Agricultural Marketing Bill

HL Deb 24 January 1983 vol 438 cc59-92

6.17 p.m.

The Minister of State, Ministry of Agriculture, Fisheries and Food (Earl Ferrers)

My Lords, I beg to move that the Bill be read a second time. I am glad to see that the Bill is to be the vehicle by which the noble Lord, Lord Northbourne, will make his maiden speech, and we much look forward to hearing what he has to say. The Bill represents the culmination of a lengthy and constructive debate which has taken place within the agricultural and food industries in recent years, on the importance of improving the marketing of our produce—both on our own market and abroad. The Bill seeks to establish the framework within which improvements in marketing can take place.

Among our producers and manufacturers there has been a growing recognition that it is no longer enough simply to be efficient at producing. Production is not an end in itself. If the product does not sell, then the producer, the processor, the retailer—none of them will be rewarded. They are all interdependent upon one another.

The record of agricultural productivity in this country is one of considerable achievement. Our food industry, as well, has achieved a high degree of efficiency, and the efficiency of our food distribution trade is second to none. But we cannot stand still. Industries in other countries are also highly efficient. and they are looking to an expansion of their markets. The free exchange of agricultural produce within the Community, the advances of modern technology which allow rapid transport of perishable foods which never used to happen in the past, and the increasing sophistication of consumer demand for food—all those factors mean that even greater account must be taken of what the market wants. That means producing exactly the type of produce which is demanded by the market. It means making sure that the quality product gets the reputation which it deserves, and it means that the consumer must be made aware of its availability, of its reliability, and of its value for money.

To achieve that requires very effective communication between the industry on the one hand and the consumer on the other. That means co-operation between producers, processors, wholesalers. manufacturers, distributors and retailers—all those who are links in the chain from the producer to the consumer.

We have already seen a number of initiatives being taken to improve the marketing of our home-grown produce. The Kingdom Cox campaign set out to improve the grading and the organisation of apple supplies. It has achieved substantially higher sales of the English Cox apple. The Charter Bacon Scheme aims to achieve quality and consistency of supply of British bacon. The "Great Brits" promotion of premium grade potatoes is beginning to prove its worth in its test market in Scotland.

Among the many initiatives which have been helped by the Central Council for Agricultural and Horticultural Co-operation, we have seen: the launch of Puffin new potatoes; Froqual frozen vegetables; the first appearance of British frozen lamb to help producers extend the marketing season for home-produced lamb; the remarkable achievement of Grampian Pig Producers in creating new markets for their produce in close collaboration with the trade; and the promotion of English fresh vegetables in West Germany.

In November last year, we saw what an impact could be made at the major French food fair, SIAL, by the co-ordinated efforts of a number of fresh produce sectors—milk, meat and vegetables—working in conjunction with the British Food Export Council to present a showcase of high quality British food products. It was an impressive achievement.

All these activities indicate a willingness on the part of producers and manufacturers to pool their efforts to achieve better results on the market. But, unlike our European counterparts, no single body exists in this country to bring together marketing expertise across a number of sectors in joint initiatives. The Central Council for Agricultural and Horticultural Cooperation has done wonderful work in encouraging better marketing in the co-operative sector, but its scope, as its name implies, has necessarily been limited to co-operatives alone, and therefore to basic agricultural and horticultural produce.

The United Kingdom is one of the last of the major food-producing countries to seek to organise itself in this sphere. In France, there is SOPEXA; in Germany, the CMA; and the Danes, the Dutch and the Italians all have their own organisations aimed at improving the co-ordination of marketing efforts at home and abroad. In this, Britain lags behind. I hope that the Bill now before the House will remedy that position.

Following much discussion within the agriculture and food industry, the Government are proposing in this Bill to establish a central marketing organisation for agriculture and food which has as its objective the improvement of the marketing of our food and agricultural produce—both at home and abroad. We propose to call the new organisation Food from Britain. Our intention is to build Food from Britain on the basis of the existing Central Council for Agricultural and Horticultural Co-operation, and therefore to develop fully the marketing expertise which the Central Council has acquired over the years. But Food from Britain's remit will go much wider than that of the Central Council. It will bring together in a single forum all parts of the agricultural and food industries to work towards the common objective of improving our marketing performance.

In the long run, we see Food from Britain as an industry organisation, run and financed by the industry which it serves. But the Government recognise the importance of giving Food from Britain an effective start. We intend, therefore, to see the organisation properly financed from the outset on a scale sufficient to launch it on a proper basis. The Government will provide pump-priming funds for the first five years, in order to help Food from Britain establish itself and reach full operation. In total, up to £14 million will be made available in the period 1983–84 to 1987–88 inclusive for new marketing initiatives. The money will be paid as grant-in-aid.

The support of the food and agriculture industries is crucial to the success of this venture. The Government will be financing the greater part of Food from Britain's marketing budget at the outset, but the Government's contribution will reduce as these industries contribute on increasing scale. Industry contributions will be voluntary, by such means as subscriptions, contributions to joint projects, and payments for services. By the end of the five-year period, we envisage that the full marketing budget of Food from Britain will be provided by industry. The success of Food from Britain will depend on its ability to convince the agriculture and food industries that its services are worthwhile. And this is as it should be.

Food from Britain will continue to support and to encourage co-operative development in exactly the same way as the Central Council for Agricultural and Horticultural Co-operation now does. The Government financial support for co-operative activities will continue, as now, at a rate of some £1½ million per year, and co-operative grants which now total about £3 million to £4 million per year will also continue unchanged. Nothing in the Bill which is now before the House in any way diminishes the commitment of the Government to the co-operative sector. Indeed. we believe that co-operatives will stand to gain from the bringing together of marketing and co-operative development within a single new organisation.

Perhaps I may refer briefly to the provisions of the Bill. Clause 1, together with Schedule 1, sets up Food from Britain and gives it a council of 13 to 15 members. The Government are proposing a small, effective council for Food from Britain because it will be concerned with marketing throughout the food chain. A body which consisted of representatives of every sector and region would, in our view, be too large to work effectively. In making their appointments to the council, the agriculture Ministers will have regard to all sectors of the food and agricultural industry throughout the United Kingdom.

Clause 2 transfers to Food from Britain the present functions of the Central Council, which are to improve and develop co-operation. The details of these functions remain enshrined in the Agriculture Act 1967 and in no way have been changed or diminished. It also gives Food from Britain powers to co-ordinate and to develop marketing in the widest sense in the areas of agriculture, horticulture, fish (other than fresh sea fish, which is dealt with by the Sea Fish Industry Authority) and food produce. The powers are deliberately given wide definition so that Food from Britain has maximum scope to develop and implement a flexible strategy. We hope, therefore, that in time Food from Britain will co-ordinate market research; act as a forum to achieve more coherent marketing within and between sectors; encourage better quality and presentation of produce; promote joint ventures; provide advice and information; and, above all, concentrate upon the priorities of quality, consistency and value for money.

Clause 3, with Schedule 2, provides for the dissolution of the Central Council for Agricultural and Horticultural Co-operation, and for the transfer of all its rights, obligations and property to Food from Britain. Clause 4 enables statutory bodies in the agricultural field to contribute towards the cost of the marketing activities of Food from Britain, if they so wish. Clause 5 lays down standard requirements which apply to any non-Crown body for accounting records and preparation of an annual report. Clause 6 gives Food from Britain powers to borrow temporarily up to £500,000, a provision which is intended to cover short-term cash flow problems only. The clause also enables Food from Britain to make grants or loans.

Clause 7 will enable Ministers to make grants and loans to Food from Britain and to remunerate the members of the council as appropriate. I should add that funding by the Government of co-operative functions will continue to be provided for in Section 58(9) of the Agriculture Act 1967. Clause 8 deals with the interpretation of various terms used in the Bill. Clause 9 names the Act, provides for it to cover Northern Ireland and provides for repeals in Schedule 3 which are mainly consequential on the transformation of the Central Council for Agricultural and Horticultural Co-operation. The clause also makes provision for the coming into force of the Bill by statutory instrument. It is intended to do this two weeks after the Bill receives Royal Assent, in order to set Food from Britain in full operation as soon as possible.

I very much hope that the Bill will receive the support of your Lordships. It reflects the Government's view that there is a very great deal to achieve in the better marketing of our food and agricultural products—an achievement which will be available for the producer, the manufacturer, the retailer and the consumer. It demonstrates our belief that British produce can develop overseas markets and can achieve a reputation for quality, variety and consistency of supply for which it should be well noted. Food from Britain can provide the framework by which this can be done and the results will be a stronger and more effective marketing performance by our industry in the coming years. I beg to move that the Bill be now read a second time.

Moved, That the Bill be now read a second time—(Earl Ferrers.)

6.30 p.m.

Lord John-Mackie

My Lords, in opening for the Opposition on this Bill, I too should like to say that we are looking forward to hearing the maiden speech of the noble Lord, Lord Northbourne. The noble Lord, like his father, is looking to the land. His father not only looked to the land but wrote about it. He was also a very prominent member of the agricultural war committee in his native county. We look forward to hearing from the noble Lord and for his experience to be made available to this House.

The noble Earl, Lord Ferrers, in his usual crisp and clear way, has put forward the reasons for the Bill. He has gone over the whole gamut of what is there now and has put it to us that the co-ordination of all these functions is the main object of this bill. I could not agree with him more. I welcome the Bill although it has taken a long time to reach this stage. The Minister admits that he started looking at this matter in 1979, and by about the middle of that year he brought together four or five people to study the situation. Now here we are, three weeks into 1983, having it launched. The Bill should be good with all the deliberations that have gone on in that time.

There were inklings of it at the Oxford farming conference in 1981 when one of the Minister's advisers, Miss Detta O'Cathain, gave an excellent paper. We all thought that the Bill would be coming fairly soon. That was two years ago and the Bill is not yet on the statute book. The problem with the designated committee which we have at the present moment is that it is running into spots of trouble. I shall not mention them. I do not think that a director has been appointed yet. Some members of the NFU are making criticisms. I trust that will be sorted out before 16th February, when we are to meet on the launching of this Bill.

Looking at the Bill, we see that it gives power to the Food from Britain organisation to develop and coordinate the marketing of agricultural and food produce at home and abroad and to take over the Central Council for Agricultural and Horticultural Co-operation. Having seen that body (the CCAHC) on to the statute book as a junior Minister in 1967, I am glad to see that the Minister of State in another place, in the Second Reading speech there of this Bill, envisages a strong role for it under an almost autonomous body, so far as one can gather from what he said, called a co-operative development board with its own chairman from the main council. I welcome this very much because it is essential to make full use of all the expertise of the CCAHC.

The other point on which the Minister is to be congratulated is on not having nominated or statutory members. I have been a member of, and chaired, many bodies that had statutory members. There is no doubt that many are very good; but too often it is just "Buggins' turn" from the parent body. One usually gets a number of people who are just simply filling in a space. I think that it is an excellent idea that there is to be no nomination of statutory people on this body. The Scottish NFU wants more consultation, but that should be all. I doubt whether Douglas Cargill, the chairman-designate, would have obtained the job if he had been a nominee of the NFU, although they consider him a good choice. He has great experience in co-operatives in the North-East of Scotland. He is a founder member of Grampian Pig Producers, a body which took over when the bacon factory closed down in Aberdeen. That has been a huge success. He is a past chairman of Grampian Growers, a body that deals with a tremendous amount of bulbs, flowers, potatoes, and so on from that area. That would make him, as the Minister of State suggests, a first-class chairman of the development board, the successor to the CCAHC, within the Food from Britain organisation. This should satisfy many of my noble friends who are worried about the position of the council. Mr. Cargill happens to be a cousin of my wife. which I would suggest is a recommendation as well.

My noble friend Lord Blease, because of commitments in Northern Ireland, is unable to be here today but hopes to take part in other stages of the Bill. In a note to me he states that in general terms the Bill is welcomed by the Ulster farming community. It is hoped that the already well-developed agricultural marketing provisions in the Province will be further improved and strengthened by the Food from Britain measure. However, apart from the vital questions concerning effective liaison and Northern Ireland representation on a new Food from Britain Council, other important matters regarding Northern Ireland agricultural interests require to be clarified. For example: will Northern Ireland food producers still be able to market Ulster butter, milk, bacon, eggs, potatoes or other agricultural products under their own labels where these are well established, or will all these become swallowed up in the proposed new marketing operation? I hope that when the noble Earl comes to reply he will be able to assure my noble friend Lord Blease that the latter is not the case.

Now let me make a few points about the present situation. We are producing today at farm gate prices over £10,000 million worth of temperate foods. This is about 75 per cent. of our needs. So over £3,000 million more has to be produced to become self-sufficient. I shall not attempt to forecast whether this can be done; but when one remembers that in the mid-1960s we were producing only 13 million tonnes of grain, and today we are well on our way to producing 23 million tonnes, one wonders how much food we can produce in this country if we carry on at that increase. However, we export round about £3,400 million worth of food and drink, of which only about £2,200 million is food. There is an enormous export of Scotch whisky which takes about £900 million of the main figure. All that food has to be replaced by buying food over and above the 25 per cent. shortfall that I have just mentioned. Although the Food from Britain campaign is pushing home-produced food, it is getting considerable publicity in that it has to sell a lot more abroad. It has to be remembered that the more we sell abroad, the more we have to buy to bring up our supplies to satisfy 100 per cent. needs.

According to the noble Lord's Ministry, from which I received some figures, more than 50 per cent. of the cost of food to the consumer is in processing, packing, distribution, retailing, et cetera. So we are really speaking of about £1,000 million worth of food at farm gate prices, or maybe slightly less than that which is to be exported. This means that nine-tenths of food production is sold at home. Even suppose Food from Britain succeeds in doubling our exports, it still means that far the biggest job that it will have to do will be to market the home sales of £8,000 to £9,000 million worth. I note that the Bill does put home food first and export afterwards.

I gather from the Food Processors' Federation that more than 50 per cent.—and it is a very high figure which I was unwilling to believe when I heard it—of home-produced food reaches the consumer in processed form. This puts 50 per cent. more on to the price before it reaches the consumer. That is called "added value". I have always been suspicious of that expression because I feel it is often only added expense. If one takes potatoes, for example, I have looked at potatoes which are sold in the supermarket, nicely washed and in a polythene bag, and then I have gone and brought 561bs. in a paper bag fresh off the farm. You will find that if you take the 2 cwt. plus that each individual in Britain eats in a year, they are paying to have them washed and put into polythene bags, and it comes to £7 or £8 more. Of course I know that potatoes are not always sold in that way. Root vegetables in particular do not keep so well after they are washed, and I think that we should be teaching housewives to buy them, as far as possible, in the state in which they come off the farm. The point I am really emphasising is that if Food from Britain is to give real help to home producers, then they have to concentrate on what is sold at home. I appreciate that consumers, processors and, of course, the economy come into the picture as well but, as the noble Earl said, none of these will benefit unless the production is there.

Over 50 years ago, in the very early 'thirties, I was often frustrated by not being able to sell my produce. I had printed some notepaper with a heading, which also appeared on the back of the envelope: "Buy British Farm Produce". That was in very large print. Some people wrote and asked whether there was a body they could join; a lot of people laughed at me, and nobody wrote wanting to buy anything; but I felt I might be sowing a seed that could germinate some day. Therefore I am only too pleased to support this Bill. It may help to answer my plea which was made over 50 years ago.

6.42 p.m.

Lord Tanlaw

My Lords, I should like to thank the noble Earl, Lord Ferrers, for his presention of this Bill which will, we hope, become a very useful one. Like the noble Lord, Lord John-Mackie, and the noble Earl, I am looking forward very much to the maiden speech of the noble Lord, Lord Northbourne, and to hearing his expertise on this subject. My noble friend Lord Mackie of Benshie is unable to be present today but I know he would be particularly interested to take up the point which was made by the noble Lord, Lord John-Mackie, about potatoes. I have no doubt he was right in what he said, although my own technical knowledge of that subject is small.

It is said sometimes that quangos come and quangos go; that there are good quangos and had quangos; and there are some that change their spots. The latter kind is what we have in this Bill—one that changes its spots. The Central Council for Agricultural and Horticultural Co-operation changes into Food from Britain. It is also true to say that this transformation has provided "teeth" for the first time for the council. In Clause 2 of the Bill, the functions of the central council are not only transferred but given extra powers in that Food from Britain may undertake activities to develop and co-ordinate the marketing of agriculture and food produce. It is this part of the Bill that I welcome very greatly and have great hopes for, along the lines which were explained by the noble Earl in his presentation of the Bill this evening.

If there is any criticism, or clarification to be made by the noble Earl in his winding-up speech, I would hope that not too much emphasis is put on promotion. in the terms that he has described. Of course it is essential, if it is to be a successful marketing operation, but not promotion without the proper guarantees of quality control and really positive attempts by the Government or by the Food from Britain Council to establish criteria and quality which are agreed with the distributors and the markets as a whole and which will ultimately benefit the consumer. I think this is a very important and significant Bill for producers, like myself—if I may take this opportunity to declare my interest as a producer of Scottish beef and hill lamb.

It is very important that Food from Britain has clearly stated objectives, which at the moment I am not clear about, but no doubt they will emerge during the Committee stage. Both as regards home and overseas markets, these objectives should he defined and should include the quality standards which I have mentioned. These must be maintained and fulfilled before Food from Britain will go as far as promoting it. I feel that a blanket promotion simply to promote food which is produced in Britain could do considerable harm to the producers in this country, especially if bad food came under the umbrella of this marketing procedure.

There is no need for me to remind the House. as has the noble Earl, of the success of some marketing programmes. The noble Earl mentioned the British ones, but there are also successful imported ones, and we have been on the receiving end of those. There have been campaigns for New Zealand lamb and Danish bacon. The point I wish to make here concerns the maintenance of recognised standards of quality which they adhere to, and the consistency of the product. If we do not learn from their experience, I am afraid we are going to fail. Tonight I am only interested in talking about Scottish beef; but whether it is apples, lamb or anything else, if we do not stick to these points, I have a feeling that there will he great disappointment from everyone connected with this project.

The only aspect I should like to select this evening is just one example of the many areas in which Food from Britain is going to assist in terms of marketing and which will, I hope, benefit from the new powers given in Clause 2 of the Bill. It is, of course, the need to improve production of beef—in this particular case, Scottish beef—in much the same way as improvements in quality have affected the pig trade in, for example, the reduction of back fat over the last 20 years.

I am sure that your Lordships will forgive me if I say—many of you will be experts in this matter—that there are different types of beef. I may say that Scottish beef is basically a suckler beef which takes 18 to 20 months to produce from cows and calves fed on nothing but grass. Then there is barley beef, on the other hand, which means that the animals are intensely fed indoors and receive little exercise to speak of in order to maximise the increase in weight. That kind of beef is produced in only 12 months. Then there is English beef which is calved on the dairy farms and is fed on a mixture of grass, cake and milk.

So there are three different types of beef which, possibly, I have described very badly; but when it comes to marketing, the housewife does not have much indentification as to the feeding patterns of the meat she is buying from the butcher. I should like to make the point, because of my declared interest, that those of us who work the most difficult parts of Britain— in the hill and upland areas—have beef which takes 18 to 20 months to mature. On the other hand, they are getting the finest diet, a natural diet of grass. There is no forced feeding or unnecessary fat; but we do not get any extra price for this quality. I mention this because another report, which has been brought out by the Royal College of Physicians, says that fat meat is bad for us. I hope to develop this point during the debate which my noble friend will introduce into your Lordships' House next month.

The point I am making is that the three different types of beef are not classified. There is no definition of "Scottish beef". We know it is the best and finest in the world, and yet there is no definition of it so that we can, as a co-operative of producers, maintain the standards to get a better price in the markets.

I also draw the attention of the noble Earl to the report of the West of Scotland Agricultural College, entitled Auction Markets: Fat Cattle Sales. It is the No. 3 Report. This is an area in regard to which they have said, quite clearly, that the auction markets do not have any grading system for those of us who produce beef. They say that it is quite possible for the auction markets to make a grading on visual grounds alone, between over-fat animals and those of lean and good consistency, and also between those which have been fed on grass and those which have been fed on barley. They say that this would be beneficial for the market, but I am not sure whether it would for the buyers, because, at the moment, the heavier the carcase the bigger the price. So there is no incentive for the producers of beef to concentrate on quality beef.

I hope that this is a factor which will be taken into account in this new Bill and in these new powers that are available. The information is available—certainly, if we talk in terms of Scottish beef—and I have a feeling that now, for the first time, this can actually be implemented. One of the reasons why it has not been implemented before is this: Why should the auctioneers carry the burden and trouble of the extra cost of grading? But there are funds now available to put this right.

I think also that, for instance, there should be a marking on the carcase of Scottish beef calves for slaughter, which would indicate to the end-consumer that it is beef that has been grown on grass, rather than on barley, or that there should be a quality label attached to it. The new Food from Britain organisation could do a lot to educate butchers. Why do the butchers not clearly indicate on the meat on their counters that which is grown from grass, that which is grown from barley or that which is force-fed? I believe that people would be willing to pay extra for quality and they want to know. The quality is made quite clear in other products.

I also believe that producers' co-operatives should begin to be formed. Those of us who work on hill farms should co-operate together, in order to produce the kind of animal that is wanted for the market. It is the only business of which I know where we are working together to produce for the market, but have no idea what the market wants. Very roughly, we take our chance on the mood of the buyers on the day. The objectives behind, and definition of, the beast that we are trying to produce are not before us.

These are just some of the points that I hope will be taken into consideration by the Government. I am not asking them to do all the work on this. I am asking them to give some real incentives to the markets, to those of us who produce and to the breeders to fulfil the objectives which the noble Earl has put forward. On the other side of the coin, if support is not forthcoming—I have given the example of the Scottish beef campaign—if the Government are not, in the next five years, going to assist auctioneers and auction markets in. for example, Scotland, to improve the quality and grade the stock that is coming up for sale, and if they are not going to have representation on the Food from Britain board, or board of directors or whatever they will have, by men who are competent to put forward the ideas that I have expressed, of maintaining the quality and the name of Scottish beef, then it will be a tragedy.

Certainly, there will be no support whatsoever from the industry to pay a penny towards any organisation that does not do the least of the things which I have described. I have no doubt that, when he replies, the noble Earl will say, "Of course this is something that is bound to happen". If so, the industry, whether it be the producers, the meat buyers or the butchers, will welcome this Bill and will be happy to support something which is in their interests, right down the line from the producer to the consumer.

6.55 p.m.

Lord Northbourne

My Lords, I must ask your Lordships' indulgence for my maiden speech. I should like to thank you for the kind welcome which you have already given me and I should particularly like to thank the noble Lord, Lord John-Mackie, for the very kind remarks that he made about my father. As the son of a distinguished farming father, I am rather proud to be able to make my first speech in your Lordships' House on an agricultural subject. I have to declare an interest, in that I am the managing director of a substantial farming business and our most important activity is growing, packing and marketing vegetables.

The need for this Bill is emphasised by the existence of a world surplus of almost all major agricultural commodities. British food production is increasing and British food consumption is static. It is, perhaps, interesting that the French housewife spends a much higher proportion of her income on food than her British counterpart. I have personally been able to avoid any inconvenience on this score by marrying a French wife, but the problem for the industry obviously remains.

I should like to touch on the matter of co-operatives in agricultural marketing. I know that the subject has been discussed at some length in another place. My remarks are not related to any kind of political view, but only to my own personal experience. I am a member of three agricultural co-operatives connected with marketing and for 10 years I was a director of one of them. My experience suggests that, although cooperatives have a very important role to play, they also have their limitations.

The success of a co-operative depends on the loyal support of its members, and members look to the cooperative to offer them a service. The very essence of good marketing is strict control of quality and regularity of supply, and the members of a cooperative are sometimes reluctant to accept the necessary disciplines for a fully effective marketing effort. For this reason, I believe it is difficult for a co-operative to have quite the same sharp, commercial cutting edge as an independent business which markets its own products.

I particularly welcome the fact that the whole food chain, and not just agricultural and horticultural produce, is covered by the provisions of this Bill. Unfortunately, traditionally, agriculture and the food industry have tended to develop along separate lines and, sometimes, in competition with one another.

In 1977, I was responsible for instigating a seminar at the Centre for European Agricultural Studies at Wye, which was entitled Europe as a Food Exporter. The main conclusion which came out of that seminar—and I believe it is equally true today and equally true for Britain—was that the greatest opportunities for increasing the export of agricultural and horticultural produce lie in the export of processed and prepared food.

It is interesting to reflect that 100 years ago nearly all food was prepared either on the farm or in the kitchen. By contrast, today the vast majority of the food that we eat is factory processed. One noble Lord mentioned 50 per cent., but I suspect that even more than that is either processed or at least graded and packed. Noble Lords, who may recently have tried, for example, to buy an apple in a supermarket, may have been confronted by the problem that they had to buy four of them in a plastic tray, with a bit of plastic wrapping over them. I think that the noble Lord, Lord John-Mackie, had the same problem with his potatoes.

Today, the supply of raw materials for the food industry is one of the principal roles of the agricultural and horticultural industries, and the food industry can offer us new and useful outlets for our products. Indeed, not all such ideas are new. For example, I ask your Lordships once again to consider the humble potato which, when it is dressed up in fancy dress, sells as potato crisps to an enormous market. It has developed a major new outlet for potato producers. Similarly, I have always greatly admired the genius of the man who thought of taking anchovy and making it into Gentleman's Relish—and even giving it a Latin sub-title for good measure.

A great deal of what can be said about the Bill has already been said, and I therefore intend to be very brief. I should like finally to refer to Clause 8, which defines a number of terms used in the Bill but does not actually define the term "marketing". I suggest that marketing must not be seen just as packaging and promotion, although both have a part to play. The noble Lord, Lord Tanlaw, made this point. It simply is not good enough to shout "Buy British" if the product is not right or if the price is not right.

I suggest that good marketing is identifying specific products which the consumer wants, or which the consumer would want if they were available, then learning how to produce them at the right price and how to deliver them where they are wanted and when they are wanted, and to a reliable standard of quality, and only then making sure, through promotion, that the customer knows that the product is available. That is the kind of co-ordinated marketing which I hope Food from Britain will bring to the industry. If it succeeds, then an increasing number of customers will choose to buy British.

7.2 p.m.

Lord Sainsbury

My Lords, I consider it to be a privilege and a very great pleasure to be the first to congratulate the noble Lord, Lord Northbourne, on his excellent maiden speech. I am sure I speak for all quarters of the House when I say that, with his experience as a large producer and with his keen marketing sense, we all look forward to his future contributions when he speaks on agriculture and allied problems.

In welcoming the Agricultural Marketing Bill and congratulating the Minister of Agriculture, Fisheries and Food upon his initiative, I must of course declare an interest, since the firm with which my name is associated is obviously concerned. Also, one of my kinsmen was one of the five marketeers who were asked to assist the Ministry and the Government by examining the problems of the marketing of British agriculture and food products. We have in the United Kingdom food producers who compare favourably in efficiency with any in the world, but we have been less efficient in marketing. We have not always taken into sufficient consideration consumer choice and demand, probably because of the emphasis placed on price guarantees under the common agricultural policy, which has led farmers to concentrate upon securing volume of output.

What is good marketing? In my opinion, it is ensuring, first, as has already been stated, a high quality product with continuity of supply, properly graded, in good condition and packed in suitable containers—deciding whether the market requires a consumer pack or a bulk pack. There is a clear need to establish a realistic, commercially viable specification, and, if standards are established, they must be properly enforced. Retailers have, in the past, found that this is not always done satisfactorily. It is vital that the consumer does not lose confidence in the product.

Good marketing is not simply a public relations job of inventing a brand name and spending a large sum of money on television—although, of course, advertising has a role to play. There is obviously a need for an organisation that has the power to co-ordinate marketing efforts, such as the French and the Germans have. There is equally obviously a need to co-ordinate market research. In the export field, in my opinion, it is particularly important to make a study in depth of the market you want to penetrate before you start exporting there—something in which, in the manufacturing industries, the Japanese have excelled.

A very small proportion of the agricultural product that leaves the farm reaches the consumer in the state in which it left the farm gate. There are many links in the chain between the farm gate and the consumer's shopping basket. To take two obvious examples, milk is collected from the farm in tankers, pasteurised, bottled and delivered by the milkman to the housewife's doorstep. Peas may be grown under contract and, after harvesting, delivered to factories for freezing, canning or drying before they reach the wholesaler and retailer. It is probably true that there has been less co-operation and communication between the links in the chain of distribution in Britain than there has been with some of our overseas suppliers. The new organisation will have an important role to play in encouraging the dissemination of market information.

One of the great difficulties in marketing is predicting accurately future demand. Here the large retailer is in a good position from his experience to provide forecasts from which the producer can benefit as much as anybody. Of course it has always been easier for countries like Denmark, Holland and New Zealand to maintain high quality standards because such a large proportion of their total production went in export, and strict quality control could be exercised both at packing stations and at the point of shipment. Also, whereas we have been pioneers of co-operation in the retail field, until comparatively recently we have not developed on any great scale the producer marketing co-operatives. This is the exact opposite of what happened in the three countries I have just mentioned where producer co-operation brought the necessary discipline which is essential for good marketing.

An example of a comparatively recent successful marketing co-operative in the United Kingdom is the East Lincolnshire Growers, which was formed in 1964. Its 36 members range from a rather small farm of 150 acres to a very large one of 7,500 acres. All their root and vegetable crops are marketed through the co-operative. They have learnt to grow for the market and their current turnover is, I understand, some £7 million a year. This is a real success story. The promotion of producer marketing co-operatives was no doubt given impetus by the formation in 1967 of the Central Council for Agricultural and Horticultural Co-operation. It is to be welcomed that the Bill transfers the functions of the council to the Food from Britain organisation.

There is one other matter in the Bill on which I should like to comment in the light of my experience of serving on many committees of the Ministry of Food and other bodies during the last war and afterwards. It concerns the size and composition of the council of Food from Britain. I believe that members of the council should be selected on the basis of their experience and the potential contribution that they can make as individuals—and not because they are the nominees of sectional interests. Once one starts appointing on a representative basis, the size of a council or board invariably grows to unmanageable proportions. Therefore, I fully support the Minister in his policy of not having nominated membership and the limitation on the size to 13 to 15 members.

May I conclude by wishing Food from Britain every success under its able young chairman, Nicholas Saphir. I have known members of his family for many years and they have great experience and a fine record in the marketing field.

7.13 p.m.

Lord Stodart of Leaston

My Lords, it was the custom in another place, as it is in your Lordships' House, for the speakers who follow a maiden speaker to compliment him and say that the House would join unanimously in hoping that the maiden speaker would be heard on many occasions in the future. I have known one or two of my former colleagues in another place say privately that they rather wish they had not uttered those words of hope that the new Member would be heard on many occasions thereafter. But on this occasion I will say only that the keen anticipation that was expressed about the maiden speech of the noble Lord, Lord Northbourne, has been succeeded by a feeling of all-round satisfaction.

I find this a particularly interesting debate because marketing and the idea of exporting food, especially to Europe, was all the rage when I held the same office as that of my noble friend Lord Ferrers precisely 10 years ago. I have looked up some of the answers I gave to supplementary questions in another place and see I said, among other things, that a firm of consultants was making a study with the Government paying 90 per cent. of the cost; that investigations were covering cheese, meat, soft fruits, vegetables and flour; that the Central Council for Agricultural and Horticultural Co-operation was in the closest touch with cooperatives in the Community; and best of all, perhaps, and the greatest pearl of wisdom, that the need to co-ordinate the export of agricultural produce was being actively explored. How right the poet Longfellow was to mention what he did about the "mills of God".

There has been a considerable change in thinking on food production in the United Kingdom over the past 10 years and for this my right honourable friend the Minister and my noble friend Lord Ferrers and his colleagues deserve hearty congratulations. Gone is the attitude voiced by the former Board of Trade when, in giving evidence to the Select Committee on Agriculture some 12 years ago, it decried import savings by increased food production at home as being of little or no value. The noble Lord, Lord John-Mackie, referred to the fact that 75 per cent. of our needs for temperate foods are now produced compared with 60 per cent. some 10 years ago. I suspect that about the only temperate foods in which we are not self-sufficient are sugar, dairy produce, lamb and possibly (I am not sure about this) beef. This is a stupendous performance in what is one of the more densely populated countries of the world, especially when two other factors are taken into account. The first is the area of land which goes out of production, which is running at more than 50,000 acres a year. If one works that out, it means that an area almost exactly equivalent to the county of Norfolk has disappeared from agricultural production since the war.

The second factor is that the labour force in agriculture is only 3 per cent. or thereabouts of the labour force of the country as a whole. That shows the excellence and adaptability of farm workers. But as the noble Lord, Lord Sainsbury, has said, this great effort has tended to collapse at the farm gates. One tends to say, "Here it is. Come and get it". No one who has been to the food shows in Paris and Berlin, as I have done, has come home without feeling that we have been losing out to our competitors in Europe. Therefore, better marketing is again the call of the day—but spoken of and listened to with more assurance now because much more money is available at the launching pad. For this too, agricultural Ministers deserve a good deal of credit.

There are three points I wish to make. The first is that the United Kingdom is famous as a producer of red meat. The noble Lord, Lord Tanlaw, has referred to Scotch beef. I have often thought when looking in shop windows that more beef is labelled "best Scotch" than the whole of Scotland produces; and the best of Welsh and English lamb is rightly famous too. But I hope your Lordships will forgive me if I make one further point, which is not totally irrelevant. It is that efficient marketing can hardly succeed without efficient slaughtering. This branch of the industry has been encountering tremendous difficulty. Hardly any well-known name—I have no interest now to declare—has failed to make headlines in the last year in a way that they would much rather not have done. The main cause, of course, is over-capacity. It is not, I think, a matter for the Government, but it is certainly one for ratepayers, with I believe every municipal slaughterhouse, I suspect without exception, running at enormous losses.

I am looking forward with the keenest interest to what I am quite sure is going to be a success story, because one thing I have learned in 50 years of farming is that nature does not allow farmers to grow crops that combine high quantity with super quality. My noble friend has mentioned Charter Bacon and the Great Brit. Potato Adventure; and I wish them both the best of luck. But I am bound to say that throughout my 50 years of farming it has paid me better to grow a large crop and sell it at a lower price than vice versa. I have been offered premiums for smaller crops of high quality—and once I was even invited to send wheat to Canada in order that it might be made into biscuits—but even that operation did not pay me as well as the higher crop that I sold at a lower price. I am bound to say that I think that Food from Britain, which is, of course to market food at home as well as abroad, has got to bear this in mind.

The last points I have are somewhat sundry. My noble friend has said that the Bill does not include the marketing of sea fish. Perhaps he will tell me if I am right in remembering that shellfish probably are included, being statutorily different from sea fish, having a recollection of a very successful stand run by the Highlands and Islands Development Board at one of the parish shows with Orkney crabs.

Secondly, is Food from Britain going to involve itself in the export of such things as Scotch whisky? If it is, I hope there will not be overlapping between the fairly efficient Scotch Whisky Association and the Food from Britain campaign. Thirdly, I am fascinated to know whether the Food from Britain campaign is going at the same time to push the sales of butter and dairy products, which it obviously is, and also urge people to buy margarine, because the area of oilseed rape is fairly high in this country and increasing, and if it is to advocate margarine I am just wondering how the chairman of the Milk Marketing Board, who I think is a member of the Food from Britain team, is going to react.

Finally, I wonder this. Does anybody really know what the consumer really wants? I ask this because a fortnight ago I listened on my radio to a member of the staff of the Meat Research Institute saying that on no account should meat have any fat at all, and anyone who thought that fat gave even a hint of a flavour to the meat needed his head seeing to, because it did not; whereas in the Daily Telegraph on the same day there was an account of a small agricultural enterprise in Devon which was breeding the rather old vintage types of pigs, the Middle Whites and the Wessex Saddlebacks, all of which I recollect gave an enormous amount of fat, and it was inundated with orders from people who were tired of the stuff they were getting in the butchers' shops now. With those words, I wish Food from Britain all the luck in the world.

7.25 p.m.

Lord Collison

My Lords, I, too, wish to congratulate the noble Lord, Lord Northbourne, on his maiden speech. I enjoyed it very much, and quite obviously he is going to prove a very great asset in this House; like others, I hope we shall hear him often. I would also, if I may, apologise to the noble Earl, Lord Ferrers, because I was a few minutes late in taking my seat when he opened the debate; I am awfully sorry. The amendments on the previous Bill went through much more quickly than I expected. I am sorry to have done that, with the great regard and respect I have for the noble Earl.

This Bill has been widely welcomed. It was welcomed in the other place and has been welcomed here, and I join with those who welcome it and wish all good to the organisation which it is going to set up. I rise in order to call attention to the proposals which the Government have made and which affect the Land Settlement Association. If I throw a note of discord into this debate, it is not in relation to the Bill itself but in relation to what is being done to the LSA.

My interest in the Land Settlement Association has been a long one. I was a member of the executive committee for many years, first appointed 25 years ago. I became vice-chairman in 1964 and remained as vice-chairman until I became chairman in April 1977, a post I held until I retired in December 1979, when Sir John Colfox was appointed by the Minister, the right honourable Peter Walker. At that time the Minister was kind enough to write me what was a very nice letter which I greatly appreciated. He thanked me for my services over the years, and he said in that letter, if I may quote: You have seen many changes in the structure of the association and the smallholdings scheme since you were first appointed and can he justly proud of the high regard in which it is held today". That was at the end of December 1979. I am not quoting those kind words of the Minister in order to draw credit upon myself. There were many others, of course, who had contributed before me and have contributed after me: there are many others to whom credit was and is due: the previous chairmen, successive members of the executive committee, and a very dedicated and loyal staff. I mention it only to stress the changed attitude of the Government since then, and it is a relatively short time ago. I am sure your Lordships will appreciate my regret at the developments that have taken place.

The Land Settlement Association was set up to help people without much capital to establish themselves in agriculture as smallholders producing for the domestic market. To make this possible the Land Settlement Association built up integrated marketing and production machinery. There were tenancy agreements with each tenant, who was specially vetted before he was allowed into the scheme and who had to have a certain amount of capital, but clearly not enough to start on his own. Tenants could obtain a grant from the LSA and get bank loans which were underwritten by the Government. The LSA acted as the Minister's agent in these matters.

In all my time, these arrangements seemed to be working well. I visited many of the estates, particularly during my time as chairman, and was told by many tenants that they had successfully built up their own businesses, and they expressed appreciation of the Land Settlement Association, which had given them a chance to get their feet on the first rung of the agricultural ladder.

I have not buried my head in the sand. That would be stupid, and I know, as we all do, that horticulture has run into difficulties. Indeed, problems were beginning to affect the industry at about the time I left the LSA. At that time some tenants and some estates began to demand more freedom to conduct their own affairs. They were beginning, but only just beginning, to express criticism of the way in which the scheme was operating. Now, since I have left, those criticisms have built up and, reacting to those criticisms, the Minister announced on 1st December 1982 that he was convinced that the tenants of the estates should take over responsibility for the marketing of their own produce and declared his intention of terminating the current LSA marketing arrangements from the beginning of April 1983, and also of terminating the agency agreement and enabling tenants to purchase their holdings if they so wished and if they were able to do so.

This decision, though welcomed by some, caused consternation among many growers. My honourable friend, Mr. Stanley Newens, in a speech in another place on 20th December—reported in Hansard at column 736—said he had received a large number of letters expressing considerable anxiety about the decision. Many tenants believed that they would be seriously damaged and even bankrupted. They pointed out the difficulties they would face as a result of the very short time they had been given to make alternative arrangements. Those difficulties were intensified by the withdrawal by the Minister of his guarantee to the banks.

I am glad, therefore, that on 19th January the Minister, in reply to a Question asked by Mr. Anthony Nelson in another place, said that he was prepared to arrange for the continuation of the association's centralised marketing services up to 31st December 1983. But the Minister added that all other aspects covered by his announcement of 1st December 1982 will remain unaffected. Of course, the Minister hopes that alternative marketing arrangements can be made in time, but the growers are still faced with considerable problems, despite what I think is the tardy recognition by the Government that they had a point that the Minister has partially met.

LSA tenants, like everyone else in the industry, have been adversely affected by the problems which face horticulture generally. Many have run into debt. The Minister's withdrawal of the guarantee to the bank will make it very difficult to obtain the loans they need to keep going. Apparently the growers will still receive an account from the LSA from the end of December 1982, which has to be confirmed to have queries rectified, and to be paid to the estate office by—it was—28th February. Although I am not sure about this, it may now be by 31st December. The point is that failure to do so will result in two months' notice to quit.

Thus, the growers' prospects of ever getting on their feet and getting their feet on the first rungs of the ladder will be nil. Despite the extension of time, as I understand it the Government are asking for all the assets of the existing scheme—grading equipment, lorries and tractors—to be disposed of by 31st December, which I assume is the new date, and the new organisation can take over only if it can be formed in time.

My concern is for the growers. It is for the tenants. It is clear that many problems still remain for them. The Minister says that he consulted the tenants. I wonder how far that consultation went. Were all the tenants involved consulted? I was very keen to create consultative machinery. As the noble Earl knows, I thought it right to do so. I worked for it and we obtained a joint consultative council. However, I do not know how far this consultation went. I certainly hope that it went the whole way and that all the tenants were involved. I certainly hope that the consultation will continue on the many problems which will arise and will affect the tenants as a result of the Minister's decision. As Mr. Newans said in another place: Even the attraction of buying … at 50 per cent. of its valuation is not very brilliant to those tenants who are unable to pay up what they owe forthwith, as the Minister has made it plain that, before buying, a grower must clear any outstanding debts to him." (Official Report, Commons, 20/12/82: col. 738.) This remains true even if the extension of time to December 1983 applies.

I am not arguing for no change. I know that many growers wish for more autonomy and the freedom to market their own produce. However, it seems to me that, despite the extension, the Government have acted with undue haste and rather more than ruthlessly. They will cause embarrassment to many of the growers, who are worthy men, and also to the growers' families.

I ask myself: what is behind this precipitate action? What is the Government's motivation? It is apparently based on criticism by some growers. There are 500 of them on 10 estates, but in one fell swoop the Government have destroyed the whole of the structure which the LSA has administered in the past, I believe reasonably successfully, as the Government's agent. It looks very much as if the Government are thinking on the lines of what is called privatisation. I do not know, but it seems that way. It seems that criticism by some growers has been used as an excuse for the Government's action. Thus will disappear a scheme which was designed to assist those who could not otherwise have entered the industry. If adjustments were necessary, could these not have been made without bringing down the whole fabric of the scheme, instead of the Government getting out from under and abdicating what I see as their responsibilities?

The Government appear, I am afraid, to have made up their mind. If that is so, I sincerely hope that they will give careful and sympathetic consideration to the problems that will hit many tenants and their families. Again I say that they are worthy men and women. I hope that the Government will be flexible in dealing with them in order to give what help they can in the difficulties that will certainly arise in the future as a result of the Government's termination of the LSA scheme.

7.40 p.m.

Lord Stanley of Alderley

My Lords, I welcome the idea behind the Bill, for as a member of a number of agricultural co-operatives and, indeed, chairman of one for the past four years, I am more than conscious of the failure of farmers to bother to market their produce. So if I now air a few reservations, I hope that your Lordships will accept them as constructive, although I suspect that I shall, not for the first time or even for the last time, be chided by my noble friend and other Members of your Lordships' House for not joining in the general euphoria.

I am concerned that the council appreciates the inherent lack of interest—indeed, almost opposition—by farmers to organise their marketing, although I note that the Minister, Mr. Peter Walker, realised this in the third paragraph of his original press notice on 7th June. The failure to market our produce has been brought about in part by the system of support we have lived under for a number of years. Although it is, and has been, an exceptionally good system, it has not encouraged aggressive marketing, and in this connection I would entirely agree with the noble Lord, Lord Sainsbury. It is probably true to say that if a similar sum of money to that suggested in the Bill were given to farmers to improve their returns, it would be better spent lobbying the CAP in Brussels. I hope that my noble friend and the council will recognise that, and also the fact that many farmers—and I certainly include myself as one of the sinners—prefer to devote their energies to production rather than to marketing. Some accept this failing and join a co-operative. That brings me to my second worry, which is our co-operative movement which will come under the council when this Bill is enacted.

As the noble Lord, Lord Northbourne, so ably pointed out—and I should like to congratulate him on a superb maiden speech—the co-operative movement in the United Kingdom is totally different from that which operates on the continent. Our successful cooperatives, as the noble Lord said, are inclined to be small because we still believe in the "small is beautiful" philosophy; whereas our continental sisters are large and impersonal.

I personally would not wish to see our co-operatives grow into big brother organisations, but I think—although I may be putting words into his mouth—the Minister, Mr. Peter Walker, suggested in his statement to the press on 7th June that they should or might go that way. The snag with our small co-operatives is that they are inclined to be unprofessional, and when asked to shoulder extra burdens—and I envisage that this Bill may well put those extra burdens on them—their organisation is not up to it. Perhaps their two biggest difficulties seem to be the loss of personal contact with a member and getting the correct relationship between the farmer director and executive. There is a question of commitment and bite, as was mentioned earlier.

I hope that the council will appreciate this very real problem. One way in which they could help is to stop appealing to the loyalty of the co-operative—and I should like to point out to my noble friend that it is not a regiment that we are talking about, and you do not have the same loyalty to your co-operative as you do to a regiment—and try instead to make sure that returns received from co-operatives are better, because that is what will keep the co-operatives working successfully. That was brought out so ably by my noble friend Lord Stodart of Leaston, and, indeed, the noble Lord, Lord Tanlaw. However, I wonder how they will do that, because the Bill does not give the council power to control production. Indeed, I do not think that it should do so. But if such is envisaged, then your Lordships should think hard and long in particular about the method of appointment to the council. Here I seem to be at slight loggerheads with some. I am obviously concerned, sitting on these Benches, that should another Minister ever be in charge of appointments—although of course I cannot see that ever happening—a total turnover in the members should not occur. But, perhaps more seriously, I would ask my noble friend who the Minister will consult before appointing members to this council.

Finally, I am concerned as to what the council can do to help market British food; how they can do it; and when they can do it. The idea is perfect, but would any commercial undertaking put 15 totally strange people together and tell them to get on with it? The members of the council have an awesome problem, not least a personality one, of getting on and getting to know each other on the council. I really do wish them well, but I would not be surprised if they failed. I know that my noble friend will accuse me, and probably correctly, of being a Jeremiah. Therefore I repeat: the idea is right; the job badly needs doing, but perhaps those of your Lordships who saw Shakespeare's Richard III last night would appreciate that many of his objects were correct, although perhaps some of his methods were somewhat suspect. I hope that my remarks, if nothing else, will give the council an insight into the suspicious nature of a backwoodsman farmer with whom they will have to work and whom they will have to educate.

7.47 p.m.

Lord Mountevans

My Lords, I, too, join other noble Lords in congratulating the noble Lord, Lord Northbourne, on his lucid and stimulating maiden speech. In several respects he has pre-empted me, but I think that perhaps in several respects I was a party to my own downfall because I had the pleasure of helping him in the Printed Paper Office the other night. It is a pleasure to welcome the noble Lord to our House and I hope that we shall hear from him often.

I feel that I should declare an interest, albeit a distant one. I have worked for the British Tourist Authority for over 10 years, at home and abroad. Throughout that time I have been selling Britain to foreigners as a tourist destination—an activity which it seems to me parallels the overseas rôle envisaged for Food from Britain. My approach to the Bill before us tonight has been influenced by my experiences over the last decade. All but one of the BTA facts that I shall quote is published information, but any opinions that I may give, although discussed with senior colleagues within the authority, are my own.

I strongly welcome the Bill because I believe that any attempt to market British goods or services abroad is, in present circumstances, an effort greatly to be desired. while a body' which sets out to develop and co-ordinate such marketing is even better. Marketing abroad is a skilled and costly task, better fulfilled, I feel, by concerted effort than in dribs and drabs. Marketing abroad literally involves keeping our goods and services in the overseas shop window. A great deal of effort is needed not only in that generality but in attention to detail, to ensure that the customer is aware that our goods are of the right quality, arc available in the right place at the right time and are available at a price which he or she feels constitutes good value for money. Reading the Bill and the list of members designate of Food From Britain's council and looking at the experience that they have between them, I feel confident that the requirements I have listed and the criteria will be met.

I am a little less confident about the funding envisaged for Food from Britain—although I hope that the noble Earl the Minister will reassure me. It is, I understand, the intention that all marketing activity will be funded 100 per cent. by the industries concerned by the five years ending 1987–88. My reservations stem from the fact that for more than six years I have been running the budget of the British Tourist Authority's Joint Marketing Schemes. Quoting from the British Tourist Authority's last annual report, it says that this: budget attracts external funding for BTA activity and reflects Government's continued emphasis on 'self help'. The budget is allocated to co-operative ventures which are in line with BTA's marketing plan and objectives. These plans and objectives we have to sell to our promotional partners before we can go out and sell abroad. The funds for co-operative activity must be got in before they can be got out. Once we have them. our spending plans are still subject to exchange rate fluctuations; I am sure that several noble Lords will have seen The Standard tonight, reporting that sterling took another hammering against the dollar.

A fact which will I think affect Food from Britain, as it does us, is the harsh reality that at times when the sterling exchange value falls and makes the goods that we or Food from Britain are selling more attractive in overseas terms, it also makes the very overseas promotion of the goods or services we are selling more expensive. Food from Britain will doubtless have both strategic and long-term plans as well as practical plans. The time scales for planning these two facets will, I am sure, differ, and I am worried that Food from Britain's plans might go awry if it cannot sell its plans to its co-operators. Are the period of Government support through 1987–88 and the sum envisaged of £14 million by way of that support both inviolate facts, or will both be subject to review as time progresses? I ask the question against the backgound of experience that I have cited, but I also have in mind that Food from Britain's potential co-operators may disagree with that body about allocation of marketing resources to home and foreign markets.

Turning to matters of less substance, I would appreciate clarification of Schedule 1, paragraph 6, as to whether the words: … Food from Britain may appoint committees consisting of or including persons other than members of Food from Britain". permit those council members to serve on such committees. I hope that the members may so serve, as, looking again at the BTA's annual report, as well as those of a number of other statutory bodies, I notice that committees are frequently chaired by members of the parent board or council. It seems to me that this practice is sensible in that, as such, council members constitute an important channel for conveying and explaining policy one way as well as receiving experience in the other direction.

I notice that Food from Britain may charge for the services that it provides. I should like to ask the noble Earl the Minister whether services include advice, as I am a little concerned that the small businessman, the small operator, the small producer—call him what we will—who may well have a greater need of guidance than larger entities, will be put off from seeking such guidance by virtue of the fact that he may have to pay. for it. Even if the advice given is only, "Go out and join a co-operative", I hope that it will be freely given and will be given free.

I should like to raise one other small point; it concerns the use of the word "behoof" in the last line on page 7 of Schedule 1. Recently I attended what was in some respects the most interesting debate that I have had the pleasure, indeed the advantage, of hearing in your Lordships' House. It concerned the volume and the complexity of statute law and it makes me ask whether a word such as "behoof" still has a role to play in modern legislation.

I have spoken of my enthusiasm for this Bill and for the concept that it embodies. I see Food from Britain as a cousin in the family of statutory bodies. In fact, I am not the first person to see this; BTA and Food from Britain were bracketed together during the Standing Committee stage in another place. With the ready assistance of the Minister, we have already been introduced and I greatly look forward to meeting Food from Britain's chairman-designate within the next few days. I am sure that we shall find much to talk about, and I hope that we shall find scope for fruitful co-operation. I wish him, the council, Food from Britain and the Bill godspeed.

7.54 p.m.

Lord Wise

My Lords, I understand that it is the general practice for only the first three following speakers to congratulate a maiden speaker, but notwithstanding that fact I would very much like to congratulate the noble Lord, Lord Northbourne, on his fine maiden speech. I think that his wide knowledge and business expertise will surely be a great asset to this House, and I most certainly look forward to hearing him on many occasions in the future, and not only on agricultural affairs.

My noble friend Lord Stanley referred to himself as a backwoodsman farmer. Whether or not that is so, I do not think I would call him that, but I most certainly am. It is for this reason that I wish very briefly to speak and express my general support for this Bill. In his opening remarks my noble friend the Minister spoke of the achievements of the agriculture Ministry, and it is recognised that the efficiency and record of agricultural production is second to none. This production is obviously of inestimable value to our balance of payments position.

However, I think we farmers must now appreciate that our job no longer finishes at the farm gate. We must get out and take a greater interest in the selling of our products. Surely we cannot expect the consumer to buy British produce irrespective of its quality and its price. This means that we must use less of our managerial skills in increasing production efficiency, and devote more to increasing our marketing efficiency. We must take more notice of our grading and presentation and only present goods of the highest quality and conformity. I think that this is one aspect in which we have tended to fall down in the past.

I have a friend who grows a very large acreage of vegetables of all kinds in Norfolk; he probably grows as many as anyone else in the county. I know that he discards quite a considerable percentage of his produce as not being up to standard. However, he has a good and steady market for all the produce that he presents to his buyers; his grading is such that there is complete uniformity and, as he says, "First-class produce will always sell". I am certain that he would agree with the noble Lord, Lord Northbourne, that this is not always possible to achieve with co-operative systems. As the noble Lord, Lord Tanlaw, has said, the grading of all produce—not only of meat—is of paramount importance, but there must—and I think that Food from Britain should take great notice of this—be incentive for quality.

I am convinced that some degree of co-operation is essential in any marketing strategy, but I was glad to hear my noble friend Lord Ferrers say that the independent sections will not lose out under this Bill, and Food from Britain will be able to co-operate and will not be in competition with the small organisations which have already established their market outlets without any Government aid. I hope that that is so; I think I understood my noble friend to say so.

In the highly competitive food market both for export and at home it is essential that there is a well organised outlet for all commodities, especially those such as vegetable and horticultural products, and poultry and pigmeat, for which there is no intervention buying. For this reason I welcome the Bill and hope it will go far towards achieving this and thereby ensure a fair return for the primary producer and all the processors, retailers and wholesalers, plus value for money from the consumer.

7.59 p.m.

Lord Beswick

My Lords, this Bill has been given an unusually generous welcome from all political parties and it is a welcome which I support. The character of this piece of legislation, if I may say so, speaks well for the attitude and the aptitude of agriculture Ministers including the noble Earl, Lord Ferrers. I allow myself to add that if only the Treasury and Treasury Ministers were characterised by the same constructive and expansionist attitudes then our economy might be in much better shape.

My immediate interest in this Bill springs from my special interest in the co-operative movement in Britain. The Bill in its working, if not in its present wording, has much to do with co-operation as noble Lords have recognised, both in the production and in the marketing of agricultural produce. Some would say that it is a shortcoming of the Bill that there is no specific reference in the wording to the potential advantages of developing agricultural co-operatives.

I noticed that in the other place the Secretary of State listed those organisations that might have been expected to have had representation on Food from Britain. He named all the farmers' associations, the country landowners, even the Consumers' Association, but not, strangely, the British Co-operative Movement. Yet it is far and away the biggest organisation of consumers in this country. It is the largest farming organisation in the country and, with due respect to my very dear friend, the noble Lord, Lord Sainsbury, it is still the biggest retailing organisation.

I take this opportunity of congratulating the noble Lord, Lord Northbourne, on his maiden speech, which I found especially interesting in his references to co-operation. He was very realistic, as were those practical farmers from the bush now sitting on the Back Benches, the noble Lord, Lord Stanley, and the noble Lord, Lord Wise. What they were saying was that if we are to have co-operative organisations they have to be good. That is right. I would agree with that. I would say that that goes for cricket teams as well.

I was glad to hear the noble Earl, Lord Ferrers, say that the co-operative concept will have a contribution to make, but I would press him to expand this a little further for two reasons. The first relates to the Central Council for Agricultural and Horticultural Co-operation. My noble friend Lord John-Mackie, and indeed the noble Lord, Lord Sainsbury, and the noble Lord, Lord Stanley, paid tribute to the work of the central council, but it is now to be brought within the Food from Britain organisation. The apparent idea is that the CCAHC will retain its old responsibilities within the new structure. I am not completely convinced about the reasoning here. I am not sure that it is strengthening the central council's position. I am myself a great believer in decentralisation. I believe that if responsibilities are to be an incentive and a motivation, they must be seen, and seen clearly, from outside.

Of course, much will depend on the actual organisational structure of Food from Britain. It might be said that this is not a Second Reading matter, but the Minister has touched upon it in two respects. We are told that the vice-chairman of the parent organisation will be the chairman of the central council or its successor. If the chairman was the vice-chairman of Food from Britain by virtue of his being the chairman of the central council, that would emphasise the importance of the central council's future role. But, of course, it could work the other way. It could mean a blurring of the responsibility, and I should be most grateful if the noble Earl would spell out a little more about the concept as he sees it of the importance in the Food from Britain organisation of the central council's work.

The other relevant point that has arisen concerns the funding of the central council. It is stated that there will be Government funding for Food from Britain but phased out over five-years. On the other hand, I believe, though I should like confirmation, that Government funding for the central council will be continued after the five-year period. If there is this differentiation that would seem in itself to be an argument for having the central council still outside on a separate basis.

Over many years I have known some very interesting cases where Government funding, intended for a specific department or a specific project of a large organisation, found its way to support other activities within the same organisation—worthy activities, of course, but different. Accountants are very ingenious individuals in this respect. I should be grateful if the Minister could say a little more about the intended and continued role of the central council.

There is one other matter on which I should like to comment and on which, again, I seek assurances, that relates to the Land Settlement Association, about which my noble friend Lord Collison has spoken. If I may say so, there is no one better qualified than he to speak about the Land Settlement Association. As he indicated, on 11th August last year the Secretary of State applauded in a press notice, from which I quote, the considerable progress made in planning for the long term future of the Land Settlement Association". Then on 1st December of the same year the same Secretary of State stated that the marketing arrangements of the LSA would be terminated as from the beginning of April 1983. In other words, the long-term future, about which encouraging words were spoken in August, turned out to be less than seven months. By any criterion that is a strange turn around. In another context it would be called a U-turn. Can the noble Earl say what happened in the autumn of 1982 to justify such a change of attitude?

After representations and, as Lord Collison said, especially representations made by my Co-operative Party friends in another place, the Government again changed their mind and agreed to extend the time for termination until December this year. This concession is welcomed, but the noble Earl may understand that some suspicions still remain. Has there been a change of heart as well as a change of date because the heart did not seem to be in the right place last August. Many of these LSA tenants, good, hard-working men as they are, have been doing business with the sort of financial problems that are not unknown in Britain in 1983. The closure in March would have meant permanent closure for some of them.

I have heard it said that maybe the possibility of closure was one reason for this date being so extraordinarily inappropriate. One reason for this suspicion, which I hope the noble Earl will be able to dissipate, appears to exist because tomato growing—and these growers are especially concerned with tomato growing—has marketing problems, surplus problems. These people manage to produce something like 8,000 to 10,000 tonnes of tomatoes a year. The surplus problem is emphasised by an answer the other day given in the other place that 85 per cent. of the large EEC intervention stock of tomatoes was last year rendered unfit for human consumption. I hope that the Minister will be ready to say that there was no question of restricting production and making it difficult for all these LSA growers to remain in business. I am not here myself trying to suggest that we should go back to the old LSA set-up. Of course, it was open to criticism. Its original concept was not entirely realised, and improvements no doubt were possible.

I put three specific questions to the noble Earl. Will he make it absolutely clear—and I think it will be in his interests and remove a lot of suspicion if he will—that the original sudden death announcement about the LSA marketing scheme was not intended to eliminate some sections of the LSA estates? Secondly, will the Minister give assurance that all practical assistance will be given to the growers in this transitional period, both by way of advice—probably from the central council—in the establishing of co-operative marketing arrangements and also in suitable financial assistance? Thirdly, will the Government, under the Agency Agreement they have with the LSA, make sure that the position of the LSA staff, some of whom have served loyally for many years, will be safeguarded?

I am told that many of the LSA tenants are only too ready to strike out on their own. Far be it from me to discourage individual initiative, and I can well understand the temptation to buy land today at cut prices. That can indeed attract buyers. Some of those buyers may well make their own satisfactory local marketing arrangements, but there is a good deal of evidence to suggest that co-operation pays, in every sense of the word, in the marketing of agricultural and horticultural produce. When the first fine flush of being a land owner wears off there will be some of those former tenants who rise to the Government bait who will be glad that others had the good sense and tenacity to ensure the establishment of a co-operative marketing system when the present arrangements end.

Finally, I would ask the Minister if he would tell me a little more about this cut-price sale of the LSA land. It was stated in the Commons, and not contradicted, that the price at which the land will be offered will be 50 per cent. of cost. This surely cannot be true. Not 50 per cent. of original cost, I imagine. Probably the noble Earl can tell us what the facts are. The vacant possession price of grade one land in England last year was on average £2,689 an acre. Will the noble Earl be good enough to say at what sort of price this public asset of LSA land will be offered to the private purchasers? I have asked a number of questions. There are quite a number of people outside who will be interested in the answers, and I look forward to hearing what the noble Earl has to say.

8.13 p.m.

Lord Saint Oswald

My Lords, I rise in this debate partly because I wish to be among those to congratulate the noble Lord, Lord Northbourne, on his maiden speech, and to agree with the confident prediction made by the noble Lord, Lord Sainsbury, that we can look forward to many valuable contributions from him in future debates. Unlike some others I have had the advantage of knowing him for a number of years, giving me some awareness of the enterprise and energy with which he produces and markets grain and vegetable crops, seeking fresh territories to develop and make fruitful. He is therefore speaking to us with real knowledge, as most speakers in this House do.

He even sought my advice on one occasion with an impressive scheme in mind to plant a specific crop in a part of Spain with which I was familiar, but in this instance his creative intention was inhibited or curbed for the time being. It occurred to me that adventurous Englishmen in the first Elizabethan era went to Spain to pillage; he was going to plant and improve the territory of Southern Spain, with lettuces on a vast scale, as it happens.

Like him, though on a far smaller and less original scale, I have to declare an interest in this debate and in this Bill. Farming, as I do, in Yorkshire and Lincolnshire, lately but increasingly I have been exporting to new and previously hardly considered markets. I have sold rose bushes to Zambia and Zimbabwe, to West Germany, and, more surprisingly, to the Netherlands, who in the past have been so successful in penetrating British markets. I have sold cows to Iran, and so modestly assisted the balance of payments in that direction.

None of this is altogether easy, and apart from imagination and alertness it often requires the overcoming of artificial handicaps. In the agricultural and horticultural fields my managers have described to me frustrations imposed upon our production. It is recognised that Britain does not obtain an equitable share of the home market in dairy products. The milk flows prodigiously from British udders, but cheese and butter and other dairy products from overseas appear in profusion on the shelves of the supermarkets of our land. Is this a weakness in marketing methods? We are undoubtedly efficient pig producers, but bacon and ham from other sources flow in for consumption at British tables. It may be, as my noble friend the Minister has implied, that marketing is the key, and he mentioned some telling examples.

There are other examples somewhat less telling and less hopeful. I am assured, without being directly involved, that Britain produces cheaper quality lambs than any other member of the European Community, and yet our share of the Community market is relatively small. Is this also a failure of marketing methods and skills, and would it to some extent be redressed by the provisions of this Bill? My noble friend beside me said in his speech that we do not meet our own production needs in lamb. If that is so the question may well lie less in marketing than in productivity. That is one of the things that could be looked at.

The emphasis throughout this Bill is consistently on food, and therefore I felt that I ought to discover for myself whether flowers and flowering plants were actually included, as I find they are. Rose growing is a field in which I am directly and almost emotionally involved. As a long-serving and identifiable European, I can commit myself to probe where it seems that inequities between our partners and ourselves exist. Is it the case that for horticultural products the Dutch Government provide a highly preferential gas tariff for growers which gives them the edge over our own growers paying steep oil-fired heating costs with no preferential treatment of special allowances from the Government? I am specifically not arguing that under-the-counter advantages should be given to us. I am arguing, as a good European, for tighter regulations and fair trading, so that quality growing and good marketing cannot be offset by the methods of others.

We import, as is right, from our partners in the Community, but have in the course of trade discovered a problem of quite a different nature from that which I mentioned earlier. It is believed by those engaged at first hand in horticultural trade between the Continent and the British Isles that the looser discipline on road vehicle tonnage of wagons gives the Continental growers, or some Continental growers, an advantage over our own. As an example which has come directly to my experience, a single Dutch wagon can carry more tonnage on Dutch soil than an English wagon is permitted to carry on English soil. A built-in disadvantage becomes apparent; a disadvantage which can be critical in highly competitive trade.

Finally, I have one specific question which should not, I think, need asking but upon which still unsatisfied ignorance exists and of which I have given prior notice to the Minister who will wind up this debate. Should VAT be paid on consignments of agricultural and horticultural produce going overseas; should it be paid at this end or not? That question has been put to Ministry officials in Yorkshire, who have admitted that they do not know the answer. There must be a specific answer, and I hope to receive it, for the benefit of many in doubt, from the lips of my noble friend Lord Ferrers when he replies to the debate.

I, among almost all others who have spoken, can give my uncritical blessing, for what it is worth, to the Bill, and to its future. I am probably echoing a passage in the speech of the noble Lord, Lord Northbourne, when I say that, so long as the purpose of Clause 2 comes to signify what it says, the original purpose of bringing the Ministries of Agriculture, Fisheries and Food under one roof and under one direction will have been carried an important step nearer to reality.

8.21 p.m.

Earl Ferrers

My Lords, I am grateful for the welcome your Lordships have given to the Bill. Almost without exception, noble Lords have welcomed its provisions, and I am grateful to them for that because the introduction of Food from Britain is a milestone in the life and production of marketing in this country.

I wish at the outset to add my sincere congratulations to the noble Lord, Lord Northbourne, for what I thought was a model maiden speech; it was short, uncontroversial, knowledgeable and fun to listen to. It came, of course, from his substantial knowledge as a farmer who is well versed in co-operatives. I have always thought that the law of a co-operative should be that everyone should be prepared to put in more than he gets out; and if all are prepared to put in more than each gets out, each gets out more than he puts in.

The noble Lord rightly commented that 100 years ago all food was prepared either in our farms or our kitchens, whereas now the bulk of it is manufactured or processed before it is eaten. That is the nature of the game we are in; that is the monumental change which has taken place and that, in a nutshell, is one of the reasons for Food from Britain. The tremendous move to processing inevitably involves marketing, and it is our desire to see that marketing is as efficient as possible. The noble Lord referred to the definition of "marketing". I can confirm that, although it is not actually defined in the Bill, it is interpreted as widely as possible.

I was grateful to the noble Lord, Lord John-Mackie, for his welcome of the Bill, particularly as it came not only from the Opposition but from a former holder of the office I have the honour of holding at present in the Ministry of Agriculture. He made a passing reference to the fact that the Bill had taken a long time to come forward, and that whereas it is now 1983, it was being talked about in 1979. I would only advise him of the remark made by my right honourable friend when asked that very question. He said, "We have not had Food from Britain for the last 2,000 years. If we take a few more months to get it right, I do not think the country will be much the worse off".

I was glad that he and the noble Lord, Lord Sainsbury, agreed it was good that there should be no statutory members of the council, and the noble Lord, Lord John-Mackie, was glad it was not a question of Buggins' turn. He is absolutely right. The point is to choose lively minds; they make things work and, on the whole, Buggins' turn is not a recipe for scintillating activity. That is why this recipe has been produced in the Bill. My noble friend Lord Stanley asked who was consulted over it. I would remind him that the Bill gives the agriculture Ministers power to appoint the people, and they should have interests in connection with agriculture; I do not have the precise wording in front of me. The matter is considered with people, but there are no specific strictures to take official soundings or recommendations.

The noble Lord, Lord John-Mackie, asked a question which his noble friend Lord Blease would have asked about Northern Ireland: whether Ulster produce would be able to continue to be marketed under that name. Yes, it will be. Food from Britain will help to develop the marketing of food from the regions, and there will be no loss of regional identity. In saying that, I am glad that the wish of the noble Lord, Lord John-Mackie, of 50 years ago has become a fact and is no longer just a dream. I am glad that it is the party to which I happen to have the good fortune to belong which has been able to introduce it, while appreciating the fact that the noble Lord did not have the good fortune.

The noble Lord, Lord Tanlaw, said promotion must not be at the expense of quality and consistency. He is absolutely right. The powers given to Food from Britain in Clause 2 to improve marketing are very wide. It will be up to the Council of Food from Britain to determine its own strategy within that framework, and I am sure it will place particular emphasis on improving the marketing of quality products which are geared to the demands of consumers. Food from Britain will not be in the business of endorsing Britishness just for its own sake. It will aim to ensure that the best of British food—including Scottish, Welsh and Ulster food—is available both here and abroad.

The noble Lord gave a bleat (if that is the right word) for Scottish beef producers—that they should get better prices—and he said he wished to draw that to my attention. I respectfully suggest that there is not much point in doing that. He gave a classic example of how, with an excellent product which in his view should commend better promotion, better success and a better price, promotion should be available to achieve that, and I have no doubt that Food from Britain will take that on board. But of course it is up to those who produce, if they feel they are not marketing their goods properly, so to organise themselves. And from what Lord Tanlaw said, he seemed to indicate there was scope for improvement there.

The noble Lord, Lord Sainsbury, spoke about marketing. If the record of one who is so distinguished and who has such a distinguished household name does not show him to know how to provide what the consumer wants, I do not know what does. He said we were the best producers in the world but that we had slipped over marketing. I agree entirely, as does my right honourable friend, as he knows only too well. It has been my right honourable friend's intention and desire to see improved the marketing not just of British agricultural produce but of British food and the noble Lord is right to say that marketing involves discipline.

My noble friend Lord Stodart wished success to the Bill and I was grateful to him for that. Like the noble Lord, Lord Tanlaw, he also said that the United Kingdom produces the best beef in the world, and there is no doubt that there are opportunities for promoting that in a better way than has been done in the past. He quite rightly referred to the slaughterhouse difficulties. As he said, good beef cannot be produced if there are not available good slaughterhouses. My noble friend is quite right; there is overcapacity. Slaughterhouses in this country have been going through a very difficult time. He is also quite right to say that no Government can be disinterested, though in fact the matter is not a responsibility of Government.

My noble friend asked whether Food from Britain will he involved in the marketing of Scotch whisky, butter, or margarine. Food from Britain may be concerned with the marketing of any food and drink, whether it be whisky, butter or margarine, and there is a place for all products on the market. Food from Britain will work closely in co-operation with all the existing organisations, to add to their efforts and so strengthen our achievements both at home and abroad. My noble friend asked whether shellfish are included under the Food from Britain organisaton. Shellfish are included in Food from Britain's activities.

The noble Lord, Lord Collison, apologised for missing my opening remarks, due to the fact that in the preceding business amendments went rather quickly. I can sympathise with that view; I nearly missed my own opening remarks, if I may so put it. The noble Lord expressed concern about the Land Settlement Association. Indeed, the noble Lord's deep inside knowledge, which has been gained from 25 years' experience on the association's executive committee, has made him uniquely qualified to speak on the Land Settlement Association. I am very grateful to him for the remarks that he made on that matter, on which the noble Lord, Lord Beswick, also made various comments.

I should like for a minute to consider the Land Settlement Association. I can understand the sorrow of the noble Lord, Lord Collison, at seeing disbanded something in which he was deeply involved. He is quite right; the growers are worthy people. They are what one describes as the salt of the earth, prepared to work with their families for all hours, frequently for very modest returns. They do it because they want to be independent and because they are determined to make a success of it.

It is a sad fact that horticulture has had a difficult time over the last few years. The Land Settlement Association has had a very difficult time. There are people in the association who have difficulties, and whatever might have been the course of the association's activities they would still have had difficulties. Our business as a Government has been to try to extricate as many growers as possible from the difficult position in which they find themselves. The noble Lord, Lord Collison, asked what consultations there had been. I can tell him that 18 months ago I attended a growers' conference in Cambridge. Many growers, and many Members of Parliament representing them, have come to see me and to tell me of their plight.

The noble Lord, Lord Collison, asked, why had the Government been so precipitate? The cry from the growers has been—I am now generalising—that the Government must act, and must act quickly, because otherwise individuals will be in difficulties. That is what we have tried to do. We wanted to give growers the opportunity to take over the responsibility for the marketing of their own produce. It is clearly far more appropriate for growers themselves to do this, rather than for the Government to do it. It is also something for which a large number of LSA growers have asked, and indeed it was very much in line with one of the recommendations of the Wise Committee, which was made as long ago as 1967.

So often there came the complaint that the Government were involved and that the Government were telling growers what to do, whereas they wanted to organise themselves; and that is what we have tried to enable them to do. We feel that it is right to offer the tenants the opportunity to buy their holdings at tenanted value. The noble Lord, Lord Beswick, asked, at what kind of value were they to be offered? The holdings are to be offered at tenanted value, which depends upon the value of the land and the assessment that a valuer makes of that. This in fact represents an attractive deal for those who wish to buy. Those who chose to remain as tenants will, of course, have security of tenure for their lifetime.

The response to our announcement has been encouraging. The main worries of the tenants concern the timetable for the close-down of the LSA's marketing services, and the announcement that my right honourable friend made last week has, I think, gone a long way to removing those worries—

Lord Beswick

My Lords, will the noble Earl allow me to intervene for a moment? Did I understand him to say that the holdings are being offered at the full value? If that is so, where did the 50 per cent. idea originate?

Earl Ferrers

My Lords, the holdings are being offered at tenanted value, and I am sure that the noble Lord, Lord Beswick, will know the difference between tenanted value and freehold value. I do not mean that in any disparaging way. Very often the tenanted value is in the region of, maybe, 60 per cent. of the freehold value. That is a fact of life. I am not saying that that is the figure that will be given in each individual case. But one of the facts is that tenanted value is about 60 per cent. of the freehold value. Whatever figure is assessed, the occupant will be able to purchase the holding at tenanted value. If he so wished, he would then be in possession of something that he could sell thereafter at freehold value. That is why it is quite an attractive proposition for the tenant.

The noble Lord earlier asked what is being done about Government accountability—I think that those were almost his words; that the Government were selling off land at lower than market value. In fact it is not lower than market value, because the market value is the value of the land with the tenant on it. It receives a greater value only when it becomes freehold. By doing this, we shall be giving the tenants who, in many cases, have spent a lifetime on their holdings, the opportunity to purchase them, the opportunity to own their own homes. We shall be giving them the opportunity to run their own businesses, to run their own co-operatives, as opposed to being dictated to by Government; and we shall be extricating the Government from a business which in fact they should not be in.

The noble Lord, Lord Collison, said that it started in the 1930s. He is quite right. The LSA started under very difficult circumstances. It tried to encourage people who were out of work to take on a new job and a new life. That was appropriate in the 1930s. But people have gone in and have found that they did not achieve quite the results that they had expected—

Lord Collison

My Lords, in all my time with the LSA I never gained the impression that the tenants thought that they were being dictated to by Government. They saw the Land Settlement Association, which was of course the Government's agent, as an entity in its own right, and therefore they did not say that the Government were interfering, though sometimes they criticised the LSA for doing certain things, or for requiring certain things that they did not like.

Earl Ferrers

My Lords, I think that the dictation to by Government—if that is the phrase that I used; and it was probably not the best of phrases—was due to the fact that growers were obliged to market all their products through the LSA. If in their view the LSA did not market them as well as it should have done, the growers were struck with no other outlet.

Lord Beswick

My Lords, I apologise for interrupting, but if one follows the argument, one finds that the old arrangement was not so completely satisfactory. What advice, what financial arrangements, are to be forthcoming for the transitional period?

Earl Ferrers

My Lords, there have been a number of statements by my right honourable friend explaining what is to be done. I think that it would be difficult for me to go into them in detail now. But I would say that we originally set a deadline for April of this year. There were complaints that that was not long enough for LSA tenants to make their own arrangements for their own co-operatives. We have extended the deadline to December 1983 for those who wish to continue to market through the LSA. For those who make their own co-operative arrangements meanwhile, that is in order. There have also been extensions for facilities with regard to their financing.

The noble Lord, Lord Beswick, asked whether there was any link between the resolution of the problems of the LSA and the tomato marketing report. I can tell him that there was absolutely no link whatsoever. There was no intention of deliberately removing the LSA in order—as I think the noble Lord said—to eliminate some section of tomato growers from the market. He asked what advice was to be given to the LSA estates in the meanwhile. The advice will be available (and is already available) to the estates from the LSA and from the Central Council of Agricultural and Horticultural Co-operation. The usual grant-aided assistance for the estate co-operatives will be available.

The noble Lord asked about redundancy terms for LSA staff. These are being agreed with the LSA staff through the usual procedures, and I hope that many in any event will be soon re-employed in the successor co-operatives. LSA employees will also be able to buy their houses.

My noble friend Lord Stanley asked whether Food from Britain will encourage larger co-operatives. Food from Britain will continue the work of the Central Council and will encourage the development of co-operatives of whatever size the members may wish. It will not impose upon them any blueprint for their organisations.

The noble Lord, Lord Mountevans, referred to the £14 million available over five years. Clause 7(1) enables the Ministers to make grants to Food from Britain. We have indicated what the Government's intention is; and it is to give £14 million over a five-year period. Food from Britain can co-opt outside people for work on the boards of the organisations. Will there be a charge for services?—Of course, the only services for which there would be a charge would be such things as publications or substantial market research or the setting up of promotional activities, but not for advice to the small man who goes along to ask a question. The noble Lord asks whether it was necessary to use the word "behoof". I am bound to say, that I, too, think it is a quite extraordinary word; but the Scots have very extraordinary language and apparently it is essential in Scottish law. Considering that we are dealing with cloven-footed animals as well, I do not know that it is totally inappropriate to have this word "behoof" in the Bill.

The noble Lord, Lord Wise, asked whether, if small, independent traders are doing good marketing jobs, Food from Britain will interfere. Food from Britain will not interfere if all parties are content; and the small producer will continue as now.

My Lords, there are a number of other questions which some noble Lords have asked but to which I fear time prevents me from answering. I would merely say, if I may, that we have seen a continuing and significant improvement in the productivity and efficiency of our agricultural sector. We are now 75 per cent. self-sufficient in the types of food that we can grow in this country and that, itself, is a remarkable achievement. To a great extent, these achievements have been in isolation from each other. Each sector has tended to view others as rivals without discerning the degree of common interest among them. The potential benefits to the nation as a whole from joint ventures to achieve the same goal ought to be able to bring about quite considerable improvements. We want to see British food on the tables of the world. I hope that this Bill will encourage that to happen.

On Question, Bill read a second time, and committed to a Committee of the Whole House.