CALF SUBSIDIES

HC Deb 25 March 1975 vol 889 cc391-407

10 p.m.

The Minister of State for Agriculture, Fisheries and Food (Mr. Edward S. Bishop)

I beg to move, That the Calf Subsidies (United Kingdom) (Variation) Scheme 1975, a draft of which was laid before this House on 19th February, be approved. I should like to remind hon. Members of the main points of this variation scheme. The £10 increase in the calf subsidy, which this scheme will remove, was introduced last July as a temporary measure. It was designed to offset the effects of the decisions then taken that the United Kingdom guide price for beef be increased to a lesser extent than in other EEC countries and that intervention need not be applied in the United Kingdom.

Circumstances have since changed, and with the introduction of the new support arrangements for beef recently agreed in the EEC, about which my right hon. Friend made a statement in this House on 17th February, the need for this other arrangement ceased to exist. In addition, although the EEC regulation authorising the increase expired at the end of December, since negotiations on the new régime had not then been concluded the increase continued to be paid on the understanding that steps would be taken to terminate it as soon as a satisfactory outcome had been reached. Payments will, however, not cease immediately, and I would like to stress this point.

All calves born up to the day on which this scheme comes into operation and certified live will continue to be eligible for the higher rates while they meet the conditions of the scheme. The scheme will come into operation, subject to parliamentary approval, as soon as the necessary formalities of signing have been completed—in other words, within the next few days. At stage A only calves born on or after the date of operation will be affected. At stage B, for which the requirements are somewhat different, and where the increase only became payable on 16th December 1974, the final date for the higher rates will be 31st March 1976. All carcases certified up till then will receive the higher rates which will have been available for nearly 16 months. Thus the majority of calves certified this year will continue to receive the higher rates of subsidy.

I shall now refer briefly to the three minor amendments proposed to update the principal scheme. The first two concern carcases presented at stage B. The requirement that a carcase must be sold in order to be eligible is to be deleted. This was a legacy from the old Fatstock Guarantee Scheme. The second amendment will prevent calf subsidy being paid in addition to compensation, which already includes an assessment of subsidy potential on carcases of brucellosis or tuberculosis reactors or contacts when these are slaughtered by the Agricultural Departments under existing animal health legislation.

The third and final amendment concerns the presentation of live horned pedigree calves in Northern Ireland. The Northern Ireland breed societies have urged that these same animals no longer be excluded from calf subsidy when certified live. Accordingly, the Government propose to make provision in the Calf Subsidy Scheme for the existing Northern Ireland exemptions to apply.

I should like to say a final word about the financial aspects of the removal of the £10 increase which I hope will reassure some people. Although in a full year it could mean a reduction of Exchequer payments of some £34 million, in 1975–76 the immediate effect will be to reduce total payments of subsidy only by £4 million for the reasons I gave earlier. This fall will be more than offset by the firmer prices for calves and stores already evident, and the growing improvements in the fatstock market. I hope that the House will approve this scheme, which has already been debated for one-and-a-half hours about two weeks ago.

10.5 p.m.

Mr. Michael Jopling (Westmorland)

Little did any of us think on the previous occasion that this matter was debated in the House that we should find ourselves back here debating the same thing almost two weeks later. I must begin by thanking the Minister for telling us again a good many of the things that he would agree he told us on 12th March when we debated this order. But I really cannot let the matter pass. During that debate we had a situation when the Government failed to have enough of their own supporters here to back their own legislative proposals.

You will remember, Mr. Deputy Speakerx2014;I believe you were in the Chair at the time—that when the House was divided—and my party had no part in this, the decision to divide the House was taken by some other hon. Members—we were in the lamentable position that the Government failed to have enough of their own supporters here to support their own business. This does not happen very often, and I would have thought that tonight we should have had some explanation from the Minister of State of why this lamentable situation arose. I am sure he was enormously embarrassed by the fact that his own Whips were asleep on the job.

I hear muttering from the Treasury Bench, but the fact is the Government Whips went to sleep on the job and did not get sufficient of their own supporters here. I have rarely heard Whips muttering or squawking or whatever they do as they are doing tonight. Obviously, they are in something of a tizzy. I can quite understand their embarrassment at their terrible failure in their duties two weeks ago. But I would have expected that we should have some explanation or apology from the Minister of State for his hon. Friends. I know that hon. Gentlemen further down on the Treasury Bench are muzzled, but we have not had that apology.

I accept that it is quite right that the Minister should not have to get up at the Dispatch Box tonight and read out again what he read out on a previous occasion. Naturally, I would not have expected him to do so, and we are grateful to him. But there are just one or two matters about which we really must question him.

During the previous debate he attempted to answer some of our questions but there was one matter to which I referred in my speech which I regarded as of paramount importance. Some of my hon. Friends who spoke in that debate also regarded the issue of the starting date of this scheme as of paramount importance. I intended that to be the most important point in my speech on that occasion.

When the Minister of State replied he did not spend as much time as I would have thought was necessary in replying to the points that had been made from this side of the House. We are still uncertain of the date on which this provision will come into play. On the last occasion the Minister told us that the scheme would come into force on the date it was signed, but he did not tell us when the Government intended to get it signed. In the days when our side was in government, I happened to be a Lord Commissioner who got these matters to sign. It is very much a matter for the Government and for the Department when they present these instruments to the Lords Commissioners for signature.

We must ask the Minister of State tonight for a firm date. Is it his intention, if the House passes the scheme tonight, to invite the Lords Commissioners to sign it tomorrow? If that is so, it, as I have explained, would be a very bad and very wrong decision. I do not want to go over the ground again. It all appears on the record. If the instrument is signed tomorrow it will be grossly unfair to farmers in the beef-breeding industry whose strategy is based on spring calving. under the arrangements that the Minister has brought before the House over the last year. The fact is that farmers with autumn-calving herds get the benefit of two seasons at the higher rate of subsidy. If the scheme is signed tomorrow farmers with spring-calving herds will get the higher rate for only one and a half seasons. This is particularly unfair for the hill areas which I described the last time I spoke on this matter.

I therefore hope that the Minister of State will explain the Government's reasoning and explain that they understand why they are intending to cut back the amount of Government subsidy for the farmers with spring-calving herds.

Previously the Minister of State did not give details of the closing date for the scheme. He said very little, and I hope that tonight he will explain that he understands the difficulties involved and that he is aware that the National Farmers' Union and other organisations are very keen that the operating date of the scheme should be delayed until 1st June at the very least. It would be wrong if the scheme were to operate from tomorrow. It would be most unfair for the people I and the Minister represent.

On the previous occasion I said that I was not able to advise my hon. Friends to vote against the scheme, and I say the same thing again tonight. I hope that the Minister will now deal in much greater depth with his reasons for bringing the scheme in immediately, if that is his plan, and I hope that he will agree to delay the operating date until 1st June if possible.

10.13 p.m.

Mr. Wm. Ross (Londonderry)

I am glad to have another opportunity to speak about the calf subsidy. I am delighted to see that the Government have decided to extend the period of the higher rate by 11 or 12 days. It is apparently now being said that my party and I were totally responsible for this, but there was a certain amount of incitement from the major Opposition party. Perhaps we did not require much incitement, but incitement there certainly was.

We were told that the drop in the subsidy payable in the year 1975–76 will be only £4 million. I take it that that applies until April 1976 and that the loss to the farming community for 1976–77 will be £34 million. If the figure for the first year is £4 million, that means that the £10 subsidy will not be paid on only 400,000 calves. I should like to know precisely how the figure of £4 million is being arrived at, because we are now in the middle of the spring-calving period. The calves which are being punched now and in the autumn are apparently the only calves on which the extra £10 subsidy will be paid. The 40,000 calves on which subsidy will not be paid will presumably be born between 13th March and about the end of June. Is that so? That is a reasonable question, because we are now at the peak of the spring-calving period and in the last 12 days a lot more calves will have come into the scheme. Will the Minister say how much this represents in payment to the farming community?

The Minister also said on the last occasion when replying to the debate on this matter that the Government did not intend to end this scheme suddenly. But in actual fact it will end suddenly; it is just the fact that it will take some time for the results to show. There is no tapering arrangement whatsoever.

A further point I should like to make is that the Government seem always to tie calf production and beef production together as if it were the same people who were going to receive the benefit of the various subsidies. That is not so. We are talking about two completely different classes of farm production, two completely different sets of farmers.

I should like to raise once more the question of pedigree heifer calves in Northern Ireland. I am the first to welcome this concession but I should like to ask whether only those pedigree calves which have been born after the date on which this scheme comes into operation will qualify, or whether the calves at present being punched will qualify for the extra £10. Also, is there to be any possibility of seeing the scheme extended to the Charolais and Hereford breeds, because there are other pedigree breeders and other calves of dual-purpose breeds which I believe should get this extra money as well and should be allowed to qualify with their horns attached?

The rate of subsidy is a matter which I have had a brief look at this afternoon. I find that when the calf subsidy scheme was first introduced in 1952 it was at the rate of £5 for steer calves and £2 for heifers. If we take £1 at the value it was in 1952 and compare it with the pound of today we find that today that same pound is worth only 34p, so there is a very large net drop in the value of the subsidy to the farming community. I wonder whether the Minister has taken this into account.

I would also ask the Minister whether he has had his attention drawn to the letter from the Northern Ireland Meat Exporters Association as to the difficulties that are being encountered with the end product of calves—I refer to beef. It would appear that a very large number of these cattle are being exported to the Republic of Ireland, and the allegation is made that, in fact, the fixed premiums and the variable premiums are paid on the live cattle in Northern Ireland, the cattle are then smuggled out of the country to the Republic, and the premiums are paid on the dead weight again, on the same cattle. I should like to ask the hon. Member if that is so and what steps are being taken to correct the situation.

Furthermore, I should like to ask the Minister if there is any record of smuggling of calves from the Republic into Northern Ireland. Do we have a situation in which there are certain areas in Northern Ireland where many of the cows seem to have twin and triplet calves on which subsidy is paid? This is a very serious matter and one which seems to be lost sight of very often, because owing to this smuggling business there has been a loss in Northern Ireland ancillary industry of some 355 jobs in the last few months and a loss of 184,000 pigs. This is not only a condemnation of the Government's security policy but a condemnation of the ability of the Department of Agriculture to keep track of what is going on in the country. I should certainly like to raise the matter here, which is the first opportunity I have had, and try to find out whether, in fact, the smuggling which exists in either pigs or beef cattle extends to calves.

Mr. Deputy Speaker (Mr. George Thomas)

I am afraid the hon. Gentleman has gone across the border himself.

10.20 p.m.

Mr. Geraint Howells (Cardigan)

I first thank the Leader of the House for allowing us three hours of valuable parliamentary time to discuss the Calf Subsidies Scheme. Last year the Welsh Grand Committee had only two-and-a-half hours in which to debate agriculture. So things are on the up and up for the agricultural industry.

I will not repeat what I said a fortnight ago when the motion was last discussed at length in the Chamber and when I had the privilege to speak. The Government failed to get the motion approved because only 15 Government supporters were in the Chamber, but I am sure that they will do much better tonight.

I declare an interest as I did on the last occasion, in that I rear Welsh Black cattle on my farm. Today I received a letter from Mr. Evan Lewis, the General Secretary of the Farmers' Union of Wales, from which I will quote two short paragraphs: Since it is possible that the scheme will come up for further debate next Tuesday when a commencement date will be set, could you do everything possible to have that commencement date set after spring calvings are over? It would be ridiculous for the scheme to come into effect in the middle of the spring calving season. I agree with the sentiments expressed in that letter, and I hope that the Minister will take heed of what other union members in Wales have to say.

I ask the Minister to answer two or three questions on the calf subsidies which are burning issues. Are we bound by the EEC regulations to accept a reduction of £10 per head for every calf reared in this country? Secondly, are we bound by the EEC regulations during the next year or two to do away with the calf subsidy scheme that has been operating in Britain since 1952? Thirdly, why were the Government in favour of increasing the calf subsidy by £10 a head last year, when within nine months we are considering a motion to revert to the crisis period of 1974 when farmers, particularly livestock farmers, suffered financial loss through the Government's lack of foresight? I wonder for how long the stop-go policy will continue and whether it will change if we decide to stay in the Community.

During the debate on 12th March I asked the Minister to clarify a certain matter, but unfortunately he did not. A Friesian breeder when presenting a Friesian heifer at a livestock auction sale does not qualify for the Government subsidy, although he is entitled to the intervention variable premium, and after slaughter the same beast will not qualify for the calf subsidy. On the other hand, if the same producer decides to send a similar type of heifer to the slaughterhouse and present the beast for calf subsidy and the fatstock variable premium he will, rightly, qualify for both. I ask the Minister to clarify why this discrepancy has been allowed to drag on from one year to another since 1952.

I have decided, in conjunction with my colleagues on the Liberal bench, to vote against the motion because I believe that the livestock sector of the agricultural industry will not tolerate a policy which results in farmers being unable to plan ahead because of the Government's lack of understanding of the problem, and creates financial worries among hill and lowland farmers who depend on the calf subsidy for part of their gross profit and for their livelihood.

On the one hand the Government are trying to encourage beef production and on the other they are doing away with some of the most important subsidies in the agricultural industry. I cannot see how the Government can justify a cut in a subsidy of such importance to the livestock sector. Perhaps we shall know later whether it is a directive from the EEC. The agricultural crisis of 1974 must not he repeated this year. If it is repeated, food production will fall and our food import bill will increase. That will happen at a time when we can ill-afford to pay any more.

10.26 p.m.

Mr. Bishop

As the House knows, we debated this scheme for one and a half hours two weeks ago. I am sure that we are all grateful to have another opportunity to debate it tonight.

The point made by the hon. Member for Westmorland (Mr. Jopling) was raised not only two weeks ago but by several hon. Members tonight. I must remind the House once again that until 30th June of last year the maximum rates for calf subsidies were £8.50 for a male animal and £6.50 for a female. As from 1st July the Government increased the maximum rates by £10. That is the item that we are now discussing.

Another point I should make is that the subsidy was accepted as a temporary measure due to the circumstances which faced the industry at that time. It was linked with the United Kingdom guide price for beef. That price was increased by a lesser extent in the United Kingdom than in any other member State. That was because the Government did not wish to apply intervention.

The hon. Member for Westmorland said that the reduction should be delayed so as to allow spring-born calves to get the benefit of the higher rates. As I have said, the increase in subsidy was introduced last year as a temporary measure in conditions which no longer apply. Whatever the effective date, some calves will be born on the wrong side of the change. No matter how long the subsidy continues, some calves will not qualify. Calves born up to the date on which the scheme is changed will continue to receive the higher rate of subsidy as they become eligible. What matters is the support system operating when the calves are certified rather than when they are born. The first calves receiving the lower rate will be less than eight months old when certified next November, but by the time the spring calves reach certifiable age their owners will be benefiting from the new beef régime which was introduced by my right hon. Friend following his statement in the House in February. That is a very important factor, as is shown by the market prices obtaining today.

Mr. Jopling

Does not the Minister realise that, although he is right in saying that some of the calves will qualify, the difficulty is that the starting point will come right in the middle of the spring-calving season? As I think I said two weeks ago, there will be a great temptation for some farmers—I agree that it will be wrong—to pretend that calves born after the starting date were, in fact, born before that date. Naturally, that will give rise to disputes. If the Minister were to agree to try to find a starting date after the bulk of the spring calving was over far less trouble would be caused.

Mr. Bishop

We should look at the position the other way round. The present Government increased the subsidy by £10 last year, more than doubling the amount. Therefore, the industry has had the benefit of that situation for that period of time. The whole point of the undertaking given by my right hon. Friend at the Council of Ministers in January was that as soon as the new régime came into effect the increase in subsidy would be phased out. The Community regulation authorising subsidy expired at the end of December. When it was introduced it was envisaged that a new beef régime would be operative by the end of the year. We were able to continue payment at the higher rate, however, during the extended period of negotiation of the new régime, and many producers have benefited from this, but those circumstances no longer apply.

In regard to the question as to when the scheme will come into operation, the fact is that no actual date of operation for the reduction at stage A can be specified in the scheme. This is the result of a technicality. The scheme cannot come into operation until it has been approved by both Houses of Parliament. I understand that it has been approved by the other place, but it has yet to be signed by the appropriate Ministers. Under the parent legislation, rates cannot be reduced for calves born before the scheme reducing those rates comes into operation. Therefore, the actual date of operation cannot be specified in the scheme until the due processes have been completed. In practice instruments come into operation a matter of days after approval in the House.

I turn to the point raised by the hon. Member for Westmorland about the promise to the EEC to terminate by a specified date. The point is that the regulation authorising us to pay the increase expired in December and we continued to pay the higher rates on the understanding that we would terminate them when the new régime came into effect.

I noticed that in the debate on this subject on 12th March the hon. Member for Westmorland said in an intervention I very much hope that the scheme AM not be signed until, at the earliest, 1st April."— [Official Report, 12th March 1975; Vol. 888, c. 736.] As a result of circumstances, the industry has had the benefit of the increased subsidy for that period and we are within four days of 1st April. The cost of the increase in subsidy is about £100,000 per day. We are now in a situation where we must carry out our undertaking to Brussels to phase out this increase in subsidy.

Mr. Geraint Howells

Does the Minister agree that the calf subsidy was higher 10 years ago than it is today and that the cost of production has increased by 100 per cent. in the past 10 years?

Mr. Bishop

I do not think that point is relevant to this discussion. The point I was making—and I was not wishing to make a party point—was that when the Conservatives were in power the maximum rates of calf subsidy were £8.50 on a male animal and £6.50 on a female. We are reverting to that, the industry having had the benefit of the £10 a head increase in subsidy. The subsidy will still be paid for a considerable period yet. The final date for the higher rates will be 31st March 1976.

Mr. Jopling

The Minister quoted what I said on 12th March when I was trying to give some sort of let-out to the Minister and asking whether the scheme could be delayed being signed until at least 1st April. However, that was not my first bid, so to speak. I also made the point in that same intervention. referring to 1st April: Many of us regard that date as totally wrong and believe that it should be extended until 1st June."—[Official Report, 12th March 1975 Vol. 888, c. 736.] I believe strongly that it should be delayed until 1st June, but I suggested at least 1st April to give a little more leeway to the industry. I should be grateful if the Minister would respond to that suggestion.

Mr. Bishop

In fairness to the hon. Gentleman, I accept what he says. I did not want to distort his remarks. When he said that he hoped the date would be at least until 1st April, I reminded the House that we are only a few days away from that date. When he mentions the date 1st June, it may be that other hon. Gentlemen will want the period to be extended even beyond that date. The point is that the market is beginning to firm up, and that prices obtained for live cattle have risen by around £3 a live cwt., as forecast by my right hon. Friend in his announcement about the new beef régime earlier in the year.

Let me turn to the point raised by the hon. Member for Londonderry (Mr. Ross) about calf smuggling. Special steps are taken by the Northern Ireland Agriculture Department, which employs over 100 people, to enforce the subsidy and to watch for irregularities due to smuggling.

The Public Accounts Committee has recently gone into the matter in detail with the Ministry and accepted the explanation of the efforts made to avoid calves from Southern Ireland receiving the subsidy. I assure the House that we are keeping the matter under review in company with the Agriculture Ministers concerned in the Northern Ireland Office.

Regarding the £4 million and how it was arrived at, I should point out that the increase in subsidy is being continued for about another year before being phased out. In that period the amount payable will be reduced by about £4 million.

Only pedigree calves born after the order operates will be exempted from de-horning in Northern Ireland. Only the Hereford and Charolais heifers are specified in the de-horning exemption. However, I shall be pleased to write to the hon. Member for Westmorland on this matter in due course.

What matters is not whether we have the extra £10 calf subsidy which the Government brought in last year, but whether the industry is getting the higher prices which therefore make the extra subsidy unnecessary. Looking at market prices day by day, the evidence is that the market is firming up and that new confidence is returning to the industry. Nevertheless, the industry has the benefit of the subsidy until April 1976. I am sure that it must be grateful for the help that has been given by my right hon. Friend.

10.37 p.m.

Mr. Stephen Ross (Isle of Wight)

I should like to take up some of the points referred to by the Minister.

First, I must declare my interest as a farmer.

I feel that we must put on record a correction to some of the remarks made by the Minister in winding up. Many people in farming have had a very hard, wet winter. I wish that the cattle prices were firming up, as the Minister claimed. This is not the time to withdraw or reduce subsidies. The country will suffer in the lone run because the meat will not be available.

The Minister referred to the market hardening up. The fact is that good quality Hereford calves might make £25 apiece at this time, whereas 12 to 18 months ago they were fetching at least £60. Therefore, there is hardly a hardening up of the market.

The majority of those who have spring-calving beef herds have only just started to calve and there have been many losses. I have checked with many people engaged in breeding. Because of the wet winter and the high cost of fodder, cattle have not been fed on normal rations. In consequence, many have been calving in a poor state and calves have been dying in large numbers. Also, substantial numbers of the beef herd have already died from magnesium deficiency. Because of cake costs, farmers have not been able to provide their cattle with the right sort of ration. That has been tragic. I know one farmer who has lost 13 cows in the last two weeks. Similar losses have been experienced by those engaged in lambing. calf subsidy. If the date were moved

This is the wrong time to reduce the to 1st June it would be of great help to farmers such as myself. It would be helpful for us to know that, once the spring calving was over, this year's births would be included. It is nonsense to say that the trade has improved and that, therefore, the subsidy is not needed.

I wintered a large number of last year's yearlings, which I hope to market in a month. I am told that I shall be lucky to receive £50 apiece for them. With the £18 steer subsidy, the total will be £68. A year or two ago the figure would have been over £100 apiece.

This is no time to withdraw the subsidy. At this time the Government should support those farmers who have hung on, hoping for better times. The subsidy is to be removed and farmers are to receive nothing in its place. For a long time EEC farmers have benefited from loans at reduced rates of interest through land banks. These are not available to the livestock farmers in the United Kingdom. An undertaking was given when the beef régime was introduced that some of these other facilities would be made available to our farmers. At a time when interest rates are so high it is wrong to strike this blow at agriculture. I hope that there will be a change of opinion and that this measure will be delayed until 1st June. That would be a move in the right direction.

Mr. Bishop rose—

10.42 p.m.

Mr. Emlyn Hooson (Montgomery)

The Minister is extending this debate because he has not dealt with some of the questions asked.

My hon. Friend the Member for Cardigan (Mr. Howells) asked three important questions which are disturbing farmers. There is a strange anomaly whereby a Friesian heifer does not attract calf subsidy. If the heifer is fattened and passed to auction it attracts the fatstock guarantee but not the calf subsidy. If the same animal is delivered directly to a slaughterhouse and sold on the hoof, it attracts the fatstock guarantee and the calf subsidy. Surely the Minister can deal with the matter. Either he knows or he does not know. If he does not know the answer, he should say so. This matter is disturbing farmers and it deserves an answer. It is not every day that we discuss these matters.

The Minister has not answered the second question. Did the Minister make an agreement with the EEC Ministers that the calf subsidy should be reduced by £10? Is that the reason why the spring calves are excluded this year?

Is the EEC against an extension of the calf subsidy system? Will that system be phased out in the next year or so?

The Minister, who has special responsibility for agriculture, is engaged in these matters every day. The agricultural industry will be greatly obliged to hear answers to those questions.

10.44 p.m.

Mr. Bishop

In reply to the question of the hon. Member for the Isle of Wight (Mr. Ross), there is evidence of a strengthening of the market. I draw the hon. Gentleman's attention to the price on 10th March—

Mr. Cyril Smith (Rochdale)

On a point of order, Mr. Deputy Speaker. Is it in order for the Deputy Chief Whip to keep remonstrating with hon. Members opposite for exercising their rights under the Standing Orders to address the House within the time allowed for the debate?

Mr. Deputy Speaker (Mr. Oscar Murton)

That is not a matter for the Chair. I have not noticed any such movement.

Mr. Walter Harrison (Treasurer of Her Majesty's Household)

It could be that the Deputy Chief Whip was just making complementary remarks about hon. Members opposite. The convivial relationship that I have with the hon. Members opposite will convince them that that is so.

Mr. Bishop

I was drawing attention to the fact that the price for all clean cattle in the week commencing 10th March 1974 was £21.49 and the total returns for certified cattle show a payment of £23.17 per live hundredweight. My right hon. Friend said on 17th February that in the agricultural prices for the current year his aim would be to provide a full return for producers of between £22 and £23 per live hundredweight.

There is real evidence of firming up of the price. That is the justification for the steps being taken this evening. In answer to the hon. and learned Member for Montgomery (Mr. Hooson), the dairy heifer may go into the dairy herd, so we then have to wait until it is slaughtered for beef. That is the only way in which we know whether it comes under stage A or stage B.

As to whether we are under any obligation to make this change, until July last year the subsidy was £8.50 for male heifers and £6.50 for female. This was raised by £10 a year as a temporary measure. On 21st January this year the Council of Ministers agreed that the United Kingdom should continue its variable premium scheme until the new EEC beef régime took effect. The Minister said that in expectation of satisfactory adjustments to the beef régime this year he was prepared to discontinue the special supplement of £10 per annum as soon as the necessary legislative provision could be made. During the meeting between 10th and 12th February, when the new beef régime was settled, he confirmed that the £10 would be discontinued and information was included in his statement in the House on 17th February. I believe that all hon. Members welcomed the package at that time, as did the industry. It showed that we recognised our obligation to phase out the increase in subsidy. That is the real point of the debate.

Question put:—

The House divided: Ayes 71, Noes. 11.

Division No. 160.]	AYES	[10.49 p.m.
Armstrong, Ernest	Canavan, Dennis	Cox, Thomas (Tooting)
Bagier, Gordon A. T.	Carmichael, Neil	Craigen, J. M. (Maryhill)
Bishop, E. S.	Cocks, Michael (Bristol S)	Cryer, Bob
Brown, Hugh D. (Provan)	Coleman, Donald	Cunningham, Dr J. (Whiteh)
Buchanan, Richard	Concannon, J. D.	Dormand, J. D.
Duffy, A. E. P.	Leadbitter, Ted	Small, William
Dunn, James A.	Lewis, Ron (Carlisle)	Snape, Peter
Eadie, Alex	Lyon, Alexander (York)	Stewart, Rt Hon M (Fulham)
Edge, Geoff	Lyons, Edward (Bradford W)	Strang, Gavin
Ellis, John (Brigg & Scun)	McElhone, Frank	Taylor, Mrs Ann (Bolton W)
Ewing, Harry (Stirling)	McMillan, Tom (Glasgow C)	Thomas, Ron (Bristol NW)
Flannery, Martin	McNamara, Kevin	Thorne, Stan (Preston South)
Ford, Ben	Marshall, Dr Edmund (Goole)	Tierney, Sydney
Golding, John	Mawby, Ray	Tinn, James
Grant, George (Morpeth)	Mellish, Rt Hon Robert	Urwin, T. W.
Hamilton, James (Bothwell)	Morris, Charles R. (Openshaw)	Wainwright, Edwin (Dearne V)
Harper, Joseph	Newens, Stanley	Ward, Michael
Harrison, Walter (Wakefield)	Oakes, Gordon	White, Frank R. (Bury)
Hughes, Mark (Durham)	Owen, Dr David	Whitlock, William
Jackson, Miss Margaret (Lincoln)	Palmer, Arthur	Wise, Mrs Audrey
Janner, Greville	Prescott, John	Woodall, Alec
Jeger, Mrs Lena	Roderick, Caerwyn
John, Brynmor	Rooker, J. W.	TELLERS FOR THE AYES:
Lambie, David	Sillars, James	Miss Betty Boothroyd and
Lamond, James	Skinner, Dennis	Mr. David Stoddart.
NOES
Bain, Mrs Margaret	Penhaligon, David
Beith, A. J.	Ross, Stephen (Isle of Wight)	TELLERS FOR THE NOES:
Hooson, Emlyn	Stewart, Donald (Western Isles)	Mr. David Steel and
Howells, Geraint (Cardigan)	Thorpe, Rt Hon Jeremy (N Devon)	Mr. Cyril Smith.
Kilfedder, James	Wigley, Dafydd
Maxwell-Hyslop, Robin

Question accordingly agreed to.

Resolved, That the Calf Subsidies (United Kingdom) (Variation) Scheme 1975, a draft of which was laid before this House on 19th February, be approved.