HL Deb 24 April 1975 vol 359 cc1109-15

7.15 p.m.

Lord STRABOLGI rose to move, That the draft Meat and Livestock Commission Levy (Variation) Scheme (Confirmation) Order 1975, laid before the House on 26th March, be approved. The noble Lord said: My Lords, the effect of this Variation Scheme Order is to increase the present statutory limits within which the Meat and Livestock Commission must fix their rates of levy on the industry and, secondly, to change the incidence of the levy. In talking about the new rates required I will take as a basis, for the purpose of illustration, the cattle rate. This is at present 30p per head, which is the maximum permitted by the present Levy Order made in 1968. The National Farmers' Union, with the support of the meat trade, is keen to launch a large-scale meat promotion scheme under the auspices of the MLC, which will require an increase of 20p per head in the cattle levy rate to finance it.

There is widespread agreement that this meat promotion scheme should go ahead and this can be achieved only by making this Order to raise the statutory levy rates the Commission are permitted to charge. The producers have agreed that, with the launching of this scheme, arrangements should be made for the levy to be shared between producers and distributors. This Order therefore enables slaughterhouse operators who have not wished to be solely responsible for paying the levy to the Commission, to recover by law up to half the levy from persons from whom they buy animals for slaughter. At live auctions it is intended that the slaughterers shall be empowered to recover 50 per cent. of the levy from the auctioneer. I am sure that your Lordships would wish me to acknowledge the cooperation of the livestock auctioneers in helping to make this arrangement possible.

The House may like to know how the MLC meat promotion scheme will affect the Scotch Quality Beef and Lamb Association's scheme. This Association was set up last year to promote sales of Scotch beef and lamb and some 10,000 farmers have voluntarily agreed to levies being deducted by auctioneers from the sales of fat and store animals to provide income for this purpose. The MLC have been anxious not to upset this scheme and have agreed with SQBLA a plan which will enable the Association to work alongside the MLC in meat promotion. Scottish auctioneers will continue to collect the levy for SQBLA on live weight sales at store rings, and the MLC will add an equal sum from the levy income raised on slaughterings up to a maximum of 40 per cent. of their promotion levy income in Scotland. I have no doubt that with the goodwill that obviously exists on all sides the two schemes will be able to co-exist quite happily.

This Order is also needed to enable the Commission to maintain their existing services, since inflation has overtaken the statutory rates set over six years ago. For several years the Commission have allowed their reserves to run down and if levy rates are not increased it is estimated that the Commission will have a deficit by the end of September, 1975, of £484,000 and that their reserves will have fallen to the critical level of £66,000. In addition to the 20p per head on cattle required for the meat promotion scheme, the Commission's normal work would require an increase of some 14p per head on cattle in May, rising to 18p later this year. Thus, I submit, there is a need for increased levy income which would raise the cattle rate to 64p per head immediately and to 68p per head later. It would seem right, as was done in 1968, to seek the agreement of the House to fixing maximum rates somewhat above these immediate requirements. The proposed levels, based on 90p per head for cattle, are therefore set to enable the MLC to continue their work for a further period.

My Lords, the Commission, as will be seen from the wide-ranging activities which arc described in their recently-published report and accounts, arc now well-established in carrying out the duties laid upon them by the Agriculture Act 1967. These are to promote greater efficiency in the livestock and livestock products industry. I should like here showed the way by which livestock to pay tribute to the present Commissioners and to their Chairman, Mr. George Howard, for the way in which they are undertaking their duties.

My right honourable friend the Minister has had consultations about this new Order with the main industry organisations concerned in the meat and livestock field. He is mindful of the views expressed about the need to keep down the Commission's costs as much as possible, particularly during the present difficult economic circumstances, and to ensure that the cost effectiveness of the Commission's activities is fully maintained. The MLC have also suggested that the consultative arrangements for the meat and livestock industries could, with advantage, be reconsidered. Ministers are therefore asking officials, in consultation with the Meat and Livestock Commission and with the industry organisations, to examine further the views which have been expressed and to report on the results of their discussions. The meat and livestock industries cover a wide and diverse field of activities within which there are bound to be conflicting interests and divergent views. It is greatly to the credit of the Meat and Livestock Commission that, today, virtually every sector of the industries concerned recognises the need for such a body and that it should have the resources to continue its function of seeking to improve the production, marketing and distribution of meat and livestock in this country. My Lords, I beg to move.

Moved, That the draft Meat and Livestock Commission Levy (Variation) Scheme (Confirmation) Order 1975, laid before the House on 26th March, be approved.—(Lord Strabolgi.)

7.22 p.m.

Earl FERRERS

My Lords, whenever the noble Lord, Lord Strabolgi, is good enough to introduce an Order or, indeed, any subject relating to beef, I imagine that he must do so with a certain degree of temerity because we on this side of the House have not always seen eye to eye with the Government over beef policy during the last 12 months. However, I can assure the noble Lord that on this occasion we welcome this Order. We are grateful to him for introducing it and for explaining what it does. As he said, it raises the levy from what appears to be a relatively small sum to a relatively large one, by raising it from 30p to 90p a head on cattle. Even in these days of inflation that might cause a slightly querulous eye-brow to be raised, but it is comforting to know that, though the Meat and Livestock Commission have the ability to raise the figure to 90p per head, they do not intend to use it. It is also interesting to note that, even though they had the power to raise the levy to 30p when they first started, way back in 1967, it was only 12 months ago that the figure was raised from 20p a head to the maximum of 30p per head allowed under the present regulations.

I believe that there are few who would doubt that the Meat and Livestock Commission's work and contribution to raising the standards of meat production and marketing in this country have been very substantial, despite the short period of time during which they have been operating. They have been involved in marketing, in disseminating market information, in carcase testing, in slaughterhouse improvement, in livestock improvement and in progeny testing. In all these spheres the effect has been very considerable. It is not easy, because it mostly has to be done by persuasion and leadership. Those who remember the days of the Pig Industry Development Authority, in which my noble friend Lord Balerno played such a distinguished part, will recall the respect in which that Authority was held in the agricultural sphere. When the Meat and Livestock Commission took over that body, I feel that they also took over the respect which it enjoyed. Indeed, they have generated their own respect in the agricultural community for what they have done. It is not just the looks of the animal which are important: it is the ability to achieve a good carcase, to put fat where it is wanted and not where it is not wanted, and to ensure that the animal is a good food converter, that is important. These are problems of breed improvement with which the Meat and Livestock Commission are having to involve themselves. It takes me back to my halcyon days at Cambridge when I was a struggling pupil of the late Dr. John Hammond, who did such a great deal for livestock improvement and who improvement could be measured in the future. His was a very great contribution.

My Lords, these are difficult problems and successes to quantify. I would say merely that I believe that the Meat and Livestock Commission have done an extremely good job of work and that they have a very important job of work to do. I pay tribute to them for what they have done and, now that they are to have such an increase in the levy—and I am sure that they will not squander it—perhaps I may remind them of the way in which all begging letters used to end, that is, with the words, "Thanking you in anticipation."

7.28 p.m.

Lord LLOYD of KILGERRAN

My Lords, I should like to thank the Minister for the helpful manner in which he has introduced this short Order. Short the Order certainly is, but it is of great importance to the small producer of meat and livestock. I am familiar only with the Meat and Livestock Commission's activities on their farm in North Wales, and I have visited their regional offices in Aberystwyth. However, so far as Wales is concerned, the information so often circulated by the Commission to small Welsh meat and livestock farmers seems to be of a meagre nature. Many of the Commission's publications seem to me to be inadequately orientated towards the needs of the small Welsh farmer.

My Lords, the Commission, it appears from the Order, will have a discretion in relation to the increases in charges. They appear from their accounts to be a wealthy body, with an income of about £ 6 million a year in 1974, in which year they made a profit of £ 113,000. They have substantial assets. They have a large staff— or they had in 1974— of 1,250 persons. I do not know what steps the Commission have undertaken to rationalise their own structure and thus make savings internally.

Therefore, I presume to make a plea, first, that this scale of charges— which are certainly not insignificant to the lives of the small producers of meat and livestock— should be varied on a regional basis; and, second, in so far as small meat and livestock producers in Wales are concerned, the Commission should not enforce the proposed increased charges upon the meat and livestock producers, at least during this difficult financial period which they are now passing through. I make this plea knowing that the Minister will give it sympathetic consideration.

7.32 p.m.

Lord STRABOLGI

My Lords, I am very grateful to the noble Earl, Lord Ferrers, and the noble Lord, Lord Lloyd of Kilgerran, for the welcome they have given to this Order. I am sure we shall all be grateful for the tribute that the noble Earl paid to the work of the MLC. He described some of its work which I felt I had not time to do in my speech. He spoke of the great work it does in promoting livestock improvement, much of which has been described in the Commission's last Report.

The noble Lord, Lord Lloyd of Kilgerran, said that he hoped that the Commission would not squander the income from the increased levy. I can assure him that this will not be so. I agree that a number of major capital expenditure items fell during 1973–74. But I have no reason to believe that this was directly attributable to the last levy increase. The proposed increases are designed to finance the MLC's ongoing activities and to restore a reasonable operating balance. The noble Lord, Lord Lloyd, also asked me about the charges and he suggested that they might be on a regional basis and variable. This is an interesting suggestion, but I think it would distort the auction system, because animals would obviously be sent to the auction centre in a region where the rates were most advantageous.

Secondly, I would remind the noble Lord that the benefits are evenly distributed, though it would seem, following that, that the levy should be evenly distributed as well; although we will take note of what the noble Lord said. We shall certainly also pay particular attention to what he said about the advisory leaflets. These leaflets deal with very technical matters, but I am sure there is a case for making them simpler, whereever possible, or indeed for having some sort of simple explanatory note, as Parliament has when these Orders are laid. This is certainly one of the matters that I am sure will be discussed between the Commision and the meat and livestock industries during the consultations that they intend to have, and to which I referred in my speech. I hope that that answers the various points raised.