Food Subsidies

HC Deb 12 April 1976 vol 909 cc891-2

6. Mr. Peter Bottomley

asked the Secretary of State for Prices and Consumer Protection what estimate she has made of the saving per week, for a single person, as a result of the present level of food subsidies.

Mr. Maclennan

The average saving for for a single person living alone is estimated to be about 24p per week.

Mr. Bottomley

How temporary are the subsidies?

Mr. Maclennan

The programme for the future of subsidies has been set out in the Public Expenditure White Paper with a carefully-considered timeable for their reduction.

Mr. Gwilym Roberts

Would not my hon. Friend agree that it is now widely recognised on this side of the House that the food subsidies have had an important redistributive effect in helping the lower-paid sections of society? In those circumstances, would he ask our right hon. Friend to use her now much greater weight within the Cabinet to ensure some change in any policy which is aimed at cutting out these subsidies?

Mr. Maclennan

My hon. Friend is right to stress the redistributive benefit of food subsidies, although it is true that in the long run, if one wishes to achieve that end, it may be better to act directly through taxation and the social security system. But I am sympathetic to his view of the importance which should be attached to the future of the food subsidy programme. The proposals for the future represent, I believe, the fastest possible rundown.

Mr. Norman Lamont

With reference to subsidised bread, does not the increase of lp on a standard 17p loaf mean that the price of bread has increased by 6 per cent. and that not even a subsidy has enabled it to remain within the Price Check Scheme? It is now outside.

Mr. Maclennan

The increase in the price of bread is due simply to a straight increase in the price of flour. The increase is not, however, 6 per cent., as the hon. Gentleman said. The Price Check Scheme permits a rounding up to the nearest coin in common use.

Mrs. Dunwoody

What estimate has my hon. Friend made of the increase in subsidies needed to keep pace with the price increases which will be brought about as the direct result of the CAP price review?

Mr. Maclennan

The Government's view is that it is appropriate to adhere to the general policy of relying increasingly upon social security benefits to meet the cost of inflation. My hon. Friend will be aware that last week the Secretary of State for Social Services announced the fourth such increase in the two years since this Government took office.

Mr. Lawrence

Further to the suggestion by the hon. Member for Cannock (Mr. Roberts), would the hon. Gentleman confirm or deny that it is this Government's policy to use food subsidies for the purpose of redistributing wealth?

Mr. Maclennan

The policy of food subsidies is redistributive; that is one of its merits and attractions to us.