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Common Agricultural Policy

8. Mr. Derek Wyatt (Sittingbourne and Sheppey): What assessment she has made of how the mid-term review of the CAP will be affected by the enlargement of the EU; and if she will make a statement. [20561]

The Secretary of State for Environment, Food and Rural Affairs (Margaret Beckett): We expect the European Commission to initiate the mid-term review in 2002. Agreement on the agricultural elements of the enlargement negotiations has yet to be secured, so it is not yet possible to assess precisely how the enlargement and CAP reform dynamics will impact on each other.

The environmental damage and budgetary costs of extending the CAP to new member states both add weight to the UK Government's position that the CAP must be reformed sooner rather than later.

Mr. Wyatt: I thank my right hon. Friend for that reply. I realise that it is a complex issue. Farmers in my constituency keep cattle and sheep and others produce apples, pears, cherries, raspberries and strawberries. Our worry is that Tesco and Walmart—and not the consumer and the farmer—will be enabled. Can she be persuaded to ask the regional development agencies to hold a series of

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one-day conferences so that we can discuss with farmers the type of economic reform that is needed and the help that we can give?

Margaret Beckett: I appreciate my hon. Friend's interest in the subject, and he made a very interesting suggestion. I undertake to consider whether that or other means will enable us to do more to draw in input from exactly the stakeholders to whom he referred.

Sir Robert Smith (West Aberdeenshire and Kincardine): In the right hon. Lady's plans to take forward negotiations on CAP reform, what will she do to deal with the problem of the high value of the pound and its fluctuation against the euro, especially now that the agrimonetary compensation schemes are to come to an end? Is she working to find replacement schemes?

Margaret Beckett: We recognise that agriculture is one of those sectors in the United Kingdom that has suffered an impact as a result of the level of the currency. The hon. Gentleman will know that Governments who have tried to meddle with the level of the currency have rarely been successful. However, I think that it is true to say that rarely have any British Government been worried by the level of the pound being too high, except for when Lord Lawson tried to keep it high deliberately.

Our goals for CAP reform are to provide greater room for manoeuvre and flexibility and to try to steer resources away from what is known as the first pillar and into the second pillar of rural support—agri-environment schemes and so on. Indeed, if we can, we hope to break the link between support for market-distorting subsidies and direct support for production. The hon. Gentleman's ideas about the issues that we should pursue in CAP reform are, I am afraid, not at the top of our agenda.

Mr. Bill Tynan (Hamilton, South): Does my right hon. Friend agree that reform of the common agricultural policy has long been an ambition of all of us in this country? Does she accept that enlargement gives us an opportunity to examine the relevance of the CAP and to ensure that any change is beneficial to the enlarged Community in Europe?

Margaret Beckett: My hon. Friend is right that enlargement is a key issue. It concentrates people's minds on the need for CAP reform, which has long been recognised in this country. There is also the additional pressure of the timetable negotiated by my right hon. Friends and others in Doha, under which the European Union has to get together a negotiating package of proposals, probably by spring 2003. All those things, along with the mid-term review that was already scheduled, bring greater pressure to bear than ever before in respect the need, and drivers, for CAP reform.

Mr. Geoffrey Clifton-Brown (Cotswold): Before I go any further and get into trouble, the House should be aware of my farming interests.

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Does the Secretary of State agree that to enlarge the EU, the CAP will have to be reformed? If so, does she also agree that every member, both new applicant countries and existing countries, should move towards a deregulated agricultural market, not a protected one?

Margaret Beckett: I certainly agree that those are parallel processes. It is common ground in most quarters of the House that CAP reform should be pursued. Enlargement gives further impetus to the need for reform and provides a useful driver. I share the hon. Gentleman's view, if I understand him correctly, that we should aim for a thriving and successful agriculture industry that thrives and succeeds without needing all the direct support from the Government.

Joyce Quin (Gateshead, East and Washington, West): In addition to the pressures for reform to which my right hon. Friend referred, does she agree that it is also important to treat developing countries more fairly in the world trading and agricultural systems? What work is she doing to build up a coalition for reform within the EU, in particular with key allies such as Germany, Sweden and Denmark, to ensure that all opportunities for reform are taken as firmly and robustly as possible?

Margaret Beckett: I am grateful to my right hon. Friend for raising that. I agree that it is important to give developing countries proper access to our markets in this and other sectors. On alliances, we are building on the solid foundations that were securely laid when my right hon. Friend was a Minister in the Department. We continue to work in particular with the countries that she named. The intention was to have a further discussion, which would have been held fairly recently, but the Danish Government decided to have a general election instead. We anticipate reinstating that engagement soon.

Hugh Robertson (Faversham and Mid-Kent): As part of the Secretary of State's review of CAP reform, will she undertake to ensure that the needs of the horticulture industry are considered and, as more countries join the EU, that proposals for fair and transparent labelling are introduced?

Margaret Beckett: The whole issue of labelling is frequently discussed in a variety of ways in the CAP as it stands, never mind how it might be reformed. I take the hon. Gentleman's point. He will know that horticulture does not feature large on the list of top priorities for consideration in the mid-term review, but I can assure him that we will try to ensure that no opportunity for beneficial reform is overlooked.

Mr. Dennis Skinner (Bolsover): It is intriguing to hear the clamour from the Tories and the Liberals on the need for CAP reform. May I make a simple forecast? If my right hon. Friend or any other Labour Minister reforms the CAP, the farmers in all the Tory and Liberal constituencies will squeal like busted pigs and the Tories and the Liberals will vote against it.

Margaret Beckett: My hon. Friend has often shown remarkable prescience. For everybody's sake, I hope that we and our allies in the European Union will be successful in substantially reforming the CAP, because that is highly

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desirable, but I accept that, whatever success the Government achieve, it will not be recognised by Opposition Members.

Bob Spink (Castle Point): May I tempt the right hon. Lady to go a step further and talk not about reforming but entirely dismantling the CAP, which has proved to be entirely incompatible with enlargement? It is expensive and futile, and it is perceived as such. Should not the Government lead the way in Europe towards dismantling it?

Margaret Beckett: It is arguable that the Government have been leading the way in negotiations in Berlin and elsewhere, although it is important that there is a core group of nations that are of one mind in seeking reform. I share the hon. Gentleman's view on the CAP, that there is very little to praise and much to blame.

Meat Exports

9. Mr. Lindsay Hoyle (Chorley): If she will ease the restrictions imposed on those exporting British meat. [20563]

The Parliamentary Under-Secretary of State for Environment, Food and Rural Affairs (Mr. Elliot Morley): The current restrictions on exports of British meat as a result of the foot and mouth outbreak are imposed by European Community law. As the disease situation improves, we are continuing to seek amendments that will ease them without jeopardising effective disease controls.

Mr. Hoyle: I thank my hon. Friend for that answer, but could he go a little further? Sheep farmers in my constituency have suffered because they used to farm beef and, when the beef market collapsed and they could not export, they took up sheep farming, hoping to export at a better price. Unfortunately, the restrictions mean that they do not receive a price that reflects the true worth of their lambs. Can my hon. Friend introduce blood testing, as a way to ensure that exports can resume earlier?

Mr. Morley: I returned yesterday from an international conference on foot and mouth disease in Brussels, where a whole range of issues was raised, including the possibility of a greater role for blood testing and new technology that could aid disease controls. The Government, with the support of the Commission and other member states that have been very sympathetic, have been successful in regaining our exports as quickly as we realistically could, given the scale of the disease outbreak. I appreciate that there are still many restrictions on my hon. Friend's constituents in the sheep industry. However, on the continent, prices for sheepmeat are good at the moment, and I am sure that farmers will benefit from that as we gradually expand the export market.

Malcolm Bruce (Gordon): What does the Minister propose to do about the French conditions, which will effectively keep British lambs out of the key French market by requiring that all lambs over six months have the spinal column removed? Given that we do not have a traceability scheme for sheep, it is obviously impossible to give that assurance, so we will be shut out of the market. The French need our quality and we need their

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market. What is my hon. Friend going to do about that? In light of the decision on beef, will he ensure that the French comply with their obligations to have a single market operation?

Mr. Morley: I got two questions for the price of one. First, the French proposals for additional sheep controls raise serious issues because we do not think that they are justified by the science or, indeed, by reference to consumer protection. The matter was raised at the last Agriculture Council and it will come up at the next one. Our position is that the controls place unnecessary restrictions on the sheep sector. On the recent European judgment, we were always confident that our position would be upheld by the European Court of Justice, and we now expect the French Government to comply.

Mr. Douglas Hogg (Sleaford and North Hykeham): Is it not also important to review policy on the import into the United Kingdom of meat for personal consumption?

Mr. Morley: Yes, we have been reviewing that, and the need to review border controls and inspection came up at yesterday's conference. According to the papers presented at the conference, this has been the worst year ever for foot and mouth outbreaks internationally, and of course we have suffered as part of that. We need to consider a range of measures, and certainly border controls are one of them.

Mr. Peter Ainsworth (East Surrey): Will the Minister join me in expressing delight at today's European Court ruling that the French ban on British beef was illegal? Will he now ensure that maximum pressure is brought to bear on the French Government to comply with the law without further delay? What consideration has he given to seeking compensation from the French Government for damage to British producers and exporters? Will that be done in the event of a failure to comply in a timely manner? Will he commit the Government to doing everything possible to help reopen that important market for British producers, which is worth hundreds of millions of pounds?

Mr. Morley: I repeat that we welcome the ruling of the European Court, which we expected because we always argued that the French position was illegal. Just to be clear, the dispute was between the French Government and the Commission. The French Government went against the rules of the Community and the Commission pressed the case successfully. I understand that the Court has powers to impose a daily fine on the French Government if they do not comply, and I am sure that it will consider that. The Government do not have a statutory procedure on compensation, but United Kingdom companies and firms may wish to pursue it, and we will provide them with support, advice and assistance on that.

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