Food Prices

HC Deb 18 April 1972 vol 835 cc202-9

1. Sir G. Nabarro

asked the Minister of Agriculture, Fisheries and Food what increase in food prices occurred during the twenty months ended 31st March, 1972, or the latest convenient date.

4. Mr. Carter

asked the Minister of Agriculture, Fisheries and Food by how much food has risen in price since 18th June, 1970.

17. Mrs. Renée Short

asked the Minister of Agriculture, Fisheries and Food by what percentage food prices have risen since June, 1970, to the latest convenient date.

The Minister of Agriculture, Fisheries and Food (Mr. James Prior)

I refer my hon. Friend and the hon. Members to the reply I gave to the hon. Member for West Ham, North (Mr. Arthur Lewis) on 11th April.—[Vol. 834, c. 171.]

Sir G. Nabarro

That reply indicated an approximate increase in food prices over the period indicated in my Question of about 16 per cent., which was grievous. Will my right hon. Friend give us an absolutely unequivocal undertaking that he and all his Cabinet colleagues are resisting to the utmost the demands for excessive wage increases as in the case of the coal miners and railwaymen?

Mr. Prior

Wage increases have a great deal to do with rises in the cost of living. I can give my hon. Friend the assurance for which he asks.

Mr. Carter

Contrary to the drivel of the hon. Member for Worcestershire, South (Sir G. Nabarro), does the Minister accept that much of the acrimony in the present dispute in the railway industry is directly attributable to the outrageous level of price increases in the food sector over the past 18 months and, in particular, the cynical disregard by the Government of their election pledges to cut prices at a stroke?

Mr. Prior

The hon. Gentleman should not make outrageous statements which bear no relation to the truth. The railway workers have had an increase far in excess of any increase in the cost of living. Since last July the increase in the cost of living has been running at a rate about half that of the increase of the previous 12 months. That is true of the Food Index, too. The one thing that can destroy all our hopes for stable prices is if wage increases run totally out of line with either increases in the cost of living or increases in production.

Mrs. Short

There are large areas of poverty in this country for which the Government appear to have no regard. Apart from pensioners, there is an enormous number of people who work a full working week and who get very little more than the subsistence level of pay. Some of these happen to be railwaymen. Is the right hon. Gentleman aware that railway workers in my constituency who do a full working week and give up their Sundays and free time take home less than£15 per week? If he is talking about stable prices, why does he not take steps to control the price of food?

Mr. Prior

The hon. Lady is wrong——

Mrs. Short

I am not wrong!

Mr. Prior

The average earnings of railwaymen are£28 a week. There is not a single man in the railways earning less than£20 per week. There are sections of poverty in this country, and the best thing that all hon. Members can do for them is to keep down excessive wage claims so that we can help those who need help.

Mr. Evelyn King

Does my right hon. Friend agree that a considerable degree of responsibility for increased food prices rests not only on those who seek inflationary wage settlements but on hon. Members of the Opposition who so irresponsibly support them?

Mr. Prior

I agree with my hon. Friend. Hon. Members opposite spend a great deal of time complaining about increases in the cost of living and then a great deal of time supporting excessive wage claims.

Mr. Buchan

Will the Minister pay a little more attention to his responsibility as the Minister for Agriculture instead of as spokesman and Deputy Chairman of the Tory Party? He has the position completely the wrong way round. One of the reasons for demanding wage increases is the Minister's inertia in trying to control the rapidly rising price of food.

Mr. Prior

The hon. Member knows that that is nonsense. Since the CBI initiative last July, the cost of living has been increasing at about 5 per cent. per year and yet wage claims are being awarded or asked for at the rate of 14, 16 or 20 per cent. a year. They bear no relation to the cost of living. We must all realise that this is not serving the interests of the nation in any way whatsoever.

2. Mr. Dixon

asked the Minister of Agriculture, Fisheries and Food what is his latest assessment of the likely increase in British food prices following entry into the Common Market in view of the greater rise in international food prices compared with Common Market food prices.

18. Mr. Ewing

asked the Minister of Agriculture, Fisheries and Food what estimate he has now made of the increase in British food prices consequent upon Great Britain joining the European Economic Community, in the light of the most recent assessment of the European Economic Community Commission.

Mr. Prior

The latest estimate which takes account of changes in world prices of certain commodities (notably milk products) and the farm price increases recently agreed by the Community is that accession to the EEC will result in an increase in retail food prices in the United Kingdom of about 2 per cent. per annum over a period of about six years.

Mr. Dixon

Does my right hon. Friend agree that any rise in food prices as a result of Britain joining the Common Market will have nothing to do with the relationship between British food prices and European food prices but rather between international food prices and the Common Market food prices? We have virtually no control over international food prices, but from next year, as a major consumer, we shall have enormous control over Common Market food prices.

Mr. Prior

I do not think there is any doubt that it is recognised by the Community that from next year we shall be exerting a very considerable control over food price increases within the Community. But at the moment we have no control over world food prices to which we are subjected, and it is these prices which have been rising most rapidly.

Mr. Ewing

The British housewife is certainly not convinced by the type of answer the Minister has given today. She does not believe that prices will increase by only 2 per cent. as a result of joining the Common Market. In a recent publication called "Burdens and Benefits of Farm Support Policies" the authors make it quite clear that the burdens of joining the Common Market will fall most on the lower paid and will create more poverty than exists now.

Mr. Prior

I accept that it is on the lower-paid members of the community that increases in the price of food fall most harshly. This is fully accepted in the Government's White Paper which we published before the debate in the House of Commons. I can give all hon. Members the assurance that the Government are determined to see that where an increase falls most harshly, the assistance, whether through social benefits or other methods, should help them in that respect.

3. Mr. Skinner

asked the Minister of Agriculture, Fisheries and Food what has been the increase in food prices between February, 1971 and February, 1972.

Mr. Prior

Between 16th February, 1971, and 22nd February, 1972, the Food Index rose by 11.9 per cent.

Mr. Skinner

Is the Minister aware that these figures, coupled with the figures which he gave for the period since the Government took office, represent an extra£3 per week on the average train driver's family food bill? Is this what the Tory Government mean by blackmail?

Mr. Prior

I am also aware that in the last month the action I have taken has reduced the average weekly food bill of the family by 20p.

Mr. Farr

Can my right hon. Friend say what effect the reduction he made in the price of milk and the other actions he has taken in the last month have had upon the cost of living?

Mr. Prior

When it comes through in the index, which will not be until the 1st April figures are published, it will amount to about 3 points or 2 per cent.

7. Mr. Meacher

asked the Minister of Agriculture, Fisheries and Food if he will now introduce measures to control food prices for lower-paid workers.

Mr. Prior

The National Food Survey shows that households where the earner is in the lowest range of income have, in general, maintained their expenditure on food in real terms in recent years. But where any of this group are in need and dependent on social benefits, the Government prefer to adjust these benefits to maintain their value rather than impose controls.

Mr. Meacher

Is the Minister aware that the Trade Policy Research Centre recently calculated that food costs for families in poverty would increase by£33 a year when we were in the Common Market? Is he aware that they show that under the CAP British households with less than£36 a week, the great bulk of working-class households, will have to pay an extra£500 million in farm support costs, whereas at present they pay only£67 million? What is he doing to stop this sell-out of the poor?

Mr. Prior

I have read the statement by the Trade Policy Research Centre. We have already recognised that the increase in food prices generally will bear heaviest on the low-income groups. That is why in the White Paper we gave firm assurances that any increase in the cost of living resulting from entry into the EEC will be fully taken into account in the reviews we make, and we shall be making a review each year both of pensions and of family income supplement

Mr. Ridsdale

Is not one of the best ways of helping the lower-paid workers to restrain wage demands, as many of the demands for increases ahead of productivity increases are causing unemployment?

Mr. Prior

I agree very much with my hon. Friend, and I would go one stage further. The other thing we need to do is to give everyone in this country a chance to earn more—and I mean earn more. A combination of those two things would do more to help the lower-income groups than anything else.

Mr. Elystan Morgan

Is the right hon. Gentleman aware that by a cruel irony the factor of low income per head coincides in many areas with a higher-than-average price of food? I am referring particularly to areas such as Mid-Wales and the South-West of England. Is the right hon. Gentleman prepared to have a thorough and rigorous survey made of this factor, and is he willing in principle to agree that there should be a strict control of prices, particularly in those areas?

Mr. Prior

I do not agree with the latter part of the hon. Gentleman's question, but I shall study very carefully what he said in the former part. I would point out to him that by a cruel irony it was in the period of the last Government that the low-income groups suffered most.

12. Mr. William Price

asked the Minister for Agriculture, Fisheries and Food by what percentage food prices have risen in the last six months.

Mr. Prior

Between 17th August, 1971, and 22nd February, 1972, the Food Index rose by 4.5 per cent.

Mr. Price

Does not that figure prove that the Minister's forecasts of a substantial slowing down in the spiral of price increases have been worthless and that his recent so-called reductions are nothing more or less than a thoroughly sick joke? In view of the disastrous performance we have had from him on a full-time basis, what hope for us is there from him on a part-time basis?

Mr. Prior

On the contrary, the figures prove exactly the opposite to what the hon. Gentleman claims. They prove that the food price increases are slowing down very considerably. I know that right hon. and hon. Members opposite will be pleased to hear that for the next few months the prospects are even better—that is, of course, provided that we do not price ourselves out of the market again by increased wages bearing no relation to productivity.

Sir G. Nabarro

Has not my right hon. Friend observed the descending progression of the 16 per cent. increase which he gave in reply to me, the 11 per cent. increase which he gave in reply to the hon. Member for Bolsover (Mr. Skinner) and now the 4 per cent. which he gave in reply to the hon. Member for Rugby (Mr. William Price)? Is not this a descending progression?

Mr. Prior

In fairness, the figures relate to different periods of time. But for all that, they are considerably better, and I notice the gay expressions of right hon. and hon. Members opposite.

Mr. Buchan

The right hon. Gentleman must also recognise that he is dealing with a seasonal position. The 4.5 per cent. increase is serious and alarming, especially when weighed against the promise that prices would be cut at a stroke.

Mr. Prior

The hon. Gentleman knows very well that we never talked about prices being cut at a stroke. When he talks about the seasonal position, he should remember that the best part of the season is yet to come.

13. Mr. Duffy

asked the Minister of Agriculture, Fisheries and Food how wholesale food prices moved in the first quarter of 1972, compared with the last quarter of 1971.

Mr. Prior

Between September and December, 1971, the wholesale price index for the products of the food manufacturing industries rose by 1.3 per cent., whereas between December, 1971, and March, 1972, provisional results show a fall of 0.3 per cent.

Mr. Duffy

Will the right hon. Gentleman then explain why this has not already been reflected in food prices for the housewife?

Mr. Prior

It has been reflected in prices for the housewife, but the cost-of-food index always runs about six weeks behind. Before putting down another Question about that, the hon. Gentleman should consult his hon. Friend the Member for Rugby (Mr. William Price).