Agriculture

Part of Motor Trade (Consumer Protection) Bill – in the House of Commons at 8:54 pm on 6 February 1990.

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Photo of Mr Andrew Stewart Mr Andrew Stewart , Sherwood 8:54, 6 February 1990

Before we had the Green party, we had the green pound. The public could be forgiven for thinking that it was an environmental tax. It is certainly a tax, not to protect the environment, but on Britain's super-efficient farmers and it now amounts to about £650 million. That green tax, or pound, was created to protect farmers in other EC countries from fair competition. British farmers cannot afford to be indifferent to this injustice. There comes a time when we must say that enough is enough, and that time is now.

Why should we have an artificially overvalued rate of exchange? When sterling falls against other European currencies, the green pound gap widens. For other British industries, that fall in value protects their trading position. The price of competing imports rises and British exports become more competitive on foreign markets. Why should those benefits be denied to United Kingdom farmers? To prevent the benefits coming through, the green currency system is underpinned by monetary compensatory amounts. The MCAs tax our exports of agricultural produce and subsidise competing imports. There has been talk today of a level playing field. I should prefer to see the goal posts remaining in one position.

The reality of the green pound gaps for farmers is lower prices. That was reflected in farm incomes in 1988 reaching their lowest point in any post-war period and they have fallen to a point that even a certain lager cannot reach. I accept that supply and demand for agricultural commodities will be guided increasingly by the market, and the European Commission's tight policies on the CAP support prices are consistent with that approach. However, our top priority at this year's price fixing in Brussels must be to secure fair competition in Europe for British farmers. The European Commission proposes a 33 per cent. devaluation of the green pound whereas my right hon. Friend the Minister wants a 50 per cent. cut.

We British farmers not only propose but demand in the name of justice a full devaluation of the green pound. The farming industry cannot wait until 1992 for that distortion of competition to be removed.