I am pleased to be able to contribute briefly to this wide-ranging debate as the representative of a rural constituency with a very important milk sector. Naturally, I reflect the fact that that part of the industry, which has now settled down to quotas, is probably more profitable and settled than other parts.
I very much welcome the fact that the Minister may be looking at the prospect of loaning some percentage quota to young entrants to the agricultural industry. The great problem, however, is in defining a new entrant. No farmer or producer in my constituency would want to see an incentive given to some yuppie farmer or somebody who has sold a business and is investing as a new entrant to agriculture.
All hon. Members present who represent rural constituencies will agree with me that the agriculture industry as a whole is the backbone of the rural economy and that farmers are the only true custodians of the countryside—a countryside which is admired, enjoyed and appreciated by vast numbers of British people and tourists and which has virtually been created by the farming community with its good husbandry over the years.
The industry has always responded to incentives provided by central Government and indeed, the EC. In these difficult days, when there is overproduction of food, it will respond with equal vigour to the emerging priority to get supply and demand into better balance and to focus on the marketplace in meeting change and the requirements of the consumer.
It should be said that there is no great divide between the farmer and the consumer. Farmers are consumers and so are their families; they shop in the same supermarkets and corner shops as the rest of us.
There is today an excellent range of home-produced food—helping, incidentally, our balance of payments—at modest prices. Let us not forget that the return to the producer is a small part of the cost in the shops, most of which is made up by processing, packaging and transportation costs. But it is equally true that the industry faces a severe crisis of confidence in its future, with average farming incomes dropping by about 9 per cent. each year, extremely low profitability and, as a result, very low investment. These problems are further exacerbated by the high interest rates which are being used as the sole weapon in the fight against inflation.
The theme that has run through the many and varied contributions to the debate is that the current green pound gap must be eliminated. It is a discriminatory currency mechanism and, in the best interests of Britain and its farming community, must be removed, and as a matter of urgency. Indeed, 1992 is so far ahead that some farming businesses will not last until then, and the Commission proposal of an initial reduction of one third is totally unacceptable. Of course we all realise that the Minister will be batting against 11 European Agriculture Ministers, who have a vested interest in retaining the green pound disadvantage to this country. I hope that the Minister will take away from the debate a message from both sides of the House, distilled into the simple call that this country demands fair play and action now—nothing less than the total removal of the green pound gap will do.
Agriculture needs to be profitable, to reinvest to face the challenges and opportunities of the 1990s and to be competitive. It has never turned its face away from a challenge but it cannot compete with one hand and one leg tied behind its back. The Minister should be in no doubt that the industry's future depends on the forthcoming negotiations; much is at stake and everyone who is involved with or concerned for this country's rural environment will wish him well in those negotiations.