First Milk chairman Sir Jim Paice has resigned from his role as the co-operative slashed another 1p a litre paid to farmers.
Sir Jim, who previously served as Defra farm minister at the peak of the last milk price crash in 2012, said the board of the group “needs more people with real commercial and business skills”, adding that the further price cut was a matter of “regret”.
Sir Jim said he will remain with the business until a new chairman is found.
Recently it emerged the former Conservative minister was paid £1,800 a day to sit on the company board as chairman as the co-operative faced fire from Scottish ministers for delaying payments to farmers.
The cut announced this morning will affect “A” suppliers after the firm revealed it would introduce a new two level pricing scheme from April 1. It said that produce from its Midlands Balancing pool would see a 0.7p a litre reduction. The new prices come into effect from July 1.
The Glasgow-headquartered farmers’ co-operative has been at the centre of the current dairy crisis, which resulted in the Press and Journal launching a campaign to help beleaguered dairy farmers.
Bosses were called to Holyrood to be quizzed by the rural affairs committee in May.
In January First Milk was forced to delay payments to farmers after revealing it was suffering from cash-flow problems. It also asked members to increase their capital payments into the co-operative to keep it afloat.
Sir Jim said last night: “As you will be aware from recent milk price announcements around the globe, commodity markets are continuing to decline. While the turnaround actions that have been taken over the last two months have improved our trading position, we also have to factor in the impact of lower commodity prices. I know this is further disappointing news, which I regret.
“With the turnaround programme now gathering pace and the timescales for an external review agreed, I believe the time is right to announce my intention to step down as chairman of First Milk.
“In my letter last week I said that I believe the board needs more people with real commercial and business skills. That means I think there has to be significant change in the constitution of the board, and that includes the chairman role.
“Signalling my intention to stand down allows the board to immediately start work on scoping out the personal and professional qualities that they require in a new chairman, and initiating a recruitment process. In order to ensure an appropriate transition, I will stay in role until a smooth handover to a new chairman is achieved.”