Costs

HC Deb 24 March 1965 vol 709 cc558-60

35. Mr. Scott-Hopkins

asked the Minister of Agriculture, Fisheries and Food if, in view of the increases in total costs to the agricultural industry during 1964–65, he will take steps to offset this added burden and ensure a higher level in real income to the industry so that the level of production can be maintained.

Mr. Peart

The Review award, together with the industry's increasing productivity, will more than offset the increased costs and give the industry the opportunity of improving its income. The award will, moreover, stimulate production where this is most needed.

Mr. Scott-Hopkins

I hope the right hon. Gentleman will accept that the industry will have to bear £19 million of the increased cost this year. How does he reconcile this with the promises which he made before and during the election that he would see that agricultural incomes in real terms would make a good advance?

Mr. Peart

As I have said repeatedly, there is no reason why the farmers' real income should not improve. Increased costs were taken into consideration, and agreed at £29 million. There was an increase in productivity worth £25 million, and a £10 million plus award, which means a real income increase of £6 million. There is no reason why efficient progressive farmers and good farmers should not increase their income. Added to that, we are giving aid to small farmers by various means, and also hill farmers in many upland areas.

Mr. Eldon Griffiths

Is the Minister aware that there is a feeling in the agricultural industry that it has been discriminated against, that whereas great increases of cost have been accepted in other industries in this country and their income increased, the farming industry feels that it is being uniquely discriminated against in this matter?

Mr. Peart

This is not so. [HON. MEMBERS: "Yes it is."] As the Minister responsible for food as well, I have met, in my Department's activities, all the food manufacturing industries in the various sections and I have insisted that there shall be no cost-plus increases. I believe that this must also apply to the farming industry. The farming industry is being asked to absorb a percentage of its costs. Of course this is right for every industry, and I am making no discrimination.

Mr. Bessell

Is the Minister aware that, in spite of his comments on the Price Review this afternoon, the farming industry as a whole feels that it has been grossly betrayed as a result of the election pledges which were given to the industry by the right hon. Gentleman and by his colleagues during the election campaign?

Mr. Peart

I cannot accept this. Here is a £10 million plus award, which compares very favourably with previous awards, where the farmer has an opportunity for an increased income, and, what is more important, the farmer has an indication of what will be the long-term policy for the industry to make the industry more efficient, more competitive and more aware of how productivity will increase.

Mr. Ridsdale

Is the Minister aware that it makes it very difficult, with the kind of profits which the farmers will be making in the future, to pay increased agricultural wages?

Mr. Peart

I really cannot accept that. I have repeated the facts, but hon. Members opposite, because of their political prejudices, will not accept them. I am sure that when sensible farmers read the White Paper and consider the issues, they will think that the approach in our Review is sensible and constructive.