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10.38 pm

The Parliamentary Under-Secretary of State for Scotland (Mr. Calum Macdonald): I congratulate the hon. and learned Member for Orkney and Shetland (Mr. Wallace) on securing this debate. I entirely agree with him about the industry's importance to Scotland, particularly its most fragile and remote areas. I welcome the participation of the hon. Member for Argyll and Bute (Mrs. Michie) in the debate.

The hon. and learned Gentleman made a number of points and I should like to get through as many as I can. On the agreement between the European Union and Norway, it is a measure of our commitment to the industry that one of the first things that the Government did last year--led by my right hon. Friend the Secretary of State for Scotland and my noble Friend Lord Sewel--was to intercede with the European Commission in the action initiated by the Scottish industry against its Norwegian counterpart for dumping farmed salmon on the Community market.

It is well known that we did not think that the action agreed by the EU went far enough--as the hon. and learned Gentleman said, it received a mixed reception--but, to its credit, the Commission has taken its responsibilities for monitoring and enforcing the agreement with the Norwegians seriously. The result has been that the Commission has imposed duties on 36 companies. A further three face a similar prospect, and, as a result of EU pressure through the agreement, the number of companies registered to trade has been reduced from 191 to 135.

As the hon. and learned Gentleman knows, the main aim of the agreement is to introduce a degree of stability in the salmon market. That involves imposing a minimum import price for salmon exported from Norway to the EU;

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requiring Norwegian exporters to register and exposing them to tariffs if they breach those prices; and requiring that part of the export tax imposed by the Norwegian authorities to be used for generic marketing of Atlantic salmon. The latter has taken time to settle and to organise, but I understand that a way ahead has been agreed, involving the industries of Scotland, Norway and Ireland. Today, a £4 million advertising campaign, funded by that export tax, has started in France, Germany and Spain.

Earlier this year there were signs that, at long last, the agreement was beginning to have the desired effect. Prices began to rise, offering Scottish growers some long-overdue promise of better times, but they dipped a few months ago, when the Norwegians placed sizeable quantities of small fish on the market. That was made worse by similar placements as a result of infectious salmon anaemia outbreaks in this country. We look to the price drop being reversed as the Christmas trade approaches.

The hon. and learned Gentleman mentioned the report of Norwegian producers using Denmark to get around the regulations. We were not aware of that, but we will investigate, contact the Scottish Salmon Growers Association and pursue the matter with the Commission. He also mentioned the impact of the pound on the agreement. It is up to the EU to renegotiate the agreement, but it is important to bear in mind that sterling has fallen against the deutschmark by 10 per cent. in the past year.

As the hon. and learned Gentleman made clear, ISA is a matter of concern. I agree with him that there is no evidence that the disease has any effect on human health. It was first confirmed at a farm on Loch Nevis on 15 May this year and since then there has been confirmation on 10 farms, including one in the hon. and learned Gentleman's constituency. The common denominator appears to be site-to-site contact, although the source is still a mystery. It is being investigated.

A further 11 farms are suspected of having the disease, including one on Shetland which has been cleared of its fish. As a consequence of all that, movement restrictions have been imposed over a wide area and 198 farms are currently affected. The last known incident was in September and I share the hon. and learned Gentleman's hope that the disease might have run its course.

ISA is classified as a list 1 disease under EU legislation, which requires that eradication action must be taken when the disease is confirmed. That entails a number of procedures, and fallowing of the sites for at least six months before restocking. Movement restrictions have been imposed over a wide area and a rigorous inspection regime is under way. This is the first time that anyone in the EU has experienced the disease and it is almost inevitable that our processes for handling it are being developed as time goes on. I stress, however, that we are in close contact with the Commission, which has expressed itself satisfied with the steps that we are taking.

I am conscious that the ISA outbreak is causing hardship, and that things could get worse if the suspected sites are confirmed or if outbreaks occur elsewhere. Already, there have been redundancies, and I am aware of the considerable concern that the disease should be contained.

I pay tribute to those in Shetland who have had to deal with the consequences of the outbreak. That response has been positive, and it has been recognised that without such

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action others could face a similar plight. I particularly want to pay tribute to Shetland Islands council, which has made available some £100,000 for disinfection of liquid effluent from salmon processors. I am also grateful to Shetland Enterprise for its £50,000 contribution towards that work, which is vital if reinfection is to be avoided.

The hon. and learned Gentleman said that producers have made an application for FIFG support. It is available into next year, but it is as well that they have put in their applications, because the last date for doing so is31 December. Most of the £5 million--£4.1 million of it--allocated to FIFG has already been awarded, so there is pressure on resources. The final round will be allocated early next year.

It is now almost two months since the last outbreak was confirmed. I know that everyone in the industry shares the hon. and learned Gentleman's hope that we are past the worst.

The problem of disposing of slaughtered fish in a small place such as Shetland could be severe. Thus far we have received considerable support from the Norwegian authorities in handling waste from infected farms, and we are grateful to them for that. We are exploring alternative arrangements should the need arise in the future.

It is precisely because of those problems that rigorous controls are being enforced. The total co-operation of all concerned is absolutely vital. As I said earlier, we are all learning lessons about the disease as time goes on. In the light of experience gained, we have introduced a graduated approach to the fallowing of sites within restricted zones, which reflects the disease risk in each case. It is important for all concerned to recognise and accept that we cannot cut corners.

The hon. and learned Gentleman spoke about the need for fish farmers to be encouraged to report disease early on. He suggested that a compensation scheme could be beneficial and that its application should be considered more widely. The industry has so far shown a responsible attitude, and I very much hope and expect that to continue, regardless of the compensation issue.

I assure the hon. and learned Gentleman that we are continuing to discuss all the options. However, it would be less than frank of me not to mention the fact that it has not been the policy of successive Governments to pay compensation for fish diseases. Indeed, we do not have the legislative competence, as the hon. and learned Gentleman knows from incidents of shellfish poisoning in his constituency. Equally, it is important to recognise that the issue is not simply one for the taxpayer; we need to

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explore the scope for the industry to recognise its obligation to address the financial consequences of the disease.

The hon. and learned Gentleman mentioned Gigha. In that case, the disease was viral haemorrhagic septicaemia, which is a list 2 disease for which the rules are different. A judgment in that case is the subject of an appeal, so I cannot comment on it further.

As for the hon. and learned Gentleman's point about medicines, I recognise the industry's concern that it is being denied the use of treatments available to Norwegian competitors. The use of medicines is a sensitive issue. Statutory procedures are laid down and must be observed. Nevertheless, we are conscious of the view that such treatments could overcome a number of problems, and I assure the hon. and learned Gentleman that we shall continue to seek to ensure that applications receive speedy attention.

The hon. and learned Gentleman also spoke about local authority involvement in the approval of fish farm developments. That reflects the Government's decision, after full consultation, that, subject to endorsement by the Scottish Parliament, local authorities should have formal planning responsibilities. We believe that outcome to be the right one: the issue is for local communities to decide, and they should have a say in the matter. There were many complaints in the past about the way in which the Crown Estate Commissioners handled the matter, and about the fact that local communities did not have a direct, democratic say.

To help in the process of consideration we have done what the hon. and learned Gentleman suggested, and issued draft locational guidance. Advice on environmental assessments, commissioned by the Crown Estate and the industry, has also been produced. Consistency across authorities is never guaranteed; but then it does not apply in other planning areas, and that is right in principle. Different areas have different priorities. The point to recognise is that, in addition to central guidelines for local authorities, there will be a formal right of appeal for applicants.

It is always difficult to respond to all the points in a debate such as this. If I have missed any out, perhaps hon. Members will bring them to my attention, and I will respond in writing. I congratulate the hon. and learned Member for Orkney and Shetland on securing the debate, and on clearly articulating the concerns and desires of the industry at what is undoubtedly a difficult time. I assure the hon. and learned Gentleman and the industry that the Government remain firmly committed to a fully sustainable fish-farming sector.

Question put and agreed to.

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