§ 3.9 p.m.
§ BARONESS BURTON OF COVENTRYMy Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
§ [The Question was as follows:
§ To ask Her Majesty's Government what has been the percentage fluctuation in the guaranteed price per gallon to the farmer for milk in the current year and the past year, and the percentage fluctuation in the retail price of milk over the same period.]
THE JOINT PARLIAMENTARY SECRETARY, MINISTRY OF AGRICULTURE, FISHERIES AND FOOD (LORD ST. OSWALD)My Lords, following an increase of 2 per cent. at the 1961 Price Review, the guaranteed price to the Milk Marketing Boards was reduced by 1 per cent. at the 1962 Review. The average retail price for liquid milk in 1962–63 will be about 3½ per cent. more than in the previous year. As my right honourable friend the Minister of Agriculture, Fisheries and Food said in another place on March 15 of this year, this rise was due partly to the decision of the Government that the milk consumer should bear the full cost of the guarantee, and partly to an increase in distributive costs and other factors. But for the reduction in the guaranteed price, the retail price would have been higher.
§ BARONESS BURTON OF COVENTRYMy Lords, while thanking the noble Lord for his Answer, might I ask him whether the same period has been compared in each case? Am I right in assuming that the first two figures that he gave us related to the past year and the current year, but that the retail price the gave us related to the ensuing year, 1962–63, and would it be possible to put the same period with the same period?
LORD ST. OSWALDMy Lords, I trust that I understood the noble Lady's 324 supplementary correctly. I think what I said regarding the retail price was that,
The average retail price … will be about 3½ per cent. more than in the previous year.Is that not the question she was asking?
§ BARONESS BURTON OF COVENTRYI am sorry, my Lords. Obviously, the mistake was mine. But might I ask the noble Lord whether it does not seem a little strange that these percentage fluctuations never are the same for the consumer and for the farmer? Is it asking too much in this imperfect world that sometimes they might approximate?
LORD ST. OSWALDMy Lords, the difference in the matter of milk is very hard to work out. The price of milk depends—as perhaps the noble Lady knows—upon the amount of milk which is sold above what is called the standard quantity, because what is sold above the standard quantity does not attract the guaranteed price; it has to be sold at a much lower price. Therefore, what the farmer receives is, in fact, something between the two, which is known as a pool price. So that the price in this case depends a great deal on how much over the standard quantity farmers actually sell, because by that amount they will be bringing down the price of the milk they sell.
§ LORD WALSTONMy Lords, could the noble Lord explain to us how it is that apparently the milk producer has been able to increase his efficiency sufficiently to make do with a reduction in price, while the distributor of milk has so failed to increase his efficiency that he has had to have an increase in price during that period?
LORD ST. OSWALDMy Lords, in the particular circumstances concerning milk the Government have thought it desirable to determine distributive margins, which is what the noble Lord has in mind. Before the war, the proportion of the retail price allowed to distributors was 42 per cent.; now it is less than 35 per cent., despite the great increase in the quantity of milk that is pasteurised and bottled as a result of the safe milk policy.
§ LORD WILLIAMS OF BARNBURGHMy Lords, may I ask the noble Lord whether it is not the simple fact that 325 this is the first year for many years that the Government have made no contribution whatsoever to the guaranteed price for milk, and that at long last the consumer is paying the whole cost? Would it not be as well if the noble Lord made that clear to the House?
LORD ST. OSWALDIf I were to make that clear to the House, I should also have to remind the House that the welfare milk subsidies continue and that the Government are spending £44 million annually on supplying milk to expectant mothers and to children under the national milk and the milk in schools scheme.
§ LORD WILLIAMS OF BARNBURGHDoes that alter my statement in any way, shape or form?
LORD ST. OSWALDI was not contradicting the noble Lord's statement; I was merely bringing in a statement of my own which I thought should be brought into the picture.
§ VISCOUNT ALEXANDER OF HILLSBOROUGHMy Lords, may we have a set of answers making the position of the producer amply plain? For example, if you take December, 1950, would it not be true to say that the winter price then to the farmer producing TT milk averaged about 4s. per gallon ex-farm, whereas at the moment, in December, 1962, he averages about 36 point something pence for the same article? And would the noble Lord also say what is the average price now over the whole year to the farmer for his milk ex-farm?
LORD ST. OSWALDI could give the noble Viscount a set of figures, but, over the last year, for five months it was 8d. a pint; for seven months it was 8½d.
§ VISCOUNT ALEXANDER OF HILLSBOROUGHThat is the consumer's price. I asked about the farmer's price.
LORD ST. OSWALDI am sorry. If the noble Viscount would ask me for a more specific answer I would come prepared, but I fear that I cannot give that information to him to-day across the Table.
§ VISCOUNT ALEXANDER OF HILLSBOROUGHThen may I just inform the Minister—
§ THE LORD PRESIDENT OF THE COUNCIL AND MINISTER FOR SCIENCE (VISCOUNT HAILSHAM)I think, my Lords, that this is not the moment for giving information to the Government but for asking them questions.
§ VISCOUNT ALEXANDER OF HILLSBOROUGHIs it not also necessary to let the consumers in the country know what is the true position of the farmer? And although I do not think the consumer distribution is overpaid, the distributors do manage by arrangement to make a net profit of 2d. per gallon.
§ VISCOUNT HAILSHAMI dare say, but the consumers can be informed in order or they can be informed out of order, and it is preferable to inform them when one is in order.