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9.15 pm

I do not wish to go over at length the points that my hon. Friends have made, but I emphasise to the Minister that, apart from clause 1, which establishes the offence, this is clearly the most critical clause. The Government have moved forward from the position in last year's private Member's Bill. I am grateful for that and readily acknowledge it, but it is imperative that the amendment to substitute "shall" for "may" be included in the Bill.

I have listened carefully to the Minister on numerous occasions on the subject. I think that that total commitment is still not there. The provision is not strong enough. Reassurances are needed. The amendments go significantly towards filling that gap. I hope that the Minister will seriously take them on board.

Mr. Paterson: This is the most important subject of the Bill. It is the first time I know of that a Government have wilfully closed a legitimate business activity which is flourishing in the rest of Europe. For example, fur farming accounts for perhaps 4 per cent. of Danish gross domestic product. I pick up on the comments by my right hon. and learned Friend the Member for Sleaford and North Hykeham (Mr. Hogg). It is important that the Bill has clear provision on a fair and comprehensive compensation scheme, or the Government risk running into fearfully expensive legal actions in Europe.

I pray in aid the National Farmers Union, which as we all know is a non-political organisation. It has made it clear in letters on the subject, including one that I received in January that

Should this legislation proceed it is therefore imperative that the individuals concerned are treated fairly.--[Interruption.]

The hon. Member for Liverpool, Garston (Maria Eagle), who promoted the private Member's Bill, is laughing. There are people who have built up businesses for 40 years. It is their life's work. There is a business in the west country that employs 40 people. I do not think that it is a laughing matter. Because she finds the activity distasteful and hides behind the idea that it is publicly immoral, she wants to close it down. The one thing that we must do--

Mr. Deputy Speaker: Order. The hon. Gentleman is already starting to stray. I should like to bring him back to the terms of the amendment, which is about compensation.

Mr. Paterson: Absolutely, Mr. Deputy Speaker. What I am objecting to is that the hon. Lady is laughing at the discussion on compensation.

Mr. Deputy Speaker: Order. There is no need to repeat the point, which I have just ruled out of order.

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Mr. Paterson: Moving on to the Europeans, who will pick up the matter if the Bill is not fair? I have talked to Wim Verhagen, chairman of the European Fur Breeders Association, who is adamant that it will take the measure to the European courts if there is no fairness in this country. I pray in aid Helge Olsen, manager of the European Fur Breeders Association, who made it clear that it would be extremely damaging for the industry in Europe if the measure went ahead. They are concerned about compensation in this country.

The only reference to sums of money is tucked away on page five of the explanatory notes. Under the heading "Financial effects of the Bill", paragraph 26 states:

It is estimated that the cost of compensation under the Bill for the current thirteen mink farms could, in respect of assets, be up to £400,000 and perhaps four times that amount if income were to be compensated.

That figure laughably underestimates the true cost of the measure. From a few brief conversations that I have had, it is clear that that would not pay to close even one farm. A farm in the west country has had a quote for £2.6 million on the plant and assets alone. It has had an independent assessor in. The estimated loss of income is £1 million a year. There is the question of returning the site to a green field because the buildings will incur rates. Those buildings will have to be demolished, a point that the Minister might like to pick up. The cost of demolishing the buildings on just one farm would be £100,000.

Therefore, I estimate that that farmer alone would look for at least £3 million to £4 million, which is a large sum. The man has built up the business over 30 to 40 years and invested not only in its physical assets. Fur farmers have invested substantially, although investment has come to a halt in recent years because the Government have said that they would not compensate farmers for that.

As my right hon. and learned Friend the Member for Sleaford and North Hykeham pointed out, the stock is valuable. Farmers have bred the animals, created a brand and developed good will. The businesses have an international reputation. The Bill does not refer clearly to income and there are also the issues of redundancies, wind-down costs and loss making as wind-down takes place. I have already touched on rates and demolition costs, but there is also interest and fees, which we discussed in Committee at some length. They constitute substantial costs and the figure in the explanatory notes cannot possibly be anywhere near accurate,

As a further guide to the figures' inaccuracy--

Mr. Deputy Speaker: Order. I have tried to help the hon. Gentleman, but this is not the appropriate moment for a general discussion about compensation. The debate is about the specific terms of the amendments. I would feel a little more comfortable if he directed his remarks towards the amendments.

Mr. Paterson: Thank you, Mr. Deputy Speaker. The amendments would provide much better terms of compensation than are currently in the Bill. That is the most important point that we are discussing. Will the Bill offer a satisfactory compensation scheme? My answer is no. Would the amendments, as tabled by my hon. Friend the Member for North-East Cambridgeshire (Mr. Moss), improve it? The answer is yes.

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I have cited one example that shows that the Bill is simply not adequate as it stands. It will not cover all the costs that I have mentioned. A farm in Austria is the only one in Europe that has been bought out and it cost 4.7 million Austrian schillings to do that. The cost was the equivalent to about £400 for each breeding female. The Bill does not refer to anything like that sum. It does not provide a mandatory compensation scheme.

Mr. Deputy Speaker: Order. I do not think that the hon. Gentleman has taken on board my advice. He should consider not the general amount of compensation, but the mechanisms for compensation that are at the heart of the amendments. He must direct his remarks to the scheme that is proposed in the amendments.

Mr. Paterson: I was saying, Mr. Deputy Speaker, that the Bill does not provide for an adequate scheme. As it stands, it would not come up with anything like the figures that have been proved necessary elsewhere. The figure in the explanatory notes is simply not adequate.

Mr. Deputy Speaker: Order. The hon. Gentleman must take on board my advice. We debate within the Standing Orders of the House and he must follow certain rules. He cannot go outside those rules in the way that he is seeking to do. The amendments have a narrow scope and he must focus on that.

Mr. Paterson: Amendment No. 8 would provide for an independent advisory body. That would provide a more viable basis for compensation. It would touch on some of the aspects that I have mentioned. The proposed subsections (a) and (b) in the amendment touch on professional fees and interest payments, and it also refers to buildings. Those are the most important issues for the farmers who have built up their businesses over the years. They need a thoroughly fair and transparent compensation scheme. The amendment would provide for that.

The only figure that is currently referred to is in the explanatory notes. The Treasury will run rings round the Minister. The compensation offered is not satisfactory.

Mr. Clifton-Brown: Some of the provisions were discussed in Committee, but the replies that we received, although courteous, were not satisfactory in substance. Our concerns therefore need airing again on Report.

On amendment No. 5, as my right hon. and hon. Friends have said, it is essential that in clause 5 the word "may" should be replaced by "shall", otherwise there is no obligation on the appropriate authority to produce a compensation scheme. That would be appalling. I see no reason why the Government should not accept the amendment.

Maria Eagle: I am grateful to the hon. Gentleman. The right hon. and learned Member for Sleaford and North Hykeham (Mr. Hogg) first made the point, but perhaps I can try again to explain. Clause 5(1) already provides for the Ministry of Agriculture, Fisheries and Food in England to make a scheme, through the use of the word "shall". In Wales, that would be a matter for the National Assembly, but there are at present no fur farms in Wales for which a scheme would have to be made. Although one can see the point of the amendment, it is defective. Does the hon. Gentleman not accept that?

Mr. Clifton-Brown: I entirely accept what the hon. Lady says. The amendment is defective. That shows how

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carefully one needs to read an amendment before appending one's name to it. Nevertheless, the spirit of what we tried to achieve through the amendments is clear. If we had the access to the parliamentary draftsmen that the Minister has, I am sure that such an elementary mistake would not have been made.

Before I am led too far down the path of temptation and ruled out of order, Mr. Deputy Speaker, I shall move quickly on to amendment No. 8. Many aspects of the amendment were covered in Committee, but there are one or two that I shall discuss. On the aspects that we raised in Committee, the Minister said that they would be subject to consultation; and that the Bill would provide for them if the Government considered it necessary; but that the Government would give no guarantee that the Bill would provide for them.

That is an unsatisfactory way in which to proceed. As I said on the previous group of amendments, we must be clear in the legislation that we pass. People's livelihoods are to be taken away. It does not matter whether one approves of their livelihood or not. The fact is that we are taking away people's livelihoods and they deserve to be compensated.

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