asked the Minister of Agriculture, Fisheries and Food if the European Community has now disposed of wine surpluses in a satisfactory manner.

The European Community disposes of annual surpluses of wine by a variety of means. I believe that the best policy is to reduce the underlying structural surplus, and I am pressing the Commission to honour its commitment to do this.

I am delighted by the Minister's reply, but does he deny that the Community has sold 150 million litres of wine to the Soviet Union at a price equivalent to 5p a bottle? Is that supposed to be disarmament by inducing alcoholic euphoria? Does the Minister deny that it is not in Britain's interests to allow that to occur while the Community is suggesting that British industry, and the British steel industry in particular, should contract on a scale and at a pace far in excess of the industries of our Community partners?

Some methods of disposal are unsatisfactory, as I have said, although the amount that has gone to Russia is only a relatively small proportion of the total exports that have gone outside the Community.

Does my right hon. Friend agree that a more satisfactory method of disposing of the wine surpluses would be to encourage more people in Europe to drink such an excellent beverage?

That would be a good idea.

asked the Minister of Agriculture, Fisheries and Food if he will make a statement on the threat of imported French milk to the United Kingdom dairy industry.

As our public health regulations prevent the sale of any imported pre-packed milk in this country, there is at present no threat to our dairy industry from imports of French milk.

How much French milk is currently getting in and appearing in our markets? What proportion does it represent of total sales? Is that proportion increasing? Can the Minister give a categorical assurance that in no circumstances will our dairy industry be allowed to be threatened by unrestricted imports?

I repeat my answer that, as our public health regulations prevent the sale of any imported prepackaged milk in this country, there is no threat. That milk is banned. If the hon. Gentleman has details of any milk that has come in and has evaded the regulations, I should be pleased to know of them and to make immediate investigations.

Will my right hon. Friend bear in mind that there is no need for British schoolchildren to drink French milk? There are totally adequate supplies to meet that need. Will the Minister tell us roughly what finance we could obtain from the Community to support the cost of our school milk?

Milk for schools is produced by our industry. Later this afternoon I shall announce details of the agreement on school milk. It will mean that the amount of milk available to schools in a full year will be doubled or trebled. It will be the greatest quantity of milk available to schools for the last 10 years. If there is a good response, it could mean an extra £20 million available to this country from Community funds.

Is the right hon. Gentleman aware that, during his chairmanship of the Council of Agriculture Ministers in the next six months, the Commission will be considering a request from the French to make a reference to the European Court so that they can invade our market with UHT milk? If, therefore, there is a decision by the European Court in favour of the French, is the right hon. Gentleman prepared to defy that ruling?

It is extraordinary to ask a Minister to say, prior to a court decision, whether he will defy the law if that decision goes against him. We believe that our case with the European Court is justified and that we shall win it.

Further to the matter raised by the right hon. Member for Barnsley (Mr. Mason), is it not the case that if the right hon. Member for Deptford (Mr. Silkin) had not sold the pass by agreeing to the import of UHT cream, the matter would have been substantially simpler now?

If I had to list all the difficulties that we have had as a result of past experiences and negotiations with the European Community, it would take a great deal of the time of the House.

Is the right hon. Gentleman aware that there is a real fear in our dairy industry, particularly on the distributive side, that we shall lose the case at the European Court and that therefore French milk will come in? Is the right hon. Gentleman aware, further, of the tremendous feeling among consumers that our doorstep deliveries should be maintained? Therefore, whether we lose the case at the European Court or not, will the right hon. Gentleman consider standing up to the French and keeping out their milk?

The hon. Gentleman's comments show a remarkably defensive attitude which implies that the French can produce better milk at a better price than our dairy industry. I do not accept that for one moment. Anyone who has known the horror of drinking milk in France knows that it is untrue.

asked the Minister of Agriculture, Fisheries and Food whether he is now in a position to announce action to deal with French poultry imports.

asked the Minister of Agriculture, Fisheries and Food what estimate he has made of the cutback which has taken place in the British poultry industry in the last year; and if he will announce a programme of measures to reverse its decline.

asked the Minister of Agriculture, Fisheries and Food what progress has been made in dealing with the problem of the import of cheaply produced turkeys.

asked the Minister of Agriculture, Fisheries and Food whether he is now in a position to announce further measures to assist the British poultry industry to overcome its financial difficulties.

asked the Minister of Agriculture, Fisheries and Food whether he is satisfied that fair competition now exists in the European Economic Community with regard to poultry products.

asked the Minister of Agriculture, Fisheries and Food what further progress he has made in his discussions towards protecting the British turkey industry against unfair competition from French producers in the British and other European Economic Community markets.

asked the Minister of Agriculture, Fisheries and Food what discussions he has had recently with the European Commission concerning the poultry meat industry.

My right hon. Friend and I have requested the European Commission to take effective action on State aids that distort competition. We have already given £2 million in aid to assist our industry with hygiene inspection, and we are discussing with representatives of the industry possible changes in these arrangements.

rose—

Order. I propose to call first those hon. Members whose questions are being answered.

Is my right hon. Friend aware that there is no time for leisurely bureaucratic EEC minuets on this issue, and that if the French were in our position they would not care two hoots about the niceties of the matter? Will he please take action now?

As I said, we have already taken action relating to this matter, which I raised specifically in the Council of Ministers on Tuesday of this week. The Commissioner said that he was due to receive a reply from France and that unless the French Government replied within the allotted time he would take action immediately.

Is the Minister of State aware that that is a most complacent reply? It is no use harking back to the £2 million paid towards the inspection service. Thousands of jobs have been lost in the poultry industry, which is one of the most efficient sectors of British agriculture. When will the Government take effective action to save this industry from total collapse?

What the hon. Gentleman says is hypocritical and without understanding of what has already been done. If he regrets the £2 million having been given to the industry and the steps now being taken in consultation with the industry to improve hygiene inspection arrangements, he simply does not begin to understand the industry's problems. We do, and we are not in the least complacent about them.

Does my right hon. Friend appreciate that the number of questions on the Order Paper on this issue shows the seriousness of the situation? Does he also appreciate that many of us realise that panic measures and the statement that we have just heard do not lead to confidence in the industry to build up supplies? Can he tell the industry that what the Opposition are saying is nonsense?

I am grateful to my hon. Friend. We certainly understand the position in the industry, and my right hon. Friend and I have had several meetings with representatives from the industry to discuss what we are doing. Moreover, the reply given by my hon. Friend the Parliamentary Secretary in a debate earlier this week shows the action that we are taking.

I welcome warmly the financial aid that has been given to the industry and the steps taken by the Government to try to ensure fair competition for it. Will my right hon. Friend agree, however, that the poultry industry is still facing a desperate crisis and that, as my hon. Friend the Member for Melton (Mr. Latham) said, the French do not hesitate to take steps, at the drop of a hat, to help their industry? Will my right hon. Friend indicate the other areas of agriculture to which the French are giving some form of assistance, quite illegally and outside the regulations of the European Economic Community?

As my hon. Friend heard me say, we have already taken action to help our industry in several ways. I assure him that there is no way in which we shall see our industry destroyed by the French or any other country's industry.

On the narrow point of turkeys, can the Minister offer any hope to our domestic industry, which has suffered enormously from heavily subsidised French production? Unless our industry receives help similar to that available to the French, it will decline very rapidly.

I have no doubt that the British turkey industry sets an example in efficiency, modernisation and innovation to other industries, not only in Europe but elsewhere in the world. I am very conscious of that and we do not want to see that go by default.

Will not the massive expansion in turkey meat production in France, the proposed massive expansion of broiler meat production for Third country consumption and the approved programme announced in the Official Journal of the European Parliament on 17 July lead to a massive capability for over-production of poultry meat within the Community? That must affect not only the United Kingdom market but the market of France and the other countries within the Community. Does not that leave ground for valuable bilateral talks to discuss how the problem could be tackled?

As I said in a previous answer to the hon. Member for Norfolk, North-West (Mr. Brocklebank-Fowler), this is not simply a problem for Britain and France; it goes far wider. It is interesting that there is even anxiety in certain established sectors of the French poultry industry about the effects upon them of encouragement to expand. I must also reiterate that both this week and on previous occasions in the Council of Ministers the United Kingdom was not alone. Many of our colleagues are pressing equally hard for action about State aids.

As the French are now imposing a levy on British lamb imported into France, why should we not impose a levy on French poultry and French milk imports here?

Not unusually, the right hon. Gentleman is wrong. The French are not imposing a levy on British lamb

Is my right hon. Friend aware that this problem arises partly from the fact that the French are using industrial grants under their regional policy to assist the agriculture industry? Will he take into account the fact that on several occasions over the past few months assurances have been given from the Government Front Bench that he and his colleagues did not intend to see our poultry and turkey meat industries destroyed, and that the point has now been reached where action, rather than assurances, is expected?

We are certainly not prepared to see our poultry industry destroyed. My hon. Friend is correct in saying that some of the aids are of a regional nature. Equally, however, some of the aids that the French Government are giving are direct production aids such as the Commission has already pointed out are incompatible with the Treaty. It is in relation to them that action is being taken.

Despite the Minister's tough talk—even, recently, from a soapbox—and despite the reference to the Community, is it not clear that the French will remain determined to continue for substantial periods each year in the future, as during each year in the last decade, to sell eggs in northern markets in England at prices below the cost of production in France? Since the French will clearly disregard anything the Community may say to them, is it not time for action?

The hon. Gentleman is not totally correct. For example, we have regularly exported eggs to France. The hon. Gentleman says that the French are determined to try to expand their industry, and it is clear that they are prepared to do so. Equally, we are prepared to stand by our industry, too.

Has my right hon. Friend seen reports this morning that the French have imposed a ban on the importation of certain agricultural products in the face of falling home prices for their farmers? If he has not seen that report, will he study it and consider whether we should not take certain action in the same arbitrary way?

I have heard about the report only in general terms. I assure my hon. Friend that we shall investigate it urgently.

In order to make clear the seriousness of the decline of the poultry industry, will the Minister tell the House how many jobs have been lost in the industry during the past 12 months?

If the right hon. Gentleman tables a question on that matter, it will be answered. I acknowledge—neither I nor anyone on the Government Front Bench has made any secret of the fact, in any recent discussions on the poultry industry—that our poultry industry, particularly the turkey meat and broiler sectors, is facing a serious situation. It is precisely in relation to that that we are determined to defend the industry.

Do I understand aright? Has the right hon. Gentleman come to the Dispatch Box, having had a week's notice of the six questions that appear on the Order Paper dealing with the future of the poultry industry and the serious situation facing that industry, only to tell the House that although the industry is in, a serious state he does not have in his brief the number of jobs that have been lost in the past 12 months? Why is the right hon. Gentleman a Minister? Why does he not seek a brief? Should he not know how serous the situation is?

As the right hon. Gentleman. would know if he were seriously interested in the poultry industry, jobs are not the only important issue. The question goes far wider, involving, as has been recognised in all the questions asked from the Government Benches, not only jobs but important British trade and business and the need to ensure fair competition. On all those issues we will stand up for the British industry, even though the right hon. Gentleman may not.

asked the Minister of Agriculture, Fisheries and Food if he is satisfied with the efficiency of the United Kingdom intervention board for agricultural produce.

Obviously I cannot be satisfied with the efficiency of an intervention board where industrial action is taking place. But, with the exception of the adverse effects of the industrial action, I am satisfied with the efficiency of the intervention board.

Is the Minister aware that last year the intervention board spent £500 million of taxpayers' money on dubious purposes of various kinds? For example, £42 million was spent on feeding surplus milk powder to animals. In particular, is he aware that £145 million was spent on exporting surplus British grain and dairy products to countries outside the EEC? As Britain is a net importer of both grain and dairy products, how can that be efficient?

If the hon. Gentleman studied agriculture rather more closely, he would discover that there were a number of varieties of grain, some of which we need to import and some of which we need to export.

Can my right hon. Friend give some assurance that the intervention board's attitude to the British apple industry will be more sound in the coming year?

I can undertake that it will be as sound as it possibly can be.

Will my right hon. Friend take steps to change the standards for intervention, so that we do not take all the best products into intervention and leave the rather inferior ones for the consumer?

Intervention policy varies from one product to another. With regard to the whole intervention policy of Europe, we have been trying to stop, for example, the intervention of good meat which then deteriorates in intervention. We consider that to be an absurdity. We will always review such matters with that objective in mind.

asked the Minister of Agriculture, Fisheries and Food what recent discussions have been held on uniformity of aid to horticulturists in the European Economic Community.

Although there are no specific limits for national aids to horticulturists, it is certainly my intention to raise the subject of national aids, and the threat which they pose to the whole basis of the common agricultural policy, with my colleagues during the United Kingdom Presidency. At the meeting that took place in Brussels this week, we obtained the agreement of the Commission to present this autumn a major paper studying the whole impact and effects of national aids.

I thank my right hon. Friend for that reply. Does he agree that the Dutch horticulture industry appears to be using the slowness of Community machinery deliberately to destroy its competitors in this country? Will he please give this matter the utmost priority?

Yes, Sir. This specific matter was raised by my right hon. Friend the Minister of State at the meeting in Brussels last Monday. The Dutch Government, although they have increased the gas price, have been summoned by the Commission and told clearly that the progress in establishing a proper basis for their gas price is not satisfactory, and that is being reviewed.

Is it now dawning upon the Government that uniformity of national aids is in reality an unattainable objective within the EEC and that we would be better occupied in regaining our own national freedom of action?

No, Sir. The availability of the European market to our food and agriculture producers is a great advantage. If the right hon. Gentleman studied the considerable expansion of our food exports to the Community, he would realise what an advantage it was.

Is the Secretary of State aware that all that our horticultural growers, particularly tomato producers, are seeking is a fair share of the home market? The fact is that Dutch imports of tomatoes continue to grow, backed up by cheap fuel—even if the price is slightly increasing—and cheap credit. That cannot continue if our growers are to remain in business.

Yes, and that is why we introduced a package of special aid for our horticulture and why we have made a major aspect of the United Kingdom Presidency in this six months a study of the possibility of uniformity in the whole question of national aids; that affects horticulture more than most industries.

Is my right hon. Friend aware that my Lea Valley constituents recognise that he is doing his best but that his best is far too slow, because of the Community structure? Is he also aware that, so incensed and distressed are they, they are talking about trying to organise a boycott of Dutch imports?

Until last week, the price of one of the major commodities, tomatoes, was substantially above last year's prices for a few weeks. A considerable volume of British tomatoes was sold in that period. But because of our close relationship with the horticultural committee of the NFU, it knows that we have given every possible aid and that if we are successful in our pressure to obtain uniformity of aids during our Presidency it will be the best help that we can give our horticulturists.

Will the Minister at least accept that the strength of feeling among our horticulturists is considerable, and that they do not believe him when he says that he has done as much as possible? They believe that it is too little and far too late, and that there is a lack of effort.

If they believe that, what they must think of the previous Government I dread to think. I inherited a Dutch advantage much greater than it is today, with no aids given to the industry.

asked the Minister of Agriculture, Fisheries and Food what representations he has received in connection with the financial difficulties experienced by farmers as a result of delays in value added tax repayment.

I have received representations on this subject from the National Farmers Union, the United Kingdom Agricultural Supply Trades Association, several hon. Members and a number of individual farmers.

In the event of the Civil Service unions accepting the Government's latest offer, will my right hon. Friend do all that he can to ensure that the VAT office swiftly refunds the £150 million owed to British agriculture? Does he acknowledge that enormous hardship is being heaped upon British agriculture by the unofficial strike action, having particular regard to the fact that some farmers and growers are unable to offset PAYE and schedule D payments against VAT?

I am well aware that that has caused considerable difficulties, especially for some of our smaller farmers. Although the VAT office is not my departmental responsibility, I know that if the strike is settled my right hon. and learned Friend the Chancellor of the Exchequer, in regard to VAT repayments, and my Department, in regard to capital grants and other payments to farmers, will take every action to get the money to the farmers as quickly as possible.

asked the Minister of Agriculture, Fisheries and Food what are the current rates of levy per pound on imported beef, butter and cheese.

The current rate of levy, including the MCA, on imports into the United Kingdom of beef ranges from 11p to 74p per pound. For butter it is 50p per pound, and for Cheddar cheese 56·5p per pound. But, as my hon. Friend knows, all the cheese and almost all the beef and butter imported into the Community comes in under preferential arrangements at substantially reduced, or nil, rates of levy.

In view of its renowned efficiency, does British agriculture need this massive and grotesque level of protection against foreign competition from the Third world?

My hon. Friend must have failed to listen to my answer, and, if so, I hope that he will read it tomorrow, because I pointed out to him that all the cheese and almost all the beef and butter imported into the Community comes in under preferential arrangements.

Does the right hon. Gentleman regard this system of food taxes as one of the benefits to the United Kingdom of EEC membership?

I should like to put back the question to the right hon. Gentleman. [HON. MEMBERS: "Oh."] What system would he recommend under which he would hope to ensure a fair deal and security of good supplies to the consumers of this country which at the same time would maintain a healthy agriculture industry? I believe that the present arrangements do that.

Do the Government support the first proposal made by the Commission for the reform of the common agricultural policy, which is that Community food prices shall, over a period of years, fall to world prices?

That precise proposal is not made, but, as my hon. Friend will know, in all the price fixing with which my right hon. Friend and I have been concerned we have endeavoured to exercise restraint on price increases.

Do these levies ensure that British food prices are the highest in Europe?

No, and, as the hon. Gentleman knows, we also obtain from Europe a number of other measures—for example, in the beef premium scheme, in the lamb premium scheme and in relation to the butter subsidy—whereby prices in the United Kingdom are helped out of Community funds.

asked the Minister of Agriculture, Fisheries and Food when he expects the Council of Agriculture Ministers to be considering proposals for the fundamental reform of the common agricultural policy.

The Council is likely to be discussing the recommended guidelines for the common agricultural policy contained in the Commission's recent report on the 30 May 1980 mandate at its meeting in October.

Did my right hon. Friend read the speech made by my right hon. and learned Friend the Chancellor of the Exchequer recently, when he advocated reform of the common agricultural policy based upon a greater play of market forces both in Europe and internationally, reduced levels of real support and tougher financial disciplines comparable to those exercised on other public spending? Does my right hon. Friend agree with that fundamental approach to reform?

Of course I read with interest every speech that my right hon. and learned Friend the Chancellor makes. In terms of the common agricultural policy, my right hon. and learned Friend and I have worked together on these matters over the past two and a half years, and we appreciate that the rate of growth of CAP expenditure is now around half what it was under the previous Administration and, as a proportion of the budget, has fallen substantially.

Will the Minister accept that the common agricultural policy would work even better if we had some of the patriotic and bloody-minded customs officers that they have in France, Germany and Italy?

I could not in any way criticise the excellent customs officers that we have in this country.

Will the right hon. Gentleman take note that the British glasshouse growers feel a deep sense of betrayal and cannot wait for this reform to take place, because they have to compete against Dutch growers who are enjoying an advantage of between £7,000 and £10,000 an acre? Will he note that hundreds of Lea valley growers met last night at Broxbourne and demanded that the Minister should introduce a tariff immediately to give them an opportunity for fair competition? When small business men are up in arms about this, is it not time that this Government, who said that they were going to do something about small business men, got moving?

Yes. That is why this Government, unlike the previous Government, gave a grant to our glasshouse growers and that is why we succeeded in enforcing on the Dutch a substantial increase in their gas price. If the hon. Gentleman is complaining now, that is nothing like the complaints that he should have had during the period in which his own Government were in office.

In view of what my right hon. Friend said a few moments ago, is it now his considered opinion that in the foreseeable future there will be a uniformity of national aids throughout the Common Market?

When one uses the word "uniformity", one must bear in mind that we have in this country, for example, the substantial ADAS advisory services that other countries do not have; we have a system of capital grants that other countries do not have. Therefore, I do not accept direct conformity on every detail. However, all our national aids are approved by the Commission. What I object to is one particular country—France—putting in £400 million to £500 million of national aids that are not approved by the Commission.

In view of the impending disaster in the poultry and horticulture industries in this country, largely due to the question of national aids which is being discussed this afternoon, will the Minister ensure that action is taken very quickly in the reform of the common agricultural policy to see that national aids benefit Britain as well as France and other countries? If not, will he take some unilateral action about national aids?

Yes. That is why, at the first Council meeting of the British Presidency, we obtained the agreement of the Commission that during the period of the British Presidency the Commission would have to present to the Council of Ministers a full and detailed paper on national aids. That is why my right hon. Friend the Minister of State obtained an assurance that within days, because of the failure of the French Government to comply with European requirements on national aids, the Commission would be taking action.

asked the Minister of Agriculture, Fisheries and Food what response he has had to his consultation letter proposing changes to the agricultural land grading system.

We have so far received 44 replies to the 60 consultation letters that were sent out. The replies are being analysed now and I shall be considering them without delay.

I am grateful to my hon. Friend for that reply. Does he agree that the slightly overkill reaction of the NFU to these modest and sensible proposals is rather depressing? Does he agree that his modest proposals will put beyond doubt the fact that grade 3 agricultural land is not third-class land, and will he pursue this matter and perhaps receive other representations from other members of the NFU?

Dealing with the latter part of my hon. Friend's question, I shall have to weigh up differentially the various advice that I have been given, but the whole idea of this proposal was to support the view that he has put forward. I would rather not get involved at this stage in commenting on individual attitudes, although naturally I was a little surprised by that of the National Farmers Union.

Will the Minister accept that the minimum of 1,000 acres for so-called island sites for marginal land—[HON. MEMBERS: "Reading."]—on the contrary, I know this subject backwards—could cause considerable hardship, especially where these sites are under 1,000 acres, mainly because of compulsory purchase? Will he therefore consider some discretion in this limit?

This does not truly have any relation to the question that was asked. However, I am considering the question of island sites, although not necessarily in quite the way that my hon. Friend would like.

asked the Minister of Agriculture, Fisheries and Food if he will make a statement on his policy on the setting up of a central co-ordinating council for agricultural marketing.

I am convinced that it is in the United Kingdom's interest that the marketing of food and agricultural produce should be better co-ordinated and I am actively considering how this might best be achieved.

I welcome my right hon. Friend's encouragement to agricultural marketing. I hope that very soon he will be able to approve the setting up of this council. I also welcome my right hon. Friend—

Order. We know what the hon. Member welcomes. We want his question.

Will my right hon. Friend ensure that this body has enough teeth and encouragement from theGovernment so that we can sell milk to France, bacon to Denmark and bulbs to Holland, which we are already doing?

We shall endeavour to increase the volume of these splendid exports that are at present taking place, but we are having talks not just with the representatives of the producers but, which is very important, with our processors, manufacturers and retailers so that our objective will certainly be to have an effective body which can both substantially improve our penetration of overseas markets and obtain a bigger share of our domestic market.

Are there fewer or more councils, commissions and committees sponsored or financed by the Minister's Department now than there were in May 1979?

All of them are doing a fine job of work.

asked the Minister of Agriculture, Fisheries and Food if he has received further representations on the present system of arbitration of farm rents between tenants and landlords.

No, Sir, but a proposal for a revised rent formula has been submitted to me by the presidents of the Country Landowners Association and the National Farmers Union.

I thank my hon. Friend for that reply. Is he satisfied that the present system of arbitration is completely independent, since the arbitrator may be involved with one of the parties? Will he consider a system with an independent chairman—perhaps involving a panel—to ensure true independence?

The arbitrator may be chosen by agreement between the parties. Failing that, my Department may be asked by either party to make an appointment from the Lord Chancellor's panel of arbitrators. That frequently happens.

Will the hon. Gentleman carefully study these proposals, which seem to have considerable merit, from both the CLA and the NFU, allied to the suggestion by his hon. Friend that the appointment of an arbitrator would make honourable, legal and decent what is infrequent practice in reality?

I must rebut that accusation. The appointment of arbitrators is not a matter of dispute between the parties. The machinery is well established and well organised. My right hon. Friend is meeting both presidents this afternoon to discuss the proposals put forward by the two organisations.

Does the Minister accept that it would be wrong for an arbitrator to continue with an arbitration if he were connected with either of the parties? Any arbitrator worth his salt would certainly withdraw from the scene.

Arbitrators in these matters are appointed either by agreement between the parties or from the Lord Chancellor's panel, from which my Department selects names. There is no difficulty about this matter, but if the hon. Gentleman knows of a specific case I shall be glad to look into it.

asked the Minister of Agriculture, Fisheries and Food how much was spent by the United Kingdom intervention board in 1980; and how much of this was represented by subsidies for exports to countries outside the European Economic Community.

Net of receipts from levies and sales of intervention stocks totalling £116·8 million, the figure is £645·7 million, of which £198·7 million relates to refunds on exports to non-member countries.

Has the Minister taken the trouble to find out how much of this subsidy from the British taxpayer is going to the Soviet Union?

In 1980 the board made some modest refund payments on chicken and malt exported to Russia, together with negligible amounts on some other commodities.

Is my right hon. Friend aware that if it were argued that it would be cheaper to support British agriculture by deficiency payments, according to calculations made by the Labour Party, and on the most likely set of assumptions, the total cost would be £1·7 billion a year?

I have not studied in detail the Labour Party's proposal on this issue, but normally its estimates on such matters are modest.

Is the Secretary of State aware that my constituents in Newcastle upon Tyne. West would not mind having to pay higher prices for food if they resulted in aid to underdeveloped countries, but that they bitterly resent having to pay these higher prices when they result in subsidising food which goes to the USSR?

That is why Her Majesty's Government have opposed subsidised food going to the Soviet Union. Certainly, the Community has supported food aid programmes. One of the most important exports of subsidised food has been to Poland, which, on balance, I think most hon. Members would consider to be correct.

asked the Minister of Agriculture, Fisheries and Food if he will consider further assistance for the hill farming sector.

The rates of hill livestock compensatory allowances will be reviewed in the autumn in consultation with the farmers' unions.

Does my right hon. Friend accept that, although the hill farming sector greatly appreciates the substantial help brought to it in recent years, the problems remain acute and the hill farming sector relies on substantial help in the forthcoming review?

I assure my hon. Friend that all matters affecting the economics of hill farming will be taken into account during the review of hill livestock compensatory allowances.

asked the Prime Minister if she will list her official engagements for Thursday 23 July.

This morning I took part in the presentation of the Humble Address to Her Majesty the Queen on the occasion of the marriage of His Royal Highness the Prince of Wales. Later, I presided at a meeting of the Cabinet, and, in addition to my duties in the House, I shall be having further meetings later today. This evening, I hope to have an audience of Her Majesty.

When the Prime Minister speaks to Tory Members of Parliament tonight, will she repeat the famous nursing advice that she gave some time ago on television about how to get the economic patient back on its feet in a few days? Is not two years in the Tory intensive care unit dragging things out a bit? Is not the problem that the Prime Minister and her Government are cutting off the oxygen supply? If the Tory medicine is really working, why is the patient so weak?

Has the hon. Gentleman forgotten that after two years' of Labour Government the country was on the way to the IMF?

Might I suggest that today the Prime Minister may be able to spare some time to assist the Leader of the Opposition in making a date with the leaders of the Socialist Parties in France and Germany to hear their views on the need for the defence of Western Europe?

I gladly advise the Leader of the Opposition to do that. One of the most outstanding features of the Ottawa summit was the fierce, robust attitude that Mr. Mitterrand took to the defence of France and his duties to the Alliance, in both conventional and nuclear weapons. That attitude was also adopted by the Chancellor of the Federal Republic of Germany. It is utterly different from the attitude of the Socialist Party in this country, which runs away from its fundamental duty of defending the country.

Is the right hon. Lady aware that I had a most agreeable meeting with representatives of all the Socialist Parties in Western Europe a week ago and that they all agreed to the proposition that we should urge most strongly that negotiations with the Soviet Union should take place as soon as possible? Is she also aware that they urged that we go ahead with negotiated reductions? Why was the right hon. Lady so backward in Ottawa in supporting Mr. Helmut Schmidt in those proposals?

The right hon. Gentleman was not at Ottawa. He will see from the communiqué that we agreed that we should try to negotiate down our armaments in a balanced, monitored and verifiable way. The right hon. Gentleman has already given up his negotiating position. Why on earth should anyone negotiate with his party? It has already given up everything while the Soviet Union keeps all its armaments and nuclear weapons.

Will the right hon. Lady care, for a change, to answer the question? Will she tell the House that she now agrees with what Helmut Schmidt said at Ottawa? I read the report of what he said. He urged that negotiations should take place as soon as possible. Does the right hon. Lady agree with that demand, and did she lend her support to it?

Has the right hon. Gentleman not read the communiqué agreed by all the nations that, of course, we will negotiate? The difference between the right hon. Gentleman and the Government is that we believe in negotiating from a position of strength, as did all Heads of Government present at Ottawa. The right hon. Gentleman believes in trying to negotiate from a position of total weakness.

Does my right hon. Friend recall that, after twenty-eigth months in office, the Labour Government—like the previous Conservative Administration—introduced an incomes policy contrary to their election pledges? Does she accept that, as she enters into the twenty-eighth month of the life of her Government, she commands the widespread support of employers, trade unions and the majority of Labour Members for her policies to contain inflation without introducing an incomes policy?

I believe that one of our most important achievements has been a great increase in the competitiveness of British industry and the fact that we are still exporting some 33 per cent. of our GDP. That could be done only by getting down pay settlements and keeping them more closely in line with productivity—and I hope that we shall continue along that path. Incomes policies introduce unwarrantable rigidities, which cause all kinds of problems as workers in many industries seek to unwind them.

What is the use of having more competitive British industry if that is happening at a time when our gross national product has been going down, when those of other leading industrial countries have been going up and when our unemployment record is worse than that of any of our competitors? What is the point?

I doubt very much whether the hon. Gentleman has observed that the nations whose industries are most competitive are those with the lowest inflation and least unemployment. Those two nations are Japan and Germany.

asked the Prime Minister if she will list her official engagements for 23 July.

I refer my hon. Friend to the reply that I gave some moments ago.

Does my right hon. Friend appreciate that she will have the support of the vast majority in the House and the country if she takes this opportunity to repudiate the statement by the leader of the Greater London Council accusing Britain of pursuing policies of murder and intimidation against the Roman Catholics in Northern Ireland?

I saw reports of a statement to that effect. If they are true, I think it the most disgraceful statement that I have ever read. It is a totally unwarranted slur on our security forces, both the police and the Army, who are there to protect all the citizens of Northern Ireland and who carry out their duty with total impartiality. I should like to make it clear that the vast majority of us in the House are on the side of the law-abiding and not on the side of convicted criminals.

Reverting to the right hon. Lady's reply about incomes policy, does she maintain that the nation must keep taking the medicine, even though the offer of 6 per cent. to nurses—when inflation is running at 12 per cent.—must mean a substantial reduction in their standard of living?

In the end, each of us in the public sector depends on the earnings of the private sector for our prosperity. The private sector will depend ultimately on whether it can produce goods and services competitively—and which people in this country and overseas will buy. There is absolutely no way out of that fundamental problem except by producing the relevant goods and services.

Will my right hon. Friend find time today to study the recent estimate by the Inland Revenue of the amount of money lost to the Exchequer by moonlighting? Can she tell the House whether she proposes to take any further steps about that, and whether the figures indicate that more people have jobs than the current employment statistics show?

That is indeed a problem in this country and a number of others where there appears to be a thriving cash economy. The Inland Revenue tries to use its staff to catch up with unpaid taxation. Undoubtedly, we should have greatly increased revenue, which would be very welcome, if we were able to discover all those not paying tax properly.

asked the Prime Minister whether she will list her official engagements for 23 July.

I refer the hon. Gentleman to the reply which I gave some moments ago.

Bearing in mind the Prime Minister's concern for handicapped people, may I ask whether she will take a personal and caring look at the Manpower Services Commission's recommendations to amend the job quota for the disabled? Will she accept that a code of practice is not good enough and that this is of great concern to the voluntary support organisations?

I saw the proposals for change, but I believe that they would be very controversial and that a number of people think that the present arrangements are better than any proposed change.

Is my right hon. Friend aware that British information services in the United States of America appear to be seriously under-staffed in both numbers and journalistic quality? Unless that is corrected, the chances of our winning the propaganda contest in that country over Northern Ireland are remote.

I doubt very much whether the British Embassy in Washington is under-staffed. It has a difficult task in trying daily to put over the true state of affairs in Northern Ireland. We are anxious that not only the embassy but all Ministers and hon. Members of this House who visit the United States should take time to put over on television and radio the position of the United Kingdom with regard to Northern Ireland. We are there because the vast majority of the people of Northern Ireland wish to stay citizens of the United Kingdom. We are there to defend all law-abiding citizens in Northern Ireland, and we carry out those duties faithfully and impartially.

Will the right hon. Lady please reflect on what she said about the competitiveness of British industry? Will she take the opportunity at some time to meet representatives from all sections of the clothing and textile industrial, to talk with them and learn from them that close to 2,000 jobs are disappearing each month because of the inability to compete with unfair competition from abroad?

The hon. Gentleman will know that we have protection for the textile industry. The multi-fibre arrangement is in process of renegotiation. He will also be aware that the import of textiles is one of our problems because textiles are among the products frequently made by developing countries and exported to this country. We must also watch the imports from other countries which have lower-priced petroleum products than we do, because they go through into the synthetic materials. However, that position is very much better since the exchange rate was altered.

My right hon. Friend has repeatedly and rightly stressed the need to create real productive jobs. Will she, therefore, take this opportunity to launch an initiative in conjunction with the TUC and the CBI to promote a major campaign designed to purchase British goods throughout British industry and to bring home to the British people the need to buy British goods in order to sustain British workers?

If more of our people bought more of the produce of our industries, there would be more employment in the country. However, they are likely to do so only if those goods are of the best possible value. The British housewife and wage earner are very shrewd buyers, and they will rightly continue to buy the goods which give the best value.

Will the Prime Minister give an undertaking that, although the Secretary of State for the Environment is in Liverpool with a closed cheque book, the right hon. Gentleman's mind is open enough clearly to say that, although the Government will not give more money to the local authorities of Merseyside, they will not take any more money from them in this financial year in the way in which the Government have taken money this week from the Scottish local authorities?

My right hon. Friend the Secretary of State for the Environment is having an interesting time in Merseyside and, of course, he is discovering all the facts and taking a good deal of time to talk to people there.

asked the Prime Minister if she will list her official engagements for 23 July.

I refer my hon. Friend to the reply which I gave some moments ago.

Does my right hon. Friend agree that, just as it is possible for us to price ourselves out of jobs and work, it is also possible for us to price ourselves into contracts and work? Will my right hon. Friend therefore say what assistance she has had from the Leader of the Opposition and from the Trades Union Congress in explaining to the people that realistic pay settlements can lead to the creation of more jobs?

I agree entirely with my hon. Friend. Until our wage costs are the same as, or lower than, those of our main industrial competitors, they will get the jobs and we shall get the unemployment. Unfortunately, that fundamental fact does not seem to he realised by the Opposition, or, if it is, they go ahead regardless of it and fail to point out that heavily increased pay settlements, over and above productivity, will deprive people of jobs and increase unemployment. If they wish to reduce it, they should take my hon. Friend's advice.

I remind hon. Members that, on the motion for the Adjournment of the House on Friday 31 July, up to 10 hon. Members may raise with Ministers subjects of their own choice. Applications should reach my office by 10 pm on Monday next. A ballot will be held on Tuesday morning and the result made known as soon as possible thereafter.