§ 64. Mr. Banfield
asked the Parliamentary Secretary to the Ministry of Food whether he has considered the difficulties which may arise as a consequence of the almost total withdrawal of the subsidy to the 23,723 small producers of bread in England and Wales; and, in view of the importance of a widely-distributed system of bread production, which must not be made uneconomic to the producer, will he undertake to review within a reasonable time the effects of the abolition of the subsidy on the small producer?
§ Mr. Mabane
All bakers receive a subsidy of 7s. 9d. per sack. This subsidy remains. The only subsidy which has been withdrawn is the temporary additional subsidy which was granted last October 1977 at rates varying from 4s. to 2s. per sack. The continuation of this additional subsidy was dependent upon the results of an inquiry into the cost of manufacturing and distributing bread. The inquiry has now been completed for England and Wales, and a careful examination of the figures shows that bakers as a whole would receive an adequate return on bread without the additional subsidy. Appreciating the special difficulty of small producers, my Noble Friend has decided to pay 2s. per sack on the first eight sacks of weekly output for a further short period, and to collect data as to costs in a week in July. The reply to the last part of my hon. Friend's Question is in the affirmative.
§ Mr. Banfield
Will the hon. Gentleman bear in mind that it is true that large bakers do not require any further subsidy; but that he is paying this 2s. to large bakers, who do not want it, and to small bakers, to whom it is a tremendous help, enabling them to keep their businesses going?
§ Mr. Mabane
It is important to bear in mind that a costings examination was made by an accountant of the Department and an accountant appointed by the bakers. That examination showed that there is no justification for the subsidy, but, in deference to further representations, this subsidy is being continued in this form until further costings can be obtained.