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Mr. Archy Kirkwood (Roxburgh and Berwickshire) : I am pleased to be able to take up the remarks of my hon. Friend the Member for Orkney and Shetland (Mr. Wallace). He is to be congratulated on his tenacity in keeping us in our places at this hour of the night to debate the fishing industry. I am sure that the Minister and the hon. Member for Glanford and Scunthorpe (Mr. Morley), the Opposition spokesman, will agree that it is a trying time for the industry in all its various manifestations.

We are in a hopeless mess : it is difficult not to be pessimistic about what is happening and what will happen over the next 12 months. We must, however, be as positive as we can. I think that my hon. Friend was right when he said--I echo his sentiment--that the ministerial team deserves credit for the advances that it managed to achieve against the terms of the scientific advice. No one should under-estimate, however, the uncertainties and the difficulties that the industry will face.

The catching industry will experience difficulties with the reduction in TACs. The Minister is aware that I am concerned about haddock and cod quotas ; fishing against a quota of 36,000 tonnes will be a dire prospect next year. Although the catching industry will experience difficulties, those experienced by the processing industry will often be greater. It will have to cast its sights ahead over the coming years and, like everyone else, put together investment plans for capital machinery. It will experience economic problems such as exchange rates and interest rates, which will put it at a disadvantage compared with its competitors in the European Community.

I do not know what can be done to assist the processing industry--the Government have no proposals. I recognise that the Minister lends a ready ear to problems. Indeed, his ear is chewed every time he visits a quayside in Britain. I do not envy him his task. Quayside markets are not only damp and wet, but it cannot be nice to get one's ear bitten off by people who are genuinely worried about their future livelihoods. But at least he has it in his power to give them some hope of help from the Government. The Government must recognise by now that they need help, if they did not know it previously. The processing industry must be given urgent consideration.

One of the most frequent arguments that the processing industry makes to me --I realise that against scientific advice this may be difficult--is that, if it had a rolling programme of TACs--if it knew, plus or minus 10, 15 or 20 per cent. over three or five years, what raw materials would be available for it to process--it could have more confidence when making investment decisions for the future. At present, all it has is a lottery.

The processing side of the herring industry became extinct under the seven- year closure, and it was impossible to revive it within a short period. The lesson to be drawn from that is that the processing industry must be given special consideration in the difficult and testing year ahead.

I have a constituent who has an interest in the boat building industry--the Minister kindly granted me an audience when we went into the detail of this earlier in the year. I have his interests very much at heart and in mind

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because he is a prominent member of the Conservative party ; he therefore deserves special attention. I say that slightly facetiously, but his substantial boat building company is in the port of Eyemouth. He is an important employer and his company provides an important service to the fleet not only in building boats but in refitting, refurbishing and reconditioning them. His prospects for orders are bleak.

I am disappointed by the Government's news that there is not to be a decommissioning scheme. If they had been more visionary, they could easily have produced a scheme that would not have exposed them to the kind of criticism that they received when they last produced such a scheme. It was subject to abuse. A figure of £45 million for the decommissioning scheme has been bandied about, and of course some of that money could come from Community funds. That £45 million is not an insignificant sum, it is substantial. I do not under-estimate the difficulties involved in finding such a sum, particularly when we consider the budgets available to the Ministry at the moment. If the Minister had gone back to the Treasury and argued for fresh money--even if it was not as much as £45 million- -he could have made substantial progress in taking some of the capacity out of the fleet. That would have offered some hope to boat builders, because they could then have taken on orders to build new boats equipped to carry out their tasks properly. At the same time, the decommissioning scheme could take capacity from the fleet, and we could move more readily towards the multi-annual guidance programme targets for 1992.

My stalwart Conservative constituent will regret the bad news. I will have much sympathy with him when I tell him that bad news ; it will give me no great pleasure to tell him that the Government could have done much more. No doubt my stalwart Conservative constituent will tell me the same thing, but time will tell.

I want to refer tot the points raised by my hon. Friend the Member for Orkney and Shetland about conservation. A package of conservation measures should have been put together some time ago. The Scottish Fishermen's Federation has been arguing for months, if not years, for the elements of a scheme which could have been up and running. I agree with my hon. Friend that that would not have been a painless scheme. It would have caused heartache and it would have been difficult to persuade the industry to accept it. However, we have lost much valuable time. There are opportunities and scope for Government action on conservation. The Government will be derelict in their duty if they do not move quickly in that direction. I am worried that, in the financial crises facing the industry in the short term, we may lose the valuable benefits derived from the share fishermen's scheme--a system of share fishing that is unique to Scotland. I know that the Scottish Office and the Ministry of Agriculture, Fisheries and Food are aware of the problems with that scheme. There is some constructive tension--I believe that that is the phrase--between the lead Ministry in England and the Scottish Office. I believe that the Minister recognises that share fishing in Scotland is a unique scheme which may be damaged by default if the Government make proposals inimical to its continued prosperity.

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The Government should consider very carefully what the Department of Social Security is doing to the income available to some of the members of the share fishing crews. Earlier today, I reminded the Leader of the House that the new change in unemployment benefit for part-time workers will have a severe financial effect on such crews. If a boat is tied up for servicing or because of inclement weather for four or five of the six-day benefit week and then it goes out and the crew earn more than £43 on a one day in the week trip, they will be denied benefit for the rest of that benefit week. That will prejudice them to the tune of £53.10 per crew member. One need not be a genius to work out that it is much easier to lie in bed for the sixth day and collect the £56.10 unemployment benefit than to go down to the sea in ships, do business in big and deep waters and then return to find oneself deprived of five of six days unemployment benefit.

The share fishery and other parts of the United Kingdom fishing industry have always constructively relied upon that system--they have not abused it --to support their income when boats have been laid up. The Government have under-estimated the impact of that change. Technical as it may sound, it will have a fundamental impact on available income.

When I first saw the social security regulations, I thought that share fishermen were exempt, because special provisions were deliberately and properly made for the industry. I am now told that that is not the case and that it will suffer as much as everyone else. It is not a matter of getting better lay-up schemes and trying to get compensation to the industry in other ways : we must be careful that the new regulations do not cause unforeseen and untoward difficulties.

The Government must quickly come forward with some ideas about the future for the catching sector, as well as for processing and boat building. I understand the Government's general free-market philosophy. The Minister would not have any difficulty persuading me about certain aspects of a mixed economy, free market and so on as they apply to the economy generally. However, my experience as a constituency Member is that there will be little stability in the fishing industry either now or over the next two or three years. It is a serious business for coastal communities that depend on fishing to generate a large part of their income. Fishing is a way of life. If the fishing industry goes down, it will be the equivalent of the Ravenscraig steel closure in Scotland.

The Government cannot wash their hands of the matter and stand back and let the market sort out the mess. If they do, they will be culpable of criminal neglect. There are available methods, but they will cost money. The Government must go to the Treasury and argue for the extra money. If not, the coastal communities that depend on fishing for their livelihoods will simply never forgive them. 11.56 pm

Mr. Elliot Morley (Glanford and Scunthorpe) : The hon. Members for Orkney and Shetland (Mr. Wallace) and for Roxburgh and Berwickshire (Mr. Kirkwood) outlined in great detail and very knowledgeably the problems being faced by their local communities, not only on the catching side but on the production and shipbuilding sides of the industry. Whole communities rely on the fishing industry, particularly in the parts of the

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world that those hon. Members represent. They have made many points with which I do not disagree, but I shall explore some of the issues that they have raised.

To be fair to the Minister, I recognise that the Government have had difficult negotiations in Brussels. I accept also that the maximum that we could expect the Government to negotiate is up to scientifically agreed levels. It is irresponsible to argue that there is a magic figure and that, in some way, we can exceed quotas. If we do not accept the best scientific advice available, there will be no fisheries.

It is important that we should know what steps the Government intend to take to ensure consistency of supply to the processing side of the industry. We need stability in the industry. When the fleet faces severely reduced quotas, we must ensure that consistency of supply is maintained. If we cannot maintain our supply from our own home fleet, we may have to look to third countries to make up the shortfall in raw materials. As the Minister is aware, that involves import tariffs. I should be grateful if the Minister would outline whether ways in which shortfalls of supply could be overcome were discussed in Brussels.

Like previous contributors, I am amazed that the Government are using a free market approach to decommissioning. At the height of advocating this free-market approach, the Government were giving out decommissioning grants as well as grants for building and improvements. As has rightly been said, the report of the Public Accounts Committee was not necessarily critical of the concept of decommissioning grants, but it rightly criticised the way in which the scheme was run, without any kind of targeting, planning or structure. I shall deal with the detail of that in a moment and suggest how it could be made to work better.

Conservation measures are vital. I should be interested to hear what was discussed at Brussels. The Scottish Fishermen's Federation and the National Federation of Fishermen's Organisations have made some helpful suggestions to assist the industry to get out of the crisis facing it at present, and I very much hope that they are taken seriously. Some of those suggestions have related to an increase in mesh size and to experiments with square mesh. I understand that a derogation has been given to the president of the NFO to experiment with square mesh with fishing nets that have a smaller mesh size than the 90 mm minimum.

The question of spawning grounds is worthy of consideration. Indeed, I discussed this with the Minister, the right hon. Member for Suffolk, Coastal (Mr. Gummer), who informed me that, on the basis of the scientific advice that he had received, restricting the catching of spawning fish would not necessarily improve the breeding stocks. While I do not want to quibble with the scientific advice that the right hon. Gentleman has received, by instinct I feel that, if there could be some restriction on fishing in spawning grounds when fish are spawning, that must be to the advantage of the stocks. I hope that the Minister will consider the scientific research that has been carried out on this.

I am sure that the Minister will be aware of the package of measures put forward by the fishermen themselves, which includes the limitation of extensions on nets to a6 m maximum. They also suggest that the diameter of cod ends should be reduced to prevent the killing of juvenile fish and suggest placing restrictions on the nets currently

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carried on board trawlers. They suggest making it an offence to carry nets of a different mesh size, and also a one -net rule to help to enforce conservation measures.

I should like to extend those suggestions and to ask the Minister to consider a regional fisheries policy, whereby there would be some protection for local fisheries, taking into account traditional and historic rights. I accept that, historically, fishermen have moved around the country to different fishing grounds, but some small comunities rely very heavily on their local fishing. I hope that some thought will be given to protecting them from the knock-on effects which might arise if the large east coast trawlers were unable to fish for white fish and moved to other fishing grounds or even switched to other types of fishing. I am thinking of prawn fishing and of the possible effects on the west coast traditional fishermen. I should also be grateful if the Minister would give some thought to the way in which the quotas are allocated and managed within the United Kingdom. I noticed from the current issue of Fishing News that Aberdeen's producer organisation managed to keep its fleet fishing right up to the year end by allocating its quota among all the boats in the organisation, divided across the year. In Scottish terms, Aberdeen seems to have been successful in managing its fishing quotas. Perhaps there are some lessons to be learned from the way in which it has done that.

Will the Minister consider suspending the licences of those fishermen who persistently break their quota allocation? I was interested to note that there is a court case in Scotland at the moment in which some fishing boat owners who do not belong to producer organisations are claiming as a defence that they cannot be prosecuted in a criminal court for exceeding the quota limits because those fishermen who belong to producer organisations are not prosecuted criminally but are disciplined within the PO. I hope that he will comment on that and give an assurance that an anomaly will not arise whereby people get away with ignoring the quota rules. The unacceptable discard rate of some fisheries is a cause for concern. It is tragic that some of the discard is haddock, which must be dumped back dead into the sea because the quota has been exhausted. Has any thought been given to organising the quotas to prevent that?

Norway has came out of the negotiations very well, increasing its total allowable catch by 2 per cent., while our fleets are suffering substantial cuts in Norwegian waters. I am concerned about the large proportion of whiting that has been transferred to industrial fishing, especially by the Danes. I have severe doubts about the justification for industrial fishing. I wonder whether it is a good use of the fish for industrial processing, especially whiting which can be used for human consumption.

Policing is important to ensure that our restrictions and regulations are obeyed. The number of boats that DAFS has available for policing has been cut from five to four. I hope that the Government are taking seriously the need to ensure strict policing of the quotas and to prevent the significant abuses which I do not think anyone would deny have occurred.

I can well understand why the Government are wary of a decommissioning scheme ; there is no doubt that the previous scheme was abused. Some 50 per cent. of the money paid out in that scheme went to just 15 ships, the average payment to each being about £500, 000. Some of those ships were put back into fishing to qualify for the

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100-day minimum fishing time required for a decommissioning grant. Some companies even bought redundant trawlers so that they could apply for a decommissioning grant.

I do not doubt that the previous decommissioning scheme was a failure. It was abused and, most importantly, all the money went to the trawler owners and not a penny to the deck hands and crew. If we are to consider decommissioning schemes, as I believe that we must, I hope that they will include compensation for crew who do not have shares in the boat.

In the past we have provided substantial funds for redundant steel workers, although I accept that that was partly paid for from EEC funds. However, we have also provided substantial funds for redundant dockers, for which no EEC funding was available. That was financed by the Government. In addition, there have been substantial payments in the farming industry, such as for set-aside schemes and various other forms of compensation. There is no reason why the fishing industry cannot be assisted by decommissioning grants and support during its present difficulties. However, I recognise that there is still a need for some grants for modernisation in certain parts of the country where the fleet is aging and where there is not the overcapacity which exists elsewhere.

The failure of the previous decommissioning grant lay in trying to operate an interventionist policy in a free market system. We cannot have both. Because of the restrictions under which the fishing community must operate, there must be some structure, planning, intervention and assistance. If we do not give the industry that assistance, there will be no industry left and the many people who rely on it will be thrown on the scrap heap. Yet with a little thought, support, intervention and planning, we can ensure that our fishing industry gets through this difficult period and prospers. I hope that the quotas, the conservation measures and the other structures will begin to work and that we shall once again have a thriving and prosperous industry.

12.9 am

The Parliamentary Secretary to the Ministry of Agriculture, Fisheries and Food (Mr. David Curry) : I am grateful to the hon. Members for Orkney and Shetland (Mr. Wallace), for Roxburgh and Berwickshire (Mr. Kirkwood) and for Glanford and Scunthorpe (Mr. Morley) for the moderate and balanced way in which they spoke. This is a serious subject. None of us is unaware of the gravity of the problems facing the fishing fleet in all parts of the United Kingdom. It is only reasonable that we should discuss these matters with the seriousness and intelligence shown tonight.

When the ministerial team negotiates, it does so for all parts of the United Kingdom and is conscious of the needs of all parts of the United Kingdom. While there may be debate on policy, as in all spheres, we present a solid front for the United Kingdom at negotiations. When we came out of the negotiations, we reported to representatives of fishermen from all parts of the United Kingdom who were in Brussels. Like the hon. Gentleman, who had the grace to say so, they recognised that the deal that we obtained was the best possible.

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We set out our priorities to the House before we went into the negotiations. They were to increase the total allowable catches to the levels that are regarded as the best buy, as it were, by the International Council for Exploration of the Seas. It gives a range of possibilities and then recommends a best buy. The best buy was to combine fishing opportunity with conservation. To a large extent, we achieved that aim although we did not quite do so on cod or whiting, we succeeded on haddock. That was a significant negotiating achievement.

We achieved an underpinning of relative stability. That is important both in principle and materially. We were most anxious that, as in the past, the taking of cod from Greenland should be exclusively a British and German fishery. We did not want the fisheries policy to be fractured by a departure from that tradition. That was a difficult negotiation, because some member states felt that they had historic rights in those waters and would have liked to get back into that fishery.

As hon. Gentlemen have said, we succeeded in having the Hague preference applied to haddock. The amount that that represents is 36, 280 tonnes. The hon. Member for Orkney and Shetland was almost exactly right in his estimate of the amount that would be made available to the United Kingdom by that application.

We also achieved some flexibility on western mackerel. There was no cut in the TAC. The amount that we can fish in the North sea was slightly reduced from last year's amount.

We came home with many of the principal elements on our shopping list but, as hon. Gentlemen have said, that is the beginning, not the end of the problem. The fact that we managed to push up the quotas and TACs simply means that we have reduced the scale of the problem that would have existed had the original proposals been adopted. The hon. Member for Orkney and Shetland asked me for some specific responses, which I shall seek to give. He said that full application of the Hague preference would have represented about 38,000 tonnes of haddock. In fact, we were able to obtain the same proportion as last year. That was the incremental amount that came to use from the Hague preference. We should have liked a larger amount, but we obtained as much as possible. The truth is that we obtained the same percentage as last year.

We managed to reduce the by-catch to Norway to 13 per cent. The original proposals would have left us with a rather higher figure. An allocation will go to other countries, too. The whiting by-catch takes account of the ICES estimates. The 1989 allowances had understated the amount of whiting taken in industrial fisheries. We were not happy with certain elements, such as the fact that the Norwegian take of North sea herring was 29 per cent. It became clear in the negotiations that we would not win on that, and we had to accept it.

In Brussels we defined the precautionary total allowable catches, TACs, analytical or non-analytical total allowable catches. Some of them have a bit of science involved--for example, those relating to Channel cod. We did our best to push up those TACs where we thought we were justified. We did not get as much as we wanted, but we got some way towards what we were seeking. We cannot disregard the precautionary TACs ; that would be the wrong route to follow. Our aim, as in other matters, is to produce a better science so that we can estimate the fisheries that are available.

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A number of Ministers have begun to get worried about the technical conservation measures. That anxiety was not apparent at previous meetings. They share our belief that such measures should be at the top of the agenda. A high-level group, effectively senior officials from the member states, will get together quickly and it will produce its recommendations by the middle of the year. Those recommendations will come to the Council in the form of proposals by the end of July. I suppose, being realistic about the way in which the Community works, the proposals will form part of a package discussed at the end of 1990. If accepted, the date for application of the package may be the middle of 1991. That is a realistic assessment of the timetable for introducing a new series of conservation measures. To suggest their earlier introduction would be over-optimistic.

We have produced a consultation paper, which is with the industry now and which is largely based on its recommendations. Hon. Members have already said that the Scottish Fishermen's Federation has had considerable input in that paper, as has the National Federation of Fishermen's Organisations, which represents other parts of the country. The key is to get better selective fishing and selective gear. It is worth reminding the House that the 90 mm nets have been in operation for a year only. Those nets are rather like string shopping bags : when they get heavy, the meshes tend to close. It is also important to consider square mesh. Certain technical problems associated with the physical operation of that mesh will be studied at our laboratories in Aberdeen.

It is also important to consider the role of the extension piece and, as the hon. Member for Glanford and Scunthorpe said, to study the meshes round the cod end. We need to study the selectivity of the gear carried on board. In other words, we must try to make the quotas fit the catch more effectively and to introduce much greater selectivity in the fishery.

We are committed by the agreement to a cut in haddock fishing. We shall contact the industry as soon as we can after the Christmas holiday to discuss the best way to proceed. One possibility is to restrict the number of days at sea. We shall discuss that with the industry and we shall keep an open mind. We would not want to close down the entire fleet for X days per month because, as hon. Members have already said, we must remember the processing industry for which continuity of supply is essential. It is important that the industry should be able to satisfy consumer demand.

Hon. Members have mentioned the decommissioning scheme, and it is important to spell out why we thought it was not the right course to follow. A decommissioning scheme takes out capacity and does not necessarily reduce fishing effort. One of the problems is that more and more fishing effort is made in chasing fewer fish. It is not simply a case of heeding the Public Accounts Committee's criticism of the previous scheme. We could have devised a scheme to overcome at least some of the problems earmarked by the Public Accounts Committee, but we did not feel that it would be value for money but would prove expensive for the amount of tonnage removed.

Another important factor is that we are still in the process of finding out how big the fleet is. The registration process is not complete and we are not yet certain of the fate of the famous quota hoppers. There are 20,000 tonnes of quota hoppers in suspended animation because we do not have the definitive European Court ruling. They could

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be knocked off our registers if, as we hope, we win the final ruling on quota hopping. We are in contact with Brussels about the implications of our decisions. We firmly hope that Brussels will understand our approach.

We believe that the answer lies in much better management. As I have said in my meetings around the country, if I had absolute truth at my disposal, I would be an archbishop, not a Minister--[ Hon. Members-- : "Hear, hear."] I am grateful for that. We are talking to the fishermen about various ideas we have--including capacity aggregation and entitlement aggregation--to see whether they will work. We need to explore the notion of individually transferable quotas to enable the fisherman to take more decisions about his investment capacity and requirement. Technical conservation is essential to this debate.

It has been said that we are launching the fisheries and the fleet on to market forces. We spend £18 million a year on fisheries protection and control, £15 million a year on marine fisheries research, and in the past five financial years we spent £56 million in grant aid on vessels and £17 million on decommissioning. That must be stacked up against a landings value of £400 million. Therefore, the amount of public money involved in the fishing industry, in relation to its gross domestic product, is considerable. There is no fear of the industry being thrown exclusively to market forces. The Government believe that market forces have a role to play, alongside the support which the Government give and the framework which the European Community inevitably provides for fisheries management. Subject to the Commission's approval, under the aids provision of article 92 of the treaty, we shall introduce a new grant aid scheme that will provide grants at a rate of 30 per cent. for all essential safety improvements. "Essential" means improvements necessary to comply with Department of Transport safety regulations. The back-up grants, to which the hon. Member for Orkney and Shetland referred, will be at the 10 per cent. level necessary to provide the national grant element needed to secure the EC grants for modernisation and construction. There is nothing new about that ; we already have the same arrangement for fish farming. When the fisherman succeeds in obtaining a Community grant, we will ensure that the complementary national grant is still provided.

Mr. Morley : Does the Minister accept that one of the objections put forward by the fishermen to the fact that the Ministry will not consider decommissioning grants is that a considerable amount of public money has been made available for modernisation and construction in the past? I realise that the construction element has been dramatically reduced, but what is wrong with the case for switching some of that money to decommissioning, bearing in mind the relevant point made by the Minister that a scheme could be constructed to get round some of his valid objections?

Mr. Curry : When we looked at the amount of money involved and what we are likely to get for it, we decided that this did not provide good value for money. We accept that the absence of a decommissioning scheme means that we shall have to look to the longer term with regard to targets. Every other decommissioning scheme proposed would also have failed to reach those targets which are fuzzy because of the uncertainties about the number of boats on the register and the quota hoppers. I am

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confident that we will be able to negotiate an effective target and that the measures mentioned in today's statement, which will be unveiled when we consider our consultations with the industry, will bring us into line to achieve those targets.

Mr. Wallace : It is clearly important that the fleet does not ossify. While it is necessary to take out some capacity, it is also important to have an up-to-date fleet. I am worried lest the 10 per cent. national grant, supplemented by the FEOGA grant, should lead to difficulties. Thanks to the efficiency of the Ministry and of DAFS, the national grant comes through quickly, but grants from the EC often take a considerable time to arrive. The implications for debt repayments and interest payments are obvious. I am concerned that what the Minister proposes will not allow the fleet to develop, with damaging effects on boat buildings and on the long-term age profile of the fleet.

Mr. Curry : We are willing to examine any proposals to accelerate the arrival of grants from the Community on time. The wheels of the Community, like the wheels of God, grind rather slowly. Preoccupation with avoiding fraud has tended to pile bureaucracy on to the system ; that is the difficulty.

If fishermen are allowed to take more of their investment decisions themselves and to decide how to handle their capacity more effectively, the way is cleared for a much more effective rationalisation of the structure of the fleet. We shall be discussing these ideas with the industry over the coming months.

This week, the Council of Ministers agreed to regulations that will provide aid for the marketing and processing of fishery and aquaculture products, and fisheries Departments will be drawing up a sectoral programme to provide a framework to set priorities for aspects of processing. Thus, there will be aid for this sector. I can understand the wish for stable supplies. While the idea of a rolling total allowable catch is attractive, it has drawbacks because the recruitment of young fish to the fishery can vary enormously from year to year. While stocks are low, fisheries are relying on single-year classes ;

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a rolling TAC would require setting TACs at low levels and not taking advantage of the years of relative plenty. I can see the attractions of the scheme, and if people come forward with valid ideas we are prepared to look at them, but we shall need to be seriously persuaded before we go down this route.

It is, of course, generally accepted that the fleet is too big. It is therefore difficult to see how we could encourage more boat building. The fleet will have to go through a period of rationalisation and we hope to harness market forces, in association with other elements that I have described, to improve quota management arrangements and speed up this process. If we can loosen the quota management regime and remove some of the restrictions on fishermen, we expect that successful fishermen will want to build new boats with new confidence--some of them, perhaps, in the constituency of the hon. Member for Roxburgh and Berwickshire. No doubt that will be, as he said, to the benefit of the Conservative party if the gentleman that he cited is such a dedicated follower of the Government.

I hope that I have covered most of the points raised tonight. We have two major priorities to help to get the fishing fleet in shape. First, we need a real policy on conservation. We are beginning to see a genuine earnestness about putting one in place, and we shall do all that we can to propel and encourage it, and to participate fully in the elaboration of these programmes.

At the same time, we need sensible and constructive quota management arrangements. I believe that we are in a position to start freeing up the system, which will enable that management to be much more effective. Finally, we need sensible proposals from the European Community, representing an intelligent balance between fishing opportunities and the interests of conservation. That balance was not present at the beginning of our negotiations ; it exists today and I hope that the lessons to be learned from the negotiations will be useful in future years so that, when we debate the fishing industry, we shall be able to say that it went through a period of great difficulty, that we recognise that we are a long way from the end of the road, but that a rational policy will facilitate a long-term future for an industry which, as all hon. Members have said, is vital to our coastal communities.

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Central and Eastern Europe

12.29 am

Mr. Michael Marshall (Arundel) : It is a great pleasure to have the opportunity of introducing this short debate on developments in central and eastern Europe. Anyone who reflects on the events of the past few weeks will appreciate that the House would be failing in its duty if it did not examine them before rising for the Christmas Recess. The difficulty of analysing such a broad canvas is that events are moving at a rapid pace and almost anything one says may be overtaken by events before the weekend. Another is the sheer scale of the subject. I hope that the House will understand, therefore, if I concentrate my remarks on two or three main areas and touch on points which do not always get an airing in this House.

The democratic development moving steadily through central and eastern Europe is evident in its various forms in the Soviet Union, Poland, Hungary, Czechoslovakia and Bulgaria. The trend is distorted only by the exception of the recent horrible events in Romania. I hope that my hon. Friend the Minister of State, Foreign and Commonwealth Office, will be able to comment on those events today, because I know that the Government reflect the feelings of right hon. and hon. Members in all parts of the House in expressing horror at what has occurred in Romania.

I returned on Sunday from a visit to East Germany and West Germany on behalf of the Inter-Parliamentary Union, accompanied by the hon. Member for Tooting (Mr. Cox), who I am delighted to see in his place, and the IPU secretary-general. During that visit, we explored not only recent developments in the two Germanies but ways in which this House might facilitate the process of dialogue both with existing parliamentarians and, perhaps more importantly, with the future politicians of East Germany who may be the making of the democratic development that we all want to see.

East and West Germany will be the main theme of my remarks, but I turn first to the background of the Soviet Union. As my right hon. Friend the Prime Minister has repeated on many occasions, the developments in the Soviet Union that we have witnessed could not have occurred without the personal involvement in and commitment to glasnost and perestroika of President Gorbachev. If he and the Soviets had not made plain their unwillingness to intervene militarily in democratic protest, and had not dissuaded its military prevention by the Governments concerned, events might have taken a very different turn.

The Soviet Union clearly has great domestic problems. One must try to understand and have sympathy with those who, in seeking to move from a highly centralised to a decentralised structure, are inevitably facing strains on their economy and political systems. What can we do at this time to help them? The problem is on such a vast scale that it is unrealistic to imagine that we can do much on a bilateral basis. That is why I warmly welcome the signing recently of the trade agreement between the EC and the Soviet Union. It is probably on a Europewide basis that more opportunities can be found to provide the economic linkage that is essential if democratic development in the Soviet Union is to continue.

Industrial linkage is a theme to which I shall return in respect of other parts of central and eastern Europe.

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Several British companies are playing an important part in that. One example is the recent joint venture between GEC and the Moscow telephone company, as part of the crucial objective of uprating the Soviet Union's telecommunications. I refer also to the work being done by Cable and Wireless--I remind the House of my interest in that company--in pursuing developments on the same lines.

Inevitably, much of our effort is directed towards wider co-operation with our western allies. That is certainly true of disarmament. Although we all have our separate perspectives, we must keep both the Warsaw pact and NATO in view when discussing the wider aspects of our relationship with the Soviet Union.

I know that the Minister has a special interest in space activity, and I believe that that, too, will play a part in both disarmament and other kinds of co-operation between Governments, in industry and throughout Europe. The current convergence of civil and defence technology will allow the satellites that give us weather information, help us to control floods and deal with drought, and carry out remote sensing and earth observation to monitor mutually balanced force reductions and, indeed, the whole peace- keeping process. I am glad to see this country once more beginning to reaffirm the wider, collaborative role of the European Space Agency. I welcome the recent agreement with the Soviets in relation to British cosmonauts, which will take effect in the near future--as, indeed, will the similar agreement with the United States about astronauts.

How can the West, and the United Kingdom in particular, assist the Soviet Union during the time it needs for development, not only economic but democratic? Let us consider specific examples of progress in other parts of eastern Europe. Many of us will have had a chance to see and appreciate the advances made in Hungary and Poland, which in some ways reflect what has been described as "goulash Communism" in Hungary, which lasted a decade or more, and the progress in Poland, going back to the remarkable work and courage of Solidarity in the early 1980s. Those two countries have experienced a relatively mature development of the democratic process ; in such countries, however, the winner picking the winner, as it were, may be of the best use in furthering glasnost and perestroika. If the link between democratic and economic development is seen to be working there, the Soviets may be helped to move along the same track. I applaud the Government's creation of a £25 million know-how fund for Poland. That was done at an early stage in the recent developments there because the Government saw an urgent need for help in such matters as food, management training and English language teaching. That determined an important principle--that the urgency of cases should be taken into account.

I am rather concerned about the view which is tending to gain ground, that economic aid should be related only to democratic development. I shall try to show later in my speech that in many instances democratic development is not possible until economic progress is made. While the former might be a nice ideal, it does not square with reality.

Bilateral effort has been important in Poland and I applaud it. I welcome the fact that, from 1 April, a similar fund of £25 million for Hungary will come into operation. It will help with the English language, for which one finds a thirst throughout eastern Europe, and with know-how,

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which will be useful. Both know-how funds have been used to assist sponsored visits and to arrange political and industrial exchanges. The political exchanges have provided opportunities for parliamentarians to meet and for visitors from Poland and Hungary to go to constituencies as well as to be involved here at Westminster. On the industrial side, however, we have some way to go. Many hon. Members were impressed by the case that Lech Walesa made for joint venture activity in Poland when he came here. He made a powerful argument and contrasted, somewhat ironically, the limited number of examples that he could cite involving the United Kingdom with the large number of bilateral exchanges with companies from the traditional enemy--the Federal Republic of Germany. In Budapest, an IBM official has been seconded to the United States embassy to assist with the detail of joint ventures.

To what extent can my hon. Friend the Minister assure the House that the Government are responding to such professional need in the growth of trade and investment in Poland, Hungary and the rest of eastern Europe? I hope that my hon. Friend will reaffirm that the effort to concentrate our efforts on the early success which has wider political significance attracts his and the Government's support.

I have already mentioned the Inter-Parliamentary Union visit to Germany. I cannot claim that a four-day visit gives a comprehensive view, but one cannot but be staggered at the lightning changes evident on both sides. It is only six weeks since the Berlin wall started to come down. This year alone, 700,000 East Germans have moved for permanent residence in West Germany. That process continues at a rate of 2,300 per day. Like the hon. Member for Tooting (Mr. Cox), I saw the flow continuing by the thousand.

Such is the regularity of the process that it is virtually becoming a normal part of daily life. It is almost unremarkable. It has, however, had a major impact on the East German economy. There is evidence of strain at all levels. When we talked to people there, we could not help feeling a great deal of sympathy and anxiety for many of them. I remember meeting a professor of medicine who is a leading activist in New Forum, which is perhaps one of the key groups in the emergence of new political thought and parties, who was grey with exhaustion because he had been involved in setting up political groups and trying to sustain the work of the medical department with which he was involved when many of its most skilled people had left for West Germany. That story is also true for Church leaders. Those who have been most active in promoting democratic change are now inclined to think that they would like to return to private life, but I foresee problems if the old faces appear under new party labels. As a leading official in the Federal Inter-German Ministry said, a bad winter, continued economic collapse and the failure to achieve early democratic growth will result in East Germans voting with their feet. That is a fact of life.

What attitude should the Government adopt? They should make it plain that they accept the inevitability of economic unification. It is apparent that West German industry will be streaming all over East Germany on the

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back of substantial Government assistance with infrastructure--road and rail links, the development of telecommunications and, in a wider context, anti-pollution investment, which is important to us all. West German political parties have daily contact with parties of the same name or those with which they are beginning to recognise certain links. Those political and industrial links are important in drawing the two countries closer together.

There may be a temptation to leave it all to West Germany, but that would be a fundamental mistake. It is clear from the talks that those of us who have visited East and West Germany have had with the Bundestag foreign affairs committee, with members of the IPU and with the Berlin Reichstag that there is a feeling that British involvement, a British lead in recognising the situation at this stage will have a much wider symbolism-- not just because of the old wartime battles between Britain and Germany-- which represents the sensitivity of German parliamentarians who recognise many of the old fears and resentments and want to assure the world and their western allies that they want the development of unification to have the support of their allies and they put Britain top of that list.

In a week when Chancellor Kohl and President Mitterrand are visiting East Germany, it is timely to ask how we can respond. We really should establish a know- how fund for the GDR. Sadly, I believe that economic strains will move towards pressures over food, just as in Poland. There are real opportunities to assist with language and management training. In addition the knowhow fund would be a valuable adjunct to the activities of our industrialists. I make no apology for raising that point of pragmatic self- interest. I have already mentioned the opportunities being exploited by West Germany. Clearly there is a feeling that a second German economic miracle is possible and that the extra market of 19 million people can be deployed to the advantage of Germany.

British industry also has a part to play. The tie-ups that have emerged in Europe in recent years--involving British companies which have particular alliances or formal partnerships with other European companies--may be the way forward, especially if those companies have West German connections. The recent Plessey-Siemens tie-up points to future opportunities for British companies through the West-East German connection.

As one reflects on the opportunities for the five traditional la"nder of East Germany to join the 12 current la"nder of West Germany, one thinks of the tremendous potential which must be involved in bringing together the Prussian and Saxon workers and work ethic with those of West Germany. That must result in a very powerful combination. If we wish to influence and be part of that development, we must be there in the early stages.

We have before us a chance to assist at the political level. We are talking about people in a political system who have no paper, no typewriters and no copying machines. They have had no experience of creating any sort of political organisation, of canvassing or of performing any such tasks.

In parliamentary exchanges and work such as the IPU and the Great Britain- East European Centre can perform, we can begin to offer our help, saying that while we may not have a perfect model here at Westminster, we can exchange ideas. We found that such exchanges were greatly welcomed. There is a great thirst for knowledge in

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western Germany. The grass-roots activity-- the chance to spend time with parliamentarians in their constituencies--is perceived as of equal value to taking part in the Westminster tradition, which is widely respected.

Looking beyond the immediate opportunities and developments, it is clear that major problems remain--in defence, in respect of the four-power agreement and over the Helsinki background--but I urge the Minister to accept the inevitability of economic unification, which is now under way, to confirm that the British Government and industry can play a part, and to move in parallel, as we approach elections in East Germany on 6 May, in making the political contacts which are of immense value.

No visitor to the German Democratic Republic can leave without having a clear recollection of the wall--that affront to western civilisation. One recalls what are called the steel woodpeckers and the tap, tap, tapping of the many people with hammers and chisels who, while getting mementos, in their own small way are helping to bring the wall down. The House can today send a message of support to all those who are working to bring the wall down. By our early initiative, we can show that we wish to use this opportunity to move forward towards the restoration of, in this case, the European community. 12.54 am

Mr. Tom Cox (Tooting) : It is a pleasure to speak following the hon. Member for Arundel (Mr. Marshall) because he and I, as officers of the IPU, were fortunate to be in West and East Germany and in West and East Berlin last weekend. As he said, we witnessed the enormous changes that have taken place in that part of Europe.

For the last 40 years, East Germany has been regarded as the most loyal supporter of hard-line Communism. It is surprising now to think that the people of that country are enjoying a feeling of freedom such as many of them have never known. While we welcome that, we must be aware of the problems and uncertainties that such changes can create, not only in Germany but throughout Europe.

It was made clear to us last week, as the hon. Member for Arundel said, that we in the West must ensure that free elections take place in East Germany, for there are still strong remnants of the old guard there. If given the opportunity, they will resurface, perhaps under some other name. And as we do all we can to encourage free elections there, we must not overlook the need for industrial development and prosperity in East Germany.

When we talked to people about the forthcoming elections--it was clear that they were enthusiastic about them--we found that they had no experience, understandably, of organising campaigns. I am sure that at election time we all, no matter what party we represent, complain about not having this and that. I have no doubt that we all say, "If only we had more equipment, the campaign could be run much more efficiently." We were told by East Germans that they have no equipment. For example, there would be enormous problems in securing small quantities of paper for election manifestos or addresses. There will be tremendous difficulties in mounting campaigns prior to the elections in May 1990.

As an officer of the IPU, I pay a warm tribute to the work that the union has done over a number of years. It became obvious during our visit last weekend that it is held in great respect in Europe and throughout the world. Many in East Germany look to it to help and advise

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up-and-coming young politicians and newly formed political parties. I am sure that the IPU will seek to do that, and that plans are afoot already. Our expertise must be made available to the East Germans, but I hope that the Minister will deal also with financial help. I hope also that all our political parties which have wide experience of campaigning will start to relate to fellow parties that are being set up in East Germany, so that parties that are respected in the United Kingdom can advise the new parties that are now emerging on what they have learnt over many years. If it had not been for the heroic resistance that was shown in October and November in East Berlin and other parts of East Germany, I am in no doubt that the old guard would still be in power.

On Saturday evening, we went to a dinner in East Berlin. Some of the members of the old guard were present, and it was amazing to listen to them. It became clear from questioning them that they still believed, after 40 years, that there was nothing wrong. I said to one of them, "When did you realise that things were wrong?" He replied, "Last October." I said, "What caused that realisation?" He answered, "The demonstrations which were taking place." I said, "If those demonstrations had not taken place, would you have realised that for the past 40 years you had been misleading the people of this country?" He replied, "No. We would still have been in power." It is only right that we ensure that the members of the old guard who are still around are not given the opportunity to regain power. Along with free elections, there must be continuing prosperity, even if progress is slow initially. In the absence of that, members of a population of about 17 million would start to walk across the newly opened borders to start to establish themselves in West Germany. That would create unemployment problems and social and welfare problems. We were told that there are signs already of inadequate housing. Such problems would start to cause a great deal of instability.

Much has been said over the past few weeks about the future of Germany. There have been calls for reunification--a unified Germany. In today's edition of The Times there are examples of the differing points of view. I am sure that hon. Members have seen the photographs of Chancellor Kohl in Dresden. The headline in yesterday's The Times read "Reunification fever greets Kohl's visit". Yesterday, the Russian Foreign Secretary, Mr. Shevardnadze, gave warnings in Brussels. The headline on his visit in The Times said "Fears on German unity spelt out by Shevardnadze". That is an example of the current dilemma.

We in the West must begin to respond and to help. I am receiving letters from my constituents saying, "Of course we welcome the new freedoms, not only for East Germans but for the people of eastern Europe--but specifically East Germans," but they express a fear of a united Germany. Hon. Members may say "Those days are long past," but I am sure that the Minister will agree that many people in Britain hold such fears. We may say, "Don't worry about it," but, as the hon. Member for Arundel and I saw last week, unless East Germans can foresee prosperity, calls for the reintegration of Germany will undoubtedly lead to a powerful Germany.

The hon. Member for Arundel mentioned the comments that were made to us last week. Fears were expressed that a severe winter in East Germany will lead to

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