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6 Nov 2002 : Column 344—continued

Mr. Simon Thomas: The hon. Gentleman spoke of the dealers driving the process. I know what he is trying to say, but it is surely the supermarkets that are driving it. On the whole, the dealers are responding to a supermarket-set agenda when it comes to beef and sheep meat.

Mr. Drew: I do not disagree with the hon. Gentleman, in that we have to acknowledge that the operation of the food chain is too centralised. I have long argued that we need to re-localise it, but people say that that option has now gone away from us and that we have to be realistic and realise that the chain is now fundamentally different.

Paul Flynn: Does my hon. Friend think it false of the Opposition to blame the Government and the supermarkets for all the problems of the farming industry? Is it not true, as my hon. Friend the Member for Preseli Pembrokeshire (Mrs. Lawrence) said, that one group of animals bought by a farmer just before the foot and mouth epidemic was discovered, to his horror, to have been on 11 different holdings in the previous three months? That was all about fraud, and about maximising the number of payments made for those animals. That practice for sheep—bed and breakfasting, as it is called—was rife in the industry, and the 20-day rule is the answer to the problem.

Mr. Drew: I cannot speak with the same knowledge as my hon. Friend, although I have made allegations about my own area. Farmers there have been very clear with me about where some of the blame—we are talking about a minority of people—needs to be laid in relation to the dreadful legacy of foot and mouth.

My second point relates to that matter. We have created a monster that has now come back to haunt us, in that the subsidy regime encourages the movement of animals in a foolhardy way. At the moment, we have not dealt with that. We have to deal with the fact that people make money by operating this process—whether at the behest of the supermarkets or because of what the industry has become—and that they are being encouraged to do so by the subsidy regime, through bed and breakfasting or through the way in which the common agricultural policy encourages animal movements.

Mr. Wiggin: I am listening to the hon. Gentleman's argument. He has described farmers as reckless for moving sheep—those are his words—but now he suggests that the blame lies not with the farmers, but with the subsidy-driven system and the rules under which farming is governed, which contain loopholes that encourage people to benefit from sheep movements. Unfortunately, he cannot have it both ways. Not for one second do I believe that people who are moving sheep around the country are reckless; they are living with

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market forces. Does he really think that the Government cannot control how subsidies are paid, except through this Bill?

Mr. Drew: I am not saying that at all, and the hon. Gentleman is doing my argument a disservice. In the main, I would call the people involved dealers, although some farmers are dealers, and the recklessness relates to the number of times that the animals are moved. I am also arguing that people are encouraged to do this by the subsidy regime that has been put in place. I would remove that subsidy regime tomorrow, but, unfortunately, that would have to go through European negotiations. Clearly, other parts of Europe undertake such movements more successfully in that they have not encountered the same number of breakdowns as us. However, they should learn from our mistakes, which is why, in essence, we need restrictions until we have dealt with that problem.

What is wrong with the amendment from the other place? I could understand the point of it if it provided some discretion, but it would allow a time scale of only eight weeks, come what may. To me, that would be the most unrestrictive restriction possible.

Mr. Peter Atkinson : I am puzzling over the allegation that, somehow, the subsidy system prompts movements; I am having difficulty following it. I realise that hill farmers and sheep farmers receive an area payment and that there is a sheep annual premium payment, but I do not understand how that encourages them to move animals about.

Mr. Drew: It depends on how the animals are counted and who counts them. We know that in certain parts of Europe—between the Republic and Northern Ireland, for example—sheep are moved to derive the benefits of subsidy. The figures may be exaggerated, but anyone who knows anything about that part of the world knows that it is notorious for such exploitation. The figures for the mainland may also be exaggerated, but the people I talk to lead me to believe that they are not. Some people make a living in this way, although I would much prefer that not to be the case. That is why I say that, until we can deal with the problem, we must be able to put restrictions in place.

I speak rather a lot about bovine TB, because it is an ever-present worry in my constituency. The linkage occurs, I am led to believe, inasmuch as some work that the expert group is undertaking is considering cattle-to-cattle transfer, which also depends entirely on how regularly cattle are moved, who buys them and which parts of the country they go to. Unless we acknowledge that we must have some restrictions in place, the worry will be not just foot and mouth, but other diseases that we must also face up to. There is room for compromise here. We need a more realistic figure, as eight weeks is unrealistic.

7.15 pm

Adam Price (East Carmarthen and Dinefwr): The hon. Gentleman is very generous in giving way. I tend to agree about the eight weeks and the drafting of the Lords amendment is unfortunate, but should not the Government introduce a compromise solution? I am

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sure he agrees that continuing a 20-day rule long into the future will render livestock farming in upland areas virtually unviable.

Mr. Drew: I agree. If I read what the Minister said correctly and given that the Government are trying to base their response on science, they are taking particular account of the Follett report, although they have also taken account of the Anderson report, which considered the practicalities. The Minister will no doubt come back on the point, but clearly he will consider the cost-benefit analysis, which will be principally a scientific evaluation. If and when it is possible to change the 20-day rule, let us change it, because it is causing my farmers some grief, although not to the extent of that faced by farmers in upland areas, even though such grief is part and parcel of how they earn their living.

I reiterate that we must keep learning from what went wrong until we can deal with the adverse consequences and we must have those protections in place. It may not be foot and mouth next time, but it could be something else. We must protect the people whom we want to keep in farming. They understand all that, even though they are finding it very hard in the short run.

Mr. Roger Williams : First, I draw the House's attention to my entries in the Register of Members' Interests involving livestock farming. It is a great pleasure to follow the hon. Member for Stroud (Mr. Drew), who was a fellow sufferer on the Standing Committee a long, long time ago, as well as a thoughtful and open-minded person about agriculture.

The Minister said that it is a great pity that the amendment was passed by the other place, but he will accept that it represents recognition of the despair and despondency in the livestock industry resulting from the continuing imposition of the 20-day rule. It is more than a year since the last confirmed case of foot and mouth and nearly a year since Britain was declared free of the disease, so farmers are concerned that we still have one of the most rigorous forms of control that they have ever experienced. They are concerned not just because such control causes them difficulty in running their businesses, but because the evidence on which the rule was imposed has never been made clear to them.

The Minister referred to evidence from the chief veterinary officer and other scientific advisers, but farmers always complain to me that there is no logic or rationale behind the 20-day rule, except, of course—we all understand this—that reducing the number of animal movements reduces the chance of disease being spread. Everybody accepts that and the fact that we cannot return to pre-foot and mouth times. There will be regulations and some form of control. As has been said, the NFU also accepts that.

Such is the absolute despair of farmers, particularly in the area that I represent, that 200 of them met one night last week in Brecon market and decided to travel down to the National Assembly the next day for a symbolic burning of licence forms and applications. Quite honestly, those farmers have plenty to do, so that is an example of the exasperation that they feel over the controls. They believe that there is a disproportionate burden on the livestock industry, because the risk lies not in the industry—this is foot and mouth-clear

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country—but at the point of entry at ports and airports.–[Interruption.] The Minister disagrees, although I am grateful for today's announcement by the Secretary of State that the Government will reconsider how responsibility is exercised by Customs and Excise. One authority would certainly achieve greater co-operation over intelligence to be used at such points of entry. Farmers still believe that the controls are disproportionate. That, for them, is the crux of the issue.

The hon. Member for Stroud talked about dealers. It seems to me that the main burden of such regulation is falling on farmers. Dealers often run large and sophisticated businesses. They operate from a number of locations and sites, and they also have a number of holding areas, so they can circumvent the 20-day rule without breaking it. The rule has little effect on their operation, although it has great effect on the family farmer. I shall give examples of how family farmers have found it difficult to operate.

Last weekend, I was approached by two constituents. J.W. Hammond and Sons is a farming business in my constituency, run by a man with his two sons and their families. They operate from a number of farms, but they have a well-integrated and sustainable method of production: they produce hardy ewes on one farm, and the lambs and breeding ewes are passed to other farms. DEFRA has told them that they must have only one holding, which means that when they buy stock for a farm that is 15 miles away from another they cannot move that stock. Because they have accepted DEFRA's advice, it is impossible for them to continue a well-thought-out and efficient operation that produces good stock. Unless the 20-day rule is changed, they will be unable to continue.

I was approached by another young farmer who had just taken on a tenancy. We want to encourage people like him to join an industry in which I think the average age is well into the fifties. He told me that because he had been unable to move 20 cattle, he would lose an extensification premium that was a key part of his cash flow and the profitability of his farm.

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