HC Deb 20 May 1974 vol 874 cc26-7
27 . Mr. Giles Shaw

asked the Secretary of State for Prices and Consumer Protection if she will make a statement on the latest movements of the Food Price Index and the Index of Retail Prices

Mrs. Shirley Williams

Between 19th February and 19th March, the latest date for which information is available, the food index rose by 1.1 per cent. and the General Index of Retail Prices by 0.9 per cent.

Mr. Shaw

In view of what has occurred in the Budget in relation to taxation, particularly taxation of a large number of foodstuffs and the increased tax on beer, when does the right hon. Lady expect the threshold clause to be activated?

Mrs. Williams

We must wait and see. None of us can say yet. In response to reaction by the Opposition on the question of food subsidies, it should be made clear not only that they have a beneficial effect on the food index but that only the British consumers and no producers, either at home or abroad, benefit.

Mr. Biffen

Has the right hon. Lady's attention been drawn to the substantial leap in the Financial Times grocery index, reported today? As the Prime Minister has in the past made great play of this statistic, will she take this opportunity to underline his faith in its accuracy as regards the cost of living?

Mrs. Williams

The hon. Gentleman will be aware that the Financial Times grocery index is based on different brands, different lines and different qualities of foodstuffs. It is, therefore, in no sense a weighted index. As I tried to indicate to the hon. Member for Gloucester (Mrs. Oppenheim) in an earlier answer, the latest statistics show that the rise in the increase in the food index is slowing down and has been doing so for the past three months.

Mr. Graham

In considering the evidence concerning the food index, will my right hon. Friend take into account the index published in the Grocer last week which showed that for the second week in succession food prices had dropped by 0.5 per cent.?

Mrs. Williams

I thank my hon. Friend for that reminder. The Opposition's choice of statistics by the Grocer is somewhat selective, to say the least.

Mr. Channon

If the right hon. Lady will look at this week's index in the Grocer rather than last week's, she will see that the index has gone up and not down. How can she explain the increase in the Financial Times grocery prices index? If there is an increase in the index this month, does not the right hon. Lady accept that a great deal of that increase will be due to the taxation increases imposed by the Government while she tries to delude and fool the country that she is trying to bring prices down?

Mrs. Williams

The hon. Gentleman should be fair and point out that the effect of the subsidies to which the Opposition are totally opposed will be a net decline in the retail price index.

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