HL Deb 02 July 2003 vol 650 cc882-5

3.8 p.m.

Baroness Miller of Chilthorne Domer

asked Her Majesty's Government:

In what ways they will ensure that the opportunities afforded by reform of the common agricultural policy result in United Kingdom consumers having increased access to fresh, quality United Kingdom produce.

Lord Whitty

My Lords, the decision to decouple subsidies from production provides a significant incentive for farmers to produce only what the market wants. Also, the cross-compliance provisions should contribute to improving the quality of agricultural produce. In addition, many of the domestic measures being pursued by the Government under The Strategy for Sustainable Farming and Food in England are aimed at strengthening links between processors, manufacturers, caterers and retailers, in order to reconnect the food chain with its customers.

Baroness Miller of Chilthorne Domer

My Lords, I thank the Minister for his Answer. Is he confident that the situation now where it is much easier to buy chocolate or chewing gum than an English apple will be reversed? Can he assure me that the extra money that the Government could take up under the second pillar will go into schemes for young entrants to encourage them perhaps to go into vegetable production, and that agri-environment money can apply to all types of agriculture, including orchards, soft fruit and vegetable production? In doing so, I declare an interest, as my brother-in-law is an apple producer—albeit cider apples. Will consumers benefit by having fresh quality produce available in a way that they do not have now?

Lord Whitty

My Lords, regrettably, under the previous and new systems, cider apples were never subsidised under the CAP. Nevertheless, the overall effect of the switch away from coupling to particular forms of products and the shift from pillar 1 to pillar 2 of a significant amount of money to provide for rural development, environmental outcomes and outcomes designed to bring farmers—co-operatively, in many cases—closer to their market, should enable enterprises producing quality food in this country to be closer to their customers, to be more efficient and to receive the support of the CAP and taxpayers' money in so doing, with a variety of schemes most of which could apply to most sectors of agriculture.

Lord Hughes of Woodside

My Lords, does my noble friend accept the proposition that there is no good, fresh produce available in the shops? My impression is that there is a great deal around and I hope that the change in the CAP will mean that there is more.

Lord Whitty

My Lords, it is true that there is a good choice of fresh food available. I think that my noble friend—I apologise; we are not yet in coalition politics—the noble Baroness was attempting to assert that this should help more of that fresh produce to be locally produced or produced in Britain.

Lord Roberts of Conwy

My Lords, is the overall cost of the new system greater or less than that of the old one?

Lord Whitty

My Lords, there is a small element of reduction in the total quantum. In total, the figures, and therefore the burden on the European taxpayer, as a whole, is not significantly reduced from the pre-agreed ceilings. Of course, beyond next year that money will have to apply to 25 countries rather than 15. In terms of both the burden and the benefit, there will be a reduction for the existing 15.

The Countess of Mar

My Lords, does the noble Lord agree that the onus is on farmers and growers to find out what the market wants from them? If Her Majesty's Government are to help them, it would be in terms of how to carry out market testing and the running of a business appropriately. Perhaps I may declare an interest again: we have had a lot of help from Business Link. Can I suggest that the money is put into Business Link so that it can help farmers with business management and market testing rather than having farmers receive direct grants?

Lord Whitty

My Lords, there is a place for both. Business Link and the Farm Advisory Service, which by and large Business Link has run, have helped farmers adapt in difficult times to spot additional business opportunities. For example, processing and marketing grants given to farmers individually or co-operatively have also helped. So I think that there is a role for both.

Earl Peel

My Lords, can the Minister acknowledge the advice given to him by his noble friend Lord Haskins that his department should be abolished?

Lord Whitty

My Lords, I have received no such advice from my noble friend. His report is due in a few months' time.

Baroness Byford

My Lords, the Minister will be aware that the Curry report encourages co-operation among farmers and farm producers. What assurance can the Minister give that the Competition Commission will not decide that those co-operatives have become too large?

Lord Whitty

My Lords, the competition authorities are at arm's length from (he Government, therefore I cannot speak for them. The rules on competition are, however, clear; namely, that people should not abuse their market position whatever their size or whether they are co-operatives, limited companies or whatever. The measures that the OFT has taken to explain the position to potential and actual farmers' co-operatives have achieved an understanding within the farming sector of what the limits to the market position might be and what would be regarded as an abuse. That has greatly helped in establishing co-operatives and other collaborative arrangements that do not transgress the competition rules.

Baroness Trumpington

My Lords, is the Minister aware that a noble Lord once said in this House that he had a friend who hired an aeroplane and flew over France, where he released thousands of parachutes that all said, "Every French tart needs an English Cox"?

Lord Whitty

My Lords, thankfully, until this moment, I was totally unaware of that. God knows what the French farmers made of it.

Baroness Byford

My Lords, to return to the answer that the noble Lord gave, we are now required to compete globally. The Competition Commission has tended to look at UK rather than global competition. Therefore, have the Government given any advice to the Competition Commission that it must look at the issue in a world-wide sphere rather than a UK sphere?

Lord Whitty

My Lords, the competition authorities make their own judgments on every case. They look at the appropriate market. I know that there has been some criticism at the small area of market that they have looked at in some cases, but they are operating on the same broad competition framework which is operated Europe-wide these days. There are no overall criteria for what constitutes the market. Those decisions are taken on a one-by-one basis. As I indicated, the competition authorities are now engaged in a process where they will inform potential co-operatives and potential collaborative ventures of whether there would be a problem were their structure to infringe certain market rules. It is—I repeat—the abuse of one's market position and not the size of one's market position with which the competition authorities are concerned.