WHITE FISH SUBSIDY (UNITED KINGDOM) (AMENDMENT) SCHEME, 1961 (Hansard, 20 December 1961)

§ LORD HASTINGS
My Lords, I beg to move that this Scheme be now approved. It was only very recently that we were discussing a Scheme to provide a measure of relief for the middle-water fleet in their present difficulties. That Scheme, which is now in force, allows grant-aided middle-water vessels to make five voyages to distant waters, instead of only three, without incurring any penalty. The need for this arose because those middle-water vessels which had been fishing at the 754 Faroes had been having a very difficult time, and we wanted to give them the opportunity to help themselves by trying more distant waters.
Welcome though it is to the industry, that measure can provide only a limited amount of help, because the fact is that these vessels, which have been fishing mainly in the waters around the Faroes, have found for more than a year now that the catches there have been disastrously small. When the subsidies for the year beginning August 1, 1961, were discussed with the industry in the early summer, they asked for rates of subsidy considerably higher than those then being paid for vessels of the middle-water fleet, and supported their claim by evidence of the declining catches of the Faroes. At that time the Government had not sufficient evidence to justify paying such high rates of subsidy on this account. The subsidy rates introduced on August 1, therefore, took account of the performance of all middle-water vessels in 1960, and an increase in subsidy was granted which was based on their average performance and needs; and that increase amounted, on average, to £3 to £3 10s. 0d. a day.
When this subsidy Scheme was discussed in another place the Minister did say, however, referring to these Faroes vessels, that if the industry was right, and if a critical situation should arise over the next few months, he would have another look at the situation. The industry has now produced evidence of this critical situation. It has submitted accounts for vessels fishing at the Faroes in 1960 and 1961, and these show that in the first nine months of 1961 vessels spending the greater part of their time fishing at the Faroes lost, on average, £6,400. Vessels spending less time at the Faroes, and vessels not fishing at these grounds at all, were also making losses, but much less than this amount. I should like to remind your Lordships that these losses are not estimates, but the actual losses that have been incurred during nine months of this year. Unless there is a sudden and substantial improvement in catches in the Faroes, or these vessels are more fortunate in finding alternative grounds than they have been so far, the losses are likely to continue. There is an obvious need for urgent action to help the owners over 755 their present difficulties. For this reason, my right honourable friend has kept his promise to look at the situation again and is now introducing an amendment Scheme in the middle of a subsidy year.
The Scheme now before your Lordships provides for a subsidy of £13 a day to be paid to all motor vessels which in 1960 or 1961 spent 30 per cent. or more of their days at sea fishing at the Faroes—an increase, according to the length of the vessel, of from £3 10s. to £8 a day. The oil-burners built before 1950 will also receive the same increase.
As I have said, the losses have already been incurred, and had the information now available to the Minister been known earlier this year, these higher rates would have been awarded at the beginning of the subsidy year. Therefore, my right honourable friend has thought it right to apply the higher subsidy rates to voyages made by these vessels since the beginning of the subsidy year—namely, August 1—as well as to future voyages. He has also thought it right to pay the subsidy for all voyages by these vessels, and not only for voyages to the Faroes. If subsidies were to be paid only on voyages to the Faroes, those who have been fishing elsewhere would be penalised and the owners might be encouraged to continue fishing at the Faroes when all the evidence is for the need for less fishing there.
There is one other point to which I should draw your Lordships' attention. As the remuneration of crews is settled by reference to the gross proceeds, subsidy Schemes since 1956 have laid down a maximum amount of subsidy that can be counted in the gross proceeds for this purpose. In the past, the main reason for awarding increases in subsidy has been increases in costs. Therefore, since 1956 subsidy increases have been excluded from the crew settlement. On this occasion, as the additional subsidy is to be paid in order to compensate for a decline in proceeds, and this decline has already affected and will continue to affect, crews, as well as owners, it has been agreed that the whole of the subsidy increase should be added to the gross proceeds for the purpose of calculating the crews' share. I hope, there 756 fore, that your Lordships will give approval to this scheme. I beg to move.

§ LORD WISE
My Lords, there are just one or two small points that I wish to raise from this side of the House in regard to this Scheme. I think that generally we can approve the Scheme as being very necessary at the present time, in order to safeguard the interests of the fishing fleet concerned. From what the noble Lord has said, it is obvious that fishing around the Faroes has become more difficult and the profits of the owners have not only decreased considerably, but have now become a series of heavy losses. It is necessary that we should see not only that boats put out to sea at a reasonable remuneration to the owners but also that the crews are paid reasonable living wages according to results.
This Scheme enlarges upon a previous Scheme, and the higher subsidy involves additional expenditure by the taxpayer. I should like to ask the Minister one or two questions in regard to this. He gave no gross figures of the subsidy. What is the increase above the original subsidy? And can the noble Lord inform us of how many boat owners or boats will benefit by this Scheme? The losses have undoubtedly been very high, and perhaps he may be able to tell us what proportion of the losses incurred will be reimbursed by the subsidy which is now to be paid.
The noble Lord told us about the new procedure in regard to gross proceeds and the remuneration of crews. Can he tell us the amount that will be paid over to the crews: what proportion the owners will receive and, what proportion the crews will receive? We look upon this Scheme as being in the nature of a palliative for the time being, and it may be necessary for the Scheme to be continued in future years, possibly amended in some way, in order that the interests of the fishermen may be safeguarded.

§ LORD HASTINGS
My Lords, I am grateful to the noble Lord, Lord Wise, for his general recommendation and 757 approval of this Scheme. His questions are very much to the point, and I am only too pleased to answer them. Indeed, I apologise for not introducing in my opening speech the figures for which he asked. He asked what the extra subsidy will amount to under this amendment Scheme. Perhaps I should have pointed out that in connection with the Scheme an Order was introduced in another place to allow the Minister to receive from the Treasury the extra grant necessary. It has not come to your Lordships' House, because it is a Finance Order. There is to be a permissive increase up to £250,000 over and above the £25 million already authorised and advanced under the subsidy Schemes.
The noble Lord's next point was the number of boats which will benefit. It will be somewhere between 90 and 100 middle-water vessels, out of a total of just over 300; that is, about one-third. The proportion of losses incurred now to be reimbursed, I am afraid, is a more difficult question. As I said, the average loss in the nine months of this year was £6,400. I think it is correct to say that this extra subsidy will cover between £3,000 and £4,000 of that sum. The extra subsidy will not guarantee the owners altogether against loss but will be an assistance to them to help them over a difficult period.
The amount of subsidy to be paid to crews is regulated by the Scheme already in force. It may interest your Lordships to know how the Scheme is worked. On every voyage certain sums are deducted from the gross proceeds of the haul of fish they take. These sums, which do not include the ordinary overheads, but the actual costs of the voyage—fuel and food and (this is important) the basic wages of the crew. Those sums are taken off the gross proceeds, and then a bonus is paid out on the balance, in accordance with the agreement already in force, of so many pence per pound. That practice will continue, except that gross proceeds will have up to £13 a day added on top as a result of the subsidy, and the same proportions of the balance will be paid as are being paid now. I hope that this explains everything the noble Lord wished to know, and that the Scheme may be now approved.