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Mr. Tony Marlow (Northampton, North): My right hon. and learned Friend mentioned the scheme for calves and a figure slightly higher than £100. As he knows, bull calves can be worth anything between £50 and £350.How will the scheme work as regards the range of quality in bull calves and how will it operate to ensure that it pans out fairly between farmers?
Mr. Hogg: The detail should be explored in greater detail later. I am trying to deal with the main concerns that hon. Members have expressed.
I recognise that, if the market remains depressed, those measures will not be sufficient in themselves. In my statement on 24 March I referred to the common agricultural policy's mechanisms for market support--in particular, intervention purchases of steer beef and the possibility of aid for the slaughter of older animals.
Small quantities of beef have been offered to the intervention board this week and I shall press the Commissioner hard tomorrow for those quantities to be accepted. We have also impressed on the Commission the need for a scheme to remove older animals from the market. I am glad to say that the initial response was reasonably positive. I shall certainly pursue the matter tomorrow.
Mr. Michael Stephen (Shoreham):
If the European Union ban on British beef exports turns out to be illegal, as we believe it to be, will my right hon. and learned Friend ensure that compensation for the enormous damage done to British farmers is paid not by the British taxpayer but by the 14 European Governments who supported the ban? If they will not pay, will he give the House an undertaking that he will deduct that amount from our next payment to Europe?
Mr. Hogg:
My hon. Friend's suggestion has a great deal of support in the House.
Mr. Alex Salmond (Banff and Buchan):
The Minister was dealing with intervention buying. Can we be clear that he is saying that he will remove the blockages in the system, which make widespread intervention buying impossible under the present circumstances? Will he give the House a commitment that he will deal with the problem on the scale that will be required, not just for farmers--although that problem is very serious--but for abattoirs, where stores are building up? Does he understand that he has to remove those blockages if anything is to be left when consumer confidence returns?
Mr. Hogg:
The hon. Gentleman is right to refer to the blockage associated with the intervention scheme and to draw attention to the possibility of enlarging the categories capable of coming into intervention. Those are precisely the sort of issues that officials have been discussing in Brussels, and they are issues that I expect to raise with Commission officials and the Commissioner tomorrow.
Mr. Cynog Dafis (Ceredigion and Pembroke, North):
Will the Minister elaborate a little on whether intervention will apply to carcases that are in slaughterhouses, which are causing an enormous cash flow problem as slaughterhouses have had to pay for animals at high prices and are not able to get rid of them? Will he express his appreciation of the importance of abattoirs, including smaller and medium-sized abattoirs, for the local economy, particularly those in areas where there is no oversupply of such institutions?
Mr. Hogg:
I am not sure of the accurate answer to the hon. Gentleman's question about whether intervention can be applied to carcases or only to live steers. My right
Mr. William Ross (East Londonderry):
Is the right hon. and learned Gentleman aware that a lot of beef went from Northern Ireland to Europe but was sent straight back again? It is sitting in stores in Northern Ireland, which are almost jammed solid. What will happen to the intervention, if any, for Northern Ireland? Where will it go and how does he expect abattoir owners to survive? They have already paid for that stock and have no money left for anything else. That problem must be dealt with; otherwise, there will be no beef and abattoir industries left.
Mr. Hogg:
The hon. Gentleman asks two important questions. The first relates to the ultimate destination of any meat that may be in warehouses or slaughterhouses and the ultimate destination of any meat that comes into intervention. In a sense, that depends on the state of consumer confidence--and thus market confidence--at the appropriate time. Obviously, there are a number of possibilities. Either the meat can be sold for human consumption or it cannot. Everything will depend on the state of the market when the meat leaves storage or intervention facilities.
Sir Patrick Cormack (South Staffordshire)
rose--
Mr. Hogg:
I would like to deal with this question, after which I will give way.
On abattoir owners, I have already told the House that my right hon. Friend the Prime Minister is very aware of the ramifications that the crisis could have, not only for farmers--although very importantly for them--but for people across the spectrum of industry and the rural community. He has asked my right hon. Friend the Lord President of the Council and other ministerial colleagues to address those problems with a view to making any proposals that may seem appropriate.
Sir Patrick Cormack:
Does my right hon. and learned Friend agree that, to restore confidence, both at home and abroad, we must soon reach the stage where the only beef on sale is from BSE-free herds and that people know that? Is he working towards that end?
Mr. Hogg:
There are some problems of definition about how to address that question. My hon. Friend raises the basic question of how to restore consumer confidence, which would lead to a restoration of market confidence. That may involve measures that go beyond those already outlined, which, in our judgment, are all that are required by the scientific evidence. However, that is not to say that we may not have to explore further measures. I will give way to my right hon. Friend the Member for Conwy(Sir W. Roberts), after which I will make some progress.
Sir Wyn Roberts (Conwy):
While I appreciate the immediate and medium-term steps that my right hon. and learned Friend is taking, I am concerned, as was my hon. Friend the Member for South Staffordshire(Sir P. Cormack), about the restoration of confidence,
Mr. Hogg:
Yes, indeed we have. My right hon. Friend will remember the SEAC recommendations that were the subject of the statement on 20 March and its recommendations that dealt with the use of ruminant protein in feed rations for farm animals. He will recall that I have announced today an order prohibiting the incorporation of mammalian protein into feed rations for all farm animals. That is believed to be a most effective way of reducing the incidence of BSE. That is not to say that it will be the only thing that we do, because we clearly have to consider proposals from elsewhere and we will. But that is an important step designed to achieve precisely the objective that my right hon. Friend has identified.
Mr. Bill Walker (North Tayside):
The National Farmers Union of Scotland will be delighted with my right hon. and learned Friend's proposals on intervention because it recognises that agriculture depends on a credit system. Unless we can unclog the finance, as well as the carcasses at the abattoirs, we will not remove the problem. His speech will be welcomed by the National Farmers Union of Scotland.
Mr. Hogg:
I am awfully glad that I gave way to my hon. Friend.
Mr. John Greenway (Ryedale):
I appreciate the line that my right hon. and learned Friend is taking. I have two questions on intervention. Will all cattle that will go to market, or would have gone to market, be included in any intervention arrangements? How quickly does he expect those arrangements to be in place? The news from North Yorkshire is that, unless they are in place in three or four days, the market will completely collapse and many farmers and other related business will face ruin.
Mr. Hogg:
My hon. Friend is right to emphasise the urgency of the position. He will know that the intervention system is intended for young steers and not, if I may put it like this, for the elderly dairy cow. The elderly dairy cow, or any other elderly cow that might become destined for the beef market, is a problem that we may have to address in other ways that will not strictly be under the intervention scheme that he has in mind. I will discuss this and related problems in the course of my meeting with Commissioner Fischler tomorrow.
I very much welcomed Commissioner Fischler's statement that he would consider means of assisting farmers to overcome the present crisis. As I have said, officials from my Department are in Brussels to discuss with the Commission how best to restore market confidence. I propose to follow up those talks tomorrow. Part of those discussions will include the financial support that may be necessary as a result of the present market turmoil and of any additional measures on which we may agree. We look to the European Union to play its part in resolving this crisis.
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