§ Order for Second Reading read.
§ The Minister of Agriculture, Fisheries and Food (Mr. Cledwyn Hughes)
I beg to move, That the Bill be now read a Second time.
On 8th July, Mr. Speaker, I announced to the House the outcome of the Government's review of future policy for the deep-sea fishing industry. I undertook then that legislation would be introduced early in the following Session to give effect to our proposals. I am now redeeming that promise at the earliest opportunity. I am very glad to commend the Bill as our first legislative business in the new Session.
The fishing industry is important to our economy. It is important for the contribution which it makes to our food supplies and for the imports which it saves; and it is very important in certain areas for the employment which it provides.
As the House will know, the industry has been going through a period of great difficulty. The hopes of the Fleck Committee which found expression in the Sea Fish Industry Act, 1962 have not been wholly realised.
This has led us to review our policy. As a result, we are working towards a new and coherent strategy for the fishing industry. In doing this, we have made it clear that we shall not let the industry down.
The first element of our strategy is an assurance of continued support on a new basis. We are satisfied that the industry can make an increasing contribution to import saving, if it has the assurance of adequate support, and if it can show a continuing improvement in efficiency.
We have now given the deep-sea industry an assurance of support for a minimum period of five years. For the first three years—from August, 1968 to July, 1971—the total subsidy will be calculated according to the formula which I have already announced. This relates each year's subsidy to the actual profitability of the industry. For the fourth and fifth years, the method of sup- 914 port will be reviewed. But the objective will be the same. We shall seek to achieve a level of return to the industry corresponding to that of the first three years.
The second element of our strategy is to seek improved efficiency in the industry. We intend not only to give the industry the confidence which stems from assured support. We intend also to use the subsidy itself as an instrument for encouraging efficiency. At present, all vessels in a given length class receive the same basic daily rate of subsidy, irrespective of their efficiency. In future, the subsidies paid will be related to the efficiency of each individual vessel.
§ Mr. J. B. Godber (Grantham)
I would like to get one aspect of this clear, because it is very important. What the right hon. Gentleman is telling us is not in the Bill, but in the scheme which will be laid before us. Will he consider letting us have drafts of the scheme as soon as possible before the Bill becomes law? Without them, it will be difficult to follow the very complicated Measure about which he is talking?
§ Mr. Hughes
I shall be deploying this in rather more detail as I go on.
In the interests of efficiency, we also wish to see an expansion of the valuable work of the White Fish Authority, particularly in relation to research and development.
The third element of our strategy is that we wish to see an improvement in the structure of our industry. The Industrial Reorganisation Corporation is now actively engaged in discussions to this end. This is of great importance, but it would be premature for me to say more at this point. The Corporation has not yet completed its discussions or reached final conclusions.
I must also refer to the effect of imports upon the fishing industry. The House has been concerned about the pressure exerted on our market by the growth in imports of frozen fish fillets from E.F.T. A. countries. These imports have been exceeding the level of 24,000 tons a year, the maximum envisaged when the E.F.T.A. agreement was negotiated in 1959. We have had lengthy discussions of this problem with our Scandinavian partners in E.F.T.A. But I regret to say 915 that it is now clear that they cannot give us any assurance that this increase will not continue.
In these circumstances, the Government have decided to reimpose a 10 per cent. tariff on imports of frozen fish fillets from E.F.T.A. countries. My right hon. Friend the President of the Board of Trade will put the necessary arrangements into operation as soon as possible.
I should like now to explain how the Bill will contribute to the achievement of this strategy. The new subsidy arrangements entail, in the first place, the repeal of certain provisions of the Sea Fish Industry Act of 1962. That Act provided for the automatic reduction each year of the basic rates of subsidy first fixed in 1962. The reduction will no longer be made. This is achieved by Clause I of the Bill. I am talking here of the deep sea section of the industry, not of the inshore fleet. It is right that I should stress this lest there be any misunderstanding in the debate on this account.
Hon. Members will notice that Clause I does not provide in terms for the new arrangements which will take the place of those that are repealed. It does not set out the formula for the calculation of the total subsidy sum or for its distribution on the basis of efficiency. These matters will be dealt with in the scheme which we shall lay before the House for approval by affirmative Resolution. I think that is the point on which the right hon. Gentleman wanted an assurance.
§ Mr. Godber
I am sorry if I interrupted the Minister too soon, but I think that he will recognise that that was not quite the point. They must come into the scheme, but my concern is that when we discuss the matter in more detail in Committee we should have the draft scheme before us, because it will affect the arguments adduced in Committee.
§ Mr. Hughes
I will try to tell the House a little more as I develop the subject. I appreciate the importance of having as much detail as possible at this stage. I can give the right hon. Gentleman the assurance that we shall lay the scheme before the House as soon as possible after the Bill is passed. It will be difficult to lay the scheme before the House during the Committee stage, 916 but when the scheme is put before the House hon. Members will have an opportunity to discuss the detail at that stage. But I will, if I may, to assist the House, say a few words about the way in which we propose to distribute the subsidy so as to provide an incentive to efficiency.
The main factor we are thinking of taking into account is the "added value" attributable to each vessel. Perhaps the simplest way to illustrate what is meant by "added value" is to think of a balance sheet for each vessel separately. On the debit side of the balance sheet are such things as the cost of its fuel, the cost of repairs and maintenance, and dock and harbour dues. On the credit side are the returns which it gets from the sale of its catch. The difference between these two figures represents the sum which is shared between the crew and the owners as wages and profits.
This is what the economists mean by added value. It represents the net contribution which their combined efforts have made to the economy after meeting the costs of the goods and services which they have used in the process. Of course, there are questions about the weight to be given to particular factors and how the calculations are to be made. On these matters my right hon. Friend the Secretary of State for Scotland and I will give the fullest weight to the views of the industry. These are matters we are discussing with the industry and with the trade unions.
One final word before I turn from the subsidy. The total available for distribution has, of course, to be calculated on the operating profits of the deep sea fleet as a whole in a past period. We are anxious to begin payments on the new basis as soon as possible. We are proposing, therefore, to do the initial calculations for a half year. If the industry can supply the necessary figures for the six months ended 30th September, 1968, we should be able to make the first payment very early in the new year. The industry will, I think, regard this as very helpful. This is on the assumption that this Bill and the subsequent scheme have both been approved by that date.
The House will, therefore, appreciate the importance of getting the Bill through. I am grateful to the right hon. Gentleman the Member for Grantham (Mr. Godber) and to the Opposition for their 917 assurance that hon. Members opposite will assist in its speedy passage.
I have already spoken of the importance of research and development in improving the technical efficiency of the industry. I should like to pay tribute to the excellent work already being done, particularly by the Industrial Development Unit of the White Fish Authority.
The House will readily agree that research and development work is vital if the industry's efficiency in catching and marketing its fish is to be increased. Here, the White Fish Authority has the important responsibility of carrying out commercial development work. The importance of this cannot be overstressed. The arrangements are the same as those which apply in many other industries for Government-assisted research. Half of expenditure on commercial development is financed from public funds, while the other half comes from the proceeds of a levy on industry. The White Fish Authority's general levy, from the proceeds of which this money for research has to come, is already at its statutory maximum.
The Authority has a wide range of other functions besides research and development. But it is especially in this field that we should all like to see its activities expanded. This the Authority can only do if its financial resources are adequate. This is the purpose of Clause 4.
This Clause will make it possible for any future levy regulations to work within a higher maximum. It will also broaden the basis on which the general levy is collected, if this should seem desirable. At present, there is a maximum of 1d. a stone. This was fixed in 1951 and is worth only about half of what that figure then represented. We are, therefore, revising it. At present, the rate is applied to all landings within the present definition of white fish, irrespective of type or utilisation. But it is not applied to any product outside that definition. We are, therefore, taking the opportunity to make these powers more flexible and to bring the levy arrangements of the White Fish Authority and the Herring Industry Board more closely into line.
I should emphasise that, once again, the House is dealing with an enabling power. No change can be made in either 918 the white fish or the herring levy unless subordinate legislation is subsequently approved. Any regulation by the White Fish Authority can take effect only if it is confirmed by Order of the Fisheries Ministers. Such an Order may be prayed against. There, again, the House can, if necessary, initiate a debate. Moreover, before the Order can be submitted for confirmation it has to be made available in draft to those affected. Their objections, if any, have to be transmitted to the Ministers for consideration when deciding whether or not to confirm the Order.
To summarise, Clauses I to 4 are the main financial provisions of the Bill. Before I leave them, I should briefly explain Clauses 2 and 3. Clause 2 is designed to ensure that we can make subsidy schemes which treat fish products in the same way as fish. We can also pay subsidy to a vessel if a catch is sold to a foreign buyer without actually being landed on the quay and reloaded. Clause 3 merely extends to fish subsidy schemes the kind of provisions we have all along had for agricultural subsidies. This, I think, will be appreciated by hon. Members on both sides of the House. With payments on the new basis, one man's subsidy will depend on the performance of the industry as a whole and of his competitors. It is essential, therefore, that we should have information which is both accurate and complete.
I now wish to deal with the Clauses concerned with conservation and policing. They are Clauses 5 to 14, and form the rest of the Bill. Their purpose is to provide the statutory framework needed to enable us to play our full part in international fisheries conventions to which we belong. This, too, will be welcome to our industry. It has long recognised the importance of international rules governing fishing operations, whether relating to conservation or to conduct on the fishing grounds.
The first purpose is to enable us to ratify and implement the policing convention—or, to give it its full title, the Convention on the Conduct of Fishing Operations in the North Atlantic—which was presented to Parliament as a White Paper (Cmnd. 3645) last June. Hon. Members may recall that, to pave the way for the extension of our fishery limits to 12 miles in 1964, we had to denounce the North Sea Convention of 1882.
919 That Convention not only established a fisheries highway code among ourselves and five other countries fishing the North Sea, but also provided the basis for our former three-mile fishery limit. At the conference which led to the European Fisheries Convention of 1964 we were invited to call a further conference for the purpose of establishing an up-to-date set of rules. We did this, and as a result the new Convention was agreed. It has been signed by 18 countries which fish the whole of the North Atlantic. This marks an important step forward in international co-operative effort.
Like its predecessor, the new Convention's aim is to reduce the risk of damage to fishing vessels and gear—and of injury to fishermen—by establishing a code for the fishing grounds. I will say a few words about the rules. It lays down rules for such things as the identification and marking of fishing vessels and gear, special light signals for vessels engaged in fishing, and conduct on the fishing grounds. It also provides for an international system of enforcement. Under this, authorised officers of a member country may inspect the operations of, and, if necessary, board, vessels of another member country on the high seas to see if the provisions of the convention are being complied with. If they find any contraventions, they will report them to the vessel's flag State, which alone will be responsible for any court or other action.
These arrangements reflect closely the provisions of the old 1882 Convention, which were carried into our existing fisheries legislation by the Sea Fisheries Act, 1883. There are, of course, modifications of detail in the new convention. But if hon. Members study these Clauses, they will see that they involve no new principles. Nevertheless, hon. Members will readily appreciate that its acceptance by all the main countries fishing the North Atlantic represents a real achievement. This country played the leading part in bringing the Convention into being. I am sure that the House will agree with me that it is important that we should be in a position to ratify it with as little delay as possible. The main purpose of Clauses 5 to 14 is to enable us to do this.
920 The House will have inferred from what I have said that many of these powers are already on the Statute Book in the 1883 Sea Fisheries Act. It was not surprising that when we looked into it we found that this Act which was drawn up in the age of sailing ships, was out of date in many of its details. It did not provide a satisfactory framework for today. We have decided, therefore, to repeal it. In the Bill we re-enact provisions which are still relevant, and we make suitable modifications.
Hon. Members will find, when we come to examine the 10 or so clauses in detail, that in almost every case they raise no new issues. They will prove, I believe, to be relatively straightforward. In brief, these Clauses empower Ministers to make orders applying to the United Kingdom internationally agreed rules on conduct. They prescribe the powers of British inspecting officers—sea-fishery officers—in relation to our own vessels and those of foreigners. They provide for authorised foreign officers to inspect our vessels outside our limits. They lay down penalties for contraventions.
This Part of the Bill will also enable us to participate in schemes for the international enforcement of conservation measures agreed by the international fisheries commissions. Again largely on a United Kingdom initiative, the North-East Atlantic Fisheries Commission has recently recommended a joint enforcement scheme which will do for conservation what the policing Convention will do for conduct. The Commission for the North-West Atlantic is also considering the possibility of a similar scheme. The Bill allows us to play our part in such schemes. Our industry rightly recognises these as essential in order to curb the over-fishing of stocks which are of vital importance to the British fishing industry.
The Sea Fisheries Act, 1883, provides, with the Fishery Limits Act, 1964, the basis for enforcing our fishery limits regime. In repealing the 1883 Act, the Bill therefore restates the rules governing the operations of foreign fishing vessels within our limits, with suitable modifications to take account of a 12-mile fishery limit. We have taken the opportunity to strengthen provisions against poaching and to stipulate that foreign vessels must stow their fishing gear while in our limits 921 except where they are legally entitled to use the gear. In addition, by Clause 16, we are amending the Sea Fish (Conservation) Act, 1967. This will enable foreign fishing vessels within our limits to be put on the same footing as British vessels. Henceforth, it will be an offence for foreign vessels to carry undersized fish on board within our limits.
These measures represent an important step forward in international fisheries arrangements. They will help our industry and will, I believe, commend themselves to the House.
I emphasise the valuable part which the Bill can play in achieving our strategy for the fishing industry. It prepares the way for our continuing support to the industry. It will contribute to the continuing efficiency of the industry. It will enable us to give effect to an important international convention which is of vital importance to our fishermen. It will promote the conservation of fish stocks. In all these ways it is a move forward and I commend it to the House.
Our fishermen deserve well of us. It is right that we should give them a fair deal.
§ 4.47 p.m.
§ Mr. Patrick Wall (Haltemprice)
I wish to thank the Minister for introducing the Bill with his usual courtesy and for giving us a little more information than we normally get from the Government Front Bench.
This Bill arises out of the review of the industry started way back in 1964 and it implements the undertaking which the right hon. Gentleman gave in this House on 8th July this year. I do not think there is any disagreement on either side of the House that during the four years since 1964 the state of the deep sea sections of the industry has considerably deteriorated. We all agree that something must be done and now the Government have decided to step up the subsidies from about £1.4 million to a maximum of £4 million. The Minister stressed that he will also seek reorganisation of the industry through the I.R.C.
We recognise that action is overdue and therefore we support the intentions of the Bill. We have, however, two major criticisms to make. First, the Bill in itself does little to indicate how the additional assistance is to be operated. The 922 only financial information in the Bill—which is a great contrast to the previous one—is found in the introductory paragraphs of the Explanatory and Financial Memorandum. Clearly the Bill will mean little until it is accompanied by the Order to which the Minister referred.
The Minister has today given further information. I hope that he will consider the suggestion put forward by my right hon. Friend the Member for Grantham (Mr. Godber) that he should try to make available a draft Order before the actual Order is made. He will recognise that it is difficult to have a debate on the technical provisions arising from this Bill until we know the details of the Government's proposals.
Our second criticism is that we believe that, even after four years in gestation, the Bill is, broadly speaking, a stop-gap rather than a cure. It increases the subsidy but does little to tackle the core of the industry's problem. I think that the Minister will agree with me that the core of the problem is that we cannot land British fish in European ports but the European countries can land their fish in our ports, and apparently quite often this fish is landed at prices well below the cost of production. We have heard a little more about this today, and later I will ask some questions about the 10 per cent. levy which the Minister mentioned.
We recognise that the Bill affects only the deep sea fleet—that is, the distant water, middle and near water vessels—and that the herring and inshore vessels continue to be assisted as before. I believe that the House recognises that there is a need in Britain for a deep sea fleet. Indeed, the Minister emphasised this in his opening remarks. It is clear that, if the fleet were allowed to disappear, it would affect our balance of payments by at least £40 million, probably more, and it would allow foreign catchers to more or less set their own price for fish.
The deep sea fleet has been greatly assisted by the last Sea Fisheries Act—that of 1962, which was introduced by the then Conservative Government and which started operating subsidies for distant water vessels. Since then the conditions under which these vessels operate has deteriorated. The obvious reasons, and ones well outside the control of our own industry are—traditional fishing grounds 923 have been lost; foreign subsidies have been greatly increased; and imports, especially those of frozen fillets, have greatly accelerated. At the same time, the cost of replacing the older vessels in the fleet has risen and the fishermen, rightly, have demanded better conditions and, quite often, better pay.
The Under-Secretary of State for Scotland said this in winding up our last debate:First there are subsidies, secondly E.F.T.A. and imports, thirdly the I.R.C. and fourthly the human aspect…".—[OFFICIAL REPORT, 24th July, 1968; Vol. 768, c. 538.]I want to consider those four headings separately.
First, subsidies. Both sides of the House recognise that the need for subsidies is caused by factors largely outside the control of our own industry. I stress that the need is now demonstrated very clearly by the fact that not one port or one section of the deep water fleet made a surplus last year after allowing for depreciation. This is obviously a very serious fact. I am informed that the fleet as a whole showed a loss averaging £18.6 per vessel per day. Landings, it is true, were up, but grossings were down—down by 9 per cent. in Hull and by 6.3 per cent. in Grimsby. Average prices per kit of fish fell from 86s. in 1967 to 78s. this year.
What is even more worrying is that the fish unsold and sent to fishmeal factories increased by just under 200 per cent. in Hull and by just over 500 per cent. in Grimsby. These are startling figures.
In 1966, the distant water fleet operating from B.T.F. ports consisted of 189 vessels. A year later it consisted of 173 vessels. The figure is now 163, which includes five laid up. I suggest that the problem is made even more serious by the fact that of the present operating B.T.F. fleet of 96 conventional wet fish trawlers 55 were built in 1951 or earlier. This means that 50 or 60 will have to be replaced within the next 10 years. New stern fishers cost about £500,000. The House does not have to be very good at mental arithmetic to calculate the total sum involved. It justifies the need, which the Minister has stressed, for both building and for increased operating subsidies.
924 I had intended to deal at some length with the question of how the subsidies are to be applied, because, as I have said before, there is very little information in the Bill. The Minister has now told us a little more. He has said that the basis for the assessment of efficiency and profitability, on which the whole scheme stands or falls, will be that of added value. I understand that means all profits, less depreciation and crews' wages. Has this formula, which obviously will have to be studied but which at first sight seems to be a reasonable one, been agreed first by the British Trawler Federation and, secondly, by the Scottish Trawler Federation?
§ Mr. Cledwyn Hughes
These matters are now being discussed, as I indicated in my speech, with the Federation and the union. I hope that there will be agreement on an added value formula very quickly. This is one of the difficulties of introducing details of the scheme in time for the Committee stage, but we will do our best on that.
§ Mr. Wall
I am grateful to the Minister for the amount of information he gave us today, because he will appreciate that Clause I contains very little information, as do the first four Clauses, which are the core of the Bill.
May I ask the Minister a question which arises out of this and which was asked in our last debate. He said that payments are to be made in arrears. How will this be applied to crew payments? They will obviously have to receive a bonus. Can this be paid in arrears, when the crew might have been dispersed? I admit that this is really a problem for the industry itself, but it is one which I hope that the Minister will bear in mind when he has these discussions.
The whole question of profitability and efficiency and the definition thereof is of very great importance to everyone in the industry. I stress that there has been a four-year review. I imagine that all these points have been thoroughly investigated and I hope that they will be agreed so that, as the Minister prophesied, payments will be able to be made early in the new year.
May I now—fairly briefly, I hope-turn to the question of imports. Surely there must be some relation between the 925 greatly increased foreign subsidies, particularly in Norway, where they rose by 57 per cent. last year and I understand have increased again this year, particularly in the case of dried fish, and in Denmark in respect of Greenland, and the increased volume of foreign landings in British ports. The value of all fish imports landed in the first eight months of this year is, I understand, £2 million more than that for the corresponding eight months of last year.
I admit that this is a difficult problem, because we must consider our partners in E.F.T.A. Some time ago the Minister told us that we were to have talks. He has told us today that those talks have failed. He has said that there will therefore be a 10 per cent. import surcharge on all imported fish, or is it only on the additional imported fish above the amount authorised under the Stockholm Agreement?
§ Mr. Wall
I am grateful to the Minister for clearing up that point. I think that he will agree that imports of processed fish this year increased by 55 per cent. in the first quarter, so obviously this is a matter which he has to consider very carefully indeed. Obviously we have to consider the statement made today and see to what extent this will redress the balance.
926 Speaking very much off the cuff, I do not think that this will cure the major difficulty faced by the industry, which is that of virtually unrestricted imports. Once again I ask the Minister—I have mentioned this in a previous speech—to bear in mind the Recommendation which the Select Committee made in paragraph 30(5) of its Report:Quotas, levies and minimum import prices to protect the British industry should be seriously considered and the matter pursued energetically with the E.F.T.A. countries.Today, we know that the Government have pursued the matter with the E.F.T.A. countries, they have not reached a satisfactory conclusion, and they have, therefore, had to impose unilaterally a 10 per cent. levy.
However, the suggestion of the Select Committee, as I understand it, related to long-term policy and the need to consider the whole future of the fishing industry on this basis. I say again that we are the only unrestricted market in Europe for imported foreign fish. Failure to act will have consequences for the taxpayer. The taxpayer will now have to pay up to £4 million on operating subsidies. The more imports we receive, the more the taxpayer will have to pay.
Will the Minister tell us whether, in his investigations and discussions with E.F.T.A., there was evidence to establish that dumping had taken place? There are methods of dealing with this problem, but I gather that definition is difficult. Perhaps the Minister who winds up the debate will say whether the question was gone into and what evidence was produced on either side.
May we be told also—I put this to the Minister in a previous speech—whether consideration has been given, in the context of the long-term problem of imports, to the policy now being put forward by the Common Market? In this connection, I quote three short passages from the Common Market document dated June this year. The first tells us that the Common Market policyestablishes a common system governing fishing in maritime waters.… The Member States ensure equal conditions of access and exploitation of the fishing grounds situated in maritime waters under their sovereignty or jurisdiction".Next:These measures have in view the reorganisation of fishing fleets, the investigation 927 of new fishing grounds, the provision of stocking and deep-freezing plants, qualifications, vocational retraining and stability of employment.The Minister has many of those matters in mind himself. My final quotation is on pricing:The price system lays down guide, intervention, reserve, reference and floor prices.If our European neighbours are developing a long-term import policy on those lines, we ought at least to take cognisance of it. We believe that the subsidy bill of the future could be cut if some long-term control over imports were established, including, perhaps, a variable import levy. We should very much like to know what the Government have in mind for curing the long-term problem as opposed to the short-term matters with which the Minister dealt today.
Now, the reorganisation of the industry. Reorganisation is needed not only because of the financial difficulties of the industry but because, as I said, 50 or 60 conventional trawlers will have to be replaced in the next 10 years. I understand that the Industrial Reorganisation Corporation is proposing an amalgamation of the 189 ships of Associated Fisheries, Boston and the Ross Group, which together land about 66 per cent. of British landings. This is open knowledge now as it has been referred to in public speeches by the chairman of the I.R.C.
What makes us wonder about such an amalgamation is that in 1966 the Monopolies Commission prohibited an amalgamation of Ross and Associated Fisheries. I understand that the basic ground for that prohibition was an objection to joint marketing proposals. But, surely, this is just what is now needed. There is a general desire to move away where possible from auctions. What is now proposed? If the I.R.C. is considering that amalgamation, how will it get by the difficulties already put forward by the Monopolies Commission?
§ Mr. Cledwyn Hughes
The proposals have not been finalised, and they have not been submitted to me. As I said, it would not be appropriate for me to comment at this stage.
§ Mr. Wall
I appreciate that difficulty, but the right hon. Gentleman will recognise that the matter is public knowledge and has been referred to by the chairman of the I.R.C. in public speeches. In the circumstances, it is right that the Opposition should probe the question. I hope that the Minister will soon make a clear statement about it. It seems to me that there are considerable difficulties attendant upon any such proposal. Perhaps, when he makes a statement, the right hon. Gentleman will assure us also that the small owner and small merchant will not be squeezed out by the formation of any new consortium.
In the same connection, there is the whole question of the relationship of the I.R.C. with the White Fish Authority. I understand that the I.R.C. would remain involved and that there would probably be Government directors appointed to the new company, if it matures. Thus, we should have two semi-State boards involved in one industry, which could lead to complications.
I come now to Clauses 2 and 4 of the Bill. We presume that Clause 2 is preparatory for the landing of boxed fish from factory ships and that Clause 4 might be the prelude to a statutory minimum price scheme. Will the Minister tell us what is proposed? The question has been before the House on many occasions, and we should like to know whether there is likely to be a statutory minimum price scheme with a Government financial contribution. Is it still being considered by the industry and the Government?
The industry operates its own voluntary minimum price scheme. That scheme was referred to the Restrictive Practices Court and was found to be in the public interest. I have here a letter from the Treasury Solicitor, acting on behalf of the Registrar, which reads:I confirm my telephone conversation to say that in view of the findings of the Court in the Distant Water Vessels Development Scheme, in relation both to distant water vessels and to near and middle water vessels, the Registrar does not propose on the basis of the agreement at present registered to contest this case further.Now, two years later, I understand that the Registrar is considering reversing his decision. Will the Minister look into this matter? Considerable difficulty and expense could be put on the industry's 929 shoulders; it went through a good deal last time, and one hopes that it will not have to face the same loss of time and money once again.
There are many important matters covered by the Bill which I have no time to discuss now, but I must touch briefly on the human aspect. Problems of safety at sea have been emphasised recently by the findings of the inquiry into the sinking of the three Hull trawlers earlier this year. There have been recommendations regarding weather reports, communications and stability. I am sure that the Holland Martin Committee will consider all those matters.
Here again, the basic problem is that of rapid replacement of the conventional trawler which is now becoming obsolete by modern stern fishers with better amenities. I commend to the Minister Recommendation 2 of the Select Committee:There should be encouragement of research and development into the mother ship system…Such a system might well be of help in improving safety at sea, and I hope that something is being done about it. Good safety and good working conditions go together and are of great importance. I understand that grants of 40 per cent. are available now for improving safety or safety devices. Both sides of the House agree that efficient ships are safe ships. As the Bill is based on the aim of promoting efficient ships, it will be of assistance from the point of view of safety.
The Minister dealt with a most important section of the Bill, that dealing with conservation, but I have no time to go into that now. I say only that we on this side recognise the problem as fundamental, not only for our generation but for future generations. We support the Clauses designed to promote some form of international policing system agreed by all nations and to bring into operation the agreement reached in 1967 for a Convention of Conduct in the North Atlantic. The right hon. Gentleman told us that 18 countries had already signed the Convention. I take it that they are already introducing legislation, as we are, in order to allow the Convention to be ratified? We shall do all we can to assist in that matter.
930 I sum up in this way. We believe the Bill to be sound, though it is basically a short-term measure. We note that the position will be reviewed in 1970 before the provisions of the Bill are continued into the 1971–72 period. We note that it does not deal with the inshore and herring fleets and, therefore, we shall have to have an annual debate on inshore and herring operations when the Order is tabled. We hope that this does not mean that we shall no longer have our annual debate covering all sections of the fishing industry. Back-bench Members on both sides regard such a debate as essential.
I have asked a number of questions, and I hope that the Minister will realise that we consider them important. A fundamental point is that we need more information on the proposed draft Order before we can give full consideration to the proposals in the Bill. Another is that we hope that the Government will let us know their thinking on the long-term problem of imports. The Minister will agree that his announcement today on the 10 per cent. levy is only an interim arrangement.
§ Mr. Wall
I do not deny that for a moment. This is an important Bill, which I hope will be of great benefit to the industry. But the Minister said that the Government were looking at the long term. The Bill has been in gestation for four years, and we hope that we shall eventually pass legislation that will last the industry for a long time. We do not believe that that is possible unless the long-term problem of foreign imports is fully tackled.
§ 5.11 p.m.
§ Mr. James Johnson (Kingston upon Hull, West)
I found the speech of my right hon. Friend the Minister very stimulating, and, as a Member for a fishing port with the biggest deep sea fleet in Western Europe, I also found it very encouraging. Unlike the hon. Member for Haltemprice (Mr. Wall), who damned the Bill with somewhat faint praise, I think that we are set fair for at least four years. The Bill gives the industry a chance to revive and build itself up, and I hope that a long-term policy will evolve long before the end of that period.
931 I have listened to fishermen in Hull for some years, and they have told me of the vicissitudes of the past, of the good times and the bad. For some years there has been pessimism in the fish dock among merchants, fishermen, owners and the like. Under the old conditions of laissez-faire capitalism, followed by the non-selective subsidy after the Fleck Report, we did not get along very well. In 1962 the present Joint Parliamentary Secretary to the Ministry of Agriculture, Fisheries and Food, my hon. Friend the Member for Edinburgh, Leith (Mr. Hoy) criticised the old set-up, and I believe that history will be on his side. That is why we are here today with this Bill.
The new policy has been warmly welcomed on all sides, despite the hon. Gentleman's description of it as "short-term". Spokesmen of all sections of industry in all the fishing ports have warmly welcomed it. For the first time, the Government have taken a good, hard look at the industry and given us a chance to get up off our knees, where some people thought we had been for some time. It gives hope to the fishing community.
It is pleasant, however, to note the attitude of the Opposition. In the debate on 24th July, the hon. Member for Haltemprice said:…we on this side of the House will support the Order and Scheme."—[OFFICIAL REPORT, 8th July, 1968; Vol. 769, c. 504.]No one says that fishing matters are non-political, but at least let them be non-party. Let us all work together for the good of our port constituents.
I was glad to hear the Minister's decision about a 10 per cent. levy upon imports of frozen fillets. Apart from being an economic factor, this is a very emotional factor in the lives of our people in the ports. I raised this matter with the E.F.T.A. Parliamentarians and again on the Floor of the Council of Europe, and it is very important that we consider the question of excessive landings. Perhaps it is not quite my right hon. Friend's pigeon, but he might press his right hon. Friend the President of the Board of Trade on the question of bilateral agreements and multilateral agreements, and heavy landings of foreign vessels on the Humber.
932 The Bill is mainly for the purpose of authorising new finance, and there are continuing discussions with owners and the unions about the future. Since the cash will be distributed on the basis of efficiency of the vessels, the question is which vessels are efficient and profitable. I hope that the "big squeeze" will now be on. Certainly I expect early elimination of the steam trawlers, many of which are in the 50 and 60 segment of the fleet that the hon. Member for Haltemprice spoke about. They must go, because of their age and the weaknesses of their design.
The next priority is to dispose of side trawlers, with all their hazards. This should be comparatively easy with the distant and middle water fleets, where stern trawlers have shown their superiority over the past year. I am thankful that in Hull, Mr. Mark Hellyer, the owner of the lost "Kingston Peridot", has scrapped her sister trawler, the "Kingston Sardius", which was fishing at the same time in the same waters as the "Peridot" went down some months ago.
My right hon. Friend said on 8th July that the best way of improving fishermen's conditions and wages was by making the industry prosperous and efficient—hence the legislation on which we are now embarked. In Hull we have a guaranteed fall-back pay of about £20 7s. But this wages question is one for employers and unions. I understand that the Transport and General Workers' Union will be meeting the Minister later this week on the matter. I was very glad to hear him tell us that the wage factor would not be used in estimating the "added value" in the catch. Am I correct?
§ Mr. Johnson
Decasualisation is taxing our minds on the Hull Dock. The industry is clearly moving towards decasualisation, and we have port registration schemes. From my knowledge of the Hull companies, ship's articles are now quite anachronistic. We are moving towards decasualisation in the companies, and later I hope that we shall move towards it over the whole field, know from my local union leaders that they are worried about the quality of the intake of men. That is why the Bill is so important. If the industry becomes 933 prosperous we shall have better wages and conditions and thus get a better intake of men, as happened in the coal pits after nationalisation. I gather that Lowestoft had somewhat of a shock with its advertising scheme in Birmingham, and that the quality of labour there is not all it should be.
Besides its financial measures, the Bill enables the White Fish Authority to seek regulations for the charging of the penny which is now imposed per stone, and its increase up to 2d. per stone of fish landed. I understand that the Authority needs more money, and we looked at its difficulties in the Select Committee. It is in debt at present. My view is that if we proceed with 2d. per stone there will be a big battle inside the industry, because the vessel owners and merchants that I meet do not think that they are getting value for money. We came to the conclusion in our Committee that we should abolish the White Fish Authority, or, if it could justify itself, give it more money to do its job properly. I find that Clause 4 speaks about this. I can only understand from this that the Minister's intention is to expand the White Fish Authority, for otherwise why include it in the Bill? Why have paving for anything if one does not intend people to walk on the pavement and be given solid support? However, we shall no doubt discuss this in detail in Committee.
What ever we may have said about the failure of the White Fish Authority to advertise, and increase the present static consumption of 19 lbs. per head per annum, and also to improve the marketing of fish; no one can deny the value of its effort in the field of research and development. I believe that it is doing wonderful work in that way, but find that skippers and men do not always use it to the best advantage.
§ Mr. Johnson
If the hon. Gentleman will allow me to make my own speech, I shall come to the I.R.C. in four or five minutes.
934 I welcome the remaining Clauses, 5–14, dealing with safeguards for fishing operations, inspection of foreign vessels and so on. I believe that this represents a big step forward. I hope I do not sound chauvinistic, but welcome the facts that we are asserting ourselves more internationally. This is an important step, and will please our fishermen, who have in the past complained about the depredations by alien vessels within the 12 mile limit and indeed outside it. Our fishery protection officers are now given power to board alien vessels.
I know that size of mesh and size of fish are Committee points, but I wish to say at this stage that there are some blatant offenders in the North Sea waters and well beyond. We need not go into the subject of industrial fishing, but the Communist States and France in particular are, in my opinion, guilty in this context. I am told that the French love to have small fish in their soups—bouillabaisse and so on. But this does not justify the extent of their activities in our waters. Conservation of stocks is so very important. The small fish become bigger fish, and one does not catch big fish, unless the smaller ones are allowed to become big.
I have been out, with the hon. Member for Haltemprice, on fishery protection vessels in the North Sea, H.M.S. "Letterston" and others, and I know what a good job these ships have done. I wish the Minister could coax his fellow Minister of Defence to provide a few more such vessels, to guard our waters from the entry of anti-social types from the Continent.
The Bill will shape for good or ill the future destiny of our fishing fleet, with all that this means for the welfare of tens of thousands of people in Fleetwood, Hull and elsewhere. It is extremely important that we should have it before us today.
I have touched on wages and industrial relations. What about the size, shape and structure of the catching fleet? As to the financial measures in the Bill, why has the I.R.C. been called in, as American efficiency experts have to the City of London? I believe that the vessel owners need advice. Whether the City of London does I do not know. However, I offer all credit to the B.TA. for the welcome 935 that it has given to this proposal by accepting this stimulant.
The I.R.C. must be more than a catalyst. I accept that view of my hon. Friend the Member for Goole (Mr. George Jeger) who a few days ago told the Minister that if one is to use taxpayers' money for footing the bill for the fishing industry or at least part of it, for modernising vessels and improving the conditions of the workers, there should be more public ownership.
For a long time—I note my colleague in Kingston upon Hull, North (Mr. McNamara) is with me in this—I have believed in a State Fishing Board. I want an efficient fleet with modern stern fishing vessels. One would expect their performance to be a yardstick to which others could measure up. Why do I want this? I have watched how in the coalmining industry with public ownership, public accountability and public servants we then achieved standards in safety and many other fields. I have in mind safe vessel design, working and living conditions on a par with the Eastern Communist fleets, such as those of the Poles, who sleep many fewer fishermen in a cabin than we often do; day-by-day terms of service; wage agreements; and so on.
I think that the Minister, as a Welshman, will agree that we never got adequate safety measures in the pits until we had the National Coal Board. So I want to see a State Fishing Board. This year's disasters dog us today in all our ports, although the vessels sailed out of West Hull. It is my belief that we shall never get daily contact between the vessels and the home base, and full manning, until we pass legislation insisting that we have qualified radio operators on the vessels and until we have a State Fishing Board with its vessels setting the pace in this way.
As a personal note, I have in my constituency a family which lost a boy of 15 years in those disasters early this year. It was less than six months after he had left his secondary school. In passing, I would point out—I hope that the Minister and all others who are concerned are listening—that when any young male under 18 is lost his family gets no compensation. This is why we 936 are so concerned and become emotional about safeguarding the lives of our constituents.
§ Mr. Kevin McNamara (Kingston upon Hull, North)
Would my hon. Friend not also agree that it becomes particularly heartbreaking when the person of 18 years or under is the only wage earner in a family and the widowed mother gets nothing?
§ Mr. Johnson
I could not agree more. My hon. Friend the Member for Kingston upon Hull, North and I are well acquainted with the homes of these people. This is why I emphasise the need for sufficient safety measure.
The subject of design is vital. It is not merely stern fishing techniques. We want side fishing as well, but it involves danger. We need more comfort for the men in all fields of this hazardous calling.
Stability of vessels is also extremely important. I am deeply grateful to Mr. Naisbett, Q.C., for what he said about this subject at the inquiry in Hull. We must eliminate the danger of trawlers being top heavy in Arctic waters because of the accumulation of ice. The hon. Member who represents the port of Fleet-wood is present. I visited the B.A.C. works at Weybridge some months ago to see a wonderful experiment in the test chamber there with de-icing equipment made by a firm in his constituency. It consists of putting a rubber sheathing on the superstructure. By this means, using compressed air, the ice can be fractured and dislodged. It is a very important development. I also commend the work of the National Physical Laboratory at Teddington on vessel stability.
The Bill is warmly welcomed by the industry. I again emphasise that there is continuing support for four years. As I see it, if the fleet is having a bad time we increase the global subsidy. The greater the efficiency of any vessel within the fleet, the larger its share will be, I imagine, of the global subsidy. This will weed out the weaker vessels in these days of ruthless competition.
We all know that the trawler industry needs a massive face lift. Only the Government can carry out this surgical operation. Traditionally the industry has been made up of individual units, and it still is. There are many family firms just as there were in coal mining or the 937 steel industry before nationalisation. No one doubts that lack of sufficient capital has been an important factor in the past. Without capital these units cannot move and plan ahead on equal terms with the subsidised fleets of Eastern Europe and Scandinavia. But I do not subscribe to some of the careless strictures of the B.B.C. in its documentary, "The Great Fish Muddle".
My constituents on the fish docks and at sea are hard-headed. They do not accept all the superficial comments of a programme like that. It is easy to use words like "archaic" and "quaint". What is the alternative to wet fish landings and auctions? I have never heard of one. With more deep freezers and more fish coming back in deep frozen condition, therefore, there will be fewer merchants but I cannot but see that the auctions will continue—perhaps with better quality fish—permanently for wet fish landings.
There is urgent need for vertical and horizontal integration—in other words, a merger. The merger must be large enough to have adequate managerial structure and to produce economies of scale. It must be large enough to organise expeditions to the South Atlantic—to new fishing banks. However, that is not as simple as the Poles and others make out. We shall get some unusual factors, not least sociological.
I cannot see many Hull wives being happy about their husbands leaving their families behind for six months on end as the Communist fishing fleets do. This is not a simple matter, although I accept that, if we are over-fishing the North Atlantic, we must go further afield.
I am told that discussions are taking place between the I.R.C. and the three largest deep water fishing companies—Associated Fisheries, the Ross Group and Boston Deep Sea. I believe that this would involve 180 vessels. But some of the firms have interests in poultry and frozen food. I take it that it is hoped to amalgamate the boats into one large fleet and I assume that amalgamation would also cover the frozen food side.
Expansion of the fleet into a size of this nature is clearly necessary. I am convinced that there must be more aggressive marketing methods from the quayside to the shop counter. We shall 938 see a much better fishing industry. Given that, and given decent working conditions for the men, I have no doubt that fishing will still, as in the past, be a job for men of courage and endurance, and no men have more courage and endurance than the fishermen. They have played a vital part in our island history. They are fine men with guts and they deserve the best we can give them. The very existence of our trawling fleet is at stake and I do not believe that the Government will let us down.
§ 5.34 p.m.
§ Mr. Walter Clegg (North Fylde)
It is always a great pleasure to speak in a debate after the hon. Member for Kingston upon Hull, West (Mr. James Johnson). He has a great knowledge of the fishing industry which extends over many years, and his views are, therefore, to be listened to with respect. He started by making a plea that we should discuss this matter in a non-partisan spirit but then suggested that we should nationalise the fishing fleet. He cannot expect us to follow him in that partisan view. I hope to reply to some of the points he raised.
I must declare an interest. As a solicitor practising in a fishing port, I act for people from all parts of the industry—trawler owners, fishermen and merchants. In particular, I have acted from time to time for one trawler-owning firm which I shall mention later.
As the Minister said, the Bill is a paving measure for a scheme which will give us the details and is part of an overall strategy. If we on this side criticise some parts of the strategy, it is not because we do not want the Bill—we do—but because both within and outside the industry there are different emphases on the best measures to be taken.
I appreciate that the Parliamentary draftsmen have produced a precise way in the Bill of achieving what the right hon. Gentleman wants and I am sympathetic to that point of view. On the other hand, to someone who is not an expert at reading Parliamentary shorthand—because that is virtually what the first four Clauses are written in—it is difficult to understand those Clauses because they must be read in conjunction with a Schedule. That is not easy and I suggest that there should be added a Schedule to relate in full the consequences of the 939 amendments to present legislation so that the ordinary person can understand the full effect of this Bill.
I want to deal not so much with the need for a subsidy—a case which has already been made out—but with the effects which the subsidy will have. The Minister said that, in itself, the subsidy would not solve the problems of the fishing fleet and he detailed the remaining part of his strategy, including some control of imports. Whether the 10 per cent. will be enough is a matter of judgment. Only time will tell whether it will have a sufficient effect. We must give the measures a chance and I welcome this Bill.
The question of reconstruction is still wrapped in mystery so I do not propose to pursue it. But I do want to discuss the question of a national minimum price scheme. The great difference here is between the English and Scottish attitudes. If it were left to the English major fishing ports there would not be much trouble in getting agreement. I can see my hon. Friend the Member for Edinburgh, West (Mr. Stodart) looking at me but what I have said represents the feeling in England.
Many parts of the industry feel that the future of the English industry at any rate cannot be viable unless a satisfactory minimum price scheme is introduced. This is something which the White Fish Authority, if it is going to be able to get more money from the industry, could pursue and which the Minister ought not to reject in full at this stage. It is well worth pursuing.
I come now to some of the practical effects the Bill could have. Safety is of great concern to all of us. I should say that there have been more attacks on the industry in relation to safety and other aspects during the past year than in any other year in its history. Some criticism has been valid. Some has been interesting in leading to improvements in safety. But some has been far from constructive, has not helped and has, indeed, created great resentment in the industry.
The subsidy will help safety because we shall not get safety in anything but a viable fleet and it is necessary to replace many of our trawlers with more modern vessels as soon as possible. How- 940 ever, something could be done more quickly with our existing trawlers, and I am anxious that it should be done this winter. The hon. Member for Kingston upon Hull, West said that if the fleet were nationalised, we might have better safety measures, but I am sure that he appreciates that private industry has great care and concern in these matters.
§ Mr. James Johnson
I was not casting any aspersions on any companies or individuals in the industry. I was saying that it has been our experience, in coal mining, for example, which I know well, that when there is a public sector with public accountability, there is much more invigilation and much more care, with more safety officers to look after this very important aspect of the work.
§ Mr. Clegg
I pay credit to the National Coal Board for what it has done about safety, but even the Coal Board can make miscalculations which lead to disaster. Many industries have a good safety record, including private industries.
The question is what can be done to make the ships safe, if possible, during the coming winter. The hon. Gentleman has already mentioned de-icing procedures. The hon. Member for Kingston-upon-Hull, North (Mr. McNamara) and I attended an exhibition of de-icing and what we saw there shows what can be done and done quickly. During the recent inquiry in Hull, it was reported that one of the Board of Trade surveyors said that de-icing was a very complicated and expensive business. I am not so certain that that is right.
§ Mr. McNamara
The hon. Gentleman said that it was a Board of Trade surveyor, but that is not my recollection. Unless he is certain, he ought to say that it was a witness.
§ Mr. Clegg
That was my recollection, but if I am wrong, I willingly withdraw. Certainly a witness said this at the inquiry
Within a week of the disasters of last winter, a firm, B.T.R. Limited, which is close to but not in my constituency and which manufactures de-icing equipment for aircraft, suggested to Boston Deep Sea Fisheries Ltd., which operates from Fleetwood, that it had a device which might help with de-icing. Within another week that equipment had been fitted and 941 a trawler with it had left for the fishing grounds. Since then and with the full cooperation of the Boston company, which the other companies concerned readily acknowledge, and with the co-operation of I.C.I. and the British Aircraft Corporation, which provided research facilities, this type of de-icing has been extended not only to the masts, but to the bridge superstructure by using rubber panels.
In addition, I.C.I. has now produced a non-stretch rope to replace steel ropes which will prevent the formation of ice, or make it easy to get rid of ice in severe icing conditions, because it needs only a slight vibration. The object of this, as with all de-icing equipment, is to bring the ice to deck where it can be dealt with. The estimated cost of this device is about £3,500 for the average trawler with another £250 or so for the standing rigging, and, in the context of operating costs and with the Government grants which would be available, this is a very limited amount.
The "Boston Phantom" under its skipper Mr. Rawcliffe has received permission to operate in Icelandic waters and it is hoped that as soon as the icing conditions are appropriate final field experiments will be carried out. I hope that the Board of Trade will keep in the closest touch with these developments, for it is on the cards that our ships could be fitted with this device during this winter and before the weather gets too bad. The hon. Gentleman and I were told that the material was available to do a very quick job on equipping the whole fleet.
One of the criticisms of the industry concerns its marketing. With frozen fish being landed in cartons and coming ashore more and more as other cargoes, there is a new dimension to the whole marketing problem and large units may be needed to handle this side of the operation. There has also been much criticism of the smaller merchants and the smaller firms. I have a feeling that, so complicated is the industry and so varied the demand in parts of the country, there will always be a place for the small men, but only if they combine with each other to make themselves more efficient. This can and has been done. Not long ago, under the "Beeching Axe", British Railways did 942 away with its fish train service at Fleet-wood and the merchants had to provide themselves with methods of getting fish fresh from Fleetwood to other parts of the country. Without any outside help, they built up their own fleet of modern refrigerated transport which now takes Fleetwood fish to various areas throughout the country. This is an example of private enterprise tackling the problem and of small people combining to overcome it. The difficulties in their way are not of their own making but result rather from Government legislation controlling transport, and we do not yet know what will be the effect of the new Transport Act.
I welcome the Bill and look forward to seeing it in Committee and particularly to hearing about the details of the scheme. I am worried about how efficiency is to be defined. Two trawlers, each efficiently equipped and with a good crew, could go to sea and one could land its catch in a good market while the other, just as efficient, could land its catch in a bad market, making a bad price. What would be the test of efficiency then? It would be the difference in the markets rather than the crews or vessels which produced the difference. The only solution which I can see is for the trawler firms to manage to have their ships come in at the right time, and there will then be even more communication between shore and sea to ensure that they do so.
I hope that the Bill is a step in the right direction, but I am not entirely convinced that without an upsurge in world markets this and the other suggested measures will be enough. I hope that they will be, because we all want the fishing industry to be a viable proposition as soon as possible.
§ 5.50 p.m.
§ Mr. Donald Dewar (Aberdeen, South)
It is very pleasant to find ourselves again considering the fishing industry and indeed an important piece of fishing legislation. It is right that it should have come first on the day's Parliamentary menu, even though our start was rather delayed.
The fishing industry is extremely important nationally and extremely important to the constituencies involved in it. It is an industry apt to be unusually dominant in those towns dependent upon it. 943 The Bill is something of a mixed bag but basically it falls into two parts. I do not intend to deal with Clauses 5 to 14 at any length, because in a sense they are uncontroversial and will be accepted by both sides of the House. I would just say in passing that there are points of substance and a large number of details to be ironed out, not only in terms of the operation of fleets, foreign boats in our waters, but also fishing limits. This was brought home in North-East Scotland recently by one comparatively small, but not unimportant incident, which took place in waters off the Isle of Man.
I do not want to labour the point at any great length, but the House will be aware that two boats from Peterhead were arrested for pair trawling, an activity carried out in a way which would have been perfectly acceptable and legal off every other stretch of the British coast. The two vessels were run in, if I may use that phrase, by British boats and heavily fined. In correspondence with the Under-Secretary of State for Scotland I have made it clear that I find this a somewhat Ruritanian and ludicrous situation.
I am interested in Clause 21 to see that there is provision for Orders in Council relating to fishing limits off the Isle of Man. I recognise that this may be a fit matter for discussion by the Constitutional Commission, mentioned in the Gracious Speech. Some of us however are not prepared to wait four or five years while this Commission comes to a conclusion. I hope that the Ministry will be prepared to be more flexible than it has so far indicated in its attitude.
I know that the Under-Secretary told me in a letter that he did not consider it a major factor in the future activities of these boats. That is what he suggested. Certainly the local skippers to whom I have talked take a more serious view. They have not been happy with the view that it is not practical to open negotiations with the Isle of Man authorities.
The Herring Industry Board has said that there is a possibility that this will be a considerable difficulty in future years, and that boats can be expected to be fishing in Isle of Man waters from the beginning of August, when the herring shoals are still within the three-mile limit. I gather that the Herring Board 944 is approaching the Manx authorities with a view to having the 1965 Act, which was enforced by the Ministry's fishing protection vessels, changed. If it is possible for the Herring Board to consider this it is right that the British Government should also consider this matter. It may not be a large issue, but it is important to the skippers and crews concerned. I accept that in the context of this debate it is a small issue.
§ Mr. Patrick Wolrige-Gordon (Aberdeenshire, East)
I would like to take the chance of reinforcing, especially from the point of view of the future, the remarks of the hon. Gentleman about the very serious nature of this issue for the work of the Scottish fleet. I hope that the Government will take this up.
§ Mr. Dewar
The hon. Member and myself are entirely at one on the importance that a number of local groups attach to this, and I hope that we will have some action when the Government have time to consider it further.
This is to some extent an aside. The main section of the Bill deals with the new subsidy scheme. It is sweeping away the outdated and very restrictive machinery set up by the 1962 Act, and obviously in future our debates on the fishing industry will no longer be bedevilled by the sadly impractical vision of a fleet that was to be viable by 1972. It is quite clear from the wide-ranging nature of the speeches that the subsidy system is not necessarily the only factor affecting the future of the near, middle and far distant fleet. We have heard a great deal in previous debates and this afternoon about imports of white fish. There is enormous room for import saving here. Most of us have welcomed the announcements we heard from the Despatch Box of the 10 per cent. surcharge.
There is also the matter of the minimum price scheme. I saw in the Press on 1st November a speech by the Chairman of the White Fish Authority in which he stated again his conviction, and presumably the conviction of the Authority, that a medium price scheme, properly organised, was an essential basis for the future prosperity of the industry. I accept that, and as far as I know everyone in my port is prepared to go along with it. One point which is always 945 raised, and I accept it, is that there was opposition 18 months ago from a certain section of the industry and indeed there still is opposition. I am not convinced that this cannot be removed by the right Government action and Government acceptance of the need for some sort of financial support for a scheme.
I notice that the Chairman of the White Fish Authority said that it was waiting for a decision by the Government in this matter before it could go on to make up its mind. If there is a case of waiting for a decision I hope that it will not be postponed indefinitely. I have gained the impression, perhaps unfortunately, from what has been said in the past that the Government are waiting for the W.F.A. to make up its mind, while apparently the W.F.A. is waiting for the Government. At some time we have to get this resolved and I would like to see some action soon.
There is also the important matter of the rather mysterious activities, so far undefined, of the Industrial Reorganisation Corporation. No one would deny that there is an enormously important area for the I.R.C. here. The fishing industry needs restructuring, and there is enormous scope for increased efficiency. I am glad to hear that the I.R.C. has been twice seen in Aberdeen, and has had a number of sessions with individual firms. I hope that when the reports and recommendations finally appear there will not be overdue stress on the unique problems of Hull, Grimsby and the deep sea fleet, but that it will be remembered that there are other ports, with important industries, which are not deep-sea ports, but which are still very much in need of encouragement and reform.
The essential theme of the Bill is the new subsidy scheme. What we are told is what we already knew—we have the global sum and the important question is how that sum is to be divided. The announcement about the subsidy, when it was made in July got a good response from the industry, and it deserved to. Rapture has been qualified since in some quarters, understandably. No Government ever gives enough, and I appreciate exactly why some people have reservations about arrangements that have been made. Obviously if the industry is compared with the situation in agriculture, 946 with that in some other countries, Norway for example, we are not being treated in a particularly princely way.
One or two ingenious people have sent me calculations to suggest that if over the last three or four years we applied inshore subsidy rates to the hundredweights landed by the Scottish trawler fleet, it can be seen that the fleet would have come out rather better than was the case. This is now behind us, and we accept the global sum as a starting point. The argument left is how we apply this principle which we welcome and accept, of efficiency. It is of particular importance, not only because the fishing fleet will get better returns, which will mean lower prices for the customer and greater viability, but it will also mean greater safety, something in all our minds after the recent disasters.
Efficiency is an extremely difficult concept to measure. I have a great deal of sympathy with what was said a few minutes ago by the hon. Member for North Fylde (Mr. Clegg) about bad markets. This is a hunting industry and there are all sorts of variables and difficulties. Obviously there must to some extent be an element of lottery here. The Minister gave us some basic, skeleton information, which was welcome, as to how the added value was to be calculated for an individual vessel.
As I understand it, it was to be a matter of taking a vessel's earnings and deducting from this the costs. This was to give the added value to which the size of the subsidy for the vessel was to be geared. That raises the question of how one defines costs. Here again the Minister was helpful and he made it specifically clear that costs were to exclude the wages bill. There is doubtless a case for this but it is causing some concern in certain quarters. If we are going for efficiency, obviously use of manpower is one factor in the efficiency quotient. It may be a point that if we exclude wages and say, in effect, that the subsidy bears no relation to the crew ratios and the manning of the vessel, we are possibly excluding an incentive for increased mechanisation and more efficient methods of handling fish and catching on the grounds. Although I recognise that there are arguments on the other side, I am not entirely happy about the exclusion of wages as such.
947 I recognise that it is possible to say that if we include wages we are saying to the owners, "If you keep your wages down your subsidy will go up", and that there is already a strong natural tendency for any owner to want to keep his wage bill down, which will be increased. We accept that the wage structure is, in many respects, too low and that if we are to get over manning difficulties and to give men a proper return for the tremendous efforts which they put in to the industry we do not want to discourage a proper share for them. I accept that if we give a built-in incentive to hold down crews we may be striking at the safety factors.
But I am not convinced that these are conclusive arguments, for a number of reasons. I hope that the industry would not be averse to higher wages if they were geared to greater productivity in the labour force. This is very much a matter for the unions and the employers to negotiate. I am not sure that the added twist of allowing wages to be included so that the wage bill has some relation to the subsidy is such an enormously important factor as to outweigh the general argument that wages, which are an important element of any added value figure, should be included as an incentive to modernisation.
Although I know—and this point can be fairly made—that labour relations in my port and many other ports have not been of the best—I still meet antedeluvian, positively nineteenth century attitudes to labour relations and a very paternalistic attitude to the men and the industry among many owners—there are signs of improvement, and I should like to hope that we are moving towards a much more flexible era. If the I.R.C. gets in among the industry and brings about the kind of rationalisation which we want, presumably the situation could greatly improve. Manning ratios are laid down by agreement between the unions and the owners. I do not see why we should not leave it to the unions to ensure, as they are perfectly capable of ensuring, that before they drop the minimum manning from ten, eleven or twelve men per boat, depending on where it fishes, the safety factors have been properly considered and that there have been improvements made in the catching equipment, 948 and so on, to justify it. On balance, I am less than happy with the suggestion that wages should be excluded.
Turning to the question of finance, I unashamedly represent a sectional interest. This is a point which will come specifically from the Scottish Trawlers Federation. I am worried about the way in which it looks as though the new formula will work out for the Scottish trawling fleet. Take the results from the Scottish fleet in the years 1964, 1965 and 1966 and the percentage of total subsidy which went to that fleet and compare this with the proposed scheme of which the Government are thinking. During those years, the subsidy as a percentage of the total which would have been paid applying the proposed scheme would be less than it was under the old scheme. This is obviously an unsatisfactory situation because it suggests that over those three years—and this may not be representative; I am willing to listen to arguments about this matter—if the proposed arrangements had been operating the Scottish fleet would have done worse than it did under what everyone recognises as an ungenerous scheme which is now being abolished with the blowing of trumpets and great shouts of a new deal for the industry.
Taking the years from 1964 to 1967, if the proposed scheme had been applied in terms of proportion of total subsidy the Scottish trawling fleet would have received less than the percentage share of operating profits which it contributed. I do not say that these figures cannot be misleading and I should certainly not like to have to fight the case on 1967, when the Scottish fleet did not feel the same squeeze and did not have the same profits dip which the British fleet as a whole suffered. I should not expect a section of the fleet which represents only about one-sixth of the whole to get the proportion of the subsidy which exactly corresponds with the profit which it turned in in such a freak year. If we did, we would be claiming about 50 per cent. of the total subsidy available, which we all realise is hardly practicable.
But there is a serious case for saying that with the proposals, as they appear to be emerging from Government thinking, over the last few years the Scottish fleet would come badly out of the calculations. This is not a situation which 949 gives much cause for comfort in my part of the world. It is fair to point out that on the figures on which I am working—I do not think that they are widly inaccurate; they have been repeated in the Press—the Scottish fleet would have received just under £650,000 if the new subsidy scheme had applied last year. In 1962, it received £644,000. In other words, we would have been getting just about the same figure as in 1962.
Taking what seems to be the balanced and disputable argument put forward for the exclusion of wages and looking at what I tentatively suggest seem to be the indications of the financial results, I think that the Minister will accept that there is a case for considering again the results for the Scottish fleet. We shall all be looking very carefully at the scheme when it emerges, but there is certainly a need for reassurance on the points I have been discussing.
§ 6.8 p.m.
§ Sir John Gilmour (Fife, East)
The part of Scotland from which I come is not connected with the deep or middle water fishing parts of the industry, but I think that all those who have the interests of fishing at heart see the industry as a whole and do not particularly want to take a narrow view one way or the other, although they are naturally interested, as the hon. Member for Aberdeen, South (Mr. Dewar) was, in the particular problems which face the fleet fishing out of Aberdeen.
I was interested in the arguments which have been adduced about how the subsidy can be developed on an efficiency basis. Obviously, we do not want to use money to keep in being trawlers which are out of date in their fishing methods. But when it comes to such questions as how much bigger reward one boat out of two equal boats should receive, how does one judge efficiency? One thing which affects the industry so much is climatic conditions. Two equally efficient boats may go to sea and one may be fortunate in the weather which it strikes and the other unfortunate. One thing which governs how long boats have to remain at sea is to ensure a proper return, and sometimes perhaps the subsidy should be used to enable them to return rather than remain at sea. I am sure that the Minister will agree 950 that the weather is taken into account when agricultural subsidy payments are fixed. I do not know whether that can be done for fishing.
Something which is of particular interest to my part of the world is the fact that the Bill, in Clause 4, I think, makes provision for increasing the payments which are to be made to the White Fish Authority. Presumably these will apply equally to the inshore fleet as they do elsewhere. Therefore, the whole industry will bear these extra payments. This question is tied up with whether enough money is being spent on research and development.
According to the last report of the White Fish Authority for the year to 31st March, 1968, the general levy raised was £487,000. Out of that, the White Fish Authority paid £212,000 and the Exchequer £225,000 for research and development. The total that went into research and development during the year, excluding special items which occurred, was just under £440,000. On the face of it, it does not seem to me that this can possibly be enough to deal with the problems of developing an industry which has an important rôle in the import-saving context, to which the Minister referred.
One could equally say that unless the people who pay the White Fish Authority levy feel that they are getting value for money, there will at once be an outcry. I therefore wonder whether a sufficient amount of money can be raised in this way for the necessary research in the fishing industry, especially when one considers the many problems which have to be solved and the many new methods which are bound to come into use in future.
We get fishing legislation so rarely that unless one takes the opportunity when legislation is presented to cover all the possibilities, it is extremely difficult to make the alterations which, possibly, the Minister in charge at the time would like to make. That is why I am particularly interested in the provisions following Clause 4 of the Bill which deal with conservation and on which we must look to the future.
What one has read in some of the technical journals of the fishing industry, 951 and what has been said of the fears expressed recently at a conference in North America of what was termed the vacuum-cleaning fleets of Eastern Europe and the effect that they would have on fishing stocks, makes it all the more necessary that in the provisions of the Bill we cover the maximum number of points.
Perhaps I am ingenuous, but it seems odd to me that we can pass legislation allowing us to extend our jursidiction over what is known as the Continental Shelf in the North Sea so that we can conduct exploration and extract oil, and yet we appear to be unable to control fishing over the same area. I do not, of course, claim that simply because fishing has taken place in these areas by every nation from time immemorial, whereas exploration for gas is quite new, we have the right to say that we can extend each country's limits over the whole of its Continental Shelf area.
There must, however, be a need to see whether, by international agreement, something cannot be done to ensure that fishing is carried out in the interests of the countries which abut the ocean. The Minister appears to be shaking his head, but there is to my mind a certain aspect of piracy by people who are prepared willy nilly to scoop up all fish irrespective of where they come from. I feel that there is real need to try to reach international agreements to control and improve the prospects for fishing.
As to the work that needs to be done for research in inshore fishing, I am sure that there are many things that the White Fish Authority could do to extend the types of fishing that are used. It was only about eight or ten years ago when fishing for prawns around Scotland was considered to be of no economic value. The situation has changed and I suppose that that has now become one of the more valuable parts of the inshore fishing industry, and one has been pleased to see large catches landed recently in certain ports.
Other types of fishing are likely to be developed only if research and development is devoted to them. I am interested to see that experiments have been carried out in the West of Scotland in growing mussels on ropes. I was interested to read that the Japanese are carrying out 952 a breeding programme with a shellfish of which I have never heard but which is called an abalone, which, I believe, is known in the Channel Islands and can be extremely valuable.
Unless the White Fish Authority can help inshore fishing in the expansion of technical effort to improve the new types of fishing, we will not be likely to keep abreast of future development, in which there may be a change from what has amounted to fish hunting by boats going out to hunt the seas back to an attempt to farm the seas, so that by the planting and feeding of fish in certain areas we can reap a much richer harvest from the seas. I therefore give the Bill every welcome and I hope that it reaches the Statute Book at the earliest possible moment.
§ 6.16 p.m.
§ Mr. Kevin McNamara (Kingston upon Hull, North)
If I may deal briefly with the point made by my hon. Friend the Member for Aberdeen, South (Mr. Dewar) concerning wages and the new proposed formula, I think that this is a matter which might be decided between the unions and the employers. This is an agreement which is concerned essentially with industrial relations.
I suggest, however, that some of the points made by my hon. Friend were based on doubtful propositions. My hon. Friend mentioned the question of manning scales, for example, but not the long hours—16 or 18 hours—which fishermen work. Therefore, before we introduce more efficient methods, we are entitled to ask what hours the fishermen work.
One could go through a whole number of factors to argue that while the point made by my hon. Friend may be of interest in Scotland the matter is one which should be left to the employers and the unions. The unions are most concerned in questions of manning and safety to work out what is best for the men.
I listened to the point made by the hon. Member for North Fylde (Mr. Clegg) concerning a minimum price scheme. It appears to me the whole object of the exercise of the formula as announced today is to lead to a minimum price scheme if we are to get a proper realisation of what should be the profit or return at the end of the day. Unless it can be based on a minimum price scheme, no matter 953 what tariff we have for E.F.T.A., we will be left almost completely to the vagaries of the market. It is important to have a sound basis on which to make our calculations.
When we last debated the fishing industry at the end of the last Session, I said that the time-scale problem of the industry covered four main points; first of all, the immediate subsidy to help the industry in the difficulties which it has faced. Secondly, I dealt with the question of reorganisation. I mentioned negotiations with E.F.T.A., the general social conditions under the Merchant Shipping Acts and the Holland-Martin Report. I am proud that it is the Government of the party to which I belong which has this year introduced a degree of security and social reform to the industry. That is shown by the announcement in the Gracious Speech that the Merchant Shipping Act is at last to be brought up to date and the fact that we have had the first part of the Holland-Martin Report.
Having said all that, however, I still think that we are, in a sense, debating Hamlet without mentioning the Prince. Until we have information on two main points—what is to be the effect of the 10 per cent. tariff on E.F.T.A. imports of frozen fillets and, secondly, what shape the industry is to take as a result of the Industrial Reorganisation Corporation—we are no surer about what our industry is to be like. I welcome very much the introduction of the I.R.C. into this industry, and I have been somewhat disappointed to hear the sceptical comments made about it this afternoon. I think that the I.R.C. deserves the faith and credit which the Government had in it when they introduced it. However, I wonder whether, because of the rumours we have heard, because of the statements we have had, what is to happen to those three large firms. We should have an early statement. Is it true that they are not really interested in the marketing side? We really need a statement about the intentions of the I.R.C. in the industry. It is absolutely fundamental.
We have had today the basic outlines of how this scheme will work, and I know that negotiations are still going on with the unions and the employers about the scheme. These, I hope, will come to a speedy and suc- 954 cessful conclusion because it will be very important in trying to work out what the scheme will mean for the industry as a whole, in wages for crews, in particular, by which we shall judge the success and intentions of the Bill.
As it stands at the moment, I think both sides of the House are agreed that it is a follow-up to the morale booster which the Government gave to the industry when last July they announced their generous intention to increase grant. This has resulted in improvement in the morale of the industry, and has given it a greater sense of security, but the spur has now gone, and we want to see from the details of the scheme exactly where we are going and to make sure we are looking forward to a very prosperous future.
I have for a long time felt that the crisis which exists in the fishing industry has been 50 per cent. human and 50 per pent, economic but that the solution to it is 100 per cent. economic. I should like, therefore, to put a number of points to my hon. Friend the Joint Parliamentary Secretary to answer, if he will be so good, when he replies to the debate.
There is, first, the suspicion, voiced in particular by my union, the Transport and General Workers Union, that the operation of the new subsidy structure might to some extent have an effect the reverse of that intended, namely, that the subsidy, being based on profitability and efficiency, may encourage the retention of older trawlers, which are mainly conventional, and have less safe working conditions, but are landing wet fish and, therefore, are more profitable than the more modern freezer trawler which is not so profitable because of foreign competition.
We know that we have within the industry a two-tier structure—the modern vessels, and a part of the fleet which is very old. Figures have been mentioned today. What I am afraid of, and what my union is afraid of, is that, because of the way the new subsidy will work, it being based on fishing efficiency, we may have the retention of the older vessels for longer than we want to see bearing in mind our history over the year of landing wet fish. Therefore, I should like to know whether, under the new scheme, there may be a tailing off 955 of the way the subsidy is operated so as to encourage a more rapid replacement of the older vessels.
We have two main grounds for the subsidy. We have first the operating subsidy, and secondly the building subsidy. Both are very important, but we seem not to have the degree of flexibility in the subsidy structure one would like to see. We have only to look at the O.E.C.D. report on the various types of subsidies given in other countries, ranging from Canada with subsidies for new techniques, to Germany with loan interest reductions, to see how the different countries have different manners of applying their subsidy structures. I wonder if we ought not to look at the question of subsidy being applied both to improve efficiency immediately and also to provide for long-term developments which may take place.
One of the most important and most welcome things that the Government did when they broke fresh ground two years ago was, for the first time, to give allowances for the introduction of safety equipment in the building of ships, and a grant towards the improvement of ships from the safety point of view. Could not there be under this new subsidy on the operating side more incentive to include provision for safety?
I would like to think, because of the way the account had been worked out, on both the debit and credit side, that a tremendous contribution could be made to the social welfare of the crews, if part of the subsidy were paid not only for the time a ship is operating but also for the length of time it is in dock to give the crew a reasonable time at home in port.
Obviously, many of these suggestions will be tied up with the recommendations which the Holland-Martin Committee will be suggesting considering when looking at all the different facets of the industry, but these things are so interlocked that it is impossible to talk about the subsidy and not talk about working conditions, marketing, organisation of the industry, and so on. It is inevitable, but perhaps I cannot expect to get today all the answers I want. However, they ought to be borne in mind when looking at this problem.
956 There has always in the past been a suspicion that the Government subsidy has been used in part to diversify the interests of the trawling firms, apart from helping the industry. I would like to think that we shall have precise, accurate and greater control of the use of the subsidy to make sure that this suspicion is not substantiated.
Turning to the Bill itself, I have a couple of things I should like my hon. Friend to reply to if possible. In Clause 2 we have for the first time in a Bill a specific mention of fishmeal and other products, If the subsidy is used in the flexible and imaginative way it can be used both for the development of factory ships and for a tremendous amount of import saving. Thus this aspect of Clause 2 is particularly welcome. It is important that we try to cut down on imports of fishmeal. It has often surprised me that the Government have not done this sufficiently in the past, to encourage our own protection of fishmeal, when we hear so often of fish being thrown overboard because it is not edible or saleable on the English market and now when there has been development of cold storage. If we had adequate fishmeal factories at sea, then, when there are gluts of fish, the fish could be put into cold storage to be consumed later.
Clause 4, and I am a great believer in Clause 4, deals with the extra levy which the White Fish Authority is given power to impose. This is most important when one considers the future of the White Fish Authority and Herring Industry Board. For the life of me I cannot understand why it is necessary to have two Boards when they might be amalgamated. Each is complementary to the other. There could be savings in salaries and administration costs and also research could be undertaken jointly.
Leaving that as an aside, when the Select Committee considered the White Fish Authority it came to the conclusion that it could be either strengthened or scrapped. The Government have decided that it should be strengthened and have given it money for that purpose.
I should like to quote from the evidence which was given by the Transport and General Workers Union to the Holland-Martin Committee, and concerning the White Fish Authority. On page 8 of its evidence the union made this point, 957 which is important because it underlines the basic weakness which has always existed in the White Fish Authority:Another cause for concern arises from evidence that where commercial, design and safety advances have resulted from research, often by the W.F.A., owners have been reluctant to co-operate in experiments and to implement successful projects. In correspondence with Sir Frederick Brundett of the W.F.A., we learned that an offer to experiment with transferring at sea, boxing and superchillmg has not been received very well by owners on Humberside. The offer from the W.F.A. was on favourable financial terms for experiments involving four or five vessels. We quote Sir Frederick's letter on other research projects:'The above is not the only case where the results of the Authority's Research and Development Programme have not been implemented as fully or as rapidly as they could be; we believe for instance, and have some reason for doing so, that more general use of warp tension meters would help skippers to improve their performance. We agree, however, that it would help if there were better arrangements to instruct skippers in the use of instruments and techniques already developed. This would be more effective in the short-term than acceleration of the development of the simulator-trainer: in that project we have first to develop the tool and then find out if it is successful. We believe that a comparison of the performance of individuals and of company fleets shows that better training of skippers is one of the most immediate practical steps the industry could take.'The White Fish Authority can do a tremendous amount of good, as it has done, in its research, but it has never had the power to see that its findings are adopted. This has been its major weakness, and is one reason why it has been regarded with such suspicion. I would like the White Fish Authority to be strengthened for the purpose of research, and the subsidy to be geared in part to the acceptance of recommendations on the fully carried out experiments of the White Fish Authority. Their recommendations should be listened to, to find out what advances can be made, and then the subsidy should be granted.
I agree with my hon. Friend the Member for Kingston upon Hull, West (Mr. James Johnson) that we should have a publicly owned fishing industry, or that at least part of the industry should be publicly owned. This would act as a pace setter for the rest of the industry. I made this point in the debate last July. It could work not only to develop the techniques which emerge from the White 958 Fish Authority and others but also to find new grounds and new methods. If the experimental side were separated from the commercial side and if the White Fish Authority were paid for the experimental side and the rest of the company existed on a commercial basis, then this would provide a pace setter for the industry and a way of finding out what improvements could be made.
Clause 5 deals with the adequate marking of fishing boats and their gear. Paragraph 26 of the Report of the Court of inquiry on the loss of the St. Romanus states:In December, 1964, in the Formal Investigation into the loss of the SAREVA the Court recommended that consideration should be given to the question as to whether there should not be some better method of identifying liferafts. As a result of this recommendation various methods of identification had been discussed between the Board of Trade and representatives of trawler owners, but no satisfactory solution had been agreed, and as far as could be ascertained the matter had been dropped. In the opinion of the Court there is really no excuse for such delay. Since the loss of the ST. ROMANUS the Hull Mutual Insurance Society have put into operation an arrangement whereby each liferaft when serviced in addition to its number should bear the words 'Hull, England'. In this case once the correct number of the liferaft was known in Hull it was only a matter of minutes before it was identified as coming from the ST. ROMANUS. It is appreciated that the marking on the liferaft must be on the liferaft itself and not on the outer casing…The Court still feels that further consideration should be given to this matter, but the method adopted above is a good interim solution.Will Clause 5 lead to the implementation of this recommendation of the Court? The Bill was, of course, drafted before the finding of the Court was published last week, but this is one thing which has come out of the tragedies which could be implemented very quickly in the Bill.
Reference is made in the penal Clauses to the confiscation of the catch and to penalties incurred in breaking the regulations. I realise that this is an international agreement and is traditional, but very often the wages of the offshore fishermen or ordinary fishermen are related to the size of the catch, and he will therefore lose a share of his wages. This would be acceptable if that person bore full responsibilities for selecting the area where the vessel fished or the type of gear used, but on many vessels this is 959 the responsibility of the captain. This could have particularly unfortunate results. I know that this is the traditional method, and it is sometimes argued that these people can make their point of view felt. Although this is probably more a Committee point, I felt I should mention it here because it is something which I shall seek to raise in Committee.
Recently Hull has given a general welcome to the Holland-Martin Interim Report, the proposal for the mother ship, the weather report and so on, but there are two points on this which are important. The Court of Inquiry into the St. Romanus recommended that wherever possible a ship should go to sea with a qualified radio operator. This is something which we all would like to see. I hope that the Board of Trade, which has generally accepted the interim report, will ensure that when a ship goes to sea without a fully qualified radio operator there is on board a person, other than the skipper, with a radio telephone certificate. This is an important interim matter which could be introduced quickly. Many men who sail as mates while holding a skipper's ticket hold that qualification, and this would be an added safeguard. The other point concerns the stowing of life rafts forward when members of the crew live in the fo'c's'le.
Much could be said on the subject of training, pay and recruitment of crews but perhaps we should wait for the full report of the Holland-Martin Committee.
I have in the past been critical of the owners. Therefore, I welcome the widely reported decision of Associated Fisheries to stop their skippers fishing north of Iceland from 1st December to 31st March, whilst stability tests are being carried out at the Admiralty yard at Yarrow. This is a most important decision, and a right decision, which is welcomed. It will put a financial strain on the firm and it is right that we should recognise this. I hope, this decision having been made by Associated Fisheries, that other firms in the industry will follow suit.
Mention was made in the Court Report on the Ross Cleveland of co-operation between all sides of industry on safety matters. Paragraph 28 of the Report states:It is clear from the evidence adduced in these three inquiries, namely the St. Romanus, 960 the Ross Cleveland, and the Kingston Peridot, that it is of the utmost importance that the owners and builders of trawlers should cooperate wholeheartedly with the Board of Trade on questions affecting the safety of trawlers and that no one should delay or sit back when any question affecting the safety of trawlers and their crews at sea is raised and rely upon someone else to take the initiative. There was evidence of some such co-operation in the past, but there was also evidence that it had not always taken place. Furthermore, in the opinion of the Court it has been demonstrated that there is need for all parties in the fishing industry, owners and builders of trawlers and of skippers and crews, to play their part in making what must be a hazardous occupation as safe as possible.I am sure that hon. Members on all sides of the House would agree that we need this type of co-operation extended and improved upon so that what is undoubtedly a hazardous occupation may become as safe as man can make it.
That brings me to what the hon. Member for North Fylde (Mr. Clegg) said about the de-icing experiments which are being conducted, at a cost of about £3,000 a vessel for the superstructure and bridge, and, for rigging, £40,000 for the whole fleet. We hope that there will be an early decision about it so that we may have the degree of safety in our fleet that we should all like to see. It has immediate effect and, in terms of the cost of replacement of vessels, entails expenditure of a very small amount.
The Bill is an important one for the people of my city. It is one which we welcome and which makes us very proud of our Government.
§ 6.41 p.m.
§ Mr. John Nott (St. Ives)
I am conscious of the fact that this Bill is mainly but not entirely concerned with the deep-water fleets. There are Clauses in it, however, which can apply to the inshore and middle-water fleets, and I want to mention one or two aspects of the Bill which relate to the type of fishing carried on from my constituency. The aspects of the Bill which are relevant are, first, the White Fish Authority Levy and the increase which is anticipated; second, Clause 5 and the regulation of fishing operations; third, Clause 15 and the shellfish regulations; and, finally, Clause 16 and conservation.
We in Cornwall, with our fleet concerned predominantly with inshore fishing, recognise that the problems of the 961 deep-sea fleet are considerably greater than ours at the present time and that the Bill is needed badly for trawlers operating from Hull, Aberdeen and elsewhere. We recognise that yields have declined with intensive international competition and that deep-water trawlers have been shut out of many of their traditional fishing grounds as a result of the extensions of the fishing limits. We recognise, too, that imports have created a considerable problem for the deep-water fleets although, to some extent, they have done the same for the inshore boats. For example, the import of canned goods has had a serious effect on pilchard fishing, and we need some system of variable levies, on a long-term basis, to protect our fishing industry from imports of this kind. These items, and the substantial subsidies granted to our competitors, who are also our trading allies, have put our deep-water fleets in a serious position, with the result that the trawlers have been making little or no profit over many years.
For that reason, I welcome the Bill. It seeks to assist one of our greatest, most risky, most adventurous and at the same time most unrewarding industries—the fishing industry.
As I have said, compared with the problems of the deep-water fleet, those of the inshore and medium-water fleets are not so serious at the present time. Nevertheless, I suggest that the experience of the inshore boats has been uneven, and there are parts of the inshore fishing industry which are going through great difficulties.
I come then, to Clause 4 and the White Fish Levy. I am sure that the Minister is aware that the introduction of minimum prices would be most unpopular in the South-West. I know that the Parliamentary Secretary is well aware of it. If the Levy is to be increased by a penny a stone, there will be tremendous opposition from fishermen in Newlyn and Brixham to any minimum price scheme affecting them. I can understand their fears. They fear that the tendency would be for market prices of fish to come down towards the minimum price; this would be catastrophic for the South-West. If there is any move towards a minimum price scheme, I hope that the South-West will be excluded from it.
In a way, I wish that the Secretary of State for Economic Affairs were present 962 because we recognise that the problems of the inshore and medium-water fleets are often social ones, while in purely financial terms they are small besides the problems of Kingston upon Hull. Nevertheless, the prosperity of inshore fishing is vitally important to communities and whole areas of the South-West and Scotland. For that reason, I would not like to think that the increased subsidies which are to go to the deep-water fleets will in any way reduce the amounts available for inshore boats. I realise that the inshore subsidies are calculated on a basis entirely different from those in this Bill. I hope that they will continue to be reviewed annually in the light of the widest economic criteria and that, as is the case now, the subsidy will not be subject to automatic reduction as the years go by.
In this connection, I am concerned primarily about any increase in the subsidy to deep-water trawlers having an effect on the total allocation to the fishing industry generally. I have no doubt that the Minister has great good will to the inshore fleets as well as to the deep-water fleets, but I am concerned lest the Treasury and other Government Departments might not at some time in the future lake away from the inshore fleets some of the increased allocation now to go to the deep-water fleets. The Minister will be aware of the widespread anger and concern recently when the inshore subsidy was cut. It arose in the changeover from stonage rates to daily rates, and I know of several inshore boats which suffered cuts of up to 50 per cent. in their subsidies as a result.
Although the inshore fleets have the great advantage of landing fresh fish and, in that sense, are not so concerned with imports as the deep-water fleets, nevertheless they have great problems which offset their advantages. First, their transport costs are higher, and they have been increased substantially by taxes on commercial vehicles and now by the terms of the Transport Act. Second, there is little scope for freight rebates, because inshore ports have not the same bulk as Aberdeen and Kingston upon Hull and, therefore, cannot get the same concessions on the railways as deep-water ports are able to obtain. Third, the small amount of capital possessed by most inshore fishermen and the narrow 963 margins on which they operate make them very vulnerable to misfortune, whether it be damage to their boats or their gear.
I do not need to stress to the Parliamentary Secretary the vast importance in the west country of our shell fisheries. They stretch in my constituency along a coastline of up to 100 miles. It is due to the shellfish industry that a great number of communities are able to survive and to maintain an adequate living until the summer months come round, when many hon. Members and other visitors descend on Cadgwith, the Lizard and other coves and villages. The livelihood of these places is, to some extent, kept going during the year by the shellfishing industry.
The Parliamentary Secretary knows that, over many years, we have had a very great controversy over free diving for shellfish; and that this activity still continues. I have never been one of those who wished to see regulations introduced prohibiting underwater fishing for sport and recreation, and I know that my hon. Friend the Member for Haltemprice (Mr. Wall) agrees with me on that point. What I should like to see is a limit, but not a ban, put on professional skin-diving for crayfish.
A good diver can take between £200 or £300 a week diving for crayfish in the season. I do not grudge him that return, because his is a tough and dangerous occupation, but I, and everyone connected with the industry down there, believe that one cannot have fishing on this scale without there being repercussions on the stocks. No one would claim that stocks of shellfish are being completely depleted, but one can claim that, although the stocks are not being extinguished altogether, the effect is to reduce below an adequate level the standard of living of the many communities which depend on shellfishing for their livelihood. This is a serious problem, and I wish that the Ministry would recognise it. This controversy has gone on for many years without progress being made.
§ Mr. Nott
I am aware that the British Sub-Aqua Club support the need for some regulation in this connection.
I mention this matter because, although the Minister could have dealt with it in another Bill, there are Clauses in this Bill dealing with conservation, and I think that he could have taken power to make regulations for lobster, crab and crayfish fishing. That power would have come logically within this Bill. In addition, the Measure contains no power to regulate the size of shellfish that may be taken from the fishery limits in the British Isles.
I asked the Ministry this morning whether, in Clause 16, the description "seafish" could be so defined as to include shellfish. I am sure that the Minister is aware that the area around Cornwall and Devon is a very prolific shellfishing ground for the French, and it would have been quite logical to broaden the definition in Clause 16 so as to include shellfish as well as seafish. In my part of the world, the crayfish is often quite a large fish, but there are also some very small crayfish caught which are the breeding stocks of the future. These crayfish are mainly consumed in France—they are hardly eaten here at all; 90 per cent. of them are exported to France which takes them from Newlyn and other harbours. I believe that the definition should be widened to include these shellfish.
I appeal also for the inclusion of shellfish in the white fish subsidy. A crab or a lobster is now no more of a luxury than a turbot or a sole, which now receives a subsidy, and in social terms the importance of the shellfish industry to this area is immense. How much evidence, and what kind of evidence, does the Minister require us to provide to enable him to consider the point again?
I believe that, in logic, the Bill should have given some formal powers to local sea fisheries committees, which are trying to regulate fishing on the spot. These bodies include representatives of practising fishermen, who know their business. The committees could do a great deal to assist the Minister and the Ministry in helping to regulate some of the matters set out in the Bill. I wonder whether Whitehall is, perhaps, a little over-jealous of its powers, some of which could well 965 be delegated to local sea fisheries committees which are able to implement regulations and help the sea fisheries officers in their task.
The local position of these committees could be regularised by the granting to them of the status of corporate bodies which, for legal reasons, would be enormously helpful. Again, it would be a great help if these committees were empowered to establish reserve funds for capital expenditure and for repairs and renewals. The present position is that they are financed by a precept on local authorities but are not permitted to set aside any part of the precept to reserves for the purchase of office accommodation or capital equipment.
The sea fisheries committees could be empowered to contribute to local lights, fog signals and other navigational aids for the benefit of inshore fishermen, and also for the benefit of medium water fishermen of other nations. Further, why cannot these committees spend money on removing obstructions from inshore fishing grounds? That point must come within the context of such a Bill as this, because what to us are inshore fishing grounds are deep water fishing grounds to other nations and there would be some reciprocity in this respect.
I believe that the local fisheries committees should have powers to institute licensing systems to control the taking of shellfish, just as I have suggested that the Minister should include such powers for himself in this Bill.
Why does not this Bill increase the statutory maximum penalties for infringement of local sea fisheries committees' byelaws? The present maximum penalty is £50 for a first offence or £100 for any subsequent offence, except where a vessel is wrongly used, when a second offence may involve a fine of £150. It would be reasonable to empower these committees, which help the policing of our waters, to impose a fine of substance upon a foreign vessel caught infringing our rights, rather than having these purely nominal fines of £50, £100 and £150.
Finally may I ask the Minister would the subsidy given in Clause 2 to fish products be available also for the establishment of a fish meal plant which would be used by inshore fishing boats? I know that this Bill is predominantly meant for 966 the deep water fleet, but presumably the powers to grant subsidies for fish products could also be used for the establishment of a meal plant in Cornwall for the inshore boats. The pilchard fisheries were once vitally important to Cornwall's economy, but they are now going through very difficult times and, although there are still plenty of pilchards there, the market for them is dwindling. It is taken up with imports from other countries. There is an ever-increasing need for a processing plant to can and cure pilchards in the South-West and also to take all the surplus fish and offal for reduction to oil and meal. I admit that Clause 2 is mainly related to deep-water fisheries, but could it not be used to provide a subsidy for such a processing plant?
This Bill is primarily concerned with the deep-water fleet, and we welcome it in the South-West, but here the Minister has an opportunity to take some powers which we have been pressing him to take for months and sometimes years. They could easily be slipped into this legislation as it goes through the House and I trust that he will do this for our benefit.
§ 7.0 p.m.
§ Mr. Alick Buchanan-Smith (North Angus and Mearns)
One thing which characterises our debates on fishing is the problem of distinguishing between short-and long-term improvements in Government policy towards the fishing industry. The kinds of aid which can be given to the industry we discuss on the one hand in the context of short-term policy to get the industry through a difficult period and out of its present problems, and on the other hand, with a view to helping its long-term economic position.
It was hoped that when the previous scheme was accepted the industry would be able to stand on its own feet. Now, by this Bill, the Minister is setting up a scheme whereby we hope that the industry will reach the stage at which it can stand on its own feet. Unfortunately, over the last few years with these schemes we do not seem to have got much further forward in putting the industry on a sound footing. I am sure that it is the aim of all of us who have the interests of the industry at heart to see that it can stand on its own without the need for schemes and subsidies of this sort. We 967 should like to see an economic climate in which the industry can prosper with its own resources. One may use the comparison with the agricultural industry. Most farmers would like their industry to be able to stand on its own feet and to get a proper return on capital to cover operating costs without the constant need to go to the Government for a major part of its income.
That is why it is so important to view this Bill, not only in the narrow context of the fishing industry itself, but in the whole context of the Government's food policy. The Minister is discussing in the Department and with the Government the whole question of Government policy in relation to agriculture, whether there should be greater dependence on import control and the possibility, I understand, of going on to a levy system which would have the effect of raising the price of food. That would have immediate repercussions on the fishing industry. If the price of food were raised, which is a critical matter in discussion of a levy system on imports in relation to agriculture, automatically the price of fish would rise with the rise in the price of meat.
For this reason it is important that when we are discussing the fishing industry we should know more of what is in the mind of the Government and of the Minister about food policy generally. If there were a change in agriculture policy we could create prices for fish which would help to extinguish the subsidies which we are now discussing. This would be one way in which the industry might be able to earn from the market sufficient to cover operating costs and to give a reasonable profit and a reasonable return on capital. I do not know whether the Minister intends to give us an inkling of his thinking on this tonight, but we know that he is considering the report of the "Little Neddy" which has important implications for this subject.
We look forward to hearing the Minister's thoughts on this subject before the Bill has passed through Committee. Then we shall be much better able to assess the future of the fishing industry, with reference to the return it can hope to earn from the fish sold in British markets. This is important not only with reference to the long-term thinking of the 968 Government, but, as the Minister admitted this afternoon, we have to face the question of a levy to combat dumping by other countries. The Minister referred to a 10 per cent. subsidy with reference to fish fillets. We have to live with this problem in relation to fish and agricultural products. Therefore, we should like to know about the Minister's thinking in terms of import control and whether he intends to put a higher duty on some of the foodstuffs brought into the country.
I hope that—perhaps not this afternoon, but certainly in Committee—we shall hear more about the Minister's long-term thinking on food policy.
§ Mr. Buchanan-Smith
With every respect, Mr. Speaker, I am relating this to the Bill which is before us. If we could know what the Minister's policy is for food that could have a big bearing on the question of the kind and size of subsidy which the fish industry will need. It would also have a considerable bearing on whether we think the proposals put before us can help the industry in the long term to be put on a more secure footing. I hope that we shall be given some indication of where the Government stand in relation to this problem.
Taking the narrow view of the industry itself, everything in this Bill in relation to the subsidies the Minister proposes follows on the question of the value-added formula. This factor is absolutely critical. The Minister, quite rightly, is trying to encourage the efficiency of the industry. That is in its long-term interests. I apologise if I did not follow him absolutely. I was not sure precisely where depreciation costs come into the value-added formula. Are they taken as part of the operating costs and therefore taken into account before value-added is considered, or are they taken into account in the residual part with wages and profits to management and so on?
This is important because, if depreciation is taken into account in the operating costs, that will lower the value-added for more modern boats. They have a higher depreciation and this will increase their operating costs and reduce the value-added and reduce their qualification for subsidy. I am sure that it is in our 969 interest to encourage the efficiency of the industry and we must be absolutely clear on which side of the equation depreciation charges come. Only in that way can we be certain that modernisation, which we all want to help, gives the encouragement to the industry which we all want to see. We shall not get modernisation in the fishing fleet unless it has a good return on capital and unless we ensure that those sections which are forward-looking and prepared to experiment and to put money into new techniques are not penalised in any way.
On a slightly more general point, I should be interested to hear from the Under-Secretary exactly what discussions the Government have had with the Scottish Trawlers' Federation on the working out of the formula. I should like to know also when the Government hope to get agreement about it. The Minister said earlier that he was not sure when agreement would be reached and when he would be able to give us a better indication of the details of the scheme. Scottish Members on both sides have pressed strongly for an absolute assurance that Scottish interests have been consulted. The hon. Member for Aberdeen, South (Mr. Dewar) went into this in detail. I support his strongly expressed hope that the Scottish fleet will not suffer either in relation to the United Kingdom fleet or in relation to the situation it enjoyed previously.
There are two specific questions to which I would like answers. First, we know now that the subsidy is to be paid on the basis of returns of individual boats. I can understand that this will involve much paper work and administration in calculating exactly what the returns are. The Explanatory and Financial Memorandum, under the heading "Financial effects of the Bill", states:No additional administrative expenditure is expected in paying subsidies under the new scheme for the deep-sea fleet.I should like that to be expanded upon. Basing the subsidy on individual boats could make more administrative work. Why do the Government think that no additional administrative work will be involved?
My second question arises on Clause 13. which deals with the compensation which a court can order a convicted 970 person to pay to an injured party. The limit of compensation has been fixed at £400. Why has this sum been selected? The kind of offence that could be committed, involving gear and other things, could result in damage or injury to a much greater extent than £400.
Finally, I had intended to say something about the inshore fishing industry and also about the shellfish industry. All the points I had intended to mention have already been made by my hon. Friend the Member for St. Ives (Mr. Nott). I support everything my hon. Friend said. I hope that in the passage of the Bill we do not forget the interests of the inshore industry, which is very important in Scotland as it is in the South-West of England, as indeed is the shellfish industry—the fastest growing section of the industry in Scotland.
§ 7.13 p.m.
§ Mr. Anthony Stodart (Edinburgh, West)
We have had a debate which I think in Scotland we would describe as "douce" on an industry which, though not very large, is an extremely important one. It is not only important economically as a potential saver of imports. Goodness knows that is important today. It is important as a supplier of protein and as a very substantial instrument of employment in many areas. It is an industry which contains some of the staunchest spirits in Britain. It would need to have had these spirits in view of some of the slings and arrows which it has had to endure. One has only to recall the state of things in Hull and Grimsby on a visit which hon. Members on both sides of the House paid last year to know that.
What interests me is the similarity of the situation tonight to that which existed on 14th November, 1961, almost precisely seven years ago. At that time the industry was in very severe difficulties and facing a very grave situation. I can well recall the hon. Member for Edinburgh, Leith (Mr. Hoy) emphasising the considerable losses which had been made then by the middle water fleet.
Developing this argument of similarity, I remind the House that last year the Scottish trawling fleet, if allowance was made for depreciation even at the wholly unrealistic rate of 6⅔ per cent., made a loss of over £100,000, a loss which 971 was turned into profit only by the injection of £206,000 of subsidy. Not one port from which trawlers operate in Great Britain, not even a single section of the fleet using any one of those ports, was able to show a profit in 1967 after it had deducted that modest and artificial 6⅔ per cent. As my hon. Friend the Member for Haltemprice (Mr. Wall) told the House, averaged over the whole fleet the loss on every vessel was over £18 a day.
The second similarity is that seven years ago the House decided on an extremely radical change of policy from what had existed up to that date. Precisely the same holds good tonight. It is both frustrating and fruitless to go into the reasons for having to make the change. Hon. Members opposite have claimed, and they claimed at the time, that the Fleck policy, as it has become known, was wrong and never could work. One cannot in all fairness bring a charge against right hon. and hon. Members opposite of being wise after the event, because the misgivings then were expressed in the debate on that night by the hon. Member for Leith and by the present Leader of the House.
Let it not be forgotten that that policy was based on a considerable amount of thought and consideration to very difficult problems, given by the late Lord Fleck and his Committee, and that those considerations received the approval of what one might call the experts—the British Trawlers' Federation. Would Lord Fleck have made those recommendations, would the B.T.F. have agreed with them, if they could have seen ahead to the invasion of this country by the frozen fillet and other imports, to the steep rise that has taken place in interest rates, to an increase of £900 per vessel in insurance premiums, and to the surcharge on fuel not many years ago which had the effect of virtually wiping out the profit made by a vessel? It is impossible to say for certain what they would have done, but I should have thought that it was unlikely.
In reply to my hon. Friend the Member for Haltemprice, the Minister said that the details of the new scheme were still being discussed. Will he confirm that the principles have been broadly accepted— 972 I could not put it wider than that—principles, incidentally, which are not described in the Bill but which were outlined to the House by the right hon. Gentleman before we rose in July and explained in more detail today? Have they been broadly accepted by both the Trawler Federations? I take it that discussions have been held separately with each body.
§ Mr. Cledwyn Hughes
The principle of a subsidy geared to efficiency has been accepted by the industry and welcomed by it. It is the detail which has to be worked out now.
§ Mr. Stodart
I am obliged to the right hon. Gentleman for that assurance.
The other similarity between tonight and that night seven years ago is the voicing of misgivings by Opposition spokesmen. At that time, misgivings were expressed by the hon. Member for Leith and by the present Leader of the House. Tonight, it is only right that we on this side should put on record the reservations which we have.
It seems to me that just about the only difference between the background to this debate and that of seven years ago, apart from the basing of proposals then on all the thought and consideration which had been given to the problem by the Fleck Committee, is that the details of the policy then appeared in the Bill whereas on this occasion we are at a disadvantage in that, until the scheme is published, we cannot constructively give approval or otherwise to what the Minister has in mind.
I am sure that much thought has been devoted to the new principle of giving the most subsidy to those who do best. But none of the details appear in the Bill, whereas at the time of our debates on the 1962 Act the correspondence between the Government and the industry was put in the Library for all to see, setting out the manner by which aid was to be given. The starting rates of subsidy on the different vessels were all agreed and given to the House, the percentage reduction rates were set out in the Bill, and we knew precisely what we were talking about. We are given nothing tonight except references to the scheme which the Bill enables the Minister to make.
I have a fairly long experience of subsidies, and my views on subsidy are by 973 no means universally shared in farming circles. In my view, it is good in principle to link Government aid to productivity. Therefore, if subsidies are to be given to the fishing industry, and if this is the way in which it is proposed to carry the industry along, I do not quarrel with the principle of the Government's plans. But I am by no means convinced that this is the right way, and I am certain that the Government's plans would not work as they want them to work if imports, most of them heavily subsidised, were allowed to carry on flooding in.
Unless the Government can steel themselves to control imports effectively, the same will happen with the fishing subsidies as has happened with some farming subsidies: the amount paid in subsidy may rise but the incomes of those for whom the subsidy is intended will fall.
Neither the old system of subsidies nor the new one can possibly achieve its objective so long as the amount of fish sent for making into meal rockets upwards as it has done this year—a fourfold increase at Hull and tenfold at Grimsby. There is no hope for the right hon. Gentleman's new ideas so long as imports are allowed to rise as they have—18 per cent. in the first quarter of this year compared with the same period a year ago.
The right hon. Gentleman will remind me, no doubt—I am surprised that he has not done so already, and I congratulate him on his tolerance—of the 10 per cent. duty on frozen fillets which he announced today. My hon. Friend the Member for North Fylde (Mr. Clegg) thinks that this is a move in the right direction. Broadly, I agree, but I am by no means convinced that it is adequate. For instance, what is to stop a country which is at present sending imports to us merely subsidising further by 10 per cent., paying the 10 per cent. duty, and coming back precisely to where we are now?
I must say that the right hon. Gentleman chose a slightly unusual method for announcing an important step of this kind. I mean no discourtesy to him, but one would expect an announcement about an import duty to be made by the President of the Board of Trade. Second, will he tell us whether the action which 974 he has taken is unilateral, or has it been taken within the framework of the E.F.T.A.? Is he satisfied that the action which he has announced is not in breach of our E.F.T.A. agreements? We ought to have that matter squarely on the record.
Both hon. Gentlemen opposite who come from Hull have said that the prospect of a change in the subsidy system has acted as a tonic to the industry—either a tonic or a spur, which comes to much the same. I beg leave to doubt that it has done that. What is still lacking in the industry is confidence. Until we see the scheme, trawler owners do not know what they will receive, and they are extremely hesitant to invest because they have not the faintest idea of what is likely to come to them.
§ Mr. McNamara
The hon. Gentleman seems to think that confidence can only be expressed by the owners. The workers in the industry have an important place in our considerations, and the unions have warmly welcomed the Government's proposals.
§ Mr. Stodart
The giving of a welcome does not necessarily mean that confidence is there as well. All I am quarrelling with is the suggestion that the industry is bursting with confidence. I am a little doubtful about it.
We now know a little of the detail of how the subsidy is to be calculated, but it is a complicated subject and it would be absurd for me to try to comment on it or criticise it now before we see the scheme in black and white.
§ Mr. James Johnson
Has not Mr. Austen Laing, the spokesman for the B.T.F., warmly welcomed the proposal and said that it is a step forward? If that is not an expression of some confidence—giving a welcome and recognising it as a step forward in the industry—I do not know what confidence is.
§ Mr. Stodart
I have a suspicion that Mr. Austen Laing's confidence would probably depend on the absolute certainty that, in addition to the scheme, imports would be firmly controlled. We are by no means certain of this, even with a 10 per cent. duty, for the reasons I have given.
A point made by my hon. Friend the Member for North Fylde rang a bell 975 in my ear. He spoke about the uncertainties of markets, of fish landing on a good market and then landing on a bad market. Knowing the uncertainty of selling fatstock, when one makes shillings per cwt. more if one is number five in the draw as compared with being number 15, I can understand his feelings.
The hon. Member for Aberdeen, South (Mr. Dewar) and my hon. Friend the Member for North Angus and Mearns (Mr. Buchanan-Smith) raised the question, which I wish to emphasise, of our being satisfied that the trawler fleet in Scotland will receive a proportion of the new subsidy equivalent to its share in the profits made by the British fleet. It is of the utmost importance that it should, because, although I fully appreciate the importance of a profitable fishing industry to Hull, Grimsby and other English ports, there would be a catastrophic effect on Aberdeen or Granton if the industry there went into a severe decline. This was a point which the right hon. Gentleman made early in his speech.
I should like to say something about the position of the inshore fleet. No debate on fishing would be complete without a mention of pilchards, and normally we get it. I could understand the anxiety expressed by my hon. Friend the Member for St. Ives (Mr. Nott). I have refreshed my memory on what the Minister said on 8th July, when he pointed out that the inshore fleet had done much better than the trawler fleet, but that to encourage expansion subsidies would be maintained during the coming year. He added:There is no question of cutting subsidies for the inshore fleet."—[OFFICIAL REPORT, 8th July. 1968; Vol. 768, c. 58.]The right hon. Gentleman should leave no ambiguity on that point. I presume that he meant that there was no intention of cutting them in the coming year, because that was the context of the previous sentence. He knows very well that there was no timetable similar to that laid down for trawlers suggested by the Fleck Committee or included in the 1962 Act. But percentage cuts in operating subsidies have been made, and there have been very severe ones since 1964. If they were to continue, the inshore fleet 976 would quickly find itself at a considerable disadvantage as compared with the trawlers.
I have said that if the Government introduce legislation to help the fishing industry out of its difficulties we should do nothing to delay its progress. I believe that my right hon. Friend the Member for Grantham (Mr. Godber) has also said that, and it is an assurance that I willingly repeat. If the Ministers will help us in Committee, for example, by letting us have a foolscap draft of what they have in mind, and if they realise that we are genuinely anxious to help the industry and that our questions and Amendments have that object in view, I am sure that we shall make progress. I presume that the Committee would probably start a week on Tuesday. If the right hon. Gentleman found it difficult to let us have a draft next week, I give an assurance that if the Committee were put off for a week we should try to make up time, as a reward for his consideration in letting us have the scheme, which is, after all, the basis of the Bill.
I realise that in what I have said about being anxious to be of assistance I may well incur the displeasure of the hon. Member for Kingston upon Hull, North (Mr. McNamara), because I recall his saying that he was not a bit happy when a bipartisan approach was made, even to fishing problems. But I rather think, judging from what he said today, that the hon. Member for Kingston upon Hull, West (Mr. James Johnson) would support my qualified welcome to the Bill and sincerely hopes that it will work. I have put fairly and squarely on the record my misgivings, which are largely confined to whether the control of imports announced by the Minister today is adequate. But we certainly hope that the Government's action will be for the benefit of an industry whose interests all hon. Members have at heart.
§ 7.36 p.m.
§ The Under-Secretary of State for Scot-Sand (Mr. Norman Buchan)
Never before have I heard a qualified welcome given in such sour tones. Some of the speech of the hon. Member for Edinburgh, West (Mr. Stodart) was a little at variance with the general welcome given to the Bill from both sides of the House. If my hon. Friend the Member for Kingston upon Hull, North (Mr. McNamara) 977 complains about bipartisanship, he is usually helped by the hon. Gentleman, who ensures that it does not occur.
The hon. Gentleman said that the main difference between the Bill and the Fleck policy was that we were placing the Opposition at a disadvantage, because we did not have the full details in the Bill. I believe that the main difference between this and the 1962 Bill is that though the then Government had the details in the Bill what it contained was progressive reductions, while we are concerned with strengthening the position of the fishing industry over the next five years by giving a guarantee of a subsidy related to earnings. The reason that the scheme is not in the Bill is that it is important that we discuss as fully as possible what form it should finally take, against the background of the necessity for speed. I should have thought that hon. Members opposite would accept that. We want to introduce the scheme as quickly as possible, and the simplest way is to get the Bill through.
The hon. Gentleman is being a little disingenuous when he suggests that he does not have some notion of the nature of the discussions going on with the trawler-men, because examples have been published. There was a headline in The Times of 31st October saying, "Trawler-men welcome Government backing". I do not know what hon. Members opposite mean when they say that though something has been welcomed, that does not necessarily mean that there is confidence. The report underneath that heading says:The new Bill to give continued support to the deep sea fishing industry referred to in the Queen's Speech yesterday, was warmly welcomed by the British Trawlers' Federation last night. Austen Laing, director of the Federation, said the continuing subsidy and the general approach to the problems of the industry were appreciated and would probably contribute to re-structuring.The report outlined some of the points the Federation seems to think we have been discussing. In view of that and the statements by my right hon. Friend outlining the basic approach, based on efficiency and the concept of added value, the hon. Gentleman is disingenuous to say that there is no inkling of what the scheme may eventually contain.
There has been a general acceptance by both the British Trawler Federation and the Scottish Trawler Federation that the 978 new subsidy proposal should be linked to efficiency. I was surprised that someone thought that Aberdeen might have missed out. Aberdeen trawler-men and the Scottish Trawler Federation made quite sure that their points of view were made known by meeting me in Edinburgh.
§ Mr. Stodart
It is not disingenuousness on my part. I returned to this country only on Monday. I could not get The Times and its report of the Queen's Speech abroad. I wish to ask the hon. Gentleman whether the welcome to which he referred has not been conditioned by the control of imports, to which he did not refer.
§ Mr. Buchan
Not in The Times. I am sorry, but I cannot keep up with the hon. Gentleman's perambulations in various parts. I would, however, refer him to that issue of The Times, which was dated 31st October.
One of the great pleasures about fishing debates is that, no matter what Order or Bill is before us, we generally have a very thorough investigation of the whole industry. I may have to stray a little out of the context of the Bill in order to deal with some of the points raised. This is what gives such a debate its own peculiar pleasure and salty flavour.
§ Mr. Buchan
That was a self-imposed order. I will do my best, Mr. Speaker, to remain in order. As to whether or not we give an additional outline of the draft scheme in advance, I am advised that we cannot bring the scheme forward until the Bill has received the Royal Assent. We cannot put it before Parliament for an affirmative Resolution until then. But this is not a consideration that prevents us from saying that we will go into the scheme. We are considering a whole number of details with the industry, and when they are settled we will consider the possibility of making an announcement to meet the point raised by the hon. Member for Edinburgh, West and others.
Subjects raised in the discussion were the basic formula and the global sum, and I have been asked about the effect of the new level of subsidy on crews' earnings. Subsidy earnings are at present 979 taken into account by means of a formula agreed between the parties in the industry for calculating the earnings of the voyage which qualify for poundage. Under the new arrangement subsidy earnings will not be related directly to particular voyages. It will be a matter for negotiation within the industry as to the proportion that the subsidy will bear to gross earnings. When the subsidy earnings will be paid is again a matter for negotiation between the parties.
The point was raised as to the effects of this on the Scottish trawler position. My hon. Friend the Member for Aberdeen, South, in his usual extremely skilful fashion, has put a careful slide-rule over the figures for the past. He suggests that if the formula had been in use over the years 1964 to 1966 the Scottish deep sea fleet would have had less aid than in historical fact it had under the 1962 Act. This is marginally true. However, it is based on certain assumptions and we do not accept the assumptions. One is that the history of 1964 to 1966 would be repeated exactly. The distribution formula will have the effect suggested only if the Scottish deep sea fleet is in future and in general less successful in producing the value added that we have been talking about, and, incidentally if it is more profitable. One of the bases of the argument is that it will be more efficient. If it is more efficient it will benefit and not lose by this scheme. So it does not seem that my hon. Friend need have anxiety on that score. The more efficient the fleet is the better it will do.
§ Mr. Dewar
On the basis of figures that I have, in 1967, which was by far the most successful year in comparative terms, the Scottish trawler fleet produced 49 per cent. of the total profit of the British fleet, but the gap between what it got as a proportion of the subsidy and what it contributed as a proportion of operating profit widened. So I am not happy when my hon. Friend says that the better it does the more it will receive.
§ Mr. Buchan
I know the point, and I know that my hon. Friend is not happy about it, but it is based on the conditions as they existed then and other factors which have been taken into consideration. I think that the comparative profit shown by that section of the fleet 980 will be continued in the future and that it will benefit from the new basis.
That having been said, the Federation has its own ideas, and very powerfully puts them forward, as to how the money should be distributed. We shall be giving full consideration to the views of the industry, including those of the Scottish Trawler Federation, before deciding what should be put in the statutory scheme. I do not think that hon. Members or the industry will want to interfere with this concept of full discussion and careful attention to the views expressed.
§ Mr. Stodart
The hon. Gentleman has said that the proposals have been welcomed by the British Trawler Federation. Have they been welcomed by the Scottish Trawler Federation?
§ Mr. Buchan
The Scottish Trawler Federation is very happy that the scheme should be based upon efficiency because it believes, correctly, that it is very efficient. That is not to say that it has not put forward in detail bases on which the formula should be calculated slightly different from those put forward by other sections of the industry and the Government in discussion. That is true, but by and large it accepts that the scheme should be based on efficiency. What it is questioning are some of the points that might be suggested by others for a criterion of efficiency.
Some of my hon. Friends have wondered whether the wage aspect would be affected by the criterion. We can see the reason for the exclusion of a criterion because of its effect on safety factors or because we do not want to have a written-in squeeze upon wages. If there is an increase in wage costs, it will decrease the operating profits by the amount of that increase. So the two will balance, and the value-added sum which draws the subsidy will be the same. It will not affect the entitlement of an individual vessel. The division of subsidy as between profits retained by the company and crew earnings is a matter for negotiation between the two parties.
Reference was made to the inshore fleet. It is not of itself covered by this scheme, but I repeat the assurance that the new subsidy arrangements will not affect the inshore and herring fleets. We announced on 15th May that the operating subsidies for the fleets which 981 are not subject to automatic reduction would continue to be reviewed annually in the light of their profitability. In the review the rates of subsidy were left unchanged.
The subject of the White Fish Authority was raised both for praise and for question. This is why we have introduced an allowance for levy increase in the Bill.
The hon. Member for Fife, East (Sir J. Gilmour) raised the question of research expenditure. This is one reason why we want to allow the White Fish Authority to raise more money in this way. The Authority has built up a substantial research and development programme the cost of which is at present shared about 50-50 between the Authority and the Treasury. It is clear that there is still a rôle for the White Fish Authority to play in this respect.
I am aware of the references that were made to the White Fish Authority in the report of the Fisheries Sub-Committee of the Select Committee. The Sub-Committee was completely concerned with the English and Welsh side, and suggested that there should be a further inquiry.
We are ready to consider any further proposal by the Select Committee. I do not want to prejudge such an inquiry but I am satisfied that the Authority has a useful function to perform. That function is shared, both in costs and research, by the Government. We sometimes forget how much additional money the Government put into research expenditure. In this case, it is about £1½ million a year. We have research stations at Torry and elsewhere. A fishery research vessel was launched this year and another is under construction—in a Scottish yard, I am pleased to say—for the Ministry of Agriculture.
Few of the questions raised in debate seem to have been related to the Bill and, as I tried to explain to Mr. Speaker, I am in some difficulty in answering them while trying to stick closely to the Bill. I agree that there is no mention of the minimum price scheme in the Bill but perhaps that is an accident of drafting. It has certainly been very much discussed today.
It will fall to my right hon. Friends to consider any scheme submitted by the 982 Authority and also any objections. It would be wrong for me to comment further now, but if the Authority wishes us to consider such a scheme, we will do so. However, it is worth remembering that it is not the unanimous view in the industry that such a scheme would be correct or viable. There is still opposition to it, and not only on the financial implication.
Then there is the question of frozen fillet import duties. I thought that this was raised with a little touch of sourness. My right hon. Friend makes a welcome announcement. We have been hammered on the subject for several months. The last time I spoke about fishing in this House I was hammered because I could not announce an import duty. I have been asked why it was announced in this way today in the House. It was because we wanted to tell the House and the nation the decision when it was taken and surely the House of Commons is the proper place for that.
I was also asked why it should have been made by my right hon. Friend the Minister of Agriculture, Fisheries and Food instead of by my right hon. Friend the President of the Board of Trade but, frankly, I do not think that that is a very important matter. The issue is, after all, of importance mainly to the fishing industry and it will surely have been brought more sharply to the attention of those concerned by the fact that it was announced by my right hon. Friend the Minister of Agriculture, Fisheries and Food.
I have been asked whether the 10 per cent. duty is to be on all fish or on frozen fillets or on imports in excess of 24,000 tons. The duty is to be on frozen fillets. In effect, we shall be going back to the position as it was before these fillets were bracketed with industrial imports in the original E.F.T.A. Agreement under Article 59.
§ Dame Irene Ward (Tynemouth)
There has been much detail about these frozen fillets. For the knowledge of the general public, can the hon. Gentleman tell us how much increase per fillet will accrue from the 10 per cent. import duty?
§ Mr. Buchan
Presumably it would be 10 per cent. of the retail cost, the price of the fillet would be arrived at by dividing by the number of fillets the total cost of selling these fillets.
§ Dame Irene Ward
But it must have been properly worked out to see whether it will really protect our fishing industry. I do not know whether it will protect it unless I know what the additional cost on the foreign individual frozen fillet is going to be.
§ Mr. Buchan
The price is, of course, 10 per cent. or 2s. in the £. Perhaps that helps the hon. Lady. The point here centres on the figure of 24,000 tons, and whether the landings from abroad go over that figure.
§ Mr. Buchan
It is not really a muddle. It is part of our relationship with E.F.T.A. and was fully discussed within the E.F.T.A. machinery.
It is difficult to predict the effect which the tariff will have in reducing imports. Naturally, the imports fluctuate from month to month and a large proportion are contracted for in advance. It will take some time before the effects of the new tariff are fully apparent and we shall keep the position under continuous review to see whether further action is needed.
Several hon. Members asked about longer-term measures to control unfair imports. We are very conscious of this whole general problem. As a trading nation, we do not move lightly into this kind of decision and we certainly did not do so in the case of frozen fillets. We must continually review this within the context of international trade.
Hon. Members have raised the case of the two Scottish skippers who were convicted of illegal fishing within the Isle of Man three mile fishery limit. The Isle of Man byelaw of 1965 prohibits fishing by vessels over 50 ft. within the three mile limit. There is little difference in principle between this byelaw and those we operate for waters off the Scottish coast. The Isle of Man authorities have not rigidly enforced the byelaw until recently but this does not mean that they were not entitled to do so. They gave ample warning that it would be enforced. I do not want to go into this matter more 984 deeply but I can give the welcome news that, despite the convictions, the two boats concerned have had a very successful season—in Isle of Man waters.
The question of trawler safety was an essential part of the debate. Hon. Members will have seen the decision announced by one large company, Associated Fisheries, to instruct skippers not to fish off the North of Iceland in the winter months. I understand that other companies are considering similar instructions.
§ Mr. Buchan
I need notice of that question, which raises an important point, and I will look into it. But this decision reflects the management's concern for the: safety of the crews. It has been taken as a result of the Court of Inquiry into the tragic loss of three trawlers last winter. My right hon. Friend the President of the Board of Trade has already announced that we accept the interim Report of the Court of Inquiry into trawler safety, in which it recommended that a weather advisory ship should be provided off the North of Iceland on an experimental basis. Arangements are in hand to carry out that recommendation.
In the circumstances, it will be necessary for my right hon. Friend to consider whether any change in the arrangements needs to be made and this he is doing urgently. It is not possible for me to say more now about these more recent developments, except that I will take note of the points put forward by the hon. Member for North Fylde (Mr. Clegg) and others about technical developments and their possible cost, and I shall ensure that these points are brought to the attention of the President of the Board of Trade.
I was asked whether the new scheme will enable older vessels to be more profitable. There will be no discrimination between classes of vessels but, of course, older vessels are in general less profitable. The more modern a boat and the better equipped it is, the better its landings and the higher its profits are likely to be compared with the older vessels.
985 The hon. Member for St. Ives (Mr. Nott) has apologised because he cannot remain for the rest of the debate, since he has another engagement, and I thank him for his courtesy in explaining that. As I have pointed out, this scheme does not mean that the inshore subsidy will be reduced. He asked why there was no mention in Clause 15 of Crustacea such as lobsters, crabs and crayfish. The short answer is that, for Crustacea, unlike molluscs, there is no known way of rearing them within the limits of an area suitable for an order of this kind.
We understand the concern of the Association of Sea Fisheries Committees about the effect of skin-diving for shellfish on their conservation, but it would not really help to try to apply to Crustacea these provisions which are appropriate only for oysters and other molluscs capable of being reared within a delimited area.
The hon. Gentleman was not so much concerned about holiday visitors but about professional skin divers. Sea Fishery Committee representatives concerned with the problem off the south and west coasts of England and Wales discussed the matter very fully with the Ministry of Agriculture, Fisheries and Food and undertook to think further about it in the light of that discussion. A suitable byelaw was one possibility which was mentioned, but I cannot take that thought any further tonight, for it will be for my right hon. Friend to consider any byelaw proposal on its merits and in the light of any objections.
We discussed this matter closely with the Sea Fishery Committee which works closely with the Ministry and I do not think that some of the implied suggestions of its not always working closely with us were altogether fair. However, I welcomed the close analysis by the hon. Member for St. Ives of its possible role. I do not think that we could accept his request to use the Bill as a means for getting a subsidy for processing plants. That would be a matter for the President of the Board of Trade and the paraphernalia of investment grants and so on which are under his control. We already have power to regulate the size of shellfish which may be landed.
I think that covers most of the questions. The hon. Member for North Angus and Mearns made one or two 986 points of theory, as did the hon. Member for Edinburgh, West, going so far as to suggest that if we pushed up food prices, we could solve the problem of fish prices. We ought to look at that kind of proposal with a great deal of care.
I was asked about the administrative cost of the Bill. The Departments have already examined this aspect and have considered profit and loss returns. They have to do this in respect of individual vessels anyway and under the present system they make many payments for individual vessels in the course of a year, so that a great deal of the work is already done and will be undertaken under the same umbrella. Nevertheless, I assure hon. Members that I look for some savings in administrative costs which will be an added contribution to the industry.
Mr. Deputy Speaker, you have been very patient with a speech which necessarily has had to go far beyond the remit enclosed by the Bill itself.
§ Mr. McNamara
I realise that the debate has been very wide-ranging, but my hon. Friend has not answered one specific question which I asked and which was about the Bill, although that may have been an oversight on my part. It arises from the recent Court of Inquiry and the report and the recommendation about the marking of life-saving equipment. I asked whether Clause 5 specifically covered that.
§ Mr. Buchan
I should like to have a look at that question.
I particularly welcome the fact that this is the first Bill to be brought before the House in this Session. That is not only a tribute to the fishermen, to whom tribute has been paid this evening, but a recognition of the importance the Government give to this industry. In general, the Bill has had a warm welcome. I am confident, as the Chairman of the British Trawler Federation seems confident, that it marks at any rate the possibility of a new era for our fishing industry so that it can play its full rôle in the national recovery which is now taking place.
§ Question put and agreed to.
§ Bill accordingly read a Second time.
§ Bill committed to a Committee of the whole House.—[Mr. Harper.]
§ Committee Tomorrow.