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If we consider some of the broader perspectives of the CAP we find further oddities. For example, it is ludicrous that 4 per cent. of the CAP's budget goes to both tobacco and vegetables when tobacco is seen to cause cancer and vegetables are believed to help prevent it. The system is faulty in economic terms, in retaining a rural population and in producing healthy foods.
Faced with that, I should have thought that any Government, especially a British one, would have taken the opportunity of the GATT negotiations to put pressure on our EEC colleagues to engage in a major reform of the CAP. Unless we do so the problems will become greater. Unless we succeed, a subsidy war will break out between the United States and the EEC, and the result will be an even more expensive CAP.
This is where the Labour party opposes the Government's approach to the GATT agriculture talks. The Government have failed to grasp the significance of the linkage between CAP reform and the GATT. Despite the condemnation of the Minister, the Government have slavishly followed the United States' linear approach to
Column 542the problem by examining only how we can minimise the subsidy cuts. It is not surprising that they have been negative.
The Minister made some derogatory comments about the American deficiency payment system. Why has he not been considering the possibility of introducing deficiency payments in Europe? That might be a much more effective way of providing food at more reasonable prices for the consumer and of providing support for farmers. The system worked well until we entered the EEC. It has not, however, been costed since. It is said that such a system would cost too much, but, remembering that three areas of agricultural support might have to be reduced, why do not we consider the possibility of deficiency payments to ascertain whether they constitute an option? I do not know the answer because the Opposition have been unable to carry out the costings, but the Government have the necessary facilities. They have computers and they could undertake the computer projections. Let us have some statistics.
Mr. Gummer : In effect, the hon. Gentleman says, "Why?" I shall tell him. He knows that there is no point in putting forward propositions that are unacceptable to every other member of the Community. He knows that Britain, in supporting the Commission, managed to secure what I outlined in my speech only after seven extremely long meetings. We did so in the teeth of opposition from most other member states. The hon. Gentleman puts forward a preposterous proposal that is not acceptable to any other member state. That shows how out of date the Labour party is. It could not negotiate within the European Community and, thank God, it will not have the chance to do so.
Dr. Clark : I recall hearing it said in the House yesterday, and I read in "Today" this morning, that the Chancellor of the Exchequer was urging the hard ecu proposal for the reform of the monetary system in Europe. I recall it being said that when that proposal was first made the United Kingdom was in a minority of one. However, there had been careful costings and the necessary homework had been done. The Chancellor of the Exchequer said that the Government had been able to prove the strength of their case and would have a fair wind in the Community. Why has not the Minister tried to persuade our European colleagues as the Chancellor of the Exchequer did? It is not good enough merely to attend trade lunches and be offensive to our neighbours. That is not the way to persuade them to vote for us. Why have not the Government considered seriously the production entitlement guarantee proposal? That system would give farmers a guaranteed price for a set amount of production. It is a mechanism in which deficiency payments could be used yet again. The amount to be subsidised would be limited and, therefore, the price could be contained. In that way food prices could be brought much nearer to world levels.
Why does the Minister--I use Sir Simon Gourlay's phrase--hit the roof every time the NFU suggests the supply side management of agricultural support? The Opposition recognise the weakness of the approach with its dangers of ossification and rigidity, but at least the NFU has produced some positive ideas and is contributing to the debate. At the same time the Government are purely negative and content with only a damage limitation
Column 543exercise. By following that line the Government are selling the country short. They are doing farmers a disservice in the long term and costing consumers dear.
The Labour party believes that farmers need to be supported financially. We believe, as does the Minister, I think, in a thriving countryside. We consider that that can be achieved only by having farmers living and working in it. Without farmers the countryside would not be as we like it or as we see it today. To achieve those objectives we must move away from a purely market-supported agricultural system. The Opposition have put forward proposals for the payment of a green premium to farmers who are prepared to do their work in an environmentally friendly and positive manner. That means that we would start the process of decoupling public subsidy from production.
I was delighted to see our views endorsed, in effect, earlier this month by an authoritative report commissioned by the much-respected World Wide Fund for Nature and the Council for the Protection of Rural England. The report supports the main thrust of the Opposition's case that cutting prices paid to farmers would lead to environmental degradation, even more farm bankruptcy and rural depopulation. The report's conclusions are basically the same as ours. A section of the report states :
"The budgetary cost is large and set to rise ; the benefits to farmers are at the expense of consumers and taxpayers ; price support, the chief instrument of the Common Agricultural Policy, is an inefficient way of supporting farm incomes ; and current policy instruments frequently encourage and exacerbate those aspects of farming which damage the environment."
We agree with those conclusions. The Government should be arguing for a policy reform along those environmental lines.
We do not believe that food production should be rewarded by the market alone, although I cannot help a wry smile when I hear the Minister talk about that. What does he mean by the market? Does he mean the free market or the largely subsidised market? I think that he means the subsidised market. We cannot argue that we should leave it to the free market ; the whole system would fall apart. Public support for farmers should be focused on the environmental factors that the market cannot meet. A Labour Government would develop an environmentally based system of payments to farmers that would be integrated into wider agricultural policies. There would have to be a transitional period, and there would have to be payment for production during that time. Specific arguments might be made for farmers who wish to switch towards more benign methods of food and animal production, or who produce healthier food. Such a scheme would have to be phased in, but we could start by extending the environmentally sensitive area concept that has worked so well and has received support from both sides of the House. Such a scheme has been shown by the CPRE, the World Wide Fund for Nature and the Countryside Commission to be a much cheaper system of supporting farmers than the current one. As the hon. Member for Sherwood again pointed out, only £4 out of £10 goes to the farmers. The current system is inefficient.
The Uruguay round provides the opportunity for reform, and it must succeed. It is inevitable that subsidies to support agriculture will be reduced, so we must try to achieve reform. It is necessary to support farming on the grounds of both food production and the environment.
Column 544We are pressing for a sensible reform of the CAP which would enable us to reduce the amount of public subsidy for farmers while not reducing the actual amounts that they receive. By that means, we can achieve an agreement on GATT that will benefit the service, manufacturing, and other industries which make up 97 per cent. of the gross domestic product of the European Community.
Mr. Jerry Wiggin (Weston-super-Mare) : The crucial subject of the GATT round, with particular reference to agriculture, appears to have come to our attention somewhat late. We, as interested Members of Parliament, should have been briefed about and had our attention drawn to the importance of the subject many months ago. The National Farmers Union, which has been rightly concerned about the immediate profitability of agriculture, has lamentably failed its membership in this matter. I am sorry to be critical of that organisation, but it is reasonable to say that if the GATT round were to fail as a result of the obduracy of the European farmers and, for that matter, the American trade negotiators--I suspect that both groups need their heads knocking together--agriculture will be held to be responsible for a serious reduction in world trade. I have heard that $3 trillion is at stake in the GATT round.
I am no great expert on trade matters, but on such an occasion it would be wrong not to declare an interest. All the outside interests that I declare in the Register of Members' Interests will be affected, in some way or another, by the outcome of the GATT negotiations. I suspect that all hon. Members with outside interests will be in the same boat.
To say to our beleaguered farmers that they must take a cut in support is a serious political proposition. I listened with some care to the hon. Member for South Shields (Dr. Clark), but I must admit that I should not know what to say to my hon. Friend the Member for Sherwood (Mr. Stewart) about the planning of his farm. The Opposition spokesman left him in no doubt that on the one hand the CAP should be abolished, while on the other it should be reformed--and at the same time my hon. Friend must grow environmentally suitable crops, whatever they may be. We have not yet been told.
There has been a chronic decline in farming profitability. Since 1977, farm gate prices have risen by only 60 per cent., compared with a rise in the retail prices index of 150 per cent. Real farming income has fallen by an average annual rate of 2.4 per cent. since 1979. High interest rates and inflation, the premium on vacant land, persistent green pound short- changing and poor marketing power against the supermarket giants have all contributed to that decline. One-off factors, such as the food scares that affect consumer confidence, new competition from eastern Europe, disruptions in the French lamb market, the drought and the Gulf crisis have all added to the woes of our farmers.
The Select Committee on Agriculture, which I chair, has just visited the United States of America and Canada, and their farmers are in no better a position. Canadian farmers have suffered a drop of 50 per cent. during the past two years in the real price of their products. We have considerable sympathy for world agriculture. The Cairns group has a clear and specific objective, which must be understood in the context of the geography of the world.
Column 545The fact remains that wheat can be grown in Canada and Australia far more cheaply than it can be grown in northern Europe. Beef can be produced in Australia and the Argentine more cheaply than it can in northern Europe. In fact, almost every basic commodity can be grown more cheaply outside this country, and then imported, than it can be grown in Britain.
The only alternative for Governments is to find a way to support the farming industry--that is, if we believe that it is important to have that industry. I find it extraordinary that, yet again, I am having to argue that we must support our agriculture. We have been on the brink of starvation twice this century. It is somewhat righteous to argue that that cannot happen again, because until the events in Iraq apparently there was no necessity for armed forces. Hon. Members should just think about the size of the Army that we have sent to the Gulf. I do not believe that, for strategic reasons, we should be wise to allow our agriculture to move into a state of total decline. We must take into account the social aspects of the CAP--a policy that I have always thought to be more social than agricultural. It was designed to keep prosperity and people in the countryside, whether they be the hill farmers of Scotland or the olive growers of southern Italy. Without assistance, the countryside of Europe will collapse from one end to the other.
Mr. Cryer : The hon. Gentleman made valid arguments about keeping jobs in agricultural areas. Does he agree that the same arguments apply to textile areas? Is not it important, for social as well as for economic reasons, to keep the textile industry buoyant and developing?
Column 546arrangement is extremely costly ; it supports his constituents at a vast cost. We have to decide whether we provide such support, or whether we do not. The Labour party cannot support the multi-fibre arrangement and oppose the CAP. That would be illogical. If it supports both, that is a different matter.
Mr. Graham Allen (Nottingham, North) : When the hon. Gentleman answers the point raised by my hon. Friend the Member for Bradford, South (Mr. Cryer), will he also comment on the balance between support for agriculture and agricultural workers and the support given to those who work in the textile and other industries? Is not it true that currently more than half the budget goes to agriculture, with only a small percentage going to other industries?
The National Consumer Council issued a brief stating that the average increase in retail prices as a result of the multi-fibre arrangement is 5 per cent. That affects the lower-paid in particular, because cheaper garments are very often those that they purchase. One of my companies imports more than £400 million a year of textiles from abroad, and that cost is translated to about £28,500 per worker in the hon. Gentleman's constituency.
Mrs. Elizabeth Peacock (Batley and Spen) : Does my hon. Friend agree that there is no use telling a housewife living in any textile area that she may enjoy a reduction in the cost of the items that she must buy for herself and her husband if they have both lost their jobs?
It being Eleven o'clock, Mr. Speaker-- interrupted the proceedings, pursuant to Standing Order No. 11 (Friday sittings).
Mrs. Ray Michie (Argyll and Bute) (by private notice) : To ask the Secretary of State for Defence if he will make a statement on the sinking of the fishing vessel Antares from Carradale, with the tragic loss of four lives, following an incident involving one of Her Majesty's submarines.
The Minister of State for the Armed Forces (Mr. Archie Hamilton) : At approximately 02.40 yesterday morning, the Royal Navy submarine HMS Trenchant reported that whilst operating submerged in the Clyde area, certain unexplained sounds on her starboard side led her commanding officer to believe that she might have snagged the gear of a fishing vessel. The submarine therefore surfaced and conducted a visual search of the area, sighting two fishing vessels some 3,500 yds astern. The crew recovered a length of trawl cable from the casing and, believing that she may have snagged the gear of one of the vessels sighted, attempted to make contact on VHF radio. The fishing vessels did not reply.
The Royal Navy then advised the coastguard, who also tried to make contact with fishing vessels in the area, but without success. The submarine remained on the surface for some two and a half hours in good visibility and, as it appeared that the fishing vessels were in no difficulty and that there were no other untoward signs, she continued her operations before returning to Faslane.
Following the call from the Navy, the coastguard initiated inquiries in an attempt to account for all vessels that may have been in the area. During the course of the morning, it was established that the fishing vessel Antares, a 16 m pelagic trawler from Carradale, with a crew of four, was unaccounted for. A search and rescue operation was initiated immediately, and I can now report that the Antares was discovered on the sea bed at 03.40 this morning in the area in which Trenchant reported the previous night's incident. The search for the crew continues but, sadly, it now seems extremely unlikely that they will be found alive. This is of course a tragic loss for the small community of Carradale, and I know that the whole House would wish to join me in expressing the deepest condolences to the families of the four men. The crew of Trenchant and the entire submarine community are also, I know, shocked and deeply saddened.
The Department of Transport will of course be conducting a full inquiry into the incident, as will the Royal Navy, and I would not wish to speculate on the outcomes at this stage. Royal Navy submarines have been operating in the Clyde area for more than 80 years, with an excellent safety record. Fishing vessels are almost always present in the areas where our boats operate, and submariners are accustomed to maintaining a constant and careful watch for them. I believe that our record and our safety procedures are excellent, but we will of course look carefully at the results of both inquiries to see what lessons can be learned from this tragic accident.
Mrs. Mitchie : I am grateful to the Minister for expressing his sympathies, in which I know the whole House shares, to the wives and families of the crew members who have been lost. The shock and sorrow is very
Column 548real in Campbeltown, and particularly in the small, tightly-knit community of Carradale, where the boat came from.
I welcome the announcement that there will be a full and extensive inquiry, and I hope that we will receive an early report. Meanwhile, will the Minister suspend submarine operations in the firth of Clyde, because this is not the first such incident? Will the Minister acknowledge that I and other Members of Parliament representing constituencies in the firth of Clyde area have repeatedly asked the Ministry of Defence to devise a solution to the danger that the accident highlights? There are various options for allowing submarines to identify fishing gear, which often swings a considerable distance away from the position of the fishing vessel itself. I have myself discussed the matter at length with Navy personnel, and they have worthwhile ideas on how to overcome that problem.
Will the Minister explain why the rescue services were not alerted earlier? Finally, it would help the bereaved families enormously in their sorrow if the Navy were able to refloat the wreck, which I believe is lying in 80 fathoms of water, so that the bodies of its crew members can be recovered.
Mr. Hamilton : I am grateful to the hon. Member. My right hon. Friend the Minister of Agriculture, Fisheries and Food, who is in his place, will report this exchange also to our noble Friend the Minister of State in another place.
We shall make every attempt to produce an early report on the incident. Delay is in nobody's interest, and we will ensure that that report is produced as soon as possible.
It would be extremely difficult to suspend Royal Navy operations meanwhile, as that would inhibit extensively the Royal Navy. The hon. Lady said that this is not the first such incident. That may be so, but in the 10 incidents involving the Royal Navy and the two involving the US navy since 1979, there was no loss of life, although two yachts were sunk in the Clyde area. The incident that I have reported is most tragic, but it seems to have been a freak accident. The hon. Lady asked what can be done. We are reviewing the question of attaching bleepers to nets. The Ministry is sponsoring research by the Admiralty research establishment. Trials have already been undertaken, and more will be commissioned. The results so far have given us cause to be very pleased. That innovation could make a massive difference. At present, a submarine can only listen to a fishing vessel's engine noise. If bleepers are fitted to the cables themselves, that will make a major difference to safety. We will place all the emphasis that we can on continuing research into that aspect from here on.
We certainly have plans to recover the wreck. Recovery vessels will shortly be dispatched, and we hope to discover more about what happened when the wreck is brought to the surface.
Mr. Bill Walker (Tayside, North) : My hon. Friend will appreciate that everyone in Scotland is saddened by the incident. The submariners themselves, as well as fishermen, are deeply concerned, because they too are at risk from anything that can snag their equipment when they are operating below the surface. The inquiry should bear in mind not only the submariners' operational needs, which are paramount, but their safety.
Column 549Mr. Hamilton : My hon. Friend is absolutely right. I repeat : the submarine community is equally distressed, because submariners spend a great deal of time with fishermen during their training, and they regard it as a matter of professionalism to ensure that they do not become involved in such accidents. That matters very much to the submariners, and I know that they are deeply concerned and upset that the accident should have happened.
Mr. John D. Taylor (Strangford) : Campbeltown is only miles from Northern Ireland. Northern Ireland's fishing industry has a close working relationship with fishermen on the west coast of Scotland. On behalf of the Ulster Unionist party and our fishing industry in County Down, I extend sympathy to the families in Campbeltown who have been so sadly bereaved and to the whole fishing community there.
Will the Minister acknowledge that what has happened was forewarned? It was inevitable, as fishermen have been saying for several years. It was a tragedy, and it should not be dealt with lightly. It requires not only a specific inquiry into what happened in the firth of Clyde but a wider inquiry into the operation of submarines of the Royal Navy and the United States off the west coast of Scotland and right down the Irish sea.
The fishing industries of Northern Ireland, Scotland, the Isle of Man and the Republic of Ireland--for which, oddly enough, I can speak today--are concerned about the number of incidents involving submarines, of the deaths and losses that have occurred and of the increasing threat in the sea which is attacking all our fleets. I therefore ask the Minister to widen the terms of the inquiry to the operation of submarines in the Irish sea and the firth of Clyde and to report on how there can be better co-ordination between fishing fleets and the submarines of various nations.
There have not been many incidents. It has been implied that submarines were involved in accidents with fishing vessels, but on investigation a number of those accidents were found to have occurred in water that was too shallow for submarines to operate in. We must be careful before attributing to submarines every accident that happens to fishing vesseles in coastal waters around Scotland or Northern Ireland, because that is not the case.
We shall see what lessons can be learned from the inquiry and what can be done to improve our procedures. We must be careful not to rush into saying that this has implications for all submarine activities. We must press on to make the position of fishing vessels safer. I have high hopes for the bleepers that can be fitted to nets.
As the Defence Minister answering this private notice question, my hon. Friend will confirm that the Royal Navy carries out the most scrupulous checks in surfacing and submerging and that, if necessary, he will tighten anything that needs to be done by the Royal Navy. Does he agree that it would be wrong for the inquiry to concentrate only on the Royal Navy's procedures, because
Column 550the procedures of fishing boats may also need investigation? For instance, the procedures for cutting nets may need to be improved. Will he confirm that the inquiry will consider the procedures of not only the Royal Navy but fishing boats?
Mr. Hamilton : Yes. I should like to confirm that there will be two inquiries. The Department of Transport inquiry will carefully consider the implications for the fishing industry, and the internal inquiry of the Royal Navy will be more concerned about whether the right responses were made in the submarine and aspects of what occurred.
The Royal Navy's submarines operate to the highest standards. The reaction of Trenchant, tragic accident though it may have been, was as the Royal Navy would have required : she surfaced and looked around the area to see whether anything could be done. It seems that the fishing vessel concerned had sunk so quickly that she was not visible on the surface.
Mr. Alan Williams (Swansea, West) : Would not the submarine's detection equipment have identified in advance how many vessels should have been in the area? When it surfaced, it would have been absolutely clear that a vessel was missing. Therefore, will the Minister say how much time elapsed between the first awareness of the incident and the first contact with the rescue services?
On the point made by the hon. Member for Argyll and Bute (Mrs. Michie) about the temporary suspension of activities--we all understood the long- term problems of suspension--is not the submarine such a specific piece of equipment that, in the present international context, it is difficult to conceive that temporary suspension would cause any hardship?
Mr. Hamilton : I do not think that we can take that view, because it is important that our submarines keep training for an emergency. We would be running risks by suspending their activities. We must bear in mind the defence interests of keeping our crews properly trained.
The right hon. Gentleman said that the submarine should have known how many fishing vessels were in the area. That is the question that arises, but we must leave it toi the board of inquiry. Submarines are required to listen for engine noise and, as a result of being able to pick them up, to avoid fishing vessels. The inquiry will have to consider that point and why the submarine, if it was responsible for snagging the nets, had not identified the fishing vessel earlier.
Mr. Dennis Skinner (Bolsover) : Will the Minister confirm that this is another incident in a catalogue of catastrophes that have characterised this Government in the past 11 years? People will ask, if the Minister says that bleepers can be used to assist in operations and to prevent such incidents from taking place, why it is necessary to proceed with operations until bleepers can be fitted? Secondly, if there have been other incidents involving Irish boats and perhaps others, surely bleepers should have been fitted before now?
Column 551Mr. Hamilton : The whole business of bleepers arose on an earlier incident, and we have been pressing ahead to develop them in the light of that.
The hon. Gentleman said that this is a catalogue of disasters, but it is not. There has been no evidence--
Mr. Hamilton : This is hardly the time to discuss broader aspects of Government policy, and I do not think that this is the right context in which to do so. No loss of life has been associated with Royal Navy submarines prior to this, but we have pressed on with the development of bleepers, which offer an answer for the future.
Mr. Brian Wilson (Cunninghame, North) : May I first express sympathy to the bereaved and identify with the great sadness which yesterday descended on Kintyre? The Rev. Alistair Dunlop of Saddell and Carradale parish church said :
"Some tragedies can never be prevented, but this kind can. If it's a freak wave you can do nothing. If it is a submarine, you can." Will the Minister recognise that fishermen working in waters off the west coast of Scotland and in the Irish sea have for too long had to live with this unnatural threat to their lives, on top of all the other dangers that they daily confront? Will the Ministry of Defence finally abandon denials and silences in order to recognise, and thus deal with, the persistent scale of this problem?
Will the Minister confirm that technology exists which has been researched in this country for submarines to recognise and thus avoid fishing nets? Will he confirm, in particular, that the Net Nav system, which has been developed by a firm called Sea Metrics, was discounted in March by the Department of Transport, presumably after discussion with the Ministry, on grounds of complexity and cost? As we mourn the loss of the Antares, does he agree that neither of those grounds appears adequate today?
Will the Minister accept the view of the secretary of the Clyde Fishermen's Association, with whom I spoke this morning, that the search for a solution has been retarded by the Ministry of Defence's refusal to admit responsibility for the problem--an attitude which, I regret to say, he appears to be perpetuating this morning by discounting the possibility of naval involvement in previous, as yet unexplained, incidents?
On the specific events of yesterday morning, will the Minister inquire closely into the response of the submarine Trenchant after its master became aware that something had indeed been struck? What breakdown in communications prevented the true fate of the Antares from being revealed during that crucial period? Why was it not recognised that where previously there were three fishing boats, only two were visible to her?
Column 552Will the Minister reconsider his response this morning and give an immediate undertaking, out of sympathy and understanding for the fishing families in the area and along that coast, to divert submarines away from recognised areas of fishing activity until measures can be introduced to safeguard against such tragedies? Never again must fishermen working in flat calm, diligently pursuing their livelihood in coastal waters, lose their lives in such circumstances.
Mr. Hamiltton : The hon. Gentleman suggests that we should abandon our policy of denial. I stand here in the House making a statement precisely spelling out what happened but denying nothing whatever. The hon. Gentleman's comment was inopportune. On admitting responsibility, it must be for the board of inquiry to conclude who was responsible for the incident. I have outlined all the details of the case as I know them. In those curcumstances, we can reach our own conclusions, but it is impossible to say that it was definitely the responsibility of the submarine, because we do not know what findings the board of inquiry will make.
The hon. Gentleman asked whether we intended to admit to previous unexplained incidents. If we take that logic through to its conclusion, the Royal Navy would have to take responsibility for any fishing vessel which for some reason or other happened to be involved in a tragedy and sank, simply because no one else could be found responsible. That would be nonsense. We have gone into the most incredible detail in examining where our submarines were operating, whenever incidents took place in the past. If there was a submarine in the area, we have admitted it. But in some of the cases that we investigated, people accused submarines of sinking fishing vessels in waters which were too shallow for submarines to operate in. We shall not admit liability for every fishing vessel that gets into trouble. I am afraid that there are cases in which fishing vessels go down with no explanation whatever. Such cases are great tragedies, but we cannot expect the Royal Navy to take responsibility simply because no other outcome can be found.
The hon. Gentleman said that, previously, there were three fishing vessels in the area and then only two could be found. I gather that such fishing vessels do not necessarily keep in contact with their colleagues in other boats. Fishing vessels can go down without people being aware of it. We reported back as soon as we possibly could. A search was carried out and the wreck has been found.
I am grateful to the hon. Gentleman for the sympathy that he expressed for the families. We all share that sympathy in the House today.
Question again proposed, That this House do now adjourn. 11.22 am
Mr. Wiggin : I was being drawn by the hon. Member for Bradford, South (Mr. Cryer) on the multi-fibre arrangement. I misled him. I have had an opportunity to check my figures. The Silberston report estimated that the MFA costs United Kingdom consumers £980 million a year and that the cost of each job saved works out at about £29,700, which is three or four times the average earnings in the two industries. It would not be profitable for us to have a quid pro quo argument about it. If one has textile workers, one supports the common agricultural policy as long as one keeps in line on the MFA. There are similar arguments about the CAP and the MFA and about whether one should give a sector of industry special support. I defend the CAP on the ground that it is not as costly or damaging as its critics would have the world believe. My right hon. Friend the Minister of Agriculture, Fisheries and Food spelt out that to compare current world prices with the price that the consumer pays is a wholly artificial exercise. I am sorry that farmers have not been swifter to make capital out of the accusations. Instead they have allowed them to become established as folklore.
Sugar has been mentioned. I work for British Sugar plc. We produce only half the sugar that we eat in Britain. We could produce it all, but we have various arrangements that involve supporting third-world countries. Some 5 per cent. of world sugar is traded on the world market and it is cheap. The Americans are in the forefront of protecting their sugar growers. They are an absolute model of protecting a sector of industry. I do not hear too much about them volunteering to undo those arrangements.
In my travels I have heard almost unanimous complaints from countries outside Europe about export restitutions. I have visited New Zealand on several occasions and I keep in close touch with its representatives. Only yesterday we were discussing its difficulty in operating on a world market with wholly unsubsidised agriculture. Perhaps I should remind the hon. Member for South Shields what happened to the Government who swept away subsidies in New Zealand. They were swept out of office. New Zealand's representatives rightly say that it is unfair for them to sell their butter on a world market subsidised by the taxpayers of Europe. They struggle to operate in that environment. I have some sympathy with that.
I did not get an answer from the hon. Member for South Shields on the problem of what should be done about surpluses. The National Farmers Union is technically correct to talk about supply management. I prefer to call it quotas because it is a simpler and more easily understood phrase. Quotas have worked for years for milk and sugar and previously worked well for hops. A quota system could be introduced for many commodities. I am sorry that the NFU did not subscribe to that view many years ago. It has come round to it only recently--so recently as to be disruptive in the negotiations that my right hon. Friend the Minister seeks to hold. If we could all agree that the problem of surpluses, not the concept of the CAP itself, causes difficulty, we could make progress.
Column 554The food industry has been incredibly slow to remind us how important export restitutions are to that industry. It happens to be a fairly strong element of our export contribution. Confectionery and biscuits are a particularly strong element. The proportion of the value of those goods represented by export restitutions has been demonstrated to be considerable. We must be cautious. I share the view of my right hon. Friend the Minister that our Community partners will not lightly change their political attitude at this stage. I am reminded that 100 years ago the political debate was very much about protectionism. Indeed, the modern Conservative party, founded by Chamberlain, my great- grandfather and his friends in Birmingham in the late 19th century, was founded on the basis of protecting our manufacturing industry. In those days we were a protectionist party. As circumstances have changed and because we manufacture less, it has become in our interest to take a wholly different view.
I am persuaded by many of the arguments that a successful conclusion of the GATT round will be very much in the interest of not only Britain but all trading nations, especially third-world countries, which currently suffer such deleterious effects from constraints not only on fibres and food but on many other products where there are restrictive practices--none so severe as those of the Japanese and the Americans.
With considerable cheek, the Americans have asked for a huge reduction in subsidies when they are perfectly well aware of the political problems that we shall face even in achieving a 30 per cent. reduction in support prices. The Canadians take the rather more sensible view that it should be 55 per cent. We must bear it in mind that Canada currently subsidises transport and milk and plenty of other goods and services. Once one assists one part of agriculture, there is a knock-on effect on the rest of the industry.
Agriculture is our core industry. Historically it has always been disastrous to allow agriculture to sink into too poor an economic condition because shortly other industries follow. We must remember the lessons of history. One is that it is sensible and wholly in the national interest to maintain a viable and prosperous countryside and farming community.
Mr. Ted Garrett (Wallsend) : Both opening spokesmen employed some competent arguments, but I disagreed with one statement which they both made. They said that farmers were there to protect the interests of the countryside. We should not let that assumption go unchallenged. In East Anglia there has been vandalism. In the counties in the north, dry walls are left crumbling. Everywhere we see tractor damage to our public highways and pollution of our rivers and streams by the farming industry. So that statement must be qualified.
I have always had an interest in agriculture, although admittedly somewhat low key. Older hon. Members will remember that the first Select Committee on Agriculture was created by the Labour Government under Harold Wilson. I served on that Committee with some Tory Members, and it was an exciting one. It is a matter of history now that the Labour Government abolished the first three Select Committees on Agriculture, on Science and Technology and on Education and Science--because
Column 555we had the audacity to ask to go to Brussels to view agriculture abroad. George Brown, then Foreign Secretary, assisted in their abolition. It was left to the incoming Conservative Government rightly to reinstitute Select Committees, which are now firmly established.
I am sorry that the Minister of Agriculture, Fisheries and Food has left the Chamber. I have some sympathy with his case. For the past 12 years I have been a member of the Council of Europe and I serve on its agriculture committee. It is the most difficult thing in the world to get the committee to agree on any report. It is the most conservative organisation that it has ever been my misfortune to serve on. I understand the problem. I see politicians from Germany, France, Austria, the Baltic states and the Iberian peninsula. We deliberate and argue, but once it comes to making a decision to improve the agricultural interests of Europe, they will not support it. We all know that it would be political suicide for them to do so. Unless we can find a way round that, our Minister, of whichever party, faces insufferable difficulties. The same problem translates into the European Economic Community.
I tremble at the prospect of the failure of the general agreement on tariffs and trade round. It would be disastrous for Britain and for all those who work in our different businesses. If the Uruguay round fails we can only expect our growth prospects to diminish. I am lucky that the Secretary of State for Trade and Industry is present for my speech, I hope that he may reply to it favourably. It is an elementary fact that as a nation we must depend on exports, and now more than ever. As an island nation we depend more than most countries on openness and the freedom to sell goods and services. Those are simple economic premises. The Minister of Agriculture, Fisheries and Food was right that the current GATT round is in crisis. it has major problems to tackle, not least in agriculture. There are vested interests in agriculture which are concerned to ensure not that more jobs are created but that the rotten status quo is maintained.
I do not want to spend valuable time going over old ground. I want to draw attention to what is at stake in this Uruguay round. The United Kingdom is a world leader in many areas, particularly in services. Services is an umbrella word which covers sectors as diverse as telecommunications, insurance, computing and banking. They are growth areas in which we as a nation can take a lead. Agriculture pales into insignificance compared with the service sector. In the EEC, agriculture accounts for only 3 per cent. of gross domestic product. In this country services account for more than 50 per cent. In the United Kingdom, banking, insurance and finance account for 12 per cent. of our total work force. Services are important to our future interests. At a time when eastern Europe is opening up, British businesses have wonderful opportunities to sell their services, technology, electronics and engineering and civil engineering expertise. If we can put those aspects of our society in the front line, we shall do the nation a great service. I wish the Secretary of State well in his new job. He has tremendous responsibility. I urge him to give priority to those matters in his work at the Department.
It would be criminal if the EEC stumbled over agriculture and sacrificed all the other business interests that are at stake.