Meat and Livestock Commission Levy Scheme (Confirmation) Order 1987

HL Deb 21 July 1987 vol 488 cc1287-91

4.5 p.m.

Lord Hesketh rose to move, That the draft order laid before the House on 27th April be approved [19th Report from the Joint Committee].

The noble Lord said: My Lords, this scheme is presented in accordance with the requirements of Section 13 of the Agriculture Act 1967, as amended by the Agriculture Acts of 1970 and 1986. The order replaces the existing levy scheme set out in the schedule to the Meat and Livestock Commission Levy Scheme (Confirmation) Order 1979 and varied in 1981. It provides for a new scheme, which has two features. First, the current joint levy, to which both producers and slaughterers equally contribute, is retained. This joint levy raises money to meet the MLC's general expenses just as in the past. Secondly, the order introduces a new levy to fund species promotion. This will be payable by producers alone. In both instances the levy scheme stipulates the maximum amount that can be charged. However, the actual amounts within these maxima will continue to be determined by the MLC in consultation with the appropriate representatives of the industry.

Your Lordships may find it useful to recall the background to the development of this new promotional levy, sometimes called the "bolt-on" levy. Over the years there has been a growing awareness within all sectors of the British meat and livestock industry that production and marketing must be more fully integrated and that marketing requirements must be explored and assessed and production systems geared to meet consumer demand if meat promotion is to be really effective. Nevertheless, meat promotion is a difficult area. It is an area where there are differing views on the best mix of promotional activities and how they should be funded. This was why the MLC set up an independent review team in 1984 to review the promotion of British meat.

The resulting Webb Report proposed that the existing levies should continue to be used to support the MLC's general activities and its campaigns to promote the positive image of meat. Funding for this should remain shared equally between producers and the meat trade. But the report also recommended that producers alone should be enabled to contribute, through a new and additional statutory levy element, for theme and species promotion. This is the "bolt-on" levy. The conclusions of the Webb Report were generally accepted by the industry, and last year the Government brought forward legislation in the Agriculture Act 1986 to provide the necessary framework to permit the new element in the levy to be raised. This too was widely welcomed by the House.

The Commission's draft scheme would give effect to the Webb recommendation on species promotion. The proposed species promotion levy has been the subject of very wide consultation with the industry over recent months. Organisations representing the prospective levy payers welcome it. Indeed they are anxious for funds to be raised as soon as possible so that the promotion councils established for the different species of meat can press ahead with enhanced promotion campaigns for beef, lamb and pork this year.

The draft scheme also retains the existing maxima for jointly funded levy. The Commission announced last August that the actual rates for general levy would not be increased in the current financial year so as to minimise the increased burden on livestock producers. In fact the MLC has not raised general levy rates since 1983/84, despite inflation, and has maintained its level of activity by increasing efficiency.

I am pleased to pay tribute to the Commission's responsible and professional approach in successfully presenting the case for meat and meat products as part of a balanced and healthy diet. The MLC has worked co-operatively and successfully with health authorities to get over the message that meat continues to be an excellent source of protein, vitamins and minerals. The Commission's response to the Webb Report, its implementation of a new marketing strategy and the reorganising of its meat promotion effort have all been commendable and importantly have been carried forward with a strong measure of support from producer organisations, whose members will be paying the new levy. I understand they are keen that collection for the new levy should start as soon as possible—a strong endorsement. Clearly the present order will help the MLC to continue its valuable work on meat promotion and much else besides. I ask your Lordships to support the Motion. I beg to move.

Moved, That the draft order laid before the House on 27th April be approved. [19th Report from the Joint Committee] —(Lord Hesketh.)

4.9 p.m.

Lord Gallacher

My Lords, I first thank the noble Lord for introducing so clearly the details of the order. In one respect, as he says, it breaks new ground; namely, the introduction of the species promotion levy. It was gratifying to hear that producers apparently are in great haste to see the levy introduced and, indeed, to pay it. That is a novel situation in the meat trade so far as I am concerned. I hope that the producers will be satisfied with the outcome of the expenditure for which the levy now provides maximum rates in respect of cattle, sheep and pigs.

I noted that the maxima vary over the general expenses levy in certain respects. No doubt there are good reasons why the cattle species promotion levy should be 40p more, the sheep levy 4p less and the pig levy remain the same. I shall not ask the Minister to tell us now why all these things are as they are but in due season he might care to let me know.

Perhaps we may whether, in introducing this new form of generic advertising, which I think is what it is, there will he the maximum co-operation between the Meat and Livestock Commission and the producer for which it is acting as well as the Food from Britain organisation. One has felt for a long time that much of what is being done in this area; if properly co-ordinated, could at the end of the day serve better the needs of producers and the consumer.

I should like to raise one further point with the Minister. Although the general expenses levy is not being increased—and, as he has said in his remarks, it has been held at 1983–84 levels—the collection of the levy falls in the main on slaughterers acting as agents on behalf of the Meat and Livestock Commission but with an obligation both to collect and account for the money. Some years ago the Meat and Livestock Commission attempted rationalisation of slaughterhouse capacity in England and Wales which was felt at that time to be excessive. There were indeed a number of small slaughterhouses operating at less than capacity. It tabled as a basis for discussion and after study three schemes for the industry to consider. I wonder whether the Minister could tell us if anything positive emanated from that initiative. One would not expect to have a reply to such a question without notice this afternoon but perhaps at some future time he might care to let me know. We welcome the levy and again thank the Minister for the manner in which he introduced it.

Lord Mackie of Benshie

My Lords, we on these Benches would like to welcome the order. I should like to pay tribute to the work of the Meat and Livestock Commission in general which I think is of great value. Only this morning before I left home the Minister will be pleased to hear that I was reading some of the costings of the schemes for grazing cattle. I shall be going home after we rise to read the general work on the pig industry. This is all very important and is much appreciated by farming as a whole.

I welcome the new order and the new payment and will be very happy to pay it. However, I have always been a little puzzled about why the producers should pay the whole of the promotional levy. Perhaps the Minister can explain a little further why the manufacturing and retailing industry, which takes more out of the public by way of cash than does the primary producer, is unwilling to pay its share or has been excused from paying its share. I know that producers generally have welcomed the order but they thought when it was being discussed that perhaps the trade—manufacturing and retail—might well pay its share. Perhaps the Minister could tell us why it is not so doing.

Lord Hesketh

My Lords, the Meat and Livestock Commission has a wide brief. At the centre is the furtherance of the British livestock and livestock products industry. The noble Lord, Lord Mackie of Benshic, asked why more people were not contributing to the new promotional levy. It would probably be quite difficult to persuade the retailers to engage in this and the vast majority of producers are in agreement that we want to get the marketing of the product improved as fast as possible.

Lord Mackie of Benshie

My Lords, as I said to the Minister, in the case of the normal levy there is no difficulty in collecting it from both sides.

Lord Hesketh

My Lords, as the noble Lord, Lord Mackie of Benshie knows, this levy is in addition to the normal levy. However, it has been welcomed and I hope that we shall see the benefits of it sooner rather than later.

The noble Lord, Lord Gallacher, referred to the collection of the levy by slaughterers. The MLC has several times considered appropriate means of collecting the levy but has always come back to the levy at slaughter point as the most effective and practical way. I am sure that it will continue to investigate it because, as with any levy, those who have to collect it do tend to complain and feel that others could also do it. I was grateful that both sides of the House welcomed this move and I hope it will be seen as a positive one for the industry as a whole. It is clear that the producer organisations attach considerable importance to the new levy in their efforts to promote British meat. I feel sure that the MLC can co-ordinate these efforts to good effect, working through the promotion councils it has set up. I ask your Lordships to support the Motion.

Lord Rugby

My Lords, before the noble Lord sits down perhaps I may ask him one question. If the levy is to be used for the purposes of promoting the livestock products, especially beef, could he draw the attention of those who are drawing the levy to the fact that the British services, especially the Navy, which obtains Uruguayan beef, utilise and are provisioned by foreign beef? Surely it is about time the commission carried out its task and promoted British products for the services of this country.

Lord Hesketh

My Lords, I shall most certainly draw this to the attention of my right honourable friend.

On Question, Motion agreed to.