MILK MARKETING

Evening Post, Issue 37, 12 August 1936, Page 11

MILK MARKETING

CABINET NOT AGREED

DEMAND FOR IMPORT

LEVIES

(From "The Post's" Representative.) LONDON, July 4. Home dairy farmers, bitterly disappointed at the fact that a fall in milk prices, instead of a rise, has followed the organisation of the industry Under the Milk Marketing Scheme, are making insistent demands for a levy on all dairy imports to bolster up their' declining returns. But their claims are being effectively refuted. The imposition of a levy was strongly urged by Mr. T. Baxter, chairman of the Milk Marketing Board, at the board's annual meeting the other day. "We regard it as indispensable to the marketing of a commodity subject to such immense overseas competition," he said, "that a policy of a levy-subsidy should be implemented. The Government, we understand, is already committed to this policy, and with the increasing quantities of imported dairy products at low prices, there is no better alternative than to collect by means of a small levy on imported produce a substantial sum to assist the industry at home. "The Milk Act at present in operation will terminate in September, ,1937, and it is expected that as from that date the levy-subsidy principle will operate. Money raised in this way should not be confined to assisting manufacturing milk, but should be available to enable us, in co-operation with the Government, to provide schemes to give liquid milk in abundance to the poorer classes. In this way the milk industry could be wedded to a policy of better nutrition of the people." Asked to confirm Mr. Baxter's claim, the Minister of Agriculture (Mr. Walter Elliot) referred this week to a statement he made on July 25, 1935, when he said: "The Government is of the opinion that assistance to the milk industry could best be afforded by a system of duties or levies. . . In accordance with the Ottawa Agreements, the incidence of any duty or levy upon foreign and Empire supplies respectively would be so adjusted as to maintain the existing preferential margin." OPPOSITION IN CABINET. But there are signs that while Mr. Elliot and the Milk Board still cling to the levy-subsidy idea, general Government opinion is rapidly changing as lo its probable effectiveness or advisability. The Cabinet and the Conservative Party, it is reported, are seriously divided on the proposal, particularly in regard to its repercussions on Empire trade, shipping, and good will, and its restrictive effect on the nation's food supplies. The Opposition parties are, of course, strongly opposed to any further taxes on food imports. The argument that a levy subsidy would intensify rather than remedy the "milk muddle" is effectively developed by Mr. H. Leslie Boyce, Conservative M.P. for Gloucester, in a letter to the "Morning Post." Mr. Boyce (who is an Australian) says: "A review of the situation'since the Milk Marketing Board began its operations shows that whereas the price of Empire butter and cheese has risen roughly by 30 per cent, between May, 1934, and May, 1936 (and the official cheese-milk price has increased in sympathy roughly from 34d to 4£d per lb), the price paid to home farmers producing under contract has fallen in that period from lOd to B.Bd a gallon. : " : "It cannot, therefore, be seriously contended that there is any real connection between the price of Empire butter and cheese and the ultimate price received by, the Home farmer, who must always depend chiefly on his liquid milk monopoly. "The fall in milk prices is explained by the fact that the Milk Marketing Scheme has brought 12,000 more home farmers into the sphere of milk production and increased our milk output by over 70,000,000 gallons, while there has been a complete failure to increase liquid milk consumption. Consequently, the milk surplus has enormously increased and the average price received by the farmer has declined, notwithstanding the rise in the value of milk manufactures "UNBLUSHING BRIGANDAGE." "In my view, if the Government was to allow itself to be stampeded by the more short-sighted British agriculturist into such an act of unblushing brigandage as to impose a levy on Dominion producers, and put it into the pocket of the Home farmer, it would bring a host of fresh producers into the milk market, further stimulate production', ' and result in utter chaos. Personally, I do -not believe that the Government will adopt so unwise a course. '"There can be no permanent improvement in the position of the ;Home dairy farmer until those responsible for marketing his produce realise that liquid milk consumption must be increased, either by intensive educational effort or by lowering the price to the consumer—or ppssibly both." . All things considered, it appears extremely doubtful whether Mr. Elliot and his farmers will have their way with levies on Dominion dairy imports —particularly in view of current Press statements that the Government has abandoned its intention to tax Empire meat, though it will impose a levy on foreign produce. '■