Orders of the Day — Agriculture

Part of the debate – in the House of Commons at 12:00 am on 3rd November 1966.

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Photo of Mr Michael Noble Mr Michael Noble , Argyll 12:00 am, 3rd November 1966

The point is made. If the hon. Gentleman does not like having his own Prime Minister quoted against his argument I cannot help it.

The hon. Member for Ross and Cromarty (Mr. Alasdair Mackenzie) spoke, I am afraid, when I was out of the Chamber to get something to eat. But the hon. Member for The Wrekin said quite openly that this was a crisis of confidence and that it was affecting the Minister's chance of achieving his National Plan targets. That being so, all the evidence from all the speakers on the Minister's own side has reinforced the crisis of confidence of which we have spoken.

In the last few minutes, I should like to turn particularly to the problems in the hill and upland country. I should like to mention the cattle trade there only briefly, because so much has been said about the cattle trade in the country as a whole. When replying to an Adjournment debate the other day, the Minister of State said that he did not believe that the average in suckled calf sales in the country was down by more than £5. The N.F.U. figures from Wales, Northern Ireland and everywhere else which I have collected suggest that the average is a good deal higher than that.

But whether this is so or not, the important point is that the average conceals the fact that although the big calves, generally coming from comparatively good ground, have sold fairly well, anyone who has been to calf sales in the areas where the hill calves are sold has seen drops of £10, £12 and £15 and in some cases no price at all being offered for the calves.

On the subject of wool, I should like to take up the point of my hon. Friend the Member for Nantwich. It is important that the House should realise that just as agriculture is such an important import-saver, so wool is part of that picture. We imported, in 1964, £146 million-worth of wool and, last year £115 million. If the Minister continues massacreing the sheep industry, there will also be a big bill to pay for the extra wool which we will need. Wool is an important raw material for many of our exports, whether in knitting, carpets or many other things. If we can build up a greater number of sheep, we shall have more wool and shall have to import less. Perhaps we will have a better balance of trade figure there as well.

I now turn to sheep. I agree with those who have said that, from 1957 to 1964, there was no increase in the price of mutton. This is true and so far as I was a Member of the Conservative Party, I must obviously take my fair share of the blame which is going for that. However, during that period, the "league tables" published year by year in White Papers of how different sections of the farming community are doing at a particular time show that there were many years when the hill sheep industry was far from the bottom of the table, when there was greater need to support, for instance, milk or pigs or some other part of the industry. Certainly, up to 1964, the sheep industry, although not entirely content—as they made clear to me very often—was not in despair.

But what has happened since then? They were certain that, after the big rise in 1964 to meet what they believed was the main problem—that of the low return for agriculture as a whole—which did not help them, they were confident that they would get something substantial in 1965. They did not, and they have had only ¾d. in 1966. From the fact that in the low ground sheep stocks have been sold off it is perfectly clear in order to grow barley, because there is more money in barley, that this, starting on the low ground, is beginning to back right up the hills now. Figures have been quoted many times in this House of the sort of drop in income that has occurred in the whole of the country this year—lambs varying from 10s. to £1 down, cast ewes from 10s. to £3. I have figures for Scotland, Wales and all over the country showing that the pattern is pretty uniform wherever one goes. That being so, it is difficult to see how the industry can have any real confidence.

I do not believe that this is entirely due to the credit squeeze—it is not. One problem was the weather—and even the Secretary of State for Scotland at his best cannot control that. The lambing percentage, down 15 per cent. this year, is not to be put at the door of the Secretary of State. [Laughter.] He has some very active rams just outside Kilmarnock.

It was after the middle of July that the real problem set in, and it was due partly to the credit squeeze, and partly to the accumulated lack of money in the agricultural industry which has been going on, alas, for the whole of the last two years, when farmers' incomes have not been fully recouped. It has been due partly to very large increases in taxation affecting agriculture—petrol duty, increases in licences, the Selective Employment Tax.

Incidentally, I did not think very much of the remark of the hon. Member for Enfield, East (Mr. John Mackie) yesterday that the interest involved in the Selective Employment Tax means only 4d. per week per man. The real problem, as he knows—if he employs a number of people and happens to have an overdraft—is that the bank has probably been told not to lend the money at all. It is therefore not a question of finding the 4d. per week but of persuading the banker, and the banker has been told that this is not something for which he can lend money.

We have heard a fair bit about the Irish Cattle Agreement, but I would remind the Minister that the picture is not particularly good in regard to sheep, either. In 1964, we imported in the form of carcases 2,000 tons of Irish mutton and lamb. This year, in those two agricultural months when our market is always very neatly balanced between glut and shortage, the figure was 3,600 tons. Again, in 1964 we imported 1,400 tons of fat sheep, and this year the tonnage is 5,400. These are not big figures, but they show the Government's bad housekeeping in arranging for these imports to come in at the critical moment when our own markets are always in some difficulty.

These, broadly, are the facts spoken to in all parts of the House and in every branch of the industry today. What do we expect the Government to do in the face of what is a serious problem, whatever the Minister may say, and one that is affecting all farmers in all parts? We do not expect the Minister to say that we can do nothing until the next Price Review, because the situation is serious. The right hon. Gentleman talks of the credits that the banks are now prepared to give to farmers but, as has been said from this side, it is months too late. Nor is this a question of the banks giving credits to farmers just for nothing. They charge a very handsome amount for that service.

The Secretary of State will realise, as well, that there is a particular problem in a number of Scottish islands where, on top of the extra trouble it always is to get sheep off the islands, they had, earlier in the year, a very considerable loss of money due to the shipping strike. They have an extra reason for needing special help.

It is not just that the farming industry is annoyed because Selective Employment Tax is not coming back to farmers, as to other industry, in the form of a premium. They know that the money they are paying in Selective Employment Tax today will come back in February, but they cannot use it. Particularly in the hill and upland areas there is no other money coming in until June and this money has to be kept to pay the next three or six months Selective Employment Tax with no relief to them.

What worries me is that at the moment there is a very serious squeeze at both ends of the industry. The right hon. Gentleman is looking at the clock, but I was interrupted a number of times and I shall still give sufficient time for a Secretary of State to reply to the debate. At both ends of the industry there is trouble. At the smaller end farmers have not the resources because the money is not coming in and they are facing a very difficult winter and spring up to next June, but at the other end a large number of farmers with some resources and real ability are talking today of going out of the industry because the return is so bad. This is much the more serious, in the long-term, for our agricultural industry.

The Secretary of State has a very difficult task for, if the Minister could tell us nothing in 45 minutes, I do not believe he will be allowed to tell us much. But I beg him to realise that this is a serious problem. We shall need cash now. Re-strictionist policies, if they ever made sense, do not make sense today. We have to go in for real import substitution. If the right hon. Gentleman can come with us on this the whole way, I can almost guarantee that the sheep industry—which is very near some important breakthroughs in new techniques and knowledge—will be able in 10 years to provide all the mutton and lamb coming from New Zealand today, if that is his wish.