HL Deb 10 July 1918 vol 30 cc741-4

VISCOUNT CHAPLIN rose to ask His Majesty's Government the following Questions relating to the expenditure of the Ministry of Food, and the present cost of that Department to the State—

  1. 1. What has been the amount expended during the months of January, February, March, April, May, and June respectively. What has been approximately the total cost of that Department since the end of December, 1917.
  2. 2. What is the number of the staff employed at present, the amount of salaries which they receive, and what proportion of the whole cost to the State of the Ministry of Food is due to the distribution of food by a Government Department instead of by the ordinary channels previously used.
The noble Viscount said: My Lords, I do not rise for the purpose of raising any prolonged debate to-day, and the Questions which I have on the Paper are merely in continuation of Questions which I had begun to ask on February 19, but owing to the lamented illness of the late Controller and also owing to my own illness I was unable to pursue the inquiries which I was anxious to make at that time. I had ascertained what the expenditure of this Department was for the month of December, 1917, and as far as I recollect it was £48,000. The questions which I now rise to ask His Majesty's Government relate to the expenditure of the Ministry of Food and the present cost of that Department to the State, and are as follows. [The noble Viscount then read his two Questions on the Paper.] I am specially anxious to know what the cost of the last item may be because through the ordinary channels, of course, it costs the State nothing, and several times it has been asked on this side of the House, I think by Lord Selborne as well as by myself, and we have never got any answer that I remember, why prices could not have been fixed upon the retailer—we were speaking at that time of the prices which applied to meat alone—because everything then would have accommodated itself to the price obtainable when the article had reached the retailer. We were told at one time that it might lead to very considerable hardships if that practice were pursued. But my noble friend Lord Selborne pointed out a case of extreme hardship on one occasion with regard to the price of butter, in which there was an enormous discrepancy between the price given by a middleman, I think, and the person to whom the butter was transferred afterwards. That is the subject upon which I hope the Government may be able to give us some information to-day. I do not propose to say anything further, but merely to put the Questions which stand in my name.

THE LORD PRIVY SEAL (THE EARL OF CRAWFORD)

My Lords, the amounts expended by the Ministry of Food during the months mentioned by the noble Viscount are as follows—

1918. Administration. Purchase of Foodstuffs. Total.
£ £ £
January 99,231 16,767,651 16,866,882
February 193,873 23,428,329 23,622,202
March 230,142 30,572,188 30,802,330
April 188,872 36,022,250 36,211,122
May 137,649 39,849,466 39,987,115
June 334,490 37,361,127 37,695,617
1,184,257 184,001,011 185,185,268

The administrative expenditure is larger in March and June than in the other months because the expenses of Local Committees are met by quarterly payments made in those months; and also because in order to meet the convenience of the bankers the payment of monthly salaries, amounting to about £34,000, was made upon June 1 instead of May 31, a practice which will be continued in future months. These figures do not include the payments made by the Royal Commission on Wheat Supplies or the Royal Commission on the Sugar Supply. The number of the staff employed at June 30 was—At Headquarters, 5,183; Local Food Control Committees and Provincial Organisations, 6,750; total, 11,933. The annual amount of their salaries is approximately £1,730,000, being an average of £145 per head.

The distribution of food by the Department is worked conjointly with the general control of prices as fixed by the Food Controller's Orders and with the organisation for the maintenance of supplies. It is, therefore, impossible, to discriminate between the two items, and the cost of these functions cannot be separated. It is hoped that the cost of the Department will be met by the margin above cost price at which foodstuffs are sold to the consumer. These margins do not necessarily entail an additional charge upon the consumer since the control exercised by the Ministry of Food has, by the restriction of profits, by the economical use of transport, and by the elimination of the unnecessary middlemen, undoubtedly caused the pries of the articles controlled to be substantially lower than if they had not been controlled.

In this connection I may, perhaps, quote rom the Fourth Report of the Committee on National Expenditure— The policy adopted is that of equalising the price of a given commodity, wherever bought by the Ministry, and selling the whole of the resultant product at a flat cost price which includes freight, insurance, and all administrative expenses. The Select Committee of the House of Commons published in Appendix 1 of their Second Report a summary of the measures taken by the Ministry of Food to limit the profits derivable from all transactions and sales relating to essential foodstuffs. The approval of the Costing Branch is necessary before any Order relating to the determination of prices or profits is sanctioned, and the principle adopted is that prices are fixed on the basis of actual current costs of raw material plus the manufacturing costs and a reasonable profit based on pre-year rates.

VISCOUNT CHAPLIN

May I be allowed to ask one more question arising out of the answer? The noble Earl said that the method of purchase adopted by the Department will not cause any additional price to the consumer. He said nothing about the producer. What will be his position? Will it cause any less price to be given to him?

THE EARL OF CRAWFORD

It depends very much upon the product to which Lord Chaplin refers. In wheat, for instance, it would cause no difference whatever to him. On the other hand, it might cause a difference to the producer of oranges in Spain. Generally speaking, I think, what I have said covers the ground accurately—that the reduction of price effected by these Orders produces an economy to the consumer, and, in addition to that economy, keeps down the price generally, and if, as is hoped, the price which is fixed is not such as unduly to discourage the producer, the gain to the public as a whole must be large.