Ministry of Agriculture and Fisheries.

Part of Orders of the Day — Supply. – in the House of Commons on 7th June 1937.

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Sir F. Aland:

I do not think that he is a butcher. He is an ordinary man who keeps his eyes open and has heard complaints of working men on low wages, and of unemployed who could not afford meat at the price at which it is being sold nowadays in view, no doubt, of the fact of meat having shared in those rises of ordinary commodities which I have quoted to the Committee. I mean the increase of x8 points in two years, which has gone much steeper lately. I am not talking about meat alone. The general point is that inevitably the rise in the retail cost of food will make people feel whether they are getting what they hoped to get when they were asked to pay their share for the various things that were being done for the industry. There was a minor point which the Minister made, and that was the obvious one that one should not con-sider only the price the producer gets, but what he has to pay for essential things like fertilisers and feeding-stuffs. I will hot extend that, as we all know it, but undoubtedly there has been a very steep increase in many commodities during the last six months, and other people ought to realise that that is a handicap for the farmer.

There is a much bigger point than that. The opportunity of the farmer to render better service and to pay better wages is at present heavily limited by one outstanding thing, and that is his indebtedness: I say; Without fear of contradiction, that, with regard to a very large proportion of farmers in a very great part of the country those men are up to their earsin debt, and often over head and ears in debt, so that it is very doubtful whether they will ever be able to get out of debt. Some of us know the figures, but I am not going to quote them The hon.and gallant Gentleman the Member for Petersfield (Sir R. Dorman-Smith), whose recent lionour we were glad to see, and are also glad that he remains president of the National Farmers Union, will be able to give them. I believe that the figures may be what we call astronomical. It is mainly the banks that, I suppose, have been carrying the larger farmers through the long succession of very difficult years, Their balance sheets and their valuations were more easily available, bit the Smaller farmers in many district have been carried very largely by the fertiliser and feeding-stuff and cake merchants, and the auctioneers, and indeed by anybody whom they could get to give them credit, and, of course, they had to pay for that credit. In those cases where there is very little security because the farms are generally mortgaged up to the hilt, what they have to pay is apt to seem rather high. In a district known to me—not in my district or in my division—this credit is arranged sometimes by the farmer having to pay a higher price for what he buys, and sometimes by the payment of interest on what is owing.

I will give an illustration of each. The charge now for barbed wire from the merchant is 23s. 6d. compared with the Farmers' Co-operative Society price of 18s. 6d. If anybody begins to deal with the Co-operative Society, of course, the debt which is owing to the merchant is pressed. That is only human nature. The other system is that there is a charge of a shilling a ton a month for debts on fertilisers, which works out at about 12 or 14 per cent. a year. I am not blaming the merchant at all. He generally has to pay practically cash, and has to wait for years, and I fear that a lot of these debts will be bad, whatever happens. One of the things which stands out is that people who have lent money or given credit have not, in these difficult times, and sometimes it has been so universal and everybody has had to borrow, that they have not been able to distinguish the good from the bad, and some of the men are in a very bad way. That, if one understands it, explains a good deal. If anyone disputes it by bringing up the figures of agricultural, bankruptcies there is the obvious explanation that nobody puts through the bankruptcy court a man who has not any assets. You wait until he is doing much better.

The figures which I have taken from the Board of Trade returns are rather interesting. In 1931, which was a good year, there were 497; in 1934, 288; in 1935;.224; and in 1936, 125, which is a provisional figure. If better times come to stay and the demand for farms increases so that the banks and others will know that if a man is sold up there will be something more than is necessary to pay off arrears on land and clear the mortgage. There will be a great increase of bankniptcies, and some, I am afraid, will be quite unavoidable for the reasons I have given. That is the fact. Most farms are heavily in debt, and naturally not able really to tackle, within any reasonable time, those improvements in their land and those adaptations of their industry which the Minister and all of us will hope for as a result of what he is trying to do.