HL Deb 09 June 1975 vol 361 cc81-93

6.37 p.m.

Lord LOVELL-DAVIS rose to move, That the White Fish and Herring Subsidies (United Kingdom) Scheme 1975, laid before the House on 6th May, be approved. The noble Lord said: My Lords, the purpose of this Order is to provide for payment of aid to the fishing fleet in respect of the first six months of this year. Details of the Government's proposals were announced on 27th February. While apologising for the fact that the necessary Order was not made sooner, I will explain in a moment the reasons for this delay.

It is generally known that the fishing industry, both abroad and at home, is going through a very difficult time. The early 1970s were profitable, but a sharp reverse occurred in 1974. Operating costs rose steeply, led by the savage increase in fuel prices; but the returns received from the sale of fish did not follow suit. Fresh fish is marketed traditionally by auction at the port of landing, and the auction price is dictated by prevailing supply and demand, which is influenced by imports, the stocks of frozen fish and also the price of competing foodstuffs such as meat and poultry. Market factors of this sort kept down the fishermen's return while their inescapable costs soared.

Some sectors of the fleet were showing signs of trouble during the latter half of 1974. But generally the industry had reserves from the previous period of profitability on which to draw. By the turn of this year, however, the position had become much worse. More and more voyages were undertaken at a loss. An increasing number of vessels were being scrapped, laid up, sold or put to other work. Without some hope of either improved profits or aid in the near future, the rate of run-down of the fleet was in danger of reaching unacceptable proportions, with all the social, economic and structural problems entailed. Of course, a severe rundown of the fleet, once its less economic units had been eliminated, could only mean loss of catching capacity for the future. This might have meant later shortages and high prices to consumers, or an increase in the import bill which the nation can ill afford.

The 400-odd ships of the United Kingdom deep water fleet still land nearly half of the total catch of white fish and appreciably more than half of the supply of certain important species. The remainder is landed by about 6,000 vessels of the inshore fleet. It follows that any sudden changes in the composition of the deep-sea fleet have a more immediate and significant impact on supplies. This sector of the fleet is ageing. Reinvestment decisions have been deferred, pending clarification of where and under what conditions deep-sea fishing may be possible in future years. Many units designed to operate under different circumstances, particularly cheap fuel, cannot cover voyage costs under present conditions. The most uneconomic examples were quickly withdrawn from service, but many others remained at risk.

The Government were therefore faced with the real prospect that vessels accounting for a significant proportion of supplies might be lost irretrievably in a very short time, with far reaching consequences not only on food supplies (replaceable only by purchases across the exchanges) but on the whole structure of the industry. The Government therefore felt it right to provide aid, to give the industry time to respond to the changed circumstances in a more orderly fashion.

As the problem had, to a large extent, been created by the increased cost of fuel, it was suggested that the most straightforward way of solving it would be to provide a fuel subsidy, as some other countries have done. This would have been a short-sighted approach. As your Lordships know, the Government's policy is to allow higher fuel costs, representing as they do a continuing burden on the economy, to work their way into the price structure. A fuel subsidy for fishing vessels would be inconsistent with this policy.

On the other hand, a general subsidy of the type which existed until 1973 would have been equally unsuitable in a situation where the need was for temporary aid for those sections of the fleet at greatest risk until costs and returns came into line. The section most at risk is, as I have explained, the deep-sea fleet. But, as a result of developing technology, many vessels previously regarded as inshore vessels fish in some grounds alongside the larger vessel of the traditional deep-sea fleet and market their fish in the same competitive situation.

The Government therefore decided, as will be seen from the Order now before the House, to bring within the scope of the Scheme all white fish and herring vessels of 40 feet and over in length. The vessels now within the scope of the Scheme account for 90 per cent. of our supplies of white fish and herring.

When the Government's intention to limit assistance in this way was announced, it understandably led to some criticism from the owners of smaller vessels and from shellfishermen. The Government fully understood their sense of disappointment, and the Parliamentary Under-Secretary of State for Scotland undertook that the scope of the Scheme should be reconsidered in the light of their views. This has been done most carefully and sympathetically, but we have concluded that the best interests of the fishing industry as a whole require that aid should be restricted to vessels of 40 feet and over. To extend the subsidy to vessels below 40 feet in length could be open to the objection implied in my remarks in relation to a general subsidy; that is, it would dissipate the available funds over a larger number of vessels rather than concentrating it where the structural risk was greatest. And in any case, we have no powers to subsidise shellfishing.

The full consideration of these representations delayed the making and laying of the Order, but I am sure the House will agree that it would have been wrong not to have given the fullest consideration to the representations that have been made. Subject to this, the Order was made and laid as quickly as possible.

The administration of the Scheme is simple and straightforward. One payment of the subsidy will be made as soon as possible after the end of the period, calculated by the simple process of multiplying the number of days fishing, provided that these exceed the qualifying minimum, by the appropriate daily rate. The Scheme runs only until the end of June. Naturally, there is interest, even anxiety, to learn the Government's intentions beyond that date. I regret that I am not in a position to discuss that today. My immediate concern is to secure the approval of your Lordships' House for the payment of this very necessary present measure of aid. My Lords, I beg to move.

Moved, That the White Fish and Herring Subsidies (United Kingdom) Scheme 1975, laid before the House on 6th May, be approved.—(Lord Lovell-Davis.)

6.43 p.m.

Lord CAMPBELL of CROY

My Lords, I am glad that on the first day after the Recess we are having this debate on the very serious problems of the fishing industry. We had a debate in the week before the Recess which I initiated, to which the noble Lord, Lord Strabolgi, replied and gave some helpful assurances, and we are grateful for the explanation which the noble Lord, Lord Lovell-Davis, has given us today about this Order. During the Recess there have been some further developments. The North-East Atlantic Fisheries Commission has completed its conference and issued quotas and, we understand from the reports, made other decisions.

The annual report of the Herring Industry Board has also been published. I would add that there has been a referendum in which the islands of Shetlands and the Western Isles differed from the rest of the country. I mention that because although fishing problems definitely intruded into the consideration there, they ought not to have done. It was deep concern about the future of the fishing industry there which played a prominent part and this was because the Scottish Nationalist Party—the SNP—had misled a large number of fishermen into thinking that these current difficulties were due to our membership of the EEC, which of course is quite wrong. There is one matter which is applicable to the EEC, but that is something that comes up in eight years' time and which is due to be adapted before then. Fortunately, many of the fishermen on the mainland were enlightened by their own leaders about these false stories—not all of them, but many of them, I am glad to say—so that the kind of result which appeared in the Western Isles and Shetland was not repeated there.

As regards the subsidy for the six months up to the end of this month, of course this is welcome to this side of the House. The criticism has been made that boats under 40 ft. are excluded, and the noble Lord will probably know that some fishermen in some areas have already themselves voluntarily subscribed to schemes to help the fishermen whose boats are under 40 ft. because they feel that in some cases their needs are even greater. I would ask the noble Lord, in considering the future, to bear in mind that the fishermen who are due to get the subsidy are themselves making arrangements so that some of it can be volunteered by them to their less fortunate friends.

Our question is, of course: what is to happen after 30th June? Presumably in this very serious crisis there will be a continuation of assistance of this kind. There are now many boats tied up or working for the oil industry, transferring away from fishing. The EEC countries have been giving a subsidy which is equivalent to an oil fuel subsidy, that is connected with the oil which the boats use, and I understand that it is to last a year, until June 1976. So presumably the Government are considering that as one possibility although they may not decide that it is appropriate. We would ask the Government to let us know soon. The noble Lord said that he could not make an announcement today, but having considered the various possibilities we ask the Government to let the fishing industry and those who are concerned about its vital interests know soon in what form the assistance will be continued in the future.

I will not go through all the current problems. As I mentioned, we had a debate three weeks ago and the points have also come up at Question Time in your Lordships' House. It is announced only today in the Press that the deep-sea industry has stated that more than 40 vessels have gone out of service in the last five months. That announcement was issued by the British Trawlers Federation, and another 36 vessels apparently went out of service during the course of last year. They attribute this mainly to cheap imports of fish. We know that, because of the American market being reduced, Iceland and Norway in particular have been selling greatly increased quantities of fish to us and at prices which the distant water fleet say they cannot compete with.

As the noble Lord said, for various reasons the fishing industry as a whole is facing a difficult time. For the herring fishermen it is nothing less than a crisis threatening their livelihood. Unless some further action is taken soon, the herring could become almost extinct in the seas round Britain within a few years. However, if the situation is caught in time, there is hope that the present stocks can multiply back into reasonable shoals again. British fishermen are greatly affected by the decimation of the herring, and Britain is now the country which could most suitably take a new initiative. Since the debate which I initiated, the North-East Atlantic Fisheries Commission ended its meeting and I welcome the reported agreement to stop industrial fishing which sweeps up immature herring for conversion into oil and fish meal. Agreement was also reached on strict quotas for herring, as I urged in that debate, but British fishermen are greatly restricted by the British quota in the quantity that they can now catch. Strict conservation is necessary, but the scope for British fishermen earning their living is greatly reduced by the arrangements which have been announced.

I would remind your Lordships that from 1970 to 1973 the inshore fishing industry enjoyed a period of increasing success and prosperity. Then they were struck by adversity for reasons unconnected with the EEC: for example, the steep increase in the price of fuel oil and the landing of cheap fish, which I have already mentioned. The larger deep-sea vessels have been fishing in more distant waters on their traditional grounds off Iceland, the Faroes and Northern Norway, thanks to agreements made by the British Government. It is clear, however, that the time limit for these is approaching. All concerned have been waiting for the Law of the Sea Conference to produce agreement on a 200-mile zone. In the meantime, it is questionable whether agreements on as favourable terms as those which have been concluded under which our fishermen are now fishing up to 12 miles off Iceland and the Faroes can be renewed, if in fact agreements at all can be made.

While the Law of the Sea Conference has shown that nearly all the nations of the world favour this new concept of a 200-mile zone, they are still a long way from signing an agreement upon it. The delay arises largely from matters other than fishing; such as the rights of free passage, and mining for minerals in the ocean floor beyond the Continental Shelf. Can we wait for such matters to be settled before making new arrangements for fishing? I doubt it, if we are to save the herring stocks, and the next meeting of the Law of the Sea Conference is not due to be held until next year.

Since it is now clear that what will eventually be agreed on a world basis is a 200-mile economic zone, should Britain not now seek a regional agreement on fishing only, which will conform with that expected 200-mile economic zone? It could be restricted to herring, if necessary, and not include other fish. Such an agreement would constitute a conservation, measure additional to those already agreed in the Atlantic Commission. Instead of only quotas, prohibited areas, and closed seasons, we could try to move towards the system of zones which we know is to be the system of the future. In international law, it would have the same basis as the quotas and the other conservation arrangements agreed regionally by the North-East Atlantic Commission. A similar agreement was made for trawl-free zones off Norway earlier this year between the affected countries, including Britain, and those also outside Norway's fishing limits; they are part of the international high seas.

Surely, future conservation agreements would be better based on a system consistent with what we know is to come; namely, a 200-mile economic zone. The countries affected would be those who were members of the North-East Atlantic Commission. Have the Government tried this possibility with the other members? I do not expect the noble Lord to be able to answer these questions tonight, but I put them because they are so important. Can the Government see this as a practical aim during the next few months?

My Lords, there is now a great danger of unilateral action in any case by certain countries, which could be forestalled by entry into negotiations designed to reach a regional agreement on new conservation agreements for fishing. Within the coastal State zone extending to 200 miles in the open seas, or to a median line, there would be an exclusive fishing zone reserved for the fishermen of that particular State. This might still be the present 12-mile limit, or an agreed increase to 20 miles or more. Negotiation on this inner zone is due to take place within the EEC well before 1983. It has been awaiting only the 200-mile zone to be sanctified in a world agreement. It cannot wait much longer. Further conservation measures are urgently required if the herring is to be allowed to multiply again. This is most urgent. The quotas on their own are not entirely satisfactory, because British fishermen and the British Government cannot be sure that they are being observed by other countries. The surviving herring are being caught by foreign vessels in waters near our coasts, though most of them I mentioned are not from the EEC countries.

I hope that your Lordships will have realised from my remarks that I am not proposing any kind of unilateral action by Britain. I am against that. Quite apart from the loss of confidence it would cause in Britain's reputation in the world, it would mean that we should probably lose more than we gained, because our distant-water fishermen, fishing for white fish off the shores of other countries, would probably be pushed out immediately in retaliation by those countries if we were to announce some zone, such as a 50-mile zone which some are pressing upon us. It might help the herring industry, but on balance it would probably cause more damage to other parts of our fishing fleet.

That is why a regional agreement of the kind I have suggested could be obtained and recognised by the rest of the world, which would be similar to the agreements on a regional basis which have already been reached on fish quotas and similar restrictions. Such an agreement would then be in the shape of what is clearly to be eventually agreed for the world at the Law of the Sea Conference—a system of zones and medians. In this way, Europe would be setting an example, leading the way without prejudicing the other issues being discussed at the Law of the Sea Conference, such as minerals in the Continental Shelf, navigation and pollution. So I would again urge that the crisis of the herring industry, apart from all the other problems faced by the fishing industry in this country, should be treated by the Government as urgent and given immediate attention. I hope that the proposals I have made will be considered.

Lord LLOYD of KILGERRAN

My Lords, may I add two brief points? First, may I thank the noble Lord the Minister for the clear and lucid way in which he approached the matter, and for the sympathetic approach he has made to the crisis conditions in the industry. Secondly, may I emphasise that the rate of rundown of the fishing fleet has been very great indeed in recent months. This is bound to lead to greater shortages and to higher prices in the very near future. Of course, the subsidy is welcome, but we are now in a crisis position in relation to this fishing fleet.

Therefore, I should like to ask the Government, now that we are to remain in the EEC, whether they will sympathetically consider that after the end of this month, when the subsidy comes to an end, in accordance with other countries in the EEC, a subsidy in relation to the consumption of oil can be given, and thus widen the scope of this subsidy? As the noble Lord, Lord Campbell of Croy, has said, there are many in this industry who feel the limitation for subsidy to ships of 40 ft. is unfair to some with ships of a lesser size. It may be that the Government will consider that the attitude of some of the EEC countries in giving grants in relation to the consumption of fuel is fair and just.

6.57 p.m.

Viscount BROOKEBOROUGH

My Lords, I should like to welcome the flexibility and ingenuity of the Government in managing to provide some form of subsidy to those ships which are also dealing with prawns and shellfish. It is very welcome to a very large industry in Northern Ireland, and is a very good example of a flexible Government approach. I should like to support my noble friend Lord Campbell of Croy in expressing absolute alarm about the future of the herring industry. Certainly, people in my part of the world are afraid that there is no time to save the stock. The facts of the matter are that at the moment we operate conservation methods within our 12-mile limit. The herring spawn especially off the Isle of Man and then go into other waters where they are duly captured by the fleets of other countries. They are taken and our stock is reduced. I am told that although the quota for next year goes down from 150,000 tons to 66,000 tons, there is little hope of our fishing boats managing to catch that amount of the quota.

My Lords, I wonder whether we have time to carry out negotiations with countries throughout the world. Although my noble friend said that unilateral action would do an immense amount of damage overall, I think the future of the industry will not allow us to go ahead with the long and prolonged negotiations which exist, and must exist, in order to get Russia, Poland and Norway—all sorts of countries which are not within our orbit so far as policing or conservation methods are concerned—to agree. I feel our own fishermen believe that so many of our conservation methods prevent them from catching fish, and allow people from other countries who are not interested in our conservation to continue to make a living. The future lies not in the continuation of subsidies, but in conservation.

I feel we must convince our own fishermen that our own Government are determined to see the conservation of the herring stock, which has traditionally been such a major element in our food supplies, continue. I should like to feel that in the very near future the Government will announce the continuation in the short term of the subsidy, and at the same time say that they will pursue with maximum vigour the conservation of the stocks off the West Coast of Scotland and in the Irish Sea, an area in which I have a special interest. Time is not on our side. International agreements always appear to take time. Maybe we may have to think of unilateral action in conjunction with the Irish Government in the Irish Sea, and off the West Coast of Scotland.

7.0 p.m.

Lord LOVELL-DAVIS

My Lords, I will endeavour to answer as many as I possibly can of the points noble Lords have raised. I feel as though I have been subjected to a hail of grapeshot. The noble Lord, Lord Campbell of Croy, referred early in his speech to the matter of the Scots' offer, and it is true, of course, that the Scottish fishermen did offer some of their aid to provide something for those excluded but a similar offer was not made by the England and Wales section, and the offer would be quite outside the statutory Scheme. As the noble Lord knows, no doubt, the Parliamentary Under-Secretary of State for Scotland is pursuing this matter on a voluntary basis with the Scottish fishery representative bodies.

The noble Lord also asked what would happen after 30th June. The aid was introduced essentially as a temporary measure to help the industry to adjust in an orderly fashion to the changing situation. The Government will consider successor arrangements, if any, in the light of circumstances prevailing, and an announcement will be made as soon as possible. Reference was made to the fuel subsidy by both the noble Lord, Lord Campbell, and the noble Lord, Lord Lloyd of Kilgerran. I have explained already why this gells or does not gell with the Government's policy vis-à-vis increased fuel prices. The Commission have extended the period during which fuel subsidies may be paid. They decided to extend the period from the end of June 1975 to the end of December 1975, and the Council took note of this at their meeting on 28th and 29th April. As I said, the Government's policy is that higher fuel costs should be allowed to work their way through the system. Nevertheless, if other Member-States chose to take advantage of the latest decision by the Commission there could be some distortion of competition. The situation will be kept under review, but it is too early yet to say whether the United Kingdom will pay a subsidy in the second half of 1975.

The matter of cheap imports obtained from Norway and Iceland is obviously significant, but I think the noble Lord will agree that this is a world problem; it is not limited to our own fishing industry. Although this aspect plays its part it is not all that significant a part. The herring crisis is a tremendously important matter, and the Government are well aware of the importance of preserving herring fishing. It is a desperate situation which, as the noble Lord, Lord Campbell, pointed out, has arisen primarily because of over-fishing by the industrial fisheries, and it has left the herring stocks around our shores in a very bad state. The North-East Atlantic Fisheries Commission have reached agreement on a greatly reduced total of international catch and quotas of both North Sea herring stocks and West of Scotland herring, and the United Kingdom has secured a fair quota allocation. These agreements, together with a ban on industrial fishing for herring, could go a long way towards protecting the herring stocks; but more protection is necessary and the Government are pressing strongly for further conservation action.

A ban on herring fishing would, of course, be very difficult to negotiate, but we have to resolve the problem. I quite agree with the noble Lord when he says, with regard to unilateral action, that we cannot take this course; there would almost certainly be retaliation to it. The Government's approach to this whole matter is one of working towards solution of the problems through regional and international negotiation and agreement. The noble Lord, Lord Lloyd of Kilgerran, referred to the rundown of the fleet. I am not sure whether it was he or the noble Lord, Lord Campbell, who referred to the number of ships.

Lord CAMPBELL of CROY

My Lords, I referred to a report in the Press today.

Lord LOVELL-DAVIS

My Lords, one should not lose sight of the fact that vessels do go out of service for a variety of reasons, servicing and so on; I think this ought to be taken into account. The noble Lord, Lord Lloyd, raised a further point about the limitation to vessels of 40 feet. Aid was given to avoid the development of a serious structural situation which could endanger food supplies. This situation is not apparent in the case of shellfish and with coastal vessels of less than 40 feet in length. Vessels accounting for over 90 per cent. of white fish and herring landings are covered by this Scheme. I think we must all agree that shellfish are, after all, a luxury item of diet in all social classes. Were we to extend the subsidy to smaller vessels we should be faced with very substantial payments. Approximately 4,200 vessels of under 40 feet known to fish regularly are excluded from the present subsidy. The figure includes shellfishing vessels, but many of the smaller vessels fish for both white fish and shellfish, and a fairly realistic guess would be that for every £1 per day paid in subsidy to these vessels the Exchequer would be paying something like £168,000 a half year.

I have one final point—I am sorry if I have missed other points raised during this short debate—concerning the reason for our herring quota shares being so small. Well, they are not so small. The quotas are worked out on the basis of historic performance in the fishery, with allowances for coastal States and States with special needs, and our quotas are broadly in line with our percentage share of the fisheries. In the interests of conservation, sacrifices must be made by all countries, and these sacrifices are reflected in the quotas. My Lords, I hope I have covered the main points that have been raised.

On Question, Motion agreed to.