Milk Quota (Hansard, 13 March 1990)

§ Mr. Gummer

We have been advised that the European Community Commission has formally approved our proposals for allocating the additional 1 per cent. of milk quota now available. These provide for quota to be allocated to the following categories of producer.

The first comprises those with tribunal awards which have not yet been granted in full. Small developers will have their allocations made up to the full amount awarded initially subject only to abatement for the cuts totalling approximately 4 per cent. imposed on all producers since the tribunal awards were made. This will benefit producers in Scotland and Northern Ireland; small developers in England and Wales have already been granted their full award. Unfulfilled exceptional hardship awards, which now remain only in Northern Ireland, will be dealt with on the same basis as small developers. Other development awards throughout the United Kingdom will be made up to a common level of around 77 per cent. of the initial allocation (after applying the abatement for across-the-board cuts) except in the minority of cases where a higher percentage of the award has already been granted. In the case of both development and exceptional hardship awards, quota will be allocated only to producers who have actually delivered milk during the period 1 April 1989 to 28 February 1990. This condition will help to ensure that quota goes to those milk producers who are most in need of it.

The second category of producers comprises those who occupy a family-type holding and for whom milk production constitutes a significant activity. My intention here is to give extra help to the family farms that are significantly smaller than average. The best practicable way of targeting this group is by allocating quota to all 193W producers holding under 200,000 litres of wholesale and direct sales quota. As with the developers and exceptional hardship cases, we shall exclude those who did not deliver milk in the first 11 months of this quota year. Also, since we are aiming at producers for whom milk production is a significant activity, those with under 20,000 litres of quota will be excluded. Within these limits producers will be given an addition of just over 3 per cent. to their current wholesale allocation, including temporarily suspended quota subject to an overall ceiling of 200,000 litres.

Allocations to family-type farms and to producers with outstanding tribunal awards will account for about 120 million of the 148.87 million litres available for distribution. In addition we intend to allocate a small share of the total to producers in the remoter parts of the less-favoured areas, that is, Arran, Bute, Coll, Gigha, Great Cumbrae, Islay, the Isles of Scilly, Kintyre south of Tarbert, Little Cumbrae, Orkney and Shetland. They will each receive an increase representing about 5 per cent. of their current wholesale quota.

Finally, I have earmarked 22.5 million litres for new entrants. The intention would be to allocate quota on loan. Eventually quota used in this way would be recycled to assist further new entrants. The Commission has, however, raised legal objections to the idea of loaning quota and the matter has not yet been resolved. This will not delay the laying of a statutory instrument before Parliament within the next few days to enable the majority of the quota to be allocated before the end of the present quota year.