HC Deb 24 January 1973 vol 849 cc180-3W
Mr. Charles Morrison

asked the Minister of Agriculture, Fisheries and Food whether he will make a statement on the outcome of the meeting of the EEC Council of Ministers on 22nd and 23rd January.

Mr. Godber

At the Council of Agriculture Ministers which ended this morning, we were able to take all the remaining decisions needed prior to the United Kingdom and the other new Member States adopting the common agricultural policy as from 1st February. It was agreed that, in view of the continued floating of sterling, prices and compensatory amounts for the United Kingdom in units of account will be converted to sterling on the basis of the average market rate for sterling during the first part of January rather than the officially declared IMF parity. This will ensure that prices in sterling terms will not be increased when we adopt the transitional arrangements.

However, because of the marked rise in world cereals prices since the arrangements were provisionally agreed in July, intervention prices for cereals in the United Kingdom—which set a floor for the market—have been increased in sterling terms by approximately £4 a ton over the figures agreed then. Given the current high levels of cereals prices, this adjustment will have no effect on the level of our market prices for cereals or cereal products. The compensatory amounts will be temporarily adjusted downwards so as to ensure that within certain limits they will not exceed the Community levy on third country imports. The compensatory amounts for processed cereals will be established in the management committee with the help of the coefficients used in the EEC levy arrangements.

We have agreed to accept the Community regime of production refunds for the manufacture of starch and glucose, on the understanding that, if, before 31st July 1973, there were to be a significant fall in world cereal prices, this arrangement would be reviewed by the Council.

The transitional arrangements for pigmeat, poultry and eggs were agreed upon, including provision for the compensatory amounts to be reduced following the re- ductions in those for cereals. For pig-meat, we secured agreement to maintain the bacon stabiliser until 1st June next. During this period, the compensatory amounts will also be phased so that, for pig carcases, the compensatory amount to apply in trade between the United Kingdom and the Six will be of the order of £40 per ton from 1st February, about £35 per ton on 1st April, reducing to about £25 per ton on 1st June, assuming that world prices remain at around current levels. I am satisfied that these arrangements adequately cover the interests of both consumers and producers. They should in particular safeguard against any immediate increase in the price of pork or bacon. Producers and processors can now plan ahead with confidence. As a further measure, I propose immediately to take steps to abolish the flexible guarantee adjustment to the pig guarantee.

For eggs and poultry, compensatory amounts have been agreed at levels well below those which would have resulted from the application of the co-efficients used for calculating levies. With current cereal prices, the amounts applicable from 1st February on trade between the United Kingdom and the Six and likely to be of the order of 1.3 pence per dozen for eggs and 0.8 pence per lb, for broilers.

We were also able to settle the transitional arrangement for sugar. The minimum price to sugar beet growers will be equivalent to the guaranteed price for 1972–73; the intervention price for white sugar on 1st February will be about £88 per ton exclusive of bagging and delivery. The Council agreed to the phasing out between 1st March and 1st July of the current special arrangement for subsidising the price of sugar in the United Kingdom. The arrangements for the import of Commonwealth sugar have been settled in such a way as to ensure that the full quantities of sugar covered by Protocol 17 of the Act of Accession can be refined and effectively marketed in the United Kingdom, and that the London Terminal Market can continue to operate on the present basis.

Finally, certain changes were agreed to the Community's import regime for calves and for young animals for fattening. The present temporary reductions in the Common external tariff, including the nil rates on these animals, will continue until the beginning of April. During this period, United Kingdom duties on beef will remain completely suspended.