§ Mr. Deakins
asked the Minister of Agriculture, Fisheries and Food what would be the effect on United Kingdom farm prices and retail food prices of a devaluation of the green pound by 1 per cent.
§ Mr. Peter Walker
If the green pound were devalued by 1 per cent., institutional prices in the United Kingdom would rise by about 1 per cent.
The extent to which the increase in institutional prices would be reflected in retail food prices would depend on many factors, including the market circumstances of the individual commodities concerned. If the increase in institutional prices were to be directly reflected in retail prices, I estimate that the effect would be an increase of less than one fifth of 1 per cent. in retail food prices assuming no change in traders' margins.