Common Agricultural Policy (Hansard, 14 June 1991)

The Minister of State, Ministry of Agriculture, Fisheries and Food Baroness Trumpington)
My Lords, my right honourable friend the Minister of Agriculture, Fisheries and Food has clearly stated the Government's views on reform of the CAP. We are now awaiting proposals from the Commission. The answer to the second part of the noble Lord's Question is, no.

Lord Bruce of Donington
My Lords, bearing in mind that the highly protectionist nature of the common agricultural policy is already causing difficulties in the GATT negotiations and is costing the average British family of four an extra £15 or £16 a week according to the Government's figures, will the Minister undertake that radical negotiations on the whole nature of the CAP will be initiated by the Government in order to ensure that the GATT negotiations that are due to take place later this year will not be further impeded?
As regards the answer to the second part of my Question, will the Minister at least ensure that the guidelines given by the Treasury to the Minister of Agriculture for use at the Agricultural Council are published not necessarily before the negotiations are concluded but afterwards in order that the British people may know what degree of Treasury control there is over the outrageously large expenditure by the United Kingdom on the common agricultural policy resulting in an annual deficit to the UK of some £2 billion of Exchequer funds?

§ Baroness Trumpington
My Lords, I am grateful to the noble Lord, Lord Bruce of Donington, for having given me an indication of what he intended to ask in his supplementary question. The Commission pro-posals are not specifically linked to the GATT negotiations and are unlikely to address key issues for the round; for instance, import access and export subsidies. Agreement in the Community will not be reached quickly. A GATT settlement is likely to be reached first and will provide a framework in which CAP reform will have to be negotiated. The figures which the noble Lord gave for the cost to an average British family are OECD figures. They clearly over-state the cost of the CAP as they are based on static world prices. World prices apply only to the small proportion of world food production which is traded internationally, often at subsidised prices. If the CAP did not exist, EC consumers would certainly not be able to purchase their food at those prices.
As regards the last part of the noble Lord's question, internal documents are never published.

§ Lord Boyd-Carpenter
My Lords, my noble friend referred to proposals awaited from the Commission. However, is there any reason to believe, on past form, that the Commission will bring forward proposals which are sufficiently drastic to deal with the scandalous working of the common agricultural policy? Is she further aware that to an old Treasury 1281 hand, it was a great pleasure to hear the noble Lord, Lord Bruce of Donington, advocating strict Treasury control?

§ Baroness Trumpington
My Lords, the United Kingdom welcomes the Commission's acceptance that reform of the CAP is needed. However, we do not favour the Commission's approach. In particular, we reject the emphasis on safeguarding small farms which would tend to make EC agriculture less able to adapt to market forces, would severely disadvantage UK farmers and would probably increase the cost of the CAP.

§ Lord John-Mackie
My Lords, is the noble Baroness aware that the last time there was a free market—between 1926 and 1935—a working man had to work three times longer to buy the same food (for example, bread, milk and butter) than would be the case today? Therefore, we must be very careful as regard; what action we take on the food market.

Baroness 'Trumpington
My Lords, I am most grateful 1 to the noble Lord for his trip down memory lane.

§ Lord Campbell of Alloway
My Lords, does my noble friend agree that the publication of negotiating guidelilnes could only prejudice the course of future negotiations?

§ Baroness Trumpington
My Lords, the fact is that we do not publish internal documents.

§ Lord Gallacher
My Lords, will the noble Baroness tell the House whether the present initiative by Commissioner MacSharry for radical reform of the CAP, to which Her Majesty's Government are opposed, will be discussed in this House and in the other place in government time before any final decisions are taken by the United Kingdom about its attitude to those proposals?
As regards prices, will the noble Baroness confirm that the 1991–92 CAP price settlement, announced in another place on 3rd June, was described as being within budget guidelines?

§ Baroness Trumpington
My Lords, my right honourable friend the Minister of Agriculture has announced and always does announce any decisions taken by the 12 countries involved in taking those decisiors. The point is that it is a decision by all 12 countries. Therefore, there would be little point in discussing what we hope to achieve. Indeed, my right honourable friend has had enormous success in his achievements.
As to the guidelines, they have not been increased and, therefore. the Commission is legally required to keep expenditure in 1991 and 1992 within the existing guidelines.

§ Lord Elton
My Lords, as regards my noble friend's reply to the first supplementary question, does she agree that while the linkage between GATT and CAP may not be formal, it is actual and real? Does she agree that the failure of GATT would have far more lasting and severe consequences for this country than the continuation of CAP?

§ Baroness Trumpington
My Lords, the Government are working for a solution to GATT. They hope very much that agreement will be reached among all nations.

§ Lord Stoddart of Swindon
My Lords, will the Minister inform the House whether food surpluses are increasing or decreasing and whether it is true that the Irish Government have now hired grain ships for storing wheat because they have run out of storage space on land?
Will she also confirm that the CAP has resulted in many British farmers going out of business? Thousands of small farmers have gone out of business? in this country and in the Commonwealth. Is that to be the continuing result of our adherence to an absurd agricultural policy?

§ Baroness Trumpington
My Lords, I should love to answer questions about what the Irish do, but that must be for another day and for the Irish to answer. With regard to farmers going out of business, many reasons have led to the difficult times which farmers are experiencing at present. Those reasons include falling world prices, difficult markets and sometimes lack of marketing on the part of our farmers. There are a variety of reasons. One cannot lay the full blame at the door of the CAP.

Lord Bruce of Donington
My Lords, the noble Baroness cast doubt on the figures which I cited in regard to the extra cost borne by the average family of four in this country as a result of the CAP. Is she aware that the figures I cited were taken directly from the Treasury's bulletin, which I assume has been read by her department?
Is the noble Baroness further aware that publication of the guidelines would in no way affect the negotiations which take place on the price review because my question specifically stipulated that they should be published after the negotiations have taken place? It would be in the public interest to know the Treasury's attitude towards such outrageously high expenditure.

§ Baroness Trumpington
My Lords, any Minister speaks on behalf of the entire Government. It happens in this House. The latest OECD figures which I have imply for 1990 a consumer cost for the CAP of approximately £11.20 per week per family of four and a total cost—that is, including the cost to the taxpayer of CAP expenditure—of £17.50 per week.

§ Baroness Elles
My Lords, does my noble friend agree that if recommendations of this House to reduce fraud against the Community were accepted, the cost of the CAP would be reduced by something like 20 per cent.? That involves both the Commission and member states.

§ Baroness Trumpington
My Lords, very high figures have been quoted by newspapers; for example, £6 billion or 20 per cent. of the Community's budget. By its nature fraud cannot be reliably quantified but such figures are exaggerated. However, fraud is clearly a serious problem and must be tackled vigorously.