HC Deb 18 November 1998 vol 319 cc876-96 10.59 am
Mr. Nigel Evans (Ribble Valley)

I am grateful for the opportunity to speak on this subject, and I am sure that hon. Members will forgive me if I start with livestock before moving to the pig sector. I am also grateful for the support that I have received from a number of my colleagues, including some who are unable to be here but who have contacted me on the subject.

The debate is timely, coming only two days after the announcement by the Minister of Agriculture, Fisheries and Food of an aid package. Farming is in crisis, and it is the worst depression in the industry since the 1930s. Some farmers are leaving the industry because they cannot see any light at the end of the tunnel, and some are leaving because they have no choice as they are going bankrupt. The majority of farmers are staying in the industry, but getting poorer. Any savings that they have been able to build up through a number of years of hard and long toil have been eaten away and, for some, overdrafts are increasing daily to dangerous levels.

Put simply, the prices paid for animals have decreased dramatically in the past two years. In some cases, farmers are paid less for their animals now than they were 20 years ago. I do not know whether any other industry is facing similar difficulties. Part of the problem is that consumers do not appreciate the fact that that is happening. One farmer told me that 18 months ago he was paid between £1.10 and £1.20 a kilo for his cattle, but now it is between 75p and 80p. For lamb, the price used to be £1.10 to £1.30 and now it is 65p a kilo.

However, consumers visiting the larger supermarkets do not appreciate the fact that such dramatic falls have taken place. Farmers are being bled dry and consumers are being ripped off. Current supermarket prices are a conspiracy to clobber the producer and cheat the shopper. It is about time a new deal was struck for British farmers and consumers, and if our supermarkets are not going to do that job, who will? Lower prices in the shops would at least encourage increased consumption by more people. That is not the answer to all the industry's problems, but one can imagine the anger and frustration of farmers whose incomes have declined dramatically in the past two years when they see others maintaining or even increasing their margins.

The National Farmers Union has predicted that incomes will fall by a further 67 per cent. this year. Clearly, the situation is not tenable. For farmers to be told that aid will help them in the short term is no comfort when the crisis is long term—it has been going on for two years for many farmers. Obviously, banks have become concerned and relationships between farmers and bankers are strained. The banks will not carrying on lending when they see no prospect of a return.

I understand that the Minister of Agriculture, Fisheries and Food will be meeting bankers to discuss the farming crisis, for which I am grateful. Perhaps the Minister can tell us today what his right hon. Friend will say to the bankers when they meet. What fresh hope of an improvement in the plight of farmers can be given to bankers to help them sustain farmers through this crisis?

The majority of my contribution will concentrate on pig farming, but I wanted to put that part of the sector into the context of an industry that is reeling. The £120 million of aid announced on Monday is better than nothing, but that is as much as I can say about it. Will the Minister ensure that that money gets through to farmers as quickly as possible, because those with overdrafts see their bank managers weekly and will need to put it in the bank as soon as possible?

Mr. James Gray (North Wiltshire)

Does my hon. Friend agree that one of the most noticeable features absent from the announcement on Monday was that, whereas £48.3 million is being made available for the beef industry, not one penny is to go to the pig and poultry industries? Does he not think that that is a disgrace?

Mr. Evans

The pig industry has a distinct problem, but the crisis is hitting all sectors of farming. While the Government are targeting certain areas, the pig and poultry industries, which are also reeling from the same sort of problems as the rest of the industry, are getting no support. My hon. Friend is right about that, and I will be interested to hear what the Minister has to say about the rest of the sector in his reply.

Ben Gill of the NFU stated that the £120 million will act as a short-term safety net for some farmers teetering on the brink of financial collapse. Also, interest rates have increased and the extra costs that farmers have incurred as a result more than swallow up the aid package announced on Monday. Frankly, for many farmers the aid package is not only too little but too late. We need a new approach to the industry—one that will give it greater security for the future—and a new attitude on the part of the Government.

The common agricultural policy is a disastrous method of taking money off the taxpayer in large amounts and ensuring that, in some cases, farmers have to live on less than the proposed minimum wage, which is not sustainable. We know that there are inefficiencies within the European Union. Only yesterday, we heard that there have been about £3 billion-worth of inefficiencies/fraud and that the gravy train is speeding out of control. Something needs to be done to deal with the problem, and capital is needed urgently, in particular because the EU is to increase in size and some of the countries that are about to join are enormous producers of agricultural products, which will impact on United Kingdom farming.

Farmers are reeling from lower prices, but they are also swamped by paperwork. There are new rules and regulations and new welfare standards to obey. Costs are being heaped upon them, with Meat Hygiene Service charges the final insult for many. One farmer told me yesterday that he knows of an abattoir owner who has nine employees at the abattoir, plus seven people from the MHS and two vets to inspect what is going on. Clearly that is not sustainable either. All those costs are passed on. When will those escalating costs to farmers and the industry be controlled?

Mr. Keith Simpson (Mid-Norfolk)

Some Norfolk farmers told me last week that a number of inspectors are recruited from eastern Europe and some do not speak English properly. One inspector is from Hungary. This is not an insult to them as people, but obviously the communications problems need to be solved.

Mr. Evans

There is certainly a communications problem, but it may not be between the Hungarian inspector and the people with whom he works. The communications breakdown is between the farmers and those working in the industry and the Government. We need some control of costs so that farmers and people in the industry have some security for the future. For instance, will the Minister tell me whether our continental neighbours face similar costs to those heaped on our industry by the Meat Hygiene Service? Do they have the same sort of hygiene service and similar numbers of inspectors and vets in their abattoirs as in the UK? If not, why not?

The Parliamentary Secretary to the Ministry of Agriculture, Fisheries and Food (Mr. Elliot Morley)

The veterinary inspection procedures derive from a European Union directive and are exactly the same in other member states. Eastern European and other EU vets are working in our abattoirs because of recruitment problems in the United Kingdom, but I assure the hon. Gentleman that all of them speak English.

Mr. Evans

That is reassuring. As the Minister knows, all EU directives are enforced in this country—everything that we sign up to, we obey—but there is widespread scepticism in the industry about whether other EU countries would know an EU directive if they fell over one. The Minister, with his colleagues, must ensure that no competitive advantage is given to our EU neighbours.

Mr. Gray

My hon. Friend is more than generous in giving way twice. Is he aware that the standards of inspection in many European countries are much lower? In France, for example, only a vet is required to attend, whereas in this country a vet and a meat processor are needed. Moreover, in many European countries, inspection is paid for by the Government, whereas in this country the industry pays 100 per cent. of the costs. That is straightforward evidence from the Meat and Livestock Commission of the difference between European countries and the UK.

Mr. Evans

I am grateful for that contribution, which demonstrates the disparity between Britain and Europe. If British farmers and the British industry have to meet all the costs when farmers in other European countries do not, our neighbours will have a competitive advantage in the export market, and British farmers will suffer. That must be sorted out as quickly as possible.

The pig industry has been largely ignored in the current crisis. I saw a photograph of the Minister of Agriculture, Fisheries and Food in his wellies on a farm in Devon—he was surrounded by pigs. That was a great photo opportunity for him, and no doubt the pig farmers there bent his ear about the problems that the industry faces.

I pay tribute to Greg Smith and Philip Edge, two pig farmers in my constituency, whom I consulted in preparing for this debate. Their plight is typical. We must remember that the crisis is affecting small family businesses—individuals whose families have, in some cases, worked for generations in the industry. As my hon. Friend the Member for North Wiltshire (Mr. Gray) said, of the £120 million that was announced on Monday, the pig industry will receive nothing.

Mr. Morley

It did not ask for anything.

Mr. Evans

The Minister says that it did not ask for anything, but it is asking for help. Only a few weeks ago, I attended the Meat Livestock Commission breakfast at which he said: "Of course we know that the pig industry is in deep crisis, but how marvellous it is that it does not get any support." That is like watching a ship going down, not sending any support vessels to help it and, when the ship disappears, saying: "How marvellous. It did not ask for any support." The problem is that it did not receive any support.

Mr. Morley

There are no EU mechanisms on subsidies—as the hon. Gentleman said, the pig industry has never received subsidies. I emphasise that, although the pig industry has asked for a range of measures, which I shall outline, it has never requested direct subsidies.

Mr. Evans

That may be so, but we must recognise that the industry is reeling from the same pressures as the rest of agriculture. It is pointless saying that the sector has not asked for any subsidies; it is asking for help and a range of measures irrespective of subsidies. Farmers in neighbouring countries do not have to face the costs that are being heaped on the British industry.

Pig farmers are deeply concerned about the price that they are receiving for their products. The other day, Farmers' Weekly said: Despite Brussels' recent decision to raise export subsidies, UK prices have continued to slip and are now less than half the cost of production. The number of casualties is mounting, most notably this week with the bankruptcy of Scotland's biggest pig farmer, Arthur Simmers. But the pain is not being shared equally and supermarkets continue to profit from the crisis. Since the market peaked in June last year, producer prices have slumped by a massive 55 per cent. Retail values over the same period, however, have dropped by just 13 per cent.

Mr. Keith Simpson

I am grateful to my hon. Friend for giving way again. He is no doubt aware that Norfolk produces more than one tenth of all this country's pigs; it is estimated by local experts that the county has lost £58 million in the past 11 months because of the crisis in the industry. A farmer told me last week that his family business had lost £7,500. We do not want the Minister to give descriptions of the problems; we want answers to the specific questions that I know my hon. Friend will raise.

Mr. Evans

Norfolk is an important area for pig production, but the whole of the United Kingdom is affected. I have received a letter from the Ulster Farmers Union, whose members are also reeling from the crisis. All sectors of agriculture and all parts of the United Kingdom are affected.

The strong pound has had an impact on exports. Because of the difficulties in Asia and Russia, two markets that the EU has traditionally supplied, there have been many lost contracts, which has led to an over-supply. Moreover, many farmers in the UK and elsewhere have been increasing production to try to make up for the lost money, but that depresses prices even further.

Another problem is the welfare rules. We support the ending of stalls and tethers, but we must recognise that that has led to further costs for the industry. One of my farmers told me that he had had to spend £35,000 on new production methods for his pigs, but that sum is probably at the lower end of the range—some farmers will have had to spend much more than that. Animal welfare policies are being implemented in the United Kingdom well before they are in the rest of the European Union, with which we have to compete.

Mr. John Hayes (South Holland and The Deepings)

The capital investment that my hon. Friend mentions may, on paper, become an asset, but it is hard to do anything with it, as it is not transferable or flexible. It is often said that farmers have a lot of land and capital, but that capital is not very useful in a time of crisis.

Mr. Evans

My hon. Friend is absolutely right. The capital investment is not an asset when the pig farmer has had to borrow the money and now has to pay it back, with interest charges, as prices for his product fall. The welfare standards are tremendous, but I wish that they were met elsewhere, so that farmers in other European Union countries did not have a competitive advantage. What message on welfare standards will the Minister give to pig farmers? Will he ensure that pigmeat coming into this country meets the same standards as pigmeat that is produced here?

Mr. Morley

indicated assent.

Mr. Evans

I see the Minister nodding. We are giving our European Union neighbours, such as Holland, Denmark and France, a competitive advantage. It may be four or five years before some of those countries abandon stalls and tethers, in which time they will be able to kick British pigmeat out of the market and dominate it themselves. In that time, our farmers will go out of business, and it is very difficult for those starting up to make any impact.

Let us not give our neighbours a competitive advantage. We must fight for welfare standards throughout the whole of the European Union. If we are too far ahead of the game, we will do the British industry no service.

Mr. Morley

I well understand the hon. Gentleman's serious point about welfare standards, but I do not agree that our competitors who do not have the same standards as ours have a marketing advantage. The British Retail Consortium's recent announcements about the sourcing of fresh pigmeat and bacon, and about extending the schemes to other processed products, show that our quality assurance schemes and buying practices give our producers a welfare and a marketing advantage over our competitors, as demonstrated by the fact that some of our continental competitors are voluntarily applying the same standards.

Mr. Evans

It remains to be seen what competitive advantage British pig farmers will gain, as 30 per cent. of all bacon goes to catering concerns, which will continue to go on price: if it is cheaper, they will buy bacon from Denmark, where there are stalls and tethers. A lot of bacon goes under brand names, in any case. The Danish pig industry has done a tremendous marketing job for many years. In my local supermarket last week I could not buy any bacon other than Danish, and I am in a rural area. If the supermarkets have shown the way, I do not put much faith in the support that we will get in the future.

I believe that the Minister is considering banning certain antibiotics, including growth enhancers. If that is done simultaneously throughout the European Union, there will be no competitive advantage to other countries, but if we do it even before the science says that growth enhancers are wrong, we will heap more costs on British pig farmers. I understand that, for every £1 that will no longer be spent on antibiotics, £6 will have to be spent on feeding the animals. How does the Minister intend to ensure that any ban is science-based and applied equally throughout the European Union?

Pig feed made from meat and bone meal is banned here, but not in the rest of the European Union. What hope can the Minister give the British pig farmers for progress on that?

Consumers should be given as much information as possible. They do not know that farmers are getting less for their product, because prices in the shops are virtually the same as they were two years ago. How can we ensure that consumers have the information to make intelligent decisions about what they buy?

Pig farmers used to get something for the waste from the pig, but now they get nothing: in fact, they have to pay to get all the waste destroyed.

My greatest fear is that, with all the extra costs and higher standards, British pigmeat will be more expensive and supermarkets will simply go for what is cheaper. Housewives will certainly go for the cheaper option, because many of them are on fixed incomes and cannot afford to make ethical or moral choices. What consultations is the Minister holding on support for the British pig industry?

I read in The Daily Telegraph this morning that 1.3 million extra eggs are being sold every day because Delia Smith demonstrated some recipes using eggs. Do British pig farmers have to rely on Delia Smith to concoct a wonderful recipe including British pigmeat to give the industry a boost, or can they rely on the Minister for some support?

We are looking for a level playing field, even though I hate that phrase. We are in a competitive, cut-throat world, and we are heaping extra costs on British pig farmers, giving the rest of Europe a competitive advantage. The industry will be listening when the Minister replies.

11.24 am
Mr. Alan Hurst (Braintree)

There is all-party support for the British pig industry, and I was a little saddened that the hon. Member for Ribble Valley (Mr. Evans) sought party advantage in what is obviously a dire crisis for the whole of agriculture, and especially the pig industry. The idea of intervention, at which he was hinting, is not historically justified. According to my researches, pig fanning has not historically received state support, and I do not believe that pig farmers want subsidy, although I understand that they face particular problems.

Veterinary inspection is required not only for pigs: I recently visited a turkey farm—run by a family firm since the 1920s—where people made the same points to me as the pig farmers made to the hon. Member for Ribble Valley. They are most anxious that the charges for continuous veterinary inspection should be on a headage or a weight basis, because the small operator is bound to suffer if there is a time-cost charge. In this time of agricultural crisis, I see some merit in the Government's at least considering some assistance with the cost of veterinary inspection for those involved in animal husbandry.

Mr. Hayes

One understands that universal subsidies cannot be applied across the board, especially in the arable, pigmeat and poultry sectors, but specific, targeted and focused help for exactly the sort of producers that the hon. Gentleman highlighted—in Essex and Lincolnshire—might have been expected from the statement earlier this week. I hope that the Minister will bring a more helpful proposal to the House.

Mr. Hurst

My judgment was that my right hon. Friend the Minister of Agriculture, Fisheries and Food was warmly received and that it was generally accepted that he had consulted widely and listened, and had taken almost all the financial steps that the hon. Member for South Suffolk (Mr. Yeo) had urged him to take about two weeks earlier.

Mixed farms used to be much more common than they are today and, perhaps not in Norfolk but in many other areas, people used to move into and out of pig farming according to the state of the market, but that is no longer possible, because pig production has become much more capital-intensive. As far as I can gather, all farmers welcome the improvement in welfare standards, but that has added to capital costs, so people can no longer do pigs one year and chickens the next.

I am a little anxious if the only solution to the pig farming problem is thought to be discussions with our European neighbours about bringing all welfare standards up to the same level, because, if we wait for those negotiations to reach a proper conclusion, there will be few pig farmers left in this country to produce a product that has been so successfully improved over recent years.

Encouraging figures were given in a recent Adjournment debate, showing the progress that the pig farming industry had made over the past few years. A much leaner product has been produced to satisfy popular consumption demand. Until recently, the figures showed that the amount of pigmeat exported from this country had almost doubled.

However, what the industry cannot do—we probably cannot do it either, and it has been skirted around this morning as if it does not matter—is to solve the financial crisis in Russia and the far eastern economies. It is not just our pigmeat producers who cannot export to those countries; our European competitors face the same problem. In a declining world market, everybody will jostle and tussle, almost like pigs in a pen, for what is left in the market. I am not surprised that the Danish and Dutch producers are seeking to enter our markets, just as we would seek to enter theirs.

At present, our people are disadvantaged because of the strength of the pound. I appreciate that there is no easy answer to that. In all my reading of the proceedings in this Chamber going back over many decades, I have not yet found any Government saying that it is their policy to weaken the currency. That is not the answer. We have to accept that there is a problem because our competitors' products are cheaper than ours and because they have not advanced as far as we have in welfare considerations. Many of our producers have implemented those welfare considerations voluntarily. We need to be a little careful about horror stories about the wickedness of our competitors. We were warned about that during the beef crisis, when German producers sought to do that about our beef. In fact, they frightened their own consumers so much that they ate less beef of any kind, from whatever country.

It is right to aim some criticism at the supermarket monopolies. They have enormous power in the agricultural community. It is right that my right hon. and hon. Friends at the Ministry of Agriculture, Fisheries and Food have entered into discussions with the supermarket chains, or the organisation that represents them, to secure certain assurances for pigmeat producers in particular and for the producers of more general meat products.

The assurance which already exists is that the product will be labelled according to the country of rearing and birth rather than the country of packaging. It has always seemed absurd to state where something is packaged. There is no earthly point in my being told that Somerset cider is bottled in London. I want to know that it comes from Somerset. The same would apply to any other regional product. I want to know that I am buying British bacon if that is what I choose. I believe that my right hon. and hon. Friends have made considerable advances, bearing in mind the power of the supermarket chains in retail sales.

I believe that things have gone further. As was announced earlier this week by my right hon. Friend the Minister of Agriculture, Fisheries and Food, supermarket chains are saying that, from I January, they will offer for sale only pork or bacon products which are produced to the same level of welfare standards as ours. I have a degree of faith in British consumers and I believe that, once that proposition becomes more widely known, they will seek to purchase our products rather than those which are deemed to have been produced in a less humane manner.

I accept the point made by the hon. Member for Ribble Valley—that, while the supermarket chains are in their benevolent phase, one may be able to make a judgment about what type of bacon or pork to buy, but it is different when one dines in a restaurant. I suppose one could ask whether the bacon on the plate is British. I am sure that the waiter would say, "Certainly sir, of course it is British. We serve nothing else." Of course the restaurant is unlikely to expect anyone to be particularly seeking Dutch or some other sort of bacon. There is a problem, and there is no instant solution.

I am encouraged by the representations that my right hon. and hon. Friends have made to Government Departments to encourage them to consider the purchase of British meat products. Opposition Members sometimes seem to slide back in time and act like socialists of the old school when they ask why it is not possible to demand that the armed forces serve only British bacon. They seem to have forgotten that we now operate in a world of competitive tendering and best value, and that people have no choice but to go for the cheapest as long as it is of equal standard.

We would say that that can be overcome by the proposition that our meat products are of a superior standard and that, even if they are fractionally more expensive, one can still make a choice according to best value. It is not a question of ministerial edict. We cannot say, "You must buy British products." We would have the whole system of European law come down upon us if we sought to restrict our Government Departments to using only our products.

I am encouraged by the steps that the Government have taken so far in the areas where they have the power so to do. I hope that they will consider providing, perhaps at some public expense, the ability to store pigmeat products so as to take them out of the market. I hope that they will also consider some assistance with veterinary charges.

11.35 am
Mr. David Ruffley (Bury St. Edmunds)

I speak as a Member of Parliament in the county of Suffolk. That county relies to some extent on the pig industry for agricultural production.

The crisis in the livestock industry is manifest. The depression facing my county is the worst it has seen since the 1930s. There has been a great deal of constructive dialogue with the Ministry of Agriculture, Fisheries and Food, and I pay particular tribute to those bodies that have advised me and other local Members of Parliament—the National Farmers Union branches in Bury St. Edmunds, Stowmarket, Eye and Stanton, and the British pig industry support group, eastern region, which has been trying to find a way to influence the Government and to brief hon. Members in an effective way.

The small amount of progress that has been made on behalf of the pig industry has, to a large extent, been the result of initiatives taken by bodies outside Government. Although the Ministry has been making warm noises and saying that it wants to listen and consult, in reality the little progress that has been achieved has been the result of direct action by Members of Parliament who have been lobbying the supermarket chains on behalf of the National Farmers Union and other industry groups to try to get some practical measures under way.

One example of those practical measures is the "buy British" campaign. Many hon. Members, including myself, have written to all the supermarkets in their constituencies. I have written to the chairmen and chief executives of all the supermarket chains in my constituency asking them to go out of their way to publicise the benefits of British pigmeat and to organise the labelling on their own-brand products to identify pigmeat as being British reared and produced, not just British packaged.

In a debate in the House in July, initiated by my hon. Friend the Member for Ludlow (Mr. Gill), there was a suggestion that Ministers should do what they could to ensure that, as far as possible, the source of pigmeat used by local authorities for school meals and by the armed forces should be the United Kingdom. I take the point made by the hon. Member for Braintree (Mr. Hurst) that we cannot have a socialist-style diktat to ensure that local authorities and the armed forces' procurers demand British pigmeat. That cannot be achieved overnight.

Nevertheless, under the terms of best value, Ministers should be able, on welfare grounds alone, to flag up the fact that we produce the highest standard of pigmeat. On quality, we are better than foreign pigmeat producers, and price does not come into it. I hope that the Minister will be able to give a detailed explanation of how local education authorities and the armed forces are trying to use British-produced pigmeat. The aid package announced by the Minister of Agriculture, Fisheries and Food did not do anything for the pig industry, and my local NFU representatives will be intrigued to hear claims that there has been no demand for state help or some public spending assistance for the pig industry. However, I wish to discuss not what the Government have not done, but what they can do in the future and I have two specific issues to raise.

My first concern is the level at which supermarkets set retail prices for pigmeat. My hon. Friend the Member for Ribble Valley (Mr. Evans) produced figures that I believe understate the fall in United Kingdom producer prices in the pig industry. He mentioned 55 per cent., and that figure was true in August this year. The Library advises me that 55 per cent. may be the fall in producer prices, but the average fall in retail prices over the same time is 13 per cent. That differential is troubling to pig producers in my county. It is bad enough that producer prices have fallen through the floor, but it is even more galling to discover that the supermarkets' policy is not encouraging British consumers to buy British-produced pigmeat.

What can the Government do about that problem? They may say, "We do not live in a socialist dictatorship: it is a matter for the private sector to determine retail price levels." That is largely true, but Ministers could hold serious discussions with the Office of Fair Trading to investigate the policy under which the price of pigmeat seems to be stuck at a high level when producer prices are so much lower. The British consumer is suffering and so is the British pig producer. My constituents and those who write to me regularly on the subject want to know what Ministers have said to the OFT, and what steps they are taking within the regulatory regime to ensure that falls in producer prices are sensibly passed on to the British consumer.

My second question needs a direct response from the Minister. Our regime for pig welfare is, without doubt, the best in Europe, and probably the best in the world. It was initiated by the previous Government and has been—in my view, sensibly—continued by the Ministry. However, producers in the pig industry are disturbed when they face a regime that prosecutes them for using meat and bonemeal in their pig units or for using sow stalls and tethering, but supermarkets can import pigmeat reared and produced using those production techniques.

If it is illegal for British meat produced in such a manner to be placed on supermarket counters, how can it be legal, just, right and fair for those same supermarkets to sell imported meat produced by the very techniques that are banned in this country? What legal advice has the Ministry received on that point? British pig producers do not have a level playing field, but worse still, potentially dangerous meat products are allowed on our shelves. If meat and bonemeal cause problems when fed to pigs in this country, they must also cause problems in imports from Holland and elsewhere on the continent. I hope that the Minister will answer that question in legal terms, and tell us what advice he has received.

My hon. Friend the Member for Ribble Valley raised a question about the official veterinary inspection service. The number of hours that are imposed on small producers and the cost per hour are increasing. I am indebted to a long briefing by Mr. Arthur Diaper, who is a poultry producer in Horley in my constituency. He gives a toe-curling analysis of the additional costs that he, as a small family business man, faces from the increased inspection charges. He makes a point about inspection levels on the continent, to which I would like a response from the Minister.

The Minister of State wrote to me and said that, if the rules were not observed in, for example, Greece, the Commission could take infraction proceedings. That is the legal position, but, to give confidence to poultry producers such as Mr. Diaper, will the Minister confirm that he will ask the Commission to give examples of infraction proceedings that it has brought against producers outside the United Kingdom, but within the European Union, for breaches of inspection rules and regulations relating to the official veterinary service?

We are told that the issue is a matter for the Commission, but the Minister needs to give confidence to producers in this country that they operate under the same rules and regulations as other parts of the European Union. Nothing less than an assurance that the Minister will talk to the Commission will do for producers in my constituency.

The Minister does his best to be an amiable and genial defender of Government policy, and he and his colleagues do their best to listen. They are good at warm words and the soft, fluffy-edged skills that are so characteristic of the new Labour party. There is nothing intrinsically wrong with that. It makes for good soundbites, and it looks good.

The Minister has been good enough to notify me that he will address a meeting in Bury St. Edmunds next week. That will be the first sighting in my constituency of any shadow Minister or Minister of any description from the Labour party during the three years in which I have been there. It is such a first that we all wonder why he is turning up. If he wants to listen to us, that is fine, but the people who attend the meeting will not want to hear just warm words. They want to know what practical and effective steps the Government will take to help farming in general and livestock in particular.

I should like specific answers to the three specific points that I have raised today, and my constituents would like those answers, too. If the Minister does not reply today, he will certainly be asked for answers when he visits my constituency.

11.50 am
Mr. David Drew (Stroud)

I welcome the opportunity to discuss farming, and I congratulate the hon. Member for Ribble Valley (Mr. Evans) on gaining a debate on both the pig industry and the wider livestock situation. We went along the same path some weeks ago when the hon. Member for Ludlow (Mr. Gill) raised a related issue.

I want to respond to several of the points made by the hon. Member for Ribble Valley, and to make some general points of my own. While he and I can agree that there is a crisis, the House has heard some rewriting of the history of how we got into it, and of how the Government are trying to deal with it. I did not hear the letters BSE emanate from the hon. Gentleman's mouth, but we cannot forget that many of the problems facing British agriculture stem from that crisis. I was intrigued to hear the hon. Gentleman and the hon. Member for Bury St. Edmunds (Mr. Ruffley) say how unfair was the ban on feeding meat and bonemeal to pigs. I challenge them to say whether they suggest that we should end that ban.

Mr. Ruffley

Our speeches made it clear that we welcomed the ban because it contributes to our high welfare standards. The question is whether the same high standards are being observed on the continent, and the answer is that they are not.

Mr. Drew

I thank the hon. Gentleman for that. I share his wish that the same standards should apply. There is clearly a need to pressure retailers, caterers and meat processors, who have not been mentioned so far, into adhering to the same standards.

We have heard a lot about welfare standards. Like other hon. Members, I have spoken to the Meat and Livestock Commission and it would seem, from the commission's consumer profiling, that welfare standards are not foremost in consumption decisions made by individual customers. Interestingly, however, when irradiated food was offered to customers, almost all of them chose not to buy it, despite the inducement of lower prices. There is a job to be done in ensuring that consumers understand the need for higher welfare standards, as well as higher quality and environmental standards. The House, and the trade itself, must ensure that we get that message across to the consumer.

My main point is that we must understand that the pig industry operates in a dysfunctional market. When it comes to the over-supply of pigmeat, one problem not raised so far is that the market is not only open—that has been said—but cyclical, a fact that raises its own difficulties. Many farmers chose to begin production of pigmeat at the very time when excess supply problems were likely, and that has made those problems worse. As my hon. Friend the Member for Braintree (Mr. Hurst) has made clear, the loss of markets because of both declining demand and excess supply, particularly in Russia and south-east Asia, makes it little wonder that we have reached the nadir—at least, I hope we have—of prices and over-supply.

A more difficult tie-in is the fact that some market segments within agriculture are controlled, and others are not. People can see that their livelihoods may be affected by those controls, and that is particularly so for the beef and lamb sectors. There is a temptation to move to the freer market areas, and that has happened to a limited extent in my constituency. My farmers are principally dairy farmers, but there is some beef and sheep production. Some farmers decided 18 months or so ago to move into pigmeat production, and they have caught a cold. They have suffered a difficult decline because agriculture is not—to use a favourite phrase—a level playing field. The field is not even level within agriculture itself, and we cannot underestimate the damage that results from that.

No one doubts that we are discussing changes to our whole production process. Even the laggards in the rest of the European Union, let alone those in the rest of the world, understand that we are moving away from supply constraints towards lower prices with direct support. That support may come through mechanisms for environmental support, or it may be direct economic support. My right hon. Friend the Minister of Agriculture, Fisheries and Food announced a package of support earlier this week, and some of us welcomed it greatly. We shall soon see its overall impact on agriculture.

In the meantime, however, we must manage the crisis that none of us would deny. We must realise that difficult decisions are needed if we are to move to freer markets in the medium term, and if we are to recognise more global markets in the long term. As I learn more about farming, I am interested to find that some pig producers in the south-west are already global operators. I have met people who are already farming in Brazil and in eastern Europe. That is not uncommon. To suggest that the problems are purely domestic is to underestimate greatly the significant changes that have happened. That does not detract from the fact that there is an excess of supply, and that that is driving down prices.

Ben Gill, president of the National Farmers Union, has produced an interesting document for the European Policy Forum. It includes a graph showing that the retail price index for all items has risen since 1987 from a base of 100 to 160. The RPI for food only has risen from 100 to about 138, but farmgate prices have dropped off dramatically since about 1996. The graph ends with 1997, and I cannot pretend that the situation has not got a lot worse since then. It is clear, however, that farmgate prices, which had previously risen far less steeply than had the comparable sectors, have declined dramatically since early 1996.

There are serious problems, and we must deal with them. I agree with the solutions suggested by the NFU, and by Ben Gill in particular. We must seek value added at the root of the food chain, rather than having supermarkets deciding their margins, then passing them down the food chain as reverse benefits. That simply is not acceptable. At the same time, we need to recognise that farmers can collaborate more, which may allow them at least to hold down the increases in costs, if not to seek a reduction in costs through economies of scale.

I return to the point that we are moving towards more globally driven markets in all agricultural products, but we must provide opportunities for people to produce on a localised level and seek niche markets.

The pig and livestock sector will recover. It must proceed along a rocky path at the moment, but I have every faith that fanners will find a way to rebuild the sector and ensure a much healthier future.

12 noon

Mr. Martin Bell (Tatton)

I am grateful to the hon. Member for Ribble Valley (Mr. Evans) for initiating this important debate. We shall listen to the Minister with great interest.

We are talking not about a complaint, but about a crisis across all agricultural sectors, which is felt nowhere more acutely than in pig farming. Farmers in my constituency are being driven to ruin. I fear that they will be driven to worse than ruin. There was recently a tragic case of a farmer's suicide in the neighbouring constituency of Macclesfield. We have to turn the situation around.

I shall read briefly from a letter that a pig farmer in my constituency wrote to me. He said: There are no words to describe the financial plight of the pig industry at the moment. It really is criminal what the supermarkets are doing and the government are not doing. The supermarkets are claiming all the rewards from the general public through the drastic price increases they add onto the farmers prices. I am at this time getting half my break even price for my pigs, that is about £30.00 a pig loss and I sell 110 pigs a week. That man has spent £50,000 updating his facilities. He has no way of getting a return on that investment. He is facing ruin, and he sees no future for himself or other pig farmers in the constituency. I wonder what we can do to help. Of course, we look to the Government for action to alleviate the crisis, but we can use the bully pulpits of our speeches, our meetings with constituents and the little articles that we write in our local weekly papers and urge people to buy British. They are patriotic, and they know that we produce the best.

The same applies to our poultry industry, which in my constituency is suffering greatly and is about to suffer even more acutely from the demand that there be full-time vets on site. Family businesses cannot survive in that way.

My father was a fanner and a country writer of some distinction. He farmed through the recession in the early 1930s. In the second world war, he wrote urging soldiers to go back, when the war was over, to life on the farm and agriculture, because then it offered the prospect of a decent living. Now it does not, and I suspect that, if he were alive today, under no circumstances would he make such a recommendation. There is not a living to be made.

The Government must turn the situation around, and I am sure that we, as Members of Parliament, can help. It is the responsibility of us all to make sure that the pig industry survives and that our farms are not a wasteland.

12.3 pm

Mr. John Hayes (South Holland and The Deepings)

I, too, congratulate my hon. Friend the Member for Ribble Valley (Mr. Evans), who, with typical charm and acumen, obtained this debate and started it so well. It is a great pleasure to speak in a debate to which the hon. Members for Stroud (Mr. Drew) and for Braintree (Mr. Hurst) have contributed. They always make thoughtful speeches in our deliberations on agriculture, as do my hon. Friend the Member for Bury St. Edmunds (Mr. Ruffley) and the hon. Member for Tatton (Mr. Bell).

I want to make several points and a plea. First, the greater specialisation that is the consequence of an appropriate drive for quality and the greater focus and expertise that will be produced will make the livestock industry more vulnerable. The hon. Member for Braintree said that, in days of old, people would go into and out of sectors: for example, they would go into pigs or out of poultry. That was also the case in the arable sector. It is becoming less and less true. That specialisation will create an inevitable inflexibility when a particular sector is hard hit, and it must be taken into account in any future regime that we establish.

Secondly, there is an interdependence born of fellowship in agriculture, but there is also a more commercial interdependence. The price of and demand for grain is critical to the livestock producer and the effect on morale of a blow to one part of the industry is felt widely. There is far greater interdependence than is recognised and acknowledged.

Thirdly, demands for quality will also result in a need for greater capital investment. That was mentioned earlier in relation to pigs, but, not wishing to tether us to pigs, I am trying to speak a little more widely. That capital investment will mean that farmers find that they cannot move in and out of products and will exacerbate the trend that I mentioned in my first point. Farmers will also have to borrow more to invest. It is often said that farmers have had good times and now they have bad times, and that they should have spread their money across the years. We all know that life does not work like that, but the claim is particularly untrue in farming, where good years tend to produce the greatest capital investment and lean years mean that farmers depend on that investment to get them through. Greater capital investment is now necessary, and will certainly be significant in the future.

My fourth point is about the extension of Community regulations on co-operatives. We need more co-operation in the industry, particularly on sharing best practice and on more appropriate and more skilled joint marketing. I wonder if it would be possible to extend the Community regulations and directives on co-operatives to private amalgamations and collaborative organisations. A number of those already exist in the arable sector, as the Minister will know, and in the livestock sector. That is a growing trend.

Mr. Drew

indicated assent.

Mr. Hayes

I see the hon. Gentleman nodding. He also mentioned that point. We need to consider how we can most effectively support that trend.

My fifth point is to nail the point about the market. I am a business man and I made my money in business, but we must recognise, as The Times said earlier this week: Market collapse, followed by an exodus of farmers, could threaten the land's husbandry. The Government and public must acknowledge that preventing this costs money. The plant of a fanner—the buildings and the land—is our vista, our horizon and our rural idyll. I know that critics will say that that is a suburban misinterpretation of the rural world, but there is little apart from farming that one can do with land. It is not flexible like commercial property, such as offices and factories. Reskilling and the re-use of plant and investment is much harder in agriculture, and we must acknowledge that the Government will always have to intervene to pay, incentivise and reward farmers for that role in land husbandry. Their countryside is our countryside, and we should not be ashamed to say so.

My plea is for the Government to take a strategic view, and to develop a vision for agriculture. What we had earlier this week—it was presented as nothing else—was an emergency aid package. It was accident and emergency treatment, not preventive medicine. It did not reflect a bigger picture or a long-term goal or vision. If we are to talk about restructuring the industry, we must know into what we are restructuring it.

When the Select Committee on Agriculture considered the beef industry, one of our greatest complaints was that there seemed to be an absence of long-term vision. How big will the industry be? How many producers will there be? What will the level of production be? We need to make those judgments now if we are to work to a meaningful and realistic agenda and give farmers the faith that we have a clear sense of direction that can be coherently and consistently communicated to them. At the moment, everything appears to be reactive. I do not say that particularly of this Government—it is not a party political criticism.

We have tended to react, rather than to plan strategically. That is my plea: let us have a strategic division. Let us not be buoyed by events. Let not Europe dictate the terms. This is a matter of national interest. I shall not repeat all the valid points that have been made about supermarkets, although I could wax lyrical on that topic all day—not that you would let me, Mr. Deputy Speaker.

There is a need for a clearly defined, long-term plan that will be supported by all parties and the industry, and which will revitalise agriculture and give it a place in the next millennium.

12.9 pm

Mr. Patrick Nicholls (Teignbridge)

Because of the short time available to me, I cannot deal in detail with the contributions that we heard from my hon. Friends the Members for Ribble Valley (Mr. Evans)—who introduced the debate and spoke with great passion and concern as he outlined the problems—for Bury St. Edmunds (Mr. Ruffley) and for South Holland and The Deepings (Mr. Hayes). We also heard contributions that we on these Benches have learnt to enjoy from the hon. Members for Braintree (Mr. Hurst), for Stroud (Mr. Drew) and for Tatton (Mr. Bell). It is notable that the only contribution from the Liberals is the fact that one of their spokesmen has just walked into the Chamber.

Mr. Paul Tyler (North Cornwall)

rose——

Mr. Nicholls

The hon. Gentleman is not entitled to walk into the Chamber at the last moment and take up the time of those who have been present throughout the debate. [Interruption.] I shall not give way. The hon. Gentleman should sit down and listen.

The debate takes place against the background of steps that the Government have taken, which I value. In large measure—I do not say this in a partisan sense—those are points that we put to the Government, as did farmers. I welcome the action that has been taken in respect of agrimonetary compensation, HLCA payments and the calf processing scheme. All that is right and proper, and I commend the Government for it.

There has been comment this morning about the amount of money in the Government's package. I do not dismiss £120 million as a derisory sum; it is not. However, the crisis involves far more than money. That contribution represents less than 5 per cent. of the decline in farm incomes over the past three years. If it were simply a matter of money, the position would be entirely different. As we have said repeatedly, what we need from the Government is not so much an effort of money as an effort of will. They must recognise that there is a problem of unprecedented proportions, and be prepared not only to take fiscal measures, but to listen to what people want and to act on it.

The Minister of Agriculture, Fisheries and Food made much play in his recent statement about the arrangement that he had reached with the British Retail Consortium. That has been mentioned in the debate by other hon. Members, and I make no apology for returning to it. Although I particularly enjoy the contributions of the hon. Member for Braintree, he is simply wrong when he sums up the deal—if it amounts to that—that has been reached as ensuring that supermarkets will not sell products that have not been produced to the same standards as ours.

It is instructive to study the short and unhappy genealogy of the deal. In the House on 4 November, the Minister pulled a rabbit out of a hat, if I may mix metaphors. Referring to the British Retail Consortium and major retailers, he said: They have assured me also that, from I January 1999, all pigmeat sold in their outlets will be from animals raised to high welfare standards, with no stalls and tethers and no meat and bonemeal feedstuffs."—[Official Report, 4 November 1998; Vol. 318, c. 952.] The British Retail Consortium promptly decided to reinterpret what it had agreed with the right hon. Gentleman. On 12 November he was forced to say: The British Retail Consortium assures me that its agreement regarding pigmeat sold in its outlets—being stall and tether-free and meat and bonemeal-free—applies to not only fresh pork but processed products, such as bacon, and is being extended to cover ham, sausages and even pork pies."—[Official Report, 12 November 1998; Vol. 319, c. 466.] Great joy and felicitation and the issuing of much bunting, perhaps, but still the British Retail Consortium was concerned about that gloss being put on its deliberations.

On 16 November, the Minister stated: The industry's intention was that that covers not only fresh meats but processed meats, including bacon and products such as pork pies. Supermarkets were willing to take responsibility only for those processed products over which they had direct control—in other words, their own brands.—[Official Report, 16 November 1998; Vol. 319, c. 632.] In that form, the assurance is not worth the paper that it is written on. With their buying power, supermarkets can decide what they will and will not put on their shelves. They have the combined might to tell suppliers that they do not want products that do not meet the standards that apply in this country. The existing assurance is worse than meaningless, although I accept that at the time the right hon. Gentleman must have thought it was an assurance worth having. I hope that the Parliamentary Secretary will tell us what steps the Government intend to take to make sure that it amounts to something.

Steps can be taken now. They require an effort of will from the Minister and his colleagues to stand up for this country's interests in Europe. It has been suggested to me by the National Farmers Union, to which I am grateful for these points, that various steps could be taken with regard to the pig industry. The NFU tells me that it has given the Government evidence that state aid is being given by other countries in the EU, specifically France, to help their domestic pig industry.

We know what will happen. The matter will be investigated, and, in due course, the farmers will be told to give the money back. That is how it is done over there, but it is not sufficient. Farmers are entitled to ask the Government to find out what is going on in the EU and to put their foot down. That requires an effort of will.

Fiscal measures could be taken in the Budget, but I do not have time to go into detail. In Europe, the Government should fight to ensure that export credit guarantees are given so that we can compete on equal terms with the United States. We need an early food package for Russia, coupled with a higher rate of EU export refunds for such commercial transactions as can take place.

It is clear that, at present, there is a surplus in Europe. The Government should vigorously initiate discussions with our EU partners about the steps that will be taken to remove the surplus. With reference to livestock, we have heard what could be done through meat inspection charges in the industry. Time does not permit me to elaborate. We know what could be done to meet the cost of enforcing specified risk material. We know what could be done in terms of the date-based export scheme. Other measures are needed to promote flexibility and an early retirement scheme for farmers.

It is not good enough to claim that nothing more can be done. I have great regard for the Parliamentary Secretary, but it is not good enough for him to bleat, as he did in an intervention, "There is not much that we can do—it is all down to Europe." It is not.

Mr. Morley

I did not say that.

Mr. Nicholls

The hon. Gentleman will want to check Hansard. I made a careful note of what he said. This is not the first time that we have heard the Government say, "We would like to help, but we cannot help because of Europe." We want a commitment from our Government to stand up and fight for this country's interests in Europe. It is no good the Government saying that they represent a bridge into Europe, if their idea of a bridge is simply to lie down so that other people can walk over them.

I want a commitment from the Government to get the right deal for British farmers in Europe, in the same way as the Spaniards seek the best deal in the interests of their fishermen.

I recognise that the Government are taking measures, and that part of the problem is the cyclical nature of the farming industry—there are good years and bad years. However, one overriding issue distinguishes this crisis in agriculture from any other: the Government's mismanagement of the economy. The pig, livestock and poultry sectors are all feeling the effects of a pound that is so strong not as a result of deliberate Government action, but as a result of deliberate Government mismanagement of the economy.

That is why the Government are ultimately responsible for the depth of the crisis. That is why it is fair for the farming industry and Conservative Members to point out that the unique strength of this crisis is the fault of those who inhabit Downing street. I would like to think that, as a result of this debate, the Minister might comprehend the scale of the problem and what Government economic mismanagement is doing to our agriculture. However, I suspect that, instead of comprehension and empathy, there will be a yawning void.

12.19 pm
The Parliamentary Secretary to the Ministry of Agriculture, Fisheries and Food (Mr. Elliot Morley)

I regret that the hon. Member for Teignbridge (Mr. Nicholls) has tried to make a partisan point in what has been a good debate about the real crisis facing agriculture. He suggested that that crisis is a result of the Government's economic mismanagement, when we know very well that much of the pressure on agriculture is due to the collapse of traditional markets, the strength of our currency—although that has devalued by 10 per cent. in recent months—and to a significant increase in production in certain agricultural sectors. There has been a 16 per cent. increase in pig sector production over the past two years. Those factors, as the hon. Gentleman pointed out correctly and fairly in his opening remarks, have contributed to the current problems.

I congratulate the hon. Member for Ribble Valley (Mr. Evans) on a very good and knowledgeable speech, which outlined the pressures that his farming constituent—particularly those in the pig industry—face. I shall try to answer the various points raised in the debate in the limited time available.

Several hon. Members mentioned the supermarkets. They will know that the Office of Fair Trading is investigating the supermarkets and examining such things as the disparity between the prices of goods on the shelves and the prices paid to producers. That report will be published next year.

The Minister and 1 have met the banks—I understand that there will be further meetings—to discuss the current farming situation and emphasise the need for support. In my discussions—I did not meet all the banks, but certainly some of the major agricultural lending institutions—it was made clear that the banking sector has confidence in agriculture and will support farmers, their customers, during this difficult time.

The banks also made several predictions that have so far proved to be quite accurate. At a meeting earlier this year, the banks predicted that the pound would fall in the fourth quarter of this year and that interest rates would peak and decline, and that has occurred. The hon. Member for Teignbridge claimed that interest rates had risen, but they have fallen recently, and the long-term borrowing rate is currently at a 30-year low. The banks also predicted that farm incomes would fall last year and this year, but they are predicting an upturn in 1999. Several factors bear out that prediction.

Mr. Evans

The long-term borrowing rate is mentioned time and time again. Will the Minister concede that farmers borrow not on the long-term rates but on the commercial rates that are available today and those that have been available for the past two years? That is the problem.

Mr. Morley

I think that some farmers do borrow on long-term rates: it depends on their commercial judgment and the size and nature of their operations. I do not think that the hon. Gentleman can rule that out.

Several hon. Members mentioned European Union directives. I emphasise that we comply with those directives in this country, and it is not fair to say that other countries do not do likewise. We have repeatedly told several industry sectors that, if they are aware of disparities within the EU, we will not hesitate to investigate them, raise them with the Commission—the hon. Member for Bury St. Edmunds (Mr. Raney) made that point—and press for immediate action in cases where other member states are not implementing regulations in the same way as we are. I give the House that absolute guarantee.

Mr. Ieuan Wyn Jones (Ynys Mon)

Some pig producers have claimed that France, in particular, is subsidising its domestic industry. Will the Minister challenge that practice in the Council of Ministers?

Mr. Morley

I was about to come to that. We have already challenged it, together with other member states, and France is not paying anything towards its pig industry at present as a consequence. I assure the hon. Gentleman that we will remain vigilant on that point.

I touched upon the issue of competitive advantage earlier by way of intervention. The House may not be aware that United Kingdom exports of pigmeat to Europe this year increased by 17 per cent. on last year, which was a record year. Some 236,000 tonnes of pigmeat was exported from the United Kingdom to the EU. We have some marketing advantages that we can exploit—indeed, we exported pigmeat to Denmark, which is quite an achievement.

Offal control imposes extra costs, and I would not want to pretend otherwise. However, we all know that that is a result of bovine spongiform encephalopathy—the worst crisis to hit agriculture in the history of this country. We are determined to eradicate BSE from the United Kingdom and deal with those problems. Unfortunately, that means that we must have offal control.

Mr. Edward Garnier (Harborough)

rose—

Mr. Morley

I hope that the hon. and learned Gentleman will forgive me, but I want to try to answer the points that have been raised in the five minutes remaining.

The review of antibiotics is an EU issue, and it is being approached in that context. Any change in antibiotics will take the form of an EU, and not a unilateral, measure.

My hon. Friend the Member for Braintree (Mr. Hurst) adopted a very reasonable approach based on significant knowledge of the industry. I welcome his support, and I shall reassure him about storage aids in a moment. The hon. Member for Bury St. Edmunds referred to labelling, supply and flagging up standards in the industry. We certainly intend to address those issues.

Any imports into this country must comply with the law, but we can set higher standards if we choose to do so. We have done that in relation to welfare standards in the pig industry, and I emphasise that that has marketing advantages in terms of meat and bonemeal.

My hon. Friend the Member for Stroud (Mr. Drew) emphasised the importance of consumer choice and marketing. I agree with him absolutely. The hon. Member for Tatton (Mr. Bell) made a powerful case on behalf of his constituents. I assure him that the Government fully recognise the impact of the present difficulties on the agriculture industry. That is why we introduced the recent package, which is in addition to the package introduced last year and the regular subsidies that I will mention in a moment. The hon. Member for South Holland and The Deepings (Mr. Hayes) made several sensible points, particularly regarding marketing and co-operation. The Government will consider how to take those matters forward in the near future.

We have announced a package of £120 million for the livestock industry. The sum is additional to the overall subsidy for the agricultural sector, which is the equivalent of £50 for every man, woman and child in this country. That is a significant amount. I emphasise that the pig industry—on which this debate has focused—is unsubsidised and is a very light EU regime. We have held talks with the United Kingdom pig industry and, although it has certainly requested a package of support measures and equal treatment and raised several points that were mentioned in the debate, it has not asked for any subsidy. The industry asked the Government to take action against French and German state aid to their domestic industries. We have acted on both counts, and neither Germany nor France is supplying state aid to its pig industry. We are trying to ensure that all member states abide by the rules.

Time is limited in terms of compiling a package of measures for the pig industry, but a further increase of 30 per cent. in the rate of export refunds on fresh and frozen carcase meat was agreed on 15 October. At yesterday's meeting of the pig management committee in Brussels, the decision was taken to increase the level of export refunds from 40 to 70 ecu per 100 kg for fresh and frozen cuts and carcases that are exported to Russia. That is a generous increase that reflects both the economic problems in Russia and the position of the EU pig market. In respect of the EU pig industry, the total package of storage aids, which apply in our country, is the equivalent of more than £100 million. That is going towards helping the pig industry now.

I make it clear that considerable financial support is being given to the pig industry, and in practical terms we have raised continuously that industry's high standards. The British Retail Consortium statement was welcome; the major supermarkets have made it clear that they will be sourcing only fresh pigmeat and bacon, and sourcing their own-process brands—including sausages, pies and so on—from systems that produce stall-free, meat and bonemeal-free pigmeat; and we will be meeting the branded manufacturers to find out whether we can extend that to a wider range of products to assist the pig industry.

The Government will not hesitate to give the pig industry, the livestock industry and agriculture in general what support they can. We have shown that, both financially and through our commitment to give those industries the backing that they deserve.