§ 61. Sir H. Williams
asked the Parliamentary Secretary to the Ministry of Food whether it is intended to pay compensation to food distributors who incurred losses in connection with the increase in the price of sugar of 1d. per lb. in September, 1943?
§ Mr. Mabane
As the answer is long I will, with my hon. Friend's permission, circulate a statement in the OFFICIAL REPORT.
§ Following is the statement:
§ No, Sir. The price of sugar to the public was increased by 1d. per lb. on 19th September, 1943. In order to minimise the special profits which would otherwise have accrued to dealers, wholesalers and retailers who hold stocks of sugar, it was arranged that the price of sugar purchased by distributors should be increased from dates earlier than 19th September, with the intention that, on average, the distributors would dispose of their stocks at the old price and would be left on 19th September with stocks purchased at the higher price. A similar policy was pursued when the price of 1145 sugar was reduced by 1d. per lb. in December, 1941. This policy is intended to minimise stock profits and losses arising out of changes in controlled prices. It is recognised that under this procedure distributors holding stocks in excess of the average benefit when prices are increased and lose when prices are reduced, and the converse applies to distributors holding stocks below the avergae. A meticulous adjustment of the profits and losses of food traders on the occasion of a price change would, however, involve a nation-wide inventory of stocks which could not be justified in present circumstances. These individual differences are incidental to trading, and my Noble Friend does not intend to pay compensation to distributors of sugar who have incurred losses in connection with the recent price increase nor to recover profits from those distributors who made profits on the same occasion. The general policy being followed by my Department in this matter is, I understand, acceptable to food traders. Discussions are, however, taking place between representatives of the trade and officers of the Ministry on the detailed procedure to be adopted in future cases.