Orders of the Day — Bacon Industry

Part of the debate – in the House of Commons at 12:00 am on 1st December 1966.

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Photo of Mr Alick Buchanan-Smith Mr Alick Buchanan-Smith , North Angus and Mearns 12:00 am, 1st December 1966

If this is selective expansion, it is time that the industry noted what it means.

If this is not a deteriorating situation, I challenge the Parliamentary Secretary to tell us what it is. If this is the pattern of events which followed the last Price Review when the middle band was raised, and when the forecast of slaughterings falls to a rate at which we cannot even reach the middle band as it stands at the moment, it bodes very ill for the Minister's decision to raise the middle band again next spring.

Like so many pronouncements we have heard from the Minister—over the last few months we have had pronouncements on credit and other very important matters affecting agriculture—it looks all very well on paper; but I remind the Parliamentary Secretary that the pig industry cannot survive on paper. What we need is tangible results, and that is what we look for from the Government. But we certainly do not see them.

The Minister must be realistic. He has to face the facts of the situation. He should go out and talk to some of the producers. If he did so, he would find that talk in general terms about the middle band, and so on, means very little to the ordinary producer. If it is related to prices and the producer was told what the prices were to be, he would be more likely to understand the situation. The Minister must act now and act quickly. He must give a categorical assurance to producers about what the prices will be, an assurance that they will get a fairer return from their outlay than they are getting at present. He must take action of a positive nature. If he does not do that, he has no hope of regaining the confidence of producers, a confidence which he has so sadly lost. If he does not do this, I believe he might just as well fly to the moon if he thinks that raising the middle band will answer the problems of the industry.

In any case, if he does raise the middle band, it does nothing at all to help the curers in their present crisis. Nor does it deal with the basic imbalance between the pork and bacon markets to which I referred earlier. Even if this were some- thing worth while, the effect would be so long delayed—the time factor is so great in the production cycle that very great damage will be done to the industry before any good can come out of it.

While the Minister sits back and basks in his complacency, factories are closing. Secondly, the Danes and others are increasing their strong hold on our bacon market. Does not the Minister recognise that during the first eight months of this year imports of bacon cost £10 million more than the same period in the previous year? Does he not know that there is a balance of payments crisis?

The third point is utterly vital to producers. Next year, curers will be extremely unlikely to enter into long-term contracts, and this is where the real crunch comes for producers. Most of this pressure on the Minister so far has come from the curers, but let me warn him that when the present contracts run out in April he will be subjected to far greater pressure from the whole industry and not simply from the curers.

In the north-east of Scotland the factory of Robert Lawson & Son has already announced that it will not enter into contracts next year. Who can blame them? But what a tragedy this is for producers. In Committee on the Agriculture Bill a number of hon. Members laid emphasis on the importance of contracts in order to bring stability to the industry, and what industry needs it more than the bacon industry which is subject to so many fluctuations and to so many cycles? We stand to lose an important stabilising influence.

What should the Minister do? I should like to suggest four things. All of these things have to be done. It is no use doing just one and believing that one will work. The Minister has to tackle the short-term and the long-term problems. I suggest that these four things are: first, in dealing with the short-term problem he has to assist the curers. They need financial help if they are going to get out of their present plight. I would warn him that if the confidence of the curing industry is lost, then the bacon industry in Britain is finished.

Secondly, he has to gain the confidence of the producers, and the only way to do that is to relate his proposal to increase the middle band to prices, to give a categorical assurance that producers' returns will be improved. If he does not do this, he has not a single hope of expanding production in any way.

Thirdly, he has to look seriously at the question of separate pork and bacon markets with regard to the guaranteed price scheme. Finally, if the United Kingdom producers are to increase their share of the bacon market, and I believe that they should, I would ask the Minister to examine in detail the price at which the Danes send bacon into Britain. Can he, for example, explain how, during the first nine months of this year, when 180,000 tons of British barley were exported to Denmark, on which the Danish farmer paid a levy, and which went in part to the pig producers there at a cost of £27 per ton—I obtained those figures from the Ministry—yet despite those figures, they can still undercut the price of our pigs?

Is the Minister satisfied that competition from abroad is fair? I believe that it is to these matters that the Minister has to apply himself. We know the way he dealt with the hill farmers. Pressure was put on him from this side of the House, and despite all that he said to begin with, he eventually gave in to the pressures that we put upon him. He took some time to do it, and it will take some time to get this through to him, but it is not too late if he acts soon—