Report spells end for milk subsidies

Dairy industry representatives are to hold an industry wide summit on Tuesday (17 January) to discuss fears that the government may end school milk support, worth about 1.5m a year.

Established in the 1970s the EU subsidised School Milk Scheme provides funding for the provision of up to 250ml a day of whole or semi-skimmed milk to pupils in primary education (five-11-year-olds).

Dairy UK estimates that about 1.3m primary school children benefit from the scheme.

The EU subsidy is worth about 2.7p/189ml serving of whole milk. Since 2001 the government has added an additional 0.75p “top-up” at a cost of about 1.5m.

The extra subsidy – which was introduced to alleviate the impact of a reduction in the EU subsidy – has helped increase milk consumption in schools by over 3m litres from 2000/01 – 2003/04 with the UK climbing to the top the league table for subsidised school milk provision ahead of both France and Germany.

However, a report from economic consultants London Economics, to be considered by DEFRA and the departments for Health and Education, claims the “top-up” subsidy, paid to 12,000 schools in England, is inefficient and could be better directed.

A London Economics survey carried out for the report found that at schools participating in the scheme a child’s milk consumption rise, on average, by 0.1 pints a day.

However, the average milk consumption of pupils in schools not partaking in the scheme was already 0.76 pints a day.

Furthermore, financial inefficiencies in administering the scheme made subsidised milk more expensive than unsubsidised milk on sale in supermarkets – the government top-up alone creates 804,000 in extra costs, equivalent to 57% of the funds spent.

The total administrative costs for the EU subsidy and the top-up equate to 82% of the total subsidy, concluded London Economics.

Jim Begg, director general of Dairy UK, said: “This subsidy is highly valued by parents, teachers and schools as a method of delivering the nutritional benefits of milk to children.

“It is therefore paramount that all members of the dairy industry collaborate in a bid to establish a uniformed industry response showing solidarity on the issue.”

The summit will take place at Dairy UK’s London headquarters at 12.30pm.