§ Motion made, and Question proposed, That this House do now adjourn. —[Mr. Anthony Coombs.]
9.30 am§ Mr. Eddie McGrady (South Down)Thank you, Madam Speaker, for the opportunity to debate this issue, which is much appreciated by the farming community in Northern Ireland, and, indeed, by the greater rural communities on which it depends.
The bovine spongiform encephalopathy crisis broke out last March, and led to the ban on the export of United Kingdom beef. It was clear that the impact would be greater on Northern Ireland than on Great Britain, because 80 per cent. of Northern Ireland's beef product is exported, compared with some 20 per cent. of British beef. That means that by far the greatest proportion of the Northern Ireland farming industry's beef product has now lost almost its entire market. The collapse of the beef export market has left the farming community in Northern Ireland in great financial crisis.
The House should appreciate that the farming industry is the basic industry in Northern Ireland, not only for farmers and their families, but for the many rural communities that survive on the economics of the surrounding farming fraternity. It would not be an exaggeration to describe the impact of the crisis on the dependent rural communities as the single greatest tragedy since the great famine in Ireland 150 years ago. Although this crisis will never, thank God, reach the horrific proportions of that period, it is, none the less, a most devastating blow. The farming community sees it as the greatest single setback of the past 150 years.
As I said, agriculture is central to the economy of Northern Ireland—in fact, the beef industry is worth £1 million a day to the local economy. The unfairness of the impact on Northern Ireland was the first major reaction among farmers and their representatives. It should be noted that the incidence of BSE in Northern Ireland was only one tenth of the incidence in Great Britain, and the outbreak was largely confined to the dairy herds in Northern Ireland. Moreover, Northern Ireland had a much more efficient system for containing the outbreak and assuring the quality of Northern Ireland beef, through the farm quality assurance scheme.
Northern Ireland has a sophisticated computerised system that ensures the traceability of every animal in the cattle herd—I repeat, the traceability of every animal in the cattle herd. That reduces the possibility of infected animals entering the food chain to practically zero—the possibility is almost eliminated. On Monday, the Minister 738 of Agriculture acknowledged that Northern Ireland had a significantly lower incidence of BSE than other parts of the United Kingdom, and that it had that almost 100 per cent. effective traceability scheme. Both those factors should facilitate easier access to a certified herd scheme, should one come about.
The first response of the farming community and its organisations, which received unanimous cross-party support from Northern Ireland's Members of Parliament and Members of the European Parliament, was to ask for separate status for Northern Ireland, so that it could escape the total ban on the export of UK beef. Commissioner Fischler has indicated then and now that the European Commission would look sympathetically on such a proposition, not only for Northern Ireland but for other parts of the United Kingdom, such as Scotland and other regions, that have that lower incidence of BSE and greater traceability of animals.
The stumbling block, however, is that a request for such status must be made by the sovereign Government of the United Kingdom, and the Government have adamantly turned their face against such a proposition. I hope that the arguments that we may hear this morning will enable a change in attitude and policy, or that the arguments will cause some other change that will enable the general idea of separate status to be implemented.
It was also interesting to note that when, last Monday, the President of the European Council of Agriculture Ministers—Mr. Yates, TD—met representatives of the farming industry and politicians in Northern Ireland, he offered strong support for the removal of the EU ban on the export of Northern Ireland beef. Therefore, the presiding Agriculture Minister of the EU and Commissioner Fischler have both indicated their support—if only the Government would make a request.
The Government's initial response to the crisis, with the agreement of the EU, was a cull of animals older than 30 months, on the basis that cattle younger than 30 months were less at risk because of the disease's development time. The cull began at the beginning of May. Initially, the prices paid were reasonable, and cattle began to move off the farms.
In Northern Ireland, the scheme was administered by the Northern Ireland Meat Exporters Association, which represents all the major beef plants, in a co-ordinated effort to ensure that all farmers received equal treatment. Farmers were invited to inform the association of the likely number of animals they would submit for the cull.
The theory was that a percentage of each farmer's animals would be taken away on a rotational basis, depending on the capacity of slaughterhouses and rendering plants, until the cull was complete. There have, however, been quite a number of problems in ensuring the smooth operation of the scheme. The scheme lost much credibility, and elements of unfairness and privilege have crept into it.
There is a huge backlog of animals waiting to go through the system. Since last May, 160,000 animals were booked to go through the cull, and about 80,000 have gone through it—30,000 culled cows and 50,000 "clean" cattle. There is an estimated backlog of 45,000 cows, and another 30,000 "clean" cattle require culling.
I think that it would be accepted in most quarters in Northern Ireland that there has been substantial overbooking, so that the backlog is possibly less than 739 100,000. The Department of Agriculture in Northern Ireland estimates that the backlog is approximately 50,000 cows, but we think that that is probably a conservative estimate. Each week, about 2,000 new animals—mainly older cows—are becoming eligible under the terms of the scheme. Clearly, therefore, with the current maximum rendering capacity of 4,000 animals per week and a net clearance from the backlog of only 2,000 animals per week, it will take a considerable time to clear the backlog.
I understand that new measures have been implemented recently to speed up the disposal of cattle over the age of 30 months, with changes in rendering and the storage of carcases. I hope that the situation will be improved, as it is still not acceptable.
There must be greater co-ordination between the Northern Ireland Meat Exporters Association and the meat plants. Farmers allege that animals have been booked for a long time and that none have been taken. Farmers are entering the most difficult period of their financial year, as the summer feed has finished this month, and cattle will now go into indoor feeding. The backlog of cattle is still on the farms, and some farmers are receiving no income whatsoever. If they cannot buy new feed, many of them will suffer financial disaster.
It is expected that two things will happen. First, some farmers, and quite a few small farmers—of which Northern Ireland has a great proportion—will go to the wall financially. That will affect not only farmers and their families but the communities in which they have lived perhaps for the past 200 years. It is a significant financial and deep psychological problem for Northern Ireland's farming communities.
Secondly, if the cull throughput is not accelerated, there is the prospect that animals will have to be killed and burned in the fields of Northern Ireland. I am sure that no hon. Member wants to see that happen to the rural communities of Northern Ireland.
Rendering plants have been working at full capacity from May to September. We have very few rendering plants, and the Lisburn plant will be closed down for refurbishing for a couple of weeks. Furthermore, the plant at Duncrue, in Belfast, was totally out of action last week, which has increased the backlog.
We need additional cold storage capacity, which might ease the problem. There are, however, some technical difficulties with storage. I am sure that the House would not be particularly interested in the details of the difficulties of freezing whole animals, and I am not able to give it those details. The shortage of cold storage, however, is one of the great difficulties that we are facing.
Over the next few weeks, additional rendering capacity could be made available elsewhere in the United Kingdom. The animals would have to be transported live—on the hoof—which would impose a burden of additional costs on an already impoverished farming community. The Government should commission additional freezer units, either static or mobile, as quickly as possible to store intervention stocks, thereby enabling the cull to proceed much quicker.
Beef producers in the United Kingdom are to receive additional support worth £29 million, as part of a £45 million package of extra aid that was announced by 740 the UK Agriculture Minister, and £16.6 million will be spent on extra cold storage capacity to speed up the cull of animals over 30 months. The farming unions and communities of Northern Ireland and I welcome that support.
However, farmers have been quick to point out—as they always are in financial matters—that those additional funds are probably less than the amount that they will lose, because of the forthcoming 10 per cent. cut in compensation payments for animals over 30 months. It appears—I should like to hear the Minister's comments on this—that nothing will be gained from this so-called "extra money".
Farmers are suffering a severe loss in cull prices, and the problem will become even more acute this week. Farmers have been receiving £1.50 per kilo for steers and heifers at deadweight and £1.66 per kilo for cows, whereas market prices before the crisis were about £2.20 to £2.30 per kilo.
There had been a supplement of 25p per kilo live weight on steers and heifers, but Treasury pressure ensured that that was reduced by 80 per cent. to 5p, which is again a substantial clawback. Now that compensation rates have been reduced further, it is expected that the value of animals will go down yet again by another £50 or £60. As I understand it, that is due to take effect from 21 October. I urge that, at the very least, the supplement that has been cut be restored, and, in addition, that compensation rates be increased all around.
It will be noted that the European Commission made available 112 million ecu, which has been used to provide a top-up for the beef special premium at £17.40 per head and a top-up of £23.13 per head for the suckler cow premium and for a payment of £60 per head for all animals sold for slaughter between 20 March and 30 June. However, the Government were given the authority by the Commission—I hesitate to express it that way, as I know that the UK does not need that authority—to produce matching funding. That was the intention, but they have failed to do so. Should the Government match the Commission's funding, it would enable the top-ups for the beef special premium and the special cow premium at least to be doubled, thereby alleviating much of the financial hardship now being endured by farmers in Northern Ireland.
I note that Baroness Denton announced last Friday that beef producers in Northern Ireland would receive an advance of 80 rather than 60 per cent. of the full rate of payment under the 1996 beef special premium and suckler cow premium schemes. I understand that that will come into effect on 1 November. It is to be welcomed, because it will alleviate part of the current cash flow crisis being experienced by farmers in Northern Ireland. However, never being satisfied, may I suggest that the 80 per cent. could be increased to 100 per cent., to allow farmers to survive the great difficulties of the next few months?
Suckler cow farmers are facing a very difficult period. Most of them depend almost exclusively on the income received from sales of their calves at the autumn sales. Because of the uncertainty in the beef industry, there is a great fear that prices will plunge disastrously. The most effective short-term help for suckler cow farmers is through the hill livestock compensatory allowance.
A few years ago, the HLCA, as it is known, was reduced for two successive years, and subsequently frozen for two successive years. In effect, it thus fell for four 741 successive years. I note that the Government agreed on 18 September last to make £60 million available to cattle producers in the less-favoured areas under the 1997 HLCA. Of that amount, we think that £14 million will be available to Northern Ireland, which is to be welcomed.
As I understand it, the difficulty is that the precise rates for the 1997 scheme will not be set until after the autumn review of economic conditions in the hills and uplands. In view of the unprecedented crisis in the beef industry, there is now a compelling argument for a substantial increase in HLCA payments to help tide suckler cow farmers over their present difficulties. I hope that the autumn review produces sensible, practical and, of course, increased rates of aid for the 1997 scheme. There should also be a compensatory payment on calves sold this autumn to compensate for the anticipated heavy market losses, if they are incurred.
In the medium and long term, the best way to steady prices at the autumn sales and to stabilise the beef industry generally is through the intervention system. I urge that a guarantee be given that all future Northern Ireland tenders for intervention will be awarded in full, that a fixed price be established for all grades, and that preconditions attached to weight limits be removed, at least until the crisis is over. That would enable farmers who buy calves in the autumn sales for fattening to plan with some confidence, and would help to shore up prices at the calf sales.
The argument for the removal of the ban on the ex port of Northern Ireland beef must not be abandoned. It has been suggested in some quarters that it could be lifted in the new year, but, given the Government's current attitude and interpretation, that seems unlikely. If the hassle between the UK and the European Union over throughput under the accelerated slaughter scheme is unresolved, pessimism will reign in Northern Ireland, and it could be 2000 or beyond before UK cow beef could appear in the marketplace. That would be totally unacceptable.
It must be emphasised that the beef industry in Northern Ireland already meets a number of the requirements of the Florence agreement, which were accepted as necessary to secure a step-by-step lifting of the ban. Northern Ireland is well placed in terms of animal identification and the recording of movement and total traceability, and it already meets the prerequisite for lifting the export ban.
Some 2,000 animals come under the BSE cohort slaughter programme. That number could be dealt with in weeks, if not five or six days. The accelerated slaughter programme was agreed in Florence last July as one of the conditions for lifting the export ban. The problem is that the scheme, which is 70 per cent. EU-funded, has not been finalised. Indeed, I understand that the Government have drawn back from it.
§ Mr. Malcolm Bruce (Gordon)Does the hon. Gentleman agree that it would be helpful if the Minister responded to that point? As the hon. Gentleman said, the Minister of Agriculture has said that we are holding back for the time being, but implied that the Government are invoking scientific justification for doing so. It was agreed at Florence that detailed proposals would be made by the British Government, so, if no proposals are put forward, the Government are in breach of the agreement.
§ Mr. McGradyI thank the hon. Gentleman for his intervention, and I agree with him. As I recall the 742 sequence of events, the Florence convention was suspended—if that is the right word—because of what was alleged to be new veterinary scientific information. That information was apparently the decision by some—I emphasise, some—veterinary scientists that BSE was not necessarily caused by maternal transmission, but that the source was a possible predilection in the progeny of an infected cow. Consequently, the Government decided that BSE would somehow magically run itself out by the year 2003.
I agree with the hon. Gentleman that the Government have pulled back from the commitment given at Florence. That has had a further effect. It has undermined the good will that existed in the Commission, in Fischler, Yates and the other Agriculture Ministers. It was a regrettable step, and a devastating one for Northern Ireland. The Government seem reluctant to implement the Florence agreement to secure the immediate lifting, wholly or partly, of the ban on Northern Ireland beef.
In the meantime, there is a possibility of movement through consultation with the European Commission on proposals for relaxing the export restriction for animals from certified herds which have had no contact with BSE. I point out to the House that 97 per cent. of herds in Northern Ireland could qualify for the UK certified herd scheme. It is hoped that such a scheme could equate to the well-established farm quality assurance scheme.
I note that the chief veterinary officer for Northern Ireland is to meet tomorrow in Brussels his counterparts in the European Union Standing Veterinary Committee. I note that he will seek assurances that "going it alone" with the slaughter could open the way for the certified herd scheme. I sincerely hope that he will be successful, and that he will receive unanimous and strong support from the Government in his endeavours in that respect.
In Northern Ireland, as in the United Kingdom generally, any herd that has had a BSE-infected animal has been flagged by the Department of Agriculture. There is a major problem here, in that, in the United Kingdom, and only in the United Kingdom, it is the farm and not the herd or the animals that is flagged; in the rest of Europe, it is the herd that is flagged. Therefore, even if all the cattle on the flagged farm are removed and slaughtered, and new stock is brought in, flagging remains a total impediment. Surely we must all agree that that absurdity must be ended.
I understand that our flagging system happened by accident, and that the relevant wording in the legislation was not caught on to at the time. As I understand it, the European Commission is willing to address the erratum at an early date if effort is put into the matter.
In reality, while flagging applies to the farms, there is no realistic market for animals from flagged herds, which is disastrous for farmers in that category. Those most affected are the small suckler herd farmers, some dairy farmers, and farmers with a high-quality output. There must be a buy-out scheme for the suckler herds—about 300 in number—leading to the removal of flagging of holdings rather than herds, so that farmers can begin to rebuild their herds and their livelihoods. At present, their livestock will not be dealt with.
The 3 per cent. affected are made up of a number of elements. The suckler herds are only 0.75 per cent. of the 3 per cent. total. They are a small fraction, and could be dealt with if the Government could devise a scheme to 743 allow herds to be depopulated, farm buildings to be cleaned out and farms to be restocked with non-BSE-infected cattle. Farmers could thus, we hope, gain certified herd status. Such schemes exist in the Republic of Ireland and other EC countries, so why can they not exist in the United Kingdom?
Is there not now an opportunity in this very small sector to introduce a beef herd set-aside scheme, similar to other agriculture set-aside schemes, starting with the BSE-flagged beef herds in Northern Ireland? I should like the Minister to take that point on board as a means of getting round an impossible situation for the 3 per cent. that are not covered by the certified herds scheme.
Another element creeps into the equation. There is an enormous backlog of cattle on farms waiting to go through the cull system. Many of them are dairy cows which are still being milked, and milk production is running way ahead of what it would normally be. It is clear that dairy farmers in the UK will be severely punished for producing over quota this year, which could trigger yet another penalty in the super-levy.
I suggest to the Government that the best way in which to deal with that problem is to plead exceptional circumstances, and either to negotiate extra milk quotas for this year in recognition of the dimension of the crisis or, if that is unsuccessful, at least to negotiate a substantial reduction in the super-levy.
I have covered a number of points on the issue, which, as I said at the start, is an absolute disaster for farmers in Northern Ireland. I will sum up the main points for the Minister's quick reference, in the hope that he will respond to them positively and helpfully. First, I would like him to address the point about the provision of additional cold storage and freezer capacity. Secondly, there is a need to provide extra rendering capacity either in Northern Ireland or elsewhere.
Thirdly, the compensation price must be improved; I have already mentioned the details. Fourthly, the Government should address the issue of matching EU funding to enable a substantial increase in the beef special premium and the suckler cow premium. Fifthly, HLCA payments should be increased substantially as a result of the autumn review to help the suckler cow farmers through the present crisis. In addition, there should be a compensatory payment for calves sold this autumn.
Sixthly, there must be a guarantee of continuing beef intervention, with all future Northern Ireland tenders being awarded, full and fixed prices being established for all grades, and no weight conditions. I hope that the provisions of an accelerated slaughter scheme will go ahead as soon as agreement is reached on compensation levels.
I ask that the flagging of holdings should stop, and that flagging should be applied to herds only. A buy-out scheme for flagged suckler herds should be introduced. I mention again the problem of extra milk, the quota and the super-levy, and how that problem could be addressed. Finally, the earliest possible removal of the ban on Northern Ireland beef exports is vital.
Last March, the British Government pledged themselves to do everything possible to safeguard the beef industry. It is now important that the Government display that commitment by an immediate action programme in some—I hope all—of the areas that I have indicated.
744 There has been throughout Europe a total acceptance of Northern Ireland's low level of BSE and of our much better traceability system. Such acceptance must be backed and strongly supported with an action plan that is capable of immediate implementation. Farmers demand and deserve that immediate action, and they look to the Government to provide it. Perhaps there will be some indication that the Government will take such action when the Minister winds up this debate.
In my opening remarks, I referred to the great famine in Ireland 150 years ago, and said that the BSE crisis is the greatest disaster to hit the farming community in Northern Ireland since then. At the time of the famine, Britain was accused of standing by and doing nothing. I hope that history will not repeat itself.
§ Mr. Deputy Speaker (Mr. Michael Morris)Order. It is clear that four Back-Bench Members wish to contribute to the debate. We have 50 minutes left, which includes the time for the winding-up speeches. I make an appeal for short, succinct speeches.
§ 10.8 am
§ Mr. Michael J. Martin (Glasgow, Springburn)I am grateful to the hon. Member for South Down (Mr. McGrady) for initiating the debate. He reminded us several times of the famine in Ireland 150 years ago. Had it not been for that famine, I might have been a resident of County Cavan instead of living in the west of Scotland, where there is a large Irish community. Names such as Murphy and O'Neil suggest that the famine, which caused terrible hardship in Ireland, brought people to Scotland to seek a livelihood.
The Glasgow meat market is in my constituency, and I should stress that, with all due respect to the farmers, they are not the only people affected by the BSE crisis. I am not trying to underestimate their problems, but people living in the cities also face difficulties.
I understand that 5,000 head of cattle per week are being slaughtered in Scottish abattoirs. Those cattle do not have BSE; they are perfectly healthy animals that happen to be more than 30 months old. I should put it on record that, like Northern Ireland, Scotland has not been affected by BSE.
Recently, I had the pleasure of visiting Mr. Alec Henderson, who has a farm on the outskirts of Glasgow. He told me that butchers throughout the west of Scotland can put notes in their windows stating that their meat has been supplied by Mr. Alec Henderson, and that is sufficient assurance that it is BSE-free. I hope that the Minister recognises that many farms in Scotland are BSE-free because the farmers feed their cattle with produce that is grown on the farms. They do not use artificial feeds.
It has been estimated that, of the 5,000 head of cattle that are being slaughtered each week, 1,000 are destroyed in the Glasgow meat market. The Scottish Office has taken the same approach whenever there is a crisis—it has passed on the problem to someone else. In this case, a so-called liaison committee has been created in Scotland, and Ministers have allowed it to rule the roost.
It is clear that some people will make a fantastic amount of money out of the crisis. One does not need to be a mathematician to work out that, if 1,000 head of 745 cattle pass through one meat market every week, and, having been destroyed, their skins are sold to the leather tanneries, some people will make large sums of money. Yet, at the other end of the scale, farmers and wholesale butchers will lose.
If 30-month-old cattle have to be destroyed in the meat market, the wholesale butchers who have operated in the Glasgow meat market for more than 100 years will not be allowed to slaughter the meat they sell there. Thai will have the ludicrous result that wholesale butchers who operate in the Glasgow meat market will have to go elsewhere to slaughter the cattle that are normally killed in the market.
In today's short debate, it is hard to describe the Glasgow meat market, but I should mention that it occupies considerable acreage in my constituency. People tell me that, if 1,000 cattle pass through the meat market every week, there must be employment there, but there will be a price. As I have said, the wholesale butchers will have to consider leaving the premises that some of them have occupied for more than 100 years.
We must also consider what will happen after all the cattle have been killed. In my constituency, there will be a great empty building that no one will want. I know that that is the responsibility of the Scottish Office, not the Minister who is present.
§ Mr. Deputy SpeakerOrder. The hon. Gentleman has been in the House for many years. He really must relate his remarks to the Northern Irish cattle coming through the Glasgow meat market; otherwise, he will be out of order.
§ Mr. MartinI apologise, Mr. Deputy Speaker. Perhaps I should have explained that the Glasgow meat market was built not only to deal with home stock, but to cope with the Irish market. Irish cattle also come through that market, and that is why I am participating in the debate.
I refer to the point raised by the hon. Member for South Down about the crisis in the rest of the United Kingdom. I am often reminded by some of his colleagues in the Ulster Unionist party that Northern Ireland is part of the United Kingdom. Irish farmers and the Glasgow meat market have been affected by the BSE crisis.
I stress again that some people are making an awful lot of money out of the crisis. I shall not say too much about that, but some of those on the so-called liaison committee are set to make a financial killing. I am not suggesting that they are dishonourable, but I am concerned that they may have a conflict of interest.
The Scottish Office has put such pressure on the cattle markets, that, as we have discussed in the House, there is concern about the welfare of animals which have to wait in trucks for hours on end. I hope that the Minister will take my concern to the Scottish Office, that, unless some of the smaller abattoirs are reopened, cattle will continue to suffer while they are waiting for slaughter. No one in the House or the country wants to see that.
Finally, we have to consider the head boners in the meat industry. They do not have a very pleasant job, but they have worked hard, honestly and in good faith. 'The Scottish Office told them to cease business, yet they have received not a ha'penny in compensation. Some of those men and women worked for 20 or 30 years in that industry and received no complaints about hygiene or any 746 other aspect of their work. They were told to cease trading, and some of their mortgages and businesses have been threatened. Business in that industry is now non-existent.
If Ministers can tell the Tory party conference that the farmers will receive compensation, they should consider other people who are involved in the meat industry. Let me say, with no disrespect to the farmers, that others in the industry are also losing financially.
§ Mr. William Ross (East Londonderry)We have listened to two very interesting speeches. I assure the hon. Member for Glasgow, Springburn (Mr. Martin) that those of us who take an interest in the cattle industry understand that its effects extend far beyond the farm gate. I am sure that, like me, he is grateful to the hon. Member for South Down (Mr. McGrady) for raising this matter. It gives us a chance to express yet again concerns that we all have about the industry, the many ramifications of which were totally unforeseen until the disaster struck.
The hon. Member for South Down has rehearsed the concerns fairly comprehensively, and therefore made it easier for those who follow him to cover the matters on which he has given details. There are also, however, one or two matters that he missed.
As he pointed out, Northern Ireland exported 80 per cent. of its beef. A considerable amount of that entered Great Britain and, to some extent, Northern Ireland was caught by the ban on British beef. It seems that the Irish Republic has escaped because it is a separate country, yet it has an incidence of BSE that must be extremely worrying to Mr. Yates and members of the Irish Government.
The British beef market was immediately depressed as soon as Northern Ireland beef entered it—such beef had no place else to go. If we resolved the problem of Northern Ireland beef, it would therefore relieve the downward pressure on the entire British beef market and tremendously benefit all of us—not least the constituents of the hon. Member for Glasgow, Springburn.
Northern Ireland can, of course, meet the accredited herd requirements much quicker than the rest of the United Kingdom, but even if the European Community accepted the Government's accreditation scheme, it would still demand that the UK abide by the Florence agreement. The Government are trying to shut their eyes to this real and major problem, but I do not think that it will go away.
In order to comply with the scheme, Northern Ireland needs to slaughter about 2,000 cattle in 790 herds—not very many cattle per herd. On top of that, there is a backlog, to which the hon. Member for South Down referred, of 90,000 cattle, comprising 40,000 30-month-plus cattle and perhaps 50,000 cull cows, which is a fast-developing problem for farmers in terms of feed, shelter and wet land. Land is very rapidly becoming wet through.
If Northern Ireland could resume its exports beyond the shores of the nation, it would immediately benefit its farmers and the general economy there, and, as I have said, reduce the depressant effect of Northern Ireland beef on the Great Britain market, which would relieve problems and give a tremendous lift to the income of Great Britain beef producers.
747 The Government seem to be taking the view not only that is the Florence scheme atrociously expensive—which it is—but that it is unnecessary on any scientific grounds. I happen to agree with them. Perception is the determining factor. I fear that perception will be the determining factor in another matter that will come before the House this afternoon.
The Government believe that, by removing the 20 to 25 per cent. of beef in the market by the methods that have been and are presently deployed, a balance will be created between production and consumption, and therefore nothing more will be needed to be done. That may be true, but even if it is, there is a great chasm between where we are and that happy outcome. We need a bridge to get from where we are to where we have to be.
What needs to be done to resolve the problem in Northern Ireland? I speak about Northern Ireland not only because it is the subject of this debate but because of the ramifications it has for the rest of the kingdom. If Northern Ireland can clear the backlog, it can reach compliance with the accredited herd scheme standards. That means slaughtering the 2,000 cattle in Northern Ireland, which is proving to be the road block.
We should not be mistaken about the fact that the EC will use the fact that those 2,000 cattle are not slaughtered as a road block to reopening the export market for Northern Ireland cattle. That tiny number of the total national herd must be taken out of the equation as quickly as possible. If that is done, we will be able to export beef not only to Great Britain but—I hope—much further afield.
The hon. Member for South Down also referred to the problem of flagged holdings, which I agree must be addressed and resolved urgently. If it is not resolved, supermarkets will try to outdo each other in the purity of the products on sale. That will simply mean that they will not be willing to sell beef from a flagged holding. That would be a serious marketing problem. It is not very often mentioned, but it must be borne in mind. The Government must sort out this crazy system of flagging holdings rather than cattle.
The Government must understand that their efforts to reduce compensation for 30-month-plus cattle is totally wrong. Why should those who have had to keep their cattle the longest wind up with the least money? Farmers are well aware that, when a small technical change appears in the press or is announced from a Government source, it might not seem very significant, but it often represents a difference as great as that, which we in this House know from legislation, between "may" and "shall".
Farmers want to reduce the weights for cattle for which they will be able to claim compensation, but once they do that, they run across the age-weight problem. In order to get the second punching, cattle have to be kept until they reach a certain age. If they are kept until that age, they are over the weight. The farmer has a nice little choice. He can forgo the second punching, which involves a considerable sum at the moment, or go over it and run foul of the weight restriction. The Government must be a little more honest in dealing with that.
There has to be a serious and sustained effort to ensure that all farmers get away a proportion—which they expected from the very outset but has not materialized— 748 of their cull cows and 30-month-old cattle so that there is no favouritism. Let us be clear. If the Government had taken on the job of running the scheme themselves, there would not have been any favouritism. We might have had a moan, but there would not have been favouritism.
We know of farmers whose cattle have been listed for slaughter from the first day, but who still have them, yet dealers seem to be able to buy them and get them off their premises in a day or two. That is causing great resentment among the farming community. Farmers also think that, whenever they try the help line, the telephone must have been left off the hook.
What information has the Department of Agriculture, Food and Forestry in Northern Ireland made available to the meat plants regarding the number, types and age of cohorts of cattle on farms in Northern Ireland? It has been put to me that it is possible for meat plants to tap into the central computer. If that is so, information that should be commercially confidential to farmers is available to meat plants, which is very much to the commercial advantage of the meat plants and the disadvantage of the farming community. The system was never designed for such use, and I should be glad to have an assurance that what I have been told is incorrect.
If the Government cannot get rid of the backlog, would they be prepared to buy up the cull cattle and arrange for the feeding of them so that use can be made of the feed that is lying around? People are frightened to buy that feed. People who are losing between £200 and £300 a head on last year's cattle are in no position to go to market this year. But they may have some feed left, and that could be used. People will not take action off their own bats, but if the scheme that I believe has been suggested by the Ulster Farmers Union were put into operation, it would go a considerable way towards helping to resolve the problems we face now.
§ Mr. Malcolm Bruce (Gordon)I am grateful for the opportunity to speak, and I intend to be brief. I shall press the Minister to answer a particular question. Is there any liaison between the Northern Ireland Office and the Scottish Office, aimed at ensuring that, in terms of the Florence agreement, there is an agreed path towards beginning the accelerated cull, at least in Northern Ireland and Scotland, and that that can be put forward as part of the United Kingdom proposals under the agreement?
I am sure that hon. Members from Northern Ireland will agree when I tell the Minister that, if the Government simply stand by what the Minister of Agriculture said in the House on Monday, there will be not only anxiety but anger in Scotland and in Northern Ireland, because the interests of people there are being sacrificed for the sake of the division of opinion within the United Kingdom. What I propose seems to be within the Government's power, even considering the understood difficulties that they face.
The Minister must accept that Northern Ireland has an especially good record on the incidence of BSE, and also has a traceability scheme. Scotland comes close behind in terms of its incidence, which is falling, and also has an accreditation scheme. The scheme would be better if it were fully computerised, and we would like help from the Scottish Office so that that can be done.
It is not acceptable for Scottish and Irish specialist beef producers to be told that, despite assurances by the Prime Minister, no less, that, under the Florence agreement, 749 there would be progress towards the lifting of the ban, and despite the recognition that Scotland and Northern Ireland could be in the vanguard of the process, their interests will not be taken forward.
Everybody recognises that the problem cannot simply be regionalised. That would be an over-simplistic solution. But we cannot allow the present state of confusion, disarray and shambles to continue, with specialist beef producers given no idea of what they can expect. They are now buying cattle at 25 to 30 per cent. below last year's market prices, in the hope that the home market will hold together and that there will be no further crisis to depress prices. They have to gamble on whether the export ban will be lifted within the maturation period of the cattle now coming on to the market. That is a pretty difficult situation for farmers to operate in.
The hon. Member for Glasgow, Springburn (Mr. Martin) talked about his local special interest, but I believe that in my constituency I may have a greater concentration of beef production in all its aspects, across the board and from start to finish, than any other Member who represents anywhere else in the United Kingdom.
Of course it is not only farmers who are affected. Cattle marts, abattoirs, refrigeration and transport companies and a variety of other service companies are affected, too. Thousands of jobs are at stake and thousands of incomes severely depressed. People face potential ruin. Yet, six months into the crisis, the Government have not even carried out their basic undertakings to the European Commission, which were to put forward detailed proposals on how to implement an agreed cull.
Worse than that, the Government are now backing off, saying that they are not sure whether there is a case for going ahead with the cull that they previously agreed. The hon. Member for South Down (Mr. McGrady) is right to say that the good will that has existed so far within the European Commission will evaporate if we do not make detailed proposals, as we have undertaken to do.
It is not good enough for Ministers to say that there is new scientific information. There is always new scientific information. That is the nature of science—and it is no excuse for not having made proposals on the basis of the scientific information available. If that includes a Government belief that, since the Florence agreement, new data have appeared that affect the outcome, let us by all means incorporate them into the detailed proposals.
Farmers in Northern Ireland and Scotland, and all those whose work is ancillary to the beef production industry, demand that the Government take action under the terms of the Florence agreement. Will the Minister tell me whether there is active discussion between his Department and the Scottish Office so that they will be able to lead the way for the United Kingdom out of the bind, and implement the Florence agreement?
§ Rev. William McCrea (Mid-Ulster)I congratulate the hon. Member for South Down (Mr. McGrady) on his timely action in bringing this matter before the House. I assure him, and the leader of his party, that the leader of my party and all its Members will join the other Members of the House, especially those from Northern Ireland, in making a united case. That has been happening already. Only the other day, the three Members of the European Parliament for Northern Ireland stood united, shoulder to shoulder, on the important issue before us.
750 I am delighted that the Minister of State is at the Dispatch Box to answer the debate, because I believe that he is genuinely interested in all matters relevant to the Province.
Sad to say, while we were facing a great crisis, other European countries tried to take advantage of the problems facing our beef industry, and of the British horror scenario. But for some of them it backfired. They intended to enter the markets to take advantage of our tragedy, but found that raising the issue backfired on them at home.
The crisis affects not only agriculture but Northern Ireland as a whole, because the beef industry is our chief industry, and is worth £500 million to the Northern Ireland economy. It employs not only 25,000 people directly, on the farms and in processing, but many thousands of others in packaging, transport, distribution and sales. That is why the spin-off from the tragedy is hitting so many of our people. If decisive action is not taken soon, there will be no beef industry left. Radical steps are needed to restore confidence.
The ban on beef exports hits Northern Ireland especially hard because, as has already been said, 70 to 80 per cent. of all our beef production is sold outside the Province. Therefore, the fight must continue to establish that Ulster beef should have a BSE status separate from that of the rest of the United Kingdom.
Many of the reasons have been outlined already. Compared with the mainland, there is a minimal incidence of BSE in Northern Ireland; 34 per cent. of herds on the mainland have been struck by BSE, but only 3 per cent. of the herds in Northern Ireland. In Great Britain, 160,000 BSE cases have been recorded; the figure for Northern Ireland is 1,600. Yet Northern Ireland has more than 10 per cent. of the United Kingdom beef herd.
The main difference between the situation in Northern Ireland and that in the rest of the United Kingdom is that a full record is kept, which means that the background, health and contacts of all cattle are fully traceable. It has been acknowledged that we have one of the best schemes anywhere in Europe. Not only that, but other countries in the European Community have acknowledged that we have the best beef production anywhere in the world.
I know of countries that would be proud to accept Ulster beef, and delighted to sell it on their markets—but unfortunately, because of the decision in Europe, that cannot be done. I believe that the quality of our beef can meet the challenge of that produced anywhere else in the world, and that we could market it. But market outlets in Europe and beyond have made it clear that, although they would be prepared to sell our beef, they are prevented from doing so. The case for a separate BSE status for Northern Ireland beef is unassailable.
The farmers are the innocent people in the story. They did nothing wrong. They listened to the guidance given them by the Department. Yet despite that, they are paying the price. We must recognise that the farmers did not do something wrong to make a quick buck or a quick pound, and the Government owe it to a vital industry to compensate them during this great crisis.
It is sad to see big men in markets with tears in their eyes as they give away their cattle, but they realise that they cannot keep the animals, as they do not have feedingstuffs for the winter. The farming industry must 751 not allow any dealer to make himself fat from the horror and tragedy that many ordinary decent farmers are facing because of these burdens.
As summer comes to an end, feeding cattle outside will be drawn to a conclusion. We are now entering the winter months, and many farmers will not have the finance necessary to provide food for their animals. I know of farmers who have gone to the bank and have been told not to write another cheque—not even for food for their own families. We must remember that many banks encouraged farmers to borrow, but—at the first sign of crisis—they will not even allow a farmer to write a cheque to put food on the table for his family. This is a human crisis, as well as an appalling crisis facing the industry.
In a recent debate in another forum, it was unanimously demanded that Northern Ireland be recognised as having special status for BSE purposes, so that the worldwide export ban can be lifted as quickly as possible; that the backlog of cattle in the over-30-month cattle slaughter scheme be eliminated; that BSE flagging should apply to herds, and not holdings, and that a voluntary buy-up scheme be introduced for BSE flagged suckler herds; that specific beef intervention for Northern Ireland be introduced; that the Government provide fair and adequate compensation for beef producers in keeping with their previous commitments; and that the HLCAs be increased in the autumn review.
These points have been unanimously expressed by hon. Members today. I hope that, as a result of the political unanimity in Northern Ireland, the Minister will concede our request, and that the Government will take urgent action on this very important issue.
§ Mr. Eric Illsley (Barnsley, Central)I add my congratulations to the hon. Member for South Down (Mr. McGrady) on raising this important issue, and congratulate the other hon. Members who have taken part in a well-informed debate. The debate is especially timely, as it follows the Government's decision not to proceed with the selective cull of cattle, along with Monday's meeting in Northern Ireland with members of the European Parliament and the President of the Council of Agriculture Ministers.
The crisis has been with us since March this year, and we appear to be no further forward in our efforts to lift the European ban. The importance of the beef industry to Northern Ireland has been mentioned this morning and previously in the House. The export trade is valued at about £500 million, and 80 per cent. of beef from Northern Ireland is exported—mainly to Europe. More than 16,000 farms rely on cattle to some extent.
Yet, at the same time, the incidence of BSE in Northern Ireland is about l per cent. of the United Kingdom rate. That is mainly due to the traceability systems in operation in Northern Ireland, which must be replicated throughout the rest of the United Kingdom if we are to reduce the incidence of BSE and create the conditions to allow the ban to be lifted. The Minister of Agriculture has circulated a letter to all hon. Members this morning that refers to the proposed passport system, which will go some way to addressing the concerns.
The fiasco since March has continued because of the possible link between Creutzfeldt-Jakob disease and BSE, and the implementation of the ban by the European 752 Parliament. We do not appear to be any closer to the lifting of that ban, despite the Government's decision to cull all cattle over the age of 30 months. Problems have arisen with that cull as a result of the lack of rendering capacity and cold storage, both of which have been mentioned this morning. There have also been allegations that some abattoirs have been selected in preference to others, and will be allowed to profiteer at the expense of the other abattoirs.
On the question of cold storage, I understand that another £16.6 million has been made available for extra cold storage facilities. An article in The Guardian last Friday referred to the possibility of the Government hiring cold storage ships to meet the demand for facilities as our existing cold storage facilities are—or will shortly be—exhausted. It is also argued that the £16.6 million has been made available by reducing the compensation payments that have been made to farmers affected by the crisis.
The lack of rendering capacity and cold storage are examples of the incompetence of the Government in dealing with this issue. The cold storage is necessary, and the backlog must be addressed. We have heard several times—and heard again this morning—that farmers are now facing the costs of food and shelter for their animals as we approach the winter months.
The backlog in Northern Ireland of animals in the over-30-month scheme is about 90,000, and this must be addressed. We are also conscious that farmers with animals that are waiting the longest to be part of the cull will be given the least compensation, as the Minister's letter tends to confirm. He said that market conditions have now led to a reduction in the compensation that is to be made available.
In June, the Florence summit set a framework that, we were led to believe, could have led to the lifting of the export ban. The summit proposed five stages and a number of preconditions that had to be met by the Government before the Commission would consider lifting the ban. The Prime Minister told the House that the stages would be considered only and exclusively on the basis of public health, objective scientific criteria and the judgment of the Commission. It is important to recognise that the objective criteria will be judged by the same scientists who recommended the imposition of the export ban.
The preconditions include the accelerated selective slaughter programme, which will try to accelerate the decline in the incidence of BSE. That programme was approved by the Commission, and the number of cattle suggested for that cull varied between 20,000 and 150,000. Other preconditions were: the recording of movement, identification and registration; the removal of meat and bonemeal from feed and farms; the confirmation of the over-30-month culling scheme; and improved procedures for the removal of specified bovine materials from carcases.
The Prime Minister said that, if those conditions were met, the export ban could be lifted over five stages. But he also said that the ban could be lifted by October, and it is quite clear that he was way off the mark. Those stages related to certified herds, animals born after a specified date and the export of embryos—which would come later—and meat from animals under 30 months of age.
The ban on meat from animals over 30 months would remain, but the basic preconditions were that the cull of animals aged over 30 months should continue and that the 753 accelerated selective cull should take place. There have been delays in the over-30-month cull—as I have state—hut the selective cull was suspended by the Government in the week of 20 September 1996.
As luck would have it, I was in the European Parliament the following morning when Commissioner Franz Fischler addressed the Parliament on agricultural issues, and I can tell the House that he was completely surprised by the Government's decision to suspend the scheme. Most of the MEPs in the Chamber—I spoke to a few—were also surprised by the Government's decision. That raises the question whether the European Commission was consulted before the Government decided to suspend the cull. Obviously, that was done on the basis of the Oxford study, which mentioned the phasing out of BSE, by 2001.
As the Minister repeated in the Chamber on Monday, however, there are signs that European member states would not agree to lift the ban even if the selective cull took place. What evidence is there for that? If the Minister cannot answer today, perhaps he can write to me once he has consulted the Minister of Agriculture.
The reaction of the Commissioner in the European Parliament that morning was that he had not been consulted. He gave no sign that there would be any reluctance on the part of the Commission to the lifting of the ban if the selective cull took place. One thing was clear when he addressed the European Parliament that morning—he said that the conditions of the Florence framework still stood. Regardless of the Oxford study and the Minister's view of what the Commission might or might not do, the Government would have to meet the conditions of that agreement before the ban could be lifted.
At the moment, we are unable to meet two of the conditions of the framework. We cannot achieve the over-30-month cull until later this year—probably into next—and we cannot achieve a selective cull, because of the Government's attitude to the Commission and their belief that the Oxford study suggests that whatever we do would make no difference.
I agree with the hon. Member for Gordon (Mr. Bruce)—what are the Government going to do? Are we going to wait until 2001 to discover whether BSE dies out? Or are the Government going to take action to renegotiate the Florence framework to put in place a proper timetable? It is all right the Government saying that the Oxford study says that the selective cull is no good. The National Farmers Union said as long ago as July that such a cull had no scientific basis. The Commission is sticking to the Florence timetable, and the Government have to take some action to get the framework in place so that the ban is lifted.
The idea of certified herds is welcome for Northern Ireland, which has had fewer than 2000 cases of BSE—46 this year. A selective cull would enable Northern Ireland to meet the Florence framework; I endorse the words of the Minister of Agriculture, who said that the certified herd system lent itself well to Northern Ireland.
Better news for Northern Ireland came from the meeting on Monday between Members of the European Parliament and the president of the Council of Agriculture Ministers, which suggested that initiatives could take place to enable Northern Ireland to meet the Florence framework. I agree with Mr. Yates, who said that they 754 had set out a route for a regional initiative, and that the British Government should treat Northern Ireland as a first pilot scheme for implementing the Florence agreement on selective culling. The Government should allow Northern Ireland to meet the conditions, and thus enable the ban to be lifted in the Province.
§ The Minister of State, Northern Ireland Office (Sir John Wheeler)It is always a pleasure to follow the hon. Member for Barnsley, Central (Mr. Illsley) and I shall try to pick up as many of his points as I can. He invited me to write to him if I could not answer one question in detail, and I undertake to do so during the next few days.
This has been a particularly important debate for Northern Ireland, as has been evidenced by the number of Members representing Northern Ireland who have attended. They have included the right hon. Members for Strangford (Mr. Taylor) and for Lagan Valley (Sir J. Molyneaux) and the hon. Members for Belfast, South (Rev. Martin Smyth) and for South Antrim (Mr. Forsythe), as well as those who managed to catch your eye, Mr. Deputy Speaker.
In the few minutes left to me, I shall certainly try to pick up as many points as I can. I, too, congratulate the hon. Member for South Down (Mr. McGrady) on the way in which he opened the debate. He spoke for the farming community and all the political parties in Northern Ireland by expressing in some detail his concern about this important issue, which he correctly described as one of the greatest setbacks in the past 150 years. That was a theme of many of the other speeches.
I shall try to answer as many of his questions as I can to help him. He spoke about speeding up the over-30-month cull. By the end of October, I hope to be able to double the rate of the cull to 8,000 animals a week. As I understand it, the Lisburn facility will be fully operational again on 28 October, more cold storage space is being made available, and there is no shortage.
Since the beginning of the crisis—that is a greatly overused word in this place, but it is correctly employed when dealing with this subject—all but one of the Northern Ireland tenders have been met in full. The Government are consulting the farming unions in Northern Ireland on how the additional £60 million is to be spent.
With regard to the Florence agreement—the hon. Member for Gordon (Mr. Bruce) also intervened on this subject—the selective cull is only suspended, and the Government are proceeding in accordance with that agreement, looking at all the scientific evidence, and in consultation with European Commission authorities.
The hon. Member for South Down asked whether the Government could guarantee that intervention tenders would be met in full in future. That is for the European Union beef management committee to decide. The Government will press for all tenders to be awarded in full. He also asked about calf sales. So far, calf prices in the autumn sales in Northern Ireland are holding up well.
As one might suppose, the hon. Member for East Londonderry (Mr. Ross) spoke with his customary authority as a farmer. He properly reminded the House that the problems affect the community as a whole, and 755 extend well beyond the farm gate. He is right. The hon. Member for Glasgow, Springburn (Mr. Martin) also pointed that out, and raised a number of questions relating to Scotland, which my colleagues in the Scottish Office will be interested to consider.
The hon. Member for East Londonderry also spoke about the help line telephone being off the hook. I take that seriously. The responsible officials will look into that matter to ensure that, when the telephone is used, help is available to those who seek it.
If the Government get approval for the certified herd scheme, they will consider the selective culling of the 2,000 or so animals in Northern Ireland. The hon. Gentleman also mentioned the over-30-month scheme. I can tell him that meat plants cannot tap into the Government's computer, as that would be illegal under the Data Protection Acts—a real constraint. The Government could have run the booking system more fairly, but the problem with that suggestion is that commencement would have been significantly delayed.
The hon. Member for Mid-Ulster (Rev. William McCrea) also spoke powerfully, pointing out that all Northern Ireland is united in trying to deal with the problem. The European ban on exports of British beef and beef products is damaging the livelihoods of all those dependent on the beef industry, and arguably nowhere more so than in Northern Ireland, with its heavy dependence on exports to Europe and beyond.
It should be noted that, before the EU ban was imposed, between 1991 and 1995 farm incomes in Northern Ireland had risen by about 91 per cent. in real terms. Now, the effects of the ban are being felt much more widely in Northern Ireland than simply in the agriculture industry.
Reference has been made to the special arrangement for Northern Ireland, and I shall say briefly in the minute that I have left that the answer, the Government contend, does not lie in that direction. The solution is—
§ Mr. Deputy SpeakerOrder. We must now move on to Her Majesty's Government's policy on Latin America.