WHITE FISH AND HERRING (SUBSIDIES AND GRANTS)

HC Deb 15 July 1964 vol 698 cc1300-44

8.14 p.m.

The Minister of Agriculture, Fisheries and Food (Mr. Christopher Soames)

I beg to move, That the White Fish and Herring Subsidies (Aggregate Amount of Grants) Order 1964, dated 24th June 1964, a copy of which was laid before this House on 2nd July, be approved. There are three other fishery Schemes on the Order Paper and, as it is customary to take the opportunity of the annual subsidy Orders to set them in the framework of the general state of the fishing industry, I suggest that it might be for the convenience of the House if we took all four at the same time.

Mr. Deputy-Speaker (Sir Robert Grimston)

If the House is agreeable.

Mr. Soames

I should like, first, to give the House a description of how the economic position of the fishing industry has developed. I remind hon. Members that the Government's policy towards the fishing industry stems from the Fleck Report and decisions on that Report which were announced in the 1961 White Paper and given effect in the Sea Fish Industry Act, 1962.

Essentially, it is a policy of assisting the industry to full viability through measures of constructive aid exemplified by the building grants and the support of programmes of research and development, for which the White Fish Authority is responsible, and through operating subsidies to be phased out over a 10-year period.

At the time the 1962 Act was passed and its subsidy provisions took effect, the fishing industry was going through a lean time, partly due to lower catches and partly to poor market prices. The situation was such that many who had taken building loans from the White Fish Authority were having difficulty in continuing their repayments, and we thought it necessary to provide for a moratorium to help those in difficulties.

Since then there has been a decided improvement in the industry's fortunes. The near and middle fleet first felt the rising tide and was in a much better case throughout 1963. The distant water fleet felt the tide somewhat later, but the trawling fleet as a whole this year has continued so far to experience notably better times. Some ports and some sections of the fleet have fared better than others, but the improvement has been general.

Let me give a few figures in illustration. In 1962, the total catch of the British fishing fleets was 15,600,000 cwt. giving them a return of £48,700,000. In 1963 the comparable figures were 16,100,000 cwt. and £51 million, an increase between the two years of £2,300,000 in proceeds, or about 5 per cent. In the first five months of 1964, the catch was slightly lower than in the same period of 1963, but the value of the catch to the fishermen showed an increase of from £20,200,000 to £21,600,000, a further increase of £1,400,000, or about 7 per cent. Those are overall figures covering all sections of the white fish and herring industries.

We must not be complacent about this decided change for the better since 1962. The fishing industry is notoriously subject to ups and downs and is so much at the mercy of a fluctuating natural resource that it can hardly be otherwise. At the root of the long-term problem is the need for intelligent conservation of fish resources in the North Atlantic. This is essentially an international problem and one which, I assure the House, Her Majesty's Government intend to pursue and to continue to pursue energetically and constantly. In this it has the full support and co-operation of the industry. There are also outstanding problems on the marketing side, with the question of the quality of fish very much at the centre.

None the less, there is happily this marked improvement in the returns of nearly all classes of fishing vessels, and it seems to be continuing. It is against this background that we must look at the subsidy orders before us.

I will first take the trawling fleet, comprising white fish vessels of a length of 80 ft. and more. For these there is a basic operating subsidy of so much per day at sea, with additional provision in the 1962 Act for special or supplementary subsidy to meet special difficulties. The Act provides for the reduction of basic subsidies each year by between 7½ per cent. and 12½ per cent. of the initial rates fixed in 1962. As hon. Members will remember, it was agreed at the time with the leaders of the trawler owners that the first two reductions should be at the minimum rate laid down in the Act, that is, 7½ per cent. For this year there falls to be made the second of these reductions, and the basic rates for the year have been fixed accordingly.

Then there are the supplementary subsidies designed to meet particular short-term difficulties. The maximum that can be paid on them under the Act is £350,000 in any one year. We have always fixed these subsidies on the basis of the most recent information available. Last time we fixed rates from 1st February to the end of July of this year on the basis of estimates of profit and loss for the nine months ending September, 1963. This time we have taken estimates of profit and loss for the period October, 1963, to March, 1964, and looked at these in setting out and deciding upon the special subsidies for the next six months beginning 1st August.

The figures for that six months show a striking improvement over the previous nine months. Taking the fleet as a whole, average returns per day for that six months compared with the previous nine months have increased for near-water vessels by 13 per cent., for middle-water by 11 per cent. and for distant-water vessels by 5 per cent. These, of course, are average figures. Some sections have done much better, notably in Scotland, and there are small sections in England and Wales which have made losses. But, based on these results we have been able to fix for the following six months minimal rates of special subsidy for a few classes of vessels at a few ports, which are shown in the Schedule to the Order, at a cost of only about £25,000 for the next six months period.

Last year, for the year as a whole, we allowed for £340,000, which was knocking on the limit allowed for in the Act for any one year. But the House will remember that the total provision for special subsidies in that Act is limited to £2½ million over a ten-year period, so that savings made in favourable periods like the present one mean that more funds will be available later if need be. We are only fixing the special subsidy for six months, so that if circumstances change we can look at the position again in the Autumn.

The herring industry had somewhat chequered results in 1963. In the early part of the season catches improved, but prices were lower, and over the year as a whole average proceeds have not changed very much from the previous year, so we have decided to leave the subsidies unaltered.

As regards the inshore side of the industry, here again almost all sections in Scotland did very much better in 1963 than in 1962. The exceptions are the Scottish 70 ft. vessels, known as sputniks, which did worse and indeed made substantial losses. For England and Wales the picture is not quite so simple. While the larger vessels and the seiners did better than in 1962, the smaller vessels had less good results. There are always bound to be these fluctuations in a section of the industry with so many units fishing widely separate grounds—I am talking about the inshore side-but we have to look at these matters from the standpoint of Great Britain as a whole and we have decided—I think that the House will agree that this is right in the circumstances—to leave the level of subsidy for the inshore fleet unchanged for the coming year. With the wider fishery limits which the inshore fishermen will shortly begin to enjoy, there should be good prospects of their returns showing further improvement in the future.

To provide the moneys required for all these subsidy proposals for the trawling fleet, the herring fleet and the inshore fishermen, the third Order asks the House to make available an additional £4½ million compared with the £5 million that we had to ask for last year. This will be enough to cover the estimated expenditure for the coming year of up to £2½ million for the trawler fleets, £1½ million for inshore vessels, and about £400,000 for the herring fleet. These subsidies are, of course, made direct by the Fishery Departments, whereas the grants and loans for building vessels are administered by the White Fish Authority.

Members will have had an opportunity of reading the recent annual report of the White Fish Authority, and at this point I would, if I may, pay tribute, in which I know the House will join, to the chairman of the White Fish Authority, Mr. Roy Matthews, who took up that office a year ago. We are very fortunate to have a man of such repute and drive to lead the Authority. Indeed, the fishing industry is being very well served both by Mr. Matthews and by Sir John Carmichael who directs the Herring Industry Board.

When he took over as chairman of the White Fish Authority, Mr. Matthews made a tour of the ports and had talks with all sections of the industry. Fishing results had been poor for some time, and it was against this background that he put forward ideas aimed, as Parliament wishes, and as Parliament expressed in the 1962 Act, at ensuring the viability of the trawling industry in the long-term without Government aid. He suggested, however, that as a first step an immediate increase in the level of direct Government subsidy was necessary. In view of the marked improvement which has taken place in the fortunes of the fleet, we have felt that there is today no case for such an increase. Indeed, as I have already said, we have not found it necessary to commit all the money that is available for special subsidy for the coming period, let alone to seek an Amendment to the 1962 Act which would be necessary to increase the basic subsidy.

Others of Mr. Matthews' proposals were designed to secure an improved price at the point of landing and for the better marketing of fish generally. First, there would be measures of quality control to take off the market fish which, although of sufficient quality when seen by the port health inspector, is unlikely to be in good condition when it reaches; the shops. Secondly, he proposed more advertising of fish. Thirdly, under this heading he proposed the promotion of a statutory scheme of minimum port prices under the powers already available in the Sea Fish Industry Act, 1951, accompanied by arrangements for support prices for fish which pass the new quality standards but at the same time fail to fetch the minimum price. The Government are at one with the Authority in wishing to see better standards of quality. The advertising of fish is a matter for the Authority to discuss with the industry and the trade, and the question of Government approval or financing does not arise.

As regards proposals for minimum and support prices, the Secretary of State and I have told the Authority that we are ready for them to discuss with all sections of the fishing industry and trade the possibility of a statutory scheme such as it has in mind. We should, of course, want to know whether such a scheme would be generally acceptable to the industry and trade, and we would need to be satisfied that it would be practicable in operation. We would want from the Authority an assessment of its likely effect on others, and especially on the consumer. We would want to know whether support price arrangements should accompany statutory minimum prices, and how the Authority and the industry propose to finance the plan. We have explained that in the meantime the Government do not feel able to give any advance commitments as to their attitude. We must obviously keep an open mind until the Authority has had its consultations and come up with its conclusions.

On the catching side, the Authority has responsibility for administering the grant and loans scheme for new vessels. Early this year the House approved a new Order which for the first time made grants available for freezer trawlers. We did not then feel it necessary to increase the limit of £2 million for grant aiding the building of new vessels up to the end of 1965, which was part of the agreement between the Government and the industry at the time of the 1962 Act. However, things have been moving faster than we or the White Fish Authority expected. We have therefore decided that the review of our present grant policy, which was due to take place at the end of 1965, should be brought forward, and we propose to carry it out with the Authority and the industry towards the end of this year.

We have decided at the same time to make available a further £500,000 for these grants, which is still within our statutory authority, so that the Authority can approve the applications which it already has, or can reasonably expect to have before it, for immediate building and which it wishes to approve.

So much for the new vessels. The Authority also put forward proposals to grant aid the improvement of existing vessels, and out of that has come the Fishing Vessel Improvement Scheme which is the subject of the remaining Statutory Instrument before the House. It is a further Measure for modernising the fleet.

Like Section 3 of the 1962 Act—and it is under this Section that the Scheme is laid—the Scheme itself is drawn in general terms. The basic idea is to assist and encourage the improvement of existing vessels from the point of view of catching, handling, processing and storage on board. Straight renewals and replacements of equipment will not qualify.

At this stage we cannot say precisely what alterations and improvements will be included, but to give the House an idea, among the possibilities that we have in mind are the conversion of conventional vessels to freezers or part freezers, the introduction of automatic engine room control, the improvement of fish holds by insulation or refrigeration, the provision of processing equipment on board ship and re-engining to provide increased power or substantially to reduce the costs of fuel.

At the moment most of these developments are still in the experimental stage, and qualify for the grant of up to 50 per cent. which the Authority is authorised to make so that the improvements and innovations can be tried out in practice. But as and when they become established they can be accepted as improvements under the new Scheme, qualifying for grant aid to all owners at the rate of 25 per cent., or 30 per cent. for the under-80 ft. vessels.

We shall agree with the Authority what types of improvement are to be regarded as experimental and what are to be recognised as established improvements, and the Authority will then tell vessel owners the items on which it is prepared to entertain application for grant. Financial provisions for the Scheme are covered by Section 3 of the 1962 Act, but it is likely to take some time for expenditure under the Scheme to build up. Eventually, however, the Authority will be able to grant aid a wide range of alterations, calculated to lead to greater efficiency or economy in the operations of the existing fleet.

I commend the Scheme to the House as something which will be of practical and progressive importance in the equipment of the fishing industry, to meet the competitive conditions of the future. Again, I see it as complementing the valuable work which the Authority is doing under Sir Frederick Brundrett in research and development. The White Fish Authority's report records its research and development expenditure during the current year as being matched pound for pound by the Government, subject to a ceiling of £300,000 a year.

The cost of the Industrial Development Unit, which manages the programme and is, so to speak, its hub, has not hitherto been included in the grant arrangements. We have now decided that the Government grant will be extended at the 50 per cent. rate to include expenditure on the Industrial Development Unit and also a programme of economic and market research into the problems of the fishing industry and trade which the Authority wishes to develop. The cost of these additional items will be about £50,000 a year. I believe that these research and development activities of the Authority are making, and will increasingly make, an important contribution to the technical advancement of the industry.

To sum up—I have been able to give the House, this year, a more confident account of the state of the fishing industry which has recently emerged from a run of bad years. At the start of 1963 the near- and middle-water fleets began to do better, and the recovery in their fortunes has gone on and still continues. The distant water fleet did not begin to meet better times until later in 1963, but there is no doubt that overall the fishing fleets are now finding the market much improved.

There might have been some reason for doubt a year or so ago whether the Act of 1962 would do its job within the 10-year term envisaged for the phasing out of the operating subsidies for the trawling fleet. With the uncertainties that inevitably face a hunting industry like fishing, this is perhaps inevitable, but certainly there is less reason—I put it no higher—for such doubts today.

This is a matter for satisfaction not only to this House but also to the industry, and to those who accept its rigours and serve it with courage and with skill. Of these rigours we have been tragically reminded by the news of the loss last night of a Scottish seine net boat through a collision in bad weather with a Polish herring trawler. Full reports are not yet available. The latest information I have is that three of the crew of six were picked up, one of whom has since died. The other three, and a boy of 17 making a holiday trip on the vessel were missing but the search was continuing. I am sure that the House would wish to extend its sympathy to the relatives in their loss and anxiety.

Both sides of the House desire to see a flourishing fishing industry. I believe that the further measures which I have outlined tonight will contribute to the strengthening of the industry's future position, and I commend these Orders to the House.

8.36 p.m.

Mr. James H. Hoy (Edinburgh, Leith)

May I, on behalf of my right hon. and hon. Friends associate myself with the remarks of the Minister regarding the tragic loss of this Scottish fishing vessel. I have no doubt that the hon. Member for Banff (Sir W. Duthie)—our hon. Friend I might say—will want to say a word about it. This is part of the price which has to be paid in this industry and it is just as well that, when considering the future of the industry, we should remember the sacrifices which we ask of the people engaged in it and the measure of our contribution to help them. I have no doubt that the House will want to hear the latest news about this tragic occurrence.

The white fish and herring subsidy schemes before us always seem to me to provide a contradiction, and the first thing to do is to get the matter right. We say that what we propose to do is to increase the sum available from £35 million to £393½ million. This conveys an impression to people outside that the fishing industry is getting a little more. We must face the fact that, as a result of the agreement arrived at a year or two ago between the Ministry and the representatives of the fishermen, the industry today is receiving 15 per cent. less in subsidy than two years ago, despite the increase in the sum of money available. I have always argued that it was a bad agreement. I have said in this House that the industry came to a bad agreement, so we should get this matter into proper perspective and remember that we are providing a subsidy which is 15 per cent. less than it was two years ago.

There is a considerable change even in the drafting of these Statutory Instruments which are before us tonight. It is always difficult for an ordinary backbench Member such as myself to make these comparisons. I see some changes which bring the herring industry subsidy more in line with the drafting of the white fish subsidy. There are one or two changes, and I am sure that hon. Members will not mind if I refer to them.

I see that the phrase "period of 24 hours" now replaces what used to be referred to as a day. There must be a reason for it. I think I can guess what it is, but it might be a good thing if the Minister explained to the House what is the meaning of these changes. Perhaps the Secretary of State for Scotland will say something about them. He will understand why these changes are necessary. I remember last year that when these Statutory Instruments were presented I came across a sentence which I thought had never appeared before in an Order: No grant shal be made payable in respect of a voyage if the appropriate Minister is not satisfied that in the course of such voyage fishing has been diligently and vigorously prosecuted. I remember raising this matter at the time. The Minister said that it was an innovation. It had been placed in an Order for the first time. Having made acquaintance with this friend last year, I looked in vain for it this year. Did the Minister think that from his own point of view it would be better to leave it out of the Order this year?

I wish to say a few words about the drafting of the Herring Industry Scheme. If my reading is correct I see certain differences between the 1963 and the 1964 Schemes. If one compares paragraph (3) of the 1963 Scheme with paragraph (3) of the 1964 Scheme one sees certain changes of a fairly substantial character. Last year paragraph (3) called for certain returns if firms were to qualify for subsidy, but this year this is spelled out more clearly and more definitely making greater demands on the industry, if I am correct. It says: including detailed accounts, for such period and in such form as the appropriate Minister may require, of the financial results of the operation of all such vessels of which he is the owner or charterer". This demand was not included in any previous Scheme. Comparing the paragraphs in the Schemes of 1963 and 1964, it seems that a change has taken place.

It is also interesting to note that there appears to be a change in the wording in paragraph 8(3). I am a little surprised that the Secretary of State for Scotland should be responsible for this. In the Schemes up to the present time it has always been said that the Minister "may pay", given certain circumstances. Successive Secretaries of State for Scotland have argued more often than any Minister in this House the respective merits of "may" and "shall". I am interested to see that in this Statutory Instrument the word "shall" replaces "may". I do not know who has won.

There were certain changes about the size of vessel. Paragraph 8(3) says: any grant…shall be paid…unless the appropriate Minister is satisfied that the alteration is likely to be conducive to the increased fishing efficiency of the vessel". This is a change from the previous Scheme. If such changes are to take place, the Minister should inform us of the reasons for them.

Having made these comments on the Schemes and their drafting, we have to consider whether the new Schemes meet the needs of the fishing industry. That is the reason for them coming before us. I agree with the Minister that certain improvements have taken place, but there have been certain reasons for them outside the industry. I have no doubt that the fishing fleet has been fishing full out. Conditions have changed and have allowed it to do so, but the Minister will not be unaware that the price of meat showed a steady increase over a long period and at one stage reached very nearly an all-time record. That made possible an easier market for the sale of fish. That is one of the influences to be taken into account when making an assessment of the annual out-turn of this industry's product.

This was very helpful to the industry. It is one of the things we should not overlook. Despite all these improvements, what we have to give particular attention to, whether there are improvements in one part of the industry or the other, is the out-turn of the accounts. I join with the Minister in paying tribute to Mr. Roy Matthews of the White Fish Authority. He has done a tremendous job. My one regret is that the Minister was not a little more forthcoming in telling us what Mr. Matthews' complete proposals were. Until we know what the total proposals are, it is quite impossible for us to make any reasonable comment, or even to apply any judgment.

I should have thought that the Minister would have wanted the House to have this information, and that he might even have considered publishing Mr. Matthews' proposals. That could have done no harm, and those in the industry should be allowed to see the proposals. I am sure that Mr. Matthews, with his undoubted ability—and we know his record in business and in industry—would not make foolish proposals, but that anything he proposed would be well thought out before it ever reached the Minister. I therefore ask the right hon. Gentleman to be a little more forthcoming about these proposals.

The White Fish Authority says that as a result of failure it has had to assume the rôle of vessel owner. That has resulted in spite of improvements in conditions. The Authority now finds itself the owner of vessels it does not want. It is compelled to accept that responsibility, and has found it rather unprofitable to manage the vessels. That is not one of the jobs for which it was set up, but it results from the economics of the industry.

The Minister might tell us what the Authority is expected to do with the vessels. Quite obviously, it cannot go on perhaps even adding to the number but, that aside, what is to happen to those vessels presently in the hands of the Authority? Is it proposed to sell the vessels to owners in our own country or, perhaps, abroad? If so, we would want to know who is to bear any losses that may be involved, because it would be rather a back-handed compliment to the Authority if, having been asked to dispose of the vessels, it had to carry any loss resulting from that transaction. Perhaps the Minister would tell us what the Government want from the Authority in reference to the disposal of the vessels, and who is to meet any losses that may ensue.

We see from the accounts the hard facts of the situation. Despite what the Minister has said, the accounts for the last complete year of the White Fish Authority, to 1963, show that loan interest and repayments of capital due on 31st March had not, by the end of May, been met to the extent of £1,564,000. That is the amount of the industry's debt to the Authority that has not been met. We cannot describe an industry as being in good heart and good condition when it owes £1½ million to the people who have been lending it money.

The result of a year's working shows an increase in debt of more than £300,000, over the previous year. The result of the successful year that the Minister has described is that £300,000 more is owed to the Authority than was owed in the previous unsuccessful year. The Authority says that, after taking all this into account, the provision of £255,000 that it made for bad debts will be substantially exceeded. Therefore, despite it all, the Authority expects at least—and I put it very modestly—that bad debts cannot amount to less than £300,000.

This is not indicative of an industry in good condition. This goes on adding debt to debt, because those who borrow from the Authority must pay ½ per cent. to cover bad debts. What will happen as a result of this is that those who are paying their way will find the burden heavier and heavier to meet the losses of the unsuccessful. This is iniquitous. It must be looked at by the Government. The remainder of the industry should not be compelled to go on adding to its payments to clear the debts of others.

Whatever happens, these Measures cannot provide a basic cure for the industry as it stands today. Although we welcome any improvements which are taking place, in my view—and, I am certain, in the view of many hon. Members on both sides—radical changes must take place. Until we can devise a system which will get rid of this debt charge and allow the industry to become viable, we shall fail in our job.

That is why I said at the very beginning that, if we were to do this, we ought to know what the complete proposals of Mr. Roy Matthews and the Authority were. I am certain that when Mr. Matthews carried out his investigations—we know how thorough he was—he wanted not only to give us an efficient industry in all its aspects,—catching, marketing, wholesaling and retailing—but wanted to produce at the end of the day an industry which could stand on its own feet, if those are suitable words to use of the fishing industry. That is the sort of industry he wanted.

This is a much greater and bolder objective than has ever been attempted with the agricultural industry. It is hoped in 10 years to get rid of subsidies for that altogether. If the Minister could say to the Chancellor of the Exchequer about the other part of his Department, he would get at least a knighthood in return. This is what we are doing with this industry. That is why it is essential that the complete proposals of Mr. Matthews are given to us to consider so that we can see if they meet the situation. There may even be one or two people in the House who know sufficient about the industry to add their suggestions to those of Mr. Matthews. Until that is done, we cannot make a competent judgment.

I agree with the Minister that in all this consultations will have to take place. As I said in the House not many weeks ago, one of the things we must do is to remember the consuming end of the industry. One can send up prices and subsidies, but eventually somebody must pay for them. If it is not the taxpayer paying through taxation, it will be the consumer paying through increased prices.

This is why we have had this complaint. This is where I think that one section of the industry or one part of the industry has failed. In all the changes which are taking place, each section of the industry apparently meets separately. They never seem to get together to discuss the problems which are common to the industry as a whole. In recent times we have had this complaint from the fish fryers, because they say they are being held up, not perhaps to ransom, but they are arguing that because of action taken by the B.T.F. certain landings have been restricted.

I am told by those in the industry that this is not true. I do not know. I am not competent to judge. I am told by those in the industry that if the Faroese want to export fish to this country at this time we are not keeping them out but that there is some £140,000 to £150,000 worth of business awaiting them if they want to send it to us.

On the other hand, a complaint has been sent to many hon. Members that there has not even been a meeting of the White Fish Industry Advisory Council since the change in the constitution of the White Fish Authority. If we are making these changes and appointing advisory councils, for goodness sake let them be used and let them make a contribution. If we do not intend to use them, we should not set up such bodies.

I should be interested to hear from the Minister why this Council has not met, because I am sure that, if we could get the various sections of the industry together, they could hammer out many of their problems. I know from a meeting which was held upstairs between the joint Parliamentary fishing groups that even in the matter of advertising we had an offer by other sections of the industry who were prepared to pay cash into a common pool, even under the Authority, to do this job.

I cannot complete my remarks without commenting on the grants for the improvement of fishing vessels. This is a real step in the right direction. To illustrate what I mean, I know, for example, of many vessels which had engines placed in them as an experiment. Those engines have not turned out to be by any means successful, although the poor trawler owner has had to pay for them. If owners are to be efficient, those vessels will have to be re-engined, and I take it that that will be covered by the improvement grants. To that extent I trust that the owners will be better off.

I recall looking at an Order the other day and it seemed to suggest that payments might be made to people who take the trouble to pack fish at sea. I should be delighted if that could be done. At one time the trawler owners in my constituency took the trouble to box the fish at sea and they received special payment for doing so. I have always argued that if anyone goes to the trouble of providing first-class food in a first-class condition, he is entitled to a financial reward.

In welcoming what is being done, we should not forget that other changes are necessary. This applies equally to other parts of the fleet. I think that the grants will be available even to the distant-water fleet and I hope that the Minister will look into the question of making loans available. We give substantial loans to other interests on special terms. Indeed, we encourage industry in some areas by not charging interest for the first year or two. I trust that facilities will be offered to the distant-water fleet, certainly on interest terms in line with those charged by the Public Works Loan Board.

While we welcome the improvements that are being made, the fishing industry still faces many problems which must be solved if it is to become really solvent. The outturn of the accounts of the White Fish Authority prove that many problems still remain, although I appreciate that these Statutory Instruments may tide the Authority over for another 12 months. During that time anything may happen. We cannot forecast with complete accuracy what will happen. I hope that when the Government have thoroughly examined the proposals of Mr. Roy Matthews, those proposals will be made available to hon. Members. I also hope that substantial amendment of the 1962 Act will be forthcoming. I urge the Minister and the Secretary of State to realise that these additional steps are necessary if the industry is to be placed on a sound footing.

8.58 p.m.

Sir William Duthie (Banff)

I wish to express my deep appreciation of the sentiments which have been expressed by my right hon. Friend and by the hon. Member for Edinburgh, Leith (Mr. Hoy) concerning the terrible disaster which has befallen the people I represent. These men came from my own native village. Indeed, the crew of the "Sirius", which was run down by the Polish trawler "Zieba" yesterday, are my own kith and kin. I have no further detailed information other than that which I received this morning. I am told that the crew consisted of six men and one boy, who was making a pleasure trip. I am advised that there are only two survivors. That is the only news I have.

This matter raises a point of extreme interest. This Polish vessel ran down an inshore fishing vessel on her home ground. I suggest to my right hon. Friend the Secretary of State that it is absolutely vital that the most searching inquiry should be made into this tragic occurrence. I say this because there is sometimes competition of a very severe kind at sea between visiting foreign fishermen and fishermen from this country. It would be terrible if anything of an untoward nature emanated from this tragedy. I know that the people who suffered bereavement will be grateful for what has been said on the Floor of the House tonight.

I congratulate my right hon. Friend on his very encouraging survey of the industry and also by the hon. Member for Leith, who opened the debate for the Opposition, on his very informative survey of the industry. It is true that this industry will never remain static. It is developing all the time. It falls to my lot to visit every fishing port in this country at least once a year and sometimes foreign ports. During last year, I visited Hull, Grimsby, Fleetwood, North Shields and all the Scottish ports in addition to visiting Bremerhaven, to look at the new German fleet. Anyone with any knowledge of the industry can see the vast changes taking place from day to day. What is done in a previous year forms little or no basis for computing what will be done in the current year or the years that lie ahead.

Our discussions on subsidies always seem to happen just before the Summer Recess, when a pistol is more or less levelled at our heads in that if we do not accept the proposals that are put forward we shall have to go without subsidy from 1st August or 1st September. This time, I am not cavilling because I think that the subsidies are very good.

I should like to deal with the section of the industry that I represent, the inshore industry, because I know that my hon. Friends the Member for Haltemprice (Mr. Wall) and the hon. Lady the Member for Tynemouth (Dame Irene Ward) will probably speak in detail, from this side of the House, on the trawling industry. These subsidies are of the most life-giving value to the inshore fishing industry. There is talk of their phasing out. I cannot see that happening until the housewives in this country are called upon to pay a viable price for fish. The hon. Member for Leith mentioned the debt that we owe to the White Fish Authority. If that debt is to be paid, it has to come out of the cod end, and that can only be done if equitable prices are secured for the fish when the boats come ashore.

On the question of subsidies, I think that it is true to say that since 1951 something like £41 million has been paid to the fishing industry, and a very considerable portion of that, I gladly own, has gone to the Scottish industry and the inshore fishing industry in particular. I can assure the House that that money has been an absolute godsend. It has enabled many boats to keep sea-going which would otherwise have been tied up at the dockside.

My right hon. Friend the Minister talked about the ups and downs of the industry. There are ups and downs all the time. Every new development emphasises the need in this industry for research and yet more research into the type of vessels that we are using, our catching methods, the grounds we are fishing, the gear and marketing. We are looking with very considerable confidence to Mr. Roy Matthews and the White Fish Authority which has opened up new fields hitherto unexplored.

May I touch on a few matters of detail respecting inshore fishing? The first concerns the herring industry and the anomaly which is evident in paragraph 10 of the Herring Subsidy Scheme. No provision is made in respect of the day on which the herring catch is discharged if that is not the day of the vessel's arrival. That is not a restriction applied to the white fishermen, and the herring fisherman seems to be under a disadvantage. The view is held, with a certain amount of justification on account of past experience, that the herrings are caught during the hours of darkness and that the landing should take place the following day, but I should like to point out to my right hon. Friend and the House that seine fishing and trawling are done during the hours of darkness, particularly during the summer, and I cannot see why there should be any disparity in treatment for the two sections of the industry.

I also want to emphasise the importance of the price to be paid for herring for oil and meal. The Scheme twice mentions 25s. per cran. Will the Secretary of State assure me that that will not be for a percentage of landings but for the total landings of herring which are used for oil and meal? We all remember all to poignantly the difficulties which occurred at Ullapool last year, when 15s. per cran was paid for herring for oil and meal. The fishing industry asked for a substantial increase, but that was denied by the Herring Industry Board. It was afterwards found, when the accounts were investigated, that 25s. a cran could have been paid. It is only right that I should say that in my opinion the Herring Industry Board was very much at fault in that regard, and I sincerely trust that every step will be taken at the Scottish Office and elsewhere to ensure that there is no repetition of that blunder.

In the white fish industry I can assure the House that there is a new spirit of confidence engendered by Mr. Roy Matthews at the head of the White Fish Authority. I welcome these subsidies, but I ask the Secretary of State to think again about the different provisions for herring fishermen and white fishermen with respect to the day of landing.

For some years we have had no grants or loans for new, small, dual-purpose vessels for white fishing and for herring catching. Our boat-building yards have been virtually idle in the interim. I appeal to my right hon. Friend to ensure that new liberality enters the business here and that grants and loans will again be available for building new vessels so that young men entering an industry which is in their blood will not be held back through lack of new vessels.

The Statutory Instruments are first class, and I am sure that the House will pass them without a Division.

9.9 p.m.

Mr. J. Grimond (Orkney and Shetland)

I should like to extend my sympathy to the relatives of those fishermen who lost their lives in this tragic accident. This will always be a risky and dangerous way of life, and we have to weigh that against the comparative success to which the Secretary of State was able to point in 1963. It is encouraging that the total income of the industry has gone up by £2.3 million, and that there has been a further increase in the income over the first five months of this year. But it remains a very risky enterprise.

I was also glad to hear that the Government attach the greatest importance to the conservation of stocks, because this is a matter of abiding concern for the whole industry. I was also glad to hear the right hon. Gentleman speak about the importance of marketing. I, too, hope that we shall hear a good deal more about the proposal of the White Fish Authority to improve the marketing of fish. This is of particular interest to my constituency where the industry is always short of outlets and where unfortunately, as mentioned in paragraph 56 of the White Fish Authority's Report, the selling scheme which the Authority helped to put into operation came to an end early this year.

There were reasons for that, but I impress upon the Government that, certainly in Shetland, far from the main markets, this question of outlets and marketing is still of great concern. So for that matter are packaging and the presentation of the fish to the consumer and all the related problems of transport and freight.

I should also like to draw attention, in passing, to paragraph 59 of the Report, where it is stated that £75,000 was spent on publicity. This sum was divided between Press advertising, point of sale material and educational activities. It has been pointed out in previous debates on fishing that this sum, though considerable, is quite inconsiderable when compared with the amount which any major firm would spend on advertising. I see the difficulties of the Authority, with its limited budget, but I urge the Secretary of State for Scotland once again to look into this matter. I believe that this appropriation should be greatly increased.

I do not think that this country yet realises what an excellent and cheap food fish is. A great many people in this country have never eaten fresh fish. A great deal of expensive fish is sold in London which, in the fishing ports, would be almost condemned as bad. There is an enormous, untapped market, and especially in view of the rising price of meat there is all the more reason for increasing appropriations for advertising and promotion.

I am also interested, as far as Shetland is concerned, in the possibility of expanding the fishing fleet and in the attempts which we have been making to bring industry into Yell, for instance, and to keep the population of the island. We have had numerous discussions on bringing fishing to that island. This requires piers and it requires facilities, but I believe that fishing is one of the great hopes of the north of Scotland. This is an area where, now that the limit has been extended, we can tackle the question of conservation of stock and where, as the hon. Member for Banff (Sir W. Duthie) has said, there is almost a revolution in the fishing industry as a result of the new methods that are being adopted. I regard the industry as one of the more fruitful lines of development we could possibly have in Scotland.

Last year, I raised the question of trawling for herring. I know that this is a matter on which the hon. Member for Banff spent a great deal of time, and that there is an interesting passage on pages 33 and 34 of the Report of the Herring Industry Board about trawling experiments. I was struck by the fact that although these are interesting experiments the Board itself admits that insufficient time was spent in the Shetland—Buchan area to provide thorough tests of the full potentialities of mid-water herring trawling. I know that there are objections to trawling, although it might well be that if everybody behaved in a thoroughly rational way and restrictions were applied it would be acceptable. This is a type of method, however, which is inevitably used by foreign vessels and we have to come to terms with it, and I know that experiments are going on with trawling and other methods of catching herring.

Now, one or two questions about the Measures themselves. As I say, unfortunately the outlets for fish in Shetland are limited, and for one outlet at least we have to rely on sending fish for oil and meal. I see that in the Herring Subsidy Scheme, paragraph 2(2), there is a slight alteration in the wording. The words now are if the appropriate Minister is satisfied that the said herring could not have been sold for purposes other than…conversion". I do not think that these words appeared in the old Scheme, and I wonder why they have been put in here.

There is an alteration also in Schedule 2 to the White Fish Subsidy Scheme in which are listed the rates of grant applicable to various kinds of fish. The first category of fish is all whole gutted fish, and then we have the classes of ungutted fish which among them include the whole range of ungutted fish. The final category is all other whole fish of a kind normally sold for human consumption". On this category the rate of grant is 6d. per stone, and I think that this is fish sent for oil and meal. In last year's Scheme the phrase normally sold for human consumption did not appear. Again, I wonder why these words have been put in and what is said to be their effect.

Like other hon. Members, I certainly could not oppose these Schemes. The industry will be most grateful for the help which is being given to it, but there are the long-term problems which I have mentioned—conservation, marketing, transport, promotion, and keeping our fleet up to date in relation to developments in the rest of the world. Whenever I go to my constituency, I am struck again and again by the size and power of the foreign fishing vessels one sees now in our ports, enormous steel vessels of a size and capacity very different from our older inshore vessels, some of them going back almost to the days of the "Fifies".

Sir W. Duthie

And the "Zulu".

Mr. Grimond

Yes, and the "Zulu", which did us very well.

This is a continuing problem. Grateful though we are for the subsidy, let us not think that the industry can now be left to look after itself. It faces great difficulties because of its small units, family crews, and so on, and it has to compete every day with the heavily subsidised very powerful fleets which are coming in fairly close to our coasts and catching enormous quantities of fish in the North Sea.

9.18 p.m.

Sir Cyril Osborne (Louth)

My only reason for intervening in the debate is that most of the fishermen in the Grimsby area live in my constituency and I wish to put some questions and make one or two remarks on their behalf. First, it should be said that two years ago certain sections of the Grimsby industry felt that they faced bankruptcy, and they have said to me more than once that they are very grateful to the Government for the help and consideration given to them. I feel that this should be put on record. However, like Oliver Twist, they are never satisfied and they wish to warn the Government of what can happen. They have had a year and a half of good trading after many years of very bad or disastrous trading—I am speaking particularly for the family businesses—and they do not want the Government to assume that all their troubles are over and that they can be left where they are.

I support the plea made by the hon. Member for Edinburgh, Leith (Mr. Hoy) about the Matthews report. I understand that the Government have had Mr. Roy Matthews' report since October last year, a report covering the total reorganisation of the industry and taking a very broad view. Can it be published in its entirety? So far, the Minister has been good enough to give us a bit here and a bit there from it, but he should realise that if he does this he leaves the impression in the minds of people in the industry that something else has not been revealed and, quite naturally, the fear is aroused that what is left out is rather more important than what is disclosed. The Government may be doing themselves a disservice by not publishing all the proposals. I beg my right hon. Friend to consider this point and to see whether this can be done in the near future.

Secondly, I have been requested to ask questions about the consequences of loans and foreclosures. My right hon. Friend will remember that two years ago a moratorium was given to companies which were almost facing bankruptcy. That moratorium ends in September this year. As the hon. Member for Leith said, the arrears of loans have increased from £1,250,000 to £1,550,000 in a period when the industry is supposed to be doing a lot better. This must mean that certain companies are doing much worse and are losing money.

It is fair to ask—and members of the trawling industry want to know—whether it is the Government's intention to foreclose these vessels which fall in arrear and what they propose to do with them. I understand that already about six from the North-East have been taken over and foreclosed by the Authority and are being run by the Authority at a loss. The industry would like to know how much the Authority is losing on these vessels. If it forecloses and takes over many more of these vessels which are in arrears of payment, will it continue to run those at a loss? If it does, this seems quite unfair competition to the industry. Those are the two main points which I have been asked to put.

On the question of capital grants, the section of the industry for which I am speaking is a little concerned about the 50 per cent. grant which will be given for experimental purposes and the 25 per cent. grant for improvements. It wants to know how there will be demarcation between the two. Would it not be better to pay 33⅓ per cent. for the whole lot, which would cost no more money and would stop all sorts of difficulties in the industry?

I have been asked to say this about the supplementary subsidy. The maximum of £½ million for 10 years does not seem a lot. But that is not what is worrying the industry. The maximum for any one year is £350,000. This goes only to vessels which are in financial difficulties. But £350,000 for all the vessels which could be in difficulties in a bad year would be totally inadequate. Therefore, without requesting that the total of £2½ million be increased—although we should like that if it could be done—may I ask whether the £350,000 could be increased in case the industry strikes a very bad period, as it did two years ago?

The loans which were given on favourable terms to the smaller concerns for the smaller vessels have been a godsend, and the owners are very grateful. However, as I understand it, the terms of these loans for the cheaper money exclude the bigger companies, which must borrow, if they can, at commercial rates. Commercial rates can mean almost anything, and the bigger companies could be pushed into paying 8 or 9 per cent. Surely this is not good for the industry and is not what the Government want. Could the loans be made available to the larger as well as the smaller companies?

Lastly, I want to deal with a matter which affects my constituency very closely, namely, the loss of the fishing grounds round the Faroes. The industry in Grimsby has been very badly hit by this, and we want to know whether the Government can do anything to help. As the Minister knows quite well, these grounds have been lost as a result not of agreement and discussion but of unilateral action.

We had a lot of trouble and disagreement with Iceland years ago, but finally agreement was reached. The Faroes, as I understand it, have acted completely unilaterally, and as a consequence the industry fears that the other nations in the north will follow the example of the Faroes and that the Grimsby trawling industry will lose a good deal more of its best fishing grounds. I am asking the Minister to use his good offices to try to help to solve this very difficult problem and to help this section of the industry for which I am speaking.

The hon. Member for Edinburgh, Leith said that he hoped that the consumers'end would be looked at and he talked about the Faroes and what the fish fryers had to say. This affects my constituents and I appeal to the Minister on this issue. Because of the action of the Faroes there was a committee formed in Grimsby. It consisted of representatives of the trawler owners, the trawler officers, and the Transport and General Workers' Union. They made a mistake, I think, in not including the merchants originally. They discussed with the merchants later, but I think that the committee made a mistake originally in not including the merchants.

I put it to my right hon. Friend that last year fish from the Faroes and landed in this country amounted to £1,200,000 worth. No less than £641,000 worth came to Grimsby. This is, therefore, of vital importance to my constituents, especially when this is compared with the total value of the landings for the whole country, £63 million, of which £13 million came in foreign vessels. The Committee, to safeguard our own fishing position, argued for a cut-down of imports from the Faroes to the average of the last ten years of £850,000 per annum.

It is on this that the Grimsby Trawler owners have been wrongly attacked in the Press from the consumers point of view. It has been said in a leading article in the People that prices were sky high, and that this was an iniquitous thing to do. I put it to hon. Gentlemen opposite that if the products of a man's labour are sold too cheaply he cannot be paid a fair wage. The price of coal has been put up in order that the miners may have a better wage. This same argument ought to apply to the men engaged in the fishing industry. If it is fair for coal miners it is fair for the chaps in the fishing industry. It is nonsense for papers like the People to scream their heads off as they have. There was a great article in the People attacking the Grimsby end of the trade and saying that the fish fryers were saying that our section of the industry was holding the fish fryers to ransom. It is just nonsense. It is not right for industrial workers averaging £17 a week to demand cheap food from men earning a good deal less in the fishing industry.

The Minister, I know, when seen by members of the industry, has said that he has no legal responsibility in the matter of the Faroes. I think he has got a moral responsibility. I want my right hon. Friend to help the industry to get the Faroes people to come and discuss with the British industry the various problems which arise and to see whether the ban, if I may call it that, on the imports into our country cannot be ended as a package deal against our having better rights in their fishing grounds.

Those are the comments which I have been asked to make. People in my constituency are grateful for what has been done for them, but they do not want the Minister to run away with the idea that everything is all right for the future and that he can leave them alone.

9.30 p.m.

Mr. Patrick Wall (Haltemprice)

I join with those hon. Members who have expressed their condolences with the families of those who lost their lives in yesterday's disaster. I understand that the vessel concerned came not only from the constituency of my hon. Friend the Member for Banff (Sir W. Duthie), but from his own village, and that some of those who lost their lives were distantly related to him. I hope that he will convey to those concerned the personal condolences of the whole House when he next visits his constituency.

When my right hon. Friend introduced these Schemes, he referred in some detail to the background against which they should be discussed. I think that we should consider the background in some detail. When I was doing a little research this morning for this speech, I happened to come across the British Trawler Federation's Report for 1958. I will quote the first two paragraphs: The year 1958 was one of continual anxiety for the British Distant Water fleets sailing out of Fleetwood, Grimsby and Hull. The Conference on the Law of the Sea and the subsequent action of Iceland in endeavouring to take for her own exclusive use large areas of the high seas laid a shadow over the industry which has not yet been dispelled. Large investments in trawlers and the well-being of countless fishermen and their families are threatened; indeed, the threat goes much further than this, the livelihood of whole communities is in jeopardy. What a great contrast there is between that report of 1958 and the whole industry's position in 1964!

There has been a gradual improvement in all the past years. In 1959 we were at the height of what was called the cod war with Iceland and in that year the E.F.T.A. agreement was signed. In the following year we had a relapse, as it were, in the failure of the Geneva Conference, but at least the Geneva Conference showed that most nations would agree to a fisheries limit of about 12 miles. Then came the truce with Iceland and the agreement with Norway and the introduction of subsidies for the distant-water vessels. In the same year, the concept of a Western European fisheries convention was outlined.

In 1961 came the Fleck Committee's Report, which committee, the House will recall, was set up in 1957. The Government accepted that Report and it has been the agreed foundation for the reconstruction of the industry. It is of interest to note that the Fleck Report was published completely and that the Government then published a White Paper giving their proposals on its implementation. I think that the House would be grateful if the Government would do the same thing, in a less ambitious way, for the proposals recently submitted by the Chairman of the White Fish Authority. If we could have these proposals produced rather like the Fleck Report was produced, with the Government's views on those proposals set out in a White Paper, the House and the country would be able to judge exactly what was proposed for the immediate future. I believe that the Government would do themselves and the White Fish Authority a good service by following the example of what was done with the Fleck Report.

In 1961 there came the final agreement with Iceland and the extremely important concession that any future possibility of extending limits must be referred to The Hague Court.

In the following year, the House passed the Sea Fish Industries Act which gave full effect to the Fleck Report. Last year we were faced with the failure of the Common Market negotiations. Whatever one may have thought about that personally, it was a blow to the fishing industry.

Mr. Frederick Peart (Workington)

Did the hon. Gentleman say that if we had gone into the Common Market the industry would have gained thereby?

Mr. Wall

I did. Without debating the pros and cons of going into the Common Market, it would have been a gain to the fishing industry. The industry itself openly admitted this during the long discussions on the matter. The industry would have gained because there would have been a common agreement for fish to enter Europe, and we would have had a fusion of catching agreements.

This year we had the Western European Fisheries Convention which flowed from many of the developments about which I have just reminded the House. From that conference came a convention and a code. This code was to be decided at a meeting of technicians from the various nations concerned. I do not know whether the Minister can tell us what has happened about that meeting. Has it taken place, and with what result?

Then, only a few weeks ago, we had the Fishing Limits Bill which has done so much to improve the lot of the inshore fishermen. Six months ago we contributed to what the White Fish Authority called a revolution in the catching side of the distant water part of the industry by making available a grant of £110,000 for freezer trawlers. Now we have an extension of that in the grant Scheme before us.

This is an excellent record and I think that I am right in saying—perhaps my right hon. Friend can confirm this—that since 1951 about £40 million has been given in subsidies—not in loans—to the industry. I congratulate my right hon. Friend and his immediate predecessors on all that they have done to modernise the industry and to change the picture from the rather dreary one reported in 1958.

As the hon. Member for Edinburgh, Leith (Mr. Hoy) pointed out, these Schemes not only reduce the subsidies by 7½ per cent., but give a total reduction of 15 per cent. I was not clear whether he thought that that was good or bad. It is true that this can be done. Every hon. Member who has spoken so far has accepted that this reduction in subsidies is justified. Indeed, it has been agreed to by the industry. The fact that we can reduce subsidies by 15 per cent. and that the industry accepts it, surely must be a considerable move towards the end that we all have in mind, namely, an efficient, prosperous industry that is not subsidised.

Mr. Hoy

I had better put the hon. Gentleman right. I made it quite clear that I did not agree. If he wants further support for my point of view, he should read the speech of his hon. Friend the Member for Banff (Sir W. Duthie) who said that to talk about phasing this out was nonsense. That is what I think about it, too.

Mr. Wall

My point is that the industry is assisted by subsidies, and the fact that this year we have managed to reduce subsidies by 15 per cent. with the agreement of the industry must be satisfactory to all concerned. I agree with the hon. Gentleman and others who have said that it is far too early to tell whether we can tail off the subsidies as planned. We have done so this year, and the industry has accepted it, but it is too early yet to say whether this can continue year after year.

What has happened is that we have had a good catching season after two bad ones which necessitated a moratorium. That is why the firm referred to by my hon. Friend the Member for Louth (Sir C. Osborne) is still in debt. One hopes that if it prospers this year and next it will be able to pay off the arrears and we will get an efficient, prosperous industry without the shackle of subsidies.

The distant-water section of the industry based on Hull never wanted subsidies. It accepted them largely because of the effect of external happenings, such as the closing of traditional fishing grounds by unilateral action of foreign countries. I believe that the grants which supplement the increased grants given for new freezer trawlers only six months ago will do a great deal to improve the efficiency of the industry. The fact that they are extended to cover increases in economy and efficiency of operation, and such matters as handling, processing and storage of fish, will be of great assistance and will lead the industry to experiment and improvise.

I understand that this covers the conversion of traditional trawlers to freezer trawlers and is obviously a useful supplement to previous legislation. I am also pleased that my right hon. Friend managed to announce today that a further £500,000 is available to supplement the £2 million for these grants and that a whole review of the whole grants policy will be brought forward to the latter part of this year. This will be of considerable interest to the owners, who obviously have to plan their rebuilding programmes years ahead. I ask my right hon. Friend to give me this information, off the cuff, if possible. Can he tell me what is the total estimated cost, in this financial year, of the grants which are designed to assist in the building and modernisation of vessels?

I now turn to the question of loans which was dealt with by my hon. Friend the Member for Louth. I have two points to underline. The first concerns the arrears—now £1½ million—on loans from the White Fish Authority, which is an increase of £250,000 on last year. What is to happen about the moratorium? Will it continue? What is the policy about foreclosure? Does foreclosure mean the sale of trawlers, possibly at a loss, or that the White Fish Authority must continue to be vessel operators. I note that in paragraph 15 of its Annual Report it says: we have also found ourselves involved in the unwanted and unwonted rôle of vessel owners. I am glad to see that the hon. Member for Leith appears to disapprove of this. I am sure that we would all agree that it would be a pity if the White Fish Authority became operators or owners. It might mean the first step along the road to the nationalisation of the industry, which is so dear to certain of his hon. Friends.

The other point also mentioned by my hon. Friend the Member for Louth is the question of loans by the Authority which at the moment are confined to those who cannot borrow at commercial rates of interest. It means that these loans are restricted to the smaller companies. I would remind my right hon. Friend that in paragraph 17 of the White Fish Authority's Annual Report it says: The rule would seem to operate unfairly as regards large companies, since it puts them at a competitive disadvantage with their smaller rivals and furthermore it forbids loans of public money from being made where the security is safest. I hope that my right hon. Friend will consider this in some detail and will be able to accept proposals which have been made to him, which were that the phrase unable to raise loans at commercial rates of interest should be replaced by something like "cannot borrow on the open market at rates of interest not more than 1 per cent. above White Fish Authority rates." That would bring into effect what Parliament had in mind when it last discussed these matters, and it would be approved both by the industry and the Authority.

I now come to the new proposals of the Authority. Paragraph 4 of its Report talks about the emphasis being laid on the encouragement of enterprise and innovation and flexibility in the administration of aid to the industry. I am sure that we all support it in this idea. I join with many other hon. Members in congratulating Mr. Roy Matthews on his leadership. His ears must be burning if he has been listening to this debate. I believe that he has already produced new ideas and that he is now the recognised leader of an industry which is keen to obtain greater co-operation under his leadership. Now that his Report has been made to the Government who have in broad outline discussed it and, so far as one can see broadly approved it, one hopes that the industry will be able to get ahead with planning better coordination and co-operation.

It is clear from what has been said in this debate that there is at present no case for greater Government support for the industry. It is also clear that there are several pros and cons about a minimum price scheme which in any case already covers something like 80 per cent. of the industry. Obviously better quality is needed particularly by the consumer and by the distributive side of the industry. Equally, one does not want to see the price to the housewife go up. The Government are taking a rather neutral attitude on this and we hope soon to hear from the White Fish Authority and from the industry detailed proposals about the possible future introduction of a statutory minimum price scheme.

My final point on the question of coordination of the industry relates to the Faroese quota. This has been referred to by my hon. Friend the Member for Louth. I do not want to labour the matter, but I wish to underline that the reason for the imposition of a quota was the unilateral action of the Faroese. The Committee which was set up included all major sections of the producing side of the industry including the trade unions, and not only the B.T.F. It has done its best to obtain co-operation from the Faroese. It asked for observers and for further talks, but has received no reply from the Faroese industry or Government. It is obvious that eventually there must be talks and eventually there must be some agreement both over the quota and over fishing rights. Obviously, both sides must come together as, finally, we had to do with Iceland. Let us hope that this will not take a period of four or five years as was the case in respect of the negotiations with Iceland. The more the various sections of British industry remain together on this issue the more likelihood there is that we may reach agreement with the Faroese.

Sir C. Osborne

Would my hon. Friend agree that this should include the merchants as well as the producers?

Mr. Wall

Yes, I agree with that. I think that the merchants should be included. That is why I say that now that the White Fish Authority proposals have been got out of the way, or perhaps I should say brought into the open, Mr. Roy Matthews will be able to go ahead with talks with all sections of the industry. This may lead to disagreements, but basically I think that such talks would do a lot of good. I think that a lot of good came out of talks held by the Joint Parliamentary Fisheries Committee last year to which reference was made by the hon. Member for Leith.

This is probably the last debate on the fishing industry that we shall have in this Parliament. The Government have an excellent record on fishing matters. I believe that these Schemes will assist the completion of a modern and efficient fishing industry. They have the support of the House and the enthusiastic support of hon. Members on this side as they represent the completion of a job really well done.

9.48 p.m.

Mr. Frederick Peart (Workington)

We on this side of the House support these orders. I am not sure about the hon. Member for Haltemprice (Mr. Wall). When we had a brief debate on sea fishing limits I was able to congratulate the hon. Member on having made an effective speech. Tonight, he has made a most ineffective speech. I have never heard such nonsense talked in a fishing debate, especially when he referred to the Common Market.

What the hon. Member said is all very problematical. Nothing was agreed by the Community about a policy. We cannot have an efficient policy unless we consider other countries including the Scandinavian countries, and the hon. Member for Haltemprice referred to the Faroese. It is a matter which we must look at again. Consultations must take place. We cannot consider a policy in terms of "little Europe". I will not pursue the matter. The hon. Gentleman has made his point and I think that it will be rejected.

Mr. Wall

I do not think that the hon. Member understood the point which I made. He said that we should consider these things on a European basis. We must consider them on the Common Market basis and markets for fish together with access to fishing grounds.

Mr. Peart

The hon. Member obviously did not understand the point he himself made, because he has now altered his argument and taken up the point I made. We cannot think in terms of a Common Market approach, but the fishing industry has to consider E.F.T.A. and other countries not in E.F.T.A., Poland and the Soviet Union. The right hon. Member for Orkney and Shetland (Mr. Grimond) mentioned in a previous debate the importance of the Soviet fishing fleet in relation to entry to this country.

However, I shall not pursue the argument. The hon. Member made a stupid remark when he said that subsidies shackle the industry. That was the phrase he used—the shackles of subsidies. His right hon. Friend—not the Minister of Agriculture who is a crypto-Socialist, but his right hon. Friend the Member for Wolverhampton, South-West (Mr. Powell)—has a new recruit. Carry on with this extravagant language and I am sure it will be welcomed in certain right-wing Tory circles, but they would not dare to do this in the agricultural industry.

The hon. Member for Banff (Sir W. Duthie)—who spoke sensibly because he knows the industry and we all listened with care to his contribution—mentioned that subsidies from 1951 had amounted to £41 million. They have not been large in relation to the importance of the industry. Let us keep this in its right proportion. To talk about shackles of subsidies is nonsense. We are anxious to have subsidies properly used in the industry. When we had the major debate on the Bill which has created these Orders, I remember making a speech. I have it here with me, but I shall not weary the House with quotations from my speech.

Dame Irene Ward (Tynemouth)

Thank goodness.

Mr. Peart

I am glad to say to the hon. Lady that it was a better speech than that made by the hon. Member for Haltemprice, who had a strange brief this evening.

My hon. Friend the Member for Edinburgh, Leith (Mr. Hoy), who spoke first from this side of the House in this debate, and I time and again on the Committee stage of that Bill argued that the Government can be too optimistic about creating a viable industry over a 10-year period. Even the Fleck Report suggested this. The hon. Lady the Member for Tynemouth (Dame Irene Ward), who represents a very important fishing area on the North-East Coast, would I think agree that we should not be dogmatic. While we may argue about the phasing of subsidies it would be very wrong to be dogmatic. I am glad to have support in this connection of the hon. Member for Louth (Sir C. Osborne) in saying that these subsidies are an attempt to provide a springboard for the industry. They are not there to shackle the industry. This is a combination of public good will on the part of a Government which has had to be prodded from time to time and various public authorities in the industry such as the White Fish Authority to inject capital into the industry so that proper structural arrangements could be made.

When the hon. Member for Haltemprice talks about nationalisation in the industry he is being silly. Here we have a desire on the part of every hon. Member who cares for the industry to have proper State aid for the industry. The White Fish Authority is a vital part in this development. It is a public authortiy which, in partnership with the industry, seeks to provide a prosperous industry. Let us not be doctrinaire about this; let us be pragmatic and not make silly pronouncements. We do not oppose these Orders. We are anxious to give the aid and see that it works well. We are anxious to see the industry prosperous.

I know it is a cliché, but it is true to say that this is a very important food producing industry. It is vital to the nation. It provides a livelihood of those engaged in catching fish, for those engaged in processing fish, and for those in the distributive trades. It is also very important from the point of view of defence. It provides the basis of a school of seamanship from which we can draw recruits for the Royal Navy and for the lifeboat service. We do not want to be dogmatic, but we are anxious to see that aid is rightly used, and that the industry becomes more viable. We wish it well.

I should like further explanation of the £50,000 mentioned by the Minister. I understand that this is to cover research into marketing, etc., but perhaps the Secretary of State will elaborate on this point. It may be that I have a bee in my bonnet about scientific research. I know that during the Committee stage of the Bill I tried to move a Clause to create a new research council, and I still think such a council to be fundamental to the industry. We need more research and more co-ordination. What the Fleck Committee reported on this I believe to be still true. I agree with the right hon. Member for Orkney and Shetland that £75,000 for publicity is not enough in view of the importance of the industry.

I want to stress the importance of the report submitted to the Government by Mr. Matthews, Chairman of the White Fish Authority. I pay tribute to Mr. Matthews. He has been brought into the industry, and I am certain that a man of his vigour and outlook will inject new life, not only into the industry but into the Government.

Hon. Members on both sides have expressed the desire to know more about Mr. Matthews' proposals. The Minister has told us of some of them, but we want the whole story. An isolated proposal, often taken out of context, does not give a clear picture. If possible, hon. Members would like to look at all the proposals that have been made, which could well form a new charter for the industry. Does the Joint Parliamentary Secretary wish to intervene? Apparently not. I thought that he was dissenting from this point of view. If the hon. Gentleman is speaking in his sleep, I do not mind, but he should realise that hon. Members on both sides feel deeply about this important matter. They want to know what proposals have been made by the chairman of a very important public authority. There may be difficulties about publishing the proposals as a White Paper or in some other form but, if it can be arranged, publication will be for the good of all.

We on this side support the industry on the question of import control on which the trade unions and the employers have agreed because of the unilateral action taken by the Faroese. I agree with the hon. Member for Louth that the consultations should have been much wider. When we will get a solution of the problem, I do not know, but it must come. We cannot be xenophobic about it. We need an agreement, and there must be negotiation. At the same time, we support the attitude of the trade in this matter.

As I say, we on this side are not dogmatic, we hope that the industry will be viable, we are anxious to know the details of the memorandum that has been submitted, and I have mentioned the marketing and research that are very vital to the industry. On all these matters, perhaps the Minister will be able to give me a satisfactory reply.

10.0 p.m.

The Secretary of State for Scotland (Mr. Michael Noble)

As usual, tonight's debate on fishing Measures has ranged fairly widely. I will try to wind up as quickly as possible, because, though we started some hours earlier tonight than I can remember other debates of this sort taking place, I know that the House does not want me to make a long speech.

My right hon. Friend the Minister of Agriculture, in referring to the results experienced by the industry in the United Kingdom as a whole, mentioned that in Scotland the figures for the last period had been particularly good. He talked about an increase of 7 per cent. The corresponding figure for Scotland was 101/2 per cent. This includes both white fish and herring. Though herring fishermen have not been doing as well this year in Scotland—I know that one or two of the herring fishermen in my own constituency have not been getting very rich in the last month or two—leaving herrings out of this, the increase in the white fish returns has been 14 per cent., twice as good as the U.K. figure, and the value of the Scottish trawler catch was up by 23 per cent.

I know full well that one cannot say that this is bound to continue. It was not for nothing that my first public meeting in Argyll, was addressed by, I imagine, a very distinguished expert from the Department of Agriculture and Fisheries, who came to tell us that for certain reasons there never could be any more herring in Loch Fyne. The next summer one could walk across Loch Fyne on the herring—they were absolutely solid. Therefore, I realise the dangers involved in either experts or Ministers trying to forecast. I also realise that when figures are given of increased catches attention should also be paid to the increasing costs in the industry, which have an effect on profits.

I turn to some of the points raised during the debate. The hon. Member for Edinburgh, Leith (Mr. Hoy) is right in thinking that the changes in the phraseology of these Statutory Instruments have been made to try to bring the two Statutory Instruments more closely together. The change in the 24-hour rule was made because fishermen, like some other people, were aware that if one happened to go out a few minutes before midnight on one day and stay out until a few minutes after midnight on the following night, one was able to get more subsidy out of the Statutory Instruments than Parliament ever intended.

I agree with the hon. Gentleman that the phrase to which he took some exception last year in relation to fishing diligently was unnecessary; it has been removed. If the fishing at a given moment in any area is dull and there are no fish there, it is difficult to tell whether the man who is casting his net there is fishing diligently or not.

I do not want to start a debate on the importance of "may" and "shall", though we have had many such arguments in Scottish debates, particularly in Standing Committee. The detailed change in the Herring Scheme was made to bring it into line with the White Fish Scheme and there is no more sinister purpose than that. The question of the length of vessels is also one on which I receive a number of letters from my constituency saying, "Because my boat is 39 ft. 6 ins. it is subject to different rules and regulations than if it were 40 ft." Therefore, this provision is in, so that it is not possible merely to add on a piece of wood and then say that the boat is of a different size.

The hon. Gentleman asked me, as did one or two of my hon. Friends, whether the White Fish Authority was likely to find itself owning a large number of vessels because of foreclosures; whether, if the Authority was not going to own them and operate them itself, it would want to sell them either at home or abroad; and, if so, who would pay if the Authority sold at a loss? The brief answer is that if the White Fish Authority became unwillingly—I say "unwillingly" because the Authority does not want to take over vessels under these conditions—the owner of a vessel it should have the power to discuss with my right hon. Friend and myself, in each case, whether it is better to sell the boat to a buyer at once, or whether, if the market is slack, it should be allowed to fish for a short time and sell the boat later for a better price—perhaps a month or two later.

Sir C. Osborne

When my right hon. Friend says that the Authority should fish with the vessel for a short time, can he say what he means by "a short time", because if the Authority can run vessels even at a loss, with the taxpayers' purse behind it, that will be unfair competition against the people in the industry who are running vessels at their own expense. It is important, therefore, to know how long this competition will last.

Mr. Noble

It is difficult to answer with certainty, but it must be left to the judgment of the Authority, my right hon. Friend and myself to say for how long this should take place, because if the Authority sells the boat—and we must remember that we are talking about a very small number of boats; from memory, I think only two or three out of 500 or 600 in the fleet—at a loss, the taxpayer will lose a considerable amount of money that way.

The hon. Member for Leith and several other hon. Members suggested that because the amount of the debt to the Authority went up last year by £300,000, that must indicate that the industry was worse off than a year ago. That is not true, because we gave the industry a two-year moratorium, and if people have decided not to pay back their debts this year—for good reason, no doubt—that is the reason for the increased debt. I am told, however, by the White Fish Authority that the indications are that a considerable number of people will pay their debts and it is certain that the results this year will mean that a great many more debts will be paid in the autumn and the spring.

Mr. Hoy

What about the bad debts?

Mr. Noble

I do not have the figures for bad debts, but I think that the hon. Member also asked whether, if there were any bad debts, the Government would pay them or whether they would have to come from the industry. The answer is that if they exceed the amount the industry is making available for bad debts, then I believe that they will fall on the Government.

The hon. Member for Leith also asked whether payments would be made for boxing fish at sea. This, he said, was a problem which had arisen in or near his constituency in the old days and he wondered whether it would come within the extra money we are making available to the industry for improvements. The answer is, "Yes".

The hon. Member then asked a question which was asked by almost all hon. Members: whether my right hon. Friend would publish the Report which Mr. Roy Matthews made some months ago. There seems to be a misconception about that Report. It was not a report like the Fleck Report, made after years of consideration. I would like, if Mr. Matthews will not consider that his blushes are being brought too readily to his face, to say how frequently we have met and how very much I have appreciated his vigour and the ideas that he has produced. His Report was made after a quick tour of the ports and it covered a wide variety of subjects, almost all of which my right hon. Friend dealt with. I would consider it entirely wrong if the Chairman of the White Fish Authority felt that he could not send reports to my right hon. Friend and myself at regular intervals without there being demands in Parliament for them to be published. This Report was made specifically for us and—

Mr. Hoy

Not a single hon. Member has made that request. We understand that Mr. Roy Matthews, on behalf of the White Fish Authority, made certain proposals. If he had said, "I do not want the House of Commons to know about these," that would be a different matter. Perhaps the right hon. Gentleman will clear up this matter with Mr. Matthews. I take it that if Mr. Matthews says that he has no objection, the Minister will make the proposals available to us.

Mr. Noble

I am certain that the hon. Member, who I am sure knows Mr. Roy Matthews very well, will be able to take him out to dinner and to find out all he wants to know about it. There is nothing secret about it, but it is entirely wrong that suggestions of this sort, whether in the form of proposals or in any other form, should be the subject of publication as a White Paper.

My hon. Friend the Member for Banff (Sir W. Duthie), whom we always enjoy hearing in fishing debates, has taken a particular interest in the subject for many years. He brought to what is perhaps his last fishing industry debate in the House the story of the tragedy of the seine netter "Sirius". I join with what has been said in the House, and I hope that he will convey my sympathy, as well as that of the rest of the House, to the fishermen and their relatives.

I was not surprised to hear that he has visited practically every English port and has even been to Germany to see whether there is anything new, because he has always been very keen on research and on finding out more and more about the problems which the fishing industry encounters. He asked me specifically about the price of herring for oil and meal and whether the price would be for the whole catch. I am sorry to have to disappoint him, but it cannot be for the whole catch; as last year, it is for 20 per cent of the whole catch only. It may be some slight comfort to him to know that by some curious method—I should not like to try to find out too accurately how it happened—out of 59,000 crans which were sent for oil and meal from Scotland, 40,000 crans seemed to attract subsidy.

My hon. Friend referred to the Ullapool blunder, and we have spoken about that in the House before. I have complete confidence that Sir John Carmichael has taken the necessary action to make certain that this will not happen again.

The right hon. Member for Orkney and Shetland (Mr. Grimond) spoke of the importance which my right hon. Friend and I and Mr. Roy Matthews all certainly attach to marketing, packaging, transport and freight. He said that he did not think that the total sum of £75,000 for publicity in the White Fish Authority accounts was enough. My right hon. Friend and I entirely agree with him. Where we find some difficulty is that in every industry of this nature—wool or any other product—the money for advertising comes from the industry and not from the Government. If the results which we are recording this evening, which are getting steadily better, continue in the future, I very much hope that the catchers of fish will be prepared to give a more adequate amount to the White Fish Authority for this purpose, because in modern terms any major scheme of promotion costs several times the amount which has been mentioned.

The right hon. Gentleman referred to the phrase in the Schemes that the Minister must be satisfied that herring sent for meal could not have been sold for other purposes. This is a proper safeguard in a Scheme of this sort to ensure that fishermen do not send to the oil and meal factories herring which could be sold more profitably for some other purpose. He also asked me about the phrase fish normally sold for human consumption. This is to cover some industrial fishing. Not a great deal of it is taking place yet in Scotland, although it is beginning, but it is becoming very important in Europe where they are catching large quantities of sand eels and something called gobbets, which they find profitable. In our view, these should not get the subsidy.

My hon. Friend the Member for Louth (Sir C. Osborne) asked a great number of important questions and I will try to deal with them as quickly as possible. He asked about the 50 per cent. experimental grant and the 25 per cent. improvement grant and whether we could have a 33⅓ per cent. grant on each. Our view, and I am sure that it is shared by the White Fish Authority, is that 50 per cent. grant should be given for experimental purposes to specific vessels, and that only when the experiment is proved successful should that feature be incorporated in other vessels and get the 25 per cent. improvement grant there.

My hon. Friend asked about Supplementary Estimates. We all hope that we shall not have to exceed the maximum of £350,000, and, indeed, it could not be increased without specific authority from the House. My hon. Friend also asked about loans for smaller vessels and whether they could not be given to the large firms. I do not think that that is desirable. If a large firm is in a development district it may qualify for a loan but this is essentially something provided for the small firm which has not the access to the facilities for loans which most of the big companies possess.

I think that the House would agree with him that it would be very pleasing if we could make arrangements over the Faroes which would prevent ill-feeling and difficulties which not only Grimsby has suffered but also particularly Scottish trawlers from Aberdeen and Granton. This is not easily done and my right hon. Friend did his best with very tough negotiations not long ago.

Sir C. Osborne

This is important to Grimsby. If there is a chance to do something over the Faroes will my right hon. Friend promise to take it?

Mr. Noble

I absolutely promise that my right hon. Friend or myself will miss no opportunity of getting our foot in the door if it is at all possible.

My hon. Friend the Member for Haltemprice (Mr. Wall) was right, in spite of the comments made by the hon. Member for Workington (Mr. Peart), about the position over subsidies. I have lived a great part of my life with people in the fishing industry. They are tremendously independent and I do not believe that they want subsidies as such.

Mr. Hoy

Nobody said that they did.

Mr. Noble

There was a certain amount of banter which was getting confusing, but the hon. Member for Workington seemed to think that subsidies in themselves were necessary and good.

Mr. Peart

All I said was that I did not regard the subsidies provided by means of these Statutory Instruments as shackles, but as a springboard for further action to make the industry more viable.

Mr. Noble

I am glad that the hon. Member has said that they are to be used as a springboard to make the industry more viable.

I am glad that my hon. Friend the Member for Haltemprice welcomed the extra money for freezer trawlers. I think that this will be useful and perhaps will help to provide a new and better form of catching and marketing of fish. My hon. Friend also asked about the total figure for grants this year. Roughly speaking, it will be £800,000 for building vessels because the extra money will not be spent during this year. My hon. Friend was right in his estimate of about £40 million as the amount of money which has been given in subsidies.

In commending these Statutory Instruments to the House I would add that it is very easy to pick out 1961 and 1962 as two very bad years out of the last three. Looking back over the period to 1955, when we began to modernise our trawlers in Scotland with the new diesel trawlers, the years 1961 and 1962 are the worst two years in the whole of that time when the trawling fleet did not cover its depreciation and make a profit.

I am quite certain that, if we continue to have the advice of Mr. Roy Matthews, and if he is able, as my right hon. Friend said, to negotiate with the industry, with the trade and consumers satisfactory schemes for support prices and minimum prices, the industry may well be viable, as Mr. Matthews himself feels, within the period which the Fleck Report suggested.

Question put and agreed to.

Resolved, That the White Fish and Herring Subsidies (Aggregate Amount of Grants) Order 1964, dated 24th June, 1964, a copy of which was laid before this House on 2nd July, be approved.

White Fish Subsidy (United Kingdom) Scheme 1964, dated 2nd July 1964 [copy laid before the House 8th July], approved.—[Mr. Soames.]

Herring Subsidy (United Kingdom) Scheme 1964, dated 2nd July 1964 [copy laid before the House 8th July], approved.—[Mr. Noble.]

White Fish Industry (Grants for Improvement of Fishing Vessels) Scheme 1964, dated 6th July 1964 [copy laid before the House 8th July], approved.—[Mr. Soames.]