HC Deb 17 October 1972 vol 843 cc2-7
1. Mr. Ashley

asked the Minister of Agriculture, Fisheries and Food what has been the movement of food prices in the last three months; and if he will make a statement.

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

Between 16th May, 1972, and 22nd August, 1972, the latest date for which information is available, the food index rose by 3.6 per cent. But it should be noted that in August the prices of fresh fruit and some other imported foodstuffs reached abnormally high levels as a result of the dock strike.

Mr. Ashley

Although food trade representatives have paid lip service to the Government's proposals for a 5 per cent. limit on food price increases, is the Minister aware that they have also ominously said that it may not be possible to achieve this limit? In view of that ominous statement, does not the Minister feel that there is urgent need for strong Government action on food prices?

Mr. Prior

This was one of the matters discussed yesterday at Chequers. The CBI tabled proposals for voluntary arrangements to restrain retail price increases backed by a monitoring body on which the Government, the TUC and the CBI would all be represented. These proposals are to be considered further at the next meeting on 26th October.

Mr. Peart

Will the Minister now accept that his high-price food policy has failed? He deliberately went out of his way to increase food prices according to his declared policy, and Britain's entry into the EEC will inevitably mean a further rise. Will he now stop blaming the dockers and others since he himself deliberately increased prices?

Mr. Prior

No, and the right hon. Member for Workington (Mr. Peart) knows that what he has said is totally untrue. If he had been a good Minister of Agriculture he would have increased agricultural production, which would have enabled agriculture to have made a far greater contribution in the present world shortage of essential food supplies than is the case now.

14. Mr. Thomas Cox

asked the Minister of Agriculture, Fisheries and Food what has been the increase in food prices since March, 1972.

Mr. Prior

Between 21st March, 1972, and 22nd August, 1972, the latest date for which information is available, the food index rose by 3.8 per cent.

Mr. Cox

Can the Minister be in any doubt about the very deep anger of pensioners when they read that reply? Is he aware that it will confirm their worst fears that, because of his inability to control prices, the pension increase announced in March has now been totally eroded? Will he as a matter of urgency seek a meeting with the Secretary of State for Social Services and call for an immediate increase in the State retirement pension to ensure that retired people have enough money this winter to buy the kind of food that is so essential for their wellbeing?

Mr. Prior

I hope that the hon. Gentleman will join with the Government in persuading the country to adopt the Chequers measures, which will do more to help the old-age pensioners than anything else. Even apart from that, 11 million people receiving retirement pensions and other related benefits have received an increase in real purchasing power of the order of 5 per cent. as a result of the latest increase in pensions. This is a clear indication of our determination to look after those who suffer most in a time of inflation.

Mr. John Wells

On a point of order, Mr. Speaker. What happened to Question No. 10? Questions Nos. 9 and 11 were dealt with rapidly.

Mr. Speaker

Question No. 10 was answered with No. 7.

Dame Irene Ward

While I fully support the answer which my right hon. Friend has given, may I ask whether he has grasped the import of the Question which I have tabled to the Secretary of State for Social Services—which I tried to table to the Prime Minister—asking him to try to do something about heating, which is very important for those living on small fixed incomes? Is my right hon. Friend aware that I should very much welcome his support because he is such a delightful Minister?

Mr. Prior

I am always grateful for what my hon. Friend says, but I am not sure whether the last part of her question is entirely relevant to what she wants me to do. No one under-estimates or wants to play down the serious problems which old-age pensioners in particular suffer at a time of inflation. This is a feeling which the whole House shares and we must do all that we can.

Mr. Hooson

Has not the Minister consistently under-estimated the rise in food prices, and does not this have a great bearing on the Chequers package? Whether one is for or against the Common Market, is it not correct to say that in January the food index is bound to increase a great deal since, for example, the current price of lamb in the Common Market is nearly double the price in this country? Will not that have a devastating effect?

Mr. Prior

Increases which will come about as a result of joining the Community occur at the beginning of the farm year for the products in question—in April for dairy products and August for cereals. Lamb is a commodity which is outside the common agricultural policy at present, there being no regulation for it. Therefore, we are free to adjust our own lamb prices at this stage, and the lamb levy will not be introduced until 1st January, 1974.

15. Mr. Skinner

asked the Minister of Agriculture, Fisheries and Food what has been the percentage increase in food prices since June, 1970.

Mr. Prior

Between 16th June, 1970, and 22nd August, 1972, the latest date for which information is available, the food index rose by 21.7 per cent.

Mr. Skinner

And it has gone up a little bit more since then. Is the Minister aware that in that same period the food combines have increased their profits by more than 30 per cent.? Is there a connection between the two? Will the Minister now accept the Prime Minister's pronouncement that all his party should say "Yes" to everything and agree that there should be a complete embargo on all future increases in prices and profits in this sector?

Mr. Prior

I think that some of these matters are being discussed in the tripartite negotiations now taking place, and it would be better if I left it there.

Mr. Proudfoot

Does my right hon. Friend accept that the idea of a price freeze is totally wrong and that retailers throughout the country have been consistently reducing their margins over the past 25 years because of new methods? If Opposition Members bother to look at the margins earned in food, they will find that they are no greater than they were 10 years ago, five years ago or one month ago. There is no difference. I hope my right hon. Friend will point out that the freeze should be applied not to the retailers but to the manufacturers.

Mr. Prior

I think that my hon. Friend is right, but the increase in the prices of manufactured products has been just over 4 per cent. in the past year, showing that manufacturers have kept very strictly to the CBI initiative. Retailers have undertaken not to increase their gross profit margins over the next 12 months and, what is more, to pass on any improvements brought about as a result of the further initiative which is now being taken.

Mr. Buchan

Does not the right hon. Gentleman realise that the people are sick and tired of his failure to face up to his own responsibilities in this matter? Is he aware that after the staggering figure he has given us today he will go down in history as Mr. Twenty Per Cent., the first man in history to make a plate of mince cost more than roast chicken? That is the kind of problem he must face up to, and the Chequers talks will not answer it. There is very little wage content in the food price increases, which have come about because of his conscious desire and conscious policy.

Mr. Prior

What the country is saying quite plainly is that it is absolutely sick and tired of Labour Members backing every wage claim and every resort to wage increases yet at the same time crying crocodile tears over every price increase.

Mrs. Sally Oppenheim

Can my right hon. Friend say what proportion of the figure he has given represents convenience foods, in which there is a considerable element of rising labour costs?

Mr. Prior

I cannot give that figure offhand, but my hon. Friend will know that about half the increase in prices is clue to world price movements and between 30 per cent. and 40 per cent. of the other half is due to wage increases.

Mr. Jay

Is not the huge rise in prices exactly what we should expect from a Government which have deliberately put import levies on food in order to raise the prices?

Mr. Prior

If the right hon. Gentleman really knew his stuff, he would know that increases in world prices have been so great that the levies are not operating except in one or two exceptional circumstances.

20. Mr. Eadie

asked the Minister of Agriculture, Fisheries and Food if he is now in a position to make a statement on the increases in food prices arising out of the dockers' strike.

Mr. Prior

Supply problems caused by the dockers' strike temporarily increased the prices of some foodstuffs, notably some types of fresh fruit, but once the dispute ended supplies and prices quickly returned to normal.

Mr. Eadie

Since the right hon. Gentleman seems to be rather shy in giving the House some information, will he not confess that any price increase that does result from the dock strike could have been avoided if his Government had not by their blundering incompetence provoked that strike? Everyone knows that it should never have taken place.

Mr. Prior

I do not think that any but the most biased observer, which the hon. Gentleman obviously is, would agree with that statement.