Consumer Protection and Cost of Living

Part of the debate – in the House of Commons at 12:00 am on 30th November 1970.

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Photo of Mr Alf Morris Mr Alf Morris , Manchester Wythenshawe 12:00 am, 30th November 1970

To revert to my speech, the right hon. Member for Lowestoft's comment was extremely thin. But now that his levy plan has received so much attention in the Press I trust he will be asked by the Leader of the House to come here and make a full and early statement so that we can question him upon it.

Meat is but one of the important commodities which will increase in price as a consequence of the policy on which the right hon. Gentleman has now embarked. The policy will also affect many other major food commodities which form such a big element in the cost of living, particularly for working people. The cost of food takes up much more of the expenditure of the poorer sections of the community than of the wealthier. In the general retail price index, food represents 28·8 per cent. of the total expenditure of households.

For a household consisting of two persons living on a pension, the proportion of expenditure represented by food goes up to 43·4 per cent. For a single person living on a pension, the proportion is 42·2 per cent. These figures are weighted acording to the pattern of expenditure of the various households. There would be special hardship to pensioners and others living on small fixed incomes following the rise in food prices consequent upon the adoption of the import levy system. May we, therefore, be told whether retirement and other pensions will be increased before or after this policy takes effect next April?

Furthermore, the right hon. Gentleman should take an early opportunity of discussing the effects of higher food prices with Professor Peter Townsend and the Child Poverty Action Group. For the cold, watery porridge of FIS—family income supplement—will become even more offensive to the working poor when his import levies on food take effect. Seeking to minimise the effects of his policy, the right hon. Gentleman says that it will add only 2 per cent. each year to the cost of food over the period of the next three or four years. He then says that these are relatively small increases compared to the increases to which we have become used.

There are, however, five points which must be emphasised in reply. First, his estimate takes no account of any increase in distributors' margins. Second, the increases will be gratuitously imposed by the Government and will be entirely additional to other price increases which are going on all the time. Third, the policy has more to do with paving the way for entry into the Common Market than with the real interests of the British people. Fourth, it makes nonsense to have high food prices at home when abundant supplies are available in the world at bargain prices. Fifth, the increases will be concentrated on essential foodstuffs so that the poorer sections of the community will be the hardest hit.

The right hon. Gentleman, may, of course, be a very strong believer in the Common Market's agricultural régime and he may regard this as a sufficient reason for paving the way for British entry. But if that is his argument let him end the cant of promising to limit the rise in food prices to 6–8 per cent.

The Prime Minister has said again and again that we must come to terms with the Common Market's agricultural régime. But let me quote the recent words of one of the Prime Minister's leading colleagues at the abortive negotiation with the Six initiated by Mr. Harold Macmillan. My source is not a party political figure. He is one of Britain's most distinguished experts on the cost of adopting the Common Market's farm policy in this country.

He tells me: Wages and salaries must rise to compensate for the rise of 20 per cent. in food prices. So our competitive position in exports both to the E.E.C. and the rest of the world will be worsened. Our competitive position will be made worse still by our being forced to adopt indirect taxes, like the value-added tax, which will give further wage and salary increases. We could rapidly reach another balance of payments crisis and further devaluation. That in turn would increase food prices still further and you have the prospect of a truly terrifying syndrome. These are the words of Sir John Winnifrith, for many years until recently the Permanent Secretary at the Ministry of Agriculture, Fisheries and Food, than whom scarcely anyone knows more about the real cost for Britain of adopting the common agricultural policy of the E.E.C. He has been very much more closely involved in detailed negotiation with the Six than the right hon. Gentleman or, indeed, than the right hon. and learned Member for Hexham (Mr. Rippon). Moreover, as I know from working with him for a number of years, he is not given to exaggeration. His words provide the most eloquent possible comment on the Government's attitude to rising prices and their pretence about being concerned with Britain's economic strength.