§ Motion made, and Question proposed, That this House do now adjourn.—[Mrs. McGuire.]
§ 10 pm
§ Mr. Norman Baker (Lewes)I welcome the opportunity to raise the subject of the viability of the farming industry in East Sussex. It is important because of its direct employment of farmers and farm workers. It is also important to the rural economy of East Sussex and to the care of the countryside of which farmers are the custodians.
I regularly meet farmers from my constituency and will meet some on Friday. Over the past year, I have identified several worrying trends that the Government should address. They are aware of those trends, but I shall spell them out for the record.
First, the average age of farmers appears to be increasing. There is a shortage of new entrants to farming, and that is compounded by the fact that one traditional means of entry—county farms—was eliminated by the policies of the previous Government, which required county councils to offload those starter farmers. It was a foolish move and the effect has been regressive.
Secondly, reductions in the agricultural work force weaken the base of the whole community. Farmers who used to employ 10 or 20 people now employ two, one or none at all. They are surviving as best they can in the present circumstances. There has been a loss of tenant farms and a general increase in the size of farms in the county, and the situation is even worse elsewhere.
Thirdly, farmers have suffered significant—some might say catastrophic—reductions in income. Early last year, the National Farmers Union estimated that the real terms decline in farming incomes between 1996 and 1997 was in the order of 47 per cent. Even the Government's figures on total income from farming show a drop of 37 per cent. Not many people or industries could sustain such a drop in income during a single 12-month period.
In the past, it has been usual for one or another sector of the farming industry to suffer. At present, however, the problems are hitting all sectors together. Farmers have had nowhere to go to make up the lost income. The problems continue. According to figures from the Ministry of Agriculture, Fisheries and Food and from the Meat and Livestock Commission, a comparison of farmgate prices in October 1997 and 1998 shows the price of feed wheat down 13 per cent., lamb down 32 per cent., beef down 18 per cent., pigmeat—suffering particularly badly—down 41 per cent., milk down 12 per cent., eggs down 13 per cent. and broilers down 7 per cent. The catastrophe facing the industry continues.
Those reductions in farmgate prices are not always reflected in retail prices. I wrote at the end of last year to the four major supermarket chains to draw attention to the fact that their prices appeared not to be dropping although farmgate prices were. In the period 1987 to 1997, farmgate prices increased by around 6 per cent., but retail prices for food increased by about 35 per cent. Why should supermarkets have such a big mark-up that is not passed on to the farmers? In response, the supermarkets blamed a number of processor costs, for example hygiene inspections, and said that they now had to pay for parts 972 of animals that had been used previously, such as blood products, to be taken away. They blamed increasing transport costs.
I do not believe that those factors alone justify what appears to be an increased mark-up for supermarkets at the expense of the basic producers, the farmers. I should be grateful if the Minister would say in his reply whether he believes that there is an element of the cartel and profiteering in the behaviour of supermarkets, to the detriment of our farmers.
How can the Government help? I have a number of suggestions, to which I hope that the Minister will respond constructively. First, the beef ban must be lifted. I do not blame the Government at all for the ban. Since they have been in power, they have done their best to deal with a difficult situation and have made progress—credit, where credit is due. However, time is marching on and we are now a long way down the track. I hope that the Government will be able to give some sign tonight of when the ban will be lifted.
Secondly, there is a ban on beef on the bone. I speak as a vegetarian, but my analysis is that beef is perfectly safe. Even if it is not, people who wish to buy it should be able to do so and judge the risks for themselves. It is not for the Government to act as nanny state and to ban beef on the bone.
In Committee, I remember asking the Minister who is to reply, and who is responsible for food safety, whether he believed that beef on the bone was more dangerous than genetically modified foods, which are available in all our shops. He thought that that was a fair question. Perhaps he will elaborate on the subject tonight.
Also, I want some clarification from the Minister on a question that involves East Sussex county council. 1 understand that he may want to reply to me in writing on that matter. The National Farmers Union in my constituency naturally wants to ensure that, in schools and other establishments, the council serves beef that is subject to the same high health and hygiene regulations as British beef. The chief executive of the council has told the NFU that the council is precluded from doing so and from choosing British beef on legal grounds. I would be grateful if the Minister would clarify, tonight or subsequently, whether that is the case. Clearly, it is wrong and ludicrous if for regulatory reasons the county council cannot make a positive choice for British beef, which it no doubt believes—as do I—is subject to higher health and hygiene regulations.
Another problem is the addition of meat hygiene inspection charges. I welcome the Government's help to pay for the additional charges for a year; that is a welcome move. I and the right hon. Member for Wealden (Sir G. Johnson Smith), who is present tonight, have both been busy on that matter as regards the abattoir at Heathfield. However, paying the charges is a breathing space and not a solution.
I hope that the Government will produce measures to ensure that small abattoirs continue to exist. Any additional charges should be based on the throughput of an abattoir, not some flat-rate charge, which necessarily discriminates against the smaller abattoirs.
Small abattoirs are important. They are a link in the community. Wearing my animal welfare hat, I say that I want animals to be transported as little as possible between the point of production and their slaughter. 973 The Government say that they want that and that they want to avoid live exports, so why do they countenance the closure of smaller abattoirs, thus requiring animals to be transported over longer distances?
The Government could also do more to promote animal welfare-friendly produce and I hope that they will. In this country, our production is more animal welfare friendly than anywhere else in the world. It is important for the Government, first, to make it plain to the consumer where possible that produce from outside this country may not be produced according to the same high standards and, secondly, to promote and market British produce that is subject to high standards.
Certain labelling requirements may apply. The Minister is keen on labelling and rightly so, but is it not the case that processed products that come into this country do not have to be labelled with their country of origin? Fresh, entire products have to be, but processed products do not. Therefore the consumer could be misled. Goods of a lower standard can come in and masquerade as good-quality goods, undercutting high-quality British produce.
Does the Minister believe that, under World Trade Organisation rules, Britain can require high animal welfare standards or are we subject to the free trade extremism that we saw on bananas and that we may see—I hope not—on genetically modified organisms? What will the Government do to help promote UK produce produced to high animal welfare standards? I know that that is their intention, and I am sure that we share the same agenda on that, but they need to act on it.
Supermarkets have said that they are happy to buy products of a lower standard from overseas. A letter from Sainsburys of 18 November about chicken from Thailand stated:
The advantage for our customers of sourcing from Thailand is purely cost. The wafer-thin chicken delicatessen product and the frozen chicken pies and ready meals offer customers a cheaper alternative. By using chicken sourced from Thailand, our suppliers can enable us to offer customers with a smaller purse the opportunity of buying a product which they might otherwise have not been able to afford.Chicken from Thailand is produced in unacceptable conditions and undercuts higher animal welfare standards in this country.I want to raise some other matters briefly because 15 minutes goes by quickly in this Chamber. Will the Minister publish soon the Monopolies and Mergers Commission inquiry into Milk Marque? I understand that it has been sitting on the desk of the Secretary of State for Trade and Industry for two months, with all the resultant uncertainty for farmers.
Will the Minister say what he can about the position on common agricultural policy reform? I welcome the direction that the Government are taking to move it forward, but it is not enough. They need to do more to satisfy WTO rules and to take proper account of the environment. I hope that he will revisit the matter. Environmental measures on set-aside that would have allowed land to be permanently under wildlife were overruled in the negotiations. That is a step backwards.
East Sussex welcomes the environmentally sensitive area payments for the south downs. It is a good, successful scheme. The Minister of Agriculture must ensure that payments are not based only on profits forgone but include an incentive element to encourage participation.
974 The National Farmers Union believes that the organic farming scheme has been "a disappointment". Shaun Leavey of its south-east region writes:
The newly announced OFS has been a disappointment and militates against those who have been farming in an environmentally friendly way. Participants in Countryside Stewardship schemes and the ESA are treated for the purposes of the OFS as having unimproved land and so only qualify for the lower rate of grant. My phone has been red hot with complaints about this! In addition, there are unrealistic restrictions on the number of sheep out at keep (from other farms) that can be run on a farm participating in the scheme. Many complainants point out that they would have got a better deal under the old Organic Aid Scheme but were advised by MAFF staff to wait for the new scheme—they suspect (however unfairly) that this was MAFF's way of saving money.I know that the Government are committed to organic farming so I hope that the Minister can deal with that point.
§ Sir Geoffrey Johnson Smith (Wealden)I am glad that the hon. Gentleman has secured this debate. Having been a co-opted member of the East Sussex NFU for a great many years, I agree with all his points. He has not exaggerated and I am delighted to be associated with him this evening.
§ Mr. BakerI am grateful for those comments. Understandably, I agree entirely with my next-door neighbour.
There is great worry among local farmers about what genetically modified crops mean for them. I had a meeting with farmers at which that view was put forcefully. They do not want to be left standing in the middle when the music stops, as happened with BSE. They regard GM crops not as a future saviour, as Monsanto would have us believe, but as a threat, problem and nuisance. That is not to say that there are no potential benefits, but farmers have significant worries, including the liability issue. I hope that the Minister takes that on board.
The overarching problem is the strong pound, which disadvantages exports from the farming community, exacerbated by the crisis in the far east and Russia and the collapse of some of our export markets. I hope that the Minister will be able to answer my specific questions and that he will write to me in reply to those that he cannot answer tonight. The Government are trying to do their best for farmers in East Sussex and elsewhere, but there are significant problems that require the Government to move up a step in gear.
§ The Minister of State, Ministry of Agriculture, Fisheries and Food (Mr. Jeff Rooker)I shall do my best to respond to the questions put by the hon. Member for Lewes (Mr. Baker). I do not criticise him, because I greatly respect his activity and performances in the House, but he did not raise many specific issues in relation to East Sussex that I can address. He made many general points. He is a vociferous questioner of the Government—and that is quite right; I was too at one time. However, from my point of view, it means that, as the issues that he raised are less predictable, I cannot give him such a considered response from the Dispatch Box. I have come to the Chamber armed with briefings galore because I did not know, from such a general title, exactly which issues he intended to raise in the debate. I do not expect to 975 have anticipated all the questions—that might not be appropriate. However, if there are specific issues, it is much easier, and it is better for those constituents whom an hon. Member represents, to give a considered response.
Perhaps the hon. Member for Lewes could have phoned to say that he intended to refer to the viability of farming. It is no criticism, but he has asked me about 12 subject areas—all of which are general to farming, food and agriculture, and all of which are important. However, none of them is actually specific to East Sussex, so I cannot home in on the specific matters that affect the hon. Gentleman's constituency.
§ Sir Geoffrey Johnson SmithIn justice and fairness to the hon. Member for Lewes (Mr. Baker), he emphasised the increased regulatory costs that bear heavily on farmers in an area that is not prosperous in terms of the soil or the land that is farmed. Part of the land is designated as an area of outstanding natural beauty, which is a difficult problem for the farmers. The dairy industry suffers strongly from the attack that has been made on its relationship with Milk Marque, which the hon. Gentleman mentioned. Those matters are specific to the area.
§ Mr. RookerI could not say—by any stretch of the imagination—that East Sussex was not affected. However, the difficulty that I face is how we can offer advice and information on issues that are specific to East Sussex.
One of the first points mentioned by the hon. Member for Lewes was the decline in the labour force in East Sussex. Our records show that in 1993, 6,223 people in the total labour force worked in agriculture and that in 1997, that number was down to 5,588—a decline from 1.5 per cent. to 1.4 per cent. of the total in England
There is no doubt that the right hon. Member for Wealden (Sir G. Johnson Smith) and the hon. Member for Lewes represent an incredibly lovely part of the country. Much of it is designated as an area of outstanding natural beauty; of the 47 miles of coastline, a six-mile stretch is designated as heritage coast.
In relation to the make-up of the agricultural sector, there are more than 100,000 hectares of agricultural land—most of which is grassland. Crops take up 35,000 hectares; of those, 22,000 hectares are cereals, with the rest being split between oilseed rape, linseed and horticulture. Horticulture is quite small—potatoes are grown on only 185 hectares. Potatoes happen to be one of the successes at present; even with the strong pound, we are able to export them. The dairy herd in East Sussex is estimated to be about 16,000, but has gone down by a third over the past 10 years. The beef herd is 9,000; that has gone up by 80 per cent. during the past 10 years. The number of lambs and ewes is down slightly. Pig numbers have also suffered; they are down by 53 per cent. during the past 10 years. There are 660,000 poultry; that number has fallen by nearly 40 per cent. over the past 10 years. There are about 2,200 holdings in East Sussex, the largest number of which—800—are in cattle and sheep; 240 holdings are given over exclusively to cereals. Farm size is somewhat smaller than the UK average, with 1,700 holdings of less than 50 hectares. From those statistics, it can be seen that certain issues relating to East Sussex might naturally arise.
976 The hon. Member for Lewes mentioned the difference between farmgate prices and supermarket prices. I have heard similar remarks, justifying the practice and otherwise, from hon. Members on both sides of the House over the past 18 months and I suspect that there is more than a grain of truth in their comments. The hon. Gentleman has made certain suggestions and the Government are happy to receive suggestions, because we always want to do better.
The hon. Gentleman does not blame the Government for the beef ban and I am grateful for that; however, it is our job to get it lifted. We have made a modest start with the certified herd scheme in Northern Ireland, but the key is to get the date-based scheme accepted. The Commission inspectors came over in April, only three weeks ago, to carry out a full inspection of our facilities and system for operating a fairly complicated scheme. We await their report, and we have a verbal promise that it will come in 20 working days, which means that the report is imminent.
We are confident that we can satisfy the requirements of a date-based export scheme and we cannot wait to get the scheme in operation, so that the market, our farmers and the meat industry can start to export again. I hope that that will happen in the near future. If the Commission inspectors raise any matters, they will be addressed immediately, but we are quite confident that we shall be able to operate the scheme soon. As hon. Members will have seen in the press last week, there has been a slight hiccup—a technical difficulty with the Northern Ireland scheme. However, that issue would not arise under the date-based scheme, so there should be no knock-on effect.
The hon. Gentleman asked about the beef-on-the-bone ban, as he is entitled to do. I give him the same answer as I have given everyone else: we await the further inquiry and assessment of the chief medical officer, because we would be stupid not to act according to medical advice. As the hon. Gentleman said, the meat is safe: we have no evidence that there is any infectivity in the meat and we never have had such evidence, but that is not the issue with beef on the bone. The issue in that respect is the nervous tissue and dorsal root ganglia that remain after cooking, either on the bone or in the juices.
People have died, people are dying and, regrettably, more people will die, of new-variant CJD. There is a full-scale public inquiry going on, so I cannot comment further. We want both bans lifted as quickly as possible and we shall not hesitate to act, once we have received advice from the chief medical officer.
As I have hinted before, the over-30-months scheme ensures that no meat from cattle over 30 months goes into the human food chain, so the only possible route of transmission of BSE is maternal transmission. It takes nine months to produce a calf, and 39 months from August 1996—the date line for the feed ban—are up in November this year. It is easy to see that, after that date, there should be no possibility of risk from maternal transmission. As the scientists predicted, the reduction in the incidence of BSE has been dramatic because of the successful operation of the feed ban. The House will return to the issue again in the near future.
I apologise for being somewhat distracted at the start of the hon. Gentleman's remarks about British beef, but I shall certainly look into the matter and write to him. There should be no difficulty in anyone supplying British beef—
977 I do not agree with his arguments about people not being able to do one thing or another. The fact is that we have got the beef-labelling scheme going on a voluntary basis, and the last time I checked, 83 accredited organisations were operating the beef-labelling scheme. If someone wants to market or purchase beef under the beef-labelling scheme, which we encourage, there should be no difficulty. The claims made on the label are subject to independent verification, but there should be no argument about sourcing British beef for people in this country.
The consumption of British beef is increasing in this country. Since the beef-on-the-bone ban was introduced, consumption has increased from about 70 to almost 80 per cent. There should be no problems in that regard, but I shall consider the point raised by the hon. Gentleman and respond to him in writing.
Meat hygiene charges are a fairly hot issue, and I remind the hon. Gentleman that we will have Ministry of Agriculture, Fisheries and Food questions in a couple of days. We have promised to examine the specified risk material controls for another year and we have had another quick look at the ordinary Meat Hygiene Service charges. Some people have complained about the seven days of consultation. Let's face it: everyone has known for months that this issue must be considered annually. We want to take another quick look before we introduce the charges and we cannot do that retrospectively. MAFF is carrying the costs—some £300,000—at present, and we want to be fair.
Charging on the basis of throughput is a seductive idea. However, we are required to ensure that we collect the cost of operating the service. We can do that through the introduction of an hourly charge, but it would be very unfair to small abattoirs. Some 80 per cent. of cattle are slaughtered in 20 per cent. of this country's slaughterhouses: it is an unbalanced industry. There are a few huge slaughterhouses and big factories, and many very small slaughterhouses. Charging on the basis of throughput would be unfair to the big slaughterhouses which have made big investments, and charging via an hourly rate could be very expensive and would be unfair to the small producers. We are trying to find a third way—if I may put it like that—that is also consistent with our European Union obligations.
We have no plans to close small abattoirs. As I revealed in a recent debate, 600 small abattoirs have closed in the past 18 years, leaving about 350. Those closures were due not to policy, but to changes in the market.
978 The milk marketing inquiry is a matter for my right hon. Friend the Secretary of State for Trade and Industry. However, MAFF wants farmers and food producers to have greater control over the added value in the food chain. We are seeking co-operative and collaborative marketing. In that respect, this country is a failure compared with other countries where the producers have more control. Milk Marque—which is a big interest—is up, because of its operation, before the competitive authorities. I cannot comment on the details of that case, but we intend to push the industry down that path so that it acquires a greater share of the added value. It is not fair that a large share of the added value should go to non-producers.
I am not aware of the NFU's criticisms of our organic farming scheme. We have doubled assistance for organic farming and we wish to encourage it. It is easy for people to claim that we have not done enough and that we do not like organic farming, but the bottom line is that we have doubled the amount of taxpayers' money that we are spending to encourage farmers to convert to organic methods. We will subsidise not production, but the conversion to organic farming. As a matter of active policy, we have doubled the—albeit modest—MAFF research budget. My right hon. Friend the present Minister for the Cabinet Office made that announcement 18 months ago, and it was his second biggest priority after getting the beef ban lifted.
Of course, the assistance will never be enough. The scheme is so successful that MAFF's offices were inundated with inquiries last summer. We did not give false advice because we wanted to mislead farmers. Those who were thinking of converting under the old scheme instead of waiting for the new scheme received fair advice; we did not intend to put them at a disadvantage.
I agree entirely with the hon. Gentleman's comments about welfare-friendly produce. I wish that British people would pay more attention to this subject. The more effort we can put into marketing welfare-friendly produce, the better. We will offer all the support we can to ensure that the rules do not operate against British producers, and we will certainly follow up the promises that the supermarkets made last November regarding the pig industry.
I regret that I have not been able to cover all the points raised by the hon. Gentleman. These are important issues both for the hon. Gentleman and for other hon. Members who represent that part of the world, and I will do my best to write to the hon. Gentleman about any matters to which I have failed to respond tonight.
§ Question put and agreed to.
§ Adjourned accordingly at twenty-nine minutes past Ten o'clock.