HC Deb 17 January 1967 vol 739 cc345-7
Mr. Stodart

I beg to move Amendment No. 76, in page 68, line 33, at the end to insert: 'and in particular shall provide that grants are not made to any person in such a way as to provide unfair competition with those already carrying on similar trading activities and who are members of the established trade'. The Clause deals with grants for purposes connected with co-operative activities. These are activities which, I believe, we all wish to foster. All that we are concerned about is that grants should not be given for the purpose of co-operative activities which will enable them to provide, because they are grant-aided, unfair competition with other people already established in the trade and carrying on similar trading activities.

I would not pretend that the wording of the Amendment is necessarily right, but I hope that the Government will appreciate our sentiments. For an analogy one can go to the grants which are given to the machinery syndicates under the Agriculture (Miscellaneous Provisions) Act. Once they have been grant-aided, machinery syndicates are not permitted to dry grain commercially for other people because this would bring them into direct competition with other commercial grain driers, and the fact that the machinery syndicate had had Government grant to assist it in its capital development would put it in a favourable position.

This is the reason for the Amendment, and I hope that the Government will feel able to accept it.

Mr. John Mackie

We understand the feeling behind the Amendment. Naturally, the corn merchants and foodstuffs manufacturers are very much concerned in the matter.

In paragraph 37 of the White Paper we stated that we would not grant aid processing "beyond operations of this sort that were normally associated with farming and growing. We propose to provide grant aid towards the provision of facilities for co-operative milling and mixing, and so on, because these are operations which are normally associated with farming, being carried out for the purpose of feeding stock.

In the same paragraph of the White Paper we also stated that we did not propose to provide grant aid for bodies which were merely acting as wholesalers, and we intend that the proposed Central Council, in examining proposals before making recommendations, should ensure that applicants are genuine co-operatives marketing produce on behalf of, and for the benefit of, their members, who must be subject to appropriate loyalty conditions. This will provide a general safeguard to the cereals trade.

As regards milling and mixing in particular, we propose, when dealing with applications from co-operatives for grant aid for these and kindred activities, that the council should apply the following four specific safeguards. First, the grant-aiding of milling and mixing facilities will be limited to the capacity appropriate to the feed requirements of the members concerned with the application. Second, the grain to be milled and mixed will have to be mainly grain grown by these members as a whole. Third, the feeding-stuffs must not be sold other than to such members. Fourth, the grant-aided facilities must not be disposed of for a stipulated period, which has not yet finally been decided upon but will probably be five years, in default of which grant will be recovered.

We have told the N.A.C.A.M. and the C.A.F.M.N.A. about these safeguards and that it is our intention that they should be included in a working document, which is to be agreed between the council and the Ministers concerned, covering the administrative arrangements of the grant scheme. I am satisfied that this will adequately protect the interests of the established trades and, indeed, will be more effective than would the Amendment, which does not make clear what is meant by "unfair competition".

I hope that, in view of these assurances, the hon. Member will agree that the Amendment is unnecessary.

Mr. Stodart

I suspected that there were probably a couple of words at least in the Amendment through which a horse and cart could be driven. My right hon. Friend and I are satisfied with the hon. Gentleman's explanation and I beg to ask leave to withdraw the Amendment.

Amendment, by leave, withdrawn.