GATT (Hansard, 3 December 1992)

§ 6. Mr. Barnes
To ask the Minister of Agriculture, Fisheries and Food what assessment he has made of the consistency of the GATT agricultural agreement with the recent CAP reforms; and if he will make a statement.

§ Mr. Gummer
The recent agreement between the European Community and the United States on GATT agriculture paves the way for wider agreement in the round. The Commission has made it clear that it is compatible with the reforms of CAP regimes agreed earlier this year, as I said in reply to question 4.

§ Mr. Barnes
Even with the reforms, the CAP is protectionist and has considerable subsidy equivalents. Although GATT is not a free trade system, it stands for trade liberalisation. Is the only way in which the circle can be squared between the different principles by taking more and more land out of production, at a time when more and more people in the world are starving?

§ Mr. Gummer
I agree with the hon. Gentleman that there is a need to protect the countryside of Europe and to ensure that agriculture can continue sensibly there. If that 383 protection is not afforded, the countryside on which we depend will not be the sort of countryside that town dwellers and surburban people want to see. Of course we must protect agriculture to enable townsmen to enjoy the countryside. That can be done, but at a lower cost and with less protection than in the past, both through CAP reform and through a GATT agreement. That is why the Government have pioneered the CAP reform and why we have been at the centre of the battle to ensure that there is a GATT agreement.

§ Mr. Dykes
May I congratulate my right hon. Friend on his skilful chairmanship of the EC Agriculture Council during our presidency? Is he now confident that the French will accept the GATT deal and that they will not exercise any vetoes?

§ Mr. Gummer
The French Government have made it clear that they are unhappy about some of the details of the arrangements made between the European Community and the United States. They have also made it clear that they wish to see the whole GATT deal in the round before they make up their mind. They will then decide what is in the interests of France. It is inconceivable that it could be in the interests of France not to have a GATT deal which, after all, will help Europe to get out of the recession that has led to more than 3 million people being unemployed in France.

Mr. John D. Taylor
Under the GATT agricultural agreement, what are the prospects for cheaper feeding stuffs to give an incentive to our intensive sector in agriculture?

§ Mr. Gummer
The main ability to reduce the price of feeding stuffs comes from the CAP reform, which is taken up in the GATT agreement. There will be a reduction of 30 per cent. in the support price of cereals, which will have a direct knock-on effect in the price of feeding stuffs. Those feeding stuffs take up a large proportion of the end price of both pigs and poultry.

§ Mr. Hawkins
My right hon. Friend will be aware from my previous discussions with him of my concern for the largest mushroom grower in the north of England, which is in my constituency. As part of his work on the continuing CAP reforms, will he pay special attention to the unfair subsidies that are paid to rival mushroom growers in a number of other countries? Will he join me in congratulating Pixie House Mushrooms on combating those unfair subsidies and winning this week the award for business of the year in our area, which was sponsored by First Leisure plc and by the local newspapers?

§ Mr. Gummer
After that short break, we come back to the main programme. I agree with my hon. Friend that there are some practices within the Community that fundamentally distort competition and trade. They underline the need for Community action and decisions made across the country so that trade may be fair. I will continue to fight to ensure that British firms have a fair deal in Europe.

§ Dr. Strang
I thank the Minister for his earlier congratulations. Is he aware that the Labour party wants international agreement on an overall GATT deal as soon as possible? However, measures will be required to protect the livelihoods of our farmers and farm workers, not least because of the hundreds of thousands of jobs in the food 384 and drink industries which are dependent on home agricultural produce. If concessions are made to secure a French agreement on GATT, will the Minister ensure that such concessions do not discriminate against our agriculture and that the British, as consumers and taxpayers, do not bear a disproportionate share of the cost?

§ Mr. Gummer
The hon. Gentleman is right to say that a trade deal in GATT is essential. That point has all-party support. I do not see how any agreement under GATT could disproportionately disadvantage the United Kingdom. I am looking closely at the small print of the discussions so far to ensure that that does not happen. I do not believe that the French can object to the agreement under the CAP reform to which they added their vote. It follows that if CAP reform is consonant with GATT and GATT is consonant with CAP reform, there is no place for changes that would benefit one country rather than the others. Any changes that take place over the next few months must, as with any other changes, be fair for all countries, neither disproportionately costing nor disproportionately benefiting countries merely because they have made a lot of noise.