HC Deb 19 March 1952 vol 497 cc2492-510

12.2 a.m.

Mr. Frederick Wiley (Sunderland, North)

I beg to move, That an humble Address be presented to Her Majesty, praying that the Butter (Amendment) Order, 1952 (S.I., 1952, No. 271), dated 12th February 1952, a copy of which was laid before this House on 13th February, be annulled. I think it would be to the convenience of the House and expedite our business if we could have a general discussion of this and the following Orders that appear in the names of my right hon. and hon. Friends and myself, and then, if necessary, the Prayers could be put separately.

The purpose if this Order and the other Orders, which deal with bacon, cheese, sugar, oils and fats, imported canned fish, imported canned fruit, eggs and condensed milk, is to reduce the wholesale prices charged to the retailer and, generally speaking, leave the retail prices unchanged and so increase the profit margins to the grocers. As I have indicated, a large number of Orders is con- cerned, because they cover what is a substantial award to the grocers. In fact, when I questioned the Minister in the House he estimated the aggregate amount per annum concerned to be something in the nature of £10 million. That is an appreciable addition to the food subsidy total and, of course, it must eventually be passed on to the consumer in the form of increased prices.

I am sure that the House will agree that at any rate it merits close attention. The main basis of these increased margins is the Wages Council award to the employees in the retail food trade, which took effect on 18th July of last year. Following that award and following discussions with the spokesmen of the grocers, on 17th August of last year my right hon. Friend the Member for Bradford, Central (Mr. Webb), who was then Minister of Food, announced that he had agreed to increase the margins received by the grocers to take account of the recent wage increase I have mentioned and for other increased costs.

In fact, this award amounted to about £1,500,000. I would emphasise in paying regard to grocers' margins we have to pay regard to the global sum—the total aggregate sum received by them—and not the individual margins. The effect of this award—as was stated at the time—was to increase the amount of the grocers' profit margins by about £1,500,000. It is true at that time, on behalf of the independent grocers, Mr. Herman Kent said this was "far below the £10 million required to meet wage increases, advances in petrol, and paper costs." Nevertheless, the award was accepted at the time. The matter was regarded by my right hon. Friend and myself as being closed and settled.

I realise well enough that such an award deals with an extraordinarily difficult problem. When we deal with grocers we deal with the independent traders who have on average about 200 registrations each, and the multiple grocers and the co-operative societies who have, on the average, 1,200 registrations. To arrive at a decision on such a matter we have to examine a detailed mass of costing figures; we have to make what we regard as proper allowance for economies in the service; we have to pay attention, if it be the case, to the increased general profitability of the trade, and also to increased turnover, including the turnover of non-rationed commodities.

All these, and many other factors have to be taken into account, and then we have to try and adjust the margins to allow for changes in costs, and to provide the trader with a reasonable profit based—for this is the essence of the award—on his pre-war margins.

I would accept, in this context, what the Co-operative Party have said about the Ministry of Food, that the Ministry of Food has quite deliberately narrowed margins on foodstuffs. In general, the Co-operative Movement has supported the policy of the various Ministries in narrowing margins to keep prices down. Increases in wage costs, and other expenses have given increased urgency to the need for efficient distribution. The margins on foodstuffs particularly have been rigorously controlled. In all the circumstances, and in that way, we endeavoured to be as fair and scrupulous as we could, and we made effective this award of £1,500,000 by increasing the gap between the wholesale and retail prices on bacon and sugar, and we regarded the matter as closed.

This award of £1,500,000 was not an unsubstantial award. As a matter of fact, including the £1,500,000, the grocers have received an increase in margins, at the rate of £4 million a year since 1947, so that the award which was made, although I have indicated it did not completely satisfy the grocers, was, nevertheless, not one which in the light of experience of the past few years, could be regarded as unsubstantial. However, we got a new Minister of Food, and a new Government, pledged to economy, and pledged to cutting costs, and the grocers, no doubt apprehensive of the attitude of the Ministry, struck first.

They asked for the negotiations to be re-opened—that is, on the same basis of the wage increase in July, and the higher costs which they claimed they were incurring. Let me say at once, however presumably on further evidence tendered by the grocers, and the present Minister he awarded them a further £10 million a year. I am sure the House would agree that this demands some explanation from the Parliamentary Secretary.

Let me add, nevertheless, that I have no desire—I am sure no one has—for the grocers, either traders or employees, to be prejudiced because they are engaging in a trade which is very largely price controlled—although, in fact, the present Minister has shown a tendency to lessen the extent of the range of price control. Again, whatever arguments there may be about retail distribution, I for one would not believe it right to endeavour to change that structure of distribution through the instrument of the profit margin.

My simple case is that my right hon. Friend and I made what appeared to be a fair settlement in August and, without hearing the Parliamentary Secretary's explanation, I am not aware of any radical change of circumstances since then. The Board of Trade returns for 1951 show that the value of turnover in 1951 was 12 per cent. higher than in 1950. The latest returns of group trading profits that I have been able to obtain relating to the multiples do not indicate a fall in their profitability.

I give one or two examples which are typical. In 1949, Home and Colonial Stores made a trading profit of £1,685,000; in the following year, 1950, their profit is shown as £2,101,000. In 1949, the Maypole Dairy showed a profit of £352,000; in the following year they showed a profit of £528,000. In 1950, Cooper's Stores showed a profit of £265,000; in 1951 they showed a profit of £274,000. In 1950, Button's showed a profit of £109,000; in 1951, they showed a profit of £151,000.

I would emphasise that it is inevitable, in this system of margin fixing to look at facts in retrospect. It may be one of the disadvantages of the system. It may be that the prospect for the grocers if the present Minister remains in office is a grim one, and that they may not look with any confidence to an increased turnover this year. But as far as margins are concerned, we cannot make allowance for such factors until they are reached. The Parliamentary Secretary will have more up-to-date figures than we have got, but I am sure he will agree that we are obliged to examine this on a costings basis.

We do know, however, that at present, as a result of the Budget grocers will face heavy increased costs, particularly transport costs. We also know that at the moment the unions are negotiating for a substantial wage increase. We can only assume that grocers are now, quite properly, preparing to make a further and substantial claim for an increase in their margins. All this makes the award of £10 million the more surprising, because the Government apparently would be aware of what action they were considering in taking steps which might affect the grocers' costs. They were certainly aware that these wage negotiations were in progress.

Therefore, it is remarkable that the Minister should have made an award to the grocers at a rate £1½ million above that which the grocers themselves put their case in the summer when they made their representations to my right hon. Friend. In those circumstances, I am sure that the Parliamentary Secretary will accept that the burden is on him to show why he has made this award.

12.15 a.m.

Mr. Geoffrey Bing (Hornchurch)

I rise to second this Motion in only a few words. Those of my hon. Friends and myself who set down these nine Motions have thought that we should take them together in the hope that we should have a good discussion, not prolonged unduly, but nevertheless sufficient to cover the entire aspect of this matter.

I hope that the hon. Gentleman the Parliamentary Secretary to the Ministry of Food, now that he has heard the case put, will take an opportunity of dealing with these points. We have put the matter forward in an exploratory way. I know that many of my hon. Friends on this side of the House want to speak, but we do not want to keep the House unduly long. There may be hon. Gentlemen opposite who want to speak also. I hope, therefore, that the House will excuse me if I say no more than that I have great pleasure in supporting my hon. Friends, and I give way in the hope that the Parliamentary Secretary will now be in a position to say a word or two at the opening of this debate.

12.16 a.m.

Mr. W. R. A. Hudson (Hull, North)

I am glad to have an opportunity of saying a few words in this debate because it is a subject of which I have some direct practical knowledge. I do not intend, for the moment, to follow the hon. Member for Sunderland, North (Mr. F. Willey) although I shall have something to say a little later about the points he has raised.

I must, at the outset, make it perfectly clear that I have a direct interest in the matter. It is because of that direct interest that I am aware of the general basis of investigation and calculation to which the hon. Member for Sunderland, North, has just referred, and of which he had such great experience when he was Parliamentary Secretary to the Ministry of Food.

It so happens that the companies with which I am associated have for some years sent into the Ministry audited figures upon which, with other figures from other companies, they make their calculations. That brings me to the first point I want to emphasise, namely, that until the Minister of Food, and indeed the officials of the Ministry, have abundant proof that some increase in distributive margins is justified, they will never take any action at all, and the burden of proof is upon the trade and it is provided. But, having got that proof, that is not all. I am quite sure the hon. Gentleman will confirm—and, indeed, my hon. Friend the Parliamentary Secretary also will confirm—that after that it becomes necessary to deal with the matter at Treasury level to ascertain whether, in fact, the money is available and forthcoming. So that proof must be abundantly provided.

That brings me to the second point, which was also referred to by the hon. Member for Sunderland, North. There is invariably a considerable time lag between the period covered by the figures which are provided and the time when action can be taken, so that they are always out of date. And most of the figures that were quoted a moment ago were quite seriously out of date. Those that were more current were, it will be noted, not anything like as favourable as the earlier ones going back to 1949.

The fact is that the increased distributive margins—and I deliberately use that word instead of profit margins because there is a great difference—covered by the Orders which are now under review are already quite considerably out of date. The extra margins that have been granted to the retailer have, in many cases, been absorbed by increased wages which have, in fact, been granted by certain sections of the trade already. It is fair to say that these margins are no greater than the total expenses involved, and possibly are not so great. Let us remember that there are increased rates, for almost every local authority is striking a higher rate for the coming year than that which it had for the current year, and there are increased fuel and transport and lighting costs. The margins granted by no means cover all the extra costs incurred.

But there is one feature of this matter to which I direct the attention of the House, and that is that the retail grocery trade is almost the only trade in the country now which is bound to work on what is called the unit margin principle. It is the only trade which, since the beginning of the war, has not been allowed to take into account quite freely its increasing costs as those have mounted year by year.

It is, I think, correct to say, as the hon. Member for Sunderland, North, has said, that during the last four years increases have been granted to the amount of £4 million a year as a global amount; but I have been going into some figures and I find that the £10 million a year involved in these Orders, if worked out on a per capita basis, means that for each registered customer, an extra three farthings a week has been granted.

It is important to remember that that means the customer must be registered for the whole range of foods—cooking fats, cheese, butter, bacon, and eggs, and the retailer must be in a position to supply the canned fruit and canned fish and condensed milk, all of which are included in the global sum. Yet the retailer gets for each of his customers, three farthings a week.

Based on the calculations of the hon. Member for Sunderland, North, it means that during the last four years the retailer, at the £4 million a year rate, has got something less than an increase of a farthing a week, per customer, to cover all his extra costs; and I am sure that the House will realise that, not only can that sum not be considered excessive, but it is barely adequate. It was said a few moments ago that the global sum of £1,500,000 granted by the ex-Minister of Food, was accepted, but I think that that is a really dubious way of putting it. The retailer did not choose to accept it, and it was not accepted as being at all adequate; but it was felt that, sooner or later, this situation was bound to be reviewed, and that is what the Minister of Food has now done.

Having dealt with the matter on the basis of a per capita allowance on a distribution margin as distinct from a profit margin granted by these increased allowances I think the House will agree that we welcome this discussion because it will, I think, do away with a great many erroneous beliefs that are held about retail traders.

12.26 a.m.

Mr. R. E. Winterbottom (Sheffield, Brightside)

I do not propose to speak for long in this debate, but I think there are one or two things that ought to be said about these Orders. I am glad my hon. Friend the Member for Sunderland, North (Mr. Willey), has raised the central point at issue in this matter, which is to inquire why, after consideration last August, £1,500,000 was given to the grocers of the country and now another £10 million is being given? The latter sum is two and a half times the amount given from 1947. Some explanation should be given to clear the public's minds.

I recognise the difficulty facing the Ministry of Food. Grocers in this country have, for a long time, been among that section in distribution which has been making the smallest profits of all. One has to remember that we have a general economic problem and a growing problem of prices, but, nevertheless, one has to be fair in ascertaining what shall be allowed to grocers in terms of margins.

I should like to quote one or two figures about the margins in connection with the foods mentioned in the Orders. I think they are relevant, and I think the general public ought to know the difficulties which have faced grocers for a long time. Take butter. The gross profit on butter at the present moment, without the effect of these Orders, is 8 per cent. The gross profit on cheese is 5.1 per cent.; on margarine, 12.7 per cent.; on lard, 8.6 per cent.; on bulk sugar, either in one or 2 cwt. bags, 8.7 per cent.; pre-bagged sugar in cardboard cartons, 7.4 per cent.; imported fish and fruit, 9.4 per cent.; condensed milk, 8.7 per cent.

In terms of averages these are at least within the proved extensive expenses according to the costing division of the Ministry of Food. These come out at 9.6 per cent. I think it has been proved that the actual expenses given under these Orders in relation to the foods covered by them are, in terms of cost, much higher than the margins given to the grocer. I am a trade unionist, but I would not like to think that the Ministry of Food will not face the problems of a trade in this country that can only pay an adult worker £5 5s. 6d. a week. Therefore, in this problem, the relative value of the grocer to the general trade of the community must have a certain amount of consideration.

Mr. W. R. A. Hudson

The House ought to know that the figure which the hon. Member has quoted is the minimum rate and not necessarily the general rate which has been paid. I should not like the House to be misled in any way. In my speech I indicated that rates considerably in excess of that had been voluntarily agreed by a large section of the trade.

Mr. Winterbottom

I readily agree that as a result of independent negotiations, and sometimes on a voluntary basis, employers pay above the minimum rate, but the hon. Member will also realise that by far the majority of the workers in the grocery trade are paid according to Wages Council rates and that it is almost an exception for a trade union organiser to find employers paying above that rate, especially these days.

I detected in the hon. Member's speech a suggestion that the unit system was not filling the bill in the grocery trade, but I should not like to see the Ministry of Food pursue the same line as the Board of Trade and grant percentage increases to grocers. The hon. Member must agree that, by and large, until recently the unit system did a most useful job in keeping down the prices of commodities while giving a certain measure of justice to the employees and the employers. I know that that has been stretched recently; hence the reason for the £10 million grant.

Nevertheless, one has also to look at this from the point of view of the general public. In these days the main issue facing this Government—it would face any other Government—is the rising cost of living. Therefore, when it is broadcast to the general public that £10 million more has been paid to the grocers, it is wise that we should ask, through this Prayer, for a full explanation by the Ministry of Food.

As an old grocer, I hope that the Minister will keep the unit system going. At the same time, he should be fair to the people experiencing great difficulties in the section of distribution with the smallest margins of all, especially those who have done a first-class job in dealing with the country's most difficult problem, the rationing system.

12.31 a.m.

Mrs. Jean Mann (Coatbridge and Airdrie)

I have a vested interest in this subject. After having heard other hon. Members admit something of a vested interest, it is time that I admitted my interest in these Orders as a housewife. I hope I shall not be called to order by the Chair. One can only speak of what is contained in these Orders, but as the chief ingredient is trouble for the housewife, one could detain the House for about two hours on that.

This is part of the trouble which the Tory Government is placing on the shoulders of the housewives. Butter, bacon, cheese; sugar, oils and fats; canned fish, fruit, eggs, condensed milk; and the gap between the wholesale and the retail price is to be moved in favour of the grocers to give them a profit of £10 million, or a margin. Has there been any representation by the housewives about the size of their margins?—that is, if they have any margins at all.

Mr. W. R. A. Hudson

It has, I think, been indicated that the housewife, that is to say, the consumer, is not affected by these Orders. At this stage the Orders are merely serving to provide for the distributor adequate means with which to do his job. I would like your Ruling, Mr. Speaker, on whether the hon. Lady is in order in calling attention to an effect upon the consumer which cannot come about?

Mr. Speaker

That is hardly a point of order, though it may be a point of debate. I think that perhaps if the hon. Lady hears what is said she will be enabled to confine her remarks to what is strictly relevant.

Mrs. Mann

I think I mentioned that the amount was between the wholesaler and the retailer. But I hope that the hon. Member who has just sat down does not think for a moment that he is pulling the wool over the eyes of the housewife and that she does not know that, in the end, the indirect result is, first, to establish a higher margin of profit for the grocer and, second, to increase the price of all commodities for the housewife.

Sir William Darling (Edinburgh, South)

By three-farthings a week.

Mrs. Mann

Yes, by a farthing a week.

Sir W. Darling

Three-farthings.

Mrs. Mann

I wonder if the hon. Member will come to the women of Edinburgh and persuade them that all that it means is three-farthings a week.

An hon. Member has stated in this House that he was convinced that when the grocers came to put their case to the Minister he had to have abundant proof. I think that hon. Gentlemen must admit that experience in this respect, so far as the Labour Government was concerned, has been a very long one, and that experience so far as the present Government is concerned is very short. Therefore, the abundant proof that the Ministry demands really mostly relates to the experience of a Labour Government. It is admitted that under the Labour Government the hon. Gentleman's friends got £1,500,000, but in the very short months of a Tory Government, as against the very long years of a Labour Government, his friends have got £10 million.

Mr. Hudson

I am sure that the hon. Lady would not wish to mislead the House; but it was made clear, I think, even by the hon. Member for Sunderland, North (Mr. F. Willey) that when the last discussion took place the trade accepted it. I followed that by saying that while the trade may have accepted it, it did not accept it as adequate. The allowance which has recently been made did take account of a considerable lag between what was granted and what was due, which could be proved on the figures which had been given. I think it most unfair to suggest that the increased allowances which have been made have been given through the generosity of the present Government.

Mrs. Mann

The hon Member has just proved my case. He has admitted that he was displeased—or his friends were displeased—at getting only £1,250,000. I hope that we shall have no more of these juvenile interruptions while I am on my feet.

I want to ask the Minister what inquiry he made beyond listening to the plea of the grocers about the actual position. The statement we had about the grocer having only a farthing per week extra to cover his costs—on what basis is that plea made? Where has he found his farthing? Any housewife would tell the House that the grocer can find more than a farthing when weighing out cheese or any other commodity.

Any housewife will say that even through the Order which details the various cuts and rolls of bacon amounting to quite a number—fore ends, square shoulders, collars with blade bones and collars without blade bones—she is quite unable to detect whether she is being charged ld. or 2d. or 4d. too much on these cuts, because grocers today do not put the price label on their cuts as they used to do.

How many grocers are giving up their shops? The House had to pass a Measure very urgently to protect grocers in their shops—there were so many competing with the owner of the shop to get possession. We had to rush it through—and at any rate we did get it for Scotland. There used to be rows of empty shops. We used to have pleas from the property owners, who objected to paying rates on empty premises. The hon. Member for Edinburgh, South (Sir W. Darling), can remember that very well, because I believe he is almost as old as I am.

Sir W. Darling

I am too juvenile.

Mrs. Mann

I thought it was a weakness of my sex to pose as being younger than one really is.

I can remember the empty shops and there are now no longer empty shops. Did the Minister, in fixing this £10 million margin for the grocers, take cognisance of the variation in prices between, say, Co-operative stores and multiple stores? I know that the shop counter prices are the same, but at the Co-operative with which I deal I get back 1s. 8d. in the £. To the ordinary customer it is called a dividend, but I know there are shop Co-operative stewards who get 2s. in the £. I believe in London it is very much less. Did the hon. Gentleman ask how it comes about that the Co-operative stores can give this dividend, say, in Scotland, where freight is bound to be heavier than around London, while others are complaining that they have not got sufficient profit margin?

I see in these Orders a great deal of trouble for the housewife. The precedent is established that in one go £10 million can be handed out to the grocers in extra profits and I am sure that the plea that it is coming from the wholesaler will not go down with the housewife. In many cases, the wholesaler is also his own retailer. I view it with very great alarm and I hope that the Prayers against the Orders will be carried to a division tonight.

12.46 a.m.

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

The hon. Gentleman the Member for Sunderland, North (Mr. F. Willey), moved his Motion with moderation. He made clear, it seems to me, that there is no dispute at all as to the responsibility of the Minister, in relation to price-controlled goods, to achieve reasonable returns at the different levels of handling in the trade.

I believe he would accept this from me, that in the days of the right hon. Gentleman the Member for Bradford, Central (Mr. Webb), as in the days of his predecessor, there was in the mind of the Minister of the day—and I know he will not expect me to elaborate it in detail—a level of post-war remuneration which was regarded as appropriate for the grocery trade. That level had a relation to the pre-war figures.

The first point I want to make is that my right hon. and gallant Friend the Minister of Food is seeking to sustain the same level that the right hon. Gentleman opposite and his colleagues sought to sustain and the same level that the right hon. Gentleman's predecessor sought to sustain. So the objective, if a level may be so expressed, of post-war remuneration is not disputed between us.

Mrs. Mann

rose—

Dr. Hill

If the hon. Lady will allow me to develop the answer, I believe she may even be inclined to modify the view she has expressed.

The hon. Member for Sunderland, North, related the circumstances of last year and I accept his description of them. In the summer, an application was made by the grocers on the basis of certain factors, including the wage award of 18th July, 1951, for an increase in margins, and the hon. Member's right hon. Friend made such changes as would achieve an increase in margins of £1½ million. But his right hon. Friend did something more than that. He instructed his officers to investigate the up-to-date position. Following that September increase, the officers of the Ministry—the right hon. Gentleman opposite knows of the skilled financial staff of the Ministry, who are employed on this work—made an investigation on the basis of the trading returns of establishments of different kinds.

What is new in the situation—new to the hon. Member for Sunderland, North—is, in fact, what the officers of the Ministry found, as the result of the inquiry they began on the instructions of the right hon. Gentleman the Member for Bradford, Central. They found there had been a substantial reduction in takings in the summer of 1951. They found that the wage award, to which the hon. Gentleman has referred, played a part. They found, too, a substantial increase in costs, including, of course, in costs of wrapping paper.

Mr. F. Willey

I am sorry to interrupt. I am entirely in the hands of the hon. Gentleman on the point of cost, but on the point of takings I mentioned the Board of Trade returns, which show increased turnover, over the year, of 12 per cent.

Dr. Hill

As the hon. Gentleman will appreciate, I am giving the findings of the Minister's financial advisers and investigators into the position in the latter part of last year. It is reported that in that part of the year there was a substantial fall in earnings.

Mr. Willey

There may be a difference between the Minister's investigators and the Board of Trade, but this should be cleared up, because the Board of Trade returns for December, again, show that, as compared with 12 months before, there was a rather larger increase in the value of the turnover.

Dr. Hill

There is a difference between those returns of turnover and the findings of this investigation into net earnings. Furthermore, while the investigation was proceeding the import cuts announced by my right hon. Friend the Chancellor of the Exchequer, at the end of last year, became a further worsening factor. The hon. Member will understand my difficulty in stating the figures in all their detail, and the embarrassment that would involve; but I think I can help the House if I say that what was found was that the earnings of grocers generally would have been little more than half what they were before the war. They would have fallen to that low level had nothing been done.

When one takes into account a reasonable percentage increment to reach a proper level of post-war earnings, one will see that the deficiency revealed was surprising—indeed, alarming. The deficiency revealed was more than twice the £10 million which my right hon. and gallant Friend finally decided was a fair award. My right hon. and gallant Friend is not concerned with the whole of the deficiency. As the hon. Gentleman himself pointed out, only some 60 per cent. of grocers' takings are in respect of price-controlled goods; but even so, making allowance for that factor, making allowance for the £1½ million which had already been given, and making allowance for certain other factors, my right hon. and gallant Friend reached the conclusion that the least that he could properly and decently give was £10 million, in order to remedy a situation dangerous to the people of this country. The small grocers' shops play a tremendously important part in the distribution of food.

My right hon. and gallant Friend might have rejected the report and done nothing about it. He might himself have decided on some level of earnings; but in his view, having discovered that alarming position, he was not entitled to expect grocers to subsidise the rest of the community; grocers and grocers' wives are entitled to proper remuneration. Facts unknown to the right hon. Member for Bradford, Central—because he was not in office when the work was completed—and unknown to the hon. Gentleman who moved this Prayer, led my right hon. and gallant Friend to decide that the least sum that was reasonable and decent was £10 million. As the hon. Gentleman has said, these Orders are the avenue, as it were, through which the bulk of that £10 million finds its way to the retailers.

I will confine myself to the principle, as did the hon. Gentleman. Having discovered that the level of earnings, taking the import cuts into account, would have been little more than half the pre-war level, my right hon. and gallant Friend did the only reasonable and decent thing, and made this award. I ask the hon. Member for Sunderland, North, to consider whether, in the light of the additional information that I have given him, he does not feel able to withdraw his Motion. To annul the Orders would be inconsistent with the standards of remuneration which the right hon. Gentleman opposite himself sought to achieve, and to have done less than my right hon. and gallant Friend has done on the information before him would have been grossly unfair to a section of the community which does a great deal of unpaid work for the Government in working the rationing system, a section to which my right hon. and gallant Friend is greatly indebted, and one which is worthy of a little more praise than it has had in the past.

12.56 a.m.

Mr. Maurice Webb (Bradford, Central)

I do not propose to detain the House very long, but in view of the speech which the hon. Gentleman has just made it would be improper of me, in view of past responsibility, not to say a word. We are all agreed that the grocers of this country have rendered very great service, and that we are in their debt for the way in which they maintained the integrity and stability of our rationing system in war and in the post-war years.

It is agreed, too, that they have done it on margins which were not lavish, not margins which led them into wild expenditure of public money. But against that, in judging the value of any particular adjustment of their margins, we have to consider certain other factors. We have to consider that the grocers have had a greater security under the rationing system than they had in pre-war years that rationing has, in fact, been a guarantee to them of continuing trade. There have been, as has been pointed out, fewer bankruptcies, and there is no lack of people ready to go into the market and buy grocers' shops as they become available.

These factors have to be taken into account because we are discussing public money. Quite apart from the technicalities, whether it goes to the wholesalers or retailers, in the end it is either borne by the housewives or on the subsidy. In the end, because of the cutting down of the food subsidies by the Chancellor, the present Minister of Food will have to impose another £10 million on the prices of certain commodities, and that is what these Orders are about.

That is the simple arithmetic of it. The question is: How far were they entitled to this degree of increase? I agree straight away that they were entitled to some degree of increase. The inquiry, about which the hon. Gentleman spoke, was not a new inquiry started by me. I do not want to claim credit for something I did not do. it is, in fact, a continuing process of the existing investigations of the Ministry.

Dr. Hill

May I clarify that point? As the hon. Member for Sunderland, North (Mr. F. Willey) said earlier, routine inquiries are in respect of the previous year, and are out of date by the time their fruits are available. What the right hon. Gentleman did was to institute a current up-to-date inquiry into the prevailing position. I hope he will not deny the credit for that.

Mr. Webb

I want to get at the truth of the matter. It is not a large point, but I want to get the facts accurate.

There is a continuing process of inquiry into the costing of the grocers' margins all the year round. That is a very valuable element in our Ministry of Food administration. It is true that when I was Minister I was not satisfied with the amount we were able to give them in the way of increased margins last year, and I urged the Ministry to look again at their problem to see what could be done against the background of their increased costs. I have not the latest information which is available to the Minister, but I have some later information. I had information right up to the middle of October, and, adding that up, I am frankly astonished that the Minister has found it possible to make an arrangement of this order.

When I first heard, privately, that the figure he was going to grant to the grocers was £10 million I said spontaneously, "That is ridiculous," because on my calculation, taking account of all I felt they were entitled to, I thought £10 million was going far beyond what was reasonable, bearing in mind that at this time the Chancellor is asking other sections of the community to tighten their belts, to do without, to make some sacrifice, that we are living beyond our means, and all that kind of economic argument that is used.

We are tightening our economy, and this seems to me to be an inappropriate moment for making an extension of this order. When I learned that the Minister was prepared to go to the extent of £10 million I thought he was being quite reckless, and that something like £5 million or £6 million would be reasonable, proper and adequate, and in the circumstances would be a proper adjustment and, on the whole, satisfactory for the grocers.

The trouble is that, when we talk about these things in this global way we are doing an injustice to certain sections of the trade. I wish we could separate the multiple grocers from the small family grocer. I think that even on this figure the small family grocer will not find things easy. Certainly, the large multiple grocers will find things much easier, and rather easier than I think they ought to at this time. However, we cannot make that distinction; the Minister must settle the thing on that global basis. In my view, he has been unduly and unnecessarily generous in making this concession. But there it is. We on this side of the House are agreed that some concession ought to be made; we are not disposed to quarrel with that. That is the figure that has been arrived at, and we want to make our protest against the size of the figure. I advise my hon. Friend to leave it there, having made our protest, and to withdraw his Motion.

Mr. F. Willey

The Parliamentary Secretary has extended to me an invitation to withdraw this Motion, which I should like to accept, but not on the grounds on which he invited me to do so. I think that in matters like this it is very dangerous to make allowances for future import cuts. I have emphasised that we should really regard these matters in retrospect on a purely costing basis, and I was alarmed to learn that there was an element connected with future import cuts. I emphasise "future" because these cuts have not yet affected retail distribution at the time of the award. I say no more than that, because I do not want to transgress the rules of order.

I willingly accept the Parliamentary Secretary's invitation, but on these grounds. This was a collective agreement, reached no doubt after prolonged negotiation, and I think that it would be wrong for the House lightly to upset that agreement. However, I hope that the Parliamentary Secretary will, following the useful debate we have had, pay proper attention to these matters and endeavour to check up on the information upon which he acts—although I am not casting doubt upon it—by making inquiries in a wide range of fields. I could not, for example, accept that the grocers are half as well off as they were before the war. In the circumstances, I beg to ask leave to withdraw the Motion.

Motion, by leave, withdrawn.

Mr. Speaker

As the discussion on that Order ranged over all the Orders in respect of which Prayers had been put down, the hon. Gentleman will not, I take it, desire to move the remaining Motions.

Mr. Willey

That is correct, Mr. Speaker. In view of the general discussion, I have no desire to move the remaining Motions.