HC Deb 23 June 1994 vol 245 cc346-8
7. Mr. Gapes

To ask the Minister of Agriculture, Fisheries and Food if she will make a statement on imports of beer from European Union countries and the effect on the British brewing industry.

Mr. Jack

I understand that the industry estimates that commercial imports fell last year.

Mr. Gapes

Why, then, are tens of thousands of bottles of imported French lager on the shelves of Sainsburys and Tescos throughout the country? People are buying that beer, presumably because the tax level is much lower than it is on our domestically produced beer.

Are not British jobs being put at risk by the dual policy that allows a flood of cheap imported beer—which is good for the consumer, something that I generally favour— while imposing a regressive tax on domestically produced beer? Just as the Government impose a VAT increase, they are also clobbering ordinary people through the beer tax.

Mr. Jack

It always amazes me when Labour Members want to indulge in knocking the British brewing industry. The hon. Gentleman did not want to tell the House that United Kingdom beer exports rose by 10 per cent. in 1993.

On the first part of the hon. Gentleman's question, I cannot think that there would be any difference in the tax levied, at whatever rate it may be, on French, German or whatever beer sold in the United Kingdom—yet that is what he said. In the second part of his question, the hon. Gentleman alluded to some of the arguments about cross-border shopping. The duty and excise matters relating to that are the province of my right hon. and learned Friend the Chancellor of the Exchequer. However, the hon. Gentleman should keep the matter in perspective. The total amount of beer involved in that trade is the equivalent of just 3.5 per cent. of total UK consumption.

Sir Ivan Lawrence

As the subject is something in which my hon. Friend is closely concerned, can he say what would be the cost to the Exchequer of reducing the tax differential on alcohol between ourselves and the French and the Germans to the same level as is enjoyed in those two countries? What realistic chance is there of bringing the two levels of 32p and 4p closer together so that minimum harm is done to the British brewing industry?

Mr. Jack

My hon. and learned Friend's question touches on a wider issue that is beyond the responsibility of the Ministry of Agriculture, Fisheries and Food. However, I shall certainly write on his behalf to my right hon. Friend the Paymaster General to seek his worldly advice.

Mr. Strang

How complacent can the Government get in respect of personal beer imports? Can the Minister contemplate the reverse situation, in which French nationals were able to cross the channel to England and buy wine at much-reduced prices? How long does the Minister think that the French Government would tolerate that? Is not it time that the Government acted to defend Britain's brewing industry and the thousands of jobs that depend on it, directly or indirectly?

Mr. Jack

I entirely agree with the hon. Gentleman that we should take action to help the British brewing industry, which is precisely why we spent about £2 million on the link programmes to which my hon. Friend the Parliamentary Secretary referred earlier, which improved the competitiveness of British brewing, increased exports 10 per cent. in 1993 over 1992 and helped to safeguard jobs. As to the tax issues, it is not a question of complacency. My right hon. Friend the Paymaster General has dealt with those issues in extenso in public.

Mr. Nigel Evans

My hon. Friend said that the percentage of beer illegally imported into this country is small at present, but it is increasing dramatically. Will my hon. Friend join me in visiting Calais next weekend, to examine that problem? It appears to be growing and is having an impact on the British brewing industry, and will continue to do so unless immediate action is taken to stem illegal beer imports.

Mr. Jack

I much appreciate my hon. Friend's generosity in offering a free trip to Calais, but he will understand that the needs of my constituents in Fylde must come first. I have been to Calais in the past 12 months and seen the phenomenon to which my hon. Friend referred. Another trip would not necessarily educate me further in that respect. I say again that we must keep the matter in perspective. It is estimated that cross-border shopping for beer represents the equivalent of only 3.5 per cent. of total UK beer consumption. My Department has done what it can to strengthen the competitiveness of British brewing, in the ways that I outlined earlier.

Mr. Hoon

The Minister sought to pass responsibility to the Paymaster General, but he must surely feel concerned about the impact of the growth of personal imports on British hop farmers and on hop production. If the present rate of increase continues, that will have a dramatic effect on the Minister's responsibilities for hop farming.

Mr. Jack

I am obviously concerned, but I hope that the hon. Gentleman supports the attempts being made by my right hon. Friend the Paymaster General, through the work of Customs and Excise, to ensure that people play by the rules. There have been changes in import arrangements for the personal consumption of beer, wine and spirits. They are sensible easements in terms of the completion of the single European market, but robust action is taken against those who abuse the rules and who are the main cause of the problem at the heart of the hon. Gentleman's question.

Mr. Fabricant

My hon. Friend will be aware that a number of directors and workers of the Bass brewery live in the leafy lanes of Lichfield. They are also most concerned about the amount of imported beer entering the United Kingdom for onward sale, when it should be for personal consumption only. However, will my hon. Friend congratulate my right hon. Friend the Paymaster General on a number of recent successful prosecutions? My hon. Friend mentioned a 10 per cent. export sales increase, but is he aware that Bass and a number of other breweries are now producing beers specifically for sale in France, with French consumer tastes in mind?

Mr. Jack

I shall certainly pass on my hon. Friend's congratulations to my right hon. Friend the Paymaster General on his successful prosecutions. I congratulate Bass, which recently opened a £61 million brewery for the production of premium and export beers. British brewers are hitting back against the competition.