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Mr. Nicholas Winterton: My hon. Friend has mentioned the important role of cattle marts in this country, particularly in his constituency. Does he believe that there is a discrimination against cattle marts in respect of the live weight and dead weight criteria? Does he believe that some abattoirs are inviting farmers to deal directly with them rather than go through the collection points and cattle marts?
Mr. Atkinson: This is the market ruling, and I believe that in this case my hon. Friend the Minister is trying to achieve a balance between the interests of the livestock mart, of the abattoir and of the farmer. Abattoirs have traditionally and increasingly dealt directly with farmers, so it would be wrong to tell all those farmers that they must go via a livestock mart. However, those farmers with cull cows will obviously be encouraged to go through livestock marts and I suspect that many others will want to, because they will want the livestock mart to organise the transport of their cattle to the abattoir. Those with very few beasts will find it easier to deal with an auction mart--because the beasts can be collected into sensibly sized loads and taken to the abattoir on time--than to deal directly with the abattoir. The scheme will give the abattoir and the livestock mart something, and I hope that it will work.
It is early days yet, but my hon. Friend the Minister will need to start looking to the future. At the moment he has his head down, concentrating on today's problems, but, as we overcome those problems, new problems will arise. There is the prospect of a substantial fall in demand for beef throughout Europe. That will need to be tackled, because otherwise there will be surplus capacity of beef in Europe in the next few years.
Interestingly, the British have been almost the most robust about the beef issue. Our beef consumption fell initially to 60 per cent., but it is now back to 80 to
85 per cent. The Germans, whom some of my hon. Friends like to demonise in this regard, have suffered extremely badly in the sense that, after the first scare of BSE, only 30 per cent. of German beef eaters were still eating beef, and the percentage has only just crawled up to 50 per cent. The Danes, however, are also robust, and scarcely gave up eating any beef throughout the crisis.
Throughout Europe, beef production is scheduled to increase in the next few years, and if beef consumption fell by 20 per cent. and did not recover because of BSE--I fear it is on the cards--we are likely to produce a surplus of about 2 million tonnes of beef in the next few years, which will have to be dealt with by Europe.
Mr. Richard Alexander (Newark):
I pay a warm tribute to my right hon. and learned Friend the Minister of Agriculture, Fisheries and Food and his team. Since this crisis hit the country about seven weeks ago, they have worked tirelessly, night and day, to try to resolve the problem in Europe and in this country. No one could have worked harder.
I wish to place that on the record. I do so especially because, during my few remarks, I shall suggest that one or two things might have been done better. My hon. Friend the Minister of State has gone a long way toward resolving the uncertainty, difficulties and anxieties that our constituents have felt and that we, representing them, have felt for them.
We must accept that, as has been said, we cannot find rendering capacity if it is not there. Yet there has been deep uncertainty in the farming community about how the cattle disposal scheme will work for farmers as individuals.
The crisis has been with us for seven weeks. I had a meeting with senior representatives of the farming industry in my constituency on Friday, and they were still uncertain about how the cattle disposal scheme would work out for them in our county. The letter sent on Friday by my hon. Friend the Minister to them and to us should help, but it would be wrong if we gave the impression that the problems were over and farmers need have no further worries.
From the outset of the proposals, it has been the National Farmers Union's position, which I tend to share, that a better administrative framework or organisation is needed. Farmers need somewhere from which to obtain information and advice. Without accepting the point made by the hon. Member for North Cornwall (Mr. Tyler) about the 15-year-old child at the end of the telephone--
Mr. Alexander:
I am sorry. Without accepting that point, made by the right hon. Member for Berwick-upon-Tweed (Mr. Beith), I do say that the fact that it happened, although it may not be typical of what is happening throughout the country, shows that the system has not worked as well as it might have done, had someone taken on the organisation of the whole scheme. Farmers tell me that there is no one whom they can go to or ring up with reliability to find out what their position is.
I make that suggestion to my hon. Friend the Minister. He said that he did not want a dirigiste scheme, but something better needed to be done in the past few days.
We should shed a tear for some of the abattoirs that learnt last week that they would no longer be among those listed to be involved in the culling scheme. Two owners of abattoirs visited me on Friday. They had filled in all the forms; they had been inspected. They were told, as of last Friday, that they would be slaughtering 900 cattle a week.
I should say, in parentheses, that one of the problems that farmers in north Nottinghamshire have had--and especially the two abattoir owners, who are also farmers--has been that the letter that my right hon. and learned Friend the Minister of Agriculture, Fisheries and Food told the House on 1 May was being sent to all farmers did not reach them until Friday 10 May. That was the same day on which those two abattoir owners learnt by fax from one of their suppliers that they would no longer be in the scheme. They had had 10 days of uncertainty, and as soon as they received the information, they were told, by an outside source, that they were no longer on the list. I express concern on their behalf at how that happened.
I also express concern at the fact that the list has been reduced to 21. Every abattoir in Nottinghamshire, Derbyshire and Lincolnshire has been removed from the list. There never was one in Leicestershire. There is no abattoir in the entire east midlands--nothing from Harrogate to Shrewsbury.
Mr. Baldry:
This is important language. It is not a question of anyone being removed from the list. Those abattoirs are still designated collection centres, and I have no doubt that, in the very near future, they will be slaughtering under the scheme. As I hope I have explained to the House, to maximise the slaughtering and rendering capacity, it has been possible to use only 21 slaughterhouses at present, but the number will be increased, and I have no doubt that the abattoirs that my hon. Friend mentions will be involved in the scheme as it develops in the next two or three weeks.
Mr. Alexander:
That will be very reassuring; I am grateful to my hon. Friend. However, distances are a problem to the people in north Nottinghamshire and the east midlands.
There are other unacceptable consequences of the list being shortened. First, farmers now have to transport their beast much further, at their own expense, than, until Friday, they had believed that they would have to. Secondly, the beast must endure significantly longer journeys, and no farmer or welfarist likes to think that that is being done unnecessarily.
There seems to have been no strategic geographic consideration of where the chosen abattoirs are to be. The entire east midlands does not have one, yet elsewhere there are clusters of several within an approximately 50-mile radius. I urge my hon. Friend the Minister to consider more closely, if he can, where the abattoirs that have been chosen are situated.
Mr. Nicholas Winterton:
I support my hon. Friend in his remarks. The very large abattoir at Crewe has failed to make the appropriate arrangements with the Ministry
Mr. Alexander:
I shall comment on the way in which the situation has changed unacceptably for farmers, abattoirs and others who received other information initially. My hon. Friend makes a valid point.
I return to a point with which my hon. Friend the Minister of State dealt, but about which I remain uncertain. The system is unfair to producers who have always sold their stock live weight. Producers cannot support the live weight system. For example, a Charollais steer at 650 kg live weight is worth £718.90 and the same steer is worth £862.68 dead weight. That £143.78 shortfall is grossly unfair to the producer and to the auctioneer, who may be having a difficult time, with considerably reduced throughput and much reduced margins of profitability.
The slaughter scheme should not force live weight producers into the hands of the dead weight sector. Live weight markets provide an excellent service, with guaranteed payments on the day of sale. The slaughter sector is not as reliable, with eight or more abattoirs going bankrupt in recent years, owing millions of pounds to producers and to auctioneers. The auctioneers tell me that they do not want to be in the driving seat, but they want a fair system: their clients and their farmer customers should have a real choice in these difficult times. Without that choice, many more markets will shut, causing a dead weight monopoly in many areas. I am sure that no one wants that. Markets are the life-blood of many rural communities; people come to the towns to attend the markets. The market in Newark has the second largest livestock cattle throughput in the country--I make that point to my hon. Friend, because he told us about the cattle market in Banbury. I urge the Government to re-examine the unfairness of the present proposals regarding live weight and dead weight compensation rates, and I urge the Minister to make a change.
The system has changed for the farmer and for the producer in recent weeks, as instanced by the National Farmers Union in its briefing. Initially, the 25p per kilogram live weight top-up was to be paid for the first four weeks of the scheme. That is fair enough--if it had begun. Then it was to be paid during May, but it changed again and was to be paid until 10 June. The top-up will now be paid on all steers and heifers on farms aged more than 30 months as at 20 March. There may be grounds for making those changes, but they have caused great uncertainty within communities that have already suffered badly.
I shall not speak for too long as my colleagues want to contribute to the debate. However, I must refer to another issue in the NFU brief: the financial consequences for farmers. The delays in getting the scheme off the ground--that is what we are debating tonight: not whether Europe is at fault or whether my right hon. and learned Friend could have done things differently--have cost the farmers dear in feeding their animals and servicing their
bank loans. Some farmers who deal only in beef have received no income for the past seven weeks. I have referred in the House to a farmer constituent who has a throughput of 5,000 beef cattle a year: he has not sold one animal in seven weeks. Unless the sequence begins to move, the delays will lengthen.
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