HC Deb 21 September 1939 vol 351 cc1067-70
Mr. Shinwell

(by Private Notice) asked the President of the Board of Trade whether he is now in a position to make a statement on the subject of prices and the prevention of profiteering?

The President of the Board of Trade (Mr. Oliver Stanley)

I must apologise to the House for the length of this answer.

Numerous instances have been brought to my notice, where the prices of various classes of goods have recently been raised; and immediate inquiry has been made. It is recognised that there are a number of cases where owing to various unavoidable causes such as the fall in sterling, the rise in world prices, difficulties of transport, war risk insurance and expenditure on air raid protection, there has been an increase in the cost of manufacture. It is, however, essential that even in such cases where some increase in prices may be justifiable and even inevitable the increase should be as small as possible and I am glad to say that I know a number of instances where firms are, in the national interest, not only strictly limiting any increase in price but even refraiing from making increases where they could be justified by a corresponding increase in cost. I am confident that this represents the attitude of the great majority of manufacturers and traders throughout the country.

On the other hand, I have evidence of cases where the increase of price would appear to bear little relation to any increase in cost. In particular, compulsory expenditure on war risk insurance and on air-raid protection has been made the excuse for price increases far exceeding these costs, if calculated on any reasonable basis. Such action is unfair to the community, harmful to the national cause and must be stopped.

To this end, in some cases, particularly in food stuffs, systems of price control have already been introduced: they form the most effective check to the activity of the profiteer and it is the Government's intention to extend their scope. Experience, however, shows that price control is liable to be ineffective and indeed harmful unless it covers an article through all stages of manufacture and great care must be taken that by the premature introduction of hastily conceived schemes, we do not add to the dislocation and consequent unemployment, which in any case is bound to attend the change over from peace to war conditions, and to which the right hon. Gentleman, the Member for Wakefield, referred yesterday. In the meantime very great assistance is being rendered by associations of manufacturers, who are discouraging any such action among their members and by associations of retailers and distributors, who are urging their members to refuse to recognise any unjustified price increase by their suppliers. I have every reason to hope that their action is already proving effective.

But despite all these precautions there may remain a small minority, who will attempt to profit from the national emergency. Such action is against the national interest and is unfair to the great majority of their competitors who are loyally co-operating with the Government. The Government feels that it is essential that they should be armed with powers to deal with such cases even though they earnestly hope that the good sense and national spirit already displayed by the great majority of the trading community will make their exercise unnecessary. They have accordingly decided to introduce measures aimed at the prevention of profiteering, and the precise form is now under consideration.

Mr. Shinwell

While thanking the right hon. Gentleman for his comprehensive reply, can he give any indication when the proposed legislation will be introduced?

Mr. Stanley

I could not say yet, nor could I at the moment say exactly the form it will take, whether it will be by Statute or by regulation. As the hon. Gentleman knows, it is a difficult question. We had considerable experience of a not altogether successful Act dealing with profiteering in the last war, and we want if we can to evolve something rather more effective.

Mr. Shinwell

In the meantime, where there are flagrant cases of profiteering proved to the satisfaction of the right hon. Gentleman's Department, will stern representations be made to the persons concerned?

Mr. Stanley

We are following up every one of these cases. Where we are not satisfied with the replies, we are asking for the details in order to check the amount, and where we are satisfied that profiteering exists, we will certainly take the matter up with them, and I am also prepared to consider the question of publicity being given.

Mr. Macquisten

Will not my right hon. Friend make it retrospective, and where, for instance, a man sells at 7d. or 8d. sandbags which originally cost ¾d., will the right hon. Gentleman go back to the man who sold them to the retailer, and so on, right back to the root of the matter?

Mr. Stanley

The legislation will be aimed at anyone who makes an excessive profit, whether he be producer, middleman or retailer.

Mr. Macquisten

Will the right hon. Gentleman rope them all in?

Mr. Stanley

For once, the Government are in full sympathy with my hon. and learned Friend's desire to regulate the whole community.

Lieut.-Colonel Sir Thomas Moore

Will the legislation enable such parasites on the State to be arrested and tried as traitors to the State?

Mr. R. C. Morrison

Will the right hon. Gentleman make clear whether the proposed legislation will cover not only cases of profiteering in future, but cases that have already been discovered?

Mr. Stanley

I will consider that. Hon. Members know, whatever their feelings may be, that there are very great objections to introducing retrospective legislation which involves penalty provisions.

Sir T. Moore

Will my right hon. Friend answer my question whether the proposed legislation will ensure that such parasites on the State will be tried as traitors to the State?

Mr. Thorne

Will the right hon. Gentleman give a definition of "parasite"?

Mr. Stanley

I do not think that every case of profiteering by a small retailer could be tried as a case of treason. I think it would be preferable that they should be tried as a breach of regulations. The courts will be able to deal with them adequately.

Miss Wilkinson

In view of the very great hardship that is caused merely by the addition of even 1d. or ½d. on ordinary things, will the right hon. Gentleman expedite this legislation and regard this as being one of his most important tasks?

Mr. Stanley

I do regard it as most important, and certainly I will expedite it to the greatest extent, but this is very difficult legislation to make effective, and I am anxious that the legislation should be not only speedy but effective.

Mr. Stokes

Will the right hon. Gentleman take steps to deal with the money-lending parasite whose rates rose by 300 per cent. overnight?