Bovine Spongiform Encephalopathy (Hansard, 18 April 1996)

§ 11. Mrs. Clwyd
To ask the Chancellor of the Exchequer if he will assess the impact of the BSE crisis on his Budget policies. [24324]

§ Mr. Kenneth Clarke
I will take account of any financial and economic consequences of BSE in framing my proposals for my Budget in November.

§ Mrs. Clwyd
As the Government have made such a ghastly mess of this whole issue, and since Goldman Sachs is predicting that it will add £1 billion to the public sector borrowing requirement in the next year, does the Chancellor think that that is why the Prime Minister has had to rule out tax cuts with which to bribe the electorate in November?

§ Mr. Clarke
The Government are handling this extremely serious crisis for the British farming industry most effectively. We are seeking to restore public confidence and to intervene effectively in the farming and food industries to keep them in good shape for the eventual recovery of the beef market. There will be costs, because we have carefully targeted compensation and joined in proposals for intervention measures to ensure that the farming and food industries do not suffer because of a short-term shock that was beyond their control.
We do have a reserve to cover just such unforeseen contingencies, and I expect to be able to meet the costs of any measures that we have to take to deal with the BSE crisis without breaking the new control total or our public expenditure plans.

§ Sir Peter Tapsell
Despite the disgracefully anti-British behaviour of the European Union over the British beef problem, has my right hon. and learned Friend been heartened by the fact that over this period the gilt edge market has remained entirely robust, thus indicating the confidence of the international investment community in Britain and in this Government?

§ Mr. Clarke
There is no scientific reason, as we all know, for the fears about eating British beef. The Government have had to counter the hysteria in this country and abroad that has led to falls in consumption at home and bans on our beef in America, Australia, New Zealand and the European Union. We are determined to ensure that the reputation of British beef is restored throughout the world. Indeed, the British beef industry deserves to be as healthy as the bond market. I agree with my hon. Friend that the confidence of the bond market and the gilt edge market in our conduct of the British economy should eventually be reflected in beef industry sales and in confidence in the good quality of British beef.