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Column 466constituency. Those activities have been most successful, and have proved a lifeline for the Honda company. We are seeing it expanding production again as a result of co-operating in developing necessary new models in a competitive marketplace.
Of course, we have also heard the announcement that Toyota is going to an area which, is not, strictly speaking the west midlands, but it is just across the border. It has had a major impact on the west midlands, in that the vast concentration of component industries in the west midlands conurbation will take up the challenge and supply components not just to the Rover, Honda and Toyota factories but to Nissan, as many are already doing. I ask my hon. Friend the Minister to note that there are warnings that the European Commission is planning to jeopardise that.
As we all know, many member states have made voluntary agreements with Japan about the level of imports from Japan. It is significant that some countries--for example, France and Italy--have steadfastly refused to allow much of their markets to be penetrated by Japanese production. Of course, this will change as a result of the open market in 1992, because the European Community will have to have a policy towards Japan. The European Community's present scheme is called voluntary restraint agreements, whereby the total level of Japanese production or sales into the European Community will be no more than 12 per cent., rising to 16 per cent. At the moment it seems that that 12 to 16 per cent., which will grow over a number of years, takes into account Japanese production in satellite plants in Europe, which means Britain. That will be a severe setback for our motor and components industry.
If artificial restraints are placed on Japanese badge cars that are sourced and made in this country, it will be a black day for our car production. We need to be ever-vigilant to ensure that the European Commission does not pull a fast one on British industry now that we have got our car industry act together and can look forward to closing our present balance of payments gap. Although I look forward to its being closed over the latter part of the next decade, the fulfilment of that hope could be put in jeopardy unless we get the right voluntary restraint agreements which discount Japanese production from transplanted factories that have been set up in this country, or anywhere else in Europe. If we do not resolve the problem, much of the progress that we have enjoyed in the past few years in the motor industry, which is the powerhouse of our region, could be jeopardised.
One problem in the west midlands, although it is not confined to our area, is that of investment. It is essential that our industry invests in the new products and equipment that are necessary to taking up the challenge of 1992 and fighting off competition from wherever it comes. It seems that much of the current investment is confined to big manufacturers. About 22 per cent. of all English payments of regional assistance are made to businesses in the west midlands conurbation. That is extremely encouraging, but it is unfortunate that they are almost entirely restricted to large businesses.
Medium-sized and smaller businesses are not getting that assistance because they cannot raise the necessary money themselves to add to the amount of regional assistance for which they would qualify. They cannot raise that money because interest rates are higher than they would like. We have an opportunity to ensure that such
Column 467businesses invest, but the opportunity is running out. If we do not encourage them to make those investments and to take up the opportunities, we could be caught short in 1992.
I am not the Chancellor of the Exchequer, but now is the time to make our Budget proposals and to put forward our ideas. One way of targeting assistance to small businesses would be to introduce a small business interest rebate scheme. Businesses that invest could attract an interest rebate after their financial year end. If it was for no more than 5 per cent., the rebate would not cost the Exchequer a great deal, but it would be enough to encourage small businesses to make those vital investments.
The image of our area is not very good. About 65 per cent. of companies that have been polled reckon that the image of the west midlands is poor in a variety of respects. We must put that right. The hon. Member for Walsall, South (Mr. George) made some relevant remarks about the role of the old county council. It is true that it did some good work, and certainly the assets that it collected for itself in its 12 or 13 years of existence were huge. The residuary body is constantly handing out cheques to many authorities as it liquidates those assets. However, the county council played an important role as a co-ordinating body for the disparate schemes that were available throughout the west midlands county. The trouble was that it required a whole body of councillors to be elected and a bureaucracy to be set up. There are many schemes in the west midlands and many opportunities with training courses, investment schemes, urban development corporations and Birmingham Heartlands, which are all helping our area. We also have an inner-cities policy. However, what we really need is someone to co-ordinate these things. I do not believe that we need a separate body or council. We do not need to go to all the trouble of elections, because if the Government would allow it, our Members of Parliament from both parties could set up some regional body of Members of Parliament to act as the guiding body. Perhaps one of my Conservative colleagues could become a regional co-ordinator, or even the governor, of the west midlands. It is only a suggestion. We need someone to take the lead and to present the image of our area constructively. He could co- ordinate all the many agencies and target assistance where it is required. We would welcome that.
It is a question of image. We have a certain momentum and we want to keep it going. I am sure that, given the opportunities, industry in the west midlands will rise to the occasion and our prosperity will continue.
Mr. Gerald Howarth (Cannock and Burntwood) : My hon. Friend the Member for Birmingham, Northfield (Mr. King) has made a typically robust and helpful speech, as he did once before. On 25 June 1983, he introduced a similar debate on the economy of the west midlands to that which my hon. Friend the Member for Nuneaton (Mr. Stevens) has introduced today.
I made my maiden speech in the 1983 debate. Hon. Members on both sides of the House contributed to that debate, but the circumstances of the west midlands then were very different from those which prevail today. That debate was characterised by accusations from the
Column 468Opposition that the industrial outlook in the west midlands had never been so bleak. The hon. Member for Birmingham, Erdington (Mr. Corbett) said :
"I hope that neither the Minister nor Government Back Benchers will claim that they can now see light at the end of this dismal tunnel. There is no real prospect of that--only of worse."--[ Official Report, 25 June 1983 ; Vol. 46, c. 892.]
The hon. Gentleman, unfortunately, is not in his place tonight, but I hope that he would be the first to accept that he was wrong. My hon. Friends have tonight shown him to be wrong. Even the hon. Member for Walsall, South (Mr. George), who takes a rather more pessimistic view than my hon. Friends and I do, would agree that the evidence overwhelmingly shows that there has been change.
That change is reflected in the unemployment figures. In the west midlands in 1983 unemployment stood at 15 per cent.--in November 1989 it was 5.8 per cent.
Mr. Howarth : It would have been lower than 15 per cent. in 1979, but it would not have been lower than 5.8 per cent. In the Walsall travel- to-work area, which affects both my constituency and that of the hon. Gentleman, the unemployment figure has fallen from 17.5 per cent. to 6.3 per cent.
Those figures show the change. The economic foundations laid in the early 1980s have paid off with dividends. There is no longer any land in my constituency available for development. It has all been taken. New industries are locating to the west midlands. Recently, a garden furniture manufacturing company moved its production facilities from Jutland, a high- cost area in Denmark, to the west midlands because that is the best place to locate. Indeed, it has moved to Cannock in my constituency.
In the debate in 1983, I said that people had to be lean and hungry. I referred to a company which had no receptionist, merely a telephone in the entrance foyer with a sign saying, "Pick up the telephone and ring 0' for inquiries." Today that company, Albion Pressed Metal, at the gateway to Cannock, employs more people than ever in the automotive industry. It is proving highly successful and won a major training award this year.
I will take up the point made by the hon. Member for Walsall, South about the private sector. The railway line to which he referred runs into my constituency, and I pay tribute to Staffordshire county council for bringing forward that railway project. It has not done much for the shops in Hednesford, however, because people now want to shop in Walsall rather than locally and the train helps them to do so.
Although there are no pits in my constituency, many miners live there. Despite the dramatic cut in employment in the coal industry, both Littleton and Lea Hall collieries have thrived, producing record outputs week after week. I pay tribute to the miners for what they have done.
Another subject of my maiden speech was the Cannock community hospital, for which people of all parties campaigned for more than 50 years. This wicked Tory Government who do not care about health care are providing the £18 million to build the Cannock community hospital which, it is hoped, will open in 1991.
Unquestionably, we face some difficulties. I salute my right hon. Friend the Chancellor of the Exchequer for his
Column 469recognition of the role of interest rates and the fact that there is work to be done to ensure that British manufacturing industry, about which we all care, is able to compete internationally. If there is one message that I wish to convey to the House tonight, it is that it is vital that we in the west midlands do not talk ourselves into a recession. In my discussions with manufacturing and other industries, few people tell me that they are not doing well, but they are worried about future business confidence. We owe it to them not to talk down the prospects for British manufacturing industry.
I conclude on a personal note. In the past 36 hours, I have shared with my colleagues in the west midlands the tragedy of the loss of one of our colleagues there, the former Member for Mid-Staffordshire, John Heddle. I hope that you will not think it amiss, Mr. Deputy Speaker, if, as the hon. Member who now represents part of the constituency that my hon. Friend so ably represented from 1979 to 1983--Burntwood--I pay a small tribute to my late hon. Friend. He was a most dedicated, enthusiastic and kind Member of Parliament who will be remembered with affection and gratitude not only by his own constituents but by those of my constituents whom he represented so ably between 1979 and 1983.
Mr. Richard Caborn (Sheffield, Central) : As only a short time remains to debate this matter, I shall curtail my remarks. I thank the hon. Member for Nuneaton (Mr. Stevens) for initiating the debate. His speech was constructive but I detected in it, as in the speeches of other Conservative Members, a little anxiety about the future. He referred in passing to possible structural weaknesses in some of the developments in the west midlands.
When I was given the job of responding to the debate, I looked up some of the economic and industrial indicators for the west midlands. I was surprised at the depth of the recession between 1979 and 1983. The area suffered probably one of the greatest declines in employment of any region and experienced a near collapse of its manufacturing base. A massive 21 per cent. of companies were lost in that period. In that four-year period, more than 250,000 jobs were lost in manufacturing industry. That was a massive and unmanageable loss, which created many problems.
The turnround of the past three years has been referred to this evening. One must ask whether it was due to development of the infrastructure and sustained growth or was in response to a boom. That question gives rise to some concern. The manufacturing statistics show that the upturn experienced from 1986 to 1989 does not bring the sector back to the level of 1978 ; there is still a long way to go. One must accept that the services industry has mitigated the rate of unemployment. There has been a rise in activity in that industry.
Much has been said about investment. It is true that the west midlands has benefited from 20 per cent. of recent inward investment in the United Kingdom--investment in the region has increased by a factor of four. In the main, however, the investment stems from buy-ins, which means that it is equivalent to zero investment. Although I do not want to diminish the importance of inward investment, one must decide whether it is new investment or a buy-in
Column 470and therefore a zero gain. It is also interesting to note that the west midlands is lagging behind the rest of the country in terms of its contribution to the growth in GDP experienced since 1981. GDP per head in the west midlands remains 10 per cent. adrift from the rest of the country. In 1987-88, the rate of investment in the west midlands was 10 per cent. below the United Kingdom average. The hon. Member for Nuneaton referred to training, but since 1979 the number of apprenticeships in the west midlands has fallen by 70 per cent. Of all the figures quoted, that one has the most serious implications for the region. The hon. Gentleman referred to turners and millers, but if we do not train them they will not be available. It is worth assessing how the west midlands will fare in 1992. We usually compare the region with Yorkshire or the south-east, but it is important to compare it with the European regions. I have studied the GDP per capita of the la"nder of West Germany. Our best region in terms of GDP per capita and productivity growth does not even match the worst of the la"nder. The other interesting factor is the way in which economic development and the subsequent benefits have been distributed in West Germany. In the United Kingdom the south-east is over- heating while the northern regions are under-utilised. The tax regime at the federal and la"nder level acts as an equaliser. Therefore, the economic benefits are distributed across Germany and the country takes considerable advantage of them. A study of the economic indicators for West Germany and France show that the west midlands is at a major productive disadvantage.
The Henley forecasting centre has made a study of the expected growth of the west midlands from 1988 to 1995. From the data fed in it appears that the region will grow at a rate of 2.6 per cent. of GDP per annum up to 1995. That means that it will lag behind France and West Germany, which will become our major competitors. I agree that we should not talk down the west midlands or any other region, but we must be realistic about what things will be like post 1992. Most people are reaching the conclusion that we have a major structural weakness. That weakness is apparent from the role of venture capital, and the attitude of the financial institutions to the manufacturing base. Research and development is under-funded and unco- ordinated, although I accept that the science parks, to which reference has been made, are a positive development. Our transport infrastructure is also weak.
The greatest weakness, however, is the tendency to pump ever more resources into the south-east. We heard recent evidence of that from the Government. We are to spend billions to try to relieve the congestion in the south- east. The Government should heed the suggestions of their hon. Friends tonight and should follow an interventionist policy to attract development away from the south-east to the midlands and to Yorkshire. We should look at the major structures, particularly the infrastructures, where that development can take place.
It will be interesting to hear what the Minister says in his reply because, apart from one, all the speeches, from both sides of the House, have been critical--sometimes constructive--of the Government's policy towards development in the regions. That is true for not merely the west midlands, but for most of the midlands and the north. An overhaul of the policies for the regeneration in the
Column 471regions is needed. The Audit Commission's report which was published in the middle of this year said that the patchwork quilt of grants was totally unco-ordinated and now so complex that even businesses could not understand what they were being offered. The Government are in a hell of a fix. Unless something is done about these weaknesses in the near future, 1992 will expose them even more.
The Parliamentary Under-Secretary of State for Industry and Consumer Affairs (Mr. Eric Forth) : The time left to me is short onlbecause of the enthusiasm of hon. Members to participate in the debate, for which I am grateful. I pay tribute to my hon. Friend the Member for Nuneaton (Mr. Stevens) for initiating the debate. I fully associate myself with the remarks made by my hon. Friends about the sad loss of our former hon. Friend the Member for Mid-Staffordshire, Mr. John Heddle. He will be greatly missed in the House and in debates such as this. This is an appropriate time for us all to remember him, which we do.
I shall attempt, but inevitably fail, to deal with even a small number of the points made by all those who have participated in the debate. A theme ran through the speeches of Conservative Members. They recognised not only the great difficulties which occurred in the west midlands in the early 1980s--those of us who lived through them remember them well and will probably never forget them--but, equally, what has been done by people in the west midlands to regenerate the area, pick themselves up and get on to a completely new footing. It is important for us all to recognise that.
It was a little uncharitable of the hon. Member for Sheffield, Central (Mr. Caborn) to talk, as he often does--I have listened to him for many years with varying degrees of pleasure and often desperation--about grants, redirections and interventions such as we had in the bad old days. What both the hon. Member for Sheffield, Central and the hon. Member for Walsall, South (Mr. George) said was a sad reflection of the fact that, when looking back to 1979, they could talk about employment levels, but not productivity or profitability levels and the ability that west midlands' industry now shows in competing with the rest of the world. We all know that it could not do that in 1979. That was substantially the reason why we went through what we did in the 1980s.
I do not want to fall out, on this of all occasions, with my hon. Friend the Member for Birmingham, Selly Oak (Mr. Beaumont-Dark), but I must reflect for a moment on an observation that he made. He made a number of interesting observations and a teasing reference to the fact that capitalism must move. I look forward to a new philosophy of capitalism--I do not know whether it will be known as Darkism--and I hope that my hon. Friend will elaborate on his thoughts on some future occasion.
My hon. Friend said that the fall in the sterling exchange rate parity had been an important factor in the improvement of our export performance. That is stating the obvious, and there is nothing wrong with that, but it leaves one reflecting on how the Japanese and the Germans have managed to export spectacularly successfully over the strengthening exchange rate parity of the yen and deutschmark. That suggests that the answer is not
Column 472necessarily exchange rates, important though they may be. It is more fundamental. It may lie in productivity differences, for instance.
The hon. Member for Sheffield, Central was keen to draw parallels with the Federal Republic of Germany, but it is significant that that country's labour force has been prepared year in and year out to accept pay increases related to productivity and performance. One of the key differences over the years between this country and Germany is the fact that even now we are claiming and often awarding ourselves pay increases averaging 9 or 9.5 per cent. which none of us could remotely imagine were related to economic performance or productivity.
Mr. Beaumont-Dark : I very much hope that we are approaching Darkism, which will mean a new age of light. Does my hon. Friend agree that one of the other great differences is that manufacturing industry in the midlands pays 18 per cent. for money, while industry in Japan pays 5 per cent. and industry in Germany 7 per cent.? If we had that advantage, we should really move forward.
Mr. Forth : I accept what my hon. Friend has said, but there is a danger of becoming involved in a chicken-and-egg argument. My hon. Frend understands better than most the relationship between the level of interest rates in a country and its international competitive position, which in turn is related to the other factors that I have mentioned. I well recognise the strength of feeling expressed in the debate and the problems caused by high interest rates, although the latest figures suggest that investment in the west midlands and throughout the country is holding up extremely well. That is encouraging.
I cannot deal in as much detail as I should like with the comments made by the hon. Member for Walsall, South. The best that I can say is that I shall endeavour to pursue his point about compensation to his local businesses. That is a classic example of the difficulties inherent in seeking to create what he described as a much-needed local improvement of infrastructure. I should appreciate it if the hon. Gentleman would let me have the details, and I undertake to have the matter looked into.
The hon. Gentleman mentioned in passing that he wanted subsidies for rail. Where will the money come from? It is all too easy to ask for subsidies, but the Government have tried to keep down tax burdens, both corporate and individual. We have enjoyed much success in doing that, but it inevitably means that we cannot pay the sort of subsidies that we would like.
That brings me in one leap to my hon. Friend the Member for Birmingham, Northfield (Mr. King) who, as ever, was upbeat and optimistic, as was my hon. Friend the Member for Birmingham, Yardley (Mr. Bevan) who, typically, told us how things were looking up. He gave many examples of the great strengths of the region. Those who, like me, have the privilege of representing a constituency in the west midlands want to ensure that the world knows that the region continues on the up and up and that business is attracted to the area. We do not always need bribes and subsidies to bring it in, either--the region is a good place to be and in the end that is the best and only good reason for investing there on a permanent basis. I slightly regretted that my hon. Friend the Member for Northfield departed from his usual robust attitude when discussing a small business interest rebate scheme. I hope
Column 473that my hon. Friend will reflect on it and return later with details, such as how small the business would have to be, at what point the scheme would be triggered, whether there would be limitations on it, where the money for it would come from, what the rules for it would be, and so on. I must tell my hon. Friend, with as much generosity and friendship as I can muster at this time of night, that such a scheme-- [Interruption.] --which is getting Opposition Members so excited is easier to suggest than to implement. I look forward, perhaps in the privacy of another part of the building, to hearing how my hon. Friend envisages the scheme working in detail. Time has run out, but the debate has been useful and productive, not least for those right hon. and hon. Members who take a pride in the west midlands, what it does, and what it stands for. The region has weathered great difficulties and made enormous adjustments, and it has shown itself capable of making the adjustments so necessary for the future, with the imminent arrival of the single European market. We can take pride in the fact that our region stands tall and aims to succeed with the minimum of help and intervention because it knows what it wants to do and will continue to be very good at doing it. In that spirit, I thank my hon. Friend the Member for Nuneaton for allowing the House to debate the west midlands.
Mr. James Wallace (Orkney and Shetland) : I chose the broader subject of the United Kingdom fishing industry for debate rather than concentrate on particular crisis areas, because I hoped that that would allow right hon. and hon. Members from other parts of the country to reflect the concerns and wide geographical interest that were evident not only in last week's debate on the fishing industry but when the Minister of Agriculture, Fisheries and Food made his statement earlier today, responses to which were made by right hon. and hon. Members representing constituencies in Cornwall, Northern Ireland, the south of England, north- west Scotland and the east coast, as well as by myself.
I thought that it would be useful, following the meeting of the European Council of Fisheries Ministers, to have a debate in addition to a statement so that the House can discuss critical issues that were the subject of negotiations at the Council. I hoped that such a debate would allow right hon. and hon. Members to flush out the Government's proposals for the industry's future.
I am grateful to the Parliamentary Secretary to the Ministry of Agriculture, Fisheries and Food, the hon. Member for Skipton and Ripon (Mr. Curry), for attending this debate. It is not beyond the bounds of possibility that it could have taken place in the middle of the night and that the Minister might have already spent the two previous nights negotiating. I understand that he managed a reasonable amount of sleep last night, but spent all Monday night at the negotiating table.
It will not be surprising if the debate focuses on the outcome of the Council's meeting and on the other matters that the Minister mentioned in his statement this afternoon. When the House debated fishing last Thursday, there was broad agreement that Ministers should go to Brussels with the object of negotiating the maximum total allowable catches consistent with the scientific advice that the European Commission had received.
We knew that that would not be an easy task, because, for some reason still unexplained, the Commission, in its bilateral negotiations with Norway, initialled an agreement that set TACs for haddock and cod in particular at levels below those recommended by scientists.
Many right hon. and hon. Members, and particularly those representing fishing constituencies, know that, while it is difficult to persuade fishermen to observe TACs based on scientific recommendations, it is almost impossible to persuade them to observe TACs founded on some unexplained negotiating position adopted by the Fisheries Commissioner, Mr. Marin.
Fishermen will inevitably question the basis on which many scientific recommendations are made, and it is important not always to accept such advice as holy writ. Nevertheless, there is overriding concern to comply with such advice. There is genuine concern that haddock stocks in the North sea are reaching a critically low level, and the people working in the industry recognise more than anyone else that its future depends on taking a responsible attitude to conservation today.
I believe that the team representing the United Kingdom's interests achieved what was, in the circumstances, the best possible deal on TACs. As I said in response to this afternoon's statement, I feel that credit should be
Column 475paid where it is due. The Minister, however, would be one of the first to recognise that the deal, although it was the best possible, was not a good one. The TAC for North sea cod, haddock and whiting in 1990 will be 110,000 tonnes, compared with 155,000 in 1989. That is a substantial cut, especially in view of the drastic reduction in the 1989 TAC from that of 1988.
I do not want to be accused of carping, as another hon. Member was this afternoon by the Minister of Agriculture Fisheries and Food--I do not know whether the pun was intended--but, as Mr. Speaker invited us to leave the detailed questions until this evening, I should like to deal with some now. I understand that, following the Ministers' success in invoking the Hague preference, the United Kingdom allocation of the North sea haddock TAC of 50,000 tonnes will be 36, 300 tonnes. Prior to the negotiations, the Scottish Fishermen's Federation had estimated that, if the Hague preference was successfully invoked, the United Kingdom share would amount to some 38,800 tonnes. Can the Minister explain the apparent shortfall of 2, 500 tonnes? Hon. Members may say, "What is 2,500 tonnes?", but with our TACs as low as they are it becomes a significant amount. Can the Minister tell us whether the 50,000-tonne TAC includes an allocation to Norway of a 3,000- tonne by-catch? If it does, can he explain why that is much the same as the 1989 figure? As a proportion of the total allowable catch, the by-catch figure was much lower in the current year. Why, when the TAC has been so drastically cut back, has the haddock by-catch not been similarly cut?
Perhaps the Minister can also tell us why, although there was a reduction in the industrial by-catch of whiting amounting to some 20, 000 tonnes, the whiting by-catch--which I understand to be 50,000 tonnes--is so much higher than the 20,000-tonne allowance for the current calendar year. I think that all hon. Members would agree that most fishermen fish for produce that will end up on the consumer's table, not for industrial purposes, and it is a source of mystery to many that the by-catch has shot up so much.
As for pelagic species, I welcome the flexibility that resulted from negotiations on mackerel in north Scottish waters, which will give much- needed help to the industry. That was, I think, one of the toughest parts of the negotiation, and a very satisfactory outcome was achieved--although I understand that again the TAC is lower. The Minister shakes his head : I welcome that reassurance.
This year, after many years of pressing, Lerwick in Shetland was given limited designation as a transhipment port for a certain amount of mackerel in September-October. That amount was used up very quickly, and it will come as no surprise to the Minister or to his Scottish Office counterpart that we shall try for more.
As some of the stocks are caught towards the east, it makes good sense, not only in commercial terms but in safety terms, for boats to go to the nearest port--which in many cases is Lerwick--rather than undertaking the longer and, in adverse weather, more hazardous journey to Ullapool.
The Commission conceded a 29 per cent. share of North sea herring to Norway when, if the current allocation agreement was followed, having regard to the spawning stock biomass, the share should have been only 25 per cent. This seems to have slipped through. I question the apparent generosity to Norway, which does not seem to have been explained. Why do negotiations have to be
Column 476concertina-ed into a short time at the end of every year? The Norwegians can always hold a gun to the Commission's head because they know that it has to present proposals to the Council of Ministers in the second or third week in December. This year, some unsatisfactory arrangements were made which I am glad are to be renegotiated. Is it not possible for the negotiations with Norway to start earlier, so that we do not have this crisis period every year? In his statement this afternoon, the Minister did not say anything about precautionary TACs on the north-west coast of Scotland for monkfish, megrim and plaice. They are based not on any scientific case, but on historical fishing. It is claimed that, for a number of species, not least monkfish, the status quo is unrealistic. The value of monkfish is great, and if the fleet is denied opportunities to fish for haddock or cod in the North sea, it might get some compensation by fishing for monkfish on the west coast. I should be interested to hear what negotiations there were on precautionary TACs. There will be disappointment that no great increase, if any, has been announced.
The sacrifices that are demanded of our fishermen in the next year as a result of these drastic reductions will be for naught if the vast volume of dead cod and haddock, especially juveniles, are thrown back into the sea after the TACs have been fully fished. Discard is a subject which everyone in the industry to whom I have talked recently has mentioned.They are no longer allowed to fish for haddock, but it is inevitable that, if they are fishing for other white fish species, they will catch a large volume of haddock which they are obliged to throw back into the sea, although dead. That seems almost counter-productive to establishing conservation by TACs.
If TACs are to be effective as conservation measures, they must be backed up by others. I welcome the Minister's announcement today that the Commission has committed itself to produce proposals for further technical conservation measures by the middle of next year. The Scottish Fishermen's Federation can claim to have set the ball rolling. It has given a responsible lead with a package of measures which it proposed much earlier in the year. Every opportunity should be taken to build on that co- operative approach. I should be interested to hear what kind of conservation measures were considered at the Brussels meeting.
There should be tougher and simpler enforcement rules to give proper effect to TACs. We must ensure that there is adequate funding of fishery protection vessels. Can any of the measures that have been proposed be introduced by the Government for United Kingdom waters ahead of agreement with our Community partners? It may be that we can make some advances towards more effective conservation, at least in local waters.
All those who know the industry accept, and the Minister of Agriculture, Fisheries and Food repeated today, that conservation measures are tough. They are not easy, but the industry accepts the need for them and has put forward measures only after considerable negotiation. Nevertheless, they have been proposed by the Scottish Fishermen's Federation with support from the National Federation of Fishermen's Organisation. The Government should build on that spirit of co-operation in the industry.
Another suggestion which was not made by the industry but which may be worth considering is the possibility of identifying areas where spawning grounds or juvenile stocks predominate where it would be possible to
Column 477have a closed season during some parts of the year. That would be bound to cause some controversy. Last week, I asked one fisherman whether it was a worthwhile measure, and he said, "If you propose it, all hell will break loose. You will be roundly criticised, but those who criticise you will go home and say, That guy is talking sense.' " Proposals to close off fishing grounds are always controversial, but, given the crisis in some North sea stocks, we must consider such possibilities.
Measures to conserve stocks will be defeated if there is too much capacity chasing limited stocks. The only effective solution is to reduce capacity through a decommissioning scheme. I have had no other suggestion which can meet the scale of the present problem. Many people recognise that decommissioning is the only way to achieve a significant reduction.
Clearly there will be a reduction in fishing opportunity. In return for a worthwhile success in getting the Commission to drop the two measures it had proposed for the management of our national fishing quotas, the United Kingdom Government have been asked to submit by the end of January proposals regarding the management of the reduced quotas and methods to reduce the fishing effort. I would welcome from the Minister a timetable of negotiation with the industry and proposals for meeting that requirement from the Commission. Undoubtedly, he will need the co-operation of the industry, but how does he expect to get it, considering that this afternoon's statement slammed the door on the proposal that the industry has supported for so long?
The statement said nothing about a temporary lay-off scheme, although that may have been included in the blanket dismissal of any form of subsidy. In the past, a temporary lay-off scheme has not been considered a particularly suitable or effective way of solving the industry's problems, not least because of the strict rules that have to be met and the relatively small sums of money provided for complying with the requirements. At present, almost anything would be welcome to ease the financial burden that inevitably will fall even harder on the industry. As other countries have managed to top up their decommissioning grants, is it possible for the Government to top up temporary lay-off schemes and make them financially worthwhile to implement and give boats over 18 m long at least some temporary respite?
Last week, the Secretary of State for Scotland poured cold water on the idea of a decommissioning scheme by quoting the criticisms of the National Audit Office and the Public Accounts Committee. He asked how it would
"reduce the amount of fishing effort? In its 1987 report the National Audit Office questioned whether the removal of vessels under the earlier scheme did anything to relieve the difficulties of the fishing quotas that were under pressure. It would be difficult to target a scheme properly, as it is difficult in such circumstances for the Government to intervene effectively and precisely in an industry with so many active participants".--[ Official Report, 14 December 1989 ; Vol. 163, col. 1246.]
This afternoon the Minister of Agriculture, Fisheries and Food again used the excuse of the PAC as a reason why decommissioning might be inappropriate.
In fact, the report of the PAC made it clear that the PAC did not actually reject all decommissioning grants
Column 478but, rather, noted that member states in 1986-87 were given options as to how the decommissioning scheme should be introduced. The report said :
"MAFF decided to introduce a regulatory approach, with provision for the automatic payment of a flat-rate grant. It is clear that this was exploited by some owners, and grants were paid in several instances at a level which exceeded the unlicensed value of the vessel We consider that in drawing up the decommissioning scheme, the Agricultural Departments could have made much better use of the flexibility allowed by the relevant European Community directive. As a result, in our view the scheme was grossly expensive for what it achieved."
But in its next conclusion--in the section of its report which I quoted in the debate last Thursday--it said that it saw some future use for decommissioning grants. It made it clear that it was objecting not so much to the principle of decommissioning as to the manner of operation of the decommissioning grant scheme introduced by MAFF in 1986.
One readily appreciates why the present Minister of Agriculture, Fisheries and Food, having been involved as Minister of State at that time, does not want to get his knuckles rapped twice. While such personal feelings may be understandable, they should not stand in the way of easing the process of restructuring so that the industry can cope with the much reduced fishing opportunities that are about to occur.
In an Adjournment debate initiated by my hon. Friend the Member for Roxburgh and Berwickshire (Mr. Kirkwood) in November, the Minister of State, Scottish Office, the hon. Member for Galloway and Upper Nithsdale (Mr. Lang), referred to the criticisms of the previous scheme by the National Audit Office and the Public Accounts Committee, and then made the telling remark
"although my view is that those criticisms could be met".--[ Official Report, 21 November 1989 ; Vol. 162, c. 112.]
If the Scottish Office believed that the criticisms could be met, one would have hoped that it could have persuaded its counterpart at MAFF that they could be met. It is clear that it failed in that task, so that effectively MAFF vetoed a scheme that the Scottish Office must have thought was viable.
Another criticism of the National Audit Office and the PAC was about the difficulty of targeting those to whom the scheme should apply. How should it be targeted? What discussions have the Departments had with the industry in recent months, when the industry had expressed its willingness to have a decommissioning scheme? Have discussions taken place to see how that could be effectively targeted without leading to some of the more efficient and newer vessels being taken out? Many other EC countries operate decommissioning schemes. Has MAFF considered those examples with a view to seeing how they might be implemented here?
If we are not to have decommissioning--which would seem to be the outcome of today's ministerial statement--what shall be have? How far will the steps announced this afternoon go towards meeting the targets set under the multi-annual guidance programme? No steps appear to have been taken in that direction, and that is regrettable.
We appreciate that MAFF is hooked on a licence aggregation scheme. I have no objection to that, because such a scheme has a part to play in the overall licensing system, but the Minister is kidding himself if he thinks that that will make a significant contribution to reducing the
Column 479capacity of the fleet. How does he see the reduction in the fleet size being managed? The fear must be that it will not be managed at all.
Will the Minister expand on what was said in this afternoon's statement to the effect that, with the exception of grant aid for essential safety improvements, vessel grant aid will be restricted to those cases where it is needed to back up European Community grant aid? It is my understanding-- I shall willingly accept correction if I am wrong--that European grant aid was given if a project was already in receipt of national aid. I may have misinterpreted what was said, and any elucidation of it will be most welcome. It appears, however, that the cart was being put in front of the horse, and effectively all forms of grant aid were being cut off. I shall welcome correction if that is not the position.
What is being suggested could have serious implications for the boat building industry. That is of considerable concern to my hon. Friend the Member for Argyll and Bute (Mrs. Michie), as many of her constituents have jobs at the shipbuilding yard at Campbeltown. Other parts of this afternoon's statement suggest that the industry will be obliged seriously to reduce its fishing activity, yet there has been no suggestion of financial underpinning. When farmers were expected to accept milk quotas or to take the set-aside scheme, some compensation was payable.
We tend to talk generally about the fishing industry, but in many parts of the country, especially Scotland, including my constituency, the "industry" means individual boats and very small businesses. Individual skippers and crews have directly to provide for their families. They are to be subjected to high interest rates and fewer catching opportunities with which to generate an income to meet household expenses and payments on their boats.
The Government seem to be cutting the industry adrift, as it were. Onshore processing workers, workers in the boat building industry, skippers and crews, and fishing communities generally are about to take the full blast of free market forces. If that is the position, it will be a haphazard way of deciding who will be around when, as we hope, stocks are built up again and there are greater catching opportunities.
The way in which the Government seem to be asking the industry to go provides no guarantee for the future security of the industry, let alone its future prosperity. The Government have a responsibility. The licensing scheme which they introduced in the mid-1980s failed. It did not keep a check on the expansion of the industry. They were warned by my right hon. and hon. Friends, and by official Opposition Members, of the likely outcome of the scheme. The Government presided over the building of new boats and helped to fund their construction at a time when fishermen were being told that things were looking good for the fishing of haddock. Only two years have passed since the scientists were recommending an increase in the total allowable catch for haddock.
Ministers cannot run away from their responsibilities. It is important that we take every opportunity to pursue them to ascertain exactly what they are proposing to assist an industry that is facing a crisis. I acknowledge again the efforts that were made at Brussels successfully to negotiate a better TAC than looked possible at one stage, but that was only one part of the package by which we said that Ministers would be judged. On the critical part of the
Column 480package--the restructuring of the industry-- they have said nothing. It would appear that they are abdicating their responsibilities in that regard.