HC Deb 16 February 1978 vol 944 cc653-4
16. Mr. Spence

asked the Minister of Agriculture, Fisheries and Food if he is satisfied with the proposals in the 1978 EEC prices review.

Mr. John Silkin

I agree with the general emphasis on the need for price restraint but I have doubts about a number of points of detail and I am not convinced of the need for any increases for products in structural surplus.

Mr. Spence

Does the right hon. Gentleman agree that the staged devaluation of the green pound in itself is leading to an increase in imports, particularly of dairy products and butter? Without wishing to join the club, or of being accused of doing so, may I ask whether he agrees that this is detrimental to the British dairy industry, and whether he can do something about it?

Mr. Silkin

I think that in the short term it is bound to lead to an increase, just as, for example, the ending of the butter subsidy might have done, and the fact that the butter subsidy is progressively to decline. In the general run, however, there is no doubt that when the green pound takes effect it will immediately be of assistance to the livestock producers, and particularly to the dairy farmers.

Mr. Gould

Does my right hon. Friend agree that green rates were introduced by the French and Germans long before we became members of the Common Market, that every other member country has a green rate, and that it is highly doubtful whether the CAP can survive without green currencies?

Mr. Silkin

I think it is right to say that the only member of the Nine that has no green rate is Denmark. I think it is also right to say—I hope that I am not traducing anybody—that the only enthusiastic supporters of the automatic seven-year elimination of the representative rates are the Danes. I detected a considerable lack of enthusiasm amongst my colleagues in the Community once they were put face to face with the real possibility of the green rates being phased out.

Mr. Marten

What representations is the Minister making to the Germans to revalue the green mark? As a member of his club, may I suggest that perhaps the Germans might be, in the hackneyed words of the Opposition Benches, "dragging their feet" on that issue?

Mr. Silkin

It is interesting to note that if one adopted the suggestion of one of my hon. Friends a moment ago, of one European unit of account equalling one agricultural unit of account, the Germans would be far and away furthest from the norm, far above us or any other country. I have pointed out in the Council that it is the higher rate of common prices dictated by the "snake" that is really causing all the structural difficulties.

Mr. Geraint Howells

Is the right hon. Gentleman in a position to say when the prices review negotiations will be finalised this year?

Mr. Silkin

I cannot say when they will be finalised, but I think that they will start to be finalised round about the first week in April. I do not want to upset the hon. Gentleman, but I believe that price negotiations have been known to go on until June.