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Lord Redesdale: My Lords, under the best case scenario, if Saddam Hussein were to allow the inspectors to visit all sites and were to act in a co-operative manner, which he has never done before, can the Minister give a timetable under which sanctions could be relaxed and how accelerated that process could be?

Baroness Symons of Vernham Dean: My Lords, it is not the best case scenario, it is an only case scenario.

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It is important that we are absolutely clear on that. The UNSCOM inspectors must be able to go where they want and when they want. That is the only way in which Saddam Hussein will secure compliance. It will take as long as it takes. It will take as long as UNSCOM needs in order to be able to send reports to the United Nations that they are satisfied that they have rooted out all weapons of mass destruction in Iraq.

Lord Hardy of Wath: My Lords, perhaps I may join in the congratulations which have been offered to my noble friend and also concur with her assessment that the critical situation continues. But while it does, will it be necessary for a state of high alert to be maintained, for that of itself can be very demanding of Her Majesty's Forces? If that is to be ended at an early stage, can my noble friend say whether the inspectorate will begin its work with dispatch and determination so that the state of alert can be ended or restricted at an early stage? Would my noble friend care to comment, if possible, on reports that Iraq has already transferred technology and military production capacity to Sudan? Does such a link exist and are there plans to ensure that it is severed at the earliest possible date?

Baroness Symons of Vernham Dean: My Lords, the critical state of high alert will continue. We hope that the inspectorate will be able to begin its work as quickly as possible. Decisions on inspections are for UNSCOM and the IAEA alone. We have always fully supported their decisions. We wish to see the inspections begin again this week. My noble friend also raised the possibility that some of the technology for weapons of mass destruction may have been exported, notably to the Sudan. I believe that that matter has been raised in your Lordships' House before. It has been drawn to the attention of the relevant authorities. It is probably unwise for me to pursue that point any further other than to say that Her Majesty's Government have already taken it on board.

Baroness Trumpington: My Lords, as regards the Minister's reply to my noble friend Lord Marlesford concerning the briefing handed out in the House of Commons, why was it not given to this House at the same time? Is not the plain truth of the matter that the House of Lords was overlooked?

Baroness Symons of Vernham Dean: My Lords, as noble Lords will see, I am taking advice on this point from my noble friend Lord Gilbert. I understand that there were some technical reasons concerning timing. I hope that your Lordships are assured that my noble friend and I put our heads together on Friday, realising that the point that the noble Baroness has raised would occur to your Lordships very quickly and that your Lordships might indeed feel overlooked. Your Lordships have not been overlooked by my noble friend and myself. We shall do what we can to ensure that the briefing reaches your Lordships. If anyone feels a little

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miffed by not having the briefing, I apologise and say that the noble Lord, Lord Gilbert, and I will do what we can to put the matter right.

Lord Judd: My Lords, we are dealing with what must clearly be one of the most ruthlessly cynical regimes in history. Therefore, I join with all those who applaud the resolute, firm and courageous way in which the Prime Minister and others, and the Armed Services themselves, have been prepared to do what is necessary. My noble friend has said that the Government are convinced that any action we would have taken would have been legal. We know of the cynicism of the regime. If we have to maintain a state of readiness in order to do what is necessary without further warning, over a period of time the regime will certainly set out to destabilise the situation within the United Nations and the Security Council. Therefore, can my noble friend assure us that everything possible will be done to maintain the explicit support of the Security Council for the line that we have taken?

Baroness Symons of Vernham Dean: My Lords, I know that the legal basis for the projected action has been a matter of concern in your Lordships' House, and understandably so. We have discussed it on a number of occasions. It is important to remember that we are considering a highly complex network of United Nations Security Council resolutions. Perhaps I may remind your Lordships that there is Resolution 678 demanding that Iraq left Kuwait. There is Resolution 687, which set out the ceasefire arrangements, the position of UNSCOM and the necessity for Iraq to comply with it on an unconditional basis. There is also Resolution 1154, which concerns the memorandum of understanding with the United Nations Secretary General and which speaks of the severest consequences if that memorandum was broken. There is Resolution 1205, which speaks of the flagrant violation which the United Nations Security Council believes has been committed by Iraq.

I believe I have been very clear that Her Majesty's Government were not in any doubt that there was a clear legal basis for the planned military action at the weekend. Similarly, I give your Lordships an undertaking that any action taken by Her Majesty's Government in the future will be lawful. I am sure that Her Majesty's Government recognise the very important point made by my noble friend Lord Judd that it is enormously important that we do everything we can to keep the members of the United Nations Security Council as close to each other as we can in what I believe are bound to be some difficult days, and possibly weeks, ahead regarding this crucial matter of international stability.

Lord Thomas of Swynnerton: My Lords--

Baroness Ramsay of Cartvale: My Lords, I am sorry, but we have spent about 20 minutes on this matter.

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6.20 p.m.

Lord Donoughue: My Lords, with the leave of the House, I shall now repeat a Statement on additional aid to United Kingdom agriculture which is being made in another place by my right honourable friend the Minister of Agriculture, Fisheries and Food. The Statement is as follows:

    "Since I took up office as Minister of Agriculture, Fisheries and Food in July, my colleagues and I have had wide-ranging discussions with farmers' leaders and with working farmers around the country about the problems being faced this year and how we might reasonably address them. It has become clear that all sectors, but particularly the livestock sector, have been adversely affected by a marked deterioration in market conditions. The weather has made it difficult to grow adequate supplies of feed for the coming winter and to finish stock. In consequence, animals have had to be kept for longer than usual and are now coming forward onto an over-supplied market. The collapse of export markets in Asia and in Russia has exacerbated this situation, leading to further pressures on the United Kingdom market from supplies from countries which would otherwise export to those markets.

    "Within the constraints imposed by the common agricultural policy, the Government have already taken many steps to offer extra support to farmers. We paid £85 million in agrimonetary compensation to suckler cow and sheep producers at the beginning of this year. We supported the introduction of a European Union private storage aid scheme for pigmeat in the face of a fall of about 50 per cent. in the producer price of pigs. Additional action was taken in Northern Ireland.

    "We have relaxed the rules on the moisture content of cereals eligible for purchase into intervention, in recognition of the difficulties caused to cereals producers by the wet summer.

    "We successfully lobbied the European Commission to grant two blocks of private storage aid for sheepmeat to help move lamb on the market. With effect from 8th October we removed the obstacles to the export of whole sheep carcasses to France and, on beef, we have successfully negotiated the introduction of the export certified herds scheme in Northern Ireland and expect soon to see a partial lifting of the ban for Great Britain.

    "In addition, we have persuaded the Commission and other member states to increase beef premium advances from 60 per cent. to 80 per cent. for this year, thereby considerably easing farmers' cash flow problems. We have met the costs for one year of Meat Hygiene Service enforcement of controls on specified risk material from cattle and sheep; and we have met the start up and first year running costs of the new cattle tracing system.

    "I have had useful talks with the retailing sector, resulting in positive undertakings on origin labelling of meat, and on the welfare and feeding standards to

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    apply to purchases of meat, which will be particularly helpful to pig producers. I have also made representations to public sector purchasers of meat.

    "Not all these initiatives cost money, but those that have have in total been worth more than £150 million to the industry in addition to the ongoing support it receives from the CAP. But our discussions with industry representatives at both Ministerial and official level have persuaded us that more should be done to support United Kingdom agriculture in what are proving to be exceptionally difficult times. In recognition of these extremely difficult circumstances the Chancellor and Chief Secretary have, exceptionally, allowed me access to the Reserve for this financial year and I am grateful to them.

    "In the spring of this year, the Government drew down £85 million of agrimonetary compensation for the beef and sheep sectors. There remains the possibility of drawing on a further £48.3 million for the beef sector in the current year. I have asked officials to notify the European Commission today of the Government's intention to draw this sum and to make it available to producers on the same basis as the beef element of the spring package--that is, to suckler cow producers in proportion to their 1996 premium claims. I do not anticipate any difficulty in persuading the Commission to approve this arrangement. We expect the eventual rate of payment to be about £29.50 per head.

    "While these additional payments to the suckler cow sector will be of some help to hill farmers, the Government recognise that more needs to be done to help this fragile sector. We have therefore decided that, subject to approval from the European Commission, we should increase hill livestock compensatory allowances for the 1999 scheme year by £60 million. Though precise headage rates have still to be worked out, we estimate that, broadly speaking, this will allow us to put up rates across the board by about 55 per cent. As is normally the case, the vast majority of producers will receive the increased rates of allowances during February and March 1999.

    "In the longer term, the European Commission has proposed replacement of the hill livestock compensatory allowance scheme as part of a range of measures in the Agenda 2000 package to assist the rural economy. I intend to undertake full consultation with farmers' leaders and environmental groups on the shape of the successor arrangements.

    "On 29th July I announced the Governments intention to close the calf processing aid scheme when the obligation to run it lapsed on 30th November. We considered that the scheme was drawing too many calves from the market and squeezing beef producers' margins. However, the Government were asked to reconsider this by farmers who argued that, in the absence of an export market for British beef, closing the scheme now could have adverse consequences for the market.

    "We therefore encouraged the Commission to review the rate of aid payable under the scheme to fix it at a level which would attract the poorer quality

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    calves from the dairy herd while leaving the better quality calves from that herd and those calves from the beef herd to find their own price level on the market.

    "I am pleased to say that the Commission broadly accepted our arguments in this regard and will shortly publish a regulation fixing a special rate of aid for the UK under this scheme of 80 ecu--around 70 per cent. of the current rate. The new rate will come into force on the first Monday following publication of the regulation, either 30th November or 7th December. In view of this, we have decided to continue to operate the scheme for the remainder of the present financial year at the new rate. We will wish to keep the scheme under review with the industry. I know that maintenance of the scheme will be welcomed by dairy farmers.

    "This aid package for the livestock sector is worth some £120 million in 1999. In assembling it, the Government have concentrated on those areas to which farmers and their leaders attached the greatest priority.

    "We also need to think of the longer term future in announcing these measures. Government and all those associated with food production in the UK need to work co-operatively together to develop a blueprint for a successful, viable agricultural sector. This means in particular securing reform of the common agricultural policy. That reform must create the conditions to allow sustainable and competitive EU agriculture to operate effectively on world markets; it must reduce the burden currently imposed by the CAP on consumers and on taxpayers; and it must free up resources to offer scope for better targeted measures to support the rural economy and enhance the environment. That will mean significant changes in the way we support agriculture and require imagination, flexibility and enterprise from all those concerned.

    "My colleagues and I intend to undertake a thorough review, in close consultation with all interested parties, of the Government's long-term strategy for the rural economy. This will develop policies which offer a secure future for the rural areas. We shall over coming months consult widely on a range of issues. Trading conditions will remain tough in the months ahead, but I hope that this package and the commitment to generating a vision for agriculture will give the sector the boost it needs to face the future with confidence".

My Lords, that concludes the Statement.

6.32 p.m.

Lord Luke: My Lords, first, I welcome the Minister back on his feet. I hope that the cow which had the temerity to step on his foot has been well and truly de-boned!

I thank the Minister for repeating the Statement made in another place by his right honourable friend. We on these Benches welcome unreservedly the fact that at last the Government recognise that there is a crisis in the agriculture industry in the United Kingdom. During

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the past year there has been a very large drop in the income of virtually all farmers. We say that by far the most important reason for that lies in Downing Street and the overwhelming strength of the pound. The grain trade is recovering a little, but from a very low base. The incomes of some farmers are now lower than the minimum wage.

The first words in the Statement refer to the weather. Farmers know about the weather; no one is more expert on it. They must always discount the impact of the weather on their activities. It is other factors which sometimes they cannot cope with, notably the level of the pound. Why is there no mention of that?

The Government welcome, and so do we, a partial lifting of the ban on beef exports next week. What about beef on the bone? With regard to the positive undertaking on origin labelling of meat, that is emphatically not what the BRC said had been stated. Can the Minister clarify the exact situation, which is so vital to pig producers in particular? How much longer will the public unknowingly be able to purchase imported meat produced using methods which are illegal in Britain?

I welcome the Government's intention to draw down the £48 million outstanding in the EC account for the beef and sheep sectors, but why did they not do that earlier? While welcoming the Government's plans to increase the HLCA allowances for 1999, we are very worried about the future and hope that the Government will press our case with great vigour when discussing successor arrangements with the Commission. Dairy farmers will welcome the calf processing aid scheme extension, at least for the next few months, but, again, what happens next?

The package is stated to be worth some £120 million in 1999. That barely matches the underspend on the agricultural budget in the past two years. However, it is most welcome.

There are some glaring omissions in the Statement. Horticulture is always left out. Growth promoters are being used for soft fruit production--for example, pears--which are then imported into Britain under EC rules and sold in direct competition with British pears. Those growth promoters are illegal in Britain. What do the Government propose to do about that? Furthermore, there is no mention of poultry. What about honesty in labelling?

Like the curate's egg, the Statement is good in parts. However, much more needs to be done before the Government even begin to recover the confidence of Britain's farmers.

6.36 p.m.

Lord Hooson: My Lords, I thank the Minister for repeating the Statement. If a cow trod on his white-booted foot, I trust that suitable compensatory allowances will be made.

The Statement has been long delayed. The crisis in the industry has been apparent to anyone with any knowledge of farming for well over a year. It has become steadily worse and has reached the stage of a

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true depression. In particular, I welcome the suggestion that after due consultation the aid given to agriculture will be better targeted. I have lived in an agricultural community for most of my life. I believe that the smaller farmers have suffered the most. They do not depend so much on the subsidies as on the prices in the market. The main source of income for a farmer who has 4,000 sheep is the headage payment and not the final product. The aid needs to be better targeted.

Can the Minister deal with the problem that is troubling me? The Statement declared that the aid package for the livestock sector will be worth some £120 million in 1999. Is that the value of the additional aid package or the whole? Does it include, for example, the £48.3 million for the beef sector in the current year which is drawn down from the agrimonetary compensation? That is available only for this year, and not for 1999 so it cannot be added to the 1999 sum.

The Government can claim credit for increasing the beef premium advances from 60 per cent. to 80 per cent. for the year. That has helped farmers' cash flow problems. However, it is rich for them then to claim that they have met the cost for one year of the Meat Hygiene Service enforcement of controls and the start-up and first year running costs of the new cattle tracing system when they themselves imposed those costs on the agriculture industry. Therefore, in claiming that the aid package is worth some £120 million for 1999, the Minister must make clear how that sum is made up. Does it include what was drawn down in 1998? The Government must be completely frank about that.

It seems to me that the crisis is continuing. I am quite certain that the banks are holding back from foreclosing because if they foreclosed on many farmers it would have a domino effect and would be devastating for the country. I welcome the aid package, but it is long overdue. As the Minister and the House know, many Members of this House, including myself, have initiated debates here on the state of agriculture and it has taken a long time for the Government to begin to grasp the problem.

However, greater explanations are needed. We need further explanations of the headage proposals for the coming year. I do not begin to understand--and perhaps this can be explained to me--the proposed additional £60 million to put up the HLCA allowances by about 55 per cent. across the board. For example, there are 7 million ewes in Wales. I do not know how many there are in Scotland, but it must be many more. In England, there are more still in the hill areas. At the moment, I cannot see how that increase will put up rates across the board by about 55 per cent. Perhaps the Minister will explain that for me and, I am sure, for many other people.

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