Oral Answers to Questions

Jessica Morden Excerpts

Thursday 7th July 2016 Commons Chamber

[Elizabeth Truss]

I can tell my hon. Friend that 99.6% of farmers have now received a payment. This year, for the first time, the system has had prepayment cheques to make sure that we did not overpay farmers and then end up having to claw back the money. That means that there will be a reconciliation period when we make the adjustments—that is taking place at the moment—so that farmers who had a problem in their application will receive the extra payment over the next few months. We are fully on track for payment on time next year.

[Jessica Morden (Newport East) (Lab)]

11. What assessment she has made of recent trends in food prices.

[The Minister of State, Department for Environment, Food and Rural Affairs (George Eustice)]

DEFRA monitors retail food prices through the consumer prices index. Year on year, food prices have continued to fall, with a 2.8% fall in the year to May 2016. We also monitor trends in household expenditure on food through the family food survey. Following a period of higher food price inflation, retail food prices have fallen by 7% since their peak in February 2014.

[Jessica Morden]

Last week I visited a very successful food supplier in my constituency that told me that it was already putting up its prices because of changes in the exchange rate hitting imports, and predicted food inflation of up to 8% within months, following the leave vote. Clearly there are real impacts now. How will the Minister respond to a spike in UK food prices, which is a crucial issue for consumers?

[George Eustice]

As I explained earlier, one of the factors that has an influence on food prices is exchange rates. A number of analysts have been saying that in fact the pound has been unsustainably high against the euro for some time, caused by concerns about the weaknesses of the eurozone, and that the correction we have seen was overdue anyway. Exchange rates go up and down, but the crucial thing is that we have a competitive food supply industry in this country.