CATTLE INDUSTRY (EMERGENCY PROVISIONS) BILL. (Hansard, 19 March 1935)

§ THE PARLIAMENTARY SECRETARY OF THE MINISTRY OF AGRICULTURE AND FISHERIES (EARL DE LA WARR)
My Lords, I do not think I need detain your Lordships very long on this Bill because the principle contained in it was fully debated in your Lordships' House last July. This Bill merely provides for an extension of the cattle subsidy that was then granted by Parliament. Your Lordships will remember that in 1932 cattle prices had fallen to such an extent that it was found necessary for the Government to take action. They did that by a limitation of imports. When that system had been put into practice however, it was found that although we had reduced imports from foreign countries by over 13½ per cent. the gap thus made had been nearly filled up by imports from the Dominions, which had increased by 16 per cent. There was no real improvement, therefore, in market conditions and it was decided that the Government must take further action.
In July last year, when they issued their White Paper on meat policy, it was pointed out that the Government's hands, as from June of last year, had been free to impose restriction upon the Dominions as well as upon foreign countries. It was felt undesirable, however, if only for Imperial reasons, that we should impose drastic restrictions on the Dominions without further consultation with them and without offering certain alternatives. Accordingly it was laid clown that either we should have to pursue a policy of drastic restriction or else—as we would be prepared and willing to do—consider the alternative system of a levy; that is, a small tariff on imports combined with a subsidy to the home producer. There again, that was a line of policy that would have to be further discussed both with the Dominions and with foreign countries who have certain treaty rights which prevent us taking that step without their consent. Accordingly, a subsidy was granted to our producers for a period of seven months in order to enable them to carry on—a subsidy of 5s. per live cwt. or 9s. 4d. dead weight. I think it is generally admitted that that subsidy has from an administrative 167 point of view worked very satisfactorily, and I think your Lordships would desire to join with me in thanks and an expression of appreciation to the Chairman of the Committee administering that subsidy and his colleagues for the manner in which they have operated it.
There are, of course, certain criticisms that require some reply. It has been suggested, for instance, that the butchers are getting too large a proportion of the subsidy. That complaint is justified by the argument that the prices continue to fall. Nevertheless, an examination of the figures does not justify that conclusion. If your Lordships look at the average prices in July, say from 1927 to 1931, you will find that the prices average out at just under 50s. If you compare those July prices with the prices for the last quarter of the year, it will be found that there was a fall of approximately 5s. during all those years. In 1934 very much the same phenomenon occurred: the price fell from 37s. 2d. to 34s. It is perfectly clear on looking at those figures that any fall there has been in those prices was not due to the 5s. subsidy and that the reasons for the continued decline go far deeper.
A further complaint that has been brought up is that of injustice to what we might call the producer butcher: that he has not been able to draw the subsidy because there is no sale, and the subsidy is payable on sale. Not only a number of individuals but also the Co-operative movement have complained of the injustice of the working of the scheme in this regard. This matter has been very carefully considered, and the Minister made it quite clear in another place that his mind was by no means closed upon this subject. At the same time it was felt that this Act was only a continuation of an emergency measure, and that it was desirable for many reasons, particularly that of simplicity, to maintain the scheme as it has been working during the last few months. In a short time—this Bill only lasts for three months, with a possible extension to six—it will be possible, we hope, to devise our long-term policy, which, if we go on with the system of subsidy, will of course have to take this point into consideration.
What has been the cost of the scheme up to date, or rather, what will it be 168 up to the end of this month, when the existing Act terminates? It will come to £2,250,000. In the last Act we visualised the possibility of the cost amounting to as much as £3,000,000, but your Lordships will realise that that is not really a bad estimate considering the lack of exact data. The extension of the subsidy up to June 30 will cost £1,050,000, and if Parliament should decide by Order, as it has power in this Bill to do, to extend the subsidy for a further three months—that is to the end of September—then the scheme will cost £2,100,000. Your Lordships will say that that is a very heavy sum for assisting one particular industry. I would, however, point out that this industry represents one of the largest portions of the agricultural industry, the whole of the meat section amounting to little under a quarter. This money, further, is enabling us to keep that industry going without bringing ourselves into collision with our great interests overseas—the Dominion interests and our interests in foreign trade. It has also given us time to devise a long-term policy that will face the problem of the consumer.
We read in the Press of "The Great Meat Muddle." It would be perfectly simple to deal with this problem if we were prepared to disregard on the one hand the interests of the consumer and of overseas trade, or on the other hand the need for keeping in existence this great and important section of the agricultural industry; but we are determined that our long-term policy shall be comprehensive, and that it shall be understood not only here but also by our overseas friends. Your Lordships are aware that the Dominion Premiers are on their way to this country, and it is vital that we should have yet further time for carrying on discussions and negotiations with them. It is the policy of this Bill to give us that further time.
One point I should like to stress is that, when I mentioned a long-term policy, I visualised not only a policy that is settled by friendly negotiation with our Dominions and our foreign friends, but also one dealing with problems of home organisation of the whole trade. I think your Lordships will realise that those two sides of the problem must be treated as one, and dealt with together; 169 it is impossible, therefore, to lay down, to-day, what are to be the details of our future organisation of the industry here at home, until it has been decided on what basis we are to operate with regard to our imports. I beg to move that this Bill be read a second time.

§ LORD MARLEY
My Lords, there is not very much point in going through again this evening the debate which we held about seven or eight months ago, when the original Bill, of which this is merely an extension, was discussed in this House. The only new factor since then has been the publication of the very excellent White Paper by the Government, Command Paper No. 4828, which is an admirable example of clear writing and simple explanation. I do not propose to follow the noble Earl in his discussion of the policies involved in this Paper, because that is not before the House this evening. All we are asked, to-day, is to approve of a continuation of the policy of marking time, of the policy of spending money to keep the United Kingdom meat industry going while the Government are trying to make up their mind after consultation with the Dominions and the Argentine.
I do not even think it matters much who is getting the subsidy. Of course, it is very nice to think that the producers are getting the advantage of the subsidy, but it is a purely temporary and marking-time measure, and I do not think we are able to analyse the actual effect of the subsidy with any degree of accuracy, because it is complicated by the effect of the Ottawa agreements, under which the imports of foreign meat have been reduced 10 per cent., whereas the imports of Dominions meat have increased by 80 percent., I think I am right in saying, in certain categories. Moreover, we have another imponderable, quite incapable of accurate ascertainment, by reason of the fact that the consumption of beef in this country is going down. The actual consumption by the British eater of beef is gradually diminishing, in spite of the fact that there has been an increase of the population. We do not know the exact details of that—possibly the Government can make calculations—but I believe it to be the fact.
170 We have no complaint whatever to make of the administration of the subsidy. We are quite sure that those who have given so much voluntary work deserve our thanks. We do not propose to discuss the sort of planning which will take place when the Dominions have come to an agreement, and when the Government have settled all the difficulties of British investors in the Argentine, and the proposal which I understand Lord Vestey is making to import chilled beef from Australia instead of frozen meat—a problem which is going to be very difficult for the Government to solve. All I want to know is this. I want to be absolutely certain that when agreement has been reached, if in fact one can be reached, which I doubt, this House will have the fullest possible opportunity of discussing the details of that agreement before it is put into force. If I can get a satisfactory answer to that question from the, noble Earl, we do not propose in any way to hold up this measure.

§ EARL DE LA WARR
I can tell the noble Lord at once, that if there is any agreement come to there is almost certain to be legislation, and this House will have a full opportunity of discussing that legislation.

§ LORD MARLEY
Will the noble Earl say whether the legislation will be brought before this House without waiting until the end of the period for which the subsidy is available, or whether we shall have to wait until the end of the subsidy?

§ EARL DE LA WARR
There are two courses of action before us—one which will require legislation, and one which will not. If we adopt a policy of levy subsidy, fresh legislation will be required. If we continue with the policy of regulating supplies under the Act of 1933, then no further legislation will be needed. In that case I will certainly convey to the Government the desire of the noble Lord for a full discussion. But at any moment he can put down a motion and force discussion of the matter.

§ LORD ELTISLEY
My Lords, it is only with some diffidence that I venture to rise to say a few words in connection with this Bill, because it is the sixth Bill to which we are giving a Second Reading here to-day. I should like, however, to stress the need of the Bill, and to em- 171 phasise the point that agriculturists as a whole find themselves in dire straits—agriculturists concerned in the production of live stock—and that in many cases disaster confronts them. I think it is generally recognised throughout the country that assistance for the agricultural industry is needed, and the National Government long ago made quite clear to the country their firm intention to safeguard the interests of producers in the United Kingdom. I would like to emphasise the point that the fat cattle industry is suffering perhaps more acutely than most other branches of the agricultural industry. In 1924–25 the index figure for fat cattle was 151. In 1934 it was only 90, and even if we continue this grant, as I am hopeful this House will do, in aid of the cattle industry, and even if the agricultural industry directly and personally obtains the full benefit of the grant, its returns would still be below the 1924 prices.
Now I would like to point out that this is largely a labour measure, if I may say so, because if the employer goes bankrupt the labourer loses his job. Since there has been a change of Government, as I personally anticipated the cost of living has fallen but wages have been stationary or have risen, and the agricultural labourer has undoubtedly shared in the slight turn for the better which has taken place in the agricultural situation. In 28 counties the wages of agricultural labourers have increased, or there has been a reduction in hours, and that tendency still continues. The purchasing power of the worker has certainly improved.
The difficulty which occasions this Bill has arisen in large measure because we are one of the few countries which open wide their doors to receive the surplus products from other countries, which are sold here in some cases below the prices which obtain in the country of origin, and we are one of the few countries which have been accepting the surplus products. I emphasise that it is most unwise to disregard the interests of the agriculturist because returns show that in 1931 1,500,000 persons were employed in the industry of agriculture, and the value of their production exceeded £254,000,000. Of those £254,000,000 a very large proportion was derived from 172 the production of live stock. I therefore welcome this measure. It should not, and I do not think that it will, put up the prices of chilled meat and other forms of meat produced overseas. It will tend, I hope, to increase the production of home meat and the consumption of the roast beef of Old England. But opposition to change comes from strange quarters. I believe the shipping industry are opposed in the main to assistance of this kind, but I should like to point out that fat live stock is a processing industry. And, even so far as the meat industry is concerned, taking shipping as a whole a bigger tonnage of cattle foodstuffs will have to be imported if we increase our home live-stock industry, which will add to the number of sailors required, and to the number of ships required, and will, in fact, increase the total tonnage coming to this country from overseas. I do not feel in the least alarmed, therefore, at the idea of any alleged, or expected, injury which it is suggested would be suffered by the shipping industry of this country.
I should also like to refer to the fact that this is a loan. It is not a gift, it is a loan which has to be repaid in due time to the Exchequer. It is well, I think, that the Government should be walking slowly and warily in this matter. The negotiations which have to be carried out with our oversea Dominions are indeed delicate negotiations, and they are very far-reaching in their effect. It is well, therefore, that we should move without undue haste in this direction. But unless this policy be adopted I do not think that there is any practical, helpful, constructive alternative policy to put in its place. It is therefore of great importance that this step should be taken. At the same time there is also a, bigger question which cannot be wholly divorced from that of assistance to home agriculture. Recent events have appeared to many of us very disquieting. Conditions in the world as a whole are far from stable, and it is no good burying one's head in the sand and believing that trouble will never come to these Islands. Therefore it becomes of paramount importance that we should take every reasonable step to maintain, develop and consolidate our great home industry of 173 agriculture. There are many other grounds which might be adduced in support of this measure, and it is with great diffidence that I have ventured to rise to say these few words.