HC Deb 22 July 1991 vol 195 cc992-1004

8.3 am

Mr. William Hague (Richmond, Yorks)

I am pleased to be able to raise the subject of the European Community agricultural policy. I am grateful to my hon. Friend the Parliamentary Secretary for being here to reply to the debate. This subject is of vital concern to my constituents and many thousands of others throughout the country who work in agriculture or depend on it in some way. It should be of concern to all those who believe that food should be produced efficiently, that trade between the nations of the Community should be fair, and that our rural environment should be well looked after and preserved.

I raise the subject now because the launch of a new set of agricultural policy proposals by the European Commissioner, Mr. MacSharry, has brought discussion about future agricultural policy to a critical point, and because these discussions inevitably have implications for the success of the GATT round to which my right hon. Friend the Prime Minister and his colleagues among the G7 leaders have committed themselves.

The debate in the Community is only the latest in a long fight to reform the inefficient and wasteful common agricultural policy that has already gone on for years. In the 1980s, we took a leading role in arguing for reform, often in the face of unrelieved complacency and a near-paralysis of decision-making in the highest councils of the Community. Now, at least, the need for change is being more widely recognised, as continuing budget pressures and the demands of the GATT negotiations finally force some sense into the collective mind of the Community's agricultural policy makers.

How the Community responds to those pressures is important. The agricultural policy that emerges from the next few months will constitute a significant statement about—and an indication of—the sort of entity that the Community will be. Will it be open, fair and competitive, or protectionist, closed and discriminatory? The danger now is that the Community will adopt an agricultural policy that favours the inefficient, high-cost producer at the expense of the efficient, low-cost producer and that, in doing so, it will damage the interests of Europe's agricultural industry and its consumers and the cause of more open and effective competition around the world.

In particular, there is a danger that the Commission's proposals will discriminate against, and disadvantage, the average British farmer simply because he tends to be more efficient and to develop his business on a more viable scale and has adapted to changing circumstances more effectively than his average continental counterpart.

Dame EIaine Kellett-Bowman (Lancaster)

Is not one of the difficulties the definition of family farms? Many of our farms have a number of people living and working on them—a father, a couple of sons and often a daughter. They are quite small units, but because they are all under one umbrella they are subject to all the disadvantages that MacSharry is trying to wish on them now—or would have, if we did not have a very effective Minister who will fight for us.

Mr. Hague

My hon. Friend is absolutely right. On many British farms several generations, or different branches of a family, work together. Such families have been penalised in the past by Community arrangements and they will be penalised still further by some of the proposals that are on the table now.

The danger to which I have referred is nothing new. Britain joined the European Community too late and the agricultural policy that was already in place when we joined was tilted towards the small farmer and, in general, the continental farmer. The common agricultural policy pursued by the Community before we joined—and ever since—has led to more expensive food, the production and costly storage of huge unwanted surpluses and the maintenance of many tiny, uneconomic, part-time farms in continental Europe, which add to the surpluses at the expense of the taxpayer and to the detriment of larger, more efficient and more professional farming businesses around the Community.

One would have thought that the GATT round presented an opportunity for the Community to break with the inefficiencies of the past. As the whole world looked to freer competition and fairer trade, surely the Community would move in step with the times. In almost every other industry, the Commission is busily at work ensuring fair competition, reducing state aids and insisting that industries learn to compete on equal terms. Not so in agriculture.

Mr. MacSharry's latest proposals go deliberately and unerringly in the opposite direction from the policies set by the Commission for other industries and the policies that the whole world seeks for agriculture. His proposals would indeed cut the support prices offered to European farmers for most of their products; but they would go on to compensate fully all farms below a certain size for the reductions envisaged—and possibly do more than fully compensate them. They would also discriminate against the largest and most efficient farmers and probably lead to a further growth in the budget required to carry the common agricultural policy, without any significant benefits for the consumer of for the farmer who runs a sound business.

The proposals must be fiercely opposed and I am delighted to learn that my right hon. and hon. Friends in the Ministry have opposed them vociferously. I hope that they will continue to do so. Let us look at a few examples of what the proposals could mean.

The Commission proposes to reduce the intervention price for cereals by about 35 per cent. Compensation per hectare would be paid to farmers to help them to withstand the cut, but to qualify for payments a farmer would have to enter a set-aside scheme. Here is the rub: a farmer producing less than 92 tonnes per year would be exempt from the set-aside obligation. On United Kingdom farms, the compensation payments for set-aside would effectively be limited to the first 6 hectares, with the rest unpaid.

The net result would be severe discrimination against the larger farms. The National Farmers Union has calculated that a small arable farm of 15.6 hectares would suffer a 2 per cent. loss of income as a result of the proposals, while a 100 hectare farm would suffer a 28 per cent. loss. As farm size increases, the fall in income becomes more severe. The National Farmers Union estimates that United Kingdom cereals production would fall by about 2.5 million tonnes—a 10 per cent. cut out of a normal output of about 24 million tonnes. The total cost of this policy for the whole of the European Community would be additional payments of thousands of millions of pounds, mainly going to small farms on the continent, which are not economically viable units anyway, and keeping them for ever in competition with the less subsidised farms in this country that can produce cereal products more cheaply for the consumer.

The cereals policy is bad enough, but it is only the beginning. In the milk sector there would be a 10 per cent. cut in intervention prices and a 4 per cent. quota cut, but compensation would be paid—this is the problem—on the first 40 cows. Once again the result would be to disadvantage severely the large farmer and, therefore, generally the British farmer. European Community expenditure on the milk sector could rise by up to £500 million a year, if these proposals are implemented. The extra money once again would go to the tiniest farms.

The NFU has again estimated the implications for farms of different size. Its estimates show that a small farm with 30 cows would be 6 per cent. better off, that an average dairy herd of 70 cows would leave its owner 12 per cent. worse off and that a herd of 140 cows would mean a 25 per cent. reduction in income. That is even after allowing for the reduced cereal prices resulting from the measures already discussed. Once again the successful farmer who has expanded his business would suffer. The one who had sat on his hands and collected his subsidies each year would, yet again, be better off. That cannot be the right policy to take European agriculture into the 21st century.

The greatest horrors are still to come. These are the implications for the livestock sector to which I, representing the hill farmers of the Yorkshire dales, take particular exception. For one thing, the reductions in cereals prices are likely to encourage increased production of poultry and pigmeat. That would mean a reduction in the price for these products, which in turn would exert a downward pressure on the price of beef and sheepmeat. Paradoxically, the result could be increasing surpluses of beef and rising intervention stocks, producing yet more expense for the taxpayer.

Mr. Andy Stewart (Sherwood)

I thank my hon. Friend for introducing this debate on behalf of the farmers of this country. It is high time that the points he is making were brought out so that they are understood. There is a myth that the common agricultural policy is costing the average family £17 a week. Do my hon. Friend and Mr. MacSharry honestly believe that, by reducing output and prices, prices to the consumer will be reduced?

Mr. Hague

My hon. Friend has made an extremely valid point. Any analysis of the proposals now before the Council of Ministers does not lead to the immediate conclusion that prices to the consumer would fall. However, expense to the consumer and taxpayer has every chance of increasing.

I was examining the possible consequences for the livestock sector and how beef surpluses might increase still further. On top of all that, a 15 per cent. intervention price cut is proposed for beef and veal. We can reasonably expect sheepmeat prices to fall by about the same proportion. In addition, the Commission's proposals would limit the number of sheep eligible for the ewe premium on each holding to 350, instead of 500, and to 750 in the less-favoured areas, instead of 1,000. The result for livestock farmers in the less-favoured areas would be a fall in income of 26 per cent. on average and a staggering 43 per cent. fall in the lowlands. Such reductions would mean the abandonment of large parts of the British countryside and the dereliction of much of our finest rural landscape. Arid for what? The policy would need £500 million in additional ewe premium and £600 million in additional suckler cow premium. What sort of saving would be made in the face of such increases in costs?

We can see, therefore, that British agriculture would suffer considerably from these proposals, without the British taxpayer gaining much in return. The people who are best at producing our cereals, milk and livestock would all be hard hit, yet farmers of some other products in the Community would not need to lose a moment's sleep over what is proposed. If a farmer produces olive oil, he can rest easy. A fruit farmer need not worry. These are areas where the Commission believes that it would not be right to reopen the debate, given that so-called comprehensive changes have been agreed recently. In reality, the producers of southern Europe are left alone while northern European producers are expected to bear the burden of the Commission's policy in price cuts and tax.

To be fair to the Commission, its policy incorporates reasonable proposals that are by no means as lunatic as those that I have listed. It has introduced a number of schemes to aid environment, including an extensification scheme, an environmentally friendly management scheme and a scheme for the environmental upkeep of abandoned land. It also proposes an afforestation scheme and an early retirement scheme, which in principle are not bad ideas. Much of the help that it proposes needs to be less indiscriminate and more carefully targeted, but let us at least give it credit for those measures.

Nevertheless, Britain should fight the overall proposal all the way. Mr. Rodney Swarbrick, president of the Country Landowners Association, put it well in his letter to The Times last week. He said of the proposal: It attempts to throw the whole process of economic development into reverse. Mr. MacSharry has openly stated that his objective is to retain the maximum number of farmers on the land, the great majority of whom in his own words could never be described as competitive or viable. He, therefore, proposes that billions of extra ECUs of taxpayers' money should be spent to preserve an antiquated EC agricultural structure. Worse, the heavily subsidised production from these farmers will compete with the unsubsidised production of those bearing the brunt of the discrimination in his proposals and facing keener world markets after a GATT settlement. This can only lessen the viability and competitiveness of EC agriculture in precisely those areas where these qualities are most needed. There can be no economic rationale for this. It removes the much needed incentive for structural reform of European agriculture and the CAP budget implications would be colossal. That is a good summary of the position. I hope that Ministers will do their utmost to persuade their counterparts on the continent that this cannot be the right way to proceed. We need price cuts in the GATT deal—but cuts which mean that efficiency pays and which take place at a pace that the efficient farmer can withstand.

We must ensure that new European policies will not lead to huge expense and mountains of surpluses. They must therefore exclude the blanket subsidies to every part-time farmer in Europe, as envisaged by Mr. MacSharry. They should make environmental considerations a more integral part of the policy, with set-aside linked to provision for environmental protection and more selective direct payments for delivering specified and valuable care for the countryside or for those who maintain the finest rural environment in the face of permanent handicaps imposed by climate or geography such as in the less-favoured areas of the United Kingdom.

Dame EIaine Kellett-Bowman

The stone walls.

Mr. Hague

My hon. Friend refers to the stone walls of northern England. They would soon be gone without the farmers who work in those areas.

Surely the Commission can be brought to see that the policies that it proposes are a futile retreat before the advance of economic reality and a terrible advertisement for the Community and the principles on which it operates. To have a sound future, the Community must be fair to all its citizens, must bring the best out of its industries and must encourage its people, who can compete successfully with anyone else in the world. With its ludicrous agricultural proposals, it is being true to none of those objectives and I implore my hon. Friend the Minister and his colleagues to do all that they can to ensure that the proposals end up in the waste bin, where they properly belong.

8.18 am
Mr. Peter L. Pike (Burnley)

I congratulate the hon. Member for Richmond, Yorks (Mr. Hague) on giving us the opportunity to discuss these important issues. The MacSharry proposals are important to people who are involved in agriculture and farming. More farmers are leaving the industry than at any time since the war, which is of grave concern to many parts of the country.

The hon. Member for Richmond, Yorks referred to the need to reach agreement on reform of the CAP and the subsidy to agriculture because of the importance of reaching a conclusion on the GATT round. We all acknowledge the importance of that for Britain's trade in manufactured goods and other commodities. The two points are linked and the hon. Gentleman was right to draw attention to that. We also recognise the importance of that.

Another reason why it is important that we should discuss these issues and why any reform of the CAP is of extreme importance is that we face changes within the European Community that we may not have envisaged two or three years ago. Many eastern European countries may come into the EC before the turn of the century. We must have policies dealing with agriculture that will recognise the completely changed situation when other countries come in. We have already absorbed East Germany; it was incorporated into West Germany and became a united Germany, which we welcomed so much only a year ago.

When we recognise that countries such as Romania and all the other eastern European countries may enter the Community before the turn of the century and that before the war cereal production in Romania was second only to that of the Ukraine in European output, we recognise the implications for change. We have the opportunity of having policies that meet the needs now, allow us to reach agreement on the general agreement on tariffs and trade and take account of the rapidly changing situations which many of us welcome. I believe that it is in the interests of Europe and the world that other countries are admitted to the EC as soon as they meet the criteria.

There is widespread opposition—which we share—to the MacSharry proposals and there is concern about them not only in this country, but in the other countries of Europe. Many farmers are very canny people. Some whom I have met suspect that, because there is such widespread opposition, by the quirks of the way in which the Community works, the proposals may go through. We must reassure farmers that we will ensure that we get a better and more acceptable arrangement not only for those who are involved in agriculture, but for the consumers and the country generally.

When the Minister of Agriculture, Fisheries and Food answered questions last week, he made his position clear. In reply to questions, he said: I will then place on record again our opposition to those parts of the MacSharry plan that discriminate against British agriculture, northern agriculture, specialist agriculture, efficient agriculture, the interests of the consumer, European agricultural ability to compete with the rest of the world, and use reform not to reform agriculture itself, but to put forward Mr. MacSharry's personal views."—[Official Report, 18 July 1991; Vol. 195, c. 488.] The hon. Member for Richmond, Yorks emphasised that point.

The Opposition and the farmers want to hear exactly what the Government believe should be done. [Interruption.] When we sit on the Government Benches, we shall be glad to say exactly what our position is. In all seriousness, we want to hear what the Minister proposes.

I draw attention to one item—the subsidy for tobacco. Some £1 billion is given as a subsidy for the benefit of two member states of the EC that produce a tobacco of unusable quality. That seems nonsense. It has been said that we want to spend money on research to develop more usable tobaccos. I am a smoker, so I am not anti-smoking, although I know that I should give up. It seems nonsense when other sections of the Community are leading campaigns to stop advertising and to discourage smoking altogether. I believe that most people would argue that to subsidise tobacco from Community funds is nonsense.

Dame EIaine Kellett-Bowman

The hon. Gentleman has raised an excellent point. It was absolutely crazy to spend money on producing tobacco which nobody smoked and which went straight into store.

Mr. Pike

I am grateful to the hon. Lady for underlining a point on which there is universal agreement.

The present agricultural policy costs the average family of four in this country £16 a week. We pay £23 billion for storage, disposal of surplus and export refunds. That money does not go to the farmer. People would be extremely surprised to learn that 60 per cent. plus of the budget does not go to the farmer. It goes to the intermediary. We do not have a cheap food policy either, which is another nonsense.

The price of sheep in cash terms is less now than it was a few years ago. If one allows for inflation, however, the price in real terms is even worse. Many sheep farmers work difficult land and they are finding it hard to manage. In the supermarket the price of lamb is no cheaper than it was all those years ago. The farmer is therefore entitled to ask where the difference in price goes.

I know that the Minister visited the Trough of Rowland last week. Last year a number of colleagues and I visited a number of farms as part of an all-party tour. Those farmers gave us the relative figures on what they received in subsidy and what they spent. I found it extremely difficult to understand why those farmers remained in farming. Their take from the income they received and on which their families were expected to live was so abysmally low that there was no encouragement for them to continue to farm. As the hon. Member for Lancaster (Dame E. Kellett-Bowman) said, younger generations are extremely discouraged from remaining in farming.

The environmental implications of the MacSharry proposals should strike a chord with everyone. We should consider the proposals sympathetically. They are in line with the Labour party proposal on green premia. Such environmental proposals should be considered carefully in future. We should discourage the use of pesticides and fertilisers beyond a certain necessary level, particularly as the environmental implications of their use is already well known from experience.

We must also consider what is happening with set-aside. Some claim—I do not know whether the allegation is true—that farmers set aside the least productive parts of their land while increasing production on the other parts. That achieves exactly the opposite of what was intended. That must be nonsense.

My generation learnt in school that farmers laid certain sections of the land to rest and practised crop rotation. Perhaps in the years ahead we should revert to some of the old systems with a lower intensity and fewer fertilisers and pesticides.

Those issues are extremely important and, although we recognise the complexity of reaching agreement with our European partners, we must do so. Obviously, many other aspects of European harmonisation are also taking place. Our farming industry differs greatly from those of our European competitors because our farms are much larger. In many countries, farms are extremely small and farmers' circumstances are completely different from those in this country.

It is nonsense to have milk quotas but insufficient milk to produce all the dairy produce that we need, so that we must import so many higher value products. Anyone who goes around the supermarkets will see an increasing number of imports of such products. We must consider whether reforming the milk marketing board is the right way to proceed. We must also consider milk production and the effect of quotas, because there are some anomalies.

How do the Government see the way ahead in the negotiations? We recognise that they are extremely difficult, but we want a deal that will encourage and enable our farmers to remain in business and live a reasonable lifestyle without experiencing poverty. Many farmers in less-favoured areas are finding it extremely difficult to survive. We also want a fair deal for consumers so that they do not have to subsidise inefficient agriculture in Europe to an unfair and unacceptable extent. Finally, we want to reach an agreement that will enable the GATT round to be concluded in the best interests of this nation.

8.33 am
Mr. Andrew Rowe (Mid-Kent)

I am grateful to my hon. Friend the Member for Richmond, Yorks (Mr. Hague) for introducing this important debate in such an authoritative way, even if he brings us no cheer.

We must ask ourselves what we want agriculture for, because there is considerable confusion about that question in Europe. The purpose of agriculture used to be to produce good food as cheaply as possible so that we could feed our populations, but those days seem to have passed. However, I would not put it past us to create a policy that would cause some sort of food crisis in about 20 or 30 years' time. Many countries in the European Community see agriculture as a sophisticated form of relief for people whom it would be difficult or expensive to introduce to a more urban lifestyle.

We must look carefully at the age structure. I was surprised when I was given some figures about the age structure of French farming that showed that it was younger than I had expected. But the age structure of the farmers in many European Community countries is becoming older and older. It would be short sighted and absurd to create a policy that effectively turned out to support a generation that is coming out of farming.

If we want our farms to be a system of sophisticated countryside gardening—as I suspect many people in this country see it becoming—we shall have to debate much wider issues. One factor that makes it hard for our farmers is that they are regulated up to their necks on what they may do with their land. They are prevented from selling it for any purpose, yet we are exposing them to fiercer and fiercer competition across Europe.

I come from a constituency where most of the population would, I think, be hostile to considerable development. However, at present, we face considerable development that is being haphazardly added on to the urban sprawl. It is hard on farmers and makes it difficult to create an effective set-aside policy or take land out of production. We must reconsider those issues.

I believe that this country's farmers must do more direct marketing. The distribution chain in this country is far too long and far too expensive. That is true across Europe, but especially in this country. The Kingdom Cox campaign, which put the Cox's orange pippin back into the shops of Europe, is a fine example of what can be done if the farmers get their act together and start selling British produce in a way that causes other people to take it seriously.

We need to achieve wider alliances in Europe—not just in the European Community but within those countries that would like to join it. In addition, my right hon. Friend the Minister, who is fighting hard on behalf of British agriculture, needs to have more weight behind him. There are a great many people in Europe who, if the MacSharry proposals go through, will wake up and discover that they are a rotten deal for them. At present there is a tendency for others to say that the British are once again trying to protect their agriculture, which draws a veil over people. They stop thinking clearly and merely say, "It is the bloody Brits trying to protect their industry—we'll stop listening."

One place where my right hon. Friend the Minister might look for allies and an energetic debate is the Council of Europe, which takes in a wide range of European countries where many of the parliamentarians in the general assembly have no idea what the proposals are about.

8.37 am
Sir Hector Monro (Dumfries)

I support my hon. Friend the Member for Richmond, Yorks (Mr. Hague) and my hon. Friend the Minister, who has done so much to help farming since he came to office.

There is no doubt that farmers' incomes at present are as low as I remember them for many years. It is incongruous that, when the cost of the common agricultural policy increases, farmers' incomes seem to go down. I know that the Government are doing all that they can to fight the MacSharry proposals, which will make matters infinitely worse than they are at present.

Mr. MacSharry seems to be under the impression that all large farms make profits when, in fact, many of the largest farms, particularly in Scotland, are in hill sheep districts, where incomes are low and largely supported by the sheep premium, the suckler cow premium and the hill livestock compensatory allowance.

It is important that we look ahead, perhaps in terms of marketing, or in other ways, so that when we lose the intervention price for sheep next January, we know what will happen. At times this summer, lamb has been down to 100p per pound and it may be stabilising now at 120p. Even that means a huge intervention price, and what will happen when that support disappears?

I support the remarks of the hon. Member for Burnley (Mr. Pike) in respect of milk products. Large manufacturing processors in my constituency are short of milk and it seems ridiculous that Europe should be saying that we must cut production by 2 per cent. or more when there is a shortage in this country of milk for processing. I am sure that my hon. Friend the Minister has taken that point on board and that I need say no more about exporting milk products to the Mediterranean, middle east and Russia and the unnecessary difficulties that seem to be put in the way of our producers.

Farming is certainly going through a difficult time. The set-aside scheme is of minimal importance to the industry's overall problems, and we must devise with Mr. MacSharry proposals that are more acceptable to the farming industry. Farming has a right to see a fair return on its capital and it is not achieving that at present. No one is using the word "prosperous"—we only want a reasonable level of profitability for an industry that can help the rural countryside to maintain its present high environmental standards. If we do not all work together to that end, the nation will be the loser.

8.41 am
Mr. Ray Powell (Ogmore)

Farming in Wales is dear to my heart. My parents were born in Malvern in Worcestershire and, as a result of the depression that hit the country at one time under the then Conservative Government, my father had to move to the Rhondda valley to work in the mines. He always wanted to return to farming and most of my colleagues and friends in my constituency are farmers.

I had hoped to contribute to the next debate, on training and enterprise councils, because they are also a subject close to my heart and to my constituency activities.

We were once advised by the Minister of State, Welsh Office, to invest in a farm in the Garw valley so that we could train people to become agriculturists and horticulturists. We embarked on a programme by employing a farm manager from Leigh Sinton in Malvern, who came to the Garw valley. The £100,000 farm that we established employed 45 agriculturists—young people interested in the farming industry.

Within two years, the same Minister told us that it would be far better to invest Community funding in computers, because the Government no longer required as many agriculturists or horticulturists. As a result, the farm programme was abandoned. Having listened to Ministers over the past few months, I am beginning to wonder whether they are true to their beliefs, because if they do not want to train people, it does not seem likely that they are interested in encouraging the farming industry.

Many of my Welsh hon. Friends—and one in particular, who is not a member of my party but is a farmer—constantly impress on me that farmers are losing a tremendous amount of money and have done so for years as a consequence of Government policy.

I have met many farmers, and I have noticed that they seem always to wear old and tattered tweed coats with leather patches on the elbows. They wear shirts that I have seen on them over the past five or six years. They usually have a good, strong pair of boots that have lasted them longer than the pairs of shoes that I wear to wander about the house. They look as though they have just picked up the mean social security benefit to which they would be entitled from the Government.

Lo and behold, as happens to us all, Father Time comes along and these men come to the end of their days as farmers. The son inherits the Rover, or sometimes the Rolls which is in the cowshed. There is often a great dispute within the family about the wealth that is left by the farmer. We do not know the wealth of a farmer until his will is published.

Dame EIaine Kellett-Bowman

The farmer's wealth is the value of the land that he leaves. He cannot sell off bits of land to live by.

Mr. Powell

I thought that the hon. Lady was writing a speech. I was in full flow, but I find that the hon. Lady's interjection—

Madam Deputy Speaker (Miss Betty Boothroyd)

Order. I know that the hon. Member will not allow an interruption to divert him from what he intended to say about EEC farming.

Mr. Powell

That is right, Madam Deputy Speaker. If the hon. Member for Lancaster (Dame E. Kellett-Bowman) had not interjected in my speech, I would now be concluding my brief speech.

I remember a recent sitting of the Welsh Grand Committee when my right hon. and hon. Friends were all on the list of speakers in a debate on Welsh farming. A group of farmers travelled here from Wales—no doubt they had left the cows to be milked in the evening—to attend a sitting of the Committee. They listened to the debate and a strange thing happened during it. They cheered my hon. Friend the Member for Alyn and Deeside (Mr. Jones) as he spoke from the Opposition Front Bench.

I was pleased when I saw him enter the Chamber a short while ago to take his place on the Opposition Front Bench. Cheering is unusual in the Public Gallery of a Committee Room. Indeed, it would be unusual if the Public Gallery of the Chamber were crowded with farmers and they started to cheer during a speech. My hon. Friend made a speech on behalf of farmers and the farmers on the Strangers' Seats cheered him because of the promises that my hon. Friend made to sustain them until the coming to power of a Labour Government, perhaps in November this year, March or April 1992, or whenever the general election takes place, after the Prime Minister has the guts to call it.

The farmers cheered in the hope that what was being said by my hon. Friend on behalf of the Opposition as shadow Secretary of State for Wales meant that policies would be introduced to assist farmers in Wales. Such policies are long overdue. After all, farmers and others have been waiting for them for the past eleven and a half years. We have been waiting for the Government to make a positive contribution to farming and to save a great many farms.

I have referred to the farm that a trading organisation took over. There was one section for trainee farmers and another for trainee horticulturists. The farm is now up for sale. Its value two years ago was £220,000. The highest offer that CATO—Community Activities and Training in Ogwr—received for the farm was £100,000—substantially less than it paid for it.

I mention that case because that is happening throughout Wales. Hill farms, sheep farms and dairy farms are for sale, but the farmers cannot get a price that reflects the worth of their properties. The farm in the Garw valley has only 88 acres, but we cannot get an offer for it to cover the outstanding mortgage. I appreciate the difficulties of farmers at the present time. The promises from Ministers about what they will do for farmers both in Wales and throughout the United Kingdom do not appear to assist them in any shape or form.

Of the list of debates that should be held on the Consolidated Fund, some 20 are still to be called. Hon. Members are in the Chamber with prepared speeches hoping to speak on matters just as important—perhaps even more important—than agriculture. Only last week the House debated the sittings of the House, when it was suggested that there should be shorter hours. There should be longer hours so that all debates could be held. The Consolidated Fund is the only occasion when hon. Members can deploy their arguments on their chosen subjects. Perhaps you could help us, Madam Deputy Speaker. For the past 12 months I have campaigned about the way in which training and enterprise councils conduct themselves. I am sure that—

Madam Deputy Speaker

Order. I fear that the hon. Gentleman in now testing the patience of the House. The debate is about European agriculture policy and the hon. Gentleman must refer to that or allow other hon. Members to speak and the Minister to reply.

Mr. Powell

I realise that hon. Members are eager to participate in the debate and that the Minister is eager to reply to it. I have waited all night for my subject matter to be called, but it is now too late for that. However, this debate is important, and I wanted to contribute to it and to refer especially to my constituency.

Hill farming in Wales and in Ogmore faces great problems. North Wales has had, and still has, a problem because of contaminated lamb. Some people in parts of north Wales are afraid to buy Welsh lamb. When, on a previous occasion, I said that a butcher in north Wales was using a geiger counter to prove to his customers that his lambs were free from contamination, the Minister suggested that I was scaremongering. But that has happened in north Wales, and there is still doubt about the lamb.

Farmers are suffering because of the Government's attitude and the lack of compensation for the shortfall in the amounts for which lambs would be sold at market.

I hope that there will be sufficient time left in the debate for me to introduce my subject.

8.55 am
The Parliamentary Secretary to the Ministry of Agriculture, Fisheries and Food (Mr. David Maclean)

I thank my hon. Friend the Member for Richmond" Yorks (Mr. Hague) for raising this issue and for providing me with an opportunity to set out the Government's proposals on reform of the common agricultural policy.

It was interesting that, when I tempted the hon. Member for Burnley (Mr. Pike) by saying, "I shall tell you my proposals if you tell us the Labour party's" he said that the Labour party would tell us when it was in power. I suspect that we will wait a long time before we hear the Labour party's proposals for reform of the CAP. In the next few months, we shall tell all farmers that the Labour party has nothing to offer on CAP reform.

It is also interesting that, when I tempted the Labour party to tell us its policy, it rushed in the hon. Member for Ogmore (Mr. Powell) to try to ensure that I would not have enough time to answer the debate properly. [Interruption.] To hear Opposition Front-Bench Members saying to the hon. Gentleman's little filibuster, "Nice one" just proves that they do not want to hear the facts. Although the hon. Member for Burnley might not have told us his policies, I shall tell the House the principles in which the Government believe as we argue for CAP reform. It must be sensible reform, not the MacSharry proposals.

Our objectives for reform can be met only if MacSharry's proposals are modified to include a progressive reduction in the level of prices and other support, at a pace that will enable efficient farmers to adjust. We want measures that bear equally on all producers, regardless of size of enterprise or location. Budget costs should be kept within the guideline. Direct aids should not be paid to all farmers but should be more selectively targeted at particular objectives: for those who deliver specified care for the countryside, meeting a need that market forces alone will not meet; and for those who face permanent handicaps of climate and geography.

If help is judged essential to assist any producers to get through the period of change, payments should be limited in time and degressive in amount, constituting real adjustment aid. There is no harm in retirement payments for outgoers. Such payments could play a useful role, at least in some member states. Set-aside should be on a voluntary basis and used to help the environment. To ensure that it is applied effectively in all member states, the idea of national targets should be seriously considered.

Environmental considerations should become an integral part of the CAP. The Commission's idea for agri-environmental programmes should be extended, but the opportunity should also be taken to incorporate environmental conditions in other forms of agricultural support wherever practicable.

I believe that our message is clear. We all agree that reform of the CAP is essential for farmers, consumers and taxpayers alike. Reform along the lines that MacSharry proposes would not encourage efficient farming, but would let budget costs go up even further and would discriminate against efficiency, particularly of producers in all parts of the United Kingdom—in Yorkshire, Cumbria, Dumfries in Scotland and even in Wales.

MacSharry's proposals would cost the taxpayer much more. They would not provide cheaper food prices and would devastate our countryside. MacSharry is rightly treading the path of reform, but he has lost his way and we believe that we should get him back on course.

Mr. MacSharry's proposals would devastate our rural economy. Thousands of small tenanted farms, not just big estates, would be devastated and the consequences for our rural economy would be appalling. As a Government we must not allow that to happen. Thousands of sheep farmers would be driven off the land and the public must understand that we would have no idyllic dales or lovely fells without active sheep farmers, no more dry stone walls repaired or hay barns saved from dereliction and no more trees planted or hedgerows relaid.

It being Nine o'clock, the motion for the Adjournment of the House lapsed, without Question put.