§ 53. Mr. Ashtonasked the Chancellor of the Exchequer whether he will give an estimate of the financial effect of abolishing council house subsidies and food subsidies and of the effect of this on the cost of living of the average family.
§ Mr. TaverneIn 1968 central Government housing subsidies to local authorities amounted to £129 million and subsidies to agriculture and food to £285 million. If rents were increased by the amount of the housing subsidies, the rise in the index of retail prices as a result of the abolition of housing subsidies would be approximately 1 per cent. The effect on retail price of the removal of all food subsidies would depend on the nature of the system which replaced the present support arrangements and on the response of producers both at home and overseas, but it has been estimated that the elimination of deficiency payments would increase food prices by between 4 and 7 per cent.