Milk and Dairy Industry
Oral Answers to Questions — Environment, Food and Rural Affairs
House of Commons debates, 29 October 2009, 10:30 am
Nicholas Winterton (Macclesfield, Conservative)
What recent assessment he has made of the economic prospects of the milk and dairy industry.
Jim Fitzpatrick (Minister of State (Minister for Food, Farming and Environment), Department for Environment, Food and Rural Affairs; Poplar & Canning Town, Labour)
We closely monitor the economic prospects of the sector, with an extensive review made on a six-monthly basis. I am also chairing the twice-yearly meeting of the Dairy Supply Chain Forum on
Nicholas Winterton (Macclesfield, Conservative)
The Minister will know that the UK dairy industry accounts for around 18 per cent. of UK agricultural production by value, is the single largest agricultural sector and is worth £3.5 billion. It is essential to this country, and to my constituency. What assessment has he made of the European Union's proposal to set up a fund for dairy producers, aimed at assisting farmers under pressure from unacceptably low and unfair prices?
Jim Fitzpatrick (Minister of State (Minister for Food, Farming and Environment), Department for Environment, Food and Rural Affairs; Poplar & Canning Town, Labour)
Only last week at the Agriculture Council, we raised our serious concerns about the fund that has been set up, which I am sure would meet the hon. Gentleman's concerns as well. We have been asking questions, and I also gave evidence on this item yesterday to the Environment, Food and Rural Affairs Select Committee, chaired by Mr. Jack. It is not clear how the €280 million is going to be separated and broken down, or what the criteria are for claiming it. We have concerns about that and we are monitoring the situation closely at ministerial and official level.
Patrick McLoughlin (Chief Whip, Whips; West Derbyshire, Conservative)
Why does the Minister think that bottles of mineral water sell for more than bottles of milk?
Jim Fitzpatrick (Minister of State (Minister for Food, Farming and Environment), Department for Environment, Food and Rural Affairs; Poplar & Canning Town, Labour)
I suspect that it is because the retailers think that people will buy it.
Michael Weir (Angus, Scottish National Party)
One of the problems with milk is that the supermarkets often sell it below cost price, which puts huge pressure on the producers. Will the Minister press his colleagues at the Department for Business, Innovation and Skills to look into this as part of the remit of an ombudsman, if they come forward with such a proposal?
Jim Fitzpatrick (Minister of State (Minister for Food, Farming and Environment), Department for Environment, Food and Rural Affairs; Poplar & Canning Town, Labour)
The Dairy Supply Chain Forum regularly looks at these issues, providing an opportunity for all sides of the dairy sector to come together. These matters are discussed there. The Competition Commission's recommendations are being discussed between Government Departments, and I know that this is a key aspect of those discussions. We will be announcing our conclusions in due course.