AGRICULTURE (BACON CURING INDUSTRY) (Hansard, 27 June 1969)

§ The Joint Parliamentary Secretary to the Ministry of Agriculture, Fisheries and Food (Mr. James Hoy)
I beg to move, That the Bacon Curing Industry Stabilisation (Variation) Scheme 1969, a draft of which was laid before this House on 11th June, be approved. 1931 The purpose of this scheme is to extend for a further six months the existing scheme which the House approved in March this year. At that time the Government announced that the Industrial Reorganisation Corporation would examine the industry and study the effects on its performance of the present stabilisation arrangements or of possible alternative forms of support. It would, clearly, not be prudent to make decisions about any longer-term arrangements till the Corporation has finished its work. Nevertheless, to make a start with a scheme covering six months only meant that any recommendation of the Corporation which the Government accepted could be implemented with the least possible delay. The Corporation's work is being carried out as quickly as possible, but it is not yet complete, and so we must provide for the period after 30th September. My hon. Friend the Joint Parliamentary Secretary, when he introduced the original scheme in March, said that should it be necessary, the Government would propose to lay before Parliament a scheme extending the existing arrangements for a further short period sufficient to cover the Corporation's final recommendations."—[OFFICTKL REPORT, 24th March, 1969; Vol. 780. c. 1186.] This scheme is now before the House.
Obviously, it is essential that the I.R.C. should do its work not only as quickly as possible but as thoroughly as is necessary. When the Corporation has taken its work as far as it can and made its recommendations on the effect of the support arrangements the Government will have to give careful consideration to any longer-term arrangements in the light of the then situation and the Corporation's recommendations. We hope that it will be possible to include such arrangements, if they were considered necessary, in a scheme operating from 1st April, 1970. Of course, it will be possible to consider any interim recommendation from the Corporation earlier than this in so far as it can be implemented within the existing scheme.
As hon. Members will be aware, the scheme at present requires the payment of levies by bacon curers because of a rise of 50s. in the price of British bacon. The self-balancing nature of the scheme, to which the House's attention was drawn 1932 during the debate on the original scheme, has become, for a time at least, a reality. How long a levy will continue to be paid depends, of course, on how long the bacon price remains at the present level.
The variation scheme at present before the House is an extremely simple one and merely extends the operation of the present scheme to bacon produced up to 31st March, 1970. No other change is being made. The Government will, of course, be seeking the necessary financial provision for the making of stabilisation payments in the second half of the present financial year.
I think all hon. Members will agree that it is sensible to continue the stabilisation arrangements and that the possibilities for a more permanent scheme should await the outcome of the present investigations. I therefore commend this variation scheme to the House.

§ Mr. Bryant Godman Irvine (Rye)
I welcome this scheme, but the first criticism I would like the Minister to consider is that this is the second time we have had a go at this scheme in three months. He will, perhaps, have noticed that when we discussed the matter on 24th March I drew the attention of his colleague to the fact that the scheme would be running out on 30th September and that that would probably mean we would have to consider it after a short time. He seemed to take another view, and that there was a possibility we could consider it even later, that it could be reviewed before 30th September and debated after that, but the fact is that here we are again discussing the Bacon Curing Industry Stabilisation Scheme only three months after it was discussed before.
At least this gives us a little longer period in which to plan than was the position when we were last discussing the matter on 24th March, because we now know what the position will be up to 30th March, and that being so there is a period of about nine months. I would ask the Minister how he thinks anybody breeding pigs or producing bacon can, in a period of nine months, plan his business and see how he can organise things on a stable basis. The first point I would leave with the Minister 1933 is that it is impossible for this industry, which is an important part of the agricultural industry, to be organised on the basis of three months or six months at a time.
The right hon. Gentleman referred to remarks which were made by the other Joint Parliamentary Secretary when we last discussed the scheme, and referred to the remark that he would be prepared to act on an interim recommendation from the I.R.C. I did not detect anything in what the right hon. Gentleman said today about the possibility of an interim recommendation. He will recall that his colleague said: I know that a decision on a longer-term basis is urgently required, however, and the industry is naturally anxious to see the road ahead as clearly and as soon as possible."—[OFFICIAL REPORT, 24th March 1969; Vol. 780, c. 1186.] That is what the industry needs—to see the road ahead very clearly, and that is what it has not been enabled to do under the management of this Government.
The right hon. Gentleman will recall that when the original scheme was brought forward in April, 1967, there was a promise then by his colleague of an annual review of the position. What has happened to that? I asked that question when we discussed the scheme in March, and got no answer at all. The reason why it was important to have an annual review was that there were very serious complaints about the basis on which the scheme was originally calculated. The Minister will recall that in 1967 the figures on which the scheme was based were those of 1965, and although it was agreed on all sides that they were to be regarded only as temporary, that they were figures which had been worked out quickly to help the scheme go into action, they were described, by at least one member of the industry, as being "as mean as possible". That being the position, the Minister must bear in mind that it is not unreasonable to inquire why it is that we have not had the review and when it is that we shall have the review.
The other aspect of the matter is the fact, as the Minister has mentioned, that prices are now high. Some people feel that they are too high, that if they had been restrained at a slightly lower level we would have a better chance of seeing whether we could take over a larger 1934 proportion of the home market. Although prices are high, however, as recently as 20th June there was an article in the Financial Times which ended: As far as the U.K. is concerned the latest census figures indicate that the past two years' expansion in the home breeding herd has come to a halt. It goes on: So it looks as if there are no real grounds at the moment for thinking United Kingdom curers will win customers away from imported and on to home cured bacon—indeed the trend by the end of the year could well be going the other way within the limits set by the bacon market understanding". That refers to the reasons why prices have gone up. Three reasons which are affecting the present price of bacon are related to internal matters in Denmark, and I apprehend that that woud not fall within the terms of the scheme.
All I can do is to give the Minister credit for the other factor, that there is a shortage of pigs available to the curers. If the Minister wants to take credit for that, he is welcome to do so. Although the prices are high, the industry has grave anxiety and needs a clear indication of what is to happen.
This section of the agricultural industry accounts for a large proportion of food imports. The right hon. Gentleman could have shown his determination that agriculture should save imports by encouraging the bacon producer. If the bacon producer is to take over 51 per cent. of the market, as is hoped, it is essential that he should in the near future be able to make long-term arrangements for breeding and for contracts.
The picture painted by the right hon. Gentleman shows that during the last two years there has been a sorry story of indecision, that the pledge given in April, 1967, about the review has not been kept and that there is still no clear indication of the way ahead for this section of the industry.
I hope that when we meet again to discuss these schemes and what is to happen about the bacon curing industry, the right hon. Gentleman will take the opportunity of giving the industry a clear signal that the time has come for expansion and that it can go ahead with confidence.

§ Mr. Peter Mills (Torrington)
The price of bacon has risen to a level never 1935 before experienced. This is due to the holiday season, a strike and to the Danes pushing their bacon into the Community rather than to us. Because of the high price of beef and lamb in this country, consumers have been switching to poultry, and, in particular, to pig meat and bacon. This rising demand has meant a rise in price. Curers are short of pigs, and the right sorts of pigs, and the industry must have the throughput to ensure viability.
In considering the scheme, for the first time the stabiliser is working the other way round. Only a few weeks ago the Exchequer was paying to curers 3s. 4d. a cwt. under the stabilising agreement. It is now working the other way round, with a rate of 4s. 3d. having to be paid by the curers. I welcome this. This is what we hoped would happen.
May I quote from an article in the Farmer and Stockbreeder dealing with the stabiliser: This enabled Sir John Stratton to trot along to the Ministry and say that curers were having to pay these levies because the Worth Committee recommendations had not been implemented. While I agree that we should be much clearer about the future intentions of the Government on the recommendations of the Committee, it is difficult to understand the curers not wanting to pay back when the stabiliser works in the other direction. After all, they cannot have it both ways.
The article continues: So, he said to the Ministry, what about delaying the payment of these levies until after the further Industrial Reorganisation Corporation Report? The article continues with a phrase which I like very much, although I doubt whether I am allowed to use it in the House: The answer from the Ministry is likely to be a raspberry. For once, I am on the Ministry's side. The industry cannot have it all ways. Although the Government are to be criticised for delay in implementing the recommendations and clearly showing to the industry the way ahead, I would also 1936 agree with the Ministry if the answer on this point was a raspberry.

§ Mr. Hoy
I am grateful to the hon. Member for Torrington (Mr. Peter Mills) for saying that people who entered into agreements should face up to them. When the agreement works in their favour they are normally generous, but when they have to pay a little back they are not so enthusiastic. But the agreement is an agreement and we are maintaining it. The words I used in opening were carefully chosen: We hope that it will be possible to include such arrangements, if they were considered necessary, in a scheme operating from 1st April, 1970. Of course, it will be possible to consider any interim recommendation from the Corporation earlier than this in so far as it can be implemented within the existing scheme. The reason for the debate and for the extension of time provided in the Order is that we had hoped the report might have been received earlier. That it has not come sooner is proof that a very thorough job is being done. No conclusions can be reached until the result of the investigation is known.
It is not for me to go into the prices. Although we must remember that there is a responsibility to the producer, we must also remember the consumer, about whom we must also be careful. The Ministry of Agriculture, Fisheries and Food must safeguard the interests of all concerned. We will do so as far as we can, but I think the hon. Gentleman was not quite fair when he spoke of encouragement to the industry. A fair amount of encouragement was given in the Annual Price Review, and this must also be taken into account when making a fair judgment. I had better not go further with that or I shall be out of order.
I am grateful to the hon. Gentlemen for what they have said and I hope that the Scheme will be accepted.