Food Prices and Food Poverty

Baroness Primarolo Excerpts

Monday 23rd January 2012 Commons Chamber

[Mr Jim Cunningham (Coventry South) (Lab)]

I know that my hon. Friend, like me, comes from Coventry. Would she be surprised to learn that 35,000 children from Coventry and Warwickshire will now be on the poverty line, and does she think that that is an indictment of this Government’s failed policies? More importantly, many families are now struggling with electricity prices, heating bills and so on, which is feeding through—

[Madam Deputy Speaker (Dawn Primarolo)]

Order. Interventions must be brief, as we are in a short debate with time limits on speeches.

[Mary Creagh]

I am very sorry to hear that my home city of Coventry has 35,000 children living in poverty. I am sure the number was similar when I was growing up there in the 1970s and 1980s and I am only sorry that much of the good work we did in government is falling away and poverty is increasing.

FareShare, which operates nationwide and works to redistribute aid from the food industry to charities, says demand is growing faster than supply. I pay tribute to both Sainsbury’s and Brakes, which recycle their in-date surplus to FareShare. It is important that the food is in-date so that there is no risk associated with that food, which includes fresh vegetables and, in particular, meat. Supermarkets could be doing much more to recycle food waste to hungry people. FareShare estimates it gets 1% of supermarket food waste, which prompts the question of where the other 99% is going. More of it should be recycled to hungry children in this country, which is one of the richest on earth. We can learn from food businesses such as Pret A Manger, which delivers surplus sandwiches around its London stores in the evening. We recall with horror the Tory proposals from Westminster council last year, when it wanted to make food distribution illegal. I pay tribute to all those who fought that proposal and protected people’s basic human right to a square meal even in the city of Westminster.

Gareth said that food is at the heart of everything his organisation does, but as my hon. Friend the Member for Bridgend (Mrs Moon) said, charities are tackling a complex web of abuse, abandonment by the breadwinner, debt, unemployment, non-payment of benefits and other equally serious issues such as house fires, which she mentioned.

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[Andrew George (St Ives) (LD)]

I note that the motion expresses dismay at the Government’s delay, yet it asks for the groceries code adjudicator to be introduced in the next Parliament, rather than in the next parliamentary year, which I assume is a drafting error. Leaving that aside, given the fact that the first Competition Commission report was in 2000, and the Competition Commission report to which the hon. Lady refers was completed in 2008, what word other than “dismay” would she use to describe the Labour Government’s response to that report?

[Madam Deputy Speaker (Dawn Primarolo)]

Order. May I remind everyone in the Chamber that the debate ends at 7 pm? There is already a time limit of eight minutes on Back-Bench speeches. Interventions should therefore be short, and I hope opening speeches will not be overly long.

[Mary Creagh]

I quote back to the hon. Member for St Ives (Andrew George):

“Every week the government fails to act, farmers are finding themselves in more difficulty.”

That is what he said. The supermarkets were insistent. We wanted an ombudsman. The supermarkets asked for a voluntary approach. It is right to try a voluntary approach first, which we did, but it did not work. This is the anti-regulation Government, but that approach failed. What we need now is action from his Government.

The commission recommended the powers to levy significant financial penalties, but the Government are recommending that only in reserve powers in the Bill, not on the face of the Bill, meaning that fines for anti-competitive practices are even further away than 2015. The Financial Times quoted an executive of a large supermarket chain saying that

“it is an adjudicator rather than an ombudsman, which suggests that it is a watered-down role.”

Suppliers can complain anonymously, but they are liable for full cost recovery if the adjudicator finds that the complaint was vexatious or wholly without merit. The Business, Innovation and Skills Committee recommended that whistleblowing from within retailers should also be grounds for launching an investigation, which BIS Ministers are currently considering.

Consider this anonymous salad grower who works with the Food and Drink Federation:

“X”—

the name of a supermarket—

“have expected us to support their current pricing campaign in store by contributing with reduced price returns, to maintain their margin demands. It has been made very clear that lack of support could be seen as showing no commitment to”—

the supermarket—

“and the potential loss of business, forcing us to drop our prices and support the activity. Interestingly none of this has been put in writing.”

This suggests anti-competitive practices across the sector. If there is bad treatment at the top of the pyramid, that sets the tone for treatment all the way down the food chain, right down to the workers in the field. What we want is culture change across the food industry.

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[Kwasi Kwarteng (Spelthorne) (Con)]

Will my right hon. Friend comment on the moves that the Government are making, such as freezing council tax and cutting fuel duty? That has made general inflation a much more manageable phenomenon for ordinary families.

[Madam Deputy Speaker (Dawn Primarolo)]

Not at this precise point; the right hon. Lady is speaking to the motion.

[Mrs Spelman]

That is a shame, Madam Deputy Speaker, because there is a long list of things relevant to household budgets; there was a wider definition of that earlier. Freezing council tax is but one example of what frees up the budget to buy more food.

Last year, the Government’s Foresight report on the future of food and farming concluded that Governments across the world must take action now to ensure that a rising global population can be fed. It is a chilling fact that in only 13 years there will be 1 billion more mouths to feed on this planet. Increasing demand for water, land and energy means that food security is one of the world’s greatest challenges. The report identified five challenges for all nations to act on: balancing future demand and supply; ensuring that there is adequate food price stability and protecting the most vulnerable from volatility; achieving global access to food and ending hunger; managing the contribution of the food system to mitigating climate change; and maintaining biodiversity in our ecosystems. To take on those challenges, we need international reform. To address global food security, we need an increase in agricultural productivity, which means a move away from subsidy. To address the risk of climate instability disrupting production patterns, we must have open world trading systems.

In June last year, G20 Agriculture Ministers met and agreed to the creation of an agricultural market information system, which aims to stabilise food price volatility through better transparency in the marketplace. In November, I attended the climate change conference and helped the South African Agriculture Minister to get agriculture included in the work stream for the next climate change convention. We are now preparing for Rio plus 20, where we will push for international policies to help the most vulnerable in our society. We will lobby for the sustainable intensification of agriculture, climate-smart agriculture and the reduction of post-harvest losses. The Afghan Minister whom I met in Berlin this weekend at green week said that the reduction of harvest losses would make one of the greatest contributions to combating famine.

The challenges present an opportunity for the UK, and we need to be the first out of the blocks and embrace it. British food producers must make the most of international markets. That is why I have announced that I will publish an action plan at the end of the month to help export the best of British food and drink across the world. It is through global trade that the UK can secure its future food supply and help keep food prices down. We already contribute to global food supply. We provide 2% of global wheat exports, 4% of global barley exports and 1% of global cereal exports. That demonstrates that the UK has a major role in food production. By expanding production and exports, we can contribute to the overall economic recovery.

The food and farming industry is a high performer with great potential. The food chain contributes £88 billion per annum to the economy, which is 7% of GDP. It is responsible for 3.7 million jobs. The Government are acting across the food chain to stimulate growth, facilitate international trade and drive fair competition, because a thriving and competitive economy, where our products are freely traded on an international market, will deliver resilient, stable and affordable food supplies to our consumers.

The Government are working with industry and environmental partners to see how we can reconcile our goals of improving environmental protection and increasing food production. I am grateful to the hon. Member for Wakefield for welcoming the green food project. The Government are spending £400 million on food and farming research, which addresses productivity, environmental performance and resilience along the food chain.

Nobody is under any illusion about the pressures that high food prices put on all our constituents. However, it would be wrong to pretend that there is a “silver bullet” solution when there is not.

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[Laura Sandys]

I totally agree with my hon. Friend. It is pretty frightening that wheat yields in this country have not increased at all over the past 20 years. Also, because food has been so cheap in this country, we have not valued it. As a result, there is a huge amount of waste in the system.

It is interesting that the Opposition have chosen this subject for debate, because you left this country very vulnerable—

[Madam Deputy Speaker (Dawn Primarolo)]

Order. That is the second time the hon. Lady has done this. She is not to refer to the Chair in that way. I have not done anything. She should refer to “the hon. Lady”. I certainly have nothing to do with fruit of any kind.

[Laura Sandys]

I do apologise, Madam Deputy Speaker.

To address the bigger problem of food insecurity, we should look to the energy model. This Government’s strategy on energy insecurity aims to manage a valuable resource, to address the waste in the system and to build greater UK resilience to international price fluctuations. With some tweaks, several of those policy mechanisms could and should be adopted for food. Security of supply is an example. The previous Government cannot claim much credit in that area. Imports of food increased by 52% under the previous Government and agricultural land was diverted away from production. Thank goodness, today we have Ministers who understand the issues of production.

To build greater security of supply, domestic production must, in my view, increase. We must build a hedging mechanism against global volatility and realise not only that food imports will become more expensive but that the level of imports, with a weak pound, is having a negative impact on our balance of payments and placing inflationary pressure on benefits and entitlements.

We must address food waste with a similar tenacity to that with which we are addressing energy waste through the green deal. We need to reverse the indulgent years that deskilled the consumer in food preparation and supported profligacy in the supply chain. Customers—we, the consumers—are often accused of being responsible for such waste, but I disagree. The system is designed to create waste and the consumer is merely responding to how the supermarkets and other retailers sell their products. The waste in procurement is terrifying and I hope that the grocery code of practice will ensure that we reduce some of it. As I have mentioned before, my campaign through Ugly Food is one way of addressing some of the waste embedded in our system.

Waste is also embedded in the design of consumer-facing products. The hon. Member for Stoke-on-Trent South (Robert Flello) talked about the packaging and presentation of food. People blame the customer, but is it their fault? Servings of food are often too big and processed foods are heavily advertised. Although the Government have made a great deal of progress on display dates, safety dates mislead the consumer about the longevity of products. Point-of-sale displays draw consumers to larger packages rather than smaller units of food and BOGOFs—buy one, get one free offers—neither help single item shoppers nor reduce the bills for family shoppers.