THE MEAT PROBLEM

Ashburton Guardian, Volume 55, Issue 127, 11 March 1935, Page 8

THE MEAT PROBLEM

BRITISH GOVERNMENT’S PLAN. TEXT OF THE WHITE PAPER, The following is the full text of the White Paper issued by the British Government last week on the subject of imports of meat into Britain:— Part I. 1. In a memorandum on the livestock situation issued as a White Paper (Command 4651) in July last, copies of which were sent at the time to his Majesty’s Governments in the Dominions and to the Government of Southern Rhodesia, attention was called to the .very serious decline which had taken place in 1932-33, and the first half of 1934, in the prices of fat and store cattle in the United Kingdom market. 2. The present crisis would appear to be due in the main to two causes. In the first place there is the general phenomenon of world depreciation and disproportionate fall of agriculture prices. Second', the meat industry has been specially affected by the expansion of overseas production which in some cases has been stimulated by the payment of subsidies. 3. It is clearly impossible for the United Kingdom Government to acquiesce in a situation which threatens ruin to the United Kingdom livestock industry. Part 11.

4. It is important here to observe * that the present difficulties of the United Kingdom livestock industry, as of United Kingdom agriculture in general, are not of its own creation. The agricultural industry in whicn breeding and feeding of livestock are an essential element gave employment in 1931, to nearly 1,500,000 persons and its production was valued at £254,000,000 of which livestock and livestock products accounted for between 70 and 75 per cent. During the last 25 years the net output of meat in the United Kingdom has remained approximately unchanged. During the same period the total population has increased by 10 per cent; the agricultural population has declined by. per cent, and imports of meat into the United Kingdom from all sources have increased by about 33 l-o P el 5. It will be apparent that neithei the general fall in prices during the recent depression nor the special fa which is threatening disaster to tne livestock industry are in any due to the development of production in the United Kingdom. 6 In this connection it is to be observed that while agriculture is .the biggest single industry in the United Kingdom, it is a predominating economic interest of the United Kingdom to maintain and if possible to expan her exports of coal and manufactuicul goods. It has always -been and sfill is recognised that the development of inter-imperial trade is of portance for this purpose. In as much, however, as the rest of the Empne s not in a position to absorb the w i or even the major part of exports (a still less of potential exports), ot un ted Kingdom industries it is an essential interest of the United Kl " g j maintain a substantial expoi . and manufactured goods to foiei o countries. Part 111.

7. In devising, measures to* deal with the meat crisis therefore it is the task of his Majesty’s Government in the United Kingdom to reconcile the need (1) of safeguarding with aue regard to efficiency the Home interests • (2) of providing for the due development of Dominion resources and (3) of preserving trade with foieig countries which is essential to United Kingdom exporting interests, in endeavouring to meet each of fhese neec s due regard must be had to the others. 8 In the Ottawa agreements witn Australia and New Zealand provision was made for reducing imports of frozen beef and frozen mutton and Jamb from foreign countries by amounts rising to 35' per cent, an for stabilising imports of chilled bee, at the level of the basic ChM year, namely July, 1931, to June, 1932 The Dominions on their part agieed to certain temporary measures ot stabilisation. The United kingdom Government undertook not to plac,. any v restriction on supplies of meat from the Dominions before July U 4 After Ottawa the United Kingdom entered into negotiations with Argentina, a country which is not only at present by far the largest source of her chilled beef supplies but m which she has immense capital investments and with which she carries on a veiy valuable trade. It was clear in those negotiations that the Argentine Government attached paramount importance to the preservaion of the tiade in chilled beef. Nevertheless owing to the increasing difficulty of the supply situation, the Government of the United Kingdom reserved the righ the agreement that was made o e a further reduction of imports ot foreign meat into the United Kingdom by reducing shipments of chilled beef by 10 per cent below the level of the “Ottawa” year provided that the amount so excluded was not effectively replaced by the import of meat from other sources except experimental slip men ts of chilled beef from the Dominions. Any reduction by more than JO per cent was to apply P IO P atelv to imports of Empire sources. Imports of chilled beef from South America have in fact been subject to an average reduction of 10 per cent, since November, 1932.

Fart IV. -10 -The effect of these measures has been that the total imports of foreign chilled and frozen beef, veal, mu Aon and lamb in 1934, decreased by 1 581,100 cwt or by 13.55 per cent as compared with “Ottawa” year. Imports of Empire dead meat of these categories in the same period increased by 1,123,000 cwt, or 16 per cent Taking chilled and frozen beef and veal alone, foreign imports decreased by 942,000 cwt, or 9.64 per cent., and Empire imports increased by 1,338,000 ewt., or 81.8 per cent. 11. In the case of beef, it now appears that these various measures were

merely palliatives. The forces depressing prices are again in the ascendant. The demand shows no definite signs of increasing and the weight ot supplies on the market remains excessive.

12. The price situation was summarised in a memorandum on “The Livestock Situation," published in July, 1934, referred to in paragraph 1. above. Since that date there has been a marked further declination in beef cattle prices which are well below the already unremunerative figures of a year ago. Part V. 13. Iu a memorandum of July, 1934, it was explained that the choice lay between (a) a drastic reduction of imports to the point necessary to sustain prices of United Kingdom livestock at a remunerative figure ; or (b) the introduction, in agreement with overseas countries, of a levy upon imports, the proceeds of which would be available for the assistance of the Home industry. (In the part of this statement which follows, as in the memorandum of July, 1934, the term “meat” does not include ibacon and ham.). In the latter case it was explained that the quantity of imports might either be left entirely free or subjected to such moderate protection as might be thought necessary to prevent the market from breaking altogether. It was further pointed out that without the consent of the countries concerned no duties could be imposed on Dominion meat before August, 1937, or on Argentine meat before November, 1936. 14. His Majesty’s Government in the United Kingdom are of the opinion that a plan based on a levy (with a preference to the Dominions) will afford the best long-term solution of the problem. The possibility cannot be excluded that in addition some regulation of the market may be desirable in the general interests of the producer's in certain cases or at particular times, but the United Kingdom government cannot regard as a‘satisfactory permanent arrangement a system under which the responsibility for the regulation of the market would rest upon them alone. In their view the intervention of the United Kingdom Government should be limited to the collection of a levy on imports and the application of the proceeds to the assistance of the Home Industry according to the needs of the market, overseas producers being thus left free to regulate their exports to this market themselves. 15. The immediate crisis was met by a temporary subsidy to the livestock industry, in order to give time for negotiation on the proposals for a levy. The Cattle Industry (Emergency Provisions) Act, 1934, provided for a subsidy not exceeding 5s per cwt live-weight, on certain classes of cattle for the period ending March 31, 1935. It was intended that any payments made under the provisions of the Act should be recoverable from the proceeds of an eventual levy on meat imports. 16. The proposals for a levy have not hitherto proved generally acceptable, 'but as the only available alternative to a levy is a severe, reduction of imports, his Majesty’s Government in the United Kingdom desire to present the essential facts of the situation in the clearest possible light. It is with this object that the present statement has been drawn np.

Part VI. 17. Failing agreement on the payment of a levy on meat imports, liis Majesty’s Government in the United Kingdom will have no alternative but to take steps to regulate during the currency of the existing agreements the quantities of imports to whatever extent is necessary to restore livestock prices to a remunerative level. * 18. The primary object which his Majesty’s Government in the United Kingdom have before them in this collection is to assure to efficient home producers a reasonable return, and not to stimulate an artificial expansion of the United Kingdom livestock industry. 19. In order that the Governments concerned should have a further opportunity to consider the immediate problem his Majesty’s Government in the United Kingdom have proposed to Parliament a continuation of the present Exchequer subsidv for a further short period, but it must be understood that they have no intention either of continuing the subsidy indefinitely or acquiescing in the ruin of the livestock industry. Part VII. 20. To sum up: . (1) It is the firm intention ot Jus Majesty’s Government in the United Kingdom to safeguard, the position of the United Kingdom live stock industry. (2) Having regard to the terms of the Ottawa and Argentine Agreements, the' only practicable means at present available to them for this purpose is a drastic reduction of the import of meat into the United Kingdom from all sources.

(3) If, however, the consent of the Dominions concerned, of Southern Rhodesia and of Argentina can he obtained to necessary variation of their respective agreements, it would be possible to deal ivitil the situation bv the imposition of a levy upon the import of meat into the United Kingdom with or without a measure of supply 7 regulation.

(4) The policy which his Majesty s Government in the United Kingdom desire to bring into operation as soon as they are in a position to do so is to assist the United Kingdom live stock industry, according to the needs of the market, from the proceeds of a levy on imports (with a preference to the Dominions), overseas producers being left free to regulate their own exports to this market themselves. (5) The question therefore arises whether, with the consent of the Governments concerned, a levy should be imposed upon imports forthwith as an alternative to drastic reduction of imports which would otherwise be necessary.

(6) If so, the following further question arises:—(a) Whether all import regulations should cease as from tbe date on which the levy comes into operation, or whether there should be a transitional period, after the imposition of the levy, during which a moderate degree of import regulations would be maintained; (b) whether the levy should be imposed on all meat, or only upon beef, veal and live cattle, bearing in mind that in the latter case a higher rate of levy may 7 be necessary than if the levy were applied over ithe whole field of imported meat, and that it would also be necessary to ensure that imports of lamb, mutton and pork are adequately controlled