GRANTS UNDER SECTION 61 OF AGRICUL- TURE ACT 1967 FOR CO-OPERATIVE SLAUGHTERHOUSES (Hansard, 3 August 1972)

§ Mr. Mackie
I beg to move, That the Clause be read a Second time.
I shall try to move it as briefly as I can, and in so doing I refer to the argument which arose in the last debate, which in some ways affects what I shall say. We know that the Government want to save the taxpayer money and that they have put a lot of money into the economy. But that money has caused prices to rise considerably. It has probably caused 1041 more inflation than anything else and no one has benefited.
I move the Clause in the interests of the consumer, who has paid for the saving in taxation. On-cost figures for beef in this country between the time when it leaves the farm and reaches the shops average about 50 per cent. or more. I am not suggesting that this has anything to do with the Common Market but I have figures from various places in Europe which show that their on-costs for meat were about 30 per cent. or a little more. This was mainly achieved by farmers' co-operatives selling their produce direct from the farm to the shop. The Clause will bring similar advantages to British farmers. If Government grants given through the Central Council for Agricultural and Horticultural Co-operation were extended to the provision of slaughterhouse facilities it would lead to the provision of more of those facilities. I would like co-operatives to be able to hire those facilities.
It is all very well for the Minister to say that if the end price is good enough farmers will be able to look after themselves, or that if it is a good thing for farmers to do they should do it without a grant. The Minister has said this repeatedly in debates; I think I have fairly paraphrased what he said. Many of the advances in farming since he became a farmer, and certainly in my lifetime, have happened because of the attraction of grants. There have been improvements in drainage, ploughing up, farm buildings and so on, and, however prosperous the farmer, none of this would have been done without the attraction of the grant. Maybe it could be attributed to psychology, but if the Clause were carried it would help not only the farmer but the consumer, too.
When we established the Central Council we gave grants towards the preparation and marketing of many farm products. This included grain, peas and potatoes. I cannot see that the preparation of those commodities is very much different from the slaughtering of meat. The slaughtering of meat, particularly beef, should come under the aegis of the Central Council, and the Minister should give it funds to do so.

§ Mr. Prior
I agree with a great deal of what the hon. Member for Enfield, East 1042 (Mr. Mackie) has said. I do not want it to be thought that, in making the remarks I have made in the past and will probably make in the future about the need for the industry to look to the end price for its return, I do not think there are various facets of agriculture, fisheries and other industries in which subsidies or grants have an important part to play. In the last two years I have shown that I regard some grants as being important for the life of the industry. The hon. Gentleman mentioned drainage grants, cattle grant schemes, and so on, and these I have fully supported. I have also supported the making of grants for co-operative enterprises amongst groups of farmers.
The new Clause would place beyond doubt the power of Ministers to provide by a scheme for grants to be paid on co-operative slaughterhouses. Anything which helps to reduce the on-cost between the farm gate and the housewife's table should be encouraged, and for this reason I set up two years ago a committee under Sir James Barker to inquire into the whole system of contract farming. The committee has now reported to me. The report is being printed and it will be available towards the end of September. I have also been considering what steps the Government should take in their marketing policy and how this review will fit in with the policies being considered for greater producer co-operation in the Community.
The hon. Gentleman is asking for an extension in a scheme which was introduced by the Labour Government and was originally intended to help farmers to co-operate in activities which are normally carried out on the farm itself. Many of the vegetable co-operatives which have been set up are either on the farm or very close to the farm, generally where the products are used and where the co-operative benefits a small group of farms.
The European Community has before it a draft regulation dealing with assistance to producer groups, and the activities of groups which would qualify for aid if the draft regulation came into force concern the production and marketing of members' produce. Most are activities normally associated with farming, but there are some exceptions, including the 1043 provision and operation of slaughterhouses to deal with members' livestock. The document is only a draft, and we shall be fully consulted on it. I would much prefer to wait and see the form that the regulation will take before proceeding further with this idea.
I am not unsympathetic towards the case which the hon. Gentleman is putting forward; it is worth considering. But I want to get it right in the context of Sir James Barker's report, in the context of the proposals we are considering for marketing generally and in the context of the Community's draft regulation. For that reason I do not wish to proceed with the idea at the moment, but I think the House will want me to look favourably at the whole question of producer co-operation and not necessarily to restrict it as it is being restricted now.
That is as far as I can go today, but I hope that I have given the hon. Gentleman an indication that we are, broadly speaking, sympathetic to his case.

§ Mr. Mackie
Before the right hon. Gentleman sits down, he has never been afraid to give us an idea of the content of reports—for instance, the price review—before they are published. Would he like to say what is in Sir James Barker's report?

§ Mr. Prior
That would be improper. As I have told the House in a Written Answer, it is a useful report, but it needs to be seen in conjunction with other ideas which I hope to put forward by the time we return to Parliament after the recess.

§ Mr. Alfred Morris
The Clause has been ably moved by my hon. Friend the Member for Enfield, East (Mr. Mackie). As always, his case was well documented and persuasive. He argued that the Amendment was important to producers and consumers alike, and that argument has been accepted by the Minister, whose response has not been unreasonable.
The Clause and the Amendment provide an opportunity for us to pay a well deserved tribute to Sir Roger Falk and his colleagues at the Central Council for Agricultural and Horticultural Cooperation. With more help from the 1044 Government the central council could have made more progress, and it is sad that producer co-operation has not received the impetus it deserves.
My views were explained at some length in an article which I contributed to the Business News section of The Times, in which I explained how, with the encouragement of the central council, farms in England and Scotland were being brought together. I gave examples of producer co-operation linking farms in the two parts of the country. I received several inquiries from West Germany after my article appeared. My correspondents felt that what the central council was doing was extremely important and could be of considerable value in West Germany.
I hope that the right hon. Gentleman will take seriously the points raised by my hon. Friend the Member for Enfield, West. All on this side of the House feel that producer co-operation should now be given a new impetus. I recall my right hon. Friend the Member for Workington (Mr. Peart) saying that he took greater pride in having set up the Central Council for Agricultural and Horticultural Co-operation than in anything else he did as Minister of Agriculture, Fisheries and Food. I believe that his initiative in setting up the central council will be seen in years ahead as an important achievement in our agricultural industry.
I am grateful to the right hon. Gentleman for saying that he will look sympathetically and constructively at the points raised in the debate. With the assurance that he has given, I feel sure that my hon. Friend will wish to withdraw the Amendment.

§ Mr. Mackie
I thank the Minister for his reply. Perhaps some of his hon. and right hon. Friends will not so warmly welcome his remarks about the linking with Common Market countries.
I beg to ask leave to withdraw the Clause.