§ Mr. PatnickTo ask the Minister of Agriculture, Fisheries and Food if he will describe the net effects on Supply Estimates of the decisions on agricultural prices for 1988–89.
§ Mr. MacGregorThe voted provision of £558.855 million for the Intervention Board for Agricultural Produce is not expected to be reached. Since the Supply Estimates were prepared a number of changes have taken place in market prices, levels of production, exchange rates and trade volume. These changes, which include a revised reassessment of the effects of earlier policy measures, are substantially greater than the £9.5 million estimated net Exchequer cost of the price decisions. The settlement of the 389W price negotiations (including changes to market management measures to offset the cost to the Community budget) is forecast to add £12.968 million to expenditure, mainly because of the devaluation of the green pound. Additional receipts are forecast at £3.464 million. These forecasts allow for a delay in Community funding of approximately two months (so that additional expenditure incurred after January will not be reimbursed until the 1989–90 financial year) and for the fact that the new cane sugar refining aid agreed as part of the price fixing is only partly funded by the Community.
A token winter Supplementary Estimate will be submitted seeking parliamentary approval for the provision of the cane sugar refining aid.