§ LORD BEAVERBROOK had given Notice that he would call attention to the high remuneration paid to the big combines for the distribution of milk compared with the lower remuneration paid to the independent dairyman, and move for Papers. The noble Lord said: My Lords, my object in raising this Motion to-day is to get more production and, of course, more production is a war measure. At present more production is frustrated in some directions by impediments, by injustices, and by abuses in the agricultural industry. My hope s that before long sufficient milk for our requirements will be produced in Great Britain, but if that condition is to be brought to pass we 1066 must, first of all, wipe out a real injustice that exists in the milk industry. That injustice has been very slightly modified by a new price list issued on April 1 and my remarks to-day will be confined to that price list. For convenience I will also deal, if I may, with London prices only instead of with country ones. Country prices vary, so I will devote myself to London prices in order to make my argument clear.
§ I am very glad to be appealing to the noble Lord the Minister of Food because he has made an immense success of his job. I think it is just three years to a day since the country was happy enough to get his services. He has been the most splendid Minister. Not one word will I say in criticism of him, even when I think he is wrong. I will, however, say something in criticism of milk prices. I may say, I hope without giving offence to the agricultural members of your Lordships' House, that the Government are the sole buyers and sellers of milk. Every distributor must buy from the Government, so that the Government are the sole sellers of milk. The Government have at least three prices for those who wish to purchase milk. First, there is the price for the co-operative societies, the United Dairies and such-like buyers. That price is 2s. 0¼d. per gallon. Then there is the wholesaler-retailer of 750 gallons, and his price is 2s. 1d. Thirdly, there is the producer-retailer, and his price is 2s. 1½d. I hope I have got those prices correct on the new scale of prices.
§ Here, then, you have three prices for milk. Does the consumer get a better service on account of the three prices? Not at all. The retailers all deliver at the same price; they all ask for 3s. a gallon when the milk is delivered. Let us say that three milk carts leave one street, they set out from three establishments in the same street. One milk cart belongs to the co-operative society or the United Dairies, another to a wholesaler-retailer and the third to a producer-retailer. The wholesaler-retailer has the advantage of a halfpenny, and the co-operative society and the United Dairies have the advantage of 1¼d., over the little man. The cooperative society, along with the United Dairies, comes first, the wholesaler-retailer comes next, and the producer-retailer is on the ground floor, as it were, or perhaps he could better be described as being in the cellar. The wholesaler-retailer dealing 1067 with more than 750 gallons gets a higher profit than the producer-retailer, who is in effect a wholesaler, who never deals with more than about 500 gallons in a day. There is no case so far as I know of one dealing with more than 500 gallons.
§ So the consumer gets no better service from any one of these three vendors all of whom are on a different basis of profit, all of whom are given a varying basis of remuneration by reason of the fact that they are allowed to buy their milk at varying prices from the Government. And do the Government get any better service? No. The Government are the only market and therefore discrimination neither benefits nor injures the Government's sales. We might put up with this injustice if there were no evil consequences from it, but there are very serious consequences. The producer-retailer, being at a disadvantage, may try to get a bigger turnover, but he cannot succeed. It is impossible for him to do so. The result is that he is compelled to do business on the basis that his rival has a better price. The rule in business which refers to a big turnover and a small margin of profit is reversed, and the effect is that a big turnover is allowed to have a bigger margin of profit.
§ Mr. Harold Green, a producer-retailer, with a maximum of 500 gallons or less, carrying on business near Coventry, finds that no increase of his milk round is possible. He does everything the big combine does in the way of processing and bottling and even pasteurisation, and he has to pay the Government 2s. 1½d. The Coventry Co-operative Society selling alongside him pays only 2s. 0¼d. That is quite an injustice. What is the result? The producer-retailer is tempted to sell out. He is tempted to help to promote a monopoly. The result of his selling out is that his business is taken over by the co-operative society. The sign over the door is not changed; it remains the same. The milk carts continue to bear the same label. The employees remain the same. The new owner of the business, however, buys at 1¼d. a gallon cheaper from the Government on account of having made a purchase of a little man's business, that little man having, perhaps, been squeezed to the wall by reason of the fact that he was not able to get the same benefit and advantage from the purchase of milk from the Government as is available to the 1068 co-operative societies and the United Dairies.
§ My noble friend Lord Perry has compiled a very considerable Report on these subjects. I hope very much to have some support from him to-day because he is, perhaps, one of the most distinguished farmers in the community. He is looked upon as a manufacturer, but really he is of the soil. Now there are 80,000 of these producer-retailers, of whom I have been speaking, in the country, and there are only 1,000 monsters. And the 1,000 monsters do as much business as the whole 80,000 producer-retailers put together. That is due of course to the mounting business of the monsters, to the discrimination of which I have been speaking. It is bound to continue as long as the monsters have this benefit over the producer-retailer in the purchase of milk and, of course, the producer-retailer is being gradually absorbed by the monsters. That process must continue as long as the monster has this immense advantage in the matter of buying milk. Just think of it 1,000 Ahabs to 80,000 Naboths—eighty Naboths for every Ahab. I do not know whether Elijah will heave in sight. We have not seen anything of him as yet.
§ Then there is also the menace on account of this system—to my way of thinking the most serious menace—that these combines, the wholesale co-operative societies and United Dairies and so on, when they do get control of the milk marketing business of the country, will be regarded as a monopoly. As soon as they are regarded as a monopoly then, at once, according to the recent brilliant broadcast of the Prime Minister, to which Lord Bledisloe has referred, the Government are going to take control. So perhaps the day is not far distant when the Government will take control of the milk distributing industry. I am sorry that the Leader of the Socialist Party in the House is not here to-day. I had hoped that he would have taken part in this debate, but I suppose he is in Buckinghamshire. When the Government take control of the milk distributing industry it means that we shall have to take our babies' milk from the bureaucrats, and that is not a very pleasant prospect. I can tell your Lordships that you cannot milk a cow by a committee, not even by Lord Addison's committee in Buckinghamshire with its eleven members, for a 1069 cow has only got four teats. It cannot be done by committees.
§ I think I have male out a case proving the existence of this absolute inequality in favour of the monsters. What is the answer of the Government to all this? I know the answer of the Government. The Government will say that the Co-operative Wholesale Society and United Dairies are collecting the milk from the farms and providing depots, and therefore they should be permitted to purchase milk at an advantage of 1¼d. per gallon over their competitors. But the producer-retailer renders exactly the same service; there is no difference at all between the service rendered by tae combine and that of lie producer-retailer; yet the combine pays the Government 2s. 0¼d. and the producer-retailer pays 2s. ½d. That is the answer when the Government say that the combines render services that are worth something to the Government: the same services are rendered by the producer-retailers.
§ We are told about railway rebates. These railway rebates existed before my noble friend the Minister of Food took office. The system is a bad one. It will be said by the Government that these rebates are in part responsible for the cheaper price to United Dairies and others; but these rebates were given on account of long hauls. These long hauls are no longer necessary. The Government are the only vendors now, and should be able to eliminate these long hauls altogether. In any case, the railway rebate was always less: than the spread which now exists between the price paid by United Dairies and that paid by the producer-retailer, a spread which is to the advantage of United Dairies. It is therefore an act of fiscal justice to give the same rate to the small buyer as to the large one—or even a better rate. It might be a good idea to give a better rate, because it ought to be cheaper for the big buyer to distribute than it is for the small purchaser to do so, and therefore something might be done to help the small man.
§ This system—if I may say so with due regard for the splendid work of my noble friend the Minister of Food, who has saved the State vast sums of money—is a waste of public money. There is an unnecessary payment to the co-operative societies and to United Dairies. My noble friend has 1070 already made some reduction in that payment, but now is the time and this is the opportunity to make a further reduction, wiping out the inequality, with advantage to the State. Monopoly always depends upon cheap production and more economical distribution. United Dairies and these other combines should be able to achieve more economical distribution because of their size. I recommend my noble friend, therefore, to despoil these monopolies and to reduce their compensation still further. I know that he made a change in prices a couple of days ago which will save us £2,750,000, and that was well done; but there is more to be done. An enormous advance can still be made. If this money is saved, the proper use for it, of course, is to increase production. That is where the money should be spent. Production can be stepped up. How can we do it? We can do it by re-seeding the enormous acreage to be re-seeded, and by building silos. Silos do not cost much money. There is plenty of opportunity for the increased production of milk, perhaps wiping out many of our imports of cheese and butter, by re-seeding and by silos. There is plenty of margin for the sale of increased production for manufacturing processes.
§ There is a most distinguished Committee of noble Lords in this House, eleven in number—the usual size of a committee. They want to increase milk production by 65 per cent. over pre-war, which means 40 per cent. above the present level, and they say that it can be done. I agree with their desire to increase milk production, and I agree that we might go so far as to have an increase of a million calves. That is what they say. I should be satisfied with something less than a million, but they want a million calves, in round figures. That is a fine ambition. But I regret to tell you that they also want to have about a million committees to look after the million calves, and that is where I part company with them. So far as cows are concerned, I think their ideas are fine; about the committees, I do not feel the same. They speak of the cows and their followers. I always thought their followers were calves, but now I find that their followers are committees.
§ I am striving for total agricultural production in our community according to our needs, an agricultural production to fulfil our necessities. I have striven after 1071 it for many years, for which I take no credit; but who now denies that agricultural production to the extent of our necessities is a possibility in Great Britain, and not only a possibility but within the bounds of our capacity, if only we will take the necessary steps? Where could we begin with better advantage than by increasing now the production of milk? We want to increase the total production not only of milk but of other agricultural produce necessary for our food and for our feeding-stuffs. That would be a very big help. Limitation of output is a big blow to us. On the one hand, production in plenty is a big help to us; on the other hand, limitation is a big blow to us. We are told by the Minister that our stocks of food are declining, and that makes increased production all the more necessary. Increased production fits in with the war doctrine and strategy of our Government. It will help us to release ships now engaged in carrying foodstuffs to our country, and free them to carry soldiers, and that is a pressing necessity. It will do away with the risks run by our food ships in crossing the Atlantic; they will no longer be exposed to the submarine menace on the North Atlantic route, and that will be an advantage.
§ In this way we shall escape the U-boat peril, if we go forward to production in plenty for our own purposes in Great Britain. If we cannot go the whole way with every foodstuff, let us at least do it with milk products. The U-boat is now the greatest of all the menaces to us. The Germans expect to reach a conclusion through their U-boat campaign. We know that they will do nothing of the sort; none the less, they do expect to reach a conclusion through that campaign. In a sense it is an unequal battle, because the U-boat is small and the target is big. The U-boat can withdraw from the battlefield of the waters, but the target must remain. The curve of sinkings has moved upwards over the last four years. Even if we make allowance for the months of comparative repose, none the less if the four years of war are divided into periods it has been said by our Ministers that the curve is always upward, so that the U-boat has become at this time the priority in all our decisions. Now it is the Battle of the Banks of Newfoundland, just as it used to be the Battle of Britain. We are told by the First Lord of the Admiralty that the 1072 available tonnage has been increased by 2,000,000 tons in the last several months, but none the less we are warned by every Minister on every occasion, "Beware of the U-boat menaceߪ" Victory by sea, as in the air, is now essential, we are told over and over again. That victory can be hastened if we can make this country self-sufficient in food, and we can send no more deadly message to the enemy than to say, "We can grow our own food." For by this means we will divert ships for the purpose of carrying troops to fight the enemy on the battlefield, where we can most certainly destroy him. I beg to move.
§ LORD PERRYMy Lords, I should like to support my noble friend Lord Beaverbrook, particularly in his criticisms in regard to milk, on which subject I have a little detailed and special knowledge. There is no doubt that the margin paid to the distributors of milk for distribution is exorbitantly high. There is no doubt that recommendations have been made to the Minister which, if acted upon, would have considerably reduced that margin. Your Lordships may remember that the Minister in refusing those suggestions said—and figures, of course, can be contorted in very many ways—that the recommendations for economy were so insignificant that they only amounted to 4d. per house-hold per week. That, of course, may sound very insignificant, but the aggregate of it per annum is £12,500,000. That is an economy which could have been effected by an equitable adjustment of those margins of which my noble friend Lord Beaverbrook is complaining. It certainly is a rule of business that the large producer gets better terms than the smaller producer—and, by the way, it is my first experience of a Government Department paying any attention to rules of business—but in the case of a monopoly like milk there is no possible excuse for paying a big distributor a larger margin of profit than a smaller one. As Lord Beaverbrook very properly said, if a difference has to be made it should be made in favour of the smaller man, who has a less turnover.
However, be that as it may, the margins now existing are approximately such that the public pays for milk twice as much as the producer receives. There is a business problem which should at once attract the attention of anyone seeking to effect economy. I am sure there is no 1073 staple food distributed in this country to-day which employs only one middleman, as is the case with milk. Milk goes straight from the producer to the consumer, through one middle-man only, carrying a loading for gross profit of 100 per cent. It is quite an anomaly; it sticks out as a business anomaly like a sore thumb, and should be corrected. No attempt has been made to correct it. On the contrary, as Lord Beaverbrook pointed out, the big man has been given the bigger margin and the small man a less margin. But there is something else which is very much more evil than that—evil to the social well-being of the State. Following a conception of control invented and conceived before the outbreak of war, and long before the fathers of this conception had any practical knowledge of the problem, it was desired to register every consumer of a foodstuff and marry him up to a distributor. That has been a consistent policy in respect of all rationed foods. At the present moment every consumer, with one exception, is married up to some monopolist distributor. The exception is tea, and that is a glorious exception, if I may say so.
It is not only that the small man is getting less profit under this scheme of milk margins, but he is being frozen out of business, because now the Ministry of Food tell all of us where we may get our milk. We must go to this, that or the other distributor, and of course they do mot allocate customers to every distributor. They have tried to rationalize, and they have succeeded, of course, in monopolizing. The consequence is that the actual distributors go and spend money in advertising for registered customers, and m[...]k has to be bought now from some monopolist—a licensed person created a monopolist by the Ministry of Food. That is a worse evil than the difference in prices, because under that system you will gradually arid by evolution create one big monopoly. If you do we may find ourselves, as the Prime Minister said, in the position that the State has to take over and control monopoly and we should then look to the State for our milk supply. I want to underline that, if I may. There are to-day very many thousands of men who, three or four years ago, were getting an honest living by hard work in distributing milk. By tic arbitrary action of the Ministry of Food their living has 1074 been taken away from them; their customers have been taken away and handed over, generally speaking, to large distributors and monopolists.
§ THE MINISTER OF FOOD (LORD WOOLTON)I am sure the noble Lord would not make a misstatement purposely. I hope he will distinguish between taking a person's living away and removing his customers.
§ LORD PERRYI am so sorry. I am not quick enough in the uptake to distinguish between the two.
§ LORD WOOLTONYou might find yourself in the happy position of getting a living without doing any work for it.
§ LORD PERRYAgain I am so sorry—perhaps it is because I lack the advantage of the Government mind, but I do not sec that. I think it was Shylock who said:
. . you take my lifeWhen you do take the means whereby Ilive.That, I think, is the answer. The customers have been taken away, as the noble Lord admits. The customers bought milk from which the distributor made a profit. If you take away a man's customers, he gets no profit, he gets no living, so his living is taken from him. That is what I tried to say to your Lordships. The real point I wanted to make is that this system of licensing tradesmen, and then proceeding because of war emergency conditions to marry up to him customers who must come and get their supplies from him whether they will or not, is wrong. The Ministry of Food has been guilty of many misdemeanours. For example, it killed years of very useful work by the Ministry of Agriculture in establishing the National Mark. It is now proceeding to take out of the milk business all proper competition, hand it to a monopoly, and then tell the consumer not only that he must buy his milk from a particular tradesman, but that he can only get the sort of milk Which that properly nominated tradesman sells.I have received letters from fathers of families who have been very much concerned because formerly they bought pasteurized milk and brought up their families on it. What happens now, and did not happen until the Government laid unholy hands on the control of milk? You 1075 may not buy the type of milk that you want. It continues to be produced—that is to say, T.T. milk continues to be produced. I happen to own a farm myself, where I always say we have got all the embroideries that we can possibly have for milk production. I get a premium for this, that, and the other thing, totalling altogether 3¼d. per gallon over the normal price, because it is clean milk. What happens to it in the hands of the Ministry of Food? My clean milk, produced under the most ideal conditions, in premises that are continually inspected, is taken and tipped into a common pot together with all the dirty milk produced by less competent people. I am paid a premium by Government authority to produce clean milk, and when I have done so the milk is, as I say, taken and tipped into a common pot with the worst and dirtiest milk possible. That, again, seems a piece of bad management. It is an outrage on the consumer because he is told he must go to a tradesman who cannot sell him the goods that he wants, and there is no provision made to protect the consumer in that regard.
I would like, if I may, to quote something that occurred to me while Lord Beaverbrook was speaking. I am certainly not second to the noble Lord in expressing my personal admiration for the Minister of Food as a man. I am afraid I have to forgive him for a lot that I would put down to the fact that he is a victim of his environment. There have been the anomalies created by the Ministry of Food, not merely the doing away with the National Mark, but the doing away now, in the milk question, with all the very hardly-won conditions which have been built up by the Ministry of Agriculture in the production of clean milk. They have paid premiums, as I have mentioned; they still continue to pay premiums; but all that work is being undone. We are going backward in the production of decent clean milk and the last state of affairs is very much worse than the first.
For example, the noble Lord is very concerned, and properly concerned, that school children shall have milk in the schools. Before the war private enterprise, at the instigation of the Government, supplied milk in schools to 56 per cent. of all the school children in the 1076 country, and the Government only had what might be regarded almost as a token payment. But the Ministry of Food has put into cold storage the Milk Marketing Board, whose members are no longer consulted. Before the war the milk in schools was distributed by the Milk Marketing Board, and the producer paid out of his own pocket .29d.—little more than ¼d. per gallon—on all the milk sold in the country, and that went to pay for the milk consumed by the children in the schools. It was a contribution very willingly made by the milk producers. Even those rather maligned distributors, instead of demanding their full pound of flesh, which was about 11d. per gallon for distribution, actually distributed that milk for 7d. The quantity of milk involved was, of course, enormous. As I say, 56 per cent. of all our school children were supplied with milk, the loss upon which was borne by the community. It did not come out of the Government's pocket at all, but was cheerfully borne by the community. Now the Milk Marketing Board is put into cold storage. Its activities are stopped, with the consequence that to-day, compared with before the war, the distribution of milk is costing this country a total sum of £13,500,000 per annum, and the cost of administering the milk scheme by the Government is £600,000. The Milk Marketing Board and all similar costs were absorbed and paid for by the consumer when the consumer was able to buy milk more cheaply than he is doing now at 4½d. a pint.
I do not know if I can follow Lord Beaverbrook further in his suggestion that this country can produce all its own foodstuffs. I do not think that is possible. I would commend to him a very valuable book that has been written with that ulterior aim by Colonel Pollitt, but even there, on the capital side, he estimates we should want something like £1,500,000,000 to finance it—some fabulous astronomical figure. Personally, if I may say so to Lord Beaverbrook, I think the problem after the war will be to demobilize a lot of the land that has been mobilized under the stress of war conditions, and that this country cannot possibly grow all its own food. It can produce, and always has produced, its own liquid milk. We are doing it to-day in war-time, and our liquid milk production 1077 is very much higher than it was in 1938. These things we can pay attention to, and as soon as the interferences with trade, as demonstrated by the differential profits which are allowed for the distribution of milk, and the exorbitant profit apart from the differential profit, allowed for this purpose disappear—as soon as these regulations are repealed, private enterprise in this country will provide us with all the milk we want, and a great deal of the food we must have.
§ VISCOUNT BLEDISLOEMy Lords, far be it from me to appear in any way to criticize the Ministry of Food or the very able and enlightened Minister who presides over that Department, but as long as the consumer has to pay two and a half times what the producer receives, it seems to me there is enormous scope for a very definite improvement in the milk organization and administration of this country. I mention two and a half times because, after careful inquiry, the eleven Peers of different Parties to whom my noble friend Lord Beaverbrook referred came to the conclusion that the difference between the producers' price and the average consumer's price was in the order of about two and a half times. However, what I want to point out is this, that as long as one-third of the whole of our population is suffering more or less from malnutrition in the matter of milk, which has been emphasized by our greatest authority, Sir John Orr, there must be a very string case not merely for producing a much larger quantity of milk in this country than we do to-day, but for purveying it to the poorer classes with the smallest amount of profit to the middleman and reducing the large difference which there is between what the producer receives and the consumer pays. I understand that milk furnished to children in schools is provided at a far less middleman's charge than the milk provided to the ordinary public.
That is all to the good, but when my noble friend Lord Beaverbrook talks about this country being self-sufficient or a self-supplier in the matter of food generally, I am afraid I cannot travel the whole way with him. I have reason to believe, in the light of various farm economies largely due to the greater use of machinery, that it may be possible in days to come to raise something like two-thirds of the whole of our essential foodstuffs on our own soil. 1078 But one has to face the fact, and it is a fact which I regret I am bound to say has always been a stumbling block to me, that if we attempt to raise by more intensive production the whole of our essential foodstuffs on our own soil, then, if we are to trust our economic experts, there will not be a quid pro quo available to our exporting manufacturers for the goods they supply to other countries. There is another thing that has been rather troubling me since the noble Lord raised this question. What is to happen to Canadian butter and Canadian cheese? After all, they are milk products which come mainly to-day, with the removal of corn-petition from Denmark, from New Zealand on the one hand and Canada on the other. Are all the noble Lord's old compatriots in Canada going to face the prospect of the whole of our milk products being raised within the confines of this country? I fancy they will have something rather different to say on that subject. However that may be, I will go as far with him as suggesting that, if we economize our methods of production and if we take the trouble to eliminate disease from our cattle, which we are not doing to anything like the extent we ought to do, we can raise two-thirds of the whole of our essential foods within our own shores and certainly the whole of our liquid milk.
LORD STRABOLGIMay I ask this question regarding disease in cattle? Is the noble Viscount aware of what is being done by the Northern Ireland Government in eliminating tuberculosis in cattle, arid can be explain why we have not done that?
§ VISCOUNT BLEDISLOEI am afraid, my Lords, I cannot profess to have any complete knowledge as to what is being done in Northern Ireland as regards tuberculosis, but in many countries besides Northern Ireland there has been an almost total elimination of bovine tuberculosis as the result of careful and rather drastic Governmental administration. Tuberculosis as derived from bovine sources is practically unknown in New Zealand today, and so we can trust dairy products coming from New Zealand as not likely to convey that disease. All I want to say in conclusion is that I was one of those who had to participate in the administration of the first Ministry of Food in the most precarious years of its existence. 1079 When I say "precarious" I mean that the danger of interruption to our food supplies from overseas was greater in the year 1917 than it has been, I believe, at any time in our history. We were then drawn into most intimate contact with the main food distributors in this country. In the process of maintaining contacts naturally the Department desired then, and I dart-say it does now, to reduce those contacts in order to facilitate administration as much as possible, but it was always rather sad to me to realize that in this close contact and rationalization, as my noble friend Lord Perry said, we were in effect encouraging monopoly. I venture to hope with him that whatever else may happen we shall fight the monopolistic tendencies of food distributors in every possible way, and if my noble friend Lord Woolton is helping in that process, as I believe he is, he will not have a warmer sympathizer in the process than myself.
THE DUKE OF MONTROSEMy Lords, I think all of us, especially those of us who farm, are grateful to the noble Lord for bringing forward this question. We all realize that milk is not only a liquid but also a food, and that it is of the utmost value, especially to children. Therefore those of us who are producers of milk wish to get this valuable commodity over to the public, to the consumer, as cheaply as we can. We are in sympathy with the idea that the cost of the distribution of milk should be as reasonably low as it can be made. But I am not one of those who believe that the retailer of milk is always the archenemy of the producer, and that he is taking more than a reasonable share of profit for the work which he performs. There is no doubt that the retailer of milk docs a very useful service, and those of us who are producers know that his costs have grown and are growing. To-day in Scotland the margin which we allow to our retailers is 11¼d. Before the war it was 10¼d. I must say that the general increases in all costs, including those due to the long haulage and the increased amount of control, and also the more scientific practices in the treatment of milk, have fallen on the retailer, because the producer has his price fixed while the retailer has to bear these additional burdens.
In the old days when towns were small, in many cases there were farms inside the 1080 town and milk was retailed at a very short distance. It was retailed by children, it was retailed from open cans, and there were no hygienic restrictions such as we have to-day. No doubt it was possible then to retail milk much more cheaply than it is to-day. If you consider the position to-day, with the long motor haul, with all the scientific treatment of the milk, with the regulations about the cleanliness of services and the putting of milk into bottles or cartons, I do not think 11¼d. will show a greater profit to the retailer. I doubt whether he is getting more profit than the retailer got twenty-five years ago at round about 8d.
I gathered that my noble friend Lord Beaverbrook was comparing the case of the big combines with the small retailers. In Scotland we have very few big combines. The biggest is the co-operative society and the co-operative society has the cream of the trade. The co-operative society buys milk in large quantities, sells it over the counter for cash and makes a charge on the bottles against non-return of the bottles. If a depot runs short of milk it can quickly get a fresh supply. The co-operative society has all the advantages of ready cash payment and of premises dotted round the towns. I do not know whether the cost of those premises is charged in the retailing cost of the milk, but I doubt it. The ordinary retailer has to charge it. He cannot fall back on anybody else for additional supplies, and therefore he has to carry every day a good deal of milk which he cannot sell. Unless you have two rates of retailing charges I do not see how you can make a difference.
Although 11¼d. may show a profit to the large retailer, I do not think the small man can do it for less. Unless you have two rates, one for the big combine and the other for the small retailer, I do not see how you can have any alteration in the present prices. And when you come to draw a line between the big retailer and the small retailer, how are you to arrive at what is big and what is small? It is a very knotty problem. I do not think the small retailer, with all the restrictions to which he is subject to-day, can make a living at any figure under 11¼d. The noble Lord said you can make a living without looking for it. Yes, and you cm sit on a thistle without seeing it. It is a difficult question, and I do not think anything can be done in war-time, 1081 but after the war, when the reorganization of agriculture is in hand, it would be a very right thing to consider whether the retailing of milk should become a national service or remain in private hands.
§ LORD WINSTERMy Lords, I have listened with great interest and, if I may say so, with great admiration to what my noble friend Lord Beaverbrook said upon this subject, and I think we shall all be agreed that he has indeed put his finger upon a most vital point in our national economy to-day. This is a matter which affects the well-being and the health of the poorest sections of the community. I would like to point out in this connexion that the situation is very different in this war from what it was in the last war. In the last war Denmark, Holland and Norway, were all sending us food. We are more likely to have to send them food in this war. Many compliments have been paid to my noble friend Lord Woolton in this debate. I join in them, and if he will allow me to do so I pay a very sincere tribute to the work of the noble Lord. I got a little frightened, however, the other day when the noble Lord told us that his was the only Ministry which could lose this war. I got a little nervous about megalomania then. I felt I could not endorse that view because, after all, the noble Lord's Ministry only distributes what other Ministries produce for him.
§ LORD WOOLTONNo, no.
§ LORD WINSTERThe Minister of Agriculture produces something and the Minster of War Transport brings in something and the business of the noble Lord is to distribute what they offer to him.
§ LORD WOOLTONI am in no danger of megalomania, I hope, but I do buy all ever the world in order that the Minister of Transport may bring it here.
§ LORD WINSTERThat may be so, but I say with great respect and with no unfriendly feeling that when the noble Lord talks about his Ministry being the only Ministry which could lose this war he is really pitching his case a little too high. I should not have intervened in this debate except for what was said by my noble friend Lord Beaverbrook on the subject of the U-boat menace and the fact that the curve of that menace is moving upwards. That evoked a response in my mind because for some weeks now I have 1082 been endeavouring to make a study of the question of the allocation of the shipping tonnage which is available to us. Such tonnage as we have available has to be allocated under certain heads—import of raw materials, import of foodstuffs, transport of soldiers overseas, transport of supplies to those soldiers when they are overseas. This question of the allocation of tonnage is one of the first importance. Perhaps not sufficient attention has been paid to it up to date. The more I study this question—and I have the assistance in my studies of one of our leading statisticians—the more I am inclined to feel that we are possibly allocating too much of our available tonnage to the import of foodstuffs and not enough of our tonnage to the necessities of our military requirements.
What my noble friend Lord Beaver-brook has said in this debate directly bears upon that. I have not yet completed my studies, but so far as I have got at present, if I compare the position to-day with the position in the last war, we are certainly devoting more tonnage to-day to the import of foodstuffs and less tonnage to our military requirements than we were in the last war. I think that is a most serious matter. We are embarked upon a great commitment in North Africa to-day, and we are told that if affairs go well in North Africa they are merely the prelude to yet greater military operations. They are the springboard for greater operations in Europe. We also have the promise that we are to open what is called in a convenient phrase the Second Front at an early opportunity.
The prior call upon our tonnage at the present moment is surely our military requirements, but I fear very seriously indeed that we are allocating too much of our available tonnage at the present moment to the import of foodstuffs and an insufficient quantity to our military requirements. That is a most serious state of affairs. I think insufficient attention has been devoted to it. I have it quite clearly in my mind that if we are to develop our military operations in accordance with the promises which have been made to us by the members of the Government, certainly we shall have to reconsider, and reconsider very drastically indeed, our existing rationing policy and our existing fat cattle policy. In the allocation of our tonnage our military re- 1083 quirements should certainly be regarded as having a prior claim. Let me say frankly that our rationing policy has been, in my belief, too generous. I think also that our fat cattle policy does not take sufficient account of our military needs where tonnage is required. I feel that this question of the allocation of our existing tonnage requires the most careful consideration. I am not at all sure that we are not being too generous at the present time in regard to our rationing and in regard to our fat cattle policy.
I call attention to this because really I fear that the danger of the present position in regard to this question of the allocation of tonnage is not yet realized. We have the most reassuring statements made about the existing shipping position. The Prime Minister made one last week, and the effect of his statement was to convey to the people of this county that everything was completely all right. He said: "I wish to leave the enemy to their delusions. The enemy's claims in regard to our shipping losses are completely exaggerated and I wish to leave them to their delusions." My Lords, the enemy have no delusions about the claims which they make. It is quite true that they put out exaggerated claims for propaganda purposes, but the German Admiralty and the German authorities have no delusions whatever about those claims. They know the position respecting our shipping and the allocation of our shipping just as well as our own people do. There is no question of their having any delusions on this matter. Their U-boat commanders are put through just the same grilling and just the same examination as our own submarine commanders are put through in respect to their claims and as our air pilots are put through after a raid. There is no question of the enemy being under any delusion about the losses they are inflicting upon our shipping at the present time.
I think it is very unfortunate in regard to our shipping, and particularly in regard to the question of the allocation of our shipping in response to the various calls made upon it, that these statements should be made. But I beg that we ourselves do not entertain any delusions as to the enemy being under any delusions about the losses which they are inflicting upon our shipping. The figures which they are publishing show quite clearly that they 1084 know quite well what they are doing. I think with respect to this question of food and the question raised by the noble Lord, Lord Beaverbrook, the contention, which so many people have so long put forward, is borne out that this suppression on our part of the figures of our losses is a great mistake and prevents us from looking in the face the real necessity, the really pressing necessity, of making a proper allocation of the tonnage which is available.
§ THE MARQUESS OF SALISBURYMy Lords, may I venture to raise a point of order and to ask your Lordships whether the noble Lord will kindly explain what relevance his argument has to the Motion which is now before the House?
§ LORD WINSTERMy Lords, certainly I will do so. I think my noble friend Lord Beaverbrook most clearly related his arguments to the U-boat menace and to the fact that the curve of our losses, due to the activities of the U-boats, has moved up. I relate my arguments to these statements made by Lord Beaverbrook in support of his Motion. However, I gladly defer and bow to the view of the noble Marquess, and I will not labour that point further. But I do say with respect to these points which have been brought forward by my noble friend Lord Beaver-brook, do let us relate them, as Lord Beaverbrook has urged, to the shipping position as it exists to-day. Do let us relate them to the necessity for making a proper allocation of our existing tonnage between our food requirements and our military requirements, and do not let us be deluded by the completely misleading statements made by members of the Government regarding our shipping position in the course of the last few days.
§ LORD GEDDESMy Lords, I do not wish to make a speech but I should just like to ask the Minister if he can deny—which I am afraid he cannot—the very serious allegation made by Lord Perry, that clean tuberculin-tested milk is being mixed with milk known to be infected with bovine tuberculosis and brucella abortus, the cause of undulant fever, in the Government milk depots. That statement has been made on many occasions recently. I received it in a communication the other day. If it is true—as I am sure Lord Perry must know it to be—I think it should be stated in this House that our children's milk is being deliberately contaminated by the Government.
§ LORD WOOLTONMy Lords, if I may intervene now, I am sure that the noble Lord will not expect me to say that the Government of this country is engaged in deliberately contaminating the children's milk. If I may, I will deal at once with that matter, which has, of course, nothing to do with the Motion before the House, but Lord Perry raised it, and he was not alone in moving a long way from the Motion before the House. I rather welcome the opportunity of telling Lord Geddes that I wish at a very early date to make a statement in this House on the subject of tuberculin-tested milk. I will go further and say at once that I am not at all satisfied with the present position. The present position is this—do not let us take too dark a view of the subject—that the tuberculin-tested milk that is produced by farmers and can find a market is being sold as tuberculin-tested milk. The T.T. milk which cannot find a market is being mixed with other milk. But when the noble Lord, Lord Geddes, suggested that all other milk which went to children contained al these germs he was clearly taking too pessimistic a view of the situation.
§ LORD GEDDESMy Lords, there has been, as I am sure the noble Lord is aware, a definite statement by the British Medical Association, and I think also by the Royal College of Physicians, on the subject of this contaminated milk. I have not the papers here, because I did not know that this subject would be raised; thought we were dealing simply with the question of prices. However, when the noble Lord, Lord Perry, makes the statement that this milk is being mixed, and when it is proved by the medical profession and by the results that a good deal of the milk produced in this country to-day is infected by bovine tuberculosis and by brucella abortus (the cause of undulant fever), and when it is stated that that milk is being mixed and, without pasteurization, sold to the children of this country, that is surely a serious allegation. However, as the noble Lord has said that he is going to make statement on the subject at an early date, I shall not press it any further.
§ LORD WOOLTONMy Lords, if I may now refer to the Motion before the House, I hope your Lordships feel that we have had an interesting debate. It has certainly been interesting to me, because two of my 1086 personal friends, who as far as this Motion is concerned are poles apart, have been apparently in some sort of alliance. My noble friend Lord Beaverbrook has many credentials to offer to your Lordships' House for making the speech which he did; and, if he will not think it presumptuous of me to mention his credentials, they are that for many years before this war began he has been urging upon the public of this country the importance of British agriculture. He mentioned the fact that as a Minister I am three years old to-day. I should have had very many fewer headaches during those three years if Lord Beaverbrook's advice had been followed in the previous years. When he comes to us to-day, therefore, and emphasizes the importance of considering the extension of agriculture, I welcome what he has said. It may perhaps be true that he has gone a little far. Here I am treading on the field of my noble friend the Duke of Norfolk. It may be that in this matter my noble friend Lord Beaverbrook has been hitching his wagon to a star which is a very long way off, and I cannot go with him on that joy ride. It is true, however, that during this war we have been able to increase the produce of our fields by 70 per cent. My right honourable friend the Minister of Agriculture was telling me yesterday of his hopes for this year. It is certainly true that the more we can increase our production at home, the safer we are.
§ LORD WINSTERObviously.
§ LORD WOOLTONThe noble Lord, Lord Winster, quoted something which I said on a previous occasion, and feared that I might be in danger of complacency. Believe me, you cannot be complacent if you are Minister of Food, for something comes up and hits you every minute. On the occasion referred to, I was talking to members of the Ministry of Food, and urging them to continue with great assiduity the work which they were doing. I told them that it was left to other Ministries to organize victory and to win the war, but that if we went wrong, and if we failed to feed the people of this country, we should lose the war. I am grateful to the noble Lord for being concerned about my spiritual welfare in this matter, but, when he has heard the whole of the story, I am sure he will realize that his concern is perhaps unnecessary.
1087 Behind everything that Lord Beaver-brook said was a very old story, the story of the importance to this country of the small man. Lord Beaverbrook has for many years been the champion of the small man in industry. He has been the enemy of the monopolist. It is amusing to see him sitting on the Bench opposite. I should think that he must feel a little uncomfortable in doing that while expounding these views against Socialism; but nothing on earth would persuade me to be drawn into any political argument.
§ LORD WOOLTONI am interested to know that the noble Lord has apparently abandoned his philosophy. There is some danger of treating the small man as though he were a political idol, and as though there was some particular virtue in his smallness. This is no static class. What is the origin of the milk combines about which Lord Beaverbrook spoke? What in fact is the origin of most of our large industries in this country? I come from Lancashire. Even within my own memory I have seen quite small men in business rise, by risking their capital, by enterprise and by daring, and become very large people, building up industries very important to this country. What is the history of the chemical trade in this country? There are those of your Lordships who will remember the romantic story of Mr. Brunner and Mr. Mond, with a capital of a very few thousand pounds. They developed what is now one of the most important industries in the country. What is the history of the motor car trade in this country? What is the his-story of distribution generally in this country? It has been a history of small people with great enterprise and great commercial ability, speading their wings, taking risks and finally developing great public services.
The milk combines, as they are called, are no exception to this. When these people are small, when they are in the nursery stage, then they are the pets of my noble friend Lord Beaverbrook; but when they rise and become, as the result of their enterprise, important, then he quotes the Bible at them at one moment and calls them monsters the next. I am not taking any emotional sides in this 1088 issue. The important thing is to secure that we have in this country such a system as will make it possible for these small people, if they desire to do so, to continue in business—a system that protects them from the commercial acquisitive instincts of the larger people, who might be prepared to lose money for a time in order to knock them out of business. We have avoided that mistake as far as the milk trade is concerned.
In the system of rationalization, about which my noble friend Lord Perry was, if he will forgive my saying so, just a little out-of-date—in that system what have we done? We have secured the position of the small man. We have said to him: "You shall have a recognized gallonage of milk which you can distribute, only you shall distribute it along certain streets in certain areas." In certain instances—and this was the reason of my intervention; I hope my noble friend knows me too well to think it discourteous—in certain instances we have said to people who, for war reasons, do not want to continue in business, that they should continue to draw through the war-time association of the district their proper share of the profits of their enterprise whilst the other people carried on that enterprise. It has happened in the case of men who have been called up who had milk rounds. The war-time association of the district, comprising all the people in milk distribution, have met together and allocated the rounds, and they have dealt with these particular hard cases. Therefore the people are continuing to get some sort of living although they are not actively engaged in the business.
This system of rationalization has, for the first time, given the small man a position of security. He no longer has to seek his trade against the large combine or against the co-operative society, with the inducement of dividends to encourage people to trade with it. And if he wants to sell his business—and there is no reason why people should not want to sell their businesses in the course of their lifetimes—he has something very definite to sell. He has never had that before. He does not have to face the large buyer who says to him, "Well, in all probability half these customers will go away." He can go to the large buyer and say to him, "Here I have a definite round, a round allocated to me by the war-time associa- 1089 tion, a definite gallonage of milk." And there is something which he can sell, and sell to good account
The discussion to-day has ranged a little wider than milk. My noble friend Lord Perry, who is a great individualist—and I hope that we shall continue to have great individualists in this House—doe; not like the Ministry of Food. He does not like its operations in general; he thinks we are interfering with free enterprise and free competition. And, of course, he is quite right. That is what we set out to do. We are only doing it for the period of the war. I am sure it must be a great relief to your Lordships to know that ail the powers under which I operate are powers that are given to me only for the period of the war. But I would like to take up the points which Lord Perry has made, and which ran all the way through Lord Beaverbrook's remarks on this question of the amount of the margins that we have allowed to people for trade. I had to fix the margins on a national level, a level that enabled the small man to live and prosper, provided he was reasonably efficient, even though he might be operating on the hills in a remote part of Scotland, in disadvantageous conditions for trade. I agree at once with Lord Perry that that is the basis on which these margins were fixed. They are margins that are at a higher level than the large firms needed if those firms were efficient.
Lord Beaverbrook encouraged me—a most extraordinary proceeding. He said: "Go and despoil the monopolists." That would be a confusion of function. That is what we have a Chancellor of the Exchequer for. He, in the Government, is the person who takes from the monopolists the extra profits that they have earned, and I hope your Lordships will agree that he is doing it extremely well. Therefore if it is true—and I should admit that it is true—that these larger organizations are getting larger margins than they really need in order to do their job, then the Chancellor of the Exchequer is standing at the other end of the chain to take away the profits that they make.
Let me ask your Lordships to look at the margins in the milk trade and just see what it is that we are talking about. There used to be an over-all margin in the milk trade from the farmer to the customer. I am not going to defend the margins that we have to-day, I am 1090 merely going to report progress as to what is happening as the result of the operations of the Ministry of Food. If I had accepted Lord Perry's advice when he gave it me in a Report which many people have spoken about but few have read, I should have fixed a margin for the retailers which would have put most of them out of business. Lord Perry believes in competition. He thinks that there should have been free competition in the retailing of milk, each retailer competing with the other so that we got the lowest price. I think he would finally have allowed the retailer who had to get some of his milk from a wholesaler, 5½d. I hope that in time to come these people will be able to distribute milk at 5½d., but I am quite certain that if we were to ask them to do it now we should have a disturbance of the supply to the public, and that would be a most serious thing indeed.
§ LORD PERRYI think the noble Lord is mistaken. If he is referring to the Perry Report on milk, there was no recommendation which would have reduced any margin below 8d. The recommendation, on the contrary, was that it should be a flat margin—which it is not—nationally and seasonally, that it should not vary so that the price of milk varied, as it does now, upsetting poor people's budgets, because milk costs more in winter than in summer. There was no recommendation that anybody should get as low as 5½d.
§ LORD WOOLTONI understood Lord Perry's Report, which I have read with great care, to say that the margin should be 8d., but the man who has to buy the milk from a wholesaler would have to pay the wholesaler 2½d., and that would have brought him down to the figure I mentioned. We have had so many Reports and so many Commissions on this subject. We have been talking about it now for thirty years, and we have done nothing very much. I have made an effort to do something. I have increased the producer's price, to begin with, by rod. a gallon, and since the outbreak of war the margin for distribution has remained practically stationary; it has, in point of fact, I think, gone up about ½d. But the most important thing is that I have devised a system of costings. Your Lordships know that I have never hesitated to say that the spread between the producer of agricultural products in this country and the consumer is much too high; but it is 1091 no use talking about its being too high. What is required is that someone should try to find a way out of the difficulty, and the way out of the difficulty lies in getting facts. It was because of the great work which Lord Perry did in his Report—although I did not accept it, he knows how grateful I was to him for producing it—that after I had read it I started to deal with the milk trade as I would deal with a business. For the first time we now have extensive castings about the milk trade. We know how much each operation is costing, and it is on the basis of these costings that I am building my hopes for the future.
A lot of people are getting double profits. The producer-retailer is getting double profits. He is a farmer and he is also a retailer of milk. I hold that these two profits have nothing at all to do with one another. He deserves his profit as a farmer and if, in addition to going in for the job of farming, he goes in for the job of delivering milk, he deserves his profit as a retailer. Then there are some retailers who are wholesalers as well. The wholesaler-retailer receives two margins. Here I hope the noble Lord, Lord Beaverbrook, will think I have gone some way with him. The wholesaler-retailer receives two margins, but he only receives one profit. There is all the difference in the world between being a farmer and being a retailer, but a wholesaler and a retailer are parts of the same industry. Therefore in that case what I have said is that he shall receive the full retail margin of profit, but for self-wholesaling he shall receive a margin that will only cover his costs. I know that some of your Lordships have said these costs are very high, but milk is of no use except as a food, and it cannot become a food until it has left the farm and got on to the table. This process of distribution is not to be regarded as a parasitic trade. It is quite essential for the public and also for the farmers. I was very glad to hear the noble Duke, the Duke of Montrose, saying that we should not regard retailers as if they were the arch-enemies of the farmers.
Your Lordships will bear with me while I go through the processes through which the milk goes. It goes from the farm to the collecting depot in the country. From there it goes to the wholesaler in the town, who delivers it to the retailer's premises, and the retailer takes the milk from his 1092 dairy or his shop to the house. The only castings I have not investigated are the costs of the producers of milk—that is outside my province. But to each distributing process I have given a reasonable profit, and I have told the traders, much to Lord Perry's regret, that I propose to direct their activities in order that we may achieve a reduction in costs. His Majesty's Government buy the milk. The farmer has an assured price and an assured market. His Majesty's Government undertake all the costs of depot operations—cooling, etc.—and any economies that are effected in transport as the result of the directions that I give go to the credit of the State. The wholesaler has his margin. His margin is 2d., for processing, pasteurizing, and delivering to the retailer. The retailer has a margin based on the costings, and that margin is the same whether he buys from the farmer or whether he buys from a wholesaler.
This is an elaborate process of costings. Some retailers have a dual function, so we fix 750 gallons as the amount which they are likely to be able to deliver from a fixed point. The milk is delivered to that point without transport costs to the retailer. They get 10½d. in London from to-day and, if your Lordships are interested, 95/6d. in the provinces. If more than 750 gallons is involved, then their business is extended. They are covering a wider area, need further points of distribution from which to deliver to households, and employ extra transport or else extra premises. The bigger the area they cover, the bigger the cost to them. That is the reason why we have not said in this case, "The bigger the trade you do, the lower the margin you shall get," because costings have demonstrated—I am not talking from theory, but from hard facts produced by the accountants—that these men have bigger costs to meet when they cover a wider area from the centre. But they are both wholesalers and retailers. We do not give them the full margin of the wholesaler and the full margin of the retailer. That would be 2d. per gallon as a wholesaler. We fix a maximum of 1,500 gallons. They get, not 2d., but 1¼for that if they are retailers and self-wholesalers. If they are distributing less than 1,500 gallons, they get 1d. down to a figure of 750 gallons, when they get1½d. The whole of the railway rates to which Lord Beaverbrook referred now go to the 1093 credit of the State, and it is no longer possible for people to make profits by ordering their milk from the furthest possible point.
I hope that I have at any rate convinced you that in fixing these margins we have been working on a business-like basis and on actual facts as to what costs are. As a result of this I have been able to reduce the extent of the margins, I hope with the agreement of the trade. The retailer margin has been reduced by ½d. a gallon from to-day and the self-wholesale margin by a ¼d. Those are very small figures, as Lord Perry said, but in the aggregate they come to a lot. That small reduction means £2,250,000. I am carrying on the costings. These costings take comparatively little, if any, account of the very large amount of rationalization that we are doing. That rationalization process is a little slow. In Liverpool, where I happen to know a little more about it than I do of other places, we have had to alter the registration of 50 per cent. of the population in order to have only two milkmen in a street. That obviously is taking a good deal of time, but it is going on. We have already had an immense saving, as I think I said to your Lordships recently, in motor power, an immense saving of petrol and a considerable saving in man-power. I am quite sure that all these savings added up ought to come in the long run to a considerable saving in costs, and the trade has agreed with me that whatever these savings are, as proved by our accountants, they shall come back to the State. Therefore I look forward very hopefully to the time when we shall get nearer and nearer, as a direct result of the intervention of Government Departments to the ideal which Lord Perry put before us in his Report.
I hope I have convinced your Lordships. I am afraid I have been very long, but it was a detailed subject on which, both here and in another place, there has been a good deal of doubt, and I wanted the opportunity, which I have ventured to take, of making it quite clear that whatever the superficial view of these prices may be they have not been fixed by guesswork. They have been fixed actually on the cost of the operations that have been performed. I hope, finally, that I have convinced my noble friend Lord Beaver-brook. With the courtesy that he has always shown me, he was good enough 1094 to tell me what he was going to say today. I hope I have convinced him that the small man in this milk industry, as a direct result of the operations that it has fallen to my Ministry to perform, is in a position of safety and security, now and for the period of the war, such as he has never known before.
§ LORD BEAVERBROOKMy Lords, my noble friend has convinced me that he is a very good Parliamentary Minister as well as a very good administrator, one of the best of the Parliamentary Ministers, but he has not in the very least met the issue of more production. Perhaps I should not have expected him to do so. Perhaps the responsibility for that rests elsewhere. On the issue of prices he has not answered at all. The producer-retailer, if he distributes in one little centre, is at a great disadvantage compared with the big combine. If he extends his delivery to eight, ten or twelve centres, then he gets on the same basis as the big combine. That is the whole story. At present the producer-retailer is at a disadvantage. He is not given an equal opportunity; he is not given a fair chance compared with the wholesale co-operative societies and the United Dairies. That is what we complain of. My noble friend answers: "Ah yes, but the United Dairies distribute over a very much wider field." Well, the producer-retailer would be glad to distribute over a wider field if he could get the opportunity, but he cannot get that opportunity because he is restricted to a very narrow field. He is not permitted to distribute for a number of communities, and he is at a disadvantage on a money basis.
My noble friend says the Chancellor of the Exchequer will look after that. No he will not; he cannot look after it. The big combines use their money for the purpose of buying out the producer-retailers. When they use their money for buying out producer-retailers they are in fact extending and expanding their capital, and by extending and expanding their capital they are raising continually the Excess Profits Duty level, as I think it is called, but all the time they are getting higher and higher margins of profit which are free from Excess Profits Duty. This idea that the Chancellor of the Exchequer corrects abuses, and that therefore you can go on paying anything with the full knowledge that in time the Chancellor of the Exchequer- will recover it again, is quite 1095 wrong in practice. My noble friend is a good business man and will not disagree with me in that respect.
Furthermore, he has said that the producers get rod. more for production, but of course at the same time my noble friend is charging the producer a great deal more for the feeding stuffs that he sells to him, so that the 10d. is something given with one hand and taken back with the other. The producer is just exactly where he was.
§ LORD WOOLTONBut the retailer's costs have gone up.
§ LORD BEAVERBROOKThey have not gone up to the same extent. My noble friend has made such conveniences for the retailers as to facilitate their deliveries to such an extent that they have been given opportunities to relieve themselves altogether from competition, and he has recently compensated them for any advances that have taken place in the cost of distribution. But I do not want to go any further into this question of cost, because I understand perfectly the case made by the Minister just as he understands the case made by me. I only hoped he would give me an assurance that the producer-retailer would be given a better opportunity as the days go by to meet the advances in his cost of distribution. I was hoping that my noble friend would have gone further. Can be promise that he will continue to bring this "spread" as it is called more nearly together?
§ LORD WOOLTONI promise the noble Lord that I will continue to take costings and on the result of those costings will fix new prices from time to time.
§ LORD BEAVERBROOKThat is exactly nothing. I wish my noble friend Lord Bledisloe would raise at an early date his question of the production of foodstuffs in Britain to meet our necessities. I should like to see that issue debated in this House. Many authorities could be quoted in support of the view I take, authorities that would impress even my noble friend Lord Bledisloe, as he well knows. My noble friend the Minister has told us that there is a 75 per cent. increase in agricultural production since the outbreak of war. Did I understand him rightly?
§ LORD WOOLTONSeventy per cent. was the figure.
§ LORD BEAVERBROOKSeventy per cent. since the outbreak of war. It is a tremendous increase. It brings the level of production up to something like 75 per cent. of our requirements. If we can do that, can we not make another extension, another development that will give us all the benefits and advantages that we so greatly desire, benefits and advantages that would be an immense contribution to the war effort?
I am obliged to my noble friend for sympathizing with me because he thinks I am speaking from an uncomfortable Bench. I can assure him I do not find it in the least uncomfortable. I speak from the proper place, which I am expected to speak from and entitled to speak from. It is the others who feel uncomfortable. I am most grateful for the speech which my noble friend Lord Perry delivered more brilliantly than I could hope to do. There is one word I would say about the speech of my noble friend the Duke of Montrose. He ought to know that in Scotland co-operative societies have an immense advantage over other sellers of milk. That is what I am complaining about. Those fine shops with their great fronts are paid for by my noble friend. The wholesale co-operative societies get their milk more cheaply than the producer-retailers. That is my complaint. We are thinking about the same thing, except that possibly the noble Duke is not aware that these co-operative societies are already favoured by my noble friend the Minister in the purchase of milk.
I want to say one last word about my noble friend Lord Winster's speech. It seems to me he was entirely in order because he followed my plea for more production at home by pointing out that in that case ships could be diverted from the North Atlantic in order to carry troops. That was my point. I beg leave to withdraw my Motion, and I do that more cheerfully than usual because I think my noble friend knows the grievance and that perhaps he will do something about it. I hope he will. I presented the case of the producer-retailer because I think and believe he is entitled to buy milk at the same price as the cooperative societies, United Dairies and other great combines.
§ Motion for Papers, by leave, withdrawn.