Dairy Farming

I thank my hon. Friend for raising that matter. The hon. Member for Preseli Pembrokeshire made a fair point when he said that the ombudsman will not be the solution to all problems, but expectations are high. If this is to be an ombudsman without teeth, it will be costly lip service and will fail at the first hurdle. We have a job of communication to do with our constituents. When Mr. and Mrs. Average go into a supermarket and purchase their milk for a couple of days, only a tiny share of that milk price actually finds its way to the producers. Prices may have gone up a bit, but they have still been low over the past couple of years. They have gone up from 18p a litre to 23p. People do not understand—the farmers understand—why a greater share of the price is not finding its way back to the farmer. This is about not just the supermarkets and the monopolistic control that they exercise, but the relationship with the processors, which needs to be considered as well. NFU Scotland says that there has been evidence of some upward movement on prices paid by processors, but given the increased profits of the likes of Wiseman's, Arla and Dairy Crest, it is disappointing that the rise has not been steeper. Figures from DairyCo show that, between February and October last year, the price of bulk cream rose from £750 a tonne to £1,700. It has slipped back now to £1,130. There is still a feeling that not enough of that money is finding its way back to the producers. The purchasing power of supermarkets is a fundamental concern. Again, I welcome the announcement that the ombudsman issue is to move forward. Some supermarkets treat farmers more fairly than others and they should be rewarded for their support by not allowing others to cut corners, thereby restricting the ability of producers to make a living. Some contracts are linked to production costs. Those are welcome and contribute to keeping farmers in business, but much more needs to be done. One of the first jobs of the ombudsman is to establish whether the price of milk has been kept artificially low, which is what we suspect.