Local MP and AM condemn the behaviour of HSBC towards Dairy Farmers

June 18, 2009 11:56 AM

The collapse of Dairy Farmers in Britain which went into receivership earlier in June is continuing to create real hardship for farmers in Montgomeryshire.

The Government is involved in negotiations to find a buyer for the firm, and the Welsh Liberal Democrats are also urging the Government to underwrite the lost May milk cheques for affected farmers.

Furthermore, Lembit Opik and Mick Bates, Liberal Democrat MP and AM for Montgomeryshire respectively, are calling on HSBC, whose actions sent the group into receivership, to pay the lost May milk cheques to affected farmers.

Commenting, Lembit Opik, Liberal Democrat MP for Montgomeryshire, said: "This is an incredibly important issue for farmers in the more remote rural areas, where milk is harder to sell without the support of this cooperative.

"I am extremely disappointed by the actions of HSBC in allowing this cooperative, which supports 10% of milk production in the UK, to trade itself into difficulty..

"I welcome assurances from the UK Government that they are involved in the negotiations to find a buyer for the group but I am urging more action in both better regulating the banks that are supporting businesses and underwriting the lost May milk cheques for farmers. This has been an incredibly difficult few months for dairy farmers, with pressure from both the banks and their clients who are forcing them to sell milk below cost price. They need action now, and fast."

Adding to this, Mick Bates AM for Montgomeryshire, said:

"I am deeply concerned over the level of intelligence received by the Welsh Government on the state of the dairy sector in Wales. Since New Year the dairy industry in Wales has been on its knees since the price paid to farmers for their milk was slashed. It is vital that the Welsh Government learns from this and takes heed of warnings from the industry and colleagues so that the dairy sector in Wales does not face further collapse in the future.

"Ensuring viability and sustainability for Welsh co-operative farmers who put their faith in the Dairy Farmers of Britain is now crucial. Farmers are worried about their milk cheque and need reassurance that the industry will remain profitable and that they will be able to recover any money lost from this crash. I have written to HSBC to question their role as the bank behind Dairy Farmers of Britain and have urged them to take action to ensure that the milk cheques for May are paid and farmers are not left out of pocket."

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