§ 3.30 p.m.
§ The Joint Under-Secretary of State for Scotland (Lord John Hope)
I beg to move,That the White Fish Subsidy (United Kingdom) Scheme, 1959, dated 24th June, 1959, a copy of which was laid before this House on 25th June, be approved.
§ Mr. Speaker
Would it meet the desire of the House if we discussed this Scheme and the following four Statutory Instruments on the one Motion?
§ Lord John Hope
As the House knows, the broad purpose of the assistance which is given to the near and middle-water fleet in the form of building grants and loans and operating subsidies is to enable this section of the industry to modernise its fleet, which a few years ago, was almost wholly composed of old and obsolescent coal-burning trawlers. Substantial progress has been made, but there is still a long way to go.
What we all want to see is a prosperous fishing industry, but there can be no lasting prosperity in this or any other industry if the tools of production are getting old and rusty, in this case the fishing vessels themselves. Despite a great deal of new building, especially since the inception of the grants and loans scheme, there were still at the end of last year in the fleet no fewer than 200 vessels which had been built more than forty years ago. The aim of the Government's subsidy policy has been to facilitate the modernisation of the fleet by enabling some of the older, uneconomic vessels to carry on and so maintain supplies of fish to the housewife, while the new fleet is coming into being. The statistics show, I think, that we have succeeded in doing just this.
We are all anxious that this period of transition should not be unduly protracted. The subsidy was never intended to keep obsolete and inefficient vessels at sea indefinitely. So what we are trying to do is to maintain a balance between the run-down of the old coal-burners and their replacement by 214 modern vessels. Latterly, however, the scrapping rate has not kept pace with the rate of rebuilding.
The White Fish Authority has, in its Annual Report, drawn attention to the fact that in 1958, for the first time since the war, the numerical strength of the near and middle-water fleet was greater at the end of the year than at the beginning, although with the introduction of new and more efficient vessels we should rather have expected some contraction of the fleet. Indeed, in the eleven months since 1st August, 1958, when the current subsidy rates were introduced. only 35 vessels—17 in Scotland and 18 in England and Wales—have gone out. and there are still 257 coal burners in commission. I understand that about 20 of them have recently been laid up at Aberdeen.
These figures suggest that, at the present level of subsidy, owners are finding it possible to keep on a number of old boats rather longer than is desirable and, I believe, against the long-term interests of the industry. At the recent rate of scrapping the replacement of the trawler fleet by modern vessels will take another seven or eight years. The Government consider that that is too long. That is why, for the second year running, we propose to reduce the subsidy for steam trawlers. I want to emphasise that the cut we are making is not severe. The rate of cut varies according to the size of the vessel, from 5s. to 30s. per day and this represents an average reduction of about 7 per cent. in the present subsidies.
We are making this moderate cut-looking at it in some ways it may be too moderate—because we have taken into account that certain operating costs have risen, and because we also recognise that there is a danger that too sharp a reduction in their number could bear hardly on particular ports which depend very heavily on coal-burning vessels for their trade, and unemployment may be above the average. I know that this is a point which causes some hon. Members a good deal of concern, for example, in places like Aberdeen, Milford Haven, and North Shields, where there is still a high proportion of coal-burners in the fleet. Perhaps I can say a word about Aberdeen as I, personally, know the circumstances best there.
215 In Aberdeen, although the rebuilding of the fleet was slow in getting under way, substantial progress has been made, and I am pleased to note that more applications for grant and loan assistance have been approved for Aberdeen than for any other port in the United Kingdom. At the end of June there were 50 motor trawlers and liners fishing out of Aberdeen, and I understand that a further 30 are on order. During the past seven years 84 coal burners have been scrapped. The new diesels are, of course, more efficient than the old coal burners and, size for size, bring in more fish. Some contraction in the number of trawlers was to be expected and, in fact, has already amounted to 40 per cent. in Aberdeen over the same period.
Despite this, however, trawler landings at Aberdeen have risen by about 20 per cent. and the number of men from the Port of Aberdeen employed in fishing has remained steady. Since this contraction in the number of vessels in the Aberdeen trawler fleet has so far been accomplished with such little disturbance to the employment position of fishermen generally, the Government see no reason why the remainder of the transition should cause any serious dislocation. But, as I said earlier, we consider that some quickening of the pace is desirable to secure our objective of modernisation in the ten-year period for which grants and loans for new building were authorised in 1953.
Apart from this reduction of steam trawlers there are two other changes in the existing rates of subsidy which I shall mention.
The first affects oil-fired steam vessels built since 1952. There are only five of these vessels, all at Grimsby, all built with the aid of grants and loans, and, as the House was told last year, we feel that they should be treated for subsidy purposes in the same way as diesel vessels of the same size which receive no subsidy. As a first step, their subsidy was reduced by half last year with the intention of eliminating it entirely this year. However, as these vessels have been less profitable in the last year, we are not proposing to eliminate the subsidy immediately, but only to reduce it by half next year. It is still our intention, subject to a review of their opera- 216 tions, that they should thereafter be treated in the same way as their diesel counterparts.
The other change is to reduce from £6 10s. per day to £5 per day the subsidy for seine net vessels over 70 feet in length which normally make voyages of not more than seven days' duration. These vessels, I should say, as opposed to the last, are all Scottish, and our object in reducing their rate is simply to bring their rate into line with the rate which applies to motor trawlers of the same size and so to remove the anomaly of having different rates for similar vessels competing with each other. With the introduction of new types of gear, these vessels between 70 and 80 feet are engaging to an increasing extent in both trawling and seining, and they can change from one method to the other very easily.
I do not think that it would make sense to maintain the differing rates of subsidy for the two methods of fishing, but, in any case, we think that the circumstances of these relatively large and generally successful vessels in themselves justify the cut. The profits made in 1958 on average were, in fact, substantially higher than in the previous year and—having regard to the capital involved—compare favourably with those made by other sections of the fleet. So much for white fish.
As regards the herring fleet, we are not proposing any changes. Though herring fishing has been more profitable during the past year, we feel there is still a need, as there was when the herring subsidy was instituted in 1957 to arrest the tendency for boats to switch from herring fishing to fishing for white fish. Last year, the profits and earnings in this section of the industry showed some improvement which the Government welcome, and they hope that this will result in more boats taking part in this fishing. Of course, the virtual disappearance of herring from some areas is a matter of real concern. No one knows precisely why it has occurred and, as hon. Members know, the Government are devoting great efforts, through their scientists, to elucidating this problem in conjunction with the other countries concerned; but I should say that the fishermen themselves often have as much to do with the level of landings as the herring, and a large fleet will almost always catch 217 more than a smaller fleet. The Government, therefore, hope that more boats will go in for herring fishing. Despite the general decline, fishing has been quite good off some parts of the coast, and recently off the Buchan coast and off Shetland, good catches have been made.
We estimate that the total cost of the white fish and herring subsidies in the coming year, on the basis of these proposals, will be about £2¾ million, as compared with £3 million in the current subsidy year. We expect that by the end of the current subsidy year we shall have spent on these subsidies about £15¾ million of the £17 million authorised by the White Fish and Herring Industries Act, 1957, so that the unexpended balance will be insufficient for the needs of the year ahead. The Act, however, provides, that the limit of £17 million may be raised to £19 million, with the approval of the House, and the purpose of the Aggregate Amount of Grants Order is to authorise this additional £2 million so as to provide sufficient funds for the period covered by the subsidy schemes we are now discussing.
This £2 million will not cover our needs much beyond the end of next subsidy year, and it is the intention of the Government to introduce legislation next Session to provide additional funds. As the House knows, the Committee of Inquiry, under the chairmanship of Sir Alexander Fleck, is looking into the whole question of the future of the fishing industry, in the light of the Committee's Report, the Government will decide whether financial assistance to the industry should be extended beyond the periods authorised by the 1957 Act. In the meantime, our intention is to continue the white fish and herring subsidies on their present basis, subject, of course, to such variations as may be made as a result of the reviews which take place annually.
The remaining two Statutory Instruments before the House affect the other side of the Government's assistance to the industry, namely, the grants which are made towards the construction of new vessels. These amending Instruments increase the maximum grant which may be paid from £30,000 to £37,500 in the case of white fish vessels and from £15,000 to £17,500 in the case 218 of herring vessels. These increases are intended to take account of the increases in building costs which have taken place since the ceilings were fixed in 1956 and to ensure that the same degree of assistance is given as when grants were first introduced in 1953. This should be of real help to the industry and is something that it was most anxious to have.
I commend these Statutory Instruments to the House and I hope that hon. Members will welcome them as the means of maintaining in the coming year the encouraging progress that has already been made towards the modernisation of the fleet. I am certain that hon. Members on both sides will agree that what we want is an efficient and competitive industry and that this must be the objective of our policy.
§ Dame Irene Ward (Tynemouth)
On a point of order, Mr. Speaker. May I ask if, when the Question is put, the various Statutory Instruments are to be put separately, or as one?
§ Mr. Speaker
Each of the other Statutory Instruments will have to be moved separately afterwards, but discussion on all the five Instruments can take place upon this Question which is now before the House.
§ 3.47 p.m.
§ Mr. Edward Evans (Lowestoft)
I am sure that we are grateful to the Joint Under-Secretary for his very lucid exposition of the plans of the Government for loans and subsidies, but I must say that it was not a very convincing statement and that it will not satisfy many hon. Members on either side of the House.
First, may I say that all hon. Members concerned with the interest of the fishing industry, certainly my right hon. and hon. Friends, are gratified that the Government have at last acceded to the repeated demands of all of us who have taken part in these debates in past years that adequate time should be given to consideration of these Statutory Instruments, and at a reasonable hour. This is the first time for some years that we who have taken part in these debates have had an opportunity to approach these important matters at an acceptable time, with the prospect of being able to deal at length with a subject which affects our interests so vitally. I 219 remember well that last year the Minister rose at two minutes before midnight, an unconscionable hour to move such a Motion, and that I left the building at a quarter past two. So we are grateful for the consideration which has been given to our complaints and I hope that this will be an augury for the future.
Having said that, I wish to register a protest, which, I have no doubt, will be supported by hon. Members opposite, at the restrictions which must inevitably be placed upon us in considering the wider interests and problems of this industry this afternoon. Our debate is concerned with examining the Instruments before us dealing with grants and loans for the building and conversion of vessels and with the subsidies for trawlers and herring drifters operating in inshore, near and middle waters. In considering the tremendous scope of the fishing industry, these play an important but not the whole part of our fishing activities. There is a wide range of interest which should be debated, but it would seem that we are never likely to get time to discuss them.
We dare not mention this afternoon the Icelandic trouble, the attacks on our trawlers and the dangers they run, or the Faroese Agreement, the general question of fishery limits, the over-fishing of certain waters, the general question of the conservation of stocks, or the disastrous falling off of herring fishing, particularly the great East Anglian autumn herring fishing. These are very serious problems, Mr. Speaker, but you will note that I am not discussing them—I am just mentioning them. We have no real opportunity of discussing the last conference at Geneva, or the vital importance of the next conference. The vexed question of quotas is barred and I suppose I must not say anything about processing, deep freeze, canning and animal foods.
The operations of the Fleck Committee are to remain shrouded in mystery. Worst of all, and this is almost unbelievable, we have not had, nor can we have in this debate, a discussion on the Reports of the White Fish Authority and the Herring Industry Board. We have not even discussed last year's Report and we have no opportunity of discussing this year's. I appreciate the value of these Reports. They are extremely able documents and 220 it really is a tragedy that we never have an opportunity to say anything about them except incidentally.
I say quite seriously to the Government that it is time that we had a full debate on the fishing industry. We should not hide behind these Instruments to gag one of our major industries. The Government dare not do this to agriculture or mining, the other two industries which develop and exploit the natural resources of our land.
There seems to be a view prevailing in some fishing circles, and, indeed, in the House, among some hon. Members, that the inshore, near and middle-water sections of the industry play but a minor rôle in the fish production of the country. That is not so, as I will strive to show later by the relative figures taken from the White Fish Authority's Report. The Secretary of State for Scotland, during the Second Reading of the White Fish and Herring Industry Bill, on 20th January, 1953, used these words:… without adequate rebuilding and with scrapping going on, the future of the fleets is obviously in grave danger. They must not be allowed to sink to too low a level. The inshore, near and middle-water men provide the best quality and greatest variety of our fish, and these cannot be replaced by imports. If we are to have the best quality fish for human consumption in this country, we must retain our inshore and near and middle-water fleets. I am afraid that at present prices capital is not forthcoming for the rebuilding of these fleets."—[OFFICIAL REPORT, 20th January, 1953: Vol. 510, c. 53.]Note the phraseThe inshore, near and middle-water men provide the best quality and greatest variety of our fish, and these cannot be replaced by imports".Britain, in spite of its maritime traditions, is not a great fish consuming community, although, latterly, there is a growing tendency on the part of animals to eat more fish, if we judge by looking at advertisements, particularly those on television. I am glad to see that someone is eating fish. To cultivate a taste for fish it is essential that quality and variety should be maintained. These are very largely the products of the inshore, near and middle-water fishermen. They are, as we all know, sole, plaice, turbot, halibut, hake and haddock, to name only a few.
The proportion of fish caught in 1950 goes in this ratio: from distant waters, 221 45.2 per cent. to the value of £22¼ million; near and middle waters 31.4 per cent. to the value of £18,800,000; inshore, 14 per cent. to the value of nearly £6½ million. This shows that just over half the total catch by British vessels, ignoring the foreign imports landed in this country, come from inshore, near and middle waters and more than half the value by over £2 million.
The tonnage of landings is almost equally divided. I say this to emphasise the importance of this great section of the fishing industry—the Instruments which are being laid before us today relate to its prosperity—and to illustrate what an important element the smaller type of vessels constitutes in the economy of the whole industry. There is also the immense contribution to fish supplies by the herring fleets, although their returns, in spite of what the hon. Gentleman said this afternoon, during the past three years have been tragically disappointing. How can he take such a complacent view about the position of the herring industry today?
We all know that the costs of reconversion are steadily mounting. There is a desire to build larger boats. They are more economical and better deploy their manpower. They provide, of course, better amenities for the crew. Some of the older vessels are utterly out of date in amenity standards and on that ground alone ought to be scrapped. Today's costs soar into the region of between £120,000 and £150,000 whereas, before the war, one could get a tolerable vessel of the same kind for about a quarter of that sum.
To be fair, the Government have realised this and have proposed to raise the maximum grant from £30,000 to £37,500 for trawlers, and a corresponding sum for herring drifters. The industry contends that this is not enough. It is reinforced by the opinion of the white fish authority, which suggests raising the figure to £40,000. Even then, it leaves a huge sum to be provided by the owners, and the tragedy of this is that the small man, or the small family concern, will find it almost impossible to provide the rest of the capital required, which is an enormous sum.
One quarter of £120,000, is a valuable grant, but for the small firm to provide 222 the rest is quite impossible these days. This means that there must be fewer small undertakings able to operate, and the industry must inevitably fall to fewer owners and into the hands of large companies, where there is a tendency for a monopolistic character of the industry. We do not think that this is a satisfactory development in an industry which prides itself on a strong competitive individualism.
In finding the necessary capital for new vessels the position is aggravated by two important factors. One is the tremendous fall in the price of scrap. In these debates a few years ago we used to say, with a great deal of reason, that the returns from scrapping three old vessels, with the grants and loans then available, would provide the capital for a new ship. Today, the price of scrap has dropped, I am told, until it would be necessary to scrap six or seven old vessels, and some say even more, to get the same return in cash.
The White Fish Authority points out what would be the effect of raising the maximum grant to £40,000, not the £37,500 on which the Government have decided. Incidentally, the Government have not yet given a reason for that discrepancy and have not explained why they disregard the views of the White Fish Authority, the statutory body set up by the Government to advise them. The White Fish Authority points out that raising the grant to £40,000 would bring the grant back to the original intention—not a rigid intention—envisaged at the beginning of a 25 per cent. grant.
I note that just on £6¾ million has been given in grants. When we compare this with the huge sums available for agriculture—of which I make no complaint, unlike my famous namesake in the House, whose views I do not follow in this matter—it shows that the Government have not been over-lavish in their generosity.
Another cause for anxiety and a source of much irritation is the amazing fluctuation in the interest rates on loans. The amount of loans granted to date is about £16¾ million. Incidentally, I find it difficult to reconcile the figures in the White Fish Authority's Report with those kindly furnished to me by the Minister in an Answer to a Question which I put to him some time ago. There 223 seems to be some discrepancy somewhere. It may be that we have confused our dates.
These loans have been operated at no fewer than eighteen different rates of interest since 1953. If hon. Members look at Appendix VI of the Report of the White Fish Authority they will find that in August, 1953, the rate of interest was 4½ per cent.; in October of the same year, 4¼ per cent.; in June, 1954, 4 per cent. In 1955, the figure rose to 4¼ per cent. and in July, 1955, to 4½ per cent. The rates of interest rose and rose until we reached the catastrophic result in 1957 of a rate of interest no less than 6¼ per cent., since when it has dropped a little.
This puts the owner and the contemplating buyer of a new vessel in a most invidious and difficult position. He contracts to build a vessel to a certain price at a certain rate of interest, but before he has proceeded very far he finds that, through circumstances over which he has no control—Treasury policy, Government financial policy, or whatever it may be—the rates of interest have increased alarmingly and he is saddled with a new rate of interest, which he had not contemplated, for possibly up to twenty years. That is a disability which very few undertakings can foresee and with which very few of them can cope. An outstanding example of this occurred when, owing to the financial crisis of 1957, interest rates rose to the highest ever level of 6¼ per cent., whereas in 1954 the rate had been 4 per cent.
The industry considers that this state of affairs is contrary to the spirit underlying the introduction of loans and grants and that ways and means should be provided of ensuring that owners do not have to pay interest at rates much higher than those in operation when they negotiated the loans. The industry also suggests—and this is a very constructive suggestion on its part—that they should be enabled to raise a new loan from the Authority to pay off the old loan if the interest rates subsequently fall.
When the loans scheme was started short-term rates of interest were below the Bank Rate and long-term rates were very near it. Why the change of policy? Today, the rates are higher than the Bank Rate. Is it because the rehabilitation of the near and middle-water fleets 224 has to have secondary consideration to monetary policy and the dead hand of the Treasury has to prevail? This is not what Parliament intended when it decided that the major consideration was the rehabilitation of the fleet.
Another source of irritation is the charge by the White Fish Authority of ½ per cent. over and above the Authority's borrowing rate from the Treasury. This is for administrative charges and to make a reserve for bad debts. Surely the large sums derived from the levy which is taken on all fish landed in the country should be enough to run the White Fish Authority. Why should the good borrowers be responsible for the bad borrowers? This seems to the industry, to my hon. Friends and to myself a most unfair imposition, and I hope that the Minister will bear this complaint in mind, will bear in mind the high interest rates prevailing over many years and will see what can be done about them.
I will leave the special problems of inshore fishing to steam vessels to those more competent to deal with them. I see an imposing, almost a formidable, array of Scots and Cornishmen here today, and they are much more concerned with this problem than I am, and, I am sure, much more knowledgeable about it. I have the privilege of representing in the House the Port of Lowestoft, where we have undertaken a most comprehensive scheme of reconversion. We have now the most modern fleet in the country, with only one steam vessel operating.
When I turn, as I do now, to the question of subsidies. I want to make only one general observation on the question of the steam trawler. It seemed to me a most unrewarding policy when, a few years ago, the subsidy for steam vessels was raised so as to prove a distinct disincentive, I thought, to conversion at that time, and then, last year and this year, was reduced so as to make the operation of these vessels almost wholly uneconomic. I remember saying in the debate then that if I were the owner of a steam vessel, and had a subsidy of £20 a day, the last thing I should want to do would be to convert that vessel to a diesel vessel, which received nothing like that amount of subsidy. I do not want to impinge on that topic today, however; I am just mentioning it.
In discussing the subsidy rates now proposed, I should like to say a word 225 about the herring industry. Everyone knows that this is one of the most difficult problems in the fishing industry today. I speak with much feeling on this topic, because Lowestoft, with Great Yarmouth, is the combined centre of the great East Anglian autumn herring fishing, the decline of which, over recent years, has been catastrophic. I see that the hon. Member for Yarmouth (Mr. Fell) is here, and I am sure that he feels the same anxiety as I feel about this.
Time will not permit me to go into the causes of the decline, but one major factor—and I have said this in the House many times—is the indiscriminate trawling for immature herring in the lower North Sea by the Danes, Belgians. Dutch, Germans and even the Poles—and I am not sure that the Russians are not in it, too. I have been consulting practical men who have fished these waters for many years. I know that some hon. Members opposite do not agree with me entirely about this, although I think that they would go a long way with my argument.
In discussing the scientific aspect I have only to mention the name of Dr. Hodgson, former head of the Lowestoft Marine Laboratory, who supports me in thinking that it is not a question merely of millions of immature herring being taken—herring too young to breed—but a question of millions of millions. They are scooped up from the bed of the ocean to be converted not into human food, but into fish meal. The herring is a pelagic fish which is caught, when mature, on the surface of the sea by drifters using the long-reaching drift nets.
The past few seasons have been calamitous, particularly for the East Anglian herring fishing. The hon. Member spoke about the prospects for herring. May I quote from the Report of the Herring Industry Board. Referring to herring fishing, it reads:The fishing was quite the most disappointing in all its long history. Landings totalled little more than half those of the previous year—itself an exceptionally lean one. From the viewpoint of catches, the only redeeming feature was that prices reflected the state of scarcity and enhanced unit earnings went some way towards making up for the smallness of the catches.I quote that with reference to the Government's proposal—despite the difficulties 226 that the herring industry is experiencing—to retain the same standard of subsidy, and I ask them to look again at the subject, and to consider whether they cannot do something far more helpful for the industry.
If this decline proceeds we shall see fewer and fewer vessels in the business, and a once prosperous industry go further into trouble. Already, the number of vessels is the lowest on record. One result will be that with the poor return shared by the crews it will be virtually impossible to recruit the men necessary even for the small number of drifters now going to sea. There is already a tendency for driftermen to go into the trawl business, because there they get a share of the subsidies, while the men's share of the earnings of the drifters is so low as to make it absolutely essential that they should look for other employment. I urge the Government to look again at this and, if not now, at least in a few months, to bring in another scheme.
In discussing the subsidy figures for the near and middle waters, I want now to present some figures that I have collected for my own port. These are typical of many other ports engaged in near and middle-water fishing. As I have already said, I exclude inshore fishing, because those concerned in it do not present their accounts in the same form. In presenting these figures, I want the House to realise that they are compiled, audited, checked and approved by the Ministry's officials.
Before I go into details the House should know that it is agreed with Government officials that the cost of running motor vessels during the next twelve months will increase by 2.7 per cent., and that the estimated decline in earnings will be in the region of 2½ per cent.—yet the subsidy is to remain the same. The industry, in these circumstances, and justified as it is by the figures agreed with the Government, proposed a new scale. This was the scale submitted to the Ministry not so very long ago. It is proposed that for vessels of 70 ft. to 80 ft. in length the present £5 should be raised to £7 5s.; 80.90 ft. from £6 to £9 15s.; 90.100 ft. from £11 to £14; 100.110 ft. from £8 10s. to £13 10s., with other, smaller, amounts as the length of the vessel increases.
227 That claim, made by the industry itself, is based on actual earnings and, as I have said, those earnings are agreed by the Government. At present, all the fleets have shown a loss, and I have here some figures to illustrate how the fleets are operating at the very moment when the Government are considering these subsidies. I know that this looks a most formidable document, but I do not propose to go right through it. It shows that in 1958, on vessels 70–80 ft. long, there was an average loss of £603 on each vessel. For vessels 80–90 ft. long, the average loss was £219; 90–100 ft., £57, and 100–110 ft., an average loss of £34. Whoever prepared this sheet has very optimistically headed the column "Average Net Profit and Loss" but there was no profit at all. The Government ignore those figures, and retain the subsidy at its present level.
Another thing that the industry does not like is the fantastic allowance of only 6⅔ per cent. for depreciation. That allowance applies to vessels that go to sea every day, in all sorts of weather, all the year round. Their machinery is operating all the time, unless they are in port—and even then it is working in a moderate way. Yet depreciation on such vessels is calculated at 6⅔ per cent. The depreciation allowance on office furniture is othen much higher than that. There is no realism about such a percentage. It should be drastically reconsidered and a reasonable figure allowed. Again, in calculating subsidy, the charges for interest are not allowed at all.
This great industry deserves more consideration. It is a vital part of our economy and those in it often face great risks and hazards that are often wholly beyond human control. I urge the Government to take back these Statutory Instruments and to come back with new ones before 31st July. I can assure the Government that if they bring back a more realistic set of figures we on this side will do our utmost to facilitate their passing.
§ 4.15 p.m.
§ Sir William Duthie (Banff)
I join with the hon. Member for Lowestoft (Mr. Edward Evans) in expressing relief and gratitude for our being able to have this debate at such a reasonable hour. It is 228 an entirely new experience to have a debate on the fishing industry without midnight chiming. Nevertheless, as these Statutory Instruments come into effect on 1st August, we are given very little time to make up our minds about them. It means that we have either to accept them or go without.
In the main, I want to discuss white fishing and herring fishing, though, later, I want to say a few words about near and middle-water trawling. However, I hope that all those hon. Members whose constituents are engaged in near and middle-water trawling will deal in detail with the difficulties that confront those localities, because the presentation of these Schemes and the Order gives us the best opportunity we have had for a considerable time to debate the industry.
One consideration that is in the minds of everyone concerned with the industry at present is when we may expect the report of the Fleck Committee. On 15th June, 1957, the then Minister of Agriculture, Fisheries and Food—now my right hon. Friend the Chancellor of the Exchequer—informed us that the Committee was to be set up. I remember that when, in the subsequent month the prototypes of these present Statutory Instruments were discussed, we were asked to pass them because the Fleck Committee was being brought into being to survey all facets of the industry.
That was two years ago. A year ago we asked for an interim report from the Committee so that we might know just how things were shaping, and what warranty, if any, there was for the Statutory Instruments which were then before the House. Another year has passed. Some vital changes are now appearing in the subsidy structure, and again I feel that in the absence of the Fleck Committee's report there is far too much groping in the dark without any real warranty for the changes that we are asked to agree.
I have had consultations with the Inshore White Fish Producers' Association of Scotland, which looks after the interests of the greater part of the inshore fishing. It deals with 420 to 430 vessels, which have about 2,500 fishermen in their crews. The committee of this organisation feels, as I do, that we are now being a little precipitate in making 229 any change whatsoever in these subsidies. It is true that there is a standstill on the subsidies applicable to vessels under 70 ft. A perfectly good case can be made out for very greatly increasing subsidies up to Is. per stone and where, as in vessels over 70 ft., there is a reduction from £6 10s. to £5 per day, there should be a standstill.
I now ask hon. Members to consider the earnings for last year in the inshore white fishing industry. These figures come from the Scottish Office. They are not manufactured by any association and, presumably, there is no bias about them. In vessels under 40 ft. the average wage was £9 4s. 9d. a week. In vessels from 40 ft. to 70 ft. the average wage was £12 18s. per week. In vessels from 70 to 80 ft. the average wage was approximately £16 per week. The average skilled worker's wage on shore is £13 5s. 5d., but it must be borne in mind that the seine net fisherman works 80 hours per week, which is almost twice the number of hours worked by skilled men ashore
Details of other costs make very illuminating reading. Running and gear expenses are up. Net profits are more or less constant. The profit coming from these inshore and herring vessels is not a business proposition to the owners, in view of sundry considerations mentioned by the hon. Member for Lowestoft, such as depreciation.
There is a reduction in the subsidy to be granted to vessels over 70 ft. The contention is that such a vessel may be trawling instead of seine netting and, in consequence, the seine netter must be put on all fours with the trawler of the same size. Surely a little supervision can get over that difficulty. If a ship has not a gallows, she cannot trawl with an otter trawl. There is a certain amount of honesty among fishermen but, even though the master does not declare that he is using a trawl, by an inspection of the ship that fact could easily be ascertained. That excuse is not a very good one.
In computing the earnings of inshore fishermen it is curious that, in arriving at the figures whereby the subsidies are reduced, loan interest is not permitted as a costing item. It should be. The Inshore White Fish Producers' Association is today accepting these figures under protest, with the hope—it is a hope that has been somewhat deferred, and the heart 230 of the industry is becoming a little sick—that a certain amount of equity will be achieved when the Fleck Committee's report is published and applied.
What is the position of the White Fish Authority? What about the White Fish Authority's small ports scheme, which seemed an excellent measure? How many recommendations has the White Fish Authority made in the last twelve months and how many of them have been improved? There is a feeling throughout the whole industry that the position of the White Fish Authority has been completely usurped by the Treasury. There is a very considerable amount of evidence to support that.
The herring industry is declining. There are fewer vessels and fewer fishermen. That is not to be wondered at, because there is the lure of the seine net, where there is a weekly settlement and where the average earnings are greater. We are allowing a certain amount of rot to creep into the industry. We, as a nation of fishermen—and, I submit, the Government—have ourselves to blame.
I hope that I am in order in mentioning some of the considerations which make the herring industry such an object of pity. There was an article in the Scotsman yesterday entitled, "Disappearance of the Herring". I commend that article to all those who are interested in the fishing industry. It is one of the best informed documents that I have ever read on the disappearance of the herring. It marshals facts in a very telling way. It underlines in no uncertain way how little we know about the herring industry and the habits of the herring. It is demonstrated in the article, as one already knew—and here I must join issue with the hon. Member for Lowestoft—that our own scientific opinion in this country is quite at variance.
In Lowestoft, it is submitted that the causes are man-made. In Torry, near Aberdeen, the Research Department says that it is the result of natural causes. Since I entered the House of Commons I have in my own way endeavoured to preach that natural causes are the true reason—namely, the plankton-bearing ocean currents and the like. We do not know, and we are playing at research. I ask hon. Members to bear in mind the large catches 231 of herring on the West Coast last winter, which saved Scottish fishermen from ruin after the dreadful time in East Anglia. Obviously, there was plenty of plankton there for the herring, which all goes towards supporting the contention that ocean currents are changing in so far as the eastern and western ports are concerned.
Another matter of great interest and importance to herring fishermen is the increase of continental fleets. The Scotsman of 23rd June carried a very well-informed article entitled, "Expansion of Soviet Fisheries". I commend that article also to everyone interested in the fishing industry. The manner in which the Russians are developing their fishing industry is well worthy of note. By 1965, they will probably be the largest fishing nation in the world. They are setting about it in the way in which we should. They send their vessels out in units of ten or twelve drifters or trawlers with a depot ship, and in every instance a research vessel accompanies the group. They are alive to all phenomena and all conditions. They learn on the spot anything which is to be learned.
I strongly commend that to the Government, because, in this competitive world, without research in the fishing industry we shall not get anywhere. We must discard many of our present-day methods. We must find new gear and new methods of fishing. It is very important that we should find new fishing grounds, because these continental fleets are finding fish. They are going after white fish and herring as well and they are finding the fish, whether it is 200 miles west of the Hebrides or 100 miles north of the Faroes. They are finding fish, and it is up to us to do the same.
The trawl is no doubt wreaking a good deal of havoc in the North Sea, but there are natural forces perhaps just as destructive as the trawl in the North Sea. I refer to dog fish and all the other creatures which prey upon the herring.
I agree with what the hon. Member for Lowestoft said about interest rates. In many instances interest rates are far too heavy a drag upon the industry. As a businessman, I think that ½ per cent. surcharge, ¼ per cent. for administrative costs and ¼ per cent. for bad debts, is entirely iniquitous. The industry should not be 232 asked to bear that additional charge. Interest rates should be geared entirely to the Bank Rate.
With regard to coal burners, I have every sympathy with those ports now meeting the added menace of reduced subsidies. I know how difficult it has become to replace these vessels. It is all very well to speak about a four-year or six-year plan for the replacement of vessels, but we must take conditions as they come to us year after year. We must not overlook, for example, the price of scrap or the rising cost of vessels. We may raise the ceiling of the original grant, but the balance of 75 per cent. of the cost has to be met out of cash reserves or from earnings. Until earnings are sufficient to pay a reasonable yield and to allow the building up of reserves, it is fatuous to engage in the industry. This applies equally with small vessels as with big ones.
The fishing fleets are a national asset, as essential in peace as in war. That has been demonstrated conclusively in two wars in my lifetime. For safety's sake, we require the strongest possible fishing fleet. It is a cheap form of insurance for national survival. It is wrong that we should have subsidy changes without the Fleck report to warrant changes. If, tonight, there is a Division on these Statutory Instruments I must vote for them, because I cannot see the fishermen whom I represent going without subsidy as from 1st August. I appeal, however, to my right hon. Friend the Secretary of State for Scotland, even at this eleventh hour, to reconsider what he is doing now and let us have a standstill all round.
§ 4.32 p.m.
§ Mr. James H. Hoy (Edinburgh, Leith)
I listened with interest to the appeal made by the hon. Member for Banff (Sir W. Duthie). It is wrong of the Government to tell the House that there is nothing they can do about the fishing industry until the Fleck Committee has presented its report while, at the same time, they introduce today's Statutory Instruments, which make substantial cuts in the subsidies paid to the fishing industry.
It is just a little glib of the Joint Under-Secretary of State for Scotland, in introducing the Schemes, to say that all that the cut amounts to is 7 per cent. Let me remind him that 6⅔ per cent. represents the amount of depreciation on the 233 boat itself. Therefore, when we talk of a cut of 7 per cent. in the subsidy for the fishing industry, we are talking about a substantial sum. It certainly might appear to be very little if we were discussing agriculture.
I was more than a little interested this afternoon to hear the various theories concerning the disappearance of the herring from the fishing waters. In the old days, there used to be a simple Answer, which I have recalled to the House on a previous occasion. Shortly before the hon. Member for Fife, East (Sir J. Henderson-Stewart) became Joint Under-Secretary of State for Scotland, he thought that the whole responsibility for the disappearance of the herring from the fishing waters was the return of a Labour Government. Apparently, nobody has yet told the herring that we have a Tory Government, because the fish have never come back.
We now hear theories postulated about the reason for the disappearance of the herring. All I can hope is that somebody will find the answer. I support, however, the theory put forward by my hon. Friend the Member for Lowestoft (Mr. Edward Evans) rather than the theory that comes from Northern Scotland. My view is that the trawling is doing considerable harm. Indeed, this raking of the sea-bed is bound to have an effect in following years.
The Joint Under-Secretary argued that boats were not being scrapped as quickly as in the past and he said that the 1958 figures proved this. What he apparently did not take into account, however, was that in 1957 the interest rates on money to buy the boats went up to the highest figure ever. It becomes rather uneconomic if those who have to build new trawlers of moderate size costing £120,000–£140,000 are then faced with interest charges of 6¼ per cent. compared with 4 per cent. That, undoubtedly, has had an effect on owners who were considering providing new vessels. The Government will not encourage them if they put up the interest rate, reduce the subsidy and think that this will provide a solution. I know that we all want to get a solution. Therefore, I shall make one or two suggestions as to how we might more quickly modernise the fleet and get rid of the old vessels. That, I take it, is the objective that we all wish to achieve.
234 Unlike agriculture, which goes on receiving subsidies of about £240–£260 million a year, the fishing industry receives only £2 million. Those of us who are interested in the fishing industry must face the day when even these subsidies cease altogether. There may be many methods of reaching that position. Agriculture, apparently, will go on for ever receiving these tremendous sums from the Government. The cotton industry is to receive something like £30 million. Indeed, I notice from today's Press that the cotton industry is to have three systems of payment: one for capacity that is being taken out of industry, the second for industry that is scrapped, and the third for those who cut down the number of machines. Indeed, so generous are the Government concerning cotton that they are prepared also to give a bonus of 5 per cent. to those who send in their applications for the cash by 31st August.
When we contrast that kind of treatment with what is being meted out to the fishing industry, I cannot understand why hon. Members accept it with such equanimity. One of the reasons—let us face it—may be that frequently the industry has not made up its mind exactly which way it wants to go. Indeed, as each year comes round, it tries always to extemporise to meet the situation when it might much better spend its time thinking out what it wants to do and what size its fleet should be.
Three years ago, in a similar debate, I made the suggestion that if there was to be a real interest in fishing and if it was to be successful, the industry should be planning, together with the Government, what its future rôle should be and that we should go in for a considerable number of distant-water trawlers, middle-and near-water trawlers and seine netters, and that we should decide how many were required to meet our needs. Until we do that and make up our minds where we want to go, we will be in these difficulties year after year.
It is also in the fishing industry that one finds other difficulties. One port will want greater subsidies for coal and for a longer period. Indeed, that is the position facing Aberdeen today. Everybody will agree that it is the one port where any substantial cut in coal subsidies would have a tremendous effect. At other 235 ports where owners have modernised, the attitude is that that is no concern of theirs and that they would much rather have greater grants for rebuilding and that the one thing which they do not want is a subsidy for scrapping, since they have scrapped all their old boats and do not think that one port ought to get what they did not get in years gone by. They will agree to a policy of subsidies for scrapping only if the Government make it retrospective. That is about the only way which would appeal to them.
Then we have the other suggestion from the British Trawl Owners' Federation itself, which is that the maximum should be raised to £40,000 rather than £30,000. Here the Government behaved in a most niggardly way. Instead of agreeing to increase the maximum to £40,000, they made their niggardly proposal to increase it to £37,500. Why are right hon. Gentlemen so mean in such a small thing as this? The Government could have created a great deal of good will by acceding to this demand for a maximum of £40,000—and there is a very good case for removing the ceiling altogether.
The fleets fishing from Granton and Leith, the ports I represent, have their own special difficulties, as has been admitted by the Scottish Office. I do not want to go over the figures of earnings, profits and losses, which are well known to and admitted by the Scottish Office. Until 1956, we always had special subsidies to meet the special difficulties of Granton and Newhaven, where we had to box fish because there were no quayside facilities for selling. That added considerably to the costs of trawler owners at those ports.
That was admitted by the Scottish Office until 1956, when that subsidy was wiped out. Trawler owners from those ports now have this very heavy additional cost which is not met by any other port and which is one more of the burdens which they have to carry. I do not know whether the Government are now suggesting that the trawler owners should clear out of these ports, but that appears to be the case, and the Government had better make a statement quickly about what they want those ports to do in the future.
236 We feel that the subsidies should be considerably altered and that there should be quicker replacement of vessels. We have certain schemes and have suggested to the Government that where the owners are receiving subsidies for old vessels, even a yearly subsidy might be paid in the form of a lump sum, which would help in the building of new vessels. My hon. Friend the Member for Lowestoft said that under existing conditions scrapping six trawlers would pay for the building of one new trawler, but I think that to scrap six old trawlers meets the laying out of the 15 per cent. down payment for the new trawler.
I was interested in the suggestion about interest payments. I raised this matter very forcefully three years ago and suggested to the Government that not only should the interest rate be fixed on the day of order, but that the Government might consider special terms for meeting the needs of those who were to build. I suggested that the period for depreciation allowance should be cut from fifteen to ten years. All these suggestions have been made and one can only hope that the Fleck Committee will deal with them. Under the circumstances, I would have expected that the Government would have done the industry the courtesy of waiting to see what the Fleck Committee said before making any changes.
A considerable amount of money is spent on new vessels. It has been suggested on other occasions that standard vessels might be built. Perhaps it is along those lines that there will be a considerable cut in costs. In other countries standard vessels are built. A firm in San Diego, California, issues a brochure offering vessels of 44, 60 and 115 ft. One knows the type of vessel and the price which one will have to pay and the cost of any modifications one wants. A continental firm is building trawlers of 120 ft. and one can tell the price and other details of such a vessel well in advance. It is registered in the higher class of the Maritime Register of Russia, so that the firm is getting a considerable number of orders there.
Two things come about with the construction of standard vessels. First, they meet the needs of the industry at a price which should be considerably less than the placing of single orders. Secondly, 237 with so many complaints about small shipbuilding yards going out of production, the construction of standard vessels provides one method of putting them back into production.
It is along those lines that we will get a solution. We will never get a solution merely by devoting two or three hours once a year to a discussion of whether the subsidy should go up or down. This is a great industry calling for much thought. The Government should indicate whether they are prepared to follow some of the suggestions made this afternoon. I appeal to the Government to consider the subsidies, to consider making a tonnage payment for scrap, as they have done for the cotton industry, to consider interest charges and certainly to consider the proposal that the White Fish Authority might study the building of vessels of a standard type.
If the Government can be persuaded to go along that road, I think that they will be taking the road to a fairly prosperous, economical and efficient industry, which would provide not only a good supply at reasonable prices for consumers, but a respectable living for those engaged in it.
§ 4.47 p.m.
§ Mr. Richard Stanley (North Fylde)
Listening to the speeches which we have heard so far, it certainly seems that the Scottish difficulties are very nearly the same as the English difficulties. We have had an almost all-Scottish attack, and the only other Englishman who has spoken seemed to lead that attack. However, it is a great change for us to debate this subject at a sensible hour of the afternoon. It is also new that we should hear the Scottish case first, and I hope that the English case will be answered by my right hon. Friend, because it often happens that the Scottish case is answered by the Joint Under-Secretary, speaking only for Scotland.
§ Lord John Hope
I inserted a few paragraphs in my speech in connection with peculiarly Scottish difficulties, but when my hon. Friend reads HANSARD I think that he will find that the bulk of my speech dealt with the position in the United Kingdom.
§ Mr. Stanley
I listened with great interest, but I think that my noble Friend 238 will find that "Scotland" came into his speech much more than "England".
One can easily see why the fishing industry should come under the same Ministry as agriculture does. It is obvious that each area has its own special difficulties. We all have roughly the same outlook, but it is probably true that every port has its own difficulties. It needs no apology from any of us if we mention our own cases. It seems that everyone is asking for an extra subsidy of some sort or another and I have heard rumours—I do not know if they are true—that even the distant-water vessel owners will come cap in hand to the Treasury or to my right hon. Friend next year to ask for help. It will certainly be a change after what they said when the White Fish Authority was set up.
I want to say a few words about the difficulties of Fleetwood, the port which I have the pleasure to represent. In wartime, it was an exceptionally prosperous port, for all the Hull and Grimsby trawlers discharged their fish there because it was on the west coast. Now. obviously, the vessels go back to their own ports. If they had to stay at Fleetwood they would have to sail very much greater distances to get to the fishing grounds. The Fleetwood trawlers always have about two more sailing days than the trawlers which fish from Hull and Grimsby.
To illustrate the point, this winter 60 per cent. of the vessels fishing off Iceland, which, as everyone knows, was difficult, were from Fleetwood. One knows the difficulties with regard to Iceland, and we are only sorry that so far we have not been able to come to an agreement with Iceland, although, obviously, the Government are doing all they can.
Here I should like to say how very grateful all the crews and skippers are to the Navy for the wonderful job which it has done. The Navy has co-operated very well, but it is an extremely difficult position. The Navy tries to ask the skippers where they would like to fish, but those of us who know anything about this matter know how very independent-minded skippers are. They all have different ideas. Therefore, a lot can be said for the Navy not having run into a head-on clash.
239 Fleetwood, practically more than any other port, has carried out the conversion from coal to diesel. In 1954, there were 90 coal-burning vessels and only 13 diesel vessels, whereas now there are 24 coal-burning vessels and 49 diesel vessels. It therefore shows that the trawler owners are trying to take advantage of the Government scheme. But by doing that there are fewer fishermen employed in the port. Therefore, the industry is suffering from unemployment. About 200 men are unemployed, which is about half the unemployment for the town, so one can see that by carrying out what the Government wanted them to do the fishermen have suffered. I therefore think that the Government will have to consider the whole subsidy question again, to see how they can help these people.
There are many reasons for asking why people did not speak up when the scheme was first mooted, but a lot of changes have taken place since, particularly in connection with Iceland. Even though the industry has new vessels, the catch is right down. For instance, in the first six months of 1959, compared with the first six months of 1958, the value of the catch was down by £250,000, which, out of a total of £2½ million, is very serious. This was mostly due to the trouble with Iceland, but it was also due to the fact that fewer vessels were operating.
Hon. Members have spoken about accountancy. I do not trust myself with figures. I think that anyone can make them mean what he likes, and I find myself at a loss with them. Possibly, the Ministry's accounting is as bad as mine. I should like to refer to what I have discovered from a company which has built five vessels in the last five years. According to the Government's calculations, this company should make a profit of £12 every day. In fact, they make a loss of about £13. The reason for this discrepancy, as has been said, is that the Government, in working out the figures, paid no attention to the interest on borrowed money, which would appear to be an extraordinary thing to leave out.
The other point concerns depreciation rates. In the old days, coal-burning vessels lasted for a very long time, but I gather that the owners and people who 240 work in the diesel trawlers are worried that these vessels will not last nearly so long. They feel that if they can write off their vessels in the first ten years, hoping that the vessels will last fifteen years, for five years they hope that they will run at a profit. As the owner of these trawlers told me, depreciation should go up from 6⅔ per cent. to 10 per cent., but it is not much good allowing for depreciation if there are not profits to write it off against.
I know that the picture which I have painted about Fleetwood seems to be rather gloomy, but it is genuinely true. During January and February this year we had probably the worst storms that have occurred at sea for a very long time. Many trawlers which were in the habit of fishing for 21 days could fish for only one day, or possibly two days. The crews had a terrible time at sea, and when the trawlers came back to port there was no profit for anyone.
My hon. Friend the Member for Banff (Sir W. Dutbie) and the hon. Member for Edinburgh, Leith (Mr. Hoy) spoke about the question of research to discover what has happened to the fish. We have heard a little about how it is not possible to find herring. Whether the Socialist Government were responsible for this, I do not know, but this year—and I hope it is not a sign that a Socialist Government will return to power—the fishermen cannot find hake, and, for a port which relies on hake as its chief catch, this is a serious matter. I hope that the Government will invest more money in research.
As has been said many times, the Russians are building a large fishing fleet. They are not doing this for fun, but because they know that they are in a position to catch fish. I cannot help feeling that their research is further advanced than ours. I do not know how far our research has gone, but I do not think that it has gone nearly far enough. If we devote more time and energy to research, surely we will be able to find new grounds to fish.
Some ports may be doing all right at present, but, as I say, Fleetwood is not doing well. It is having a bad time this year. Probably my right hon. Friend will not have a chance on this occasion to do much about it, but I hope that in the near future he will consider the whole position to see whether he cannot give a 241 subsidy to help this industry. It is no good letting it get into a bad way and then, as with a patient, having to perform a major operation. If the industry receives a reasonable injection now, I am certain that it will be able to carry on in a right and prosperous manner.
§ 4.58 p.m.
§ Mr. Hector Hughes (Aberdeen, North)
Notwithstanding some of the partisan observations of the hon. Member for North Fylde (Mr. Stanley), I submit that this is a matter of national importance which should not be treated in a party way. I would not dream of attempting to import party politics into a national matter of this sort. I deprecate the observations made by the hon. Gentleman along those lines.
§ Mr. Stanley
Could the hon. and learned Gentleman mention one thing that I said about party politics?
§ Mr. Hughes
I pass from that.
The Minister said that one of the aims of these Statutory Instruments is to help the fishing industry and to accelerate the rate of transfer from coal-burning ships to oil-burning ships. I agree that that is very desirable, but I differ with him about the rate at which it should be done. The attempt to accelerate the rate is prejudicial to the industry and to all concerned.
The reason these Statutory Instruments are drafted in this way appears to me to be because they are drafted without due consultation with the practical people concerned in the industry. Such consultation is essential, and it is obviously lacking here.
I have had the advantage of consultation with the relevant owners' organisations and the relevant trade unions, and they, masters and men alike, support me in opposition to these schemes. The Fisheries Section of the Transport and General Workers Union has had correspondence on this matter with the Minister of Agriculture, Fisheries and Food and also with the Secretary of State for Scotland. In this correspondence the union says:These schemes are singularly inopportune and ill-timed, coming as they do when the industry is faced with the threat of exclusion from the prolific Faroes "—this was written on 17th July, 1958, before the Faroes Agreement— 242and Icelandic fishing grounds, traditionally fished by British vessels for many decades.The letter goes on:It will be argued that these may have the desirable effect of expediting the scrapping of obsolete coal-fired vessels and the subsequent replacement by modern diesel and diesel-electric vessels. This may be conceded as a long-term view, but in those ports where the preponderance of the fleet are still aged, e.g., Aberdeen, Granton, Milford Haven, etc., the net result may be to enforce the laying up of vessels with the consequent heavy redundancy amongst crews. In strict economic terms the cuts will probably represent a drop in revenue of between £1,200 and £1,500 per annum, making all the difference between running at a loss and showing a profit, or at worst breaking even.That is the view of the Transport and General Workers Union and it is also the view of the trawler owners' association in Aberdeen.
I have also had the advantage of consultation with experts with practical knowledge from such important ports as Aberdeen, Fleetwood, Granton, Grimsby, Hull, Leith, Milford Haven and North Shields. They include those of inshore, near and middle-water fishing and, as far as personnel in the industry is concerned, they include the whole industry—the builders and owners of ships, the seafarers who catch the fish as well as the merchants, transporters and fish market porters, all of whom make their contribution in money and kind to this great industry.
These Statutory Instruments fail to solve the relevant problems for owners, workers and consumers, and it is obvious from what has already been said that the majority of hon. Members who have so far spoken are against these schemes.
I shall address myself to three aspects of the schemes as far as Aberdeen is concerned—(1) subsidies, (2) interest rates, and (3) grants for fishing vessels and engines. The new White Fish Subsidy Scheme, which it is now proposed should operate from 31st July this year to 31st July next year, revokes the earlier scheme and alters for the worse the subsidies in respect of coal-burning and oil-burning vessels while the rate for diesel-engined vessels remains the same.
The reason for this adverse change is apparently to accelerate the rate at which ships are changed from coal- and oil-burning to diesel-engined ships. Is this a sound policy? In my submission, 243 the answer is twofold. It is a sound policy to change from coal burners to oil burners, but it is not sound policy to rush it with a penalty attached. I shall give reasons for that twofold answer.
This Statutory Instrument seeks to speed up the change by penalising the trawler owners and through them the crews, the merchants, the porters and the consumers. The penalty imposed is unfair and unjustified. It is a reduction in the subsidy to the coal- and oil-burning trawlers which cannot fail to be reflected in the conditions of the workers in the industry, in the price to the consumers and in the profits to the owners.
I shall give figures—of which I have plenty here, but I shall not trouble the House with many of them—to show why the change is good if gradual and why it is bad if it is precipitate. The figures, which I have, show the profits and losses of the trawlers in each class. The coal burners made losses while the oil burners made profits. This in itself is, in my submission, a sufficient penalty on the fishing industry without any reduction in the subsidy.
The Scottish Home Department's Consolidation of Profit and Loss Accounts for 1959 show the position for each type of vessel. They are compared with estimates for 1959–60. I regret to trouble the House with figures and I shall give as few as possible. For each coal-burning trawler there was a loss in 1958 of £1,955 and there is an estimated loss of £4,122 in 1959–60. On the other hand, if we look at the oil-fired trawlers we find that in 1958 there was a profit for each such trawler of £2,628 and for 1959–60 there is an estimated profit of £1,235. For each motor vessel there was a profit of £2,620 in 1958 and for 1959–60 there is an estimated profit of £1,267.
For Aberdeen alone, the chartered accountant's estimates for 1959–60 are as follows. For coal-fired vessels a loss of £4,812; for oil-fired vessels a profit of £1,107, and for motor vessels a profit of £378. In all these cases the subsidies were included. There is, therefore, no doubt that the change from coal to oil is a good thing for the industry. The loss by coal-burning vessels is a bad thing—a sufficient penalty in itself without reducing the subsidy.
The arguments against the reduction of the subsidy for coal-burning vessels 244 are, therefore, (1) that those vessels are a loss in themselves, (2) that the reduction in subsidy adds to the loss, and (3) that this tends to drive them off the seas in a precipitate way which is bad for the industry, the owners, the crews, the merchants, the consumers and all concerned.
In addition, there are social and economic arguments against doing it in a precipitate way. Those arguments mainly relate to the sudden transfer of labour without warning, to the turnover of skilled labour to man oil-burners, to the loss of personnel risked thereby, to the loss of organisational balance!, to the resulting peril to established business connections and to the consequential damage to ancillary trades such as repair shops and supply stores. In my submission, if these convulsions in the; industry bring the danger of loss of trade in a particular port, such loss will not be easily or quickly recovered It may never be recovered and it may be a permanent loss to that port,
I should add that in Aberdeen, without this new penalty, the scrapping of old ships, as the Joint Under-Secretary of State has admitted, and the building of new ships has proceeded steadily and well. The following are a few of the figures. The number of vessels scrapped in 1956 was 26; in 1957, 12; in 1958, 10; in 1959, up to July, 5—say 10 for the year; making a total in four years of 58 scrapped, an annual average of 14½ vessels scrapped. On the other hand, the numbers of vessels built in Aberdeen were for the same years: in 1956, 3; in 1957, 15; in 1958, 15; in 1959, up to July, 6—say 12 for the year; making a total in four years of 39 or an average of 9¾ vessels built.
Add to that this observation, that these newly-built ships are obviously better, modern ships, catch more fish, and are more profitable to all concerned; so that even though the new ships built were slightly fewer than the ships scrapped—very slightly, the difference is very slight—the quality of the new ships was much better and the catches were bigger and the profits were bigger, than in the old ships.
To this I should add that on 1st July this year in Aberdeen 17 vessels were tied up and stripped of their fishing gear and will almost certainly be scrapped by 245 the end of this year. In addition, there are from 15 to 20 more in Aberdeen which will probably be scrapped by the end of this year.
Turning to the other side of this marine picture of Aberdeen, a survey of owners' building programmes at 1st July indicates that in 1959, 21 new vessels will commence fishing; in 1960, 15 definite new vessels and 6 or 7 possibles will come into service; in 1961 2 definite new vessels and 2 more possibles will come into service. So this new penalty is neither necessary nor desirable in Aberdeen—and I am speaking only for Aberdeen—and it will damage the industry rather than improve it.
My argument against penalising the fishing industry and in favour of maintaining the subsidy at its present rate or even of increasing the subsidy for coal-burning and oil-burning trawlers is supported by the White Fish Authority's Report for the year ended 31st March, 1959, which, of the coal-burning vessels, said:The need to keep them fishing to maintain supplies will diminish as new trawlers and seiners come into service, and in the Authority's view, the subsidy support now given to them should gradually be brought into line with that given to motor trawlers generally. A step in this direction was taken in 1958. The adjustment must be gradual "—and that is my argument: the adjustment must be gradual—to avoid a sharp decline in fish supplies and to lessen the impact on employment.
§ Lord John Hope
That has nothing to do with coal burners. The hon. and learned Gentleman was telling the House that the Authority's Report backed him in his argument about coal burners, but that is a quite different point.
§ Mr. Hughes
It speaks not only for itself but it speaks for me, and it speaks for Aberdeen, and I agree with it.
I add that that advice is sound advice, the advice which I quoted. We still want, to quote the Report, to "keep them fishing" until they are fully replaced; we still need "to maintain supplies" of fish for the consumers; we 246 still want "to avoid a sharp decline in fish supplies"; we still want "to lessen the impact on employment." We still want to avoid unemployment in the fishing industry by what the union calls the ill-advised and precipitate reduction of subsidy.
I should like to say a word about interest rates. The artificial rates now inflicted on the fishing industry do it a great injustice. This is a grave and prejudicial feature. It has become the practice to surcharge Treasury interest rates by an additional ½ per cent. This is iniquitous, and penalises the industry. It is also thoroughly unsound, because one-half of that half goes to meet the administrative expenses of the grant and loan scheme which should be borne by the Treasury, and the other half is a provision against bad debts for which the ship itself is security. So the White Fish Authority is doubly secured, which is quite unnecessary.
I have an example here with many figures which I had intended to cite to the House, but having regard to the amount of time I have occupied so far I shall not trouble the House with the figures.
However, I want to say a few words about the Grants for Fishing Vessels and Engines (Amendment) Scheme, 1959. This is laid under the two Acts of 1953 and 1957, which provide for grants to persons engaged or proposing to become engaged in the acquisition of new fishing vessels and engines. The present scheme is designed to increase the grant limits from £30,000 to £37,500. My objection to this is based on the fact that it is not enough. This point has been made by earlier speakers, and I fully support them. It is not enough bearing in mind the present costs and conditions in the shipbuilding world.
In Aberdeen most new vessels are from 100 ft. to 115 ft. in registered length, and cost up to £120,000. This uplifting of the ceiling from £30,000 to £37,500 is, therefore, useless to Aberdeen.
The Aberdeen Fishing Vessels Owners' Association has claimed ever since 1955 that 25 per cent. grant is insufficient at current building costs. It should be increased to at least 33⅓ per cent. with no ceiling. Without that there is little or no incentive to build new ships.
247 Letters to the White Fish Authority have been written from Aberdeen on 16th March, 1955—as far back as that—on 23rd August, 1957, and 4th March, 1959, from experts who know the needs of the situation. One letter, dated 23rd August, 1957, says:My Directors consider it necessary that with immediate effect the 25 per cent. grant should have no ceiling and that it should relate to total building costs. Further they consider that there is a good case for the substitution of 33⅓ per cent. for 25 per cent. and your knowledge of the rise in building costs will permit you to agree with this request.Alas, it is a sad thing that the Authority's knowledge of building costs was so negligible that it did not induce it to agree to that request. It should know how much it costs now to build new ships and it should know that this 25 per cent. is completely out of tune with present-day costs.
Since that letter was written the financial position due to high costs and interest rates has become more acute. The maintenance and extension of the fishing industry in Aberdeen with its ancillaries affects the fortunes of at least 10,000 workers. It also affects the safety of the nation in war, because the men who devote their lives to fishing in time of peace and the ships which are fishing vessels in time of peace are the men and ships that sail to defend this country in time of war.
We want to look at this not in a narrow way as representing the industry, the workers, consumers or owners, but in a way as representing the interests of the nation at large. These Statutory Instruments should be taken back and reconsidered by the Ministry. There is yet time to do it. We are only in the middle of July, and the present Schemes will not expire until the end of July. Therefore, there is ample opportunity to draft new and better plans, and I strongly exhort the Minister to do so.
§ 5.20 p.m.
§ Lady Tweedsmuir (Aberdeen, South)
As I sat listening to the hon. and learned Member for Aberdeen, North (Mr. Hector Hughes), I realised the fascinating fact that I could deliver his speech practically word for word, because he and I, of course, have been provided with exactly the same brief. I recognised large passages in his speech, and I shall try not to go 248 over the same ground, if I can possibly avoid it, and I shall use my own words, although they may not be so precise as the brief which has been supplied to us.
When the hon. and learned Gentleman says that the Annual Report speaks for him, I think that he is not very accurately interpreting the bulk of the Report, and that he did not pay due tribute to the very steady work which is going on now in Aberdeen, the first port in Scotland, to try to modernise the fishing fleet. I realise that this debate is taking place in very great difficulties, because we are all awaiting the Fleck Committee's report. I am one of those who are not too anxious to see the work of this Committee finished too soon, firstly because, speaking for the industry as a whole, I think it has a very difficult job that must be throughly done, and, so far as Aberdeen is concerned, the longer the Committee takes to report the better the position Aberdeen will be in to get favourable treatment when the Committee's report comes before the Government of the day.
A few years ago, it could possibly have been said that Aberdeen was an uneconomic port. We have a very large number of coal-burning vessels still, and we still have 112 that are over thirty years old. On the other hand, we are now steadily working towards modernising the fleet, and we have had fifty-six approvals for grants under the White Fish Authority scheme. We have, in fact, as a port at present the largest number of new trawlers built, building or on order, so that progress is really being made.
I quite agree with the hon. and learned Gentleman and also with the hon. Member for Lowestoft (Mr. Edward Evans) that it is unfortunate that the increased grants, which have been revised from £17 million to £19 million, have not been raised still further. I say that because I realise that it is the White Fish Authority itself which has asked for a higher ceiling. If there were the higher ceiling of £40,000, for which the Authority has asked, it would be equivalent to 25 per cent., which was the original idea when the scheme came into operation in 1953. I have very much sympathy with all those in the industry who put forward the plea that in this particular case, surely the Treasury should not be guided only by economic 249 considerations, but by the principle of the direct subsidy as is applied in agriculture. When we apply the two together—agriculture and fishing—it is obvious that the fishing industry has much more difficult problems to contend with.
As far as Aberdeen is concerned, I can sympathise with the view that perhaps too few old boats have been scrapped in the last few years, and the figures show that quite clearly. On the other hand, it requires the scrapping of six old boats to raise sufficient to put down the 15 per cent. required for the building of a new one. If the scrapping of old boats is too slow, it is perfectly obvious that it will be more difficult to gel the replacement as quickly as one would want. At the same time, we are still in a period in which the order books are full and when the construction of new boats is very much quicker and takes much less time than it did soon after the war. The fact is that we must try to get the right balance between the number of steam vessels that are scrapped and new construction at this particular moment.
Therefore, I question whether the Government would not have been far wiser, in this period while we are waiting for the report of the Fleck Committee, to keep the subsidies exactly as they were last year, which, taking into account the figures that are agreed by the Department, still show that there would be a greater loss on every vessel. I realise the difficulty of making the judgment on what is the right balance, but of course we must realise that there are three important things which we must avoid by a too rapid scrapping of old vessels.
Firstly, we must avoid a big fall in home-produced fish supplies. Secondly, we must avoid fishermen leaving the industry, and this is particularly important to Aberdeen, where many men, unfortunately, still venture south, and it is very difficult to replace men with this skill and experience. Thirdly, at a time when Scotland is still suffering from a disparity in the employment figures as compared with England and Wales, I should have thought that it was very important to keep the right level of employment in the fishing industry. In Aberdeen, it provides one-third of the employment for all our people, if we take into account all the ancillary trades.
250 I think myself that one of the big considerations in the fact that the scrapping of older vessels has been slow is not so much what my colleagues representing English ports call the high rate of subsidy as the fall in the price of scrap. Now that scrap is rising in price, though slowly, I think it will have a very great effect on the rate at which these vessels are put out of commission.
In page 36 of the Report, reference is made to Aberdeen as—by far the most important landing centre in Scotland.'I hope that will be fully taken into account by the Fleck Committee in its final deliberations. The average catch has been higher and the average earnings have been higher, and, from the consumer's point of view, although fish is not cheap, I think it is of better quality than at any time since the end of the war. I say to all my colleagues, from whatever port they come, that if they want really prime fish, they should go to Aberdeen.
§ Lady Tweedsmuir
Aberdeen. We shall also have a very large increase in the amount of quick-frozen fish of very good quality.
There is an interesting experiment going on in Aberdeen at this moment, which is being supported by the Government and which is of great importance in view of the amount of fish supplies landed in the port. It is an experiment in dehydration. The other day, we had the Highland show in Aberdeen, and I was shown a small container in which was enough dehydrated fish to feed sixty people. I am told that this development is the kind of thing which will make the deep freeze out-of-date, and will bring a new industry to this country.
What I find rather disappointing about it is that while we in this country and in Scotland have developed this experiment, it is America which is first taking advantage of it commercially. I hope that the very good work which is being done by the various research bodies in the Fisheries Department will be made more widely known to industrialists and that some of these experiments will be put into commercial use for our own people.
251 Paragraph 13 of the White Fish Subsidy (United Kingdom) Scheme refers to the subsidy payable as including the day of arrival in port… and the day on which the first-hand sale of the catch commences (if that is different from the day of arrival of the vessel) …I should like to make a plea that, wherever it is possible, arrangements should be made whereby in home ports home boats get priority. What often happens, certainly in Aberdeen, is that many of our own boats come in and get the second sale. This subsidy, given to help our own fishermen in the operation of our own boats, is not having its full effect because our fishermen can take advantage only of second sales because they cannot get a berth.
The success of the subsidy scheme depends upon our securing a successful settlement of the fisheries dispute on the lines of the Faroes settlement. I realise that it is out of order to refer to that dispute in this debate and I mention it only in passing. I hope that when the Fleck Committee reports it will be seen that Aberdeen is now getting into a very much stronger position than it has been in for many years and that this applies also to the quality of the fish which it produces.
I believe and hope that the Fleck Committee will look upon Aberdeen not only as the major fishing port of Scotland but one which can produce and sell fish of the finest quality in the United Kingdom. That being so, I hope that the Government, when they examine the report, will give full consideration even to differential rates of subsidy in different parts of the country. While, of course, I am glad that the grants are increased, I feel that they do not go as far as any of us would like. But we are thankful for something to keep us going until the Fleck Committee has reported.
§ 5.32 p.m.
§ Mr. J. Grimond (Orkney and Shetland)
I hesitate to divert the attention of the House from the fascinating subject of Aberdeen but I think that we have given it a fairly good doing. I was delighted to hear that it is to have some new trawlers. A good many of them visit my constituency and some of them look extraordinarily old. I thought that I heard it said that some were 130 252 years old. This takes us back to a time before the Reform Bill. Wellington was in his prime. The "Rocket" was hardly running and the "Great Western" was a dream in its designer's eye. That cannot really be true.
I take the House back to inshore fishing and the centre of the world—my own constituency. We must start from the present position. The Government and the House of Commons have agreed that the fishing industry, in most of its forms, needs support and the House has decided upon the method by which it should be given. As the noble Lady the Member for Aberdeen, South (Lady Tweedsmuir) has said, and other hon. Members have also pointed out, every part of the fishing industry has its own peculiar problems. We in Shetland have a peculiar difficulty over transport, freight and marketing. We are forced to run our fish to Aberdeen, where we suffer very much from congestion on landing, or we have to pay freight to take the fish by steamer. All of us would have suggestions on how the money voted for the fishing industry could best be used, but for the purpose of this scheme the broad outline has been agreed.
I should like to look at the present position in Shetland. We have one "Zulu" boat left to us but it is only half the alleged age of the Aberdeen trawlers. On the whole, our fleet is remarkably modern and we have taken full advantage of recent grants and loans. Are the Government really so satisfied with the general position of inshore fishing that they feel able to reduce the subsidies on the big boats? Do they feel that the subsidy has finished its job which they intended by bringing the boats up to date and giving a reasonable return on boats of various sizes?
The hon. Member for Banff (Sir W. Duthie) gave some figures of wage rates. I also have been given some figures. I understand that the rates are about £9 10s. on the 40 ft. to 70 ft. boats and £12 to £13 on the bigger boats. These are not high wages for this skilled and dangerous work and the long hours. We are told that the average profit on the small boats is under £500 and on the bigger boats over £1,600. Are these figures correct? Do they conceal enormous variations? My impression is that there are enormous variations between 253 the earnings of different boats in all types of fishing and that average rates are misleading.
Do the figures given take into account such things as interest rates and depreciation? I am also informed that costs have gone up, in spite of the tailing-off of inflation and the comparatively stable price level recently. Rope has increased in cost in the last twelve months by 17s. a coil. Other costs have gone up too, and I am told that it is estimated that profits will fall slightly this year and that even the biggest boats will have slightly lower profit rates.
Clearly, nobody wants to subsidise the industry more than is necessary to set it on a sound footing, see it brought up to date, and enable it to give the country a supply of fish and carry out the Government's general intentions. But, in view of these figures and others given this afternoon, we must ask whether this is the moment to cut down the rate of assistance, even if it is done only in respect of the 70 ft. boats. The cuts will mean a difference of about £120 a year.
Whenever I go to Shetland I find more and more foreign fleets fishing round Shetland waters. The Russians have been fishing for years with parent ships, tankers and large and powerful modern fleets of catchers. Last time I was in Lerwick, there were five or six very good Dutch boats there. The Poles and the Germans come, and the Norwegians come for dogfish. In view of these facts, we must ask whether we are facing the realities of North Sea fishing today. I doubt very much whether we are. We seem to believe that the problem can be dealt with by doling out enough money to keep the industry ticking over, without realising that it is being rapidly passed by the enormous catchers from the Continent. I do not want to go into the question whether these are depleting stocks, but they are catching an immense amount of fish. The Russians are hauling shoals out of the North Sea.
I, too, regret that we are having this debate in advance of publication of the Fleck Committee's report. I doubt whether the report will be radical enough in its approach to the industry, but the Committee is taking great trouble over it, and we must see what it says. In the 254 meantime, we ought not to discourage the building of bigger boats. I do not think that the reason for reducing the subsidy on the 70 ft. boats is valid in Shetland. It is fairly easy to see whether a boat is trawling or not. None of our ten or a dozen boats trawl. We must encourage the building of bigger boats and go in for new catching methods. We must encourage research and keep a very close eye on what other nations are doing both with regard to stocks and methods of fishing.
The Government will have to settle down very soon to considering the fishing industry against the background, first of all, of Highland development as far as my part of the world is concerned, because this is one of the most hopeful industries that we have in the Highlands. Secondly, the Government must consider the industry against the background of markets. There is still on the Continent a large market for herring. The continental countries are catching this fish for themselves.
What is the real outlook? With freezing, packing and filleting, there is no doubt that more people may be willing to buy fish nowadays because it is so easy to prepare. How far can this be carried? How far is there a market for herring? How far is it worth going all out for really up-to-date mass catching fleets? If we can do this, I am sure that is where the future of the industry lies, but it depends on markets. Apart from regretting that we are discussing these changes in subsidy in advance of the Fleck Committee's report, I wish to end on the comment that we have got to take a much wider look at the future of the whole of our fishing in the north of Scotland, bearing in mind markets and catching methods.
§ 5.40 p.m.
§ Mr. Patrick Wall (Haltemprice)
As an Englishman, I hesitate to intervene in this debate, which has become almost exclusively Scottish. I shall probably be even more unpopular when I come down on the side of my right hon. Friend the Minister of Agriculture, Fisheries and Food on the question of coal-burning vessels, which is one of the main subjects of the debate this afternoon.
The Report of the White Fish Authority for 1958–59 has already been 255 referred to, and if we look in that Report we find that there are 814 fishing vessels over 70 ft. long in service. Of these vessels in England and Wales, 264 were built before the last war, that is, before 1939, and 102 were built before 1918. So that there are still a large number of ageing vessels in England and Wales, and this applies especially to Scotland. I believe that the figures for Scotland are: 146 built before the last war and 100 built before the First World War. Of the middle and near-water vessels, 233 are coal-burners and are thirty years old or more. All these figures are given in the Report.
I accept the view which has been expressed on both sides of the House that it is difficult to replace these vessels, particularly those operating in the smaller fleets. We have to try to keep a balance by replacing, say, three coal-burners by one oil-fired or diesel vessel. But this scheme has been in operation since 1953 and it is due to end in 1963. Why have not the coal-burners been replaced a little more quickly? I suppose the answer that we shall get is that the 1957 credit squeeze was not conducive to replacing these vessels.
On the other hand, it is true to say that coal-burners are uneconomic and that to some degree the subsidy keeps these uneconomic vessels operating. This was not what the subsidy was intended to do. The object was clearly defined as that of replacing the coal-burning fleet by 1963—in only four years' time. This replacement programme is made easier by the increase which has been given for new vessels up to 140 ft. in length.
The point has been made that the increased grant of £7,000 is not as much as that recommended by the White Fish Authority, namely, £10,000, giving a total of £40,000, which represents about 25 per cent. of the cost of a new vessel and which was the figure which was in people's minds when the scheme was first introduced in 1953. In other words, we are not carrying the scheme back to its original conception, and my right hon. Friend should give consideration to that point.
There are two other matters to which I will refer briefly. One is the depreciation allowance for trawlers of 6⅔ per 256 cent., which is equivalent to a life of about fifteen years. It has been suggested that that figure should be 10 per cent. per annum, and I hope that my right hon. Friend will refer to this matter when he winds up the debate, because this question of depreciation is one in which the industry has considerable support in this House, as well as the allied question of loan interest not being included when working out charges for subsidy purposes.
I should also like my right hon. Friend to bear in mind that, although I support him in the scheme, it has been shown that the profits on new diesel vessels are dropping. In the year before last the profits averaged £1,300 per vessel in the year. Last year, they were averaging only £1,000. This year building costs are increasing, fuel will probably increase in price, and the profits will drop again.
Reference has been made to the problem of a balanced fleet. Here again, we want the new diesel vessels to carry the old coal burners, and if the new vessels' profits are going to drop fast they will not carry the old and the scheme will not be as effective in replacing the old coal-burning vessels.
May I now turn to the problem of the distant water section of the industry? Hull is the country's premier fishing port and the fleet at Hull is faced with serious difficulties. For instance, there are the obsolete slipways, which can slip only 10 per cent. of the fleet and which are not being modernised by the British Transport Corporation. There is the problem of replacement costs. When talking about the middle-water vessels, a figure of £130,000 for a new vessel was quoted. In the distant-water section that figure is over £250,000 per vessel and some of the owners are thinking of factory ships where the cost goes into several millions of pounds. Then there is the increasing competition particularly from Soviet and Polish fleets with their research and factory ships, and so on.
Finally, there is the supreme problem which affects the distant-water section of the industry, that of the 12-mile limit and the threats which have been voiced of increasing this limit up to the 100 fathom line. That would have very severe repercussions on the industry. I 257 know, Mr. Deputy-Speaker, that you will not allow me to enlarge upon this subject, but I would say to the Minister that the problem of the limits, together with the case of replacements, may lead even the distant-water section to make requests for subsidies in the future. These people do not want subsidies. They glory in their independence, but they have got to face the economic difficulties that are looming in the future.
May I echo the words of the hon. Member for Lowestoft (Mr. Edward Evans) and others in saying how glad I am that we are debating this important subject at a relatively early hour, but may I also say that we are very limited in what we can discuss? Thanks to the kindness of the Chair, I have been allowed to mention one or two points which do not come strictly within the ambit of the debate, but the many problems of the distant-water section cannot be discussed in this debate. I hope that the usual channels on both sides of the House will note this fact.
The fishing industry has never been made the subject of party politics, and perhaps we are suffering from that fact, because if it were the subject of party acrimony we might have more debates on these important problems. I hope that in the near future we shall have a fuller and longer debate on all the aspects of what is, after all, one of Britain's most important industries.
§ 5.48 p.m.
§ Mr. Desmond Donnelly (Pembroke)
Two things stand out in this debate. The first is that, apart from the hon. Member for Haltemprice (Mr. Wall), hardly any hon. Member has had a good word to say for the subsidy scheme. The second is that even including the hon. Member for Haltemprice—and that is quite a large concession—nobody is complacent about the future of the fishing industry.
The Minister, when he replies, will have to do a good deal more than was done by the Joint Under-Secretary—although I congratulate him on his admirable and lucid exposition; his was the only speech which defended the subsidy scheme—in taking a longer-term look at the future of the industry in order to allay the fears and apprehensions in the minds of those engaged in the industry.
258 I do not propose to go over all the ground which has been covered this afternoon. I shall telescope my remarks, although I would just like to say this. I support wholeheartedly the words of my hon. Friend the Member for Lowestoft (Mr. Edward Evans) about interest rates. I support, too, what the hon. Member for Banff (Sir W. Duthie) said about discussing all these subsidies in advance of the Fleck report. Also, I support what the hon. Member for Orkney and Shetland (Mr. Grimond) said about the need for new research and new methods, and the fact that we should not be complacent about the situation.
In a few brief words, as brief as the speech of the hon. and learned Member for Aberdeen, North (Mr. Hector Hughes) but not nearly so eloquently, I propose to speak about the incidence of the new subsidy scheme on the Port of Milford Haven, which is in my constituency. It is the largest port in Wales, the only deep-water port, the main source of supply for the South Wales market, especially industrial South Wales, and that is its raison d'etre.
The background to Milford Haven is that when this Government came to power in 1951 there were about 90 trawlers fishing from the port. Today, there are 41, so the fleet has been more than halved. I do not lay all this decline at the door of the Conservative Government, because the fish have to be there, but, nevertheless, the situation has deteriorated rapidly and alarmingly, and we have now reached a position where the port could not be sustained any longer if the fleet were to deteriorate any further. That is a practical point.
The right hon. Gentleman may recollect that in the days of his predecessor, the present Chancellor of the Exchequer, when the price of coal went up sharply, a deputation from the Port of Milford Haven went to see the Minister. Partly as a result of that, there was a change in the subsidy rates which met the interim need of the coal burners in the port, on the understanding that we would make as rapid a conversion as possible to oil-burning and diesel trawlers.
At that time practically all our ships-were coal burners. It was a serious situation for us. Today there are 16 diesel boats, 5 oil burners and 20 coal burners. Therefore, this cut in the subsidy to the 259 coal-burning ships is a severe blow to the port, and it affects half the fleet; but the other half of the fleet has changed. I understand the object of the change in the subsidy rates, which is to promote the speed at which the coal burners are being scrapped, but—and this is a very big "but"—I suggest to the right hon. Gentleman that he looks at what has been done already. In three years, as I said, half the fleet has been converted, scrapped or replaced.
That is a very big change indeed in only three years. It has been done despite the adverse circumstance of the fall in the scrap rates. It has been done despite the high interest rates which have existed at times during the tenure of office of this Government. It has been done despite the reduction in the supplies of fish, which has been going on continually because of overfishing, and which diminishes confidence.
If, as I said earlier, the fleet diminishes any more, it will not be possible to sustain the port. The fish market, the refrigeration facilities, the railway services, all that go with it, are dependent upon an economic unit being retained. The employment of about 1,000 people, and indirectly the livelihood of the town of Milford Haven, is at stake.
Now, I know that various people have said that in this port there is to be a shift away from the fishing industry, and that one day it may become one of the largest oil ports in Europe. But, from the point of view of what is foreseeable in the immediate future, the employment position is still far from satisfactory. At present, about 2,000 people are engaged in work on the construction of one oil refinery, but when that is completed, in two years' time there will be employment for only about 500. The others will have to depend again for their livelihood in the future on the fishing industry, as they have done in the past. There is no replacement for my constituency, for the Port of Milford Haven, as an employment unit, whatever may happen in the foreseeable future as regards the oil developments.
The conclusions to be drawn from this are that if the port declines any further a grave social problem will arise. That problem will inevitably be the responsi- 260 bility of the Government. Inevitably, it will be partly the result of the decisions which the Government are asking us to take today. This is a very heavy responsibility which they must face. If only the Government had allowed the old state of affairs to go on a little longer, in three years the situation might have changed out of all recognition, and this would have been well within the time limit of the ten years envisaged when the 1953 Act was passed. The port would then have been viable.
I ask the right hon. Gentleman, when he replies to the debate, to admit that he will have another look at the subsidy rates. The Government may well be condemning the Port of Milford Haven to oblivion, and if they do that, if they stab the town in the back, I can assure them that they will hear a great deal more from myself and from other people concerned in the life of the area. It will have been a very grave and serious and dastardly thing to have done.
§ 5.56 p.m.
§ Mr. Douglas Marshall (Bodmin)
I think hon. Members will agree with the hon. Member for Pembroke (Mr. Donnelly) that there has been very little praise for what is contained in the various Statutory Instruments we are discussing. A great deal has been said about research, of which all hon. Members agree a lot more should be done. We should bear in mind, however, the reason why research into the fishing industry has not been accelerated to the same extent as research into agriculture. It is because in time of war the seas become dangerous and isolated, and, consequently, research has been concentrated on the land instead of on the sea. I trust that my right hon. Friend and his hon. Friend the Parliamentary Secretary will pay attention to that fact and will appreciate that during peacetime there must be acceleration of research in order that we may know a great deal more about the fishing industry than we know at present.
§ The question of whether the herring are disappearing or not, or whether they are of some political shade, is not important. There was an increase in numbers in the time of Henry VIII, which began to disappear in the latter time of Elizabeth I. That had nothing to do with the mesh or the net or with 261 political philosophy. It may be that the herring wanted to get to a warm sea in order to find more food, which is a natural thing for wild life to do.
§ I shall concentrate my remarks on one aspect of the Statutory Instruments under consideration. I am sorry that I must criticise my right hon. Friend the Minister on this subject. I regret it because, although he may not be aware of the fact, I have a respect for him, and I am sorry that on this occasion we cannot look at the point in the same way. It is true to say that when we are discussing an Order which gives a subsidy to the fishing industry generally, we cannot move any Amendment. It is impossible to vote against an Order since, if it did not become law, that would more or less smash the fishing industry. Therefore, we are in a dilemma, and the point I wish to raise with my right hon. Friend, strangely enough, does not necessarily mean that the application of the subsidy, which I would like to see, would cost any more than lies within the Order.
§ I believe that a different application of the subsidy should take place. Under this Order, Mr. Deputy-Speaker, you will have noticed that "white fish" includes all fish, with the exclusion of certain specified fish. In other words, there are many pelagic fish which fall outside what I might call the herring section and which fall within the white fish industry. There are those which wriggle their way through the water and which are combined with those that flap their way through the sea. It is about the pelagic side that I want to speak this afternoon.
§ The subsidy included in one of the Statutory Instruments, the one for the pilchard industry, was running last year at between £14,000 and £28,000 per annum. Expressed in a percentage, that is, in a number of ways, quite a good subsidy. In other words, it represents roughly 20 per cent. of the catch. This in itself, as I see it, means that the Minister fully realises the need for such a subsidy; otherwise, it would not be included in one of the Statutory Instruments.
§ Secondly, the Minister could not have any objection to a variation in the way the subsidy should apply because the Fleck Committee has not yet reported. One of the major attacks in the House 262 this afternoon against certain alterations in the arrangements has been put in the form of the question asking why these alterations have taken place when the Fleck Committee has not reported. Therefore, of course, he could not possibly object to altering the form of subsidy simply because the Committee has not reported.
§ It might be argued by the Minister that to alter the subsidy in the way I wish to suggest would mean that it would be difficult to control, and the method which I am about to suggest might lead to a certain number of people taking advantage of it. This would be a very strange argument indeed, because, at the present moment about 80 per cent. of the white fish industry has the method which I have in mind. It might be argued that there is a difference because the type of vessel employed does not, by its nature, go out for quite so long. Such an argument would not be a very wise one to use because, when all is said and done, the Admiralty laid down a very long time ago the definition that an inshore fishing vessel would not have that description determined by its size but by the fact that, on its normal occasions, it did not remain at sea for more than 36 hours. Therefore, that argument against any difference would not apply.
§ There has been a great deal of thought about how the pilchard industry could be helped. Some years ago, we set up the White Fish Authority with the idea that it would be able to concentrate on such matters and recommend to the Minister for his consideration what it thought was best. I readily agree that the Authority recommends and advises and that it is for the Minister himself to decides whether he accepts its recommendations.
§ The recommendation of the White Fish Authority to the Minister was, as far as I know, backed by the Ministry of National Insurance. It was certainly backed by the fishing industry itself, and it was backed by the county fisheries committee which represented the fishing industry. At that moment, therefore, the point which I am about to put had the support of the White Fish Authority, it had the support, as far as I know, of the Ministry of National Insurance, it had the support of the fishing industry and it had the support of the county fisheries committee.263
§ I ask the House to consider what this recommendation was. At the present moment, within the present arrangements, there is a figure provided which is exactly the same as it has been in the past, namely, 8d. per stone for the pilchard industry. This is the figure which relates to the total sum I have already mentioned, £14,000 to £28,500, or 20 per cent. of the normal catch last year. But here arises the real difficulty. Pilchard, like herring, disappear at times. We do not know why. I think I am right in saying that in the days of Elizabeth I a speech was made in this House about the disappearance of the pilchard. These things happen. The fishermen are share fishermen, and they have to decide whether to go out to hunt the fish—because that is really what they do—or stay at home.
§ When the fish are in abundance, the 8d. a stone is perfectly all right. The more abundant the fish, the better that system is. The main object of the levy is to steady the industry and lessen any real hurt to it. But the hurt comes when the fish are found not to be there. The fishermen are faced with a dilemma. Shall they go out and search for the pilchard at times when it seems that the pilchard, for some reason which no one knows, are not there? If they go out for only half a week they are not unemployed during the second half of the week, and they have quite rightly, to bear the cost of the stamp because they are employed and they receive no unemployment benefit.
§ All in all, the share fishermen in their vessels are confronted with a quite extraordinary and exceptional position, in that it pays them not to go out to fish. Therefore, being reasonable men, they put their suggestions to the White Fish Authority. The Authority agreed with them, taking into consideration this state of affairs, and said that it might well be much better to put this subsidy in exactly the same form as the subsidy in respect of the remaining 80 per cent., letting the subsidy fall on the vessel proceeding to sea to fish, thereby giving the incentive to go out and fish. This is surely the most reasonable way to treat it.
§ There is the other factor, that the pilchard fishing industry is today maintained by the canning section. The question of salting the pilchard for the 264 Italian market, which we all used to know about, has gone. The whole run of a canning factory's work and the fish coming into the factory for canning must be kept at an even level. Once again, from that angle, it would be very much more sensible and reasonable to put the subsidy upon the vessel instead of upon the catch.
§ I feel very strongly on this point for two reasons. Although only a few Members of Parliament actually represent the areas where pilchard are caught, the pilchard industry is part of the pattern of our national life. It always has been so. Not only does it help to provide variety in our food, but it provides also what many hon. Members have spoken about from time to time, namely, the type of men who man small ships, men whom this nation has at times been extremely grateful to have. What the industry, backed by the White Fish Authority and by the county committee, wants to promote and maintain, without of necessity costing the Treasury any more money, is refused by Her Majesty's Government. I cannot see the reason for this. It cannot be that they are awaiting the report of the Fleck Committee because action has been taken in other directions. I regret this decision by my right hon. Friend.
§ 6.10 p.m.
Mr. F. H. Hay man (Falmouth and Camborne)
As a Cornish Member, I rise to support what the hon. Member for Bodmin (Mr. D. Marshall) has just said. From time immemorial the pilchard industry has been one of the staple industries of Cornwall. One of our mottoes used to be to the effect that our chief industries were copper, fish and tin. When we speak of fish we really mean the pilchard, which was the staple article of diet for the working classes almost to the end of the last century; but I need not dilate on that now.
The hon. Member for Bodmin has explained what the Cornwall Sea Fisheries Committee, in conjunction with the White Fish Authority has in mind. Both these bodies have pressed on the Minister a fresh scheme for a subsidy arrangement which they believe would be of far greater benefit to the industry than the present subsidy, which subsidises a night's catch. The present 265 Scheme can sometimes be of benefit at a time when fish are plentiful, but it provides nothing when the boats return with little or no fish.
The proposals made by the White Fish Authority are based on the nightly or daily trip in the same way as the Herring Board caters for the herring boats. Surely that is not too much to ask and for the life of me I cannot understand why the Minister has boggled at this suggestion. There is great uncertainty and uneasiness in the fishing ports of Cornwall. The Cornwall Sea Fisheries Committee has been a very live and active committee all through the years, and is in close touch with the fishermen themselves.
As the hon. Member for Bodmin said, the White Fish Authority has set up a Pilchard Industry Development Committee. The chairman of the Cornwall Sea Fisheries Committee and leading fishermen of Cornwall are members. This is the type of thing which the White Fish Authority was set up to do, but at a time when it is making a suggestion of real benefit to the industry the Minister says, "No." I cannot understand why the Minister has done so, but perhaps he will explain the position later.
The canning industry, which is ancilliary to the fishing industry, faces severe competition from South Africa, to some extent from Japan, and from California. What the Minister is doing in another Department of his Ministry in regard to the pig industry is causing great concern amongst us. As I said last week, we have severe unemployment in West Cornwall and these things, added together, are causing great anxiety in my constituency and in the County of Cornwall.
§ 6.15 p.m.
§ Mr. G. R. Howard (St. Ives)
The hon. Member for Falmouth and Camborne (Mr. Hayman) is fortunate that he has just returned to the Chamber and missed much of the debate which has been devoted to Scotland.
§ Mr. Hayman
I was absent because I was attending a Committee upstairs which is very concerned about the pig industry.
§ Mr. Howard
I was only saying that the hon. Member was lucky in missing a 266 large part of the debate, which was devoted to Scotland.
I am glad that we are having a chance to voice some of our worries about the West as opposed to the North. May I add my word of thanks to the Government for letting us have this debate at a sensible hour, and congratulate the hon. Member for Lowestoft (Mr. Edward Evans) and say how glad we are to see him making the opening speech from the Opposition Front Bench, because nobody has done more for the fishing industry than he has in his long years of service.
I should like to carry further what has been said by the hon. Member for Bodmin (Mr. D. Marshall) and the hon. Member for Falmouth and Camborne. The first problem in the fishing industry is the disposal of the catch. This must be done at an economic price if we are to compete with imports from South Africa, California, and the admittedly small token imports from Japan, though some of us are worried that these token imports may be increased.
The White Fish Authority has, with considerable difficulty, put over a pilot scheme—which we think might be a good thing—to explore new methods of fishing in the west of the Channel. It is not much good, when one has tried hard to sell this story to local fishermen for the Government to turn down the White Fish Authority's proposals on this change in the subsidy rate. The fishermen ask what is the good of having this pilot scheme if it appears that the Government take no notice of the White Fish Authority's proposal for the change in subsidy.
The problem of unemployment benefit is a difficult one. On the present subsidy rates, will a man be prepared to go to sea and risk losing his unemployment benefit? I am not saying that we ought to advocate that the fishermen ought to stay in harbour and get the unemployment benefit, but these men are human and if it is problematical whether they will catch fish it is obvious what they will do. I raise this next problem every year and I make no apology for doing so again.
Shell fishermen are not included in the subsidy. We are told that this is a luxury, but so is sole, turbot and other fish which come under the White Fish 267 Subsidy Scheme. One has the same fishermen fishing in the same area with the same boats, gear and everything. One gets a subsidy and the other does not. If the Government cannot soften their heart, at least let us look into the question of viviers, where shellfish can be kept alive and healthy for up to three months. This is done in France. It is not expensive and quite easy to do, and I think that the Government can help the shell fishermen by looking into the provision of such a facility.
The last problem is to explain to the fishermen why we cannot have base lines. They see the Icelanders getting away with it. There is a great deal of international talk, but no international action, and the fishermen ask why we do not do the same, because this would stop the Frenchmen getting into Mount's Bay and taking a large share of the available lobsters.
Why cannot we have base lines? If we make a new approach and say that we will examine the problem again from the point of view of base lines instead of the three-mile limit, we may have a new basis for discussion, but it is very difficult to put over to inshore fishermen the fact that what goes for other people does not go for them. This country always seems the last to do anything of that sort, because it is frightened of upsetting somebody. Others who are not so frightened get away with a lot more.
Under the present subsidy arrangement—and I am glad that it has not been cut—we have the problem of unemployment benefit. As was said by my hon. Friend the Member for Bodmin and the hon. Member for Falmouth and Camborne, we have a scheme put up by the Cornwall Sea Fisheries Committee and the White Fish Authority, which itself was set up by this House to advise upon the fishing industry. This scheme is to change over from the 8d. a stone basis to the daily payment basis. The proposal was a fairly reasonable one. The subsidy was to be £2 in respect of boats from 18 to 21 feet and £6 10s. for the 40-foot boats. A letter addressed to me from the clerk of the Cornwall Sea Fisheries Committee says:The proposed revised rates of subsidy agreed at the meeting are based on the pilchard fishery costings investigations carried out by the White Fish Authority and on the sizes of boats normally used in this type of fishing.268 The letter continues:These rates would, in general terms, give a return of 15s. for each member of a boat's crew for each night spent at sea, irrespective of the quantity of fish landed.The letter further states that this would encourage the fishermen to go to sea, and that it ought not to cost very much more than the present arrangement. I cannot see why this matter has not been agreed to by the Government.
When I wrote to the Minister on the subject at the beginning of June I received the reply that the Minister would give the matter careful consideration. Now we are turned down, on the excuse that we must wait for the report of the Fleck Committee, although the other subsidies can apparently be changed without waiting for that report. It is always the same old story: what is fitting to do in one respect is not fitting in another. We have been waiting two years for this report, and I suppose that if we are still here next year we shall have the same debate and shall still be told that nothing can be done because we are waiting for the report of the Fleck Committee.
What is the good of the White Fish Authority putting up this pilot scheme to look into new methods of fishing? That scheme may mean that we shall need new boats, with new types of gear. It is doubtful whether the existing boats could trawl with the necessary gear. They would probably need stronger gear and winches, and bigger boats. We do not know. We cannot sell this sort of story to the local fishermen if, on the one hand, we tell them that the White Fish Authority is a splendid organisation which has put up this pilot scheme to help them, and then, on the other, that we are not taking any notice of what the Authority recommends because the matter is one for the Government.
The Government have been able to help us in one small way. We asked for help in the building of a slipway at Newlyn and we received it. I want to ask for one more thing before I finish. It is a well-known Government procedure for a Minister to say that it is not his job, and that inquiries should be addressed to somebody else. For a long time I have been trying, on behalf of the Newlyn and Mousehole Fishermen's Association, to get radar assistance, with 269 a beacon on the Wolf Rock. Unfortunately, the Ministry of Agriculture, the Ministry of Transport, and the august body known as Trinity House have each, in turn, said that it is not their responsibility. I tried to shame Trinity House the other day by saying that we would pay for the beacon if Trinity House would instal it, but it transpired that the only installation we would be allowed was one with a range of only 10 miles, and the fishermen did not think that that would be any good.
The fishermen say, "If we cannot have that let us have a light and a fog signal on Carn Dhu. This would be some aid to navigation for fishermen approaching Newlyn Harbour". I could not agree more. The lights in the area are so bad that on a trip in the Trinity House vessel I was told that she came into Penzance by the lights on Morrab Road, because they were the only ones they could see. I have no doubt about that, having seen them from seawards myself. The Association has written to me about the erection of such an aid to navigation. It says:We ask you now to take this up on our behalf and legislate for funds to be made available for aids to navigation for fishing vessels. Though we are stressing our own particular need we feel that there is a special need nationally for such a fund, which is not covered by the Fund for General Navigation administered by Trinity House.I ask the Government to do something about that.
We cannot vote against this White Fish Subsidy Scheme, because it has been said that if we do the fishermen will not get anything. We must, therefore, reluctantly support the existing arrangement. Nevertheless, I hope that we will not be given the same answer next year, namely, that the Government are waiting for the Fleck Committee's report. Let us re-examine the proposal for daily payment. I believe it is right. That is not important. The Cornwall Sea Fisheries Committee thinks it is right, which is more important, and the White Fish Authority thinks it is right, which is most important. If the Government have confidence in the Authority they should follow its advice. If not, they should scrap it.
§ 6.27 p.m.
§ Mr. Michael Noble (Argyll)
When I listened to the hon. Member for Lowestoft (Mr. Edward Evans) opening the debate 270 I was frightened by the number of things he listed as being out of order. I hope that I may receive a little indulgence if I stray from the strict paths of what is proper in this debate. First, I thank the Government for the help they have given my fishermen in building the harbour in Carradale. My hon. Friend the Member for St. Ives (Mr. G. R. Howard), although perhaps disappointed at the fact that the debate has turned north again, will at least have some sympathy with me, in that we are still on the West Coast.
Those of us who know the West Coast of Scotland appreciate that one of the most important things is to get the fishing industry going there again, both in regard to employment, and the money that it will bring. It is satisfactory that this small band of fishermen at Carradale, having increased the number of boats fishing from there, have been rewarded by Government help in the completion of their harbour. All the fishermen who come from my area have one particular point of interest. In these debates my predecessor and others have for many years asked the Government to consider putting an "A" port in the Clyde area. The Argyllshire fishermen are not jealous about this. Although they would, naturally, prefer it to be at Campbeltown, or Tarbert, they would be quite satisfied if it were provided in the Clyde area, because—
§ Mr. Speaker
The hon. Member is now straying beyond the bounds of order. There is nothing in the Scheme about provision for harbours.
§ Mr. Noble
Thank you for your Ruling, Mr. Speaker. I was afraid that I might be transgressing a little.
My second point, which I hope is within the bounds of order, concerns the size of the boats for which the subsidy is paid. The Clyde Fishermen's Association has written to me and I have sent on the letter to my noble Friend. The association feels that a great help would be given to the industry if the size of the boat, which, at the moment, is 40 ft., could be reduced to 39 ft. I know that in these things there must be a limit, otherwise abuses creep in, but I believe it to be true that, were a small reduction made in the size, only a comparatively small number of boats would be affected, but it would give great satisfaction in the 271 area. I suppose that the alternative would be to add a small bit to the bow, but that might be illegal.
A point which worries many of us is whether the subsidy should be given in cases where the catch consists largely of immature fish. If I pursue that point further I shall go beyond the scope of this debate, but I hope that in mentioning it I am in order.
I should like to follow what was said by my hon. Friend the Member for St. Ives about shellfish. In the past there has been a considerable quantity of shellfish available on the West Coast, and at one time a number of boats took advantage of that fact and made a good living from that type of fishing. It is a deplorable fact that today a great many of the boats engaged in fishing for shellfish come from France or Belgium, or some distant country, to make a living off the coast of Scotland.
The Government should encourage the local fishermen in some way. Perhaps the only way to do that would be by a subsidy, though I cannot believe it is the only effective way, because if boats can come from abroad and make a living surely our own boats could do the same. But I feel that in some way this type of industry should be encouraged. I hope that the fishermen on the coast of Argyll and further north, round the Islands, will be re-established in this industry and gain a profitable livelihood for themselves.
§ 6.32 p.m.
§ Dame Irene Ward (Tynemouth)
I wish to preface my remarks by associating myself with what was said by my hon. Friend the Member for North Fylde (Mr. Stanley) about the great services rendered to the fishing industry by the Royal Navy. The fishermen whom I try to represent feel that they owe a great debt of gratitude to the Navy and it is important that when such services are rendered the fact should be mentioned and the thanks of the House conveyed to the Navy. I wish to talk about the port of North Shields—
§ Lord John Hope
I do not disagree with anything which has been said by my hon. Friend the Member for Tynemouth (Dame Irene Ward), but the reason why the Government have said nothing about what has been done by the Royal Navy 272 for the fishermen is because they did not think that such a reference would be in order in this debate. I do not wish to embarrass my hon. Friend, but it is a little awkward if, the Government having said nothing, one or two back bench Members say that something should be said about the Royal Navy. In another context, the Government would be only too pleased to say something about this important matter.
§ Mr. Speaker
I do not think that the great services rendered by the Royal Navy, which are acknowledged by everyone, is a matter which is strictly germane to these Statutory Instruments. No doubt an occasional reference might be in order. It might be argued in some way or other that owing to the restricted ground over which our fishermen now have to fish, the call for a subsidy is greater than otherwise it might have been. But it is not for me to put ideas into the heads of hon. Members. I think that the hon. Lady should content herself with what she has said, which, I think, represents the view of the House.
§ Dame Irene Ward
Thank you, Mr. Speaker. As a matter of fact, I had passed from that point. But I am grateful for the intervention of the Joint Under-Secretary. I have always believed that there are ways and means of doing things in this House if one wishes to do them, but perhaps we had better leave it at that.
I wish to discuss the problem of the port of North Shields. I am in something of a quandary, because when I came back to the House of Commons in 1950, I found that my constituency contained this important and ancient port. On occasions when matters relating to fishing have been raised the Minister concerned has said that the great and grave problem in North Shields was to keep the port alive because of the decline in the number of trawlers and the amount of fishing carried on from that port.
Nothing has ever been said about the old vessels which operate from that port. In 1939 there were 60 trawlers. We take second place to no one in the country, but I recognise that from the point of view of fishing the port of North Shields has always been a small one. There are now 17 trawlers attached to the port; 273 16 of them are coal burners and there is one diesel-engined trawler. The port is unique in that the local authority owns the fishing quay, and in order to sustain the port it has spent a considerably amount of the ratepayers' money on the quay. Therefore, the local authority is interested in what the Government propose to do to help the fishing industry.
Our problem has been that the families of trawler owners which have always been associated with the fishing industry have, in recent years, not wished to continue their connection with that industry. I am not referring now to the small men who have invested their savings in one or two trawlers, but to families who have always been associated with the industry. Now there are no sons to follow the fathers, and there is anxiety about the future of the port.
I am glad to say that there has suddenly been a revival. One of our major firms has started to build six diesel vessels. One has already been built and is in commission. Like the hon. Member who spoke for Milford Haven and my hon. Friend who spoke for Fleetwood, I agree that it is very important to keep a balance in the port when we are building our new diesel vessels. They cannot be built in a very short time, and we fully recognise that we are late in starting. I should have thought that my right hon. Friend would have been very gratified that his anxieties for the port of North Shields have now been removed, and that instead of making it more difficult for us to keep going he would have been only too delighted to give us the maximum support.
I am told by those who are in the industry in North Shields that by the reduction of our coal-burning trawlers from 60 to 16 we have been doing more than the Government asked us to do. It is unfortunate if that is so. We have reduced the number of coal burners at almost too rapid a speed and we are in danger of getting the fleet out of balance. We do not feel that we can afford to allow any more of these coal burners to go out of operation and still maintain our port. By reducing our subsidies, the Government, instead of sustaining the port, are making the possibility of collapse a reality. I cannot think that that is the intention of my right hon. 274 Friend. Therefore, I am asking for reconsideration of these subsidies.
We cannot maintain trained crews unless we have a certain number of trawlers fishing from the port. It would be quite out of keeping with good commercial practice if, while we are building our new diesel vessels, our trained crews were to be dispersed, because we could not get them back again. All the employment connected with the port would be interrupted and our market contacts for fish supplies throughout the North-East Coast would be also interrupted. We would be faced with even more grave and anxious difficulties than those which we have been facing for some time. Just at the time when we felt that our difficulties were being overcome it is very hard that my right hon. Friend should hit us upon the head. It is very bad behaviour towards the port of North Shields.
In many ways I am very grateful to my right hon. Friend. He is immensely patient in listening to grumbles and he always finds time to see me and to be pleasant and nice. When Ministers are pleasant and nice I feel a little hardhearted in being so disagreeable to them. It would be very much better technique for them to be unpleasant to me. I know that I am a very obstinate creature. When I have been telling my right hon. Friend that the trawler owners cannot indefinitely run the old ships at a loss he has expressed doubts whether they were running them at a loss. He feels that the trawler owners can go on financing these ships out of their own pockets and that the Government can withdraw part of the subsidy which goes to trawler owners. My hon. Friend the Member for North Fylde said he thought the accountancy in the Ministry left much to be desired. What I have heard here this afternoon makes me feel that my hon. Friend was speaking the truth.
The extraordinary thing is that my right hon. Friend has never invited hon. Members of the fisheries committee from both sides of the House to hear him argue on the figures of the British Trawler Owners' Federation. I do not say that my right hon. Friend is wrong and the Federation is right, or otherwise, but only that I have never heard the arguments. Being a practical and logical individual from the North-East 275 Coast, I should like to hear the arguments deployed so that I could know which side I supported. I am not prepared to accept the view that the port of North Shields can carry on because my right hon. Friend thinks that the figures which have been presented to him, and which have been duly certified by a chartered accountant, do not represent what the British Trawler Owners' Federation say is the existing situation. My right hon. Friend's position seems to be weak. He has never allowed us to hear the arguments so that people like me, who are not impressed with figures, can decide which side of the industry is right.
There are two other points, one a very little one and the other an important one. The port of North Shields comes within a Development Area. The whole idea of Development Areas is that new industries shall be attracted to places where there is unemployment. It is ridiculous to take up the attitude that the Government are prepared to give money to my constituency to attract new industries there—for which we are very grateful—while refusing a relatively small amount of money to keep the old industries there alive. The fishing industry is very important to the security of this country in times of war. I cannot help wondering whether my right hon. Friend has failed in his battle with the Treasury. I do not believe that he is so unmindful of the industry of the port of North Shields as he has tried to make out in the past. I prefer to think that he has lost his battle with the Treasury.
I do not think that either commercially or logically this case has been really thought out. What on earth is the use of trying to attract new industries, to train new personnel and to take people who are unemployed from a skilled industry which is absolutely essential and vital to the country? It just makes nonsense to me. I have listened to all hon. Members who have spoken so far saying that it is impossible to divide against this Statutory Instrument. I say to my right hon. Friend, and to anyone who is prepared to listen to me, that no subsidy is of any use to the port of North Shields if the port collapses. Therefore, I am perfectly prepared to divide against this Instrument, and would cer- 276 tainly go into the Lobby against the Government. I go a step further than that. If I cannot go into the Lobby against the Government tonight because others do not feel as I do, another time will come when I shall be able to vote against the Government and get my own back on this Statutory Instrument. That is certainly what I intend to do.
I want to make two brief points about this Development Area problem. In my constituency I have seen the problem of unemployment and I know what the fishing industry in North Shields has had to put up with. I am not going to let any Minister get away with thinking that I support him or the policy that is followed. I stand for the interests of my fishermen and my fishing port. I have noticed that several Scotsmen have taken part in the debate today. I noticed that, although I could not get a tax concession for the dry docks in North Shields, the Treasury was able to give a grant for the building of a dry dock in Greenock.
§ Dame Irene Ward
With very great respect, Mr. Speaker, of course you are a Scotsman. I shall not venture into that subject, but I have noticed it.
My final point is this. I know we cannot discuss the Icelandic dispute, but I say to my right hon. Friend, as everyone else has said, that I hope we shall be able to have a fishing debate which can cover the whole scene. The fishing industry, quite apart from the question of subsidies, difficulties over catchings and so on, is in an unsettled position. Crews of trawlers, wherever they go, whether to the Faroes or to Iceland, find that it is in a very unsettled and anxious position. I say this deliberately. It seems quite the wrong time for the Chancellor of the Exchequer to try to aggravate the position of the industry, and I hope there will be a chance of registering a vote against the Government.
§ 6.54 p.m.
§ Mr. Emrys Hughes (South Ayrshire)
The hon. Lady the Member for Tyne-mouth (Dame Irene Ward) said that she was an obstinate creature. I should certainly not have accused her of that: I thought that she was rather pliable. Even so, there is no need to apologise for 277 being obstinate in politics, for it is the obstinate Member who is listened to. while the obedient and humble servant is disregarded by Ministers. The hon. Lady need not worry even if we accuse her of obstinacy, but I disagree when she says that she is practical and logical.
I have risen to voice only two grievances of my constituents. One is about the subsidy paid for boats of 40 ft. I have a constituent who owns a boat which is 39 ft. 8 ins. Because his boat is 4 ins. short of the specified length, he has been refused the subsidy. I suggest it is too bad to deprive a fisherman of a subsidy because his boat is 4 ins. too short. I asked the hon. Member for Banff (Sir. W. Duthie) how that boat could be made the required size, but it was impossible to get the Minister to agree to give this fisherman what all the other fishermen in the area were getting, simply because it was 4 ins. short. I suggest that the Minister should make his regulations a little more elastic.
Then there is the question of fishermen who now wish to restart fishing. On the West Coast of Scotland and in Ayrshire the number of fishing boats has been declining steadily, largely because there was more remunerative employment elsewhere. In some fishing villages in my constituency men who formerly made a living by going to sea have been going to work at Prestwick and have been employed by Scottish Aviation Limited at better wages than they could get by going to sea. They now find unemployment coming into those industries and the result is that they look forward to the prospect of going back to sea. When they approach the Government with a view to obtaining a second-hand boat the answer is that there is no provision for that.
I suggest that possibly there might be a drift back to fishing simply because of the breakdown of other industries on the West Coast of Scotland. I therefore ask the Minister to be a little more humane and generous in interpreting these regulations.
§ Sir James Henderson-Stewart (Fife, East)
I do not contest the remarks of the hon. Member in relation to Ayrshire, but it is not the case that fishermen are leaving industry to go into fishing because of unemployment. In Fife, there is a revival of fishing. Several ports 278 have more boats than they have had for many a long year. It is because they like fishing that they are taking it up, which is a very encouraging fact.
§ 6.58 p.m.
§ Mr. Frederick Willey (Sunderland, North)
I wish to begin with a point which, I think, will attract unanimous support. We all recognise the fortitude, and often courage, with which fishermen carry out a very tough job. I am also sure I am speaking on behalf of the whole House when I say that we were delighted to hear my hon. Friend the Member for Lowestoft (Mr. Edward Evans) making his maiden speech from this Box.
I think that I probably still have the unanimous support of the House when I say that we have every sympathy for the right hon. Gentleman the Minister. We all recognise that he has a pleasant and charming character and that he is unfortunate to be the centre of a great deal of disquiet. Perhaps hon. Members are not all unanimous when I say we believe that he has some responsibility for the disquiet which affects not only the fishing industry but agriculture and horticulture as well.
The hon. Member for Haltemprice (Mr. Wall) described this debate as a non-party debate and gave the rather naÏve description of non-party debate as being one in which we all criticise the Minister. I do not think any hon. Member who has spoken from either side of the House, in spite of the impending General Election, has been able to restrain his criticism of the Government. I was very surprised that the Joint Under-Secretary of State for Scotland, who opened the debate, was so complacent about the herring industry. Like my hon. Friend the Member for Lowestoft, I call his attention to the Report of the Herring Industry Board. On the first page the Report says:The state of the herring-fisheries of the North Sea continues to be a cause for grave concern.As far as the white fish industry is concerned, we discussed a similar Order last Session under the shadow of the Icelandic dispute. We now know that that shadow has deepened. I should like to know from the Government, as it certainly affects the scale of this subsidy, what their plans are for the second Law 279 of the Sea conference. I should like to feel that something effective is being done.
In the same way—I make no apology for raising this matter, which has been raised by several hon. Members—I should like to know what the Fleck Committee is doing. I have complained time after time of the right hon. Gentleman's Department. Whenever it is presented with a problem, it sets up a committee. In fact, I have occasionally asked it to set up a committee to force it to face up to a problem. It set up a committee two years ago. When shall we hear from the Fleck Committee? Have the Government asked for interim reports, because we certainly need them? We cannot remain in this present condition. Moreover, we have had the experience of the Runciman Committee's Report. We know that we have to wait two or three years after the receipt of this report for the Government to consider it, and we know what they will do because we have precedents. They will set up at the end of the day a committee to advise about the committee that has reported. It certainly is important that we should get some statement from the Government about the Fleck Committee's report and when we can expect the report.
When we discussed the legislation upon which these Statutory Instruments depend, we recognised that there were two basic problems. We really have heard about only one in the debate today. The two problems which faced the Government when they introduced the legislation were, first, the decreasing fish stocks in our traditional fishing grounds, and, secondly, the question of the efficiency of the fishing fleet. I thoroughly support those hon. Members who have said, "Let us have a debate regularly on fishing." Indeed, I say let us have regular debates on private industries which are subsidised. We regularly debate the nationalised industries which in fact are obliged to pay their way. It is much more germane that we should discuss those industries which regularly depend upon the taxpayer for support. That is a proper function for Parliament. We should try to get it accepted by Parliament that we ought to have regular reviews of Indus- 280 tries which receive aid from the taxpayer.
Much that we have heard this afternoon is very disquietening. Here is an industry under private control which has boats which are far too old and which has had those boats far too long after its attention has been called to it. I am not trying to stigmatise the industry, and I am certainly not making a criticism of those making a living in the industry. Of course, it is a criticism of the doctrinaire views of hon. Members opposite. The sort of things which they have said this afternoon are not the sort of things which they will say at the hustings. We have to recognise that the difficulties of the industry are very different from views put forward by doctrinaire Tory politicians. However, if the taxpayer has to accept the responsibility for aiding the industry, then the House has to accept the responsibility for regularly reviewing that industry.
Turning to the grants themselves, we, of course, welcome the extension of the aid from £17 million to £19 million. We note the provision made for the increase in the maximum grant to those who wish to build herring drifters. We can do no more than note it, because we have to recognise that none is being built. No applications have been made. That is the answer to the complacency of the Joint Under-Secretary. By that Order we are not dealing with the essential problem.
We recognised when we brought forward this legislation that one of the overriding problems was the loss of opportunities to fish in our traditional fishing grounds. We should have heard something about that and what the Government are doing, even in a debate on this Order. In the case of the White Fish Order, again we welcome the extension and the increase in the maximum of the grant to £37,500. We cannot do this very enthusiastically for a very good reason. I am tired of saying to the right hon. Gentleman that we are far too much run by the men in Whitehall. This is certainly a case of the men in Whitehall knowing best.
What do we do? We set up a White Fish Authority. It very properly received representations. It recommended to the Minister that the maximum grant should be increased not to £37,500 but to £40,000. Who on earth decided to reduce 281 it to £37,500, and on what grounds? They have not been given to the House. The Joint Under-Secretary was arrogant enough to come to the House and not even give an explanation for not accepting the advice of this Authority set up to give this specific advice. We know that this is not the advice of anyone in the Department. This is the advice of somebody at the Treasury.
I should like the right hon. Gentleman to say just how much money he estimates he will save by altering the maximum of £40,000 to £37,500. I should like to know what the estimate is. We know the basis of the calculations and how the figure of £40,000 was arrived at. I want to know why it was not accepted. Again, and it was mentioned by the hon. Member for Haltemprice (Mr. Wall), the question was raised by the White Fish Authority of extending the loans to the long-distance trawlers. This, again, is a recommendation which has been made, and if the course suggested in the recommendation has not been followed, surely we should have an explanation from the Government. This is not the right way to treat the White Fish Authority.
In considering these subsidies, I am surprised that nobody has pointed out that the Herring Industry Board made a recommendation about subsidies. It called attention to a possible alleviation of the problems of the industry by recommending more dual-purpose boats. It made recommendations about differential subsidies. Last year the Ministers said that they had not had time to consider these points. By now they have had time. Why treat the Herring Industry Board in the same way as they have treated the White Fish Authority in considering its recommendations? If these public bodies, charged with these responsibilities, make such recommendations, they ought to be seriously treated and considered by the Government and we should not have such a nonchalant brush-off by the Joint Under-Secretary.
Let me turn to a question which has attracted the major part of the debate—that of coal-burning and oil-burning vessels. I heard what the Joint Under-Secretary of State said, but, frankly, I could not follow it and I could not reconcile it with Government policy. This is a subsidy which was increased and 282 which is now being reduced for the second time. This is the reason why I could not follow the hon. Member. I wondered whether he himself could follow it. He said that the subsidy was being reduced to encourage the owners to scrap these vessels, and that the Government were reducing it because the building which the Government had expected had not taken place. Yet the whole purpose of the subsidy has always been stated by the Government to be to keep up fish supplies while the fleet is being modernised. They have said that it was necessary to keep these ships in the water and working. If we have not had the new ships built, what is the argument for withdrawing the subsidy?
I have said time after time that on these production grants we cannot alter our case day by day in this way. We must make up our minds what is the purpose of the subsidy. If it is the oft-proclaimed purpose in this case, then obviously, in those conditions, the subsidy cannot be withdrawn in this way. The White Fish Authority has made it clear that it believes that the subsidy should not be withdrawn in this way. It states thatin the Authority's view, the subsidy support now given to them should gradually be brought into line with that given to motor trawlers generally.Once again, I did not hear from the Joint Under-Secretary of State any explanation of why the Government have disregarded the White Fish Authority's advice. What is the point of setting up a public authority such as this unless we follow its advice? It is clear that all informed opinion believes that this subsidy should have been left as it was, at any rate until we have received the Fleck Committee's report. What we must accept is that it is no good the Joint Under-Secretary of State saying that we are using this change as an incentive to promote building when that was not the declared purpose of the subsidy. This is important, because the incentives to building are grants and loans, and if we have not had the building that we thought we should have then we should review our policy about them. We are not dealing adequately with the problem, because this subsidy change will not promote building but will knock out some of the owners.
283 The Joint Under-Secretary of State has failed to make out his case about building, because, in fact, the Authority's Report shows that a good deal of building is going on. That has also been shown by the contributions of many hon. Members to the debate. It is quite clear from the White Fish Authority's Report. Hon. Members who have spoken for Aberdeen have shown what is happening there. It is clear that we cannot argue that there is a lag in building at present which would justify this change, because the position is, in fact, the exact opposite. In the white fish industry there has been a spurt in the applications which have been submitted. There was a lag twelve months ago. Why penalise the coal-burning vessels because of a lag twelve months ago?
What is important to the House today is to face the problem of why there was a lag of twelve months ago. Surely there is not an hon. Member who does not know why. The reason was that it was the Government's purpose to discourage any such building. That was the whole purpose of the credit squeeze, and it affected the fishing industry even more dramatically than it affected many other industries. To quote the hon. Lady the Member for Tynemouth (Dame Irene Ward), what a lot of nonsense this is. If the Treasury wants to save money on coal-burning boats, let it provide a good reason. There may be a good reason, but the Joint Under-Secretary of State has not provided it.
Very little has been said about the fact that when we talk about rebuilding we are conditioned by shipbuilding capacity. We cannot build at a greater rate than the capacity permits. I have heard no Government explanation of how the building programme fits in with the overall shipbuilding programme, but, as we know, until recently the yards have been fully engaged. They are not now fully engaged. This is an opportunity. I think that there are signs that the opportunity may be taken, but if it is not there is a responsibility upon the Government to look at the matter positively and to say, if the capacity is not being fully utilised, what steps should be taken to see that it is fully utilised. We are all very much committed to this programme, because we have put a lot of public money into the industry and we want to 284 see the industry as efficient and prosperous as it can be as soon as possible. We also know that there are specific factors which make things particularly difficult at the moment. All this should evoke a constructive approach from the Government.
We have to consider the question of the fall in the price of scrap. In shipbuilding before, we have had formula; of scrapping and building; that is not novel. Has any constructive thought been given to it? We know quite well that before long in the shipbuilding industry this will be an issue for shipbuilding generally, but here we are particularly concerned with the question of scrap prices. Has any other formula for aid been considered? We know that, unfortunately, building costs have risen in the last twelve months and may rise again in the next twelve months. Has this been considered as a deterrent to new building? That is why I called attention to the White Fish Authority's recommendation and asked whether it was worth the candle to cut the grant figure which the Authority recommended.
We also have to pay attention, as did the hon. Lady the Member for Tynemouth, to a particular problem. Is the hon. Lady right that we are dealing here with family concerns and with the smaller companies? Have their difficulties been much greater than those of other concerns which have gone ahead more rapidly in rebuilding? If they have, then surely it is within the Government's competence to consider giving this aid differentially. This is a question which always arises in the giving of subsidies. Should we concentrate the subsidy on those in greatest need? Has their need prevented them from replacing new boats?
Let us at any rate look at this problem. We have not had a word about that from the Government. Is it a fact that the particular problems of Aberdeen, North Shields and Milford Haven demand special consideration? Having heard today's debate, I think that there is at least a prima facie case, but, in any event, let us look at this. Let us not stand by and see the family concerns and the small companies knocked out. To speak quite frankly, I believe that is the Government's intention.
If that is the case, I join with the hon. Lady in saying that we should resist it. 285 We cannot isolate this question. We cannot knock out the boats at North Shields without affecting the port of North Shields. As the hon. Lady said, we must recognise that North Shields is in a Development Area. Within a stone's throw of the port some of the Government's State-aided factories on the Chirton Estate are also facing difficulties at present. We should think also of the ancillary trades in the port. A detached view of the fishing industry appears to show that as the emerging picture.
I should like the Government to tell us just what they are prepared to do for North Shields, Milford Haven. Aberdeen, and similar ports, because it is quite clear from the figures quoted by the hon. Lady—and they were dramatic figures—that the Government are following a policy of knocking out the smaller people and the family concerns.
As I have said repeatedly, we should continually review the purpose of the production grants. My right hon. Friend the Member for Clackmannan and East Stirlingshire (Mr. Woodburn) once said something about these subsidies going back to the reign of Queen Anne. For the present purpose they go back to 1950. They were temporary, but, as the Under-Secretary anticipated, they will undoubtedly be extended. I think that there was a good deal in what Lord Boothby said about their having been built in. We need not be doctrinaire about this. I am not one of those who say that an industry cannot do without a subsidy. It is possible that the industry will depend upon a subsidy. What we have to be satisfied about is that there is a case for that subsidy.
I am not putting forward the argument that because agriculture has a subsidy so must fishing, but we must remember that the produce of fishing is competing, possibly, with the produce of agriculture. That has to be considered. We have to consider the fact that one of the purposes of these subsidies is to preserve the inshore, the near and the middle-water fleets, and perhaps we would not get a solution to this problem without some aid. If we want to keep those fleets fishing we may have to accept the provision of a subsidy to redress the balance. But what I am concerned about at the moment—because this is the main point that has been before us in this debate 286 —is the present concentration of these subsidies on obsolescence.
I was far from satisfied—and I say this with all respect—with the statement of the Under-Secretary. In the first place, it was one of those airy-fairy explanations that come pat out of the Department. That is very disappointing, as it shows a lack of serious thought, particularly when, in some instances, the White Fish Authority is being overridden. It also shows a lack of the will to get to grips with the problem of obsolescence. It has become as clear as day from this debate that one of the most important factors is interest rates and credit.
We have not had any comfort from the Government about that. It is quite clear that the rise and fall of building has been related to the rise and fall of interest rates. There is, therefore, an arguable case for some form of credit institution to finance this—that the subsidy could be better expressed in terms of interest rates—but about that we have had nothing from the Government.
Again, there was certainly something in what my hon. Friend the Member for Edinburgh, Leith (Mr. Hoy) said about building standard boats. I do not profess that to be easy, although it is often put as a solution for shipbuilding difficulties. It is extraordinarily difficult to build to standard specifications, but there is something in a possible formula linking scrapping with building.
It was very disappointing that, until the hon. Lady spoke, no emphasis had been placed on the social aspects of the industry's present difficulties. It is clear enough that some ports are being threatened by the Government's action tonight. I recognise the difficulties we are all in as a result of our not being able to define our requirements. I can only add my voice to that of my hon. Friend the Member for Leith, and to those of the hon. Members for Banff (Sir W. Duthie) and for Orkney and Shetland (Mr. Grimond) in saying that we want an assessment of the size and pattern of our fishing industry.
That is just what the Fleck Committee was asked to do. It is most unfortunate that, after two years, we are driven to accept steps that will affect the size and pattern of the industry. It is all very well for the hon. Member 287 for Aberdeenshire, East (Mr. Wolrige-Gordon) to laugh about this. This difficulty will affect his constituency just as much as it will some of the other ports. As I was saying, we have been taking steps this year and last that will, in fact, affect the size and pattern of the industry.
There is, therefore, every reason for saying that pending the Fleck Committee's report there should have been a standstill in the subsidy arrangements. It is unfortunate that some sections of the industry will be prejudiced, although it is quite clear from the debate that the whole House wants an efficient and competitive industry, and that the issue of subsidy is not a doctrinaire one that will divide us. But the sooner we can get this report, and the sooner we can get a broadly-based debate on the report, the better it will be.
Meanwhile, unfortunately—and in spite of the invitation of the hon. Lady—we have to accept these Statutory Instruments. But I hope that, even before the Fleck Committee reports, the Government will pay serious regard to the very difficult problems affecting one of our basic national industries.
§ 7.29 p.m.
§ The Minister of Agriculture, Fisheries and Food (Mr. John Hare)
I think that everybody who has taken part in this debate will agree that it has been very interesting. I should like to thank the hon. Member for Sunderland, North (Mr. Willey) for his kindly remarks about my personality, and to say that I join with him in congratulating the hon. Member for Lowestoft (Mr. Edward Evans) on his maiden speech from the Opposition Dispatch Box. He is a very old friend of many of us on both sides of the Chamber, and although, naturally, I did not agree with everything that he said, I think that he made a very fine debut.
The one point common to all this discussion is that no one seems to have gone out of his way to congratulate the Government on their subsidy policies. I was wondering what the reason was. I suppose it was my hon. Friend the Member for North Fylde (Mr. Stanley) who put his finger on the spot. He said that all of us in each one of our constituencies where fishing is concerned have our own difficulties. We have heard nothing except 288 of the difficulties which affect us on the fishing side in each of our constituencies. Perhaps the broader picture, rather than the constituency picture, has not been very much enlarged on.
Anyone listening to this debate would have gained the impression that the Government were doing absolutely nothing to help the fishing industry. There has been criticism after criticism after criticism. The people making the criticisms seem to forget that one of the Statutory Instruments which we are discussing is to provide for an increase of £2 million in the money available for subsidy from £17 million to £19 million, because the money which we have spent in supporting the fishing industry is running out, and we shall probably have spent by the end of 1960 the money which the House agreed was sufficient to cover the needs of the fishing industry up to 1963. It really is neither fair nor correct to say that the Government have been niggardly in their support of the industry. They have gone further than both sides of the House agreed was necessary only two years ago when the 1957 Act was passed.
Much of the debate has been concentrated upon the cut in the coal-burning subsidy. The hon. Member for Edinburgh, Leith (Mr. Hoy) said that it was disgraceful that such substantial cuts had been made in the coal-burning subsidy. That lends weight to my view that perhaps some hon. Members have rather exaggerated their case, because we are making a very modest cut in this subsidy. As my noble Friend the Joint Under-Secretary of State pointed out at the beginning of the debate, these cuts will vary from 5s. to 30s. per day and will represent an average cut of only 7 per cent.
On the other hand, I sympathise with the concern that many hon. Members have expressed about this. My hon. Friend the Member for Aberdeen, South (Lady Tweedsmuir), in a very balanced and temperate speech, explained some of the difficulties which we were facing. She said that we must try to seek a balance. Although many hon. Members on both sides of the House do not agree with my conclusions, that is exactly what I have been trying to do. We have to try to calculate the subsidy rates very carefully.
289 My hon. Friend the Member for Tyne-mouth (Dame Irene Ward) asked me whether I accepted the figures for trading profits and losses supplied by the trawler owners. I assure my hon. Friend that I certainly do not want to give any impression that I think those figures are anything but an accurate statement of operating accounts, but we really must look at the problem realistically. We must look, not only at the operating accounts provided by the trawler owners, but also at the effect which the rates of subsidy which we have fixed are having on the composition of the fleet. The fact remains that the coal burners have not been going out fast enough. In those circumstances, we should not have been justified in refraining from making the moderate cut which we have proposed.
The hon. Member for Sunderland, North said that the fact that these vessels have not been going out quickly enough was all due to the credit squeeze. The hon. Member should look at the figures. In 1957, fifty-one coal burners were scrapped. In 1958, forty-one were scrapped. It can be argued that perhaps that was due to the credit squeeze; but I would point out that in the first six months of this year only fifteen have been scrapped. I believe that answers the question which the hon. Gentleman put to us. It suggests that, at the present subsidy levels, there is perhaps not sufficient inducement to owners to take these vessels out of commission.
My noble Friend the Joint Under-Secretary said that perhaps we should be accused of not having made a sufficient cut. I was particularly anxious—and so was my right hon. Friend the Secretary of State for Scotland—that we should take into account the particular circumstances of ports like Aberdeen, Milford Haven and North Shields, where there is a special problem. It was for that reason that we made what many people might consider are rather moderate cuts.
§ Mr. Hector Hughes
The right hon. Gentleman is dealing with various ports. Does he realise that the needs of the ports vary?' Is it not rather hard on a port like Aberdeen, which is doing well in its change-over from coal- to oil-burning ships, to be treated in the same 290 way as other ports which are not doing so well? Would it not be possible to have differentiation?
§ Mr. Hare
That point has been raised before. All that I can tell the hon. and learned Gentleman is that I believe that I am doing what is fair and best for the fishing industry as a whole.
Some expressions of opinion on this subject in today's debate were far too gloomy. I do not think that those expressions of gloom will help the fishing industry very much. I do not believe that the moderate cut which we are making this year will have any more drastic effect than to accelerate by just a little the rate at which the coal burners leave the fleet.
This is a policy to which we are all committed. Time after time hon. Members on both sides of the House have said that it must be our policy to try to assist in replacing the old by new, modern-type vessels if we are to face the future with any confidence.
I turn from the coal-burning subsidy to pilchards, a subject which was raised with very considerable interest by hon. Members whose opinion I respect very much—the hon. Members for Bodmin (Mr. D. Marshall), St. Ives (Mr. G. R. Howard) and Falmouth and Camborne (Mr. Hayman). It was suggested by those hon. Gentlemen that pilchard fishermen should be paid a daily rate of subsidy instead of a stonage rate. I know that there are arguments in favour of that. They were put forward very eloquently by my hon. Friend the Member for Bodmin in particular. Pilchard fishermen depend very much on the demand from canners, and the canners buy at a fixed price. That means that the fishermen do not gain the benefit of higher prices when supplies are low. Moreover, they cannot always sell the whole of their catch when fishing is good.
The White Fish Authority has suggested to me that I should make the change suggested by those hon. Gentlemen in the method of paying the subsidy so as to even out the pilchard fishermen's income. But the argument that, because the White Fish Authority has made that recommendation to me, I should automatically carry it out is very dangerous. 291 I am sure that it is not an argument which hon. Gentlemen, if they were to take office, would accept. After all, the responsibility for these matters must rest with Parliament and the Minister responsible, and not with the statutory authority.
§ Mr. Hayman
Surely the right hon. Gentleman is basing his refusal to accept the advice of the White Fish Authority on the fact that the Fleck Committee at some time in the distant future will report on this? Can he not accelerate the report of the Fleck Committee?
§ Mr. Hare
I was about to explain why I was rejecting these arguments, and I will endeavour to do so.
There are, in the first place, a great many pilchard vessels and they are small vessels, operating from small ports. I do not think there is much in the argument that, because 80 per cent. of the white fish subsidy is paid in daily rates, the subsidy for pilchard vessels should be paid in the same way. That argument is misleading because the bulk of the subsidy goes to larger ships concentrated at a small number of ports. In view of the large number of pilchard vessels and the number of ports from which they operate, nobody can deny that there would be a real difficulty in checking their times of arrival and departure and determining what actually had been happening.
Again, their operating costs are low compared with the other sections of the industry. To pay a daily rate would undoubtedly encourage fishing merely for subsidy purposes rather than for making larger catches. There could be great danger in that. Then, once we had given a daily rate to the pilchard fishermen, it would have to be extended to a large proportion of the other white fish inshore boats. I can assure hon. Members that I have gone into this matter very carefully and I do not think that a major change of this kind would be wise at this moment. We shall, of course, review the position again, as we shall in the case of all the fishing subsidies, when we have the report of the Fleck Committee, about which I shall say a little more later on.
I should like to say a few words on the subject of depreciation. A number of hon. Members have criticised the depre- 292 ciation allowance being as low as 6⅔ per cent. per year. That is the figure which we take in our calculation of operating costs. I do not accept this criticism. The rate of 6⅔ per cent. assumes a life for these vessels of fifteen years, and I do not think that hon. Members would expect that these vessels would be scrapped in fifteen years. I think that after consideration hon. Members will agree that this allowance is pretty reasonable.
A number of hon. Members, including my hon Friend the Member for Banff (Sir W. Duthie), the hon. Members for Lowestoft and North Fylde, and the hon. and learned Member for Aberdeen, North (Mr. Hector Hughes), raised the question of rates of interest on loans, and other hon. Members who may not have raised this topic will probably be interested in it. It has been said that it is unfair that trawler owners who borrowed money when interest rates were high, should be saddled with these high interest rates throughout the period of the loans, but we must remember that the Government have to borrow the money which the White Fish Authority lends to the industry. The rates which the Authority charges, therefore, reflect the rates at which the Exchequer itself can borrow for corresponding terms. If we agreed to charge the trawler owners less than the rate at which the Exchequer itself could borrow, we should be using the loan scheme to give the industry an additional concealed subsidy. That is not the purpose of the loan scheme.
§ Mr. Edward Evans
I dealt with this point at some length in my speech. The request of the trawler owners who wish to buy new vessels is that they should negotiate a new loan, repaying the old one and getting the new loan at a lower rate of interest. I do not see anything immoral or difficult in that. It is a question of negotiation.
§ Mr. Hare
But the Treasury has already borrowed this money, which in turn has been passed to the White Fish Authority, for a given period of a certain number of years. Therefore, that money is outstanding at that rate of interest for that period of years. The hon. Gentle-roan's proposition is not as simple as he suggests.
I hope the House will agree with me that the purpose of the scheme is simply to provide a source of capital for owners who cannot borrow commercially on reasonable terms. The need of the near-and middle-water fleets for direct financial assistance is met not by the loans scheme but by the grant arrangements and by the payment of the white fish subsidy.
Some hon. Members have suggested that the rates which the Authority charges ought to be related to the Bank Rate. I cannot accept that suggestion. Given the fact that the Government have themselves to raise the money which the Authority lends, surely it is only reasonable that the Authority's lending rates should be tied to the rates at which the Exchequer itself can borrow for corresponding terms.
There was also a great deal of comment on the question of the ½ per cent. interest charge. Several hon. Members have criticised the White Fish Authority because it adds ½ per cent. to the rate of interest charged by the Exchequer before re-lending the money to the industry for building new vessels. This margin is intended to cover the Authority's costs of administering the loans and also to provide a fund against possible bad debts. It has been suggested that these costs of administration should be borne not by those who borrow from the Authority, but by the Authority itself and so by the industry as a whole through the Authority's levy.
I think two points emerge from this. As to the ½ per cent. being too big a margin, the answer is that when the Authority was charging ¼ per cent. it found that the margin was not providing enough money to cover the Authority's administration costs. The margin would, therefore, have had to be increased simply to cover these costs. It seems to me only prudent that the Authority should also make some small provision against possible bad debts.
294 As to the other point, whether the costs of administering the loans should be borne by the Authority, I do not think it is unreasonable that those who get the benefit of these loans—which are made available at rates which compare favourably with the rates which they would be charged elsewhere—should be asked to bear the costs which the Authority incurs in administering them. The Authority, in any case, has a great many other activities which have to be financed out of its levy. It carries out research. It provides training facilities for new entrants to the industry. It helps cooperative concerns. It also carries out a great deal of publicity designed to increase the consumption of white fish and to improve conditions in the industry I do not think it would be right to ask the Authority to bear also the cost of administering these loans.
I was also asked about the grants ceiling. I was accused of being very niggardly and mean in not having increased the ceiling to £40,000 instead of £37,500. I really do not think hon. Members are being fair in their criticism. Three years ago the ceiling was raised from £25,000 to £30,000. Now we are making a very substantial increase from £30,000 to £37,500. If we had raised the ceiling to £40,000, I am sure that we might well have been asked for £45,000. The trouble is that we never get any thanks for anything we do. I would suggest that the increase we have made is a very useful contribution to the well-being of the industry.
§ Mr. Edward Evans
That is admitted, but will the right hon. Gentleman explain why he did not take the advice of the White Fish Authority, which was unanimous about it?
§ Mr. Hare
I would only point out that this rate of increase does coincide with the rate of increase in building costs during the period. For that reason I think that it is a sound figure.
A number of hon. Members, my hon. Friend the Member for Banff in particular, raised the very important matter of fishery research. I thought that my hon Friend was a little unkind in saying that we were playing with research. This is not true. There are major Governmental laboratories at Lowestoft—which the hon. Member for Lowestoft knows very 295 well—and Aberdeen for white fish and herring, and at Burnham for shellfish. Expenditure on research is about £600,000 a year. Including marine biological research conducted at grant-aided research institutes at Plymouth, Millport and elsewhere, the Government spend nearer £1 million a year.
The Departmental laboratories have fishery research vessels working on problems concerning shellfish, pilchard and sprats around the coast, on herring in the North Sea, and on white fish in various waters extending as far north as the Arctic. It is not fair to say that we are doing nothing about research, but I do agree that it is extremely important, in any debate on fishing, to stress the need for efficient and progressive research in all these respects.
The hon. Member for Lowestoft, I think, took the view that conservation was of even greater importance than research, particularly as regards herring. In my view, he is right to point out the very great importance of conservation. Our leading research workers have taken a very great part in the development of the science and practice of fisheries conservation through the International Council for the Exploration of the Sea, and in other ways. Things are looking up in this respect. The North-East Atlantic Fisheries Convention, which was signed in London last January, should prove a great safeguard of the fisheries in the years ahead, and we can take pride in the knowledge that Britain and her fishery scientists have had very much to do—a leading part, I would say—in bringing to birth this Convention.
I have tried to answer what I thought were the main points in the debate. On other matters of detail I will certainly try to write to hon. Members. In conclusion let me say this. I do not believe that hon. Members opposite need fear that we on this side of the House regard the future of the fishing industry with any complacency. I can honestly assure them that we do not.
§ Mr. Hare
It may be a platitude, but it happens to be true. Platitudes are not bad if they are the truth. All of us, even including my old friend the hon. Member for South Ayrshire, want to see 296 a prosperous fishing industry. By our provision of grants, loans and subsidies, we as a Government, with the support of the Opposition, are playing our part. We are, indeed, in partnership with the fishing industry. I wish to make it quite clear that we on this side are not shirking our responsibilities or letting that partnership down.
§ Mr. Hare
The hon. Member for South Ayrshire has made one speech already.
The Secretary of State and I try to maintain the closest possible continuous contact with the industry on the problems which are facing it today. I think I can fairly say that, although, naturally, they do not agree with all the details of the Government's policy, the leaders of the industry do appreciate that we are trying to do what we, at any rate, think is best for the industry. Both the hon. Member for Sunderland, North and the hon. Member for Orkney and Shetland (Mr. Grimond) laid great stress on the problems of the future. The hon. Member for Orkney and Shetland spoke about the shape and pattern of the markets, and the hon. Member for Sunderland, North touched on the very grave and complicated future problems which face the industry, on which we are awaiting the recommendations of the Fleck Committee.
I am sure the whole House will agree that we are very fortunate in having Sir Alexander Fleck and his colleagues committed to this great task. They are a very good team of practical men who are fully aware of the urgency and importance of the task they have undertaken. I have so far refused, rightly, I think, to hurry them in a task of such importance. To put undue pressure upon people and so try to prevent them from carrying out in full the inquiries and research which they believe they need to deal with the problems facing them, would not be a responsible action on our part.
§ Mr. Willey
I can appreciate the difficulties in the suggestion, but is there any opportunity of consultation between the Fleck Committee and the Government when the Government are taking steps which, as I have argued, affect the size and pattern of the industry?
§ Mr. Hare
I quite appreciate the point which the hon. Gentleman makes, and I am grateful to him for seeing the difficulties. There are difficulties, as he suggests, and it is not at all easy to find a solution until, in fact, we have the report. I am grateful to him for his understanding of the position.
We shall all have to consider the report very carefully to see what can be done to achieve a really competitive and prosperous industry in the future. For the moment, I hope that the House will agree that we are right to continue the white fish and herring subsidies broadly on the same basis for the next subsidy year.
I know that the House has nothing but admiration for the courage and tenacity of our fishermen—the hon. Member for Lowestoft said this in his opening remarks—in what must always be, despite all the modern improvements and advances, one of the most arduous callings there is. They deserve well of us all, and all hon. Members on both sides of the House have shown today that they have their interests at heart.
§ Mr. G. R. Howard
Will my right hon. Friend be good enough to give an assurance that he will look very carefully into the suggestion of Government assistance for lights which Trinity House says that it cannot provide for fishermen, which 298 is something of the greatest possible importance to them?
§ Question put and agreed to.
That the White Fish Subsidy (United Kingdom) Scheme, 1959, dated 24th June, 1959, a copy of which was laid before this House on 25th June, be approved.
§ Herring Subsidy (United Kingdom) Scheme, 1959, dated 25th June, 1959 [copy laid before the House, 25th June], approved.—[Lord John Hope.]
§ White Fish and Herring Subsidies (Aggregate Amount of Grants) Order, 1959, dated 24th June, 1959 [copy laid before the House, 25th June], approved.—[Mr. Hare.]
§ White Fish Industry (Grants for Fishing Vessels and Engines) (Amendment) Scheme, 1959, dated 24th June, 1959 [copy laid before the House, 25th June], approved.—[Mr. Hare.]
§ Herring Industry (Grants for Fishing Vessels and Engines) (Amendment) Scheme, 1959, dated 25th June, 1959 [copy laid before the House, 25th June], approved.—[Lord John Hope.]