asked the Minister of Food the, percentage basis on which the gross profit of grocers is calculated for purposes of fixing the retail price of foodstuffs, and for which a part of the £400,000,000 annual subsidy for food is allocated.

Margins for the different commodities handled by grocers vary with the circumstances of each commodity and accordingly no over-all fixed percentage basis is used in arriving at grocers' gross profit margins.

Does the hon. Lady consider that it is still appropriate to work out the gross profit on something approaching 33⅓ when the prewar basis was somewhere around only 12 to 15 per cent. and could she review this whole basis because it appears that grocers are being subsidised out of public money?

My hon. Friend must realise that we cannot work out these things on terms of over-all gross profit. When one is working out a margin for a commodity one has to think of other factors. If my hon. Friend will visit a grocer's shop he will find that it is much easier to serve a tin of fruit than it is to serve cheese and bacon which have to be weighed and wrapped.

Is the hon. Lady aware that the 33⅓ per cent. profit which has been mentioned does not apply at all to wholesale grocers who, since salaries were increased under the J.I.C. award, have had such a small profit margin that they have been unable to pay their way?

I think the hon. Gentleman has also been misinformed.

It can be seen from the balance sheets.

I think that the gross profit of master grocers is in the region of 16 per cent. and that of multiple grocers 18 or 19 per cent.

May I ask the Parliamentary Secretary whether—whilst admitting that many retail grocers obtain margins to which they have never been entitled by comparison with prewar figures—it is not fairly true to say that the £400 million referred to affects not the retail grocers in the main but various producing industries who never should receive a subsidy?

I am afraid I could not confirm what my hon. Friend has stated.