GOVERNMENT MILK POLICY. (Hansard, 7 December 1937)

§ Colonel Sir Edward Ruggles-Brise
(by Private Notice) asked the Minister of Agriculture and Fisheries the detailed arrangements for giving effect to the price insurance plan for milk used for butter and cheese outlined in the White Paper on milk policy last July, and whether the Government have taken into account the changed level of prices and costs?

§ Mr. W. S. Morrison
Yes, Sir. Paragraph 7 of the White Paper indicated the general outline of a price insurance plan under which Exchequer assistance would be payable, within the limit of unspecified standard gallonages, in respect of milk used in factories for butter and cheese and milk made into cheese on farms, in the event of the average market prices of imported butter and cheese falling, over a period, below standard prices of 100s. and 56s. per cwt. respectively.
In the legislation to give effect to the White Paper policy, the Government will propose that the standard gallonages for milk used in Great Britain for butter and cheese should be 125,000,000 gallons per annum in each case. The Government have also reviewed the figures to be fixed for the proposed standard prices. They have taken into account the factors referred to in my hon. and gallant Friend's question. They also consider that it would be desirable to take some account of the seasonal variation in the quantities of milk available and in the costs of production, and the forthcoming legislation will provide that the price levels at which Exchequer assistance should begin to operate should be 112s. in summer and 120s. in winter per cwt. of butter, and 62s. 6d. in summer and 67s. 6d. in winter per cwt. of cheese. At present the average prices of imported butter and cheese are 133s. and 70s. 6d. per cwt. respectively. It is also proposed to provide for an independent review of both standard prices and standard gallonages at three-yearly intervals.

§ Mr. T. Williams
In the new calculation which the Government appear to have made, have they reached any conclusion with regard to the variation in the quantity of milk available for manufacturing purposes; and will the Government guarantee vary in accordance with the number of millions of gallons of milk made available for the manufacture of butter or cheese?

§ Mr. Morrison
The Government guarantee is based upon a standard gallonage of 125,000,000 gallons for milk made into butter, and 125,000,000 gallons for milk made into cheese. That is the standard gallonage, and the whole price insurance plan is based upon that gallonage. As I said in the last part of my answer, the standard gallonage will be subject to a three-yearly review in the light of the circumstances.

§ Mr. Williams
Do I understand that the gallonage of 125,000,000 means that, once the quantity exceeds 125,000,000 gallons, whether for butter or for cheese, the price insurance plan will operate; and that, once the quantity available for manufacture falls below 125,000,000 gallons, the Government guarantee will cease?

§ Mr. Morrison
No, Sir; all that it means is that, if the standard gallonage is exceeded, the amount of Exchequer assistance per gallon will be pro tanto reduced. It is similar to the operation of the Wheat Act, where the standard amount of wheat guarantees the price. If the amount of wheat exceeds that, the amount of the guarantee is diluted in proportion.

Mr. Alexander
May we regard the procedure to-day with regard to this announcement as a precedent, so that Members of the Opposition can get similar information if they put down a Private Notice question?

§ Mr. Speaker
I am not quite clear what the right hon. Gentleman means. Perhaps he will explain.

Mr. Alexander
I have always understood that in Private Notice questions, before they can be passed by the Chair, there must be a note of urgency.

§ Mr. Speaker
That is the case in this particular instance. I have satisfied myself that this was the only opportunity the right hon. Gentleman had of stating his policy to the House.

§ Mr. Arthur Greenwood
Will the Secretary of State for War follow the same precedent?

§ Mr. Speaker
He did not make any application to me to make a statement.

§ Mr. Leach
Will this new policy involve an increase in the expenditure of public money?

§ Mr. Morrison
No, Sir; that depends upon the course of butter and cheese prices. This is a price insurance plan, and the liability of the Exchequer is entirely contingent upon the prices of imported butter and cheese falling below the level specified in my answer.

Mr. Alexander
If I may return to the point of procedure, is it not a fact, with regard to the announcement of an important policy of this kind, that the Government have at their disposal the whole Parliamentary time of the day, and that, if they wished to make an announcement of policy of this kind, which is not urgent, it could have been taken at any time that the Government liked to make the announcement, so that we might have an opportunity of debating it?

Mr. De la Bère
Where is our wandering boy to-night?

§ Mr. Bellenger
On a point of Order. Have you any method, Mr. Speaker, of stopping such irrelevant remarks, which prevent a serious answer being given to a serious question?

§ Mr. Speaker
The hon. Member must recollect that I cannot stop a remark after it is made.

§ Mr. Bellenger
If you cannot prevent it after the remark has been made, can you take steps to prevent similar remarks from being made in the future?

§ Mr. Speaker
I do not know when such a remark is going to be made.

Mr. Alexander
When the irrelevant remark was made from the other side of the House, I was hoping to get an answer from you, Sir, to my question as to procedure.

§ Mr. Speaker
The right hon. Gentleman asked me a question which it would be more suitable to put to the Leader of the House. I cannot control the business of the House.

§ Mr. Wedgwood Benn
May I submit to you, Mr. Speaker, that in deciding whether this matter should be raised in such a form by Members of the Opposition asking questions and making criticisms, account should be taken of the fact that the Government themselves have it in their power to provide time at any period during the Session?

§ Mr. Speaker
The right hon. Gentleman asks me a question about what is the common practice of the House. It is a common practice in this House, when a statement of policy is to be made, to allow a question to be put to the Minister and the Minister to make a reply. If the right hon. Gentleman asks me whether the Opposition may do the same, my answer is that of course they can.

Mr. Alexander
May I ask the Prime Minister whether, if that procedure is likely to be pursued again, it would not be courtesy to supply the Opposition with a copy of the answer?

§ The Prime Minister
I am not of opinion that in this case there was any discourtesy to the Opposition in not supplying them with a copy of the answer. The question which was put to my right hon. Friend, and which he has answered, did not raise any new point of policy, but merely filled in some details of the policy which has already been set out in the White Paper.

§ Mr. T. Williams
This is not the first, but perhaps the fifth or sixth time that a similar statement has been made just on the eve of a Parliamentary Adjournment, when the Opposition have had little or no time to grasp the significance of the statement. When such a statement is made as that which the right hon. Gentleman has made to-day, we have obviously no opportunity of putting relevant questions.

§ Sir A. Sinclair
Is not the short point this, that when a Private Notice question is asked by arrangement in order to enable the Government to make a statement of policy, it would be a good plan to let the Leaders of the Opposition parties know?

§ Mr. Sandys
Is there any reason why the Opposition should be exceptionally favoured in matters of this kind?

§ Mr. W. Roberts
Arising out of the original answer, I would like, in view of the very complicated nature of that answer, to ask the right hon. Gentleman a simple question: What, in fact, will the arrangement which the right hon. Gentleman has now made mean in value to the Milk Board per gallon of milk? What will be the value of each gallon of milk sold by the Board, taking into consideration the price obtained for it and the subsidy?

§ Mr. W. S. Morrison
In my amplification of the White Paper policy, I have made it clear that the answer to the hon. Gentleman's question cannot be immediately given. The actual return to the pool depends upon a number of factors, including, in particular, the sort of bargain that the Board are able to drive with the manufacturers of milk. As regards the calculation of the additional advantage in the event of the guarantee coming into operation, that will depend upon the particular formula used for converting the price of imported butter and cheese into milk, and that is a matter which is under discussion at the present moment with the Milk Board.

§ Mr. Roberts
Surely, under this price insurance scheme, as it has been called, there must be some minimum price which will be guaranteed? May I ask the right hon. Gentleman whether there is any minimum figure below which the value cannot fall?

§ Mr. Morrison
As I have said, the price of manufactured milk depends in the first place upon the price which the Milk Board is able to exact from the manufacturers. Therefore, the minimum price will be affected by that also. Another factor of uncertainty which is not yet clear is the precise formula to be used for converting the price of imported cheese and butter into milk, and that, as I have said, is a matter which at present is under discussion. I think that, when the Bill comes to be printed and placed before the House, the hon. Gentleman will be in a position to make a more accurate calculation as to the answer which he requires.

§ Mr. Greenwood
In view of the obvious difficulty of the problem, will the Government make arrangements for a discussion in the House?

§ The Prime Minister
I would point out that the arrangements which my right hon. Friend has stated to the House cannot be put into operation without legislation. Therefore, when the Bill is introduced, there will be ample opportunity to discuss the matter.

§ Mr. Stephen
Arising out of that answer, can the Minister say whether the Financial Resolution will be introduced before the Christmas Recess?

§ Mr. W. S. Morrison
I cannot say that.

§ Mr. Maxton
Then where was the need for the urgency of the statement?

§ Mr. Morrison
The fact is that the milk industry itself is extremely anxious as to the position, having regard to its future. These contracts have to be negotiated a long distance in advance, and it is desirable, in the interests of the industry and of all concerned in it, that as early information as possible should be given to them. I have answered this question so as to give the House the first information before I give this amplified information to hon. Members or to deputations. I have informed the House first.

§ Mr. Stephen
Does that mean that these people are to enter into contracts based upon the assumption that the House will accept this statement and pass the Financial Resolution, without the consent of the House having first been got to the Financial Resolution?

§ Mr. Morrison
No. No contract will be entered into in advance of legislation being passed. But at the same time there are many preliminary matters which will have to be discussed, and this is one of them. Of course, no board would be so rash as to enter into any contract on the basis of a statement of this kind before Parliament has given its consent to the principles involved.