§ The Parliamentary Secretary to the Ministry of Agriculture, Fisheries and Food (Mr. Jerry Wiggin)
I beg to move,That this House takes note of European Community Document No. 5704/81 amending Directive 71/118 concerning hygiene in poultry slaughterhouses and supports Her Majesty's Government's objective of removing inequalities between Member States in the implementation of that Directive.
The Government welcome the Scrutiny Committee's decision to recommend this document for debate. The subject is of importance to the poultry industry and the consumer and it raises serious questions about the implementation of Community directives throughout the Community.
It may be helpful if I recall first that directive 71/118, which was of course agreed before the United Kingdom's access to the Community, is unlike other meat hygiene directives in that it applies to domestic trade within member States as well as to intra-Community trade. The directive lays down a number of requirements designed to ensure the hygienic production of poultrymeat, including structural standards for slaughterhouses and hygienic practices. However, the main provision which concerns us tonight is the requirement that each poultry carcase which is produced in a licensed slaughterhouse should be inspected under the overall responsibility and supervision of an official veterinary sugeon. The purpose of this provision was to provide a consumer safeguard for poultry-meat similar to that which had previously been available and still exists for red meat, and the terms of the directive make it clear that the intention is not only to reduce the risk of possible food poisoning but also to protect the consumer from other conditions in the meat, such as pus or tumours, which, while not necessarily making the meat unsafe, would nevertheless make it unwholesome.
The implementation of this inspection requirement, which became compulsory in August 1979, required in most member States the introduction of a virtually new poultrymeat inspection service, since previously in most countries there had been very little systematic inspection of poultrymeat. In this country, as hon. Members will know, we have made substantial progress in setting up the inspection service largely as a result of a major co-operative effort involving the Ministry, the British Poultry Federation, the local authority associations and the British Veterinary Association, to all of which I am glad to pay tribute for this achievement. It is fair to say that there were doubts both on the industry and the local authority sides, but nearly all local authorities have now gone a long way to establishing the service required by the directive on the basis of guidelines issued by the Ministry after detailed discussion. These cover both the numbers of poultrymeat inspectors required and the extent of veterinary attendance in poultry establishments.
However, as early as 1979 evidence began to emerge that some other member States were applying the directive in a way which is more favourable to their industries, either through lower levels of inspection or subsidies towards the cost, or both. At our insistence, the Commission undertook to make a study of the implementation of the directive in the various member 120 States. In spite of frequent reminders by my right hon. Friend the Minister of Agriculture, Fisheries and Food, the Commission report took a long time to appear, but when it did it confirmed that there were serious distortions both in inspection levels and in charging practices which, in the Commission's view, were sufficiently serious to require further harmonisation measures. After some further delays, the Commission produced in April this year the proposals contained in the document before us tonight.
Before dealing with these proposals in detail, I wish to express my sympathy for the position in which the industry now finds itself as a result of these distortions in the implementation of the directive. It is not the main factor that has contributed to the present difficult trading conditions, but it is one element. The Government have recognised the need to help by making available £2 million towards the costs of poultrymeat inspection in 1980–81, and we shall continue to try to achieve uniform application of the directive in Brussels. We have already given an assurance that we shall adjust arrangements here to whatever turn out to be the agreed levels in the Community; and I repeat that assurance now. We are also determined to ensure that whatever is agreed is realistic and that it is genuinely applied in all member States. We shall be seeking agreement that for this purpose the Commission should make regular visits to each member State to check on the measures which are being applied.
I shall comment briefly on the four main proposals in the Commission document.
§ Mr. Tony Marlow (Northampton, North)
Is my hon. Friend suggesting that at that stage we shall have the bureaucrats of the Commission creeping round our slaughterhouses seeing what we are doing?
§ Mr. Wiggin
I thought that I had made it abundantly clear that we sought the assurance of the Commission that in implementing such regulations it should see that such regulations are being carried out in all member States.
I was commenting on the four main proposals in the Commission document—veterinary attendance in poultry slaughterhouses, inspection rates expressed in numbers of carcases per inspector per hour, charging arrangements and the extension of the derogation allowing the production of uneviscerated poultry in licensed slaughterhouses. First, I appreciate that the Commission's proposal for full-time veterinary attendance in all but the very smallest of slaughterhouses is one to which the industry and the local authority associations are particularly opposed. I understand the view that that is excessive. We consider that a sliding scale of attendance included in our existing guidance to local authorities under which full-time attendance is recommended in only the largest slaughterhouses—and the average is more like 50 per cent. Attendance—is about right. We shall, therefore, be resisting the Commission's proposal on that.
Second, the Commission has proposed that the maximum number of broilers which can be inspected per hour by each inspector should be 1,200, while for hens, turkeys, geese and ducks it has proposed 600. In other words, the Commission is saying that it takes three seconds to carry out an adequate inspection of a broiler and correspondingly longer for larger or older birds. Here again, I appreciate that the industry and the local authority associations believe that one inspector can inspect more carcases in one hour than the Commission suggests. I 121 apologise for having gone into such detail, but I know that a number of hon. Members are concerned about those details. My technical advice is that three seconds per broiler is about right, given the need to inspect both the outside, inside and visceral mass of each carcase and that the figures for the other species are about right also, except that for ducks, where rather faster rates of inspection are possible.
In discussing this subject in Brussels, we shall be especially mindful of the need for regular Commission supervision of whatever turns out to be the agreed level of inspection and we shall not give our agreement to any figures unless we are satisfied that they will be adequately policed. One idea which has already been advanced in Brussels and which in our view merits further examination is that such inspection levels might be obligatory only for poultrymeat which is eligible for intra-Community trade. However, there is also considerable opposition to this idea among some member States and it is too early to say how the discussion might develop.
Third, on charging, the Commission proposal is that there should be no subsidy from public funds and that the full cost of inspection should be charged to the product at a standard rate. We are in agreement with the part of the proposal which rules out subsidies. Successive Governments in this country have, rightly in my view, considered that the costs of meat inspection, whether for red meat or poultry meat, are part of the costs of production and should therefore be charged to the product. Some other Governments in the Community have not taken that view up to now. We have, however, some doubts about the Commission proposal for a standard rate charge. The Commission have explained that it intends that charges within countries should be at a standard rate, but that there need not be a standardisation between countries. We do not see much point in this aspect of the proposal, bearing in mind the practical problems of calculating and collecting a standard charge.
The fourth Commission proposal is for a five-year extension of the derogation permitting the production of uneviscerated poultry in licensed slaughterhouses. At present, that is due to end on 15 August this year and the Commission proposal would extend the date to 15 August 1986. The proposal is of greater relevance to some other member States than it is to the United Kingdom, but it is of importance to those licensed slaughterhouses in this country which still produce New York dressed poultry. As it is clear that no decision on a five-year extension can be taken by 15 August this year, the Commission has now proposed a one-year extension pending a definitive decision later. The Council of Ministers in Brussels is due to discuss this proposal tomorrow. The Government have alerted all the local authorities concerned to the situation and, whether the Council takes a decision on this matter this week or after the summer, we think that all local authorities are now aware of the need not to take action which might place processors of New York dressed poultry in this country at a disadvantage compared with their equivalents in other member States.
I hope that it will be helpful to the House to have heard in some detail how we plan to tackle the main Commission proposals. It is already clear from discussions at official level in the Council working party that there are wide differences of opinion on most of these issues among the 122 various delegations. Early decisions are, therefore, unlikely, although we shall continue during our Presidency to press for agreement.
The Government are very well aware that time is short domestically, particularly as the cost equalisation scheme run by the British Poultry Federation is due to end on 31 August this year. We have, therefore, been considering urgently with the federation, the local authority associations and other interested organisations whether, in advance of Community decisions, some means can he found of enabling the poultry, meat inspection service to be provided, within the context of the existing regulations, at a lower cost to the industry while maintaining the essential safeguards which the service provides to consumers of poultry meat. These discussions have not yet been completed and I am not in a position to say more today, but I hope that it will be possible to make an announcement on this subject in the near future.
§ Mr. Gavin Strang (Edinburgh, East)
Hon. Members who have followed these matters will recall the tortuous arguments that preceded the implementation of the present arrangements for the inspection of poultrymeat. The Parliamentary Secretary participated in the debates. The present arrangements for the implementation of the provisions led to an improvement in standards of hygiene in the processing of poultrymeat. All the interested parties, the veterinary surgeons, environmental health officers, poultrymeat inspectors, producers and processing companies played their part in achieving a real improvement in standards. The main improvement came from new investment in more modern and hygienic equipment on the introduction of the regulations.
We must also acknowledge the real tensions that exist, not least between the official veterinary surgeons and the environmental health officers, over the allocation of responsibility for the administration and supervision of poultry processing plants.
Some advance has been made in hygiene standards. We must not forget that that is what the regulations are about. However, some significant problems have arisen as a consequence of the application of the directive throughout the member States. Above all, the problems arise out of the unevenness of its application. According to the official survey, we have been applying the directive more rigorously and effectively than have other member States, with the possible exception of Denmark, and to some extent Germany. Many member States, including our main competitors, have not come anywhere near the standards laid down by the British Government.
There has been a severe disparity in relation to the cost of the inspection service. The Government made a contribution towards the training, and a limited contribution towards the cost of running the service, but in practice the British producer has borne a heavy burden compared with his competitors. The Danish Government for example, have covered the cost of the service. Clearly, we cannot expect our industry to accept that state of affairs, particularly in present circumstances.
There is a dichotomy in the approaches to the problem. I note that the Parliamentary Secretary is not committed to the Commission's amending directive. Indeed, I take it from his remarks that the Government are determined to achieve changes, if not to eliminate the directive—and we may be better off without it. The Commission's approach 123 is to introduce an element of greater stringency and uniformity across the board, but the Government seem to be saying that there should be increased flexibility and a loosening of requirements in the United Kingdom in relation to the inspection service.
Will the Parliamentary Secretary say more about the proposition that it is widely believed the Government favour, namely, that there should be a change in the uniform requirement, which many welcomed when it was first introduced, that if a poultry processing plant was deemed appropriate for the export trade, it was deemed appropriate for the home trade as well, and vice versa?
There may be some difficulty in moving from the present position, particularly if some major retailers, say Marks and Spencer, were to decide that they wanted to retain the standard applied for the export trade. Our approach should not necessarily be to create a two-tier system in the United Kingdom. Above all, we have to acknowledge that the present situation is unsatisfactory and we cannot expect our industry to labour under the present conditions.
The reason why this has become such a major issue is not so much the disparity in the cost of the service, though that is a significant element in competitiveness, as the overall state of the poultry industry. We cannot discuss the Commission's proposal in isolation from the decimation of the British industry. I hope that the Minister can give us some facts about the decline that is taking place. Is it true that 5,000 of the 25,000 jobs of those directly employed in the industry have already been lost? We know of the major closures, and many other plants are running at a loss and only just surviving. They want some changes in the inspection service, and they want the Government to meet the total cost of the service, at least temporarily, but the gut issue is the unrealistic competition that our industry has to put up with.
This sector, more than any other, brings out the extent to which we are getting the worst of all worlds from the CAP. On the one hand, we bear a disproportionate share of the cost of the CAP across the board, but on the other the French Government are pouring money into their industry and deliberately setting about establishing a large market share in the United Kingdom. No one can dispute that. The facts have been exposed by the British Poultry Federation, the NFU and others.
It is not possible to have a debate on the narrow lines that the Minister has set without considering the crisis that exists in the poultry industry. Our approach to the directive should be: what can we do urgently in the short-term to shore up our industry? That sounds rather negative and defensive, but it is a reflection of the depth of the crisis. First, we must help with inspection costs. I do not disagree with the hon. Gentleman's observation that, as a principle, Government would be reluctant to bear the total cost of the inspection of red and white meat. I should not make an issue of that.
In the present climate, we should not debate such principles, but should look at the matter from a pragmatic point of view. The industry is in a state of crisis, and assisting with inspection costs is one immediate way in which we can help the industry. Rather than spending a lot of time arguing about modest changes to this amending directive—there is much cynicism and scepticism anyway about whether it will be applied in the other member 124 States—it would be better if Ministers came forward with a scheme, before Parliament goes into recess, to provide Government money to lift the cost of this service from our producers.
Secondly, Ministers should bring forward a scheme to provide production aids for our industry. There is no alternative to that in the short term. The Government should tell the French and the Commission that they are not prepared to abdicate responsibility for this important industry—and in my view it is an important industry.
§ Mr. Hugh Dykes (Harrow, East)
We are, of course, in sympathy with what the hon. Gentleman is saying about the need to defend the industry. However, perhaps he is getting the French situation out of perspective, because I know that he is always anxious to attack wicked foreigners if he can. Is it not, rather, that the French are benefiting in the under-developed regions, such as Brittany, from the kind of regional grants system that we have here? There are certain similarities. If the relevant poultry industry were located here in under-developed regions, as opposed, say, to East Anglia and elsewhere, they could benefit from subsidies of the kind that the French are receiving.
§ Mr. Strang
I am surprised that the hon. Member should accuse me of attacking wicked foreigners. Most people who have followed what I have said in these debates over the years would not make that charge against me. One cannot dismiss the matter by saying that the French are locating these plants in areas where regional funds are payable and that it can simply be accounted for in that way. When one examines the scale of the support, which is selective and sectoral—it is in Brittany, but it is not applied across the board to all industry—and when one examines the volume of the concessions and the amount of public money that is being spent in various forms, one sees that it constitutes wholly unacceptable competition.
We should treat our industry in the way that the French would treat their industry if it were in a similar position to ours and make it clear that either they remove the unfair aids, or we limit their access to the British market.
§ Sir Paul Bryan (Howden)
Would the hon. Gentleman be right in saying that a single plant which has been put up in Brittany, and which has been heavily subsidised, will have the capacity to produce as many turkeys as the whole British turkey industry?
§ Mr. Strang
The hon. Member is right. It is certainly of that order of magnitude. That is the example that has been most frequently cited in the agricultural press. This is a question not just of regional policy but of a sustained policy by the French Government, aimed at supporting and encouraging a massive expansion of the industry, which has already taken place, and which will take place to an even greater extent.
The history of the Community is such that we can forget about the Treaty of Rome and about free competition. When it comes to vital national interests, in practice member Governments seek to protect them. We are talking about a vital national interest here, and the Government do no one a favour by refusing to take action.
We can argue as much as we like about the narrow technical details of the inspection service implicit in the directive, but all the pressure being devoted to this matter stems basically from that unacceptable attitude. I hope that the Minister will address himself to these major issues of concern to the industry.
§ Mr. Peter Mills (Devon, West)
It is not often that I agree with the hon. Member for Edinburgh, East (Mr. Strang), but I agree with one of his comments about the directive. We have to look behind the directive and try to see what is happening in the industry. It is no exaggeration to say that a crisis has developed, not only in the poultrymeat section but in eggs as well.
There has been a real loss of confidence. Of course, the industry has had its problems before. It is an industry which has received the least amount of subsidy for many years; but it cannot weather the present storm, and it has lost confidence.
A great many people have been in touch with me about the problems—probably more than ever before. In my part of the world, in Devon and Cornwall, I have had the chairman of the local branch of the National Farmers Union and various constituents lobbying me. They have shown me their accounts and explained their problems. I find it very difficult to advise them.
The reasons may seem clear to some, but I do not believe that we can blame the Government. As has happened in many other industries, costs have risen, and these health regulations are a burden which add to the costs. There have been diminishing returns to the industry. Production levels are falling. Above all, there are genuine and real fears.
We see the expansion of French production. I do not know whether the House fully appreciates the determination of the French Government to be the food producers of Europe. In my view, it is the wrong way round. We ought to have that determination to be the food producers of Europe and to thrust into Europe with our exports and counter this threat. The industry has this real fear of French production.
There are low-price imports of both eggs and chickens, and, of course, there is more to come, as my hon. Friend the Member for Howden (Sir P. Bryan) implied in his remark about Brittany.
These fears, plus the costs and all the other factors to which I have referred, mean that the industry's confidence has gone. The producers feel a strong sense of unfairness. It is very difficult to prove this unfairness, however, especially about French production and their methods. The belief is that French producers are heavily subsidised. We know that there are national aids, and the industry believes that the French get away with it. We stick by the rules, and they do not. It is very difficult to pin down the French and for the Community to take action on this unfairness.
All this adds to the problems of the producer, but others are worried. There are many jobs at stake. If we lose our poultrymeat industry, thousands of jobs will disappear. The animal feed trade and our meat plants and slaughter plants which specialise in poultrymeat production will be affected. Many others besides the producers are fearful of the future and have lost confidence. This is a serious time with serious problems. In the long run the consumer will suffer. It will be a sad day if the consumer has to rely on imports of French or any other Continental poultrymeat for his table. The industry needs to have its confidence restored.
What can be done? It is difficult to know exactly what action can be taken. The hon. Member for Edinburgh, East has made one or two suggestions the implementation of which would be fairly costly. However something will 126 have to be done. The trade is saying to me "All right, Peter Mills, you have made all these excuses about what the Government are trying to do. You have told us about how they have taken the issue to Brussels and all the rest of it. But does the Ministry want a turkey and poultry industry in future?" I know that it does. That being so, action has to be taken fairly quickly. A point of no return is rapidly developing. It would be a tragedy to let the industry wilt away. We have an assurance—
§ Mr. Deputy Speaker: (Mr. Bryant Godman Irvine)
Order. I draw the attention of the hon. Member for Devon. West (Mr. Mills) to the fact that we are debating the subject of poultry hygiene and inspection.
§ Mr. Mills
That is exactly what I am doing, Mr. Deputy Speaker. The directive represents one more burden and one more difficulty for the industry to face. It is another measure that will add to the loss of confidence. It is plain that this measure will add to the industry's burdens. This is a crisis. The Minister has, I am sure, taken into account the effect of the directive. He has said that he appreciates the problems of the industry and has confirmed his determination to ensure that it is not destroyed by unfair competition from abroad.
§ Mr. Deputy Speaker
The hon. Gentleman may have a good argument to develop on another occasion. He must now confine himself to inspection.
§ Mr. Deputy Speaker
Order. That is the problem that we are debating. We are not debating other problems.
§ Mr. Geoffrey Johnson Smith (East Grinstead)
Is my hon. Friend saying that the burdens that the industry already has placed upon it put it in serious jeopardy and that the directive before us will push it over the brink and put the United Kingdom out of the industry altogether?
§ Mr. Mills
My hon. Friend is right. That is what I am trying to say. He has put the argument in a different way and in a different form. He is not Peter Mills and he speaks in another way.
I turn to the regulations. The latest proposals from the Commission will do nothing to restore the confidence that the industry requires. I reject the document. I hope that the Minister will deal with it savagely in Brussels. It is not what is needed. It is not what is wanted for the industry with one exception—namely, the proposal to allow New York dressed birds to continue. I have lived in Devon all my life. I have eaten New York dressed birds virtually all my life. I have never suffered anything from a bird dressed in that form. An extension of that derogation is very important.
The British Poultry Federation Limited states, first,That domestic product can in future be inspected according to national traditions, provided all the objectives and standards are met.Secondly, it statesThat export product must be processed to standards agreed at Community level, and rigidly enforced. We believe that the only effective sanction is to ban product which has not followed the agreed criteria.127 I tend to agree with that.
The NFU is not happy about it. It does not like the two-tier system. I wonder why. We have a two-tier system in various animal slaughtering—beef, lamb and so on. We have export standards and we have home standards. I do not know why, to help the industry in its present troubles and difficulties, the Minister should not bring in the two-tier system. I recommend it. I believe that in the present situation it would be the best way forward.
I apologise if I have been difficult, Mr. Deputy Speaker, but I hope you see that there is much more behind the proposals that we are discussing tonight than is immediately apparant. There is a serious loss of confidence. I believe that the Minister wants the turkey and poultry industry to continue. All I would say to him now—as I have said to him personally—is that, if he wants it to continue, we have to do something about it quickly.
§ Mr. Bill Walker (Perth and East Perthshire)
I welcome the opportunity to speak in the debate because of my constituency interest. I have a poultry processing plant at Coupar Angus. It is a substantial employer in an area that has already been adversely affected by the closures of a canning factory and three textile mills. One does not have to be terribly clever to realise that some of the closures have been brought about by the changing pattern of European trade, and there is deep concern in my constituency about the way things are going.
The directive that we are debating is of great concern to my constituents, because they see the way that British membership of the EEC has affected others around them. They note that we have suffered because of the way in which directives are applied by other member States, to the extent that it has adversely affected the people working in the two industries that I mentioned.
The British poultry industry is one which has been affected not only by the recession but by the distortions at the inspection level and in the charging practices operated by other member States. Consequently, we face subsidised imports from abroad, and this is damaging to our poultry processors.
From the comments made by the Minister earlier this evening, I trust that the original EEC hygiene directive is now up for amendment. I hope that he will confirm that that is what he was saying.
The poultry industry was right to draw hon. Members' attention to the situation that it saw. Uneconomic hygienic costs is only one adverse factor, but that is what we are debating this evening. My hon. Friend the Member for Devon, West (Mr. Mills) was rightly brought to order because he was widening the debate, but the industry is terribly worried, because this additional cost burden could be the difference between survival and going out of business.
It is time that we looked after this British industry and acknowledged that the French have not been behaving correctly. They have not been applying the existing EEC directive. Can we genuinely believe that, whatever amendments are agreed, the French will apply them? They have already invested heavily in plants and will wish to see them prosper, and they can do so only if they substantially penetrate the British market.
128 I do not often agree with the Opposition Front Bench, and I rarely agree with the hon. Member for Edinburgh, East (Mr. Strang), but much of what he said this evening I would have wished to have said myself. He confirmed the views expressed to me by the management, trade unions and others in the poultry processing plant in my constituency.
In these difficult times, Government aid to help with the cost of inspections and other burdens would be welcome, but the industry wants fair competition, particularly in our own and EEC markets. More importantly, it needs a stable home market. We look to the Government to ensure that our industry continues to have that.
§ Mr. Austin Mitchell (Grimsby)
It is interesting to listen to Conservative Members. They are essentially saying that, if we enforce the regulations, they will prove to be unnecessary, as the industry will have gone bankrupt because they have been enforced. It is the usual spectacle of the party of Euro-enthusiasts praising the Common Market generally, although on every specific issue they lament its disastrous effects on industries and other activities in their constituencies. They praise the general and attack the particular. These regulations are not only pointless and unnecessary; they are an inevitable consequence of our membership of the Market that we agreed to enter in 1972.
Grimsby may not be recognised as a centre for the Chicken-Licken Turkey-Lurkey and Ducky-Kucky industry, but I, too, have received representations, particularly from Cherry Valley Farms, which employs an unfortunately reduced number of my constituents. It feels that the provision for veterinary inspection place an unnecessary burden on the industry.
Most hon. Members will have received similar representations from the British Poultry Federation Ltd., which states thatthe whole of the British poultry industry … asks you to reject the proposals in the latest Commission document root and branch with the exception of the derogation proposed for New York Dressed Production. We see this document as totally disastrous, and irrelevant to our requirements.That puts this document in its proper light. We face a proposal that has already increased costs. Estimates of the increase vary, but for efficient producers it must be about 1½p per bird and for less efficient producers up to 20p.
In agreeing to assist phasing in the system to the extent of £2 million in 1980–81, the Government acknowledge that the burden of costs on the industry is considerable. Those costs, are being imposed on an industry that is in an extremely difficult competitive situation, largely due, as hon. Gentlemen point out, to unfair competition from the market that they adore.
Although standards have been improved, it has been largely the result of better equipment, much of it imported. The cost burden of the new inspection system is too heavy for an industry in a difficult situation. It is, therefore, appropriate that the burden should be borne, not as the directive says, but by the Government, as happens in Denmark and in other competitor countries. Our policy has been to push our standards ahead of those in other European countries and then to argue that we should resile from them or let others catch up. That policy has placed our industry in an exposed position.
Here, as all too often, we find ourselves obeying the full strictness and interpretation of the law and establishing 129 practices ahead of other Common Market countries. We treat matters seriously, and so incur costs and other disadvantages which impose a burden on our industries. As a result, their industries steal our markets, partly because they are less scrupulous in the observance of the rules than we are. It is a classic Common Market story which is now affecting this industry.
All this points not to this directive—our previous provisions were, after all, satisfactory—but to applying the veterinary inspection system only to the export trade and taking powers to control imports to see whether proper inspections have been applied to imported chickens, turkeys and ducklings.
This is a directive, not a regulation, so it is enforced more subjectively. By that very fact, it will encourage the very divergence of practice that we are anxious to avoid. Unfortunately, in pursuing uniform standards, the Government are pursuing a mirage and at the same time damaging our own industry.
§ Mr. Nigel Spearing (Newham, South)
My hon. Friend mentioned that this was a directive, not a regulation. If the Minister does not achieve what his hon. Friends seeks, surely it will be possible not to implement the directive by not approving the orders that he may have to lay before the House. They would then be doing what many of us believe that the House will eventually have to do, which is to stand up against the Commission operating an unfair system.
§ Mr. Mitchell
My hon. Friend is right. I hope that in the last analysis they will stand up and be counted, instead of mouthing vague protests and then doing nothing about it.
In my view, we should withdraw the guidelines for the domestic industry, apply the regulations only for exports and ensure that they are enforced for imported produce. It is unreasonable to impose mechanical standards designed by Euro-bureaucrats, as the Minister suggested, timing turkeys and chickens as they pass through.
This brings us, as it were, to the parson's nose of Euro-folly. Perhaps the Minister will tell us, incidentally, what we are supposed to make of the passage in the amended directive 71/118, which reads:Whereas a procedure ensuring close co-operation between the Member States and the Commission should be set up for taking decisions relating in particular to the changes of the maximum number of birds which may be inspected in one hour by one veterinarian or by one assistant.To me, that is a Euro-gobbledegook passage in a largely Euro-gobbledegook directive.
The industry is in an extremely difficult competitive situation. It is faced with unfair and uncontrolled competition, largely from France. The Government should heed the voice of the industry and speak with that voice to the Common Market, instead of speaking, as they have hitherto, with one voice to the industry and another to Europe. They should speak for the industry and try to help it in this difficult situation, rather than sit on the fence as they have done so far.
§ 11.3 pm
§ Mr. Charles Morrison (Devizes)
As you have rightly and properly reminded us, Mr. Deputy Speaker, we are discussing health problems affecting trade in fresh poultry meat. Indirectly, therefore, we are talking about the future of the United Kingdom poultry industry. The two matters 130 are indivisible because of the costs involved. Indeed, the National Farmers Union has estimated that there are 100,000 jobs in this industry, if one includes the production, packing and processing of poultry. The amending regulations before us tonight are therefore of considerable importance not only to poultry production but also to employment in this country.
As my hon. Friend the Member for Devon, West (Mr. Mills) has reminded the House, the poultry industry is suffering a severe loss of confidence. Like my hon. Friend, I have been inundated with representations and letters from my constituency expressing fears for the future of the industry because of what is thought to be unfair competition from other member States of the Community. There is no question at the moment of any expansion in the industry. Indeed, all the statistics show that it is contracting sharply and that a number of poultry producers and processors are in considerable difficulty.
I am a strong supporter of our continuing membership of the European Community—
§ Mr. Morrison
—and I consider that any other possibility is beyond belief and totally impractical. Furthermore, I am a strong supporter of sensible poultry hygiene regulations—
§ Mr. Morrison
The hon. Gentleman is a fraction ahead of me. Harmonisation must be real harmonisation on a totally equal basis throughout the Community. The hon. Gentleman, who has been interrupting me, implies that he has been rather clever. The truth is that this brief debate takes place because, as the explanatory memorandum states,A study of the practical application of this Directive undertaken by the Commission during 1979–80 revealed differences both in levels of inspection and methods of charging in Member States sufficiently great to necessitate further harmonisation.It is therefore clear that the Commission itself appreciates that there has not been harmonisation and that there should be harmonisation in the future.
I thought that the Minister's speech was encouraging. It voiced some, if not all, of the reservations about the proposals that I happen to feel. I was also encouraged to hear my hon. Friend say that early decisions are unlikely. That is excellent. It means that the Government are determined to ensure that before the revised regulations come into force there should be proper arrangements to ensure that this time there will be harmonisation. In that regard, I take the view that it is important to ensure that there should be adequate policing of the arrangements in all the member States of the Community.
I have been in correspondence with the Minister about unfair competition. I have been encouraged by his response. My hon. Friend tells me that he has sent the Commission a substantial dossier of the aids that he understands are available in particular to French poultry producers with a request that the Commission should determine whether such aids are compatible with Community rules on State aids. I should, therefore, like to encourage the Government in their efforts to chivvy the 131 Commission to take steps to secure the control of the abuse of regulations or competition by any Community country. I rely on the Government's determination to agree only to poultrymeat hygiene amending regulations that will insist on equality of treatment, in the widest sense, throughout the Community.
§ 11.9 pm
§ Mr. Eldon Griffiths (Bury St. Edmunds)
I am sure that the Minister has got the point that hon. Members are virtually unanimous in asking him to take the directive back and to wring its neck. That is the best thing to do.
My constituency, like that of my hon. Friend the Member for Sudbury and Woodbridge (Mr. Stainton), is full of chickens, ducks, geese and turkeys. Long may it remain so! However, I have grave doubts about whether that population of feathered creatures will remain so strong if anybody—the EEC, the Government, or urban people, who constantly add to our costs—continues to add to the industry's burdens. The Minister was right to start by underlining the fact that directive 71/118 is the only Community directive that seeks to regulate domestic as well as infra-European trade. That is why it is particularly important to have a detailed debate.
I have only four points to make on the Minister's speech. As regards the attendance of vets, the EEC has never understood the virtue of the old English system of public health inspectors, who are now known as environmental health inspectors. It was wrong of the vets unions to join together to squeeze the public health inspectors out of the inspection business. They did a good job and should have been allowed to continue to do so. They were cheaper, much more practical and knew their business. The suggestion that there should be one vet in every egg-packing or chicken-processing plant in the country is absurd.
I agree with my hon. Friend the Minister that our sliding scale is better, but I should be inclined to go even further and suggest that it is sufficient for public health inspectors or environmental health inspectors to form their own judgments. They live in the country and know what they are doing. They know when it is necessary to attend, without needing regulations from Brussels or anywhere else.
I turn to the subject of the inspection of carcases per hour. It is absurd that we and the other Parliaments of the Community should debate whether three or four seconds per bird is needed. Is it to be three seconds if it is a broiler, four seconds for a duck and five should the bird happen to be a goose? That is preposterous. Anyone who has seen a poultry production line will know that even the most highly paid vet in the world will become cross-eyed if he tries to look at every bird going by. There is not a man alive who will spend three seconds on every broiler and four seconds on every duck. That does not happen and it would be absurd to write such detail into any form of international law.
The Minister mentioned the charging rates. The local authorities and industry in my part of the country are at one in believing the charges to be far too high. If we had had a more sensible system, with environmental health inspectors making their own judgments on random 132 samplings, the charges could have remained lower. It must be borne in mind that environmental health inspectors have to bear the responsibility if they do not do the job properly.
On the question of the five-year derogation of New York dressed poultry, like my hon. Friend the Member for Devon, West (Mr. Mills), I was brought up on un-eviscerated birds. I have never understood why they were called New York dressed. I hope that I can continue to eat them, because I am old-fashioned enough to think that the flavour is better. Whether it is, where there is a decent system of local public health inspectors, they know what it is necessary to inspect.
All of this extra complication brings the Common Market into disrepute. I am a supporter of British membership. I hope that the Minister will be strengthened by the debate to return to his colleagues in the European Community. He should tell them that if there is one way of putting at risk the loyalty to the European Community that the vast majority of Conservatives have, it is to introduce directives such as this, which are irrelevant to the countryside and do no good for the hygiene standards that they seek to promote.
§ Mr. Colin Shepherd (Hereford)
One of the things that I find when looking round my constituency and examining the businesses of my major employers is that the more I examine them the more interested I become in what they are doing. I have a major producer of poultrymeat in my constituency, Sun Valley. It fills me with pleasure to see so many colleagues here this evening from constituencies in which Sun Valley has subsidiary plants. That is indicative of the interest that is taken on a wider front in the affairs of Sun Valley and the poultry industry generally by Conservative Members, even if not by the Opposition.
One is inclined to think of poultry producers' premises as being small sheds or houses. Nothing could be further from the truth. Today the poultry industry is a large, vertically integrated industry which involves not just the growing of birds but their processing,, the growing of feed for the birds and the further value added to birds by selling cooked meats, prepared dishes, Tandoori this, fried chicken that and so on. That is a major fact for hon. Members to bear in mind when considering the structure of the poultry industry.
We are considering suggested amendments to the poultrymeat hygiene regulations, which have given rise to an immense amount of stress to the industry since they were introduced in 1979. We are also considering the draft proposals for the improvement of those inspection regulations.
The proposals do not fill me with much confidence. Basically they are not a happy set of draft proposals, with one exception. That is the proposal mentioned by my hon. Friend the Member for Devon, West (Mr. Mills), backed up by my hon. Friend the Member for Bury St. Edmunds (Mr. Griffiths) about New York dressed poultry. I can see no reason for not having derogation in perpetuity for NYD. Let us not mess about with a further five years here or one year there. Let us take that out of the ball park and get on with the mass-produced business, not the New York dressed which is small-scale, farm gate sales stuff.
We are not happy with the present regulations. We see differences arising about enforcement. That was adequately drawn—or dragged—out of the Commission by the survey that was carried out and published many 133 months later after much procrastination. There is no such thing as parity of enforcement of the regulations within the Community.
We have seen no parity either in the costs of the regulations. Denmark carries the entire cost of poultrymeat inspection. We have been forced into having to bail out the industry by the welcome addition of £2 million on a fifty-fifty basis with the industry. That is much appreciated. The French run two systems. They have the effilé system for internal use, which means that the full costs of inspection are not borne by the broiler fowl industry. The extra margin from that can go towards assisting the export business or the development of new business. These are important factors.
Problems are also experienced in the United Kingdom by the operation of the British Poultry Federation's equalisation scheme. It has given rise to stresses in the industry, although broadly it was welcomed as a fine initiative by an industry under great stress.
We must examine a two-tier structure. As an interim measure we must get away from what we have on the table in front of us. We must lean towards an interim measure until the question can be resolved properly in the light of experience and the development of markets. I stress the importance of having an interim measure.
Veterinary inspection is more onerous. If we are happy about the present enforcement, why should the next provision be more rigorous? Why should we be confident that veterinary inspection will be enforced in the French and Dutch plants when we have no reason to believe that it is enforced at present? I am open to being shot down on that. I should welcome it, but I do not think that it is possible.
There is a massive disagreement between the Commission and the industry about possible inspection rates. The issue was put in its proper perspective by my hon. Friend the Member for Bury St. Edmunds (Mr. Griffiths), who poured derision on cross-eyed inspectors trying hard to keep pace with the fast flowing line of birds. I have watched them and it is as hypnotic as watching cider being bottled down the road from Sun Valley.
We like the thought that no Government subsidies will be given towards the cost of inspection. We like the concept of the full cost of inspection being charged to the product at a standard rate. However, we do not know how monitoring is to take place. How do we know that it will happen? It is important that confidence is instilled. My hon. Friend the Member for Devon, West referred to that.
The British Poultry Federation's equalisation scheme is due to finish at the end of August. That threatens to drive a wedge through the poultry industry. We should recognise that that is inherent in the present position. The equalisation scheme was designed to spread the cost of inspection across the industry. It helped the small producer. However, it produced a major strain on the larger producer.
If the equalisation scheme were removed and we returned to the position before its introduction, the bigger producers such as Sun Valley would be able to charge about 5p per lb. less on their poultry meat. At the end of the inspection system it will cost only ½p. With that 5p per lb. premium such companies would be in a position to expert and to compete against imports which are quoted as their price less 6p.
Big industry could compete with big industry in France. We have to make up our minds about whether we want an 134 industry which is balanced between big and small, and make our arrangements accordingly. We cannot have it both ways. If we want a big industry that can compete, the small industry will be unable to compete. Perhaps the industry must take that on board and debate agressively within its own framework.
We are trying to have it all ways. We are trying to protect a morass of small producers who do a super job, at the same time as trying to make it possible for the bigger producers, which are incredibly efficient, to compete effectively with the threat from across the water. It is clear that if we do not indulge in equalisation schemes the big industry can and will compete. We must therefore have a clear idea of the future structure of the industry when deciding on the course we take.
I shall conclude with a plea for a major "Buy British" campaign in this country. We can do it. The industry can get together and put its mark on its produce within the two-tier structure. It can say "This is a British bird inspected to British standards. Buy British and eat a British bird". I do not want to coin the slogans. The industry can do that far better than I. But it would like to know from the Minister whether it will be able confidently to mark British birds with a British mark, and whether there is any legal objection to that—I am thinking of the French effilé mark.
There are problems ahead—I have tried to explain how they relate to the structure of the industry—in terms of inspection. There are rumours that the French are pouring still more resources into a massive broiler fowl production plant to produce birds for third country consumption. That will put a lot of poultrymeat on the world market, and that is bound to affect our home market. It is therefore essential that we do not indulge in unnecessary high-cost inspection methods. We shall then be able to compete with the threat when it came.
Above all, the industry—to return to the subject of confidence referred to by my hon. Friend the Member for Devon, West—needs to know the form. It is undoubtedly resilient and is determined to remain so. It does not want to be buoyed up with false hopes. It wants to know where it stands. It does not want to indulge in wishful thinking that M. Bourgoin might go broke. We know that he will not go broke but will be propped up by the French Government, because that is the structure of the deal—although not officially. Our debate tonight underlines this important confidence-essential.
§ Mr. Bob Cryer (Keighley)
I shall be brief, and I apologise for having missed the Minister's speech. I have questions to put, because a number of my constituents work in a large poultry packing plant. I hope that the Minister can answer them.
The British Poultry Federation lobbied Parliament several months ago to raise the problem of unequal charging. Doubtless, hon. Members from both sides of the House attended that lobby. It was a serious issue at that time.
In the explanatory memorandum 5704/81 the Government say that they will bediscussing these proposals with the objective of securing realistic arrangements which all Member States will undertake to apply".135 I should be grateful if the Minister could explain which "realistic arrangements" of application he has in mind, and, most important, how long he envisages it will take to get these arrangements into operation.
The poultrymeat industry is undergoing severe competition, particularly from French imports, and there is clearly a time limit up to which the British industry can tolerate unfair competition under which the costs of inspection abroad are not fully met by the industry, contrary to what happens here. It is only a matter of time before serious harm is done to our industry.
§ Mr. Colin Shepherd
Is it not the threat rather than the actuality of imports that is causing concern?
§ Mr. Cryer
I must tell the hon. Gentleman that when I met representatives of the poultry industry they said that in the wholesale catering sector there were already considerable amounts of imported meat that were affecting them. They were much concerned about the retail side, too.
I ask the Minister to say what time scale the Government have in mind. It is a matter of considerable urgency, and I hope that he will be able to assure the House that he will act with speed.
If the Minister cannot achieve the time scale that he wants, and if he cannot achieve the position that he seeks, is he prepared to recommend, as has been suggested, that any subordinate legislation that he is required to bring in under EEC directives should be put before the House with a recommendation that it be rejected? If he is prepared to take that attitude, he must recognise that it will be a card up his sleeve and may well encourage proper negotiations, with a limited time scale, resulting in realistic arrangements that can be brought into effect quickly and ensure that there is proper competition, without hidden or direct subsidies that form unfair competitio for the British industry.
§ Mr. David Myles (Banff)
It should be generally understood in the House that there has never been an EEC regulation for poultrymeat products, as there is for most agricultural products. The poultry industry, like the horticulture industry, has had to rely on the concept of a common market, with harmonisation of State aids, hygiene regulations and so on, so that there would not be unfair competition between member States. Poultry products have never, as far as I know, been subject to MCAs or market support mechanisms, such as we have had for beef, sheepmeat or, to a lesser extent, pigmeat.
The documents being discussed tonight are mainly about the harmonisation of hygiene regulations and, while we have an industry that is as efficient as any in Europe, and one that maintains hygiene standards that are higher than most other States, all sectors of the British poultry industry have been facing a critical situation in the last few months.
In the United Kingdom, £1.5 million was paid to assist in phasing in all the inspection services required as a result of directive 71/118. In January my right hon. Friend the Minister of Agriculture, Fisheries and Food announced a further £2 million subsidy towards inspection costs. This represents about 50 per cent. of the total costs of inspection. Other member States have found it necessary 136 and important for their industries to provide Government funds to a greater extent. This is largely what has created the present problems facing the British poultry industry and led to the likely attack in the coming months on our turkey industry from such plants as that operating in Brittany.
The proposals that veterinary surgeons should be present in slaughterhouses at all times is surely unnecessary. Poultrymeat inspectors are capable of performing the necessary duties and vets should be employed on a consultancy basis only, or for random checks.
Turning to the second propoal, the British Poultry Federation's costs equalisation scheme comes to an end next month. This has helped small slaughterhouses and is highly commendable. I hope that it can continue after the end of August. The practical problem of collecting a standard charge is such that we should resist this proposal. I was pleased that my hon. Friend the Under-Secretary said so in his speech.
I welcome the proposal to extend the derogation allowing the production of un-viscerated poultry, New York dressed or long-legged, or any other euphemism, in licensed slaughterhouses. I have such a poultry slaughterhouse in my constituency which does a substantial trade in those birds.
§ Mr. Kenneth Carlisle (Lincoln)
My hon. Friend is very articulate about inspection. Does he agree that the whole context of the poultry industry and the great difficulties that it is facing far and away override any of the matters connected with inspection, and that what the Government have to do is tackle the basic problem of the industry?
§ Mr. Myles
I welcome my hon. Friend's intervention and the fact that he has been able to get into the debate. Currently, Dutch and French imported chickens are selling at 6p a pound below our market prices. By 1977 the British poultry industry had developed quite an export trade of 4 per cent. of production. In 1981 it is expected that the industry will be fortunate if it can keep 90 per cent. of our own market. I urge that something be done to rectify the situation.
§ Mr. Wiggin
The hon. Member for Edinburgh, East (Mr. Strang) assumed a welcome, agreed on both sides of the House, to the basic criticism of this Community document. I am grateful to him for that. He made the important point, which perhaps escaped one or two other hon. Members, that the question of poultrymeat hygiene is not exclusively one for the Community, but is a matter of considerable domestic importance to make certain that we have high standards in our poultry slaughterhouses. but if these standards are unreasonably high, so are the costs, and that really is the nub of the complaint of the industry.
I should perhaps go into slightly greater detail about what we have in mind in modifying existing arrangements in this country. I emphasise that no decisions have yet been taken and that we still await comments from several important organisations. However, I can confirm that we are thinking of drawing a distinction between establishments which wish to use the Community health mark on some or all of their production and those which do not wish to use the health mark at all.
137 For the first category we would maintain the existing detailed Ministry guidance on numbers of inspectors and on veterinary attendance; for the second we would withdraw the detailed guidance and leave it to the individual local authorities to determine the arrangements necessary to meet their obligations under the regulations to provide inspection of carcases under veterinary supervision.
We believe that in that way it should be possible for the poultrymeat inspection service to be provided within the context of the existing regulations at a lower cost to the industry, while maintaining the essential safeguards which the service provides to the consumers of poultrymeat.
My hon. Friend the Member for Hereford (Mr. Shepherd) raised the question of a British quality mark. I understand that the British Poultry Federation supports the idea for premises not using the EEC health mark. However, there is no provision in the regulations for the use of such a quality mark. That would be a matter for the industry, which will no doubt bear in mind the need to comply with the general provisions of the Trade Descriptions Act and the Food and Drugs Act. We shall complete and issue a revised circular as soon as we are in a position to do so. We hope that this will be during August, but the matter is not entirely in our own hands.
The hon. Member for Edinburgh, East, like many other hon. Members, finished with general comments on the state of the poultry industry. Bearing in mind your strictures, Mr. Deputy Speaker, I shall not go too far down that road, but I should say that we are in close touch with the leaders of the poultry industry in the United Kingdom not only on hygiene questions, but on all the other issues that are causing concern and can distort trade, including the increases in production elsewhere in the Community with the help of substantial national aids.
My hon. Friend the Member for Devon, West (Mr. Mills) quoted my right hon. Friend. He was actually quoting from an NFU press handout, so at least there was no question of bias in this matter. We appreciate the problems and are determined to ensure that the United Kingdom industry is not destroyed by unfair competition from abroad. We have taken these matters up in Brussels and my right hon. Friend the Minister of Agriculture, Fisheries and Food has made it clear that he will continue to press for effective action on them. He intends to use his period as President of the Agriculture Council to stress the need for greater attention to be paid to the whole question of national aid and other practices that can, and do, prevent fair competition.
The hon. Member for Grimsby (Mr. Mitchell) described the directive as pointless and unnecessary, but that seemed to go against what his hon. Friend the Member for Edinburgh, East said about the importance of poultry hygiene. I tried to explain the details of timing in my opening speech.
My hon. Friend the Member for Bury St. Edmunds (Mr. Griffiths), with his usual eloquence, poured much 138 scorn on the question of timing, and I am conscious of the apparent Gilbert and Sullivan situation of seconds per bird being discussed on the Floor of the House, but if inspection procedures are to be fair and equal some yardsticks have to be laid down. They may be worked out in seconds per bird, but we are really talking about numbers of inspectors on line. There will be the same number in French and Italian factories as in British factories. Such a yardstick has to be used. As my hon. Friend knows, time is money and standards have to be laid down.
My hon. Friend the Member for Hereford (Mr. Shepherd) mentioned New York dressed poultry. He will know that farm production is already exempt from the hygiene regulations for that. I shall bear in mind what he said, and I have no doubt that his comments about a permanent derogation will be read with great interest.
I have dealt with French competition, but it was raised by a number of hon. Members, including my hon. Friends the Members for Perth and East Perthshire (Mr. Walker), for Devizes (Mr. Morrison) and for Banff (Mr. Myles) and by the hon. Member for Keighley (Mr. Cryer). The competition coming from France, particularly in the turkey industry, is not illegal, but the Government are acutely conscious that if industrial subsidies are to be used for the production of what is a semi-factory operation, there will be a distortion not only in the poultry market, but in that for pigs and for other factory types of production.
My right hon. Friend has made it clear that he intends to raise that matter with the Commission as it breaches so blatantly the whole principle of the CAP. He will use his position during our Presidency to make that point firmly.
§ Question put an agreed to.
That this House takes note of European Community Document No. 5704/81 amending Directive 71/118 concerning hygiene in poultry slaughterhouses and supports Her Majesty's Government's objective of removing inequalities between Member States in the implementation of that Directive.