HL Deb 19 June 1974 vol 352 cc921-9

3.33 p.m.


My Lords, with the permission of the House I will repeat a Statement made by my right honourable friend the Minister of Agriculture, Fisheries and Food. The Statement is as follows:

"The Council of Ministers (Agriculture) met in Luxembourg on 17 and 18 June. There were two main items of business: a statement on behalf of the United Kingdom on the renegotiation of the terms of British accession to the Community in the agricultural sector and the current market situation for pigs and beef.

"On the former, I made a full Statement elaborating our aims as they had been set out by my right honourable friend the Foreign and Commonwealth Secretary on June 4. I have deposited copies of my Statement in the Library. In it I covered three basic areas. First, I outlined the ways in which the operation and mechanisms of the Common Agricultural Policy must be reformed. I emphasised the need not only to adopt clear criteria for future price determinations, but to implement them in relation to the requirements of modern efficient farms and to the supply/demand situation for individual commodities. I also asked that it should be accepted in principle that prices could, by agreement, be fixed for particular parts of the Community at levels lower than those applying generally. I proposed that the mechanisms of intervention should be modified so as to reduce automatically the incentive to produce more than the market requires; and that if surpluses accumulated they should be made available as a matter of priority to Community consumers.

"Secondly, I pointed to the need for improvements in the régimes for particular commodities. I laid particular stress on the need for a new regime for beef: one which should replace permanent intervention by variable subsidies and production grants, to the benefit of producer and consumer alike. I recognised that such a new régime could not be introduced before next April, and warned my colleagues that the difficult market situation might call for further Community action on an interim basis during the coming weeks.

"Thirdly, I dealt with the need for a general liberalisation and impovement of access for food imports from Commonwealth and other countries. For New Zealand, I proposed that the review of the existing arrangements should start this year rather than next; that prices should be reviewed annually; and that provision should be made for continuing imports of New Zealand butter after 1977 at broadly the levels envisaged then. We were also considering possible methods of dealing with cheese. For sugar, I emphasised the need to offer continuing access for 1.4 million tonnes of sugar from the developing countries, and said that arrangements were also needed for further supplies from Australia. Finally, I pointed to broad areas in which access for third countries to Community markets should be improved; and I gave examples where both levies and tariffs could be reduced to the benefit of consumers.

"I was able to point out that all the issues I had raised could be dealt with as important and urgent business of the Council. No member country dissented from this proposal and the Chairman of the Council declared that the various elements contained in my Statement would be dealt with in the framework of the work which the Council had set itself to carry out in the course of the coming months. This has been written into the Record. I shall look to the Council to approach these questions seriously and expeditiously; and I shall report to this House on progress as it is made.

"The second main item was the current market situation for pigs and beef. After full discussion in the Council, the Commission announced its intention of adopting the two further measures which I had sought in the interests of United Kingdom producers. On pigs, provision has been made for the continuation of the current special subsidy of 50p per score deadweight until September 1. Thereafter it will be paid at the rate of 35p per score until September 29, and at 15p until November 3. This amounts to total supplementary aid to pig producers of £30 million since March of this year. On beef, the increase in the United Kingdom guide price scheduled for January 31 will be brought forward to July 1. This should not raise prices to the consumer, for there are plentiful supplies available in this country. It is intended to sustain the market in a difficult situation. In consequence, the special subsidy in Northern Ireland will end on the same date, and subject to Parliamentary approval Northern Ireland producers will become eligible for the full rate of calf subsidy payable in Great Britain.

"In this meeting of the Council I have thus taken three measures to sustain confidence in the meat sector. First, I have secured the arrangements on pigs and beef which I have just described. Secondly, I have warned the Council of the possible need to take interim action to meet the beef market situation in the coming weeks. Thirdly, I have outlined the kind of Community regime for beef which should be introduced next year. These three measures are further evidence of the Government's determination to ensure that our livestock industry can continue to provide the nation with the supplies it needs in the years ahead."

My Lords, that is the end of the Statement.


My Lords, from this side of the House I should like to thank the noble Lord, Lord Goronwy-Roberts, for reading the Statement, which was exceptionally long and dealing with a particularly difficult and intricate subject. I should like to ask whether it is possible for the full Statement amounting to about 20 pages, which his right honourable friend Mr. Peart made in Luxembourg, to be made available in our Library, because there are a number of areas which will need elucidation. If I may say so, the Statement is not one which we would do well to debate at length here now, but may I take the opportunity of making two points? First, we support the Minister in regard to many of the areas in which he has reached agreement, especially in regard to the pig and beef sectors. These are areas about which the production industry in this country will feel some measure of relief. Secondly, it is encouraging to hear outlined the measures in regard to sugar, especially the arrangement forecast for the coming years. We shall be debating the calf subsidy to-morrow, and it would therefore be inappropriate to say more now.


My Lords, we should like to thank the Minister for repeating the Statement to the House, and I should like to ask only two or three questions. First, when is it expected that the Council of Ministers will respond to the proposals put by his right honourable friend? Secondly, the Minister referred in the Statement to the possible need to take interim action to meet the beef market situation in the coming weeks. It is our impression on this Bench that farmers in this area are not confident, and that something positive needs to be done immediately. I should like to ask the Government what they have in mind here, because the feeling in the farming industry is that the position is very serious indeed.


My Lords, I am most grateful to both noble Lords for their contributions. It is at least agreed that it is a long and complicated Statement, and a copy of the document to which the noble Lord referred will certainly be placed in the Library. He also said that there would be general support in at least most of the areas covered by the document, particularly for the measures proposed to sustain confidence in the future policy on pigs and beef. We believe that this is so, and that the interests of consumers will in no way be harmed.

We are very strongly in favour of there being a continuing arrangement on sugar, especially for developing countries, for at least some years ahead. We have also raised the question of imports of Australian cane sugar which are a very valuable addition, especially in the tight market situation in sugar which we are experiencing at the moment. We look forward to joining those two issues—developing countries' sugar and Australian sugar—in the negotiations ahead. On the calf subsidy, I took note of what the noble Lord said about the fact that your Lordships will be debating this subject to-morrow and no doubt, from time to time, reference will be made to the arrangements which are being made, especially in the Northern Irish context.

The noble Lord, Lord Byers, very rightly stressed the concern that is felt in the industry. It is no good denying that there is considerable concern and anxiety, especially in the pigmeat and beef sectors. My right honourable friend has said very clearly and firmly to the Council of Ministers that he would wish to have this subject discussed as a matter of urgency—and that means in the next few weeks—as occasion and need arise. As regards the movement of the beef market, it is a little early to decide whether the present slide and the sudden dip, which only last week emphasised the trend in the beef market, will continue. But we have very much in mind the need for further discussion at very short notice, if this slide is accentuated and causes further anxiety.


My Lords, I must declare an interest in that I am a beef farmer. Can the noble Lord be more forthcoming in saying what interim action his right honourable colleague will take on the beef situation? As he rightly said, beef prices are falling, most costs are going up. Wages have gone up with the threshold agreement in the last week or two—concentrates, admitterly, are falling a little—and fertilisers, like everything else are going through the roof, so beef farmers are really very worried. Can the noble Lord tell us in greater detail what interim measures or ideas he has for the protection of this vital industry?


My Lords, we have abrogated the derogation which was granted to us in March, bringing forward to July 1 the new prices which would operate in January next. We expect that this will have a steadying effect on the markets and will sustain confidence in the industry. If not, my right honourable friend has said that he will immediately seek further discussions and, if necessary, further measures. I cannot elaborate at this point.


My Lords, I thank my noble friend for the Statement, which I am pleased to say offers some amelioration for the sugar producers. Having been in Fiji when we made the international agreement for Fiji to have its markets for sugar, may I ask whether some amelioration has also been offered to that pleasant little island which, at least, has some good rugby players? Finally, whatever our politics on both sides of the House, we do not want to see British agriculture dominated too much by outside influences. We can have a healthy Britain only with a healthy British agriculture, and this is a critical point in the beef producers' history.


My Lords, I can assure my noble friend that the phrase "developing countries" covers all those countries which so largely depend upon the export of sugar. May I say that the conjoining of sugar with rugby comes very pleasurably to my ears.


My Lords, may I ask my noble friend about the sugar agreement? When the sugar agreement was reached, certain assurances were given to this House by the noble Lords opposite who then occupied the Government Benches, but I am afraid that they have not been borne out in practice. It has been for this Government which succeeded to try to protect the sugar interests in Australia and elsewhere. Secondly, may I ask about beef and pig production? I shall not seek to exaggerate what we have achieved at this time, but it is very much greater in support of pig and beef production in this country than was achieved by noble Lords opposite. I do not think we have reached a panacea, but I would say that over this interim period this Government and my right honourable friend Mr. Peart, the Minister for Agriculture, have at least achieved for Britain something that noble Lords opposite failed to achieve when they were in office.


My Lords, as my noble friend said, this is not a complete panacea—very few things are in this sector for very long. But it is a very substantial contribution to steadying the market, and, above all, to instilling a new confidence in this industry. We are all conscious of the anxieties to which the noble Lord, Lord Byers, referred. I know that my noble friend made a distinguished contribution in this field during his tenure of office in the Ministry of Agriculture and, with his special knowledge, he knows that what has been achieved since March is very considerable indeed. As regards sugar, it is of course true that what we originally had from the other side of the House was a "firm intention". This was ultimately transformed, with some bilateral, bipartisan help, into 1.4 million tonnes, which I am told is very much the same as tons.


When my noble friend referred to the document which he is to place in the Library, are we to understand that it is a different document and longer than the one available to-day in the Printed Paper Office? If that is so, and in view of the fact that that document will no doubt be produced by some mechanical or photographic means, can a few extra copies be run off so that any noble Lord who wishes to see the document in full may take the opportunity of so doing?


My Lords, I am grateful for the intervention of the noble Lord, Lord Leatherland, in case I have unwittingly misled the noble Lord who raised the point originally. Certainly a copy of the Statement will be in the Library. I think it would be expected that a copy of the speech could be placed in the Library also. In any case, I give a guarantee that it will.


My Lords, does the Minister really think the proposals being made for support to the pig subsidy can lead to a lessening of the rate of slaughter of sows? While the subsidy is at present at 50p there have been considerable slaughterings of sows, and that may well continue as the subsidy has been announced as decreasing to 39p and, if I heard rightly, in September to 15p. I find it difficult to appreciate how this will bring any comfort to pig breeders in this country.


My Lords, I take the point of the noble Lord, Lord Balerno. I am advised that the expectation is that this support will in fact assist pig herds.


My Lords, the Minister keeps on talking about the stabilising of the beef market. Is he aware that to stabilise something at a loss of approximately £30 per animal is hardly likely to encourage the beef industry? Is he further aware that the loss has just about doubled since March'?


My Lords, perhaps I should have said "stabilise the position". I was addressing myself fairly to the consumer point raised by the noble Lord. We do not expect this will raise prices for the consumer, but we hope that it will arrest the slide which the noble Lord, Lord Byers, reminds us has been proceeding for some time, and which only last week took a disastrous turn. So we expect it would stabilise the trend, and at least arrest the slide without unduly adding to the burdens of the consumers, if at all. Incidentally, if this does not work, we shall look at the position de novo and act immediately.


My Lords, would the noble Lord accept that this subject is of great interest to every British consumer, and to the British agricultural industry? Would he also accept that it is a major factor in the future of our renegotiation of the terms of entry to the E.E.C.? Is there any chance of having a full debate on this subject? It seems to be something that is not wholly suited to debate by question and answer in the form to which we have been listening recently.


My Lords, I am always responsive to the suggestion that a subject of this complexity is not susceptible to proper discussion by question and answer. Nevertheless, extremely useful and opposite points have been made from both sides of the House this afternoon. No doubt the Leader of the House and others who discuss the arrangements for Business will have heard what has just been said by the noble Lord, Lord O'Hagan.


My Lords, in his reply to my question, my noble friend said that he would arrange for a copy of the longer document to be placed in the Library, but I do not think he quite answered the main point I made. My main point is that the long document will have to be produced by some mechanical or photographic means. Therefore, instead of running off a single copy to place in the Library, could not a few more be run off which we can obtain from the Printed Paper Office?


My Lords, I do not think the resources of Parliamentary technology will be exhausted by that suggestion. I will do my very best to meet the suggestion of the noble Lord, Lord Leatherland.


My Lords, may I suggest that sometimes the noble Lord might wear his hat in the capacity of Minister of Agriculture, the agricultural side, and not always wear it as Minister of Food?


My Lords, I think there is only one appropriate comment to that—heaven forbid!