SHEEP VARIABLE PREMIUM (Hansard, 27 March 1991)

§ The Minister of State, Ministry of Agriculture, Fisheries and Food (Baroness Trumpington)

The reformed EC sheepmeat regime adopted in 1989 provided for sheep variable premium, which operates in Great Britain only, to be phased out by the end of the 1992 marketing year at the latest. In the negotiations on the review of the regime the United Kingdom secured the right to end the scheme before that date. Last summer, Ministers decided that variable premium should continue to operate in 1991 but that the arrangements for 1992 should be reviewed early in 1991.

My right honourable friends have now carried out that review, taking account of the views of interested parties. In the light of comments received and the experience of the phasing out process so far, we have concluded that the sheep variable premium scheme would be terminated at the end of the 1991 marketing year.

With the ending of variable premium, support to producers in Great Britain under the sheep regime will switch entirely to the sheep annual premium, which will no longer suffer a reduction to take account of variable premium. At the same time the clawback charge on exports of lamb from Great Britain to the rest of the Community will be abolished. From then on, support in Great Britain will be on the same basis as in Northern Ireland and the rest of the European Community, with a unified system for calculating sheep annual premium applying in all member states.

The Government are announcing the end of variable premium well in advance of the effective date to remove uncertainty about the future arrangements and to allow all concerned time to adjust to the new 63WA circumstances that will apply from the beginning of the 1992 marketing year. Sheep producers will then have the opportunities and challenges of a more open market. I am sure they will respond with the quality produce which makes British lamb such an excellent product.