HC Deb 07 July 1942 vol 381 cc639-41
50. Mr. A. Edwards

asked the Chancellor of the Exchequer whether he is aware that the increase in the cost of coal to steelmakers will raise the price of steel by 7s. 6d. per ton and cause a new spiral in all costs of armaments and the cost of living, which will in the end be paid by the Government; and whether he will consider covering the initial increase by a subsidy and thereby stabilise prices with a resultant saving to the Exchequer?

47. Mr. Tinker

asked the Chancellor of the Exchequer what steps he proposes to take to prevent the recent 3s. per ton rise in the price of coal increasing the cost of living and so upsetting the policy laid down in the White Paper on Price Stabilisation?

Sir K. Wood

As to the bearing of the increase in coal prices on the Government's stabilisation policy, I would refer my hon. Friends to the reply which I gave to the hon. Member for Moseley (Sir P. Hannon) on 2nd July. As regards steel prices, the effect on steel costs of the increase in the price of coal, and the question how it should be dealt with, must be discussed with the industry, in order that we may decide on the necessary measures. The Government considered but rejected the expedient of a direct subsidy to the coal industry to meet the increase of miners' wages.

Mr. Barnes

Does that reference deal with increases in the cost of gas and electricity?

Sir K. Wood

My original answer dealt with all these matters, and I will send a copy of it to my hon. Friend.

Lieutenant Butcher

Would not an allowance towards the cost of carriage avoid an increase in prices?

Sir K. Wood

This matter was very carefully considered.

Mr. Barnes

Is this cost to be passed on?

Sir K. Wood

It will be a matter which will have to be examined first by the industries in question.

Mr. Shinwell

If it is examined by the industries in question—the gas and electricity undertakings—and they discover that the increase in the price of coal leads to increased costs, as no doubt it will, will they be permitted, without Government control and direction, to increase gas and electricity charges?

Sir K. Wood

No, Sir, only after the consent of the Government and after examination.

Mr. Woodburn

Will the Chancellor seriously consider the original Question, because, if the price of steel and other products rises as a result of the increase in costs for primary products, the extra work in costing and re-pricing will dislocate all the work done by Government Departments up to the present?

Sir K. Wood

No, Sir. I do not think that is so, although there may be a certain measure of what my hon. Friend indicates, but this matter was very carefully considered by the Government as a whole when I announced my decision.