HL Deb 16 July 1964 vol 260 cc376-9

My Lords, I do not propose to spend a great deal of time in speaking on this Order. Its provisions, though complex, are logical. It is concerned entirely with arrangements for calculating and paying the subsidies to cereal growers, and the need for the Order arises from the new standard quantity arrangements for wheat and barley which were announced after the last Annual Review.

In the White Paper dealing with that Review Her Majesty's Government set out new arrangements to apply to wheat and barley for the 1964–65 crop and specified standard quantities and target indicator prices. The Order before your Lordships' House provides statutory authority for these arrangements in general terms. The precise standard quantity and target indicator price arrangements for a particular year are, of course, matters for annual determination by Ministers in consultation with growers' representatives. Your Lordships will recall that the growers' representatives were consulted on the new arrangements and agreed to them in the context of the 1964 Annual Review settlement. The new Order does not change the method of calculating and paying subsidy on rye, oats and mixed cereals; nor is any change made in the tonnage basis on which the wheat guarantee is paid or in the acreage basis for barley payments. I commend this Order to your Lordships' House as a necessary step in the implementation of the Government's policy for cereals on the domestic front. I beg to move.

Moved That the Cereals (Guarantee Payments) Order, 1964, be approved.—(Lord St. Oswald.)


My Lords, I regret that on this occasion the noble Lord did not, as is his custom, explain the Order we are asked to approve, but perhaps in this matter he was following the path of discretion. I should like to ask him one minor question and one major question. The minor one concerns the inclusion in the Order of rye, oats and mixed cereals. We are told in the Order that 'millable rye' means rye which is sweet and in fair merchantable condition, reasonably free from sprouted grains and so on. The explanatory note at the back of the Order, which we are told "is not part of the Order, but is intended to indicate its general purport" states: The changes effected by the order relate only to wheat and barley… Therefore my minor question is: why do we have to include rye, oats and mixed cereals?

The major question I wish to put is, of course, in respect of wheat and barley. I want to ask the noble Lord how, in his view, this Order will give farmers any indication whatever of the price they are likely to get for their crop? Obviously this is a matter of importance to farmers in determining what they will grow. The Order provides, for example, in the definitions, a definition of the word "determined" and it says: 'determined' means determined by the Minister with the approval of the Treasury…". For many people those are extremely ominous words. As I believe the noble Lord said, this Order provides that there shall be determined for wheat and barley a guaranteed price per cwt., a target indicator price and a standard quantity, all of which are intended to determine between them what will be the final price which is received by the farmer for the wheat or the barley that he grows?

I would draw your Lordships' attention to Regulation 4 of the Order. I shall be most grateful if the noble Lord, Lord St. Oswald, will tell us, in his own inimitable fashion, what precisely this Regulation means. Regulation 4 contains these words: If in any year the annual production of wheat or barley— (a) is not less than the standard quantity the guarantee payment shall be the amount, if any, by which the guaranteed price exceeds the target indicator price, or the average realised price, whichever is the higher, after that amount has been divided by the proportion that the standard quantity bears to the annual production". That is a perfectly clear statement; any one can follow it. But of course it is full of imponderables, and so, although you can follow the statement and probably know exactly what it means, it is utterly impossible to carry out what it means in pounds, shillings and pence. This is a matter which is of some importance to farmers in helping them to decide whether they are going to grow wheat or barley and, if so, what acreage; or whether they go out of business altogether and do not grow either. So we cannot dismiss this lightly, even if we erudite Members of your Lordships' House understand what that paragraph means.

Then paragraph (b), which is also a qualifying paragraph, says this—it is still the same regulation, and you can take your choice: (b) is less than the standard quantity and the average realised price is higher than the target indicator price the guarantee payment shall be the amount, if any, by which the guaranteed price exceeds the average realised price to which amount shall be added a proportion of the amount by which the average realised price exceeds the target indicator price, arrived at in accordance with arrangements determined by the Minister. I may say that I have paused in reading that paragraph to indicate where commas would normally appear. I can assure your Lordships that I am not making this up. This is actually in the Order. I will spare your Lordships paragraph (c), which I am quite sure you have all studied as carefully as I have, but will bring you to the end of Regulation 4, which reads: Provided that where the annual production falls short of the standard quantity by such amount as may from time to time be determined by the Minister and the average realised price is lower than the target indicator price, any guarantee payment under this paragraph shall be reduced by a proportion of the difference between the average realised price and the target indicator price arrived at in accordance with a scale determined by the Minister. I point out that of course the Minister cannot possibly determine any of these things, and certainly cannot determine the scale until well after the harvest.

I know that we can either reject or accept this Order; we cannot amend it. But I would submit, in all honesty, that we shall have to invent a new word for this kind of verbiage, because "gobbledygook" no longer applies; it must be something which takes us further than that. The important thing is that it is quite impossible for farmers to have the slightest indication of the price they are likely to receive for their crops. At one time, when my noble friend Lord Williams of Barnburgh was in charge of the agricultural affairs of the nation, when a farmer put his plough in the field, although he did not know what kind of crop he was going to get, he did know what price per cwt. he was going to get for the crop which he finally realised. These conditions no longer apply.

It is true that we have what is generally supported, although not by me: the deficiency payment system. But what is also true, unhappily, is that this Order, which we are now asked to approve, is completely incapable of being understood by anyone or explained honestly; it destroys any chance of a farmer using it to decide what he should grow, and of course destroys, finally and for all time, the illusion that there is any longer a guaranteed price. I should be most grateful if the noble Lord would throw some light on this subject, which he did not do in his speech commending the Order to your Lordships.