HC Deb 26 February 1951 vol 484 cc1722-3
6 and 7. Mr. Donner

asked the Minister of Food (1) whether his attention has been drawn to the report of the Comptroller and Auditor-General revealing that £201,758 was paid to Holland for strawberry pulp in order to cancel the contract for the remaining 3,200 tons of this particular bulk purchase; and if he will make a statement;

(2) how the payment to Holland of £63 a ton for cancelled, because unwanted, fruit pulp compared with the price paid last year.

4. Mr. Osborne

asked the Minister of Food why he paid £63 per ton on 3,200 tons for strawberry pulp to Holland in order to cancel a contract; and if he will give an estimate of how much more it would have cost to have purchased the pulp and brought it to this country.

Mr. Webb

To meet the estimated needs of the jam manufacturers during 1949–50 my Department contracted to buy 9,500 tons of strawberry pulp in Holland at £126 a ton free on board. This was before the size of the home crop, and the quantity and quality of the amount pulped, were known, and it so happened that there was an exceptionally good home crop of strawberries from which considerable quantities of pulp were manufactured. Then, to the great surprise of the trade, there was a substantial fall in the demand for strawberry jam.

In these circumstances, it was clear that my Department would not only have to sell most of its pulp below the contract price, but would also have difficulty in finding buyers at any price. Faced with these poor prospects it was judged to be undesirable to incur further freight and other costs, including the cost of long storage in this country, and it was decided to stop further shipments. The Dutch manufacturers agreed to accept a compensatory payment of £63 a ton for about 3,200 tons which had not been shipped. It is estimated that by taking delivery of this pulp my Department would have lost at least an extra £27 per ton.

Mr. Donner

Is it not a very great deal to pay for something we do not get?

Sir P. Macdonald

Is not this an example of the folly of bulk purchasing by the Government?

Mr. Braine

Does not this transaction prove, if proof is necessary, that Government buying is a costly failure? Would the Minister not agree that the best service he could render the nation would be to advise the Prime Minister to wind up his Ministry forthwith?

Mr. Jennings

Does not the Minister realise that the whole country is full of alarm at these sorts of transactions?

Mr. Webb

I really must reply to some of these supplementaries. I admit that it was not a good buy. [Laughter.] All right. How many business men in this country, and represented in this House, ever effect completely good buys in all their transactions? I myself am amazed, considering the overall extent of the transactions of the Ministry of Food, amounting to £1,700 million a year, at the smallness of the number of times, when we are thinking ahead and estimating possible demands, that we sometimes turn out to be wrong, and find ourselves in a situation of this sort.

Mr. Nabarro

Including groundnuts?

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