Clause 8. — (Orders Empowering Authority to Deal in Home-Grown Cereals.)

Orders of the Day — Cereals Marketing Bill – in the House of Commons at 12:00 am on 9th March 1965.

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5.0 p.m.

Photo of Mr Martin Redmayne Mr Martin Redmayne , Rushcliffe

I beg to move Amendment No. 5, in page 7, line 2, to leave out from "practice" to the end of line 3 and to insert: except when by agreement between the authority and the trade it is clearly impracticable to so do". I wonder whether, with your permission, Mr. Deputy-Speaker, I might go as much out of order as the Minister did in paying me a compliment. My only comfort at this moment is that I have a very good team with me both on the Front Bench and on the back benches. I wish that I shared the Minister's confidence in my ability to express myself clearly, but, after 13 years in the Whips' office, I shall have to do my best and, as one says when sitting over there, "see how we get on".

In the calm of the resumed debate on this point in Committee, the Parliamentary Secretary said that Clause 8 had been discussed with a certain amount of pleasant acrimony. I thought that a splendid Parliamentary term. I can remember many occasions when I should like to have used it myself, with as much justice. I did not take part in that debate, but, perhaps on that account, I have been able to take a fairly objective view of what the arguments were and of the points which were arrived at.

It is clear—I suspect that the Parliamentary Secretary will agree—that in Committee he aroused a considerable suspicion that the trading powers of the Authority were viewed by the Labour Government not simply as a useful reserve power within the ambit of the Bill, but as something having a certain doctrinal significance. The suspicion was created in the minds of my hon. Friends that these powers would be an end in themselves, perhaps as a first step towards a commodity commission in some form, rather than as a simple means towards the accepted and agreed ends of the Bill.

When the debate was resumed, the hon. Gentleman, aided, perhaps, by a new brief, seemed a little less sinister in his approach. I do not blame him for a new brief—I know enough about the machinery of Government to understand how that sort of thing happens—but it is not unreasonable now that we should return to the question and have the answer re-stated on the Floor of the House with the publicity which accompanies such statements.

The burden of the case put by my hon. and gallant Friend the Member for Eye (Sir H. Harrison) was that the Authority must operate through the trade. We all know that this was the nub of the agreement reached between the parties to the negotiation conducted by my right hon. Friend the Minister's predecessor. The Parliamentary Secretary's first statement on this point, right at the beginning of the debate, was unexceptionable. He said: We know that it was part of the agreement between the farming and trade interests that the Authority would operate through normal trade channels. I think that was only fair and practicable, and it would clearly not be fair to alter the Authority's buying operations, which in any case will be limited in comparison, to disrupt the normal procedures of the cereals trade."—[OFFICIAL REPORT, Standing Committee A, 11th February, 1965; c. 181.] If the debate had ended there, I doubt that my hon. Friends would have had very much to complain about, but only in the next column the hon. Gentleman is reported as using words which qualified that statement to a considerable extent, suggesting that, when the Authority was buying on forward contract, it was conceivable that it might not always be practicable for the Authority to make all the forward contracts it considered desirable, or, equally, if it was buying spot, it would not be able to buy all the grain which it required in the circumstances. My hon. Friends could not conceive of circumstances, looked at in a commercial sense, in which this statement of the hon. Gentleman's would be justified.

I think it fair to say that, as the debate proceeded, the Parliamentary Secretary's position rather deteriorated. I will not say that it was a question of O, what a tangled web we weaveWhen first we practise to deceive". But I know enough from past experience, as, I am sure, the Parliamentary Secretary does, that, very often, the more one tries to explain a point in the House the more tangled the explanation becomes. Nevertheless, a few minutes later—this is column 185—the hon. Gentleman said that the Authority would be buying at a time when the grain trade faces difficulties and the merchants are not able to do the job and so on. My hon. Friend the Member for Edinburgh, West (Mr. Stodart), commenting on that, said that he saw no reason—I know that my hon. Friends with experience of the trade agree— why dealers should not lay their hands on the grain if the Authority is able to do so. This seems a reasonable enough proposition.

Matters became even worse, and we read in column 198 of the OFFICIAL REPORT of the Committee's proceedings on the same day that the Parliamentary Secretary said: All I said distinctly, discussing this Clause, was that if the Authority were given power to trade it must be given complete freedom to trade in every way". With that we could not have got further from the truth.

At the next sitting, peace broke out and we came back to "Square 1". The Parliamentary Secretary said: We have written it in as near as we can to the agreement that was reached in September. I do not think that anybody has anything to fear, and I hope that the Clause will now be accepted."—[OFFICIAL REPORT, Standing Committee A, 16th February, 1965; c. 210.] How often have I heard that said, too.

It is not unreasonable, after that interesting kaleidoscope of quotations, to ask which of the interpretations is correct. We want to know that the Government have no intention of allowing the Authority to go beyond the agreement reached by the parties to it, and they have no intention of using this Bill as a means of introducing compulsory trading powers to undermine the acceptable and accepted patterns of the trade.

In this connection, it is not, perhaps, irrelevant, although a little out of order, I suspect, to refer to an Amendment which you have not selected, Mr. Deputy-Speaker, in Clause 18, page 14, line 33, which refers to the accumulation of funds by the Authority to an extent which one might regard as excessive. In this connection—this is entirely relevant to my previous argument the Under—Secretary of State for Scotland said: In other words, these funds could be used, as I understand it, for any purpose in connection with trade …"—[OFFICIAL REPORT, Standing Committee A, 23rd February, 1965; c. 321.] One sees at once that, if we choose to have a suspicious mind in this matter, that quotation is much in point. Those words in that connection, taken by themselves, seem to destroy the whole conception of reserve powers.

In fact, I have no possible reason to believe that the Parliamentary Secretary's first and last statements were not correct, but, if we could have that confirmed from the Box now, it would make Us considerably more happy about the Bill.

Photo of Sir Harwood Harrison Sir Harwood Harrison , Eye

I should like to support my right hon. Friend the Member for Ruchcliffe (Sir M. Redmayne) in the Amendment. He summed up our deliberations in Committee extremely well, considering that he was not there. This shows the view of somebody unbiassed reading the OFFICIAL REPORT of the Committee—that, as I pointed out then, the first reply of the Parliamentary Secretary was acceptable but that those replies which were made off the cuff went too far. Since then I have been in touch with members of the trade, and it is clear that the hon. Member has alarmed them. I believe that they have been to see him about what he said.

If the Government accepted the Amendment it would give assurance to the trade. As the Minister said earlier, the Bill is based on an agreement not only with the N.F.U. but with the National Association of Corn and Agricultural Merchants. It is felt that this Clause is a departure from the agreement arrived at. I had hoped that the Minister would speak in the debate and would accept the Amendment, and that he would thus meet some of the fears which have been aroused in the minds of the traders about the Authority having all this power. As I pointed out in Committee, the Clause makes the position rather a nonsense. I believe that the Minister could go a long way to reassure us by accepting the Amendment.

Photo of Mr John Mackie Mr John Mackie , Enfield East

First of all, considerable play has been made of what I said by the right hon. Member for Rushcliffe (Sir M. Redmayne), who has obviously read the HANSARD report of the Committee meetings very carefully. There has been some assumption that I have retracted in some way what I said. I would say now that I do not retract in any way from the first thing I said, all I said in between that and the last thing I said, and, indeed, the last thing I said.

I was amused at the suspicion that we on this side of the House would consider the reserve powers to trade as the be-all-and-end-all of the Bill rather than just reserve powers which might be required. If the right hon. Gentleman has read the HANSARD of the Committee stage as carefully as he makes out he will know that some of his hon. Friends asked us to take these powers straight away. This shows that we are not alone in thinking that the powers might be necessary. I am sorry that he has used the word "sinister". It was used before, and I am certainly sorry to give that impression. We will do our best to see whether we can allay that fear.

From what the right hon. Gentleman said it appears to have been assumed that if I had stuck to my brief we should have got on better. Perhaps I had better stick to my brief today. Nevertheless, it was part of the agreement reached between the trade and the farming interests that the Authority would operate through the trade channels and it was not intended to allow the Authority's buying operations, which would in any case be limited, to disrupt the normal procedures of the trade. This is the origin of the provision in the Clause as it stands.

The effect is to require the Authority, when it is exercising its powers to buy cereals, to conform to the normal trade practice in buying from or through established dealers so far as appears to the Authority to be practicable to do so. The right hon. Gentleman said that there was a good deal of discussion in Committee on an Amendment moved by hon. Members opposite which sought to delete the words so far as appears to the Authority to be practicable to do so. The hon. Member for Edinburgh, West (Mr. Stodart) asked the reasons for that phrase and asked when it would be impracticable to do so. It was in answering that question that this sinister thought was supposed to be brought into my mind.

5.15 p.m.

But I should like to repeat the examples which I gave. First, if we are giving the Authority power to trade then we must not inhibit it. It must have complete scope to trade in any way and must not be inhibited in any way. The second point which I made was that farmers might not wish to sell to the trade. They might wish to sell direct. I called the attention of the hon. Member for Edinburgh, West to the fact that there might be occasions on which farmers could not find merchants and that there might be merchants who were in dispute with farmers in an area where there were only one or two merchants. I made the point that merchants could—I do not say that they would—take too much commission and hold the Authority to ransom. We hoped that such a situation would not arise but we had to allow in the Bill for anything like that happening, and that is why we put in this Clause.

It appears from the Amendment that we were able to persuade hon. Members opposite that the obligation imposed on the Authority by this Clause should be limited to what is practicable. But the Clause as it stands leaves the decision as to what is practicable in any given set of circumstances to the Authority itself, and this is only right. I emphasise that it would be wrong to inhibit the Authority in trading. The Authority will, after all, be responsible, and as I emphasised in Committee we can rely on it to honour its obligations.

The Amendment would have the effect of leaving the decision as to what was practicable in a given case to be arrived at by agreement between the Authority and the trade. This is tantamount almost to giving the trade the right to stop operations, bearing in mind the time factor and everything else and the argument which would go on.

I am sure that the Authority will be able to count on the wholehearted co-operation of the trade in furthering the objectives of the Bill, but it would be wrong to put the trade in the position in which it could dictate to the Authority the terms under which it would conduct its buying operations. This would create an intolerable situation for the Authority. I hope that the House will agree that the Amendment should be rejected.

Photo of Mr James Prior Mr James Prior , Lowestoft

I feel that we have allowed the Parliamentary Secretary to get away with one or two remarks on which he ought to be taken to task. First, he said that my hon. Friends advised the Government to take these powers straight away. If he reads the report of the Committee stage he will see that what we were suggesting was that these powers might well be necessary but that it would be better, if they were to be taken at all, that they should be taken by direct decision of Parliament rather than being pushed on to us after the powers had been used. In the latter case in due course they would be put to Parliament for approval. That was the objection which my hon. Friends and I had to the use of these powers.

It is easy to understand why the hon. Member does not retract the words which he used in the middle of his various speeches in Committee. As far as we know, he believes in commodity commissions, and he would like to see the Government introducing them. It is, therefore, even more remarkable that the Government should have swallowed this excellent Bill, which is planning by consent, hook, line and sinker. I must remind them of the speech made by the First Secretary in a debate on 29th June, when he said that a Labour Government would introduce commodity commissions and establish rather more producer boards with real marketing powers. He said, I do not mean some of the half-baked things that pass for marketing boards these days."—[OFFCIAL REPORT, 29th June, 1964; Vol. 697, c. 1051.] It is, therefore, quite understandable why the Parliamentary Secretary should have taken the view in Committee which he there expressed.

The words which we have suggested are clearly words which are acceptable to the trade and they are not so binding on the Authority as the Parliamentary Secretary has made out. After all, all that the Authority has to do is to ask a member of the trade to buy for the Authority. There are many members of the trade and, if that request is at all reasonable, it will be met.

The trade has some ground for fearing that the Government's intentions in this respect are not quite what is written in the agreement. In view of the great concessions which the trade has made, the least the Government can do is to accept the Amendment for which the trade has asked. I hope that the Parliamentary Secretary will reverse his decision and allow us to have the Amendment.

Photo of Mr James Scott-Hopkins Mr James Scott-Hopkins , North Cornwall

I am sorry that the Parliamentary Secretary has been so unreasonable and has broken the harmony which has existed between us until now, but perhaps I can persuade the Minister to change his mind and to restore that harmony. After all, we are not being unreasonable and what we are asking will not put the Authority in any difficulty. The Amendment is perfectly practicable and will allay a great deal of the anxiety which has been caused by what the Parliamentary Secretary said in Committee. I am sorry that the hon. Gentleman was so bellicose when he said that he would not withdraw a single word of what he had said in Committee from this or that column and that all of it stood from beginning to end. That is a great pity, because it means that the Authority is to have complete scope to be able to trade as it likes.

The agreement drawn up among all the parties before the Bill was introduced said that the Authority should use trade channels as much as possible. Notwithstanding anything the Parliamentary Secretary has already said, it is very difficult to envisage a situation in which the trade, on behalf of the Authority, could not get hold of any grain which the Authority might wish to buy, either on forward contract or spot.

The Parliamentary Secretary said that in country areas there might be farmers who did not wish to sell to a merchant because of some disagreement between them. Has he any experience of that ever happening in remote areas, or in any country districts? Even if there were a dispute between a farmer and a merchant, more than one merchant serves an area and trade channels could perfectly well accommodate a situation like that.

I ask the right hon. Gentleman to study the Amendment again. Of course we accept that the Authority will be reasonable and responsible, but so will the trade. The only way to make the scheme work is for all parties to behave responsibly. The Parliamentary Secretary imputed something which he should not have imputed when he suggested that only the Authority would act responsibly, thereby suggesting that the trade would not and implying that the trade might blackmail the Authority. If that kind of situation should develop, and I am certain that it would not, the whole operation of the Bill would come to naught.

With that in view, I ask the right hon. Gentleman to reassure us, not only hon. Members, but people outside the House, and to say that he means the trade to be the channel which should be used in 99 per cent. of the cases and that he accepts that the trade will always act responsibly. If that is so, I can see no reason why he should not accept the Amendment and say that agreement should be reached between the Authority and responsible members of the trade before the Authority resorts to going into the market of its own accord. We do not want in any circumstances to have parallel organisations in which the trade and the Authority are competing in the same markets for grain, either forward contracts or spot.

I ask the right hon. Gentleman to be reasonable and understanding and to allay the fears of hon. Members and of people outside the House. We all want to see this Authority work properly and we all have in mind the best interests of orderly marketing. If the right hon. Gentleman cannot accept the Amendment, I certainly cannot advise my right hon. Friend to withdraw it.

Photo of Mr Keith Stainton Mr Keith Stainton , Sudbury and Woodbridge

I have not found it easy to decide the right approach to this rather perplexing problem. On the one hand, I favour the Clause as it stands having regard to these factors. The first is the need not to restrict the Authority and with that to tie in the important point of marketing tactics. It should also be borne in mind, and I am surprised that the Minister has not made this point, that nine out of the 21 to 23 members of the Authority are to be recruited from the trade and will, therefore, presumably be able to exert considerable influence on the precise procedures to be adopted by the Authority. Another matter which has worried me is that we have embodied into this provision the idea of established dealers—a licence to a living from now on. I do not like this, for the trade always has changed and always will, and this suggestion gives me cause for alarm.

Having put those arguments on one side of the balance sheet, it must be borne in mind on the other side of the account that it is not just a matter of the composition of the Authority, or what is in writing in the Bill, which will make the new scheme work. This is to be a very big venture which will come under stresses and strains and, if it is to get off the ground, it will need the utmost good will and co-operation of all parties.

Despite what I have said about the membership of the Authority and the safeguards implicit in that alone, if the trade comes into this new marketing situation with any kind of fears or doubts, or looking over its shoulder, that would be a grave disservice to what could be a cornerstone of agricultural marketing in this country if handled properly.

I hope that I shall not stray too far from the Amendment if I invite the right hon. Gentleman to comment on the fact that the first two words in subsection (4) are "in buying", while there is no reference to selling. Subsection (3) might cover the act of selling as well as buying, but this is very obscure and I doubt the wisdom of the drafting.

5.30 p.m.

Photo of Mr Thomas Peart Mr Thomas Peart , Workington

I will respond to what has been said by hon. Members. I am reasonable, and I think that our approach has been reasonable. The hon. Member for Lowestoft (Mr. Prior) tried to raise other issues which I should be out of order in discussing. The concept of commodity commissions dealing with imports, which was proposed on a previous occasion, and matters of that sort are outside the scope of the Bill. It would, therefore, be improper for me to get involved in arguments with the hon. Member for Lowestoft, however attractive they may be and however much I used to enjoy being involved in them. He is only trying to provoke controversy where controversy should not exist.

I have noted what the right hon. Member for Rushcliffe (Sir M. Redmayne) said about my hon. Friend the Joint Parliamentary Secretary. In Committee my hon. Friend merely repeated over and over again that we must allow the Authority to have flexibility. This is what we have tried to ensure throughout our discussions on this very important part of the Bill dealing with the trading functions of the Authority which, broadly, are covered by Part II and which are involved specifically in the Clause and the Amendment. I cannot go beyond that.

We are, of course, anxious to have the co-operation of the trade. This agreement is the result of co-operation. I have stressed throughout that we must have a partnership. I note what the hon. Member for Sudbury and Woodbridge (Mr. Stainton) said. If the Authority does not get off the ground, if there is bad will on the part of any section, whether producers or the trade, who are partners to the agreement, it would be bad for all. I am anxious that the Authority shall work and shall act in the best trade practice.

Mention has been made of the composition of the Authority and of the fact that on the Authority there will be representatives of the trade and therefore that it will not act stupidly. We must assume that the members of the Authority will be reasonable people. If we assume that, we must not restrict them. The purpose of the Amendment is to exert a veto. My hon. Friend the Joint Parliamentary Secretary has stressed over and over again that the Clause as it stands leaves the immediate decision about what is practicable in any circumstances to the Authority. I should have thought that this was right. The hon. Gentleman mentioned an obscure point. There may be some substance in it, and I am prepared to consider it. But this is a matter for the Authority, and I give the assurance that it will conform to normal trading practice.

I have no desire to alienate anybody or to create fears among people who have concluded in principle an agreement with the producers and the Government of the day. I have fulfilled my promise. I accepted this agreement. Although it was concluded by my predecessors, I endorsed it. Hon. Members opposite must accept this. I believe that if we can get the trade and producers together, it will be a step towards the sensible and orderly marketing of home-grown cereals. This is what I want. We can argue about other matters, but that would be out of order. I want a successful Home-Grown Cereals Authority working in the interests of the trade, the producers and the country. Our legislation is designed to achieve this.

I hope that hon. Members opposite will not seek to shackle the Authority and weaken its position. In certain circumstances we must give it some measure of discretion. I have said this over and over again. No one must dictate to the Authority. This would be very bad. It would be very awkward if we put the trade in a position where it would be able to dictate to the Authority the terms on which it was to conduct its buying operations. This will come through agreement. The men on the Authority are drawn from the trade. What more can we do? This is reasonable, and I hope that hon. Members will accept it.

The Amendment uses the phrase "to so do". The phrase "so to do" has also been used. When the right hon. Gentleman spoke, he used the phrase "to do so". That is better grammar, and I would certainly prefer it. However, the wording of the Amendment is not very effective. I beg the Opposition to be reasonable. Here is an agreement, here is legislation, here is an Authority comprised of the trade and producers, and here is an opportunity to let the Authority go ahead and to wish it well. In view of this, I do not think the Amendment should be accepted.

Photo of Mr Martin Redmayne Mr Martin Redmayne , Rushcliffe

By leave, I should like to speak again.

Although the Minister has scolded us a little, his statement was very different from what the Joint Parliamentary Secretary said. He said that he stood by every word which he uttered in Committee. The Minister has got it on record that he is most anxious to have the co-operation of the trade. He speaks about shackling the Authority and exerting a veto, but if we accept that Part II of the Bill will work only if it is carried out with the co-operation of the trade our Amendment is perfectly acceptable. I do not think that the point about whether the phrase should be "so doing" or "doing so" is very important.

These things always depend on atmosphere. Almost all management is a matter of maintaining good temper, whether it is in trade circles, in political parties or in the House of Commons. I say in credit to the Minister that his speech has certainly improved the atmosphere, but we do not accept the argument that the Amendment would allow a veto to be exerted.

However, I think that we have taken this point far enough. I will not seek to withdraw the Amendment. I should like it to be negatived just as a small signpost of our views, which we hope will be permanently marked by the Minister.

Photo of Mr Eldon Griffiths Mr Eldon Griffiths , Bury St Edmunds

I have a reasonable attitude to the Bill because I believe that I was the only Suffolk Member who did not serve on the Committee. I have this distinction because at that time I was serving on the Committee considering the Murder (Abolition of Death Penalty) Bill. Now that I have been released from those duties, I feel it right, as a Member representing a very considerable cereals growing constituency, to make one or two comments on the Amendment.

The Minister said that he is a reasonable man. I say at once that his tone and words have been very reasonable indeed. I was, however, struck by his use of the words "dictation", "shackle", and "veto". As a reasonable man, I cannot see how the Amendment adds up to dictation by the trade to the Authority, or that it shackles the Authority, or that it involves the question of a veto. I am sure that the Minister, as a reasonable man, would agree with me on that.

It is, however, the Minister's logic which surprises me. Having said that the Amendment would build in dictation to the Authority's organisation and would shackle it, he went on to say to hon. Members on this side, "You need not worry, because the trade is on the Authority anyway". We are asked, "If members of the trade on the Authority are treated as reasonable men, why should not they be treated as reasonable and co-operative when they are off the Authority?" All that the Amendment seeks to do is to ensure that the Authority consults and reaches agreement with the trade.

The Minister's answer is, "The trade is already on the Authority". I suggest that there cannot be any reason for disagreeing with the Amendment from a reasonable point of view because, as we all know perfectly well, the Authority cannot work without the agreement of the trade. All the Amendment seeks to do is to assert what we all know to be a fact—that there must be agreement between the trade and the Authority if it is to work. As, I hope, a reasonable man, I cannot see what the Minister has against the Amendment. There are no shackles and there is no dictation here. I ask the Minister, with humility, to think once again.

Amendment negatived.