HC Deb 11 June 1952 vol 502 cc344-63

10.27 p.m.

Mr. Frederick Willey (Sunderland, North)

I beg to move, That an humble Address be presented to Her Majesty, praying that the Tea (Prices) (Amendment) Order, 1952 (S.I., 1952, No. 978), dated 15th May, 1952, a copy of which was laid before this House on 15th May, be annulled. It would probably assist the House, Mr. Deputy-Speaker, if we were to take at the same time the following Motion: That an humble Address be presented to Her Majesty, praying that the Coffee (Amendment) Order, 1952 (S.I., 1952, No. 860), dated 29th April, 1952, a copy of which was laid before this House on 30th April, be annulled.

Mr. Deputy-Speaker (Mr. Hopkin Morris)

Certainly, if the House agrees.

Mr. Willey

Both these Orders affect the price of beverages. Whether one drinks coffee or tea, it is to cost more. We object to these price increases. I will deal first with coffee, which, as I understand it, has nothing to do with the question of subsidy. What it has something to do with is Government bulk purchase. What the Minister of Food has done has been to sign new bulk purchase agreements providing for a higher price, because all the coffee bulk purchase agreements expire this year. It is for the Parliamentary Secretary, therefore, to explain how it is that the Minister has signed these new bulk purchase contracts which lead to the increased prices of coffee, ranging between 4d. and 8d. per lb.

There are several questions that I want to put to the hon. Gentleman. I believe that one of the purposes of the bulk purchase of coffee—because it is not an essential foodstuff—is that we ensure to the Commonwealth and the sterling area dollar purchases of coffee. Is that still the purpose behind these bulk purchase arrangements? Secondly, I understood—the Parliamentary Secretary, of course, is far better informed than I about this—that we had reached the peak of coffee prices. I know that the hon. Gentleman can point to previous increases in price greater than the present increases, but I ask him to explain how it has come about that we have not, apparently, yet reached the peak of coffee prices.

My third question relates to an element in the price increases. How much of the price increase is accounted for by increased costs of roasting, packing and distribution? I ask that because, broadly speaking, the profit position of the companies concerned seems to be fairly satisfactory. The burden is on the Parliamentary Secretary to make out a case for the increased costs of processing and distribution.

I invite the Parliamentary Secretary—and this may save an intervention from the other side of the House and expedite our proceedings—to explain to hon. Members opposite how it comes about at all that a Government which denounced bulk purchase are, in fact, now on their own account bulk purchasing at a higher price.

Finally on coffee, I should like the hon. Gentleman to explain to those hon. Gentlemen who supported him during the General Election, which is not so very far away, how it comes about that he is asking the House to approve an increase in prices, because during the Election the whole burden of the campaign of hon. Members opposite was that all that was necessary to decrease prices was to have a Tory Government.

In the case of tea, let me make it clear that I have a very great respect for the tea trade and the way in which they have carried out not only rationing but also price control. They have done a very good job in carrying out a complicated operation, which many people at one time thought could not be successfully carried out by the trade.

I want to criticise not the trade but the Government. This price increase is not consequent on world prices, but is consequent solely on the Budget. It was the Chancellor of the Exchequer who gave the Minister of Food no option. A Minister from the Treasury ought to be here now, because the Chancellor did not leave it to the Minister of Food to announce this food increase. He made it himself. He said that the price of tea would be increased this summer, as it is now being increased, by the elimination of the subsidy.

The odd thing about this substantial increase of l0d. a pound is that it is being made at the very time when there is every sign that there will be a fall in the world price, and nothing could be more economically unsound and unwise than to have this very great increase of price just at the moment when world prices are likely to decrease. It could not happen at a more inappropriate time, because we know from experience that if there is an increase in the maximum price then it will be a more difficult matter to bring down the price than if the current price had been allowed to run a little longer.

On the general position of the food subsidy ceiling. I should like the Parliamentary Secretary to deal with this point. When we debated the question of an increase in the price of bread, he pointed out that the Chancellor had indicated that there would not be a reduction this year of £210 million, but when we finished the financial year food subsidies would be running at the rate of £250 million a year. If that is so I ask why is it necessary now to impose this price increase? If the Chancellor has allowed the Minister this wider discretion to determine price increases, why do it now? What is the impelling necessity to make this increase now?

I can only make a suggestion about it. It seems to me that the Chancellor is hoping to decrease the food subsidies by £210 million or thereabouts this year although he is not binding himself to do it. That is why he is putting pressure on the Minister of Food. So we have got to this position—we have an increase borne by the housewives amounting to £48 million as a result of the increased prices of bread and flour, and the Minister of National Insurance is to give the families of this country—it has not yet begun—£23 million by way of increased family allowances to compensate them.

Then over and above that increase, as a result of this Order there is a sum of about £13 million to add to the £48 million. Without taking into account the increased meat prices which we are going to have next week-end, we have the housewives bearing by way of increased prices for these two items alone a burden of £61 million, against prospective increased family allowances for the whole year of £23 million.

I can only deduce from this that the Chancellor is putting very strong pressure on the Minister of Food to do all he can to see that by the end of the year the subsidy has run at no more than £250 million for the current financial year. Indeed, it is an interesting thing that when we debated the question of bread the Parliamentary Secretary said: The problem before us was how best to achieve this saving of approximately £210million in the food subsidies."—[OFFICIALREPORT, 1st May, 1952; Vol. 499, c. 1832.] I think it is quite obvious that the Chancellor is putting pressure on the Minister and that in this financial year we will find that the Government intend to make a saving of about £210 million at the expense of the housewives.

The Government are increasing the price of tea this month and increasing the ration next month. Why should they do that in these stages? It is because the Minister wants to know, first of all, what effect this very substantial price increase has on the prevent level of consumption.

In other words, he wants to find out how many old age pensioners and how many families with a large number of children cannot even afford to buy two ounces of tea. He can only do so by imposing this price increase while we have a two-ounce ration. When he has ascertained that he can put up the ration, although everyone in the tea trade knows that he could have done that two or three months ago.

Having put up the ration he finds out what effect the increased price has on the increased ration. He now has accurate information. He knows that so many families will take less than two ounces and so many will take less than 2½ ounces, and he can say that his operation of increasing the price has been so successful in depressing demand that he can deration without having adequate supplies to meet the demand that would have come if the price of tea were such that the poor people could afford to buy it.

In my own constituency we are to have a Tea Week, with a tea queen, at a time when we are rationed at two or two and a half ounces. The tea trade believes there is going to have to be a lot of pressure and publicity to maintain demand at this new price, and it is quite clear from all that they have said that they believe this will depress the effective demand.

This is indeed a very substantial price increase. As the Explanatory Note to the Order says: This Order … increases the maximum price of all price-controlled tea by tenpence a pound. There is nothing here about the 3s. 8d. a lb. tea about which the Minister talked. This Order increases the maximum price of all present price-controlled tea by l0d. The Minister said there is to be a new cheap tea at 3s. 8d. a lb. That will be a new poor tea. When later I asked him a Question, the Parliamentary Secretary said there will be tea at 3s. 8d., 3s. l0d. and 4s. a lb. so that the tea at 3s. 8d. a lb. has already become one of a range running to 4s. a lb.

But the point is that this is admittedly going to be a very poor tea. We know that in the tea market it is very difficult to sell this poor tea; in fact, it is lagging on the market. We also know that through rationing, which has continued for so many years, the people of this country are not going to go through the expensive business of buying poor tea, because there is no more expensive way of buying tea than to buy poor tea.

From discussions I have had from people in the trade that is an offer to blind people to this steep price increase. The Minister will quote our price increases. I will give them to save him the trouble. In six-and-a-half years we increased the price of tea twice; first by fourpence in June, 1947, when the food subsidies were running at £324 million a year and world prices were against us; and we increased it by fourpence in May, 1951. The food subsidies were then running at £410 million and world prices were against us.

Now, after eight months of the Tories, the price is to be increased by l0d. when the food subsidies will be running at £250 million, and world prices are falling. I appreciate the difficulties of the Parliamentary Secretary. He will tell the House that he has to do what the Chancellor of the Exchequer tells him.

If food subsidies are to be slashed, there must be these enormous price increases. But why select tea, unless the Government are viciously attacking the poor people? The Chancellor himself announced this. He was not going to leave this to the Minister of Food. He said first that he was going to increase the price of bread. Nothing will affect the families of this country more than that. Nothing will affect the poor people more harshly.

I do not know what the Radio Doctor said about tea. He probably said that it has no nutritive value; but tea was the first thing to be taken to bomb-struck areas during the blitz. It was a morale raiser. If one goes into a working-class home, the first thing one is offered is a cut of tea. So having singled out the poor and said, first, that they are to pay more for their bread, it is now decided that they shall pay more for their tea. I think that this is a harsh, vindictive attack upon our people. At a time when all of us are trying to get some stability into the country, to take action like this is provocative and upsetting everything. I hope that even now the Parliamentary Secretary may say that, having reviewed the matter, he will not impose this increase.

10.44 p.m.

Mr. George Jeger (Goole)

I beg to second the Motion.

My hon. Friend has put forward his case ably and eloquently. I appeal to the Parliamentary Secretary to withdraw this Order. My hon. Friend referred to the fact that a cup of tea is a great morale raiser. During the war it was greatly used in shelters, and when bomb incidents had occurred. Nowadays, after shopping, the first thing the housewife needs to revive her drooping spirits is a cup of tea. After coping with the increase in prices and in the cost of living, she flies to a cup of tea.

The housewife was promised that the cost of living would stop rising if a Conservative Government were returned. While sipping that cup of tea she tries to relate the promises of the Conservatives when in Opposition to their practices when in power, and she recalls the posters on the hoardings, and the sympathetic words she heard when being wooed by the Parliamentary Secretary, among others, for her vote during the Election. She remembers those words in the Conservative Election manifesto: Our housewives have gone on bravely trying to feed families on two ounces of this or tenpennyworth of that Now she sees two ounces of cheese come down to one ounce, and tea going up to two and a half ounces, while the l0d. worth of meat is now 1s. 2d., and is shortly going up to 1s. 7d.

Sir William Darling (Edinburgh, South)

On a point of order. There is nothing about meat in the Order.

Mr. Deputy-Speaker (Mr. Hopkin Morris)

The hon. Member must confine himself to the Order.

Mr. Jeger

I am basing my remarks on the necessity for retaining tea at its present relatively low price because of its value in helping to cope with the difficulties which this Government have placed on the already over-burdened housewife. On a number of occasions during Questions recently, I have sought to elicit from the Minister of Food why the tea ration could not be raised to three ounces and I have been told that there was not sufficient tea. I was fobbed off with stories of how much tea it was necessary to have coming into the country to raise the ration to three ounces.

But the whole of the tea trade is emphatic in its assurances that tea could either be raised to three ounces or taken off ration altogether. The stocks already in the country or on the high seas would allow that to be done and the Minister has been described in the tea trade journals and other journals as being over cautious and very mean in his attitude to the housewife.

This increase of l0d. in the price at a time when there is sufficient tea to raise the ration to a level which would satisfy the needs of the community or take it off ration altogether, which is practically the same thing, is a mean thing to do. Not only is it mean, but it does not square with what I have always understood to be conventional economics.

The argument in the sphere of elementary economics was that when you had sufficient of a commodity in the market to satisfy demand, that was the time when people would buy, more particularly if rationing was being removed. If people are buying more, more trade is being done and there is a greater turnover. If there is a greater turnover, even on a small margin of profit, obviously the total profit is larger. Therefore, with an increased ration of tea, or tea coming off ration at the present price level there would be increased trade and increased profit. Is the present profit so low that many millions must be given to the tea trade by raising the price by 10d.? I would like the hon. Gentleman to answer that.

Perhaps he will get some information from the Stock Exchange Year Book to which I referred today to find out how profits of various tea companies were running. I found that one large tea concern in this country which before the war consistently paid a dividend of 10 per cent. has been going on to 15 per cent. and 15 per cent. plus a 7½ per cent. bonus, 22½ per cent. and last year 22½ per cent. plus a 7½ per cent. bonus. Another firm in the habit of paying 5 per cent. to 7½ per cent. dividend, last year paid a 12½ per cent. dividend. I do not think the tea trade is doing badly on the present tea ration and present prices.

Mr. Peter Remnant (Wokingham)

Perhaps, as he has been making so many researches, the hon. Member will continue them and get the prices at London auctions and compare them with the costs today, when he will find they are pence per pound below cost of production.

Mr. Jeger

I accept that, but I also accept the figure given in the "Economist" that immediately after the announcement made by the Minister that the tea ration was being raised, tea prices hardened from 2d. to 4d. per lb. They will go up one week and down the next. The reason is that there is speculation in tea and prices will fluctuate in accordance with stocks they have in hand, their gamble on what the future market will be, and whether they can hold out a little longer. We can only go, not by the fluctuations in the market, but by the published profits and paid-out dividends of the firms concerned. One can only go to the published authorities for this information, and not to the day-to-day markets, to see the fluctuations in price.

Mr. Remnant

I shall look forward in six months or a year's time to seeing the hon. Member rise again to treat the current figures so openly.

Mr. Jeger

If the hon. Gentleman will persuade the Minister to withdraw this price increase and bring it forward again in six months' or a year's time—if he is still in office—I should be willing to postpone my argument until that date and bring it into line with the published results at that time. But, in the meantime, we have to deal with the situation as we find it, and with the profits as we find them, and the price increase which we are being threatened in this Order.

I think that the tea trade is not in need of the financial assistance offered on this occasion by a price increase of l0d. per lb. It is obvious that the increase will go in part to swelling the profits of the tea trading firms at the expense of the poorer people of this country who, in the main, are the biggest tea drinkers. They cannot afford the various alternatives. Incidentally, one alternative, the drinking of coffee which has become more of a habit in this country, owing to the shortage of tea, will be more expensive, because of the increase in the price of coffee in the other Order which we are taking in conjunction with this Order.

I hope that the Minister will take note of the example of the sugar packets which have propaganda slogans and information printed on them. I think that after this increase in the price of tea one of the things which might be printed on the tea packets is a quotation from the broadcast by Lord Woolton on 13th October, 1951. He said: There is a story that the Conservatives would cut the food subsidies. That is not true. That would look very well on the side of a tea packet for which the housewife has to pay the increased price arising from this Order. It would help to draw the attention of the housewife to the facts of life in accordance with the political doctrine of the party opposite.

Surely, instead of raising the price in this way it would have been much better to have made an arrangement in accordance with the tradition of the Ministry, consulting the representatives of the trade and deciding, in a gentlemanly and amicable way, that there should be no controlled maximum price whatever; that in a steady market where there is an adequate amount of tea to satisfy the demand the free wind of competition should be allowed to blow unhindered, with a gentlemanly agreement by the trade that there should be some low-price tea of good quality which the Minister has told us on previous occasions was being guaranteed, even under this Order.

The rest could be left to fair competition, about which the Conservatives talk so much, allowing the tea trade to bring their own economic system to bear on the different prices of tea. That would have meant that one section of the trade would be competing with another, without the necessity of price control and the full l0d. increase which every firm will adopt in accordance with the time-honoured way of doing these things.

I remember hearing the Parliamentary Secretary saying, some time ago, "Our diet is dull and dreary and we know it." He talked about the increases in prices and reduction in the quantity of our rations. He told the housewives, and I happened to be listening, "Science is satisfied, so how dare you grumble?" The Parliamentary Secretary has caused a lot of grumbles in the course of his career, but none so many as he has caused during the last few months. This Order is the culmination of a long series. I warn the Parliamentary Secretary that while, during the last few years he may have talked himself into office, he is rapidly acting himself out of it, and he would be well advised to withdraw this Order to restore a little of his popularity.

10.55 p.m.

Mr. John Arbuthnot (Dover)

As one who is connected with the tea industry, I should like to say that the two speeches to which we have listened have been so full of inaccuracies that some of them should be corrected immediately. The hon. Member for Sunderland, North (Mr. F. Willey) said that there would be an increase in tea prices of l0d. per lb., indicating that the increase would operate throughout the whole field. He only mentioned, in passing, the fact that the trade has guaranteed to the Minister that there will be available a 3s. 8d. tea for everybody who wants it.

Mr. Alfred Robens (Blyth)

Sweepings.

Mr. Arbuthnot

Hon. Gentlemen opposite may talk about sweepings, but let me remind them that a considerable quantity of the cheaper teas on the market recently have been bought by the Co-op.

It was suggested that the object was to find out how many families would be unable to afford to buy tea at the new prices. The retail price lists which have been published indicate that whereas the old prices ranged from 3s. 2d. to 5s., the new ones range from 3s. 8d. to 5s. 4d. It should be borne in mind that the 3s. 8d. tea will assist the poorer family.

Another point was that we should have put up the ration two or three months ago. That does not come well from the hon. Member for Sunderland, North He knows that if his own party when in power had taken the action now being taken by this Government, the ration could have been raised two years ago.

Mr. A. G. Bottomley (Rochester and Chatham)

I am sure that the hon. Gentleman does not want to mislead the House. What has happened in the last 12 months is that Indonesia has begun to provide tea in great quantities and that Pakistan is producing more, so that more tea is available.

Mr. Arbuthnot

It is true that Indonesia is providing more, but had the party opposite taken the action of freeing the London tea auctions earlier, the increase in production would have taken place sooner.

The hon. Gentleman also talked about derationing without having adequate supplies. That is one of the important points that my right hon. Friend the Minister of Food has made. It is essential to ensure that we have got adequate supplies. The stock position at present is 143 million lbs., excluding anything that may be held in the Ministry of Food stocks which are not known to the public. By September, which is the low point in the tea cycle, we shall probably have about 100 million lbs. in stock. Therefore, it is untrue to say that derationing is taking place without us having adequate supplies.

The only other point I wish to make is that if the Government had failed to take the steps they have taken many of the tea gardens in Cachar, Darjeeling and Sythet, which are producing at a loss, would have closed and the workers would have been out of jobs and without means of subsistence. Surely it is not the intention of hon. Gentlemen opposite to grind in the dust the faces of the labour forces in India and Ceylon in this way.

11.0 p.m.

The Parliamentary Secretary to the Ministry of Food (Dr. Charles Hill)

Whatever disagreement there may be about the Order, let it be said, at the outset, that there is no disagreement on the virtues of tea nor on the important part it plays in the everyday lives of the vast majority of the people of this country.

The hon. Gentleman the Member for Sunderland, North (Mr. F. Willey) referred to the general subsidy situation, of which this is an expression, and raised once more the action which is being taken to achieve the new subsidy level at the beginning of the new financial year. Let me make abundantly clear that it is proposed to achieve the new level for the next financial year and to approach that level during the course of the present year.

The hon. Gentleman related this to the progress which is being made in the increases in social benefits. He did not, perhaps, complete the relationship, otherwise he would have referred, not only to the National Assistance increase on 16th June, amounting to some £25 million, but also to the increases in widows' pensions, sickness benefit, unemployment benefit, and industrial injuries benefit, which are planned for 31st July, to retirement pensions planned for 1st October, and to the family allowances planned for 1st September, amounting altogether to an annual increase in the social benefits of some £83½ million. I mention this so that the picture may be complete.

I believe it was in the hon. Gentleman's mind to examine it at the present point, for he referred, quite fairly, to the one increase—that for National Assistance scales—which comes into operation on 16th June. I would, for the sake of greater completeness, remind him that if one takes the position as it is now, in working out the plans envisaged by the Chancellor of the Exchequer, that the increases in flour, bread, tea, and meat amount to a reduction of subsidy of £115 million.

On the other side of the balance sheet, taking, again, the point of time we have reached now, and taking into account not only the increase of National Assistance benefits, but the value of income tax concessions, we have £253 million. Even if one takes what is being returned to income-tax payers this week—some £20 million—that alone is in excess of the £18 million which the removal of the tea subsidy has involved by way of increased prices.

The hon. Member for Sunderland, North went on, in effect, to ask why the steps, first, of removal of subsidy, second, of increase of the ration, and, third, of complete de-rationing and de-control, should be taken in that order. If I may paraphrase his words, or perhaps modify or moderate them, his argument was that the step of removing the subsidy was deliberately calculated to lower the level of consumption so as to make possible the subsequent stage of increase of ration and the final stage of derationing and decontrol. I say quite bluntly that this exercise is being planned on the assumption that the level of consumption will remain, though I am not going to prophesy that there will be no effect upon the level of consumption as a result of the price increase involved in the removal of the subsidy.

If I may put it in other words, we know that 40 million lb. of tea a month will be needed for the 2½ oz. ration; and we know that there will be imports of such a size as will permit the 2½ oz. ration. There is no element in the calculations which are being made which follows from an assumption, at which the hon. Member hinted, of a lower consumption.

Mr. F. Beswick (Uxbridge)

Is the calculation based upon the same individual consumption? In other words, although the total consumption may remain the same, is the hon. Gentleman assuming that the individual will consume the same quantity?

Dr. Hill

Yes. The calculation is made from our knowledge of what is consumed on the smaller ration and by allowing for a 25 per cent. increase in consumption as the ration goes up from two to 2½ oz. It may well be that the pattern of consumption will change. I am not seeking to deny that possibility. What I am seeking to do is to assure the hon. Member for Sunderland, North that no assumption of what may happen to the pattern of consumption has crept into the calculations and preparations which are being made for the second phase of the exercise, the raising of the ration to the level of 2½ oz.

The hon. Member went on to refer to the l0d. increase and asked—I think it is a fair summary of the question he put—"Why 10d.?" He will know that this system of controlled price is peculiar to the tea industry. He knows that there are some 3,000 or 4,000 different blends of tea on the market. He knows that at the outbreak of war, rather than seeking to name prices for each blend or each group of blends, it was decided to freeze the blend pattern and, as increases in prices became necessary, to permit increases which would operate over the whole of the field.

That means that when one comes to allow a single increase of price to operate over the whole field, of necessity, as it is a maximum, it must be a maximum which represents the greatest level of increase, even if that high level of increase is in respect of but one blend of tea.

Assurance has been obtained that there will be a sound quality tea available in sufficient quantities at 3s. 8d. a lb. to meet the public need. I agree that it is not enough to have the poorest quality tea. In fact, it is not economy to have low quality teas. So, bearing in mind the position from which we start—the lowering of the subsidy level, the decision to eliminate the subsidy on tea, the competitive conditions obtaining in the trade, and the stock position—it is thought that this first step will speedily be followed on 13th July by an increase in the ration to 2½ ounces, and then be followed, we hope before the end of the year, by the sweeping away of rationing and control from the whole of this field.

The hon. Gentleman the Member for Goole (Mr. G. Jeger) referred to the urgent need for competitive influences to get to work. I assure him that it is believed that the competitive instincts will be getting to work in the next phase in preparation for the full phase of competition in an industry which is essentially a competitive one. That is what is happening here.

The hon. Gentleman was generous enough so to refer to the character of the trade as to imply that an understanding could be safely and properly entered into with them and assurances have been received from the trade that while in the case of some of the more expensive teas the permitted increase will be 10d., in respect of the cheaper teas the increase will be substantially less than 10d., and in the middle range of blends the increase will be of the order of 8d.

Mr. F. Willey

I want to put the Parliamentary Secretary right on this. This is the elimination of the subsidy. It is an operation eliminating the subsidy. Would he explain how he is going to eliminate the subsidy if it is just fortuitous what price increases are made in particular blends of tea? Unless he has the material with him on the saving estimated over a year then it is just a guess.

Dr. Hill

If the hon. Gentleman will be patient I will explain. By making a single increase of l0d. in the maximum price it means that as that increase will obtain only in relation to the more expensive teas, in the rest of the field there will be smaller increases. There will also be competition in what is a highly competitive trade and this will influence prices within the field, other than prices at the very highest level.

Mr. Willey

The unit subsidy as announced by the Minister of Food for 1951–52 was 8½d. Since that time procurement costs have gone up so obviously the unit subsidy on a pound of tea must be more than 8½d.

Dr. Hill

The unit of subsidy on a pound of tea, at the time of removal of subsidy, was running at the rate of 8d. a lb. It would amount at the higher ration level to some £17 million for the year. Eightpence is the unit subsidy. If I may illustrate the point by inquiries that have been made as to the intentions of the trade in carrying out the understanding into which we have entered, out of 53 sample blends 15 will rise by 10d., two by 6d., four by 4d. or less, and the rest, amounting to 32, by 8d.

I want to add one word on a point which has not been raised in this debate but has been mentioned outside, that some people have found difficulty in the course of the last few days in getting their tea ration. Tea is flowing into the grocers' shops today just as it has flowed in the last few years, and nothing has been done administratively as part of this exercise to interfere with that flow. Where a grocer has been borrowing from the future, then he is caught on one foot at this moment. I want to make it clear that if a citizen is not able to get his tea ration from his usual retailer he should go elsewhere, for there is no binding registration in tea. If he has difficulties in the next few days he should go to the local food office for advice.

I will not weary the House by speaking further of the stock position. The hon. Member for Sunderland, North knows the position perfectly well, and I am sure the House is obliged to my hon. Friend the Member for Dover (Mr. Arbuthnot) for his well-informed contribution to the debate. Whatever else may be said of the selection of tea as part of the subsidy reduction, let it be said that the removal of the subsidy is what we

hope will be the first step in an exercise which before the end of the year will result in the removal of controls and the rationing of tea, which all will welcome.

I should like, briefly, to say a word about coffee. The hon. Gentleman the Member for Sunderland, North said that certain contracts would run out in the middle of the year and some at the end of the year. They are for the most part contracts within the Commonwealth. The hon. Member referred to the fact that bulk purchase was involved in the contract. It is. I am not going into the details of the contracts except to say that we are getting at the moment 50 per cent. of our coffee from Commonwealth sources, mostly East Africa and the Uganda. Our inability for currency reasons to obtain coffee from Brazil, however, means that we shall be getting two-thirds of our coffee from Commonwealth sources.

The hon. Member referred to the proportion which increased costs played in the increases. The increased price of coffee accounts for 3½d. of the 5d. per lb. and the l½d. is related to the increased costs of carriage, financing, distribution, and so on. The coffee price increase results from an increase in the price that we have to pay and we feel it is proper that we should pay, for coffee mostly from the Commonwealth.

As to tea, we believe that this is the first step in an exercise which will take tea away from rationing, and whatever may be said on the other side of the House that will be widely welcomed as a step towards freedom.

Question put.

The House divided: Ayes, 163; Noes, 184.

Division No. 157.] AYES [11.21 p.m.
Adams, Richard Brook, Dryden (Halifax) de Freitas, Geoffrey
Allen, Arthur (Bosworth) Brown, Rt. Hon. George (Belper) Deer, G.
Anderson, Alexander (Motherwell) Brown, Thomas (Ince) Delargy, H. J.
Awbery, S. S. Burke, W. A. Dugdale, Rt. Hon. John (W. Bromwich)
Bacon, Miss Alice Burton, Miss F. E. Ede, Rt. Hon. J. C.
Baird, J. Butler, Herbert (Hackney, S.) Edwards, John (Brighouse)
Balfour, A. Callaghan, L. J. Edwards, W. J. (Stepney)
Barnes, Rt. Hon. A. J. Castle, Mrs. B. A. Evans, Albert (Islington, S. W.)
Bence, C. R. Champion, A. J. Evans, Stanley (Wednesbury)
Benn, Wedgwood Chapman, W. D. Fernyhough, E.
Beswick, F. Chetwynd, G. R. Finch, H. J.
Bevan, Rt. Hon. A. (Ebbw Vale) Cocks, F. S. Fletcher, Eric (Islington, E.)
Bing, G. H. C. Coldrick, W. Foot, M. M.
Blackburn, F. Collick, P. H. Fraser, Thomas (Hamilton)
Blenkinsop, A. Craddock, George (Bradford, S.) Freeman, John (Watford)
Bottomley, Rt. Hon A. G. Cullen, Mrs. A. Freeman, Peter (Newport)
Bowden, H. W. Davies, A. Edward (Stoke, N.) Gaitskell, Rt. Hon. H. T. N.
Braddock, Mrs. Elizabeth Davies, Harold (Leek) Gibson, C. W.
Brockway, A. F. Davies, Stephen (Merthyr) Grey, C. F.
Griffiths, Rt Hon. James (Llanelly) McGovern, J. Ross, William
Hale, Leslie (Oldham, W.) McInnes, J. Schofield, S. (Barnsley)
Hamilton, W. W. McKay, John (Wallsend) Shackleton, E. A. A.
Hannan, W. McLeavy, F. Silverman, Julius (Erdington)
Hargreaves, A. MacPherson, Malcolm (Stirling) Simmons, C. J. (Brierley Hill)
Hayman, F. H. Mann, Mrs. Jean Snow, J. W.
Healey, Denis (Leeds, S. E.) Mellish, R. J. Sorensen, R. W.
Henderson, Rt. Hon. A. (Rowley Regis) Mikardo, Ian Sparks, J. A.
Herbison, Miss M Mitchison, G. R. Stewart, Michael (Fulham, E.)
Hobson, C. R. Monslow, W. Stross, Dr. Barnett
Holman, P. Moody, A. S. Sylvester, G. O.
Holmes, Horace (Hemsworth) Morgan, Dr. H. B. W. Taylor, Bernard (Mansfield)
Hoy, J. H. Morley, R. Taylor, John (West Lothian)
Hubbard, T. F. Morris, Percy (Swansea, W.) Taylor, Rt. Hon. Robert (Morpeth)
Hudson, James (Ealing, N.) Moyle, A. Thomas, David (Aberdare)
Hughes, Cledwyn (Anglesey) Murray, J. D. Thomas, Iorwerth (Rhondda, W.)
Hynd, J. B. (Attercliffe) Nally, W. Thomas, Ivor Owen (Wrekin)
Irving, W. J. (Wood Green) Neal, Harold (Bolsover) Wallace, H. W.
Isaacs, Rt. Hon. G. A. Noel-Baker, Rt. Hon. P. J. Watkins, T. E.
Janner, B. Orbach, M. Weitzman, D.
Jay, Rt. Hon. D. P. T. Oswald, T. Wells, William (Walsall)
Jeger, George (Goole) Paling, Will T. (Dewsbury) Wheatley, Rt. Hon. John
Jeger, Dr. Santo (St. Pancras, S.) Pargiter, G. A. Whiteley, Rt. Hon. W.
Johnson, James (Rugby) Parker, J. Wilkins, W. A.
Johnston, Douglas (Paisley) Pearson, A. Willey, Frederick (Sunderland, N.)
Jones, T. W. (Merioneth) Peart, T. F. Willey, Octavius (Cleveland)
Keenan, W. Poole, C. C. Williams, Rev. Llywelyn (Abertillery)
Kenyon, C. Popplewell, E. Williams, Ronald (Wigan)
King, Dr. H. M. Price, Joseph T. (Westhoughton) Williams, W. R. (Droylsden)
Lee, Frederick (Newton) Proctor, W. T. Williams, W. T. (Hammersmith, S.)
Lee, Miss Jennie (Cannock) Reid, Thomas (Swindon) Wilson, Rt. Hon. Harold (Huyton)
Lever, Leslie (Ardwick) Rhodes, H. Winterbottom, Ian (Nottingham, C.)
Lewis, Arthur Robens, Rt. Hon. A. Wyatt, W. L.
Logan, D. G. Roberts, Albert (Normanton) Yates, V. F.
MacColl, J. E. Roberts, Goronwy (Caernarvonshire)
McGhee, H. G. Robinson, Kenneth (St. Pancras, N.) TELLERS FOR THE AYES:
Mr. George Wigg and Mr. Royle.
NOES
Aitken, W. T. Darling, Sir William (Edinburgh, S.) Hurd, A. R.
Allan, R. A. (Paddington, S.) De la Bère, Sir Rupert Hutchinson, Sir Geoffrey (Ilford, N.)
Alport, C. J. M. Deedes, W. F. Hylton-Foster, H. B. H.
Amery, Julian (Preston, N.) Digby, S. Wingfield Jenkins, Robert (Dulwich)
Amory, Heathcoat (Tiverton) Dodds-Parker, A. D. Johnson, Eric (Blackley)
Arbuthnot, John Donaldson, Cmdr. C. E. McA. Johnson, Howard (Kemptown)
Assheton, Rt, Hon. R. (Blackburn, W.) Donner, P. W. Kaberry, D.
Astor, Hon. J. J. (Plymouth, Sutton) Douglas-Hamilton, Lord Malcolm Keeling, Sir Edward
Baldwin, A. E. Drayson, G. B. Kerr, H. W. (Cambridge)
Banks, Col. C. Duncan, Capt. J. A. L. Lambert, Hon. G.
Barber, Anthony Eccles, Rt. Hon. D. M. Lambton, Viscount
Barlow, Sir John Elliot, Rt. Hon. W. E. Law, Rt. Hon. R. K.
Baxter, A. B. Erroll, F. J. Legge-Bourke, Maj. E. A. H.
Beach, Maj. Hicks Fell, A. Legh, P. R. (Petersfield)
Beamish, Maj. Tufton Finlay, Graeme Lloyd, Maj. Guy (Renfrew, E.)
Bell, Philip (Bolton, E.) Fisher, Nigel Lockwood, Lt.-Col. J. C.
Bennett, F. M. (Reading, N.) Fletcher-Cooke, C. Longden, Gilbert (Herts, S. W.)
Bennett, Dr. Reginald (Gosport) Fort, R. Lucas, Sir Jocelyn (Portsmouth, S.)
Birch, Nigel Fraser, Hon. Hugh (Stone) Lucas-Tooth, Sir Hugh
Bishop, F. P. Fraser, Sir Ian (Morecambe & Lonsdale) Macdonald, Sir Peter (I. of Wight)
Boothby, R. J. G. Galbraith, T. G. D. (Hillhead) McKibbin, A. J.
Bossom, A. C. Garner-Evans, E. H. Maclean, Fitzroy
Bowen, E. R. Godber, J. B. Macleod, Rt. Hon. Iain (Enfield, W.)
Boyd-Carpenter, J. A. Gough, C. F. H. MacLeod, John (Ross and Cromarty)
Boyle, Sir Edward Gower, H. R Macmillan, Rt. Hon. Harold (Bromley)
Braine, B. R. Grimond, J. Maitland, Comdr. J. F. W. (Horncastle)
Braithwaite, Lt.-Cdr. G. (Bristol, N.W.) Grimston, Hon. John (St. Albans) Manningham-Buller, Sir R. E.
Bromley-Davenport, Lt.-Col. W. H. Grimston, Sir Robert (Westbury) Mark ham, Major S. F.
Buchan-Hepburn, Rt. Hon. P. G. T. Harris, Reader (Heston) Marshall, Sir Sidney (Sutton)
Bullus, Wing Commander E. E. Harrison, Col. J. H. (Eye) Maydon, Lt.-Cmdr. S. L. C.
Burden, F. F. A. Harvey, Air Cdre. A. V. (Macclesfield) Medlicott, Brig. F.
Butcher, H. W. Harvey, Ian (Harrow, E.) Mellor, Sir John
Cary, Sir Robert Heath, Edward Molson, A. H. E.
Channon, H. Hill, Dr. Charles (Luton) Morrison, John (Salisbury)
Clarke, Col. Ralph (East Grinstead) Hill, Mrs. E. (Wythenshawe) Mott-Radclyffe, C. E.
Clarke, Brig. Terence (Portsmouth, W.) Hinchingbrooke, Viscount Nabarro, G. D. N.
Cole, Norman Hirst, Geoffrey Nicolson, Nigel (Bournemouth, E.)
Colegate, W. A. Holland-Martin, C. J. Nield, Basil (Chester)
Conant, Maj. R. J. E. Hollis, M C. Nugent, G. R. H.
Craddock, Beresford (Spelthorne) Holt, A. F. Oakshott, H. D.
Cranborne, Viscount Hopkinson, Rt. Hon. Henry Odey, G. W.
Crookshank, Capt, Rt. Hon, H. F. C. Howard, Gerald (Cambridgeshire) Ormsby-Gore, Hon. W. D.
Crosthwaite-Eyre, Col. O. E. Howard, Greville (St. Ives) Orr-Ewing, Charles Ian (Hendon, N.)
Crouch, R. F. Hudson, Sir Austin (Lewisham, N.) Osborne, C.
Crowder, Petre (Ruislip-Northwood) Hudson, W. R. A. (Hull, N.) Partridge, E.
Pickcthorn, K. W. M. Smithers, Peter (Winchester) Turner, H. F. L.
Pitman, I. J. Smyth, Brig. J. G. (Norwood) Turton, R. H.
Powell, J. Enoch Spence, H. R. (Aberdeenshire, W.) Vane, W. M. F.
Price, Henry (Lewisham, W.) Spens, Sir Patrick (Kensington, S.) Vaughan-Morgan, J. K.
Raikes, H. V. Stanley, Capt. Hon. Richard Vosper, D. F.
Rayner, Brig. R. Stoddart-Scott, Col. M. Wakefield, Edward (Derbyshire, W.)
Redmayne, M. Stuart, Rt. Hon. James (Moray) Ward, Hon. George (Worcester)
Remnant, Hon. P. Summers, G. S. Waterhouse, Capt. Rt. Hon. C.
Renton, D. L. M. Taylor, Charles (Eastbourne) Webbe, Sir H. (London & Westminster)
Roberts, Peter (Heeley) Taylor, William (Bradford, N.) Wellwood, W.
Robertson, Sir David Teeling, W. While, Baker (Canterbury)
Ropner, Col. Sir Leonard Thomas, P. J. M. (Conway) Williams, Sir Herbert (Croydon, E.)
Ryder, Capt. R. E. D. Thompson, Kenneth (Walton) Wills, G.
Schofield, Lt.-Col. W. (Rochdale) Thompson, Lt.-Cdr. R. (Croydon, W.) Wilson, Geoffrey (Truro)
Scott, R. Donald Thornton-Kemsley, Col. C. N. Wood, Hon. R.
Scott-Miller, Cmdr. R. Tilney, John
Shepherd, William Touche, Sir Gordon TELLERS FOR THE NOES:
Mr. Drewe and Mr. Studholme.

Question put, and agreed to.