I think it would be for the general convenience that we should discuss the Votes together. I should like to deal with the milk question first because it is in a department of its own, and does not really arise on the larger question covered by the general Vote. I shall be interested to hear the views of hon. Members upon it, because the wider one's knowledge of the different ways in which this problem is viewed in the different districts of England and Wales the sounder are one's chances of putting forward proposals of a generally acceptable and successful character. There is general agreement that the milk marketing scheme requires amendment, but not the same consensus of opinion as to the form which it is desired the scheme should take after the amendment has been made. The necessity for reform of the milk scheme should not blind us to its achievements in the past. It has produced very important results in the public interest. First, it has given producers a sure market for their milk. Those of us who were in this House before the scheme was launched will remember the state of uncertainty, and, indeed, despair with which milk producers viewed the future. When producers complain that the return which they receive is not adequate to their expectation I would ask that the matter should be considered from this point of view: Before the scheme was introduced there was a real danger of the milk market collapsing altogether, and the present prices must be viewed in contrast with that luckily-averted catastrophe. Further, there is now a secure market for all the milk that farmers produce. Secondly, the scheme has led to an expansion of 10 per cent. in our dairy herds. Had the scheme been as bad as some of its critics seem to imagine it, I do not think that result could have been achieved. As I have frequently said, the maintenance of an adequate livestock population in this island is essential to the fertility of the soil.
In the third place, the milk scheme has, so far, rendered possible a start on the great question of improving the quality and increasing the consumption of this vital food. Examples of success in that direction are not hard to find. In the last financial year the amount of milk sold in the liquid market increased by 12,500,000 gallons, and the quantity for manufacture increased by 8,000,000 gallons. We often say that people in this country do not drink enough milk, and statistics are produced comparing the consumption per head in this country with what it is in other countries. It should not be forgotten that if as a nation we are not great consumers of liquid milk—though we hope to see a very material increase—yet we are very considerable consumers of butter, ranking very high among the nations in the amount of butter eaten. We have always been in that position, but the recent increase in the consumption of butter is striking. In 1925–29 the consumption was about 16 lb. per head, and in 1936 it had risen to 25 lb., which shows that with greater purchasing power the people are consuming more milk products. If they prefer to take milk in the shape of butter rather than as milk, that is largely a matter of taste, and in some degree, also, it is due to the difficulties which beset the consumption of liquid milk. The right hon. Member for East Edinburgh (Mr. Pethick Lawrence) drew my attention to a scheme in operation in Sweden where the price of milk is firmly based upon the butter price, but it is a high butter price. Had such a scheme been in operation in this country, though it might have cheapened milk, it would have cost the consumers of butter in this country about £11,000,000.
Turning to the important pig and bacon marketing schemes, last Christmas the schemes suffered a setback of a severe character. Producers failed to contract for the necessary number of pigs, and the Bacon Board exercised their right of repudiating contracts. Three causes have been assigned for the failure on the part of producers to contract. Among them was, no doubt, the temporary advantage which was to be secured in the open market, by way of prices. Secondly, there was a feared insecurity in some people's minds, so I am told, as to the position which would be created by a rise in the cost of feeding-stuffs. Those causes have been assigned, but those are all matters which provide most admirable material for the consideration of the pig scheme which may replace the existing one and be free from some of its defects.
This is a difficult and complicated matter. Here, again, I have received a large number of representations from the boards and others concerned. Let not the temporary difficulty in which this organisation finds itself blind us to the remarkable achievements of the schemes while they have been in existence. The pig population has risen by 42½ per cent. since 1931, and production of bacon has gone up 70 per cent. The quality has greatly improved. Not only has the larger quantity improved in quality, but English bacon, owing to the increased commercial production, is no longer the luxury article which it was presumed to be, but is being produced in grades suitable for the public taste and is entering into competition with grades which were previously imported from abroad.
With regard to both milk and bacon, I urge upon the Committee the desirability of maintaining the improvement in quality which both the marketing schemes have rendered possible. In the case of milk there has been an immense increase in the number of persons producing milk of accredited standard. Before the scheme was introduced there were only 800 grade "A" licences, but now there are nearly 20,000 producers of milk of accredited standard. I have already referred to the improvement in the quality of bacon. When a fair review is made of these two schemes—one is awaiting amendment and the other is suffering a certain amount of difficulty owing to repudiation of contracts—we have to make certain that ground has been gained. We have to learn from the past the experience which is necessary to enable us to remodel them nearer to the heart's desire.
Eggs and poultry present a very difficult problem to a Minister of Agriculture. The conditions under which the industry has been built up and under which it is now carried on do not render it immediately amenable to the sort of scheme which has been of benefit to other branches of agriculture. It is a very important branch. The annual production is valued at £25,000,000, of which about two-thirds represent eggs and one-third represents poultry. It is also a very widespread industry. Nearly every farmer and smallholder is engaged in it, and, in addition, there are thousands of specialised producers. The industry developed very rapidly after the War and, in the 10 years ended in 1933, had actually doubled its size. That development was possible because of the very low level of prices of feeding-stuffs in relation to egg prices. In that period, poultry keeping was one of the most remunerative of all branches of agricultural production. It may be that that time of prosperity has produced in the minds of the producers no inclination to seek reforms of marketing, and that may be one of the difficulties with which we are confronted.
It has always to be remembered that expansion in the poultry industry is possible on a very narrow margin of capital. Many large poultry enterprises have been built up out of profits. Since 1932 the relationship between feeding-stuff prices and egg prices has been less alluring and expansion has been checked. The real difficulties of the industry began in the autumn of 1936 when the world prices of feeding-stuffs reached high levels compared with those of recent years. That situation was accompanied by a temporary period of low egg prices. Feeding-stuff prices have remained high, but egg prices have improved and are above the level of recent years. In the week ended 2nd June, the average price of eggs in country markets was 1s. 1½d. per dozen, which was 1d. per dozen higher than last year, and 3d. per dozen higher than in 1934. No doubt many specialist poultry keepers are feeling the present position very hard. They are very often men of small capital, depending entirely upon purchased feed-stuffs, and they feel acutely that rise in their costs of production. The general farmer can continue to use his own produce as sustenance for his fowls, and he does not suffer to anything like the same extent. He is always able to turn his hens out on to suitable fields, and the exercise which that gives them means that their health is improved in the process. The position is very different for the man who has to buy everything with which to feed his fowls.
Another contributory factor to the difficulties through, which the poultry industry is passing is the absence of any properly developed marketing association or organisation. While the industry has developed in the post-war years, the arrangements for marketing the produce are little different from those direct or even casual methods which sufficed when the bulk of English new laid eggs were absorbed locally at very near the point of production. The National Mark scheme was a step in the right direction. It merited better support than it has received. Unfortunately, it embraced only a small proportion of the total supply, though its influence for good was far greater than the figures suggest. A more elaborate scheme for the organisation of the industry was suggested by the Reorganisation Commission which sat in 1934, but whose report did not prove acceptable to the industry. No satisfactory alternative to it has so far been forthcoming.
Another thing which afflicts this industry is the high level of disease. There seems to be a general deterioration in the stamina of poultry stocks. Upon the recommendation of the Reorganisation Commission my right hon. Friend the Secretary of State for Scotland and I set up a technical committee to consider the present methods of distribution of hatching eggs, day-old chicks, feeding-stuffs and so on. We are making very strenuous efforts to lessen the toll of mortality among the chickens. We shall be preparing further proposals as I announced to the House not so long ago. There is also the question of the importation of eggs from abroad. The matter is naturally being given a great deal of consideration, and the producers have directed their attention to it in the belief that it is one of the major causes of their difficulties. I think that the causes to which I have previously alluded have bulked as large. Imported eggs form less than one-third of the total supply. I cannot discuss this matter further because an application for increased duties is being considered before the Import Duties Advisory Committee, and I cannot offer any, comment upon it at this stage. Imports tend to fluctuate in a very curious manner; but it must be remembered there also that a number of those who do compete with us in our own market most severely, the Danes and the Dutch, are under a similar disability with regard to the cost of feeding-stuffs, being practically as dependent on pur- chasing them abroad as we are. All these matters must be taken into consideration when we come to negotiate revised trade treaties. At that time the position of the poultry industry will be given attention.
There is only one other remark I will make on the questiOn of Import Duties. The Reorganisation Commission did recommend an increase of 6d. per long hundred on all imported eggs, and recommended that 25 per cent. of the income derived from all duties on eggs should be ear-marked for the industry, but the Commission made it clear that the recommendation was intended to be supplementary to the recommendation for the organisation of the industry and that the fund should be applied for the development of the industry. The present import position is that there is a specific duty on eggs arriving from foreign countries; it varies from is. 9d. to 1s. per long hundred according to the size of the egg. It is a specific duty and its ad valorem incidence varies with the price which the eggs happen to be fetching at the moment. At the lowest price reached in recent months it was in the neighbourhood of 20 to 25 per cent.
There have been various other suggestions for dealing with the poultry industry and I assure hon. Members that I am very sympathetic indeed to the plight in which many of these small specialist producers, relying on imported feeding-stuffs, find themselves. It is an industry which has had a remarkable and indeed triumphant expansion and we shall do what we can to secure that it is not allowed to slip back. The position is full of difficulty but it will receive most earnest consideration.