HC Deb 13 March 1980 vol 980 cc1547-8
15. Mr. Nicholas Baker

asked the Minister of Agriculture, Fisheries and Food what proposals he has to deal with the unfavourable position of United Kingdom farmers in relation to their EEC counterparts under the EEC non-marketing of milk premium scheme.

Mr. Buchanan-Smith

The rules governing the non-marketing and conversion premium schemes, including the rates of premium payable, are fixed by Community regulations. These do not draw any distinction between producers in different member States, and I am not aware that my Department is applying them in such a way as to put United Kingdom farmers at a relative disadvantage.

Mr. Baker

Is my hon. Friend aware that the treatment of the premia in the hands of the recipients is different for tax purposes in Britain, Denmark and the Netherlands? Is he further aware that that puts our dairy farmers who take the premia at a considerable disadvantage? Will he urgently take up the matter with his right hon. and learned Friend the Chancellor of the Exchequer so as to make possible alterations to the tax system to achieve an adjustment? Will he also agree to take measures in concert with our Common Market partners?

Mr. Buchanan-Smith

As my hon. Friend correctly said, the matter of taxation is one for my right hon. and learned Friend the Chancellor of the Exchequer. My hon. Friend must remember two things. First, there are other countries in the EEC which, for tax purposes, treat the premia in exactly the same way as we do. Secondly, I hope that he will acknowledge that in 1978 it was agreed to make these payments by annual instalments, which goes some way towards meeting the point that he makes.

Mr. Gummer

Is my hon. Friend aware that the administration of the premia is a difficult and complicated matter, and that sometimes it appears that the Ministry of Agriculture, Fisheries and Food in Britain is more strict and tougher about the exact interpretation of the rules than appears to be the case elsewhere? Is he further aware that that policy is harmful to our industry as it tries to work out the system? Will he take care to ensure that the Minister gives dairy farmers as much leeway as is humanly possible?

Mr. Buchanan-Smith

I hope that the officials in my Department endeavour to apply the rules in the fairest possible way. If my hon. Friend has evidence of unfairness in any way at all I should be happy to take up the matter.