EGGS (GUARANTEED PRICES) (Hansard, 28 April 1969)

§ The Joint Parliamentary Secretary to the Ministry of Agriculture, Fisheries and Food (Mr. James Hoy)
I beg to move. That the Eggs (Guaranteed Prices) Order 1969 (S.I., 1969, No. 401), dated 17th March, 1969, a copy of which was laid before this House on 26th March, be approved. The purpose of the Order, which is otherwise a consolidating Order, is to give effect to three changes in the basis of the subsidy payments to the Egg Marketing Board. The first change is the introduction of a standard quantity. This follows on the Government's decision to put an end to the stamping of subsidised eggs. This decision was welcomed by hon. Members opposite as a useful step forward when we were debating the Eggs (Protection of Guarantees) Order, 1969, on 20th March.
Other things being equal, however, the removal of the stamp could be expected to lead to an increase in the number of eggs passing through the packing stations and thereby attracting subsidy. At the time when my right hon. Friend announced the decision to remove the stamp, therefore, he made it clear that it was our intention, in order to safeguard the interests of the Exchequer, to set a limit to the total number of eggs on which subsidy would be payable.
Paragraph 4(2) of the present Order therefore makes provision for the introduction of a standard quantity, and paragraph 8 provides for the scaling down of the unit rate of subsidy in proportion to any excess of throughput over the standard quantity. While eggs remain within the agricultural guarantee arrangements the amount of the standard quantity will fall to be determined by Ministers each year in the light of the conclusions reached at the Annual Review.
We announced in the 1969 Annual Review White Paper that the standard quantity for 1969–70 would be 651 million dozen. This is the same as the throughput of first quality eggs in 1967–68, which was the biggest throughput in any of the last three years.
The two other changes brought about by the present Order relate to the operation of the profit and loss sharing 1090 arrangements between the Exchequer and the Egg Board. Under the present guarantee system which was introduced in 1963 the basic rate of subsidy payable to the Egg Board is the difference between the guaranteed price and an indicator price representing the Government's estimate of the price which the board can expect to receive for its eggs over the year as a whole in a market which is adequately but not over-supplied.
A profit sharing arrangement comes into effect when the board's average selling price for the year is above the indicator price; the Exchequer receives two-thirds of the excess. The effect of paragraph 7(1) of the Order is to bring this arrangement to an end after 1969–70.
Side by side with this profit-sharing arrangement there is a loss-sharing arrangement which applies when the board's selling price for the year falls below the indicator price. A proportion of the shortfall is then made good by the Exchequer. This was designed from the beginning as an interim arrangement, and under the timetable originally fixed in 1963 it was due to be finally phased out after 1968–69.
In 1966 we extended this period by two years, and under this the Exchequer contribution in 1969–70 would have been 20 per cent., falling to 10 per cent. in 1970–71. We have decided to accelerate this timetable by one year so that the Exchequer contribution will fall to 10 per cent. in 1969–70. The broad effect of the Order, therefore, is that subject to the operation of the standard quantity the subsidy after this year will be put on to a flat rate basis, since the basic subsidy representing the difference between the guaranteed price and the indicator price will cease to be affected by profit or loss-sharing arrangements. At the same time the guaranteed price itself will no longer be subject to adjustment between Annual Reviews in the light of changes in feed costs since, as we announced in the 1969 Annual Review White Paper, the feed formula for eggs is being abolished from the beginning of the 1969–70 guarantee year. This was done administratively and did not involve any amendment of the Guarantee Payments Order.
The changes which are being made in the guarantee arrangements for eggs follows from the conclusions on future egg 1091 subsidy and marketing arrangements which the Government have reached in the light of their consideration of the Report of the Reorganisation Commission. The present Order, however, is a short-term Order since it is directly concerned only with the subsidy payments to the Egg Board.
The longer-term proposals which were outlined by my right hon. Friend in a comprehensive statement in the House on 22nd January provide for the payment of the subsidy after 31st March, 1971, to a new central organisation for eggs.

§ Mr. Speaker
Order. The hon. Gentleman must not go into the longterm proposals on this Order.

§ Mr. Hoy
No, I did not want to do so but in case the House was wondering how they would be affected, I thought this was the way to do it. However, if I am out of order in going into that I shall proceed to the next part.
These proposals are designed to facilitate the establishment of a free market for eggs, which we consider to be the right objective in the changed circumstances of the industry. The House will have the opportunity of considering our longer-term proposals as a whole when we come to introduce the necessary enabling legislation, which we intend to do as soon as possible. In the meantime we have asked the Egg Board to continue with its present functions until 31st March, 1971, and during this period the subsidy will continue to be paid to the board.
The present Order sets out the basis of the calculation of the subsidy payments to the board.

§ Mr. Peter Mills (Torrington)
I may as well say at the outset that it is difficult to debate the Order save in the wider context of the Government's proposals for the future of the egg industry.

§ Mr. Speaker
Order. I appreciate the fact that the hon. Gentleman is at the Front Bench. He must, however, debate the Order without debating the wider context. To do so is a temptation to every hon. Member.

§ Mr. Mills
I know it is, Mr. Speaker, but I thought that I should 1092 say at the outset how difficult it is to speak on an Order like this when there are serious policy decisions involved.
As we consider the Order we are beginning to get more and more unhappy about the Government's attitude to the egg industry. I shall seek to show the reasons for this. We are watching with keen interest the Government's proposals, none more than those contained in the Order. Much needs to be done in the industry after the reorganisation reports. The Government's present attitude needs some explaining. Just what are they playing at. We want to know. The industry wants to know. I believe that there is, even with the Order, a certain amount of confusion and alarm, to say the least.
The policy of the Conservatives on this issue is clear and definite. However, even with the Order there are some big question marks, and we need answers from the Government. We would hope to go to the Minister of Agriculture, Fisheries and Food for information yet on 31st January he said: The abandonment of guaranteed prices and the introduction of target prices"— which is what is happening here— could well turn out to be a move in the other direction towards greater uncertainty for farmers. Yet the title of the Order is Guaranteed prices and Assured Markets. So the Minister introduces an Order which is the exact opposite of what he said on 31st January. We should have some explanation of how he could have suddenly changed, because only a few weeks before the introduction of the Order he had said that the reduction of guarantees was wrong.
We have only to look at the briefs given to us by the National Farmers Union to show how concerned that organisation is at what is going on. I say again that even with the Order the industry is confused. There is a certain amount of distrust in the industry of the Government for bringing in an Order like this without certain safeguards.
The Order could have a serious effect on consumers. This is the most important aspect. It could certainly mean an increase in egg prices. That is very odd after all that the Government have said. The Order will bring about the start of the removal of the subsidy, which is 1093 bound to increase the price. Yet the consumer has nothing in return. Indeed, the Order without other measures could allow in further imported eggs to the detriment of the consumer.
The opening paragraph of the Order refers to the Minister of Agriculture, Fisheries and Food and the Secretaries of State responsible for agriculture in Scotland and Northern Ireland. The defects of the Order will be considerable in these remoter areas as the guaranteed prices are slowly removed. I wonder whether the Minister is concerned about the serious effect the Order could have and whether he has planned to cover the point. Make no mistake, this Order is the start of a guaranteed price running-down operation as the Government slowly withdraw these guarantees, and this will have a considerable effect on the remoter areas. They have problems of distance, and the social implications could be serious. This Order refers to "assured markets". Those words have a very hollow ring in an Order which withdraws the guaranteed prices without providing any other aid.
Article 3 of the Order says: This order shall apply to such … eggs … as conform to the standards and conditions specified by the Ministers … I only hope that the Minister requires a rising standard, for quality must be the key word in future egg production. The housewife will demand it, and we hope that with branded eggs the supermarkets will be able to sell on quality. I certainly support Article 3, and I hope that the standards will rise.
Article 4 refers to normal imports into the United Kingdom. I should have thought that we could do without those words in the Order, because I do not believe imports are needed. If we had proper import control, there would be no necessity for those words in the Order. Imports are usually heavily subsidised. How can there be an assured market without a minimum import price scheme? I do not see how this can be done, especially as the guaranteed prices are slowly to be withdrawn. It is, therefore, vital that the should be included.
As to the effect of this progressive reduction in guaranteed prices to the egg industry, in normal circumstances higher 1094 United Kingdom prices will attract a greater volume of imports, because we are still the only European country with an open general licence for eggs. The progressive reduction of this subsidy must therefore be tied to a system of effective import control.
If the Minister is withdrawing these guarantees, many other things ought to be done to help the industry, supported by a form of organisation which the Minister has mentioned. The Order does not tell us enough. Farmers will be left in a vacuum. The future of the egg industry depends on various other forms of help and advice and, indeed, co-operation.
The Order is the start of a phasing-out operation of guaranteed prices, including the abolition of the feed price formula and the phasing-out of the present profit and loss sharing arrangements. It also brings in a standard quantity for eggs, but it puts nothing in its place; there is no real transitional period of adjustment and advice. There are no minimum import prices; there is no Government participation in support buying. For this reason the industry is very concerned. Unless the Minister is prepared to adopt some of the measures which I have mentioned tonight, the industry will be in a very difficult position in the years that lie ahead.

§ Mr. R. J. Maxwell-Hyslop (Tiverton)
Naturally, I am concerned not only about what the Order says but about what is meant by the words used. One might almost be forgiven for thinking that it was about wool, so woolly is its phrasing. Article 4, guarantee prices and payments, is critical. I defy anyone to say what paragraph (1) (b) means, unless he be a psychiatrist looking into the Minister's mind— an indicator price, being an estimate by the Minister of the average price to be received by the Board on the sale of hen eggs or duck eggs, as the case may be, on the basis that production thereof is sufficient but not excessive having regard to the national demand therefor and, in the case of hen eggs, to normal imports into the United Kingdom during the year of hen eggs produced outside". The critical words there are "normal imports into the United Kingdom". What does that mean? Does it mean normal in relation to the previous year, to the previous two years, to the previous five years? Does it mean normal in relation to the balance between domestic 1095 supply and domestic demand? What on earth does "normal" mean?
Why does not the Minister put into the Order a specific term which means something definitive? It is the volume of imports which is critical to the effect of the Order upon the entire producing industry in this country. If the Minister says, "'Normal' means what I want it to mean when the moment comes to mean it"—which is what I fear he does intend—the Order presents the entire industry with utter uncertainty. It is sheer humbug to label the Order, "Guaranteed Prices and Assured Markets" when there is no definition of the market and no assurance that it will not be flooded by imports.
What "normally" happens, and what has been happening "normally" for many years, is that far more eggs have come into this country than we need. In a country which produces more than 99 per cent. of its own domestic fresh egg consumption, it is an act of folly as a matter of general policy to have any fresh eggs imported at all. When Ministers rush round Poland on jaunts, they are apt, just before they leave, to say that they hope, for instance, that Anglo-Polish trade will be increased as a result of their visit, despite the fact that most of what the Poles want to send us causes great embarrassment to our own industry and involves expenditure of foreign currency for something which we do not need.

§ Mr. Speaker
Order. The only Polish trade to which the hon. Gentleman may refer is in imported eggs.

§ Mr. Maxwell-Hyslop
Yes, Mr. Speaker. I shall pretend that we do not have to pay for the pork products which we receive from Poland, but undoubtedly we have to pay for the eggs. This is something which has acted against the Exchequer in the past under the loss-sharing arrangements and against agriculture itself in two ways, (a) by depressing its earnings, and (b) by depressing its creditworthiness.
Everyone knows that if egg production is to continue on a profitable basis in this country, it will require greater capital investment. That capital can be raised only on the basis of what the Order so 1096 dishonestly purports to provide; that is, the offer of an assured market. Therefore, the first thing I ask the Minister to define very clearly is what he considers "normal imports" to be.
I particularly ask the Minister to answer categorically the following question. If we are within 2 per cent. of producing as many shell eggs as we consume as a nation, does he agree with the proposition that normal imports should be zero? He surely cannot deny that it is well within the industry's capacity to produce every egg the country needs. I hope that he can tell us that the interpretation of the Minister of Agriculture, Fisheries and Food, and the Secretary of State for Scotland and the Home Secretary, whose Seals also appear on the Order—if by some freak there is agreement between three members of the Cabinet on this point—is that in such conditions "normal imports" mean no imports of fresh eggs. That would go some way to meeting the title of the Order, "Guaranteed Prices and Assured Markets". If he cannot give this undertaking, the title is grossly misleading, and, worse, the Order is grossly inadequate.
We are trying to get a balanced agriculture in this country, and eggs are still part of balanced agriculture. It is true that egg production is tending to become more and more specialised because of the economies of scale. Incidentally, in the same measure we are becoming very much more vulnerable to disease. We all know that vulnerability goes with increase in size. But until the Minister has defined the meaning of … sufficient but not excessive having regard to the national demand therefor and, in the case of hen eggs, to normal imports into the United Kingdom … nobody here really knows what we are debating.
The elasticity of prices is so great that if the Minister gets his interpretation of that wrong by 1 per cent. collapse of the market could result. We know this perfectly well from experience.
I turn to article 3, headed "Guarantee standards", which says: This order shall apply to such hen eggs and duck eggs respectively as conform to the standards and conditions specified by the Ministers from time to time in the light of their conclusions from a review held under section 2 of the Agriculture Act 1947. 1097 When was such a review last held, and when will the next be held? This is of some importance, because the Minister can apparently alter the standards and throw the whole industry into chaos at his own discretion without a fresh order. I would be greatly reassured to learn that I am wrong in that, but I read "from time to time" as the most unspecific timing possible. If the Minister will tell us how the phrase has been interpreted in the past, how often this has happened, that will at any rate give us a basis for extrapolation. If he will give us an undertaking that he will not alter the guarantee standards without first making a case to the House for it, that could also be a matter for considerable reassurance to us.
The Minister must realise that the industry, now left so desperately short of capital by a ludicrously inadequate Price Review, is suffering another hard blow—

§ Mr. Speaker
Order. I anticipated this. We are not debating the Price Review on this Order. The hon. Gentleman knows that.

§ Mr. Maxwell-Hyslop
Yes, Mr. Speaker, but eggs are one of the Price Review commodities and farm incomes are necessarily affected because many egg producers are farmers.

§ Mr. Speaker
Order. I assure the hon. Gentleman that Mr. Speaker understands the Price Review and that it includes eggs.

§ Mr. Maxwell-Hyslop
I am most concerned, without going into the Price Review aspects, about the effects the Order will have on farm incomes, so I ask the Minister to give specific answers on these matters of interpretation under Article 4(1)(b) and the history of the reclassification of the grading standards as provided for in Article 3.
Why do the Government think it necessary to include Article (3) in the Order? Is it because they have it in mind to alter the guaranteed standards in the near future? Or is this just a reserve power for the Minister which has not been used in the past which he wants to have up his sleeve? Or is he planning to do it at some finite period in the future? If he is going to alter the guarantee standards, it is necessary that the industry 1098 should have the maximum amount of prior warning.
There may be a good case—and I am not saying that there may not be—for exercising the powers under Article (3), but, if there is, the maximum amount of warning should be given to the producers and the hon. Gentleman should undertake to give the House publicly his explanation of why it is necessary to alter the standards. If he can give us the undertakings I have asked for under Articles 3 and 4, I shall be much happier to allow the Order to go through without a Division, but it is necessary to warn the Minister that he cannot take this for granted.

§ Dr. Reginald Bennett (Gosport and Fareham)
I cannot claim to be an expert on the marketing of eggs, as everyone else who has spoken in the debate seems to be, but my hon. Friend the Member for Tiverton (Mr. Maxwell-Hyslop) said that he found it difficult to comprehend the meaning of the Order and that he thought it required the intervention of a psychiatrist. Well, this is it.
I find myself even more confused about the Order than my hon. Friend can be because, if I am not mistaken about the symptoms I have observed so far, we have Socialist Ministers proclaiming with pride that they are bringing us to a free market in eggs and we have representations sent by the N.F.U., of which possibly minor fragments may have been heard in the speeches so far, which is strongly in favour of a further protection of the industry. This, to me, as a mere psychiatrist, seems to be so bizzare as to verge on the schizophrenic.

§ Mr. Speaker
Order. The hon. Gentleman must keep Freud out of it.

§ Dr. Bennett
I am "a-Freud" I was straying a little, Mr. Speaker. However, with even profounder respect for you after that, I shall go on to say that it is from my constituency that a number of eggs producers have come who brought about, to a large extent, the opening of the free market in unsubsidised eggs and, therefore, I have a constituency interest and am well disposed to see what can be done to assist the free market in eggs. I am not disposed to see the continuation of a completely protected market. I see the sense of at least one of the misgivings 1099 voiced today—that about the possible penetration of our market by imports. I therefore add my voice to those who ask for a good deal more enlightenment about what a normal extent of importing of eggs is likely to be.

§ Mr. W. H. K. Baker (Banff)
The Explanatory Note to the Order says: This order, which comes into operation on 30th March 1969 …". Unless I am mistaken, that is 29 days ago. In other words, the Order is operative even before we discuss it. If for any reason we vote against the Order and it is thrown out, what would be the position if the Order has been in operation for 29 days?
It refers specifically to Scotland. The opening lines say: The Minister of Agriculture, Fisheries and Food and the Secretaries of State respectively concerned with agriculture in Scotland and Northern Ireland …". What does the Minister expect the effect of the Order to be on the egg-producing industry in Scotland? He said that for 1969–70 the standard quantity for egg production, which I took to be for the whole of the United Kingdom and not just for England and Wales, was to be 651 million dozen eggs per annum. What proportion is expected to be produced in Scotland? I have to tell him, if he does not know it, that, because of the antics of his Ministry consequent on and before the Minister's statement of 22nd January, confidence has been undermined throughout agriculture, not least in the egg producing areas.

§ Mr. Speaker
Order. The only antics of the Minister in which we are now interested are those in this Order which is concerned with the guaranteed price of eggs.

§ Mr. Baker
Confidence in agriculture has been undermined by various Government pronouncements, so much that the level of production, particularly in Scotland, is liable to be lowered. I should like the Minister to say what proportion of the standard quantity is expected from Scotland. Can he honestly say that the amount expected will be realised?
The Minister mentioned the Exchequer contribution in the profit and loss sharing arrangement for 1969–70 being reduced by 1100 10 per cent. If further pronouncements are taken into account, that means that the profit and loss sharing arrangement will completely end. I was not clear from what the hon. Gentleman said whether that is to be the case, and perhaps he will tell us more about that.
The abolition of the feed formula has contributed to the loss of confidence in egg producing areas. In the short term, if subsidy payments are to be withdrawn from the Egg Board, farmers in the remoter areas are bound to be influenced, because they are not convinced by anything the Government have said, or by anything in the Order, that the industry can continue without these subsidy arrangements.
I refer particularly to my part of the world, which is extremely remote. The normal level of imports is a most important part of the Order. It is mentioned in Article 4(1)(b) and a few lines below. We are about 97½ per cent. self-sufficient in egg production, and if that 2½ per cent. is made up sensibly, obviously imports will be allowed in during a time of poor production. No one would quarrel with that, if we were to keep it at that level, at that time. What I fear is that with the abolition of the Egg Board, consequent upon this Order and the Minister's announcement, the level of imports will increase.
This will further add to the detriment of the egg industry in the more remote parts of the country. In my part of the country, egg production has been the pin money for the farmer's wife. This Order, and other actions that the Government have taken, and are taking, means that the loss of this small amount of money, not a great amount which would have a vast effect on the economy of any one farm, will create genuine hardship in a large number of cases to farmers' wives in these areas.
Article 4(2) says: In respect of each year … a standard quantity shall be determined for hen eggs. If it is to be determined for hen eggs, why not for duck eggs as well? Is the Minister convinced that it is necessary for duck eggs? Perhaps he would explain this.

§ Mr. Speaker
Order. The hon. Gentleman knows that he cannot amend the Order. Mr. Baker.

§ Mr. Baker
I have sat down.

§ Mr. Michael Jopling (Westmorland)
The Minister said that he expected the British Egg Marketing Board, which has done a very good job in general over the years, to continue until 1971. With the background of the policy which the Government have laid down, of which this Order is only a part, does he not feel that there is a danger that this will change the atmosphere of egg marketing? The authority of the Board is likely to fall away severely in those small areas dealt with in the Order, because everyone will know that it is to wind up, and its authority will be reduced.
It is important that the Minister should tell us what the effect of the Order will be on a number of things. What effect on producers will the phasing-out of the guarantees have? Is there not a great danger that it will hit the small producers very hard? What has he to say about that? What effect does he think the introduction of standard quantities of eggs will have on the incomes of egg producers, particularly the small egg producers?
To repeat the question which was asked by my hon. Friend the Member for Torrington (Mr. Peter Mills), what effect will the Order have on egg prices charged to housewives in the shops. The Government are making great play in another context about the effect on food prices on housewives. We must know what will be the effect of this Order on prices in the shops.

§ Mr. Paul Hawkins (Norfolk, South-West)
They do not know.

§ Mr. Jopling
My hon. Friend says they do not know, but I cannot believe that they would come twice to the House not knowing the answer, as, of course, they did last week over the National Insurance contribution.
I must come to the point which has been made by a number of my hon. Friends about import control. The Government in the past have said that part of their strategy on eggs, a strategy of which this Order is part, is to control imports through minimum import prices. Paragraph 4 of the Order says that the indicator price can be altered if the level of imports has altered.
1102 We must know why the Government have thought fit to bring in this Order which does so much without at the same time completing their strategy. The Government originally announced their policy in one statement. But here we have the strategy coming out in bits and pieces, in dribs and drabs. What is the reason? The Minister must explain it to us when he comes to reply.
I wish to ask two more detailed questions. One is in regard to paragraph 9. where one sees … the Minister may make available by way of advance to the Board such sums as he may from time to time think fit. May we be told what that means, and whether the Minister has in mind some very great change about which he has not told us? What ceiling is there on these sums of money which the Minister may make available to the Board? Parliament should not pass these Orders without a clear explanation from the Minister. I did not hear in the Minister's opening speech, unless I was not listening at the time, any reference to this particular matter.
My last point is to ask the Government exactly what is their strategy over these guarantees. The new pattern which the Government are evolving appears to be that when any one form of production becomes self-sufficient, such as eggs in this Order, we are presented with this type of policy and have to debate Orders in which the whole guarantee structure is thrown out of the window. There are those in the House who think that there are good reasons for changing the system of support and guarantees. But if we are to have that change without the guarantee of import control, with which this Order does not deal at all, the Order is a dangerous weapon indeed, and is something which must be questioned most carefully.

§ Mr. Patrick Wolrige-Gordon (Aberdeenshire, East)
I am not happy about the Order, and for very much the same reasons which have already been adduced by a number of my hon. Friends in the debate, particularly in their concern about the effect which it may have in the way of hardship for producers, particularly the small producers, and especially the producers in remote parts of the country, like North Scotland, who do not have 1103 any assistance. There is a danger of hardship to producers in the Order, and they, too, will be as sceptical of its Title when it refers to an assured market as was my hon. Friend the Member for Torrington (Mr. Peter Mills) in so ably opening the debate from the Front Bench on this side of the House.
Obviously, imports are the vital question. So far as I am aware, we have produced 97 to 98 per cent. of our eggs for a considerable number of years, and from the technical point of view there is obviously no reason why we should not produce 100 per cent. at any time. It is certainly within the capacity of our industry to produce 100 per cent. of our eggs at any time. There is no indication in the Order that the settlement of the question of imports will satisfy our egg producers.
In Article 4(2) the Order states that In respect of each year a standard quantity shall be determined for hen eggs. Standard quantities have not had a very happy history in our agricultural experiences over the last few years. No Government can be asked to produce more of a standard quantity than 100 per cent. of the market, but I hope that we shall have that assurance at least as a result of the Order.

§ Mr. R. H. Turton (Thirsk and Malton)
In listening to the Joint Parliamentary Secretary, I found it hard to see how the Order fitted into the expansion programme announced by the Minister in November. As I see it, it all depends on Article 4 and, as my hon. Friend the Member for Tiverton (Mr. Maxwell-Hyslop) has said, normal imports. At the moment, the industry saves something like £176 million in imports. I hoped that it would save more under Government policy, but it appears from Article 4 that the result will be very different.
My first question, therefore, to the Joint Parliamentary Secretary is to ask why he used the phrase "normal imports" rather than "estimate of imports". The Minister must know what he expects the imports to be in any year as a result of any policy that he may pursue within or without the Order. Here, however, he has tied himself to 1104 normal imports, presumably the imports of the last two years.
The position becomes even more difficult because the Minister then makes the proviso that if the normal imports are more than he expects he will lower the indicator price. What will happen if the normal imports are less than he expects? Will he then raise the indicator price? The Order appears to make no provision for that. Surely it should. Therefore, the Order is incomplete.
My last point is less important, but it concerns something which is not clear from the Order. Article 3 provides that This order shall apply to such hen eggs and duck eggs respectively as conform to the standards and conditions specified by the Ministers". Does that apply merely to eggs which are home produced, or does it also apply to hen eggs produced elsewhere? If it applies to hen eggs produced outside this country, clearly the normal imports are of little value, because Polish eggs will not conform to the specification for guarantee standards. It should be made clear in the Order that Article 3 applies merely to hen eggs produced in this country and not to hen eggs produced elsewhere. I ask the Minister to consider this.
You said earlier, Mr. Speaker, that it is not in our power to amend the Order. That is unfortunate, because it is so badly drafted that we should like to amend it.

§ Mr. Alick Buchanan-Smith (North Angus and Mearns)
I should like to follow my right hon. Friend the Member for Thirsk and Malton (Mr. Turton) in saying that I also cannot see how this Order fits the context of the statement made by the Minister of Agriculture, Fisheries and Food last November about the expansion of agriculture. If we are to have expansion we must have confidence, and, as far as I can see, this Order will not engender confidence in the poultry industry.
I would reinforce strongly what my hon. Friend the Member for Torrington (Mr. Peter Mills) said, that it is absolute folly to introduce an Order like this without assurances about the minimum import prices of eggs. That causes great concern in the industry, which is also 1105 wondering what the attitude of the Government is towards marketing boards in general. People are wondering if this is the beginning of an attack on producers' marketing boards in general.
I refer specifically, as did my hon. Friend the Member for Tiverton (Mr. Maxwell-Hyslop), to paragraph 4 and what constitutes "a normal level of imports". My hon. Friend the Member for Banff (Mr. W. H. K. Baker) mentioned that 2½ per cent. of shell eggs consumed in this country are imported. That, by itself, does not seem in absolute terms a desperately large quantity. I am not concerned about that normal level in terms of absolute quantity if it is phased over a year; but in recent years we have often seen imports concentrated in a very short period of weeks, knocking the bottom out of the egg market for our producers, which is a "normal level of imports" I for one am certainly not prepared to accept. I may accept 2½ per cent. if it is phased reasonably over the year as a whole. I certainly do not accept that as a normal level if it means imports are to be concentrated in a short time, knocking the feet from under our producers in this country.
Without wanting to go into it in detail now, I would like also to follow what my hon. Friends have said about what will be the effect of this Order on producers in the remoter areas. The North-East of Scotland has been mentioned in particular, where we have many egg producers. I am extremely anxious to know what the effect of this Order will be on them. They are anxious, and I should like the Minister to do something tonight to allay some of the very genuine anxiety which is felt in my part of Scotland. In particular, I would like to know what he proposes to do to relieve the anxiety of those producers concerned with co-operative marketing, because producers in the remote areas have until now had the full protection of the guaranteed price, and I am very anxious to know what the future holds for them.

§ Mr. Paul Hawkins (Norfolk, South-West)
I wish to follow what my hon. Friend the Member for North Angus and Mearns (Mr. Buchanan-Smith) has said about the lack of confidence which this Order will engender in the industry, but 1106 first I should like to raise two minor questions.
The Order starts by saying The Minister of Agriculture, Fisheries and Food and the Secretaries of State respectively concerned with agriculture in Scotland and Northern Ireland and it is signed by the Minister of Agriculture, the Secretary of State for Scotland, the Home Secretary and other people. I do not know whether this Order applies to Wales, because I understand Wales has a Secretary of State. If it does not, perhaps the Minister could give some reason why it does not.
Secondly, I wonder why duck eggs are still covered by the guarantee. I do not think there are many imported duck eggs, and I would have thought that probably they did not need to be covered by the guarantee.
My main point is that the uncertainty of so many Articles will result in a lack of confidence among egg producers. Article 3 states: This order shall apply to such hen eggs and duck eggs respectively as conform to the standards and conditions specified by the Ministers from time to time … If standards are to be laid down for duck eggs and hen eggs we should be told what those standards are. Will the normal imports of Polish and other eggs also conform to the standards and conditions? How will the Minister discover the conditions and standards to which imported eggs will conform? The Order should set out the standards and conditions which are to be specified by the Minister.
Article 4 refers to "normal imports". If the industry does not know what is in the Minister's mind about "normal imports" it will not be able to govern its production so as to meet the "normal imports". Will "normal imports" be the average over the last three years, or how are they to be determined? This great industry produces practically all the eggs that are needed and could easily produce the lot, and I see no reason why any eggs should be imported.
Article 5 also creates uncertainty in the minds of egg producers. It states: After 28th March, 1970, an average selling price of hen eggs and duck eggs respectively for the year ending on that day shall be ascertained by the Minister in accordance with arrangements agreed with the Board or in default of agreement in accordance with such principles as the Minister shall decide. 1107 Supposing that the Board and the Minister disagree, what are the principles which will apply? If there were to be no imports, or levies where imposed on imports, and if this were set out in the Article, egg producers could work out how many eggs would be needed for the home market.
To sum up, Article 3 does not set out the standards and conditions which will be specified. Article 4 refers to any increase above a normal level of imports, but does not define what is the normal level. Article 5 provides that the Minister is to decide certain principles in default of agreement with the Board, but we are not told what these principles are. The Order is so had that we should reject it and ask the Minister to bring forward another one.

§ Mr. Bryant Godman Irvine (Rye)
One of the difficulties about debates taking place at this time of night is the difficulty that hon. Members have in keeping within the rules of order, but looking at the heading of this Statutory Instrument I wonder whether it is not an example of the reverse of that coin. The Order is headed "Guaranteed Prices and Assured Markets". Addressing myself to the problem of finding any reference in the Order to assured markets, I find myself in some difficulty. We have "Interpretation", "Guarantee standards", "Guarantee prices and payments", "Keeping of records", and "Revocation".
Whether the Minister has left half the Order behind, or whether the heading about assured markets should be on some other Order, which we shall debate on another night, I do not know. If the Minister will look at the Explanatory Note he will see that that does not contain anything about assured markets. Perhaps, with your assistancse, Mr. Speaker, he will be able to explain how the heading "Assured markets" covers anything in the Order.
My second point is that this is an Order which cannot give confidence to anybody who produces eggs. Those with a little experience of Statutory Instruments would find this Order as difficult to interpret as most. Article 4 refers to an indicator price and the normal level 1108 of imports, but sub-paragraph (1) (b) defines the indicator price as on the basis that production thereof is sufficient but not excessive having regard to the national demand therefor and it goes on to provide that a reduction shall be made which is appropriate having regard to any increase above a normal level of imports into the United Kingdom. I do not think that the average egg producer will make much of that.
If the Minister will turn to Article 7 he will find that the position becomes even more complicated, for it says: If … the average selling price … if higher than the indicator price … the Board shall pay to the Minister two thirds of the difference and a little further on, If … the indicator price … is higher than the average selling price … the Minister may pay to the Board one tenth of the difference". That seems to be a difficult calculation for the egg producer.
Article 8 provides that in any year when the number of eggs packed exceeds the standard quantity any reference in articles 6 and 7 hereof to the difference between the guaranteed price and the indicator price and the difference between the average selling price and the indicator price respectively shall in each case, in so far as each of the said provisions relates to hen eggs, be taken to be a reference to the respective difference divided by the proportion which the number of hen eggs packed in that year bears to the standard quantity. A person would have to be a good mathematician to work that out without the assistance of the Minister, which I hope we can have in a moment.
Why have these arrangments to be related only to packing stations? We have been told that the producer-retailers will probably find themselves considerably reduced in numbers as a consequence of the Order, and it may be that some of them will consider setting up a co-operative packing station to get themselves within the scope of the Order. If that is the case it will, I am told, add about 2d. per dozen to the cost of the eggs which will then be made available. I therefore hope that the Minister will tell us whether what he is trying to do in this Order—among other things—is to see that there is an integration of the egg industry and a reduction in the number of producer-retailers.

§ Sir Harmar Nicholls (Peterborough)
May I draw your attention, Mr. Speaker, to the fact that, despite the importance of this debate, there is not a quorum present?

§ Mr. Speaker
Strangers withdraw—Order. I am reminded that there can be no count after Ten o'clock.

§ Mr. Anthony Stodart (Edinburgh, West)
We have had a debate which, although on a subject which no one would describe as sensational, had at least one sensational statement in it. I do not know, Mr. Speaker, if you have ever heard—I certainly have not—a member of the psychiatric profession confess that he was confused by anything. It is indeed a condemnation of the Government that they have produced an Order which confused my hon. Friend the Member for Gosport and Fareham (Dr. Bennett).

§ Mr. Hoy
I think the hon. Member for Edinburgh, West (Mr. Stodart) will agree that his hon. Friend said he got into that condition only after listening to the speech of his hon. Friend the Member for Tiverton (Mr. Maxwell-Hylsop).

§ Mr. Stodart
I do not think my hon. Friend the Member for Gosport and Fareham said that. My impression was that he made the comment—and a very balanced one it was—having studied the Order and found it extremely difficult to understand.
The three points which have been made by my hon. Friends have been: that they are worried about the confidence which might be shaken concerning egg producers, they have rightly questioned the meaning of the words "normal imports"—

§ Sir Harmar Nicholls
Is there not an addendum to that point? The Order lays down clearly that it shall refer to shell eggs. Article 4 talks about normal imports and makes no reference to the possibility of processed eggs being imported. The hon. Gentleman who is to reply for the Government knows that one of the great problems his Department has is that many processed eggs come into the country in competition with the home market.

§ Mr. Stodart
That is just the sort of telling point I would have expected my hon. Friend to make.
1110 The third point I was about to mention was the question of difficulties which will come upon egg producers who are further away from markets because they are bound to suffer first from any withdrawal or diminution in Government guarantee.
Whatever may be said about the Order, it will not help egg producers. My hon. Friend the Member for Westmorland (Mr. Jopling) put the point very well when he referred to small producers in all parts of the country. No confidence can be inspired in the minds of egg producers when the Government decide to opt out of their part in the loss-sharing arrangements which have obtained hitherto. My hon. Friend the Member for North Angus and Mearns (Mr. Buchanan-Smith) made the kind of speech we expect him to make with his tremendous wealth of knowledge gained on the Select Committee with all the very valuable delving it made into many aspects of the industry. What the Government are doing in this Order is quite inevitably going to produce uncertainty, which is very damaging to food production of all kinds.
I turn to the question which was raised first by my hon. Friend the Member for Tiverton, the unusual word "normal" in reference to imports. There need be no imports at all. It was the argument of the Government a year ago that the imports were so small that they were virtually negligible. I suspect that the Minister might say that normal imports are something like 2 per cent. or 3 per cent. A 2 per cent. import at the wrong time can completely wreck the market. We have had many unhappy experiences of this.
I would like the Parliamentary Secretary to tell us, because clearly the House is interested, what his interpretation of "normal" is. Why has this word been used? Is it possible for this normal lot of imports to come into the country in one whole dollop at one extremely awkward time for home producers? It is a most unusual—I would almost say an extraordinary—description to put into an Order.
My right hon. Friend the Member for Thirsk and Malton (Mr. Turton) asked why the Order refers only to a fall in the indicator price and makes no reference to a possible increase. This is a 1111 one-sided Order and a one-sided approach. If the effect of uncertainty is to reduce home production, as I should have thought it almost certainly would, and if imports increase, as is only too likely, once there is an increased level of imports it will be only too easy to claim this as the yardstick and for this to become the normal feature of the egg trade. That is why I think that the Government are taking producers on to a very slippery slope.
As my hon. Friends have argued, producers who are further away from the markets are inevitably the people who will suffer first and suffer most. I recognise that there will be further legislation in due course, in which no doubt we shall hear more about the subvention which is being negotiated, I understand, with regard to egg producers from the other side of the Irish Channel and of the Pentland Firth. All the same, I hope that the Parliamentary Secretary will be able to tell us what the effect will be upon those in the sort of constituency represented by my hon. Friend the Member for Banff (Mr. W. H. K. Baker), which is on the mainland pretty far from the egg markets and where the producers, by a reduction in the standard quantities and by the other action that the Government propose to take in the Order, will suffer before any hardship will be caused to those who are much nearer the sectors of consumption.
These are relevant and important points. Whether the Government have thought about them remains to be seen. It is most important that the hon. Gentleman should tell us all that he can about these plans.

§ Mr. Hoy
I am grateful to all those who have spoken. I am glad that the rules of order allowed us to finish the debate and that we did not need a Count to bring it to a halt.

§ Sir Harmar Nicholls
On a point of order. Is the hon. Gentleman admitting that there are not enough Government supporters in the House to get the Order through?

§ Mr. Hoy
I regret having given way to the hon. Gentleman on as foolish a point as that. Most of us who are here tonight have a real interest in agriculture. 1112 I knew that I should be in some difficulty with the Order, not because it is not complete, but because action took place prior to the Order and we shall have something to do after the Order is approved tonight. Therefore, it has been taken in three sections, and I do not think there should be any complaint about that because for each section we have been allowed an hour and a half. If we had done as some hon. Members requested, and had pushed it all into one, we would have had to deal with the whole lot in an hour and a half. The procedure which we have followed has enabled the House to discuss it with much more time.
When we introduced the Order we were concerned with the removal of the stamp because the whole industry wanted the stamp removed. The industry wanted this done quickly, and this is why it was done at Christmas time. So we went ahead and produced an Order which met the needs of the industry, and that completed that section.
The hon. Member for Rye (Mr. Bryant Godman Irvine) asked what we are doing in the Order tonight. Let me explain to him as succinctly as possible. In the Order which we are debating tonight we have a statutory provision for short-term changes in the guarantee arrangements within the present marketing arrangements. It also protects the taxpayer from any increase in subsidy following the removal of the stamp. The hon. Member for Torrington (Mr. Peter Mills) will remember that in the last debate he asked me how we proposed to do this, and I told him that it would be dealt with in the Order which was to follow. Therefore, we are doing what we promised and what I assumed would be acceptable to the hon. Gentleman. In addition, the Order accelerates the phasing out of loss-sharing, and details the changes which were announced in the Annual Review.
I said that there would have to be an Order following on the two previous Orders—I believe the hon. Member for Edinburgh, West (Mr. Stodart) agreed that I had said so—and therefore, the longer-term measures concerned with major changes in the marketing arrangements—the new authority, the removal of the guarantee and so on—will come 1113 within the next Order. When I introduced the Order I said that this would take a little more time because obviously we have got to consult the industry. This will take time, but the next Order will make provision for many of the matters which have been raised by hon. Members.
Let me now deal with the general points. A number of hon. Members—I am surprised that the father of the House fell by the wayside in this respect—drew attention to the wording of the Order and said that they could not understand it. They criticised what they referred to as the defective wording. May I remind hon. Members that this is a consolidating Order which merely repeats word for word the provisions introduced by hon. Members opposite.

§ Mr. Hawkins
rose—

§ Mr. Hoy
I will come to the hon. Gentleman's point in a moment.
The Order of 1963, in Articles 3, 4(1), 5, 6 and 9, contained words for which hon. Members opposite were responsible. I cannot claim responsibility for the wording. Indeed, I do not take exception to it. I think those measures worked admirably. As a result we are doing this consolidation.
I take, first, Article 4(6). The hon. Member for Tiverton (Mr. Maxwell-Hyslop) made a lot of noise about this, and I do not mind because one can always have a little fun when Orders are introduced. But the wording of Article 4(6) was first introduced by hon. Members opposite in 1963. I am surprised that there has been so much comment about it.

§ Mr. Stodart
The hon. Gentleman has twice referred us to Article 4(6). I am baffled. There is no paragraph (6).

§ Mr. Hoy
I apologise. It was a slip, and I meant 4(b). Hon. Members have asked what "normal" means. It is based on past experience. It is the actual figures. Normal imports in this respect are as laid down in 1963. It is based on past experience, as I say, and we have not changed the criterion introduced by hon. Members opposite. We merely repeat that criterion, and the import percentage about which there has been so much talk was laid down then at 2½ per cent.
1114 I was asked also about Article 3 and what was meant by the review. It is the review as laid down, the Annual Review, and it has always been so since the original Order of 1963. I cannot think that hon. Members have any real objection to the Order at all, or, if they have, the criticism ought to be directed not to us but to the wording of their own Orders.
The hon. Member for Banff (Mr. W. H. K. Baker) wanted to know about the procedure and timetable following this debate. I assure him that we are following the standard practice. There has been no departure there. He wanted to know also what the Scottish share was. The figures which he gave were correct, as were those which I gave when introducing the Order. I understand that Scotland produces about 10 per cent. of total egg production, but not all of these are sold to the Board, thus counting against the standard quantity. He asked also whether the profit and loss sharing arrangement ends this year. It is 1970–71.
As to the need for standard quantities for duck eggs, the simple answer is that the subsidy has been running at only about £200 per annum for this part of egg production. Hon. Members can see the reason there.
The hon. Member for Westmorland (Mr. Jopling) stressed that the position of the Egg Board is important. I do not deny that, but, as I said, it has nothing to do with the Order. That will come at a later stage.
The hon. Member for Tiverton spoke of the small producer. This is an extremely important aspect of the matter, but the number of small producers in this country has been declining substantially, not in the last four or five years but over a period. The number of producers registered with the Board fell from 396,000 to 194,000 between 1957 and 1968. The hon. Gentleman knows as well as the rest of us do that the tendency is for much bigger units. This is one of the facts of life which we have to face. I would have thought that most hon. Members would agree that that is so.
I was also asked about the meaning of Article 9. I am told that this is the standard form of previous Orders, and 1115 enables Ministers to maintain board income by making advance payments of subsidy. This standard form has been used by all Governments for this purpose.
The question of import control was raised. This could be introduced, but not under the Order; it would need to be under a separate Act.
The hon. Member for Torrington asked about minimum import prices, and the hon. Member for Tiverton also mentioned this question. Of course, we are considering minimum import prices. As has been said, we usually produce 98½ per cent. of our own egg requirements, but I know that at certain times of the year it is important that phasing should be taken into account, and this is what we have been trying to do. We must obviously discuss with the industry the question of when such a measure should be introduced. If we are to make it successful it is essential that we discuss it with the industry before the next Order is laid.
The question of market support in the long term was also raised. When the Egg Commission made its first report it wanted the change done in a much shorter period than we have laid down. It recommended a three-year period, and we extended this to five, because we thought it essential to allow a longer period so that the industry could make the arrangements necessary following the changes flowing from the decisions that have been made.

§ Dr. Bennett
Why was the period shortened again?

§ Mr. Hoy
It has not been. Eggs will continue in the Review right up till that date. It is true that the support will be phased out. By the date I have given the market will be absolutely free.
I was interested in the hon. Gentleman's point, which I thought very important. I understood that what was being done was meeting the wishes of the industry—