HC Deb 12 June 1986 vol 99 cc482-3
3. Mr. Geraint Howells

asked the Minister of Agriculture, Fisheries and Food what is his latest estimate of the likely effect of the European Community agriculture price agreement on the European Economic Community budget.

Mr. Jopling

The Commission has estimated that the agriculture price agreement for 1986–87 will reduce Community expenditure by 320 million ecu in 1986 and by 457 million ecu in 1987. At the same time, the Council agreed to cuts in the Community financing of intervention which will save an additional 300 million ecu a year.

Mr. Howells

I am grateful to the Minister for his reply. Does he agree that now is the opportune time to reform the way in which we market our surpluses within Europe, instead of selling beef to the Russians at a giveaway price? What plans has his Department put forward to the Commission to try to improve the situation?

Mr. Jopling

Over the years we have tried—this was probably true of the previous Government also — to argue in favour of policies which prevented these huge, unmarketable, unwanted and uneatable surpluses from being built up. That seems to be the right policy. As the hon. Gentleman knows, we have been extremely unhappy about the special sales, which are directed, for instance with butter and other products, at countries such as the Soviet Union.

Mr. Marlow

Is there not a simple way of solving the Community's financial problems? Is the Community not like any other organisation or person? Should it not say to itself at the beginning of each year that there is only a certain amount of money to spend on agriculture? If, perchance and sadly, it should go above that level of expenditure, could it not pass the hat round to those countries that spend the most money? If it needed surplus cash, could it not take it pro rata on the basis of where the money was spent? Would that not be a fair and sensible solution?

Mr. Jopling

If it came to what was a fair and sensible solution, my hon. Friend would probably scrap the whole Community. Of course, that is not the policy of the majority of hon. Members or of the Government. We have a financial guideline, as my hon. Friend knows perfectly well. In this year's price-fixing the financial guideline has been a major influence on the successful outcome of that price fixing process.

Mr. John

Does the Minister agree that the CAP budget for this year will be £800 million more than last year, despite what the Minister said is being saved? Even that is not a full statement of the problem. Ministers have sought to hide expenditure of between £300 million and £900 million this year and bury it in next year's accounts. We are talking therefore about between £1,000 million and £1,700 million more expenditure. The Agriculture Ministers are doing that to try to hide the poverty of their approach to the real problems of the CAP.

Mr. Jopling

The hon. Gentleman will recall that price fixing this year did respect the financial guideline. As he was shown, exceptional circumstances, in the view of the Commission, have led to a supplementary budget to be produced above the guideline, on the ground of the fall in the level of the United States dollar and the consequent increase in the amount of money which the Community needs to complete the programme.