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foot and mouth disease, and on how that agreement will assist companies such as Cotswold Pigs in my constituency to export? Another problem that the Government should deal with is the monopoly created by the drastic reduction in the numbers of buyers at the farm gate. Not only has that enabled the few remaining buyers to dictate terms, but it has allowed them to inflate their prices to the consumer. That is illustrated by the figures that I gave comparing increased food prices with reductions in farm income over the past 10 years. According to "Euromonitor" no fewer than 15 of the 22 most profitable European food manufacturers are British. Perhaps the balance of trade in this respect has been upset. The Monopolies and Mergers Commission should investigate the activities of five supermarket chains which control a substantial proportion of the retail market. Their power is healthy neither for the farmer nor for the consumer--nor for the rural shops in my constituency and elsewhere which often find it hard to compete. They frequently have to sell their goods at prices much lower than supermarkets can charge for them.The last major problem facing agriculture lies in the workings of the European Commission. Much concern has been expressed in the country and the county about the proposed nitrates directive. Were it enacted it would have a catastrophic effect on farming in Lincolnshire. No convincing evidence has been found to show that current nitrate levels are harmful to health, and I urge the Government to remain steadfast in their opposition to this ill-conceived European directive. Will my hon. Friend give an assurance today that under no circumstances will the United Kingdom agree to any proposal that imposes a cost on the farmer out of all proportion to the alleged benefits to the environment? Will he ensure, too, that non- agricultural sources of pollution, about which we hear far less, are tackled?
On the subject of the environment, no Lincolnshire Member dealing with farming in the county could pass over the need for strong sea defences. Perhaps my hon. Friend will briefly comment on them and on the resources that the Government will allocate for them. What the Lincolnshire farmer requires, in the famous cliche , is that elusive level playing field. He is the most cost-effective farmer in Europe ; all that he asks is to be allowed to compete with his European counterparts on an equal footing. He realises that it no answer to seek massive subsidies, and as a Member of Parliament representing a largely rural constituency I have never asked for massive subsidies, although I realise that they might have been an easy way out and might have earned me short-term popularity. We in this House know that subsidies only produce distortions and imbalances in the market and act unfairly.
Government policy, and the common agricultural policy, should be to ensure that farmers produce food at sensible prices for everyone and that food stocks are kept at sensible levels. I have mentioned the need for sensible levels because I am conscious that the Food and Agriculture Organisation of the United Nations has warned that global cereal stocks are below safe levels and that any adverse weather conditions could affect them. We have seen in recent years how one event in Chernobyl or one small drought in Spain severely damaged the stocks.
Of course, I appreciate that the massive surpluses of the early 1980s had to be dealt with, and they have been. Now
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our farmers, the most efficient in Europe, should be given an opportunity to earn a decent living in open and fair markets. This debate is not only about farmers ; it is about improving the environment, and only farmers can do that. I hope that my hon. Friend the Minister and his colleagues in the Department of the Environment will resist the recent spate of unwanted planning applications by Unigate for large poultry units to be sited across my constituency. The company wants to produce 1 million birds a week. What will that mean for small poultry producers in my constituency in terms of unfair competition? A fundamental part of the Government's agriculture policy must be to ensure that by 2000 we have a viable farming industry and that a family firm such as J.R. Dring and sons is still farming and providing good-quality food for a decent return. That will enable such firms to support a thriving rural economy and will ensure the continuance of the magnificent contribution made by farmers to Lincolnshire life.2.49 pm
The Parliamentary Secretary to the Ministry of Agriculture, Fisheries and Food (Mr. David Curry) : I congratulate my hon. Friendthe Member for Gainsborough and Horncastle (Mr. Leigh) on his initiative in bringing forward this debate. I know that he does not hesitate to tell his farmers when he disagrees with them. He does not necessarily reproduce the National Farmers Union brief. When he says that there is a real problem in farming, especially in Lincolnshire, which is one of the better endowed counties in the United Kingdom, we have a duty to listen to him. I undertake to study carefully what he has said.
I regret that the Opposition have not had an opportunity to study at first hand what my hon. Friend has said, because there is not one Opposition Member in the House and the Opposition Front Bench is not therefore represented in the debate. No doubt my hon. Friend will point that out to his farmers when the Opposition pretend that they are capable of looking after British agriculture.
I agree that there is a problem about farm income and we should not pretend that things are other than what they are. The farmer's costs are fixed by the market which is free to move, but, by and large, his income is fixed by politicians. That is because of the pricing structure in the European Community and because of the impact of economic policy on the farmer. However, farmers should reflect on what the situation would be if their incomes depended wholly on the market. If farmers were required to produce at world market prices, it would have a severe and immediate impact on agriculture and severe radical restructuring would follow. It would be akin to what we have seen in other industries that have not had a price support mechanism and the limited but certain insurance that the Community has given to farmers.
We know the reasons for the difficulties, but we had to tackle the problem of surpluses. I pay tribute to my hon. Friend for acknowledging that and for defending that policy in his constituency. We had to control dramatically rising expenditure and we have to pursue an anti-inflation
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strategy. Perhaps that matters more to the farmer than to many other people precisely because of the way in which his income is made up.We shall do what we can to help. In the livestock sector we have more instruments at our disposal for dealing with sheep and cattle whereas in predominantly arable constituencies we are more limited. My hon. Friend mentioned the green pound. I give him the pledge that he seeks ; we will do everything in our power to eliminate the green pound by the end of 1992. He will be interested to know that on Monday the monetary compensatory amount on cereals will fall to 2.5 per cent., which will be the lowest level for five years. The MCA for pigmeat and beef will be zero. We got substantial devaluations at the previous price fixing and what has since happened to the pound has tended to move those further. That is an important contribution to the creation of a level playing field which I recognise as one of the most consistent demands of the British farmer.
By means of the diversification programme, the Government have also sought to assist by set-aside and schemes such as woodland and conservation schemes. I do not pretend that those provide help other than at the margin, because in general terms they will not make the difference between life and death, but they are an attempt by the Government to make available to farmers the means by which they can diversify a little and explore alternative sources of income. They also enable us to take the edge off some of the immediate pressure applied by the application of the stabilisers and European constraints.
My hon. Friend spoke about moisture content. The United Kingdom applies 14.5 per cent. while the rest of northern Europe applies 15 per cent. That percentage is a Government choice and was not imposed by Brussels. We have the option to apply the same moisture content as the rest of the northern European Community. Should conditions in 1990 indicate that we should move to the slightly more relaxed 15 per cent. we shall do so. We have not done so in the past two years because we have had relatively dry harvests and such a move has not been required.
I entirely echo my hon. Friend's comments about salmonella. This is a classic case of the Government taking draconian measures to tackle disease in our flocks, and we are pressing the Commission to produce proposals which will impose a similar requirement on others. My right hon. Friend the Minister mentioned that point to the Agriculture Commissioner at the Agriculture Council, in which we both participated earlier this week. Incidentally, my hon. Friend referred to the notable triumph at the Council meeting with respect to foot and mouth, which is the biggest single animal disease problem. It would be of particular concern in Lincolnshire, where pig production is a major agricultural activity.
My hon. Friend referred to Cotswold Pigs as one of the country's premier pig production units. We have agreed that the whole Community will move towards the slaughter policy carried out by the United Kingdom, Ireland, Denmark and Greece and away from the vaccination policy that the rest of the Community has pursued. That is an example of where British practices will be the norm for European practices. They will give much greater security in terms of disease-free livestock and movement inside the Community. It will give an assurance
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that we can export to the world market, knowing that our home base--which will be the whole Community--is able to give greater guarantees that livestock is free of disease.My hon. Friend referred to the limited number of companies that tend to dominate the grocery sector. Competition is a matter for my right hon. Friend the Secretary of State for Trade and Industry, and I shall draw my hon. Friend's remarks to his attention. There are some positive aspects which I am sure my hon. Friend would acknowledge. Competition between retailers is fierce and it is fair to say that that is probably good for the housewife. More important agriculturally, those retailers are increasingly collaborating with farmers and farm organisations to require a high standard of production, which is bringing farmers closer to the market place. Recently, I visited Bedfordshire Growers--which I realise is not in my hon. Friend's constituency--which has links with some of the major chains. It is producing high-quality produce in response to demand. Perhaps we should discuss whether farmers would find it easier to form co- operatives that would take them more directly into the wholesaling and retailing sector. The law is somewhat dificient in this respect and needs updating--a matter to which we should perhaps devote our attention.
I endorse my hon. Friend's comments about nitrates. My right hon. Friend the Secretary of State for the Environment is a prime negotiating partner in discussions on that matter. When I represented the United Kingdom at the Agriculture Council in May, I insisted that the Council should set up its own group to advise environmentalists on the purely agricultural implications. I was afraid that the matter would run away from Agriculture Ministers and would be settled by other Environment Ministers who do not have a close relationship similar to that which exists between my right hon. Friends the Minister for Agriculture, Fisheries and Food and the Secretary of State for the Environment.
We should have a sensible authority to blend and treat the water. A reading of 50mg per litre taken once in the year should not immediately condemn us to large-scale set-aside or afforestation. That is nonsense in terms of environmental policy. We are co-operating closely with my Government colleagues to ensure that the agricultural point of view is portrayed effectively. We will honour our assurance to pay the closest possible attention to this matter.
Mr. Leigh : Because I did not have time to mention this point, perhaps my hon. Friend will comment on set-aside. It has a part to play in improving the environment. I understand that recently the Commission agreed an increase to £250 a hectare. Without any cost to the Treasury we might be able to increase the generosity of our
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set-aside procedures. Although my hon. Friend may not be able to comment today, perhaps he will agree to consider the matter.Mr. Curry : We are preparing the third round of set-aside. We are anxious to enhance the set-aside programme to give it a greater environmental content. That will have implications for the rates. Perhaps my hon. Friend will take my comments as a hint that I shall consider his points.
My hon. Friend mentioned flood defences and I realise that they are important in Lincolnshire. The amount allocated to flood defences has increased by more than £29 million between 1989 and 1992 and the main target is the east coast. My right hon. Friend the Minister is especially anxious that he should not be deprived of a job by the submergence of his constituency, although in the early 19th century, submerged constituencies were represented in the House, thus relieving the hon. Members concerned of any constituency burdens. Lincolnshire will receive the maximum grant rate of 75 per cent. for sea and tidal works. I have discussed the matter with the National Rivers Authority and 20 per cent. of the total grant that we give to it will be targeted to Lincolnshire in 1990-1991.
My hon. Friend will not expect me to comment on the planning problems in relation to chickens. In my role as a constituency Member, I know that planning is the harshest bed of nails on which an hon. Member can find himself impaled. I shall simply note what my hon. Friend has said and draw it to the attention of my colleagues who may eventually be directly concerned in the matter.
My hon. Friend has done a great service to his constituents in bringing the situation in Lincolnshire to the attention of the House. We should remember that Lincolnshire is a relatively favoured county. My hon. Friend praised the production of grain, and the county is one of the bread baskets of the United Kingdom. My hon. Friend also praised the county's record in agriculture. Bulb production, to mention the most spectacular area, is a major national asset. My hon. Friend also mentioned pigmeat production in which Lincolnshire is at the forefront of technology.
While praising the county, we must listen carefully to the problems raised. I will take careful note of what my hon. Friend has said about the concerns of farmers in the county. He will, no doubt, note that the Government are committed to do their best for agriculture. With such a partnership, I am sure that my hon. Friend will continue to represent his constituency outstandingly and that his constituency will continue to make an outstanding contribution to our agriculture.
Question put and agreed to.
Adjourned accordingly at one minute past Three o'clock.
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