Easter Adjournment

Part of Deferred Division No. 85 – in the House of Commons at 1:52 pm on 29th March 2007.

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Photo of David Heath David Heath Shadow Leader of the House of Commons, Shadow Spokesperson (Cabinet Office) 1:52 pm, 29th March 2007

The right hon. Gentleman is absolutely right. I will not get into a quarrel with him on the relative merits of Stilton and Cheddar—they are both very good, and we can enjoy them. As he says, it is not the primary producers who are making the profit.

Even the supermarkets have not thought the situation through. I have never been convinced that consumers buy milk on the basis of price when confronted with a supermarket shelf of milk. They buy a volume of milk and they pay the price. Therefore, if supermarkets must maintain their current profit level—we all know the great profits that they are capable of making—it would be sustainable for them to do so by increasing the retail price of milk. There are some small signs that that is beginning to happen, at least from the assurances given by supermarkets. However, we have had those assurances before, and they have not been sustained. I am afraid to say that I do not believe that that will be achieved by voluntary arrangement. At the end of the day, there will have to be Government intervention in what is effectively a false market in milk. That is why everyone is waiting with bated breath for the outcome of the Competition Commission report, although I am not entirely optimistic about that. We saw what it did last time when, as the Monopolies and Mergers Commission, it examined vertical integration in milk in the context of Milk Marque. We saw then what it said about the relationship between the producer and the supermarkets. If we ask the wrong questions, we get the wrong answers. The fact that it is saying that it does not have evidence of a distorted market when the distorted market is there for anyone to see in the price of milk, does not fill me with confidence.

Nevertheless, we will have to go beyond a voluntary code of conduct into something that is on a firmer basis if we are ever to see the rescue of the dairy industry. Some people would be happy for the dairy industry to contract and, in their eyes, be made more efficient by the 1,000-header herds owned by an agricultural conglomerate, but the traditional dairy farm run by a family is the building block of British agriculture. It is what is best for this country in terms of both produce and our environment. I want it to be maintained.

The second issue in farming is the ongoing problem with Mycobacterium bovis—tuberculosis—in cattle. The Government are ducking the problem. They have consulted, and the consultation has finished, but they are still not prepared to come to a decision. I know it is a difficult decision to make. It will be very unpopular—almost any decision that they are going to take will be unpopular. However, we cannot have a continuing growth of the spread of TB among the bovine and badger populations. The welfare of cattle is important; the welfare of badgers and other wild species that carry the bacterium is important. We need swift decisions on what is to be done. How do we attack the reservoir of infection effectively? We must also deal with the corollary issue—the profitability of farms. It is devastating when a herd tests positive for TB. It is even more devastating if the recompense—the table valuations—does not recognise the actual value of the stock that is culled. That needs addressing.

There are also opportunities in agriculture. Climate change should provide a massive opportunity for diversification into new crops and new ways of doing business, yet I do not see any joined-up thinking between those who are involved with agriculture, with the environment and with trade and industry, in particular those who have the energy brief. I see no evidence that they understand how those are linked and how we can open up new opportunities for agriculture.

I do not see the incentives for young farmers to come into the industry. That is a serious problem. Farms in my county—I am sure that this is typical of many parts of the country—are often run by people in middle-age to late middle-age whose children are not interested in carrying the farms on. Younger people cannot see a future in farming and are leaving to do other things. That is their right, but we need those who want to make their living from the land to have the opportunity to come into the industry. That is not available to them.