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National Farmers Union

Volume 130: debated on Thursday 31 March 1988

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5.

To ask the Minister of Agriculture, Fisheries and Food when he last met the president of the National Farmers Union; and what matters were discussed.

7.

To ask the Minister of Agriculture, Fisheries and Food when he last met representatives of the National Union of Farmers; and what subjects were discussed.

I meet the president of the National Farmers Union and other representatives frequently to discuss matters of agricultural policy. The last occasion that I met the president was Tuesday of this week.

I thank my right hon. Friend for that news. Will he send a message of Easter hope to members of the National Farmers Union in my constituency, who are pig producers, that his success on stabilisers will open the door to the start of successful negotiations on 18 April, to a change in the green pound regime and to a reduction in the MCAs on pigs, which have so damaged the industry? Will he support the Food from Britain initiative, which is trying to open up new markets for British pork meat in the United States, and will he recommend to housewives this Easter that they should buy British pork?

I am sure that housewives will have heard my hon. Friend's last point, even this early in the morning. I support the efforts that Food from Britain is making to try to increase exports of pigmeat products.

As to my hon. Friend's first point, I raised the matter at the Agriculture Council this week, at which we had a preliminary discussion about the price review—the price proposals for this year—and I also discussed the matter with the president of the NFU. I have made it clear in the Council that, because of the increased use of cereal substitutes in the pig rations of some other member states, pigmeat MCAs are now producing, rather than preventing, distortions. I therefore called for an immediate and complete devaluation of our green rate in that sector. This will be a difficult and protracted negotiation because other member states hold a directly contrary view and the Commission has not made a proposal, but I have made my position clear.

When my right hon. Friend met the president of the National Farmers Union, did he make it absolutely clear that when he is in Brussels he is battling not only for Britain but for our farmers, particularly with regard to the green pound and stabilisers? To illustrate the difficulties that my right hon. Friend faced, will he say what line was taken by other member states on price fixing?

Yes, indeed, I did. As to the general line on price fixing, I imagine that my hon. Friend has in mind green rates, which will be an issue in price fixing. There were some calls from member states in that regard, but the Commission made it clear that it was opposed to changes in green rates, apart from the Greek drachma—Greek MCAs are three to four times greater than those in the United Kingdom. I made my position on the green pound clear in the preliminary discussions that we had at the Council this week.

Will the Minister assure our pig producers that their prospects for the next two years will be better than they are at present? Will he tell pig producers and the industry by what percentage he is likely to devalue the green pound in the next six months?

I cannot give the hon. Gentleman an assurance, because we have a lightweight regime in pigs and it depends very much on the market. At present pig production is in surplus, and that market position is obviously affecting the price. In so far as measures are available to me, we argued for, and succeeded in obtaining, private storage aids, which are making some difference to market stability. I have made my position clear on MCAs in the pigmeat sector. The hon. Gentleman will recognise that pigmeat MCAs have fallen nearly 20 points since February last year to the current level of minus 7·5, which has made a big difference to the position. Pigmeat prices have stabilised and some feed costs are still coming down.

I accept that my right hon. Friend is doing all that he can to bring about an immediate 9 per cent. green pound devaluation, but will he give an assurance that the Government are exerting maximum pressure in this direction, and will he say what is the chief stumbling block to the devaluation of the green pound?

This is fundamentally a matter for the price proposals. I made it clear this week that it is necessary to take further steps towards achieving the objective of the complete removal of MCAs by 1992 when the single market comes into operation. We shall be discussing this matter at later Council meetings when we discuss the price proposals. With regard to the main stumbling blocks, there are divided views within the Community, and the Commission has made it clear that it is not making any proposals on this matter.

When the Minister next meets the president of the NFU, will he alert him to the increased incidence of licensed security dealers in the City of London who are investing in agriculture-related stocks, and, in particular, to the operation of Afcor Investments Ltd., which specialises in this sector and whose investments are questionable? Will he also raise the matter with his colleague at the Department of Trade and Industry?

I know nothing of the question, so I shall look into it, but it is not the kind of matter that I normally discuss with the president of the NFU.

Will my right hon. Friend ensure that he does not agree to any devaluation of the green punt without a larger prior devaluation of the green pound, so that British beef producers do not suffer still further from the disparity between the two and a devaluation of the green punt that is not matched by at least an appropriate one of the green pound?

We have not got into detailed discussions on the price proposals yet, so the precise positions of the different member states is not yet clear. My hon. Friend will note that last year we had a devaluation of the green pound in relation to beef that was ahead of the Irish position, and the competitive difference has come down substantially in the past year or two.

Will the Minister accept that, in Scotland at least, farm incomes in real terms are worth only one third of what they were worth 10 years ago? Does he recall that 10 years ago Conservative Members joined Liberal Members to beat the Government and force a revaluation of the green pound? Does the Conservative party accept that the case for devaluation must be prosecuted with as much vigour now as it was 10 years ago?

Farm incomes are under pressure throughout the world because of surpluses. It is because of that problem that we have been devoting so much effort to deal with the surpluses. The position of the green pound is a matter for agreement within the Council. Therefore, we have to get the proposal on the table if we are to get anywhere, and we have to get general discussion among the Twelve. That is where the issue has to be dealt with.