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Food Prices

Volume 928: debated on Monday 14 March 1977

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asked the Secretary of State for Prices and Consumer Protection how long he expects the present rising trend in food prices to continue.


asked the Secretary of State for Prices and Consumer Protection what he expects the rise in food prices will have been from July 1976 to July 1977.

The food index rose by 81·5 per cent. between February 1974 and January 1977. I am not prepared to forecast the rate of increase for the year to July 1977 or to guess how present trends may change.

Those statistics are worrying enough, as are the statistics which the Secretary of State gave me recently in reply to another Question. Can he reassure the country in any small way at all that the rate of increase of previous months and years will be decreasing during the coming year? Does he not appreciate that it is confidence in the present Government which is at the root of the price of sterling, and that the price of sterling is at the root of the price of food?

Certainly the price of sterling is the main determinant in the price of food. Of course, the price and the value of sterling have appreciated considerably between December and now. The hon. Gentleman must himself interpret whether that is the result of improved reputations abroad of the present Government. The comfort I offer the consumer is that, if we can hold sterling at or about the present level, the adverse effects of October, November and December of last year will not reappear and food price changes will not be as bad as they were during that period.

Does my right hon. Friend agree that food prices within the Common Market are on average considerably higher than world prices? Does he not find it remarkable, in view of the rather hypothetical concern expressed by the Opposition about prices, that the only idea of policy that the Leader of the Opposition has made herself clear about is opposition to any idea of a price freeze?

That is very true. My hon. Friend will have noticed, as the whole country has noticed, that while the Opposition have a great deal of criticism to offer about prices and prices policy they have nothing constructive to say about what they would do in its place. The Leader of the Opposition has said nothing positive during the six months that I have been in this job. If she has said it, it has been my misfortune to miss it. I hope that in the coming months we shall have a debate about prices and prices policy, if only to discover whether the Opposition have any policy at all.

Is the right hon. Gentleman aware that many people will hardly believe that the figure which he has given of 81·4 per cent. is the true figure for the rise in prices? Is not that an appalling indictment of what the Government have done and what the British housewife has had to suffer? When will prices stop rising?

The answer to the hon. Gentleman's question of when food prices will stop rising covers a spectrum of facts from when there ceases to be a shortage of coffee as a result of frost in Africa to when there ceases to be drought in England and when the pound continues on its stabilised path. My view is that all these things are a great deal more complicated than any Opposition Member ever pretends he understands or is prepared to make out.

In view of the stress which my right hon. Friend has rightly put on the fall in the value of sterling accounting for price increases, may I ask whether he is satisfied that the public are aware of the impact of the sterling crisis upon prices? When there are major price increases in areas which directly affect the public most, will my right hon. Friend issue information explaining the extent to which that is the result of a fall in the value of sterling?

I shall try to do that, but it is sufficiently difficult to educate the Opposition on these matters and I think that educating a wider public, albeit a less biased one, might be very much more difficult.

If the purpose of consumer advice centres is realistically rather than, cosmetically to help to bring down prices, will the right hon. Gentleman consider extending these to rural areas, or possibly having mobile advice centres, so that people living outside cities may have the benefit of them?

I am not sure that the object of these centres is to bring down prices. Rather is it to provide information which is necessary and appropriate. The hon. Gentleman is right. One of the things that I have tried to do over the past year is to extend mobile centres that can go for a time each month to rural areas. The more we can do that, the better. We have extended the grant for a year, and I hope that local authorities which feel that they want to abandon the centres will think again, because I agree that they perform a valuable service.

Would the right hon. Gentleman care to comment, if not on food in general, on bread, which once again, according to TheTimes, has raised its head? Will the right hon. Gentleman comment on the resolution of the Price Commission that only a portion of the price discount is an allowable cost? Will he comment on whether that is a change from previous practice? Is it not a fact that manufacturers may recover cost of production globally and not just line by line, as appears to be the case for bakers?

As I understand it, the Price Commission made clear to the bakers its position on recoverable costs. I discovered that the Price Commission made the position clear before the bakers adjusted prices after Christmas. That seems to be a decision for the Price Commission, and for it alone.