HC Deb 07 May 1980 vol 984 cc489-98

Motion made, and Question proposed. That this House do now adjourn.—[Mr. Le Marchant.]

1.25 am
Mr. Tom Pendry (Stalybridge and Hyde)

Even at this wee hour, I am grateful for the opportunity of raising the subject of the Northern Ireland Agricultural Trust and in particular the Government's intention to terminate it. I fully recognise that the Under-Secretary responsible for the decision to close the Trust has responsibilities in government other than agricultural matters and that he is currently abroad, no doubt doing valuable business for the economy of Northern Ireland. Indeed, he was courteous enough to contact me to express his regrets at not being in his place on the Front Bench tonight. But I am afraid that much of what I have to say bears upon him directly, and his decision to phase out the Trust, which I think was the worst decision which he has made since taking office.

I say that with a sad heart, because I believe the hon. Gentleman to be a good Minister, obviously not quite as good as his immediate predecessor, but nevertheless a good one. It saddens me to think that he arrived at his conclusion to terminate the activities of the Trust without giving a great deal of thought to it. I welcome the fact that the Under-Secretary—the hon. Member for Becken-ham (Mr. Goodhart)—has taken his place, but I hope that I shall receive more than blanket responses to the points I wish to make, and the points which the hon. Member for Down, North (Mr. Kilfedder) will make if he succeeds in catching the eye of the Chair.

Agriculture is the most important industry in Northern Ireland, contributing 6 per cent. of the gross domestic product and employing nearly 14 per cent. of its work force. Already the farmer in Northern Ireland has suffered greatly from EEC policies which, among other things, fail to recognise the unique nature of the Northern Ireland economy. These policies have resulted in a narrow margin of profit, which has inhibited the introduction of new ideas and technology there. Thus, for the most part, Northern Ireland has remained a traditional, agrarian area in a world of modern food processing and marketing industries.

As the Under-Secretary himself has pointed out on a number of occasions, the key to modern agriculture is marketing. It is, Therefore, surely ironic, and not a little sad, that at a time when every other major country is increasing its public expenditure in marketing industries, such as the recent 40 per cent. increase by the Republic of Ireland, which increased its support to about £8 million, the Government have decided to abolish a Trust which has been allocated only £413,000. That is a major blow to the agricultural community in Northern Ireland and a piece of blind stupidity, characteristic of the Government's draconian public expenditure cuts. It is evident that this was done with little thought. The Minister of Agriculture, Fisheries and Food did not examine the Trust, nor did his marketing team visit Northern Ireland to take a look at its activities and neither did Sir Robert Kidd, in his investigation of quangos.

Instead, the review was carried out by the Department of Agriculture in Northern Ireland, which has publicly admitted that no one on its staff has marketing skills comparable with those of the Trust.

I note that on 16 February, the Under-Secretary of State assured the SDLP that marketing, development and research functions previously dealt with by the Trust would be strengthened by the Department of Agriculture, Fisheries and Food. How could that be said with any confidence? Only a few days later, on 29 February, a senior civil servant at the Department—who is most competent to comment—stated that the Department had no one on its staff with comparable marketing skills. He said that neither he nor the Department had any intention of recruiting those skills.

In addition, the organisations that are expected to assume the Trust's responsibilities are not geared for large-scale marketing operations. Specifically, the Central Council for Agricultural and Horticultural Co-operation is still a probationary body, and has only one Northern Ireland representative. The Ulster Office is rumoured to be the next target for the axe. I hope that the Minister will assure us to the contrary. That office performs a valuable service, which is complementary to the Trust's work. The British Food Export Council has stated that it will become increasingly difficult to work on behalf of Northern Ireland without the confidence and co-operation which were the trade marks of the Trust. That became evident last week when the Trust held a marketing exhibition in London. I am told that 15 of the largest buyers in Great Britain participated, and that it was the best trade function that they had attended in the past two years.

Despite the adverse conditions facing any business venture in Northern Ireland, the Trust has had an impressive record. In its most recent report, the Trust listed 14 production projects, six processing projects and widespread success at marketing exhibitions in London, Paris and Germany. Recently, one operation in Bahrain secured over £500,000 in exports. Considering that agriculture is Northern Ireland's most important industry, with 75 per cent., or £300 million out of £400 million, of output attributable to exports, how can Northern Ireland not afford to have the Agricultural Trust?

It is clear that the recent success in Bahrain has more than paid for the Trust's existence. From my brief experience as a Minister with responsibility for agriculture in Northern Ireland, I believe that the Trust has done more for agriculture in the past 12 years than any other body. The small savings resulting from the decision will be out of all proportion, and will have a devastating effect on agriculture and the development of a modern food processing and marketing industry in Northern Ireland.

The abolition of the Trust will also have an adverse effect on future job development in Northern Ireland. The agricultural sector is already over-dependent upon commodity trading. That dependency is exporting thousands of processing, packaging and marketing jobs elsewhere. Currently, the Trust has six processing projects in operation. It was committed to increasing the number of projects until most of the processing of indigenous goods was being done in Northern Ireland. With unemployment in Northern Ireland at about 12 per cent., why are the Government willing to export desperately needed jobs?

It is evident that the Under-Secretary of State is concerned more about adhering to the economic dogmas of the Prime Minister than about the future well-being of agriculture in Northern Ireland. The Minister contradicts his longstanding commitment to marketing. Only last October, when awarding the Gosford prize at Dundonald House, he reiterated his commitment to agricultural marketing. He said: I believe that the deciding factor between profit and loss is not the disadvantages in production costs but rather what returns organizations can achieve from the market. If that is accepted then the battle to maintain the agricultural sector at or near present levels will be won or lost in marketing. So I would exhort everyone involved to press for an even greater effort in agriculture particularly a more positive approach to marketing. However, given the actions of the Under-Secretary of State since he made that speech, that goal is unlikely to be achieved. But I believe that, had there been a thorough investigation, the Government would not have decided to terminate the Trust; nor would the Minister have had to contradict himself publicly.

I ask, in the wee hours of the morning, that the Minister responsible for agriculture should stand by his pledge made on 26 September, when, speaking to a delegation from the Irish Congress of Trade Unions, he assured it that he was conscious of the need to bear Northern Ireland interests in mind in the operation of the Central Council for Agricultural and Horticultural Co-operation and informed the group of his intention to invite that organisation to review agricultural marketing in Northern Ireland.

I ask the Minister here tonight to reflect on what I have said, to go away if necessary to consult his colleagues, and to consider, even at this late stage, appointing either the Minister of Agriculture, Fisheries and Food's marketing team or Sir Robin Kidd's committee of inquiry to look afresh at the Trust's activities and achievements before it is too late.

1.36 am
Mr. James Kilfedder (Down, North)

I wish to take part in this debate because I feel very strongly about the Northern Ireland Agricultural Trust.

The House is indebted to the hon. Member for Stalybridge and Hyde (Mr. Pendry) for raising the subject of the future of the Trust on the Adjournment. It is not just a matter of the House being indebted to him. I think that I speak for most Ulster people who are involved in agriculture in the Province when I wholeheartedly support his plea—a plea which I have made in the past to the Minister but which he has so far rejected.

I should put on record that the Trust has earned the support of elected representatives in Northern Ireland, the Association of Local Authorities and numerous councils. They feel that the Trust should be retained.

Like the hon. Member for Stalybridge and Hyde, I question the wisdom of the Government's decision to terminate the existence of the Trust and to deprive the Province of the valuable work which it performs, particularly in the realm of marketing.

The Minister has put forward the excuse that the Trust's marketing expertise is being duplicated elsewhere. That is the inference from all his statements. But that answer is not correct. If the Minister had conducted an independent investigation, he would have discovered what most of us know—certainly those of us who live and work in Northern Ireland—namely, that the other organisations involved in agriculture in Ulster had always deferred, on the marketing aspects of the industry, to the Trust.

Since agriculture is the largest industry in Ulster, I should have expected the most careful, impartial examination before a decision was taken to axe the Trust. Sadly, however, the Trust is a victim of the Government's cuts. It was a decision made by a Conservative Government looking for something to get rid of to save some money. I think that the Government are right to try to save money. Far too much money has been wasted by Governments in the past. But this is a false economy, because, as the hon. Member for Stalybridge and Hyde has pointed out—I do not intend to rehearse the facts that he has already given to the House—the Trust has brought quite a large amount of money to Northern Ireland and has given considerable financial help to food producers in the Province.

Presumably the decision was taken to abolish the Trust because it was seen by the bureaucrats as an easy sacrifice. They believed that it could be axed with the minimum of fuss. If an independent investigation had been held, the Government would have discovered that the Trust had become a model for other countries in Europe. For all I know, that might be the position elsewhere. However, it is highly respected by its European counterparts. At a conference held at the Hague in January 1979, the Dutch publicly paid tribute to the Trust. They expressed astonishment at its impressive record of achievement, given the scarce resources with which it has had to operate.

The Minister and the Government do not have to go to Europe to find confirmation of what I say and what has been said by the hon. Member for Stalybridge and Hyde. If the Minister had consulted officials in the Department of Commerce, he would have found that when that Department was setting up its marketing office it turned to the Trust for advice. The success of the Department's marketing office is due in part to the fact that it adopted an approach to marketing similar to that which was pioneered by the Trust. An impressive and recent example is the exhibition that was sponsored by the Trust in Bahrain, where orders worth half a million pounds were obtained for Northern Ireland food producers.

It is clear that the decision to abolish the Trust is one of stupid bureaucracy. It is being done because of party political dogma. It is a decision that does not take note of the special problems in Northern Ireland. It is a decision that will exacerbate unemployment in the Province, because jobs in food processing, packaging and marketing will go elsewhere. They will be lost to other countries. Let the Government remember that 75 per cent. of Ulster farmers depend upon export sales. Therefore the decision to axe the Trust will have an adverse effect not only on the agricultural community but on the entire Ulster economy.

As I have said, agriculture is the leading industry in the Province. It contributes 6 per cent. of the gross national product and employs 14 per cent. of the work force of Ulster. Amidst a world of modern food processing industries, the only hope for Ulster is to continue the marketing efforts of the Trust. This year at the annual SIAL conference Northern Ireland will have only one representative compared with the usual 15 sent by the Trust. If the Government's plan to axe the Trust is carried out, how can Northern Ireland expect to compete with the rest of Europe?

I join the hon. Member for Stalybridge and Hyde in demanding that the Government review their decision to terminate the Trust and appoint an independent inspectorate. An investigation would result in a report that urged, as I have constantly urged, that the Trust should be retained for the benefit of all those involved in agriculture and food processing in the Province.

1.45 am
The Under-Secretary of State for Northern Ireland (Mr. Philip Goodhart)

First, I wish to apologise to the hon. Member for Stalybridge and Hyde (Mr. Pendry) and the hon. Member for Down, North (Mr. Kilfedder) for the absence of my hon. Friend the Under Secretary of State—the hon. Member for Pudsey (Mr. Shaw)—who has direct ministerial responsibility for the Northern Ireland Agricultural Trust. As he told the hon. Member for Stalybridge and Hyde in his letter, he is abroad on an official mission to the Netherlands. That mission has already been postponed once, and we hope that it will lead to increased investment and employment in Northern Ireland.

Meanwhile, I join both hon. Members in the tribute they have paid to the past work of the Northern Ireland Agricultural Trust. Since it was established in 1967, it has played an important role in the swift development of the meat processing industry in Northern Ireland. At the same time it has played a leading role in pioneering the roll-on, roll-off system of shipping live cattle from Northern Ireland to Britain.

Over the years the Trust has operated on a broad front. It has done important work in flax growing and marketing, and it has taken the lead in over-transplantation in potato processing, grass drying and gravel tunnel drainage. In the last nine years it has had a role in helping to promote the marketing of agricultural produce outside Northern Ireland. In recent years some 30 per cent. of the Trust's £400,000 budget went into this part of its work.

But to some extent the Trust has been the victim of its own success. It was meant to encourage new commercial developments in agricultural production and processing, and this role has been increasingly filled by those directly involved and by other organisations. There is no doubt that a serious overlap of functions has been growing between the Trust and the main industrial organisations in Northern Ireland, such as the Department of Commerce, the Northern Ireland Development Agency, the Local Enterprise Development Unit and the principal food export agency—the British Food Export Council.

In addition there has been increased duplication of effort by the Trust and the services provided by the Department of Agriculture for Northern Ireland, the agricultural marketing boards, the Livestock Marketing Commission and, in particular, the Central Council for Agricultural and Horticultural Co-operation. whose terms of reference have recently been widened.

Much has been made in this debate of the Trust's role and effectiveness in the experience of export markets for Northern Ireland agricultural produce. It has never considered that this should be a primary function of the Trust, in view of the existence of other agencies to help food exporters—in particular, the British Food Export Council, which exists to help food manufacturers and processers in the United Kingdom to exhibit at international food fairs. Food firms in Northern Ireland can also receive advice from the Departments of Agriculture and Commerce towards continued participation in domestic and foreign promotions. The advisory services of the Department of Agriculture are there to help all sectors of agriculture. I am glad to say that they enjoy good relationships, as the hon. Member knows, with the industry.

The Government are satisfied that at farm level the more essential activities of the Trust can be absorbed by the Department of Agriculture at less cost to the taxpayer. Processing projects will be taken up to the Department of Commerce, the Northern Ireland Development Agency, and the Local Enterprise Development Unit. Marketing efforts must be the responsibility of organisations actually involved in selling, with assistance, as necessary, from the British Food Export Council and Government Departments.

I wish to assure the House that the Government carried out a detailed assessment of the work of the Trust and weighed up all the options for alternative savings in agriculture in Northern Ireland before we took what was a very difficult decision to wind up the organisation. Having made that decision, we decided in the interests of all concerned to move swiftly to ensure as speedy a rundown of Trust affairs as possible.

Mr. Pendry

Will the Minister elaborate on that point and tell the House how detailed was the investigation and who carried it out, and why it was not carried out by organisations that were well fitted to carry out such an investigation?

Mr. Goodhart

The Minister concerned was personally involved in it.

I turn now to the question of consultation, which is of substantial importance. The Ulster Farmers Union, which was the main farming body involved when the Trust was set up, was informed by my colleague, the Under-Secretary of State, personally before the announcement was made on 13 December 1979. Alas, on the marketing and the processing side, there are no similar umbrella organisations which would have made consultation a practical proposition. The Ulster Farmers Union has, with regret, accepted the reasons for the decision. Of course, it would have liked the Trust to continue if no savings had to be made, but the important point is that neither the Ulster Farmers Union nor any other body has been able to suggest an alternative saving which would be preferable for the farmers of Northern Ireland. Meanwhile, no important section of the food processing or food marketing side of the industry has expressed any undue anxiety about the winding up of the Trust.

Mr. Kilfedder

Will the Minister give way?

Mr. Goodhart

I have only two minutes left.

I wish again to place on record the Government's appreciation of the value of the work done by the Trust over the past 13 years, and of the hard work and dedication of the chairman, the appointed members and the staff. The chairman and members will continue in office to plan and supervise the winding-up arrangements. The staff who become redundant as the work is reduced during 1980 will qualify for redundancy payments in accordance with arrangements under which they were recruited and employed. Generally speaking, this will mean the local government officers scheme, which in certain cases can be better than the Civil Service scheme itself.

The Government are satisfied that the decision to wind up the Trust was a correct one, and it is part of the present Government's much wider commitment to reduce the role of government in public life, to cut public expenditure and to produce a smaller, more efficient and economic administration.

Question put and agreed to.

Adjourned accordingly at five minutes to Two o'clock.