§ 4.4 p.m.
§ THE MINISTER WITHOUT PORTFOLIO (LORD CHAMPION)
My Lords, I beg to move that the Meat Industry (Scientific Research Levy) (Revocation) Order 1966, be approved. I must begin by making it clear that this Order does not represent a change of policy on the collection of funds for meat research; the idea of a contribution from the industry for research remains basic. All that is intended is to discontinue what has proved an unsuitable method of collecting that contribution. The Order which it is proposed to repeal came into force in April, 1963. It linked the collection of the levy to the Fatstock Guarantee Scheme; a small payment was added to the buyer's bill, and double the amount was collected from the seller out of the guarantee payment.
In the conditions of 1963 this method of collection worked fairly well, because there was then a provisional rate of guarantee announced in advance and very seldom altered. This advance announcement allowed the collection of the levy to be suspended in weeks when the provisional rate was nil. A change was, however, made in the guarantee arrangements in the Annual Review of 1964. Now the guarantee payment is calculated retrospectively by reference to the average of the actual market prices in the week in question. The system also includes provision for an end-of-year payment if the guarantee for the year had not been met.
It was thought that this might have provided a means of collecting the producer's share of the levy due for weeks in which there had been no guarantee payment, but in fact, because of a very large increase in market prices, no end-of-year payment was due at the end of the fatstock year, 1964–65. As collections from buyers had had to continue, since it was not possible to tell at the beginning of a week whether there was to be a guarantee payment or not, this meant that money collected from buyers remained in the hands of sellers and did not reach the Agricultural Research Council for use on research.
908 After further experience of this unsatisfactory system in the course of the current year, we are convinced that the Order cannot be made to work efficiently and equitably, and that the proper course is to repeal the Order and to turn to a different method of collecting the levy. We have made provision in the Agriculture Bill which is under consideration in another place, so that charges may be imposed or payments made by the Meat and Livestock Commission in respect of meat research by the Agricultural Research Council. This will, of course, mean that for a short time no money will be collected from the industry for meat research, but the total sum collected will not be altered, and we shall end up with a much better method of collection.
It would clearly be right to take some appropriate action about the money for the levy which was wrongly collected from buyers last year and this year in weeks in which it turned out that, no guarantee was payable. The sum involved looks like being a little under £25,000. Such a sum clearly ought to be devoted to meat research, and we propose that, as a final settlement of this matter, a sum equivalent to the final sum wrongly collected from buyers should be paid out of public funds to the Agricultural Research Council to be devoted to meat research. In this way, the project for which the money was collected will receive the benefit and the total obligation of the industry will be reduced by the amount it has contributed. I ought perhaps to add that a meeting was held with the main interests concerned, at which it was agreed that the action we are proposing to take was a reasonable way of dealing with the situation. Written proposals to repeal the Order were also circulated, and no adverse comments have been received.
I think I should mention two other points. First, the provisions of the Agriculture Bill will apply only to Great Britain. Different action will be required in Northern Ireland, and I understand that the Minister of Agriculture in Northern Ireland will announce what he proposes as soon as possible. Secondly, the present Order applies, as far as Great Britain is concerned, only to cattle and sheep. The Pig Industry Development Authority have made a voluntary undertaking to contribute to the Agricultural 909 Research Council an annual sum for meat research equivalent to that which would have been produced had pigs been subject to the levy. My right honourable friends the Minister of Agriculture and the Secretary of State for Scotland propose to release the Pig Industry Development Authority from this undertaking if and when the draft Order now before the House is made. The new arrangements in the Agriculture Bill will, of course, cover pigs as well as cattle and sheep.
I think I may confidently commend this repealing Order to your Lordships. Because the guarantee system has been changed, the system of collecting the levy, which when it was originally worked out seemed simple and practical, is no longer so and can no longer be operated without great difficulties and inequities. A new scheme of collection is clearly required and, as I have said, new legislation is before Parliament which will permit a more satisfactory scheme to be prepared, based on a thorough study of all the problems involved.
§ Moved, That the Draft Meat Industry (Scientific Research Levy) (Revocation) Order 1966, laid before the House on December 1, be approved.—(Lord Champion.)
My Lords, I am grateful to the noble Lord, Lord Champion for having explained this Order in such detail because it is, of course, a complicated one. I think the main conclusion to be drawn from this is that the principle of collecting money for meat research has not been altered; it is merely the method by which it is to be collected which has been altered, and that is really what this Order deals with. It is not very frequently that one witnesses the spectacle of the Minister coming down to the House and saying, "The scheme that my Department has worked out has been proved to work out incorrectly and has not been satisfactory, and therefore we present a new one which we hope will be more successful." I do not say that in any carping way, because I think it is a gratifying experience to be told that Her Majesty's Government, of whichever Party it is composed, can occasionally make mistakes in the drafting of Orders and Bills and are prepared to come down with a fresh one when it is 910 discovered that the existing scheme does not work. I sincerely hope the new scheme will work successfully.
§ LORD ROYLE
My Lords, as one who has been engaged in the meat industry for many years I wonder if I might lend my modest support to the Order. I feel there is a real principle involved here. As the noble Lord has just pointed out, I think the new system will be a great improvement on the other, but the principle I have in mind is that when something is done for the benefit of the community as a whole then it should be the community which bears the cost. This has applied in the past in so far as various sections of the trade have had to pay their levy towards research. In the ultimate that research is not just for their benefit; it is for the benefit of the community as a whole.
If I might go farther, I would point out that in the Bill which dealt with meat inspection the payment of levies for inspection fell upon the trade itself. Inspection is in the interests of the community, to ensure that they do not get diseased meat, and I have always believed that the right principle was that the community and not the trade should bear the cost. I feel that this Order is to some extent in line with that; and if instead of its being in the form of levy which is now imposed it is going to be a payment through the new Commission, which is envisaged in the present Bill going through another place, then that indeed will be a great improvement on the present position. Therefore, while it may be only half way to the principle that I have in mind, I feel that in the end it will at least look much more reasonable and much more fair than the system which was, I think, brought in by the Conservative Government—in which case it is probably the fact that a Labour Government are putting right what a Conservative Government did wrongly.
§ LORD CHAMPION
My Lords, my noble friend discussed the principle involved, and it is true that there will be alterations in the Agriculture Bill from the method of collection which was decided in 1963, but I rather think he will again have to put his point when the Agriculture Bill comes before this House if he wants to maintain the 911 principle that the public and not the industry must pay. The noble Earl, Lord Ferrers, said he was glad that a Minister had come to the House and admitted that a scheme which had been prepared by a Department had not worked out very well. Of course the simple fact is that the scheme was prepared by the 1963 Government, which certainly was not ours. It is a scheme which would have worked admirably if the Ministry in 1964, which was the noble Earl's Ministry, had not put into effect a new system of guarantee payments without considering the side effects. It was one of the side effects of that scheme that the scheme of 1963 was rendered unworkable by a decision taken following the Annual Price Review of 1964. I do not make a great point of this, but it is just one of those things which can happen when great changes are made. Alterations have to be made subsequently to put right what, in this case, was purely a side effect. I hope that your Lordships will now agree to this Order.
§ On Question, Motion agreed to.