Orders of the Day — European Community (Skimmed Milk)

Part of the debate – in the House of Commons at 12:00 am on 31 January 1977.

Alert me about debates like this

Photo of Mr James Scott-Hopkins Mr James Scott-Hopkins , West Derbyshire 12:00, 31 January 1977

It is always rather depressing to come back to a subject which has been debated on more than one occasion—in fact, many times—and to hear from the Minister that the situation is almost as bad now as when we first debated it. The skimmed milk mountain is still there, and it does not appear that much is being done to dispose of it. The scheme for the compulsory inclusion of skimmed milk in compound feeds disposed of a certain amount—450,000 tons. Nevertheless the quantity has increased, and even the writing-down by 30 per cent. of old stocks has not had the effect of reducing stocks greatly.

There is no doubt that the scheme that we are now debating, although it will increase the attractiveness of using skimmed milk in liquid or dried form, will not reduce the existing stocks that are now multiplying within the Community. Drastic action must be taken to dispose of the existing stocks, which in present circumstances cannot be put on the world market because there are no buyers. Even with a 30 per cent. write-down, they are unattractive and are unwanted. Surely the best thing we could do would be to write the stock off and dump it, figuratively speaking, in the sea or dispose of it by any means. The stock will go on increasing unless strict measures are taken. This enormous amount of dried milk, particularly the older stock, has a depressing effect on the market.

The reason for the ever-increasing level, as I was glad to hear the Minister say, is that there are many farmers in Europe, but not in this country, who are producing milk but should not be doing so because they are inefficient producers. It is about time that the Council took action on this. I have had the honour of serving in the European Parliament, and I know that many proposals have been put to the Commission for dealing with uneconomic milk producers, yet the Council has always shied away from taking the required action.

I hope that following the Minister's remarks only the most efficient producers will be encouraged to produce milk and that the inefficient and uneconomic producers will be discouraged. If it was made no longer worthwhile for an inefficient producer to produce purely for the intervention price, that would be one way of getting on top of the situation.

Of course, it is true that this is a voluntary measure and that there will be no compulsion upon pig or poultry producers or upon anybody else to use liquid or dried skimmed milk in their compounds. It is an effort by the Commission to make it more attractive and put it on an equal footing with soya and other protein feeds as an equally attractive additive to compounds. I am pleased that the proposal advocates something for which we have been pressing for some time—to make it easier for liquid skimmed milk to be supplied direct to the pig farmer. In this case there is no need for energy to be used to dry the milk, and if it is attractive to pig farmers to have liquid milk delivered direct at reasonable cost this must be done.

It seems that one can obtain this liquid skim only on contract, and it is difficult but vital to get a contract. I hope that the Minister will explain what the terms of the contracts will be, for how long they will last and what difficulties pig producers are likely to face in getting skimmed milk direct from the suppliers on contract.

The level of the subsidy and its cost are a reasonably good bargain for us, bearing in mind the total subsidy proposed by the Commission and the fact that there will be a clawback for us.

I hope that my hon. Friends will agree that the proposals are acceptable. They will not have a revolutionary effect on the unhappy state of the skimmed milk market. Something drastic must be done to get rid of excess old stocks. They must be disposed of at almost any cost because they are hanging over the market. Measures must be taken to stop the increasing size of the skimmed milk mountain, and this means removing the incentive for inefficient farmers to continue producing milk at their present level for intervention. There must also be subsidies to encourage farmers and compounders to use increased supplies of skimmed milk as opposed to other compounds such as soya.

I hope that the House will accept the proposals, which will go a small way to keep the level of skimmed milk, both liquid and dried, under control throughout the Community.