PRICE STABILITY OF IMPORTED PRODUCTS (SPECIFIED COMMODITIES) (POULTRY MEAT) ORDER 1971 (Hansard, 3 August 1971)

EARL FERRERS
My Lords, I beg to move that the Price Stability of Imported Products (Specified Commodities) (Poultry Meat) Order 1971, laid before your Lordships' House on July 20, be approved. The Order is made under Section 1 of the Agriculture and Horticulture Act 1964 which enables Ministers to make Orders introducing minimum import price and levy arrangements in the interest of maintaining in the United Kingdom a stable market for agricultural and horticultural produce of any description produced in the United Kingdom ". As your Lordships will see from its title, this Order is about poultry meat; and I shall start by explaining why the Government are now asking your Lordships to approve it. Imports of uncooked poultry meat into the United Kingdom have been prohibited on veterinary grounds from most countries in the world since 1955. During that time the Government have tried to control fowl pest, first by a policy of slaughter and compensation, and more recently by the use of dead vaccine. Either policy would have been prejudiced if we had allowed the import of birds from countries allowing the use of live vaccine. However, the Government decided last December to allow the use of live vaccine in this country, and in announcing this decision my right honourable friend the Minister of Agriculture, Fisheries and Food announced that once live vaccine was effectively in general use the present veterinary controls on imports would no longer be required or indeed be justified. From October 1 imports will be permitted, subject to official veterinary certification, from countries which have not in the past been able to send poultry meat to this country.
However, my right honourable friend also made it clear that, before the time came to remove the present veterinary restrictions, the Government would be 1100 considering what measures were necessary to prevent"unduly low-priced"imports. There is no doubt about the need for such measures. In all the highly developed poultry industries of the world there are periods of over-production. When that happens, one way of bringing the market into equilibrium again is to export some of the excess stocks. But the number of export markets is very small—many countries have import restrictions of one sort or another—and so the competition for export markets is intense. When the prime object is to liquidate excess supplies, export prices may be accepted that are very low indeed. This can have very disruptive effects even on a highly efficient poultry industry like our own. The interests of producers and consumers alike require that the industry should operate in conditions of reasonable stability. These conditions cannot be maintained if the market is undermined by the threat of disruptive imports. We are therefore anxious to ensure that our industry can continue to meet—as it has in the past—the needs of virtually the whole of the home market at very reasonable prices.
With this end in view, the Government have decided to introduce minimum import price arrangements, and my right honourable friend gave details of the proposed arrangements to the House of Commons on July 19. The first step in introducing them is to specify the commodities concerned, and that is what this Order does. It specifies dead poultry—fowls, ducks, geese, turkeys and guinea fowls—as commodities for which Orders may be made prescribing minimum import price levels and charging levies to maintain those levels. The Order covers all uncooked poultry meat, whether fresh, chilled or frozen and whether in the form of whole birds or parts of birds. The further Orders prescribing the actual levels of minimum import prices and the arrangements for charging levies will be laid before Parliament in due course; but, as I said, the details of the Government's proposals were announced on July 19 so that your Lordships should be in a position to see how the Government intended to use these powers. With that explanation, I beg to move.

§ LORD HOY
I am grateful to the noble Earl for what he has said about this Order and the proposals which were announced on July 19. Indeed, when the Order came to be presented in another place on, I think, July 30, not a single word was said, because on Friday afternoons Members are all in"another place"and if you want to get an Order through, that is the time to take it. So there was no debate at all upon this Order and this is the first time it will have been discussed in either House. One sympathises with the poultry industry because of the tremendous slaughter that took place due to fowl pest disease. Indeed the Government, I think even against their will, adopted the policy of using dead vaccine to cope with the trouble, because up until then its use was not permitted in this country. As a consequence, obviously we did not allow importation from other countries where the vaccine was used. This was the sole reason for the tremendous slaughter which the industry had to bear.
May I ask one other question? It is true, of course, that one ought not to allow the whole industry to be disrupted by very cheaply produced or subsidised exports from countries other than our own, countries that may well be faced with surplus quantities and who might decide to get rid of them at cheap prices by exporting them to this country. It seems to me that we must not reach a position where this is used as a reason for allowing prices to get out of balance in this country. This is the second Order of this kind that we have had—at least we had a similar one on meat prices—and the more we restrict the industry in this way quite obviously the higher prices are going to get. At the end of the day it is the housewife who will have to pay these increased prices. The production of poultry in this country has made remarkable strides. Its contribution to the meat supply of the country is very great indeed compared with a few years ago. We are entitled to ask the Government for an assurance that, while they may be protecting our home industry, which is a first-class industry, producing very efficiently indeed, advantage will not be taken of that position to pass on further increases to the housewives of this country. Therefore, while we may have no objection to the Order on that 1102 score, at least we are entitled to ask for an assurance.
Indeed, I should like to put one further question to the noble Earl, because while he says that this Order is made under Section 1(2) of the principal Act, under a further section—and he will know the one to which I refer—provision is also given to the Government to cancel these levies for certain reasons. As I understand it, if this has to be done, again it must be done by Order. Subsection 3(a) says that the Government may by order provide for the granting…of allowances or reliefs in respect of the levy (if any) chargeable on the imported commodity. So obviously, having taken that provision under the principal Act, it was done for some reason. I should like to know, if in fact it was found that these levies were proving impossible and were putting up prices to the consumer and the housewife, what powers the Government have to remove them, apart from another Order, because subsection 3(a) says that,"it may by Order provide ".
I wonder whether this is the quickest way to deal with this problem if it should arise. I ask this not only so that we may have an assurance about prices, but also to inquire what will happen if they reach the stage at which prices are rising and levies are not required. What speedy action can we then take to protect the housewife from the high prices she would be asked to pay? I am sure that the House will be grateful if the noble Earl can reply to these points.

EARL FERRERS
My Lords, I am grateful to the noble Lord for his welcome of this Order. At the outset he referred quite rightly to the fact that this was required because of the problems of fowl pest by which we have been beset in this country over the last few years. It is a measure of the effectiveness and indeed the efficiency of the British poultry industry, that, despite the ghastly problems of fowl pest—and they have been monumental: first of all with the slaughtering and compensation policy, whereby huge numbers of birds were slaughtered, and then by means of the dead vaccine which was not wholly effective; then by the current use of the live vaccine, which is not 100 per cent. effective either—they have 1103 managed to overcome these problems and still remain highly competitive. I can assure the noble Lord that the minimum import prices which it is intended to lay on the poultry industry will not result in a method of subsidising unfairly the home-produced commodity because if he knows, as I am sure he does, of the complexities of the poultry industry, he will know that in fact they have run into considerable problems in the past and that it is not an industry where vast sums of money are readily to be made, simply because there is always the ever-present danger of over-production.

§ LORD HOY
I think the noble Earl has misunderstood me. I was not talking about a subsidy: what I wanted was an assurance that this Order will not result in unfair price increases to the housewife. Someone has to carry the burden if levies are imposed—someone has to pay for them—and all I ask for is an assurance that this will not be used as a method for increasing prices to the housewife.

EARL FERRERS
I did not misunderstand the noble Lord, but probably I did not express myself quite accurately enough. This will not be used as a method of keeping up prices, or rather charging an unfair price to the housewife. All that it will do is to prevent very low-priced imports coming into this country which may be almost equivalent to dumping. This, as I am sure the noble Lord will appreciate, is not something which is required in order to keep any form of market stable.
On his second point about the alteration of the levies, this is done by Orders which are subject to the Negative Resolution procedure, and a new Order can be laid very quickly should it be found that any untoward effect is occurring. I think the noble Lord need have no doubt of the fact that it is the Government's intention that the minimum import prices should be such as to make the home-produced product adequately and reasonably competitive and merely to prevent the virtual dumping of unduly low-priced poultry meat.