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Lord Carter: My Lords, the House will be grateful to the Minister for explaining the Milk Development Council Order so clearly. Like him, I should declare an interest as a registered milk producer and a potential levy payer. I certainly support, and my party supports, the idea of the Milk Development Council. I have long felt that the development council route was one that we should have followed in agriculture much more than we have. It is a good way of collecting the money that is needed for producers to carry out research and development and other activities. I am glad that the Minister has confirmed that producers will be in the majority and that they will have six out of 11 members of the new council, as the council will be funded entirely from the levy that is collected from producers. The trade will not be contributing.

The council is welcome. Formerly, the expenditure was in effect raised with a compulsory levy by the Milk Marketing Board. The Minister will remember that when we were discussing the Agriculture Act 1993 I said that I hoped there would be a Milk Development

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Council. I also hoped that there would be as small a gap as possible between the vesting day of the new milk system and the setting up of the Milk Development Council. As it happens, because—if I may use a phrase that we were using yesterday regarding the effluxion of time—the vesting day was delayed from April to 1st November, there will be a smaller gap, but we hope that the Milk Development Council can start as early as possible in the new year. It has substantial support from producers.

I wish the Minister to confirm one or two points. He is aware of them because I informed him that I would be raising them. Will he confirm for Hansard—he was kind enough to do so in writing—that the Milk Development Council will take responsibility for the valuable work of the animal data centre, which is not mentioned in the order? This gives me a chance to pay a tribute to its first chairman, Mr. John Moffitt, who has done an outstanding job in setting it up. It is intended that 0.01 of the 0.05 pence will be devoted to the animal data centre. I believe that it is not expressly mentioned in the order because the Government quite understandably quoted the criteria for the functions rather than specific areas of activity. I hope the noble Earl can confirm that the Government support the work of the ADC and that they fully expect the Milk Development Council to use a proportion of its levy funds to fund the ADC.

Perhaps I may ask why the Government have set out the seven functions of the council but have omitted the eighth function which was suggested by the National Farmers' Union. It concerns human nutritional guidance, issues and crisis management, education, and livestock improvement. The human nutritional guidance work was done by the old National Dairy Council. Do the Government feel that these areas can be sufficiently covered in the seven functions which they have given the council? Is that why they have left out the eighth function suggested by the NFU and the industry bodies?

My next point is important. What will happen if an agent collects money from producers, has the money in his bank for a month, and then goes bankrupt? Is the MDC a preferential creditor in that situation?

I should be glad to have the Minister's confirmation that the development council will have responsibility for pursuing producers who do not pay their levy. In the discussion on previous development council orders setting up the development council, it was suggested that the agents would not be able to pursue the producer because they were acting as agents. At that time it seemed that the development council could not pursue the non-levy payer either. But it seems that in this case the problem has been overcome, which is very welcome.

With those few comments I am glad to confirm the support of this side of the House for the new council.

Earl Howe: My Lords, I am grateful to the noble Lord for his welcome for the order. There is recognition across the industry that the order addresses issues of fundamental importance for the milk sector. Research and development are essential for the future wellbeing of the industry. I am confident that the Milk Development Council will play an important role in that

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area. The Government will also continue to contribute considerably to the funding of R&D in the milk sector—more than £3.6 million for 1995-96 and a similar amount in the following year.

The noble Lord referred to the future of the animal data centre and to the importance of it being fully supported. The broad range of functions listed in Schedule 1 to the draft order would permit the Milk Development Council to engage in activities such as livestock improvement and genetic evaluation work. As I said during the Committee stage of the Agriculture Bill just over two years ago, it would certainly be possible for the Milk Development Council to operate in co-operation with the animal data centre. In the end that would be a matter for the council itself to decide under the terms of the 1947 Act. It is not specifically mentioned but the powers are there.

The noble Lord asked why one of the proposed functions of the MDC had been dropped from the list in Schedule 1 to the draft order. A very early draft of the order listed eight functions in Schedule 1. One of the functions was dropped prior to the draft order being sent out to consultation because it would have permitted the MDC to engage in advertising and promotional activity, functions to which the industry had not previously given its support. I understand that the National Dairy Council would be able to do this if that is what sectors of the industry wished to happen.

The noble Lord asked what would happen if the agent collecting the levy from producers went bankrupt. Matters such as that would be covered by civil law. In such situations it would be unlikely that the MDC would be a preferential creditor.

It is important to repeat my earlier assurance that Ministers will appoint the full complement of six producer representatives so that the producer view is in the majority on the council. I am pleased that the noble Lord has welcomed the order. I commend it to the House.

On Question, Motion agreed to.

World Trade Organisation (Immunities and Privileges) Order 1994

6.57 p.m.

Baroness Chalker of Wallasey rose to move, That the draft order laid before the House on 1st December be approved [2nd Report from the Joint Committee].

The noble Baroness said: My Lords, the Uruguay Round of multilateral trade negotiations which took place within the framework of the General Agreement on Tariffs and Trade between 1986 and 1993 was formally concluded at Marrakesh on 15th April this year. The GATT provides a framework of agreed multilateral rules for world trade and the Uruguay Round marks an important step forward in the liberalisation of such trade. The legal vehicle for bringing the results of the round into force is the agreement establishing the World Trade Organisation—Cm 2571.

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The WTO will provide an institutional structure for the operation of the various trade agreements covered by the agreement establishing the World Trade Organisation. It will provide a framework for the accession of new members, for the settlement of disputes, and for the amendment of various trade agreements and for other decisions and waivers. The secretariat will comprise the director-general and some 400 officials and will be located in Geneva.

Specifically, this debate is about the privileges and immunities accorded under the draft order which need to be conferred in order for Her Majesty's Government to fulfil their obligations under Article VIII of the Agreement Establishing the WTO (Cm 2571). This article provides that the WTO shall be accorded by each of its members such legal capacity and privileges and immunities as are necessary for the exercise of its functions. Privileges and immunities are also to be accorded to officials of the WTO and the representatives of members. In both respects these are to be similar to those provided for in the Convention on the Privileges and Immunities of the Specialised Agencies of the United Nations 1947.

However, as the World Trade Organisation will be located in Geneva, many of the privileges and immunities set out in the draft order in council will never need to be relied upon by the WTO, its officials and representatives of members. The World Trade Organisation is in practice likely only to claim refunds of VAT on goods and services purchased in the United Kingdom for the official purposes of the organisation. We will need only to accord the relevant privileges and immunities to its officials and representatives of members if they attend any WTO meetings or conferences which may be held in the United Kingdom. I would like to emphasise to the House that the privileges and immunities provided for in the order are granted in accordance with the limitations imposed by the International Organisations Act 1968, as amended, under whose provisions the order is made.

The Joint Committee on Statutory Instruments considered this draft instrument and had no comments. I commend the order to the House.

Moved, that the draft order laid before the House on 1st December be approved [2nd Report from the Joint Committee]. —(Baroness Chalker of Wallasey.)

Lord Graham of Edmonton: My Lords, first, let me say directly to the Minister that my noble friend Lord Richard wishes me to convey his apologies because he intended to be here but has been inadvertently drawn somewhere else. If he had been here I am sure that he would have wanted to say immediately that this side of the House and, I believe the whole House, warmly appreciates the manner in which the Minister has explained to us what I believe will be seen in practice as a very significant step towards helping the nations of the world to trade on a more equal basis.

Substantially this legislation replaces GATT and that which flowed from it. We have listened to the function of this House being carried out in order to endorse the legalities which flow from the legislation. If we replace the GATT arrangements which came into operation in

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1948 and which lasted a substantial number of years—that is to say, 47 years—it may be that we are looking here at a provision which will be in existence in the year 2040. That is not something that is easy to contemplate. We know that GATT has been enlarged and changed enormously in the countries which it now covers, including China and Russia and 123 other nations.

We are giving approval tonight to something which is vital to ensure that the world is a better place with all that can flow from trade. I particularly like the desire to ensure greater transparency and consultation in trade policy matters at national, regional and international levels. Surely this country must be a beneficiary in such matters. I especially like the proposals for information sharing under the World Trade Organisation.

I am delighted that the Minister made some reference to the importance of the consumer organisations who have a role to play. I believe that they have assisted in the policy formulation in these matters.

As far as we are concerned, the Government's intention is real as regards the specific arrangements for increasing public awareness and involvement in trade matters. I can well imagine that before the hiatus which occurred between the European Community and particularly America in the past two years, not many people would have understood what GATT was about. The Minister has tonight made it abundantly clear that the international immunities and privileges which will flow from the World Trade Organisation are certainly well understood. We on these Benches give this order a very warm welcome.

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