When the Opposition chose agriculture as the subject for debate on Wednesday last, I thought that they had rather stolen his thunder, but in fact this debate is fitting in very well, for I am sure that there are many hon. Members who value this opportunity of airing their second thoughts on the very important things that the Minister said.

As my right hon. Friend the Member for Thirsk and Malton (Mr. Turton) said, this was clearly a landmark in the British agricultural history. The Minister on that day said that he did not mean to depart from the principles of the 1947 and 1957 Acts. I am sure that he does not intend to do so. But he is certainly putting a fresh wind of change through the way in which those Acts operate, because control of imports is what the farming community has been most insistent about for many months past. If farmers have been uneasy or distressed over the last few months, their distress has been due less to such things as the Price Review than to the cloud of surplus which has overshadowed the hitherto wide open, free British market.

The 1947 Act refers to …such part of the nation's food…as in the national interest it is desirable to produce… The Government have never really had to decide exactly what the level of that production was to be. Of course, in Annual Price Reviews the Government have been able to influence to some extent home production. I suppose that market forces have also influenced that production, but in a world where nearly all produce, whether foreign or home, is subsidised, market forces have not been a true reflection of real costs. Now that the Minister is to take power to control imports he has also taken on himself the definite decision as to exactly, or pretty well exactly, what home production is to be.

My right hon. Friend the Member for Thirsk and Malton has made various suggestions in this direction, and obviously one would have to decide product by product whether one could produce it cheaply at home in relation to foreign producers and so on. At the same time, one has to have a broad principle on which to base this key decision which is the crux of what we are talking about today. Some people have suggested that the proportion of home production to foreign imports should be kept at today's percentage. This would certainly represent a check on our present rate of expansion. Today, as has frequently been said we have increased to 168 per cent. on pre-war figures. In the same time, the population has gone up by 10 per cent. By value, in pre-war days we were producing in this country about one-third of our food; today we are producing about half, and that proportion is continuing to increase.

In the N.E.D.C. Report, I see that for the years 1961 to 1965 it predicts an 18 per cent. net increase and that productivity per man is to go up by 34 per cent. These are better figures than for the previous five years, and it is obvious the rate will accelerate. So as the years go on, on present trends the farmers of this country expect to increase the proportion of home production, and not only to increase it hut, in my view, increase it tremendously. because of all the imports that come in two-thirds are of a kind that can be produced in this country.

This is confirmed in the N.E.D.C. Report. It says: The information supplied by the industry shows that it expects to supply an increasing proportion of our food supplies at the same time as raising productivity at a faster rate than over the previous five years. Another easy-sounding solution, which I read in the newspapers, is that one might decide to keep imports at their present level and to allow the home farmer to take advantage of any increase in home consumption. This, again, would represent a slowing down of our present rate of expansion. The N.E.D.C. Report says that spending on food should go up at the rate of about 2 per cent. every year. That in itself would represent a depressing and damping down of our expansion which is certainly increasing at a swifter rate than that. The Report says that technical advances tend to raise the level of output faster than the growth in the demand for food. I bring this forward to indicate that one has to think in terms of increasing production at home if we are not to see a decline in the present graph of the actual proportion of consumption grown in this country.

How is this level of imports to be enforced? I will not expand on this, because my right hon. Friend and neighbour from Thirsk arid Malton dealt with it very professionally, but the idea widely canvassed in the weekend Press was that the method should be to impose a price below which a commodity could not enter the country. That is a fairly elementary way in which to deal with the problem, for although it deals with the problem of deficiency payments, it turns the terms of trade against ourselves. The down-to-earth Russians were astonished when we would not have their barley at £14 a ton, but welcomed it at £20. I would be astonished, too, if we could not think of a better method than this. Levies of some sort would be equally effective and at the same time would do something to pay our home support costs.

I underline what has already been said about differentiating among our suppliers. I am sure that hon. Members and people all over the country will feel very strongly that No. I priority should go to the Commonwealth, No. 2 to our traditional suppliers and no priority at all to those, often from the Communist bloc, who have used our market as a convenient dump.

I am sorry that the hon. Member for Salford, West {Mr. C. Royle) was not as pleased as I was with the Minister when he said that the object of controls was not to raise but to stabilise prices, because I believe that stabilisation is what will take place. It is not just the controls but their very existence which has the effect. I am sure that when farmers in my constituency know that barley is coming into Hull, that automatically depresses the market, never mind what the quantities are. The fact that they will know that from now on there will be some sort of control will produce a new stability. The whole story of our recent meat troubles has pointed in the same direction.

The hon. Member for Salford, West said that the Minister's speech had been badly received in New Zealand and by our other suppliers from abroad. As against that, I quote what was said on 23rd May by Senator Henty, the Australian Acting Trade Minister, who welcomed the Minister's speech and said: The change in British policy could offer Australia an opportunity to secure agreements which would result in a stable market with remunerative prices for important export commodities. 1366 The Australians see a lot of sense in this and an advantage to themselves in a stable market.

The case of the imports of Argentine meat this year has been quoted. As the Farmers Weekly said a week or two ago, in the first three months of this year the Argentine exported to this country twice as much meat as in the corresponding period of 1962 and made about half the profit. So from every point of view, ours and theirs, the whole story has been unhappy.

My last question to the Minister is this. If import controls are to be introduced, as promised, when will the changes take place? Will they be made in time to affect the marketing of this year's harvest? If not, I urge the Minister to have some ad hoc measures up his sleeve very early in the day to prevent a flood of imported cereals. Nothing now would do more harm to farming confidence or create more disillusionment than a depressed and glutted cereal market in the first harvest after the Minister's announcement.

Nowadays, every country supports its home agriculture by one device or another. All have found it a tricky business. None has produced a completely satisfactory answer. In the last few weeks, there have been international assemblies in Brussels, Lisbon, Geneva and Dublin, and our Commonwealth Ministers have been meeting here in London. At each of these gatherings agriculture has been the major problem.

Efforts to provide a sound basis for agriculture in this country have had their ups and downs since the war, but by now the system, adjusted as we have gone along to meet varying circumstances, has become the envy of the world. It has produced an expansion and stability of a sort never before known in this country. I believe that these new steps will bring confidence and with it prosperity to those who owe their livelihood to British agriculture.

5.46 p.m.

Mr. George Darling (Sheffield, Hillsborough)

The right hon. Member for Thirsk and Malton (Mr. Turton) asked me to explain our attitude to the Government's new policy on food imports. We do not know what that policy is. We have had some vague assertions of unexplained intentions. The intentions may be good, but we cannot comment on them until we learn more about them. What we can do, as the right hon. Gentleman himself did, is to tell the Minister what we think he ought to do, and I propose to make my contribution and perhaps the right hon. Gentleman will be able to judge in the end whether we agree or disagree with him.

He suffered from the limitations from which all of us in the debate suffer—that we have to be far too brief, and are unable to go into the details with which we would like to deal. I congratulate the hon. and gallant Member for Eye (Sir H. Harrison) on having started what has turned out to be a very interesting, useful and timely debate. I agree with him that British farmers have done extraordinarily well ever since the war in improving, expanding and developing home food production.

However, the hon. and gallant Member weakened his case for giving them more protection by making hardly any reference to our internal marketing arrangements. While it is true that farmers deserve all the congratulations we can give them for improving production. the improvements which should have taken place in marketing have not taken place. He did not give us any nonsense about the alleged virtues of free markets and free competition. He is all for controls. I must remind him that we had a debate on the consumers' side of things last week and all his hon. Friends who spoke in that debate were all for competition, very few controls, and free markets all over the place.

The Liberal Party went even further. The right hon. Member for Orkney and Shetland (Mr. Grimond) opened his contribution in that debate with a declaration which would go down well with the Liberal Party Assembly. He said: The consumer's best friend is a free market. Competition not only allows him or her to exercise choice; competition also protects the consumer from exploitation."—[OFFICIAL REPORT, 20th May, 1963; Vol. 678, c. 60.] The hon. Member for Devon, North (Mr. Thorpe) has thrown his leader's free market and free competition right out of the window. I agree with the hon. Member and disagree with his leader.

Mr. Thorpe

I may not be in a position to offer the hon. Member the Whip, but the matter will be considered.

Mr. Darling

The hon. and gallant Gentleman covered a lot of ground as he built up his case for import controls. I shall resist the temptation to cover the same ground and I shall limit myself to a few general observations which, I hope, will meet the point raised by the right hon. Member for Thirsk and Malton, and I shall then make some comments by way of example on the meat situation, which has been one of the most troublesome problems in the minds of hon. Members opposite.

My first general observation is that the demand for stricter control of imports proves what my hon. Friends and I have been saying for the past ten years; that one cannot operate a deficiency payments system satisfactorily in a disorganised market. The right hon. Member for Thirsk and Malton said much the same thing today, but he did not say it in 1954 and 1957. However, we all learn from experience. I need not elaborate this theme because my hon. Friends and I have done so on many occasions in previous debates. We have explained the proposition repeatedly and there seems now to be general agreement about it. The Minister of Agriculture endorsed our views only a week ago.

But we cannot accept the solution of the hon. and gallant Member for Eye, of stricter import controls if they, whatever form they take, will be used to protect disorganised, inefficient and costly marketing arrangements. Moreover, when we talk about import controls we must remember that we frequently make complaints about other countries putting on import controls of their own against our exports. We must remember that, as the Minister of Agriculture, Fisheries and Food said only a week ago: We want arrangements which will ensure fair access to our market at reasonable prices, both to the overseas supplier and to our home producer. We ½wish them to be½flexible½ He also said: In reaching agreement with them"— the overseas suppliers— on measures which they should take to contribute to the stabilising of our market, we must be prepared to make our own contribution to that same end ".—[OFFICIAL REPORT, 22nd May, 1963; Vol. 678, c. 449–50.] This balancing of trade interests is one of the most difficult problems to be faced as we try to work out a new system of import controls. We must all the time remember that while 4 per cent. of our population is engaged in agriculture, 100 per cent. of our people are food consumers. For these reasons—and while I express a personal view, I believe that it is shared by my party—we must go back to the principles of the 1947 Act, which provided for a planned expansion of agriculture, encouraging farmers to produce those things which were in short supply and discouraging them on occasions from producing surpluses, through the Price Review and the development of organised marketing.

Whatever is said about the need to control imports, we believe that those controls must be part of the general marketing organisation in order to obtain stable deliveries and prices, but not to deprive our people of the increasing productivity, better supplies and price advantages from overseas, especially Commonwealth, countries. Hon. Members opposite have complained about the deliveries of cheaper meat, particularly from the Argentine, at the beginning of this year. They have said that this cheap meat was harmful to Britain's interests. I repeat what my hon. Friend the Member for Salford, West (Mr. C. Royle) said in his well-informed speech, that meat prices did fall in the shops, especially in the North. They were forced down at a time when we had nearly 1 million unemployed and millions of workers on short time.

Mr. Turton

The Retail Price Index figures must be conclusive.

Mr. Darling

They are average figures for the whole country, and if the right hon. Gentleman cares to look at the returns published by the meat traders' organisations he will find that in most of the industrial areas the price of meat went down. The reductions were in many cases substantial. I am not saying that this applies to the more expensive cuts of meat, but particularly to the cheaper cuts.

Mr. A. E. Orarn (East Ham, South)

My hon. Friend has referred to the Retail Price Index as being the average for the country. Is it not also providing average figures, in effect, of the prices of the different cuts of meat?

Mr. Darling

That is correct, and while I could give the right hon. Member for Thirsk and Malton the figures, I do not wish to delay the House. However, the people who were able to take advantage of those reductions were very pleased to do so, particularly in the industrial areas where there was a great deal of unemployment and short-time working.

I represent a part of the City of Sheffield. I urge hon. Members opposite to remember that the engineers and steelworkers in my constituency have suffered bigger cuts in their incomes proportionately than any people in the farming community. Many of my constituents have been on short-time for nearly two years and, in some cases, their incomes have been halved compared with two or three years ago. Not one of them has complained to me about those reductions in meat prices.

We believe in an organised marketing of the nation's food. We have said this on many occasions. It is implicit in the 1947 Act and we stand by it. We believe in getting food into the homes of our people as efficiently and cheaply as we can. We shall oppose any attempt to solve our agricultural problems at the expense of the housewives and consumers, not only because that would be unfair to the mass of the public, and would create other difficulties in regard to wages and our balance of payments, but also because we believe it is unnecessary. We believe in the spirit of the 1947 Act, and that we can give both the farmers and the public a fair deal, if we go back to the principles of that Act and get rid of the alterations, which have upset some of the basic ideas of organised marketing, that came in with the 1957 Act.

To explain, in answering the right hon. Member for Thirsk and Mallon, where we stand, I would remind the House that when the 1947 Act was introduced it was designed not solely to benefit the farming industry. Any hon. Member who doubts this should read Mr. Tom Williams' Second Reading speech on that occasion. Three principles were implicit in that Act, and we should remember them. The first is that the Government —and the whole community was behind this—were planning for a prosperous Britain with full employment and a fair sharing of the prosperity. We realised that that prosperity would be based on industrial activities and, therefore, we faced the danger that unless we gave special aid to agriculture we would have pockets of industrial prosperity in a derelict countryside.

The second point was that we agreed —and we still agree—that that aid to agriculture should not be given through high food prices. The third was that we wanted then—as we still want—to have an expanding agriculture and for it to be self-sufficient in those things in which it is able to be so; but not to seek self-sufficiency at too high a price or in such a way as to damage our international trade or injure our Commonwealth relations.

Mr. R. J. Maxwell-Hyslop (Tiverton)

The hon. Member is saying that the aim should be for agriculture to be self-sufficient in those things in which it can be self-sufficient. Does he believe that we can be self-sufficient in beef as well as in milk products? If so, does he still agree with what he said earlier?

Mr. Darling

I do not think that we can be self-sufficient in beef. I would be prepared, on another occasion, to discuss this matter with the hon. Member. It is an extremely technical subject. We can be self-sufficient, as we are, in milk, eggs and one or two other commodities, but certainly not in lamb or pork.

Sir James Duncan (South Angus)


Mr. Darling

Yes, pigment. I think that we shall go on importing bacon and ham.

Sir J. Duncan

Did the hon. Member say pork?

Mr. Darling

I meant pigmeat generally. We still stand by the principles that were implicit in the 1947 Act. We do not intend to allow agriculture to be the poor relation of our industrial society.

There has been public criticism of the high level of support subsidies, and here I return to the meat situation. The great increase in subsidies is, in the main, due to the disorganisation of the cereals and meat markets, for which this Government are responsible. Do hon. Members opposite remember how they cheered when the Government announced the end of bulk buying and of all our contractual arrangements? They have now come round full circle, and again want the international commodity agreements and long-term contracts at stable prices in which we on this side have always believed.

We shall be very interested when the right hon. Gentleman the Minister of Agriculture brings forward his proposals for dealing with the meat situation, but I want to use this as an example of the kind of problem we are up against, and our approach to it. I must, however, tell him, as we have said before, that import controls on meat will not work satisfactorily until we have reorganised and improved our meat marketing.

This is not hindsight. If hon. Members will look at the long drawn-out proceedings on the Slaughterhouses Bill five years ago, they will find that twice a week for three months my hon. Friends and I tried to explain to the Government how impossible it is to organise the meat trade satisfactorily through three or four thousand fiddling little slaughterhouses. I do not intend to go over all those arguments again, but I will mention just one reason among many for concentrating the whole meat trade through about a score —or perhaps thirty—well-sited, large-scale factory abattoirs.

I refer to the problem of meat storage. The increased imports of Argentine meat about which hon. Members opposite have been complaining were not the real cause of the trouble. We are bound to have ups and downs in our cattle and meat supplies—it is that kind of trade. The trouble is that we are completely inadequately supplied with cold storage facilities for these temporary and seasonal surpluses. We shall never even out these ups and downs until, throughout the country, we have adequate cold stores for both home-killed and imported meat. Our home-produced meat, when it ought to be held back from the market because there is too much in the process of getting it into the meat shops, ought to go into cold store as soon as it is killed, and at the point at which it is killed; the cold stores must be part of the abattoirs, and serve as regional centres of meat distribution.

I do not know what kind of report the Minister will get from the Verdon Smith Committee, but unless it is based on the idea of factory abattoirs and getting rid of all these small slaughterhouses--unless they are fitted in as sort of outposts to the factory abattoirs—we shall never make progress. This is not a new idea. The first Report suggesting that our meat trade should be organised on a network of factory abattoirs was put out by the Economic Advisory Council in 1930—we have been waiting 33 years for something to be done. I do not think that we can organise our meat trade efficiently in any other way. Fiddling about with import controls will not do much good if the home trade remains disorganised.

I must again mention the problems we shall face in exercising import controls, in which we believe, unless they are associated with proper marketing arrangements inside this country. We shall be in difficulties unless, in approaching the subject of meat controls, we aim at getting the whole national interest properly balanced. I must repeat what I have said a little earlier about Commonwealth trade, and will take New Zealand as an example. New Zealand is a European country which, quite by accident, happens to be about 6,000 miles away. It has a European standard of living, European methods of trade, a European population—now that the Maoris have been assimilated—and lives by supplying Britain with meat, dairy produce, wool and fruit.

New Zealand's economy is geared to our market, as we all know—we take her food, she takes our manufactures—but this trade is now out of balance. We sell more to New Zealand than we buy from her, and that situation cannot continue. One of the reasons why my steel workers and engineers are on short time is that they are not supplying to New Zealand the manufactured goods that contain steel that would be supplied if we had this trade better organised.

If we take less New Zealand produce, or force down the price of that produce, as we have been doing, we might encourage our own farmers to produce more sheep—perhaps on high-cost marginal land—but, whether or not that would do the country any good, we should certainly damage our trade in industrial products with New Zealand, which is a problem that the President of the Board of Trade has to face. We have to take a balanced view of all these national interests, and make our international trading agreements to promote the widest measure of trade consistent with our obligations to our farmers and to our own industries.

In doing that, do not let any one of us forget the tremendous debt we owe to New Zealand, Australia, and other Commonwealth countries. New Zealand continued her food rationing system for five years after the war in order to feed us. I agree with the right hon. Member for Thirsk and Malton that we have a debt, too, to our Scandinavian friends—and other friends in E.F.T.A.—that we have to honour. We on this side will not be party to any schemes that would weaken those Commonwealth ties or prevent us from honouring our debts to our friends. The House will remember that Hugh Gaitskell made that fact clear in the Common Market debates, when the party opposite was prepared to sell the Commonwealth down the river in order to get into the E.E.C.

We stand by our 1947 pledges to maintain a good level of prosperity for British agriculture. We still believe that we can do that by organised marketing and long-term arrangements for food imports, especially from the Commonwealth. I hope that that answers the questions put to me by the right hon. Gentleman. That is our policy, and we shall stick to it.

6.8 p.m.

Mr. W. M. F. Vane (Westmorland)

My hon. and gallant Friend the Member for Eye (Sir H. Harrison) said that he had been overtaken by events—my right hon. Friend's statement last week—so it is, perhaps, natural that this debate should take the line of asking to see the colour of my right hon. Friend's money.

What my right hon. Friend announced to the House last week wore the broad principles, but it was a momentous statement, and I suggest that its importance far outweighs any detail that we may be given later. The important thing for the farming industry, for the country and for every country that sends us supplies was in that announcement. It completely outweighs any small differences we may have about the methods when they are revealed to us.

It is also natural that a good deal of emphasis should have been put on consumer interests, but I thought that my right hon. Friend's whole speech paid regard to those interests, and our recent policy shows throughout interest in the consumer position. We have nothing to be ashamed of there. Not only is this an important step forward in our agricultural policy, but it is a great personal achievement on the part of my right hon. Friend. It is something which will be remembered for a long time and welcomed in circles far wider than the farming communities most closely involved.

There was revealed in my right. hon. Friend's speech something which has become clearer and clearer to me over the last few years, as it must have done to all hon. and right hon. Members, that the solution to our agricultural problems and the similar problems in other highly developed countries is quite beyond the efforts of any one country. It can be achieved only by international agreement. This will take time, and, of course, it takes more than one to make an agreement. With regard to the control over imports, my right hon. Friend said that the essence is that there will be agreement between ourselves and the other countries concerned.

It is worth noting, when we are considering food imports, that only a very small fraction of the world's food production ever crosses frontiers, but this small fraction can, nevertheless, have a very big influence on the markets of the importing countries. Our market here is the most important in the world to those countries which have foodstuffs to export. It is interesting to note that the United States of America is now one of the principal exporters to us. No longer is the pattern of trade one of industrial nations exchanging manufactured goods for foodstuffs produced by the less developed nations. Frequently, there is an exchange of foodstuffs between highly industrialised nations, a pattern very different from the one which we were brought up to believe was orthodox.

In this connection, I feel not only honoured but immensely interested to be going to Washington next week as a member of the United Kingdom delegation to the World Food Congress. The problem of dealing with surplus production, although, of course, it is by no means the key to our efforts to grapple more successfully with the problem of hunger in the world, is, nevertheless, a subject which will constantly crop up in our discussion. It poses a question which we must answer before we can successfully go forward with some of the more fundamental tasks.

When we are discussing the commodities, there is always the danger of forgetting that the long-term key to farming prosperity is not this commodity agreement or that. It is to be found in the way we handle our land and our skill in the business of husbandry. No man can farm well just as a result of price agreements. The land of our country today has never been better farmed. I say this not just because of the nice green colour put on the grass at this time of year as a result of the liberal application of nitrogen. It goes far deeper than that. How we handle our land, not what happens to sugar in Mincing Lane, or what happens in disused Lancashire cotton mills which are said to be full of chickens, is what really matters to us.

We need still more investment in our land if we are to remain competitive. We cannot remain competitive just as a result of limited import controls, as I am sure my right hon. Friend will agree. Yet farming profits soon disappear if there is unwise investment in buildings and, even more easily, if there is over-investment in machinery.

The hon. Member for Sheffield, Hillsborough (Mr. Darling) spoke of the 1947 Act. That Act has great merit. but 1947 is not a holy year, as hon. Members opposite sometimes would have us believe. The Act has, as I say, great merit, and it has proved a good deal more elastic over the years than its authors claimed at the time. It was not a great marketing Act; that came later. The 1957 Act, too, has great merit, and it has buttressed the 1947 Act. Without the 1957 Act, the 1947 Act would not have given to agriculture the stability it has enjoyed over the past few years.

Turning again to the subject of commodity agreements, cereals and meat are clearly the most important and should be tackled first, but, whereas the stability of the cereal market is very important to many farming countries, notably the E.E.C. countries and those with large arable acreages, it is not so important as a key to prosperity in this country nor in other countries on the Atlantic seaboard where grassland is more important, and where upland farming and livestock plays a very much greater part than it does, say, in the centre of Europe or in Canada.

In the uplands, it is not only the four-legged animal which matters. We must think of the rural economy also as comprising rural industries—often making use of the raw material of the locality and offering alternative employment to people. Here, I make just one reference to the "nigger in the woodpile", who was mentioned earlier in the debate in connection with food. If the woodpile were the products of our home-grown timber industry, then my right hon. Friend would remain the "nigger", particularly having regard to what, I believe, has recently been going on at Geneva.

I ask my right hon. Friend to consider the products of our woodlands in the same way as the products of our farmland are considered. This is almost the only country of Europe which does not regard forestry and farming on the same basis, and in the hill lands, particularly, forestry should play a very much bigger part.

It has taken several years for the policy announced last week to be worked out. Such changes of policy are not thought up overnight in any country, least of all an industrial country with trading interests such as ours. Probably, no one knows better than I do how much my right hon. Friend has put into this work, thinking ahead, never letting himself be submerged by the smaller and day-to-day issues which beset every Minister all the time. We passed a great landmark last week, a landmark on a fair road which we ought now to be able to tread confidently not only in the interests of agriculture and the consumer but in the interests of our industrial country as a whole.

6.17 p.m.

Mr. A. E. Oram (East Ham, South)

The hon. Member for Westmorland (Mr. Vane) said that the speech of the Minister of Agriculture, Fisheries and Food last Wednesday was the result of long years of careful preparation. If that be so, we ought to have been treated on that occasion to a little more detail and specific information than was, in fact, forthcoming.

Mr. Vane

I did not mean that my right hon. Friend had spent a great many years over the speech, very good speech though it was. What I meant was that major policy changes in a country like ours are not thought up overnight—not by wise Governments anyway.

Mr. Oram

I agree, but my point still remains that a little more detail might have been forthcoming, after such careful preparation. I was disappointed, naturally, when you said, at the outset of the debate, Mr. Speaker, that it had not been possible to select the Amendment which I and my hon. Friend the Member for Salford, West (Mr. C. Royle) had put it on the Order Paper. We felt it desirable to set that expression of opinion down because there was a danger of the debate being somewhat unbalanced if conducted within the terms of the Motion as it stood. I was glad to hear many lion. Members make the point, but the Motion itself did not indicate any concern for the consumer or any appreciation of the relation between food imports and our export trade. These two matters are taken up in the Amendment.

In the matter that we are considering today, it is necessary to find the right balance between a number of conflicting interests—the interests of rural England and of industrial England; the interests of the farming population and of the consumer; and the interests of exporters as well as importers. I felt that the speech of my hon. Friend the Member for Sheffield, Hillsborough (Mr. Darling) was admirable in preserving just the right balance that we need in this matter. My hon. Friend the Member for Salford, West felt that the consumers' interests should be paramount. I hope that he did not mean that they should be paramount irrespective of these other considerations. I am sure that he did not.

In this sort of debate, I try to express the consumer's interest. On the other hand, I understand the farmer's position and the concern of hon. and right hon. Members who represent agricultural constituencies that an adequate standard of life should be maintained for our farming population. I certainly understand the anxiety of the Government, the Treasury and the taxpayer about the rapidly rising bill for deficiency payments. Obviously, some action had to be taken in connection with that matter. The point that I stress is that, if action is taken to restrict the import of food, that must be done only with all due consideration to the interests of the housewife, the consumer of food.

I think it fair to say that the implication in the speeches of hon. Members opposite in talking about the import of food is that there has been a sudden and dramatic increase in the import of food and that this represents a tremendous danger to our farming community. I think that there are figures to prove that this is not the threat that hon. Members opposite try to make out.

The hon. and gallant Member for Eye (Sir H. Harrison) quoted figures in connection with maize and founded his case on that commodity. I suspect that he rather carefully selected that commodity because the imports of maize have increased dramatically and, within certain limits, substantially support his case.

Sir H. Harrison

I said that the imports of maize had gone down very considerably in the first quarter of this year. What I tried to bring out was that it might be necessary to restrict the import of something which we do not grow here in order to help a similar product in this country.

Mr. Oram

The hon. and gallant Gentleman was very fair in his presentation of the figures on maize, but I have referred to his selectivity because, like all of us, I need to be a little selective in some of the figures which I propose to present.

I have chosen three commodities which seem to me particularly topical in the present situation—wheat, meat and raw sugar. I have compared 1956 with 1962 in the imports of these commodities. It is interesting to note that in 1956 we imported 4.8 million tons of wheat. In 1962, imports had gone down to 3.9 million tons. In 1956, we imported 805,000 tons of meat. Last year, we imported 786,000 tons, a distinct decrease. In 1956, we imported 2.3 million tons of raw sugar, and last year only just over 2 million tons. There is, therefore, a downward trend in the import of each of these important commodities, which does not bear out the suggestion that the agricultural community is threatened with a very considerable influx of food.

Mr. Bullard

Is not the hon. Gentleman overlooking the effect on the market of sudden increases in importations? He has quoted the figures for meat. The hon. Gentleman will admit that in the first three months of this year the importation of Argentine beef was twice what it was last year. In talking about dramatic decreases, the hon. Gentleman should make some mention of that.

Mr. Oram

I agree that there are temporary increases and that these are important and that measures of control are necessary in respect of them, but, in weighing up general long-term policies, as we are doing today, we should also look at the long-term trends. That was what I was trying to bring before the House.

I was most interested in the way that the hon. Member for Howden (Mr. Bryan) brought out the extent to which home agriculture has increased its production and yields. Again, there are some very convincing figures. Between 1956 and 1962, the increase in wheat in absolute terms was 28 per cent. and the yield went up from 24.8 cwt. per acre to 32.2 cwt. per acre last year. Similar figures can be produced for sugar beet and beef. This shows that there is an actual situation and prospect, as the hon. Member for Howden brought out very clearly, of a considerable abundance in home production.

I always thought that we should welcome abundance, particularly from the point of view of the consumer. If there is more of something, it should be cheaper. Therefore, in this atmosphere of more and more coming out of the fields of Britain, one considers what effect this wonderful new productivity has had on the fortunes of the housewife who buys the bread made from the wheat, who buys the cut of meat in the butcher's shop and who buys the pound of sugar from the grocer's shop.

Unfortunately, the trend is in the opposite direction to what it should be. Instead of abundance producing cheapness, consumer prices have been going up over this period. Again, taking 1956 as a starting point, the whole of food items have gone up 18 per cent. in a period of increasing abundance. The price of bread, flour, cereals, and so on, has gone up 30 per cent. in a period when it can be demonstrated that wheat is being produced in enormous quantities. The price of meat and bacon has gone up 8 per cent. The price for sugar and preserves has gone up 33 per cent. We have had a Conservative Government in office all this time. This is the effect on the bill which the housewife has to meet in terms of consumer prices.

This might be excusable if it could be demonstrated that our imports were costing us more and that the terms of trade were moving against this country. But, as hon. Members know, the terms of trade have been moving dramatically in our favour as a consuming country during this period. The index in terms of trade in 1956 was 99. Last year, it had moved in our favour to 85. There has been an enormous increase in productivity at home. Prices to this country are favourable in the places abroad from which we buy our food. As the hon. Member for Devon, North (Mr. Thorpe) said, it is an economic miracle that the Government have been able to combine increased productivity at home, sources of cheaper food abroad and increasing prices for the domestic consumer.

We shall look with anxiety at the way in which these new policies are implemented, because restrictions on food imports, though they may be necessary in certain restricted instances, are all too likely to lead to increased retail prices rather than the reverse. We shall want to see the way in which these policies are applied in practice and we shall be vigilant on behalf of the housewife in these matters.

6.30 p.m.

The President of the Board of Trade (Mr. F. J. Erroll)

I am glad that my hon. and gallant Friend the Member for Eye (Sir H. Harrison) has used his success in the Ballot to bring this Motion before the House and I am pleased to have th s opportunity of joining in a private Members' debate on an important aspect of the economic life of the country.

A week ago, as a number of hon. Members have mentioned, the House of Commons had a useful discussion, on the basis of a statement by my right hon. Friend the Minister of Agriculture, Fisheries and Food, on the Government's future agricultural policy. On that occasion, the Committee of Supply was concerned primarily with the problem of our own agriculture industry. That has been touched on during today's debate, but the Motion gives an opportunity of considering in more detail certain aspects of the policy then announced and, in particular, the problem of imports and the need to safeguard the interests of consumers.

As President of the Board of Trade, I am, naturally, very much concerned about the proper balance between the consumption of home-produced food and of imported food. Both in the House of Commons and outside, one comes across two extreme and opposite views of the relationship between food imports and home production. I should like to mention both points of view and give my answers to them.

On the one hand, it is sometimes suggested that the Government's objective should be to make the country as nearly as possible self-sufficient in food production. In these days, there is no economic, strategic or other argument for such a course to be pursued. Britain's exports as a whole amount o no less than 10 per cent. of world exports and our standard of living depends upon the continuation and development of our international trade.

Although Britain is always classified as a manufacturing country and our exports are predominantly of manufactures, we also import large quantities of manufactured products, both consumer goods and engineering equipment, in addition to our agricultural and food imports. By way of example, we both import and export a very large quantity of machine tools each year.

The only way for us to maintain a healthy balance of payments in the long term is to concentrate on producing in Britain those lines which we can produce most competitively and to import what we cannot. For these reasons, absolute self-sufficiency in food cannot be the objective of Government policy any more than self-sufficiency in manufactured goods.

The other extreme argument is what I would call the cheap food argument of importing cheaply regardless of the consequences. It is certainly not the Government's intention that our market should be flooded by surplus overseas produce off-loaded at prices which not only cause large and sudden increases in the cost of Exchequer support but which also undermine the long-term prospects of British agriculture. So it is between these two extremes that we have the policy of the Government of maintaining the principles of the 1947 and 1957 Agriculture Acts, which involve, to use the term given in this year's Farm Price Review White Paper, maintaining a proper balance between homegrown and imported food. This is not a policy either of self-sufficiency at any price or of cheap food regardless of the consequences.

It is all very well to state the principle —and it seems a reasonable and sound one—but, as always in such cases, the difficulty is to define the proper balance. It is made no easier by the inevitable variations in agricultural output, both here and overseas, as between one year and another. I should like to make it quite clear that the Government adhere to the system of support through guaranteed prices and deficiency payments. There is no question of dismantling this system. We propose to modify our system to make it better suited to the circumstances of today.

I am sorry that the hon. Member for Devon, North (Mr. Thorpe) is not in his place, because I should like to refer to his extreme remarks, in which he said that our system had failed. I entirely disagree and I will say why. What the hon. Member said is on the record and I should like the Government's answer also to be on the record and to make plain why we disagree with what the hon. Member said.

As to the price of food, there has been a rise over the years, as was mentioned by the hon. Member for East Ham, South (Mr. Oram), who made play with the points made by the hon. Member for Devon, North. This increase in price, however, is inevitable with increases in distribution costs, which the hon. Member ignored, and the demand by the public for a greater degree of processing, packaging and the like which, in turn, is carried out by people who themselves expect to work for higher wages and to live at a higher standard of living. The interesting fact is that the wholesale price of meat this year is low, and so is the wholesale price of cereals. There is no room for doubt that the price of food is much lower under our system than it is, or would be, under the managed market system.

The hon. Member for Devon, North spoke about the level of farm incomes in relation to the rest of the economy. It is inevitable that as the standard of living rises, the proportion that people spend on food as opposed to other goods tends to fall. I wonder, however, whether the hon. Member realised how agricultural income in relation to the remainder stands in this country as compared with other countries. In a very good survey undertaken by F.A.O. in 1959, Britain came out third in the "league table" of the whole developed world with a ratio of 80-100. The other two countries that were higher than us were New Zealand and Australia, both of which are essentially agrarian nations. This, surely, is a great achievement and a credit to our support system.

The question of the proper balance at any given time must bear relationship to the balance in previous years. Indeed, we should look at the situation before the war to see how great has been the achievement and development of agriculture since the war. The proportion of temperate agricultural supplies, including sugar, coming on to our market from home production has gone up from one-half before the war to two-thirds now. In 1962, we produced about 70 per cent. of our carcase meat as against only 50 per cent. before the war, and, similarly, about 45 per cent. of our wheat, flour and cheese as against less than 25 per cent. pre-war.

We now produce nearly all our barley, pork, eggs and potatoes at home, and although the proportion is lower, we have also been producing more of our sugar. These percentage figures, which were put in absolute terms by my right hon. Friend the Member for Thirsk and Malton (Mr. Turton) in his interesting speech, highlight the long-term changes which have taken place in British agriculture.

It may be said that these changes, to a large extent, owe their origin to the war years, but this is misleading in two ways. Our consumption was at a low level in the war years, and since then, while our consumption has risen, British production has not only kept pace and maintained its share but has actually increased its share of this large amount. This is a measure of what has been achieved as a result of the Government's policy of support for agriculture. On the other side of the picture, it is also, of course, a measure of the reduction in the share of our market by our Commonwealth and other overseas suppliers.

The immediate problem is the sudden increases in Exchequer costs which arise when the bottom falls out of the market and the subsidy payments are automatically increased to make good the deficiency between the market price and the guaranteed price. This is very largely due to the fluctuations in imports. Several hon. Gentlemen have referred to the sudden fluctuations of imports coming in very often at low prices. Of course, we must also remember that the flow of produce of our own farms has played a part in the increases in Exchequer costs, These sudden imports coming in unexpectedly and lowering prices very rapidly are quite a different thing from what I may call the steady, long-term invasion of the British market by overseas suppliers such as we have experienced in some other industries, notably some manufacturing industries where we have to accommodate ourselves to the changing pattern of the flow of goods.

As I have indicated in the figures a moment or two ago, the import share of our food market has, in fact, been falling over the years. The real trouble is the unpredictable way in which imports have fluctuated. As my right hon. Friend explained last week, agricultural production is going up in other countries just as it is going up in Britain. Overseas, as at home, more capital in the form of machinery, fertilisers and better strains of seed or breeds of animal are being used in agriculture so that output per acre and per man is rising all the time. The effective demand, however, for all this pro- duction is not going up at the same rate either here or abroad, and so, in consequence, we encounter everywhere efforts to maintain a foothold in traditional markets or to capture a bigger share of whatever market may be going. So it is not surprising, really, that in these circumstances there are flurries of imports offered at almost any prices which they will fetch.

I think it was my right hon. Friend the Member for Thirsk and Malton who suggested that these imports were dumped. They are often referred to as dumped or subsidised imports, but it is not always necessarily the case that they are. For example, the increased supplies of Argentine beef which contributed so much to the dramatic fall in market prices earlier this year were not, as far as we can tell, subsidised supplies. They were coming on the open market, unsubsidised; although I appreciate that there are certain other cases in which imports reaching us are subsidised in one way or another.

One can argue, of course, that such imports coming in at very low prices are of benefit both to our cost of living index and also to our balance of payments, but the important point is that these imports at unduly low prices, despite the fact that the quantity is quite small in relation to the total supplies reaching our market over the year, can disrupt our market and cause a quite disproportionate increase in Exchequer costs; and it is in view of this that the Government intend to secure greater stability in the market for cereals and fatstock.

In working out arrangements to this end, one of the considerations which the Government will have to take account of will be our relations with our Commonwealth and other suppliers and our international obligations to them—and theirs to us, because they have obligations to us, as well as we have to them.

This is where I want to turn particularly to our international obligations. These are of two main kinds. First, there are the multilateral agreements of which the G.A.T.T. and the E.F.T.A. are obvious examples. I was glad to hear several hon. Gentlemen refer in kindly terms to the European Free Trade Association which is developing so very satisfactorily. These multilateral agreements, broadly, contain provisions directed both against the imposition for protective reasons of import restrictions and also against any restrictions being applied in such a way as to discriminate between one overseas supplier and another. Then we have tariffs—

Mr. Maxwell-Hyslop

I think my hon. Friend is not quite accurate. That we must not discriminate between other members of the G.A.T.T. does not prevent discrimination against non-signatory countries.

Mr. Erroll

No, obviously not, because if they are not members of the club, so to speak, the rules do not apply; but, in fact, it is as a matter of sound commercial policy that we apply the G.A.T.T. principles to all our trading partners who are not actually themselves yet members of the G.A.T.T.

As to tariffs, we have committed ourselves in certain cases not to raise tariffs, but in the food field this mainly affects certain manufactured foodstuffs. The most part of our food comes in free of tariff, except where certain tariffs are imposed to provide Commonwealth preferences.

A more important point I should like to put to the House is that both under the G.A.T.T. and many of our longstanding commercial treaties we have undertaken to give most-favoured-nation treatment to other countries, to treat them, in fact, all alike, subject to the special preferences we extend to Commonwealth and the E.F.T.A. countries.

Secondly, we have many bilateral agreements with individual countries. The most important from this point of view are those with Commonwealth countries for so many of whom we have traditionally provided a market in return for preferences for our own exports. These obligations are, however, only one side of the picture. I think that hon. Gentlemen sometimes think that we are always hamstrung by obligations which we are in honour bound to keep, but I should like to remind the House that of course there is another side to the picture. In return we receive very substantial benefits for our worldwide trade, which is why we have accepted such obligations. We should not, therefore, lightly infringe undertakings which we have given, as to do so might well result in damaging our own interests.

My right hon. Friend the Member for Thirsk and Mahon, I think, rather twitted me at one time about my worldwide visits to try to reach agreements with countries far away from ourselves in order to secure more trade. But, of course, we want to secure more trade. It is very important that we should.

Here I want to make the point that it is what I call the multilateral type of agreement which is often the one which best suits our interests and best reflects the multilateral pattern of our trade, because—if I may show it by contrast—the bilateral attitudes of the Soviet bloc require us often to strike bilateral balances of trade with Eastern European countries. Even in this case we have to take account of their need to earn sterling and to buy goods from the less developed Commonwealth countries to whom they sell relatively little. But with the rest of the world our trade follows a freer pattern.

I want to emphasise how important it is to us, this problem of imports of agricultural products, against the background of our worldwide trading pattern. If we had ever to force our trade pattern into the straitjacket of too rigid a bilateral trade balance, that balance would certainly be struck at a very much lower level.

Commonwealth trade follows the same multilateral principle. We sell Australia more goods than we buy from her. We sell Canada and New Zealand much less than we buy from them.

Mr. Darling rose

Mr. Erroll

Yes, it is always difficult to get this right. In the case of Canada and New Zealand we sell them much less than we buy from them and therefore we have an adverse balance with those two countries.

Having explained the general worldwide pattern, I want to make the point that our international commitments and agreements are not a lifeless and rigid body of law imposing out-of-date restraints on our freedom of action but a pattern of contractual business relationships reflecting the pattern of our trade. These relationships are not fixed for all time, and it is practicable and reasonable to contemplate the negotiation of changes. But I stress the importance of trying to negotiate the changes.

Naturally, we should have to bear in mind that our overseas suppliers have a real interest in our market and we, in the same way, have a real interest in the market which they provide for our exports. Therefore, in seeking new arrangements, we must not lose sight of the overall balance of interest between us and them. Indeed, the problem in our market is but one aspect of what is an international problem in agricultural products.

The steep fall in prices on our markets, which results from the violent fluctuations in agricultural imports, also affects the returns received by our overseas suppliers. It is to their interest, therefore, as much as to ours, that we should succeed in putting a floor in the market. They would also benefit from the stabilisation of our market and therefore we would hope and expect to receive their co-operation in steps to this effect.

The aim which the Government have set themselves, therefore, is to secure changes which will remedy the damage done by the fluctuations of food imports on our market and agricultural support system, without bringing about greater damage to the interests of our export trade or to our domestic consumers. It might be possible, for example, to reach arrangements with overseas food suppliers to sell us smaller quantities of food at much higher prices. No doubt this would solve the financial problems of agricultural support for the home farmer, but we cannot leave out of account the resulting cost of imports to the consumer. I think that sometimes we talk about consumers as if they were some kind of special animal; but we are all concerned with the cost of living. It is important directly to our own standard of life and indirectly to the competitiveness of the exports on which we all rely.

The Government are, therefore, not prepared to base their policy on a long-term rise in the cost of food to the consumer. The object is to prevent sudden falls to quite unduly low prices. It is open to question whether they work their way through to the consumer, but very low prices cause hurt to the agricultural support system.

I therefore want to explain what we intend to do. In the coming months we shall be discussing cereals and meat in the specialist groups at the G.A.T.T. These are the important commodities, because they account for about 80 per cent. of the support payments, and if a practical solution is to be achieved it will be necessary to discuss the existing problems realistically and in detail. My hon. Friend the Member for Westmorland (Mr. Vane) referred to this as being an international problem. Certainly it is, and our hope is that we shall secure an international agreement to deal with what is in essence an international problem.

My hon. Friend the Member for Howden (Mr. Bryan) asked about the dates and how long all this would take. If such commodity agreements or other long-term arrangements cannot be achieved rapidly—and I regret that I cannot give my hon. Friend precise dates as early as this—it will also be our endeavour, whether as a result of these international negotiations, or as a result of the discussions which we are holding direct with our suppliers, to ensure that by one means or another interim solutions may be arrived at quickly, pending the more permanent arrangements. My right hon. Friend and I will push ahead with the international consultations, parallel with the discussions which he is having with the leaders of the home industry.

My right hon. Friend the Member for Thirsk and Mahon suggested that food imports should be the responsibility of the Minister of Agriculture rather than the President of the Board of Trade. I make no claim for a monopoly in this field, but I suggest that my right hon. Friend should consider the advantage of having in one Government Department general responsibility for Britain's commercial relations with the whole world, whether Commonwealth or foreign countries. In foreign countries our commercial representatives are part of the Foreign Office overseas staff, whereas in the Commonwealth countries they are appointed by the Board of Trade.

This makes no difference to the overall concept that one Government Department, whatever one calls it and whoever is head of it, should have sole responsibility for commercial relations, of which agricultural interests are an important part. This is why I spend a good deal of time in negotiating agreements of a bilateral and multilateral character. I do that with the help of my officials because we are covering the whole field and not part of it. This is why I have to balance the advantages of the purchase of agricultural products from Poland against the advantages of increasing our export opportunities in that country, and so all the way round the world.

As for the negotiations which lie immediately ahead in the implementation of the policy announced by my right hon. Friend last week, I should like to make the important point that in all operations of this kind some give and take will be necessary on all sides. Granted this flexibility and desire to reach a solution of the problem, which affects other countries as well as ours, I am convinced that stabilisation of markets at broadly the present general level of prices can be achieved, not only for the benefit of the taxpayer and the farming community but to the advantage of the country' as a whole.

Question put and agreed to.

Resolved, That this House welcomes the decision of Her Majesty's Government, to use measures of control of certain imports of foodstuffs as a means of stabilising the market for agricultural products in this country.