HC Deb 09 February 1984 vol 53 cc1031-8

4.3 pm

The Minister of Agriculture, Fisheries and Food (Mr. Michael Jopling)

With permission, Mr. Speaker, I should like to make a statement.

With my hon. Friend the Minister of State, I represented the United Kingdom Government at the Council of Agriculture Ministers on 6 and 7 February. The Council had a first discussion of the Commission's proposals on agricultural prices for 1984. These were presented by the Commission with the earlier proposals for changes in the common agricultural policy. The Council had a detailed exchange of views but no decisions were taken. Officials will be carrying forward the work between now and the next Council at the end of the month.

The Council reached agreement on an import quota for 1984 of 50,000 tonnes of beef and veal for the processing industry. This is an important source of raw material for the processing industry. Given the opposition of some member states to these imports, it was a very satisfactory outcome to have reached this agreement so early in the year. Because of the continued opposition of some member states, there was no progress on new long-term arrangements for imports of New Zealand butter.

In a discussion of the Commission's new structure proposals, it was evident that a great deal more work is needed before decisions can be taken. No agreement was possible on the terms for a roll-over of the existing directives.

My agriculture colleagues and I recognise that producers cannot be left in a continuing state of uncertainty about claims and applications under the schemes concerned. I am, therefore, delighted to be able to inform the House that payments of the 1984 hill livestock compensatory allowances will begin immediately and that we shall also begin approvals of outstanding and new applications under the agriculture and horticulture development scheme, the farm and horticulture development scheme, the agriculture and horticulture co-operation scheme—for forage groups—and the farm structure (payment to outgoers) scheme.

Mr. Robert Hughes (Aberdeen, North)

I thank the Minister for his report on the discussions in Brussels. Does he accept that there is no prospect of any agreement until at least after the summit meeting at the end of this month?

Is it not the case that there are irreconcilable differences among member states which have implications beyond the argument about budget ceilings? Does he accept that a fundamental reform of the common agricultural policy is needed to include, among other things, the transfer of the financing of agricultural support from the hard-pressed consumer to the taxpayer and a move towards more direct support for small farms?

The CAP is now clearly failing on all counts. It is certainly not helping consumers and it is not equitable among farmers. What is the Minister doing to pursue real reform, as it is not good enough simply to stand on the budget ceiling? The agreement on New Zealand imports expires at the end of this month. I hope the Minister will understand that no part of the House will accept any major reductions in the quantity as a reasonable conclusion at his next meeting.

In regard to positive monetary compensatory amounts, I am sure that the comment of the Minister's erstwhile colleague Mr. Tugendhat has not escaped him. He said bluntly that United Kingdom food prices have been higher than the Community level by at least 5 per cent. and that that is a self-imposed food tax. Will he remember that his departmental brief covers food as well as agriculture and that he has a clear duty to the consumer?

Will the right hon. Gentleman take the opportunity to discuss yet again with M. Rocard the illegal delays to British meat exports to France and make it clear that those intolerable circumstances must be ended for all time? Will he accept that, as the problems of high cereal feed prices are common to all pig importing producers, including our own, they demonstrate an inherent weakness in the CAP? Is he aware that he will have our support if he seeks a reduction in cereal support prices?

I am sure that the announcement of the decision to pay hill livestock compensatory allowances and the schemes that he mentioned will be received with widespread satisfaction. I congratulate the Minister on having fought off the Treasury.

Mr. Jopling

I shall begin by answering the last of many points. I thank the hon. Gentleman for his kind words. The resumption of payments of the hill livestock compensatory allowances will be widely welcomed throughout the country. I disagree with him when he says that there is no prospect of a deal on these matters before the European summit in the middle of March. We shall be doing everything possible to achieve that. There is unanimity in the Council of Agriculture Ministers that that needs to be done.

We are working for a fundamental reform of the CAP on the basis of the post-Stuttgart discussions and Community document No. 500. I note the hon. Gentleman's familiar cry that the task of supporting agriculture should be moved from the consumer to the taxpayer. I remind the world at large that the Labour party's policy on this matter would put up taxes by £2.25 billion a year, and I hope that that will be remembered.

We are keen to get a long-term agreement with regard to New Zealand butter. The hon. Gentleman will recall that the Commission has proposed a long-term deal over five years, and we shall do our best to get a deal which is satisfactory from the New Zealand point of view.

As to the MCAs, I repeat what I told the House this time last week, that the proposals which the Commission has put before the Council in the 1984 price proposals are unacceptable to the United Kingdom Government.

The hon. Gentleman spoke of the action of French farmers at the ports. I was in discussion with M. Rocard during the week and I am glad that the demonstrations by French farmers which began on Sunday and which have continued over the past three days appear to be over and that there have been no confirmed reports of any significant delays to British meat.

Finally, the hon. Gentleman raised the matter of cereal prices. I assure him that I continue to press the Council for a reduction in cereal prices so that the imbalance between the cereal and the livestock sectors can be redressed.

Sir Peter Mills (Torridge and Devon, West)

I congratulate my right hon. Friend on allowing the hill livestock compensatory allowance to be paid. This will assist the hard-pressed people in the uplands. I remind him —although, having known him for a long time, I know that he does not need reminding—that agriculture is not something that can be turned off and on like a tap, but needs long-term planning. It takes nine months to produce a calf. Therefore, will he ensure that, as quickly as possible, we have decisions on the price arrangements, otherwise confidence in agriculture could deteriorate?

Mr. Jopling

I am grateful to my hon. Friend for his earlier remarks about the resumption of the hill farm subsidy. I agree that there is need for urgency in settling the outstanding matters before the Council. There is cause for optimism, because all my colleagues on the Council are also anxious to put an end as soon as possible to the uncertainty that bedevils the whole of European agriculture.

Mr. A. J. Beith (Berwick-upon-Tweed)

Will the Minister accept our unreserved welcome for the decision on compensatory allowances, which was pressed for from the Liberal Bench during Agriculture questions last week? Does he recognise that it is important to make progress on the directives which are not being coiled over this year, particularly in view of declining farm profitability, which has attracted far less notice and attention than the increase in profits in recent years?

Mr. Jopling

I am grateful for the hon. Gentleman's remarks about the hill farm subsidy. Some of the other directives need a great deal of work. In many ways they are unsatisfactory to this country, and I am sure that he would not expect me to make a bad deal in a hurry.

Sir Paul Bryan (Boothferry)

As background to this scene, does my right hon. Friend agree with the latest National Farmers Union figures, which show that farming income declined by 15 per cent. in 1983 and is 30 per cent. down on the average for the 10 years 1972–1983?

Mr. Jopling

Yes, I accept that figure, which the NFU got from my Department's White Paper issued a week or so ago.

Mr. Thomas Torney (Bradford, South)

In view of the action by French farmers to try to stop supplies of our meat going into France last weekend, and the behaviour of the French police, who did nothing to stop French farmers searching lorries, what guarantees can the Minister give the House that this will not happen again? Has he seriously considered taking retaliatory action, bearing in mind that action is the only thing that the French seem to understand, and France exports much food here?

Mr. Jopling

The circumstances of this week do not necessitate retaliation. As far as I can see, there are no confirmed reports of any significant delay to British meat. As I understand it, one British driver, employed by a Northern Ireland haulage firm to drive meat from the Irish Republic, was involved in an incident which was reported in the media. It appears that this driver had cleared customs at Calais early in the morning on Friday and had parked his lorry outside the port and gone to sleep. He was found by demonstrators, and then made his way back to port in this lorry. He was able to leave with his lorry and his load in the evening under police protection. That incident does not give us grounds for retaliation.

Rev. Ian Paisley (Antrim, North)

Will the right hon. Gentleman take it from me that his announcement about the hill farm subsidies will be heartily welcomed in Northern Ireland, because many hill farmers have been budgeting for this money and need it to keep going on their small family farms? Keeping in mind the cereal problem, will the Minister take on board the representations made to him about having an intervention store in Northern Ireland for grain so that the intensive sectors of Northern Ireland agriculture—poultry and pigs—can have some alleviation of their problems?

Mr. Jopling

I am grateful for the hon. Gentleman's earlier remarks and I can tell him and others that the first cheques will be in the post tomorrow. With regard to cereals, I have often told the House that there is an imbalance between the cereal and livestock sectors and we are taking every possible opportunity to redress that balance and give assistance to the hard-pressed livestock sector.

Mr. James Nicholson (Newry and Armagh)

I congratulate the Minister on his wise decision to allow the HLCA payments, but I press him to bear in mind the time that farmers have to wait until they know what they will get for any particular commodity in the future year, which seems to come later than normal year after year. This uncertainty is causing more alarm in agriculture and I should like to see an end to it.

Mr. Jopling

I am grateful for the earlier parts of the hon. Gentleman's remarks. I can only reply to his comments at the end of his question by reminding him of what I said to my hon. Friend the Member for Torridge and Devon, West (Sir P. Mills), which is that I am aware of the uncertainty and that there is nothing worse than uncertainty in the agriculture industry. Farmers have the right to know as soon as possible where they are, so that they can plan for the future.

Mr. Robin Maxwell-Hyslop (Tiverton)

I welcome my right hon. Friend's announcement about the resumption of payments of grants and draw especially to his attention the report by Exeter university department of agriculture and economics on farm incomes, and in particular the parlous position of sheep farmers who are not in hill farming areas and the necessity to make it clear to the Council of Ministers that any proposal to limit support to 25 per cent. of the full market price would be unacceptable because it would be worthless to the industry.

Mr. Jopling

I am again grateful for my hon. Friend's opening remarks, and I regret to say that I have not yet had the chance to see the report from the Exeter university on these matters, but I shall make sure that it is drawn to my attention.

With regard to the Commission's proposals for a 25 per cent. ceiling on the premiums that are payable for sheepmeat, while that is something—[Interruption.] I always understood that it was the thing to do to address you in the Chair, Mr. Speaker. One aspect of that proposal which is not acceptable, however, is that any money that is saved by putting a 25 per cent. ceiling on the sheep premium under the Commission's proposals does not come back to the industry through the annual ewe premium. The United Kingdom would have a markedly inferior system of support to that which all other countries in the Community would enjoy, and that is unacceptable.

Mr. Allan Rogers (Rhondda)

May I congratulate the Minister on his visual gymnastics and at the same time ask him whether he will press upon his Cabinet colleagues the need to be as assiduous and hardworking for the industries which are their responsibility as he is for the industry which is his responsibility, and which seems to be looked after very well?

Faced with German opposition to the MCAs and the suggestion that if the Germans are fixed up in the messy farm price-fixing round that is taking place, the other countries can devalue their green currencies to fit in with the German format, which will lead inevitably to substantial price rises in this country, what will the Minister do to protect the British consumer? I ask the Minister not to reply with the platitude that the taxpayer is paying, but to remember that the consumers of this country, many of whom do not pay tax because they are on the dole, and many of whom are old-age pensioners on fixed incomes, have to pay the same for their food as the hon. Gentlemen behind him who live in the stockbroker belts of south-east England. When will you look after the ordinary people of this country who find that their incomes are declining while you are making sure that your farmer friends are feather-bedded?

Mr. Speaker

Order. The hon. Member has been a Member of the House long enough not to involve me in these matters.

Mr. Jopling

When the hon. Gentleman began his question, Mr. Speaker, I was going to ask you whether there was any precedent for Ministers to have Parliamentary Private Secretaries on the Opposition Benches, but I thought that the standard of the hon. Gentleman's question tailed off later.

On the question of MCAs and the position of Germany, this is an argument principally between France and Germany at present, but it has serious implications which, as I have said, are unacceptable. On the position of the consumer, if the hon. Gentleman will be good enough to look at the figures he will see that in recent years the cost of food in this country has been rising at a slower rate than prices in general. It is no good the hon. Gentleman holding his arms open. That is the truth. If he likes to put down a question, I shall provide him with the exact figures to demonstrate that what I say is true.

Several Hon. Members


Mr. Speaker

Order. I have already told the House that we have an important debate to follow. I propose to allow questions to continue until 4.30 pm, at which time we must proceed with the next business.

Sir Hector Monro (Dumfries)

I congratulate my right hon. Friend on the determined way in which he and his colleagues have been representing the British interests in Europe. I add my welcome to his decision to pay the HLCA and other grants, which will be particularly valuable to the hill farmers who faced such severe weather this winter.

Mr. Jopling

I am grateful to my hon. Friend for what he has said. I am glad that we have been able to get these payments resumed because of the difficulties that many hill farmers have suffered in the recent bad weather conditions.

Mr. Robert Maclennan (Caithness and Sutherland)

I thank the Minister and express appreciation for the payment of these compensatory allowances and other grants, but can he say, in elaboration of what he said to his hon. Friend the Member for Torridge and Devon, West (Sir Peter Mills), what positive proposals the Government are putting forward to ensure longer-term security for the agriculture industry? Will he consider in particular the principle of a quantitative reduction of price support, instead of the prudent pricing policy for cereals, which his predecessors so notably failed to make work?

Mr. Jopling

I am grateful to the hon. Gentleman for his kind words. He asked what proposals the Government were putting forward. I refer him to the debate in the House before Christmas on Commission document No. 500, which was published at the end of July. Our position has not changed fundamentally from that, except that I have continued to argue in the Council of Ministers that the best way of dealing with the long-term problems faced by the Community is to use the discipline of price. That is the best way to deal with over-production.

Mr. Michael Latham (Rutland and Melton)

When my right hon. Friend says that the MCA proposals currently on the table are unacceptable, does he mean that he seeks to oppose the revaluation of the green pound?

Mr. Jopling

I am saying that we are not prepared to accept the proposals which the Commission has put on the table for reducing the current level of MCAs, which stands at approximately plus 7.6. The Commission appears to have misunderstood, and not applied itself to, the fact that the United Kingdom has a floating currency. Within the course of the last year, therefore, the MCA level has varied from minus 1.1 at the beginning of last year to the present position of plus 7.6. To make an arbitrary change in the level of MCAs on the basis of one short period of time at the end of the year seems to us unacceptable.

Mr. Andy Stewart (Sherwood)

I welcome the Minister's statement, but will the quota that he has allowed for the meat processing industry not pose another threat to the dairy farmers who depend on that market for their culled cows?

Mr. Jopling

I can give that assurance, because I am told constantly by the canning industry that the preferred type of beef comes from cows that are much older, tougher and leaner than the cows that are available for purchase in this country. I find this argument incomprehensible. I am assured that the type of cow available in this country is not the product required for the canning process in question.

Mr. Tony Marlow (Northampton, North)

Can my right hon. Friend tell the House by what instrument, either United Kingdom or European, he is making the payments, how much is involved, and whether he will get the money back from the Community? Can he clarify the point about deficiency payments so that a certain mythology is not built up? Would it not be the case that if we went to a system of deficiency payments not only would certain CAP moneys be available, but food prices would come down, people would have more money in their pockets, and we would be able to buy cheap food on the world market? As a result, the total cost to the consumer and the taxpayer would be incontrovertibly less than it is currently.

Mr. Jopling

My hon. Friend has raised a number of matters over which I would take issue with him.

If I may take his last point, to think that one could replace home-grown food with food from overseas at the current price on the world market is to misunderstand the way that world trade works. I believe that we would find ourselves with volatile food prices and volatile supplies of food.

As to the payment of hill subsidies, the total cost is £94 million for hill livestock and agricultural and horticultural scheme payments. The FEOGA contribution is about 25 per cent. As I said, the cheques will be in the post tomorrow.

Mr. Nicholas Fairbairn (Perth and Kinross)

May I ask the Minister to remind the House, and in particular to remind Mr. Tugendhat, that only a small proportion of the cost of food goes to the farmer, the majority going to the distributor and the various outlets? Such remarks as Mr. Tugendhat has made are unhelpful when agriculture faces a stormy passage in the near future.

Mr. Jopling

I am sure that Mr. Tugendhat reads Hansard regularly, and I hope that he will read my hon. Friend's remarks. When I next meet him I shall take the opportunity to remind him of the excellent value of British food to the British consumer.

Mr. Albert McQuarrie (Banff and Buchan)

I do not know whether my right hon. Friend will treat as a joke the egotistical remarks of the hon. Member for Berwick-upon-Tweed (Mr. Beith). Indeed, I wonder whether, as a result of pressure from the Liberal Bench, my right hon. Friend came to the Dispatch Box to give such welcome news, particularly to the Scottish farmers, on the payment of the hill livestock compensatory allowances. Can my right hon. Friend advise the House whether it is intended that the figure payable will be the total payment negotiated in November 1983, or will it be only the United Kingdom element of the hill livestock compensatory allowances?

Mr. Jopling

I can give my hon. Friend the assurance that the full amount will be paid.

Mr. Mark Hughes (City of Durham)

Will you assure the House, Mr. Speaker, that you are prepared to receive statements or comments from a Member of Parliament whose motionless lips, like a ventriloquist's, appear to be 3 in behind his left ear when he is addressing the House? Will you also confirm that it is unacceptable for a Minister to turn his back on the Opposition Front Bench and address—

Mr. Speaker

Order. I think that that is an unnecessary allegation. I frequently see Ministers revolve so that they can address Back Benchers and then revolve back to address me.

Mr. Hughes

I concede that a revolving Jopling is, therefore, acceptable. However, the Minister's comments about the MCAs are wholly unacceptable. To impose an unnecessary food tax on this country—

Sir Peter Mills

What happened under a Labour Government?

Mr. Hughes

We did it the other way, and are proud of it. We object to the imposition of an unnecessary food tax and to the suggestion that it is wholly desirable that the £2.5 million should fall on consumers rather than on taxpayers. It is far better that the taxpayer, who is progressively taxed, should pay it than that the consumer, who is regressively taxed, should have to do so.

Mr. Jopling

I am astonished that the hon. Gentlaman should have the temerity to get to his feet and talk about food prices increasing under this Administration, when in the years until 1979, under a Labour Administration, the price of food more than doubled. I am astonished that the hon. Gentleman should have the temerity to criticise us about that. We have an excellent record on food prices. They have increased more slowly than prices generally. I hope that that is the last that we shall hear from the Opposition about them.