07 July 1999
Milk Marque — What the papers say
By FWi staff
THE governments decision not to break up Milk Marques monopoly on selling milk is scrutinised by the five broadsheet newspapers today (Wednesday).
The decision “contrasts starkly” with the governments intention of removing political interference from monopoly and merger recommendations, says The Independent.
It describes the Monopolies and Mergers Commission (MMC) report as a damning catalogue of the way Milk Marque abuses its dominant position.
The papers Outlook column says the report “lists a stream of monopolist abuse by those loveable dairy farmers as long as your arm”.
It “rightly recommends [that] the co-operative under which they operate, Milk Marque, should be constrained and broken up”.
“This is about as awkward a finding as they come,” it adds, “guaranteed as it is further to alienate the farming community from the nasty townies who decide these things.”
Stephen Byers rejected that finding yesterday, saying that breaking up Milk Marque would take too long and would adversely affect too many farmers.
“Perhaps understandably, Mr Byers has ducked the decision and sent the ball scurrying off into the long grass,” says The Independent.
“Politically, this may have been the wise thing to do, but it doesnt say much for the chances of an independent competition authority.”
The Daily Telegraph reports that Mr Byers move to instead order radical reform of the milk-selling process sent “shock waves through the dairy farming industry”.
The move will have “serious financial implications for thousands of small dairy farmers,” it says.
The paper quotes Ben Gill, president of the National Farmers Union, saying that “the situation is extremely grave.”
Several “contradictory statements” in the report remained to be clarified, but Mr Gill welcomed the decision not to break up Milk Marque.
The Financial Times reports the story without a comment piece, saying that the Prime Ministers commitments to lower prices have been called into question.
Mr Byers “appears to have listened to warnings from Nick Brown, the agriculture minister, that the hard-pressed dairy sector would be further hit by a more competitive milk market,” it says.
The Guardian reports the story from the consumers point of view rather than focussing on the affect of the governments decision on farmers.
“Consumers are paying too much for their pinta because the milk industry is dominated by the main farmers cooperative,” says the paper.
But the paper says the government “stopped short of breaking up Milk Marque into smaller producer groups because of the effect it would have on struggling farms”.
The Times says that Mr Byers “trod warily over the MMC report like a civil servant on a days outing to a farm, fearful of stepping on a cowpat.
“Mr Byers is worried about causing farmers more distress, but other producers of commodities, such as coalminers … have been left to the mercy of the markets.”
The MMC wants to leave farmers and dairy processors free to compete, but it seems that the government wants to preserve a discredited institution, adds the paper.
“At long last, this government has found a union that is welcome in Downing Street,” concludes the paper.