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Lord Bassam of Brighton: My Lords, before the noble Lord, Lord Kimball, commences his contribution, I rise simply to say that we are now running so far behind the clock as regards the timing of the debate that, if we continue at the same rate with the next group of speakers, the noble Earl, Lord Ferrers, will be prevented from partaking in the proceedings. That, of course, would be a terrible shame for your Lordships' House. Therefore, perhaps I may appeal to the remaining speakers on the list to curtail their speeches for the benefit of the noble Earl, Lord Ferrers.
4.34 p.m.
Lord Kimball: My Lords, it is a great pleasure to follow the noble Baroness, who used to be one of my constituents—hence she developed the taste for good, red meat. We are all most grateful to my noble friend Lord Plumb for initiating the debate.
Many people are reporting on the livestock industry, but I wonder what is actually being done about it. We had the Policy Commission of Sir Donald Curry for a "thriving and sustainable rural economy", which dealt principally with modulation. We also had a policy commission on food and farming, which emphasised the need for farmers to develop their own industry and farmers' markets. Then we had the rural payment agency, the rural development service and the integrated administration and control system, as well as the report by the Rural Task Force under the chairmanship of the noble Lord, Lord Haskins, on the future of our country. However, I believe that the noble Lord was rather misguided in his thinking about organic grazing.
In every area of local administration we currently have a regional director, a rural affairs forum, a regional development agency, a local countryside agency, and blow me down if we do not now have a new concept called the "vital village programme", which has just been introduced. All that is spin, and summed up in one particular document that was sent round to all of us at no charge to anyone, entitled the Essentials of Life, as mentioned by my noble friend Lord Monro. It claims on page 23 that the Government are "rural proofed". But they fail to acknowledge what has had the most profound effect on the English countryside; namely, hunting with hounds. That has had the most amazing effect on the whole way that our countryside is developed.
At present, a period of negotiations is in process. But what is really needed in the future is a statutory backing for the independent hunting authority. A map must be re-drawn so as to remove the hounds, as the noble Lord, Lord Burns, suggested, from areas where they are an irritation. I should like to view the map that is issued every year showing the density of population. I believe that we should withdraw the hounds from areas where the population exceeds 600 persons per square kilometre.
It seems wrong not to realise the contribution that is being made by livery yards, by horse breeding establishments and by hunting. They are all part of the livestock industry, and no subsidy whatever is involved. If you want to think in terms of the Essentials of Life, the livestock industry is what keeps the English countryside alive. It is most encouraging to observe the desire of all stockmen to return to the job that they know best. The Cumberland survey was issued just the other day. A few people in the industry thought that they would like to retire, but, as a whole, most farmers have paid off their overdraft, taken the wife on a holiday, and now want to get back into the business that they know really well.
During the foot and mouth difficulties, 4.4 million sheep were slaughtered. A high proportion of those ewe lambs were kept back from the previous year's lambing—2001—and retained for breeding. I am certain that a similar situation will now apply. However, following the reform of the sheapmeat regulations, DEFRA will make use of the newly-gained independence to reduce the support payments to English sheep farmers. Scotland and Wales are
using their discretion to maintain the payments of the annual sheep premium at £22, but DEFRA is considering reducing the amount to £20. When he responds to the debate, can the Minister clear up that point? We do not need to distort the sheep market; we need to ensure that our small lambs are exported to Spain, and that we recover the market in France for our other lambs.4.39 p.m.
The Countess of Mar: My Lords, in deference to the request made by the noble Lord, Lord Bassam of Brighton, I have taken all the frills out of my speech. The noble Lord, Lord Plumb, has already declared my interests for me; and if I start to talk about goats I know that I shall overrun any time that I may have.
I understand that DEFRA has convened a working group with a membership drawn from the livestock and insurance industries. Its brief is to look at means of insuring the livestock industry against future outbreaks of infectious disease. My attention has been drawn to the fact that cheese makers who produce cheese from the milk of their own animals are in an unusual position, should they be affected by an outbreak of infectious disease such as foot and mouth disease. They stand to lose their animals and their cheese stocks. Can due regard be given to finding an insurance policy that will cover both, not just the animals? The specialist cheese industry in this country has been built up over the past 15 years. It now provides valuable exports, as well as the domestic market, and must be supported.
We have lost the knackers who used to destroy injured animals for us and take their bodies away. We are about to lose the hunts, who used to come to kill animals humanely and incinerate them for us. Because of the SBO regulations, that job has become too expensive. I am concerned on two grounds. On welfare grounds, I am concerned that there is no one to kill the animals. We all know that veterinary euthanasia is extremely expensive, and farmers are not skilled slaughtermen. Sick or injured animals may be left to die in pain, instead of being quickly dispatched. Dead animals may be buried or may be left out for scavenging creatures such as the fox. There is a disease risk in that. The situation is not satisfactory, and I ask the Minister whether DEFRA is addressing the problem.
The noble Lord, Lord Monro of Langholm, said that the Minister apparently told the European Parliament's FMD inquiry that a contiguous cull had been carried out with the approval of the European Union and that its legality had been tested in the courts. If that is correct, can the Minister kindly give the House the exact reference to European approvals, as the relevant directives make no mention of the slaughter of animals not exposed to disease? Will he also tell us which are the relevant court cases?
I fully understand that the Minister was a trifle upset at the result of the Division on the Animal Health Bill. As a hereditary Cross-Bench Peer who does not vote often and has had next to nothing to do with the
hunting debate, I was a little disturbed by the incontinence of the Minister's remarks to the media on the day following the debate about my motives for voting as I did. As a Cross-Bencher, I am not whipped; nor am I Lobby fodder. As noble Lords know, I take my duties in the House seriously. I vote when I have listened to a debate and have been able to make up my mind or when I already have a firm opinion on the subject on which the House wishes to divide. I am sure that my colleagues do likewise.4.42 p.m.
The Earl of Onslow: My Lords, I add my query about what the Minister said to the European Parliament to those raised by the noble Countess, Lady Mar, and the noble Lord, Lord Monro of Langholm.
It is pointless to think that we can learn the lessons for the future of the livestock industry unless we have a proper, deep, full public inquiry into the outbreak of foot and mouth disease. When he is asked about that, the Minister tends to get cross. I get cross, too. I am reminded of what de Gaulle said about Churchill:
- "When I am right, I get cross. Churchill gets cross when he is wrong. We are cross at each other much of the time".
I should have declared my interest. I have a few Dartmoor grey-faced sheep, some Hebridean sheep and some black Berkshire pigs with white feet and black bodies.
In the European Parliament in Strasbourg, the Minister made two claims about the contiguous cull. First, he claimed that the cull was legal and had been tested in the courts. Secondly, he claimed that the policy had been approved by the European Union. I believe that there was only one operative court case, which included a wretched pig called Grunty. Mr Justice Harrison ruled that DEFRA was not entitled to apply a blanket slaughter policy and had to take specific circumstances into account. He ruled that the animals had shown no signs of disease and that it was sufficient that they were monitored and tested. Mr Justice Harrison refused DEFRA leave to appeal and awarded costs of £40,000 against the Government.
Although that case applied to what DEFRA considered to be a dangerous contact, rather than a contiguous cull, the key element of the judgment was that the Minister had no power to order a blanket policy of slaughter and had to take specific circumstances into account. In this context, where Schedule 3 to the Animal Health Act 1981 authorises slaughter "in any case", the wording of the Act seems to support the contention, to the effect that, if the power relates to "any case", a judgment must be made in respect of every case. There would seem to be no power for a blanket contiguous cull policy.
The indications are, therefore, that there has been no legal challenge that supports the Minister's contention that the contiguous cull was legal. I echo the words of the noble Countess, Lady Mar, and ask for details of the cases to which the Minister referred that support his contention and for details of the judgments in those cases.
The operative EU instruments are Council Directive 85/511/EEC, as amended by Directive 90/423/EEC and Council Decision 90/924/EEC on veterinary expenditure—I was briefed on this, by the by. In respect of Directive 85/511/EEC, Article 5 is relevant. It states that,
- "all animals of susceptible species on the"—
- "holding shall be slaughtered"—
- "the competent authority may extend the measures provided for in paragraph 1"—
- "to adjoining holdings should their location, their configuration, or contacts with animals from the holding where the disease has been recorded give reason to suspect possible contamination".
- "foot and mouth disease could have been introduced from other holdings".
- "Without prejudice to the measures to be taken in the context of the common organisation of the market"—
- "(i) the slaughter . . . of animals, (ii) the destruction of milk, (iii) the cleaning . . . of holdings, (iv) the destruction of contaminated feedstuffs . . . (v) losses incurred by farmers as a result of . . . emergency vaccination.
- "(b) where applicable, the transport of carcases to processing plants"—
- "(c) any other measures which are essential for the eradication of the outbreak of the disease".
That reference to "any other measures" could be taken to mean legalisation of a contiguous cull, as it appears to indicate that there is provision for measures additional to those set out specifically in 85/511. However, for such additional measures to be eligible for compensation, the article goes on to state—this is the vital point—that the Commission shall, in accordance with the procedure provided for in Article 41 of 90/424, define their nature. That requires an application to the Standing Veterinary Committee and approval by the Commission by way of a decision. Of the many decisions promulgated by the Commission during the foot and mouth epidemic, all of which have been published, none appears to apply to the UK's contiguous cull policy.
My speech has been detailed and, possibly, I have been more boring than I would normally be. There have been too many slashes. However, I ask when and under what terms did the EU approve the UK's contiguous cull policy? What documents attest to that approval? Can the Minister make those documents available to the House?
4.50 p.m.
Earl Ferrers: My Lords, I should explain to noble Lords that I was expecting to speak in this debate. In order to facilitate that, I called the Government Whips' Office because I thought that that would be the easiest thing to do. Either the inarticulation of the speaker, the difficulty in hearing on the part of the speaker, or the inadequacy of the telephone communication system, resulted in the name of the noble Lord, Lord Fellowes, being put on the speakers' list as opposed to "Earl Ferrers". That was bad luck for the noble Lord, Lord Fellowes.
I declare an interest in that I have been involved with agriculture all my life. It is sad to see agriculture now in total decline and I think that the livestock industry has been hurt more than most. Before BSE in 1996, we were 113 per cent self-sufficient in beef and were great exporters. Now we are only 66 per cent self-sufficient and are major importers. The United Kingdom was the largest sheepmeat producer in the European Union, but in 2000 we were net importers of sheepmeat and this year we are only 80 per cent self-sufficient. That percentage is the lowest for almost 20 years.
Of course, as people eat more, there is a greater demand for meat, in particular beef. Thus we shall become less and less self-sufficient. British people want to eat British beef. They want to eat locally produced food sold at a reasonable price. Furthermore, they want animals to be kept in proper conditions. But what happens is that we import food from all over the world. Bacon comes from Denmark, pork from Romania and chicken from Thailand. Much of that food is produced in conditions that would be totally unacceptable in this country. The result is that the conditions maintained by our producers are put at such a premium that they become less competitive against imported meat.
When imported pork or chicken is cut up in this country, simply because it has been cut here it is then labelled as "British food", which of course it is not. As any schoolboy would say, that is "unfair". It is right for the Government to take action. All this militates against farmers and British agriculture.
I listened to the remarks of the noble Lord, Lord Haskins, with—if I may say so—incredulity. The noble Lord said that farmers ought not to "overstate the case". I do not know how you can overstate the case for going bankrupt. On another occasion he said that farmers ought to "stop grumbling" and be "more competitive". Today he said that they ought to "invest", "raise standards" and "improve efficiency". That is all fine, but how can you invest when you do have not the money to do so? Even if you do find the money to invest, having done so, what is to be done about an inadequate return?
I have told noble Lords on previous occasions that potatoes may cost £150 per tonne, but when they are sold in the supermarkets, they are sold for £8,500 per tonne. That makes one wonder who ought to take on the competitive element. A loaf of bread may cost 50p, but it contains only 3p worth of wheat. The notion that farmers ought to be more competitive and lower their prices further is, I believe, misdirected. The fact is that the supermarkets have a stranglehold on British producers by purchasing from anywhere in the world at the lowest possible prices.
Some five years ago, the price of milk was around 25p per litre. It then fell to 13½p per litre. The price rose again but, as my noble friend Lord Plumb pointed out, it is now falling again to somewhere around 13½p per litre. Those are crippling factors. With the greatest respect, it is no use for the noble Lord, Lord Haskins, to say that people ought to compete. You cannot compete like that; you will go bust. If that is the view of the noble Lord, Lord Haskins, then it worries me that he is actually advising the Government. I suggest to the noble Lord, Lord Whitty, that he should take the advice of his noble friend with great care and that he should take some advice from me as well.
Despite the fact that milk prices can drop to 13½p or 15p per litre, supermarkets now sell six pints of milk for £1.37p. That amazing figure demonstrates quite clearly that British agriculture is going through the most appalling time.
A bereft livestock industry passes on its misery to others. If we have 5 million fewer cows to feed, then less cereals are required for livestock feed. Therefore the arable farmer is hit. Two years ago the price of wheat rose to £75 per tonne, but today it is likely to be around £55 per tonne. According to the noble Lord, Lord Haskins, we ought to be more "competitive". Given those kinds of prices, I do not see how one can be any more competitive.
Some £42 million worth of European funds were made available in April 2001 to take account of alterations in the rates of exchange. The Government never took them. Then £57 million worth were made available in October 2001. Again, the Government never took them.
It is often said that the common agricultural policy ought to be reformed. I quite agree, but the fact is that I do not believe that it will ever be reformed because too many bees are buzzing around the honeycomb. As the European Union grows larger, so more and more people want to pursue what benefits can be had from it.
I recall visiting New Zealand some 17 years ago. Commonwealth preference was being wound down and the New Zealander farmers were in despair because their government were going to remove all farming subsidies. They said that it could not be done. Around eight years ago I happened to return to New Zealand. I sat next to the same person who some years previously had said that subsidies ought to go. He told me that New Zealand agriculture had never been in a better condition. That was because all subsidies had been removed, and thus the bureaucracy and mess that
goes with them went as well. I hope that the noble Lord, Lord Whitty, and the Government will try to do the same rather than simply divert European funds towards bugs and beetles. Rather they should try to put British agriculture back on to a proper footing.4.56 p.m.
Lord Carlile of Berriew: My Lords, I start by declaring an interest as a non-executive director of a medium-sized company which manufactures and sells feed and other products to farmers. Perhaps I should also declare the interest of being a barrister who, over a good many years, has derived enormous professional satisfaction and occasional personal advantage from the litigiousness of farmers, in particular in North Wales.
I congratulate the noble Lord, Lord Plumb, on initiating this debate. The noble Lord and others have reminded us of the scale of the livestock industry. Livestock production remains the major stakeholder in the United Kingdom's agriculture industry and therefore the major stakeholder in the countryside. That remains the case despite the dramatic loss of beef and sheepmeat production which we suffered between 2000 and 2001 as a result of the foot and mouth outbreak.
Unsurprisingly, some noble Lords have spoken of the effects of foot and mouth. In the time available, from these Benches I would simply express the hope that Her Majesty's Government will take the best steps available to guard against any repetition and to enable us to deal with any repetition, if it occurs, far better than last time. In that context, in my view it remains regrettable that, welcome as diverse inquiries from different viewpoints are, there is not to be one comprehensive inquiry—informed by those other inquiries, by academic and by international expertise—to devise an action plan for critical events in the future. It will be inexcusable if, or perhaps when, we suffer another crisis of this kind, but there is no ready action plan available. There must be better ways of tackling outbreaks of foot and mouth disease than those used over the past year or two. As my noble friend Lord Mackie of Benshie pointed out, estimates of the cost of that outbreak have been put as high as £9 billion. Surely we can do better than that.
As was mentioned by my noble friend Lord Geraint, the livestock markets have an important role to play. They have fulfilled an important role in the history of the livestock industry, but they have a future as well. Such markets are major employers and they are the hub of much of the business life of hill-farming communities. Incidentally, they also provide an important point of social contact between often isolated farmers, their spouses and families, who go to market in order to make that social contact. The markets are struggling to source sufficient livestock because of the 20-day standstill rule. I invite the Government to look at this with great care.
Noble Lords, including my noble friend Lord Geraint, have referred to the inconsistent enforcement of control measures by our European Union partners.
Imported carcasses carrying specified risk materials are still being found in the United Kingdom. The noble Baroness, Lady Masham of Ilton, spoke of dangerous imports of other kinds. That is a very important issue. Because we have lost to disease our self-sufficiency in beef and sheepmeat, the risks posed by imports have increased and therefore the vigilance with which we police such imports must be increased.As my noble friend Lord Mackie remarked, the Government must take a firm line over the improvement of inspection procedures and in ensuring that offenders, whether individuals or governments, face real sanctions. Furthermore, I would ask DEFRA to examine the facilities available to port officers. If one visits ports, as I have, one finds that officers often work with completely inadequate office facilities and do not have the space in which to carry out all the inquiries needed. That matter requires attention.
The noble Lords, Lord Haskins and Lord Fyfe, referred to co-operation among farmers. Farmers have co-operated for hundreds of years, and to imply that farmers do not co-operate is not fair. However, there is always room for improvement and there are initiatives for improvement. The industry forum, the findings of which were published in March this year, was an example of co-operation between different parts of the industry and, indeed, DEFRA. It is an example of good practice.
The industry forum identified an obvious, but not always expressed, conclusion, which was described by the noble Baroness, Lady Gibson. To ensure that shoppers buy British meat, it must be butchered and prepared in a way compatible with modern aspirations and lifestyle. Frankly, usually it is not so butchered and presented. The butchery industry has quite a lot to answer for in this regard because of the unattractive way in which it often prepares its produce as compared to imports. One has only to look at the average high street butcher's shop in a small French town and the average high street butcher's shop in a small English town to see the difference in presentation.
Welsh shoppers, for example, want to know where their meat comes from. My noble friend Lord Hooson, who was in his place earlier, is a distinguished and celebrated producer of Welsh black beef, and yet I would not be able to identify his Welsh black beef in a butcher's shop in Montgomeryshire where we both live.
The noble Earl, Lord Ferrers, said that there are issues about labelling—indeed, there are scandals about labelling—which anyone who, like myself, has practised in the trade descriptions area of the law will have seen time and time again. The Government should take steps to ensure that food is labelled in a way which identifies accurately where it comes from—including the country of origin and, if possible, more specifically the source—so that British shoppers can buy and enjoy local produce, preferably well cut.
The noble Lord, Lord Fyfe, referred to Farmcare and pig production. If the CWS, through Farmcare, cannot make economic pig production and sell British pig meat in a profitable way, no one can. Therefore, as
the noble Lord said, there is a great need for a co-operative venture to ensure that there is a strategy for pig meat production. Anyone who has dealt with pig farmers over the years will have seen highs and lows—a kind of manic depressive market—which have never ensured consistency and have guaranteed that pig farmers are the risk takers among the farming community.I turn now to the issue of local killing and local abattoirs. Local killing is attractive to purchasers. Small abattoirs have an important part to play in the supply chain at both ends of the market: for choosy shoppers who, as I said, want to buy local meat; and to deal locally and quickly with casualties. The continuation of small abattoirs could be easily achieved, particularly if, as the noble Lord, Lord Soulsby, said, the veterinary service is available on a proper basis around the country.
The noble Lord, Lord Plumb, rightly referred to the landscape as a part of the picture derived from the livestock industry. He referred to the livestock industry "grooming" the landscape. I would put it in a similar way. Livestock farmers are the gardeners of the landscape—or, at least, their animals are the gardeners of the landscape. If we do not have sheep and cattle on the hills, dereliction will follow. There is nothing more ugly or more derelict than a derelict countryside. It is every bit as derelict as a derelict industrial area, but it is much more obvious to everyone.
That brings me to an old cliché about villages and rural communities. It is a valid cliché and I make no apology for using it. In recent years there have been more farm bankruptcies than ever before. The level of depression and other mental illness among farmers is very high. For example, there is three times the level of suicide among farmers than among doctors, who have every-day access to lethal drugs. It is a very disturbing picture. I applaud the rural stress action plan—the Government have done a lot to help farmers who are depressed, isolated and suffering from mental illness—but, when one has a picture of a very high proportion of suicides and a high proportion of bankruptcies, one has to be concerned about the future of rural communities.
For rural communities, where there is livestock, there is hope. The Government can ensure that there is continuing hope by supporting a strong livestock industry in the future.
5.5 p.m.
Baroness Byford: My Lords, I thank my noble friend Lord Plumb for his excellent and thought-provoking speech which drew the Minister's attention particularly to the question of imported meat, both legal and illegal. I declare a family farming interest. We are pig farmers—although we are getting out of pig farming—and cereal growers.
It is a scandal that a huge amount of illegal meat continues, largely unchecked, to enter this country when the Government have had evidence regularly brought before Parliament, both in debates and Written Questions. The Minister surely cannot say that he is unaware of the problem.
The Government's latest response is the working party announced by Margaret Beckett two weeks ago. A working party is the last thing we need. We need enough inspectors to stop the trade immediately. It would be even better if one person were to take sole charge of the situation. As other noble Lords have said, Clive Lawrence has produced evidence of this illegal trade, but what have the Government done? How many arrests have been made? How much illegal meat has been prevented entering through Heathrow? Do the Government have any idea of how much more is coming in through other ports of entry?
This issue is of vital importance because such trade threatens to bring infection into our country. It is a major concern not only for animal welfare but, as other noble Lords have said, for human welfare too. The Government have totally failed to act. Perhaps the Minister will tell us more today.
Noble Lords have referred to many extremely important issues today. I dare not run over my allotted time, so I hope that your Lordships will forgive me if I do not refer to each point individually. Pedigree breeding, modulation, import controls, labelling, uncertainty over future business, the need for co-operatives, the risk of a recurrence of TB, the use of livestock as an important part of our wonderful biodiverse countryside, the use of fallen stock, which has been taken by the hunts in the past and is of crucial importance to the future—so many topics have been raised by your Lordships. I apologise that I shall be unable to touch on them all.
Let us not forget, nor ignore, that the recent foot and mouth outbreak, about which we have spoken many times in the House, hit hard not only those whose farms were infected and culled out, but also those who were not culled out but who could not move their animals; who could not make sales; who could not have animal pregnancies, and who received no compensation. Much of their subsidiary income disappeared. There was no renting out of their grazing land; no farmhouse bed and breakfast; no local produce sold to bed-and-breakfast businesses; and no contracting. But their costs were still there—their feed costs, their fertiliser costs, their medicines, their inspections, their investments to meet legislation and their Meat and Livestock Commission levies. I forget the saying about a sinking ship—but "the band played on".
As to regulation, I am delighted to see the noble Lord, Lord Haskins, in his place. I thank him for taking part in the debate and for his report on better regulation. I wish that some action had been taken on it already. Some 439 European regulations relating to agriculture were promulgated in 2001—not quite so bad as the 615 in 1997, or the 617 in 1998. There were also some 25 directives in 2001, most of them still requiring legislation in the UK. Is it any wonder that our business is on its knees? As we have heard from other speakers, farming incomes are on the floor. Yet more and more regulations are being piled on to producers.
In UK farming as a whole, income per full-time equivalent person fell from an average of £23,000 in 1996 to £8,492 in 2000. On that basis, each individual suffered a loss in income of over £48,000 over the four years from 1997 to 2000, compared with the figure for 1996. On top of this disastrous situation, the MLC's publication, Key Trends in Meat Consumption, indicates an increase in imports of red meat as a percentage of home production. Home production fell from 50.1 per cent in 1970 to 28.9 per cent in 1990. Other noble Lords have referred to the down-grading of home- produced meat and the increase in imports. That is especially true in relation to pigs and poultry.
That brings me to the problem of processed food. Our farmers are expected to conform to the highest standards. According to Written Answers that I received on 30th June 1999 and 28th March 2002, there was only one—I repeat, one—instance of spinal cord being found in a UK-slaughtered bovine carcass in the past 68 months. Yet UK farmers are still having to pay for special inspections in all abattoirs, with the obvious extra cost to our own producers. At the same time, there have been many cases of imported meat containing spinal material. I raised the matter recently with the Minister.
I want matters to move forward. The Government produced a rural White Paper in November 2000, but no time has been given to debate it, although it was deemed to be an important document. The report on better regulation by the noble Lord, Lord Haskins, has neither been debated nor acted upon. More recently, the Policy Commission on the Future of Farming and Food, chaired by Sir Don Curry, has reported. Its recommendations will require money, time and effective effort. Doing nothing is not an option. The crisis in the countryside is still acute. I wonder whether, while we have been debating the matter this afternoon, any money has been allocated in the Budget to help to implement the recommendations set out in the Curry report.
The Minister will doubtless point to the effort spent by his department in dealing with the foot and mouth outbreak. I accept that demands were made. But if he could arrange for even a small proportion of that effort to be put into stopping disease coming into the country in the first place, we might at least be more confident about the future. The question of confidence was raised by a number of speakers.
A year ago in this House I despaired publicly of the Government. They seemed indifferent to the crisis facing farmers, uncaring as to whether food is produced by UK farmers or whether it is imported. It was not until foot and mouth struck, the countryside closed down and overseas visitors cancelled bookings, that the Government began to understand the link between a healthy farming business and rural business and tourism. The fact that industry was haemorrhaging, with bank borrowings at an all-time high, investment at an all-time low and thousands leaving the industry did not register. No wonder the rural community accuses the Government of a miserable record.
The Curry report gives us hope for the future. It contains a variety of practical ideas. It deals with the question of what we can do. It agrees that some of the requirements need EU and WTO agreement. But, even within that stricture, there are things that the Government can do. Do the Government have the will to tackle regulation? Do they have the will to promote nutritious food and to tackle the long-term problems of obesity which are already affecting the younger generation? Do they have the will to ban food imports from countries which produce food to lower standards than those required of our farmers? I believe that they should do that.
Will the Government recognise that promoting fair trade between producer and supermarket through the food chain centre, as recommended in the Curry report, does not cover catering and processing, and is not, therefore, of direct help to some of our food producers?
Finally, with all these things left undone and with the challenges that lie ahead, is it inappropriate for the Government to answer to a public inquiry abroad, and yet to fail to hold a full public inquiry in this country? Why is it important to do that overseas, when there is a refusal to do it here?
Our farmers are willing to take up the challenge, but they must be given the freedom to do so. They must be enabled to move forward. In relation to co-operatives, I hope that no restrictions will be placed on our farmers in terms of the percentage that they are able produce together, as indeed the Commission prevented in the past.
5.16 p.m.
The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Lord Whitty): My Lords, I thank the noble Lord, Lord Plumb, for initiating the debate and for introducing it in such a wide-ranging and forward-looking way, while at the same time analysing the difficulties sector by sector in a succinct and telling way. Coming to farming, as I do, several decades later than the noble Lord, it is clear to me that although there are some common themes across the sectors—and most sectors have been in serious difficulty over the past few years—there are different problems which need to be addressed somewhat differently.
However, there is, both in the debate and out there, cause for hope and cause to celebrate the prospects for British farming over the medium term. I entirely agree with the noble Lord, Lord Williamson, that we have a competitive advantage in livestock farming which we ought to exploit. I agree with my noble friend Lady Gibson, that the taste, quality and nutritional value of British food—even though, as the noble Lord, Lord Carlile, indicated, it is not always well presented or well marketed—is the best in the world. We ought, therefore, to build on that advantage.
My noble friend Lord Haskins, whose speech I agreed with to a significant degree, usefully divided the debate into the areas of responsibility where the future well-being of the British livestock industry rests: the
CAP, the UK Government, and the industry itself. I shall therefore attempt to organise my remarks in that order. I shall also refer to the issue of disease, which has clearly overshadowed the industry. I refer not only to foot and mouth but to the results of the BSE crisis, which hit the reputation of British livestock farming—a problem from which we have yet to recover.So far as concerns the CAP, the Government strongly support the general thrust of the recommendations of the Curry report. We believe that the present CAP is expensive and that it distorts both farming production methods and farmers' relationship with their customers. We want, therefore, to shift the balance of support for farming, across Europe, away from production-related subsidies and into support which ensures that the farming sector meets the land management, environmental and rural development objectives set out in the report and in the Government's policy.
There are a number of different ways in which that can be done. Some will be longer term; some can be addressed in the mid-term review of the common agricultural policy, on which negotiations are just about to begin; and some are already available to us. One way that is already available is modulation. It was the one issue over which there was a degree of controversy when the Curry report was published. The broad sweep of the report was welcomed, both in farming and in the rest of the food chain. Putting its recommendations into operation may be more difficult. Nevertheless, its initial reception was positive, apart from the issue of modulation.
Modulation is a means which already exists of taking some money away from production subsidies and putting it into broader forms of support. It presents some difficulties. The matters on which the money can be spent are fairly restricted by European law, and there is also the slight difficulty of requiring match funding from Her Majesty's Treasury, and therefore it has to take its place alongside other public expenditure requirements which will not be addressed today but will be addressed in the spending review in the summer, which was always the intention.
Modulation provides us with an existing mechanism whereby we can move in a direction that will be of long-term benefit to the way in which we farm and to British taxpayers, British consumers and the rural environment. It enables us to take some money out of production subsidy and put it into the broader rural development and environmental management of the countryside.
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