HC Deb 01 February 1978 vol 943 cc470-84
The Minister of Agriculture, Fisheries and Food (Mr. John Silkin)

I beg leave to make a statement about meetings in Brussels of the Council of Ministers on 30th and 31st January on agriculture and fisheries, at which I represented the United Kingdom.

At the beginning of the Fisheries Council on 30th January I raised the question of the devaluation of the green pound which had been blocked by three delegations the previous day. Accordingly, the Danish President called a special meeting of the Agriculture Council for 31st January.

In the Agriculture Council the German delegation confirmed that it did not wish to make a link between the devaluation of the green pound and the fisheries negotiations. However, the German, Netherlands and Belgian delegations explained that they saw some connection between the devaluation and the negotiations on common price levels for 1978–79. I explained the United Kingdom attitude to the negotiations on farm prices in terms identical to those I have used on many occasions in this House.

Eventually it was agreed that the green pound should be devalued by 7½ per cent., according to the following timetable; for beef and pigmeat, a devaluation of 5 per cent. on 2nd February; the additional 2½ per cent. for these commodities and 7½ per cent. for milk and milk products to take effect when the Council's decision on prices and other measures for 1978–79 enters into effect; for all other commodities, the full 7½ per cent. to take effect at the beginning of the marketing year for each commodity.

I regard this as a very satisfactory outcome. It implements the decision of this House to seek a devaluation of 7½ per cent. It gives substantial immediate help to the pig and beef sectors, which need it, and it defers the adverse effects on consumers of a devaluation for as long as possible. I estimate that the saving to British consumers as a result of the Council decision, by comparison with an immediate across-the-board devaluation, amounts to some £50 million over the next six months—or about £3 on average for every family.

In the Fisheries Council agreement was reached authorising the Commission to continue negotiations with third countries on fishing opportunities for 1978.

There was less progress in discussions on the internal regime, and none of the major issues was resolved. It was clear early in the meeting that agreement on a definitive common fisheries policy would not be possible, and accordingly attention was focused on the arrangements to apply in the meantime.

The Council was unable to agree to a United Kingdom proposal that the existing standstill arrangements should be continued for a further short period. For my part, I could not agree to an alternative proposal to adopt, on a provisional basis, the Commission's latest proposals on quotas, conservation and enforcement, which would have left aside the basic issue of coastal preference and other important issues. I maintained the Government's position that the elements of the common fisheries policy need to be considered as a whole and not adopted piecemeal.

In the absence of agreement, the Community's so-called standstill arrangement lapsed at midnight last night. Other member States declared their intention to observe, for the time being, the Commission's proposal on quotas and conservation. I made clear the Government's intention to take action in accordance with agreed procedures to maintain existing conservation measures. Our right to take further appropriate unilateral conservation measures is, of course, unimpaired.

I also made clear the Government's intention to continue to work for a settlement which would meet the United Kingdom's essential requirements.

Mr. Peyton

The right hon. Gentleman will remember that he said in the House on 23rd January that he accepted the decision of the House. Why, then, did he not insist on its being carried out in full in the Council of Ministers, at least for all livestock products, as he must be aware that postponement of action on dairy products in particular is an invitation for a further large quantity of totally unwanted imports of butter?

Secondly, does not the right hon. Gentleman feel that this indicates a likelihood that when future proposals for a devaluation of green currencies are made, if they come from this country, they will be singled out for specially adverse treatment?

Lastly, is the right hon. Gentleman aware that we wholly support the stand he has taken on fisheries, although I rather regret that he did not take our advice and attend Friday's meeting in Berlin, because doing so might have avoided his being faced with a fait accompli?

Mrs. Winifred Ewing

Hypocrisy.

Mr. Peyton

The Minister spoke of the Government's right to take further action being unimpaired. Will he take an early opportunity to indicate to the House what further actions he has in mind?

Mr. Silkin

It may be for the convenience of the House if I deal first with those questions that concern fisheries. Of course I shall keep the House fully informed. I think that the right hon. Gentleman will acquit me of any desire at any time not to keep the House informed on this and all other matters.

I would have expected the whole House to be with me on the question of Friday's meeting in Berlin. It is not simply a matter of meetings being deferred for a few days. From that point of view we got to exactly the same points. It was a question of what I considered to be—I think that the whole House is with me, including, I hope, the right hon. Gentleman—an attempt to force upon the United Kingdom issues which the United Kingdom had every right to consider at its leisure. It was for that reason that I did not go to Berlin.

I turn now to the green pound questions. First, the right hon. Gentleman has it slightly wrong. The House decided, and the Government accepted, that there should be a 7½ per cent. devaluation. In the winding-up speceh from the Opposition Front Bench the Conservatives asked that that should be immediate for all commodities. I have had a look at the various motions. The right hon. Gentleman might re-read them. The Government amendment, the Conservative motion, the Liberal Early Day Motion—all of them—singled out the livestock sector and in particular beef and pig-meat. How the right hon. Gentleman thinks one benefits the beef and pigmeat sector by increasing the cereal price I do not know. Obviously, it had to be staggered.

On an objective economic basis—and that was all: the question of the cost to the consumer and the industry's need—the Commission said over and over again during the discussions that the right figure was not 7½ per cent. but 5 per cent.

Mr. Peyton

The right hon. Gentleman must try to answer my questions. He must also try to be fair. I told him last Thursday that we did not object to his phasing where cereals were concerned. What I am now asking him is this: does he not think it very undesirable to have avoided action for a matter of months on dairy products, because there will be a further large increase in imports of butter, and they are not wanted here?

Mr. Silkin

I shall try to be fair. If the right hon. Gentleman is concentrating on the dairy sector, I must tell him that that was not the sector—[Interruption.] The right hon. Gentleman mentioned the dairy sector specifically and therefore I must deal with it. The fact is that we are dealing with a sector in which output is at a record level, the highest in our history. It is not in urgent need, and it never was. It remains capable of looking after itself.

I agree that large amounts of butter will be coming into this country. That was bound to happen. There is a great deal of butter in this country at present. But we must also weigh the fact that the consumer will benefit from that, and the producer will receive his 1½ per cent. deferred devaluation from last year, to which the right hon. Gentleman did not object at all at the time. The producer will receive that on 1st April, and he will receive 7½ per cent. on 1st April or 1st May, whenever the price negotiations finish. He will receive a 9 per cent. increase in price, and I think that that is worth waiting for.

Mr. James Johnson

Is my right hon. Friend aware that his words about the Government's intention to take further appropriate unilateral conservation measures if needed ring like music in the ears of fishermen and all of those hon. Members who represent fishing constituencies? Is he further aware that if he does not go beyond that, if he does not take unilateral action on behalf of the deep sea fishing fleet to reach agreements with States such as Norway and the Soviet Union, we shall have a disaster? Does my right hon. Friend realise that this is the view of my constituents in Hull and the view on Humberside generally? We feel this way about the future of the deep sea fishing industry.

Mr. Silkin

I am grateful to my hon. Friend for his remarks. Dealing with this question of fishing in third country waters and reciprocal arrangements, particularly with Norway, it was with this in mind that I suggested, and the Council agreed, that we should allow the Commission to continue the discussions and negotiations with third countries. It is important that third countries should not be involved in our internal struggles in the Community but that the reciprocal discussions should be continued. I hope that the discussions will bear fruit very soon.

Mr. Grimond

Is the right hon. Gentleman aware that the devaluation of the green pound will certainly be welcomed by beef and pig producers, although no doubt they will look for more? Is not the situation in the fishing industry extremely serious? Is it not the case that there seems to be no progress being made and no likelihood of making progress? While we totally support the right hon. Gentleman's stand and believe that no agreement is better than a bad agreement, may we ask him to tell us whether there is any prospect of reaching an agreement? If there is not, has he any date in mind for the taking of unilateral action?

Mr. Silkin

I have already stated the position on conservation measures, and they are the most likely measures to be considered. I intend to have discussions with the industry about how it might practise self-discipline—as has happened with mackerel fishing—in the next few months in particular. It is obviously too early for the right hon. Gentleman to know this, but it is worth considering what progress has been made. If he looks at what the other eight countries have agreed to do—I hope that they will carry out that agreement among themselves—although they do not go far enough, the proposals are a considerable move towards the position of the United Kingdom. The exception is that of quotas, and even those are much larger for the United Kingdom than appeared to be the case a few months ago. I hope that the final moves will take place within a measurable time.

Sir David Renton

In view of the unsatisfactory way in which the MCAs for livestock and the linking with the green pound has worked—and things are still unsatisfactory—may I ask whether the Minister has attempted to renegotiate that method of support for livestock?

Mr. Silkin

The right hon. and learned Gentleman probably knows that for many months I have tried to renegotiate the calculations for the MCAs. Nor am I alone in doing this. France and Italy have taken the same attitude. It is time that the House fully understood the depth of vested opposition that there is on this matter from those countries who stand to gain from what I believe, and I think probably most hon. Members believe, to be a totally false method of calculation.

Mr. Torney

May I congratulate my right hon. Friend on the excellent job he has done in Brussels despite opposition from the rest of the Common Market and the Conservative Party? Can he assure the House that there are no strings attached to the agreement he has made on the green pound which would give support to the new Tory policy of higher food prices in the shops?

Mr. Silkin

In the course of the next few months the full basis of the Conservative Party's policy on dear food should be made known to the whole country. I intend to play my part in seeing that that is done. I can tell my hon. Friend that there are no strings attached to the agreement.

Mr. Peyton

I am very conscious that we shall hear a lot more of this kind of misrepresentation, at which the right hon. Gentleman is particularly skilled. Is the right hon. Gentleman aware that what I am asking, and what I have asked all along, is why he has failed to take account of the jeopardy in which he has placed the livestock industry as a result of his policies? Does he not feel that that will have a great bearing on the consumers, whom he affects to cherish?

Mr. Silkin

It was precisely to give assistance to the livestock sector—the only part of the farming industry that is in difficulties at the moment—that I suggested a 5 per cent. devaluation which, on an objective economic basis, was the figure the Commission said was correct. It thought that 7½ per cent. was overshooting the mark by quite a bit. Leaving that aside, of course there is an interest here. We do not want to see our market taken over by imported foods.

Mr. Wiggin

We shall remember that.

Mr. Silkin

I have said so on a number of occasions during our debates. What the right hon. Gentleman will have to defend throughout the country is his advocacy of an across-the-board price increase amounting to 6½p in the pound on food prices.

Mr. Watt

May I ask the right hon. Gentleman to accept the congratulations of all hon. Members on the nationalist Bench on the excellent stand he has taken in Brussels? Dealing with the fishing issue, may I ask him now to take the one step which the EEC is terrified to take—to extend limits unilaterally to 50 miles so that at least we shall have some fish left for another year? Turning to the green pound, may I ask the right hon. Gentleman to see to it that the hard-pressed hill farmers are paid the extra money that is due to them in March?

Mr. Silkin

I will certainly see that all arrangements for the hill farmers are made as speedily and as efficiently as possible. Turning to the fisheries question, I have said, and I repeat it now, that it is an essential requirement of the United Kingdom that we have a coastal preference. We have discussed how to define that. The meaning is very much the same, whatever we may talk about. It is essential that we keep this preference.

Mr. Jay

In view of the seriousness of the fishing situation, will my right hon. Friend note that there is a simple way in which this country—like Norway—could obtain a 200-mile exclusive zone, and that is by withdrawing altogether from the EEC?

Mr. Silkin

I should like to agree that it was a simpler way, but the fact is that even Norway has to negotiate with other people. I must admit that, were we by ourselves, this process of negotiation would be simpler. But we are not alone.

Mr. Wiggin

Is this not the first occasion on which any country seeking to revalue its green pound has had to have a serious negotiation about the issue? Can the right hon. Gentleman say why this matter took more than a week and can he further say whether his previous negotiating approach might have had something to do with the hostile response he received?

Mr. Silkin

If my previous negotiating policy had something to do with it, the end result, as far as I am concerned, confirmed that negotiating policy. We got a result which I think was better than that for which I had originally asked a week earlier. Whatever reasons the other countries had for taking the attitude which they took must be matters for them to consider. I have tried to explain to the House the reasons that were given.

Mr. McNamara

Is my right hon. Friend aware that he is to be congratulated on the number of jobs he has saved in the fishing industry by his action over the past few days? Can he tell the House whether he thinks the present situation does not provide a wonderful opportunity for demonstrating to Europe how fish can be conserved by limitation of effort and appropriate quotas? Will he bring before the House some positive recommendations for a 50-miles exclusive zone within our own waters?

Mr. Silkin

I think that the next few days require me to take very urgent consideration of all the factors that need to be taken into account. I agree that this may well be a moment for meeting a challenge—I do not mean a physical challenge, but an intellectual challenge—to show how we as a country can properly organise, as a coastal State, a real fisheries policy.

Mr. Wall

Will the right hon. Gentleman confirm that British legislation will be used to impose conservation measures up to a 200-mile limit? In that case, will he consider effort quotas, mesh size, restriction to one type of net for every vessel, and control of industrial fishing?

Mr. Silkin

The immediate problem is to see that those conservation measures, whether on a Community or a national basis, which were in existence before are maintained. I agree with the hon. Gentleman that I shall then have to do an awful lot of looking to see what ought to be done thereafter.

Mrs. Dunwoody

Is my right hon. Friend aware that it is refreshing to see British Ministers negotiating with a ruthlessness normally demonstrated only by other Common Market Ministers? Will he go on to ensure that there is no price rise in the price review over and above an absolute minimum figure of 1 per cent., because a rise beyond that would be utterly intolerable to the consumers in the Common Market and add to the extraordinary mountains that we already have?

Mr. Silkin

I thank my hon. Friend. The Government's view of the price negotiations, particularly of the prices of commodities in structural surplus, is well known and hardly needs repeating. Having said that, perhaps I should repeat it. Our view is that, where commodities are in structural surplus, they are in structural surplus because of the end price, and it is that that needs dealing with.

Mr. Buchanan-Smith

Is the right hon. Gentleman aware that his insistence on treating all fisheries issues as a whole will be widely welcomed and that as long as he continues his insistence he will be supported throughout the fishing industry? Can he be more forthcoming about third countries, such as Norway and the Faroes, and how our fishermen will be affected over the next few weeks? Is he satisfied that we shall be able to enforce whatever unilateral action may be necessary?

Mr. Silkin

I thank the hon. Gentleman for making that final point. My answer to it is "Yes, I am satisfied about that." On the question of negotiations with third countries, I suggested that the Commission's mandate—it has a mandate to negotiate with third countries on a total allocation basis—be continued and confirmed, and that was done. It means that the mandate to negotiate remains, but, of course, the allocation is then a matter of some dispute.

Mr. Buchan

Will my right hon. Friend accept the simple point that, apart from the petulant yelping from Yeovil, virtually the entire nation, including all the fishermen and very many farmers, will applaud the fact that for once a sturdy British voice is speaking up for it? My right hon. Friend referred to the £3 difference on the family spending as between his proposals and what was proposed by the Conservative Party in relation to the green pound. Will he make a further calculation to show how much difference there would have been under the policy propounded by the Scottish National Party of a 20-plus per cent. devaluation by the end of the year?

Mr. Silkin

If it really were the SNP's policy—I do not know, but I take what my hon. Friend has said—to ask for a 20 per cent. devaluation in the green pound by the end of the year, I suppose that in the year following there would have been about a 4p in the pound increase in food prices.

Mr. Gould

While my right hon. Friend can be assured of overwhelming support for the skill and tenacity he has shown, does he not sometimes long for the days when the British Minister of Agriculture, Fisheries and Food could take sensible decisions in the national interest without getting bogged down in the unpredictable and irrational quagmire of Community negotiations?

Mr. Silkin

If it is not already in the Library, I think that I had better place there a copy of my speech to the Farmers' Club last month.

Mr. Kilfedder

Is the right hon. Gentleman aware that the fishermen of Northern Ireland fully support his stubborn attitude to the other Common Market countries? Will he take action as quickly as possible unilaterally to stop the greed of other Common Market fishing industries in taking our fish, on which the livelihood of our fishermen and their families depends?

Mr. Silkin

I thank the hon. Gentleman, but I would say "sweetly reasonable" rather than "stubborn". What he says about unilateral action must be one of a number of factors that will need to be carefully considered in the next few days.

Mr. Austin Mitchell

My right hon. Friend is obviously assured of the congratulations of the House on the firmness of his stand against the fisheries proposals, but there is still confusion between the demands of the industry for a 50-mile exclusive zone, the initial Government proposal for a belt up to 50 miles, and the later proposal for a dominant preference area. Can my right hon. Friend confirm, therefore, that it is the Government's intention not to accept any regime which does not give us control over access and catches within 50 miles round our coast and that it is also their urgent intention to bring in national conservation measures to show just how serious we are in these negotiations?

Mr. Silkin

I think that both these matters come under our essential requirements.

Mr. Henderson

Is the right hon. Gentleman aware that his vigour and patience in these fisheries negotiations are much appreciated? But it is depressing for us to hear how he always seems to be in a position of one against the other eight in the Common Market Council of Fisheries Ministers. Will he perhaps take this opportunity of reminding the other Community countries that his patience is not limited, and nor is that of this House?

Mr. Silkin

I have a feeling that the debates in this House may well be read throughout Europe.

Several Hon. Members

rose—

Mr. Speaker

I will call those right hon. and hon. Members who have been rising throughout.

Mr. Skinner

Is my right hon. Friend aware that, since he became the responsible Minister, he has begun to sound more and more like the football manager on television with a team in the relegation zone? Does he not appreciate that it is no good playing in these foreign leagues? All the time the prices are rising, they are demanding our fish, they are drilling for oil, and our net contribution is rising to £860 million in a few years' time. It might kid some of the Marketeers that he is doing a great job, and he may be doing a great job in terms of other Ministers who go to Brussels, but it does not kid me. The only answer is to get off the European gravy train.

Mr. Silkin

A lot of my time and energy is spent in dealing with my colleagues in the Council of Ministers in Europe, and I have not enough energy left wholly to deal with my hon. Friend. But such energy as I have leads me to ask him a question which he might consider. [Interruption.] I am answering his question with a question, which is a well-known House of Commons device. In due course my hon. Friend might give me what he considers to be the answer. Does his point of view mean that a British Minister in the Council of Ministers should simply sit back and let every single thing be done against this country? Whatever may be a British Minister's view, should he not stand up for the nation?

Mr. Skinner

My right hon. Friend just should not go.

Mr. Fairbairn

In answer to my hon. Friend the Member for Weston-super- Mare (Mr. Wiggin) the Minister said that he thought that the Continental countries would have to consider their reasons for opposition to devaluation of the green pound. Will he now consider the reasons for the opposition—namely, that his policy of resisting it for so long, and therefore allowing the other countries to provide our food from their resources, has resulted in the fact that they are reluctant to lose our markets? Will he take that lesson to heart and in future not so stubbornly imagine that it is in the interests of the consumers falsely to hold down food prices for ever at the expense of our own farmers?

Mr. Silkin

I note what the Conservative Party's policy on food prices is. If the Conservative Party does not want to give it all the publicity that the hon. and learned Gentleman apparently wants to give it, I am happy to give it publicity on my own. But I point out to the hon. and learned Gentleman that, certainly in the pigmeat sector, the country that was most anxious to create a market here was the country which strongly supported the United Kingdom in the devaluation of the green pound. It was not Denmark that objected.

Mr. Ioan Evans

Will my right hon. Friend take it that there will be wide admiration for the stand which he is taking in the Common Market on behalf of British interests, especially among our food manufacturers, the National Consumer Council and the consumer organisations? But will he continue his efforts not only to try to get some sense into the green pound but to get some sense into the whole common agricultural policy, if that is at all possible?

Finally, will my right hon. Friend address his mind to the political question—namely, how he and the Government can make a decision, and the House of Commons can make a decision, but he is not powerful enough to push the Council of Ministers? Will not my right hon. Friend's position be further weakened if we have a directly elected Assembly?

Mr. Spearing

Yes.

Mr. Silkin

I think that each hon. Member must make up his own mind on that question.

Mr. Skinner

My right hon. Friend stayed outside.

Mr. Silkin

That was my way of making up my mind. On the other questions raised by my hon. Friend the Member for Aberdare (Mr. Evans), it is undoubtedly true that the common agricultural policy as at present constituted does not properly serve the interests of the people of the European Community. For that reason we advocate a radical change in it. Although there are several aspects to it, to my mind that change has as its greatest point the fight against the price levels for commodities in structural surplus.

Mr. Biffen

Will the right hon. Gentleman note that the grudging reluctance of the German Government to accept a policy in respect of the green pound devalution which had the authority of the House of Commons—the motion having been moved by my right hon. Friend the Member for Yeovil (Mr. Peyton)—will not have passed unnoticed, and it will have intensified the desire of many of us who wish the House to have greater authority in the decision-taking processes of the Community?

To that end could the right hon. Gentleman point out to his colleagues in the Community and in the German Government, in particular, that the proposition that the prospective Common Market price review should lead to further price increases for those products which are in structural surplus—cereals and milk—would make a total nonsense and would run contrary to deeply held opinion throughout the House?

Mr. Silkin

I have said to the House on several occasions, and I have said in Brussels, that one attends price review meetings to examine everything on its merits, but I have said also that I believe that the merit of having a higher price policy for commodities at present in structural surplus escapes me.

Mr. Spriggs

My right hon. Friend reported to the House this afternoon that there is a lot of butter in the Common Market countries at present. Will he take it that if the Community officials decide to sell the butter outside the Common Market, at 6p a pound, to a foreign Power again, he and his colleagues will have something to answer for when he makes his next report?

Mr. Silkin

I have often made plain the feeling which I believe to prevail throughout the House about that sort of transaction. It is ludicrous. But this question serves to re-emphasise two points. First, let us examine and tackle the question of the price of commodities in structural surplus, butter being a good example. Second, until we have got it totally in its form, was not the United Kingdom right last March and April to insist that we had a butter subsidy?