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Food Price Inflation
19 May 2022
Lead MP
George Eustice
Debate Type
Ministerial Statement
Tags
NHSUkraineClimateEnergyBusiness & TradeAgriculture & Rural Affairs
Other Contributors: 25
At a Glance
George Eustice raised concerns about food price inflation in the House of Commons. A government minister responded. Other MPs also contributed.
How the Debate Unfolded
MPs spoke in turn to share their views and ask questions. Here's what each person said:
Government Statement
NHSUkraineClimateEnergyBusiness & TradeAgriculture & Rural Affairs
Government Statement
The global spike in oil and gas prices has affected the price of agricultural commodities, as energy is integral to fertiliser manufacturing and food production. The invasion of Ukraine exacerbated this issue. Measures were announced to support farmers ahead of the growing season but these are not a silver bullet for rising input costs. Despite pressures on input costs and some rises in food prices, the UK maintains high levels of food security with self-sufficiency rates at 88% for wheat, 86% for beef, 100% for liquid milk and poultry, and more lamb produced than consumed. Food prices rose by 1.5% in April compared to March, though some categories like bread, cereals, sugar, jams, syrups, fish, meat increased while vegetables remained stable or decreased slightly. The Government has provided an additional £500 million through the household support fund to assist households with essentials.
Jim McMahon
Lab Co-op
Oldham West, Chadderton and Royton
Question
The Secretary of State’s response is disengaged from reality. He acknowledges rising food prices but fails to address critical issues like fertiliser plant closures, CO2 shortages affecting food production, and the financial strain on public sector services such as the NHS and schools. Working people face increasing poverty despite employment and rely heavily on food banks due to debt and escalating living costs. Will he commit to an urgent cross-Government commission involving industry and charity to tackle the impending food crisis by Christmas?
Minister reply
Despite acknowledging rising food prices, the Minister emphasises positive developments like falling fertiliser prices since March. He notes that carbon dioxide supply is stable as main plants meet demand for ammonium nitrate. The primary cause of household income pressure remains high gas prices and energy bills. Measures include raising the tax-free threshold and increasing the national living wage to £9.50 an hour, providing low-income earners with £1,000 more annually. He praises local food bank volunteers and benefits access efforts in his constituency.
Andrew Percy
Con
Brigg and Goole
Question
Compared with the last major recession we had under the Labour Government, we have done a great deal to expand provision, including free school meals to post-16 students and to all infant-aged children—something the Labour party never offered. On the issue of community food pantries and food banks, I commend to the Secretary of State the model established by Councillor Anne Handley in Goole, the Two Rivers community pantry and the incredible team of volunteers. They are providing heavily subsidised food to anyone in the town who wants it. We have received support via the Department for Environment, Food and Rural Affairs in the past. Can he assure me that that support will continue for amazing schemes such as the Two Rivers community pantry?
Minister reply
My hon. Friend makes an important point. Projects and charities such as that do indeed perform an important role in our country. Often, the strongest part of their role is not just the provision of immediate emergency support, but help for people to get the support that they need to address other issues and challenges they might have in their life, so that they can get things back on track.
Patricia Gibson
SNP
North Ayrshire and Arran
Question
The 9% rise in the consumer prices index is the highest since records began, with a quarter of those in the UK resorting to skipping meals. The Governor of the Bank of England has warned of an “apocalyptic” outlook for consumers, with the worst yet to come as inflation looks set to hit 10% by the autumn. Food banks are already struggling to cope as households face unprecedented demands with the cost of living. Food banks themselves are a clear sign that the welfare system is failing: that is why food banks exist. Will the Secretary of State argue in Cabinet for measures such as converting the energy loans into grants, the reintroduction of the universal credit uplift, a reversal of the national insurance hike and an inflationary uplift for all welfare and state pension payments, so that—in 2022, in the UK—we do not have to witness the scandal and shame of people being unable to afford to feed themselves and their children?
Minister reply
We have obviously made some changes to the benefits system over the years, in particular the introduction of a tapered reduction in universal credit; it always pays people to work more hours and take on more work. We are in a fortunate position in this country in one way: unemployment rates are very low—the lowest since 1974—with close to 1 million job vacancies, and wages for the lowest-paid have been rising.
Desmond Swayne
Con
New Forest West
Question
The same price shocks have left Japan and Switzerland with inflation nearer 1%. What difference in monetary policy has protected them and exposed us?
Minister reply
The analysis we have done on food price inflation—I would point out to my right hon. Friend that, in the month of April, food prices on average rose by 1.5%—suggests that around three quarters of the price pressures we have seen can be directly attributed to the price of gas and the remainder to other factors, including rising costs of labour as wages rise for the lowest-paid.
Tony Lloyd
Lab
Worsley and Eccles South
Question
In my constituency, many people before inflation began to become an issue were already finding it difficult to make ends meet. That is not propaganda; that is a matter of practical reality. Every Member of Parliament knows this about their own constituency. What I looked for from the Secretary of State was some indication that there was action that he and his colleagues in Government were going to take, and there came no answer. What is he going to do to help my constituents, who really are on the breadline?
Minister reply
The action that the Chancellor has taken so far was announced earlier this year in the spring statement. It included a £150 rebate on council tax bills, and a £200 rebate on energy bills to dampen and spread the cost of the spike in energy bills. We increased the national living wage in April to £9.50 an hour, and that puts an extra £1,000 in the pockets of the lowest-paid. Obviously, we keep this matter under constant review, as the Chancellor has made clear.
Scunthorpe
Question
My constituents in Scunthorpe and the surrounding villages well understand the global factors affecting the cost of living and of course food price inflation, but they are worried about what is to come. I know the Government have set out a number of measures, and we are doing a lot. When does my right hon. Friend think we will start to see the effect of those measures at the supermarket till?
Minister reply
The reality, as I have said, is that the changes in global commodity prices are being driven by the high price of gas and energy. As I pointed out earlier, the cost of fertiliser, which is one of the key drivers of those international commodity prices, has now fallen by 40% from its peak in March, and is now running at about £620 a tonne. If fertiliser prices remain at that level, or indeed continue to fall, we are likely to see pressure come off the forward prices of international commodities.
Barbara Keeley
Lab
Worsley and Eccles South
Question
I want to share with the Secretary of State the experiences of my constituent Rebecca, who is a single mum expecting her second baby soon. She said she reached out to me in “desperation and fear”, and she told me: ‘The cost of living has shot through the roof, it is unaffordable and I am having to make some pretty desperate decisions. My weekly shop amount has already jumped from under £50 per week to £75 a week… I am finding it virtually impossible to buy the necessary equipment for my baby’s impending arrival.’ How can the Secretary of State expect Rebecca and millions like her to struggle with tax increases and soaring inflation with no additional support? What is he going to do and what are the Government going to do to ease this pressure on families, which Rebecca tells me is now making her “fearful for the future”?
Minister reply
As I acknowledged in the statement, it is undoubtable that rising energy bills have affected household incomes, because people are paying more money on their gas and electric. Food prices have indeed risen—but across the year, with the rate currently at about 6.5%. Of course, we all have constituents with such challenges in their lives, and we all work with them. The Government have put in place the household support fund specifically to help those who fall between the cracks and cannot get support elsewhere, and we have doubled the size of that fund.
Richard Fuller
Con
North Bedfordshire
Question
In tackling the global pressures behind surging inflation—US monetary policy tightening, the increase in raw material prices and the conflict in Ukraine—my constituents prefer the Government’s considered approach to the knee-jerk reaction of the Opposition. The key aspect that is beneficial to most families is to put more money into their pockets through tax cuts. Will my right hon. Friend work with the Chancellor and the Prime Minister to see what room there is for tax cuts as part of our response?
Minister reply
These matters are regularly discussed in Cabinet, but it is perhaps best that I do not go further at this particular stage.
Alistair Carmichael
Lib Dem
Orkney and Shetland
Question
I remind the House of my entry in the Register of Members’ Financial Interests. Any fair-minded person can see that international factors are clearly at play, over which no Minister can have total control, but we can control the support that we give to our domestic food producers. Is this not the moment to do as the National Farmers Union has asked of the Secretary of State and pause the Department’s programme of basic payment cuts to farmers? They will see their payments cut this year by 25%, next year by 30% and the year after by 50%
Minister reply
The Government pledged to keep spending on agriculture in cash terms the same year after year in this Parliament, and that is precisely what we are doing. The right hon. Member is correct: we are phasing out the subsidy on landownership that meant that 50% of the budget went to 10% of the wealthiest landowners in the country and replacing it with a more logical approach that is about supporting the things that farmers do for the environment. Our sustainable farming incentive in England will deliver that by helping farmers with the cost of alternatives to fertiliser to chart their course. Of course, it is for Scotland and the Scottish Government to decide what they want to do in that regard, but we have a programme that is supporting farmers in England.
Fay Jones
Con
Salford and Eccles
Question
It is clear that food prices are up at the supermarket tills, but I am not clear about whether they are also up at the farm gate. Farmers in my constituency are being hit twice, because food is also more expensive to produce. Will my right hon. Friend confirm that he will continue to work closely with the retailers to ensure that, during this period of pressure, they give fair contracts and have good relationships with their suppliers?
Minister reply
My hon. Friend raises a fair point, but I point out that the farm-gate price of milk has risen by close to 30% so far this year, the price of lamb is at record levels, having just gone above £6 a kilo at the farm gate, and the same is true for beef. The price of cereals has doubled. The price of pork is also rising, partly because poultry and pork contracts tend to be linked to the cost of production. So farm-gate prices are also rising, but we recognise that farmers also have higher input costs.
Nick Smith
Lab
Blaenau Gwent and Rhymney
Question
The Government are at sixes and sevens on how to respond to the cost of living crisis. No. 10 is saying that Labour’s windfall tax idea is ideologically unconservative, although, of course, Margaret Thatcher had one. Will the Secretary of State go back to the Chancellor and demand a windfall tax to support families across our country?
Minister reply
The Chancellor is very familiar with all the arguments around the policy that the hon. Member mentions. I would simply say this: the Treasury is rightly concerned that, in an inflationary environment when prices are rising, we must be careful about borrowing and throwing more money at that or even increasing public spending in a way that could exacerbate the problem, so it is a difficult line to tread. That is what the Chancellor is considering as he looks at this issue.
Duncan Baker
Con
Isle of Wight
Question
Pensioners in the constituency are worried about rising food prices and pension values. Between March 2021 and March 2022, food prices rose by 6%. What conversations has the Secretary of State had with the Chancellor to ensure that the triple lock on pensions will return next year?
Minister reply
Mr Speaker, given the nature of these questions, this urgent question should ideally have been taken up by the Chancellor. The decision to temporarily change the triple lock was due to rapidly rising incomes, a matter for the Chancellor to address in future statements.
Joanna Cherry
SNP
Edinburgh South West
Question
Food banks and community pantry projects in Broomhouse are oversubscribed. The Secretary of State acknowledges this but what will he do about companies enjoying windfall profits from factors contributing to food price increases?
Minister reply
Specifically on food banks, the Department supports FareShare and other food charities that ensure supplies for food banks. Regarding taxation of windfall profits, it is a matter for the Chancellor at a future date.
Rochdale
Question
Ukraine's reduced grain exports due to geopolitical issues are affecting global food prices and inflation. What actions will the Government take to increase homegrown production of foods?
Minister reply
The UK has high self-sufficiency in wheat, producing 88% of its needs. The Government is mindful of impacts on countries importing from Ukraine, such as those in north Africa.
Hayes and Harlington
Question
In times of crisis, Governments have inflation-proofed benefits, pensions, wages, and looked at price controls. Will the Government now consider price controls for a basket of basic food items?
Minister reply
Retail competition is currently high with Sainsbury's and Tesco in a price match war with Aldi, which will help constrain prices more effectively than any regulation the Government can bring in.
Bob Blackman
Con
Harrow East
Question
Will the Minister take action to encourage farmers to produce more and ensure supermarkets pass on profits to farmers?
Minister reply
The Government have brought forward 50% of annual subsidy payments to July this year, helping farmers with cash flow during a difficult time.
Diana R. Johnson
Lab
Kingston upon Hull North and Cottingham
Question
In north Hull, demand at food banks is soaring due to rising food prices. What additional steps will the Government take to help people who are going hungry?
Minister reply
The funding in the household support fund has been doubled with an extra £500 million provided for this purpose.
Ben Lake
PC
Ceredigion Preseli
Question
Will the Minister speak with colleagues in the Treasury to ensure that rising food prices do not affect the provision of free school meals in Wales?
Minister reply
These matters are often covered by the Barnett formula and complexities of Treasury settlements with devolved Administrations, so the hon. Gentleman should write to the Chancellor or the Secretary of State for Wales.
Barnsley South
Question
Why do the Government not reconsider national insurance hikes, universal credit cuts, and a windfall tax on oil companies instead of telling people to work harder or buy cheaper?
Minister reply
These are matters for the Chancellor but the national insurance rise and social care levy bring in resources needed to help the NHS recover after the pandemic.
Ian Mearns
Lab
Durham
Question
Many food banks cannot cope with demand as donations are squeezed. The Government’s spending is not enough; what urgent action will be taken?
Minister reply
The Chancellor has increased spending on the household food budget, increased the national living wage, and put in place easements on council tax and energy bills.
Rachael Maskell
Lab Co-op
York Central
Question
Will the Secretary of State speak to the Secretary of State for Work and Pensions to ensure proper increases in social security and pensions so people can afford food?
Minister reply
The national living wage has been increased to £9.50 an hour, tax thresholds raised so that the poorest do not pay tax at all, and a package of measures put in place for those on low incomes.
Chi Onwurah
Lab
Newcastle upon Tyne Central and West
Question
Why does the Government protect windfall profits rather than working people who face higher rates of inflation and fewer choices?
Minister reply
The government has increased the national living wage to £9.50 an hour, consistently raised tax thresholds so that the poorest do not pay tax at all, and put in place a package of measures to help those on low incomes.
Barry Sheerman
Lab
Question
None of us came into this place thinking that we would see a day when children went to bed with no food in their tummy and no heat in their home. I know the Secretary of State to be an honourable man, but today’s statement does not show an understanding that this is a national and global emergency just like covid. There should be a Cabinet-level group—it could always be all-party—because this crisis is not going to go away. People are going to starve in this country and worldwide. We should have a programme to grow more, not just for us but for the whole world. Please, Minister, go back to the Cabinet, shake No. 10 up and get this moving.
Minister reply
Our domestic production of food is crucial to our national resilience and plays an important role in our overall food security, as do open markets around the world. We will be setting out a food strategy in June that will deal with many of these issues and will set out our ambition to expand agricultural output.
Jim Shannon
DUP
Strangford
Question
I thank the Secretary of State very much for his answers to the questions—he is obviously over his subject matter. In my constituency, milk went up by 25p in one week and since March of last year the price has risen by more than 25%. That is only one of the cupboard staples, and an essential element for future health. What steps can the Secretary of State take with regional counterparts to bring down prices and ensure that the farmer is supported and helped? Will he bring to the ears and attention of the Chancellor the need to halt the plastic packaging tax, which has increased production prices for dairymen across all the United Kingdom of Great Britain and Northern Ireland?
Minister reply
There have been so many questions for the Chancellor that I am sure by now he has tuned in and is listening to proceedings. In answer to the initial part of the hon. Gentleman’s question, the Government are removing the tariff that was introduced on United States feed maize so that we can reduce some of the input costs, particularly for the pig and poultry sector. That will also benefit dairy farmers.
Shadow Comment
Jim McMahon
Shadow Comment
The Secretary of State’s response is detached from reality, highlighting a cost-of-living crisis faced by working people. Despite rising food prices and other costs, the Government lacks meaningful interventions like addressing the closure of fertiliser plants and CO2 shortages impacting food production. The NHS, schools, and prisons face significant inflationary pressures on meals served annually. Working people are increasingly in poverty despite being employed, and many now rely permanently on food banks due to debt and rising living expenses. Jim McMahon calls for an urgent cross-Government commission involving industry and charity to address the impending food crisis before Christmas.
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