Glasshouse Industry

HC Deb 20 March 1975 vol 888 cc1840-4

9. Mr. Michael Latham

asked the Minister of Agriculture, Fisheries and Food what representations he has received from the National Farmers' Union regarding his decision to discontinue the oil subsidy for the glasshouse sector of horticulture; and what reply he has sent.

14. Mr. Blaker

asked the Minister of Agriculture, Fisheries and Food what recent consultations he has had with the NFU about the provisions of aid to the glasshouse sector of the horticulture industry; and if he will make a statement.

Mr. Strang

Representations have been received from five NFU branches and my right hon. Friend discussed the position of the glasshouse industry with the president and other officeholders of the NFU on 3rd March. It has been made clear that we do not intend to reintroduce the temporary fuel oil subsidy.

Mr. Latham

Why did not the Government continue with this subsidy at least until the end of July, when the new EEC régime comes in, rather than taking this disgraceful action to the advantage of our Dutch competitors?

Mr. Strang

It is wrong to relate the temporary oil subsidy to the plans which are at present being considered by the Commission regarding the long-term future of the industry. I ask the hon. Gentleman to recognise that this subsidy, which was very substantial at the time, was a temporary subsidy and that this was made clear all along.

Mr. Newens

Does not my hon. Friend agree, however, that figures with which he has provided me through a parliamentary answer and a letter show that EEC glasshouse producers are receiving a subsidy which our growers are not receiving? Does he further agree that in addition to this the Dutch producers get very cheap oil? In these circumstances, is not the failure to prolong the subsidy placing our glasshouse industry in severe jeopardy at a time when we need the products which will otherwise have to be imported?

Mr. Strang

I certainly recognise the deep concern of my hon. Friend and his glasshouse grower constituents regarding this decision. However, I ask him to bear in mind that the answer to which he referred showed that the level of subsidy paid by the British Government was verb generous compared with that paid by other EEC Governments. Indeed, we started the subsidy before many of the other countries did. Furthermore, some of the other countries have not paid any subsidy and have no intention of doing so.

Mr. Blaker

Is the Parliamentary Secretary aware of the calculations of the NFU, which show that a grower with an 80-tons-per-acre crop of tomatoes needs in 1975 to receive 5p per lb. more for his tomatoes than he did last year simply to cover his extra costs? If he receives that extra 5p per lb., it will be bad for the housewife, and if, as is much more likely, he does not receive it, because of subsidised imports will it not be very serious for many growers?

Mr. Strang

The hon. Gentleman must recognise that imports of oil in 1974 cost Britain over £4,000 million. That is more than four times what imports of oil cost us a couple of years previously. The hon. Gentleman cannot argue, as he did in that supplementary question, for a permanent subsidy to protect growers from the real economic facts of life.

Mr. Fell

Will the hon. Gentleman ask his right hon. Friend to have another look at this matter? We are talking about some of the very small people in the agricultural world, many of whom are in the most serious financial trouble. I hope that the right hon. Gentleman, who is a friend to most of us, will really have another look at this matter.

Mr. Strang

I am grateful for the hon. Gentleman's question because it gives me a chance to emphasise that we are anxious to do everything we can to help the glasshouse industry—short of encouraging it not to face the hard economic facts of life. That is why we have the advisory services encouraging growers to invest in energy-saving equipment and why we are doing everything possible to help this industry.

Mr. Fell

The hon. Gentleman is not doing everything.

Mr. Fernyhough

In view of the many grievances with regard to the workings of the Common Market which have been advanced by Opposition Members who represent constituencies which are mainly agricultural and horticultural, can my hon. Friend explain why they do not unanimously join us in wanting to take Britain out of the Common Market?

Mr. Strang

I accept my right hon. Friend's point to this extent. It seems to me that some hon. Members are complaining because we have taken the decision on the basis of our assessment of the British national interest quite independent of what other member States and other countries are doing.

Mr. Pym

In view of the current competitive disadvantage of British glasshouse owners, have the Government made any estimate of the damage which will be done to this sector of the industry before the new régime comes in in July? Secondly, will the Parliamentary Secretary give an asurance from the Dispatch Box today that the new régime, when it comes in, will be adequate to meet the requirements of glasshouse owners? In other words, can they look forward with hopefulness to a situation in which competition will be fair and they will be able to keep their businesses in a viable situation?

Mr. Strang

The right hon. Gentleman must distinguish between capital investment grants and operating subsidies. It really is a bit much, particularly in view of the new Tory leadership, for the right hon. Gentleman and his hon. Friends to ask for subsidies to protect the horticulture industry against the increase in the price of oil when they know perfectly well that if the alleged policy of their leader were carried out there would be no subsidies for the glasshouse industry, for fishermen or for the consumer.

Mr. Pym

Will the hon. Gentleman answer my two questions? Has he estimated the damage, and can he be confident about the new régime from July?

Mr. Strang

As far as estimating the damage is concerned, we do not believe that one can talk about damage when we are helping the industry by capital grants, by advice and by research to adapt itself to the increase in oil prices. Regarding the new régime, I think that we should wait to see whether the British people decide to stay in the Community before we consider that.

10. Mr. Hastings

asked the Minister of Agriculture, Fisheries and Food whether he will list all existing forms of aid at present available to the glasshouse industry in Common Market countries, whether by direct grant, pegged fuel prices, cheap interest rates, refunds of value added tax or in any other way.

16. Mr. Spence

asked the Minister of Agriculture, Fisheries and Food if he will quantify the benefits to EEC producers, by country, of the subsidies for gas and oil that those countries grant for glasshouse heating.

Mr. Strang

It would be impracticable to list in detail all the different forms of assistance available to glasshouse growers in EEC countries, but as far as fuel subsidies are concerned I would refer the hon. Members to the reply I gave to my hon. Friend the Member for Harlow (Mr. Newens) on 17th March. However, I have since learned that the Belgian subsidy equivalent to about 1.5p per gallon has been extended until 30th June.

Mr. Hastings

Are not all these subsidies, fuel and otherwise, linked when it comes to competition? Why is it impracticable to list all the advantages which the competitors of our growers are getting? If the hon. Gentleman will not do so, how is he in a position to make the sort of assertion that he did to his hon. Friend the Member for Harlow (Mr. Newens)? Why will he not come clean about this business and give some straight answers? Does he not realise that growers in Britain are on a seasonal occupation, particularly tomato growers, and face two alternatives: to cut production or to go out of business? In present circumstances, with our balance of payments as it is, how can it possibly advantage us to force them into such a position? Will the hon. Gentleman again address his mind to the question of degressive aid and the end of June? Will the Government support the proposal for degressive aid or not?

Mr. Strang

If the hon. Gentleman rereads his Question, I think he will understand why it would simply not be practicable to supply the comprehensive information he seeks. However, we have tried very hard to supply all the information that is available regarding the oil subsidy, and that has been incorporated in the reply to my hon. Friend. If the hon. Gentleman looks at the comparisons he will see that our industry comes out relatively favourably. For example, if he looks at the figures for Ireland he will see what growers there got last year and what they are getting in the present six-month period.

Mr. Bradford

Is the Minister aware of the special difficulties of glasshouse growers in Northern Ireland caused by the close proximity of another source of supply in the South which uses Northern Ireland as an export market? Is he aware that the Eire producers get EEC subsidies and a heating subsidy, which is not paid in Northern Ireland?

Mr. Strang

I remind the hon. Member that we were paying a subsidy between January and June last year of 6p a gallon when the Irish Republic was paying nothing. The Irish Republic started paying a subsidy in the second half of last year and it is continuing the subsidy for the current six months. That subsidy, however, is only 2p a gallon.