§ 20. Miss Burtonasked the Minister of Food whether he is aware that gross profits of the tea trade show an increase of £16,500,000 on the first 10 months of 1954, as compared with the whole of 1953;that the public views with disquiet the suggested price increases; and if he will, therefore, investigate the position in the tea industry at the present time as a prelude to price control.
§ The Parliamentary Secretary to the Ministry of Food (Dr. Charles Hill)I would refer the hon. Member to the reply given to her on 27th January by my hon. Friend the Economic Secretary to the Treasury.
§ Miss BurtonIs the Parliamentary Secretary aware that people are amazed at the way in which this Government does nothing but cover up the way in which increased prices are demanded from consumers, whether for tea or any other goods? Might I ask the hon. Gentleman if he has seen the statement in "The Times" today, where the Prime Minister of Ceylon, although he withdraws part of his statement, still says that
… there seems to be too great a gap between Ceylon auction prices and the price paid by the consumer.Are the Government going to do anything about that matter?
§ Dr. HillI shall be dealing with that last statement made by the hon. Lady in reply to Question No. 44. On her main point, in fairness, I think she would wish to state that the £16 million to which she refers were not distributed. The amount distributed by the 176 companies in dividend after deduction of tax was less than £3 million. It is true that large profits have been made recently by the tea companies, but they can argue that they do little more than offset the trading losses of the past two or three years. [HON. MEMBERS: "Oh."] They are not my words. They are from the "Socialist Commentary" for February.
§ Mr. McAddenIs my hon. Friend aware that the co-operative societies advertise themselves as the largest growers and distributors of tea in the world? If that advertisement of theirs is correct, will he address a particular appeal to them to give a lead in this matter and to bring down the price of tea?
§ Mr. FollickOn a point of order. That was a mis-statement. Brooke Bond are the biggest.
§ Miss BurtonFurther to that point of order. With respect, might I ask you, Mr. Speaker, if I can inform the hon. Member opposite——
§ Mr. SpeakerIt is quite open to the hon. Lady to inform the hon. Member 13 for Southend, East (Mr. McAdden) of anything she likes, but she should send him a letter.
22. Mr. H. Wilsonasked the Minister of Food if he will state the stocks of tea in this country in November, 1952, 1953, and 1954. respectively.
§ Dr. HillStocks in London and provincial warehouses at the end of November, 1952,1953 and 1954, were about 111 million lbs., 98 million lbs. and 69 million lbs., respectively. In addition, in November, 1954, there were some 16 million lbs. diverted during the dock strike, awaiting transhipment to this country from Continental warehouses.
§ Mr. AlbuDo not these figures show that in fact the Government fiddled the price of tea before they derationed it by building up stocks in this country in order to be able to show an immediate fall in price, and that part of the reason for the present prices is that the tea gardens
§ Mr. NabarroOn a point of Order. Are you aware, Mr. Speaker, that the hon. Member for Edmonton (Mr. Albu) referred to my right hon. and hon. Friends in an extremely opprobious fashion. If I heard him rightly, Sir, he called my hon. Friend a "fiddle." Is it in order to accuse my right hon. and hon. Friends of a manoeuvre of that kind?
§ Mr. SpeakerThe poet said that tea was a cup which cheered but did not inebriate, but it seems to be producing a certain amount of excitement here.
§ 31. Mr. Willeyasked the Minister of Food whether, in view of the further increases in the price of tea, he will now introduce price controls.
§ 32 and 35. Mr. Jayasked the Minister of Food (1) whether he will now restore price control on tea;
(2) if he will now restore the subsidy on tea in order to cover the present excessive cost to the consumer.
§ 40. Mr. E. Fletcherasked the Minister of Food if he will take steps to reduce the cost of tea.
§ 41. Lieut.-Colonel Liptonasked the Minister of Food whether he will now control the price of tea.
§ 43. Mr. Lewisasked the Minister of Food what action he now proposes to take, by price control or subsidy, to reduce the price of tea and thus assist in implementing the Government's declared policy of reducing the cost of living generally and food prices in particular.
§ Dr. HillTea is sold in the world's markets at prices determined by international demand in relation to supply. Effective Government action to reduce prices in these conditions would require a compulsory limitation of demand, which is rationing.
§ Mr. WilleyIs the Parliamentary Secretary aware that, in spite of the considerable demand which was put upon supplies in the 6½ years of the Labour Government, the price of tea increased by only 8d. a lb.,whereas already under this Government, when greater supplies are available, the price has increased by nearly 4s. a lb.? Surely the Parliamentary Secretary should bestir himself and do something about it?
§ Dr. HillThere are two points which I should like to make in reply to the hon. Member. First, the consumption of tea per head of the population today is higher by half an ounce than it was under rationing, and higher by one-tenth of an ounce than it was before the war.
There is no sure way of bringing down the price of tea without the introduction of subsidies which, in turn, mean rationing"—which is, again, a quotation from the "Socialist Commentary" for February.
§ Mr. JayIs the Parliamentary Secretary aware that the Parliamentary Secretary to the Ministry of Health, in a Conservative broadcast, said:
Tea was the first thing to come off the ration, and what has happened? There is plenty for everyone, and at reasonable prices?Does he agree with that?
§ Mr. GodberCan my hon. Friend give any reason why the previous Government chose to abandon bulk purchases of tea?
§ Mr. JayWill the Parliamentary Secretary answer my question? Does he regard the present price of tea—as his hon. Friend regarded it—as reasonable?
§ Dr. HillI want to see the price of tea come down, but those who advocate price control as a way of bringing it down must bear in mind that it would mean price control plus subsidy, plus rationing, in order to reduce it at the present time.
§ Mr. Langford-HoltIs my hon. Friend aware that probably the best way to bring down the price of tea is to stop drinking it, as I have?
§ Mr. T. ReidCan the Parliamentary Secretary say why the Government did not take steps to make a long-term contract when it was obvious to everyone—as announced by me, amongst others—that there would be a huge rise in the price of tea? Why did the Government not make a bulk buying contract at that time?
§ Dr. HillThe hon. Member will recall that bulk buying was ended because of the fall in the quality of tea under that arrangement—and it was ended by the previous Government, in April, 1951.
§ Mr. SpeakerWas the answer to Question No. 31 intended to include the answer to other Questions? If so, will the hon. Member indicate which Questions he wished to include?
§ Dr. HillYes, Mr. Speaker. I must apologise for not making the statement that, with permission, I would answer Questions No. 31, 32, 35, 40, 41 and 43 together.
§ Mr. JayCan the Parliamentary Secretary say whether he regards the present tea situation as an example of the doctrine that Conservative freedom works?
§ Dr. HillThe present situation in tea is due to demand being in excess of supply, and the one remedy for that situation is a balancing of supply and demand.
§ Mr. JayIf the Parliamentary Secretary controls the price of bread, as I understand he now does, what is his objection to controlling the price of tea?
§ Mr. LewisIs the Minister aware that I have been asked to convey to him, on behalf of many thousands of old-age pensioners, the fact that they cannot now afford tea, not even the limited ration which there was when there was a shortage of supplies? Will he therefore do 16 something now to see that at least the old-age pensioners, and those people living on lower incomes, receive a minimum ration, such as that which they were in the habit of receiving during the worst period of the war? Will he not at least do something, perhaps by way of coupons for tea, to help these people?
§ Dr. HillIt is a fact that, although the increased price of tea is far from welcome, the consumption of tea by old-age pensioners has not fallen.
§ Mr. JayHas not the Parliamentary Secretary got it upside down? If the demand for tea is in excess of the supply, whereas the demand for bread is not, is not that an argument for controlling the price of tea, rather than the price of bread?
§ Dr. HillThat illustrates the fact that bread is subsidised and tea is not, and to subsidise tea would involve a return to rationing.
§ Lieut.-Colonel LiptonIs the Parliamentary Secretary telling the old-age pensioners and others who cannot afford to buy tea at the present time that all he can say to them is that the law of supply and demand must operate? Is he willing to be regarded as the most horrible Parliamentary Secretary to the Ministry of Food which this country has ever seen?
§ Mr. J. R. H. HutchisonCan my hon. Friend say how much of the increase in the price of tea is due to increases in export duties by the producer countries?
§ Dr. HillI want to make this clear, because it is important; I was going to make it clear in a later answer. The London buyer of tea pays roughly, given equivalent quality, the same amount for his tea whether he buys it in London, Colombo or Calcutta, and the existence of an export duty does not of itself increase the amount that he pays.
§ Mr. FletcherAs the Parliamentary Secretary has said that he wants to see the price of tea reduced, will he at least tell us, in that matter, whether he had any discussions with the Prime Minister of Ceylon, who regards the price of tea in this country as scandalous?
§ Dr. HillThere is another Question on the Order Paper on the precise point concerning the Prime Minister of Ceylon, and I will answer it when it is reached.
§ Later—
§ Mr. JayAre we to have no answer to Question No. 35,which is on quite a different subject to the previous Questions?
§ Mr. SpeakerI understood that it was answered with Question No. 31.
§ Mr. GaitskellFurther to that point of order. Since the Parliamentary Secretary failed to inform the House that he was taking these two Questions with the first Question which he answered, is it not in order for him to answer a supplementary question on No. 35?
§ Mr. SpeakerThere was some confusion at the time, and I confess that I understood that the Parliamentary Secretary was answering Question No. 35 with others. Am I right about that?
§ Dr. HillIf it would help the right hon. Gentleman the Member for Batter-sea, North (Mr. Jay), I will gladly give him the answer, which is "No, Sir."
§ Mr. JayMay I ask the hon. Gentleman if he is aware that, when the previous Minister of Food announced the removal of the subsidy from tea, he said that the trade had undertaken that blends of sound quality would be available at 3s. 8d. per lb. and in sufficient quantities to meet any foreseeable demand. Does the hon. Gentleman not think now that that was misleading the House and the country?
§ Dr. HillThat was a statement in regard to the circumstances of the time. None could anticipate the substantial increase in the consumption of tea in India and Ceylon, as well as in the United States of America, and it is this increased consumption which is largely responsible for the present situation.
§ Mr. JayDoes it not mean that what the Minister was really saying was that the price would be 3s. 8d. per lb. for a few weeks and would then go up to 8s.?
§ Miss BurtonOn a point of order. As I did not get an answer to my Question No. 20, will you allow me, Mr. Speaker, to ask a supplementary question now?
§ Mr. SpeakerNo; I am afraid we must pass on.
§ 33. Mr. G. Jegerasked the Minister of Food whether he will consult the New 18 Zealand Government for information and advice on the administrative machinery by which they have imposed a controlled price for tea without controlling supplies, so as to follow their example here.
§ Dr. HillI would refer the hon. Member to the reply given to the hon. Member for Dundee, East (Mr. G. M. Thomson) on 7th February.
§ Mr. JegerIs the hon. Gentleman aware that I have already referred to that answer, which told us precisely nothing? Does the Parliamentary Secretary now say that, as far as the price of tea is concerned, he cannot cope with it and does not care?
§ Dr. HillThe New Zealand system, to which the hon. Gentleman refers, is one of freezing the price on a date in January—I believe 25th or 26th January—with a maximum of 8s. 6d. retail, and provides that traders can go to a tribunal for an increased price on the ground of increased costs. I am bound to say to the hon. Gentleman that, if that method were adopted here, bearing in mind that the packers of tea are losing money at the present time, it might well result in an increase in the retail price of tea.
§ Mr. WilleyWill the hon. Gentleman consult representatives of both New Zealand and Australia and also have a look at imposing a retail price stop, which would stop any further increases until there had been discussion with the various traders?
§ Dr. HillWe have had consultations, but we have not reached the conclusion which the hon. Gentleman has reached.
44. Mr. I. O. Thomasasked the Minister of Food what discussions he has had with Sir John Kotelawala, Prime Minister of Ceylon, during his recent visit to this country, on the price of tea imported here from Ceylon; and if he will endeavour to make arrangements for such tea to be purchased direct from Ceylon by his Department with a view to reducing the retail prices of tea.
Mr. ThomasIs the Minister aware that, in relation to the present price of tea, his present colleague the Parliamentary Secretary to the Ministry of Health 19 stated on 16th May, 1953,on behalf of her party that tea would be the first thing to come off the ration and that there was plenty of tea for everyone at a reasonable price? Can the Minister explain why, since his Government came into power, the price of tea has risen seven times, from 3s. 8d. to 7s. or 8s. per lb.? In view of these facts, what is the Minister going to do about it?
Mr. ThomasIn view of the fact that the Minister has given an evasive reply, may I repeat my question?