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We expressed serious concern about the fall in salmon prices on the European market to the Commission in Brussels. A number of meetings were held and ultimately the Secretary of State wrote to Commissioner Paleokrassas on behalf of the United Kingdom Government expressing this concern--as the hon. Member for Orkney and Shetland mentioned--and asking for appropriate measures to be taken. Following that letter, the Commission introduced emergency safeguard measures in the form of minimum import prices on 20 November. Minimum import prices for round salmon were set at £1.20 per lb, for gutted salmon at £1.33 per lb, and for gutted salmon without heads at £1.46 per lb. We welcome this decision as a step forward, providing as it does a temporary floor for the market while the longer-term problems facing the industry can be dealt with.

The minimum import prices will have effect until 31 January this year. They will be reviewed by the Commission before the end of January in the light of market trends. I spoke to Commissioner Paleokrassas on 20 December and urged him to extend the MIP to 31 March and to press Norway as hard as possible on the issue of dumping.

Mr. Tam Dalyell (Linlithgow) : Mr. Pattinson tells us that, at these prices,

"the Scottish industry will continue to lose £1 million revenue each week, and more jobs and communities will be put at risk." Is he right?

Sir Hector Monro : I do not know. I could not possibly tell the hon. Gentleman whether the industry will continue to lose £1 million a week or not. I hope not.

There has been some recovery in market prices--for example, the average price of round salmon over 5 kg had increased from £1.11 per pound in mid-November to £1.31 per pound at the end of 1993. Round salmon of between 3 and 4 kg increased in price from £1.18 to £1.44 at the end of the year. That is above the reference price of £1.38. I do not underestimate the problems that the industry faces, but it is interesting to note that round salmon sales to the continent in November were 677 tonnes and in December 1,130 tonnes, an increase of 73 per cent. There was also an increase in the sale of gutted salmon of up to 53 per cent. That certainly gives the impression that the MIP has helped to stabilise the market, albeit at a price that I think is too low. It is pushing up the market price towards the reference price.

Mr. Elliot Morley (Glanford and Scunthorpe) : Is the Minister hinting that some of the problems that the industry faces are market oriented, or does he accept that the problem is being caused by the dumping on the market of Norwegian salmon?

Sir Hector Monro : Of course it is. I have not yet come to dumping, but it is crucial. Without the enormous importation of salmon from Norway into the Community, the problem would not arise. Of course dumping is the root cause of our problems and I do not disguise the fact.

The reference price is important and I am glad that the Commission introduced it on 1 January 1994 at a level above the MIP, although I should have preferred it to have been higher than £1.38 rising to £2. We made as many representations as we could, and the figure was set at 16 per cent. above the minimum import price.

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Mr. Calum Macdonald (Western Isles) : Does the Minister accept that for the reference price to be effective there must be producer organisations? Will he therefore offer his wholehearted support to the setting up of such organisations?

Sir Hector Monro : I do not agree that the reference price is in any way related to the producer organisation issue. The key issue is the attempt to get Norway to adopt a reasonable attitude and to get the Commission to agree that Norway is dumping salmon. We must put an end to that as soon as possible and get the Norwegians to understand that there has to be a fair market. It certainly is not fair now and that is the target of all our efforts.

My officials are going again to Europe next week and I am going the week after to talk to Mr. Paleokrassas. I hope that we will be able to make progress towards action on the anticipated Norwegian dumping.

Mr. Roy Beggs (Antrim, East) : I congratulate the hon. Member for Orkney and Shetland (Mr. Wallace) on securing the debate. Will the Minister bear it in mind that the adverse effects of dumping on the Scottish industry also have an effect on my constituency which has Northern Ireland's only salmon farm?

Sir Hector Monro : When we go to Brussels or Luxembourg we do our level best for the Northern Irish fishing industry, in the same way as we do our level best for that of all the United Kingdom. We have the welcome support and co-operation of the Irish Government who are as concerned about low prices affecting their fish farms as we are about them affecting ours.

It is for the Commission to consider whether, under article 23 of EC regulation 3759/92, a countervailing charge should be introduced for imports of salmon to the European market if prices fall below the reference price. We understand that the Commission considers that to do so may risk a challenge under the GATT arrangements. We are in close touch with the Commission to try to resolve that dilemma. Market instability is in no one's interest, including that of Norway. Regulations are in place in the Community to ensure fair trading between member states. If and when Norway becomes part of the EC, she will be required to operate within the Community rules. There is a history of allegations by the Scottish and Irish farmed salmon industry that Norwegian producers are trading unfairly by dumping salmon on the European market at prices below the cost of production. A complaint made in 1989 was investigated by the Commission, which concluded that there was evidence of dumping by Norwegian producers.

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A further complaint was made in 1991, but the Commission has yet to carry out an investigation based on that complaint. The Government have consistently argued that the Commission should carry out such an investigation, and this remains our position.

Last year, the Commission invited the salmon farming industry to update the information previously provided to the Commission in 1991. The hon. Member for Orkney and Shetland implied that it was the Government's duty to produce all the facts and figures. We will gladly help the industry, but it must help us. It is not easy to produce the facts and figures and we must work together to provide the information as quickly as possible so that the Commission can decide what to do to stop further massive importation into the Community of Norwegian salmon. As the hon. Gentleman knows from various discussions and meetings that I have had with him, I am keen to resolve this matter in the interests of the Scottish farmed salmon industry, and I shall add a word for Ireland.

Mr. Beggs : Northern Ireland, please.

Sir Hector Monro : I shall add a word for Northern Ireland and for Ireland as well.

It will not be easy to get a quick solution. I have to attend Commission and Council meetings and the rate of progress in getting almost anything achieved in the Council of Ministers is frustrating. We have to work at it as hard and as quickly as we can to help an industry that is in a serious position because of prices that are so much below the cost of production.

I have said that prices have been creeping up since the autumn, and thank goodness they have, but we still have a long way to go before the industry reaches profitability.

The hon. Member for Orkney and Shetland and other hon. Members have mentioned compulsory producer organisation. The Government believe firmly that we could proceed much more quickly by having a voluntary producer organisation and there is no reason why the industry should not get together and get started on that right away. We would be able to give some financial help towards the adminstration of a voluntary producer organisation. However, no producer organisation, despite what the hon. Gentleman said, will be effective unless we can get co-operation from Norway.

The motion having been made after Ten o'clock and the debate having continued for half an hour, Madam Deputy Speaker-- adjourned the House without Question put, pursuant to the Standing Order. Adjourned at nineteen minutes past One o'clock.

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