Extract from second
reading (Commons) of the Digital Markets, Competition and
Consumers Bill
(Wokingham) (Con):...I was
pleased to see my right hon. Friend the Prime Minister take a
great personal interest in food production. I believe he held a
very successful seminar yesterday and asked the Secretary of
State for Environment, Food and Rural Affairs to go away and work
up a series of measures. I do not doubt the enthusiasm of my
right hon. Friend the Secretary of State, which I fully share and
have often promoted, for us to grow much more of our own food in
this country and to offer that much more choice to people in our
supermarkets
However, when I look at the package of measures the Department
has brought forward, there is hardly anything in it that would
carry that ambition through...
For context, OPEN HERE
Westminster Hall debate
on Food Price Inflation and Food Banks
(Cynon Valley) (Lab)
I beg to move,
That this House has considered food price inflation and food
banks.
It is a pleasure to serve under you, Mrs Harris. I am pleased to
be able to put some points to the Minister for Food, Farming and
Fisheries, the right hon. Member for Sherwood ().
I would like to raise a number of points, so I hope the Minister
will indulge me, even if I do stray into the Treasury brief. I
sought this debate because of the growing concern about food
price inflation and food poverty. It is a year since I conducted
a cost of living survey in my constituency about people’s
experience of the cost of living crisis. There was a major
concern about the growing cost of energy—not then at its peak,
but still a dominant issue at the time. The survey also showed
that people were worried about the cost of food, with 36% of
respondents, including 61% of those on benefits, skipping meals
last year. Almost 50% of those asked said they would be cutting
down on essentials, such as food, in the months ahead. It seems
that that has been the case in the past 12 months.
The Trussell Trust food bank covering Merthyr and Cynon Valley,
which opened in 2011, has been helping families since that time.
In the past year, it provided a record 2,800 emergency food
parcels to people in Cynon Valley—a 31% increase. That included
more than 1,000 emergency food parcels for children, which is a
disgraceful 33% increase. There has been a long-term increase in
need over the past five years. Food banks in Cynon Valley have
seen a 61% increase in need since 2017-18.
The Trussell Trust is not the only local food bank. The Salvation
Army food bank in Aberdare has helped more than 1,600 people in
the past year, and the numbers are growing. Those people often
live alone, are elderly or have lost their jobs. Running food
banks is getting harder and they need more support, including
from local supermarkets A
volunteer at another food bank at Fernhill in my constituency
recently told me about how they had to provide kettle packs—yes,
kettle packs—for those reliant on a kettle when they cannot
afford to cook. Women also regularly come in to pick up sanitary
products.
The rise in food bank use can be seen across the United Kingdom.
The Trussell Trust reported that it gave out 1.3 million
emergency food parcels in 2017-18, but almost 3 million in
2022-23. What are the reasons? The Trussell Trust has said that
the growth in the need for food banks is about a shortage not of
food but of money: a long-term cut in pay, a long-term cut in
social security, and bills accelerating ahead of incomes. That is
a political choice.
Between April and August 2022, over half of food banks surveyed
by the Independent Food Aid Network found that 25% or more of the
people they supported had not used their services before. They
are increasingly people in work in social care, the public sector
and across sectors. Work does not pay, and that is the reason for
in-work poverty.
(City of Durham) (Lab)
I thank my hon. Friend for securing this important debate.
Yesterday it was reported that desperate parents are having to
steal baby formula to feed their children. It is seen as stealing
but, of course, it is survival. Does she agree that the
Government should consider price controls on essential items such
as baby formula?
I certainly do. My hon. Friend makes an extremely important
point—we are the fifth richest nation in the world and people are
being forced to take such steps. It is absolutely disgraceful and
shocking. I will come to food prices in a moment, so I thank her
for that intervention.
It was also only yesterday that the Office for National
Statistics reported another monthly fall in real-terms pay. For
17 months in a row, pay has risen below the rate of inflation.
That is a pay cut. Indeed, the TUC says that workers have lost
more than £1,000 from their pay over the last year. What is
clear—beyond doubt—is that wages are not driving inflation; if
anything, they are a drag on it.
In a new poll for More in Common UK published today, 75% of those
polled said that the cost of living is one of the biggest issues
facing the country and 45% said they are shopping around more for
groceries; when looking at those bills going up, it is
increasingly the weekly food shop. The Office for National
Statistics reported earlier this month that food and
non-alcoholic drink inflation was at 19.2% and that around half
of adults are buying less food when they go shopping.
(Reading East) (Lab)
I am grateful to my hon. Friend for giving way and for her work
on this important issue. One piece of analysis has even shown
that the prices of some basic food items are rising by 30%. My
hon. Friend is right about the scale of the challenge facing many
families. Is she aware of the pressure facing those in work in
addition to the pressure for those on benefits? In my area, many
people living in the suburbs—people who have jobs—are now
attending food banks to keep their families from falling into
terrible poverty.
Yes, I am very aware of those people. I work closely with food
banks in my community, as I know other Members do, so I know that
there has been a significant increase in the number of people in
work who are accessing food banks, which is completely
unacceptable. It is unacceptable for anybody to be using
them.
Why are prices going up? We have to be clear that there are
multiple causes. Droughts, climate disaster, fuel costs and the
Ukraine war have all had an impact. However, as Unite the union
has set out in real detail in its research on profiteering, which
looks at the profits of companies in the FTSE 350, all of this
has been made worse by profiteering along global supply chains,
from agribusiness multinationals to high street supermarkets It is not
just Unite saying that. The European Central Bank recently
said:
“Profit growth remained very strong, which suggested that the
pass-through of higher costs to higher selling prices remained
robust.”
The top eight UK food manufacturers made profits of £22.9 billion
in 2021, with both profits and margins up 21% on 2019, with
Nestlé, Mondelēz and Unilever all benefiting from double-digit
growth in profit margins. In the supermarket sector, Tesco,
Sainsbury’s and Asda—the top three UK supermarkets—nearly doubled
their combined profits to £3.2 billion in 2021 compared with
2019.
Supermarkets are turning over hundreds of millions of pounds and
handing dividend payments to wealthy investors, who are obviously
not the people struggling to eat. In 2021-22, a total of £704
million was paid by Tesco in dividends and last July the company
also paid shareholders £1 billion in its share buyback
scheme.
The problem is that people who are reliant on low pay and social
security are funding these exorbitant dividend payments and I
really do not understand how the Government can justify that; I
am interested to hear what the Minister has to say. People who
cannot even afford to go to supermarkets are
going to food banks. This is a crisis—a cost of living crisis—and
it should not be allowed. We have taken action to control energy
prices. When are we going to take action on the cost of food?
In Wales, where the Labour Government are in touch with ordinary
people’s concerns, we are doing what we can, despite our
underfunding by the UK Government. The Welsh Government are
rolling out universal free school meals, which are now available
in reception and years one and two, and they have a timetable to
roll them out to all children in primary school. Think how much
more quickly they would be rolled out in Wales if there was a
fair, needs-based funding formula for central funds to the Welsh
Government.
(Liverpool, West Derby)
(Lab)
I thank my hon. Friend for the fantastic work that she does in
her community on the issue. Does she agree that the Minister
should follow Wales’s lead and introduce universal free school
meals? The Government should introduce a free school breakfast
and lunch for all children in state education and, alongside
that, enshrine a right to food in law, so that all children and
adults have enforceable food rights, and we tackle the scourge of
hunger in our communities.
I congratulate my hon. Friend on the sterling work that he does
on the Right to Food campaign in Liverpool. I totally agree that
the UK Government need to follow the Welsh Government’s lead and
roll out universal free school meals to all children. I thank him
for his intervention.
Universal free school meals could be rolled out across the UK
if supermarkets and
suppliers were not allowed to pay such enormous dividends to
shareholders, and instead paid a windfall tax. Imagine that—food
retailers taxed to provide free school meals. It is an obvious
thing to so. Elsewhere around the world, other Governments are
taking action. In France, the Government have announced an
anti-inflation trimester, during which supermarkets are
expected to make discounts on food that will cost them, according
to the French Prime Minister, hundreds of millions of euros. That
appears to be a voluntary scheme. Carrefour and
Casino supermarkets have made
cuts. We need more information on the scheme’s impact and the
benefit for families, but I hope that the Government are watching
and discussing the matter with their French counterparts. Will
the Minister respond to that point? Another example is
Switzerland, where food is subject to price regulation. Prices
there grew at a rate of 4% in December last year, compared with
nearly 12% in the US and nearly 17% in the United Kingdom. Have
the Government considered how Switzerland regulates its food
pricing?
Sadly, this Tory Government are not taking action. I looked at
the outcomes of yesterday’s food summit, which was renamed the
Farm to Fork summit—no reference whatsoever to food inflation or
food poverty. I note that the union most heavily involved in the
food sector and agriculture, Unite the union, and the Bakers,
Food and Allied Workers Union were not invited to the summit.
Why?
The Environment, Food and Rural Affairs Committee
“is to investigate how profitability and risks are shared through
the food supply chain and the existing government system of
monitoring and regulation of these.”
On Monday, the Competition and Markets Authority announced
“the stepping up of our work in the grocery sector to understand
whether any failure in competition is contributing to grocery
prices being higher than they would be in a well-functioning
market.”
Will the Government commit to learning from those processes, and
will they look at other Governments’ interventions in their food
markets? The crisis is such that the Government must act now,
even while those investigations go on.
What should the UK do? First, we must inflation-proof incomes.
Many of us on the Opposition Benches have been calling for that
for a long time. That means an end to the Tory low-pay agenda
that cuts public sector workers’ pay in real terms. Secondly, the
Government should adopt the Trussell Trust and Joseph Rowntree
Foundation’s call for an essentials guarantee. That would mean an
independent process to determine the level of that guarantee,
ensure that universal credit meets that level, and ensure that
deductions do not take it below that level.
Thirdly, we need a windfall tax on food profits for supermarkets and, where
possible, suppliers. If we can have such a tax on fossil fuel
suppliers, why not food suppliers? It is incumbent on the UK
Government to engage with that proposal, for which they have set
a precedent, given what they have done on oil and gas. The tax
revenue could be used to expand the provision of free school
meals, as my hon. Friend the Member for Liverpool, West Derby
() just said. Fourthly, we need
controls on food speculation, as the former shadow Chancellor, my
right hon. Friend the Member for Hayes and Harlington (), said in a debate
yesterday. Finally, have the Government explored any mechanisms
for a price ceiling on a core basket of goods? People are
struggling in this cost of living crisis, and this Government are
standing by as they suffer.
I will finish with some personal commentary. Prior to entering
this place, I volunteered at a local food bank for a long period.
It will never leave me: when I looked into the eyes of the people
coming into the food bank, I saw despair, but also a sense of
embarrassment and shame at having to access a food bank in the
fifth-richest nation in the world. It is an absolute disgrace.
The answers are there; this is a political choice. It is
extremely urgent that immediate action be taken by the UK
Government to resolve this issue.
4.16pm
The Minister for Food, Farming and Fisheries ()
It is a pleasure to serve under your chairmanship, Mrs Harris. I
thank the hon. Member for Cynon Valley () for securing today’s
important debate. I also pay tribute to her efforts in her
constituency, and in her previous roles before joining this
House.
We have seen food price inflation continue to rise. As the hon.
Lady said, it was 19.2% in March 2023, up from 18.2% in February.
That is the highest rate that we have seen in 45 years. I
certainly recognise the impact that high food prices are having
on household budgets and on tackling inflation, and this
Government’s No. 1 priority is to lower—to halve—that
inflationary rate this year. Yesterday, as she identified, the
Prime Minister hosted the first UK Farm to Fork summit, which
focused on how Government and industry can work together to bring
great British food to the world, build resilience and
transparency across the supply chain, strengthen sustainability
and productivity, and support innovation and skills.
Can the Minister inform the House—my hon. Friend the Member for
Cynon Valley () touched on this—whether any
trade union representatives were invited to the UK Farm to Fork
summit held at Downing Street yesterday? I have tabled a written
question on that, but the response was not very clear.
I am not privy to the whole guestlist, but of course there is a
limit to the capacity in No. 10 Downing Street. There are lots of
people who would have liked to be there whom we were not able to
accommodate. However, it was important that we drew together
industry leaders—retailers, processors, and primary producers—so
that they could work together on delivering innovation in the
sector, and so that they could try to lower food prices and not
only make our great British food producers competitive across the
world, but benefit our constituents.
Following that summit, we announced a package that includes a
broad range of actions to strengthen the resilience of our
farming sector and drive long-term sustainability. That includes
a new set of principles to protect farmers’ interests in future
trade deals, more funding to help producers export, plans to
reduce red tape for farmers looking to diversify their income
streams, and making it easier to build glasshouses in the UK.
Last week, the Chief Secretary to the Treasury met supermarkets to discuss
the cost of food, and the Chancellor is meeting them again
shortly to discuss how we ensure that consumers have access to a
range of affordable food, in recognition of the pressures that
people and producers are feeling. We have also provided
significant support this year, worth an average of £3,500 per
household. That includes direct cash payments to the most
vulnerable households, as well as our uprating benefits and the
state pension by 10% in April.
Food banks are a great example of the generosity of spirit of
communities across the country. The Government do not have any
role in the operation of food banks, as they are independent,
charitable organisations that bring people in local communities
together to support one another. However, recognising that good
work, the Government will provide over £100 million of support
for charities and community organisations in England. It will be
targeted at supporting critical frontline services for the most
vulnerable people—services that are struggling to meet increased
demand.
The Minister has not yet addressed the idea of a windfall tax
on supermarkets Are the
Government looking at that? Is the Minister saying that food
banks are acceptable? That is what I took from what he just said.
Surely we should be ending the use of food banks in the
fifth-richest nation in the world. It is appalling that they
exist.
I am grateful for the hon. Lady’s intervention. What I was saying
was that I recognise the great work that those in food banks do.
I recognise the work that the charitable sector does to support
the most vulnerable. I am not saying that food banks should be
the model for the future; I am saying that the great work they do
should be recognised. The best way to get out of poverty should
be through work and opportunities to earn a fair wage, so that
people can afford to buy their own food.
On that point about wages, the Bakers, Food and Allied Workers
Union found that four in 10 food workers are forced to skip
meals. Over 60% of respondents to its recent survey said that
wages are not high enough for them to meet their basics needs.
The people who produce food cannot afford to buy and eat it. What
does the Minister say to that?
We are slightly straying into the area of the Department for Work
and Pensions and the Treasury, as the hon. Member for Cynon
Valley indicated at the beginning of the debate, so I hesitate to
comment too much. What I would say is that that is why the No. 1
priority of the Government is to get inflation under control. As
the hon. Gentleman identified, the people who are most vulnerable
and who are struggling to make ends meet are the people who are
damaged by high inflation. In ’21-22, 93% of UK households were
food-secure; that is virtually unchanged from’20-21, when it was
also 93%. In ’21-22, 3% of individuals, or 2.1 million people,
lived in households that had used a food bank in the previous 12
months.
My Department is working across Government to ensure that we have
the right support in place to address rising food price
inflation. More than 8 million households are eligible for
means-tested benefits. Some will receive additional cost of
living payments totalling up to £900 in the ’23-24 financial
year. Over 99% of the first cost of living payments this year
have already been made. For those who require extra support, the
Government are providing an extra £1 billion of funding,
including Barnett impact, to enable a year-long extension of the
household support fund in England from April. That is on top of
what we have provided since October 2021, bringing total funding
to £2.5 billion. From April 2023, we increased the national
living wage by 9.7% to £10.42. That represents an increase of
over £1,600 to the annual earnings of a full-time worker on the
national living wage; estimates suggest that could help over 2
million low-paid workers.
I once again thank the hon. Member for Cynon Valley for
introducing this debate. I reassure her that the Government take
food prices seriously. We will continue to work across
Government.
(North East Fife)
(LD)
I apologise to the Minister and the hon. Member for Cynon Valley
() for missing the first 30
seconds of the debate. The Minister talked about working on a
cross-departmental basis. He knows that I have asked this
question before. I am very pleased to see that the Government
have not taken the Home Secretary’s approach to the seasonal
agricultural workers scheme and the 45,000 visas. Will we get
some security and certainty about the extension of that scheme
over a longer period, so that farms can invest in the equipment
they need to deliver different ways of picking our fruit and
vegetables, and can train people?
I am grateful for the hon. Lady’s question. I hope she recognises
that yesterday was a huge step forward in guaranteeing those
45,000 visas for next year. That allows farmers to plan for the
future and organise next year’s staff rota. She also recognises
the importance of innovation and investment in new tech. That is
why the Government are investing millions of pounds in new
technology and the development of agritech, including robotics
and equipment to help farmers become more efficient. We will
continue to work across Government and with industry to ensure
that everyone has access to affordable food. I thank hon. Members
for participating in the debate.
Question put and agreed to.
Extracts from Lords
debate on the Licensing Act 2003 (Liaison Committee
Report)
(Con): The irony is
that sales of alcohol in the
off-trade—supermarkets—overtook the sale of
alcohol from the on-trade—pubs and clubs—some four years ago. The
price of drinks in bars is too high for most people to get drunk
and pre-loading with cheaper drinks bought for consumption from
the off-trade, where training and supervision are almost
non-existent, is where many of the problems occur. The late-night
levy effectively remains a form of additional taxation on some
businesses which operate during the evenings and night time. The
fact that, since its creation in 2011, only a handful of the 350
local authorities in England and Wales have introduced a
late-night levy, while others have issued consultations on it but
not subsequently introduced it, continues to make me wonder why
the levy has been kept—particularly as councils are obliged to
spend their 30% of the late-night levy share on matters tackling
alcohol-related services connected to the management of the
night-time economy, whereas the police have no obligation to
spend their 70% on any such measures, but can spend it on
anything of their choosing. I am pleased therefore that this
topic is being looked at again in detail...
(LD):...As we know, there
has been a large increase in the amount of alcohol bought from
supermarkets—we just heard that from the noble
Lord, Lord Smith—especially during the pandemic. This brings us
to recommendations about the use of taxation to control excess
consumption. Following years of resistance, the Government have
taken welcome action on high-alcohol white cider, because of its
use by alcohol abusers. However, there is more to do. I welcome
the Government’s commitment to review the new alcohol duties
after three years but ask the Minister what further action they
plan to take—for example, by reviewing the effect of minimum unit
pricing in Scotland and Wales. In doing so, will they always bear
in mind the needs of those licensed businesses which serve
alcohol to moderate drinkers with or without a meal? They are
legitimate businesses and their profits are already under a great
deal of pressure...
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