Part of Motor Trade (Consumer Protection) Bill – in the House of Commons at 6:26 pm on 6th February 1990.

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Photo of Mr Geraint Howells Mr Geraint Howells , Ceredigion and Pembroke North 6:26 pm, 6th February 1990

British agriculture is facing a major financial crisis, which is one of the worst since the war. As a part-time farmer, I am pleased that you have called me so early in this important debate, Mr. Deputy Speaker. The situation is so serious that we have gone beyond attempting to make a political point today; instead, we are trying to persuade the Minister to do his utmost on our behalf. Many of the leaders of our great agricultural sector are keeping a watchful eye on us this afternoon and listening to our contributions. They have come here to urge Members to Parliament to bring pressure to bear on the Minister, so that he in turn can go to his counterparts in Europe and persuade them that they must listen to and heed what our Minister of Agriculture, Fisheries and Food is saying on behalf of British agriculture.

The Minister can be in no doubt today about the message that he must carry to Brussels on behalf of British farmers and of those hon. Members who believe that agriculture should be rescued from its present state of low morale. Real farm incomes have been falling steadily over the past few years. Farmers are suffering badly, as are many other business people, from the Government's policy of maintaining cripplingly high interest rates. It has been calculated that in 1989, the interest bill paid by farmers rose by about £250 million, a staggering rise of 37 per cent. Not surprisingly, investment in farming is falling. Over the five years to 1988, annual investment in fixed capital was down by 40 per cent. which shows clearly that resources are just not available.

I had the privilege this morning of having breakfast with one of Britain's major cereal growers. He said that he had not made a penny profit for the last two years and, worst of all, had not been able to invest in new machinery. He said that, unless something came his way within the next two years, he would have a major problem on his hands in regard to investing in machinery.

I know that the Minister is not in a position to bring down high interest rates at present, but I am sure that, on behalf of everyone in the industry, he will urge the But what makes life even more difficult and heightens the sense of injustice in the industry is the spectre of the green pound that hovers over us, completely distorting the market, making support prices in Britain lower than those of all other member states of the EC apart from Spain and Greece. Can anyone honestly agree that it is fair to maintain a system that taxes our exports and at the same time gives a subsidy, through MCAs, to imports into this country?

A Scottish farmer who is a correspondent of mine writes: It is absolutely crazy to be subsidising Irish beef into this country and charging the same equivalent on our exports through the MCAs". He points out that, in his area in the north of Scotland, local producers are getting £120 per head on average, less than in November 1989, and he reports that one of the bigger fatteners in that area is looking at a loss of £70,000 on his buying bill since autumn 1989. That will obviously have a knock-on effect on hill-weaned calf sales this autumn.

Areas such as Scotland and Wales, where the industry is mainly concentrated on livestock, are particularly at a disadvantage, and it is that sector that the Minister must move to protect. It is essential for the future of our rural areas that a satisfactory level of farm income is maintained.

I have received many letters, like all my colleagues from Scotland, England and Wales, about the plight of the industry at the present time; we can only pass that view on to the Minister in the hope that he will take heed of the requests of all farmers in Britain.