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08/01/07
The National Beef Association has asked David Milliband why
government does not believe retail price rises are needed to
counter the damaging impact of coupled subsidy removal on UK
farming – and on the beef sector in particular.
It is also looking for a straight answer from the Secretary
of State on whether government is encouraging supermarkets to sit
on food price inflation and keep retail prices for UK produced
food as low as possible.
And if government accepts that, because coupled subsidies were designed to make
cheap food available to the nation, their removal two years ago should mean speedy
compensatory adjustments in retail prices are both inevitable and necessary.
The move follows consistent reports from inside the food industry that government
frowns heavily at any suggestion of food price rises and repeated conjecture
within agriculture itself that government is deliberately sitting on retailers
so it can maintain low inflation levels.
“If this is true it is unacceptable because it means that government is
encouraging farmers to re-connect with the market at the same time as it interferes
with the value fixing process on which they depend for survival,” explained
NBA chairman, Duff Burrell.
“There can be no doubt that the subsidy system introduced after the last
World War was aimed at making sure there were ample supplies of cheap food for
the nation. Now this support system has been dismantled there should be an automatic
compensatory rise in retail prices but so far this has not happened and farmers
have been left, on their own, to continue to produce cheap food because there
has been no help from the market.”
“Over the last two years the National Beef Association has worked hard
to make sure that everyone connected with food and farming is aware of the need
for farmers to earn more market income so future production collapses can be
avoided.”
“During our talks with the food industry there has been repeated reference
to unrelenting government interest in low food price inflation and as a result
we have formed the conclusion it has a direct interest in maintaining low retail
prices which seriously contradicts its constant, post-decoupling, encouragement
to farmers to seek salvation from the open market”
“Last week we asked Mr Milliband directly whether the government is actively
discouraging retailers, who are sensitive to competition and profit level issues
and very keen to maintain a careful relationship with government, from meeting
the need to raise the retail value of profitless products like beef, and we are
very much looking forward to his reply,” Mr Burrell added.
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