HC Deb 12 April 1973 vol 854 cc1496-8
19. Mr. Golding

asked the Minister of Agriculture, Fisheries and Food whether he will establish an inquiry into increases in the price of meals in works canteens since 1st April 1973.

Mrs. Fenner

No, Sir. My right hon. Friend sees no justification for such an inquiry.

Mr. Golding

Earlier, the Minister of Agriculture told us that there was no tax on food. Is the Parliamentary Secretary aware of the alarming increases which have taken place in the price of canteen dinners throughout the country despite the claimed reductions in the price of old potatoes, carrots, onions and cabbages? Will she say what she intends to do about this? If she will do nothing herself, will she ask employers to accept the burden of this new tax as it affects workers' dinners?

Mrs. Fenner

As the hon. Member knows, VAT is chargeable on food served for consumption on the premises.

Mr. William Hamilton

It is a tax on food.

Mrs. Fenner

Such food was already subject to selective employment tax. During the prices standstill restaurants and canteens are allowed to increase prices to recover the additional cost of raw materials. My prices unit has been investigating a number of complaints about canteens received before 1st April. We have not found that the managers of canteens have been in breach of the terms of the standstill. It is a bit too soon to assess the complaints that have arisen since 1st April.

Mr. Tom King

As most works canteens are subsidised by the employers, will my hon. Friend confirm that there is nothing in the terms of phase 2 to prevent union negotiators from negotiating more favourable subsidies for their members?

Mrs. Fenner

I am sure the hon. Gentleman will be aware that this is possible.

Mr. Buchan

What the Minister has demonstrated is that the freeze applies successfully to wages and everything else except workers' costs. Does she not agree that since the freeze of workers' wages started the annual rate of increase in the cost of food has been about 23.4 per cent.—double that of 12 months ago? Can she tell us of any period in recorded history when food prices were rising so alarmingly?

Mrs. Fenner

The Question referred to VAT on food served for consumption in works canteens. VAT was imposed from 1st April, and as from 1st April wages may be increased within the limits laid down in the stage 2 arrangements.

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