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Mr. Collins: The Minister will know that one of the issues for the successor bodies to Milk Marque is whether they will be allowed to go into processing. That is dependent on a decision that rests with the Secretary of State for Trade and Industry, who in turn has to wait for advice from the Director General of Fair Trading. The Select Committee was told that that would arrive some time near Easter. Does the Minister have any further information on an issue about which the dairy industry is waiting desperately to hear?

Ms Quin: I understand the anxiety of the dairy industry and dairy farmers about that matter, but the hon. Gentleman pre-empted my reply. The timetable is as he describes, and I cannot add anything to that this evening.

Government action has taken place on several fronts, despite the limitations on the Government, especially in terms of price setting and other forms of intervention. I am glad that the hon. Gentleman recognised those limitations. Some issues have had an effect on the dairy sector. When I first became an Agriculture Minister, dairy and cattle farmers were very worried about the impending introduction of cattle passports. We have alleviated that burden by deferring payment for the passports for two and a half years, and that will save a significant amount of money.

We have also undertaken to provide help to make it possible to have a generic promotion campaign for milk. That is important, because it is a long time since we have had such a campaign. All of us will remember the effectiveness of campaigns such as "Drinka pinta milka day", the bottles of milk dancing on to the doorstep and "Milk has gotta lotta bottle". They had an effect. I do not underestimate the potential of that, and I am glad that the processing side of the industry is committed to matching the sum raised by producers, so that a sizeable promotional campaign can be mounted. Clearly, we shall monitor that closely to see how effective it is, but Ministers are very committed to a project that has been welcomed by hon. Members of all parties.

The Government also support the continuation of European Union school milk scheme. That has been under threat, as the European Commission is looking to reduce its budget in all sorts of ways. The EU school milk subsidy came in for especially close scrutiny. My right hon. Friend the Minister spoke strongly about the matter in the Agriculture Council and received support from other Ministers. The plans to abandon the subsidy have

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been shelved for the moment, although we must remain vigilant and continue to build alliances with other countries to try and ensure that the scheme can survive.

The hon. Gentleman specifically mentioned the importance of trying to get people in the dairy food chain together, and we agree. The hon. Gentleman will be aware of the food chain initiative that my right hon. Friend the Minister set in motion. It involves senior figures from MAFF, the National Farmers Union, the Food and Drink Federation and various retail groups, and its report showed that it is conscious of the importance of trying to get the various parts of the food chain working together.

The tensions and difficulties that exist between sectors were very well documented in the report from the Agriculture Committee. We shall study that report's recommendations in detail, but we also want to build on the momentum of the food chain initiative to achieve greater understanding of the pressures and constraints on each part of the food chain.

It is not true that there is no passing on of lower prices at the retail end, but there is a time lag in what is a slow and modest process, and I understand the frustrations of farmers who suffer as a result.

The investigation by the Competition Commission is also relevant and, when the elements of the food chain appear not to be co-operating, the commission is available to help. I can assure the hon. Gentleman that the Government are keen to make progress on both aspects of the food chain.

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The hon. Gentleman also asked about the rural development regulation, and about how that might relate to small dairy farms. We hope that the various measures announced last December by my right hon. Friend the Minister as part of the rural development regulation and its implementation in this country will help the dairy sector.

I was pleased that the recent round of marketing awards under the agricultural marketing development scheme went to some innovative projects from the dairy sector. That justifies the way in which we have built on the agricultural development scheme in the rural development regulation to address some of the issues that the hon. Gentleman mentioned.

The hon. Gentleman also mentioned quotas. Our long-term approach in the European Union is for an orderly end to the milk quota system. We believe that the British dairy industry can compete in Europe. It has several natural advantages, such as good-quality pasture, and it has a good record with regard to quality standards.

However, many of the recommendations on marketing of product in the Select Committee report are well worth considering. I was also interested to hear some of the comments on the radio this morning from the president of the NFU. He spoke of the need for better organisation in the industry--

The motion having been made after Ten o'clock, and the debate having continued for half an hour, Mr. Deputy Speaker adjourned the House without Question put, pursuant to the Standing Order.

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