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Food Prices

Volume 932: debated on Thursday 26 May 1977

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asked the Minister of Agriculture, Fisheries and Food if he will publish his estimates of the contributions to changes in the price level of food attributable to (a) the reduction in the exchange value of the £ sterling, (b) changes in subsidies provided by Her Majesty's Government, (c) changes in world food prices, and (d) changes in EEC food prices, between the first quarter of 1974 and the present day.

I regret that I cannot provide information to answer parts (a), (c) and (d) of the Question. The effective which of those settlements are usually influenced by the findings of the Pay Research Unit, and how; and what was the percentage increase in earnings of each group in 1974, 1975 and 1976.

The groups with whose pay settlements my Department is involved are primary and secondary teachers and further education teachers in England and Wales, and university non-clinical academic staff in Great Britain. These settlements are at national level and are not influenced by the findings of the Pay Research Unit. Figures for increases in average earnings are not available and the following figures relate to increases in basic average salaries:exchange value of sterling declined by about 26 per cent. between the first quarter of 1974 and April 1977, but the EEC system of monetary compensatory amounts has reduced the effect of this depreciation on the prices of commodities covered by the common agricultural policy. Food prices have also been affected by weather, changes in guaranteed prices and costs of manufacturing and distribution, and changes in EEC support prices and world prices. The separate effects of these factors cannot be reliably assessed. As for subsidies financed by the Government, in the first quarter of 1974 the milk subsidy was equivalent to a reduction in the Retail Price Index for food of 1·3 per cent. and, in April 1977, the subsidies on milk, bread, cheese and flour were equivalent to a redutcion in the Retail Price Index for food of about 0·7 per cent.