Dairy Industry

Baroness Hayter of Kentish Town Excerpts

Thursday 17th September 2015 Lords Chamber

[Baroness Hayter of Kentish Town (Lab)]

My Lords, in thanking the noble Earl, Lord Shrewsbury, for his kind words about my noble friend Lord Grantchester, who is himself a farmer, I am delighted on this occasion to stand in his shoes as the shadow Consumer Minister, because, of course, this affects consumers where, in this case, our interests align with those of farmers. The Opposition firmly believe that farmers should get a fair deal for their milk. We have heard of the crisis facing the industry—the source of a very healthy and to me highly enjoyable product. Higher milk production and the action of wholesale purchases has led to farm gate prices falling below average production costs. That is untenable.

We support the dairy industry’s voluntary code of practice, but want to see it adopted by the entire industry. Milk producers need improved bargaining power. At the moment, they are outmanoeuvred by the supermarkets engaging in price wars, with milk simply used as a weapon. That is bad for farmers, but also bad for consumers, who see a message that milk is a mere marketing tool. We need to see British milk on supermarket shelves—yes, at prices which encourage consumers to buy it in preference to unhealthy fizzy drinks, but not purchased from farmers at prices which force them out of business.

So we would also like to see a tough new supermarket watchdog that can look across the supply chain by expanding the powers of the Groceries Code Adjudicator and protect food producers from unfair practices by the major supermarkets. The GCA covers only a narrow part of the supply chain between supermarkets and suppliers at the moment. Indeed, its head told the House of Lords that it could not get suppliers to produce evidence of breaches of the code, perhaps fearing retribution from big supermarkets. Will the Government support the calls made here today and earlier to extend the remit and powers of the GCA?

The UK nursery milk scheme gives children under five at an educational setting one-third of a pint of milk free a day, which I remember from my own youth, providing farmers with a ready market and helping to form life-long healthy diets. Under the EU school milk scheme, which we have heard about, children over five get subsidised milk. The EU is discussing reforms to the scheme, and the School & Nursery Milk Alliance has called on the Government to seize this opportunity to deliver the maximum benefits for schoolchildren and the dairy industry. Will the Minister clarify whether his department will continue claiming the subsidies from the European school milk scheme after the proposed changes? What discussions has he or his department had with the dairy industry about how it can benefit from the European school milk scheme? Perhaps he could also update us on plans for labelling of milk and milk products.

As the right reverend Prelate the Bishop of St Albans said, we cannot keep those cows tucked away in case we need them. This needs good action by the Government, and we will support them to help not just farmers but consumers so that we continue to get the milk, which is good for all of us, at a price good for consumers but also for the dairy industry.