The Government has issued a noncommittal response to a petition calling for the introduction of minimum prices for milk. It states:
“Britain’s dairy industry is our biggest farming sector and recent farm gate milk price cuts have been a severe blow to the industry. However, we are part of a single market across Europe and as such we cannot and should not dictate what a fair price is for farmers and consumers.
To provide some relief to hard-pressed farmers we secured a £26.6m aid package for the UK from the European Commission – the third largest of all Member States. Dairy farmers across the UK are being paid a one-off, flat rate payment linked to milk production. The majority of payments were made by the RPA on 16 November.
Plans on how to roll out a fairer tax system for farmers were published in July 2015 as part of the Budget. The new system will come into force from April 2016. It will allow our farmers to average their profits for income tax purposes over 5 years to help address price volatility.”
Their response comes just as dairy farmers across the EU are protesting at milk prices falling below the cost of production. With a difficult winter ahead for many dairy farmers, the government’s short term solution to endemic market failures may be proved inadequate sooner rather than later.