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11.18 am
Mr. Paul Tyler (North Cornwall): I did not expect to be called so soon in the debate. On behalf of my colleagues, may I thank the hon. Member for Weston-super-Mare (Sir J. Wiggin) for not only the report but his leadership of the Committee over a number of very difficult years for the industry, and the way in which his particular advocacy of the industry has informed debates in the House? I found the report so helpful that I shall confine my remarks to the points made in it. They will therefore follow the report's format.
In paragraph 37, the Select Committee says very firmly:
There will have to be a triple-track approach to the issues with which the Select Committee has been concerned. First, the hon. Member for Weston-super-Mare referred to the subject of the national quota. Clearly, it would be totally unsatisfactory if other countries bid for more quota in the coming years and Britain did not make its claim as well. It may be that the total pool of quota is not going to change, but it would be devastating to British agriculture and to the dairy sector in particular if the same pool were sliced up, if a pool can be sliced up, in a way that is unfair to British producers. That is one of the major concerns of the farmers unions throughout Britain. If other countries are going to bid, we must be in there too--that is track number one.
Secondly, if there is to be some transition towards a new quota regime--a much lighter regime, perhaps--after 31 March 2000, it follows that, during that transition, there will be an urgent need to harmonise the existing different regimes in different member states. Ours is perhaps the exception that proves the rule. Ours is exceptional in terms of the speculative value that is attached to quota here, which has had a devastating effect on new entrants in particular, but has also damaged those who are seeking to develop in this sector.
Other countries have managed to avoid that speculative element. Members will recall, because our postbags were full of it, that, just two years ago, we were told that football clubs, pop stars and redundant Cabinet Ministers were all investing in quota because it seemed to be the best product for a quick return. We know that they did not, but that is not the point. The very fact that there was speculation about speculation caused a speculative price. Unless we can get away from that position, it could return.
It would be devastating if we were to find that we were the ones that were out of step in a transitional period that could otherwise benefit other competitive countries.
Mr. Ieuan Wyn Jones (Ynys Mon):
One of the reasons why those companies were not able to speculate was that the quota remained attached to the land. The difficulty that the hon. Gentleman mentions is that, if quota were detached from the land, that speculation could take place.
Mr. Tyler:
I am grateful to the hon. Gentleman. There is a consensus that detaching quota from the land would be a backward step. The Select Committee made that point and the Government in their response made it too. No one is now suggesting that, but there must be some way in which the management of quota is more effectively undertaken in the public interest, not just in the industry's interest.
Mr. David Harris (St. Ives):
What exactly is the hon. Gentleman's party's policy on the future of quota? Is he in favour of abolishing it, phasing it out or keeping it?
Mr. Tyler:
There is absolutely no question of quota being abolished. It would not be possible for Big Ben to strike midnight on 31 March 2000 and the quota to go completely. No one in Europe wants it to go like that, but, clearly, there will have to be a new regime. My point is that Britain must be in those negotiations to ensure that the transition is not to the disadvantage of our industry and to the advantage only of our competitors.
Thirdly, the Select Committee considered seriously and very well the issues of cross-border quota trading and cross-border balancing. That is the third track that we should be pursuing because, if there is to be a different regime after 2000, it will have to be on a much wider basis than the present national basis. There is room there for some horse trading to ensure that other countries recognise the value of that. If we run all three tracks at once, there is a chance of making progress. That is the view of many in the industry not just in Britain, but in some of the other member states, which share our view.
Here is an example. In the past, the British veto was perhaps necessary to preserve the position of British agriculture in common agricultural policy reform, but with the enlargement of the European Union, there may be more allies there and in future the Greek or Portuguese veto may hold us back from reform. That could be an area where majority voting may be to the advantage of Britain and its farmers.
On two-tier quotas, I have carefully considered the report and I have heard a great deal elsewhere too. Recently, I spoke at the conference of the Royal Association of British Dairy Farmers in Malvern. I heard some convincing arguments for reconsidering the issue of two tiers. It will not be easy--I do not think that anyone could deny that--but, after 2000, that may be the way in which we get some fluidity into the cross-Europe milk quota system. We should not discard it as readily as the Select Committee appeared to do and as the Minister did even more. I fear that farming unions are perhaps putting their heads in the sand in anticipating that it is a non-runner. It may be a runner for other EU states as well as ourselves.
On support prices and compensation, I notice that, in paragraph 66, the Select Committee says firmly:
I want to move from quota to other wider issues that the Select Committee wisely felt it had to consider, but in passing I must make the comment that I think that this is the first time that anyone in the House on an official basis or indeed anyone outside has placed such a neat summary on the record of what happened with the 1992 CAP reforms. In paragraph 79, the Select Committee said:
On the way in which any compensation regime should be introduced, I take seriously the comment in paragraph 80 that any attempt to introduce some form of modulation that could result in distortion is dangerous. The Select Committee is absolutely right. I hope that today the Minister will tell us that, in approaching the issue of modulation in any future negotiations, it will be central to the British Government's position that modulation, if there is to be any, must be a matter for derogation, so that it can be appropriate to the particular circumstances of each member state. I suspect that it will come down the track sooner or later. It may not come in 2000, but sooner or later it will come, simply because of taxpayer resistance throughout the EU. If that is to happen, clearly subsidiarity must be the order of the day.
Before I leave the subject of the dairy sector and its marketing process, I have to say that the Chairman's remarks about the relationship between Milk Marque and the Dairy Industry Federation were apt, appropriate and extremely topical as a result of the cuts in pricing in the past few weeks. There is concern that the oligopoly among the dairy companies is just as likely to be a threat to competitive forces in the industry, and to the consumer's interest, as the position of Milk Marque, which after all does not have a complete monopoly--the situation is very competitive.
In the past few days, I have been disappointed that the Labour party--in a classic attempt to make post hoc propter hoc the basis of its policy--has started again to say that the creation of Milk Marque has destroyed the doorstep pinta. That is absolutely ludicrous, because we all know that the doorstep delivery of the pinta has gone for many social and economic reasons. I give the example of my own home. I am not there that often now, and my children are grown up. Our doorstep pinta eventually ceased when the milkman was no longer prepared to deliver a pint every other day, because it was not worth his while. Increasing numbers of women are going to work and realise that they do not want a pint sitting on the doorstep, going bad during the summer or demonstrating that the house is empty, and people inevitably have chosen other means.
The doorstep pinta did not suddenly disappear because the House passed a law; it was part of a general social trend. It is quite absurd--it is essentially taking a dinosaur approach to social trends--for the Labour party to pretend that the pinta disappeared because we introduced a new form of milk marketing. That is ridiculous, and it shows how out of touch the Labour party is with reality.
Some extremely important issues were not given quite so much room in the report. However, we should give them some attention now, because they have loomed large in our affairs since the report's publication. I noticed the comment on the over-30-month scheme, in paragraph 150, which states:
Since then, at long last, the selective cull proposals have been presented to us, to the Commission and to other member states. In its report--which was published before the details of the proposals were known, although the rough parameters were--the Committee states:
"we would expect Ministers to take a very robust stand before and during negotiations."
Many hon. Members, I think on both sides of the House, believe that, because of the distractions of internal problems with which the industry and therefore the Ministry have been faced in recent years, far too little attention has been given to the United Kingdom's position in those crucial negotiations over the future of this sector of agriculture. I endorse the Select Committee's view that a much more robust attitude will be necessary in the new Parliament. When and if there is a new Government, a different attitude will no doubt be taken, but the importance of the negotiations cannot be underestimated.
"The NFU's position was in stark contrast to MAFF's."
I hope that we will find that those positions come together, because it is critical to the future prosperity of this sector.
"To avoid the problems of 'over-compensation' which have occurred in the arable sector following the 1992 CAP reforms, the level of compensation payable should be automatically adjustable to take account of fluctuations in world dairy prices."
Hon. Members on both sides of the House must all accept now that the so-called Gummer reforms of 1992, which placed no cap or adjustment mechanism on the arable aid payments and which paid no attention to world cereal prices, were a disastrous mistake. They have drained away from the CAP budget huge sums of money, which both the taxpayer and the rest of the industry do not feel is justified.
"it would be unduly harsh to be over-critical of the delays associated with getting the scheme up and running".
Surely that is the understatement of the century. Being "over-critical" reflects the fact of life. Everyone in the dairy sector and in farming knows that the scheme was a shambles, and it was rightly categorised and castigated as such at the time.
"In our judgment, it lies at the boundaries of political acceptability."
The Chairman did not refer to that paragraph--which is also an understatement--in opening this debate.
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