Clause 2. — (Hydrocarbon Oils, Petrol Substitutes and Power Methy Lated Spirits.)

Part of Orders of the Day — Finance Bill – in the House of Commons at 12:00 am on 1 December 1964.

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Photo of Mr James Scott-Hopkins Mr James Scott-Hopkins , North Cornwall 12:00, 1 December 1964

I support my hon. Friend the Member for Rye (Mr. Bryant Godman Irvine) in the Amendment which he has moved.

I protest strongly at the absence of the right hon. Gentleman the Minister for Agriculture and his two Joint Parliamentary Secretaries. None of them has seen fit to come and listen to the debate. This is not the first time that this discourtesy has been shown to the Committee when a matter of great importance to the agricultural industry has been discussed. It happened in connection with tied cottages when the Protection from Eviction Bill was being discussed. I suggest that the Chief Secretary should ask his right hon. Friend to come here as a matter of urgency so that he can listen to something which will have a great effect on the two industries. I register once more my protest at the Minister's absence.

My hon. Friend has estimated that the total cost to be borne by the farming industry as a result of the imposition of this duty is about £2½ million. There is no question of the industry being able to recoup its costs. There is no question of it being able to raise its prices to get a certain amount back. We have been over this subject in the years gone by. In 1961, the same point was made from the other side of the House by me and my hon. Friends when the duty was raised by an even smaller amount than this. It was pointed out that there was no way in which the farmer could recoup the extra impositions put on him and his industry by this kind of budgetary system until the operation of the Price Review which takes place in the months ahead.

The farmer has had to bear the cost of these increased duties himself, and then hope that at a later date he can recoup the money which he has spent during the months between the imposition and the Price Review. This is grossly unfair, and, although it has an inflationary effect, the farmer does not raise the cost of his produce. Hon. Gentlemen opposite cannot point to a single farm product the price of which has been, or is to be, raised because of this duty, even though it considerably increases the costs to the farmer himself and to the industry.

Let us consider the cost which the agricultural industry has to bear. The President of the N.F.U. has calculated that the actions of the right hon. Gentleman and his friends during the past 40 to 50 days have added about £23 million to the costs of the industry, and this proposal is just a further addition to those costs. I presume that the Chief Secretary will say that this will be taken into account in the Annual Price Review in March next year. I hope that he will. If he has consulted his right hon. Friend the Minister of Agriculture, he will be forced to say that, or perhaps once again the right hon. Gentleman has no interest in this sort of thing, but I find that difficult to believe.

I turn for a moment to the incidence of this tax. I understand that heavy hydrocarbon oils are not affected by the duty which is being raised by this Clause, but this duty does affect petrol and derv used in tractors on farms, and, as my hon. Friend said, it affects the horticultural industry because of the light machines which are used in that industry. I am sure that the Chief Secretary knows that it is the small farm and the small farmer who will have to bear the maximum burden of this increase of 6d. in the tax.

I have many small farmers in my constituency. Indeed, in the West Country they make up the largest proportion of farmers. These are the people who will have to bear the bulk of this extra cost of £2½ million, because often they do not use the more powerful and bigger diesel tractors. They use petrol tractors and tractors which use derv. They also use other types of machinery which require this type of fuel for their operation. Thus, I think that it is fair to say that the incidence of this tax will be concentrated on the small farmer, the one who is least able to bear it. I am certain that the hon. Member has not realised this. Perhaps the Minister of Agriculture, who shows his lack of interest in this matter by not attending, has not pointed it out to him.

I shall not go into details of the exact cost of running a tractor for so many hours on this or that type of fuel, but I do not think that the industry is in a state to bear this extra tax. I am sure that the small farmer is not in a position to bear it, on top of the other extra costs which the Labour Government have imposed on him and upon the industry generally in the past few weeks.

It is extraordinary that the hon. Member for Kettering (Sir G. de Freitas) is not here, because he made a smashing attack on the increase on the fuel oil tax in one Budget. He should be here to reinforce our attack upon the effect of this proposal on the farmers.

This is an unfair tax. The Amendment has a most respectable precedent and it should be adopted. This tax will bear harshly upon the small farmer, who can least bear it. This loss cannot be recouped in the forthcoming Price Review, because there is so much to be recouped already—£23 million or £25 million. It is disgraceful that the Minister of Agriculture or one of his two Parliamentary Secretaries should not be here. I hope that the Committee will support the Amendment.