AGRICULTURE (FERTILISERS SCHEME) (Hansard, 18 May 1965)

§ The Joint Parliamentary Secretary to the Ministry of Agriculture, Fisheries and Food (Mr. John Mackie)
I beg to move, That the Fertilisers (United Kingdom) Scheme, 1965, a draft of which was laid before this House on 14th April, be approved. This Scheme continues for a further year the fertiliser subsidy which the House has approved each year for more than 10 years. The main change this year is that the rates of subsidy have been cut to implement the decision announced at the Annual Review to reduce the subsidy by £2 million. Apart from this, there are only some minor changes in the Scheme itself which aim to clarify certain definitions, and to provide for points of detail that have arisen in the administration of the subsidy during the past year.
The cuts in the rates of subsidy amount to 5d. per unit for nitrogen, 4d. per unit for soluble phosphoric acid, and 2d. per unit for insoluble phosphoric acid. For grades of basic slag containing 14 per cent. or more of insoluble phosphoric acid, the reduction is 3d. per unit in Great Britain, and 4d. per unit in Northern Ireland. I should add that this still leaves the rate in Northern Ireland higher than that in Great Britain.
The overall reduction in the subsidy represents a little over 6 per cent. As in previous years, this has been spread over the nutrients in such a way as to represent roughly equivalent percentage cuts in each case. Again, in accordance with practice in the past, the rates for the lower grades of basic slag have been cut rather more heavily to avoid making bigger reductions in the higher grades which are the materials in greatest demand.
At the new rates the subsidy represents roughly the same percentage of the cost of the two nutrients—that is, a little over 30 per cent. For compounds, the percentage varies according to the relative amounts of nitrogen and phosphoric acid in them. The incidence of subsidy for most compounds is between 22 and 28 per cent. For all fertilisers taken together the subsidy represents—at present prices—about 25 per cent. of the cost.
1330 I believe that this reduction in the public commitment is fully justified, and I should like to say a word about the background to these cuts. For the current fertiliser year, it is estimated that the subsidy will cost £31.4 million. For several years now, the subsidy has been cut annually and consumption has not been adversely affected; and, now that considerably more satisfactory levels of fertiliser application are being reached by British farmers generally, I am sure it is right to make a further reduction in the subsidy this year. There is no reason for believing that this year's reduction will affect the rate of consumption.
As I have already said, there are no significant changes in the Scheme itself. The main features are the same as in previous years. Subsidy continues to be paid on fertilisers according to the amount of nitrogen or phosphoric acid derived wholly or partly from inorganic materials. They must be bought in quanties of 4 cwt. or more and used for agricultural purposes.
This subsidy, gives a considerable impetus to the use of fertilisers. I am sure the House will agree that it is an important and useful one, and I therefore ask the House to approve this Scheme.

§ Mr. James Scott-Hopkins (Cornwall, North)
I am sure that the House is grateful to the Joint Parliamentary Secretary for the brevity with which he moved the Motion that we should approve this new draft Scheme, which brings in a cut of £2 million in the amount of fertiliser subsidy.
I have one or two questions to ask concerning the Scheme before I come to my main criticism of the cut in general. First, with regard to paragraph 4 of the Scheme, can the hon. Gentleman tell us whether there has been any infringement, or any difficulty concerning the registration of suppliers? As he will be aware, under the terms of the Agriculture (Miscellaneous Provisions) Act, 1963, farmers had to deal with registered suppliers to qualify for the subsidy. I should like to know whether there has been any difficulty about this. Has he had any cases reported back to him of information not having been supplied? Has he had any information from his 1331 officers concerning fraud or otherwise, under the registration system?
Secondly, paragraph 8 is completely new and deals with the repayment of contributions. Perhaps he will explain why this paragraph has been found to be necessary. I know that my hon. Friends will wish to cross-question the Parliamentary Secretary about the tolerances which have occurred in the past. I will not say more. I hope that the Parliamentary Secretary will have time to mention any difficulties that have occurred in the tolerance system.
As the Minister said, there has been a cut of just over 6 per cent. in the rate of subsidy for each commodity. This has followed the same pattern as last year, but there is one great difference between this year and last year. Last year, when the previous Administration cut the subsidy by £2 million, they recouped the industry, through the Price Review, in respect of its increased costs, and at the same time gave about £32 million or £34 million in the Price Review.

§ The Joint Parliamentary Secretary to the Ministry of Agriculture, Fisheries and Food (Mr. James Hoy)
The General Election.

§ Mr. Scott-Hopkins
It was nothing to do with the election. If the hon. Member wishes to intervene perhaps he will do so from a standing position.
This year it is a very different matter. The industry has had to absorb about £19 million in increased costs, and it is feeling extremely sore about it. Under the Scheme it is being asked to absorb a further £2 million in increased costs. It is a direct increase in farmers' costs. In previous years the costs have sometimes gone down, but this year there is no question of manufacturers lowering their prices, and this cut will represent a direct increase in the farmers' costs.
If they use the same amount of fertiliser they will have to bear an increased cost. The Parliamentary Secretary, at Question Time recently, has been very keen to encourage farmers to use more fertilisers to make up for the increased costs they have to bear. That is what he has said, and he cannot get away from it. This Scheme represents quite a considerable increase in costs to the farming community.

§ Mr. John Mackie
I may have misunderstood the hon. Gentleman. He seemed to say that farmers were bearing a £19½ million increase in costs, and. immediately afterwards, that this was a further cut of £2 million. I would point out that the sum of £2 million should be included in the £19½ million, if his figures are correct.

§ Mr. Scott-Hopkins
No, it is not included. As the hon. Gentleman must know, the increased cost to the industry this year is about £29 million, and under the Price Review it has been given £10 million, leaving an increase of £19 million at the time of the Review. Does the hon. Gentleman believe that there have been no increases in costs since the Review? Does he believe that the Budget has not increased costs in the farming industry?

§ Mr. Speaker
It is in order to refer to any increased costs that might arise from the Scheme, but we cannot debate the Annual Price Review.

§ Mr. Scott-Hopkins
I was pointing out that this is an increased cost to the farmer, which he must bear. The Parliamentary Secretary said that the cost of the subsidy this year would be £31.4 million.
Looking quickly back through previous years I see this is the lowest figure for the fertiliser subsidy since 1959–60. I think that the Parliamentary Secretary must find it very difficult indeed to justify a cut of this nature at this particular time, bringing the fertiliser subsidy down to such a low level, the lowest it has been since 1959, particularly in view of the savage cuts that he has forced upon the industry and of the difficulties which the industry is going through at present. I am sure that my hon. Friends will join with me in deprecating that this has happened in the way it has.
The unfortunate part about this is that the farmers who will suffer from this are those who can least afford to do so. Quite obviously, this cut in subsidy for fertiliser, combined with the lime subsidy scheme cut, which is to come later, will hit those who grow grass and, of course, cereal growers. The cereal growers have, as we know, suffered the maximum cut this year in the Price 1333 Review. This is a further cut on top of that. They will have to bear this cut and the cut they took in the Price Review.
I say that this was quite unjustified and unnecessary and that the Parliamentary Secretary himself made a mistake, as he knows full well during the debate on the Price Review a couple of months ago, when he said it was forced on him and his Government by the previous Administration. This was completely false. This indignity and this extra cut that the cereal growers suffered——

§ Mr. William Baxter (West Stirlingshire)
On a point of order, Mr. Speaker. Is this not a violation of the Ruling you gave a moment ago that we should devote our time to discussing the matter before us?

§ Mr. Speaker
I was listening with customary courtesy and was handicapped by my personal ignorance of some aspects of agriculture. I had not quite got to the point when I would wish to intervene.

§ Mr. Scott-Hopkins
I was trying to point out the effect that this reduction of £2 million will have on those in the farming industry who will have to bear probably the heaviest burden and who are perhaps the biggest users of fertiliser. Quite obviously, they will have to pay more because they are getting less subsidy from the Government. That is the effect of the Scheme we are discussing. By having cut the Scheme by that amount, of all the types of people who will have to pay more for their fertiliser one is the cereal grower. If the hon. Gentleman the Member for West Stirlingshire (Mr. W. Baxter) takes exception to what I have been saying, perhaps he will endeavour to catch Mr. Speaker's eye later.
The other type of industry which uses a great deal of fertiliser, and would have to pay more for it through the lack of Government subsidy, is the livestock industry. This is particularly true in relation to production of milk and rearing of beef. These people will be particularly hard hit, because as the House will know full well, during the Price Review they were recouped to a very small extent and now all that recoup- 1334 ment has gone. They had relied on this when increasing their productivity to meet their rising costs in the use of fertiliser. The Parliamentary Secretary knows this full well. He has advised them to do this and now he is making those fertilisers more expensive. This is, with respect, absolute nonsense, and something the Parliamentary Secretary ought not to do. The best thing he can do is to withdraw this Scheme altogether and restore the position as it was before the Price Review.
It will not only be the milk producer who suffers, but also the meat producer. It is nonsense for the Government to make speeches in the House and in the country telling farmers that they want to encourage them in increasing their productivity of milk, calves and beef when, at the same time, they are doing the most they can to discourage them in the proper use of the land, and in producing the grass which is part and parcel of increasing the productivity to meet the demands of the Government. It just does not make sense. This is the wrong type of subsidy. A point which has been brought to my notice—perhaps the Parliamentary Secretary can tell me whether it is true or not—is that it seems that there is a shortage of nitrogenous material in the south of England. I have no evidence to substantiate that. I was informed of it only this evening, but perhaps the Parliamentary Secretary can let the House know——

§ Mr. Walter H. Loveys (Chichester)
If my hon. Friend would like some confirmation of his statement, I am able to inform him that only the other day I got in touch with the Southern Counties Agricultural Trading Society, a large-scale registered supplier of nitrogenous fertilisers, and was told that it bad had no supplies for several weeks and had no idea when it would get any more.

§ Mr. Scott-Hopkins
I am grateful to my hon. Friend. Perhaps he will try to catch your eye, Mr. Speaker, at a later date—[Laughter.] Well, the Parliamentary Secretary must know that there is no limit to the time during which we can go on discussing this matter. I am sure that the Parliamentary Secretary will have a great deal to say, as he always has, and that he cannot imagine how glad we shall be to hear him.
1335 As I was saying, if there is a shortage I hope that the Parliamentary Secretary will see that the situation is dealt with in the near future, and then the farming industry will be grateful to him. This cut of £2 million is a false economy. There is no parity with what happened last year. The Government subsidies are at the lowest level since 1959 and I think that that will work against the long-term interests of agriculture which the Government profess to have at heart. Judging from statements made from No. 10, Downing Street, and from elsewhere, the Government seem to want to encourage farming, but by their actions they discourage the industry.
I suspect that this resulted from a question of mathematics. The Government have made a cut of £2 million. The Minister of Agriculture was told, perhaps by the Prime Minister or by the First Secretary, that all he would be allowed was £10 million, and as the right hon. Gentleman wanted to give a few small bribes to other parts of the industry he had to make cuts elsewhere. He thought that perhaps we would not notice this cut, and that there would he no outcry about it. It is a false economy and the industry will regret it. There can be no compensatory lowering of prices by manufacturers who have had increases in their costs, due to the action of the Government.
All in all, I regard this as an unfortunate action which has been taken at the wrong time. I regret that, once again, the Government are introducing measures which will reverse the trend which was apparent under the previous Administration when steps were taken to encourage farming and give confidence to the industry. The cuts have been imposed where they will do the most harm to the industry, and I regret that the Minister has brought the Scheme to the House in this form.

§ Mr. Michael Jopling (Westmorland)
Like my hon. Friend the Member for Cornwall, North (Mr. Scott-Hopkins) I am extremely disappointed that the Government have seen fit to cut the rate of subsidy this year. We are proud of the increasing efficiency of our agricultural industry which depends so much on the use of fertilisers, as has been apparent over the last few years. Between 1963 1336 and 1964 the use of nitrogen, for example, has increased by 12.2 per cent. This is an example of how the industry by the use of fertilisers is reacting to the demand for greater efficiency. It is a shame that we should have to endure these cuts at this time. It seems quite wrong that the Government should take this action. I can only think that it is a case of killing the goose that lays the golden egg.
I was always brought up to believe in the old adage that one should live as though one were going to die tomorrow and farm as though one were going to live for ever. It seems to me that with fertilisers, one is right at the root of this in terms of how one should farm. Everything should be done to encourage farmers to use as much fertiliser as possible. I think that it is true to say that the Scheme over the years has worked very well. But there are two points which are worthy of the Minister's attention, where I do not believe that the farmer or the Minister—who is the mouthpiece of the taxpayer—is getting full value for money. I do not believe that anything illegal is going on, but there are certain loopholes and certain practices which need to be tightened up.
I ask the Minister if he will look at these two things. The first is the background to the figure which I have already mentioned of the increased use of nitrogen. I am sure that he is aware, being a farmer like many of the rest of us, of the spectacular results which can be achieved from the use of more nitrogen. It is now common practice to have as much as 100 units of nitrogen to get the best results with wheat. Very plausible theses have been written explaining how one can get an economic return by using as much as 15 cwt. of nitro chalk on grassland.
When one talks about nitrogen, it is easy to cover the whole lot with one umbrella. There are many sources—sulphate of ammonia, ammonium nitrate and urea—the last of which I believe is creeping in for too much in the composition of fertilisers. As the law stands at the moment, there is no onus on any manufacturer to state what proportion of urea there is in his compound. This is something which ought to be looked at, because I think that a very strong case has been made out on the harmful effect 1337 of urea and the fact that it is a most inferior form of nitrogen. As the Parliamentary Secretary, I am sure, knows, when urea is applied as a fertiliser, an enzyme action occurs in the soil and the chemical is converted to ammonia gas. If one is not very careful, this ammonia, this source of nitrogen, is lost to the atmosphere.
It has been proved that, particularly in top dressings and grassland, urea is extremely harmful and bad to use economically. Dr. Cooke of Rothamstead has suggested that 100 units of nitrogen applied as urea are as effective as only 80 units when applied as nitro chalk.

§ Mr. Deputy-Speaker (Sir Samuel Storey)
I think that the hon. Member is getting wide of the Scheme which we are discussing.

§ Mr. Jopling
With respect, Sir Samuel, I was trying to make the case that to get the best use of the subsidy, it would be better to be sure that the subsidy was used for the best possible sources of nitrogen. If you direct me that I am out of order, I must bow to your Ruling.

§ Mr. Deputy-Speaker
I think that the hon. Gentleman should direct his remarks to the fact that the subsidy should not be paid for urea.

§ Mr. Jopling
I would certainly take that up. The Minister should make up his mind—I do not mind how he does it —and he should either say that any content of a compound which is composed of urea will not qualify for subsidy, or he should go the other way, which I think would redress the balance to a large extent by making it compulsory for all manufacturers to say what proportion of urea is in their compounds.
Very many manufacturers are now including up to, and some well over, 20 per cent. of urea in their compounds and it would make a great difference if urea were not allowed to qualify for the subsidy. If it did not qualify I am sure that there would be few compounds in future which contained urea. It is a very much cheaper source of nitrogen to the compounders and they are, therefore, tempted to use it because they find it difficult to compete in the great competition which goes on between fertiliser manufacturers.
1338 I hope that the Minister will look seriously at this matter. A strong case has been made out to show the harmful effects of urea, particularly in cereals with combined drilling, and the harmful effects on the germination of corn has been shown with a compound content of over 12 per cent. of urea. It would be as well if the percentage was reduced as much as possible and if the inclusion of urea in compounds was not allowed to go on with the present subsidy system on fertilisers.
I move from that point to the second matter I wish to raise, which is the way in which the industry and the public—the public as taxpayers and providers of subsidies—are not getting full value for money. There is a strong case for trying to do something about the present position of the tolerances allowed on the analysis of fertilisers. At present the tolerances allowed on fertilisers, on compounds, is 10 per cent., with a maximum of 1.75 per cent. total difference in any one nutrient. This means that if a compound contains, say, 10 per cent. of potash, a manufacturer can produce between nine and 11 per cent. without breaking the law. This means, when one thinks of the compounds in most general use today, that a manufacturer is allowed an enormous difference in the value of the fertiliser if he works inside the tolerances. With the most typical corn fertiliser, 22–11–11, there is, using last year's prices, a permissible discrepancy of 54s., on which no less than 16s. 7d. is public money. This, in turn, means that there is, in terms of subisidy, a very large discrepancy per ton which the manufacturer is allowed to have.
This tolerance is much too large. A great deal of public money is, perhaps, being lost because of the large and wide variation which is allowed in the analysis of fertilisers. There is more than a suspicion that a small minority of fertiliser manufacturers are working to the bottom end of the tolerance scale and are——

§ Mr. Deputy-Speaker
Order. The hon. Gentleman must relate his remarks to the scheme. I do not see where this question of tolerances comes into the Scheme which is before the House.

§ Mr. Jopling
I took this matter up, Sir Samuel, with the Journal Office last 1339 week. Although I must, of course, bow to your Ruling, I was advised by the Journal Office—and I appreciate that that advice does not bind you, Sir Samuel—that it would be in order for me to talk about this because, I was told, paragraph 3 of the Scheme implies that steps are taken to ascertain the nature of the fertiliser, while paragraph 7 is concerned with the inspection of the fertiliser in question. It was my general impression that I should be in order in raising these matters. However, if you rule me out of order and say that it is wrong for me to discuss these issues I must, of course, bow to your Ruling.
I felt bound to say that public money may be wasted unnecessarily over the fertiliser subsidies. Perhaps something could be done to tighten up the system. If it were not possible to tighten matters up it might be possible to make other arrangements, but, before proceeding, if it is your Ruling that I should keep off this topic then I must abide by it

§ Mr. Deputy-Speaker
I thought that the hon. Member was arguing that another provision should be made to change the tolerances that are allowed. I do not think that that would come under the Scheme, but there is the question of inspection, to which I think the hon. Member could relate his remarks.

§ Mr. Jopling
Thank you, Mr. Deputy-Speaker. Inspection is enormously important, as I have found out to my cost. Within the last year I have had fertilisers sampled, as I thought I was getting some that might well be far down in the tolerance scale. The analysis was a most enormous and lengthy business. It took three men half a day to sample about 100 tons of fertiliser, and I certainly hope that it will not be necessary for me to have it done again.
It seems unfortunate that within the last few months the rate of subsidy should have been cut. I am sure that something can be done to alter the way in which these tolerances are worked out. If the Minister will be kind enough to look at this matter in order to see whether sufficient money would be saved by tightening up these tolerances to make the exercise worth while, and will also look at my previous point about urea to see whether subsidy money could 1340 be saved there, I should be extremely pleased.
I believe that new techniques for analysing fertilisers provide an important and legitimate argument for saying that these large tolerances are no longer necessary. I myself have seen the new auto-analyser techniques. Continuous results can be obtained for every form of analysis and every type of nutrient within 10 minutes, and this method has quite revolutionised the whole business of the control of manufacture.
A report on the new techniques of analysis presented to the Fertiliser Society in November, 1963, stated: Then it should be possible to have an almost continuous record of the composition of a product from a fertiliser plant. This will permit even closer control of product quality than has been possible hitherto, and be of considerable benefit to the whole fertiliser industry. Because of the new techniques and the new information that is available, I believe that now is the moment when these tolerances can be tightened up. I hope that the Minister will find ways of tightening up in the two ways I have suggested, and thus save money that I believe is at present going down the drain.

§ Mr. Hector Monro (Dumfries)
Over the last few months, hon. Members on this side of the House have shown with great clarity the reduction of profitability in agriculture and last week, more particularly, in an Adjournment debate, we showed that the profitability in dairying had decreased twice as fast in Scotland as in England.
I am glad to see the Minister of State, Scottish Office, here tonight, to hear these brief remarks. The only way in which dairy farmers, particularly those in Scotland, can produce from fast diminishing returns is by increasing production from their herds and increasing the amount of fertiliser so that they can produce more milk. Yet they are to have a reduction in the fertiliser grant, the very last thing which Scottish farmers wish for from any Government. I hope that the Minister will explain to the farmers of Scotland why dairy farmers will have to put up with the reduction. That, of course, goes for beef and sheep production also.
1341 There is a glorious "paper chase" concerned with the payment. The supplier has to get a form from the Ministry, fill it in and post it to the occupier, who has to fill in another part of the form and post it to the local office of the Department of Agriculture. That Department has to fill in still another part of the form and send it to St. Andrew's House, Edinburgh. Eventually, a cheque comes to the occupier who, at last, can put the money in his bank.
This seems to be an extraordinarily roundabout way of paying the subsidy. I quite agree that it is absolutely vital that public money should be spent wisely and that all safeguards should be provided, but these half dozen exchanges of letters seem to be a very wasteful method of paying for this decreasing subsidy.
I hope that the Minister of State will reply to these points.

§ Mr. Alick Buchanan-Smith (North Angus)
At a time like this, when everyone in agriculture has to tighten his belt, it is particularly disappointing to have this reduction in production grants. I have always believed them to be one of the most important supports for agriculture, a way to encourage efficient agriculture and to make it more competitive with overseas production.
This matter is important, because this is one way in which Government money can be spent to help those farmers who are prepared to help themselves. That is an important criterion for any support which is given. No farmer can collect this subsidy unless he is first prepared to make an outlay on fertiliser. For this reason it is a great pity that the Government should have seen fit to reduce the grant.
There is undoubtedly at present in Britain tremendous scope for improving and extending the use of fertiliser. Reference has been made to its greater use for the production of cereals. It may be a good thing to include nitrogen to a very high rate for the production of wheat, but to do so for the production of barley for distilling purposes would not be so welcome to the distilling interests.
I wish to speak particularly about the tremendous scope there is on stock 1342 farms and dairy farms for increased application of fertiliser. Stock farming is by far the most important sector of agriculture in Scotland. There is very wide scope for the more intensive use of fertiliser on grassland. This can lead to the better use of grassland and we could save on our importation of proteins by conserving more grass for winter feed. In this respect, the economy made by this Scheme is particularly unfortunate and could have a bad effect on our balance of payments position.
There is also the question of the use of fertiliser in upland areas. Only 10 days ago we were debating an increase in grant for winter keep and for hill farming subsidies. I have always felt that money spent in hill areas is well spent. It can be supported further if more money can be spent on improving hill grazings. One of the quickest ways of doing this is the wider use of fertilisers.
It appears from the Journal of Scottish Agricultural Economics, published by the Department of Agriculture for Scotland, that when there has been a setback in the amount of fertiliser used it has fallen back far more in upland areas than in dairying and in cropping areas. The inference to be drawn from the present cut in fertiliser subsidy is that there is likely to be a more than proportionate fall in the use of fertilisers in the very areas of Scotland where their increased use would be most welcome.
I hope that the Government will review this on account of the effects on Scottish agriculture in general, particularly in dairying and upland areas.

§ Mr. Peter Mills (Torrington)
I am delighted to see that the hon. Member for Caithness and Sutherland (Mr. George Y. Mackie) is back in his seat. For one moment I thought that the Liberals were not interested in fertilisers.

§ Mr. George Y. Mackie (Caithness and Sutherland)
It is not fertilisers I am interested in. It is some of the speeches.

§ Mr. Mills
That may well be. One Liberal at least is in his place. I do not know what has happened to the Liberal Members from the South-West. It is obvious that they are not interested in fertilisers. In view of the problems 1343 in the South-West, I should have thought that they would have taken an interest in this matter, because this is one means of helping to raise agricultural production in the South-West.
If I were asked what major contribution had been made to modern agricultural techniques, high up on my list would come the use of modern compound fertilisers. There is no doubt that over the past few years subsidies have played a very big part in these new agricultural techniques. The Conservatives are to be congratulated on the part they played in this over the years when they were in office. Therefore, it was with a little sorrow that I realised that the first thing that a Socialist Minister of Agriculture did was to cut the fertiliser subsidies. I am sure that the Socialists will regret this in the years ahead.
Over the last 20 to 25 years there has been an enormous advance in fertiliser techniques. I can look back over nearly 26 years of farming. I well remember what was said in those far-off days about compound fertilisers. It was almost an immoral thing to speak of sulphate of ammonia, or "nitre", as it was called in those days. There was much shaking of heads at the use of these new modern fertilisers. In those days we relied on dung, hoof and horn, and shoddy.

§ Mr. George Y. Mackie
On a point of order. Are the interesting reminiscences of the hon. Gentleman relevant to the Scheme?

§ Mr. Deputy-Speaker
I take it that the hon. Member for Torrington (Mr. Peter Mills) intends to relate them to the question whether these rates of subsidy are adequate.

§ Mr. Mills
Thank you, Mr. Deputy-Speaker.
If I may continue, the hon. Member for Caithness and Sutherland will understand my argument. At least, I hope that he will. It was said in those far-off days that the use of these subsidies was pulling the ground. There has been a great change. There has been a great expansion. There is no doubt that subsidies have played their part in this expansion. I believe that if we want to achieve an expansion in our food production fertilisers will have to play an ever-increasing part. The accelerator is only half down. Much more could be done. I believe that 1344 much more will have to be done to feed a hungry world.
Fertilisers will play their essential part in this work. I am, therefore, not happy at this cut in the fertiliser subsidy. This, coupled with the other cuts which we have experienced, will not help agriculture, to say the least. I believe that the Socialist Government will bitterly regret this cut of £2 million. André Voisin believed that the destiny of nations and of civilisation depends largely on our ability to use mineral fertilisers wisely and in ever-increasing amounts. This cut will certainly not help in that. We need an ever-increasing use of fertilisers in this country.
To turn to one or two practical points on the application of fertilisers—and I hope to prove that what I have to say comes within the scope of the Scheme. I believe that however much the subsidies are increased or are cut it is essential to have efficient spreaders. This is not to say that we lack efficient spreaders in this country, but that——

§ Mr. Deputy-Speaker
Order. I do not think that the application of fertiliser by spreaders comes within the Scheme.

§ Mr. Mills
I was trying to say that there is not much point in having subsidies at all if the application of the fertiliser is not 100 per cent. correct.

§ Mr. Deputy-Speaker
Order. The hon. Gentleman is getting wide of the Order.

§ Mr. Mills
May I move on to the question of liquid fertiliser? I am not sure whether the Scheme covers it.
Much research on this question is needed. My observations are——

§ Mr. Deputy-Speaker
Order. We cannot go into the question of research into liquid fertiliser on this Scheme.

§ Mr. Mills
If I am out of order I will not continue on that point. I should be glad of an assurance that liquid fertilisers come within the scope of the Scheme. I hope that the Paarliamentary Secretary will look into the matter, because I believe that there is a great future for the use of liquid fertiliser in agriculture. I repeat that I am disappointed by the cut in the subsidy. It is a backward move which will not help agriculture. The Government will regret it in the years to come.

§ Mr. George Y. Mackie (Caithness and Sutherland)
I have listened to the argument, which has been somewhat small from this side of the House, against the cut in the subsidy. The cut, of course, is a bad thing and is another addition to the many burdens which farmers have to bear, but there are other features which could help farmers a great deal more. This cut is not nearly as bad as the cut in the prices which farmers receive.
I should like the Parliamentary Secretary to tell us, if he can, how much we are paying for imported fertilisers. I know that there are a great many tariffs on then and that a total of about £30 million is being expended on this subsidy and the farming industry is bearing a cut of £2 million. How many millions of pounds are we paying for fertilisers imported into the country both in raw material and in manufactured nitrogen, which was useful in bringing down the price and increasing the nitrogen content of nitro-chalk and other nitrogenous fertilisers in this country? One thing we badly need in the industry in order to offset cuts in subsidies of this sort, as witness the Monopolies Commission's Report, is a close look at the tariffs on this important raw material——

§ Mr. Deputy-Speaker (Sir Samuel Storey)
Order. We cannot discuss tariffs on this Scheme.

§ Mr. Mackie
I bow to your Ruling, Mr. Deputy-Speaker, having finished that point. I should very much like to know how much could be offset against this cut if the question were really gone into.

§ Mr. Paul Hawkins (Norfolk, South-West)
The Minister was commendably brief in opening the debate, and I shall try to follow his example. However, his remarks were not very sweet to the farming community, because this Scheme means a cut of about £2 million. My constituency of South-West Norfolk is probably one of the greatest users per acre of fertilisers, and the cut will mean a great deal there. The corn growers of East Anglia have already experienced a very big cut, the biggest possible cut that could have been imposed under the Price Review. To our county council 1346 smallholders on, say, 50 acres, it will amount to about £1 a week. What other section of the community has had a cut of this order since this Government came to power? Is it any wonder that the temper of the farmers is shorter than it has ever been since the war?
I support what was said by my hon. Friend the Member for Westmorland (Mr. Jopling) on the tolerance allowances. I am a member of the public protection committee of the Norfolk County Council, and I know from experience what we are coming up against in having to administer the testing of artificial manures and their composition. We have been extremely worried to find that certain manufacturers have cut the tolerance allowance to the absolute minimum. As a result, farmers are not getting the full benefit of what they are paying for, and the country is not getting the full benefit of the subsidies which it is paying out. It has been very difficult for county councils to press a prosecution. The Ministry, under whichever Government, has always been extremely chary of pressing prosecutions for infringement of the tolerance allowances. I hope that the Minister will look into this again, because it is public money involved in the subsidies.

§ Mr. Deputy-Speaker
The hon. Gentleman is getting on to prosecutions and going away from the Scheme. He must relate his argument to the subsidy.

§ Mr. Hawkins
I am very grateful to you, Mr. Deputy-Speaker. I can only urge that we look closely at how we spend our public money on subsidies in this way. The great corn-growing industry of East Anglia has suffered a very severe blow in the Price Review, coupled with the cut in subsidy, and I hope that the Minister will take an early opportunity to review the subsidy.

§ Mr. John Mackie
You have been so lenient in calling hon. Members to order, Mr. Deputy-Speaker, that I find I have taken a lot of notes of what has been said but I have not put at each appropriate point "Called to order", so that, in answering, I am almost bound to get out of order myself. No doubt, you will be as lenient with me as you were with hon. Members opposite.
1347 This is not a debate on the Price Review. It is a debate on the Fertilisers (United Kingdom) Scheme, 1965, which I have put to the House tonight. Most hon. Members have taken the opportunity—I suppose that it is perfectly legitimate so long as the Chair keeps them in order—to discuss other matters, but I feel that some of them really overstepped the bounds.
The first point made by hon. Members opposite was their claim that this Scheme represents a disaster for the farmers and that it will make them bankrupt overnight. There are 32 million acres of grass and crops in the country. Divide that up and it works out at exactly 1s. 3d. an acre. I do not know whether that will bankrupt the farmers, but that is the figure.[Interruption.] Hon. Members have made the most of their points. I shall make the most of mine. The figure is 1s. 3d. an acre.
The hon. Member for Cornwall, North (Mr. Scott-Hopkins) asked whether we had had any difficulties in registration—for instance, whether there had been any fraud. We have had little or none and all has gone as arranged. Paragraph 8 is additional to this Scheme as compared with last year's. It is simply to provide a new declaration in the application form, which will safeguard the Minister in reclaiming the subsidy where the fertilisers are not used in accordance with the terms of the application. For instance, a farmer may order fertiliser, claim and receive the subsidy and then return the fertiliser to the supplier.
I should like to pull the hon. Member for Cornwall, North up on one point, with which he made great play. He claimed that the £2 million involved here was extra to the Price Review whereas in fact it was included in the Review. It was not brought before the farmers for the first time by this Order. They knew about it at the Price Review. To say that there have been extra costs since has nothing to do with this Order. The figure was calculated for the Price Review. Whether or not we are agreed on the figure of £19½ million used by the hon. Member for Cornwall, North has nothing to do with the argument.

§ Mr. Scott-Hopkins
But the hon. Gentleman will accept the point that this 1348 is an increased cost to the industry and that the costs are more than £19 million.

§ Mr. Mackie
It is not a point at all. This was not an increased cost introduced tonight. It was in the Price Review two months ago. It is not additional to the Price Review. The hon. Gentleman gave the impression that it was an extra £2 million as of tonight and it is nothing of the sort.

§ The Minister of State, Scottish Office (Mr. George Willis)
It was misrepresentation by the hon. Member for Cornwall, North (Mr. Scott-Hopkins).

§ Mr. Mackie
The hon. Member for Chichester (Mr. Loveys) raised the question of shortage in south-east England. He has written to the Board of Trade, which has asked us about it. We have had no real complaint about this. I gather that he is worried about nitrogen and granular nitrogenous fertilisers. One of the reasons for the situation is that sometimes people take advantage of what is left in order to claim last year's subsidy. Farmers are often late in ordering. This has happened in the past and it is nothing serious. Sulphate of ammonia is available but is not so easy to spread and we could do with a better spreader. But perhaps I had better stop at that point in case I get out of order.
The hon. Gentleman also made a point about £31.4 million as being the lowest figure for subsidy for fertilisers since 1959. He forgot to mention that fertiliser prices had fallen considerably since then. Although I have not worked it out, I imagine that the proportion of subsidy to price is probably higher than it was before. I may be wrong but the situation is not in any case as bad as he made out.
The hon. Member for Westmorland (Mr. Jopling) damned the Scheme with slightly faint praise. The hon. Member for Torrington (Mr. Peter Mills) reminisced a little too much but made a point about loopholes in the use of nitrogen and urea. The question is overdone, but we will take note of it. The Advisory Committee under the Fertiliser and Feedingstuff Act is looking into this matter.
On the question of tolerances——

§ Mr. Scott-Hopkins
Can the hon. Gentleman tell my hon. Friend and the 1349 House, having taken note of it, what action he can take to do anything about it?

§ Mr. Mackie
The action of putting it to the Advisory Committee, which is why that body exists.

§ Mr. Jopling
By that, does the hon. Gentleman mean that he will put the case of urea to the Standing Advisory Committee?

§ Mr. Mackie
I said that I would take note of it and go into the matter. [HON. MEMBERS: "Hear, hear."] If one promised to do everything that hon. Members opposite suggested without going into the matter fully to see whether their suggestions had any background, I do not know where we should be.
The question of tolerances has been gone into by the Advisory Committee to a considerable extent. Although there may be individual cases where the tolerances are the wrong way, returns from local authorities show that, on the whole, farmers are getting rather more than the amounts declared, which means that there is no overall loss but a slight saving in subsidy. Although there may he individual cases in which it works the other way, and I understand that the hon. Member for Westmorland had such a case, that is what the overall figures from the local authorities show.
The hon. Member mentioned new techniques in analysis. Again, I suggest that that might be put to the Committee. If there are techniques that can help in any way, I am certain that they will be taken up.

§ Mr. Jopling
The hon. Gentleman again raises the question of the Advisory Committee, as he did a few minutes ago, when, on being pressed, he said that he would go into it himself. Does he advise me to do it myself to get action, or does he intend to change his mind and to let us have action from him for a change?

§ Mr. Mackie
In answer to a Question which he put to me some time ago, I gave the hon. Member all the particulars of the procedure for applying to the Advisory Committee. He can do it, but we will, naturally, take note of what he has said; and if we consider it all that important, we will look into the matter.
1350 The hon. Member can proceed himself if he wishes.
The hon. Member for Dumfries (Mr. Monro) also made great play on the subject of the Review. This is not a cut which has been made tonight. It is a Review decision, and I do not propose to start on the argument about that. The hon. Member objected to filling in forms and said that it was a waste of paper, time and stamps. Considerable thought has been given to this matter. Although it might be better to pay the subsidy direct to the manufacturer, we would then have the big problem of all the other users who use fertilisers—gardens, golf courses, sports grounds and everything else—and it might take just as long to get the forms back that way as it does the way we do it at present. If those in the industry are to collect 31.4 million, they should not object to filling in a few forms correctly.
The hon. Member for North Angus and Mearns (Mr. Buchanan-Smith), my Scottish Member of Parliament, mentioned, among various other things, my advice to farmers, if they wanted to recoup the little cut that they have had recently, to put on more nitrogen, and he was worried about the amount to put on to destroy the distilling quality of barley. It is a point, but I doubt whether it is valid. Enough barley is grown in the country for there to be a selection for distilling, leaving the rest for feeding. He made the comment that grass was now one of the crops on which nitrogen was used. I point out that on average the cost would be ls. 3d. an acre, so that if farmers want to put on a little more, it would not cost them all that much.
The hon. Member for Torrington was reminiscent and mentioned nitre and was not too happy about the cut. He wanted efficient spreaders, but was pulled up for being out of order. The best way is to spread parallel to the road and then it is not seen. He mentioned the use of liquid fertilisers. The subsidy is paid per unit of nitrogen irrespective of how the nitrogen is bought. Liquid fertilisers have considerable value in a dry year when they mostly go in through the leaf and there is not the rain to put in the powdered form.
The hon. Member for Caithness and Sutherland (Mr. George Y. Mackie) 1351 wanted the figures of imported fertilisers. I am never sure where the Liberal Party stands and I did not know whether he was arguing that it was a good thing to have imported fertilisers, provided that they did not have a tariff, or whether the amount of the tariff would be sufficient to pay back the £2 million, or whether he simply meant that the competition would be a little greater and that firms in this country would then bring down their prices.

§ Mr. George Y. Mackie
I had heard that the hon. Gentleman was a little slow. I hoped that he would be able to tell us how the figures related, whether the amount collected in tariff would repay the £2 million, or the whole of the £31 million. Those figures are relevant to the costs which farmers are bearing.

§ Mr. John Mackie
I can assure the hon. Gentleman that they will not pay the £31.4 million. Speaking from memory, I think that the total cost of fertilisers used in this country is about £120 million, but I will certainly look up the figures for the hon. Gentleman to see whether I can satisfy him, although I know from experience that that is difficult.
The hon. Member for Norfolk, South-West (Mr. Hawkins) emphasised the dreadful hardship which would result for Norfolk farmers from the 1s. 3d. an acre extra cost which they would have to pay for this fertiliser, and he mentioned tolerances. I have said, I shall look into that.
I think that I have kept fairly well in order, at least as well as hon. Members opposite, in replying to their comments. I am perfectly certain that if I have not satisfied them, they should be satisfied. I hope that the House will now accept the Scheme.