§ Mr. Austin MitchellTo ask the Minister of Agriculture, Fisheries and Food what is his estimate of the capital value of milk quotas to British farmers.
§ Mr. Austin MitchellTo ask the Minister of Agriculture, Fisheries and Food what is the cost of higher milk prices as a result of quotas; and what was the cost of buying up and disposing of surplus milk and milk products before the quotas were imposed.
§ Mr. CurrySince 1983–84, the year before quotas were introduced, the intervention price of butter (82 per cent. fat) has been reduced from 357.86 ecu/100 kg to the present level of 300.80 ecu/kg. The intervention price for 1153W skimmed milk powder has moved from 149.64 ecu/100 kg to 174.04 ecu/100 kg but intervention buying for both skimmed milk powder and butter has virtually been brought to an end. Despite the existence of quotas a substantial surplus still exists in the dairy sector; the Government have been urging the Commission to make further cuts in the level of export refunds and other disposal subsidies in order to ease the supply situation—and hence prices—on the open market.
Expenditure on surplus disposal measures for milk and milk products under the FEOGA guarantee section in 1983 amounted to 4,923 million ecu, not counting the offsetting effects of coresponsibility levy receipts.
§ Mr. Austin MitchellTo ask the Minister of Agriculture, Fisheries and Food what is the size of the United Kingdom milk quota in litres; how many million litres of quota have been sold in each of the past three years; and if he will provide an estimate of the average price paid for quotas in the first month of each quota year together with the implied cost per litre of output amortised over a period of three, five and 10 years, respectively, at current rates of interest.
§ Mr. Curry[holding answer 27 July 1989]: United Kingdom milk quotas on 1 April 1989 were as follows:
Litres Wholesale quota 14,503,970,784 Direct sales quota (of which 5½ per cent, was temporarily suspended 372,501,084 European Community regulations do not allow the sale of quota as such, but quota is transferred in proportion to the areas used for milk production when all or part of a dairy holding is sold, leased, or transferred by inheritance. The total volume of quota transferred in the United Kingdom in each of the last three quota years was as follows:
Year ending Million litres 31 March 1987 646 31 March 1988 750 31 March 1989 546 My Department does not collect price data on transactions involving quotas. Information available from published sources suggests that typical values attributed to quota in England and Wales were as follows:
Pence per litre April 1986 12½ to 14 April 1987 25 to 27 April 1988 27 to 30 Amortised costs over a number of years at various interest rates can be calculated by applying appropriate equivalent annual cost factors. These can be obtained from "Investment Appraisal in the Public Sector, Her Majesty's Treasury 1982" (page 40). A copy is in the Library of the House.