POTATOES (1940 CROP) (CHARGES) ORDER. (Hansard, 14 August 1940)

§ Mr. Quibell (Brigg)
This Order fixes the prices of potatoes for this month, and I want to suggest that they do not make due allowance for the increases in the cost of production. The prices fixed are approximately those that operated a year ago. Since that time the costs of labour and material have considerably increased. Further consideration, therefore, should be given to the matter. I must make a protest that there is not a greater differentiation in the Order between the price for what we call limestone potatoes and the price of white potatoes. The limestone potatoes have for the last 10 years fetched in the open market 20S, to 30s. a ton more than the ordinary white potatoes. The limestone growers have put up with a yield of from six to seven tons an acre, and seven tons is an exceptional crop.

§ The Parliamentary Secretary to the Ministry of Food (Mr. Boothby)
On a point of Order. I think that my hon. Friend is discussing the wrong Order. The question of prices is not raised in the Order I have moved.

§ Mr. Quibell
I do not think I am mistaken, for the matter I wish to raise comes under this Order. These levies of 5s. 6d., 6s. and 7s. 6d. go on to the prices of potatoes, and they mean that in many cases something like £3 15s. an acre will go into the Potato Fund. For what is that fund to be used, and when is it to be used? When are the promises that have been made to be met? The huge levies which the grower has to pay must be a charge on either the grower himself or the consumer. They should go into the fund to help the industry, either by taking the surplus potatoes or by using them for manufacturing purposes. The only fair way of dealing with this matter is for the Ministry of Food to take over the whole crop of potatoes. They have encouraged people to grow potatoes, and with so many people growing sufficient for the use of their own families there is little demand for them and there will be a huge surplus. I warned the Government a year ago that the Ministry should use this fund to implement the promises that were made to erect processing factories for dealing with surplus potatoes 865 and to manufacture them into animal food, which I believe is a mistake, or into potato flour, which I think should be done.
The growers want some definite statement as to what the Ministry propose to do with the crop. One of their difficulties is that they want money. The Ministry of Food should take this crop into their hands and do with it what they have done with other kinds of food. If they took the entire crop over at a reasonable price, they would find money for the farmers which they could use for preparing for next year's crop, and it would prevent any kind of speculation with potatoes. The Parliamentary Secretary wants to dismiss this matter in a word or two, but had we not been held up by the previous Debate he would have had a case to answer. Some of us have spent years in close contact with the growers. We have seen them ruined year after year because of variations in prices, and we now want the Government to fix such a price level as will encourage growers to grow a reasonable amount and to supply the public with its needs. I think it is due to them that they should have some assurance as to price levels, because the price will have to be increased progressively, and should be increased so much per month until next April or May. I hope we shall have some assurance that money taken out of the industry will be put into the manufacturing side of processing, so that when there is a surplus of potatoes we shall be able to use them as food.

§ Mr. John Morgan (Doncaster)
I am sorry to intervene, realising that there is another Debate to follow, but the Minister must be reminded that he is taking the first step in the wrong direction in dealing with a vital food. Can he tell us whether the Ministry have their factories in readiness to deal with that part of the crop which may be a drug on the market this side of Christmas? How many of the factories are ready to be used and where are they? It would be a disaster of the first consequence to agriculture if the potato crop were mishandled this season. If it is we shall not have potatoes next year. It was touch-and-go this time, and if the situation is mishandled we shall be in a muddle over the most vital food crop that the country 866 can produce. The Minister ought to make it clear, if not now at any rate at an early stage, exactly what he proposes to do with the levy before the farmer puts his potatoes into clamp. Why should he put the surplus crop into clamps? Some hon. Members have their own lawns under potatoes, and that is so in hundreds of thousands of other cases all over the country, and there will not be a firm market for potatoes at the Minister's prices between now and Christmas. He must take that fact into account and tell us when he intends to use these levies and in what form.

§ Mr. Butcher (Holland-with-Boston)
I shall not detain the House in view of the important statement which is to follow, but I feel that it would be wrong if those who are so much interested in potatoes as the two hon. Members who have spoken and myself did not press the Parliamentary Secretary for a very early statement indeed of the Government's plans for dealing with the potato crop. The levy which we are invited to approve tonight goes into the Potato Fund, and the time is now ripe for a definite statement on how that money is to be used, how much of it has been used, whether factories have been put up and whether they are yet ready for operation. I understand that the erection of one of them about which I know something has been held up a little through difficulties over building materials, and I hope the Parliamentary Secretary will take note of that fact and speed up its completion. Under another law minimum and maximum prices have been fixed, but, in fact, there is no trade, and I urge that this Potato Fund should be used to enable the Government to come into the market in a big way. Here is the Potato Fund and there are the potatoes, and I ask for an assurance that the Government should come into the market with this Potato Fund within the next few days or weeks; and be a buyer of potatoes on a big scale, so that the farmer may get money for the potatoes which he has grown and be able to get his seed ready for next year.

§ The Parliamentary Secretary to the Ministry of Food (Mr. Boothby)
I regret that we are not able to have a debate upon this subject, because I recognise that it is one of vital importance, and we 867 all have to speak under considerable pressure. I would remind hon. Members that this particular Order does not lay down the prices of potatoes. They have been fixed for this year, and we have every reason to believe that with the yield as it is and in view of the assurance that I shall be able to give—and that I believe to be satisfactory—the growers will not do at all badly. Next year's prices have still to be fixed. They are under consideration, but we shall not be able to fix them until we are in a position to form some estimate of the prospective yield. They will not be fixed for some little time to come. The present Order in effect extends the application of the Potatoes (1939 Crop) (Charges) Order, 1940, for another year. That scheme of control is continued practically unchanged. It was designed to give effect to the statement on potato policy made by the Minister of Food in a reply to a Question by the hon. Member for East Aberdeenshire (Mr. Boothby) on 13th December last. That statement, which I vividly remember, provided for the following measures to be taken: (1) the fixing of minimum and maximum growers' prices for potatoes; (2) the setting up of an insurance fund from the proceeds of a levy to be imposed on the first resales of ware potatoes; and (3) the insurance fund to be used for (a) meeting the cost of the scheme and (b) ensuring growers a reasonable return for any surplus crop remaining at the end of the season. In addition to this the Minister, in replying to me at the time, said: In the event of a surplus, whether resulting from an expansion of acreage or exceptional yields, the Ministry of Food will make the necessary arrangements for ensuring that growers will be enabled to obtain a remunerative return on their potato crop as a whole.—[OFFICIAL REPORT, 13th December, 1939; col. 1208, Vol. 355.] I certainly stand by that pledge.

§ Mr. Butcher
Will the hon. Member forgive me? He has missed out the statement about fixing minimum prices. Does he stand for that part of the policy? The phrase runs: Minimum prices will be fixed on the basis of the new 1939 minimum prices with such adjustments as may be necessary to take account of increased costs of production and in relation to yield."—[OFFICIAL REPORT, 13th December, 1939; col. 1208. Vol. 355.]

§ Mr. Boothby
I should like to say that I do not think the prices for this crop will be poor, and my information is that on the yield anticipated at the moment, and provided the Ministry undertake to purchase the surplus potatoes, growers will not do badly.

§ Mr. J. Morgan
No, you must give them a firm market as soon as you can.

§ Mr. Boothby
I agree as to the desirability of getting a firm market, but I am not aware that the market—

§ Mr. Morgan
It is very dull.

§ Mr. Boothby
Well, that is seasonal. We have every reason to believe that the market will firm up. I have pointed out that the prices for next season are under consideration, and it may well be that we shall be able in a comparatively short space of time to announce prices for next season's potatoes which will be very satisfactory to the growers. That is my hope. I should like to say that while the Minister's statement related to ware potatoes only it has now been decided, after consultation with the trade interests concerned, to incorporate seed potatoes as well into the present scheme of control.
Let me come to Section (3), which actually prescribes the rates of levy payable. By licensed wholesale potato merchants, 5s. a ton; by retail distributors licensed to buy direct from growers, 7s. 6d. a ton; by licensed seed potato merchants, 2s. 6d. a ton; by licensed grower-salesmen 6s. a ton; and by persons licensed for particular sale transactions, 6s. a ton. I would like hon. Members to be clear on this point, that the levy is taken into account in fixing wholesale and retail prices, and its ultimate incidence does, therefore, fall upon the consumer, on whom its effect works out at about 1/37th of a penny per lb. This levy will be used for the purpose of enabling us to purchase any surplus that there may be, but I want to make it clear to the House and the country that in the event of the amount of money in the insurance fund being insufficient to meet this requirement, the Ministry of Food will still stand by its guarantee and will make arrangements for the purchase and disposal of any surplus potatoes. My hon. Friend knows that that is valuable.

§ Mr. Quibell
I know all about it.

§ Mr. Boothby
I was on his side when this question was asked, and I hasten to say that I am on his side now. I think when the end of the year comes he will find that his potato growers, as well as mine, will be very satisfied with what has happened.

§ Mr. Quibell
No.

§ Mr. Boothby
Yes, I think so, and I ask my hon. Friend to wait a little time. An hon. Member raised the very important point about the factories which we are setting up, and I should like to give the House a little information about this matter. Six factories are projected. Two are already in production. Three should be ready towards the end of November and the other one will, we hope, be ready by Christmas. We think that they will be of great advantage.

§ Mr. de Rothschild
Are these new factories?

§ Mr. Boothby
It depends upon what my hon. Friend means by "new." I will tell the House where they are situated; they are at Wisbech, Skelmersdale, Dundee, Boston, Selby, and, probably, Haddenham.

§ Mr. de Rothschild
Has not the Wisbech factory been functioning now for nearly three years?

§ Mr. Boothby
Yes, Sir. I did not say that they were all new. I said that some of them were projected. I am not trying to make excessive claims in regard to these factories but I think that hon. Members will agree that they will be of great assistance in dealing with any surplus potato crop in the future. There is only one change in the Order, in its comparison with the last one, which I ought to point out, and that is in the item relating to potatoes grown by a person whose total holding of agriculural land is less than one acre. That would exclude most gardens and allotments.
All I wish to say in conclusion is about paragraph 5 of the Order, which requires all the proceeds of the levy to be paid into the Potato Fund. It says that these proceeds shall be applied in the manner and for the purposes mentioned in the Potato (1939 Crop) (Charges) Order, 1940(b). These are the important words from paragraph 7 of that Order: 870 After defraying the expenses incurred by the Minister in connection with the scheme of control, it shall be applied in accordance with arrangements approved by the Treasury and the Minister for the benefit of potato growers. I can therefore give an absolute assurance to the House that the whole of the levy will be applied solely for the benefit of the potato growers. I hope that my hon. Friends will be satisfied with that, and that they will forgive me for making a rather brief statement.

§ Mr. Quibell
Is the provision in regard to potato flour confined to the making of animal food?

§ Mr. Boothby
It is not confined to being manufactured into animal food. There is a dual purpose.

§ Mr. J. Morgan
May I ask for the further assurance that the Ministry intend to deal with the whole crop from the point of view of the consumer, and not leave waste potatoes to be drawn out of the market and to disappear underground?