Food Prices (Hansard, 22 November 1973)

§ 1. Mr. Ashton
asked the Minister of Agriculture, Fisheries and Food what has been the percentage increase in the price of bacon in the last 12 months, and the reason for its increase.

§ The Parliamentary Secretary to the Ministry of Agriculture, Fisheries and Food (Mrs. Peggy Fenner)
Since the percentage increase may be given only in terms of the various cuts and contains a number of figures, I will, with permission, circulate those in the OFFICIAL REPORT.
The reasons for the increases were the increased costs of pigmeat production caused by increased world prices for cereals and proteins and the competition bacon curers have met from other users of pigmeat in a strong world market for all meats.

§ Mr. Ashton
Has the Minister seen the report in the Sunday Telegraph, which stated that farmers are making approximately 50p profit on a pig weighing 1 cwt. and that supermarkets are making 13p profit on a pound of bacon? What action will she take to stop this practice, or must we all have rolls and coffee for breakfast, as in the Common Market?

§ Mrs. Fenner
A standing reference has now been made to the Price Commission to keep an eye on the whole range of fresh foods, and it is required to report to the Minister any details of the distribution margins on fresh foods which it wishes to draw to his attention.

§ Mr. Body
While my hon. Friend will be aware that the Commission, under Mr. George Thomson, has claimed that only 5 per cent. of the increase in the price of food can be attributed to our entry to the Common Market and to the imposition of levies, his figures can be only an average. Can my hon. Friend say what effect the levies have had upon the percentage increase in the price of bacon?

§ Mrs. Fenner
Bearing in mind that 80 per cent. of our bacon imports, which represent about half the bacon that we consume, comes from Denmark, and that the Danes are now receiving an EEC subsidy of £82 per ton, which is 20 per cent. more than the Danish national subsidies before 1st February 1973, my hon. Friend will see that the increases are due to the reasons I have given, which are world difficulties in regard to cereals and proteins, and are not attributable to the Common Market.

§ 4. Mr. Thomas Cox
asked the Minister of Agriculture, Fisheries and Food what has been the percentage increase in food prices since 1970.

§ 5. Mr. Carter
asked the Minister of Agriculture, Fisheries and Food by how much the cost of food has risen since 18th June 1970.

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

§ 28. Mr. William Price
asked the Minister of Agriculture, Fisheries and Food by what percentage food prices have risen since June 1970.

§ The Minister of Agriculture, Fisheries and Food (Mr. Joseph Godber)
Between 16th June 1970 and 16th October 1973, the latest date for which information is available, the food index rose by 44.8 per cent.

§ Mr. Cox
Is the right hon. Gentleman aware that those figures indicate the total collapse of any credibility for the Government's prices policy? Is he further aware that many families cannot afford to buy many items of food—and I do not mean luxury foods? As we are approaching Christmas, which is usually a time of heavy expense, will the right hon. Gentleman say what protection he can give housewives from the profiteering which evidence shows has already started?

§ Mr. Godber
If the hon. Member has evidence of profiteering I shall be happy to have it looked at immediately by the Price Commission. I agree that the level of price rises is most regrettable, but they have occurred for reasons the House knows perfectly well, namely the rise in world food prices. These rises have been even greater in other countries. As for the point about Christmas, I remind the hon. Member that the Government are providing a special bonus for pensioners.

§ Mr. Cox
You must be joking.

§ Mr. Godber
The hon. Member says we must be joking, but the Labour Government never provided such a bonus.

§ Mr. Carter
When will the right hon. Gentleman and the Government take food price rises seriously? In view of his remarks about the bonus for pensioners at Christmas, will he say that he wishes the £10 bonus to be increased to £20 in order to compensate for the grotesque price rises of the last 12 months?

§ Mr. Godber
I should certainly not wish to minimise for one moment the seriousness of food price increases, but when the Opposition make comments such as we have heard this afternoon it is time to remind the House that the purchasing power of each section of the community is higher today than when we took office in June 1970. [Interruption.] Those are the facts. I gave the figure 1528 for the food price increase, which is 44.8 per cent. The earnings increase is 47 per cent. and the pensions increase is 55 per cent. What is much more significant—and is the only true comparison—is the retail price index as a whole. This has risen by 32.5 per cent., which must be compared with the rises in earnings and pensions. If what we have done is bad, what the Labour Government did was infinitely worse.

§ Mr. John Wells
Will my right hon. Friend confirm my impression that the rise in price of home-produced food for consumption here is very much less, and will he confirm—I think I am right—that it is only 17.7 per cent. in the last year—[HON. MEMBERS: "Only?"]—and in particular that for British horticultural produce the rise has been very small?

§ Mr. Godber
My hon. Friend is correct. The price rises he mentions are very much lower. I do not have before me the figure he quoted but it is of that order. However, the true comparison is that world food prices in the period since we came to office have risen by no less than 77 per cent., which is twice as much as food prices in this country.

§ Mr. Skinner
When the right hon. Gentleman talks about the pensioners' purchasing power in 1970 or at any other date, is he not saying that, as is self-evident, pensioners' purchasing power has increased for several generations? However, does he not realise that one of the main reasons why food prices are rocketing concerns the returns we saw yesterday from Sainsbury's, for instance, of 18½ per cent.—a profit of nearly £7 million going into the well-lined pockets of the Sainsbury shareholders?
Is not one of the main reasons also reflected by the NFU survey, which shows that more than half the people in this country believe the Common Market swindle also to be responsible for the price situation?

§ Mr. Godber
First, on the specific point raised at the beginning of the hon. Member's question, it is clear that there has been a general rise in the standard of living of pensioners for many generations and I hope that it will continue. It is significant, however, that the rise is a great deal faster under a Conservative Government than under Labour. As for 1529 the profits of particular firms, the Price Commission has the right to look into all these matters and limitations are normally imposed by the code, which restricts the level of profits.

§ Sir Harmar Nicholls
Is my right hon. Friend aware that when he announced from the Dispatch Box two weeks ago that price increases under the Labour Government were among the highest we had had, the Opposition immediately excused that by blaming it on the Korean war? Is not this proof that world forces influence prices? Is the refusal of the Opposition to recognise that fact due to their typical political hypocrisy?

§ Mr. Godber
I must ask the Leader of the Opposition to answer that, but we can all draw our own conclusions. The electorate have drawn their conclusions in recent by-elections.

§ Mr. William Price
Is not that the most disgraceful set of answers given in the House for many years? Is it not apparent that, on the basis of the October figures, with the increase running at nearly 40 per cent. a year, the Government have thrown in the towel? Does not the Minister understand that for millions of families this Christmas will be a sad joke and that the over-fed Scrooges on the Government Front Bench are responsible?

§ Mr. Godber
When the hon. Gentleman says that Christmas will be a bad joke for those people, he is saying that when his own party was in power each Christmas was an even worse joke. It is impossible for him to claim that things are so bad now and ignore the conditions his party left for us to take over.

§ Mr. Ralph Howell
Is my right hon. Friend aware that we in this country spend only 19 per cent. of our income on food, the lowest percentage of any EEC country, and that the percentage is falling?

§ Mr. Godber
I cannot say without notice that the figure my hon. Friend gave is exactly right, but certainly the implications are very clear. We undoubtedly spend a lower proportion of our income on food. It has been gradually decreasing over the years and is now at the lowest point at which it has ever been.

§ Mr. David Clark
Does the Minister realise that people would be much more impressed if he tried to tackle the food problem instead of trying to make political points out of it? Does he agree that, in view of the massive percentage increases in food prices about which we have just heard, we shall find food prices in the early spring half as high again as they were when the Government took over? Does he realise that people are not impressed by his world food price argument in its entirety when we find that there are import duties and taxes on a variety of foods—beef, butter, cheese, bacon and cereals? It just does not add up.

§ Mr. Godber
I do not wish to comment on precisely where the price levels will go. It is very rare for any Minister to do so. But I have never hesitated to warn hon. Members, as I did the last time the matter was discussed, that there would be further rises. I have never tried to hide the situation from the public. If the hon. Gentleman encourages his hon. Friends not to seek to make political points, I shall promise not to make them, but when I am speaking to the public at large I give them the facts. I have given the House the facts today, and it is on those facts that people must judge.

§ 7. Mr. James Hamilton
asked the Minister of Agriculture, Fisheries and Food whether he will make immediate announcements about food price increases as they arise.

§ Mrs. Fenner
No, Sir.

§ Mr. Hamilton
Is the hon. Lady aware that the Government's clandestine approach in stopping the Price Commission making food price increases known to the electorate is causing grave dissatisfaction throughout the country? Does she agree that hon. Members are being placed in an impossible situation when they cannot communicate with their constituents about exorbitant price increases? How can we get in touch with the Minister to find out the situation, so that we may participate in the good government that the Prime Minister has told us about?

§ Mrs. Fenner
It is for the manufacturers to announce their price increases. 1531 It is the task of the Price Commission to restrict or reject such increases if they are inconsistent with the code. There is no need to duplicate the administrative task of making the announcement.

§ Mr. Wellbeloved
However frequently the hon. Lady's Department may seek to juggle with the figures, the plain fact is that for millions of less-well-off families there is now effective food rationing by price and that Britain faces becoming the worst-fed white nation in Western Europe.

§ Mrs. Fenner
The Question related to the announcements of price increases. I have answered it by saying that making the announcements is a task for the manufacturers.

Collar^*	55.5
Gammon^*	45.7
Middle Cut, smoked^*	43.0
Back, smoked	40.6
Back, unsmoked	42.0
Streaky, smoked	53.4
^* or Scottish equivalent.