§ 3.48 p.m.
§ Debate resumed.
§ LORD CHAMPION
My Lords, it looks as though that interruption is over and I can now resume my speech. I would only say to noble Lords who may look at the clock and think I have been speaking a long time that, as on the football field, time should be taken off 350 for interruptions, injuries and other things. I was talking about the improvement in efficiency in the farming industry. This improvement in efficiency has been going on now ever since 1947 and enabled the President of the National Farmers' Union, in his annual address to his Union, to make a sweeping and very proud claim:Last February the calculation of the net income of the industry was forecast as £359 million for the year 1960–61; on the basis of normal weather conditions it was estimated that the figure would have been £373 million. When this is related to output we see that net output compared with the immediate post-war years had increased by about 40 per cent. and real income had increased by only 5 per cent. The corresponding figures for the nation as a whole were rather less than a 40 per cent. increase in production and about a 45 per cent. increase in real income.That was a statement made on behalf of the industry, which I think was well justified. But, having said all that, I think that we have to admit that there is still very much to be done. That is why I particularly welcome Clauses 1 and 3 of this Bill, and I express the hope that there is nothing in the statement that I read in the Evening News last night and in the Guardian of this morning that improvement grants are likely to be savagely cut by the Government in the Price Review in the future. If the Minister, when he comes to reply, can give us that assurance, at least it will have dispelled some of the doubts created in people's minds as a result of these statements, which may be—who knows?—leaks to the Press.
Under Clause 1 of the Bill, the Minister told us, provision is made for increasing the amount to be spent on schemes under the 1946–56 Hill Farming and Livestock Rearing Acts from £27 million to £30 million, but the closing date for admission of these schemes is to remain at November of this year, so only some few months remain during which those hill farmers who have not yet taken advantage of these schemes will have to make their claims. I am not at all happy about this closing date. The Minister told the Committee in another place thatOver the country as a whole two-thirds of the total number of farmers who could take advantage of these schemes have done so at some point over a period of years.But the one-third who have not done so make up a considerable number of 351 farmers and farms and no one would assert, I think, that most of those farms where application has not yet been submitted are incapable of improvement. The majority of these hill farmers have a very limited income and while some of them would not take the trouble to do anything about these schemes, we have to realise that the major limiting factor is the shortage of the necessary capital.
LORD ST. OSWALD
My Lords, I do not think that the noble Lord is in the least mistaken about this. His date of November is quite correct, but of course this is the date by which applications for schemes have to be in, not the date for their consideration, and I did point out in my speech that none of these farmers had less than twelve years to consider the possibility and some of them had had seventeen.
§ LORD CHAMPION
My Lords, perhaps I used the wrong word when I said "admission"; "application" is the word I should have used in this connection. I am certainly not in any doubt about it myself. Those farmers who have not yet applied have up to November during which to make applications. Thereafter, it would be for the Minister's officers to consider the schemes and, if they considered them worth while, to grant the necessary money for them.
I was saying that the one-third who have not yet applied are mostly farmers on a very limited income and that in most cases capital has been the factor that has held them back. They would have to borrow, and for a number of years past the Government's imposed policy has resulted in high interest rates, which placed the borrowing of the necessary capital outside the bounds of possibility for many of these small farmers. In support of my appeal to the Minister to extend the date, I see that interest rates have fallen recently and I believe that this might be a factor which would cause many of these farmers who make up the one-third and who have not yet applied to give further consideration to this matter.
There is just one question I should like to ask the Minister in this connection. I hope he will answer it when he comes to reply. If not, I daresay he will send 352 me a note. What would be the position, after November, 1963, if some of these hill farmers were to apply for grants under the scheme under Clause 3? Would their claims be admissible, although at the 33⅓ per cent. rate, as against the 50 per cent. of the hill farming schemes?
§ LORD CHAMPION
It is a completely different scheme, but it all has something to do with improvement. It might well be that some farmers wish to apply, even if they "miss the bus" so far as the hill scheme is concerned. I must say to the noble Lord that I shall return to this matter on Committee stage.
Clause 2, as the noble Lord told us, is a straightforward extension of the period during which subsidy paid on hill sheep and cattle might be paid. It is a subsidy well worth while and designed to encourage livestock husbandry. The Minister has claimed, with some justification, that the scheme under Clause 3 has been a highly successful scheme. There is little that I wish to say about it, except to welcome the additional money which is to be put into it. Already one can see in the countryside evidence of the effect of this scheme, and if we grant an additional £35 million, as I imagine Parliament will do, the total amount spent in the end will be some £270 million on improvement schemes—that is, of course, when we take into account the fact that the farmer has had to make his contribution. This will go a long way towards improving the fixed equipment side of our farms.
I must admit, though I suppose not all my noble friends would necessarily agree, that I have a marked preference for this sort of subsidy over many of the present support subsidies, which, as we know, in many cases add to incomes of people whose incomes are already sufficient. But here the nation can see something of value for its money. One has only to run through the countryside to-day and compare it with what it was many years ago to realise that something has been done which is really worth while. However, in this matter of improvement grants we must be continually asking ourselves whether we have struck the right balance. Mr. Gavin McCrone, of the Department of Social and Economic Research of 353 Glasgow University, in a letter to The Times yesterday, gives these figures:of about £330 million spent on subsidies each year, approximately £250 million is spent on price support, £70 million on subsidies to cost, and only about £27 million on improvements.I would say that clearly some part of the price and cost subsidies is ploughed back into farm improvements, but I think there ought to be a continuous review of the balance between price support, cost subsidies and improvement schemes.
Clause 4 is a rather different matter. Horticulture has always been a part of our agricultural industry most difficult to assist except by tariffs and quotas. But it has always seemed to me that much of the fertiliser subsidy has resulted in the prices of fertilisers going up and swallowing the nation's contributions. No doubt the investigation by the Monopolies Commission into the affairs of the fertiliser industry had some effect, but clearly the Government Departments concerned should keep a close watch on this matter to see whether the granting of a subsidy results automatically in the price of fertilisers going up and the nation's contribution finding its way straight into the pockets of the manufacturers.
I would only say this in connection with Clause 5: I hope that it will close some more of the loopholes discovered by the lime frauds, which certainly shook the public faith in the general administration of this type of subsidy and brought the Ministry's administration into some disrepute. These lime subsidy frauds were something which undoubtedly shocked the nation; and it was surprising to find how many people with no interest at all in agriculture mentioned this fact to me because they knew I had had some little connection for a short time with the Ministry when I was in the other place. I would ask the Minister to look carefully at the administration of all these schemes to ensure that the possibility of fraud is eliminated, or is as nearly eliminated as is possible, because there is always some "smart Aleck" who is looking for a loophole in this, as in taxation and other matters.
Of Clause 6 I would say that here is a really worth while extension of the improvement grants for the co-operative 354 use of plant and machinery. These syndicates ought to be encouraged in every possible way. The very act of farming makes for a highly individualistic approach; and perhaps that is the reason why collective farms, in Russia and elsewhere, have not been an unqualified success. It seems to me that our farmers have been for too long afraid of the co-operative ownership of machinery and the like, and have lagged behind many other countries, notably Denmark. There has always been the fear that "The other man will want the machine on the very day that I want it myself", and that has often resulted in expenditure on machinery quite unjustified by the income of the farm—and, I would add, on farming machinery of which farmers are notoriously careless. One has only to look over the hedges to see the tendency they have to leave the implements rusting from the time they are used one autumn until they are required the next, to see how great is this neglect, and, indeed, how serious it must be on their general expenditure on their farms.
In this connection I was particularly struck by the remarks of Mr. Emrys Jones of the National Agricultural Advisory Service when speaking of small farmers in the milk production industry. He said:Sucess in the future may well depend more and more on the sort of group activities that are developing in some areas, which have certainly given the term 'co-operation' a new meaning. An outstanding example of this … was the case of three neighbours in Radnorshire, each with between 70 and 80 acres, who in 1959 formed a machinery syndicate for silage making, sharing the machinery and the labour. Their working in common has paid them well. Between them in 1961 they had a 25 per cent. increase in gross output and a 45 per cent. increase in net income.He makes a huge claim here, and I think perhaps a justifiable one. I certainly like this clause and the purpose behind it.
Nothing much need be said by me on Clauses 8 and 9, which, so far as I can see, are for administration changes and resulting in not much more than that, except that perhaps I should add that the more we can do in this field of co-operation and efficient marketing, the better. In any case, I think we can expect a searching intervention by my noble friend Lady Burton of Coventry, who I imagine will be devoting her lively mind to this aspect of the problem this after- 355 noon. Clause 10, 11 and 12 are, as the noble Lord said, enabling clauses, and I think we shall be better able to judge of their value when we see the schemes which will be presented to the House, if I remember rightly, under the Affirmative Resolution procedure. The Minister in the other place gave some indication of what is in his mind, and so did the noble Lord, Lord St. Oswald, this afternoon. We welcome this idea, but we shall have to examine the schemes carefully. Clause 13 extends, as the noble Lord said, the possibilities of seizure of certain materials, including now fertilisers, added in the other place.
I regard Clause 14 as an important clause, for however much we may boast about our British love of animals there is still a lot of cruelty involved in their handling in markets and elsewhere. The Minister mentioned bobby calves, which has been a subject of much newspaper comment recently. But gradually we have extended the protection for animals, and this protection is being widened by this clause of the Bill. I had the privilege of sitting on the Committee mentioned by the noble Lord—that is, the Balfour of Burleigh Committee on the export of old cattle to the Continent—which led to a big improvement in the conditions surrounding the export of those animals. While investigating the conditions abroad, I met a Dutchman who seemed to me to be just about as humane a man as one could possibly meet. He knew our conditions in this country, and in discussion on the cruelty involved in that export trade he gave me what I might describe as a very old-fashioned look and said: "Are you sure that the conditions in your animal transport, markets and abattoirs are all that could be desired in this respect?" He was too polite to add, as well he might: "You ought to be sure that your own methods are above reproach before you come investigating ours." As I say, he was too polite to say that; but he knew the conditions here, and I think he secretly resented the fact that we had gone to look at the handling of cattle there when our own handling of cattle here was not above reproach. He thought we were adopting a rather "holier than thou" attitude in this matter.
The subsidy to be given for vaccine under Clause 15 is a good subsidy. The 356 slaughter and compensation policy comes to an end this month, I gather. The only thing I would say in this connection is that I think it quite disgraceful that only one-quarter of our national flock has been vaccinated up to now.
§ LORD CHAMPION
I would support the Minister in everything he said in this respect. This really is disgraceful. I suppose I am old-fashioned enough to feel that "The Lord helps those who helps themselves". We are helping poultry farmers in this connection, and they ought to help themselves by getting on with this job of vaccination.
I now come to something concerning which I cannot imagine I shall get any friendly nods from the other side. We take strong exception to the clause dissolving the Agricultural Land Commission and the Welsh Agricultural Land Sub-Commission, both of which bodies, we say, have done a remarkably fine job of work under the overall supervision of an old colleague of mine, Sir Frederick Burrows. I think we shall all wish to join with the noble Lord, Lord St. Oswald, in his tribute to Sir Frederick Burrows on his stewardship in the office of Chairman of the Commission. Clearly, the dissolution of these bodies has been made inevitable by the disposal of nationally-owned land which has been followed by Conservative Governments since 1951. We are of the opinion that the Tory approach to this problem has been doctrinaire and not in the national interest. I will not develop my arguments further here, as we shall have to debate this clause fully on the Committee stage. I can well imagine that my noble friend Lord Williams of Barnburgh will have some typically trenchant comments to make, for he, I feel sure, is bound to see in this a continuation of the policy of attack on an essential part of the 1947 Act. It was started by the removal of the powers of the county executive committees. It has been continued throughout by the sale of land and, finally, by the dissolution of this Commission and the Welsh Sub-Commission.
I pass over Clauses 19 and 20 because of the fear of over-burdening an already over long speech, and I pass over Clause 21 for the simple reason that I know nothing whatsoever about it. It is true 357 that that is not always a disqualification for a politician, but I will certainly not venture into the field covered by Clause 21. The extension of the powers projected in Clause 22 of an authority compulsorily acquiring land to pay allowances towards removal expenses and for disturbance we wholly welcome. I think the House generally will welcome this, judging by the tenor of our debate last Thursday on the compensation of the farmers to be turned out owing to the construction of the Clywedog Reservoir.
I jump now to my last point, namely on Clause 25. Perhaps, in order to prevent any misunderstanding of my position in relation to this clause, I ought to declare an interest in sugar production and its sale in this country. I am one of the three Government-appointed Directors on the Board of the Sugar Corporation, and before speaking to-day I made some inquiries as to whether I should be debarred from speaking on this sugar clause because of the Addison Rules. I was assured that I should not be offending, but I must make it clear that I am in no way putting forward any views that might be held by that Corporation. They are mine, and mine alone. In any case, any interest that the Corporation might have is indeed a very marginal one.
As I understand the position it is this, stated baldly. The Sugar Act, 1956, was designed to ensure that there would be a market in this country for the sale of sugar from our home beet production and for the sale of a negotiated quantity, bought at an agreed price, of Commonwealth produced sugar. In 1961, as a result of considerable surpluses of beet sugar on the Continent, and of the Cuban crisis and the purchase by Russia of Cuban sugar which had previously gone to the United States of America, there was a considerable dumping of foreign sugar on to our market.
In the beginning of 1962 the Government changed the pricing arrangements so as to give a price preference to Commonwealth sugar producers over the foreign dumpers of sugar. That pricing arrangement worked to the disadvantage of the Republic of Ireland, which up to that point was entitled to a Commonwealth preference, which was ended by the 1962 arrangement. It is, too, as I understand it, the case that Eire gives 358 as well as receives a Commonwealth preference on all trade with the United Kingdom. Naturally, the 1962 pricing arrangement was viewed as another injustice to Ireland—an injustice which I regard as well worth while removing, as the Government are doing by Clause 25. In addition to removing an injustice by the agreement the Government, as the noble Lord, Lord St. Oswald, said, have secured some worthwhile advantages, notably by the Eire agreement, to buy from Commonwealth sources any raw sugar they may need for their home trade. So far as I am concerned, I wholeheartedly support this agreement and the Government's action in entering into it.
Even allowing for the interruption, I have taken rather a long time, but I thought some of the points worth while exploring a little. We shall have to return to some of them on the Committee stage. I would say that, with one or two exceptions, this is a good Bill, and we will assist in its passage through this House.
§ 4.16 p.m.
§ LORD MERRIVALE
My Lords, I should not wish to follow the noble Lord who has just spoken in his very detailed scrutiny of the various clauses of the Bill, for I imagine that my noble friend Lord Amherst of Hackney, with his great knowledge of the agricultural industry, will be doing that. I would limit my remarks to the provisions regarding the Sugar Board. In view of the fact that the noble Lord who has just spoken is a Director of the British Sugar Corporation, I was rather pleased to hear him say that he thought the provisions were out of place in this Bill.
As I said, I trust your Lordships will forgive me if I consider only Clause 25 of the Bill and its implications. I feel fortified in doing so by the knowledge that Parliament, since the passing of the Ponsonby Rule in 1924, has the opportunity of considering an agreement before ratification. As has been said, Clause 25 empowers the Minister to ratify the draft agreement which was deposited yesterday in the Printed Paper Office. This draft agreement significantly extends the powers of the Sugar Board as set up by the Sugar Act, 1956, to which the noble Lord, Lord Champion, referred. Without wishing to weary your Lordships with something the noble Lord said, for 359 the record I should like to quote from the foreword of the Sugar Board Accounts of 1961–62, which were printed on January 22, 1963. Paragraph 1 reads as follows:The Sugar Board were constituted on 15 October, 1956, under Sections 1 and 2 of the Sugar Act, 1956, with the primary functions of:—Therefore, by inserting this short and seemingly innocuous clause in a purely agricultural Bill, a new principle is envisaged by Her Majesty's Government. That is the power which would be granted to the Sugar Board, to enable them to trade in sugar with the Republic of Ireland on the direction of the Minister of Agriculture, Fisheries and Food.
- (a) carrying out the Government's contractual obligations to buy sugar at a negotiated price from producers under the Commonwealth Sugar Agreement of 1951; and
- (b) enabling the British Sugar Corporation, Limited, to implement the Government's guarantee to home sugar beet growers under the Agriculture Acts, 1947 and 1957."
As has been explained by my noble friend, the purpose of one of the Government's proposals is to rectify, so far as the Republic of Ireland is concerned, a situation brought about by an increase in the surcharge levied by the Sugar Board just over a year ago to discourage imports of foreign refined sugar. However, since then approximately £150,000 have been accruing to the Sugar Board from this surcharge on exports from the Irish Republic. I must say that, as an effort to balance the account, I find it a curious one in view of the current London daily price for raw sugar. At this point I think it is interesting to note the remarks that were made by Mr. Peter Runge, chairman of the West Indies Sugar Company Limited, in the company's annual report which came out last month, to the effect that an explanation for the high price sugar now fetched on the free market at £50 10s. per ton—more than double the price of a year ago when it fetched only £21 per ton, the lowest price since the war—was rising consumption brought about by an increased standard of living in certain parts of the world; and the noble Lord referred to Russia as one of the countries which was now buying more sugar.
In spite of the recent events in Cuba and a damaged Continental sugar-beet 360 harvest, it would seem reasonable to believe that the present market conditions will prevail for some time. Therefore, for the sake of argument, I would say that, should the years of surplus return, this agreement would, I feel, then have increasingly uneconomic aspects for this country. On the other hand, should the present position persist, then the agreement would not, I feel, achieve its object, which is for the Irish company to buy back its own refined sugar at over £10 per ton more than its selling price. Surely, in the long run, this would be uneconomic for the Irish Republic. The curious thing therefore, as I see it, is that these arrangements should be acceptable to the Minister of Agriculture in the Irish Republic. Also, it is interesting to note the comments which appeared in the Irish Times on February 19 to the effect that Ireland considered this a most satisfactory deal.
Regarding the suggested new outlet for Commonwealth sugar in the Irish Republic, which is put in the draft agreement at a minimum figure of 5,000 tons per annum, I think it is interesting to note that at the moment, before the draft agreement has been ratified, imports into Southern Ireland from Commonwealth countries are running at a figure of 15,000 tons per year. So it seems a little difficult to see what gain can be expected from that provision. Moreover, it is expected that imports into Southern Ireland from Commonwealth sources should, within the next few years, reach a figure of 25,000 to 27,000 tons. As the Commonwealth price to the Irish company is exactly the same as the price at which foreign suppliers supply their sugar to the Irish Republic—in other words, Southern Ireland will not buy her sugar any more cheaply from foreign countries than she is at present getting it from Commonwealth producers—it seems reasonable to believe that she will continue her present arrangements.
LORD ST. OSWALD
My Lords, may I point out to my noble friend that, whatever his figures may mean, the fact is that in the past Ireland has not bought from the Commonwealth. She has bought from foreign suppliers; and now she has undertaken to buy from the Commonwealth, which we consider a good thing.
§ LORD MERRIVALE
The Minister in another place said that at the moment Southern Ireland is buying from the Commonwealth 15,000 tons of sugar; that is, before any implementation of the agreement which will be allowed for by Clause 25.
My noble friend went on to say that the agreement would limit to 10,500 tons per annum the amount of refined sugar that would be imported into Northern Ireland. That is an exceedingly small reduction, considering that the trade at the moment is running in the region of 13,000 tons. I would say that the 10,500 tons which will be exported to Northern Ireland will be exported in competition with supplies from refiners in this country. I would stress that no limit whatsoever is placed on imports into this country from Southern Ireland of sugar in composite goods.
To end, I feel that when considering legislation we should not forget that the Irish Sugar Company is a refiner, and therefore operating in direct competition with our own refiners in this country, whereas Commonwealth exporters are not. Secondly, by passing this clause we are, as I have said, considerably increasing the scope of the powers of the Sugar Board, which I should have thought, if one proposed to do that, ought to be considered within the general context of the 1956 Sugar Act, and not within the ambit of a purely Agriculture Bill. Because, if this clause passes as it stands at the moment, the Sugar Board will be empowered to trade in the finished products of another country, which seems to be quite an increase in its powers. Finally, I must say that one of the main objects of this draft agreement, the avowed intention of refunding, in effect, £150,000—whether it is desirable or not—will not, I think, in all probability be achieved.
§ 4.30 p.m.
§ LORD MILVERTON
My Lords, like that of the noble Lord, Lord Merrivale, my intervention in this debate will be concerned solely with Clause 25, and my object is to show that there is a very bad principle embodied in this clause and that British sugar refiners have just reason for resenting the provisions of the Anglo-Irish Sugar Agreement. They are justified, I think, in their opposition to Her Majesty's 362 Government's intention to implement this sugar agreement with the Government of the Irish Republic and any such future agreements under this clause. I agree with other speakers who have gone before me in saying that this is curious company in which to find this clause; it seems to me very much out of place in this particular Bill. However, let that pass.
Before going on, I should, I feel, observe a custom of this House and declare an interest, because I am a member of the board of the West Indies Sugar Company, whose chairman was quoted just now by Lord Merrivale. I suppose that, like others of your Lordships, I have been inundated with literature from those who dislike this clause, and I have tried to get the facts, which are rather complicated, clear in my mind. With your Lordships' permission, I would state one or two of the facts, because without regard to those facts one can scarcely express a judgment on what this particular clause is trying to do.
First of all, the British Sugar Board was, as your Lordships doubtless know, set up by the Government under the Sugar Act, 1956, and British sugar refiners agreed to co-operate with it in the interests of Commonwealth sugar-growing countries. The Board buys raw sugar from growers in Commonwealth countries and sells it to the British refiners, who also buy part of their raw material on the free world market. The Sugar Board guarantees the Commonwealth grower a negotiated price for a large part of his production, and where this price is greater than that prevailing on the free world market the difference is covered by a levy which the Sugar Board is empowered to raise from the British consumer.
As one sees from that, the Sugar Board was intended to implement the Commonwealth Sugar Agreement, which was solely concerned with Commonwealth raw sugar. The effect of Clause 25 of the new Bill would be to extend these powers into an entirely new sphere as a State body trading in the refined sugar of a country over which the British Minister of Food has no authority and which is not technically in the Commonwealth. Not only is this a departure from the purpose for which the Sugar Board was set up and contrary to assurances which were given to the British sugar 363 industry in 1955 before the passing of the Sugar Act; it also introduces a principle which could be extended to trading in other commodities and which might have very far-reaching consequences.
The provision that Irish exports of refined sugar and sugar goods to the United Kingdom should be made from Commonwealth raw sugar is presented as an extra outlet for Commonwealth sugar. But British refiners, may I point out, if given similar favoured treatment to that which is being given to the Irish Sugar Company, and if allowed to use supplies of Commonwealth raw sugar for re-export, could have provided a much larger outlet for the Commonwealth growers' crop, and incidentally no subsidy would be asked for in order to get them to do so.
There are certain other facts which it is necessary to appreciate. The Irish Sugar Company has been said to have an established trade in Northern Ireland. That is quite untrue. The Irish Sugar Company sold no sugar in Northern Ireland before 1957. In 1958 the Irish Republic were not members of the International Sugar Agreement, and as a non-participant they were limited to sales in the United Kingdom of 2,900 tons. The Republic became an importing member of the International Sugar Agreement in 1959 and since then sugar entering Northern Ireland from Eire has been, in 1959, 8,200 tons, in 1960, 10,400 tons and in 1961, 11,700 tons. That record, based as it was on this particular privilege which they enjoyed, cannot be quoted as an "established trade". It was a trade which depended, and depends, upon getting this subsidy from the arrangement with Britain. It is quite true, it may be pointed out, that imports from the Irish Sugar Company into Northern Ireland have continued in 1962, and that is because of commitments by the Trish Sugar Company to buy French and Polish sugar. No one can say for certain whether without a subsidy this trade could go on in 1963, but I can say that it is the British refiners' firm conviction that the Irish company would find it extremely difficult to carry on without this subsidy, which comes ultimately from the British taxpayer.
I am trying to establish what exactly this subsidy is based upon. Ever since 364 Empire preference, British refiners have undertaken to hand to Commonwealth producers the full proceeds of the duty preference on Commonwealth sugar. This undertaking was renewed in 1955 to the then Minister of Food. Now we come to the hole in the tariff which the Irish company discovered they could make use of. When the Irish Sugar Company started to export sugar from the Irish Republic to Northern Ireland and Great Britain it obtained its supplies by importing sugar from such countries as Poland. When this sugar, Dr other sugar in substitution, was exported into the United Kingdom it attracted the rate of duty applicable to Commonwealth sugar, and as there was no counterpart to the British refiners' preference undertaking to give that preference amount back to the Commonwealth producers, the Irish Sugar Company had an advantage over British refiners. The advantage amounted to £2 10s. 0d. a ton. This anomaly was fully exploited by the Irish Sugar Company and the manæuvre became known in British circles as "the hole in the tariff", and I believe it was known as "the three-card trick" in Ireland.
Now I come to the next step. During 1961, as has been mentioned by other speakers, owing to the break in relations between Cuba and the United States, large quantities of Cuban sugar were bought by Russia and other Iron Curtain countries. The sugar was not wanted for consumption in those countries; they had to develop an export trade in refined sugar to get rid of it. Much of it was attracted to the United Kingdom, which at that time did not have any licensing system for sugar imports. The flow into the country reached dimensions which threatened the implementation of the Commonwealth Sugar Agreement. So, on January 1, 1962, in order to check the flow, British refiners were released from their preference undertaking. The drop in income to producers was made good by the Sugar Board, which recouped itself by increasing the surcharge it levied on sugar. Prices were left unchanged, however, because refiners, having been relieved of their preference undertaking, were able to absorb the increase in surcharge. This arrangement was known as "the régime". It considerably enhanced the competitive power of British refiners; it also plugged the 365 hole through which the Irish Sugar Company had been gaining that advantage which I have mentioned.
But, my Lords, in the circumstances which prevailed before, the British taxpayer was providing for the Eireann refiner of sugar an export subsidy amounting to 2s. 6d. on every cwt. which was exported in 1959 to 1961 to Northern Ireland and to other parts of Great Britain, all of which went to enable him to undercut British refiners. The money was provided by the British taxpayer. This fantastic situation arose from the fact that Eire grows beet sugar, but because she has all the benefits of Commonwealth duty preference she found it profitable to import world sugars for her own use and to export part of her own beet sugar production to Great Britain and Northern Ireland. By so doing she got the advantage of the United Kingdom's lower preferential import duty scale which she would not obtain were she to consume her beet production herself instead of exporting it to the United Kingdom. As I have said, this gave her an unfair competitive advantage over British refiners, so long as the latter continued to honour their agreement to pay the full amount of Commonwealth preference on all sugar which other Commonwealth producers may have wished to export here.
So, when, on January 1, 1962, that advantage ceased, owing to the arrangement which I have mentioned, it was not that the Irish had a grievance: it was merely that they had lost what was an unfair advantage, which put them on level terms with the British refiner; and they had been using this advantage in order to displace from the Northern Irish market the British refiner whose market it previously had been. That is precisely what this subsidy is now going to restore. It is not redressing a grievance, but restoring an injustice to the British refiner.
The things I have mentioned are, I think, indisputable facts: they are not opinions. If, therefore, any grievance existed before, it was a British grievance and not an Irish grievance. Refiners chafed under the controls, before this arrangement, over Commonwealth sugar, for a matter of sixteen years. I believe; and when the Sugar Act brought controls to an end, they were given assur- 366 ances that the Sugar Board would be used only to implement the Commonwealth Sugar Agreement, and, of course, the promises which had been made to the British beet industry. The legislation before the House now nullifies these assurances and makes the Sugar Board the instrument of a new Government policy. I do not know what the next step is going to be; but I suggest that this is a most inappropriate authorisation of a new step to be concealed in this clause of an omnibus Bill of this kind.
The difference in point of view over this is explained by the different relationship which exists between British refiners and members of the Commonwealth Sugar Agreement, on the one hand, and with the Irish Sugar Company, on the other. Members of the Commonwealth Sugar Agreement are primarily exporters of sugar, and are not in competition with British refiners, because any assistance they may be given is applied equally to all their products and not preferentially to refined sugar. Thus, they normally send raw sugar to British refiners because it is more profitable to them to do so. With regard to Ireland, however, any sugar exported by the Irish Sugar Company has to be refined from imported raw sugar, and they are, therefore, in direct competition with British refiners.
LORD ST. OSWALD
My Lords, my noble friend is not, I hope, overlooking the fact that under this agreement the Irish Republic is going to extend its own sugar beet area.
§ LORD MILVERTON
My Lords, I have not overlooked that fact, but I regard it as merely indicating how profitable this arrangement is going to be to the Irish. Any assistance given to the Irish Sugar Company is automatically applied by them to refined sugar, because they have no raw sugar to export. They do not grow enough sugar for their own needs. Any such assistance must, therefore, be unfair to British refiners—unless, of course, they receive similar assistance. In short, British refiners regard this agreement as one in which the Irish Sugar Company have offered to buy Commonwealth raw sugar, and then obtained a subsidy to enable them to sell it in competition with British refiners whose costs are lower.
367 To come to the last point which I wish to make, in order to justify the agreement it is represented that the Irish Sugar Company have an established trade in sugar in Northern Ireland, and that prior to January 1, 1962, certain advantages were enjoyed by the Irish Sugar Company for this trade which I mentioned just now which were unwittingly removed as a result of the administrative action by the Ministry of Food, and that these advantages should in equity be restored. It is represented that the damage done to British refiners by the payment of a subsidy can be justified if the Irish Sugar Company agrees to limit sales of sugar in Northern Ireland and to use Commonwealth sugar bought from the Sugar Board as its raw supply for this trade and for exports of sugar-containing goods to the United Kingdom. It is further represented that the payment of a subsidy is justified by the new outlet secured for Commonwealth sugar.
My Lords, if one examines this question one must reject these claims. The Irish Sugar Company has no established trade in Northern Ireland; it sold no sugar there before 1957, and when it joined the International Sugar Agreement it found itself in the position of being able to exploit an advantage of Commonwealth preference. Imports from the Irish Sugar Company into Northern Ireland have continued in 1962 because of the commitments in regard to its purchases of foreign sugar. But it is undoubtedly the firm conviction of British refiners that they would find it extremely difficult to carry on this trade without a subsidy unless they were able to finance their losses by increasing home prices. The limitation of sales into Northern Ireland only mitigates the damage to British refiners. It cannot justify the subsidy, because it is only the subsidy that will allow the Irish Sugar Company to compete with British refiners.
§ LORD KILBRACKEN
My Lords, will the noble Lord forgive my interrupting? He keeps on speaking about a subsidy which is payable to the Irish Government by the English Government. How does he know this subsidy is going to be payable? The Irish Sugar Company have to pay a price £10 above the average for the year, and if the average for the year is £40 no money is going to change 368 hands. If it rises above £40 the Irish consumer will be subsidising the British.
§ LORD MILVERTON
Well, my Lords, if it is argued that the limitation justifies the subsidy because the Irish Sugar Company is competitive without the subsidy, then it must be accepted that the 1960 and 1961 trade would have been achieved without the necessity of exploiting the "hole in the tariff". If that was so, the Irish Sugar Company suffered no damage by the removal of that advantage, and the whole argument for compensating the company for the loss of advantage derived from the "hole in the tariff" would fall to the ground.
The size of the new outlet for Commonwealth sugar has been greatly exaggerated. It could be created more cheaply in other ways. The new outlet claimed derives in part from the Irish Sugar Company's sugar exports to Northern Ireland, and in part from exports of sugar-containing goods to Great Britain. To the extent that it derives from the former it can be held to create a new outlet for Commonwealth sugar only if the sales into Northern Ireland can be done equally well without an agreement. This is denied, to take the other side of the question, so that the provision does no more than transfer the purchases of Commonwealth sugar from British refiners, who formerly had the trade, to Irish refiners, who have been slowly getting it. As I have said before, my Lords, if British refiners were allowed the same advantages they would be able to guarantee a much bigger field for the enlargement of Commonwealth sugar purchases.
My Lords, going back to the assurances, there was much detailed correspondence in 1954 and 1955 about the powers to be given to the Sugar Board under the Sugar Act. The sympathy with which Ministers viewed the feelings of sugar refiners in this respect was clearly indicated by the introduction of an Amendment to the Bill by the Minister himself to bring the Bill in line with the assurances given. The feelings of British refiners are unchanged, and they regard any extension of the powers of the Sugar Board as contrary to their interests and in breach of these assurances. The new Bill reawakens all the fears that were expressed during the 369 prolonged discussions about the Sugar Act when it was in draft, that the Sugar Board could be used as a convenient instrument by Government to further plans not attainable through normal commercial processes.
My Lords there is a good deal more which might be said, perhaps in Committee; there is no end to the points which can arise on this complicated question. In conclusion, may I say that I hope I have made clear the grave objections in principle to this clause of the Bill before the House. I sincerely hope that the House will give it further consideration in Committee when the time comes.
§ 4.58 p.m.
§ BARONESS BURTON OF COVENTRY
My Lords, I feel somewhat fortified by the two noble Lords who have preceded me in that they each confined themselves to one particular clause. I, too, should like to do that. What I have to say arises mostly upon Clauses 8 and 9—primarily Clause 9. For that reason, I hope noble Lords will not think me discourteous if I do not follow them into the detailed points they have made on their particular clauses.
Early in 1960 the Horticultural Marketing Council was set up, with a grant from the Government, to look into the system of marketing, and to advise, to experiment and to undertake research. As your Lordships know, it had none of the powers of a marketing board, but it seemed at that time to have a great many bright ideas which might usefully be introduced for the benefit of everybody alike. Four months after the setting up of the Council the Financial Times published an article on this subject, the first paragraph of which I should like to quote:The Horticultural Marketing Council, set up four months ago, is now in action. It has no time to lose. The Government is financing it for three years only, after which it will have to convince the industry, from growers to shopkeepers, that it is worth their money to keep it going. It has never been easy to collect subscriptions in horticulture; and three years is not long for the Council to sell itself.At that time, the Chairman of the Horticultural Marketing Council gave as one of his aims the achievement of better production, cheaper distribution and greater consumption. He hoped that this 370 would mean that the housewife would get the produce as cheaply, as fresh, and as well presented as possible. I personally thought that Mr. Bowerman coined a very good phrase when he said that the Council wanted to work "from plough to plate". The Minister may remember this. Obviously, the Government approved of these sentiments. because they footed the bill.
Last week, I was looking through some recently published reports of the Horticultural Marketing Council. As the House will know, these recent reports were three in number. They were Market Research Reports Nos. 8, 9 and 10, being technical and economic reports dealing with fruit, flowers and vegetables. I have two here; one concerns the housewife's attitude to vegetables, and the other concerns consumer habits and attitudes relating to fruit. I am not to-day going to be tempted into commenting on these findings; I think it would be out of place, and I do not wish to weary the House. But the point I do wish to make is that all these Reports carried the same foreword, and I should wish to bring two brief paragraphs of that foreword to the attention of the House. I would quote:The Horticultural Marketing Council was set up to promote the better marketing of and the development of the trade in fruit, vegetables and flowers. In pursuing these aims it is necessary to know just what the consumer thinks and feels about these products, the ways in which they are presented to her, and the places where she can buy them. With this knowledge, sensible and profitable plans can be drawn up for better marketing, better merchandising, and effective publicity. Without it, efforts in these directions may easily lead to disappointment and loss.The Council went on to say:It is a matter of the deepest regret to the Council that it will not be able to continue and develop the service to the industry of which these enquiries represent the first important instalment. Soon after the reports have been published, the Council will be dissolved. It is most earnestly to be hoped that the industry will see to it that the work is continued so that the industry keeps abreast of the times, and prospers as it can and should.My Lords, I want to ask the Minister to-night, for the benefit of those of us who do not know the "ins and outs" of this particular matter: what has happened here? Is it correct, could the Minister tell us, that on this particular matter the farmers by a small majority 371 voted in favour of continuing the Horticultural Marketing Council; the wholesalers voted 4 to 1 against; and the retailers voted 8 to 1 against? Arising out of the dissolving of the Council, I should like to ask the Minister why he felt that the Government could not continue with the financial support which they had given in the first place. Was it because they had agreed to do so for three years only; was it because the Government felt they had not had value for money from the Council; or, thirdly, was it because they considered that the industry itself should now provide finance for this work?
LORD ST. OSWALD
My Lords, I can, in fact, briefly answer the noble Lady now. I will try to answer in greater detail when I come to reply. I am afraid I have not the figures with me at the moment, and I will try to obtain them. But the fact is that the Council was wound up to the great disappointment of the Government, because sustained interest was not available from the industry itself. I cannot recall how the voting went on the occasion that the noble Lady names, but what I can tell her is that it was a great disappointment to us that it could not continue, because interest was not sufficient within the industry.
§ BARONESS BURTON OF COVENTRY
My Lords, I thank the noble Lord, because I thought he might say that, and I should like to go on from there. Separately from this question, I should like to ask the Minister if he can tell us when he comes to reply—and I think it is obvious from what he has just said—whether the Government feel that the work of the Horticultural Marketing Council should continue. If so, how is this to be done? The Minister said, in opening to-day—and I took down his exact words on Clause 9—"We must fashion new ideas". I would merely suggest here, for consideration—I accept entirely what he has said—that there is in this matter a responsibility on both the producers and those on the retailing and wholesaling side. But I would suggest to your Lordships that there is responsibility on the Government, too; and I expect, obviously, that the noble Lord will have had time to skim through, anyway, the debate in another place on Friday last.
372 I was interested to see that Mr. John Wells who moved the Motion there, and who is, of course, a member of the Government's side of the House, deplored the short and sad life of the Horticultural Marketing Council. Mr. Wells further went on to say that if horticultural co-operation were to make real progress there must be a further injection of Government money. In fact, I can give the noble Lord the reference, which is OFFICIAL REPORT, Commons, Vol. 672 (No. 68), col. 1602. If we move on from there, I must say that I was very fortified in my opinions by what was said on the Government's side of the House, because I hoped that might weaken the Minister's resistance to-night. Mr. Bullard, also speaking from the Government's side of the House in that debate on Friday, said that he, too, lamented the end of the Horticultural Marketing Council. He went on to say that he thought there was a job of research and development to be done in this particular matter.
One other point that I took up from there, and perhaps the noble Lord will tell me if I am correct when he comes to reply, was that with regard to this wholly unfortunate matter the National Farmers' Union had put forward six points, and one of them was a suggestion that there should be an Advisory Marketing Council on this particular matter. My Lords, in Clause 9 of the Bill that we are discussing to-day, we are told:The appropriate Minister may … with the approval of the Treasury make provision for the payment of grants towards the cost of carrying out proposals for promoting the efficient marketing of agricultural or horticultural produce, for carrying out research connected therewith".My Lords, I have been pursuing this matter for some thirteen years. I have not got very far yet, but I come from Yorkshire and I am very persistent and I intend to go on. I hesitate to quote from Hansard of twelve years ago. I always think it seems rather "much" to quote from what somebody has said a long time ago, but unfortunately nobody has given me any information or said anything to me which enabled me to change by mind. But as long ago as May 11, 1951—if the House would bear with me—I said that I thought there were three things necessary on this particular matter of distribution, which I 373 am dealing with now. I said [OFFICIAL REPORT, Commons, Vol. 487, col. 2364]:We require, firstly, a better marketing intelligence, a pruning of the expenses of marketing and a simpler system of distribution.I should have thought everybody would have gone along with me on that particular point. The second point was thatwe have, somehow, to bring the grower nearer to the retailer so that these highly perishable goods can be handled more speedily and waste avoided.I should have thought there was no disagreement there.
The third point—and I feel very strongly about this—was… I am convinced that the biggest item in the prices all of us pay for our home grown fruit and vegetables is not the cost of growing them but the cost of distribution",and I have never had any information to the contrary. My Lords, we look at the price paid by the shopper for any of these commodities, and we compare it with the price which is received by the producer. All I want to ask this House is what I have been asking for some weeks past: whether the size of that gap is really necessary. That is the point I want to establish.
To go back just once more to Friday's debate in another place, Mr. John Wells said, at column 1596, for the benefit of the Minister—and I quote:But, unfortunately, at the retailing end there is too much waste of money which is pushing up the price to the housewife".My Lords, when prices rise in the markets they rise in the shops, but when prices go down in the markets they do not always go down in the shops. That is not a matter of opinion but a statement of fact. I do not know whether the Minister has ever had made to him by a wholesaler a remark similar to the one that a wholesaler made to me. He said: "The housewife who wants to buy 2 lb. of cabbage will not buy more than that if we put down the price, so it is not worth putting it down".
Some time ago I visited Covent Garden—it was some years ago—to have a look at the system of distribution and to find out how prices compared. I do not propose to weary your Lordships with the systems of distribution then obtaining, but, at the risk of tedious repetition, and indeed basing myself on the noble Viscount the Leader of the House, who 374 told us on Wednesday last that it is the obvious which stands particularly in need of emphasis, I am going to say that what we want, first, is a simplification of the present arrangements so that produce goes through fewer hands; secondly, a pruning of the expenses of marketing; and, thirdly, a better marketing intelligence—all this simply to bring the grower nearer the point of retail sale. Nobody is going to tell me, or expect the British public to believe, that the system of distribution could not do with this.
Some years ago Warwickshire producers told me of the long and duplicated journeys their produce had to take to reach the customer. Moving up to July, 1960, I was told by a producer from Sevenoaks that his horticultural produce goes from Sevenoaks to Covent Garden and back to Sevenoaks to be sold. Coming right up to date, I am fortified again by a letter in the Daily Herald on September 3, 1962, which had at the top, "The costly travels of a cabbage". The letter, which was short, said this:Critics of vegetable prices should know that we shopkeepers do not control the price the customer has to pay for cabbages. Shops in any given area charge very similar prices. In the cut-throat world of modern shopkeeping we cannot put up our prices. The tremendous difference between what the grower gets and what the customer pays is due to the marketing system under which produce from Devon is taken to London to be sold and then driven all the way back to Devon again.That was from a Mr. Keenan, of Crediton, in Devon.
Now what has the Minister to say about all this?—and I hope it is going to be a little better than the answers I have had in the past, because I agree with Mr. Keenan. I think he is right: I think that this system of distribution is largely responsible for the size of the gap between producers' prices and shoppers' prices. As the House knows, I have been pursuing this problem for some time here, hoping to secure collaboration from the Government. On February 7, I put down a very harmless Question to the Government, asking them if they were prepared to provide information showing the difference between prices obtained by farmers and prices charged in shops for various commodities when such information would seem to be useful. In his reply, the Minister, of course, stressed the difficulties. I am sure he remembers that. 375 He told the House that information in the desired form was limited to milk, eggs, potatoes, and some fresh fruit and vegetables. Then, in his further reply on February 21 [OFFICIAL REPORT, Vol. 246 (No. 44) col. 1439] the Minister obviously forgot he had included "some fresh fruit and vegetables" in that very meagre list; and furthermore, on February 28 he implied to the House [OFFICIAL REPORT, Vol. 247 (No. 47) col. 190] that there is no single commodity in the fresh fruit and vegetable field for which price details such as I had requested could be given.
My Lords, that really is complete and absolute nonsense. I just do not believe it. I am not implying falsehood to the noble Lord—I am sure he is aware of that—but it just is not true. What really is at fault is that there is no will on the part of the Government to undertake this investigation. Now I do not know why we 'have this tenderness on the part of the Government, and a reluctance to provide us with this information. The noble Lord will remember that on February 21 my noble friend Lord Stonham, at column 1440, tried to come to his rescue, and told him that if he would look at the Fruit Traders' Journal which gives the market wholesale prices payable for the main fruit and vegetables, he would be able to give me the information that I wanted. The noble Lord did not agree with that, but he seemed to relent slightly the following week, when he said that he could get some of that information but that it really would not be valid.
My Lords, I have talked to a good many people about this matter—people not of my political opinions—who think that what my noble friend Lord Stonham said was accurate, and that the figures could be obtained from that source. I am quite sure that tonight I shall be told once more of the comlexity of this problem, of the great variation in produce, and of the difficulty in making valid comparisons. I would accept all that, but I should like to ask your Lordships: since when has the difficulty and the complexity of a question meant that it should not be tackled? It seems to me a very poor reason for leaving it just as it is.
So I am asking the noble Lord, under Clause 9 of this Bill, whether the 376 Government would not feel able to look at research into these two aspects: first, the aspect of distribution to aid efficient marketing of agricultural or horticultural produce; and secondly, the gap existing between what the producer receives and what the housewife pays—not, my Lords, I would point out, with the object of blaming anyone, but of finding out how big this gap is. I would leave with the noble Lord a remark made by the noble Lord, Lord Mancroft, on December 5 last [OFFICIAL REPORT, Vol. 245 (No. 18). col. 260]—and I quote:… where there is a political will the Treasury draftsmen will find a way.
§ 5.18 p.m.
THE DUKE OF ATHOLL
My Lords, I hope that the noble Lady opposite will forgive me if I, too, do not follow her into the realms of Clause 9. It is not something of which I have any great knowledge, and, like the noble Lord, Lord Champion, I feel that this is a good reason for not talking about it. On Clause 8, I should like to ask: why does this apply only to England and Wales? Is there already an equivalent provision for Scotland, or does my noble friend think there is a tartan curtain stretching from the Solway Firth to the Tweed, as I am sure even the noble and gallant Viscount would agree, tribes do not respect purely arbitrary lines on the ground? What happens if a co-operative or a syndicate of farmers (whatever you like to call them) wishes to set up on either side of the Tweed?
This Bill is a glorious hotchpotch of miscellaneous agricultural provisions, and it is therefore difficult to make any comments which have a relevance to more than one or two clauses. I should, however, like to make a few comments on some of the clauses, starting off with Clause 1, which is the one increasing the amount of money available for the hill farming scheme under the 1946 Act to £30 million, which I of course welcome only too heartily. I feel I must declare an interest in this scheme and, at the same time, I would say how co-operative we have always found the people who administer the scheme in Edinburgh. They have been immensely long-suffering with the number of variations, additions and alterations that have been made to the original outlined scheme and they have been sympathetic to the reasons which underlie them.
377 However, like the noble Lord, Lord Champion, I would ask why the date of November 5 of this year is being adhered to for the end of the scheme. In Scotland, until 1958 a tenant farmer could leave his farm to anyone at all in his will even if he had no lease and it was purely on tacit reallocation. This meant that many farms, far too small to be economic, continued to exist, and therefore, quite rightly, hill-farming schemes for these farms have been refused. These farms are now gradually coming back into hand and, on the whole, they are either amalgamated with other farms or will be re-let as bigger units when the chance comes. This means that the Department consider hill-farming schemes much more favourably. If the Government keep to the date of November 5 a lot of applications will be put in before that date in a form in which the people making these applications have no intention of pursuing under the scheme because they know the tenants of the farms concerned will be leaving within the next four or five years, and therefore, at the end of that time, the whole basis of the farm will be altered; it will be made much bigger and the farm will therefore be much more economic. This will waste a lot of time for both the Department of Agriculture and the people concerned in drawing up plans and submitting applications which it is not intended to carry out.
There is another reason why I hope this time limit will be extended. Some tenants have remarkably little incentive to farm well at the moment. They are reaching the end of their lives and they just like to stay in the house in which they have always lived. In four or five years' time they will give it up or else they will die and the farms will come in hand. Then, of course, one would like to make a completely new scheme with the tenant then concerned; he may want to farm differently from the present man. I feel it would be a great help in the case of tenanted farms, of which there are still a great number in Scotland, if this scheme could be extended for several years yet.
The next clause that I want to welcome is Clause 6. I think it is an excellent thing that farming syndicates should be able to get grants, and I cannot imagine why they could not have done so in the 378 past. I am sure it was just a mistake that they were left out of the original legislation. But does this clause go far enough? Clause 6 (1) says:The … Minister may make grants towards …(b) the housing of agricultural machinery belonging to the syndicates".I should have thought that in the near future many syndicates might find it useful to keep their livestock in one large building rather than in many small ones perhaps spread over several farms. I can easily imagine that in the future a dairy farm could be more efficiently run if, say, three dairy farms got together and the cows were milked in one building, and they would then be able to afford up-to-date milking machinery. Can my noble friend tell me whether that will be included under another scheme or whether Clause 6 could be widened so as to include things such as that?
The next clauses on which I should like to remark are Clauses 10 to 12. Of course, once again, I welcome them. They will do a lot of good, but we shall know much more about these when the draft schemes are published. I think it is a pity that this pale substitute for M.A.P. has been introduced and that M.A.P. is not being restored. It was a scheme well understood and of great value to all marginal farms. I should have thought the Government could admit that it was a mistake to withdraw this scheme and reintroduce it in its original form. Since there is a new spokesman on agriculture in this House since I last spoke about this, I would assure him that it was of great value and very well thought of, at least in Scotland.
I should now like to draw attention to Clause 16 (4). This removes the limits of registration fees for bulls and stallions. The previous limits, as I think all noble Lords will agree, were ridiculously low. But the Highland Pony Society are very worried by the complete removal of the limit because they feel that if there is no maximum written into this Bill, or if the fee charged should be too great, there will be a great incentive to many people in remote parts to keep unregistered stallions. This would not only be bad from the breed point of view but it could introduce hereditary diseases that we have gone to great lengths to wipe out in pony, horse and 379 cattle stock. I hope that, if my noble friend will not agree to putting an upper limit to these fees in the Bill, he will be able to give us an idea of what these fees are likely to be and some form of assurance that they will not be raised unduly in the very near future.
I do not think there is anything else in the Bill that calls for comment from me. So far as Clause 21 is concerned, I cannot understand this at all. I am the only Scottish speaker here to-day and this clause is an absolute mystery to me. I had great hopes that my noble friend would explain it, but I cannot say I was any wiser about it at the end of his speech. I would just say that I am very surprised to find Clause 25 in this Bill. It fills me with horror. When I tried to put down an Amendment to the Scottish Licensing Bill to reduce the power of the Secretary of State to refuse licences in State management areas, I was told by the Government spokesman that the Bill was not a "suitable vehicle". Well, if that was like putting passengers into a lorry, then, in my opinion, this clause is like putting a stretcher-case into a dust cart. It seems to me to be singularly inappropriate.
I am sorely tempted at the Third Reading of the Water Resources Bill to move an Amendment to compel the Central Electricity Generating Board to buy electricity from the South of Scotland Electricity Board at, say, 2d. a unit and to sell it back to them at about ½d above cost price. It seems to me that it would be equally relevant and of equal value, at any rate to Scotland. I should like to point out that, as a result of this agreement, the two places to suffer from the employment point of view are Greenock and Liverpool—both areas of high unemployment. I should be grateful if my noble friend could answer the points which I have raised. Apart from Clause 25, I do welcome this Bill and hope it rapidly becomes law.
§ 5.30 p.m.
§ LORD AMHERST OF HACKNEY
My Lords, like all previous speakers, I welcome this Bill. As the noble Lord, Lord Champion, has said, it is a very disjointed Bill. As I find myself in almost complete agreement with everything that the noble Lord, Lord Champion, has said, and he gave a fairly 380 detailed summary of his opinions on the Bill, I will not weary your Lordships with a long speech and will refer merely to one of two clauses.
The only point on which I would not agree with the noble Lord is on Clause 18. Like him, I would give unstinted praise to the work of the Commissions, but I think that it is a good thing that the Government have sold off sufficient land to make those Commissions unnecessary. I would support the noble Duke in hoping that the Government will think seriously about whether the Livestock Rearing Act and the Hill Farming Acts should not be continued, although I realise that at the moment there is only a small trickle of cases coming forward under these Acts.
Under Clause 3, which provides for the increase in the grant under the farm improvement scheme, on which I should like to congratulate the Government, I feel that, as a result of the stopping of the hill farming schemes, there may be a considerable additional pressure on the £35 million which has been added to that scheme. People who would have put forward schemes under the Hill Farming Acts will be forced to put them forward under the Agriculture Act, 1957, and that may lead to a great deal of extra pressure on the £35 million. It would also have disadvantages for those people who put forward schemes for the more remote parts of the country, which on the whole are more costly. At the moment, comprehensive schemes get 50 per cent. grant whereas, under the farm improvement scheme, their grant would be only 33½ per cent.
I think that this farm improvement scheme has done a tremendous amount of good and I endorse everything that the noble Lord, Lord Champion, has said about it. I think it works very satisfactorily in practice and presents comparatively few difficulties. The only thing that sometimes, in marginal cases, presents some difficulty is the "prudent landlord" definition. In the case of the smaller farm, there is probably not much difficulty in deciding that it is viable, but whether a notional prudent landlord would carry out a particular expensive improvement sometimes leads to certain differences in opinion. Another difficulty is whether certain new and improved methods, say of handling grain, or various types of bins and systems of 381 storage, should or should not be brought under the Act as passing the test of the prudent landlord. But, on the whole, the provision has worked well and anybody who travels about the countryside can see the results of it.
I would refer briefly to Clauses 6 and 7. Again, I should like to congratulate the Government on these grants for machinery syndicates. I feel that these syndicates have a tremendous future and small farmers would be well advised to take all advantage possible of these schemes. Again, in regard to Clause 15, which deals with the vaccination of poultry, it is surprising that more has not already been done. A number of poultry-keepers have been very remiss in not already taking advantage of this subsidised vaccine and every possible pressure should be put on them to make them use it. Otherwise, they become a menace to their neighbours. I know that a great deal is being done to publicise this, but everything more that can be done should be done.
I welcome Clause 19, which amends the Agricultural Holdings Act, 1948, and closes a loophole which one or two unscrupulous people were using to give notice to quit to tenants on the ground that they had not carried out repairs. This is agreed between the National Farmers' Union and the Country Landowners' Association, and I think that it will be an advantage. I also welcome Clause 22, which allows compensation to be paid to farmers who are displaced, in the same way as to owners of businesses, but I think it is perhaps a pity that this compensation is permissive and not mandatory. The clause says that councils "may" pay compensation and does not say that they "shall". I agree that this is the same as in the original Land Compensation Act, but if it is possible to make it compulsory it should be done. If it is not possible to make it compulsory, then I feel that if, for any reason, a local authority does not pay full compensation for disturbance, et cetera, or pays at a reduced rate, they should state publicly then reasons for so doing. I have mentioned just one or two small points on the Bill. Generally, I join with all other noble Lords who have spoken in giving it a welcome.
§ 5.40 p.m.
My Lords, I intervene in this debate because I feel that 382 little has been said on the general policies underlying the Bill, both on what the Bill does and on what it does not do. I welcome the Bill very much for what it does and also for a certain trend which I think I detect in it. I know that the Bill is rather for discussion in Committee than for general debate—indeed, that has 'been obvious from the way that all noble Lords have considered clauses, one by one, throughout the Bill, rather than its general principles. I think this indicates that it is not necessarily a Bill that is for new policies. Nevertheless, I feel that there is in the Bill a certain shift of emphasis. I rather agree with the noble Lord, Lord Champion, who said that he did not think there was any common principle running through the Bill. But I detect a shift of emphasis, which seems to be away from price support and cost subsidies towards measures designed to strengthen the industry and make it more efficient. I notice this trend not only in this Bill, but also in the pattern of where the weight of the present subsidies is falling. This seems to me to be a good thing.
I daresay that when this Bill was framed it was framed with an eye to the Common Market and our possible entry into it. I still hope most devoutly that we shall go into it, but I feel strongly that the problems confronting the agricultural industry are problems which will remain the same whether we are in the Common Market or not. These problems are the co-ordination of home-produced food and imported foodstuffs; what quantity we grow here and what quantity we import. That is really the crux of the whole matter. Does this Bill help in solving this problem? Are the grants large enough in themselves, or are they long enough in point of time? Are there other grants that we could effectively use towards securing that efficiency which must in the long run help the consumer just as much as it helps the producer? Is there any indication in the Bill that those subsidies which we feel are not effective will be diminished and, eventually, abandoned? It is true that deficiency payments remain as they are (there is nothing in the Bill about them), but deficiency payments must in the long run come to an end. It is a bad system, and, as the noble Baroness, Lady Burton of Coventry, said, they tend to go into the wrong pockets.
383 I welcome the fact that the Bill shows a definite tendency towards a policy of production grants and away from the subsidy system, but I do not think it goes far enough. I wonder whether this Bill could not perhaps pave the way towards some new comprehensive measure that would take the place of the Agriculture Act, 1947, and subsequent Acts. The 1947 Act was a great Act, and with it the resuscitation of the whole agricultural industry has come about. But I think the time has now come when we must re-think the whole issue and try to co-ordinate the whole policy in regard to home and imported foodstuffs, and overhaul the marketing system, in one great comprehensive measure. This Bill does not do that, and it is not intended to do so. But I think it is important to draw attention to the fact that, although this Bill does not go very far towards this, it does go some way and shows a tendency. I welcome the individual details, and the difficulties will be ironed out in Committe. But, as I say, I should like to see this as a Bill paving the way for something more comprehensive. I feel it is possible, judging by this trend that I detect in the Bill, that the Government are thinking this way too, and I should like them to go a little further than they have gone in this Bill, good as it is.
§ 5.45 p.m.
§ LORD WALSTON
My Lords, it has been interesting to me to see that a Bill which is an agricultural Bill, albeit a miscellaneous provisions Bill, has attracted nearly 50 per cent. of the speakers and nearly 50 per cent. of the time from people who would not claim to be speaking as agriculturists. I do not think that is a bad thing; speaking as a farmer, I think it is encouraging to find that consumers and processors, and possibly even distributors, should take an interest in the subject.
Perhaps I might deal first, quite briefly, with this vexed clause, Clause 25. I was particularly interested when the noble Lord, Lord Milverton, said that there was no end to the argument. I was beginning to wonder how long we should be sitting here listening to the arguments on all sides. But, at the end of it all, it seems to me that what the Government are doing is not subsidising the Eire Government, nor particularly the Eire farmer, 384 but simply having a gamble on the world price of sugar. Perhaps in this age of bingo, premium bonds and so on there is no reason why the Government of the country should not have a gamble with the Government of Eire. All I can say is that, if they do, I hope we win.
The other non-agricultural speech was the fascinating and informative speech of my noble friend Lady Burton of Coventry. She spoke with great knowledge, and I hope she has (shall I say?) smoked the noble Lord out of his reluctant corner, and that he will, as a result, give us rather more information than my noble friend and others have been able to extract from him over the past few weeks. The only other thing I would add on that point is that, as my noble friend pointed out, a large proportion of the total amount the housewife pays for food—I would say at least 50 per cent., as I think is shown by official statistics—goes to people other than the producers.
We have in the past spent—and quite rightly so—through the Agricultural Research Council, large sums of money in order to promote efficiency on the farming side, and I am delighted to see that under Clause 9 there is to be the possibility of spending at least some money for research on the distributive side, which is every bit as much in need of research and has every bit as much scope for improvement as the actual producers themselves. In view of the great difficulty which the noble Lord has had in providing small parts of the basic information for which my noble friend Lady Burton of Coventry and others have asked in the past, I hope that one of the first activities on which the money authorised under Clause 9 will be spent will be in acquiring basic facts and statistics as to the amount of "spread" there is in different food commodities between the field and the kitchen; how that money is spent; where it goes, and what the movements of the different commodities are. Because, until that basic information is assembled and made public, it will be difficult for us to obtain any significant increase in efficiency.
I now turn briefly to the other more agricultural aspects of the Bill. I was interested that the noble Lord, Lord St. Oswald, in talking about Clause 2, made mention of the fact that one of its functions was to improve the quality of the 385 cattle kept in the areas covered by the Hill Farming Act. Undoubtedly, that is an admirable thing to do. But, at the risk of bringing up one of my own particular hobby-horses, I would point out to the noble Lord that one of the best means of enabling farmers to improve their cattle, whether it be on the hill farms or elsewhere, is by giving them freedom, subject to the necessary quarantine restrictions and so on, to import even from foreign countries any breed of livestock which they think will help in this respect.
In order to do this we do not ask for any Government money; we do not ask for subsidies of any kind. We ask for a very small amount of freedom which is available to breeders of horses and dogs (subject to quarantine) and other less economically important forms of livestock. In this particular context, I would mention to the noble Lord my own limited experience with a herd of cattle similar to those kept on hill farms, the Long Pedigree Aberdeen Angus. The one experience I have had with the Charollais bull shows that the calf at birth is 50 per cent. heavier than the straightforward Angus calf, and its growth record for the first seven or eight weeks of its life shows that it can maintain that improvement. If the noble Lord and his colleagues are interested in improving the standard of cattle on hill farms, I suggest to him that at no expense to the taxpayer, at no risk to the health of the livestock of this country, but only possibly at the risk of displeasing some of the vested interests already existing, the breed societies, he should consider once more the question of extending to hill farmers and other farmers this freedom of importation.
Comments have been made on Clause 3. I think we all agree that that form of capital subsidy is an admirable one, although perhaps in some ways it did not work quite so well as some had hoped, in that its application has been confined rather to those farmers or landowners who have sufficient capital to put up their two-thirds contribution. There are a good many people with holdings which need re-equipment but where the initial capital is not available from the farmer or the landlord himself. That is a drawback to the scheme, though it is by no means a reason for disparaging the scheme itself. The noble 386 Lord, Lord Amherst of Hackney, made mention of the prudent landlord. He is always an elusive fellow, and it is rather hard to decide exactly what he should do. My own view is that at the moment, until we have a change of Government, or at least of Government policy, any prudent landlord would be chary about investing any money whatsoever in agriculture. But that situation, we hope, will not last for very long.
We now come to Clause 4, the extension of the fertiliser subsidy. Here perhaps I may make a rather more general comment on this type of subsidy. In my view, it is an admirable one if it is designed to encourage the adoption of new methods or new techniques which otherwise, because of their expense, the prudent or cautious farmer would be unwilling to adopt. In order to get something which is believed to be a good method adopted more readily, I think it is an admirable idea to make that commodity or technique cheap by way of a subsidy. But that must not be used as a permanent and continuing subsidy.
In the days when farmers were diffident about using fertilisers because the costs were too high and the profits insufficient, it was a sound idea to give a subsidy for the use of fertilisers, not only so that they might get it somewhat more cheaply but because, being human, we farmers always think it rather nice to get something for nothing, or at lower than cost price, to encourage us to make use of them. But, surely, the time has passed when any farmer, other than the most backward and reactionary, hesitates to use the appropriate amount of fertiliser. I am doubtful whether the continuation of a fertiliser subsidy can be justified, especially, as my noble friend Lord Champion pointed out, since it is highly probable that a large amount of that subsidy finds its way into the pockets of people other than the actual farmers. We must remember that every time the fertiliser subsidy has been reduced the price to the farmer has come down by at least as much as the reduction in the subsidy payment.
We must remember that the industry is protected to some extent by tariff, and we must not forget that last year, when there was a question of importing nitrogenous fertiliser from Poland at about £12 per ton, application was made by that weekly- 387 growing industry, I.C.I., for protection against this unfair competition—an application which was listened to and acted upon by the Government. But shortly after that I.C.I. themselves exported nitrogenous fertilisers to Eire for £12 a ton. I think that that fact should be remembered when we are discussing fertiliser subsidies.
The only point I have to raise with regard to Clause 6, other than giving my warm approval to it, and uttering wishes for its success, is to take some slight issue with my noble friend Lord Champion. He mentioned something rather derogatory about farmers leaving their machinery out in the rain instead of putting it under cover. I know that this sometimes happens but it is frequently far more economic to leave your plough or disc harrow out in the rain, and to put a coat of paint on it at the end or beginning of the season, rather than to erect, at considerable expense, even with the Government subsidy, a building in which to house that machine. On many occasions when town friends of mine have commented on this sort of thing I have pointed out to them the actual cost per annum of housing all the machinery on the farm, and they have agreed with me that possibly a coat of paint is a cheaper way of doing it.
On the same clause I should like to endorse the suggestions of the noble Duke, the Duke of Atholl, about including livestock in that type of co-operative housing. I am quite sure that the time will come before long when many livestock farmers will find it in their own interests to cooperate, perhaps not in the rearing of livestock, but certainly in the milking of dairy cows after they have reached maturity. There are examples which have been going for many years in the United States where farmers own their own cows, where they look after them when they are dry. When they have been served by artificial insemination, and when they have calved, they retain the calves and rear them, but the cows go to a central co-operative dairy where they are milked, the farmers being charged for the cost of milking and food, and credited with the amount of milk each cow produces, and then, having been served, she is returned to the farmer for her dry period and calving. That is the type of 388 situation which I should like to see developed in this country, and I should like to see the facilities of this good clause extended so as to embrace livestock as well as machinery.
Now let us come on to Clause 10, the winter keep grant. When it was first announced, this seemed to me an admirable idea. It is clearly a good thing to encourage farmers to grow their own keep for use during the winter months. As I said in connection with the fertiliser subsidy, any grants of this kind must be given in order to promote the more rapid adoption of new techniques, rather than to promote the continuation of techniques which, because of their economic implications, are already beginning to pass out of normal use. I had hoped, therefore, that this type of grant for winter keep would be something on the lines (and here I am speaking only dialectic-ally, and not literally) of grants for more modern haymaking machinery, possibly for barn drying of hay, and for silage machinery to enable silage to be made more cheaply. At the moment there are many farmers who still make hay in the expensive old-fashioned method, or who do not make silage at all because it is too expensive.
It appears from what the noble Lord said that this grant will be used to encourage farmers to grow crops which they have given up growing only because they have found them too expensive. They have suggested a grant of £2 an acre for growing turnips. I think that would have been an admirable grant to have introduced in the 18th century when Lord Townshend introduced turnips into this country in order to get them widely spread and widely used. Eventually, though rather slowly, their use did spread until in some part of the country they became almost universally used for feeding stock in the winter. They have now gone out of use solely because it is too expensive to grow them and there are cheaper ways of feeding cattle in winter. Surely it is a very retrogressive step to use money in order to bring back into common use a custom and system which modern mechanisation and modern economic trends have shown to be outworn. I hope the Ministry and the noble Lord will have second and third thoughts on this subject, and will make sure that this potentially useful weapon is used 389 to encourage good and modern methods of cultivation and not simply to revive old and outworn ones.
There are not very many more clauses on which I will detain your Lordships. I certainly endorse everything that has been said by the noble Lords, Lord St. Oswald, Lord Champion and others about the very great importance to farmers, and the poultry industry in particular, of the vaccination against fowl pest. But I think that, unless there is a very great improvement upon that figure of 10 per cent. of poultry owners which the noble Lord quoted, the whole industry will be in for extremely serious trouble. I think it is well to remember in that connection that it is not the deaths which cause economic losses; it is the setting back of the animals, the going off lay and the extra eight to ten weeks taken to bring fowls up to broiler weight that cause the trouble and economic losses.
I am very glad to see Clause 17, which lays increasing emphasis on the performance, records and progeny of bulls and boars, and I hope its effect will go far. I also welcome Clause 22, but I agree with the noble Lord, Lord Amherst of Hackney, in that I would much rather see it laid down that the acquiring authority shall or must pay, rather than may pay. I think it goes without saying, and I will not elaborate the point, that the abolition of the Land Commission under Clause 18 is something which we strongly deprecate and which we may in due course be able to persuade noble Lords on the other side to abandon.
In general, my Lords, this is a patchwork Bill, and I do not think it sets out to be anything else. In the context of the general lack of policy and general search for ad hoc remedies to put right obvious wrongs which have arisen because of this lack of policy and the moving away over the years from the principles of the 1947 Act, I do not think it is a bad Bill at all. I think it is almost as good as; one could have expected the noble Lord and his friends to produce, and with that modified welcome I am glad to support it. Before I finally sit down, may I say that I hope the noble Lord, Lord St. Oswald, will accept my apologies if I leave the Chamber immediately because I am now almost overdue at another meeting?
§ 6.4 p.m.
LORD ST. OSWALD
My Lords, I should like first of all to thank the noble Lord, Lord Champion, for the thoughtful and reasonable way in which he opened the debate on this Bill from the other side of the House. I had the impression that he was putting me in my place before the debate went any further when he referred to his having himself had some slight connection with the Ministry. He was, of course, Parliamentary Secretary at the Ministry of Agriculture. I was very grateful to him for paying tribute and extending his sympathy to the farmers in this fearful winter. I have expressed sympathy to so many farmers in so many parts of England during the past weeks that it sometimes seems to me that they must all know my sympathy; but I am very glad that they should know of both the noble Lord's and my joint sympathy and admiration for the efforts they have made to overcome the hazards. The problems of frozen ground and famished pigeons is as bad as anything they have known in the history of agriculture in this country.
I am sorry the noble Lord, Lord Walston, has gone. I was delighted that a debate on a Miscellaneous Provisions Bill should have been made that much more miscellaneous by the introduction of a hobby-horse. I will try to deal privately with the other things he mentioned, rather than refer to them to-night and so lengthen my speech at the end of what has been a fairly long and full debate. I am, of course, very grateful for the general measure of approval which this Bill has enjoyed during the debate. Some questions and criticisms have been raised, but before answering them I should like to thank those of your Lordships who have put suggestions which we will certainly consider when we are framing schemes or regulations under the various enabling clauses of the Bill.
It may be convenient if I start where the Bill starts, and where the noble Lord, Lord Champion, started—with the hill farming grants under Clause 1, and the relationship between these grants and the farm improvement scheme in Clause 3. The noble Lord, Lord Champion, was apprehensive lest improvement grants under Clauses 1 and 3 might be slashed in the context of the Price Review: he said he had read rumours 391 to that effect in the Press. The noble Lord and the House in general will appreciate that Her Majesty's Government are seeking the powers at present before the House in order to continue these schemes for capital grants for improving hill and general farms; and these improvements are not, in fact, taken into account in the Price Review determination. So I am happy to be able to reassure him on that point. The noble Lord was also disappointed that we had not taken this opportunity of extending the life of the improvement schemes under the Hill Farm and Livestock Rearing Acts, and he raised points about credit and grant under other schemes.
Your Lordships will recall that by November 5, 1963—which is the closing date for applications—hill sheep farmers will have had seventeen years in which to apply for schemes; and the livestock breeders further down the hill will have had twelve years. By then we expect that the bulk of the essential work will have been provided for in the schemes submitted. It is true that an extension of the scheme might find some farmers still coming forward with proposals, but the grants are quite generous and I think it should have been possible for the promoters of schemes to raise finance through the normal channels by now. We do not think it is necessary or desirable to go on extending the life of this legislation, partly because it was designed for a specific purpose which has so largely been fulfilled, and partly because other forms of assistance are now available for virtually all the work covered by this scheme. I have in mind not only the many grants and subsidies available from the Agricultural Departments but also the assistance which can be obtained from local authorities and the Forestry Commission.
The noble Lord, Lord Champion, also asked specifically whether hill farmers would be able to apply for rehabilitation schemes after November, 1963, under the farm improvement scheme. Although these are different schemes, there is much common ground between them. Most of the improvements to fixed equipment, except to dwelling-houses for which there are now local authority grants, could be considered under the farm improvement scheme if the farm met the 392 statutory tests. Improvements to land could probably be grant-aided under other schemes, such as the winter keep and grassland renovation schemes, drainage and water supply grants, and so forth, though at different rates in some cases.
My noble friend the Duke of Atholl asked about an extension of time to enable schemes to be submitted for farms which until the present occupier leaves cannot be amalgamated with other farms to make viable holdings eligible for grants. I agree that this may well be a problem in some instances. However, Parliament clearly intended that these grants should have a term, and the present legislation has been in operation for a good many years, as has already been said. We cannot, I think, keep the door open indefinitely for the sake of what may admittedly be hard cases, but only a few hard cases. The noble Duke will appreciate that it is possible to consider schemes covering several farms which would each be ineligible separately; and there are still six months in which to apply. Even so, if he finds it impracticable to submit an acceptable scheme there will, of course, still be grants available for most items under the farm improvement scheme.
He asked whether we would be willing to apply a lower level of fees for licensing pony stallions. We should not be justified in making such a differentiation. Mountain and moorland ponies which are not "travelled"—that is to say, taken from place to place for stud—are exempt from licensing in their native districts. But the costs involved in licensing the remainder are the same as those for any other type of stallion. Their values and service fees, though they range lower, can be as great as, or greater than, those of other stallions; and since we have accepted the need to recoup our costs as far as possible, I think we must deal with ponies on a par with other stallions. We are reviewing the licensing procedures generally so as to keep fees as low as possible. I cannot say what fees will be charged; this is a matter on which we shall be consulting with the industry.
The noble Baroness, Lady Burton of Coventry, asked about the circumstances in which the Horticultural Marketing Council was dissolved, and why my right honourable friend was not in a position 393 to finance it for a further period. As we all know, it was always intended that the Horticultural Marketing Council should eventually be financed by the industry. The Horticulture Act, 1960, under which the Council was set up, provided for this. The Government decided to finance the Council for the first three years to give it ample time to prepare a scheme for raising revenue from the industry. Unfortunately, the idea of an industry-financed Council received so little support from the industry that we had no alternative but to dissolve the Council. I promised the noble Baroness to do my best to obtain details of how the voting went. I understand that in fact only 4 per cent. of the N.F.U. fruit and vegetable growers bothered to vote at all. It is true that among those who did vote there was a majority in favour of retaining the Council. It is also true that both the wholesalers and the retailers voted against retention of the Council; but again the proportions of non-voters were 69 per cent. and 85 per cent. respectively. I therefore think it is fair to say that the Council was killed by apathy; we could not impose a Council and compulsory charges on an unwilling industry. I have a great deal more to say in reply to the noble Baroness, but perhaps she will allow me to come to it later.
The noble Duke, the Duke of Atholl, asked why Clause 8 does not run beyond England and Wales. I have to tell him that there is a tartan curtain, and that we are lifting the tartan curtain with this clause. The fact is that statutory provisions are already available in Scotland under Section 4 (5) of the Small Landowners (Scotland) Act, 1911. What I have to tell him is that Scotland is slightly ahead of us, but he is slightly behind his countrymen.
In reply to another point raised by the noble Duke, I should like to say a word or two about the Marginal Agricultural Production Scheme in Scotland. None of us would attempt to deny that this Scheme has done a great deal to help farmers on poor land. The Scheme has, however, run almost unchanged for a long time, and inevitably its limitations have become more apparent under the changing conditions of recent years. It was excessively concerned with arable cropping in an area which was, by and large, more suited to grass husbandry. It 394 also suffers from the disability that assistance often has to be limited, and it contains an inbuilt sort of "means test", which means that the larger and more progressive farm is liable to be arbitrarily excluded. Rather than adapt the old scheme, the Government have preferred to come forward with a new one which is better suited to the particular needs of the areas which it seeks to assist. The Government are confident that this winter keep scheme will prove of great value to the hill and upland areas in Scotland.
THE DUKE OF ATHOLL
My Lords, it is only in the last three years there has been this inbuilt means test. But it did have the effect of keeping up employment in these rural areas. Does the noble Lord envisage that the new schemes will have the same effect?—because I think that is a very important matter in these rural areas.
LORD ST. OSWALD
What they are aimed at is more efficient husbandry. That is what any Agriculture Bill seeks to do at the outset, and we hope that other things will follow in its train. That is the end to which an Agriculture Bill is directed.
The noble Lord, Lord Champion, took exception to the decision to dissolve the Agricultural Land Commission and its Welsh Sub-Commission, and I was not greatly surprised that he should do so. When the noble Lord, Lord Williams of Barnburgh, called these two Commissions into being he had a job for them to do—that of managing a large acreage of farmland which the State was attracting into its hands. But as far back as 1954 my noble friend Lord Crathorne announced our policy of disposing of this land which the Commissions have been managing on the Minister's behalf, and I am not aware that this policy has been challenged as a whole, except by certain members of the noble Lord's Party. It follows—and I think that the noble Lord, Lord Champion recognised this—that once this policy has been adopted, it is inevitable (to use his own word) that these high-level, highly qualified men are not fully employed, but are engaged in managing a reduced acreage; and of course, as he knows, the acreage is now down to just on 100,000 and is on its way to being still further reduced to something between 30,000 and 40,000.
395 The noble Lord said a kind word on the Irish sugar agreement, for which I was very grateful. The noble Lord, Lord Kilbracken, also agreed with the agreement we have made with Ireland. But it came in for a great deal of criticism from other noble Lords. A number of points have been raised. This is a most intensely complicated question. It was discussed in Committee in another place for more than two days, and I am not sure how effectively I can deal with it in a few minutes to-night. Perhaps I might start with Lord Merrivale's general criticism, that Clause 25 was the "odd man out" in the Bill, and that these Irish sugar arrangements were of sufficient importance to justify separate legislation.
I hesitate to follow the noble Lord and the noble Lord, Lord Milverton, in attempting to define the natural boundaries for a Miscellaneous Provisions Bill; but I would not necessarily accept the view that we must be guided by the relative importance of the subject matter. One calls to mind that the National Agricultural Advisory Service was brought into being under the Agriculture (Miscellaneous Provisions) Act, 1944; and that the Bill now before your Lordships is putting an extra £35 million into the Farm Improvement Scheme. This is very substantial legislation: these are not trifles. Moreover, as we have seen this afternoon, the inclusion of Irish sugar in this Bill has certainly not prevented us from discussing the agreement at great length, and we have doubtless to look at it in detail in Committee.
All I can say to the noble Lord to-night is that although many aspects of the agreement have been aired this afternoon, there is only one which calls for legislation and that is the extension of my right honourable friend's powers to give directions to the Sugar Board. With the present pressure on the legislative programme we must obviously minimise our claims on Parliamentary time, and I hope that your Lordships will agree that an omnibus Bill of this kind is a convenient vehicle for covering these additional powers. Of the four main features of this agreement I obviously need not defend the benefits which it confers on Commonwealth producers; the restrictions which it places on exports from the Irish Republic into Northern Ireland; and the prohibition of exports of refined sugar to 396 Great Britain. I should have liked to hear more general commendation of those advantages to this country in the course of the speeches.
There remains only our share of the agreement—that is, to buy some of their sugar—and this has been called into question during our debate. The changes we made at the beginning of 1962 in our pricing arrangements increased the Sugar Board's receipts from surcharge on Irish sugar by at least £150,000, and this was not passed on to consumers at the time. It was, in effect, paid by the Irish exporters. We think it reasonable to offer this assistance to the Irish Republic in their trade in sugar and the sugar content of their manufactured goods, since it will provide some compensation, but not full compensation, for the reduction in returns from sales to this country which they sustained as a result of the 1962 changes. These changes were directed against imports of foreign sugar, not against the Irish trade. We compensated at the time members of the Commonwealth Sugar Agreement for the similar effects on their exports; but we did not at the time compensate the Irish Republic.
There seems to be some misunderstanding about the consequences of this agreement for the Irish Sugar Company and for British refiners. In fact, however, it is not the accounting difference between the fixed price and the world price that is of significance for the Irish Sugar Company. The important thing for them is that we have undertaken to buy their refined sugar at a price which covers their costs of production. They are therefore arranging to replace 10,000 tons of the foreign sugar they previously imported for this trade by sugar of their own production. Therefore, my interjection during the speech of the noble Lord, Lord Milverton, had some significance in that they will cease to buy foreign sugar and will grow their own beet for their own sugar production.
In the sugar agreement with the Irish Republic we will guarantee a purchase of 10,000 tons of sugar for use in sugar-containing goods for shipment to Britain (a long established trade) at a fixed price which will enable the Irish Sugar Company slightly to increase the production of beet sugar in Ireland and replace an 397 equivalent amount of foreign sugar previously imported for this trade. They will not therefore, in practice, have any proceeds from the agreement to assist the export trade in refined sugar to Northern Ireland. This trade must, under the terms of the agreement, be covered by the purchase of Commonwealth raw sugar bought at the same price as British refiners pay for their supplies. Whatever may have been the past position, in future, because the trade will be based on sugar produced in the Commonwealth or in Ireland, there is no question of the Irish Company's having an advantage in the cost of the raw sugar used. In fact, of course, the agreement provides for a significant reduction in the export of refined sugar to Northern Ireland.
§ LORD MERRIVALE
My Lords, my noble friend referred to compensation to the Irish Sugar Company. Does he feel confident then in effect, as the agreement stands at the moment, that compensation will be achieved by the Irish Sugar Company?
LORD ST. OSWALD
No. The Irish will not be fully compensated for what they lost during the previous period.
LORD ST. OSWALD
The purpose has been partially to compensate the Irish Republic.
My Lords, the noble Baroness, Lady Burton of Coventry, asked me for some comfort in continuance of her series of Questions. All I can tell her is that the scheme for market research and development which is provided for under Clause 9, in which she was interested, stands on its own. Under it £1½ million is being made available over an experimental period of three years. I hope she will agree that this demonstrates the Government's desire to assist development in marketing; but the initiative must come from the industry. Clause 9 seeks statutory authority for grants which are already being made under the authority of the Appropriations Act. Anyone with an interest in marketing can apply for a grant to the Committee which the farmers themselves have set up for the purpose of vetting applications. I should have 398 thought that the noble Lady would regard that as a suitable method of vetting applications. It is for the Committee to recommend which projects should be approved for grant, but research into distribution and allied matters which has the prospect of early practical value can be eligible.
I should like to think that I shall be able to give the noble Baroness more satisfaction than I have been able to give her up to now in her series of Questions, which I enjoy as much as she does, or I hope she enjoys as much as I do. I would point out that some weeks ago I offered her figures on three commodities if she put down a Question. She has not put down a Question on those three commodities, but has pointedly put down a Question on a fourth commodity on which I had not offered her figures. But that is perfectly fair. I am still waiting for the Question that I am able to answer.
As a general summing up of to-day's debate, I think I can fairly say that this Bill has been welcomed as a useful measure. Some noble Lords would have liked the Bill to go further than it does, and other noble Lords have urged us to drop at least one of the clauses. I hope that I have been able to do justice to their arguments—if not, we can look at them in more detail in Committee. I shall look forward to hearing any points that noble Lords may feel inclined to raise at that stage. With its many assorted provisions the Bill certainly lives up to its name. But in their different ways these proposals are designed to promote the well-being of our all-important agricultural industry, and I commend the Bill to your Lordships as a measure fully deserving of your support.
§ On Question, Bill read 2a, and committed to a Committee of the Whole House.