Agricultural Marketing Bill

HC Deb 18 November 1982 vol 32 cc436-72

Order for Second Reading read.

4.37 pm

Mr. Speaker

Mr. Peter Walker.

Mr. Mark Hughes (Durham)

On a point of order, Mr. Speaker. Before the right hon. Gentleman speaks, may I draw the attention of the House to one small difficulty? A major part of the Bill deals with the repeal of parts of the Agriculture Act 1967. When I went to the Vote Office on Monday I was unable to obtain a copy of that Act, because it is out of print. Can you advise me how the House can proceed when hon. Members cannot have a copy of an essential part of the measure that we are about to consider?

Mr. Speaker

Order. I think that we had better wait to hear what the Minister has to say. He may be able to clear up the matter.

The Minister of Agriculture, Fisheries and Food (Mr. Peter Walker)

I received no request from the hon. Member for Durham (Mr. Hughes). Copies of the Act are available in the Library and in the Ministry, and I am sorry that at the last moment the hon. Gentleman has decided to raise this point as a personal difficulty. We have received no similar application from any other hon. Member, saying that he is in difficulties.

Mr. Bob Cryer (Keighley)

On a point of order, Mr. Speaker. You said that you would hear what the Minister had to say. I was not aware of the unavailability of the Act. However, it is not good enough for the Minister to say that no hon. Member has applied to his Department for information. When new primary legislation significantly affects previous primary legislation, it is necessary for the previous legislation to be available. I am struck by the contrast between the way in which the Minister treats the House in this offhand fashion and—

Mr. Speaker

Order. The hon. Member for Durham (Mr. Hughes), who raised the point of order, said that he had gone to the Vote Office on Monday. I do not know whether he has made any similar requests since then. I would not know whether the document is available.

Mr. Peter Walker

I have checked, and copies of the appropriate part of the Act have been photocopied and are available in the Vote Office.

Mr. Speaker

That settles that.

4.40 pm

Mr. Peter Walker

I beg to move, That the Bill be now read a Second time.

I hope that the Bill will be supported by both sides of the House. The proposals are welcomed by all sections of the agriculture and food industries. We have the advantage of an agriculture industry which, one can argue, in terms of productivity, production, inventiveness and innovation, compares favourably with the agricultural sector of any of our major competitors. We also have a food manufacturing industry with a world-wide reputation and a remarkable national and international record. Our retailing organisation for food compares in efficiency and effectiveness with any in the world.

The Bill has an impact on the whole food chain. It is not designed specifically for agriculture, the farmer or the horticulturist. The food manufacturing industry, processors and retailers will all be affected by the Bill's provisions.

The reason I welcome this opportunity to move the Bill's Second Reading is that over the last three and a half years that I have been responsible for the Ministry, my analysis has been that we compare favourably in production, innovation and research with our competitors. For historic reasons, however, I believe it is true that some of our competitors have been superior in their marketing performance.

This country has long been a major food importing country, whereas countries such as France, Denmark and Holland have had to export a substantial part of their food production for their national survival. They have had to become experts in marketing, not only in their domestic markets, but on a world-wide scale. In this country, with its enormous domestic market compared with our home food production, there has not been the same pressure.

I made the analysis, correctly or incorrectly, that the greatest scope for progress over the next 10 to 20 years lay in an improvement of our marketing performance. Late in 1979, or early 1980, I asked five individuals to assist the Ministry and the Government by examining the problems of marketing British agriculture and food products. To some extent, they were unique appointments. They were not appointed as a committee. They were given no terms of reference. I asked them to examine any sphere of agriculture and food marketing that they wished and told them that I would endeavour to provide any background information and to arrange any introductions to sections of the industry that they required. They were to be free to say publicly at any time what they wished on any topic. They would be able to confer privately with me about their ideas and views. They were to be five individuals with total freedom over the conduct of their inquiries and their dialogue with the British industry.

I express my gratitude to those individuals. All are busy people in their own right. Dennis Stevenson has done a great deal of public service. When I was Secretary of State for the Environment I asked him to take on the difficult task of chairman of Peterlee and Aycliffe new town. I gather from hon. Members representing Durham that they greatly admire the efforts that he applied to that task. His impact on the marketing exercise has been considerable.

Sir John Sainsbury is well known as one of our most successful food retailers. He has a major business of enormous dimension, but has nevertheless given a great deal of his time and attention to assist in the marketing task. John Cross is a distinguished farmer and well known in the agricultural co-operative movement. Detta O'Cathain, who has become a member of the staff of the Milk Marketing Board, was originally employed by one of the major private enterprise concerns in the food industry. Ann Burdus was head of one of our major advertising agencies and has recently been replaced among the advisers by Robin Wight. All those people have devoted a great deal of effort and have travelled at home and abroad to fulfil the task that I gave them. They have received no financial reward for their activities. Many results have flowed from their ideas and suggestions following the genuine dialogue that occurred with all those they met.

One of their early conclusions was that Britain was at a disadvantage compared with some foreign competitors in having no organisation that had the power of coordinating marketing efforts at home and abroad for British food products. They saw the French benefiting by the activities of SOPEXA, the Germans by the activities of CMA and the Danes and the Dutch with similar organisations, and also the Italians with their trade centres concentrating on food and wine products. They saw the gap that needed to be filled if we were to make a full impact.

A great deal of activity and change has already produced benefits for the whole economy. During the last three to four years the proportion of our domestic market taken by British temperate food products has increased to such a degree that the balance of payments this year will show a £1 billion improvement over the figure that would have resulted from retaining the old proportion of our domestic food market. On the overseas side, the volume of our exports has increased since 1979 to such a degree that I expect our exports of foodstuffs this year will be £650 million higher than three years ago. Those two factors alone mean an improvement in 1982 of £1,650 million in our balance of payments, better export penetration and a bigger share of our home market.

There has been the successful launching of Kingdom apples and a big counter-attack on what had become a diminishing market. This year there will be Charter bacon. At long last our bacon processing industry is to introduce quality control, which means that we can compete with our main competitors. In the few places where it can be obtained, there will also be a new English cheese.

A great deal is happening in other sectors of the industry. I wish to stress, however, the considerable potential that remains. This year we shall probably import £3¼ billion worth of temperate foodstuffs that we could produce ourselves. There is still a great area for successful import substitution. The other countries of the European Community import £17 billion worth a year of foodstuffs of the type that we can produce. Of that amount, only £1 billion worth comes from the United Kingdom. Of the total imports within the Community from other Community countries of foodstuffs of the type that we can produce, only 5 per cent. come from the United Kingdom.

When one realises that Denmark exports 80 per cent. of its food production, France 35 per cent., and the United Kingdom only 25 per cent., one realises the great potential. The Community as a whole exports £400 million of foodstuffs to the United States, of which only £40 million is from the United Kingdom. We know the advantages to the United Kingdom of North Sea oil, but we should always remember that the time will come— in the not-too-distant future—when that oil will run out, while British agriculture, horticulture and food manufacturers will remain a major and permanent part of our economy.

As a result of views that were expressed by my "Marketeers" and by the industry, and of the dialogue that took place, in which the NFL and the British Food Export Council played an important part, it became clear that we needed a new council. We had the important activity, which the Bill retains and provides for, of the Central Council for Agricultural and Horticultural Co-operation. Several right hon. and hon. Members who are here today will know from their constituency experience how co-operatives in horticulture and agriculture have greatly benefited from the activities of that council, and its work is to continue. Indeed, those whom I have provisionally asked to stand by to be members of the governing board of the new organisation, Food from Britain, want the central council to operate under a separate board with a separate chairman, and the £1½ million a year that is currently allocated, together with £3 million in grants, will continue under the Bill. My dedication to their activities is best expressed by the fact that I have asked the current chairman of the central council to become the chairman of Food from Britain.

I express my gratitude and thanks to Nicholas Saphir for the remarkable job that he has done for the central council and for his willingness and agreement to take on this task. He is young by the normal standard of these appointments, and he is involved in his own business career, but I know that his personal dedication, ability and knowledge of the markets are such that he has the confidence of all parts of the industry. Incidentally, when I appointed him as chairman of the central council I received a telegram from an NFU branch calling for his immediate resignation because he was not a farmer. I am pleased to say that that branch has since stated that it no longer wants his resignation, because it admires his ability and talent, and I have no doubt that he will give considerable leadership to the new organisation.

We need the new body for several reasons. First, there is nothing in this country to co-ordinate the market research that is required for major sections of the industry. Undoubtedly it will carry out research programmes. Also, there is a need to co-ordinate sales campaigns at home and abroad, and to provide appropriate publicity material. Then there is the gathering together of producers, manufacturers and processors to embark jointly on advertising campaigns in all forms of the media, and the organisation on a substantial scale of inward missions of people who are buying from overseas—retailers and purchasers from the whole world as well as from Europe.

Organisations abroad have succeeded in carrying out a range of activities. We are one of the last of the major food producer countries to get organised in this sphere. In France there is SOPEXA, with a substantial income, of which 70 per cent. comes from Government grants. The latest figures from one Government organisation show that last year the French Government put up about £9 million. The organisation in Germany was financed for the first five years by the Government, and is now financed by levies on the industry. The Danes, the Dutch and the Italians have a diversity of organisations, all of which receive Government aid and are helped to carry out their operations, many of which of course are in this country.

Mr. Robert Maclennan (Caithness and Sutherland)

Is the Minister satisfied that the extent of Government involvement in the financing of SOPEXA does not amount to national aid which is distorting intra-Community trade, particularly in horticulture?

Mr. Walker

We see the necessity of providing Government aid in all these spheres, to get the new organisation going. It could not start without an injection of Government money. The majority of the £14 million aid that I intend to give over five years will be in the early years, and my intention is that the industry will gradually take over the financing of it. Part of SOPEXA is financed by the French industry. As I said, the latest figures showed a Government grant of £9 million. The size of that grant, bearing in mind the size of the French food industry, is not so great as to make it an important or serious national aid. Clearly, if a Government were putting in hundreds of millions of pounds, thus subsidising foodstuffs, and so on, that would be against the terms of the treaty. Over the years the Commission has decided that the money put into SOPEXA by the French and the money put in for five years by the Germans has been acceptable within the treaty.

In deciding the composition of the membership of Food from Britain, I hope that the House will support me in ensuring that it is not an organisation in which any body or group of people, as of right, has a nomination on it. It would be easy to say that everyone should be represented—the NFU, the Welsh farmers union, the Northern Ireland NFU, the country landowners, and the food manufacturers. It would be a long list, including people from the Consumers Association, someone representing retailers, and so on. One would end by having a vast body of people whose main task would be to put forward their own views. I chose people purely because of their individual wisdom, ability and talents. I made it clear to bodies such as the NFU and others that they would not have nominees, as of right, in such an organisation.

I hope that the House will allow the organisation to operate on that basis and then judge it by the quality of its work. I am delighted with those whom I asked to put their names forward. Their ability, talent, wisdom and knowledge are considerable, and the discussions that I know they have already had have not been on the basis of defending their own sector, experience or vested interest, but of considering what is necessary to make the organisation a considerable success.

Mr. John Carlisle (Luton, West)

Will my right hon. Friend elucidate the position of those whom he has appointed before the Bill is enacted? How many people has he in mind at this stage to steer the Bill through the House, and for how long, after the law becomes an Act, will they be in office?

Mr. Walker

The number is 13. It will be seen from the Bill that they will have wide powers. I do not want the body to be run indirectly by civil servants in my Ministry. I want those appointed to get on with the job as best they see it, because I believe that they have the wisdom and knowledge to do that. They will have powers to co-opt for any particular work, to set up committees and to seek advice of other people. It will be a body of tolerable size and I envisage initial two or three-year appointments. On that basis, we shall have initial stability and a group of talented people to get the organisation under way.

The first thing that I wanted to ensure was that the organisation was properly financed. If it had been launched on a minute sum of money it would probably have been amateurish. I have made it clear that there will be £14 million available over five years and I expect that the bulk of that will be spent in the early years. As the work of the council gets under way it will start obtaining revenue from the industry and those who benefit from its services.

I envisage that the Government will put in most of the finance in the first year, somewhat less in the second year and much less in the third year. By the end of the five years, the organisation should be self-financing from donations and contributions from the industry. If it is a failure, the money will not be coming in from outside. The organisation will be run-down and ineffective. The manufacturing industry and the main marketing boards want it to be a success and I have no doubt that it will be. If it is, it will be able to obtain appropriate financing for future years.

The Bill establishes a central marketing organisation for agriculture and food, to be known as Food from Britain. Clause 1 and schedule 1 set up Food from Britain and give it a council of 13 to 15 members, who will be appointed by agriculture Ministers, having regard to all sectors of the industry concerned throughout the United Kingdom.

Clause 2 transfers to Food from Britain the functions of the Central Council for Agricultural and Horticultural Co-operation, which are to improve and develop co-operation. The clause also gives Food from Britain power to co-ordinate and develop marketing in the widest sense in agriculture, horticulture, fish—other than fresh sea fish, which is dealt with by the White Fish Authority—and food produce. Powers are deliberately given wide definition so that Food from Britain has maximum scope to develop and implement a flexible strategy.

Clause 3 and schedule 2 provide for the dissolution of the central council and for the transfer of all its rights, obligations and property to Food from Britain.

Clause 4 reflects the intention that Food from Britain should, after a period of Government funding, obtain the finance for its marketing functions entirely on a voluntary basis from the industry. The clause enables statutory bodies in agriculture to contribute towards the cost of the marketing activities of Food from Britain if they wish. That involves widening the present functions of the statutory bodies to include such voluntary contributions.

Clause 5 lays down the standard requirements for the production and auditing of an annual statement of accounts and for their presentation to Parliament by Agriculture Ministers.

Clause 6 empowers Food from Britain to borrow temporarily up to £500,000. The provision is intended to cover only temporary cash flow problems. The clause also enables Food from Britain to make grants or loans.

Clause 7 will enable Ministers to make grants to Food from Britain. The Government's intention is to provide pump-priming funds for the first five years for the organisation's activities, in addition to the present Government support of £1½ million a year to the central council for its co-operative development functions, excluding grants. The Government will provide up to £14 million over the five years—1983–84 to 1987–88—for the marketing activities of Food from Britain.

The funding by the Government of co-operative functions remains as provided for in section 58(9) of the Agriculture Act 1967. Clause 7 also enables Ministers to lend to Food from Britain and to remunerate the members of its council.

Clause 8 deals with the interpretation of various terms used in the Bill and clause 9 names the Bill, provides for it to cover Northern Ireland and for repeals, which are mainly consequential, on the transformation of the central council. The clause also provides for the coming into force of the Bill by statutory instrument. It is intended to do that two weeks after the Bill receives Royal Assent, in order to set Food from Britain in full operation as soon as possible.

I hope that the Bill will have support not only from all sections of the industry, but from all parts of the House. I think that we all agree that in our agriculture, horticulture and food industries we have a uniquely effective area of potential economic expansion and growth in a world in which such expansion and growth are difficult to achieve.

I hope that the House will co-operate in seeing that the Bill reaches the statute book as speedily as possible. It will make an important contribution and perhaps at the end of the decade we shall be able to say that we started it with production and research that was as good as any in the world and ended it with marketing that was also as good as any in the world.

5.6 pm

Mr. Mark Hughes (Durham)

I echo the Minister's comments about his specialist advisers. I know two of them—Ann Burdus, who was my dentist's wife, and whom I therefore treat with great care, and Dennis Stevenson, whom I knew while he was chairman of the Peterlee and Aycliffe new town corporation. They have served this country and agricultural interests very well.

I have been a Member for only twelve and a half years, but I have always believed that it was the custom and practice to announce the membership of a statutory body only after the House had given a Second Reading to the Bill establishing that body. Announcing not only the chairman-designate but the whole membership on 7 June, when the Second Reading of the Bill is not due until late November, appears to be somewhat discourteous to the opinion of the House. It precludes, or appears to preclude, the possibility that the House might not agree with the details of the new organisation, the form that it is to take or the powers to be given to it.

I have no objection in principle or ad hominem to any one of the names announced by the Minister in June, but it is taking the House for granted for us to be told the membership when after this debate we shall have to pass the money resolution to set up Food from Britain and give it statutory powers. If a money resolution means anything, surely it means that a body corporate does not exist until the House has passed that resolution. That is what we shall be voting on later.

In my time the normal practice has been to announce the chairman-designate and so forth after Second Reacting. I would have no objection to that. If, as a result of requests from the Scottish Farmers Union or other bodies, there is a suggestion in Committee that in future it should not be the Minister of Agriculture, Fisheries and Food who determines the membership but that it should be determined according to interest, an amendment cannot easily be moved in Committee because the membership has already been nominated and therefore it would seem to be an attack upon the persons involved.

I do not object to the gentlemen in question. The deputy chairman, Mr. Cargill, is a man of the highest calibre, a supreme example of Scottish farmers, against whom I have no objection—quite the reverse. If anything untoward happened to him there will be no guarantee under the Bill that any Scottish farming interest is preserved on Food from Britain in future. Under the previous legislation the Scottish NFU had that right. If the same applied to a Welsh member, that right would be automatic under the previous legislation. I shall not say a word against the worthiness of the individuals ad hominem.

In Committee we will wish to ensure that the House has the power to change that position. By his press statement on 7 June the Minister has put hon. Members in the difficulty that we might appear to have objections to the persons, although we do not. We must move away from such objections to the need to ensure that they are representatives of bodies rather than the creatures, however exquisite, of a Minister.

Before a Second Reading is given to the Bill, may we be assured that so far not one penny piece of public money has been spent upon activities related to Food from Britain? If it has, what is the purpose of the money resolution that is to be debated next? It is then and only then that the House can permit the expenditure of money on a body corporate to be known as Food from Britain.

Therefore, I ask for a formal assurance that can be put to the Public Accounts Committee that under no circumstances have any allowance, remuneration and pensions, or such sums for the provision of pensions, to or in respect of any member of Food from Britain, and such sums to a person on his ceasing to be a member of Food from Britain been allocated to this date.

Can I and the House be certain that not one part of one hour has been spent by those employed under statute on the Central Council for Agricultural and Horticultural Cooperation upon a body before the House has given its approval to the money resolution? If not, I shall seek to raise the matter with the Public Accounts Committee.

If a Minister chooses a press release as the means to set up a body, and five months later seeks parliamentary approval of its membership and powers, and has then to have a money resolution to provide the money for the board to do its job, it is proper for the House to inquire whether in the interim any activity at all has been paid for with public money.

Mr. Maclennan

As a member of the Public Accounts Committee, I am interested in the point that the hon. Gentleman has made, although he has taken 10 minutes to make it. Has he any evidence to suggest that the Minister has behaved in a way which would be completely unacceptable?

Mr. Hughes

I have no evidence. I am asking for it.

The annual report for 1981–82 of the Central Council for Agricultural and Horticultural Co-operation, outlines the grants for livestock and product marketing campaigns. Grampian Pig Producers received a grant of £16,372, the CCAHC contribution to which was £6,196. It continues: Identification of Grampian Pig Producers' originated pork by means of pack stickers. Total cost £4,135, CCAHC contribution £2,067. Over the page one sees details of potato product marketing campaigns: Saphir Potatoes Family Farm Federal. To promote ware potatoes to wholesalers … Total cost £16,150, CCAHC contribution £8,075.

I preclude the possibility of improper conduct, but it is curious that the chairman and vice-chairman of Food from Britain will have a controlling interest in the recipients of those grants. I ask only whether it is in the public interest that the chairman and vice-chairman should be associated with companies which are the recipients of grants of that order and which are under their control. I am not suggesting for a moment that anything improper has occurred.

Mr. Geraint Howells (Cardigan)

With respect, the hon. Gentleman has baffled the majority of hon. Members by his remarks. What is he trying to prove to the House this afternoon?

Mr. Hughes

I am trying to suggest that if one leaves the membership of the board to the totally free discretion of the Minister of Agriculture, Fisheries and Food, it will always be open to hon. Members and other people to query the validity of and qualifications for that membership. However, under the previous regulations and the previous Act, the Minister could not determine that. Therefore, in Committee we shall table an amendment to make certain that the future membership of the board, as of the previous board—

Mr. John Major (Huntingdonshire)

We do not want formal committees.

Mr. Hughes

The hon. Gentleman does not like committees. Fair enough. He does not want representatives of the co-operative associations on the board. Is that what the Minister is saying? If he is saying that he wishes to exclude representatives of the co-operative associations from the new body, that is all right. We shall know what he is saying. In Committee, we shall seek to reintroduce that provision. Persons should represent bodies rather than acquaintanceship with a Minister, which we find distasteful.

It is objectionable that not one member of the National Farmers Union is included by right and statute on the new body. Not one Scottish farmer and not one Northern Ireland farmer by statute is included. That is part of the problem. Not one member of the co-operative associations is included by statute. That is our primary objection.

Secondly, we fear that because the co-operative activities of Food from Britain are not included in the Bill they may be forgotten. In Committee we wish to reintroduce the necessary pressure on that body to improve co-operation. We want to bring the clauses of the Agriculture Act 1967 back to the forefront rather than leave them as a residue, which is what the Minister appears to want to do, despite his kind words.

Therefore, we do not wish to vote against the Bill, because we are in favour of improving the selling of British produce. There are major problems and there is major disquiet. However, I trust that my right and hon. Friends will allow the Bill a Second Reading so that we can consider it in more detail in Committee.

5.23 pm

Sir Peter Mills (Devon, West)

I welcome the chance to speak in this important debate. I shall not attempt to follow the points made by the hon. Member for Durham (Mr. Hughes) because I was a little confused by what he was trying to say. I hoped that he would turn his attention to the contents of the Bill. It is important that we should hear the views of the official Opposition, and perhaps we shall hear them in the wind-up speech.

The Bill will be particularly important for the area from which I come—the South-West—because it is one of the largest food-producing areas in the country. I congratulate my right hon. Friend the Minister of Agriculture, Fisheries and Food on bringing forward the Bill. It has taken a long time and many consultations to get it going. However, I believe that it has the good wishes of the agricultural community and of most of the food industry. Therefore, I congratulate my right hon. Friend on this major step forward.

The Bill deals with marketing. This is not a party political point. I hope that I shall be helped when the Opposition spokesman winds up the debate. I have studied carefully the Socialist document "A New Direction for British Agriculture."

There is virtually nothing in it about marketing. That is sad because the Government have not only dealt with the production of food, but are now seeking to deal with the marketing of food. I should like to hear the Opposition's views on that aspect and why it is left out of that important document.

There was an extraordinary Social Democratic Party conference recently at Taunton. Nothing was said about marketing, but this was said about meat: We believe that if people eat less meat there will be less pressure on the environment.

That is interesting. However, it is important that the SDP should have a policy on marketing.

I am pleased that a representative of the Liberal Party, the hon. Member for Cardigan (Mr. Howells), is in the Chamber. The five or six points for agriculture and food in the Liberal programme are clearly set out and are good. I support many of them because they fall exactly into line with what my right hon. Friend has been doing. However, no mention is made of marketing. It is important for farmers, particularly in the South-West, to know the policy of the Social Democrats, the Liberals and Labour on marketing. That is an oversight. Those parties have forgotten marketing. Perhaps the Bill will remind them of its importance.

Mr. Stanley Newens (Harlow)

I think that the hon. Gentleman will agree that the Central Council for Agricultural and Horticultural Co-operation was set up by a Labour Government and that throughout the years the Labour Party has supported the objective of improving marketing in that industry. The hon. Gentleman should not endeavour to strain the point that he is making. He should recognise our concern.

Sir Peter Mills

In the past, Socialist Governments were concerned about marketing. The document "A New Direction for British Agriculture" does not say anything about marketing. At the end of the debate we might hear the views of the official Opposition. I think that is a fair point to make.

Agricultural production last year was first-class. The farmers were fortunate with the weather, and my right hon. Friend gave them every encouragement. Productivity is good. The work force is good, flexible and helpful in every way. However, when it comes to marketing, there are exceptions. British agriculture fails in that respect. Some farmers—not all—think that they have only to produce the food and that they can leave others to market it. Such an attitude cannot continue in this difficult and busy world. In the harsh and competitive world in which we live we must take marketing seriously. That is why I welcome the Government's initiative.

I have had experience of marketing and co-operation in France. Other countries in the Community are ahead of us. We need to make improvements. Too often we are inclined to leave that to others. That cannot continue. The Bill is a step in the right direction.

Another reason why we should get our marketing policy right is the power of the multiple retailers, who are demanding more—rightly so, because the consumer requires more. Therefore, we must get our marketing policy right.

There is a role for the co-ops to play. I hope that this proposal does not mean any weakening in the Government's intention to back the agricultural co-operative movements. There is a role for private industry and the co-operative movement in agriculture.

Marketing must be improved because of consumer demand. The consumer is the most important person, and we must produce what he or she requires. When I started farming people would say "Us likes to produce what us likes." That has finished. We must have first-class marketing and presentation.

Unless marketing is properly organised, we shall have to deal with second-grade produce. It is not possible to have only top-class produce. Exporting countries—Denmark, New Zealand and, to a certain extent, France—know how to deal with second-grade produce. They export only their finest and best. I see that the council will have a role in ensuring that only top quality produce is exported and displayed at various European food fairs.

Clause 2 deals with activities to co-ordinate the marketing of agricultural produce. Does that mean that that body could have a financial role in dealing with the problems of meat plants where rationalisation is needed? A lead needs to be given if we are to market our meat and bacon products properly in future.

Clause 3(2) provides for the dissolution of the Central Council for Agricultural and Horticultural Co-operation. I hope that there is no weakening of the Government's interest in the co-operative movement. On the surface it appears that might be the case, but I do not believe that to be true.

Mr. Peter Walker

I assure my hon. Friend that there is no weakening in that respect. We have categorically stated that the financing of that activity will be retained in real terms for the next five years.

Sir Peter Mills

That is the welcome news that I wanted to hear, and it comes straight from the horse's mouth.

Clause 6 provides that Food from Britain may with the consent of the Ministers make grants or loans for marketing purposes only, not for co-operation. It is important that we understand what aid can be given for marketing and for what types of food production.

I am connected with the Milk Marketing Board and many dairy farmers. I hope that the promotion and marketing of margarine will not be helped. I believe that the public are deceived by many margarine advertisements which feature pictures of cows and rural scenes.

Unfortunately, butter consumption is decreasing. Butter does not do any harm. We should take no notice of the doctors. I have lived on butter and Devonshire cream for years, and I am as fit as a fiddle. I shall continue for the rest of my days never to eat margarine, because I believe that butter and Devonshire cream are much better.

I believe that there should be some control to ensure that the proposed body does not help to promote the production of produce that does not stem directly from British agriculture. How many members of the public or hon. Members know what certain brands of margarine contain? It is horrible. I am exaggerating slightly, but that needs to be watched. One should seek to promote, market and spend money only on British products. I am a great fan of British agriculture. I believe that we should market—and eat—British products at home and abroad. I believe that the Bill will go a long way in helping to do that. I congratulate my right hon. Friend on introducing the Bill.

5.35 pm

Mr. Geraint Howells (Cardigan)

I am grateful for having been called early in this important debate. I declare my interest as a farmer. It is an encouraging sign for agriculture that a Government have for once given priority in the parliamentary calendar to a Bill that can only, if its aims are fulfilled, improve farming. I congratulate the Minister on his efforts on behalf of an industry that has too often been relegated to the background.

I do not believe that the official Opposition have risen to the occasion as they should have done, by not supporting the Government and in turn supporting agriculture. I have emphasised on many occasions in the House that agriculture is the most efficient industry in Great Britain. Agriculture and horticulture make up the country's biggest industry. It employs over 600,000 people and provides over 60 per cent. of all food eaten in this country and 75 per cent. of the food that can be grown in a climate like ours.

Within the EC there are 3 million farmers producing food for 300 million people. Each farmer has to provide food for 100 people. Every endeavour must be made to help marketing in this country and within the EC. There has been a steady growth in productivity for many years of about 4 per cent. per annum. That excellent record has enabled farmers to make a valuable contribution to the national economy, because of the savings made to the United Kingdom balance of payments.

However, competition from European countries increases every year. We have all watched with admiration, and some anxiety, the aggressive and effective marketing of products from Europe. French and German agriculture have benefited greatly from schemes and promotional organisations that have been heavily funded by their Governments. The way to counter that is not, as some defeatists would have it, to erect protective barriers against imports, but to launch an effective counter-attack. I see the Bill and the setting up of the new organisation Food from Britain as one step in the right direction. I also welcome the fact that the functions of the Central Council for Agricultural and Horticultural Co-operation will be taken over and developed in the new arrangements, as over the years the council has had a beneficial influence on the work of co-operatives.

I am well aware, for example, of the good work done in Wales by the Welsh Agricultural Organisation Society, which has been functioning since 1922, and since the CCAHC was set up in 1967 it has acted as its agent in Wales. It has used funds from that agency to promote and develop co-operative marketing, and an excellent example of that is the system of livestock groups in each county in Wales, marketing centrally through Welsh Quality Lambs Ltd. That has worked so well that it has become a model for other schemes and I understand that a Scottish scheme, along the lines pioneered in Wales, is being set up.

The total combined turnover of the Welsh agriculture co-operatives is now well in excess of the £100 million reported in 1981, with the total number of those directly employed within the co-operatives in the region of 1,000. A similar number derive employment as a direct result of the existence of that co-operative network.

Such effort, exemplified in the work of the WAOS, will, I hope, continue to receive full encouragement under the new arrangements, as it has already gone part of the way towards meeting the Bill's objectives in encouraging producers to become more effective in marketing and persuading them of the value of becoming active participants in the promotion and marketing of agricultural products at the consumer end of the marketing chain. Therefore, I trust that there will always be adequate funding for co-operative ventures as a vital part of British agriculture.

I am sure that the Minister will agree that we should pay tribute not only to the WAOS and the equivalent bodies in Scotland and other parts of England, but to those who operate the livestock and auction systems in this country. They are also doing excellent work. As long as the livestock sector and the auction system are working in harmony with the WAOS and other organisations, the agriculture industry is assured of a bright future.

As I would have expected, there has been a general welcome from the farming unions for the Bill and its provisions. I hope that the farmers will now take advantage of the help offered and at the same time become more sensitive to the needs of the consumer, both at home and abroad, as that is an essential element in any marketing effort.

If Food from Britain fulfils its promise to enlarge the markets for British products and to bring about the cohesion of marketing efforts, it will be beneficial to the industry and to the country as a whole. I look forward to the day when food from Europe will be our main marketing ambition. We may then be able to dispose more effectively of our food surpluses within the Community. On behalf of the Liberal Party, I wish the Bill and the Minister's deliberations well.

5.44 pm

Mr. Colin Shepherd (Hereford)

I am glad to have an opportunity to add my two bits' worth to this important debate on a Bill that is the start of a success story. Since success breeds success, the Bill is also a reflection of the work done by my right hon. Friend the Minister and his team at the Ministry. In this Parliament, the most outstanding success has been the change in the fundamental attitudes dominating agriculture. I sometimes wish that that change would permeate the rest of British industry. However, a start has been made. The agriculture industry has led the way and the Minister is responsible for that.

When I first came to the House I was amazed by the rather comfortable approach of the agriculture industry. I was often told "Tell us what is wanted and we will grow it." It was expected that the Government would say what was wanted. In the previous Parliament the Government were obviously more interested in other things and agriculture's welfare was not at the top of the list. The cry then changed to "Do the Government want an agriculture industry, an apple industry or a sugar beet industry?" It was a whinge. The answer had to be "Not really, because a cheap food policy must mean purchase from wheresoever, at the lowest possible price, and to blazes with tomorrow or the longer term."

I come from industry, where a market has to be found, developed and retained against ever more intense competition, and I know that we must recognise that we have to defeat competition not only today but day after day, month after month and year after year as that competition responds to initiative. The comfortableness of that first statement, which sticks in my mind, was mind-bending, It was curious that people should have looked to the Government. However, further investigation showed it to be a request conditioned by the managed market and the cosy protectionism and paternalism of the post-war period, when United Kingdom agriculture was only a topping-up industry for the high percentage of imported foodstuffs. My right hon. Friend the Minister has demonstrated our agriculture's success in changing in the past few years. We are now about 75 per cent. self-sufficient in temperate foodstuffs and that is a remarkable track record, which should be recognised by the House.

In the intervening period it became clear that United Kingdom agricultural thinking had not caught up with the growth in technical ability and with political change. The change in the balance of trade contribution by the industry in the past five years of £1,000 million per year is not to be decried. The Bill points the way to the jackpot. I was glad that my figures tuned in with the Minister's. The fact that about £3,250 million has yet to be achieved gives us a target to aim for. It does not even take into account the additional export opportunities.

We face an immense challenge. However, if a £1 billion contribution can be achieved with a fundamentally negative attitude, what may not be achieved with a positive attitude? The Bill sets out to change the scene of British agriculture so that a positive attitude permeates the industry. Food from Britain has an enormous contribution to make to the development of positive attitudes. It is the type of organisation to help the industries answer the fundamental questions of what we produce, how much and at what price.

It was right for all those concerned to respond cautiously to the report of the British Agricultural Export Council in March 1981. We have seen quangos before. Was this to be another hidebound monster? I was always worried about the apparent non-effectiveness of the central council. I may be wrong, and someone may shoot me down in flames, but years ago someone remarked in Punch that a play was "shattering" in its lack of impact. That changed with the appointment of Nick Saphir as chairman. I welcome his appointment as chairman for Food from Britain.

The shape of Food from Britain is not without encouragement. It is a comparatively small and lean council. I take issue with the hon. Member for Durham (Mr. Hughes). He put his finger on the difference of approach between Socialism and free enterprise. The rigidity that would be introduced by having statutory representation—people being elected from virtually every body—would make Food from Britain into a hidebound monster. That does not mean that there is not an immense responsibility on the incumbent of the Minister's job to keep in touch with the industry so that the bright stars of that industry do not go unnoticed. They should be recognised and drawn in to make their valuable contribution to the industry. It is an enormous challenge, and it would be stifled if there were statutory representation. What is being done is a big gamble. We have not witnessed a palpable track record of successfully changing the attitudes of the industry by what has gone before. We must, therefore, step out into new pastures and be brave.

I like the structure of Food from Britain. I call it a self-liquidating quango—it absorbs one and then sets out to dissolve itself. It is also important to achieve a proper balance of the interests concerned. It must be monitored. Clause 5 properly requires that a report be presented by Ministers to Parliament with an annual report that is prepared by Food from Britain.

The wastepaper baskets of the House are regularly stuffed full each day with this or that report from this or that public body. Of the things that they have in common, one is that they are nearly all unread and another is that they are inordinately over-elaborate and expensive. I plead for a plain, simple to read, short and inexpensively produced report that is in tune with the industry that it serves. Moreover, the money should be kept at the sharp end, where it is needed. There is not a bottomless supply.

Food from Britain must monitor itself so that it does not become cumbersome and bureaucratic. It must he lively in mind and approach and it should reflect, and continue to reflect, the unfettered approach of the Minister's five Marketeers when they analysed the problems in the first place. It must also be innovative and stay within its financial constraints. The continued identification and recruitment of new talent is also a major responsibility.

In his press statement on 7 June my right hon. Friend the Minister said that the success of the organisation will thus rightly depend on its ability to convince the agriculture and food industries that the services it provides are worth paying for. I want to see full and enthusiastic commitment from all sectors of the food industry. The taxpayer is putting up about £20 million through the Government. Equivalent enthusiasm is the least that the relevant industries should contribute to match that investment in our future.

A few years ago I went to Covent Garden early in the morning as the guest of a fruit retailer. We saw how Kingdom apples were being marketed. I picked out the stall where Kingdom apples were on display. I saw a major producer of apples who, although he apparently supported Kingdom packs, was promoting them under his own name. I remarked on that and noticed that tucked away in the box was the little Kingdom insignia. I questioned my host on the matter and he told me that the supplier was waiting to see which way the market bounced before committing himself. I do not want to see that. I want to see proper commitment from Food from Britain.

Only if there is commitment up front will the new body get off the ground and be able to contribute as it should. It is not enough for the industry to sit back and wait and see. It should be in full cry for a larger share of the market abroad and a greater share of the home market. I welcome the Bill as an essential step in that direction.

5.54 pm

Mr. Stanley Newens (Harlow)

The Bill proposes the establishment of a new organisation to develop and co-ordinate the marketing of agricultural, horticultural and food produce. We all support that. I hope that the hon. Members for Hereford (Mr. Shepherd) and Devon, West (Sir P. Mills) will not, for party political reasons, suggest that the Opposition do not fully support the Minister's objectives in that regard.

More than 10 years ago, a committee under the chairmanship of Sir Richard Trehane suggested that such an organisation should be formed, that it should be controlled substantially by the producers and that it should have similar objectives to those set out in the Bill. By setting up an agency that will include representatives from distribution, manufacturing, farming and horticulture, the Bill should provide the basis for improving the marketing of British produce, as has been done by similar organisations in France and Germany. That is a desirable objective.

We should recognise that much of the food that is produced in Britain is of higher quality than that produced elsewhere. British people often fail to recognise that. One example dear to the hon. Member for Hereford is apples. We probably produce the best flavoured apples in the world. The huge marketing campaign in which the French have indulged with Golden Delicious—a heavier cropping apple—has convinced some British people that our produce is not of such good quality, although it is better.

It will be recognised that the Bill is in the interests not only of the agricultural, horticultural and food industries, but of the consumer. However, I am worried about the way in which the Central Council for Agricultural and Horticultural Co-operation is to be superseded by the new organisation in spite of the Minister's assurances. I agree that it would not be sensible to have both the CCHAC and Food from Britain in existence at the same time, but the full list of the CCHAC's functions and objectives have not been restated in the Bill. Apart from the transfer of the functions mentioned in clause 2 and the arrangements set out in schedule 2, there is no commitment in the Bill to promote co-operation. That may be what the Minister intends.

Co-operation is a proven method of organising marketing in agriculture and horticulture. Perhaps part of Food from Britain's function will also be to promote co-operative marketing. However, it is not right that the Bill should not state that explicitly. I hope that that omission will be rectified in Committee.

We must remember that originally the central council's objectives were not limited to co-operative marketing. They also included co-operation to provide assistance with production, storage, transport, common purchasing, research and the spread of information about the principles and methods of co-operation. The Bill mentions none of those things.

Some critics may argue that the central council has not done enough to promote and fulfil those objectives, despite the excellent job that it has done to encourage co-operative marketing. Even if that were so, it is no reason to depart from the objectives of the 1967 Act. We should seek to encourage the fulfilment of those objectives in our agriculture, horticulture and food industries.

Although the Minister had early associations with the milk distribution sector of the co-operative industry, he may not share all my views. However, there is a strong argument to support the view that the co-operative form of enterprise ought to be encouraged as a means of giving men and women the opportunity of participating in their own businesses as well as enabling existing business to co-ordinate their functions.

So far, the Bill does not seek to achieve that objective. I have always taken the view that small business should be encouraged. The small business man is an important person in the community. In view of my family background, I speak with as much knowledge of that issue as Conservative Members. If people get together in a partnership or co-operative, they should be encouraged just as much as the one-man concern. The central council's function to promote such encouragement should not be overlooked or discarded following the introduction of this new organisation. At present, Food from Britain will not be charged with that responsibility. That must be put right.

Links with the retail industry are also desirable. One of the difficulties of achieving this in the past has been that agricultural and horticultural co-operatives have sought to get the highest prices for their products while retailers, through competition or acting on behalf of consumers, have been forced to seek the lowest possible prices. The Bill aims to bring producers and retailers together and recognises the part that each must play. That is a desirable aim. However, I regret that there has been so little mention of the retail co-operative movement, which has the closest affinity with co-operation in agriculture.

Mr. Peter Walker

I recognise the important role of the retail co-operative movement. Recently I visited some of its establishments and discussed the matter with its representatives. I have also corresponded with the movement and asked it to take a full and active part in the launch of this organisation.

Mr. Newens

I am delighted that the right hon. Gentleman has taken that action, but to date that aspect of his activities has received little attention. It is important to bring the retail co-operative movement into this sphere of activity more fully than hitherto.

The Plunkett Foundation, founded by Sir Horace Plunkett in 1919, has over the years sought to bring retailing and agriculture together in the co-operative sector and has undertaken some interesting research. As long ago as 1928, Dr. Margaret Digby wrote a book—"Producers and Consumers"—for the Plunkett Foundation. That book advanced some of the very ideas that many people are now lauding as newly discovered. Here I declare an interest as a Labour and Co-operative Member of Parliament who has held office in the retail co-operative industry.

In view of that long-standing interest, which is just as alive as ever, I hope that careful consideration will be given to how best the retail co-operative movement can be drawn into this desirable project.

It is hoped that in five years the cost of Food from Britain will be borne entirely by the industry. I am slightly concerned about that. It is possible that in five years the organisation will be so successful that someone will propose that it continue along the lines of the central council. On the other hand, some organisations may exercise an undue influence over the way that Food from Britain develops. Therefore, I hope that the proposal to cut support, except that provided by the industry, will not finally be determined now.

This is particularly important with regard to cooperation. It is possible that in five years the organisations represented on the board, if they do not include the co-operative organisations within the agriculture industry and retail trade, may discard an important part of the functions which many of us feel should be incorporated in Food from Britain's future objectives.

Mr. John Carlisle (Luton, West)

The hon. Gentleman has gone part of the way to answering my question, but what organisations does he envisage might take over Food from Britain?

Mr. Newens

I shall not speculate. I could be controversial and advance views that are not acceptable to Conservative Members. However, when I think that the Government are doing something of merit, I see no reason to pick holes in it. Many of these organisations should be represented. The Opposition believe that Britain should have prosperous fanning and food industries. I do not wish to predict what may occur. I believe that anyone who considers the issue in a balanced way would wish to take these points on board.

The Bill needs some amendment. Future Ministers and food producers may not be aware of all the problems that we have mentioned today. That is why we should modify some of the clauses. It is important that our food, agriculture and distribution industries should get together to promote the marketing of our goods. In that respect I support the Bill.

6.10 pm

Mr. John Farr (Harborough)

The hon. Member for Harlow (Mr. Newens) made some sensible suggestions about marketing food. I agree that the quality of some of our English apples is unsurpassed.

I congratulate my right hon. Friend the Minister on the Bill. It has been said that the Bill perpetuates a quango. Once the organisation becomes self-supporting it will no longer be a quango but an ango—an autonomous non-government organisation—which is a step in the right direction.

I have several questions which the Minister could answer either now or later. Is the FFB—the Food from Britain organisation—to be set an annual target by the Government? Statistics from the Library show that staggering progress has been made not only in increasing exports of food but in cutting down food imports. The change has been dramatic. According to the statistics, between 1979 and 1980 there was an 11 per cent. increase in the volume of food exports and a five per cent. reduction in food imports. That is great progress. Perhaps the Standing Committee that considers the Bill could discuss the possibility of establishing an ideal target for the organisation.

Will the FFB's activities include the export of beer and spirits? I see my right hon. Friend the Minister nodding. I am pleased about that, because the export potential is tremendous. We are experiencing a boom in imports of wines and spirits from the Continent and elsewhere. I hope that the FFB will concentrate on stirring up the potential market for British beer and spirits in Europe and elsewhere.

I hope that the FFB will concentrate on the market for the many British foods which do not seem to be appreciated outside Britain. The best cheese in the world, Stilton from Leicestershire, comes to mind immediately. The only time that I have seen Stilton promoted abroad was at an event in Strasbourg, when the French, Dutch and Belgians were given a chance to eat it. They wanted more, but they could not buy it there. I hope that a serious attempt will be made to exploit the export potential of our many other splendid cheeses, such as Cheshire, Leicester and Cheddar, and our new soft blue cheese, which could be an export winner. Once Lymeswold cheese is available thoughout Britain, it will have great export potential.

Sir Peter Mills

Does my hon. Friend agree that there is also a case for exporting rare delicacies found in some of our counties, which are known only in certain areas? I think of such products as Devonshire hog's pudding, Cornish pasties and starry-eyed pilchard pie.

Mr. Farr

I am grateful to my hon. Friend for that intervention. I am glad that he kept it brief, because the matter is serious. Each locality in Britain has its own speciality. The Midlands, Hereford and elsewhere have their own delicacies, some of which are better known than others. I hope that FFB will organise not only for the British market on a national scale, but for the markets abroad so that others can share the delicacies that we have enjoyed for many years.

The difficulties in the beef industry have been mentioned. There must be rationalisation of the industry at home before it can gain a bigger share of the export market for beef on the hoof and in carcase or processed form. The potential is there for expanded exports. Sections of the industry suffer from overcapacity, particularly in slaughtering and on the factory side. The FFB should help to persuade the beef industry to rationalise so that it is modern and up to date and can go forward with confidence in promoting British beef exports.

Several other matters are important and the FFB should be entrusted with them. One cannot export hay and straw from Britain to certain other Community countries. I do not know why it is forbidden. We cannot export hay and straw to the Republic of Ireland, because EEC regulations forbid it. There is an export potential for the best British hay, from East Anglia for example, to the Continent. The FFB should follow that up.

Another big market has been denied to Britain and has cost the country about £1½ million in foreign exchange in the last 18 months. I refer to the export of game, and particularly pigeons, from East Anglia to the Continent. European Community health regulations have forbidden the export of game from Britain. What formerly earned us more than £l million a year in valuable foreign currency is now denied to us.

I hope that Food from Britain will work on behalf of all our poultry exporters. I do not wish to see our poultry producers on the defensive because of a massive French turkey factory just across the Channel. Food from Britain should be anxious to promote the export of turkeys and feathered fowl of all sorts. Some of our poultry producers have been hit by the threat from the Continent. I welcome the Bill.

6.20 pm

Mr. Robert Maclennan (Caithness and Sutherland)

I join all those hon. Members who have expressed a strong welcome for the Bill. Everybody welcomed it, with the notable exception of the spokesman of the official Opposition, the hon. Member for Durham (Mr. Hughes), an exception which was regrettable. The Minister deserves special credit because of the interest that he has taken in agricultural marketing from the moment that he took office. He put a personal stamp on the drive towards improving agricultural and horticultural marketing. In trying to interest others in the industry in his objectives, the Minister has shown genuine enthusiasm.

If I ask several questions about the Bill, I hope that the Minister will understand that I am not being querulous but that I am fully committed to the objectives of the new organisation, Food from Britain, that the Bill will set up. However, I have heard farmers ask wryly whether the Minister's enthusiasm for promoting marketing might divert him from recognising that there are other areas of major importance in agriculture. For example, the Gracious Speech made no reference to proposals for the amendment of the agricultural holdings legislation.

Some farmers have also said that the emphasis on marketing—important though it is—was designed to divert attention from the startling decline in agricultural incomes during the Minister's period of office. The Minister's emphasis on marketing has been used on several occasions in the House to justify the price settlement that he achieved in Brussels earlier this year. However, I dissociate myself from ascribing any motives to the Minister other than a desire to form a more effective British marketing organisation.

The importance to agriculture and horticulture of effective marketing is underlined by the crises in several sectors during the past few years. The top fruits industry faced especially powerful marketing efforts from the Continent. More recently, the poultry industry has experienced a crisis. However, as the hon. Member for Harborough (Mr. Farr) said, it would be wrong to regard the setting up of Food from Britain solely as a reaction to import penetration.

There are prospects for enlarging our share of the European market by more effectively promoting British food, which is of superior quality. The hon. Member for Harborough was about to take us on a gastronomic tour of Britain to sing the prates of the food that he favoured. I should love to follow him down those lanes and promote Dunlop cheese from Scotland, haggis and other delicacies.

I hope that the Minister will answer some of my questions when he replies, but others may be more suitable for discussion in Committee. How do the Government see the operation of the Food from Britain both in the short term, when they will be largely responsible for its financing, and in the longer term? I hope that the Government will not simply take refuge in the view that that is a matter for the organisation, although of course it must have prime responsibility. It would be possible for the organisation to concentrate mostly on advertising, but that may be dangerous because the beneficiaries of the advertising would not provide long-term finance to the organisation. Advertising may be of less benefit to food producers than to those further down the distribution chain.

A notable and obvious omission from the coverage of the organisation is sea fish. The Minister said—1 believe that it was a slip of the tongue—that the White Fish Authority was responsible for promotion. However, the Sea Fish Industry Authority's responsibility in that area is well known and important. Did the Government discuss with the industry whether it would be sensible to bring the promotion of sea fish into the umbrella organisation? Sea fish is marketed in competition with many of the products that will be promoted by Food from Britain and we may need co-ordinating links between the organisations to ensure that they work together.

I do not dispute the nominations to the council. The individuals seem to be well versed in the appropriate trades and are well known to those who are interested in agriculture and food. However, two places are still vacant and it may be appropriate to appoint not a statutory representative but someone who is involved in the industry as a consumer. There is only one woman among the 13 members of the board, although most agriculture and food promotion is directed towards women shoppers. I hope that that will not be regarded as a sexist remark either by those who believe that men should do as much shopping as women or by those who believe that it is improper to draw attention to the sexual imbalance of such a committee. Consumers should be involved directly in the work of the council. The present members would be the first to admit that the satisfaction of the consumer is the prime objective of successful marketing. I am not sure—this is a Committee point—that the provisions governing membership of the council would permit a consumerist to be appointed. Perhaps that is an oversight, but if it is not I hope that the Minister will feel inclined to take up that suggestion.

The hon. Member for Harlow (Mr. Newens) made an extremely thoughtful speech from considerable experience of retail co-operation. I should like to endorse some of his remarks about the worry that the amalgamation of the central council into the new organisation may lead to some loss of impetus in the work of the council in fostering co-operation. I hope that the Minister's assurance that this point has been noted, and that there will be a separate board to foster co-operation—I believe he said that there would be a separate chairman—will not be misplaced. We shall watch with great interest how that side of Food from Britain's work develops. Will the organisation be eligible for assistance from the European Community's funds that are available for promoting agricultural co-operation, of which we have made rather less use in Britain than a number of other member countries of the European Community?

The Minister has spoken of his hope that the council will move towards self financing. One can understand, both in the present climate of public expenditure and against the background of the Government's dogmatic views about public spending, that that is the type of statement that he would be able to sell to his colleagues. Some hon. Members must at least ask whether his statement about Food from Britain being capable of doing the job that he wishes it to do and being wholly self-financing, is somewhat optimistic, at least on the time scale which he has set out. I hope that he will keep an open mind, and that if it appears that the industry would be assisted by the injection of more public moneys than he presently intends, he will not set his face against it. It would not be impossible—although I may have misread the Bill—for the Minister to continue the funding somewhat beyond the five-year period which he mentioned.

It is clear that there will be a continuing Government responsibility—whether or not it is financial—for the success of the supply side of agriculture. The extent to which they are called upon to finance the industry in other ways may depend upon the effectiveness of Food from Britain. Funds for Food from Britain could be a relatively inexpensive way of helping from time to time particularly hard-pressed sectors of agriculture. I hope the Minister will be ready to accept that possibility.

The Bill is most welcome and will enjoy the support of all who are interested in capitalising on Britain's outstanding agricultural industry and on the skills of those who are already involved in retail distribution, which also has its outstanding achievements. It is important that the House should wholeheartedly support the Government on this occasion. The Bill is the culmination of a great deal of hard work by the Minister and by a number of wise people with whom he has consulted. He is owed a great deal of credit.

6.34 pm

Mr. John Spence (Thirsk and Malton)

We grow a great deal of food in North Yorkshire, particularly in the constituency which I represent. I was going to make an impassioned appeal to the Minister to ensure that there is an expert from Yorkshire appointed to the council for his knowledge of agriculture, industry and food processing. I have decided not to do that because the Minister said in his opening remarks that the characteristics for which he would be looking in his appointees are wisdom, ability, talent, knowledge and expertise. That is a definition of a Yorkshireman, so I do not need to make an appeal to him. I am sure there will be a Yorkshireman on the council.

I welcome the Bill, which lays the foundations for a unified structure which will improve marketing performance for a major British industry to the benefit of the British economy. With the exception of the sea fish side, the reasons for which I fully understand, and which is subject to a further authority, the organisation will be the marketing arm of the agriculture and food industries and will tie them together.

I am aware that we have certain other promotional agencies which will be brought together by the new council. The council will be helpful and beneficial, and I wish it well.

A number of points in the Bill, particularly in clause 2, which may indeed be implied, could be put in specific terms. For example, clause 2(2) states: Food from Britain shall have power to organise, develop, promote, encourage, and co-ordinate the marketing in the United Kingdom and elsewhere. Various matters are then mentioned. It would be beneficial from the industry's point of view and would make it explicit in the Bill, if the Bill said that there will be a power to conduct market research at home and abroad. I would lay particular emphasis on the market research abroad. We very often see in shops and supermarkets products from abroad which are nicely packaged, labelled and unfrozen and with handy instructions on how they should be cooked. As we grow the same type of foods at home, why on earth are we not doing the same thing? One finds on examination that the foreign producer has done the necessary market research into the British market, has found an opening, has spent the money on the research and then filled the gap. It would be a pity if we did not expressly charge the council to conduct the necessary market research both at home and abroad. The export market, as the Minister's figures have shown, has enormous potential.

The power to organise is conferred on the council. How the power is to be exercised is probably one of the most important questions and an explanation would be useful. It means gaining the confidence of those who produce and process our food. If we are going to organise producers we must get their confidence. That is an essential part of what Food from Britain must do.

In my constituency, agriculture, food processing, livestock production—pigs and poultry—are major businesses. I hope that the Yorkshire side, with its diverse participation in the food chain, will have proper recognition and that the confidence of that great area of the country will be gained.

We must all hope that the Bill will receive a speedy passage through Parliament. The Minister is to be congratulated on tapping this fruitful source of further income for Britain.

6.40 pm

Mr. Ted Graham (Edmonton)

I listened with appreciation to the opening speech by the Minister. I apologise for having been out of the Chamber for a few minutes but I had to go upstairs to get the results of the Shadow Cabinet election. I am smiling but I shall not give the details.

I warmly welcome the concept of the Bill and also the initiative and action of the Minister, who has obviously spent considerable time in preparing the Bill. As he said, it is not a complete package, and suggestions for improvement can be made in Committee, but the co-operative movement greatly appreciates the intentions behind the creation of the new organisation.

As my hon. Friend the Member for Harlow (Mr. Newens) may already have said, the co-operative movement has a vast experience in farming and in retailing. Indeed, it would claim to be unique in regard to that nexus, to which I shall refer later. I know that my hon. Friend intended to mention some of the worries or apprehensions that some of us might have about the educational and philosophical role of the Central Council for Agricultural and Horticultural Co-operation, once it becomes subsumed as an organisation within the management and control of the new organisation. Food from Britain.

In some of the original discussions it was suggested that there would be two separate bodies, and we are a little disappointed in that respect. Although the same people would have been on both bodies, we wanted to ensure that the co-operative propaganda and proselytising carried on by the CCAHC would continue. I hope that the Minister will explain why the initial concepts were changed, although we are not suggesting that because of the change the co-operative input will diminish.

I was particularly struck by the comments of the hon. Member for Devon, West (Sir P. Mills), who expressed his worry that there might be a weakening of the co-operative content. The Minister, in his only intervention so far, was quick to point out that there was no intention whatever to weaken the present co-operative work, and that that was not part of the philosophy of the Bill. I accept that completely but I hope that the Minister will allow me to say something about the worries of co-operators.

When the Co-operative Development Agency was established in 1976, its establishment was for a set period and it was limited in both finance and function because it was recognised that there was already in existence the CCAHC, which was founded and fathered by a Department. It was also pointed out that there was a Housing Corporation which had as one of its functions the promotion of co-operative housing.

The Minister will be aware that next Tuesday we are to have the Second Reading of the Housing and Building Control Bill, which makes a severe attack on the concept of co-operative housing by virtue of its provisions as to the right to buy for those who are members of housing associations. Therefore, we are worried that in Whitehall there will be three separate Ministries dealing with co-operative matters.

I look the Minister straight in the eye in saying that I accept completely his bona fides in wishing to maintain the integrity of the co-operative idea, but there is also a Department of Industry and a Department of the Environment. From time to time, many Labour Members have said that we would welcome some co-ordination. That is a criticism of Labour Governments as well as of the present Conservative Government. Although we are encouraged by the promotion of one aspect of co-operation, we do not want to see the other aspects weakened.

I hope that the Minister of State will repeat the Minister's assurance that his Department will ensure that the philosophy and principles of co-operative action and organisation will not be diminished but will be encouraged in the future. The official Opposition will look for that assurance.

Reference has already been made to some of the activities of the new council. The Minister has talked in terms of value for money and the proper use of public money. I draw his attention—and that of the Minister of State—to the growing relationships between multiple retailers and some agricultural organisations. No Labour Member has ever questioned the importance of marketing for agricultural or any producer-based co-operatives. Co-operative societies are fully conscious of that. The sale of their products is the touchstone of their success. Equally, the growth of direct contacts between agricultural cooperatives and some multiple food retailers has been a significant feature in recent years. The annual reports of the CCAHC give prominence to such contractual developments as well as detailing the grants given to them.

I hope that the Minister of State will take particular note that numerous joint activities are quoted in the CCAHC's annual report for 1982. It mentions a group formed by Buchan meat producers to service the Asda chain with a three-year target of 5,000 head of cattle. Given the undoubted stimulus to marketing activity which will flow from the new and dual concept, how will such marketing partnerships between producers and retailers be chosen, particularly in the case of those for which public money is to be made available? If, as a result of such cooperation, a leading multiple retailer decides on a producer co-operative buy-out, will he be allowed to do that, and on what terms, if the co-operative in question is, or has been, a financially assisted agricultural society?

The Minister will know that some agricultural cooperatives are already registered as companies or capable of conversion into companies. Integration and rationalisation, take-overs, and vertical and horizontal expansion, are rife in the retail movement. I hope that the Minister will assure Labour Members—and, indeed, those in agriculture—that public money will not be used to encourage the fattening up of an agricultural co-operative so that it may eventually be taken over by someone else.

The official Opposition are disappointed with the proposed make-up of the council. I assure the Minister of State at once that we do not cavil at the individuals who have been chosen or at the criteria that the Minister has set out. We are not to have the statutory Scot, someone from Wales, someone from Northern Ireland, a woman member and a member from the National Farmers Union. We fully understand that the Minister wishes to have a group of men or women who, in his view, can make a sound contribution to the work of the new body. I ask the Minister of State to note that in the context in which we are creating a new organisation and seeking to maximise the marriage between the producer and the consumer of food in Britain, it would be hard to find an organisation better qualified than the co-operative movement to do just that.

When I looked at the qualifications of those who have been selected—I speak from blissful ignorance of any of them but respecting all of them—I found that the extent of a farm holding was given as a qualification. However, the co-operative movement is the largest farmer in Britain and farms 29,000 acres, which is no mean size. Twenty-eight per cent. of the milk consumed in this country is produced by our sources and £540 million is taken in retail sales of milk.

The co-operative movement has its retail problems, as does everybody else. However, we still sell more over co-operative counters than any one of our competitors. Between 9 per cent. and 10 per cent. of the food bought over the counter in Britain is bought over co-op counters. That amounts to more than £3,000 million, and over 10 million individuals voluntarily decided to join their local co-operative society.

I enjoyed what the hon. Member for Caithness and Sutherland (Mr. Maclennan) had to say, and agree with his point about the council. I do not wish to diminish the credentials of those who are already on it, but if the Minister is looking for one or two more people to serve on the council, he should perhaps take into account the fact that someone with strong connections with the British cooperative movement might serve. I agree with the Minister, however, that this does not have to be someone who "represents" the co-operative movement.

It is the Minister's fond hope that in five years the organisation will be self-financing, and he told us how financial support will be diminished year by year. In five years agriculture and retailing will be making up that money. No organisation will pay more than the British cooperative movement collectively, as an agricultural producer and a retailer. I hope that the Minister takes those points on board, although I do not expect him to respond tonight.

The Minister will already be aware that the Consumers Association has made some caustic comments. It said: For a body which expects to respond to consumer-led needs it looks all too much like every other producer-led board in the food and agricultural sector. That was said before the make-up of the council was published. I hope that there is room for someone on the council with strong consumer connections.

Will the Minister take on board the following points that reflect the views of the British co-operative movement? First, may we be assured that there is a possibility that the council will be strengthened by a consumer voice perhaps from the co-operative movement? Secondly, the co-operative movement is uneasy at the possibility of absorption of producers by retailer-oriented groups. Third, there is a conspicuous silence on what will happen after the five years. Will this be reviewed, and can we be told what will happen if the money that is required is not forthcoming? Will the Minister consider extending the five-year period for financial assistance? Fourthly, can the Minister give us an assurance that the co-operative ethic—a proud part of the British scene, which is strongly supported by many hon. Members on both sides of the House—will not be lost in this newly launched council?

The co-operative movement welcomes the initiative. We appreciate the energy of the Minister and congratulate him on doing a first-class job in providing the British people with a good opportunity. I agree with the hon. Member for Devon, West that we need not only to produce British food, but to market it and encourage British people to eat British food. That is something in which the British co-operative movement has a great stake. I warmly welcome the Bill.

6.55 pm

Mr. Fred Silvester (Manchester, Withington)

Every hon. Member who has spoken so far has either an interest in the co-operative movement or a constituency that has a large farming industry. Coming from Manchester I have no farming interests, although I have one minuscule farm.

My interest in the Bill was aroused because a company with which I am connected made a minor contribution to the present effort in Holland by the British Food Export Council. Therefore, I became interested in the way in which the British food manufacturing and producing industry has substantially lagged behind in the marketing effort which, as the Secretary of State said, is so valuable.

Some points from that experience may be relevant to the new Food from Britain campaign. My right hon. Friend rightly emphasised that he was talking about the entire food industry. We have to recognise that the most organised section of the food industry is production. There already exist large and powerful food producing bodies. The scatter of manufacturers is considerable. As I know from bitter experience, any attempt to get manufacturers to co-operate is extremely difficult.

I shall not enter into arguments about who should be represented on the council, because I take the Minister's view on this matter. However, there are to be two people from the manufacturing side and one from the retail side on the proposed council. Most of the rest—I may have missed someone out—have connections either with the present central council or with one or other of the producing bodies.

It will be important to ensure that the processing industries are properly brought into the scheme. My figures may be a little out of date—they relate to 1980—but I understand that our exports of processed food were worth about £1,200 million. Exports of raw, natural produce totalled about £600 million. Although the processed food figure includes dairy products, which most people regard as normal agricultural products, we are nevertheless talking about substantial amounts of processed food. The biggest inroads made by the CMA from West Germany in recent years have been in processed foods, such as confectionery, pickles, biscuits and goods of that kind.

We should beware of overlap. My hon. Friend the Member for Harborough (Mr. Farr) insisted on calling this proposed organisation the "FFB". I twitched a little when he said that. One thing that has struck me, when researching this subject, has been that, apart from defence and the United Nations, I know of no other subject that has so many initials. There is the BOTB, the EEB, the various embassies, the BFEC and the chambers of commerce. All these organisations are busy in this trade. It is important to recognise the strong co-ordinating job that Food from Britain will have to play.

I note that my hon. and learned Friend the Minister for Trade is a sponsor of the Bill. However, it is not a primary concern of the Department of Trade, which means that there is a difficulty. The Department of Trade spends about £82 million abroad on promotion of British goods and services including food. It has many pots of gold—so many, in fact, that when one is involved in discussions, the BOTB is so keen to be helpful that it overlooks the regulations that are restraining it. The money has to come out of the right pot, whether for exhibitions or promotions or whatever. What is needed is the maximum flexibility to achieve as commercial an approach as possible. I hope that Food from Britain and the BOTB will work closely together. I am sure that will happen. It is essential that it should.

The main producer bodies—some to a greater extent than others—have conducted a powerful and successful marketing drive within the United Kingdom. They have done very well, but the picture is not the same with exports. It would not be unkind, in the majority of cases, to describe the position as a shambles. In Germany 40 per cent. of the money spent by the CMA is devoted to exports and 60 is spent per cent. internally. I am not sure about the French proportion. At one time 55 per cent. was spent on exports.

I hope that Food from Britain will place particular emphasis on the export drive. There will be a tremendous temptation among contributors to ensure that the home market is looked after and to see that this co-operative or that producer body gets its fair share. The fair shares route leads nowhere. What is needed is a strong, united global approach to selling food overseas. It is Food from Britain, not Food in Britain.

It is marvellous that the Secretary of State should have been able to get the money. Everyone cheers the £20 million over five years. I accept my right hon. Friend's point that most of the money is likely to be spent in the early years, tailing off in the latter years. However, it is not a large sum. The German budget is about £20 million a year and the French budget, where reorganisation has recently taken place, is knocking on for £12 million a year. In this country, in the current year to October, the Germans have spent nearly £500,000 on advertising in the press and on television. I should like to enter a caveat. I hope that I shall not be on the Standing Committee. Therefore, I shall make it now.

Mr. Norman Buchan (Renfrewshire, West)

The hon. Gentleman can expect to be serving on the Standing Committee now that he has spoken.

Mr. Silvester

I think that I might wriggle out of it.

Overseas experience suggests that getting away without any form of levy or compulsory contribution is a tricky exercise. I know that the food industry will not like what I have to say. However, I hope that the Minister will keep his options open. The need will not disappear. The United Kingdom will have to continue to promote its goods abroad. The industry, especially the processed food industry, will be highly fragmented. There are already many individual budgets on promotion which people will be reluctant to release. Some subscription or levy system may, in the end, be necessary. I hope that my right hon. Friend will think carefully before saying that everything will depend on the new organisation paying its way. In most countries, some kind of subvention will continue to be sought through the Government.

I join hon. Members in wishing the new organisation and the Bill every success.

7.3 pm

Mr. John Carlisle (Luton, West)

I am pleased to follow my hon. Friend the Member for Manchester, Withington (Mr. Silvester), who described himself as being in a unique position in that he represented virtually no one but himself and obviously his constituents. I declare an interest. I have been involved in the agricultural marketing trade for 20 years and still retain an interest. My remarks reflect, I think, the views of the United Kingdom Agricultural Supply Trade Association, which represents a large sector of the private grain trade.

My right hon. Friend will understand that, although my remarks may seem to be directed to a narrow sphere, they are nevertheless relevant to a part of the Bill. It is pleasant to see the Opposition joining the Government in welcoming the Bill. I also welcome the Bill, as does UKASTA. I was pleased to hear the hon. Member for Cardigan (Mr. Howells) talk about the aggressive spirit of marketing that is required, and several hon. Members have voiced similar opinions.

I sympathise with the hon. Member for Durham (Mr. Hughes) and his remarks about the appointment of the board on 7 June. The hon. Gentleman is right to bring to the attention of the House the fact that it might have been wiser for the Minister to wait until the Bill had started its passage through the House, or had actually been approved, before making the appointments, admirable though they are. It is nevertheless good to see the Opposition on our side.

I hope that it will not be seen as churlish criticism to introduce into this atmosphere of bonhomie the view that the Bill does not seem to recognise the importance of the private trade, especially in the grain sector. I hope that my right hon. Friend the Minister of State will be able to say a few words about that. There has been support for the co-operative movement, which obviously has an important role. I represent an industry which, in value terms, exports more agricultural products than any other sector. Of those exports, 85 per cent. come from the private sector. If the private sector had not made the investment and taken the initiative, mainly without Government support, we should not be in the happy position today of having the facilities to be able to export.

It would be less than honest of me not to admit that I view the departure of the central council with a jaundiced eye. During its existence it never gave much help to the private sector. It was involved in what might be called almost statutory discrimination against the private sector. The money that has gone into the co-operative and the group movement—I see my right hon. Friend beginning to squirm—has not changed since the Conservative Government came to power.

Those on the private side want to be recognised for what they have achieved in a traditional role. My right hon. Friend talked about the need for co-ordination of research. I remind him that vast sums of money have been spent by the private sector on research and development over many years, which has been recognised by his Department. This has helped British agriculture to achieve the position in which it stands today.

Enormous investments, some with Government help, have been made in storage and handling facilities. These have been to the mutual benefit of farmers and the trade. While the benefits of co-operation are appreciated, it is hoped that this apparent discrimination—it might comfort my right hon. Friend if I use that phrase—which seems to have operated in the past, will cease. Food from Britain must recognise, on the grain side—which is, in value terms the largest sector of British agriculture—the important part that has been played by the private trade and the important part that one hopes it will play as soon as the Bill becomes an Act, not only in the United Kingdom, but overseas.

Many hon. Members have rightly said that Food from Britain should play a major role in exporting goods as well as in improving marketing at home. We in the private sector look forward to co-operating with Food from Britain, and I hope that there will be a better recognition than hitherto of the work that has been done and the work that we intend to do in the future.

Because of the value of what we do and the value of the goods that we produce and market, we are disappointed that no member of the grain trade is to be appointed to the council. I understand that my right hon. Friend does not want too many members, and I realise the many and varied interests of those who wanted to get "in on the act", but we believe that the growing importance of the United Kingdom grain export trade merits some representation on the council of Food from Britain.

Despite that criticism, and despite certain misgivings on my part, we and UKASTA join many right hon. and hon. Members and people outside the House in wishing Food from Britain well, and we look forward to increasing and mutually beneficial co-operation in the years ahead.

7.11 pm

Mr. David Myles (Banff)

I join the hon. Member for Cardigan (Mr. Howells) and my hon. Friend the Member for Luton, West (Mr. Carlisle) in declaring an interest, in that, like the hon. Member for Cardigan, I am a hill farmer. I am also a director of a co-operative auction company. I would say to the hon. Member for Durham (Mr. Hughes) that, despite the fact that Douglas Cargill is the chairman of that co-operative, we have not received a grant from the central council.

I applaud the Minister for the enthusiasm that he has displayed since he took office and thank him for the part that he has played in the two answers to questions that I have had this week. First, I thank him for the reply that I had today on hill livestock compensatory allowances, from which I learnt that they are being maintained. That will give great encouragement to the hill farmers and primary producers such as the hon. Member for Cardigan. I thank him, too, for the part that he played in the reply that I received on Monday, about the deferment of duty on Scotch whisky. That news was greatly welcomed in the trade, and it will do much to help Scotch whisky exports and the cash flow in the industry.

Agriculture is Britain's biggest single industry. That is worth repeating. Its gross output value for 1981 was £9,615 million, compared with Australia and New Zealand combined—often thought of as major agriculture producers—with a figure of £7,819 million. For Canada, another big agriculture producer, the figure was £7,408 million in the same sterling terms. That shows the importance of British agriculture.

Given the situation that now exists in the European Community, where a number of agricultural products are now in surplus, this Government initiative to improve marketing is timeous. Although it is frequently claimed by both pro- and anti-Common Market advocates that the guarantees in the common agricultural policy have achieved those surpluses, in my opinion the CAP has had a very small influence in this respect. The influence has been greater of plant breeders, animal geneticists, the rapid adoption of new technologies and the increased use of fertilisers. In other words, the surpluses would have been there, whether we were in or out of Europe.

Our membership of the Community has undoubtedly helped us to cope with those surpluses in a manner that has kept our industry reasonably healthy. It has also helped Europe, on the one hand, to influence what is done with American surpluses so that they do not damage world markets for us, and on the other hand, to stimulate a more coherent policy in helping the hungry world.

The national co-ordination of marketing envisaged in the Bill is becoming increasingly necessary as our production increases, so that we are not disadvantaged in the markets of Europe, or indeed the world, where many of our competitors are better organised in this respect. It is perhaps worth while to demonstrate the effect that a body such as this can have on attitudes. When the Meat Promotion Executive was set up in about 1974, an AGB survey established that only 26 per cent. of housewives thought that beef was good value for money. After five years during which that body co-ordinated promotion, in 1979 a similar survey showed that 67 per cent. of housewives thought that beef was good value for money. In that period, 1974–79, the value of beef in real terms increased considerably.

I welcome the fact that Douglas Cargill is to be the vice-chairman of Food from Britain. He is an old friend of mine and a neighbouring farmer, but that is by chance. I hope I can say in a Scottish accent that I hope there will be a formula, or at least an understanding—we do not want the body to be set up in a statutory manner that is too rigid—that Scottish producers will always have a voice. That is even more relevant with the setting up of the Scottish farm and food group by the Scottish National Farmers Union. I welcome that initiative, too. Specific parts of the United Kingdom with distinctive products and markets should be adequately represented. I am happy to support the Bill, and the results that it hopes to achieve.

7.17 pm

Mr. Martin J. O'Neill (Clackmannan and East Stirlingshire)

We have had a useful debate and the Opposition welcome the Bill. Clearly, we do not welcome all its aspects, but we can ventilate in Committee some of the misgivings that I shall highlight now.

The role of agriculture, in terms of import substitution and in terms of exports, has been a great help to the British economy during the past five years. The figures quoted by the Minister speak for themselves. If we are to approach this subject in a spirit of co-operation, it would be churlish to claim credit for any Government, although it should be recognised that more than one Government have been responsible during that time.

We are in general sympathy with the terms of reference of the proposed board. We have no objection to the membership of the committee, in that we believe that people such as Mr. Saphir have proved their worth with the central council, and we are glad that there will be some continuity. I share the views of the hon. Member for Banff (Mr. Myles) about the suitability of Mr. Cargill and his acceptability to the National Farmers Union in Scotland. However, I should put on record the anxieties that were made a little more explicit by the NFU in Scotland than the hon. Member for Banff said. In a letter dated 29 September, the director and general secretary said to the Department of Agriculture and Fisheries for Scotland: The point I want to make is that whilst Douglas Cargill's appointment is very welcome indeed, we could in future scarcely count upon the appointment of a man so uniquely qualified to represent the Scottish co-operative and general farming interests even as an ordinary member of the Council, let alone as Deputy Chairman. It is for that reason that I am writing to urge the need as part of the new legislation for proper consultative procedures to be established.

The Labour Party is well known for its preoccupation with constitutional arrangements. In politics we have perhaps raised it to something approaching an art form and some of our skills may become evident in Committee, but we have to take account of the varying interests that must be represented on a body such as Food from Britain. Hon. Members on both sides have made claims on behalf of individual interests and I support my hon. Friends who represent the Co-operative Party.

My hon. Friend the Member for Harlow (Mr. Newens) traced the considerable contribution that the co-operative movement has made to agriculture over the years through the Plunkett Foundation. My hon. Friend the Member for Edmonton (Mr. Graham) referred to the dominance of the co-operative movement in its retail role in some areas. As food from Britain gets under way we shall hope to see that section of the production and retail sides given a voice.

The Minister made clear his appreciation of the co-operative movement's contribution, but only in response to an intervention. We would have been happier if he had expressed his appreciation in his initial remarks. It was inevitable that my hon. Friends would refer to the co-operative movement and the right hon. Gentleman should have anticipated their remarks.

However, I do not want churlishness to intrude into the debate, because it has been constructive. We shall want to return to the point made by the hon. Member for Manchester, Withington (Mr. Silvester) about finance. It is proposed that there should be a tapering of Government finance over the first five years, but we should welcome an acceptance of the fact that self-financing may not be as easy as the Minister suggested.

We shall seek to amend the Bill to give the Minister power to think again in the third or fourth year about alternative sources of finance. Perhaps the Government will have to continue funding the organisation. It would be better to amend the Bill rather than have to go through the cumbersome procedure of introducing fresh primary legislation to deal with the matter.

The hon. Members for Cardigan (Mr. Howells) and for Banff (Mr. Myles) mentioned Welsh and Scottish initiatives. No doubt both the Scots and the Welsh would claim that they were first, but I will not join in that argument. However, as regards regional representation or, in the case of Scotland and Wales, national representation, it is important to realise that there may be one or two areas that could give advice to Food from Britain and that they should be more formally represented on the council.

My hon. Friend the Member for Durham (Mr. Hughes) mentioned the six-month time lag between the announcement of the membership of the council and the Second Reading debate. We recognise the difficulties involved in the parliamentary timetable and we appreciate the Minister's enthusiasm for one of his pet projects, but if we manage to convince hon. Members of the desirability of amending the Bill it will be difficult to give effect to amendments because the Minister has, in effect, appointed members of the council in advance.

The hon. Member for Caithness and Sutherland (Mr. Maclennan) was right to refer to the promotion of sea fish. It would be useful to have clarification of the relationship between Food from Britain and the White Fish Authority. No doubt the hon. Member for Caithness and Sutherland will be an enthusiastic member of the Standing Committee and will seek to move an amendment to deal with the relationship between the two bodies. The official Opposition would view such an amendment sympathetically.

We are happy that Food from Britain has been set up. We recognise that the Agriculture Act 1967, passed by a Labour Government, went some way towards establishing more formal co-operation within agriculture. The central council has performed creditably and we welcome the fact that the chairman of the council has been appointed chairman of Food from Britain. It seems that he has been appointed with a standing-by status. It is almost like naming an embryo in anticipation of the child's birth.

The Labour Party has always supported co-operatives in agriculture. The previous Labour Government and my right hon. Friend the Member for Deptford (Mr. Silkin), the former Minister of Agriculture, sought to ensure a prominent role for marketing. The improvements in import substitution and the exporting of food have been largely due to the efforts of previous Labour Governments. We agree that from time to time there must be improvements and extensions, and we welcome the fact that Food from Britain is being built on the sound foundations established by a Labour Government.

We shall seek in Committee to achieve some minor alterations in the Bill. There is no lack of good will from the Minister; he has invested considerable personal prestige in the project. We hope that the follow-through of what has been a successful public relations exercise will benefit our agriculture, consumers, co-operatives and the public at large.

7.28 pm

The Minister of State, Ministry of Agriculture, Fisheries and Food (Mr. Alick Buchanan-Smith)

We have had a useful and constructive debate. It is pleasant to be associated with a Bill which has been broadly welcomed in a series of thoughtful speeches about the purposes of the Bill and the objectives of Food from Britain.

I am grateful to hon. Members for the welcome that they have given the Bill and I was glad to have confirmation from the hon. Member for Clackmannan and East Stirlingshire (Mr. O'Neill) that it is welcomed by the Opposition. We were in some doubt about that after the opening speech for the Opposition. However, I do not intend to say anything more about that other than that it was one of the least relevant contributions to the debate.

Many points of considerable importance have been mentioned today. I shall try to deal with one or two in greater detail tonight, although we shall be able to deal with many of them in Committee. Two main issues have emerged from the debate—co-operatives and membership of the new body. It is significant that co-operatives have been the central theme of almost every speech.

The new body, Food from Britain, takes over the role of the Central Council for Agricultural and Horticultural Co-operation. I have found tremendously encouraging the full and open tributes that all hon. Members have paid to the council. I pay tribute not only to the staff and the members of the council but to those who established the council in its early days. I am sure that the present membership and staff would like a tribute to be paid to those who went before them.

The central council has been rightly praised for its success. Therefore, I say straight away that the new body will not diminish in any way the role, purpose and functions which the central council has carried out so successfully over the years. The new body will continue to carry out its functions. I make that plain. It is clearly established in the Bill.

The functions of the central council were established by the Agriculture Act 1967. In section 58(2) one sees the purposes of the central council, which are not changed in any way by the Bill. If hon. Members read the repeals clause of the Bill, they will see that that section remains on the statute book and forms the basis for the continuing co-operative function of Food from Britain. The legal basis of the new body remains the same and will so continue.

Food from Britain will not diminish the work and drive of the co-operative work of the central council. It will take on the council's responsibilities for co-operation and, as has been said, it will continue to receive the same annual contributions from the Government for the exercise of those functions as the central council. I emphasise that that contribution is a continuing one. It is not subject to the five-year limit as are the marketing activities of Food from Britain.

Although discretion rests with Food from Britain, I understand that it will probably be the intention to continue to carry out co-operative functions under a co-operative development board which will be an integral part of Food from Britain. The deputy chairman-designate, Mr. Douglas Cargill, to whose abilities tribute has been paid, is foreseen as the chairman of that development board. Under the direction and drive of such an individual, we can have every confidence that the co-operative effort will be not diminished but sustained.

Mr. Buchan

We welcome the assurances that have been given and the suggestion of a co-operative development board. Surely, therefore, it is imperative that the functions and role of the new body are made explicit in the legislation, partly because one of the effects of the legislation will be to develop that role through the consciousness of people who are involved. Will the Minister address his mind to that before the Bill goes into Committee, as Labour Members will? It would be helpful too if the role of the new body could be seen not only to be underpinned by the Bill but made explicit in the way that has been set out.

Mr. Buchanan-Smith

I do not disagree with a word that the hon. Gentleman has said. It is already explicit in the Bill. Clause 2 makes it clear that the functions of the central council are transferred to Food from Britain. One cannot be more explicit than that, although one must read it with the provisions of the 1967 Act. I shall have an open mind to any improvements that may be suggested in Committee. However, on the legal advice that is available to me, I am clear that those functions are utterly undiminished by the Bill, but I should be happy to consider any suggestions that would make the matter more explicit. This an important matter, and it was referred to by my hon. Friend the Member for Devon, West (Sir P. Mills), the hon. Member for Cardigan (Mr. Howells), with all his experience of the WAOS in Wales, and also in a constructive speech by the hon. Member for Edmonton (Mr. Graham). We are all anxious that those functions should continue.

I go one stage further and say that the mere fact that Food for Britain is to have a positive and dynamic role in marketing and is to combine that with the work of the central council, means that co-operative work will be given a new status and drive, rather than diminished. That is how I see it and I hope that it will continue.

My hon. Friend the Member for Luton, West (Mr. Carlisle) struck a slightly contrary note. I understand what he says, and he has been consistent in making his views known. However, he is incorrect to distinguish between assistance for co-operatives and what may or may not be available for other enterprises—particularly the grain trade. After all, the private sector is involved as well. I am conscious of and sensitive to the points that he has made. They are matters which I and my Department watch carefully. The new body will rightly review its policies on co-operative grants from time to time and be ready to deal with any unfairness that may arise. I appreciate what my hon. Friend said, although I do not agree with all his views.

The hon. Member for Clackmannan and East Stirlingshire said that membership of the new body should be directly representative of different sections of the food industry. We had that argument two years ago when we introduced legislation for the new Sea Fish Industry Authority. The matter was debated fully in Committee then, and I have no doubt that it will again be debated fully in Committee.

As my right hon. Friend said, when we made the suggestion about the way in which the new body should be appointed, we did not come to a conclusion just by chance. We came to it after a great deal of thought and consultation. As many hon. Members have acknowledged, the Bill is the result of an enormous amount of research and much public debate in the past three and a half years. I can think of few Bills on which there has been as much public debate, and I am grateful to all those who have participated in it.

If we reflect on the make-up of our food industry, which was emphasised by my hon. Friends the Members for Manchester, Withington (Mr. Silvester) and for Thirsk and Malton (Mr. Spence), we find that we are dealing with an incredibly varied industry, ranging from production, through processors, merchants, wholesalers and retailers to companies with interests in exports. If, we sought to make the governing body of the new organisation completely representative of such a diverse industry we would end up with a numerical membership that would make the body unwieldy. It would be difficult to reach decisions, and that would detract from the essential dynamism that the body should have and which we wish it to have. We want a body that will be flexible in its operation. The way in which we have drawn up the membership gives greater flexibility and will lead to a better and more effective body.

I make it clear, as I did two years ago about the Sea Fish Industry Authority, that in making appointments to Food from Britain Ministers will take into account the variety of interests in the food industry, as we did with appointments to the Sea Fish Industry Authority. We shall take into account the representations that we receive from the many organisations and other bodies. I emphasise that it is impossible for all those who wish to be represented on the body to be appointed to it. I make it equally clear that, on the basis that we propose, we hope that those who serve on the body will not see themselves as delegates or representatives of a particular organisation or as part of the industry from which they come. We want them to bring to the body all their expertise, knowledge and experience. When they become members of the governing body they should bring to it their independent judgment on what is right and best for the food industry of the United Kingdom.

Having done that for the Sea Fish Industry Authority, which has been in being for just over a year, I am encouraged to think that the approach is better than that suggested by the Labour Party. I shall not enter into a Committee debate, although I am verging on that. It is obvious that hon. Members on both sides of the House believe that the matter is important. In preparation for the Committee stage, it is important that those who have contrary views to ours should know the basis of our views. I look forward to a more detailed debate in Committee.

Mr. Graham

Whether or not the membership of the council remains as it is now, does the Minister envisage that by the end of the five-year period the industry will be wholly responsible for funding the activities of the council? I make this point to the Minister as a politician. If the industry, particularly the retail industry, believes that its representations are not being met or that the people concerned do not have sufficient knowledge of the problems, difficulties will arise. Success depends on acceptance by the industry arid the people that what is being done in their name is being well done. One must have regard to representation as well as taxation.

Mr. Buchanan-Smith

I respect the hon. Gentleman's views, because he speaks with considerable experience. I shall take his views into account in Committee.

My hon. Friends the Members for Devon, West and for Harborough (Mr. Farr) referred to the meat industry. I know that they are interested in that. That sector is facing difficulties. My hon. Friend the Member for Devon, West asked whether the new body could do anything about slaughterhouses. That is a different issue, which must be dealt with in other ways. I hope that my hon. Friend is reassured by the active interest that has been taken by bodies such as the Meat and Livestock Commission, which has made proposals, which we are currently considering and which I hope the industry will consider. The initiative that my hon. Friend envisages for the new body is not appropriate. Other means should be sought.

The hon. Member for Caithness and Sutherland (Mr. Maclennan) referred to the marketing of sea fish. Its exclusion is intended, because the responsibility has been given to the Sea Fish Industry Authority. That is right, because the catching and landing of fish, which are part of the whole marketing process, are appropriate to a body such as the Sea Fish Industry Authority.

I accept that there is bound to be an overlap of responsibility between Food from Britain and the Sea Fish Industry Authority. I expect and hope—I have no reason to think otherwise—that the two bodies will co-operate to ensure that there is no duplication of activity, so that they make the best use of resources in the best interests of the marketing of British produce. I believe that one cannot avoid the overlap absolutely, but I hope that common sense will prevail to minimise the difficulties.

The hon. Member for Clackmannan and East Stirlingshire referred to Scotland. Initiatives have been taken in Scotland, for example by the Scottish Quality Lamb Association. I was going to say that that was one of the first initiatives, but as the hon. Member for Cardigan is present I realise that that is a dangerous thing to say to him, so I shall say that it was one of the early initiatives on a large scale for the better marketing of produce from our farms.

The Scottish NFU was represented on the British Agricultural Export Council working party which did a great deal of the basic work that led to these proposals. The president of the Scottish NFU has welcomed the establishment of Food from Britain and pledged it full support. The establishment of the Scottish farm and food group, to which my hon. Friend the Member for Banff (Mr. Myles) has rightly referred, is seen by the sponsors of that body as complementary to Food from Britain. I welcome its initiative, which I believe is good.

Mr. Mark Hughes

I asked a specific question about the payment of money to Food from Britain. I should be grateful for an answer.

Mr. Buchanan-Smith

I am happy to give the hon. Gentleman an answer. I should have asked the hon. Gentleman to take the trouble to read the press release earlier in the summer, which clearly spelt out the intention to invite various people to serve. Members have not been appointed to Food from Britain, and they will not be, and cannot be, until the Bill has been passed. They have not been paid. My right hon. Friend has asked those people to stand by to help prepare Food from Britain. If the House decides on different numbers or procedures, appointments to Food from Britain will be made on that basis. It could not be otherwise.

Discussions on this matter have taken place with all the interested parties for the past three and a half years. It was necessary that an important new enterprise such as this, which is of benefit to one of our great food industries, should have momentum and not get bogged down in procedure and just wait for things to happen. I believe that it was right for my right hon. Friend to take certain initiatives, because they have maintained the momentum and dynamism that a new project such as this requires.

I believe that the way in which we have proceeded has been generally warmly welcomed by those who have a direct interest in the food industry. Over the past three and a half years perhaps the greatest achievement of the Marketeers, to which my right hon. Friend referred, is that they have got rid of the feeling that each part of the industry, whether producer, processor, merchant or retailer, had to operate in small compartments. My hon. Friend the Member for Withington made that point also. I believe that our proposals are supported by the industry because it realises that each sector is an important link in the food chain. Those links are joined, and if any one is weak the whole chain is weak. If one suffers and does not join, the strength of the enterprise will be that much weaker.

It is in that spirit that we have proceeded and that the House has responded to the Bill. I hope that we shall go forward to the Committee stage with the same spirit to improve the Bill and bring into operation as soon as possible this new body not only in the interests of the British food industry but in the wider interests of the British economy.

Question put and agreed to.

Bill accordingly read a Second time.

Bill committed to a Standing Committee, pursuant to Standing Order No. 40 (Committal of Bills).

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