Orders of the Day — Potato Marketing Scheme

– in the House of Commons at 9:46 pm on 17th January 1996.

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Photo of Tim Boswell Tim Boswell Parliamentary Secretary (Ministry of Agriculture, Fisheries and Food) 9:46 pm, 17th January 1996

I beg to move, That the draft Potato Marketing Scheme (Commencement of Revocation Period) Order 1995, which was laid before this House on 12th December, be approved. The draft order is presented in accordance with the requirements of the Agriculture Act 1993. Its purpose is to specify the date 12 months from which the potato marketing scheme will be revoked. The order is straightforward, therefore, but at the time of the debates on the Agriculture Bill in 1993 concerns were expressed about the future of the scheme. I will attempt to show that those concerns are now both misplaced and out of date.

I shall begin by briefly reminding the House of the background. The 1993 Act gave Ministers power to revoke the potato marketing scheme should they consider it necessary or in the public interest. In debate on the Act, which aroused considerable interest both here and in another place, Ministers made it clear that no decision had been made as to revocation of the scheme. Indeed, the then Minister, now Secretary of State for Education and Employment—my right hon. Friend the Member for South-West Norfolk (Mrs. Shephard), whom we are pleased to welcome to the Front Bench tonight—made it clear that she wished to consider all the arguments at first hand before coming to any decision. That she did, with considerable care. As a result, she made the definitive announcement in November 1993 that, on both trading and deregulatory grounds, the scheme must come to an end. In that, she was echoing the recommendations of the House of Lords Select Committee on the European Communities which, when examining the Commission's proposal for a common organisation of the market in potatoes, concluded that, even if there were no agreements on such a regime, Britain should not continue to impose unilateral market controls.

That Committee believed, as the Government now believe, that Britain would be better able to compete in Europe without the constraints of the potato marketing scheme.

Photo of Mr James Pawsey Mr James Pawsey , Rugby and Kenilworth

Will my hon. Friend confirm for the benefit of farmers in my constituency that British and European farmers will operate on a level playing field without benefit to our European competitors?

Photo of Tim Boswell Tim Boswell Parliamentary Secretary (Ministry of Agriculture, Fisheries and Food)

I am grateful to my hon. Friend for raising that point. We seek a level playing field for our farmers in this as in other respects. I shall explain to the House in a moment the nature of the present provisions and the advantages of a lightweight regime in effecting that.

Indeed, there is a suggestion that my hon. Friend has reiterated that a link should be forged between agreement on a potato regime and revocation of the scheme. I intend to show that such a linkage is not only invalid, but would be damaging to our interests. As that is an important point, I shall explain it in a few moments.

Returning to the history of the matter, in announcing the intention to revoke the scheme—in 1993, as the House will recall—the Government recognised the need that was expressed within and outside the industry for it to have time to adapt to the conditions of the free market. The scheme was therefore allowed to continue in a modified form for three years. The modifications were based on suggestions by the Potato Marketing Board and the National Farmers Union. I shall not go into detail as to the modifications. Suffice it to say that they all led towards loosening the quota controls operated by the board, removal of intervention buying and reducing the administration costs of the scheme.

The industry has made excellent use of the intervening period. All the modifications requested by Ministers were speedily introduced and so much progress has been made towards the free market that the board has already decided that it will not operate quota controls this year. That means that there will be a de facto free market in 1996—a full year before the scheme is revoked. That is evidence of an adapting and forward-looking industry of which the free market need have no fears.

We have now completed all the necessary preliminaries to laying the draft order. They included consultation of representatives of producers, purchasers, retailers and consumers of potatoes as required by section 25(3) of the 1993 Act.

The draft order simply specifies 1 July 1996 as the first day of the 12-month period, at the end of which the potato marketing scheme will be revoked. That means that the scheme itself will come to an end on 30 June 1997. The reason for selecting the June date is not arbitrary; it marks the end of the potato marketing year and is therefore the most convenient transition date for all concerned.

Photo of Paddy Tipping Paddy Tipping , Sherwood

Will the Minister confirm that that is the earliest date to wind up the scheme and that he has the power to extend the scheme if necessary? Will he use that power if he is not confident that there is a level playing field across Europe?

Photo of Tim Boswell Tim Boswell Parliamentary Secretary (Ministry of Agriculture, Fisheries and Food)

I shall explain to the House why it would be positively inimical to the interests of growers to continue with a scheme that is past its sell-by date, which is bureaucratic and which shackles the ability of the industry to respond to the new, free market conditions. I advise the House to accept the link between those two terms.

Photo of Mr Paul Marland Mr Paul Marland , Gloucestershire West

Will my hon. Friend explain to the House what mechanism will be in place to ensure that our European partners do not favour their own industries with domestic assistance? I do not know whether it is just the potato growers in the Forest of Dean, but I suspect that throughout Gloucestershire—and I see that my hon. Friend the Member for Cirencester and Tewkesbury (Mr. Clifton-Brown) feels the same—there is considerable suspicion among potato farmers that other Governments may not treat the matter in the same way as we do. Burnt into our memories is the fact that when the French decided to take on the British turkey industry, the turkey processors were awarded a grant of 120 per cent. to build a turkey processing plant in Brittany in breach of the rules and regulations. Can my hon. Friend reassure the potato growers in Gloucestershire?

Photo of Tim Boswell Tim Boswell Parliamentary Secretary (Ministry of Agriculture, Fisheries and Food)

I can tell my hon. Friend, who is much respected in agricultural circles, that there is widespread concern on exactly that point. It is the clear wish of producers that there should be, as far as humanly possible, a level playing field. In recent years, producers have done quite well—as is shown by their export performance—within the existing system, where there is no common organisation of the market. To effect the competition rules against state aids—my hon. Friend will be aware that those rules operate only where state aids distort competition, not automatically—it would be necessary to specify that in some common organisation of the market. That is a clear interest in having a so-called lightweight regime, to which I shall return. I thought it sensible to take time to explain that point, because of the concern felt by many hon. Members on both sides of the House.

Within six months of the order's commencement date, section 27(1) of the 1993 Act requires the board to apply to the Agriculture Ministers for approval of a scheme to transfer its property, rights and liabilities to a successor body or bodies—unless growers, in a poll, tell it not to do so. The 1993 Act was framed specifically to allow for a successor, so that the desirable activities of the board—I emphasise that they are desirable activities—in research, promotion and information on behalf of the industry could continue. The Act allows for one of three different types of successor—a development council, registered company or friendly society. Our consultation revealed widespread support in the industry for a body funded by levy to succeed the board, which means in effect a development council.

The House will be interested and, I hope, encouraged to know that not only has the industry agreed on the necessity for a levy-funded successor body to the board but all sectors of the industry have reached consensus on the form that such a body should take. I am not in a position to comment today on the detail of the industry's proposals, as it will be for the board to present proposals to Ministers for approval at the appropriate time, if growers wish.

Photo of Mr David Harris Mr David Harris , St Ives

Can my hon. Friend assure the House that any body established on the levy principle will be answerable not just to the Minister but primarily to the growers, as the payers of the levy?

Photo of Tim Boswell Tim Boswell Parliamentary Secretary (Ministry of Agriculture, Fisheries and Food)

I understand my hon. Friend's feelings. Appointments to a development council, particularly in the new climate set by the Nolan committee, cannot be in any sense dictated in advance, but are the responsibility of Ministers taking advice. There can be no narrow constituency that automatically entitles one particular group of interests to a seat on the board. If my hon. Friend considers the experience of existing development councils, although occasionally they are not without their critics, they broadly represent the interests of those concerned in the industry. I am sensitive to my hon. Friend's point and hope that he will be sensitive to the constitutional propriety that I described.

The House will appreciate that details of the successor body are not yet available, but the fact that consensus on such a body exists is another testimony to the potato industry's progressive attitude.

I return to the linkage of the revocation of our scheme with agreement on a common agricultural policy regime for potatoes. The Government are well aware of and sensitive to widespread concern within the industry that a lightweight European Union regime for potatoes should be introduced as soon as possible, to remove national aids currently operating in other member states. The UK has been the only member state that has consistently supported the European Commission's proposals for just such a regime.

Photo of Mr George Stevenson Mr George Stevenson , Stoke-on-Trent South

Will the Minister confirm that there is not an EU potato regime and that any such regime that may be established, no matter how lightweight, will cost a considerable amount of money?

Photo of Tim Boswell Tim Boswell Parliamentary Secretary (Ministry of Agriculture, Fisheries and Food)

I can tell the hon. Gentleman immediately, if he is in any doubt, that there is not an EU potato regime. I do not agree with him about cost. We do not wish to involve ourselves in a regime that is inordinately expensive. One of the concerns expressed by hon. Members on both sides of the House has been the high costs of the withdrawal and intervention system in the separate area of fruit and vegetables. That is exactly what we do not want. Nor do we want to tip the discussion into a mode where we end up having it against our will. We would resist that firmly. That is why we have been consistent supporters of the Commission's proposals for a regime.

Photo of Tim Boswell Tim Boswell Parliamentary Secretary (Ministry of Agriculture, Fisheries and Food)

I am sure that it is nice occasionally to be on the side of the Commission.

My right hon. and learned Friend the Minister pressed the Spanish—

Photo of John Home Robertson John Home Robertson , East Lothian

Will the Minister confirm that he is winding up a scheme which is costing the taxpayer nothing, or next to nothing, and calling for the introduction of a European scheme that is likely to cost something quite significant?

Photo of Tim Boswell Tim Boswell Parliamentary Secretary (Ministry of Agriculture, Fisheries and Food)

I cannot accept what the hon. Gentleman says about the likely cost of the European scheme. The purpose of a lightweight regime is primarily to safeguard our position on unfair and distorted competition through national aids. That is what we conceive as the main objective. The costs, if any, would be cast with that objective in view.

Photo of Mr Dale Campbell-Savours Mr Dale Campbell-Savours , Workington

If it is, as the Minister says, that Britain is the only country in the Community that is prepared to accept the Commission's proposals and he does not want a regime that will cost money while all the other states clearly do, on what basis can he possibly say that when the present scheme is ended at the beginning of July, he will be able to deliver his undertakings?

Photo of Tim Boswell Tim Boswell Parliamentary Secretary (Ministry of Agriculture, Fisheries and Food)

The hon. Gentleman, in his anxiety to interrupt me, has jumped to the wrong conclusion. It is by no means the case that other member states want a heavyweight regime with the full works of intervention, or whatever. There are many member states that do not want a regime. We are interested in and prepared to support one. As I have already said, British potato growers have been doing very well. We are confident that they will do even better when the board is not round their necks.

Photo of Peter Tapsell Peter Tapsell , Linsey East

Is not the reality that it is most unlikely that we shall be able to negotiate a potato regime with the other members of the EU? It suits them well to intervene nationally to help their potato growers. The great merit of our Potato Marketing Board in the past has been that it has kept supply and demand reasonably in balance without imposing any costs on the British taxpayer. What will happen to the British potato grower the next time we have a glut of potatoes in Britain and in the rest of Europe, when all the European Governments will be subsidising their growers and we will not be helping ours?

Photo of Tim Boswell Tim Boswell Parliamentary Secretary (Ministry of Agriculture, Fisheries and Food)

With great respect, I do not accept that the practice of subsidising potato growers is by any means universal in the Community among other member states. I understand the concern that my hon. Friend expressed so eloquently during the passage of previous legislation, when he advocated a control system with quotas and the maintenance of the familiar system of the Potato Marketing Board, even though it is in abeyance for this year. Our view, from the experience of member states that do not have such a regime and quota control, and from the experience of British growers who have been able to export competitively into Europe, is that whether or not we achieve a lightweight regime, it would still be justified to wind up the board, which is the expectation of the industry, and the Potato Marketing Board is anxious to make progress to pave the way for the establishment of a successor body.

Photo of Tim Boswell Tim Boswell Parliamentary Secretary (Ministry of Agriculture, Fisheries and Food)

I have given way many times. Hon. Members may make their speeches in a moment.

Photo of Henry Bellingham Henry Bellingham , North West Norfolk

I am grateful to my hon. Friend, as I know that he has nearly finished. One point that he has not touched on, however, is the cost of winding up the board. He will be aware that there are producer assets with the board and they may well be used entirely on redundancies, property, pensions and so on. Will he please comment on that important point?

Photo of Tim Boswell Tim Boswell Parliamentary Secretary (Ministry of Agriculture, Fisheries and Food)

I am aware of the overall situation. There is little indication that the overall liabilities of the board under winding-up procedures are likely to exceed its assets. It is likely to be positive and there are, of course, provisions in any winding-up scheme to deal with the situation if there is no transition to a successor body. To introduce the principle of Government subsidy for winding-up costs would be a difficult precedent. It was not adopted, for example, in relation to the milk marketing scheme, nor would it be justified in principle, however seductively my hon. Friend makes the point, because it is claimed that the board has been run as a producer organisation, and although there have been safeguards for consumers, the board has been for the benefit of producers over the years, and they have incurred some responsibilities as well as benefits. We think that they should meet those obligations, and I have every reason to think that that will be possible.

Photo of Mr Christopher Gill Mr Christopher Gill , Ludlow

I am sure that my hon. Friend will concede that the board is being wound up at the behest of Government. Surely there is some moral obligation, therefore, on the Government to fund these costs, as the board could not possibly have forecast them when it was making its future plans all those years ago.

Photo of Tim Boswell Tim Boswell Parliamentary Secretary (Ministry of Agriculture, Fisheries and Food)

I think that my hon. Friend will he able to share with me some of the memories of the early years of the board. I am looking back to the end of de-control some 40 years ago. I am not sure that that is particularly helpful to the present case. I am saying that I do not believe that it is right to use taxpayers' money to add to the assets of the board on its winding up when we have not been prepared to do that for other marketing schemes.

We do not believe that there is any justification for further delay in taking the final steps towards a free market. Our side of the contribution is the revocation of the scheme. For its part, the board has worked very hard with other organisations in the industry to ensure that it is in a position to submit proposals for a successor by the end of this year. In fact, it wishes to put its proposals to growers during the next few weeks. It will be greatly assisted in that process by the fact that the necessary order has been approved. Therefore, I commend the order to the House.

Photo of Mrs Llin Golding Mrs Llin Golding , Newcastle-under-Lyme 10:07 pm, 17th January 1996

I did not realise that there were so many jokes about potatoes until earlier this evening. As hon. Members went past, we heard, "That lot over there get their chips", "The Minister is in a soup", "Boil them in oil!" and similar jokes.

Photo of John Home Robertson John Home Robertson , East Lothian

That is the lightweight regime.

Photo of Mrs Llin Golding Mrs Llin Golding , Newcastle-under-Lyme

That is right. I must say that the jokes were very repetitive, and I shall not repeat all of them.

Photo of Mr James Pawsey Mr James Pawsey , Rugby and Kenilworth

There was the one about stakeholder and chips.

Photo of Mrs Llin Golding Mrs Llin Golding , Newcastle-under-Lyme

Hon. Members missed that one.

Tonight we are talking seriously about potatoes. If there is one thing that Ministers should understand, it is the anxiety that is caused by occupational uncertainty and insecurity. The Government have, of course, brought their own troubles on themselves and deserve the retribution that they will undoubtedly face. Unfortunately, they have also blighted the lives of so many others who deserve better, including the blameless potato growers. In abolishing the very successful potato marketing scheme while neglecting to meet the legitimate needs of growers in other respects, the Government have once again put ideology before the welfare of people who want only to do a useful job for the country—[Interruption.]—unlike Conservative Members who are interrupting.

The Government's case against the potato marketing scheme was put during proceedings on the Agriculture Bill 1993. I do not intend to plough that field again; suffice it to say that the scheme was supported strongly by farmers in a ballot. They considered that it not only provided Britain with a steady supply of good-quality potatoes, but gave growers fair incomes at no cost to the taxpayer.

Photo of Mr George Stevenson Mr George Stevenson , Stoke-on-Trent South

In his perambulation around the issue, the Minister failed to mention the impact on prices for the consumer. He did mention the deregulation of the milk marketing arrangements, which resulted in significant price increases. I believe that increases will be inevitable when the Potato Marketing Board is disbanded. Would my hon. Friend care to comment on the Minister's omission?

Photo of Mrs Llin Golding Mrs Llin Golding , Newcastle-under-Lyme

Nowadays, the Government are not interested in the cost to the consumer and the taxpayer.

Photo of Tim Boswell Tim Boswell Parliamentary Secretary (Ministry of Agriculture, Fisheries and Food)

I welcome the hon. Lady to her first debate speaking from the Front Bench. Why does she expect the lifting of a quota regime, and the concomitant increase in flexibility and freedom of supply, to lead to an overall rise in prices?

Photo of Mrs Llin Golding Mrs Llin Golding , Newcastle-under-Lyme

That is what the Minister said about the Milk Marketing Board. Yesterday, people in Birmingham expressed a very different view. The Potato Processors Association takes a more optimistic view of the abolition of the scheme, but it does not appear to have as much at risk as the growers.

The argument this evening relates chiefly to time, and to the Government's lackadaisical attitude. It is about not ideology, but incompetence and a lack of effort. The Minister will be aware of the excellent, practical, pragmatic brief sent to hon. Members by the National Farmers Union in London and the Scottish NFU. Their argument, in a nutshell, is that the Government should not destroy what we have until they have something to put in its place. It is a sensible and reasonable petition.

The growers have done everything possible to save the situation themselves. As the Minister is well aware, the NFU has said: During the last two years, the Potato Marketing Board has, with the support of growers and the NFU, laid aside its quota and intervention arrangements, reduced its staff and board numbers, welcomed further industry wide involvement, and cut by half its levy on growers". The NFU has bent over backwards to give Ministers what they wanted—the removal of quotas, a year earlier than the Minister wanted, as he has admitted; an increase in planting thresholds; the end of intervention buying; a reduction in the levy to a level appropriate for the funding of the board's other activities, such as research, promotion and the provision of market information; a reduction in the board's membership; and the ending of licensing and registration of potato merchants. Unfortunately, the Government have failed to match its efforts.

The growers would have liked to keep the potato marketing scheme—hence the ballot. At the very least, they want a reasonable alternative. As they see it, the Government have severely constrained the industry's choice of replacement arrangements while making no progress towards a free and fair European market.

As the House knows, the Agriculture Act 1993 provides three possible options. The first is a development council based in statute, which could impose a compulsory levy; the second is a friendly society; and the third is a company. When he announced the results of his consultation just before Christmas, the Minister stated that there was widespread support for an industry body, which would be funded by a strategy levy, to succeed the Potato Marketing Board, and he said that it would be for the board to develop appropriate proposals if that was what growers wanted. That is what growers want.

The NFU insists on the need for a compulsory levy, for which only the first option provides. It also wants those who pay the levy to have control, but apparently that is being resisted by officials. Will the Minister give a clear answer to the growers' question? Can they have a compulsory levy over which they have control?

The NFU is also concerned about the European dimension, as are some others. The Government have sunk the lifeboat that was provided for 60 years by the potato marketing scheme. What are they doing to ensure that growers are thrown the lifebelt of a lightweight EU potato regime? The impression given by the Government is that, far from running for the lifebelt, they have neither the wit nor the will to do anything other than watch the growers go under. They have long since forgotten the fine words in Standing Committee when the then Minister of Agriculture, Fisheries and Food, the right hon. Member for Suffolk, Coastal (Mr. Gummer), now the Secretary of State for the Environment, uttered sentiments and said that no sensible Government would stand aside and say, "Let the Dutch take over," or, "Let the French subsidise their industry into defeating ours." He also said that he wanted to get rid of other countries' support for their potato organisations. Those are fine words.

Photo of Mr Paul Marland Mr Paul Marland , Gloucestershire West

It is a terrible indictment of British potato growers by the Opposition Front-Bench spokesman to say that, as a result of this measure, British potato growers will go under and that the entire needs of British potato eaters will be imported from Holland. Does she really mean that?

Photo of Gwyneth Dunwoody Gwyneth Dunwoody , Crewe and Nantwich

That is not what my hon. Friend said.

Photo of Mr Paul Marland Mr Paul Marland , Gloucestershire West

That is indeed what the hon. Member for Newcastle-under-Lyme (Mrs. Golding) said. Does she believe that British potato growers are so gutless and uninventive that they will stand back and watch the Dutch potato growers swamp the market? Potato growers throughout the UK should understand exactly what the hon. Lady says about them.

Photo of Mrs Llin Golding Mrs Llin Golding , Newcastle-under-Lyme

It is nice to listen to the hon. Gentleman and to know that, in addition to Opposition Members, a Conservative Member wishes to support potato growers. [Interruption.] The hon. Gentleman should listen to what I have to say. I assure him that we are committed to supporting potato growers and we want to ensure that they have fair competition. The hon. Gentleman, of all people, should understand that.

As I have said, the right hon. Member for Suffolk, Coastal used fine words in Committee, but the NFU says that foreign growers are supported. There is support in surplus seasons to retain productive capacity; support for processing facilities, production and research; and support for exports to the British home and export markets. The Government appear to be doing nothing about that, and that is one of the matters on which I take issue with the Minister. It is not the Minister but we who are pressing the Government to do something.

To stop other Governments undermining our growers, the growers are asking for those common rules of competition that an EU lightweight scheme would provide, and they seek a scheme that would avoid the market support regime, with the highly expensive policy of intervention buying that is wanted by some countries. The NFU believes that the Minister should undertake that, in good time before the scheme is revoked he will make a statement to the House, supported by a written report, indicating

  1. 1. The action which the UK Government has taken to secure common rules of competition in the European Potato Market, and particularly whether or not there will be a lightweight regime in place by 30 June 1997.
  2. 2. The results of a UK investigation into the state of competition in the European potato market at that time, including all available information on EU Member State aids.
  3. 3. The measures that the Minister proposes to take which will ensure that the GB potato industry can compete on even terms in the European market after June 1997."

Hon. Members:

Not to him.

Photo of Mr Bill Walker Mr Bill Walker , North Tayside

Opposition Members will know that my constituency has a large potato growing area.

Photo of John Home Robertson John Home Robertson , East Lothian

It is represented by one.

Photo of Mr Bill Walker Mr Bill Walker , North Tayside

I listen to the laird with great interest. As an ordinary working-class chap, I am always fascinated by what he says.

Will the hon. Lady tell the House how a Labour Government, if we ever have one, would ensure that all her proposals would be forced through the European Union—how that would be achieved? We would be interested to know how the Opposition would deal with qualified majority voting.

Photo of Mrs Llin Golding Mrs Llin Golding , Newcastle-under-Lyme

This is, of course, a typical question. When Conservative Members are in a mess, have got rid of something that they know works, and do not know what to put in its place, they ask the Opposition what they would do.

The NFU says: If other European producers are still in a position to receive national support GB producers will expect equivalent support. It would be helpful if the Minister responded to the NFU position and to one other important point included in the NFU brief. It states: the PMB is being wound up purely as a result of UK Government policy. Remember the ballot. It goes on: The majority of producer assets in the PMB are likely to be spent in meeting the wind-up costs in relation to property, redundancies and pensions. We seek a commitment from the Minister that the Government will meet a significant proportion of the costs of winding up the Board.

Photo of Tim Boswell Tim Boswell Parliamentary Secretary (Ministry of Agriculture, Fisheries and Food)

Is that a spending pledge? If so, has it been cleared with the hon. Member for Dunfermline, East (Mr. Brown)?

Photo of Mrs Llin Golding Mrs Llin Golding , Newcastle-under-Lyme

Another Minister is looking for the Opposition to get him out of a mess. He should never have got rid of the board. If he had abided by the NFU's ballot, he would not have done so.

Photo of Mrs Llin Golding Mrs Llin Golding , Newcastle-under-Lyme

That is the answer.

To express again our strong support for potato growers, and yet again to register our complete dissatisfaction with the Government and their incompetence, I ask my right hon. and hon. Friends to vote against the order.

Photo of Roger Gale Roger Gale , North Thanet 10:23 pm, 17th January 1996

Since I have been in the House, I have sought to represent the interests of potato growers in my constituency of North Thanet. One of the most contentious things that I am likely to say tonight is that they grow the finest potatoes in the United Kingdom and, probably, in Europe. I appreciate that my hon. Friend the Member for St. Ives (Mr. Harris) and hon. Friends representing the Forest of Dean, seats in Norfolk and elsewhere might find that difficult to comprehend, but we in Thanet have significant potato growers of first early and main crop potatoes.

When I first arrived in Thanet, I was most compelled by growers' concern about the damage that the Potato Marketing Board and the regime were doing to their business. They cited two counts—first, that they were subjected to quotas, and secondly, that they were subjected to a levy. The quotas were especially damaging to the crops of first early growers, who faced ludicrous competition, especially from the French growers who did not have quotas and were dumping potatoes willy-nilly in the United Kingdom. Buyers in Covent Garden were sending back locally grown and excellent potatoes on quality grounds simply because they had already committed themselves to, and had to pay for, overseas products. The businesses also found the levy intolerable. They could not understand why a Conservative Government were allowing the continuation of a regime that placed such controls upon them.

One of the first things that I had to do as the newly elected parliamentary representative was to prevail upon my colleagues in the Ministry to abolish the potato marketing regime. I am absolutely delighted that tonight we are witnessing the dying throes of a regime that placed ludicrous controls on some of the finest potato growers in the world.

At that time, the growth in the potato consumption market was, as it is now, almost exclusively in processed potatoes. Then, as now, the housewife did not wish to peel spuds. I took the trouble—which I doubt Labour Members have done—to visit the potato processing plants being established throughout Holland and northern France, where processors knew that they had access to good, reliable, cheap and abundant crops. That investment was made on the European mainland rather than in the United Kingdom, largely because of the restrictions imposed upon our growers by the Potato Marketing Board.

The growth in the potato consumption market is still in processed potatoes. Thank heavens that there is at last investment in potato processing plant in the United Kingdom. It is creating jobs. The processing business is now aware that it can rely on an unregulated crop, free of quotas, from the United Kingdom. I regard that as progress. I am sad that no Labour Member—or, indeed any of my hon. Friends—has mentioned that point.

Photo of Ann Winterton Ann Winterton , Congleton

I am grateful to my hon. Friend for giving way. I shall be brief. When he went to inspect the Dutch processing industry, did he ascertain whether it received any state aid?

Photo of Roger Gale Roger Gale , North Thanet

I was about to deal with precisely that point. We want a level playing field. [HON. MEMBERS: "Ah!"] Labour Members moan and groan, but their Front-Bench spokesman made a plea for state subsidy—[HON. MEMBERS: "No."] Yes. The hon. Member for Newcastle-under-Lyme (Mrs. Golding) said that other countries were subsidising plant and crops and pleaded for some of that for Britain. [HON. MEMBERS: "No."] Yes, she did. I want none of that. [Interruption.] I wish Labour Members would listen.

I did not stand here 10 years ago and I do not stand here tonight arguing for deregulation of the United Kingdom market, solely to see the imposition of regulation and subsidy in Holland and France, just 20 miles across the channel from my constituency. I agree with my hon. Friend the Minister's view of the need for a light European Union regime. Subsidy is outside European regulation—it is not permitted, nor should it be. I simply want to know that the Government will take a robust view of any hint of any kind of subsidy to our competitors on the European mainland. Having deregulated the industry in this country, having freed up our farmers to create the crop that we need, having seen the investment in plant that we wanted, I do not expect that plant to be supplied by cheap, subsidised products from either France or Holland.

Photo of Roger Gale Roger Gale , North Thanet

No, I will not give way. Stick to soup.

The signs are that the regime will be succeeded by a development council funded by a levy on producers. That is what the producers in my constituency want. Indeed, my constituent Richard Ash made that point to me only yesterday. The producers are paying the fiddler and they wish to call the tune. They want that development council to he answerable to them, the farmers, not simply to Ministers. Can we have that assurance?

I have listened carefully to the arguments concerning wind-up costs and money that may be left over from the Potato Marketing Board. I do not expect pensioners in North Thanet as taxpayers, any more than I expect pensioners anywhere else in the United Kingdom, to subsidise the wind-up costs of the Potato Marketing Board. My hon. Friend the Minister has said that there is likely to be surplus money after the wind-up costs have been paid. If that is so, will he assure me that that money will be paid directly to the development council to help it launch its work?

Photo of Nick Ainger Nick Ainger , Pembroke 10:30 pm, 17th January 1996

I speak as a Member who represents a new potato growing area in Pembrokeshire that rightly has an excellent reputation. My growers are telling me, through the National Farmers Union and the Potato Marketing Board, that the commitments that they have been seeking from the Government before winding up the marketing scheme have not been given. That has certainly been confirmed by what the Minister has said tonight.

Absolutely no commitments have been given about a fair and open market in Europe or about the reduction or elimination of state aids to growers in our competitor countries, regardless of whether they are on the Iberian peninsula, or in Italy, France or Greece. All the Minister has been able to tell us is that, on our own, the Government, with the support of the Commission, are in agreement. Every other state, which is subsidising its growers in one form or another, is opposed to the Commission's proposition for a lightweight regime.

The hon. Member for North Thanet (Mr. Gale) could not have been listening to what the Minister was saying, because the latter made it quite clear that there was no way in which he could give any guarantee whatever that, by the time the scheme is wound up, there will be a level playing field—as it is called—or that there will be fair competition and no state aids.

I am concerned because the new potato market is extremely sensitive to competition, especially unfair competition. New potatoes have a very short season. We already have traditional competition from the near east, north Africa and southern states of Europe. There is concern that, if the protection—admittedly, it is only in the form of support by the growers—is removed in a year or two, there will be problems. There have already been problems over the past few years. The winter might be long or the spring wet. Certain problems always arise.

Without protection, and because the Government have failed totally to eliminate unfair competition in Europe, growers will undoubtedly go to the wall. The market is incredibly competitive. All it takes is a wet week or a wet fortnight, and the window for the market of premature new potatoes is lost.

Until the Government can give the growers the assurances they are seeking, which they have certainly failed to give tonight, the growers, through the farming unions and the Potato Marketing Board, will be very disturbed about the fact that the Government are going ahead with the revocation, willy-nilly and irrespective of what is happening in Europe.

The Minister rightly praised the work of the Potato Marketing Board, and its progress since the Agriculture Act 1993. I am sure that Members on both sides have received a letter from the chairman of the Potato Marketing Board highlighting the three commitments it seeks. The first is an assurance that British potato growers will be able to compete on even terms with their EU counterparts after the end of the Scheme". The second commitment that the board seeks is a strong statement that the UK Government will do all in its power to ensure that EU member states are not able to provide state aids to their producers when British growers can not enjoy similar support. This should be achieved preferably by seeking the introduction of a lightweight EU potato regime". The third commitment sought relates to the winding-up costs of the board.

The chairman, whom the Minister has congratulated, says that he believes that, if those commitments are satisfied, British growers can compete satisfactorily in this country and in the export market. He then says that, as long as the commitments are given, the vast majority of potato growers will accept the ending of the scheme and the move to deregulate the market.

However, that acceptance is conditional on the first two commitments in particular being given. As the Minister has absolutely failed even to address those issues properly tonight and has not given any commitments, the Opposition will oppose the revocation.

Photo of Mr David Harris Mr David Harris , St Ives 10:35 pm, 17th January 1996

I represent an area that grows a lot of potatoes, both early potatoes and early main crop potatoes for the crisps industry—crispers, as they are called. Most of that production takes place on a contract basis.

I must confess that when, under the Agriculture Act 1993, we took the first step towards the abolition of the Potato Marketing Board, I expected an outcry from some of my farmers, but not from all of them, because some of the farmers in my constituency have been very much against the workings of the board. However, I thought that those who supported the board—possibly the majority of farmers in my constituency—would be extremely worried.

All I can tell the House is that I have not had a single letter or telephone call. I addressed the Penzance branch of the National Farmers Union just before Christmas, and no one mentioned the factors that have featured in our debate tonight. Like every other hon. Member who has a constituency interest, I have had the documents from the NFU and the Potato Marketing Board that have been quoted. I am not in any way trying to rubbish the points they make. Obviously, there is concern on the part of the NFU and the board. I can report only that individual growers—I have a lot of them in my constituency—have not voiced those concerns to me.

Although, in more recent years, the Potato Marketing Board has come in for some criticism, not least from the constituents of my hon. Friend the Member for North Thanet (Mr. Gale), in whose constituency the campaign against the Potato Marketing Board was centred, it is right to pay tribute to the work done by the board over many years. I know some dedicated people in my constituency, such as Mr. John Badcock, who served on the board for many years. It is only right that we should pay tribute to those people.

I came to the conclusion, however, that the system we had some years ago could not be sustained, for the very reason given by my hon. Friend the Member for North Thanet—that it did not make sense to have a quota system that exposed us to competition, especially in the processed area, from countries that did not have a quota system.

Since the changes were announced in the Agriculture Act 1993, the potato industry has begun to make the necessary changes, and has adapted to the situation. Therefore, I am somewhat reassured. However, I share the fears being expressed on national aids, and when or if evidence is produced—none has been produced so far tonight—that some member states are making unfair use of national aids to distort competition, the Government will have to take action under the competition sections of the treaty, because that power exists.

I am also reassured by my hon. Friend the Minister's comments about the costs of winding up the scheme, because he made it clear that the board is likely to have a surplus to disburse, so there will be no need to go back to the industry for extra money to meet the winding-up costs.

Photo of Tim Boswell Tim Boswell Parliamentary Secretary (Ministry of Agriculture, Fisheries and Food)

May I clarify a point that my hon. Friend has raised, and to which my hon. Friend the Member for North Thanet (Mr. Gale) also referred? The existing board has been making provision for its winding-up costs, and there is a reference in the board's annual report to the position of pension funds under the board. The likelihood is that, if there is a surplus in assets, it will be possible to transfer those under any proposed scheme to a successor body. If that does not happen, funds will be redistributed to the producers.

Photo of Mr David Harris Mr David Harris , St Ives

I am most reassured by that. I wish to re-emphasise a point that I tried to raise in an intervention—that, when a new system is introduced, the growers themselves should be in charge of it. That is a very important point.

I end on a topical issue. Brown rot is a matter of extreme concern to growers, particularly in Cornwall. I ask for an assurance that the Government will maintain their checks for brown rot on seed potatoes coming into this country from Holland. On balance, I would conclude that the House should approve the order.

Photo of Mr Paul Tyler Mr Paul Tyler , North Cornwall 10:41 pm, 17th January 1996

I am glad to follow the hon. Member for St. Ives (Mr. Harris), if only to endorse his point about brown rot, which is extremely serious in our part of the country. The hon. Gentleman was lucky if, in the time he attended the annual meeting of the county branch of the NFU in Truro last Friday, he was not lobbied about the order, because I was. I was at the meeting in the latter part of the day—the hon. Gentleman was there earlier—and the issue came up several times.

The hon. Member for St. Ives has been misled. The issue tonight is not whether we keep the scheme in place but what will replace it and when. That is the question, and I very much hope that the Minister will listen carefully to the wise words of the hon. Member for East Lindsey (Sir P. Tapsell). The hon. Gentleman intervened to say that, if the scheme is swept away without real progress for the regime throughout Europe, our growers will be exposed to a most intolerable situation.

Before I return to that matter, I wish to deal with one or two misconceptions. Some hon. Members may have received a briefing from the Potato Processors Association. I think that the hon. Member for North Thanet (Mr. Gale) quoted from it.

Photo of Roger Gale Roger Gale , North Thanet

Will the hon. Gentleman give way?

Photo of Mr Paul Tyler Mr Paul Tyler , North Cornwall

No, I have very little time, and the hon. Gentleman did not give way during his speech.

The association's briefing states: last season, processors of frozen potato products and par fries increased their usage of potatoes in UK factories by 10 per cent. whilst imports of processed products reduced by 24 per cent. That gives the impression that everything is wonderful, that growers are doing very well and that imports are being cut. But we must recognise the very special climatic conditions that affect this sector of the industry.

In 1993–94—the year before the one referred to in the briefing—there was a poor, wet and cold season, after which the harvest collapsed. In previous years, those latest import figures were nothing like as encouraging as implied by that brief.

It is misleading for hon. Members to be given that impression. I hope that the Minister will not rely on that. It is certainly not true that growers are doing so well that the scheme can be cheerfully dumped. That is the first correction that I want to make.

Photo of Mr Paul Tyler Mr Paul Tyler , North Cornwall

The Minister will have a chance to reply to the debate. I want to be as brief as possible, in case other hon. Members wish to speak.

The Minister implied that it was impossible—I think that he used that very word—for the new development council to be truly accountable to growers. He made that point twice. He said that there was no precedent. There is a precedent. The Scottish Seed Development Council includes several direct grower representatives. The Minister can quote no precedent for the position that he now describes. It is an illusion to lead us up that blind alley.

The Minister said that there was no precedent for sharing the costs of abolition as opposed to putting the whole burden on the growers who have contributed all these years to the success of the scheme and the board. He has not been at the Ministry long, whereas I have now shadowed four Ministers. The precedent is that, when changes were made to the sheep variable premium scheme and the beef premium scheme, the Meat and Livestock Commission was compensated by MAFF. There is a precedent for a contribution from the Government.

I do not think that any of the Ministers on the Treasury Bench now were involved in the Committee which considered the Agriculture Bill. Few of the Opposition Members present this evening were involved, but I was. The text that we were given then did not come from the right hon. Member for South-West Norfolk (Mrs. Shephard). She was not the Minister. The Minister was the right hon. Member for Suffolk, Coastal (Mr. Gummer).

I and my fellow members of that Committee remember extremely well that the Minister did not deign to appear at many of the sittings of the Committee, but he did appear to give some explicit assurances—hon. Members on both sides of the House will recall them—about the circumstances in which he would agree to the abolition of the potato marketing scheme.

The right hon. Member for Suffolk, Coastal gave us the following assurance to encourage us to agree to the abolition of the scheme: I want a system under which no country tries unfairly to promote its own potatoes against other countries' so that we can all use the single market to sell our products. I want that because I think that British potatoes are good potatoes, that our producers and processors are of a high quality, and that we could beat the lot of them. We could do that only if we operated on a fair and equal basis.…Most of those countries that want a heavy regime would prefer a light regime to no regime if that were the only proposal on offer. Most of those countries that would prefer no regime will recognise in the end that they cannot have both no regime and a level playing field. They must decide which they prefer. In almost every case—I say almost because I have learnt not to say every—they will plump for a lightweight regime.We shall find ourselves with the package of a lightweight regime, which will be supported by enough countries for it to be accepted. That is the best assessment of what is the overwhelming likelihood. It could be that, for some reason which I have not detected, what I think is extremely likely to occur does not occur, but that is the best advice I can give to the Committee. That was the advice given to Members on both sides of the Committee. Conservative Members, Opposition Members, and I, as spokesman for Liberal Democrats, accepted in good faith the assurance that we were given by the right hon. Member for Suffolk, Coastal.

The right hon. Gentleman continued in the Standing Committee: I am merely saying that, without the very likely European regime, if it became clear that Britain was shooting itself in the foot by continuing the current potato marketing regime, no sensible Government would stand aside and say, 'Let the Dutch take it over. Let the French subsidise their industry into defeating ours.' In those circumstances, we would take measures, which would have to be approved by affirmative resolution, to replace the current potato marketing scheme with those elements that benefit us in the quest for export and import substitution and remove those elements that disadvantage us."—[Official Report, Standing Committee F, 4 May 1993; c. 225–27.] The Minister has not come before the House with any of the measures that his predecessor promised that Committee. We were fooled then into believing that he would. I hope that the House will recognise that we are being led up the garden path tonight.

The growers deserve nothing less than the fulfilment of that ministerial promise. I know that some Conservative Members share my concerns; they have expressed them privately and publicly; they have expressed them to growers; they have expressed them to the National Farmers Union. I hope that they will not let down the growers tonight.

There is no urgency about the passage of this order tonight. We could now insist that Ministers be held to their promise and that we get what they promised us. The growers must be given the explicit assurance that Ministers will now face up to the threat of predatory support by other member states' Governments to assist our competitors in the European Union.

The Minister tonight admitted failure so far. Why should that be a reason to trust the Government to achieve something in the future? Nothing has yet been achieved. The House of Commons must insist that Ministers be held to account for the promises that they have made.

Photo of Martyn Jones Martyn Jones , Clwyd South West 10:50 pm, 17th January 1996

What we are discussing this evening will not improve Britain's agriculture one iota. Deregulation of potato marketing is another example of the Tory policy of removing the steering wheel in the blind hope that that will make the car lighter and more efficient—ignoring the vehicle's susceptibility to crash.

I remind the House that the horrendous effects of BSE on the beef industry are a direct result of deregulation. Allowing the rendering industry to lower its temperature and solvent extraction standards to save a few pounds resulted in an epidemic that has cost the taxpayer over £200 million, and has cost farmers dearly.

Deregulation of the crop acreage of potatoes will allow for increased encouragement of precisely the unsustainable, monocultural and intensive agriculture that we are trying to move away from, buoyed up by the boom and bust cycle of an unordered market. That benefits the processor in the short term, but not in the long term. There is a vicious circle: the unordered market increases acreage, thereby increasing pollution and possibly ruining productive land. By encouraging this monoculture, we are shooting ourselves in the foot, as our growers are caught up in a spiralling risk of crop and/or market failure.

An unordered market leads to an increase in acreage devoted to potatoes, an increase in pesticide and fertiliser use, an increase in processor power over UK growers, and an increase in farmers' vulnerability. We need to be sustainable; we need to be fair. We must not cut farmers adrift and leave them in a sea of market distortion. Other EU countries are allowed to subsidise their potato production.

We are becoming increasingly sceptical of subsidising over-production and waste. Labour policy seeks to redirect regulation to encourage good, not bad, practice. Regulation under a light regime could allow us to move toward sustainable and efficient practices. The NFU is absolutely right in its reasonable desire to compete on even terms with our EU counterparts. We have heard a lot about level playing fields; perhaps we should refer to level potato fields for a change. Secondly, the NFU wants common rules governing competition—for example, not allowing other member states to provide state aid for their producers while British growers cannot enjoy similar support.

Thirdly, funding—if the Government are to go ahead with this daft idea—must be provided for winding up. Such transition funds should be used to smooth the path of farmers and producers alike towards a lightweight EU-wide regime.

The stakeholders have contributed to the potato marketing scheme, so it would only be right and proper for the Government to foot the bill for the producers, who do not want the change in the first place. The Government have expelled a lot of hot air about all the things they have done in the past six weeks. They have had three years to consider the matter, but are acting only now because they cannot think of anything better to do. They are panicking as they realise that they have not done enough work. Tory Members with rural constituencies know that, as some of their interventions—not their speeches—have shown.

The NFU and the Potato Marketing Board are wondering why the Minister does not implement his party's policy, as stated in the Committee quotation from 4 May 1993 read by the hon. Member for North Cornwall (Mr. Tyler). What has changed since then? Nothing—or nothing in Europe, anyway. This is just another doctrinaire policy, based on ideology and not on common sense.

Photo of Mr Dale Campbell-Savours Mr Dale Campbell-Savours , Workington 10:54 pm, 17th January 1996

May I say one or two words, and perhaps ask a couple of questions of the Minister? My hon. Friend the Member for Newcastle-under-Lyme (Mrs. Golding), who spoke from the Opposition Front Bench, and the Liberal spokesman, the hon. Member for North Cornwall (Mr. Tyler), raised an important issue in this debate, which is that, in Standing Committee on the Agriculture Bill, Ministers gave us clear assurances about what would happen in certain conditions. We sought those assurances because the industry—in the form of the National Farmers Union—and potato producers wanted to establish what Government policy would be in the event of difficulties in the marketplace.

I sensed that the Minister had not considered the speech made by his right hon. Friend the then Minister in Committee when he spoke tonight. My first question—perhaps the Minister can give us a clear answer—is, did he read that speech, and does he believe that he has met the undertakings given to Parliament in 1993?

Secondly, to what extent does the Minister have complete access to all Commission reports on state aids to the potato processing industry and potato producers throughout the European Community? Can he give us an assurance that he has an unfettered right to all the reports that the Commission produces?

If the Minister intends to take the British potato producers into a free market without undertakings on subsidy—to which the hon. Member for North Thanet (Mr. Gale) and I object anyway—surely he must have some mechanism for being made fully aware of what subsidies are being paid within the Community, so that, when they are being paid, he can immediately raise the matter with the Commission with a view to those national aids being removed.

Finally, the scheme was devised in such a way as to reduce the potential for volatility in price. As I understand it, the mechanics of the scheme are such that potato producers take decisions on what to plant in any particular year within a quota system and target areas, and are guided not to over-produce. They have to guess to what extent they would be prepared to plant up to quota. If I remember rightly, some research done by Nottingham university in 1992 proved that there would be considerable price volatility in the market if the scheme were removed.

If that is the case, what will happen in the event that, let us say for two or three years in succession, there is a glut in the United Kingdom potato market? In those conditions, growers will totally lose confidence. Having lost money in successive years, they will worry and wonder whether it is worth their while planting potatoes in a third year, not knowing what the price is likely to be and not being able to assure their bank managers, who may well be lending them money, what will happen to their loan repayments.

As a consequence, we may be faced in one, two or three years with a sudden drop in the area planted in the United Kingdom, and a scarcity in the marketplace on an unparalleled scale, which might well lead to the importing of potatoes.

I wonder what will happen—

Photo of Henry Bellingham Henry Bellingham , North West Norfolk

They will put up the price of soup.

Photo of Mr Dale Campbell-Savours Mr Dale Campbell-Savours , Workington

The hon. Gentleman should know. The plant in his constituency is taking jobs from mine in two months' time. I cannot say that I would look favourably on anything that would help Campbell's Soups at the moment.

What will happen if there is a total loss of confidence in the marketplace? I have great reservations; I know that it is an argument of the past, but without the scheme, so as far as there is a potential for a loss of confidence, Parliament needs some reassurance as to what the Government's actions might be.

11 pm

Photo of Ann Winterton Ann Winterton , Congleton

I shall detain the House only briefly. I have a simple political philosophy: if it ain't broke, don't fix it. Cheshire farmers and growers believe strongly that the Potato Marketing Board has not only served them well by ironing out the peaks and troughs of production, but has served the consumer well. The reforms—the removal of quotas and so on—have benefited growers, processors and consumers.

My only worry is that, after we have got rid of the potato marketing scheme, the industry may face unfair competition from our partners in Europe. Surely we are not so naive that we do not remember examples in the past, when we played the game as it should be played and removed subsidies, and other countries used subsidies from their national Governments to undermine our success.

I hope that when my hon. Friend the Minister replies to the debate, he will reassure hon. Members on both sides of the House who share my concern that he would consider using his powers to extend the revocation period, and that he will tell the House that if at the time—that is, in June 1997—he found that the market conditions within Europe were unfair, he would then seek to act on behalf of not only British growers, but British consumers.

Photo of John Home Robertson John Home Robertson , East Lothian 11:01 pm, 17th January 1996

It is extremely unusual for East Lothian and Congleton to be in agreement, but that is the case tonight. I represent some hundreds of potato producers in East Lothian. I also represent 68,000 potato consumers. It is surprising that more has not been said about the interests of consumers, who are also important.

I hope that the Minister will acknowledge that for many years the Potato Marketing Board has served the interests of consumers and producers very well. It is a complicated commodity and matters could become difficult for producers and consumers. Over a long period of years, the board has ensured a reasonable balance between supply and demand. I share the concern of my hon. Friend the Member for Workington (Mr. Campbell-Savours) that if we do away with the quotas and regulations, as the Minister is doing tonight, in a future year there could be a glut, the price could collapse and there could be a serious shortage in the following year. That would be bad news for all concerned in the United Kingdom, and our neighbours in mainland Europe would certainly take advantage of that. That brings me to state aid to industry on mainland Europe. I am anxious that today we are doing away with one scheme and creating a vacuum that could be completely against the interests of our producers and consumers.

Various Conservative Members have said that the Government should pay careful attention to state aid on mainland Europe and should be ready to take vigorous action. What on earth does that mean? Will the Minister of Agriculture, Fisheries and Food go round auditing the accounts of potato producers and processors in every nook and cranny of mainland Europe? Obviously the Commission will not do so, unless there is the regime that we want to see. It is likely that unfair competition will develop. It would be a serious error to tear up what is left of the scheme in the absence of something better in its place. It is grotesquely irresponsible of the Minister to be leading the industry and consumers up the creek without a paddle as a result of the debate.

Photo of Tim Boswell Tim Boswell Parliamentary Secretary (Ministry of Agriculture, Fisheries and Food) 11:04 pm, 17th January 1996

With the leave of the House, I shall reply to the interesting points made in the debate. The hon. Member for Newcastle-under-Lyme (Mrs. Golding) made the most revealing speech of many in a revealing and useful debate. The totem that she enunciated, in which she was apparently joined in unity by the hon. Member for East Lothian (Mr. Home Robertson), was that we should not destroy that which we have. If that is new Labour, it is an interesting gloss on new Labour. I was disappointed that the hon. Lady, in her somewhat limited remarks, was not able to define—and no other Opposition Member could—the position of stakeholders. The hon. Member for Clwyd, South-West (Mr. Jones) characteristically identified himself solely with producer interests. Conservative Members firmly believe in the interests of producers and consumers, who will be favoured by the proposed deregulation.

Only through the House passing the revocation order will the Potato Marketing Board be free to implement its plans to bring forward agreed proposals for a successor body. That is the way forward for the industry, rather than staying as it is.

The hon. Lady and other hon. Members did not seem to reflect the correct economic context. The hon. Member for North Cornwall (Mr. Tyler) mentioned the current state of exports and imports, particularly in relation to processing. My hon. Friend the Member for North Thanet (Mr. Gale) referred to the familiar fact that a high proportion of our imports are for processing—an area where we have tended to lose market share over the years. It is significant that since our announcement more than two years ago on winding up the scheme, processors have committed themselves to £50 million of additional investment in this country, which supposes that they will obtain supplies and that it will be economic to source from British producers.

There was a degree of obsession with activities in Europe, both as to state aids and the economic regime for the countries involved. It is clear that the most successful countries—in certain cases, those that want no regime—are those that do not subsidise their growers and emphasise the importance of being able to produce for the market.

As to the speech of my hon. Friend the Member for North Thanet, I much welcomed his robust attitude to the principle of subsidy and control arid his general remarks about state aids, which struck a chord with me. I understand his concern and that of the hon. Member for Pembroke (Mr. Ainger) regarding the special conditions for early potatoes. Occasionally, as is bound to happen with any commodity market, there is some instability where there is a high emphasis on the seasonal premium. As we move into a single market, the logic is that it should not readily be possible to dump, because it is open to our producers to export into markets offering a higher price. That is exemplified by recent experience.

There is no universal or general experience of damage to our growers from the prevalent practice of state aids in other member states being applied in such a way as to distort competition.

Photo of Nick Ainger Nick Ainger , Pembroke

Why did the then Minister, now Secretary of State for the Environment, go to such great lengths in Standing Committee to make a series of commitments in relation to state aids in Europe? Can the Minister answer that?

Photo of Tim Boswell Tim Boswell Parliamentary Secretary (Ministry of Agriculture, Fisheries and Food)

I can tell the hon. Gentleman that my right hon. and learned Friend the Minister, who normally attends the Council, is tireless in pursuing those matters and in pressing the Commission and his colleagues to obtain a regime that will enable us to go forward.

There is no significant evidence at this stage—if there is, perhaps hon. Members will send it to me—of damage caused to the British potato industry by the imports to which reference has been made. They cause nothing like the damage that is done by the industry being held back by outmoded modes of regulation. I say to those who have argued in favour of the maintenance of the scheme—they are apparently in favour of quotas—that merely maintaining it, when the board has taken the decision to lift quotas, would not by itself produce that which they want.

It is interesting that my hon. Friend the Member for St. Ives (Mr. Harris) made it clear that in reality there is no systematic or serious opposition to our proposals. There are concerns, of course, and there is acknowledgement of the board's role in the past and of some of its achievements. That I readily acknowledge, but there is no systematic wish to continue with the practices of the past.

An issue that does not strictly arise from the order—it was mentioned by my hon. Friend the Member for St. Ives—is brown rot, which is apparent in Dutch seed potatoes. The Commission, on the advice of the Plant Health Committee, has taken action. We supplemented that with our own agreed national action. We take the matter seriously. We are determined to protect the British potato industry and our seed stocks. As a result of our testing programme, one lot of seed imported from the Netherlands has been identified with a case of brown rot. The matter has been reported to me within the past 24 hours. Under current legislation, we have the ability to control that seed. It cannot be planted without our permission. We have notified the Dutch authorities and the Commission, which will be considering the matter again in the Plant Health Committee next week. We shall continue to pursue our testing regime and to control all imports from the Dutch source.

I return to the general points. What is the regime that is desirable for the potato industry? Whatever the merits of a lightweight regime, which we shall continue to press vigorously in Europe, there is no advantage in holding up the revocation of the scheme to secure such a regime. The consequences of the present scheme and the inhibitions and costs that it has imposed and incurred are greater than any advantages that it offers the British grower or consumer. It would be desirable to secure a lightweight regime, but the two matters are separate. It is time to move on.

The emphasis of the existing regulations, which have their genesis in the thinking of two generations ago, is bureaucracy and restriction. The board and the industry are ready and waiting for change. We will not reintroduce quotas and control. We believe that there should be the earliest possible action and that the right way to take that action is to pass the order that I have commended to the House.

Question put:—

The House divided: Ayes 193, Noes 161.

Division No. 29][11.13 pm
Alexander, RichardFabricant, Michael
Allason, Rupert (Torbay)Field, Barry (Isle of Wight)
Arbuthnot, JamesFishburn, Dudley
Arnold, Jacques (Gravesham)Forman, Nigel
Arnold, Sir Thomas (Hazel Grv)Forth, Eric
Atkins, Rt Hon RobertFowler, Rt Hon Sir Norman
Atkinson, David (Bour'mouth E)Fox, Dr Liam (Woodspring)
Atkinson, Peter (Hexham)Freeman, Rt Hon Roger
Baker, Nicholas (North Dorset)French, Douglas
Baldry, TonyGale, Roger
Bates, MichaelGailie, Phil
Batiste, Spencer Garel-Jones, Rt Hon Tristan
Beggs, RoyGarnier, Edward
Bellingham, HenryGill, Christopher
Beresford, Sir PaulGillen, Cheryl
Biffen, Rt Hon JohnGoodlad, Rt Hon Alastair
Bonsor, Sir NicholasGoodson-Wickes, Dr Charles
Boswell, TimGreenway, Harry (Ealing N)
Bottomley, Peter (Eltham)Greenway, John (Ryedale)
Bowden, Sir AndrewGriffiths, Peter (Portsmouth, N)
Bowis, JohnHamilton, Rt Hon Sir Archibald
Brandreth, GylesHamilton, Neil (Tatton)
Brazier, JulianHanley, Rt Hon Jeremy
Brooke, Rt Hon PeterHargreaves, Andrew
Brown, M (Brigg & Cl'thorpes)Harris, David
Browning, Mrs AngelaHaselhurst, Sir Alan
Bruce, Ian (Dorset)Hawkins, Nick
Burns, SimonHawksley, Warren
Burt, AlistairHeald, Oliver
Butterfili, JohnHeathcoat-Amory, Rt Hon David
Carlisle, Sir Kenneth (Lincoln)Hendry, Charles
Carrington, MatthewHogg, Rt Hon Douglas (G'tham)
Carttiss, MichaelHoram, John
Cash, WilliamHoward, Rt Hon Michael
Channon, Rt Hon PaulHughes, Robert G (Harrow W)
Chapman, Sir SydneyHunt, Rt Hon David (Wirral W)
Clappison, JamesHunt, Sir John (Ravensbourne)
Clark, Dr Michael (Rochford)Hunter, Andrew
Clifton-Brown, GeoffreyJack, Michael
Coe, SebastianJackson, Robert (Wantage)
Congdon, DavidJessel, Toby
Conway, DerekJones, Gwilym (Cardiff N)
Coombs, Anthony (Wyre For'st)Jones, Robert B (W Hertfdshr)
Coombs, Simon (Swindon)Kirkhope, Timothy
Cope, Rt Hon Sir JohnKnapman, Roger
Cran, JamesKnight, Mrs Angela (Erewash)
Davies, Quentin (Stamford)Knight, Rt Hon Greg (Derby N)
Davis, David (Boothferry)Knox, Sir David
Day, StephenKynoch, George (Kincardine)
Devlin, TimLait, Mrs Jacqui
Dover, DenLawrence, Sir Ivan
Duncan, AlanLegg, Barry
Duncan-Smith, IainLester, Sir James (Broxtowe)
Dunn, BobLidington, David
Durant, Sir AnthonyLloyd, Rt Hon Sir Peter (Fareham)
Dykes, HughMacKay, Andrew
Elletson, HaroldMaclean, Rt Hon David
Evans, David (Welwyn Hatfield)Maitland, Lady Olga
Evans, Jonathan (Brecon)Malone, Gerald
Evans, Nigel (Ribble Valley)Mans, Keith
Faber, DavidMarland, Paul
Marlow, TonySpink, Dr Robert
Martin, David (Portsmouth S)Sproat, Iain
Mates, MichaelSquire, Robin (Hornchurch)
Mawhinney, Rt Hon Dr BrianStanley, Rt Hon Sir John
Merchant, PiersSteen, Anthony
Mitchell, Andrew (Gedling)Stephen, Michael
Mitchell, Sir David (NW Hants)Streeter, Gary
Montgomery, Sir FergusSweeney, Walter
Neubert, Sir MichaelTaylor, Ian (Esher)
Newton, Rt Hon TonyTaylor, John M (Solihull)
Nicholson, David (Taunton)Taylor, Sir Teddy (Southend, E)
Norris, SteveTemple-Morris, Peter
Onslow, Rt Hon Sir CranleyThomason, Roy
Page, RichardThompson, Sir Donald (C'er V)
Paice, JamesThompson, Patrick (Norwich N)
Patnick, Sir IrvineThomton, Sir Malcolm
Pattie, Rt Hon Sir GeoffreyThurnham, Peter
Pickles, EricTredinnick, David
Porter, David (Waveney)Twinn, Dr Ian
Powell, William (Corby)Viggers, Peter
Redwood, Rt Hon JohnWaldegrave, Rt Hon William
Renton, Rt Hon TimWalker, Bill (N Tayside)
Richards, RodWaller, Gary
Riddick, GrahamWardle, Charles (Bexhill)
Roberts, Rt Hon Sir WynWaterson, Nigel
Robertson, Raymond (Ab'd'n S)Watts, John
Robinson, Mark (Somerton)Whitney, Ray
Roe, Mrs Marion (Broxbourne)Whittingdale, John
Rowe, Andrew (Mid Kent)Widdecombe, Ann
Sainsbury, Rt Hon Sir TimothyWillkinson, John
Scott, Rt Hon Sir NicholasWilletts, David
Shaw, David (Dover)Winterton, Mrs Ann (Congleton)
Shepherd, Sir Colin (Hereford)Wlofson, Mark
Shepherd, Richard (Aldridge)Wood, Timothy
Sims, Roger
Spencer, Sir DerekTellers for the Ayes:
Spicer, Sir Michael (S Worcs)Mr. Bowen Wells and
Mr. Patrick McLouglin.
Adams, Mrs IreneCummings, John
Ainger, NickDafis, Cynog
Anderson, Donald (Swansea E)Darling, Alistair
Anderson, Ms Janet (Ros'dale)Davidson, Ian
Armstrong, HilaryDavis, Terry (B'ham, H'dge H'l)
Ashdown, Rt Hon PaddyDenham, John
Battle, JohnDewar, Donald
Bayley, HughDixon, Don
Beckett, Rt Hon MargaretDonohoe, Brian H
Berry, RogerDowd, Jim
Betts, CliveDunwoody, Mrs Gwyneth
Boateng, PaulEagle, Ms Angela
Bradley, KeithEastham, Ken
Brown, N (N'c'tle upon Tyne E)Etherington, Bill
Bruce, Malcolm (Gordon)Flynn, Paul
Byers, StephenFoster, Don (Bath)
Callaghan, JimFyfe, Maria
Campbell, Mrs Anne (C'bridge)Galbraith, Sam
Campbell, Menzies (Fife NE)Gapes, Mike
Campbell, Ronnie (Blyth V)George, Bruce
Campbell-Savours, D NGerrard, Neil
Canavan, DennisGilbert, Rt Hon Dr John
Carlile, Alexander (Montgomery)Godman, Dr Norman A
Chidgey, DavidGodsiff, Roger
Chisholm, MalcolmGolding, Mrs Lin
Clapham, MichaelGraham, Thomas
Clark, Dr David (South Shields)Grant, Bernie (Tottenham)
Clarke, Eric (Midlothian)Griffiths, Nigel (Edinburgh S)
Clarke, Tom (Monklands W)Griffiths, Win (Bridgend)
Clelland, DavidGrocott, Bruce
Clwyd, Mrs AnnHall, Mike
Coffey, AnnHanson, David
Cohen, HarryHarvey, Nick
Cook, Frank (Stockton N)Henderson, Doug
Corbyn, JeremyHeppell, John
Corston, JeanHill, Keith (Streatham)
Hinchliffe, DavidO'Neill, Martin
Hoey, KatePearson, Ian
Home Robertson, JohnPickthall, Colin
Howarth, Alan (Strat'rd-on-A)Pike, Peter L
Howarth, George (Knowsley North)Pope, Greg
Hughes, Robert (Aberdeen N)Powell, Ray (Ogmore)
Illsley, EricPrentice, Bridget (Lew'm E)
Ingram, AdamPrentice, Gordon (Pendle)
Jamieson, DavidPrescott, Rt Hon John
Jones, Ieuan Wyn (Ynys Môn)Primarolo, Dawn
Jones, Marlyn (Clwyd, SW)Quin, Ms Joyce
Kennedy, Jane (L'pool Br'dg'n)Raynsford, Nick
Kilfoyle, PeterReid, Dr John
Kirkwood, ArchyRendel, David
Liddell, Mrs HelenRobertson, George (Hamilton)
Lloyd, Tony (Stretford)Roche, Mrs Barbara
Llwyd, ElfynRooker, Jeff
Lynne, Ms LizRoss, Ernie (Dundee W)
McAllion, JohnRowlands, Ted
McCartney, IanSalmond, Alex
Mackinlay, AndrewSheerman, Barry
McMaster, GordonShort, Clare
McWilliam, JohnSimpson, Alan
Madden, MaxSkinner, Dennis
Mahon, AliceSmith, Andrew (Oxford E)
Marek, Dr JohnSmith, Llew (Blaenau Gwent)
Meale, AlanSpearing, Nigel
Michael, AlunSpellar, John
Michie, Bill (Sheffield Heeley)Steinberg, Gerry
Milburn, AlanStevenson, George
Moonie, Dr LewisStrang, Dr. Gavin
Morgan, RhodriSutcliffe, Gerry
Morley, ElliotTaylor, Matthew (Truro)
Morris, Estelle (B'ham Yardley)Thompson, Jack (Wansbeck)
Mowlam, MarjorieTipping, Paddy
Mudie, GeorgeTouhig, Don
Mullin, ChrisTurner, Dennis
Murphy, PaulTyler, Paul
O'Brien, Mike (N W'kshire)
Olner, Bill
Wallace, JamesWise, Audrey
Walley, JoanWray, Jimmy
Wareing, Robert NWright, Dr Tony
Watson, Mike
Welsh, AndrewTellers for the Noes:
Wicks, MalcolmMr. Joe Benton and
Williams, Alan W (Carmarthen)Mr. Eric Martlew.

Question accordingly agreed to.

Resolved,That the draft Potato Marketing Scheme (Commencement of Revocation Period) Order 1995, which was laid before this House on 12th December, be approved.