§ Motion made, and Question proposed, That this House do now adjourn.—[Mr. Allen.]1.42 pm
§ Minister of Agriculture, Fisheries and Food (Mr. Nick Brown)
In little more than a week, agriculture has been the focus of two debates in the House. That is right. It demonstrates the importance that the House attaches to these matters.
Today, I want to set out how the Government are helping the industry to prepare for the future by providing special measures for the short term, and by providing a framework for an efficient, forward-looking and modernised industry for the longer term.
Before I deal with that, I shall say something about the French beef ban and the Government's response. As well as being a clear breach of European Union law, the French import ban has hindered the resumption of our beef exports. The Government have been, at both official and ministerial level, in regular contact with the European Commission and the French Government, to let them know just how seriously we take the matter and to bring the problem to a swift resolution.
The European Union Scientific Steering Committee is meeting today to consider France's evidence for its continued import ban. I have looked at the evidence, and it contains nothing not already known to us or to the Commission. I therefore expect the steering committee to dismiss the French evidence.
The Prime Minister has made it clear to the French Prime Minister this week that he expects nothing less than the immediate lifting of the ban on British beef, and I have made exactly the same thing clear to my counterpart as well. If the French fail to lift their ban, the Government will call upon the European Commission to take legal action at once.
We have made it clear that we have the science on our side, the law on our side and the Commission on our side. The French are isolated. We have played by the rules and fully expect to achieve the outcome that will benefit farmers and the entire beef industry.
§ Mr. Patrick McLoughlin (West Derbyshire)
I am grateful to the Minister for giving way. There have been press reports that the French Agriculture Minister has cancelled his meeting with the Minister. Is that meeting now to take place?
§ Mr. Brown
A routine bilateral meeting was arranged for Saturday which, I regret, the French Agriculture Minister has had to cancel because the French Prime Minister has asked him to accompany him on another overseas visit. [Interruption.] For Conservative Members to jeer at the French Government will not help. These are routine bilaterals, which often have to be rearranged at the last minute because of pressures on Ministers, and I take no offence at that. Our offices are in close contact.
The important contact between my office and others involved is not that with the French Government directly but that with the EU Commission. We should remember 1116 that France's quarrel is not directly with the UK—although, of course, we are the people most affected by it—but with the Commission. The French Government are defying an EU decision. The ban has already been lifted by 13 member states, a 14th, Germany, is in the process of doing so, and one member state, France, is not complying with what was a collective agreement.
§ Mr. Geoffrey Clifton-Brown (Cotswold)
Does not the Minister's reply to my hon. Friend the Member for West Derbyshire (Mr. McLoughlin) merely demonstrate the French Government's arrogance? They can have no more important problem than one involving the beef trade between two major EU countries. How much longer will the Government stand by and do nothing about a trade in beef fed with sewage—something that is illegal under European law—and about a ban on British beef that has nothing wrong with it and that the committee will not be able to find anything wrong with today? Will it take months or years in the European Court? What are our farmers supposed to do?
§ Mr. Brown
The hon. Gentleman is wrong. I can tell him from personal experience that Agriculture Ministers have to deal with many issues, some quite difficult, at the same time, so I make no complaint about the bilateral having to be rearranged. The hon. Gentleman asks what the British Government are doing. I have just set that out. The important next step is the meeting that is taking place today of the scientific advisers to the Commission, to which the French Government will respond and on which the Commission will then act.
§ Mr. Brown
The hon. Gentleman says months and months, but I say November. It is not right for the hon. Gentleman to say that the matter will drag on. We are looking for a speedy resolution and, after today's meeting, we expect the Commission to stand in our corner.
That brings me to the next matter to which I wanted to refer. We are similarly relying on the science and the law in respect of the use of sewage sludge in French animal feed.
§ Mr. Brown
Let me finish my point and then I shall give way.
I have received and published the clear and considered advice of the Joint Food Standards and Safety Group, advice which has been endorsed by the chairs of the three relevant independent advisory committees. The advice is that, althoughthe practice of adding sewage sludge to animal feed is repugnant to consumers and illegal under Community lawthere isno immediate public health risk and therefore no basis for seeking a ban of French products at either a Community level or unilaterally".Therefore it would be wrong, as well as illegal under EU law, to impose an import ban on French livestock products.
§ Mr. Brown
I intend to move on to discuss the other important issues that affect agriculture. If hon. Members 1117 wish to intervene on the French attitude to our beef exports and sewage sludge, I shall take interventions now, but not later, because the debate is scheduled to discuss the important but wider problems of EU agriculture.
§ Mr. John Burnett (Torridge and West Devon)
Did I understand the Minister to say that proceedings will be resolved by next month? If it is, what penalties does he envisage will be extracted from the French for breach?
§ Mr. Brown
We expect a speedy response from the Commission to the scientific evidence, and it is that that I expect in November. Of course I would prefer a quick and decisive outcome, but I do not want one that sets aside our clear rights in this matter. We have the right to offer our perfectly safe beef for sale in France.
§ Sir Peter Emery (East Devon)
One learns that it is the French intention to attend the meeting in Brussels and give way on the understanding that certain further restrictions are placed on British beef. If that is the case—it seems absolutely unreasonable to me—what steps are the Government preparing to take to deal with that problem?
§ Mr. Brown
Some people have been suggesting that I should ring the French Minister and cut a deal with him. I cannot do that. The date-based export scheme is a European Union scheme that has been agreed within the EU. The Commission is the custodian of it. It is not for me to enter into separate bilateral negotiations, nor can I. I am keeping very close to the Commission, and I had two long discussions with Commissioner Byrne yesterday. I am expecting to have further discussions either today or tomorrow, but I cannot go down the route that the right hon. Gentleman seems to be inviting me to take.
§ Mr. Charles Wardle (Bexhill and Battle)
Is not the Minister's assurance on sewage sludge, which he has repeated, dependent on it receiving adequate heat treatment? Can he tell the House that such treatment is being given? If it is not, his assurance means nothing.
§ Mr. Richard Burden (Birmingham, Northfield)
Is not the key point of the Government's position that we are acting in accordance with law and scientific advice? Would it not be the height of folly to act beyond, or in contravention of, scientific advice, as we are being urged 1118 to do by Conservative Members, and then expect the French to abide by the scientific advice that we want them to abide by?
§ Mr. William Thompson (West Tyrone)
Why did the Government allow the French to give new evidence to the Commission? Surely the French broke the law. The law is set out, so why is another member country allowed to open the whole issue up again and delay matters, as France is doing?
§ Mr. Brown
The French are in breach of the law. Their explanation is that they have new evidence. That claim has to be examined before it can be set to one side. That is happening now. I have looked at what they claim to be new evidence. There is nothing new there, and I confidently expect that to be the outcome of the scientific examination that is taking place today and tomorrow.
§ Mr. Ian Bruce (South Dorset)
I am most grateful to the Minister, who is being very courteous and answering questions directly. I congratulate him on his personal stand of not eating French food while the problem continues. That is very brave of him—perhaps braver than he expected.
If one of my farmers in Dorset decided to start feeding an animal sewage sludge and/or bonemeal and/or hormones, would the Minister's Department be able to prevent that tainted meat from getting into the food chain so that my constituents could not eat it? If it could do so, why can he not do the same to the French meat that is being produced in such a way?
§ Mr. Brown
We have strict controls in this country, most of which we want and some of which we have because of our special circumstances regarding BSE. In my extensive discussions with the industry, I have not met a farmer who wants to feed his livestock contaminated animal feed. British farmers want a premium in the marketplace for the quality-assured schemes that we operate. I think that the hon. Gentleman wants that as well, so I invite him to make common cause with me in supporting the Meat and Livestock Commission's assured British meat schemes.
§ Mr. John Greenway (Ryedale)
We all hope that the beef issue can be resolved quickly, but I bring the Minister back to the meat and bonemeal question. Surely if there is a meat and bonemeal ban for our own farmers, particularly in the pig and poultry sectors, the same should apply across the entire EU. The Minister shakes his head, but what is the justification for having the ban in Britain, but not in the rest of Europe? Does not the sewage sludge issue, which I first raised with the Prime Minister in June and which has come up again during the past few days, present a golden opportunity for imposing on the production of pork on the continent the same standards that we have in this country? Will the Minister think again about that? Whatever the president of the National Farmers Union says about a trade war, the pig and poultry farmers of this country want a ban on meat and bonemeal-fed products.
§ Mr. Brown
It is not a golden opportunity if it is not well founded in law, and the professional advice that I 1119 have received is very clear. As for the broader question of meat and bonemeal, the pig sector has a genuine grievance, with which I intend to deal later in my speech. I have something quite extensive to say, and I hope that the hon. Gentleman will bear with me until then.
§ Mr. Owen Paterson (North Shropshire)
I thank the Minister for giving way yet again. Does he realise that maintaining the ban on beef on the bone hopelessly undermines his negotiating stance in relation to the French? Backed up by idiotic Labour councils such as Coventry council, which has banned all beef products, it enabled the agricultural councillor at the French embassy, Mr. Jean-Jacques Benazit, to write to this week's edition of the Farmers Guardian invoking the precautionary principle because beef on the bone is banned in this country.
§ Mr. Brown
I shall have something to say about local authorities and beef later. As for a link between the ban on beef on the bone—which is at the extreme end of the precautionary measures in this country—and the date-based export scheme, no such link exists, because the date-based scheme relates to deboned beef. There is no question of any beef on the bone going into the export market through the scheme.
I can confirm again that I have received advice from the United Kingdom's chief medical officer, Professor Donaldson, that it would be safe to lift the ban for the purpose of retail sales, including sales through catering outlets. I have made it clear to the House repeatedly that I want to lift the ban as soon as I can, but I want to do so in an orderly way throughout the United Kingdom. That will require the consent of the devolved authorities that have competence in Scotland and Wales. I hope to be able to obtain their consent soon, and in any event before Christmas.
§ Mr. Letwin
I am grateful to the Minister, who has behaved with typical courtesy. Does he appreciate, however, that Conservative Members and many of our constituents are concerned with the timetable question? The Minister lifted our hearts when he spoke of November, but if what he is actually saying is that he has no means of protecting the industry against months, perhaps years, of legal wrangling, by the time that is resolved, many of our constituents will be out of agricultural production, and the nature of our countryside will have changed. Has the Minister nothing to say about dealing with that problem?
§ Mr. Brown
With the greatest of respect, let me say that I think that the hon. Gentleman is overstating his case. Our remedy is through the institutions of the European Union. After all, the date-based export scheme is their scheme, and that is the right approach for us to take. All 1120 the other suggestions—including the suggestion that we should initiate a trade war by behaving illegally ourselves—seem to me to be absolutely wrong. I think that they will cause much harm and misery to many people in this country as their jobs are put at risk—and hundreds of thousands of jobs are involved.
§ Mr. Jones
I thank the Minister for giving way. He has made some powerful comments, and I congratulate him on keeping his head during the crisis while many others have been losing theirs.
The Minister said that France was isolated. It is, within the European Union; but the United States of America is still imposing a ban on British beef. Is the Minister engaging in negotiations with the aim of getting the ban lifted in the United States? Which does he think will happen first, the French allowing in our meat or the Americans doing so?
§ Mr. Brown
I do not want to set time scales, or to put events in an artificial order. I have regular bilateral meetings with our friends in the United States and with officials at the United States embassy here, and of course those matters are much discussed. Let me, however, say gently to the hon. Gentleman that the United States has some grievances about beef trade issues in regard to the European Union, and naturally we discuss those matters as well.
I recognise, and I know that the House will recognise, the real difficulties faced by agriculture and the wider rural economy as a result of the depressed level of farm incomes. In recent years, there has been a dramatic fall in those incomes, which has affected the whole industry but which is felt particularly in the livestock sector.
The reasons for the fall in farm incomes are well known: the strength of the pound; the implications of the BSE crisis for the beef sector, and BSE-related controls that have impacted on the whole of the livestock sector; and the loss of overseas markets with recession in the far east and collapse of the Russian economy.
As for the Government's response, we believe that there is a good case for a common agricultural policy in the European single market. However, as currently structured, the common agricultural policy does not serve our agriculture well. The Government's policy is to secure a more competitive and sustainable industry with a stronger market orientation. We want to reduce agriculture's reliance on subsidies based on production. We also want to encourage restructuring for long-term sustainability, and to promote development of real markets for our products, less distorted by the CAP. That was the philosophy behind the United Kingdom's support for the Agenda 2000 reform proposals.
The House should not underestimate the fact that the Agenda 2000 agreement represents an important step in moving the common agricultural policy in the right direction. The changes will help agriculture to meet the challenges of further trade liberalisation, including our ambitions for European Union enlargement and the upcoming World Trade Organisation round. A significant shift from price support to direct payments was agreed, and will reduce the economic distortions of the common agricultural policy.
We have also created an integrated European Union rural development policy. For the first time, measures for agri-environmental schemes, early retirement, marketing 1121 and energy crops are providing within the CAP the basis for a welcome shift in emphasis, from production support to future environmental and rural economy measures.
§ Miss Anne McIntosh (Vale of York)
Within the framework of the CAP, and as trade barriers are lifted, does the Minister accept that meat hygiene charges are an additional burden for our farmers and a factor in making them less competitive? Other hon. Members have already mentioned the United States model of farming. In recognition of the public safety aspect of meat hygiene, the United States Government pays meat hygiene charges, which amount to $800 million annually. Might the United Kingdom Government be minded to go down that route, and recognise that, as a public safety measure, meat hygiene should be a charge on the public purse?
§ Mr. Brown
The Government cannot fully go down that route as, like other European Union members, we are obliged to recover some of the costs from the industry. However, some issues are unique to the United Kingdom, such as the recently created BSE safeguards. I shall say something about those issues in a moment. We are also looking very hard at the operation of the Meat Hygiene Service, about which I shall also have something to say. Although the hon. Lady is on to a very strong point, the answer is in the detail. It is not possible for me or for any Minister to waive all the charges.
§ Sir Geoffrey Johnson Smith (Wealden)
Does that mean that there is no question of compensation being offered? I ask that because, as we know, the United Kingdom egg industry is subject to much closer and more rigorous examination than the egg industry of any other western European country. When a flock ceases being productive, for example, all the cages must be replaced, and that is a very expensive proposition. Bearing in mind the extra burden borne by the United Kingdom egg production industry, is the right hon. Gentleman telling us that there is no question of compensation to help them overcome that additional cost, so that we may at least be assured of a good supply of healthy eggs? I recall that, when it came to grubbing out apple orchards, there was some compensation for apple growers.
§ Mr. Brown
The right hon. Gentleman is quite right to talk about the difficulties of the egg and the poultry meat sector. As he will know, the European Union regime for both the poultry and the pig sector is a light one—in other words, it does not provide any avenue for specific support payments of the type that he described. It also—this is perhaps less well understood, but is right—prevents member states from introducing new egg regimes of their own. I shall say something later about how we should deal with those circumstances. Nevertheless, the right hon. Gentleman is on to a good point, which he raises at the right time. There is no question but that the sector is going through very difficult times.
§ Mr. Cynog Dafis (Ceredigion)
The Minister mentioned energy crops and I have made the point before that there is an anomaly in the situation in which arable area payments can be converted into support payments for energy crops, but livestock payments cannot. That is 1122 discriminatory between sectors, and also between regions and parts of the UK. Is not that wrong; will he undertake to put it right; and how long will it take?
§ Mr. Brown
I cannot give an undertaking to reshape the schemes to meet the anomaly that the hon. Gentleman points out, but I am an enthusiastic supporter of energy crop production in this country. It has great potential and I shall do what I properly can to help. The rural development announcements are only weeks away and they will offer a potential way forward.
Agenda 2000 provides member states with discretion on how to implement aspects of the CAP reform agreement. That was the subject of my recent consultation. I invited views from everyone with an interest in the countryside on using the options available under Agenda 2000 to achieve a competitive, flexible and diverse industry. I am in discussions with the Treasury about the long-term future of support for agriculture in the UK in the light of the sustained problems that our farmers have been facing.
The problems that UK farmers face are problems for the whole food chain. As Minister with responsibility for both agriculture and food, I have from the outset been keen to bring together all parts of the food chain to address common problems. The different parts of the industry have much to learn from each other. The food chain group, which I set up, will report soon and I hope that its report will engender not only discussion but action—in a spirit of partnership—to address some of the issues facing the whole food chain. I am grateful for the help that has been given to that important initiative by retailers.
§ Mrs. Gwyneth Dunwoody (Crewe and Nantwich)
Will my right hon. Friend the Minister please emphasise the extraordinary area of dispute caused by the appalling prices paid to the producer—who must be important in all this—by supermarkets which seem to make large profits in the middle? While those talks are taking place, would it not be a good time to point out to the distribution system that it might be nice if the housewife and the producer benefited from a more sensible system?
§ Mr. Brown
I am very keen on getting all parts of the industry—the retailers, the distributors, the processors and the producers—to realise that they have interests in common. I am also opposed to the improper exercise of market power to enable the strong to prevail against the less strong. The Competition Commission is now considering the issues, which include the profit margins of the retailers, their relationship with consumers, and the working of the entire supply chain. We will have to await its report, which will of course be made to my right hon. Friend the Secretary of State for Trade and Industry.
I welcome the initiatives that have taken place, although more has to be done. The Government recognise that special short-term measures are needed—exceptionally—because of the current pressures. That is why I announced on 20 September extra support to hill livestock producers in recognition of the particular difficulties that they face. Some £60 million extra will be made available in 1999 and a further £60 million in hill livestock compensatory allowance payments in 2000. 1123 The payments under Agenda 2000, from 2001, will be made on a different basis, and I expect to issue a consultation paper on that next week.
§ Mr. Tim Collins (Westmorland and Lonsdale)
I hope that the Minister will be able to answer a specific point put to me in the past half hour by a representative of the Cumbrian NFU. It is rumoured that the consultation that the Minister has just mentioned will close on 19 November, but the paper will go out next week. Is that true, and if so, will it be possible to extend the consultation period, so that hill farmers in grave difficulty have more time to think about the serious implications of the change?
§ Mr. Brown
That is a fair point, but I want to reflect on it over the next 24 hours as I do not want unduly to delay making the payments. The longer the time allowed for consultation, the later the new scheme will be introduced. Both those factors must be borne in mind. There has been some discussion with farmers' representatives already, but the hon. Gentleman raises a fair point and I promise to give the House an answer within 24 hours.
In the same package, I announced the deferral of charges for inspections of specified risk material from cattle and sheep carcases until the year 2002–03, at least. That in part answers a point raised earlier by the hon. Member for Tiverton and Honiton (Mrs. Browning). In the present depressed state of the market, and given that those costs do not fall on our competitors, it is right for the Government to continue to meet the charges from public funds. Similarly, and for the same reason, I announced that the charging of farmers for cattle passports would be deferred at least until 2002–03.
The Government also have an important part to play in setting the right regulatory framework—for both the farming industry and the wider public—and in recognising the burdens that legislation imposes. I shall do all I can to relieve farmers of unnecessary bureaucracy. We have already implemented, as far as we can, the efficiency study on reducing paperwork burdens on farmers. We already seek to help farmers by pre-printing forms, for example, and we are trialling the use of electronic communication.
However, we must do more. That is why we have set in hand a review of the regulatory burdens. Also, to ensure that we tackle the matters that the industry considers to be unnecessary or oppressive, I have asked the industry to tell me of its top concerns. I have asked teams of informed individuals to look radically at the priorities chosen by the industry. Those priorities cover slaughterhouse regulation—another point rightly raised by the hon. Member for Tiverton and Honiton—meat hygiene rules, integrated administration and control system and inspections and the workings of the intervention system.
I have asked the different working groups to advise me of ways in which we could do things better. That is not the end of the story: other matters remain to be examined.
§ Mr. Paterson
What has the Minister done since last weekend's revelation that the Meat Hygiene Service, from the £40 that it charges an abattoir, gives £8 to a vet, takes £8 for administration fees, and gives £24 to private contracting companies such as Eville and Jones of Leeds?
§ Mr. Brown
That is precisely the type of issue that the review body is examining. However, for completeness I should tell the House that, in addition to the review body that I have appointed, the Meat Hygiene Service has also implemented an efficiency exercise. The outcome of that exercise will be reported to the main review body.
§ Mr. Clifton-Brown
Will the Minister ask the review body to examine a specific problem that has irritated a number of my constituents? That is that simple administrative errors—on IACS forms, for example—can result in huge and disproportionate penalties.
§ Mr. Brown
At present, I seem to be the review body, as hon. Members set out hard cases. As far as I can, I look very closely at such cases, as some of them seem hard to me as well. Although the European rules that constrain us are very tight, the hon. Gentleman makes a good point; I have seen some cases that I think are very hard, and there clearly would be justification in having another system to check that we were not being harder than the rules required. However, the scope for ministerial discretion is very limited.
§ Mr. Duncan
Farmers in my constituency try to export sheep carcases to France. That is a lucrative market when it works, but the Government requirement that the spinal column be removed does not suit the sale of such carcases. If that simple and unnecessary stipulation were relaxed or rescinded, the French market would be opened up again. That would benefit my farmers, who want only to trade sensibly. Will the Minister undertake to change the rule, as there now seems to be no need for the requirement on safety grounds, and its removal would make all the difference?
§ Mr. Brown
I can give the hon. Gentleman an assurance that I am looking very hard at that matter. However, the constraint is a recommendation from the Spongiform Encephalopathy Advisory Committee and the Government cannot lightly put it to one side. I am examining the matter closely, but I cannot give the hon. Gentleman the assurance that he seeks today.
§ Mr. Brown
I take the review process very seriously indeed. It is a joint initiative undertaken by myself and Ben Gill, the president of the National Farmers Union. 1125 A range of industry interests are involved in it. I have participants to report to me crisply, and where I can I intend to act as soon as possible.
§ Mr. Mark Todd (South Derbyshire)
Will my right hon. Friend ensure that there is an international dimension to the review? That would allow us to be aware of the performance of our competitors in ensuring that regulations are complied with, and to know the compliance costs that they commit to that exercise.
§ Mr. Brown
I have asked our agricultural attachés in the European Union to look at what is done in other member states. I know that the Meat and Livestock Commission has also looked at the matter closely. Both sets of information are in the public domain, and the hon. Member for Tiverton and Honiton referred earlier to what happened in the United States. It is right to compare our performance with that of other countries, but such comparisons serve to show that we have an incredibly good tale to tell about our domestic safeguards and our industry. I think that that tale should be told more loudly.
The initiatives to which I have referred are being undertaken over the next few weeks. I am also seeking the help of other Departments, where the concerns about unnecessary bureaucracy arise in relation to non-agricultural policies. If we can do things in a better way without endangering consumers, the environment or taxpayers' money, we will. I assure the House that, if I have to make a case for changes in law in Brussels, I will do so.
I still believe that more needs to be done. The way forward lies not in devising schemes that supplement the supply-side measures of the CAP, but in doing more work on the demand side. We must develop distinctive brands of British farm produce that meet the needs of consumers and command a premium in the market place. Yesterday, I attended the National Farmers Union's event celebrating great British food. I welcome the work that the NFU is doing in partnership with elements of the supply chain, including processors and retailers. I support the idea of a British produce kitemark. We have a good story to tell, and the pig industry provides a good example of that.
§ Mr. Ieuan Wyn Jones (Ynys Môn)
I thank the Minister for his patience in the debate. He has given way many times, and hon. Members of all parties appreciate that. In September, he announced a tranche of aid for private storage for lambs, applicable in October. If another tranche were made available for November, it might not have a dramatic effect but it would offer some help to the industry. Will the Minister say whether the Government are likely to apply for another tranche of that aid for November?
§ Mr. Brown
To aid the upland industry, which was in crisis, I raised HLCAs by £60 million. I recall saying that last year's increase was a one-off, and I am obliged to say that this year's is as well. The hon. Gentleman is right to 1126 say that a very small amount of money is still available for intervention, but I cannot promise the House that I will be able to draw it down.
§ Mr. Brown
I would like to make some progress on the pig sector, which has a particular call on our support.
The British public urged Members to pass legislation outlawing stall-and-tether production systems in pig farms on animal welfare grounds. We have high health and hygiene standards, and other clear quality advantages. Not surprisingly, many people recognise that and want to buy British. Consumers should be able to do so and should not be misled by labelling.
I am particularly concerned at the development of products with labels that have British-sounding names, but which market imported pigmeat. I am determined to tackle the issue of misleading labels, and yesterday put out for consultation new, strengthened guidance to trading standards officers to act on cases of misleading British brand names or geographic associations given to imported produce.
§ Mr. Brown
I should like to set out my objectives, but, given the hon. Gentleman's long-standing interest in these matters, I shall of course give way to him later. He may wish to hear in full what I propose before he intervenes to accuse me of not doing what I am about to announce.
I have three objectives. I want to give clear, unambiguous information on the real place of origin, not place of processing or place of slicing; I want to clamp down on misleading place of origin descriptions; and I want to make further progress by lobbying the European Commission and other member states for a system of clear country of origin labelling. I am seeking to have this issue raised in the Codex committee on food labelling because of the international nature of these arrangements.
Although a clampdown on misleading labelling would help, the pig sector requires further assistance. I have written to Commissioner Fischler formally requesting the reopening of aids for private storage for pigmeat as well as the restoration of export refunds. It is also my intention to see what can be done about the additional costs on the industry arising from BSE-related public safeguards.
§ Mr. Brown
That matter was raised, perfectly properly, earlier in the debate, but I should like to finish my point before taking interventions.
As it stands, there is a complete ban on commercial uses of pig meat and bonemeal, which was formerly sold for use in animal feeds. The ban is in place because SEAC recommended it. I agree with SEAC—the Government's advisers on this issue—that same-species recycling is wrong. It is a positive advantage for the UK pig sector that it does not recycle.
1127 SEAC also has justified concerns about the risks of cross-contamination and fraud if the Government were to permit the use of pig meat and bonemeal in the feed of other farm animals. I want to re-examine that issue with SEAC to see if there is any way that pig farmers can get a commercial return on their meat and bonemeal, while retaining a high level of public protection.
Earlier this year, I received assurances from retail chains that they would be sourcing British pigmeat. I want to reaffirm those commitments. Because of the grave difficulties facing the sector, I have appointed an official in my Ministry—Mike Roper—to serve as designated co-ordinator for all the efforts that my Department is making with respect to the pig sector. That will include making progress in the Ministry's pigmeat verification efforts to ensure that retail and catering suppliers are playing fair. Mr. Roper will report directly to Ministers.
I have had three meetings with representatives of the pig industry this month. I attended the Meat and Livestock Commission's British pig executive meeting this month, and will attend next month's meeting. I strongly support the MLC's British pork mark, but there is need for a renewed effort.
Members of Parliament have a particular responsibility. That is not a party political point as we also have an equal responsibility. We voted for higher welfare standards, and the higher costs that go with them. If times were good, the industry could bear the costs, but times are not good. That is why we have a special responsibility. I have written to all English major public purchasers—local education authorities, health authorities and prison wardens—to draw their attention to the high quality, hygiene and welfare standards of British pork products. My Scottish and Welsh counterparts are doing the same, as is Lord Dubs in Northern Ireland. I have also written to each Member of Parliament. I call on all Members to follow up that initiative—part of the broad campaign through which I am slowly taking us—with their local authorities, health authorities and prisons. If they receive a letter from me and the local Member of Parliament—none of us is without influence in our constituencies—there may be a real impact. I urge the House to treat my initiative in the bipartisan spirit in which I offer it. All of us can do something to help the pig sector.
§ Mr. Brown
I have more to say, and I must ask the hon. Gentleman and the right hon. Gentleman to wait until I have finished my announcements.
I have also written to all LEAs about beef, emphasising the quality and safety of British beef. Last week, I met an all-party delegation of Northern Ireland representatives—including the hon. Member for West Tyrone (Mr. Thompson), who is present, and his hon. Friend the hon. Member for North Antrim (Rev. Ian Paisley); I hope that I can describe the latter hon. Gentleman as the other's hon. Friend. [Interruption.] I am never quite sure. The delegation met my noble Friend Lord Dubs to hear about the particular problems facing agriculture—notably the pig sector—in Northern Ireland.
I am keen to strengthen the marketing skills of British farming and to provide much needed assistance to the pig industry. I announced in September that £1 million would 1128 be made available for that purpose, but, in view of the severe continuing crisis in some sectors, the Government are making available an additional £5 million in marketing aid. I am aware of how acute the position of the pig sector is, particularly in those parts of England and Northern Ireland where the industry is concentrated. I intend the pig sector to have a first call on that new money, and I hope that it will help to strengthen the sector's competitive position in future.
§ Mr. Gill
I have listened carefully to what the Minister has said about labelling, as I did when he addressed the National Farmers Union's great British food conference yesterday morning. Does he regret that while the House has the power to make legislation on animal welfare, we cannot legislate to make it mandatory for all producers to label British products as produced in this country? What does he intend to do about that? I see him going into a minefield as he tries to legislate in other ways that would avoid stating so categorically that a product was made and produced in Britain.
§ Mr. Brown
If the hon. Gentleman reads the statement that I have issued, which I am happy to make publicly available, he will find that I am trying to tiptoe through that minefield. I support the MLC-assured British labels, which give quality assurance. I support the NFU's idea of a kitemark. I am clamping down on misleading labelling, including on pictures or even product titles that imply that a product is British when it is not. Guidelines have been issued to trading standards officers and it is up to them to enforce the law through the courts. Tightening the guidelines to trading standards officers shows the Government's clear intention to ensure that consumers are not misled.
§ Mr. Curry
When the right hon. Gentleman has finished his personal boycott and can once again set foot in a Carrefour supermarket in France, will he look at the beef on sale and notice that it is all labelled "né, elevé et abattu en France"—born, reared and slaughtered in France? Would not that be a good model for British labelling? Is it legal?
§ Mr. Hayes
When the right hon. Gentleman considers labelling, will he take into account the wholesale, catering and processing industries, among others, as well as the retail industry, which are consuming more and more pigmeat and should be brought into the examination? It is one thing if people buy pigmeat for themselves from the shops, but if they are consuming it in another context it is difficult for them to ascertain its origins. As the right hon. Gentleman knows, the Select Committee on Agriculture looked into those matters and those industries are the growth sectors for the purchase of pigmeat.
Secondly, when the right hon. Gentleman looks into marketing, will he consider the fiscal regimes that are faced by farmers? It is not merely pig but arable farmers who are in desperate straits. In many competitor countries, 1129 the fiscal regimes and hidden subsidies offered make it easy for farmers to borrow and to invest in marketing and other areas of business expansion.
§ Mr. Brown
On the second range of issues, if we believe that the European Commission ought to look into some matter, we draw it to its attention and it acts on our requests. On the catering sector, the hon. Gentleman is right—almost one third of all UK food is now consumed through catering outlets rather than retail sales and preparation at home. I will pay particular attention to catering in the continuing talks that I am having with the industry—the retail and catering sectors and those who supply caterers. The hon. Gentleman, although perhaps for these purposes I may call him my hon. Friend, is on to a good point and I hope that my verification officer will also be able to pay particular attention to that area.
§ Mr. Tom King (Bridgwater)
I think that the right hon. Gentleman has completed the pig package that he trailed in the House last week, when he said that he would have something substantial to say. What forecast have his officials given him of the likely value to the industry of the measures that he has announced today? I told pig producers in my constituency that an important package was coming. The background there is that they are on a deadline and I think that substantial producers are about to shut down. If this is the total package, we are on the brink of a major collapse of the pig industry. What is plan B? Other countries would have such a plan and would not allow their industries to go like this. Among other things, the collapse of the sector would be a huge setback for welfare in the pig industry.
§ Mr. Brown
I entirely agree about the setback for animal welfare if we lose a significant part of the industry. As the right hon. Gentleman knows, I am constrained by the state aid rules. I am trying to do everything that I can within the rules and the law, but we will get those in our domestic industry through only if we get them that premium in the marketplace for the quality product that they produce. That is the only way forward. We have to get consumers on our side. We need to market our way out of the problem. I cannot invent supply-side measures to supplement the common agricultural policy because that would not be lawful.
I have no forecast of the impact of these measures, but I appeal to every hon. Member to try his or her best, as I am trying my best, to get the industry through.
§ Mr. Robert Key (Salisbury)
We must also get the supermarkets on side. Will the Minister explain a little more about the interface in competition policy between his Department and the Department of Trade and Industry, with so many of our pig farmers in particular on the brink of bankruptcy? Supermarkets are in a positive frame of mind, but they have to a large extent been responsible for the type of agricultural production on which they have insisted from farmers in the name of the consumer. They underestimate their role in creating a demand for different products. If we want to create a better value product for 1130 British farmers to sell, supermarkets must abandon their lowest-cost production technique and start to market British produce at a fair price.
§ Mr. Brown
That is exactly why we are making extra public money available to encourage marketing and the explanation of the specific benefits—welfare benefits and quality—that sit alongside the domestic industry. I hope that retailers will be willing to help. We have a good story to tell and it is one that the public wanted us to tell. We should say so loud and clear. The Government have a responsibility, but there is also a responsibility on each and every one of us as individuals.
§ Mr. Paul Tyler (North Cornwall)
I congratulate the Minister on this new form of Question Time that he is instituting. Seriously, does he accept that there has to be a plan B, as the right hon. Member for Bridgwater (Mr. King) said? It will not be enough to market or label our way out of the pig crisis as it is far too deep for that—it is an emergency and one that none of us has experienced before. I suggest that the right hon. Gentleman reads carefully the Hansard report of the debate to which his right hon. Friend the Minister of State, the Member for Gateshead, East and Washington, West (Ms Quin) replied yesterday, when a number of hon. Members put specific questions. At one meeting with sector representatives on 5 October, he said that there was a real chance not merely of Government but of European Union funding in particular circumstances when public health was at risk. That is the situation that faces the pig sector because the BSE spillover into the sector has caused it huge additional costs. That is the principal reason why pig farmers in my constituency and in many others that are represented here today are going to the wall as the right hon. Gentleman speaks.
§ Mr. Brown
I want to do everything that I can to help and I will not close any door until it is shut so firmly that even I cannot open it again. However, I must not hold out the prospect of hope where that does not exist. Any state help to the industry would almost certainly be struck down by the EU as an unlawful state aid.
§ Mr. James Paice (South-East Cambridgeshire)
Will the right hon. Gentleman explain the difference between paying public compensation for specified offal removal in pig abattoirs, which costs about £5 per pig and is done on a public health basis, and the compensation that Belgian farmers got for the dioxin crisis?
§ Mr. Brown
That is not the cost, but the MLC estimate of everything involved in the new meat and bonemeal 1131 constraints that were put on the industry in 1996. The position in Belgium is different because there was a specific public health crisis that related to dioxin. That is not the case in the United Kingdom. No public health issue is involved. Essentially, the issue is one of markets. Even if I could get the money, which would be extraordinarily difficult, if I tried to introduce some new supply-side package of assistance it would be struck down under the state aid rules. That is the answer to the question.
§ Mr. Alasdair Morgan (Galloway and Upper Nithsdale)
When negotiating country of origin labelling, will the right hon. Gentleman take a flexible view of the meaning of the word "country"? I can think of several quality exports from the Scottish agriculture sector, such as beef—and whisky, which is basically an agricultural product—whose producers and manufacturers would not necessarily think it to their advantage if they were forced to label them as the produce of the United Kingdom.
§ Mr. Brown
I mean this kindly—I think that we have a good regional food story to tell as well. The component parts of the United Kingdom—the regions of England as well as Scotland, Wales and Northern Ireland—can all tell their own tales. I want the industry to make more use of the EU regional food description rules, so that we can boast about the things that we do well. The hon. Gentleman has a fair point.
Now, I want to make progress as I have more to say and I know that the House will be interested to know that the Government are also making available an additional £10 million for organic farming. This Government have been a strong supporter of the organic movement. We have already more than doubled support for conversion since we came to office as well as providing £2.2 million this year for organic research and development. We have found demand among farmers for conversion very strong indeed—so strong that the organic farming scheme became oversubscribed. I want this new money to help to clear the backlog of applicants waiting for conversion aid. As hon. Members will already know, the Government are conducting, with representatives of the organic sector, a review of the organic farming scheme to establish how best the Government might continue their support for farmers wishing to move into organic production methods. In the meantime, I can announce the extra £10 million.
On 7 July, I announced to the House that we were consulting milk producers in England, Wales and Scotland about extending the remit of the Milk Development Council. I can today announce the result of that consultation. A substantial majority of producers who voted favoured extending the council's remit to cover the generic promotion of liquid milk. There was also strong support from the farming unions and the dairy trade. The dairy sector as a whole has chosen to spend around £10 million on an 18-month promotion campaign. I welcome this initiative and, therefore, intend to propose the necessary changes to the legislation, once we have agreed the detailed arrangements with the dairy processing industry for it to provide matched funding. I am placing the full results of the consultation exercise in the Library of the House.
I have described a very difficult set of circumstances facing the industry. Understandably, the main public focus at the moment is on beef exports. Although it is clear that 1132 the Government must pursue that and ensure that there is free trade under European Union rules, a solution will not solve the problems of agriculture. These are deep seated. I have described a measured, realistic, Government response to the crisis. I commend it to the House.
§ Mr. Tim Yeo (South Suffolk)
It is only eight days since the House last debated agriculture—eight days in which much has happened and much has not happened. I welcome the debate. It is the first in Government time since either the Minister or I have been in our posts. I congratulate him on his speech. I want to be as positive as I can and, certainly, I welcome a number of aspects warmly.
In essence, however, today's speech is the same speech that the Minister has made to the House half a dozen times during the past year: he is sympathetic, extremely courteous and quite understanding. We get warm words in abundance, but tangible action remains, even today, scarce. He touched on a number of long-term issues that I want to follow up because great uncertainty surrounds the future of British agriculture.
Contrary to the Minister's claim on 11 March that he negotiated:The most radical reform of the Common Agricultural Policy since its inception",the reforms were so limited in their scope that the issues will certainly have to be revisited before European Union enlargement takes place, and they may barely survive the forthcoming World Trade Organisation round.
There are other issues, such as the pace of consolidation within British agriculture, the balance of power between farmers and retailers, the shift of taxpayer support away from production-related payments, and the role of farmers in looking after the environment and the countryside. Unfortunately, it is not possible to explore these important long-term themes today because British farming is engulfed in a short-term crisis. In the time available, I want to concentrate on some of the short-term issues that will determine how many British farmers survive in business long enough to be around the next time that the Government decide to call a debate on agriculture in Government time.
One such issue is labelling. I welcome the Minister's announcement of proposed new guidance, but I regret that it has taken a long time to appear. The issue has been raised in every agriculture debate in which I have taken part in the past year. The Conservative party has been calling for honesty in labelling for the whole of that time and, indeed, longer. [Interruption.] I was sure when I made that point that it would produce exactly the reaction that it did. Hon. Members intervene from a sedentary position and I name the hon. Member for Waveney (Mr. Blizzard), who never attends one of these debates without displaying his appalling ignorance of the facts of farming life. Such interventions simply underline how little the Labour party understands what is going on in the countryside. If there were a single farmer whom I had met in the past year who would say that he would rather be where he is today than where he was three years ago, 1133 I would be delighted. I challenge those who mock what I am saying about the urgent need for honesty in labelling to find such a farmer.
§ Mr. Alan W. Williams (East Carmarthen and Dinefwr)
Will the hon. Gentleman remind us who, in a minority of one in the European Commission, opposed the labelling of food containing genetically modified food?
§ Mr. Yeo
There is an old saying: when in a hole, stop digging. The hon. Gentleman has simply reinforced my point. He fails to recognise that agriculture today is in a state of acute crisis. One way of improving matters—for once, without resorting to the Treasury because no taxpayers' money would be involved—would be to introduce honesty in labelling, which we have been calling for, as agricultural incomes have slumped month after month. Although I welcome the guidance that the Minister issued yesterday, it is a pity that it has taken so long to come.
§ Mr. Bob Blizzard (Waveney)
Will the hon. Gentleman give an honest answer to this question: is he or is he not advocating that this Government break the law by imposing a ban on the importation of French meat? If he were a Minister, would he perform that illegal act?
§ Mr. Yeo
I shall deal with that subject in detail later in my speech.
When the Parliamentary Secretary replies to the debate, I hope that he will explain to the House the status of the guidance on labelling, what sanctions are available against those who do not follow it, whether the Government have support for their proposal from retailers and food manufacturers—given that this is not a new issue, I am sure that there has been discussion about it—and when the guidance is likely to be introduced.
§ Dr. Nick Palmer (Broxtowe)
Will the hon. Gentleman explain the difficulties that prevented honesty in labelling from being introduced at any time during the past 20 years? He said that he had campaigned for it for several years.
§ Mr. Yeo
Even the Minister understands the difference. As recently as this time last year, British pig farmers were not required to rear their pigs to standards not required of pig farmers abroad. That changed circumstance alone, effective from 1 January 1999, is an overwhelming reason for what we have been calling for. Oddly enough, even the Minister would accept that.
§ Mr. Ian Cawsey (Brigg and Goole)
Is the hon. Gentleman admitting that when his Government were in power they did not understand that their legislation would have such an impact?
§ Mr. Yeo
One of those who recognised the point was my right hon. Friend the Leader of the Opposition, who made a speech on exactly that point when the measures were going through in the early 1990s. Nevertheless, if the incomes of pig farmers have collapsed, it is appropriate for us to look at ways in which the situation might be improved. I welcome the fact that the Minister 1134 seems to be doing that. I do not question the detail of his proposed guidance in any churlish spirit. I recognise that he is a decent man. He has travelled up and down the country listening to farmers in the past year, and he has charmed many of them.
§ Mr. Yeo
My hon. Friend anticipates me. However, I fear that, after two months in the job, the Minister suffers from two shortcomings. The first is that he no longer enjoys the support of the Prime Minister. The second is that, for all his decency and charm, he does not seem to be strong enough to do the job and stand up for British consumers and farmers who look to him for a lead. Recent events have made both shortcomings painfully apparent.
In our debate eight days ago, the feeding practices of French livestock farmers were not mentioned because hardly anyone in Britain was aware of them. Last Friday, however, we learned that some French cattle, chickens and pigs had been fed with sewage sludge. So that the House is in no doubt, let me explain that the term "sewage sludge" includes the solid waste removed by filters, material resulting from the chemical and physical processing of waste water and residues resulting from the biological treatment of waste water.
The European Commission inspectors found that in some French plants, not only animal and industrial waste but human waste was incorporated into the sewage sludge subsequently used in animal feed. The existence of that practice was brought to the attention of the Ministry of Agriculture, Fisheries and Food and the Department of Health or 10 June 1999. In the four months that followed, Ministers took no action whatever to warn consumers in Britain that French chicken, pork and beef sold here had come from animals fed in that way.
§ Mr. Yeo
In a moment. The right hon. Gentleman spoke for almost an hour. I will let him intervene, but I want to finish this important point.
The failure of Ministers to take action is disgraceful. It is made more so by the fact that the Prime Minister himself told my hon. Friend the Member for Ryedale (Mr. Greenway) on 16 June:Of course we are trying to do something about it".—[Official Report, 16 June 1999; Vol. 333, c. 392.]Yesterday it became clear that the Prime Minister had done nothing about it.
The Minister's silence during those four months is also disgraceful because his official advisers have told him:The practice of using sewage sludge is both unacceptable from the consumer's point of view and illegal under European law.
§ Mr. Yeo
In a moment. I did not intervene once on the Minister and I should be allowed a few minutes to make a point.
Some, perhaps all, the British consumers who have bought and eaten illegally fed French meat in the past four months might have wished that the information that the 1135 Minister received in June had been drawn to their attention. They might have wished it even more if they had known that Professor Hugh Pennington, appointed by the Labour Government to investigate the E. coli outbreak, believes:There is potentially grave danger in eating animals that have been fed on treated sewage".They might have liked to know that Professor Mac Johnston, an adviser to the European Union scientific veterinary committee believes:If the French farmers are actually doing something that is illegal, then in my opinion that makes the food produced from these animals unfit for human consumption … I think here one has to adopt a precautionary principle, where the first thing is that you put a hold on it, you withdraw it from the food chain until you are satisfied that it is safe.Professor Philip Thomas, the chairman of the Government's Advisory Committee on Animal Feeding Stuffs, believes:It is potentially possible that there could be contamination into the food chain through these sources.
§ Mr. Yeo
In a moment. We are not going to leave this point. The Minister must not get too excited.
Despite that advice, the Minister did not think that it was necessary to issue any warning to consumers. Even when the scale of public concern became apparent in the past six days, he still did not feel it necessary to act. So unconcerned was he that he has not even spoken to his French counterpart during the crisis. When it was suggested to him yesterday that he might do so, he dismissed the idea as nonsensical.
Livestock farmers in Britain, almost crippled by regulatory burdens imposed on them by Brussels and Whitehall and almost driven out of business by unfair competition from abroad, might have hoped that, in the wake of the public exposure of illegal and disgusting French animal feeding practices, Britain's Minister of Agriculture would talk to the French Government.
§ Mr. Brown
The truth is that we are working on this issue through the Commission. The hon. Gentleman suggests that it has come as a surprise to everyone, but it was commented on in the press over the summer. Had he felt so worried about it, he could have raised it on any of a number of occasions. He has not done so. He says that I should have warned the public. He partially quotes the full advice given to me by the Government's professional advisers. I have put it all in the public domain. It is available to everyone to read. He does not quote the conclusion, which is that there is no risk to human health. It would be on such a conclusion that the Government would act.
As there is no risk to health, the Government have not introduced a ban. The hon. Gentleman is trying to distort the evidence to justify a protectionist position. That is the difference between us. He wants to use any evidence that he can find against our partners in the EU because the Conservative party is opposed to the EU and our partners within it.
§ Mr. Yeo
The Minister is saying that when he and his officials are warned that French meat is fed on human 1136 sewage—a practice that is unacceptable to consumers and illegal under European law—the Government should do nothing for more than four months to bring the matter to the attention of British consumers. He is saying that when British livestock farmers are struggling for survival, undermined by illegal foreign competition, the Government should do nothing to establish a level playing field. He is saying that when a leading scientist, Professor Pennington, on whom the Government rely for advice on hygiene, says that there is potential grave danger in eating animals fed on sewage, the Government should do nothing to require labels to disclose whether food has been produced illegally. He is saying that when a crisis threatens to engulf Anglo-French relations, and the French farms Minister cancels a planned visit to London to go to the Caribbean, it is not the Minister's job to pick up the telephone and have a chat with him.
The Minister stands condemned more out of his own mouth than by anything that I could say.
§ Mr. John Greenway (Ryedale)
Apropos the question that I put to the Minister earlier, is not the case for a meat and bonemeal ban across the EU now so formidable that even if the Government are not prepared to impose a unilateral ban, at the least they should ask the European Commission to impose one? If we have to have the ban, it must be because there is a risk of cross-contamination and a risk to human health. If the problem arises in Britain, it must surely arise on the continent, especially in France, where the number of BSE cases is rising. I put that point to the Prime Minister. It justifies action by the Commission.
§ Mr. Yeo
My hon. Friend is right. We have clearer and clearer evidence daily that the most appalling double standards are being operated when it comes to food safety and hygiene in different countries in the EU. We know that the Government are washing their hands of any responsibility to deal with the problem. I have to say, more in sorrow than in anger, that I believe that in my constituency and those of my hon. Friends, farmers and consumers will feel badly let down by the refusal of the Minister and the Government to act.
This scandal demands a proportionate and targeted response—a precautionary ban on the import of potentially contaminated French meat until the French Government explain what they are doing to end those illegal practices and to eliminate food produced by them from the food chain.
§ Miss McIntosh
Will my hon. Friend help the Minister and me by confirming the fact that it is a principle of European law that, if an item has been produced by illegal means, it is illegal for that item to be available? It can thus be prohibited throughout the EU—not only in this country. Items produced by illegal means—such as produce from this disgusting sewage—should not be allowed anywhere in the EU.
§ Mr. Yeo
My hon. Friend is right. She raises the important question of why no one is prosecuting those French plants which are using those illegal methods. 1137 It would have been encouraging if the Minister had spent even one of his 59 minutes in telling us that he would press the EC to take such action.
§ Mr. Yeo
If the hon. Gentleman underwrites my costs in consulting the lawyers, I shall be happy to obtain the most detailed legal advice. It is clear to me that these illegal practices should be stopped; if the Government will do nothing about them, it may be left to organisations such as the National Farmers Union to bring legal actions. I deplore the fact that Ministers are washing their hands of responsibility for taking any action at all.
Yesterday, the Prime Minister misled Parliament when he said that the ban that we called for would be illegal. Every EU country has the power to ban imports if human health is endangered. As I have already explained, many leading scientists believe that human health is endangered.
§ Mr. Peter L. Pike (Burnley)
On a point of order, Mr. Deputy Speaker. Is it in order for an hon. Member to say that the Prime Minister misled the House—as the hon. Gentleman has just done? I thought that such an expression was unparliamentary.
§ Mr. Deputy Speaker (Mr. Michael Lord)
Order. It is not in order for an hon. Member directly to accuse any other Member of misleading the House, but such remarks must be taken in the context of the cut and thrust of debate.
§ Mr. Brown
I am grateful to the hon. Gentleman for giving way. For completeness—so that we can all understand the professional advice to the Government—I shall read it out. The advisory committee continues to advise on the basis set out—that is, the points to which the hon. Gentleman referred—thatthere is no immediate public health risk and therefore no basis for seeking a ban on French products at either a community level, or unilaterally.
§ Mr. Yeo
The Minister has read out the conclusion of the advice that he received—I have a copy of the same document. My point is that, if the Government thought that human health in this country was endangered, there is a legal basis for the introduction of an import ban. 1138 The Prime Minister was wrong to say that such a ban was illegal. It would be perfectly legal to take such a step if there was a danger to human health.
§ Mr. John Townend (East Yorkshire)
Does my hon. Friend believe that, if the boot were on the other foot and we had been feeding our cattle or sheep with food that had sewage in it, the French would take no action at all?
§ Mr. Yeo
No, I must make some progress.
My hon. Friend the Member for Bexhill and Battle (Mr. Wardle) asked whether the illegal feed is heated sufficiently to make it safe, and my hon. Friend the Member for South Dorset (Mr. Bruce) asked about the Government's powers to prevent British farmers from doing what the Government think it is unnecessary to prevent French farmers from doing. The Minister's refusal or inability to answer those questions simply strengthens the case for the ban.
The Government's failure to act is leading us to the kind of trade war that they claim to want to avoid. British consumers shun French goods—not only meat—French farmers blockade British exports, while the Government do nothing. Four weeks ago, after France announced that it would continue to block British beef exports, the Minister responded—in a fashion that might be described as tit for tat—with his own one-man boycott of all French goods. Instead of a policy to deal with the problem, he has produced a feeble, ineffective and irrelevant measure—one, incidentally, that even his right hon. Friend the Prime Minister pointedly refused to support.
§ Mr. Yeo
I have made it clear that I certainly eat no French meat from animals fed with human sewage. I much prefer to eat British meat at all times, but, as the Minister is aware, those of us who frequently have to eat away from home, in catering establishments, often have no idea where the meat comes from.
§ Mr. Yeo
NO—[HON. MEMBERS: "Give way".]—No.
I have set out our approach on contaminated French meat. I shall now deal with the beef export ban. Almost a year ago, the Minister told the House:We have achieved a major objective of our policy towards Europe in the lifting of the beef export ban."—[Official Report, 25 November 1998; Vol. 321, c. 190.]On 17 December 1998, the Minister claimed:That was a major breakthrough reflecting months of dialogue within the European Commission and with our European partners."—[Official Report, 17 December 1998; Vol. 322, c. 1091.]Seven months later, the Minister was able to announce a date for the resumption of exports—1 August. He told us that this had been achieved byLabour leadership in Europe … our constructive approach towards our European partners has clearly been shown to succeed."—[Official Report, 14 July 1999; Vol. 335, c. 405.]The Government, the Prime Minister and especially the Minister have learned that, as the Prime Minister put it so clearly yesterday, there is adifference between an easy headline and a good policy."—[Official Report, 27 October 1999; Vol. 336, c. 1011.]Two months after 1 August, the French Government announced that they would not accept British beef. It appears that, despite the Minister's confidence about the lifting of the ban, before he made his claims in this House, he had not even bothered to check with either France or Germany that they were ready to agree to the deal. As France abstained on the matter at the November 1998 Agriculture Council, the Minister was already on notice that the French might be less than wholehearted in their support of the Commission. Against that background, any remotely competent or responsible Minister would have phoned his French counterpart. However, we know that this Minister is not in the habit of doing that—whatever the gravity or urgency of the matter.
I have traced the history in detail because, this very day, the Scientific Steering Committee is meeting to decide whether to reject the French so-called "evidence" on which their decision to continue blocking British beef exports is based.
We read in the press of a possible compromise: France may drop its illegal ban on British beef if we accept yet more controls on British cattle and British slaughterhouses. I make it clear that the Conservative party believes that demands for more controls are outrageous and unjustified. Under no circumstances should Britain accept any further intrusion into the way that British beef is produced. Our cattle are among the most carefully scrutinised creatures on earth and, if the British Government allow any tightening of the way in which beef production is regulated, they will prove once again that they do not have the guts to stand up for what is right. Weakness on this issue, at the very time that 1140 France has been exposed as being guilty of disgusting and illegal practices in its own backyard, would simply add insult to injury.
§ Mr. Blizzard
Even given all that the hon. Gentleman has said, will he accept that we are much further forward than his Government reached with their ridiculous policy of non-co-operation in Europe, which got us absolutely nowhere? As things stand, the ban has been lifted in the European Union and all but one country are observing it.
§ Mr. Yeo
I will not make the mistake of giving way to the hon. Gentleman again.
During Agriculture questions last week, the Minister said:Under the Conservative Government's stewardship of this issue, Britain was isolated within Europe. Under our stewardship, France is isolated within Europe."—[Official Report, 21 October 1999; Vol. 336, c. 573.]For the sake of Britain's beef farmers, I hope that the Minister is right. I suggest, again for the sake of our beef farmers, that the Minister should boost confidence today in their product by taking the advice of the chief medical officer in London and lifting the ban on beef on the bone. Why is the Minister too weak to do that? Why do unelected bureaucrats in Edinburgh and Cardiff now make the policy for England? Does the Minister not understand that his Labour Government kept telling us that devolution would mean different policies in different parts of the United Kingdom? When will he understand that, if the British Government have less confidence in honestly grown British beef than in meat from animals fed with human sewage, it is not surprising that the French Government take the same view?
§ Mr. Thompson
Is it not a fact that, if the Minister lifted the ban on beef on the bone in England, other countries would quickly follow suit?
§ Mr. Deputy Speaker
Order. Before the hon. Member for South Suffolk (Mr. Yeo) responds, I must point out that there have been many interventions this afternoon. Many hon. Members wish to speak in the debate and, if there are many more interventions, a lot of hon. Members will be disappointed.
§ Mr. Yeo
I shall try to speed up my remarks.
The crisis in the pig sector is so urgent that there is a danger that our industry will disappear. The size of the British sow herd is declining while the Danish, Spanish, German and Dutch herds are increasing. United Kingdom pigmeat imports from the European Union are rising and Britain's pig farmers are losing £3 million a week. I welcome the Minister's allocation of £5 million in marketing aid and his public support for the Meat and Livestock Commission's pork mark. The Minister has recognised that offal disposal regulations are an extra cost on pig farmers of about £5 per pig, which is not borne by our competitors abroad.
Given the severity of the crisis, I hope that the Minister will find a way of absorbing some of those extra costs into the public sector—bearing in mind that they arose originally because of BSE. The Minister also recently showed his willingness to absorb cattle passport charges 1141 and specified risk material removal charges for a limited period. I hope that he will do the same with offal charges for pig farmers.
Conservative Members often refer to public sector purchasing. I believe that all public sector meat purchases should come exclusively from sources that match British production standards. I was shocked to learn that the Liberal Democrat-controlled Devonshire county council is still buying French chicken burgers to feed to the children in its schools. That is in marked contrast to the Conservative-controlled Kent county council, which acted promptly to look after the interests of the children in its schools.
§ Mr. Burnett
I do not believe that a United Kingdom company tendered for the Devonshire contract. Is the hon. Gentleman aware of that?
§ Mr. Yeo
Exactly. I am not sure that the lack of a United Kingdom company tender will necessarily reassure those parents who now know that their children are being fed products that were produced illegally in another country.
On 1 July, the Minister said:I have on my desk draft letters waiting to go out to the major public authorities … urging them to source products of the highest welfare and animal hygiene standards".I asked the Minister last week how many letters he had sent and how many replies he had received. I hope that that information will not be too difficult to come by: if the letters were ready to send on 1 July, some replies must have been received by now. I hope that the struggling pig farmers who are keen to be reassured that the Minister is doing all that he can will hear now that those letters have been sent.
§ Mr. Brown
I have only just sent the letters because I wanted them to be part of a concerted campaign that we have launched in discussion with farmers and the industry. As I said in my address, we all have a part to play. I invite the hon. Gentleman, in a completely bipartisan spirit, to join me in the campaign to urge public authorities to purchase British because of the welfare and production advantages of so doing.
§ Mr. Yeo
It is a question not of my joining him but of his joining me. We pointed out last November in our document "A Fair Deal" that one of our four key aims was to raise public sector purchases of meat to that standard. The Minister has just revealed the sequence of events. On 1 July, he said:I have on my desk draft letters waiting to go out".—[Official Report 1 July 1999; Vol. 334, c. 422.]I reminded the Minister of that response last week. We asked him whether any letters had been sent, and his reply was evasive. I assume that the letters were not sent until he was prompted to do so by the Opposition. He delayed for almost four months after giving that assurance at Question Time.
§ Mr. Brown
I have already explained that I wanted to send the letters as part of a concerted campaign with 1142 farmers. There has been a range of discussions about this matter, and I invite the hon. Gentleman to join me in the campaign. The hon. Gentleman claims that it has been his policy since last November. What public authorities has he written to and what responses has he received? Let us do this together.
§ Mr. Gill
It may assist my hon. Friend to know that the Minister gave that answer on 1 July because, in frustration, I had asked him what he had done or what influence he had with his colleagues in the Department of Health and the Department of the Environment, Transport and the Regions, to whom I had written in my capacity as president of the British Pig Association weeks before that exchange in the House of Commons. So the situation is much worse than my hon. Friend describes.
§ Mr. Yeo
I am grateful to my hon. Friend for that information. I agree entirely with the verdict of my right hon. Friend the Member for Bridgwater (Mr. King). Those pig farmers who are calculating from week to week whether to stay in business or to close down will be very disappointed with the overall impact of the Government's announcement today. The Minister must understand that there is a strong possibility that his tenure at the Ministry of Agriculture, Fisheries and Food will cover the period when a large chunk of the British pig industry closed down. Thousands of small businesses, which have been built up through years of hard work, will be destroyed.
I shall leave to my hon. Friend the Member for South-East Cambridgeshire (Mr. Paice), who will wind up the debate for the Opposition, our concerns about dairy farmers, bovine tuberculosis and the difficulties that have been imposed on Milk Marque by the Government's dogmatic decision not to allow it to invest in processing until it has been broken up into smaller units.
I shall pass over our concerns about last week's reports about the Cabinet Office paper recommending that prime agricultural land should no longer be maintained in food production. I am not sure what message that sends about the Government's long-term intentions for agriculture. I shall also pass over our concerns about the proposal to add burdens to farmers in the form of a pesticide tax and a climate change levy. Those measures will not achieve the environmental gains that are claimed for them, but they will certainly help a few more farmers to go out of business.
The Government's announcement about organic production is extremely welcome. I welcome the fact that the Minister has responded to the heavy demand by organic farmers for assistance with conversion in the current year. That will be appreciated by everyone who is interested in organic food.
I was concerned by the rumour yesterday about a U-turn on the timetable for the commercial planting of genetically modified crops because that seemed to be a tactic to divert attention from the main issue of the day. If the Government have seen the light on GM crops, I welcome that. I support any decision to delay the commercial planting of GM crops until the research that 1143 is under way has demonstrated that those crops are environmentally safe. A designated period of three years would be artificial; we need to proceed on the basis of sound science. I urge the Government to increase significantly the buffer zones that surround trials of genetically modified crops to protect neighbouring conventional and organic farms.
British agriculture is in crisis. The Government's response has veered from irrelevance and hostility at worst to complacency and inaction at best. The Minister has lost the confidence of the Prime Minister and it seems, from the almost empty Treasury Bench, that not many members of his Cabinet support him either. For all his sympathetic manner, he is in danger now of losing the confidence of the farmers too. His speech, which lasted almost an hour, contained little of substance that will reassure consumers or producers in this country that their interests will be protected.
The Government will have the full support of Conservative Members whenever they act in Britain's interests, but as long as they continue to let down Britain's farmers and fail to protect British consumers, they will stand condemned not only by all those hon. Members who are concerned about the future of the countryside, but by all the British people.
§ Mr. Deputy Speaker
Before I call the next speaker, I remind the House that Madam Speaker has placed a 10-minute time limit on all Back-Bench speeches in this debate, and that that applies from now on.
§ Mr. Russell Brown (Dumfries)
I am grateful for the opportunity to take part in this debate on an issue of great importance to my constituents. There is little doubt that most hon. Members, especially those who represent rural constituencies, are concerned about the difficulties facing the agriculture sector.
My constituency lies in the region of Dumfries and Galloway, where a third of the population lives in wholly rural areas, compared to some 10 per cent. of people in Scotland as a whole. That is reflected in a heavy reliance on agriculture, with an agriculture work force of more than 7,400, which is four times greater than the Scottish average. Subsidies to Dumfries and Galloway are four times higher than the Scottish average. About 25 per cent. of the part of the gross national product that comes from Dumfries and Galloway is produced by the agriculture sector.
Since 1981, however, there have been almost 1,500 agriculture job losses in the area. Not only have farmers in my constituency had their incomes fall by up to 75 per cent. in real terms over the past two years, but several sectors have been affected at the same time. As we well know, sheep farmers have, as a result of over-supply, seen the market price fall dramatically to as little as £1 per head. Dairy farmers continue to watch milk prices fall. The pig sector, as we have heard this afternoon, has declined by 12 per cent. over the past year, and there has been continued downward pressure on prices as other European Union herds expand. The beef industry still suffers prices that are 20 per cent. below pre-BSE levels.
1144 When the agriculture industry faces difficulties, so does the wider rural community. There is an impact on the oft-forgotten low-paid agriculture workers, local shopkeepers in our villages, small firms who supply our farms, agriculture engineers, auction markets and vets. We need to be clear that the causes and, therefore, the solutions, are more complex than some Conservative Members might try to make out.
I have met farmers in my constituency regularly, and they know that they face a combination of unprecedented factors such as the collapse of markets in south-east Asia, the fall in the value of common agricultural policy support payments, the over-production of certain commodities in much of Europe, cyclical downturns and, of course, the aftermath of the Tory BSE crisis. The Government often have little control over those factors.
I welcome the fact that throughout these difficult times the Government have made a realistic level of assistance to farmers one of their priorities. I said that my constituency relies heavily on agriculture. By definition, therefore, it benefits substantially from any support that the Government give the industry. On three occasions since the general election the Government have given the agriculture industry in my constituency substantial additional aid.
§ Mr. Brown
I should like to give way, but I must move on because time is short for everyone this afternoon.
In February and November 1998, support worth more than £10 million came to Dumfries and Galloway. The region is set to receive a further £7.5 million from the aid package announced by the Government on 20 September, which is almost 5 per cent. of all the moneys and 20 per cent. of Scotland's stake. Farmers in my constituency are grateful for that support, which they would not have received from the Conservative party.
The Government's support for the industry contrasts sharply with the policies being pursued by the Leader of the Opposition, which have fallen off the back of a lorry and are part of his right-wing revolution. They include his calls for a ban on French chicken, pigmeat and beef, not on health grounds but simply because they are French. If the Tories are not prepared to listen to scientific advice when making their decisions, why should they expect the EU Scientific Steering Committee on food and animal health to do so today?
§ Mr. Peter Luff (Mid-Worcestershire)
On a point of order, Mr. Deputy Speaker. The hon. Gentleman said, quite reasonably, that he would not give way because of the 10-minutes rule, but I understand that the clock is stopped to permit interventions during speeches made under that rule. Is that the case?
§ Mr. Deputy Speaker
The clock is stopped for the duration of the original intervention, but is started again when the hon. Member who is on his feet replies.
§ Mr. Brown
The Tories' policy would lead to a trade war, destroy thousands of jobs and put at risk our multi-billion pound a year exports to France. Ben Gill, the president of the National Farmers Union, described that 1145 policy as illegal, and Jim Walker, the president of the National Farmers Union of Scotland, described it as outrageous. I suggest that not even the Leader of the Opposition's own party can stomach it.
I have here a copy of my local newspaper, the Dumfries and Galloway Standard, from Wednesday 27 October. The headline says,Council says 'non' to ban on French beef'.A motion was put before the council on Tuesday which called on the council to consider banning French goods. Councillors rejected the very call for a ban by some people. The Tory group on the council said that any boycott or ban would mean thatthe only losers would be Scottish farmers.Yesterday, The Herald featured an article by Struan Stevenson, who was the Tory candidate defeated by myself and the votes of people in rural Dumfries.
§ Mr. James Gray (North Wiltshire)
On a point of order, Mr. Deputy Speaker. Is it not odd that in a debate in which Back-Bench speakers are under such pressure, as you have already pointed out, a Member for a Scottish constituency should speak first from the Back Benches on matters that are properly the responsibility—
§ Mr. Deputy Speaker
Order. It is not for the hon. Gentleman to challenge the Chair's selection of speakers.
§ Mr. Brown
I was explaining that Mr. Struan Stevenson was defeated by myself and the voters of rural Dumfries at the election. As his punishment, he finds himself a Tory agriculture spokesperson in the European Parliament. In his article in The Herald, he does not hide his complete contempt for the policies of the Leader of the Opposition, and warns:In our enthusiasm for kicking the French, we seem to have forgotten that they are perfectly capable of kicking us back.Mr. Stevenson also calls for cool heads to sort out the French ban on British beef, which certainly rules out the right hon. Member for Richmond, Yorks (Mr. Hague), and makes it clear that the responsibility for taking action against the French rests with the European Commission.
The immature nonsense of the Leader of the Opposition yesterday showed that the Tories have learned nothing from the BSE-inspired war on Europe three years ago. Then, they promised to block treaties and directives, but the only thing that they blocked was the lifting of the export ban on British beef, demonstrating Britain's lack of influence in Europe under the Conservatives.
As for the Tory party's other policies on agriculture, its call for more labelling is already being pursued by the Government through the implementation of tough new laws. Indeed, more were announced yesterday by my right hon. Friend the Minister. They will ensure that shoppers can tell clearly whether the products that they buy are British, and that consumers may show their support for British farmers, as I do, by purchasing their products.
Also somewhat belatedly, the Tories have called for reform of the common agricultural policy, something that is already being pressed for by the Labour Government, and which, during their 18 years in power, the Tories made no serious attempt to achieve.
1146 If we were to embark on the trade war that the Tories are advocating, perhaps an Opposition Member could suggest how I would explain to workers in the slaughterhouse that is less than three miles from my home that we were closing down the marketplace in France—that same marketplace on which more than 90 per cent. of their lamb production and their very livelihoods depend.
§ Mr. David Curry (Skipton and Ripon)
Small foreign wars have always been a traditional distraction from large domestic problems. The French conflict is one such matter. It is an illusion that we are about to bury the French market under thousands of tonnes of beef, ban or no ban. If the problem were solved today, or had never begun, it would have no immediate impact on problems in the United Kingdom.
The French have dug a pit for themselves and fallen into it, and I have precious little sympathy with them. We should concentrate on isolating them, piling the pressure on in the European Union and making their position untenable.
I have no sympathy for the call for a ban on French products, and I shall tell the House why. I cannot imagine a single action more calculated to extinguish the last flicker of life in hill farming in north Yorkshire than encouraging a trade war that puts at risk £136 million worth of live lamb exports to France and leaves the farmers' ferry—a courageous initiative among British farmers to export their lambs—vulnerable to pressure. We should not be in the business of trying to out-gun The Sun when it comes to attacks on our European partners, however wrong they are in this instance.
We have not helped our cause by maintaining the beef on the bone ban. The Minister must knock some heads together in Scotland—I know that he would like to do so—because, otherwise, the tail will be wagging the dog. The ban is a wonderful pretext for the French.
The article in the New Scientist about contamination of carcases by brain tissue during slaughter did not help either. It was, of course, faithfully reproduced in the French press. Meanwhile, the Daily Mail says that we are heading for "a stitch-up". I hope that it is right, because a stitch-up is better than a shoot-out in practically all circumstances.
Two years ago, I said that the hills in my constituency were bleeding. That haemorrhage has not stopped. I shall refer to Skipton auction mart, because I have taken the trouble to find out what is happening immediately and locally.
The first big gimmer lamb sale of the year—for those who do not know, a gimmer is a female sheep—is in September. In 1997, gimmer lambs were fetching £74 a head. In 1998, they sold for £46 a head. At the most recent sale, they fetched £25.13 a head. The hill farmer is the one who suffers. His draught ewes—ewes that have had three or four crops of lambs—are usually sold down the hill to the lowlands, where they may continue productivity in slightly easier conditions. Three years ago, they sold for between £50 and £60 a head. Last year, the price was £35 a head, and today it is £20 a head. Shearlings—sheep that have been sheared once—were fetching £60 in 1998, but now sell for £38.
At the end of September, 659 old ewes were sold but 689 were given away. In one pen, in which there were 41 ewes, one was sold for £1 and the other 40 were given 1147 away free with it. The problem is the requirement to split sheep. Ewes could be worth £8 to £10 for export without that requirement which we have imposed. I hope that the Minister will review that urgently.
I took the precaution of talking to the man in my constituency who probably knows most about cattle—the knackerman at Bentham. He has an enormous constituency of his own, which covers north Lancashire, Craven and Cumbria, and even stretches into Scotland. Normally, at this time of year, Mr. Robinson is called out for the casualty kill of about 200 calves a week. At the moment, he is being called out for about 530 to 600 calves a week. Of course, those calves are shot for nothing. The knackerman takes them off and gets a fiver for the hide, and the farmer puts them down as stillborn because there is no price for them. A few—the better end of the Friesians—are kept on.
As for the sheep, some are taken by traders to the ethnic markets in west Yorkshire, where there is a demand. Others are shot for £8 on the farm and thrown straight into specified risk material because there is no market for them.
Bentham mart is tiny; we would normally expect about 150 calves a week to go through it. At the moment, 30 are going through. The mart is in the habit of paying farmers' sons about £4 an hour to help manage animals. Now, farmers who are 50 years old and more are queueing for those jobs in order to supplement their incomes because they are receiving so little from their stock.
Nationally, one would reckon at this time of year that about 13,000 calves a week would be presented for the processed aid scheme—that was last year's figure. Now, if we estimate that perhaps 7,000 are retained on the farm and about 3,000 are going into veal, that leaves 3,000 to 4,000 that are being killed on the farm because there is no future for them, and farmers do not want to pay the cost of tagging such animals.
At this time of year, cull cows are put forward. Under the maximum weight of 560 kilos, they are fetching 51p a kilo. So the maximum price for a calf culled from—probably—one of the suckler herds is £285.60.
Seven dairy herds in my constituency have been sold at the Skipton mart alone since mid-summer. The smaller farmers are selling weekly as the animals calf. Because it has been a good year for forage, grass has been good and the quality of feed high, people have overestimated quotas of milk production, resulting in 1 million litres of milk being sold a few days ago at Skipton mart. It was leased for an average of 6.53p a litre, rising to 7p. That is for farmers who will receive perhaps 17p a litre for the finished product.
As my hon. Friends have said, the situation is worst in the pig sector. I have talked about livestock because such production is the predominant form in my constituency. There are offal and bonemeal disposal costs. I am pleased that the Minister is seeing whether he can return some value to that product.
The threat of the new integrated pollution prevention and control regulations has been mentioned. By charging for the new sheep-dip regulations, the Environment Agency is already making itself extremely unpopular. We have been told that a unit of 2,000 finishing pigs or 750 sow places could cost £12,000 a year in inspections, with a registration fee of about £18,500. I hope that the 1148 Minister will be able to give some indication of what is intended, and, even better, that he will defer whatever he was intending in that regard.
We ought to be careful in one regard when talking about pigmeat. It is true that pigmeat is imported, but the largest supermarkets that are importing almost invariably require the same conditions in the pigs imported as they do for those that have been raised in the United Kingdom. We should not give a false impression that, somehow, every pig that is imported has been raised in ghastly conditions, but that every UK pig has been living in pristine surroundings. The salmonella count might correct that.
What is the Government's response? The Minister, like some slightly unctuous parson from a Jane Austen novel, wrings his hands over the open grave and tells the family how he quite understands their grief, but that, at the end of the day, we are all in the hands of the Lord—or at least the Treasury.
Government action has been largely to defer new burdens on farmers—such as abattoir charges or cow passports—to defer cuts in support, which, admittedly, the Minister increased, but which he would otherwise have decreased, and then to brandish the new burdens. It hardly relieves a farmer's present hardship to be told that an extra burden will no longer be imposed.
I mention, simply for the record, that so far the cost to the public of the BSE inquiry is £32 million, half of which has come from the Ministry of Agriculture, Fisheries and Food budget. Where it will end, no one knows. I shall be interested to see what the positive outcomes of that are.
We accept that there are things that the Government cannot be held responsible for, or cannot influence. The level of the pound is a major handicap to the industry. We can talk ad infinitum about the Government setting out their perspective on economic and monetary union, but we have had that debate before and it obviously will not coax them into more positive action. What can we do? It is important to lift the beef on the bone ban, because by doing so we remove the last pretext for those who do not wish to import our beef. We must also make it clear that no new charges will be imposed in the present crisis.
The Minister should end the requirement to split sheep carcases. He should also pursue his inquiries about the means of helping the pig producer by giving some value to the products that he now has to discard—offal and bones.
We need to know—I am pleased to hear that we shall shortly hear—how the Minister proposes to remodel the hill livestock compensatory allowance, the upland payments that make up the entire net farm income in my constituency. I hope that he will also consider company specification in the pigmeat sector, which his officials have discussed, and whether it would be more transparent to move to a national specification so that farmers at least know what is happening to their pigs in the slaughterhouses.
As I am sure the Minister knows, a way of life is under threat. Farmers in my constituency are, by and large, over 50. They have no heirs, or no heirs who want to take up the business. They have precious few skills. It is illusory to talk about bringing new businesses into that 1149 environment. It is a particular environment—a very special environment; if we do not have the farmers to maintain it, the ultimate—
§ Mr. Alan Simpson (Nottingham, South)
I confess that I have been boycotting French beef for about 20 years—but as I have been boycotting everyone else's beef for about the same period, I am sure that the French will not take it personally. In so far as the Minister may be moving in the same direction—towards non-meat consumption—I would welcome that, but it does not bother me if he is not.
The important aspect of all this is that, really without our permission, the United Kingdom is now well and truly involved in a long-overdue debate about safe food. In only the most perverse sense is it to the credit of the Tory party that we are holding this debate. We need to remind ourselves that, for all the attacks that are made on the Minister, he was not in office at the start of the BSE crisis. Labour was not in office at the start of that crisis. The only credit that the Tories can claim is that they were, and that they got us into the mess. For all the mock anger and furore that they throw at the Labour Government, we would not be in this mess had it not been for the catastrophe of the Conservative party's approach to agriculture.
Those who proclaim a new-found interest in the precautionary principle could not be seen for dust when that principle should have been applied to the process of questioning what we were feeding livestock in the UK. At that time, the Tories were involved in little more than a dash for crap that they could feed to cattle as long as there was a cash return at the end of it. That is why we are now paying such a huge cost.
As a consequence of that period, we must now completely reassess our agricultural and safe food agenda. The British public have a right to demand that of us. It is important to set down the benchmarks—not the costs of moving from where we are, but the costs of getting out of the mess that we have got ourselves into. Already, the crisis in relation to BSE has cost us about £4.6 billion and about 40,000 jobs, and has had an unquantifiable cost in the loss of more than 40 lives. No one is prepared to put a ceiling on how many lives that disaster will take, but everyone knows that there will be significantly more.
§ Mr. Paterson
May we get it on to the record that there is no proven scientific link between BSE in cattle and new version CJD in human beings?
§ Mr. Simpson
I remind the hon. Gentleman that it was a Conservative Minister who admitted in the House that that was the most likely cause of the BSE crisis. The House would do well—
§ Mr. Simpson
It is all very well for Members to shout from a sedentary position that it was not proven. They are 1150 now, belatedly, saying that the precautionary principle should drive our policy. I favour the precautionary principle, but they have caught up with it a bit late in the game. Had they applied it, we might not have been in this situation.
I hope that there will be a willingness to apply the precautionary principle in relation to another aspect of the debate—the desire of the food biotechnology industry to transform the agricultural system, not necessarily to feed the world but to take ownership of the food chain. I remind the House that, of those who would seek to regulate the development of GM crops, the Labour Government and Labour Ministers have been the most committed to introduce a regulatory framework where none previously existed.
§ Mr. Simpson
No. I do not think that I can give way in a 10-minute time space.
I want to give positive support to two aspects of the Minister's speech. I welcome the support for organic farming but, if we are to refocus the food debate to catch up with the public, who are leading it, we must set ourselves more ambitious targets and more generous budgets for that transformation. The sums allocated have already been taken up. That problem is a measure of the popularity of the Minister's intervention, and that problem is in fact a success story.
As I understand it, about 100 farmers a month are offering to convert to organic farming, at about the rate of 10,000 hectares a month. They are dead keen to produce foods that the public are dead keen to buy. When we are on such a winner, we would be well advised to go with it. Doing so would require additional funding from the Treasury or, at least, a relocation of the current subsidy system, which would allow us to take some of the £3 billion a year that we put into agricultural subsidies—especially those parts that we pay for a pause in an unsustainable agricultural system—and redirect it into the creation of a sustainable agricultural system.
If the Government are serious about that, I urge the Minister to read the Organic Food and Farming Targets Bill, presented to the House on 26 October. It suggests that it is quite feasible for the UK to set targets for 30 per cent. of farmland and 20 per cent. of food consumption to be taken up by organic farming processes by the year 2010. That would cost about £150 million a year—about 5 per cent. of the current subsidies to agriculture through the common agricultural policy system. That shift would be welcome in general policy terms and overwhelmingly welcomed by the public.
I congratulate the Minister on his part in supporting the Prime Minister in discussions about a moratorium on commercial approvals for GM seeds and GM crop production. That is extraordinarily important, but it is equally important to ask the Minister to consider the framework within which the moratorium will apply. I know that he is still keen for field and farm trials to take place, but I ask him to examine carefully the research published first by "Newsnight" at the end of September, then by Friends of the Earth, which showed that the current buffer zones of 50 m are simply nonsensical. It was shown that airborne GM pollen from oilseed rape had migrated 495 m, and that it had been carried 4.5 km by bees.
1151 The prospects of genetic pollution must be taken seriously and must be reflected in the buffer zones set for the trials that continue. It is extremely important that the Minister adds Government support for the public action that is leading the refocusing of the safe food debate. The issue affects not only existing organic farmers, but all the farmers who seek to convert to organic farming, as they are asking how they will be able to assert that the crops that they produce are GM-free, when neighbouring fields and farms are involved in GM trials.
If the Minister would re-examine my Bill from the standpoint of GM foods and producer liabilities, he might pre-empt the discussions that some of us are already holding with civil liability lawyers, and tell us that it is not necessary for us to go down the path of class actions for damages, driven by the public and the private sector. Safe food policy should be driven by Government lead, rather than by public lead.
I hope that the Minister will be enthusiastic about catching up with that momentum. We should extend the safe food agenda into local areas, perhaps through local food commissions. We should extend kitemarks to allow us to identify organic foods and targets, and we should reward those who shorten food miles, strengthen product accountability and give us food that the public consider safe to feed their children.
§ Mr. Colin Breed (South-East Cornwall)
It is said that a week is a long time in politics, although I have not found that to be true. A week ago, hon. Members in all parts of the House expressed their deep concern about the escalating crisis in all sectors of the farming industry, yet matters have only got worse since then.
Prices have fallen further, and more farmers have gone out of business or are considering doing so. France is engaged in deeply damaging illegal action, which not only has the potential to escalate into a full-blown trade war, but is undermining the confidence of consumers in countries that have lifted the ban in accordance with European Union scientific advice.
Politically, it would be attractive to catalogue events over the past 10 years, to remind ourselves of the context of the present position, to indulge in the exact science of hindsight, and to rehearse once again the breathtaking inadequacy, complacency and sheer incompetence of some Ministers and officials during those years of the Tory Government.
However, third and fourth-generation farmers in my constituency are going bankrupt, losing their business, their livelihood and their homes, and not only making themselves redundant, but putting their family members out of work. I, for one, am not prepared to stand in the Chamber and score petty party political points, or to jump on the nearest Euro-sceptic bandwagon in an effort to use this tragedy to fuel your own prejudices—[Interruption.] I deplore those who try to do so, and I hope that the constituents who are listening to you—[Interruption] will recognise—
§ Mr. Deputy Speaker
Order. I cannot let the hon. Gentleman go on making accusations about what my policies might be.
§ Mr. Breed
I hope that the constituents of hon. Members will listen to all that they say. It is a pity that 1152 we did not hear more of the common-sense approach of the right hon. Member for Skipton and Ripon (Mr. Curry). In his 10-minute contribution, he spoke volumes more than the official spokesman for the Opposition.
Despite the great scope for pessimism and the disastrous lack of confidence that abounds, we in the House should be giving hope to our farmers and taking the lead to generate the conditions that will enable the industry to trade its way out of the present crisis.
It is important to make it clear that agriculture has been, and will continue to be, a vital economic and social activity in this country. It provides the home-grown food that has sustained the country for centuries, and it will continue to do so if we tackle the crisis urgently.
At a time when the pig industry is on the brink of collapse, with prices below break-even level since April 1998—
§ Mr. Burnett
Does my hon. Friend agree that the charges for offal removal and the costs to the pig industry are directly related to BSE, and therefore that some form of compensation should be available to the pig industry as a direct result of that?
§ Mr. Breed
I strongly agree. The point was made earlier, and I endorse it.
The egg sector faces a bill of £625 million to meet new UK standards, only to have its produce rejected in favour of cheaper, lower-grade produce. The beef industry is still facing an illegal French ban. Nevertheless I, and I hope other hon. Members, remain adamant that we are not prepared to see the industry wither away under unfair and illegal competition. Nor do we want to see it limp from one crisis to the next, for ever seeking special treatment or emergency aid.
The industry needs a clear strategy for each of its sectors, to provide short-term stability and long-term security. If we expect our farmers to stay in agriculture, we must offer them a future that will be worth fighting for and investing in. Without that, more and more farmers will simply leave the land voluntarily, and get out while they still have some capital left. That will further reduce our productive capacity and invite ever more imports. The decline will accelerate and the disastrous downward spiral will be difficult to halt.
With regard to short-term stability, we cannot continue to load on to farming costs—my hon. Friend the Member for Torridge and West Devon (Mr. Burnett) provided an apposite example—that it cannot support, however well intentioned and whatever the merits.
Some of the quality assurance hurdles and inspection systems that we have imposed must be re-examined in the light of present trading conditions and the post-BSE era, to see whether they can be undertaken more economically or whether they are needed at all, always ensuring that compliance with requirements continues.
We need to review farm inspections. Why do several different inspectors call on our farmers almost every week for one inspection or another? Why cannot one inspector perform multiple inspections?
We need to re-examine the Meat Hygiene Service, to see whether the system can be made more efficient. I welcome the Government's action to secure relief for the low-throughput abattoirs from the need for veterinary 1153 supervision at post mortem inspections, but we should consider whether more can be done, especially to save those low-throughput abattoirs. To force them to close would be no real economy. It would just mean greater transport costs for farmers. Furthermore, we would lose the facilities to produce specialist goods, which fetch a premium in the marketplace and should be encouraged.
I am pleased that there will be an investigation into the operation of the MHS. When it reports, we must ensure that costs are kept to a minimum. In the wake of the Pratt report, we must ask why our costs are at the top end of the scale.
We must remove the threat of the re-introduction of charges such as those for cattle passports. I welcome the fact that those will not be considered until at least 2003. I hope that that will instil confidence for the future. In the mean time, we should review the figure of £7 per passport. Should it cost that much?
We must address the over-capacity in some sectors. Price stability in the market must be restored. A calf disposal scheme or a properly funded scheme to produce home-grown veal, as proposed by the hon. Member for West Dorset (Mr. Letwin) last week, is needed to address the bull calf problem. We cannot continue to sit by and expect our farmers to shoot their calves.
The banks must play their part, but before they can do so they, too, need some confidence in the future. They need to believe that agriculture has a future and that the Government will support it now and in the long term. Many bank managers have provided sympathetic support, particularly as they still believe themselves to have some security but, the more the overdrafts rise, and the more land values fall as receivers move in and put farms on the market, the more there will be no alternative but to call in the loans.
I welcome the labelling regulations that are to be introduced. I do not want to go into that, only to say that the supermarkets have made a business of undermining brands. They have increased their own brands to about 40 per cent. of sales. Ask any manufacturer of branded goods what they think about supermarkets selling their brands. In the long term, I agree with the Government that the strategy must be based on demand. To continue to bolster up the supply side is not a long-term solution.
§ Mr. Breed
I would rather carry on so that other hon. Members have a chance to speak.
The long-term strategy must be, first, to reinforce success, and, secondly, to develop new initiatives to build upon existing markets and develop new ones.
Clearly, organic production has been a success. It is one area in which premiums are being paid and sales are increasing, but we still import more than we grow. This is a sector which demands much more support, investment and encouragement, and I am delighted that the Government are providing that. Such support is not a subsidy but a true investment, which will yield real dividends for agriculture, the environment and the country.
1154 Many anxious farmers, such as Jim Candy in my constituency, are in the middle of their conversion, and more are just about to start. They need to know urgently whether they are eligible for the additional funding. I hope that the Minister will be able to provide detailed advice as a matter of urgency. The Government's announcement is a positive start, but it is unlikely to be enough. The present scheme is massively oversubscribed as, I suspect, will be the next tranche.
It would be unwise to increase production rapidly because of the possible effect on market prices, but I suspect that there is a long way to go yet before we reach that position. Where there is an obvious demand, we must ensure that there is a potential British supply.
Farmers markets, of which I was an early supporter, are another part of the way forward. I am delighted that they are growing in number and frequency, but they are still in a fledgling state and largely run on an ad hoc, semi-craft basis. That is not acceptable for the future. If they are to be part of the long-term strategy to improve the demand side, they must be much more robust. It is important that farmers markets become a real source of competition to the fresh meat and produce counters in the local supermarkets.
When I published my report on supermarkets last year, it was abundantly clear to me that it would be impossible to take on the might of the supermarket sector, but it would be possible to attack selected departments of those stores by appealing to the consumer in a sophisticated way and through direct marketing. Marketing is crucial. We welcome any money that the Government put into helping farmers to market their produce, in particular the significant increase to £5 million, but I hope that farmers will be able to get at it. One farmer told me that he found it difficult to obtain and complete the forms. Often, money is made available through schemes, but it is still difficult to get it to those who need it.
Farmers markets offer the opportunity to win back consumers to local quality produce, but that will not be achieved through selling on trestle tables in village halls every other Saturday morning. The aim must be to create a small parade of shops or a viable street market selling genuine local produce, properly presented, complying with all the necessary food standards and health and safety regulations. That would be a real challenge and an alternative to the local supermarket. Meat from locally reared cattle; organic vegetables with the soil still on them, picked that day instead of sterilised, shiny, vacuum-packed produce that looks good but tastes of nothing; British pork that we know is British, not just packed in styrofoam here; and fresh eggs from hens kept in conditions that we know are acceptable could all be sold.
I suspect that local authorities will have to set up and run such markets, but they will need legislative support and, undoubtedly, some assistance with the capital requirements, but if we are to offer a real future to our smaller family farms and local producers of fruit and vegetables, we must provide the means for that to happen. Markets are too fragile and rely too much on individuals' good will to survive in the long term. Supermarkets will never provide such a market. Their distribution network is alien to that.
As the Minister said, the catering industry is a significant purchaser of fresh and processed food, and we need to win it over to the benefits of quality, 1155 British-produced food. The restaurant and pub food business is expanding rapidly and consumers should be able to know what food they are ordering. When ordering a steak, they should be able to ask its origin and demand information about where other food on the menu was grown or produced. Descriptions of food on menus must be accurate.
I have already called upon local authorities and Government Departments to insert clauses in their future contracts requiring them to source meat and meat products which meet the UK's standards for quality, hygiene and animal welfare. We cannot insist that they buy British because that would be anti-competitive in European terms, but we can demand that they source their products according to certain standards. That would boost domestic production and encourage European competitors to raise their standards if they wished to be considered for such contracts.
It is strange that, while there is a constant stream of cooking programmes on television and cookery books are always among the best sellers in the book lists, fewer and fewer people are cooking and eating at home. We need to look at what we are teaching in our schools. I hope that the Minister will have a word with the Secretary of State for Education and Employment. Food technology may sound far more important than cookery, but we need to remember what is important. Eating is supposed to be one of the pleasures of life, yet we confine food to a science subject, and seem to accept that stuffing a hamburger in one's mouth while walking down the road is all that we need to know about eating as an experience. It may be a matter for the long term, but we need to educate our children about food and how it is produced so that future scientific reports, from wherever they come, can inform the decisions of sensible people, not act as titbits to hungry tabloid scaremongers.
We must help farmers to develop additional forms of income, and tourism is an obvious one. Planning regulations are not helpful in developing farm tourism. We should be fighting for a fairer share of the rural development funding available under the common agricultural policy. At present, we receive 3 per cent. of the budget, the equivalent of Portugal, while France and Germany enjoy 16 per cent. each. We have fallen to 15th in terms of spending per hectare, so we receive £12 per hectare while countries such as Finland receive £175. That funding could support a number of new rural initiatives and bring real additional income to farmers, particularly those family farms under such enormous cash flow pressures. There are so many positive ways in which to look to the future of farming and change things so that crises, such as the one that we face, do not recur. We need long-term, positive solutions.
Before I finish, I must pause to reflect on the events of the past week. This week has been one of great negativity. The farming industry has faced more blows—things have only got worse, Minister. The news of sewage sludge in French feed seemed to add insult to injury to Britain's farmers. I make no bones about condemning those who have used this foodstuff, which is not only repugnant, but illegal. We need to be more honest about what is going on. It is not just France that is affected. Products from animals in contact with this feed are also being supplied by Belgium, the Netherlands and Germany.
1156 The EU has been far too timid. Where it issued recommendations to France that such producers should be stopped, it should have issued directives. The 15-day period within which to remove such feed from the food chain should not have been recommended but insisted upon. We should have been informed that the EU veterinary committee had condemned France for its lack of risk assessment. If we are to restore consumer confidence, we need to be more open in sharing information between all European Union states. We also need more rational consideration of the facts.
The French beef ban continues despite the fact that our beef has been cleared. We have invested money and brought up our standards. Before the BSE incident, the majority of our exports to France were beef on the bone from cows over 30 months old. We are not asking the French consumer to buy such beef again—our date-based export scheme rules out that possibility. The scaremongering must stop. The panic should be over. Patriotism is about supporting British agriculture, not alienating its customers.
I return to the point that I have been making all along: we need to be long-termist and positive. We cannot go around inciting trade wars and imposing unilateral bans. We need positive measures to promote the high standards that Britain's farmers already meet and we should do that by insisting on clear labelling of origin and content, fair inspection costs, direct marketing to consumers, encouragement for thriving sectors such as organic farming and new initiatives, aided by research and development for sectors such as the pig sector, to exploit emerging markets such as fast food and convenience meals.
Last week, we all agreed that time was of the essence. I remind the Minister that another seven days have elapsed, confidence is even lower and losses are mounting. If the Government are to act, they must certainly do so now.
§ Joan Ruddock (Lewisham, Deptford)
I congratulate my right hon. Friend the Minister on the sensible stance he has taken on the French beef crisis and the many helpful statements he has made today about support for farming.
Mine is an inner-city constituency where few people have direct experience of either farming methods or farm animals, yet in common with people throughout the country my constituents are deeply concerned about the food they eat. Anxiety about genetically modified foods is as strong in Lewisham, Deptford as it is elsewhere. On a recent official visit to my local Tesco store, I learned that it has the fourth-highest sales of organic food for that company in this country.
Concern about what we eat is primeval. Most people have an innate sense of what is good, but what exercises them now is their sense that, despite higher standards of hygiene and packaging, some forms of food production have become so unnatural as to create serious potential risks to human health. The catalogue of disasters that culminated in BSE has changed public perceptions for ever and resulted in an unprecedented exercise of consumer power.
The desire to avoid genetically modified food has given an enormous boost to organic produce and there has been a 40 per cent. increase in sales over the past year. 1157 The revelations on the feeding of French cattle will only increase that pressure for organic produce. If there is a crisis in agriculture, there is also great opportunity. That is why on Tuesday, with 11 all-party sponsors, I presented the Organic Food and Farming Targets Bill, which would place a duty on the Government to draw up targets to ensure that, by 2010, 30 per cent. of agricultural land and 20 per cent. of food consumed should be organic.
Given that only 1.5 per cent. of land is currently in organic production, those targets could appear to be wildly ambitious. They are not. The Bill was drafted by the Soil Association, which is the acknowledged expert in this field, as part of a coalition including Friends of the Earth, the Henry Doubleday Research Association, the Pesticides Trust, a number of unions and others. Furthermore, within a day of presenting the Bill, I was contacted, unsolicited, by Sainsbury, which pledged its support for the Bill, adding that organic food was its fastest-growing area with 500 lines already developed. It added, as is the case with all supermarkets:The company would like to offer its customers more British organic products but is unable to because of the shortfall in UK supplies.This morning, Waitrose pledged its support, saying it believes that it is in the best interests of consumers and agriculture to develop organic farming.
These market opportunities must, I believe, be underpinned by Government targets. I am sure that Ministers have taken note of the recommendations of the House of Lords inquiry report, "Organic Farming and the European Union". The report, which is otherwise very supportive of organic fanning, rejects targets as being too much outside the control of Governments. I trust that my hon. Friend the Parlimentary Secretary to the Ministry of Agriculture, Fisheries and Food will comment on that point when he replies to the debate, because I believe that it is mistaken. Some of the most important factors influencing the development of the sector are in the control of the Government, namely agricultural policy, the percentage of the total agri-environmental budget spent on organic farming and the amount spent on organic research and development.
On the external factors, I believe that we should expect the Department to make a considered judgment, as is done in other Departments when they are seeking to build a sector of the economy. We know that demand has increased 40 per cent. in the past year, and we can expect it to continue to grow, and that 70 per cent. of organic produce is being imported by suppliers. Countries as far afield as the United States and New Zealand are developing organic production specifically for the European market. European competitors have overtaken us: Austria already has 10 per cent. organic production, and the figure is 50 per cent. in certain sectors; Denmark has set a target of 50 per cent. by 2010; and even the newly created Welsh Assembly has a target of 10 per cent. by 2005.
This year alone, twice as many farmers registered for the Government's organic conversion scheme as could be funded by the whole of the 1998–99 and 1999–2000 budgets. I am absolutely delighted, as I know so many people throughout the country will be, that my right hon. Friend has confirmed today that an extra £10 million is to be put into the scheme while the review is under way. 1158 I encourage him to seek substantially more funding during that review, because I am certain that the money will run out as so many farmers are prepared to convert. We estimate that about £30 million is required to meet demand for the organic farming scheme and that about three times that amount would be needed to meet the targets in my Bill.
The Soil Association estimates that overall expenditure of about £150 million a year over 10 years would enable targets to be met for the UK to convert and have 30 per cent. of land in organic production. That represents a huge increase on current support but, if put into context, only a small sum. The annual cost of UK agriculture is put at about £3 billion, but if we apply joined-up Government thinking, for which we are becoming famous, the overall cost of conventional farming becomes much higher and the cost of support for organic farming conversion and maintenance becomes more attractive.
Conventional farming is one of the major sources of pesticide pollution of drinking water and its removal costs about £120 million a year. No Member of the House needs reminding that BSE costs us £4 billion and about 37,000 jobs. Increasingly, health problems are being traced to pesticide pollution and food poisoning incidents continue to cost millions every year. Antibiotic resistance and allergenicity are other major concerns to be weighed in the balance.
Organic farming methods and certification guarantee that no artificial pesticides, fertilizers, hormones or antibiotics are used in food production. The list of prohibited substances for animal feed under the organic rules makes chilling reading as someone somewhere—not only in France, but, I believe, in the United States—thinks these substances suitable for animal feed. The list includes:Materials which have been subject to solvent extraction …Animal by-products or manures … meat, offal, feather meals, poultry manure …Sawdustand urea. The list goes on, and it is horrifying.
I believe that the post-war consensus on farming and food production has broken down, and that a new framework for sustainable agriculture is long overdue. I also believe that the Government's reforms provide the basis for a much-needed way forward. The advantages of organic farming methods lie not only in the quality and safety of foods produced, but in better animal husbandry, reduced damage to the countryside and increased rural employment. I am confident that the Organic Food and Farming Targets Bill campaign will gather support throughout the country—and in the House, as early-day motion 902 is already. I trust that my right hon. and hon. Friends will continue to engage in their valued dialogue with the Soil Association and others, in order to explore every possible means of increasing organic production.
§ Mr. Stephen O'Brien (Eddisbury)
Thank you, Mr. Deputy Speaker, for giving me the opportunity to make my maiden speech in this important debate on agriculture. The subject is critical to vast numbers of my Eddisbury constituents whose lives are, directly or indirectly, wholly dependent on agriculture and its future.
First, let me pay a warm tribute to my predecessor Sir Alastair Goodlad, who represented Eddisbury from 1983, and before that, from February 1974, the old 1159 constituency of Northwich. Over 25 years, he served his constituents and the House with dedication and great distinction, most notably as Chief Whip in the last two years of the previous Administration—a testament to his skills, and to the significant contribution that he made as an effective parliamentarian.
I am in no doubt about the fact that Sir Alastair inspired the respect and affection of the House in the fullest measure. As he now prepares to take up his appointment as the United Kingdom's high commissioner in Canberra, I know that I am joined by all the many Members on both sides of the House who knew him well in wishing him and his wife, Lady Cecilia, every happiness and success in Australia as they serve our country on an even wider field.
The name Eddisbury is taken from Eddisbury hill near the famous Delamere forest. Eddisbury is, in fact, the name of the original Hundred which, in part, covered my constituency, the largest seat in area in Cheshire. Subject to the Library's verification, I believe that Eddisbury may be the only "live" seat that is exclusively named by its original Hundred. It is to be distinguished—I say this most emphatically, as a Member who has only just arrived—from the Chiltern Hundreds. I am proud to have the opportunity to serve all the constituents of this special seat.
The constituency, which is effectively south-west Cheshire, with its 67,000 electors mirrors in many ways the interests of the country as a whole. Nearly half its electors are in the town of Winsford, a third are in the rural villages and the remaining sixth are in the agricultural communities. For my family, it is a wonderful part of the country in which to live, and for me it has provided a welcome return to the county where I was raised and, at various times, educated.
Winsford is by far the largest town. It has expanded rapidly over the last four decades, and continues to expand, with many people coming to live there from the nearby large cities of Liverpool and Manchester. It is, rightly, a proud town, famous for its rock salt mines; and it is now dependent on many small and growing businesses.
I dare say that all Members arriving in the House hope that their experience on the outside, as it were, will be of some value to the House over time. Those of us who had the opportunity before entering the House of having industrial careers—in my case, centred on the built environment and transport sectors, here in mainland Britain, in many countries around the world and, most proudly, in Northern Ireland—and those of us who are now of the generation that is luckily unblighted by the travails of the 1960s and 1970s workplace, have come to know what makes prosperity, and what destroys it.
As I visit the many small and medium-sized businesses in my constituency—notably in Winsford—my own experience is reinforced. The prosperity of those businesses is primarily dependent on less government, less tax, less interference and, above all, a release from the stranglehold of regulations, choking as they do a business's ability to compete and an entrepreneur's incentive to take the risk, and sapping the morale of those who work in such businesses. It is a free framework that Winsford, its people and its enterprises need, and in which it will thrive.
Beyond coming to this House with an industrial background, there is no higher forum than this Chamber in which to nurture my passion for our country's 1160 constitution and its traditions. I believe that those traditions are worth conserving. Without, I hope, straying into controversy, is it not a sad irony that, having arrived in the Palace of Westminster, I found myself spending Tuesday night at the Bar of the House of Lords witnessing the closing of a 700-year chapter of its unique quality, character and inestimable service to the proud independence and wise government of our nation?
I am proud and humbled to be wearing my remembrance poppy as I speak for the first time in this House—the very House that is proof, above all other, of the freedom for which my great-grandfather and countless others fought and gave their lives in 1916 on the Flanders fields. The legacy of his sacrifice, and of all those who have died fighting for our country's liberty during this century, is the reason I—we—can be here today.
Let me now come to the subject of the debate. I recall vividly seeing, as a boy, the horrendous sights across the Cheshire plain—and the stench—of the burning pyres of foot-and-mouth diseased dairy herds. Our farmers have suffered grievously in the past, but is not today's farming crisis, the plight of farmers as individuals, and the plight of their families, on an altogether different and desperate scale? Knowledge that there is a crisis—and hon. Members on both sides of the House acknowledge that—is surely no substitute for an understanding of the current appalling plight of beef and sheep farmers, dairy and pig farmers, farmers with laying hens, arable farmers, hill farmers and all the ancillary businesses and activities that support farming. Only a true understanding will lead—urgently—to a reverse in the precipitous decline of the agriculture sector.
To put it most simply, what farmers in my constituency are crying out for is not special pleading. They want to be freed from red tape, burdensome regulation and form-filling. They want a level playing field in relation to their competitors, both from within the European Union and outside it, so that there is a prohibition against unfair imports of food that do not match the standards of rearing and processing that are legally expected of the farmers and processors in my constituency.
Eddisbury's farmers are surely typical of all British farmers whose commitment to, and attainment of, product quality is second to none. In relation to pig farming, I associate myself wholeheartedly with what was said by my hon. Friend the Member for North Norfolk (Mr. Prior), who led yesterday's Adjournment debate on the British pig industry. I have now read the report of the debate in Hansard, and apologise for not being present to hear it.
All families are affected by the crisis, including mine. My brother-in-law is a cattle and sheep hill farmer, on the most marginal land, on the very edge of the heathland of Dartmoor. I know of the intense pressure that he faces every day for the survival of his meagre livelihood to support his young family.
As I mentioned earlier, my constituency is characterised by its grasslands, farmed since time immemorial. I share with my hon. Friend the Member for North Shropshire (Mr. Paterson) the largest milk field in Europe. Is it not right for us to challenge the justice for those dairy farmers of the, at most, 18p a litre they receive for their milk at the farm gate—that litre is sold for 54p in Tarporley high street—while a litre of bottled water sells for 76p? Dairy farm incomes in my constituency have fallen by at least a third in cash terms in the last two years.
1161 On publication of the Monopolies and Mergers Commission report on milk in July this year, at the very beginning of my by-election campaign, the Government's acceptance of the argument that milk prices had been kept artificially high by the operation of Milk Marque beggared the belief of Eddisbury's dairy farmers. That is not the reality on the ground. I also believe that farmer-controlled milk co-operatives should be allowed to integrate vertically, as in the rest of Europe, by investing in processing facilities that enable value to be added to the basic product.
I am aware that the Government have rejected that argument, but in today's—not yesterday's—circumstances, I ask the Minister what assurances he can give dairy farmers in my constituency that he is listening to them, that he is reconsidering the actual circumstances of today, and that he is prepared to review urgently the Government's decision to deny a competitive opportunity to Milk Marque and, now, to its successor bodies.
Eddisbury typifies the danger of us all being over-sentimental about the countryside, which is a delicate balance between nature and the economy. The arguments that surround the countryside need also to be balanced, not hijacked by single-issue interest groups. If we are honest with ourselves, the countryside idyll—for visitors, an idyll it is—is rightly treasured. However, those idyllic rural areas are no accident; they are almost all influenced, if not wholly fashioned, by farmers. In using the term countryside, are we not in danger of slipping into the dreamworld of a chocolate-box picture?
The hard truth is that Eddisbury—like so many other areas of the United Kingdom, represented by hon. Members from all political parties—has a hard-nosed, hard-pressed rural economy, with cash flows, balance sheets, and profit and—now all too familiar—loss accounts. The health of Eddisbury's rural economy starts and finishes with farm incomes. If they are not viably sustained, the knock-on damage to our whole rural way of life—which is surely a very British way of life—will be untold.
I conclude by asking the Minister, in his reply, to say what assurances he can give to the farmers of Eddisbury now to alleviate their current plight.
§ Mr. Bob Blizzard (Waveney)
I am very pleased to follow the hon. Member for Eddisbury (Mr. O'Brien), and congratulate him on a very high-quality maiden speech. I congratulate him also on his by-election victory in July. He and I have at least one thing in common—we both have fairly obscure constituency names. My constituency was named after a river, whereas his was named after a hill. I had the pleasure of spending several days in his constituency just before he was elected, and hope that he has now settled in to a delightful area and made the transition from Chichester.
A Government's mettle is tested in times of crisis, when it is very important to keep a clear head, to show resolve and to stay calm. That is exactly what our Government are doing. Their actions in dealing with France, its beef and our beef ban have been exactly right. If a country wants to be taken seriously and to uphold its credentials as a constitutional democracy, it should stay 1162 within the law, and its decisions should have a sound basis. In the current case, that basis has to be found in science. Using the twin pillars of law and science, we shall achieve consistency. That is what the Government are about.
Today, the official Opposition are publicly advocating law-breaking and disregarding science. However, if we take a pick-and-mix approach, we shall only lose credibility. The official Opposition's proposals have not impressed the National Farmers Union, and have shown the official Opposition, in their actions, to be no better than the French. Moreover, in yesterday's Prime Minister's Question Time, I noted that the Leader of the Opposition lacked the spine to admit, in full public glare, that he was advocating law-breaking.
Why are we having a debate on such an issue? It all stems back to BSE. When that crisis started, the then Government showed us precisely how not to handle such an affair. They tried, first, sweeping the matter under the carpet. Secondly, they warned people that there might be a problem—then that there might not be a problem, and then that there probably was, but then again, and so on. All that did was to protract the crisis, permitting a long period in which so-called experts argued it out on the media, leading to uncertainty and a loss of confidence both in British farmers and in the previous Government. Eventually, when the revelations were made, the home beef market collapsed and a worldwide ban was imposed. It is no wonder that Conservative Members have today said that they do not like the official BSE inquiry.
Let us compare the previous Government's approach in addressing such issues with that of the current Government. When the current Government received evidence that there was a risk, albeit a small one, of eating beef on the bone, they acted swiftly and decisively. Beef sales were hardly dented, but a strong message was sent that the Government take food safety seriously. In my constituency, the main concern of the independent butchers who came to see me was that they should be able to cut beef off the bone in their own shops, as they have been able to do. I have had very few complaints about the Government's action on beef on the bone, other than from some fox hunters, who tried to link the issues of fox hunting and beef on the bone.
§ Mr. Blizzard
No, I cannot; I am sorry, but I have only 10 minutes.
The way in which the current Government have been acting in lifting the European and worldwide beef ban also contrasts starkly with the behaviour of the previous Government. The policy of non-co-operation in Europe not only isolated us, but failed. The policy was also exploited by anti-Europeans, who wanted the previous Government to adopt a position forcing them either to back down entirely, or to withdraw entirely from the European Union. That is a stark contrast with the skilful and successful negotiations conducted by my right hon. Friend the Agriculture Minister—who, but for the deviousness of the French, would have succeeded completely.
Nevertheless, without the European Union machinery, we would not be able to tackle France. Without that machinery, unilateral action could break out across 1163 Europe. Without it, we would have no rules to enforce, only chaos. The official Opposition have demonstrated that they want to encourage that chaos. The road that they want to take would involve more law-breaking and a trade war that would be in no one's interest.
Ever since I was elected to the House, Conservative Members have tried to portray themselves as the farmer's friends. However, farmers themselves know where Conservative policy on the beef ban would lead, and that that policy would not be in their interest. Farmers tell me that they are in favour of joining a single currency, although not at the current rate—whereas the Conservative party would completely rule out joining, for an arbitrary period. The whole drift of Conservative policy points to a withdrawal from the European Union—from which farmers, certainly in my part of the country, gain great benefits in markets and payments.
Conservative Members are so proud to have negotiated the so-called rebate. That is fine, but, in farming debates, they fail to say that British farmers suffered for that rebate, which makes it harder for British than for other European farmers to draw down agrimonetary compensation.
The official Opposition also pretend that farming problems started in May 1997, whereas, as we all know, the real start of our problems was the BSE crisis. The cost of some of the controls necessary to get us out of that crisis has been causing competition problems for our farmers. Conservative Members also do not say that pig welfare legislation was passed, albeit on a cross-party basis, by the previous Government. Furthermore, the United Kingdom has long had the structure—which my right hon. Friend the Agriculture Minister is now tackling—that enables supermarkets to enjoy huge mark-ups, but which means losses for farmers.
We should realise that farmers around the world are having problems. This summer, I spent some time in the United States, which we tend to think of as consisting of large, prosperous farms. However, that is not so. I met people from Iowa who told me of the dire straits in which farmers in that very agricultural state find themselves. Farmers in the United States are taking the same action as our farmers, encouraging people with slogans such as, "Eat the pork produced in our county". The United States also has a national campaign to promote "the other white meat"—although American consumers buy mostly beef and chicken, farmers there are promoting pork.
The most amazing thing I saw in my trip was a television programme, called "Farm Aid", devoted to the plight of the state's farmers. Just like "Children in Need" and other British aid appeals, the programme invited people to telephone and make a pledge, in this instance to help farmers. Although I do not know how many people made a pledge, or how many would do so in the United Kingdom if we had such a programme, it demonstrated that there are problems in the United States, as there are around the world.
As has already been said, the BSE problem has so far cost £4 billion, and the figure is rising. However, at least we have now installed the controls to give us an opportunity to make a return on the outlay. We have the safest and best-quality farm produce in the world, and we must capitalise on that fact in the home market. Today's announcement on new, clear labels will give us the opportunity to promote British farm produce and to promote a recovery.
1164 Today is a critical day. The integrity of the Scientific Steering Committee of the European Union is at stake, as is the European Union's machinery in its response. I hope that the French will see sense. People in this country are incensed. I am, and I have not been eating French food. I support the approach taken by my right hon. Friend the Minister, which is not inconsistent with the Government's. The Government should not break the law, but individuals can exercise consumer choice. We should not hide our feelings.
What the French are doing is in no one's best interest. It is not in the interests of the European Union and is condemned by everyone in this country. However, the French are doing what the Opposition would like us to do—take a pick-and-mix approach to Europe, full of opt-outs, inconsistencies and disregard for the law, that would undermine order and create chaos in Europe.
§ Mr. Peter Luff (Mid-Worcestershire)
It is a great privilege to be the first Conservative Member to be called to speak after the maiden speech by my hon. Friend the Member for Eddisbury (Mr. O'Brien). By any standards, it was a fine maiden speech and we all look back on our own and wish that we had done half or quarter as well as he did today.
I speak today as Chairman of the Select Committee on Agriculture and also as a Back Bencher. I hope that it will be clear when I am wearing which hat. I am sorry that we face a 10-minute rule, because as Chairman of the Committee I feel a certain obligation to touch on all the issues facing farming, much as the Minister did in his opening speech, but I do not have that opportunity. I also apologise in advance for the fact that I will not be able to give way or respond to interventions.
In the Agriculture Committee's first report of this Session, published in December, we highlighted the crisis in farming, which was then the worst since the 1930s and was, uniquely and disastrously, affecting all sectors of farming. Sad to say, our report published today can note only that the situation has not improved. The desperate downturn continues. For example, I attended a meeting in the Vale of Evesham last week, where I was told by one of the country's leading apple growers that he expects half of all English apple growers to go out of production next year. What a sad way for horticulture to celebrate the next millennium.
We all know—or should know—about the dramatic collapse in farm incomes of some 75 per cent. over two years. It cannot be said too often that the minimum wage applies only to farm workers, not to the farmers themselves. If it did, they would not be allowed to continue in business.
I am glad to say that the Agriculture Committee has had several opportunities to praise the Ministry in the past year. I had intended to speak at some length on those issues, but the 10-minute rule has got in the way. However, I can say that the Committee will welcome many of the things that the Minister had to say in his opening speech.
We should highlight the action that has been taken on bovine tuberculosis. The Committee was impressed by the resolve shown by MAFF in taking forward the Krebs report and in seeking a rational, scientific basis on which to build a policy for the control of TB in cattle. I have to 1165 say to the animal rights lobby that if badgers have rights, so do cows. They have a right to be protected from bovine TB and a premature death. Farmers also have rights—the right to a policy, based on science, that will reduce or possibly eliminate the scourge of bovine TB, which continues to increase day by day.
It was not an easy decision for Ministers to accept the Krebs recommendations and we congratulate them on doing so. We offer our continued support to Baroness Hayman, who is now the Minister in charge of that policy area, in the difficult task of implementing the field trials. A democratically elected Government pursuing the right policy, as the Government are doing, must prevail over the violent protests of misguided extremists.
The Agriculture Committee has also found much common ground with the Minister on his ambitions for CAP reform. The Agenda 2000 negotiations earlier this year presented an opportunity to reform the CAP to create a system more appropriate to the needs of farmers and consumers and taxpayers of the 21st century, and one capable of withstanding the World Trade Organisation negotiations, which are the most important issue for British agriculture's long-term future today. Sadly, the opportunity was lost. The protectionist instincts of certain other EU states overcame the more reformist views of others, including the Minister and the European Commission itself. In my judgment, the action by Jacques Chirac in Berlin was much more damaging to the long-term future of British and European farming than France's illegal folly over British beef exports. We will live to regret Mr. Chirac's behaviour for much longer. It was particularly disappointing to see more milk quota going to the other side of the Irish sea, while none came here. Dairy farmers are saddened by that.
The Committee's current inquiry is into the marketing of milk. I see that inquiry as being important not only to dairy farmers and the dairy industry, but to the whole of farming. Perhaps unwittingly—and we will discover the truth when the Minister appears before us in a few weeks' time—the Government have sent a message to farmers that they will not tolerate vertically integrated farmer-owned co-operatives on the same scale as seen in the rest of Europe and, indeed, the world. I hope that the whole House agrees—and the Minister said as much in the Chamber earlier this week—that the future of farming lies in much closer co-operation and in helping farmers to capture more of the added value that currently goes to other participants in the chain.
Talking of the need for co-operation leads me logically to pigs. Much has been said, rightly, about the pig industry today and we all welcome the Minister's remarks today. However, I do not know whether his proposals will be sufficient to address the crisis in that industry. The pig industry needs to co-operate more, because it is too fragmented and that has been one source of its difficulties.
A year ago, we were just beginning our inquiry into the pig industry. In January, we published our report and the Minister will not need to be reminded that we were not entirely happy with the Government's initial response to that report. Unusually, we published a special report criticising that response, but if he had come forward then with the proposals he made today, we would have been much happier.
1166 Today, the Agriculture Committee published a report about MAFF itself. There is perhaps some poetic justice in the fact that MAFF is in considerable financial difficulties of its own. I am still worried that further cuts in MAFF's programmes are a real possibility. Will the extra money announced today for at least two specific programmes come from new money from the Treasury, not from MAFF's current budget?
§ Mr. Luff
I am relieved on that score. In our report, we highlight the fact that cutting research and development expenditure seems a perverse reaction when we are fighting to increase British competitiveness, maintain food safety and reduce animal disease. I am concerned by the rumours of the break-up of MAFF, or at least the transfer of its functions to other Departments. We need a strong voice for farming, especially in order to address the WTO negotiations effectively.
I draw the House's attention to paragraph 17 of our report, which deals with the Ministry's attitude to competitiveness. We recommend an audit of regulatory activity, and I came under some pressure from Labour Members to include that recommendation. It is essential that we regulate carefully the burdens we impose on British agriculture, and the Committee is not convinced that MAFF has always been effective in doing so.
I must address the subject of beef exports. I have talked to several farmers in my area recently and they are not very keen on the idea of a trade war. They say simply that the French are better at them than we are and that we have a lot to lose. We must prevent the import of products only when we are on the surest scientific ground. A trade war could undermine our claim to be behaving with absolute integrity in the beef dispute. If France is to be made to play by the rules, we must do so too. Trade wars are also likely to be counterproductive. If the French fanners took to blockading other British exports, such as sheep, the effect could be disastrous for British farmers, as my right hon. Friend the Member for Skipton and Ripon (Mr. Curry) made clear.
I think that the Government could have done a bit more. I know that the date-based export scheme is about de-boned beef, but Lionel Jospin said on television that the ban on beef on the bone was one reason for the behaviour of the French. Ministers must accept that it is a real factor in the current dispute.
If the Minister has scientific advice that the ban on beef on the bone can safely be lifted, I wonder whether he is on safe legal ground in continuing it. Devolution arguments have also been advanced, but devolution is about the differences between countries. That is one reason why I was worried about it in the United Kingdom context, but in this respect I say, "Vive la différence."
My second complaint is about the Government's confused response to the crisis. The word "confusion" has appeared in many press reports describing the Government's response. My hon. Friend the Member for South Suffolk (Mr. Yeo) dealt with that in his opening remarks, so I shall not labour the point now, save to say that it is regrettable that there has not been greater clarity.
It is important to emphasise that the economic significance of the beef export ban must not be overstated. Of course we must lift it and of course the French are 1167 wrong, but the Ministry has set a very modest target for the recovery in beef exports. There is a risk that the Franco-Britannic squabble could obscure the truth, which is that farming faces much more fundamental problems than this little local difficulty. The Minister is optimistic about the matter, and I hope that events will bear him out. I look forward to discussing that and other matters with the Minister when he comes before the Agriculture Committee the week after next to discuss the crisis in the livestock industry.
A great deal more should be done to safeguard the future of British farming. It needs a more strategic approach than has been managed so far. That approach should be based on securing added value for the farmer, developing new skills in farmers, freeing farmers from production-related support, maintaining competitiveness by avoiding regulation, moving away from commodities and into brands, encouraging co-operation among farmers, and on empowering consumers to make better informed choices. That is the sort of agenda that needs to be developed for farming.
I shall conclude with a more partisan note. The one thing that we do not need to do is ban fox hunting. Not only would that be bad for the rural economy, the environment and the social lives of farmers, it would be bad for farmers themselves. The Ministry rightly encouraged farmers earlier this year to use hunt kennels to get rid of their fallen stock. My own hunt kennels have experienced an increase of 100 per cent. in the culling that they are undertaking. It is regrettable that farmers, who are faced with so many great problems, should have to cope with that added insult.
§ Mr. Desmond Browne (Kilmarnock and Loudoun)
I, too, congratulate the hon. Member for Eddisbury (Mr. O'Brien) on his by-election victory and on a very fluent maiden speech. Like my hon. Friend the Member for Waveney (Mr. Blizzard), I also visited that constituency for a couple of days before the by-election. It is an interesting part of the world, and there is a remarkable coincidence between the geography of Eddisbury and that of my constituency in Ayrshire. I listened with some care to the hon. Gentleman's remarks, and was not surprised to realise that his constituency and mine have similar rural economies. The people of Eddisbury are friendly and welcoming, and I am sure that the hon. Gentleman will enjoy his time there. I look forward to many more interesting contributions to our proceedings.
I shall keep my contribution brief. I trust that Opposition Members will be able to stand yet another Scottish voice in the debate. I have become used to the little Englander mentality of some Conservative Members, but I was shocked at the nadir that that mentality reached today, when a Scot who represents an English constituency—the hon. Member for North Wiltshire (Mr. Gray)—sought to undermine another hon. Member's contribution on the basis of the geographical origin of the person who made it rather than on its content.
I welcome the announcements that my right hon. Friend the Minister made today with regard to the agriculture industry, as will many farmers in my constituency. I also congratulate him on the law-abiding stance that he has adopted with regard to the beef dispute. The Opposition 1168 spokesman, the hon. Member for South Suffolk (Mr. Yeo), was asked for legal advice by the hon. Member for Vale of York (Miss McIntosh). Remarkably, he was unable to cite the legal advice that apparently supported his position. If I understood correctly what the hon. Gentleman told the House, he said that he had received no such legal advice and that no such advice existed to support the position adopted by the those on Opposition Front Bench.
In any event, I know that the approach adopted by my right hon. Friend the Minister enjoys great support outside the House. Only yesterday, I had one of my regular conversations with a certain constituent of mine. He was at his home back in Scotland, and we were discussing the Government's handling of the current beef crisis. I asked him what his views were on the confrontational approach advocated by the Opposition.
My constituent said to me that the last thing that we needed was a trade war banning any French food or livestock products. He recognised that that would be illegal, and said that it would inevitably lead to reciprocal action. As other hon. Members have pointed out, the French are better at such action than we are.
My constituent is a knowledgeable individual, and said that a ban would do no good. Scotland exports about £3 billion of manufactured goods to France each year. A total of £316 million of that amount is accounted for by food and drink exports, and two thirds of that consists of exports of whisky. He added that it was obvious that Scotland and its agricultural economy needed this trade, and that any move to jeopardise it would be madness. That constituent is Ian Kerr of Woodhead farm. He is particularly knowledgeable about agriculture because he is the milk committee chairman for the Scottish National Farmers Union.
As my hon. Friend the Member for Dumfries (Mr. Brown) said, we cannot overestimate the importance of agriculture to the Scottish economy. In fact, about one job in 10 in Scotland relies on agriculture. The landscape, traditions and rural way of life—[Interruption.] I wish that the hon. Member for North Wiltshire would contain himself instead of making observations from his sedentary position. Perhaps if he listens, he will find out what this has to do with this place. The landscape, traditions and rural way of life are sustained by our agriculture industry. Agriculture has shaped and managed the Scottish environment, which in turn is the bedrock of a £2.5 billion Scottish tourism industry.
Farming is important to the economy of my constituency. Dairy farming alone contributes about £58 million a year to the Kilmarnock and Loudoun economy. Our 200 dairy farmers produce about 10 per cent. of the total Scottish dairy production. Over the past few years—stretching back beyond the tenure of the current Government—they have had it hard. There were a few good years because of pricing, but they have had it hard, as they knew they would. Dairy farmers have suffered a further milk price reduction of about 8p a litre, a decline in the value of their animals when they are sold off at the end of their productive life, and a fall in the value of calves to nil from £120 per beast in 1996.
The cumulative effect is to reduce total farm income in my constituency, by £12 million, which also removes that money from the local economy. Farmers short of cash have no money for repairs, and that has a detrimental 1169 effect on all other rural businesses. One agricultural engineer in my constituency has seen his annual turnover drop from £600,000 to £100,000 in just three years. The loss of secondary business has particularly affected the town of Galston and the villages of Newmilns and Dunlop.
When farmers have money they invest it, and that is obvious when one drives through the rural environment. In Kilmarnock and Loudoun, it is obvious that dairy farmers are no longer able to invest in the upkeep of their farms. The storm damage of last year remains unrepaired. Many farmers had made savings and were uninsured.
The countryside environment is deteriorating. The countryside premium scheme was introduced to help farmers—for example, to fence off ditches and make other environmental improvements to the countryside. Many local farmers considered the scheme and were attracted to it, but, as it involved a considerable capital outlay, shied away from it.
Dunlop is a typical example of a village significantly affected by the slump in agriculture. The major employer in the town, an agricultural contractor, is doing so badly that few jobs remain. That affects not only the economy of Dunlop but the whole life of the village.
Behind every one of these facts are individuals and families who are struggling to cope. I meet these farmers and their families regularly. They are not unappreciative of what the Government and the Scottish Executive have done for them. The additional aid that has been secured for them has been welcome, and despite the fact that dairy farmers still face immense problems, they do not hark back to the past. They realise that they live in changed circumstances, and they welcome the challenge that that brings. They want to work with the Government in creating the environment that will allow them a sustainable future. In the context of both Scotland and the United Kingdom, they tell me continually that it is a change to have Ministers who listen to them and respond to what they say. Tory Members may shake their heads at that, but they are welcome to come with me to meetings with farmers who tell me those things.
Dairy farmers know that circumstances have changed. Perhaps they could have coped with a strong pound, and perhaps they could have coped with a market dominated by strong buyers who effectively dictate the price, whatever the Competition Commission may say about the sale of milk; but they find it impossible to live with a combination of the two.
On behalf of those dairy farmers, I ask the Minister to hear the following points. First, if the exchange rate remains as it is until the end of the year, the dairy sector will be eligible for agrimonetary compensation thereafter. The dairy farming community expects that the Minister, who has a full appreciation of their current plight, will, when the time is right, ensure that they receive every penny of their entitlement.
Secondly, since the calf-processing aid scheme ended, dairy farmers in Kilmarnock and Loudoun have been left with calves and no market for them. Ironically, the scheme itself killed off that market. However, there are potential markets in the east of Scotland and in England where there are farms that have the ability to rear those calves. There needs to be some development of this 1170 market. The farmers have spoken to the Meat and Livestock Commission, and they want assistance with that.
Finally, Milk Marque, in setting milk prices for England and Wales, effectively set the floor price for milk in Scotland. In response to the Government's acceptance of the Competition Commission's findings in the inquiry into the marketing of milk, Milk Marque intends voluntarily to split into three regional co-operatives. There is real concern among dairy farmers in my constituency that, without Government supervision of the process of disaggregation, dominant buyers will exploit their already powerful position and force further reductions in the price of milk for the producer.
With that transition from a unified body to three regional co-operatives, dairy farmers in my constituency are concerned that the consequent level of uncertainty will further weaken the price of milk for producers. I am sure that the Minister is aware of those concerns and intends to keep a close eye on the process. I would ask him to do so on behalf of the farmers in my constituency.
§ 5 pm
§ Mr. John Townend (East Yorkshire)
Everyone accepts that agriculture is in the worst state that it has been in for many years, certainly since I entered Parliament. The big difference this time is that, previously, when one sector has been on the floor, another has been profitable; at the moment, practically nothing is profitable.
My constituency is one of the major pig producing areas of the United Kingdom and is therefore suffering greatly. Even the most efficient and successful producers are losing tens of thousands of pounds every week. Unless action is taken immediately, there will be a large drop in the size of the UK herd, many pig men will go bankrupt and out of business, and the UK will become more dependent on European imports, which is what the continentals want.
The major problem is that, even though our best pig farmers are the most efficient in the world, they cannot compete because there is not a level playing field. The major responsibility for that lies with politicians of all parties. They have become obsessed with hygiene and welfare standards and have imposed a greater burden on our industry than is carried by our EU competitors.
First, sow stalls and tethers have been banned in this country, but they have not yet been banned anywhere else in Europe. I talked out the original Bill introduced by my hon. Friend the Member for Boston and Skegness (Sir R. Body) to implement that measure, but the Government of the day, with the unanimous support of those in opposition, brought it back through regulations. At the time, I said that implementation should be deferred until our major competitors had similar regulations or there would be disaster for the industry, but no one listened.
Secondly, as colleagues have mentioned, since the BSE crisis, hygiene costs—especially in abattoirs—have been greater here than elsewhere. If we want higher standards than the rest of the world, we should not put our industries in jeopardy but pay the cost out of general taxation.
Thirdly, our producers are not allowed to castrate, so the demand for large pigs has to be met by imports. Fourthly, our producers cannot use bonemeal, whereas 1171 every other country in the Community can. In addition, our producers have had to carry the burden of the Government's annual penal increases in the tax on fuel, which has put up their costs.
It is time for Government action if we are to prevent the destruction of a large part of our industry. It is wrong that pigmeat, especially bacon, that has been produced under food safety and animal welfare regulations that would make it illegal here should be allowed to be imported into this country,. We should ban all imports that do not come up to the standards that we require. Then our competitors' costs would rise to our level and the crisis would be over.
The Government will say that that is against European Union rules, but I say, "Tell that to the French." We seem to be the only suckers in Europe who put the rules before our national interests. We have not started a trade war; it is the French who are breaking the regulations. No one suggests that because they are doing so they will leave the EU. Labour Members have the nerve to say that what my hon. Friend the Member for South Suffolk (Mr. Yeo) said from the Conservative Front Bench would result in our leaving the EU—that is absolute nonsense.
The Government say that we have, at enormous expense, dealt with the BSE problem—I think that a figure of £4.5 billion was mentioned—and had the ban lifted by the EU and that we must build confidence in our exports. We would all agree with that. But, as has been pointed out by other colleagues, how can we expect the continentals to be convinced that British beef is safe if it is illegal for us to buy beef on the bone, yet it is legal to buy French beef produced from animals that have been fed sewage?
I understand that the English scientific advisers to MAFF say that there is now no health reason for the ban to continue, but they cannot get the agreement of the Welsh and Scottish. That is the result of devolution. It is improper that the English beef industry should be penalised because of what officials in Scotland and Wales think.
The French and German refusal to lift the ban is unacceptable. What do the Government do in retaliation? Nothing. They say that we must obey all the rules and leave it to the European Union to sort out. It will be most interesting to hear what the Government will say if the EU does not sort it out today. While the French prevaricate and keep our beef out, our export market is unable to recover.
We must admit that the French are dishonest about agriculture. In France there have been lots of cases of BSE, or, as French farmers call it, the JCB disease. When they identify a cow with BSE, they bring in a JCB, dig a big hole, bury the cow and do not report the case. Now we find that they have been introducing human excrement into the animal food chain. This revolting practice—I cannot think of a better word—could well carry with it health risks. Until we are certain of the implications, we should use this opportunity, which the French have given us, to ban the import of French meat.
Of course, the Prime Minister has refused to act in this way to help our agriculture industry. Why? Because his priority is to be a good European and popular in Brussels. He has not even got the guts to back the Minister of Agriculture, Fisheries and Food who is personally boycotting French produce. Unlike my Front-Bench 1172 colleague, I congratulate the Minister on making this stand on behalf of British farming and British interests. I am doing the same, although it hurts me greatly not to drink French wine at home.
Why does the Prime Minister not do the same? Why does the whole Cabinet not set an example to the British people? It is because the Prime Minister no longer sees himself as a Briton; he sees himself as a federal European. After devolution for Scotland and Wales, and once we have joined the single currency and he has made sure that this country is one of many provinces of a federal Europe, his ambition is to be President Blair of Europe. He calls Conservative Members extremists, but he is the extremist—the extreme European' who ignores the interests of British agriculture. To curry favour with Europe at our expense will cost him dear. The more he acts like this, the more likely it is that he will lose the referendum on the euro.
Finally, the French are taking illegal action against British beef. The retaliatory boycott by the British public of French produce is legal. We, as individuals, are simply exercising our freedom of choice. The subsequent retaliation by the French against that legal action—they are stopping British lorries illegally and examining their loads—is unacceptable. The French police, as we saw on television, stood by and did nothing. When reporters asked the French policemen whether this action was not illegal, they said, "Je ne sais pas." Do we really want to be part of a federal Europe with a federal police force which acts like that?
In the latest report, we learn that the French will offer a so-called compromise today. There will be a fudge. It will not benefit British agriculture one iota. It will increase the burden on British farmers, with more restrictions and tests, and at the same time it will not enable us to rebuild our beef export trade to France. It is all aimed at saving the Prime Minister's face and keeping alive his dream of bouncing us into the euro, to show that we will be part of the great European drive to political union.
My message to the Prime Minister tonight is, "When are you going to be like the French and start fighting for our interests rather than European interests?" My message to the British public is, "Continue to support our farmers and continue to boycott French produce" because, whatever happens, the French public will continue for many years to boycott British beef.
§ Mr. Mark Todd (South Derbyshire)
Naturally, this debate has been dominated by consideration of current events. I do not wish to dwell long on them, but it would be wrong not to comment briefly. I am clear that, in our dispute with the French, we have law and science on our side. Peremptory, ill-conceived bans will only threaten our £10 billion-worth of exports of food and drink to the European Union.
I have written to the Minister urging assistance to deal with the extra burdens facing the pig sector on offal disposal. I believe that the steps that he has announced today of further investigating the potential for lifting part of the ban through the Spongiform Encephalopathy Advisory Council is commendable. However, yesterday and the day before, I had the pleasure of attending events hosted by the National Farmers Union and the Meat and 1173 Livestock Commission, at which the tone was forward-looking about the future of British food and farming.
Several key factors were rightly addressed. The first was the critical importance of quality of produce. The second was the ability to supply consistently to meet a market need. The third was the need to improve the range of produce available from British farms. It is alarming to read in today's Financial Times that Whitbread's Beefeater chain claims that it can source only 50 per cent. of its beef requirements from British producers and has to supplement the balance from Argentinian suppliers. It worries me, bearing in mind the beef crisis here, that we are not able to meet the demand of a key retailer.
A representative of Geest who spoke at yesterday's NFU event drew attention to the fact that its garlic requirements were not being met by British suppliers and that it had to import. We have heard the story of organic produce. The purchaser from Sainsbury's made it clear that 70 per cent. of the organic produce that he was in charge of purchasing came from foreign sources. Clearly, we must improve the range of produce available from our farming communities to meet customer demand.
Another issue is the behaviour and performance of our processing sector. We have to search for greater efficiency. I will not repeat the points that I made in last week's debate about the dairy sector, but they could be applied equally to other parts of our processed foods sector. There is evidence that we have an elongated supply chain that is relatively inefficient compared to that of many of our competitors. We have to integrate that supply chain better. I commend the initiative that my right hon. Friend the Minister has made so far to examine the totality of the food supply chain rather than purely the farm end of the problem.
In retailing, we need to meet the need for clear labelling. The purpose of yesterday's conference was to seek a clear branding of British food. I commend that initiative. It is right that suppliers in all parts of the food chain are undertaking it jointly rather than relying on the Government to put it together. The initiative should be producer and retailer led and focused on customer need, not bureaucracy.
We need to see more product development in the retail sector, too. It is clear that the customers of retailers are moving ahead of the provision that is available in the shops. We continue to find shortages in some areas, possibly due to a failure adequately to identify customer trends. Better quality presentation in shops of goods from British suppliers is of critical importance. Clarity of branding is most important; items should be consistently presented so that it is clear where they come from and what quality can be expected. We should build on the strengths of some of our regional brands—another issue that I touched on during last week's debate, so I will not expand the point today.
The importance of partnership was another key point that came through at the conference. I have never run a business in which I thought it a good idea to abuse my customers, yet the food sector adopts a curious approach, in which mutual abuse between those involved in different parts of the food chain is still a regular feature—one that is repeated and amplified in this House. I have never found such an approach to be helpful.
1174 There are faults in the retail sector—the supermarkets have much to answer for as a result of the way in which they have dominated the food chain. I cite a voice that is relatively familiar to Members of this House:We (The multiple retailing) industry has also lost valuable friends, including the British farmer. They are in crisis and we have to say—what have we really done to help? The bitter truth is not a lot.That was said by the hon. Member for Tunbridge Wells (Mr. Norman), who also holds a position with Asda.
There is room for significant improvement in retailer performance, but that can best be driven by partnership with the producer sector. Specifically, retailers must lead in product development—in developing strong, meaningful brands. They should consider partnership funding on organic conversion, and not merely guaranteed longer contracts, which they have—admittedly—offered to those seeking conversion. There is no reason that they should not directly fund additional assistance. Government must facilitate such partnerships, and ensure that we place no greater burdens on those sectors than do our competitors. I dwelt at length on that point in last week's debate; I shall say no more about it now.
MAFF should ensure that the food sector is fully represented in regional initiatives. I shall dwell on one feature of the Select Committee report—the Chairman of the Committee, the hon. Member for Mid-Worcestershire (Mr. Luff), has already spoken eloquently on much of its content. From my experience in the east midlands and from comments that I have received from elsewhere, it is clear that MAFF has not fully participated in the development of economic strategies in the relevant regions. Indeed, the Committee's inquiry and our questioning of the Permanent Secretary revealed that MAFF conceded that point. That problem must be addressed. The food sector is a critically important part of the economic base of every region of this country—especially my own. To miss the opportunity to develop that important sector and to integrate it more with the performance of other related industries is foolhardy in the extreme. We should not continue to miss that opportunity.
Farming and food have a great future in Britain, although it is hard to say that at present. However, I believe that some of the earlier contributions to the debate would delay the delivery of that future through their narrow-minded protectionism—we should avoid that.
§ Mr. James Cran (Beverley and Holderness)
I am grateful to be called to speak in the debate, in view of the crisis in farming, especially in the pig sector. That crisis is acute in my constituency—particularly in Holderness. The Minister knows that area well; he knows what I shall be talking about. I am deeply disappointed by this afternoon's announcement on the pig sector. I know perfectly well that pig farmers in my constituency will echo my disappointment when I meet them tomorrow.
The Minister told us that he was aware of the problems of agriculture. He is an honourable man and I believe that he is aware of them—of that there is no question. However, this afternoon, he tried to anaesthetise the House; that was the aim of the exercise. As far as I could tell, he agreed with everyone. In effect, he said, "More needs to be done; I am looking at everything; there will be less bureaucracy; I have teams looking into this, 1175 that and the next thing; and arching over all that is Agenda 2000, which, tomorrow—somewhere down the line—will solve all the problems of British agriculture."
The problem is that the situation is getting worse. A pig farmer in my constituency, Mrs. Dianne Brockhurst of Burstwick, anticipated the Minister's speech today when she wrote in a letter to me:Nick Brown is certainly full of 'tea and sympathy' type platitudes but no solid action has been forthcoming. I now wonder if this Government is quite happy to see us 'go to the wall' rather than 'ruffle any feathers' abroad.Whatever one thinks about the latter remark—I may agree or disagree—my constituent is undoubtedly correct: the Minister has given the impression to fanners in my constituency and throughout the United Kingdom that his approach is all "tea and sympathy". If I have one message, it is that that simply will not do. Solutions must be actioned today—that is how serious my pig farmers' problems are. Even as I speak, farmers are going out of business. The Minister's words this afternoon rang hollow and I am disappointed. It makes one almost cry to hear the sort of complacency to which we have been forced to listen this afternoon. It is simply shocking.
I welcome the Minister's comments about labelling, but we had better look at the small print because the devil is in the detail. Apart from labelling, I fear that the package will be virtually worthless to my constituents. If I have got it wrong, I look forward to an explanation, in the winding-up speeches, of why I am wrong. Although £5 million is welcome—I do not deny that—it will not help any of my constituents now.
The Minister may recognise the depth of the agricultural recession, but I fear that he is doing absolutely nothing to solve it—at least, not in my neck of the woods. I keep in close touch with the NFU in east Yorkshire and I asked it to report on the current situation. I will not quote from its response extensively, but I must put some of it on the record because I suspect that non-farmers do not understand what is happening in the British countryside—especially in east Yorkshire. Farmers in east Yorkshire are suffering theWorst Agricultural Depression for decades.They are not my words but those of the NFU, which clearly I must heed. I read that, on Wednesday last week at the Beverley market, calves were sold for £1 a piece—to be fair, two were sold for £2 and another was sold for £3. [Interruption.] I do not know about you, Mr. Deputy Speaker, but I do not find that amusing—I do not think that any hon. Member should—particularly when I recall that calves were sold for £100 each a couple of years ago. Is it understood in this country—especially by the Minister—that the tags on calves are worth more than the calves? The Minister must know that. We must also take account of rearing costs, auctioneers' costs and other associated costs.
The price of milk has dropped from 24p or 25p a litre to 17p or 18p a litre. How can people make money under those circumstances? They cannot. It is no use the Minister of Agriculture and his team saying, "We understand it, but we are prisoners." Farmers will not put up with it for long. The NFU and farmers in Yorkshire and Holderness are not making political points: they are telling it like it is. It is a tragedy for the people whom I represent. They are not militants; they do not march through the streets—at least, not until recently. They are 1176 just hard-working, honest people, who ask for little and get nothing. The Minister knows that the pig sector gets nothing, and, in the circumstances, that is simply appalling.
All those farmers ask is that they can make a little profit, but they are not making anything. There is not a lot of profit in the land. I can see the Minister nodding his acceptance of that. I fear that the Government are transforming those ordinary, decent people into a pack of militants, and that is tragic. They are beginning to say to themselves that they must follow the French example of direct action. Whether or not I agree with such action is neither here nor there.
So desperate are some of those farmers that, yesterday, outside the House, I saw the truly pathetic sight of pig farmers hauling two sows up the middle of the road in an effort to get publicity for their parlous situation. They have found it exceedingly difficult to get publicity, or be listened to, and that makes it all the worse that the Government have failed to recognise their dire straits.
My problem is how I can convince the Minister of their case. I have concluded that he will not listen to me. He would say that I am an Opposition Member and obviously I have a political axe to grind. I shall not do that, but, even at this late stage, I shall try to convince the Minister that what he has done today is totally inadequate, by quoting from a letter that I have received. I could have brought with me 200 or 300 such letters, but I have brought just a few.
A letter from Mr. Mewburn, the managing director of Dacre Pigs Ltd. in Brandesburton in my constituency, states:Two years ago my son and I undertook a redevelopment programme to enable us to comply with the stalls and tether ban and to produce efficiently without the use of in-feed antibiotic medication.That cost a cool £480,000. A swift intake of break is needed. As far as I can tell from what he has told me and from what we have heard this afternoon, that is money down the Swannee.
Mr. Mewburn says that happily,we are not dependent on our pig business for our livelihood, for had we been so, we would now be on the verge of bankruptcy.As it is, they are now faced with deciding whether they should continue and sustain losses. Why should they continue? As it is, Mr. Mewburn will probably decide to get out of the pig industry, and the business will effectively be exported to another country. Where, in heaven's name, is the sense in that?
Mr. Mewburn ends by saying:The only financial assistance I would request would be the removal of the so called 'BSE' cost imposed on pig producers.How small a request to make in such dire circumstances. As I said, I have many more letters from which I could have quoted.
I repeat that the problems in my constituency are happening now. Bankruptcy is happening now; unsustainable losses are happening now, and something must be done now.
§ Mr. Alan Hurst (Braintree)
It is a pleasure to follow the eloquent speech of the hon. Member for Beverley and Holderness (Mr. Cran), whose remarks have done a good service to his constituents.
1177 I do not intend—apparently it is against the rules of the House not to do so—to refer to France. Others have done so, and the matter has been well and truly covered. I shall stick to my plan, notwithstanding the words of wisdom uttered by the hon. Member for Mid-Worcestershire (Mr. Luff), who, in a speech that covered every subject in the "Encyclopaedia Britannica", managed to finish on the subject of fox hunting, which I shall also avoid.
I want to say a few words about milk, which has already been referred to in other speeches. My hon. Friend the Member for Kilmarnock and Loudoun (Mr. Browne), in particular, addressed his remarks to that area of farming. I have always been at a loss to understand the illogical motives behind the breaking-up of the Milk Marketing Board in 1994. I know that it might be argued that we jumped before we were pushed, but I suspect that the push was quite a way off when we decided to jump. I can trace—at least in my own mind—many of the origins of the plight of dairy farmers to that decision in 1994.
From the very beginning, Milk Marque was hobbled. In what is supposedly a competitive world, it was running with both legs tied together. The restrictions and obligations placed on it in effect made it uncompetitive in the world that it faced. The first such restriction, which is beyond my ken, is that milk farmers were not allowed to process the product. As several hon. Members have said, the secret to successful marketing and business is to add value to the product; to be able to take the product through the chain so that maximum profit can be gained from it. All that milk farmers can do is sell the raw product, leaving others to take the added value and profit.
Then, there is a restriction that could be from a satire: milk farmers were not allowed collectively to advertise the product. That was almost creating the free-market economy of the Soviet Union. Milk farmers could not say, "Drink a pint of milk a day", or "What a lot of bottle", or even present dancing milk bottles to the public to illustrate their sound product.
The annual advertising budget for milk of £30 million a year in today's terms came to an end—when consumption was falling and dairy companies were amalgamating, gaining larger and larger shares of the market. Farmers were cherry-picked as the dairy companies sold them initial premiums in order to push Milk Marque into a weaker and weaker Celtic twilight—if I dare say that in the presence of Celtic Members. Milk Marque was pushed into the remoter parts of the country, where, naturally, transportation charges were greater and economies of running operations were smaller. As a result, dairy operators have gained the best markets and Milk Marque has increasingly been pushed into areas where it is difficult to compete.
Amazingly, at the same time, a Monopolies and Mergers Commission report stated that Milk Marque was undertaking uncompetitive practices. It would be reasonable to conclude that, since the inception of Milk Marque, dairy companies have been gunning for it and looking for an opportunity to hobble it even further. If we end up with weakened co-operatives competing against one another, and if for some amazing reason they do not have the opportunity to establish a processing wing, the dairy companies will corner the whole market.
1178 My hon. Friend the Member for South Derbyshire (Mr. Todd) takes new Labour policy a little too far for my taste in the abolition of a conflict theory of economics. We do not want to go too far into such a theory, although we readily understand that diary companies, supermarkets and producers do not necessarily have the same interest when it comes to who makes the profit in a declining market.
I welcome today's announcement that, in a ballot, farmers voted for corporate, generic advertising—selling the product as a whole. They will of course have to pay for that themselves; the money will come from their own contributions, which I suspect will be hard to find. I welcome my right hon. the Minister's statement that he will facilitate progress in such advertising. I am a little concerned that the dairy companies 50 per cent. contribution is voluntary and will need to be worked out. I am sure that my right hon. Friend will put all good pressure on them to ensure that they co-operate in a campaign, even though the budget will be only 25 per cent. of that previously operated by the various milk marketing boards in selling the product.
Milk farmers are competing in a very unequal market. We all know that when David squared up to Goliath, he eventually won, but he was helped by having a few stones in his hand at the time.
Mr. Cynog Dais (Ceredigion)
I appreciate many of the remarks that have been made about the milk industry. The hon. Member for Braintree (Mr. Hurst) made a compelling analysis, and I endorse all of it—except the references to the Celtic twilight; I do not approve of that kind of thing.
I want to speak about short-term measures and longer-term strategy. The start of my speech is anecdotal. At the end of August and the beginning of September, when the story about sewage getting into the food chain was hitting the headlines in the French press, I was in Brittany, on a twinning visit. I had a long conversation there with a Welsh dairy fanner—a neighbour of mine—and a Breton dairy farmer.
The Breton milk producer had anxieties about the future. He was producing about 250 litres per annum. He could see a trend towards larger units, and he was trying to decide whether he should join that trend. Despite his anxieties, the differences between his circumstances and those of my Welsh neighbour were striking. He was getting about 20p a litre for his milk; my neighbour was getting 17p. Both of those prices, of course, are now decreasing.
Why did the two prices differ? I identified two elements. The first was the strength of the pound against the euro. I am told that the pound is up by 7 per cent. against the euro since January—and the pound has strengthened 30 per cent. in the past three years. The other factor was the strength of the vertically integrated co-operative to which the Breton farmer belonged, which gave him strength in the marketplace. In addition, he had the advantage of being able to sell his calves and his barren cows for a good price, so he could say that he was making a good living, although it was a hard living. He was making about £20,000 a year. The contrast perfectly illustrates the appallingly unlevel playing field on which United Kingdom dairy farmers have to play.
1179 The Welsh and the Bretons are cousins, and we do not want to hear any anti-Gallic xenophobia in this place—that is the last thing that we want to feed into the situation. The UK Government are far from powerless. The high pound is, to a large measure, the outcome of UK macro-economic and fiscal policy, which is hammering the north and west of the UK—not only in agriculture, but in other sectors—and most of Wales. The UK Government could, if they wanted to, change direction on that, and they should do so. Roll on the single currency, say I.
On the sale of calves, it is time to push hard for the resumption of live exports. There is no ethical justification for not doing so. That subject is not on the immediate agenda, but it is time to open that discussion. I hope that the Minister will tell us the Government's position on that. Concurrently—they are not mutually exclusive options—we need a strategy for a UK-based and a Welsh-based welfare-friendly veal production and marketing system.
The problem of barren cows is obviously intractable, but I want to hear the Government's views on when we start to make good use of, instead of destroying, that resource. On the powerful integrated co-op, the Government's action on Milk Marque has been the opposite of helpful, as has been said. That is water under the bridge, and we must try to build on what is available to us.
When, in addition, the Meat and Livestock Commission contends that UK meat inspection charges mean that the British meat industry is seriously disadvantaged by higher costs, we start to understand why farmers are so angry—why they feel that they are treated so unjustly. All that they have been saying about the unlevel playing field in recent months is vindicated by the facts.
I shall now discuss longer-term issues and the need to lay the foundation of a new sustainable farming industry, specifically in Wales. I shall be very specific about one issue. Enlightened opinion is unanimous that the way ahead for agricultural policy is the decoupling of support from production, and the use of environmental management payments to encourage good practice and strengthen family farms. Both can be done if the schemes are properly designed, with modulation. The Minister spoke about that.
Since 1992, Wales has had an agri-environmental scheme, Tir Cymen, which is widely regarded as one of the best in Europe. However, it was available only on a pilot basis and only in some areas. It has now been replaced by an integrated national scheme called Tir Gofal, which brings together and supersedes all the agri-environmental schemes, including Tir Cymen, the environmentally sensitive areas—ESAs—and others. Properly implemented and funded, Tir Gofal could, at an annual cost of £60 million to £65 million per annum—quite a lot of money—provide a lifeline for many Welsh farmers at a time of crisis, and play a key role in laying the foundation for a sustainable future.
Professor Gareth Wyn Jones, the author of Tir Cymen and one of the great experts in the field, suggests that a full-blown Tir Gofal could bring in as many as 60 to 70 per cent. of Welsh less-favoured area farmers, and somewhat fewer in other areas. It could create 1,200 new jobs, plus a multiplier effect. By bringing on-farm woodlands into management, it might help to create several thousand jobs in hardwood extraction, processing and manufacturing.
1180 Tir Gofal could significantly strengthen green tourism strategies. It could help to improve animal husbandry and lamb quality, and be an important asset in promoting a Welsh quality product in the marketplace. Marketing quality is vital. Tir Gofal would cover part of the cost of fulfilling national—by which I mean Welsh—and UK obligations under the habitats and birds directive. It would encourage positive management of special areas of conservation and special protection areas, and protect sites of special scientific interest. With those multiple benefits, the environmental gain would be significant.
The problem, of course, is cash. The current intention is for £20 million to be allocated to Tir Gofal by 2002–03. Currently, fewer than 500 farms have been accepted into the scheme for next year, when we should be aiming at 1,500 farms per annum. European funding equivalent to 50 per cent. of the cost of the scheme should reduce the cost to the National Assembly Budget from £20 million to £10 million. However, that will not happen, because the European moneys are not additional to the Welsh block; they end up in the Treasury. The money is paid from the Intervention Board to the Countryside Council for Wales, from the CCW to the Welsh Office, and from the Welsh Office to the Treasury.
Moneys that should have been available for a vital project for Welsh farming and rural areas are being appropriated by the UK Treasury and used for general Government expenditure. The same is true of all European moneys allocated for Wales since 1992 for all other purposes, and unless things change, the same will remain true of the £1.2 billion of objective 1 money allocated to Wales for the next seven years—and objective 2 and objective 3 money also. It sounds bizarre, it is outrageous, but it is true.
In relation to Tir Gofal, we could at the same cost to the Welsh Budget—£20 million—spend £40 million and double the number of farmers coming in, but the position is better, or perhaps worse, than that. From January 2000, 50 per cent. of Welsh land area will be objective 1 designated, and thus eligible for 75 per cent. European contribution to Tir Gofal.
I must cut a long story short. Gareth Wyn Jones, in his excellent paper entitled "Funding, Fairness, Farming and the Future"—which I commend to the Minister and particularly to the Chancellor of the Exchequer—calculates the potential loss to Wales of non-additionality in this single scheme, leaving aside other accompanying measures. He calculates that in 2002 the loss will be about £40 million. Over the seven-year structural funds period, it will be about £240 million.
Gareth Wyn Jones asserts that additionality would apply in most, if not all, other European countries and regions. For example, it would certainly apply in one of the German Länder, which develop such schemes, draw down European funding and thereby increase the number of schemes that they can implement. In the UK we do not have additionality for that purpose.
Additionality is certain to become a major political issue in Wales over the coming months. It is still not properly understood, but as it becomes more widely understood, it will become a more significant issue. If the Government want to retain political credibility in Wales, they must address it.
1181 With the agricultural crisis biting ever more viciously into the economy of rural Wales, I appeal for it to be addressed urgently—
§ Mr. David Borrow (South Ribble)
Two weeks ago, with my hon. Friend the Member for West Lancashire (Mr. Pickthall), I held a public meeting in the village of Rufford in my constituency to discuss the rural audit carried out by the Labour group of rural MPs. As one would imagine, it was a lively meeting, probably half of which was dominated by agricultural issues. However, unusually, the time discussing livestock issues was relatively short, reflecting the nature of that part of Lancashire. There is livestock production—mainly lamb and beef—and some dairy farming in South Ribble, but horticulture is dominant, particularly glasshouse and vegetable production. That particular sector does not, and did not in the past, rely on subsidies from Europe or anywhere else. It has always been driven by market forces, and many of the problems now faced by that sector are the result of those market forces.
A number of issues were discussed at the meeting which had been raised with me previously and which I wish to mention now. The horticultural sector has grown extensively during the past 10 years. United Kingdom production has increased in value from £463 million to £655 million, but, significantly, £500 million-worth of produce is imported. The proportion of imported horticultural products consumed in the UK has increased rather than reduced, and one issue that we need to address is the role of Government in enabling the horticultural sector to increase production and become more competitive.
§ Mr. Wardle
Bearing in mind what the hon. Gentleman has just said, what does he think the climate change levy will do to the competitiveness of those growers?
§ Mr. Borrow
If the hon. Gentleman will allow me to continue with my speech I shall deal with various issues.
During my time in Parliament, agricultural debates have been dominated by livestock issues, perhaps reasonably given the particular problems of that sector. However, in the villages of Hesketh Bank and Tarleton in my constituency horticulture has long been a major employer, and, although there has been consolidation within the industry, a number of key issues need to be addressed. One concerns the Government's taxation policy.
If the Government levy a tax they must be clear whether it is to generate income or to tackle a problem. I remain unconvinced that increasing the pesticides tax will have the desired effect of reducing the amount of pesticides used, rather, it is only likely to increase the amount of cheaper pesticides used at the expense of better and more environmentally friendly pesticides. It is important that MAFF and the Treasury should decide 1182 whether the purpose of the proposed pesticides tax is to increase tax revenue or to tackle an environmental problem.
The climate change levy poses a particular problem. In order to compete abroad, growers need to be able to heat their glasshouses. If a levy is imposed, it will do a great deal to unbalance the level playing field. Growers in my constituency have said time and again that they would welcome a free market, because that is what they are used to, but they want fairness in the EU in terms of the pressures on them as producers compared with those on the competition. They have suffered significantly from competition from Spain and Holland in recent years and they have pointed out to me examples of where the tax and support regimes in those countries differ from those in the UK. Those issues need to be tackled by the Government.
Twenty-five years ago, horticultural production was largely dealt with through the wholesale market system and the town of Preston had one of the strongest wholesale markets in the UK of market gardening produce. However, much production now goes straight from the grower to the supermarket, which creates an imbalance in the market. Although the industry is beginning to tackle that issue, and has done so quite successfully in certain sectors, we need a better marketing strategy and a coming together of producers, perhaps through the co-operative system, if the horticultural sector is to compete and even up that part of the playing field.
There is a direct role for the Government in the horticultural sector, as in other sectors, and they could help it to market itself, not only in the UK, but in the rest of Europe. One of the problems with UK agriculture is that it has always aimed at the domestic market rather than competing in Europe. Every other EU country sells a significant amount of agricultural production outside its domestic market, but the UK does not. We need to seize the opportunity. If we are to make beef a premium product, there is scope in the horticultural sector for achieving the same status and competing for a niche market across Europe. The Government should recognise the need to do that and perhaps give more attention to the horticultural sector.
I am concerned about the extent to which training and education in the agricultural sector is becoming dominated by classroom teaching in colleges. Myerscough college, which is in the constituency of my hon. Friend the Member for Lancaster and Wyre (Mr. Dawson), has a base in Hutton in my constituency. It is a fine college and I visit it regularly, but we need to recognise that a lot of agricultural training needs to be carried out on the job and on the farm and we need the right training to be available locally. It is wrong to assume that people can travel 20 or 30 miles to an agricultural college to do all their training. That is a myth—it will not work.
In my constituency, Lancashire Growers, which is a consortium of farming businesses, has put together a training agency. It has done excellent work over the years, but I am concerned about the extent to which such industry-based training agencies are being sidelined and not recognised as being important. The danger is that more training will go from the farm into the classroom. There is a role for both, but if we are not careful we will fail to recognise the importance of farm-based training. That could happen because the agricultural sector tends to be dominated by small companies and their opportunities 1183 for putting their case to the Government are limited compared with those of larger companies. The same is true of any sector of the economy, but it is particularly so in agriculture.
I would like the Government to consider going into listening mode and giving more of a voice to the smaller farmers who operate in some of the niche markets. The battle in this place over the past week has been dominated by the livestock sector, which has meant that the other key agricultural sectors have tended to miss out. They are just as important and have just as big a role to play, but if we fail to listen now they could face major problems in the future.
§ Mr. William Thompson (West Tyrone)
I welcome the opportunity to highlight yet again the particular agricultural difficulties that we experience in Northern Ireland.
I am glad that the House as a whole now recognises the serious state of the whole agriculture industry in the United Kingdom. Many Members have drawn attention to difficulties in their areas. We in Northern Ireland have those difficulties as well; indeed, we have them to a greater extent, in terms of percentage and the fact that we have more farmers per head of population. A total of £572 million has been removed from the Province's economy over the past five years, and the annual total farm income has plummeted by 75 per cent. to £82 million in that period. The agri-food industry in Northern Ireland is its largest single industry, accounting for 10 per cent. of civil employment and 7 per cent. of gross domestic product.
In 1997, the average net farm income was only £3,093, 75 per cent. of farms had a net income of less than £10,000, and 38 per cent. of farms made a loss. Farm incomes in Northern Ireland are falling at twice the rate of those in the United Kingdom. There is clearly a tremendous problem in Northern Ireland. The banks are owed some £520 million— not to mention what the feed suppliers are owed.
The Minister recently received a deputation from Northern Ireland, and I welcome that. Someone mentioned tea and sympathy; we were certainly given tea, and indeed we were given sympathy. Moreover, we were given promises that something might happen, and that something might be said today. Of course, something has been said. We find that there is to be £5 million for marketing, and that a greater incentive is to be provided in regard to labelling. Although those developments are welcome, however, they are not adequate to deal with the problems of the Province.
There is still a big problem in the beef industry, although the ban has been lifted. Because of strict procedures, very few cattle are available for export. It would be helpful if the beef on the bone ban were lifted as well. The Minister says that the advice from the hygiene point of view is that it can be lifted; indeed, he says that he would lift it if he had the support of the environmental authorities and the Parliament and Assembly in Scotland and Wales. I say this to the Minister: lift the ban immediately. If he does so, he will surely find that Scotland and Wales will follow suit very quickly. They could not possibly continue the ban in their countries if it had been lifted here. The ban has been a 1184 stick to beat our backs with. The French Government say, "They have banned their own beef; if they do not eat their beef, why should we buy it?"
I sympathise with what the hon. Member for Beverley and Holderness (Mr. Cran) said about the pig industry. He expressed precisely the feelings in my own constituency. Although his comments related to pig farmers and the pig industry in his constituency, they apply equally in mine. Unfortunately, however, the pig price in my constituency is between 10p and 15p less than it is on the mainland. We also have additional costs in importing grain and in pig production generally.
I had hoped that Ministers would today announce that they are doing away with the offal disposal regulations. Such action would make a significant difference to many pig farmers, providing them with another 5p to 6p in the sale of each pig. Although it would not enable farmers to make a profit, it would help them to pay for the meal being consumed, and allow some of them to stay in business until the day comes— we hope that it will come— when they are able to make a profit.
When we met the Agriculture Minister, he told us that he will approach the Spongiform Encephalopathy Advisory Committee. He said that again today. We want to know when he will do that and when we will see some action. We have promises, but we want action.
Many farmers in my constituency, especially pig farmers, have made great capital expenditure to build new premises to meet the new regulations banning tethers and crates. Farmers have gone to banks and borrowed money, but now are unable to pay back interest or capital. They are desperate.
If the Government introduce safety regulations that are different from those applying elsewhere in Europe, farmers should be entitled to Government compensation for the additional expenditure. When pig farmers come to me, they simply say, "All we want is a level playing field." It is all right having a common market and doing everything in common, but an uneven playing field negates the argument in favour of such a market. On behalf my pig farmers, I plead for a level playing field.
The incidence of BSE in Northern Ireland is the lowest in the United Kingdom. This year, we have had only five cases. The Republic of Ireland has twice as many cases of BSE as Northern Ireland, but, unlike Northern Ireland, it is able to export cattle. Northern Ireland should also be able to export. We should be recognised as an area with a low incidence of BSE, so that many of the restrictions may be lifted. Although I realise that such a move may not go down well in some parts of Britain, given our very low incidence of BSE, there is a strong argument for it.
The Government have agreed to request the provision of £129 million that is available from the European Union's agrimonetary compensation scheme in 2000 and 2001. The United Kingdom also has the option of providing a matching amount, but, to date, there has not been such a commitment. Even if all possible funds were made available, that would still result in a decrease in the levels of all CAP premium payments in Northern Ireland. I ask the Government to provide the £120 million matching funds in 2000 and 2001.
I understand that a proportion of the agrimonetary compensation agreed in 1997—
§ 6.5 pm
§ Mr. Hilton Dawson (Lancaster and Wyre)
It is a pleasure to take part in the debate and I shall stick to five minutes to allow other hon. Members to contribute. It has been an excellent debate, and the scene for it was set by the typical calm, dignity and good sense of my right hon. Friend the Minister in his introduction. Hon. Members on both sides have addressed themselves seriously to this very serious issue. The only exception was the hon. Member for South Suffolk (Mr. Yeo) who, with his arguments shot away and the scientific and legal basis for what he was trying to say foundering, sailed on towards the French to try to start a trade war. He is a farcical Lord Nelson for our time.
We can quote all the statistics we like, but I know that agriculture is in a serious state because I have seen the effects on people in the past couple of years. We have a fine farming community in Lancaster and Wyre, full of decent people, many of whom have been marked by desperation and despair. I think of a chap whose family has owned his farm for 200 years, but now sees it all going and thinks it is all his fault. I know a farmer who has had to spend his retirement savings on propping up the business. Now he is growing older and more tired, but he can see no way out of unremitting physical toil. Some families want to ensure a future for their children in agriculture, but that possibility is disappearing. Such people have been driven into despair because their income is being driven down.
Of course farmers have to produce safe, good quality food efficiently in a competitive environment. We also have the problems caused by the collapse of markets, the strength of the pound and the legacy of BSE. Even in a context of considerable assistance to agriculture, the supermarkets and dairy companies seem to be able to dictate the price that they will pay, without passing on lower prices to the consumer. Our efforts to produce quality food to high standards of animal welfare are undermined if we do not use every legitimate and scientific means to ensure that poorer quality imports do not hit the streets; if consumers do not have the benefit of accurate labelling; and if large concerns constantly have to be cajoled and persuaded to emphasise quality, freshness and animal welfare over the lowest common denominator of price. We have talked much about what the farmers and Government need to do, but less about what the supermarkets and dairy companies need to do to emphasise the quality of British produce to consumers.
We have to consider ways to develop effective co-operatives and marketing strategies. I was pleased to hear about the countrywide approach to marketing that is being further developed, but we need to emphasise regional and local distinctiveness. I want to see a made in Lancashire label attached to all sorts of quality produce, not just traditional agricultural produce. Our local farmers market, for example, has ostrich—produced by local people—on the menu, as well as selling the finest pork burgers available. We need to build on such innovation.
The Government are giving tremendous support to agriculture. My right hon. Friend the Minister listens, cares and approaches the issue properly, but we need to do more. We need to look to the future. If we are going to have to have bigger farms, we should have a retirement scheme so that people can leave the industry with dignity. We need greater emphasis on co-operatives and collaboration. No more obstacles should be placed in the 1186 way of Milk Marque and other producer organisations, and an enabling and supportive culture should be fostered in the Ministry.
I believe that the rural community is strong and resilient. The Government have a real stake in this country's agriculture, and farming—and the young people going into it—have a real future.
§ Mr. John Burnett (Torridge and West Devon)
I apologise for my brief absence from the debate, Mr. Deputy Speaker. I have been able to establish that, contrary to what I understood previously, a United Kingdom company was the source of French chicken burgers, worth about £40,000, that were used in Devon's schools. I apologise for my earlier intervention being therefore incorrect.
However, I must add that every year Devon county council buys food worth about £1.8 million that is produced by west country suppliers. It will be of interest to hon. Members and their local authorities that Devon county council has taken a number of constructive measures to assist agriculture. First, it has established, and is financing and supporting, the organisation Devon Food, by means of which local farmers are linked with local consumers, to whom they sell their produce. As a result, 13 new businesses and 35 new jobs have been created.
Secondly, the county council has set up and is supporting the "Made in Devon" scheme to promote local producers. Thirdly, the council has invited the National Farmers Union to join it in scrutinising Devon's purchasing agreements, and in examining ways in which quality and welfare conditions can be incorporated to ensure that our farmers operate on fair terms with their European counterparts.
The Parliamentary Secretary will be aware of the parlous state of agriculture. Last year, I thought that things could not get worse but, to my regret, they have. Time is short for many farmers throughout the country—they are either insolvent now, or on the brink of insolvency. Earlier, I asked the Minister about the timing of the proceedings that the European Union is likely to take after today's meeting. I hope that the Parliamentary Secretary when he winds up will answer the following urgent questions.
How long will it take before the EU proceedings are resolved? Is there a fast track for such proceedings? Would it be in the interests of our farmers for the United Kingdom also to take separate action, concurrent with the proceedings envisaged to be undertaken by the EU? Finally, the French have taken unilateral and illegal action: what penalties will be sought for that breach of the law and of good faith?
§ Mr. Gareth Thomas (Clwyd, West)
I am pleased to contribute to a debate on a subject of crucial importance to my constituents. The hon. Member for Eddisbury (Mr. O'Brien) spoke earlier, and I congratulate him on an interesting and well delivered maiden speech. His constituency on the Cheshire plain is close to mine, but hon. Members will know that the land rises the further west one goes towards the Clwydian range. My constituency is therefore in what is regarded as a less favoured upland area, where the only sustainable form of 1187 agriculture is the raising of livestock. There are no fewer than 900 farms in my constituency, and the people engaged in that hard business are admirable and hard working. Agriculture has a particular resonance in Wales. Relatively speaking, many more people are employed in agriculture there than in other parts of the UK. Wales is more rural.
The Welsh language is particularly strong in rural Wales, which may account for the emotional charge about this issue in Wales, although that is also true of other parts of the UK. One acknowledges the strong attachment to the landscape in places in England and Scotland where farms may have been in the same hands for many generations or centuries. One pays tribute to the wonderful English landscape. The issue is charged emotionally as well as economically, but we must adopt a rational, clear headed approach to the combination of difficult problems that the Government have inherited.
I congratulate my right hon. Friend the Minister of Agriculture, Fisheries and Food for keeping his head and adopting a rational approach to the crisis. I congratulate the Government, too, on the steps that they have taken to ameliorate the situation. We must not forget that £5 billion a year is being paid directly to UK farmers under the common agricultural policy. The Government have made extra payments of £742 million, including higher hill livestock compensatory allowances and aid with meeting the costs of inspection and the extra charges resulting from BSE.
In the extremely limited time available to me, I want to concentrate on a few points. I warmly welcome the Government's embarkation on an industry-led review of the regulatory burdens on agriculture. That is a particular source of grievance among farmers in my constituency. One source of particular frustration is controls on sheep carcases, which have to be split so that specified risk material can be removed. If the Government could move on that point, it would go a long way towards improving morale.
I stress the importance of the EU's rural development regulation. Many people in agriculture believe that it has tremendous potential to improve the long-term prospects of agriculture and the rural economy. One thinks of agri-environmental schemes, steps towards proper early retirement schemes, aid for young farmers, marketing and processing grants. Unfortunately, the regulation is not properly funded in the UK. Of the available EU budget, only 3.5 per cent. has been allocated to the UK. I agree with what many commentators—including the Country Landowners Association and the Council for the Protection of Rural England—that that is ludicrously low.
I should like the Minister to address two questions: what representations have the Government made to increase that figure to somewhere near the EU average, and if that is not possible, can he suggest how resources might be shifted from market support subsidies to the rural development regulation? Under EU regulations, particularly the Amsterdam treaty, that is possible up to a ceiling of 20 per cent., and I should like to hear the Government's views on that point.
The National Assembly for Wales has had a shaky start, but it is determined to adopt a consistent and clear strategy. It seems to me and to many others—I agree, for example, with my hon. Friend the Member for Lewisham, Deptford (Joan Ruddock)—there has been a recent 1188 collapse in the post-war consensus about farming. We need clearer objectives for the industry if it is to have a sustainable future and to give hope to generations of farmers to come.
§ Mr. Deputy Speaker
Order. I am bound by the rules of the House and we cannot extend the debate beyond 7 pm.
§ Mrs. Ann Winterton (Congleton)
First, I warmly congratulate my new neighbour, the hon. Member for Eddisbury (Mr. O'Brien), on flying over the first hurdle in his parliamentary career with great style by making such a splendid maiden speech.
Since the Government came to power, farm incomes have fallen by three quarters, hill farmers are having to shoot their own sheep, there is no market for calves, and dairy farmers have seen milk prices fall to their lowest level for 11 years. As for British beef farmers, the situation gets worse every day.
The Scots and Welsh are refusing to lift the ban on beef on the bone and, in doing so, are placing enormous pressure on the new devolved machinery. Is it not a little ironic that the lifting of that ban throughout the United Kingdom has been trapped in the devolution doldrums? How can we expect other European nations to accept our beef products, when we in the United Kingdom continue to refuse to allow our own people the freedom to enjoy beef on the bone, against the advice of the chief medical officer.
The Minister should take his courage in both hands, give a lead and take action on behalf of England. As the hon. Member for West Tyrone (Mr. Thompson) said, the others would fall in and follow that lead. The French and Germans are following suit in this nonsense and, in the process, laughing at the European Union which sits idly by as British farming goes deeper into the mire.
Justifiably, British farmers are outraged by the unilateral ban imposed by the French Government on the import of our beef, in direct contravention of the EU ruling to lift the ban in August. What is even more scandalous is that while those countries continue the ban on quality British beef, the European Commission has exposed France and Germany as nations where animal waste and possibly human and veterinary waste have been routinely and illegally used in animal feedstuffs.
Earlier today, my hon. Friend the Member for Macclesfield (Mr. Winterton) gave me a note of a UECBV Secretary General's meeting held in Brussels on Tuesday 28 September—a mere month ago—which states:In discussion it emerged that in Germany all dead animals were collected and rendered under local authority supervision, but rendered material, including pets faeces and gut content went into animal feed. This was causing concern and conflict among meat processors and the medical profession, not least because dead animals might contain medicines or poisons used in lethal injections.That makes disgusting reading.
1189 The UK Government might be wasting time in seeking redress, but the British public are doing their best and doing the job for them by refusing to purchase French produce and standing up for British interests.
§ Mr. Hayes
I know that my hon. Friend takes an enlightened and open-minded view of Europe. Perhaps she will comment on what she thinks European Governments would do if British farmers were found to be doing the sort of thing that she has described. Those Governments would use it as a way to stop British imports into their countries.
§ Mrs. Winterton
That is a good point. Of course, we all know precisely what they do because we have seen France in action on many occasions. They would take the action that was in their best national interest and twiddle with the rules later. That is the answer, and my hon. Friend, the House and everyone in the country knows it.
Having said that, I commend the Minister of Agriculture, Fisheries and Food on his personal action in not eating and drinking French produce. It is sad that his stance is undermined because he does not have any support from any other Minister, including the Prime Minister, which shows precisely what this Labour Government think of our farmers. The Government have done virtually nothing. Let us flip the coin. To return to the intervention by my hon. Friend the Member for South Holland and The Deepings (Mr. Hayes), other Governments would act completely differently.
Our farmers have waited patiently for three and a half years to get top-quality British beef back on the menu across Europe. Having put our house in order and having done more than has been asked of us as a beef-producing nation, why should our beef producers suffer any longer in the face of this thinly veiled attempt by France at protectionism?
By putting off any decision on the illegal ban of British beef exports, the European Commission is colluding with French and German delaying tactics. Ever since the Prime Minister claimed to have lifted the EU ban on British beef, France and Germany have deployed a variety of delaying tactics to ensure that the ban remains in place. The situation displays much of what is wrong in the EU and certainly shows its weakness in dealing with any issue.
In the face of this inaction, we have scenes just across the English channel of a few French farmers blockading the channel tunnel and flagrantly breaching the law by breaking Customs seals on lorries, while the French police look on with inactive complicity—what an absolutely dreadful state of affairs.
The Government have also blocked Milk Marque, our largest dairy co-operative, from investing in processing. My hon. Friend the Member for Macclesfield and I represent a goodly part of Cheshire, where dairy farming is extremely important. Delays in releasing the Monopolies and Mergers Commission report on the future of Milk Marque and the United Kingdom dairy industry have created considerable uncertainty for all involved in milk production and processing.
Hon. Members on both sides agree that the dairy industry is experiencing a crisis. Incomes are lower than they have been for 60 years, with farmgate milk prices 1190 having fallen by nearly a quarter over the past two years. As a child I was told about dairying in the 1930s, when my grandparents were involved in it. I know precisely what the situation was like then. It is shocking that we are repeating that history at the end of this millennium.
The MMC report leaves dairy farmers with key questions unanswered. It based its conclusions on Milk Marque's market share in 1997, which was 49 per cent. of Great Britain's market. Its current market share is 39 per cent. British dairy farmers do not understand why the Government have placed restrictions on Milk Marque based on out-of-date figures in the report, which risk leaving the United Kingdom dairy industry at a disadvantage compared with its competitors overseas.
Dairy farmers' co-operatives have large market shares and are common in other parts of Europe and the world—for example Sweden, Denmark and Holland. They all have vertically integrated co-operatives with more than 50 per cent. of the market. The MMC report says that our consumers pay more for milk than they should as a result of Milk Marque—try telling that to a dairy farming family who have seen the price they receive for milk drop by more than a quarter in the past two years.
All this exacerbates the disastrous common agricultural policy reform negotiations, when Ministers agreed to give four EU countries, including Ireland, extra milk quota next year while mainland Britain's quota is frozen until 2006. What price, then, the cosy relationship between Government and the EU? It simply is not delivering. It means that increased milk imports from Ireland will further undermine British dairy fanners, and although Britain has some of the best dairy producing land in Europe, our farmers are prevented by quota limits from meeting home demand. Ireland, by contrast, already produces more than four times its domestic needs.
Further, the termination of the calf-processing aid scheme in August has resulted in a collapse in the calf market. The Government should introduce a calf disposal scheme, operating to high welfare standards, to put a floor in the market as a short-term relief. The industry itself is actively exploring the development of existing and new markets for calves, and there is a small market for the better beef calf. What could be more devastating than for a farmer to stay up for three quarters of the night to help a cow safely deliver—
§ Mr. David Drew (Stroud)
I shall keep my remarks short as we are approaching the summing up. I wish to make some positive comments in what has generally been a good debate. I start with two quick observations. We could all spend many hours debating the situation in the milk industry. I am pleased to see the hon. Member for North Cornwall (Mr. Tyler) in his place. He has said many times that no one would have started in the present situation because the conflict between Milk Marque and the dairy companies was always unsustainable.
We have heard many theories about how BSE has caused many of the difficulties that we face. My understanding was that the ban on beef on the bone was imposed because the BSE prion was present in the dorsal root ganglia and could be present in the marrow. I hope that there will be good news and that that is confirmed 1191 not to be the case, but it took some time for science to come up with clear answers. It was right to impose the ban rather than take risks. If we believe in the precautionary principle, we should apply it.
I wish to make some positive comments about how we can take the agriculture industry forward. We have to be careful with the words that we choose, but I recognise that one of the factors that has caused so much difficulty for farmers is the loss of consumer confidence matched by excessive supply in all manner of sectors. We cannot by debating restore that confidence, but we could make it worse. I hope that the speeches made tonight have not done so, but I fear that some may have. We have to rebuild that confidence by recognising what consumers are saying. They want more access to local produce, and they certainly want organic produce. That is why the £10 million announcement by the Government is greatly to be welcomed.
Consumers also wish to know that labelling and other ways of genuinely telling what one is eating are as they should be rather than how they have been perceived in the past. On the producer side, farmers are looking for guidance and new directions. The farmers to whom I talk largely welcome the implication that they will have increased environmental responsibilities, but they want to know the detail and the amount of money that will be provided, as I said in the Liberal Democrat Opposition day debate.
We have to be clear. My hon. Friend the Member for Clwyd, West (Mr. Thomas) referred to the importance of the rural development regulations. The amount of money that can be allocated to Britain is far too low and we have to find a way of increasing it. Farmers will judge the effectiveness of schemes not just by how much money goes into them but by the psychology that backs them up, how important people will therefore perceive them to be and what they say about the direction in which the Government want farming to go.
We must look for new forms of production. Mention has been made of energy crops and reafforestation. They are important in their own right, but we must seek ways in which farmers can collaborate and, dare I say, co-operate. I stress that I am a Co-operative Member, and it is up to the co-operative movement to take a lead, but it is for all others to join in so that co-operative methods of production become the norm, in at least some sectors, rather than abnormal.
I hope that my hon. Friend the Minister will take up the point that I raised last week. The most vulnerable group is almost certainly tenant farmers. I make no apology for raising again the possibility of particular help for them through the county farms, to ensure that rents are not raised or even to reduce them so that farmers can continue. We must ensure that we get it across to our neighbours across the sea, who have no knowledge or understanding of tenant farming, how important this form of production is, not just to our agriculture but to our countryside. If we take nothing else from today's debate, we should take that point: those farmers are under the greatest attack and they need the most support. On that point, I am happy to end my speech.
§ Mr. James Paice (South-East Cambridgeshire)
As has been pointed out from both sides of the House, the debate has been heartfelt: no one could conceal the crisis in 1192 agriculture. However, first I must refer to a highlight in the debate—the maiden speech of my hon. Friend the Member for Eddisbury (Mr. O'Brien). He showed the warmth and humour that we have already come to recognise; he also demonstrated his business experience and his belief in the freedom of businesses to prosper. He acknowledged, as I hope we all do, the debt and the duty that we owe to those who have gone before. He referred to the importance of the dairy industry and expressed his support for vertical integration, as did his constituency neighbour, my hon. Friend the Member for Congleton (Mrs. Winterton). He brings a wealth of knowledge, objectivity and ability to the House, and we are the richer for it. We welcome him.
The crisis in agriculture has many causes. The Minister of Agriculture, Fisheries and Food recounted them and I shall not repeat them. Of course, they are not all the responsibility of the Government—the economic consequences of events elsewhere in the world cannot be laid at the Government's door. However, the Government are responsible for some of the causes; furthermore, it is incumbent on them to do all that they can to mitigate the effects of matters for which they are not responsible. We are in a desperate situation which requires desperate measures.
The Conservatives support the Government's encouragement for the demand side, and my hon. Friends will lend their support for public purchasing, as the Minister requested. However, it would be much better if Labour-controlled local education authorities were already using British beef. It will take time to improve the demand side, but our farmers do not have that time. At present, the Royal Agricultural Benevolent Institution—an excellent charity which I know well—is receiving calls for emergency hand-outs at levels not seen since the 1930s. The charity's spending on emergency aid is already double what was budgeted for this year and is rising steeply.
Farmers are proud and independent. They work hard for long hours. They are used to facing difficulty. However, few Members of this House can understand the anger and the shame that farmers feel at asking for charity—as ask they now must. Farming cannot be immune to economic change, or from the changing needs of society and the consumer, Farmers need to work together to improve their marketing, but they deserve a chance to change. Plain common sense says that they cannot compete or be expected to thrive if they are confronted with crippling costs and regulations not faced by their competitors.
We need to know more about the Government's long-term objectives. They talk about restructuring and less subsidy, but we hear nothing about their objectives for rural communities. Does the Minister want to find a way for small family farms to continue in some of our most rural and fragile areas? He is aware that, on their own, under their present conditions, they cannot be economically viable. If they are to be supported, how is that to be done?
Some people ask why farmers should be treated differently from other industries. In an ideal world, that might be a fair question, but farming takes up more than 70 per cent. of the land of England. The landscape has been fashioned by farmers: features such as hedges, stone walls and vernacular buildings have come about because of farming. Of course, we can point to excesses—the loss 1193 of habitat and of some species—but is it not better to help and encourage farmers to maintain and improve the countryside, rather than to drive them away from it? We would be left with ever larger farms, less able to justify expenditure that does not generate an income. We want a shift away from production support towards targeted payments for specific purposes—environmental, social or other. The Minister is holding consultations; we hope that he will soon announce the results.
Several hon. Members, including my right hon. Friend the Member for Skipton and Ripon (Mr. Curry), and—outside the House—the NFU have referred to a trade war. The Minister is the only person practising such a war. There are two separate issues. The issue of French meat and meat products imported into this country is a food safety issue. It is about protecting the British consumer from an illegally produced product that it should be illegal to sell. That is wholly different from the French refusal to lift their import ban on British beef. We support the Government as far as they have gone with regard to that problem, although we are concerned about Commissioner Kinnock's remarks on the radio this morning that the legal process could take some years. The Minister is probably not yet aware that Downing street has suggested that the Government might not follow the legal process.
My right hon. Friend the Member for Skipton and Ripon referred to the BSE inquiry, which has cost £32 million. Although he did not say it—but I am sure that he would agree—it is rapidly becoming clear that it is a total waste of money because Government Members have closed minds. They have spent this debate, as they spend every other, blaming the Conservative party for BSE. Why have the Government bothered to hold an inquiry at a cost of £32 million if their minds are made up?
I turn to the export ban and beef on the bone. Last Wednesday, the Minister said:The fact is that beef on the bone has nothing to do with the export of British beef'.He repeated that claim today.
§ Mr. Paice
The Parliamentary Secretary agrees. If the beef on the bone ban is not connected with the French ban on British exports, why did the agricultural counsellor from the French embassy write what he did in last week's Farming News? He wrote:The decision of the French government invoking the precautionary principle is not the result of political manoeuvring, nor commercial protectionism. It is worth noting that the British Government adheres wholly to this precautionary principle, judging by some recent rulings, such as the ban on beef-on-the-bone.Does the Minister not understand that maintaining the ban on beef on the bone creates the perception at home and abroad that we are not entirely happy with our own product? I suspect that the Minister understands that but is not allowed to admit it.
The Minister said that he recognised the problems experienced by sheep farmers yet, during the recess, he blamed sheep farmers for creating their own problems. It 1194 is easy to say that they were unwise to retain so many cull ewes last year, but what would the Minister or any other hon. Member have done when faced with the alternative of giving them away or selling them for £1 each?
Several hon. Members referred to the problem caused by the removal of spinal cord in sheep. Last week, the Minister said:I shall take a hard look at what can be done".The Minister said "I shall", so he is referring to a future action. It is interesting to note that in that same debate last Wednesday he said on six different occasions that he would take a hard look at six different issues. We wonder what will happen. When referring to pigs, the Minister said:I am working very hard on it, and hope to have something new and comprehensive to tell the House in a matter of days."—[Official Report, 20 October 1999; Vol. 336, c. 454–67.]I suspect that my hon. Friend the Member for Beverley and Holderness (Mr. Cran) does not want to return to pig producers in his constituency to tell them that they have £5 million for marketing and that is it.
In the meantime, sheep producers face a bill for £1.2 million from the Environment Agency for groundwater regulations. We are told continually about joined-up government. It must amuse outsiders to hear that: has nobody told the Environment Agency or the Department of the Environment, Transport and the Regions? What about the pesticide tax, the climate change levy and the integrated pollution prevention and control charges? They are extra costs levied on agriculture when it cannot afford it.
My hon. Friend the Member for Mid-Worcestershire (Mr. Luff), the Chairman of the Agriculture Select Committee, referred to tuberculosis. It is two years since Professor Krebs reported, and in those two years the incidence of TB has exploded by about 40 per cent. a year and into new areas of the country. Even now, only five of the 10 triplet study areas have been identified. Professor Bourne, who is in charge of the studies, has said that the last one will not even start until 2001. We know that there are problems with intimidation and obstruction, and we condemn them, but we want to know what is happening.
I wrote to the Minister on 16 September asking for an update in the light of media stories about trials being abandoned and the testing of badger carcases being stopped by the Health and Safety Executive. Six weeks later, I have not received a reply. How many staff have been put on to TB work? Is that number higher or lower than a year ago? What is the Minister doing about farmers outside those study areas who will see no action at all for another six years, while the NFU estimates that it costs an affected farm £3,000 a month?
Does the Minister realise that the abolition of the calf-processing scheme removed the only outlet for calves from a herd under TB restrictions? Farmers who are facing huge losses cannot afford to keep animals that they would otherwise have sold, so those animals too are being shot. Will the Minister tell the House what is going on?
Even the arable sector has not escaped. It is faced with prices that are 30 per cent. lower than they were three years ago, although I accept that that has much to do with the strength of sterling. However, farmers cannot buy pesticides in Europe, where they are up to 30 per cent. 1195 cheaper than in this country because of British regulations. They are aghast at the price that they pay for machinery, compared to prices in other countries. It has been drawn to my attention that in Tasmania one can buy a combine harvester that was built in Europe for half the price that it costs in this country.
To add insult to injury, this autumn farmers are to have their acreage payments abated by 14 per cent. because of the strength of sterling. It is true that the amount will be made up in February, but they will suffer cashflow problems in the meantime. Unless the Government act, next year the payments will be only half made up, and the following year they will not be made up at all.
The last week has proved right farmers' suspicions. Everywhere I go in this country, farmers tell me that they think that the Government want rid of them and that they have no place in Labour's modern Britain. I fear that they are right. Every recent Government announcement or paper about the countryside has virtually ignored agriculture and concentrated on other businesses, leisure and the environment. Yes, there are many rural businesses other than agriculture, but most of them—the shopkeepers, the vets, the builders, the machinery dealers and the rest—depend on farming for their trade. Only last Wednesday, the Minister talked about the opportunities for regional tourism, and I am sure that we would all support that industry, but that was on the very same day that the Cabinet Office proposed a tax on tourists.
It is tempting to feel sorry for the Minister. He has been abandoned by the rest of the Cabinet, and Downing street is constantly briefing against him. Yesterday, at Prime Minister's Question Time, despite the fact that the right hon. Gentleman was directly mentioned by my right hon. Friend the Leader of the Opposition, not once did the Prime Minister express support for his Minister. It is no wonder—the Prime Minister knows when he is on to a loser, and he has fingered the Minister to be the fall guy.
I can only repeat the words of the highly respected agriculture journalist David Richardson, who in last week's Farmers Weekly said:In spite of Nick Brown's sympathetic sounding speeches and his ability to persuade an audience of farmers that he means to try to help them, he has not delivered. Nor does he appear likely to do so.The Minister's record of achievement is woeful. He has lost the Prime Minister's support; he has lost his way in Europe; and it seems that he has lost even his telephone. He has lost the confidence of the British farmers which he set out to nurture so carefully. It is time that he went.
§ The Parliamentary Secretary to the Ministry of Agriculture, Fisheries and Food (Mr. Elliot Morley)
This has been an exceptional debate, with the possible exception of the speeches of Opposition Front Benchers, including the hon. Member for South Suffolk (Mr. Yeo), who apparently, in agriculture debates, cannot see a top without going over it.
The hon. Member for Eddisbury (Mr. O'Brien) made a well-balanced and reasonable maiden speech. He expressed the concerns of the farmers whom he represents, which we well understand. He referred to Milk Marque. I point out that the report by the Office of Fair Trading was independent. It was not a Government report; the Government had to respond to it. The Government are in favour of Milk Marque going into processing. My right 1196 hon. Friend the Secretary of State for Trade and Industry did not accept the report's recommendation to break up Milk Marque, but he gave Milk Marque time to decide how it wanted to reorganise itself, and it has done that. Having reorganised, it will be able to invest in processing, in line with the OFT report.
My hon. Friend the Member for Braintree (Mr. Hurst) also raised the point. He mentioned marketing, too. I am very pleased to say that, as my right hon. Friend the Minister said, there will be a marketing scheme for milk to the value of £10 million, which comprises contributions from both sides of the industry.
The hon. Member for Ceredigion (Mr. Dais) mentioned milk—which is very important to his constituency—as did my hon. Friend the Member for Lancaster and Wyre (Mr. Dawson) and the hon. Member for Torridge and West Devon (Mr. Burnett). The hon. Gentleman also asked about proceedings on the beef ban. There are no fast-track proceedings. Legally, we do not rule out any approach, although I should emphasise that we want a speedy resolution to the issue. In fact, we expect it to be resolved as quickly as possible.
My hon. Friend the Member for Stroud (Mr. Drew), who also mentioned milk, rightly raised the issue of tenant farmers and their particular problems, of which we are well aware. We have regular meetings with the Tenant Farmers Association. The hon. Member for Congleton (Mrs. Winterton) also mentioned milk, which is of course very important to her constituency.
No one is denying that farming, especially in the livestock sector, is in particular difficulty. My hon. Friend the Member for South Ribble (Mr. Borrow) mentioned other sectors, such as horticulture. He also raised the pesticides tax and the climate change levy. We understand that, if such financial measures are introduced, there will be an impact on the industry. We are talking to those in the Treasury about such impacts, which we of course take seriously.
We also recognise the point made by my hon. Friend the Member for South Ribble about small farmers and their needs. Indeed, I recently met members of the Small Farmers Association in the west country, and have invited them to see me in London to talk about some of their concerns and plans.
I was surprised that the hon. Member for South—East Cambridgeshire (Mr. Paice) accused my right hon. Friend the Minister of not delivering very much. My right hon. Friend has negotiated with the Treasury a package that is worth more than £500 million over the next three years. That is new money for the farmers and a very important boost. It involves such things as the rolling over for a second year of the hill livestock compensatory allowance, despite the outgoing Conservative Government making no provision for doing so. We have found that money, which I know is of particular importance to my hon. Friend the Member for Clwyd, West (Mr. Thomas).
We are aware of the issue on spinal cord and are concerned about it. We have negotiated the possibility of the export of whole carcases to French slaughterhouses. There are limits, from which we want to expand.
The European Commission has made available a 3.5 per cent. contribution to rural development regulation, but I must point out that that is based on historical spending. One of the reasons why we have an unfair contribution is the record of the previous Government and their lack of 1197 spending on rural programmes. We are paying the price of that. I am glad to say, however, that we have managed to agree with the Commission that the contribution will be reviewed. We shall have the chance to make our case for an increase and a fairer contribution toward the rural development programme.
The aid package also absorbs the cost of specified offal removal and the cattle passport scheme.
Several hon. Members, including my hon. Friend the Member for Kilmarnock and Loudoun (Mr. Browne), mentioned agrimonetary compensation. I am pleased to announce that we have just heard that the Commission has approved a package worth £170 million, which is more than we were expecting.
§ Mr. Gareth Thomas
I am glad that the Minister accepts my case that rural development regulation is seriously underfunded. He has gone some way to giving assurances on that. On the second point that I raised, does he concede that it would be possible directly to shift money from price subsidies to RDR?
§ Mr. Morley
My hon. Friend is talking about modulation. We have consulted on modulation regarding the Agenda 2000 package to farmers and we are giving thought to the operation of modulation and how we can put extra money into the rural development package. That includes schemes such as agri-environment programmes, which are very popular with farmers, and which I know that they want increased.
In addition to that new money, considerable resources—nearly £3 billion in total—are going into the agricultural sector. About £700 million is going to upland livestock. Of course, £4 billion is being spent to meet the cost of BSE measures. I know that hon. Members do not like it, but we inherited that problem. It is a shadow cast over the whole livestock industry and is the root of many of its problems.
Nevertheless, the beef ban has been lifted. The French position is inexcusable; they are wrong, and they are isolated. The news on sewage sludge adds insult to injury, although the allegation received widespread publicity in June. I do not know why the hon. Member for South Suffolk did not notice that. In fact, the report followed from the news in June, and the Commission has been investigating the matter. The report said that the practice was not widespread but that it was illegal and unacceptable. However, as we have heard from my right hon. Friend the Minister, it does not give us a legal basis to ban meat. A trade war is not in our interests. I fail to understand why the Conservative party seems to think that the way to deal with those who are acting illegally is—[Interruption.]
§ Mr. Deputy Speaker
Order. The hon. Member for North Wiltshire (Mr. Gray) is shouting across the Floor. He must not do that. Mr. Gray, you seem to be very guilty of speaking while you are sitting there, on the Benches. You should not do that.
§ Mr. Morley
Thank you, Mr. Deputy Speaker.
I fail to understand why Opposition Members think that acting illegally ourselves is the right response to the fact that France is acting illegally. I am glad that several hon. 1198 Members, such as my hon. Friend the Member for Waveney (Mr. Blizzard) and the hon. Member for Mid-Worcestershire (Mr. Luff), agreed with me on that, as did the right hon. Member for Skipton and Ripon (Mr. Curry), in a very sensible speech. The Conservative party's chances of being electable are limited as long as people of the quality of the right hon. Gentleman are kept off the Front Bench because of the party's extreme policies. [Interruption.] I am just trying to help the chances of the right hon. Member for Skipton and Ripon, Mr. Deputy Speaker.
It was also said that Conservative Members were trying to out-Sun The Sun in their arguments for a trade war and a beef ban. They are much more extreme than The Sun; whose editorial opposes a trade ban and has supported the Government position. I was also pleased to see that this week "White Van Man", which I of course read assiduously, has been replaced by a guest, "White Tractor Man", who has given his full support to the position of the Government and my right hon. Friend the Minister. It seems that Conservative Members cannot even be in tune with the popular opinion of The Sun, which has never been slow in putting its finger on the issue.
The pig and poultry sector is in real trouble. However, there is support. There is an extra £5 million for marketing in addition to the £1 million already made available. That is very important to that sector, which we very much wanted to help.
We are considering the issue of meat and bonemeal, which is a burden on the industry. As my hon. Friend the Member for South Derbyshire (Mr. Todd) and the hon. Members for Beverley and Holderness (Mr. Cran) and for West Tyrone (Mr. Thompson) said, labelling will certainly help. Our pig industry was obtaining a significant price premium, and marketing can help to improve those prices.
I am also very pleased about the £10 million to be spent on organics. That is very important. Members have asked about those who are in the process of conversion. We were going to deal with those hard cases even before the £10 million was announced. Our policy has been a great success.
I pay tribute to my hon. Friend the Member for Lewisham, Deptford (Joan Ruddock) for the campaign that she has been running. It is important, and the targets are important. I believe that we shall discuss targets further because it is important to ensure that we meet the demands of the marketplace without setting an arbitrary target that is too high or too low.
It has been a good debate, in which hon. Members have advanced a strong case on behalf of those whom they represent. However, I was sorry about one thing. My right hon. Friend the Minister invited the hon. Member for South Suffolk to join him in a joint campaign. That invitation was rejected by the hon. Gentleman, who was more interested in making partisan points than in addressing the needs of British farmers. That will be recognised by farmers, as will the hypocrisy of an Opposition who demand labelling, yet voted against it when they had an opportunity to introduce it, and who criticise the French for illegal action, yet propose illegal action themselves. The farmers will notice who represents their interests.
It being Seven o'clock, the motion for the Adjournment of the House lapsed, without Question put.