Oral answer (Lords) on Agriculture: Dairy Prices - Apr 28

Asked by

The Lord Bishop of St Albans

To ask Her Majesty’s Government what assessment they have made of the impact of changing dairy prices on farmers.

The Question was considered in a Virtual Proceeding via video call.

The Lord Speaker (Lord Fowler)

The Minister, Lord Gardiner of Kimble. Lord Gardiner? We have no Minister. Is the Whip able to answer this Question?

Lord Foulkes of Cumnock (Lab Co-op)

Perhaps the Whip can explain why there is no Minister.

Lord Ashton of Hyde (Con)

I will come in, as the Chief Whip. I am very sorry, but the answer is that I have no idea why my noble friend Lord Gardiner is unavailable. I apologise to the House. Something technical has obviously gone wrong, and I can only ask your Lordships’ forgiveness on this occasion. There will be a thorough inquiry into this, and I apologise to the House.

The Lord Speaker

Thank you, Chief Whip. Can you stay on the line and at least field the questions that will come? The right reverend Prelate needs to ask his supplementary.

The Lord Bishop of St Albans

Thank you very much. I cannot thank the Minister for his Answer because he has not given me one, but he will be aware that some dairy producers are unable to change contracts and are finding it extraordinarily difficult to access business support grants. What changes have Her Majesty’s Government made in the past month to cut red tape and save some of our dairy farmers who are going bankrupt?

Lord Ashton of Hyde

I should first declare an interest. I am not a farmer, but I own a farm and my tenant is a dairy farmer. Obviously, these are difficult circumstances. Dairy farmers have a particular problem. I know that there is a great difference depending on where dairy farmers sell their milk. For example, if they are selling their milk to supermarkets, that is okay, but those selling to other enterprises that are not functioning in the same way have different problems. I know that some have had to pour milk down the drain. I will take the right reverend Prelate’s specific question away and make sure that I get him a sensible answer because I do not know the details at the moment, I am afraid.

Lord Campbell-Savours (Lab)

Perhaps the noble Lord, Lord Gardiner, can give me a written answer to my question. I understand that Meadow Foods pays more to its farmers in Cheshire than those in Cumbria for milk. Furthermore, it cannot give any guarantees that the price in Cumbria will not fall further, thereby threatening the viability of the industry. How can the industry survive under such conditions without the Government temporarily—I repeat, temporarily—setting a national minimum price for milk, as happened under the old Milk Marketing Board? I suggest a price of 25p per litre.

Lord Ashton of Hyde

The noble Lord makes a very powerful point. I will ask my noble friend Lord Gardiner to answer that specifically. He raises an important issue about differences between parts of the country. I have just seen a message that my noble friend is having technical difficulties; I think we knew that anyway.

The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Lord Gardiner of Kimble) (Con)

Can noble Lords hear me?

The Lord Speaker

I can now, yes. Do you want to take over now?

Lord Gardiner of Kimble

I would very much like to. I apologise to noble Lords. I have been on to PICT for an hour now and therefore on the telephone.

The Lord Speaker

I think we will probably move on because I doubt the Minister heard the last question.

Lord Gardiner of Kimble

Lord Speaker, would you like me to give the right reverend Prelate his Answer?

The Lord Speaker

Yes, okay.

Lord Gardiner of Kimble

My Lords, I declare my farming interests as set out in the register. Dairy farmers are crucial in ensuring that food supplies remain resilient in this difficult period. While prices for most dairy farmers are largely unaffected, some have been impacted by the closure of the food service sector as a result of Covid-19. Defra is working closely with the NFU, the AHDB and Dairy UK to support farmers during this period of disruption.

The Lord Speaker

We have had the supplementary from the right reverend Prelate, so we will move on to the noble Baroness, Lady Bakewell of Hardington Mandeville.

Baroness Bakewell of Hardington Mandeville (LD)

My Lords, dairy farmers desperately need certainty for the price of milk. It is estimated that 20 million litres of milk would normally go into the food service sector. Only 20% of this market is still viable due to lockdown. The national dairy herd is nearly 2 million, with an estimated 80,000 cows likely to be culled if financial support is not forthcoming. Once herds have been culled, it will take a long time to rebuild capacity. Farmers want to be ready to meet demand once restrictions are lifted. The financial support legislation promised on 17 April has yet to be laid. Can the Minister say when this lifeline will come forward for legitimate inclusion in statute?

Lord Gardiner of Kimble

My Lords, it is very important for me to say that the easement of competition law for the dairy sector—a statutory instrument, which is widely supported by the devolved Administrations and industry—will be retrospective to 1 April. That will ensure that the competition rules are relaxed for the dairy sector temporarily to allow retailers, suppliers and logistics services to work together. This has allowed the dairy industry to redirect some of its supplies to retailers. Clearly, Defra is working very closely on this. It is an issue that affects, as has been said, those farmers who are supplying the food service sector, and we are working with others to ensure that the situation improves for those farmers affected.

Baroness Neville-Rolfe (Con)

I declare my interests as set out in the register. As has been said, the dairy industry is under huge pressure in the current crisis as coffee shops, cafés and canteens are closed, so I really welcome the move to lift the sale restrictions on liquid milk in supermarkets so that we can all drink more at home. But does my noble friend accept that the horticulture industry is an even more immediate difficulty? This would be eased if garden centres could reopen soon. Will he kindly press the case within the Government?

Lord Gardiner of Kimble

My Lords, I very much hope in the fullest extent that I will be answering a Question on garden centres tomorrow. I am of course sympathetic to the interests of the horticultural sector. We are working on that and a more fulsome explanation may come tomorrow.

Lord Macpherson of Earlâ