§ Motion made, and Question proposed. "That this House do now adjourn."—[Mr. Bowden.]
§ 8.37 p.m.
§ Mr. Chetwynd (Stockton-on-Tees)
We are fortunate in having adequate time in which to discuss the general question of utility clothing. There is an anxiety about the cost of living, and the recent announcements by the Board of Trade of increases in manufacturers' maximum prices for certain classes of utility goods have focussed the attention of the public on the utility clothing scheme.
The scheme has proved a great blessing in the last few years, and has enabled many people to get the advantage of carefully price-controlled goods of assured quality and good design, at reasonable prices. This utility scheme has been one of the effective instruments of Government policy which has protected the standard of life of our people against the worst effects of the post-war worldwide inflation. I am anxious because this scheme, so well maintained by my hon. Friend over the past 18 months, seems to be in some danger of breaking down. Unfortunately, it has not been possible to insulate the scheme against the prevailing upward surge of world prices, brought about in the main by the uncontrolled scramble for raw material consequent upon the Korean war and the stock-piling that has taken place.
2249 This fact, together with the impact of essential wage increases in the textile and clothing industries, has made it impossible for the President of the Board of Trade to resist the pressure of manufacturers for increases in maximum prices. There is a real danger that the floodgates, which have kept back the price increases for some time, have now been opened and cannot be closed and that, unless some firm and immediate action is taken, the utility clothing scheme may be swept away. In my view that would be a great tragedy for the people of this country.
I want to deal specifically with the utility clothing scheme as it affects children's clothes. It is difficult to deal with one part in isolation, but I want to confine myself to children's clothing for two main reasons. The first is that the greatest hardship is being felt at the moment by mothers who have the responsibility of clothing and caring for children. I want to tackle the problem where the shoe pinches most, and where there is greatest need. While on this point I ought to pay tribute to the mothers of families for the wonderful way in which they have managed to clothe their children up to the present. I believe that our children are the best dressed, the neatest and the cleanest dressed that they have ever been. My greatest fear is that, as a result of the price increases, it may be more and more difficult to maintain those standards in the future, especially if the prices go on increasing.
The second reason why I want to confine myself to children's clothing is that, as the House knows, all children's clothing is free of Purchase Tax. There is a special problem which is not present with other utility clothing, because the inducement to manufacturers to produce more children's utility clothing in competition with their production for export and for non-utility lines is not so strong, because more profit can be made by them in other fields than the utility, and the tendency is to stress export and non-utility as against the urgent needs of utility.
I have some facts about the rise in the price of clothing. I calculate that between March and June this year at least seven orders have been made increasing the maximum prices of various articles of children's utility clothing. These will not 2250 work through into the retail stage until about September, but the general impact is that they increase the price of boy's utility suits and coats by roughly 28 per cent., boys' cotton shirts, vests and pyjamas by up to 5 per cent., cotton and cotton mixture utility cloth up to 15 per cent. and most infants' and girls' utility light outerwear by 20 per cent. The latest order of 6th June, which became effective on 11th June, allows an increase in prices of utility coats and heavy outerwear of 25 to 30 per cent. All this coming in a few months has meant a serious problem for mothers and housewives.
I want to give a few individual items to show how the increase in the prices affects the clothing of children of various ages. I will compare like with like as regards standards and quality. An expectant mother knitting woollen clothes for her coming child finds that, whereas a year ago she paid ls. 9d. an ounce for babies' knitting wool, she now has to pay 2s. 6d. When the child arrives she will find that the essential napkins have risen in one year from ls. 11½d. to 2s. 9½d. each, and that is a considerable burden upon a young mother. For a child of four or five, the mother will have to pay 65s. 7d. for a tweed coat set instead of 52s. 9d. That is in the specification of utility cloth No. 209. The cheaper quality has gone up from 44s. 6d. to 49s. ld.
A 22-inch school gabardine coat, utility No. 223, which is an essential article of the child's school equipment, has increased from 58s. 6d. to 72s. 3d. A gabardine raincoat for a girl of 10 has gone up from 81s. 4d. to 101s. 11d. That figure alone represents more than a week's wages for many of our people and it is really time that we tackled the problem seriously. For a boy of 10 the cost of a grey flannel suit has increased from £2 3s. 6d. to £2 10s., and in the field of accessories which arc essential I am informed that a boy's woollen tie which cost 2s. 9d. last year is now 3s. 1d. and new stocks coming forward to the shops will be marked at 5s. 6d.
I now turn to footwear, where the position is all the more alarming, and this is where we need definite action now. The latest permitted increase of 28th June allows an average increase of 7½ per cent. in the maximum prices for boys' and infants' footwear. This increase is not so great as the increases in men's and 2251 women's sizes, but even so they make a boy's grade 1 pair of shoes 55s. instead of 51s. 9d., a girl's grade 1 pair of shoes 55s. instead of 51s. 3d., and, worst of all, infants' shoes a maximum of 33s. instead of 31s. 3d.
When we consider the rate at which infants wear out their shoes or grow out of them, this is placing an intolerable burden upon any family in this country. The price of utility footwear is fantastically high in my opinion, and is likely to be still higher in the next six months. When we add to the original cost of the shoes the price of repairs, something between 10s. and 11s. 6d. for soling and heeling the shoes of a boy of 11, we can see that there is a clear case for the most drastic action to tackle this serious position. I will come to the remedy in a moment.
In my view there are two immediate grounds for action by my hon. Friend. My considered view, after careful examination, is that even with the increased cost of raw materials the permitted increases are at all stages disproportionate to the cost of production. My hon. Friend has told us that, before an increase is allowed, an investigation is made into costs. I want to know from him what is the nature of that investigation and what consideration is given when the trade association comes along, not only to individual items of production but to turnover. It is quite clear that the firm with a huge turnover is getting away with something, whereas others with a smaller turnover are scraping along.
We are also entitled to know, in view of the increases, how far are prices fixed to enable the less efficient producers to make profits, thereby allowing the efficient firms to get an unduly large profit. If we consider all the profits of companies engaged in manufacture, distribution and so on, we see that they are reaching astronomical proportions. I want to know, too, what room is there in all these utility grades for a pruning of margins at all stages. We also ought to know how recent are the figures supplied by the trade associations for costing purposes. I have no definite information, but my guess is that these figures are at least a year old and ought to be looked at again.
Now I turn to what I think is the bad effect psychologically of these price increases. The frequent increases and the 2252 way they are dealt with in the Press, through shortage of space and other reasons, create the effect in the public mind that prices are now out of control. We get the kind of case which we had last weekend in every shoe shop in this country where, two days before, there had been a notice in the Press and over the radio that prices were going up from Monday. As a result, all the shops were full on the previous Saturday and assistants were selling shoes as hard as they could go. In actual fact that panic buying was unnecessary, because the goods in the shops would not have increased in price since the price increase referred only to manufacturers' prices coming from the pipeline in four or five months' time.
In order to halt this upward tendency, it is necessary to make a breach in the constantly rising edifice of prices. And in order to show that the Government are in earnest in their desire to check the rising cost of living, it is necessary at this time that we should take some items and reduce them. This could be done without grave danger to the manufacturer, the wholesaler or the shopkeeper. It can be done at the stage with some items of woollen clothing, I will give my reasons. According to "The Economist" of 16th June this year:Many manufacturers are selling even now at prices some way below the maximum, and with the prospect of falling raw material prices the clothing industry may find it hard to take full advantage of the new price ceilings, particularly those for wool garments.The price of raw wool today is 10s. a pound below the peak reached last year. I am certain that nothing would do more good to the morale of the consumer than for my hon. Friend to give an assurance tonight that we have reached the peak of price increases and that, in the case of wool, where there is this sharp fall and where the maximum price is not being charged, he will take immediate steps to reduce that maximum. I believe that would give confidence to the public that we have control over the utility scheme, that we are carefully watching it, and that we are seeing that no unreasonable profits are being made from it.
Closely associated with the question of price is the question of quality. One of the benefits of the utility scheme and the utility mark is that they have afforded to the consumer a guarantee of quality 2253 as well as of price. People have known that when they have turned to utility articles they have got value for their money. My fear is that with the increase of prices, bringing the utility up to something like non-utility prices, many people will be forced to take goods of inferior quality because they cannot afford the high prices.
I have been told that utility cloth No. 206, a grey flannel for boys' suits, is a very poor cloth, yet it has been in existence for some time. It is liable to pull out from the seams under the armholes; it is so soft and raglike in substance that not even the most careful mother can mend it. A suit made from this cloth cost £2 6s. last year, and it had holes in it in less than six months. It would be tragic if confidence in the utility scheme was lost because of such examples, and I ask my hon. Friend to give some assurance that everything is being done to prevent a debasement of standards of the utility mark.
It is essential that if we are to help the housewife in her daily battle to make the housekeeping money go round and to keep her children respectably clothed, we must maintain at all costs a supply of carefully price-controlled utility articles, and we must use all the controls necessary in order to do so. I am convinced that this can be done without causing hardship to the manufacturers, the spinners and the weavers of clothing, who recently have been having a golden time. Such action is in the interests of the retailers, because they may have to meet a serious sales resistance in a few months' time unless something is done to bring down prices. Any measure of control, or of allocation of cloth in return for a percentage of utility goods, that my friend can take along those lines, will receive the firm support of all Members on this side of the House.
Let me deal now with what is, perhaps, the real and only long-term solution: that is, the question of subsidy. I must make this very earnest plea to my hon. Friend tonight in order to strengthen his hand in dealing with manufacturers, and so on, and also in the hope that my appeal and the support of the House will be powerful enough to reach the Cabinet and that we can get some decision from them.
I am certain that we must have a reintroduction of the utility clothing and 2254 leather subsidy. We cannot ask for it over the whole range of utility clothing, because that would be too great in present circumstances, but we should inject this subsidy into that part of the scheme where it is urgently needed and will do most good: that is, in children's utility clothing. We have the finest children and babies in the world, and we ought to see that they are well and properly clothed.
§ 8.53 p.m.
§ Mr. Grimond (Orkney and Shetland)
When the debate began it looked as though the custom of recent nights was to be reversed and the debate was to be entirely sustained from the opposite side of the House. But we have received an accretion to the Liberal benches, and I hope that later in the evening we shall have an intervention from the hon. Member for Edinburgh, South (Sir W. Darling), who is a great authority on clothing although, perhaps, not on utility.
The Parliamentary Secretary will be relieved to know that I do not intend to take this opportunity—I resist the temptation with difficulty—to suggest that we dress all children in Orkney and Shetland handwoven tweed. The subject of the debate is a most serious one, and the whole House is much indebted to the hon. Member for Stockton-on-Tees (Mr. Chetwynd). for having raised it tonight. Furthermore, we congratulate him on being lucky enough to obtain a quite considerable period in which it can be discussed.
There are few items in the budget of the ordinary household which are of greater concern than children's clothing. They are not a thing on which any parent wants to economise. They are, unfortunately, something which has to be continually renewed and recent increases in prices to which the hon. Member for Stockton-on-Tees referred are undoubtedly causing great concern and hardship in many families.
The hon. Member mentioned the question of quality and I think this is a most important matter. There is a tendency, as the utility scheme meets with difficulties owing to the rising cost of raw materials, to allow some debasement of the quality of goods in the scheme. I think it a very difficult matter and clearly, with the increases in wool prices, it is getting more and more difficult to work 2255 the scheme; but, in dealing with it, I say to the hon. Gentleman on the Government Front Bench that he should not debase the quality of these goods.
I think the utility scheme has done a very great deal of good. This is not the time to open again a discussion on the general principle of the Purchase Tax. We have had some discussion about that lately and, whatever we may think about that tax, I readily agree that so long as we have it it is very necessary to have a utility scheme and to remove the tax from what are undoubtedly essentials such as children's clothing on which no one would wish that we should unduly economise.
The hon. Member suggested various remedies. He suggested that a disproportionately large margin was allowed at various stages of production. We really must break down the belief that because a maximum price is fixed that is the price at which goods have to be sold. It is a question of competition and I think competition should be a great factor in keeping prices down. But when we come to competition we have also to bear in mind that the manufacturers themselves have to meet rising costs. What we have to face is the fact that we must have a greater output, more production, right through the whole of our economic life. I do not think that that will be easy—
§ Mr. Grimond
I am glad that the hon. Member agrees.
If we are to maintain the standard of life and check this continued rise in prices we must have more and more efficient production. There are some people who feel that some rise in prices is not altogether bad, that it guarantees full employment and is preferable to deflation. So long as it is kept in check, I have some sympathy with that view, but rising prices and a state of inflation always tend to hit the poorest members of the community. These are people whose wages, pensions and remuneration in general rise last, and they are the people who have to meet the rising prices very often before any readjustment has been made in their incomes.
2256 We must have some fear that the floodgates are open and that we may get into a state in which inflation goes beyond the bounds regarded by anyone as reasonable. The answer to that is more production, greater effort and the giving up of restrictive practices not only by manufacturers, wholesalers and retailers, but by the trade unions, where those practices exist.
As I say, one method of tackling this matter is greater competition, and greater production throughout the whole of industry. But wool, of course, is a product which is dependent on world markets and it would be unrealistic to expect anything from the hon. Member on the Front Bench tonight which would solve the matter in a few weeks or by a single stroke of Government action. The fact is that the price of wool has risen enormously in the past year and, although it may be falling today, it remains at an extremely high level.
We have, however, some right to ask the Government what are their intentions for the future of the utility scheme. Do they intend to continue on roughly the same lines, allowing rises at all stages of production? Do they intend possibly to give a subsidy on special articles, as has been asked for? Do they intend possibly to give some other form of assistance? I can quite see that an increase in family allowances, for example, which cannot be discussed tonight, might be one way of approaching this matter and might be a better way than the giving of a direct subsidy.
I hope that we shall have some enlightenment from the Government as to what are their intentions, and I should like to join with the hon. Member for Stockton-upon-Tees in impressing on the Government that this is a matter which is causing great concern in families throughout the country today. There are few aspects of life today that bear more directly or hardly on people than does the rising cost of living, and this is a most serious part of it.
§ 9.1 p.m.
§ Mr. Slater (Sedgefield)
My hon. Friend the Member for Stockton-upon-Tees (Mr. Chetwynd) has more or less covered the whole position in relation to children's clothing. He has given many examples of price increases that have taken place 2257 in children's clothing. There is great dissatisfaction in the country among mothers with a low standard of income because of the rising prices in the whole range of children's clothes.
I am one of those people who are rather afraid that because of what is taking place we might find ourselves eventually, because of the rapid increase in prices, in the position in which we found ourselves before the war. It is all very well for people to try to put over to the public a policy to the effect that wages are much in advance of the increase in the cost of living. That may be so in certain instances, but to try to put that over to the public at present is almost impossible.
We must take into account the fact that the workers in the textile industry may be receiving two and a half times the money that they earned pre-war and that that is bound to be reflected in the price of the finished article, but people with a fixed wage of about £5 a week, and who have a small family to keep, find it rather difficult, in spite of family allowances, to meet the price demands made upon them. I agree with my hon. Friend the Member for Stockton-upon-Tees that more could be done in that respect.
The idea was ventilated some time ago by my hon. Friend the Member for Coventry, South (Miss Burton), who advocated that a subsidy might be given in respect of children's clothing. It would be well for the Minister who is to reply to this debate, to tell us, if he is able, along what lines the Government are thinking of trying to ease the position of those people who even on today's income are finding it very hard to meet the demands of the day.
§ 9.4 p.m.
§ Sir William Darling (Edinburgh, South)
I find myself unusually encouraged by my close proximity to the fount of Liberal leadership in the House. I venture to speak on this all-important topic because for a long time I have been waiting to see the bold member of His Majesty's Government or their supporters who would "bell the cat." I have been waiting for a long time for the hon. Member for Stockton-upon-Tees (Mr. Chetwynd) to tear the veil of the temple in twain and show the hypocrisy and the complete failure of the Government to control the cost of living. He will be dealt with for 2258 doing so, but what he has said in such restrained and temperate tones is said over every shop counter throughout the country.
We all know that the cost of living is the greatest bugbear of the community today. The reason for the rise is in the hands of those persons who, for the past six years have guided and conducted our affairs; the Government who, six years ago, took control of our lives and destinies at home and abroad, from the Bank of England down to babies' bootees. Thus, today, we find ourselves disastrously placed in every field, whether it be the field of high finance or of babies' bootees.The fault, dear Brutus, is not in our stars,But in ourselves, that we are underlings.I am glad to see the Parliamentary Secretary sitting there. He has a very difficult problem to solve; as in the case of Ministers with higher destinies doodling will not help him very much. He has to answer the awkward remarks of his hon. Friends—
§ The Parliamentary Secretary to the Board of Trade (Mr. Rhodes)
I was putting down the answer which I will give the hon. Member in good time.
§ Sir W. Darling
I withdraw then; the Parliamentary Secretary was not doodling. I am sorry. Probably when he is raised to a higher position in the Government he will be given an opportunity to doodle very extensively, but I am delighted to learn that tonight he is to substitute doing for doodling, which is a change from the action of some of his right hon. Friends.
I remarked that the veil of the temple had been rent in twain. What has happened to those posters which decorated the buses and which appeared on hoardings throughout the country stating that the Co-op will cut costs? We have heard little of that recently. It was an admirable poster, depicting a long strip of cloth and a pair of scissors cutting it exactly in the middle. The Co-op would cut the cost of living. Has the Co-op cut the cost of living of the families on whose behalf the hon. Member for Stockton-on-Tees so rightly pleads?
§ Mrs. Middleton (Plymouth, Sutton)
May I ask the hon. Member if he is himself a member of a Co-operative society and whether he has tried the Co-operative way of cutting the cost of living?
§ Sir W. Darling
That is a personal question. I will tell the hon. Lady that I was once employed by a Co-operative Society at 10s. a day as a temporary salesman, so I know something of the inside workings of the Co-operative movement.
But I return to my main charge. Where is the proof that the Co-operative societies have cut the cost of living? If they have cut the cost of living, as they blazoned abroad that they have, what has the hon. Member for Stockton-on-Tees and his hon. Friend the Member for Sedgefield (Mr. Slater) to say? We have to face the fact that the Government which tried to control everything has failed to control anything, and that the cost of living rises high above our means. If there is a piece of deceitful advertising it is to say that the Co-operative societies have cut the cost of living by half—
§ Sir W. Darling
The Co-operative societies were saying that they were cutting the cost of living, and the picture suggested that they were cutting it in half. No doubt the Member for Plymouth, Sutton (Mrs. Middleton) will show the picture to her hon. Friend the Member for Bilston (Mr. Nally). It is an interesting little scroll. It states that the Co-ops cut the cost of living, and there is depicted a pair of scissors cutting, not two inches from the end, but right in the middle.
§ Mr. Chetwynd
Would not the hon. Gentleman agree that it is precisely the uncontrolled part of the economy dealing with the import of these articles from overseas where there is the greatest rise, that has its effect all through the economy, and that it is only through Cooperative trading, and so on, that we have been able to cushion the people from its worst effects?
§ Sir W. Darling
That may or may not be so. What I am concerned to say to the hon. Member who is whining about incompetence and ineptitude of his Government is that they started out to control things and have failed to control them. He has given an admirable case of that tonight. I understand the irritation of the supporters of the Co-operative Society that there should be such revelations of the ineptitude of this much boasted organisation.
2260 I have a suggestion to make, that this question is out of order. With great respect, if a subsidy is to be given for children's bootees and other garments—I will not go into a detailed specification —surely that would require legislation.
§ Mr. Deputy-Speaker (Colonel Sir Charles MacAndrew)
Can a subsidy be given without legislation? If not, it would be out of order to discuss it.
§ Sir W. Darling
It is quite out of order, and the Parliamentary Secretary can resume his doodling, because he cannot do anything about it.
§ Sir W. Darling
I congratulate the hon. Gentleman. He is fully equipped for his task.
I have directed the attention of the House to the failure of the Co-operative societies to do what they said they would do. I would now direct the attention of the House to over the Atlantic where, at this very hour, because the Shop Hours Act does not operate so ruthlessly as it does here, the stores are packed with women buying at 25 per cent. and 50 per cent. discount.
There has been a complete tumble in retail prices under a system which is relatively free from controls, at any rate as we know them in the retail trade in this country. Will not the hon. Gentleman who pleads for subsidies which are out of order address his mind to something which would be in order? It would be in order, because the Minister has nothing to do with it, to follow the example of the free retail traders of the United States where, today, prices for motor cars and every other item of daily and general use are tumbling. That, surely, is significant, because in that country there are no controls of the character that we have and, more than that, there are very few Coops.
§ Mr. Chetwynd
In view of that confession, will not the hon. Gentleman support the Government in their proposed legislation to deal with resale price maintenance?
§ Sir W. Darling
The hon. Gentleman has no proposal except control. The fidelity with which he still continues to pursue what is obviously a policy that has failed does more credit to his heart and his loyalty than to his head. But I will answer the question. Do I favour price maintenance? Of course I favour price maintenance. It would be extremely hard and unfair if the "Daily Herald" were sold for 3d. in Aberdeen and 1½d. in London. That is not price maintenance. I think it would be extremely hard if a 2½d. stamp cost 4d. in Aberdeen and 2½d. in London. That is not price maintenance.
Those are two examples which perhaps the hon. Member for Bilston will think over in the leisure which will come to him over the week-end. Price maintenance means that those who shop in the remote areas can buy at the same price as those who shop in London. Wherever one buys Eno's Fruit Salts the price is the same in Aberdeen as it is in London. Is that good or bad? Does the hon. Member want the people of Scotland to pay more for everything produced in the London area? Is that his proposal? That is not price maintenance; it is folly which will bring him to disaster. I see that the hon. Member for Bilston cannot contain himself any longer.
§ Sir W. Darling
The originality and tortuous character of what the hon. Gentleman says rather baffles me. Price maintenance does not mean that they would be sold more cheaply in Scotland, but that they would be sold at the same price. I am sorry that that point has eluded the hon. Gentleman.
I will proceed to the practical suggestion which the House is compelled to consider and discuss. During the last few days many suggestions have been made from this side of the House that His Majesty's Government should cut taxation. A cut in taxation and a reduction in the extravagance of the Government would put more money into the pockets of the people and enable them to 2262 have greater spending power. Had that proposal any support from hon. Gentlemen opposite? Two days ago we brought forward a proposal that people with families should get an Income Tax concession and every hon. and right hon. Lady and Gentleman opposite walked into the Division Lobby against this proposal, which would have helped people with families to meet some of this excessive cost.
Every proposal to cut the cost of living has been opposed and defeated by the Government. If the cost of living rises, as it will rise, the responsibility will lie on the benches opposite, and I regret to say that from their political point of view and from the point of view of their political fortunes, every man, woman and child in the country will know where to point the finger as the source of the evil. [An HON. MEMBER: "Nonsense."] An hon. Gentleman opposite says "Nonsense." If he goes to his constituency, where, if I remember rightly, he has a somewhat precarious majority, and, when he is told that the reason why the cost of living rises is because of the Government's policy, retorts "Nonsense," the reply of the ballot box will be quite conclusive.
§ Mr. L. M. Lever (Manchester, Ardwick)
I was waiting, along with the rest of the House, with avidity, for a practical solution towards countering the rising cost of living, which every one of us would like to do. Where are the hon. Gentleman's solutions?
§ Sir W. Darling
I know the difficulty which the hon. Gentleman has in containing himself, but he must try to do so.
I propose to recapitulate my arguments for his information. The rising cost of living is a grievous business, as we all agree. The responsibility for it lies with the Government.
§ Sir W. Darling
It is indubitable, because hon. Gentlemen opposite have been in control for the last six years. All the triumphs are theirs, and all the failures, surely, must be theirs. If I do not take the hon. Gentleman along with me, let him be assured that the public are with me. The second thing I say is that the Co-operative societies promised their million supporters—they are the most 2263 powerful of all monopolies—to cut the cost of living, and they failed to do so.
I would not advocate subsidies. I think they are a delusion and a snare. They are the bottomless pit which leads to complete destitution. I will not encourage any suggestion of subsidy whatever. People should stand upon their own feet, and there should be reality in manufacturing, trading and distribution. I do not agree with the suggestion, which is quite out of order, that there should be a subsidy. What I would say—
§ Mr. James Hudson (Ealing, North)
Would the hon. Gentleman advocate that all subsidies, which he thinks are so dangerous. should be removed?
§ Sir W. Darling
I would certainly consider it, if it were in order, and I would particularly consider the subsidy which Scotch whisky pays to the comfort of the hon. Gentleman. The taxation which we bear on Scotch whisky alleviates the cost of living of the hon. Gentleman. I am against that subsidy.
I suggest that the range of utility goods for children is unnecessarily complicated and varied. I think it is quite practicable for the Ministry to lay down to manufacturers of essential children's clothing no more than 10 or 12 items which would cover the whole field—a standard pair of breeks for the boy, a standard pair of socks and a standard pair of shoes, and so on. A limited number of these items, 10 or 12 in all, would be standardised, and would be retailed, hon. Gentlemen opposite may take it from me, if not by the Co-ops, by private enterprise traders at practically the cost of production. That would be a contribution on a limited line to the bare, basic needs of the children.
The hon. Member for Leek (Mr. Harold Davies) says that it will be regimentation, but who is he, the supporter of a Government which is today regimenting every man, woman and child in the country to speak of regimentation? Every boy and girl up to 14 or so would have standard clothing. There is nothing wrong with standard clothing. At the best public schools for boys and girls the pupils wear the same clothes. I understand hon. Members opposite sometimes 2264 go to dinners and dances. They do not wear uniforms on those occasions. They do not wear a kilt or a sarong or a silk hat. They wear a dinner jacket, like their neighbours.
There is nothing wrong with uniform. Let us see that the children of this country have a standard uniform. The Boy Scouts' Association provide at a nominal price the essential clothing that boys wear. The Girl Guides' Association do the same for the girls. That is the kernel of my idea. I sympathise with the hon. Member for Stockton-on-Tees, but let us discourage the production of some useless and expensive fripperies which are given to children by indulgent mothers who hope to see the beauty that is no longer theirs reflected in their girls. That is a laudable thing, but costly.
Those who want quality without trimmings, ornament or decoration in clothing which meets the needs of decency, orderliness and seemliness, in jumpers, shoes, and so on should have it. This would be not only a limited field in which the Parliamentary Secretary could exercise his gifts but he could exercise them there with greater success than he is doing on a far wider range elsewhere. Let us have standard flannel bags for boys and standard shoes. At that time of life children are not interested in being different from one another. It is their parents who want to be different.
My solution to this problem is not subsidies, but that we should limit the utility range severely and that we should not deny those persons who want the best for their money the opportunity of buying a standard uniform. Those who want variety will spend their money, and rightly, on pretty party frocks and kilts and the like. The hon. Member for Leek might have a little Lord Fauntleroy suit.
I suggest that for ordinary needs there should not be a subsidy but a standardised suit for boys and girls up to the age of 14. That would be sold—and I guarantee that it would be sold—not by the Co-operative societies, because they do not like standard prices, but by those who want to serve the citizens of the future at a very nominal profit. I present the Parliamentary Secretary with the idea. He will find it more acceptable than the idea of a subsidy. It will require no money from the public and no further extortionate taxation, but it will require 2265 more thought and more successful planning than we have had hitherto.
§ 9.25 p.m.
§ Mr. Jack Jones (Rotherham)
I did not intend to enter this debate until I heard the hon. Member for Edinburgh, South (Sir W. Darling). I was rather amazed to learn that he wanted to control and fix prices and to regiment people to pay the same price for and have the same texture, colour and so on in their clothes. I am the proud father of six children, four of whom have been married since the war, and I have five young grandchildren. I hear the story every time I go home of the ever-increasing price of children's clothing.
I would say, on behalf of the back benchers on this side of the House, that we are not at all satisfied with the position. There are no medals and there is no credit to be awarded for the ever-increasing prices. We are not concerned about those people who can afford to pay the prices and who are not worried by them; we are concerned about those people who are struggling on small wages to bring up a family in the way in which everybody in this country wants to see a family grow up.
The question is, what are we to expect to have to pay in the future if things go on as they are? The hon. Member for Edinburgh, South, prompted me to make my maiden speech. He is certainly provocative; he is entertaining, and I think that every time he speaks a hat should be sent round in order that we may pay an entertainment fee to listen to him. There is not the slightest doubt about it —as he is a Scotsman, he comes from a clan which has always believed in the highest possible margin, the highest possible price and the highest possible profit. Let us make no mistake about that.
I am a little tired of the hypocrisy which we have been getting recently from the Opposition benches suggesting that they are the only people who are concerned about the price of children's clothing and children's shoes. For the first time in the history of this country there are very few shoe-less and very few ill-clad children to be seen. That is for the first time in British history. That does not mean that we are satisfied to see them having to pay present prices for new clothing and new shoes. The hon. Member for 2266 Edinburgh, South, says the Government are to blame.
§ Mr. Jones
Only in the last fortnight. The hon. Gentleman should look a little further back than the last fortnight. Prices for wool are free, in uncontrolled capitalist markets, and they rocketed to 134 pence a lb. That was the price in Australia for wool—higher than ever in the history of the world. One of my hon. Friends says I am wrong. It was even more—it was 340 pence per lb. That is a fantastic figure.
§ Mr. Jones
That has nothing to do with it. If Australian producers—that is, the Australian capitalist Tory producers —are willing to sell their wool in the free uncontrolled markets to the Russians at the expense of British children, then Heaven help the capitalist Tories in Australia. It is in the uncontrolled market that the trouble arises.
The next question which arises is this. Having got the wool at a reasonable price, are we getting the best that we can from the wool we are able to buy? I say we are not, and I am speaking as a practical man. I know what wear we get out of clothing. I want to tell this country and the House that the Parliamentary Secretary to the Board of Trade has done more in 18 months to get quality utility clothing at a fair price than any other junior Minister in the history of this House—and that can be proved. It has been admitted on all sides, and it is admitted by the trade.
It is sheer hypocrisy for the Opposition to get up at this late stage and make these claims after a century of exploitation. One can remember when the only clothes which the children had were available to them on the Saturday and Sunday and for the rest of the week were in the pawnshops in Britain. Hon. Members opposite allowed that system 2267 to operate without any control and without any effort to control it.
Now we have difficulties because of potential war conditions, because of Korea, because of stockpiling, and because of the greed of those people who see and seize an opportunity once again to profit at the expense of this country. For hon. Members opposite to say in such circumstances that they are the advocates of control and are best friends of the working class and their children is sheer, unadulterated hypocrisy of the worst kind—and I say so.
Let hon. Members opposite go into the mining areas. The hon. Member for Edinburgh, South, knows about the mining areas. Let them go into East Fife or into South Wales or into my area and see the miners and the steel workers and the workers in heavy industries, and let them look at the children. I am not satisfied that these people are getting clothing at the right prices, but I say again that the Government have done more to control prices than any other Government. Take the question of the Argentine. This House cannot go to the Argentine Government and say, "You must sell your hides and skins to this country at our price."
§ Mr. Jones
Yes, they used to, when there was no demand and prices were down: but in a world of demand, go out into the cotton fields in Egypt and talk to the Egyptians, go into the Sudan and talk to the Sudanese, go into South Africa where the cotton growers and pickers are, and they will tell His Majesty's Opposition that they will no longer be satisfied, as they were in the past, with the fear of the gunboat just off the coast, and the fear of the might of this country; they will not put up with those things. They want what we want.
Almighty God may have made a mistake when he made mankind all with pretty much the same sized stomachs, but the cotton picker in Egypt today wants for his cotton what the British miner wants for his coal, the Argentinian wants for the hides and skins he produces what we want, and that is a higher standard of living; and the only way they will get a higher standard of living is by getting higher prices for the goods they sell to 2268 this country. One of the troubles is the high prices demanded by other countries because of their desire to live as well as the party opposite have lived for far too long, and better than they deserve. That is the trouble in the world today.
The hon. Member for Edinburgh, South is a businessman. Can he get up here with his hand on his heart and say that in the chops he helps to control he has of his own volition, knowing that the prices of children's clothing are too high, said to his operatives and his managers, "Reduce the prices" to set an example, and to do what they have done in New York? Has he done that?
§ Sir W. Darling
Not only have I done it, but retailers throughout the country and the public are just now enjoying what they call the summer sales. I will send the hon. Gentleman a catalogue.
§ Mr. Jones
There are very few articles in the utility range on sale at summer sales. If the hon. Gentleman will go and look at the summer sales, he will find that they can afford to cut prices drastically and have fictitous sales because of the profits they have made on the uncontrolled articles they have sold. Make no bones about that. Otherwise they would not be holding summer sales but would be selling out completely.
I emphasise that we on this side of the House are not prepared to see prices increasing. We want all the controls possible. For the party opposite, whose theme is "Set the people free" to come along on occasions like this and say "Control us more and more," because the next election may arrive shortly and they want by propaganda speeches such as we have heard tonight to get the votes of the people, is sheer, unadulterated hypocrisy.
§ 9.33 p.m.
§ Sir Herbert Williams (Croydon, East)
We have just listened to a somewhat inflamed speech from the hon. Member for Rotherham (Mr. Jack Jones). I listened to it with interest, because it was not quite clear what he was driving at. He will find it interesting to read his speech in HANSARD tomorrow, because he was telling us that one of the main reasons for the rise in the price of the children's clothing we are discussing tonight was because the people in Egypt, in the Argentine and in Australia want a higher price for the raw materials they produce.
§ Sir H Williams
That is not quite the same thing as he was saying earlier in his speech, when he said that the rise in these prices is due to the terrible iniquities of my hon. Friend the Member for Edinburgh, South (Sir W. Darling), who is a shopkeeper.
§ Sir H. Williams
The hon. Gentleman was giving two completely different explanations. It is no good talking about the price of one commodity. Let us get down to the major issue. Some hon. Members may remember that on the night of 8th March and in the early morning of 9th March there were on the Order Paper seven Prayers concerning the increase in the cost of living. Let me remind the House of what happened that night. We selected seven orders, all authorising increases in prices.
§ Sir H. Williams
Let me finish my point. I have not the slightest doubt, as I have said before in these debates, and as I said on a debate on furniture the other night, that the manufacturers concerned succeeded in satisfying the Parliamentary Secretary and his chief that these increases were justified. What we sought to do on that occasion was to try to get a general debate on the increased cost of living and the causes of it. Unfortunately the rules of order made that impossible. Instead of having one debate ranging over the seven orders which covered a very wide range of commodities, we were forced to discuss each order by itself. I remember the discussion. I got up at seven minutes past three in the morning to move an order with regard to furniture. At the end of 50 minutes, I had delivered a ten-minute speech because there was nothing but babel from the other side. We were discussing the same subject as we are discussing tonight.
§ Sir H. Williams
I have already explained that we tacitly assumed that the hon. Gentleman and his chief had examined the books of these various manufacturers and were satisfied that 2270 unless they had this authorised increase, production would cease; therefore, what was the point in dividing? Hon. Members opposite were justifying the authorisation of increased prices owing to increased costs. What we were getting at was the fundamental cause. That is what we have to get down to.
My hon. Friend the Member for Edinburgh, South, has referred to the effect of taxation upon costs, and, of course, the range for public economy is vast.
§ Sir H. Williams
One has only to look at the Civil Estimates. Quite obviously, I cannot go into details, otherwise I should be out of order. I would completely destroy the "Central Office of No Information." I would effect economies in our Defence Forces where there is more waste than in any other direction I can think of. That is just in passing.
The general statement made by the hon. Member for Edinburgh, South, is quite clear. One of the substantial causes of the high cost of living is the very high level of taxation. We have a burden of expenditure which, leaving out of account everything to do with defence and everything to do with the National Debt, is about three times as much as it was prewar, and to say that there is no room for economy is sheer nonsense.
§ Mr. Monslow (Barrow-in-Furness)
Is the hon. Gentleman suggesting that food subsidies and money spent on the social services would be the basis of his cuts?
§ Sir H. Williams
What is the purpose of food subsidies but to reduce the cost of living and the object of Purchase Tax but to increase the cost of living? Any intelligent Chancellor of the Exchequer would pursue the general policy of gradually diminishing both the Purchase Tax and the subsidies. What is the sense of charging too much for some things—many of them essential—by reason of Purchase Tax and at the same time reducing the cost of other things by subsidies? It is much better that things should be sold at their proper price.
§ Sir H. Williams
It is no good the hon. Gentleman trying to catch me on that subject; I am much too fly a bird for that. I asked the hon. Gentleman to get hold of any of the companies that tomorrow morning publish their accounts in any newspaper and compare the amount paid in wages and salaries and the amount of the net distributed profits, tax-free in both cases, and he will find that in most companies the ratio is about 15 to one. If we were to wipe out the whole of the distributed profits it would not make more than 3 or 4 per cent. difference to the price of anything. [Interruption.] I think that the hon. Gentleman referred to services. If I visit his establishment and pawn my watch, he charges me interest on it when I come to redeem it.
§ Dr. King (Southampton, Test)
One of the points made by the hon. Gentleman was that we should cut Purchase Tax. We are debating the rise in the cost of children's clothing. The Government have removed the Purchase Tax on children's clothing.
§ Sir H. Williams
The debate has drifted a little wider than the immediate issue. The hon. Member for Test (Dr. King) took it beyond that issue, and it has become a general debate on the increased cost of living. On the Adjournment, provided it does not involve legislation, anything we say, within reason, is in order.
Let us take the next issue. As long as 1946, speaking at the Conservative Party Conference at Brighton, I urged that we should allow the pound to find its own level. I did not get much support, but I continued with that subject. Ultimately, Sir Stafford Cripps, after declaring several times that he would not devalue the pound, did devalue it and he did a much worse thing, for instead of allowing the pound to find its own level he re-fixed its value. After that many of our exports cost us far more than would have been the case if the pound had been permitted to find its own level. That is one definite issue which can be taken by administrative order.
§ Sir H. Williams
We are talking about the increased cost of living, and exports 2272 and imports will equalise themselves without currency control, capital control or any other control provided the pound is allowed to find its own level. We tried it twice in recent times. On 19th August, 1919, as a result of the decision announced in the House of Commons by the then Prime Minister, the pound was allowed to find its own level.
§ Sir H. Williams
That did not come about until a year later and for entirely different reasons. Trade continued at a high level and then in July, 1920, there was a sudden collapse of prices in Japan, next in the United States, and finally here, with the result that unemployment rose. By November of that year there were one million out of work.
§ Sir H. Williams
That was 1931, when the hon. Member's friends were in power and we had nearly three million unemployed.
§ Sir H. Williams
In those years, when I was first a Member of Parliament, we laid the basis of our modern social services, including the whole system of widows' pensions, orphans' pensions and contributory old age pensions. [An HON. MEMBER: "Only 10s. a week."] It was more than the 5s. allowed by Lloyd George, and it was contributory without a means test. [Interruption.] The hon. Member for Ardwick (Mr. L. M. Lever) need not interrupt me about these things, because I remember them all.
§ Sir H. Williams
I do not know about that, but I joined the State Children's Association before the hon. Lady was taking an active interest in politics.
§ Mr. Nally
On a point of order. I should like to ask for your guidance, Mr. Speaker. I understand that the subject chosen for the Adjournment debate tonight was children's clothing. It began as a serious debate, and one would like to ask whether it is considered that the sort of thing we have listened to for the last moment or two comes under that head, and could some steps be taken about the matter?
§ Mr. Speaker
On the Adjournment, I have no control. The subject which is put down is not official. It does not appear on the Order Paper, and, therefore, I am rather powerless in the matter. At the same time, in view of the subject chosen by the hon. Member for Stockton-on-Tees (Mr. Chetwynd), I hope that we shall devote ourselves as much as possible to it.
§ Sir H. Williams
May I point out that I was devoting myself essentially to that subject? Hon. Members will remember what I said a little earlier. It is no good discussing by itself the price of certain articles of children's clothing unless the fundamental issue behind it all is dealt with, namely, the rise in the cost of living. I listened quietly to the speeches of hon. Gentlemen who preceded me. I should not have raised these issues if I had not been asked questions by hon. Members and requested to give them the answers.
What is the use of discussing the cost of living when it is only a fortnight since the Chancellor agreed to grant to the Bank of England, which is a State institution, the right to print 50 million more £1 notes? Everybody knows that inflation comes entirely from the currency system. We can stop the increase in the cost of living tomorrow morning if the Chancellor will go to the Bank of 2274 England and tell the Governor to withdraw £50 million from circulation. That is the issue we have to face. If we go on using the printing press to create purchasing power without simultaneously producing commodities to balance it, the cost of living will inevitably go up.
§ Mr. J. Hudson
Is the hon. Gentleman saying that the Tory Party would actually embark upon a policy of deflation?
§ Sir H. Williams
I am glad that the hon. Gentleman said that. I know the difficulty that he is up against, but politicians on all sides have been talking an awful lot of nonsense about what they call the policy of full employment, which is being achieved today by deliberate inflation. Political parties are going to come up slap bang against this issue of how we are to stop inflation. Some setback will be inevitable, because if the politicans of all parties do not stop inflation we shall get what has happened time and time again in various countries: inflation will go on until it falls over itself. We shall have a catastrophic fall in prices, and unemployment beyond anything that hon. Members have ever experienced before. Hon. Members are declining to face up to it now.
There is a common underlying force in these things, and until the Chancellor of the Exchequer does his proper business, hon. Members can go on denouncing profiteering, but prices will continue to rise, to the misery of the people.
§ 9.49 p.m.
§ Mr. Logan (Liverpool, Scotland Division)
I have listened with great pleasure not only to those who are business men but to those who are not, dealing with this subject. I am interested in what it costs to clothe our children. I can remember when sheets were sold at 3s. 11d. per pair. They are now 52s. 6d.
§ Mr. Logan
Blankets used to be £3 3s. a pair; now they are £7 10s. A bedroom suite used to cost £8 10s. and now costs £60. A Sheraton suite that cost £30 now costs £250. I begin to wonder where costs are leading. I am reminded that the shopkeeper must have a fair return. No one disagrees with that policy. I have asked what a fair return is. I should imagine that a fair return in profits ought 2275 to be commensurate with the wage of those making the goods sold for profit, and if the worker is unable to get a living wage there is no justification for extortionate profits to be made out of the product of his labour. In that way we get down to a logical standard of life.
Whether hon. Members on this side of the House or on the other side be doctrinaire about a particular policy I do not know and do not care. What I am concerned about is a population getting a standardised wage. Most of our areas contain congested districts where large families live. The life of the nation depends on the money coming into the home, and if the people do not get good food, clothing and shelter the nation pays the penalty in malnutrition. We see that there has been a great rise in prices since the war and we also see that there is a better standard of life. Our children are not badly clothed and there have been no barefooted children in our cities for the last eight to 10 years.
§ Mr. Logan
The result of the great social revolution is that the children of neither the rich nor the poor are walking about barefooted in our great cities. We have seen a wonderful change.
When my hon. Friend the Member for Stockton-on-Tees (Mr. Chetwynd) mentioned a subsidy, an hon. Gentleman said that that would be out of order. Surely it is not out of order when we are trying to solve such a problem as this. We have had to try to solve many problems in this House. I have heard many solutions suggested from a business point of view which have been totally impracticable and I have heard many absurd suggestions from people who know nothing about business. We meet here to consider the problems of the day, and if a subsidy is necessary, then we must bring about a subsidy. If costs exist which impoverish the people then it is for the House of Commons to consider the problem.
Why should costs be rising gradually day by day? Take the case of a little child's coat. It consists of half a yard of cloth which cost about 10s. 11d. before the war, but is now 65s. A dish cloth that used to cost ld. now costs 6d. An engine wiping greaser carried 2276 by the firemen on his belt, costs 1s. 6d. Pillow slips are now 4s. 6d. each, and we used to be able to get any amount of them at ls. 6d. or 1s. each.
§ Mr. Logan
The world has gone mad over the cost of goods. Children's boots are made not of leather, but of paper. The tops of boots are of split leather and they have paper insoles, while the outer soles are made of a rubber composition. Prices asked for these are 15s., 17s. 6d. and 21s.; and this week we heard that a good standard boot will cost £5 2s. I do not know where the £5 will come from, and I am wondering how families will carry on. I am also wondering where the spiral will end, because if the cost of material goes up day by day then the demand of the workers will be for more pay.
Let us look at the quotations for stocks and shares. We shall find that most of the companies dealing in these commodities show the great profits that are now being made through the market quotations of their shares.
§ Mr. Logan
Whether it be the Co-op. or any other "op.," I am not concerned.
No one who charges people more than a fair price for his goods has a right to the sympathy of the House. I am not concerned with any huge organisation or cartel, but with the poor and the middle classes who live in our huge city areas, and who are the manhood and womanhood of the nation. They have large families and their children go to war. If they are good enough to fight for the nation they are good enough to be protected against excessive costs, and it is our duty in this House to deal with this matter.
The Board of Trade have a legitimate, perfect and moral right to look into excessive costs and any Government, whether it be Labour or Tory, will be faced with this huge cost of living. The present pernicious system is one of the most damnable things in operation. The Board of Trade ought to take cognizance of the high rise in prices to see what can 2277 be done to give not only a fair and a legitimate profit to the trader but, at the same time, to see that the men and women who produce the goods are not bled when they have to purchase them.
It is a curious thing, but often the man who makes the cloth and the boots is badly clad and badly shod. It is a tragedy to find today that the man who makes them is not able to purchase them and that they go into a market where people can sell at exorbitant prices. If the House of Commons means anything, to me it is a place of moral values where men place a right value on the labour of men and women. The Board of Trade should see that justice is done.
Looking back over prices during the last 50 years of my life, I say that the prices being charged today are out of all proportion to the pay of the labour engaged in making them, and the Minister should take that into consideration. Go where he will he will find that people are fed up with the high prices of goods. The hon. Gentleman who brought this subject forward tonight put his case in a reasonable fashion and he dealt with some of thy; major problems that ought to be solved.
§ 9.59 p.m.
§ Mr. Nabarro (Kidderminster)
I am sure that few hon. Members in any part of this House will disagree with the pious but admirable sentiments expressed by the hon. Member for Liverpool, Scotland Division (Mr. Logan), who is one hon. Gentleman opposite, representing a tiny minority with a little commercial and business experience—
§ Mr. Nabarro
The hon. Gentleman who is interrupting me is surely a lawyer, and very few people on the other side of the House have the executive business experience to which I was referring.
§ It being Ten o'Clock, the Motion for the Adjournment of the House lapsed. without Question put.
§ Motion made, and Question proposed, "That this House do now adjourn."—[Mr. Pearson.]
§ Mr. Nabarro
I shall address my comments specifically to the question of the 2278 excessive profits that are alleged to be earned in the manufacture of children's clothes. In the course of the last few months, we have had many Prayers in the House. We have had Prayers complaining about the cost of carpets, of hardware, of sewing cottons and of a whole range of manufactured commodities. Whenever one of those Prayers has been taken, the accusation has been made from hon. Members opposite that it is a political manoeuvre on the part of the Tory Party to keep the House up late and that the complaints in regard to the inflationary policy of the Government have been without justification.
This evening, we have the interesting counterpart—a little honesty from the hon. Member for Stockton-on-Tees (Mr. Chetwynd), who genuinely and sincerely makes a speech on the Adjournment Motion, complaining in exactly the same terms as the Prayers of hon. Members on this side of the House of the inordinate rises in the costs of our essential goods and services.
The Parliamentary Secretary to the Board of Trade, who is presently to reply, is a business man. He has been the principal executive of a textile firm for many years. Let him answer this specific point: Is he satisfied that the complaints made by hon. Members behind him, to the effect that the Board of Trade are lacking in the performance of their duties in regulating profits and fixing prices, is a genuine charge? From my knowledge of trade negotiations with the Board of Trade to fix prices for utility clothing, for carpets or for any other manufactured commodity.
I have always found the Board of Trade not only most capable, most helpful and most punctilious, but most fair in trying to ensure that an excessive profit is not earned by the manufacturer and that the interests of the consumer are protected. [Interruption.] If the hon. Member for Kirkdale (Mr. Keenan) has any complaint that what I am saying is untrue or exaggerated, let him go outside the precincts of the House' and accuse the Parliamentary Secretary of neglect of his duty in allowing manufacturers to make excessive profits on price controlled articles.
§ Mr. Keenan
Is it not the fact that the price control standard that is set is based on the production costs of the least efficient manufacturers?
§ Mr. Nabarro
If the hon. Member will allow me to continue and not try to make my speech for me, I shall pass to that point in a moment. For every £3 of gross profit that a manufacturer earns, the Welfare State and the Treasury that serves it, take back £2.
§ Mr. Nabarro
My hon. Friend says "More." Perhaps they take back £2 ls. out of every £3. There would not be any monkey nut schemes in East Africa, or any egg schemes in West Africa; there would not be any National Health Service, any educational reform, or any of the social services for which hon. Members opposite take credit, if it were not for British industry providing the financial sinews through their contribution of two-thirds of all the gross profits that are earned, being returned to the Treasury. [Interruption.] The hon. Member for Westhoughton (Mr. J. T. Price), who recently returned to the House with a handsome majority, represents a manufacturing constituency in the North-West, and he says "where are the profits?"
§ Mr. Nabarro
I am sorry that I attributed that remark to the hon. Member.
The Welfare State is being financed very largely by British industry. I want to depart from this quite false allegation that excessive profits are being made on utility goods because of the whole principle of children's utility clothing and other commodities of a similar character. Of course, the utility prices today are kept artificially high as a result of the negotiations between the Board of Trade and the manufacturers, simply because under a utility system, under this wretched abracadabra of control and subsidies in which we have got ourselves entangled, the price is unfailingly set on the basis of the costs of the slowest and least efficient manufacturer.
I heard many gibes from hon. Members opposite when my hon. Friend the Member for Edinburgh, South (Sir W. Darling). Was speaking earlier, because he advocated in forthright fashion a return to free enterprise and the essential features of a capitalist society.
§ Mr. Nabarro
The hon. Member says "Unrestricted?" In the case of utility clothing, of course, we recognise that for the time being we must carry on with the scheme. But what I believe is urgently necessary is a steady decontrol of all these schemes in an effort really to restore a measure of competition in place of the present system of subsidies and Board of Trade control which is manifestly inflationary.
Many hon. Members have referred to the inflationary tendencies of the last few years. I think the position will probably get worse before the year is out, but every hon. Member opposite might do well to remember that the principal cause of the rise in the cost of raw commodities in the last two years has derived directly from the devaluation of sterling.
§ Mr. Nabarro
The hon. Lady said it in a very masculine voice. [An HON. MEMBER: "Her name happens to be 'Mann'."] She will be interested to know that one grade of wool in which I have been interested in my constituency, carpet wool, was costing 46 pence per 1b. before devaluation in September, 1949, but, within three months of devaluation, that same wool was costing 78 pence. There was an increase—
§ Mrs. Mann rose—
§ Mr. Nabarro
If the hon. Lady will allow me to complete my sentence—there was an increase of two-thirds in the cost almost overnight. What was the cause? Devaluation, preceded by the wretched acceptance of the American Loan, Marshall Aid and rigid adherence to Bretton Woods and all the financial shibboleths which the Socialists have strongly supported for so many years.
My hon. Friend the Member for Croydon, East (Sir H. Williams), referred to the question of the fixed and arbitrary rate of exchange between the pound and the dollar. Of course, Sir Stafford Cripps made a dreadful blunder when he fixed that rate of exchange, 2281 but Chancellors of the Exchequer who preceded him from 1945 onwards, made a more dreadful blunder when they failed to recognise that the greatest asset and strength of the British economy lies in the strength of its currency, in the strength of its sterling, and that that could only be established on world markets by a completely free pound, untrammelled and untied to any foreign rate of exchange. By that means we could have stemmed inflation a long time ago and the inflationary difficulties of which we complain today would never have been experienced.
§ 10.4 p.m.
§ The Parliamentary Secretary to the Board of Trade (Mr. Rhodes)
This has been a longer debate than I anticipated earlier in the evening. It has rambled all over the shop but at least it has allowed people to say what they have in their minds, which in some cases was not very much.
I personally have no apology to make for the utility scheme in any shape or form. I stand by the utility scheme as I have for the last 15 months and as I have fought for it and cared for it for the last 15 months because—in spite of its imperfections—if it had not been for the utility scheme we would have had such a high rise in the cost of living that we would not be thinking in terms of it now, but in terms of it a lot earlier, probably coinciding with the war in Korea.
The first job I did when I went to the Board of Trade was to set about this question of the utility scheme. At that time there were, hon. Members may remember, many shortages in all types of clothing and accessories, such as household textiles, but gradually through the summer, autumn and winter months last year we built up in the shops a stock which has stood this country in good stead when prices have been increased.
I wish to deal with the points that have been raised. I shall probably not do so in the order in which they were made but that does not matter. Let me deal with the point about paper shoes. A lot of nonsense it is. Let my hon. Friend get hold of the Footwear (Supply, Marketing and Manufacturers' Prices) Order, 1950, and look at the specification which cannot be departed from. If manufacturers do depart from it they are subject to penalties.
§ Mr. Logan rose—
§ Mr. Logan rose—
§ Mr. Rhodes
I am afraid there is only limited time. If my hon. Friend will look at page 9, he will see the minimum standards laid down.
§ Mr. Rhodes
I am glad that my hon. Friend the Member for Stockton-on-Tees (Mr. Chetwynd) raised the question of children's clothing. I wish to remove, if I can, a few of the misconceptions in the public mind. My hon. Friend referred to seven recent Board of Trade orders increasing the prices of children's clothing. That in itself is misleading because those orders apply to a number of different garments, and with one exception, and that for a particular reason, it is not true that there has been more than one increase since March in the price of any one garment.
In comparing clothing prices 12 months ago and now, we should bear in mind that raw material prices then were substantially lower. I can give the House a clear indication of the movement of material prices by pointing out briefly that wool cloth prices rose by 40 per cent. for worsteds and 30 per cent. for woollens from June, 1950, to February this year, and these February cloth prices relate to last October's prices for wool.
I wish there were less talk about this question of wool prices. There is nothing in the shops apart from one small aspect of the hosiery field which has anything 2283 to do with wool prices higher than those of last October. The prices since that time have been taken by the manufacturers and those engaged in the industry back again almost to where they were last October. That has been the slack that has been taken up by the manufacturers and the people engaged in the industry: reference was made to 10s.— I say 100 pence. From the beginning of October no garments of wool and animal fibre have been put in the shops based on any higher prices than the raw material prices ruling last October.
There has also been an increase in the cost of linings in the case of gabardines and wage increases in the clothing industry during the last year. I will deal at greater length with clothing price increases later, but at the moment I wish to deal with the subject of footwear. There is a lot of nonsense talked about this. Our system of price control for the footwear industry divides shoes into three grades. We have been able to rely on the competition in the footwear industry to keep the prices of different qualities within each grade down below the maximum permitted price for its grade, and at any time over the last year I am sure hon. Members will have been able to confirm that maximum prices were certainly not being charged in every case for each grade.
§ Mr. Rhodes
I hope that some hon. Members have had a look in the shops today. I had a check made on the prices being charged in shops not far from this House during this afternoon. Until the end of last week the maximum price for boys grade III shoes was 22s. 9d., for grade II, 34s. 2d. and for grade I, 51s. 9d. The new permitted maximum prices were 24s. 6d., 36s. 9d. and 55s.
§ Mr. Rhodes
My check this afternoon showed that in not one single case had the prices risen above the former maximum prices. In fact, in not one single case were they even at that level. The orders introducing these new maximum prices will have two effects. They will bring back into its original grade footwear which had moved into a higher grade 2284 because of increases in basic costs arid. therefore, make that footwear subject to the new maximum prices for its original grade.
Second, they will enable manufacturers of top quality footwear selling at the top of the utility scale to continue to sell their quality of footwear as utility. I had an inquiry made today of one of the largest firms which manufactures and retails footwear. Everyone knows the name of the firm. They told us that they have not altered any of their prices, and that they are exactly the same today as they were last week. This, I think, gives the direct lie to the suggestion that prices in the shops will rocket to the new permitted ceiling prices.
§ Mr. Rhodes
Those who were selling below their maximum before have no more incentive now to raise the prices than they had last week and I think that the trade are as anxious as we are that prices should be kept down so far as possible.
I wanted the opportunity to say this in order to avoid unnecessary anxiety to the consumer. There seems to have been a lot of nonsense spread abroad about what these increased maximum prices will do. When we authorised the increases we were at pains to emphasise that it did not mean that all prices would increase. May I quote from the statement we issued to the Press:…The system of price control is such that some of the increases of cost have already been taken into account in the prices of a large part of the output and, therefore, the full permitted increase will not be applied except to a small proportion. In the case of the majority of the output the increase may he expected to be considerably less.Was that interpreted to the public in that way?
Reverting to the case of the large manufacturers which I quoted a moment ago, they had some trade in men's shoes at the old maximum price for grade I, namely, 85s. 3d., some trade, again in grade I at 79s. and a great deal of trade, again in grade I, at about 65s. As I say, these prices remain the same today. There may be an increase in the shoes which are still selling at 85s. 3d. in order to allow the manufacturers to continue to make that duality of shoes within the utility scheme for which the basic costs have un 2285 doubtedly risen. I am not arguing that. That is why the prices were put up. Precisely the same applies to children's footwear, but the increase in maximum permitted prices has only been some 7½ per cent.
I am grateful to my hon. Friend for raising this question in a sane, practical and common-sense way. The Press has given a good deal of publicity lately to the news of price increases. There may be a reason for that. I hope that in fairness they will give equal publicity to the statement which I have made tonight about the prices of utility shoes.
While on the subject of the announcement of price increases, I should like to make two points clear. First, the manufacturers do not necessarily push their prices up to the maximum level permitted. Secondly, in the case of clothing, they very often have good stocks at the old prices. When I have said this to my friends recently they have looked sceptical and said that the maximum price is the price at which clothing is sold, and that when new prices are announced it is difficult to get any goods at the old prices.
I should like to give some information which I had collected on Friday. These are a snap sample taken in London, Cardiff, Cambridge, Birmingham and Manchester since last Thursday. Two hundred examples were taken. We really went to business on this. The details show that, in the case of girls' heavy outerwear, girls' overcoats were priced in the shops now at 84s. when the maximum price in the utility schedule is 110s. 4d.
§ Mr. Rhodes
Size 39 inches.
In the case of light outerwear, goods were priced in the shops at 13s. 11d. when the maximum utility price was 19s. The price of locknit underwear was 7s. 8d., when the maximum price in the utility schedule was 9s. 7d. I think that illustrates the point I was making. A girl's cotton frock, for which the maximum is now 19s., was selling at 13s. 11d. These are not extreme cases. I could have picked out much more spectacular ones. I recognise that these prices apply to old stock, but that proves one of my points which is that it is by no means true to say that in every instance prices will soar to the new maximum level.
§ Mr. Rhodes
I was asked about our costings investigations. These investigations are carried out by the Board of Trade accountants or by our Accountant Adviser. They examine costings from representative traders. We do not take the highest cost of manufacture as the basis of our price fixing. On the other hand, I assure hon. Members that in my opinion we can never knock the inefficient man out of business simply by using price control alone. The less efficient manufacturer can always change to lines that suit him better, or he can make something completely different.
It is extremely important, especially with children's wear, that a full range of sizes should be produced and that we should maintain quality. We have always, of necessity, to strike a balance between keeping prices down to the maximum possible extent and securing adequate supplies in the shops. This is perhaps the time to say that when prices of raw materials are falling_ we can normally depend on competition to reduce clothing prices.
In the case of wool and animal fibre clothing, if hon. Members refer back to October, 1950, they will find that prices fell. If and when material prices fall below the level on which our garment prices are based we shall review the maximum prices we allow. I can assure my hon. Friend for Stockton-on-Tees that we will bear the point he mentioned in mind, and call for a meeting of the traders concerned to discuss at the appropriate time the reducing of prices.
My hon. Friend also referred to the question of profits. Naturally, the large-scale firm makes a larger absolute profit than the smaller manufacturer. Otherwise, there would be no incentive to increase production. On the other hand, when the price of the raw materials increases we do not allow increased profits on these increased costs of manufacture. When there have been big increases in manufactured prices we have reduced the percentage margin for distributors. We shall continue to keep a very close watch on distributors' profits.
My hon. Friend mentioned utility cloth No. 206. I do not think that it is a fair example. Traders and manufac- 2287 turers have made a good show of quality during these last few years, and utility clothing is regarded as of such good value that many people from the Continent come to this country to buy our clothes, saving their fares on the transaction. Utility cloth represents good value for the money. It is unreasonable to expect the same quality of cloth at the same price in a period of rising prices. My hon. Friend recognises the value of the utility scheme. It has been a wondeful thing for the ordinary people of this country, and the utility range offers very good value for many excellent ranges of quality.
I will end on this note. The hon. Member for Edinburgh, South (Sir W. Darling), spoke about the Government controlling our lives, and then there was talk about debasement. Before the war cheap clothing was possible not through debasing quality, but through debasing lives. The wages that were paid to the people who produced the cloth were very 2288 small, and I hope that we shall never see their like again. The hon. Member for Edinburgh, South, said that the Labour Government had, since 1945, controlled the lives of the people. He meant it, of course, as a joke, and he said it with his tongue in his cheek. I want to tell him that the Labour Government will never consent to the debasement of the lives of the folk who make this cloth, and that they will work unceasingly to see that the quality of the stuff that is made is fit for the people who have to wear it.
§ Mr. Nabarro
Will the Parliamentary Secretary respond to the accusations made by half a dozen of his hon. Friends. to the effect that the manufacturers are making excessive profits and that the Board of Trade are thoroughly slack in not assessing those profits?
§ Question put, and agreed to.
§ Adjourned accordingly at Twenty-nine Minutes past Ten o'Clock.