Dairy Industry (Hansard, 29 March 1984)

§ 4. Mr. Robert Atkins
asked the Minister of Agriculture, Fisheries and Food whether he will consider a measure of transitional arrangements for dairy farmers in the proposed reduction in milk production.

§ Mr. Jopling
The agreement on restraining milk production provides for a transitional year in 1984–85, when the guaranteed quantity free of levy will be set at 98.2 million tonnes. In 1985–86 the quantity will fall to 97.2 million tonnes.

§ Mr. Atkins
Does my right hon. Friend not agree that any industry faced with a 10 per cent. cut in production and income merits special hardship compensation over a transitional period? Does he not accept that many farmers who have been encouraged in recent years to increase production are now feeling very concerned, particularly in view of the encouragement that came from CAP reviews and special schemes?

§ Mr. Jopling
The cut that is implicit in the transitional year which is about to begin is slightly more than 6 per cent., not 10 per cent. My hon. Friend should remember that one of the reasons for having to take these difficult steps, which I fully recognise as such, is that the Community has no more money at the moment.

§ Mr. Torney
Will the Minister confirm that, as usual, the United Kingdom will monitor the cuts in milk production that are forthcoming from the new EC proposals and monitor the super levy? Does he agree that other member countries in the Community are not so eager to do precisely that? Will he ensure that the Community sets up proper arrangements to monitor and administer the super levy in other countries as well as Britain?

§ Mr. Jopling
I appreciate what the hon. Gentleman says. All sales of milk are covered by the quota system, with no exemptions, for small producers, regions or off-farm sales, which could have benefited some countries at the expense of others, such as Britain. In discussions on the detailed application of the system we shall insist that the implementing measures are not discriminatory and can be properly enforced throughout the Community. I ask the hon. Gentleman to consider the new weapon of disallowance, which the Commission is becoming more and more accustomed to use.

§ Mr. Colin Shepherd
Is my right hon. Friend aware that there is considerable pleasure in the industry that the foreign side has had its direct sales drawn into the agreement and therefore the output fully reflects the proper output? As the system starts from next Monday and there is considerable uncertainty in the industry, can he give us some clue as to when the quota arrangements might be resolved?

§ Mr. Jopling
We are having urgent talks with the industry here about the implementation of these measures. Urgent talks are taking place in Brussels in the Special Committee on Agriculture. When I return to Brussels tomorrow, I expect that then and on Saturday we shall discuss again the measures to implement this scheme.

§ Mr. Maclennan
What special consideration has the Minister given to the predicament of milk producers in Northern Ireland, and has he made any proposals about that in the discussions?

§ Mr. Jopling
The hon. Gentleman will recall that in the debate a week ago today I spoke of the need for equal consideration to be given to the claims of Northern Ireland, and I spoke of this when I was in Brussels at the Council of Agriculture Ministers on Monday.

§ Sir Paul Hawkins
Does my right hon. Friend acknowledge that dairy farmers have had three years of warning of the great increase in the mountain of butter and dairy produce, and therefore that the call by the NFU president for a three-year phasing-in should be considered in relation to the warnings that farmers have had?

§ Mr. Jopling
The standard quantity to which we are working in the Community is 97.2 million tonnes, which is the 1981 figure plus 1 per cent. It is on that basis that the whole thing has been put. It was, of course, at that time that warnings were issued and the guarantee threshold was instituted to try to create a weapon to deal with overproduction.

§ Mr. Strang
As the Irish Government have made it clear that they will not accept these proposals, will the Minister tell the House whether it is his policy still to try to secure agreement on the basis of these proposals, or whether he will use this opportunity to achieve changes which will lead to a less severe effect on our own dairy industry?

§ Mr. Jopling
The hon. Gentleman will know that I have made it clear that the Irish demand for its expansion of milk production to be taken into account is unacceptable, and so it is.

§ Mr. Needham
Does my right hon. Friend not agree that the lot of the average dairy farmer is a hard and difficult one, and that although cutbacks may be inevitable they deserve the sympathy and support of the whole House in what looks to be an even harder and more difficult time in the future?

§ Mr. Jopling
I am grateful to my hon. Friend for those comments. He will recall that in the debate a week ago I expressed my understanding for the difficult decisions that have to be taken. The dairy industry has a difficult period ahead of it. We shall issue guidance to it and give what help we can as soon as possible after the arrangements are finalised.

Mr. Mark Hughes
Will the Minister recognise that throughout the House there is deep and growing concern about the damage that will be done to the dairy industry by these arrangements? Will he therefore inform the House, because we accept that the Community budget may be pressed, that it is within his power to double the suckler cow premium from £12.37 to £24.75, and that, in terms of maintaining beef from the dairy herd and the incomes of many of the marginal land dairy producers, this immense and immediate help is available for him to implement?

Mr. Joplng
To double the suckler cow subsidy will not help beef from the dairy herd. That is a different herd from the one that is being talked about in the arrangements. I shall certainly consider the level of the suckler cow subsidy when the time comes to do it.