§ Lord O'HAGAN
asked Her Majesty's Government:
What consequences the new arrangements secured by the Irish Government 1728WA at the EEC Council of Agricultural Ministers on 5th October will have for the British consumer and farmer, particularly in Northern Ireland.
§ Lord MELCHETT
The devaluation of the Irish Green Pound agreed by the Council of Ministers (Agriculture) on 4th/5th October has the effect of raising Common Agricultural Policy support prices in the Republic of Ireland. The system of monetary compensatory amounts (MCAs) is designed to prevent trade distortions; but given the problem of applying MCAs effectively at the Northern Ireland border, there was an incentive to smuggle livestock across the border to obtain the higher support prices applying in the Republic, thereby raising prices in Northern Ireland and putting employment in the Northern Irish meat plants at risk. However, on 19th October the Government announced the introduction of a scheme on the lines of the former Meat Industry Employment Scheme. Under this scheme, payments are made to farmers in respect of animals which they market for processing in Northern Ireland. This should remove the incentive to smuggle and should benefit both the meat plants and consumers.