American Food Exports and European Trade Policy

HC Deb 13 May 1999 vol 331 cc432-81

Madam Speaker

We come now to the main business, and I have selected the amendment standing in the name of the Prime Minister.

1.21 pm

Mr. David Chidgey (Eastleigh)

I beg to move,

That this House notes that the EU ban on hormonally-modified meat must end on Thursday 13th May 1999 under World Trade Organisation rules and that the USA is threatening massive retaliatory trade sanctions against member states unless this is adhered to; is concerned that the latest scientific evidence raises serious doubts over the safety of these and genetically-modified products, further undermining consumer confidence; deplores the failure of the EU and the USA to pursue agreed research criteria into the efficacy of introducing such products into the food chain, threatening established World Trade Organisation agreements and ignoring the impact on global biodiversity in the long term; and urges the Government to recognise its responsibilities at the forthcoming Millennium Round and ensure that food safety, the protection of biodiversity and assistance to the economies of developing countries are integral to negotiations on the liberalisation of trade. Today is the day on which, under a World Trade Organisation judgment, Europe must either lift its ban on imports from America of hormonally modified beef or face massive retaliation in the form of trade sanctions. This morning's news has been that the Americans intend to press for sanctions against the European Union. Let us make no mistake about it: if the billion-dollar package of trade sanctions threatened by America starts to hit British exporters, the so-called banana war will seem to have been little more than a skirmish.

The trade war over hormonally modified beef is just a sideshow, however, compared with trade disputes looming over milk products from dairy cattle subjected to the hormone additive bovine somatotropin—or BST—and the proliferation of genetically modified crops and food products.

Unless the world's two major trading blocs—the United States of America and the European Union—start to take seriously their international responsibilities for sustainable trade liberalistion and the protection of global diversity, the trade war could go nuclear. We must not underestimate the seriousness of the issues—which affect consumer confidence in the food on supermarket shelves and the risk of cancer from the milk that we drink, and threaten the diversity of plants and wildlife in our countryside and the economic survival of tens of millions of subsistence farmers in the Indian sub-continent.

Mr. Dale Campbell-Savours (Workington)

Will the hon. Gentleman reconsider what he has just said? He said that the trade war would go nuclear. Does he really mean that?

Mr. Chidgey

I am using a figure of speech to demonstrate the seriousness of the issue. A few weeks ago, there was great debate and concern about the banana trade war, but this issue is massively more serious. I trust that the hon. Gentleman will accept that.

Britain is in a unique position to take a world lead in formulating new guidelines, forging new international agreements, and linking trade liberalisation with the protection of biodiversity and the support required in developing economies.

The Government claim the credit for the United States and European Union transatlantic economic partnership agreement, which was set up while the United Kingdom held the presidency of the EU. The Government claim to be leading EU policy from the heart of Europe. Considering the apathy that is oozing from the European Commission on issues relating to trade in modified food, Britain seems to be not so much at the heart of Europe as in Europe's back pocket. From their belligerent response, the American agrochemical giants seem to think that they have the Government in their corporate wallets. Until the Government set out clear policies and take a lead in resolving the conflicts and the concerns about international trade in genetically modified crops and hormonally modified meats and milk, as well as biodiversity and developing economies, the EU will continue to muddle along and the multinationals will use their muscle to dominate world markets.

The current hiatus over American beef imports is a case in point. It should be no surprise to anyone that the United States is threatening massive trade sanctions if the ban on beef with hormone additives is not lifted. The EU ban was introduced more than 10 years ago in the face of opposition from north America. Instead of putting its house in order and undertaking scientific research to justify the ban, the EU has marked time, dragging its heels while spinning out the Byzantine disputes procedure of the WTO. The EU was given 15 months by the WTO to conduct the additional scientific risk assessments. With only weeks to go before the deadline—today, 13 May—the best that the EU could do was produce an interim report on the 17 new studies that it found that it needed to prove its case. The upshot is that the EU is calling for a further extension of the WTO ruling until the end of this year, to complete its studies. Not surprisingly, the United States, Canada and Australia oppose any extension. The United States is threatening Europe with $1 billion of trade sanctions.

I do not know whether the situation is best described as a tragedy or a farce. The inept, laissez-faire actions of the EU are farcical. Should the massive trade sanctions threatened by America be imposed, it will be a tragedy for the hundreds of British firms whose livelihoods depend on exports to America.

Mr. David Drew (Stroud)

I hope that the hon. Gentleman agrees that under the precautionary principle, delay is the best way forward. We do not know the harm that the products might cause. It is right to delay and look at how we could introduce them properly in the future.

Mr. Chidgey

The hon. Gentleman makes a valid point, which I strongly support. My criticism is that the EU allowed the situation to drag on without investing resources in the necessary scientific research. With food, public safety must come first. Europe has left itself with three options: to maintain the ban on imports and hope to be able to pay compensation to America and Canada through trade concessions rather than suffering sanctions; to transform the ban into a provisional one, which could be argued under WTO rules on the basis of the scientific evidence so far, although that would meet with a host of objections from the United States; or to lift the ban on imports and introduce a labelling scheme to allow consumer choice.

Lifting the ban is clearly not an option. That would ignore the risks to the consumer that the latest round of scientific studies is attempting to quantify and would set a precedent for the wholesale importing of milk products laced with hormone additives, and of GM crops and their products. We need strong action from the EU and strong leadership from the Government to reach agreement on the trade dispute under existing WTO rules. The rules of engagement should be over measures of compensation, not retaliation.

The dispute over the import of beef with hormone additives is merely a forerunner of more far-reaching trade issues coming down the track to meet us. So far, the Government have been singularly silent on their policy regarding consumer choice, food safety, biodiversity and economic developments in developing countries. When the Minister responds, I hope that he will take the opportunity to set out clearly where the Government stand on the issues, what their policies are and what action they propose to take—for example, on the monitoring and management of GM crop cultivation. What action are the Government proposing to allay public fears over the safety of such food products?

With no clear lead from the Government, the public have voted with their feet—or, more accurately, with their wallets. Ten days ago, Unilever—the most powerful player in the global food industry—capitulated to consumer pressure. The company announced that it would stop using GM ingredients in what have become known as Frankenstein food products. Over the following week, just about every other major food company withdrew support for GM food ingredients, removing them from their shelves. Just about the only support left for the products is from the bioscience companies—Monsanto et al—and the Government. The Government have failed to read the public mood, to show leadership and to gain the people's trust as an independent guardian of food safety.

Ms Sally Keeble (Northampton, North)

The hon. Gentleman has said that the Government have failed to do anything on these issues. Could he explain what the proposals for the Food Standards Agency and the proposals on the labelling of GM foods are, if not the Government taking a lead and stating their view?

Mr. Chidgey

I am sure that the hon. Lady can look forward to an opportunity to develop her points later in the debate. However, it is my understanding that those measures have been recognised as totally inadequate, and certainly have not restored consumer confidence. If they had, why would the food producers have withdrawn the products from their shelves?

Ms Keeble

Will the hon. Gentleman give way?

Mr. Chidgey

No, I have given way once and I have made my point. No doubt the hon. Lady will have an opportunity in due course to expand her thoughts and expose herself to interventions to test the validity of her arguments.

Not a day goes by without more horror headlines in the popular press, including warnings that GM foods could cause untreatable strains of killer diseases, such as meningitis. [Interruption.] The hon. Member for Northampton, North (Ms Keeble) may laugh, but I wonder if she laughs to her constituents when they come to her surgeries with their concerns. This is a serious issue, and these are the stories being carried by the popular press. It is the role of the Government to address them.

The Minister of State, Ministry of Agriculture, Fisheries and Food (Mr. Jeff Rooker)

The hon. Gentleman has just linked GM foods with meningitis because the popular press issued such a statement. That was a totally and utterly fabricated story.

The Minister for Energy and Industry (Mr. John Battle)

Will the hon. Gentleman withdraw?

Mr. Chidgey

It is not for me to withdraw a comment on a report from another source.

Mr. Battle

The hon. Gentleman should withdraw.

Mr. Chidgey

If I may, I wish to continue without the sedentary interventions from the Minister for Energy and Industry, who will have an opportunity to respond in due course.

I wish to address the valid point that was made by the Minister of State, Ministry of Agriculture, Fisheries and Food, which I accept. The point that I am trying to make is that, without a clear lead from the Government, such stories gather momentum—they become the issues that the public read and believe. I am looking to the Government to act to squash such stories in advance, rather than letting matters drift.

We not only have scare stories in the press, but warnings in a leaked report from the Government's own advisers that the contamination of organic crops will be inevitable if GM crops are grown on a commercial scale, leaving organic farmers facing ruin. I suspect that that is not a scare story—it is more likely to be the truth.

All the while, the bioscience companies are angrily protesting the safety of their products. However, the Minister for the Environment has admitted his concern that 12 of the 16 members of the committee advising the Government on GM products have links with the food industry. It is clear that if public concerns over the safety of GM and hormonally modified products are to be allayed, scientific research and advice must be independent and transparent. I am asking the Government to set an example by putting their own house in order first. Will they take the lead by pressing for the WTO international advisory panels to be staffed by independent scientists, and for their deliberations and research to be made public?

That must surely be the first step towards a proper understanding of the benefits and the dangers from GM and hormonally altered food and towards allaying public concerns that are being stoked up by the tabloids into something verging on panic. We need a public policy framework to ensure that public concerns are met before commercialisation takes place and that, once it has gone ahead, the technology is used responsibly.

We believe that a public policy framework should adopt a precautionary approach—I make that point to the hon. Member for Northampton, North—and that lack of scientific evidence to quantify risks should not be a reason for permitting the release of a GM product. The reverse should apply.

Central to the framework should be a five-year moratorium on the commercial growing of GM crops. We must allow time for current Government-funded research projects on the long-term environmental and health effects of commercial growing to be completed. How else can there be a full and informed debate on the issues, addressing public concerns?

Consumers must be given a clear choice about the purchase of GM products. Labelling regulations must be straightforward, to ensure that any GM ingredient is clearly identified. To prevent abuse, it should be mandatory to segregate GM crops at source. To give the regulations teeth, there should be a statutory legal liability, without time limit, on producers of GM products, for any adverse health or environmental effects.

The motion is concerned not only with the WTO ruling that the EU ban on hormonally modified beef must end today and with the need to manage and monitor GM products to restore consumer confidence. It goes to the heart of the matter—the competing interests of the WTO and the agencies concerned with international biodiversity agreements. That is a competition that the WTO invariably wins.

The WTO is one of the most effective and best-developed of all agencies involved in international relations. It has had major success in breaking down international trade barriers, but in pursuit of its purist trade liberalisation objectives, it is able, by the legal power of its rules, to subordinate the biodiversity protocols developed by the other agencies. In short, the power of the WTO rules gives open season to multinational companies whose commercial interests far outweigh any concerns for the environment or for the communities in which they operate.

It would be naive to presume that the bioscience giants are acting as global philanthropists. Their prime concern is, understandably, to maximise the dividends returned to their shareholders. Having invested billions of dollars in biotechnological research and development, their priority is to develop markets for their products in the developing as well as the industrial world.

It is in the poorer countries, where statutory controls are less well-defined and often—let us face it—less robustly enforced, that the risks are greatest. According to some projections, within three years, more GM crops will be planted in the southern than the northern hemisphere—crops that will still be banned in the United Kingdom.

Only this week, Christian Aid published its study on genetic engineering and farming. The report, "Selling Suicide", makes chilling reading. It argues that introducing GM crops to the world's poorest countries could lead to famine rather than feeding the 800 million people who go hungry every day.

Currently, 80 per cent. of crops in developing countries are from saved seed, but the 10 firms that control 85 per cent. of the agrochemical industry worldwide have already taken out patents for seeds with terminator genes in 77 countries and are busily applying for patents for naturally occurring indigenous species. As a result, it will be illegal for subsistence farmers to save seeds from traditional varieties, in the time-honoured practice. They will be forced instead to buy suicide seeds with terminator genes and then buy and buy again year after year.

Christian Aid has raised the spectre that

GM crops are creating classic preconditions for hunger and famine. A food supply based on too few varieties of patented crops is the worst option for food security". By contrast, research in India shows that land reform and simple irrigation can boost crops by up to 50 per cent. That compares with increases of only 10 per cent. from GM crops.

It is clear that while the WTO rules concentrate only on the liberalisation of trade, to the exclusion of concerns for biodiversity and the environment, the commercial interests of the bioscience multinationals will hold sway. The WTO must be reformed to accommodate and recognise biodiversity protocols, multinational environmental agreements and an understanding of genetically modified organisms. The Government have the opportunity through the European Union to argue for reform when the WTO millennium round of negotiations starts in the autumn. I hope that the Minister will give the House an assurance that the Government intend to grasp that opportunity.

The motion before the House covers a wide range of issues related to trading policy between the United States of America and Europe over GM and hormonally modified foods. I have tried to set out the key concerns not only of the House but of the public at large. I hope that the Minister will tell us whether the Government will take a lead in resolving the beef ban crisis and press for reforms in the EU to shake officials out of their apathy; what the Government's policy is on GM foods and crop production; and whether they accept the need for a five-year moratorium on commercial growing. What are the Government's objectives for the millennium round? Do they include reform of the WTO as I have set out?

For too long, the Government have listened to the slick voices of commercial interests. It is time that they listened to the voice of the public and the growing concerns of the international community. It is time that they showed some leadership.

1.42 pm

The Minister for Energy and Industry (Mr. John Battle)

I beg to move, To leave out from "House" to the end of the Question, and to add instead thereof: 'recognises the importance of open markets between the EU and the US, notes that in general the trade relationship is a good one; acknowledges the work being undertaken by the Government in seeking a solution to the banana disputes in a way that is World Trade Organisation compatible and is helpful to British industry and to those countries economically dependent on exports of bananas; welcomes the Government's commitment to find a solution to issues concerning US food exports that is good for the consumer, respects scientific research and avoids protectionism; welcomes the Government's commitment to consider sustainable development issues in its approach to trade issues as well as the interest of developing countries; and endorses the Government's support for comprehensive trade negotiations to be launched at the World Trade Organisation Ministerial meeting in Seattle in late 1999.'.

I know that it is not fashionable to read out the detail of a Government amendment to make sure that people are clear about what it says, but in the light of the speech by the hon. Member for Eastleigh (Mr. Chidgey), I am tempted to do so and to urge him to vote for it. It gives him some of the assurances that he seeks.

We recognise the importance of open markets between the EU and the US". I would have thought that Liberals were in favour of open markets. We also note that in general—I will spell out how—our trade relationship with the US is successful and good. We have worked to find a way through the banana dispute, to which the hon. Gentleman referred, in a way that was helpful to British industry and to those countries economically dependent on exports of bananas".

The amendment also expresses our

commitment to find a solution to issues concerning US food exports that is good for the consumer, respects scientific research and avoids protectionism". We also take into account sustainable development, including biodiversity, in our approach to trade issues, as well as the interest of developing countries, as my colleagues throughout Government Departments have demonstrated. What is more, we certainly intend to grasp the opportunity late in the year to support comprehensive trade negotiations to be launched at the World Trade Organisation ministerial meeting in Seattle.

Mr. Chidgey

I make this point in all seriousness. The Minister will have heard my comment about concerns over the recognition of biodiversity protocols within the WTO rulings. Will he give a specific assurance that the Government intend to embrace that and press for recognition?

Mr. Battle

We are pressing for the inclusion of environmental concerns on the agenda. As I make progress I shall state in detail how.

I found some parts of the hon. Gentleman's speech uncharacteristic of him. He used extravagant, headline-chasing language which was not all that helpful. My hon. Friend the Member for Workington (Mr. Campbell-Savours), who is not in the Chamber now, referred to it. It is not helpful to talk of trade wars going nuclear. The hon. Gentleman said that that was a metaphor, but I class it as extreme hyperbole with a myopic focus.

The hon. Gentleman spoke of GMOs, but they are not a trade issue with America.

Mr. Chidgey

They will be.

Mr. Battle

The hon. Gentleman says that they will be, but I hope that he is not trying to talk up a problem. We believe that we should try to resolve disputes patiently and build an international trading arrangement that enables growth while respecting people and the environment. It is not necessarily what has been called by Lester Thuron a zero-sum game, and it ought not to be.

I accept that a few trade disputes exist; they centre on agriculture and food matters. By and large over the past 200 years, disagreements between Europe and the United States of America have been the exceptions to the rule. Since the 18th century, there have been only a handful of intense disputes, and that includes the Boston tea party. Creating the impression that there is a trade war does not conform to the facts.

I shall give the House some figures, beginning with the EU's main exports to the US. Road vehicle exports in that direction total about 16.4 billion euros, with no disputes. Power-generating equipment exports are worth 9.5 billion euros, with no disputes. Specialist machinery exports are worth 8.9 billion euros, with no disputes. Other categories include electrical machinery, general machinery and organic chemicals, none of which has aroused a dispute.

European Union imports from the US include vehicles, office machines, and electrical and power-generating machinery, and are worth many billions of euros. However, EU agriculture exports to the US amount to only 2.8 billion euros, while EU imports from the US total 4.3 billion euros. Those figures show that trade in agriculture amounts to only a tiny fragment of the overall trade. By and large, there are no disputes in EU-US trade in the vast majority of goods. It is worth getting the matter in perspective.

Mr. James Gray (North Wiltshire)

I want to pick up the Minister on a detail, about which I am sure that he would not want to mislead the House. He said that trade in electronic instruments was not the subject of dispute, but he will know that there is a trade ban on the import from America of electrothermic tea and coffee makers. Perhaps he would like to correct what he said.

Mr. Battle

I accept that there is a knock-on effect from the dispute about agriculture but, by and large, trade between the EU and America has gone along peacefully, calmly and without problems for generations. Although real and serious disputes exist, we should keep them in proportion.

The vast majority of trade and investment between the EU and the US takes place without difficulty. The relatively few disagreements that exist, although important, should not be allowed to discolour the nature of the relationship.

Mr. A. J. Beith (Berwick-upon-Tweed)

That may be so, but I hope that the Minister will recognise that the US seems to have an uncanny knack of lighting on products that are the staple industries of small communities. The cashmere industry in the borders is an obvious example, but there are others. It is almost as if the US has rather better intelligence about which communities are most vulnerable to import tariffs than about the location of Chinese embassies.

Mr. Battle

Some of the headlines that have appeared—for example, suggesting that the US plans to "punish" British companies—are not accurate, as the secondary list of trade goods will not be available for a few days. I shall return to that matter in greater detail later, and suggest how it can be tackled, but there are bound to be occasional frictions in what is a substantial and complex trade relationship. I do not underestimate the problem, but the figures speak for themselves.

The EU and the US are the two biggest economies in the world, accounting for 54 per cent. of world income. Even excluding trade within the European Union, together they account for 38 per cent. of world exports, and 39 per cent. of world imports. In 1997, EU goods exports to the US were worth $160 billion, while US goods exports to the EU came to $156 billion. The US is easily the EU's most important external export market, accounting for about 20 per cent. of exports.

The trade figures are impressive, and the investment figures are too. In 1997, direct investment flows from the US to the EU amounted to about $24 billion. The US is the most important source of external investment into the EU, accounting for more than 50 per cent. of the total. Again in 1997, EU investment flows to the US came to $42 billion, with the US accounting for more than 40 per cent. of total EU direct investment overseas. I give those figures to demonstrate the perspective of our trade relationship, to keep that substantial relationship in focus and to show that the present disputes are far from totally undermining the relationship.

Bilateral relationships are not the only reason why the European Union and the United States of America matter in the world economy. They are the twin pillars of the world trade system, and they are co-operating to advance shared interests across the whole system. We must bear in mind the joint impact of the two trading partners on every part of the world. For example, we should consider the effect of the banana dispute on smaller nations—the African, Caribbean and Pacific countries that rely so much on the export of bananas to the EU.

I appreciate that other hon. Members have worked in other capacities during their lives. I have spent some of mine working on EU policies for third-world countries under the agreements of the Lomé convention, and I know how difficult it is to carry through detailed negotiations to make sure that people receive justice in a complex world. The EU and the USA have had several formal opportunities to do so, not least through the twice-yearly summits, including the last on 18 December 1998. The next will be on 21 June, giving the opportunity for dialogue that can minimise trade frictions and build co-operation and confidence. There is scope to enhance that dialogue further for better management of disputes.

Mr. Eric Martlew (Carlisle)

The motion refers to the United States of America, but there is a problem with another north American country. Canada intends to put excessive duties on various products in the near future, and one of them will be the sweet biscuits manufactured in my constituency. There is no justification for the imposition of such duties. Will my hon. Friend take the matter up urgently with the Canadian Government in the hope of achieving a settlement soon? It would be wrong if my constituents and Cans of Carlisle, a factory with a good reputation, were to suffer because of a trade war in which they have no involvement.

Mr. Battle

I agree with my hon. Friend. As the hon. Member for Eastleigh said, the impact on our constituencies is vital and it is important to resolve these disputes. We hold summits and conversations with Canada around the same sort of issues as those we discuss with the USA relating to the WTO. We shall do our best to ensure that we develop conversations in order to avoid disputes that might discolour our wider relationship at a crucial time for world trade.

Ms Joan Walley (Stoke-on-Trent, North)

May I draw my hon. Friend's attention to the ceramics industry? Particularly high tariffs are applied to catering china exported to north America. During his conversations, will he consider those extra tariffs and whether protectionism is being applied?

Mr. Battle

My hon. Friend makes an important point, although I did not appreciate that ceramics were on the list of items hit by the current disputes. I am more than happy to ask questions about the tariffs. Not all tariff barriers have fallen, and our purpose is to have the WTO develop a system to reduce tariff barriers to ensure fair trade everywhere. I shall be happy to take on board my hon. Friend's remarks and to raise the issue on her behalf.

The transatlantic economic partnership signed last May at the EU-USA summit in London enshrined an agreement for the two sides to develop an early warning system for potential disputes over agriculture, the environment, food safety and biotechnology, which have been sensitive issues recently. That agreement is vital if the EU and the USA are to avoid friction in the world trade arena, given the impact of their relationship on everyone else in the world economy.

Building open markets remains as vital and important today as it was when GATT was first founded. Of course, it is more than evident that protectionist pressures are growing. As the downturn in the global economy continues, it leads to such pressures, as we all know. That increases the urgency of the need to look for sensible ways in which to boost genuine, sustainable economic growth: that, not retreating behind protectionist barriers, is the key to the future.

We should at least thank the hon. Member for Eastleigh for raising this subject for debate. It is a timely opportunity to say something about the need to support the comprehensive round of trade negotiations that we hope will be launched at the WTO ministerial conference in Seattle at the end of the year—I think that it will take place between 30 November and the early days of December.

Yes, we will positively support a comprehensive round at those talks. Seattle will be the third ministerial conference, so let us consider how we have got where we are. The first meeting in Singapore, in December 1996, put in place a work programme on new issues, such as investment, competition, procurement and trade facilitation. The second meeting in Geneva, in May last year, agreed the process for the preparation for Seattle.

We believe that a comprehensive round will allow all countries, including developing countries, to get an overall package to reflect their broader interests too. It will allow us to get arrangements on to a sound, commonly agreed and stable footing. That must be the objective and our Government will work towards that.

Some people have questioned the wisdom of pushing ahead with opening trade at a time of difficulty in the global economy. Trade was not the cause of the south-east Asian crisis and trade would not provide a complete solution, but it can help the world on the road to recovery, and it can help economic and social development.

Most recently, the Uruguay round brought a significant boost to world trade, to jobs and, therefore, to incomes. One of the key lessons of history is that the protectionist response to the global crisis in the 1930s made matters much worse—it led to a protectionist backlash. There are some signs of growing pressures now, but it is essential that we keep pushing forward the momentum for opening markets and developing open trade policies throughout the globe. That is why the United Kingdom and the European Union have pledged to resist protectionism and, contrary to what the hon. Member for Eastleigh might suggest, to secure that new round of multilateral trade negotiations.

A huge number of subjects are of particular importance to the UK in those negotiations: the need for further tariff reductions, to which my hon. Friend the Member for Carlisle (Mr. Martlew) referred; reducing barriers to trade—for example, unnecessary blockages, such as technical regulations; opening up Government procurement markets in third countries; simplifying import and export procedures; seeking substantial reductions in support and protection for agriculture; deepening and broadening the opening of trading services; establishing an open rules-based framework for international investment; clarifying the interaction between environmental and trade policies; and tackling trade and competition issues. That is a huge agenda and we are keen to press ahead with it.

At the same time, we are also conscious that we are trying to build. I point out to the Liberal Democrats at this time of new politics, when we are working towards a consensus, that trying to achieve that consensus around the table of the WTO is not so easy. Not all the members support a comprehensive round, as I am sure the hon. Member for Eastleigh acknowledges. Many more want to focus on particular market access, rather than the new overall rules. Others stress the need to stick only to those negotiations to which we are already committed—that is, in agriculture and services—and will not shift from there.

Since we have referred to the American position, President Clinton recently signalled support in his state of the union address for a new round. That was a very welcome statement. He said: I issue a call to the nations of the world to join the US in a new round of global negotiations to expand exports of services, of manufactures, and, most of all, farm products. We should assent to that aim to try to build together a round that will open up markets internationally and fairly. It is too early to say what sort of package will emerge from the ministerial conference this year. Discussions in Geneva so far have been developing the agenda to get the context right for detailed negotiations.

It is probably fair to say that the new issues, including the new work on the environment, are likely to be the most difficult in the new round. We accept that. Some developing countries believe that those issues are not yet ready for substantive negotiation. While we need to be realistic about what is achievable in the circumstances, we see value in the inclusion of environmental issues on the agenda. Clearly, there will be much focus on agriculture which, as the hon. Member for Eastleigh said, is important for developing countries, too.

Concerns have been expressed in Geneva about the implementation of existing agreements. Greater and more coherent focus will be needed on technical assistance and capacity building. That is not something only for the WTO; the United Nations conference on trade and development, the International Monetary Fund and the World bank all have parts to play. Decisions in the WTO must be taken by consensus. There is every sign that developing countries will articulate a clear agenda of their interests, including issues relating to implementation, anti-dumping and open markets in, for example, textiles as well as in agriculture. They will not be reduced to being silent observers. The United Kingdom is doing all that it can to encourage their active participation in detailed negotiations.

We are clear that free trade has never meant, and should not mean, a free-for-all. There is a crucial difference. There is plenty of scope for reflecting concerns about health, social questions and the environment, but a system of international rules must have objective reference points. That is precisely why we need to rely on independent scientific justification, which is crucial. My experience has been that people are resistant to independent scientific advice as well. When they get it, if they do not like it, they refuse to believe it. That is part of the problem of perception.

Sustainable development is crucial. Protecting the environment and maintaining an open, non-discriminatory, equitable multilateral trading system are essential to achieving the objective of sustainable development. There are many effective, internationally recognised measures that aim to protect the global environment. Of course, much more remains to be done, but progress has been made in the past 20 years, with several multilateral environmental agreements with which we can work. Opening trade will help to ensure that resources are used more efficiently, and generate the wealth necessary for sustainable development and environmental improvement. It will also enable the spread of new environmental technologies that will help to tackle the pollution problems that we have inherited. Cleaner technologies will provide the jobs and industries of the future globally.

All Governments must consider their trade and environmental policies together. I cover the industry brief in government and I am determined not to see industry set against the environment as if they are irremediably at odds and mutually exclusive for ever. They can be fitted together, and the best companies recognise that, build environmental practice into their business, and see it as beneficial and profitable to have a sustainable agenda. The two policies can fuse together. If we are to deliver sustainable development internationally, we need to build it into trade relations as well.

Governments have a duty to balance the objectives of protecting the environment and upholding an agreed, multilateral trading system, whether we are negotiating in trade or environmental forums. It is for parties to both new and existing agreements to ensure, individually and collectively, that they do not sign up to conflicting, mutually exclusive requirements. That is the challenge.

My hon. Friend the Minister of State, Ministry of Agriculture, Fisheries and Food will deal in more detail with some of the points on agriculture and food raised by the Member for Eastleigh. The European Union ban on hormone-treated beef has been in place for more than 10 years. In 1998, the WTO found that the ban was inconsistent with its rules because it did not follow from a properly conducted risk assessment. The EU was given a period, which, coincidentally, expires today, to comply with the ruling.

A helpful article in this morning's Financial Times stated: US trade officials said yesterday they were determined to exercise their rights in the WTO to retaliate, but were prepared to continue discussing with the EU proposals for a negotiated settlement. I take heart from that. The article also stated that the scale of the possible sanctions was likely to be scaled down and that the measures were unlikely to take effect before early July, leaving another two months in which to seek a settlement of the dispute. It continued: the EU ban to US beef exporters, originally set at $900m, to be cut to between $100m and $300m. That figure could be lowered still further.

In a way, it is fair for the hon. Member for Eastleigh to paint the worst picture and to suggest that there are £1 billion of trade sanctions around the corner. However, we are not yet in that position; negotiations can continue. Furthermore, the US Government have reacted by pointing out that the characterisation of the situation outlined to the European Parliament by the Commission's Vice President, Leon Brittan, was useful and appropriate. I think that that puts matters into context, because some alarmist press comments were made by the Commission, which may explain some of the tone of the current commentary. I should be more interested in trying to work towards a sensible settlement of the dispute.

Mr. Drew

Given my hon. Friend's previous portfolio, can he clarify the Government's position on the ban? Have they carried out an independent scientific investigation into the safety of hormones in beef?

Mr. Battle

The UK was one of the few countries that pressed for labelling to give consumers an option—that would make matters much clearer. I shall respond in detail to my hon. Friend's point later in my speech.

We understand from Washington that there will be an announcement—perhaps tomorrow—formally expressing disappointment that the EU has not complied with the WTO requirement to lift the ban, and stating an intention to exercise the right to retaliate under the WTO. The US will need to apply to the WTO in Geneva for authorisation to retaliate, but it is not clear exactly when it will do so. Canada is likely to take similar action—that relates to a point made earlier by my hon. Friend the Member for Carlisle (Mr. Martlew). The EU will then seek arbitration on the amount of retaliation due, which will delay authorisation until mid-July and may well reduce the overall amount. We shall not see the detailed list of retaliation for about 10 days, but the British position is widely recognised in the United States, as is the fact that we have played a helpful role in the matter. We hope that further negotiations can be undertaken to de-escalate the current problem.

Mr. Chidgey

The Minister has mentioned twice that negotiations are being pursued on retaliation. I press him to tell the House whether the Government's view is that we should seek a solution based on compensation rather than one based on retaliation.

Mr. Battle

That is precisely the position that Sir Leon Brittan took at the Commission; he is negotiating on that basis and I hope that that will prove to be a helpful step in the interim.

The WTO rules require that trade measures put in place to protect human, animal and plant health must have a scientific basis. That brings me to the point made by my hon. Friend the Member for Stroud (Mr. Drew). Governments can and do apply restrictions to protect their consumers, but they must be in line with international standards or justified by a risk assessment when they are more stringent than international standards. Obviously, if those rules were not in place, countries could simply impose restrictions—ostensibly on the grounds of consumer protection—but without any scientific back-up whatever. In reality, they would simply be protecting their own interests.

Miss Anne McIntosh (Vale of York)

Will the Minister tell the House on what basis British beef was rejected from the US in the early 1980s, before the BSE crisis?

Mr. Battle

I am tempted to say that if I were allowed another half hour to speak, I would go through the history of the previous Conservative Administration on BSE, but I think that I should be ruled out of order. I gently point out to the hon. Lady that, when we came into Government, I was not allowed to go through all the details—other than what was in the press and in Hansard—of what was done by the previous Administration. However, I should love to spend my life in the Library digging through those murky papers to find out what happened. To the hon. Lady, I say simply that in the case of beef hormones, as in other cases, we must recognise the importance of sticking to scientific principles, as the hon. Member for Eastleigh pointed out.

Protection of the consumer, and the health and safety of people and the environment are of paramount concern to the Government—they are our starting point. We have always opposed the EU ban on beef hormones on the grounds that it is not justified by scientific analysis, but if genuinely fresh scientific evidence—not simply recycling of previous claims—were to emerge, we would reconsider the case for the ban. As the EU continues to carry out a new series of risk assessments, we should continue to engage in serious dialogue with the United States and Canada. We are encouraging the US to discuss compensation, as an alternative to retaliation, and labelling options, in which we led the way.

Mr. Gray

On the question of scientific evidence on the safety of hormones, how can Minister argue that no precautionary principle is in play and that we must allow the stuff because it appears to be all right, when the Minister of State, Ministry of Agriculture, Fisheries and Food has banned beef on the bone, which has been shown to pose a one in 2 billion risk of any form of infection? Beef hormones are a heck of a lot more dangerous than beef on the bone.

Mr. Battle

The hon. Gentleman says that, but he should check the evidence. Let me read to him the US Government's reaction to recent developments, in which they challenge the evidence that has emerged in the past few days on the ground that it is merely a recycling of previous claims. It states: From what our scientists have seen of DGXXIV's summary report so far, the summary does not have any new scientific data on which to base its claims that the hormones in question may be harmful. In fact, the data cited in the summary seems to be the same as that already reviewed by numerous scientists, including the Joint Experts Committee on Food Additives (JECS), two previous groups of scientists commissioned by the EU and five scientific experts who provided their advice to the WTO beef hormones panels.

We should occasionally remember that there are damn good scientists in the United States of America and that we cannot accuse the US of scientific indifference. There are going to be arguments about the science, so we have to do our best to obtain independent evidence. Notwithstanding all that, we are one of the few countries calling for labelling. Supermarkets are pulling GMOs and other products off their shelves in response to consumer pressure, rather than to detailed scientific evidence; therefore, our argument is that, if products containing beef hormones were labelled, consumers would be able make their own judgment.

Mr. Gray

American scientists would say that, wouldn't they? How can the Minister so lightly dismiss the many scientists who say that there is no possible link between beef on the bone and new-variant CJD? How can the Government ban beef on the bone and simultaneously permit the import of hormone-treated beef? That is the contrast I want the Minister to address.

Mr. Battle

The hon. Gentleman implies that, because they are American, the scientists must be biased and willing to jeopardise their professional and scientific integrity, but I shall not respond in kind. I know that, when he winds up the debate, my hon. Friend the Minister of State, Ministry of Agriculture, Fisheries and Food will respond in detail on the question of beef on the bone.

Our primary duty in respect of GMOs is to protect people and the environment, which is why, at EU and national level, we have a comprehensive framework in place to regulate and advise on biotechnology and to assess new products rigorously before they are approved for use. No product is allowed on to the market unless and until it goes through safety assessments. Those stringent assessments afford an extremely high level of consumer protection, so it would not be right for the UK or the EU to impose a unilateral ban on products that pass through those processes. However, if fresh scientific evidence on the safety of any GM product were to come to light, of course we would consider whether a ban was justified.

Dr. Peter Brand (Isle of Wight)

I am interested in the Minister's reiteration of the need for fresh scientific evidence. We have many committees of scientists reviewing the scientific evidence available, but will he or his colleague, the Minister of State, Ministry of Agriculture, Fisheries and Food, tell the House what work we are initiating to produce fresh evidence? So far, most of the evidence comes from manufacturers of somatotropins, who clearly have an interest in maintaining the existing verdict in favour of their product.

Mr. Battle

It is not fair to say that all or even most of the scientific evidence comes from the companies. For some time, I have had the privilege of being responsible for science, which covers work on the environment and work within the EU such as the framework programme, whereby scientists in universities and institutions throughout Europe, including the UK, develop expertise in biotechnology. I know that the work is not necessarily funded by biotechnology companies or any of the other companies mentioned by the hon. Member for Eastleigh. All the scientists carry out their work with integrity and I respect that.

My reason for using the word "fresh" is that, often, reports of a few comments or summaries by a researcher appear somewhat prematurely, before peer review and before proper publication in the usual form of authorised scientific papers. That prematurely delivered information is often recycled information which has been gleaned from other people's papers and re-presented—a practice which, in the days when I did research, would not have been accepted as research, because it involved no originality. We are looking for originality—that is what I mean by "fresh". We encourage scientists to explore developments in biotechnology and ensure that they are safe. My hon. Friend the Minister of State, Ministry of Agriculture, Fisheries and Food can spell out, in detail, the work that we have initiated. In addition, the House should recognise that, through the science budget, we fund some of that work.

I emphasise that, although the United States has expressed some concern about the European regulatory system because of the time it can take to grant approval for a new product, there is no trade dispute in respect of GMOs between the United States and us. The US also recognises that consumers need to be able to make an informed choice, which is why we label products containing GM ingredients.

Let me end on the general significance of trade disputes in the EU-US trade relationship. I know that the hon. Member for Eastleigh wanted to get the expression "American food imperialism" on the Order Paper, but encountered problems in the Table Office.

Mr. Chidgey

Nonsence.

Mr. Battle

I would suggest that, economically speaking, the term "mercantilism" might apply better to the problems that he has raised, but I, too, defer to the Table Office's judgment on the use of language. However, we must remember that, if we constantly heighten the language, we make diplomacy harder. We should look for common points of contact on which we can build a world trade system that enables the vast majority of the substantial trade and investment flows to proceed fairly between us.

Disputes are rare and, without wanting to minimise their individual importance, I have to say that there is a danger that if we over-emphasise them, we risk discolouring the overall relationship and jeopardising the future. It is possible for trading partners to resolve differences if there is a willingness to work patiently towards practical solutions. It is all the more important to do that when the two trading partners are the European Union and the United States, not only because of the massive and dynamic bilateral trading relationship that exists between us, but because of the impact of that relationship on the development of the world trading system as a whole.

We have a good trading relationship with the United States of America—one that has existed since the 18th century. We should carefully, sensibly and patiently work on developing that relationship as a dynamic and fair economic model for the whole world in the 21st century. I believe that that can be achieved, if we have the will to do so.

2.19 pm

Mr. Christopher Chope (Christchurch)

We welcome the opportunity to debate United Kingdom trade policy and the World Trade Organisation, and we agree with many of the constructive sentiments expressed by the Minister. We deplore the woolly wording of the Liberal Democrat motion, and some of the scaremongering and irresponsible statements by the hon. Member for Eastleigh (Mr. Chidgey), which disclosed some of the muddled thinking that we have come to expect of the Liberal Democrats. I have read the motion on the Order Paper for the second half of this afternoon, and if this is supposed to be an example of how the Liberal Democrats hold the Executive to account, it carries about as much punch as a bowl of overcooked noodles.

When the Minister said that the original wording of the motion made reference to American food imperialism, the hon. Member for Eastleigh said that he thought that nonsense. I was in the House this time last week, when the Leader of the House announced that this afternoon there was to be a debate entitled 'American Food Imperialism and European Trade Policy'."—[Official Report, 6 May 1999; Vol. 330, c. 1089.] I presume that that title was not invented by the Leader of the House, but emanated from the Liberal Democrats.

If the references to American food imperialism were meant to be the soundbite that would motivate plenty of people to vote for the Liberal Democrats in my constituency last Thursday, which was polling day, it manifestly failed, because the Conservatives were returned in 36 of the 44 district council seats, gaining no fewer than 13 seats from the Liberal Democrats and reducing their number in my constituency to a mere five.

Conservative Members recognise and support the importance of the World Trade Organisation as a body committed to promoting global free trade and the reduction of trade barriers. We, as a global trading nation, have more to lose from protectionism and trade barriers than does any other member of the European Union. I think it fair to say that some of our European partners are instinctively more protectionist than we are, and given attitudes to British beef exports, too many European Union countries have shown a willingness to appease protectionist lobby groups rather than defend the virtues of open markets, sound science and the leadership of the World Trade Organisation.

We last debated this subject on 22 March 1999, before the World Trade Organisation's April ruling on the banana regime. During that debate, I and several other hon. Members asked the Minister a series of questions about what would happen if the World Trade Organisation endorsed the United States' trade sanctions against the EU for failure to comply with the WTO rulings on bananas. We did not receive any answers, and we now realise why. It is obvious from what has happened since that the Government had failed to ensure that the European Union drew up prudent contingency plans. The consequence is that the legally authorised WTO sanctions, amounting to $131 million a year, are now in place, and several United Kingdom niche businesses are suffering very seriously as a result.

What action are the Government taking? What is the European Union doing? If ever there was an issue that demanded immediate answers from the Government, it would be this one. It is a pity that the Liberal Democrats did not even mention that in their long-winded motion.

On 29 April 1999, I tabled a question to the Secretary of State for Trade and Industry, asking on what date he expected the European Union to introduce a banana regime that was in compliance with the ruling of the World Trade Organisation. By 11 May, following a holding reply, I received the answer. It is a matter of great regret to Opposition Members that, on an issue of such sensitivity, it took the Secretary of State the best part of a fortnight to reply to such a question. The reply, from the Minister for Trade, said: It is unclear how quickly the European Union can amend the banana regime to bring it into compliance with the ruling of the World Trade Organisation. The Council has asked the Commission to provide proposals by the end of May. However, the forthcoming elections to the European Parliament are likely to delay their approval of a new regime until at least September. In the meantime, we are pressing the Commission to find an interim arrangement which could be agreed quickly and which would displace US retaliation against EU industries."—[Official Report, 11 May 1999; Vol. 331, c. 84-5.]

What a farce; what a state of affairs. Anyone would think from that reply that the World Trade Organisation ruling or the date of the European elections came as bolts from the blue. All along, the European Union approach has been one of indecision, prevarication and delay—of hoping that the problem would go away. It did not go away, and when the European Union was confronted with the decision and the authorisation of the World Trade Organisation, it gave all the appearance of having made no arrangements to deal with it. It is now claiming the European elections, the chaos in the European Commission and various other factors as explanations for not addressing the issue with greater urgency.

When the Conservatives were in government and the Minister of State, Ministry of Agriculture, Fisheries and Food, the hon. Member for Birmingham, Perry Barr (Mr. Rooker), was an Opposition Member, Secretaries of State were several times found by the courts to be acting unlawfully. The hon. Gentleman was very quick to say how appalling that was, and to say that the Government should immediately comply with those rulings. That is a perfectly legitimate line to take; compliance with the rule of law is fundamental to any regime that commands respect.

The WTO has made its ruling and the European Union is saying, "We shall comply, but we are not quite sure when." In the meantime, sanctions against innocent firms in the European Union are biting. This is not an academic debating point. As we speak, the sanctions are costing British jobs and successful British businesses. So far, the Government have given all the appearance of being pretty indifferent to the plight of those businesses.

On 11 May 1999 the Minister for Trade gave a written answer to my question, tabled on 29 April 1999, containing his estimate of the number of jobs put at risk by the trade sanctions of the United States authorised by the World Trade Organisation: In terms of the historical levels of exports to the US in each sector, it is not possible to say what the overall impact on British jobs might be. Much depends on how long the retaliatory measures remain in place, the ability of affected businesses to find alternative customers for their products, the extent to which orders have been brought forward before these measures took effect and local market conditions."—[Official Report, 11 May 1999; Vol. 331, c. 85.] That may well be correct, but it ignores the fact that, as the Minister knows, many niche firms very much depend on their export trade to the United States, and they have lost business which they cannot replace in other markets.

One such firm, to which I drew attention in oral questions last week, is called Beamglow. It had invested heavily in the US market—about £2.5 million. It is quite a small business, employing only 100 people. About 25 per cent. of its turnover is with the United States, and it has lost all that business as a result of the sanctions. The firm has communicated with Ministers, but has had no satisfactory response.

When I raised the matter with the Secretary of State in oral questions last week, he made it seem as though it was everyone else's problem but his. He said that the real solution is to resolve the trade disputes. Fine. The Government are committed to achieving that long-term solution to the problems. Fine. The solution to the problems that companies such as Beamglow face lies in the Government using our best efforts to ensure that the trade disputes with the United States are resolved fine— and that free trade and commerce are able to flourish."—[Official Report, 6 May 1999; Vol. 330, c. 1072-3.] But what will happen in the meantime? By the time the dispute is resolved—the Minister for Trade estimates that that will be no earlier than September, and some people say that it might drag on beyond the turn of the year—Beamglow will have been obliged to lay off a very significant number of its employees.

Beamglow is not the only firm affected. Carrs of Carlisle, a much larger firm, and Woods of Windsor, a niche business with which the Minister for Energy and Industry will be familiar, are suffering very seriously as a result of the sanctions. Those firms are asking, "What will the Government do to help us? We are the innocent victims of the European Union's failure to respond positively and quickly to a ruling of the World Trade Organisation."

Mr. Gray

Has my hon. Friend noticed that despite the Government's general lack of concern about the industries that he describes, they have been extremely concerned about one particular area? In the politically sensitive and delicate area of the Scottish borders in the run-up to the parliamentary elections last week, the Government have gone out of their way to help the cashmere industry. Would not Beamglow and other firms wish that they were in that area?

Talking of lack of concern, has my hon. Friend noticed that there are now only two hon. Members on the Liberal Democrat Benches? Although this is the most crucial debate in their parliamentary month, only two of them have stayed to listen to my hon. Friend.

Mr. Chope

I am grateful to my hon. Friend for his intervention.

We as much as anyone supported the Government initiative to help the cashmere industry. The threat of the sanctions being applied prior to authorisation by the World Trade Organisation put the cashmere industry in particular difficulty. The Government offered up to £40 million in guarantee payments.

Since the ruling went against the European Union, however, the Government have done nothing. No doubt through the diplomacy of the Prime Minister in conversation with the President of the United States, the Government managed to exempt cashmere from the list of products that would be the subject of 100 per cent. tariff—[interruption.] I give way to the Minister.

Mr. Rooker

I asked the hon. Gentleman why he kept talking about cashmere, when he knew that it was not on the list.

Mr. Chope

I am sorry that the Minister does not understand the point made by my hon. Friend the Member for North Wiltshire (Mr. Gray). Cashmere was originally on the list, but it has now been taken off. Before the issue was resolved in favour of the cashmere industry, the Government had agreed to give up to £40 million in assistance. They are not prepared to put a similar sum or any compensation regime in place for equally innocent and deserving victims of the dispute.

Mr. Battle

Two things—first, the cashmere industry is not located only in Scotland. I come from Yorkshire, and the industry exists also in Bradford, a city next to mine. Secondly, there was a particular difficulty with cashmere. If you knew anything about the textile industry, you would know when the buying season was in America—

Mr. Deputy Speaker (Mr. Michael Lord)

Order. The hon. Gentleman must use the correct parliamentary language.

Mr. Battle

I apologise, Mr. Deputy Speaker. If the hon. Member for Christchurch (Mr. Chope) knew anything about the textile industry, he would know when the buying season was. That was the reason for the extreme difficulty at the time. We worked to resolve the dispute, to get cashmere textiles and other items off the list, and to reach a sensible solution within the EU. The hon. Gentleman's comments come rich from him. Thousands of jobs in manufacturing went in my constituency. The answer that I got when I was in opposition was that that was due to world recession and I should not worry about it.

Mr. Chope

I am gobsmacked by the Minister's attitude. I would have hoped for considerably more sympathy for the innocent victims of a trade dispute in which the European Union was found guilty by the World Trade Organisation. In his speech the Minister spoke about the desirability of introducing a compensation regime in favour of the United States. Why are not the Government prepared to introduce a compensation regime for British firms that are the innocent victims of the European Union's failure to deal with the issue?

Mrs. Caroline Spelman (Meriden)

The mock anger displayed by the Minister will cause deep frustration among those in west midlands manufacturing who have difficulty understanding why other regions of the United Kingdom should receive easement and compensation, and why firms manufacturing such important products as bath preparations, with a total export value of £7.2 million, should still be on the list of products that are not relieved. Midland Cosmetics in the west midlands has £2 million of orders on hold because of the Government's failure to provide the same sort of compensation as they have provided in other parts of the country.

Mr. Chope

I am grateful to my hon. Friend for that intervention. If the Minister wishes to intervene to answer the point, I shall give way to him.

Mr. Battle

We have been trying to get the list down and to ensure that companies are not jeopardised by sanctions. That is the whole point. To avoid further sanctions, we are encouraging negotiations. Of course there will be financial penalties, but we do not want more companies to pay them. Is the hon. Lady suggesting that the Government should buy and store all the products of the companies affected? What sensible proposals does she have, other than direct grant and Government intervention? In the case of cashmere, it was not grant; it was a loan system to back firms up during the short-term buying season.

Mr. Chope

I shall allow my hon. Friend the Member for Meriden (Mrs. Spelman) to make her own speech. In response to the challenge from the Minister, I would say that if the Government of which he is a senior member had anticipated the ruling of the World Trade Organisation, they would have had a proper contingency plan in place, which would have been a compliant regime to take effect immediately.

If the Government and the EU had done that, no penalties would have been imposed on firms such as the one referred to by my hon. Friend. Those firms are now suffering as a result of the 100 per cent. tariff barrier. They are losing business and some of them will be threatened with bankruptcy. In any event, many will have to shed a large number of jobs.

The Government should have anticipated the situation, and even now they should be getting on and ensuring that a compliant regime is introduced. [Interruption.] Instead, we get much delayed ministerial replies to our questions. The Government shrug their shoulders and say, "There is nothing we can do. We are waiting for the European parliamentary elections."

Mr. Battle

We are doing things—

Mr. Deputy Speaker

Order. The Minister must not keep intervening from a sedentary position.

Mr. John Hayes (South Holland and The Deepings)

rose—

Mr. Chope

I give way to my hon. Friend.

Mr. Hayes

Does my hon. Friend agree that it does the Government no good to display such a lack of contrition and humility? The Minister sits there barking and shouting in response to a legitimate claim on the part of Conservative Members in the interests of hard-pressed companies. That tells the whole story about the Government' s attitude to those industries, those businesses and the people who work in them. I invite my hon. Friend to suggest to the Minister that he calm himself a little, and display a little more humility and compassion about the damage that is being done to those hard-pressed companies.

Mr. Chope

I am grateful to my hon. Friend. He gives wise advice to the Government. They get hysterical and say that they are doing all they can, when it is apparent that they are not. If they were doing everything that they could, they would have sorted out the problem already. They are relaxed about the problem and say that it may go on beyond September till the end of the year.

The Government were quick to help the cashmere industry and rather slow to help firms such as those that we have mentioned. We suspect that the Government are rather indifferent because a number of those firms are situated in the constituencies of Conservative Members of Parliament—for example, Woods of Windsor, and Beamglow, which is in the constituency of my right hon. Friend the Member for Huntingdon (Mr. Major). That suspicion, which several of my right hon. and hon. Friends share, as do some of the people who work for such firms, is given credence by the extraordinary attitude of the Minister, who seems totally unconcerned about the plight of those businesses.

Mr. Battle

Name a Conservative Member of Parliament in Bradford.

Mr. Chope

I cannot name a Conservative Member of Parliament in Bradford, but I can name an increasing number of prominent Conservative councillors there.

The Minister needs to take the issue much more seriously than he has hitherto. I hope that he will introduce a compensation package for firms that are the innocent victims of the banana dispute. As members of the EU, we obviously take our share of the responsibility, but the EU' s failure to comply with WTO rules has meant that people are losing their jobs and are suffering financially in those businesses. All that is happening is that the Government are shrugging their shoulders, which is not good enough.

Mr. Rooker

We have been discussing bananas for 20 minutes.

Mr. Chope

I do not know how long we have been discussing that issue, but I know that we are discussing real jobs and real businesses—often family businesses that have been built up over generations and have entered and successfully competed in a very difficult United States market. They are finding that all that investment and effort are being completely destroyed as a result of the Government's behaviour and the failure of the Government and the EU to address this issue sensibly. As far as I am concerned, this subject is worthy of an Adjournment debate in its own right.

The good news is that we are making progress in some other areas. During our debate on 22 March, I raised the issue of hushkits and the growing dispute over them. The steam seems to have been taken out of it as a result of sensible co-operation and discussion between the EU and the United States. However, Emma Bonino recently said that, whatever the scientific position, there is no question of the beef ban ever being lifted—which is provocative.

Mr. Battle

Who is she?

Mr. Chope

Emma Bonino is one of the Commissioners—a temporary Commissioner who is about to lose her job, I think, although we are not sure about that. She said on behalf of the EU that there is no question of the beef ban ever being lifted. That sort of comment causes a number of people to think that provoking the United States into a trade war is on the agenda of some members of the EU, to assist them in their own protectionist objectives. I hope that that is not correct.

There is talk of temporary solutions. The report in the Financial Times, to which the Minister referred, gives us hope that the hormone-treated beef issue will not now result in any direct trade sanctions, at least until July, and we hope that it will be resolved before then.

Mr. Rooker

Now that the hon. Gentleman has got on to the issue of hormone-treated beef, I invite him to confirm that the current position of the Conservative party is exactly the same as that which it took in government. It has changed its policy on genetic modification since then. We have continued the policy on hormone-treated beef because it is based on the science. I should like confirmation that the position remains the same as far as he is concerned.

Mr. Chope

As the Minister knows, I was not a member of the previous Government; I was not even a Member of the House, so I will not get drawn into a discussion about that. I would support what Ministers have been saying about the importance of sound science, which is absolutely fundamental. If we are not committed to supporting sound science, any country in the world will be able to say, "We don't want your products because we've got some people who say that they do not really like them." That would be quite at odds with any principle of free trade, which Conservative Members promote very strongly.

Mr. Rooker

I do not want to labour the point, but I recall that the hon. Gentleman was a member of the Government until 1992. The ban on hormone-treated beef has been in place for 10 years and he was a member of the Government when that ban was introduced on behalf of the EU. I am asking my question simply to avoid any doubt and because of the Conservative party's change of policy on genetic modification.

We take a different view from the rest of the EU on hormone-treated beef, but we have operated the policy as good members of the EU. We want to operate on the basis of sound science, and I invite the hon. Gentleman to say whether the Conservative party's position remains the same as when it was in government—that is all.

Mr. Chope

If there was a change in Conservative party policy, the Minister would soon hear about it. I have set out the position as I understand it to be and I have nothing to add on that particular subject.

We are pleased that it looks as though some of the heat has been taken out of the hormone-treated beef issue. However, if we find in July that nothing much has been done to resolve the scientific issues and the United States has in the meantime drawn up a list of targeted firms—as the Minister has said, that might be announced in the next 10 days—I hope that the Government will not have allowed the EU to be as slack in preparing a contingency plan as it has been found to have been in respect of bananas. I condemn the EU and I condemn the Government for the part that they must have played or not have played in this; but let us learn something from the experience—if we are given a couple of months, we should draw up some sensible contingency plans.

Does the Minister think that the approach taken by the Government to hormone-treated beef—standing out from other members of the EU—will result in a differential regime for the imposition of sanctions? The Netherlands and Denmark publicly opposed the EU banana regime and the United States said that it would not introduce sanctions against them for what was effectively an EU decision. Have the Government had any intimation from the United States on whether that might be used as a precedent and on whether this country would be less vulnerable to sanctions than other member states because of the line that we are taking in the EU on hormone-treated beef?

The Minister said that we had spent 20 minutes talking about bananas; I do not know whether it was as long as that, but this is an important debate and we welcome the opportunity to hold the Government to account. A more constructive way of doing that, which we on the Opposition Front Bench pursue, is tabling pertinent questions and asking the Government for answers, rather than tabling muddled motions, as the Liberal Democrats do, and trying to justify them in speeches that leave much to be desired. People want clear thinking brought to bear on these important issues, which affect our country, our trade and our prosperity.

2.48 pm

Mr. David Drew (Stroud)

I am delighted to take part in this debate on an interesting and important topic; the politics of food creates considerable interest, if not alarm, among the wider population on occasions. Conservative Members seem to be suffering from collective amnesia about their role in the evolution of various food policies, but I do not want to waste time on that. No doubt the result of the change in policy will be put around in a brown envelope, like most Conservative policies at present.

We approach the debate with some trepidation. It is easy to raise alarms and, to be a little critical, although I agree generally with what the hon. Member for Eastleigh (Mr. Chidgey) said, some of it was on the alarmist side. This is an emotive subject. People are understandably worried by any accusations about links between this and that, and what may seem to be a perfectly good way to improve choice and the quality of our food can lead to alarming statements being made in the press, if nothing else. Nevertheless, we must recognise that consumer choice, if not paramount, is very important in this context. What we are discussing is the essence of why we engage in trade. It is through specialisation that we are able to obtain the best products from various parts of the world, and we must try to avoid any action that would prevent that from happening.

A chord has been struck. I feel strongly about this, as, I think, do others on both sides of the House. People feel that they have been disempowered by the way in which globalisation has made the providers of food unaccountable, in the sense that decisions are made not through the natural—dare I say, national—process that most people want, but by unaccountable individuals in multinational companies, American agrochemical companies or other multinational companies in other parts of the world.

We are, in fact, particularly able to point the finger at American agrochemical multinationals. I make no apology for taking all possible opportunities to talk about genetically modified organisms. I hope that Ministers do not think that I will launch into a full-scale attack on them, but I do not think that we would be where we are today were it not for Monsanto's—in my view—dreadful and disastrous decision not to segregate soya, which has led to a lack of consumer confidence. Consumers feel that foodstuffs have been imposed on them.

I was glad to hear confirmation from Ministers that we are demanding consumer choice, as we always do. There should be segregation, and there should be effective labelling; but it is not an easy matter, because decisions are being made elsewhere. We are discussing an aspect of that today: we are discussing a further racheting up of the apparent ability to impose decisions from outside. I think that we are well within our rights to say what we feel about that. In this respect, I am thankful that we are part of the European Union, because we can make a much bigger impact as part of a group of nations than we could as an individual nation. Let us not fool ourselves: as an individual nation, we would find it much more difficult to restrain the multinationals from securing a global marketplace in which they can determine what is provided and at what price it is provided, and regulation can be undermined, if not circumvented.

Mr. Gray

Does the hon. Gentleman favour the commercial planting of genetically modified crops, or not?

Mr. Drew

My views may differ somewhat from those of the Government, but in terms of degree rather than perspective. I believe, at the moment, that the precautionary principle is such that the benefits of genetically modified organisms are not proven, although I see every reason to conduct more tests—for instance, by means of farm trials. The Government have upheld the view that we should not currently be allowing commercial exploitation—unlike the last Administration, who allowed more products through without the necessary monitoring and regulation, and without truly believing that people should have a choice. Labour Members will not take any lessons about licensing and regulations: we are doing things properly, and it is a pity that that did not happen before our election.

We understand that the international trading position presents another side of what most people are concerned about—their right to choose, to know what they are eating, to know that it is safe and wholesome and to know that they can obtain it in as environmentally friendly a way as possible. There is a very sad aspect of what has been happening. The debate provides me with an opportunity to say that, although we understand that the interests of different nations are likely to be paramount in their decision making, we should all like to avoid disputes such as this if that is at all possible. We would not like it to be exaggerated, although that is always a danger in the lead-up to negotiations; but, more particularly, we do not want the matter to be subject to innuendo that could be taken out of context. That might lead to a much more serious situation.

Other hon. Members may, like me, have received a letter from the Food and Drink Federation stating that food and drink exports accounted for £732 million last year—slightly less than imports. I always think that those who cause problems by threatening retaliation may have more to lose than they stand to gain. Anyway, the letter listed the products that might be affected: beef, pork, poultry, tomatoes, onions, peaches, pears and, dare I say, chocolate. Such a degree of retaliation takes us on to the slippery slope leading to something that none of us wants—a full-scale trade war.

Everyone would lose out from such a trade war, but, as has been made clear by Conservative Members, those who would lose most are the smaller producers—the producers of specialist lines, who cannot diversify because their methods of production relate directly to their markets. We can only argue on behalf of producers, but, as we know from the banana controversy, the biggest loser is the third world. To an extent, we have been willing to fight alongside the third world to ensure that its countries have access to world markets. It is not right for large global companies, perhaps working through one Government or another, to be able to impose a different way in which products can reach the market if it is unfair, biased and clearly opposed to the greater access to the world market of third-world countries that most of us want.

That is linked to other issues, such as the multilateral agreement on investment. I was pleased to note that that had been kicked out initially; it may return in a different form, but I hope that its new form will enable us genuinely to believe that it is for the right purpose, and that investment streams will be made more accountable, rather than being driven by companies that are motivated by selfishness and are able to impose their will and influence the third world much more than is healthy.

We should improve the processes whereby we agree on the stabilisation of world trade. People may make suggestions about how we can learn from our mistakes. It has been alleged—I cannot confirm or deny the allegation—that, to an extent, the current problem has been caused by, in particular, the Americans, who have been testing World Trade Organisation processes to see how far the disputes mechanism can be pushed. If we take that allegation to its origins, we must ask who has been testing the process—and, again, we would tend to point the finger at some of the larger companies, which may feel that, if they get their way now, they may be given further opportunities in the future.

There is a lot to be played for. As the Government have said, we must cool this down. We must find a way of putting world trade back on track. If the dispute escalates, we shall all lose out, including those who are taking retaliatory action.

If I point the finger again at the European Union, I do so because some of the processes whereby agreements are reached are pretty Byzantine, and lacking in transparency. Whether we agree with the science is one thing, but I think that we should be happier if the mechanism for agreements were clarified to some extent. We could then hold our heads high when talking to the Americans, Canadians or whoever and say, "We have done it by the book. We know what we are about. We have been clear with our own multinational companies about the way in which they can influence the processes that we are engaged in." As a result, world trade would, I hope, be in a stronger, more stable position and we would all be gainers.

Although Labour Members have some sympathy with some of the words and phrases in the Liberal Democrat motion, the only way forward is the Government's approach, which is to negotiate, to consult and genuinely to try to bring the parties together, whether nationally, or, more particularly, supranationally, to ensure that the people who would lose out more than anyone—small specialist producers, the third world and, eventually, the consumer—are protected. There is no future in a retaliatory regime, which could be the way that some countries, or some companies, would want us to go. We have to square that with consumers' demand for safety, which is paramount; their demand to know what they are eating, and whether it is GM food; and their demand that, if they do not wish to eat GM food, they do not have to. As a result, the world would be a better and, indeed, safer place.

3.2 pm

Mr. James Gray (North Wiltshire)

It is an honour to take part in what is an important debate and to follow my near neighbour, the hon. Member for Stroud (Mr. Drew), although, having heard his thoughtful speech, I am not entirely clear about whether he agrees with Ministers' decision to allow the commercial growth of GM crops. Nor am I clear about whether he is in favour of the continuing import of hormone-improved beef. If he is, I wonder whether he has consulted the Gloucestershire National Farmers Union on the subject, and considered the damaging effect that it would have on beef farmers in his rural constituency.

Incidentally, the Labour party makes great play of the fact that it represents more rural constituencies than the Conservative party. That is statistical nonsense, but I pay tribute to the hon. Member for Stroud, who does indeed have a rural constituency and should always be listened to on rural matters. I am certain that the Gloucestershire National Farmers Union will get in touch with him about his opinion on hormone-modified beef.

I am grateful to my hon. Friend the Member for Christchurch (Mr. Chope), who accurately summed up Conservative Members' significant concerns about the imminent trade war, and made some good points about Liberal Democrat Members' general woolliness and lack of clarity. This is the most important day in the Liberal Democrats' parliamentary month, but, for most of the debate, far more Conservative than Liberal Democrat Members have been present. At one stage, only two Liberal Democrats were present, although, admittedly, there are a limited number of Liberal Democrat Members. The Liberal Democrats have raised a subject that has attracted few of their Members and I suggest that, the next time they secure an Opposition day debate, they think up a subject that actually attracts the attention of their Members and voters, rather than something that is of peripheral interest to them.

I am glad that one or two more Liberal Democrats have drifted into the Chamber. No doubt, seeing the name of a Conservative Member on the screens, they have come to find out a thing or two about the subject that they themselves proposed to discuss. We will no doubt hear more about that in the next debate, which, in the view of all Conservative Members, is a particular waste of time.

The lack of interest among the Liberal Democrats in the subject of the debate has been mirrored throughout England by their appalling results in last week's local elections.

Mr. Paul Tyler (North Cornwall)

Will the hon. Gentleman give way?

Mr. Gray

I will in a moment, if I may just finish my train of thought.

I think, in particular, of constituents of mine in the town of Wootton Bassett. Until last week, they had a Liberal Democrat town councillor, district councillor and county councillor. They now have a Conservative-controlled town council, Conservative district councillors, Conservative county councillors, a Conservative Member of Parliament and a Conservative Member of the European Parliament. That shows what the country thinks of the Liberal Democrats and today's debate shows why they think it.

Mr. Tyler

In the almost complete absence of all his Conservative colleagues, I wonder how the hon. Gentleman has the nerve to get up at all, but why does he think that his views on the local government elections have anything to do with genetic modification, unless he himself has been genetically modified, which may be possible?

I wonder whether the hon. Gentleman has noticed that, in 1995, his party lost more than 2,000 seats. Therefore, to regain their 1995 position and to have had any hope of forming the Government again, his party should have won 2,000 seats last week, which it patently did not.

Mr. Gray

rose—

Mr. Deputy Speaker

Order. Before the hon. Gentleman addresses the House again, perhaps we can return to the subject of the debate.

Mr. Gray

You are, of course, right, Mr. Deputy Speaker. The hon. Member for North Cornwall (Mr. Tyler) has highlighted two things. First, he has not been here throughout the debate; he walked into the Chamber and thought to make a cheeky intervention. Secondly, he has not even read his motion, which has nothing to do with GM crops. The fact that he thinks that I should be talking about GM crops shows how little he knows about the debate.

Mr. Tyler

Will the hon. Gentleman give way?

Mr. Gray

I am sorry. The hon. Gentleman has just walked into the Chamber. He has already made one particularly inane intervention; I am not prepared to take any further interventions from him.

Mr. Tyler

On a point of order, Mr. Deputy Speaker. I attended the opening speech in the debate and I listened to much of the Minister's speech. I was called away on my parliamentary duties elsewhere. I should remind the hon. Member for North Wiltshire (Mr. Gray) that I and my colleagues and I actually went to the WTO to discuss the matter long before his party woke up to the concerns that were being expressed.

Mr. Deputy Speaker

That is not a matter for the Chair.

Mr. Gray

We are glad to see the hon. Gentleman back in his place.

We are not talking about GM crops. That is a peripheral issue. We are talking about the real possibility that the world and our nation face a very damaging trade war. It is a trade war that damages not the European Union, our Government or us in this place, but businesses throughout Britain. That is what we are talking about. Today, there has been much peripheral talk about all kinds of things, but we must concentrate on the possibility of a full-scale trade war, which represents a threat to global prosperity—and, my goodness, global prosperity already has enough to worry about with the cold wind coming from the far east and Russia. One thing that we do not need is a trade war across the Atlantic between, as the Minister correctly pointed out, two of the oldest trading friends in the book: the United States and United Kingdom. We have been trading partners for centuries. That has nearly always been the case: there have been a few little local difficulties such as the Boston tea party, which the Minister mentioned. Apart from that, we have always been the best of trading partners.

If there is an outcome to today's debate, it must be the reiteration of our determination to maintain those trade links across the Atlantic, and not to allow some of the current disputes to interfere with that. We must reiterate our determination that, where we see trade disputes on the horizon—for example, a dispute over air freight is definitely coming our way—rather than allowing them to develop into a gigantic trade war, we will find ways in which to smooth them over, to come to some agreement with our American partners as well as involving our European partners.

In that context, I find the history of the recent banana dispute worrying. The Labour Government go to great lengths to tell us of their strong links in Europe and with President Clinton. The Government had the presidency of the European Union when the banana dispute was breaking. As far as I am aware, the Government never even mentioned the dispute in any of their public announcements during their presidency. They certainly took no steps to do anything about it.

The Government wasted an opportunity during their presidency by not addressing the dispute. The net result is the $191 million worth of sanctions that the WTO has now allowed the United States to apply against the European Union. Of course, those sanctions have not been imposed on EU banana businesses but EU businesses in entirely unrelated trades and industries.

The suggestion that that came as a surprise to the Labour Government during their presidency is nonsense. We know that, for six years, the battle has rumbled backwards and forwards and that the EU has consistently failed to comply with GATT and WTO regulations. The EU has said, "No, no, no—the United States action was unauthorised". Although the EU is probably technically right that the US took action before the WTO had authorised it, the facts remain that the dispute has continued for six years, that we saw it coming, and that the United Kingdom, in leading the EU, took absolutely no action to see it off. The Labour Government have to answer for that omission.

If the Government are so close to the European Union; have such good links with the WTO; and are leading in European matters, in WTO matters relating to the United States and in international affairs—although their recent lead in international affairs does not fill me with great confidence—they will have to tell us why they allowed bananas, of all things, to wreak the consequences described by my hon. Friend the Member for Christchurch. Although the banana dispute has been partly resolved, as current contracts have not yet expired, the dispute's effects will continue to be felt for at least another nine months.

Conservative Members have already alluded to the dispute's consequences. We know, for example, that the cashmere industry has been helped out. Far be it from me to use the dreadful expression "pork-barrelling" in the Chamber, but it seemed quite extraordinary that a Labour Government who were terribly concerned about the outcome of the forthcoming Scottish parliamentary elections should go to such huge lengths to help out the border industries.

A moment or two ago, in justifying the action, the Minister said that cashmere products are manufactured also in Bradford. Perhaps he thinks that that justifies the Government's action. Fine; if they think that that makes it all right, I apologise for having cast any aspersions on the Minister. Nevertheless, it is particularly peculiar that the Government should have gone to such great lengths to help the cashmere industry—even if there is one in Bradford—but ignored other industries, about which I shall speak.

Mr. Battle

The hon. Gentleman's allegation was that the cashmere industry was helped in certain areas to damage the Conservatives' electoral prospects in the Scottish parliamentary elections. However, such a charge is manifestly untrue, as the industry is located beyond Scotland. I tried earlier to explain that there had to be intervention in the cashmere industry because—unlike in the other affected sectors—the sanctions were imposed right in the middle of that industry's buying week, which is a specific annual event.

Mr. Gray

The allegation was not that the Labour Government were helping Conservative areas—we all know that there are no Conservatives in the Scottish borders—but that the Government were very concerned about the outcome of the imminent Scottish general election. In retrospect, they were right to be so concerned. They went out of their way to help Scottish industries, but not English ones.

I should mention a few of the industries that will continue to be damaged by the US sanctions. They include the handbag industry; the uncoated felt paper industry—[Interruption.] Hon. Members may laugh and think that those are only small industries, but other damaged industries include those that manufacture folding cartons, boxes and cases of non-corrugated paper, and lithography. All those who make cardboard boxes, or any paper product, are being hurt, as are those who manufacture bed linen and other linen—of whom the Minister has made so light—lead-acid storage batteries, and electronic tea and coffee makers.

All those British industries are highly profitable and are composed largely of small businesses. Entrepreneurs have established those businesses, often exporting their products to the United States. Now—because the Government were unable to resolve the banana problem during their EU presidency—those businesses face bankruptcy, redundancies and other problems.

My hon. Friend the Member for Christchurch mentioned Beamglow, which is a very good example of the type of company being affected by the sanctions. It is a family company, employing 100 staff, with a £6.5 million turnover. It has just opened a new New York office, at a cost of £250,000. It has also invested £2.5 million in new plant, specifically so that it might be able to export to the US. However—because of the muck-up over bananas—Beamglow is being denied the right to export to the US. People precisely like those at Beamglow are the ones who are being damaged by the trade war. They are exactly the type of people to whom the Labour Government have failed to pay any attention. Ministers went out of their way to look after cashmere, but what about Beamglow, in Cambridgeshire?

Mr. Drew

Will the hon. Gentleman give way?

Mr. Gray

Of course; I am happy to give way to my next-door neighbour.

Mr. Drew

Is my near neighbour suggesting that some of the American tariff policies are of recent origin? As he may know, traditionally, American policy has blocked foreign aerospace industries from entering the United States. The latest policy is therefore not new, but only more specific. We should lay the blame where it belongs: the Americans should not be imposing the sanctions.

Mr. Gray

I am grateful for that intervention— although it was wide of the mark. Beamglow, of course, has absolutely nothing to do with the aerospace sector. The dispute to which the hon. Member for Stroud may have meant to refer is the one on air freight, which I foresaw. As the hon. Gentleman will undoubtedly know, the Americans are currently claiming that it is reasonable that American air freight companies should be allowed to fly to the United Kingdom, offload freight and then go on to Europe— which the Americans believe is one entity— whereas British air freight companies may not go to America, offload and go on to another American airport. Therefore, America is not only proposing a form of protectionism for its own air freight industry, but arguing that we cannot contest it.

As I told the Minister a moment ago, the Government should not simply wait for the air freight dispute to come along and hit them in the face, but take action now to try to put it right. Ministers will say that they are taking action on it, but, as they know—although they have been ready to meet Federal Express, the largest American importer, and hold interesting talks on how it might be accommodated—they have refused to meet the British Air Freight Transport Association. No meetings with Ministers have been possible, because they have been so busy talking to Federal Express.

The Government must not take that type of attitude to dealing with international trade. They must realise that various issues are just about to come along and whack them in the face. They should meet representatives of the British industry and the American industry and find a solution to the problem that favours neither one side nor the other. I suspect that Ministers are at least partly culpable in not foreseeing some of those trade disputes, which have the most damaging consequences.

Mr. Battle

Early-warning arrangements are now in place, and the Government played a part in their establishment.

Mr. Gray

I am grateful to the Minister for that intervention, and am glad that arrangements are in place. I very much hope that they work. This time next year, when we have another debate on trade disputes, I very much hope that it will be held in a spirit of cross-party congratulation on the arrangements.

Mr. Battle

I doubt it.

Mr. Gray

I hope also that no such trade disputes will have arisen. The Minister doubts it, but I doubt it, too. I fear that, in the next 12 months, it is unlikely that the Government will perform any better than they have in the past 12 months. But—who knows—this time next year, when we again debate the subject, we might be pleasantly surprised.

I should like briefly to deal with the central issue of the debate—hormone-treated beef—and whether we should allow it to become a huge problem. I should say first that I am speaking as a Back Bencher, and as an hon. Member representing a beef-producing area in Wiltshire. I have not discussed my remarks with my own Front-Bench spokesmen on agriculture and trade. I should not in any shape, size or form claim to be speaking for the Conservative party.

My own view on the issue of hormone-treated beef is a very plain. I find it curious that, of all the European Ministers discussing the matter, only one—the British Minister—took a different view on the issue. Only the British Minister chose to ignore the available scientific evidence on allowing imports from the United States of hormone-treated beef.

The Minister of State, Ministry of Agriculture, Fisheries and Food grins knowingly, as if he is about to tell me that he has no evidence that there is something wrong with hormone-treated beef. I shall quote to him from no less an institution than the Parliamentary Office of Science and Technology, which has produced a very learned paper on the subject of hormones and their dangers. In words very much of one syllable, the report says that POST is extremely concerned about the health effects of such hormones.

The report states that oestrogens generally are linked with increased risk of endometrial and breast cancers in women and to reproductive disorders in men; they have also been shown to be carcinogenic in animal tests. Progesterone increases the incidence of ovarian, uterine and mammary tumours in experiments in laboratory animals. Testosterone may be carcinogenic in humans, having been linked with prostatic tumours in men; it has also been shown to be carcinogenic in animal tests.

That is pretty clear evidence that there may be a danger in humans eating hormone-treated beef. Regardless of that, there seems to be a reasonable presumption that there may be some dangers in eating hormone-treated beef. Compare that evidence with evidence from the Government's own scientific advisers on beef on the bone—which they have chosen to ban.

Mr. Battle

Will the hon. Gentleman give way on that point?

Mr. Gray

I shall, in a moment, give way on that specific point. Many scientists, quoted extensively in the paper, say that there may be health dangers associated with eating beef fed on hormones. The Government's scientific adviser went to some lengths to say that he thought that there was not much evidence of health risks from eating beef on the bone, but, like any scientist, he could not swear blind that there would never be any risk. Most scientists now reckon that there is a one in 2 billion chance of contracting a disease through eating beef on the bone. Whatever the Minister may be about to say about the POST note from which I quoted, the scientific evidence is clear that people are by no means convinced that eating hormonally modified beef is safe.

Mr. Battle

People may not be convinced, but we should read the full report, not quote selectively from it. The hon. Gentleman is quoting scientific evidence of health effects from the POST note. He stopped reading before the following paragraph: While few question the academic credentials of the evidence cited by the EU, much of it refers to levels of exposure many times higher than those likely to be encountered via hormone residues in meat. The key question is whether similar effects occur at these lower levels of exposure. Here the EU's position on the risks posed by hormone residues in meat seems somewhat out of line with the views of other national and international bodies. I do not have time in an intervention to read the following three columns that spell out the counter-evidence. The hon. Gentleman should give both sides.

Mr. Gray

I am grateful to the Minister for his further quotation from the POST note. Those who are interested will doubtless be able to look at it in the Library. My main point was not that it gave convincing evidence of a health risk. My goodness, if we knew for sure, as the Minister seems to suggest, that hormone-improved beef was definitely bad for human beings, no Government of any complexion in any country would ever allow it to be sold. At no stage have I suggested that it is definitely bad. All I am saying is that the Parliamentary Office of Science and Technology says that it might be dangerous and other scientists say that it might not be. There is a scientific debate about it. Almost nobody in their right mind—with the honourable exception of the Government—would suggest that beef on the bone was harmful, whereas many eminent scientists suggest that hormonally modified beef might be.

More importantly, British beef farmers are facing the worst time that they have ever had. They are unable to sell their beef overseas because of the ineptitude and inadequacy of the Minister of State at MAFF. Our beef farmers cannot export perfectly healthy beef, but the Government are saying that we should allow the Americans to export beef that many scientists believe could be very damaging to human health. There is something wrong with that. On behalf of the beef farmers of north Wiltshire, I find that worrying and disturbing. I am sure that they will have some powerful comments to make in the aftermath of the debate.

Leaving aside the medical and scientific discussion, the Conservative party is wholeheartedly committed to free trade, in contrast with the Liberal Democrats, and perhaps the Labour party, given some of the comments that we have heard this afternoon. Freer trade in Britain means solving the disputes over beef and bananas. It means foreseeing disputes such as that over air freight. It means using influence in Brussels and Washington, not just talking about it, setting up a committee or putting out a press release. Too often, the Labour Government's approach to international problems is to do whatever will look good in the papers tomorrow. It is not about winning the battle of spin, but about addressing the difficult questions, not just in public, but behind the scenes. That requires careful, quiet diplomacy over long periods to solve disputes, not the headline-grabbing, "I'll have a go at them" approach to which the Government too often resort.

From what I have seen of the Government's priorities on the issue so far, they are more interested in currying favour with Mr. Clinton and now with Mr. Prodi than in pulling off the gloves and sticking up for British industry, British jobs and the British consumer.

3.24 pm

Mr. Colin Breed (South-East Cornwall)

The motion and the Government amendment refer to the interests of the developing world. I should like to focus on that. Less-developed countries are just as vulnerable to the new biotechnology and to the way in which WTO rules will be interpreted. Genetically modified food has been heralded by many as an answer to famine and starvation in the developing world. It is said that enormous quantities of food from genetically modified crops could be produced in areas that are currently infertile. Apparently, drought-resistant crops could allow farmers in some of the poorest areas of the world to grow food to sustain themselves.

That is laudable and I am sure that we all wish that it were true. However, I am sure that many hon. Members agree that some GM crops come at a dangerously high price. First, GM food is produced by a relatively small number of multinational companies. Ten companies control around 85 per cent. of the global agrochemical market. Secondly, the so-called terminator or suicide seed technology involves a gene that makes seeds infertile. In a GM world, farmers could no longer store the seed produced by the previous season's crops, but would have to buy new seed each year. That is clearly to the advantage only of the seed producers and the companies that own the patents and will increase the costs to poor farmers in third-world countries. Thirdly, GM crops are designed mainly for the intensive farming prevalent in western agriculture, which is inappropriate for the delicately balanced ecosystems of less-developed countries.

One of the other so-called advantages claimed for GM food is that it will reduce the world's damaging over-reliance on pesticides, allowing pest-resistant crops to flourish. However, far from relieving agriculture of the need to pour a dangerous cocktail of chemicals on to the crops, genetic engineering is tailored to reinforce farmers' dependence on certain chemical herbicides and fertilisers. GM crops are designed to work in tandem with specified pesticides, having the pest-resistant gene as part of the process of genetic modification. When the field is sprayed, all the weeds will die, leaving only the crop. The farmers have to buy not only the seed, but also the relevant pesticide. For example, Monsanto crops will be resistant only with Monsanto pesticides. That probably comes as little surprise to any of us.

The proponents of GM food accuse those of us who may be more cautious of denying food to the hungry. However, there is a growing fear that the sated and wealthy are making money out of the hungry and poor, then threatening action through WTO rules to enforce the largely unproven and potentially dangerous science on unsuspecting third-world farmers. They argue that genetically engineered crops will feed the growing third-world population. However, this week's Christian Aid report on GM food and the developing world showed that to be a false and deeply misleading claim. There is already enough food to feed everybody in the world. According to the UN world food programme, there is one and a half times the amount required, but one seventh of the world's population—around 800 million people—still go hungry.

Our supermarket shelves are stacked high with exotic products of all shapes and sizes from all parts of the world. Certainly, there is no shortage of food in south-east Cornwall—or, I suspect, in any other constituency in the country. There seems to be no problem in bringing food from far-flung places to our supermarket shelves. Yet there seems to be a distinct problem the other way round.

In 1984, at the time of the Ethiopian famine, some of the prime agricultural land in the Horn of Africa was used to produce linseed cake, cottonseed cake and rapeseed meal for export to Britain and other European nations as feed for livestock. That was clearly ridiculous and, as a result of the famine, the EU—including this country—pumped millions of pounds of aid back into Ethiopia.

The west has enough food to feed itself many times over. The problem is not quantity, or even quality, but distribution—getting the food that can be produced in ordinary circumstances to those who need it. Unfortunately, there appears to be very little profit in distribution, so few commercial concerns are interested and little interest is shown by Governments in tackling properly the problem of distribution.

The very fact that those poor countries cannot afford the food to feed themselves adequately will not be changed by the introduction of genetically modified crops. If anything, it will widen the gap between the well-fed haves and the hungry have-nots. The developed countries can afford expensive biotechnological crops in combination with equally complex pesticides, whereas the developing world simply cannot.

The Ethiopian representative to the bio-safety protocol negotiations, which were part of the convention on biological diversity, said: There are still hungry people in Ethiopia, but they are hungry because they have no money, no longer because there is no food to buy. The biotechnology industry's claim that its research is motivated by a need to feed the hungry is clearly unsubstantiated. Few of the foods so far produced are likely to benefit poorer people in the developing world.

One of the main genetically engineered crops grown commercially in the United States is soya. Some 90 per cent. to 95 per cent. of the soya bean harvest and 60 per cent. of traded maize are consumed not by people but by livestock. The argument by multinationals in favour of GM foods—that they eliminate hunger—is simply wrong.

The answer to the problem of feeding the burgeoning world population is not GM foods, or increased fertiliser use. Green techniques can adequately cope with the increased demand. For instance, in southern Brazil, 250,000 farmers using green techniques doubled both maize and wheat yields, while 200,000 farmers in Kenya increased productivity by 50 per cent. However, in India, to increase the grain yield by four times since 1950, fertiliser use has had to increase more than 200 times over.

GM crops are being designed for western intensive farming techniques, and the impact on the delicately balanced environment of the scale of factory farming needed to justify GM crops is immense. For instance, Jules Pretty of Essex university cites evidence from 20 countries of 2 million households farming 5 million hectares in a more sustainable manner. They all use techniques that have stood the test of time, such as multi-cropping, reduced chemical input, local seed and using the knowledge, skill and experience of local farming. Those techniques are sustainable and suit the local environment.

The introduction of single GM crops would necessitate immediately the greater use of fertilisers and pesticides, damaging the delicately balanced local ecosystem. Many farmers in poorer countries will be encouraged to grow cash crops. That is happening already, with supermarkets contracting growers in third-world countries to grow vegetables such as carrots—using cheap labour and huge amounts of water—and encouraging them to use GM seed where there are no restrictions.

Those crops are not available or eaten by the indigenous population and contribute nothing to relieving hunger there. They only enable the foreign currency earned to pay the interest on the country's foreign debt, which is unsustainable, both environmentally and economically.

A combination of aggressive seed producers and the purchasing power of western supermarkets is forcing GM crops on to less-developed countries, causing potentially catastrophic damage. With ever-growing public apprehension, particularly in Europe, more attention will be given to those less-developed countries. All of this is being reinforced by so-called free trade obligations under WTO rules, which I believe serve more the greed of western commercial interests than balancing and promoting proper trade which is fair and environmentally sustainable.

It has been argued that genetic modification is merely an extension of selective breeding, something that has been used for thousands of years to influence which genes are passed between generations of plants and animals. However, the advent of GM crops is completely different. There is no longer a DNA river flowing and branching through geological time with steep banks confining each species. GM crops are the bursting of those river banks, with such absurdities as tobacco modified with genes from the Chinese hamster. The DNA river is beginning to flood. Only prompt action and rigorous scientific testing can prevent as yet unknown damage occurring to the animals and plants of the world.

It is essential that future negotiations on the liberalisation of trade fully take into account food safety, the protection of biodiversity and assistance for the economies of less-developed countries, rather than promoting the interests of greedy commercial companies that use their dominance not only in their trading practices but through political lobbying of the worst kind. Developing countries must be taken into account in the WTO millennium round negotiations in discussions on matters of so-called free trade.

As this is Christian Aid week, it is an ideal opportunity to let people in some of the poorest developing countries take precedence, for once, over the agrochemical super-giants and commercial operations such as Monsanto.

Mr. Norman Baker (Lewes)

Does my hon. Friend agree that it is entirely wrong that the Department for International Development is not represented on the Cabinet committee dealing with biotechnology? Should not the Government correct that omission?

Mr. Breed

I am sure that the Minister will take that on board.

It is clear that the WTO negotiations go wider than their original purpose of a few years ago. Unless the negotiations take into account the wider aspects of the way in which trade takes place—particularly between large, multinational companies—they will fail to understand what we will need to examine in future. Biodiversity, its affect on less-developed countries and the way in which some companies will use WTO rules to drive through their commercial interests will be the central features of what we need to tackle in the millennium round of negotiations.

3.38 pm

Miss Anne McIntosh (Vale of York)

It gives me great pleasure to participate in this debate, as I have taken a great interest for months in the looming trade war. I am bemused by what I gather will be the Labour party's campaign slogan for the forthcoming European elections. Labour is talking about "Leading in Europe." This debate has shown that the Labour Government have woefully missed an opportunity to lead from the front in the EU on this matter—in particular, on food safety and our relations with third-world countries.

I wish to make a personal comment about the next motion on the Order Paper. The House will know that I am still a part of the Conservative group in the European Parliament, which is referred to in the motion. I have been called many things in my time, but I do not think that I have been called "complacent" before. Nor do I think that the word "antipathetic"—or, as the Spanish would say, "antipatico"—refers to me. I much prefer the word "sympathetic", or "simpatico."

My hon. Friend the Member for Christchurch (Mr. Chope) took a lead in showing that Conservative Members are much more in sympathy with the businesses in this country that are concerned about the Government's lack of leadership, especially in the banana debate, and failure to give any reassurance to the Caribbean countries concerned, which are members of the Commonwealth.

There is clearly an uneven playing field for our producers. I am deeply concerned because the Government appear to be all over the place on food safety. My hon. Friend the Member for North Wiltshire (Mr. Gray) referred to the fact that the Government readily banned the sale of beef on the bone, without conclusive scientific evidence, yet still allow in imported pork that we know comes from animals fed on meat and bonemeal. A complete assurance has been given to the British public that none of the meat produced and sold here is from such animals, but the imports continue, and that is deeply worrying. The imports also place our producers in an uncompetitive position.

The failure to lift by 15 June the ban on US beef produced with hormones means that further sanctions will have to be negotiated. There will be 100 per cent. import duties on a wide range of products, including pigmeat, poultry and tomatoes, corresponding to the estimated $500 million loss of earnings for the US cattle men. Have the Government considered the impact on UK producers of pigmeat, poultry and tomatoes, especially in the Channel Islands? What compensation might be offered?

I pay tribute to Sir Leon Brittan, who has led the negotiations in Brussels. The Minister was right to say that the European Union will rely on scientific evidence. That is being considered as we speak. If there is conclusive scientific evidence—which I believe there is—that hormone-produced beef is bad, I hope that the Government will show some leadership for once in Europe and move to ban the imports.

I would find it difficult to explain to both producers and consumers in the Vale of York that beef imports will be allowed in even though we know that there is conclusive evidence that the meat can be damaging to health. The motion refers specifically to food safety, but we must also consider what unfair competition there may be for beef producers. We do not have many in the Vale of York, but they will be very badly affected.

I pay tribute to my noble Friend Lord Plumb, who for the past few years has chaired the parliamentary assembly between the African, Caribbean and Pacific countries and the European Union, especially when it meets under the auspices of the European Parliament. We owe a great deal to that body for its efforts to bring the two sides together, especially in the banana debate.

The ACP agreements, through the first Lomé convention, considered sugar as a staple produce for many of the developing countries. We respect and admire the role that those countries play in the Commonwealth. Bananas are the only practical crop on which they can rely. We must not lose sight of the fact that the Canary Islands, within the European Union, produce the small, rather tastier and more delicate bananas that are preferred by the British consumer. I regret the fact that the Government have shown a distinct lack of leadership.

A wider trade war is looming. My hon. Friend the Member for North Wiltshire referred to the air freight agreement. It is most unhelpful that Ministers have found no time to meet the British companies involved. No British or European Union carrier is given access to United States routes—known as cabotage—for either freight or passengers, or is allowed to buy more than 49 per cent. of shares. The Government should take the opportunity to consider the fly America policy, whereby any US Government official must by law fly only on an American carrier.

My hon. Friend the Member for Christchurch referred to the hushkits agreement. It was reached only on the basis of postponement for a year. There was a strong British interest at stake: we would have lost our Concorde flights to the US because the Americans refused to accept that their reconditioned aircraft are simply too noisy. Anyone living near or representing an airport with those noisy aircraft will understand the problem only too well.

There are problems with bananas, beef produced with hormones, genetically modified organisms, hushkits and air freight. I yield to no one in my support for free trade between the EU and third countries such as the US, and I regret the increasingly protectionist moves by the US Government in their economic relations with the EU.

I regret the fact that—contrary to the slogan that we will no doubt hear over the next three weeks, in the context of the European Parliament elections, that Labour is "leading in Europe"—there has been gross lack of leadership and the Government are reluctant to apply the right to ban hormone-produced beef, which is enshrined in law under article 36 of the original treaty of Rome.

I urge the Government to show the House, the country and our partners in the European Union some leadership.

3.47 pm

Dr. Vincent Cable (Twickenham)

I make no apology for the fact that we have, for the second time in a short period, introduced a trade debate in the House. That reflects our recognition of how much our manufacturing and agriculture depend on an open trading system and the rule of law in trade; our concern about the threat posed by the current cycle of retaliation—there have been two major disputes—to large parts of our economy, including vulnerable constituencies; and our belief that the Government have a role and responsibility in the matter, because of our country's bipartisan tradition of support for liberal trade and because the Government, who, like previous Governments, are close to the Americans, can bring more influence to bear on the disputes than other European countries.

The issue is important, as the Minister acknowledged, and we are glad to have the opportunity to debate it. We begin to part company with him on the seriousness of the problems. The hon. Member for Vale of York (Miss McIntosh) captured very well the exact nature of the threats that we face. The Minister was right to say that there has been some scaremongering. Some have cried wolf, and whenever a trade dispute breaks out, some people prophesy the imminent collapse of our trading systems. The Uruguay round went through two years of trauma, but eventually the disputes were resolved.

It is possible to put a positive gloss on what is happening, but I urge the Minister to accept that the problems are serious, for several reasons, one of which is the fact the European Union and the United States, for very different reasons, are both behaving irresponsibly. The European Union is, to some extent, dragging its feet.

The hon. Member for Christchurch (Mr. Chope) accurately chronicled the history of the dispute. The foot dragging was partly for administrative reasons involving the slowness of getting 15 countries into line. There is also a highly reprehensible unwillingness to accept the rules of the dispute settlement procedures. That is unforgivable. On the other side, the United States, instead of waiting to see how the rules of dispute settlement can be implemented, rush in unilaterally, threaten sanctions, raise the temperature and make the problems worse. So there is blame on both sides, but it is a serious problem.

There is a deeper issue here. The international trading system now has to cope with more difficult and irreconcilable problems than those that faced early generations of trade policy makers. In the past, disputes were about tariffs and quotas. We are now dealing with something much more subtle—with what happens when, in opening up the trading system, we run into national health, hygiene or technical regulations. We are familiar with that in the European Union. Quotas and tariffs disappeared long ago, and there is now a long-established practice of harmonisation and mutual recognition to get over the problems. At global level, we do not have that framework.

It is easy to understand where the World Trade Organisation is coming from and why it tends to take a sceptical view of health restrictions. The classic case was Japan. The Japanese argued for many years that they could not possibly have imported beef because Japanese stomachs and intestines worked in a different way from ours. It was never clear whether they believed that scientific nonsense, but it was sustained none the less for many years. That provided the background to the somewhat sceptical approach to health standards that is often taken. The real danger is that genuine concerns about health are not taken sufficiently seriously. We are now seeing a generation of genuine health problems that have to be dealt with much more sensitively through international trade negotiations.

The underlying principle of international trade agreements is that they must be based on sound science. The problem with that is that it is a slogan. The slogan is right, but science constantly evolves, there is no settled scientific consensus and scientists in different countries say different things. Genuine public anxiety may not always be scientifically based. That is our difficulty in responding to the real issues of trade policy and the World Trade Organisation has not come to terms it.

My hon. Friend the Member for Eastleigh (Mr. Chidgey) rightly sketched out how we could extract ourselves from the beef hormone dispute, but a succession of other disputes is coming. It suffices for the purposes of this debate to sketch out the principles for handling disputes. The first is one with which the Government should feel comfortable because they are setting up a Food Standards Agency. The Minister of State, Ministry of Agriculture, Fisheries and Food is the architect of the agency. All major trading countries will have to have agencies independent of Government and the private sector to make credible scientific assessments.

A second principle is labelling. The Minister for Energy and Industry has sketched out the Government's commitment on labelling. It is surely a matter of fundamental principle that people should know what they are eating and make an informed decision about it. That may require a strict labelling regime. We have seen that, in the case of GM food, that is not easy, but we must insist on it as a matter of principle. It is a principle that the Americans have so far resisted. So a combination of independent standards agencies, labelling—in some case, obligatory labelling, but often it can operate on a voluntary basis—and international agreement backed up by dispute settlement procedures is the basic ingredient for preventing disputes from getting out of control.

The Liberal Democrats have tried to press the environmental agenda over the years. One issue that is looming is the inability of the international system to enforce multilateral environmental agreements. My hon. Friend the Member for Eastleigh has already referred to that. There is no reason why such enforcement should not be carried out within a set of multilateral trade rules. Many people who believe, as I do, in a liberal, open, free trade system believe that the WTO can adapt to the problem and build a set of safeguards into the rules without enormous difficulty. I hope that the Minister will tell us that the Government are committed to the process and will take the lead in finding answers to the problem.

My hon. Friend the Member for South-East Cornwall (Mr. Breed) referred to the problems posed by developing countries. In the past decade, there has been a big change in the way in which the developing countries see trade. Until the mid-1980s, many of them, especially the biggest such as China and India, maintained largely siege economies. It is now generally accepted that that was contrary to their interests. Many of them have now embarked on liberalisation, which is welcome from both their standpoint and ours. There are barriers to the continuation of that process, one of which is the fact that the western world is often highly hypocritical. We demand market access to developing countries, but we present serious barriers to their products, especially agricultural and manufacturing items. The developing countries then ask why they should comply with demands for, for example, social legislation that could be used as a barrier to their products.

The concern of developing countries that is more relevant to the debate is that many demands for access are driven by narrow commercial interests. What my hon. Friend the Member for Eastleigh said about GM foods needs repeating. It may well be that in the long term, GM seeds will be beneficial to a country such as India. I have an open mind about it. Certainly 30 years ago, the introduction of new agricultural technology transformed the economies and agriculture of the Indian sub-continent for the better. Perhaps the same thing will happen again. However, there is a crucial difference between then and now.

Thirty years ago, agricultural research was carried out independently. For example, research was done at the rice institute in the Philippines. That provided confidence for Governments and private farmers to introduce seeds on a voluntary basis. That process will not happen for GM technology if it is forced through by western Governments at the behest of some of their corporate clients. If developing countries are to be helped to maintain a broadly liberal approach to trade, which is in their interests, it will have to be done in a sensitive way. The way in which the United States is approaching the matter is not helpful.

In conclusion, I reiterate that the British Government have a responsibility and an opportunity to lead the international debate on trade policy. Britain has a creditable record. Whatever our differences with the previous Government, the right hon. Member for Huntingdon (Mr. Major) played a distinct and positive role in helping the Uruguay round to reach its conclusion. One of the unsung achievements of the late John Smith was that at a crucial stage in the Uruguay round, when he was Secretary of State for Trade, he pushed through key negotiating points that made it possible for the international agreement to be signed. We start from a broad consensus in Britain in favour of a liberal trading system. We now have an opportunity to address the issues of food safety and environmental standards in a way that is compatible with an open system.

3.59 pm

The Minister of State, Ministry of Agriculture, Fisheries and Food (Mr. Jeff Rooker)

I shall do my best to respond on behalf of the Government to what has been an important debate. I have the biggest audience of the afternoon, but I am not sure whether that is out of interest in my reply or because people are getting their seats for the next debate, which is obviously much more important, between the Liberal Democrats and the Conservative party.

Mr. Gray

Tickets are being sold.

Mr. Rooker

I understand that that is the case.

First, on the central issues regarding aspects of trade, I wish to make it abundantly clear that the rules of the World Trade Organisation do not stop the United Kingdom—or any country—from protecting public health through trade measures, where necessary. However, covert protectionism—the theme of some speeches this afternoon—is not allowed. If measures to protect public health or the environment are to succeed, the arguments must be based on some firm science.

Secondly, the WTO rules allow countries to take a precautionary approach by adopting provisional measures where there is insufficient information, provided that a serious attempt is made to establish a more informed basis for action within a reasonable period. Those two points are crucial. They are the foundation of the policy and underpin our negotiations in the WTO.

Mr. Chidgey

Does the Minister agree, in the light of his second point, that insufficient information is one of the EU' s key failings over modified beef?

Mr. Rooker

Of course it is. I shall come to the three elements featured in the debate—beef treated with hormones, bananas and genetic modification.

I shall deal with the hormone problem first. The present dispute has lasted a decade, as I have made clear. In addition, I made it clear—and I was not playing party political games with the hon. Member for Christchurch (Mr. Chope) when I said it—that the present Government have continued the previous Government's policy in respect of hormone-treated beef. We have not received any information or advice to cause us to change that policy. Nevertheless, we have gone along with the wider European Union decisions on the matter, and we have done our best to facilitate a solution. We take extremely seriously, the responsibility to protect consumers and we attach paramount importance to their safety and that of the environment.

The World Trade Organisation rules do not prevent us from taking action in that area, but that action must be based on science. The United Kingdom voted against the European Union ban on hormone-treated beef, on the ground that it was not justified by the science. Last year's WTO ruling came to the same conclusion. The Government will examine very closely the new studies released last week, and we will take independent advice as to whether they contain any new evidence that might alter the United Kingdom's view. That is consistent with our approach so far.

It would be useful for me to make it clear that there has been no ban on US beef as such, only on hormone-treated beef. In 1996, imports into the UK of bovine carcase meat amounted to 2,847 tonnes; in 1998, the figure was 1,580 tonnes, worth just under £4 million. The trade exists, but it is very small and concentrated on the high-quality end of the market.

It has recently been alleged that some of that beef was not hormone free, and the European Union has been in discussion with the Americans about that. Nevertheless, we have made it clear to both the US and Canadian Governments that retaliation against UK products is wholly unjustified. We want to deal with the matter calmly and objectively. Labelling is not the answer to everything, because labels would be attached only to products that were considered safe.

Labelling would not excuse unsafe products: we would not allow products to be sold that we thought were unsafe and posed a risk. Labelling exists to give consumers an informed choice about whether they wish to purchase hormone-treated American beef, non-hormone-treated American beef, or any other beef. That is one of the reasons why the beef labelling scheme operates on a voluntary basis in this country.

Mr. Gray

If it is so important that consumers can choose whether to eat carcinogenic American hormone-treated beef, or American beef that has not been treated with hormones, why does the Minister ignore consumer choice over beef on the bone in the United Kingdom?

Mr. Rooker

The hon. Gentleman has raised the matter of beef on the bone in about three interventions in the debate. I should be happy to defend the Government's position with respect to beef on the bone, but the interest evident in the next debate means that insufficient time is available. We have scientific and medical evidence that justifies the ban on beef on the bone.

The chief medical officer's lengthy and considered report, published in February, stated that the matter would be revisited in six months. Given that no beef is sold that is more than 30 months old—to which must be added the gestation period of the calf—and that the only known cause of bovine spongiform encephalopathy is maternal transmission, it is highly likely that there will be some advances in the policy. There is nothing new in that: we have said as much before. However, it is abject nonsense to argue that the existing ban is not based on scientific and medical evidence.

I shall turn, briefly, to bananas. The allegation has been made more than once in the past few hours that the Government took no action during our presidency of the EU on bananas. That is simply untrue, and I invite hon. Members to check the record.

European Standing Committee A met on 25 March 1998. I was the Minister dealing with the matter for the Government, and the hon. Member for South-East Cambridgeshire (Mr. Paice) led for the Opposition. He said: The Opposition support in principle the path that is being taken. Clearly, it is right for the EU to respond to the WTO ruling. It should be recognised that, as the Minister said, the Americans have very much driven that result."—[Official Report, European Standing Committee A, 25 March 1998; c. 18.]

He went on to say that the Opposition "support the Government's approach."

Indeed, in our time in the presidency, the Government succeeded in getting amendments to the banana regime from January 1999. Those amendments were challenged in the World Trade Organisation, and were found not to obey the WTO rules in all respects. That matter is now under active negotiation and discussion with all the interested parties, because we are not prepared to ignore the fragile economies of the African, Caribbean and Pacific countries.

We have a moral and economic obligation to ensure that we can find a solution to this difficult matter. I agree with some of the points made by Opposition Front-Bench Members about the level of American retaliation, which the arbitrator reduced from $520 million—with which the Americans had been proceeding unilaterally—to less than $200 million. As has been noted—and it is in line with the arbitrator's ruling—the United States has reduced the list of European Union products on which sanctions are imposed.

We are proceeding as fast as we can to solve a problem that is very difficult, but surely not intractable in a civilised world. We want to establish a trading relationship that is satisfactory for banana producers.

Mr. Chope

Will the Minister say what the Government will do to help the innocent victims of the banana dispute?

Mr. Rooker

All the victims of the banana dispute are innocent, especially the ACP countries. [Interruption.]

Mr. Deputy Speaker

Order. May I ask the House to come to order. There are far too many private conversations going on in the Chamber.

Mr. Rooker

After the discussions have been concluded, we shall bring to the House our proposals for a solution to the problem. Beyond that I cannot go this afternoon.

Many hon. Members have made points about genetic modification, trade and the Government's policy. Our policy on genetically modified organisms could have implications for our trading relations with the United States, but that is not so at present. Our primary duty is to protect people and the environment, not to take risks. People are not being used as guinea pigs, and we are satisfied that a comprehensive science-based framework is in place to regulate biotechnology and provide advice.

On 17 December, we announced a Whitehall-wide review of the regulatory process for biotechnology across the fields of human health, agriculture and food. I have told the Select Committee on Agriculture that we shall act on that before the end of the month.

GM crops have the potential to contribute to sustainable agriculture, provide environmental benefits and possibly enhance the competitiveness of UK industry. Some people do not like that idea, but it is true, and we are not prepared to walk away from science that could do all that. We are satisfied with the rigorous safety assessments, although we always seek ways to tighten them or to make them as transparent as possible.

Many hon. Members, particularly the hon. Member for Eastleigh (Mr. Chidgey), referred to the Christian Aid report. I want to record some comments made by Dr. Philip Dale, a senior research scientist at the John Innes centre in Norwich, in his response to that report. Dr. Dale has worked in the area for a considerable number of years, advising Governments in the third world and more modern Governments. He thought that the Christian Aid report read like a tabloid newspaper. The same could be said about the opening speech by the hon. Member for Eastleigh. Dr. Dale added: I find it a useful rule of thumb that if an article is entirely negative or entirely positive it is more about propaganda than informing people in a balanced way. The same has sometimes been true of today's debate.

Dr. Dale also said that concerns exist about the influence of multinationals, arguing that they must be watched carefully by Governments where necessary. The idea that a Government can never be trusted and that big business is always corrupt, while non-governmental organisations and campaign groups are always honest is highly prejudicial. It is ludicrous to base a policy on that position, but that was the thrust of the speech by the hon. Member for Eastleigh.

Dr. Dale—like, to be fair, Christian Aid—points out that more than 800 million people in the world are hungry although there exists one and a half times the food needed to feed the world. The problem is that the food is in the wrong place. We have to grow food where the starving people are, not distribute it to them as if they were refugees. It is possible that GM technology may provide the answer to that problem, once it has been checked out.

In workshops in which Dr. Dale has been involved, people have told him that agonising over the application of GM pest and disease resistant crops is a luxury of an overfed society. They argue that they are losing substantial amounts of their food to pests and diseases, and in some instances are trying to control them by using cheap chemicals that have been banned in many developing countries. That is how it is in the third world where people are trying to grow crops, often using second-hand chemicals that we would not allow. New technology may make it possible for them to grow enough food without having to pour chemicals on to it. We have to discuss and investigate that possibility, not dismiss it with tabloid headlines.

Dr. Dale makes a final point about terminator crops, and we have made the same point before. No one ever mentions that the use of a terminator crop in agricultural terms…is little different from high yielding hybrid varieties which also cannot be used to save seeds. In those cases, too, seeds have to be purchased every year. Terminator technology may be an advance, particularly in northern Europe where we would not have to spray chemicals on people out in the fields in the following year.

Mr. Chidgey

Do the Government support the sale of terminator seeds to the third world, and do they support the ability of commercial companies to take out patents on indigenous crop varieties?

Mr. Rooker

There are no terminator crops at present. One would think that seeds were being planted. They are not.

Throughout the debate, it has been implied that Governments cannot be trusted and that companies are interested only in the benefits to their shareholders, as if it were likely that companies would gain from planting crops that poisoned people. We are determined to make sure that technology is controlled and that consumers have choice. I wish that segregation existed, and crops grown in the UK will certainly be segregated. We will proceed with farm-scale trials. No free-for-all is planned. In fact a moratorium has been placed on that, as we have made clear in previous debates.

Labelling and transparency will be ensured right down the chain. We are the only country in Europe in which, from September, labelling will be required even in restaurants and the catering industry. The Labour Government took that decision last August, not because it was requested in any parliamentary question and not because of any campaign in the newspapers. Indeed, our decision was not even commented on by the Consumers Association. We took that decision because we thought it right that consumers should have choice, and full labelling and transparency all along the GM food chain.

Question put, That the original words stand part of the Question:—

The House divided: Ayes 38, Noes 300.

Division No. 173]	[4.17 pm
AYES
Allan, Richard	Hughes, Simon (Southwark N)
Baker, Norman	Jones, Nigel (Cheltenham)
Ballard, Jackie	Kennedy, Charles (Ross Skye)
Beith, Rt Hon A J	Kirkwood, Archy
Bell, Martin (Tatton)	Livsey, Richard
Brake, Tom	Maclennan, Rt Hon Robert
Brand, Dr Peter	Michie, Mrs Ray (Argyll & Bute)
Breed, Colin	Oaten, Mark
Bruce, Malcolm (Gordon)	Öpik, Lembit
Burnett, John	Rendel, David
Burstow, Paul	Russell, Bob (Colchester)
Cable, Dr Vincent	Smith, Sir Robert (W Ab-d-ns)
Campbell, Rt Hon Menzies (NE Fife)	Taylor, Matthew (Truro)
	Tonge, Dr Jenny
Chidgey, David
Cotter, Brian	Tyler, Paul
Davey, Edward (Kingston)	Webb, Steve
George, Andrew (St Ives)	Willis, Phil
Hancock, Mike
Harris, Dr Evan	Tellers for the Ayes:
Harvey, Nick	Mr. Adrian Sanders and
Heath, David (Somerton & Frome)	Mr. Paul Keetch.

NOES
Abbott, Ms Diane	Donohoe, Brian H
Adams, Mrs Irene (Paisley N)	Doran, Frank
Ainger, Nick	Drew, David
Ainsworth, Robert (Cov-try NE)	Drown, Ms Julia
Alexander, Douglas	Dunwoody, Mrs Gwyneth
Allen, Graham	Eagle, Angela (Wallasey)
Ashton, Joe	Eagle, Maria (L-pool Garston)
Atherton, Ms Candy	Edwards, Huw
Austin, John	Efford, Clive
Barnes, Harry	Ellman, Mrs Louise
Barron, Kevin	Ennis, Jeff
Battle, John	Fisher, Mark
Bayley, Hugh	Fitzpatrick, Jim
Beard, Nigel	Flint, Caroline
Begg, Miss Anne	Flynn, Paul
Benn, Rt Hon Tony	Follett, Barbara
Bennett, Andrew F	Foster, Michael Jabez (Hastings)
Benton, Joe	Foster, Michael J (Worcester)
Bermingham, Gerald	Fyfe, Maria
Berry, Roger	Galloway, George
Betts, Clive	Gardiner, Barry
Blackman, Liz	George, Bruce (Walsall S)
Blears, Ms Hazel	Gerrard, Neil
Blizzard, Bob	Gibson, Dr Ian
Borrow, David	Gilroy, Mrs Linda
Bradley, Keith (Withington)	Godman, Dr Norman A
Bradley, Peter (The Wrekin)	Godsiff, Roger
Brinton, Mrs Helen	Goggins, Paul
Brown, Russell (Dumfries)	Gordon, Mrs Eileen
Browne, Desmond	Griffiths, Jane (Reading E)
Buck, Ms Karen	Griffiths, Win (Bridgend)
Burden, Richard	Gunnell, John
Burgon, Colin	Hain, Peter
Butler, Mrs Christine	Hall, Mike (Weaver Vale)
Byers, Rt Hon Stephen	Hall, Patrick (Bedford)
Caborn, RI Hon Richard	Hamilton, Fabian (Leeds NE)
Campbell, Mrs Anne (C'bridge)	Heal, Mrs Sylvia
Cann, Jamie	Healey, John
Caplin, Ivor	Heppell, John
Casale, Roger	Hewitt, Ms Patricia
Caton, Martin	Hill, Keith
Cawsey, Ian	Hinchliffe, David
Chapman, Ben (Wirral S)	Hodge, Ms Margaret
Clapham, Michael	Hood, Jimmy
Clark, Paul (Gillingham)	Hope, Phil
Clarke, Charles (Norwich S)	Hopkins, Kelvin
Clarke, Eric (Midlothian)	Hoyle, Lindsay
Clarke, Rt Hon Tom (Coatbridge)	Hughes, Ms Beverley (Stretford)
Clarke, Tony (Northampton S)	Hughes, Kevin (Doncaster N)
Clelland, David	Humble, Mrs Joan
Clwyd, Ann	Hurst, Alan
Coaker, Vernon	Hutton, John
Coffey, Ms Ann	Ingram, Rt Hon Adam
Coleman, Iain	Jackson, Ms Glenda (Hampstead)
Colman, Tony	Jamieson, David
Connarty, Michael	Jenkins, Brian
Corbett, Robin	Johnson, Miss Melanie (Welwyn Hatfield)
Corston, Ms Jean
Cousins, Jim	Jones, Barry (Alyn & Deeside)
Cranston, Ross	Jones, Mrs Fiona (Newark)
Crausby, David	Jones, Ms Jenny (Wolverh'ton SW)
Cryer, Mrs Ann (Keighley)
Cunliffe, Lawrence	Jones, Jon Owen (Cardiff C)
Cunningham, Jim (Cov-try S)	Jones, Dr Lynne (Selly Oak)
Dalyell, Tam	Jones, Martyn (Clwyd S)
Darvill, Keith	Jowell, Rt Hon Ms Tessa
Davey, Valerie (Bristol W)	Kaufman, Rt Hon Gerald
Davidson, Ian	Keeble, Ms Sally
Davies, Rt Hon Denzil (Llanelli)	Keen, Alan (Feltham & Heston)
Davies, Geraint (Croydon C)	Keen, Ann (Brentford & Isleworth)
Dawson, Hilton	Kelly, Ms Ruth
Dean, Mrs Janet	Kemp, Fraser
Denham, John	Kennedy, Jane (Wavertree)
Dobbin, Jim	Khabra, Piara S

Kidney, David	Rammell, Bill
King, Andy (Rugby & Kenilworth)	Rapson,Syd
King, Ms Oona (Bethnal Green)	Reid, Rt Hon Dr John (Hamilton N)
Kingham, Ms Tess	Roche, Mrs Barbara
Kumar, Dr Ashok	Rooker, Jeff
Ladyman, Dr Stephen	Ross, Ernie (Dundee W)
Laxton, Bob	Roy, Frank
Lepper, David	Ruane, Chris
Leslie, Christopher	Ruddock, Joan
Levitt, Tom	Russell, Ms Christine (Chester)
Lewis, Ivan (Bury S)	Ryan, Ms Joan
Lewis, Terry (Worsley)	Sarwar, Mohammad
Linton, Martin	Savidge, Malcolm
Livingstone, Ken	Sawford, Phil
Lloyd, Tony (Manchester C)	Sedgemore, Brian
Lock, David	Shaw, Jonathan
Love, Andrew	Sheerman, Barry
McAvoy, Thomas	Sheldon, Rt Hon Robert
McCafferty, Ms Chris	Simpson, Alan (Nottingham S)
McCartney, Rt Hon Ian (Makerfield)	Singh, Marsha
	Skinner, Dennis
McDonagh, Siobhain	Smith, Rt Hon Andrew (Oxford E)
McDonnell, John	Smith, Angela (Basildon)
McGuire, Mrs Anne	Smith, Rt Hon Chris (Islington S)
McIsaac, Shona	Smith, Miss Geraldine (Morecambe & Lunesdale)
Mackinlay, Andrew
McNamara, Kevin	Smith, Jacqui (Redditch)
McNulty, Tony	Smith, John (Glamorgan)
Mactaggart, Fiona	Smith, Llew (Blaenau Gwent)
McWilliam, John	Snape, Peter
Mahon, Mrs Alice	Soley, Clive
Mallaber, Judy	Southworth, Ms Helen
Mandelson, Rt Hon Peter	Spellar, John
Marsden, Gordon (Blackpool S)	Squire, Ms Rachel
Marsden, Paul (Shrewsbury)	Starkey, Dr Phyllis
Marshall, David (Shettleston)	Steinberg, Gerry
Marshall, Jim (Leicester S)	Stevenson, George
Martlew, Eric	Stewart, David (Inverness E)
Maxton, John	Stewart, Ian (Eccles)
Meacher, Rt Hon Michael	Stinchcombe, Paul
Merron, Gillian	Stoate, Dr Howard
Michie, Bill (Shef'ld Heeley)	Stott, Roger
Miller, Andrew	Strang, Rt Hon Dr Gavin
Mitchell, Austin	Stringer, Graham
Moonie, Dr Lewis	Sutcliffe, Gerry
Moran, Ms Margaret	Taylor, Rt Hon Mrs Ann (Dewsbury)
Morgan, Ms Julie (Cardiff N)
Morley, Elliot	Taylor, David (NW Leics)
Morris, Ms Estelle (B'ham Yardley)	Temple—Morris, Peter
Mountford, Kali	Thomas, Gareth (Clwyd W)
Mullin, Chris	Thomas, Gareth R (Harrow W)
Murphy, Rt Hon Paul (Torfaen)	Timms, Stephen
Naysmith, Dr Doug	Tipping, Paddy
Norris, Dan	Todd, Mark
O'Brien, Bill (Normanton)	Touhig, Don
O'Brien, Mike (N Warks)	Trickett, Jon
O'Neill, Martin	Truswell, Paul
Organ, Mrs Diana	Turner, Dennis (Wolverh'ton SE)
Osborne, Ms Sandra	Turner, Dr Desmond (Kemptown)
Palmer, Dr Nick	Turner, Dr George (NW Norfolk)
Pearson, Ian	Twigg, Derek (Halton)
Pickthall, Colin	Twigg, Stephen (Enfield)
Pike, Peter L	Vis, Dr Rudi
Pollard, Kerry	Walley, Ms Joan
Pond, Chris	Ward, Ms Claire
Pope, Greg	Wareing, Robert N
Pound, Stephen	Watts, David
Powell, Sir Raymond	Whitehead, Dr Alan
Prentice, Ms Bridget (Lewisham E)	Wicks, Malcolm
Prentice, Gordon (Pendle)	Williams, Rt Hon Alan (Swansea W)
Primarolo, Dawn
Prosser, Gwyn	Williams, Alan W (E Carmarthen)
Purchase, Ken	Wills, Michael
Quin, Rt Hon Ms Joyce	Winnick, David
Quinn, Lawrie	Winterton, Ms Rosie (Doncaster C)
Radice, Giles	Wise, Audrey

Wood, Mike	Wyatt, Derek
Woolas, Phil
Worthington, Tony	Tellers for the Noes:
Wray, James	Mr. David Hanson and
Wright, Dr Tony (Cannock)	Mr. Jim Dowd.

Question accordingly negatived.

Question, That the proposed words be there added, put forthwith, pursuant to Standing Order No. 31 (Questions on amendments) and agreed to.

MR. DEPUTY SPEAKER forthwith declared the main Question, as amended, to be agreed to.

Resolved,

That this House recognises the importance of open markets between the EU and the US, notes that in genera] the trade relationship is a good one; acknowledges the work being undertaken by the Government in seeking a solution to the banana disputes in a way that is World Trade Organisation compatible and is helpful to British industry and to those countries economically dependent on exports of bananas; welcomes the Government's commitment to find a solution to issues concerning US food exports that is good for the consumer, respects scientific research and avoids protectionism; welcomes the Government's commitment to consider sustainable development issues in its approach to trade issues as well as the interest of developing countries; and endorses the Government's support for comprehensive trade negotiations to be launched at the World Trade Organisation Ministerial meeting in Seattle in late 1999.

Mr. David Maclean (Penrith and The Border)

On a point of order, Mr. Deputy Speaker. Have you received any request from the Home Secretary to make a statement on the extraordinary answer that he has given this afternoon on the Macpherson leak inquiry? As you know, the head of the Government's listening centre at GCHQ has been investigating the leak for two months. He concluded that the leak emanated from the Home Office, either from the Home Secretary, his Minister of State, their political advisers or a small number of civil servants. I think that we would all take the word of the Home Secretary, as an honourable man, that he did not do it. I do not believe for one moment that one of those few senior civil servants in the Home Office leaked it. We need a statement from the Home Secretary so that the House can question him about the involvement of the political advisers and his Minister of State and clear absolutely the few senior civil servants who are inadvertently fingered by this scandalous answer. I believe that the Home Secretary has today been making a statement on access to open government. The answer today is the biggest cover-up that we have seen.

Mr. Deputy Speaker (Mr. Michael J. Martin)

The right hon. Gentleman cannot use a point of order to make a speech. There has been no request from any Minister to make a statement. [Interruption.] Order. I can only state the facts as I have them. Perhaps the right hon. Gentleman's words will be noted by the Home Secretary.

Mr. Peter Bottomley (Worthing, West)

Further to that point of order, Mr. Deputy Speaker. Thank you for that ruling. It is a matter of record that the Home Secretary rightly made a statement on the Macpherson inquiry itself and rightly reported to the House when he interfered with the printing of The Sunday Telegraph when the leak was published. When the leak was clearly designed to destabilise the Commissioner of Police of the Metropolis,

for whom the Home Secretary is the police authority, it is not satisfactory for the matter to be left as it is. I hope that our words will reach the Government and that they will make a statement.

Mr. Eric Forth (Bromley and Chislehurst)

Further to that point of order, Mr. Deputy Speaker.

Mr. Deputy Speaker

Order. There is no further point of order because I have explained the situation. The hon. Member for Worthing, West (Mr. Bottomley) has not raised a point of order that I can deal with but made a comment. Points of order should not be used to make speeches.

Mr. Forth

rose—

Mr. Deputy Speaker

Order. I hope that this is a point of order.

Mr. Forth

On a point of order, Mr. Deputy Speaker. May I seek your guidance? I understand that matters of such importance can be difficult at this time of day. As the House is sitting tomorrow, can you confirm that hon. Members could seek for Ministers to come to the House tomorrow to give account of themselves, thus giving them more notice than we can today?

Mr. Deputy Speaker

The right hon. Gentleman knows as well as any hon. Member the opportunities for Back Benchers to make such requests.