§ 12.20 p.m.
§ The Joint Parliamentary Secretary to the Ministry of Agriculture, Fisheries and Food (Mr. James Hoy)
I beg to move,That the Fishing Vessels (Acquisition and Improvement) (Grants) Scheme 1967, dated 8th February 1967, a copy of which was laid before this House on 15th February, be approved.The House will recall that the White Paper on Investment Incentives, Cmnd. 2874, of 17th January, 1966, promised that grants for fishing vessels would be adjusted to take account of the abolition of investment allowances. On 9th March last year, my right hon. Friend announced what the adjustment would be: an increase of 10 per cent. in the rates of grant, from 25 per cent. to 35 per cent. for deep sea vessels over 80 feet in length and from 30 per cent. to 40 per cent. for inshore vessels under 80 feet in length.
In the fishery debate on 29th July last, I told the House that the new rates would apply also to improvements to vessels and that the existing ceilings on grants in individual cases would be removed. I also promised that the Scheme would be retrospective so that the new arrangements would apply to all eligible investment since 17th January, 1966.
The Scheme now before the House gives effect to these undertakings. It amends the existing schemes for white fish vessels, herring vessels and improvements, so that grants already paid can be brought up to the new rates. It then provides for the new rates to be paid on future applications.
We have taken the opportunity to bring white fish vessels, herring vessels and improvements all together into a single scheme for the sake of simplicity. Improvement grants will be available for herring vessels for the first time, and existing limitations on the types of improvements that may be assisted will no longer apply. Grants will be available for all improvements approved as worthwhile. Any expenditure incurred since 17th January, 1966, which was not approved for grant but would have been approved if this Scheme had been in operation will qualify for consideration.
There are three new features of the Scheme. One is that specific provision 462 is made for cases in which an applicant personally does the work on his own vessel. Second, a new provision has been included for improvements to the safety and seaworthiness of vessels. The third new feature relates to vessels built abroad. Such a vessel will qualify for the full rate of grant unless it appears to the Ministers that the cost compares unfairly with the cost of building in this country.
In such cases, they will attract a grant of 20 per cent. which is the rate for merchant ships. In the past, no grant has been given in such cases. But now that investment allowances have been replaced by 20 per cent. grants for merchant ships, the same should apply to fishing vessels. This is fair and reasonable from the point of view of owners and of British shipbuilders.
Finally, I should mention that the Scheme does not provide for the further increase of 5 per cent. which will be payable on expenditure incurred in 1967 and 1968. Legislation will be needed to enable us to increase the rates provided in this Scheme, which are at the statutory maximum. But we have thought it right not to hold up the Scheme on this account. We want the industry to have the money that is already due to it.
Hon. Members will have noted that the Scheme is to run until 31st December, 1972. This is the end of the 10-year transitional period for which the industry has been promised special assistance. What is to be done after that will depend on developments in the meantime.
Before I leave the Scheme, the House will expect me to say a word about the policy that underlies it. It has been our policy and that of our predecessors that the grants should result not in an increase in the catching power of the fleet but in the replacement of old vessels by new ones.
Since new vessels have greater catching power than old ones, we require two old vessels to be scrapped for each new freezer and the equivalent of one and a half for each new conventional trawler.
§ Mr. James Johnson (Kingston-upon-Hull, West)
Is the two for one sacrosanct? I understand that the White Fish Authority—perhaps my hon. Friend may care to comment on this—considers that it should depend on merit, ship for ship, so to speak.
§ Mr. Hoy
I thought that that would be my hon. Friend's question. If he will wait a moment or two, I shall come to it.
I have stated what our policy is, and there is at present some justification for it. We must have regard to the stocks of fish available and the prospective demand; and we want a balanced age structure in the fleet, which, also, is important. Experience has shown the dangers of overbuilding a fleet that is not yet viable. On the other hand, we recognise the contribution the industry has to make to our balance of payments.
The Estimates Committee has asked us to consider the possibility of abolishing the scrapping ratios, and this is being done, I am happy to tell my hon. Friend, in the course of the current review of policy.
The House will be interested to know the results of the fishing industry for 1966, which have just come to hand. Total landings increased from the 1965 level by 25,000 tons to 935,000 tons, the highest figure since 1956. The value increased by £800,000 to £61.8 million, an all-time record. Imports of fish comparable with our own landings declined by 10,000 tons, worth about £500,000. The industry is to be congratulated on these results.
The earnings of the distant water fleet failed to keep pace with rising costs, and this is a matter for concern. We have not yet got all the information to enable us to assess the reasons for this situation. But we shall be looking further into it in the course of the annual subsidy review which is about to start.
With this explanation, I commend the Scheme to the House. It provides a fair measure of assistance to enable the industry to carry on with the process of modernisation that is needed to increase its efficiency and enable it to make its full contribution to the national economy.
§ 12.29 p.m.
§ Mr. Patrick Wall (Haltemprice)
As sugar beet had, apparently, to take precedence over this debate this morning, it looks as though fish will again run late. It is likely to run late next week, and I hope that we shall not have to have our debate in the nocturnal hours which are usual for the fishing industry in the House.
I thank the Minister for his explanation of the Scheme. We on this side welcome 464 it. We are delighted to have it even though it has been a long time in gestation. As the hon. Gentleman explained, the scheme springs from Cmnd. 2874 of January, 1966—
§ It being half-past Twelve o'clock, the debate stood adjourned.
§ Debate to be resumed Tomorrow.