§ Order of the Day for the Second Reading read.
§ 4.24 p.m.
THE EARL OF FEVERSHAM
My Lords; in the last three years it has fallen to my lot to bring a number of long and complicated measures connected with the agricultural industry before your Lordships, and it may be said that the present Bill is the most intricate in its provisions of all the measures I have sponsored. But I will endeavour to explain as briefly as possible the main purpose of the Bill. In the first place, it makes no alteration in the fundamental principle of the Wheat Act, 1932. Your Lordships will recall that under that Act deficiency payments are made to registered wheat growers in the United Kingdom. Those payments represented the difference, less a small deduction for expenses, between the standard price of 10s. per cwt. and the price which is prescribed as the average price per cwt. obtained by all registered growers. This is subject to a scaling down of the payments when the quantity of mill-able wheat sold in any cereal year exceeds the amount estimated by the Minister as the "anticipated supply." Under the Agriculture Act, 1937, the maximum quantity of wheat which can rank for deficiency payment at the full rate in any year has been increased from 27,000,000 cwt. to 36,000,000 cwt.
The funds necessary for making these deficiency payments are raised by a levy, or in other words a quota payment, imposed on millers and importers of flour, in respect of all flour which they deliver. The administration of the Act is in the 500 hands of the Wheat Commission, which consists of representatives of millers, flour importers, merchants, farmers and consumers with an independent Chairman and Vice-Chairman. The first Chairman was the late Lord Peel. When Lord Peel died tributes were paid in your Lordships' House to the many capacities in which he had served the State, and I would like to take this opportunity of adding a further tribute to the able way in which he presided over the Commission in its early years. I am sure the House will agree with me that the Act has been administered in a remarkably smooth and efficient manner, which reflects great credit upon the ability of the members and staff of the Commission. The Government count themselves fortunate in having obtained the services as Chairman of the noble Lord, Lord Harlech, whom I am glad to see in his place.
The principle of the Act of 1932 has commended itself strongly to the farmers, and I think I may say it has caused the minimum of difficulty to the other interests affected. But two questions have arisen which led the Government to decide that amending legislation was necessary. The first relates to the standard price of wheat, and the second to the definitions of flour and wheat offals. Under the principal Act a small Committee was appointed in 1935 to consider and report to my right honourable friend whether it was desirable to make any alteration in the standard price of 10s. per cwt. The Committee made a decided recommendation that it was undesirable at that time to make any alteration in the standard price, but that provision should be made for a further review after a period of years. The Government have accepted this proposal and under Clause 1 of the Bill there is provision for the setting up of a Standard Price Committee in the present year and thereafter at intervals of three years. In making their report the Committee are directed to consider general economic conditions and the conditions affecting the agricultural industry. Any amendment of the standard price would require to be confirmed by Parliament.
The second difficulty has arisen from the definition of flour and wheat offals. According to the 1932 Act, "flour" is subject to quota payment while "substances separated in the milling as wheat offals" are exempt, if they are used for 501 feeding to animals or poultry. Despite the absence of any sharply drawn distinction between these two groups of commodities no difficulty arose—I think Lord Harlech will bear me out in this—except with a small class of imported products intermediate in quality between offals and low-grade feeding flour. The decisions of the Commission in certain cases falling within this class were challenged in the Courts, and the case of R. W. Paul, Limited, versus the Wheat Commission ultimately came before your Lordships' House in its judicial capacity. Without going into technicalities the essential point of the decision given was that the test of liability under the Statute should not be the precise character of the substance, but its method of production and the purpose for which it was to be used. The Wheat Commission held that this decision was directly opposed to the agreement between the interests concerned on which the quota provisions were based; that is, that all commercial flour of whatever quality and for whatever purpose it was used should be liable for quota payment. The Commission also said that this decision would raise many administrative difficulties. Meanwhile, the associations representing the millers, flour importers and corn merchants entered into a Gentleman's Agreement with the Wheat Commission in which they undertook to use their influence to prevent any claim being made that low-grade flour should escape quota payment. As a result of this most helpful step it has been possible to go into the matter thoroughly and to arrive at what I think is a generally acceptable solution in regard to the main issues before bringing this Bill forward.
The solution proposed is embodied in the new and precise definition of wheat offals—or, as they are now to be termed under the Bill "wheat by-products"—which is contained in Clause 4 of the Bill. Any product of milling which does not fall within that definition is defined as flour and will be liable to quota payment. But I think it should be noticed that Clause 6 provides for a reduced rate of quota payment on certain low grades of flour which are destined for livestock—it was a disadvantage of the principal Act that if a border-line product was pronounced to be flour the Commission had no alternative but to levy the full quota payment. The effect of the changes to which I have drawn your Lordships' attention is that now 502 we have an agreed definition of flour and wheat by-products which is easy to apply and which will remove doubts in the administration of the 1932 Act.
While putting forward their proposals for dealing with the situation created by the Paul judgment, the Wheat Commission suggested that several other amendments should be made in the principal Act. These were for the most part amendments designed to remove doubts and to facilitate administration, and they account for the bulk of the remaining clauses of which your Lordships will notice there are 32 in all. I will refer briefly to only one or two proposals of considerable importance which are incorporated in the Bill. Under the 1932 Act wheat meal used as animal food is exempt from quota payment. The Commission were anxious to see some safeguard against the risk of quota-free meal being diverted to uses other than stock feeding, but the Government, on the other hand, were unwilling to depart from the original intention, which was that there should not be by the passing of the Statute any direct handicap placed upon either the livestock or the poultry industry. It is hoped that these objects will be attained by Clause 7 of the Bill.
Wheaten breakfast foods are given rather special treatment by Clauses 11 and 12. There is some doubt about the present position of these foods in relation to quota payment, but they certainly do not fall clearly within the present definition of flour, and there have been a number of protests against their freedom from liability. On the other hand, the manufacturers and importers of these foods can argue with some force, I think, that their real competition is not with bread but with non-wheaten breakfast foods. The Government therefore concluded that before deciding this question of liability the Minister of Agriculture should be advised by an impartial Committee. The effect of Clause 11 is to grant to manufacturers of wheaten breakfast foods exemption from liability to quota payment until August 1, 1940, when they will become liable unless exempted by order of the Minister. Applications for exemption will be referred to the Reference Committee to be appointed under Clause 24. Clause 12 is designed to put the importer of breakfast foods, and also the importer of other foods having a wheaten content, such as 503 macaroni, into approximately the same position as the home manufacturers as far as quota payments are concerned, but that is done by a somewhat different procedure.
A further point to which your Lordships will, I think, attach importance, is the power given to the Wheat Commission by Clause 23 to make grants in aid of research and education in regard to the growing, marketing and utilisation of wheat. This will bring the scope of the Commission into line with other bodies set up in recent agricultural legislation. I hope that the House will be content with this somewhat technical but brief preliminary explanation of a very complicated and intricate Bill. I have refrained from going into greater detail of the provisions because no doubt in the course of debate certain issues will be raised and, with the consent of your Lordships, I shall have an opportunity to reply to them at the conclusion of the debate. I beg to move that the Bill be given a Second Reading.
§ Moved, that the Bill be now read 2a.—(The Earl of Feversham.)
§ 4.40 p.m.
§ LORD SNELL
My Lords, my noble friends and myself do not propose to offer any formal or serious opposition to the Second Reading of this Bill. It is undoubtedly a very complex measure and it deals with a most important subject. To master its details requires special knowledge of farming and wheat production, but there are certain general questions concerning which we have some anxiety, and the details of the Bill will of course be the subject of consideration at a later stage. Our interest seems to centre especially in Clause 1, and as far as we can see the situation now we are far from being satisfied with what the Bill provides. Speaking generally, it would appear that the consumer of bread is to pay some £9,000,000 more for the bread that he consumes, but that there is no provision whereby the farmer who produces the wheat gets a fair share of the profits. It would appear that the millers and the middlemen are to receive the chief benefit of this measure. We should prefer that there should be established a proper marketing organisation under which the farmers would be able to market their wheat efficiently and with 504 profit to themselves. That is a question which we shall probably have to urge upon your Lordships in greater detail when the Committee stage of the Bill is reached. To-day I need only say again that, whilst being far from satisfied with some of the provisions in the Bill, we do not propose to resist a Second Reading.
§ 4.43 p.m.
§ LORD HARLECH
My Lords, I feel it my duty as Chairman of the Wheat Commission to thank the Government for proceeding with this Bill. A great part of its provisions is the result of suggestions that have been made from time to time by the Wheat Commission in the light of their experience of the working of the 1932 Act. It is, as both noble Lords have said, an amending Bill of a highly technical and complex character, and it is that because any measure dealing with a question of this kind in the light of the experience of a novel experiment—for the Act of 1932 was a novel experiment—is bound to be complex. Undoubtedly a large number of the provisions of this Bill arise out of the legal decisions that have been given in the Courts on the interpretation of the Act of 1932. We have to remember that the purpose of that Act was to levy on flour a sufficient sum of money each year to pay wheat growers in this country the difference between the price they got in the free markets of this country for their wheat and a standard price fixed by Parliament.
The noble Lord who has just spoken alarmed me when he said that as he read Clause 1 there was a prospect that the human consumers of flour would have to pay an additional £9,000,000. I can assure him that unless the Government are going to make, and Parliament agrees to, a standard price something like double what it is to-day, that is not likely to occur. It is true that this year, owing to the fact that the last harvest in the United Kingdom was a bumper harvest for wheat, and owing to the fact that during the past season wheat has been at an almost unprecedentedly low price throughout the world, something like £9,000,000 in all was necessary for the payment of the difference between what the British growers of wheat have obtained in the free markets of this country and the present standard price of 45s. a quarter. Admittedly the scale of our operations as a Wheat Commission 505 this year has been unprecedentedly large, both in the quantity of wheat ranking for deficiency payment and the amount of revenue we have had to obtain by the quota on all kinds of flour.
I will not detain your Lordships by saying anything about Clauses 1 and 2, which deal with a matter of policy—that is to say, what the standard price should be on which deficiency payments are to be based. That is a particular political and financial issue on which anybody can express an opinion, but I feel it my duty to say one or two words on Clauses 4 to 15 which are the vital administrative clauses from the Wheat Commission's point of view. The whole problem arises from the fact that until this Bill was produced there was no satisfactory objective definition of what wheaten substances were to be regarded as flour liable to quota payment to find revenue for the Wheat Commission, and of what wheaten substances are or are not wheat offals. That has been the cause of major difficulties of recent years. Ever since the Paul judgment, to which the noble Earl who introduced the Bill referred, the technical officers of the Ministry of Agriculture, the various interests represented on the Wheat Commission and people like the Government Chemist, have been hard at work trying to find the necessary definition without which all concerned were quite uncertain as to what would have to pay quota and what would not have to pay quota.
At this moment the quota payment that it is necessary to demand from millers and importers of flour and from merchants and the like, in order to pay British wheat growers what Parliament intended them to have, is 6s. 6d. a sack, which is a very large sum of money and makes a great difference to many people. It is important, therefore, to know exactly what a man has to pay quota on, and it is essential that there should be no doubt in the future about it. The scientists have come to our aid—and here let me say that we owe a great deal not only to the technical work of the Government Chemist but also to the chemists employed by the milling industry itself and their technical advisers, who co-operated with the Government Chemist in finding accurate objective scientific definitions. The basic and, from our point of view, the most valuable clause in the Bill is 506 Clause 4, which deals with this problem of ash content, by which you will judge whether the substance is flour liable to quota payment or whether it is wheat offals not liable to quota payment.
I will not go into further technical details except in regard to Clause 7. In another place there has been a little trouble over Clause 7 (2), and a great deal of it, I think, arose out of misunderstanding. A pledge was given in another place by the Minister in charge of the Bill that the Wheat Commission should be invited to study the debates on that subsection and to consider whether from their point of view—of course they are not to be decisive—any Amendment to that subsection was or was not desirable. The day before yesterday, last Tuesday afternoon, I presided over a full meeting of the Wheat Commission, and there were present representatives of the millers, the flour importers, the corn merchants and provender millers, the Farmers' Union, the manufacturers of biscuits, and the consumers—the co-operative movements and the rest of it. We had a full meeting of the Commission to go into this matter and we discussed it at no little length. At the end we passed a unanimous recommendation—of everybody there and all the interests—urging the Government not to make any Amendment to Clause 7 (2). That is the subsection which says that you shall not put on to the market a substance composed of wheat meal (a particular form of wheat) for feeding to livestock unless it is admixed with an equal weight of non-wheaten substance. I may say that for our afternoon meal one of the members of the Commission produced for us two admirable loaves of bread, both good in appearance and appetising in taste, which were composed of 75 per cent. of wheat and 25 per cent. of non-wheaten substance.
I think they, as well as the argument, convinced the Commission—they certainly convinced me—that if permission is given to put on the market, free of quota, wheat meal not mixed with 50 per cent. of non-wheaten substance, we shall have a large number of loaves and cakes in the bakers' shops and groceries of this country which have evaded the quota payment which it is the intention of Parliament that they should pay. Under the Act of 1932 there was a certain safeguard that these various wheaten substances 507 other than flour, the definition of which has broken down under that Act, should be "without further manufacture." I do not say that this mixture of 75 per cent. of wheat meal and 25 per cent. of rye or whatever it is could be made into a good bread without further manufacture, but in this Bill it has been the deliberate policy of the Government—and the Wheat Commission do not wish to challenge it—to do away with the safeguard of "without further manufacture." Those words are to be deleted from the Statute Book because it is in the interests of the livestock feeders, and particularly of the poultry feeders, that they should be able to get as cheaply as possible, and in the most useful form for the purposes of their industry, wheaten substances which have been further manufactured for the purposes of feeding to livestock and poultry.
So that limitation "without further manufacture," having been deleted, becomes all the more necessary unless we are to have a complete breakdown of the administration of the Act and complete facility is to be given to evade the intention to submit to quota payment flour used for human consumption to help the wheat growers. We shall have new processes and new industries started simply for the purpose of evading quota payments. In a year like the present year, when quota payments are as high as 6s. 6d. per sack of flour, there is a great incentive to all and sundry to drive a coach and four through the intentions of Parliament and to evade quota payments by delivering substances to a farmer nominally to feed livestock but telling him he can send it back to another miller so that the flour can be extracted or other manufacturing processes undertaken. Thus the whole intention of Parliament and the whole basis of our revenue could be destroyed. I have, I think, made it clear that we have always felt that.
But may I say one other thing?—and this I say not so much as Chairman of the Wheat Commission as one who is equally interested in agriculture—that one of the dangers I foresee is that, unless the provisions with regard to dilution are adhered to, there will be a tendency to put upon the market, for poultry feeders especially, not a balanced ration—that is, the best ration for the poultry feeders—but a mixture far too rich in wheat. It 508 is not desirable in the interests of stock feeders, in the interests of sound nutrition of stock or poultry, to have a mixture too rich in wheat. I think that everybody familiar with feeding will bear me out that, particularly at certain times of the year and under certain climatic conditions, corn feeding-stuff too rich in wheat is not desirable. As at this present moment wheat is very cheap, and although we expect maize will probably go down—maize at the moment is rather high—there would be that tendency, unless that further safeguard were in this Bill which is in it at present. Not only for the purpose of preventing evasion of the intention of Parliament, but also in the interests of the livestock and poultry-feeding industry itself, you should take care that you do not by the inevitable consequences of an Act of Parliament start entirely new trade habits in industries and alter existing trade habits in industries against the interests of growers.
May I say that my experience of the Wheat Commission in the last nine months has been a singularly happy one in that, though divergent interests are represented on that Commission, they have always shown themselves, ever since the passing of the Act, ready to see each other's point of view and come to fair all-round compromises? I should like, particularly in view of the last controversies that have led up to what is really the basis of Clauses 4 to 15 of this Bill, to pay a particular tribute to the part played by the representatives of the Farmers' Union, as well as by the millers, in the very able advice and counsel they have given to the Wheat Commission. Admittedly some of these complex clauses are the results of compromises worked out, or unanimously agreed, in the Wheat Commission, and I am sure that it is in the interests of a Bill of this kind that the good will and good feeling between the various sections represented on the Wheat Commission should continue in the future as in the past. It certainly will make my duty as impartial Chairman all the easier. Therefore, I sincerely hope that except for purely drafting points—nobody knows what Parliamentary draftsmen will produce at the last moment—at any rate no Amendments of substance, altering these technical clauses, which will necessitate any further meetings or negotiations and discussions in the Wheat Commission, will be found 509 necessary, and that substantially Clauses 4 and 7, in particular, will be passed by this House as they come to them from another place. I will not take up any more of your Lordships' time by talking on what is necessarily a very technical subject, but merely add that the Wheat Commission are only anxious that this Bill should reach the Statute Book at the earliest possible moment.
§ 5.3 p.m.
§ LORD CRANWORTH
My Lords, as a farmer I would e to welcome this Bill and to express the hope that it will get a Second Reading. I welcome it not only on its own merits, but because it is a fulfilment of a promise given more than once, and also because it is a first instalment of the new drive of the Government to give agriculture its proper place in our industry. As it is the first instalment of that policy I should like humbly to express my good wishes to the new Minister of Agriculture, who is introducing in another place, I think to-day, another still more important instalment of that policy. I venture to hope that the experience he has had in riding the somewhat troubled waters of 45, Bedford Square, will enable him to ride with some measure of safety the far more tempestuous seas of 10, Whitehall Place. I am rather glad that this first instalment of the new policy is in connection with arable land, because recently we have heard such a lot about grass land, and such a little about arable land—and this I think is largely due to that great genius, Professor Sir George Stapledon, who has shown to the people of this country not only what a bad state much of their grass is in, but how much of it can be made into good grass. I think it is sometimes forgotten that much of that land remains poor grass land because it is not a sufficiently good economic proposition to make it into good grass.
While considering the question of wheat, I would like to give one or two of those exceedingly dull things, figures, to your Lordships. In the first place, where 100 acres of ordinary grass land in this country produces food for twenty people, if that land is broken up, and properly broken up and put under the plough, it will produce food for eighty people, or four times as many. Of cultivable land in this country, we have less than 40 per cent. under the plough. In Germany they have over 75 per cent. 510 under the plough, and in France over 70 per cent. Here, I think, is a really very striking comparison which I know to be approximately accurate. In this country we produce the bread equivalent of 75 lbs. a year for each inhabitant of these islands. In Germany they produce just under 500 lbs. per head of the population, and in France just over 500 lbs. per head of the population. That is rather a striking difference, I feel. There is just one further figure which I think is of some interest, and it is this: although the land of Germany is generally recognised by agriculturists to be as a whole of less good quality than the land of this country, they produce in Germany, on 100 acres, 33 tons of cereals whereas we produce 15 tons.
The Wheat Act of 1932 is said to-day to be, and is generally recognised as having been, by far the most effective measure to help agriculture that has been produced of late years. It has stimulated employment, and kept land under the plough—indeed I doubt if without it arable farming would exist to-day—and I think on that account it is well worth while to study why it has been effective. I would venture to put before your Lordships three reasons. The first is that it takes into consideration the cost of production. The second is that it takes into consideration the necessary balance of agriculture, in that, as the noble Earl has said, the guaranteed price begins to go down if a certain amount of wheat has been produced. Whether that amount is sufficiently high, of course there will be a question. But it does to that extent consider the balance of agriculture. The third reason is that it is, I think, the only measure that makes use of the levy subsidy, and although there are some of us who would rather that the levy was a levy put upon the foreign exporter, nevertheless it is a levy and the levy subsidy is one of the reasons, I venture to assert, why that Act has been so successful in this country.
Taking the Bill itself, it consists of 32 clauses. One clause is of great importance, and 31 are of less importance. The first clause is the one that is of importance, because it is that clause which shows the method whereby the price given to the farmer for wheat will be reviewed. It is an old undertaking that it should be reviewed, and it is going 511 to be reviewed this year, and again at intervals of three years. It is going to be reviewed by a Committee. I am bound to say that when I first heard a new Committee would sit I was a little scared, because it has always appeared to me that when there was any trouble a new Committee was always set up. I notice, however, one good thing about this Committee. It is a Committee of three, and although there are some who say that a Committee of one is the best, I think everyone will agree that if we cannot have a Committee of one, a Committee of three is the best. The members of this Committee of three have a pretty difficult task in front of them, and I venture to press upon the noble Earl in charge of the Bill that it would be desirable that at least one of the three Committee-men should have some practical knowledge of the growing of wheat. I know it is generally considered amongst those who are not farmers that farming is a very easy job, and that everyone can do it; but as a matter of fact those who have made money, and the many more who have lost money, know that farming is not an easy job. The growing of wheat and a knowledge of all the circumstances connected with wheat are not an easy job; they are an extremely difficult and intricate job; and unless you have men with agricultural knowledge they will not even be able to weigh the evidence put before them. I therefore do most seriously suggest to the noble Earl that it would be right and proper that at least one of these three members of that Committee should have some practical knowledge of the production of wheat.
It would not, I think, be right to go far into the question of what this Committee may decide. They would have the power of keeping the price as it is now, and they would have the power of recommending the reduction of that price. I am bound to say on that that I noticed with some surprise, in the very admirable book produced by the noble Lord, Lord Addison, the statement that in his opinion the price was much too high, and that the price should be approximately 37s. 6d. I could not but think that that was a rather remarkable way of making farming pay, which the noble Lord, when he was Minister of Agriculture, as I well remember, said was the first essential for farming. On the other hand, the Committee 512 of course may put up the price, and I think it is fair to say that if the price of 45s. a quarter, which was settled in 1932, was a fair and just one—and I have heard very little criticism in any quarter as to that price—one may assume that any change would be in the direction of a rise, seeing that the cost of producing a quarter of wheat has risen by at least five shillings. I think there would be no difficulty in proving that.
Then there is a large part of the Bill, to which the noble Earl has alluded, which concerns the extracting of quota payments for substances containing wheat flour from people who have so far failed to pay their proper quota. Most of these clauses are quite unintelligible to the layman, and at one time I should have thought that such unintelligibility was rather a cause of annoyance, but as I mellow with old age I do appreciate that those who draft Bills have a very dull and dreary life, and I feel that it would be somewhat churlish on our part to grudge them their little amusements, of which I feel this Bill must have been one of the greatest
I have only one more criticism, and that refers to Clause 27, which has not yet been alluded to, in which power is taken to increase the number of members of the Wheat Commission from seventeen to twenty. Seventeen seems to me to be a very handsome figure for a Commission; indeed I venture to say, from my experience of Commissions or Committees, it is a great deal too big. It becomes almost a debating society. Seventeen people are quite capable of spending the whole day discussing a thing which three will finish in a remarkably short time, and I find it very difficult to believe that the addition of three to make the round number of twenty is likely to have any good effect. I hope that the noble Earl will at a later time explain the reason for this addition. I feel that this Bill is a small, but nevertheless useful, start in the great efforts that the Government are making to place agriculture not only in its proper position but on an equal footing with the other great industries of this country, and I am quite sure that your Lordships will give it a Second Reading.
§ 5.15 p.m.
THE EARL OF RADNOR
My Lords, I intervene for a very few minutes only 513 because, as the noble Lord, Lord Cranworth, so rightly said, this is a very difficult Bill to understand. When I read it, I tried to do so with understanding, and I am afraid I failed completely. But I read sufficient to realise that it was a Bill which was designed to fill in the gaps which experience has shown to exist as the result of the original Wheat Act. I also read sufficient to find out that there was one gap of which I am quite certain the noble Earl in charge of the Bill has knowledge, but which is not touched upon in this Bill. One of the results of the original Wheat Act has been that in a great number of cases there has been on farms an excessive cropping of wheat, with the result that the fertility of the land concerned has been decreased very considerably. The fertility of the land is a very important national matter.
As my noble friend Lord Cranworth mentioned, there is a further Bill in another place, I believe being debated to-day, which deals with various matters, among other things oats and barley, and in that Bill it is proposed that those who receive assistance for the growing of oats and barley should be under a penalty of some reduction of their assistance it their cultivation of the crop is not adequate and does not have regard to the fertility of the soil. So far as wheat is concerned, there is absolutely no provision that I know of to ensure anything similar; that is to say, the wheat grower can, if he wishes, virtually grow wheat crop after wheat crop, to the detriment and pauperisation of his land and to the harm of the country. I think that is something which should be remedied. In the old days, when the landlord had the power, he saw to it that his land did not depreciate. To-day the landlord virtually has no such power, and his tenant can almost do as he likes. Further than that, there is a great deal of land in this country to-day not farmed under the landlord and tenant system, and I am informed that in some cases the trouble has got so far that there are so-called farming companies who buy land, grow wheat on that land by mechanical cultivation and the cheapest possible methods for so long as they can continue to grow any wheat at all, and then sell the land, go and buy elsewhere and start all over again. Whether that is true or not I do not know of my own knowledge, but 514 I am informed that it is so, and that is a disastrous thing for the country. I hope that the noble Earl may be able to tell us in his reply whether the Government have anything in their mind to ensure that that process which is now going on will be put a stop to.
I feel fairly certain that the answer that will be given is that in the case of wheat the assistance given is on the yield of the wheat, and is not a per-acre assistance. That is so, and it should work, but the fact is there that it does not work, and that too much wheat is, in cases, being grown, to the detriment of the land, and the position has not been helped by the increase in the total volume of the wheat which ranks for assistance. I do not know whether any Amendment is suitable to this Bill, which is so largely a Bill dealing with the machinery of the administration of the original Act. I am quite certain that it cannot go into the Bill which is being considered in another place, because that does not mention wheat, but it would be helpful if the noble Earl could give some reply to that question.
§ 5.20 p.m.
THE EARL OF FEVERSHAM
My Lords, as is customary in your Lordships' House, we have this afternoon had the advantage of listening to a debate of a high standard in respect of agricultural matters, which is all the more interesting because of the fact, traditional in your Lordships' House, that we have not confined ourselves to the strict limitations of the Bill before the House. If we had done so, the House would have been unfortunate in losing the particularly interesting figures provided by the noble Lord, Lord Cranworth, in respect of the proportion of arable cultivation in this country and Germany. I should be much interested, as indeed other members of your Lordships' House will be, to look more closely into those figures and to have an opportunity of analysing them before making any comment on them. It is sufficient to say that the noble Lord must be well gratified, as he has this afternoon pointed out, that not only does this Bill amend the Wheat Act of 1932 so as to obtain an efficient administration, but the Bill which is at present before another place is likely to give incentive to all those with potential arable land to increase their cultivation owing to the fact 515 that for the first time they can receive State subsidies on barley and oats as well as on wheat.
The noble Lord, Lord Snell, in his opening remarks, referred to the fact that he was apprehensive that the Wheat Act, which placed, in his opinion, a financial penalty on consumers, was in effect working to the benefit of the millers and merchants rather than of the farmer. Lord Harlech has spoken in reply to that question, but I should like to add that, in the first place, it can be said that the country with its vast number of consumers is better off with the Act than without it. I say that for these reasons. As the noble Lord, Lord Harlech, indicated, the Act had resulted in an increase of the area under wheat in this country from an average of a little over 1,300,000 acres in the three years 1929 to 1931 to more than 1,900,000 acres in 1938, which is an increase of nearly 50 per cent. This increase in peace time naturally means a reduction in our dependence upon imports, which must undoubtedly be a potent factor in preventing high prices in times of world scarcity, and if war should come its importance is likely to be out of all proportion to its cost. The noble Lord, Lord Snell, referred to the increase in the price of bread to the consumer. I have had supplied to me figures which show that over an average of the seven years of the working of this Act the increase has been something less than one farthing per 2 lb. loaf, so in these circumstances, thinking not only of the conditions and the times in which we live but also of the possibility of an emergency, it seems that the fractional premium paid by the country at large is well worth while.
I am very gratified to learn from the Chairman of the Wheat Commission that at a meeting recently held they decided with unanimity that Clause 7, subsection (2), of the Bill was satisfactory as it stood. The noble Lord has gone into the technical question relating to that clause, and I would say for the information of this House that Amendments were only moved to the clause as it originally stood because representations were made on behalf of the small millers and farmers that the percentages of dilution were not satisfactory. Therefore we proposed that it should be in the ratio of 75 per cent. to 25 per cent. instead of the 50–50 basis. Finally, another place reversed its former criticism, 516 and I am glad to hear that all parties represented on the Wheat Commission are agreed that the clause is better as it now stands.
The noble Lord, Lord Cranworth, referred to the Standard Price Committee which is set up under Clause 1, and he made the comment that, although the complement of the Committee would be right, it was at fault because of the fact that no person qualified in agricultural practice was to serve on the Committee—at least that was not laid down in the Bill. I would point out to my noble friend that the terms of reference of such a Committee cover questions as to which it is essential to have an unbiased opinion and impartiality. If the noble Lord refers back to the Report of the 1935 Committee, he will there find that the Committee dealt with such wide subjects as the world supply of wheat, the price of bread to the consumer, and other similar matters. Therefore it would be unwise in this particular instance to specify that a member of that Committee should have technical knowledge of the practices of agriculture.
Lord Cranworth expressed doubt as to the wisdom of setting up further Committees. I agree with the general sentiment, but I would point out that this is not a new Committee. It was provided for in the original Act, and it has already served its purpose by submitting one Report. It is intended that a similar Committee should be set up so that in this year it will have an opportunity of making the recommendation that the noble Lord calls for, in view of the fact, as he has told the House, that the cost of production must have gone up considerably since the original Act was passed. The noble Lord also referred to the size of the Wheat Commission. I am informed that it is necessary to add to the size of that Commission in order that there may be room for representatives of the breakfast food industry should that be desirable. I am also told that the section that is represented by the smaller millers consider that their representation is insufficiently large, and it has been proposed by the Wheat Commission themselves that it should be augmented. There can be no doubt that my noble friend Lord Harlech, who has shown such great skill in the management of the Commission of its present size, will be able to conduct with equal skill the affairs of the larger Commission.
517 My noble friend Lord Radnor referred to a matter of very great importance when he stated that in this Bill there is not a provision similar to that which is included in the Agriculture Act, 1937, and which is also included in the Agricultural Development Bill at present being debated in another place in respect of the maintenance of the fertility of the arable areas. The Government, of course, are fully alive to the undesirability of any form of cereal subsidies encouraging bad cultivation or leading to over-cropping and thus diminishing the fertility of the soil. There is no doubt that in the last two years there has been a great deal of cross cropping—wheat followed by wheat—which in many instances has led to a reduction of fertility. But the answer to the point why a provision of the character to which the noble Earl referred is not included in this Bill, is the one which was indicated by the noble Earl himself. I am inclined to think, from the experience I have had at the Ministry, that administrative difficulties can generally be surmounted—difficulties which have resulted as often as not in complicated legislation which has come before this House. But in this case I do not think that can be done.
It is proposed in this Bill to make payment by way of monetary subsidy which falls eventually upon the consumer. In the case of barley and oats it is a subsidy on an acreage basis, and in the case of those two crops it is easy for the 300 crop reporters and the staff of the Ministry of Agriculture to see that a crop is negligently cultivated or that because the land has had cereal cultivation in previous years its fertility has been injured. In the case of the wheat payment it is impossible to differentiate between the production of one field and another field because payment is only made through the channels of the middleman. In fact it would be administratively impossible to work. But if a fanner crops his land consistently with cereal crops without any intervening root crops, his oats and barley subsidy payments can be reduced under the new Bill, so the position is improved to this extent, that the fertility of the land will only be impaired by the farmer who grows wheat upon wheat.
It is to be expected that the assistance that is to be given to the oats and barley 518 growers will help to restore that better balance between wheat and other cereals to which my noble friend Lord Cranworth referred. We shall have an opportunity of debating that very important question at a later stage when the Agricultural Development Bill comes before this House, but I hope my noble friend Lord Radnor, and those he represents on the Central Landowners' Association, will see the reason why such a provision as he has advocated cannot be incorporated in this measure, which is essentially one of a technical character. I regret that I have not dealt with all the points raised, but I hope at least that I have covered some of the main criticisms that have been put forward in the course of the debate.
§ On Question, Bill read 2a, and committed to a Committee of the Whole House.