Cost of Living Increases

Deidre Brock Excerpts

Wednesday 16th March 2022 Commons Chamber

[Deidre Brock (Edinburgh North and Leith) (SNP)]

Many of the issues around the cost of living that we have heard about in the debate are underpinned by food security, which is what I will focus on. Before I expand on that, however, I reiterate that the people of Ukraine are at the forefront of our thoughts and discussions at this time. Their lives have been devastated by the horrors of war and they must remain uppermost in our minds as we reflect on any potential impact of the conflict on daily life here.

Hon. Members have previously touched on the anticipated consequences of the war on the global economy, including on food prices. Russia and Ukraine are the world’s largest and fifth largest wheat exporters respectively, and the two countries are major suppliers of critical fertiliser components. We must realise that the consequences of that hit to the supply chain are likely to be felt severely in sub-Saharan Africa and places already struggling with hunger such as Afghanistan, Syria and Yemen. We must be ready to help those regions of the world most affected by a potential global food emergency.

Those global shortages will lead to rising food prices in the UK too. The EU is moving quickly on measures to support farming and businesses, and there is concern in agriculture that the UK will not replicate or work in parallel with that. Of course, millions of households across the UK were already seeing their food bills escalate long before the crisis in Ukraine. Shop price inflation leapt between January and February this year to the highest inflation rate recorded since November 2011.

The Resolution Foundation has warned that rising food and energy prices could cause a “second peak” in inflation of above 8% in the autumn. It is our most vulnerable constituents who will be hardest hit, experiencing an inflation rate of as much as 10% due to their spending a higher proportion of their household budget on food and fuel.

The agricultural industry forecasts difficult conditions in the global fertiliser market, where the UK is a much smaller player with less leverage after Brexit. If, as looks almost certain, the resultant higher costs mean that yields are reduced, that too will have an impact on food security and take a further toll on the cost of living. Farmers are facing a perfect storm, with prices for fertiliser, fuel, energy and feed rocketing. The sector in Scotland has raised the alarm about the far-reaching implications for markets, processors and abattoirs, and ultimately rising prices in supermarkets for consumers. A post-Brexit shortage of both permanent and seasonal workers, combined with a lack of haulage drivers and processing staff, has put serious strain on agriculture and food and drink businesses across Scotland. Meanwhile, the UK Government have reneged on promises to replace fully our former EU funding.

On top of all that, the Scottish and UK farming sector is being exposed to real, lasting harm by the UK Government’s hurried and poorly conceived trade deals. The Department for International Trade’s own analysis of the deal with New Zealand euphemistically described an expected loss of £150 million to fishing, agriculture and food-related sectors as just a “process of economic adjustment”. Organisations such as the National Farmers Union of Scotland have consistently warned about food security issues in relation to that—indeed, it issued a press release on that very subject today—but have been repeatedly ignored or dismissed by the UK Government.

At Department for Environment, Food and Rural Affairs questions last week, the Secretary of State and the Minister for Farming, Fisheries and Food claimed that the UK is largely self-sufficient in its food production. However, the Government’s own analysis of food security shows that, by economic value, the UK produces only about 60% of food consumed domestically, and actual consumption of UK-produced food is closer to 54%, as a part of it is exported. In terms of historical, long-term trends, there is a concerning drop in the domestic supply ratio of fresh vegetables, from 76% in 1990 to 54% in 2020.

We need to ramp up domestic food production, but the planting window to do that is narrowing. The UK can do more to service the domestic market in cereals and spring barley, for example, but there is a risk of missing out if the EU acts faster and much of that services Europe instead. If offers come in from France or Germany to service spring cropping, businesses will take them.

We must keep things in perspective and do everything possible to assist with the humanitarian crisis in Ukraine, where there are reports of farmers being unable to go out into their fields for fear of bombardment, but the UK Government clearly need to take food security here much more seriously and take action now to address the immediate risks to domestic food production. We remain vulnerable if we are too reliant on imports, and it is people on the lowest incomes who will suffer the most.

Some of the people I am angriest with are the Brexiteers. The snake oil salespeople blithely assured all of us who warned them about the problems of over-dependence on imported foods—we said this Government were making it impossible for many farmers and others in our food industries—that all would be well in the golden land of Brexitania. They are now truly reaping what they have sown, are they not? The trouble is that all the other countries around the world who have also been relying on Ukraine—that golden breadbasket of the world—and Russia to supply their needs are out there alongside us, hunting on the trade markets for deals on the rice, wheat, maize, nuts, fruits and oils that we have all been receiving up to now. When goods are in short supply, prices go up. We must recognise and face with clear eyes the food security problems that there will be for the most vulnerable among us on these isles.