department for Environment, Food and Rural Affairs

Jim Shannon Excerpts

Tuesday 17th July 2012 Commons Chamber

[Mr Hanson]

My hon. Friend and I have both been in the House since 1992 and I vividly remember the Milk Marque being abolished in the early 1990s, which led to a free-for-all that caused some difficulties. Let us put those issues to one side, however, as I am concerned about how we can make progress today.

The Minister has an opportunity to explain to the House how he is progressing on the voluntary code. If a voluntary code does not succeed, he will certainly have my support and that of my hon. Friends on the Front Bench, I think, for a statutory code in due course. The key issue, however, is how to ensure that those who produce get a fair price for their produce. At the moment, the big businesses mentioned by the hon. Member for Montgomeryshire in his opening remarks, such as Robert Wiseman, can squeeze my constituents to the extent that they cannot make a living out of the production of milk.

Much of the milk produced in my constituency does not go to retail in supermarkets; it goes into the production of butter, yoghurts, cheese and other produce. The code needs to encompass not just supermarkets but all outlets for milk.

[Jim Shannon (Strangford) (DUP)]

Does the right hon. Gentleman feel the same concern as many of us about the large investments that farmers have had to make because of the new regulations on slurry and its disposal? That investment, on top of a worse price for milk, makes it more difficult for them to survive.

[Mr Hanson]

The key point is that whatever challenges farmers face in their investment and their businesses, no business can take the type of change that has been imposed now with a 2p cut some months ago followed by a further 2p cut by August. That is being imposed by businesses that are choosing to do so to enable supermarkets to have loss leaders. Customers can have cheaper milk, which must be welcomed in some ways, but ultimately we need a fair deal for all. We need a fair deal for producers, for supermarkets and for those people who buy and transport milk and make it into other products. At the moment, that is not happening because, as the hon. Member for Burton (Andrew Griffiths) said, the inflexibility of contracts means that farmers cannot get out of them.

We need an update from the Minister on the review of the contracts and an examination of how we can ensure long-term stability for milk production. We need the voluntary examination of contracting and, if that fails, we need the Government to take regulatory action to ensure that the interests of all parties in this important industry, not just in my area of north Wales but throughout the United Kingdom, are defended.

Finally, will the Minister update us on his discussions with my colleagues in the National Assembly for Wales? They have a devolved responsibility for some aspects of dairy production but contracting legislation must be dealt with on a UK-wide basis to ensure that markets are not further distorted between England, Wales, Scotland and Northern Ireland. I support what the hon. Member for Montgomeryshire wants to see, which the hon. Member for Brecon and Radnorshire (Roger Williams) will no doubt comment on in a moment.