WHITE FISH SUBSIDY (UNITED KINGDOM) SCHEME, 1956 (Hansard, 24 July 1956)

EARL ST. ALDWYN
My Lords, with your Lordships' permission I will deal with the two White Fish Orders together, because they concern complementary aspects of the Government's fisheries policy. That policy is to subsidise the inshore, near and middle water fleets while modern vessels are being built, and to encourage the building of these modern vessels by providing grants towards their cost. By this means, and with the help of international measures for the conservation of fish stocks, we hope to have a fairly up-to-date fleet within the next seven years.
The White Fish Subsidy Scheme now before the House makes changes in both the amount and the form of the subsidy for near and middle water vessels. It also alters the form of the subsidy for certain smaller seine-net vessels, and it makes changes in the arrangements by which the crews of fishing vessels share in the subsidy. No change is proposed in the inshore subsidy. Mainly because operational costs have been rising faster than earnings, we propose to increase the subsidy for near and middle water steam vessels by about £650,000, and that for motor vessels by about £50,000. The 99 seiners and inshore boats will continue to receive the same total subsidy as at present, because from the information we have we do not feel that any change is needed.
Earlier this year we conducted a special inquiry into the financial position of the inshore fishing industry and I remember that the noble Earl, Lord Listowel, when he heard that we were going to do this, asked that, when the inquiry was complete, a statement should be made about the state of the inshore fishing industry as a whole. Of the thousand inshore fishermen whom we approached in England and Wales only 116 replied, and only half of those replies were of any value. In Scotland the response was better. However, as I have said, such information as we have from this and other sources does not suggest that a change is needed. As to the form in which the subsidy is paid, I ought perhaps to mention that the near and middle water subsidy has been much simplified. We propose to turn it into a flat payment per day at sea, instead of the present combination of voyage and landing subsidy.
There is one other change affecting near and middle water trawlers. When the white fish subsidy was introduced in 1950 it was viewed as compensation for the falling prices of fish. As a large part of the pay of the crews of fishing vessels depends on the vessels' earnings we felt it right that the crews should share in the subsidy. The subsidy was therefore reckoned as part of the gross proceeds of the catch. Now the subsidy has come to be related to rising costs, rather than to prices, and, as costs do not directly affect the crews—those whose pay is settled on the vessels' gross earnings—we think that it would be anomalous for these crews to continue to share in increases in the subsidy. The Scheme provides that they shall keep their customary share up to the point at which the new rates exceed those now in force, but they will not share in any increase beyond that.
As matters stand at present, these subsidies are clue to end in March, 1958, but we propose to introduce new legislation next Session to authorise payment of the subsidy up to 1961 or, if necessary, to 1963. We also intend to provide for 100 grants towards converting coal-burning vessels to oil-burning. The remaining Scheme is much less complex. It merely increases the maximum grant for new near or middle water trawlers from £25,000 to £30,000, because of rising building costs, and frees grant-aided vessels engaged in long-lining from any limitation on the number of voyages they may make to distant waters. I am sure that the continuation of these subsidies and the changes we are proposing will help towards our ultimate aim of a strong and independent fishing fleet. I therefore commend the Scheme to the House and beg to move that it be approved.

§ THE EARL OF LISTOWEL
My Lords, this is the first chance we have had this year of discussing fisheries, but as your Lordships have much more important Business on the Order Paper I shall emulate the brevity of the noble Earl opposite. Perhaps I may remind your Lordships that when we last discussed this matter, in December of last year, those of us on this side of the House were far from satisfied by the Scheme then submitted by the Government in relation to the white fish subsidy. We said that it had been hastily drafted before any real effort had been made to find out about the trading results of inshore fishing, and we were also dissatisfied with the halving of the original cut in the subsidy as a direct result of Parliamentary pressure. I am glad to observe that the Government have not repeated either of these mistakes in the Schemes before us this afternoon.
These Schemes have been carefully prepared after intensive research by the noble Earl's Department and the Scottish Office into the costs, as well as into the earnings of inshore fishermen, and indeed of the near and middle water fishermen as well. They are based on information which the Government have been able to collect about the finances of the fishing industry. It is not surprising that when these Schemes were discussed in another place they had a much better reception from Members representing fishing ports 101 than had the previous Scheme. These three Schemes (perhaps I may speak to the Scottish Scheme at the same time as the two other Schemes), in my view, which is shared by other noble Lords on this side of the House, are essential to the fishing industry if it is to survive until it can pay its way, as we all hope it will be able to do, and dispense with subsidies altogether.
I should, however, like the noble Earl to bear two points in mind. They are these. As I see it, the Government's policy has two main aims: first, to prevent the bulk of our fishing fleet from going out of commission because it is working at a loss with out-of-date equipment—the noble Earl will correct me if I am wrong; and secondly, to provide the financial assistance that this antiquated industry requires in order to replace steam by motor trawlers, and thus pay its own way. I have prefaced my remarks by those observations on policy because my criticisms are linked with this matter of policy. I think there is a danger that in practice the two aims may become incompatible. I take it that, as time passes, and as more and more steam trawlers are replaced by motor vessels, the subsidies will taper off and gradually stop. That is what we all want to see. But I agree with the noble Earl that the time for reducing these subsidies is not the present moment. I think he has done wisely to exempt the fishing industry from the economy campaign which the Government are trying in other directions.
Those are the two points about which I am worried, and about which I should like to be reassured. I am not at all sure whether the additional expenditure which will be made under these Schemes, increasing the total amount of the subsidy by £2½ million—a very substantial increase—will always go in the right direction. I am concerned lest too much may be going in some directions, and too little in others. What I should like to be convinced about is that inshore fishermen are not getting too little and the owners of the larger steam trawlers too much.
Your Lordships will remember that in December of last year—a very short time ago—the inshore subsidy for these small men was cut from 10d. to 8d. a stone of landed fish. They were the only section of the industry where such a cut was made. Since the start of the year the 102 costs of inshore fishermen must have risen considerably, like the costs of the near and middle water fishermen; yet these men alone will get no increase. I know that the Minister has explained that he has not succeeded in getting information about the accounts of the English and Welsh fishermen, who seem to be much less business-like than their Scottish counterparts—something which, I am afraid, happens not only in the fishing industry. So long as this vital information is lacking, I do not see how the Government can be certain that what the fishermen are getting from the sale of their catch is, in fact, greater than what they are spending on their gear, their tackle, wages, and so on. It has been pointed out that many of them are already in debt and are finding it hard to keep up with interest payments on their loans. I hope the Minister will watch the position of these small men very carefully; that is all I am asking for. If he finds that they are in danger of being forced out of business, owing to their indebtedness. then surely when the time comes, their share in these subsidies should be increased. We certainly cannot allow this important section of the fishing industry to go bankrupt.
The second matter about which I feel some misgiving is the amount of the grants being made to large and inefficient steam trawlers. The largest will get £22 a day for every day out fishing; the next largest will get £19 10s. 0d. a day. While we all want these coal-burning vessels to be kept in commission until they can be replaced, I feel that there is a very real danger that a subsidy of this size will remove the incentive to the owners to replace them. Why should the owners go to the expense of buying new boats or engines if they can make a reasonable living with their present craft? I hope they are not being cushioned in any way by these payments. I should have thought that the aim in fixing the amount of these subsidies should be to afford a bare livelihood but no more. Otherwise we shall not get the replacement we want. I hope the Government. will make it clear to the owners of these older vessels that subsidies do not go on for ever and that they must expect them to be reduced and eventually, stopped.
103 I welcome what the Minister had to say about legislation in the next Session. It is clear that the powers he has under the existing Act should be extended, and I am glad that the extension will be until 1963, although we hope that the payments will not go on as long as that. I am also glad to hear about the payments of grants towards converting and modernising these old ships. The only thing that puzzles me is why conversion has not been helped in this way before. I should like to say one further thing, in conclusion —I think it is something with which the noble Earl would agree. and something that might well reach the ears of the owners and men of the fishing industry. We all wish them well, and we appreciate their great services in war and peace. But we all hope. equally, that they will regard this public money they are now very justifiably getting as no more than an instrument with which to provide this island, the whole island, north to south, with an up-to-date, self-sufficient, fishing fleet that will hold its own in fair competition with any fishing fleet in the world. With those words, I welcome these three Schemes and I shall not detain your Lordships any longer.

EARL ST. ALDWYN
My Lords, I have explained why, without full information about the financial position of the inshore fishermen. it is difficult to get the facts which the noble Earl would like. But at least we know the value of the inshore landings, and we know that they have improved very considerably—in fact, they are up by over a third in England and Wales during the first five months of this year, as compared with last year. In the absence of exact information on costs. we have to use our judgment, and our judgment is that no change is needed. But I can assure the noble Earl that we will watch the position very carefully as he suggested.
As regards the coal-burning vessels, we are certainly in favour of replacing the less efficient steam vessels with up-to-date motor vessels as quickly as possible, and we should not wish to do anything which would in any way delay that. The difficulty is that the cost of operating the steam vessels has risen so sharply that there is a grave danger of their going out of use faster than they can be 104 replaced; and to fix a subsidy level that will keep the rate of decline in the numbers of steam vessels in reasonable relationship to the increase in motor vessels calls for a very nice judgment indeed. We cannot be sure that we have struck exactly the right balance, but I can assure the noble Earl that we have done our best, and I think we are right.