HL Deb 01 August 1940 vol 117 cc78-90

4.16 p.m.

THE DUKE OF MONTROSEhad the following Notice on the Paper: To ask His Majesty's Government whether they are aware of the grave dissatisfaction among farmers, especially hill farmers, over the 1940 wool clip prices; and whether they are aware that the Wool Advisory Committee was not consulted, as definitely promised, before the prices were fixed; and to move for Papers.

The noble Duke said: My Lords, I should like to apologise for again bringing before you such a tedious subject as that of rural sheep-farming in the hills of Scotland and the price of wool. I should not do so if I had not thought the situation was really rather serious. In April last I spoke to your Lordships about the seriously low price for wool and how it was uneconomic and ruinous to hill farmers in Scotland. I left your Lordships' House after that debate, and after the very sympathetic and charming speech of the noble Lord, Lord Temple-more, thinking and feeling that something was going to be done to rectify the defects which I had pointed out; but I am greatly disappointed to say that things have got worse and worse. If the position was bad in April, it is absolutely ruinous now in August. I should have made up my mind at once to go out of sheep farming for good and all if it had not been that I heard a very eloquent speech from the Secretary of State for Scotland in which he said that two breeds of sheep, Cheviot and black-faced, are the foundation of the main sheep stocks of the low-lying farms and any reduction in their numbers would be a calamity to the country. That is absolutely true: it would be a calamity to the country, because those two breeds together constitute about 6,000,000 sheep—far and away the largest sheep business in this country.

At a time like this, when we are discussing how to increase our food production, it seems ridiculous that some of us may have to sweep our sheep off the hills altogether because we cannot make them pay. After all, the black-faced sheep are the only livestock in this country that require no importation of feeding stuffs. Every other livestock in this country now requires to be fed with imported feeding stuffs but black-faced sheep, and it seems to me extraordinary that some of us should be brought to ruin and be unable to carry on at a time like this simply because the prices are uneconomic. We farmers were disappointed in the autumn, but we decided to carry on, hoping that things would improve, and our hopes were based on the fact that a Wool Controller was appointed with an advisory committee. Our farming interests were represented on that Wool Advisory Committee, and we were assured that that Committee would be consulted before the 1940 wool clip prices were fixed. The Minister of Supply and the Secretary of State for Scotland both gave a definite assurance that the Wool Advisory Committee would be consulted before the 1940 wool prices were fixed, and the noble Lord, Lord Temple-more, gave me a definite assurance to that effect.

LORD TEMPLEMORE

My Lords, I really must interrupt the noble Duke, because he is saying something which I thought that he might say, but I have referred to the speech which I made on April 3, and what I said then was that the farmers would be consulted. While I do not wish to anticipate the speech which my noble friend (Lord Alness) will make later on, I think that when he comes to make that speech the noble Duke will find that the farmers were consulted on April 12, nine days after I made my speech.

THE DUKE OF MONTROSE

My Lords, I certainly took the words used to mean that the Advisory Committee would be consulted. The noble Lord said: The noble Duke asked me during the last part of his speech whether fanners were going to be consulted before prices were fixed for 1940. As I have already told him, the answer is Yes. All that I can say is that the Advisory Committee have not been consulted. What I think that the noble Lord has in mind is that there was a deputation which went to see the Secretary of State for Scotland, and on that deputation the farming interests were represented. That deputation came not from the Advisory Committee but from the Farmers' Union and the Chamber of Agriculture. There were on it two or three members of the Advisory Committee. A number of matters connected with agriculture was discussed. There was some mention of wool by members of the Advisory Committee, but, as your Lordships know, what is said when a deputation is received is a very different thing from what is said round a table with an Advisory Committee. That deputation was given a hearing, as all deputations are when they are received by Ministers, and there the matter ended. That, as I say, is a very different thing from a discussion round a table with an Advisory Committee specifically appointed to deal with the price of wool; by no stretch of the imagination can a deputation be called a substitute for discussion with the Wool Advisory Committee.

I was astonished, therefore, when the Secretary of State for Scotland announced that the prices of wool were fixed by him after consultation with his Departments. What has it to do with the Departments? They are not producers of wool. It should have been done in consultation with the Advisory Committee. We feel very strongly that, in spite of the assurances which were given to us, we have been badly let down. I have to admit that the prices of wool have advanced in some degree. Last autumn the price for black-faced wool was 10d. per lb., and to-day it is 1S. 0½d. Cheviot was 1S. 0¼d. per lb., and to-day it is 1S. 3½d. The Secretary of State for Scotland says that there has been an advance over prewar prices of 64 per cent, in the case of black-faced and 45 per cent, in the case of Cheviot, but where does that advance begin? The pre-war prices were 4½d. per lb. for black-faced and 7½d. per lb. for Cheviot, so that advances of 64 per cent, and 45 per cent, respectively do not make the prices economic. In the last war, black-faced wool started at 7½d. per lb., 3d. per lb. higher than it started in this war, and the price, which was regulated by the Government, was advanced until it was IS 1½d. per lb., a penny more than it is; now. To-day the costs of sheep farming have risen, and wages are 54s, as against 30s. during the last war. Surely there must be something wrong with to-day's prices, when the prices in the last war were higher in the beginning and higher at the end, and when wages were lower. Everything is against the fanner to-day as compared with the position at the beginning of the last war, and there must be something wrong.

The fact remains that the prices fixed by the Wool Controller are not economic as they stand, and they require reconsideration. The Wool Controller will say, of course, that the present conditions of the wool trade do not permit higher prices to be paid, but I do not see why that should be so. The Wool Controller makes a very big profit indeed, as will be seen by comparing the prices at which he requisitioned the wool in October with the prices in March at which he handed over the very same wool to the manufacturer. There is a difference of 6d. per lb. between the two, which means 2s. 6d. to 3s. for handling a single fleece. That is a ridiculous price difference, especially in view of the fact that the fleeces are put free on rail by the farmers and sent to whatever destination the Wool Controller selects. The Wool Controller does not handle the fleeces at all; a 2½d. stamp covers all that he does, yet he charges 6d. for every lb. of wool or 3s. for a fleece. Out of the enormous profits which he makes he could very well afford to advance the price to the producers by 2d. per lb. at least.

Moreover, the Wool Controller asks the farmers to keep all the wool on our premises for him. Space on our premises, however, is exceedingly valuable and is wanted for other things; nevertheless we have to give it up. We have to insure the wool while it remains on our premises against war risks, fire and so on, and we have to pay the insurance premium. We have to deliver the wool to where we are told to deliver it by the Wool Controller, on the railway or anywhere else, and we farmers pay for the freight and transport. We say that all the expenses in connection with the wool should begin where the control begins. The Wool Controller takes control of the wool immediately it leaves the sheep's back, and all the expenses connected with insurance and freight should be borne by the Wool Controller. If that were done it would be equivalent to giving us 1d. or 1½d. per lb. on the price of wool. I do think, therefore, that the Wool Controller could very well afford to give us a better price.

I said last April that if I was disappointed in the price of wool I, like many others in the same position, would have to give up sheep farming. What does that mean? I said that I had two farms that I should have to clear. I have balance sheets, audited by chartered accountants, for those two farms for four years past. The figures are submitted to the Inland Revenue authorities for reclaiming Income Tax and are accepted, so that there can be no question about them. They show that I have lost money for four years on those sheep farms, up to £900 at least. There are many other sheep farmers who could show the same thing. If I clear the sheep, it means that 3,500 sheep will be driven off the hills. They are the potential breeders of succeeding generations of sheep, yet they are being driven off the hills to the butcher now. The hills are left derelict—derelict absolutely for the deer to come down on. It seems wicked and wasteful to carry on a policy in which we are going to clear away the sheep for deer, simply because we cannot make sheep farming pay.

And another point has arisen now. A new lot of minimum wages has come out, published on July 12. I am not sure whether those new minimum wages were considered when fixing the price of wool. The Advisory Committee ought to know but the Advisory Committee, as I said, were not consulted, and we do not know. Were the new minimum wages considered when fixing the price of wool? They are now to be 54s. for shepherds. That is an advance of 10s. a week or £26 a year additional charge on a farmer. With that great increase of wages we simply cannot carry on this business. I would like your Lordships to know, however, that none of us farmers in the least grudge the advance of wages to shepherds of 10s. a week. We approve of it. They are the finest men in the country, and they thoroughly deserve the increase, especially when we see the munition workers, who used to get £3, getting today £10, £12 or £15 a week. All that we farmers ask is that we should be given prices which will cover the cost of production, including these new wages.

I am sorry to say that, as a result of all that has happened, we sheep farmers have absolutely lost confidence in the system of Wool Control. We have heard over and over again that the one thing farming has suffered from is a lack of confidence. Well, we have lost all confidence in the Wool Control, because the assurances given to us have not been kept. And the system is wrong. It is quite right that we should have an Advisory Committee. After all, we are now setting up an Advisory Committee for poultry to discuss the question with the Food Controller. On that Committee we have representatives of the retailers, the wholesalers, the auctioneers and the consumers, and he sits day by day with that Advisory Committee before he fixes the price of the eggs and the poultry. If that principle is right for poultry and eggs it is surely right in the matter of wool. We disagree with the whole present system. I will say nothing whatever against the personality of the Wool Controller—far from it; I believe he is a most estimable gentleman in every way. But I think it was my noble friend Lord Elibank who told us here in April that unfortunately the Wool Controller was a Bradford wool merchant. There is no harm in being a Bradford wool merchant, but what we do feel is wrong is that the Wool Controller should have any connection with wool. He is judge and jury in the case, and what we feel is that the Wool Controller should be an absolutely independent business man, supported by an Advisory Committee representing all the different connections with wool—the producers, the merchants, the manufacturers, the exporters and so on.

I think that idea is supported by what I saw in The Times this morning. Speaking in another place in reference to homegrown timber, the Minister of Supply said he did not think it was desirable that a person actively connected with the trade should be appointed to the Timber Control Board, and that it was proposed to invite the home-grown timber people to set up a Committee to consult with an absolutely independent Timber Controller. If that principle is right for the Minister of Supply in respect of the Timber Control, it is right for wool. We should have a completely independent Wool Controller. If we have that, I believe the Government will regain the confidence of the wool and sheep farmers. If we do not get an independent Control, all I can say is that we shall have no further confidence; which is regrettable in these days when you depend upon us to produce sheep and wool in a war emergency. I beg to move for Papers.

4.46 p.m.

LORD ALNESS

My Lords, the noble Duke has raised a subject which is of the first importance and interest to the whole agricultural community, and he has supported his view, if I may say so, with his usual force and eloquence. The subject concerns not only Scotland but England and Wales as well, though my noble friend chiefly stressed the Scottish aspect of the question. This is not surprising because, after all, the sheep farming industry in Scotland, having regard to the population of the two countries, is relatively much more important on the other side of the border than it is in England. Moreover, a third of the sheep in Great Britain are to be found located in that country, and of these sheep I am informed that 80 per cent, are either Cheviots or black-faced sheep such as the noble Duke has referred to, and they are mainly found upon the hillsides, of Scotland. In these circumstances I have been asked by the Secretary of State for Scotland to reply to my noble friend; and while I cannot profess to have the practical knowledge and experience which the noble Duke possesses, I may perhaps be allowed to remind him that during the six years when I had the honour of being Secretary for Scotland I also was head of the Board of Agriculture in that country. Therefore I am not entirely unacquainted with the various problems of agriculture, problems ranging from braxy and grass sickness on the one hand to hill farming on the other.

The problems are infinite, and one has had to deal with this particular problem in past years, when the industry was subject to some of the difficulties which still continue to-day. To the hill farmer un-questionably the price of wool is of cardinal importance. That I at once admit. His return from wool may amount, so I am informed, to some 20 or even 30 per cent, of his total income. The proportion is variable, depending upon a number of variable factors, but at any rate it is an important source of income, and I want to say at once that that is fully realised by His Majesty's Government. Now the noble Duke's question falls into two distinct parts. Perhaps I may be allowed to deal first with the second part. In the second part he asks why "the Wool Advisory Committee was not consulted, as definitely promised, before the prices were fixed" Let me say at once that I am quite unaware of any such promise having been given. The promise given by my noble friend Lord Templemore in this House, when the matter was debated on April 3, was in the following terms, as my noble friend Lord Templemore has pointed out: The noble Duke asked me during the last part of his speech whether farmers were going to be consulted before prices were fixed for 1940. As I have already told him, the answer is Yes. In giving that undertaking my noble friend Lord Templemore was reiterating an undertaking which had already been given in another place by the Minister of Supply in answer to a Parliamentary question in December of last year What my right honourable friend said at the time was this. He undertook to meet the farmers in the spring and discuss with them "the principles on which the 1940 clip should be dealt with."

These are the only two undertakings of which I know—one given by the Minister of Supply, the other given by my noble friend Lord Templemore. The terms of the undertaking were perfectly specific—an undertaking to consult, not with the Advisory Committees, but with the farming industry before the prices were fixed. What followed? In pursuance of that promise, my right honourable friend the Minister of Supply met the farmers of England, Wales, and Scotland on April 12 of this year. I am not aware that that was in the form of a deputation; I would rather term it a conference. I have before me the names of those present, and all I can say is that a more representative company of persons representing all farming interests in both countries could scarcely be conceived. That deputation, as my noble friend has called it, or conference, was attended by representatives of the National Farmers' Union in England and the National Farmers' Union and the Chamber of Agriculture in Scotland, and by a variety of other bodies connected with agriculture. At that conference they fully set out their arguments for an increase in the price of wool for 1940.

It is true that in the course of that conference, the Minister of Supply undertook that the British Wool Central Advisory Committees, which are the Committees to which the noble Duke referred, should be convened, but at the same time he made it perfectly clear that on the question of price what he proposed to do was to discuss that matter with the Minister of Agriculture for England and the Secretary of State for Scotland, and then to consult with the Treasury. I cannot find any trace of any undertaking given by the. Minister of Supply or by any responsible person at any time to consult with the Advisory Committees on the question of price. A moment's reflection would convince the noble Duke, I think, that any such proceeding would in the circumstances have been supererogatory and indeed otiose. After all, a meeting had been held representing agricultural interests in all the countries concerned whereas the Advisory Committee is a small body—an important body no doubt; but why it should be thought necessary or desirable to consult that body when the larger body of all the farmers concerned had been already consulted, I fail to see. There is this further consideration. It was quite clear that in the price to be fixed there was an element of subsidy, and it appears to me—at least I so apprehend—that it would have been inappropriate that the Advisory Committees should share in what, after all, was a decision involving matters of broad agricultural policy. Accordingly, I reach the conclusion that any undertaking given by a responsible person has been fully honoured and implemented, and with that I pass to the other part of the noble Duke's Motion which relates to the prices themselves.

The Motion refers—and now I quote—"to grave dissatisfaction among farmers, especially hill farmers, with the 1940 wool clip prices." The Ministers concerned, I may say, are under no illusion with regard to the existence of that dissatisfaction, but in that regard there are several considerations which must be carefully and studiously borne in mind. In the first place, the markets for wool have, for years, been notoriously unstable. No recent period of years could be found which could reasonably be regarded as normal for the purpose of assessing, from an agricultural point of view, the needs of the situation. The farmers themselves proposed to go back—they found it necessary to go back in support of their case—to a period prior to the last war. The Government felt that to go so far back for the purposes of comparison was really not practical politics. The Government's efforts were directed to finding a price which would ensure for sheep farmers adequate returns, substantially better than those received during the depressed conditions of recent years to which the noble Duke has referred. The prices which have been fixed were fixed in view of all the existing relevant considerations and circumstances. In particular, the noble Duke asked me whether the projected increase of wages was taken into account in fixing wool prices. It certainly was, and it was taken into account in fixing sheep prices as well. Accordingly, it is vain to suggest that this decision, whether it be regarded as a good decision or a bad decision, was not taken in the light of all relevant circumstances, including those which the noble Duke insisted were material.

I pass to the prices themselves. I apologise to your Lordships for the length of my reply, but the speech which has been made was a comprehensive one, and I do not propose to detain your Lordships more than a few minutes more in endeavouring to reply to it. The prices which have been fixed represent a very substantial increase upon the prices that prevailed before the war. The increase, as the noble Duke indicated, in some cases is 65 per cent, and in other cases 45 per cent. In announcing his decision, the Minister made it clear that these prices included, as they must, an element of subsidy. Let me develop this for a moment, if I may, because it is not fully understood in certain quarters outside your Lordships' House. British wool constitutes only a small part of the total wool used in the United Kingdom. The price of wool issued by the Wool Control has to be determined mainly with reference to the cost to the United Kingdom of imported wool. Any prices which are fixed above that limit and in excess of the economic price must be regarded as a subsidy, and the justification for that subsidy must rest on the shoulders of the Ministers of Agriculture, who must accept responsibility for it.

Just let me add this. Important as wool is, especially to the hill man, nevertheless he has other sources of income which, I venture to think, are even more important, and the action which has been taken by the Government with regard to prices for fat sheep and cast ewes, as my noble friend knows so well—prices have advanced by 2d. a lb. in the one case and 3d. in the other—should certainly bring a firmer tone into the hill sheep farming industry. The first lamb sales in Scotland, I am informed, show a promising upward trend, and if, with the prices for sheep and wool at their present figure, the hill farmer cannot make a start towards greater prosperity, then I fear there is something fundamentally wrong—something which cannot be adjusted or cured by any artificial manipulation of the prices of wool in what we all hope will be the short period of wool control. It may be necessary to examine the position from the broad standpoint of the whole agricultural industry and the improvement of pastures. But these questions lie outside the range of the debate to-day, and I abstain from further comment upon them. My noble friend the Duke of Montrose referred to the Wool Controller. I do not understand that he made any attack upon the Wool Controller as an individual, nor an attack upon his impartiality in the discharge of his duties. After all, the question of control seems to me to be one not only for the Wool Controller, but perhaps even more for His Majesty's Government, who are responsible for policy in the matter.

Therefore, my Lords, without detaining you further, I would sum up by saying this. The only promise to consult the farmers has been amply and rigidly fulfilled. A promise to consult the Advisory Committee on the fixing of wool prices was never given. As regards the prices themselves, I do not desire to repeat what I have already said. They seem to me to be not only reasonable but, in the circumstances, generous, being eked out by a very substantial Government subsidy. I want finally to assure the noble Duke and the House, and, if I may, the country outside, that the Secretary of State for Scotland is fully alive to the importance of the whole sheep farming industry, which the noble Duke has so properly stressed, and that he will neglect no practical means which are open to him to assist that industry in the difficult time through which undoubtedly it is now passing.

LORD HUTCHISON OF MONTROSE

Would the noble Lord who has replied for the Government refer to the point made by the noble Duke about the cost of transport of the wool? The procedure in regard to this is quite different from that adopted in the case of Australian wool, which is put free on board.

LORD ALNESS

My Lords, if I did not deal in terms with that particular point it was not that I had forgotten it. I think one must admit that expenses have mounted in wages and transport in every department of industry. Not only this industry but other industries as well have experienced those increases, and it was while keeping in view the amount and the increases of those expenses that the prices were fixed. This and other relevant considerations were certainly borne in mind before the decision was reached. That is all I can say to the noble Lord.

4.53 p.m.

LORD BALFOUR OF BURLEIGH

My Lords, when I came to your Lordships' House this afternoon I had no intention whatever of inflicting a speech upon you, but having heard the speech of my noble friend the Duke of Montrose and the Government reply, I feel impelled to lift my voice in protest against the very unsatisfactory nature of the reply which has been given. The noble and learned Lord gave a defence from what, without offence, I might call a Departmental brief. He showed great sympathy. He said the Secretary of State for Scotland was fully alive to the importance of the sheep farming industry and so on, and sympathy was offered to a very considerable extent; but I must say, having heard what the noble Duke said, that sympathy is. I think, rather less than the occasion [...]quires. In particular, the point made by my noble friend below me (Lord Hutchison) does seem to require more attention. The noble Duke said that the Control takes the wool from the moment it leaves the sheep's back and spends nothing upon it. The fanner has to pay the transport, insurance, and all incidental expenses, and the Control is taking, according to the noble Duke, 6d. a lb. profit for which the Control does not seem to be doing anything adequate. The noble and learned Lord who replied said that the price was fixed having regard to all these considerations, but that does not meet the criticism, and if it is the best that the noble and learned Lord can offer us, then I think my noble friend ought to take an early opportunity of returning to the subject.

4.55 p.m.

THE DUKE OF MONTROSE

My Lords, I thank the noble and learned Lord very much for his interesting and informative reply. I do not think it will give satisfaction to the farming community, but I do not propose to occupy any more time just now, and for the moment I will withdraw my Motion.

Motion for Papers, by leave, withdrawn.