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6.17 pm
Mr. William Cash (Stafford): I want to refer to some of the criticisms--they might be called accusations--that are being made about how the so-called anti-Europeans, who are in fact Euro-realists, have regarded the beef crisis. I want to draw attention to the recent remarks of Mr. Geoffrey Martin of the European Commission on the "Today" programme. He said that the European Commission was going to meet 70 per cent. of the cost of the measures. Unfortunately, that is not correct. One might even say that it was misleading. Anyone who has read Agra Europe of 4 April will know:
- "the EU can claim to be paying 70 per cent., of the cost, while after taking account of the rebate, the net payments are only 25 per cent."
Yesterday, when he opened the debate, my right hon. and learned Friend the Minister said:
As my right hon. and learned Friend the Minister clearly admits, if we go for a policy of enlargement, that will require reform of the CAP. Why on earth, then, is the CAP not being put at the top of, or as a prime item on, the agenda for the IGC? We cannot continue to say one thing and do another. That is the problem with so much of the Government's policy on Europe--and the Opposition share that problem. Whether it is on the Maastricht convergence criteria, monetary union or CAP reform, we are faced with the extraordinary sight of collusion between the two Front Benches.
The Euro-realists are the only people who are putting forward serious arguments to deal with the practical questions, whether on the Conservative or the Opposition Benches. We are then accused of trying to stir up anti-European sentiment--when we are trying to deal with the practical questions. For good measure, we are blamed for and accused of trying to create divisions within our respective parties, which is nonsense. We are coming up with practical questions all the time. The beef crisis is an example.
We must arrive at a solution that will help farmers.I have had telephone calls from farmer after farmer, starting at 6 o'clock this morning. I had lengthy discussions with them yesterday. They felt, and still feel, intensely impatient about the way in which all this is being conducted. I do not want to be unduly critical of Ministers, but it has been suggested to me that considerably more farmers might commit suicide than people might have died from CJD. We must not underestimate that problem, because the farming community gets rightly sensitive about the vast accumulation of burden that is being imposed on it. This is the worst crisis to hit the farming industry for generations, and that point must be taken seriously.
How effective are the Government being with the crisis? I hear the Minister of Agriculture saying that they want to act sensitively and by negotiation and persuasion. We then hear that there are to be retaliatory measures. Then we find that there are not. Once again, I must repeat that there is nothing illegal about proposing to suspend payments to the European Union in return--a sort of Poitiers return--for what it is doing to us. It is not a ban, but illegal sanctions that are causing untold damage not only to our farmers but to many other people in downstream industries. We must tackle the problem in a serious manner. Suspending payments would bring the EU seriously to the negotiating table. It would not be illegal. It would simply interfere with the cash flow arrangements, which are set out with a two-year span between commitments and payments. We should bring the EU to the table by taking effective action instead of just talking and talking.
We have spent most of these debates discussing the beef issue, but we should also consider the CAP and set-aside. I spent five or six hours with the Court of Auditors recently as a member of the Select Committee on European Legislation. It became crystal clear that the arrangements in hand for dealing with fraud are woefully inadequate, despite the good efforts of the court.
During the passage of the European Communities (Finance) Bill, I made some proposals that were supported by 30 hon. Members and I got an undertaking--given on the instructions of the Prime Minister--from the Paymaster General that the national Parliament, in particular our Public Accounts Committee, should be
given the means properly to investigate European fraud in the United Kingdom. I put that to the Court of Auditors and I am given to understand that it is taking the matter seriously and will be discussing it with the chairman of the PAC and Sir John Bourn, the Comptroller and Auditor General.
If we are to deal with the level of fraud that exists in the Community, we must put in place proper systems to enable it to be done. A culture problem exists because of the accountancy methods of other member states and those of the United Kingdom, as the Court of Auditors explained quite graphically to us. I would describe that problem in this way: there are politicians, businesses and companies on the continent that do not want anyone to have the faintest idea about how much they are ripping us off, and the Public Accounts Committee actually does the job properly.
That problem is another item that should be on the IGC agenda, because the fraud is massive. We are told that it amounts to around £6 billion a year, but if we take into account not only criminal fraud, but financial irregularity, it amounts to much more. That is another matter that needs to be tackled.
Finally, if we are going to be realistic, we must get the fundamental issues on to the IGC agenda--
Mr. Deputy Speaker (Sir Geoffrey Lofthouse):
Order. The hon. Gentleman's time is up. I call the hon. Member for Aberdeen, North (Mr. Hughes).
Mr. Robert Hughes (Aberdeen, North):
First, I must make a few general remarks about the common agricultural policy. There seems to be universal agreement that the CAP needs radical reform. It is recognised that it is expensive and that it concentrates subsidy income in the hands of the largest and most prosperous farmers. Indeed, the word "farmer" now seems a most inappropriate description. A better one might be "agribusinessman", because that is what they are.
The trend towards greater output per acre, with increasing use of pesticides and fertilisers, is already affecting our environment. There are strong signs of pollution of the water table, apart from the known pollution of the rivers. So it is generally recognised that major changes are necessary.
I accept that a modest start has been made on the road to reform, but there is no great sense of urgency in tackling those problems. The fact that there is so much agreement yet so little real desire for change reminds me of the saying of St. Augustine:
One of the other charges made against the CAP is that it encourages over-production, but one should exercise caution before condemning all over-production. In some commodities, such as grain, over-production is desirable and it can be dangerous to balance supply and demand.
A few days ago, I heard a report that world grain stocks are down to 30 days' supply. Two of the best grain belts in the United States of America have had bad winters--one a long, cold winter, the other a long, wet winter--and it is estimated that US grain production this year could be down to a third of what is usually expected.
I use those reports not to be alarmist, but simply to demonstrate the need for common sense when discussing over-production issues. I none the less believe that CAP reform is urgent, but fear that there is not much will in the Community to set the process in motion.
The issue that has dominated the debate in the past two days is the BSE crisis. It has exercised our minds in the House for the past eight weeks, and of course it has exercised the minds of the farming community.
Some hon. Members have railed against sensational reporting, and some have railed against the Opposition, blaming the Labour party for the problems. The latter proposition is preposterous. Both those charges are an admission that the Government have lost control--if they ever had control--of the situation.
I concede that many of the reactions to the BSE crisis have been irrational. A couple of days ago, I was speaking to some people who were sitting happily puffing away at their cigarettes. I asked if they were still eating beef, and received the reply: "Not likely. Not with all this BSE around." Yet the damage to health from smoking is well documented and scientifically proven. So there is a distortion of perception.
Happily, confidence is returning to the market, but the industry cannot begin to restore its fortunes until the export ban is lifted. The prospects of a full lifting of the ban are not improved by the feelings of frustration at the chaotic start of the slaughter process that are evident from the criticisms by the farming community.
The Minister spent much time today detailing what he had done and meetings that he had had, yet, as yesterday--I do not think opinions have changed since--the feeling was that he got off to a bad start and was likely to get worse unless some big improvements were made.
I do not want to do or say anything that will damage recovery. All I want to say is that traceability of cattle movements must be rigorously enforced. If we choose the route of quality assurance schemes, the claims of quality and origin must be watertight. In future, the farming community and the Government must accept that regulation is not a bureaucratic impediment but an essential for the health of the industry and--perhaps more important--the health of the consumer.
There are grave injustices in the compensation scheme. The Minister of Agriculture has said that £1 billion has been set aside for compensation. That is a considerable amount. The Prime Minister went further in Aberdeen last weekend, when he again used the figure of £1 billion, but said that the figure might well be higher, and that, if it was higher, the money would be found. It would be remarkably good to do that, but who will gain access to compensation?
Yesterday, the Minister of Agriculture said:
Mr. Troupe received a fax message from the Scottish Office, ordering him to cease trading forthwith--not in a couple of days, a week or a couple of weeks, but forthwith. His business is gone. His employees have no job. There are no jobs running around begging in Aberdeen; it is prosperous, but there are not many jobs on the oil rigs, where everyone supposes that there are stacks of jobs, for people made redundant from this trade. All attempts to obtain a sympathetic hearing and a practical response have failed.
Yesterday, the Minister also said:
The difficulty is that people in Mr. Troupe's category and others have no breathing space to adjust to the changes in the marketplace. That is it--finished. The Government said in their defence--I accept that there may be something in it--that they could not extend the compensation scheme to everyone who might have a claim, including the local corner shop. Of course one understands that. We have been around this course before regarding who gets compensation.
"the process of enlarging the European Union should present an opportunity for further reform"--[Official Report, 15 May 1996; Vol. 277, c. 968.]
of the common agricultural policy. The problem is that the Government know perfectly well that the main driving force of European policy for the intergovernmental conference is meant to be with respect to enlargement. It is no secret that I would like the single currency and all the fundamental issues put on the IGC agenda. I said so to the Prime Minister at Prime Minister's Question Time about 10 days ago. The common agricultural policy is part and parcel of the essential practical reforms that will be needed if we are to have a realistic and working European Community of the type that I described when I wrote a paper on the future of Europe at the request of the then Foreign Secretary, my right hon. Friend the Member for Witney (Mr. Hurd) in January 1991.
6.28 pm
"Give me chastity and continency--but not yet."
The resistance to change is caused by the large number of vested interests. I sometimes think that the common agricultural policy would be better described as the "communal assistance policy", because that is what it really is. That is what makes change slightly more difficult.
"We have therefore targeted resources on the critical links in the chain, so as to provide a breathing space during which the sector can adjust to the new market circumstances. To achieve this, we have committed around £1 billion in support of farmers, renderers, abattoirs and cutting plants."
16 May 1996 : Column 1123
I am glad that my hon. Friend the Member for Monklands, East (Mrs. Liddell) raised again today the issue I raised yesterday with the Minister of Agriculture of Mr. John Troupe of T and T Meats of Aberdeen, who dealt in ox heads. I draw attention to a specific problem that the Minister must tackle. Dealing with ox heads is a licensed trade, carried out throughout Scotland and probably in other parts of the UK. I understand that, in Scotland, about 100 jobs are involved.
"There are others who have suffered loss--hauliers, processors, shops and retailers. I know perfectly well that people have lost their jobs, and I have the utmost sympathy for them--this is a beastly business."
I am sure it was not intended to be a pun.
"But we cannot pay money to everybody who has suffered loss. Therefore, we must define the principles on which we are to operate, and they are those that I have outlined to the House on this occasion and on others."--[Official Report, 15 May 1996; Vol. 277, c. 977.]
Earlier today, the Minister of State said that he did not wish to move beyond precedent. Precedents are there to be broken, not the bedrock of which nothing should be shifted.
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