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Food Inflation

Volume 740: debated on Tuesday 14 November 2023

3. What recent assessment he has made of the implications for his policies of trends in the level of food inflation. (900037)

4. What recent assessment he has made of the implications for his policies of trends in the level of food inflation. (900038)

20. What recent assessment he has made of the implications for his policies of trends in the level of food inflation. (900054)

UK food inflation has been driven largely by global factors and has already fallen from 19.6% to 12.3%, and external forecasts expect it to continue to fall.

Between March 2021 and April 2023, the cost of first infant formula increased by 24%, on average, with the cheapest formula on the market increasing by 45%. That is an absolute catastrophe for families who rely on infant formula, but a bonanza for the formula companies, which are making significant profits out of this. Can the Chancellor tell me why he believes it is right for companies to profit while families struggle to feed their babies?

The hon. Lady is absolutely right to draw attention to the pressures on families caused by very high food inflation in a number of areas, but I can tell her that the Competition and Markets Authority, which undertook a review of the groceries sector earlier this year, has not yet found evidence that high food price inflation is being driven by weak competition. But it is continuing its review and looking at the supply chain, and we will wait to hear what it says.

Recent research showed that the most significant decline in UK children’s height in the global ranking came after the UK coalition Government launched their austerity programme in 2010. An expert in child growth rates at the Great Ormond Street Institute of Child Health said of that 30-place drop in ranking that austerity

“has clobbered the height of children in the UK.”

What lessons has the Chancellor learned from the UK Government’s previous disastrous errors of judgment in this area, and how will he be supporting vulnerable groups in the future?

The lesson I have learned is straightforward: if we had not reduced the deficit by 80% between 2010 and the start of the pandemic, we would not have been able to help families across the United Kingdom with payments of more than £3,000, on average, including 700,000 households in Scotland and more than 1 million pensioners.

Even if the inflation rate is falling, food prices are still going up considerably. The Joseph Rowntree Foundation reckons that they have gone up at least twice as fast as the value of benefits since September 2021. At the very least, can the Chancellor commit to ensuring that the Department for Work and Pensions has enough resource to raise benefits at least in line with September’s inflation rate?

The Secretary of State for Work and Pensions is doing his review at the moment to decide the correct amount by which to uprate benefits. If the hon. Gentleman looks at this Government’s record, he will see that we took the decision a year ago to uprate benefits by inflation, and we committed to £94 billion of measures to help families get through the cost of living crisis.

Food inflation will only get worse if our self-sufficiency in food production drops. Will my right hon. Friend consider fiscal measures to discourage the transfer of food-producing land to other uses such as solar industrial installations?

My hon. Friend is right to say that our food industry is very important to food security. We need to keep the priorities constantly under review. Nature is a very important part of that, but so too is food production.

It is good to be addressing an elected Minister this morning. The consumer organisation Which? has described Tesco and Sainsbury’s as committing “dodgy” practices over food prices and loyalty schemes, and Marks & Spencer has just posted record profits on food sales, yet people up and down the nations of the UK are struggling to pay their food bills. Will the Chancellor tell us which supermarkets he has held to account over rising food prices?

I can tell the hon. Gentleman that we had the supermarkets in over the summer to make sure that they were doing everything they could to bear down on food price inflation. However, the correct way for politicians to look at this is at arm’s length. We have the independent Competition and Markets Authority, which does a rigorous job and often does things that politicians disagree with, and it is looking at the issue right now.

In Canada, Ministers met the five largest grocery chains to get commitments on stabilising food prices. Other Governments are doing similar things. France’s Finance Minister held extensive talks with the food industry to get it to commit to freezing or cutting prices on 5,000 everyday products. Is it not the case that, for people facing crushing food bills in Scotland and across the nations of the UK, this Westminster Government are doing absolutely nothing?

I think £94 billion of support to help families up and down the country, including with food prices and energy prices, is a rather different answer from saying that we are doing nothing.