§ 1. Mr. Shepherd
asked the Minister of Agriculture, Fisheries and Food what progress has been made to reduce the structural surplus in dairy products in the EEC.
§ The Minister of State for Agriculture, Fisheries and Food (Mr. E. S. Bishop)
During the Community Price Review the price increases for milk were set at levels which, taken with the agri-monetary changes, result in no increase in prices to producers in real terms over a large part of the Community. However, owing to favourable production conditions, milk production in the Community is running at a higher level than last year. The Commission has been instructed to submit proposals aimed at bringing the market into better balance.
§ Mr. Shepherd
Does the Minister agree that the Commission has left matters rather late in view of the supply situation for milk this summer? Does he agree that there will be more skimmed milk powder than the skimmed milk powder incorporation scheme will remove from the surplus? Will he ask his right hon. Friend to support the motion of censure on this subject at the European Parliament?
§ Mr. Bishop
The Council regulations provide for the scheme of import deposits to end on 31st October and also, if a satisfactory reduction in stocks is not achieved by that date, that the period of the scheme may be extended. In regard to surpluses generally, the hon. Gentleman may know that stemming from negotiations which ended in March on the skimmed milk powder scheme, which was part of a package, the Council has asked the Commission to submit proposals, to take effect from the beginning of the 1977–78 milk year, for milk producers to contribute to the financing of any surpluses. My right hon. Friend has stressed that there should be more producer responsibility for surpluses.
§ Mr. William Hamilton
Is my hon. Friend aware that the Members who tabled that motion in the European Parliament are the same hon. Members as voted for increased agriculture prices in the Community and that it ill becomes them to challenge the Commission on a policy which they did their best to support? Will my hon. Friend note the recent report of Which? which blames the Common Market for excessive food prices being paid by consumers in this country? Does he recognise that, whether we on this side are pro-or anti-Europe, we are very much opposed to a policy which makes that imposition on consumers?
§ Mr. Bishop
I take note of what my hon. Friend says. He and other hon. Members will appreciate that surpluses are not a feature of the Community alone. New Zealand, Australia and other places have the same problem. What matters is food supply security, and that is the basis of our policy.
§ Mr. Powell
Does the Minister understand that rigged prices always lag behind the real world and that no way of preventing this ever has been discovered or ever will be?
§ Mr. Bishop
I hope my right hon. Friend will appreciate that shortages also cost consumers a great deal. Our problem is to ensure that supply and demand are kept in balance.
§ Mr. Scott-Hopkins
Does the Minister agree that there will be a surplus of about 1.5 million tons of dried milk and that this is mainly due to the disastrous decision of himself and his colleagues not to accept the Commission's proposals to reduce this structural amount of milk production?
§ Mr. Bishop
If the hon. Gentleman is fair, he will admit that there is no logic in the fact that he and his hon. Friends 1646 applauded the package which my right hon. Friend brought back from Brussels and then started to criticise certain parts of it. If my right hon. Friend had not accepted the whole package, he would rightly have been criticised for not taking the best bargain we could have had for some time.