S. and W. Berisford

Oral Answers to Questions — Agriculture, Fisheries and Food – in the House of Commons at 12:00 am on 12th June 1986.

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Photo of Mr Richard Livsey Mr Richard Livsey , Brecon and Radnor 12:00 am, 12th June 1986

asked the Minister of Agriculture, Fisheries and Food if he will make a statement on the takeover bids for S. and W. Berisford and the likely effect on British sugar beet growers.

Photo of John Gummer John Gummer Minister of State (Ministry of Agriculture, Fisheries and Food)

My right hon. Friend the Secretary of State for Trade and Industry announced on 20 May that he had decided to refer to the Monopolies and Mergers Commission proposed acquisitions of S. and W. Berisford by Hillsdown Holdings and Tate and Lyle in accordance with the recommendation of the Director General of Fair Trading. The commission's investigations will include consideration of the likely effect on British sugar beet growers.

Photo of Mr Richard Livsey Mr Richard Livsey , Brecon and Radnor

While welcoming the fact that the proposed acquisition has been referred to the Monopolies and Mergers Commission, may I ask whether the Minister agrees that the sugar industry is far too important to be the subject of such a takeover? Would it not be in the best interests of the industry if it rescued itself, and also for a management buy-out to be considered as the best possible solution for sugar beet growers and those who work in the industry?

Photo of John Gummer John Gummer Minister of State (Ministry of Agriculture, Fisheries and Food)

I do not think that the series of parts in the hon. Gentleman's supplementary hang together. It is necessary that we look at the effect of any purchase in the context of the interests of the country as a whole, and especially those concerned in the sugar industry. That is what we are doing.

Photo of Mr William Clark Mr William Clark , Croydon South

Does my right hon. Friend agree that the finance margin for refining beet sugar is much higher than the margin for cane sugar, which is very low? Does he further agree that that could possibly activate against the interests of the ACP countries?

Photo of John Gummer John Gummer Minister of State (Ministry of Agriculture, Fisheries and Food)

I am sure that my hon. Friend is right. The narrowness of the refining margin causes considerable concern, because without a proper refining capacity in this country the ACOP countries would find it impossible to obtain a market for their cane, which would be a disaster. That is why we have been pressing the European Commission to hold a full investigation, and we are pleased that it will now do so.

Photo of Mr Nigel Spearing Mr Nigel Spearing , Newham South

Is it not true that a Monopolies Commission investigation could reveal that, given proper safeguards for monopolies, this acquisition could provide an opportunity for all the interests of beet producers and refiners as well as cane producers in the Commonwealth and cane workers in this country to be combined to provide a stable, domestically-owned sugar industry that would provide employment and markets for all concerned?

Photo of John Gummer John Gummer Minister of State (Ministry of Agriculture, Fisheries and Food)

That is no doubt the case that Tate and Lyle will put before the commission. However, there are now two investigations — one by the Monopolies and Mergers Commission and the other by the European Commission, which is looking into the margin.

Mr. Andy Stewart:

Will my right hon. Friend reassure my constituents and others who grow sugar beet that if Ferruzzi, the Italian company, makes a further bid he will support his colleagues by referring that to the Monopolies and Mergers Commission also?

Photo of John Gummer John Gummer Minister of State (Ministry of Agriculture, Fisheries and Food)

The Office of Fair Trading is currently considering whether Ferruzzi's holding in Berisford constitutes a material influence resulting in a merger that would qualify, at the moment, for a reference to the Monopolies and Mergers Commission under the Fair Trading Act 1973.

Photo of Mr Thomas Torney Mr Thomas Torney , Bradford South

Is the hon. Gentleman aware that takeovers usually mean unemployment for workers in the company taken over? Will he therefore consider making representations to try to ensure that workers do not lose jobs, especially in view of the tremendous workless total in this country?

Photo of John Gummer John Gummer Minister of State (Ministry of Agriculture, Fisheries and Food)

In the first place, I do not think that is truthful. One must look for security of employment in an industry, and that security is sometimes advanced by takeovers and sometimes not. The hon. Gentleman must not let his political dogma get in the way of the facts. We must adopt the best possible solution across the board, and that is why we have established an impartial. investigation. The hon. Gentleman wants to prejudge the impartial investigation, which is a typical Socialist attitude.