HC Deb 10 July 1973 vol 859 cc1304-24

  1. (1) If for any accounting period the revenues of a sugar refiner fall short of the total sums which are properly chargeable to revenue account for that period and the Minister of Agriculture, Fisheries and Food so directs, the Sugar Board shall make good the deficiency.
  2. (2) The Minister of Agriculture, Fisheries and Food may with the approval of the Treasury give directions as to the way in which the revenues of a sugar refiner are to be computed for the purposes of this section and as to the sums to be treated for those purposes as properly chargeable to revenue account.
  3. (3) In his section "sugar refiner" means a person other than the British Sugar Corporation Limited who carries on business in the United Kingdom as a refiner of sugar.—[Mr. Anthony Stodart.]

Brought up, and read the First time.

The Minister of State for Agriculture, Fisheries and Food (Mr. Anthony Stodart)

I beg to move, That the clause he read a second time.

Bearing in mind what was said a little earlier in our discussions I am sure the House will appreciate the delicacy of my position. I am aware of many precedents for new clauses on report stages on other Bills, and it is not unusual—although my hon. Friend the Member for Cirencester and Tewkesbury (Mr. Ridley) ventured to suggest it was—for an agriculture Minister to be present on the Front Bench and indeed it has not been unusual in the past for such a Minister to be in charge of a clause on a housing Bill.

I realise that I must deal only with the merits of the clause but I hope that I shall be allowed to say that there is a precedent for moving procedure resolutions on Report on a Finance Bill. I quote as an example the Finance (No. 2) Bill 1967. I am informed that my right hon. Friend the Member for Wolverhampton, South-West (Mr. Powell) was at that time the Financial Secretary to the Treasury when every Bill carried a clause authorising advances to nationalised industries and that a procedure resolution was required each time.

I shall try to explain to the House that the clause is necessary to provide an appropriate statutory basis for the supplementary payment to sugar refiners announced by my right hon. Friend the Minister of Agriculture in his statement to the House on 28th March. As announced in that statement, until now these payments have been made on a temporary basis from the contingencies fund. The provisions of this clause will enable my right hon. Friend to direct the refiners eligible for those payments to prepare revenue accounts in an appropriate way and to include only the necessary relevant details.

Mr. William Baxter (West Stirling-shire)

Could the Minister of State give the number of persons or companies involved and the estimated total amount?

Mr. Stodart

I shall come to that matter in due course; I am trying to be brief.

Once the accounts are approved and the amount by which the revenues fall short has been established, the Sugar Board will be directed by my right hon. Friend to make the payments to the refiners. The money paid by Parliament for this purpose will be paid to the Sugar Board under the terms of Section 7(2) of the European Communities Act 1972.

It will be recalled that the supplementary payments are necessary because the refining margins resulting from the arrangements agreed by the Community in January have not been adequate to ensure the refining and marketing of the sugar that we are committed to take under the Commonwealth Sugar Agreement. I am certain the House will agree that it is essential that we have the wherewithal to honour an undertaking which we regard as of the highest importance.

The payments are designed to bring the margin up to the level the Minister considers necessary to enable the Government to honour their commitments under the agreement. So far £3 million has been paid out of the contingency fund, and we estimate that a total of £11 million will be required. With that explanation, I hope that the clause wilt commend itself to the House because we believe that hon. Members on both sides of the House are sympathetic to its purpose.

Dr. J. Dickson Mahon (Greenock)

I welcome the new clause. I appreciate that because of the heavy business before the House the Minister saw fit to curtail his remarks but I do not think we can leave the matter there. The Minister gave no idea how long he thought the present uncertain situation would persist. There are stories in the Press that the European Commission is taking a very dim view of the Government's announcement made on 28th March—in which announcement I heartily concur—and is pursuing the matter further, perhaps even to the point of taking legal action against the United Kingdom.

Certainly the new clause is as wide as a clause can be. It has no time limit and it lays down no open process by which the margins should be calculated. The matter is to be computed in a way the Chancellor of the Exchequer directs. When the Queen in "Alice Through the Looking Glass" is asked for a definition, she says "Whatever I say it is, it is".

I think I may have put that allusion a little inaccurately but, if I have, no doubt I shall be corrected when the Minister replies. The point I am making is that the clause could not be wider than it is. The second paragraph clearly leaves the matter of the computation of revenues to be decided by the Chancellor of the Exchequer. I do not object but I am merely underlining that the provision is as wide as wide can be. As I understand it, the first part of the clause leaves it to the Chancellor of the Exchequer at any time during a year to vary the monies. There is no guarantee that the refiners from one year to another or one month to another will know what the position will be.

I have an interest in this matter because I have in my constituency the only two sugar refineries in Scotland. Those refiners are wholly dependent on the supply of cane sugar. Therefore, I speak in a rather selfish capacity since I represent 2,000 workers who directly and indirectly are involved in sugar production. I do not think I need apologise for that. Unless we are able as a country and as a Community to honour the Lancaster House agreement, we shall place in jeopardy the livelihood and wellbeing not only of the workers and their families in my constituency but of the millions of people in the developing countries of the Commonwealth who grow the cane sugar for us.

For that reason the clause is very important, and I am glad that both sides of the House are in favour of it. At the same time the Minister should tell us how he intends to resist an attack upon the clause, if there is to be an attack, by individual Commissioners or parliamentarians in Strasbourg or even by the Commission itself.

I hope, too, that the hon. Gentleman will give us some idea about when the power is likely not to be needed. I am thinking of the review in October of the common agricultural policy announced by the Minister of Agriculture which he said that he hoped would see some changes made. I hope that one of the changes will be the attitude of some Europeans, especially the French sugar beet producers, to our obligations to the Commonwealth.

I hope that the Minister of State is willing to answer these two points.

5.45 p.m.

Mr. Nicholas Ridley (Cirencester and Tewkesbury)

I begin by assuring my hon. Friend the Minister of State that I am delighted to see him on the Treasury Bench with Treasury Ministers. I should be much happier if Treasury Ministers were more often on the Front Bench when agriculture Bills were being discussed because their presence might achieve some economy in our affairs.

I was not very impressed with the precedent which my hon. Friend produced. It was common practice to deal with the nationalised industries in Finance Bills but I always objected to the principle of bringing in a new subsidy of an agricultural nature as it were by a side wind. However I hope that the Government take the point and will not do it again.

With the Lancaster House agreement having been concluded on 28th March, there was every opportunity for the Government either to have legislated separately for this or to have introduced their new clause in Committee when we should have had time to investigate the matter and to decide whether we approved of it. I do not feel as certain as the hon. Member for Greenock (Dr. Dickson Mabon) about the rightness of this. I agree that the accountability of the clause is very weak and that such matters as how much it will cost and on what basis the figure will be assessed leaves a great deal to be desired.

I hope that my hon. Friend will say what margin we think that sugar refiners should achieve. This involves the Government in deciding what is a fair margin, as I understand it. Can my hon. Friend say what he believes to be a fair margin for a sugar refiner to achieve on his turnover or on his capital? It will be very interesting to have this figure. We shall be able to check it with the view of the Price Commission on what is a fair margin when controlling prices or that of any other food stuff under the counter-inflation policy.

I think that there will be a tendency to say that here we are subsidising to keep up margins, whereas other parts of the Government are using the law to keep down the margins. We need a definition of a fair margin so that we know what it is that the Government are seeking to achieve. I imagine that this arises as a result of the protection of the beet industry brought about by the EEC which for the first time will make cane sugar less viable as it comes from overseas. If that is so, I should like to know the precise details whereby cane sugar has become uncompetitive and therefore has to be subsidised.

I should also like to know whether the European Commission has agreed that we should now set forth on this piece of subsidy of our own sugar refiners. To say the least, it is against the spirit of the Treaty of Rome though it may not be against the law, but it seems curious that we should have taken action which can be thought of only as being hostile to the common agricultural policy. I am no great supporter of the CAP, but I believe in reforming it rather than in evading it. Perhaps my hon. Friend can give us a little more information about what is involved in relation to the Commission and our obligations under the CAP. This is a very difficult problem. I accept entirely that the desire of the French to grow too much beet and to ship it over here matched with the demands of the under-developed nations, is a difficult conundrum to sort out.

We ought also to be given more information about the present situation. It makes me very uneasy that apparently we should be in breach of our European undertaking in bringing about this subsidy. I should much prefer my right hon. Friend the Minister to go to Brussels and to sort out the common sugar policy, which is really what is needed, so that we got an agreed solution which allowed for imports of cane sugar and a decent share of the market for European beet producers.

At the moment I am not happy that we should let the clause go without a little more information.

Mr. John Roper (Farnworth)

Like the hon. Member for Cirencester and Tewkesbury (Mr. Ridley), I welcome the clause, but I share some of his reservations about it and have one or two others of my own.

It is important that in some legislation—and the Finance Bill is a convenient if not the appropriate place—we should ensure that we can give practical implementation to the pledges given to Commonwealth sugar-producing countries in the Lancaster House agreement and that we should maintain those commitments not only at the end of the present Commonwealth Sugar Agreement but beyond 1974 in whatever policy is developed by the Community.

The hon. Member for Cirencester and Tewkesbury referred to the margin of the sugar refineries. What is an appropriate margin? What is appropriate to consider within the margin of a sugar refiner? How much of Mr. Cube's political advertising is it appropriate to include within the margin of a sugar refiner? I hope that we shall have some information about this because I am sure that many of my right hon. and hon. Friends would be unwilling to support a clause which merely provided Mr. Cube and his friends with more money for advertising expenditure of this sort.

I turn now to another point raised by the hon. Member for Cirencester and Tewkesbury. I was very concerned to read in the Financial Times today the report of the Commission's investigation and the fact that Commission experts had completed a dossier against Britain for continuing to give special subsidies to its sugar refiners. According to the Financial Times, theoretically the way is clear for the Commission to tell the United Kingdom Government this week that we are in breach of the Rome Treaty. We need a clear assurance from the Minister that at the meeting of the Council of Ministers next week he will take action to ensure that we are permitted to continue what it was agreed we should be able to do under the Treaty of Accession and to import sugar from the Commonwealth. That has to be clear. I hope that we shall be told that the Minister intends to go to the meeting of the Council of Ministers early next week in order to get that clarified with the Commission and the Community as a whole.

Finally, I should like to raise a detailed point on subsection (3) which defines a "sugar refiner" as a person other than the British Sugar Corporation Limited who carries on business in the United Kingdom as a refiner of sugar. Presumably this refers to cane sugar producers. What happens if, for ex ample, one or more of the cane refiners merges with the British Sugar Corporation? Would the provisions of the clause permit that new body, if it continues to use the name British Sugar Corporation, the Corporation having taken over other bodies, to receive subsidies, or would it be necessary for new legislation to be introduced to permit such a merged body to receive these important payments?

I hope that in reply the Minister will deal with that point which, although hypothetical at this stage, is none the less a matter of concern to some hon. Members.

Mr. Baxter

This is a peculiar clause. It seems to be presenting a blank cheque to the Ministry and to the British Sugar Corporation of up to £11 million or thereabouts. That may seem a small amount to some people, but to others it is a large sum. We have not had a very satisfactory explanation.

In introducing the clause the Government present themselves with some fundamental difficulties and questions which must and should be answered on the Floor of the House on how the subsidy for sugar will be in unison with the common agricultural policy. We are entitled to know the answer to that question. If the principle of a subsidy for, sugar is accepted by the common agricultural policy, would a subsidy for other products which may be of interest to consumers in this country be permissible under the rules and regulations which seem to apply to sugar?

It is not right that a clause like this should be submitted to the House without more facts and figures and a better explanation so that we may understand what the Minister and the Government are trying to get at.

I have considerable sympathy with my hon. Friend the Member for Greenock (Dr. Dickson Mabon) who rightly champions the inhabitants of that town, about 2,000 or more of whom are engaged in the refining aspects of the sugar industry, but, as he said, many more people in the underdeveloped parts of the world are also largely dependent on the sugar industry.

Again, we should have a clear statement from the Minister of State for Agriculture, Fisheries and Food on why it is permissible for French farmers to increase their production of beet sugar without any apparent protest by the British Government.

If, as the Government have indicated in discussions with the under-developed countries, they are concerned for their well being not only in the immediate, but the foreseeable future, we should have a better explanation of the full intent and meaning of the clause from the Minister of State.

I apologise to my hon. Friends who wish to go on to other aspects of the Bill, but an important principle is involved. If we do not recognise it and get a proper explanation, then it will be extremely remiss on our part. However, if we get a satisfactory explanation we can follow it up on other aspects of food which are being priced out of the market for many people. A great principle is involved in the clause. I shall listen with interest to what I hope will be a more general explanation than has so far been given.

6.0 p.m.

Mr. Tam Dalyell (West Lothian)

The Minister of State referred to the delicacy of his position in coming to take part in proceedings on the Finance Bill, but I am sure that all Finance Bill regulars welcome him to the debate.

The Minister has the great good fortune to be my parliamentary neighbour. I should like to remind him of those hot months of May and June 1970 and the little matter of the sugar beet factory at Cupar. Those who know the hon. Gentleman's recent political history think that he has the most incredible nerve to bring in subsidies of £3 million now and eventually up to £11 million. It will be within the recollection of my hon. Friend the Member for Renfrew, West (Mr. Buchan), who at the time had responsibility for Scottish agriculture, that the hon. Gentleman and his hon. Friend the Member for Fife, East (Sir J. Gilmour) in particular went round Scotland during the General Election saying that the wicked Labour Government was about to close the sugar beet factory in Cupar, the only one we have, and that the Conservatives would maintain employment in that factory.

Mr. J. Bruce-Gardyne (South Angus)

I was also very much concerned about this matter. However, in all fairness, the hon. Gentleman has made an allegation against the Minister of State which cannot be sustained. The statement that was always made on behalf of the then Conservative Opposition at the time of the General Election was that the future of the factory would be re-examined, and that re-examination, as the hon. Gentleman knows, was undertaken.

Mr. Dalyell

The term "re-examined" is interesting. The fact is that the farmers in West Lothian and the Scottish NFU had the definite impression that "re-examined", or whatever the terminology was, meant that the sugar beet unit at Cupar would be reprieved.

All I am asking is that some time in the near future, when it:s convenient, the Minister will go in sack cloth and ashes to the Scottish NFU, of which he was a distinguished member, and apologise for what he did in May and June 1970, because it is different from what is being done in July 1973.

Mr. David Clark (Colne Valley)

The Opposition welcome the clause because it permits the Commonwealth Sugar Agreement to continue, at least for the time being.

The clause does not introduce anything new, because the sugar subsidy to the refiners has taken place since 1928, when the agreed total was about £9 per ton. I understand that we are having to tackle the problem in this way because of our entry into the EEC. Some of my hon. Friends have referred to the way that the EEC is viewing our sugar industry. Will the Minister be more forthcoming on this point?

We have a complicated sugar industry apparatus. One problem is that we divide the market. In the spring of this year all 16 of the European sugar refiners were fined £3¼ million for taking part in a cartel. Will the Minister assure us that this will not affect the British Sugar Corporation and the various sugar refiners in this country?

Will the Minister also be more forthcoming about the use of the moneys arising from the clause? Are they to be used only for the refining margins? Are they to be used to help the Sugar Board, which buys sugar under the Commonwealth Sugar Agreement at a higher than open market price and then sells it to the refiners at the open market price, obviously at a loss? Will some of the money be used to support the British Sugar Board?

We have heard a lot recently about sugar subsidies. A couple of weeks ago, at Question Time, the Prime Minister told us that there was a subsidy on sugar. It was ironic that in his speech at Sidcup on 29th June the right hon. Gentleman again referred to the subsidy on sugar, yet a day later the subsidy of £15 per ton was removed. Will the money raised under the clause be used to put back the sugar subsidy that was removed by the Government on 30th June, as a result of which, at a stroke, the price of a 2 lb. bag of sugar was put up by 11,p?

I hope that the Minister will be a little more forthcoming and tell us something about the various refining companies. I hope, too, that he will deal with the question asked by my hon. Friend the Member for Farnworth (Mr. Roper) about a possible merger between one of the refining companies and the British Sugar Corporation. There are some rumours about such a move and we feel that the situation should be clarified, because if one of the interpretations put on the clause turns out to be true it might be found that a large part of the sugar refining industry is not able to receive Government support.

Mr. Anthony Stodart

I shall do my best to be as forthcoming as I can. I felt that the House would wish me to make a short opening speech, following which hon. Members would have an opportunity to ask questions and I should then do my best to answer them.

The hon. Member for Greenock (Dr. Dickson Mabon) asked about the length of time for which this money would be available. It cannot continue beyond the period of the present system, which is the end of 1974. That is the date on which the Commonwealth Sugar Agreement ends. As the hon. Gentleman knows, renegotiation is taking place and new arrangements will have to be made. I shall return to this in a moment I know only too well the hon. Gentleman's anxiety about his constituency. The origin of our difficulties over the refining margins is the completely different nature of the refining industries in this country and those in the Six. In the Six, the refining industries are relatively minor subsidiaries of enterprises engaged predominantly in the production of beet sugar, while in this country they are separate enterprises depending solely on refining. That means that the margin they need is essentially radically different. We accept that changes must take place in the United Kingdom industry to bring it more into line with the structure of that on the Continent, but that is a difficult thing to bring about, given that independent firms are involved.

The reorganisation of the industry in this country has been under consideration for a long time. I hope that a conclusion will be reached in the reasonably near future, and that as a result of such reorganisation the subsidy can in due course be abandoned. We do not intend to retain it for any longer than is necessary to do what I regard as crucial, and that is to fulfil our obligations to the Commonwealth.

My hon. Friend the Member for Cirencester and Tewkesbury (Mr. Ridley) asked about the margin itself, as did the hon. Member for Farnworth. The level of the margin and the yield have been established after an independent investigation by a firm of accountants. The margin of £17 a ton is the minimum which the refiners would have received in 1973 as a result of the basis agreed upon following that independent investigation and embodied in an undertaking given to the Chancellor of the Exchequer by Messrs. Tate and Lyle in 1971. The margin that has been suggested by the Commission is about £12 a ton, and there is therefore a gap of £5 to be bridged in order to satisfy the commitment.

The hon. Member for West Stirling-shire (Mr. Baxter) asked about the number of companies involved. There are four—Messrs. Tate and Lyle, Manbre and Garton, Ragus Sugars and Albion Sugars. Some of these companies have activities other than sugar refining, and I cannot emphasise too much that the payments are confined strictly to their refining activities.

The hon. Member for Farnworth also asked what I thought was a highly practical question, namely, what would happen if, for example, the British Sugar Corporation were to become the dominant partner in the sugar industry. He asked whether we would have to re-legislate. The answer is that we should not, because the position of the corporation is safeguarded under Section 20 of the Sugar Act. That is why it is excluded on this occasion.

Dr. Dickson Mabon

Could these advances be continued in some form under that section in order specifically to protect the cane sugar crop?

Mr. Stodart

I should like notice of that question. I shall write to the hon. Gentleman about it. I am assured that legislation would not be necessary, and that is why the British Sugar Corporation is excluded from the clause. It is covered by what we are doing for the refiners.

Mr. Roper

Will the hon. Gentleman examine the Sugar Act to see whether it covers the corporation with regard to cane sugar? I ask that because, as I understand it, the corporation was set up to deal with beet sugar and not cane sugar.

Mr. Stodart

That is one point about which I inquired, because slightly unusually for me, I anticipated the question's being asked. My information is that it is covered, but I shall check the matter and let the hon. Gentleman know.

The hon. Member for West Stirling-shire asked me to be more forthcoming about the opportunities that would arise as a result of the assurances given at Lancaster House. We expect that the Council of Ministers will shortly have to consider three important matters relating to sugar—the adherence to a new International Sugar Agreement, the arrangements to be made for a continuing supply of Commonwealth sugar to the Community after the Commonwealth Sugar Agreement terminates at the end of 1974, and the future of the Community's internal sugar régime after the present temporary quota system ends in the middle of 1975.

These questions are all more or less inter-related, and they will have to be considered by the Community in relation to each other. We shall play a full part in those discussions, and our aim will he to ensure a continuing market in the Community at fair prices for the sugar producers of the developing Commonwealth, together with a fair share for our own producers of the opportunities to grow sugar beet, which I believe will be available. I do not want to go into off-the-cuff statistics, but I believe that there is a deficit on sugar in the Nine, that consumption is growing, that the Australian quota is being phased out, and that, therefore, by 1975 there should, by all our calculations, be complete room for the 1.4 million tons from the developing countries, together with a reasonable share for increased sugar beet growing in this country.

6.15 p.m.

But until the negotiations are complete, I am sure the House will appreciate that it is not possible to quantify precisely the size of the post-1974 beet acreage.

Of course, I must deal with a point that was raised by at least three hon. Members—the alleged finding by the Commission that this subsidy is illegal. I have seen the report in today's Financial Times, and the Commissioners naturally know all about our subsidy, which was announced to the House and reported to them. They have been considering its compatibility with the Treaty of Rome, as it is their duty to do. They have not yet informed us of their conclusions, but we are naturally keeping in the closest touch with them.

The Commission and our fellow member States are well aware of the connection between this subsidy and our need to honour our commitments under the Commonwealth Sugar Agreement until the end of 1974, when it finishes. The honouring of that commitment is enshrined in Protocol 17 to the Treaty of Accession and it is accepted by all the countries of the Community as an obligation on them, although in practice it falls to the United Kingdom to implement the commitment by taking the sugar. No one in the Community would wish to do anything that prevented that commitment from being fulfilled.

Mr. John Biffen (Oswestry)

My lion. Friend has clearly explained why there should be not the slightest shadow of doubt about this issue in the minds of the Commissioners. Therefore, will he say for how long the Commissioners have been considering this, and when he thinks they will reach their final conclusion?

Mr. Stodart

It is alleged in the Press today that they have come to certain conclusions. But there will be meetings. My right hon. Friend is attending a meeting of Ministers next week at which this question will no doubt be raised. When the subject will be resolved, I cannot say, because if by any chance there were opposition in the Commission or the Community, the resolution that we are bound to show in order to fulfil the commitment, which I regard as sacrosanct, would of course make it take that much longer.

We believe that this subsidy is completely compatible with those provisions of the Treaty of Rome that deal in national aids. But even if there were some doubt about that, given the good will that I believe exists in the Community on this matter, there are other provisions in the Treaty the use of which would enable the subsidy to continue to be paid.

Mr. Baxter

It is surely a strange state of affairs if it is alleged in the Press—I did not see it—that agreement has been reached—[HON. MEMBERS: "No."] It has not been reached. Well, that is not so bad. If it had been reached, I should have been amazed that the Government were not aware of the fact.

Mr. Stodart

I am sure that the hon. Member is as full of good will as he ordinarily is towards me.

I think that I have answered the points put to me. To emphasise still more what I have said about the feelings within the Community, it is not without interest to have read in today's Guardian that the Community is determined to see this undertaking fulfilled.

Mr. Dalyell

Will the Minister go in sackcloth and ashes or will he eat humble pie, or whatever agricultural Ministers do to show penance, on the subject of Cupar?

Mr. Stodart

I did not wish to fall out with my next-door neighbour, but I thought that the hon. Members' intervention was of almost total irrelevance to the subject of this debate. I am bound to put it on record that what, at the last election, we understood to do—I feel that I shall be ruled out of order at any moment—was to examine the position, and examine it we did.

I hope that I have answered all the questions put to me. I believe that the House has made it clear that it supports the Government's objectives, and I therefore hope that it will agree to the new clause.

Mr. Norman Buchan (Renfrew, West)

The situation now is slightly more ominous than when we started this debate. We are concerned with the future of the Commonwealth producers and I wish that the Minister had recognised the anxiety that still exists there.

We have now been talking in terms of an agreement for the importation of Commonwealth sugar—1.4 million tons, if my figure is right—which will now be wholly supported by the existing subsidy, phasing out at the end of 1974. The Minister said that we need not worry, because good will exists in the Community, which has a net deficiency of sugar, and that the expectation is that this will continue. This, of course, is based upon two reactions of the Community. One was the famous aura à coeur and the other was the firm assurances, described in this House as "bankable" assurances. But those assurances were bankable a year ago; they have not yet been banked. That is what we are concerned about.

I understand the problem facing this country—that it is our responsibility for the intake, but that the commitment relies now upon Community assurances. Now we are told that the Community is examining the question whether this premium is in order. The best information that the Minister has is that something is alleged in the Financial Times. If that is to be the kind of basis on which we have to accept bankable assurances for the future it is not a very good advocacy for our support of the clause.

We support the clause because we think that it is necessary, but since the debate has ranged wide I must take the opportunity to express this anxiety. We still have no firm commitment of acceptance of involvement in the International Sugar Agreement, for example, by Commonwealth countries. We still have no continuing guarantee of the continuation after 1974 of the 1.4 million tons of cane sugar.

It is not enough to argue that this will happen because of good will or a net deficiency. In 1972—certainly from 1968 to 1972—the Community was a net exporter of sugar. If the suggestion is that with the injection of the three—Denmark, Ireland and Britain—it has now ceased to be a net exporter and now has a net deficiency, this must have relevance to the gap between the amount by which they are now said to be deficient and the 1.4 million tons. If the gap of deficiency is less than the 1.4 million tons, it begins to place that importation in jeopardy. We must have an assurance upon this matter, and we have only two months in which to get it. The International Sugar Conference in Geneva will be reconvening at the end of August and going on into September, and we shall be leaving the House at the end of this month without that guarantee having been brought back from Brussels. We cannot rely on allegations, or otherwise, in the Financial Times.

The second point that I want to emphasise was also referred to by my hon. Friend the Member for Colne Valley (Mr. David Clark). We must be perfectly clear that these are in no sense a direct consumer subsidy. They are a very necessary subsidy for the refiners, partly because of our concern about the needs of the producer countries, which are operating on a seven-year cycle. This is a very serious problem. When we deal with the question of food subsidies, the Prime Minister tells us that, after all, they have subsidies for butter, sugar and potatoes. Is this was he means? If it is, the Prime Minister is conning the British people. When he was assuring us that the food subsidies were an open question and that the Government would look at it openly and were willing to examine anything with the TUC, the consumer sugar subsidies were in the process of being scrapped, which is what we have been doing in statutory instrument after statutory instrument this year.

I wish that the Under-Secretary, who has now enhanced and added grace to our Finance Bill discussions, would tell the Prime Minister that we shall no longer tolerate being conned by the suggestion of food subsidies at the very time when he is scrapping them.

My next point is on the matter raised by my hon. Friend the Member for Farnworth (Mr. Roper), concerning a very important question, also alleged in the Financial Times apparently the fons et origo of information, for the House, of the possible merger between the British Sugar Corporation and the refiners.

We are told that this will be taken care of by Section 20 of the Sugar Act. I should like more information about that. Subsectiton (3) of the new clause merely states that In this section ' sugar refiners' means a person other than the British Sugar Corporation Limited. That seems to show an astonishing amount of trespass on the part of Section 20 of the Sugar Act if the Government have thought of this situation so closely as to cover it. This is very unexpected. I should prefer more assurance on this point.

The other point was that the Minister said that he could not give an assurance about the post-1974 beet acreage crop. We are now in the situation that the Common Market, having been a net exporter of sugar—I should like to examine some of the figures—has a deficiency in sugar, presumably because of the injection of the three—Denmark, Ireland and Britain—but no assurance can be given about the sugar beet acreage. On the contrary, what is happening is that the beet acreage in Europe is being encouraged because of the level of prices being placed on beet, and the end price is beginning to shrink this 1.4 million tons importation. Therefore, we want assurances whether the Government are saying, "Because of the firm commitments that we as a Government, over the years and throughout the agreements of the last two years, including the Lancaster House Agreement. have given to the Commonwealth, at the Council of Ministers next week pressure for two things must take place; first, involvement in the International Sugar Agreement, and, secondly, the question of the end price of sugar in Europe and the sugar beet acreage within the Community as a whole." By that time it will no longer be a question of Britain alone.

Finally, I revert to the point raised by my hon. Friend the Member for West Lothian (Mr. Dalyell). He referred to my role in this matter in relation to the Cupar factory. The Minister said that no assurances were given. I accept that they were merely re-examining the situation. First one re-examines the situation and then one kills it. That is what has happened. There is no doubt that the impression was given, and campaigning took place among farmers in Scotland—

Mr. Dalyell

And the hon. Gentleman knows it.

Mr. Buchan

—that the sugar beet factory would be continued. If the Minister has any doubt he should look at the vote cast by the hon. Member for Fife, East (Sir J. Gilmour) in the Scottish Grand Committee, when, on an extremely important vote, he did not vote with the Government because of his anger at the way that he had been let down. Having campaigned in his General Election campaign in connection with that factory, he was let down in respect of the Government's promises.

The best that we can say about the promise is that the Government's attitude was the aura à coeur. If that is the firmness of aura à coeur, it is the reason for the present anxiety, too, about the Commonwealth aspect. In view of the unsatisfactory replies, perhaps we should make the gesture of voting on this matter, but we cannot, because we welcome the clause. It is necessary. I wish that I could find some other means of signifying our anxiety about the present position, while recognising that the clause must not only be supported but welcomed.

6.30 p.m.

Colonel Sir Tufton Beamish (Lewes)

I should like to take up the time of the House for only 60 seconds, to say that there is no reason whatsoever to doubt the good faith of the Community concerning the promise with regard to the 1.4 million tons.

If there were to be any backsliding on this question, it would be of the gravest concern to all hon. Members, on both sides of the House. The national interest and the national honour are involved. We in the Conservative European delegation most carefully inquired about this from the Commissioner—M. Cheysson—and there is not the slightest doubt that he has this matter very much at heart.

What a pity it is that right hon. and hon. Members of the Opposition make these speeches at Westminster and not in Strasbourg.

Mr. William Hamling (Woolwich, West)

I shall not detain the House for more than a minute. I represent a constituency in south-east London where there are people involved in the sugar refining industry. They are very concerned about this question. They would not have been satisfied with the sort of assurance that we have just had from the hon. and gallant Member for Lewes (Sir T. Beamish), or the assurance we had from the Minister.

I do not want to add to any of the problems that the people concerned are facing. My hon. Friend the Member for West Ham, North (Mr. Arthur Lewis) knows exactly what I have in mind. They are involved in very difficult negotiations. The firm for which they work in south-east London is very concerned. If the hon. and gallant Gentleman wants to Know how disturbed people are, he should talk to these workers and the representatives of that firm, and to sugar refiners in this country. They are extremely concerned about the future employment of thousands of people and a very profitable industry in Britain.

Mr. Arthur Lewis (West Ham, North)

I should like to cross the "T's" and dot the "I's" of the speech of my hon. Friend the Member for Woolwich, West (Mr. Hamling). I should declare an interest. In my constituency and an adjoining constituency we have one of the largest sugar refiners in the country, and some of my constituents work there. I agree with my hon. Friend that it would be as well for some of the pro-Europeans, who spend the best part of their time in the so-called European Parliament—which is nothing more than a talking shop—to meet the workers in the factories and refineries, and some of the directors of the company, and discuss matters with them. They would find that they are not too keen to accept the word of Ministers at the Council of Ministers.

Will the Minister now give an assurance that whatever discussions may ensue and whatever proposals may be made, he will consult the trade unions and the employers in the industry—and, if time permits, the House—asking for the views of those concerned, before he agrees to anything that might be detrimental to the workers in the industry? Unless he does, and if the hon. Member is so sure that everything is going to be all right, the Minister ought to be pleased to give us an assurance that he will come back, because he knows that the answer will be favourable.

Mr. Anthony Stodart

I speak again with leave of the House. I am sure that the hon. Gentleman is aware, as is the hon. Member for Greenock (Dr. Dickson Mabon), that the Minister is having consultations with him and, I am certain, with the trade unions, and that he will undoubtedly take account of all these views.

Mr. Lewis

The hon. Gentleman says that the Minister will take account of those views. We have had taking account—

Mr. Speaker

Order. The hon. Member has made one speech, and he resumed his seat. I will allow a brief interjection only

Mr. Lewis

Before the Minister sat down, I rose and was about to ask him whether he would give an assurance that whatever settlement is reached, he will, before agreeing with it, seek the approval of the unions and the employers.

Question put and agreed to.

Clause read a Second time, and added to the Bill.

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