Pig Industry Restructuring (Capital Grant) Scheme 2001

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Mr. Paice: I want to bring the Minister back to the swine fever expenditure that has come out of the money allocated to the scheme for this year. Despite her belief otherwise, the industry will get a shock. I had discussions with the National Pig Association last week, and it did not seem to register the fact that the lost £26 million had been spent elsewhere.

As the Minister knows, that money is only 80 per cent. of that allocated for the swine fever compensation. The rest is to be paid for by a levy that is currently the subject of consultation. If there is a problem with time scale, could the Government not temporarily use some of the underspent money as a bridging loan? That would give full compensation to producers whose pigs suffer from swine fever, much more quickly than if they had to wait for a levy that may not be collected until towards the end of the calendar year. It would not remove any money from the scheme, and the cost could later be recovered from the levy.

Ms Quin: The hon. Gentleman is being somewhat inconsistent. One minute he criticises me for the fact that Government money is spent on classical swine fever measures, and then he asks me to spend even more on them instead of rolling the money over as I have described. The most fundamental objection to what he suggests is that we would spend money before we had received the approval of the House for the levy to be raised in such a way. It would be improper for a Government to assume, in advance of the House of Commons giving consent, that consent would be given and that we could spend the money anyway. That is the most fundamental objection to what has been suggested.

Mr. Clifton-Brown rose—

The Chairman: The Minister has taken many interventions.

Mr. Clifton-Brown: I have made only two, Mr. Olner.

Will the Minister answer the second part of my first intervention? What will happen if the number of applications exhausts the money available? Will applications be treated on a ``first come, first served'' basis? Will reapplications be possible the following year?

Ms Quin: As to ongoers, we expect to conclude consideration of the allocation of the money by August. The scheme is already open for people to express interest, but no money can be paid until all the orders have undergone the proper parliamentary procedures. That point is linked to the answer that I gave a few minutes ago.

It is difficult to give a categorical answer about exhaustion of the funds. There has certainly been a lot of interest from pig producers in the outgoers part of the scheme. We received a huge number of requests for application forms. However, the system is a sealed bid system with a deadline, and bids are being received at a much slower rate. We will not have a clear idea about that aspect of the matter until we are nearer to the cut-off date.

Some of the wider issues that were raised about the future of the pig industry are relevant to the question of ongoers. Possibly they are also relevant to outgoers, who will have to state that they will not be in pig production for 10 years. Whether pig producers want to leave or to continue, they must evaluate their commercial prospects for the next few years. Some outgoers who were intending to apply for outgoer support might decide that if the market could pick up or be sustainable they should not tie themselves into remaining out of production for 10 years. Ongoers will also reflect carefully on the level of investment that they want to make, and their judgment about the likely state of the market. Many factors are involved and it is difficult to give a categorical answer about them now.

The obvious answer to the hon. Gentleman's question is that we hope to be able to satisfy as many demands as possible. The likelihood of that is good. I noted what was said earlier about the ongoers funding being, as the hon. Member for South-East Cambridgeshire said, the rebate concession, and that we should therefore pay close attention to the number of people applying to benefit from it. We may have to undertake such consideration, beyond the period for which we have already budgeted, to work out whether what is being done is the best way of helping pig producers in the long term. The present signs are that interest is at a good level for both outgoers' and ongoers' elements of the scheme.

The hon. Member for Somerton and Frome asked about the state of negotiations between the applicant and the bank. Those are separate negotiations in which the Ministry is not involved, although, for the purpose of support, we will eventually be involved in approving and accepting the business plan. The hon. Gentleman's fears on that score are not likely to be realised.

Many wider issues were raised in Committee, to which it would not be wise for me to respond here. Some of them have already been discussed in Agriculture debates and at Agriculture Question Time. That is particularly true of some of the questions that were raised about labelling. The Government have a good record on that and on their readiness to attend to the industry's concerns, both about unilateral animal welfare standards and about integrated pollution prevention and control. Those issues should be pursued separately, but the Government have taken several relevant initiatives and I should be happy, in the appropriate forums, to defend their record.

Mr. Tyler rose—

The Chairman: The Minister has sat down.

Question put and agreed to.


    That the Committee has considered the Pig Industry Restructuring (Capital Grant) Scheme 2001.

        Committee rose at four minutes to Six o'clock.

The following Members attended the Committee:
Olner, Mr. Bill (Chairman)
Berry, Mr.
Cash, Mr.
Clifton-Brown, Mr.
Gilroy, Mrs.
Heath, Mr. David
Jenkins, Mr.
McGuire, Mrs.
Paice, Mr.
Prosser, Mr.
Quin, Ms
Ruane, Mr.
Tyler, Mr.
Woodward, Mr.

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Prepared 13 February 2001